Skip to main content

Orders Of The Day

Volume 894: debated on Thursday 26 June 1975

The text on this page has been created from Hansard archive content, it may contain typographical errors.

Welsh Development Agency (No 2) Bill Lords

Order for Second Reading read.

4.7 p.m.

I beg to move, That the Bill be now read a Second time.

This is an historic day for Wales. For the first time ever we are to discuss a wholly Welsh Bill on major economic and environmental questions. This follows from the Government's aim of ensuring there are in Wales effective instruments to tackle our real problems. In this Session we hope to secure the seal of parliamentary approval for this agency and also in the same period for the Land Authority for Wales. They are two major and badly needed organisations designed and tailored to meet the needs of Wales. In a matter of days, moreover, there will be transferred to the Welsh Office major industrial powers. These proposals add up to an unprecedented shift of power and effective machinery for decision-making to Wales.

It is against this background of transfer of power and the creation of new institutions that I ask the House to consider the Bill. We are breaking new ground in setting up an organisation in Wales devoted wholly to the development and reinvigoration of the economy and the environment. We are doing more. We are giving it the powers and resources necessary for success.

This historic day has been delayed by the actions of the hon. Gentlemen opposite who man the main Opposition Bench. It is recognised that the leadership of the Conservative Party in Wales today is as much out of touch with the needs and aspirations of Wales as were the dozens of English Conservative Members who trooped in to stand up in their support when the motion to send the No. 1 Bill to the Welsh Grand Committee was lost.

And the Scottish Tories, as my right hon. Friend reminds me.

The Conservative opposition are, of course, standing on their heads. In the last General Election their alternative to devolution was the development of existing institutions. Select Committees, the Welsh Grand Committee—all had a great future. But the moment we sought to use the Welsh Grand Committee they lost their nerve. They knew it would reveal how unrepresentative they are of the people of Wales and how unresponsive their philosophy is to its needs.

The Bill, despite the Conservative Party, has shown in the welcome it has received how Wales can be united. When I took office I said that one of my aims was to seek to unite the nation of Wales. This does not mean that we, who are traditionally contentious, should agree on everything—far from it—but there is more to unite us than to fragment us. The agency proposals are a practical demonstration of the way we can unite, and the overwhelming majority of Welshmen can be proud of this.

The Bill comes to us with the title "No. 2 Bill" after much discussion in another place. As a result, it differs in several respects from the Bill we originally put forward. There have been several improvements as a result of amendments which the Government were ready to accept—for example, on the size of the board of the agency and powers of entry. But I have to say—with real regret—that in the Bill's passage through the various stages in another place some substantial damage was done. I want to make it clear straight away that we intend to repair this damage fully during the Committee stage.

On two occasions the Opposition peers attempted to savage the Bill. They tried to get their teeth into two major questions: first, the proposal that the agency itself should carry on industrial undertakings and should be empowered to establish and carry on new undertakings; secondly, that the agency should have a responsibility to promote industrial democracy in undertakings which it controls.

Opposition peers sought to hack away at these proposals, mainly, I believe, because they have a parallel in the Industry Bill and were seen in the context of the Government's aim to establish a National Enterprise Board. Amendments were carried which, if allowed to remain, would have the effect of preventing the agency from establishing undertakings or promoting industrial democracy. I shall have more to say of this later, but let me say this now. The amendments introduced showed how far away Opposition peers and those who share their views are from the needs and thoughts of those who day by day by their work contribute to the Welsh economy.

The discussion in another place certainly did not reflect the wishes of the great majority of working Welshmen—whether in the steel complexes of South Wales and North Wales, the coal industries of the valleys, or the smaller but none the less important and growing manufacturing industries in rural Wales.

Despite the delays, I am determined to get the agency into operation by the end of the year. I am determined—and I am sure this view will be shared by all who have the best interests of Wales at heart—to see speedy progress on the remaining stages of the Bill.

It may be helpful briefly to remind the House of the background to the Bill. Earlier this year I published a consultative document setting out the Government's ideas for a development agency. We had long, purposeful and helpful talks with all interested organisations. As a result I was able in the light of the ideas expressed in these discussions, to go ahead and prepare the No. 1 Bill. In doing this, I knew that there was almost universal support for the establishment of a Welsh Development Agency. I know that the objectives I proposed for the agency were approved of within Wales. All consulted saw the need to accelerate the economic and industrial development of Wales and to seek to develop the environment in a way consistent with that objective.

Our environment is not to be further squandered and unnecessarily despoiled. So often history has taught us that the price of industrial advance was the rape of our fair country. Industrial advance there must be, but advance in harmony with the environment and this together with the urgent repair of the scars of the past. This is the bill that our generation has to pick up.

Against this background, there was approval of the further objective of bring- ing together in one organisation a group of functions concerned with industrial and environmental development.

There was, I regret to say, a little less unanimity on the proposals to give the agency new regional development functions analogous to those which the National Enterprise Board will have in England. I hope, however, that in time and after experience those who are still genuinely concerned about this aspect of the agency Bill will come to realise that it is an essential part of the scheme.

We are discussing these proposals at a time when the economic situation is very serious indeed. The economy of Wales as part of the economy of the United Kingdom is under strain, and much needs to be done by all concerned to reduce this strain. In the short term the proposals for an agency cannot be of direct help, but I have no doubt at all that once the agency is in operation it will bring powerful additional support to our battle for the health and the growth of the Welsh economy The fact that the Government are prepared to go ahead with this, and the comparable Scottish agency proposal introduced by my right hon. Friend the Secretary of State for Scotland yesterday, at the present time show the faith we have in the longer-term prospects of the economies of Wales and of Scotland.

It may be helpful in introducing the proposals if I mention by way of emphasis some of the more important points.

Clause 1 of the Bill gives the agency a clear responsibility to further economic development in Wales, to promote its industrial efficiency and international competitiveness, to provide, maintain and safeguard employment in Wales, and to further the improvement of the environment. These are broad, wide-ranging responsibilities.

There has been some fear that the agency is being given overriding—indeed, even dictatorial—powers. This fear is unjustified. It is in no way my intention that the agency will be in a position to carry out its responsibilities in any dictatorial way. On the one hand, the Bill provides me with powers of general and specific direction—controlling powers. On the other hand, the agency will carry out its responsibilities in ful partnership with existing organisations and local authorities. There is nothing in the Bill which would allow the agency to take over from or supplant any existing organisation—with, of course, the main exception of the Welsh Industrial Estates Corporation.

I see the agency—and I underline the word "agency"—as a strong executive arm, with the power to act for the benefit of Wales and with sufficient finance available to it. It is an additional piece of executive machinery, and I will ensure, and indeed I am certain the board of the agency will also ensure, that the agency carries out its activities in the fullest co-operation and partnership with others in Wales who have a responsibility for developing industry and for the environment.

As I indicated earlier, Clause 1 does not wholly reflect the Government's intentions. It is lacking in two specific and important powers. First, the Government believe that the agency must have powers to establish and carry on new industrial undertakings. It needs to have an interventionist rôle, and I make no apology for using the word "interventionist". The people of Wales have been crying out for more interventionist policies for decades. The existing division between industry and Government has not worked satisfactorily and there is the strongest case for bringing industry and agencies of the Government more closely together to their mutual advantage and particularly to the advantage of those whose employment prospects are at stake. It is the jobs of Welsh people that we are concerned with. It is providing the means so that the right to work can be exercised in Wales. I give a pledge to seek to restore this particular provision.

If the people of Wales are crying out for these interventionist policies and bodies which the right hon. and learned Gentleman was mentioning, why was there such opposition to the proposed Welsh rural development board?

The hon. Gentleman will be aware that there were some facets of that board which were not popular. I regret deeply the opportunity lost because of a combination of people of Mid-Wales who should have known better. Mid-Wales has suffered because of that. I speak as a Mid-Walian. I deeply regret that it will be my responsibility now, many years later, through the agency and other means upon which the Government decide, to make up for the years lost and the real money that has been lost in Mid-Wales.

The hon. and learned Gentleman has a grave responsibility for the millions of pounds lost to Mid-Wales and the lack of development throughout Mid-Wales.

I was glad to be able to announce the other day a major programme of factory building to arrest the loss of population in Mid-Wales.

I am grateful to the right hon. and learned Gentleman for suddenly remembering his parliamentary courtesy, having named me. Does he not know that the people of Mid-Wales had no objection as such to a board, but they had grave objection to the violent powers of interference with the rights of the individual? People found this highly objectionable. Many of these objectionable features will not now, we hope, be found in this agency. There is a world of difference between the two things.

As the hon. and learned Gentleman is well aware—I made it quite clear, although I shall repeat it—opportunity and years have been lost in Mid-Wales. I understand fully the nature of the objection. But the truth of the matter is that years have been lost in Mid-Wales and millions of pounds have been lost. I understand the objection. I am not entirely obtuse. I want to make it quite clear that there is a grave responsibility, and the hon. and learned Gentleman shares this, for the years that have been lost. I shall seek to ensure that we get over these objections and satisfy the people of Mid-Wales that their objections are unfounded. But the problem that faces us is to try to repair and make up for the lost years, lost because of opposition from hon. Members on the Opposition side of the House, and from the Liberal bench primarily.

We shall also propose the restoration to the Bill of the agency's responsibility to promote industrial democracy in undertakings which it controls. I have no doubt that, following the precedent in another place, hon. Members will seek to argue in favour of the amendment—new Clause 1(3)(d)—with its weasel form of words about industrial relations. But they miss the point. The Government are concerned to improve decision-taking at all levels of industry—to involve the whole work force. There is an obvious need for changes in the class structure of industry and in the balance of power and responsibility within industry. That is what the Government seek to ensure in undertakings which the agency controls.

I hope that the hon. Gentleman will let me proceed. He will be speaking shortly, and others will wish to speak in the debate.

This is an important point, because the right hon. and learned Gentleman is dealing with the question of industrial democracy. Surely what happened in the other place was that it sought a definition of what that phrase means. If the Minister is attacking what has been put in its place, will he now tell the House, so that we clearly understand the Government's objective, what the phrase "industrial democracy" does mean?

On the Government side of the House that phrase is easily understood. I can quite appreciate how some parts of the Opposition side of the House have no idea what industrial democracy means. I am not surprised that this has been objected to in this way, but I shall return to this matter in the days ahead in Committee. I am sure that we can spend a little time in educating the hon. Gentleman further, or perhaps beginning to educate him, about the problems of industrial democracy.

This first clause has also given rise to heated discussion about parallels with the National Enterprise Board. There has been much misconceived and misdirected criticism, much of it based on political dogma. But, for those who are able to clear their minds of dogma, let it be explicit: the Welsh Development Agency will in no way be an arm of the National Enterprise Board. Where the powers to be given to the agency are similar to those of the National Enterprise Board, this is because these are sensible and appropriate powers. The agency will be a body separate from the National Enterprise Board and will be in a position to harness its industrial powers in a distinctive way to meet the special needs and circumstances of Wales.

The Government have sought to emphasise this in every possible way. There have been many statements as the Industry Bill has gone through its various stages. There has been much correspondence with the Ministers concerned and recently a speech by Sir Don Ryder to the Development Corporation for Wales, in Cardiff. But certain hon. Members will persist in their opposition on this score. However, I hope that, as this debate goes forward, and as the Committee stage develops, their minds will eventually be set at rest.

I have concentrated on the industrial and the employment aspects of Clause 1, but there is more still to that clause. The clause emphasises the agency's rôle on the environment. The agency will accept, carry on and develop certain existing activities and responsibilities—for example, on derelict land clearance—and it will take on new responsibilities, particularly in urban areas; and it will do all this not in competition but in partnership with local authorities and others equally concerned with the environment.

The agency will also have power to promote Wales as a location for industrial development. This is a rôle which the agency will certainly want to develop slowly and carefully so that it takes completely into account the existing work carried out by organisations such as the Development Corporation for Wales and local authorities. Much helpful work is already being done but more needs to be done, and to be done as a matter of co-operation between all concerned.

Does that include overseas representation by the agency?

Yes, certainly. I think that the Bill makes it clear how the agency may act and the consents which are necessary when it acts outside Wales.

I turn now to Clause 2 which sets out the constitution and status of the agency. As Clause 1 makes clear, the agency has a big task. It will demand people of stature, strengh and wide experience to carry it out. I intend that the board shall be composed of people of outstanding skills and experience rather than simply representatives of particular groups. The board will, however, be able to call on additional advice and expertise. Clause 5 provides for the setting up of advisory sub-committees. For example, the board might wish to set up an economic sub-committee or one concerned with the environment.

I have not yet come to any decision on the location of the agency's headquarter offices or any out-stations. I have received proposals, well-argued proposals, from several areas of Wales,—for example, from Bleanau Gwent—in favour of Ebbw Vale and from both North-East and North-West Wales. I shall be discussing these proposals further. I want to look at all the needs of the whole of Wales and to make sure that the agency's all-Wales remit is reflected in its locations. At the same time we must bear in mind that much of the agency's work will be to carry out the responsibilities of the Welsh Industrial Estates Corporation. To that extent it will make sense for the agency to continue to use existing sites and premises of the estates corporation.

I will mention Clause 3 only briefly and refer specifically to the agency's power to carry out inquiries, investigations or researches. For example, the agency might well take over a derelict land survey of Wales and sponsor research into specific economic problems. To that end, the agency will need to have a specific research function and the staff to carry it out. But once again I want to make it clear that the task of the agency is to work in partnership. It would make no sense at all if it were to supplant the rôle of local authorities, for example in structure plants; and the overall responsibility for determining economic strategy for Wales in the context of the United Kingdom as a whole will remain with me.

I have spoken at several points about partnership. This is what is emphasised in Clause 4, in particular the interrelationship with local authorities and with the development corporations of new towns. I believe that as a result of the consultations earlier this year there is a full understanding by local authorities of the way they and the agency will be able to work in partnership. The agency will not be in a position to take over local authority powers. I would underline that. For example, the agency will have no special planning powers. These will remain with local authorities. In the same way the agency will not overlap or interfere with the operations of the new town development corporations. Rather, the way is open for them to work together.

I hope it is clear that rural Wales falls as much within the agency's remit as does urban industrial Wales. The agency's remit covers the whole of Wales, and I regard it as having a responsibility to contribute to developing rural as well as urban Wales. This naturally raises questions about the special needs of mid Wales and the concept of a Mid-Wales Development Board. I have made it clear throughout this year that we are giving priority in this Session to establishing a Welsh Development Agency with an all-Wales remit. But I have made it equally clear that we are giving the most careful consideration to what else may need to be done in rural Wales in the light of the developing rôle to be given to the Welsh Agency and the responsibilities of existing bodies.

I turn now to Clauses 6, 7 and 8, which transfer the work and responsibilities of the Welsh Industrial Estates Corporation to the agency and give the agency the important powers of providing sites and premises for industry and providing services for the development of industry, including, may I say here, any developments connected with the successful exploitation of the Celtic Sea.

The Welsh Industrial Estates Corporation has been a good servant of Wales since it was established under the Local Employment Act 1960. It owns 375 factories at an insured value of over £100 million. It has gross rents totalling almost £2·5 million a year. It holds some 2,600 acres of land and its annual expenditure in 1975–76, including a special provision for the support of the construction industry, will amount to almost £11 million. This is a sizeable responsibility and I wish to pay tribute to all those, both now and in the past, who have made the Welsh Industrial Estates Corporation such a successful part of the Welsh industrial scene.

The agency will now take over and I hope develop and expand the work of the estates corporation, and it will carry on this work as part of the agency's responsibilities to the Secretary of State for Wales. Hitherto, the main directions to the estates corporation have come from Whitehall as part of the overall central control of the three estates corporations in England, in Scotland and in Wales. There will, of course, be continued cooperation and links with estates corporation work in England and in Scotland, but from the establishment of the agency the main control of the estates corporation work in Wales will come from within Wales for Wales. It has already been announced that as from 1st July the Welsh Industrial Estates Corporation will be responsible to me and to the Welsh Office. This will be a most helpful transitional stage, a period of consolidation, before the formal transfer to the agency. I look forward to a further long period of successful estates corporation work.

Clauses 10 and 11 both refer to regional selective assistance under the 1972 Industry Act. As from 1st July these powers within Wales will fall within my responsibility and will be operated through the Welsh Office.

I am grateful to the right hon. and learned Gentleman for giving way. Before he leaves the point about vesting of the industrial estates, under which the new direction will come to the agency, is there any implication—I am merely asking for information—that there will be a degree of competition between the Welsh Agency and the Scottish Agency and the comparable body for England for new industry? This would appear to be an important change if that is the case.

In any powers regarding industry and the giving of assistance to industry, it is obviously necessary that one should be able to keep the various organisations which have facilities at their disposal in tandem wherever there are particular enticements. Therefore, in any responsibilities that I shall carry, or where an agency acts on my behalf, it is necessary for the left hand to know what the right hand is doing. I hope that that satisfies the hon. Gentleman.

I take this opportunity to welcome to the Welsh Office those staff of the Department of Industry in Wales who will transfer with the work. Their contribution in the past has been great and has been welcomed and respected by industry. I know that it will continue and expand and I am making sure that there will be a smooth transition with the minimum of disruption to staff and, equally important, the minimum of disruption to industrialists and others who use the services.

Hon. Members opposite, I know, are inclined to argue that the powers of the 1972 Industry Act are enough. Why go beyond these powers, they ask, in their forlorn attempt to oppose proposals in the Industry Bill and the Welsh Development Agency Bill. I hope that hon. Members will forgive me if I remind them of the comments I made on the 1972 legislation during our debate on Welsh Affairs on 21st March 1974, in the early days of my office as Secretary of State for Wales. I then criticised the deplorable economic performance of the previous administration and said:
"Like Saul on the road to Damascus, the last Government saw a blinding light, and in the spring of 1972 they reintroduced investment grants—although in an attempt to cover up their past folly they now called them regional development grants. Saul was renamed Paul."—[Official Report, 21st March 1974; Vol. 870, c. 1355.]

May I say,

"By their fruits ye shall know them"—
and to the extent that I mentioned the 1972 Act, it was an improvement on their past performance. But the fact remains that the 1972 legislation is demonstrably not enough today. I must again emphasise that there is a need for more direct links between Government and industry of the kind which an agency can promote. This is one reason why the agency is so much welcomed by those whose day-to-day life depends on the health of Welsh industry.

Clause 10 provides for the agency in certain circumstances to act as a channel for regional selective assistance. How often this power will be used will be for determination by me in the light of individual cases. I think we may expect, however, that regional selective assistance will generally continue to be handled directly through the Secretary of State.

It may be argued that giving the Welsh Office control over regional selective assistance could weaken the agency's rôle. I do not accept this argument. The two rôles are as distinct as they are complementary. The agency will be expected to act on its own initiative to seek out opportunities and directly involve itself in industry. This type of enterpreneurial rôle is best performed by an agency. The agency will be able to give itself wholeheartedly to this rôle, since it will not have to bear the considerable burden of handling requests for assistance. I think that Parliament would feel it right that the major decisions on requests for assistance should remain directly under the control of a Secretary of State responsible to Parliament, especially since there are often in such cases most sensitive employment implications.

If, however, the powers in Clause 10 may be used only sparingly, it is certain that those in Clause 11 will be used regularly. As a result, I shall have available to me a statutory board replacing the present non-statutory board—to advise me on all Section 7 cases in Wales. This board will also have to develop a close contact with the agency, and there could well be a need for some overlapping of membership either with the agency's board or with one or other of its sub-committees.

Clauses 13 and 14 deal specifically with the environmental rôle of the agency. The agency will have a dual responsibility here—developing, redeveloping and improving the environment and grant-aiding local authorities in carrying out derelict land clearance work and carrying out such work itself. There is no doubt that this work needs to be done within Wales and that more resources, both of people and finance, must be devoted to it. It is no good developing industry unless at the same time the environment is preserved where it should be and developed where it needs to be. The agency will be in a position to help ensure this. The environment is a resource which must be as carefully husbanded as any other resource in Wales.

For the removal of any doubt, I should emphasise here that the agency will be expected to bring forward proposals for approval in full consultation and harmony with local authorities. It will take account of expert advice from bodies such as the Countryside Commission and the Nature Conservancy Council. The agency will have to obtain planning permission from the local planning authority on every occasion when this is required. There is no question of the agency being put in a privileged position.

Local authorities in Wales have won an outstanding reputation for their work on derelict land clearance, and, as I have said, their powers remain untouched. We are seeing a revolutionary change in that emotive title, "How Green was My Valley", from the past tense to the present. In many places the "was" is becoming "is"

The Bill emphasises that local authorities in Wales will continue to have a major role in land clearance schemes, whereas I note that in the Scottish Bill the emphasis is on the Scottish Development Agency itself undertaking derelict land clearance schemes and relieving local authorities of that responsibility. We shall not follow the Scottish pattern in Wales. Rather we shall build on what has so far been achieved. About 19 per cent. of the derelict land in Wales has been reclaimed in the past seven years—about 6,500 acres. If, as we all hope, the Welsh Development Agency will choose to give a priority to derelict land clearance and provide a substantial, accelerated rate of expenditure, we have some expectation that something approaching half of the derelict land in Wales might be cleared by the beginning of the next decade. I feel sure that it is the wish of all parts of the House that the agency shall give priority to this work.

As a further indication of the Government's support, the level of grant to local authorities will be raised to 100 per cent. of the net cost, and we hope that the full resources of the kind now provided by the Derelict Land Unit in the Welsh Office will continue to be available within the agency. Lest there should be any concern about delays as a result of the changeover from the Welsh Office to agency responsibility, I am making sure that there will be no halt in the on-going work on land clearance.

Clauses 15 to 18 set out the financial rôles for the agency. There cannot be criticism of the need for the agency to conform to specific financial obligations where this makes sense. For example, it is right that on that part of the agency's work which involves an industrial investment rôle it should have a specified financial objective. Equally, it is right that other activities of the agency—for example, on land clearance and environmental uplift—cannot be regulated by specific financial objectives. These would simply be inappropriate.

The agency will have an initial financial allocation of £100 million, which can be raised to £150 million. I recognise that there are arguments that this financial allocation is not enough. But what is now to be provided represents a heavy commitment by the Government at a time of strong competing demands on the financial resources available to them. It has to be emphasised that this £100 million to £150 million is additional to expenditure in Wales on selective assistance, regional development grants and the regional employment premium. The amount allocated—and there is no specific time period attached—will allow a start to new activities such as the agency's industrial development rôle and an increase in existing levels of spending on activities which the agency will take over—for example, the derelict land clearance work. At this stage, before the agency itself has had an opportunity to discuss its priorities, I am not in a position to indicate how rapidly the agency will recommend drawing on its financial resources. But I am sure it will recommend wisely and well.

Are there any guidelines to the time span over which the £100 million or £150 million can be drawn on? The question has arisen, and is sure to arise again, whether it would be reasonable to come back for more if the money were spent within, say, the first 18 months. Should the agency think of it as money to spend over three or four years? I ask in order to obtain guidance for those running the agency.

There is no time span and no time limit. It will be for the agency to make proposals to me and, within the limits laid down by Parliament, to ensure that it has the funds available to it. I am sure that the agency will make wise proposals. We are anxious to ensure that the needs of Wales are met. This is a significant tranche of money. I emphasise that it is in addition to at least £60 million a year at present spent in Wales on such matters as selective assistance, regional development grants and the regional employment premium. That is the scale of the Government's assistance to Wales.

Clause 19 sets out the agency's powers to acquire, dispose of and take over land. The agency, in carrying out its land development rôle, must have powers to acquire and dispose of land. But it is not being given powers which in any way conflict with local planning responsibilities.

The remaining clauses of the Bill are in a sense "bread and butter". These have been exhaustively discussed in another place and reflect amendments introduced there and accepted by the Government. These amendments—unlike those to which I have referred earlier—serve to improve the Bill and I, therefore, very much welcome this part at least of the hard work which went on in another place under the direction of that most distinguished Welshman, the Lord Chancellor, who led the Bill.

If we put all the clauses in the Bill together we have the basis of a complete and coherent agency. The agency, like the Bill itself, is an amalgam. It has the distinct merit of bringing together in one organisation a variety of powers all directly related to the industrial process—acquiring land, reclaiming land for industrial purposes, establishing industrial estates, constructing advance factories on these estates, attracting firms to Wales, helping firms with finance and advice and so on throughout the whole stage of the industrial development process—and doing this while throughout having an eye to the preservation and the development of the environment.

The agency will be an institution for Wales within Wales. As I have said, it will be established in Wales in the same period when new powers in the industry field are being transferred to the Welsh Office. Taken as a whole, these changes indicate a major shift of responsibility to the Principality. This gives us all in Wales a chance to show what we are made of as we involve ourselves directly day by day in the economic life of Wales.

I know that the people of Wales wish the proposals in this Bill to succeed and that they will wish the agency well. They know, as I know, that the proposals in this Bill represent a coherent and constructive way of helping to organise and sponsor industrial and environmental development in Wales where it is most I recommend the Bill to the House.

4.53 p.m.

The Secretary of State said that it was a historic day. It is also, I think, the first day that Wales has had on the Floor of this House for more than 15 months—in fact, since March 1974.

It is not the traditional Welsh day debate in which Members can range widely and examine the performance of the Welsh Office in the previous year. It seems clear that the Government have little intention of giving us that debate this side of the Summer Recess. It seems that they find it appropriate that Wales should have to wait at least a year and a half before it can be given the time to which we believe it is entitled, and yet they grumble because we insisted that this debate, on a Bill that they claim to be of vital significance to Wales, should be held here and not upstairs.

Even more extraordinary, they tried to persuade us to hold this debate last week, before the Bill had completed its progress in another place, and they tried to fob us off with half a day. Even in the last couple of days, Labour Members have been queuing at the Opposition Whips' Office to try to arrange pairs after seven o'clock tonight, on the understanding that the debate is to be allowed to fold up at seven.

It is disgraceful that Wales should be treated with this kind of disrespect. Of course there is a place for Committee work. We should like to see a Welsh Select Committee set up without delay, but it will be a bad day for Parliament if this Chamber abandons the task of examining the principles of important Bills, and a bad day for the country it we are so casual about the planned expenditure of £100 million that we do not give an opportunity to all Members of this House to hear the Government of the day justify it and defend it against criticism.

It is because we have become so casual about this job of voting Supply or refusing to vote Supply that we are in our present mess. It is in the context of that mess, and against the background of the economic disaster that now confronts us, that we have to consider this measure.

The Secretary of State at times has seemed to wax euphoric about the Bill, but even he was forced to acknowledge, in the Welsh Grand Committee in May, that the heart of the matter is solving the problems of the United Kingdom as a whole. He conceded that the agency to be set up by the Bill does not offer salvation for the Welsh unemployed, and today he said that in the short term the proposals for an agency cannot be of direct help. It is what he called an additional piece of executive machinery to be judged against the situation in which it is asked to operate—at best a useful tool; at worst a positive impediment to economic activity.

It is important that we should be absolutely clear about this, and that we should face up to the fact that whatever we may think about the agency is entirely secondary to the Government's management of the economy as a whole. That, as the Secretary of State says, is the heart of the matter—and a proper mess they are making of it, too!

The prime responsibilities of any Government in the field of economic management are: first, to create a climate in which productive industry can maintain national output at something approaching its full potential; second, to ensure the maintenance of a high level of employment; and, third, to preserve the value of the currency, internal and external.

The Government have created a situation in which national output is back to the level of the three-day week, in which unemployment is at its highest June level since before the Second World War, and in which 25p has been sliced off the pound in the people's pocket and 27 per cent. has been knocked off the pound sterling in world markets since December 1971, so that today it stands at its lowest ever level.

On a three-monthly basis, the rate of Inflation in Britain has now crossed the 50 per cent. threshold into hyperinflation only eight months since the Chancellor of the Exchequer's notorious 8·5 per cent. statement.

In Wales this June there are nearly 7,000 more people out of work than in any other June in the last 35 years. The seasonally adjusted figure of 53,000, or 5·2 per cent. of the working population, takes no account of short-time work, factories working a three-day or four-day week, or companies holding on to workers to maintain a nominal state of employment. The figure has deteriorated by ½ a per cent.—in other words, by over 5,500 people—since we last debated the matter in the Welsh Grand Committee in early May.

During the same period the Government have done nothing to check the inflation rate, nothing to cut their own expenditure, and nothing to restore confidence in industry. By doing nothing except increase their own expenditure they are ensuring that the sickness will become more critical and the eventual cure more painful.

We are considering the Bill at a time when there are more than 20 Government factories in Wales standing vacant, when the number of firms known to be on short-time work is approaching 100, and when the number of inquiries and first visits from outside Wales is sharply declining. The Welsh CBI report "seriously depleted order books" and that companies are holding back or cancelling investment plans wherever that is possible.

The Welsh Secretary of the CBI writes in a letter to me this week:
"The underlying trend of unemployment is, of course, upwards and we expect the position to deteriorate as increasing numbers of employers realise that there is not going to be an upturn in the economy in the near future and are therefore compelled to release work people."

Did not the Welsh Secretary of the CBI also say in the same letter that he and his members accepted this agency in principle?

He did nothing of the kind. I shall be coming to the views of the Welsh CBI later in my speech.

The architects of this disaster, the men personally responsible for this mounting national misery, are the architects of this Bill. The agency is charged with the job—in the original version it was given the duty—of furthering the economic development of Wales. But that central responsibility cannot be that of a subordinate agency. It is the job of the Government, and it is a job that this Government are failing to do calamitously.

The Secretary of State said that the agency was a vital part of the machinery which he needed to tackle the problem. But it is absurd to imagine that the task of assisting individual companies, of stimulating job creation in individual locations or even of achieving such generally desirable social objectives as the clearance of derelict land are possible, however good the machinery, if the Government mishandle the general management of the economy.

We also have to consider the Bill in the context of the Government's legislative programme as a whole. It cannot be judged in isolation. Clearly, it is part of a package of measures designed to achieve a Socialist objective. I do not blame them for that, because it is their belief. It goes hand in hand with the Industry Bill, and whole sections of it have been lifted almost straight from that Bill. However the relationship between the National Enterprise Board and the agency is defined—and we shall wish to return to it in Committee—it is clear that the NEB will retain some of its most formidable powers for operation throughout the United Kingdom—for example, the vesting order power of Clause 10 and the power to extend public ownership into profitable areas of manufacturing industry.

If it were not blasphemous to say so, I should suggest that we were discussing something rather like the Trinity—a mystery in which separate powers combine to make up a whole. This interlocking relationship is well illustrated by the fact that the agency will have the duty to implement the provisions of the 1972 Industry Act as directed by the Secretary of State, but provisions from which all safeguards and all the protective clauses are being removed by the present Industry Bill.

Those safeguards were that the Secretary of State had to be satisfied that assistance could not be given in any other way than by the acquisition of shares. He could not acquire more than 50 per cent. of the equity capital, and he was required to dispose of any stock or shares as soon as practicable.

It is the common phraseology, the shared objectives and the interlocking relationships of the Bills which are so alarming to many people, especially to those involved in private industry. They see the agency not as something designed to assist Welsh industry but as part of a package of State interference and State aggrandisement which they believe will be deeply damaging to private industry and, therefore, to the jobs and well-being of the Welsh people.

Some people in Wales have rejoiced, because they claim that the Secretary of State and the Welsh Office have extracted their powers from the even more dangerous hands of the Secretary of State for Industry, whoever he may be from time to time. The Western Mail suggested in a leader that if the. Conservative Opposition curbed the Secretary of State for Wales we would be
"…handing hard won autonomy straight back to Mr. Benn or his successors."
In some way, it sees the Welsh Office as a more cosy institution than the Department of Industry. It is a false analysis, because these two Bills and the Scottish Bill which was debated yesterday are separate instruments to implement the will of one Government. The doctrine of collective responsibility may have been sullied a little in recent weeks, but the fact remains that a Secretary of State defined in a Bill still means any Secretary of State. This agency is to be not an independent body but the tool and instrument of the Government carrying out their collective will.

We have to consider the Bill against the Government's handling of the economy and as part of their industrial policy. We have to judge it in expenditure terms and by its impact on industrial confidence.

This Bill is a very different one from that originally presented to us. I suggest that it has been much improved by amendments in another place. It has had removed from it some of the worst features of the original Bill, especially the power for the agency to involve itself in business competition with the private sector.

From the hon. Gentleman's comments on the powers which have been removed for the agency to compete with the private business sector, are we to assume that on behalf of his party he no longer welcomes competition in industry? His party has always spoken in favour of competition. Why turn down competition from the public sector in this way?

The competition provided in this way by the public sector can be actually destructive because of the unlimited resources available to it which can destroy private firms competing in the same area. If jobs are created in the public sector, it is done at the expense of jobs elsewhere.

I continue dealing with the changes made in the other place, and I shall return to the topic raised by the hon. Member for Caernarvon (Mr. Wigley).

The wording of Clause 1 has been altered so that the agency does not have laid upon it duties which could have been contradictory. It has been brought into line with the Scottish Bill. The membership of the agency has been enlarged. The selection of a chief executive, except on the first occasion, will be made by the agency and not by the Secretary of State. An attempt has been made to define the phrase "industrial democracy". The Secretary of State refused to define it today. Whatever he may understand by the phrase, here we are producing an Act of Parliament, and this is a phrase which has to be understood clearly and interpreted in the courts. The Government failed totally to provide any form of definition in the other place which would stand close examination. Finally, we have seen safeguards introduced for farmers on matters which worried those engaged in agriculture.

Although we are still highly critical of the detailed powers of direction given by the Secretary of State and of the lack of parliamentary control, I should have been inclined to recommend to my right hon. Friends to give the amended Bill a Second Reading had it not been for the speech today by the Secretary of State. [HON. MEMBERS: "Oh!"] In that speech, the right hon. and learned Gentleman made it quite clear that in reality the Bill that we should be considering in Committee was not this Bill but the one originally presented to the House. He made it clear that he intended to put back the power to form bodies corporate, to carry on industrial undertakings and to establish and carry on new industrial undertakings.

The Secretary of State said that he sought to unite the people of Wales. I wonder whether he realised that he had within his grasp, and still has, the possibility of an agreed measure backed by all the parties and acceptable to both sides of industry. Of course, we should all have to give up something and to accept some things that we did not like. But I ask the Government whether it would not be worth surrendering one of their objectives in order to set the agency to work in an atmosphere of mutual confidence and support.

Is the hon. Gentleman being quite frank with the House when he says, as he did just now, that had it not been for my speech he would have been prepared to recommend his colleagues not to vote against the Bill? He knows about the Whip which was issued by his party instructing hon. Members to attend here at 10 o'clock tonight in order to vote against the Bill.

We had already heard speeches by Government spokesman in another place making it quite clear what the Secretary of State would do. We had been forewarned. But I am saying to the right hon. and learned Gentleman now that if he cares to say that he will not seek to put back those clauses which were taken out in another place, I shall recommend my right hon. and hon. Friends to accept the Bill which has been sent from the other place.

Let me try to concentrate the hon. Gentleman's mind. What was there new in my speech today about what I should ask the House to restore to the Bill other than what was said in another place by the Lord Chancellor to the same effect?

I agree that there is seldom anything new in any speech which the right hon. and learned Gentleman makes. We had every right to expect the intransigent statement which he offered us. We hoped that he would have had more imagination, but we feared that he would not.

The Opposition support the creation of an agency which will co-ordinate industrial effort in Wales. We welcome the environmental functions. The CBI welcomed the proposal to form a body to accelerate the economic and industrial development of Wales and to improve the environment. So do the Opposition. We think that a development agency, though no substitute for proper management of the economy by the Government, could be a useful mechanism. But the CBI in Wales has also made it clear that it deplores the powers given to the agency to take equity holdings in companies to which it has given assistance and that it is opposed to the sections which the Government are now pledged to reintroduce which would enable the agency to take over companies, to set up organisations, to do business and to complete with the private sector.

I cannot follow the objections of the hon. Gentleman in principle to the State taking a holding in, for example, BP. Is there any objection to that in practice? Surely we should be concerned with the way in which any industry is run. We should be concerned not so much with who owns the equity as with how it is run.

I said that the Government should not have power to set up organisations and take a controlling interest in organisations in competition. There is nothing in the amended Bill to stop them going into partnership. There is specific provision for them to be able to do so. I hope that in some cases they may even take that course.

Does my hon. Friend agree that the comparison with BP is false? This applies to international companies in which the Government interfere at their peril, as we saw recently with the purchase of Burmah shares.

My hon. Friend makes a sound point. No doubt there will be others.

We are told that the acquisition can be made only by agreement. But there is a difference between a negotiation transacted freely between equals and one in which the agency is bidding with unlimited funds behind it. The agency can indulge in contested take-over bids. It can use its financial strength to overcome the wishes of the directors. It will be able to pay whatever price it likes so that it is impossible for shareholders to refuse taxpayers' money.

Having taken over a company, or having set up its own company, regardless of commercial considerations, the agency will be able to compete with private companies in Wales with all the strength which its resources can give it. If we are to overcome our economic difficulties, the Government must restore the confidence of industry. They must create the right economic conditions in which firms can prosper and enterprise can be rewarded.

The Government's insistence on restoring these powers, and their clear determination to enlarge the public sector will have a disastrous effect on the confidence of industry and will damage the relationship of the agency with industry. Nor do I believe that the agency will be equipped to take on this active entrepreneurial rôle spelt out for it by the Government. It will not be equipped to decide where individual enterprises should be established with any prospect of success. Nor will it have the management required to supervise those operations.

Given stable market conditions and some confidence about the economy of our country, business men will usually exploit commercial openings if they exist. It is hard to see why the Secretary of State or the agency should judge circumstances better than a collective body of individual business men reacting to industrial opportunities. There can he no point in establishing factories where no markets exist for products or where the costs of operations will be uneconomic. Either the operations will fail in the long terms or be kept alive by means of ever-increasing subsidies, the cost of which has the effect of destroying other businesses elsewhere and putting other people out of work.

The Secretary of State said that we needed an intervention body. However, speaking on Second Reading of the Industry Bill about the vital need for a profitable private sector, the Paymaster-General said:
"Any idea that we can substitute for it, that Whitehall can manage British industry, that it can take its investment decisions, its marketing decisions, its research and development decisions, would be an illusion."—[Official Report, 18th February 1975; Vol. 886, c. 1135.]
Of course, the Paymaster-General was right.

In another place Lord Lovell-Davis, speaking for the Government, said:
"Wales needs an agency which can help to make Welsh-based firms more viable, more competitive and more free-standing."—[Official Report House of Lords, 12 June 1975, Vol 361, c. 563.]
We agree. But we do not believe that that can best be done by taking over private companies or setting up new companies owned by a State-directed organisation.

That is the principal reason why I shall urge my hon. Friends not to give the Bill a Second Reading. We must take not the Bill as it is presented to us but the words of the Government when presenting it.

There are other aspects to which we object. My reference to a State-directed organisation brings me to the first. We object to the dictatorial powers given to the Secretary of State and to his power of specific direction. We object to the lack of parliamentary control.

Under Clause 7(1) the Secretary of State can give the agency general or specific directions which the agency is bound to obey. It is the agency's duty to prepare and submit schemes to the Secretary of State if he asks for them. But the Secretary of State can refuse to approve them. The Secretary of State has the power to appoint the chairman and the members of the board. He can appoint the first chief executive, and would have appointed subsequent chief executives but for an amendment in the other place. He determines the financial duties of the agency. He directs the agency to exercise powers under the Industry Act 1972. None of those powers is at present subject to effective parliamentary control. Other than that, they may be referred to in an annual report published long after the event.

As originally drafted, the Bill restricted the agency's power to appoint committees.

I do not want the hon. Gentleman to labour under a complete misunderstanding of the Bill. On the one hand he presses the need for more parliamentary control. On the other he objects to my powers of specific direction. I shall have the power of specific direction to ensure that there is parliamentary control. That is why the proposed body is different from the water body which was set up by the Conservative Government. The result is that hon. Members will be able to ask Questions of the Secretary of State about the activities of the body. The hon. Gentleman cannot have it both ways. He cannot object to specific actions and claim that there is no parliamentary control.

I hope that the Secretary of State will act on two points. I hope that he accepts the amendments we propose for the early notification of these powers when exercised. I hope that he will accept our proposal that we should have a Welsh Select Committee so that we can examine his performance and the performance of the agency.

As originally drafted, the Bill even restricted the power of the agency to appoint committees. While dealing with that point, Baroness White, a former Minister at the Welsh Office, and a supporter of the Government, was moved to tell the Government that she would not feel inclined to serve on such a body if she were invited to do so. Like Baroness White, I thought it intolerable that the members of the agency should be so much under the thumb of the Secretary of State. A concession has now been made, but I agree with the Baroness that there are too many manifestations of "nanny knows best" in the Bill. Those were the views expressed in another place. The Government can dismiss them if they feel like doing so.

Sadly, it is the intention of the Governernment that the agency is to be nothing more than the creature of the Secretary of State. I think that that will be a dispiriting experience.

In Committee we shall have a great deal more to say about the powers given to the Secretary of State and the lack of public accountability. We shall seek to move amendments that will at least ensure that Parliament is informed at an early stage when the Secretary of State exercises his power of direction or overrides the agency. But the most serious aspect is the lack of accountability for public money. The Secretary of State for Energy—the architect of the Industry Bill—has frequently argued the case for public knowledge about finance for the taxpayer when it is provided for individual companies.

Accountability can be achieved only when clear-cut criteria are laid down as to the use of public funds. That concept of accountability is entirely destroyed when the Secretary of State can give specific directions to the agency and, in effect, make up the rules as he goes along. Accountability can be restored only if on each occasion the Secretary of State does that the fact is reported very soon to Parliament.

The very first act of public accountability should occur during the Second Reading of a Bill, when the Minister should explain and justify to the House the Commons the expenditure of public money, but that has been a duty on this occasion most casually performed.

We are told that £100 million—or £150 million by order—is to be made available to the agency, but we are entitled to know a great deal more than that. We know practically nothing. How quickly is the money to be spent? How far will the Government control that expenditure? In discussions on the consultative domument there was talk of the money being spread over five years, but, in the present financial crisis, is the agency to be told that there is an annual limit beyond which it cannot go or, taking its cue from this profligate administration, can it blue it all in 18 months, as suggested from the benches behind me, and come back for more? The Secretary of State said that there was no time span and no time limit. Will he say exactly the same after the economic measures have been announced by his right hon. Friend the Chancellor of the Exchequer within the next three weeks?

During the debate in the Welsh Grand Committee on 31st May, the Secretary of State confirmed that in the current financial year the expenditure of the agency over and above the money already being spent on selective assistance, regional development grants and the regional development premium was planned to be £8 million or £9 million. He went on to say that the agency would be operational for only part of the year—for three or four months perhaps—and made clear that we should do a multiplication sum to arrive at an annual rate of expenditure——in other words, between £24 million and £36 million. Are we to assume that the Government will allow the agency to spend that sort of sum in a full year? Is that the intention? We are entitled to be told how much the Government expect to be spent on the various functions. What, for example, is the agency's range of expenditure likely to be on development land clearance, and how does it compare with current expenditure?

We are sometimes given the impression that extra funds of £100 million are being injected. That is not really the position. The Secretary of State referred today to expenditure of £11 million by the Industrial Estates Corporation, and £3 million is being spent by the local authorities on derelict land clearance. That represents £15 million a year which is being expended at present and which will be absorbed by the powers of the Bill.

In another place, the Lord Chancellor said that the agency would be able, with the additional resources made available to it, to do more in existing spheres—for example, derelict land clearance—and to make an impact in new activities. He went on to say that the Bill did not specify any period for which the funds should last and that the Government thought that was right. He said that it was hard to predict how rapidly the agency would need to draw on financial resources. The Secretary of State said today that he was not in a position to indicate how rapidly the agency would draw on the funds. Is that all that can be said? Is it right in the present economic crisis for the Treasury to leave entirely uncontrolled the rate at which £100 million of public money is spent? I just do not believe it.

The Government have been equally imprecise about the £200 million allocated to the Scottish Development Agency, not to speak of the £700 million granted to the National Enterprise Board. We are talking about a collective expenditure of £1,000 million of public funds—taxpayers' money—without reference to Parliament at a time when the Government have a borrowing requirement of at least £9,000 million and problably more.

It will be of no benefit to the Principality if we provide financial aid to individual companies only to have them bankrupted by inflation unleashed largely as a result of excessive public expenditure. If that policy is pursued, for every job created in an agency project 100 jobs will be lost in small companies throughout Wales.

It is imperative that the House of Commons should not permit the expenditure of a pound that it has the power to control without being fully satisfied that that expenditure is essential and unavoidable. Before the House authorises spending on this scale, it should at least insist on knowing much more about the details of the expenditure than it has been told so far. It should do something else as well. It should ask for a statement of the Government's strategy. It should insist on an answer to the question whether expenditure of the kind provided for in the Bill is likely to produce the best results and the best value for money.

If there is to be stringency—that is what is belatedly promised by the Chancellor of the Exchequer—if every pound is to count, it must be spent in the right way. It may be more sensible to spend available resources on the infrastructure, on building roads and on providing sewerage and water facilities than on grants and loans to individual companies, let alone on the acquisition by the State of private companies or the establishment by the State of industrial enterprises.

The question we have to ask is what will be achieved by the expenditure of the extra money in terms of lasting employment opportunities and prosperity for Wales. Could it not perhaps be better spent? The taxpayer has a right to know that he is getting full value for his money.

For 10 years regional policy under both political parties has been concentrated on the payment of expensive subsidies to manufacturing industry. That policy has met with some success, and such aids have a vital part to play, particularly at a time when there is a heavy rundown of the old labour-intensive industries. In the Welsh Grand Committee debate on the economy I pointed to some of the results of the Conservative's Industry Act 1972 which had been given in recent Government answers. I referred to the 600 applications for projects in Wales and 23,000 jobs. None the less, we also have to acknowledge that there has been too little sign of widespread self-generating economic development in any part of Wales—and that is what we all need.

In April 1964 the unemployed in Wales as a percentage of the unemployed in the United Kingdom was 5·7 per cent.; in April 1974 it was 6·5 per cent.; in June 1975 it is just under 6 per cent. In June 1964 41·4 per cent. of the population was at work; in June 1973 41·5 per cent. of the population was at work—and that at the height of the boom. In 1960 there were 669,000 male workers in employment; in 1973 636,000 and in June 1974 621,000.

Unemployment is relatively high in Wales, partly because of the decline of the old industries, but partly because investment is less profitable in Wales than it is elsewhere. The most common reason for this lack of profitability is poor communications. The motorway map of Great Britain reads like a map of the development areas in reverse. After 16 years of motorway building, there are still only 27 miles of motorway in use in Wales. Time after time lack of communications has proved vital to investment decisions.

As a temporary expedient, subsidies are invaluable. I do not argue that they have not a part to play, but I fear that the creation of the agency may tip the balance so that we get the strategy wrong or, perhaps worse, that there is no strategy at all.

In general terms, it is a mistake for the Government to dictate these matters. They make mistakes. The job of the Government is to provide the conditions in which industry can flourish—infrastructure, labour training, education, housing to promote mobility, low taxation—and let industry get on with the job.

When presenting the Bill the Secretary of State had absolutely nothing to say to the House about his strategy. We are supposed to take on trust the policies of an administration whose every act so far has caused production to decline, the pound to lose its value and people to lose their jobs.

The Secretary of State puts the Bill forward as a kind of magic potion although he has done nothing to cure the fundamental sickness. He seeks to interfere where he should leave alone. He seeks to dictate where he should give freedom. He seeks to keep from this House the information that it should rightly have. Given the chance of an agreed measure, he rejects it. He persists with policies that destroy confidence. For all these reasons I ask the House to reject the Bill.

5.30 p.m.

I do not propose to comment in any detail on the rather sour and ill-tempered speech that we have just heard from the hon. Member for Pembroke (Mr. Edwards). [HON. MEMBERS: "Shameful—"]

I believe that the House as a whole and all those who view the Bill objectively are of the opinion that the great majority of people in Wales appreciate that this is one of the most important Bills affecting the Principality to come before the House in modern times. The objectives, the scope and the powers which the Bill confers on the proposed agency and on my right hon. and learned Friend the Secretary of State are of the utmost significance. For these reasons it is essential that the Bill should be subjected to most careful scrutiny, as, of course, it will be in Committee.

However, the Bill must contain powers if it is to do the job and not to be the sort of boneless and toothless creature which the hon. Member for Pembroke appears to want.

During the whole of my time in the House I have been more concerned about the problems of unemployment, depopulation, attracting new industry to Wales and finding new opportunities for our young people than with anything else. The pages of Hansard are proof of this. During the whole of this century, and indeed even longer, with the exception of the two wars, we have been afflicted with the twin evils of unemployment and depopulation. At one time they were taken for granted as being inevitable by the predecessors of the hon. Member for Pembroke. The scrapheap of unemployment and the slagheaps of the pits were, in those days, features of the landscape. Neither is tolerated today, and, as I see it, the Bill is a massive attempt to obliterate both, once and for all.

I do not propose to delve into the past but I believe that two matters should be borne in mind. The first is that since the last war, indeed since the publication of the Report of the Barlow Commission, attitudes have changed radically, and successive Governments, of all political complexions, have, to a greater or less degree, introduced measures to try to solve the economic and industrial problems of Wales. The overall result is that in less than 30 years there has been a vast shift of manpower from the old basic industries of coal, tinplate, slate and agriculture into new manufacturing industries in Wales. The breakdown of manpower statistics in 1946 compared with 1974 tells a graphic and remarkable story.

It is true that the economic situation is grave. It is true that we are in a world recession and that unemployment in Wales is unacceptably high. But it would be quite wrong to ignore the great changes which have taken place in the last 30 years.

Against that background, let us not always paint a gloomy picture of Wales. Wales is one of the best places in Europe to live and to work. It is a country of unsurpassed beauty with an adaptable working population. Let us, on all sides of the House, say this loud and clear so that people may know it, because now that we have decided to remain in the European Community it is important that the world should know the facts.

There are two matters in which I am deeply interested and upon which I shall value the Minister's comments when he replies. The first is the future of the Derelict Land Unit which I set up in the aftermath of the Aberfan disaster. The unit has a splendid record and is of international repute. I was glad to hear my right hon. and learned Friend say that when it is absorbed by the agency the clearance of dereliction will he accelerated. The current expenditure is, I understand, approximately £2½ million a year, and we shall be interested to know what the future plans will be under the new dispensation and what kind of financial allocation we can expect as the years pass.

Secondly—my right hon. and learned Friend also referred to this—what precisely will be the future of the Mid-Wales Development Corporation? The House will recall that I set this up in 1967 and it has done a first-class job in Newtown under the chairmanship of Mr. Emrys Roberts and with Mr. David Garbett-Edwards as chief executive. I should like to pay a tribute to both those gentlemen for what they have done.

The terms of reference which I gave the corporation enabled it to extend its activities to other towns in Mid-Wales with the Government's approval. That is why I named it the Mid-Wales and not the Newtown Development Corporation. I hope that its rôle under the new régime will be sustained and that its boundaries will be enlarged so that the corporation, with its excellent record and expertise, can take in Aberystwyth, Blaenau-Ffestiniog and other towns in the region where assistance is needed.

The one industry which I do not see mentioned in the Bill is agriculture. I make no criticism at this stage, because agriculture may be included in the definition of "industry" in the various clauses. We must never forget that agriculture and its ancillary industries—the dairy and cheese factories, for example—are of primary importance in Wales. My right hon. and learned Friend referred to Clause 2(3) in his opening speech. That subsection sets out the qualifications of members of the agency and says:
"The members of the Agency shall include persons who appear to the Secretary of State to have wide experience of, and to have shown capacity in, one or more of the following, namely, industry, commerce, banking, accountancy, finance, the organisation or representation of workers, administration, local government and matters relating to the environment".
Can we assume that "industry" includes agriculture? We need clarification, because it is not always the case and this list is an exclusive list. I am not sure that it should be exclusive in this sense; it might be better if it were drafted so as to give general guidance to my right hon. and learned Friend in his selection. I noted that my right hon. and learned Friend was modest enough to exclude lawyers from the list, but I assumed that he, myself and other hon. Members who belong to that profession might come broadly under the heading of "administration"—there is hope for us all at the end of the day—However, I would ask my right hon. and learned Friend to look at that point carefully.

The position of local authorities also needs clarification. Many of the old county and district councils before the reorganisation did absolutely first-class jobs, and my own county of Anglesey achieved oustanding work in attracting new industry into an area of high unemployment. In my view we should never cut the district councils out, because they are in closer touch with local problems than other bodies in Wales, including the Civil Service.

The Association of District Councils, of which I am a vice-president, is concerned about a number of points which I shall list briefly and which will be more appropriately dealt with in detail in committee. First, to what extent, if any, will the agency's powers conflict with the rights of local authorities to purchase land for industrial purposes? Secondly, should there not be a local authority representative, under Clause 2(3), to which I have already referred? Thirdly, to what extent will Clause 7 create a conflict between the agency and the housing authorities in the provision of housing? Finally, on Clause 11, should not local government be added to the list of interests in Clause 11 (3), in view of its rôle in providing industrial estates? I hope that the Under-Secretary will deal with these important points when he replies.

My right hon. and learned Friend, referring to the site of the new agency when it is set up in due course, said that he had not yet made up his mind where it should be. I can suggest an admirable location, but modesty forbids. If the agency is set up in Cardiff, for example, we shall be asking for an office in North Wales adequately staffed with at least one senior official. Justice must not only be done but must manifestly appear to be done.

Cardiff is a long way from North Wales and the lines of communication are not all that good. I come to London from Anglesey quicker by train than if I were going to Cardiff. Therefore, if the agency is in the South, it must have a long and strong arm in the North.

The long and strong arm will pass through Mid-Wales. But if the agency were established in Mid-Wales, I should not object.

The Bill confers wide and extensive powers on the Secretary of State and the agency. They must be used with propriety and respect for individual rights. But, if the powers are great, the problems are greater. We shall debate the agency's activities in this House not only at Question Time but on the Adjournment. If the agency overreaches its powers—[Interruption.] The hon. Member for Pembroke must not think that he is the only Member in this House who is concerned about rights. We are all deeply concerned about individual rights. The record of the Labour Governments in the preservation of the rights of the individual, with the creation of the ombudsman and certain other institutions, is one of the best in the world. Before making sweeping criticisms, the hon. Gentleman must give a little thought to what has been achieved by his opponents.

Does the right hon. Gentleman agree that there is something to be said for investigating the possibility of having a Select Committee to deal with the agency—at least until we have devolution?

I should have no objection to that. I should expect the Welsh Grand Committee to debate the report of the agency annually and as soon as possible. Indeed, it is clear from the schedule to the bill that the Public Accounts Committee will have surveillance over the work of the agency as well. Those of us who have been members of the Public Accounts Committee will realise how effective and detailed that surveillance is in practice.

I support the Bill and its objectives. But let there be no illusions about the magnitude of the task. The Bill in itself will not solve our problems. Success will depend upon three factors. The first is our national economic situation. We must conquer inflation and get on to a steady economic course. All this is "pie in the sky" unless we get that right. We know that perfectly well. We do not need to be taught that lesson by the hon. Member for Pembroke.

Secondly, the agency must have adequate resources to do its job. I am glad that the Government recognise that fact. I think that £150 million is not bad in the present economic situation. It is a good start.

Lastly, the personnel who will be engaged in running the agency—notably the chairman and the chief executive—will be crucial. They must be men of drive and determination who know Wales well in all its aspects. I hope that careful thought will be given to their appointment. I hope that my right hon. and learned Friend will appoint the chairman first and then consult him on the appointment of the chief executive. It is vital that the chairman and the chief executive have mutual confidence and that the chairman should agree the appointment.

The Bill is a historic landmark, and we hope that it will point towards more prosperous times for our country.

5.45 p.m.

I certainly echo the sentiments expressed by the right hon. Member for Anglesey (Mr. Hughes) in his closing sentence.

The broad aims of the Bill are unobjectionable to most of us. Indeed, they are desirable to hon. Members on both sides of the House. We all wish to further Welsh economic development. We all seek industrial efficiency in the Principality. The provision and safeguarding of employment throughout Wales is the common objective of all parties in this house and, I believe, of all Members. There is also a general desire to see the Welsh environment improved and the attractions of our countryside enhanced.

The means of achieving these objectives, however, are largely available in existing legislation—under the Industry Act 1972 and the Local Employment Act, and under powers available to local authorities. Whether the proposed agency will add significantly to powers already available to attain these laudable objectives is arguable. Whether the agency will prove to be the best instrument for these purposes is even more doubtful. But certainly we must not expect or require the agency to achieve miracles, as the right hon. Member for Anglesey suggested. Whatever its powers, whatever its resources, such an agency alone cannot ensure the future prosperity of the Principality.

If inflation continues and if our general industrial performance does not improve dramatically, the future for Wales must be pretty bleak. I say that without being too partisan in my criticism of the present siuation. I believe that all Governments since the war have grappled with our difficulties with only a modicum of success.

In a context of United Kingdom economic decline, the agency would indeed be faced with an impossible task. It is extremely doubtful whether any body of this kind could itself instil efficiency into a faltering and ailing economy.

We must also recognise that a strong and sucessful industrial base throughout the United Kingdom is required to sustain and pay for each addition to our administrative and bureacratic structure.

Having said as much, I echo the broad welcome which has been given to the agency and wish it well. It would be nonsensical to do otherwise.

If the agency is formed in accordance with the Bill as amended in another place, I submit that it will have a far better chance of success than if the Government insist on reintroducing some of the more objectionable features which were in the original Bill. Therefore, I regret that the Secretary of State has indicated his determination to reintroduce some of those parts which were taken out. I appeal to him, even at this stage, not to insist on bringing back into the Bill any clause or clauses which would enable the Welsh Development Agency to control companies. That is particularly objectionable. I do not like the idea of the agency forming companies, but control by the agency is particularly objectionable to many people.

The Secretary of State will be aware that many people associated with industry and business in Wales have profound anxieties and fears about that aspect of the Bill. Let the Government, if they wish, disregard for the moment the arguments and objections which we may put forward. But I implore Ministers to heed the real concern of those in industry whose whole-hearted co-operation and work will be essential not only to make a success of the agency but to make the Welsh economy recover and succeed.

During a long period in the House, a period roughly comparable to that of the right hon. Member for Anglesey, I have never before received so many communications expressing fear and concern from companies of all sizes and from industrialists of long experience and proven worth. Moreover, an agency of this kind, however gifted its leadership and membership may be, will not be an appropriate body to control and run individual companies and firms.

I support most of the broad objectives of the Bill. However, I also share the concern of industrialists and business people about the basic philosophy which appears to inspire some of the clauses. There is implicit in some clauses the idea that the agency will be able to decide the detailed future of several industries rather better than those who have spent a lifetime in them. In that sense the Bill is miscast and misconceived.

In that context the Bill has a different approach from the attitudes which were demonstrated when the Industry Act 1972 was framed. Of course, that was a Conservative measure. There is also a different approach from that which is contained in the Industrial Reorganisation Corporation Act, a measure that was introduced by a former Labour Government. In the 1972 Act, as many hon. Members will recall, intervention was contemplated only as a sort of rescue operation for a firm in difficult, and especially in cases where many jobs were involved. It was also envisaged as a kind of short-term operation to assist a company to restore its profitability. In the 1972 Act State intervention was obviously intended to take place when other methods were shown to be inadequate. In both the 1972 Act and the Industrial Reorganisation Corporation Act there was a duty on the part of the Government to dispose of their interests as soon as a company had been put back on its feet. All that is lacking in the present Bill. No similar safeguards are to be found.

The Bill appears to permit somewhat indiscriminate Government intervention for unlimited periods. Whatever the intent behind the Bill, such intervention could lead to a further unhealthy and undesirable extension of the State sector and of the powers and influence of the Government.

On the whole, during the years of Conservative Government we refrained from attempts to denationalise, to interfere or to split up State-owned companies and services. We accepted on the whole the idea of a mixed economy. We refused to create more uncertainty in industry by reversing the actions of the previous Labour Government. However, if the present process towards State control and ownership continues, those of us who believe in the superior virtues of progressive and enlightened private enterprise will surely be impelled to devise measures of curtailing the growth of State agencies and State power. That must inevitably follow if the present process continues.

It is obvious that the powers of intervention and acquisition by the development authority, without greater safeguards and without prescribed time limits, could place in jeopardy other companies and other competing organisations. That is my reply to an intervention by the hon. Member for Caernarvon (Mr. Wigley). Such companies might have to endure overlong periods of unfair competition from companies which are wholly or partly controlled by the agency.

On that very point, would the hon. Gentleman not agree that as we are now firmly part of the EEC such unfair competition is precluded by the Treaty of Rome?

One cannot foresee what influence the treaty would have. Given the terms of the Bill, should the agency acquire control of companies and run them it would in essence be unfair to the companies which are already in Wales and doing a good job in creating excellent employment and good conditions.

Given that British Leyland is taken into public ownership and it is decided to start a subsidiary company in Wales, does the hon. Gentleman not agree that the development of public enterprise in those terms could mean that privately-owned component industries would benefit by public industry in the manufacturing sector coming to Wales?

I am not talking about new companies coming into Wales, be they British Leyland or other undertakings. I am talking about the acquisition of control by the agency of existing companies or the creation of new companies. Of course, the Government can remove our fears at once if Ministers refrain from restoring to the Bill any powers to acquire control. If Ministers introduce comparable safeguards to those contained in the 1972 Act and in the Industrial Reorganisation Corporation Act, there will at once be a different mood among industrialists. That is all that they have to do. If that were done it is possible, as has been suggested, that the Bill would go through without any opposition. That is such an easy course to take that I am amazed that the right hon. and learned Gentleman does not take it. It would be a great help in restoring confidence where confidence is so sadly needed.

Much will depend on the abilities of the first chairman and the original members of the agency. The initial period could be crucial for the success of the agency. The first appointees will have the opportunity of creating confidence by their fairness. They can demonstrate that approach in their initial period, thereby demonstrating the value of the agency. By their actions they will be able to remove some of the fears which have been expressed. Therefore, I hope the appointments will be made with great care and after a great deal of forethought.

The right hon. and learned Gentleman will be aware that there was some debate on the Scottish Development Agency Bill which centred on a matter mentioned by the right hon. Member for Anglesey—namely, the qualifications of the members of the agency. It is appropriate to point out at this stage, that because such a large proportion of the geographical area of Wales is rural and because farming is still a chief industry in most of the Welsh counties, it is necessary to have in the agency persons with wide experience and proven capacity in agriculture, horticulture and rural land management. I accept, of course, that some other improved formula may be devised. As the right hon. and learned Gentleman knows, that matter was debated at some length in relation to the Scottish Bill. Further, I believe it was mentioned in relation to the Welsh Bill in another place.

In another place the Lord Chancellor, like the right hon. and learned Gentleman today, was at great pains to emphasise that the Welsh Development Agency will direct its attention to the whole of Wales and not merely to the industrial areas of the South and North-East. It will be an instrument for the whole geographical area of Wales. As an earnest of that intention, let the Government include in the agency persons with agricultural and similar experience. I know that that suggestion was turned down when it was raised before, but that is no reason for us not considering in Committee whether or not it should be done. I believe that it would be helpful for a country such as Wales.

I turn to the detailed function of the agency as specified in Clause 1(3) as amended in another place. The wording of the original Bill was to promote industrial democracy in undertakings which the agency would control. My hon. Friend the Member for Pembroke (Mr. Edwards) has already referred to this matter. For several reasons I plead with the Minister to look more sympathetically at the amended wording. First, I believe that the amended wording is superior because we reject the concept of control. We prefer a fruitful and helpful association between the agency and individual companies. The term "industrial democracy", whatever the right hon. and learned Gentleman may have said in the heat of the moment, is vague and almost meaningless. To some it would connote State ownership of a kind that exists in Eastern Europe; to others it might involve a need for worker control; to others it might mean the provision of joint works councils. Some would take "industrial democracy" to mean the participation of employees in the individual firm or company; others would prefer wider participation by trade union interests not limited to a particular company.

I prefer the wording substituted in another place, although I recognise that the wording is capable of further improvement. But it conveys the importance of promoting good industrial relations and appropriate employee involvement. I regard these as sensible terms to be included in a definition of that kind. In this respect what may be appropriate in a labour-intensive industry may not be suitable in a capital-intensive undertaking.

Is not that precisely the reason why "industrial democracy" has been left as it is—in other words, that it is better not to be too precise because of the reasons put forward by the hon. Gentleman?

I am merely submitting that the phrase means different things to different people. To some it is analogous to control by the workers themselves; to others it is the institution of co-partnership schemes; to yet others it connotes a works council. Therefore, it is inappropriate terminology. I should like to see added to the provision the words "the promotion of appropriate co-partnership and profit-sharing schemes." I believe that such arrangements tend to narrow the frontiers which have often separated those who are owners or managers from those who are employed.

I must confess that even in the amended Bill that is now before us I dislike the sound of Clause 1(4), which says:
"The Agency shall have power to do anything in Wales, and, with the approval of the Secretary of State, anything in other parts of the United Kingdom or elsewhere, which is calculated to facilitate the discharge of their functions, or is incidental or conducive to their discharge."
The phrase "to do anything in Wales" conveys sweeping, almost unlimited powers. I submit that we shall need to look at the phrase very closely indeed in Committee.

Perhaps I can put the hon. Gentleman's mind at rest, although we may want to consider the matter further and perhaps give better advice in Committee. The hon. Gentleman should read the beginning of that subsection:

"The Agency shall have power to do anything in Wales",
then forget the next two lines and go to the words:
"which is calculated to facilitate the discharge of their functions …".
It does not refer to a power to do anything, but the phrase must be related back to the functions which were stated earlier.

The Secretary of State anticipated my next remarks. The phrase refers to:

"the discharge of their functions, or … incidental or conducive to their discharge."
Is this to be calculated by the agency or by the Secretary of State or by some reference to the principles of natural justice? The terminology is far too wide and sweeping. If the agency should take a decision to acquire possession of a house, a building, or piece of land, who will decide whether such acquisition is calculated to facilitate the discharge of the agency's functions? I know it is important to interpret these matters correctly, but I sincerely hope that we shall have something a little more restrictive than the present wording.

Another matter which is not at all clear is to what extent the writ of the National Enterprise Board will run in Wales after the setting up of the agency and to what extent there may be some overlap between the National Enterprise Board and the agency. Further explanations are still necessary, otherwise industry in Wales may be uncertain as to the body to which it must apply in a particular case.

In conclusion, I repeat my support for the main objectives of the Bill. I welcome the extent to which some additional resources may fairly accrue to Wales without injustice to competitive and efficient firms already engaged in fruitful operations in the Principality.

I question the nature and extent of the powers given to the agency by the Bill and repeat my request for the sort of safeguards which were contained in the Industry Act 1972. Far too many of these powers seem to be the powers of the National Enterprise Board translated into Wales and into a Welsh agency. We must also feel some concern that the extensive powers given to the Secretary of State and to the agency are not subject to adequate parliamentary control. In marginal cases this could deter foreign firms from creating new and much-needed factories in Wales. At the same time it is within the power of the Government to remove the causes of most of the fears about some aspects of the Bill both in this House and outside, but this, I fear—as we gathered from the Secretary of State's remarks—they are not willing to do.

I appeal to the Secretary of State to seek to remove these fears. Wales is now facing a frightening state of affairs involving a high level of inflation and accompanied by an unemployment rate such as we have not seen since before the last world war. It is vitally important that we should inspire confidence among our people and not introduce measures which will frighten those who are already doing an excellent job in Wales. It is far better that we should have an agreed measure which will be seen by people in all parts of industry in the Principality to be fair. It is against this background that I make this last appeal to the Secretary of State for Wales. If the Bill becomes law, I trust that the agency will have a beneficial influence and will improve the viability of the economy of Wales.

6.8 p.m.

It is an exotic pleasure to be called to speak following the remarks of the hon. Member for Barry (Sir R. Gower) if only because the first time I had the pleasure of meeting him was at the General Election in Barry in 1966.

The hon. Gentleman's speech in quality and tone was in marked distinction to the somewhat hysterical, if not hypocritical, speech of the hon. Member for Pembroke (Mr. Edwards), who constantly amazes the House with his extravagance of speech and its irrelevance of content. We believe that the establishment of this agency—a bold new departure—will result in going a long way to remedy the cruel disparities that exist between Wales and other parts of the United Kingdom.

May I be allowed to strike a personal note? My right hon. Friend the Member for Anglesey (Mr. Hughes) referred to the siting of the agency's headquarters, and I was somewhat reassured to read that in another place Lord Lovell-Davis made clear that the agency would require offices in more than one part of the Prin- cipality. May I urge the Secretary of State—and I should be grateful if the Minister could deal with this point when replying to the debate—to consider the claims of North Gwent, Abertillery and Ebbw Vale, if not as sites for the headquarters, as what Lord Lovell-Davis called "the spheres".

The remedies so far deployed to take on the challenge of unemployment in Wales have been mostly haphazard, piecemeal and unco-ordinated and have achieved only a measure of success. It was very gratifying to read the speech of the Secretary of State in Merioneth when he went to the crux of the matter and spelt out the idea behind the concept of a Welsh Development agency. He said:
"The more difficult the period ahead, the stronger the case for bringing together and under one roof the responsibilities on the one hand for improving infrastructure, and on the other the planning and improvement of factories and providing help for industry".
That is the crucially important task that has to be tackled by the agency.

The worst affected areas in Wales are those at the heads of the valleys. In the 1960s the population in the heads of the valleys fell by 21,000, and unless immediate steps are taken this picture will be repeated in the 1970s. This is simply beyond our toleration. In recent months we have seen nearly 3,000 redundancies, with 500 in Brynmawr alone. We are now faced with additional difficulties further down the Western valley at the Conway Stewart factory. The times have gone when it could be said that the tombstones in the graveyards of Wales were marked: "Not dead, but gone to Slough".

When I listened to the hon. Member for Pembroke, I was reminded of the most extraordinary speech I have ever heard. It was made by the hon. Member for Flint, West (Sir A. Meyer), who said in the Welsh Grand Committee in 1971 that before becoming the Member for Flint, West he
"had the honour to represent Slough, which is one of the largest Welsh towns in the United Kingdom. Slough … was founded by people escaping from unemployment. There can be escape from unemployment, and there can be other Sloughs in the United Kingdom and in Wales as well".
Listen to this—it gets even better:
"if the Government hold fast to their present policy and refuse to be panicked into short-term measures, if only the Government will continue with their present policy of confronting workers".—[Official Report, Welsh Grand Committee; 28th April 1971, c. 29.]
all would be well.

Does the hon. and learned Member dispute the success, for example, of Wrexham in evolving a totally new and integrated approach to the problems of unemployment in that part of the world? Does he dispute the wisdom of seeking to make a new departure, based on new industries, rather than merely trying to prop up decaying industries, doomed to disappear by the evolution of technological change?

I think the hon. Member has missed the point, and if so that is no doubt my fault. Of course I welcome the development in Wrexham and I welcome the diversification of industry, whether in Wales or the rest of the United Kingdom, but we cannot afford unemployment in Wales. We cannot afford to lose our young people, their talents, skills and abilities to the Sloughs of Great Britain. We need them in Wales and we need the jobs in Wales, not in Slough.

I have given way once; I do not propose to do so again.

What is required and what will be at the heart of the task facing the agency is not the sort of approach adopted in the past on so many occasions and described by the late Aneurin Bevan in the graphic phrase "Colour washing the tombstones in the graveyards". I hope that the agency will not follow such policies. I do not think for one moment that it will. It is vital that we get away from the destructive, dog-in-the-manger approach that we have come to expect from the Conservative Party. We can afford it no longer.

So often in the past the social responsibility of public and private enterprise towards workers and consumers has not been developed along the right lines. I hope the agency will ensure that this public responsibility and accountability is nurtured and fostered in its activities. I hope that the agency will treat as a matter of top priority the need for a cogent policy on the distribution and issuing of indus- trial development certificates. The Hunt Committee revealed some time ago that a Department of Trade inquiry had shown that at least one in five firms had moved within the previous five years to development areas, largely because they were refused certificates elsewhere. We must restrict still further the issuing of IDCs in the richer areas of Britain, and I hope the agency will ensure that there are the most stringent controls in this matter.

Coming from the part of the world that I do, I cannot fail to welcome the provisions in the Bill on land reclamation. Before turning to that subject, however, let me deal with personal accountability, a topic which several hon. Members have raised, including the hon. Member for Barry, who dealt with the matter in some detail a moment ago. This question is a sensitive one. I have always pressed for more accountability on the part of industry both in the public and the private sectors. I shall continue to do so. This is a special case. I shall not go into the difficulties which might arise involving commercial dealings. I would have thought that Conservative Members would have been the first to realise the sensitive area into which they are moving if they ask Parliament to account for and approve of, for example, financial assistance to X firm or Y firm before the firm knows in which direction it is going.

This could have adverse consequences upon the firm, whether in the public or the private sector. In another place the Lord Chancellor dealt with it by saying that to provide for every power to require parliamentary approval in its exercise and for every direction to receive Parliamentary approval would not only overburden Parliament but would unnecessarily frustrate executive action. The inevitable delay caused by the mechanics of obtaining parliamentary consent would excessively limit the use of the agency's powers. Surely this is at the root of the objection to further accountability.

The Secretary of State is answerable to this House. In the interim there is the Welsh Grand Committee. There is no reason why there should not be a Select Committee. There is the Public Accounts Committee and so on. The hon. Member for Pembroke referred only to parts of the Western Mail leader of 15th May. What the Western Mail said, and I say this in fairness to the hon. Gentleman, was:
"To be successful it must be independent—and firmly under Welsh control. The Bill the Conservatives are advocating would have its teeth so drawn that it is unlikely the resulting agency could play any significant rôle in our economy—indeed this seems another rather gratuitous knock at devolution … To take away powers from a Welsh agency is simply to hand hard-won autonomy back … and ensure that the agency is just the Welsh arm of the National Enteprise Board. In fact the agency could boost the Welsh economy without upsetting the private sector as it stands and could give advice, assistance, and grant aid without nationalisation. To deny the Welsh people the opportunity to influence at first hand decisions that affect them and maintain that this is a function which could be carried out from Whitehall is wholly against our interests. But such proposals cut deeper. The agency is one of the few bodies which it is proposed to make accountable to a Welsh Assembly. To take away its powers is to undermine not only the agency but the assembly itself."
Coming from the part of the world that I do, I particularly welcome the Bill's provisions dealing with the environment. We in Wales, in the aftermath of the Aberfan disaster, soon became not only the front runners in Britain in land reclamation and dealing with the environment but the European league champions. We virtually had to start from scratch because, incredible though it may seem, particularly after listening to Conservative Members, only eight acres of derelict land were cleared between 1960 and 1964.

Even in the early 1970s England, as ever trailing its coat behind the Principality, had a dismal record. A total of 43 out of 102 counties and county boroughs as they then were had not restored any derelict acreage at all. In Wales today 1,300 acres justify treatment. One of the problems which will confront the agency is that every year over 100 acres of fresh wasteland are being created. We in Wales have proved that the problem of dereliction can be solved. The impediment to success has not arisen because of technical or engineering difficulties. What is required and what is now to be provided by the Government through the agency is the political will to remove the scars of past pollution and to prevent further contamination.

The agency must continue the job of improving the environment, not only because we want to improve the infrastructure for industrial purposes but also as a memorial to the thousands of men and women who sacrificed their lives on the altar of industry to create this country's wealth. The structure of beauty in the Welsh valleys still stands. Only its surface is tarnished. The agency will mean an end to the patchwork quilt approach to the problems of industrial development in Wales. It will mean an end to the "filling in the gaps left by decay" approach which has so often been the case in the past—a kind of dental economics. The agency will be an instrument by which to forge a realistic and comprehensive policy to provide for the first time a strategy for the whole of Wales. It is for these reasons that we welcome the agency and wish it a fair wind.

6.25 p.m.

At the outset I congratulate the Secretary of State on the presentation of the Bill. It is a measure with which we in Plaid Cymru find ourselves in full accord. We have as Nationalists been campaigning, if we have campaigned for anything at all, for a development authority for a long time—since the days when unemployment in Wales stood at the horrific level of 30 per cent. to 33 per cent. Many people in Wales have bitter memories of those days when hundreds of thousands of Welsh people had to leave their country for Slough and elsewhere to find work.

I recall those days to show that the need for a development authority has been long felt in Wales. Yet we have had to wait until the growth of nationalism in Scotland and Wales has compelled the Government to act. The Tories have been loth even to act now. We are continually depressed by their obstinate determination to prevent Wales living as a nation. We welcome this measure warmly but our welcome must, understandably, be qualified as a result of the tardiness of successive Governments.

The phrase which describes the Welsh position is that of "internal colony"—a phrase which is used as a title for a distinguished book published in California, which states the Welsh and Scottish situation. For generations Wales has not been governed in her best interests but rather has she been exploited by outside interests. At last, with this agency, we will, I hope, have a tool which the Welsh people can use to begin to act for themselves. After a short interim period in which the agency will be in the hands of the Secretary of State, I hope that the Welsh people, through their assembly, will be responsible for its development.

The development agency itself requires development but it has the makings of a powerful instrument. I want to refer to the issue of accountability but to give it a different emphasis from that which has so far been given to it. The bureaucratic element in this body must be diminished and the domestic element enhanced as much as possible. Although for some time the agency will, as I have said, be responsible and answerable to the Secretary of State, and through him to this Parliament—that is right, and nothing else is possible now—I hope that this will be a temporary arrangement and that it will last only until we have our own elected assembly in Wales. The agency can then be made accountable to that assembly—an assembly of the representatives of the people of Wales.

It is essential that the agency engages the interests and the enthusiastic support of the people through their representatives. I hope that its muscles will be well flexed. In particular, we need a plan in Wales—we have needed one for a long time—for balanced economic development, which the Assembly can implement. For this purpose the Assembly will require considerable powers for dealing with various aspects of the infrastructure because a great deal of leeway has to be made up in Wales after generations of comparative neglect. For example, between 1966 and 1970 the Government substantially reduced the sums spent on Welsh roads and increased the sums spent on roads in England by 150 per cent. We have a great deal of leeway to make up in this area.

However, balanced development must include both rural and industrial areas. I was glad to hear the Secretary of State refer to the needs of the rural areas. We urgently need light industry in villages and and small towns in rural Wales to stem the depopulation and to safeguard our way of life, and in many areas our language. We can all refer to small towns and villages where there is heavy unem- ployment and virtually no industry. It is essential to have this kind of light industry to maintain the population at a level which will sustain the schools, the chapels, the churches and the societies which are essential to a local community, which give vitality to rural life and make it attractive to young people. This deserves a special unit within the agency that is charged with responsibility for development of rural life in this way.

There must also be balanced development between economic, social and cultural matters. Economics should always be subordinate to social ends and social ends in this context should always include cultural matters.

In the post-war period, when my party campaigned for this kind of development agency, for some time we used the title "TVA for Wales" because the Tennessee Valley Authority was very notable as an ambitious and successful piece of planning covering large parts of seven of the states of the United States. Most commendably in that experiment it regarded the whole of the society of that area as a "seamless web". This is a good phrase.

In this way the national community of Wales must be seen as a seamless web. Great care must be taken to assess the effect of every political and economic action on each of the social, cultural and linguistic aspects of Welsh life, and to ensure that the national community is developed as a whole.

Order. I know of 14 hon. Members who wish to speak in this debate. I hope that those who catch my eye will be reasonably unselfish.

6.34 p.m.

My right hon. and learned Friend the Secretary of State for Wales and my hon. and learned Friend the Member for Abertillery (Mr. Thomas) made passing references to our great fellow countryman, Aneurin Bevan. It was Bevan who said that the Welsh were the most contentious nation in the world, and I do not doubt that. It is the only area in which in any pub, club or gathering of people at the drop of a handkerchief and within 30 seconds flat one can become involved in political argument of a high order which is not only tolerant but is usually extremely well-informed.

Therefore, I find the argument of the hon. Member for Pembroke (Mr. Edwards) somewhat saddening. Whether he was dazzled by the possibility of conquering some lush empire in a future Government and leading an army against this wicked interventionist Socialist gathering on these benches, I do not know. What has happened is that he and others like him have been reduced to making all kinds of apologia, because there is more unanimity in Wales today over this issue than I have seen for a long time.

Even the Welsh Nationalists are joining with the thinking on the Labour Benches. I could even find it in my heart to forgive some of their recent activities in my constituency. However, in reality, instead of the hon. Member for Pembroke finding that he has an army behind him, he finds that it is a group of people riven with dissensions, including the Welsh CBI. Even that Press organ—hardly a pillar of Socialist thinking—the Western Mail chides him like a naughty schoolboy for his attitudes. In this debate he is reduced to carrying the tattered remnants of his flag across to these benches and saying "If you will please let me keep this little bit of flag, I am willing to join you, although you are my enemy." He does all this, as did the hon. Member for Barry (Sir R. Gower), in the name of saying that this is the State trying to effect a massive transference of power. This is the pattern that is running through current legislation.

As a somewhat less intelligent Welshman, I was always under the impression that many of the people who sent me here did so precisely because they wanted to transfer economic power into their own hands and to transfer powers of decision that affect their lives very deeply into organs that were representative and closely linked at local levels to themselves, so that ideally they might at long last be allowed to have a voice in deciding their future and the future of their children.

If Conservative Members think that we shall be frightened, they had better think again. There are enough of us on these benches who still adhere to what many on these benches refer to as old-fashioned Socialism. We accept the need for the transfer of power and are determined to achieve it. The messing about as regards amendments to the Bill in another place will quickly be remedied.

The hon. Member for Carmarthen (Mr. Evans) referred to the deep trauma of the past, through which so many of our people went. Certainly in heavily industrialised parts of South Wales we saw it at its deepest. It was in my constituency that a certain illustrious person burst into tears and said that something must be done. Something must still be done. We shall see that it is done.

In yesterday's debate on the Scottish Development Agency this was a recurring theme. The Secretary of State for Scotland pointed out that most of the guilt for what has happened in Scotland rested fairly and squarely on the shoulders of people who had run the previous economies of Scotland and who had been responsible for lack of investment. They had regarded the smaller units in Scotland as capable of being sacrificed—they called them their marginal Scottish interests—in order to buttress and sustain their large units, which are outside Scotland. Wales has a similar problem, because although we are heavily dependent on publicly-owned industries, which many Labour Members want to be socialised, we accept that Wales, as a land of small communities, has always been dependent quite significantly on small to intermediate businesses. This is a function which a Welsh agency can fulfil and which no other organisation can.

Many of the specifics in the Bill have been touched upon. I shall most certainly not be repetitive. However, we know the history of the past and we hope that we can find some of the answers to it. While we are trying to give our answers in the Bill, let us not be churlish and, because dark clouds are still hanging over Wales, deny the gratitude and respect which we owe to organisations which have very valiantly carried on up till now, the many bodies to which the Secretary of State referred. But the plain answer—anyone in local government will know this—is that the time wasted by local authority industrial development committees, by Members of Parliament and by other people who are desperately concerned about the situation, in going from one body to another, taking an interminable time to try to effect some kind of palliative to a desperate situation, absolutely calls out for the bringing of these organisations under one umbrella, so that the route can be shortened and action can be far more effectively and speedily carried out. I think that despite some of the fears they have expressed, this is why so many local authority organisations have given an unstinting welcome to the Bill.

I am deliberately omitting many of the points that have been made hitherto. I want to sec this development agency for Wales have the imagination to do some forward looking. The powers given to the agency are set out in Explanatory and Financial Memorandum. It is to establish and to carry on industrial undertakings. Although the signs may not be all that significant as yet, there are things happening in Wales which portend nothing but good for the future, in our ability to meet the challenge of modern technology and to evolve entirely new patterns of industry.

Perhaps I may mention just two instances with which I have been quite deeply involved over a number of years. There is absolutely no doubt that some of the leading thinking, research and experimentation in recycling of waste products has been done in Wales by Professor David Hughes, in the microbiology department of Cardiff University, and by Mr. Clive Jones, an industrial chemist formerly of British Silicones and now the industrial liaison officer for the Wolfson Laboratory. These inspired and dedicated people have solved most of the problems of recycling most waste products.

My own party—I addressed the meeting in Blackpool on this subject—has formed a group on the recycling of waste products. It was put into our manifesto that nationally this process could be worth £400 mililon a year. I would say that it goes far beyond that. This was also a subject of Sicco Mansholt's survival blueprint for mankind—that the recycling of waste products could be done even on a European scale.

Out of my pride in being a Welshman and as research work and pioneering has been done, I should like to see what has been costed out and planned on the drawing board—the establishment of a labora- tory specifically for this work and the establishment of the first pilot plants of a completely new industry in my country. It is not only feasible. It wants only a modicum of interest to spark this off, and here is a growth industry which can have a few parallels in Britain. As well as its saving to the national purse, its value in focusing world attention on the forward-looking nature of the Welsh approach to technology would be quite dramatic.

Turning to the side of pure inventiveness, I have just been in communication with a man whom I have known for many years and with whom I have kept in touch. It has taken him about three years to try to get a foolproof patent, but here in this field we have in working order, as a pilot plant, an oil and water separator which achieves 98·5 per cent. efficiency. It has had its own booms and sluices designed, and it could sail into a slick such as that left by the "Torrey Canyon" and clean it up in no time.

If we have the interests of an agency such as this to foster and to encourage, there is nothing in technology and inventiveness that other peoples can do—I do not wish to cast any animadversion—which cannot be reached by the Welsh people. I hope to see this day come.

I turn briefly to the other major point in the Explanatory and Financial Memorandum—the environment. Here in particular the people of Wales owe a debt of gratitude to the inspired work of the derelict land unit attached to the Welsh Office, which should receive public acknowledgment far more than it has done hitherto. My own area, being a very heavily derelicted one, can pay tribute to this unit. There are at present two truly inspiring pieces of land clearance and reclamation taking place. I pay tribute also to the speed with which the action can be taken. Within a month of a date being given for a colliery closure, the announcements were made for the clearance of this and the restoration to its pristine beauty of a truly glorious Welsh valley. We shall indeed, as the Secretary of State said, increasingly see "How green is my valley", not how green was my valley, becoming a predictable event within certainly the lifetime of our children.

Some fears have been expressed over the set-up on the derelict land reclamation side. I fully agree with the Secretary of State that the people who have shown such expertise, speed and imagination should have a full function to perform now under this agency. They are certainly capable of getting this job done, and done thoroughly.

Under the Bill there is provision for the agency to clear land and either to make use of the land itself or to adopt the generous approach of offering it to the local authority on favourable terms. The agency can give land free of all charges to the local authority for development which is approved by the Secretary of State. This again is a very significant move forward.

On the financial provisions, I can well understand the perturbation which, I believe, lay behind the question asked by the hon. Member for Caernarvon (Mr. Wigley) during yesterday's debate on the Scottish Development Agency about the absence of a time limit under which the initial expenditure would be phased. Of course the same answer was given—that this would be a matter for the Secretary of State and that there is always the safeguard that the agency must come back to the Secretary of State, who in turn must come to this Parliament for further sanction for financial expenditure.

Inherent in the hon. Member's question was a further one which disturbs me in the current economic climate: that however short the expenditure phasing may be, it is bound to be eroded by the factor of inflation. We should ask whether there is to be any kind of reverse procedure, any building-up procedure, to offset totally or partly the effects of the erosion of the original sum of money. This is a subject on which one could speak in extenso. I end by saying that in my party in Wales we have dreamed for a very long time of having a central body of this kind, just as in the total field of devolution, even in my father's time we were talking of a Welsh Assembly with unitary authority. A year or so ago I had a conversation with the hon. Member for Merioneth (Mr. Thomas) on the subject of where we should go. Within those terms I congratulate my right hon. Friend the Secretary of State. I hope that the passage of this legislation through the House will be expeditious and I very much hope that the deadline for the structuring of the agency will be completed by the end of the year.

6.53 p.m.

The need for some kind of development agency in Wales has been obvious for some time. More than in many other parts of Britain, Welsh Liberals have felt the need for some cohesive policy to prevent the decay of existing industries and to prevent a continuation of the rural depopulation which has taken place since the First World War and even since the days of the lead mines. It is now very necessary to develop the industrial potential of Wales to its full capacity and to make an effort to overcome the serious problem of unemployment throughout the Principality.

The possibility of an expansion of the oil industry off the Welsh coast also makes it imperative that the environment should be protected, and I believe there should be strict controls imposed on any major building plans put forward by new industry. With tourism making an important contribution to the economy, it is important to preserve the features that have made it so successful. Above all, we must make Wales a pleasant place in which to live, while providing the necessary job opportunities. I invite hon. and right hon. Members on both sides of the House, if they have a few days off during the Summer Recess, to come to the Teifi Valley to see the environment, which represents the very best scenic beauty which we have in Ceredigion, and also the Rheidol Valley, where the Secretary of State enjoyed his boyhood days. That is the type of life we need in Wales—a pleasant environment, plenty of work and a healthy economy.

I should like to congratulate the Secretary of State on making a move in the right direction in making the concept of such an agency a possibility. We can now be more hopeful of the Government's intention to safeguard industries in Wales, we may see the setting up of advance factories in Wales in areas that really need them and we may then see the stemming of the rural depopulation which has been such a depressing feature of the Welsh way of life in recent years. With the right kind of encouragement, the economic life of these areas will revive. If only the Welsh agency would slow down the drift of young people away from my constituency I would be well pleased. Only 8 per cent. of my constituents are working in manufacturing industry, so there is a great imbalance between the self-employed and the employed in Ceredigion. I have in my constituency towns like Tregaron, Aberaeron and New Quay which have no industry of any kind. I hope that when the Welsh agency is set up such towns will be remembered and light industry will be introduced into them.

Good intentions are one thing. The way in which intentions are carried out is another. I agree that there is a great need and a desire to plan ahead and to bring to an end this stop-go system that has bedevilled all planning over the past few years, with one plan quickly succeeding another, causing confusion and a certain cynicism among those who might be attracted to invest in Wales. One could say that the Welsh Development Agency is yet another alteration of regional policy reflecting merely another aspect of parliamentary dogma.

I would be grateful if the Secretary of State would assure us that this is not just another exercise in spending money on a massive scale in order to implement social theories. I understand that the overheads alone are likely to be in the region of £2·5 million. Can he explain to the House by what criteria the success of the agency will be measured? As it stands, it has three separate functions which do not lie easily together. The first involves the encouragement of industry and commerce, which presumably would have a commercial return. The other two functions involve the use of public money, which would be given in the form of grants for environmental development and protection and powers to take over ailing firms under the terms of the Industry Act. Does the Secretary of State believe these functions to be compatible?

I should also like to seek the assurance of the Secretary of State that the policies of the Government do not further exacerbate the position of small firms and industries already in Wales, so that they are forced to seek help under the Industry Act. There is a sizeable section of the community already feeling a certain sense of injustice at the treatment being meted out to them by the Government in the form of punitive taxes. I hope that these people, who form the backbone of the economy in rural Wales, will be considered. I am referring to the self-employed.

I said that we had only 8 per cent. working in manufacturing industries in my constituency, but in Ceredigion over 30 per cent. of the electorate are self-employed, the highest percentage not only in Wales but in Britain. Will the Secretary of State agree to support private enterprise and the self-employed? Or does he believe that mere nationalisation is the answer to our economic problems in Wales? I hope not.

Is the Minister aware that 60 per cent. of school leavers are unskilled and untrained? If we are to have more industry and more factories, would it not be possible to look into the possibilities of developing technical training in Wales for those who wish to enter the various industries? One could also make out a very strong case for retraining for those who may be made redundant in certain industries and could be channelled to other jobs. I should like to see evidence of more Government thinking along those lines.

I have lived in Ceredigion all my life, and am now middle-aged. It is very disheartening to see our young people leaving the rural areas year after year, never to return except for a few holidays now and again.

The most serious defect in the Bill is that it has been drafted with no reference to the proposed Welsh Assembly. This indicates that the Government still refuse to take devolution seriously, in spite of the serious recommendations of the Kilbrandon Report. We have already heard this week that no separate Civil Service will be provided for the Welsh and Scottish Assemblies. The setting up of the Welsh Development Agency before a Welsh Assembly has been formed makes nonsense of any attempt at a unified policy for Wales.

It would appear from the Bill that the proposed agency is completely dependent on the whim of the Secretary of State for Wales. One might say that it is the creature of the Secretary of State, as he, for example, even appoints the chief executive. It is entirely wrong to have the chief executive appointed in that way. Is it possible for the agency to make an independent decision? This dependence on the agreement of the Secretary of State in so many ways makes the whole agency too political. This is an area that should be free of politics if we are to have continuity of policy.

There is not sufficient demarcation in the Bill between the agency and the National Enterprise Board. I have said before that it is important that the affairs of Wales should be dealt with by people who understand Wales, and I see here evidence of the desire of those who wish to nationalise everything in sight to keep control of Wales.

I believe that it is of the utmost importance for the future of Wales that its development should be kept as far as possible in Welsh hands. The way to do that would be to ensure that the agency was answerable to an elected assembly in Wales, an assembly with legislative powers and with effective control over the economy.

On 1st May I put a Question to the Secretary of State for Employment, asking him to list the 10 employment categories which had had the biggest job loss during the past five or 10 years. It is interesting to note that during the past five years the biggest losses have been in agriculture, forestry, fishing, mining, quarrying, metal manufacture, gas, electricity and water.

Before we can entice industrialists to Mid-Wales we need better communications. I hope that the Minister who winds up the debate will say how much money will be spent on road and rail communications into Mid-Wales.

Today we have been discussing the Welsh Development Agency, and in a few months we shall be discussing the Welsh Assembly White Paper. We must ask ourselves where the money is to come from. If we are to conquer inflation, and if we are to have a Welsh Assembly and a Welsh Development Agency, does the Minister believe that we need control of prices and incomes by statute?

I am very sorry to have to refer to a statement made earlier by the Secretary of State, who blamed the Liberals for opposing the setting up of a rural development board a few years ago. I am proud to say that I was one of those Mid-Walians who stood out against the board. I challenge the Secretary of State to present the same type of board with compulsory powers to the people of Mid-Wales once again. It will not be acceptable. In the last General Election Labour lost control of Carmarthenshire. Merioneth and Cardiganshire owing to the attempt to set up the rural development board. If the Secretary of State tries to do it once again to the people of Mid-Wales, perhaps he will lose more seats in Wales.

7.7 p.m.

The broad welcome for the Welsh Development Agency in the speeches of the hon. Members for Cardigan (Mr. Howells) and Carmarthen (Mr. Evans) illustrates the acceptance of the agency by the substantial group of political forces in Wales and the extent to which the Conservative Party is out on a limb, on its own in Welsh terms, on this matter.

In listening to the speech of the hon. Member who led for the Opposition, the hon. Member for Pembroke (Mr. Edwards), who represents little England beyond Wales, I felt how significant was the location of his constituency, since he spoke in a wholly different tone even from that of the Welsh CBI. Although it has reservations about the Bill and the agency, the Welsh CBI has said that it gives support in principle to Government proposals for a Welsh Development Agency, though it enumerated certain reservations. Never again shall I refer to the Conservative Party in Wales as the mouthpiece of the Welsh CBI, because the Conservatives' views are less progressive than the views of that body in relation to Wales. The hon. Gentleman must already feel somewhat unsure about the battleground that he has chosen. He must consider how ill-chosen it was.

The agency is a new instrument for restructuring and modernising our Welsh economy. It gives more powers, comprehensive powers, and more funds for development within the Principality. I accept that the fundamental battle on allocation of resources must still be fought within the British Cabinet, but it is a useful additional weapon.

One cannot be satisfied with the existence of the weapon itself, because the weapon is not an end in itself. Its effectiveness will depend on the manner in which the powers of the agency are exercised within Wales. I think particularly, for example, of the quality of staff who are to be recruited to man the agency, and the back-up resources for decision-making within the agency. I hope that there will be someone at the head of the agency with real practical experience of industrial decision-making within Wales. Its effectiveness will also depend on the extent of the readiness of the agency to pursue a long-term strategy for the Principality and not to be diverted to short-term unproductive job preservation at all costs. Indeed, for industrial planning there has to be a substantial degree of continuity, which we have not seen in relation to the various regional location incentives of either Government.

On one point I wholly agree with the hon. Member for Carmarthen: that we need a plan for Wales if the investment decisions taken by the agency are to be effective. We need to clarify our goals within the Principality, otherwise investment decisions will be haphazard and not directed to particular ends.

We need, for example, to build on the existing foundations, in particular to obtain manufacturing units in Wales downstream from the existing heavy industry. I have in mind industries making consumer goods from chemical production, sited in the area of Baglan Bay, and aluminium-using industries centred in North Wales.

We need also to take more care in attracting linked industries to areas which are relatively close together in order to avoid the haphazard grouping of industries. We need more toy manufacturing within the Swansea area, and more electronic component manufacturing industries in the area of Aberdare. If such clusters of linked industries are achieved in the Principality, a number of very important external benefits will accrue. For example, we shall have educational courses at local technical colleges which can be geared to the cluster of industries within those areas. Similarly, specialist servicing and stock-holding firms will be attracted as a result of the cluster of industries, but this must depend on clarifying our models and having plans for the Principality so as to know where we are going.

Many questions will remain unanswered by the Bill, such as the relationship between the agency and the National Enterprise Board, and also questions of financial accountability and whether, for example, there should be a form of public dividend capital. A large portion of the activities of the agency cannot be costed in commercial terms anyway, certainly not in the short term, such as the derelict land facilities, but there must be some yardstick by which the effectiveness of the agency can be measured.

In passing I will say one thing about the location of the headquarters of the agency. I am very much concerned with the danger of overcentralisation of administrative facilities within Wales in the Cardiff area. I shall not make a parochial point in relation to Swansea. My own view is that, in looking at the needs of Wales at the moment and in prospect, it would be an imaginative example and an act of faith if the headquarters of the Welsh Development Agency were to be sited somewhere in the Heads of the Valleys area. This would be a focus for an important service grouping within that area which needs it.

I am glad to have the support of my hon. Friend the Member for Aberdare (Mr. Evans), but I hope that we in Wales learn from England's example of having an administrative capital and try to diversify administrative jobs as far as we can away from Cardiff. The real need now is for some jobs to buttress the economy in the Heads of the Valleys area.

My second point is that I see the agency as a new means of co-operation between Government and industry within the Principality. The old confrontations and frontiers are blurred, and hon. Members on both sides of the House must come to terms with this fact. We live in a mixed economy. We need a genuine mix and a partnership. There are areas which are now wholly nationalised or where 100 per cent. nationalisation is in prospect, where there could be a public equity holding but not a complete holding. This might have been an appropriate solution for Bristol Channel ship repairers.

Conversely, there is a substantial case for a governmental stake in profitable private industry. I accept the interventionist rôle which my right hon. and learned Friend the Secretary of State outlined for the agency in this respect, as long as we remember that Government investment is not some form of cornucopia for invalid industries, that we need a healthy scepticism concerning Government and business judgment and that we need to give a degree of independence, within limits, to the agency to back its own judgment. There has to be a much clearer means of monitoring the achievement of the agency than appears at present to exist, in particular some more extensive means of parliamentary control.

The improvement of the environment is the last of the duties enumerated for the agency in Clause 1(2). It is a clear duty. It raises many questions of an urgent nature because of the prospect of Celtic Sea oil. What priority in Wales shall be devoted to environmental factors? Will it be a residual factor after other factors have been taken into consideration, rather like the Government's reaction to those of us who protest about the lead content in petrol and are told that it is a health hazard but we must put up with it because we are so dependent on the motor industry? In other words, improvement of the environment is a good thing in its place. In my view, and drawing upon Welsh experience, that place should be at the forefront of our considerations, learning from the shortsighted decisions of the past.

Environmental decisions will have a significant effect on industrial location policies as well. I ask how the environmental considerations will be fed into the decision-making process within the Welsh Development Agency. Will there be a special section of the agency. Will there be a specialised committee? Will there be a board member charged specifically with responsibility for the environment? Inevitably there will be a conflict. I hope that the decisions reached will not be blurred and that the people of Wales will be able to participate in these conflicting decisions as a result of an open debate.

The Development Land Unit is one of the great success stories in Wales. It is only sad that we had to wait for another round before we were stirred into action on this front. I hope that the agency will start with an imaginative and perhaps a model scheme of what can be done in co-operation with local authorities—and where better than in the Swansea Valley, which is still the largest area of industrial dereliction in the whole of the United Kingdom?

There is now a blueprint for the development of that valley with the zoning of industrial areas and recreational areas. It is an imaginative blueprint which has been drawn up by the local authority. It may be that one of the most signficant activities of the agency could be working with the West Glamorgan and the Swansea City Councils in revitalising the whole of the Swansea valley. That would be an excellent example of co-operation with local authorities.

This agency, welcomed by almost all the political forces in Wales and by our Welsh people and endorsed at the last two elections as the policy of my party, will, I am confident, be of considerable benefit to the Principality. It is an exciting organisation, and in common with my colleagues and the bulk of the Welsh people I wish it every success.

7.20 p.m.

It would be churlish for any Welsh Member, concerned though he may be about what may happen to this Bill at a later stage, to deny that, in the form in which it has emerged from another place and is being presented to the House, it contains very considerable advantages for Wales. It is obviously a most desirable step to have a single central body to co-ordinate the efforts of a number of existing bodies, the purpose of all of which is to develop the Welsh economy and to bring industry to Wales. No reasonable person could possibly quarrel with such an objective. We have been reminded today of the state of unemployment in Wales. Ever since April it has been at its highest monthly level since the last war.

In speaking of the desirability of establishing a single central body of this kind, I do not mean in any way to denigrate the sterling work which has been clone up until now by man local authorities and voluntary bodies. However, there is no doubt that there has been a lack of co-ordination in these efforts in the past, and this is one of the weaknesses which the Bill, rightly, seeks to remedy, although it is to be hoped that the agency will continue to rely upon and make the fullest use of the spirit of co-operation in both the local authorities and the voluntary bodies.

Criticism has been made by some members of my party in another place, and yesterday in this House when the sister measure relating to Scotland was considered, that the creation of the agency and its Scottsh equivalent amounted to a proliferation of existing bodies. Certainly there are many of them. But I do not think that this charge is made out, because part of the purposes of the Bill is the co-ordination of the efforts of existing bodies.

Another aspect of the Bill which I hope will command universal support is the duty which it imposes upon the agency to develop and redevelop the environment in Wales, to grant-aid local authorities in carrying out derelict land clearance works, and to carry out such works itself. No one doubts that much remains to be done in this respect, and again I say that without any reflection upon what has bene done already in this regard. Anyone who knows Wales well will be aware of the tremendous efforts which have been made, especially in the South, in clearing up the industrial dereliction which has existed for so long. I am fortunate in that I represent a constituency where that problem does not exist at all.

I understand—and perhaps the Secretary of State will confirm—that it is intended that local authorities should continue to play a most important rôle in this work, and that agency schemes will be undertaken only after full consultation and agreement with local authorities. This should apply just as much to major environmental schemes as to others. It is important that this should be the case. I ask the Secretary of State roughly what proportion of the money that the agency is likely to get—whether it be £100 million or £150 million—will be applied to the derelict land reclamation programme. A figure of £5 million has been mooted, which is something like double the present expenditure. Perhaps we can have some more information about this.

So far I have had nothing but praise for the principal objectives of the Bill, and, were it to remain in the form in which it has appeared before us, I could leave it at that. However, as we are all painfully aware, substantial and far-reaching amendments were effected in another place. As regards one of them. we have heard from the right hon. and learned Gentleman that the Government are quite determined to undo the good work done in the other place. Therefore, it would be unrealistic to discuss the Bill without considering the effect of the reinsertion of the provision which, temporarily, has been extracted from it. Very rarely has so much attention been given in a Second Reading debate to what, for the time being at any rate, does not appear in the Bill under discussion. The same applied yesterday to the sister measure relating to Scotland.

In terms of the injection of financial assistance into Wales, the Opposition, or, rather, the part of it to which I belong, feel that the 1972 Industry Act, despite the scorn poured on it by the Secretary of State, provides all that is necessary. Moreover, it contains highly desirable safeguards against such assistance being used to nationalise firms and unnecessarily to increase the size of the public sector.

The safeguards embodied in the 1972 Act were, firstly, that the Secretary of State had to be satisfied that assistance would not be given in any other way than by the acquisition of loan or share capital. Secondly, he could not acquire more than 50 per cent. of the equity share capital. Thirdly, he was required to disposed of any stock or shares as soon as practicable.

We think that that goes far enough. As we are aware, these safeguards are swept away in the Industry Bill, and, if the Government have their way with this particular Bill, there will be no limitations of the kind that I have mentioned on the agency if and when it wishes to acquire stock or shares in a privately-owned company. Accordingly, the agency would be able to take over control of companies without restriction and even without the agreement of their boards of directors. It could buy its way into profitable industry and set up its own enterprises in direct competition with existing companies in the private sector.

Although it has been argued that competition between agency-created companies and privately-owned ones would be fair, one can be forgiven for being a little doubtful on that score. For an established company in the private sector, the possibility of investment is very difficult at present, as we know, and it could hardly compete on equitable terms with a company or undertaking set up by the agency and equipped by it with modern plant and machinery.

Let me make it clear on behalf of all members of my party that we do not suggest that the agency should not be able to provide financial aid to companies in Wales, that it should not be able to invest in the equity of a company which it felt it desirable to assist, or that it should not have directors on the boards of companies in which it was financially interested. We draw the line at the point where the agency would run companies or undertakings which it had taken over or formed itself.

We feel that such activity is not necessary to enable the agency to perform its functions, and we also feel that the agency is not well suited to enter into industrial management, which can best be performed by people experienced in that field. It follows that, if the agency were to move into company management, over the years there would be a continuous enlargement of the public sector into areas of activity for which it was quite unfitted.

The powers which the Government wish to give the agency reflect those given to the National Enterprise Board under the Industry Bill. If they are restored under this measure, the Welsh agency will truly act as an arm of the National Enterprise Board. I use that much-quoted expression, even though exception is being taken to it, as a succinct description of the situation which would arise. It represents an extension of State control into the private sector without adequate parliamentary control. We feel that that is not the way to win the confidence of private industry, which should be the principal concern of the Government if they seriously intend to attempt to remedy our economic ills.

I am not opposed to the establishment of the agency or to its being invested with the eight functions set out in the present Bill. On the contrary, I welcome it. In carrying out those functions, it can do much good for Wales by exercising the powers given to it by the Bill. Let it so remain. Let there be no addition of any other function, or functions which do not enjoy the full and, indeed, enthusiastic support of hon. Members of all parties representing Wales in this House.

7.31 p.m.

I welcome the contribution made by the hon. and learned Member for Denbigh (Mr. Morgan), who, like his colleague the hon. Member for Barry (Sir R. Gower), welcomed much that is in the Bill. I hope that those hon. Members, in common with the remainder of Members of Parliament, will vote in support of this measure, which will fulfil the desires of the people of Wales.

The Secretary of State said that this was a historic day for Wales. Yesterday there was a debate on the Scottish Development Agency. That was a historic day for Scotland. Next week the Industry Bill will provide a historic day for Britain. Circumstances will change for the better if these measures are implemented by Parliament.

I regret the delay which has occurred as a result of the obstructive tactics of, I was going to say, the Conservative Party. But perhaps I should not include all the Welsh Members of the Conservative Party in that category, although I include the hon. Member for Pembroke (Mr. Edwards), who led the opposition to this measure. The constituents of Denbigh and Barry will at least know that their Members of Parliament showed some restraint. The people of Pembroke will realise that their Member of Parliament expressed his all-out opposition to the Bill. I say "all-out". I wondered whether political schizophrenia had been demonstrated. Some hon. Gentlemen delayed the measure going to the Welsh Grand Committee. One or two other hon. Members representing other constituencies have taken part in the debate, but the contributions to this debate have, in the main, been made by Welsh Members.

The debate could easily have been taken upstairs in Committee and the matter could have been brought to the Floor of the House at a later stage. Parliament has a heavy programme of legislation. Not only are the Government fulfilling the promises made in our policy statement but we have had to undo the harm of legislation carried forward from the previous administration. That is why more legislation has been brought before this Chamber than for a long time. A measure such as this could easily have been taken in the Welsh Grand Committee. It is deplorable that the Conservative Party's obstruction should have prevented the Second Reading of this measure being taken at an earlier date. Instead of having been debated first by this elected Parliament, the measure has arrived from the other place.

I was pleased at the contribution made by the Lord Chancellor, an eminent Welshman, who moved the Bill admirably in the other place. I am personally attached to him because he came from the school in Wales at which I taught.

The Secretary of State demonstrated the need for this measure. The Opposition spokesman while addressing us today, discussed the economic situation rather than the Bill. The impression he gave was that the economic ills confronting Wales, as well as those in Britain, had been caused by the Labour Government. He neglected to mention that we were passing through a world recession. He spoke as though we were experiencing a phase of which we were unaware when the Conservative Government were in power. The Labour Party manifesto for the October election said:
"Britain faces its most dangerous crisis since the war. The Labour Party makes no attempt to disguise this. On the contrary, at the time of the February election, we took the British people into our confidence and shared the realities of our daunting problems. We inherited a three-day week, unlit streets, unheated homes and work-places. And worst of all, a wounded national economy, made all the more serious by the socially divisive policies of the previous Conservative Government, with its deliberate confrontation with the organised working people of our country."
Those were the opening sentences of the manifesto which we put before the people.

There is now a world economic recession. That situation exists in America, Germany, France and Italy. The Opposition give the impression that all the troubles which we face are due to the policies of the Labour Government. What shabby nonsense. We are faced with serious financial, economic and industrial problems. I believe that this vital, valuable new machinery for assisting in the solution of the problems of Wales has been held up because of the delaying tactics of the Conservative Party.

What are the functions of the Welsh Development Agency? They are, first to further economic development, secondly to maintain employment, and thirdly to improve the environment. It may finance or establish industrial undertakings and take over the functions of the Welsh Industrial Estates Corporation.

On 20th November 1974 the Prime Minister announced that the ministerial responsibility for selective regional assistance in Wales under Section 7 of the Industry Act 1972 would be transferred from the Secretary of State for Industry to the Secretary of State for Wales on 1st July 1975. That day has been referred to as "free enterprise day". In Wales it will be called "national enterprise day" because the tasks performed by the Department of Industry will be transferred to Wales.

The White Paper dealing with the regeneration of British Industry said that it had been decided that appropriate functions of the National Enterprise Board should be carried out in Scotland and Wales by the respective development agencies. In July 1974 the Government announced their intention to establish a Welsh Development Agency responsible to the Secretary of State. Its aim would be to strengthen in an effective way the instruments available for promoting the development of the Welsh economy and undertaking major environmental projects. That had been outlined in the manifesto of the Labour Party in Wales. That manifesto was accepted by the majority of the people of Wales, as in the election the number of Welsh people who voted for the Labour Party equalled the number who voted for the Conservative, Liberal and national parties.

That document explained that the agency's major responsibility would include tackling industrial decay, unemployment in Wales, the encouragement and establishment of new enterprises and the provision of new industrial estates and factories, paying special attention to those industrial areas which had suffered from the worst effects of the decline of the older industries.

The manifesto made it clear that the agency would play a key role in environmental matters, in which it would work closely with local authorities. This Bill is the fulfilment of the promises made in that manifesto.

In its role the agency will bring new resources, both of finance and of professional skills, to bear to promote industrial and environmental development. The two are closely interrelated, and the agency's twin objectives will be to accelerate economic and industrial development in Wales and to create the environmental facilities conducive to such development. The agency will be working with the National Enterprise Board in promoting industrial support and development. Labour Members make no apology for the fact that the Government are setting up the National Enterprise Board. It is all very well for Conservatives to talk about the glories of the private enterprise system, but it is difficult to sell that system in Wales.

Reference has been made to the book "How Green was my Valley", which was written some years ago. We know how the coal industry had declined at that time, when the mines were privately owned. Who is to deny that the public ownership of the coal industry has been of great benefit to the people of Wales and to the mining community? I recall what was written in that book by Richard Llewellyn about a strike in a mining valley. Meat was scarce. There was butter only on Sunday and the tea was made without milk, without sugar and without tea.

The hon. Member for Cardigan (Mr. Howells) referred to the Tennessee Valley Authority which dealt with the problem described in Steinbeck's "Grapes of Wrath". Wales has never had a development authority. There is a need for an agency to bring industry into Wales. There has been private enterprise, but even the former Leader of the Opposition stated that Tory Governments had failed to get private enterprise to invest in manufacturing industry. Where private enterprise has failed, surely we should put public enterprise in its place.

We need to continue the task of dealing with dereliction to stimulate environmental regeneration. The Derelict Land Unit of the Welsh Office has done much to solve this problem in recent years. It is tragic that we had to have the Aberfan disaster before we got around to dealing with derelict land. Since then much has been done in my constituency in the Cynon Valley, from Aberdare to Mountain Ash—the Queen of the Valleys—to remove the coal tips and the industrial scars. I hope that improvements of this nature will continue during the years ahead.

Our main problem is unemployment. I recognise that we are passing through a difficult economic and financial period and that much has been done by regional policies, but a serious situation is developing in my constituency. A factory that was brought into Aberdare—Levex—was closed down but it has now been opened again under a different name. There is a light engineering works on the Hirwaun Industrial Estate in which the workers work hard and are prepared to cut their wages to keep the firm going, but on Monday morning when they went to work they were told that on Thursday their jobs would finish.

Complaint has been made mat the Bill deals with industrial democracy. It is about time we talked about industrial democracy. It is about time we realised that, in addition to the people who invest capital in industry, there are people who invest their labour in industry and who must be consulted before decisions are taken about the closure of firms.

More recently, the Girling firm in Aberdare has been threatened with closure. Talks are going on, and I hope that they will meet with success. The unemployment situation in the valleys is serious, and the Bill will play a positive part in creating job opportunities in the area.

The only happy industry is the coal industry. We see at pitheads notices saying "No vacancies". The coal industry is moving forward and productivity is increasing. At the beginning of last year we recognised that the mining industry was in the doldrums, and there was conflict. Now the industry is producing coal in great abundance to meet our energy requirements.

I should like to have answered the argument of the hon. Member for Pembroke, who opposed the Bill, but he deployed hardly any arguments. In the latter part of his speech he turned his attention to suggesting amendments to the Bill. It is strange that someone who opposes a Bill should say how he would improve it. The Conservatives must make up their minds where they stand.

In the debate on the Scottish Development Agency Bill last night the hon. Member for Glasgow, Cathcart (Mr. Taylor) summarised the reasons why the Conservatives opposed that Bill. First, he said that the Bill was not needed. The need for the Welsh Bill has been proved by this debate and the House of Lords debate, especially by the contributions made by the hon. Member for Barry and the hon. and learned Member for Denbigh (Mr. Morgan), who did not give it a whole-hearted welcome but recognised the need for it.

Secondly, the hon. Member for Cathcart said that the Bill was "inevitably bureaucratic". "Bureaucratic" has become a favourite word for those who oppose progressive measures. I do not understand why it should be bureaucratic for the people of Wales and the people of Britain to own their own industries and, through Parliament, to control them. Why should it be more desirable for industries to be run from Texas, Tokyo or Timbuctoo? The Conservatives have no objection to foreign capital coming into the country. Why cannot the people, through Parliament, control these industries? I would prefer industry to be run in that way rather than have a large bureaucracy to have to pay out unemployment benefit because private enterprise had failed to provide jobs.

The hon. Member for Cathcart said. thirdly, that the Bill would create confusion because of the multiplicity of agencies. But the Bill seeks to bring several agencies together. It replaces and co-ordinates those agencies. That is an argument not against the Bill but for it.

Fourthly, the hon. Gentleman said that we should bear in mind the Government's pledge to restore interventionist policies. In Wales we have to have interventionist policies. It is no use Conservatives—who might have some success in Surbiton— talking about the evils of Socialism. Public enterprise has worked for Wales. The people of Wales recognise that if the coal industry, the electricity industry and other industries in the public sector can be run successfully, there is no reason why the manufacturing sector should not be publicly owned.

I am pleased that the measure has been brought forward this Session. I am also pleased to hear the Secretary of State say that he will consider the location of the agency, and I echo the hon. Member for Swansea, East (Mr. Anderson) in saying that it should be located in the Heads of the Valley. There are certainly some good sites between Neath and Ebbw Vale. I must declare an interest because those towns are near to my constituency. The Hirwaun Industrial Estate would be an excellent location for the agency. From the industrial point of view many jobs would be involved. There is a tendency for us to think of Cardiff or even Swansea as a suitable location, but why can not we go to the top end of the valley'? If we located it in such a place, it would show the vision of what we expect from the agency.

I know that many hon. Members wish to speak in the debate. 1 wholeheartedly applaud the Welsh Office on putting the Bill through this Session. We have kept our promise to the people. I look forward in the next few months to see this measure pass through all its stages in the House and be implemented. I want to see the regeneration of industry in Wales by this agency working with the National Enterprise Board. At the same time I want to see the beautification of our valleys that have known the scars of the Industrial Revolution. I want to provide a better environment with more jobs so that people can add to the wealth of our country.

7.51 p.m.

In welcoming the Bill I have to declare an interest because I have spent seven or eight years travelling around Wales calling for an agency of this sort. I am pleased to see it finally come into being.

I see that the Minister on the Front Bench is raising his eyebrows. I should like to draw his attention to a Question that I asked on 1st April 1974. As it was 1st April that may explain the answer that I received. I asked for a national development authority of this sort to be set up, and the answer I received was:
"No, I am responsible for the co-ordination of economic and other forms of develpment in the Principality and I see no need to establish a separate National Development Authority."—[Official Report, 1st April 1974, Vol. 871. c. 248.]
The Minister spoke earlier of the blinding light on the road to Damascus. I am delighted to see that the blinding light has struck home in this instance. There has been a call in Wales for this sort of agency for many years. It is not for one side or the other to take credit for it. To that extent we should all welcome it and make it work effectively.

It is disgraceful that the Bill has to some extent over the past two months become a political football. That should never have happened. There is such a crying need in Wales for the co-ordination and reorganisation of bodies concerned with the development of the economy and industry, that everyone must unite to make the Bill work. I hope that that is what will happen.

Interest has been shown in this type of body on previous occasions, because other countries have developed them. Other countries in Western Europe have made a success of development authorities. There have been instances of such authorities in Ireland, Italy and Belgium. I draw the attention of hon. Members to the minutes of evidence taken before the Trade and Industry Sub-Committee of the Expenditure Committee in 1971–72. In Appendix 22 there is an analysis of the type of para-governmental agencies that exist in other areas. The analysis refers to State holding companies and industrial development banks. I cannot help feeling that the agency we are considering is a hybrid of the two, and that it will be interesting to see some of the powers built into it work in practice. I hope and believe that they will work successfully.

I shall certainly be voting in favour of the Bill tonight. However, there are a few questions that remain unanswered. One of the main questions that have been mentioned on several occasions during the Committee stage of the Industry Bill is the relationship between the Welsh Development Agency and the National Enterprise Board. There is a certain amount of doubt about the exact linking that there will be between the two bodies.

The hon. Member for Aberdare (Mr. Evans) and other hon. Members stressed the importance of the co-ordination work that the agency will do. It is important that there are clear lines of demarcation between what the WDA does and what the NEB does. I have no doubt that there is room for the work of the NEB to be of assistance to the WDA and that they can work together. However, it is important for the people employed in this and other bodies in Wales, at different levels, to know exactly how the two organisations are interlinked. Attempts have been made on several occasions to find out exactly what is the relationship between the two bodies.

I draw attention to a quotation referred to by the hon. Member for Aberdare from "The Regeneration of British Industry", Command 5710, where it says:
"It has therefore been decided that appropriate functions of the NEB should be carried out in Scotland by the Scottish Development Agency."
I am concerned about "appropriate functions". In Committee there will be need for greater clarification of these functions.

Reference to this was made by the previous Under-Secretary of State for Industry in February. In the same debate I raised a few questions which I think are worth underlining concerning the relationship between the two bodies. I should like to raise those questions again now, because if they cannot be explained tonight perhaps they can be referred to in Committee. I asked what, if the NEB and the WDA worked in parallel, will be the mechanism to link the two, what proportion of the total joint activities of the NEB and the development agency in Wales will be undertaken by the development agency. With particular reference to the budget, I asked whether £100 million to £150 million over a certain period of time, which at the moment is not defined, fitted into the expenditure pattern of the NEB and whether the £1,000 million referred to in Clause 6 of the Bill dealing with the NEB affected this at all or whether any of the money would come to Wales in addition to £150 million? I also asked whether the NEB would have total responsibility for branch factories and subsidiaries located in Wales, and, if that was the case, whether the WDA would have any responsibility at all for those bodies. Those are important questions, because so much of the Welsh economy concerns companies that straddle the border.

To a large extent we are a "branch factory" economy. We have a branch factory syndrome. Of the companies that employ more than 100 employees in Wales, only 113 out of 477 have headquarters in Wales. This is an important question that needs clarification. We shall have to wait to see what the final Industry Bill looks like, but there are many areas in the original Bill where there will be questions about whether the powers of the NEB will be appropriate to the WDA and whether the development agency has total authority for those companies that exist in Wales but do not exist outside Wales.

Another question that arises in this context is the relationship between the WDA and the assembly that we are expecting will be set up in the near future. I am glad that the hon. Member for Aberdare referred to the Labour Party's manifesto in the last General Election and said that it had the wholehearted approval of the people of Wales. He will no doubt be aware that the October 1974 manifesto for Wales stated that
"A Welsh Development Agency will be established under new legislation, with a budget from the United Kingdom Treasury, as an executive body, responsible in the first instance to the Secretary of State, and then it will be the concern of the Assembly once it is established."
I have no doubt, in view of their enthusiasm about sticking to the manifesto, that hon. Members will ensure that the WDA will be responsible to the assembly. This is a matter that cannot be settled finally until the legislation for the assembly has come through. I hope that there will not be any delays, so that we can see the democratic control of this body in Wales in the near future. One of the justifications that Labour Members have given for the establishment of an executive assembly in Wales is to oversee bodies where there is no democratic control. I hope that the WDA will be such a body and that hon. Members will demand control of it by the assembly.

I turn to the objectives at which we should be aiming in setting up this mechanism. They are fairly clear to all. We should aim to reduce unemployment, which is too high in Wales. Increasing activity rates have been referred to. Our activity rate, particularly in the female sector, is unnecessarily low. We need to eliminate enforced migration. If people want to leave Wales, the best of luck to them. But people should have the opportunity to stay and have a future in their own areas. We should ensure that jobs are available of as wide a choice as possible, within reasonable travelling distance for people in all parts of Wales, and, through the work of the agency, we should aim at raising the gross domestic product per capita in Wales to a level that is at least equal to the average for the EEC.

What should be the means of arriving at those objectives? First, if the agency is to succeed in its rôle—I believe that it will—it will need to have an influence on the development of the infrastructure. The infrastructure in Wales requires urgent attention. I underline the need to develop our roads, particularly in my part of Wales. The lack of adequate roads in Wales has been a serious problem for some time. I draw attention to the report by the Welsh Council four years ago regarding an economic strategy for North-West Wales. Referring to the need to develop the A55 and the A5, it states:
"If additional allocations of resources for the completion of these roads within the foreseeable future is not forthcoming, it is suggested that the Welsh Office together with the County Councils consider in what ways additional resources can be applied for the improvement of these roads."
In the context of a cut-back in public expenditure, I underline the need to develop our roads if the success of this body is to be ensured. The same applies to developing the infrastructure in other directions. I refer to sites for industry, facilities, utilities, and so on, having adequate technical and business education, the right training for people to work in industry, and the development of the labour for people to work in industry, and the development of the labour force with the right skills. All these are essential. Even if they are not the responsibility of the agency, they are responsibilities about which the agency will need to co-ordinate with the other bodies to ensure that they are undertaken.

We need the right structure of incentives. At this stage I ask the Secretary of State, in considering the money that has been given for the development of industry in Wales, to give a categoric assurance that the money will in no way be clawed back from the EEC contribution. The EEC contribution to regional development in Wales should be an addition to anything that the Government are committed to giving. There should not be a reduction in the money coming from the regional fund of the EEC on account of the Government's commitment. That is worrying people in the Commission in Brussels when I was discussing this matter there yesterday. The Government must give a categoric undertaking about that matter.

It is important that the agency should have powers of initiative. This should appeal to Members of the Conservative Party. Apparently it does not, but I believe that it should. There should be initiative at home in setting up new industry and helping existing industry. We need to set up new industry. If the private sector can do it, very well. But the story in so many parts of Wales has been that the private sector has failed. If the private sector fails to set up private industry in the right place, we need the initiative in the public sector to ensure that people do not suffer.

We need initiative not only at home but in an international context to seek additional markets for the products of Welsh industry. I believe that can be done through co-ordination with the Development Corporation for Wales. The agency should be able to bring companies into Wales from the United Kingdom, from Europe or from across the sea.

Another important point concerns the co-ordination of the functions to avoid duplication of effort. It is important that the agency should carry this out if it is to be successful. There is a danger of duplication.

In this context I underline the need for an economic plan for Wales. The tragedy in the 1960s was the failure to develop such a plan. Following the George Brown plan, there was an attempt to create regional planning and an economic plan for Wales should have developed effectively from it.

The hon. Member for Motherwell and Wishaw (Dr. Bray) referred to this aspect yesterday in the debate on the Scottish Development Agency. I hope that there will be an economic plan for Wales in association with the agency.

I am appalled at the attitude that Conservative Members have taken towards the Bill. I say that having heard some of the comments that have been made by back benchers in the last few speeches. If, as has been said, they are to vote against the Bill, even as it stands, they are totally contradicting themselves. They said that they were worried about matters which were not in the Bill. If they wish to oppose those matters, the time to do so is in Committee when the Government try to put them back in. I shall support the Government in bringing those powers back. But that is a matter for Committee, Report, Third Reading, or whatever stage it may be. It is no case for voting against Second Reading. If Conservative Members do, they will show the total hypocrisy of their party. They will demonstrate that it is not the watered-down version that they are voting against but any form of development agency for Wales. I hope that when they consider going into the Lobby and forcing a Division they will have that point in mind.

There are many interesting differences between the Welsh and the Scottish Bills. These will have to come out in Committee. Grants included in the Welsh Bill are not possible in the Scottish Bill. CORSTR A. which is included in the Scottish Bill, is not in the Welsh Bill. Questions relating to air services, the reclamation of land from the sea, and other matters will have to be discussed in Committee.

One point that worries me—I refer to Baroness White's speech in another place—is the possible clash between the interests of the environment and industrial development. I certainly appreciate the link that the Government have proposed, but I have some sympathy for the school of thought that this could be counterproductive. Tension may be created which puts decisions at a level where they should not be taken. If there is a question of priority between industrial development, on the one hand, and the environment, on the other, and it is a question of spending £5 million on the one or the other, that will be a decision which will have to be taken at a political level. I do not believe that such a decision should be put into the mechanics of the agency. That is the one doubt I have about bringing these two matters together in the agency. Both are important. I should not like to say that one has priority over the other, because both are necessary.

The European dimension is important. The offices of the development corporation should be expanded to the maximum extent possible. The corporation has full-time representation in Germany. It is important that that representation should be extended to other countries. There is a role for the agency here in co-operation with the development corporation to ensure that that happens.

I should like to see a means for enabling the agency to raise loans directly from overseas if there is difficulty in raising money at home. I hope that it will be able to raise money in excess of the £100 million or £150 million at present laid down. Perhaps that matter could be explored in Committee.

Reference has been made to the rural development board. There is a need for special provision for rural Wales. I hope that the Secretary of State will address his mind to setting up machinery which will ensure that rural Wales gets the same benefits as the areas of the Highlands and Islands Development Board in Scotland. They are allowed a higher level of grant from the Regional Development Fund in Europe than anywhere else in the United Kingdom. We need the right mechanism to be set up in Wales so that similar benefits can be given to rural Wales. That is another matter which ought to be looked into.

There is the question of the definition of the agency's areas of activity. It is interesting to see the definition of industry in Clause 24. It is a rare definition, but welcome. I take it that the powers of the board will go as far as extractive industries. There is a need for intervention in extractive industries and also in certain tourist areas. The tourist industry can play an important part in developing the economy of many parts of Wales. I hope that the agency will have a rôle to play there. In this context we are talking about industry in the broadest sense and not just manufacturing industry.

Further liasion with nationalised industries is also important. The Bill does not make very much reference to that. If the Government are successful in introducing their amendments to set up publicly-owned companies, the relationship of those companies to the agency and the parallel relationship with the nationalised industries that already exist will be of the utmost importance.

Risk capital must also be considered. In a Welsh Council study five years ago it was recognised that there was a need for additional risk capital for small companies. I hope that there will be a rôle for the agency in providing more risk capital for Welsh industry.

Next, I turn to finance. I asked the Secretary of State earlier what period the £150 million was to cover. If it is to cover a certain amount of work and if it will be possible to return after 18 months or two years and to receive a favourable response to a request for more money, that is fine. I draw the attention of the Secretary of State to the fact that the Welsh TUC called for a fund of £500 million over five years. I take it from what the Secretary of State has said today that that is quite possible within the context of the Bill. I hope that will be the case.

It is important for managements to know exactly where they stand so that they can develop plans over a long period and do not have to live from hand to mouth from one year to the next. It is also important that there are more extensive borrowing powers in addition to the £150 mililon.

Finally, I emphasise a point that has been made by many hon. Members. If the agency is to work it will work because we have the right calibre of person running it. It is essential to get the right man for that job. I hope that the Government will leave no stone unturned in order to get the right man. I would like to see a Welshman occupy that position, but more important, a man from any part of the world who will make the agency work properly. I hope that we are successful in obtaining the right man.

I remember a few years ago in a time of gloom as regards economic policy in Wales that Professor Nevin said there was no movement "because the boat had no engine". The Bill can provide the boat of economic development in Wales with an engine, and I wish it luck.

8.12 p.m.

It is a pleasure to follow the hon. Member for Caernarvon (Mr. Wigley), and particularly after the zest he has shown for the proposals contained in the Labour Party election manifesto.

I welcome the Bill for the two-pronged attack that it is intended to make in promoting industrial development in Wales and in bettering the environment. Both of those objectives are vitally necessary. As regards the first objective, it has been apparent for over 10 years that the British capitalist system is breaking down. This has been manifest by a lack of investment. Of course, investment is the seed corn in industry which keeps our competitive edge in the world export markets. It provides more power to the elbow of workpeople in industry. What is more, it ensures that they stay in employment, which again is vital. Alongside the lack of investment we have also had a build-up of property speculation. Those two factors are the principal reasons for the present parlous nature of the British economy. Of course, we have very much felt the ramifications in Wales.

It is in that sense that the Bill is essential, as is the Industry Bill. However welcome both Bills may be, if anything they are too late. For Conservative Members to say at this stage of our affairs that such proposals are not necessary is sacrilege to say the least. Likewise, when the Government invest public money in private industry there must be public accountability alongside that development.

I do not understand why the Opposition can oppose such sensible proposals. Indeed, the Conservative Party in Wales now seems to be so way out that it is even falling out with the Western Mail. That is an interesting development. I must ask Conservative Members where the Welsh entrepreneurs are to be found. If we had to rely on them we would become a nation of unemployed.

I briefly refer to a rather forgotten sector of the Welsh economy—namely the ports, and in particular my own area of Newport. Over the past few years the British Steel Corporation seems to have been trying to bankrupt the Newport docks. It has taken the entire iron ore trade from Newport. Millions and millions of tons of iron ore are being transported overland from Port Talbot. That is not an efficient system and it is particularly unreliable. The corporation has turned what was a consistent profit-making port into loss-maker. There is a vital need to invest in a new terminal at Newport to supply the great works at Llanwern. Those works have been turned into a virtual subsidiary of Port Talbot. One of the most disastrous mistakes that the corporation made was when it pigeonholed the proposals for the new port at Newport. That marks the turning point in the sad story of Llanwern and all the troubles that have gone on there ever since.

The only answer remains the provision of a new port for Newport to supply the great Llanwern works. It should be given the go-ahead, especially during this time of economic recession. It could mop up a lot of the unemployment in Gwent, and particularly in the valleys. If such a project were put into effect it would be ready and available when the upturn in the economy came about.

A fortnight ago we had the report of the National Ports Council. Mr. Philip Chappell, chairman of the council, said:
"Capital expenditure by port authorities is still declining from the peak achieved 10 years ago … But more investment could mean over-capacity."
Of course, Mr. Chappell is perfectly right. That is why my right hon. and learned Friends opposed the West Dock development in Bristol. We said that the South Wales ports were already under-utilised. How right we were. Of course, the go-ahead was given for that development and the cost is escalating. The ratepayers of Bristol are saddled with this great burden and they have the biggest white elephant in history.

Mr. Chappell also said:
"The one exception could be by the development of an 'industrial port' alongside the more conventional commercial port. It was for this aspect of renewed industrial activity, for both large and small developments, that more coherent support—and perhaps financial aid in selected places—could be based."
The scheme which I have mentioned in respect of the Spencer works would fit in ideally with the proposals made by Mr. Chappell, Chairman of the National Ports Council. Furthermore, such a scheme would be an automatic money-spinner because the trade is there already and should be proceeded with. I hope that the Secretary of State is taking note of what I have said. I appreciate his constituency interest, but I am sure that we can rely on him to be impartial.

While the Secretary of State is present, I should like to make a few comments about Clause 2 of the Bill dealing with appointments. Please let us not have any more Tory "dead-beats" in these jobs. The Secretary of State in introducing the Bill said that we require men of outstanding ability. I could not agree with him more. There is a sad record of disastrous appointments. We have only to look at what happened in the steel industry. We appointed Mr. Cartwright, a man who over the years persistently opposed steel nationalisation. He was made vice-chairman of the publicly-owned industry, and we know the consequences for that industry and its disastrous record.

In the water supply industry there was the appointment of a Tory old-age pensioner. I agree that some of these appointments were made by a Conservative Government. I am Chairman of the Parliamentary Sports Committee and I must say that the Secretary of State in his recent appointments to the Welsh Sports Council has not shown the imagination which we are entitled to expect from him. We must realise that the Conservative Party in Wales is only a small and anglicised faction. Wales has always rejected the Conservative Party. Let us hope that in his new appointments my right hon. and learned Friend will use some imagination.

Clause 13 deals with environmental development. It could be said that over the years South Wales has paid dearly for its failure in terms of lack of attention to environment. I do not doubt that because of this fact we have lost many new industries and enterprises which otherwise would have come to the Principality. When people from more salubrious parts of the British Isles visit South Wales they cannot understand how we in our valleys are prepared to live next door to coal tips. They see our once-beautiful rivers as black as the ace of spades. This is one of the principal reasons why many industries have not been attracted to Wales in the past. Then we had the terrible shock of Aberfan to shake us out of our apathy.

I congratulate the present Government, and indeed their Conservative predecessors, on the progress they have made in improving the Welsh environment. Our rivers have improved. I hope that the Secretary of State with the aid of his new powers in the Bill will put pressure on the local authorities to go all out to improve our environment in Wales, because this can do so much for the economy as a whole.

I have spoken about action taken to deal with pollution in Welsh rivers over the years. The pollution of those rivers is only minimal compared with what is happening in the Bristol Channel, which is choked with pollution. We have heard that 96,000 tons of poisonous industrial waste is to be dumped in that channel this year by the Welsh National Development Authority. On top of that, no less than 210,000 tons of crude sewage goes into the Severn Estuary every day. I have been in correspondence with my right hon. Friend the Minister of Agriculture, Fisheries and Food and also with Welsh water authorities over this development. A total of 60,000 tons of sewage sludge comes from the treatment works at Gwent and is taken out by ship from Newport docks. That sludge may contain traces of a lethal substance known as cadmium. One of the vital aspects is the fact that under Section 68 of the Public Health Act 1961 the water authority is prevented from divulging the source of the cadmium which is being discharged into the sewers. It is a remarkable state of affairs when people are being systematically poisoned and yet are not allowed to know where the poison conies from. The Secretary of State for Wales is the voice of Wales in the Cabinet. He should look into the matter and say what can be done as a matter of urgency.

I welcome the Bill because there is nothing but good in it. I wish it a speedy passage to the statute book. References have been made to Richard Llewelyn's "How Green was my Valley". I read the Second Reading debate in the other place. Their Lordships waxed eloquent about George Borrow's "Wild Wales" and also about Alexander Cordell's "Rape of the Fair Country". We have seen in Wales a great deal of disfigurement of the countryside. I hope that the Bill will bring a small measure of recompense for those who have suffered so much over the generations.

The wind-up speeches are due to begin at 9 o'clock. I hope to accommodate four more hon. Members who are anxious to take part in the debate. This can be done if hon. Members co-operate.

8.28 p.m.

We have heard from the hon. Member for Newport (Mr. Hughes) a remarkable speech which contained a bitter attack on the Conservative Party. I can only assume that the hon. Gentleman is still feeling a little sore after the overwhelming rejection by the people of Wales of his advice for us to quit the EEC.

At first sight the Bill appears rather harmless, and possibly even beneficient. We have been taken to task for daring to oppose it. We do not oppose the environmental and co-ordinating functions in the Bill—quite the reverse. I do not think that the Government should be surprised at our opposition to the Bill in its present form or to the original version, nor should they be surprised at our opposition to the Secretary of State's proposals to amend it by restoring the agency powers which were included originally. The Bill was considerably improved in another place and I only wish that we could promise to do the same.

The Bill will create a major Government agency and arm the Secretary of State with enormously increased powers so that neither the House nor anyone else will have control over what is happening. The agency, either under the direction of the Secretary of State or acting on its own account, will have the capacity to alter entirely the economic aspect of Wales. It will not be operating on normal commercial lines and it will be established with public money. On these grounds, its accountability to this House should be made clear. Is it intended that we should have the right to debate the annual report when it is presented to Parliament by the Secretary of State? I believe we should have that right every year.

What is becoming ever clearer is the need for a Welsh Select Committee to investigate and cross-examine the Secretary of State, his Ministers and the civil servants on the operation of their powers and responsibilities. Every hon. Member knows that as the Secretary of State's powers have grown, Welsh Question Time has become a farce. We cannot effectively examine on the Floor of the House what he is doing, his functions and his responsibilities. We are limited to one Question each on one topic of the very many for which he is responsible, and yet his powers are increased by the Bill. That will make matters even more difficult for hon. Members. The Secretary of State's powers will be widened still further and will be unchecked by Parliament.

What will be the position of the agency if the Government fulfil their pledge of an elected Welsh Assembly? If the Secretary of State is to retain powers in this field and not devolve them, I am sure that certain hon. Members, including some on the Labour benches, would be very interested to know that. If the Assembly is to replace the Secretary of State in the exercise of these powers, other questions arise. Will the agency be eligible to receive finance from the EEC, for example through the regional fund?

The nub of our opposition to the Bill, particularly in the form in which the Government wish to see it, is that it represents a considerable increase in State power and ownership. It is also extremely confused in certain respects. We know that the agency will have certain powers and features in common with the proposed National Enterprise Board. The Minister of State, Scottish Office attempted to show where the lines would be drawn between the agency and the NEB when the Scottish Development Agency (No. 2) Bill was in another place. The Secretary of State tried briefly this afternoon to give his own explanation, but Ministers' efforts merely serve to illustrate how confusing and confused the situation is.

The Minister of State said:
"Perhaps the greatest difficulty to be resolved"
that means it has not yet been resolved—
"is how to express the dividing line between cases in Scotland which are to be financed by the NEB and those which are to be financed by the Agency. We shall be working out these details."
Apparently they have not been worked out yet.
"We propose to consult the CBI and the STUC. Broadly"—
a nice generalization—
"we intend to adopt general principles whose applications will be determined, fairly pragmatically, on a case-by-case basis. The point is that there will be no rigid demarcation between some companies or undertakings in Scotland which are the concern of the Agency and others which are reserved to the NEB."—[Official Report, House of Lords, 24th June 1975; Vol. 361, c. 1298.]
The truth is that the Government do not know where they are drawing the line. How do they think that industry can order its affairs if they cannot give a clear indication of their intentions? I would like the Minister to refer to paragraph 21 of Schedule 1 to the Bill whereby the agency is to be exempted from Section 14(1) of the Prevention of Fraud (Investments) Act 1958 and Section 13(1) of the Prevention of Fraud (Investments) Act (Northern Ireland) 1940. This point was raised yesterday in connection with the Scottish agency by my hon. Friend the Member for Edinburgh, West (Lord James Douglas-Hamilton). I trust that the Welsh Ministers have had sufficient notice to be able to tell us why the agency should be immune from the conditions applying to private undertakings under those Acts.

At the root of our objections is the tact that the agency is, like any Government agency or nationalised industry, free from constraints which apply or ought to apply to private industry. While the agency was originally charged with promoting industrial efficiency and international competitiveness, it was also charged, and still is, with safeguarding employment in any part of Wales. How fortunate it was that their Lordships altered the original wording of Clause 1 so that what originally were duties are now only discretionary functions for the agency.

Even so, the agency will find itself in a hopeless tangle. We all know that if industries or individual firms wish to compete internationally the work force will have to be cut in the interests of increased productivity. How on earth will the agency choose between efficiency and safeguarding employment in view of the Government's pusillanimous attitude towards redundancies?

May I give the hon. Member an example of the way in which I envisage the agency being able to intervene effectively? Two years ago, during the period of the Conservative administration, a firm withdrew from a branch factory in my constituency. It has been holding the tenancy of the factory for two years. Now it has collapsed into liquidation. In such a situation, surely the agency would be able actively to intervene to retain employment and a viable production unit.

If that company has gone into liquidation because it was losing money, I cannot see why the public should have poured money into it. Private industry finds itself in a hopeless situation. We have record post-war unemployment figures which are increasing monthly. Our currency is sagging to a record low level. Inflation is running at two or three times the rate of that of our international competitors. The capital market is being sucked dry by the Government's enormous and growing borrowing requirement. The Government have enormously increased personal and corporate taxation. They have invented new taxes, like the capital transfer tax, and intend to invent further new taxes, like the wealth tax. We need not just incentives. There needs to be an ability on the part of private industry and individuals to invest on their own account.

The Government have introduced measures such as the Community Land Bill, the Trade Union and Labour Relations Act, the Employment Protection Bill and the Industry Bill, which immeasurably increase the power of the State and of trade unions. Today, of course, the Secretary of State has gone ahead and threatened us with a new form of rural development board for Mid-Wales. The Government do all this at a time when there is a world trade recession.

Labour Members have complained that private industry—which provides well over 90 per cent. of the life-blood of the country in the form of exports and the bulk of our taxes, which are the lifeblood of the Government—is failing the nation. Indeed, as the Government's measures progressively bite into the vitals of British industry, the excuse to use the powers of bodies such as the Welsh Development Agency to carry on—this is what they want to put back into the Bill—industrial undertakings and establish and carry on new industrial undertakings, particularly where their form of industrial democracy, yet to be defined, is practised, will become quite overpowering.

The Bill is just another excuse for further nationalisation and State control. The parts which refer to the environment or to promotional co-ordination could perfectly well have been achieved by other means. Some will claim in relation to State power that the Bill is only a little one. That was the claim of the maidservant with the illegitimate child. The results are the same—an eventual and irresistible growth.

This is a Socialist measure, just as the ill-conceived Welsh Rural Development Board was a Socialist measure. We cannot expect any less from a Socialist Government, and with that I cannot take issue. However, I take issue with Socialism itself. The Bill and the Minister's statement today make it plain that we have a prime example of a Socialist Bill purporting to be a measure of moderation. Certainly it may be moderate in the eyes of the Tribune Group but, my goodness, would not its predecessors of just a few years ago have been delighted to achieve what the Bill threatens?

Unless the Bill and the other measures I have mentioned are not overturned or utterly reformed by the next Conservative Government, Britain will no longer enjoy a mixed economy.

Indeed some claim that the balance has already badly tilted away from the private sector. We shall have instead—and unless we can overturn it soon we shall have instead—a Socialist State, State-owned and State-run, and a system, therefore, in which freedom itself is bound to perish.

8.43 p.m.

I shall try to keep my remarks within the time allocated. Some people, especially Conservative Members, have criticised the principle of the public having certain rights when they have invested public money in concerns. Conservative Members are very willing for public money to be invested in ailing or failing concerns, but they are not willing for us to invest in profitable concerns. This seems a very odd way for these guardians of the public purse as they like to portray themselves, to carry on. When we have invested, they are unwilling for us to expect some return on our money or to expect some say in the way in which the industries concerned are run. This lies behind a great deal of what has taken place in the debate and in other debates on related matters.

The argument of Conservative Members, as the hon. Member for Cardiff, North (Mr Grist) has just illustrated, is that market forces must be the be-all and end-all of things, and that protection of employment comes second to that. He made it pretty clear in his remarks that if a firm, such as the example given by the hon. Member for Merioneth (Mr. Thomas), is going under it should be allowed to fail. That seems to be his theory.

We believe in an entirely different philosophy, namely, that if a firm is marginally in trouble we need an agency, such as the Welsh Development Agency, to rescue it. We believe that we should have such a means. Surely it is better to spend a smaller sum on enabling people to retain their jobs than to pay out £1 million in unemployment pay?

We are accustomed to the arguments used by the Conservative Party for allowing simply those industries in which it is difficult to ensure profitability, such as coal, to remain in public ownership. However, if an industry threatens to be very successful, the Opposition do not want it in public ownership because they might have too many of their supporters clamouring for more public ownership. They want these examples to show that public ownership does not work. For this reason they will be unwilling to support that element in the Bill which indicates that we want to invest in profitable industries as well and to have a stake in them.

The Secretary of State must retain some controlling powers over this agency. If it has a free rein we in this House shall not be able to question its activities. I have been concerned over the years about the agencies that have been set up in Wales. I believe that Wales, compared with any other part of the country, has more agencies which are semi-independent and which we cannot get at. Throughout the United Kingdom we have the Post Office. I deplore the fact that we cannot question Ministers sufficiently closely on the activities of the Post Office. I do not like the idea that we cannot ask sufficient questions about the activities of the water authority in Wales. We ought to have more power over these bodies. It is public money that they are spending on our behalf.

This is where the Welsh Development Agency is important. However, we must have a say in its activities through the Secretary of State at this stage. We might develop that in other forms later. Hon. Members may object to this, but in doing so they are crying for complete independence for this body. I am unwilling to allow it such independence, because the appointees should not be free to spend public money in whatever way they wish.

The hon. Member for Pembroke (Mr. Edwards) did an injustice when he criticised the reference to industrial democracy. He did the Bill less than justice. In Clause 1(3)(d) we refer to the promotion of industrial democracy in undertakings with which the agency is associated. This is important, because our experience over the past few years has been that the creation of public bodies and corporations has not led to sufficient say for employees in the industries concerned. I do not expect it to be spelt out in the Bill exactly what form of industrial democracy is intended.

At the lowest level, it is simply that workers in the industry concerned have some say in the affairs of the industry and are not dictated to. This can be expanded upon and we can discuss what form it may take. But certainly I do not see why we should again have the pattern of set-up that we have had in the past, which has been unsatisfactory. People working in the industries concerned ought to have much more say.

Finally, I was glad to hear my right hon. and learned Friend the Secretary of State refer to Mid-Wales and rural Wales. I understand his point of view that we cannot at this stage have another body alongside this one. However, when this Bill has become an Act, I look forward to the creation of some such body to look after the interests of Mid-Wales. It could come under the umbrella of this agency or could be a separate body. I shall not argue about that.

I notice that the most vociferous critics of the Welsh rural development board, Liberal Members, are nowadays finding support for the creation of some such body. The National Farmers' Union of Wales was among the most vociferous opponents of the WRDB, but now it is asking for something similar. We have certainly lost out by not having such a body. I remember when the Tory Government abolished the Pennines Rural Development Board in 1971. That was a good example of what we need in Mid-Wales. I hope that we shall have a comprehensive set-up to look after our interests.

Like all hon. Members who have spoken in the debate, I welcome those parts of the Bill which provide for co-ordination of existing activities—that is very useful—and those parts of it dealing with the environment. I want to ask the Under-Secretary to make it quite clear that tourism will get a look in on the sponsorship that is coming in under the Bill, because it is one field in particular in which State enterprise can play a really useful rôle in developing and even initiating projects which can have spin-off greatly to the benefit of private enterprise working in the same field.

I wish briefly to explain why I am going to vote against the Bill tonight. I do so as one who voted with a happy heart for the 1972 Industry Act. I am not at all opposed to the principle of State intervention in industry. I regard the State as having a continuing rôle to fill what might be called social gaps in the achievement of private industry. But in 1972 the situation was a very different one. The problems that faced us in those days were problems of pollution, of running out of raw materials, of labour shortages and of economic imbalance, not at all the problems with which we are faced today. The problems which we face today are the mirror image of the problems that we faced in 1972.

If I vote against the Bill tonight it will be not primarily on account of what is in it. It is a little hard to know exactly what is in it in terms of intervention, if only because we do not know how the Industry Bill will survive the raking cross-fire that it is getting from both wings of the Labour Party. I shall vote against the Bill not primarily because of what is in it but because it comes at the wrong time, at a time when the mixed economy, as my hon. Friend the Member for Cardiff, North (Mr. Grist) said, is in real peril.

I wonder whether those hon. Members who pay lip-service to the idea of the mixed economy realise quite what a danger there is of a massive collapse of the whole of the private sector, and I have a horrible fear that the Bill will accelerate that process of collapse, and do so for two reasons: first, because of the additional tax burden which is to be laid on an already groaning private industry. The money that will be spent under the Bill—and we are a little unclear exactly how, and how fast, they are to be spent—has to be raised and much of it will have to come out of private industry. In so doing the Government will be further limiting the ability of private industry to pay its way.

There is a point that has not been raised by any other speaker in this debate, that bodies such as the Welsh Development Agency and the National Enterprise Board provide a kind of surrogate for effective action. They "kid" people into believing that by creating the right kind of organisation, by setting up the right kind of body, we can somehow avoid having to make very painful choices, that somehow we can make bricks without straw. Hon. Members opposite know as well as anybody else that the only way we are going to get out of our mess, the only way that we shall conquer inflation and start to reduce the terrifyingly rising tide of unemployment, is by persuading people somehow or other to go without goodies today in order to buy the tools to work with tomorrow. It is as simple as that.

I have a horrible feeling that the Welsh Development Agency is going to obscure that basic truth and that for every two jobs that this agency creates by its interventionist activities, it will take away three elsewhere.

The one and only certainty about the Bill is that it will win more votes than jobs. It will do so at a time when unemployment is running as rapidly out of control as inflation. As an index of the way in which inflation is running out of control, it is instructive to compare the price of the Bill now with what it cost when it went into the House of Lords on 29th April. It then cost 29p, and when it emerged rather less than two months later it cost 42p. That is a rate of inflation of 45 per cent. in just under two months. On what is now known as the Healey basis of calculation, that is a rate of 270 per cent. per annum, which helps to explain the mess we are in.

I am seriously concerned about the way in which unemployment is rising in my constituency. It is bad enough for middle-aged people who find themselves out of a job, people who are tempted into premature retirement by the offer of severance pay and so on, and who before very long bitterly regret it. I am still more worried by the prospects for school leavers. The figures for the Rhyl travel-to-work area show that 53 boys and 29 girls are unemployed, compared with nine boys and 11 girls at this time last year. This picture is repeated all over the country. I have a horrible feeling that the young people concerned will grow up into an unfriendly, unwelcoming world in which they feel unwanted.

Here, more than anywhere else, is the problem we shall face in two years' time—not just an economic problem, not just an unemployment problem, but a social problem of appalling magnitude which will be a time bomb exploding not under the present Government but under their unfortunate successors.

8.57 p.m.

If the last two Opposition speeches had come from Conservative Members from South-East England and the other fatter regions of the countries of the United Kingdom, they would not have caused a ripple on our consciousness because we have been so used to hearing that kind of thing from them. We can understand that in their salubrious and affluent areas, insulated from some of the harsher realities of industrial life, they can arrive at the kind of conclusions they have reached. But when we hear Welsh Tory Members proposing that the cure for inflation in Wales, and even in their own constituencies, is more unemployment it is an extraordinary revelation of their attitude to the conduct of affairs in Wales compared with ours.

I am sorry that I have not been here for a large part of the debate——

I took the trouble to try to explain to the hon. Gentleman's Whip before the debate that I was serving on a Committee upstairs, where my hon. Friend the Member for Wrexham (Mr. Ellis) is still serving and therefore was obliged to be absent from part of these proceedings. I am sure that everybody will understand.

We are now faced with the Welsh Development Agency. When I looked at the Bill when it was produced, and as I followed the debates in the House of Lords, I was not convinced that it was the answer to a Socialist's prayer, but I was prepared to give it my wholehearted support in the knowledge that the powers proposed for the agency, and its purpose, had a realistic place in meeting the problems of Wales. After hearing the hon. Member for Cardiff, North (Mr. Grist), I am much fortified in my opinion that it is after all a Socialist weapon, because the hon. Gentleman sees it as part of the slimy hand of Socialism reaching over our free country, destroying everything that is best. Everything that appears to the hon. Gentleman to be best appears to me to be worst. The very kind of development that he appears to fear most, I wish for most. Therefore, I shall go into the Lobby with a ready conscience and a more joyous heart than I might otherwise have had.

The Welsh Development Agency, its running mate the Scottish Development Agency and the National Enterprise Board are realistic because they are designed to meet the main difficulties which beset our economy and our people now. With the prospect of growing unemployment, there is a need for a new industrial basis, a new impetus, and—dare I say it?—a new form of enterprise, the traditional system of enterprise having completely failed to deliver the goods or satisfy the needs of workers and citizens in a modern democracy.

We need a renewal and reinvigoration of our economic system, and it is through machinery like the development agencies and the National Enterprise Board, the extension of public ownership and control, and public accountability throughout our economy that we shall achieve the kind of development we need.

The answer to our problems, whether we are talking about our outdated industrial structure, our decrepit social infrastructure or our disastrous investment record, lies in the State sponsorship and public accountability of the means of production, distribution and exchange. It does not lie in the destitution of mass unemployment and the destitution of cutting back public expenditure to the bone—remedies which have been attempted before and resulted in the untold misery of the two decades between the wars, as well as the many years of bitter experience before that—[HON. MEMBERS: "Three weeks."] I shall be saying this in three weeks' time, because I am prepared to be honest with my own Government, unlike the hon. Gentleman opposite with his Government and its newly-developed conscience about unemployment—a novel experience for hon. Members who were here during 1972–73 when the unemployment figure reached 1 million. I shall be quite prepared to speak up for my constituents, for my class, for the interests I represent and for the manifesto on which I was elected, regardless of which Government happen to be in power. I hope I shall not have to prove this in three weeks' time, but if I have to do so I certainly shall.

The answer to our problem lies in production, and not in the destitution which would be visited upon the people as a result of the different types of proposals made by Opposition Members.

In pursuing our purpose, regional policy is vital. Until now, under both Governments, regional policy has been a crutch for capitalism. It has been the last faint gasp of hope of a Welfare State, trying by cajolery and bribery to generate sponsored industrial development in the peripheral areas by injecting a few hundred million pounds. Help has come but not at the speed or on the scale that is needed. Therefore, the responsibility for creating the jobs, renewing the infrastructure, changing and redeveloping the environment and bringing Wales up to a level of expectation and civilisation which people in many other parts of Britain and throughout the world take for granted is moving more and more into the sphere of public provision.

It is an inevitable consequence of the failure of the system supported by Conservative Members. If they had any understanding at all of the system in which we are living, of the age in which we are living and of the economy as it develops, they would see that the best they can hope for is a rationalisation of that process. To stand against it in the stupid single-minded way they do is like trying to push back the tide of history. As part of the process we have this increasing demand for accountability and the new aspirations of the people of our country. Having invested their skills, they also demand the same powers in the conduct of their material lives as they have in the conduct of their political lives.

We are at the dawn of the age when the power of democracy is moving out from its single base of the ballot box periodically on to the shop floor. Opposition Members will throw up their hands in disgust and horror at that, in the same way as people of their convictions did when the vote first came to working men and women. They have the mask of civilisation today. They understand the maturity of the lumpenproletariat and are prepared to concede that they should have the vote. But if they are capable of making a direct contribution to the running of our country, they are more than capable of making an equally direct contribution to the running of our industries which depend on their energies, talents, skills, originality, inventiveness and enterprise even to exist, let alone to be profitable and viable.

In all these spheres, whether we talk about the development that we need of industry in Wales, about the improvement of our environment or about the inspiration of our people, the Welsh Development Agency will play its part. Like many other propositions made by the Government, they are plans; they are proposals.

I am willing to stand in charitable judgment of such proposals and to judge them in the reality of the jobs they bring, the changes they bring and the encouragement they give to our people. Those who are ideologically opposed to the Bill are not simply in for a hiding tonight in the Division Lobbies. They are in for a hiding by history.

9.7 p.m.

Despite all the criticism levelled at the Opposition for insisting on this debate being held on the Floor of the House rather than in the Welsh Grand Committee, I have not noticed that the debate here has impaired hon. Gentlemen's enjoyment of it. We have had a good debate, and I am sure that the Government as well as ourselves will have found it useful.

This may be a historic Bill, but never did a Bill suffer more from bad company than this one. Someone once said that bad company was like a dog: it dins those most whom it loves best. The Bill has been sullied by its association with the Industry Bill, and that association has made its passage through this Parliament more difficult.

Not only are the two Bills associated in our minds. They are physically associated. They have similar features. So, too, has the Scottish Bill. That and the Welsh Bill are as alike as twin brothers, and one has only to trace their lineage in the manifestos of the Labour Party to discover that both are offspring of the Industry Bill concept. Further comments on my part on their parentage would probably be in bad taste, if not out of order.

The Prime Minister has now seen fit to amend the Industry Bill—not half as much as some of us would wish, but a little is better than none. One of the amendments requires that the National Enterprise Board should conform to Section 209 of the 1948 Companies Act. That section deals with the power to acquire the shares of shareholders dissenting from a scheme or contract approved by the majority. I hope that the Minister will be able to tell us whether the same amendment will apply to the Welsh Development Agency.

The similarity between this Bill and the Industry Bill naturally led to a suspicion that the agency in Wales to be established under this Bill would be a sub-office of the NEB. Indeed, the suspicion was there before the Bill was published, because the Government felt obliged to deny it in their consultative paper published in January, which said that the agency would not be simply a Welsh arm of the National Enterprise Board. That may be so. Clearly, the agency has other functions, but the fact remains that at this moment the precise relationship between the agency and the NEB has yet to be defined in guidelines which this House has yet to see. I am sure that we should all, including the hon. Member for Caernarvon (Mr. Wigley), be much happier if we had those guidelines with us now. I think that the Government are culpable to some extent in not having produced them for our discussion today.

According to a statement made by Lord Hughes in the other place, we shall not see these guidelines until the development agency and the board are established. Lord Hughes was talking about the Scottish agency and the NEB. But I think I am right in taking it that what he said about the relationship of the Scottish agency with the NEB is equally true of the relationship between the Welsh agency and the NEB. We understand that the guidelines will deal with those functions of the NEB in Wales which are not devolved to the Welsh Development Agency. These are the functions of extending public ownership into profitable sectors of industry, promoting schemes for the reorganisation or development of industries at a national level, acting as a holding company for State holdings in industry and acting as a channel for selective assistance to companies with branches in Wales which need to be assisted on a United Kingdom basis.

Those are considerable powers. We take strong exception to some of them. Although they do not belong to the agency, we are told that the NEB will consult the agency about their exercise in Wales. In other words, there is likely to be a considerable overlap in the activities of the NEB in Wales and the agency. The agency may not be the arm of the NEB in Wales but those bodies will certainly be hand in glove.

Our suspicions of the agency's relationship with the NEB were well justified. The connection between this Bill and the Industry Bill has been curiously interpreted by the Press in Wales, notably the Western Mail. A number of speakers have referred to that point. That newspaper took a convoluted line—to use one of the Prime Minister's current favourite phrases—when it sought to deal with the typically mild criticism of my hon. Friend the Member for Pembroke (Mr. Edwards) of the Bill as a vast extension of Bennery in Wales.
"But what he is proposing"
said the Western Mail leader,
"is precisely that. To take away powers from a Welsh agency is simply to hand hard-won autonomy straight back to Mr. Benn or his successors and ensure that the agency is just the Welsh arm of the National Enterprise Board."
In other words, the Western Mail did not mind the Secretary of State for Wales extending public ownership as long as it was not done by the Secretary of State for Industry.

I am sorry to tell the right hon. and learned Gentleman that I see no difference between the extension of public ownership under one Secretary of State or the other. There is no difference. They are both Secretaries of the same State. We are still one State, if not one Church, and will remain so until the Members of Plaid Cymru get their way. The Western Mail's curious philosophy was that we do not mind being robbed as long as we are being robbed by friends.

Perhaps this is the right moment to deal with the general impression prevalent in Wales that in the not-too-distant future the agency will be made responsible to a Welsh assembly. The same future apparently awaits the land authority for Wales to be set up under the Community Land Bill. Yet what the Government have said on that point is meagre. The general impression that a transfer of responsibility will take place is based on what the Government have not said rather than on what they have said. Hon. Members who wish for such a transfer should not count their chickens before they are hatched.

Meanwhile, we are giving immense powers to the Secretary of State, powers which he himself described as near-dictatorial, and we are giving those powers to him very much on trust. He is becoming the latter-day Rowland Lee, for we must take into account not only the powers he has under this Bill but the powers he will have under the Community Land Bill. I am not sure which I fear most, the liaison between the agency and the NEB or that between the agency and the Land Authority. Both will have compulsory purchase powers, both are small, compact bodies, democratic only in so far as they are responsible to us through the Secretary of State for Wales. We assure him that we shall watch both organisations and himself very carefully.

The Bill and the agency have suffered, too, from what I can only call bad presentation. I should not like to call it dishonest presentation, but neither would I call it honest. We had all the good news first and somehow the Government never got round to giving us the bad news, or, if they did, it was subliminally presented. News of the agency to be set up under the Bill was delivered with an ample sugar coating of euphoria and we had to bite hard to taste the bitterness within.

In the consultative paper we read of the agency's impeccable objective as being
"to accelerate the economic and industrial development of Wales and to improve the environment in a way consistent with that objective."
We read of the proposed take-over of the Welsh Industrial Estates Corporation by the agency and its supporting rôle in connection with the development corporation. If one did sit up at the description of the agency's third function as being:
"to carry out regional development functions in Wales of the proposed National Enterprise Board"
one was quickly reassured by the firm statement that the agency would not simply be a Welsh arm of the NEB.

Fair play to the CEI in Wales. Although it welcomed the agency in principle—the agency as described in the consultation paper, not as seen in the Bill—it expressed reservations, and those reservations have deepened with time. That part sentence in the consultation paper that states that the agency will:
"establish new and joint ventures"
has gathered more opposition to the Bill than all the rest. In the original Bill it is enshrined in Clause 1(3)(c) as the power:
"to carry on industrial undertakings and to establish and carry on new industrial undertakings"—
in other words, to extend public ownership and compete with existing private undertakings. Let us get this clear. What we object to about this competition is that we cannot see that it will be fair.

Will the hon. Gentleman save himself a lot of breath and us a lot of time by admitting that, whenever the State is giving, the CBI says that that is all right, but whenever the State wants to take some power to go with the money, the CBI complains that it is unfair?

Where does the money come from in the first place? We have had this argument before, when Government supporters were saying that the State supports industry to the tune of £2 million a day. Is it not equally true that industry supports the State to the tune of £10 million a day in taxation?

The NEB has similar powers under the Industry Bill to form bodies corporate and partnerships. We must resist the Bill, because the Secretary of State has made it absolutely clear that Clause 1(3)(c), although removed by the Lords, will be restored at the first opportunity. It seems silly to us that the Government should spoil their ship for a ha'porth of tar, but that is their decision.

We must resist the Bill, because we do not believe that the extension of public ownership is either politically or economically right. It may on occasions be the lesser of two evils, but it is not, in our opinion, a course that comments itself as being desirable in itself, which is the way that Labour Members regard it. This is Socialism, as so many Labour Members have said in the course of the debate, but to me it is Socialism not so pure and not so simple. I note in passing that Plaid Cymru may now be called Plaid Cenedlaetholi, which may be translated as the Welsh Nationalisation Party.

The hon. Gentleman prefers nationalisation, but, in his view, is unemployment preferable to nationalisation?

I do not think that question fits into the context at all. I shall be coming to that point soon.

Before the right hon. and learned Gentleman restores the Bill to its pristine form, let me plead with him to take various matters into account. First, there is the current economic situation and the Government's immense borrowing requirement that is now estimated at considerably more than the £9 billion given by the Chancellor in this Budget Statement. This may well necessitate cuts of some £2,000 million over three years, according to some pundits who are basing their view on the last quarterly bulletin of the Bank of England.

I am sure that the Secretary of State feels that the £100 million he can obtain for his agency under the Bill will be well spent. Part of it he is clearly committed to spending anyway. However, does the Secretary of State seriously believe that the new spending he has envisaged will be in the best interests of the country as a whole? If so, does he seriously believe that the Chancellor of the Exchequer will agree with him? I tell him bluntly that I do not think that he or his Bill will escape the public expenditure cuts to come, and I shall tell him why. It is precisely because he intends to use some of his funds for the purposes of Clause 1(3)(c). The money which he will have to do this will have been borrowed by the Government at a rate of interest which industry and commerce are finding it increasingly difficult to afford. If successful businesses cannot afford to borrow at such rates and remain solvent, what hope has a Government-sponsored new venture? It will be faced with the prospect of a loss right from the start.

It is all very well to back an existing industry, like British Leyland, when it is facing hard times, and try to tide it over, but it is an entirely different matter for the Government to become involved in new ventures, especially when we are in a world recession of the magnitude and depth of this one, and when the outcome of the renegotiation of the social contract is still unknown. I do not know how the Government think it possible to have wage restraint when they are flashing their money about like children at a funfair.

If the hon. Gentleman believes that no money will be available and, therefore, the Bill will be harmless, why does he intend to lead his troops, few as they are, into the Lobby against it tonight? Secondly, will he explain the constitutional novelty whereby we are dealing with a Bill the parts of which he finds offensive are not in it as proposed, and yet he intends to vote against Second Reading?

I will take the right hon. and learned Gentleman's second point first. He made it absolutely clear, and it was made abundantly clear in another place, that the Government propose to use the Bill as a vehicle for the return of the obnoxious clause about which I am talking.

To answer the first point, the right hon. and learned Gentleman may have the money for the consolidation aspects of the Bill, but he will not have the money to operate Clause 1(3)(c), which he insists on putting back into it. I warn the Secretary of State that by insisting on the restoration of Clause 1(3)(c) he is not only placing his own economic judgment in grave doubt but putting his Own head on the block within his own Government.

Last weekend we had the Prime Minister preaching that the end was at hand—within six weeks, I think—and pleading for a sense of urgency based on a cleat recognition that money cannot be spent twice because if it is pre-empted for income it is no longer available for public expenditure. But this is precisely what has happened and what may happen again. It is in this context that I believe the Bill may not survive the public expenditure cuts to come. Clearly, the Bill was conceived in happier times. It looks forward optimistically to a future which, alas, has become clouded with uncertainty. It has, therefore, lost its immediate relevance.

We wish that the Secretary of State was bringing forward a measure more apposite to the present situation. The right hon. and learned Gentleman accused us of being out of touch. It is he who is out of touch with the present situation in Wales.

I think that the Secretary of State has begun to realise that. When I pressed him on that point in the Welsh Grand Committee on 7th May his reply was modest. One might almost say that it was humble, which is the appropriate attitude for any Minister faced with our present unemployment figures in Wales. I asked:

"Do the Government really think that this is the answer to the economic problems of Wales now? Are they seriously saying to the 60,000 unemployed and those whose employment is threatened that the development agency will be their salvation? If so, they are deceiving the public and deluding themselves."
The right hon. and learned Gentleman replied:
"We have said quite clearly that we are part of the economy of the United Kingdom, that the heart of the matter is solving the problems of the United Kingdom as a whole. I said so today. But I believe that the Welsh Development Agency will be a vital part of the machinery that I need to tackle the problem. I put it no higher than that."—[Official Report, Welsh Grand Committee, 7th May 1975; c. 91.]

No, I will not give way.

We understand the need for machinery to consolidate control over the Welsh Office's various activities in the industrial and environmental sectors. We have no quarrel with that aspect of the agency. Nevertheless, we question the relevance of some of the Secretary of State's new powers under the Bill to cur current problems in Wales, some of which have been exacerbated by the Government.

I will give an example. In my constituency there is a factory which employs about 1,500 people manufacturing washing machines. The Chancellor has increased VAT on washing machines to 25 per cent. Those who work at the factory now live in fear of losing their jobs if orders fall off. That situation has been created by the Government. What is the relevance of the Bill to that situation?

One of the purposes of the agency is to maintain or safeguard employment, but can it do so in the face of counter-productive action by other Government Departments? That is the question that we have to answer. The situation in my constituency is a microcosm of what is happening in Wales and in the country as a whole. It is Government action that is responsible for much of our present unemployment and lack of investment.

I have quoted the OECD survey of the United Kingdom economy at the right hon. and learned Gentleman once before but I make no apology for doing so again. The survey reads:
"Investment intentions in manufacturing industry and business confidence weakened through 1974 to historically low levels. Poor profitability, the liquidity squeeze, rapid inflation, weak demand and uncertainty about Government plans for industry and the Common Market, may all have contributed to this."
That is a damning indictment from an impartial and objective source which we all respect. Clearly we must first get right our general economic and industrial policies. If I recall his words correctly, the right hon. Member for Anglesey (Mr. Hughes) said that this is all "pie in the sky" unless we get our economic policies right. When the United Kingdom flourishes, Wales flourishes, but that will not happen until the rate of inflation is reduced, until there is reasonable profitability, and until investors have the confidence to invest.

This Bill only tinkers with the edge of our problems and, insofar as the impression has been given that it does more than that, the Welsh public have been deluded and badly misled. The Government's function is to provide the framework in which business and industry can flourish. It is not the Government's function to run industry themselves. The Government should provide the infrastructure—for example, roads, sewerage and sites. Heaven only knows, there is enough work to do on those lines in Wales.

For the Government to become involved themselves in industry is an admission of failure. We may be sure that where private industry cannot succeed the Government will almost certainly fail. There will be little to show for their efforts except for the new style of dereliction which is revealed in the Government's accounts.

To sum up, I ask my right hon. and hon. Friends to oppose the Bill's Second Reading. The Government have indicated clearly that they intend to restore to the Bill those sections which we believe to be totally misconceived, unnecessary and mistaken both on political and on economic grounds. I refer to the sections which give power to the agency to extend public ownership, a principle which the more it is practised the more we abhor because of its costly results.

Secondly, we do not think that this is the right time to experiment with new ventures on dearly borrowed money. It is a time for restraint in public expenditure, as the Government well know. We accept that some of the expenditure under the Bill is inevitable in the sense that it was there before and necessary, but some of the new anticipated expenditure is gratuitous. I refer, of course, to the extension of public ownership. We doubt whether it can be other than wasteful in the long run.

Finally, we shall vote against the Bill because it is our first opportunity on the Floor of the House to express our grave displeasure at the Government's conduct of economic and industrial policies in Wales. The Bill before us will not be the salvation of the Welsh people. We are all agreed on that. But if it is not to be the salvation of the Welsh people, what is? The Welsh people are entitled to look to the Government for help. We are entitled to press the Government to think again and to try to devise solutions which are matched to our current problems.

The Bill is a mask to hide the Government's inability to deal with our problems, many of which they have created and exacerbated. For these reasons and others, I ask my hon. Friends to vote against the Bill.

9.35 p.m.

Perhaps the best comment I can make on the Opposition's opening and closing speeches is summed up in the phrase "bitter and mild"—"bitter" from the hon. Member for Pembroke (Mr. Edwards) and "mild" from the hon. Member for Conway (Mr. Roberts).

I listened attentively to the speech made by the hon. Member for Pembroke. I do not find it easy to find many points worth answering. We heard a good deal about the Opposition's view on the United Kingdom economy and there was much bandying about of highly tendentious statistics. The hon. Gentleman's speech seemed to bear all the hallmarks of the hard-nosed men in the Central Office research department. What it lacked was any contact with the people of Wales, their working lives and their wishes. I think that all Members of the House and all the people of Wales would have welcomed much more from the hon. Gentleman about the Bill. I suspect that the reason why we did not hear a lot about the Bill was that the hon. Gentleman genuinely found little to complain about. As for the hon. Member for Conway, his speech had a canine flavour to it. It was slightly rabid in parts and perhaps in many ways its bark was worse than its bite.

This has been a good and wide-ranging debate. I shall try to answer the points of detail which have been made. The Bill is a landmark in the economic history of Wales. It clearly commends itself to the great majority of people. Acceptance of the Bill cuts across party political boundaries, and it is hard to think of any proposal affecting Wales in recent years which has met with such approval. This is the case only because the purposes of the Bill are seen to be directed at the real needs of Wales and in a sensible and practical way.

As for the parentage of the Bill, I do not think there is any doubt about it. It is a Labour Bill and is very much the child of my right hon. and learned Friend the Secretary of State for Wales. It is true to say that no other political party had such detailed proposals to put before the House as those contained in the Bill.

Individual areas of Wales suffered many years ago from bad, sloppy economic planning—or, more accurately, from no planning at all. Worse still, the pursuit in the past of financal rewards with no concern for social or environmental implications has led to areas of great deprivation. Added to this, an excessive dependence on the two major industries of coal and steel has made our economy particularly vulnerable to attack when times are bad. Current problems and the awesome inheritance of yesteryear mean that we have mammoth difficulties to overcome. Clearly a radical solution is required. I believe that the agency will have the powers to make a contribution to setting things aright and preventing the mistakes of the past from happening again.

This is the first wholly Welsh Bill on economic, industrial and environmental matters. There are perhaps, in the English language, two novels—Llewellyn's "How Green was my Valley" and Cordell's "The Rape of the Fair Country"—which described the ravages of industrialisation in Wales in this and the last century—popular fiction which depicted grim fact. My right hon. and learned Friend's Bill repays a debt to generations past and offers hope for the future for the people of Wales.

Having emphasised the "Welshness" of the Bill, I should particularly like to draw attention to two points. The first is the subject of derelict land clearance. The county and district councils have this assurance from me. They will continue to play the major rôle in derelict land clearance. We will consolidate, not change, the existing arrangements. We will build on, not detract from, the strengths of the present system. We acknowledge the success of local councils so far in clearing dereliction. I have mentioned Richard Llewellyn, the novelist. He returned to Wales recently after some years' absence. In the Rhondda Valley, at Gilfach Goch, he could not recognise the place he revisited. The great tips had been removed, and the area was landscaped.

Nevertheless the agency has a substantial and important environmental rôle. The Welsh Office's Derelict Land Unit will merge into the agency. I expect to see the agency act as a catalyst to ensure a further surge forward to rid our beautiful land of the despoliation of the past. The rôle in derelict land clearance is crucial. Land for new housing and for factories is in short supply. The people of the valleys are entitled to live and work in an improved environment. This Bill offers them just that prospect.

I pay tribute to my right hon. Friend the Member for Anglesey (Mr. Hughes) for the great work he did at the Welsh Office, and in particular on having the vision and commitment to set up the Derelict Land Unit in Cardiff. That was a master-stroke for Wales. My right hon. Friend showed again in his speech his great involvement and experience in Welsh affairs. I echo the tribute he paid to the Mid-Wales Development Corporation. It is not intended that the agency should alter or detract from the work of the corporation. We are seeking to emphasise that the agency in its Mid-Wales rôle, will work in harmony with the corporation, and within this partnership a further strategy for developing and reinvigorating Mid-Wales can be worked out. My hon. Friend the Member for Brecon and Radnor (Mr. Roderick) made strong points on Mid-Wales in his very knowledgeable speech.

My right hon. Friend the Member for Anglesey and the hon. Member for Barry (Sir R. Gower) asked why there was no mention of agriculture in the list of requirements in Clause 2. This does not mean that experience in agriculture would not be of importance to the agency, and it is not excluded. Perhaps my right hon. Friend slightly misread the terms of the clause; it is not as exclusive as he suggested. It refers only to certain skills and experience which may be drawn upon, but it is open to the Secretary of State to look for people who will bring to the agency experience of other walks of life, not excluding agriculture

I accept that the provision is not exclusive, but the Government have gone to the trouble of naming certain other industries. Why exclude agriculture, which is the chief industry in most of Wales?

This is a Second Reading debate and I hoped I had shown in my speech that I had taken this important point on board.

My right hon. Friend the Member for Anglesey referred to some apprehensions expressed by the Association of District Councils. There is no cause for conflict about purchase of land. The existing arrangements are unaltered by the Bill. Second, there is no conflict on housing, because the agency does not have a housing rôle. The point about local government local representation will need to be considered further. There will certainly be an opportunity for discussion in Committee.

My right hon. Friend the Member for Anglesey, my hon. and learned Friend the Member for Abertillery (Mr. Thomas) and my hon. Friend the Member for Swansea, East (Mr. Anderson) made some valuable points about the locations of the agency. These will certainly be taken into account when the agency's locations are discussed.

It will be clear from the terms of the Secretary for State's speech that the agency will not be "cabin'd, cribb'd and contin'd" to, for example, Cardiff. As my right hon. and learned Friend made clear, the agency will have an all-Wales rôle and its locations will have to reflect that. The agency is not being placed in any way in a privileged position in relation to planning permission. This is made clear by the absence in the Bill of any provision to the contrary. We attach particular importance to this. I know that the local authorities in Wales do so too. This is one of the ways in which we emphasised and illustrate that the agency will he expected to act in partnership with local authorities and other bodies such as the Countryside Commission and the Nature Conservancy.

Questions have been raised about the agency's finances. We have made it cleat that there is no time limit on the expenditure. I would have thought that the reason for this is clear. It is impossible to predict how rapidly the agency will need to draw upon the financial resources at its disposal as this will depend upon a variety of matters, including the needs of industry for investment finance.

The speed at which the money will be spent will depend on what the agency determines it needs to carry out the job effectively. What is important is that the agency has sufficient resources now to get on with the job we are giving it, which will enable it to make an impact upon the problems facing Wales. A full opportunity will be afforded to Parliament to debate the raising of the limit from £100 million to £150 million, as hon. Members will see if they read Clause 16(4) of the Bill.

I want to make a brief reference to the point raised by the hon. Member for Caernarvon (Mr. Wigley) about the EEC. There is no inhibition upon the agency if it wishes to work in full partnership with organisations or agencies of the European Community. The details will be for the agency to work out with Brussels. The full range of Community finances will still remain available.

The hon. Member for Pembroke spoke at length on the subject of finance. He asked whether the money would be spent. That would seem to be a reasonable enough question, but I got the impression that he did not really want any money to be spent. We are talking about money to be spent for the benefit of the people of Wales in Wales. The money will be spent on matters of the highest priority like derelict land reclamation.

Is the hon. Member for Pembroke suggesting that £2½ million a year is enough for derelict land work? Surely he will agree that that sum is not enough. Is he suggesting that we cannot increase expenditure on the work of the Welsh Industrial Estates Corporation? Surely, again, he would say that it is not enough. I believe he is suggesting that nothing more should be spent on intervention in industry. Therefore, he had to be critical of the agency's whole spending. I am sure that the agency's board will spend wisely, well and with a due sense of priority on those jobs which all know in their hearts to be essential and right for Wales.

The hon. Member for Cardiff, North (Mr. Grist) seemed to be much exercised by the provision in paragraph 21 of Schedule 1 which relates to the Prevention of Fraud (Investments) Act. That paragraph prohibits the unauthorised distribution of circulars relating to investments. The Act as a whole gives complete freedom to exempted dealers to distribute such circulars. Most leading City institutions enjoy exempted dealer status.

The agency will be a body of high financial probity which will provide shareholders with a fair and honest account of the circumstances in which they are being asked to dispose of their shares. There are precedents for this in the Trustee Investments Act, the Charities Act, the Industrial Reorganisation Corporation and, indeed, the Industry Bill. I am not quite sure what the hon. Member was trying to impute in his remarks, but he might have taken the trouble to look at the provision to which he took exception before complaining. I hope that my remarks have helped to set his fear at rest.

Questions have been raised by the hon. Member for Caernarvon and the hon. Member for Cardiff, North on the relationship between the Welsh Development Agency and the National Enterprise Board. I am sure they will agree that much of this will be dealt with in detail in Committee.

I shall give three assurances to the House. First, the Government have undertaken to publish guidelines setting out details of the relationship when they are finalised. Clearly, this will not be before the agency and the board are in being since we wish both bodies to have an opportunity to participate in formulating the contents of the guidelines. It would make no sense to impose the guidelines on them. However, I can give an absolute assurance that the guidelines will be made widely available and that Parliament and industry will be fully aware of their contents.

Secondly, the agency will not be an arm of the NEB in Wales. We consider that a vitally important facet of the agency's responsibilities is that it should develop contacts with the whole of industry in Wales. It will be able to enter into discussions with any Welsh-based company or the management of any Welsh undertaking to establish how that company or undertaking can best contribute to the good of the Welsh economy. There is no question whatever of the agency's activities being limited to small, locally-owned companies, as some misguided critics have suggested. There will be much work for the agency to do in Wales, which it will be in a position to do entirely on its own.

I have dealt with many of the points raised by the hon. Gentleman.

Thirdly, when the NEB operates in Wales, as it must do, and if, for example, it is involved in companies operating on both sides of the border, it will do so in full consultation with the agency.

In conclusion, speaking now as a NorthWalian—the hon. Member for Flint, West (Sir A. Meyer), the hon. and learned Member for Denbigh (Mr. Morgan) and the hon. Member for Caernarvon spoke as North Walians—I feel sure that I can welcome the Bill on behalf of all those whose homes are in that part of the Principality. North Wales is an area of both outstanding natural beauty and major industry—from Snowdonia, the Isle of Anglesey and the Vale of Clwyd to the steel complexes at Shotton and the vigorous industrial life of Wrexham. Thus it has just those two aspects of life and work to which the Bill directly is addressed.

North Wales needs economic development and reinvigoration. It has many threats to face up to. Its steel industry must at least streamline itself. Twelve collieries have become but two. The slate quarries have closed. Our communications system requires improvement. West of Deeside, unemployment rates are uncomfortably high. These threats will be met strongly.

The area also has an environment to preserve. It will always be our objective to be able to develop new jobs without despoiling the environment. But the area also has many miles of bleak industrial dereliction—the unfortunate legacy of the past about which I spoke earlier—which need to be restored and given new life. This includes the forbidding spillage of the great Snowdonian slate quarries and the ubiquitous tips of the northeastern coalfield. It is my firm conviction that the powers in the Bill and the resources to be available to it will help to meet these objectives which all those whose heart is in North Wales must share with me.

I have said that this is a wholly Welsh Bill. It has been preceded by exhaustive and successful consultations with industry, organised labour and local government. It establishes an organisation for economic and environmental development which can bring great help to South Wales, Mid-Wales and North Wales. It creates a strong and flexible agency which will work very hard indeed to generate prosperity in the Principality in the decade ahead. It has both the financial resources and the power of the Secretary of State and the Welsh Office behind it.

I do not say that it is a magical and universal panacea for the problems that beset the Welsh economy. We have many problems, and we shall need as many measures as are necessary to overcome them. But this is an imaginative proposal which can contribute speedily and effectively towards the creation of a better and more secure way of life for all the people of Wales.

Division No. 247.]


[10.00 p.m.

Abse, LeoGourlay, HarryMurray, Rt Hon Ronald King
Anderson, DonaldGraham, TedNewens, Stanley
Archer, PeterGrant, George (Morpeth)Noble, Mike
Ashton, JoeGrimond, Rt Hon J.Oakes, Gordon
Atkins, Ronald (Preston N)Grocott, BruceOgden, Eric
Atkinson, NormanHamilton, W. W. (Central Fife)Orme, Rt Hon Stanley
Bagier, Gordon A. T.Harper, JosephOwen, Dr David
Barnett, Guy (Greenwich)Harrison, Walter (Wakefield)Padley, Walter
Barnett. Rt Hon Joel (Heywood)Hatton, FrankPalmer, Arthur
Bates, AlfHayman, Mrs HeleneParry, Robert
Beith, A. J.Heffer, Eric S.Pavitt, Laurie
Bidwell, SydneyHooley, FrankPeart, Rt Hon Fred
Blenkinsop, ArthurHoram, JohnPhipps, Dr Colin
Booth, AlbertHowells, Geraint (Cardigan)Rees, Rt Hon Merlyn (Leeds S)
Bottomley, Rt Hon ArthurHuckfield, LesRichardson, Miss Jo
Boyden, James (Bish Auck)Hughes. Rt Hon c. (Anglesey)Roberts, Gwilym (Cannock)
Bradley, TomHughes, Mark (Durham)Robertson, John (Paisley)
Bray, Dr JeremyHughes, Robert (Aberdeen N)Roderick, Caerwyn
Brown, Hugh D. (Provan)Hughes, Roy (Newport)Rodgers, George (Chorley)
Brown, Robert C. (Newcastle W)Hunter, AdamRoper, John
Buchan, NormanIrving, Rt Hon S. (Dartford)Rose, Paul B.
Butler, Mrs Joyce (Wood Green)Jackson, Colin (Brighouse)Ross, Stephen (Isle of Wight)
Callaghan, Rt Hon J. (Cardiff SE)Janner GrevilieRoss, Rt Hon W. (Kilmarnock)
Campbell, IanJay, Rt Hon DouglasRowlands, Ted
Carmichael, NeilJenkins, Hugh (Putney)Ryman, John
Carter, RayJenkins, Rt Hon Roy (Stechford)Sedgemore, Brian
Carter-Jones, LewisJohn, BrynmorShaw, Arnold (Ilford South)
Castle, Rt Hon BarbaraJohnson, James (Hull West)Sheldon, Robert (Ashton u-Lyne)
Cocks, Michael (Bristol S)Johnson, Walter (Derby S)Shore, Rt Hon Peter
Cohen, StanleyJones, Alec (Rhondda)Short, Rt Hon E. (Newcastle C)
Cook, Robin F. (Edin C)Jones, Barry (East Flint)Silkin, Rt Hon John (Deptford)
Corbett, RobinJones, Dan (Burnley)Silverman, Julius
Cox, Thomas (Tooting)Kaufman, GeraldSkinner, Dennis
Craigen, J. M. (Maryhill)Kelley, RichardSmall, William
Crawshaw, RichardKerr, RussellSmith, John (N Lanarkshire)
Cryer, BobKilroy-Silk, RobertSnape, Peter
Cunningham, Or J. (Whiten)Kinnock, NeilSpearing, Nigel
Davidson, ArthurLamborn, HarrySpriggs, Leslie
Davies, Bryan (Enfield N)Lamond, JamesStewart, Donald (Western Isles)
Davies, Denzil (Llanelli)Leadbitter, TedStewart, Rt Hon M. (Fulham)
Davies, Ifor (Gower)Lee, JohnStoddart, David
Deakins, EricLewis, Ron (Carlisle)Stott, Roger
Dean, Joseph (Leeds W)Lipton, MarcusStrang, Gavin
Delargy, HughLoyden, EddieTaylor, Mrs Ann (Bolton W)
Dell, Rt Hon EdmundLuard, EvanThomas, Dafydd (Merioneth)
Dempsey, JamesLyons, Edward (Bradford W)Thomas, Jeffrey (Abertillery)
Dormand, J. D.Mabon, Dr J. DicksonThomas, Mike (Newcastle E)
Douglas-Mann, BruceMcCartney, HughThomas, Ron (Bristol NW)
Dunn, James A.McElhone, FrankThompson, George
Dunwoody, Mrs GwynerhMacFarquhar, RoderickTierney, Sydney
Edwards, Robert (Wolv SE)Mackenzie, GregorTinn, James
Ellis, John (Brigg & Scun)Mackintosh, John P.Tomlinson, John
Ellis, Tom (Wrexham)McMillan, Tom (Glasgow C)Tomney, Frank
English, MichaelMadden, MaxTuck, Raphael
Evans, Fred (Caerphilly)Magee, BryanUrwin, T. W.
Evans, Gwynfor (Carmarthen)Mahon, SimonVarley, Rt Hon Eric G.
Evans, Ioan (Aberdare)Marks, KennethWainwright, Edwin (Dearne V)
Evans, John (Newton)Marquand, DavidWainwright, Richard (Colne V)
Ewing, Harry (Stirling)Mason, Rt Hon RoyWalker, Harold (Doncaster)
Faulds, AndrewMaynard, Miss JoanWard, Michael
Flannery, MartinMeacher, MichaelWatkins, David
Fletcher, Raymond (Ilkeston)Mellish, Rt Hon RobertWatkinson, John
Ford, BenMikardo, IanWeetch, Ken
Forrester, JohnMillan, BruceWelsh, Andrew
Fowler, Gerald (The Wrekin)Miller, Dr M. S. (E Kilbride)White, Frank R. (Bury)
Freeson, ReginaldMitchell, R. C. (Solon, Itchen)White, James (Pollok)
Freud, ClementMorris, Alfred (Wythenshawe)Whitehead, Phillip
Garrett, W. E. (Wallsend)Morris, Charles R. (Openshaw)Whitlock, William
Gilbert, Dr JohnMorris, Rt Hon J. (Aberavon)Wigley, Dafydd
Gould, BryanMoyle, RolandWilley, Rt Hon Frederick

The Welsh people in the British context have contributed much to our economy. They are entitled to this Bill, which I commend to the House.

Question put, That the Bill be now read a Second time:—

The House divided: Ayes 219, Noes 158.

Williams, Alan (Swansea W)Wilson, William (Coventry SE)
Williams, Alan Lee (Hornch'ch)Wise, Mrs AudreyTELLERS FOR THE AYES
Williams, Hi Hon Shirley (Hertford)Woodall, AlecMr. Donald Coleman and
Williams, W. T. (Warrington)Woof, RobertMr. James Hamilton
Wilson, Rt Hon H. (Huyton)


Adley, RobertGow, Ian (Eastbourne)Nott, John
Arnold, TomGower, Sir Raymond (Barry)Oppenheim, Mrs Sally
Atkins, Rt Hon H. (Spelthorne)Gray, HamishPage, Rt Hon R. Graham (Crosby)
Awdry, DanielGrist, IanParkinson, Cecil
Baker KennethGrylls, MichaelPercival, Ian
Bell, RonaldHall, Sir JohnPink, R. Bonner
Bennett, Dr Reginald (Fareham)Hamilton, Michael (Salisbury)Prior, Rt Hon James
Benyon, W.Harrison, Col Sir Harwood (Eye)Raison, Timothy
Berry, Hon AnthonyHayhoe, BarneyRathbone, Tim
Biffen, JohnHiggins, Terence L.Rawlinson, Rt Hon Sir Peter
Biggs-Davison, JohnHolland, PhilipRees, Peter (Dover & Deal)
Blaker, PeterHordern, PeterRenton, Rt Hon Sir D. (Hunts)
Boscawen, Hon RobertHowell, David (Guildford)Renton, Tim (Mid-Sussex)
Boyson, Dr Rhodes (Brent)Hunt, JohnRidley, Hon Nicholas
Brittan, LeonIrvine, Bryant Godman (Rye)Ridsdale, Julian
Brotherton, MichaelJames, DavidRippon, Rt Hon Geoffrey
Brown, Sir Edward (Bath)Johnson Smith, G. (E GrinsieadRoberts, Michael (Cardiff NW)
Bryan, Sir PaulJones, Arthur (Daventry)Roberts, Wyn (Conway)
Budgen, NickKellett-Bowman, Mrs ElaineRodgers, Sir John (Sevenoaks)
Carlisle, MarkKershaw, AnthonyRossi, Hugh (Hornsey)
Carr, Rt Hon RobertKnight, Mrs JillSainsbury, Tim
Chalker, Mrs LyndaKnox, DavidShaw, Giles (Pudsey)
Clark, Alan (Plymouth, Sutton)Lamont, NormanShelton, William (Streatham)
Clark, William (Croydon S)Lawrence, IvanShersby, Michael
Clarke, Kenneth (Rushcliffe)Lawson, NigelSilvester, Fred
Clegg, WalterLewis, Kenneth (Rutland)Sims, Roger
Cockcrofl, JohnLloyd, IanSpicer, Jim (W Dorset)
Cooke, Robert (Bristol W)Loveridge, JohnSpicer, Michael (S Worcester)
Cope, JohnMcAdden, Sir StephenSproat, Iain
Cormack, PatrickMacfarlane, NeilStainton, Keith
Corrie, JohnMacGregor, JohnStanbrook, Ivor
Costain, A. P.McNair-Wilson, M. (Newbury)Stanley, John
Dodsworth, GeoffreyMcNair-Wilson, P. (New Forest)Steen, Anthony (Wavertree)
Douglas-Hamilton, Lord JamesMadel, DavidStewart, Ian (Hitchin)
Drayson, BurnabyMates, MichaelStokes, John
Durant, TonyMather, CarolStradling Thomas, J.
Eden, Rt Hon Sir JohnMaude, AngusTaylor, R. (Croydon NW)
Edwards, Nicholas (Pembroke)Mayhew, PatrickTebbit, Norman
Elliott, Sir WilliamMeyer, Sir AnthonyTemple-Morris, Peter
Emery, PeterMiller, Hal (Bromsgrove)Thomas, Rt Hon P. (Hendon S)
Eyre, ReginaldMiscampbell, NormanTownsend, Cyril D.
Fairbairn, NicholasMitchell, David (Basingstoke)Trotter, Neville
Fairgrieve, RussellMoate, Rogervan Straubenzee, W. R.
Farr, JohnMontgomery, FergusVaughan, Dr Gerard
Finsberg, GeoffreyMoore, John (Croydon C)Viggers, Peter
Fisher, Sir NigelMore, Jasper (Ludlow)Weatherill, Bernard
Fookes, Miss JanetMorgan, GeraintWells, John
Fowler, Norman (Sutton C'f'd)Morgan-Giles, Rear-AdmiralWhitelaw, Rt Hon William
Fox, MarcusMorrison, Charles (Devizes)Wiggin, Jerry
Galbraith, Hon. T. G. D.Morrison, Hon Peter (Chester)Winterton, Nicholas
Gardiner, George (Reigate)Neave, Airey
Gardner, Edward (S Fylde)Nelson, AnthonyTELLERS FOR THE NOES
Glyn, Dr AlanNeubert, MichaelMr. Adam Butler and
Goodhew, VictorNewton, TonyMr. Spencer Le Marchant

Question accordingly agreed to.

Bill read a Second time.

Bill committed to a Standing Committee pursuant to Standing Order No. 40 ( Committal of Bills).

Business Of The House


That the Motion relating to the Welsh Development Agency (No. 2) Bill [Lords] may be proceeded with at this day's Sitting, though opposed, until any hour.—[Mr. Harper.]

Welsh Development Agency (No 2) Bill Lords


That, notwithstanding the proviso to Standing Order No. 62 (Nomination of Standing Committees), any Standing Committee appointed for the consideration of the Welsh Development Agency (No. 2) Bill [Lords] shall consist of Seventeen Members, including not less than Fourteen Members sitting for constituencies in Wales.—[Mr. Harper.]

Welsh Development Agency (No 2) Money

Queen's Recommendation having been signified—

Motion made, and Question put,

That, for the purpose of any Act of the present Session to establish a Welsh Development Agency and a Welsh Industrial Development Advisory Board, and for connected purposes, it is expedient to authorise—

(1) subject to the prescribed limit—

  • (a) the payment out of money provided by Parliament of the expenses of the Secretary of State in making payments to the Welsh Development Agency;
  • (b) the payment out of the National Loans Fund of sums required for making loans to the Welsh Development Agency;
  • (c) the payment out of the Consolidated Fund of sums required for fulfilling any guarantee given by the Treasury in respect of sums borrowed by that Agency;
  • and in this paragraph of this Resolution 'the prescribed limit' means the limit of £150 million imposed by the said Act of the present Session on the aggregate amount outstanding otherwise than by way of interest in respect of—

  • (i) the general external borrowing (as defined in the Act) of the Welsh Development Agency and their wholly owned subsidiaries;
  • (ii) sums issued by the Treasury in fulfilment of guarantees in respect of sums borrowed by the Agency from a person other than the Secretary of State;
  • (iii) sums paid to the Agency by the Secretary of State less repayments to the Secretary of State by the Agency and less sums paid in respect of the administrative expenses of the Agency; and
  • (iv) loans guaranteed by the Agency otherwise than in the exercise of powers conferred on the Secretary of State by section 7 of the Industry Act 1972 and exercisable by the Agency by virtue of the said Act of the present Session;
  • (2) the payment out of money provided by Parliament of any expenses of the Secretary of State incurred by him in consequence of any provision of the said Act of the present Session enabling him to pay compensation in respect of the loss of office of any person who suffers such loss in consequence of the said Act;

    (3) the payment out of money provided by Parliament of any administrative expenses of the Secretary of State incurred by him in consequence of any provision of the said Act.

    And that it is expedient to authorise any payment into the Consolidated Fund or the National Loans Fund under the said Act of the present Session.—[ Mr. Harper.]

    On a point of order, Mr. Speaker. It would be wrong for the Money Resolution——

    If there is any doubt about the matter, I have always ruled in favour of further discussion. Sir Anthony Meyer.

    10.15 p.m.

    I am obliged to you, Mr. Speaker. It would surely be wrong that a sum of money such as the one under discussion should be agreed to on the nod, without any debate. Here is a matter of £100 million which is to be expended in pursuance of objects which have not been all that clearly defined. We have had a very long debate during which a large number of hon. Members have spoken in the most general terms in favour of the Bill, and most of them have spoken as if, by some wave of a wand, every possible benefit would be conferred upon Wales. But we have heard very little mention of the very large sums of money which will be needed to bring these benefits. Those sums of money have to be raised, and they will be raised very largely by impositions on the very firms which have to provide the employment which the Bill sets out to provide.

    We do not know enough about how the money is proposed to be expended. However, we know that the Money Resolution contains a provision whereby the £100 million may be increased to £150 million, and, as I said earlier, that increase may come a lot sooner than anyone at present supposes.

    Anyone who takes the trouble to refer to the back of the Bill will discover that it now costs 42p. When it was first printed less than two months ago, it was priced at 29p. As I said earlier, that represents a current rate of inflation of 270 per cent. based on the Healey formula. If we are to have inflation at that rate of advance, it will be only four months at the outside before the Government have to ask for the increase to £150 million provided for in the Money Resolution.

    We need a great deal more information, and I am sure that others of my hon. Friends will want to press the Government on this matter. Frankly, we do not know enough.

    10.20 p.m.

    I second what my hon. Friend the Member for Flint, West (Sir A. Meyer) said. Our judgment of the value of the amount appropriated depends largely on the approximate timetable. I hope that the Government spokesman will tell us how the money will be spent and over what period, as that is a matter of uncertainty. We have been told that it may be spent over an indefinite period and that the sum may be increased from £100 million to £150 million. We have no idea of the timetable. The Government spokesman should indicate the approximate timetable.

    Considerable amounts are involved. I appreciate that the rate of inflation is increasing so rapidly that the £100 million will have lost its value so that £150 million will soon be required. That is the strange state of affairs with which we are faced. I hope that the Government will elucidate those points.

    10.22 p.m.

    I think that the points which have been raised by my hon. Friends are of considerable importance. I am extremely surprised that when the Money Resolution was put to the House a few moments ago no Government spokesman sprang up from the Government benches to give us the Government's explanation of the points which are involved in it. That is a lighthearted way in which to treat the House during its consideration of the expenditure of £150 million. It was lighthearted of the Government to expect this measure to go through without any debate or explanation from the Government.

    I have been present for part of this debate, although most of the time I have been attending a Standing Committee which has been considering a financial matter. I shall not go into detail, but I have been here as much as I could. I was present when the Minister, in winding up, said that there was no time limit on expenditure and that it was impossible to predict exactly when the money would be expended, and so on. But that was not good enough.

    Last night there was a debate on the provision of £300 million for the Scottish Development Agency. When we pressed the Minister we were told that it was impossible to say exactly how much would be spent this year, but that the Chancellor of the Exchequer had taken account of all this and that it came within the contingency reserve which is mentioned in the Public Expenditure White Paper. I have looked that up. Admittedly, it is expressed in different terms. Nevertheless the sum for the contingency reserve for the current year is £300 million. That takes into account the resource costs of the Scottish Development Agency, the Welsh Development Agency, the child endowment scheme, the National Enterprise Board, and many other schemes. We should therefore like to know roughly how much is contained in the contingency reserve for this year of the £150 million mentioned in the Money Resolution which we are discussing.

    I should like to go into more detailed points concerning the Money Resolution. Paragraph (1)(iii) mentions
    "sums paid to the Agency by the Secretary of State less repayments to the Secretary of State by the Agency and less sums paid in respect of the administrative expenses of the Agency."
    There is no mention of payments made by the agency in consideration of receiving public dividend capital. Public dividend capital is involved here. Yet it was excepted in the equivalent resolution in respect of the Scottish agency. Why, then, has it not been excepted in the case of the Welsh agency? I refer to the point in the Scottish Money Resolution concerning repayments made by the agency in consideration of receiving public dividend capital.

    Again, according to Schedule 3 of the Bill, the Welsh Development Agency is able to borrow money in certain circumstances—not by means of temporary loans—from the Commission of the European Communities or the European Investment Bank. The Minister said something in passing about the relationship with the Community institutions. Nevertheless, nothing of that kind was included in the Money Resolution involving the Scottish Development Agency. Why the difference? We should like to know more about borrowing intentions from the Commission of the European Communities and the European Investment Bank.

    But, above all, this is a vast sum of money. How much of the £150 million is expected to get a commercial rate of return? How much is for social purposes and is not expected to get a commercial rate of return? Of the amount that is expected to get a commercial rate of return, what is the target rate of return which the Treasury set for the Welsh Development Agency?

    The pound today is at an all-time low, and has been falling steadily. At a time when uncertainty is the worst thing for confidence in the pound, and when public expenditure is at the heart of our economic crisis, we need to know precisely how much public expenditure is involved this year and how much is involved in subsequent years.

    I hope that the Minister will address himself to these few questions. There are many more I could ask but I am sure that my hon. Friends will wish to pursue the matter.

    10.26 p.m.

    I am sure the whole House is grateful to my hon. Friends the Members for Flint, West (Sir A. Meyer), Barry (Sir R. Gower) and Blaby (Mr. Lawson) for raising these important matters on the Money Resolution. We do not apologise for raising this matter at this late hour because the House is increasingly failing to pay proper attention to its traditional Supply rôle. I apologise for not being here throughout the debate, but I have been in Standing Committee. However, I heard the Secretary of State's speech and the winding-up speeches on the Bill.

    Not enough has been said about the expenditure proposed. Either the £150 million will be spent—in which case we are right to ask for more information about how it will be spent and how quickly—or it will not be spent. It may be that a small proportion only will be spent because the Chancellor of the Exchequer cuts back expenditure within the new few weeks or because the Treasury withholds its consent for particular schemes, which is much more likely. In that case the £150 million mentioned would be a deception on the people of Wales. If the Chancellor cuts back on expenditure or if no schemes materialise, the Bill will prove to be a public relations exercise and not an exercise of substance.

    In winding up the Second Reading debate the Minister spoke in brave language about the Bill being a landmark in the history of Wales. He said that the Bill paid a debt to generations past. The Money Resolution is part and parcel of the Bill. Only time will tell whether the money covered by the Money Resolution is forthcoming.

    Last night when the Minister of State wound up the debate on the Second Reading of the Scottish Development Association (No. 2) Bill he said that the amount which may be spent in the current year would depend on when we could establish the agency and how successful it was in its early stages in identifying useful ways of spending the money which is available to it. That is a strange way of going about the matter in the economic conditions which we face.

    My hon. Friend the Member for Blaby referred to the contingency reserve. We all know that the contingency allowance in successive White Papers has proved to be inadequate. We understand from Press reports of what was said in the Expenditure Committee proceedings recently that within a few weeks after the publication of the figure for the contingency reserve it was shown that the British Leyland project alone had taken up far more than was expected a few weeks before. It is not good enough to say that the contingency reserve will meet the additional payments under the Money Resolution.

    As far as I understand from what the Secretary of State said, about £60 million a year is being spent on selective assistance, regional development grants and the regional employment premium, and about £8 million or £9 million has been included in this year's Financial Statement as expenditure by the agency. That £8 million or £9 million applies only to part of the year, because the agency will not be established for the whole of the financial year.

    It is reasonable for my hon. Friend the Member for Flint, West and others to ask more about how the £100 million is to be broken down over time before an order comes forward proposing the additional £50 million. We can understand that the pace at which opportunities will arise cannot be precisely determined. But we have had the Chancellor of the Exchequer making speeches at the Dispatch Box and making innumerable speeches in the country in the last few months in which he said that it was essential to establish limits on the amount that was being paid out of the public exchequer. Yet, within a few days, we have had two measures, one for £300 million and the other for £150 million, which, in terms of time, are completely open ended. At one moment we have the Chancellor saying that we have to establish limits on public expenditure and a few days later we have amounts totalling £450 million coming before the House without any time limit being placed on them. This is going on the whole time.

    All the Treasury spokesmen on this side of the House, with names like Howe and Howell, derive from the Principality. My name does not sound Welsh, but my family, too, comes from the Principality. Therefore, we fully understand the needs of Wales. None of us feels that it is the job of Treasury spokesmen or Treasury Ministers to interfere in the specific details of expenditure in the Principality. However, we suggest that what is proposed in this Money Resolution and what was proposed in the one last night cannot be in conformity with what the Chancellor has said in the past few days.

    I shall not delay the House much longer, but I must give two examples of the kind of thing that is happening day by day. I hope that the Secretary of State, or whoever is to answer the questions which have been asked, will pay attention to these short, specific examples which I want to mention.

    The Secretary of State will know and be proud of the Royal Mint building in Llantrisant. I have seen it and been round it several times. It was only a very few years ago that the Royal Mint at Llantrisant was completed at a cost of £6·24 million. Yet only a few months ago—in fact, in April—the Royal Mint was turned into a trading fund. When the trading fund measure came before the House, that same building, which had cost £6·24 million to erect, was included in the opening accounts of the Royal Mint Trading Fund at £2·4 million. Therefore, in only a very few years, approximately £3·8 million has been written off and nobody has said a word about it. It has all disappeared and been paid for by the taxpayer.

    I should like to know whether the Welsh Development Agency would have financed the building of the Royal Mint at Llantrisant or whether the money would have been forthcoming from other funds. In a way, the Royal Mint was a development project. It was built at Llantrisant to provide employment in the Principality. How is it possible that in only a few years the taxpayer has had to meet a loss of £3·8 million?

    I take my second and final example——

    The Secretary of State says that this is a frivolous example. That is a perfect case of the total lack of interest and understanding on the part of Socialist spending Ministers in the financial state of this country. The Secretary of State, from a sitting position, said that it was a triviality that £3·8 million had been written off a project in only a few years. That is the kind of attitude that the people of Wales will not understand.

    The hon. Gentleman has been a Treasury Minister and he should make his representations to the House on relevant grounds. He should not raise matters that have no connection with the Bill and deal with an example that has little relevance in this context. He should know better.

    I can understand that the Secretary of State is embarrassed about the example that I have put before the House, and I shall not follow him down that road. I have made my point. Why has that amount of money been written off in only a few years?

    I come to my final example. I hope that the Under-Secretary of State will answer this point. We notice that it will cost £2½ milion to run the agency when it is fully established and that 150 million extra people will be required—

    Even given the rate at which people are being taken on in the public sector, I agre that the million was a minor exaggeration. I want to say that we know that 150 additional staff will be taken on to run the agency. Why are they needed over and above the stall now involved in dealing with selective assistance? I understand that a total of 300 posts is involved at the present time.

    We have not delayed the House for very long, given the amount that is involved. I hope that this short debate has taken place in a good spirit. I speak as one Celtic representative to another. I shall not go into what I think about the discrepancy between what Wales receives and what my own part of the country receives. The disparity is really quite disgraceful, but I leave the matter there. Perhaps the Under-Secretary of State will answer the points that have been raised by my hon. Friend and myself.

    10.37 p.m.

    Welsh Office Ministers are always glad to come to the Dispatch Box at this time of night. I fully take the point of the hon. Member for St. Ives (Mr. Nott), that he is as good a Celt as I am. I understand that he is trying to establish his credentials as a former Treasury Minister in order to make his point about the agency.

    I appreciate the point raised by the hon. Members for Flint, West (Sir A. Meyer), Barry (Sir R. Gower) and Blaby (Mr. Lawson), the hon. Member for Blaby not having been present for the previous debate. I am thoroughly aware that the Bill will be considered in Committee and that various matters can be explored in detail.

    The hon. Member for Blaby referred to public dividend capital. I believe that that subject was first mooted by my right hon. Friend the Secretary of State for Defence when he had a position in a previous administration. A similar point was raised last night when the Scottish agency was being discussed.

    Is the public dividend capital to be in addition to the £150 million borrowing or is it to be counted within that sum?

    I am grateful for that helpful intervention. The hon. Member for Blaby can be assured that the Welsh will do as the Scots do. We shall consider an amendment parallel with action taken by the Scots to cover the point of public dividend capital. I thank the hon. Gentleman for raising the point, which at a later stage we can consider thoroughly.

    I wish to deal with the point raised by the hon. Member for Barry and the hon. Member for Flint, West. It is hard to predict how the Welsh Development Agency will need to draw on financial resources. This will depend on factors such as the need of Welsh industry for investment finance and the availability of land and labour to carry out environmental projects, as well as the speed with which the agency can devise plans and implement schemes. The inflation of building costs will be a factor. Although the Government had in mind an initial five-year programme of work for the agency, its funds are not limited to any period, and after the initial tranche of £100 million a further £50 million will be available on the order of the Secretary of State, subject to the approval of the House.

    Before the Minister concludes, could he answer the point about borrowing from the European Investment Bank and other European institutions?

    The hon. Member has raised a number of points about borrowing powers. After further consideration, I can inform him that the public dividend capital will be within £150 million.

    Question put and agreed to.


    That, for the purpose of any Act of the present Session to establish a Welsh Development Agency and a Welsh Industrial Development Advisory Board, and for connected purposes, it is expedient to authorise—

    (1) Subject to the prescribed limit—

  • (a) the payment out of money provided by Parliament of the expenses of the Secretary of State in making payments to the Welsh Development Agency;
  • (b) the payment out of the National Loans Fund of sums required for making loans to the Welsh Development Agency;
  • (c) the payment out of the Consolidated Fund of sums required for fulfilling any guarantee given by the Treasury in respect of sums borrowed by that Agency;
  • and in this paragraph of this Resolution 'the prescribed limit' means the limit of £150 million imposed by the said Act of the present Session on the aggregate amount outstanding otherwise than by way of interest in respect of—

  • (i) the general external borrowing (as defined in the Act) of the Welsh Development Agency and their wholly owned subsidiaries;
  • (ii) sums issued by the Treasury in fulfilment of guarantees in respect of sums borrowed by the Agency from a person other than the Secretary of State;
  • (iii) sums paid to the Agency by the Secretary of State less repayments to the Secretary of State by the Agency and less sums paid in respect of the administrative expenses of the Agency; and
  • (iv) loans guaranteed by the Agency otherwise than in the exercise of powers conferred on the Secretary of State by section 7 of the Industry Act 1972 and exercisable by the Agency by virtue of the said Act of the present Session;
  • (2) the payment out of money provided by Parliament of any expenses of the Secretary of State incurred by him in consequence of any provision of the said Act of the present Session enabling him to pay compensation in respect of the loss of office of any person who suffers such loss in consequence of the said Act;

    (3) the payment out of money provided by Parliament of any administrative expenses of the Secretary of State incurred by him in consequence of any provision of the said Act.

    And that it is expedient to authorise any payment into the Consolidated Fund or the National Loans Fund under the said Act of the present Session.

    Northern Ireland (Emergency Powers)

    10.45 p.m.

    I beg to move,

    That the Northern Ireland (Various Emergency Provisions) (Continuance) Order 1975, a draft of which was laid before this House on 9th June, be approved.
    The Order has been laid to renew the provisions of the Northern Ireland (Emergency Provisions) Act 1973 and the Northern Ireland (Young Persons) Act 1974, which are due to expire at midnight on 24th July.

    On a point of order, Mr. Deputy Speaker. Many of us regard this as a very important debate. Will you ask our colleagues to leave the Chamber quietly?

    Will hon. Members who do not intend to listen to the Secretary of State kindly leave the Chamber as expeditiously as possible.

    The order will renew the provisions for six months until 25th January 1976. The House will know, however, that there is a Bill which has been given a First Reading, to amend the Emergency Provisions Act.

    When I last sought renewal of these powers, on 5th December, I said that I would do everything possible to introduce new legislation between then and now. It has not been possible for new legislation to be passed, but it is now before the House and we are to debate it tomorrow.

    The point of the order is to allow for the fact that the Bill is unlikely to pass through both Houses before 24th July. However, the amendments to the Act proposed in the Bill will have an effect on commencement, and I hope this will be long before the expiry of the six months. Much will depend on the Committee stage. The order, like the Act, is of great importance to the security forces in Northern Ireland.

    In seeking approval of the order, I am seeking to cover the transitional period of the passage of the Bill. The new temporary provisions of the Bill, which cover everything except Section 1 of the Act, will also expire on 24th January 1976, so that all the temporary provisions, whether amended or otherwise, will need to be continued by order from that date if Parliament considers them still to be necessary.

    The Second Reading of the Bill is to take place tomorrow, and it would not be appropriate for me to describe its provisions in this short debate, but, clearly, the order needs to be considered in that context. In Opposition we had doubts about a number of the provisions of the emergency provisions Act, although we clearly recognised the need for extraordinary powers to deal with the security situation in Northern Ireland. As I said in Opposition on the Second Reading of the Northern Ireland (Emergency Provisions) Bill:
    "The Government of the United Kingdom, like the Government of Northern Ireland, have a duty to deal with those who shoot and kill, and we are certainly not arguing the contrary. The Government have the right to take extraordinary measures given the situation in Northern Ireland".—[Official Report, 17th April 1973: Vol. 855, c. 292.]
    On assuming office, I appointed a committee under the chairmanship of Lord Gardiner to examine the working of the Act and to consider what provisions and powers were necessary, consistent to the maximum extent with the preservation of civil liberties and human rights, to deal with terrorism and subversion. The Bill which the House is to debate tomorrow is based upon the recommendations of its report.

    There are, however, a number of provisions in the emergency provisions Act which the committee considered should remain unchanged, and it is only right, therefore, that I should mention these now as the Bill does not apply to them. It is also right that I should justify the continuing need for emergency provisions at all.

    As I explained in answer to the Private Notice Question by the right hon. Member for Down, South (Mr. Powell) on 16th June, the nature of violence in Northern Ireland has changed in the past six months. The Provisional IRA ceasefire has generally held well, and the incident centres have helped to prevent misunderstandings. This undoubted achievement should be recognised by all.

    There has been a significant reduction in incidents against the security forces and an overall reduction in terrorist incidents. This has exposed, or perhaps brought to the surface, much interfactional violence and violence between the communities in Northern Ireland, violence which has involved deliberate cold-blooded murder of particular persons. Already this year 100 civilians have been killed by violence for which in many cases there was no apparent motivation, however tortuous or misguided.

    It is clear that this new age of violence has not arisen out of political aspirations; it is an outbreak of gangsterism fostered no doubt by the atmosphere of disrespect for the law—and for people's lives—in recent years. There are some in Northern Ireland who give encouragement to these thugs with talk of Armageddon between the communities. Such speculation is used by gangsters to give credibility to their motives and plays into their hands.

    In a community which lives with the threat and the fact of violence, a heavy burden rests upon leaders of public opinion. In the past, much of the condemnation of murders and other outrages has itself tended to reflect the division in the community. It is a welcome and realistic development that on all sides in Northern Ireland today there is a denunciation of violence, from whatever source. I have not always noticed that.

    It takes political and physical courage of a high order for people in Northern Ireland to condemn those criminals who claim to act, however spuriously, in the name of the cause for which those people stand. In recent days that courage has been shown, not least by some politicians who have unequivocally condemned the violence practiced by those who claim to support them.

    The key to dealing with gangsterism is effective policing. I am glad to report again that the RUC is achieving very considerable success and has taken steps to respond to this new situation. This morning the Chief Constable announced further measures to combat the vicious campaign of assassinations, sectarian and otherwise. The RUC's preventive and detective capabilities are being reinforced by the creation of a special centralised CID unit, to be known as the A Squad. This squad would be a strong, mobile, co-ordinated detective squad backed up by the full resources of the special patrol group, able to respond quickly and effectively to situations anywhere in Northern Ireland in support of the work of the local police. This new development has been made possible by an overall expansion of the detective branch of the RUC.

    Already this year over 568 persons have been charged with terrorist type offences, and 171 travelling gunmen have been intercepted. One wonders where they were on their way to and how many people would be dead if they had not been intercepted. These figures do not reach the headlines as do figures for the number of persons for whom interim custody orders are signed. If I were to sign one interim custody order there would be headlines. The fact that 568 people pass through the courts seems to be unnoticed, yet that is the most important development in the last few months, and it is a trend which has been growing over the months. The figures demonstrate clearly the success of the RUC in dealing with crime.

    There are other encouraging signs in Northern Ireland at present. The monthly average of shooting incidents this year compared with the monthly average for 1974 has fallen from 267 to 137, explosions have fallen from 57 to 26, and killings only from 18 to 17. The Provisional IRA has maintained its cease-fire in general for over six months, and there are signs of the two communities recoiling in horror at continued atrocities. At the same time, however, the monthly average of civilian deaths has risen from 14 to 16, and the indiscriminate violence of the past two weekends has demonstrated that terrorism continues in all its savagery. While terrorism continues, so must the powers necessary to deal with it.

    Such acts cannot be tolerated in our society, and the Government and Parliament are responsible for security in Northern Ireland. The police, backed by the Army, cannot achieve results, and the courts cannot convict those who are guilty, if special provisions in the law are not in force. Moreover, and I wish to place special emphasis on this point, we should be failing in our duty to the police officers and soldiers if we did not give them appropriate powers to act against terrorists and to protect themselves.

    I am not proposing any changes in the powers of the security forces in the emergency provisions Act except clarification of their powers to stop and question persons and a new power to search for and seize radio transmitters. The Gardiner Committee considered very carefully the existing powers, and suggestions that they should be curtailed, and came to the conclusion that it would be impracticable to impose further conditions and, in the light of the evidence it received, unnecessary.

    We are also proposing to retain the procedure for a single judge without a jury to try scheduled offences on indictment. We entertained considerable doubts about this when in Opposition and proposed that three persons should conduct the trial. The Gardiner Committee reported that it was given details of 482 instances in which civilian witnesses to murder and other terrorists offences were too afraid to make any statement or to give evidence in court. The committee concluded that juries would be equally open to intimidation We were wrong in Opposition. The committee also reported wide agreement among those who gave evidence before it that the system has worked fairly and well. My right hon. and learned Friend the Attorney-General is also satisfied of the fairness of the present procedure, and accordingly we have accepted the Gardiner Committee's recommendation that no change should be made.

    The Gardiner Committee also recommended that the powers of proscription in Section 19 of the 1973 Act should be retained. I agree with the Gardiner Committee that such powers should be retained on a temporary basis for the reasons it gave; namely, that it deters people from providing financial or other support for what are clearly terrorist organisations, and that it would be anomalous to legalise organisations which are proscribed throughout both the Republic of Ireland and the remainder of the United Kingdom. I keep constantly under review, however, the list of pros-scribed organisations. Many considerations have to be taken into account in this continuing review. For example, there is the question of proscribing organisations claiming responsibility for sectarian violence.

    We have to be careful here not to jump to immediate conclusions. Prosscription is a remedy against the identifiable group with an organisational structure and a continuing existence. It is not an effective remedy against casual groups, which are prepared to change their names when the going gets rough, to dissolve themselves to suit their convenience and possibly to coalesce, often with different members and in a new guise at a later stage. In these circumstances proscription could be an empty gesture, since legal proof of membership of an organisation that scarcely exists is, naturally, difficult to obtain. The best way to proceed against men of violence who profess to belong to groups such as these is through the ordinary courts. However, I keep this matter under continuous review and will use the power of proscription when it can be effectively deployed.

    Although this order continues the provisions for detention, completely new provisions are included in the Bill, and hence I propose to deal with this subject in some detail tomorrow. It would be appropriate for me to say now that, however much I dislike the principle of detention without trial, I am in no doubt that such powers are necessary in Northern Ireland at present. I am not exercising the existing powers at present. Indeed, I have not signed any interim custody orders since 9th February. If the situation requires me to return to "ICO-ing", I shall, of course, inform right hon. and hon. Members immediately, if the House is sitting.

    Since the Provisional IRA announced its cease-fire on 22 December, I have personally released 276 persons from detention. If, however, the security situation were to deteriorate rapidly tomorrow, next week or next month, I should need a power of detention, and in the current situation I should not hesitate to use it if that were the only way of removing vicious killers from the streets. But it is only as a last resort that I have used the powers of detention, and that continues to be my policy and that of the Government.

    I do not want to return to the use of "ICO-ing" I want to go through the courts, but if there were a military cam- paign with the middle of Belfast burning in the way we have known in the past, we should not be able to stand back.

    I now turn to the Northern Ireland (Young Persons) Act. This order also extends the provisions of that Act for six months to 25th January 1976. The Act was introduced to deal with the problem of young terrorists on remand who escaped from remand homes. It provides power for the Secretary of State to make a direction that a young person charged with a scheduled offence be held in custody in prison rather than a remand home.

    Although the provision is concerned only with a very small group of persons, it is necessary in order to protect the public from further acts by young terrorists, to protect the staff of remand homes from rescue attempts and to protect the young person himself. I gave an assurance that I would use these powers sparingly.

    Since the Act came into force on 1st August 1974, I have given directions only in respect of 15 young persons, although at present no directions are in force. Absconsions from remand homes have continued, but the provision is not intended to prevent that. I have used the power only for the reasons I have just given, and none of those committed to secure custody has escaped. This provision is still necessary, regrettably, and accordingly I am seeking its continuance.

    I am aware of the feeling that young persons should not be kept on remand in custody for longer than is absolutely essential. As the House will understand the duration of remand is not within my control, but the matter has been discussed with the Attorney-General and the Director of Public Prosecutions for Northern Ireland. Every effort is being made to restrict the period of remand, and in only one case has it exceeded six months, and then only by a few days.

    The powers in the emergency provisions Act are at present essential. They are essential not only because I may need them in order to apply interim custody orders but because they provide the legal basis for the security forces to act against terrorists. There must be a power for police officers and soldiers to arrest terrorists, to stop and question persons, and to search for arms and explosives. The powers are also essential if the courts are to maintain the rule of law, and the powers are essential if the Government and Parliament are to fulfil their responsibilities to the ordinary law-abiding citizen in Northern Ireland.

    I am asking tonight for the renewal of the emergency provisions Act. I am conscious that the security situation in Northern Ireland is changing. Nevertheless, what I argued in my White Paper of July 1974 on the Northern Ireland Constitution, that
    "the Army cannot, however, replace the police, nor would it be a substitute"
    is still relevant in the new unfolding situation.

    The Government wish to see a return to effective policing in Northern Ireland, but, new situation or not, I have to be prepared for all eventualities.

    11.3 p.m.

    We understand why the debates tonight and tomorrow are to take the course decided upon. Indeed, the Secretary of State alluded to the reasons tonight, and logic does not always attend Irish legislation. It might, however, have been more logical for the House to have had a debate long since on the Gardiner Report, which, after some hesitation and delay, the Secretary of State presented to Parliament last January, before proceeding to the anti-terrorist measures.

    It would have been more logical to have amended the emergency provisions before extending them. However, the amending Bill will be taken tomorrow, and we are grateful that so important a Northern Ireland measure will be debated in the light of day. In the meantime, the Irish night shift must address itself to this order.

    It would be criminally irresponsible for the House to deny or delay the powers which the Secretary of State seeks, but I and, no doubt, other hon. Members would like to ask some questions.

    I would first refer to special category status. Lord Gardiner's committee declared this status to be an error, and that is admitted on all sides, but, of course, there are difficulties. If retrospection is ruled out, one can understand that. However, many of us thought at the time, and said at the time, that the Price sisters should not have been moved out of England to enjoy special category status. Visitors to Armagh Gaol learn of the resentment that this excites in what I am tempted to call decent criminals there immured. The difficulty of the Secretary of State is the absence of cellular prison quarters to replace the academy of revolutionary studies at the Maze.

    The Gardiner Report was scathing on the inadequacy of cellular accommodation. Hon. Members will have read paragraph 113 of the report, which states:
    "The present situation of Northern Ireland's prisons is so serious that the provision of adequate prison accommodation demands that priority be given to it by the Government in terms of money, materials and skilled labour such as has been accorded to no public project since the Second World War."
    To date not one brick has been laid. The land has not even been acquired. Surely in a war-like situation some of the niceties of planning procedure could be abbreviated. After all, the Gardiner Report said this at the end of paragraph 113:
    "If no Government sites are available, emergency legislation should be passed to give the Secretary of State general powers to acquire suitable sites at once without the delays consequent on normal compulsory purchase and planning procedure."—[Interruption.]
    I am only reading to the House the words of the Gardiner Report. I should like to make my speech, if the right hon. Gentleman the Minister of State will allow me.

    It is my hope that these debates will demonstrate that there is no weakening of the democratic will to win. Conservative Members welcome the Secretary of State's robust, affirmative reply to the supplementary question put by my hon. Friend the Member for Abingdon (Mr. Neave) to the Private Notice Question by the right hon. Member for Down, South (Mr. Powell) on 16th June. The Secretary of State left the House in no doubt that Her Majesty's forces would continue in support of the civil power until normal policing by the Royal Ulster Constabulary is possible throughout the Province. We are grateful to the Secretary of State for that assurance.

    The courage, the skill and the patient endurance of the Regular Army, the Ulster Defence Regiment, the Royal Ulster Constabulary—we heard—with interest and we welcome what was said about the new A Squad—must not be thrown away. That would make a mockery of the tributes we pay them in this House, which we renew this evening.

    From time to time apprehension has been expressed lest the cease-fire has meant that less intelligence has been gathered and the guard to some extent lowered. During the present year searches for arms and explosives seem to have been mostly of unoccupied houses. Perhaps the Minister will comment on that, when he replies.

    In April I understand that 140 lbs. of explosives were discovered and in May 21 lbs., whereas last year the general monthly rate of finds was in four figures. I trust that the explanation is that diplomacy and security have stopped supplies to the terrorists and those gangsters whom it is about time both official statements and the media desisted from describing as either Protestants or Catholics.

    The Queen's peace must be restored, otherwise what use is it to discuss a Bill of Rights or United Kingdom standards?

    The Minister for Posts and Telegraphs in Dublin, Dr. Conor Cruise O'Brien has warned of what he called "fake liberals" who:
    "protest against all repressive legislation."
    However, he said that:
    "The laws against crime are necessarily repressive, and armed conspiracy is the most dangerous of crimes."
    The order is justified, and we support it.

    11.10 p.m.

    The Secretary of State has had his task made rather more difficult for him this evening by the order in which he has been obliged to take matters. He has been asking for the renewal of powers unaltered when the whole House knows that it is his intention to ask for very substantial alterations in them. He has, therefore, had necessarily to present one of two halves of the same picture.

    Nevertheless, there is no doubt that, amended or unamended, the powers which the House, I am sure, will renew this evening arise out of the actual situation in Northern Ireland. It would be absurd for this debate not to concern itself, as indeed, the speech of the Secretary of State concerned itself, with that situation.

    The Secretary of State was indeed right when in a letter to my hon. Friend the Member for Antrim, South (Mr. Molyneaux) he referred to these debates of tonight and tomorrow as giving an opportunity
    "for the subject of the cease-fire and the security situation in general to be fully ventilated on the Floor of the House."
    I am sure that the Secretary of State will be among the first to admit that he has received steady, though not uncritical, support during his months of office from right hon. and hon. Members on this bench. We have understood, too, what has been his aim and his strategy in the gradual unwinding of detention. We listened with great interest tonight to the very carefully weighed words with which, within the framework of that policy, to which we give general support, he nevertheless retained the freedom of action which in present circumstances he undoubtedly needs to possess. We noticed in particular that, should there be a reversal in this respect, the Secretary of State would consider himself in duty bound as far as possible to come back to the House.

    The Secretary of State has had the satisfaction during his 15 or 16 months in office of witnessing a gradual diminution in the statistical level of violence in Northern Ireland. One always has a certain hesitation in referring to these statistical changes when one knows that even greatly reduced figures cover such a world of tragedy and of crime. Nevertheless, it would be unrealistic not to take note both of the diminution in volume and of the change in character, a change in character which the Secretary of State himself denoted in a rather striking phrase—perhaps a slightly too striking phrase—when he called it "a new age of violence." But it is one of the characteristics of violence in Northern Ireland that it is Protean in its character and is constantly changing in its forms and emphases. That, all the same, ought not to prevent us from recognising the fact of the substantial and continuing general diminution.

    What has differentiated the last six months from the periods which have preceding them is undoubtedly that event which we unhappily describe by the name of "cease-fire". I say "unhappily" for it is not an appropriate expression to apply to a reduction in the number of criminal and violent acts. It is a term which is borrowed from an entirely different category of open and honourable warfare, and is already, when applied to the situation in Northern Ireland, a propaganda exercise which, even as we use the word, we ourselves tend to sustain.

    There is in the security situation in these last six months one important element which is missing, an element which this House and the Secretary of State can contribute to supplying. It is the hope of hon. Members on this bench that the debates of tonight and tomorrow will help towards that end.

    In the debate on the Spring Adjournment I pointed out that there was only one way in which it was possible, as things are now in Northern Ireland, for the full confidence of the public in government to be restored, and that was by open and candid debate upon the Floor of the House and by utterly frank dispelling of misunderstandings and resolution of problems. The Secretary of State knows very well—it is one of his difficulties—the atmosphere of rumour, suspicion, sometimes almost hysteria, which seems to sweep the scene in Northern Ireland and which constantly threatens the movement towards rationality and the restoration of normal conditions. This characteristic has entered upon a special phase in the past six months, since the beginning of the cease-fire, because nothing has yet dispelled the rooted belief that behind the so-called cease-fire there lies an agreement between Her Majesty's Government and the enemies of the State, of which the full details and some of the important conditions have not been disclosed.

    I am sure that there is no doubt about the main outlines of the policy which the Government have been pursuing. It has been the entirely rational policy of matching a real situation by a modification in the actions of the security forces. This is something which is entirely rational—indeed, to which there is no alternative—and the consequences of a diminution in violence can only be reaped gradually by the fact that the reactions to violence and the measures of the security forces can in proportion diminish and be relaxed.

    But against that background of an entirely rational policy there has persisted and been maintained the belief throughout the Province that there is something else, and that, in fact, like some of his predecessors, the right hon. Gentleman and Her Majesty's Government have entered into agreements, undisclosed, with the Provisional IRA and perhaps with other enemies of the State. It is in the interests of good government in Northern Ireland that tonight I want to take the opportunity to put to the Secretary of State in specific form some of the allegations which have sprung from that belief, because it is only if, on the Floor of this House, the Secretary of State can explode and deny them that we shall have the opportunity to begin to reduce the atmosphere of suspicion, which is only too easily understood amongst a population which has so repeatedly been disappointed and betrayed.

    So I proceed to put specifically certain statements to the right hon. Gentleman, statements which have been before the eyes of hundreds of thousands of ordinary people in Northern Ireland, and which they have understandably found it impossible not to take at face value. I know that he will realise the importance of dealing with them in the only way in which they can be dealt with—openly and frankly across the Floor of this House.

    I begin with the killing of the policeman in Londonderry in the second weekend of May. The statement was made following that by the Provisional IRA that that murder—these are its words—was
    "'a direct result of breaches in the truce over the past two weeks when two houses were raided by the Army and one by a squad of plain clothes RUC men.'"—[Official Report, 13th May, 1975; Vol. 892, c. 261.]
    There is no doubt what those words are intended to mean. Those words are forms of violence, on their part the Government have committed themselves to the Provisional IRA that so long as the Provisional IRA abstains from certain forms of violence on their part the Government will abstain from raiding houses by the Army or carrying out searches by RUC men in plain clothes.

    Both those activities are activities which are necessary for security, necessary for the detection of crime and for the prevention of further violence. So the public in Northern Ireland found itself confronted with a statement—admittedly a statement from enemy quarters—which appeared to carry upon the face of it the assertion that there was an undisclosed bargain not to enforce the law upon condition of certain forms of behaviour by the Provisional IRA.

    I turn now to a news item which appeared on 20th June 1975 in The Times.The Times of that date quoted a statement issued by the so-called Belfast brigade of the Provisional IRA after the publication of certain photographs, and it said that
    "According to Republican sources, tile photographs … are being regarded by the brigade staff as evidence that the Army's plain clothes intelligence patrols are continuing."
    The report quotes further from the statement that
    "'If Mr. Rees's travelling gunmen continue their undercover activity, the responsibility for a new situation is his.'"
    Once again the implication is perfectly clear. The IRA is stating—no doubt falsely but if it is false it ought to be said to be false on the Floor of this House—that as a quid pro quo the Government have committed themselves that perfectly lawful and perfectly proper missions on the part of the Armed Forces will be suspended and will not be carried out.

    I turn to a report in The Times the very next day, 21st June, referring to the debate which was to have taken place yesterday—but is more properly taking place here tonight—in that Convention which the Secretary of State earlier today described very correctly as "not a parliament". The report stated that
    "The controversial secret talks between senior British civil servants and leaders of Sinn Fein, which have played a crucial rôle in maintaining the cease-fire with the Provisional IRA, are to be debated for the first time next week."
    Well, they are being debated now, for I am asking the Secretary of State to say "yea" or "nay" to the allegation—it is a perfectly common allegation which appears in that item dated from Belfast—that
    "… secret talks between senior British civil servants and leaders of Sinn Fein…have played a crucial role in maintaining the cease-fire with the Provisional IRA …"
    In other words, the Provisional IRA has in part desisted from continuing its crimes because of what has been said to its representatives by servants of Her Majesty's Government.

    The last quotation which I offer, still from the same series and on 23rd June, is on the same point. It refers to
    "… the spirit of the cease-fire having been maintained—regularly assisted by long discussions between senior British civil servants and members of Provisional Sinn Fein, the political wing of the IRA."
    Have there been long discussions between senior British civil servants and the enemies of law and order and of the State in Northern Ireland? If there have, what have they been talking about for all those hours and on those repeated occasions? May the House of Commons be told what it is that has formed the subject of these long discussions and consultations?

    Civil servants are trained to say a great deal in a very short time. They are people who have the aptitude of using words so as to convey a precise meaning in one or two sentences. Why is it, if it is true at all, that these protracted discussions have to take place? What are they about? Are they discussing conditions made between Her Majesty's Government and the Provisional IRA of which this House has not been informed?

    That brings us back to the beginning of the so-called cease-fire itself and the announcement of 11th February with the setting up of the incident centres. I may not be quite as stupid as those who require several hours of coaching by senior civil servants to understand Her Majesty's Government's policy in Northern Ireland; but I must confess that I have still not fathomed the precise function of the incident centres.

    I might remind the House of the words in which they were described in the announcement of 11th February:
    "… if developments occur which seem to threaten the cease-fire, these incident centres will act as a point of contact in either direction."—[Official Report, 11th February 1975 Vol. 886, c. 208.]
    "Developments which seem to threaten the cease-fire", to you and me, Mr. Deputy Speaker, would seem to be renewed acts of violence. The only thing which, on the basis of what we have been told, threatens the cease-fire is that acts of violence are resumed. If a cease-fire is unconditional and if the Government, as they assert, are free in every respect to continue to carry out their duty of maintaining the law and the security of the population, the only thing which can threaten the cease-fire is that it is broken by those who perpetrate violence. But, then, if actions of violence are again perpetrated, what is the purpose of a point of contact "in either direction"?

    Very well. The Provisional IRA apparently rings up and its representative says "We did not do it." Well and good: they did not do it. In that case, nothing will happen to them. Is that the only point of these incident centres, to work "in either direction"? Clearly not. The only point of information passed "in either direction" is that there are reciprocal and mutual undertakings and that if Her Majesty's Government were under a misapprehension as to who was responsible for a breach of the peace, they themselves might inadvertently fail to fulfil some of the undisclosed conditions which they have undertaken towards these criminals.

    I find it impossible to reconcile what has been said so far about these incident centres with the policy of Her Majesty's Government as it is known. Not only I but the population at large in Northern Ireland find that reconciliation impossible. That was the reason why shortly after the debate on 13th May a perfectly absurd and irresponsible statement made by a reverend gentleman in Northern Ireland stirred up a whirlwind of speculation, of wild talk, of anxiety and of fear. That was a result of this background of unresolved suspicion that Her Majesty's Government have not fully disclosed the conditions which they made as a basis for the improvement in the level of violence in Northern Ireland.

    I believe in the candour of the right hon. Gentleman. Of course I do. I entirely believe in his candour. Indeed, if we could not believe in that there would be no purpose in the debate. But I say to him that a vital element today is missing in Northern Ireland which we can supply—and that is confidence, which at present does not exist, in the bona fides of the Government and in the openness of their dealing with both the public at large and the various enemies of the State in their different forms.

    I do not expect that in the ambit of this debate the Secretary of State will respond to the question which I have put to him. But I say to the Secretary of State that tonight and tomorrow he has an opportunity such as he has never had before—and he has it in the proper place—to dispel misunderstanding once and for all, to destroy unfounded rumours once and for all, to kill the lying whispers that civil servants are in constant conclave with the Provisional IRA, and to root out these causes of mistrust which not only delay all the developments which we want to see in Northern Ireland but are themselves a contributory cause to the continuing violence in this present phase.

    I ask the right lion. Gentleman to respond to the challenge in the spirit in which it is meant, and to do it before the end of the debate tomorrow.

    11.33 p.m.

    I cannot fully accept or follow the logic of the right hon. Member for Down, South (Mr. Powell). He opened his remarks by saying that he agreed with the legislation to be passed tonight and to a further extension of all the emergency powers legislation. I opposed that legislation at its inception, and at subsequent intervals when it became renewable I again voiced my opposition. But if the right hon. Gentleman agrees to the Secretary of State having all these powers under the emergency legislation he must realise that he is giving significant powers to the Secretary of State to use in whatever way he wants, without coming to the House and telling us, or making an excuse, or telling us what motivated him in employing them.

    If we do not give the Secretary of State such powers, we can retain them in some other way. But we cannot give him those powers and tell him to come to the House every time he uses any facets of the legislation involved.

    I agree with the right hon. Gentleman that there is suspicion, mistrust and fear in Northern Ireland about the so-called IRA cease-fire. But I agree from a different point of view. It appears that the British Government are prepared to accept a cease-fire in Northern Ireland provided that no members of the security forces are killed and that there is no aggressive action against the security forces. Aggressive actions against the security forces are called acts of terrorism, but when innocent people daily lose their lives we hear that there are gangsters afoot and criminal elements abroad. Members of the Provisional IRA who engage in war against the security forces are called terrorists, but anyone else who engages in sectarian violence is called a gangster or a criminal. In my view, anyone who engages in killing, whether it be the killing of a soldier, a policeman, a member of the UDR or an innocent civilian, is a terrorist.

    The Secretary of State rightly drew attention to the diminution of violence since the coming into operation of the IRA cease-fire, but there has been an increase in brutal and callous murders since the beginning of January this year. The Secretary of State told us that the Chief Constable of Northern Ireland has set up a force which will be concerned with the tracking down of sectarian murderers. It is rather late in the day for that. The Chief Constable should have been concentrating all his efforts on tracking down these murderers when they first started committing these crimes. Only last weekend three Catholics and and three Protestants were murdered.

    On the question of detention I am prepared to stand by my own logic. When detention or internment was first introduced it concerned people who were allegedly on the Republican side of the political fence. Even at that time some Opposition Members—notably the hon. Member for Antrim, North (Rev. Ian Paisley)—opposed internment or detention. Then there was a demand right across the political spectrum for the release of detainees. On the Loyalist side there were fewer detainees and consequently there were fewer to release. Now they are all released, so we do not hear objections to the continuation of detention emanating from the people who allegedly represent the Loyalist cause.

    The Secretary of State has coined the phrase that he will bring detention to an end when he is convinced that there is a sustained and genuine cessation of violence. When he first coined that phrase I asked him whether he was prepared to consider detention for those who were perpetrating acts of violence.

    The right hon. Member for Down, South concentrated on two alleged incidents—the killing of a young policeman in Derry and the killing of a soldier in Armagh. Everyone has cognisance of the killing of the young policeman in Derry because of the statements from the IRA which followed it. I regret those incidents and condemn those who are responsible for them.

    There are nearly 300 Republican prisoners in detention. Other people have been involved in violence throughout the period. The right hon. Member for Down, South referred to the statement issued by the Provisional IRA relating to the death of the young policeman in Derry. We could also have a list of statements which have emanated from the UVF relating to recent murders and pub explosions in Northern Ireland. The so-called Protestant Action Force has claimed responsibility for a number of recent murders.

    The Secretary of State said that it was hard to pinpoint these organisations, because they may be using phoney names or identities. I hope that he does not mean they do not exist. I believe that there is such a body as the Protestant Action Force, which has claimed responsibility for a number of murders. If the Secretary of State is prepared to keep continuing surveillance on the activities of the Provisional IRA, he should be prepared to pay equal attention to all those other so-called Loyalist groups which are engaged in violence.

    I oppose the order purely and simply on the ground of detention. I recognise that in a war situation, when lives are being taken needlessly, it is necessary for any Government to have some form of emergency legislation. Indeed, I am sure that every reasonable person in Northern Ireland would accept that. But I do not accept that in the present situation, with a diminution of violence being perpetrated by the IRA, there is any reason whatsoever for continuing with detention as it is in Northern Ireland.

    The Secretary of State cannot have it both ways. He said that he wants a sustained cessation of violence in Northern Ireland. But he will not get it. If he means that there has to be a week, a month or two months without any incidents, the Loyalist organisations can make certain of creating incidents and so ensure that no more detainees are released.

    Is it not a fact that during the period about which the hon. Gentleman is talking we have had a large measure of violence in Northern Ireland coming from some of the groups to which he has referred, and yet the Secretary of State has been releasing detainees? What brought a halt to the releases was the murder of the policeman in Derry. But now the releases have been resumed.

    I should like the Secretary of State to indicate whether he has a final date in mind for bringing detention to an end? If the cease-fire by the Provisional IRA continues for another one, two, three or four months, shall we see the complete rundown and end of detention in Northern Ireland?

    Detention is the main reason why there is still opposition to the emergency powers. Many people have relatives who have been interned. I could quote statement after statement made by hon. Gentlemen representing the Loyalist cause in Northern Ireland when there was internment without trial of Protestants. They should not be allowed to change their attitude to internment because there are now no Loyalists in detention and all those who are interned belong to one particular sect.

    11.43 p.m.

    I should not like to say anything which will make it more difficult for the Secretary of State and those responsible for the governing of Northern Ireland in this critical stage that we have reached, but some things needs to be said on behalf of the people of the Province. Unfortunately, the time is short and the hour is late—soon it will be early—and we have another order with which to deal. However, some points need to be underlined.

    First, we have had a serious law and order situation in Northern Ireland for some time. The people of Northern Ireland feel that both Governments—this legislation was brought in by the Conservative Government—have not acted with speed in this situation. We had the Diplock Report and, as a result of that report, the Northern Ireland (Emergency Provisions) Act 1973. That measure was hotly debated in Committee. The hon. Member for Belfast, West (Mr. Fitt) and members of the present administration in Northern Ireland were members of the committee along with myself. I think that there were 22 Divisions, and in all the Divisions which took place when I was present the hon. Gentleman voted against. That is the position according to the record that I have checked in the Library.

    It is most important for the record that the position is made clear as regards the parts of the legislation that deal with a variety of matters that we shall be discussing at a later stage. I hope the hon. Gentleman will not forget that on behalf of the then Opposition I made it abundantly clear that we supported detention in its amended form. I made it clear that the State could not sit back and let events take their course, and that we were not prepared to put the security forces at risk.

    Yes, but there was opposition in the Committee. It will be remembered that at that time there were elections taking place in Northern Ireland and that some of us were absent from the Committee. We were probably not present when the Committee dealt with the schedules. The Commissioners were appointed at that stage.

    I am not trying to make a political point; I am only pointing out that there was opposition. One would have thought that when the party which opposed that legislation came into power it would have moved with some speed. On the first occasion when renewal took place the Attorney-General gave a promise. The right hon. and learned Gentleman's statement of 9th July 1974 is available but I shall not quote it. The Attorney-General said that he would ask the House to allow the order to continue for a further six months. He gave the undertaking that the Gardiner Committee would make its report as quickly as possible. We know that the order was then renewed for a further six months. We are now renewing it for another six months.

    The point I am trying to make is that this is a matter of great urgency. The law and order situation in Northern Ire- land is serious. The people of Northern Ireland consider that there has been a dragging of feet on the part of both Governments. The hon. Member for Belfast, West, said that the police should have been on the job of trying to deal with the difficult situation that has arisen in Northern Ireland. It is not only a difficult but a dangerous situation. The acts that have been committed are of the most atrocious and abominable nature. I understand the fear that is felt in many sections of the community. They do not know when the travelling gunmen will strike.

    It should be said that the community that the hon. Gentleman represents is not in favour of the Royal Ulster Constabulary policing its areas. That attitude has caused difficulty for the RUC. It is difficult for the police to deal with the atrocities that take place in an area where they are not welcome and where they can be stoned and probably assaulted I am sure that the hon. Gentleman will agree that that is a difficult situation. In the present situation it would be a great thing if all public representatives joined together and backed the forces of the Crown, especially the RUC, in their efforts to deal with a tragedy. This is a very difficult matter, and the police have a difficult task. That needs to be stated.

    I trust that the new force or squad arranged by the RUC will be able to act effectively in all parts of Northern Ireland and will not be debarred by communities in Northern Ireland insisting that there should not be police in their areas. The Secretary of State wrote to me recently and pointed out that there were some areas in which normal policing was impossible. This resulted from the attitude of the community in those areas. That makes it difficult for the police to deal with a terrible and disastrous situation. This week I spoke to a high-ranking police officer who said that if everybody who had been shot at during the weekend had been killed, 15 people would have died over that weekend. That is a very serious matter.

    The second matter that disturbs me is that under the order the RUC has had a raw deal. Its members have been treated as terrorists and attempts are being made to bring them before courts dealing with terrorists and there has been a refusal by the courts to give them bail. Section 3 of the Act which we are being asked to renew says:
    "… a person … charged with a scheduled offence shall not be admitted to bail except by a judge of the High Court …".
    Subsection (5) provides for exemption to be made for members of Her Majesty's Forces, but there is no similar exemption for members of the RUC. Those members have been refused bail in magistrates' courts. It does not help the RUC to carry out its duties when it is treated differently from other members of Her Majesty's Forces.

    Furthermore, under these provisions members of the RUC can be refused trial by jury. This is a matter about which RUC members are most anxious. Could the Secretary of State when bringing in amending legislation give the members of the RUC the same rights as are accorded to members of Her Majesty's Forces to put them on a par in this legislation with members of Her Majesty's Forces? It seems unfair to me that a member of the RUC can find himself at a grave disadvantage in this respect.

    There are many other matters with which I should like to deal, but I must give the Secretary of State an opportunity to reply, and there are a number of other hon. Members who want to take part in the debate.

    I hope and pray that the situation in Northern Ireland will be dealt with effectively by the members of the RUC and by the new squad. Policing is effective only in the Protestant areas. A large number of those responsible for crimes are being brought before the courts, but they are being brought from areas where police are operating. What is the use of proscribing an organisation when no members of that organisation are being brought into court and charged with membership of that organisation?

    This is an important point. To prove membership is one of the most difficult things from a legal point of view. It is a matter which we should discuss in Committee.

    The Secretary of State will know that representations were made to the Gardiner Committee on this point—that if a person was asked if he was a member of an organisation and refused to answer, that should be taken as an acknowledgment that he was a member. There are people in detention who have publicly declared that they are members of the IRA. Why cannot they be brought before the courts? People are asking why these men are being released from detention and not being taken to court. There is an imbalance here. Those in Protestant areas are being prosecuted, while those in Republican areas are not being prosecuted. I see that the hon. Member for Belfast West takes the point I am trying to make.

    I have had some very hot disagreements with the Secretary of State, but we realise the seriousness of the situation, and I hope that when he replies we shall hear what has taken place between the Government and Provisional Sinn Fein and the Provisional IRA. The people of Northern Ireland are sick of seeing a member of the brigade staff of the Provisional IRA, Mr. Loughrin, on television making statements that he is in touch with high-ranking civil servants at Stormont and that he is having conversations with them. I appeared on television with Mr. Devlin, a colleague of the hon. Member for Belfast, West, and this member of the brigade staff sat opposite us. He informed us—two elected representatives—that he was having conversations with civil servants in the Secretary of State's office. That cannot be tolerated in the present situation in Northern Ireland.

    11.57 p.m.

    The House will endorse the plea of the hon. Member for Antrim, North (Rev. Ian Paisley) for a strengthening of the RUC's rôle in relation to the kind of violence the cease-fire has highlighted, but the House will be surprised that the right hon. Member for Down, South (Mr. Powell) did not seem to welcome or accept the existence of the cease-fire and the degree to which it has led to a reduction of one type of violence. It is right that the House should probe the price, if any, paid for that cease-fire, but the conduct of Ministers is a better guide to that price than the braggings of members of an organisation linked to the Provisional IRA whom one would not be inclined to believe in other circum- stances. I do not see why we should give any greater credence to remarks made by them on television.

    Some of the points put to the Secretary of State have already been answered in statements, but he may need to reiterate them tonight.

    I and my colleagues in the Liberal Party have always detested internment, and I am sure the Secretary of State is not exempt from that feeling. We have always regarded it as a propaganda weapon for the IRA, and the IRA has successfully used it as such in the minority community. I would not accept renewal of the emergency powers if I did not recognise that steps were being taken to reduce the reliance on detention and to use the courts as a means of bringing people to justice.

    I have reservations about the Bill which will be debated tomorrow, but against the background of the Government's clear determination to move away from detention, and the major features of the Gardiner Report and the way that the Government are to proceed with them, I shall not seek to oppose the renewal of the emergency provisions. Against the background of the need to provide stability within which the Convention can hold its discussions, and the background of the intention to attempt to move to United Kingdom standards of law and order, we would be wrong to do so.

    One feature of the Gardiner recommendations concerned convicted persons escaping from arrest. It was recommended that the offence committed by these people should be added to the list of scheduled offences. The question of escape does not seem to be covered by tomorrow's provisions, and the right hon. Gentleman did not mention the matter tonight. We should be grateful if he would deal with the question of convicted persons escaping and of others helping them to escape in view of the scale of that activity.

    Proscription does not appear to be even-handed. I recognise the difficulties to which the Minister has referred, the problems of proving membership. The existence of those problems has not prevented us from retaining a situation in which one section of those involved in violence has been subject to proscription while others, also conspicuously involved in violence, have not. That does not present the situation of even-handedness with which the Minister has sought to justify the use of proscription, and it does not augur well for the acceptance by the minority in the community of such things as the writ of the RUC. The Minister cannot leave this situation where he has sought to leave it.

    Several hon. Members rose——

    12.3 a.m.

    In view of the time, I must now reply to the debate. I know that other hon. Members wanted to take part and have been prevented by the time factor. That is in the nature of these one and a half-hour debates. I hope that those hon. Members will have the opportunity to speak tomorrow in the debate, when we shall cover a great deal more ground.

    The tone and attitude of the speech by the hon. Member for Berwick-upon-Tweed (Mr. Beith) coincides very much with my own. He said that he is against detention and that our policy is for ending it. During the existence of the Assembly last year, and about a fortnight after I took office, I was in Royal Avenue, Belfast. I met the hon. Member for Antrim, North (Mr. Paisley) and the then Chief Executive there. The centre of Belfast was burning and the people of the city were shouting demands for something to be done to stop their city burning.

    I could not act through the police and I could not act through the courts. To have stood back in the face of what was happening and to have done nothing would have been wrong. Governments face dilemmas in seeking to deal with urban guerrilla warfare, with brigades, battalions, intelligence officers and so on. It is not easy to take the view that since the matter cannot be taken through the courts it would be better to do nothing. In those circumstances the situation would simply deteriorate even further.

    I would prefer to leave the hon. Member's point about the Gardiner recommendations concerning escaping persons until tomorrow, because we are specifically not dealing with that matter tonight. There are difficulties about proscription. The list of proscribed Republican organisations contains a number of youth and women's groups. Although at first glance the list appears to be lop-sided, this is not the case.

    The hon. Members for Antrim, North and Epping Forest (Mr. Biggs-Davison) spoke of the time taken to deal with the report. We received the Gardiner Report at the end of last year. Translating that into legislation after full discussions with the security forces and the lawyers was a long job. It would have been foolish, given the complaints about the Diplock arrangements, to have gone haphazardly into legislation. It takes time. That is why the Bill comes up tomorrow.

    I was making the point that we might, perhaps, have had a general debate on the report rather than on the legislation.

    I think that I offered that in the Northern Ireland Committee but it was thought that the debate should not take place. I do not press the point. It could have been done in Committee had that been required.

    The special category status is an administrative status. I shall have something to say about it tomorrow, and about prison accommodation generally. If on the first day that I took office I had set about building prisons we would not have been able to use them until the end of this year. It takes time. After the Cunningham Report in 1971 no action was taken. In that sense I inherited a situation. I will give details tomorrow of the new accommodation that is coming later in the year.

    I come now to the rôle of the Army, particularly in dealing with explosives. From the advice I am given, in the cease-fire situation, whatever complaints there are, it is unlikely that explosives are hanging about. When explosives move into an area it is a sign that something is about to happen. They do not keep. It is not surprising that the amount of explosives found has fallen. Some of it was old explosive material, found in empty houses. When the scent of explosives is around we know that something is about to happen two or three days later.

    I am glad that the right hon. Member for Down, South (Mr. Powell) comprehended what I have tried to do over the past 15 or 16 months, particularly with detention and the new type of violence. He dealt, quite properly, with the ceasefire. On 14th January, 11th February and 12th March and other occasions I have reported to the House on the nature of the talks with the Sinn Fein. I have carefully made sure that everything that has been discussed or explained has been reported to the House. In the first report on 14th January I talked about "a lasting peace". I mentioned what could happen if there was a permanent cessation of violence. I said that the Army could make:
    "a planned, orderly and progressive reduction".
    I said that there could be no time scale and added:
    "I shall have to be convinced that any relaxation and reduction of Army activity will not have to be paid for in lives lost and property destroyed. Once I am so convinced … in the later stages of this response to a permanent cessation of violence, the Army could he reduced to a peace-time level."—[Official Report, 14th January, 1975; Vol. 884, c. 201–2.]
    On 11th February I spoke on the same point, about the reduction in the rôle of the Army, both in numbers and in scale of activity. I said that once I was satisfied that violence had come to an end there would be a de-escalation of searchings by the Army in certain areas. Such activity was required only in the face of bombings and so on. I made it clear that the searches in every house and the counting of heads would not be required in those circumstances. It is not required in this situation. That is not to say that the Army are not there, that there are not vehicle check points, that people picked up or wanted in the courts are not dealt with.

    As I explained to the House, and it is worth saying again, I do not want there to be any illusion. I have stuck clearly to what I have said in the House of Commons. My officials have had meetings with various organisations to follow up the statements made to the House and the publication of the Gardiner Report.

    There have been a number of meetings with. Provisional Sinn Fein. I want to be sure that Government policy is clearly understood, and it would be wrong if there were no chance for Government views to be explained and clarified fully. There is no question of bartering the future of Northern Ireland away. I recall my words:
    "My officials have been under instructions to expound the Government's policy and to outline and discuss the arrangements that might be made to ensure that any cease-fire did not break down."—[Official Report, 11th February, 1975; Vol. 886, c. 207.]
    I have said that explanations have been given to the meetings. I have carefully reported to the House all that goes on and all that has been done.

    In that case, can we take it that there have been no meetings since the meetings when these matters were explained at the time when the cease-fire came into force? Once explained, they did not need to go on being explained hour after hour, did they?

    Discussions go on with the Protestant para-military groups and they discuss the Government view of the situation.

    It is not. It may be that the right hon. Member for Down, South does not understand the Irish mentality. At least, after 15 months I begin to comprehend it. It is different and needs explanation.

    There are no arrangements for bartering away Northern Ireland. Policing is important. The cease-fire is not a truce. The fact that there has been a cease-fire since the turn of the year has been the main momentum which could flower and develop. It is vitally important to Northern Ireland that the Provisional IRA has had a cease-fire, and I welcome it. I hope that it will develop, because it is the only way, at the end of the day, in which we shall get peace in Northern Ireland.

    My hon. Friend the Member for Belfast, West (Mr. Fitt) made a point about intention. It is no good arguing that in one part of Belfast there is use of this Act and in another there is not. If the police are not there, there is no other way of making arrests. Unless the police have the evidence to go through the courts, the alternative is to sit back. There is a dilemma, and that is the reason why there is a smaller number of Loyalists than Republican detainees. That is the nature of the situation. It is clear. It may not be pleasant, but it is true.

    With regard to policing in general, all I can say is that in Northern Ireland this legislation will not be necessary in the long run if we get genuine policing. That is the Government's aim. The Army have done an excellent job.

    Will my right hon Friend agree that the vast majority of recent murders have been not in Republican areas but in other areas?

    If my hon. Friend is saying that in recent months most sectarian murders have been from Loyalist sources he is right. Hon. Members from Northern Ireland have admitted and said so. That is a fact. However, it does not mean that by the nature of sectarian murder there is a lack of policing. The matter is difficult. Policing matters.

    It being one and a half hours after the commencement of proceedings on, the motion, Mr. Speaker put the Question, pursuant to Standing Order No. 3 ( Exempted Business).

    Question agreed to.


    That the Northern Ireland (Various Emergency Provisions) (Continuance) Order 1975, a draft of which was laid before this House on 9th June, be approved.

    Northern Ireland Act 1974 (Extension)

    12.15 a.m.

    I beg to move

    That the Northern Ireland Act 1974 (Interim Period Extension) Order 1975, a draft of which was laid before this House on 9th June, be approved.
    Just over one year ago traumatic events in Northern Ireland led to the ending of the five-month old Executive and a return to direct rule of Northern Ireland from Westminster. That represented the end of a bold experiment in partnership between the two communities there and the recognition on the part of the Government that a more acceptable and durable approach might best come from the people of Northern Ireland themselves.

    Parliament then enacted the Northern Ireland Act 1974, which provided for the election of a Constitutional Convention to consider and report on
    "what provision for the government of Northern Ireland is likely to command the most widespread acceptance throughout the community there".
    Elections to the Convention were held on 1st May 1975, and the deliberations of the Convention are currently in progress. Meanwhile direct rule continues.

    The Northern Ireland Act 1974, as well as providing for the election of the Convention, made new temporary provisions for the government of Northern Ireland. These provisions were to have effect initially for an interim period of one year, which comes to an end on 16th July 1975. The Act allows for this interim period to be extended for up to one year at a time, subject to the approval of each House of Parliament. The purpose of the present draft order is to extend the interim period until 16th July 1976.

    Hon. Members may like me to refresh their memories about the nature of these temporary provisions. Briefly, the Northern Ireland Act 1974 provided for the reintroduction of direct rule. It enabled legislation for Northern Ireland to be made by way of Order-in-Council at Westminster instead of by measure of the Assembly, and it made provision for the functions of the members of the Northern Ireland Executive to be discharged by Northern Ireland Departments subject to the direction and control of the Secretary of State.

    As well as retaining direct responsibility for those matters which, under the Northern Ireland Constitution Act 1973, were placed in the hands of Her Majesty's Government, notably the administration of law and order, I therefore became responsible to Parliament for the time being for transferred matters as well, including legislation on such matters as were formerly the responsibility of the Northern Ireland Executive, and for which the Executive was accountable to the Assembly.

    I and my colleagues exercise these responsibilities continuously whether in Northern Ireland or in London. To help us do so, there is machienry in Northern Ireland to help us co-ordinate the work of the different Departments. For instance, there is an executive committee, which meets regularly under my chairmanship and consists of my ministerial colleagues and the permanent heads of the Northern Ireland Departments. This committee oversees the general administration of transferred services and also considers proposals for legislation. The Secretary of State's Executive Committee, SOSEC, meets regularly and is a co-ordinating body, similar to an executive or a Cabinet because of devolved forms of Government still taking place.

    As far as excepted and reserves matters are concerned, I have direct personal responsibility for constitutional matters, security and law and order. My right hon. Friend the Minister of State, the hon. Member for Salford, West (Mr. Orme), acts as my deputy with special concern for political affairs and coordination of EEC business. My hon. Friend the Minister of State, the hon. Member for Lewisham, East (Mr. Moyle) has special concern for the police. My hon. Friend the Under-Secretary, the hon. Member for Mansfield (Mr. Concannon) has special concern for the Army. Lord Donaldson, the Under-Secretary, has special concern for prison administration and compensation.

    As to transferred services, I take a close personal interest in overall social and economic planning for Northern Ireland, while first-line responsibility for the various Northern Ireland Departments is divided among my four colleagues. My right hon. Friend the Member for Salford, West oversees the Departments of Commerce and Manpower Services. My hon. Friend the Member for Lewisham, East has responsibility for the Departments of Education and Health and Social Services. My hon. Friend the Member for Mansfield oversees the Departments of Environment and Housing, Local Government and Planning. Lord Donaldson takes charge of the Departments of Finance and Agriculture.

    The House will understand that this wide range of responsibilities places a very heavy load on all my colleagues. It is a matter of great personal satisfaction to me that they continue to discharge their duties with commendable energy and skill, in what the House will appreciate are not the easiest of conditions, on seven days a week over parts of the Province. Some of the remarks that have been made recently have shown a complete lack of knowledge of the form of government that takes place in the Province.

    In the economic field, the Department of Commerce has concentrated on maintaining the momentum of the job-creating industrial development programme and minimising, where possible, the impact on existing industry and employment of the effects of the general recession, from which Northern Ireland has not, of course, been insulated. The Department's efforts to attract new industry and to encourage the expansion of existing firms has resulted in the promotion of almost 5,000 new jobs. This has involved Government assistance of about £26 million in a total of some 39 firms.

    Northern Ireland has more of a mixed economy than the rest of Great Britain. It has become more and more mixed over the years, and if it were not for the money put in by the Government there would be sizeable unemployment:. We have had a sort of "National Enterprise Board", I am glad to say, because it was set up by the previous administration. We could build upon that in relation to the NEB for the United Kingdom as a whole.

    I am grateful for that correction. It was set up in those days.

    Special efforts have also been made to foster small-scale business enterprises. Indeed, a major decision has been announced to assist Harland and Wolff Ltd. through its present financial difficulties. This involves taking the company into public ownership, and discussions are progressing on the introduction of worker participation at all levels of decision-making within the yard.

    The responsibilities of the Department of Manpower Services include a comprehensive range of training and rehabilitation resources. In the year ended 31st March 1975 the total output of Govern- ment training centres amounted to just under 3,400 adults and apprentices, excluding 865 others who completed their training elsewhere under arrangements made by the Department. In addition, under the Counter-redundancy Training Scheme 14 firms provided approved versatility training for 740 employees who would otherwise have been redundant in periods of temporary recession. Thirteen hundred others were provided with both employment and training under the auspices of Enterprise Ulster. The Fair Employment Bill has been published, and there is legislation in prospect on sex discrimination and industrial relations.

    I should add about training generally that training facilities in Northern Ireland, in both content and amount, are facilities of which people there should be proud and which we would do well to emulate in the rest of the United Kingdom.

    Turning to environmental matters, a variety of measures are in hand to alleviate the seriousness of the housing problem in Northern Ireland. For instance, steps are being taken to stimulate the growth of the voluntary housing movement. The maximum limits on improvement and standard grants have been raised, and in the public sector a rent rebate scheme has been introduced. All areas in Belfast which are scheduled for re-development or comprehensive development will be taken into public ownership by 1980. Other major developments include publication of a discussion paper on regional physical development strategy and the commissioning of a major review of the Belfast Transportation Plan. Under the auspices of the Department of Environment, £2 million has been spent by local authorities and employment given to over 1,000 men on cleaning up areas affected by civil disorders. Only those who know Northern Ireland know the importance of that. In downtown Belfast the need for a clean-up brings to mind the Forth Bridge—as much as is done, there are still areas in which there are very real problems.

    As for education, the five new education and library boards have now been in operation for just over 18 months, and the reorganisation has been achieved without major disruption and in a way which has allowed the continued develop- ment of the services for which the boards are responsible.

    In secondary education, a feasibility study is being carried out by the Department's senior chief inspector, following the recommendation of the Burges Report that the 11-plus procedure should be eliminated through a re-structuring of the education system. The study, which should be completed within a year, is concerned not with theoretical arguments for and against reorganisation but with the practical possibilities of achieving it within the resources of existing buildings and in the light of local circumstances. My hon. Friend the Member for Lewisham, East the Minister of State, who is responsible here, is talking with the education bodies about the practical problems of ending the 11-plus.

    Over the past 12 months there have also been important developments in community relations. The amalgamation of the Department of Community Relations and Education will allow an integrated approach to these inter-related areas of activity.

    I am glad to report that the last 12 months have been an encouraging period for the work of the Department of Health and Social Services. Not only is there now full integration of the health services but, uniquely in the United Kingdom, these have been linked with personal social services under single authorities, the four new health and social services boards. This approach will, I believe, pay particular dividends in the provision of services for the total needs of groups like the elderly and the physically and mentally handicapped.

    For the agricultural industry, the past year has been a problematical one in the United Kingdom as a whole, but particularly in Northern Ireland, which is more dependent on the products which encounter the greatest difficulties; namely pigs, eggs and beef. Different reference rates for the "green pound" for the United Kingdom and the Irish Republic were introduced on 7th October 1974. These different rates placed meat processing in the Republic at an advantage over the meat plants and bacon factories in Northern Ireland, and tended to encourage smuggling of livestock to the Irish Republic and a resultant loss in throughput and employment in processing plants in Northern Ireland. However, I am pleased to say that, with the help of my right hon. Friend the Minister of Agriculture, I was able to take action to neutralise the effect of the differential and provide real assistance to the industry in Northern Ireland.

    The Department of Finance, apart from maintaining the financial machinery of government in Northern Ireland, has continued to press ahead with the Government construction programme in spite of the troubles and difficulties about the supply of materials. As well as carrying out a programme of building on behalf of Northern Ireland Departments and of work for the Post Office, the Department has borne a heavy load of work on behalf of the Northern Ireland Office in respect of prisons.

    I hope that this brief survey of the work of the Northern Ireland Departments will have given the House a fuller understanding of the range of activities with which my colleagues and I are concerned in the administration of transferred services in Northern Ireland. I only wish that the work of these Departments could be discussed in the Northern Ireland Committee. There is not a devolved form of government. The Ministers who work with me are about their business every day of the week, but only on this occasion, when I list the work done, is there any mention of it in the House. The Northern Ireland Committee was constructed for that purpose, and I believe that the fact that there has been no use of it is bad for Northern Ireland. Such a survey would not be complete without a mention of the extremely hard work and devotion of the Northern Ireland Civil Service, many of whose members are working under extremely difficult conditions.

    I turn again to the order. One of the main reasons why it is required is that it would not be right to introduce any fresh arrangements for the government of Northern Ireland while the Constitutional Convention is at work. The purpose of the Convention is clear and specific. The Convention is not a Parliament, and its members are not Members of Parliament. The Convention's sole task is to make recommendations to Parliament at Westminster about the future arrangements for government in Northern Iraland. The Government take the view that it is for the people of Northern Ireland, through their elected representatives, to take the lead in shaping together their future institutions of government.

    The House will understand why it would be inappropriate for me to assess the Convention's progress to date. Although the Government will assist the Convention in any way they can, they will not interfere in the Convention's work. I would say, however, that the Government welcome the constructive way in which the Convention, under its Chairman, Sir Robert Lowry, to whom I am pleased to pay tribute on this matter and many others, has settled to its task.

    As the House knows, the Convention agreed its rules of procedure in early June and is now addressing itself to its main business. The initial span for the Convention's life is six months, but the Government would sympathetically consider extending this period, provision for which was made in the Northern Ireland Act.

    Whatever the outcome of the Convention, the government of Northern Ireland has to be carried on. The draft order does no more than allow that to happen. For the time being there is no practical alternative to the present arrangements, and I hope that the House will, therefore, accept the need to approve the draft order.

    12.30 a.m.

    We are a little puzzled by the mention by the Secretary of State of the Northern Ireland Committee, because at Business questions on successive Thursdays we have been pressing the Leader of the House fur the Northern Ireland Committee to be used. It is no fault of the Opposition that the Northern Ireland Committee has never met. Of course, we agree——

    May I ask the hon. Gentleman whether we can call the Northern Ireland Committee to discuss education, industry, and all the other issues that are being advanced? I should be very happy to arrange it with the Northern Ireland Members and to start next week.

    I think we have heard that suggestion with great sympathy, and, although I am the last person to be a "usual channel" I certainly see no reason why the Northern Ireland Committee, which has never met, should not meet and do some useful work.

    Of course, we agree with the Secretary of State that the government of Northern Ireland must be carried on. The existing system must continue while the Constitutional Convention is preparing something else, and, I trust, something better. We pray for the success of the Convention, and we acknowledge the conciliatory speeches and the constructive attitude of Unionists and non-Unionists alike in the Convention. This is something which has already been admirably demonstrated in a number of district councils and other public bodies.

    As I understand the position, the Convention operates under a different time-scale from the Northern Ireland Assembly. Under article 3 of the order the Assembly is to continue in suspended animation for another year, until 16th July 1976. The Convention, for its part, is subject to automatic dissolution either on the date of the presentation to Parliament of its final report or six months after its first meeting, whichever comes first, unless the Secretary of State extends the duration of the Convention for up to three months at a time.

    I think that we all hope that the Convention will report without great delay, but were its deliberations to be prolonged through next year—I hope this is an academic question—could the interim period laid down in Section 1(4) of the Northern Ireland Act 1974 be again extended or would new legislation be necessary?

    The system of direct rule is not satisfactory. Under it administration and government have become more remote and impersonal. The too few right hon. and hon. Gentlemen who represent Northern Ireland—Fermanagh and South Tyrone is almost as disfranchised as Walsall, North—have their work cut out in dealing with the grievances and problems of their people in these days of bloodshed, disruption and distress. Ministers work extremely hard. The Secretary of State has described a little of how they operate.

    I single out one point that the right hon. Gentleman made, concerning the training schemes. In Northern Ireland these are excellent and are of particular importance at this moment. But there has been a burgeoning of bureaucracy. It is not the fault of Ministers, and it is not the fault of the Northern Ireland Civil Service, which has a very high reputation indeed. The centralisation of local government under the Macrory reforms has led to an increase of some 10,000 officers. Yet. although the old paraphernalia of Governor, Privy Council, Senate and House of Commons has been criticised as being out of all proportion, under direct rule civil administration has been more costly and more bureaucratic.

    At the moment, of course, all this is for the Convention, and on the Convention our hopes rest.

    12.35 a.m.

    I endorse the very modest remarks which the Secretary of State understandably made about the efficiency and the hard work put in by his ministerial team. We all admire and appreciate the amount of work that they do, and we also appreciate the intolerable strain under which the right hon. Gentleman and his colleagues operate in what is probably the most difficult of all the Offices of State, the Northern Ireland Office.

    Perhaps I might reciprocate and mention the right hon. Gentleman's remarks about Northern Ireland's advancement in various ways. I have said on several occasions that in health and social services, especially in terms of hospitals, Northern Ireland was very often 10 years ahead of the rest of the United Kingdom, and that development took place when Northern Ireland was, to a great extent, nearly completely financially self-supporting.

    There was another experiment. Back in the 1930s, a Unionist Government attempted the nationalisation of road transport. It was not sabotaged by any political party or group. The scheme virtually wrecked itself. I should have though that that might have been sufficient warning to the Labour Party when in 1945 it embarked ill-advisedly on a similar course.

    I share the view of my right hon. and hon. Friends that these debates and the debate tomorrow are in the reverse order: much time might have been saved and a far more orderly debate might have ensued if we had been able to take the Bill first and the orders subsequently.

    Much has been made of the point that Northern Ireland gets a disproportionate amount of Parliament's time. But whose fault is that? It is the fault of the 483 Members of this House who, on 28th March 1972, voted enthusiastically for the abolition of the Parliament of Northern Ireland. They said that it would break the mould, it would lead to fresh thinking, it would give time for reflection, and the rest of it. As the Bill moved through its various stages, their enthusiasm diminished somewhat, and the number in favour has decreased as successive Secretaries of State have come to the House to ask for another renewal or to conduct another experiment.

    It is well to remind the House of the reason for its having to bear the burden which so many Members at the time assumed willingly. The Northern Ireland Members themselves cannot be blamed. They warned of the consequences of many of these hasty decisions.

    In their innocence, many right hon. and hon. Members have often talked about temporary provisions. We see the phrase featured on the front page of the document which we are discussing now. We have talked about temporary provisions for four years. Right hon. and hon. Members have consoled themselves with the notion "Here is yet another experiment that we might try", and they have followed that with the exhortation "We may have our doubts about it, but let us give it a try." I remember my right hon. Friend the Member for Down, South (Mr. Powell) saying in 1972 that Members were not here to give this or that a try but were here to exercise their judgment. A great many of our colleagues in the House at that time—many of them are still here—were sad at that. Despite the fact that our advice on these constitutional matters have been disregarded so often, we offered our cooperation in making the machinery work—with about as much result and response from those in authority.

    In the face of the complaint that Northern Ireland was receiving more than its share of parliamentary time, my right hon. Friend and I suggested on several occasions that in the case of Bills which would afterwards be copied and duplicated in Northern Ireland, the sensible procedure would be to include an application clause in them extending them to Northern Ireland. What was the answer? The answer was that the Government did not think that appropriate.

    After the setting up of the Northern Ireland Committee we took the initiative on 13th February. On that day I wrote to the Leader of the House suggesting that as that Committee had now been brought into being we should ask for an early sitting to discuss the very subject which we are now debating—months afterwards. On 17th February the Leader of the House replied through his secretary acknowledging the letter and saying that they would get around to dealing with it. On 26th February I received a further letter from the Leader of the House saying that he thought that if I could agree this with the Northern Ireland Office the Government might be able to take action. But no such agreement was ever achieved. We were never given any reason why this was not considered a suitable subject for discussion in the Northern Ireland Committee. I am sorry that I must correct the Secretary of State on this matter. His memory must be at fault. At no time did he ever suggest that the Gardiner Report was a subject for discussion in the Northern Ireland Committee.

    On a point of order, Mr. Deputy Speaker. In view of the fact that the Government have lost the Woolwich, West by-election and thereby——