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Commons Chamber

Volume 23: debated on Monday 10 May 1982

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House Of Commons

Monday 10 May 1982

The House met at half-past Two o'clock


[MR. SPEAKER in the Chair]

Oral Answers To Questions




asked the Minister for Trade if he will give the change in value and volume in exports, and the movement in the visible balance of trade, over the last three years.

In the three years ending 1980, which was the last year for which complete data are available, exports rose by 49 per cent. in value and 8 per cent. in volume. The visible balance of trade moved from a deficit of £2·3 billion to a surplus of £1·2 billion. With permission, I shall circulate the detailed figures in the Official Report.

I am grateful to my hon. and learned Friend for those figures. Does he agree that they are especially encouraging in view of the deep world

Exports and the Visible Balance

Balance of Payments Basis


Visible balance


Percentage increase

Volume Index

Percentage increase

Value increase

£ million

(year on year)

1975 = 100

(year on year)

£ million


Special Steels (Exports)


asked the Minister for Trade what is the value of special steels exported from the United Kingdom to the United States of America in the first quarter of 1982.

This information is not yet available. In the last quarter of 1981 exports to the United States of tool steel, high-speed steel, and stainless steel bars and rods were valued at £1 million fob. Exports of stainless steel sheets, plates and strip were valued at nearly £3 million fob.

What representations have been made by the Government to the United States' Government about the impact of any restrictions on our export of special steels to the United States? Is the Minister aware that

recession? Does he also agree that, with our increased competitiveness in world markets, as measured by recent output per man-hour trends, this augurs well for the future, particularly when the world recession ends and expansion takes place?

I certainly agree that the figures demonstrate the enterprise of British business and emphasise the considerable increase in competitiveness over the past two or three years.

Is the Minister aware that the April report of the CBI predicts that non-oil exports will decline by 4 per cent. this year over the 1979 level, which is after three years of the present Government? The same report predicts an increase in those who are pessmistic about future export prospects. Is not the CBI's evidence a more accurate picture of what is happening to our overseas trade under this Government?

The right hon. Gentleman describes it as a factual position. As he will readily appreciate, those are speculative figures which may well be falsified by events.

Does my hon. and learned Friend agree that we do not make enough of our great success in our export endeavour, which, I believe, is higher per head of the population than almost any other country? Can we not somehow use the lessons of this success to improve our share of trade in the home market?

My hon. Friend is right to emphasise that Great Britain, at least by one test, is one of the most successful exporting nations in the world, whether it be measured by the proportion of the gross domestic product or by the proportion of exports per head of the population. As regards the internal market, I have no doubt that British industry will seek to improve its position, but my hon. Friend will appreciate that trade is a two-way operation.

Following is the information:

although the volume is small, the value is very high and that severe restrictions would have a damaging impact on the BSC?

I am well aware of the importance of our special steels exports, particularly to the private steel making sector, although certain areas are a matter of concern for the British Steel Corporation. As the House will know, there is the possibility of action against exports of steel from the European Community. I can assure the House that the British Government have looked closely, so far as they have been able to do so, at the basis of these cases. Both the Government and the European Commission have made strong representations in Washington about the basis of these possible cases.

Multi-Fibre Arrangement


asked the Minister for Trade if he will report on the state of negotiations on the renewal of the bilateral agreements within the multi-fibre arrangement.

So far, the Commission has held only informal exploratory consultations with the supplying countries. Formal negotiations are scheduled to commence this week in Brussels.

Since any increased access to our markets by smaller supplying countries could be achieved only on the basis of cutbacks from the so-called dominant countries, how does the Minister justify starting negotiations with the dominant countries before he has successfully concluded the position with them to enable him to make concessions to the smaller countries?

The whole House will know that the European Commission has been given a fairly strict mandate to negotiate bilateral agreements under the MFA and with the Mediterranean countries outside the arrangement. We have made it clear that we expect cutbacks of 10 per cent. from the dominant countries, perhaps compensated in certain cases by outward processing. Against that background, I feel sure that it will be possible for the Commission to negotiate satisfactory bilaterals, although we must wait until the autumn to hear the outcome.

Is the Minister aware that some of our partners have been weak sisters in negotiating textile arrangements? Do we have a veto on the negotiations, and if we do will the Government use it if the result of the negotiations is not satisfactory to British textile interests?

It is not for me to comment on the position of individual members of the Community. Each country has a slightly different perception of the interests of its textile industry. However, I have told the House previously that a common Community position was evolved which attracted the support of every member of the EEC. The Commission will have to negotiate within the confines of that position.

I thank my hon. and learned Friend for the concern that he has shown for the textile industry so far. In the run-up to the negotiation of the bilaterals, will he continue to listen to the strong case put to him by the British textile industry and disregard the representations of the British Consumers Association and the German Government?

My hon. Friend's concern for the textile industry, particularly in North-East Lancashire, is well known to the House and I have had the privilege of meeting some of its representatives in his company. I assure him that the Community position has been clearly defined and, although it may not have attracted the universal support of the textile industry, I hope that there is grudging recognition that it could lead to a tougher MFA than the preceding arrangement. It is certainly the Government's intention that that should be the eventual outcome of the negotiations.

Do the Government remain committed to the negotiation of a tough and effective MFA bilateral agreement, as the Minister has claimed in the past, and will the hon. and learned Gentleman confirm that the EEC will withdraw from the MFA if the outcome of the negotiations is unsatisfactory? If so, why does he continually refuse to take immediate steps to prepare an alternative trading policy in case the negotiations fail?

As I have reported to the House, it is the Community's intention to withdraw from the MFA if the bilaterals negotiated under it do not, in total, measure up to the guidelines agreed in Brussels and reported to the House. As regards the possibility of failure, it would be a little premature for the United Kingdom in isolation to devise an alternative regime for textiles. It would be an unnattractive position for the world if the EEC could not remain an adherent signatory of the MFA, and it is wrong to speculate too deeply at present on the consequences of failure. I hope that such speculation will prove to be unnecessary.

Will my hon. and learned Friend bear in mind in the negotiations the interests of the consumer and of poorer countries which are trying to trade with us? The textile industry in this country needs a certain amount of protection, but it is essential for our general trade and for the benefit of our consumers that low-income countries are able to trade with us in low-price textiles.

The Government are very conscious of the consumer interest, and a delicate balance has to be struck in the negotiations between the interests of the textile industry, which is important, of the consumers and, as my hon. Friend points out, of the developing nations. It was thought right in the mandate given to the Commission to cut back on some of the dominant suppliers, who are economically stronger, and perhaps to give a little more leeway to the developing nations.

Will the Minister think again about the answers that he has given to my hon. Friends? A new MFA is of paramount importance to our textile industry. In view of the many thousands who have been made redundant and will never find work again in the industry, will the hon. and learned Gentleman look at the matter again and consider using the veto, if necessary, against any country that tries to foist on us an agreement that will cause further unemployment here?

I reassure the house that the Government are conscious of the 150,000 jobs shed by the United Kingdom textile industry over the past 18 months. I also assure the hon. Gentleman that there is no need for a veto, because the decision of the EEC is that if successful bilaterals cannot be negotiated within the outline of the MFA, which the EEC has signed only on that tentative basis, the Community will withdraw. There is no need for a veto. I merely suggested to the hon. Member for Batley and Morley (Mr. Woolmer) that I preferred not to speculate on the consequences of failure, which would be damaging to consumers and the textile industry of this country.

Manufactures (Balance Of Trade)


asked the Minister for Trade whether he will make a statement on trends in the balance of trade in manufactures with the European Economic Community.


asked the Minister for Trade whether he is satisfied with the existing balance of imports and exports with the European Economic Community.

The balance has fluctuated as our trade with the European Community has expanded. In 1980 the crude deficit fell to £1·8 billion from £3·1 billion the year before. This is not unsatisfactory in view of the large volume of trade involved and the large surplus on the United Kingdom's overall balance of payments.

Since our Community partners, instead of giving us wholehearted support over our problems with the Falklands, have now decided to put us on probation, will my hon. and learned Friend remind them that if they continue to wet their knickers at the first whiff of unvalidated Argentine propaganda, a lot of the trade benefit that they are getting from our membership of the Community will be put at risk?

I do not think that it is necessary for me to comment on the sartorial position of the Community. My hon. Friend is showing too much concern. It was not intended that any decision should be taken on the extension of sanctions at the weekend meeting near Liege. The Government hope and expect that the EEC's common position on sanctions will be extended. My hon. Friend is right to point out that the United Kingdom market is important to the Continental European members of the Community, just as the European Continental market is important to our exporters.

Will my hon. and learned Friend confirm that in the second part of last year we showed a specific increase in our manufactured exports to the EEC, which I am sure the whole House welcomes, and that to the extent that our manufacturing performance may still be less than we wish it is because of poor productivity in many of our manufacturing areas, which would only worsen our position in the unlikely event of our coming out of the Common Market?

My hon. Friend is right to draw attention to the fact that the EEC is Britain's fastest growing export market. If I may inflict a statistic on the House, 39 per cent. of our exports of manufactures in 1980 went to the Continental European countries of the Community, campared with 29 per cent. in 1972. Echoing the point made by my hon. Friend, there is certainly scope for a further increase in British exports to the EEC and my Department has recently had an "Export to Europe" drive, which I hope will yield good results in the years to come.

Does the hon. and learned Gentleman's Department keep separate trade statistics for Great Britain as opposed to the United Kingdom? If not, will he kindly apply the proper description to this country?

The answer to the right hon. Gentleman's first question is "No". We shall certainly see if we can be more exact in our use of nomenclature.

Does my hon. and learned Friend agree that my hon. Friend the Member for Northampton, North (Mr. Marlow), when he has finished providing The Sun with headlines, might reflect on the fact that this country requires markets for its exports and that it is for those who are constantly asserting the damage that results from our membership of the European Community to explain how a free trade area would resolve any of the problems that we face in our trade with the EEC or how, by sheltering behind a tariff wall, we could possibly find an outlet for our export industries?

My hon. Friend is absolutely right to draw attention to the perils of protectionism, particularly if protectionism were applied by this country to the other countries of the European Community. I have emphasised that our fastest growing and, indeed, our largest, export market is Germany. One can reflect long and hard on the disadvantages to this country if we were on the outside of a free trade area of those dimensions.

The hon. and learned Gentleman will be aware of statements by Ministers representing other countries in the European Community to the effect that there should be a linking between the Community support for Britain over the Falkland Islands and other issues within the Community. Does he agree that it is wrong for such a linking to be made? Surely the Economic Community is supporting the United Kingdom because its stand is correct in terms of international law. Will the hon. and learned Gentleman undertake that there will be no linking of any kind with the basis of support that we receive from the Community?

The right hon. Gentleman cannot have heard the contribution of the French Foreign Minister on "World at One" today when he demonstrated clearly that France sought no such linkage and gave us unstinted support in our defence of an important principle in the South Atlantic.

British Airways


asked the Minister for Trade when he expects to receive the annual report of British Airways on its accounts for the year ended 31 March 1982.

Have not British Airways' subsidiary companies contributed £20 million profit a year to British Airways as well as an important cash flow throughout the financial year? As these are well-run and profitable nationalised concerns, will the Minister confirm a report in The Guardian on 29 April that there is no intention to sell off profitable subsidiaries such as British Airways Helicopters and International Air Radio?

No, Sir. I shall not confirm any report in The Guardian newspaper. I shall, however, tell the hon. Gentleman that if the board of British Airways decides that it wants to sell off the subsidiaries, that is its decision and we shall not stand in its way.

In expressing my full confidence in the chairman of British Airways, may I ask what discussions my hon. Friend has had with him about deregulating air fares between this country and Europe? It now costs more in terms of seat pence per mile to fly economy to any capital city of Europe than to fly Concorde across the Atlantic.

I have had extensive discussions with Sir John King and other members of British Airways about the position in Western Europe. I assure my hon. Friend that it remains the policy of Her Majesty's Government to introduce much greater liberalisation into the European regime.

Have the Minister's discussions with the chairman included any examination of the position whereby first-class, senior officials of British Airways are now being made redundant? Is he taking any steps to make sure that their expertise is not lost to an important sector of industry?

That is mainly a matter for the board of British Airways. I am certain that the hon. Gentleman's point will be well taken by the board.

Is my hon. Friend aware that the accounts of British Airways would be greatly improved and the service to the travelling public greatly enhanced if such activities as retail shops, building maintenance, aircraft cleaning and, above all, catering, were hived off to private enterprise—none of these services is at the moment profitable—leaving British Airways to conduct its proper business of running aircraft.

My hon. Friend makes an extremely interesting point which will be noted, I am sure, by the board of British Airways. Among the main objectives of Sir John King and his board are restoring British Airways to profit and giving a better service to the travelling public.

Will the Minister recognise that most airlines are going through difficult times? Will he ensure that no Government pressure is applied on British Airways to break up and sell off various parts of the airline? Does he realise that we have already lost Laker Airways and that other airlines may go bankrupt if British Airways are not maintained?

I assure the hon. Gentleman and the House that there will be no improper pressure from the Government for British Airways to sell off subsidiaries. But, if that is the decision of the British Airways board, we shall not stand in its way. It is our wish to see British Airways profitable as soon as possible and privatised as soon as possible.

Will my hon. Friend assure the House that the Government will do nothing by their policies to impede progress by British Airways towards the profitability that we all seek? In this regard, will my hon. Friend facilitate the concentration of British Airways scheduled services at Heathrow airport, enabling them, especially, to transfer from Gatwick to Heathrow their scheduled services to the Iberian peninsula?

In regard to the latter part of my hon. Friend's question, I cannot give him any such assurance at this time. As he knows, complicated and intricate discussions are taking place. On the first part of his question, my hon. Friend can be certain that no Government in the history of this country will do less than this one will to stand in the way of British Airways returning to profitability.

What did the Minister mean by saying that no "improper" pressure will be brought to bear on British Airways? Will he bring any pressure to bear on British Airways to sell off subsidiaries? Will he say whether the Price Waterhouse report proposed a major reconstruction of British Airways, whether it considered the possible injection of £600 million into British Airways and whether it considered the possible sale of subsidiaries? Is it not disgraceful that a British nationalised industry should be treated in such a cavalier fashion by the Minister, who will not even publish a major report of significance to a national institution?

On the first part of the hon. Gentleman's question, I plead guilty to tautology in talking about improper pressure. No pressure that I brought to bear would ever be improper. I need to bring no pressure on British Airways to restore itself to profitability. Sir John King has the airline on the right lines towards exactly that end.

The Price Waterhouse report was commissioned by British Airways. It is for British Airways to decide whether they want to publish the report. British Airways have decided that they do not want to publish it. I shall not quarrel with that decision.

Trade Statistics


asked the Minister for Trade to what factors he attributes the state of the latest trade figures.

Export and import levels at the turn of the year were far higher than those reached in early 1981. This reflects the recovery in economic activity and the achievements of our exporters.

Does my hon. and learned Friend agree that during the long, hard struggle of recent years, especially in regard to high levels of unemployment, many people have tended to overlook the great successes that we have enjoyed, particularly in trade? Does he agree that there are good prospects of improving still further on our current position from the firmer base that we now enjoy?

The whole House, I am sure, agrees with my hon. Friend that the performance of British exporters has been notably successful in the last three years and that businesses, as a result, have maintained a higher level of employment. The House will have noticed the relish with which the Opposition Front Bench suggest that our export performance over the years to come might not be so successful, presumably because they are deeply conscious of the export figures achieved under the previous Administration.

Will my hon. and learned Friend accept that it will be difficult to improve upon our latest trade figures with Spain in motors cars and components, because of the adverse differential tariffs raised by the Spanish Government which prevent our exporters from achieving their full potential there? Will he look into a matter that has dragged on for far too long while it was hoped that Spain would one day accede to the Community? Action appears to be continually postponed.

We do not look forward to an indefinite postponement of Spain's accession to the European Community. One of the benefits to the United Kingdom of Spain's accession will be the full opening up of the Spanish internal market.

Falkland Islands


asked the Minister for Trade what his Department is doing to ensure the long-term future of Anglo-Argentine trade after a successful outcome of the present situation in the Falkland Islands has been achieved; and if he will make a statement.

Action to promote the future development of Anglo-Argentine trade must await the settlement of the present conflict.

The Minister will be aware that major British trade and investment interests are at stake. May we have an assurance that when the diplomatic and military aspects of the problem have been settled steps will be taken to safeguard our legitimate and substantial commercial interests, which may have been put at risk?

Neither I nor any Government spokesmen have concealed the fact that the present conflict cannot be costless. However, I intend to take every opportunity to secure a resumption of trade when relations are put on a normal and satisfactory footing.

I must emphasise that the solution of this present unhappy conflict is prevented by the intransigence of the Argentine Government, not of her Majesty's Government.

Will the Minister confirm that the last British Minister to visit the Argentine to promote British exports was the right hon. Member for Hertfordshire, South (Mr. Parkinson), who is now a member of the War Cabinet?

I am not entirely certain, but I think that the hon. Gentleman may be wrong. It may have been my right hon. Friend the Minister of Agriculture, Fisheries and Food. The conclusions to be drawn are matters for speculation.

Textile And Clothing Imports


asked the Minister for Trade what progress has been made on the negotiations regarding textiles and clothing imports from the preferential countries.

Voluntary restraint arrangements have now been concluded with Egypt and Spain, and negotiations are continuing with the other preferential suppliers.

Does the Minister recognise that the quotas for trousers and jeans are consistently the most fully utilised and that, under MFA3, they will suffer from the higher growth rate of group 1 imports? Will the Minister ensure that pressure from some Mediterranean preferential countries for substantially increased quotas for trouser and jeans are decisively rejected?

I cannot ensure that they will be decisively rejected. I assure the hon. Gentleman that whatever bilateral arrangements are concluded with the Mediterranean suppliers should be reconciled with those concluded with MFA participants and should be firmly comprised within the overall limits that have been set by the Council of Ministers of the European Community.

Will my hon. and learned Friend help the understanding of the House in this matter by commenting on the fact that, during the period of MFA2, whereas imports of clothing and textiles from developed countries have grown exceedingly, limits have been placed on the so-called developing countries and other less benefited suppliers? If so, would it not be more sensible either to impose overall control, if that is thought necessary, or to free a greater area of trade for competition than to seek continually to benefit the developed countries?

As my hon. Friend will appreciate, the underlying principle of the MFA is to provide a period of readjustment for the textile industries of the developed world, particularly the United Kingdom, to adjust to competition from low-cost countries. That is the theme of the MFA, and it is a theme that has commanded the respect of the House over the years.

Bearing in mind the difficulty of ensuring restraint on imports, if no voluntary arrangements are reached with Portugal, Tunisia and Morocco, and those countries are informed by the EEC of the import levels that will be applied by the European Community, how will those levels be enforced?

They will be enforced by the individual Governments of the member countries and the United Kingdom, in conformity with the levels that will be agreed through the Council of Ministers and notified to member countries by the European Commission.

British Airways


asked the Minister for Trade if he expects British Airways to make a profit in the current financial year.

I expect British Airways to make a big improvement in their financial performance this year over the two previous years. I hope that they will make a profit.

With the reconstruction of British Airways into three operating divisions, will the Minister give an absolute assurance that no division will be sold off until the three individual divisions are all profitable?

I thought that I should be able to agree easily to that question by saying that it is not the present intention of Sir John King to sell off any of those three divisions piecemeal, but it is not dependent on when those individual profit centres become profitable. Privatisation of British Airways will go ahead as fast as possible in overall profit.

Does my hon. Friend agree that British Airways are unlikely to make a profit if they are plagued by idiotic strikes, such as that by the baggage handlers, and by practices such as flying empty aircraft from Belfast to Glasgow every evening? Would it not be better to take the example of the Scottish division, which shows the way forward to making a profit?

I am grateful to my hon. Friend for drawing to the attention of the House the satisfactory conclusion that has been reached in Scotland, where a predicted £6 million deficit has been turned into a predicted £1½ million profit. I hope that British Airways as a whole may benefit from that.

The Minister will be aware that there have been repeated press reports that the Government may write off £600 million of British Airways indebtedness to facilitate the floating of shares on the private market. Will he give a clear undertaking to the House that the Government will contemplate no such thing, which would be a gross fraud on the British taxpayer.

The right hon. Gentleman is always inviting me to comment on either press reports or hypotheses. That is a profitless hypothesis. I suggest that the right hon. Gentleman waits to see what happens. Privatisation cannot come soon enough for me, and I hope that the same is true for him.


asked the Minister for Trade whether it is still his intention to sell shares in British Airways.

Does my hon. Friend realise that that is welcome news to a large number of my constituents who work for British Airways and who would much rather work for a private concern than for a nationalised one? Do I understand that previous exchanges across the Floor of the House mean that reorganisation within British Airways, which has been touched on, will not of itself hold up the Minister's medium and long-term intentions?

The formation of a number of new profit centres will enable the British Airways management to obtain a far tighter grip on British Airways, thus enabling an even quicker return to profitability. I thank my hon. Friend for his remarks in support of the Government's policy of privatising British Airways. It is our intention to make British Airways into a profitable private sector company that can be looked on with pride by its staff and shareholders and by members of the public.

My hon. Friend, the chairman of British Airways, Sir John King, the board of British Airways and its staff should be congratulated on making what is a long overdue change to bring back continental and inter-continental departments in the routes that British Airways operate. It was a mistake in the past when BOAC and BEA were joined. Does my hon. Friend agree that British Airways should now be on a glide path to profitability? Will he help them in any way that he can so that they can re-equip with Boeing 757s and 767s as soon as possible?

I shall certainly do everything that I can to encourage British Airways to get back to profit as soon as possible. I welcome my hon. Friend's suport for the measures that Sir John King has recently taken to get a tight grip on the management and future profitability of British Airways. I especially welcome it coming from a former member of the old corporation.

Will the Minister make it crystal clear that there can be no question of the Government writing off British Airways' debt liabilities to facilitate the sale of shares? Will that option be in no way considered?

I do not know how often I must answer these questions from the right hon. Gentleman.

The right hon. Gentleman must wait for details of the privatisation of British Airways. When the time comes, he will see what we hope to do, and we hope to have his support.

I welcome the Government's policy of privatisation, but will not prospective shareholders wish to know whether the craven refusal of British Airways's crews to stay overnight in Northern Ireland, which has cost thousands of pounds, has ended?

Investors will wish to know that nearer the time. They will be told nearer the time. The exact details of the Belfast flights are a matter for the board of British Airways.

Laker Airways


asked the Minister for Trade what assessment has now been made of the total moneys owing to the creditors of Laker Airways at the time of its collapse.


asked the Minister for Trade what assessment he has now made of the total sums owed to creditors of Laker Airways.

I am informed that total liabilities are estimated at £260 million.

Just under 17,000 people held scheduled tickets on Skytrain with a total value estimated at £3·85 million. Some of them were able to use their return coupons with other airlines. How many remain with unused coupons is not yet known.

A further 139,000 people had paid in part or in full for a package holiday. Total liabilities are about £6 million, which can be met in full out of bonding arrangements and the air travel reserve fund.

In view of the fact that Ministers had drawn to their attention the shortcomings in the financial arrangements of Laker Airways before Christmas, that they decided to take no action, and that advertising by Laker continued after that time without any proper or improper pressure from Ministers to bring it to an end, will the Minister tell us what proportion of those massive liabilities the Government intend to bear, and will individual Ministers be held personally responsible?

The answer to the latter part of the question is "Certainly not". The hon. Gentleman has not thought through the implications of his question, or he would not have asked it in that form.

With the wisdom of hindsight, I believe that the Civil Aviation Authority used its powers sensibly. It would not have been right for that body to have stepped in earlier, because a hasty or premature intervention at that time could have brought matters to the very head to which they eventually came. The Government have no funds available for reimbursing the ticket holders.

Is it not clear that the sums owed by Laker Airways to travellers and to commercial concerns is much more than was admitted at the time of the company's collapse? Is the Minister really saying that he is satisfied that the Civil Aviation Authority effectively supervised the affairs of Laker Airways? Should not the whole matter be investigated and made public?

The Government considered carefully whether they should appoint an inspector under section 165 of the Companies Act 1948. However, the CAA, the Bank of England and the receivers advised that they were not aware of anything that would fall within the provisions of that section. I do not believe that the collapse of a major airline, such as Laker, can of itself justify an inquiry of the sort suggested by the hon. Gentleman.

In dealing with the sad collapse of Laker Airways, what immediate steps did the Government take to ensure that the routes operated by Laker were transferred to British companies? Could not the use of some of Laker's equipment have realised large sums of money for the creditors and been of considerable use to the British aviation industry in ensuring that those routes did not fall into the hands of overseas airlines?

I am glad that my hon. Friend has raised that matter. Great credit goes to other airlines for the way in which they assisted stranded passengers. The Los Angeles route has been taken over temporarily by British Caledonian. We are sympathetic to the position of those who hold scheduled air tickets which are not covered by the bonding and air travel reserve fund. As my hon. Friend will know, on 1 March the Government set up a review to consider any future provisions that might be made. We hope to have its report in June.

Does the Minister believe that Laker Airways was a good example of a private enterprise flying company? What assurance do we have that British Airways will not go the same way? Does the Prime Minister still believe that she is a Freddie Laker man?

As the hon. Gentleman knows, we have great confidence in our private enterprises. The hon. Gentleman has no right to cast reflections on other private enterprises simply because one airline runs into economic difficulties.

Does my hon. Friend agree that very few major airlines make profits and that, if precipitate action were taken, few of those airlines, including British Airways, would be flying the North Atlantic?

My hon. Friend knows that the number of airlines not making profits is not as large as he suggests. Some companies make profits. That emphasises what my hon. Friend the Under-Secretary of State said about ensuring that our airlines make profits as soon as possible.

Is the Minister aware that, bit by bit, more information is corning out about the way in which the affairs of Laker Airways were handled by the Government and the CAA in the months before the collapse? In view of the staggering figure of £260 million, which has been confirmed by the Minister today, is it not clear that there should be a full inquiry—judicial or otherwise—into the CAA's handling of the Laker affair and the handling of it by complacent Ministers at the Department of Trade?

The right hon. Gentleman is trying very hard to make political points with the wisdom of hindsight. I wonder whether he would have had the same attitude some months ago when none of those matters were known. We must await the receiver's full report.

On a point of order, Mr. Speaker. In view of the unsatisfactory nature of the Minister's answer, I shall take the earliest opportunity to try to raise this matter on the Adjournment.



asked the Minister for Trade whether he will make a statement about the efficacy of the operation of trade sanctions against Argentina.

While the efficacy of sanctions can never be precisely measured, it is already clear that the measures adopted by the European Community and others have put considerable pressure on the Argentine economy and undermined international confidence in it.

Will the Minister order an inquiry into how the merchant bankers Schroder Wagg secretly transferred their entire Argentine loan book from London to Zurich on the day before the Argentine invasion of the Falkland Islands? In view of the fact that a complete economic boycott would be far more effective than military action, why are the Government not bringing pressure to bear on unpatriotic, greedy, British bankers who are using their overseas subsidiaries to prop up the Argentine junta, or do the Tory Goverment prefer to send young men to their deaths than to offend their friends in the City?

The hon. Gentleman speaks from a position of invincible prejudice. Even assuming that the facts outlined by him relating to a well-known City merchant bank are true, they obviously occurred before any measures were introduced by the Government.

The Argentine Government have complained, within the terms of the GATT, about the effctiveness of the measures and the damage that they are likely to do to the Argentine economy in the long run. That suggests that the measures have been well designed and are achieving their objective.

Has my hon. and learned Friend any assessment of the value of trade that has taken place between the Soviet Union and Argentina since the commencement of hostilities?

No. We would welcome any information that my hon. Friend can give on that matter.

Overseas Development

European Development Fund


asked the Secretary of State for Foreign and Commonwealth Affairs if he is satified with the developmental quality of schemes initiated by the European development fund.

Not entirely. We have long been concerned about the design and implementation of the programmes of the European development fund. Partly owing to our efforts, their quality has improved in recent years. We shall continue to work to secure further improvements.

I am grateful to the Minister for his frank reply. Will he now look at some of the criticisms of the fund that have been made in the House? In particular, will he investigate why development investment in overseas territories enjoys the same criteria as that of the European Investment Bank inside Western Europe? Is that not an anomaly that should be looked at?

What percentage of the total European budget accounts for the European development fund? What efforts will he make to achieve a greater coordination of effort between the various member States of the European Community in their approach to overseas aid and development?

We constantly try to get better co-ordination at the Council of Ministers' meetings. I regret that I cannot give the hon. Gentleman the exact figures off-the-cuff.

Will my right hon. Friend place in the Library an exact definition of the words in the question "developmental quality"?

Jamaica (Agricultural Products)


asked the Secretary of State for Foreign and Commonwealth Affairs what assistance is currently being given to Jamaica to improve the production and marketing of agricultural products.

The Commonwealth Development Corporation is involved in development projects in forestry, coffee, the dairy industry and the flour milling industry. We are providing experts under the British technical co-operation programme for the Forestry Department and the Forest Industries Development Company.

The Tropical Products Institute gives advice to both Government and non-Government agencies in Jamaica on many aspects of production and marketing.

That is a welcome and constructive reply. Is any particular help given to the Jamaican banana industry, which in recent years seems to have fallen far short of the quota that it could use in the European market?

Throughout the Caribbean the banana industry is in considerable trouble. One of my senior officials was in Jamaica last week. If the Jamaican Government want any help, I am sure that they will have put that request to my official and I shall hear about it this week.

Does my right hon. Friend agree that one of the major problems that Jamaica faces in marketing its products is the lack of managerial and administrative muscle? The principal cause of that is the lamentably low literacy rate on the island. Will my right hon. Friend consider assisting Jamaica by helping it to make primary schooling mandatory?

Mandatory primary schooling must be a matter for the Jamaican Government.

Will the Minister's decision to close an important sector of his Department dealing with land tenure and agricultural production and distribution, reducing the number of employees from 90 to 40, have any effect on the Government's assistance to Jamaica?

Aid Programme


asked the Secretary of State for Foreign and Commonwealth affairs what proportion of the United Kingdom's aid programme is devoted to supporting preventive health measures.

We attach considerable importance to preventive health measures. Apart from specific health aid, we engage in agricultural, educational and engineering projects which help to promote good health, and in particular we are increasing our expenditure on water supply projects. I estimate that 8 to 10 per cent. of the total aid programme is spent on health, but it is not possible to say what proportion of this is for preventive measures.

Is there not an inconsistency between the fact that we are providing money to improve the health and well-being of people in the developing world and the fact that British tobacco companies are exporting their products to those countries under terms that are no longer acceptable in Britain? Are we not being hypocrites? Should not the Government seek to enforce the standard applying to British tobacco companies in Britain to their exports to those countries?

Developing countries must set their own standards. It is not for us to set standards for them.

Will my right hon. Friend confirm that one of the most effective and cheapest ways of ensuring an improvement in the standard of health of mothers and young children in developing countries is to ensure the proper availability of family planning services? Will my right hon. Friend also confirm that in future aid programmes that are approved by him he will try to ensure that proper precedence is given to population policy considerations?

I agree with my hon. Friend. About two years ago I gave an instruction that the question of population should be looked at in relation to every project that was being considered.

Is there not a lack of liaison between the ODA and our multinational companies in the marketing of goods which might be prejudicial to the health of people in the developing world? Surely we do not want our aid efforts undermined by marketing practices which, with a little good will on both sides, could be prevented in the first place.

I agree with the hon. Gentleman. This is primarily done by the World Health Organisation, on which we are represented.

Is my right hon. Friend aware that there has been a serious outbreak of malaria in Sri Lanka in the past few months? Can he give the House any facts or figures on that and say what preventive steps he can take to help?

No, I cannot. If the Sri Lanka Government bring it to our attention and ask for help, we shall certainly consider what we can do.

The Minister will be aware that grave concern was expressed last week at the World Health Organisation conference in Geneva regarding the high price and efficacy of drugs in Third world countries. Is it not high time that the Government set up an investigation into the dubious practices of some pharmaceutical companies?

I was not aware of what happened at the World Health Organisation conference, because I was in the Caribbean. However, I shall certainly consider the hon. Gentleman's suggestion.

European Development Fund


asked the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the discussions he has had with M. Pisani about the administration of the European development fund.

In my discussions with M. Pisani on 16 March I was glad to find that he fully shares our concern that improvements in the European development fund should be made wherever necessary to ensure that aid funds are used to the best effect.

Does the Minister agree that there is a long way to go in the light of the criticisms made by the Court of Auditors and by other bodies about the inefficiency of this scheme, its high administrative cost and the inappropriateness of much of the aid that is given? Will the Minister advise the House whether it is possible for the Government to transfer funds which they are currently making available to the European development fund to the Commonwealth fund for technical cooperation, which is efficiently run, cheaply administered and highly effective?

I take note of the first part of the hon. Gentleman's question.

We are committed to our contribution to the European development fund for a specific number of years. We do not want to increase our contribution at the next round of talks on the EDF, because we are not happy with multilateral aid. We prefer bilateral aid.

Does the Department monitor the contracts that are awarded country by country within the Community to ensure that there is an equitable distribution of orders among companies? If not, would it not be a good idea to do so?

Yes, Sir. We keep an eye on the percentage of contracts awarded to British companies. It is primarily a matter of United Kingdom businesses getting orders. They used not to do that, but they are getting better at it. With help from our embassy, we hope to improve matters for Britain.

Falkland Islands

I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a matter of definite and urgent public importance, namely

"the need for Foreign Office Ministers to clarify the attitude of our European partners towards the Falkland Islands crisis."
It is exactly 20 years to the day since I was first elected to the House and this is the first occasion—

Order. I remind the hon. Gentleman that the matter that he wishes to raise was known before 12 o'clock midday. Therefore, he should have given me notice that he would seek leave to move the Adjournment of the House.

I was about to say that it was the first time in 20 years that I had not given you notice—

Order. I fear that this is the first time in 20 years that the hon. Gentleman has been out of order. The House and the hon. Gentleman knew about this issue before 12 o'clock, and I cannot allow him to pursue his application.

Certain events have taken place since 12 o'clock. I refer to the broadcast by the Foreign Minister of France, M. Cheysson, on Radio 4, which throws into question the amount of support that we can expect from our European partners. The matter is important, not least because every ministerial statement, broadcast and television appearance mentions the importance of international support, yet that is in grave danger—

Order. I have listened to the hon. Gentleman. If he has new information that has emerged since 12 o'clock midday that might have a serious effect, he is justified in seeking the leave of the House to move the Adjournment under Standing Order No. 9, but he must make out the case for urgency, and so on.

The case for urgency is that our European partners may question the legality of the whole Falkland Islands operation. They are mystified and obfuscated about whether we are at war. Only recently, after 12 o'clock—

Order. I am sure that the hon. Gentleman will not seek to make the speech that he would make if I were to allow his application. I hope that he will tell us about the new information that was not available before 12 o'clock midday.

Order. I am afraid that I disagree with the hon. Gentleman and believe that he could have given me notice of the matter that he wishes to raise. I am sorry, but I do not propose to allow him to continue.

On a point of order, Mr. Speaker. Unlike my hon. Friend the Member for West Lothian (Mr. Dalyell), I do not intend to seek to move the Adjournment of the House. Has the Foreign Secretary made any application to make a statement? Since the House met on Friday there have been many important developments of which hon. Members on both sides of the House should have been informed. I refer not only—

Order. The answer is that I have not received any application to make a statement to the House. If I had received an application, there would have been a statement.

On a genuine point of order, Mr. Speaker. The Foreign Minister of France, one of our major partners, has made a broadcast since 12 o'clock, which we could not have anticipated—

Order. I have already given a ruling on that point and I must stand by it. Like everyone else, I listened to the news at 1 o'clock but heard nothing that I could not have been told before 12 o'clock midday.

Orders Of The Day

Northern Ireland Bill

Order for Second Reading read.

3.35 pm

I have it in command from the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Northern Ireland Bill, has consented to place her Prerogative and interest, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.

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

I have selected the amendment in the name of the right hon. Member for Brighton, Pavilion (Mr. Amery) and others.

The White Paper debate of about two weeks ago could not have left anyone in any doubt that the search for an acceptable Government in Northern Ireland is difficult and contentious. I shall devote a good deal of my speech to seeking to deal with a number of the objections that have been raised in principle to the Bill. More detailed points can be dealt with by my hon. Friend the Minister at the end of the debate and in Committee.

I recognise the sincerity with which my hon. Friends hold their views. I am very sorry to see my hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen) sitting on the Back Benches. As he knows, I have a high personal regard for him and I should much prefer to see him still sitting on the Front Bench. I say both to him and to those of my right hon. and hon. Friends who hold a different view that it is not within the capacity of any of us to be certain that the policy that we follow is right. Many solutions have been canvassed. Some have been tried and some have, regrettably, failed. A policy of continuing with direct rule does not offer a long-term answer. We either move to a position of total integration—the view of some of my right hon. and hon. Friends who have tabled the amendment—or we seek a gradual devolution of power, which is the course that the Government believe should be followed.

As I said in the White Paper debate, direct rule is most people's second-best option. It could not prevent the upsurge in violence brought on by the hunger strike or the events of last autumn. Despite the most intense and dedicated efforts by the security forces, violence continues and tensions between the communities are quickly roused. What has given me much hope is that, despite all the provocations of last year, when it came to the crunch the vast majority on both sides of the community demonstrated once again their rejection of violence. This gives confidence to seek to make change now.

I turn to my views on why I do not believe full integration is acceptable. It is not what any of the parties want or are committed to. They may not like the Government's proposals, but they would like full integration even less. I must tell the House that a return of power to local government—either to district councils or the creation of a new tier—would be bitterly opposed and offers no easier way out of the difficulties. This course—that is integration and a local government structure—would deny the minority any proper opportunity of expressing their aspirations or assuming their share of responsibility. Direct rule is tolerated because it is regarded as a temporary arrangement. Full integration is an irrevocable step that would lead to great alienation and instability. Whatever labels one allocates to the people of Northern Ireland—and the vast majority wish to retain their connection with the United Kingdom—it will be possible only if we take fully into account the manner by which parts of the community identify with different policies and aspirations. Integration would simply not allow that to happen, and that is why a form of devolved Government is so necessary.

Of all the criticisms of the Bill that have been made, the one that is most unacceptable is that we should not proceed because of the Falkland Islands crisis. It is said that political controversy is undesirable at times when Service men are at risk. We all agree to that. Many of those who say "Wait for another time" are those who wish us not to proceed at all. They realise, as I do, that to postpone now is for all practical purposes to kill off these proposals. It is perhaps salutary to remember that the same armed forces that now engage our attention in the Falkland Islands have, together with the RUC, suffered over 630 deaths since 1971. Northern Ireland has left the front pages, but the suffering continues. The Government do not share the view that it should be put on the back burner. Its problems are just as poignant and deserving of the attention of the House today as they have ever been.

My right and hon. Friends in their amendment say that the Bill will do nothing to achieve the defeat of terrorism or revive the economy of the Province. Of course the introduction of an Assembly will not directly and immediately achieve either objective. It would be naive to suppose that it could. But that does not apply if we lift our eyes to a longer time span. Few will doubt that political stability would have a beneficial effect upon investment and therefore employment in the Province, and this is an essential element in economic revival. Simarly, few would doubt that the willingness of all parts of the community to associate with the institutions of law and order would, in time, improve the supply of information and strengthen active and positive resistance to terrorism.

The Assembly is a necessary preliminary to political stability. The Bill does not deliver a better economy or better security, but without it we cannot proceed to later stages. Much patience and further negotiations will follow, and it will take time, but without the Assembly we cannot set out along this road. Of course, that makes for a different approach from that to the rest of the United Kingdom and as such raises constitutional issues and fears, but I ask the House most earnestly to consider the following proposition.

Let us suppose that, for whatever reason, a sufficient measure of agreement were struck between the parties in Northern Ireland so that they were prepared to work together within an acceptable constitutional structure. Is there really any hon. Member here who would turn down that benefit simply to avoid restoring a constitutional anomaly which Northern Ireland enjoyed for 50 years? Are we really saying that the admitted difficulties that arise from devolution and the so-called West Lothian question are not a price worth paying for a degree of political cooperation and harmony in Northern Ireland?

Is the constitutional structure of the United Kingdom so pure that we are not prepared to pay that price? Hon. Members cannot evade this point. The Bill provides very clearly that devolution is not delivered until the agreement is reached. There is no blank cheque here. The parties must demonstrate their co-operation to the satisfaction of the House before devolution is given. The parties must honour that agreement or devolution is unwound. I can conceive of no better bargain, either for the House of for the United Kingdom.

In no curmudgeonly spirit, let alone a spirit of spite or may I ask the Secretary of State how he resolves the so-called West Lothian question?

That is a matter that the House will need to consider when the time is ripe, which is still a good way off. If the time comes earlier, with devolution completed, that will be the right time for the House to consider the matter. However, we are a considerable way off that point.

This is my last intervention. Is not that part of the trouble? In the Bills on Scotland and Wales, by a long process of self-education the House of Commons discovered that there was no answer to the so-called West Lothian question. Had there been an answer, it would have been found by able Ministers such as my right hon. Friend the Member for Lanarkshire, North (Mr. Smith) and others, and by all the clever civil servants, such as Sir John Garlick and others, who set their minds to the question. If they could not find the answer at that time, how can anyone find it now?

I repeat that the prize that we gain by a stable situation in Northern Ireland is worth a great deal of the difficulties, which I have admitted are there, in any arrangement that could allow hon. Members to vote on matters for which they have no responsibility in Northern Ireland or elsewhere in the United Kingdom. That matter was dealt with satisfactorily when Stormont was in operation. The situation would be no different in the future from what it was at that time.

My right hon. Friend said that the situation would be no different. It was part of the convention regulating Stormont that Ulster was under-represented because it would not interfere unduly in the affairs of the United Kingdom. Now that we have decided, rightly, to increase the representation of Ulster to the full extent that it deserves, surely my right hon. Friend's argument no longer applies.

I can only tell the House what Mr. Airey Neave said during the passage of the Bill that created the 17 Members. He said that, regardless of any measures that might give greater devolution to Northern Ireland, the election of 17 Members from Northern Ireland was justified in its own right. That is the position that the Conservative Opposition stood by at the time and one that I expect Conservative Members to stand by in future. In any event, that would be a matter for the House to reach a judgment on at a later stage. It is probably the best way to proceed if hon. Members are not prepared to accept the arguments that I have used in reply to the hon. Member for West Lothian (Mr. Dalyell).

Does my right hon. Friend agree that if Westminster had had general supervisory powers over Stormont, and if Stormont had been in the nature of a large local government and not a devolved Government, perhaps our supervisory powers would have prevented the Catholic minority from losing confidence in Stormont?

I do not believe that the manner in which Stormont was set up would have allowed that to happen. The fact that we shall now have those supervisory powers over whether we grant devolution to Northern Ireland, so we have to make up our minds whether there is cross-community support, is the guarantee that the House should require.

I shall not give way. I want to move on.

I accept that this is an important matter. I hope that hon. Members will not think that although we believe that the measure will help to provide stability in Northern Ireland—although it runs against other views that we hold on the constitution—we are not prepared to consider what we had for 50 years and what most people recognise as being the best way forward.

I am grateful to the right hon. Gentleman for giving way. I am sorry if, by rising, I have deprived any other hon. Member of the opportunity to intervene in the right hon. Gentleman's speech. I hope that I have not. What the right hon. Gentleman has said has not left clear—I hope that he can make it clear—the commitment of the Government this year, when the right hon. Gentleman receives the report of the Boundary Commission for Northern Ireland, to proceed under the statute to the provision of 17 seats for Northern Ireland, irrespective of what happens under or to the Bill.

Of course I have made it clear. It has never been in doubt. There will be 17 seats for Northern Ireland. The only point that I have made is that at a much later date after devolution it will be for the House to consider whether 17 is right. As things stand, the 17 seats issue is a non-issue for the House. We proceed as we are doing. If there is doubt about the matter, I am grateful to the right hon. Gentleman for the opportunity to put it right It is a canard put up by Unionists from time to time to create ambiguity about Government's proposals. There never has been ambiguity on that matter.

The general philosophy of our approach was set out in the White Paper and debated less than a fortnight ago. But the translation of the White Paper proposals into the language of a Bill highlights matters which are of special parliamentary concern, particularly in a Second Reading debate. Thus, before I turn to the detailed provisions of the Bill, the House may find it helpful if I sketch, first, the changes that the Bill seeks to bring about and how its provisions are designed to fit into the existing constitutional framework in Northern Ireland.

The Bill's provisions reflect a radically different approach to the devolution of legislative and executive powers and to the formation of a Northern Ireland Administration, but it seeks to achieve its objectives, so far as possible, by using the constitutional frame-work established by the Northern Ireland Constitution Act 1973 and the Northern Ireland Act 1974. Three features of the Constitution Act remain of particular importance. The first and most important is that Northern Ireland's position as a constituent part of the United Kingdom will remain as in section 1 of the Constitution Act. There will be no change. Let me say it once again: there can be no change in that status without the consent of a majority of the people of Northern Ireland voting in a border poll.

Secondly, part III of the 1973 Act makes extensive provision for the prevention of religious and political discrimination in the Province. That, too, will remain unchanged by the Bill. I believe that fundamental human rights are well protected in Northern Ireland.

The House will also recall that the Constitution Act places legislative responsibilities into three categories. They comprise "excepted" matters, which will remain permanently the responsibility of this Parliament—matters such as the Crown, foreign affairs, and defence. Then there are "reserved" matters. The responsibility for these would remain initially with Westminster, but it could be transferred to local control at some future date once a durable and stable system of government was established again in Northern Ireland. These chiefly concern various matters of law and order, which, for the time being, the Secretary of State will continue to administer. Lastly come the "transferred" matters, which comprise everything else. It is these, which are now the administrative responsibility of the seven—soon to become six—Northern Ireland departments, for which the Government envisage responsibility passing either in whole or in part to a devolved Administration.

Having outlined the major points of continuity, I should like briefly to summarise the changes that the House, particularly in this Second Reading debate, may want to examine later in more detail. The major differences that we envisage from the Constitution Act are three. First, the Bill lays responsibility for making proposals for a devolved Administration squarely on the Assembly itself. Secondly, new provision is to be made to enable legislative and executive power to be devolved on the Assembly either by a complete return of all the matters in the transferred category or by devolving responsibilities in more than one stage. Thirdly, the Assembly is to have vital scrutinising and monitoring functions pending devolution. The Bill accordingly sets out the Assembly's functions before it assumes power.

I should emphasise at this point that the reason why the Bill does not deal with relations with the Republic or with the Anglo-Irish Intergovernmental Council is that these are not matters on which any further legislation is required. The Anglo-Irish Intergovernmental Council is already established. There is already statutory provision in the 1973 Act enabling a Northern Ireland Administration to reach bilateral agreements with the Government of the Republic on transferred functions if they so wish. Hon. Members interested in the proposed interparliamentary body will appreciate that an elected Northern Ireland Assembly would provide an opportunity for a valuable Northern Ireland input to any such body on which this House and the Dail may agree. In that respect, the proposals are complementary and not alternatives to the Government's policy of maintaining sensible and, indeed, close arrangements for co-operation with the Republic.

My right hon. Friend's answer to the right hon. Member for Down, South (Mr. Powell) was not as clear as he suggested. He left a doubt, at least in my mind, about whether, if Northern Ireland had devolved Government, she would. get 17 hon. Members in the House. Will he make it clear that I have misunderstood him and that whatever happens there will be 17 hon. Members from Northern Ireland n the House?

There will be 17 hon. Members from Northern Ireland in the House until the House decides otherwise. The only time that the House would be likely to decide otherwise is if it wished to look at the matter afresh pending full devolution. [HON. MEMBERS: "Ah!"] I cannot tell what a future House of Commons might do, but the Bill makes no difference to the fact that there will be 17 hon. Members representing Northern Ireland in the House. Nothing that we do changes that.

If the right hon. Gentleman were to be fair to Northern Ireland he would give us 21 seats, as suggested by the convention report.

Seventeen seats still leave Northern Ireland with bigger constituencies than it would have if it were anywhere else in the United Kingdom—certainly in Scotland. That is the point that Mr. Airey Neave made. That is another point that justifies 17 seats for Northern Ireland.

I turn to the detailed provisions of the Bill. Clause 1, which gives effect to paragraphs 38 to 50 of the White Paper, goes to the heart of the whole Bill. It enables the Northern Ireland Assembly to submit proposals to the Secretary of State for the resumption of devolved Government in Northern Ireland, it allows for the devolution of only a few powers, if that is what the Assembly wishes, and it prescribes tests for the submission of devolution proposals. I shall deal with each of these points in turn.

Under section 2 of the Northern Ireland Constitution Act 1973, devolution of legislative and executive functions could take place if it appeared to the Secretary of State that an Executive could be formed which was likely to be widely accepted throughout the community. The hope was to secure full devolution in one move, after agreement among the parties on the composition of what became known as a "power-sharing" Executive. But the provisions of clause 1 of the Bill are more flexible. As the Government explained in paragraphs 41 and 42 of the White Paper, our aim is to give the people of Northern Ireland themselves, through their elected representatives, the fullest opportunity to reach agreed arrangements for an acceptable form of government. There is therefore no requirement for a Northern Ireland Administration to be composed in a particular way, and the Government do not favour any particular scheme. The arrangements are to be settled by the Assembly.

It is also because we wish to leave the greatest possible scope for local initiative that the Bill makes provision for devolution in stages. There are many issues, particularly in the economic sphere, on which representatives of local parties already make common cause, both in the European Parliament and elsewhere. Accordingly, there might be agreement on a scheme for partial devolution. Some hold that such a half-way house agreement is unlikely, but we believe that it is right to allow for that possibility. and provision is made in the clause for the Assembly to make such proposals.

Proposals put forward under subsection (1)(a) refer to the full devolution of legislative and Executive responsibility for the functions which were transferred under the 1973 arrangements. We do not propose that any matters which are "reserved" under the Constitution Act should, at this stage, be devolved. But, as we make clear in paragraph 54 of the White Paper, we shall consider whether any of the matters currently placed in the "reserved" category in the Constitution Act should eventually be removed to the "transferred" category. Any such consideration must depend on the establishment of a durable and stable system of government in Northern Ireland.

I come now to the two alternative tests for the submission of devolution proposals to the Secretary of State. Under clause 1(4)(a), if 70 per cent. of the membership of the Assembly agree on devolution proposals, those proposals automatically go to the Secretary of State. It is important to be clear that 70 per cent. support for any proposals guarantees that they will be sent to the Secretary of State who will lay them before Parliament. At that point the proposals will be debated and the Government would have to give a clear view on whether those proposals met the essential criterion of acceptability to both sides of the community. If that criterion were met, the Government would ask Parliament to approve the Assembly's recommendations so that devolved government could be restored.

Clause 1(4)(b) provides the alternative test whereby if a majority of the Assembly, but not 70 per cent., can agree on devolution proposals which in the Secretary of State's view commanded widespread acceptance throughout the community, the Secretary of State can ask for those proposals to be sent to him. Again, those proposals would be debated in Parliament if the Secretary of State was satisfied that, although falling short of 70 per cent., they did none the less enjoy cross-community support.

Let me reiterate that the 70 per cent., guarantees parliamentary consideration. Once the Assembly's proposals have been submitted, it will be for Parliament, and Parliament alone, to decide whether powers should be devolved.

I should also make it clear that the 70 per cent. relates solely to the Assembly's proposals for devolution. There have been misunderstandings—genuine in some quarters, wilful, I suspect, in others. Some people seem to think that, once devolution has taken place, all Assembly votes will be subject to a 70 per cent. hurdle. Others have said—most recently the deputy leader of the SDLP—that after devolution
"all decisions taken on the floor of the Assembly … would be made by simple majority vote".
I stress that there is nothing in the Bill that justifies or lends any colour to either of those different views. The truth is that the Bill lays down no limitations whatsoever on how the Assembly shall operate after devolution. That is a matter that will be wide open for the Assembly Members to consider together, and negotiate about, when they are drawing up proposals to be put to Parliament. Under clause 1(3) the Assembly's proposals for devolution could include recommendations on voting procedures—for example, on new key issues of confidence the Assembly may wish to propose that a specified majority should be required.

Will my right hon. Friend clarify the position about the referral to the House by the Secretary of State of a proposal for devolution that has been agreed by 70 per cent. in the Assembly? Can my right hon. Friend confirm that it is possible that the House might not agree to a proposal, even though it has the 70 per cent. approval of the Assembly? Can my right hon. Friend envisage such circumstances occurring and what a possible subject might be?

That would be a matter for the House. The figure of 70 per cent. was struck because it should, under normal circumstances, ensure that there is cross-community support. All that it actually does is to ensure that there is a discussion by the House. It does no more nor less than that. I must make it absolutely clear that the House is not likely to grant a transfer of powers unless it is satisfied that there is cross-community support, otherwise there will not be the political stability that we are aiming to achieve. If I continue with one more sentence in my speech, that will become clear to my hon. Friend.

Perhaps my hon. Friend will allow me to continue, and I shall give way later if necessary.

Once proposals have been submitted to the Secretary of State under these provisions, clause 1(5) and clause 2 will apply. The effect will be that Parliament will consider the proposals—and it is, of course, the Government's intention that they should have a full opportunity to do so before deciding whether to take further action. If the House's response is favourable, clause 2 provides for full or partial devolution by Order in Council, subject to affirmative resolution of Parliament. Parliament will, therefore, have two opportunities to consider matters before final decisions are taken.

If the Assembly proceeds to partial devolution only, clause 2(1)(b) provides that only whole Departments can be devolved, and subsection (4) prevents the devolving of the Department of Finance and Personnel. This is, I believe, common sense. The Department of Finance and Personnel could scarcely be devolved while some Northern Ireland Departments remained under the control and direction of the Secretary of State.

We intend, however, that devolved Departments should, nevertheless, have wide discretion to establish their own priorities in expenditure. The total resources that would be made available to the devolved Departments as a group would, of course, have to be settled between the Secretary of State and the heads of those Departments.

Once a power has been devolved, if the Assembly exercises that power in a way that the House of Commons suspects may be unfair or unjust to a group within the Province, will the House have no residual supervisory power and no right to ask questions about it?

Under those circumstances we can take power back. I shall come to that point in a later clause that I believe is important.

I come now to schedule 1. Part I provides for a return to full devolution and thus, in effect, reactivates the machinery established by the Constitution Act, as amended by the other provisions of the Bill. Part II makes provision for partial devolution, should this be a course which members of the Assembly would prefer to pursue. The essence of part II is that, under partial devolution, direct rule as provided for by schedule 1 to the Northern Ireland Act 1974 will continue in respect of those Departments which are not devolved, while legislative and Executive responsibility will return to the Assembly and a Northern Ireland Administration in respect of those matters that are devolved.

The Secretary of State referred to stability. For how long can a situation last where the hon. Member who, say, represents Lurgan on schedule 1 and 2 issues can vote in relation to matters affecting, say, the constituency of Lowestoft, but an hon. Member representing Lowestoft cannot vote on matters affecting Lurgan? How does the Secretary of State get over that rock-like difficulty?

In the same manner as happened in the 50 years of previously devolved Government. Exactly the same happened then. Ulster Members were able to vote in the House—

Does the right hon. Gentleman remember what my right hon. Friend the Member for Huyton (Sir H. Wilson) said about that?

I shall not enter into a discussion on what the right hon. Member for Huyton (Sir H. Wilson) said on the subject.

There is an answer to the so-called West Lothian question. Northern Ireland has never in its history been administered as an integral part of the United Kingdom.

I shall come to that question in a moment. The general point that my hon. Friend makes is correct. Even now, although there is direct rule, all the apparatus of devolved administration is there, but in a different way from that in the rest of the United Kingdom.

Clauses 3 and 4 provide that even before the Assembly acquires legislative functions following devolution it will, nevertheless, have, from its inception, important scrutinising, deliberative and consultative functions. Under clause 4 the Assembly will be obliged to establish a Committee corresponding to each Northern Ireland Department to enable it to carry out this work. Provision is also made for the payment of the Chairmen and Deputy Chairmen of these Committees. There is also provision for the Secretary of State to refer to the Assembly proposals for Orders in Council as well as subordinate instruments, and to consult it about other matters affecting Northern Ireland whether or not they lie within the transferred field.

The Government intend to involve the Assembly in the consultation process on proposed legislation so that Members can make their views known and have them considered by the Government before the legislation is laid before Parliament. I want the House to be clear on the critical importance that the Government attach to this innovation. The new Assembly will provide what up to now has been lacking during direct rule—a local forum in which the views of the elected representatives can be expressed, formulated and presented to the Government and Parliament.

As I have just said, there exists in Northern Ireland at the moment a substantial devolved administrative machine—the machine which underpinned Stormont for 50 years—but there is no corresponding democratic check on it. Hon. Members know full well that this House does not, and is never likely, to give close attention to the many orders affecting Northern Ireland, and my hon. Friend the Under-Secretary of State, the hon. Member for Oxford (Mr. Patten), told the House a couple of weeks ago that the question he was then answering was the first he had had for 10 months, on health and social security—which amounts to about half of public expenditure in the Province.

We believe that it is vital for the political health of Northern Ireland that locally elected representatives should be able to engage once again, and as soon as possible, in political dialogue and discussion, and be able to influence policy more directly than at present. I assure the House that the Government will therefore give the most careful considerations to the recommendations of the Assembly, both in regard to legislation and other matters.

During the debate on the White Paper, various hon. Members from Northern Ireland suggested that, even before any devolution has occurred, the Assembly should be able to discuss questions of security. The Bill provides that, pending full devolution, they could do so only if it was referred to them by the Secretary of State. The Government have always recognised that questions of law and order are of vital concern to the people of Northern Ireland and their elected representatives. As the House knows from paragraph 54 of the White Paper, we envisaged that suitable arrangements would be needed to enable the Secretary of State and the Assembly to discuss security matters. The arguments put forward during the debate on the White Paper have highlighted the concern in Northern Ireland over law and order issues, and I know that the House will want to look carefully at the provision of clause 3 during the Committee stage of the Bill.

I should also like to clarify the function of the presiding officer in relation to appointments to the statutory Committees. When the presiding officer comes to make appointments to committees, the House will see that, under clause 4(2), he is subject to a specific statutory duty to secure that the balance of parties in the Assembly is reflected, so far as is practicable, in the appointments of the chairman, deputy chairmen and members of each Committee.

Clause 5 contains a number of provisions—which I hope it will never be necessary to invoke—dealing with the dissolution of the Assembly and the revocation of orders. This matter was referred to by my hon. Friend the Member for Wolverhampton, South-West.

Clause 6 requires the Northern Ireland Constitution and Assembly Acts 1973 to be amended in accordance with schedule 2. The schedule affects a number of matters, including the detailed arrangements for appointments to the Northern Ireland Executive, and to the headships of Northern Ireland Departments; the Assembly's privileges and the remuneration of its Members; the arrangements for the dissolution and prorogation of the Assembly; legislation on "reserved" matters by Order in Council after full devolution takes place; and it contains other more technical and consequential provisions which I hope will not engender controversy.

The Government recognise how difficult it will be to achieve lasting improvement. If they did not recognise that before, they have recognised it as a result of the comments of my hon. Friends and other hon. Members this afternoon. That is why the Bill takes such modest and limited steps, for no amount of window dressing can hide the fact that peace and improved prosperity will come to Northern Ireland only if the various factions are prepared to make accommodations with one another. At present they do not wish to do this. To do nothing is, therefore, easier for them. They have all the advantages of political activity with none of the disadvantages of responsibility. There is, therefore, no reason why the parties should agree in advance.

I make no complaint about that. It is, after all, what the representatives of the various parties were chosen to do, but it is not a luxury that this Government can share. Their job is to weigh the problems and to proceed in the best interests of the whole people. In the face of the suffering, the economic decline and the political stagnation, the onus of proof lies as much upon those who would do nothing as on the Government.

It is said that there is no support in Ulster. I do not believe it. The Government believe there is a real desire across the broad mass of the population for a break in the deadlock. The Bill will begin that slow and difficult process, and I hope that it will have the support and good-will of the whole House.

4.16 pm

During today's debate and in subsequent stages on the Bill, it will be the Opposition's intention to ensure that, wherever possible, this legislation matches some of the fine phrases contained in the first section of the Government's White Paper and reflects the spirit of our own policy document on Northern Ireland.

In many respects, our policy document and the Government's views, as laid down in the White Paper, are similar. On the central issue of cross-community support on the devolution of powers, we are virtually in agreement. Paragraph 13 of the White Paper states:
"The Government adheres to the view that in any administration in Northern Ireland there must be reasonable and appropriate arrangements to take account of the interests of the minority which are acceptable to both sides of the community".
Our own policy paper says the same thing, but in fewer words. It states:
"The success of devolved government depends upon it receiving the confidence and support of a substantial cross-section of both communities."
It is in that spirit that the Opposition will in future be tackling the proposals in the Bill.

Will the right hon. Gentleman address his mind to the position in Scotland and to the Scottish National Party? Will he put that in the context of the Bill and the Opposition's proposals? Should the SNP also be represented in Scottish administration?

I said in the debate on the White Paper, and based on my experience in Northern Ireland, that the problems of Northern Ireland should be viewed in a different context from those of Scotland and Wales. I cannot envisage problems affecting Scotland and Wales that require the same kind of resolution or solution as the problems affecting Northern Ireland.

When we debated the White Paper "A Framework For Devolution" on 28 April, I referred at length to the general inadequacies of the Government's proposals. On that occasion I pointed out that the Opposition do not think that the Government's proposals in the Bill live up to the political realities as outlined in the first part of the White Paper.

We find the Government's analysis of Northern Ireland's political problems broadly acceptable, and we support their recognition of the two identities. However, our conclusion is that the Bill does not properly cater for the political realities of Northern Ireland, and I intend to draw specific attention to those areas that we think fail to fulfil the Government's criteria of cross-community acceptability. We hope that the Bill and the Assembly will get off to a good start.

The first worrying omission from the Bill concerns the election of the Presiding Officer of the Assembly. This matter was discussed at length in the debate on the White Paper, but I should like to say a few words on the subject.

As the Presiding Officer is not mentioned in detail in the Bill, the provisions of the Northern Ireland Constitution Act 1973 will apply, once the Assembly has been elected. Section 24(1) and (2) of that Act provide for the presiding officer to be elected by the Assembly, presumably on a simple majority vote. In our view, if that provision remains in force, there is likely to be bitterness from the outset about the election of the Presiding Officer. He or she will almost certainly be a politically active unionist who will probably not have the confidence of all parties in the Assembly. The Presiding Officer will hold considerable powers, as several right hon. and hon. Members said during the debate on the White Paper, and in our view the Assembly would get off to a bad start if the Presiding Officer had the support of only one section of Assembly Members and only one section of the community.

The Secretary of State should consider the potential problems should the 1973 provisions about the Presiding Officer remain unamended. He may wish to look at the arrangements introduced for the 1974 constitutional convention, when the Secretary of State had the power to appoint a Presiding Officer or Chairman, as he was then known. We should like the relevant provisions of the 1973 legislation to be amended so that the Secretary of State would have the power to appoint a Presiding Officer who at the time of appointment may or may not be a Member of the Assembly. Such an amendment would go a long way to ensure that a person acceptable to both sides of the community would hold this important position. It would not be a fail-safe method, but it would be a considerable improvement on the present provisions for electing a Presiding Officer.

Clause 1 enables the Assembly
"to submit proposals to the Secretary of State for the resumption of devolved government in Northern Ireland".
We have several reservations about the clause. Subsection (1) permits either full or partial devolution. What concerns us particularly is that the Assembly can ask for some but not all of a Department's functions to be devolved. To cater for that, the existing departmental structure would have to be altered, because we are told that devolution can take place only by reference to all functions of a particular Department.

I hope that the Secretary of State or one of his Ministers, in winding up, will explain what will happen if all the parties in the Assembly agree on devolving four functions of one department, say, the Department of the Environment. Will he then split the Department in half and make two Departments of the Environment with two political heads, one responsible to this House and one responsible to the Assembly?

No doubt the Minister will say that I am taking an extreme example, but that is the logical consequence of the proposal. Will he say how far the Government are prepared to go with the reorganisation of the Northern Ireland Departments to accommodate devolution? There must be some limit to the departmental changes if total chaos is to be avoided. Confusion will be rife if every Department is split. No one will know where the responsibility for political decisions lies. We are anxious about this proposal and expect thorough answers to the questions that I have posed.

Clause 1(2) gives the Assembly responsibility for deciding how executive functions should be operated when some or all the powers are devolved. This is a crucial provision of the Bill, as the Secretary of State said. We doubt whether there will be much agreement within the Assembly about how power should be exercised in the event of devolution.

Had this been our Bill, we should have laid down much tighter criteria—this, possibly, is where the main difference between us lies—for the inclusion of the minority at every level of executive power. We do not fully agree with the thinking behind the subsection, but we do not intend to oppose it. The problems engendered in 1974 are still in our minds—they are certainly in my mind—and we are prepared to see what sort of proposals the parties in the Assembly hammer out for themselves.

I fully understand that there may be differences of emphasis about the degree of protection that the Bill offers or should offer to the minority community, but is the right hon. Gentleman willing to say that, in his view, no minority community should have a veto?

Certainly. I shall come to the question of the veto later. It has been common ground, as I tried to make clear in the first instance, that before anything can succeed in Northern Ireland it needs the broad support not only of the minority community but of the majority community as well. Nothing would guarantee failure more than if anything proposed here did not have the support of the minority. However, I do not want to start talking about anyone having a veto. What we need is common agreement across the board. That is the only way to achieve success in Northern Ireland.

The Opposition are not optimistic. We doubt whether the time has yet come when the majority is prepared to realise that real security lies in the sharing of power and in partnership with the minority community. If and when devolution reports come to the House from the Assembly, it is the proposals in subsection (2) that we shall need to scrutinise closely.

Subsection (4), on which the Secretary of State spent some time, seems to be something of a mixed bag. On the one hand, we are told that any devolution proposals that have the support of at least 70 per cent. of the Members of the Assembly, will be laid before Parliament. On the other hand, we are told that devolution proposals with the support of between 50 and 75 per cent. of the Assembly Members may be laid before Parliament if the Secretary of State is satisfied that they carry cross-community support.

We have no quarrel with paragraph (b). The Secretary of State is our man on the spot. He, more than anyone, should be able to decide whether a set of proposals has cross-community support. Our quarrel is with paragraph (a). As I understand it, the reason for introducing the idea of a 70 per cent. majority was to ensure that devolution proposals had a demonstrable measure of cross-community support. As I said in our debate on the White Paper, I fully understand the reasoning here. The aim is a good one, but I doubt whether paragraph (a) will fulfil that aim. There is no guarantee that 70 per cent. of the Members of the Assembly supporting any given proposals will reflect all sections of opinion. The House should bear in mind that, in the 1974 Assembly and in the 1975 Convention, the Unionist Party had nearly 70 per cent. of the seats, but with the support of minor parties, it held well over 70 per cent. We cannot say whether that will be the case in the new Assembly, because elections have yet to take place. I do not suggest that we should await the election results before deciding on the percentage, but I question the need for this fixed percentage, given that we have paragraph (b).

Let us suppose that certain devolution proposals have the support of 70 per cent. of the Members of the Assembly. Indeed, it could be even more than 70 per cent. In the convention report, it could have been as high as 78 per cent. of Members of the Assembly, and not one representative of the minority community needed to vote for that proposal. The Secretary of State would then, under subsection (5) of the clause, be bound to lay those proposals before Parliament. By that time, I imagine that it would have been made clear that the minority community did not like the proposals. What would the Secretary of State do then? Would he be prepared to come to the House and to say that although the proposals had fulfilled the criteria in the Bill, he could not recommend them to the House because they did not have cross-community support? That would be a very difficult position for the Secretary of State to take. His hands would be tied by this clause. Imagine the reaction in Northern Ireland if proposals with a 70 per cent. or even a 76 per cent. majority were turned down by Parliament, the very body that set such store by that figure.

Does the right hon. Member agree that if the words "widespread acceptance throughout the community" were added to the percentage in subsection (4)(a), it would serve the purpose that he seeks?

The answer is contained in subsection (4)(b). Paragraph (a) could be done away with completely. We shall have to take a long, hard look at the subsection. Unless the weight of majority is 80 per cent. or more, it is worthless. Only a figure of that order would demonstrate that devolution proposals had cross-community support.

Our view is that it is unnecessary to set any figure. During the White Paper debate, I could detect little support for the 70 per cent. idea. That lack of support is unsurprising, since each group is afraid that another will be able to veto its proposals. It would be more sensible to dispense altogether with the idea of a fixed majority. We believe that any devolution proposals which have a majority in the Assembly, of whatever order, should be submitted to the Secretary of State. It should then be for him, and for him alone, to decide whether they have the necessary measure of cross-community support.

Will the right hon. Gentleman agree that the general understanding in the White Paper debate was that paragraphs (a) and (b) were much the same? The difference was that there was no compulsion in the second paragraph. Instead, the Secretary of State would give a clear indication, the Government would make their views known, and the Whips would be on to make sure that the decision was obeyed.

I certainly do not think that the paragraphs amount to the same thing. I shall refer later to parliamentary control, but my view is that the 70 per cent. is unnecessary. From what I have both heard and read and from the protestations made to me, nobody seems to want the provision. Everybody is suspicious of it and it is unnecessary. I accept that the Secretary of State knows his job and will be able to decide whether there is cross-community support, and make the right recommendations to the House. It will then be for the House to support or reject those recommendations. If a report commanding a 75 per cent. majority within the Assembly were presented to this House, and the Secretary of State had to report that the proposal did not have cross-community support, and that not one of the minority Members elected to the Assembly had voted for it, this House would be placed in a very difficult position. Leaving the 70 per cent. majority in the Bill presents a danger of creating two types of report from the Assembly. Any proposal that has a 70 per cent. majority or more will inevitably carry weight because it has met the superficial criteria laid down by Parliament, yet it may not have met the more important criteria of cross-community support.

I urge the Secretary of State to examine paragraph (a) again and to consider dispensing with it. We shall be tabling an amendment to that effect, so we shall be able to discuss the matter much more thoroughly in Committee.

It will not help the right hon. Gentleman in his lucubrations on his prospective amendments—[Interruption.] I am told that is an Irish word. It will not help him if he simply moves to leave out paragraph (a), because the effect will be that the Secretary of State will then exercise his discretion privately and negatively, and no proposal will come before the House. If the right hon. Gentleman wishes the House itself, on the motion of the Secretary of State, to take a view on the matter of widespread acceptance, he will need more far-reaching amendments—which I am sure could be debated—to the Bill. Perhaps he will not mind my pointing that out to him.

I am willing to accept advice on these matters. In due course, we shall be moving amendments that will have the purpose of removing the 70 per cent. and leaving the matter of cross-community support in the hands of the Secretary of State.

The provisions in clause 2 do not meet with our entire approval. Should we ever reach the stage when the House considers that powers can be devolved to Northern Ireland, we think that a single Order in Council, which cannot be amended, and which may be taken late at night, is a very inadequate instrument through which to pass powers back to Northern Ireland. It is not practicable to propose that each power be devolved by Act of Parliament, but we should like some assurances from the Secretary of State that adequate time and attention will be given by the House to the devolution proposals.

Two possibilities spring to mind. First, if and when an Order in Council is made to devolve power, it will be more sensible if it contains provisions relating to a single Department. We can then have separate discussions on devolving powers under, say, agriculture and commerce, rather than having the two lumped together in a single order. Similarly, if and when all transferred functions are to be devolved, we think it would be wise to deal with them on the basis of one Department at a time. The House would then have an opportunity to assess fully the implications of devolving powers under each Department.

Secondly, there may be scope here for developing a new procedure to consider proposals for a draft Order in Council. If the right hon. Member for Down, South (Mr. Powell) has any advice on this area, I shall be glad to look at it closely. I have been trying to find a solution that would enable this House to have a much greater say in or control over the devolution of power, other than by order.

I am very grateful to the right hon. Gentleman and much complimented by his reference to me. However, there is a difficulty attaching to his suggestion that only one Department should be dealt with at a time by any one order. Indeed, there is an opposite difficulty, a deeper difficulty, in the Bill, namely, what is to be the relationship, under partial devolution, between the heads and the policies of the separate devolved Departments, since they will all be treated—so we heard from the Secretary of State this afternoon—as a group for the purposes of financial allocation?

We had better try to think of something else that might be helpful to the House. The legal advisers will have to start looking at the proposals for draft Orders in Council. At present, the proposals for a draft order are printed, and written objections are invited. I was wondering whether the matter could be dealt with by an appropriate Committee of the House of Commons. I do not think that the Northern Ireland Committee is the appropriate one, but possibly a Committee could be set up to consider the proposals for a draft order to suspend parts of direct rule. It would expand the opportunities for discussion and amendment on such an important issue. I should be interested to hear the Secretary of State's views on that matter. It would appear, from the debate on the White Paper, that many hon. Members would regard the all-in-one or take-it-or-leave-it basis of an Order in Council as an unsatisfactory way of devolving power to Northern Ireland.

We do not have many objections to clause 3. As I said during the debate on the White Paper, there may be considerable merits in having a Northern Ireland Assembly which can make its views known, even if powers are never devolved. However, I wish to stress again that there are dangers in allowing the Assembly to turn into a talking shop which simply institutionalises the political differences in the Province. To avoid that, the Secretary of State must be prepared to take a great deal of notice of what the Assembly says, even if it is in direct conflict with his Government's policies.

During the debate on the White Paper I asked what the Secretary of State will do if the Assembly makes it clear that it does not wish a particular piece of legislation to be introduced in Northern Ireland. I did not receive an adequate answer to that question during the ministerial reply. The Secretary of State should tell the House today what will be the priorities in such a situation. What is the status of the opinion of the Assembly prior to devolution? Will the Secretary of State put the views of the Assembly before Government policies? The people of Northern Ireland, who will be electing Assembly Members, have a right to know the answers to those questions.

We have said before that in several areas the Bill fails to cater for the political realities of Northern Ireland. One such failure concerns the lack of any reference to the Irish dimension. The White Paper contained a few derisory paragraphs and the Bill contains nothing. The Government clearly recognise that there are two nationalist identities in Northern Ireland. One group, the majority at the moment, prefers membership of the United Kingdom, while the other group would prefer its section of the country to be part of the Irish Republic. The two identities are there. Ignoring them will not make them go away.

Furthermore, we should never forget that while Northern Ireland is presently part of the United Kingdom, it has a land border with the Irish Republic. The two parts of Ireland do have a common interest in matters of energy, commerce, culture and, as the Secretary of State mentioned, security. There are many ideas which can and should be shared.

We should like to see provision in the Bill for the Assembly to establish a committee to deal solely with matters relating to the Irish Republic. Such a committee would be able to have joint discussions with the relevant authorities in the Irish Republic, and, as a result, could make recommendations to the Assembly. If such a committee were established under direct rule it could supplement the work of the Northern Ireland Ministers. Under devolution, it could make suggestions to the Executive.

Section 12 of the Northern Ireland Constitution Act 1973 provides for the devolved executive authority to take part in consultations and agreements with the Irish Republic. In the absence of any devolution, we believe that elected representatives in Northern Ireland should talk about matters of common concern with the Irish Republic. We therefore ask the Secretary of State if he will consider making provisions for such a committee rather than leaving the decision to the Assembly under clause 1(3).

I turn to clause 4. Once again we ask the Secretary of State a question which was posed under clause 3. What will be the status of reports from Assembly committees? What course of action will the Secretary of State take if one or other of those Committees makes an outright condemnation of Government policies in a certain area? In short, is he prepared to act against the elected representatives of Northern Ireland? That is a question that needs a clear answer.

I have referred to some of those sections in the Bill which cause disquiet on the Opposition Benches. There are many more points that I wish to raise, but they can wait for the Committee stage of the Bill. We do not intend to divide the House on Second Reading. As I have said before, the Bill, in spite of its inadequacies in certain areas, is broadly in concert with our policy of devolving power back to Northern Ireland. Rolling devolution might be all right. The Opposition are very wary of creeping back to Stormont. So, in the coming stages, our intention is to strengthen the Bill so that we can get the maximum of the cross-community support necessary for devolution.

If, however, the House divides on the amendment, we shall not support such an attempt to wreck the Bill. For the reasons that I have just given, I shall advise my right lion. and hon. Friends to vote against the amendment.

4.44 pm

I beg to move,

That this House declines to give a Second Reading to a Bill which lacks broad support in Northern Ireland, does nothing to achieve the defeat of terrorism or to revive the economy of the Province, and contains provisions which, if enacted, would undermine the unity of the Kingdom.
The supporters of the amendment include my right hon. Friend the Member for Brighton, Pavilion (Mr. Amery) and my hon. Friend the Member for Beckenham (Sir P. Goodhart) who was a Minister in the Northern Ireland Office. The fact that the speech of the right hon. Member for Mansfield (Mr. Concannon) was heard by only two Labour Back Benchers in this important debate, will he noted by the House and by the country.

The hon. Member for Epping Forest (Sir J. Biggs-Davison) must not regard the number of members on the Opposition Benches as anything more than a sign of the quiet confidence in which they hold their Front Bench spokesmen. It is quality, not quantity, that counts on the Labour side.

I still believe that on such an important Bill relating to the future of Northern Ireland we might have expected hon. Gentlemen to be in attendance in considerable numbers. The speech of the right hon. Member for Mansfield appeared to be constructive, but it came out extremely critical in detail.

It gives me no pleasure to be at variance with my right hon. Friends on the Government Bench. My right hon. Friend the Secretary of State dislikes any comparison being made with the Falkland Islands, but that comparison was made by Ulster people long before he became Secretary of State.

In the month before the Argentine aggression, I wrote in the Belfast News Letter of
"policy makers who impatiently resent the insistence of Falkland Islanders and Gibraltarians that they are British. They regard the Northern Ireland loyalists as a bore."
Lord George-Brown, when at the Foreign Office, tried to surrender the Falklands, but we stopped that. A Foreign and Commonwealth Office official connected with these matters told Airey Neave and me that he was "neutral on the Union". No wonder Galtieri believed that it would be nothing but a regatta. No wonder the IRA has persevered for a period longer than the two World Wars. The IRA can read White Papers, and its often flagging hopes have been revived by every political initiative taken since, and including, the prorogation of the Stormont Parliament which is now cited in support of devolution by those who abolished it. The IRA can read, and it reads in the Bill the differentiation and distancing of Northern Ireland from Great Britain. We should be doing everything we can to strengthen the Union in which we believe.

The Bill and the White Paper damn the Union with faint praise. Whether in the South Atlantic or in Northern Ireland—my right hon. Friend mentioned the sacrifice in Northern Ireland—we pay in blood and treasure for the impressions that we give. Both areas are of prime strategic importance. Without the Ulster ports, Hitler would have won the second battle of the Atlantic and, in Churchill's words, would have confronted us with "slavery and death". NATO thinks and must think in terms of a possible third battle of the Atlantic.

I wish to compliment my right hon. Friend the Secretary of State and his colleagues on the Treasury Bench on their unremitting efforts to shield a hard-hit Province from the worst effects of the recession and to bring in investment. But my right hon. Friend regards political stability and, therefore, the Bill as going hand in hand with economic recovery and the defeat of terrorism. It is the contention of those who have set their hand to the reasoned amendment that the Bill will not make for that political stability and is more likely to provoke terrorism than to reduce it. Any suggestion that direct rule—that is the present system of government—is inherently unstable can only deter the investors that Ministers are courting. It contradicts the message of the films that some of us had the privilege of seeing recently which were made to demonstrate the normality of most of the Province most of the time.

The Secretary of State from time to time describes direct rule as "everyone's second choice", but agreement on a second best seems better than no agreement. With all its defects, direct rule has wider acquiescence in Northern Ireland than the devolved government that preceded it.

In 1979 the Northern Ireland Attitude Survey of Queen's University, Belfast, revealed that 92 per cent. of Roman Catholics wanted
"Laws in Northern Ireland to be as far as possible … the same as laws in the rest of the United Kingdom."
I know that my right hon. Friend the Secretary of State gets restive if I quote public opinion polls. I assure him that I agree that they are not infallible, but they are indicative when they follow a pattern. An NOP survey screened by Ulster Television on 12 February gave not merely the Union, but full integration, as acceptable to 80 per cent. of Protestants and 45 per cent. of Roman Catholics. An earlier MORI poll, published, and grossly misinterpreted, by The Sunday Times on 8 June last year, gave a figure of 39 per cent. of Roman Catholics, as against the 45 per cent. in the NOP survey in February.

It is demonstrably foolish and mischievous to identify the Roman Catholic community with the Republican cause. That is not surprising when, for so long, members of that community have been the victims—terrorised, exploited and oppressed by gangsters, in the name of a united Ireland, or, rather, an all-Ireland Socialist Republic which would be about as Irish as Cuba.

Part 3 of the White Paper relating to "The Two Identities" is incomplete—indeed, misleading. The phrase in the Bill
"widespread acceptance throughout the community"
lacks precision. I am not quite clear what it means. The assumption in the Bill is that whatever opinion polls or right hon. and hon. Members may say, devolved government, as distinct from administrative devolution, which amply obtains in Scotland and Wales and should amply obtain in Northern Ireland, is what the people of the Province want.

One of my favourite newspapers in Northern Ireland is the Impartial Reporter and Farmers' Journal of Enniskillen. It is a moderate Unionist paper, which is much read across the frontier in the border counties of Eire.

A leading article on 29 April stated:

"The 'rolling devolution' scheme has fallen on stoney ground, with little prospect of fertilisation and eventual fruition."
Referring to the Assembly, it says:
"'A talking shop' is one description, but a very expensive one at that, as the election is estimated to cost in the region of £750,000 which could probably be spent to better account elsewhere in the Province, on housing for example. All the principal political parties have given Mr. Prior's plan the 'thumbs down'. The Official Unionists see no future in it; SDLP say it is unworkable; DUP are mainly against it, but find some parts acceptable and are willing to go into the election. Only the smallest party, Alliance, which is unlikely to have much strength in its representation, has shown any favour in the plan."
There is an addition to make. I hope that my right hon. Friend takes comfort from the support of the Workers Party.

What is the good of saying that political parties want devolved government when they want it in forms which are mutually exclusive? My right hon. Friend repeated today that he wants a local forum for politicians. I suppose that that is job creation of a sort, but Northern Ireland is the size of Yorkshire and has a population of 1½ million. Surely, if local government were properly constituted, with safeguards, and there were an enlarged representation in the House—and Ulster's representation in the House of Lords also needs attention—plus three seats in the European Assembly, that should give even the hon. Member for Antrim, North (Rev. Ian Paisley) enough scope.

Why do Ministers close options? Why have they set their faces against giving much more power to district councils? Why do they mind filling the Macrory gap in the local government structure which was left after the removal of the Northern Ireland Parliament and which was to have played the dual role of legislature and upper tier of local government?

If, as members of the SDLP commonly point out, injustice to the minority is feared, the Secretary of State has sticks and carrots to cure abuses, bash bigotry and allay those fears. We are often told about the enormities of the Lisburn borough council, but the council should not have been allowed to get away with that. We would not condemn English local government because of Mr. Ken Livingstone and Mr. Ted Knight.

But does my hon. Friend agree that, while councils are behaving like that, we would not want to give them extra powers, which is what he is advocating?

In accordance with the principle of rolling devolution, we could give councils powers according to their willingness and capability to use them. My right hon. Friend the Secretary of State has the power to deal with recalcitrant local authorities. For one thing, he has the money.

In many districts, Nationalist and Unionist councillors work well together. I pay tribute to the SDLP for being responsible for bringing that about in many cases. It is in local government that power sharing is feasible, appropriate and acceptable.

It would help us if the Secretary of State would say that, if the Assembly were found incapable of undertaking the functions that could be transferred to it under the Bill, the Assembly could be transformed into a regional or provincial council, playing a local government rather than central government role, perhaps analogous to the Strathclyde regional council—that may give some pleasure to Labour Members—which has been the subject of study in the Official Unionist Party. But here I am stepping perilously close to the bad taste of mentioning the general election manifesto of the Conservative and Unionist Party.

However, may I ask Conservative Ministers to refer now and again to the passage in that manifesto on Northern Ireland? Airey Neave is emblazoned in this Chamber and we might profit from his wisdom. In the "absence of devolved Government", to quote the manifesto, will my right hon. Friend not dishonour an election pledge, but proceed to implement it? It would help us if we could have an answer before the end of the debate.

My hon. Friend asked whether, if the Assembly did not work, we could transform it into a provincial assembly on the lines of local government, and he mentioned the Strathclyde regional council. The answer is that all the problems that we would have with devolved government—for example ensuring that there was minority representation—would exist with a provincial assembly dealing with the sort of problems to which my hon. Friend referred. We would have the same problems with both sorts of Assembly. That is the truth on that point. I have looked at this to see whether there was some way that we could do it. It is nonsense that the only powers possessed by local government at the moment are those of refuse collection and recreation. On the other hand, as soon as one embarks on a programme of giving additional powers, one runs into all the difficulties that my hon. Friend the Member for Epping Forest (Sir J. Biggs-Davison) has accepted. The second point he raises concerns the manifesto. The manifesto starts by saying:

"In the absence of devolved government".
I personally believe that, by seeking devolved government, we are not in any way going against our manifesto. I believe that this is abundantly clear.

In that case, I should like to know how long we must wait for this devolved government to come about. If there were agreement on sufficient scale in Northern Ireland and if the main elements in Northern Ireland politics were to come forward with a scheme of devolved government that they wanted, then, although we might have our reservations about the future of the Union and about what might happen in Scotland and Wales, we would have to accept what they wanted. But surely my right hon. Friend does not believe that this will happen. To set about trying to devolve central government powers without placing the minority in jeopardy is as difficult an operation as, or more difficult an operation than, trying to do the same in the sphere of local government.

Will the hon. Gentleman remind the Secretary of State and the House that the existing district councils, in their consultative and advisory character, exercise wide functions within the Department of the Environment where their advice is almost invariably accepted by the Department? That is substantial evidence that such extended functions would be exercised in the same co-operative manner as are the functions directly and legislatively conferred upon the district councils.

I am obliged to the right hon. Gentleman. I do not think that I need to remind my right hon. Friend of the words that came from the mouth of the right hon. Gentleman.

I have another question that I should like to put to the Government Front Bench. The Minister who is to reply can perhaps define what is meant by "cross-community" support or acceptability in the context of the 70 per cent. of Assembly Members required to agree on the exercise of powers and formation of an Administration as set out in paragraph 43 of the White Paper. For 12 years, I have spoken on Unionist platforms in favour of a separat ton of the Orange Order from the Unionist Party and the bringing forward of Roman Catholics in that party. I have had the presumption to do that, and I have been allowed to say it, which speaks volumes for the patience, restraint and tolerance of Unionists in Northern Ireland.

History and terrorism make this much easier for someone like myself to recommend than for it to be achieved. Nevertheless, let us suppose that a Unionist Party or group of parties were to return 70 per cent. representation made up of Catholic and Protestant Unionists perhaps in proportion to Catholics and Protestants in the Province. Does my right hon. Friend or the Government apprehend that Parliament would entrust those Unionists with devolved government? If the answer is "No", I say that this is one more way in which the Bill and the White Paper would have the effect of perpetuating a divided community.

It is my understanding—the Secretary of State may be able to enlighten us—that not only would Unionist Roman Catholics be unacceptable for the purposes of "cross-community consent", but that Roman Catholic Alliance Members would not be acceptable. In other words, they have to be Republican Roman Catholics.

This fills me with greater gloom and despondency about the Bill. Why should we say that "cross-community consent" means the agreement of Republicans and Unionists? This is the division that we should be trying to avoid in all that we endeavour to do for Northern Ireland within the United Kingdom. No encouragement is given to those Roman Catholics who increasingly favour the Union. I do not mean that they necessarily favour any Unionist party. However, they favour increasingly the Union and, more than that, full integretion of Northern Ireland within the Union.

My hon. Friend has drawn attention to an opinion poll which suggested that a majority of Protestants and Roman Catholics wish to see integration with the United Kingdom. Like my hon. Friend, I have doubts about opinion polls. Does he recognise that the same opinion poll, taken on the same day, answered by the same respondents, as the sociologists so trendily call them, produced a majority of 75 per cent. of Protestants and 67 per cent. of Catholics who wished Northern Ireland to remain part of the United Kingdom with its own power-sharing Assembly?

I had not intended to spend too long on this point, but I am grateful to my hon. Friend for completing the story. That shows that a large majority not only of Protestants, but of Catholics, favour the British link, whereas 45 per cent., slightly less than half the Catholic minority, favour the solution that my right hon. and hon. Friends and myself favour on the Northern Ireland constitutional question.