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Commons Chamber

Volume 35: debated on Wednesday 19 January 1983

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House Of Commons

Wednesday 19 January 1983

The House met at half-past Two o'clock

Prayers

[MR. SPEAKER in the Chair]

Oral Answers To Questions

Oral Answers To Questions

Order. Questions and answers have been getting much longer recently. I appeal to the House for briefer questions and therefore briefer answers.

Transport

Goods-Only Railway Track

asked the Secretary of State for Transport how many miles of goods-only railway track have been opened to passenger traffic since May 1979.

I understand from the Railways Board that 35 route miles of goods-only lines have been opened to passenger services since May 1979.

In view of those appalling figures, will the Minister take this opportunity to reject some of the more lunatic suggestions in the Serpell report? Does he agree with the principle of opening some lines for passenger traffic? If so, will not the opening of the Walsall to Rugeley line have enormous economic and social benefits?

Reopening the Walsall line is entirely a matter for the Railways Board and the local authority concerned, which has power to make grants to public transport operators. The Serpell report is important and its handling will be dealt with by my right hon. Friend in answer to a later question. There has been wild and deplorable speculation on aspects of the Serpell report, with which my right hon. Friend will deal.

Motorway Repairs

2.

asked the Secretary of State for Transport whether he is satisfied with the speed with which motorway repairs are undertaken.

In general, yes, but we are always trying to do better.

Why does so much motorway seem always to be under repair? Why does it always seem to take so much longer to effect repairs here than in other countries?

Perhaps my hon. Friend has not been in other countries as much as he has obviously been at home. I assure him that we do not take longer than other countries to effect repairs. To some extent we are the victims of our own success. We have 20-year-old or more roadways that have taken far more traffic than they were designed for. We must make the best use of our investment in motorways by maintaining them regularly and carrying out our rolling programme of improvement. We are renewing 70 miles of motorway each year. As soon as we have finished restructuring and resurfacing work, it will be easier to do that.

Is the Minister aware that it is pleasing to know that the British are pretty quick at improving motorways and getting repairs completed? Is she further aware that the Prime Minister keeps lecturing and telling us that the Germans and the Japanese are better than us at everything?

The speed of restructuring and resurfacing work depends entirely on the type of roadway being dealt with. Speed varies considerably from country to country. We do not do at all badly by international standards.

Why are miles of the M1 and M6 coned off when there appears to be no work going on?

Cones are required for several reasons, as I think my hon. Friend knows. They are used to protect concrete which is still setting. That can take some time. They are used to mark off excavated areas that must settle before more work can be carried out. They are also used so that damage to safety fences can be repaired. Sometimes weather conditions following the first stage of repairs or reconstruction do not remain suitable for the next stage to take place. Cones are not used unnecessarily on any motorway.

Road Works (Acton)

3.

asked the Secretary of State for Transport if he will make a statement on the progress of trunk road works and compensatory arrangements for those adversely affected in Perivale, Greenford and Northolt.

The three contracts on this length of the A40 are progressing satisfactorily. Negotiations on compensation for loss of land and property are either completed or under way. Noise insulation is being provided for eligible dwellings.

I thank my hon. Friend for that reply and for the care that she and her Department have taken over road works in that part of my constituency. Is she aware that many people are suffering to the point of having to take tranquillisers to steady their nerves? Will she assure me that people and their property will be looked after and completely protected from the effects of the road works?

I thank my hon. Friend for his comments about the help that he has received from the Department. There are three quite separate elements to compensation. The first is for loss of property, the second is to help with noise prevention and the third is for loss of amenities. All those matters will be dealt with. Negotiations are proceeding for the double glazing of about 200 properties, and we have completed about three-quarters of the qualifying properties about which my hon. Friend has been so concerned.

Diesel Multiple Unit Fleet

4.

asked the Secretary of State for Transport what investment approval he has given for the replacement of the diesel multiple unit fleet of British Rail.

My right hon. Friend has approved the construction of 40 light-weight vehicles as the first stage in a major construction programme. We look forward to receiving the Railways Board's proposals for medium-weight vehicles in due course.

Is the Minister aware that, because of the Government's continued delays and refusals to pump cash into British Rail to replace the ageing diesel multiple units, staff and passengers on lines such as the north-east Lancashire and many others must endure discomfort, or even worse? When does the Minister expect the fleets to be replaced not only by the light-weight but by medium-weight units? What funds will the Government allocate to the project?

The hon. Gentleman is wrong in his allegations about Government contributions. British Rail's investment ceiling has been maintained in real terms, and public support is at a record level. The hon. Gentleman should understand that everyone wishes the ageing fleet of diesel multiple units to be replaced. British Rail has brought forward plans for light-weight vehicles, and will produce plans for medium-weight vehicles. Decisions on placing further orders will rest with the Railways Board, subject to any investment approval that it may need from my right hon. Friend.

Why has the new investment on the St. Pancras-Bedford line not yet been utilised, even though £150 million of taxpayers' money was spent on the project a long time ago?

I very much regret that ASLEF is stopping that important investment being brought into proper use. My hon. Friend's question emphasises the tremendous importance of improved productivity to the future of the railways system.

Does the Minister agree that the investment ceiling to which he referred has become absolutely irrelevant for British Rail, and that the combined effect of the external financing limit and lack of Government investment approvals has been to reduce the real investment expenditure in every year since the Government took office?

As the right hon. Gentleman knows, a great deal of resources, which would have been available for investment in British Rail, have been lost because of the enormous cost of strikes—no less than £240 million last year.

Rural Areas (Transport)

5.

asked the Secretary of State for Transport what plans he has to improve public transport in rural areas.

I shall continue to encourage county councils to use their transport co-ordinating and revenue support powers judiciously. I shall also continue to encourage small private operators, which can sometimes provide services which larger operators find no longer economic, and the development of less conventional modes of transport.

Is the Minister aware that in some rural areas, such as Northumberland, increasing efforts have been made to co-ordinate rail and other forms of transport to provide a network of rural services, including having post buses meeting trains? Will not all those efforts be entirely destroyed if major railway lines, such as those between Newcastle and Edinburgh and Newcastle and Carlisle, are closed?

I hope that the hon. Gentleman was in the Chamber earlier when I made it clear that wild, speculative statements had been made about the railway system. My right hon. Friend the Secretary of State will deal with aspects of the Serpell report in reply to a later question.

Will my hon. Friend, for the encouragement of others, publish information about the participation of private operators for the benefit of rural areas, including Essex and Epping Forest?

My hon. Friend makes a good suggestion. My Department is extremely active in encouraging county councils to consider various modes of unconventional transport arrangements to assist in dealing with problems in rural areas. We shall give serious consideration to my hon. Friend's suggestion.

Can the Minister give information about one rural area—Suffolk? What is the result of the Department's opinion on the inquiry into the western section of the Ipswich bypass? Will there be an announcement in the near future?

That is a road matter for which my hon. Friend is responsible. She will write to the hon. Gentleman.

Serpell Report

6.

asked the Secretary of State for Transport if he will make a statement on the Serpell report.

7.

asked the Secretary of State for Transport what action he intends to take on the recommendations of the Serpell report on British Rail finance.

10.

asked the Secretary of State for Transport if he will publish in full the report of the independent committee to review British Rail's finances, chaired by Sir David Serpell.

12.

asked the Secretary of State for Transport when he will now publish the Serpell report on British Rail.

13.

asked the Secretary of State for Transport if he will make a statement on the Serpell committee's report on British Rail's finances.

14.

asked the Secretary of State for Transport what action he intends to take on the recommendations of the Serpell report on British Rail finances.

The full reports and detailed supporting work of the Serpell committee will be published tomorrow at 2.30 pm and will, of course, be available to all hon. Members at that time. I also hope to make a statement to the House then.

Order. I propose to call first the six hon. Members whose questions are being answered.

Does my right hon. Friend agree that it is thoroughly unsatisfactory that the press has analysed, and the British Railways Board has discussed and apparently rejected, the contents of a report that the House has not seen? My hon. Friend the Under-Secretary of State has this afternoon said that the speculation has been wild and deplorable and wild and speculative. Is my right hon. Friend aware that that is because we have not seen the report and have had to rely on rumour to know what has been happening? Before the recess I suggested that it would be in the Government's interest to publish the report, without comment, so that all hon. Members could have an equal opportunity to read it. May we look forward to a change in procedure?

I wholly agree with my hon. Friend that the alleged leaks and speculation have been deplorable. The comments have been speculative and grossly distorted in many cases. As soon as the manuscripts of the report were received, I informed the House and authorised publication. There are many maps in the supporting documents and publication was not physically possible before tomorrow, when the full documents will be available to hon. Members.

Manuscript copies were sent to the British Railways Board on a confidential basis as soon as I received them. It was right to do that, as the report obviously concerned British Rail and its operations. Those were the only manuscript reports circulated outside the Government.

Is the Secretary of State aware of the wide revulsion in all sections of the community towards the contents of the Serpell report so far leaked, especially the part that recommends wholesale closures by British Rail? Will he confirm his predecessor's view that Beeching-style cuts in British Rail would be a disaster and give the House a clear undertaking that he will loyally uphold his predecessor's decision?

I repeat that the speculation is, in many cases, wholly and wildly inaccurate. I ask the hon. Gentleman to await the report and documents, which will be published in full tomorrow, and also my statement, and not to make the mistake of some right hon. and hon. Members, who rushed to condemn the report before they could carefully study the substantial work involved.

If the Secretary of State is so certain that the comment has been wild, will he give an absolute guarantee that no suggestion that in any way damages British Rail Engineering Ltd. will be accepted by him? Does he accept that it must not be privatised or sold, and that the degree of engineering expertise available to it is one of the strongest cards held in Britain? Should we not do everything possible to encourage it and its export markets?

The hon. Lady will have the full report in her hands soon. I ask her to await it and to study it. She will find much valuable information in it on that subject.

Is my right hon. Friend aware that I share the disappointment of my hon. Friend the Member for Christchurch and Lymington (Mr. Adley) at the manner in which publication of the report has been handled, because any leakage of whatever dimension would seem to have come from the railways side? In view of the great uncertainty that the leakage has created about the future of rural railways, electrification and many other matters, does my right hon. Friend agree that it behoves British Rail to work in conjunction and co-operation with the Government rather than to seek to box them in.

I have expressed my strong feelings about all the speculation that has taken place. Some have described it as "astute", but I believe that it is counterproductive and highly damaging to the future interests of the railways and their users.

What useful purpose has been served by delaying publication of the Serpell report until tomorrow? As the right hon. Gentleman has said that many reports have been inaccurate or misleading, will he tell us whether the reports that one of the options was a 40 per cent. increase in commuter fares and that options for substantial cuts in the network were inaccurate? If those reports were inaccurate, will the Secretary of State give a clear assurance that the Government have no intention of proceeding with any proposals on those lines?

There has been no delay in the publication of the substantial reports and detailed supporting work. They are to be made available to Members of the House at 2.30 pm tommorrow, which is the first time that it is physically possible for them to be made available in printed and published form. There has been no delay at all in these matters.

As for inaccuracies, of which the right hon. Gentleman has just repeated one or two, I repeat what I said earlier. To go on record condemning a report before there could possibly he time for it to be published and studied seems to me to verge on silliness.

Does the right hon. Gentleman accept that if the Government carry out any part of the leaked report—I stress "leaked", because none of us has seen the printed report—or instruct the railway authorities to carry out its recommendations, it will be a virtual death sentence for the railway system as we know it? In view of the intense interest of the nation in this matter, will he give an undertaking today that, following publication of the Serpell report, there will be a full day's debate on the subject in the House?

I ask the hon. Gentleman, who has considerable experience in these matters, to await the full report and the supporting detailed analysis, which I believe he will find extremely interesting and valuable. I have no doubt that he will have the opportunity, which will be welcomed by many, to participate in the invormed public debates and discussions everywhere on the issues involved when the report has been published.

Is my right hon. Friend aware that one aspect of the Serpell report that has leaked out is that commuters in the south-east, several thousand of whom are my constituents, will have to pay as much as 40 per cent. more to get to work in London? I hope that when my right hon. Friend has had a chance to study the report he will quickly scotch that rumour.

That is among the many speculations that have been made. As I have said, they are widely inaccurate. I assure my hon. Friend that when he has the opportunity to study the report fully—it will be published in full very shortly—he will discover that many of the so-called leaks are not leaks at all but manufactured speculations bearing no relation to what is in the report.

Will the Secretary of State incinerate the minority Goldstein report, which proposes that track product orders from British Rail be diverted to overseas producers, especially as the existing track producer in the United Kingdom in my constituency is highly competitive in international markets and exports more than 60 per cent. of its total production? Is he aware of the resentment that this has created in BSC towards the Serpell report and its findings?

I do not think that burning reports is a healthy course to follow. As I have said before, the hon. Gentleman should await the full report and detailed supporting work, which will be in his hands very shortly, and then make his comments, rather than follow the foolish course of condemning the report before he has even seen or had time to study it.

When my right hon. Friend considers the options in the Serpell report, will he bear in mind that many Conservative Members have branch lines in their constituencies, such as the Harrogate-York line, which now carries 900,000 people and which, although loss making, we regard as crucial to the economy and to society?

I ask my hon. Friend to await the report. I am sure that he will find what it says about all these aspects valuable and useful.

Order. It is clear that there will be an opportunity for questions on the report after the statement tomorrow. I shall call one more hon. Member from each side and then move on.

Is the Minister aware that it is not our fault that today we can discuss only the report's antecedents and not its contents? Why was it thought appropriate for the firm of Travers Morgan to produce the report on British Rail Engineering Ltd. which would apparently decimate all the rail workshops in this country, in view of the malign influence of Mr. Goldstein on the committee?

I do not expect the hon. Gentleman to believe everything that he reads in the press. I hold him in higher esteem than that.

Experienced consultancy back-up was required by the committee, and it was considered by far the most efficient arrangement to appoint consultant firms which could work directly with the distinguished committee members.

Is my right hon. Friend aware that the availability of the report to hon. Members at 2.30 pm rather than 3.30 pm tomorrow is greatly welcomed by Back Benchers, but will he go the whole hog and make it available at 1.30 pm?

The volumes concerned are substantial. I wish to be absolutely sure that they are available in the Vote Office so that hon. Members may have the first opportunity to see and examine the considerable work involved.

Trunk Roads

8.

asked the Secretary of State for Transport how many miles of non-motorway trunk roads will be resurfaced in the current financial year, following the transfer of another £20 million to the trunk road maintenance budget.

The resurfacing of non-motorway trunk roads involves a great number of individual schemes every year. The lengths and widths of road resurfaced vary widely. It is not therefore possible at reasonable cost to express those schemes in terms of a single mileage for 1982–83. However, as a result of the transfer of the £20 million to the trunk road maintenance budget, a total of £56 million will be spent in 1982–83 on non-motorway trunk road structural repairs.

What proportion of the total road budget does that represent? As non-motorway trunk roads carry a far greater proportion of traffic than motorways, does the hon. Lady envisage any further transfer in the near future?

The increase from £36 million to £56 million is more than 50 per cent. for the non-motorway trunk road budget. I believe that with current spending the figure is now about 40 per cent. I shall let the hon. Gentleman have the exact figure.

Will the modernisation of non-motorway trunk roads provide an opportunity to improve the general facilities on those roads, which are at a very low level compared with those of our European counterparts?

I am aware that facilities on many non-motorway trunk roads are lacking. I have been considering for individual roads schemes for the provision of toilets and safe stopping places in addition to parking areas. I emphasise, however, that, especially where a road is not a dual carriageway, the safety aspects of exit and entry must be considered.

Metropolitan Counties (Public Transport)

9.

asked the Secretary of State for Transport when he next expects to meet representatives of metropolitan county councils to discuss public transport.

My right hon. Friend and I are open to further meetings and have welcomed the useful discussions that have already taken place, including those with West Yorkshire.

When the Minister meets those representatives, why does he not take notice of what they say? Does he understand that all the metropolitan county council representatives are totally opposed to the imposition of the transport guidelines in the Transport Bill, wish to see local authority democracy retained and thus have the right to determine their own public passenger fare levels? Does he not understand that when the metropolitan county councils are forced by the viciousness of his legislation to increase fares, it will be entirely because of the Conservative Government imposing their jackboot heel policies on local authorities?

Arrangements for services and fares are the responsibility of the PTAs. It is good that the wider allegations that we used to hear are being made much less frequently now. Furthermore, the final decisions on services and fares that are to be charged in these areas will be made by the local authority, which contradicts the allegations that the hon. Gentleman has constantly made.

In any discussions on public transport with representatives of the metropolitan counties, will my right hon. and hon. Friends bear in mind that this year London Transport will receive subsidies totalling no less than £290 million, which represents 36 per cent. of its total costs? Will he also bear in mind that many Londoners believe that the capital city, in receiving 45 per cent. of the total transport supplementary grant next year, is being fairly and favourably considered?

I am grateful to my hon. Friend for mentioning those favourable factors affecting London. Central Government provides 40 per cent. of the total subsidy that my hon. Friend mentioned. That is equivalent to 15 per cent. of the total cost. That shows how grotesquely wrong is the 3 per cent. figure which the GLC has quoted in some of its misleading propaganda.

The Minister will accept that it is vital that discussions take place with the metropolitan and non-metropolitan counties. At least that is a bonus, whether the Government take notice or not. Nevertheless, rail is an important part of public communications and concerns these county authorities. If the Minister is discussing these matters with them, is it not right and proper that his right hon. Friend should say today that we will have a full debate on the Serpell report?

I have already given a full answer about the Serpell report. The hon. Gentleman is quite right to emphasise the importance of discussions with the metropolitan authorities. Those discussions are proceeding wherever possible and we welcome them. My right hon. Friend and I are quite prepared to receive further evidence which is relevant to the calculation of the protected expenditure levels.

Vehicle Testing Stations

11.

asked the Secretary of State for Transport if he has now concluded an agreement with Lloyd's Register on the future of heavy goods vehicles and public service vehicles test stations.

Discussions with Lloyd's Register of Shipping are at an advanced stage but we are not yet in a position to announce final agreement. I hope to be able to come to the House with further news soon.

Is the Minister aware that she is in grave danger of tedious repetition by coming to the House month after month saying that she hopes to announce agreement soon? Why are the discussions taking so long, especially since the most recent Transport Act was passed only because it was said that agreement would be reached soon? Will she give a categoric assurance that the terms and conditions for staff, including the entitlement to any redundancy payments, will be fully protected with regard to the state of those conditions as and when the Bill passed through the House?

If the hon. Gentleman continues to ask me the same question when he knows that proceedings will take a little longer, he will receive the same answer. However, I wish to reassure him that the terms and conditions available to vehicle testing staff are still under discussion. I firmly believe that it is important to get this right, which is perhaps why it has taken longer—since November when the Bill received Royal Assent—than the hon. Gentleman hoped for. We have made it clear that we shall consider the possibility of special compensation if, in the event, terms for transferring are significantly less favourable than those at present available. The question of redundancy procedures and payments should not thus arise for those who transfer.

Is the Minister aware that when she has to come to the House to give the same answer each time she does a great deal of damage to the morale of all those who work in the vehicle testing centres, who do not like and are unhappy about all the uncertainty? Is it not high time that she improved their morale by letting them know now where they stand rather than promising reports in the future?

This is the second month in which the hon. Member for Aberdeen, North (Mr. Hughes) has asked his question. I have said that we are proceeding thoroughly with these discussions because they are fundamentally important. I am afraid that I must disagree with the hon. Member for Stockport, North (Mr. Bennett). Morale is good in the heavy goods vehicle testing stations. We look forward to a continuation of their good work under the new system when the transfer takes place.

Rail Services (Privatisation)

15.

asked the Secretary of State for Transport what consideration he is giving to privatisation of any of the services provided by British Rail on passenger trains.

I understand that the Railways Board is considering the scope for private involvement in train catering on a number of services. I welcome this.

Will the Secretary of State give an assurance that the removal of sleeper cars from the intercity services to Liverpool and Manchester has not been done as a first step to their privatisation? Does he not realise that handing over Britih Rail catering to private firms will only provide a service as efficient, cheap and wholesome as that provided at the motorway service stations?

The operation of sleeper car services is a matter for the chairman of British Rail. With regard to British Rail catering, it would be fair to say that, like the curate's egg, it is excellent in parts.

Will my right hon. Friend not only welcome British Rail's examination of privatising catering but encourage it to proceed more quickly?

Will the Secretary of State urge British Rail to look seriously at the privatisation of southern suburban commuter services? We understand from the Serpell report—albeit the leaked Serpell report—that there is massive feather-bedding of commuters living in the south of England, to the detriment of those living everywhere else in the country.

The hon. Gentleman has been feeding himself with inaccurate speculation. I advise him to await the report.

Is it not the case that motorway catering and service standards have improved enormously since privatisation?

Yes, it is. We have many instances where privatisation has greatly increased the efficiency of the service provided.

Will the Secretary of State accept that any privatisation consideration within British Rail is entirely a part of the economic consideration of British Rail's future?

Against the background of the economies and economic considerations of British Rail, is the right hon. Gentleman prepared to have the Serpell report, which is an economic consideration of British Rail, debated in the House?

The final decisions on debates must be for the Leader of the House. He will have noted what has been said. It is an immensely important and valuable report, which will be available to us shortly. I am sure that it would be right for the House and the public to have full opportunities for debate. My right hon. Friend will take note of what has been said.

Motorways (Traffic Flows)

16.

asked the Secretary of State for Transport which sections of motorways have average daily traffic flows in excess of their design standards.

As I explained to my hon. Friend the Member for Ashford (Mr. Speed) on 30 April 1982, we no longer work to design standards which are fixed in relation to traffic flows; so I cannot specify the degree of excess flows in the way requested. We recognise that delays can occur when traffic flows reach a certain level, which varies according to local circumstances, and traffic flows can attain these levels for short periods during peak hours on certain sections of MI, M4, M5, M6, M62 and M63.

Bearing in mind the high cost of disruption that repairs of these motorways cause, is any consideration being given in the design of future motorways to extend the design life, which at present is, I understand, about 20 years?

In the current year we have reduced the delays due to motorway repairs. Our current practice is to adopt a design life of 20 years for new bituminous roads and 40 years for new concrete roads. In determining the strength of a road we take into account the level of future traffic, which is always uncertain, and the capital cost of provision. Varying strengths of roads have been monitored over the years by the TRRL and this work provides a good basis for decisions. We are considering the design life criteria, because I believe that it is high time that they were reviewed.

As traffic flows on Britain's motorways have consistently failed to match those projected by her Department's civil servants before construction, will the hon. Lady consider referring these sections of motorway to Sir David Serpell with a requirement that he treat them in exactly the same way as he treated the railway system, and close them down?

The hon. Gentleman is requesting detailed knowledge, for which I must ask him to give me notice. Problems have occurred when flows have been higher than those anticipated 20 or 30 years ago. Where possible, hard shoulders have been strengthened so that they can take running traffic during repair periods. This is already being done. Many new developments that are available through new technology are being carried out very well and efficiently by officials in my Department as well as by many British construction companies, of which we are proud.

When my hon. Friend arranges for surveys to be undertaken on trunk roads and motorways in the west country, will she please ensure that the times and dates upon which the surveys are conducted take proper account of the abnormal seasonal traffic flows to the west country? Will she ensure also that these statistics feature in her deliberations on whether further extensions are necessary?

We shall do that, because no survey is correct unless it views an entire year. Traffic flows in different areas peak at different times.

If design factors are not related to traffic flows, is that why we have at the beginning of the M1, which caters for the Midlands, a motorway network that is continually in a state of repair, with one-lane traffic causing tremendous confusion and accidents?

First, there have not been a tremendous number of accidents, but there have been far more than any of us would like. We must remember that the most southern part of the M1 is the oldest motorway in Britain, having been in use for more than 20 years and therefore requires restrengthening. The two-lane section is being brought up to three-lane standard and three lanes are now open on the southbound section. I assure the hon. Gentleman that where there is great peaking of traffic we can build to the best standard for the costs involved. We do not take traffic flows into account in isolation. We take into account, for example, the cost of widening. A good example is the M4 elevated section, which has extremely high traffic flows. The cost of widening that section would be so prohibitive that it would not make sense.

British Rail Engineering Ltd

17.

asked the Secretary of State for Transport if he will meet the chairman of the British Railways Board to discuss the future of British Rail Engineering Ltd.

This is among the matters the chairman and I will be discussing in the light of the Serpell committee's reports.

The Secretary of State will be aware that the British Railways Board withdrew the closure notices that were placed on Shildon, Swindon and Horwich in my constituency last year. Will he make a clear and unequivocal statement that he will ignore the leaked recommendations in the Serpell report to close down or to sell off British Rail workshops, especially those in Shildon, Swindon and Horwich? He must be aware that the closure of these workshops would represent a disaster for those towns, which depend on the workshops for what little employment still remains.

The problem of British Rail Engineering Ltd.'s costs and capacities is one that has worried hon. Members and there has been concern in the industry for some time. The problem remains. In the light of the Serpell report and the debates that will follow, there will be important new information and important matters to discuss. I ask the hon. Gentleman to await the full report, which will shortly be with him, when he will find that he will be able to make a full contribution on the issue that concerns him.

Is the right hon. Gentleman aware that the problem of the workshops is not that there is insufficient work to be done? There is much work to be done on the railways to renew the clapped-out system and those who are employed in the workshops are only too ready and willing to undertake it if the right hon. Gentleman will only make it possible financially for them to do so.

I wish that were so, but in some instances there is no longer a demand for equipment that was manufactured in the past on any of the world's railways, including British Rail. I want to see more investment in British Rail. The external financing limit that has already been announced for next year will allow an increase in the scope for investment, which I welcome. The higher the investment the more effective British Rail will be in cutting costs. The draining away of vast sums on futile strikes last year has not set a very good position for the future.

As I come from Shildon—I was born there—may I ask my right hon. Friend whether the product line in Shildon is good enough for most of the markets around the world? If it is not, are there any means by which a new line of development can be started in the Shildon works?

These are matters which I know the chairman and board of British Rail have been considering carefully. There are problems of capacity and of making the equipment that is now needed. I know that British Rail's staff and chairman are considering these matters closely.

Will the right hon. Gentleman bear in mind that the Glasgow, Springburn workshops are the only British Rail workshops left in Scotland? In the community that I represent the unemployment rate is over 30 per cent. If anything happens to the workshops, a community will be destroyed. The only area in which apprentices are being taken in at present is that of the British Rail workshops. If they close, we shall be destroying the future for young people in the community that I represent.

I am sure that the social implications as well as the economic ones of a changing industry and its problems will be carefully borne in mind, as in the past, by the British Railways Board.

British Rail (Investment)

18.

asked the Secretary of State for Transport when he next intends to discuss British Rail's investment programme with Sir Peter Parker.

19.

asked the Secretary of State for Transport when he next expects to meet the chairman of the British Railways Board to discuss investment in the railways.

I meet the chairman frequently to discuss matters of mutual interest.

Is the Secretary of State aware that rail users can now see for themselves the deterioration in the railways that has been caused by his policies, and that most Members know that railway investment programmes in their regions and constituencies could bring men back to work and improve the service? When he sees the chairman, will he make it clear that for most rail users the only post-Serpell resignation that they will want is his own?

The hon. Gentleman should think also about the colossal contribution that taxpayers make to support the railway system and the concern that the traveller and taxpayer have not necessarily been getting value for money. These were the matters that led British Rail eagerly to seek the Serpell review and to welcome the members of the committee when it was set up. These were the factors that led it to take the view that the review was needed. In the light of the review, I believe that the debate will be carried forward.

When the right hon. Gentleman next meets the chairman, will he please receive sympathetically the application that British Rail Sealink has made to him to be given sufficient money to put in an order for the replacement of passenger boats on the Rye-Portsmouth route? He will be delighted to know that next month, for the second or third year in succession, we shall go back 50 years when we start to go over to the island on a car ferry on which we shall be exposed to all the elements. May we please have priority given to our replacement boats so that some business is given to us on the Isle of Wight?

When my right hon. Friend meets the chairman, will he urge him, whatever else he does, to sell Sealink?

It is the present intention of the board to try to sell the Sealink subsidiary.

Serpell Report

20.

asked the Secretary of State for Transport what discussions he has had with the railway trade unions on the report of the Serpell committee on British Rail finances; and if he will make a statement.

None. I shall welcome the views of all parties when the reports are published.

Am I indulging in idle speculation in saying that the Serpell report proposes a reduction in the railway network of 1,600 miles, a reduction in safety standards for British Rail, the parcelling up and selling of British Rail Engineering Ltd. and substantial fare increases for commuters, especially in London and southeast? Am I speculating, or is that what is contained in the report?

Civil Service

Civil Service Unions (Meeting)

45.

asked the Minister for the Civil Service what subjects he proposes to discuss at his next meeting with trade union representatives of the Civil Service.

Plans for my next meeting with the Civil Service unions have not yet been made.

Will the Minister discuss the need to improve staffing levels, especially in the Department of Health and Social Security and in employment offices, so that a better standard of service can be provided to the increasing number of unemployed who must often queue for ages for the payment of benefit to which they are entitled? Why is there a shortage of staff to help the unemployed, while extra staff seem to be recruited to special investigation squads that simply hound and harass the unemployed?

Extra staff have been employed both in unemployment benefit offices and in the DHSS, but the detailed arrangements are the direct responsibility of my right hon. Friend the Secretary of State for Social Services.

Has progress been made in the consideration of no-strike contracts in the public service?

My hon. Friend may remember that those matters were dealt with in the Megan commission report. He will also know that negotiations with the unions on the basis of the recommendations of that report are now starting.

When the Minister meets the trade unions, will he discuss the unfortunate position whereby civil servants cannot take complaints to the ombudsman? One example is the recent case in my constituency of Mr. Alastair Dewar, where there was an admitted failure by the Department. Mr. Dewar asked the ombudsman to consider his case, but the ombudsman could not do so. Does that not restrict the civil rights of some of our citizens by not allowing them to make complaints to the ombudsman?

I am prepared to discuss the matter with the unions if they so request, and I shall examine the point raised by the hon. Gentleman.

When the Minister meets the unions, how will he reconcile his assurance that there will be genuine negotiations in this year's pay round with the Government's even stronger commitment to a 3½ per cent. cash limit? Will he admit to the House that the Government are operating an incomes policy for the Civil Service and that since the previous pay comparison in 1980, whereas prices have risen by 32 per cent., Civil Service pay has risen by 14 per cent., which is a shortfall of 18 per cent.?

The Government have made it clear, for this year's pay negotiations with the Civil Service, that the 3½ per cent. figure is part of the public expenditure planning process for this year. The Government believe that to be a reasonable provision. Rateable inflation is already much lower than it was at this time last year. There is no reason why the announcement of the 3½ per cent. figure should preclude genuine negotiations. It is neither a pay norm nor an entitlement.

Efficiency And Effectiveness (White Paper)

46.

asked the Minister for the Civil Service what role the Management and Personnel Office is playing in assisting other Departments in preparing responses to the White Paper on efficiency and effectiveness in the Civil Service.

As explained in the White Paper, the Management and Personnel Office is directing the financial management initiative jointly with the Treasury. MPO staff are fully involved in the joint steering machinery, which has issued guidance to Departments and which will examine the responses. The MPO is also helping Departments directly through the joint MPO/Treasury financial management unit, and has directed the 1982 review of running costs, the report of which will be available shortly.

In the direct assistance that the financial management unit is giving to Departments, can my hon. Friend confirm that special importance is attached to ensuring that Departments have proper management information and accounting systems? Is that not much more important than the rest of the financial management initiative?

I agree with my hon. Friend about the importance of the two matters to which he referred. I also welcome the constructive comments and encouragement in my hon. Friend's recent Bow group memoranda, which dealt with many of those matters.

Is the Minister aware that the real test of efficiency and effectiveness is what the public think about a service and the effect of that service on the public? Is he aware that, for example in my constituency, staff at the DHSS office has been reduced by three while the work load has increased by 50 per cent., thus hurting many people, especially claimants, in Swindon? Will he try to ensure that the Civil Service is effective at the point of use?

As I explained in answer to an earlier question, the details of DHSS offices are clearly a matter for my right hon. Friend the Secretary of State for Social Services. I do not agree that one should exclude cost effectiveness and value for taxpayers' money from considerations of efficiency in the Civil Service.

When replying to the White Paper, will the hon. Gentleman, as a Treasury Minister, outline how many of the savings claimed by Treasury Note 5 to the Select Committee have been lost to the Government in the form of tax that is no longer collected, national insurance contributions that are no longer collected, unemployment benefit that is paid to those who have been left in the dole queue instead of being recruited to fill the vacancies, and payments that are made to contractors who are carrying out the work that was previously done by civil servants? Is it not true that the net saving to the Government is a minute fraction of that which the Government claim?

I repudiate that statement. The reduction in civil servants has meant a net saving to the Government of about £½ billion a year on the pay bill, which is a substantial sum. Although extra expenditure is involved in some privatisation arrangements, overall the entire exercise has been good value for the taxpayer.

Ethnic Monitoring

47.

asked the Minister for the Civil Service when he expects to publish volume II of the survey in Leeds on ethnic monitoring in the Civil Service.

The results of the job applicant part of the Leeds survey, which ran from 1 May to 30 September last year, should be ready for publication in March.

Does the Minister recognise the great urgency with which the work should be completed, along with the approval of the CRE code on ethnic monitoring, which awaits the approval of the Secretary of State for Employment, and the need for safeguards against misuse of the information, as recommended by the Select Committee on Employment? Will he assure the House that he is receiving the full support not only of the unions but of all communities such as those in Leeds and Leicester, where community relations have been remarkably good, although the ethnic minorities are very large?

I assure the hon. and learned Gentleman that the work carried out in the Leeds survey followed consultation with the unions and was carried out in cooperation with them and with their full support. The code of practice issued by the Commission for Racial Equality is a matter for my right hon. Friend the Secretary of State for Employment, who hopes to announce his decision on the matter soon. I agree with what the hon. and learned Gentleman said about the necessity to safeguard the confidentiality of information collected as a result of ethnic surveys and to ensure that it is not improperly used.

I am pleased to hear the Minister's reply. Will the Government take note of the experience of the city of Leeds, which has adjusted itself to absorb immigrant communities—Irish, Jewish, Italian, Central European and Asian—and which has had no problems? I hope that as a result of the inquiry conducted by the Minister, his colleagues and the Department, other British cities will learn from the experience of Leeds to absorb those communities without serious problems.

The hon. Gentleman's supplementary question goes somewhat wide of the survey of civil servants in Leeds, but I am delighted to hear what he has said and I am grateful to all in Leeds who made the carrying out of this survey so effective.

Does the Minister agree that the high participation rate shown in volume I of the report shows that it is feasible for widespread ethnic monitoring to take place throughout the Civil Service? How soon will the Minister be having meetings with the unions to ensure that the successes of Leeds can be repeated throughout the country?

As I explained in the answer to the main question, we are awaiting the second part of the survey, which, I hope the hon. Gentleman will agree, is an important element in it. It would be wise to await decisions and considerations of what should be done in the future until we have the full information.

Council Of Agriculture Ministers

3.31 pm

With permission, Mr. Speaker, I should like to make a statement on the meeting of the Council of Agriculture Ministers on 17 and 18 January in Brussels. I represented the United Kingdom, together with my right hon. Friend the Minister of State.

The Council had its first discussion upon the Commission's price proposals for 1983ߝ84; proposals that recommend an average of 4·4 per cent. increases in farm gate prices, which for British agriculture would work out at 4·1 per cent.

A diversity of views was expressed by member States, the majority of whom sought higher increases than those proposed by the Commission in view of the projected 9 per cent. rate of inflation for the Community as a whole.

The British Government expressed the view that this was a time for price restraint, particularly for those commodities in structural surplus.

The proposals will now be referred to the special committee on agriculture and the Council of Ministers will resume its discussions at future meetings.

The Council agreed to an extension for a further month of the regulation that enables New Zealand to export butter to Britain in accordance with the 1983 quotas, agreed by the Council at its meeting last October.

The French and Irish Governments retained their reserve on the ratification of this agreement, stating that they were linking their ratification with an examination of the manner in which the Soviet Union was being treated in the tendering for butter stocks. The United Kingdom Government, supported by other Governments, the Commission and the Presidency, made it quite clear that the New Zealand quotas of butter, as agreed last October, will be maintained.

I recognise that this is a very interim statement.

This may be a useful opportunity for the Minister to make it clear that there will be no restriction in relation to any other trade-off for the full import of New Zealand butter. That has been agreed and is supported by the whole House, and we shall not tolerate any other trade-off for reneging on that agreement.

What does the phrase mean about the French and Irish Governments
"linking their ratification with an examination of the manner in which the Soviet Union was being treated in the tendering for butter stocks"?
Who will be examining it? Does it mean merely the Irish and the French, or will the Council or the Commission become involved? What will they be examining? Is there any explanation of what they are looking for, and if so, are they looking for some other type of trade-off? When are they likely to report on it?

I am pleased to see that at long last the right hon. Gentleman is recognising that this is a time for price restraints. However, does the phrase in the statement about price restraint mean that the Government are reverting to the policy that they pledged in their manifesto for the last general election, that there would be no increase in price for those commodities in surplus production? If the right hon. Gentleman is sticking to that, the Labour Party will back him on it.

Is the right hon. Gentleman clear that there must be no overruling this time of the British position in relation to the majority votes? The Labour Party would back the right hon. Gentleman on that. If this is pushed to the uttermost and these demands for something equivalent to 9 per cent. inflation are argued in terms of prices by our European partners, I trust that the right hon. Gentleman will oppose that as much as possible, to the extent, if necessary, of using his veto at the end of the day.

I welcome the remarks of the hon. Member for Renfrewshire, West (Mr. Buchan) about butter. I can categorically state that this has been agreed by all member countries. There is no way in which we would accept any restraint upon the quotas agreed for New Zealand butter, and there is no question of trading anything else off for it. We have the support of the Presidency, of the Commission and of the other member states, with the exception of France and Ireland.

As for the tendering arrangements affecting the Soviet Union, the Soviet Union has been as free as other countries to tender under these arrangements and has failed to do so. This might be disappointing to the French, who, we gather, would have been happy to export substantial amounts of butter to the Soviet Union, and whose agriculture Minister was in Moscow some time ago. It is a fair tendering system, and the Commission made that perfectly clear yesterday. However, the Soviet Union failed to tender.

It is a question not of anybody else examining the system, but purely of the Irish and the French saying that they feel that there is a bias against the Soviet Union in the system. It was made clear by the Commission that that was not so. The French Minister changed her tone on the second day of the Council from what it had been on the first day.

On the general question of price restraint, one of the major items in surplus during the period of this Government was milk, for which price-fixings have meant in real terms a 17 per cent. reduction on the price inherited from our predecessors. I am afraid, as the hon. Gentleman I hope recognises, that even with a 17 per cent. reduction over the four price reviews for which this Government have been responsible, there has not been a reduction in production. There is a tendency, if the price is restrained, for people to have more cows, and production is, if anything slightly increased.

The 9 per cent. that I mentioned in the statement refers to the rate of inflation in Europe. In fairness, other than comments by perhaps the Greeks and Italians on one or two Mediterranean commodities, no such high figure has been suggested. The figure suggested by one or two other countries was in line with what certain agriculture organisations have suggested, which is about 1 or 2 per cent. above what the Commission expected.

With regard to the Luxembourg compromise, we adhere to the view that it remains, and has an important role which we have a right to exercise in any matter of national interest. I noted that after it was breached on the previous occasion, two of the member Governments who breached it immediately issued a declaration saying that from now on they would adhere to it. I trust that they will.

Does the Minister believe that the pitifully low increases proposed today will satisfy the financial needs of agriculture in Britain? Will it stem depopulation of the land? How much have the costs of production gone up in the past 12 months?

I am pleased to say that in 1982, partly because of good weather conditions, there has been a recovery from the drop in real farm incomes that took place between 1978 and 1981. That has been good for the economy as a whole because it has meant an increase in investment in the construction and machinery industries, which I welcome.

We have the benefit of high standards of productivity in British agriculture, and our application of technology and plant and animal breeding is such that each year there is an improvement in productivity that assists in tackling problems. I expect that to continue. I hope, too, that improvements in marketing of British produce will help. It is reasonable, therefore, to have tolerably restrained price increases this year.

Does my right hon. Friend agree that it is not in the long-term interests of farmers, let alone British consumers, to have an excessive price settlement agreed at the end of March, and that, conversely, as my right hon. Friend has recognised, too low a price settlement or a freezing may result in overproduction as farmers try to catch up on their income? Therefore, does my right hon. Friend accept that many of us feel that he has it absolutely right and hope that he will stick to his guns?

I am very grateful to my hon. Friend. It is worth pointing out that during the past three or four years we have, in comparison with most of our competitors, done very well in agriculture. It is also a period when the record on low food price increases has been remarkable. I am glad to say that, for example, food price increases during the lifetime of this Government have been well below half the rate of those under the previous Government.

Order. This is an Opposition day. We have a ten-minute Bill before we come to the privilege motion. I shall call hon. Members who have been rising in their places and then move on to the ten-minute Bill.

The Minister said in his statement that milk production had not fallen. If, during the negotiations or subsequent ones, it is decided to follow the admirable example of the Christmas butter subsidy, and give an extra subsidy to citizens of the Community, will my right hon. Friend do his best to make sure that sufficient time is given for distribution arrangements, so that no hold-ups occur, as on the last occasion?

The arrangements for the Christmas butter subsidy were a bad way of encouraging consumption. That was a matter for the Commission. The British Government expressed the view that it would be better to increase generally the butter subsidy over a longer period than to have a once-for-all injection. I am sure that that is right. That is why I am glad that in the lifetime of the Government we have succeeded in doubling the general butter subsidy.

I am pleased that the Minister has dug his heels in over New Zealand butter and farm prices, but does he agree that there is no long-term solution for the common agricultural policy problems while we remain members of the Common Market? Does he agree that the real solution to the problem is to get out of the Common Market?

I suppose that, more than any other hon. Member, I am acquainted with the detail, difficulties and problems of the CAP. Most other parts of the world would like to have had the stability of prices and guarantee of supply that Western Europe has enjoyed.

Does the Minister accept that the National Farmers Union will regard his attitude to prices with dismay and that it will find it hard to understand how he was prepared to accept institutional price increases last year of 10·4 per cent. while this year he is apparently boggling at the Commission's proposal of 4·1 per cent.? As farm incomes have not recovered to the mid-1970s level, will the Minister think carefully before bringing the modest farming recovery that took place last year to a juddering halt?

The hon. Gentleman has made an interesting statement on behalf of the alliance. The NFU will be interested in statements from his partners in the alliance about the re-rating of agricultural land. Any dismay that the NFU has about me is as nothing compared with its dismay about the ignorance of the Social Democratic Party about agricultural matters.

Will my right hon. Friend state what agricultural commodities do not have direct price support under the proposals, such as turkey meat, which could be bought last year at the same price in cash terms as 30 years ago?

There have been considerable changes in the poultry industry over the past 30 years. The consumer has benefited. A large range of foodstuffs are unaffected by CAP price fixings although most British foodstuffs are—for example, cereal prices affect the poultry industry.

Does the Minister accept that British farming is not the main culprit for structural surpluses of agricultural commodities? Will he therefore take steps to ensure that British farming does not suffer unduly, if at all, from penalties for excess production?

Yes, Sir. That is why I am pleased to say that in the lifetime of the Government we have improved the share of the home market produced by British farmers so that this year our balance of payments will be £1 billion better than it would have been otherwise.

Although I welcome, unlike the Social Democratic Party, the Minister's attempts to curb excessive food price rises, does he agree that even that restraint will not solve the problem of the growing structural surpluses in the Common Market, particularly now that the Americans are matching the dumping of food in the Middle East and elsewhere? Did any new thoughts emerge from the meeting about what to do with those large and growing surpluses? What would the Government do if the Council of Ministers overruled him and forced through a large price rise, as it did last year?

As I have said, I believe that the Luxembourg compromise will prevail in the countries that used it last year, so they will adhere to it this year. With his views on Europe, my hon. Friend will have noted the big reduction in the major surpluses in the European Community. All I can say is that a pricing policy which would diminish returns to a level where European farmers came out of production would result in a swift rise in world prices. The comparison with world prices that some people use is artificial and wrong.

Is the right hon. Gentleman aware that I have a considerable interest in New Zealand butter as we pack a good proportion of Anchor butter in Swindon and that for that reason I support the tough and forthright attitude that he has taken with the French? However, as so often in the past, tough and forthright attitudes come to naught, as happened in the price review last year. Therefore, will the Minister give the absolute assurance that under all circumstances we shall import 89,000 tonnes of New Zealand butter this year? How long will that agreement run?

The figure is 87,000 tonnes. It is this year. I give the assurance that the hon. Gentleman requires.

Does my right hon. Friend accept that this is probably one of the best farm price reviews that has come from the Commission in the past few years? What does he think will be the likely food price increase once the final negotiations have been concluded?

The relationship between the food price increases and the farm price increases is not substantial. Food prices this year have continued to increase less than the retail price index. The increase has been less than 5 per cent. whereas last year there was an increase of over 10 per cent. in farmgate prices. We have a whole range of disagreements on individual items. It will be possible to calculate the impact when we have looked at the increases for each item.

Does the Minister regard the Commission's price proposals as constituting price restraint? Does he regard it as an important national interest that we should get price restraint on products in structural surplus? If those price proposals are adopted, what will be the effect on Britain's contribution to the Community budget?

The last point depends totally on the method of calculation of our budget contribution for the coming year. That has yet to be negotiated. I can only say—I know that it will bring great joy to the hon. Gentleman—that the proportion of the CAP budget that benefits British agriculture has doubled during the lifetime of the Government. Therefore, we are obtaining much more benefit than our predecessors managed to obtain from the system. Part of that is directed towards the consumer in the doubling of the butter subsidy that the Government have achieved. Price restraint varies from one commodity to another. It depends upon productivity. In some areas a policy of price restraint is illustrated. For example, if one takes the price proposals combined with the suggestions on green currency proposals for a number of countries, the proposed price increases are way below the rates of inflation and increased input costs in those countries. It varies from one commodity to another. I repeat that I am happy to compare the Government's record in the past few years on food prices with that of any of our Socialist predecessors.

Rent (Agriculture) (Scotland)

3.47 pm

I beg to move,

That leave be given to bring in a Bill to provide security of tenure for tenants of agricultural tied cottages in Scotland.
A farm worker and his family in Scotland have no legal right to a roof over their heads. If the farm worker ceases to work on the farm, through ill health or retirement or as a result of a dispute with the farmer, the farmer has a right to secure vacant possession of the cottage. It is true that he must go to court to obtain an eviction, but in practice it is automatic. The farmer's motives are irrelevant. The farmer's intentions for the cottage are also irrelevant—whether he needs it for another farm worker, wants to sell it, let it as a second home or allow it to stand empty. It is an elementary act of social justice that that fundamental insecurity should be ended.

The purpose of the Bill is to give tenants of agricultural tied cottages broadly the same security of tenure as other tenants under the Rent Acts. It often makes sense for a farm worker to live in a cottage on a farm. In remote parts of Scotland there is little alternative for the shepherd or other workers but to live on a farm.

When a farm worker ceases to work on a farm, he may no longer wish to continue living in his tied cottage. He may wish to move into alternative accommodation in a nearby village provided by the council. The Bill will impose on local housing authorities the obligation to provide alternative accommodation where there is a genuine need for a cottage for an incoming worker.

The farmer would no longer be able to secure vacant possession automatically. The only arguments relevant to securing possession would be those related to the housing needs of the ex-worker and his family.

The Rent (Agriculture) Act 1976 provides security of tenure for farm workers and their families in England and Wales. As with all reforms of this nature, that measure was opposed by the Conservative party and by the National Farmers Union. The present position has worked well. It has been accepted by the National Farmers Union, and the Government have acknowledged that there is no need to alter it.

During the proceedings on the legislation, there were many scare stories about the implications for the practical working of our farms and the efficiency of British agriculture.

Where the agricultural dwelling house advisory committee recommends that a tied cottage is needed for an incoming worker, an obligation is put on the local authority to provide alternative accommodation. The legislation has worked very well. It abolished the insecurity and at the same time enabled a sensible arrangement to be reached between farm workers and farmers.

It may be argued that the legislation is not necessary because evictions from tied cottages are now relatively rare in Scotland. Evictions are the tip of the iceberg. The fundamental issue is that the farm worker and his family, or his widow, have no security to the roof over their heads. The question is not whether farmers are good or bad landlords. Most farmers are pretty good landlords. The issue is that the right of a farm worker and his family, or his widow, to the roof over their heads should not depend upon the benevolence of a good employer. That is why the Labour party, when it attains office, is committed to abolishing the insecurity of the agricultural tied cottage in Scotland. I hope this House will give leave to bring in this measure as an elementary act of social justice.

Question put and agreed to.

Bill ordered to be brought in by Mr. Gavin Strang, Miss Joan Maynard, Mr. John Home Robertson, Mr. Dennis Canavan, Mr. George Foulkes, Mr. William McKelvey, Mr. Martin O'Neill and Mr. Norman Buchan.

Rent (Agriculture) (Scotland)

Mr. Gavin Strang accordingly presented a Bill to provide security for tenants of agricultural tied cottages in Scotland: And the same was read the First time; and ordered to be read a Second time upon Friday 18 March and to be printed. [Bill 57.]

Privilege

Before I call the hon. Member for Hackney, South and Shoreditch (Mr. Brown) I must tell the House that I have received a letter from Mr. Ken Livingstone, headed

"Members Lobby, The County Hall, London"
I propose to read this letter to the House.

"Dear Mr. Speaker,
I understand from the media that some members of Parliament have raised an issue of privilege. I am enclosing a copy of the minutes of the GLC's Policy Committee which met on 12 January 1983 and decided:—
Agenda Item L(iv) Capital Allocation 1983/84
'…that lists be prepared of projects which are at risk in each constituency and that these be provided to MPs, who would be asked if they were willing to support an increased capital allocation for the GLC. It would also be made clear that decisions on which projects would proceed would not be based on how MPs voted but on the needs of London.'
You may also find helpful the press coverage of our press conference which preceded the Policy Committee (whose minute I refer to above) for although most papers give contradictory and confusing quotes both the Daily Telegraph and the Newsline both quote accurately the comment of John McDonnell:—
'…support us and we will implement this in your area, and your refusal to support our programme will mean this will not go ahead.'
You may also have seen an unusually accurate article in the Evening Standard which says:—
'Mr. Livingstone now claims that people "got the wrong idea" over remarks made by councillors. He said: "Of course the GLC will continue to allocate resources on the basis of need. To do otherwise would be to penalise the working people of London.'
I hope this letter will resolve an otherwise confused situation. I also hope that you will not mind my having given copies of this letter to the media as I am sure you will understand that there has been considerable media interest in our response to the issue raised in the House this afternoon.
Yours sincerely,
Ken Livingstone".

3.58 pm

I beg to move

That the matter of the complaint be referred to the Committee of privileges.
The purpose of my motion is to call attention to words spoken by Mr. Kenneth Livingstone, leader of the Greater London Council, and Mr. John McDonnell, chairman of the finance and general purposes committee of that body, indicating an intention to restrict the provision of new servuices in the constituencies of any London Member of the House who failed to support the provisions of a forthcoming Greater London Council money Bill.

I thank you, Mr. Speaker, for your courtesy in sending me a copy of the letter you have just read out, which I received this afternoon.

I had intended originally not to discuss the merits of this case as that is not the purpose of my asking it to be referred to the Committee of Privileges. I am not involved in the alleged threat because I have never voted against a money Bill since I have been in the House. I have no intention of voting against a money Bill. It is for local government to make and defend its own case.

I believe that it is in the interests of Parliament that hon. Members should never be put in a position such as this by anybody. There was a precedent in 1981 when an employer attempted to put pressure on a Member of Parliament. I submit that no one is in a position to offer any Member of Parliament money to vote in favour of a Bill, which is bribery, or to threaten to take action against him if he fails to vote in a certain way, which is blackmail. It is wrong to put pressure on a Member of Parliament in that way.

The press reports seem to suggest that pressure was being exerted. If the Committee of Privileges could examine this case hon. Members could be safeguarded from such pressure.

After hon. Members have voted, they must stand their corner. If an hon. Member has voted for or against a particular issue, he is subjected to all the criticisms and all the pressures from outside that anybody wishes to place on him. I accept, underline and approve of that behaviour, but the situation is different before the hon. Member votes.

The letter from Mr. Livingstone to you, Mr. Speaker, does have certain features about it and it goes some way towards clarification because it quotes from the agenda item, which was never quoted before. It says:
"It would also be made clear that decisions on which projects would proceed would not be based on how MPs voted but on the needs of London."
That was never quoted.

Another quotation which you, Mr. Speaker, also read out, purports to start with the word "support". However, the press report of what was said begins:
"We will be saying you either support us".
Those words are left our of the quotation given to you, Mr. Speaker, by Mr. Livingstone. The words put a different connotation on the point. The suggestion is that we either support the Bill or certain projects will not go ahead and that does not conform with the previous item on the agenda. The two items are incompatible.

Mr. Livingstone could have clarified another quotation which reads:
"We will write to every MP in London. We will put forward a positive victimisation policy. We will tell them what will happen if they do not support us."
I do not want to discuss the merits of the case. Your ruling yesterday, Mr. Speaker, leads me to believe that there is a prima facie case for giving precedence to the motion. I believe that it is right for the episode to be examined by the Committee of Privileges. When the Committee has reported to the House we shall be in a position to discuss the matter.

4.2 pm

Yesterday you, Mr. Speaker, explained to us that on the facts as given to you there was a prima facie case that could go to the Committee of Privileges. You did not say that the matter had to go to the Committee because the House would decide. That was yesterday. On the facts as we now know them a different situation has arisen. For that reason I would find it impossible to vote for the motion. I shall vote against it.

The motion is totally incorrect since it calls attention to words allegedly spoken by Mr. Livingstone, which he did not say, and which the hon. Member for Hackney, South and Shoreditch (Mr. Brown) admits he did not say. It refers to Mr. McDonnell, a councillor representing Hayes and Harlington. The Member who represents that area is the hon. Member for Hayes and Harlington (Mr. Sandelson), a distinguished member of the Social Democratic Party. If he voted against the Bill, Mr. McDonnell would have to penalise himself and his constituents. That would be nonsense, but he would have to do that if this matter were taken seriously. The House has a great deal more important work to do than to bother with this matter.

4.4 pm

As a London Member I wish to explain how the issue has affected me in a direct and personal way, which does not involve hearsay. Last Thursday I was invited to take part in a debate with Mr. Boateng of the GLC on a breakfast television trial run. Mr. Boateng put to me, in front of the cameras, what Mr. McDonnell had said. He said that in practical terms Mr. McDonnell had said that if I did not support the GLC money Bill, it was possible zebra crossings, among other things in my constituency for which the GLC has responsibility for erecting—slow though it is in doing so—would be at risk and would not be proceeded with.

I told Mr. Boateng that that was political blackmail against a Conservative Member of Parliament by the Labour GLC and unacceptable. He persisted in saying that that was what the GLC was saying to London Members such as me. A transcript will show that. I reminded Mr. Boateng that kings had fallen before the House of Commons on the question of Supply and that they should be careful. I repeat that warning to the GLC, Mr. McDonnell and anyone else involved.

4.6 pm

The remarks by the hon. Member for Hackney, South and Shoreditch (Mr. Brown) show what a charade and farce this whole business is. I speak as a Member who has been before the Committee of Privileges, so I know what I am talking about.

When an hon. Member is called before the Committee word goes round that if he grovels and apologises and says that it will not happen again he is bound over to be of good behaviour and nothing more is heard. Alternatively, the defendant can decide not to grovel but to go for the publicity and television cameras and take part in the charade.

The Committee of Privileges is the most unfair committee of inquiry in the British Isles today. The onus is put on the defendant to decide whether to make a personal appearance before the Committee. If he decides not to appear he submits his evidence in writing, a long and tedious business. If he decides to go before the Committee he faces top QCs and receives no legal aid or help with the cross-examination. There is no transcript or Hansard report at the end of the trial. The press and public are not admitted. The jury meets every Wednesday afternoon and can come and go as it pleases. It is not necessary for the same jury to be present at the same trial every week. The verdict is announced without the defendant being told.

I was severely censured by a Committee of Privileges when I alleged that MPs were making their services available for hire. Two years later three Members, Mr. Cordle, Reggie Maudling and the hon. Member for Normanton (Mr. Roberts) were found guilty. I was never pardoned. I did not receive an apology in any shape or form. There was no question of an apology.

In Britain we have freedom of speech. Mr. Livingstone was exercising his right to free speech. We have a free press. [Interruption.] Government Members who are shouting should look at the front page of today's Guardian which describes how the Soviet Union is putting Mr. Roy Medvedev on trial for criticising and slandering Soviet politicians. He could face seven years in prison. Will we get to that position here? The nonsense of referring matters to the Committee of Privileges just because someone feels aggrieved and wants to make a political point has gone on for too long.

The Diplock decision on political slander made in the House of Lords on 30 January 1974 states that if statements are made outside in the public interest by people who believe them to be true and believe that they have a duty to the public to say so, the privilege of free speech is not lost.

The GLC has the right to criticise the House of Commons and the right to free speech. It has the right to say what it likes about us. What the GLC advocates is no different from what the Government do when they give big grants to Tory constituencies for farming or defence while penalising steel towns by refusing to help them. The House should reject the charges which are made for political purposes by the hon. Member for Hackney, South and Shoreditch.

4.8 pm

When bringing the matter to your notice, Mr. Speaker, I was concerned solely with the issue of principle and not of personality. The question for the House is—were threats made against hon. Members to do other than what their conscience or judgment dictates? The House must decide whether the threats were made publicly.

I sent you, Mr. Speaker, copies of the popular press which contained statements showing exactly what occurred. It is a matter of great concern to the House.

In Britain we win political arguments by debate, not by threats. I do not believe that it is right that London Members should be told that if they do not vote in a certain way their constituents will suffer accordingly. That is the issue upon which the House must vote.

4.9 pm

The hon. Member for Bassetlaw (Mr. Ashton) was defending a breach of privilege that has not been determined. The matter should go to the Committee of Privileges, if only to clear up what appears to have been an ambiguity as to whether GLC members were saying, as they apparently now say, that if the House did not supply money that money would not be available for London, or whether, as the reports at the time said and which were apparently not cleared up until the press conference yesterday, there was a suggestion or threat that individual constituencies would be treated differently, and that that would be determined by how the Member of Parliament voted.

I do not believe that we should follow the line of the hon. Member for Bassetlaw and say that this is a breach of privilege that the House should pass over. We should refer the matter to the Committee of Privileges to decide.

4.10 pm

I do not want to discuss the merits or demerits of the issue. Will you, Mr. Speaker, consider the points that arose towards the end of the statement that you read? I do not have a copy, but no doubt you and the House will recall that you used words to the effect that Mr. Livingstone had said that you would not take it amiss if he informed the media.

Mr. Livingstone ought to know that he should not presume to inform the media of a matter that he knew was in the possession of the House. I am not worried about Mr. Livingstone. I am worried about the principle. This is not the first breach of privilege case. It has happened many times before, but I have never known of any person or organisation against whom complaint has been made writing to Mr. Speaker and, before Mr. Speaker receives the letter, going on the radio and television and telling Mr. Speaker that he was sure that Mr. Speaker would not take it amiss if the media were told.

We should tell everyone—whether the National Front, Mr. Livingstone, the Labour party, the Tory party or anyone else—that, if the matter is in the hands of Mr. Speaker, courtesy, custom and practice are that the will of the House should not be interfered with. Mr. Speaker is the custodian of the will of the House. Mr. Livingstone knew that the letter had been sent, and the matter should have been left there. We should have it made absolutely clear to everyone that when Mr. Speaker has been written to no one——

Who is grovelling? If the hon. Gentleman had done only half as much for the working class movement as I have, and if he knew my record, he would know that I never grovel to anyone, be it Right, Left or Centre, Chief Whip or no Chief Whip—[Interruption.] I am not grovelling to anyone. Why should I grovel to Mr. Speaker? He is not a man who would accept grovelling. Mr. Speaker has the right to protect the House. The House has the right to decide the issue.

Will you look at this matter, Mr. Speaker, so that all people—whoever they may be—can be advised that, when Mr. Speaker is writtten to, courtesy, custom and practice require that the matter be left until after the House has decided. After the matter has gone to the Committee of Privileges they can say and do as they like. It is a matter of precedence because otherwise there might be prejudice.

4.14 pm

In a succession of reports the Committee of Privileges has pointed out that the House should not take itself too seriously. When there appears prima facie to be a breach of privilege it ought not to be taken seriously by the House so that the members of the Committee of Privileges, having had to decide that a breach of privilege took place, should then have to recommend that the House should take no action.

This is a classic such case. No one has been seriously impugned. The freedom of individual Members to vote as they wish has no more been threatened than in any other kind of polemical interchange that takes place between parties throughout the country. On that basis at least, we should not refer this matter to the Committee of Privileges.

4.15 pm

The Lord President of the Council and Leader of the House of Commons
(Mr. John Biffen)

The motion in the name of the hon. Member for Hackney, South and Shoreditch (Mr. Brown) is of course debatable. This afternoon the House has taken advantage of that to express a number of views. The debate has been enriched by being wide-ranging. It is my job to recall the House to the narrower consideration of whether this matter should be referred to the Committee of Privileges.

As my hon. Friend the Member for Ealing, North (Mr. Greenway) has reminded us, the matter of privilege has been treated traditionally as one of the utmost gravity. The House will also be anxious to place in the balance a sense of realism and proportion in all these affairs. The choice of where that balance lies is one that requires the collective wisdom of the House. It is my task to say that I believe sufficient opinions have already been expressed to enable the House to proceed to that function.

Question put:

The House divided:— Ayes 203, Noes 162.

Division No. 45]

[4.15 pm

AYES

Adley, RobertGorst, John
Alexander, RichardGow, Ian
Alison, Rt Hon MichaelGower, Sir Raymond
Alton, DavidGrant, John (Islington C)
Atkins, Robert(Preston N)Greenway, Harry
Banks, RobertGrieve, Percy
Bennett, Sir Frederic (T'bay)Grimond, Rt Hon J.
Benyon, W. (Buckingham)Grist, Ian
Berry, Hon AnthonyHamilton, Hon A.
Best, KeithHamilton, Michael (Salisbury)
Bevan, David GilroyHampson, Dr Keith
Biggs-Davison, Sir JohnHannam, John
Blackburn, JohnHaselhurst, Alan
Boscawen, Hon RobertHawkins, Sir Paul
Bottomley, Peter (W'wich W)Hayhoe, Barney
Bowden, AndrewHeath, Rt Hon Edward
Braine, Sir BernardHeddle, John
Bright, GrahamHenderson, Barry
Brinton, TimHiggins, Rt Hon Terence L.
Brittan, Rt. Hon. LeonHill, James
Brooke, Hon PeterHogg, Hon Douglas (Gr'th'm)
Brotherton, MichaelHolland, Philip (Carlton)
Brown, Michael(Brigg & Sc'n)Hordern, Peter
Brown, Ronald W. (H'ckn'y S)Howe, Rt Hon Sir Geoffrey
Buchanan-Smith, Rt. Hon. A.Howells, Geraint
Budgen, NickHunt, David (Wirral)
Cartwright, JohnHunt, John (Ravensbourne)
Channon, Rt. Hon. PaulIrvine, RtHon Bryant Godman
Chapman, SydneyJenkins, Rt Hon Roy (Hillh'd)
Churchill, W. S.Jessel, Toby
Clark, Hon A. (Plym'th, S'n)Johnson Smith, Sir Geoffrey
Clark, Sir W. (Croydon S)Johnston, Russell (Inverness)
Cockeram, EricJopling, Rt Hon Michael
Cope, JohnKaberry, Sir Donald
Corrie, JohnKellett-Bowman, Mrs Elaine
Costain, Sir AlbertKershaw, Sir Anthony
Crawshaw, RichardKimball, Sir Marcus
Crouch, DavidKing, Rt Hon Tom
Dickens, GeoffreyKnight, Mrs Jill
Dorrell, StephenKnox, David
du Cann, Rt Hon EdwardLang, Ian
Dunlop, JohnLawrence, Ivan
Dunn, Robert (Dartford)Lee, John
Eggar, TimLe Marchant, Spencer
Elliott, Sir WilliamLennox-Boyd, Hon Mark
Ellis, Tom (Wrexham)Lewis, Sir Kenneth (Rutland)
Eyre, ReginaldLloyd, Ian (Havant & W'loo)
Fairgrieve, Sir RussellLoveridge, John
Faith, Mrs SheilaLuce, Richard
Farr, JohnLyell, Nicholas
Fletcher, A. (Ed'nb'gh N)Lyons, Edward (Bradf'd W)
Fox, MarcusMabon, Rt Hon Dr J. Dickson
Fraser, Rt Hon Sir HughMcCrindle, Robert
Gardiner, George (Reigate)MacKay, John (Argyll)
Garel-Jones, TristanMaclennan, Robert
Gilmour, Rt Hon Sir IanMcNair-Wilson, P. (New F'st)
Glyn, Dr AlanMcNally, Thomas
Goodlad, AlastairMcQuarrie, Albert

Magee, BryanRost, Peter
Marten, Rt Hon NeilRumbold, Mrs A. C. R.
Mather, CarolSainsbury, Hon Timothy
Maude, Rt Hon Sir AngusShaw, Sir Michael (Scarb')
Mawby, RayShepherd, Richard
Mawhinney, Dr BrianSilvester, Fred
Maxwell-Hyslop, RobinSims, Roger
Meyer, Sir AnthonySkeet, T. H. H.
Miller, Hal (B'grove)Speed, Keith
Mills, Iain (Meriden)Speller, Tony
Mills, Sir Peter (West Devon)Spence, John
Mitchell, R. C. (Soton Itchen)Squire, Robin
Moate, RogerStanbrook, Ivor
Molyneaux, JamesSteel, Rt Hon David
Monro, Sir HectorSteen, Anthony
Montgomery, FergusStewart, A.(E Renfrewshire)
Morgan, GeraintStokes, John
Murphy, ChristopherTaylor, Teddy (S'end E)
Myles, DavidThompson, Donald
Neale, GerrardThorne, Neil (Ilford South)
Nelson, AnthonyTownend, John (Bridlington)
Neubert, MichaelTownsend, Cyril D, (B'heath)
Newton, TonyTrippier, David
Owen, Rt Hon Dr DavidViggers, Peter
Page, John (Harrow, West)Wainwright, R.(Colne V)
Page, Richard (SW Herts)Wakeham, John
Parris, MatthewWaller, Gary
Pawsey, JamesWatson, John
Pitt, William HenryWellbeloved, James
Pollock, AlexanderWells, Bowen
Porter, BarryWells, John (Maidstone)
Powell, Rt Hon J.E. (S Down)Wheeler, John
Prentice, Rt Hon RegWhitney, Raymond
Price, Sir David (Eastleigh)Wilkinson, John
Prior, Rt Hon JamesWilliams, D.(Montgomery)
Proctor, K. HarveyWilliams, Rt Hon Mrs(Crosby)
Rees-Davies, W. R.Winterton, Nicholas
Renton, TimYounger, Rt Hon George
Rhodes James, Robert
Rhys Williams, Sir BrandonTellers for the Ayes:
Ridley, Hon NicholasMr. John Roper and
Rippon, Rt Hon GeoffreyMr. A. J. Beith.
Ross, Stephen (Isle of Wight)

NOES

Allaun, FrankDouglas, Dick
Archer, Rt Hon PeterDubs, Alfred
Ashton, JoeDunwoody, Hon Mrs G.
Atkinson, N.(H'gey,)Eastham, Ken
Barnett, Guy (Greenwich)Edwards, R. (Whampt'n S E)
Beaumont-Dark, AnthonyEllis, R. (NE D'bysh're)
Benn, Rt Hon TonyEnnals, Rt Hon David
Bennett, Andrew(St'kp't N)Evans, loan (Aberdare)
Bottomley, Rt Hon A.(M'b'ro)Evans, John (Newton)
Bray, Dr JeremyFlannery, Martin
Brown, Hugh D. (Provan)Foot, Rt Hon Michael
Brown, R. C. (N'castle W)Foster, Derek
Buchan, NormanFoulkes, George
Campbell-Savours, DaleFraser, J. (Lamb'th, N'w'd)
Canavan, DennisFreeson, Rt Hon Reginald
Cant, R. B.Garrett, John (Norwich S)
Clark, Dr David (S Shields)Golding, John
Clarke, Thomas(C'b'dge, A'rie)Graham, Ted
Cocks, Rt Hon M. (B'stol S)Hamilton, James (Bothwell)
Cohan, StanleyHamilton, W. W. (C'tral Fife)
Concannon, Rt Hon J. D.Hardy, Peter
Cowans, HarryHarrison, Rt Hon Walter
Cox, T. (W'dsw'th, Toof'g)Hattersley, Rt Hon Roy
Crowther, StanHaynes, Frank
Cryer, BobHealey, Rt Hon Denis
Cunliffe, LawrenceHeffer, Eric S.
Cunningham, Dr J. (W'h'n)Hogg, N. (E Dunb't'nshire)
Dalyell, TamHolland, S. (L'b'th, Vauxh'll)
Davis, Clinton (Hackney C)Home Robertson, John
Deakins, EricHomewood, William
Dean, Joseph (Leeds West)Hooley, Frank
Dewar, DonaldHoyle, Douglas
Dixon, DonaldHughes, Mark (Durham)
Dobson, FrankHughes, Robert (Aberdeen N)
Dormand, JackHughes, Roy (Newport)

Jay, Rt Hon DouglasRichardson, Jo
John, BrynmorRoberts, Albert (Normanton)
Johnson, James (Hull West)Roberts, Allan (Bootle)
Jones, Rt Hon Alec (Rh'dda)Roberts, Gwilym (Cannock)
Kaufman, Rt Hon GeraldRobertson, George
Kerr, RussellRobinson, G. (Coventry NW)
Kinnock, NeilRoss, Ernest (Dundee West)
Lambie, DavidSheerman, Barry
Leighton, RonaldSheldon, Rt Hon R.
Lestor, Miss JoanShore, Rt Hon Peter
Litherland, RobertSilkin, Rt Hon J. (Deptford)
Lofthouse, GeoffreySilverman, Julius
Lyon, Alexander (York)Skinner, Dennis
McCartney, HughSmith, Rt Hon J. (N Lanark)
McDonald, Dr OonaghSnape, Peter
McElhone, Mrs HelenSoley, Clive
McGuire, Michael (Ince)Spellar, John Francis (B'ham)
McKay, Allen (Penistone)Spriggs, Leslie
McKelvey, WilliamStallard, A. W.
MacKenzie, Rt Hon GregorStoddart, David
McNamara, KevinStott, Roger
Marshall, D(G'gow S'ton)Strang, Gavin
Marshall, Dr Edmund (Goole)Straw, Jack
Marshall, Jim (Leicester S)Summerskill, Hon Dr Shirley
Martin, M(G'gow S'burn)Taylor, Mrs Ann (Bolton W)
Mason, Rt Hon RoyThorne, Stan (Preston South)
Maxton, JohnTorney, Tom
Maynard, Miss JoanVarley, Rt Hon Eric G.
Meacher, MichaelWainwright, E.(Dearne V)
Mikardo, IanWalker, Rt Hon H.(D'caster)
Millan, Rt Hon BruceWardell, Gareth
Miller, Dr M. S. (E Kilbride)Watkins, David
Mitchell, Austin (Grimsby)Weetch, Ken
Morton, GeorgeWelsh, Michael
Moyle, Rt Hon RolandWhite, Frank R.
Newens, StanleyWhitehead, Phillip
O'Neill, MartinWhitlock, William
Orme, Rt Hon StanleyWigley, Dafydd
Palmer, ArthurWilley, Rt Hon Frederick
Park, GeorgeWilliams, Rt Hon A.(S'sea W)
Parker, JohnWilson, William (C'try SE)
Parry, RobertWinnick, David
Pavitt, LaurieWoodall, Alec
Pendry, TomWoolmer, Kenneth
Powell, Raymond (Ogmore)
Prescott, JohnTellers for the Noes:
Race, RegMr. John Tilley and
Rees, Rt Hon M (Leeds S)Mr. Nigel Spearing

Question accordingly agreed to.

Resolved,

That the matter of the complaint be referred to the Committee of Privileges.

On a point of order, Mr. Speaker. You will recollect that when I made my remarks a few moments ago on a matter that has now been disposed of I raised a point that I think has substance. I regret and apologise for the fact that I have not given you notice, but I had no intention of raising the matter at that moment. Therefore, Mr. Speaker, I know that you will not have had time to consider it. However, several hon. Members have come to me since to say that they think that we should ask Mr. Speaker whether at his leisure, when he has had an opportunity to look at what I said in Hansard, he will go into the matter to see whether my point was valid and what action should be taken on the general principle for the future. May I ask you to deal with this matter in whatever way you think best, either as a reply to a point of order or perhaps in a statement if you think that the matter is worthy of that at some future date?

Further to that point of order, Mr. Speaker. When you consider the matter, will you take account of the fact that there are hon. Members who have quite a different view and who believe that in that respect certainly the House would be taking itself much too seriously if it went up that path?

I am much obliged to the hon. Member for Newham, North-West (Mr. Lewis), who raised the point of order. Not for the first time he has shown a concern about the rights and dignities of the House. I will of course look into the matters that he has raised and will write to him or make a statement in the House.

Opposition Day

[4th Allotted Day]

The Economy

4.28 pm

I beg to move,

That this House, recognising that a competitive exchange rate is essential for Britain's recovery, condemns the gross mismanagement by the Government of its economic policies, particularly its exchange rate and interest rate policies; believes that these have greatly contributed to the collapse of Britain's industry and to the massive increase in unemployment; and calls upon the Government, as part of a new strategy to get the country back to work, to reverse the recent increase in interest rates and to reduce Britain's vulnerability to speculation by the immediate reimposition of exchange controls.

After last week's events it is only natural that in addressing the House I should point my remarks more to the Prime Minister than to her Chancellor. Like all her predecessors, the right hon. Lady is First Lord of the Treasury, but few Prime Ministers have intervened more extensively or taken more direct responsibility, at least until things go wrong, than the present Prime Minister, and few Chancellors have played so subordinate a role as the present incumbent.

While fever raged in the money markets last week, the Chancellor was so invisible and so inert that many of us thought he was spending the Christmas recess in a trappist retreat. Not a word or, in the presence of my right hon. Friend the Member for Leeds, East (Mr. Healey), not a bleat, not a sign of life came from Great George Street, except a daily drip of unattributable briefing for the media. The line was, "Do not blame us, we are only the Government; blame the Opposition instead."

It was left not to the Chancellor of the Exchequer, but to the Paymaster General, who by some happy coincidence is also the chairman of the Conservative party central office—the Prime Minister's chosen man—to break the eerie ministerial silence and to put in public what he believed, had he been able to telephone the Prime Minister in the Falklands or to communicate with the trappist Chancellor of the Exchequer in London, was the Government's general line.

Then on Thursday the Prime Minister returned, and within hours the Chancellor of the Exchequer was dispatched to the microphone and he found his tongue. But it was the Prime Minister, again on Saturday and then in a long interview on "Weekend World" on Sunday morning, who shouldered the task of stating the Government's position and intent. It is on what she had to say that I wish first to focus.

Those who saw it will, I am sure, agree that it was an astonishing and revealing performance and wholly relevant to the debate. In the course of her prolonged exchanges-40 minutes of which were devoted to the economy, covering the exchange rate, interest rates, short-term and long-term economic policies and goals—the word "unemployment" left her lips just once. What did she say about it? She said:
"as far as the costs of reducing inflation further are concerned, I think provided wage increases are below the current level of inflation, you need not have more unemployment".
There we have it. In short, if living standards are not held but actually cut, unemployment need not increase. All over Britain the scourge of unemployment has returned.

Three and a half years ago we were told that Labour was not working. Today, having helped to destroy 2¾ million jobs, having reduced the work force to the levels of 1950, having one in seven of our working people on the dole, having turned much of Britain into an industrial wasteland, having blighted the hopes of the young and having brought despair to the over-fifties, the Prime Minister cannot muster one word of concern or compassion. She gives no hint of recognition of the moral and social outrage that is involved. She accepts without question that her goal is not to reduce the 3½ million unemployed now or in the years ahead. In all this the Prime Minister has revealed her own values and her basic philosophy.

Two years ago I drew attention to another equally revealing speech that she delivered in St. Lawrence Jewry in the City when she described inflation as an evil and unemployment as a problem. It is this, of course, that leads her to over-value property and under-value people.

When taxed by Mr. Walden on the issue of maintaining the jobless and providing services for them and their families, the Prime Minister gave it as her view that it was the duty of the state to provide no more than a safety net—an assertion followed by a laudatory outburst on the virtues of private charity, of the Victorian pre-welfare state, of the "benefaction feeling" of the rich, who provided voluntary schools, voluntary hospitals, town halls and, yes, even prisons.

Yes, and soup kitchens.

What a view of the past. What a view for the future and what a threat. This is the moral and intellectual soil in which the notorious Cabinet Think Tank report last September was sown, with all its proposals for reducing pensions, dismantling the National Health Service, introducing school fees and imposing the obligation to repay loans upon recipients of university and higher education.

At the heart of this debate is the economic decline of Britain over which the Government have not merely presided but have so perversely engineered. Among the instruments of deflation that the Government have employed to flatten our economy—increased taxation and cuts in public expenditure—none has had a more malign effect than the Government's interest and exchange rate policies.

I do not think that there can be much argument or dispute that, throughout the period of this Government, we have had a serious over-valuation of the pound. Between May 1979 and January-February 1981 the pound was encouraged to rise to what at the time and in retrospect can be seen as a truly astonishing level. At the peak, in early 1981, the pound had appreciated by no less than 19·3 per cent. against the basket of other currencies and by no less than 16·5 per cent. against the dollar. Did this appreciation affect the increased strength or competitiveness of the British economy? Not at all. It rose because, in the fanatical pursuit of his money supply targets, the Chancellor shoved up the interest rate to 15 to 17 per cent. for a whole year. Capital then flowed into Britain.

Was there competitiveness? The very opposite. Our competitiveness, measured by the International Monetary Fund's index of relative normalised labour costs, fell by no less than 50 per cent.—a change in magnitude and over a timescale quite without precedent in this century. We all know what happened to industry in the following year. There was a collapse, with unemployment jumping by over 1 million in 12 months.

It was these events that provoked Dr. Otto Emminger, in his evidence to the Select Committee on the Treasury and Civil Service as recently as 25 October 1982, to say:
"the pound sterling rose against a group of important currencies on a trade-weighted basis between 1978 and the first quarter of 1981 by 25 per cent. in nominal and by 37 per cent. in real terms."
He went on to remark:
"This is by far the most excessive over-valuation which any major currency has experienced in recent monetary history."
Between the peak in early 1981 and the beginning of November 1982 sterling depreciated by 10·4 per cent. against the basket of currencies and by over 30 per cent. against the dollar. Over the same period our relative normalised labour cost dipped from 56 per cent. above its earlier level to 41 per cent. It was this latter figure, this slight improvement, that the Chief Secretary and others triumphantly acclaimed as evidence of greater productiv-ity, greater efficiency and success for the Government's incentive and supply side policies.

As recently as 9 December the Chief Secretary boasted in the House of an increase in competitiveness of some 20 per cent. When I said that it was due surely to the 10 per cent. depreciation of the pound, he claimed that the vast majority of the improvement had nothing to do with the exchange rate. Since then he has written to me to correct himself. In answer to a question put by my hon. Friend the Member for Blackburn (Mr. Straw), he has been forced to concede that 75 per cent. of that modest improvement was due to currency depreciation.

That brings me to the third and most recent phase of the sterling story—the phase that began in early November following the publication of the Chancellor's economic forecast. That showed not only that the long heralded upturn was likely to be at best fragile, if not derisory, but, far more important, that the great benefit of North Sea oil that had provided us with such substantial trade surpluses in 1981 and again, although to a markedly reduced extent, in 1982 was due to vanish in the course of this year. Thus, the Government, in the middle of a most serious slump, when imports are inevitably low and in spite of the £40 billion contribution that North Sea oil has made to the British economy in the past three years, were operating the economy with such crass incompetence that we are heading for a deficit by the end of this year. On top of that, there were much publicised fears, which continue, that oil prices could well fall and are certainly unlikely to rise.

What happened then will be within the recollection of the House. The exchange rate fell. The Chancellor rushed to the House on 18 November to reassure the money markets of the world that all was well and that the Government would maintain, as he put it, firm monetary conditions, and that his policy of allowing the exchange rate to reflect market forces was unchanged. Asked by myself and by my right hon. Friend the Member for Heywood and Royton (Mr. Barnett) for an assurance that this really was his policy and that he would not seek to reverse the market trend by raising interest rates or by seeking to prop up the rate through other means, he replied categorically:
"I shall not depart from my policy on the exchange rate … I shall allow it to be regulated by market forces."—[Official Report, 18 Novembr 1982; Vol. 32, c. 418.]
Of course, he did not so allow it. He did just the opposite. Ten days later, the commercial banks were permitted to raise their interest rates by a full 1 per cent. Then, throughout December, as we learnt when the gold and dollar reserves were published on 5 January, no less than £500 million was drawn from the reserves by the Bank of England to prop up the rate. It was then, of course, that the markets began to panic. The Chancellor was nowhere to be seen. On 10 January the second folly was committed when the Bank of England failed to prevent the commercial banks putting up their interest rates yet again by a full 1 per cent.

In eight weeks, there has been a two per cent. increase in bank rates, a depreciation of sterling by 12 per cent. and a loss to the reserves, taking November and December together, of $1 billion. Of course, the Chancellor would like to find some excuse. After all, that has been the Government's style since they came to office. In 1979ߝ80, the shooting up of inflation to 22 per cent. at an annual rate was due not to his doubling of VAT or to his other price increase measures, but to inherited pay settlements. The collapse of competitiveness was due not to his interest rate and money supply policies—17 per cent. at the peak—but to irresponsible pay claims. The appalling rise in unemployment was due not to the lethal combination of his massive increase in the tax burden, his cuts in public expenditure and his high exchange rate, but to the international recession.

So it goes on. The Chancellor has refused to acknowledge, let alone face, the disasters that his policies have inflicted on the British economy and people. He has been stripped by events of all credibility on the crucial matter of the much vaunted and long heralded upturn in the British economy. Only last May, the Chief Secretary to the Treasury was seeing signs of recovery all around him. Driven to accept that the one tiny "success"—I use inverted commas—that he might still be able to claim is a reduction in the rate of inflation, the Chancellor and the Prime Minister have doggedly resisted any change in the exchange rate, however necessary they have known it to be.

If change has come, it is in the judgment of domestic and international opinion and markets. If the judgment is that the Chancellor has failed and the absurdities of his monetarism have been rumbled, it must be the Opposition, with all their vast command over events, who are to blame. It is pathetic. I do not usually quote journals. I should like, however, to invite the Chancellor to read the current issue of The Economist with its direct and truthful statement that
"the principal reason for sterling's fall this week was simply that it was over-valued."
If the Chancellor wishes to know the view abroad, he should read the January bulletin of the Morgan Guarantee Trust Company of New York which states that
"over the first three quarters of 1982, there was no further recovery in competitiveness"—
referring to the United Kingdom—
"thus the real exchange rate remained crippling for many British firms."
Even the Chancellor must surely have read the successive pleas of the CBI in pre-Budget submissions. In February 1981 the CBI stated—its words were prophetic—that
"unless the exchange rate comes down there is a danger that companies will be forced to withdraw from markets on a large scale and to dispose of plant and equipment, management, skilled labour and sales organisations. Equally important, they will not be able to invest in the up-to-date capacity, research and development needed to meet intensified competition a few years hence. The CBI therefore calls for a declaration that the Government understands the need for a lower exchange rate and will seek to achieve it"
A year later, in February 1982, the CBI was saying that
"with present exchange rates, even with no rise in United Kingdom unit labour costs, it would take five years to bring labour cost competitiveness back to the 1975 level. To improve competitiveness, the success of businesses in controlling their labour costs ought to be backed up by further falls in sterling, particularly against European currencies."
As recently as 16 December the CBI published its preliminary survey of the industrial opinion of its members under the heading:
"Fall in pound will benefit output and profits."
The survey stated:
"Industry's output is likely to benefit significantly from the depreciation of sterling through higher exports and some improvement in domestic sales as firms are able to compete more successfully against imports."
I do not apologise for concentrating on the exchange rate. A realistic exchange rate is not a sovereign cure for all our ills, but it is a pre-condition for recovery. Everyone knows why. An over-valued exchange rate is simply a tax on Britain's exports and, at the same time, a subsidy to foreign importers. It is a self-inflicted wound—one that we are no longer strong enough to bear. There has been only one other period this century when we have punished ourselves with a similar folly. That was in 1925 when we fixed sterling against gold at its 1914 parity. A year later, we had a general strike and a major recession.

What does the right hon. Gentleman think would be an appropriate exchange rate today for the pound against the dollar? Is he still asking for a 30 per cent. devaluation, or is it only 15 per cent. now?

I shall come precisely to these exchange rate questions including the detailed ones. I shall put them and make my point within the framework of asking questions myself, because both the Chancellor and I, in a sense, have to deal with them. These will include some of the questions I mentioned in a speech at the weekend intended for the Prime Minister, together with some additional ones. I hope that the Chancellor will answer them during his speech. Is he aware that the pound, after he had pushed it up by 19 per cent. in his first period of office, has depreciated, in the two years since January 1981, by just on 22 per cent.? Has the right hon. and learned Gentleman, in the Prime Minister's words last Sunday, been totally irresponsible—or simply income-petent? Has he noticed that the rate of inflation has not increased but has fallen during this period? Does he believe that the most recent fall in the exchange rate—the 12 to 13 per cent. that has occurred in the past two months—is beneficial or harmful to Britain?

Before he answers that question, the Chancellor should remember what was said when Mr. Brian Walden asked the Prime Minister whether she regarded the recent fall in the value of the pound as having been a bad thing. What did the Prime Minister say? She said:
"you cannot hold what is a fundamentally wrong value of your currency in relation to someone else's performance … so I am not surprised at that change because it goes to the fundamental thing, the underlying industrial performance."
Did the Chancellor note the reply that was given during Question Time on Monday by his hon. Friend the Minister for Industry and Information Technology:
"The recent sharp drop in the value of sterling—it has dropped against the deutschmark and the French franc by about 12 per cent. in 10 weeks and by about 19 per cent. against the yen—will improve the competitive position of many British manufacturing firms that export."—[Official Report, 17 January 1983; Vol. 35, c. 10.]
If the Chancellor still thinks that a 12 to 13 per cent. depreciation is harmful, is it his purpose to regain the 13 per cent.? If so, how does he intend to do it?

If the Chancellor believes that the exchange rate movement is beneficial, does he consider that the attacks that the Prime Minister, his colleagues and he have launched on the City and on the Labour party recently are just so much electoral humbug? Does he intend to maintain his publicly stated stance of leaving the exchange rate to be determined by the market, or does he intend to respond to the next flurry by pushing up interest rates yet again?

As there is no reason to believe that Britain's productivity is rising or will rise faster than that of its competitors, what is the right hon. and learned Gentleman's policy for restoring the still substantial loss in our international competitiveness? Is not that policy the barren, cruel and strife-ridden course of attempting to enforce not pay moderation but continuing real cuts in the wages, salaries and standards of living of our fellow countrymen?

Will the right hon. Gentleman clear up one point? He referred to the disastrous decision in 1925. It is certainly seen in retrospect to have been disastrous to fix the value of the pound sterling. Does he agree that those disasters would have been largely avoided if the pound sterling had fixed its value in the market instead of being permanently and deliberately kept rigid by Government?

I am certain that Britain benefited enormously in 1931 when we severed the link with gold. I would not go as far as the right hon. Gentleman in arguing that in all circumstances it is better to have a completely floating exchange rate system rather than a sound one of international guidance and regulation. That is where the right hon. Gentleman and I differ.

In the light of experience, does the Chancellor agree that it was a crass error to abolish all controls on the movement of capital and domestic savings out of Britain? Is he aware that the exodus of capital has been £10 billion a year since 1980? Is he not ashamed that the total capital investment in manufacturing industry in his own country is now far smaller than the flow of British money overseas? Does the Chancellor agree that, as we are now utterly defenceless against speculation, he has a bounden duty to restore the small but effective apparatus of control that was introduced by Neville Chamberlain in 1939 and was sustained by Sir Winston Churchill, Harold Macmillan, Sir Alec Douglas-Home and the right hon. Member for Sidcup (Mr. Heath)?

Will the right hon. Gentleman explain how exchange controls assisted the Labour Government in 1976? What did they do that the IMF did not have to do for them?

No one will claim that exchange controls are an iron-clad system. If the hon. Gentleman is serious about the matter, he should examine the net export of capital from Britain between 1974 and 1979 and during the period following the abolition of exchange controls. There is no comparison.

What has the Chancellor to say about yesterday's publication, which appears in this morning's papers, of the index of industrial production? Those figures show that in November industrial production as a whole, and manufacturing output within it, fell to its lowest level yet—manufacturing output being no less than 3 per cent. down on the miserable level of 12 months ago.

There should be no doubt where the Opposition stand. We believe that the central objective of national economic policy is to create wealth, to expand output and to reduce unemployment. We believe that those objectives can be achieved only by policies of expanding demand, achieving competitiveness and far-reaching measures at company and industry level to restore the shattered supply side of the British economy.

We believe that not only was the exchange rate adjustment inevitable, but that, if the opportunity it offers is used, it will be of great benefit to Britain. It is perverse and wrong to attempt to prop up an uncompetitive rate by raising interest rates.

We intend that interest and exchange rates should serve the interests of our industry and people and that they should not be determined by exploded theories about the paramount importance of the money supply. We shall reintroduce exchange control and see to it that the savings of the British people are used to strengthen the economy of the country to which we all belong and from the prosperity of which individual prosperity is, in the end, derived.

4.57 pm

I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:

'notes that Government spending and borrowing are firmly under control and that inflation in the United Kingdom fell more in 1982 than in any other major country; rejects the reimposition of exchange controls and welcomes Her Majesty's Government's determination to maintain policies needed to combat inflation, and hence encourage growth and employment on a secure and sustainable basis.'
The right hon. Member for Stepney and Poplar (Mr. Shore) was curiously coy about answering the question that my right hon. and learned Friend the Member for Hexham (Mr. Rippon) asked him. Throughout his speech, he showed how, ever since he published the programme for recovery of 23 November on behalf of his party, he has tried to dissociate himself from its natural implications.

The press and everyone else who studied what the right hon. Gentleman said and wrote concluded that he was then prescribing a devaluation of the pound sterling by 30 per cent. So, at the time, did the right hon. Gentleman. In an interview on radio with Sir Robin Day the right hon. Gentleman reasserted what was plain from his document—that the only realistic way for Britain to recover was to bring about a realistic exchange rate. He talked specifically about a 15 per cent. devaluation in the first year and another 15 per cent. devaluation in the following one.

That is how the right hon. Gentleman's programme was interpreted. He notably failed, when presenting a rather guarded form of his prescription today, to answer the key question that he will face if he achieves that devaluation. He had nothing to say about the relationship that he would advocate between devaluation on that scale—supposing that he could achieve it—and the movement in pay and earnings that would accompany it. We would surely be entitled to conclude that his prescription for a devaluation of 30 per cent. was likely, on his analysis, to have a significant impact on inflation. We would be entitled to ask within the question—it is important that he answers it—what prescription he would then offer in relation to pay alongside such a devaluation if he could achieve it.

Before the right hon. and learned Gentleman invites me to answer those questions, will he answer my question about what the implications would be for both prices and incomes policies of his depreciation of 12 per cent. during the past two months?

Perhaps the right hon. Member for Stepney and Poplar will allow me to get beyond the first four words of my reply before interrupting. The right hon. Gentleman delivered a positive fusillade of questions in his speech. I had hardly begun to address the House when he leapt to his feet to ask another question. I shall address myself to his questions in due course.

If the right hon. Gentleman is serious in proposing a 30 per cent. devaluation of the pound sterling, that poses the most serious accompanying question. What does he wish to happen to wages alongside that change? His speech—[HON. MEMBERS: "Answer."] I shall make my speech in my own way and answer the questions when it is appropriate to do so. The curious thing about the presentation of the right hon. Gentleman's case—not only this afternoon but throughout recent months—is that he appears to be inviting the House to believe at least three contradictory propositions. He would have it believe that until November of last year the level and stability of sterling at that time was in itself bad, and that a major fall was therefore desirable. Yet he comes before the House today seeking to argue alongside that that the fall that has since taken place, although well short of his prescription, is nevertheless the signal for some economic crisis, which justifies his motion.

The right hon. Gentleman argues that the Government should have prevented the market from raising interest rates in November and again this month. There is a particular effrontery about that charge because interest rates stand 5 per cent. lower than in the autumn of 1981. They stand undoubtedly lower than they would have had the Government not pursued a consistent policy of holding down their spending and borrowing programme. They stand massively lower than they would if the right hon. Gentleman ever had the opportunity to introduce his foolish policies.

Does the right hon. and learned Gentleman agree that real interest rates in relation to inflation are higher than they were in 1981?

The right hon. Gentleman knows well that during the conditions—[HON. MEMBERS: "Answer the question."] The right hon. Gentleman has returned to an economic debate following a long absence, and must contain his impatience and refrain from uttering "Answer the question" after the first four words of my reply.

Real interest rates are high, and have been high in recent times around the world. That is because of the high uncertainty that still persists about the pace at which the world is making progress against inflation. I wish to take this opportunity to draw the attention of the House to those features that are of importance to our present economic position.

The picture painted by the right hon. Member for Stepney and Poplar was, as usual, wildly distorted and selective. Government spending and borrowing are under control and on target, and will remain so. Public expenditure plans for 1983ߝ84, published in the autumn statement, show a reduction in public spending in cost terms and as a proportion of gross domestic product compared with the plans for 1982ߝ83. Spending in the current year is likely to be below the planned figure and so, too, is borrowing. In the autumn statement we indicated that the public sector borrowing requirement this year was likely to be £0·5 billion below the Red Book estimate of £9·5 billion. Present indications are that the reduction on the Red Book estimate may be rather greater than that. The Government deficit as a percentage of GDP is, and will continue to be, one of the lowest among industrialised countries.

Monetary policy is also on course. Since February, the start of the current target period, all the main measures are within their target ranges of eight to 12 per cent. and fiscal and monetary discipline are demonstrably bringing results. During the past year inflation has been falling throughout the industrialised world but nowhere has it fallen faster than in the United Kingdom.

At the time of my Budget statement I suggested that we might hope to see inflation down to nine per cent. by the end of 1982. In my autumn statement I spoke of 6½ per cent. It is now plain that both those forecasts erred on the side of caution. I suspect that the December figure will prove to have been below six per cent., compared to 10 per cent. at the end of 1981. The November figure was already lower than for a decade, and only a quarter of the level that inflation reached when the Labour party was last in office.

Of course, sterling's recent fall will have some effect on future inflation levels, but, as I shall explain in a moment, not nearly as much as some appear to think, and much less than the Leader of the Opposition appears to hope. The Government's determination to bring down the rate of inflation is undiminished. Progress in recent months has been faster than was forecast, and may in consequence be rather slower in the months ahead, but we shall continue to experience the benefits of sound financial policies.

With falling inflation we have also seen improving efficiency and more common sense on wages and productivity. Productivity in the United Kingdom is up by 13 or 14 per cent. since the end of 1980, and is rising faster than among our partners in continental Europe.

Unit labour costs are now rising by only about 5½ per cent. a year—below the rate in most of our major competitor countries. They need to come down further, but the House should welcome the solid progrees that has been made.

Exports have held up better than many expected, and we continue to run a substantial current account surplus. That is another area where the autumn forecast is proving over-cautious. While the nation maintains a responsible approach to pay bargaining—and settlements need to come down still further—we can hope to maintain our share of a world market that should expand again in 1983, after falling in 1982.

Of course, it takes time for all the results of sound policies to come through. If there were a short-cut route, identifiable in any country, consistent with sound policies, to reduce the current tragically high unemployment figures, the Government would be the first to take it. But experience demonstrates that there is not, and it is only by pursuing sound policies that we can hope to reverse the upward trend in unemployment that has lasted for so long in this country, and which is manifest—and the House cannot escape this disagreeable fact—throughout the industrialised world.

Unemployment is more than 10 per cent. in the United States and Canada, as well as here. In Germany the figure has doubled in three years, stands at more than 2 million, and is rising faster than here. When the right hon. Gentleman pretends that the problem of unemployment is ours alone, and that an easy solution is on offer, he does the unemployed a grave disservice.

Only by continuing to deal with the deep-seated malaise in our economy, by continuing—as he would agree—to work for improved competitiveness, so that we pay our way in the world, and by continuing the battle against inflation, can we offer a sustainable prospect of higher future employment.

The November industrial production figures are disappointing, but the autumn statement foresaw a fall in the second half of 1982. The prospect for 1983 is still one of modest recovery in world trading activity, and some improvement in United Kingdom manufacturing output as a result of the improvement that we have already seen in the underlying competitive capacity of our manufacturing industry.

If we look beyond our shores, we see that in the past two years industrial production in the major OECD countries has fallen by 6 per cent. whereas in this country it has risen by 2 per cent. In the same period manufacturing production in Canada and the United States of America fell by 14 per cent. and 10 per cent., but in the United Kingdom, on a consistent basis, by only 2 per cent. Of course the fall here started earlier, but the long-standing weakness of our economy was far greater than that of any other. OECD experts now expect output in this country to grow slightly faster in 1983 than the average of the other major European economies. In condemning a rise in output of only 0·5 per cent. in the United Kingdom last year the right hon. Gentleman would do well to remember that output for the whole OECD area is estimated by the OECD to have fallen by 0·5 per cent. during that period.

The Chancellor is raping statistics with the figures that he has quoted. During the period of this Government none of the major seven Western industrialised nations has suffered a greater decline in industrial production than the United Kingdom. Between the middle of 1979 and the middle of 1982 each of our major industrial competitors showed some growth in gross domestic product. Only Britain showed an absolute slump in national wealth. Only in Britain was national wealth destroyed.

Only Britain had accumulated such problems of declining competitiveness—problems to which the Labour party was properly ready to draw attention when in office. Only in this country were two or three times as many people working in production as could have produced output on terms competitive with other countries. When this country entered the international recession its economy was suffering from more longstanding faults than that of any other country. It was bound to suffer sooner and more substantially than any other country.

It is equally true, however, that output has been falling in this way in almost every industrialised country. Our problems have an international background. That is one of the reasons why I attach so much importance to the part that I shall have to play in the weeks immediately ahead as chairman of the interim committee of the International Monetary Fund, and why I totally reject the suggestion in the amendment of the right hon. Member for Glasgow, Hillhead (Mr. Jenkins) that there is anything "narrowly nationalist" in the Government's approach to economic issues. The right hon. Gentleman may choose to take that view, but my election as chairman suggests that other Governments do not.