Skip to main content

Orders Of The Day

Volume 990: debated on Monday 4 August 1980

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

Consolidated Fund (Appropriation) (No 2) Bill

Order for Second Reading read.

Motion made and Question proposed, That the Bill be now read a Second Time.—[ Mr. Wakehatn.]

On a point of order, Mr. Deputy Speaker. I am sorry to delay the proceedings of the House, but, despite what the Leader of the House has said, I hope that there will be a debate on the paper and board industry tomorrow morning. I wish to establish whether it is within your power, Mr. Deputy Speaker, to ensure that a Minister other than a Minister from the Department of Industry will reply on behalf of the Government. Much of the debate will depend on energy subsidies and the Government's energy pricing strategy. If a Department of Industry brief is to be read in response to the debate, it must be in order for a Minister from the Department of Energy to read that brief and to take interventions from the Floor about the Government's energy pricing strategy. Will you raise that issue with the Leader of the House, Mr. Deputy Speaker?

The topic is to be discussed in due course. Which Minister answers a debate is not a matter for the Chair. I am sure that the hon. Gentleman's point will be noted.

Motor Industry

9.2 pm

I am grateful for the opportunity to discuss the motor industry and to draw attention to the fact that world-wide the industry is in recession, with one significant exception—Japan. In the first half of 1980 Japan put 3 million cars on the world's roads. Last month, in a drastically reduced home market, the Japanese sold more cars than British Leyland, but we still rely on a gentleman's agreement to contain these soaring imports. We play the trade game according to the rules of croquet, whereas the Japanese practise judo world-wide.

Following Japanese exports of 1·7 million cars into America, 300,000 American car workers were sacked or laid off. That led the American Government not only to give direct financial help to Chrysler but to try to give its car manufacturers a breathing space to retool for smaller models by the introduction of a new industry policy. That seeks to force Britain and other European trading nations to absorb the excess of Japanese cars which is troubling the American market. Later, I have no doubt, we shall be expected to absorb the new smaller models from the American plants.

In France, Citroen shut down production for seven days. French Talbot declared longer than usual breaks at Christmas and the new year and closed its plants for six days in the first four months of 1980. Its workers are now on short time, as are the workers in the French Ford plants. The French Government have told the Japanese bluntly that the car industry is too important to the economy to allow the present position to continue.

Fiat in Italy has announced that 78,000 of 114,000 workers are to be laid off. Even in Germany 4,000 workers have been sacked by Opel. There is also short-time working at Ford's in Germany, as there is at Volvo in Holland and for the bulk of the 32,000 car workers in Spain.

In Britain 18,500 jobs have gone from British Leyland with more to come at Canley in Coventry and in the body shops at Swindon following the pending closure of MG and the slump of its potential rescuers, Aston Martin, which is sacking one-fifth of its work force. That seems to be the fate of more than one rescuer. Armstrong Equipment, which tried to rescue the Meriden motor-cycle business, is chopping 1,500 jobs from its labour force of 6,500. In West Bromwich the old Jensen plant is now the United Kingdom base for the Japanese Subaru. British Talbot has sacked 2,500 workers. Another plant in Coventry is almost completely dependent on a contract from Iran.

I am glad that my hon. Friend has mentioned the contract that Talbot has with Iran. Can he tell the House that the existence of Talbot in Coventry, and probably Talbot in this country, depends upon the implementation of that contract with Iran, which is held primarily by the factories in Coventry?

I am grateful for that intervention. There is no doubt that the livelihoods and jobs of those in the Stoke works in Coventry are perched on a knife-edge. It cannot be reassuring for them to know that their livelihood depends on events in Iran.

The previous Government had to give the factory temporary employment subsidy to help it over a difficulty and there are now doubts about the future of the other Talbot plant near Coventry because of the situation in France that I have outlined.

Every week there are announcements of sackings and layoffs, but none of that is news to the Government. In his capacity as president of the Committee of Common Market Automobile Constructors, Sir Michael Edwardes wrote to Commissioner Davignon on 27 June and to member Governments spelling out the degree of Japanese penetration and the fact that it was largely due to the depreciation of the yen by nearly 20 per cent. over the past 18 months. The letter also expressed doubt whether the present market situation came within the GATT. I hope that the Minister will touch on that aspect in his reply.

The pressure in Britain is greater than elsewhere, largely because of three abnormal factors in our economy that were referred to in the previous debate and in Question Time earlier today—the strong pound, the steep increase in the rate of inflation, and high interest rates.

The rate of exchange normally reflects the general state of a country's industrial wealth. If industry is not performing well, the currency weakens. The cost of imported goods rises—protecting the domestic industry—and the price of exports goes down, making it easier to sell abroad. If the currency strengthens, imports become cheaper and export prices rise.

North Seal oil has distorted that situation and our rate of exchange does not properly reflect the state of British industry. That has meant a savage reduction in profit margins on exports. Vehicles are having to be sold at a loss, as in the case of MG, because if prices are raised the goods are no longer competitive.

In the Government's ideological haste to distance themselves from involvement with industry and their inability or unwillingness to manage the exchange rate for the pound, they are not putting the temporary bonus of North Sea oil to work to regenerate our industry.

Britain has become the most profitable market for any foreign manufacturer. In a period of one year, the profits for Italian imports into Britain have gone up by one-half, the profits for France and Germany have doubled, and those for Japan have quadrupled. Our trade in complete motor vehicles is out of balance.

When selective import controls are mentioned, as they were in the previous debate, the Government express fears about retaliation. They should consider the fact that in 1979 we imported 720,000 vehicles from the EEC and exported 140,000; we imported 199,000 from Japan and exported 2,500; we imported 39,000 from Eastern Europe and exported 400; and we imported 50,000 from Spain and exported 300. How much retaliation can be exerted on those figures?

In present circumstances, apparently it is profitable for Citroen to establish a marketing office in Leamington for its machine tools, transfer lines and specialised motor industry equipment. It has already sold equipment to the Ford tractor plant at Basildon and currently is quoting for BL equipment. This points to the increasing tendency of the British machine tool industry to act as agent, rather than as manufacturer. However, that may be the subject of a debate on another day.

Any Government must seek to keep inflation under control, but no Government should be actively promoting recession. No Government, especially one who deliberately increased inflation within weeks of taking office, should consider that any remedy is justified. No Government should use unemployment as an instrument of policy.

Inflation means that a manufacturer in Britain buying his raw materials here pays more for them than his counterpart in other industrial countries. But the accusation often made by the Prime Minister that workers are creating unemployment by excessive wage demands cannot be levelled at the 160,000 employees of BL who settled for a basic 5 per cent. increase for 1980 and who achieved a record of 98 per cent. of available man hours free of strikes or disruptions in the first half of 1980.

In the debate on the West Midlands on 20 June, the Minister of State, Department of Industry, admitted that interest rates, inflation and the high level of the pound were the immediate causes of industry's current problems. But he went on to repeat the parrot cry that we hear from Minister after Minister "You are not sufficiently competitive". With the thousands of people shed in the past year, the reason can hardly be overmanning. I think that it is more a question of better facilities and more funds for research and development.

The hon. Member speaks of facilities and increased investment. Does he not agree that some, though not all, of those who have been made redundant find themselves redundant because of the introduction of investment for robotics and machine-assisted ways of production? Unless BL and other companies modernise in this way, with the absolute concomitant that some labour will have to be shed, BL will not succeed.

I do not disagree. But, that having been said, the hon. Member for Oxford (Mr. Patten) has to go a stage further. He has to accept that by introducing new methods of production, by introducing robots, as has been done on the Metro line, and by being able to achieve the same level or an even higher level of production with less labour, either we have to aim for a greater share of the market to maintain a greater labour force or we have to look at the other aspects to which the trade union movement has made reference many times—those of a shorter working week and trying to line up our holidays with those enjoyed on the Continent. At present, our wage levels are considerably lower than they are on the Continent. Therefore, although I accept what the hon. Gentleman said, I urge him to look at the other side of the coin as well.

When the hon. Member for Oxford intervened I had just referred to the speech by the Minister of State on 20 June. He did not tell us how industry was expected to invest in modern, cost-effective equipment with interest rates at their present penal levels. How are manufacturing stocks to be funded? How do car dealers fill their showrooms? The Minister did not give the answers to any of those questions.

On 10 December, with the hon. Member for Coventry, South-West (Mr. Butcher), I led a delegation to see Ministers at the Departments of Industry and Trade. Those Ministers were told by major manufacturers of components for the motor industry, employing about 440,000 people, that they had reached the limit of development using normal commercial solutions and for them to continue trading internationally and domestically they now had to look to the Government to create a fair trading environment. So far, they have looked in vain. They appeal for decisive action to combat the situation that the United Kingdom is currently open to all-corners without the restrictions that they find in world markets. They drew attention to the freeing of franchise arrangements as favoured by the Price Commission in a report now with the Office of Fair Trading. They ask that our copyright rules be brought into line with those in other countries to stop the counterfeiting that is going on with brand names. If nothing is done about type approvals, required by foreign Governments, especially for lorries, we should erect our own non-tariff barriers, acting with the same commercial concern for industry as most of our competitors, both in the EEC and internationally.

There should be searching inquiry into the American DISC system, Comecon dumping and local content rules. For example, Brazil requires an 84 per cent. local content and Spain 75 per cent. We have no such requirements. These are all areas for Government action, and time is not on our side. It is predicted by experts in the motor industry that by the end of the 1980s only six volume car manufacturers will exist in the world, each producing a minimum of 2 million units a year. If this is so, it is essential that one of them should be located in Britain, especially when one takes into account the impact on other industries, such as steel, textiles and glass, that are already struggling.

Apart from components, there is at present only one volume producer of vehicles, which has its basic policy decisions taken in Britain. That is BL. So far I have not mentioned Government financial support, but I hope that it is clear from the situation that I have outlined that BL cannot be expected to generate, within a reasonable time scale, the cash flow necessary to continue with its policies of adopting the latest production techniques, as in the case of the Metro, the design techniques in the drawing office at Pressed Steel Fisher and new concepts like the economy car or the next new models.

The Metro, the Ital and the Bounty may enable BL to advance only slightly or even just tread water. If it is to obtain a greater market share, the next new models need funding now in order to retain a United Kingdom vehicle industry. From the present shambles, the Government see emerging a tougher leaner industry, ready for the challenges of the 1980s, but unless some action is taken on the points that I have raised, what is more probable is a leaner, scrawnier industry more ready for the chop.

9.19 pm

The hon. Member for Coventry, North-East (Mr. Park) and I have had this debate—almost a private debate—on many occasions. As we are time-constrained and a number of my hon. Friends wish to speak, I have undertaken to say that I will not detain the House for more than five minutes. I am delighted to see my hon. Friend the Under-Secretary of State for Industry—the Member for Arundel (Mr. Marshall)—on the Front Bench. I am sure that he will deal adequately with any flak flying around the Chamber. I hope that he will appreciate that my remarks and many of those of the hon. Member for Coventry, North-East concern the Department of Trade as opposed to the Department of Industry.

I should like to concentrate on what amounts almost to an injustice—the practice of tied franchise dealer arrangements, whereby a car manufacturer, foreign or domestic, can stipulate that his dealers in the after-market can sell only those parts of which he approves. Therefore, Fiat et Volkswagen, for example, can stipulate that its British dealers must buy their parts from the original German or Italian suppliers.

That is an unfair trading practice. Thankfully, it is now highlighted even more by this Government's recent legislation on competition, which has empowered the Director General of Fair Trading to consider the effect of such monopolies, which eliminate free competition and create unfair pricing, thus causing the consumer to suffer.

The components industry, quite apart from the motor manufacturers, employs over 400,000 people and is of strategic importance. My concern is for free and fair competition in the supplier parts market. I am delighted that, contrary to some feelings held outside the House in the industry, the Minister for Consumer Affairs has fully endorsed the famous yellow book entitled "Prices, costs and margins in manufacturing and distribution of car parts." My right hon. Friend has sent it to the Director General of Fair Trading to investigate this aspect of motor trading under the monopolies provisions of the Competition Act.

My right hon. Friend has, therefore, done everything that she is empowered or obliged to do, but there is one problem. The Director General, by virtue of his office and of the fact that he has to be seen to operate fairly, decides which products to investigate. It is not the Minister's role to point to a particular scandal or injustice. He must make the decision alone. Therefore, the best help that we can give our friends in the motor industry, particularly in the Midlands, is to generate a debate in which the strategic, economic and social importance of the components industry is recognised nationally. I hope that in that context, since the Government have discharged their duties, the Director General will be left in no doubt where his major duty lies at this moment.

9.22 pm

The components industry is, of course, a part of the motor industry as a whole and is not likely to be separated from it, so it stands to reason that a depression in the motor industry will affect the components industry—as the hon. Member for Coventry, South-West (Mr. Butcher) will readily agree.

I want to start from a constituency angle. In the motor car industry—not merely the motor car manufacturers but the producers of accessories and components—no fewer than 10,000 jobs have disappeared in my constituency in the last 18 months, or have been announced to disappear. A large part of the Pressed Steel Fisher plant of British Leyland has closed and redundancies have been declared at Dunlop. More recently, I and other Birmingham Members have heard of the proposed closure of another plant in my constituency—Forgings and Pressings of Witton—which is a part of GKN and which caters largely, or almost entirely, for the motor car industry. That will be a terrific blow to my constituency, quite apart from the small companies which are also involved. If the motor car industry collapses the social and economic consequences in the West Midlands will be a complete and utter disaster. The effect upon our economy as a whole will be equally disastrous.

I mention that as an example of what is going on, bearing in mind that the full impact of these events has not yet struck. Many redundancies have been announced which have not yet taken place. To a large extent the recession in the domestic car industry is a reflection of the recession in the car industry throughout the Western world, and it is true that the Government can do nothing about the problem unilaterally. However, I believe that certain things can be done.

Some aspects of Government policy have undoubtedly hit the car industry. The rate of exchange imposes an enormous competitive burden on the industry. It is no good the Prime Minister or the Secretary of State for Industry saying that the industry must be competitive when, at the same time, the Government are imposing burdens which make British industry uncompetitive to the extent of about 20 per cent. That is a large margin in relation to profits and costs.

Interest rates obviously affect the provision of capital, quite apart from Government policy on the free export of capital. That, undoubtedly, has resulted in British capital being invested in various portfolios and projects in Europe and all over the world when it is required for investment in this country now.

Industrialists in my constituency have mentioned the costs imposed by the Government for energy, including gas and electricity. Those represent an additional burden no less in the car industry than in any other industry. Something can be done about that.

However, our major problem is import penetration. Current figures are calamitous when one considers the gradual and steady growth in motor car import penetration as well as import penetration of other goods. That penetration now amounts to well over 50 per cent. of the total market in this country. I have said before that that cannot be the result of our motor cars being entirely uncompetitive, because we succeed in selling a substantial number of cars throughout the world. British Leyland is having considerable success in selling its products. Our products cannot be entirely uncompetitive when we know that there is an opening for our exports throughout the world.

When one talks about free world competition one recalls that in the past we were a great industrial nation exporting manufactured goods in return for the raw materials that we needed. We could afford to be a free nation in those circumstances. Now, when the manufactured goods that we import are almost equivalent to those that we export, we are in an entirely different ball game. We shall certainly need to review our attitude to this problem in the near future.

It has already been said that various non-tariff barriers are being put up against our goods. We are not very clever at putting up such barriers. Some of them are technological barriers. There are hidden subsidies, tied franchises and all the other various methods which allow countries to exclude imports. This country will, therefore, certainly have to review its policy on import controls. I forecast that the case for selective import controls in order to protect the livelihoods of our people and our industry will find more and more support on both sides of the House, and that in the very near future the cry for such controls will certainly become irresistible to any Government.

9.30 pm

I share the concern expressed by the hon. Member for Birmingham, Erdington (Mr. Silverman) about the level of redundancies in the motor industry. I share his concern also about the level of imports. I do not entirely agree with him about the reason for those imports. I believe that it is much more connected with our level of competitiveness than with other factors.

I shall deal first with import penetration and then refer to some recent comments by Mr. Bill Hayden, chairman of Ford of Europe, after his recent visit to Japan. Finally, I want to deal with areas of Government policy for the motor industry where a more positive strategy is needed.

Hon. Members will be aware that car imports for the first half of this year have captured 57½ per cent. of the market. A factor that has gone relatively unnoticed is the parallel and surreptitious invasion of commercial vehicle imports. In the first six months of this year imports of goods vehicles of less than three tonnes rose by 30 per cent. in value, and imports of those of over three tonnes by 21 per cent. It is disturbing to note the rate at which the Japanese have increased their share of the van and four-wheel drive markets. They now have 36 per cent. of a province where once Land Rover had a virtual monopoly. I find that extremely alarming.

While the Japanese may be adhering to the so-called prudent level of car imports, they are doing serious damage to the British commercial vehicle industry. Let us not forget, however, that by far the largest exporters of vehicles to this country are the Common Market countries. Renault, for example, has about 6½ per cent. of the United Kingdom market—more than half the total of Japanese imports. It is sobering to realise that we have failed to stem the tide of vehicles from Wolfsburg, Rouen and Turin, let alone the flood that is coming from Osaka.

It is important that we do not try to conceal from ourselves the reasons why Japanese car producers have been able to build up such an awesome lead, not only over our car industry but over the European car industry as a whole. That is why I want to quote some of the points made by Mr. Hayden recently. As a result of his visit to Japan he discovered that the Japanese success was due 50 per cent. due to the level of automation and 50 per cent. to the level of dedication of Japanese managers and work people.

There are some specific aspects of Japanese factory organisation that he highlighted that will strike a chord with anyone who has worked, as I have, as a production manager in a British factory. I admit that I worked in a somewhat different industry, but it is surprising how similar are organisations such as maintenance on different kinds of industry in this country. For example, in Japan production line workers do all the simple maintenance jobs on their machines, which means that skilled men can concentrate on the more difficult maintenance work. Such a system goes entirely against the traditional division of labour in British factories, but management and unions will have to face the matter very soon. Similarly, a Japanese press operator will change a die himself, but in a typical Ford plant in this country a team of skilled men is required. In the Toyota body stamping plant a die change takes only 10 minutes, but in a United Kingdom Ford factory, it takes three or four hours. The difference in the way that maintenance is organised is one reason why the productivity of skilled labour in British factories is four to 10 times less than in Japanese factories.

A further important factor mentioned by Mr. Hayden is that Japanese car plants run with scarcely any stocks of components. That is possible because their computer-controlled supply system are so efficient, the quality of their components so good and their factories so strike-free that there is no need to stockpile parts. In a Japanese car factory one may find 12 engine blocks waiting at the head of the line, whereas in a Ford factory there will be two or three days' stock. That gives Japanese companies enormous advantages in keeping working capital to a minimum. Again, we shall have to take note of that.

Mr. Hayden made a further general point that is of great significance to us in the House. In Japan the link between Government, education and industry is so absolute that they are virtually indistinguishable. The system ensures that nothing gets in the way of industry, especially exporting industry.

All these and many other factors explain why Nissan can make the Datsun Cherry in Japan for £1,225 and sell them for £1,661. The same car sells here for only £2,221. Far from dumping cars here, the Japanese are making more profit in Britain than in their own country.

Does my hon. Friend agree that another reason for the imbalance in the motor car trade between ourselves and Japan is that the yen is at an all-time high and the pound is at an all-time high? A further reason is that the Japanese have tied up their internal dealer network in small lots in Japan, whereas we have not. They also have regulations that make it extremely difficult for us to export cars to Japan, but we do not have such regulations. Those are three matters on which the Government can take action.

I accept that the exchange rate has made life much easier for the Japanese and much more difficult for us. However, with the extraordinary differences in price and efficiency, I cannot accept that even a considerable devaluation of the pound would make any difference. The Japanese would still be far more competitive than we could ever be. They have the scope to cut their prices even further if a price war takes place, which is even more worrying.

Faced with that apparently desperate situation, what should we, and particularly the Government, do? We must learn from the Japanese the importance of industry and Government working together. As a nation we must adopt a wholly new philosophy. Everyone—management, unions, Government and our education system—must work in unison to improve productivity, push back imports and increase exports.

The Government need to act with a greater sense of urgency in specific areas. Here I am in agreement with previous speakers. I am an optimist, but, in the light of Bill Hayden's comments it is inconceivable that we can raise the efficiency of our car industry to Japanese levels in the short term. The Japanese car industry will not stand still and let us catch up. It is a moving target, and that makes it even more difficult. Therefore, the Government must put maximum pressure on Japanese manufacturers to adhere to the existing informal understanding that imports into the United Kingdom should not exceed 10 per cent. They must make it clear to the Japanese that if they fail to keep to the 10 per cent. the voluntary controls will become formal and will be enforced.

Why does my hon. Friend think it should be 10 per cent.? I understand that the French have been able to restrict Japanese imports to 3 per cent. in recent years. However, import penetration in other EEC countries has been higher than that.

If Japanese car companies are not prepared to buy more British components, to trade freely and to make it easier for European and British car manufacturers to export their vehicles to Japan, we should demand that they reduce their imports to about 5 per cent. That would be reasonable. It is also important that the Japanese should be asked to cut down their sales of vans and four-wheel drive vehicles to 10 per cent. of the United Kingdom market and to hold them at that level.

The Ministry of Transport should move more rapidly to ensure that administrative controls on imports are at least equivalent to those imposed by our competitors.

Recently, I talked to a manager from the Leyland Truck Company who said that it is possible to have a new Renault truck on the roads in this country within a few weeks, whereas the equivalent British Leyland truck would probably take over a year to pass all the regulations and get on to the French roads. This is an injustice. I cannot accept that it needs to take until April 1982 to introduce type approval for imported trucks. We need a greater sense of urgency by Government Departments. After all, we are talking about the survival of an industry.

I turn now to the subject of financing for British Leyland. I ask the Government to take note of what has been achieved by British Leyland under the leadership of Sir Michael Edwardes against enormous odds. The new Mini Metro will generate much of the cash for future models, but additional capital will be needed if the LC 10 and the AM 2 are to be developed successfully. Therefore, I ask the Government to recognise that if BL is starved of investment capital it will die, with all the consequences for unemployment of which the Minister is aware. It is not possible to run a business the size of British Leyland on a trickle-feed basis. Now is the time to start funding the LC 10, which is due to be brought out at the end of 1982 and is a crucial addition to the new model range.

I turn briefly to the role of management and unions. The challenge facing management in the short term is to raise the efficiency of our car plants to the levels of our European competitors. That is possible if the motivation of the work force can be raised. Those who went on the all-party motor industry committee visit to Renault some weeks ago saw factories which were efficiently run and where the manning was tightly controlled, but Renault was not so far ahead of us in terms of automation. The new Metro facility at Longbridge has put British Leyland ahead of the Europeans in some respects. Therefore, this should not be an impossible target.

Productivity is not the only factor. There must be a relentless drive to improve the quality of British vehicles. If the British public can see that a British car is as well designed and finished as its foreign equivalent, they will return to buying British cars in large numbers. But doors must fit properly and bits must not fall off. Attention to detail is the order of the day.

I turn to the role of the trade unions. I certainly do not underestimate the difficulties facing union leaders in the car industry at present. They are being asked to agree to revolutionary changes in manning at a time of high unemployment. However, I am happy to report that considerable progress has been made at the Longbridge plant in terms of industrial relations. That is particularly true of the new Metro facility where, for example, on the Kuka welding machines, instead of the entrie range of crafts being represented, maintenance teams have been established with union agreement consisting only of electricians and fitters. That will mean a much faster response to machine breakdowns, because fewer separate crafts and management hierarchies will be involved.

I believe that our motor industry needs some protection from the Japanese. Therefore, the Government must take a firm line on imports from that country. At the same time, the British motor industry must make strenuous efforts to raise its efficiency at least to European levels. It is the role of the Government to remove the obstacles to the revival of our motor industry. It is up to management, unions and the work force to bring that revival about.

9.46 pm

I do not think that this is a controversial debate. There may be some differences in emphasis between us, but basically I accept the diagnosis of the hon. Member for Birmingham, Northfield (Mr. Cadbury). All the constituencies represented in this debate face a common problem. Over the last few months, all of us have repeatedly referred to the onset of unemployment among our electors, to the closure of plant after plant, to short-time working, to redundancies among people in the prime of their working lives—some with a lifetime of service behind them—to hopelessness among school leavers and to increasing numbers of unemployed chasing a diminishing number of vacancies.

I do not think that this is merely a syndrome of the depression, because some of it is not cyclical in nature. We are losing markets which are irrecoverable. We are draining away skills which are irreplaceable. Apprenticeships are being denied to young people, who for ever will lose the prospect of that training. We have just had a report from the Manpower Services Commission on training in this country, and there was a disturbing comment on it in The Observer on Sunday.

We have had explanations for all that during the debate, and I do not think that there is much division between the two sides of the House. It is to do partly with high interest rates, partly with the consequent exchange rate of the pound, partly with inflation and partly with competition from foreign producers whose Governments shower them with advantages which are denied to producers in this country. In that situation it is not surprising that some of us have felt the need to look particularly at the vehicle building industry. That, more than any other factor in our lifetime, has dominated industry in the West Midlands.

I was pleased that at an early stage in the debate the hon. Member for Coventry, South-West (Mr. Butcher) introduced a discussion about the components industry. While many of my constituents work in car assembly plants, particularly at Longbridge, I specially want to say something this evening about the many firms—some big and some small workshops on street corners—which produce components for the car industry.

When car manufacturers went into business and expanded rapidly in the 1920s they needed to establish assembly plants near to a flourishing engineering industry. They found one in the West Midlands. They found an engineering industry which was highly diversified and which could produce virtually all their needs. They found companies making nuts and bolts, screws, brass products and pressed steel products as well as foundries, makers of springs, tubes, plating, leather goods and paint. All of them were there among the communities in the West Midlands. The car industry brought them a new prosperity, but in return it made very great demands on them. In place of the special orders in which they used to deal, it required vast quantities of standard products, and the engineering industry totally restructured itself for that purpose.

Within the 30 years from 1920 to 1950 the car industry changed the whole character of the West Midlands. Some of the earlier industries had contracted, in some cases almost to extinction—saddlery, nail making and wheel making—while special light steels, laminated springs, precision tubes and rivets all flourished.

Then, as the vast numbers of standard parts were required, the processes were broken down. The comprehensive skills of toolmakers such as my father were replaced by narrower and more specialised skills, some of them appropriate only to particular toolrooms. The industry was organised to depend more or less upon an even flow of orders. The components—which in many cases were wanted in millions—required storage space, and storage space to cope with more than a few day's production was usually not available. The capital wrapped up in those components meant that if the process was interrupted for any length of time there was a serious cash flow problem. There were relatively high earnings for those who had not served apprenticeships if they were prepared to do tiring and repetitious physical work in unnattractive jobs.

Those with engineering skills found that they could earn more money by leaving their engineering jobs and going elsewhere. Those contemplating taking apprenticeships saw little point in acquiring the skills, and that in turn led to a further breaking down of the processes to dispense further with the need for the old skills. So industry in the West Midlands was left with a high proportion of its work force in boring work, sometimes with very little job satisfaction, and toolmakers were left with the kinds of frustrations which led to the toolroom strike of 1977.

The hon. Member for Northfield will not be surprised if anxiety among the maintenance staff has led to the kinds of problems which, as he pointed out, do not exist in Japan, because the history of the industry still lies heavily on the present in this country.

The car industry changed the whole character of the area, even for those who were not directly concerned in producing for the industry. If the car industry were to disappear today, the engineering industry in the West Midlands would never be the same again.

I am not complaining. This all brought great prosperity to the area. We can only be grateful. But the region became over-dependent on one industry. If that industry contracts, it entails not merely reductions in its own work force; it carries with it contractions in the whole of the engineering industry of the West Midlands, and drags behind it the basic industries, such as steel and coal. So the car industry carries on its shoulders the whole prosperity of Britain's industry, and particularly of industry in the West Midlands, the cradle of the Industrial Revolution.

The car industry has recently not been proving successful against foreign competitors, either at home or in its markets abroad. As my hon. Friend the Member for Coventry, North-East (Mr. Park) said, there are several reasons for that. Partly it is to do with the position world-wide: partly, as the hon. Member for Northfield said, the fault is to be found within the industry itself.

We have seen with alarm a number of statistics, many of which have been quoted tonight. There was a recent table, produced by the Society of Motor Manufacturers and Traders, showing that the production of cars for the home market fell from 728,000 in 1978 to 678,000 in 1979. It is estimated that it will fall to 500,000 by 1981. Production for exports fell from 495,000 in 1978 to 392,000 in 1979. It is estimated that it will fall to 350,000 by 1981.

I accept that those statistics could be misleading because cars are assembled in one country from components produced in another. However, we are left with the clear impression that the trade is contracting. If the problem is largely one of scale—we are told repeatedly that it is—even British Leyland is substantially smaller than most of its competitors in America, in Japan or even in Europe. If British Leyland is already too small in comparison with its competitors and it becomes smaller, it will be caught in a descending spiral, and that will be reflected throughout the economy.

In an earlier debate my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) commented—I think that the comment was repeated by my hon. Friend the Member for Birmingham, Erdington (Mr. Silverman)—that we were approaching the stage when our net imports of manufactured goods will exceed our net exports. Some of the fault undoubtedly lies at the door of the industry. Never-lies at the door of the industry. Nothing much will be served by apportioning the blame. It is easy to blame management for mistaken decisions. Perhaps in many instances they were not easy decisions.

Does the industry offer the customer a wide range of models or does it go for fewer models and economies of scale? Does it concentrate on the home market and ensure that there is a proper flow of replacements, or does it push sales in overseas markets? If it wants overseas markets, does it engage in dubious local practices of the sort which would not be acceptable in Britain? Does it have a large number of dealers, some of whom have to make up their income from carrying other products, or does it guarantee a good living to a more limited number of dealers? Does it have wage rates and working conditions negotiated at plant level or does it seek to standardise the structure throughout the organisation?

We might question some management decisions with the benefit of hindsight, but we can consider them with some sympathy. I do not seek to put the blame on management. It is too easy to blame the trade unions, too. Those who know the feelings of frustration among those who feel that they have not been consulted about these problems, a work force which feels that its members have been treated as "hands" with no job satisfaction, no room for decision making and no real participation, will understand why there has been a measure of industrial discontent.

Happily there are signs that all sides of the industry appreciate its peril and the peril of all those whose livelihoods depend upon a flourishing assembly industry. We have seen examples recently in the new Metro line. But those concerned will need substantial help if they are to give effect to that new resolution. For it is partly, too, a world-wide problem.

I seize the opportunity to raise two essential issues. First, it is impossible for any Government, however Manchester school their basic philosophy may be, completely to abdicate responsibility for the industry and to renounce any concern for it. Surely no Government can claim that they have no concern for what would be on the scale of a national disaster.

It is not true that British Leyland receives a greater proportion of Government assistance than some of its competitors elsewhere. Renault receives substantial support from the French Government. Chrysler receives substantial support from both the Federal and state Governments in the United States. Volkswagen receives a large measure of regional aid in Germany. The Japanese industry has a national banking system at its disposal. Most of Britain's competitors have a single integrated research structure throughout their industry with Government research laboratories at their disposal as well as university research centres and industrial research and development depots. No one can pretend that Britain pampers its motor industry. I wish to announce a personal recantation. I have always believed in freeing international trade. My constituents largely depend on exports. It has never been part of my political principles to export unemployment to workers elsewhere, even if that were to prove a practical proposition.

I have been compelled to revise that conclusion in two ways. First, all the countries with which the car industry competes encourage their populations to buy their own products. They sponsor campaigns encouraging individuals to buy their own cars. They encourage companies to equip themselves with fleets of their own cars and commercial vehicles. Of course, most hon. Members here drive British Leyland cars—perhaps Sir Michael Edwardes was a little less than fair to some politicians a few months ago. But the Government could give a lead. I hope that they will give support to Sir Michael Edwardes' remarks.

Secondly, we have seen how the Governments of some other countries ensure that imports from Britain and other countries face every possible discouragement. The hon. Member for Northfield has already referred to some of those discouragements. Two obvious examples are Japan and Spain. Those countries should not be surprised if the United Kingdom does not welcome their exports. I have argued that point before, and I shall not labour it now. International competition can exist only when the competitors start from the same line. Of course, some types of restriction would infringe on our international obligations, and I do not urge them on the Government. But, many examples of non-tariff barriers operate elsewhere. There is no reason why they should not apply here.

Even in this area, some of the problems are of the industry's making. In a debate on 16 May, my hon. Friend the Member for Birmingham. Stechford (Mr. Davis) mentioned the decisions made by Ford, Vauxhall and Talbot to import vehicles which will then be sold in Britain. The Government are entitled to tell the vehicle industry that its future is inextricably connected with Britain's future. They should tell the industry that, as the Government are willing to recognise their responsibility, the industry should recognise its responsibility to its work force, its suppliers and to its consumers. If the industry succeeds, we shall all be winners. If it fails, it will drag us all into the pit.

10.3 pm

I am happy to speak after the right hon. and learned Member for Warley, West (Mr. Archer). I accept the importance that he attaches to the motor industry, not only in the West Midlands, but in the country as a whole. However, it would be difficult to deduce that from the attendance in the Chamber, which consists largely of hon. Members who represent constituencies in the West Midlands.

I sympathise with the Minister, as he is receiving a fair amount of shot and shell on subjects for which he is not directly responsible. However, with his considerable industrial experience he will appreciate the points that have been made. We feel that we are speaking to an open mind and an open heart. However, he is unable to be as forthcoming as he and we would wish, given the importance of the industry to the country's structure.

I must warn my hon. Friend the Minister that people all over the country—and on both sides of the Chamber—will regard the motor industry as the litmus test of the Government's policy towards industry. The Government's policy is not yet fully apparent. I was surprised that the hon. Member for Birmingham, Erdington (Mr. Silverman) did not allude to the grant to Dunlop which has recently been announced. It was a considerable surprise to me. I do not know whether it is a first swallow making a summer or whether it is a special case. We should like to examine the matter further.

We believe that there is a need for the Government to demonstrate an urgency, a sense of realism and a sense of appreciation of the national interest, such as my right hon. Friend the Prime Minister displayed so clearly in her dealings with the EEC on Britain's budget contribution. The echo that that aroused throughout the country encourages me to urge on the Minister a similar robust attitude towards the motor industry. An equal if not greater response is still to come.

I say that the Government should demonstrate a sense of urgency and realism in the national interest because the motor industry faces the twin threat of a decline in demand matched, if not overtaken, by an increase in imports. That threatens not only the mechanical restructuring of the industry but the change in attitude which the Government were elected to bring about and which Sir Terence Beckett of Ford said in his evidence to the Select Committee was a precondition to bringing up our industry fully to international standards of competitiveness.

I accept the Government's priority of an attack on inflation. Inflation largely brought about the downfall of British Leyland in addition to other contributory factors which I have mentioned in previous discussions. I fully accept the need to be competitive by increasing productivity and quality. I welcome the Prime Minister's repetition of these themes. In BL giant strides have been taken towards the realisation of such aims.

My hon. Friend the Member for Birmingham, Northfield (Mr. Cadbury) referred to our recent visit to Renault. We were encouraged when we saw that equipment there was not up to the standard of that at Longbridge and that its engine plant was even more outdated than some in our factories. The Renault plant is also over-manned and inefficient. But it has advantages. The aims can be achieved and are being achieved. The Metro line is equivalent to any Japanese wonder production line in the fully automated parts.

Productivity gains are being made. The hon. Member for Coventry, North-East (Mr. Park) referred to unemployment and demanning. Sir Michael Edwardes made a remarkable achievement in the last two years in that 24,000 out of 130,000 of the work force—about 20 per cent.—have been made redundant. There has been a striking drop in employment in the firm. It is not sufficiently appreciated that the last six months have been 98 per cent. dispute-free at BL. That represents a fantastic change in attitude. I must admit that I was surprised to find out recently that there has been no strike at Bathgate in Scotland for the past two years, contrary to the impression that some people may have.

Considerable progress is being made, and it is appropriate to offer a tribute to the work force, who have accepted the need for greater productivity and greater flexibility in manning, as was demonstrated recently by the stop and switch of production by BL between various models of which there were surplus stocks or for which there was excess demand. The changes of attitude, the flexibility and the competitiveness are to hand.

I was glad to read this morning an authoritative statement that the present inflationary effects are not the result of wage claims. There have not been excessive wage increases in the motor industry. In BL, wage increases have been 5 per cent. for the past two years. Hon. Members who feel hard done by should pause to reflect on the lot of those who have had 5 per cent. wage increases for two years running. One can understand their resentment and bitterness about those in the public service who have taken much greater increases without any apparent increase in effort, flexibility or adaptability.

A sense of realism is a keynote of my right hon. Friend the Prime Minister's Administration. What could be more realistic than the open admission by the deputy chairman of BL before a Select Corn-tee that if the Metro fails the company will be prepared to abandon volume car production? That must be matched by equal realism on the part of the Government. If the car is a success—and that will be known fairly quickly; the Government cannot expect to be able to wait until next year before reaching a conclusion on the matter—long-term financing will be required for the entire model range. It may not be funded immediately. It may have to take the form of guarantees initially, but orders have to be placed now for the necessary machine tools to give effect to the production of those models.

We are sometimes rather shy about discussing dealers, but employment in garages and dealers downstream of production equals that in the car assemblers. The BL dealers need to be assured of a continuity of new models to enable them to hang on through the present difficult times. It is important to understand that. The BL dealers have been faced with a disastrous decline in market share and a high increase in costs, because of high interest rates. They have held on, demonstrating their loyalty, despite all the diffi- culties, but they need to see some light at the end of the tunnel, because otherwise they will have no option but to go over to other franchises and thus to increase penetration.

All component manufacturers have been faced with a double jeopardy. Not only has there been a fall in demand from domestic assemblers but, because of our high exchange rate, many assemblers have had to import components in order to remain competitive on their finished product. That is particularly true in the tractor and agricultural machinery sector, which has had a disastrous result on foundries and forgings.

However, the same phenomenon is also present in motor car assembly. The component makers have faced a double threat, while being frustrated by the franchise agreements to which reference has been made. As the hon. Member for Birmingham, Stechford (Mr. Davis) will be aware from his previous incarnation, some motor manufacturers have found their spare parts operation fairly profitable and would not necessarily welcome a relaxation of the franchise, for which a call has been made in the debate.

The exports of the component sector have been frustrated by the higher pound. The sector is also suffering, as I mentioned in a debate on West Midlands industry, from the disparity in fuel prices, notably gas and coking coal about which I had occasion to take a delegation to the Department of Energy last week. What is the rationale of the grant of £ 6 million to Dunlop? I hope that the Minister's thunder was not stolen by the Prime Minister, but the House is owed some explanation of the rationale behind the grant and how other firms may qualify or may be disqualified from similar treatment. This is a matter of public concern.

I have referred to the threat from imports. In that context, attention is obviously concentrated on Japan. We should well understand the position of Japan, an island country bereft of many natural resources, depending on manufacturing and exporting to support its population. We find ourselves in a similar position. The position achieved by Japan not only in this country but in America and in other European countries means that a halt has to be called unless some irreparable damage is to be done.

Does my hon. Friend agree that the motor manufacturers anticipated, when Britain joined the EEC, imports of 25 to 30 per cent, including Japanese imports? We now have 57 per cent. imports, nearly half of them—at least 27 per cent.—from tied imports and nothing to do with Japan. Those tied imports mean that workers in my constituency making textiles for carpets are losing jobs. This affects textiles, safety belts and the whole paraphernalia of components. The effects are not as immediate in the constituency of my hon. Friend, but my constituency is affected by massive tied imports that make Japanese penetration look almost paltry.

I am grateful to my hon. Friend, although I find it hard to swallow his description of Japanese imports as being paltry beside tied imports. He must be referring particularly to those of Ford. It was in evidence before the Select Committee of which he is a member that the chairman of Ford made it plain that those imports had been largely occasioned by failures of production in this country for one reason or another, and, in part, by reason of its model policy and the fact that it is European based for reasons of economy of scale to which the right hon. and learned Member for Warley, West referred. I wish to deal with the question of scale of British Leyland in a moment.

Japanese penetration has now reached 22 per cent. in America, higher than that of the Ford Motor Corporation in its own back yard. This must be politically unacceptable. The penetration in Germany has increased. Contrary to popular belief, I think that the Japanese are making a dead set at Ford rather than BL on a world basis.

The immediate concern is the future of the current voluntary industry agreement under which the Japanese industry undertook to exercise prudence in exporting to this country. Prudence was generally understood to mean 10 or 11 per cent. of the market. Ten or 11 per cent. of the market last year is a very different thing from 10 or 11 per cent. of the market this year. If the Japanese were to continue to export at last year's rate, they would end up with 18 to 20 per cent. of the market this year. The cause for concern is that their shipments are still increasing. Over the first six months of the year, they show an appreciable rise over last year.

That calls into question what prudence is in these circumstances.

Does not my hon. Friend agree that it would be absurd to ask a Japanese sales manager to exercise prudence voluntarily? Why should he? Not only is it alarming to see the flood of Japanese imports into Europe, with some 606,000 motor cars imported during the last year as opposed to their taking some 3,000 of ours. Ought not my hon. Friend to touch on the absurd anomalies of imports from Spain and Eastern Europe? In Spain, a tariff operates against us of 38 per cent., whereas operating against the Spanish is a tariff of 4 per cent. Eastern Europe exports 50,000 motor cars to us and accepts back 400. Does not my hon. Friend agree that the Government should take rapid steps to stop these totally inequitable balances against us?

I appreciate that my remarks have been lengthy, but I had intended to deal briefly with Spain and Eastern Europe. I was not trying to cover the whole gamut in my remarks, especially as the way had been paved for me by my hon. Friend the Member for Northfield.

As regards Japan, there is real concern about how this voluntary agreement is to run for the rest of the year. There is further concern that the Japanese are installing an additional 2 million vehicle capacity over the next two years and, therefore, there is great uncertainty about where those vehicles will be directed. It appears unlikely that they will be allowed into the United States of America. The conclusion is that they will come here.

I am not persuaded that Government action is necessarily the best way. We have to reckon with the difficulties of Japan and the peculiarities of the Japanese characteristics. I believe that the voluntary undertaking between the two industries has worked very well. All that I am trying to emphasise, perhaps in a rather Japanese manner, is that there is concern about the rest of this year and, in view of the additional capacity being installed, in my view the industry-to-industry agreement will probably have to be expressed in terms of longer than a year to guard against what will result from the additional capacity.

In the light of what my hon. Friend has said and the case he has been arguing against voluntary agreement, does he not consider that in the background at least there should be the threat of some form of statutory agreement? If the Japanese persist in exporting an enormous quantity of vehicles to the United Kingdom and thereby threatening our own industry, should we not be prepared to take action against them, if necessary by statute?

I thought that I had made it plain in response to my hon. Friend the Member for Abingdon (Mr. Benyon) that I did not favour statutory action. My first reason is that which I tried to outline about the difficulties in which the Japanese find themselves. We must have some understanding of that valuable ally with a very large population on an island with no resources. Obviously they are concerned to ensure a continuance of free trade. However, I am saying to them that the continuance of free trade will be endangered if they do not exercise prudence. The second reason is that from our point of view we must hesitate for a long time before we bring in statutory import restrictions. The point has been made that we are uniquely dependent as a trading nation on freedom of trade and have the highest proportion of GNP already accounted for by trade. I am afraid that I could not agree to my hon. Friend's suggestion at this stage.

Mention has been made of Spain. Spain is about to become a member of the EEC, and I hope that these problems will be resolved as part of that necessary negotiation. But I take comfort from the fact that in the meantime Ford has given a clear commitment to reduce its imports from Spain in the remainder of this year by half the amount that it imported from there last year. That will make a considerable difference. There is no doubt that there is discrimination against us and that it will have to be resolved on an EEC basis.

I asked at the outset for Government action which was urgent, realistic and in the national interest. Apart from the more general questions of interest rates and exchange rates, that action should concentrate on type approval both for cars and for lorries. In fact, to correct my hon. Friend the Member for Northfield, I would point out that it took 18 months to get type approval for the British Leyland commercial vehicle in France. We have no national type approval for cars—we rely on EEC directives—but other EEC countries have their own national approval systems as back-up, whereas we do not, and for commercial vehicles we have nothing at all.

We must face up to the need to increase the payload of commercial vehicles and to spread the load better among the axles. I can imagine the reaction to that statement from the environmental lobby, but our commercial vehicle industry is fighting with its hands tied behind its back against European imports. Not enough mention has been made of the fact that the import problem is developing just as seriously for commercial vehicles as for passenger cars.

The Government need to discuss with our European partners the elaboration of a trade strategy to deal with Japan, Spain's access and trade with the Comecon countries. I argue unashamedly that our Olympic boycott should have been coupled with some commercial sanction. The Olympics have now ended. How will our protest now be expressed against the continued Soviet occupation of Afghanistan?

I was disappointed to receive a reply from the Department of Trade when I last raised the subject reminding me gently that it was in our commercial interests to continue trade with the Eastern bloc, where we showed a visible trade balance. Such a reply is not my idea of how one protests at the action of a foreign Power.

The Government will also have to fund BL once the results of the Metro have been seen. It is impossible to continue running a company of that size on an annual financial dripfeed, as one of my hon. Friends described it.

My next point may seem a small matter, but the Minister, with his experience of industry, will be well aware of its importance. Much more of our R and D effort should be placed in firms and directed by firms rather than by Government research establishments. I know that there have been reports on that.

The Government have made a good start on bringing about the necessary changes of attitude, but further resolute action is needed to demonstrate the Government's commitment to those working in the motor industry. I am sure that that will meet with a more than corresponding response.

10.28 pm

Like the hon. Members for Birmingham, Northfield (Mr. Cadbury) and Bromsgrove (Mr. Miller), I have visited the Renault car factory. I confess that I went like a country cousin, thinking that I would see how a vast car industry should be run. As the other hon. Members have said, we discovered that the mechanisation and technology did not put the British industry to shame at all.

In Chrysler at Ryton, Coventry, we were able to stand up to what Renault could show. But even to my inexperienced eyes men could be seen standing around. Overmanning was there to be seen by anyone who bothered to look.

The problems of the British car industry in relation to manning, machinery and mechanisation were not answered by our visit to Renault. I confess as I look around the House that, vicariously and otherwise, I probably have greater experience of the car industry than any hon. Member present.

Growing up in Coventry with a father who worked all his working life in the car industry, I could not help but learn of the difficulties of that industry. In our family, it sometimes seemed that we talked only about two things. One was the hopes and fears of the Labour Party, and the other was what would happen to Coventry City football club at the weekend. But within those conversations ran the theme of the day-to-day work and problems of the car factories.

We need look no further than Coventry to see the warning—it is there for anybody who bothers to look—about what could happen to the British car industry. When I was a boy we talked about motor cycles. There was the Rudge, the Humber, and the Triumph. It seemed like a stable industry in Coventry but the motor cycle industry has gone. There is no longer a motor cycle industry except for Meriden which is struggling to keep its head above water. Anybody can understand just by looking at Coventry what has happened to the motor cycle industry and what could, just as easily, happen to the car industry.

We have, of course, seen great changes in Coventry. When I was a lad there were Alvis, Singer, Morris, and Standard Triumph cars. They have disappeared altogether as names. Other names have taken their places, but it is apparent to all of us that the British car industry faces a serious situation. There is no need to look further than the boundaries of Coventry to see that. To the Minister who will reply for the Government I say that it is a time to be vigilant and to realise that what happened to the motor cycle industry can, just as easily, happen to the car industry.

Rudge motor cycles have become a name for the museum. We should be careful to ensure that Jaguar and Daimler do not likewise simply become museum names.

10.33 pm

This debate is everything that is good about the House of Commons. It is the model of a debate where hon. Members, self-evidently for the same reason and sharing a common problem, have come together to debate the needs and problems of their constituents in relation to the motor industry.

I was particularly impressed by the speech of the hon. Member for Coventry, North-East (Mr. Park), who opened the debate. It was factual, it was real and it was a credit in setting the scene for this debate. There is no river Jordan flowing through the Chamber with opponents on either side. We come here with a common purpose, and I believe that that purpose is the British motor industry. I believe, from the tenor of the debate, that we are all dedicated disciples to that aim.

I do not believe that there are any more enthusiastic advocates of British Leyland than the right hon. and hon. Members now in the Chamber. The Government, like their predecessors, have taken a realistic view of the problems of BL and have given financial aid. The aid to BL amounts to about £300 million in the current year, and I am informed that £275 million has already been paid.

I am able to reflect, for personal reasons, on the identical debate that we had on this subject last year. It was most interesting that in that debate all those who spoke gave a solemn pledge that they would support the British motor industry. I am assured and confident that again tonight the Members of this House will support British Leyland.

Provisos and conditions may be attached to that support. I suggest that we should support British Leyland at a realistic and an economic price, but not at any price. The economic realities of life are being grasped by the board, the management and the employees of BL, I am sure. It is a tribute to them that we have heard repeatedly in this debate that the work force at BL has accepted a 5 per cent. increase in pay in order to create what we all want—a viable British motor industry.

What are the economic realities? What is the future? How secure are the jobs in the work force corporate? BL took £150 million of aid in April, another £75 million in May and a further £50 million in July. I share the simple view that the financial reality is that the Metro model, to be launched later this year, is the key to the future of the company. Several times during my speech I shall direct my remarks to my Front Bench to say that BL needs funding for that model. If the Metro should fail in terms of performance, reliability, availability or price, the position would pass, I believe, from being serious to critical. I am led to understand that that is the view of the board of BL.

I spent most of Saturday morning viewing the Morris Ital. To suggest that it is a Marina Mark II is most unfair. Again, this model is to play a crucial part in the survival plan of British Leyland. I am not ashamed to say that my soul wept, particularly since I was in the Principality of Wales, when I realised that the design features came from Italy. Here we have a British model that is alleged to have been remodelled in Italy.

I do not normally use such expressions as "survival plan". It is an indictment of successive Governments, management and the company generally that we have to talk of a survival plan for one of our great, traditional industries. The new series A engine and LCIO model will require Government assistance to finance stocks from the initial launch. It is sad to discover the inability of this great British industry to supply models in prime demand, such as the Range Rover, Jaguar, Daimler and Rover. There is growing need for financial aid to introduce a replacement for or complement to the Princess range. The work force in the group has amply demonstrated a new sense of realism and is facing the cold, stark realities of survival.

Since 1977, British Leyland has lost 7 per cent. of the United Kingdom market. Ford has increased its share by the same percentage, and imports have increased by about 13 per cent., made up of 3 per cent. from Germany, 4 per cent. from France, 3 per cent. from Belgium and 3 per cent. from Spain. It is vital that the industry grasps the message that to be viable it must have a secure home-based market. I suggest that it is only on the platform of a secure home market of about 25 per cent. that it can launch into the export market, which is what we all want. In simple economics, orders equal production equal jobs equal profit equal further investment equal further jobs, as was brought out earlier by the hon. Member for Coventry, North-East. Everyone on the payroll of British Leyland should be a salesman. The first ingredient of production is an order.

In my constituency and the adjoining constituency of the right hon. and learned Member for Warley, West (Mr. Archer), we do not make motor cars. We have never done so and are unlikely to do so. However, we have a host of small businesses that supply components to that vital industry. Naturally I am concerned about the welfare of those companies. I was surprised to learn that 400,000 people are employed in industries related to the motor industry. My constituents make components in steel, brass, plastics and rubber. The bond between all these industries was amply illustrated by the hon. Member for Birmingham, Erdington (Mr. Silverman). Many of the companies suffering vast redundancies are in my constituency. I have received correspondence, for example, about the problems in Fisher. So there is a common bond bindine us together.

Another important feature that was brought out was a greater share of the market. I shall not dwell on that feature because it has been covered amply on the order situation. But I take the gravest exception to motor companies based in this country and receiving aid which import foreign vehicles. They are importing not vehicles, but unemployment, and to do that at the taxpayer's expense is outrageous.

A buoyant, healthy motor industry based in its home in the West Midlands—I am not ashamed to be selfish we all share the same view—would mean a healthy constituency with full employment, which is what we are all here to achieve in the context of the West Midlands.

The message that I give to the British motor industry is that, like other right hon. and hon. Members, I shall support its further claims. I give it a vote of confidence which I am sure is not misplaced. I still have the faith to believe that the West Midlands will accept the challenge to produce a viable, British motor industry. To that end I give my pledge this night, which I am sure will be echoed from this Chamber to the country.

10.47 pm

Thank you, Mr. Speaker, for noticing me at this somewhat late hour. I ought to apologise to some of my colleagues for not having been here earlier, but I have had a fairly full day on what I think one could term other commitments.

I am delighted to speak after the hon. Member for Dudley, West (Mr. Blackburn), because he and I represent constituencies whose economic well-being reflects the health of the motor car industry. There is a developing situation of industrial degeneration in the West Midlands caused partly by the decline of the motor car industry. In Smethwick and Oldbury particularly the effects will be truly tragic in terms of the standard of living of the work people around there, of the employment prospects of young and old alike and of the blighted hopes—this is perhaps the most depressing aspect of the whole picture—of thousands of youngsters who will enter their adult lives with their expectations of work and social fulfilment completely blighted.

The companies affected by what I can only term as industrial collapse in the Smethwick picture are a litany of some of the best known names in industry. I do not want to weary the House with the numbers of redundancies in each of those companies, but they are now reaching quite staggering proportions. Each of the names that I mention now—well-known names in British industry—are laying off in some cases hundreds, in other cases dozens, of workers who in many instances are not likely to see those activities restored again: Midland Motor Cylinders, Mansell Booth, Avery, Wilkinson Riddell & Larkin, Smethwick Drop Forgings, GKN Fasteners, Chance Brothers.

Then there is the sad saga of Dartmouth Autocastings. I believe that the programme that Birmid Qualcast has implemented of closing Dartmouth Auto-castings and Birmetals, which was discussed earlier in the House, and Midland Motor Cylinders is quite deliberate.

I have had an innuendo, if I may term it such, from a reliable source that it will not be very long before Birmid Qualcast moves its headquarters altogether from Smethwick to Derby, with an appalling effect on the life, and prospects of work, of people in my constituency. Derby—and I do not wish to attack any of my colleagues here—seems to be the heavy part of the BQ involvement in terms of foundry business, because BQ management appears to be Derby influenced in that the majority of people in the Smethwick management—I am sorry to say that this seems to be one of the factors—are ex-Derby Qualcast people.

Of course, we shall have from the Government all the usual excuses. The heartless monetarists on the Conservative Benches have conjured up a number of excuses which they reiterate on every occasion. There is a world recession, as if we did not know that. The Arab oil producers will exact a price for Western support of the State of Israel. Some of us warned of that many years ago. There is a lack of Western leadership—my God, do not we realise that?—not only in America, the great Western country, but also in this country, and, sadly, in some of the European countries.

We suffer from all of those, but the fact remains that this Government are directly responsible for three factors which are making the existing pressures much worse and the situation in the motor car industry infinitely more depressing. The first is the over-valued pound which works against exports. I am sure that some of our colleagues on the other side of the House would agree about that. Secondly, there are high interest rates, which prevent any hope of investment in improved productivity. I see nods of agreement. Great; we are making progress. This is an unusual and happy situation in the House of Commons. Thirdly, there is roaring inflation, which Government policies have stoked up. Perhaps I can have some agreement on that as well.

Does not the hon. Gentleman agree that the rate of inflation is showing a significant fall? Will he, therefore, give credit to the Prime Minister, who so ably leads this country, for her brave policies which are now working?

This is the time of the year for young and expectant Tories to make these happy statements of support, because there may be Government reshuffles. I am sure that that bright beaver on the Conservative Benches would like to be considered in that happy band.

Of course, there has not been a marked drop in inflation. There has not been great leadership by the lady to whom the hon. Gentleman referred. If the hon. Gentleman questions my raising the issue of inflation, I remind him that he is a young Member who may not have been here at the time of the Budget. Perhaps he was rehearsing a speech elsewhere. Perhaps he was not present at that Budget. In case he has forgotten, let me remind him that it was that 15 per cent. VAT increase which largely stoked up the inflation from which the country is now suffering. Though I do not have a nod of agreement, I certainly do not have a denial.

The analysis that I have just given is one that is agreed by West Midlands businessmen across the board. I am sure that we have agreement on that as well. They are angered that the Government listen too avidly to the theoreticians, the economists and the financial experts who conjure with figures rather than to the practical men of business, such as the industrialists and the small business men themselves who have their finger on the industrial pulse of Britain and know what is happening. They should be listened to rather more carefully than they have been listened to by this Government. They know the damage that is being inflicted on local industry, and they say quite openly that some of the damage will be permanent in the West Midlands. There will be no recovery. There will not be a sudden phoenix rising out of the ashes. There will simply be ashes in the West Midlands in a lot of those industrial setups.

The most devastating effects are on the young people as they leave the school gates for the last time. For many, more than half of them, there is no prospect of work of any sort at all. This problem is causing tremendous concern, not only among Members of Parliament who sit here for the area, but among local councillors and education staff in particular.

Following a meeting between the director of education, the Members of Parliament, some of the local councillors and trade union representatives, our local director of education, an excellent man called Mr. Brindson, wrote a letter to the Prime Minister, and I should briefly like to give one or two quotations from it. He goes through the numbers of jobs available for young people just coming on to the labour market. There are thousands of such young people and there are jobs numbered in dozens. That is the reality of the situation. In the letter, which is addressed to the Prime Minister, he says:
"There are signs that companies and other organisations are withdrawing the places on Work Experience because they are having to make redundancies and/or introduce short-time working in order to keep their businesses afloat. One hundred and fifty places on WEEP"
—that is, work experience on employers' premises—
"have been suspended and eight cancelled in the last three months."
Towards the end of the letter he says that employers locally—and this is true—are doing their damnedest to provide opportunities. I am sorry, Mr. Speaker, I should pay more regard to your and my common background, and I withdraw that remark. They are doing their very best to provide job opportunities for a lot of these young people.

Brindson says:
"Employers locally are very sympathetic to the situation but are unable to help in any way and so the Careers Officers face a new challenge of maintaining morale and strengthening the motivation of young people who are becoming increasingly"—
and he has underlined the word—
"despondent. Many of the young people have made determined attempts to obtain employment; have completed shoals of application forms; written several dozen letters each; been subjected to test after test without, in many cases, even a letter of non-acceptance from employers. New approaches to the total training needs of young people need to be carefully examined, bearing in mind the future changing requirements in the pattern of trade and industry. The cost of neglecting such training now will be measured in the future in retrospect when the true size of the problem becomes apparent."
The new approach that Mr. Brindson suggests must really be pursued. The last Labour Government—I do not know whether this point has been made this evening—had set themselves a 10-year period for building a programme under which every school leaver was to be given some form of training. Some of our colleagues here were not in the previous Parliament and will not remember these happy facts of our life then.

Ten years, of course, is now quite clearly too long. It is an unacceptable period to subject these young people to. But what do the Conservative Government intend to do? They have not yet pronounced on whether they support Labour's earlier target. I hope that at the end of the debate some hint will be given as to the special attack on this aspect of the problem.

The Government must really review their economic policy, which has made a bad situation in the West Midlands much, much worse, with the strict monetarist straitjacket into which they have tied themselves. They cannot allow this permanently damaging industrial decline to go on. They cannot sit back and unconcernedly watch hundreds of thousands of young people launch out on life with no job and no prospects of a job.

There are—I know a lot of them—reasonable men on the Government Benches; men who are worried about what is happening in our industrial life in Britain. They really must make their arguments heard much more clearly and much more frequently until they get a change of view, until they have battered some better understanding of these and associated problems into the minds of the Secretary of State for Industry, the Chancellor of the Exchequer and, not least, the Prime Minister.

These will be my last phrases, Mr. Speaker, because I can see you looking anxiously at the clock. My colleagues would like me to go on longer, but I have some regard for your wishes. Would it really not help if the reasonable and concerned Tories convinced their Cabinet that one approach to engendering a move out of this encompassing recession would be to follow the path pointed out by Brandt and his colleagues, including the right hon. Member for Sidcup (Mr. Heath)—not the closest colleague of the Prime Minister but an ex-colleague, and a man with a tremendous and impressive reputation? Those gentlemen of the Brandt Commission represent a much greater body of informed, intelligent and concerned opinion than the limited bunch of toadies who now hang around the tartar they have temporarily elevated to the Prime Ministership.

The Government really must examine the possibilities in our present industrial situation of an approach along the Brandt lines, which will not only help our industrial revival but, perhaps even more important, help industrial generation in the Third world which needs this sort of activity even more than we need it.

11 pm

Our debate this evening is especially appropriate. First, it is taking place a few days after the end of the car registration year and on the day when many people in the motor industry are returning to work after their annual holiday. It is also appropriate because it is exactly a year since a similar debate took place on the Consolidated Fund and a little more than a year since the general election. Therefore, it gives us the opportunity to consider what the Government have done during the past year as far as the motor industry is concerned. Above all, this debate is appropriate because the motor industry today faces a crisis that must be almost unprecedented.

During the past year we have seen a catastrophic fall in the car market in Britain. It is now being forecast that 200,000 fewer cars will be sold in the United Kingdom this year than in 1979, and during the first half of this year there was a fall of nearly 16 per cent. in the car market compared with the same period a year ago. Within this shrinking total the proportion of cars made in Britain is also falling. The proportion of imports is rising. It is up from 54 per cent. to 58 per cent. and it is still rising.

There is no compensation from exports for the lost sales at home. I understand that British Leyland's exports of cars are down by about a quarter.

It is a similar story for commercial vehicles. There have been smaller reductions in the sales of vans, but there has been a massive reduction of 20 per cent. in the market for lorries with an increase in imports from 21 per cent. last year to 23 per cent. this year.

The implications for the components industry can be described only as appalling. Every imported vehicle sold in Britain means not only less work for Britain's car manufacturers but less work for Lucas, GKN and Smiths Industries. There is not only the immediate lost sales of the original equipment, as it is called in the industry, but the future lost sales of the replacement parts.

Britain has always enjoyed a favourable balance of trade in components, mainly as a result of selling replacement parts for the vehicles that we have already exported. Now as we are selling fewer and fewer vehicles abroad and buying more and more imported vehicles, so the favourable balance of trade in components is disappearing. Last year our imports of components rose by 30 per cent. and our exports increased by only 10 per cent. At that rate we shall have a deficit in our trade in motor components in 1982 or 1983.

The reaction of the component manufacturers has been to campaign for an end to the exclusive nature of the franchise system. They want to be able to sell spare parts for imported vehicles. We have heard their call endorsed by the hon. Member for Coventry, South-West (Mr. Butcher). We know that their call was endorsed by the Price Commission and we gather that it has the support of the Department of Trade. I hope that the Under-Secretary of State will tell us what effect he calculates such a move would have on the British motor manufacturers. It is well known in the industry that the motor manufacturers make their profits from the sale of spare parts. If we are to attack the exclusive nature of the franchise system, let us know what the potential damage will be to the British manufacturers.

The position is already bad enough for both the motor manufacturers and the component suppliers. A year ago British Leyland employed 160,000 people. Since then we have had the announcement of at least 25,000 redundancies. I disagree with the hon. Member for Bromsgrove and Redditch (Mr. Miller). He said that it was a remarkable achievement of Sir Michael Edwardes that 24,000 people had been made redundant at British Leyland. For my part, I deplore the need for those redundancies. I might accept the description that they are a regrettable necessity, but I cannot accept that they are a remarkable achievement. That is the difference between the parties. I accept that the Government wish to increase productivity. However, they wish to do so by reducing the number of those employed in the motor industry. We would prefer to improve productivity by increasing the number of vehicles produced by the motor industry in general, and by British Leyland in particular.

It is not only those lost jobs. It is also lost job opportunities. I refer particularly to the lost jobs opportunities for young people. My hon. Friend the Member for Warley, East (Mr. Faulds) pointed to the effect of such lost opportunities on the employment prospects of school leavers.

We have had a wave of similar announcements from the component suppliers. Hundreds have been made redundant at Triplex and Wilmot Breeden, and thousands have been made redundant at GKN and Lucas.

During an intervention, the hon. Member for Oxford (Mr. Patten) questioned whether some job losses were due to investment and to new technology. It was not new investment that cost the jobs of the MG workers at Abingdon. It was not new investment or new technology that cost the jobs of those who used to work at Canley. It was not new investment or new technology that cost jobs of the thousands who used to work at Castle Bromwich.

In most cases, the redundancies have been voluntary, but now whole factories are beginning to close. Even when part of the factory can be kept open, and when only some redundancies are declared, one finds that there are no longer enough volunteers. At Lucas they have asked 3,000 people to volunteer for redundancy—that is one in six of the work force—but they are now beginning to talk about having to make those redundancies compulsory.

The reasons for the dramatic decline have been analysed by both sides of the House tonight. I am in greatest sympathy with the analysis made by my hon. Friends the Members for Coventry, North-East (Mr. Park) and for Birmingham, Erdington (Mr. Silverman). I was also struck by the reference to British Leyland made by my right hon. and learned Friend the Member for Warley, West (Mr. Archer). As he said, British Leyland is generally regarded as being small in comparison with our international competitors, and it is getting smaller, so it stands to reason that the company is heading into even greater trouble.

In the motor industry, success breeds success. The higher the sales and the higher the production, the better the productivity, the lower the unit cost and the more competitive the vehicles become. My hon. Friend the Member for Coventry, South-East (Mr. Wilson) described his visit to the Renault factory in France. He pointed out that the firm's advantage did not lie in new equipment. According to his observations, its advantage did not lie in better productivity. What is the secret of Renault's success? From my experience in the motor industry, I suggest that the difference is that the French motor industry has the advantage of a much closer relationship with the French Government than applies in this country. That relationship is expressed not only in terms of money but in other extremely important ways.

Several hon. Members have referred to the world-wide reduction in demand for motor vehicles. That is true, However, it is hardly an adequate explanation of what is happening to the sales and production of British vehicle manufacturers. After all, last year there was a booming market in the United Kingdom for both cars and commercial vehicles. There was a fall in the share of the market held by British manufacturers. Similarly, in the first four months of this year not only Japan but other countries increased both their production and their sales.

The fact is that we have some special problems in this country. They have been admirably summarised by my hon. Friend the Member for Warley, East. First, everyone in the motor industry agrees that the high value of the pound has priced our vehicles out of the export market and made it even more attractive for foreign manufacturers to sell their vehicles in Britain. As my hon. Friend the Member for Coventry, North-East said, during the last year, the profit on each French or German car sold in Britain has doubled. The profit on each Japanese car has quadrupled. That is not the result of anything that they have done to reduce costs but simply because of a change in the exchange rate.

Secondly, there is the inflation rate. We were told a year ago that the Government's monetary policy would reduce the level of inflation. Instead it has doubled. The costs of the British motor industry have risen with it. The hon. Member for Rugby (Mr. Pawsey) intervened to describe the small reduction in inflation as being the result of the Prime Minister's leadership. I must say that in relation to inflation the best description of the Prime Minister is that she is like the noble Duke of York—
"He had ten thousand men,
He marched them up to the top of the hill,
And he marched them down again."
However, we are coming down very slowly.

Thirdly, there are high interest rates. Again they are the result of Government policy. They are fuelling inflation and increasing the costs of manufacturers and also acting as an old-fashioned deflationary factor by reducing the size of the total market.

It is not only these economic factors which are responsible for the crisis in the motor industry. As the hon. Member for Sowerby (Mr. Thompson) said, there is a deliberate decision by the multinational manufacturers to import more and more of the vehicles which they sell in Britain. The Ford company is now the biggest importer of cars into Britain.

One of the main reasons for Ford being one of the biggest importers of cars into this country is the failure of the Ford company in Britain to produce the vehicles which it has the capacity to make.

I said, not that Ford was one of the biggest importers but the biggest importer. It is responsible for more than one-quarter of imported cars in Britain. Ford alone imports more cars into Britain than all the Japanese companies put together. I do not agree with the hon. Member for Birmingham, Northfield (Mr. Cadbury) that that is simply the result of disruption. Reputable newspapers report that Ford recently had 100,000 cars in stock. We do not know whether the figures are accurate, because they are confidential to Ford. However, we do know that last year Ford imported 58,000 Fiestas into Britain. During the first six months of this year the company imported 52,000 Fiestas. It did not do that because of disruption in Britain. Nor do I believe that it is importing Cortinas as a result of disruptions to production.

Ford is importing into Britain for two reasons. First, it has an agreement with the Spanish Government which means that it must export a proportion of its production. Secondly, it has the advantage of the higher exchange rate when importing into Britain. The rise in the exchange rate means that the labour of German car workers is lower in unit cost than that of British car workers. It has nothing to do with wage increases negotiated by the British car workers but everything to do with the exchange rate. Under the Government's policies the exchange rate has risen by 13 per cent. since the general election. The Ford motor company can take advantage of internal pricing and make its profits in that way.

We are in great danger of simply accepting what Ford says about disruption of production. If it is correct, we must examine the reasons. That raises many questions, not all of them about industrial relations.

There are also hidden trade barriers. We have heard about the difficulties encountered by British manufacturers trying to sell vehicles in Japan.

What have often been forgotten in the past are the difficulties experienced in trying to sell British cars and commercial vehicles in the rest of the Common Market. Every other member of the Common Market that has a motor industry also has some unique national type approval. Before a British model can be sold in any of those countries, there is a legal requirement for the British manufacturer to go through a long procedure to obtain approval and to satisfy the authorities in those countries that the British car or commercial vehicle meets their special technical regulations. In some cases, that depends on an entirely subjective test.

Quite apart from the difficulty presented by such regulations, it can take months to obtain approval, simply as a result of bureaucratic delay. The hon. Member for Bromsgrove and Redditch was right to tell the story of delays encountered by British Leyland when it wanted to sell its new truck, the Terrier, in France and the comparative ease with which the French motor industry can launch a new commercial vehicle into this country.

Each country in the Common Market is different and in each country the British manufacturer has to go through a separate procedure. I sometimes wonder that the British motor industry manages to sell as many vehicle as it does in the rest of the Common Market.

The irony is that we do not have anything like a system of national type approval. This country is wide open. It is an importer's dream.

Against the background, what are the Government doing? I am sure that the Minister will remind us, as the hon. Member for Dudley, West (Mr. Blackburn) reminded us, that the Government have agreed to provide £300 million for British Leyland, partly for capital investment and partly to meet the cost of redundancies. That money will benefit not only British Leyland, to the extent that it is used for investment, but the manufacturers of components and all the suppliers of the motor industry.

But what else have the Government done in the past year? As far as I can see, the answer is "Nothing". The hon. Member for Northfield suggested that we should learn from the Japanese and that the British Government should work closely with the British motor industry. I agree with him, but that is exactly what the Government are not doing.

What have the Government done to bring down the exchange rate, to reduce competition from imports and to help our manufacturers to compete abroad? What representations has the Department of Industry made to the Treasury about that problem? Has the Minister even passed to the Treasury the representations that he has received from the industry?

Turning to the multinationals, what has the Department of Industry done to persuade Ford to change its policy and to export instead of importing? Has the Minister asked for a meeting with the managing director of Ford in order to discuss the problem?

What representations have the Government made to the Japanese Government about the increase in the shipments of Japanese vehicles during the past few months? What have the Government done to follow up the representations made by European manufacturers to the European Commission about the problem of the rise in Japanese imports?

What about the hidden barriers in Europe? What discussions are taking place about type approval? I realise that it is primarily the responsibility of the Ministry of Transport, but what discussions have taken place between the Ministry of Transport and the Department of Industry? Does the Under-Secretary of State for Industry know what civil servants in the Ministry of Transport are doing in Brussels while he is in Westminster expressing concern about the level of imports? In short, what is the Government's policy on type approval? Does the Minister want the system of type approval in other countries to be swept away, or would Britain benefit more by following their example and introducing a unique national type approval system in this country? Where is the balance of economic advantage for Britain?

We see no sign of the Government even thinking about these questions, let alone answering them. The Government's policy is one of non-intervention. It is a policy of providing £300 million for British Leyland and sitting back and doing nothing—forgetting that, even though British Leyland is important, it is not the whole of the motor industry and failing to understand that it is precisely because taxpayers' money has been invested in British Leyland that the Government have a responsibility to try to create the market conditions in which both British Leyland and the rest of the British motor industry can succeed and a responsibility to do something to stem the tide of imports, not only in the interests of the motor industry, but in the interests of the country as a whole.

It is as if the Government had provided money for new fire engines and then taken the attitude that it was up to the firemen to fight the fires. What about a little fire prevention? When the fire already has a hold, is it sensible to stand aside and do nothing to stop people from putting fuel on the flames?

For the motor industry of this country, the Government's policy of "do nothing" is a disaster. For thousands of people who depend on the motor industry, the Government's attitude means unemployment.

11.20 pm

This has been an interesting debate. Until the last two speeches, hon. Members had adopted a constructive approach that extended to both sides of the House on a number of issues.

The hon. Member for Birmingham, Stechford (Mr. Davis) is always listened to with respect, but I could not help feeling, as he developed his argument, that there is always the danger, when the Whips are let loose to speak in the House, that they are looking for red meat into which to get their teeth. Some of his arguments tended to move in that direction. In a sense, he showed a little bias in terms of the companies that he selected to discuss. I shall come back to some of the questions that he raised, but I do not wish to equate his views to his past except to say that a lot of the arguments that he proposed are valid. I should like to examine them in more detail in a moment,

With the exceptions I have mentioned, the arguments have been well balanced. It would not, perhaps, be unfair to say to the hon. Member for Warley, East (Mr. Faulds), who, as he explained, has not been able to be with us, that some of his comments were part of his general purpose speech and did not quite fit in with the theme that has been developed in the debate.

The hon. Member for Coventry, North-East (Mr. Park), in his usual statesmanlike way, looked at the matter in the widest international perspective. That theme was picked up by my hon. Friend the Member for Coventry, South-West (Mr. Butcher), and also by my hon. Friend the Member for Birmingham, Northfield (Mr. Cadbury), who demonstrated that his industrial experience is relevant to our proceedings.

The Government are well aware of the industry's difficulties. The fact that tonight's speeches have been made by hon. Members representing the West Midlands does not reflect a parochial view of the matter. A whole spectrum of views has been heard, covering all the major car manufacturing countries and much of the trading policies of the Government and previous Governments. Hon. Members have demonstrated that they are adopting a wide and international approach.

This country is not alone in facing motor industry problems. The only country that does not have similar problems is Japan. In terms of the world recession and its impact, one recognises the degree of difficulty facing a number of Western economies. The energy cost element and the degree of the usage of cars will perhaps be traced through future years by economists. Many of these key difficulties are reflected in this vital, internationally competitive manufacturing industry.

We have been speaking of an industry which is international and competitive and one in which there is a limit to the amount of subsidy that can be poured in compared with other countries. Such a route is not only self-defeating but postpones the evil day for many of the basic decisions that must be taken within such industries.

Many hon. Members, including the hon. Member for Coventry, North-East and the hon. Member for Birmingham, Erdington (Mr. Silverman), were anxious to raise the question of the sterling rate of exchange, interest rates and inflation itself. I shall not reiterate all the arguments. It is only right, however, to make the point that to try to rig the exchange rate—that kind of artificial activity—would be inflationary in the extreme and would fuel the problem we have been discussing.

The Government are anxious to see interest rates continue in a downward direction, but, again, premature movement would fuel inflation. The fact that inflation has begun to reach a peak and that in the next few months, partly for technical reasons, we shall see a move in that direction means that we are moving towards the winter wage negotiations with a possibility—I put it no higher than that—of an inflation rate which is continuing to move downwards.

In that situation, I hope that all hon. Members will use their influence to ensure that this argument is carried through in the wage round. I recognise and pay tribute, however, to the fact that restraint has generally been a feature of the industry and has been part of the way in which some opportunities for reversing past trends have become apparent.

Many hon. Members dealt with Imports. The Government attach the greatest importance to the continuation of voluntary restraint agreement. A number of hon. Members who have been to Japan know that this problem is well understood there. We have still to work on the problems, but, on the statistical pattern, the market share for Japanese car imports this year remains below 11 per cent.—in line with recent years.

As has been said, in the last few months, there has been a relatively high rate. The question is whether that rate, or the 11 per cent. rate itself, will be maintained. I shall pass on the thrust of the argument tonight to my right hon. Friend the Secretary of State for Trade, who carries much of the heat and burden of the day in this matter. But I would ask hon. Members to consider a little more widely than perhaps some were prepared to do tonight the future relationship with the Japanese car industry.

In the BL-Honda tie-up, to which the Government have given their blessing, one sees the attractions of inward Japanese investment. The suggestion that up to 50 per cent. of that car will be made from British components is part of the answer to some of the component problems raised tonight. One should beware of taking too narrow a view in this debate. This may be a way in which the balance can be reversed. While in no way selling short the argument about our difficulties in reciprocal trade and our determination to facilitate it, those wider aspects should also be borne in mind.

I am fully aware of the trading imbalance with Spain, which cannot be defended on any grounds. However, as my hon. Friend the Member for Bromsgrove (Mr. Miller), who plays such a notable part in all our debates on the motor industry, pointed out, this is one of the key issues on which we would expect further satisfaction in the context of Spanish accession to the Community.

On the question of Eastern Europe too, the Government are anxious to act wherever there is evidence of dumping, but, beside the problems that we are discussing, this is a smaller one. Import penetration of less than 2 per cent. is difficult to represent as substantial damage.

Hon. Members have asked for the reasons for the assistance given to Dunlop and how the deciison related to the Government's policy. The reason that £6·1 million has been agreed under the Industry Act is to help Dunlop rationalise and modernise some parts of its car operations. I am confident that this will play its part in improving the company's efficiency in Birmingham, and in the North-East. That fits squarely with the Prime Minister's view, expressed in the House only last week, that we are always prepared to help in the transition to higher productivity and more jobs.

Is it not a fact that this proposition for the financing of new plant in Erdington was put forward to the previous Government and that they suggested as a condition that if they advanced this quantity of money perhaps they should have some equity in the company in compensation?

I cannot speak for the previous Government, so I cannot confirm the basis on which the hon. Gentleman puts the argument. He will want to develop that argument on another occasion, because I dare say that he was privy to any such discussions that may have taken place at that time. All I say is that, so far as the present Government are concerned, our interest here is in schemes which improve efficiency and which are geared effectively to higher productivity and more jobs.

One of the interesting aspects to this particular agreement—and this picks up the hon. Gentleman's point—is that the scheme was given the backing and support of the independent Industrial Development Advisory Board, to which the Government look in these matters. So, in that situation, if schemes of this kind can be found, the Government have shown their willingness to help.

Do I understand from my hon. Friend's remarks that this scheme is still open to other applications meeting those criteria, and that it has not been cut off?

As I was explaining, under sections 7 and 8 of the Industry Act, which are applicable to this agreement, there is no reason why applications cannot be considered. Of course, it would depend on the take-up of funds at that time; but I would not want to rule out other opportunities if they can be met within existing resources.

My hon. Friend the Member for Northfield and others raised a very important point on the question of vans and four-wheel-drive vehicles from Japan. This is an important question to which perhaps less attention has been paid than to the normal question of car imports. I share concern about the volume of such imports. My right hon. Friend the Secretary of State for Trade is keeping a very close watch on this matter. But import penetration overall in commercial vehicles is much lower, at about 20 to 25 per cent. Nevertheless, this is an area which requires careful attention. Again, though, we must look at it in perspective, because Land-Rover sales in the United Kingdom continue to rise as well. I am glad to welcome that. Also. BL is investing over £200 million to double Land-Rover production. I take the point that my hon. Friend put to me. I shall take an early opportunity of passing it on.

The hon. Member for Stechford raised another general question on the subject of commercial vehicle type approval. This problem is well understood. Although it is outside my Department's area of responsibility, we have naturally been in close consultation. My right hon. Friend the Minister of Transport is giving urgent thought to this matter. He is fully aware of representations from the industry, as we are. Because this matter is being looked at urgently, I shall take an opportunity to reinforce the arguments that have been made and pass on to my right hon. Friend the views that have been expressed here tonight.

The hon. Member for Stechford also raised the question of the franchise system for car parts, which again falls within the responsibility of my right hon. Friend the Minister for Consumer Affairs in the Department of Trade. She is well aware of the problem and has asked the Director General of Fair Trading to make a full examination. As the hon. Gentleman is well aware, there is here a need to balance the interests of car manufacturers and the components industry in trying to break into replacement parts markets.

As I have said, a number of the issues raised tonight have been of a consistent kind and of a genuine nature in the problems they have brought out. Inevitably, much of the present Government's effort has been directed towards BL, the company with which, in a departmental sense, I have to concern myself. I add my tribute to those which have been expressed earlier about the progress which has been made in terms of improved industrial relations and the way in which the company has sought to move back into the market place. But, as I listened to hon. Gentlemen tonight, I could not help thinking that perhaps over many years all of us have been a bit too ready to look at some of the problems, to think of solutions and to look to the Government for help without recognising the years that the locusts have eaten.

Many Members will recall the postwar years when demand was high, when the problems then apparent were not tackled on all sides of the industry. It is easy to say that with hindsight. The right hon. and learned Member for War-ley, West (Mr. Archer) said that it was no good apportioning blame, and I agree. I raise the matter only to say that consideration of the problems of the past may guide us for the future.

One aspect of the import problem that was not brought out in the debate was that many of our own consumers—indeed, many of our own workers in these very industries—demonstrate their preference by choosing a design from another country. That design aspect is very important.

In servicing, we must recognise that over the years, for a number of reasons, our industry has suffered in comparison with our competitors.

There is much to be done within the industry. All hon. Members know in their hearts that that is true, but in the usual late-night attempt to see what they can do to twist the Government's tail they tend to play that down.

However, I suspect that in the spirit in which the debate has been conducted these are matters on which we can make common cause. We all have at heart the future of this great industry. In my view, it must be maintained and must thrive. We have a great and pioneering tradition, and we still have a number of great successes. If in concluding I relate a few of those, it is because, despite all the problems, we should remind ourselves that there are matters that give us encouragement for the future.

For example, there is the investment of £285 million in the new Metro at Longbridge. That is a key matter, and we wish the project successes. There is also the investment in the new Road-train truck and the new assembly hall at Leyland, the plans at Solihull to double Land-Rover production, and the BL-Honda development, to which the Government have given their agreement in principle. That brings forward a new model; it does not simply introduce a stopgap.

The hon. Member for Stechford was a little unfair in singling out Ford for his criticism. It is true that as part of its European policy Ford has gone in for importing from one European country to another, but, as the hon. Gentleman well knows, with the Bridgend engine plant, which is now on stream, there will be an opportunity for all Escort engines for the whole of Europe to be supplied from this country. If one followed the logic of the hon. Gentleman's argument, Ford would be forced back into a fortress-type activity, with each country insisting that the company did every little piece within its own frontiers. It is a different strategy. I have given a good example of where it works to our advantage. After all, in a four-year investment programme, now almost complete, Ford has spent almost £1 billion.

The components industry is still producing an excellent export record—an £800 million surplus on the balance of payments last year. For example, Lucas is providing all General Motors' requirements for diesel fuel injectors.

Those are some of the success stories. It is right that they should be mentioned to balance some of the problems that hon. Members have inevitably concentrated on tonight.

I certainly am not complacent about the future of the industry or the challenge that it poses for management and work force. Questions of demarcation disputes were raised. This is a Nita] matter. Hon. Members recognise that at a time of changing technology we must do all we can to encourage and facilitate the process of change. We in the Government are determined to do our part. The task has been made a little easier and a little more rational by the debate.

Family Planning Groups

11.38 pm

There are several groups in Parliament that not only transcend party barriers but leap the gap between this House and another place. I am the chairman of one such group, the all-party Lords and Commons family and child protection group. The group receives information and complaints from parents, teachers and other interested persons covering a very wide area.

The information that we have received has led us to be greatly concerned about some of the activities of the Family Planning Association and other bodies that are funded by public money to a great degree.

I hope that it will be universally agreed that Parliament must accept its responsibility to all taxpayers to expend their money wisely and justly. The taxpayers have no alternative but to pay. It is a bitter thing to be forced to contribute money which is being used to break the law of the land and to weaken family ties and debase children.

I am sure that some of the activities of the FPA are carried out by people who are both worthy and well meaning and that sections of the FPA do a good job. I entirely agree with contraception and am all for fostering responsible attitudes to parenthood and sex. Adults run their lives as they wish, and the FPA has helped many of them. I make no complaint whatever about that.

But the FPA has moved very far from its original activities, and a large proportion of its efforts are now directed towards the young. When little children, far under the age of consent, are encouraged to go on the pill, told that ideals are outdated, given contraceptives of all kinds, and when parents are deliberately denied their right to know what is going on, and when all of this is done with public money, the time has come for the strongest complaints to be made to responsible Ministers.

A father in the West Country complained to the Family and Child Protection Group last month that at his daughter's school there had been a visit of doctors from the Brook Clinic and the FPA on a sex education day course. First, a speaker from the family life association spoke about adult relationships, about love and marriage and the dangers of illicit sex. Then a doctor from the Brook Clinic spoke on contraceptives, and all kinds of contraceptives were not only discussed but examined.

Then—and here came the real mischief—the girls were divided into groups, the teachers were not present, and the FPA workers spoke to them. The children were asked what they had already been told on this subject—the question of sex and illicit relationships. The FPA worker sneered at ideals and almost said that ideals were things that one could not possibly live up to and should not try. The father of the child who wrote to the group about the matter wrote one sentence which, I feel, is most apposite. He said:
"I feel that education is about excellence and high standards and not about expedients and conformity with the short-sighted and weak."

Does not my hon. Friend agree that when such matters are to be discussed in our schools parents should have the right to know beforehand about the type of instruction which is proposed? Does she not further agree that parents should have the absolute right to withdraw their children from such classes if they feel that it would have long term ill-effects, or any ill-effects, for that matter?

I very much agree with my hon. Friend. I shall, if I may, in the interests of keeping within the bounds of the debate, speak on the subject of the DHSS and the funds which it donates to these bodies, although what my hon. Friend has said is correct, within the context of schools.

My point is that these activities should not be funded by public money given by the DHSS. We have had many such cases. A 15-year-old girl in Ipswich earlier this year caught VD after some time on the pill. She had secret medical treatment at first because she was too ashamed to tell her parents, who finally found a VD clinic card in her room. Imagine the effect of that on responsible parents. The FPA had given the girl contraceptives which are no protection whatever against VD. Her doctor was not told, nor were her parents. The whole operation was funded by public money.

I know of the case of a girl of 13 who was also given contraceptives by a local family planning clinic. At that time she had not had sexual relations, but within a short time of receiving the contraceptives she had had sexual relations with 10 or 12 different boys within a fortnight. The situtation was so bad that the child could not go to school. The point that we should consider is that these children are really too young. They are not mature enough to handle the problems which this kind of behaviour brings on. The girl was in utter despair when she was placed in that predicament, though the help given to her was no doubt given with well meaning intentions. Nevertheless, it was a terrible predicament and eventually the whole family had to move because it was impossible to remain in the same house.

There are dozens of such cases, and when parents complain to the local education authority, or to the DHSS, their complaints tend to be shuffled from one desk to another and from one official to another. They feel a sense of angry frustration, particularly at the fact that their own money is being used to do that to their children.

The Family Planning Information Service is a Government-sponsored and publicly funded body administered by the Health Education Council for which the position of director-general was recently advertised at a salary of about £20,000 a year. We are, therefore, paying people large sums of money. The Health Education Council, run by highly paid officials, has done some extremely dubious things and backed some quite disgraceful publications.

The Family Planning Information Service is also administered through the Health Education Council and the FPA. This service receives £155,000 per annum to promote birth control facilities and services. The DHSS also grants £55,000 per annum to the FPA for its regional centres, though that sum is currently under review.

Bearing in mind some at least of the things that these large sums of money are used for, the amount should be cut for the following reasons. First, we are experiencing a time of severe financial stringency and there can be no excuse for spending public money unless the cause is just and right. Secondly, it should be cut because the FPA is in part a highly lucrative business, having its own contraceptive mail order business called Family Planning and Sales Ltd. That business covenants its surplus back to the FPA, and those surplus profits are neither small nor static.

In the early 1970s there was a mere £10,000 per annum profit. The figure for 1978–79 given in the annual report of the FPA for that year was no less than £116,000. In eight years, profits increased from £10,000 to £116,000. In 1975 the FPA made arrangements with the DHSS for Family Planning Sales Ltd. to market a contraceptive wholesaling service to area health authorities taking over FPA clinics.

A Monopolies and Mergers Commission report for 1975 contained a comment from the trade that the FPA's education activities were a good means of widening the market for contraceptives. Are these the people who should be teaching children and training teachers to help other children to ask for the goods which they supply and sell?

It is totally wrong for groups with vested interests in the sale of contraceptives to give sex education, or advice, to children, and for Parliament to compound the evil by doling out scarce Government funds to bump up the profits of those groups is grave mismanagement by the DHSS.

There are other reasons why the money should be cut. First, when these items are given to children there is no protection against venereal disease. It is a terrible thing that we are giving children items paid for by Government money which can give them a nasty and dangerous disease.

There is then the question of cancer of the cervix. It is not often raised. Recently a medical report confirmed that early and frequent sexual activity was very likely to bring about this form of cancer. Are we giving an antidote to teenage pregnancy? A lot of well-meaning people believe that that is why it is right to give these items to children. Yet statistics show that the greater the availability of contraceptives to youngsters, the greater the promiscuity and the more abortions there are. What in heaven's name are we doing to our children?

Many of these children are well under the age of consent. How does Parliament view the fact that it is providing public money to break the law? We should make no mistake about it. It is illegal for a man to have sexual relations with a child under the age of consent. Yet these clinics are constantly doling out these items which must inevitably lead to the breaking of that law. I cannot think that it is right that public money should be used to flout the law in this way.

There is no doubt that the authority of the family is gravely weakened when the parents are not told and not allowed to be told that their children are receiving these items. One parent I know went to a family planning clinic to complain. The parent asked the direct question: "Have you given these things to my daughter? She is only 12 years old." She was told "It is no business of yours." That cannot be right, and without question it weakens the authority of the family. As my hon. Friend the Minister well knows, the Government are pledged to strengthen, not weaken, family life.

I end with criticisms of the FPA which have been put before my committee, all of which are important and none of which is long. One person wrote:
"The FPA is no longer an association to help plan a family but rather to advocate sex at any age."
A doctor wrote:
"As a doctor interested in family planning and the health of schoolchildren I valued the humanity and integrity of the FPA up to about 10 years ago when it changed its leadership and style to a brash and insensitive utilitarian publicity image. The fact that the present FPA no longer has clinical doctors or nurses in its employ means that their professional ethics are no longer a stabilising force."
That is a point on which the House should ponder. The letter continues:
"The present FPA's publicity methods … not only consist of arrogant attacks on anyone who disagrees with them, but also produce misleading information for young people and a constant denigration of pregnancy as either an inconvenience or dangerous.
The mental, emotional and physical health of children is too important to be manipulated by the present FPA's educators, who appear to be using sociological theories in order to break down individuality and personal morality."
The final letter states
"I think that the Department of Education should know that normal parents like me and others do not want the FPA to have anything to do with educating our children in sexual matters."
Above all, I make the following point for my hon. Friend. He has been most kind in his attention to the representations that my group and others have made to him. He is well aware of the public concern about this matter, of what is happening and of the fact that public money is being used to allow it and to encourage it to happen. I hope that he will be able to tell the House that his Department will be able to look sympathetically on these representations.

11.54 pm

This is part of a concerted attack on the principal family planning charities—the Family Planning Association and the Brook advisory centres. I can cite examples of the campaign over the past several months inside and outside the House, such as the comments of the hon. Member for Halesowen and Stourbridge (Mr. Stokes) on 14 May, as reported in columns 1516–19 of Hansard. There was an article by Mrs. Valerie Riches, the secretary of an organisation called the Responsible Society, in The Daily Telegraph on 13 March. There were two articles by Ronald Butt in The Times on 14 and 28 February. In late 1979 Mrs. Victoria Gillick, who belongs to the Family and Child Protection Group, applied to the Charity Commission to have the FPA struck off the register of charities. The commission rejected the charges made.

The allegations against the charities have to some extent been listed by the hon. Member for Birmingham, Edgbaston (Mrs. Knight), who I am sure will have headlines in some newspapers tomorrow. It is significant that she has not given names, addresses or identification. It is intolerable to make general and extremely damaging charges without firm evidence. This is not the first time that the hon. Lady has been guilty of that offence.

One allegation is that the two charities are undermining sexual morality by increasing knowledge of contraception and sexuality. That is a specious charge which ignores the social changes that are far more responsible for changing attitudes to sex. The attitude of the press, BBC and television companies, the earlier maturity of youngsters, their more enlightened education and parental attitudes, shape the moral climate in which we live. The charities seek only to recognise and respond to those changes. They are in no way responsible for them.

The short-term priority of the charities is to prevent unwanted pregnancies. In the long-term they aim to teach responsibility in personal relationships and sexual behaviour. Their motives are highly respectable. They are controlled by highly respectable citizens, many of whom I know personally.

The second allegation is that the charities incite promiscuity by giving information about contraception without adjuring young people to preserve their virginity. However, the youngsters who attend the advisory clinics are already sexually active and would be sexually active regardless of whether the charities existed. It is silly and short-sighted to ignore that fact or to pretend that it will go away or be more easily resolved if these charities do not exist.

The third charge is that the charities undermine the family as an institution. What an absurdity. That is an extremely vague charge which is incapable of proof. The assertion is made and it is assumed that it is self-evident.

Does the hon. Gentleman agree that a girl of 12 or 13 years of age, in the situation that we are discussing, emotionally, physically and spiritually would require the help of her parents? Does not the hon. Gentleman believe that the parents should be informed in order that they may comfort their own child?

Absolutely. I shall come to the relationship between a child and its parents. That relationship is not always close and intimate. Often the child does not want the parents to know. It is an extremely difficult social problem. The charities behave in a most responsible way in advising those children to talk over these matters with their parents. They do not act unilaterally.

I am sorry, but I have much to say. I am determined to defend these charities as very desirable institutions which should be preserved and supported by the Government.

Far from these organisations destroying or undermining the family as an institution, family planning over the years has helped to improve family life by educating couples in the ways of planning and controlling the size and age structure of their families.

I am coming to the children. I shall not run away from any of the problems. It is important to attack with vehemence the charges which have been made against the charities.

The fourth charge is that family planning denies parents their rights. In fact, the opposite is true. The charities do all that they can to encourage children under age to discuss their problems with their parents. But in cases of conflict between children and their parents—and they do arise—the doctors can prescribe contraceptives to prevent unwanted pregnancies Would the hon. Member for Edgbaston prefer a 12- or 14-year-old not to go to a clinic and to have a pregnancy and a child at that age?

No. The hon. Gentleman may make his own speech in his own way. It is important to put on record the fact that too few parents discuss sex problems with their children.

In 1978 a study made by Mr. C. Farrell, entitled "My Mother Said", published by Routledge and Kegan Paul Ltd., showed that 7 per cent. of the boys and 17 per cent. of the girls interviewed had discussed these matters with their parents. Therefore, it is idle to presume that parents are playing their part in these matters, as they should be.

The fifth charge that is made against the charities is that they do not give proper warning of the risks of contraception and of sexual intercourse. The point to be made here is that there is no general consensus as to the extent of such risks and dangers. But the charities play their part, and do their utmost, to educate, advise and warn everyone who goes to them. But not even the most comprehensive education, the most skilful advice or the direst warnings will suppress the sexual instincts of human beings. That is a fact that we had all better face. Those instincts have been about for a long time, and they are here to stay, thank God. Whether or not the charities exist, those instincts will be satisfied and often abused. The charities do a magnificent job in eradicating or reducing as far as humanly possible the risks and dangers involved.

The sixth charge made against the charities is that the Family Planning Association exists—the hon. Lady made this point—to increase the profits of its sales company, Family Planning Sales Ltd. She quoted figures which I took down. She said that in 1978–79 it made a profit of £116,000. The fact is that the company concerned covenants all its profits to the FPA's charitable funds and contributes a good proportion of the FPA's budget—about £100,000 out of a national total of about £550,000 in 1980. There is no profit to any individual at all associated with that company.

Indeed, it is not unlike the sales companies run by many national charities. Dr. Barnardo's runs it own companies to raise money for its own purposes. The Boy Scouts Association runs its own company selling camp equipment and all kinds of stuff associated with the Boy Scouts. That practice is in line with the Government's advice—indeed, the Government's admonition—that charities must increase their charitable funds from other sources in order to reduce their dependence on State funds. No director of Family Planning Sales Ltd. receives any salary, except its managing director, who is a retired chemist. That answers one of the other charges that the hon. Lady made.

The seventh charge was made when the application was made to the Charity Commission to suspend the registration of the Family Planning Association. The claim was that the charities are political pressure groups seeking to influence the Government's policy in family planning. Even assuming it was, the FPA is not the only organisation seeking to pressure the Government in those directions. The Roman Catholic Church is a very important pressure group that is never afraid to exercise its influence—quite legitimately, in my view—to put pressure on the Government in certain directions. Therefore, there is nothing in that. But that view, in so far as it was a credible one, was rejected by the Charity Commissioners and, I think, by the Department of Health and Social Security, too.

I turn to the work done by these charities. The FPA has a national office in London and 11 regional offices, including one each in Scotland, Wales and Northern Ireland. It operates a family planning information service for the DHSS. It is funded via the Health Education Council, and had a £150,000 budget in 1979.

The FPIS distributes a range of over 40 leaflets and other literature to health authorities, with the knowledge, I presume, of the Department, which will not allow these things to go out without carefully vetting their legality. It publishes a quarterly bulletin called "Family Planning Today", which is sent to all National Health Service family planning doctors and staff throughout Britain. It also runs a personal advice service, answering about 100,000 postal and telephone inquiries per year, which is a fair indication of the demand there is for this kind of service.

The 11 regional offices do parallel work, and they are funded as to 50 per cent. by the DHSS, the Scottish, Welsh and Northern Ireland Offices. That—subject to correction—amounts to about £69,000. As far as I know, the figure for 1979 was £69,000 to £70,000. The other 50 per cent. was from the charitable funds of the FPA.

The FPA also has its own educational unit, which provides courses throughout the country, on personal relationships and sex education, for social workers, youth workers, workers with the handicapped, teachers, health visitors and the rest. Those courses are funded wholly from the FPA's charitable funds and course fees.

The FPA also has its own medical advisory panel, serviced by a medical department, in its London office, all funded entirely from FPA charitable moneys. In fact, the FPA ran most of the 1,800 family planning clinics in the country until they were handed over to the area health authorities in the reorganisation of the National Health Service in 1974. But it still has 23 private clinics, providing mostly vasectomy services where the Health Service is unable to satisfy the demand for that service.

The FPA also runs and provides offices for the organisation called Population Concern, which is a fund-raising organisation for family planning programmes in the Third world. That is a very important service and the Minister will not underrate its importance. In 1979 it raised about £100,000 in Britain for those purposes.

I turn to the other charity under attack, the Brook advisory centres. In parenthesis, I point out that, until he became a Minister, the present Solicitor-General for Scotland—an admirable man, a very responsible citizen and a Queen's Counsel of the highest calibre—was one of the directors of the Brook organisation. He would not undertake that kind of work with an organisation which, as the hon. Lady alleges, breaks the law. It is an amazing charge to make—that a Law Officer of the Crown belonged to an organisation which the hon. Lady says is breaking the law. I do not believe it.

The Brook advisory centre runs 15 clinics for young people in several cities, and 60,000 young people a year get advice from the Brook. I do not know where the hon. Lady has gone. I suspect that she has gone to the BBC, or somewhere like that, to make her charges there.

The Brook advisory centres are 15 clinics throughout the country. They are financed by area health authorities and charitable donations. The national office in London is supported by a DHSS grant of £21,000 a year, which is less than half the organisation's budget. The rest of the budget is obtained from charitable funds.

The value of the work of the Family Planning Association and the Brook advisory clinics is widely acknowledged by many authoritative and responsible bodies—for example, by the Royal College of Obstetricians and Gynaecologists in its report "Unplanned Pregnancy" of 1972, by the 1969 article by Thomson and Illsley entitled "Family Growth in Aberdeen", reported in the Journal of Bio-Social Science, by the Scottish Standing Medical Advisory Committee in 1971 in a report entitled "The Battered Child" and by numerous other organisations and individuals. There is little doubt anywhere that the two charities are providing much-needed and much-valued services.

Repeated studies have demonstrated beyond doubt that the provision of family planning services and education associated with that planning result in enormous benefits in terms of health, social well-being, family finances, housing conditions, marital happiness and security. I do not think that there is an authoritive body anywhere that would deny those claims for these organisations. In the present climate of financial stringency, the charities fulfil needs that are unlikely in the foreseeable future to be met satisfactorily in any other way. The Government have gone out of their way to emphasise the importance of extending voluntary work in this and other areas.

The use of statistics can be dangerous and misleading, but I shall put one or two facts on the record. I think that it is a recognised fact that today large unplanned families, with consequential poverty and drudgery, are thankfully very rare. There might be some hon. Members and some outside who disagree with that concept. However, a large part of poverty the world over, poverty and drudgery in large measure, results from unplanned and very large families. That cannot be denied by anybody other than some who have religious prejudices in another direction.

Another fact is undeniable. Births to teenage girls have dropped dramatically. I am not saying that that has happened as a direct consequence of these charities. However, they have contributed in some measure to that fact. In 1971. 51 out of every 1,000 girls aged 15 to 19 gave birth. In 1978, only seven years later, the figure was down to 30 per 1,000.

The shotgun marriages, where the girl is pregnant before she is married, have been reduced to about a quarter of the rate of 10 years ago. In addition, such charities have benefited the population. In 1969, the number of births in Britain exceeded the number of deaths by 100,000. During the past four years, the birth rate has decreased, and is now about the same as the death rate.

Charities are only one factor, but they are important and cannot be ignored. The Government wish to encourage voluntary bodies and charitable organisations to extend their fund-raising efforts. They wish to reduce the burden on the State-provided services. It would be the height of economic and social absurdity, and it would be indefensible, to treat such charities as pariahs, to be singled out for punishment because of the prejudices of a tiny and unrepresentative minority.

I hope that the Government will resist the blandishments of the hon. Member for Edgbaston. This will not be the last that they hear of this issue. I suspect that Conservative Members will agree that the charities are doing noble and valuable work, which should be encouraged.

12.21 am

The question lying behind the debate is simple: do the Family Planning Association, the Brook advisory centres and other family planning charities encourage a lowering of moral standards, or do they simply cope with the consequences of a lower standard of sexual morality, which in turn has several causes? I have little doubt that the charities meet the consequences of a lower standard of sexual morality.

My hon. Friend the Member for Birmingham, Edgbaston (Mrs. Knight) praised the general work of the family planning charities. The hon. Member for Fife-Central (Mr. Hamilton) was unfair to my hon. Friend in that regard. However, she then pinpointed a particular aspect of their work and said that she had serious doubts about it. She said that a large part of the activities of such organisations was directed towards the young. That is true. In a perfect world that would not be necessary. Unfortunately, as we know only too well, we do not live in such a world. It is not the family planning movement that has changed the standards of sexual morality but the other pressures that have been placed, in particular, on the young. I refer to the pressures imposed by the press, television, the media in general, and by advertising.

Contrary to the opinion expressed by my hon. Friend, I believe that family planning organisations try to deal with the problems that have arisen as a result of the pressure that is put on the young by modern forms of communication. The hon. Member for Fife, Central mentioned several of the criticisms that have been aimed at the family planning organisations. He defended such organisations against such allegations.

It is important to emphasise that the organisations encourage young people to discuss sexual matters with their parents. However, we must accept that often the ability of children—and some are not much more than children—to discuss such matters with their parents is virtually nil. I wish it were otherwise. We must accept that we are dealing with a practical problem and not an ideal situation. The family planning charities are filling a gap. If they did not exist to help cope with young people's problems, the situation would be far worse and there would be many more unwanted pregnancies.

The hon. Member for Fife, Central also referred to the allegation against the Family Planning Association that it attempts to increase the profits of its sales company to line the pockets of those involved. I remind the House that that sales company covenants all its profits to the association's charitable funds.

My hon. Friend will recall that that is exactly what I said. My point was that with such large profits it was debatable whether public money should be used.

I shall take that up later. Governments have encouraged charities to establish separate companies which can raise money to subsidise the charities. I am involved in a charity which in the last two months set up a sales company whose profits will be ploughed into the charity—a research and advisory organisation. In principle, there is nothing against that.

The Government have said that they wish voluntary organisations to raise money in that manner to be used by the charity in addition to the money provided from central Government. Of course, it would be possible for the family planning organisations to operate without Government subventions, but their work would be limited. As a result they would be much less capable of carrying out the role which society asks them to perform.

I believe that these organisations do a good job and that they fulfil an important role. On the other hand, it must be accepted that they are constantly prone to criticism because they work in a delicate and difficult area. No one can deny that, and the fact that there is occasionally a debate such as this, when the services are subject to some criticism, will emphasise to them how careful they must be. I believe that they have set a high standard and that it is their intention to maintain that standard. The money allocated to them by the Government is well spent and is put to excellent use.

12.30 am

I listened carefully to the debate and I am well aware of the general concern felt in the House on this subject. I am grateful to my hon. Friend the Member for Birmingham, Edgbaston (Mrs. Knight) for raising the subject, because it is an important one and, as she said, it concerns parents and families and family stability. We all appreciate my hon. Friend's deep concern on those matters and how much she has done to help families, and we also appreciate her sincere feelings on these issues. She will know that much of my medical work was spent trying to help families and particularly young people. I also care deeply about these matters I listened carefully to my hon. Friend's comments, some of which were serious.

The Government are pledged to support and strengthen family life. Listening to my hon. Friend, I found myself asking questions that were also posed by the hon. Member for Fife, Central (Mr. Hamilton) and my hon. Friend the Member for Devizes (Mr. Morrison). To what extent does a family planning service contribute, for many couples, to the happiness and stability of the family? To what extent does it help them to accept parental and family responsibilities? Those are fundamental and important questions. Are the services really contributing to the integration of family life, or are they, as has been suggested, leading young people into promiscuity and abnormal behaviour?

The answer is that a family planning service gives a choice to families and enables them to decide rationally the size of the family and the timing. We know that the sensible timing and spacing of children can mean better health for both the mother and the child. It can mean a more stable family life, and it can reduce the number of perinatal deaths. Those are important positive gains.

One can also, of course, look at what happens in large families such as those referred to by the hon. Member for Fife, Central, where the mother is unable to cope, there is a break-up in the family, an inability of the parents and child to talk and a high incidence of child abuse or baby battering.

We have given great thought to whether the family planning service should continue to be funded to the extent that it has been by the Government and whether it should continue to be a free service. It is a difficult question. I remember the discussions that my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) had when he was Secretary of State for Social Services and in which I took part. He decided that family planning should remain a free service and that no one should be prevented from using the service by inability to pay.

Looking at the matter afresh, we have decided that it is right to continue the family planning service as a free service, despite the economic difficulties of the country.

I listened with great interest to the figures given by the hon. Member for Fife, Central. They are not the figures I possess. I will look into the matter carefully. I shall not go into detail about my figures, although I can supply them in a parliamentary answer if the House so wishes. Sadly, despite all the efforts that have been made, the total of illegitimate births, after falling for some years, is now rising again. The number is now 0·7 per 1,000 girls aged under 16, or about 1,400 births a year.

I am sorry also to have to tell the House that the abortion figures are rising again. I have the figures for the past 10 years. In the first six months of this year, compared with last year, abortions have increased from 73,343 to 82,624. They have increased by 10·1 per cent. in the National Health Service sector and by 14·2 per cent. in the private sector. This is a worrying trend. It is a matter of great concern. I suggest to the House that it makes the provision of adequate family planning all the more important.

Despite what my hon. Friend says, and despite the funds being made available, the incidence of abortion is increasing. The two matters do not match. On the one hand, funds are being ploughed in, but, on the other, there is an increase in abortion. Surely the argument is that more should be done to educate young people on the principle of general morality rather than providing artificial aids, a policy that manifestly is not working as illustrated by the incidence of abortion.

I am grateful to my hon. Friend. As he will know, there are many different factors. Whereas the figures have been falling in recent years, they are now showing the most alarming signs of increasing. It is a matter of great concern.

The hon. Member for Fife, Central, referred to the reduction in the number of shotgun marriages. He is right in saying that the number has gone down, although not to the extent, I suggest, that he gave. My figures show that, whereas in 1970 there were 26·6 per 1,000 women, the figure had fallen to 11·5 by 1979. This is not the fall to a quarter, as he suggested, but it is right to say that there has been a fall.

The Government thought it right at this stage to continue a free family planning service and to continue to support reputable voluntary organisations working in this sphere. We have already heard a good deal about the amount of money that the Government have been spending on everyone's behalf. The largest contribution last year was made to the Family Planning Information Service via the Health Education Council. The amount was £155,000. This provides a telephone advice service and widely circulated information leaflets. A number of hon. Members have sent me copies of various leaflets. I should like to return to this matter, because it is important to deal with leaflets sent out today and not necessarily those sent out a few years ago.

The Government also support the regional work of the Family Planning Association. In 1979, this support amounted to just under £69,000. The Family Planning Association has asked that the amount should be increased. This year, my right hon. Friend has agreed to an increase to £120,000. There are also Family Planning Association courses for professional people, the Brook advisory centres, which receive £21,000, the Catholic Marriage Advisory Council, which gives advice on natural, if I can call it that, family planning methods, which also receives £21,000, and the National Association for the Childless, which receives £10,000. So at the moment there are direct grants of about £170,000 and indirect grants of about £200,000 a year, in addition to the overall cost of the statutory National Health Service provision.

I realise that some of this work is highly controversial and that some people sincerely feel that the very availability of contraceptive advice can cause promiscuity and the erosion of ethical values. My hon. Friend the Member for Edgbaston has been clear in her view that this is so. That is a matter of great concern to us.

I agree also with my hon. Friend that guidance is best given, and must be given wherever possible, within the family, by loving parents. Most parents gladly accept and undertake this duty. But, as my hon. Friend will realise, there are also people, from loving families, who are best helped by someone outside the family. This is where statutory, more objective, outside-the-family advice can be of help—or through a voluntary organisation. Then, as I am acutely aware, there are those from disturbed and totally unloving backgrounds.

As the House will know, we have reviewed the guidance to health authorities on the provision of contraception for under-16s. I mention this because the concept of parental responsibility, on which my hon. Friend rightly put so much importance, was very much in my mind when considering this matter. We have set out clearly the fact that we expect doctors and other professional counsellors who advise young people always to consult the parents unless there are strong and exceptional reasons why it would not be in the young persons' interests to do so. That surely must be the approach. The parent should know, unless that would clearly not be in the interests of the child. We believe that this framework will be observed equally by agencies outside the NHS which work with young people in this way—especially those which receive Government support.

Could the Minister enlighten the House a little more about the person who is making the decision whether the child's parents are better left out or better told? If it were to be a family doctor, who knows the family background and understands the circumstances in which the child lives, it would be perfectly acceptable that a decision should be made on that basis. But is not the Minister aware that many of the doctors in these clinics have never seen the child before, know nothing of the background, the parents or the home circumstances? How can such a person make such an assessment from just seeing the child?

I understand that point. We would expect this advice to be given by medical people or by professionally trained counsellors. We must have confidence that they will carry out their job in a proper professional manner. I will come back later to the subject of abuses.

We certainly believe that organisations which receive Government support will follow the Government's guidelines. The Family Planning Association was among those which warmly welcomed the statement about turning to the parents first unless there were strong reasons against. We also believe that agencies such as the FPA share our view that information about sexual matters which is given to children and young people should not be restricted to the mechanics of sex in isolation from the emotional aspects of loving, caring and lasting relationships.

The FPA makes particular reference to this in its objectives. Thanks to the kindly help of a number of people, I have been looking at some of the literature. The most offensive literature which has been referred to has, in fact, been withdrawn. I have looked at something which many people think is a good and adequate piece of literature. I came across, for example, the following:
"There is no reason at all to feel that you must have sex because you think everybody else is doing it all the time."
Further down, I read:
"Sleeping around when you are young, without real feeling for your partner, could make it more difficult for you to be a happy, contented person as you grow older. With something like 50 years ahead of you, it's worth thinking about whether you really want to have sex with someone just because he or she says you must."
It goes on:
"If you have any doubts, you should talk your feelings over with a sensible older person."
It then says that the most suitable people are one's parents.

Bearing in mind what a difficult subject this is to talk to people about, I should have thought that that kind of information was helpful and constructive and the sort of thing that we ought to support. For example, quite recently, when my right hon. Friend asked the Family Planning Association to cease stocking a book—not published by the association—it agreed at once. There was no argument about taking it off its bookshelves.

I assure the House that we do not dismiss the concerns expressed tonight by my hon. Friend the Member for Edgbaston and other hon. Members. I have asked the Department to keep a very close watch, while recognising the immense range of good work carried out, particularly by organisations such as the Family Planning Association, on what kind of advice is being given and the way in which it is given, and to let me know of any complaints which should be examined. It must be the Government's role to ensure that public money—my hon. Friend is quite correct about this—is spent in a responsible, ethical way which will increase family stability and raise moral standards and not have the opposite effect.

If hon. Members would like to bring to my notice any practices which they think are harmful, I shall certainly look into them. Where the welfare of the young is concerned, we are very much aware of our responsibilities. We are all grateful to my hon. Friend the Member for Edgbaston for raising this matter tonight.

School Meals

12.47 am

I am grateful for the fact that I have been fortunate enough to have been drawn in the raffle to speak on the important issue of school meals.

I declare my interest on two counts. First, I am a Member sponsored by the General and Municipal Workers Union, which has a massive membership at risk with cutbacks of the school meals service. Secondly, and rather personally, 50 years or so ago, as the youngest of three children of an unemployed father, I recall walking two miles from my school to another school to partake of a bowl of soup and a slice of bread, and then walking two miles back again. Hon. Members can imagine that, when one is 7 years old and has only one and a half hours in which to conduct the operation, there is not too much time to gobble down a bowl of soup and a slice of bread with a two-mile walk each side of that meal.

There is no way in which I am prepared to see the children of my constituents in Newcastle upon Tyne, West subjected to this miserable indignity—for that is what it was. Let this House clearly understand that that is exactly what can and may well happen again in the deindustrialised North if this despicable Government carry on with their awful inhuman policies. We can and we shall go back to the soup kitchens that I remember so well in the city of Newcastle upon Tyne.

The school meals service in England and Wales is rapidly being killed off by local authorities. The crisis in the service has been stimulated and provoked by legislation and the imposition of expenditure cuts on local authorities.

The Education Act 1980 removed the requirement that the local education authorities should provide a midday meal for every child who wanted one. The Government drastically reduced the number of children eligible for free school meals by confining eligibility to children from families receiving family income supplement or supplementary benefit. First the Government and then the local education authorities dramatically increased the cost of a school meal. Released from the Government-imposed obligation to provide school meals, local education authorities have made the school meals service the scapegoat for cuts in local authority expenditure.

Let us look at the history of the school meals service. Since the Education Act 1944, local education authorities have been under an obligation to provide a suitable midday meal for every pupil who wants one. Authorities were required to comply with certain nutritional standards. The Act's requirements were the culmination of a campaign dating back all of 50 years. As early as 1896 legislation enable Parliament to provide free meals from public funds for "necessitous children". I vividly remember that phrase. The eligibility requirements were tightened in 1934 to include the requirement that children must have detectable malnutrition to qualify for free or cheaper meals.

By then, fortunately, my late father was in full-time employment, and he did not lose a day's work until the day he retired 14 years later. That was after 12 years of unemployment. I say that lest anyone thinks that he was a lazy man; lazy men do not work for 14 years without losing a day's work.

By 1939, 250,000 children were getting free school meals. The Second World War and the consequent rationing provided a further reason for ensuring that all children received at least one nutritious meal each day. This desire formed the background to the eventual 1944 legislation.

Two recently published studies suggest that school meals are an effective way of reaching those children most in need. Both studies observed the height of a sample of children, and found that free school meals went most often to the shortest children. Height in children is a good indication of nutritional status. However, additional studies have also shown that school meals often fail to meet the nutritional guidelines laid down in regulations. These studies concluded that the nutritional quality of school meals needed to be beefed up.

We should look at the present Government's approach. The Government have abandoned all responsibility for the nutritional quality of school meals. That responsibility has now been devolved to the local education authorities, as part of the Government's calculated strategy to undermine the school meals service. The first part of the strategy revolved round this year's Education Act, which allows the authorities to decide what, if any, school meals to supply. It allows them to charge whatever they like for the service provided. The exception to both those rules is that the LEAs are compelled to provide a meal for
"any pupil whose parents are in receipt of supplementary benefit of family income supplement so as to ensure that such provision is made for him in the middle of the day as appears to the authority to be requisite."
Although the Act retained the duty to provide meals to poor families, the means test for eligibility for free meals was withdrawn. Over 500,000 children lost their entitlement to a free school meal at the same time—and this was at a time when it was estimated that 460,000 children entitled to free meals were not claiming them. Clearly this law had grave implications for the economics of the school meals service. So, too, did the rapid escalation in the cost of school meals at the end of the 1978–79 school year. The centrally determined price was 25p per day. By June 1980 no local education authority was charging less than 35p, and many were charging 50p.

Northumberland had already increased its charge to 55p a day. It is no coincidence that. Northumberland is the one Tory bastion in the North-East. Durham county and all the five metropolitan district councils maintain a 35p charge. Northumberland county will not last long as the final bastion of Toryism Next year should see an end to it. The first £1 a day school meal is quite likely to be served very shortly in Lincolnshire, where a cash cafeteria system will replace the existing school meals service from January of next year.

The increased charges for school meals will undoubtedly reduce the take-up. The Tories were well aware of the inevitable outcome when they embarked upon this policy. When school meals charges were increased by 10p a day in September 1977—and the Labour Party was in office then—the take-up fell to 648,000. To help cover up the cynical destruction of the school meals service, this Government have discontinued the spring and summer census of take-up in the school meals service. Only the autumn census remains.

In October 1978, 3 million primary school pupils, including 600,000 free meal pupils, received school meals. That represented 76 per cent. of those eligible. There were 2 million secondary school pupils, including 400,000 on free meals, who received school meals. That was 54 per cent. of those eligible. In special schools, 100,000 pupils, including 34,000 on free school meals, received a meal—equal to 95 per cent. of those eligible. The narrowing of eligibility for free school meals disfranchises over 500,000 school pupils.

Price increases will have further devastated take-up. Dorset county council, God forgive it, increased its charge to 45p a day. The result is that only a quarter of pupils in schools from the under-12s now take school meals, inluding free meals. Dorset estimated a drop of 20 per cent. in demand when charges increased again at the start of the summer term. Instead, take-up plummeted to 39 per cent.

I speak with a little feeling about the stigma of the situation. The massive decline in the numbers taking school meals will leave a residue of children taking free meals. Inevitably the difficulties already experienced in preventing identification of these children as poor must increase. Such identification can cause enormous psychological damage to children. I hope that no one will run away with the idea that, because of what I have said earlier, I am psychologically damaged. I might well have been, had I been a weaker character.

Such a development is likely further to reduce the take-up of free meals among those families who most need them. Even before increases in the school meals service, the combination of the fear of stigma and ignorance of their rights deterred an estimated 460,000 children from taking free school meals. I do not apologise for repeating that figure. In Dorset, where it has been decided to discontinue the school meals service for children under 12, some form of food will be provided only for those children whose parents receive supplementary benefit or family income supplement. It will, therefore, be absolutely impossible to conceal their identity.

Local education authorities are now free not only to charge what they wish for the meals they produce but also to provide whatever amount of food of any nutritional value they please. Inevitably the LEAs have cut back on both the quantity and the nutritional content of the food they provide. "Snacketeria" and other services now abound, and the use of school meals to combat social deprivation is virtually at an end at the very time when Britain's unemployment level is inflicting hardship on increasing numbers of working people.

Three hundred thousand jobs are at stake and many of the new unemployed may well be from the school meals service. Before the onslaught of this Government, 300,000 people were employed in the service. Now every LEA is cutting back on school meals. Initially cuts were made through natural wastage, early retirement and voluntary redundancy. Cuts in hours for part-time staff were also common.

Now Dorset county council has announced the end of school meals for the under-12s despite protests from my union which organises the staff there and despite the protests of parents and school staffs. Over 700 redundancies have already been announced, and the Dorset school meals service has lost over 1,000 of its 1,500 staff since January. Moreover, the redundancies have been announced in a heartless and cavalier fashion without the proper consultation provided for under the Employment Protection Act. So anxious was Dorset county council that there should be no new term for its dinner ladies that the statutory 90-day period of consultation has been completely ignored.

Local education authorities all over the country look set to follow in Dorset's footsteps. Gloucestershire has announced up to 900 redundancies. North Yorkshire has announced that it will make 400 staff jobless. Dudley county council and Devon county council have also inflicted redundancies. But even where there have been no redundancies jobs are still being lost. Northamptonshire has cut out 301 jobs and Devon has cut the equivalent of 200 full-time jobs.

At the outset the TUC estimated that the Tory measures would take out up to 40,000 jobs and it is now clear that Tory legislation has totally undermined the school meals service. The service is being made the scapegoat for local authority expenditure cuts. All 300,000 jobs are now at stake.

I conclude by asking the House a question. Is there anything great about a Great Britain which publicly identifies each and every child in the country who suffers the deprivation caused by unemployment? That identification will be made to all and sundry but most of all to their school mates. No group is more cruel than school kids.

Surely no hon. Member can be so naive as to believe that as and when the LEAs cut out provision of staff and kitchen facilities they will make provision for supplementary benefit and FIS kids in every school. Of course hon. Members are not so naive, no matter what columnists such as Crossbencher or John Junor may say about us. None of us is as thick as to believe that.

We all know that kids on FIS and supplementary benefit will be fed communally at what the many unfortunate youngsters of my generation knew as soup kitchens.

1.4 am

My hon. Friend the Member for Newcastle upon Tyne, West (Mr. Brown) is to be congratulated on two grounds: first, on coming first in the ballot for a debate on school meals; and, secondly, on the way in which he has covered nearly all the ground. His speech makes further comment almost superfluous. I am sure that that will appeal to hon. Members from London constituencies, who are waiting to speak in the debate on London. Nevertheless, despite the way in which my hon. Friend covered the ground, I should like to put a few further points on the record, even though hon. Members will recognise them as being not too different from points already made.

We have discussed this issue many times in the past 12 months on the Floor of the House and, at length, in Committee. The central charge that we who opposed the Education (No. 2) Bill make is that it is the Government's deliberate intention, under the guise of increasing local authority freedom, to dismantle the school meals service. That is the charge to which the Minister addressed himself on 13 February when we considered the Report stage of the Bill. It remains our charge, and evidence indicates increasingly that that is the consequence of the changes made in the schools meals service by the Act, as it now is.

One can see two factors. Higher charges for school meals are leading directly to a reduction in the level of school meals provision. Second, as a consequence of that reduction, inevitably redundancies on the scale that my hon. Friend the Member for Newcastle upon Tyne, West indicated have occurred, are occurring and will continue to occur, probably at an accelerating rate.

Let us consider the changes that the local education authorities have made. Fifty-eight of 102 local education authorities have increased their prices, and all report a drop in the take-up. The reduction is particularly marked in those authorities that have imposed the largest price rises. They are Bedfordshire, Cheshire, Hampshire, Humberside, Northamptonshire—where there has been a reduction in demand of at least 50 per cent.—Northumberland, mentioned by my hon. Friend, and Solihull. They have increased their prices to between 50p and 55p per day. Not surprisingly, they cannot understand the reason for the fall. To Labour Members the reason is clear; parents cannot afford to pay those prices.

Local education authority chiefs are surprised to find that the price rises have not relieved the pressure on their budgets. It is hardly surprising that that has not happened. Perhaps I may quote here a comment in the House by my hon. Friend the Member for Bedwellty (Mr. Kinnock) to the hon. Member for Gravesend (Mr. Brinton), who, perhaps not surprisingly, is not present. I apologise for the technical jargon. My hon. Friend said:
"If, there is a diminution in the marginal propensity to consume as a consequence of the rise in school meal prices how much of a loss is the county of Kent prepared to sustain on each school meal by under-charging for nutritious or even non-nutritious meals? Will the consequences not be that, even with higher charges on that scale, under the freedoms given in the Bill the cost of the schools meals service per unit to the providing county will be greater and thus defeat the hon. Gentleman's objective?"—[Official Report, 13 February 1980; Vol. 978, c. 1566.]
Even taking account of the jargon, that explains succinctly what is happening in a great many local education authorities. They are increasing the price and as a result the demand is falling. That is proved beyond a shadow of doubt by what is happening in Dorset. Following price increases, demand has dropped by 50 per cent. As a consequence, the local education authority has wisely decided to phase out school meals for primary pupils, with the exception of its statutory obligation to provide meals for those children covered by the very mean free school meal provisions of this Government. We should note that it is a cold meal.

Devon is the first county to see the logic behind the Tory Government's policy. I believe that Dorset is the first in a long line of local education authorities that will reduce, if not stop, its school meal service. Dorset demonstrates that, as the price of school meals increases, demand decreases, and that ultimately the only option is to stop the service. In those authorities where prices have not been increased, which are mainly Labour-controlled, working-class areas, such as Barnsley, Bradford, Gateshead, North and South Tyneside, Sheffield, Sunderland and Manchester, there has been no fall in demand for traditional school meals. Rapidly rising charges lead to a dramatic drop in demand and place the service in jeopardy. Those areas that have not increased prices should not be forced to maintain the service at the expense of other parts of the education service.

The Minister claims to be compassionate. Even at this stage I appeal to him and his right hon. Friend to reverse their policy on school meals and maintain the grant for 1980–81 at the level of 1979–80. Their policy is placing an intolerable strain on many family budgets. Parents are faced with the invidious choice of deciding whether they can afford to pay for a school meal. Many are finding that they can no longer afford it. We shall not know for many years the consequences of the reduction in take-up of school meals for children's health and general well-being.

I urge the Minister and the Secretary of State to insist to the Prime Minister on a reversal of the policy. Failing that, the right hon. Gentleman should do the honourable thing and resign.

1.13 am

I, too, congratulate my hon. Friend the Member for Newcastle upon Tyne, West (Mr. Brown) on his good fortune am: good judgment in initiating this debate, even at this time. I am only sorry that our colleagues with other debates will have a long wait.

This is not the first time that I have sought to draw the problems of the new legislation to the attention of the House. I raised an Adjournment debate on 23 May, when I dealt with the serious problems that I believed were developing in school meal services. That was two months ago, when there was still speculation about the issue. We know what is happening. More local authorities have made their decisions. There has been a spectacular drop in demand for school meals all over the United Kingdom.

The Under-Secretary of State for Scotland, the hon. Member for Edinburgh, Pentlands (Mr. Rifkind), in reply to my Adjournment debate, spoke about the benefits of the new system and the increased freedom that the Government were giving to local authorities. In his closing sentence, he said:
"the school meals service has improved rather than deteriorated because of the variety that is now available".—[Official Report, 23 May 1980; Vol. 985, c. 1016.]
"Variety" is indeed the word. Apart from the children of families in receipt of family income supplement or supplementary benefit who must have something to eat—goodness knows what—a fine old variety of alternative versions of Tory deprivation has been made available to our children.

My hon. Friend the Member for Bedwellty (Mr. Kinnock) summed up the effect of the Education Act 1980 with uncharacteristic brevity when, on Second Reading of the Bill, he said that local authorities would have the power, the glory, but not the money. That is what it is all about. In Scotland, £18·2 million is missing from the school catering budgets of Scottish local authorities because the Chancellor of the Exchequer, not the councils, has taken advantage of the so-called discretion which is written into this nasty piece of legislation. Meanwhile, it is interesting to note that he has been able to make £.3·4 million available to privileged families who want to take advantage of the assisted places scheme. But that is another story.

Coming back to the variety of meals that the Under-Secretary said was being provided in schools as a result of the new legislation, essentially four different options are available to local authorities. We have heard about Dorset. That fine county, which gave us the Tolpuddle martyrs in 1834, is likely to give us the hungry children of 1981, because it has scrapped the school catering service altogether, except for those children of families on supplementary benefit or family income supplement—and heaven knows what they are getting. It is a pity that hon. Members representing Dorset constituencies are not present to tell us what is going on in that county. Perhaps they are ashamed of what the Tory Party is doing in that respect.

The second option is that of high rates, whereby the council covers the shortfall in the budget which has been caused by the cut in Government subsidy by increasing the rates. That is happening in the Lothian regional council, which covers the largest part of my constituency in East Lothian. The council found it necessary to increase the rates by 41 per cent., for this reason and other reasons, to maintain a reasonable standard of school meals and other services at the original price. It seems clear that the Lothian electorate is satisfied with what is going on there, because, if the results of the district elections in May are anything to go by, people are swinging to the Labour Party in no ordinary fashion.

The third option is to charge higher prices for the meals. That is happening just over the boundary from my constituency in Northumberland where, as my hon. Friend the Member for Newcastle upon Tyne, West said, 55p is being charged for a meal. That obviously causes hardship for many families, particularly those who are caught in the new poverty trap which has been created, including single-parent families and other poor families who qualified for free school meals in the past but now no longer qualify because the number of free school meals provided in the United Kingdom has been halved as a result of this nasty piece of legislation. That, combined with the higher charges, in areas where they are taking effect, is obviously leading to a lower uptake of school meals, which inevitably means that the school meals service becomes that much less efficient and is subjected to much more in the way of further constraints.

The final option available to local authorities is any of a number of combinations of all those forms of cuts—higher chargese, dearer meals or a lower standard of meals. All of those inevitably lead to a lower uptake of school meals.

The Under-Secretary of State for Scotland waxed eloquent on 23 May about the benefits of the cafeteria system in schools. I agreed with him. It stands to reason that in secondary schools children would benefit from having a choice of what to eat. However, on that occasion the Minister conveniently overlooked the consequences of that sort of system in primary schools. I invite the House, and the Minister in particular, to speculate on the joys of 6 year-olds taking advantage of free choice in primary school cafeterias. It stands to reason that it would be chaotic and wasteful, and the Minister knows it. It is time that he faced up to that fact.

It seems to me that the cafeteria system is an interesting new development in secondary schools. I think that the House would welcome the fact that it provides more variety for secondary schoolchildren. But I am sure that we are all worried about the additional cost that it imposes on a lot of families. In addition, we must face up to the mounting crisis in primary schools, where children are most vulnerable to the problems of poor nutrition if they do not get proper meals.

I should like to refer at this stage to the former county of Berwickshire, which lies within my constituency. It is now within the territory of the Borders regional council. There the local authority is making the mistake of attempting to implement the Government's culinary logic, if I can call it that. There are three secondary schools in that part of my constituency where the cafeteria system seems to be functioning fairly well. Two of those school kitchens also provide a service for neighbouring primary schools. Presumably, therefore, those two are safe enough.

Besides that, I have within Berwickshire 23 primary schools which are on their own so far as the catering service is concerned. The number of children in those schools ranges right down to one school at which there are only 11 pupils. All those schools are in isolated rural communities. It stands to reason that the cafeteria system cannot work in that sort of situation. Therefore, Berwickshire is down to the one-course meal for primary children in those schools, at a cost of 35p per meal. I am sure that my hon. Friends would agree that in many cases that represents an inadequate meal at an excessive price. Once again, we must face up to the fact that the uptake of the meals has slumped seriously, particularly in the summer months.

I am concerned about the possibility that the schools meals service will not survive in any appreciable scale for the winter months, when the need will be greatest. That is because, in order to balance the books, the council has had to make several of its staff redundant. Apart from those who have been made redundant, literally all members of the school meals staff within that part of my constituency are being put on short time. It is interesting to note that the reason given on the official redundancy form is:
"Changes as a result of amendments to Education Act in respect of the statutory requirements to supply school meals."
In other words, the Government are directly responsible for these redundancies.

Previously in that part of my constituency, 42 staff worked a total of 817 hours a week, at a cost to the council of £1,416 a week, to serve 1,200 meals a day for 1,500 pupils. Come September, when the new session starts, the remaining staff will have to work 560 hours a week, at a cost of £866 a week, to serve just over 1,000 meals to the same number of children; in other words, the saving will be only £550 a week. I wonder whether it is worth it. There will be a reduction of about 900 meals a week served to the children. We can only speculate on the harm that it will do to the children in that part of my constituency.

In addition to the question of hungry children, we have to ask whether the staff will consider it worth while to carry on working under this new regime. At present, the average gross earnings of people in that part of the service are £33·71 for a 191 hour week. After the cuts, their earnings will average £20·62 for 13 hours a week worked.

That average conceals some rather extreme circumstances. For instance, in my own local primary school in the village of Hutton—I hope that my son will go there eventually if the Tories have not closed it by then—the lady who looks after the school meals is at present working 10 hours a week to earn £13·61. That is two hours a day. She has been notified that her hours are to be cut to five hours a week—one hour a day—for £7·15 gross cost to the local authority. Is it really worth anyone's while to come out of the house to do a fairly tedious and unpleasant job for an hour a day to earn only that amount of money—£1·43 a day? We are clearly asking too much of some of these ladies.

We are therefore subjecting the whole system to impossible strain, particularly in primary schools and particularly in rural primary schools, where the need is greatest. When I drive through that part of my constituency at 8 am and see schoolchildren standing at farm road ends, in all weathers, waiting for transport to school, I often wonder how many of them have had a decent meal before they left the house. I am forced to reflect on the fact that many of them, in the next school session, may not get anything more than a sandwich or a packet of crisps until their parents get back from work after 5 pm. The service will have been strangled by then because of the cuts and because the people who run the service at present will not find it worth while working in it any longer.

I wonder whether my hon. Friend's constituency is similar to others, notably Brent, the constituency of the Under-Secretary of State for Education, where 4 per cent. of the infant schoolchildren, 9 per cent. of the junior schoolchildren, and 21 per cent. of the secondary schoolchildren will be going to school without any form of breakfast. They will be part of the 1½ million children in Britain under the age of 19 who leave home in the morning without breakfast.

These are extremely alarming statistics, and they are all the more alarming where we are talking about the young primary schoolchildren who really are not in a position to fend for themselves. This illustrates the sort of position that the Government are creating. It causes great concern to all of us on the Labour Benches.

The primary school catering service is in extreme peril as a result of Government constraints which are a monstrous travesty of the word "freedom". The Government are guilty of a number of crimes, but this crime against defenceless children must be one of the worst of all.

1.30 am

I congratulate my hon. Friends the Members for Newcastle upon Tyne, West (Mr. Brown), Leicester, South (Mr. Marshall). and Berwick and East Lothian (Mr. Home Robertson) on their contributions. They have all been brief, and I intend to follow their example. However, they have been extremely forceful.

My hon. Friends have been assisted by having the practical illustration of the recent action of Dorset to which to refer. I intend to make reference to that example in the hope that the Under-Secretary of State will tell us more about the position in Dorset. It is the wish of the Opposition to expose what is happening in that county so that warnings are made available for those who might become similarly afflicted as other councils are forced to follow Dorset by dint of economic circumstances and Government cuts. Dorset has provided a disastrous example.

In a sense this is the "we told you so" debate, as I am sure the Minister will readily acknowledge. I am informed that his right hon. and learned Friend the Secretary of State has already acknowledged that when the Opposition and others outside the House repeatedly warned the Government of the consequences of implementing sections 22 and 24 of the Education Act 1980 we were accurate in our warnings and that some of our worst fears have been fulfilled.

It was for reasons only of illustration and speculation that we gave instances in Committee of the consequences of a local education authority contemplating and implementing the closing down of a school meals service for some of its pupils. Even in our darkest moments during the debates in December, January and February we never envisaged that it was possible before the end of 1980 for such a thing to occur in a part of the United Kingdom.

The Government's inspiration is the social market economy as preached by the Secretary of State for Industry. It is strange that they should have such a profound misunderstanding of the market consequences of their own policy of the withdrawal of subsidies for local authorities to provide school meals at prices that parents are prepared and able to afford. They do not seem to understand their own law or economics. If the price is increased dramatically and no change is made in the quality of the goods provided in exchange for that price, or if as a consequence of increasing the price and removing other subsidies there is a possibility of a fall in the standard of provision, the result will be a significant reduction in demand for the goods that are being sold at a higher price.

We have seen reductions in demand. The reduction of 25 per cent. was quite conventional. A reduction of 30 per cent. was slightly less usual. We have seen a decline in demand of 50 per cent. among not only secondary schoolchildren, who conventionally have a lower record of uptake of school meals for a mixture of reasons than other children, but primary schoolchildren. When we argued on Second Reading, in Committee and at all other stages that the market would follow the economic law as it has been described by the Tory Party's Front Bench, and in even more dramatic terms by Tory Back Benchers, our views were dismissed as exaggerated—a favourite word of the Under-Secretaries of State—hysterical, and as a wildly inaccurate prospect being used merely to frighten the British people.

We take no joy in making the comment that we were right. Indeed, we were erring on the side of modesty in anticipation of the consequences of the Government's Act and the accompanying cuts. It is difficult to form an overall picture. We have to rely on press reports. Some of the reports, such as those that have appeared in the education weeklies such as The Times Educational Supplement and one or two other newspapers, have been pretty thorough. However, they do not have the comprehensive resources of the Department of Education and Science.

In recent months, every inquiry that has been made into price increases and their impact on the cost of school meals has met with the blunt response that such figures are not collected.

In Committee, we emphasised that the Government were making a major alteration to a basic social provision which had been in existence since 1944. We pointed out that systematic monitoring should be continued by the Department. We so argued on two grounds. We did not argue merely for the sake of argument. We wished to discover whether the Government's reaction to the local education authorities' response to cuts would be as benign as the Government anticipated. We also thought that systematic monitoring was necessary if we were to find out the effect of cuts on the standard of service provided.

In Committee, I quoted the letter that was written on 3 November 1979 and which appeared in The Daily Telegraph. It was written by doctors, hygiene experts and other experts from Brunel university, the London School of Hygiene and the Medical Research Council. They said:
"Further, there is real danger that school snacks will be based on economic tenets"—
or, as the Prime Minister would say, "teenets"—
"instead of nutritional ones".
That danger quickly became a reality. Since 3 April, the date on which the Education Act came into force, nothing has been based on nutritional or social considerations. It is true that children are in the care of local authorities, but they are ultimately in the care of the Secretary of State. Everything has been based—as the authors of the letter forecast—on "economic tenets." It represents, not only in Dorset, but in every similarly afflicted local education authority, the desertion of an elementary social obligation. Until now, every modern Government has sustained that obligation.

We did not expect the Government to understand the consequences of the Act. As a result of previous debates, we realised that the Government had miscalculated the consequences of their policy. We took advantage of the evidence made available by Mrs. Angela Rumbold. She was then a leading light on Tory education authorities. She still is a leading light, but the lamp shines slightly more inside her bushel now. As long ago as 21 September 1979 she spoke of the £200 million reduction and said that it was impracticable to reduce the service by that extent in the immediate future, for which they were budgeting. She also said that if authorities had to make savings of that magnitude, they would have no choice but to dig deeper into other areas of education spending which were already facing reductions. That could only mean reductions in the levels of basic education provision."

The Secretary of State protested then and has continued to protest that the Government's education cuts had no implications for the classroom. He implied that falling school rolls woulds cover the cuts. Cuts have fallen on meals, milk, and transport, despite some slight interference in the smooth progress of the transport provisions. They have also fallen on administration. In August 1980, we have discovered that the Secretary of State was hideously out as regards anticipated savings. Instead of saving £200 million by withdrawing school meals subsidies he has saved only £80 million. Consequently there has been a £120 million cut in other areas of education. Some of it has come from rises in school meals prices. However, the reduction in take-up of school meals and the consequent rise in the unit cost of provision has wiped out any advantage in economic terms of following that course.

We are beginning to see where the pressing need for teacher redundancies and the effect of reduction in capitation allowances come from. The Secretary of State and the Government have failed to fulfil their purpose of making reductions out of the withdrawal of subsidies on school meals. That results in cuts in the classroom, which the Secretary of State solemnly promised would not occur under the cuts programme. The situation is extraordinary. Instead of saving £200 million, we are saving £80 million. In the process the school meals service in many parts of the country has been wrecked or is in the process of demolition. At the same time, there is a reduction in classroom provision, in spite of the Government saying that such provision is their main spending priority in education.

Between September 1979, when Mrs. Rumbold was issuing her warnings, and November 1979 when I and my comrades were issuing our warnings, there was only a short time before the speech in July when the Secretary of State plaintively told the Association of County Councils that school meals on which estimates of expenditure were over 60 per cent. above the Government's assumption presented special difficulties this year—difficulties not to the Government nor to the local education authorities but to the children suffering the consequences of that hideous miscalculation, that hideous innumeracy and stupid illiteracy which the Government have shown.

The example of Dorset is before us. It moved the famous resolution at the conference of local education authorities saying that the Government should take their hands off the education windpipe of the local education authorities, which are in the frontline. They have not been known to be generous in the past. When further cuts are enforced on them, they will have to make savage and deep cuts.

Tories for several decades have made strong criticisms of the Government. The Minister should take heed of that, not only in terms of his Government's self-preservation. Conservatives who complain are speaking with the authentic accents of those whom they represent. They find that the dimension and depth of cuts on which the Government insist are utterly incompatible with the maintenance of a proper education service, let alone with the development of an improved service in the maintained sector.

We warned that the Dorsets of the educational world would occur. The Government were so frightened that they packed off a couple of civil servants to try to pull the Dorset education authority into line. That did not work. We are left with the Government's illiteracy and innumeracy being compounded by their blindness to what is taking place.

In response to my hon. Friend the Member for Cannock (Mr. Roberts), the Under-Secretary of State said:
"Local education authorities must make every effort to ensure that pupils and parents are aware of entitlement to free school meals. We dealt with that in the Education Act 1980. We also enabled local education authorities to be free to adopt a higher level of entitlement to free school meals as part of that assessment."
The procedure for doing that escapes me because the Act reduces the entitlement to free school meals for 400,000 children.

The Under-Secretary continued:
"I believe that the anonymity of youngsters receiving free school meals is well understood by head teachers, and I endorse what the hon. Gentleman said. It is of paramount importance that that aspect is observed."—[Official Report, 10 June 1980; Vol 985, c. 290.]
I wonder how that paramount importance is to be sustained in Dorset, where the clearest possible definition will be afforded to children who are in receipt of free school meals because their families are on family income supplement or supplementary benefits. They will be the only children receiving free meals.

An education spokesman in Dorset told The Times Educational Supplement on Friday:
"I am sure schools will find ways of handing out free lunches with the home made variety."
The report stated that, on the whole, sandwich lunches were not normally kept in satchels in cloakrooms but were handed in to supervisors first thing in the morning to be distributed at dinner time. The official said:
"Protecting anonymity has always been difficult, even in the best of circumstances; and of course there will be practical difficulties under the new system."
He was not exaggerating. In order for those children not to be identified, we shall have to see in Dorset totally indistinguishable packing, a mass-provided service that lacks all the attributes of mass production and provision. The Under-Secretary knows that the hope that he expressed in June was an idle speculation. He is doing nothing to ensure that that hope is implemented.

Dorset's awful promise was investigated by a number of people who were trying to establish whether the local education authority was in default of its responsibilities. The Secretary of State advised those who inquired that the LEA was not acting unreasonably, because the provision of a meals service where demand had significantly dropped was unreasonably expensive and therefore the LEA had discharged its duty. The moral of that tale is that if any LEA should increase its school meal charges to a preposterous level—so high as to dissuade anybody from buying the meals—it cannot be said to be acting unreasonably, because, since the consequence of the rise in price will be a dramatic fall in the uptake and an increase in the price of providing the meal, the LEA will be exempted from challenge under section 99 of the 1944 Act or under any other legislation. What a ridiculous situation the Government have got themselves into.

I cannot believe that when the Secretary of State and the Under-Secretary set their hands to sections 22 and 24 they expected to get into such an idiotic situation. They repeatedly lectured us about having faith in local education authorities and told us that the word "requisite" would be generously interpreted. We were told that LEAs would go to pains to safeguard the position of children with special meal needs. We know now that that whole idea has been demolished.

We shall have to rebuild from the ruins, and to re-establish nutritional standards and meals at a price that parents can afford and in circumstances in which children want to eat them. We shall have to build a school meals service throughout the country that meets modern needs at modern prices. The job of doing that and of meeting the needs of children and meeting our duty as representatives and as a future Government has not been eased by the Government. But the greatest damage is not to the Government's credibility but to the interests of children and parents throughout Britain.

1.49 am

I shall endeavour to answer many of the points that have been raised in this important debate. If I do not echo the congratulations of his hon. Friends, I am sure that the hon. Member for Newcastle upon Tyne, West (Mr. Brown) will understand that many of us have been round this course before. Nevertheless, I do not object to the sincerity that the hon. Gentleman introduced into his arguments. There were many historical aspects to which no one in the House would wish to return. I hope that I shall be allowed to proceed with my speech in some degree of peace and quiet. At the risk of upsetting the hon. Member for Bedwellty (Mr. Kinnock), I shall try to answer some of the points that have been made.

I should like to deal first with the remarks of the hon. Member for Berwick and East Lothian (Mr. Home Robertson). He will forgive me if I do not reply in detail to the many points that he raised about his parochial problems in Scotland. I have no doubt that the points were aired fully by him in his Adjournment debate. He may not feel satisfied with the reply, but that is no doubt always the divide between Opposition and Government. If any points arise from his speech, I shall draw them to the attention of my hon. Friend at the Scottish Office. I echo the hon. Gentleman's view about the provision of cafeteria meals in primary schools. It would strike me as crazy for any school to envisage a cafeteria system for primary school children. We would do our best to dissuade any thoughts along those lines.

The hon. Member for Bedwellty and I sat opposite each other in Committee for many months and also for several hours on the Report stage of the Education (No. 2) Bill debating this clause. The hon. Gentleman is right in saying that it is difficult to form an overall picture of the effects of the legislation. We must reserve our judgment. At this stage, there is a lot of speculation. Certain decisions have been taken which may not be to everyone's satisfaction, but it is far too early for any objective assessment to be made.

The Government have made clear from the time they took office the im- portance they attach to reducing public expenditure and their determination to secure this aim. The education service could not be excused from this strategy. It will be recognised that the previous Administration acknowledged that the school meals service had become excessively expensive. The previous Administration raised the cost of school meals fairly progressively throughout the mid-1970s. Nevertheless, we wanted to ensure that, so far as possible, the quality of education provided by the schools should be safeguarded. We therefore accepted the view put forward by many local authorities that there would be considerable scope for reducing net expenditure on the school meals service if the statutory requirements could be relaxed. This would be possible by a combination of reduced production costs and more realistic charging policies.

In 1978–79, the gross cost of the service was in excess of £700 million at November 1979 prices. I am glad that the humour of the hon. Member for Wood Green (Mr. Race), even at 1.52 am, has not deserted him. That, at 1979 prices, would be equal to a net expenditure of about £460 million after taking account of income from paying pupils. To put this into perspective—it is a matter to which the hon. Member for Newcastle-upon-Tyne, West referred—spending on books, materials and educational equipment in the same year was just under £200 million. The sum of £460 million was the equivalent to the cost of employing 70,000 teachers in the same year. The charge for the school meal was then less than half of what it cost the authority to produce.

Those points were acknowledged fully by the Labour Administration. Now that the statutory requirements have been relaxed under the provisions of the Education Act 1980, it is undoubtedly true that authorities are facing the biggest policy change on the school meals service since 1945. While the legislation is taking place within the local authorities, many decisions have been taken and others will no doubt take shape. Everyone acknowledges that, when new legislation is placed on the statute book, it takes time for local authorities to decide their priorities and policies.

The hon. Member for Newcastle upon Tyne, West will acknowledge that the situation in 1945, was very different from that in 1980. Society and its background, and nutritional standards, were totally different. One result of freeing local authorities is that there will be considerable variation in what individual authorities do and what priority they decide to give to expenditure on school meals. There is no doubt that many authorities have made their decisions already; others will decide over the next months precisely what they want to do.

I come to the question of Dorset, which was mentioned several times, because one or two exaggerations were made. Perhaps hon. Members opposite do not understand fully what has happened here. [Laughter.] It may take me some time to make my points clear, so I would not want London Members to be under any illusion that we could start at any earlier stage on the debate in which they are interested.

The 1980 Act does not require a local education authority to provide a paid school meals service. The decision by Dorset to discontinue the service for primary pupils willing to pay is not one that I would commend to other authorities. Everybody acknowledges that. Although I acknowledge and commend Dorset's determination to reduce expenditure, I believe that all authorities, Dorset included, recognise the value of the school meals service and the importance to it of maintaining high income from paying pupils. But the task facing Dorset in reducing expenditure on the service was perhaps greater than that for other non-metropolitan authorities. That relates to the point raised by the hon. Member for Newcastle upon Tyne, West.

A number of Labour Members mentioned the free school meals service. About 30 authorities have so far decided to restrict free entitlement to pupils whose parents receive supplementary benefit or family income supplement. During the summer term about 50 authorities—more than half of all authorities in England—had made no change from the arrangements which were in operation at the end of 1979. Where authorities do restrict entitlement to free meals to those children whose parents receive supplementary benefit of FIS, financial hardship can undoubtedly result from the loss of free meals, particularly in large families. But it is open to every authority to ease this by using the powers in the 1980 Act and by adopting suitable policies. I stand by the point that I made to the hon. Members for Bedwellty because that point—

has been made clear throughout the debate that we had, both in Committee and on Report.

As for the word "stigma", which the hon. Gentleman used, it has never been possible to ensure that children receiving free school meals could not be identified. I certainly hope that headmasters and local authorities will always do their best to adopt arrangements to avoid such identification.

The most important point raised in the debate concerned nutrition. The school meals organisers care about the nutritional value of the meals that they provide for children. They still have available to them the information contained in the Department's report "Nutrition in schools", published in 1975.

It has not been withdrawn. Local authorities still have that document today, and it remains relevant today, when account is taken of the updated advice from the DHSS committee on medical aspects of food policy, contained in its recent report "Recommended Daily Amounts of Food Energy and Other Nutrients".

Most authorities are continuing to provide a more or less traditional two-course meal for primary pupils. The nutritional standard of these meals will not necessarily have changed, except in regard to items not popular with the children. That is an important aspect which hon. Gentlemen must understand. While they may prefer to retain what has happened over the past 30 or 40 years in the school meals service, they must understand that great changes have occurred and that children themselves are not always taking up the food that we may have had in previous generations.

It is all very well the hon. Gentleman suggesting that I should come on, but many points were raised to which I should respond—although no doubt we can continue this matter at Question Time later today. Many hon. Members—[Interruption.]

Order. There are too many sedentary interruptions.

Thank you, Mr. Deputy Speaker.

The hon. Member for Workington (Mr. Campbell-Savours) indicated that it was disgraceful that children were allowed to leave their homes in the mornings without having had a meal. Whether or not he lays blame at the door of the parents or on the school is open to conjecture; he did not say. No doubt he will give the House the benefit of his opinion from a sedentary position.

I am aware of reports that many children are being sent to school without having been given an adequate breakfast, but I do not see why local authorities should be expected to make up for this. I do not see that this is their responsibility. Certainly, to the extent that some parents may have come to rely on the school to feed their children properly on the 200 or so days in the year that schools are open, they will in future have to shoulder once more what most people would regard as proper parental responsibility. That is important.

However, having said that, my Department is aware and I am encouraged to learn that an increasing number of authorities are now providing mid-morning refreshments ranging from hot and cold drinks to light snacks. This helps to meet a need and may well generate some useful income. There remains the important statutory safeguard for children from the poorest families.

I wonder what the hon. Gentleman would have to say about an authority such as my local education authority, which, far from providing any sort of refreshment during the day, in terms of hot and cold drinks, has refused to allow primary or junior school children to bring their own hot or cold drinks, such as milk, into the school. Does the hon. Gentleman have a view about that?

I should have thought that the local authority was best able to judge what policies it should determine. I have no doubt that the hon. Lady will make her views known to the chief education officer and the head teachers in her constituency. No doubt the pressure from parents, if they feel strongly about the matter, will also be part and parcel of the democratic processes in the hon. Lady's area.

I want to conclude on the question of charges, which the hon. Member for Newcastle upon Tyne, West mentioned. Again, there were some exaggerated comments from Opposition Members. During the summer term just ended, the average charge for the school meal was less than about 40p. Out of 96 authorities in England, 41 retained the charge at 35p, the level set by the Government last February, and 26 adopted a charge of 40p. Thirteen authorities set the charge at 45p, 14 adopted 50p, and two introduced a charge of 55p. Most authorities are planning to increase their charges next term, but the average will still be less than 45p, so far as we can tell from preliminary informal inquiries. That represents a figure well below what it costs to produce the meal. Certainly that is an important aspect, because in 1978–79, the latest year for which detailed figures are available, the national average cost of the meal was about 54p of which nearly 17p was the cost of the food and 25p was the cost of staff preparing it. The retail value of the food provided is greater than local authorities pay, because they are able through bulk buying and competitive tendering to buy cheaply.

Will the Minister now try to answer the central point put to him by my hon. Friend the Member for Bedwellty (Mr. Kinnock)? The Minister has emphasised that a number of local authorities still maintain the 35p charge, and that a number have increased it by only 5p. If that trend continues, it will mean that the Secretary of State will not reach his target of saving about £200 million in this financial year. Therefore, rather than taking satisfaction from the low average level of prices, will the Minister tell us how that saving of £200 million will be made if prices are not increased?

I do not intend to speculate on the precise nature or effect of these particular actions over the next few months. The savings must be made. I think that all hon. Members understand fully the economic condition of the country. The savings will be made.

I understood the Minister to say that the meal costs 54p. Is the hon. Gentleman aware that his fellow Under-Secretary of State, answering a question by my hon. Friend the Member for Rother Valley (Mr. Hardy), gave a list of the charges that authorities were making, and said:

"No authority is known to be charging the full cost of providing a school meal"?—[Official Report, 13 June 1980; Vol. 986, c. 314].
If, as the hon. Gentleman has just said, the cost is 54p, Northampton and Northumberland, which are charging 55p, must be charging at least 1p more than the cost of the meal. That indicates that the Department does not get its facts right. I suspect that it has given the hon. Gentleman some bad information tonight.

The figure that I quoted was for 1978–79, the latest year for which detailed figures are available. I said that the national average cost of the meal was about 54p, of which nearly 17p was the cost of the food. Before that, I said that two local authorities were introducing a charge of 55p next term. I hope that that satisfies the hon. Gentleman.

Many points have been raised. I shall read the Official Report of the debate and answer some points in writing if the hon. Members concerned feel that they have not been fully dealt with.

The hon. Member for Bedwellty spoke of the "ruins" of the school meals service. That is an exaggeration. The service is still in existence. We attach a great deal of importance to it, as local authorities clearly do. We acknowledge that it is an important feature of daily school life. I cling to the view that I took in Committee and on Report of the Education (No. 2) Bill, that we have confidence in local authorities to continue with the provision of the service. Whatever adaptation there will be over the next few months, we still have that confidence.

London (Government Assistance)

2.6 am

As the night is still very young, I call the attention of the House to the impending housing crisis in London, which has been caused by the destructive policies carried out by the Tory Greater London Council. It has been worsened by the collapse of new house building all over the country, and in particular by the utterly reckless actions of the Tory council in Wandsworth, which includes my constituency. All these practical proofs that the Tory Party no longer cares in the least about housing, if indeed it ever did, and about the thousands of wretchedly housed families in London, are combining to cut down further and further the number of council dwellings available for those most in need.

The GLC's completely irresponsible policy of handing over housing estates to the boroughs means that the only slender hope that was once available for council tenants to move from one part of London to another has almost disappeared. The Prime Minister is advising the population of Wales to move to London. My constituents cannot move from Battersea to Southwark, because it is impossible to find anywhere to move to. Indeed, the Tories on the council in Wandsworth have now devised an even more extraordinary scheme, by which most council tenants in that borough cannot even move from one ward of Wandsworth to another.

On top of this, and probably worst of all, the sale of council houses is drastically reducing the number available to let. Hardly one constituent who comes to my surgery, or writes me letters about his or her housing needs, can buy a house. For the first time in many years, I am having to tell any number of people in distressing housing conditions—for instance, old ladies of 80, living alone and in frail health—that there is no practical hope now of their being rehoused in London, as long as present Tory policies are continued.

The Tories did tell us that the sale of council houses was intended to enable the sitting council tenant to realise his alleged lifelong ambition of buying a house. The humbug of this has just been exposed by the extraordinary action, in the last two weeks, of the Tory council in Wandsworth.

This council decided recently to sell to a private property interest the council estate known as St. John's, bordering the river in my constituency. This estate was a pioneering effort by Labour councils in the 1920s, designed to rehouse families from the worst slums of those days. Three years ago the then Labour council decided that it should be wholly modernised. The Tories then took it over two years ago. Having decided to sell the estate to a private interest, the Tory council recently discovered that about 40 families refused to move out. The Wandsworth council then decided to evict them. We can see how much sincerity there was in all this talk about selling council homes to sitting tenants. In this case a Tory council is proposing forcibly to evict council tenants from their homes and to sell the estate to a private property interest, which will no doubt sell the flats to the highest bidder.

That is not quite the end of this curious story. The Wandsworth Tories also recently discovered that the Government's Housing Bill would give security of tenure to the council tenants, which would frustrate this whole operation of selling the estate. If this Bill becomes law in the next week or two, as I understand the Government hope, according to my information the enhanced security for council tenants would operate not later than early October. I believe that that is the latest state of the Bill. Thus threatened with defeat by their own Government's legislation, Wandsworth Tory council was so determined to evict these unfortunate people, at any cost to the council's reputation for responsibility, that it rushed through council last Thursday evening, 31 July, a motion authorising it to carry out the evictions at once, before the new Bill becomes law and the tenants obtain a new security.

This seems to be positively outrageous conduct on the part of the present majority on the Wandsworth council. I urge the Secretary of State to intervene in this affair and prevent the Wandsworth council from, in this case, defying not merely all principles of responsibility and decency but the intention of Parliament and the Minister's own legislation.

I understand, and the Minister can tell me whether I am wrong, that the sale of this estate to a private interest would require the consent of the Secretary of State. I therefore repeat the request that I made in a letter which I sent to the Secretary of State last Thursday, to withhold his consent to this sale. I would have thought, if there is any sincerity left in the Government's professed concern for the security of council tenants, as set out in the Housing Bill, that the Secretary of State could prove it by disallowing this sale. I therefore ask the Secretary of State to do so. I can assure him that he would immensely relieve the anxieties of 40 families on this estate if he would do this immediately.

2.15 am

I shall be reasonably brief as I wish to allow ample time for the 19 Opposition Members who wish to take part in this debate. Some of them have been unaccountably detained at meetings elsewhere, but no doubt they will contribute to our proceedings later.

I congratulate the right hon. Member for Battersea, North (Mr. Jay) on initiating this debate. I always regard him as one of the original prophets of doom. Whether he is speaking about the Common Market or housing in Wandsworth he always seems to paint the same dreary picture and he was his usual lugubrious self tonight.

I shall not follow in the parochial matters which the right hon. Gentleman raised, but I think that the first thing that should be said is that the problems of London cannot be considered in isolation. Of course, London will benefit when the upturn in economic activity comes. We shall have to wait a little longer for it but not too long, I hope. But it would, surely, be unrealistic to expect Government assistance at present to be directed specially and specifically to the capital.

I take up two points on housing made by the right hon. Gentleman. First, there is the matter of the transfer of GLC properties to the boroughs. I think that he misunderstands the views of most tenants in greater London. Those with whom I have contact have welcomed the fact that they will not now be administered from what they regard as the remote area of county hall but will instead have more direct, and personal, contact with their own boroughs. I think that most of them prefer that.

When the right hon. Gentleman spoke of the private sector I was sorry to note that he made no mention of the provision in the Housing Bill for shorthold tenancies. That is a provision that will be of direct help and benefit to people like teachers, nurses and students who will never be able to accumulate sufficient points to be rehoused from a council waiting list and who will, therefore, be looking to this provision to enable them to move into the accommodation for which they yearn. I believe that the Labour Party has done a great disservice to those people by threatening to repeal that provision and I hope that it will have second thoughts on the matter.

As this debate is about Government assistance to London we should range a little wider than housing, upon which the right hon. Gentleman concentrated in opening the debate. I wish to mention particularly the enterprise zones which have been proposed and which are in the process of being set up.

I am sure that the hon. Gentleman realises that the Government have decided not to declare part of Wandsworth as an enterprise zone.

That leads me to something that I was about to say. I share the disappointment expressed in some quarters that only the Isle of Dogs has, as yet, been designated as an enterprise zone in London. But I am bound to comment on the ambivalent attitude of the Labour Party on this matter. On 2 May in our last debate on London, the hon. Member for Hackney, South and Shoreditch (Mr. Brown) ludicrously equated enterprise zones with sweatshops. Now I understand that the right hon. Member for Battersea, North is complaining that there is not to be an enterprise zone in Wandsworth.

I am interested in the right hon. Gentleman's non-committal attitude on this. I can tell him that my hon. Friend the Member for Putney (Mr. Mellor) is most disappointed that an enterprise zone has not been designated for North Wandsworth. I know that he intends to press the Government to designate one there in addition to that in the Isle of Dogs.

It is interesting to see this ambivalent attitude within the Labour Party, and not just on the Labour Benches in this House. Although the Labour Party has opposed enterprise zones, a number of Labour councils appear to have been falling over themselves to make applications to the Government for zones to be designated in their areas. Of course, they want the jobs and opportunities that will come from such designation, bringing as it would exemption from development land tax, from industrial and commercial rates and from industrial development certificate requirements, 100 per cent. capital allowances on industrial and commercial buildings, and substantial relaxation of planning controls.

All this must give a tremendous boost to the development potential of these derelict and rundown areas in London and elsewhere, and will provide jobs in the very areas where unemployment is at its worst and most intractable. At least the enterprise zones are a new idea that should be tried, and I greatly regret the dog-in-the-manger attitude of Labour Members on this project.

The Government have already taken a number of measures to revive and encourage activity in London. Office development control was scrapped a year ago. The Location of Offices Bureau, the Labour Party's chosen and cherished instrument for the dispersal and loss of jobs in London, has been abolished. In addition, further Civil Service dispersal from London has now been virtually halted. All this is a useful start in helping to retain jobs in London at a time when the capital, in common with all other parts of the country, faces a growing problem of unemployment and recession. At the same time the Government are trying to soften the impact of unemployment, particularly among young people—

Yes, and I shall spell out precisely the way in which that is being done. We are spending more on training measures, particularly for young people, than the Labour Government spent.

The hon. Gentleman may also like to know that his Government cancelled a skillcentre that was proposed for my constituency by the Labour Government.

I have no knowledge of that cancellation, but over the country as a whole more money is being spent than under the previous Government. By Easter next year, for example, every one of this year's school leavers, in London and elsewhere, will have been offered a job or a training place under the youth opportunities programme. In the current year the programme is being expanded to cater for up to 260,000 entrants compared with 210,000 last year, which is an increase of 28·5 per cent. That, against a general background of public expenditure cuts, is no mean achievement on the part of the Government. It indicates their commitment to ease the problems of unemployment in areas like London. It emphasises the importance we attach to better, fuller and more comprehensive training. Incredibly, even today employers in London are still complaining about the difficulty of recruiting skilled staff. London's evening newspapers and our local newspapers are still full of advertisements of job vacancies for the right applicants. If the present employment difficulties bring home to young people and others the vital importance of obtaining better qualifications and becoming more skilled, our present troubles will produce a positive spin-off for the future.

I hope that this will prove to be a useful and constructive debate, reflecting the concern of hon. Members in all parts of the House about the problems of our capital. There are no quick or easy solutions. It is my submission that the problems of London can ultimately be tackled and solved only in the context of the revival and recovery of the economy as a whole. As soon as we have conquered inflation, that revival and recovery will be under way and will gain momentum.

2.25 pm

It is right and proper that the House should consider the position of London. When many people think of London they think of Buckingham Palace, Piccadilly Circus, Trafalgar Square, Soho and plush five-star hotels. However, those of us who represent London constituencies know that London has much bad housing and that in some inner London boroughs unemployment is as bad as in any region. Under the previous Tory Government we had a three-day week. For many young people under this Government there is no work. Our younger generation is coming from school to the dole queue. We are entering uncharted waters. In some multiracial areas in London there is danger of riots. As frustrations build up, the temptation for some people is to lash out at the nearest scapegoat.

In the borough of Newham the local council is wrestling with the most severe financial difficulties. In the past couple of weeks the council has been requested by the Department of the Environment to revise its expenditure and lop £3·3 million off the 1980–81 figures. There were veiled threats about what would happen if it did not do so. The figure is arbitrary. It is based on the figure for 1978–79, which was cut voluntarily by the council by £2½ million. The council budgeted this year for a contingency fund of £12½ million to cover inflation, which has soared way beyond estimates. Eleven million pounds of that sum has gone in the first three months of the financial year. The council has therefore had to draw on the £6¾ million in the capital and revenue support fund, which has been accumulating over a number of years. That fund will be exhausted by the end of the year. There will therefore be a complete stop on all future capital projects.

The council is trying to save £1 million in staff and produce a further £1 million in even higher rents, which are to increase by a further £1.50 a week. That is still not enough. The council has therefore decided to bring future housing projects to standstill, which is a scandal in an area of high housing stress. I have a constant stream of people coming to my advice bureau with housing problems. Like my right hon. Friend the Member for Batterea, North (Mr. Jay), I have to tell them that there is no chance of improvement while Tory policies remain. This year is bad enough. Next year will be desperate, because there will be no fat from the capital and revenue support fund. The maximum benefits from restriction on the recruitment of staff will have been realised. The only further savings will be in the form of drastic cuts in services. Those will fall on the weaker sections of the community—the handicapped, and so on—and will worsen the quality of life in an already deprived area.

The Government say that they have no money, but they have plenty for other things. There seems to be plenty of money for defence. The Government can spend £5 billion or £6 billion on Trident. What is the purpose? The purpose of those billions of pounds is to destroy cities in other parts of the world and to incinerate their populations. That is appalling.

I want to see a change of Government and of policy so that we may spend billions of pounds, not on destroying cities, but on building up London and the decaying inner areas of other cities in this country.

2.31 am

I suggest to the hon. Member for Newham, North-east (Mr. Leighton) that the objective of Trident is not to destroy cities in other parts of the world but to avoid Tridents, or whatever they may be, belonging to other countries destroying our cities. In other words, it is the reverse of what was suggested by the hon. Gentleman.

I am sorry that the right hon. Member for Battersea, North (Mr. Jay) is not in his place. I was talking to him earlier. As the hour approached 2 o'clock, I thought that we might miss the debate, I want to comment on what he referred to in Wandsworth. My constituency lies in Lambeth alongside Wandsworth. I have seen in the local press comments about the block to which the right hon. Gentleman referred. If the facts are as reported in the press and as stated by the right hon. Gentleman, there must be some cause for concern. Perhaps the Minister will have something to say about that matter when he replies to the debate. I am glad that Labour Members are as keen as me that people should own their houses, whatever the circumstances.

All hon. Members must be aware of the difficulties facing urban centres not only in this country but throughout the world. We have the famous phrase "urban centre decay". When I first entered the House 10 years ago, Lambeth had five constituencies each of 50,000 or 60,000 people. There are now four. After the next redistribution, there will be only three. I trust that I shall continue to be fortunate enough to represent one of them after the next election.

There is a flight of population from our cities and from London which must worry all who represent urban constituencies. I must agree that money, or the lack of it, has a bearing on what happens in urban centres. But I suggest that money is only part of the answer. I agree with my hon. Friend the Member for Ravensbourne (Mr. Hunt) that as the tide comes in every ship will rise with it, but I suggest that in London money is only a small part of the answer to the problem.

I remind the House of what has happened during the past 10 years in terms of planning because of too much money. Good properties have been knocked down by bulldozers and horrors have been built in their place. I have only to drive round the Elephant and Castle to remind myself of the horrors which are perpetrated by planners when money is available. I often wonder how much better that area might have been had they not had the money to create that hideous monstrosity.

If money had been available five or 10 years ago to do the same thing to Piccadilly Circus, as was planned, we would certainly regret it now. Fortunately—hopefully—it looks as though we may get something reasonable in Piccadilly Circus. I suggest that hon. Members should look at Covent Garden, where an excellent job has been done. I suggest that they should pay a visit there if they have not already done so. That was achieved without much money. A certain amount of private money was involved, but it was done with imagination and skill.

I do not accept that scattering money over our capital city will cure its problems. However, as hon. Members have already said, the main problem that we all know—the problem that confronts us at our advice bureaux and in the letters that we receive—is housing. Housing causes more misery to my constituents than anything else. I am sure that the same applies to the constituents of other London Members. If ever a road paved with good intentions has led to disastrous results, it has been housing legislation in the last 50 or 60 years, and every party has been guilty.

While I strongly support the Housing Bill, which returns to the Chamber tomorrow, I wish that in some respects it were bolder in helping the privately rented market. It seems to me that the use of local government as a solution to our housing problems—which Labour Members have emphasised—has been proven to have failed in the last 10 or 20 years.

We all have enormous housing queues, yet we all have more local government housing now than we had in the past.

I understand that housing is worst in Scotland, yet Scotland has the highest percentage of those living in council houses. Surely that cannot be a coincidence. Perhaps it is, but it is a jolly odd one. But Lambeth, which has 11,000 people on the waiting list, has a council that is notoriously inefficient in housing its people. There are more than 4,000 empty flats and houses owned by Lambeth council, some of which have been empty for up to four years. How can that be possible? How can one justify it?

I receive pathetic letters from constituents saying "I am in a desperate housing situation", and clearly they are. They attach a list of perhaps half-a-dozen addresses of empty council houses which they have found within a block or two of where they live. Perhaps the answer is to think laterally and to ask "Is not the way to do it through short-hold tenancies?". Again, I agree profoundly with my hon. Friend the Member for Ravensbourne. I fear that the Labour Party has knocked the shorthold tenancy scheme on the head by saying that it will repeal it. If that is so, that is a terrible thing to have done. It should have allowed the scheme to operate for four or five years. Heaven knows, we need new ideas in respect of housing in London, because it is the main area of misery. I do not believe that local authorities or the Government are able to solve the housing problem. They may be able to do so partly, but the other part must be achieved through the privately rented market.

I was talking to the boss of a distinguished housing association which is not normally associated with Conservative policies. In other words, it has the tendency to be a rather Left-Wing organisation. He had just returned from the United States, and he told me "You know, slums in the States are very bad, for instance, in Washington". I asked whether they were any worse than those in some of our cities. He replied "No", but he added "The extraordinary thing was that there is no shortage of housing to let. Anyone can get a house at a very reasonable rent, and rents are less than they are in this country. I cannot understand it". I said "You don't think it could possibly be because they do not have such a regulated market in the private sector?". He said "No, it could have nothing to do with that at all, but nevertheless, I don't understand it".

Therefore, one day a party will be brave enough, or in power long enough—it will not be the Labour Pary, so I hope that it will be the Conservative Party—to start freeing the private market to allow private money to come back into housing. That is the way that we shall get mobiliy. That is the way in which we shall reduce some of the misery. I do not see it being done through public sector housing.

Will the hon. Gentleman explain how this system for defeating housing waiting lists will work with the private landlord taking precedence? Does not this mean, in very simple terms, that the rate of profit for the private landlord will have to be raised to a considerable extent to make housing a profitable investment over and above any other form of investment in the economy, either in the financial or the industrial sector? By how much will rents have to go up in order to give that profit premium to the private landlord to create the thousands of dwellings needed?

I do not think that there is necessarily any conflict between the private sector and the council sector. I do not see why they should not work in harmony, as they do in most countries in Europe. There is no conflict between them in Scandinavia. There need be no conflict between them in this country. The hon. Gentleman has a very good point. The problem is that the private market is so strangled at the moment and there is such a shortage of housing that if it were freed there would be unacceptably high rents asked overnight, until the market had expanded sufficiently. It would probably take five or 10 years to do so.

That is why the Conservative Government introduced in 1972 the excellent Housing Finance Act. Had that not been repealed by the Labour Government, it would by now be having the sort of effect that I very much hope to see one day. But I shall not follow that line because it is a difficult one and it is very late.

Might we not, sitting as we do for inner London constituencies, at least have common cause in certain aspects of housing which create grave problems for our constituents? Might we not have some sort of crusade among us to stop councils, because of their inefficiency, from keeping houses and flats empty? Might we not move to press for some kind of central computer so that there can be mutual exchanges taking place more freely and more quickly? Might we not in some way between us see whether we can help our constituencies with their major problem—that of housing?

2.43 am

The range of issues to be discussed in the debate this evening highlight yet again the need for a Minister with sole responsibility for London. This has been suggested, I know, on many occasions. We are all aware of the excuses that we hear time and time again. I do not believe that, on whichever side of the Chamber we sit, we believe those excuses. The time will come when there will be a Minister with responsibility for many issues that face us in London.

London, the capital of this country, is a hell of a mess. We who represent the inner areas especially wonder at times what is our long-term future, because we have all the problems. Solving them is never easy. With a Government such as we have now, following the kinds of policies that they have been pursuing since their election a little over a year ago, in the inner Iondon area and in many of the outer areas we are starting to become what can only be described as a desert of despair. When we run through the list of our problems—housing, employment, the environment, traffic, transport, industry—we find that it goes on and on and on. I am sure that each and every hon. Member can bring into a debate such as this the problems that beset the areas that he represents.

I shall talk about London Transport and industry. Recent weeks must have filled many Londoners with utter confusion as they heard of the to-ings and fro-ings at County Hall on the issue of London Transport and what was wrong with it.

We all know that London Transport has lost an enormous sum. I am told that the loss is over £130 million. We know that buses and trains do not run, or do not run on time. We know that buses are out of action and that there is a shortage of staff. London Transport gives us every possible excuse for not providing the service that Londoners look to and need to have if they are to be able to find employment and travel from their homes to it.

We do not need any surveys to ascertain what is wrong with London Transport. All that the powers that be at County Hall or 55, The Broadway, need to do is to send out a few representatives to any bus stop to ask those who are waiting there what is wrong with London's bus services. They will soon be told what is wrong. It will be said that they are unreliable, too expensive and inefficiently run.

The Greater London Council is now responsible for London Transport. "Mr. London", the man who can pick gimmicks out of the sky quicker than anyone else—I refer to Sir Horace Cutler, the leader of the GLC—should be familiar with these issues. Whenever one switches on the radio or even the television one hears Sir Horace being interviewed. He speaks at great length about his knowledge of various subjects. However, it seems that all the problems of London Transport are someone else's fault and most certainly not Sir Horace's. The fault lies with the workers, the chairman or the late chairman but not with Sir Horace.

We are entitled to ask what Sir Horace has been doing. The final responsibility for London Transport rests with the GLC. The leader of the GLC should know as soon as things start to go wrong. I suggest that Sir Horace has failed the people of London and London Transport and that the sooner he goes the better it will be for everyone who lives in London.

Does my hon. Friend agree that Sir Horace has a direct responsibility, having himself appointed the bulk of the London Transport board, including the chairman whom he has recently dismissed and the deputy chairman, who was so precious to London Transport that he had to be given a special financial relationship so that his salary was paid to a private company?

My hon. Friend raises a valid argument. However, Sir Horace says "It is not really my fault. Those in whom I believed have let me down." Those who live in London and represent it, know the gimmicks and the wriggling that Sir Horace Cutler adopts. As Members of Parliament for London constituencies, we should discuss when we will provide Londoners with the transport system that they need. At present, we drive people away from public transport and towards using other forms of transport to reach their places of employment or to travel to functions. They simply say that they cannot rely on London Transport and that it is therefore up to them to find their own means of transport.

If we allow that to happen, things will escalate and will become even worse. It is regrettable that the service loses money, but it is nothing new. Few transport systems in the world make money. However, there is a vast difference between our policy and the policies of other countries. Other countries are prepared to give generous grants to ensure that their transport systems can provide services at fares that people can, and will, pay.

In September, there will be a 12p minimum fare on buses, and a 20p minimum fare on trains. That will be the third increase in a year. The increase also means that fares will have gone up by 45 per cent. since September 1979. I am sure that no hon. Member doubts that when such increases take place, people stop using public transport. Given recent events at County Hall, no one could suggest that Sir Horace Cutler has paid any constructive attention to this issue.

I should be interested to know whether the Government have had recent discussions with the GLC about the plight of London Transport. Are the Government satisfied with events under the leadership of Sir Horace Cutler? What steps will the Government take to ensure that there is an adequate transport system for Londoners? In particular, I hope that the Government will give some financial aid to London Transport. Unless help is given, and unless there is a dramatic change of policy, London Transport will soon grind to a halt. Those whom we represent will suffer. Anyone who disputes that should go to Whitehall in the rush hour and should look at the numbers of those waiting for buses. They should talk to some of the people. At first hand, they will hear the despair that they feel about the service that they want, but that is not, unfortunately, forthcoming. If something is not done it will be a sad day for London Transport, and for the people of London.

I should like to turn to the subject of industry and employment in London, particularly in inner London. As a Member of Parliament for a south London constituency, I have seen the position worsen year by year. No hon. Member will dispute that we have allowed too many of our basic industries to move away from London. That was a mistake. The Government's policies affect London as much as any other area. The nature of London, with its appalling housing and the rundown of the environment, makes it explosive.

It is a tragedy for anyone to be out of work. If one is young—and especially if one is black—and one lives in South London it is more than a tragedy to be out of work. Young people feel that society has let them down. Year after years at school they have been told "Study hard, take exams, try to do well and respect authority and you will get on". The only way that they get on is to get on to the dole queue.

Unemployment of a little under 2 million does not give the full facts of the inner London area. There is little industrial base. The opportunity for apprenticeships diminishes week by week in many places. The lack of training opportunities has also been reduced drastically, as my right hon. Friend the Member for Battersea, North (Mr. Jay) has already said.

Parents now come to my advice service asking whether I am able to get their youngsters a job. They do that because they share the despair of their youngsters about not being able to get work, however much they try and want a job.

The Prime Minister and her Ministers say that inflation is the overriding issue. When comments such as those made by the Prime Minister are heard by my constituents they are regarded with utter contempt. My constituents see a Government who are not concerned with their problems.

The great anxiety of business men about Government policy is of the high interest rates which they have to pay if they want to borrow money to expand. They are also worried about the unfair competition posed by goods coming into Britain from overseas. They are worried because the Government are killing off industry so that even when things start to look up the industrial base will be so destroyed that the opportunities for industry to revitalise and offer jobs will not be there. Unless we in London start to receive Government help, the problem will get worse. Anyone who thinks that those in London, especially the young, will sit by and accept that is out of touch with the feelings of our young people.

If we hope to be able to develop a realistic industrial future for our city, it is surely common sense to spend money to create basic training and employment. The problem is particularly pressing now. Not only have we lost our industrial base, which provided an enormous number of job opportunities in the past, but the Government have imposed cuts on many of the service industries that also offer job opportunities. As a result, there is a reduction in the number of jobs and apprentices that are available.

South London is a million miles from Finchley and Surrey, East, the constituencies of the Prime Minister and the Chancellor of the Exchequer. They should not just pop in for half an hour or so and say "Things are a bit rough now, but they will start to improve". They should spend time walking round areas such as South London, listening to what the people say and seeing how depressed those areas have become, certainly in the past 15 months while this Government have been in office.

If we are to have a viable future that offers hope for our people and are not to become a city in which the overwhelming percentage of the population is elderly or retired, we must have more constructive help from the Government. Young people will not accept that they cannot get a job, but, tragically, that is what many of them are starting to feel.

It is time that the Prime Minister and her Ministers realised that the one thing that the British worker wants, wherever he lives, is constructive employment. Our workers are not layabouts or scroungers, as the Prime Minister repeatedly suggests. She is always saying that they should work harder and change their attitudes, but many hon. Members can give examples of workers showing a constructive attitude to their companies, only to find that, as a direct result of Government policies, their jobs disappear and they become redundant.

We are all aware of the number of company failures in London over the past few months. Unless the rot is stopped—and only the Government can stop it—the situation will become even more serious. The Government's policies are causing the problems.

The Miniser, as a fellow Londoner, must find that his constituency is suffering from the same sort of problems that many other parts of London are suffering from. We look to him to give us hope that the Government are aware of the problems and will give us help that will lead us to rebuild the future of this great city.

3.5 am

It would normally be proper at this hour to say to the House that I shall be brief. I apprehend, however, that the House wishes to stay on. I should like to take up the theme of jobs and job opportunities, to which previous speakers have referred. We have a major crisis on our hands in London. That crisis is not of people looking for employment but of job vacancies. I am sure that hon. Members will find the facts I shall relate of particular interest. The Department of Employment has explained the situation. The Manpower Services Commission, the jobcentres and the employment agencies, in a survey carried out during the month ended 12 June 1980, recorded 41,992 job vacancies in London. The survey states that about one-third of all vacancies in the economy are notified to the Department of Employment and its various agencies.

The plain truth, as many hon. Members well know, is that there are about 150,000 job vacancies in London. There are certain institutional employment opportunities. The Metropolitan Police, for example, has no fewer than 4,000 job vacancies. These are well-paid jobs with a career structure and excellent pension opportunities. There are also vacancies in the Post Office. It is difficult to get telephones installed in central London or letters delivered because of a shortage of trained engineers and postal workers to sort and deliver the mail. One could go on, industry by industry. The casual observer, reading the London evening newspapers or local newspapers, will see column after column of advertisements of job vacancies.

I have also taken the trouble to bring into the House the latest figures of the Department of Employment on job vacancies. I am astonished by the figures that the hon. Gentleman has given. I should like him to reflect on the Department's latest figures published on 4 July which show that the seasonally adjusted total of vacancies notified to the Department in Greater London was 27,900, not the figure that the hon. Gentleman gave. There was a substantial reduction of 4,600 job vacancies between June and July. Those figures cannot be reconciled with the figures that the hon. Gentleman has given. I suspect that he is reading the unemployment figures and not the vacancy figures.

I am grateful for the hon. Gentleman's intervention. It enables me to say, again with complete frankness, that I have information, received in a written reply, which clearly states that 41,992 vacancies were notified to the three London employment service division areas. The reply went on to list in great detail the employment office vacancies throughout the London area. I will refer to only a few. In Brixton, for example, there were 327 job vacancies; in Hammersmith, 1,006; in the City of Westminster, 4,345. There are also vacancies for professional and skilled people. The London professional and executive office had 1,709 vacancies. The hotel and catering trades group had 3,080 vacancies.

In London, many major employers are looking for people to work for them. The real question is why these vacancies are not filled. Perhaps we should look with greater care at the character of our population to see why some young people are unemployed in some parts of London, are unwilling to take some jobs, or indeed to move, or rather to travel, relatively short distances to take up the employment opportunities which are available to them.

Some people say that fares are the cause of people not taking up job vacancies. It is true that the average fare paid on the Underground is about £1, but this is generally reflected in the wages and salary offered, particularly by employers in central London, who know that if they are to fill their vacancies they must be prepared to pay a reasonable salary.

The quality of life in London is another aspect of the problem, and one to which we as London Members will increasingly turn, not only on the Back Benches but in the Government.

Many people say that they want all aspects of the quality of life improved. That means greater provision for open spaces, for trees and shrubs, for gardens and for children's playgrounds, and more attention to the character and quality of housing erected in London. There have been many serious mistakes, and it does not do to try to put the blame on one political party, since both have made mistakes, often from the best motives.

I am sure that we are all glad that the tower block is now a thing of the past and that it will not return to plague the London skyline and to provide the kind of accommodation in which most people would prefer not to live. But might we not occasionally consider the better use of tower blocks? Might we not designate a tower block for use by young single people, who would like to work for short periods in central London to obtain job experience or particular skills and who would welcome the opportunity? Many young people have great difficulty finding suitable accommodation. Perhaps we should try an experiment along these lines. It would be exciting and attractive to many people.

It is sad also that there should be so much objection by Labour Members to the Government's shorthold proposals, because they offer an opportunity for ordinary people to make use of their homes, to bring spare accommodation into use to enable young people, particularly, to have a home here in central London.

The quality of life is increasingly becoming a major issue for the people who live in central London. I can best illustrate that by referring the Under-Secretary to the pile of rubbish in black plastic bags outside St. Stephen's House, almost within the precincts of this House. The rubbish has been there for several weeks, and I have no doubt that it will continue to remain there. Why is this so? It is not that the city of Westminster, the local authority responsible for the refuse collection, is unable to fulfil its duty. It is simply that the law does not enable an inner city authority to exercise the powers that are necessary under the Control of Pollution Act 1974 to encourage the cafés and take-away food shops to remove this rubbish in a way that would be acceptable and is manageable.

I urge that further consideration be given to bringing into operation, perhaps within central London alone, on an experimental basis, sections 12 and 13 of the Control of Pollution Act.

This is a most serious matter. Millions of people visit central London. A few tens of thousands live in it. But it is the heart of the capital. It is the place to which tourists, from within the United Kingdom and from overseas, come. They have an expectation of cleanliness. They do not find it in our streets. This is quite disgraceful. It is an issue to which we should give greater attention if we are to enhance the quality of life in central London.

The transport system, referred to at great length by the hon. Member for Tooting (Mr. Cox), is also very important to the quality of life not only of the people who live in London but of those who work in it—the million-plus people who travel into London on a daily basis, apart from the visitors to the capital. The task of making such a transport system work effectively is extremely complex. Even the leader of the GLC, as able and talented as he is, has considerable difficulty in controlling the price and cost of oil and petrol, which contribute to the increase in the costs of the transport undertakings in London.

It has been suggested that there should be an improved transport system. But that requires people to run it, and if one has people for such a system, one must expect to pay the appropriate wages and salaries; that costs money, and that is reflected in the fares. These things go together.

I very much hope that greater attention will be given to the passage of vehicular traffic in London. It is a matter of concern that in central London the traffic warden service has fallen from an authorised establishment of 1,800 to about 1,000. Many of the streets in central London are becoming congested. This is serious because it prevents the free passage of buses and it obstructs the commercial life of central London. It means that businesses do not function efficiently. That, too, costs money. This is also an area affecting the quality of life for the residents and the people who work in London which requires early attention.

I am glad to have had this opportunity briefly to intervene in the debate. I shall not take up the time of the House further. Others wish to contribute.

3.18 am

But for the initiative taken by Opposition Members, the hon. Member for Paddington (Mr. Wheeler) would not have had any opportunity to debate London matters. While 19 Opposition Members put down their names for this debate, not one of the 50 Tory Members who represent London seats even bothered to do so. Therefore, we do not accept any criticism from the hon. Member for Ravensbourne (Mr. Hunt) or anyone else on that score.

Will not the hon. Member at least have the grace to concede that the present Conservative Government have provided time on two separate occasions within the last 15 months for debates on London, the need for which was pressed upon the Labour Party when in government but was never acceded to? At least the hon. Member will acknowledge that.

That is one of the more irrelevant remarks to have been made from the Conservative Benches. The debate is on the Consolidated Fund Bill. There is always at least one such Bill, and there are frequently two, in any Session. My hon. Friend the Member for Hackney, South and Shoreditch (Mr. Brown) has had a considerable hand in achieving such debates as we have managed to have on London issues.

The role of Conservative Members appears to be that of scavengers off the Labour Benches. I was going to say that they were snappers-up of unconsidered trifles, but having listened to them I must say that their speeches splurge forth with unconsidered trifles, particularly in relation to the employment and unemployment figures, which we have just heard from the hon. Member for Paddington. I am sure that one of my colleagues will deal with that matter.

I find myself reverting to what I said in my maiden speech, not because I was right but because I was wrong. I said:
"the people I represent have much to fear from any erosion of public expenditure on housing".—[Official Report, 16 May 1979; Vol. 967, c. 269.]
That was true, but what those people face with the present Government is not the slow process of erosion, not a general, gradual decay and wearing down, but the consequences of a catastrophic attack on public expenditure on housing, which is having a dramatic effect on their housing standards and prospects. It will have an even more dramatic effect as the months go by.

In February of this year the Secretary of State for the Environment announced his housing investment programme allocations. With the sleight of hand that has become characteristic of him and his departmental Ministers, he managed to put across the message that the cut compared with the previous year was 21 per cent. That was achieved by presenting figures that did not compare like with like. Once people had had an opportunity to look in detail at the figures, it turned out that they represented a cut of no less than 38 per cent., quite contrary to what the Secretary of State and his departmental press releases said.

That was not all. The public expenditure White Paper showed that compared with the £5.3 billion expenditure on housing in 1979–80 the Government intended to achieve by 1983–84 a total expenditure of only £2.7 billion, roughly halving in real terms the expenditure on housing over the next three years. The Government did not deign to give us any indication of what sort of breakdown they intended to use in achieving that reduction—reductions in capital expenditure or a reduction in the subsidies on rents. There can be no way out of it; if the money is to be reduced by roughly half, that will be done by massive reductions in capital expenditure, massive increases in rents, or a combination of the two. The Secretary of State has stalwartly refused to provide any indication of how the reduction will be achieved, other than to give us the rather unpleasant assurance that whatever happens the reduction will be achieved. The Environment Committee, in its first Report, considered the effects of the public expenditure reductions. In paragraph 16 it said:
"By comparison with rent levels in 1979–80 this"—
the Government's guesstimate of rent increases—
"would represent a real increase of 16 per cent. Most of the future reductions in housing investment would occur as soon as 1981–82 and the reduction over the two years between 1979/80 and 1981/82 would be very large, at over £1,000 m."
That is quite a dramatic reduction in the amount of money being spent on housing capital. I go on to quote from paragraph 17 of the report:
"Even assuming no further shift of investment resources from new building to improvement, public sector starts in England would fall from 66,356 in 1979/80 to 36,000 in 1981/82 and to under 30,000 in 1982/83 and 1983/84."
Those are not the figures just for London. Those are the figures for England and Wales. There have been years when the completion and starts figures for houses in Greater London have exceeded those figures which the Environment Committee predicts will result from the Government's reductions in capital expenditure for the country as a whole. That is a most important point which needs to be noted by the people of London since many of them, particularly in the central area, will bear the full weight of those reductions.

I quote what the Environment Committee predicts in paragraph 20, and I emphasise that this was the unanimous view of all members of the Committee—at least all those present at the meeting when the final text was decided. It said:
"The Committee considers that it is unlikely that new housing starts in the public sector in England will exceed a figure of 31,000 in 1983–84 and could be well below it in the period to 1983–84."
In his chacteristic way the Under-Secretary, the hon. Member for Hampstead (Mr. Finsberg), will no doubt come up with all sorts of variations on a theme, trying to prove that everything I have said is rubbish and that the Government's intended reductions in public expenditure on housing will not send up rents or reduce the number of houses started and completed, or in course of construction. He will also go on to say, I feel certain, that what is needed is for councils to sell houses so that they can use some of the money to build new houses to replace those sold.

I return to the all-party Environment Committee report, paragraph 23 of which says:
"Your Committee estimates that an average of between five and ten houses will need to be sold in order to build one replacement and therefore the discretion given to local authorities to use 50 per cent. of capital receipts from sales for investment will be of limited effect."
It goes on, and this is particularly important for inner London boroughs:
"We are also concerned that unevenly spread receipts from sales will in no way reflect the needs of different local authorities. In particular, authorities with a high proportion of flats would appear to be likely to have a relatively low number of sales."
The Committee consequently recommended that compensatory provision be made. It seems unlikely that that compensatory provision will be made, because the general drift of the Government's policies under the present Secretary of State—and I am sure encouraged by the Under-Secretary—is to penalise those authorities which will suffer most, as set out in paragraph 23 of the Environment Committee report. All those matters leave out such matters as the buying up of rundown property so that it can be improved, and the reduction in the amount of money made available so that councils can—at the exhortation of many private tenants—buy up privately tenanted blocks to give people effective security of tenure and to make sure that homes are properly maintained and, in that way, reflect the needs of the people who live in those blocks. Again, the hon. Member for Hampstead will be familiar with the process because he knows that a significant number of his constituents have pressed Camden council to buy mansion blocks in his area to protect them from the unscrupulous landlords who infest a great deal of our private housing and private rented accommodation. That money will no longer be available, as some of the constituents of the Under-Secretary know.

The other factor left out of those calculations is the money available for improvements. There may, at least, have to be an adjustment between the amount of money available for improvements and the money available for new building. It is clear that the deliberate efforts of London local authorities to buy up run down properties, because they knew that they were the only agencies that could possibly improve them, will be thwarted by the total unwillingness of the Government to provide the funds for such improvements. That is a disgrace.

Another point that should be made is that all the calculations about future rents and the number of housing starts leave aside the question of the decline in the amount and quality of existing housing stocks. As many Opposition Members know, and as Conservative Members who are not blind will have been forced to observe, a substantial number of council estates built just after the war and in the early 1950s are now in a state of considerable decline. Large sums of money will have to be spent if those estates are to be brought up to the standard people have come to expect and which they deserve. That money for the improvement of pre-war, post-war and even recent estates which were badly designed or built will not be available.

When the Select Committee took evidence from the Secretary of State for the Environment he, apparently, did not even care about the standard of housing that would result from cash reductions. He said—and the published evidence can be seen—that he was not concerned with updating the surveys of housing stock conditions. He said that that was a waste of time and he certainly did not intend to publish figures to enable people to compare those figures with what had happened and thus set standards. The Secretary of State, the Pontius Pilate of Henley, is in charge of the Department of the Environment and is responsible for the state of Britain's housing.

I had understood, until May 1979, that the Conservative Party supported the concept of housing associations. They certainly seemed to prefer them to local authority housing. But if one asks the housing associations how they are getting on now they say that they are getting on very badly because they are not receiving the money that they expected when they were inveigled, by both political parties, into taking on a much bigger job then they had previously done.

In my constituency there are a number of recently established housing associations and one might expect them, in a sense, to over-stretch themselves because they have limited experience of how to gear their activities. But there is also an old-established and reputable housing association, namely the St. Pancras housing association, which has been around as long as any hon. Member present tonight has been alive.

That association is in financial difficulties because of the changes which have been brought about by Government policy. It is also going into decline and finding things extremely difficult.

The hon. Member for Streatham (Mr. Shelton), who was so expert about the future of Covent Garden—half of which I represent—spoke about the contribution of the private sector. I feel obliged to turn again to what the all-party Select Committee on the Environment said about the contribution of the private sector. A number of hon. Members who are familiar with London's housing circumstances served on that Committee.

I quote from paragraph 30:
"They suggest that new legislation on private renting is unlikely to lead to any large net gain to the available housing stock. Your Committee concludes that the additional output from the private housing sector will at most make only a small contribution to offset the reduction in public sector investment within the period under review."
At the end of the next paragraph it reads
"By the mid-nineteen eighties there will be a cumulative shortfall of new construction, compared with the green paper forecasts, approaching half a million dwellings."
That is the sort of massive contribution that we shall get from the public and private sectors combined as a result of the Government's policies.

I believe that those policies will have their most acuute impact on central London. They will certainly have an acute impact on the area that I do my best to represent. I know that there are council estates, built before and after the war, which are now run down. They need a lot of money spent on them. The money is not there, however. I know that there are slum blocks bought from villains like Mr. William Stern, the man who managed to go personally bankrupt for the largest sum of money in personal bankruptcy in British history. He used to run slum property in the area I represent. He managed to go bankrupt on the rents that he screwed out of many of my constituents. All that property needs a massive injection of capital if it is to provide decent housing. That is being held up by the Government's policies.

I shall quote two cases. One is of someone who has been to my advice service three times. She moved out of the dwelling she occupied at the request of the council because the council was to improve it. The council ran into difficulties with the DOE about the design and cost of the rehabilitation. She wants to move back in when the rehabilitation has been completed. She has been to-ing and fro-ing for a long time. I do not suggest that the council is wholly blameless in the delays which have occurred in that case. Certainly, however, the DOE has made the major contribution to the difficulties by crawling over the details, objecting and jibbing at various stages to the proposals.

This lady told me of what I regard as the ultimate humbug when she appeared at my advice service last Friday and showed me a letter from 10 Downing Street—presumably sent on the Prime Minister's behalf—telling her that the DOE has now cleared the design and that no doubt the Camden council would be able to proceed with the rehabilitation, and would no doubt give it priority. That presumably was on the advice of the Department which knows full well that the council has already committed its entire housing improvement programme allocation to contracts to which it is firmly committed. It will certainly be in no position to enter into any little contracts to oblige 10 Downing Street. That letter represented a fair degree of humbug.

Another case bothers me even more. It concerns one of my neighbours whom I know reasonably well. Her husband had his foot and part of his leg amputated not long ago because of thrombosis. It was the intention of the Camden council to provide them with a ground floor flat instead of the third floor walkup flat that they have at present. A man with only one foot cannot walk up three floors. The couple do not want to move from the area with which they are familiar. They have a little shop. They are the small traders that the Government are supposed to be looking after. The council said that it would do up a ground floor flat just round the corner, so that the man could get about in a chair or on sticks. The reduction in money available to the council has meant that it cannot do up even that flat. All its funds are committed, as the DOE knows.

That is a small example of the human tragedy which is doubling and trebling in London and which will continue to do so as a result of the Government's amazing housing policies. Those policies are wholly heartless and were arrived at without consideration of the consequences, simply because the DOE decided that it would contribute at a certain level to the so-called reduction in public expenditure.

These services are vital to people in London, particularly in inner London. They are being cut at a time when the Government are indulging in preposterous expenditure by their commitment to the Trident missile and other lunatic prestige prospects, which are of no benefit and possibly of great danger.

It would be false to say that I hope that the Government will take notice of the housing problems of inner London. I am convinced that they will not, at least until a month or two before the next general election. I do not expect a sympathetic response to the problems of inner London and the problems of people in council housing or whose future depends on it. The major contribution of the Under-Secretary of State has been to try to persuade his right hon. Friend not to prevent the Jubilee hall at Covent Garden from being demolished. I am glad for once that the Tarzan from Henley prevailed.

3.42 pm

My hon. Friend the Member for Holborn and St. Pancras, South (Mr. Dobson) eloquently identified the problems. He also argued that London is short of debating time. The hon. Member for Ravensbourne (Mr. Hunt) said that the Government had given us two days, and we are grateful for the two Fridays. However, London is once again having to debate its affairs at 3.45 am. The first debate today was on the West Midlands, which only two or three weeks ago had a half-day debate. On Wednesday we are to debate the Eastbourne Harbour Bill. Important though that Bill may be, we have 92 London Members who wish to discuss London problems, and it is ironic that we have to do so at this odd time in the morning.

As my hon. Friend the Member for Tooting (Mr. Cox) pointed out, we still do not have a Minister representing London. Until we have such an appointment, London's affairs will not be taken as seriously as they ought to be. There is an anti-London syndrome in Governments and in all parts of the House. It is sad that we have to fight not only to stress the facts but to persuade some of our provincial colleagues that they are jaundiced in their views.

There is a continuing decline in industry and jobs in London. I was interested to hear the hon. Member for Paddington (Mr. Wheeler) and the contretemps on the different figures. I think that that contretemps will go on because we do not seem to be able to agree the figures for London. The GLC's figures do not match the Department of Employment's figures. There is a mismatch on the apparent vacancies available, yet we have this high level of unemployment in inner London. It is a cause for concern that we do not seem to be able to discover the reason.

Only yesterday I was with one Minister who came to my constituency to discuss industry and employment. We also had the benefit of the advice of his two principal officials in my area. Their view was that there were fewer vacancies, although the one bright spot in that misery was that more places had been taken up. In other words, although there were fewer places on offer, a greater number had been placed, as it were, during the past month. That did not answer the question why there appears to be this mismatch, but we all have our various views.

One of the principal problems has been the lack of training over the years. I represent a furniture trade union. Many cabinet makers, upholsterers and French polishers are now working for the Post Office. If the Post Office were to start making furniture at Mount Pleasant, it would make a profit because there are so many ex-furniture makers working there. It is a ludicrous situation, because the furniture trade industrial training board is trying to get people to become cabinet makers and upholsterers. There is something wrong with the matching of jobs and skills.

However, that should not blind us to the fact that London has had a severe beating during the past 20 years because an enormous amount of industry has been taken away. It was redistributed because it was believed to be right. Many of us, although adding words of warning, appreciated the need to help other areas. But now there is no industry in London. For example, the furniture industry, which used to be evident in my constituency, is now spread over the four corners of the land. High Wycombe, Thurrock, Chelmsford and other places have the furniture industry and London still has those who formerly worked in that industry.

London has been left with service industries only. Therefore, it does not have facilities for young people to enter into apprenticeships. There are no longer any opportunities for people to go into industry and to become skilled. I have heard it argued that London must come to terms with itself and promote service industries. I am not sure that is right. I do not know how we can convert 7 million people to the argument that London should have no manufacturing base. We appear to have lost the art of manufacturing in this country.

We have a deep-seated problem. This is what distinguishes London from other parts of the country. When the economy finally turns up, whereas provincial areas will be able to take advantage of it, London will not, because there will be no manufacturing jobs in the capital. We shall not be able to provide the job opportunities that people need. Therefore, the crisis for London will extend beyond the turn-up, whenever it comes. I counsel people to watch carefully the argument that we can accept that there is no need for manufacturing industry in London. That is a fallacious argument and should not be followed too closely.

I should like to take up some of the points which were made about public transport in London. Little by little, travelling in London is becoming almost impossible. It has become a hazard for those of us who live in the inner London area to get about by public transport. During the past three years we have witnessed the virtual breakdown of London Transport. For sheer incompetence, the Tory GLC takes some beating. Indeed, it has surpassed itself.

When Mr. Kenneth Robinson, former chairman of London Transport, was trying to get the thing into good order, he was regularly sniped at. As soon as the Conservatives took control of the GLC, they sacked him, not because he was incompetent or not doing his job but for typical party political dogma. In fact, Sir Horace Cutler decided on that spiteful action, which only he could be capable of. He sacked the man on the spot for no reason whatever, and put in his own placeman.

We get used to that sort of thing. I do not condone it, but nevertheless one gets used to it. Sir Horace Cutler put in Ralph Bennett, the great man who would solve all the problems. Not only did he place Mr. Ralph Bennett, but he placed other men as well. He even put in his mole, Mr. Leslie Chapman, in order to harass his colleagues. I do not quite understand the management technique that Sir Horace applied, but he did it.

The fanfare was that after all the years of failure, things would be different now that Mr. Ralph Bennett and all those other placemen were there. That was the high point of Toryism in London. Many of us just sat back and watched. We did not criticise it then. We waited and thought "We shall see what happens at the end of three years". What has been the result? We have a service which has almost broken down. We have a less efficient service, and we have a horribly expensive service which has resulted in fewer passengers.

In the last two weeks we have been told that we have a bankrupt industry. It was so bankrupt that it needed a special meeting at County Hall to try to resolve the problem. As a result, we had a sacked chairman. As has been said, if all else fails, blame the chairman, sack him and start off afresh.

That was the placeman who would do so much three years ago, along with all the others who were appointed with him. So much for Tory enterprise! The Tories have had complete control. They cannot make any excuses whatsoever. They cannot even blame a Labour Government because a Conservative Government have been in power for half the time. Therefore, they are bereft of any excuses. I suppose that we can say that they were appointed by Sir Horace Cutler, run by Sir Horace Cutler and finally ruined by Sir Horace Cutler. The saddest thing is that we now have an appalling public transport system, and we still have to endure Sir Horace Cutler for another nine months. Goodness only knows what further damage will be inflicted upon us before London finally rids itself of this expensive popinjay.

There has been an equally disastrous situation in housing, which has already been well illustrated. It has long been recognised that the housing problems facing inner London boroughs cannot conceivably be solved by the inner London boroughs themselves. They will need help from the outer London boroughs. What is more, they need the help of the GLC as the strategic housing authority. The original reorganisation of London particularly made the GLC. I was one of those who opposed the creation of the GLC. I did not think that it was necessary. I happen to be a boroughs man, and I said so in those days. I said so to the Herbert Commission. I was never very happy about it, but finally, when all the various reasons were put to me as to why we should have a second tier, the one thing that I was seized of was that a case could be argued for a strategic housing authority, because it was not possible, as I have said, for any inner London borough to resolve its own problems.

In the light of that, and in the light of the urgent housing problems that we have in inner London, the staggering story in housing after three years of Sir Horace Cutler is that he has abrogated his responsibilities for being the strategic housing authority. He has disowned his own responsibilities. In doing that he has kept large numbers of GLC properties all over London empty. He has kept them empty because, as he has argued, he wants them either to flog off to the people in the area or to hand back to the boroughs.

It was a deliberate policy, and in doing that he has made life impossible for people in a constituency such as mine where we rely entirely upon having an opportunity for people to move or transfer to other areas of London where their families are and where they prefer to be. Sir Horace Cutler has made it impossible for any of our tenants to be transferred. But he has gone further than that. He has not only made it impossible by keeping these places empty and making sure that no transfers take place. He has been running down the estates and neglecting repairs and maintenance. There has been a total and wilful refusal to plan, programme and build sufficient homes for the needs of London.

What is worse, perhaps, is that the GLC is deliberately refusing to provide sheltered homes for the elderly. In a debate such as this about a year ago, I drew the attention of the House to the fact that the Secretary of State for the Environment had just turned down a compulsory purchase order that had been placed by Hackney on a site which was seen to be most attractive for establishing about 40 sheltered homes for the elderly. The Secretary of State turned it down in favour of a speculative group.

I drew attention to sites in my constituency owned by this speculator. I said that it was a pity he did not do the work there before he took on other sites—in particular, the one where the sheltered housing could be put. This speculative body still has not touched the site in my area. It is in an appalling state The public health people are having to be called in frequently to try to do some thing about it. There is corrugated sheeting all round it. The whole place is a disgrace. It is not surprising that some people who see it think it must be owned by the borough council, whereas it is owned entirely by the speculator. Nevertheless, it was the Secretary of State's argument that he felt it was better for the speculator to have the site rather than to have sheltered housing on the site.

Recently in Hackney the GLC built some sheltered housing for the elderly and provided within those homes all the usual aids for the elderly—the warning lights, the various attachments to the bath, and so on. Then it decided not to allow these to be used for sheltered housing. So, having paid to put all these things in, the council has gone round removing all the warning lights, the attachments to the baths and the other things specially provided for sheltered housing in order that it can put the houses up for sale. That is a disgrace.

All hon. Members who represent inner London constituencies have elderly folk coming to them Friday after Friday in their search for sheltered accommodation. I cannot understand why the Department is allowing Sir Horace and his colleagues to behave in such an appalling manner. It is behaviour that cannot be justified in any circumstances.

We have heard a great deal about shortholds. We have always had a form of shorthold. It is not a new idea. Shortholds were once called furnished tenancies. They were exactly the same arrangement. A tenant occupied the accommodation for a limited time and at the end of that time he was bound to leave. The effect of a shorthold is exactly the same.

I ask the Minister to explain to me what will happen after one year, two years, three years, four years or five years, whatever may be the length of the short-hold, when the landlord tells his tenant that he no longer wants him. The landlord will have the inalienable right to put out the tenant and his family. There will be no council housing to turn to because that has finished. There will be no recourse to the council for help. Who is going to house families in that posi- tion? It was because people were being thrown out at the end of their "short-holds" that we introduced legislation to prevent that from happening. We are returning to where we started.

It is not true to say that we have never had shortholds before. Those of us who were chairmen of housing committees about 30 years ago well remember the basic problem of families being made homeless because of the shorthold system or the furnished tenancy system, which are one and the same thing.

I cannot envisage a shorthold system providing sheltered housing for the elderly. If the Government will not allow Hackney to provide it and they are prepared to stop the compulsory purchase order, and if the GLC will not have such housing because it is flogging off the units that it provided as sheltered accommodation, I ask the Minister who he suggests will provide sheltered housing for the elderly. He is directly responsible. He has chosen to stop the CPO in Hackney and he has permitted his friends in the GLC to sell off that which it provided as sheltered accommodation. The House is entitled to have a statement from the Minister that will explain who he thinks will provide the large number of sheltered housing units for the elderly that is required in the inner London area that I represent.

The GLC has acted to satisfy its doctrinaire party political dogma. In the meanwhile many elderly persons who are desperately seeking help from the councils are having to be turned away. It is a total disgrace. It is a deplorable state of affairs. The Tory GLC's record is a total disgrace.

The inter-borough nomination scheme is not working. The Minister relies on inter-borough nomination. The borough in the hon. Gentleman's constituency will not house people from Hackney. I asked Hackney officials to give me the names of the boroughs that were not offering accommodation to Hackney. The hon. Gentleman's beloved Camden was one of those boroughs. The chairman of the housing committee told me that there were difficulties. I advised him to tell the Minister as he, the Minister, did not seem to appreciate the difficulties.

The hon. Gentleman cannot rely upon the inter-borough nomination scheme. He has had the same responsibilities as I have had in years gone by. He knows that good housing is not put into an interborough nomination scheme. Most of the stuff that goes into that sort of scheme will be that which no one wants locally.

The hon. Member for Streatham (Mr. Shelton) talked about mutual exchanges. I do not know how much exchanging the London borough of Bromley has done. It might have done exchanges with Bexley, but it has not done any with Hackney.

The housing record of the London borough of Bromley is appalling. It cannot house the large number of those who require council accommodation. Indeed, it has no intention of doing so.

I have been known to suggest that the problem can be conveniently solved. The homeless of Bromley could be put on buses to Hackney. They could get off at the first stop. I accept that Bromley has never done very much.

Recently, the Minister was very kind to me. I wrote to him about an elderly brother and sister who wanted to get into a mobile home in Hammersmith. He was kind enough to involve himself immediately. He received an answer from Hammersmith to the effect that they were going to dismantle all the mobile homes. However, that is no longer true. I am told that Hammersmith will tart up the mobile homes, so that they can be made available to homeless families.

I invite the Minister to reconsider the case of Mrs. Bracey and Mr. Hutchins, and to discover whether Hammersmith can allocate separate mobile homes. They are very anxious to get into such homes. Indeed, Mr. Hutchins is now 73 or 74. I hope that the Minister will be able to help. However, that case again indicates that the inter-borough nomination scheme is not working. The Minister would be ill-advised to rely on it too much, and to argue that the housing problems of inner London can be solved in such a way.

London faces many problems. For example, we could discuss the problems of the Health Service. We could discuss other services, including the environmental services. In addition, the GLC is running down the fire brigade to a dangerous level. The fire brigade knows about such things, and it has offered me evidence to that effect. If it were thought that the evidence was incorrect we could argue about it. However, we cannot argue with anybody, because the GLC does not discuss such issues with anyone. Such subjects do not seem to be discussed at committee meeting any more. Discussion takes place behind locked doors, in smoke-filled rooms. Suddenly a press release is issued and something happens. I am very concerned about the situation.

Is not the hon. Gentleman aware that the Home Office has issued a Green Paper on fire brigade policy so that such points can be discussed in an informed manner?

I accept that, but the GLC took action first. It reduced manning levels before there had been any opportunity for discussion.

Is not the answer to the point raised by the hon. Member for Paddington (Mr. Wheeler) that an enormous fire tragically took place recently at Alexandra Palace, in my constituency, and that the firemen and officers told me—as their local Member of Parliament—that they had had to strip the fire cover of the whole of London. If there had been another major conflagration in London, the fire brigade would not have been able to deal with it, or with many of the usual minor household fires.

I am grateful for that information. My experience is the same.

We should be discussing many London matters, but we must wait until May for the first part of the dividend when we get rid of the Tory regime at County Hall. Although we must wait nine months, the damage that will be done will be catastrophic. Housing, transport and the fire brigade will be destroyed. The council is trying desperately to destroy the ILEA. It is having an orgy of destruction. However, at the end of four years it will not be able to point to one achievement other than the destruction of everything. The council is turning everything into a farce. Please God, we shall never have to suffer another Tory administration in London.

I hope that we can unite on one issue at least. We must ensure that we debate London affairs at a more reasonable hour on a more regular basis so that we do not have to discuss the whole range of issues every time. We should be able to identify areas of interests so that we can put the interests of Londoners more to the front than is possible at the absurd hour at which we have to have our debates.

4.11 am

We have had a wide-ranging debate. I wish to refer to some issues which have not yet been covered. First, I wish to reply to some of the points made by the hon. Member for Paddington (Mr. Wheeler) about the number of vacancies and the extent of unemployment in the greater London area. The hon. Gentleman has misconstrued the Government figures. I do not think that he is being deliberately misleading, but there are important points of principle about which we must get the record straight.

The Department of Employment's unemployment and vacancies returns each month are based on a single day on which the Department counts the number of men and women who are unemployed. It also counts the number of job vacancies in standard regions in the country. The figures obtained in that way are quite different from the figures which the hon. Member for Paddington gave to the House.

I am aware of the basis of the figures which the hon. Gentleman gave. They show a much larger number of vacancies in greater London than exist. The figures which he gave represent the number of vacancies notified to the Department during the whole of the month. The hon. Gentleman is talking about the velocity of circulation of vacancies that occurred during the whole of a calendar month. One of the most interesting things about unemployment and vacancy patterns in the area in the last few months is the extent to which vacancies have declined in conjunction with the decline in the other standard regions.

No reasonable person, looking at the figures objectively, could say that there is a substantial number of vacancies that exceeds the number of unemployed and leads one to believe that there is a mismatch between the available jobs and those seeking employment. That would be a fundamental misreading of the situation in London.

One has only to consider the Department of Employment's vacancy figures to appreciate the problem. Between July 1979 and July 1980, the number of vacancies in the United Kingdom fell from nearly 253,000 to 126,000. That is the impact of the recession on the United Kingdom, and it is clear that, although the number of vacancies notified to job-centres and employment exchanges is only one-third of the total, the economy is in a deep recession and that London cannot escape from that.

The hon. Member for Ravensbourne (Mr. Hunt) said that London faces problems that can be solved only by Government action. I agree that our major problems will be solved only by the Government taking responsibility for expanding the economy. The whole economic system is driven by two major factors—net exports and Government spending and taxation. The Government are hell bent on removing some of the major planks of employment creation throughout the country and particularly in London.

We have seen reductions in public expenditure and a substantial decline in net exports because of the overvalued pound. Those factors will drive the economy of London into a further, deep-seated recession and it will be revived only by a Government policy of reflation.

It is significant that no one has yet referred to the fact that London is the most vulnerable region in respect of public expenditure cuts, because of the high proportion of those in the region who are employed by central or local government or by other arms of public employment, such as the NHS. One of the most interesting aspects of the recent report by the Cambridge Economic Policy Group was its identification of Greater London as the area which had most to lose from public expenditure cuts.

In the present economic crisis, it is important for us to look at ways in which the Government could alleviate the problems of London and other regions. The Government's regional policy measures are increasingly being limited to areas with the worst social problems, which implies a greater reliance by the Government on the operation of market forces to produce a convergence between the economic performances of various regions. Market forces are supposed to drag the North, Wales, Scotland and Northern Ireland into line with the operation of the labour and employment markets and the production system of the South-East. To anyone with a shred of economic knowledge, that analysis is absurd.

The Prime Minister has said to the House on a number of occasions that if jobs do not exist in the North, Scotland or Wales, workers have to move to where the jobs are. That can mean only one thing. Workers will move to jobs that are currently available in London, the South-East and other relatively advantaged areas. I wish to analyse that problem. It is important that the House should understand the consequences of what the Prime Minister proposes. Individual members of the labour force in poor areas will decide to move to areas such as London where there are jobs. In those same areas, however, some people will take less good jobs than if they migrated. This will result, in turn, in someone in that region becoming unemployed.

The filtering down process operates in all regions so that the least qualified and the least experienced are more likely to become unemployed. They are the people likely to be at the bottom of the job pile. In London, this process has a particular effect. Outward mobility for people who might have been employed in central London or the suburbs until recently, has been further restricted because of the large-scale abandonment of the new town and expanded town policies. Inward migration from assisted areas will only increase under these free migration policies.

In London, the filtering down process will operate with a vengeance. Those made unemployed will have nowhere to go, because there is probably no region that will be more prosperous than the South-East of England. Their ability to move to find jobs is therefore totally circumscribed and the number of jobs that will be available to them will be restricted because of an inflow of workers from other parts of the country. The inevitable consequence of the Prime Minister's policies of workers moving to the job—involuntary migration—is the socially undesirable production of a pool of workers in London who are totally unemployable. These will be people with the fewest skills and the poorest education living in the inner city areas. Many thousands will be black.

Over the next 10 years, we shall see in London the creation of an extremely large and increasingly hostile pool of unemployed people. That is where the Government's policy is driving us. The House should be clear that it is the logical consequence of the Prime Minister's attitude to job mobility.

My hon. Friend is right. Are his remarks not illustrated by a Minister in the other place who said that one has to make people do a job of work whether they like it or not? Will not this approach mean that introduction of a chain gang-type situation, forcing people to undertake jobs such as breaking stones?

My hon. Friend is right when he argues that there are Ministers in the Government prepared to say that workers should be made redundant, receive unemployment pay and go back to performing the same job they were performing before they were made redundant in the guise of voluntary service or some other guise. So in that sense my hon. Friend is absolutely right.

The only protection which Londoners will have against the creation of this large pool of urban unemployed is the fact that inward migration will be limited by the very free market that the Prime Minister wants to encourage. The aspect which will discourage that migration is, of course, the house market. If house prices are sufficiently high in London, that will be the only guarantee of relatively high employment.

Therefore, under the free market policies pursued by the Prime Minister, there is a trade-off between homlessness in London—the inability of our society to solve its housing problem—and keeping relatively high and stable employment in London. That is a scandalous trade-off, which the Government should never advocate. But that is what the Prime Minister is saying.

The London area has substantial variations of unemployment. Such areas as Tower Hamlets, Hackney and my own borough have considerably higher unemployment than London generally or the country as a whole—certainly higher than the rest of the South-East. The variations between those parts of London and the more affluent parts such as north-west London, are greater than the variations between London as a whole and the so-called assisted areas.

The regional policy that the Government are pursuing—if one can dignify it by the term "regional policy", which I doubt—does not take that position into account. Thus we see the crude application of market force economics to London as a whole, and absolutely no understanding of the differentiation between different parts of London and their different economic problems. It is no exaggeration to say that in Tower Hamlets, Haringey, Hackney and other parts of inner London, the next few years are likely to see an acceleration of their relative decline in relation both to other regions and to the rest of London.

One of the Government's answers is that enterprise zones will be a significant and important answer to London's employment problem. I do not believe that. The enterprise zone on the Isle of Dogs is likely to produce, on current levels of industrial density, about 15,000 jobs—and that assumes that every inch of the zone is taken up by business enterprise. An input of 15,000 jobs into Greater London as a whole—even assuming that they were new jobs and not jobs taken from anywhere else—although welcome, would be a drop in the ocean of London's employment problems. I hope that the Minister will not have the audacity to make that argument: he must have more respectable arguments than that.

There are other problems over regional policy. One difficulty is ministerial responsibility. The Under-Secretary is responsible, through the Department of the Environment, for certain aspects of regional policy which affect London. For example, the Department of the Environment is responsible for the regional policy aspects of local authorities, for the urban programme, for the new towns, for inner city policy, and for regional planning in England—although that has been dismantled now. But the Department of Industry, another major Government Department, is responsible for certain other aspects of regional policy. The Department of Employment is responsible for employment and training. If one is talking about regional policy as a whole in the United Kingdom, one must consider the role of the Northern Ireland Office and the Scottish Office concerning regional policy in those areas, and one has to discuss regional policy as regards London in relation to those other parts of the United Kingdom.

There are at least six major Government Departments responsible in part for regional policy in the United Kingdom. Three of those relate to the situation in London. I do not suppose for a moment that there has been any serious consultation between any of those Government Departments about the way in which regional policy has affected London since the present Government took over. There has been no announcement of serious regional policy initiatives from the present Government because they believe that all the problems can be solved by market forces. I hope that this debate will produce a situation in which the Government will begin to think that regional policy has some part to play in alleviating the chronic problems of stress and unemployment in the inner city areas and in London as a whole.

The difficulties that we face because of the Government's attitude will be very serious over the next few years. The solutions that we might produce—these are relevant to the Consolidated Fund—are these. If the Government are prepared to spend only a certain amount on industrial support and regional grants and are prepared to do virtually nothing for London, other than the enterprise zone on the Isle of Dogs, presumably Opposition Members have the responsibility of putting forward serious alternatives for expanding employment and industrial development in the capital. These must cover a number of major areas.

First, sites in inner London should qualify for Industry Act financial assistance. That would produce a situation in which local authorities and private industrialists would be able to obtain money from the Government in order to create jobs in sensitive areas.

Secondly, local authorities clearly have a major role to play, and not only concerning their current functions. They ought to be given greater powers to clear sites, to secure land and to engage in trading and production themselves, because without the removal of the constraint of the restricted sites in London, which affects many industries, including some in my constituency, there is a great possibility that increasing numbers of factories will, as they have in the past, move out of London on to green field sites in Hertfordshire, Buckinghamshire, Kent, Surrey and Essex, simply because they can expand more readily in those areas and create employment there.

Thirdly, we have to argue for a general expansion of the economy as a whole. The industrial and regional problems of London cannot be solved by regional policy alone. They must be determined by the overall economic and political stance taken by the Government.

The economic consequences of the present Prime Miniser will be just as serious as the economic consequences of Mr. Churchill when he deliberately and cynically decided to move the economy back on to the gold standard in the 1920s. That decision provided the basis for the great depression and the great recession in Britain in the 1920s and 1930s.

I believe that the policies that the present Government are pursuing in relation to the economy as a whole are so appallingly naive that they will drive the economy into the deepest recession that it has known for 50 years, in which London will be dragged down to the status of a high-unemployment region, a region in which there will be a substantial number of unemployed people, which will see a relative fall in its prosperity, which will perhaps see an increasing inward migration of workers from other regions, and which will not be able to solve its serious social problems, to which many of my hon. Friends have referred tonight.

Without a clear indication from the Government tonight of their intention on regional policy and the expansion of the economy, no fine words from the Minister can convince us that they have got it right. We believe that they have got it fundamentally wrong, and we hope that they will change their policies as quickly as possible, or make way for people who will take the right decisions.

4.36 am

On Wednesday 23 July The Daily Telegraph had the following headline about the unemployment figures, which had reached a new peak:

"South-East Hit Hard As Jobless Soars To Peak Of 1,896,634."
It said in the article underneath the headline:
"Ominously, the normally prosperous South, including the Greater London area, has been particularly hard hit, with another 54,500 on the dole."
That sums up exactly what some of my hon. Friends and I wish to emphasise tonight—both the extent of unemployment in the Greater London area and its significance.

We have heard a great deal from the Prime Minister about the need for mobility among the work force. She has said that the Welsh should simply uproot themselves once again and flood into London and the South-East to find the many jobs that are allegedly available for skilled and unskilled workers. The right hon. Lady's remark, made in Wales, was made with the most crass insensitivity to the history of Wales and the many who suffered from harsh unemployment in the past and who had to tear themselves away to look for work elsewhere. How she could go to Wales and say that is almost impossible to understand. It is hard to believe that she actually said it.

The Prime Minister seems not to know what is going on in the country that she is, at the moment, governing. She fails to realise that not only is unemployment increasing in the Greater London area but the number of vacancies are declining sharply. My hon. Friend the Member for Wood Green (Mr. Race) gave the year-on-year figures. Even if we take the month-on-month figures, we find that the change since June in the seasonally adjusted figures for the Greater London area is a drop of 4.6 per cent. in the number of vacancies registered. Those vacancies continue to decline.

Two further matters emphasise the situation in the country as a whole, but particularly in the Greater London area. The Sunday Times has been publishing week after week in its business news section a column listing job losses, rightly headed "The Gathering Storm"—a lovely title. The storm is coming. The Government do not yet realise that it will hit them with the fullest possible force in the autumn. They do not understand the extent and nature of that storm and what it will do to them and to the country.

I shall go through that list of job losses, picking out only the months of May and June and the jobs affecting workers in the Greater London area. On 17 May, 600 jobs on the Isle of Grain disappeared, not for the simple reason that has been presented in the press, of an inter-union dispute. The whole situation on the Isle of Grain is much more complex than that. In June 280 jobs disappeared at Thermalite, the concrete block manufacturing plant at Grays, Essex. A further 1,700 jobs disappeared in the Port of London. Ford (UK) has asked for voluntary redundancies of 2,300 in its United Kingdom plants as a whole and that affects workers at Dagenham, and many of my constituents. Towards the end of June a further 400 jobs disappeared at Delta Metal brass rod factory in London. A further 120 jobs disappeared in the Chrysler London office.

Week after week The Sunday Times records these figures, rather like casualties in a war. In a sense that is what they are, casualties in an economic war. These are job losses that are not simply and solely due to lack of demand. These are not jobs which will necessarily reappear if the economic miracle which the Government seem to think will take place this year, next year, some time, takes place. They do not simply depend on loss of demand. They are part of the destruction of British industry which has been taking place and which has been sharply accelerated by the activities of this Government.

My constituency is a good illustration of this point. It was, as my constituents are apt to point out to me, a thriving manufacturing area. About 40 per cent. of the work force in Thurrock is employed in manufacturing industry. Unemployment in my constituency is now at not quite the national average. It is 6·3 per cent. It is certainly higher than the average for the South-East as a whole. What is worse is what is going on there now. Earlier this year an analysis of a large number of major firms in my constituency was carried out for me. Not one of those firms planned to recruit labour during the course of this year. Most of those firms were declining in terms of numbers employed, some through voluntary redundancies, some through natural wastage and some through actual redundancies, through closure of firms.

I have in my constituency about 500 unemployed school leavers as from this week. Hardly any will find vacancies in apprenticeships with Shell or Esso or Thames Board or Thames Case. The opportunities for apprenticeships there simply do not exist. In spite of the Prime Minister's boasts about the enormous opportunities in the youth opportunities scheme I estimate that about one in five of the school leavers in Thurrock will find a place on the youth opportunities scheme immediately. Other places may be made available to them later this year, but certainly many of them will go straight on to the dole. There can be no question of an offer of a place on the youth opportunities scheme or any other training course in the area in the immediate future.

Let me take one or two examples of the firms that are closing in my constituency. Last week Thames Board Mills finally sacked 800 workers. The British Paper and Board Manufacturers Association has given a good explanation of part of the reasons for those closures. The reasons given are interesting. They are high interest rates, imports, high energy costs and the high pound. Those four factors together have made it extremely difficult for British paper and board manufacturers to make a profit. They have made it virtually impossible for them to compete with firms in Germany, France, Canada and America. They cannot compete effectively and export their goods there.

Every one of those reasons and criticisms given by the Manufacturers Association are aspects of deliberate Government policy. The high pound, high energy costs, high interest rates and the refusal to protect our basic industries against imports are all important planks of Government policy. Notice that I said that the criticism was made by the Manufacturers Association. That association launched that fundamental attack on Government policy. It was not the trade unions, or the Left wing of the Labour Party. It was the Manufacturers Association and it has repeated its attack on Government policy again and again and has taken every opportunity to convince hon. Members on both sides of the House of what is wrong with Government policy and how it is utterly destroying that industry.

I take the Thermalite factory, referred to in The Sunday Times list, as another example. Redundant workers there are shortly to be joined by a small number of redundant workers—about 25—from another company in my constituency called Aerated Concrete. However, the workers in Thermalite represented by their shop stewards told me bitterly that they thought that the Prime Minister would be proud of them. Last year they negotiated a productivity deal. They cut down the number of hours worked and increased productivity in the company by 40 per cent. What do they now find? A year later the factory closes and they all lose their jobs.

There was a group of workers consciously, over a period of time, negotiating what they considered to be a good deal for themselves and their employers and the result is still closure. The reason for that is not high unit labour costs. The reason is simple. It is the impact of Government policies on the construction industry and, therefore, on that industry's need for basic building materials. The high interest rate policy has forced companies which manufacture the basic materials for building into liquidation or closure.

Nor is it simply the high interest rate policy that does that. The sharp cuts in public spending, especially on capital expenditure have had a disastrous impact on companies such as those in my constituency. There will be others as well, because the construction industry must be reeling under the blows which this Government are raining upon it. It must wonder whether it can ever recover on the production side. We find here that the direct impact of Government policies is raising unemployment sharply in my constituency. That means that there are no vacancies for skilled workers. There is no effort on the part of local companies to offer apprenticeships to young people who are genuinely and earnestly seeking employment.

The vacancies that the Prime Minister fondly imagines exist in London and the South-East do not exist in the way that she and some Conservatives seem to imagine. Of course, that means that the migrant workers who flood into London and the surrounding areas looking for work will find that there are no jobs and no homes either.

In my constituency, for the first time, a borough council, which under Labour had the proud record of starting a house a day every day since the Second World War, now finds under the Tory Administration from which it is suffering that no council houses will be built, and that the housing improvement programme that is desperately needed in an area where much of the housing stock is pre-war is sharply cut back and those houses will further deteriorate. That means a lack of jobs as well as of homes, and the social consequences of that will be disastrous for many families in my constituency.

My hon. Friend the Member for Hackney, South and Shoreditch (Mr. Brown) spoke earlier about those who say that it does not matter that jobs do not exist because workers can switch from manufacturing to service industries. It is not quite as easy, of course, to do that. It is difficult in my constituency, for example, to retrain redundant shiprepairers in their 40s and 50s and send them on expensive trains into central London in order to find clerical work.

That apart, something much more significant is happening in London and the South-East. Like the West Midlands, it is one of the relatively prosperous areas in which manufacturing industry is sharply declining. That shows that Britain is rapidly—much more rapidly under this Government—becoming deindustrialised. That tells us two things about Government policy—first, that the Government no longer wish to look to manufacturing industry in this country to provide the wealth for the future. I believe that the Government have it in mind to allow companies here to transfer production abroad—those companies that are the source of many of our exports—and fritter the oil wealth away on unnecesary defence spending. In that way they will jettison our future for the sake of the present in the hope of winning the next election.

Does my hon. Friend recall that in The Observer on Sunday a figure of £ 3 billion was given as the net outflow from the United Kingdom after the lifting of exchange controls by the Government last year? Does she believe that the money could have been used more effectively to increase the social wage and to increase employment in manufacturing industry? Would not that money be useful to assist the depressed areas in the South-East as well as the North?

That is the point that I wished to develop. My hon. Friend attempted earlier to put forward constructive policies by rightly reminding us of the need for a proper regional policy in order to prevent migrants from flooding into London and the South-East, thus adding to the unemployment figures and the social problems there. This money should be used constructively in London and the South-East. The paraphernalia of Government intervention is available. For example, selective assistance for industry could assist failing industries in my area. We should have a proper programme of planned public spending instead of cutting back an capital spending, which is desperately needed for schools, hospitals and roads. We need a proper programme of capital spending, which would greatly assist all industries, particularly those in my area.

I should also like to see a change in the Government's policy on derelict land clearance. At present it relates only to development areas, because it is tied to a certain level of unemployment. My hon. Friend the Member for Wood Green mentioned the pressures on space for factory expansion in inner city areas. In my constituency there are vast tracts of derelict land. It is impossible for the borough council from its own resources to provide 50 per cent. of the expenditure in order to reclaim that land for industrial purposes. Use of those vast tracts of land on a site adjacent to London and the docks and which, as time passes, will be the site of an important road network would greatly enhance employment opportunities throughout East London. We need a change in the policy for supporting local authorities as they attempt to make derelict land available for industrial purposes.

The Government deliberately missed another opportunity. They put an end to the river Thames ship repairers, withdrawing the urgently needed ship repairing facility from the Port of London Authority. They let the opportunity pass to deal with the PLA's finances and upgrade the docks in the East End and Tilbury. I want to see viable, thriving and competitive docks throughout the Port of London. Those docks can compete properly with the Continental ports only if they are subsidised to the same extent. Once we have thriving docks, we also have jobs in dock-related industries. Opportunity after opportunity has been squandered by this Government to improve job opportunities in London and the South-East. Worse than that, the effect of their economic policies will be to destroy London as a manufacturing city and speed the process of deindustrialising Britain. We want to see those policies reversed before it is too late.

4.58 am

We are indebted to my right hon. Friend the Member for Battersea, North (Mr. Jay) for his determination to be here at 2 am. He started the debate at a good pace. My hon. Friends the Members for Newham, North-East (Mr. Leighton), Tooting (Mr. Cox), Holborn and St. Pancras, South (Mr. Dobson), Hackney, South and Shoreditch (Mr. Brown), Wood Green (Mr. Race) and Thurrock (Dr. McDonald) have also usefully contributed to the debate. They have introduced their own individual brand of passion, anger and experience. As I took notes of the various points on which I wanted to comment, I found a common thread running through them. Top of the list—and it was no surprise—was housing, followed by transport and employment and unemployment. There is no doubt that the villain of the night is Sir Horace Cutler. The quicker he gets his cards—and that will be next May—the better.

I know that the Under-Secretary of State, in his courteous and careful way, will have paid close attention to all the points that were made, but at this early stage I ask him to consider particularly the points made by my hon. Friend the Member for Wood Green about the London fire brigade service. The Minister will recall that on a previous occasion when I had the temerity to make similar points I got short shrift from him. I was accused of being alarmist about the situation at that time. I share the same local experience and newspapers as my hon. Friend the Member for Wood Green. I confirm that the local newspapers have carried accounts of the comments that my hon. Friend said we made to him by the local firemen. I ask the Minister at an early stage to make inquiries into the matter and to let us know the results.

I pay tribute to the contributions by the hon. Members for Ravensbourne (Mr. Hunt), Streatham (Mr. Shelton) and Paddington (Mr. Wheeler). They were clearly from a different point of view, but they were serious, subdued and defensive. I was surprised. As the debate was billed as being about London and its problems, particularly with the Greater London Council in mind, I expected a defiant rather than a defensive note from the Government Benches. Frankly, they are resigned to the certainty that there will be a change in the control of the GLC next year.

Housing is certainly high on the list of London's problems. I recall listening to the Secretary of State for the Environment on a radio programme defensively saying to the interviewer that he could not be expcted to carry all the can. "After all", he said, "we have been in government for only 15 months." That is absolutely true. Not everything in the Government's court can be wholly held to be their responsibility. But the government of the GLC has had responsibility not for 15 months but for more than three years. The GLC was formed in 1964, and the Tories have had control for nine of its 16 years. Therefore, it is not as easy for the Tory GLC to slip away from its responsibility as for the Tory Government at Westminster.

Housing in London has to be seen against the background of two devastating commentaries on London and the nation which have come our way in the past few weeks. My hon. Friend the Member for Holborn and St. Pancras, South referred copiously and correctly to the evidence in the report of the Select Committee on Environmental Matters which came out in the past week. Apparently 500,000 fewer homes will be built by 1985 than were forecast in the 1977 Green Paper and a nationwide level of 30,000 fewer houses will be built in the public sector by 1983–84. A severe imbalance in cuts has been planned for housing. Of all the public expenditure reductions that have emerged from this Government in the last 15 months, 92 per cent. of the cuts are to be found in the construction and housing spheres. By 1984, only 4 per cent. of total public expenditure will be spent on housing, whereas in 1974 the figure was 10 per cent. That is the measure of the decline in the Government's housing priorities.

However, we do not have to rely simply on the national picture, because the GLC has produced its own housing strategy for 1981 to 1983. That document represents a gloomy prospect for Londoners, which is worse than for the country as a whole. That document was debated at County Hall in the past few weeks. It reveals, first, that there are three times as many unfit dwellings—253,000, or 10 per cent. of the stock—in London as there were thought to be last year. In all, 642,000 dwellings—25 per cent. of the total—need substantial work carried out on them. Secondly, the demand for reasonably priced rented accommodation will be greater than the supply until at least 1985. Thirdly, the long-term trend of improving housing conditions based on substantial public investment has been reversed. Fourthly, house building in London, in the public and the private sector, has been more than halved. There were 24,600 starts in 1975, and only 11,000 starts in 1979. The proposed changes in the Housing Bill will not remotely stimulate the private sector to replace the public sector investment.

Frankly, that strategy statement serves as a gloomy warning of what will happen, not only under the current GLC but also under the Government over the next few years. When the Secretary of State announced the HIP allocation for 1980–81 in February, it was for English authorities and it totalled £2,199 million. While that was a colossal figure, when analysed it revealed that it was 24 per cent. below what the local authorities were expecting to spend in 1979–80. It was 32 per cent. below what was allocated by the Government for 1979–80. It was 39·5 per cent. below Labour's allocation for 1979–80, and it was a colossal 52 per cent. below what the local authorities requested as essential for their spending for the years 1980–81.

As every hon. Member present knows, the money that was made available under the HIP allocation will largely be spent merely to fulfil the existing commitments. It certainly led to many authorities, including the GLC, stopping Council mortgages for those who wished to buy their houses.

The GLC's house building record is also interesting. In 1973, it built 4,363 houses. By 1976 the number had risen to 7,342. In 1978 it declined to 3,136. In 1979 it had gone down to 1,336, and now in 1980 the miserable estimate is that 400 houses will be built by the GLC.—[HON. MEMBERS: "Scandalous".] When the Tory GLC in its strategy document said:
"New building has a low priority",
what it really meant was that it had no priority at all. As my hon. Friends have rightly pointed out, the housing situation which London now faces is a scandal and a disgrace. It must be defended tonight by the Minister. I appreciate that he has a responsibility for the Government, but he is also entitled to speak on behalf of his political friends at County Hall.

The National House Building Council forecasts that new starts by private developers will be down from 140,000 to 100,000 in 1980. In fact, the new housing starts in the public and private sector this year will be the lowest not for the last 10 or 30 years but for the last 5Zr years. This is the indictment that not only I bring but also the National House Building Council and every Londoner who is desperate for a house bring to the Minister tonight. It is his responsibility to answer for it.

As my hon. Friend the Member for Hackney, South and Shoreditch pointed out, one of the sad things has been the decline in the strategic role envisaged for housing 10 to 15 years ago between the GLC and the boroughs. I will give an illustration from my own constituency of Edmonton. In 1966, the Labour borough council and the Labour GLC combined to buy the Klinger site, formerly a factory, which became vacant in Silver Street. The sum of £3 million was paid by the GLC so that eventually, when the site was developed, the housing would be used not merely to house GLC tenants but also tenants from the London borough of Enfield. Over the next 12 or 13 years, despite the change in council control, in GLC control and in central control, the position remained the same.

The 330 houses, when they were built, were intended to be there for renting to 330 families, wherever they came from. I was on that site on Friday and one of the ladies I met there in the old people's dwellings was from Hackney. The concept had been followed through. But in 1978, without any consultation, the GLC and the Tory Enfield council reneged on 15 years of planning. Despite the fact that those houses had been built for rent, it was decided to sell them.

That was a catastrophe. At my surgery I meet many of my constituents who have been waiting for years in tower blocks, and in my part of Edmonton their escape from the tower blocks built in the 1960s was into the flats and the maisonettes on the Klinger site. What has happened since? The GLC decided to sell, aided and abetted by the Tory Enfield council. The properties then went for sale—£30,000 for a three-bed-roomed flat. The GLC and the Enfield council could not do otherwise. They were hemmed in; it was a Catch 22 position. They were determined doctrinally to sell, but they were inhibited and they had to sell them, not at the market price but at not less than the price at which they were built.

In March it was decided to put the houses on the market. What happened then? At the recent meeting of the housing committee, after more than four months and intense effort to sell the houses, guess how many of the 270 flats—excluding 60 for old people—have been sold? Only six have been sold, despite the most intensive efforts. In the local newspaper last week, Miss Cook, the council director of housing, admitted,
"It would seem that without a massive financial investment in advertising nothing further can be achieved."
Six out of 263 having been sold, what is to happen to the 257 which are unsold and unoccupied? The Enfield Tories are more optimistic about what is to happen than their own director of housing. At that meeting John Lindsay, the chairman of the housing committee, said:
"We are not turning our back on this.… We have done our best. They have only been up for sale for a short time and the rest is up to the GLC."
Umpteen millions of pounds of taxpayers' money has been invested to buy the land and build the houses. There is now an intensive campaign to sell them. The net result is that there are 250 houses on the site waiting to be bought. If the price of the houses is £30,000 this year, it should be £33,000 after a year has passed. If £30,000 of public money were not tied up in an empty house, it would be invested. If those concerned are proper business men, they must ask for £33,000 next year. Never mind the Enfield families that are desperate for a flat, the policy of the GLC and Enfield Conservative council is to let them stand and wait in the queue.

The Government's attitude to housing was well summed up by an editorial that appeared in The Guardian on 30 July following the publication of the report of the Select Committee on the Environment. It stated:
"The charge against the Government is not that it has cut housing—which is the obvious victim in a financial squeeze—but that the cuts have been carried out in secret, seemingly without any rational approach and in too severe a manner.
Mr. Heseltine's rationality is suspect because his policy has such an ideological smack. Subsidies to council tenants are to be cut back to £600 million—possibly to £200 million—while the hidden subsidy which mortgage tax relief provides will hardly dip below the £1,500 million level.
The result of this package can only mean an increase in the number of homeless, a lengthening of house waiting lists, an increase in voluntary sharing with more young people delaying their marriages and an increase in house prices because of the housing shortage. It is a policy which if persisted in the Government will come to regret."
The writing is on the wall on the Government's housing policies.

I turn briefly to employment in London. I am grateful to my hon. Friends for their excellent speeches. They will appear in the record and all Londoners will be grateful to my hon. Friends for making them. They speak with experience on the South-East.

In the past London enjoyed relatively good employment. That no longer applies. In the past 200 years London has lost 500,000 jobs. The pace of decline in London is barely matched elsewhere. London industry has declined by one third in the past 20 years. Between 1974 and 1979 female unemployment increased fivefold. Male unemployment doubled.

I pay tribute to my hon. Friend the Member for Thurrock: she spoke of the opportunities that exist for using available land that can be turned to good use. In London there are 35 square miles of land that is classified as unused and available.

There are more than 1 million public sector workers in London. When the Government attack public expenditure they make a direct attack upon 1 million public sector employees. My hon. Friend has said that so many of our troubles can be laid firmly at the Government's door. Those troubles include high interest rates, inflation, falling demand, import penetration, and export failure. They are all the direct result of Government policy. How can the Government improve employment in London? As my hon. Friend the Member for Wood Green said, London's employment must be tackled on a co-ordinated basis. More than one Department has responsibility, and there should be a co-ordinated effort.

London needs a more clearly defined policy. My hon. Friend the Member for Tooting rightly pointed out that London needs a Minister. We need a policy, but neither the GLC nor the Government have given us one. There should be a partnership between private and public finance. Manpower planning should be more co-ordinated. In addition, training should be taken to a higher level.

Deindustrialisation is increasing. It should be reversed. We need something that we have not seen for 15 months, namely, a partnership of unparalleled intensity between Westminster and County Hall. However, I doubt whether we shall get that from the deadly duo of Heseltine and Cutler—the "H and C". I do not know who is hot and who is cold. That deadly duo will not improve London. When the GLC becomes Labour-controlled once again next May, we may see a semblance of improvement.

Several of my hon. Friends have mentioned the problem of transport. I pay tribute to the expertise of my hon. Friend the Member for Holborn and St. Pancras, South. He gave us a graphic description of the problems. My hon. Friend the Member for Hackney, South and Shore-ditch rightly pointed out that responsibility for such scandal and disgrace undoubtedly rests with the leader of the GLC. Because of his arrogance and determination to be in front, he nailed his flag to the mast. He nailed himself to a government and to a party of business men at County Hall when, in a peremptory manner, he dismissed the former chairman of London Transport, who had done a first-class job. We all recognised that he had a major problem. Three and a half years later the men that he put in are being taken out in the same arrogant, unfeeling, but now justifiable way.

London Transport was the pride of London for a long time. It is not so any more. A recent report considered all London Transport's operations, and concluded:
"In summary, we diagnose that the executive board is weak in the skills required to run a large business, and indeed to manage itself as board."
That is a savage indictment of the board, and of the man who appointed them, Mr. Horace Cutler.

What do we need? First, we should switch the present emphasis on roads, to public transport. Higher priority should be given to pedestrians in London. People are more important than motor cars. We should try to achieve an integrated policy for public transport. Negotiations should be opened with British Rail in order to integrate all commuter-related services. That must be done quickly. The staff of London Transport must be consulted. The staff's experience and innovative spirit must be harnessed to serve Londoners. There must be a radical review of the fares policy to attract back the millions of Londoners who have deserted the buses. Whether transport is free, or fares are fixed or low, there must be a positive, sustained attack on high fares immediately.

There has been a decline in the morale of staff in the GLC. It was never lower. The evidence can be seen in County Hall and by speaking to councillors and staff. In June further cuts of 1,735 in GLC staff levels were announced. That is to take place by 1981. That is on top of 4,000, or 16 per cent., who have been dismissed, made redundant or retired since the Tories took control in 1977. Many of the posts have gone because of changes in national Government policies.

My constituents have little faith that the policies of the Government or GLC will bring them relief. By democratic means we have a Tory Government and a Tory GLC. They are both disastrous. By democratic means at the GLC election in 1981, and at the subsequent general election, we shall rid London and the nation of those twin catastrophies. That day cannot come a moment too soon.

5.27 am

I join in the tribute to the right hon. Member for Battersea, North (Mr. Jay) for being fortunate to head the distinguished cast in the debate on the Consolidated Fund. I am glad that he stayed, at considerable inconvenience, to open the debate. I understand from conversations that I have had with him why he is not with us now.

The right hon. Gentleman raised the problem of the St. John's estate in his borough. The facts are simply that the Wandsworth council sought consent to dispose of the estate. I am satisfied that there is no reason for me to interfere with the council's plans to dispose of the three vacant blocks for on-sale after completion of improvement into owner-occupation. However, I am anxious to ensure that tenants in the remaining two blocks are fully aware of what is involved, both under the right-to-buy and the security of tenure provisions of the Housing Bill, if they move from their present homes. That is why Wandsworth has been told that consent to sell the tenanted blocks will not be forthcoming until I am satisfied on that point.

My hon Friend the Member for Ravens-bourne (Mr. Hunt) emphasised one of the most important points which came through in many speeches—the need for an increase in the amount of housing in London. He emphasised the vital importance of shorthold which we believe will make a substantial contribution to housing in London. I also noted what my hon. Friend said about enterprise zones. It is interesting that, in spite of what Opposition Members say, the demands from Labour boroughs in London for enterprise zones indicate that Opposition Members are not representative of their local authorities, which want enterprise zones. I am delighted that the Isle of Dogs featured in the first list and I shall pass on to my right hon. Friend the suggestions that my hon. Friend the Member for Ravensbourne made about other zones.

The hon. Member for Newham, North-East (Mr. Leighton) made an interesting speech which showed clearly that he has not understood the facts of life in the real world. That came through in many of the speeches by Labour Members, though not in that of the hon. Member for Edmonton (Mr. Graham). One of those facts is that we cannot spend more than we earn—and that has happened for far too long in this country.

When complaining about the shortage of money for housing purposes, the hon. Member made no reference to the facility that his local authority will be able to obtain to add to the allocation by the sale of its dwellings to tenants, many of whom in Newham wish to buy.

The hon. Member asked about the purpose of Trident and the need to spend more money on it. That will be the subject of another debate, but I say to those who share the hon. Member's views that, without Trident and restored defences, the citizens of London would not be free to enjoy debates such as the one that we have had. Labour Members laugh. It is easy to laugh in a democracy, but they should recognise that we retain democracy only by remaining strong.

My hon. Friend the Member for Streatham (Mr. Shelton) paid tribute to the GLC for the fantastic transformation that it has made to Covent Garden, which it has aided in such a far-sighted manner. I am delighted to join in that tribute.

However, my hon. Friend made a mistake when he referred to the Labour Party knocking shorthold and said that the Labour threat to give security of tenure of shortholders would make landlords less likely to let. I do not believe that any landlord believes that the Labour Party will form a Government in the foreseeable future. I do not be- lieve that there is any problem with shorthold.

The hon. Member for Tooting (Mr. Cox) produced rather late in the day, and on a matter which is not the day-to-day responsibility of the GLC, a common feature in London debates, namely, the expected attack on Sir Horace Cutler. Sir Horace is attacked time and again for a variety of reasons—he is a formidable opponent of the Labour Party, he is single minded in his commitment to let GLC tenants buy their homes, he and the Tory GLC have cut staff substantially without any compulsory redundancies, and he has held the rate in a remarkable fashion.

All that deserves praise and I am delighted to give it to Sir Horace. The citizens of London are fortunate to have such a man in control, rather than the spendthrifts of places such as Manchester who are getting themselves deeper into debt because they pay no heed to the needs of tenants or ratepayers.

My hon. Friend the Member for Paddington (Mr. Wheeler) made an important contribution, because he gave us some hard common sense on figures. In spite of attempts to denigrate them, the official figures are clear. My hon. Friend said that too many jobs in London remain unfilled. There is a substantial number of unfilled vacancies in London in spite of all that we hear about unemployment. I noted what my hon. Friend had to say about the Control of Pollution Act and I will see that his remarks are passed to my hon. Friends with special responsibility for that aspect of matters.

The hon. Member for Hackney, South and Shoreditch (Mr. Brown), an old opponent in these debates—he and I have managed to get more London debates than many people at one time thought possible—spoke with knowledge and depth of feeling about his constituency of which I have some knowledge in my capacity as chairman of the Hackney and Islington Partnership. I pay tribute to the hon. Gentleman for his work to increase the number of jobs in the area. He asked about sheltered housing. I have to say, that as he well knows, the London borough of Hackney has a substantial amount of vacant land. It is for the borough of Hackney, on its vacant land, to decide where it puts first priority for the provision of sheltered housing. That is not the responsibility of the central Government. Our responsibility is to allocate the total amount that the London borough of Hackney can spend. It is for the borough to decide how it allocates that amount between various kinds of new-build, maintenance, insulation grants, home loans and so on.

I cannot help the hon. Gentleman further. He will have to get an answer from Mare Street about why some of the vacant land is not being used for sheltered housing—

I was making the point that the London borough of Hackney had identified a site but that the Secretary of State refused its compulsory purchase.

The hon. Gentleman perhaps failed to hear, due to some strange noise from the Benches near to him, that I stated that the borough had some land within its own ownership and had no need to acquire further land. The borough already owns a lot of land that is undeveloped. When it has finished developing that land, I could understand the hon. Gentleman making the sort of complaint that he has raised.

The hon. Member for Wood Green (Mr. Race) tried to dispute the figures given by my hon. Friend the Member for Paddington. My hon. Friend was quoting from a written reply which indicated that, in the course of the month ending 12 June 1980, 41,992 vacancies were notified in the particular area. The hon. Gentleman said that those figures indicated a longer period.

The answer went on to say that at 6 June, a particular date, there were 36,522 vacancies at employment offices. That answer, like the earlier answer, indicates that only about one-third of all vacancies are notified. This indicates that there are about 100,000 vacancies in Greater London—a very different story from that heard from Opposition Members. The hon. Gentleman, I am sure, inadvertently, misquoted my hon. Friend the Member for Ravensbourne, who did not say that London could be saved only by national action. My hon. Friend said that London would benefit when the Government conquered inflation—a different thing from Government action which means cranking the printing press and turning out more notes that are not backed by production.

I welcome the hon. Member for Thurrock to our London debates. She made an interesting contribution. We are glad to welcome her, even as a non-Londoner. She spoke of "the gathering storm" with, I thought, a certain amount of relish. That might not be unfair.

It is no more disgusting than some of the things the hon. Lady was saying. If the storm that she forecasts is to come, I can only say that a substantial number of people, not only in the South-East but also in the North-East and the North-West, tell me "For God's sake, don't change your policies now." I assure the hon. Lady and the House that they need have no fear. We are embarked upon a course determined to remove inflation from our system. Until inflation is removed, everything else will suffer. I think that behind the hon. Lady's remarks lay an unwillingness to recognise that her Government lost the last election.

Those hon. Members who mentioned the fire at Alexandra Palace will appreciate that the London fire brigade is not within my departmental responsibilities. I will see that they get answers. However, I must remind them that the reorganisation of the London fire brigade had the approbation of the Home Office because it met its standards. Speaking as a layman—I am sure that the hon. Member for Edmonton is no more of an expert on this—I would say that it would be unusual if the bulk of the force were not committed to stopping a fire of this size. Whether the old manning was in existence or not, I still believe that the same proportion would have been committed to that size of fire.

I do not propose to comment on what has been said about the Select Committee, because its report has to be studied and will in due course receive a considered response from my right hon. Friend.

Unlike the last Government, we respond swiftly to Select Committee reports.

This debate has ranged far wider than just housing. I hope that I have done my best so far, in my usual helpful and non-controversial fashion, to answer some of the issues raised. I want to deal in more depth with housing in a moment, but I shall deal first with another subject which has been raised. I will ask my right hon. Friends to respond directly by correspondence to non-housing issues which have been raised.

On industry, the Government have decided to concentrate the limited resources available for regional assistance on those areas of the country with the worst problems of persistently high unemployment and long-term structural decline. Assisted areas are normally designated by reference to whole travel-to-work areas, since they represent self-contained labour markets for which the Department of Employment quotes unemployment rates. Within a travel-to-work area such as London, there are, of course, pockets of high unemployment, but the TTWA's overall unemployment rate of 4·8 per cent. is well below the national average and compares favourably with areas such as Merseyside and Tyneside, both of which have suffered from unemployment in double figures for a considerable time. In view of this, I do not believe that assisted area status could be thought appropriate for the London area.

Labour Members have painted an alarming picture of rapid deterioration in housing conditions in London and of Government inactivity in face of a growing problem. Both images are far from the facts. A man from Mars listening to this debate would have thought that London housing history began only in May 1979. Labour Members like to forget that, in the majority of the years since 1946—not 1964—the control of London's housing has been overwhelmingly under the control of Labour local authorities. It would be stretching the imagination too much to blame this Government for all the ills or for failing to remedy them forthwith.

London's housing has improved immensely in recent years, in terms of both availability and physical condition. The Government remain firmly committed to sustaining the momentum of that improvement.

Of course, given the overall economic background and the need—clearly recognised by the previous Government—to reduce the burden of public expenditure, public sector housing has had to take its share of the cuts; but we do not accept that the only way to deal with a problem is to throw public money at it.

Mention was made of the Greater London house condition survey. That shows that there is a significant problem of disrepair in basically sound properties in both the public sector and the private sector, and of unfitness, though often for technical reasons, in scattered houses in all parts of London and all sectors of housing stock. I hope that hon. Gentlemen will recognise that several recent Government initiatives are relevant here.

It is worth reminding hon. Members of the achievements of the recent past, under Governments of both parties. The number of dwellings in London lacking one or more basic amenities has been roughly halved in the past decade; so has the number of households living in overcrowded conditions. Now, for the first time, there are in London more dwellings than households, though of course, for a variety of reasons, that does not mean that there is no longer a problem; but the situation is not as black as it has been painted.

There are, indeed, still too many families living in unsatisfactory conditions, and, of course, expectations are constantly rising. But the nature of the problem is changing, and the blanket solutions of the past are no longer appropriate. The emphasis of public sector housing policy must now be on meeting special needs, such as those of the elderly and handicapped; on making the best use of the existing housing stock, and ensuring that fit houses do not fall into disrepair—

and on meeting reasonable aspirations such as those for mobility and for low-cost home ownership.

The repair and improvement grant provisions of the Housing Bill, in particular the wider availability of repair grants and the new opportunity for tenants to receive grant, will permit a more finely tuned approach to the problems of particular areas. The increase in owner-occupation through the sale of council flats and houses and other measures to encourage low-cost home ownership will give more people a direct stake in their housing and an incentive to improve it. The measures in the Bill designed to retain a healthy private rented sector will encourage private landlords to improve their property and keep it in repair.

As I have said, public expenditure must be controlled, and London has had to accept its share of the reductions. But it is quite wrong to say that the Government have discriminated against London, or against housing in London.

To the extent that housing took a more than proportionate share of the reductions, this is the continuation of a trend begun under the previous Government—that fact is incontrovertible—and is a consequence of the improvement in housing conditions I have described, and the need to spend resources more selectively. As for the regional allocations, we have been determined to make funds available where they are most needed, rather than simply giving money to the authorities which are keenest to spend it.

In fact. London got about the same size slice of the national cake this year as last year. Also, recognising as we do that local authorities are the best judges of local needs, we are giving them from next year freedom to spend half the money they receive from sales of land and houses, on top of their allocations, and much greater freedom to transfer resources from one service to another when in their judgment this is justified.

Let me give the House two figures—first, of underspend. In the year 1977 –78, £836 million was allocated to the Greater London area. Only £789 million was spent. In the year 1978 –79, £824 million was allocated; only £727 million was spent. Hardly, when based upon the requirements put forward by local authorities, can it then be said that they were able to justify their requirements. What they did was to ask for more than they could spend, and other parts had to suffer.

The Greater London Council and its particular problems were mentioned. I deeply regret that the council has had to suspend its home loans scheme. I know that that is a disappointment to a substantial number of would-be house buyers. It must have been a difficult decision for the GLC, in view of its outstanding commitment to promoting home ownership, but this is, alas, as the GLC recognises, an unfortunate consequence of the reductions in allocations enforced by the national economic conditions. I regret that at present I cannot consider special cases from any authority seeking more money. All that I can say is that I have well in mind the GLC's desire to restart its loan scheme as soon as it can.

Hon. Members have suggested that recent measures will increase the difficulties facing Londoners who want to move, either to be nearer a job or for other personal reasons. I suggest that the increase in owner-occupation and the maintenance of a healthy private rented sector will make life easier, not harder, for those who need to move and who sometimes face bureaucratic obstacles to mobility in the public sector and in particular the public rented sector.

Nor do I think, and nor do most people with practical experience, that it is as difficult for public sector tenants to move as is sometimes suggested. I am satisfied, though I should welcome any further evidence that the hon. Member for Hackney, South and Shoreditch can give me, that the inter-borough nomination scheme is handling an increasing number of moves. The GLC is continuing to play an important role in facilitating mobility in its own stock and—what must not be forgotten—through nomination rights to stock that it has transferred to the boroughs. We are keen to encourage mobility schemes and are taking powers in the Housing Bill, which we shall be discussing later today, to give those schemes financial assistance.

Of course, London has a continuing housing problem. There is still need for a large programme of public investment—and it remains enormous by international standards. We need to improve housing conditions and to provide access to decent housing for those who cannot buy it in the market. But public expenditure is not a universal panacea, and it is an unhealthy situation that in some parts of London housing is virtually obtainable only through the local authority as landlord.

We are committed to directing public money where it is most needed, but we are also committed to maximising tenure choice, giving individuals an incentive to repair and improve their homes. Our seven-point plan for low-cost home ownership and the other measures in the Housing Bill may be national incentives, but they are particularly relevant to London, with its continuing high pressure of demand and its ageing housing stock.

We were elected with a clear mandate—no one disputes this, least of all the right hon. Lady who sat for Hertford and Stevenage, Mrs. Shirley Williams—to reverse our predecessors' policy on council house sales, and we have done this. There is ample evidence that many council tenants in London want to buy their own homes. As for the charge that only the best houses will be sold, the evidence so far is limited, but it does not support that view, and, with the substantial discounts available, there will be a strong incentive for tenants to buy on council estates of all sorts. Certainly in my own constituency I have had numerous requests to buy flats in tower blocks, requests which my prejudiced council has rejected.

This debate has been of value, for a wide variety of reasons. Most of all, perhaps, it has been of value in showing the average Londoner the difference between the two parties. There is a wide difference. On the Government Benches there is the party that puts the interests of the nation and the tenant first. On the Opposition Benches is a party that puts blind political dogma first and flies in the face of economic reality.

I acquit the hon. Member for Edmonton, but most of his hon. Friends still believe that one can spend one's way out of any problem by printing more and more money, by having more and more staff, by having more and more public housing, and by having less and less ownership and less and less private renting. We reject that philosophy, as the British public rejected it when they had their chance at the last general election.

Ministerial Patronage

5.55 am

I apologise to the Minister of State for dragging him from his bed at six o'clock in the morning to reply to my debate on ministerial patronage. Witnessing the dawn appearing over the Thames is much less attractive than writers and artists sometimes portray it. The Minister, as he is a beneficiary of the political patronage of his right hon. Friend the Prime Minister as well as, no doubt, a dispenser of patronage, is uniquely qualified to respond to the debate and I eagerly await his reply.

I have the honour to represent one of the three Walsall constituencies. We do not often intrude into the national news, but when we do, unfortunately, it is seldom to our advantage. Recent events have certainly confirmed that assessment. The British press, which certainly knows a thing or two about nepotism and patronage, and the Conservative Party, which invented and subsequently perfected it, have expressed indignation at the remarks by a Walsall council chairman, and his thoughts on appointments. If the chairman had asked my advice, which he did not, I would certainly have cautioned him as to the likely response that his statement would receive. In some ways the admonitions of the press and the Conservative Party have been rather hypocritical.

Last Tuesday the Prime Minister, in response to a gentle question, said:
"I have consistently stood up for people on the basis of merit and merit alone."—[Official Report, 29 July 1980; Vol. 989, c. 1285.]
I asked the Prime Minister whether she could put her hand on heart and admit that she had never advanced or retarded a career on the basis of politics.

What I want to do in this short debate is to explore more carefully the Prime Minister's assessment that merit is the sole criterion in public appointments. In his book, written 18 years ago, on patronage in British government, Peter Richards identified four basic methods of choosing people to occupy positions within the public domain. He talked of chance, heredity, competition and patronage. Patronage is a widespread feature of our society. Certainly it is no monopoly of this Government. It goes back many centuries in our history. One of the great criticisms one can make of appointments made by patronage is that those who are appointed are rarely accountable, and the posts filled by patronage are often invidious in that the people chosen, even if they are the best people for the jobs, are usually chosen as a result of some secretive process. If the best people are being chosen by the best method I believe that the process should be much more open to public scrutiny.

The patronage of the monarch has, thankfully, receded over the centuries. Since the beginning of the twentieth century, with the huge growth in the machinery of public administration, there has developed a new form of patronage, that of the Prime Minister and the departmental Ministers. The late Maurice Edelman called it "the patronage explosion". With the development of quangos there are now more and more appointments that are being made by Ministers. At a count in 1978 it was said that there were 5,000 positions on over 1,000 bodies involving ministerial patronage. If we include part-time posts, that figure could be as high as 20,000.

In his evidence to the Treasury and Civil Service Committee Mr. Charkham, head of the Civil Service Department's public service appointments unit, confirmed that the figure was 20,000. That patronage is an incredible element in British government and an indication of the magnitude of the patronage available to a Prime Minister and individual Ministers.

The Prime Minister—not just the present one—is the fount, or trough, dependent on one's view, of patronage. I am not talking about ministerial patronage or parliamentary patronage. Prime Ministers for centuries have advanced their political cronies, and those who share their political ideologies. That is not the object of my criticism. But the present Prime Minister, despite the occasional rhetoric claiming to support merit, am not talking about ministerial patronage has extended it. The Prime Minister seems keen to extend patronage. By reintroducing political honours for party workers, and by not refusing to close the door permanently on the hereditary principle in the House of Lords she is taking a retrograde step.

I shall briefly examine some of the powers of the Prime Minister in the context of political appointments. Bearing in mind what the Prime Minister said at Question Time on the Walsall situation deploring political patronage I refer to an article in The Times of 17 June 1978 where the author, Peter Hennessy, writes:
"As part of the shadow cabinet's review of state intervention and patronage, Sir Anthony Royle Conservative MP for Richmond-upon-Thames, and a former junior minister … is drawing up a list of 'the good and the great'—individuals sympathetic to the Tory cause whom Mrs. Thatcher might appoint to royal commissions, committees of inquiry and the boards of nationalised industries on a Conservative return to power."
The list is kept in Conservative Central Office … where Sir Anthony has a small staff to assist in its completion. The Prime Minister, then Leader of the Opposition, began her search for suitable individuals in 1976. The article said that that was routine for Conservative parties when in opposition. That is a clear case of a list being kept of worthies sympathetic to the Conservative Party and ready to be placed in positions of influence upon the Conservatives coming into office. To argue, therefore, that merit is the sole criterion for appointments is somewhat dubious and to have a staff compiling the list is an indication and proof of how dubious that process is.

I ask the Minister whether he has seen that list and how many individuals on it have been transferred to the list in his Department. How many people on that list have subsequently secured office in the Government or attached to the Government? The Minister's own Department, the Civil Service, has long cherished the principle of appointment by merit and we tend to despise the American spoils system.

Once again returning to The Time—not an unimpeachable source but a highly reputable one—we discover that here is a development that should cause anxiety to the Minister and to many people in the House. The view is expressed that, perhaps, the spoils system is slowly being introduced into this country. The Times states that the Prime Minister
"… is taking a much more serious interest in appointments at permanent secretary and deputy secretary level."
The article says that there is no idea of a political witch hunt but that, nevertheless
'… a senior official with 'notoriously Keynesian' views stands scant chance of promotion into the two highest grades in any of the economic ministries."
That is a form of political patronage. It means placing people in political office, or not, because of their political views. If that were extended I would regard it as highly reprehensible.

The Prime Minister and Prime Ministers before her have had enormous powers of patronage in ecclesiastical affairs. I regard this form of patronage as the most repugnant that can be exercised by a politician. I agree that the worst excesses of the past have been removed, but the principle of politicians making religious appointments remains and is deeply repugnant.

In the Civil Service Yearbook is listed one Mr. Colin Peterson, secretary for ecclesiastical patronage. He has an assistant, a Brigadier G. C. Curtis OBE. The address of their office is No. 10 Downing Street. Many who have read Trollope's Barchester Towers will recall that as the Bishop of Barchester lay dying his son wanted to replace him and was desperately anxious for the Government to nominate him to the post. Unfortunately, the Government were dying, and it was a race as to who died first. The old man died, the Government died minutes later, and the poor son never secured his father's post.

That may have been fiction, but it is an indication of the depths to which political patronage has dropped. How many appointments are made by the Prime Minister? What part does the right hon. Lady play in that process? Is the role a burdensome one? It was certainly burdensome for Lord Melbourne who remarked
"Damn it, another bishop dead."
and for Lord Salisbury who said
"I declare they die to spite me."
I should like to see the Government getting completely out of the business of interfering in religious appointments. Dissatisfaction with the patronage exercised by the Prime Minister is longstanding in the Church of England. What moral right did Lloyd George have to make religious appointments? There could be a Prime Minister who was not Church of England and whose background hardly befitted him to interfere in ecclesiastical appointments.

My criticism, too, is more of the way in which interference is expressed than of the choices made. I feel that one day this whole business can blow up in somebody's face.

Few countries are as status and title conscious as the British, and the Prime Minister has ample opportunity to cater for such urges and aspirations.

I shall not dwell at length on the honours system. Society ought to honour those who perform meritorious service for the community, but the honours are often going to the wrong people. The system of automatic honours for certain categories of civil servants, military men and contributors to party funds or people who have served their political parties has, in my view, been discredited and should be reformed.

It may be a source of innocent merriment for some, but I should like there to be a whole revision of the honours system. The Prime Minister gets himself or her-self involved in areas which should remain sacrosanct to others. I see that the Prime Minister even has a hand in the appointment of regius professors of history at Oxford university. While Michael Howard is eminently qualified as an historian, I do not think that the Crown has any right to interfere in academic affairs.

We have heard so much in the past about the list of the "great and the good". Peter Hennessy, The Times Whitehall correspondent, has argued that as so many such people play such a prominent part in government we have in a way been ruled by the "great and the good" for decades. This is the list of worthies drawn up now by the public appointments unit of the Civil Service Department. Fortunately, it has tried to broaden the list, although I should like to see a breakdown of it in terms of age, sex, social class, ethnic background and region of origin.

I believe that Mr. Clarkham promised the Select Committee on the Treasury and Civil Service that they would publish some information. I should like to see whether the list is as I fear—much too middle aged or elderly, middle class, London oriented, virtually all white and too generalist in background. Samuel Johnson said of generalists:
"A man may be so much of everything he is nothing of anything".
The list should be published. In his "Anatomy of Britain Today"—1971—Anthony Sampson says that the list is:
"a secret tome which is kept listing everyone who has the right qualifications of worthiness, soundness and discretion".
The earlier reforms unfortunately came to nought. I want to see the unit's list widened to draw the maximum talent from all sections of the community into the public service. I want to get the names out of the secret filing cabinets at Old Admiralty building and into the public domain. What we want from these appointments is not conformity but originality and creativity. I do not believe that those who appear in "Who's Who" necessarily have a monopoly of such qualifications.

Bernard Donoghue, former head of the policy analysis unit attached to the Prime Minister, said that Ministers were usually given
"just three names for a job, two of whom were unsuitable, the other being the person the department wanted".
He argues that these appointments should be advertised, open and clearly made on merit. I hope that we shall see that in the not too distant future.

Ministerial patronage is enormous. With the growth of quangos it has become even larger. Some of the criticisms of the hon. Member for Carlton (Mr. Holland) attack quangos per se. However, they perform a useful and in most cases an essential function, although I should like to see more concentration on the role of Ministers in filling such positions. Patronage;s not only positive in making appointments. It is also possible to dismiss people. In recent months there have been numerous instances of Ministers exercising almost reverse patronage, such as sweeping out members of the National Enterprise Board. The Sunday Telegraph said:
"The Cabinets strong man, namely, Mar garet Thatcher, has long been intent on taming the National Enterprise Board and tamed it has been."
The NEB's views were not shared by the Secretary of State.

We have heard a great deal about the members of the Commission for Racial Equality who were booted out. Four of the five whose terms were not renewed were black. Many regard the incident as sordid and feel that the Government made major mistakes. It is clearly an indication of political patronage.

I shall not go into the details of appointments in the judicial sphere, but if ever there was a riddle wrapped in a mystery inside an enigma it is the appointment of justices of the peace. Is the bench truly representative? Is it too dominated by political parties? Is it still essentially middle class, middle aged, white and Conservative? There have been attempts to advertise. I should like to know how successful reforms have been? It is important to diversify the bench and amend the way that it operates.

It is Utopian to hope that this or any Prime Minister will sweep the power of patronage away, even slowly. By definition, it confers enormous power on a Prime Minister. Patronage is an emotive word. It is associated in the minds of the public with a variety of abuses, which are not of the essence of patronage but merely its probably consequences unless measures are taken to avoid its sad and evil effects.

As for remedies, we need to reduce the areas of patronage. We need to increase the electoral element. I believe that Britain has a skin-deep democracy based on a thin veneer of elected representatives here and in town halls. Compared with many other democratic countries, we have the lowest number of electable individuals per hundred thousand population. This should be remedied. Far too many jobs now filled by patronage, by ministerial whim, could be filled by election with the people appointed being accountable. We need to open up to public scrutiny the list of the great and the good and to broaden its membership, making it less elitist.

One suggestion has been made by the national executive committee of the Labour Party. Not every piece of paper emanating from that source is regarded universally as having a great deal of sense, but I think such papers contain more sense than is normally attributed to it. In one of its recent statements on reforming the appointments system, the NEC suggested advertising posts. In its report it said that some jobs are clearly more important than others, but when appointments to key positions are made, it would like the Minister's nominee to be
"required to appear before the appropriate Select Committee of the House of Commons. This Committee would have the opportunity to cross-examine the proposed appointee and could repeat its opinion on his suitability to the House of Commons and the public. The considered opinion of a Select Committee could not be lightly ignored by the Minister."
The late Maurice Edelman advocated something like this five years ago when he urged a public service commission to do the job of scrutinising, investigating and approving.

We are living in the patronage society. Senior politicians and those who have prospered within the system can see little reason to change it, but there are those who have been excluded from this system who are less than satisfied.

I believe that the last words should go to Professor Richards who, in his book "Patronage in Government", said:
"Unfettered patronage is a menace to democracy. Parliament should be working to ensure that those with powers of appointment do not have full licence to allocate jobs to their friends and supporters."
Those are strong but true words.

6.17 am

I thank the hon. Member for Walsall, South (Mr. George) for his kind personal remarks at the beginning of his speech. It is always a pleasure to hear the hon. Gentleman address the House, but it is perhaps less of a pleasure at 6 o'clock in the morning than at other times. Even so, the hon. Gentleman has made an interesting speech which I shall want to study, as will others.

I hope that the hon. Gentleman will not find it offensive if I say that the idea of the hon. Member for Walsall, South addressing the House on the abuses of patronage is a little surprising—some might say presumptuous—at the present time. I shall come back to that subject later in my remarks.

I am afraid that the hon. Gentleman will find a great deal of what I have to say unsatisfactory, because he has raised a host of matters which are outside not only my ministerial responsibilities but the responsibility of any Minister.

Fond as I am of the novels of Trollope, I cannot stand at this Dispatch Box tonight and answer for the defects of nineteenth century ecclesiastical patronage which the hon. Gentleman raised. In the novel described by the hon. Gentleman, clearly the wrong choice was made. I think that the old bishop's son would have been the better choice. Be that as it may, I can have no responsibility for either ecclesiastical patronage or patronage over a wide area. In so far as my right hon. Friend the Prime Minister has a general oversight of this area, I am sure that the hon. Gentleman will wish to take those matters up with her.

As to my own patronage, I can assure the hon. Gentleman that it is of the most minimal kind. The Government Hospitality Committee for the purchase of wine is perhaps the major one. There are also the Civil Service College Advisory Council, the Central Committee on Awards, the Civil Service Appeal Board and the Civil Service Medical Appeal Board. Therefore, my own personal patronage is somewhat limited. Nevertheless, I should like to deal with some of the points that the hon. Gentleman raised, in so far as they deal with my general responsibilities as a Minister in the Civil Service Department.

There is a lot in what the hon. Gentleman said about the amount of patronage. Surely, therefore, he must agree with what the Government have been trying to do in the past year—for example, to reduce the number of quangos. The hon. Gentleman made some remarks about the efforts of my hon. Friend the Member for Carlton (Mr. Holland), who did a public service in drawing to the attention of the House the large numbers of quangos that existed. That showed just how wide was the area of advisory and executive bodies to which Ministers made appointments. My hon. Friend has shown what a wide area existed. As the hon. Gentleman knows, my right hon. Friend announced earlier this year a wide-ranging review of all quangos and the abolition of a large number of quangos to which Ministers made appointments.

It is obviously right to have certain areas in which Ministers can make executive appointments or have advisory bodies to help them in the exercise of their duties, but I think that the matter had got completely out of hand. I believe that it was right to reduce the number of quangos. I am sure the hon. Gentleman will agree that that was an important point.

The hon. Gentleman asked about the list of public appointments. Perhaps I can make it clear that the responsibility for making appointments to public bodies rests with the Minister who is concerned with the power of appointment to the body in question. The responsibilities of my right hon. Friend the Prime Minister, as Minister for the Civil Service, are confined to the small number of cases in which she makes appointments in that capacity. Therefore, if the hon. Gentleman has any particular points about individual appointments, he should take them up with the Ministers responsible for the various public bodies, and he will know which Ministers are responsible for making appointments to those public bodies.

The hon. Gentleman spoke about the public appointments unit in the Civil Service Department. Of course I am responsible to this House and to my right hon. Friend for the operation of that unit within the Department. That unit does not make any appointments whatsoever. All that it does is to produce a list. Appointments are, and remain, the responsibility of the Minister in charge of the relevant Department. All that the unit does is to provide a central service which departmental Ministers are free to use or not as they choose. If they use the unit and invite it to put forward names, they are not bound to follow its advice. Even if they appoint someone suggested by the public appointments unit, the decision is theirs.

The view has always been taken that it would not be right to publish the actual list of the so-called great and good because it would cause disappointment to many people who think that they are on the list but are not. It would probably cause astonishment to some people to find that they were on the list without having the faintest idea that they were on it.

All that I can say to the hon. Gentleman is that if he wants to suggest names for inclusion on that list, I shall be delighted to ensure that they are carefully considered. Evidence has been given to the Treasury and Civil Service Committee about the list. It has been suggested by some people that it is drawn from too narrow a section of the public. The list is always capable of improvement and expansion, and I would welcome suggestions from the hon. Gentleman of suitable people to be put on the list. Indeed, I would welcome that from any hon. Member or from any member of the public. If they want to suggest the names of people who would be valuable in the public interest, I shall ensure that they are carefully considered. I would welcome new names. I seek new names.

I assure the hon. Gentleman that the unit takes no account whatever of political affiliation when adding names to the list. In most cases, it has not the faintest idea of the political affiliations of those concerned. But, however good the list may be, it will always be the responsibility of departmental Ministers to decide what use they make of the list and who should be appointed to the bodies for which they have responsibility.

I urge the hon. Member to give us some more names. He says that there are not enough young people or people from outside London and not enough people from the ethnic minorities. All that may be true, and we would welcome the names of good people who can serve the public interest in the future. I urge the hon. Gentleman and others to provide us with new names. They will be most carefully considered.

If I understand aright the main thrust of the hon. Member's interesting speech—to which it is difficult at this hour to give the full study that it deserves—he is making some defence of the practice in his own town, on the ground that it may be bad enough, but others are equally bad. I utterly refute that defence. I utterly deplore—as, I feel sure, would most hon. Members—the action reported to have been taken by the Walsall borough council to make jobs in the public service dependent upon the political leanings of individuals. I think that most hon. Members, even those who are in general sympathy with the national executive committee of the Labour Party, would agree that such action represents a gross abuse of power and is one which should be widely condemned.

The hon. Member will agree that our public services are built upon a tradition of strict political impartiality. That tradition is the great strength of those services. The first loyalty of those who work within the public services is to the elected representatives who direct them, irrespective of political persuasion. The permanent servants of the Government set service to the public above service to a party. I believe that to be a fundamental principle of British public life. Were it to be broken in central Government, that would be a disaster. It is also a considerable disaster when it is broken in local government.

The principles of public service have been built upon centuries of experience. They are the envy of most countries in the world. Under those principles, an elected representative can look to a body of experience in the public service on coming into power and know that those who are his officials, whether in local or central Government, will serve him impartially and energetically. That is fundamental to our democratic system. Any hint of political patronage in this area runs the risk of undermining those principles in a very dangerous way. The work of our public servants must stand or fall on its merits. The quality of their work, their dedication and their efforts must be the determinant of their success, whether that success is to get a job, keep a job or advance within a job. If political allegiance should gain ascendancy over allegiance to the elected Government in Westminster, or if political allegiance should gain ascendancy over allegiance to the impartial views of those working in local government, our public services would rapidly become degraded.

The hon. Member referred in his opening remarks to Trollope. Let me take him back to the time of Trollope and the terrible position that existed in the public services before the Northcote Trevelyan report in 1853, when patronage really was rife. I am sure that no one in the House wants to go back to a situation where the political views of those who serve us as officials, whether in local or central Government, should be the deter- mining factor of their promotion or their appointment.

I think that the House must say that, unless there has been a very great misreporting—and I do not think there has been—the actions of Walsall borough council are, frankly, a first step in that direction. They not only bring that council into disrepute but run the risk of bringing our public servants into disrepute. Gross political patronage of that sort does a disservice to the public, who have a right to the best and most impartial treatment from those who serve them.

The hon. Gentleman has raised a host of important issues about patronage. I shall want to read them and draw them to the attention of my colleagues when we have time to study them at a more reasonable hour of the day.

I passionately believe in both central and local government. We are fortunate to have inherited a system of impartiality. The fact that none of us knows in our Departments whether an individual civil servant is a supporter or opponent of the Government of the day in his private vote in the ballot box is of great public importance and of great strength to our country. The same should be true of local government.

I hope that the hon. Gentleman will return to Walsall and make the speech that he has delivered to the House to the borough council. I hope that he will tell it that it should adopt the same high standards that he is urging upon the House. If he does that, he will have done a service to those who have sent him to this place as their elected representative and he will stop the borough council from committing what I believe would be a grave error and something that if repeated would have disastrous effects on the system of local government. It would be a return to the worst elements of patronage of the nineteenth century.

I urge the hon. Gentleman not only to make speeches in this Chamber but to return to Walsall after 8 August and make a few speeches there. Let him tell the council to carry out the excellent practices that he is recommending to us. One day I shall go to Walsall and make a speech to him along the lines of the one that he made to me. When that is done, we shall get along even better than at present and those in Walsall and in the House of Commons—

Polaris Replacement

6.32 am

This may seem a strange hour to launch a debate on so major a subject as the replacement of Polaris by Trident. It is a reflection on the strange procedures of this place that this is the only opportunity that we have to debate such a major decision before the House rises for a recess of several months.

There would not have been a debate on this issue if my right hon. and hon. Friends on the Liberal Bench had not insisted through this procedure that there should be one. We are glad that the Secretary of State for Defence has made himself available for the debate and that he intends to take part in it. I know that the right hon. Gentleman has many pressing commitments, and we genuinely welcome his presence in the Chamber at this hour. We equally welcome the presence of the hon. Member for West Bromwich, East (Mr. Snape), who is having to compete with the presence of my right hon. Friend the Member for Roxburgh, Selkirk and Peebles (Mr. Steel) on the Opposition Front Bench.

We seem to be the only Opposition on this issue. I am sure that there would have been a debate much earlier if the Labour Party had wanted to discuss Trident. I suspect that we are in for another occasion when the Labour Front Bench is silent. The official Opposition do not want anything said on the matter. It suits both the Government and the Opposition to say as little as possible about Trident for as long as possible.

I make no claim to be an expert on the technicalities of the Trident missile. I shall not be entering into much detail on its specific qualities. However, I am entitled—it is an entitlement that spreads throughout the country—to give a view on the strategic assumption that underlies its purchase and the prospects of its use.

The major decision to continue a British independent nuclear deterrent by substantial expenditure on the purchase of the Trident missile has been taken without any parliamentary decision or debate and in advance of the report of the Select Committee on defence, which is considering what weapon we should have if we retain an independent deterrent. I gather that it was taken in the absence of any full Cabinet discussion on the issue. It is an extraordinary way to take so major and crucial a decision.

I refer to what I think is a misleading statement at the beginning of the otherwise useful document which the Defence Council has produced and the Government have published. That document, the "Future United Kingdom Strategic Nuclear Deterrent Force", begins:
"The basic policy case for Britain's continuing to contribute to NATO an independent strategic nuclear force was explained by the Secretary of State for Defence on 24 January 1980 to the House of Commons".
So far, the account is true. The statement continues:
"which after debate backed the Government's policy by 308 votes to 52."
At first, I wondered when a motion had been tabled on the purchase of Trident or on the maintenance of an independent nuclear deterrent. The debate on nuclear policy was the only debate to take place in the last 15 years. However, it took place on a motion that the House should adjourn. The dramatic verdict of 308 votes to 52 was not the result of a motion that had specified particular features of defence policy. The debate had been a wide-ranging one about nuclear weapons.

When he wound up the debate, the Under-Secretary of State for Defence for the Army said:
"The debate has concentrated on NATO's plans to modernise its theatre nuclear force—the NATO agreement of 12 December. It has also concentrated on the steps that must be taken to ensure the continuing effectiveness of Britain's nuclear deterrent … We shall be voting tonight in support of NATO and of Britain's nuclear deterrent."—[Official Report, 24 January 1980; Vol. 977, c. 781–82.]
The Under-Secretary simply expressed his assumption about the reason for the Division. Some hon. Members may have been voting about whether to go home. He made clear that the vote was on two issues—namely, the modernisation of NATO theatre nuclear forces and the separate issue of whether to continue with an independent deterrent. Other speeches in that debate make clear that some hon. Members were discussing the general point of whether the West should be equipped with nuclear weapons. Some of my hon. Friends felt, as I did, that to go into the other Lobby would be to challenge not only the independent deterrent but cruise missiles, the American deterrent deployed in the service of NATO, and the general deployment of nuclear weapons by the West.

Anybody who thought that the debate represented a specific endorsement of the decision to maintain an independent nuclear deterrent or to purchase Trident must have been seriously misled. I hope that the Secretary of State will not seek to rest his case on that. It was wrong to include the statement in the document as if it endorsed the Government's policy.

This debate is not about the Western deterrent or about the American deterrent that is deployed in the service of NATO. It is concerned with whether Britain should retain an independent nuclear deterrent by purchasing Trident. It is an extremely expensive undertaking, despite the relatively favourable terms that have been concluded with the United States of America about the purchase of the Trident components. It represents an addition to the number of nuclear arms in the world. We must examine carefully any addition to that stockpile. If arguments about the retention of the deterrent have some validity for us, they will also have some validity for other nations. Those nations may argue that they should be in possession of a similar capability. If we are to indulge in the expense and destabilising extension of nuclear power in the world, there must be an overriding reason.

The defence of the Western democracies against the undoubted and demonstrated expansionism of the USSR is based on NATO and the American commitment to it. Without that, our defence strategy would fail. I support that commitment to NATO, and so does the Liberal Party. If we wish to safeguard our freedom, we must co-operate with our allies and indicate clearly that the Soviet Union strikes against the Western democracies at its peril.

Why does Britain need to go it alone, with a capacity that is separate from that of the Western Alliance? Why do we need to launch a nuclear retaliation on the USSR? It would not be final for the USSR, because even with this weapon system the scale of retaliation would not destroy it. It certainly would not destroy the USSR's ability to strike at us. We cannot destroy its capacity to destroy us.

I agree with what the Secretary of State has often said—that deterrence is about the others side's perceptions and calculations; it is about what the Soviet Union calculates is in its interest. Some of its calculations will be more ruthless and callous than ours. That is why I say, horrifying though it is, that we do not have the capability to destroy the Soviet Union, even if we are in possession of Trident. The Soviet Union is capable of calculating that the damage that we can inflict upon it might be tolerable in certain circumstances. The calculations that the aggressor might make could be more callous than ours.

If we are to equip ourselves with the power to go it alone, within limited constraints, on what do we base that desire? The supposition must be that the United States would hold back from responding to a Soviet nuclear threat to Europe. In spite of the suicidal potential for America of involvement in any nuclear conflict, I believe that the American deterrent would have to be deployed against such a threat in America's direct interest. It is crucial to the Western defence system that America accepts that; and there is ample evidence that American leaders, present and potential, accept it.

If the Americans respond or show themselves ready to respond, our strategic deterrent is unnecessary. If we contemplate circumstances in which the Americans would not respond to a Soviet strategic nuclear threat to the European democracies, we must assume that our alliance with America has already reached crumbling point. Our alliance with the rest of Europe would already be threatened and our relations with Powers such as West Germany would be threatened with a totally new situation.

If America were not prepared to defend West Germany. West Germany would view our behaviour differently. It would have to look for new ways to survive. It might even have to look for accommodations with the Soviet bloc. I do not envisage that situation, but if I imagine it for the purposes of understanding why we should have a nuclear deterrent of our own I can suppose only that the Western Alliance would have reached crumbling point before we could contemplate using such a deterrent.

If that were the situation, the United States would have probably already taken steps to prevent our using Trident, not least by drying up supplies of missiles and spares and by indirect means which would influence the locking in of Britain to the American deterrent. The more one thinks about that possibility, the more it seems that one is reduced to Domesday and Dr. Strangelove notions. Lord Carver expressed that more effectively in a debate in another place.

One can imagine ludicrous and frightening situations such as differences of interpretation of what the computers reveal about Soviet intentions. Britain might interpret the information as an indication of a Soviet nuclear strike. The Americans might say "We do not believe it. We think that it is a mistake and we are not prepared to deploy our nuclear deterrent." Could one imagine Britain saying "We think that it is genuine and we shall retaliate"?

If the British deterrent is not useful or necessary against the Soviet strategic nuclear threat—and I suggest that it is not—is it envisaged that Britain would use it against a conventional attack by the Soviet Union when the United States was not prepared to go all the way with us and when we would be forced to go it alone? It is incredible, not just to hon. Members but to the Russians.

I come back to the point that the Secretary of State has often made about the Russian perception of what we would do. I believe that the Russians know what pressures we should be under if we contemplated a strategic nuclear retaliation to a conventional attack mounted by them on us or any of our allies. They know what an impossible commitment it would be for Britain to launch a nuclear war in order to resist a conventional attack.

Therefore, I believe that the Russians are much more likely to strike by conventional means, preferably beginning in a NATO country in which there is some internal disorder or instability upon which they can latch and around which they can erect the sort of nonsensical justification that they advanced for their invasion of Afghanistan—saying that they had been invited in to bring about law and order, and promptly shooting the leader who was supposed to have invited them in. The whole Russian propaganda armoury looks ludicrous to us, but we must not forget that it is on internal disorder and instability in a particular country that the Russians are likely to launch not a nuclear but a conventional attack.

That could happen in a country such as West Germany in some future circumstances. It could happen in a non-NATO country the stability of which we were concerned about. It could happen in Iran or in a place such as Finland if she began to detach herself from the heavy degree of dependence on maintaining Soviet respect and connivance.

In any of those circumstances, the threat would be a conventional one. What use would Trident be then? It is no deterrent to an adventurist Power that is fully aware of the limitation that we would face in trying to deploy strategic nuclear weapons against a conventional attack.

Not only that, but by that time our possession of Trident could have reduced our capacity to resist that sort of conventional attack—the capacity of our Army, Navy and Air Force to defend us, through NATO or directly. In equipment, numbers or both, there has to be a price paid for Trident. There is almost no analyst or commentator, even among those who are sympathetic to the idea of retaining a British nuclear deterrent, who does not doubt strongly the Government's contention that there will be no price to be paid in our equipment budget and in our conventional weaponry for the purchase of Trident.

Whether it is any of the candidates already suggested, such as the Jaguar aircraft or the Hunter submarines—which may be affected by the building of submarines for Trident—it is widely believed that the Trident project will represent a threat to the equipment of our forces.

Something approaching £1 billion a year, at present prices, in the mid-1980s will have to come from somewhere. On the Government's own admission, it represents at least 8 per cent. of the defence equipment budget. Either our conventional forces will be weakened or, after several years of increasing defence spending by 3 per cent. a year according to the NATO agreement—something which Liberals sought to secure from the previous Government—we shall add another 5 per cent. a year in the peak years of Trident, at the expense of health, welfare, education and aid budgets.

That money has to come from somewhere. If it comes out of the defence budget, it must be at the expense of conventional forces, and if the equipping of those forces is not affected the money is bound to come out of other desirable and, in some cases, priority expenditure. For that price, we shall be vulnerable to an enemy which knows the restraints on our pressing the button and which will take care to ensure that its incursions are within the limits that make it impossible for us to retaliate in that way.

Since it is impossible to construct a scenario for our use of the weapons, one is forced to conclude that they exist for the purposes of political and national prestige. Is it to persuade the Americans to take us seriously that we have to equip ourselves with the weapon? Clearly, it is no more a threat to the Americans than it is to the Russians for us to have in our possession a weapon for which we are dependent on the Americans and on the use of which there are such overriding constraints.

A more accurate explanation, I believe, is that the Secretary of State and the Government are following in the steps of the late Aneurin Bevan, who, on behalf of the Labour leadership, spoke of his fear of going naked into the conference chamber. That was his defence of the British independent nuclear deterrent. The classic defence of the independent nuclear deterrent is that it gives us a standing and enables us to be taken more seriously.

We are no longer, in economic terms, a great Power. We began to travel the road away from that position even when Nye Bevan made his comment. We are much further away now. We cannot afford to buy seats at summits at the sort of cost that is involved, especially when the price of so doing may be an undermining of the defence that we shall most need—the ability to resist, and to help NATO to resist, the incursions that the Soviet Union knows that it can make underneath the useless umbrella that I believe Trident will prove to be for Britain's defence.

6.50 am

I am grateful to the hon. Member for Berwick-upon-Tweed (Mr. Beith) for initiating the debate. I wish to make only a brief intervention. I do so because, as I have expressed on previous occasions, I am profoundly disturbed by the Government's decision to replace Polaris with Trident. An increasing number of people are frightened at the way the militarists rely more on nuclear weapons as a deterrent. As the hon. Gentleman has remarked, the Trident system is merely a prestige symbol for this Government and this country.

The fiction of the independent nuclear deterrent is manifestly absurd. There is no reasonable circumstances in which the United Kingdom would launch a nuclear war on its own, separate and apart from the United States and separate and apart from NATO. If a war comes, it is likely to be brought about because of the appalling stockpile of nuclear weapons that exists in the world. That would have dreadful results for all.

The possession of Trident deters no country from beginning, or being involved n, a conventional war. It is an expensive embellishment of the defence of the United Kingdom. The colossal sums spent on Trident could, with everlasting advantage, be used for the great social problems that exist in this country. They could be used with great advantage to stop the de-industrialisation of our nation. They could certainly be used, with the gratitude of future generations, to end the death from starvation of thousands upon thousands of babies and children throughout the world. Future generations will look back and wonder how this country could embark on the replacement of Polaris with Trident.

I hope that more hon. Members and more people outside the House will consider the dramatic changes that could be wrought with the millions of pounds that will be spent on the replacement of Polaris. It is a terrible blunder by the Government. An example could be set to all the nuclear Powers if the Government abandoned this dangerous independent nuclear deterrent. Other countries that wish to belong to the nuclear club would be encouraged to say to themselves that if Britain abandoned Trident they should follow that lead, spend money on peaceful purposes and abandon the evil of the nuclear deterrent.

Although that is all I say at this early hour, I feel very strongly about this subject. I hope that the nation will be aroused to the need to abandon Trident as a replacement for Polaris.

6.55 am

We boast of parliamentary democracy, but when political parties find the going difficult they do not exactly excel in the art. The previous Administration cannot have been right to embark on a £1 billion modernisation programme for Polaris, code-named Chevaline, without so much as a nod in the direction of the Palace of Westminster. I give the Secretary of State credit for the fact that he told us all about it in the debate earlier this year.

I think that there is an argument that it goes back even further than that, to the previous Labour Administration.

Now, the decision has been taken about Trident, at a cost of £5 billion and probably more, with no debate or vote upon the various options. They came afterwards, in an admittedly well-argued document—Cmnd. 1823—but the deal had already been agreed in an exchange of letters between the Prime Minister and the President of the United States.

The Liberal Party has consistenly opposed the concept of the independent nuclear deterrent, and I support that stance, but in a major decision of this sort should not the comparisons between the various systems and their costs at least have been thrown open to debate in this place? I also believe that opposition to the independent nuclear deterrent is now more widely shared than ever before, and at fairly high military levels. That is another reason why we should have debated it separately and voted upon it.

As I have tried to make clear in previous defence debates, I fully support the NATO decision to replace its outdated theatre nuclear weapons—a decision, I accept, largely forced upon the Western European countries, the United States and Canada by the ever-increasing numbers of SS20s deployed by the USSR and the Warsaw Pact countries.

I also accept the need for the United Kingdom to share to the full in the implementation of that decision, which must mean the stationing of cruise missiles on our soil. Unless the members of NATO continue to work in harmony and are clearly seen to do so, the whole strategy of deterrence upon which the Alliance is based will be lost. We would then be heading for a major confrontation. The Secretary of State is absolutely right on that, and I have stood firm on it, despite a fair amount of correspondence from various parts of the country.

On the role of the independent nuclear deterrent, I have read no more convincing debunking of the concept—my hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith) made a good case—than that made by Lord Carver in the debate on 18 December in the House of Lords. That is an argument with which the Secretary of State must be only too familiar but which has never been adequately answered. Although I may not quote from that speech, I draw attention to column 1268 of the debate. It is fair to say that there have been much better, and better argued, debates in the other place than we have had here. A great deal of excellent information has been given and the case has been more deeply argued.

The Secretary of State's decision, announced on 15 July, has, to say the very least, received a pretty mixed press. Whilst I and my colleagues can readily understand the Labour Party's wish to put off its debate on this subject until the autumn, we feel that it should be condemned for not having the courage to challenge the decision before the Summer Recess.

Does the hon. Gentleman concede that the argument that he has so far put forward was expressed from the Labour Benches on at least three occasions earlier this year, in the three defence debates? At that time the Liberal Party was conspicuous by its absence. The fact that there are now five Liberal Members present, at the unprecedented time for them of 7 am, indicates that they are more concerned with promoting themselves than the objective which supposedly is the motive for this debate.

I do not remember a major defence debate in which I have not taken part. That was a complete misstatement on the hon. Gentleman's part. I think that I have spoken in every major defence debate in this House since I took on the job.

Many criticisms have been made and ought to be answered. The answers should not be put off. On 20 July, the leading article in The Sunday Times said:
"In true military fashion Mr. Pym has first decided that we are to have Trident and new tells us why we are to like it. As an exercise in open government—which is how the White Paper facetiously described itself—this is a mockery."
I accept that the leading article goes on later generally to support the argument, but it also says:
"If we had no deterrent we would not now be thinking of laying out huge sums on getting one."
The article also suggests that there should have been a far wider-ranging debate on it before the announcement was made.

At about the same time, there appeared in The Guardian an article by Peter Jenkins. The heading states:
"One presumes that few Ministers believe the cant they spout about Polaris being an essential part of the NATO deterrent."
The last part of the article states:
"Britain is not economically fit enough to attempt the strategic over-stretch upon which Conservative governments usually insist. As a national deterrent of last-resort the Polaris would have done for a while yet. The Trident is too elaborate and expensive for that purpose; what other purpose it is intended to serve is not clear. Its relevance to NATO is limited and may impair Britain's contribution to the redress of the military balance in Europe where it really matters.
Meanwhile, the government seems to have no policy for arms control and no serious interest in East-West relations. The replacement of the deterrent is supposed to ensure a continuing place at some top table but Mrs. Thatcher is absent from the top table at which Schmidt and Giscard sup. They are more and more the architects of Europe's future. For these reasons it would have been preferable to delay the procurement of the Trident and think deeper."
Perhaps the best leader of all appeared in The Scotsman. It posed some very poignant questions. It said:
"You do not need to be a unilateral disarmer to have doubts about Trident. Given acceptance of the need for deterrence, the Defence Minister has as yet failed to make clear how Trident is anything more than marginally more effective as a deterrent than a Cruise missile system, which would cost only half as much as Trident-I".
That of course was the evidence that was given to the Defence Committee of this House.
"If Britain was experiencing booming prosperity it would be easy to understand expenditure on Trident as a contribution to the Western Alliance's necessary military programme to counter the frightening growth in size and sophistication of the Soviet arsenal. But these are not the facts in 1980 Britain. A large percentage of the population is worried sick by burgeoning unemployment. When the winter is well set we will begin to read reports of intense hardship suffered by people dependent on social security payments, which have been cut in real terms by this Government. Even people in employment are having difficulties meeting basic commitments to their families because of the high rate of inflation. Meanwhile, they see cuts being made in what hitherto were considered to be essential educational and health services.
MPs also need to ask on our behalf how independent our Trident system will be. Will there be restrictive clauses in the purchasing agreement for the delivery system from the Americans? If so, will the system be truly independent? If not, what's the point of it? Also, how will expenditure on Trident affect our ability to make vital contributions to NATO's conventional forces? Mr. Pym made a smart move in announcing the launch of the £1·3 billion Challenger tank and MCV-80 armoured personnel carrier programme before he revealed the Trident decision. This suggests there is no weakening of Government resolve in the conventional field—but what about its financial ability as the Trident costs mount? And what flexibility does Trident allow the Government should the Soviets seriously enter nuclear arms limitation talks? Is it not the case that it permits less flexibility than a Cruise missile system? Finally—and not merely provocatively—Mr. David Steel's query as to whether Mrs. Thatcher's Government is suffering from delusions of grandeur needs to be echoed. Mr. William Rodgers, Labour's defence spokesman, who has fought bravely the appallingly—and sometimes sinisterly—naive unilateralists in his party, probably summed up the feeling of many people both inside and outside Labour's ranks when he said in Parliament yesterday: 'We believe the case for buying Trident has not been made out and we simply cannot approve it.' Will Mr. Pym now start arguing his case?"
In an important article published in The Observer on 27 July, Robert Stephens, the foreign editor, arguing against Trident and against his own newspaper's leading article, concluded:
"Rejecting the British deterrent does not necessarily mean accepting total unilateral nuclear disarmament, that is, the renunciation of all reliance on, or use of, nuclear weapons, whether British or other. It can mean continuing to rely on NATO and the American deterrent, while working to diminish the nuclear war risk through arms control measures, such as the Soviet-American SALT treaties, the nuclear non-proliferation treaty, the nuclear test ban, the reduction of forces in Europe and the creation of nuclear-free zones.
The whole-hog unilateralist case is strongest when based on moral grounds—the refusal to take part in a nuclear war that could destroy mankind, if deterrence fails. Its main weakness is its failure to recognise that the only sure way that nuclear war can be prevented is not through simply renouncing the bomb but by preventing war itself. The nuclear genie can now be put back securely into its bottle only if it is corked with an effective international security system to prevent war."
I share those views. The questions that I have put, from the quotations that I have given, should be answered—and should be answered this morning.

7.7 am

I am glad that the Liberal Party has chosen to raise this matter, but I look forward to debating it at a more sensible time of the day and in greater depth when we return from the holidays. We have already had what might be described as a preliminary debate, in which my right hon. Friend the Secretary of State for Defence made a powerful speech. He made a case for the British deterrent that neither the Liberal Party nor the Labour Party has countered.

Whether we have a new Lib-Lab pact today, as the Liberal Leader is sitting shoulder-to-shoulder with the Labour spokesman, the hon. Member for West Bromwich, East (Mr. Snape) on the Opposition Front Bench, I know not—

I think that what the hon. and learned Gentleman describes as a new Lib-Lab pact is due more to the fact that Liberal Party Members are unused to being up at nearly 7.10 am, though members of the Labour Party are quite used to it. Because the Liberals are so unused to it, their leader has to draw attention to himself by sitting next to me.

I shall leave the hon. Gentleman and the right hon. Member for Roxburgh, Selkirk and Peebles (Mr. Steel) to their squabbles on the Opposition Front Bench. We on the Government Benches can step back from those squabbles and contemplate them with a certain degree of interest and irony at this time of the morning.

The point that was missed by the hon. Member for Berwick-upon-Tweed (Mr. Beith), who initiated the debate at this unearthly hour, and by the hon. Member for Isle of Wight (Mr. Ross), was the cardinal issue whether there should be a further decision-maker in the Western world on the possible use of nuclear weapons. That is something that the Liberal Party does not seem to be able to face. It is spelt out in the Government's document at paragraph 5, in which it is said:
"An adversary assessing the consequences of possible aggression in Europe would have to regard a Western defence containing these powerful independent elements"—
which is what we are debating, a separate nuclear force controlled by us—
"as a harder one to predict, and a more dangerous one to assail, than one in which nuclear retaliatory power rested in United States' hands alone."
I am sure that hon. Gentlemen will turn their minds to that. It is a powerful argument and one on which the House deserves to have the views of the Liberal Party. It seems absolutely logical that if there is more than one decision-maker with respect to nuclear weapons, peace is more secure.

Would not my hon. and learned Friend agree that the British independent nuclear deterrent would have a great deal more credibility if the civil population in this country had a far greater degree of protection than currently exists?

I take my hon. Friend's point. I know of his considerable expertise on the issue of civil defence, and that is clearly what is in his mind. We are expecting, within the next few days before the House rises, a statement about civil defence which may cause there to be what might be described as a "strengthening of our posture". Undoubtedly, many lives could be saved—if there were to be a nuclear holocaust—by low-cost precautions. They would also show our determination. If there are to be further steps taken, what must be emphasised is that we are in the deterrence business. That is what we must concentrate on.

I fail to see how any case has been made out by the Liberal spokesmen who have dealt with this theme. I do not see how there can be other than increased security for our country if we have an independent nuclear deterrent, updated as it must be, because Polaris has been going for a long time. While it is still credible and viable and so on, the vessels in which the system is transported are getting rather old now and the time has come to make a decision whether we are to retain the mechanism which has maintained peace in the world, and for us in particular—

The hon. and learned Member has posed the question whether an additional decision centre within the Western deterrent is a desirable thing. In my speech, I sought to argue the case that Britain did not effectively have an independent decision centre and that there were too many constraints on our using such weapons. The hon. and learned Gentleman seems to be suggesting that the more decision centres there are, the better for purposes of world peace. Does he believe that if more Western Powers had the ability to launch a nuclear war the world would become a more stable place as a consequence?