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Commons Chamber

Volume 21: debated on Monday 5 April 1982

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House Of Commons

Monday 5 April 1982

The House met at half-past Two o'clock

The House being met, MR. BERNARD WEATHERILL, THE CHAIRMAN OF WAYS AND MEANS, at the request of MR. SPEAKER, proceeded to the Table and, after Prayers, took the Chair as DEPUTY SPEAKER, pursuant to the Standing Order.

Oral Answers To Questions


Standing Charges


asked the Secretary of State for Energy if he is ready to announce the results of his discussions on standing charges; and if he will make a statement


asked the Secretary of State for Energy whether, in his review of standing charges for gas and electricity supplies, he has made any assessment of the fairness of the criteria used to determine such charges

My hon. Friend the Member for Braintree (Mr. Newton) and I are still considering the matter, and the point raised by my hon. Friend the Member for Chipping Barnet (Mr. Chapman) is one of the matters that we have very much in mind. I am having discussions with gas and electricity supply industries, whose sole responsibility it is to fix the level of standing charges. A statement will be made as soon as possible.

I appreciate that my hon. Friend has an indirect role in this matter, but does he accept that standing charges are widely, misunderstood, especially by the elderly, who find it difficult to cope with them? Is there some means which be could press by which standing charges can be consolidated into overall charges so that consumers pay only for what they use? Will he consider removing standing charges when the cost of the energy consumed is less than the standing charge?

I am grateful for my hon. Friend's recognition that the extent of charges is a matter for the industries concerned. We are once again examining the rationale behind standing charges. When an examination was carried out in 1976, it was concluded that standing charges were appropriate. The tariff basis for the gas industry was approved as recently as 1979 in the Price Commission investigation.

I am grateful to my hon. Friend for what I consider to be a most helpful and encouraging reply. While I appreciate that the cost of the standing charge is based on the cost of bringing the energy from its source of supply to the consumer, including the provision and maintenance of supply pipes, will he nevertheless keep in mind, when decisions are being taken, that it seems unfair that the consumer must pay the standing charge when it becomes a substantial proportion of the total bill? Does he agree that in equity there should be some arrangement whereby standing charges are either reduced or transferred to the cost per unit of the energy concerned?

I am grateful to my hon. Friend for raising that point. I am well aware of the type of case to which he refers. If the object of the exercise is, as it was for our predecessors, to find a way of helping poor consumers, the problem is that poor consumers are not necessarily the smaller ones. Any removal of standing charges for one group could only lead to material increases in unit charges for others. That could make the position of some poor consumers worse than it is now.

Is the hon. Gentleman aware that standing charges are not only a substantial part of energy bills, as the hon. Member of Ealing, North (Mr. Greenway) said, but that in many cases they are higher than the cost of consumption? Is he further aware that that is what old-age pensioners and people living on their own resent? Will he take the point made by his hon. Friend the Member for Ealing, North, that some way should be found to sink that cost in the overall cost of energy?

I had hoped that I had made the point clear. We are examining the matter. I am anxious not to raise hopes. It is only fair to say that when an exhaustive investigation was undertaken some years ago, it foundered on the difficulty of finding any form of tariff structure that would help all poor consumers. Not all poor consumers are necessarily small ones. That difficulty stands in the way of assisting people by merely removing standing charges, as standing charges are worth some £500 million in revenue to each supply industry and that money would have to be found in some other way.

Will my right hon. Friend bear two matters in mind? First, will he bear in mind that in the 1976 inquiry the percentage of the bill represented by the standing charge was frequently nothing like so great as it is now and that standing charges have risen considerably in the past six years? Secondly, although one may not be able to help all poor people, will he bear in mind that those with small gas or electricity bills who are trying to keep their costs down are usually the poorest section of society and that it would be better to help some people than to help no one?

I certainly take my hon. Friend's point about the level of standing charges, but both industries have been seeking to make standing charges more truly reflect the underlying costs that they are supposed to represent. My hon. Friend will also be aware that in the past there was a low standing charge with a higher price for the first 52 therms. That has now gone and has been replaced by a higher standing charge.

Is the Minister aware that, in the past two years, the charges have risen by between 300 per cent. and 400 per cent. and that the increase is greatly resented, particularly by pensioners and others on low income? Is he aware that pensioners lobbied certain hon. Members only last week—and pensioners are certainly low paid—asking for a withdrawal of the charges?

I know that the hon. Member wishes to be fair. He will therefore bear in mind the point that I made in answer to my hon. Friend the Member for Honiton (Sir Peter Emery). It is a distortion to refer to increases of 300 per cent. in gas standing charges, because the higher charge for the first 52 therms has now been abolished. Had that system been in place in 1979, the gas standing charge in money terms would have been £6·37 per quarter.

I had a most constructive meeting at the Department with the pensioners' group that organised the petition. I assure the hon. Gentleman that all these matters are being looked into with great care. As I said last time, however, I do not wish the Opposition to go away with the idea that it will be much easier for us to resolve the matter than it was when they were in Government.

Will my right hoh. Friend look again at the percentage increase in standing charges for gas? Does he agree that British Gas is now using this as a disguised form of tariff, which is bearing most unfairly on some small consumers who are genuinelly trying to economise?

I have met the deputy chairmen of both supply industries to discuss these matters. We are concerned to ensure that the charges truly reflect the proper costs to the industry and are in no way a cover for inefficiency, but it appears that the accounting basis for the standing charges is accurate and truly reflects the costs that it is supposed to represent.

As has been made clear by the exchanges today, there is now a widespread demand in all parts of the House for a genuine and radical review, and not just the promise of a half review. Can the Minister tell us the time scale of the review that he and his colleagues are undertaking and when we may expect the result?

The last review, which was very thorough, took the best part of a year. Clearly we wish to take a great deal less time than that. Nevertheless, this involves looking again at the considerable amount of work that was done in 1976. It also involves consultation with the industries and with my hon. Friend at the Department of Health and Social Security. I can only tell the House that these matters are being considered properly and seriously. As soon as we are in a position to make an announcement, one will be made.

Coal Industry (Productivity)


asked the Secretary of State for Energy when he next proposes to meet the chairman of the National Coal Board to discuss productivity in the coal industry.

My right hon. Friend meets the chairman of the board frequently to discuss this and other aspects of the board's business.

When the Minister next meets the chairman, will he congratulate the miners on the increase in productivity, not least on the 6 per cent. increase at the coalface in the past year? In view of the stocks that have arisen as a result of the increase in productivity, will he impress upon the chairman of the NCB that for that reason there should not be pit closures?

Secondly, will the Government do more than they are doing at present to increase the use of coal in industry, as their present efforts can only be described as feeble?

The hon. Gentleman is right to congratulate the miners on the overall increase in productivity of 3·4 per cent. output per man shift. It would be wrong, however, to encourage people to believe the simplistic notion that that is the only reason for the increase in stocks, which relates to the long-term supply and demand position. I am sure that, on reflection, the hon. Gentleman will wish to congratulate the Government on the improvement in the coal boiler conversion scheme announced in the Budget. I am sure that he appreciates the Government's attempts to produce real increases in the use of coal.

Will my hon. Friend confirm that if production is running well ahead of demand, there will have to be cutbacks in uneconomic pits?

My hon. Friend draws attention to the undeniable problem facing the industry and all who support its long-term needs—namely, over-supply relative to current demand. It is no use ignoring that aspect. All who wish the industry well in future must recognise that basic difficulty.

While congratulating the miners on the increase in productivity, may I ask whether the Minister accepts that the best way to increase productivity in the longer term is to sink new, modern pits which are up-to-date in every sense? In that respect, will he take what steps he can to speed up development in areas such as Cannock Chase, where there is the possibility of further coal development?

The hon. Gentleman is assiduous in pursuing his constituency interest in this matter, but I am sure that he and all who are interested in the future of coal will understand the dilemma that we face. We have to develop new economic capacity while recognising the problems of closing uneconomic capacity.

Does my hon. Friend accept the "Plan for Coal" production targets of 135 million tonnes and 170 million tonnes by the end of the century in the light of what has been said about the declining market and increasing subsidies from the State?

We and the industry are concerned to provide coal at competitive prices to meet the needs of the market place. I imagine that that will allow the industry to sell more coal to that market, but it must be competitive and offer security of supply.

How can the Government have any credible conversations or discussions with the NCB about productivity when their own policies are responsible for delaying replacement coal production capacity? Does the Minister recognise that that is the true meaning of the situation in the Vale of Belvoir and the comments of my hon. Friend the Member for Cannock (Mr. Roberts)? Will the hon. Gentleman give a categorical assurance that in the Vale of Belvoir, for example, the pits will be sunk in the lifetime of this Government?

Quite the reverse of what the hon. Gentleman says has actually occurred. The Government have made it clear that the North-East Leicestershire prospect will be developed in an environmentally acceptable manner. That combination of policies will suit not just the coal industry but the wider interests that the Government have to bear in mind

Gas Prices


asked the Secretary of State for Energy how domestic gas prices currently compare with those in European Economic Community member States.


asked the Secretary of State for Energy how prices for domestic gas paid by consumers in France and Germany compare with prices in Great Britain.

Making adjustments for the change in exchange rates since the latest available information was given to my hon. Friend in answer to his similar question in February, prices in France and Germany are typically about 100 per cent. and 70 per cent. higher than in the United Kingdom.

Does my hon. Friend's reply mean that, when taking British pay and pension levels into account, the British domestic gas consumer is now paying a more realistic price, which his European counterparts have always had to pay, and that it was grossly irresponsible of the Labour Government to force British Gas to sell at a loss?

My hon. Friend is right in the sense that the price is more realistic, but it is only right to point out to people in the United Kingdom that the relative price change between domestic and industrial prices on the Continent still shows a far wider disparity than in Britain.

As there is a very large lobby outside the House, and quite a strong lobby within it, for the export of British gas to Europe and therefore the establishment of a European price for domestic gas, are not the increases that the hon. Gentleman mentioned what the British domestic consumer could expect if such a lobby were successful?

First, it would be better if the hon. Gentleman recognised that we are still not self-sufficient in gas. We import more than 23 per cent. of our gas from across the median line. He should also understand the nature of competition in producing new supplies. Competition always offers the consumer a better deal than monopoly pricing of supplies.

Cross-Channel Energy Links


asked the Secretary of State for Energy what progress has been made in developing cross-Channel energy links; and if he will make a statement.

The CEGB has signed agreements with Electricité de France, approved by both Governments, to install cables of 2,000 MW capacity, which will allow electricity to be transmitted in both directions. A hydrosearch survey of the route is presently being undertaken, and it is expected that the link will be fully operational by 1985.

Does not the Minister accept that this news will be widely welcomed in the coal industry, where this is regarded as a method of exporting coal-generated electricity? When this project is considered, will the Minister assure the House that the Government will not shut their eyes to possible further developments of this kind between ourselves and the Continent?

We would not want to shut our eyes to further developments, although this was the most promising. The hon. Gentleman is right to welcome it. It will be of benefit to both France and Britain, and it means that for about a quarter of the cost of building a 2,000 MW power station in Britain, we have the advantage of being able to tap in to the French electricity system at the peak as, indeed, France can also do with British electricity when its marginal rates are high.

Has my hon. Friend noticed the support coming from the Opposition for a gas pipeline between England and the Continent? Will he confirm that the Government will not stand in the way of any such pipeline?

As I think my hon. Friend knows, the problem in Britain at present is not that we have so much gas that we need to consider exporting it, but that we do not have enough to meet home demand. Our present concern is to liberate the gas market so that proper home demand, particularly from industry, can be met.

When does the Minister expect the United Kingdom to be self-sufficient in gas? Will he assure the House that, unless and until we are self-sufficient, there will be no probability or possibility of exporting gas to anywhere on the Continent?

It is the Government's wish—as the hon. Gentleman knows, having served on the Oil and Gas (Enterprise) Bill Committee—that the liberation of the market that will take place when that measure becomes law will lead to an increased incentive to bring the gas cut of the North Sea to satisfy British demands. I again reiterate that our concern is with unsatisfied British demand, and at this stage we are not contemplating exports.

Does my hon. Friend accept that, while at present we are not self-sufficient in gas, there is every possibility that we could acquire from other sectors of the North Sea—for example, the Norwegians—future gas supplies that would make a cross-Channel link extremely valuable for the re-export of gas?

I am grateful to my hon. Friend for raising that matter. The House should know that we have told the Norwegians that we are willing to consider projects for the transmission of Norwegian gas through Britain for onward sale to the Continent.

Coal Industry (Discussions)


asked the Secretary of State for Energy, if he will arrange a meeting with the new chairman of the National Coal Board and the new president of the National Union of Mineworkers to discuss the future of the coal industry.

While it would be premature to talk about the new chairman of the National Coal Board, I shall be meeting the new president of the National Union of Mineworkers later this month. Meanwhile, I am sure the whole House will join me in wishing Mr. Gormley well in his retirement, which starts today, and in paying tribute to his able and effective leadership of the NUM for the past 11 years. The coal industry and its prospects have undergone major changes while he has been president of the NUM, and I am sure the whole industry and, indeed, the whole House recognise the important role he has played.

I am sure that the House sends its good wishes to Joe Gormley and Derek Ezra. When will there be a Government statement about the appointment of the new chairman? Will the right hon. Gentleman consider calling the board and the union together to try to reach tripartite agreement for the future so that this successful, publicly owned industry can continue the level of production and productivity that it has enjoyed in the past, due to the investment of the Labour Government, which has been continued by this Government?

This Government have made available more substantial funds to the coal board for investment, and it is our intention that the coal industry, provided it plays its part, should be a success as, indeed, it can. An announcement about the new chairman of the NCB will be made in due course.

When my right hon. Friend meets the new president of the NUM, will he remind him of the sterling work done by Mr. Joe Gormley and point out that, if the new president looks after the interests of the mineworkers as well and stops playing politics, that will be to the benefit of both the mineworkers and the country?

I believe that the new president of the NUM has already received certain advice from his predecessor, upon which I do not think I could improve.

When the right hon. Gentleman meets the new president of the NUM, Mr. Arthur Scargill—as I have already said, he is a grand lad—will he bear in mind that he was president of the Yorkshire area for 10 years and never had a strike in that area? Will he discuss both productivity and production? It is no good having productivity if we decrease production. We are discussing both an increase in production and productivity, which in turn will mean an increase in sales. Will the right hon. Gentleman assure the new president and chairman that the Government will consider other aspects of selling coal, both in this country and outside? For example, many schools could now change from gas to coal, but they do not seem to be able to. Equally, many clubs, such as working men's clubs, could change to coal, and the coal board could sell a vast amount of coal as a result. Will the right hon. Gentleman look into that possibility?

The chairman of the coal board is well aware of the various different avenues for coal sales and is already exploring them actively, both in this country and overseas, where exports have risen substantially. As my hon. Friend the Under-Secretary has already said, while the possibilites in this regard have improved as a result of the improved coal-fired boiler conversion scheme in this year's Budget, nevertheless the paramount need for the industry to become competitve remains.

When the Secretary of State meets the next chairman of the coal board, will he persuade him to get rid of the board's assets in the private sector, especially those firms not engaged in mining activities that are competing unfairly with private businesses?

I believe that my hon. Friend recently raised this matter in an Adjournment debate, to which the Under-Secretary replied. I have nothing to add to what he said then.

Does the right hon. Gentleman accept that the president of the NUM does not need any advice from the Tory Governmet—the sworn opponent of the miners and, indeed, of all workers? If the Secretary of State is so anxious about maintaining a future coal mining industry, why is he so anxious to pour millions of pounds into the nuclear power industry and to go ahead with the PWR system? Why does he not abandon that, put the money into the coal industry and use our indigenous coal reserves rather than attacking the coal industry through the nuclear power industry?

Like their predecessors, this Government believe that our interests will be served both by a strong and competitve coal industry and an increasing share of electricity generation supplied by nuclear power, which is cheaper than any other form of power with the exception of hydro-power, which is limited. However, the hon. Gentleman's cheap jibes reflect more on him than on the matters that we are discussing.

Does the right hon, Gentleman not agree that it would be better for all concerned if a successor to Sir Derek Ezra were announced rapidly? Can the Secretary of State assure the Opposition that the new successor will not be a Tory Party political appointment?

I am grateful to the hon. Gentleman for his advice, which, of course, I shall bear in mind.

Household Costs


asked the Secretary of State for Energy if he will compare the percentage of household costs for a couple on retirement pension with gas as a sole means of energy (a) at the present time and (b) 10 years previously.

For a married couple whose only source of income is the flat rate retirement pension, the cost of enough gas for a cooker and main living room fire—280 therms—has fallen from as much as 8 per cent. of household costs in 1972 to just under 5 per cent. of household costs today.

Does my hon. Friend agree with me that this is very good news and not the sort of news that Labour Members are inclined to let people realise? Will he further say that the Government's policy to free the monopoly in the provision and supply of gas will probably lead to even further reductions in the real costs of pensioners in heating and looking after their houses?

My hon. Friend is entirely right. It is new competition that produces new supply, and competition is always better for the consumer.

Combined Heat And Power (Report)


asked the Secretary of State for Energy when he intends to respond to the Atkins committee report on combined heat and power.

We expect to receive this report later this month and we shall then consult widely among interested parties.

Does my hon. Friend recognise that combined heat and power district heating can develop only if it offers heat at a competitive and attractive price to the consumer, as happens on the Continent, and that this can happen only if the electricity produced by combined heat and power is sold at a fair price and bought at a fair price by the electricity industry? What criteria are the Atkins committee using in considering the cost-effectiveness of a large city scheme on the basis of the price that the nationalised monopoly will pay for the electricity?

I pay tribute to my hon. Friend's enthusiasm for combined heat and power and his expertise on it, which has been most useful and which will be even more useful when we receive the report. The question at issue is not whether combined heat and power district heating schemes can save energy, but whether they can do so economically. I cannot comment on these matters now, for obvious reasons. As my hon. Friend knows, we do not have the report. However, we shall study it and welcome his suggestions at the right time.

Is the Minister aware that, according to a reply given to me by his Department, power stations disperse the equivalent of 67 million tonnes of coal per year in waste heat? Surely this indicates that there should be a far greater sense of urgency in developing combined heat and power schemes.

We are following the recommendations of the Marshall report in setting up the Atkins committee. When we receive the report we shall examine it and act upon it as quickly as circumstances allow. I take the hon. Gentleman's point about electricity generation. However, he will know that it has been the policy of the electricity supply industry and of successive Governments to locate the large 2,000 mw power stations away from centres of population, for sound environmental reasons. These power stations are not the ideal accompaniment to civilised home life. The fact that the power stations do not have a district nearby to heat poses certain problems in making all our electricity generation available for district heating schemes.

I claim no responsibility for the report. Is my hon. Friend satisfied that the lead city concept is still valid?

That concept is at the heart of our considerations. The Marshall report made it clear that 80 per cent. of the potential heat load from a CHP district heating scheme would be in the five major conurbations. We await with interest the report on the nine cities. We shall have to see whether the report recommends further studies.

Is it not already clear that CHP will be more efficient than the present system, will save scarce fuel resources and will provide additional employment opportunities for the 3 million who are unemployed? Would it not be better if the Government were to reexamine their nuclear power programme with a view to building smaller power stations of about 200 mw in various areas, combined with heat systems? Would not that be the best route forward?

I am sure that the hon. Gentleman will not underestimate the good work that the Atkins committee is doing. He knows that the Select Committee on which he serves was able to visit the Atkins committee while it was at work—I do not think that he was able to go—and was left in no doubt about the good and solid work that it is doing. Without that sort of advice it would not be possible for the Government to go ahead sensibly. Everything that I have said, and everything that has been said to my hon. Friend the Member for Derbyshire, South-East (Mr. Rost), indicates that within the Department there is a great deal of interest in the possibilities of CHP. The central issue is whether we can make use of existing power stations in urban areas or whether it will be of the essence of the scheme to build new small power stations economically in such areas. We cannot pass judgment on that issue until we have the report to hand.

When does the Minister think that we might see the first district combined heat and power scheme in operation? Will it be this side of 1990?

The time scale will not be a short one. No one should underestimate the problems that are involved. First, there will be a need to re-equip power stations and, secondly, it will be necessary to establish tine infrastructure. We shall have to grapple with major issues, including the choice that will be presented to the public in certain areas, of accepting the district heating scheme or opting not to do so. These are difficulties that will have to be faced. The Marshall inquiry was dealing with the year 2000 and it calculated that we could save 5 per cent. to 10 per cent. of primary fuel consumption if the economics were right. In looking towards that time scale it is difficult to see a scheme coming into play much before the 1990s.

Industrial Gas Prices


asked the Secretary of State for Energy by how much he expects the price of industrial gas to increase in 1983.

The price of industrial gas in 1983 will be influenced by the British Gas financial target and prevailing market conditions. The November NEDC report showed clearly that the majority of industrial gas consumers in the United Kingdom enjoyed prices that were at or below those paid by their European competitors. Following the action announced in the Budget to freeze industrial gas prices for the rest of this year, I have no reason to believe that United Kingdom prices will not remain competitive in 1983.

May I congratulate my hon. Friend on the help that is being given to British industry through the freezing of gas prices this year? Does he accept that this will give a welcome boost to jobs as our industry will have a competitive edge over our Continental rivals' prices? Will he confirm that, apart from basic cost increases, there will be no general increase in gas prices over the next few years?

It is difficult for me to prejudge the future. Suffice it to say that this area of activity is profitable. In such a profitable area one sees no reason for any radical change in pricing policies.

Will the Minister take into account the fact that some industries have great difficulty in converting from the use of coal? Does he realise that the glass industry is finding it difficult to use oil because of the huge costs involved and would like to transfer to gas if the Government offered it a grant? Will the Government consider doing that? Instead of reducing the price of oil from $34 a barrel to $31 should we not continue to sell at $34 so that we can help industries that are present unable to use coal efficiently?

I am sure that the hon. Gentleman will be pleased to know that his advice, and that of others, was taken into account by the Chancellor and that we have added to the oil boiler conversion scheme those who are converting from gas to coal.

Will my hon. Friend either confirm or deny that the recent increase in domestic gas prices now means that British Gas will make a small profit in the domestic sector while its vast profits will come from industry?

After this year's increases we expect to see a return to profit in the domestic sector. The profits are not excessive. We are talking about a post tax profit of £156 million, which is a 1·6 per cent. return, in the current financial year. That will come from the industrial and commercial sector.

Is the Minister aware that the Confederation of British Industry in the Northern region is publishing a report that proves that the majority of manufacturers are having to cut their prices to retain their markets? How does he expect those same manufacturers to manage in 1983 when it is obviously the Government's policy to increase energy charges?

It is the height of cheek and absurdity for Labour Members to make such absurd comments. Industrial gas prices are about 24½ per cent. cheaper than they would have been if the policies of the Labour Government had been followed. This has been achieved by the Government's actions.

When does my hon. Friend expect private supplies of gas to be available to industry? Does he imagine that the price of this gas will be higher or lower than that which is offered by the British Gas Corporation?

There is a happy prospect of competition in supply, and the opportunity for the consumer to receive more than one offer of gas, I hope that that will come in the not too distant future following the successful completion of the Oil and Gas (Enterprise) Bill. My hon. Friend is right to draw attention to the opportunities that competition will offer to those in industry who seek competitive supplies.

Whatever the supply and demand influences, is it not likely that in a pre-election year there will be no increase in energy prices under the control of the Government?

I made it clear in the debate on this subject that these policies were introduced to the House in January 1980. That seems considerably in advance of an election.

Wave Power


asked the Secretary of State for Energy when a decision will be made on the preferred system for wave power and the scale of Government funding for it.

When I have had the opportunity fully to study a report and the advice on the renewables programme from the advisory council on research and development for fuel and power.

Is the Minister aware that there is a suspicion in some quarters that the Government would like to sink the wave power experiments? Is he aware that this is an enormously important renewable source of energy, especially for this country, and that there are possible world markets? Will he get a move on with his study into which system to fund and give an assurance that there will be generous funding for it?

I utterly repudiate the implication of the hon. Gentleman's comment that we have somehow been marking time on the matter. In cash terms, the Government are spending this year four times as much on research and development into the renewables programme as did the Labour Government. I do not know how impatient the hon. Gentleman was with the Government that he supported. After £12 million of public money has been spent on the wave programme, the advisory council is examining the whole renewables programme to see where we go from here. This is a sensible step, being undertaken by accomplished scientists and engineers. I await their advice with interest.

Does my hon. Friend agree that, on current costing of wave power, this is an energy option for the medium rather than the short term? If he does agree, will he consider, before taking his decision, such schemes as Salter's bobbing ducks, which are being developed in my constituency and which, for a small investment, show great potential for the medium term?

There is enormous admiration within my Department for the work that Dr. Salter is doing on a very accomplished piece of engineering.

Will the Minister confirm that while he is studying the report, experiments are still continuing? Can he give an idea when he expects that some electricity developed by wave power will be going into the grid?

I cannot do that in respect of wave power. It is too early to say. The right hon. Gentleman will be more aware than most hon. Members of what the Government are doing on renewables. It is in his constituency, on the Orkneys, that we have moved to demonstration by supporting to the tune of £4½ million the construction of an aero-generator to produce electricity from the wind, of which I gather, in his part of the country, there is quite a lot.



asked the Secretary of State for Energy on what basis he will assess the most advantageous time to put the shares of Britoil on the market.


asked the Secretary of State for Energy if he will arrange, at the appropriate time, for British National Oil Corporation shares to be available for purchase by individual members of the public through the Post Office network.


asked the Secretary of State for Energy if he will make a statement on the criteria by which he will assess the most opportune time to put the shares of Britoil on to the market.

Britoil will be sold to the public this year unless market conditions in the autumn are such that there is a convincing case for delaying until next year. Whenever the flotation takes place, I shall be seeking to secure a wide spread of ownership.

Is not the best way of obtaining wider share ownership the distribution of shares through the Post Office network, to be purchased by individual members of the public? Is it not possible for the national savings certificate system to be used in this regard?

I am grateful to my hon. Friend and also to my hon. Friend the Member for Derbyshire, South-East (Mr. Rost) for putting forward some helpful suggestions. All these ways and means of getting a wider spread of share ownership than is customary are being examined carefully. There are certain practical difficulties, but we are taking the suggestions seriously.

The hon. Member for Dunfermline (Mr. Douglas) will be aware that the Government that he supported made a large offer of BP shares in 1977. That offer was underwritten.

Will the Secretary of State inform the House of, and discuss with it, the actual method of sale before he proceeds?

I am not sure that it is sensible—I cannot think of any precedent—to discuss with the House anything so technical and complicated as the precise methods of sale. If the right hon. Gentleman and his hon. Friends want to put forward any proposals, I shall be happy to consider them.

On a point of order, Mr. Deputy Speaker. In view of the unsatisfactory nature of the reply I beg to give notice that I shall seek to raise the matter on the Adjournment.

North Sea Oil And Gas (Exploration)


asked the Secretary of State for Energy if he will estimate the effect of the fall in oil prices and the changes in the tax regime on the level of exploration for oil and gas in the North Sea.

I do not expect these factors to have a significant effect on the level of offshore exploration.

Surely the Secretary of State must bear in mind that, with spot prices down to $28 a barrel, and with the announcement that the Government expect the same yield from the North Sea, this will deter anyone looking for commercial profit from going ahead with the exploration programme that was envisaged by the Government?

It is true that these are uncertain times in the oil market and that this is making all oil companies review their investment plans and assumptions throughout the world. That is inevitable. However, the level of exploration in the North Sea is higher than it has been for many years and there is no sign of any slackening, despite the tax changes that were announced a little over a year ago.

If it is the case that there is a pullback in investment in the North Sea—and the oil companies say when they meet hon. Members that this is the fault of the tax regime—has the Secretary of State discussed this with them to disprove the point that they are making?

I see representatives of the oil companies both in concert and singly on many occasions, as the right hon. Gentleman will imagine. There is no doubt that the oil companies would like to see a lighter tax regime. My right hon. and learned Friend the Chancellor of the Exchequer examined the matter carefully and reviewed it in the light of all the evidence, including investment plans, and came out with a new tax system that, with regard to structure, went a long way towards meeting the points made by the oil companies. With regard to the level of taxation, there was only a slight amelioration, but there was some. My right hon. and learned Friend is satisfied that that is a tax system that is fair both to the oil companies and to the general body of taxpayers.

Is not the rate of oil exploration a long-term matter? Therefore, is it not correct that it is as much the general state of the economic situation across the Western world as the immediate tax regime that affects the oil companies' business plans for the future? To that end, is it not a fact that when my right hon. Friend successfully launches Britoil in the current financial year it will show the Western oil companies that we believe in a successful and forceful policy in the North Sea''

I entirely agree with my hon. Friend. He may have read the article in the Sunday Telegraph yesterday, which pointed out the considerable attractions of Britoil for the investor.

Common Energy Policy


asked the Secretary of State for Energy what progress was made at the last meeting of the European Energy Council in agreeing a common energy policy.

The Council of Energy Ministers on 16 March renewed its commitment to reduce dependence on imported oil and to the more efficient use of energy. Commission papers on coal, nuclear power, gas and investment in the efficient use of energy were considered, but were not ready for decisions by this Council.

Will my hon. Friend ensure that we, as the leading energy producer in Europe, lead any discussions on a common energy policy and not opt out, as would the Labour Party?

While I recognise the necessity of working towards a common energy policy within the EEC, I should point out to my hon. Friend that priorities are not always the same for every member country. Considerable progress has been made on such things as energy pricing and conservation and the reduced dependence on oil, as well as the fusion programmes. Progress is being made, if not perhaps as quickly as my hon. Friend would wish.

Will the Minister assure the House that no common energy policy will mean the loss of national control over all our energy resources?

That would be the wish of every hon. Member and the objective of the Government.

Will the Energy Ministers in Europe make sure that the reserves of oil are not reduced below the levels recommended by the International Energy Agency just because there happens to be a surplus and lower prices now? Would this not be a dangerous development in view of the possible strategic advantages that can accrue from the maintenance of those reserves at a reasonable level?

My hon. Friend will be aware that the maintenance of adequate reserves need not necessarily conflict with the economic use of oil, which is the objective of the Community.

Can the Minister of State give us any good reason why he believes that there should be a common energy policy in Europe?

I am sure that the majority of hon. Members would agree that there are vast areas in energy where a common energy policy is advantageous. However, I pointed out at the outset that the priorities of countries are different, and therefore, across-the-board energy policies may be much more difficult to achieve than seems likely now.

When the Minister says that there are vast areas in energy where a common energy policy is advantageous, could he give us just one example to help us?

There is little doubt that, as I suggested at the outset, a common form of energy pricing would be advantageous for energy conservation. Realistic energy pricing is essential.

Combined Heat And Power Projects


asked the Secretary of State for Energy when he expects to announce the results of consultants' reports on projects for combined heat and power systems.

The results of our consultant's investigations on combined heat and power will be announced after consultation with interested parties.

While I thank the Minister for that reply, may I ask him whether he would agree that the results of the investigations are taking rather a long time? Does he agree that there are a number of power stations in the country that would be suitable for active experiments on a large scale with this sort of project? Cannot the hon. Gentleman hurry up the programme?

The Atkins committee, which was set up following Dr. Marshall's inquiry, was originally due to report in January. There has been a small slippage to April, which those who follow these matters will understand, having regard to the complexity of the issues that are involved. I assure the hon. Gentleman that we are interested in the whole idea of heat and power district heating schemes and we shall be studying the report with great interest when it arrives shortly.

Meanwhile, are not local power stations being closed in rapid succession? They are the very sorts of power stations that would be ideal for combined heat and energy schemes. Why do not the Government hurry up the process and stop the closure of these power stations, because some people are suspicious that this is being done to create capacity to be filled with nuclear power generation?

If the electricity supply industry, whose decisions these are, were to fail to close small and uneconomic power stations and that led to an increase in the price of electricity, the first person to complain would be the hon. Member for Keighley (Mr. Cryer).

Can my hon. Friend confirm that when the Oil and Gas (Enterprise) Bill becomes an Act it will provide an important stimulus to the development of combined heat and power, because the gas monopoly has restricted the use of gas to industrial CHP?

It is right that we have shown some concern at the apparent difficulty of combined heat and power schemes using gas getting off the ground because of supply difficulties. There is no doubt in the mind of the Government that the effect of the Oil and Gas (Enterprise) Bill will be to make more supplies of gas available to a domestic market that is currently underprovided for.

Will the Minister confirm that the only power stations that are being closed are the old, small, clapped-out ones that would cost an absolute fortune to modernise and put back into commission?

I am very grateful for the robust common sense of the hon. Member for Newton (Mr. Evans). According to the merit table that the electricity supply industry has to use, the difference in the costs of generation in a large, efficient power station compared with some of the smaller ones is so marked that we cannot allow sentimentality to intrude on what is a case of hard economics, as I think the hon. Gentleman recognises.

House Of Commons

Scottish Grand Committee


asked the Lord President of the Council what arrangements are being made for further meetings of the Scottish Grand Committee to be held in Scotland

The Lord President of the Council and Leader of the House of Commons
(Mr. Francis Pym)

Further sittings of the Scottish Grand Committee in Edinburgh will be announced as soon as possible in the light of consultations through the usual channels.

Is it not a fact that most of the debate in Edinburgh was taken up by Ministers and ex-Ministers? May we have an extension of the time of the sitting beyond 1 pm to allow more Back Benchers to take part in the next debate? Will the right hon. Gentleman give an assurance that the Government definitely intend to continue with the experimental sittings in Scotland, despite some reports to the contrary and the reluctance of some hon. Members who seem to prefer the fleshpots of Westminster to the invigorating atmosphere of Scotland?

It is our intention to hold further sittings as part of the experiment. It must be done by mutual arrangement and agreement through the usual channels. The length of the sittings and whether it would be convenient to extend them beyond 1 pm should, I think, be decided at the time. A number of hon. Members believe that 1 pm is the most appropriate time to conclude. I wish to make an arrangement that is convenient and suitable to the House as a whole.


On a point of order, Mr. Speaker. On question No. 25, tabled by the hon. Member for West Stirlingshire (Mr. Canavan), there was only one supplementary question. You allowed no question from a Government supporter. This is a very serious matter in Scotland——

Order. It so happens that I was not in the Chair at the time. I took the Chair immediately afterwards. There is no prescriptive right to ask supplementary questions on other hon. Members' questions.

Lord President Of The Council

Government Information


asked the Lord President of the Council if he will list his responsibilities for the coordination of Government information.


asked the Lord President of the Council if he will list his responsibilities for the coordination of Government information.


asked the Lord President of the Council if he plans any new initiatives in co-ordinating information supplied by Her Majesty's Government.

My role is to give advice and assistance to individual Ministers, who are responsible for their own departmental information, and I keep these matters under continual review.

Is the Leader of the House aware that my constituents, who take a close interest in politics, have difficulty in analysing the coded messages that they are told are coming through in speeches by the Minister of Agriculture, Fisheries and Food regarding Government policy and the Government's stance generally? Will the right hon. Gentleman help by providing a glossary of terms to enable people to understand the messages that the Minister of Agriculture, Fisheries and Food conveys?

The Government as a whole and individual Ministers make their position, views, policies and programmes very clear. I do not think that the policies and programmes of any previous Government have received so much public discussion and debate as those of the present Administration. Ministers are capable of making clear what they mean, and none more so than my right hon. Friend the Minister of Agriculture, Fisheries and Food.

Does my right hon. Friend advise the British majority group in the European Parliament of relevant Government information?

No. I do not think that it is part of the Government's information machine. There are a number of contacts between my right hon. Friends as Ministers and the European Parliament, but there is no direct link. It is not part of the Government's information machine.

Does my right hon. Friend agree that one of the most vital areas of dissemination of information is the Government's policy on the Falkland Islands issue? Will he and his colleagues consider the possibility and the advisability of Her Majesty the Queen making a broadcast to the people of the Falkland Islands?

I doubt whether that would be appropriate. My right hon. and noble Friend Lord Carrington has broadcast to the people of the Falkland Islands in the course of the last 24 hours. I believe that is adequate. As to the general position, it is difficult for anyone to read anything in the press except comment and discussion of the Falkland Islands issue.

Did the Lord President advise the Foreign Secretary and the Defence Secretary that, as soon as the first shot was fired, they would be taking on right, left and centre the entire Spanish-speaking world, including many of those who have suffered at the hands of Right-wing Governments and who still believe that the Malvinas, or Falkland Islands, belong to a South American State 400 miles away, not a European State 8,000 miles away?

In view of the Government's unanswerable case for committing our forces to the South Atlantic to recover our land, will my right hon. Friend suggest to the Prime Minister that a broadcast to the nation setting out the Government's position and the national imperative should be made soon?

In view of the information that we have had today, and in the light of the right hon. Gentleman's responsibility for the co-ordination of Government information, will he arrange for a statement on the resignation of the Foreign Secretary to be made—perhaps by the Lord President of the Council or even by the next Foreign Secretary?

That would not be in accordance with custom or precedent, but no doubt the matter will he referred to at various moments on other occasions

On a point of order, Mr. Speaker. I wish to raise a point of order of which I gave you notice and which I believe affects——

Order. If it is about the matter of which the hon. Member for West Lothian (Mr. Dalyell) gave me notice, it is not a point of order. He made a mistake by announcing that he had told me what it concerned. I think the hon. Gentleman wishes to pursue an argument, and that is not a point of order. It cannot be a point of order which requires my ruling.

On another point of order, Mr. Speaker. Those of us who pursue the courtesies of the House, as most of us do, when Ministers refuse to give way and do not press them——

Order. The hon. Gentleman has been here long enough to know that that is not a point of order for me.

Argentina (Trade)

3.31 pm

(by private notice) asked the Secretary of State for Trade what advice, instructions or regulations he is giving or introducing to cover those companies or organisations which are trading or which have contracts with Argentina.

It was announced on 3 April that the Government had frozen all Argentinian financial assets held in this country, that ECGD would not provide new export credit cover for Argentina, and that exports of military equipment and arms to Argentina had been prohibited. Other economic measures are being urgently examined, and we are consulting our European Community and other allies. British citizens are advised not to travel to Argentina, and British companies to withdraw their non-essential British staff. British firms must decide what action they should take in relation to existing commitments in the light of the present circumstances, the measures which have so far been announced, and the terms of their own individual arrangements with Argentinian firms. They are advised not to enter into new commitments.

Meanwhile, right hon. and hon. Members will recall that the Prime Minister told the House on 3 April of the Government's intention to despatch a substantial naval task force to the Falkland Islands. I should like to take this opportunity to announce to the House that Her Majesty assented to an Order in Council enabling the Government to requisition any vessels that may be needed, under the long-standing contingency plans available to meet national emergencies of this kind. The P & O liner "Canberra", whose captain is an officer in the Royal Naval Reserve, is being transferred to naval control this afternoon. Other ships will be requisitioned and chartered as necessary.

I thank my right hon. Friend for his reply. May I ask him two questions? Is he suggesting that firms which have existing commercial contracts with the Argentine should continue delivery under those contracts? Secondly, what action does he consider should be taken where, obviously, the Argentine will attempt to obtain spare parts for equipment made in Britain from third or fourth countries? Will the Government look very carefully at that position, especially where military equipment is involved?

Replying to the first of my hon. Friend's questions, no general ban currently exists on exporting to the Argentine.

As for my hon. Friend's second question, of course, there is a ban on the export of arms and supplies from this country, and undoubtedly we shall do our utmost and shall expect our allies to assist us in that prohibition.

Is it not the case that, apart from the obviously necessary ban on arms exports, other sanctions on or interruptions in trade are inevitable and must be proportionate to the dispute which the United Kingdom has with Argentina? Will the right hon. Gentleman describe what he thinks those further sanctions or interruptions should be?

Can the right hon. Gentleman describe to the House what compensation, protection and support will be afforded to British firms and workers who suffer loss and injury from the interruption of trade with Argentina? Can he say expecially that the losses on the Export Credits Guarantee Department will be borne by the Government and not be exporting firms? The trading consequences of losses ought to be borne by the Government because these matters flow from their conduct of these proceedings.

May I ask the right hon. Gentleman about the EEC and our other trading partners? Our trading arrangements with the EEC have not always been favourable in international terms. On this occasion, will he have immediate consultations with our trading partners in the EEC, and will he confirm that they will support us to the full in those trading sanctions, whether they relate to arms or other matters, which may be necessary to support and further Britain's cause in this matter? Can the right hon. Gentleman say what other trading support he will get from members of NATO and other defence pacts to which we belong?

Perhaps I may answer the hon. Gentleman's questions in reverse order. We are in consultation with our European Community partners with a view to co-ordinating as far as possible and making economic response to the present situation.

Dealing with the hon. Gentleman's second question, it is true that any interruption of trade which derives from a conflict such as this results in losses to a very large number of companies and people. This has always been true historically, and no doubt it will be equally true on this occasion. The same convention will apply on this occasion as applied within the lifetime of previous Parliaments.

As for our taking economic action, of course, this is a matter under careful review. We shall take account of the hon. Gentleman's aspirations that it should be proportionate to the dispute.

Order. This is an extension of Question Time, but I propose to call two hon. Members from each side of the House before moving on.

With regard to contracts entered into by British firms and companies with Argentine interests, will not the British concerns be entitled to pray in aid the doctrine of frustration, well known in commercial and international law, and would not they be well advised so to do?

Obviously that is a factor which will be borne in mind when the Government consider the next development in economic reactions.

Given that the last full trade statistics were published in 1978, can the Secretary of State confirm that an embargo, taking total proportions of trade, would still be about 10 times more injurious to the Argentine than to us?

I am not sure that I want to take up the hon. Gentleman's statistics, but I can tell the House that our exports account for about 3 per cent. of the Argentine markets and that we account for 3 per cent. of their exports.

Although I welcome what my right hon. Friend said about the cessation of arms sales from this country, will he make urgent representations to the Heads of Government of France, Italy and the United States, whose ground support in Argentina not only made the invasion possible technically for the Navy and Air Force of the Argentine but would also make it possible for the Argentine to sustain a counter-attack against our own forces?

I am certain that any helpful economic response in this dispute can best proceed if we are supported fully by our nearest allies in the European Community.

Is the Secretary of State confident that our trading relationships with other Latin American States will not be disrupted by them as a result of the continuance of this dispute?

No one can be confident in replying to such a question, but I hope very much that the dispute can be localised and that the mutual good interests that lie between this country and other Latin American States can be sustained.

Business Of The House

3.39 pm

The Lord President of the Council and Leader of the House of Commons
(Mr. Francis Pym)

With permission, Mr. Speaker, I should like to make a short business statement.

The business on Wednesday 7 April will now be a debate on the Falkland Islands, on a motion for the Adjournment of the House.

I thank the right hon. Gentleman for his statement. It was clearly the desire of the House on Saturday that there should be a further debate at the earliest possible moment. However, in the light of the announcements made today, can the right hon. Gentleman tell the House who will be speaking for the Government in the debate?

I cannot answer that matter of detail at this moment. I assure the right hon. Gentleman that the Government's position will be put clearly and in a forthright way, as no doubt will that of the Opposition.

Northern Ireland (Political Developments)

3.41 pm

I will, with permission, make a statement on political developments in Northern Ireland.

The Government have today published a White Paper setting out proposals for the election of an Assembly, which would provide a framework within which a devolved Government might again be set up in Northern Ireland. These proposals are designed to meet two objectives: first, to provide at once a means for greater democratic participation by the people of Northern Ireland in their own affairs; secondly, to give them the opportunity to evolve for themselves a form of government acceptable to them.

The Government propose that there should be an election later this year to a new Northern Ireland assembly. While consideration of the arrangements for a devolved administration will be its most crucial task, the Assembly will from its first day have important scrutinising, deliberative and consultative functions. It will be able to report on a wide range of topics, and its reports will be laid before Parliament. The Assembly will establish Committees corresponding to each of the Northern Ireland Departments to monitor and report on their policies and activities.

The Assembly will from the outset be empowered to recommend arrangements under which the whole or part of the full range of legislative and executive responsibilities, which were devolved in 1973, could be exercised by the Assembly and by a devolved administration answerable to it. If the Assembly sends to the Secretary of State proposals which have the support of 70 per cent. of the total membership of the Assembly, he will be required under statute to lay those proposals before Parliament for its consideration. He would also have discretion to present to Parliament proposals which did not command 70 per cent. support but which in his view enjoyed the support of both sides of the community in Northern Ireland.

I should like to make two things clear: first, the parties in Northern Ireland will have wide discretion about the basis on which a devolved administration and Assembly might be formed and operate—Her Majesty's Government are not seeking to impose any particular system; secondly, the Government would not recommend any arrangements to Parliament unless they believed them to be acceptable to both sides of the Northern Ireland community. Stable government can come only from such acceptability. If Parliament approved the Assembly's recommendations, powers would be devolved by Order in Council.

The Assembly will have the option of moving to full devolution of powers from the outset or, if if seems easier to achieve agreement on devolving the responsibilities of only some Northern Ireland Departments, to make proposals for partial devolution.

The arrangements will be flexible in that partial devolution could lead to further or full devolution, and if the agreement on which devolution was based collapsed and could not be re-established it would be possible for the Assembly to revert to its scrutinising, consultative and deliberative functions, with the Secretary of State taking back other responsibilities.

Direct rule has served Northern Ireland well. It was, however, introduced as a temporary arrangement. It does not provide satisfactory political structures through which a divided community in Northern Ireland can make the necessary mutual accommodations to tackle its special problems. For Northern Ireland requires new political arrangements suited to its unique character. These must reflect the history of the Province and its long experience of devolved government and must recognise and respect the differences of identity and aspiration which exist there. The proposals in the White Paper take account of those circumstances. At the same time, they are firmly based upon Northern Ireland's position as a constituent part of the United Kingdom for so long as that is the wish of the people of Northern Ireland.

The Government are convinced that good relations with the Republic of Ireland are of great importance. These relations are for the sovereign Governments and Parliaments. It is for the London and Dublin Parliaments to consider whether the governmental meetings of the Anglo-Irish Intergovernmental Council should be complemented by an Anglo-Irish body at parliamentary level in which members of an elected Assembly in Northern Ireland could take part. In addition, it would remain open to a devolved administration in Northern Ireland to make such bilateral arrangements and agreements with the Government of the Republic as it wished concerning the matters for which it is responsible.

The problems of Northern Ireland are formidable. The evil of terrorism has struck at the lives and expectations of ordinary people, Catholic and Protestant alike, for far too long. The economic decline is more acute and more intractable than elsewhere in the United Kingdom. The Government believe that the defeat of terrorism, the recovery of the economy, and the establishment of effective political institutions go together and support one another. An end to the political deadlock of recent years offers the best hope of a sustained improvement in the economy and in security.

The proposals in the White Paper are fair and flexible. Like all proposals for Northern Ireland, they involve risk and controversy. The Government in no way underestimate the magnitude of the task or the strains any proposals will have to bear. But they also offer an opportunity which, with time and patience and the continued commitment and good will of Parliament, may be exploited to the advantage and relief of all the people of Northern Ireland.

I thank the Secretary of State for presenting the White Paper to the House today. We hope that it will put an end to rumour and lead to a constructive debate about constitutional arrangements.

Is the Secretary of State aware that we agree on the pressing need for peace and reconciliation in Northern Ireland, and that we think it right that the people of the Province should be given opportunities for broader political participation? Does he accept that we favour devolution of political power to Northern Ireland, and that we find the proposals broadly in line with what we would wish to do and build on? However, will he accept that the time is not altogether right for these proposals? Where economic and social conditions are so depressed, and where one in five of the workers in Northern Ireland is on the dole, it is unlikely that there will be a wide or enthusiastic response to constitutional changes.

Does the Secretary of State recall that when we were in office we took the view that political progress would be lasting only if people had safe jobs and decent social conditions? Have not the Government, in choosing to go the other way, put the cart before the horse? Does the Secretary of State accept that far more attention should be devoted to creating jobs in Northern Ireland than to righting social wrongs?

Putting those doubts aside, we support the plan for the election for an Assembly, and we hope that Northern Ireland politicians will take part in the elections. Does the Secretary of State agree that there is no better way of isolating the men of violence than by participating in legitimate forms of political activity? From what the Secretary of State said, it appears that new legislation will be necessary. Can he say when that legislation will be published? Does he realise that we shall have many questions to ask, not least about the confusion that may occur when political heads of departments are responsible to two different Assemblies? We shall look for strong safeguards to prevent abuse of executive power and to protect minorities from discrimination? Additionally, we shall want to be assured about the ultimate power of Parliament and the ability of this House to debate Northern Ireland matters, even when power has been totally devolved.

Will the Secretary of State note our disappointment about how little has been said relating to the Irish Republic? Will he confirm that the only channels through which members of the Northern Ireland Assembly may partake in the Anglo-Irish dialogue will he the parliamentary tier of the Anglo-Irish Intergovernmental Council? If that is so, will he give the House an assurance that the Government will allow time for the House to debate the merits of a parliamentary tier to that council? Further, will he look into the possibilities of allowing Northern Ireland representatives to take part in the Anglo-Irish council at other levels, pending the introduction of the parliamentary tier? We give a cautious welcome to the White Paper, and will the Secretary of State accept the Opposition's wholehearted endorsement of the theme of his statement and of the White Paper that all new structures of government in Northern Ireland must be acceptable to both sides of the community?

Such a principle must lie at the centre of our deliberations on this subject.

Finally, is it the Government's intention to have a separate debate on the White Paper? That would have a great deal of support in the House.

I am grateful for the support that the right hon. Member for Mansfield (Mr. Concannon) has given to some of the proposals in the White Paper. I recognise that any Minister seeking to embark on a course of trying to restore political stability to the people of Northern Ireland is bound to find certain areas of controversy. The more that I can win and hold the support of all hon. Members, the better it will be for the people of Northern Ireland to see that we are determined to press ahead sensibly and that we are prepared to leave to the people of Northern Ireland as much as we can.

Economic stability and prosperity go hand in hand with the political and security situations. One cannot achieve the one without at the same time seeking by every means possible to deal with the other two. The economic situation in Northern Ireland has deteriorated and continues to deteriorate. Regrettably, part of the reason for that is the lack of political stability in the North of Ireland as a whole.

Subject to what my right hon. Friend the Leader of the House might have to say, I would welcome a debate on the White Paper before debating the Bill, but I think that, in a matter which concerns the transfer of powers and fitting the new proposals into the context of the Northern Ireland Constitution Act 1973, it would be convenient if the House had the Bill presented to it before the White Paper debate. We would then have both in front of us even if we had, as we should, a separate debate on the White Paper.

I can confirm that it is for the Parliaments of the Republic and the United Kingdom to reach a decision about the parliamentary tier, but I hope that Members of the Assembly would be able to take part in any arrangement that is made. This ought to be a gradual process, and it is one on which all parties in the House and perhaps in the Parliament of the Republic will want to proceed with care if it is to be successful and if we are to remove the suspicions which will otherwise surround the initiative. There will also be opportunity for debates on those matters.

On the very day that the Armed Forces of the Crown are embarking on an expedition to free British subjects from foreign domination in the South Atlantic, is it not utterly shameful that a Minister of the Crown should come to the House on the pretext of improving internal government in part of the United Kingdom and launching an operation to erode the rights and privileges of British subjects within the United Kingdom, and in so doing using almost the same terminology as that employed in the statement on the Falkland Islands made by a Foreign Office Minister in the House in December 1980?

The hon. Gentleman does himself, his party and his fellow countrymen a grave disservice by such remarks. It could be interpreted that on a difficult day for the Government—we all know that it is a difficult day for the Government—we still thought that it was right in the interests of the people of Northern Ireland that we should face up to the difficulties as we are. I admire the people of Northern Ireland and I do not wish the hon. Gentleman's statement to detract from anything that happens in Northern Ireland or from all the great successes and contribution of British soldiers and the security forces in Northern Ireland.

I welcome the Secretary of State's proposal for an elected Assembly in Northern Ireland with the powers that were envisaged in the convention report, but does he not recognise that the different valuation that he proposed to put on the religious and political colour of votes in the Assembly is repugnant to democracy in Northern Ireland? Will the right hon. Gentleman explain why a 70 per cent. vote is demanded of the Unionist people who do not want power sharing of a united Ireland, but only 50 per cent. plus is demanded of those who will not even recognise the security forces that the right hon. Gentleman has praised but who want to destroy the position of Northern Ireland within the United Kingdom?

Will the right hon. Gentleman explain why the Assembly is not to be given its proper freedom to appoint or not to appoint people to the Council of Ireland? Surely the Assembly itself has a right to make a decision on such an important matter.

Paragraph 4 of the introduction to the White Paper states:

"The Government's proposals do not require any group in Northern Ireland to compromise its deeply held beliefs. They provide an opportunity for both sides to create a workable form of government in the interests of the common good and in the face of the urgency of the Province's problems. It will be for the people elected to a Northern Ireland Assembly to decide whether they are prepared to adopt this approach."
If it is the case, as the hon. Gentleman suggests, that the people are not prepared to move forward to a form of devolved government which involves both sides of the community, either through a 70 per cent. vote, or, as I have suggested, by something less which still has cross-community support, a devolved Government will not come into being. But there are other important matters that an Assembly in Northern Ireland could still undertake. It is in the spirit that there has to be some movement and compromise if Northern Ireland is to escape its problems that we are putting the proposals for an evolving form of devolution before the House.

At a time when the United Kingdom is on the brink of a conflict which may be both grave and long lasting, would it not be wise for the Government, having presented their White Paper, to allow mature time for it to be considered by the House and all those concerned in Northern Ireland before they committed themselves to the form of legislation or introduced a series of debates in the House and in Northern Ireland which might have the effect of creating division when unity is what is needed in the coming weeks?

No one will do more than Ito seek greater unity. I shall do all that I can to sustain and promote such unity. I believe that the unity of the United Kingdom is a great aim and goal to be protected and preserved at all costs.

On the question of debates, I recognise that this is an important matter for the House and the country. We should see how we get on. I do not think that we need to rush things unduly, but, at the same time, there are some who have suffered for many years. Are we to neglect their problems because of events in other parts of the world? We have a responsibility for the whole of the United Kingdom, and it is a responsibility which we shall discharge.

Is my right hon. Friend aware that his proposals seem likely to be deeply divisive, not only in Northern Ireland but in the House and, I suspect, in the Conservative Party? Is he aware that they will be seen partly as implying Government support for the idea of a united Ireland and as leading inevitably to an encouragement of a revival of the devolutionist movement in Scotland and Wales?

May I join the right hon. Member for Down, South (Mr. Powell) in urging my right hon. Friend to let us debate the White Paper at leisure before there is any question of legislation being tabled so that he may take the feeling of the House before he finally commits himself?

I have already said that I believe that it would be right to have a separate debate on the White Paper. I do not believe that there is any connection between the problems of Scotland and Wales and those of Northern Ireland. Northern Ireland had a devolved Government for 50 years. Its political parties are not organised in the manner and on the basis of the political philosophies of the parties in other parts of the country. Of course, there is also the problem of the percentage of the minority who identify with a united Ireland. For all those reasons, I do not believe that there is a connection with the problems of Scotland and Wales and what we seek to do in the interests of the people of Northern Ireland is not connected with what we do for Scotland and Wales.

As for the issue being divisive, any proposal put forward in Northern Ireland is unlikely to be able to bridge the chasm between those who aspire to the nationalist cause and those who aspire to the Unionist cause and is, therefore, bound to create divisions. All that I can say to my right hon. Friend and to other right hon. and hon. Friends is that I seek no division within the Conservative Party. I will do all that I can to explain why I believe that our proposals are in the interests of all the people of Northern Ireland and in the interests of the United Kingdom as well.

Will the right hon. Gentleman accept that many in the United Kingdom will expect the political parties in Northern Ireland to give his proposals careful and constructive consideration? Can he tell us whether the Assembly will be able, if it wishes, to consider the economic links between the North and the South and report on them, bearing in mind that that could be of considerable assistance to the people of Northern Ireland?

That will be a matter for the Assembly to decide. In days gone by, there were far closer economic links and discussions between Stormont and the Government of the Republic than there have been in the past 10 years. I do not wish to say anything that might make the re-creation of those links more difficult. It is best to leave the Assembly and the Government of the republic to sort out those matters themselves, but there are a number of matters on the economic side that would be helped by closer co-operation. I am certain that that is one of the points to which the Assembly will wish to turn its hand.

Order. There is another statement to follow. I will allow questions on this subject until 4.20 pm. I hope that we shall have quick questions and answers.

I do not doubt the Secretary of State's sincerity, but does he realise that regret will be felt in Northern Ireland that he has made no promise about introducing a Bill of Rights before the establishment of an Assembly and no reference to the ending of religious apartheid, at the taxpayers' expense, in education?

Does the right hon. Gentleman understand that the Anglo-Irish Intergovernmental Council and parliamentary tier are detrimental to the interests of the people of Ulster, because we believe that the Foreign Office is involved in selling out the people of Northern Ireland?

I am sorry that we have not so far found time to include provisions on human rights in legislation. It is a complicated issue. We have done a great deal already, but more remains to be done. I take seriously what the hon. Gentleman said about education, because that is of very great importance.

I hope that the hon. Gentleman will not pursue his comments about the Foreign Office. Northern Ireland is a part of the United Kingdom and remains a part of the United Kingdom. The consent of the people would be required for any change in that arrangement, and that consent is not forthcoming. I hope that over a period of years the Government and I will be able to show to all the people of Northern Ireland the great benefits of remaining part of the United Kingdom.

I accept the Secretary of State's dedication, but is it not a fact that three important elements on the island of Ireland—the Official Unionist Party, the SDLP, which is the party of the minority, and the Taoiseach and Government of the Republic—have expressed not only reservations, but total opposition to the proposals in the White Paper? If they maintain that attitude and the parties seek a mandate from their electors on their opposing ideologies, will not tha mean that the executive will have no hope?

Everyone of good will wishes the Secretary of State well in his endeavours to re-create parliamentary structures in Northern Ireland, but does he agree that if the ground is not well planned in advance and there is another failure it will be a total disaster for Northern Ireland into the foreseeable future?

Carrying on as we are is not a policy which carries no risks. That is one of the factors which I had to weigh up. I have also had to bear in mind that there is considerable resistance to the proposals that I am putting forward, but in Northern Ireland—as in some other parts of the world—it is easier to be against something, because that means that people do not have to go further in explaining their point of view.

I hope that the hon. Gentleman will use his considerable influence—it is a considerable influence and one which is greatly admired in the House—to do what he can to help the House bridge the gap that is so detrimental to all the people of Northern Ireland, but, perhaps above all, 10 those who have suffered most—the ordinary, decent, working class people.

Is the Secretary of State aware that Liberals welcome his initiative and congratulate him on the patience, determination and speed with which he has produced the proposals? Few politicians are less divisive than the Secretary of State. Is he aware that we greatly welcome the fact that he recognises that the Assembly must be representative and that, if it is to be representative and, therefore, effective, it must be elected by proportional representation?

The Assembly would be elected by proportional representation, on the same basis as the previous Assembly was elected. I point out again that we will leave it to the Assembly to put forward proposals about devolved government. I think that it will take some time to get to that stage, but unless we have a political forum where the cut and thrust of debate and the influence of one person's views on another person are able to operate there is no way that the problem that has dogged Northern Ireland for so long can be solved.

Will my right hon. Friend try to understand the strong feelings of those who want Northern Ireland to be bound closer to Britain and not put into quarantine with fancy remedies that would perpetuate the sectarian differences of which he has spoken and would tend to undermine the Union? Has my right hon. Friend studied the latest poll, which shows that 88 per cent. of Protestants and 45 per cent. of Roman Catholics would find integration acceptable?

I have studied public opinion polls as closely as every other politician studies them, for one reason or another. I am not arguing with the figures that my hon. Friend has produced. However, in the same poll there are other figures which show that 60 per cent. of Catholics said that full integration with the Republic was acceptable to them and that 60 per cent. of Catholics wished to remain within the United Kingdom with a power-sharing Assembly. I do not think that we should place too much emphasis on the results of that public opinion poll.

I recognise the strong feelings that exist. I am doing nothing which puts the future of Northern Ireland into quarantine. I believe that our proposals are the most likely way to tie Northern Ireland into the United Kingdom. It is the duty of the House to seek to do that.

In the opening sentences of the White Paper, and in his statement this afternoon, the Secretary of State has emphasised the importance of defeating terrorism. In view of the slaughter which has been perpetrated by the IRA over the past eight days, and the likelihood that it will be able to repeat that performance in the autumn, is not the Secretary of State aware that it is the terrorists rather than the political parties in Northern Ireland who are likely to render his efforts meaningless? Whether they like it or not, the Members of the new Assembly will be held responsible by their electorate for security in the Province. What plans, if any, does the Secretary of State have for giving them some say in the overall security policy?

I believe strongly that there will be no total isolation of terrorism until all the parties and all the people of Northern Ireland can strongly and openly support the forces of law and order. That situation is still some way off, but it would be my wish that from the early days of the Assembly it might be possible for closer liaison on security to be developed between the Assembly and the Secretary of State. Although for the time being security and matters of law and order will remain with the House and with the Secretary of State, those are matters which could be transferred when it was thought that the moment was right to do so.

As for security generally, undoubtedly any move towards a devolved Assembly is perhaps too great an opportunity for the IRA to miss, because, if we are successful, that is the way that terrorism will be defeated. We should all remember that in what may be some difficult months ahead.

Does the Secretary of State recall that in a previous White Paper the Government stated plainly that they recognised that there were equally acceptable and satisfactory alternatives to power sharing? Does the Secretary of State still stand by that view, or is he saying, through these weighted majorities, that the views of the people of Northern Ireland are of little account and that whatever kind of devolution they may have it will be power-sharing devolution?

No. As far as possible, I am leaving it to the members of the Assembly to put forward their own views on how a transfer of power should take place. I must make it abundantly clear, since the aim is to create political stability, that political stability will not come unless there is a wide measure of cross-community support. That does not have to be achieved by a power-sharing executive. There are other means by which it can be achieved. It does not alter the fact that unless it has that cross-community support it cannot be stable and cannot work.

Is the Secretary of State aware that my right hon. and hon. Friends give a broad welcome to the White Paper, albeit with guarded optimism? We shall look forward to a full debate on these matters after Easter. Questions arise concerning the mechanics of the way in which the Assembly will operate in practice. We shall seek to deal with some of them in the debate.

Does the Secretary of State agree that, whatever the reluctance of some political leaders and their parties in Northern Ireland to support these proposals, the majority of people there support moves towards filling the vacuum in an evolving devolution, and, indeed, would accept actual power sharing? The proposed Assembly——

Order. I said that questions on this statement would end at 4.20 pm. The hon. Gentleman has asked enough.

I am grateful for the support of the hon. Gentleman and his colleagues. There is some momentum now which could enable the parties in Northern Ireland to come together in an Assembly. I think that, it will require a great deal of patience and understanding to get further than that, but the economic pressures alone now demand that we at least try to get some political stability.

When will the Secretary of State hold a referendum in Northern Ireland on his devolution plans? Does he recall that he voted in favour of the key referendum amendment on the Scottish devolution Bill? If it was right to consult the voters of Scotland and Wales directly on devolution schemes, why is it wrong to give the voters of Northern Ireland the same opportunity?

I know my hon. Friend's strongly held views on this subject; I have discussed them with him. I believe that the Northern Ireland situation is unique, as I think most hon. Members recognise. It would be easy for the parties to evade the issues, and I think that the result of any referendum could be negatived. If it was to have any impact at all, it would have to have an 83 per cent. majority before it could be seen to have a majority of both parts of the community. That would make matters very difficult.

Is the Secretary of State aware that he should be congratulated on his proposals this afternoon, particularly in view of what has been happening behind him and is happening behind the Chair at the present time? The Government have kept their promise by bringing the White Paper before us in these difficult times, for which they should be commended. Is the right hon. Gentleman also aware that a power-sharing executive was last brought down by para-militaries on both sides—those who supported the Ulster Workers Council and those who supported the Provisional IRA? There is a lesson there for the democratic parties to ensure that their voices are heard.

Finally, can the right hon. Gentleman say to what extent there will be a degree of economic initiative lying within the power of the new Assembly?

On the last point, I have nothing to add to what I have already said. However, I would certainly wish to explain to the country, and perhaps to other countries, particularly America, the initiative that the Government are taking, and therefore the need for inward investment in Northern Ireland from America. I emphasise that I wish to see inward investment coming to Northern Ireland.

I believe that we are right, in the interests of Northern Ireland, to bring forward these proposals at the earliest possible moment. I do not think that anything that we say which would be helpful to get American investment in Northern Ireland should be interpreted in the way that the hon. Gentleman sometimes seeks to do.

Will my right hon. Friend re-emphasise that devolved institutions, supported by a majority of the people of Northern Ireland, can serve to strengthen and not weaken the Union?

I am grateful to my hon. Friend for that question, and I believe passionately that that is the case.

Otherwise, there will be continual erosion in Northern Ireland of Northern Ireland's position within the United Kingdom. With a little wisdom, we could put that behind us for ever.

Why is the Secretary of State so nervous of the parliamentary tier? Was it not agreed at the Heads of State meeting? Who has warned him off?

It is a question not of being nervous but of being frank with those who place a great deal of emphasis on the parliamentary tier. My experience of the House suggests that right hon. and hon. Members would be reluctant to give any of their sovereignty to that tier I have had to tell members of the SDLP and the minority community of the difficulties involved in that suggestion. That should be a matter for the House and the Dail to decide.

Does my hon. Friend accept that many of us—and I speak as a colleague and an Ulsterman—will welcome the proposals? Is lie not surprised at the unhappiness expressed when devolution is simply on offer and not imposed on the people of Northern Ireland? Does he agree that the divisions in the Province are likely to be made worse unless a move is made to bring the two communities together?

I am grateful to my hon. Friend for the help and advice that he has given over many months in trying to move forward a step at a time. I hope that some of the resistance from my our own side of the House will be mitigated by the fact that we are moving forward only as and when the people of Northern Ireland are prepared and willing to do so.

Council Of Agriculture Ministers (Meeting)

4.21 pm

With permission, Mr. Speaker, I should like to make a statement on the Council of Agriculture Ministers' meeting in Brussels on 31 March and 1 and 2 April.

The Commission made a compromise proposal on the 1982 price package. After a long and detailed discussion, no agreement was reached. Following pressure from the United Kingdom, I was glad to see included in the package the virtual restoration of the butter subsidy and an improved provision for school milk. There were demands by many member States for higher price increases than those proposed. The United Kingdom opposed further price increases, though Germany and the Netherlands supported us on a number of commodities. We gathered good support for our fierce opposition to the co-responsibility levy on milk with lower rates for small producers, and for our view that we should have freedom as to whether and when there should be any revaluation of the green pound. It was recognised that further consideration was required, and the Council will resume its deliberations in Luxembourg on 20 to 22 April.

In order to allow the Danish Government to continue its policy of having no MCAs, a devaluation of the Danish green krone of 1·8 percentage points was agreed, subject in some cases to reference to capitals.

The current marketing years for milk, beef, sheepmeat and dried fodder were extended until 26 April.

I am grateful to the Minister for the statement, which is less precise than that which we read on page 3 of The Observer yesterday. We have heard the Minister and we regret his failure to come to grips with the need to press for a fundamental reform of the CAP.

In view of the business of the House and, above all, the gravity of the international situation, I shall not press further questions on the Government, so long as we have an undertaking that no final decisions will be agreed before the House has had an opportunity to debate the details. I have given the Minister short warning of my attitude, but we would welcome a rethink. If the Minister gives us an assurance close to that which we require, that would be the best way to deal with the matter.

I am grateful to the hon. Gentleman for his observations. I understand the spirit behind his suggestion. The debate on the price fixing took place only a week ago. I shall continue negotiations on 21 April, so I cannot guarantee that there will be further debate or that there will not be a conclusion on 20 to 22 April. The hon. Gentleman will understand that. He will also understand that nobody has been more forthcoming than I in coming to the House after a meeting in Brussels. I have never missed coming to the House and whenever the Opposition have required a statement, I have made one. I do not know whether there will be agreement on 20 to 22 April. That depends upon agreement on the budget, which depends upon a meeting of Foreign Ministers to agree the budget. If we cannot reach agreement on the CAP, I shall make a statement in the usual way. Alas, I cannot for obvious reasons, give the assurance for which the hon. Gentleman asks.

Does the right hon. Gentleman accept that the timetable of the House has fluctuated—Saturday, for example—that it will fluctuate again and that, therefore we might have the opportunity for discussion earlier than has been envisaged? I must press one or two questions. Has the right hon. Gentleman been pushing the mandate on the principle of closing the gap between the EEC and world grain prices? Has that been abandoned? Is the right hon. Gentleman aware of the leaks that suggest that that gap is at a level of between 10 per cent. and 11 per cent.? What will that mean in terms of the support budget? The suggested figure is 16 per cent. but perhaps a more realistic level is 20 per cent. What will the new proposal of between 10 per cent and 11 per cent. mean?

How do the proposals square with proposals in the Tory manifesto that radical changes are necessary in the CAP and that we—and that means them—should insist on a freeze on products in structural surplus? How does that square with the statement in the middle of February that the United Kingdom urgently needed prudent price increases for products in surplus? Since then prices have been increasing.

Does the Minister agree with the House of Lords Select Committee that the proposals would add £70 million to the United Kingdom budget contribution? How much more will the increase leaked this weekend add to that £70 million? Does the right hon. Gentleman agree that the CAP is incapable of being reformed, that it has failed both the farmer and the consumer and that the best solution is for us to withdraw from the CAP and to develop a policy that will fulfil the needs of the producer and the consumer in this country?

The hon. Gentleman was a Minister in a Government under which the cost of CAP went up by 350 per cent., whereas under this Government it has gone up by only 30 per cent. In those circumstances, I do not accept the hon. Gentleman's criticism. The proportion of the European budget taken up by CAP has substantially reduced, whereas the proportion of CAP expenditure applied to British benefit doubled during this Government's lifetime. Therefore considerable progress has been made.

the detail of the compromise suggestion by the Commission on the price proposals was accompanied not by detailed costing but by the detailed assurance that it would still be within the budgetary limits and below the increase in own resources. We are seeking from the Commission detailed estimates of its proposals.

The hon. Gentleman raised the question of prices and their effect on consumers and statements on page 3 of The Observer and elsewhere. The Commission has moved to a proposal which averages 10·3 per cent. The effect on prices in the United Kingdom will be an increase—if all the price increases take place—of 1·2 per cent. in a full year. When one considers that in the lifetime of the last Labour Government food prices went up by 16·4 per cent. in a year, on average, that is not excessive.

We are interested to assess the cost of the proposals made by the Opposition last week. The hon. Gentleman suggested that there should be deficiency payments fixed between the current European price and the world price.

That would cost £1,000 million a year to the Exchequer and reduce farm incomes by 80 per cent. It would be catastrophic for employment and would cause unemployment in agricultural machinery, the tractor industry and farming, to the detriment of the nation.

I appreciate the Herculean efforts of my right hon. Friend and his colleagues in Brussels to keep these prices as low as possible, but how optimistic is he that a settlement will be reached between 20 and 22 April? Does he realise that the longer this goes on, the greater the detriment it will have on trade and those trying to trade commodities? If, at the end of the day, he must agree to a higher price increase than he would wish, what would his thoughts be on a revaluation?

Obviously to settle a price fixing as near the marketing year date as possible, is an advantage for all the farming community. However, before we make any settlement, it is vital that we recognise the nature of Britain's budgetary contribution. That is why we have always made it clear that the agreement for Britain's future budgetary payments should be connected with and parallel to the price fixing.

Mr. Robert Maclellan
(Caithness and Sutherland)