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Commons Chamber

Volume 81: debated on Monday 17 June 1985

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House Of Commons

Monday 17 June 1985

The House met at half-past Two o'clock

Prayers

[MR. SPEAKER in the Chair]

Private Business

LEICESTERSHIRE BILL [ Lords]

GREATER LONDON COUNCIL (MONEY) BILL

Considered; to be read the Third time.

Oral Answers To Questions

Wales

Housing Starts

1.

asked the Secretary of State for Wales what is the figure for housing starts in the public sector in Wales for the first quarter of 1985.

Four hundred and twenty-three public sector starts were reported for the first quarter of 1985.

Is the Minister aware that his reply will not bring much comfort or hope to the homeless and the ill-housed in Wales? Will he give figures for public sector housing starts in Brecon and Radnor? Will he also give the figures for that area and for Wales as a whole in the same quarter of 1979?

I cannot give a precise answer about Brecon and Radnor, but if the hon. Gentleman tables a question I shall try to answer it. The majority of local authorities are spending the greater part of their money on renovating houses. That is one reason why they are not spending on new building.

Is the Department encouraging authorities to make provision for the elderly and the disabled and for others with special needs?

Local authorities are concentrating on building for people in special need, but their priority at present remains the renovation of existing stock, both public and private. Under this Government about £500 million has been spent on renovation. The number of homeless has not increased as some Opposition Members seem to suggest.

When will the Minister recognise that the only steps taken by the Government in this vital matter have been negative, such as imposing VAT on home improvements and reducing the amount that local authorities may spend out of receipts from the sale of council houses? How can the Minister be a party to such decisions when housing in Wales is deteriorating so badly, as the Welsh media have vividly illustrated in recent weeks?

Although public sector starts are only 6 per cent. up on last year, I am glad to say that private sector starts are about 25 per cent. up on the same period last year. I am also glad to say that 1,631 starts were made in the relevant quarter.

Will my hon. Friend welcome the statement, quoted recently in the Western Mail by Mr. Lewis of the House-Builders Federation in Wales, drawing attention to the significant upturn in house building starts and to the fact that 3,000 extra jobs could result from it?

My hon. Friend is quite right. The private sector is taking the lead in meeting the demand for new housing, and there is considerable demand. We particularly need housing for executives if we are to attract industry to Wales, but there is also considerable activity by the housing associations, which are responsible for more than half the public sector starts to which I have referred.

The Minister, with his usual brilliance, has anticipated my question. Will he itemise the number of housing association starts? How does that figure compare with what the housing associations have told him they could do?

The total number of completions by the Housing Corporation and housing associations under this Government is about 10,000. Housing starts in the first quarter were about 200 by local authorities and 200-odd by housing associations.

Land Authority For Wales

2.

asked the Secretary of State for Wales if he will review the functions of the Land Authority for Wales.

A review of the functions of the Land Authority for Wales is scheduled to start in September 1986 as part of my Department's regular programme for the review of non-departmental public bodies.

During this review will my hon. Friend look carefully at the Land Authority's functions in relation to developments which are disputable and may be in conflict with the county structure plan? Does he accept that the real job of the Land Authority for Wales is to enable complex developments, such as urban centres in Cardiff and north Wales, to go ahead, and that it has no business helping to despoil the countryside?

The review will cover all aspects of the authority's operations, but at this stage I see no objection in principle to its involvement in green field sites.

Colliery Closures

3.

asked the Secretary of State for Wales when he last met the chairman of the National Coal Board to discuss colliery closures.

I met the chairman on 9 May and discussed a range of matters relating to the coal industry in Wales.

That answer is typical of the Secretary of State's lethargic attitude. Is he not aware that, in all probability because of such an attitude, the Labour party is forging ahead in the Brecon and Radnor by-election and that it now has an 8 per cent. lead? Is he also aware that since the Government were elected in 1979, in my constituency alone there has been the closure of the Caerau and Coegnant collieries as well as the Wyndham/Western colliery last January? The St. John's colliery in Maesteg is now threatened with closure as a result of the right hon. Gentleman's attitude and the fact that he condones the attitude of the chairman of the NCB. What is the right hon. Gentleman really doing to try to save jobs in Wales? That is what Labour Members want to know.

Before the coal strike began, which the hon. Gentleman encouraged throughout, deep mine losses in south Wales were around £95 million a year. It looks as though last year's losses have almost doubled to £160 million. Therefore, miners have thrown away the equivalent cost of the new Margam mine. It is hardly surprising that the amount of investment one that would like to see in the coal industry is less than it could be because of that strike encouraged by the hon. Gentleman.

Does my right hon. Friend agree that had Scargill's political strike not taken place, some of the Welsh collieries would not have been closed and the coal industry would have been financially better off? However, because of that 12-month political strike, some of those collieries must now close and production has been disrupted. People have been turned against people, neighbours against neighbours and families against families simply because of this political strike.

I have already pointed out that the strike added greatly to the area coal board's losses and directly resulted in a number of faces being lost, which will not be re-opened.

Did the right hon. Gentleman see the headline in The Times on Saturday stating:

"Miners face £10 million benefit loss"?
How much of that figure relates to Welsh miners, and will he discuss this matter with the NCB chairman? Is it not deplorable that there should now be an argument about whether any redundancies should be voluntary? Cannot the right hon. Gentleman do something to fulfil the pledges which he and other Ministers made during the strike?

I did not see the report to which the right hon. Gentleman referred, but I shall take a look at it now that he has drawn it to my attention. I believe that the pledges given by the coal board and the Government during the strike are being met, and I am told by the NCB chairman that he expects the greater number of job losses in south Wales to arise either through voluntary redundancies or by offering alternative employment in other pits.

Does my hon. Friend agree that it ill becomes the hon. Member for Ogmore (Mr. Powell) to talk about job losses in his constituency as a result of the strike which he supported, but which 70 per cent. of the miners in the constituency were against?

It would clearly have been much more desirable if there had been a ballot at the outset to decide whether the miners wanted to go on strike.

In answer to a question that I tabled, I was told that NCB (Enterprises) Ltd. has in prospect only 300 jobs, while over the same period 1,800 jobs are to be lost. In addition, every day and every week, hundreds of redundancies are announced in all our constituencies. How will the job gap be filled? Will the right hon. Gentleman review his efforts and those of the Welsh Development Agency and everybody else to see whether we can bridge the growing jobs gap?

It is absurd to suggest that all the job losses in the coal industry will be replaced by the jobs announced or encouraged by NCB (Enterprises) Ltd., but it is a matter for congratulation that in the short time that this organisation has existed it has been able to provide loans to create more than 300 job opportunities. That is a good start.

Is my right hon. Friend aware that the price of electricity is every bit as much a matter of concern both to individual voters in Wales and to job prospects, and that the price of electricity depends directly on coal costs?

That is true, and it is also true that the price of coal will be one of the factors that will influence the CEGB in deciding on its energy sources and all the other energy users deciding whether to use coal. The mining industry can do a good deal in deciding where it has markets and in seizing the opportunities that undoubtedly exist.

How can the Secretary of State expect the coal industry to be profitable in Wales if the Government continue to refuse to invest? The Coal Board has offered only £25 million of investment to south Wales over the next year and the NUM says that at least £300 million is needed. Secondly, when does the right hon. Gentleman intended to announce investment in the Margam project, as everybody in Wales is expecting such an announcement?

The Government have provided record sums for investment by the NCB. The hon. Lady knows that the Government do not decide on individual investments, which are a matter for the NCB. The NCB is continuing with its detailed planning for the Margam project, although it has taken no financial decisions yet.

Outside experts tell us that for every job lost in the coalfield, at least one other job will be lost outside. What is the assumption of the Welsh Office in this respect?

Undoubtedly, there is a multiplier effect on job losses, just as there is a multiplier effect when new firms come and create new employment, but I should not like to quantify that multiplier effect.

We have had evasive replies from the right hon. Gentleman. Is it not unjust that the south Wales coalfield produces 8 per cent. of coal but receives only 5 per cent. of investment and has only one high-tech coalface? Does he not understand that the south Wales coalfield needs an advocate and a protector in the Cabinet, otherwise by the 1990s there may be only 1,200 workers in the coalfield? Should not the right hon. Gentleman be that advocate? Why is he so lugubrious about coal in south Wales?

Coal closures under this Government and during my period of office have not been at the same rate as under Labour Governments, who closed pits in south Wales on a massive scale. There can be no doubt that there would be a better future and more investment for the coal industry in south Wales if it were not for the substantial losses—losses which were doubled or more because of the strike, which the hon. Gentleman encouraged.

Connah's Quay Power Station

4.

asked the Secretary of State for Wales if, when he next meets the chairman of the Central Electricity Generating Board, he will raise the future of Connah's quay power station.

The station closed last year with the loss of 400 important jobs. When wall the site be cleared, and will local labour be used in the station's demolition? Will the site be used for housing, industry, leisure or a mix of all three? Will the right hon. Gentleman ensure that the site is owned by the community at a reasonable cost? It is speculated that the new crossing of the Dee will emerge at the site of the power station. When will road building for the crossing begin?

The power station site occupies about 650 acres on the banks of the Dee. No decisions have been taken about the eventual use of all this land, although at present there is no shortage of land in the area for industrial development.

Welsh Language Education

5.

asked the Secretary of State for Wales if he is satisfied with the co-ordination of Welsh language education at nursery, primary, secondary and higher levels to ensure the best use of resources available for Welsh language education.

I have no reason to suppose that individual local education authorities, whose responsibility it is, have not made provision for Welsh language education appropriate for their areas. I have, however, received representations from various organisations and individuals on the Cymdeithas yr Iaith Gymraeg proposal for a Welsh language education development body. We are currently considering these representations, and we hope to announce our conclusions before the summer recess.

I welcome the Minister's announcement that active consideration is being given to this proposal. Does he accept that there is a wide body of support for such a proposal, which is put forward by the Welsh Language Society and runs across party lines? In looking for a new formula to get the best value for money from what is spent on the Welsh language, is it not necessary to ensure that those local authorities which do most for Welsh language education are not penalised by the rate support grant formula? Does he agree that funding through such a body could overcome the difficulty? Will he bear this actively in mind over the next few weeks?

I think the hon. Gentleman will agree that there are statutory problems. I shall not come to a firm view until I have considered all the representations put to me and all other relevant factors. I should emphasise that I have no intention of changing the present statutory framework within which local education authorities have responsibility for the provision of Welsh Language education in their areas.

I am meeting representatives of six Welsh language organisations, led by Undeb Cenedlaethol Athrawon Cymru and including representatives of Cymdeithas yr Iaith Gymraeg, shortly to hear their further views on these proposals.

Will my hon. Friend join me in congratulating the Urdd on its excellent recent eisteddfod in Cardiff? From my observation, it was a first-rate example of all that is best in our Welsh culture. It was a tribute to everyone involved, under the chairmanship of Mr. Malcom Thomas, for a great deal of excellent voluntary effort, especially by teachers.

I agree very much with my hon. Friend. I might add that the Government's support for the development of the Welsh language is not in question. We have considerably increased the resources earmarked for the Welsh language, including Welsh language education.

I agree with the Minister. The Urdd is doing magnificent work in Wales for the young people, and none of us wants to see the Welsh language withering on the vine of the 21st century. I commend to the Minister the existing consensus on the language in Wales, though there is no room for complacency. What are the prospects for the language in the heartland of Wales—in Dyfed and Gwynedd? What specific measures is he taking to enhance the language?

There is provision through special grants for the language, and we encourage it in every way through the local education authorities. I think that this is the right policy for the Government to pursue, and we have pursued it vigorously.

House Improvement Grants

6.

asked the Secretary of State for Wales how many house improvement grants were awarded in Wales (a) between February 1974 and April 1979 and (b) between May 1979 and the latest date for which figures are available.

Between January 1974 and March 1979 a total of 52,768 home renovation grants of all types were paid. Between April 1979 and March 1985 the figure was 92,726.

I thank my hon. Friend for that reply. I must confess that I am a little surprised that the figure for the earlier period was quite so high. What has been the average annual spend on housing grants under the two Administrations?

I am not surprised by my hon. Friend's surprise. Of the applications made between January 1974 and March 1979, one half were paid in 1974, which means that they were submitted and approved during our period in office. This Government have been spending about £80 million per annum on renovation grants, compared with £29 million per annum under the last Labour Government.

Have the Government postponed the idea of abolishing grants and moving towards improvement loans, or are they about to abandon them too? Before the Government consider abandoning either of those policies, will they at least meet the guarantee that they gave 50,000 Welsh home owners that they will pay the grants to which they are entitled under the existing system?

The hon. Gentleman should be aware that we have published a Green Paper and that consultations upon it will take place until 30 September. The Green Paper makes it quite clear that anybody who applied for grant during the relevant period will continue to receive it, irrespective of what happens as a result of the Green Paper.

The time taken to deal with grant applications depends entirely upon the priority given to them by local authorities. As I said earlier, local authorities are currently spending three quarters of their total housing resources upon renovation.

Does my hon. Friend agree that improvement grants have been a means of extending capital ownership and capital wealth throughout society and that in many ways they are comparable with the sale of council houses?

I agree with my hon. Friend. We have extended home ownership by the sale of council houses. I am glad to be able to tell him that 42,262 council house sales have been accomplished under this Government. We have also spent a considerable amount on the renovation of both private and public sector housing, about £275 million having been spent upon the public sector.

When will the Government recognise that in all Welsh towns there are huge waiting lists for improvement grants because so many of our people are living in substandard accomodation? The Green Paper's proposals are not the answer to the problem. Why do not the Government at last decide to engage in a major housing drive instead of persistently waffling about tax cuts, which never materialise anyway?

We are pursuing a very active housing policy and have achieved record figures of council house sales to sitting tenants. The Government are undoubtedly meeting the wishes of people in Wales by selling council houses to sitting tenants, and I am delighted that at long last the Opposition have embraced this policy. The Government are also pursuing a very active renovation policy. We have spent about £500 million on renovating the housing stock of the public and private sectors.

Primary Schools (Expenditure)

7.

asked the Secretary of State for Wales how much was spent per pupil in primary schools in Wales in the most recent year for which figures are available; and how this compares with the figure for 1978–79, at constant prices.

At 1983–84 prices, spending per primary school pupil in Wales was £655 in 1978–79 and £758 in 1983–84, an increase of 15 per cent.

Is my hon. Friend satisfied that the people of Wales are aware of the Government's excellent record in increasing the amount of money spent per pupil, in real terms, in Welsh primary schools? If not, what steps is he taking to ensure that they are made aware of it?

I have issued invitations to every local education authority in Wales to come and discuss with me, in a constructive spirit, the problems of resource management. I take every opportunity to get across the facts. There have not been any massive or savage cuts. Neither I nor the Welsh Office underestimate the problems of resource management and we accept that they must be grappled with. However, we must get away from some of the Opposition's rhetorical nonsense.

Does the Minister realise that the complacency of his answer is not justified by the evidence of what is happening in our schools? The capitation allowance given to head teachers of primary schools, particularly in the county of Powys, shows that they do not have enough money to buy the paper, crayons, materials and other equipment that are required if primary school children are to be taught properly.

The hon. and learned Gentleman obviously did not listen to my answer. I have already said that I am not complacent, but, rather, concerned about the failures of resource management. Head teachers have made precisely that point to me, but provision is made by the local education authorities and not by central Government. Consequently, to say that we do not give them enough is to fly in the face of the facts and of the figures produced by the local education authorities themselves.

How many children are being affected by the teachers' dispute? Can my hon. Friend say what the effect would be on school buildings, textbooks and education budgets if a settlement were made that was above the Government's guidelines?

I can reply to that point quite simply and succinctly. Although we have been through an era of falling school rolls, the drop in the number of teachers has been significantly less. The fall will vary in different local education authorities. However, I must put the matter bluntly, as both the House and the profession should know that one teacher's salary would buy a lot of chalk, books and other modern technological aids to education.

Is the Minister aware that the figures that he gave could be viewed in a different light if such things as school meals, the standard of school cleaning and the capitation allowances were all taken into consideration? Will he admit that the facts are quite different? The hon. Gentleman must be aware that the council in Clwyd has frozen all teaching posts and that, as a result, the September term will be a disaster for teaching? Is the Minister happy that one of the councils over which he has responsibility with regard to grant holdback—I refer to Clwyd—should have been forced to adopt such a position?

The council has been forced to do so as a result of its own policies. Contrary to what the hon. Gentleman has said, there has been a sharp rise, in constant terms, in educational expenditure in Clwyd. In view of the facts supplied by that local education authority, I must say that the hon. Gentleman's points have no validity.

Does the Minister appreciate that recent HMI reports do not bear out the optimistic picture that he is trying to portray? Will he bear in mind that conditions in the teachers' dispute are deteriorating and that morale among teachers is at an all-time low? Discipline is also crumbling in our schools. When will the Government launch an initiative to settle this very nasty dispute?

I must make it clear that I have no direct responsibility with regard to the teachers' pay dispute. However, I utterly reject any Opposition suggestion that I am complacent. I propose to meet all the local education authorities to discuss the problems against a background of facts, not rhetoric.

Courtaulds (Greenfield Plant)

9.

asked the Secretary of State for Wales if he will make a statement about Her Majesty's Government's representations to Courtaulds plc. regarding its proposal to close its plant at Greenfield.

Plant closures of this kind must be for the commercial judgment of the company, but my right hon. Friend the Prime Minister and I have urged the chairman to make all possible efforts to mitigate the consequences in the areas affected. I know that he is considering how the company can help.

Now that detailed negotiations have begun between Courtaulds and Delyn borough council, will my right hon. Friend continue to impress upon Courtaulds that it has obligations to the community that I represent and that it must—in his words—clear away debris and dereliction and assist in the task of new job creation? Should not Courtaulds also pay back the £2·8 million of public money invested in the modernisation of Greenfield between 1979 and 1981?

As my hon. Friend knows, I have made clear my views on the obligations of Courtaulds. Indeed, my hon. Friend has just referred to remarks that I made in the Welsh Grand Committee. There are established rules for the clawback of regional development grant. I expect that some of the grant may be eligible for clawback, and it is something that we are discussing with the company.

The loss of the Courtaulds jobs is a hammer blow to the north-east Wales economy. Why does the right hon. Gentleman not give a major cash boost both to the Welsh Development Agency and the Mid-Wales Development Agency rather than submit them to real-term cuts? They are underfunded and need more powers to face the problems with which they are asked to deal. May I remind the right hon. Gentleman that during the past four months Wales has lost 4,000 manufacturing jobs, and that since he took office Wales has lost 131,000 manufacturing and construction jobs? What is he doing in the Cabinet to obtain a change of policy that will give hope to the people of Wales?

It is characteristic of the hon. Gentleman that all he wishes to do is to throw money in every possible direction. On Courtaulds, we have been having detailed discussions with the local authorities, and others involved, on specific proposals for the area. I expect to make an announcement about the measures to be taken within the next two or three weeks.

Labour Statistics

10.

asked the Secretary of State for Wales what is the level of unemployment in the county of Gwent at the latest available date; and how this compares with the figure in June 1979.

On 9 May 1985 there were 28,898 unemployed claimants in Gwent. A comparable claimant-based figure for 1979 is not available. The figure for registered unemployed in June 1979 was 14,065.

Do not those figures tell their own story? Have we not recently witnessed the ineptitude of the Secretary of State on LSI Logic, which has ended up in West Germany? We also note that the right hon. Gentleman has accepted a 150 per cent. increase in toll charges on the Severn bridge, together with redundancies at Girlings and Standard Telephones. That has happened following six years of catastrophe. Is it not time for the right hon. Gentleman to pack up?

Since 1983 the number of overseas projects secured by WINvest totals 29, promising more than 2,000 new jobs and also safeguarding more than 2,000. That means that more than one third of the total of overseas projects are going to Wales. They include such firms as the Parrot corporation at Cwmbran, Signalex at Newport, Celatose at Ebbw Vale, Texmo at Newbridge, Control Data at Ebbw Vale and British Alcan at Newport. The truth is that Gwent has especially benefited from a very considerable flood of new investment.

Countryside Commission

Order. Before I call the hon. Member for Meirionnydd rant Conwy (Mr. Thomas) to ask his question, I remind him that it is an open question, and I hope that he will bear in mind my ruling of 14 February last year.

11.

asked the Secretary of State for Wales when he next expects to meet the chairman of the Countryside Commission.

My right hon. Friend has no immediate plans to do so since I met the chairman of the commission Sir Derek Barber and the chairman of the Welsh Committee as recently as 11 June.

Welsh Development Agency

12.

asked the Secretary of State for Wales how much capital was made available by the Welsh Development Agency to industries between 1978 to 1980 and 1981 to 1984, respectively; and what information he has as to the number of new firms established as a result in Wales between the same dates.

In the financial years 1978–79 to 1980–81 the Welsh Development Agency undertook investments of £10 million. In the years 1981–82 to 1984–85 the figure was £24 million. These investments were made in 300 companies, but a breakdown into new and existing firms is not immediately available.

I am grateful to my right hon. Friend for such an encouraging reply. Is it not a fact that the WDA has not only done excellent work since it began but is expanding? While we must not be complacent about the expansion and about the 300 companies that have received grant to the tune of £24 million, does my right hon. Friend agree that, had it been left in the hands of the Socialists, that would never have been achieved?

I should emphasise in respect of the figures that I have given, that increasingly the WDA in its investment function is acting as a lead to the syndication of funds by venture capitalists and the financial institutions generally and, therefore, the total scale of the investment led by the WDA is much higher than the figures to which I have referred.

Owner-Occupation

13.

asked the Secretary of State for Wales how many dwellings in Wales were owner-occupied at the latest convenient date; and what were the comparable figures for 1955, 1964, and 1979, respectively.

At December 1984, 733,000 dwellings, 66 per cent. of the stock, were owner-occupied, and 630,000, or 59 per cent., in 1979. Figures are not available for 1955 and 1964, but in 1961, 48 per cent. of the stock was owner-occupied.

Does my hon. Friend agree that that is a remarkable increase and demonstrates the success of the Government's policy to spread owner-occupation and ownership of property not only in Wales but in the whole of the United Kingdom?

My hon. Friend is absolutely right, and I am delighted to tell him that the Government see scope for a further increase in owner-occupation. Our low-cost housing initiatives and shared ownership schemes are designed to promote home ownership still further.

Church Commissioners

Church Of England Children's Society

15.

asked the hon. Member for Wokingham, as representing the Church Commissioners, what financial help is given to the Church of England Children's Society by the Church Commissioners; and if he will make a statement.

The Second Church Estates Commissioner, representing Church Commissioners
(Sir William van Straubenzee)

None, Sir, because it is the commissioners' duty to use their income for defined statutory purposes; namely, the pay, pensions and housing of the clergy of the Church of England.

Will my hon. Friend join me in congratulating the Church of England Children's Society on looking after more than 7,000 problem children in 1984, on helping them to be fostered and adopted, and generally on helping to improve the circumstances of all those children who have greatly suffered over the years? As the society also provides special homes for the children, will my hon. Friend reconsider his answer, because these children desperately need help?

I wish to make it absolutely clear that whether or not there is a contribution from the Church Commissioners is not in any sense a judgment. The Commissioners are bound by the law as laid down by Parliament, but of course I join my hon. Friend in acknowledging the splendid work done by this charity, and I know how closely he keeps in touch with it in Leicester and elsewhere.

Staff Hours

16.

asked the hon. Member for Wokingham, as representing the Church Commissioners, what are the normal hours of work of employees of the Church Commissioners; and if he will make a statement.

The normal working hours of the commissioners' employees are 41 per week, including lunch breaks.

While appreciating the expressed interest of the bishops and clergy of the Church of England and those who work for the Church Commissioners, in relation to the problem of unemployment, and bearing in mind the assets, amounting to £1·6 billion, of the Church Commissioners, will my hon. Friend say how many jobs have been created in those areas?

As I told my hon. Friend on 14 March, the very fact that by far the greater part of the portfolio of investments is in ordinary shares in British industry, commerce and services is itself substantial in relation to creating jobs, apart from their work in agriculture. I have also outlined—I must not detain the House on this issue—certain specific initiatives for investment in areas of very high unemployment.

Had the pay of the staff not been linked to Civil Service rates, would the commissioners have offered more or less pay in settlements in the last couple of years?

I am certain that the commissioners would have been their usual generous selves.

As one who is fond of putting questions to the representative of the Church Commissioners, may I congratulate my hon. Friend the Member for Wokingham (Sir William van Straubenzee) on the way in which he deals with points raised by hon. Members? However, can he tell me how much time is spent by the commissioners in considering the appointments of bishops, some of which have been controversial in the past?

The commissioners take no part in the appointment of bishops. One of the great joys of answering questions on behalf of the commissioners is that it provides one of the rare opportunities that we have of hearing my hon. Friend the Member for Leicester, East (Mr. Bruinvels).

Pastoral Measure 1968

17.

asked the hon. Member for Wokingham, as representing the Church Commissioners, how many new churches have been opened and how many churches have been closed for worship since the Pastoral Measure 1968 came into operation.

A total of 1,078 churches have been declared redundant, but I am glad to say that 335 churches have been opened.

Although those statistics may seem somewhat depressing on first reading, is it not a fact that the Church is responding to the shift in patterns of population and the increased mobility of its members? Is the construction of 335 churches over the past 15 years a sign of the significant and substantial contribution which the commissioners have helped to make towards the needs of the Church's members?

I am glad to bring out the point that my answer had to be limited to 1969, which was the first year in which the commissioners had statutory powers to start to deal with many churches which had been redundant for many hundreds of years because of population movements. There is a senior diocesan who has often said that, in a mixed and large diocese, he has in his long episcopate opened far more churches than he has closed.

To enable us to evaluate the many reasons for the closure of churches, would it be possible for the hon. Gentleman to arrange for the distribution of what seems to be a valuable document on the rural problems of the Church of England, which was published recently?

I do not think that my help is necessary, as it is a published document. I shall investigate whether a copy can be placed in the Library. The right hon. Gentleman, who is used to weighing evidence, will want to remember that the document is based upon an examination of one rural diocese only. There are some who question how solid the inquiry really is.

Can my hon. Friend tell me in a letter, if not now, how many of the churches to which he has referred were in rural areas as distinct from urban areas? Will he and his fellow commissioners give some little thought to the fact that to employ a priest full-time, even an elderly priest, in a rural community is often a better way of serving that community than having team ministries and closing churches?

I shall inquire whether I can properly give an answer to the first part of my hon. Friend's question. Definition may be a problem, but I shall do my best. The second part of his question raises a matter that is not directly for the commissioners. However, I know that my hon. Friend, who follows these matters closely, will have observed that the Church itself has been undertaking a close inquiry. If he has not seen the report on how the system is working, I shall happily send him a copy.

The Church moves quickly to close uneconomic churches. Why does it not put up the same resistance to closures as it did to the closure of uneconomic pits?

That is because it is not directly concerned, for obvious reasons, with the law passed by the House on the coal mining industry.

Bearing in mind that there are now 10,000 clergy compared with 20,000 100 years ago, when the population was half what it is now, is it not clear that much more vigorous recruitment is needed of high-quality clergy if rural areas are to be served as well as urban areas?

I make it clear that I am not answerable for the training of the clergy. I can only try to assist. I hope that I may make that distinction. The Church has always maintained a very high training standard and has refused to lower standards merely because it would be tempted to increase the numbers.

Order. I am not certain that I should have allowed the hon. Member for Birkenhead (Mr. Field) to ask that question. I hope that it will not be asked again.

With respect, Mr. Speaker, it was a supplementary question to which the hon. Member for Wokingham (Sir W. van Straubenzee) gave his usual evasive and platitudinous reply—

Order. To be fair, the hon. Member for Wokingham (Sir W. van Straubenzee) does not have responsibility for coal mining.

The Arts

Regional Arts Associations

18.

asked the Parliamentary Under-Secretary of State answering in respect of the Arts when the Minister for the Arts next expects to meet representatives from the regional arts association.

The Parliamentary Under-Secretary of State for the Environment
(Mr. William Waldegrave)

My noble Friend met a number of directors of regional arts associations on 7 June.

When the Minister for the Arts next meets the chairmen of the regional arts associations, will he discuss the Arts Council report of 29 May? That report clearly reveals that an extra £37 million is required from the Government to make good the loss in arts expenditure if the GLC and the metropolitan county councils are abolished. Is the Under-Secretary of State aware that the Arts Council has said that about 550 arts organisations are at risk? When the Arts Council responds, will the Government give a favourable and considered reply to this urgent case?

My noble Friend will certainly take account of these submissions in his consideration of the Arts Council's needs. We must be wary of scare stories. Last year there was a perfectly clear ploy by some of the authorities which will be abolished to increase expenditure. They tried to land the Government in some embarrassment. We have guaranteed that we shall fill the gap on the 1983–84 basis. We shall, of course, examine what else needs to be done. The boroughs in the new districts that will succeed the abolished authority areas must play their part.

When my hon. Friend the Under-Secretary of State and the Minister for the Arts next meet representatives of the regional associations, will they make it clear that many terminological inexactitudes from County Hall, such as that services in the arts will suffer when the GLC has been abolished, have been exposed for what they are—for example, the scare story by the GLC that concerts at Kenwood would cease?

A completely new organisation would be needed to counter the moving target of the stories put out by the GLC. My hon. Friend refers to one, but he could add many others to the list.

Is the hon. Gentleman aware that the Minister for the Arts made a statement that, given good will and a positive spirit, the arts will be in no danger of diminishing in London? Will the hon. Gentleman tell the House about this positive spirit in the light of the possible £21 million decrease in arts funding?

The first and most positive response was the Government's quick move at the beginning of the abolition debate to put money on the table.

A large sum—£16 million—for the arts. This was made on the basis of 1983–84 expenditure. My noble Friend has made it clear that he will consider whether additional expenditure is needed.

When my hon. Friend next meets representatives of the regional arts associations, will he note that, although funding for Lincolnshire and Humberside has risen to £618,000 this year from £523,000 last year—a welcome increase—and expenditure is 44p per head in that region compared with 24p per head in Greater London, those figures do not take adequate account of the grave problems faced in funding the arts in rural areas? It can take at least two hours to travel from north Humberside to south Lincolnshire. Some citizens of small Lincolnshire towns never see Arts Council activities. Will my hon. Friend try to continue his policy of transferring grants from the great cultural wen of London to rural areas?

I do not necessarily agree with the description of London given at the end of my hon. Friend's question. It is central to the Arts Council's strategy, which has my noble Friend's support, to give greater support to the regions and provinces.

Is the hon. Gentleman aware that this has been a quite disgraceful response? The figures have been worked out, not on the basis of extravagant local spending, as alleged by the Minister, who made certain accusations, but by the arts associations and the Arts Council. There is a shortfall not of £21 million but of £30 million, because £9 million has already had to be wiped off. The arts associations recognise that fact. That sum is equivalent to three times the amount given per year to all the regional arts associations in London. That is a horrendous figure.

Secondly, instead of attacking the local authorities, will the Minister reiterate to the House the pledge given by his noble Friend the Minister for the Arts, who will be dealing with the matter today, that there will be full replacement of the money lost? The Minister's figure of £16 million is now £30 million. That is horrendous and cannot be replaced by Paul Getty. Will the Minister now give a pledge to this House, or ensure that his noble Friend will give a pledge this afternoon when the matter is debated in the other place?

The hon. Gentleman is a little off-beam. The pledge was on the 1983–84 basis, and that has been met. My noble Friend will be considering what is needed in addition, if more is needed. I am by no means attacking local authorities. By saying that everything should be done by central Government, the hon. Gentleman is providing an excuse for those boroughs which do not want to undertake their responsibilities.

Fund Allocations

19.

asked the Parliamentary Under-Secretary of State answering in respect of the Arts what proportion of the budgets of Opera North, the English National Opera, and the Royal Opera House, Covent Garden, are to be met from centrally allocated funds in 1985–86.

The percentages are: Opera North, 56·7, English National Opera, 54·5 and Royal Opera House, 49·0.

Is the Minister aware that the figures will not be regarded as satisfactory in the north? Does he realise that he expects far too high a proportion of the funds to come from private sources in the less affluent north, with the result that people in the north will have to accept lower standards of production? Is the Minister aware that Opera North's recent performance of "The Mastersingers" received favourable comment except for the production itself, which many commentators regarded as below par? It is entirely a matter of funding and the figures are unsatisfactory.

I am sure that the hon. Gentleman will welcome the continuance of the company as a separate company. I note that the figures show that a lower proportion of funding is expected to come from private sources in the north than is the case in London. On the other hand, a very large increase—25·8 per cent., the largest of all—has been made in the funding of the Yorkshire arts in this year. That is helping many new bodies—for example, Phoenix Dance.

Is my hon. Friend aware that British opera, ballet, orchestral concerts and many other arts, have a high standard of excellence, attract huge numbers of foreign visitors to our shores, and generate employment not only in the arts but in hotels, catering and so on, out of all proportion to the funding with which they are provided? Is that sufficiently taken into account by the Government in assessing the degree of funding that would be beneficial?

My hon. Friend is right, and it is one of the considerations that my noble Friend takes into account.

Business Sponsorship

20.

asked the Parliamentary Under-Secretary of State answering in respect of the Arts if he will list the most recent examples of major business sponsors of the arts under Her Majesty's Government's pound for pound scheme; and if he will make a statement.

Under the pound for pound scheme which started on 1 April, BSIS awards of £10,000 or more have been made in response to the following major new sponsorships: £25,000 to the London City Ballet, sponsored by Neste Oy,, Finland; £25,000 to the National Association of Youth Theatres, sponsored by Anchor Foods Ltd.; £14,500 to the Arundel Festival, jointly sponsored by Harlequin Holidays, Courpark Ltd. and Blake's Hotel; and £13,000 to the Lincoln Festival, sponsored by Marconi Electronic Devices Ltd.

In the light of those contributions, and in the light also of Mr. Paul Getty junior's contribution of £50 million to the arts, will my hon. Friend confirm that the state should not be seen as the only benefactor of the arts in Britain, or seen as the benefactor of last resort?

Business sponsorship demonstrates the importance of that element in plural funding.

I know that the House will want to pay tribute to Mr. Getty—a new Maecenas come among us—for his extraordinary generous gift. It shows that there are many sources in addition to those of the state. The Getty gift was made with modesty and humour, which I think the British people like when spectacular things are done. It was also done with considerable style, and I am sure that I speak for the whole of the House in welcoming it.

With regard to the very generous gift of £50 million by Paul Getty to the National Gallery, is it now the intention of the Government to match that gift pound for pound? If that is so, where is the money to be placed?

I am afraid that Mr. Getty's gift is so great that it is not eligible under the business sponsorship incentive matching scheme.

Attenborough Report

21.

asked the Parliamentary Under-Secretary of State answering in respect of the Arts what steps the Minister for the Arts proposes taking to implement the recommendations within his responsibility of the Attenborough report on the arts and disabled people; and if he will make a statement.

The recommendations were addressed to a wide range of bodies; but my right hon. and noble Friend will be giving careful consideration to those which touch on his responsibilities.

Will the Minister pay attention to paragraph 4.17 of the report, which is one of his responsibilities, which recommends that funds should be made available so that arts venues are more accessible to disabled people? Will he consider the point made in the report that there might be an incentive scheme similar to the BSIS to make such funds available?

I shall draw the latter suggestion to my right hon. and noble Friend's attention. The previous point made by the hon. Gentleman has already been a matter for discussion with the arts funding bodies. I am aware that the hon. Gentleman has reason to be proud of the high standard of that excellent report.

On a point of order, Mr. Speaker, arising out of Question Time. There is a familiar phrase used in the House which has a bearing on what I shall ask. It relates to the organ grinder and the monkey. It is becoming extremely difficult for us, especially when figures are involved, when we receive a surrogate response. The difficulty is caused because the Minister for the Arts, not yet replaced by an American millionaire, is in another place. If, for example, the Minister for the Arts had been present in the House today he would have been forced to acknowledge his pledge of replacement for the funds and we could have questioned him on that point. Could the inconvenience that that causes on both sides of the House, and not least to Conservative Back Benchers, be made known through you, Mr. Speaker?

I have many responsibilities in this place, but the appointment of Ministers is not one of them.

British Leyland

3.31 pm

With permission, Mr. Speaker, I shall make a statement on the BL 1985 corporate plan. I am making available in the Library of the House and in the Vote Office a report by BL on its recent performance and details of the 1985 corporate plan.

The company submitted its corporate plan in December 1984, at the end of a year in which BL's recovery had been slowed by continuing over-capacity and highly competitive conditions in most of BL's markets. There has, however, been a significant improvement in performance in the first part of this year.

In March the company put to us outline proposals for further collaboration between Austin Rover and the Honda Motor Company, extending the successful collaboration on the Acclaim, Rover 200 series and the XX executive car project. The central element was a joint design and development programme on a further new car, embodying the best technology of both companies. It was also proposed that the Austin Rover group would manufacture in the United Kingdom the Honda version of the new vehicle and that Honda would manufacture in Japan for ARG. BL would also manufacture other Honda models for European sale.

Honda also said that it was considering setting up its own engine manufacturing plant in Swindon to supply engines for these Honda vehicles and the Rover 213, which currently uses an imported engine.

The Government welcomed these negotiations and have given their approval in principle to these proposals, which, now also agreed in principle between Honda and BL, provide for collaboration on the new model, the manufacture of certain other cars for Honda by BL and Honda's further consideration of the engine factory at Swindon.

The Government undertook with the company an examination of the basic corporate plan and possible variants. In the light of this the Government have given approval to the plan as amended by BL to incorporate the substance of the collaborative proposals.

As the House knows, one of the BL board's objectives is to return the business to the private sector as soon as practical. Further steps towards this objective are under consideration and I will keep the House informed of progress.

Is the Secretary of State aware that I had hoped to come to the House today to welcome with relief the Government's support for the corporate plan, including an engine development? As the statement is full of ambiguity, perhaps the Secretary of State will give us some further information in reply to questions? Is there not some deliberate fudging of some crucial issues in the statement? First, is the Austin Rover group to develop its own new British designed and manufactured engine to replace the A series engine?

Secondly, in the proposed new jointly developed car, which I understand to be a smaller version than the XX, what is meant by
"embodying the best technology of both companies."?
Is the Austin Rover group, or Honda, to supply the engine?

Thirdly, in terms of the plan and the statement, can we be assured that Britain will maintain, through the Austin Rover group, its own major British-owned engine designing and manufacturing capability?

Fourthly, in his statement the Secretary of State referred to Honda supplying engines from Swindon for "these vehicles". Does he include in that phrase the new joint car as well as the Honda vehicles to be assembled by ARG, and the Rover 213?

Fifthly, with regard to the Honda cars to be assembled at Longbridge, is this a short-term project, which represents the desirable utilisation of underused facilities, or is it a long-term project, which may mean the Austin Rover group accepting a much diminished role in terms of future car production in this country? Will the Honda cars assembled at Longbridge be counted against the Japanese voluntary import restraint, as the Secretary of State assured us is to be the case with production at Nissan?

Sixthly, if BL has to finance future development from profits, the proceeds of privatisation and borrowing, what is the amount of the guarantee of borrowings agreed by the Government with BL, and why is it not spelt out in the statement for the information of all concerned? Why is there such coyness about the money?

Seventhly, the Secretary of State said that the Government had examined variants of the corporate plan. Was one of those variants the idea emanating from the Prime Minister's own policy unit, to buy engines from Honda? Why does she have such little faith in British technology?

Eighthly, is the right hon. Gentleman aware that in its report BL states that sales of buses have been badly affected by the decline in United Kingdom bus and coach purchases? It also refers to major uncertainties. As the major factor in that decline and uncertainty is the Government's transport policies, would it not make sense to abandon them and help Leyland Vehicles as well as millions of passengers?

Ninthly, why are the Government persisting in selling off the profitable subsidiary, Unipart, the financial success of which would strengthen the group if it were retained?

Finally, can the Secretary of State tell us specifically about Honda's plans at Swindon? Are they to be confined to engine production for Honda vehicles, or is there an intention to enter upon full-scale vehicle manufacture?

In answering those precise questions, will the Secretrary of State bear in mind that the Government's good intentions will turn on his avoidance of ambivalence and ambiguity?

It is characteristic of the right hon. and learned Gentleman that on 15 May he said that if the Government

"support the corporate plan and give BL the resources that all who work there believe that it deserves and which the Opposition certainly support, I shall be the first to congratulate the Government."—[Official Report, 15 May 1985; Vol. 79, c. 332.]
I think that the right hon. and learned Gentleman may have missed the chance of congratulating the Government first. It would be typically ungenerous of him to do so.

There is no fudging of these issues. First, the right hon. and learned Gentleman asked me whether BL is to develop an engine to replace the A series—that is the K engine. The answer is yes.

My goodness, if I detailed every product that was to be produced, it would be a very long statement.

Secondly, the right hon. and learned Gentleman asked what it meant when I said that the new car would embody the best of both companies' technologies. It meant that the new car would embody the best of both companies' technologies. Surely that must be the best way to produce a successful motor car.

The engine will be supplied in accordance with the agreements that are reached, and I expect that the cars produced in Britain will have British-produced engines. The cars that are produced overseas will bave Honda-produced engines.

Fourthly—I think—the right hon. and learned Gentleman asked whether the engine plant at Swindon was projected for just the "other cars" or for the YY car as well. The answer is that the new car has not yet been defined and the engine plant at Swindon which is under consideration is to produce engines for the Honda-badged cars and the Rover 213.

Fifthly, the right hon. and learned Gentleman asked whether the Honda-badged cars produced in Britain would count against the industry-agreed informal quota of Japanese cars on the British market. The answer is no, because the aim is to achieve a level of British content that will qualify them as European cars to be sold in the European market. [Interruption.] It will be done as soon as possible.

Order. There are 10 questions to be answered, and if the Opposition Front Bench ask supplementary questions as we go along, we shall be here for a long time.

Sixthly, the right hon. and learned Gentleman asked about changes in borrowings and guarantees. There have been no changes in those matters. Seventhly, he asked about variants of the plan and referred to the influence of No. 10. The right hon. and learned Gentleman should not believe all that he reads in the papers. If he bases questions on speculative stories in the press, he must expect to be told firmly that he should do better homework and listen more carefully to the answers that he gets.

As for BL and buses, the concept of a bus manufacturing company should be that it produces buses to suit the needs of the consumer. The Transport Bill is aimed at putting consumers' needs first.

Will my right hon. Friend accept from me that the town of Swindon will be grateful for the news that, as a result of his statement, there is to be a resurgence of engineering jobs to replace those that will almost certainly be lost in another industry in the town? The statement will, therefore, be warmly welcomed. Will my right hon. Friend assure the House that he will not listen to the criticisms of the Opposition Front Bench in a way that might lead to a reduction in the number of new jobs created in Swindon?

I can undertake that I will always listen to criticisms, whether from the Opposition Front Bench or anywhere else, if they are sensible and well informed. That does not give me too much work to do when listening to the Opposition Front Bench. I share my hon. Friend's pleasure at the fact that new jobs can be expected in Swindon if the new engine factory goes ahead there, as we all hope it will.

Is the right hon. Gentleman aware that the approval of the corporate plan is very welcome and that the only hope for the future of BL as a volume producer in world markets is close collaboration with Honda? Will the right hon. Gentleman clarify one particularly ambiguous point in his statement? He said that Honda would give further consideration to the engine factory at Swindon. What does "further consideration" mean?

It means "further consideration". The company is considering the proposal to build an engine factory at Swindon. In my view, it is important to encourage the company to do that. It is difficult to see how the requisite levels of United Kingdom content could be reached in the Honda-badged motor cars if the engines were not built in the United Kingdom. It would perhaps be possible, but it would be difficult.

Is my right hon. Friend aware that, despite the carping tone of the right hon. and learned Member for Monklands, East (Mr. Smith), he is to be congratulated on his statement, which will be warmly welcomed in the west midlands and will have a beneficial effect in raising morale in that area among all those engaged in the motor industry? Can my right hon. Friend confirm that British Leyland will retain control of all aspects of its technology, which is so important to its engineering future?

I am grateful to my hon. Friend. Both Honda and BL agree that although they will be involved in collaborative ventures they will retain their identities and technologies. That is particularly important in engine technology.

Is the Secretary of State aware that as it is nearly 10 years since the Secretary of State and his colleagues voted against the public saving of the old BL, my constituents and the hundreds of thousands of other people who depend upon the motor industry would be pleased if the Government were fully committed to BL's corporate plan? If the Secretary of State has good news and has succeeded within the Government in achieving acceptance of the corporate plan as presented, why can he not say so? Perhaps I have misunderstood the ambiguities in his original statement, which were not cleared up in his answers to my right hon. and learned Friend the Member for Monklands, East (Mr. Smith). Have the Government given BL the necessary financial guarantees for which it asked—without ambiguity? An answer to that would reassure several hundred thousand people in the west midlands.

I am glad that the hon. Gentleman took our minds back over the last 10 years, because 10 years ago another mistake was made at a time of near disaster in BL's affairs. That was why I and a number of my right hon. and hon. Friends voted against the ill-conceived measure introduced by the then Government. In the last 10 years the British motor industry has also suffered from a grave increased penetration of our domestic, market by imports. Between 1974 and 1979 those imports increased by 28·4 percentage points. I am happy to say that between 1979 and 1984 the tide was stemmed and the increase was only 1·2 percentage points.

House will be aware that the Labour Government's record in this respect was disgraceful, whereas ours is a great improvement.—[Interruption.] That happens to be true, and the Opposition know it. The true stuff is the good stuff, and the good stuff is the true stuff—that is why the Opposition get it from me.

The hon. Member for Birmingham, Perry Barr(Mr. Rooker) asked about financial resources. The Government are not making financial resources available to BL. BL's requirements for capital will be satisfied from its internal generation of cash and from its borrowings. There are no changes in guarantees.

As in earlier years, there have been discussions about BL's borrowings and we reached agreement with BL on its likely future pattern. We also reached agreement on the treatment of receipts from privatisation. The Government will monitor carefully all aspects of BL's performance, including its financial performance and borrowings. If it becomes clear that BL has a need, or if it fears that it will deviate from the agreed pattern, the company will talk to the Government.

Is my right hon. Friend aware that I approve of the corporate plan, which was well worth waiting for? Will he comment on the proposals for the return to the private sector of Unipart, particularly since none are keener to see the project succeed than the people who work for that company?

Yes, Sir. The people working for Unipart are enthusiastic about a return to the private sector. I hope that that will be accomplished, market conditions permitting, during this year.

I am glad that the Government have approved the corporate plan, which will allow BL to develop the K series engine. Is the right hon. Gentleman aware that many people throughout the country have waited anxiously for this decision because their livelihoods depend upon it? As people's futures are at stake, it is too serious a matter for the right hon. Gentleman or anyone else to try to score political points. Is the right hon. Gentleman aware that there is no point in his hon. Friend the Member for Swindon (Mr. Coombs) clapping his hands at the thought of Honda bringing 500 jobs to Swindon if 500 other jobs are to be lost in the west midlands, because we shall be back to square one? Is he further aware—

Is the right hon. Gentleman further aware that the work people and management, who have made enormous efforts to bring BL to this point, would have been ill served if the Government had done anything other than they have done today?

As I understand it, the hon. Gentleman is saying that he would like to congratulate the Government, but in an entirely non-partisan way.

May I say how pleased I am to hear of my right hon. Friend's approval of the corporate plan and the way in which it identifies the determination of BL to be as competitive as the best of its competitors? Is he aware that Mr. Horrocks, chief executive of BL Cars, when asked by the Select Committee on Trade and Industry last year whether the company wanted any more money from the market or from the Government, replied that the company did not want one penny piece more? Will my right hon. Friend make it absolutely clear that the very substantial investment that will be required for the welcome improvements in the product range will be raised entirely from within the resources of BL?

I thank my hon. Friend for what he has said. As I think I explained earlier, the resources that BL will require are to be raised partly from internal generation of cash and partly from borrowings of a normal commercial nature. The Government will not be putting in any extra money by way of equity or the like.

I inadvertantly omitted to answer one of the points raised by the hon. Member for Coventry, North-East (Mr. Park) about the extra jobs that might be created in Swindon in relation to jobs that might be lost elsewhere. I emphasise that the plant which we hope will be built in Swindon will supply engines for the Honda vehicles to be made by BL and for the Rover 213, which currently uses an imported engine, so they will all be new engines and, one hopes, new jobs.

Order. No fewer than 38 right hon. and hon. Members have already applied to take part in the next debate, so I appeal for brief questions, which, I hope, will lead to brief answers.

I welcome in principle the approval of the BL corporate plan, particularly after such lengthy consideration. Will the Secretary of State estimate the effect on manpower employed by BL in general as a result of the variants in the corporate plan, especially as many of us were concerned that not every avenue had been explored previously? For instance, Charles Roe in Leeds is now back in production with sufficient orders to give continuing employment to 71 people. Secondly, to what extent will the manufacture of Honda engines in this country lead to a transfer of technology rather than merely using a British work force?

I am sorry that the hon. Gentleman cannot bring himself to welcome the statement in practice as well as in principle. If the collaboration goes ahead successfully and the objectives of the corporate plan are fully met, the prospects for jobs will be brighter than they otherwise would have been, but it is not possible to enumerate the jobs concerned. On the second point, I cannot say that I believe that there will be a great deal of transfer of technology, because it is primarily the manufacture of engines that will be undertaken.

British Leyland's accumulated losses are more than £1·6 billion, will my right hon. Friend be more specific about the borrowing requirements as a result of the corporate plan? Will he have a word with the Chancellor of the Exchequer, because if the Government stand behind any BL borrowing and give a guarantee that will not affect the PSBR, whereas if this were a nationalised industry it would affect the PSBR? Is this not an anomaly that should be eradicated?

One can never cease to marvel at the definitions of the PSBR around the edges, but what my hon. Friend says will be of great interest and a matter of discussion for many years to come. I cannot add to what I said earlier about the pattern of BL's borrowings. We have agreed with BL the pattern for its future borrowings, and the company and ourselves will keep a careful eye on them. If BL wishes to make any changes in its planning, it will come back to us.

Will the Secretary of State make it clear that the Government are committed to the development of the K series engine by Austin Rover? Will he also make it clear that before there is any privatisation of BL, many of the thousands of millions of pounds invested by the taxpayer will return to the taxpayer rather than go into private pockets?

For the second or third time, I must say that the Government are committed to the corporate plan, which is committed to the developement of the K engine. Sadly, many thousands of millions of pounds which have been invested have simply been lost due to the very unwise way in which the previous Government supported the Ryder plan, and many millions have been lost over the years because of fruitless, stupid and anarchic industrial disputes in the company.

Will my right hon. Friend accept the grateful thanks of my constituents at Longbridge for his continuing support of the BL corporate plan, which will lead to the production of additional new cars and engines at that plant? That is just as it should be in a factory which in terms of productivity is the most efficient in the world. Is this not a bad day for Opposition Members, who have decided that what concerns them most is who provides the toilet rolls?

I do not know about my hon. Friend's last point, but I am pleased that we have been able to continue our support of British Leyland, I hope that we shall be able to continue to do so in future. Productivity levels have greatly improved, but I am sorry that things were somewhat spoilt last year by some industrial disputes, and I very much hope that that will not recur this year. This is a bad day for the Opposition. They had hoped for bad news, but they have not received it.

Will not this plan primarily benefit the Japanese capitalists, and is it not further back door penetration of the British economy? Instead, should not the Government be encouraging public authorities, such as transport companies, area health authorities, British Telecom and the Post Office, to purchase BL products so that overcapacity is eliminated?

The answers to the hon. Gentleman's questions are no, no, no, and no respectively.

As the first agreement with BL had a hole in it, in that Honda could have exported to Spain whereas British Leyland's market share was the EEC, defined by individual countries, will my right hon. Friend make sure that Spain does not become a back door entry into the EEC by Honda from Japan, thereby impairing the market that is supposed to belong to British Leyland in the EEC as a whole? What are the implications of my right hon. Friend's announcement for the British components industry?

The implications for the British components industry are favourable. Indeed, there will be greater opportunities for that industry, provided, as ever, that it is competitive on quality, price and delivery.

As to my hon. Friend's first point, the situation has now radically changed, as both Spain and Protugal will join the European Community on 1 January next year.

Did the Minister make any attempt to bring the new Honda development to development areas, which has been the policy of successive Governments? Secondly, with regard to the statement about the British content of Honda motors, has the Secretary of State had any discussions with the Common Market authorities on this matter?

On the second point, no. These matters are fairly well understood, not least because of the discussions that have taken place from time to time about the Nissan cars that will be produced in Britain. On the first point, the Honda Motor Company suggested that if it built an engine plant here it would do so at Swindon. It has purchased a suitable site, which also happens to be in a convenient place for the BL works at both Cowley and Longbridge. It would have been wrong for me to try to persuade the company to do something which it did not think was calculated to make the greatest possible success of the enterprise.

Does my right hon. Friend agree that possibly the only disappointing thing today has been the rather churlish acceptance of this excellent news by the Opposition? Does he further accept that for the midlands motor industry the statement is one of genuine joy and satisfaction? As was said about the El Alamein battle in the second world war, if that was not the beginning of the end, it was the end of the beginning. This new acceptance by the Government of the BL corporate plan is the end of the beginning, and the future of the BL now lies with the management and the workers, and the people of the midlands. I have no doubt what their response will be. We shall win new markets, new cars and new jobs for the British nation. That is the important thing about today's announcement, and the midlands are grateful to my right hon. Friend.

I thank my hon. Friend for his comments. What is remarkable is not that the Government are once again approving a BL corporate plan but that the Honda Motor Company has taken the step of accepting that the quality levels of BL are now such that it feels safe and comfortable about BL producing Honda cars with a Honda badge, and for Honda to sell them. That is a great change from the unhappy situation five years ago.

Does my right hon. Friend accept that probably the only other group of people apart fom the Opposition who do not welcome the plan are some of Honda's motor manufacturing competitors? Can he reassure the House, as he did by innuendo earlier, that this in no way interrupts the Government's plans for the privatising parts of the motor industry?

I am grateful to my hon. Friend for what he has said. I would never be a man to be found guilty of innuendo, so I make it plain that the approval today will advance the cause of privatisation.

Can my right hon. Friend confirm that one of the main influences on the Government in making this forward-looking decision is the vast improvement in industrial relations and productivity at BL plants? Will he also confirm that the Government can reasonably look forward to a continuation of this process, which will lead to further security and growth in employment in the west midlands and elsewhere?

This is so, and had industrial relations and the productivity level not improved from the appalling state that we found five years ago, we could not have approved a plan of this kind. Nor would the Honda company have proposed such a collaboration in those circumstances. I agree that the future of the company is in the hands of the work force, and I wish it well.

Is not the way that the right hon. Gentleman treats these matters of employment, which are of considerable significance to many of our constituents, typical of his offensive, sick and perverted personality?

The hon. Gentleman is basing his question on an entirely false hypothesis. He should understand that he is sick and disappointed at the good news.

It is typical of the reaction of my constituents that they will be pleased with today's statement, as will many of us who wish to see the United Kingdom remain in volume car production and engine manufacturing development. My constituents' pleasure will not be qualified by the fact that they well remember what happened to the British motor cycle industry and do not want to repeat those mistakes.

I hope that we shall not repeat those mistakes, and I take great encouragement from the many improvements in BL. There is still a great deal to be done, and it is regrettable that last year there was a slipping back in industrial relations and productivity. Underlying trends are good, and I hope that the company will justify the Government's faith in it.

In view of the answers that the Secretary of State has been able to give, does he feel that the Prime Minister and her policy unit did any service to British industry and to BL in particular by putting forward the proposition that BL should capitulate to the Japanese and buy Honda engines instead of developing its own? As to import substitution and the voluntary restraint on Japanese car imports, why is the right hon. Gentleman treating Honda-badged, United Kingdom-produced cars differently from the way in which he intends to treat Nissan-produced cars? What will be the percentage of British components, excluding manpower, at the start of the production of the Honda-badged cars in the United Kingdom, and as a long-term objective? In making this calculation, will the Honda engines produced at Swindon to go into the Honda cars produced at BL Longbridge count as a British component contribution?

The treatment of Honda cars made in Britain will be exactly the same as the treatment of Nissan cars made in Britain. I hope that there will be a rapid building up to a European content of at least 80 per cent., on the same definition as that used for Nissan. As for the engines, I do not know what the right hon. Gentleman would call an engine that is manufactured in a factory in Britain by British workers, if it is not British.

I hope that the right hon. Gentleman will not take that view of British-designed products produced in overseas countries. I think that he would land us in a great deal of trouble if he did.

On the right hon. Gentleman's first point, the points from the No. 10 policy unit were, as always, helpful and probing questions and suggestions. There was never any suggestion of asking BL to capitulate. That is a figment of the right hon. Gentleman's imagination and that of the press.

Airports Policy

We now move to the important debate on airports policy. I remind the House that 38 right hon. and hon. Members have already shown their wish to take part, so I intend to apply the 10-minute limit between 7 and 9 o'clock. I shall give some priority to those hon. Members who were not called during the questions on the statement made on 5 January, as I said I would. In drawing up my list of those hon. Members who may take part today I have taken into account those who spoke on 31 January, when we last debated this matter and, incidentally, how long they spoke for. If some hon. Members who spoke for 20 minutes on that occasion can cut that time down to 10 minutes on this occasion, that will be a happiness to many who failed to be called on that occasion.

I have selected the amendment in the name of the Leader of the Opposition.

4.10 pm

I beg to move,

That this House approves the Government's White Paper on airports policy, Cmnd. 9542.
In proposing an airports policy to the House on 5 June, I had to try to reconcile two interests which conflict. The first is the need to provide the airport capacity that is likely to be needed in each region of the country. The second is the strong views of many thousands of people living near airports about whether further development should take place in their localities. These matters had to be decided. Perhaps the worst policy of all would have been to postpone decisions.

In their 1978 White Paper, the Labour Government foreswore forcing airlines and passengers to go where they did not want to go:
"The Government rejects the suggestion that the air transport industry should be subject to the damaging restrictions on its operations which could be the outcome of the forced diversion of traffic to regional airports."
I agree with that. But by virtue of our joint rejection of that course, there is no alternative to providing more capacity in south-east England.

However the Labour party may wriggle today, in a position of responsibility it would have had to accept the logic of providing capacity in the south-east for between 72 and 79 million passengers per annum by 1995, just as the inspector did. Economic growth, foreign earnings, and, most important, jobs in the aviation industry are at stake. So is the convenience of both business and holiday travellers.

On the other hand, the Government are acutely conscious of the inconvenience, noise, and development that airports bring to their neighbours. For these reasons we have not sought to provide any more capacity than is necessary, and to phase it so that it is provided only when it is necessary. I will discuss other aspects of environmental protection later in my speech.

I particularly understand and sympathise with the worries of people living near Stansted. They have fought long and hard against a busy airport there. My hon. Friend the Member for Saffron Walden (Mr. Haselhurst) and many other hon. Friends have put their case with consistent force and skill. It is in recognition of this concern that we have restricted expansion at Stansted to the minimum necessary.

We have done our best to meet the concerns of those who really speak for Stansted. The development of the airport will be phased, with the first phase restricted to 7 million to 8 million PPA, an increment of only 5 million to 6 million on Stansted's current capacity. The growth of traffic will be gradual, the new terminal will open around 1990, but it is impossible to say when it will reach capacity. Gradual growth will make it easier for local authorities to plan supporting development which may be needed, such as housing and services, road improvements, and so on. It will help to guard against the strains imposed by rapid expansion on a relatively small community. Good and sympathetic design of the new terminal and associated developments will be very important, and I am sure that the British Airports Authority and the local planning authority, which will need to approve the detailed plans, will strive for it.

Can my right hon. Friend explain exactly how planning approvals will be given, in view of his statement that the expansion will be phased? Is he aware that many of my constituents would accept a phased terminal expansion—say to 4 million to 5 million PPA at the most, which is what is needed at Stansted according to the White Paper, and not between 7 million and 8 million? Is he aware, further, that the British Airports Authority made it clear to me when I visited its headquarters on Friday that it was bent on building a 15-million-PPA terminal. How will that be handled by my right hon. Friend?

My hon. Friend seeks an assurance, which I am happy to give him. The British Airports Authority can apply for a 7 million to 8 million PPA terminal—I think that it is 50,000 sq m in area. It is again controlled by the number of air traffic movements, to which we hope the House wll agree to restrict Stansted. If the authority makes detailed application—it has only outline planning permission at present—which is outside that restriction, I would expect the local planning authority to refuse it, and there is always the appeal mechanism if it does not. I assure my hon. Friend that the planning defences are there to make sure that the Government's phasing of this development is adhered to accurately.

Our proposal to impose a limit on air transport movements at the airport commensurate with the first phase of development will, I hope, provide further reassurance to my hon. Friends and to local residents about the rate of growth of traffic. The legislation, which I intend to introduce at the earliest opportunity, will provide that the limit can be raised only with the approval of Parliament, which will have to be satisfied that this is necessary to meet the demand. This mechanism will ensure direct control by Parliament over the use of the airport. We cannot now be sure of the amount of demand at any time in the future, how much can be accommodated at Heathrow, Gatwick and Luton, and, above all, how successful the regional airports will be, with the Government's help, in attracting traffic. Parliament will be able to judge all these factors.

Aircraft noise at Stansted is being significantly reduced by bans on the noisier aircraft types, and we shall seek further to reduce the impact at Stansted by improving on the current noise abatement measures, which include restrictions on night operations. There is a review of night sleep disturbance currently under way. Quiet take-off and landing procedures and noise preferential routes will be required. They will be supplemented with new measures, including a noise insulation grants scheme for the Stansted area.

In the light of the decision on phasing the development of the airport, British Rail will be examining the case for a rail link to Stansted. The cheapest option would be a simple spur to the Liverpool Street-Cambridge line, costing perhaps £50 million. The options will be assessed on exactly the same terms as a rail link to Manchester airport. I understand that British Rail thinks that the Stansted study could be completed by the end of this year. The Manchester study could probably be completed sooner than that, I look forward to reading them both.

The Secretary of State will be aware that some people in the Greater Manchester area are worried that British Rail may be loading the question of the Manchester airport link because of its reluctance to see people changing from train to plane to travel from Manchester to London. Will he make sure that the development of a rail link to Manchester airport is looked at in terms of its international impact rather than simply in terms of its competition with British Rail on journeys from Manchester to London?

I shall seek to make sure of that. It is for British Rail to work out the figures and appraise the nature of the investment, but it is for me to approve it or otherwise. I shall make sure that this work is done properly. It will also be done in conjunction with Manchester city council and Manchester international airport so that they, too, can make sure that there is no suggestion—I am sure that the hon. Gentleman does not suspect that there is any such possibility—of the figures being wrongly put together.

I know there are many people in the Stansted area who oppose any more than a relatively small expansion. But there are also many who welcome the new jobs development will bring. Estimates of the number of jobs arising from expansion of the airport to a capacity of 15 million passengers per annum, both directly and indirectly, vary from 18,000 to 25,000. The inspector appeared to place more reliance on the lower figure; I have no better estimates as yet, but even on this basis it seems likely that development restricted initially to 7 million to 8 million passengers per annum would generate perhaps 10,000 jobs for the unemployed at Harlow, Braintree, Basildon, north-east London and even further afield—for instance, north-east Kent, which now enjoys good road access to the airport. Many people presently commuting to London from the area may obtain airport-related jobs. The more people from neighbouring areas take jobs there, the less will be the pressure for more housing to be provided.

My hon. Friends representing constituencies near Stansted are also concerned that low charges at Stansted might draw traffic away from the regions. This is also a fear shared by hon. Members from the north of England. For this to happen would be contrary to one of our main objectives, which is to encourage the growth of traffic at the regional airports. I assure the House that we will take the necessary steps to ensure that Stansted does not have an unfair advantage.

First, under the legislation I shall be introducing, the structure of the BAA, with seven separate companies under one holding company, will require separate accounts for each subsidiary and full financial transparency; this will inhibit cross-subsidisation. Secondly, the role of the Civil Aviation Authority, in regulating the general level of airport charges, will prevent any predatory price cutting at Stansted. Thirdly, if individal airport companies borrow from within the group or outside it, they will have to pay full commercial rates of interest. The expansion of Stansted will have to be a commercial investment. It follows that charges at the airport will need to rise steeply to meet the costs of expansion. The BAA board, since the decision on 5 June to approve the development of Stansted, has said that it will be consulting its airline customers on the increased charges required to meet the costs of providing the new capacity. The Government are determined to ensure that traffic is not attracted away from the regions by unfair competition.

My right hon. Friend said that the structure of the British Airports Authority and the seven subsidiary companies would inhibit subsidy. Many Conservative Members would like the word "prohibit" to be substituted for the word "inhibit", for many people are very sceptical about the good faith of the British Airports Authority.

With respect to my hon. Friend the Member for Barrow and Furness (Mr. Franks), I said that to set up seven separate companies will require separate accounts for each subsidiary and full financial transparency, but that is only part of what I said. I went on to say that we should insist—most probably through the articles of association—upon a commercial rate of interest being charged upon inter-company loans. Furthermore, the Civil Aviation Authority will supervise all charges to ensure that none of them is predatory. That is perhaps the most important measure. Any one of them, taken alone, is not adequate but, taken together, I believe that they will prove to be adequate for the purpose.

The Secretary of State is referring to the future. Is he aware that what is happening now is a scandal? Last year, Stansted lost £3·88 million, an average subsidy of £8 per passenger. Its landing charges are one quarter of the landing charges in Manchester. Is the Secretary of State unable to take some action immediately to end that scandal?

If the right hon. Gentleman will support the Bill which is to be placed before the House not only by his vote but by curtailing his speech, the sooner shall we have the power to do what he seeks, but in advance of that legislation I have no such power.

The Secretary of State has said that he does not wish Stansted to draw traffic away from the regional airports. Will he give a categorical assurance that there will be no hidden subsidies or cross-subsidisation for Stansted?

I have already said this at length twice, so the hon. Gentleman already has my assurance. Our policy is the reverse of Stansted being in a position to attract traffic away from the regions. Its purpose is to help to meet the growth of unavoidable demand in the southeast, not to divert traffic which would otherwise have used the regional airports.

Finally, on Stansted, we have made it clear that no second runway should be built there. I am requiring the British Airports Authority to sell all surplus land that would be needed for a second runway. Its external financing limit will be set on the basis of receiving the proceeds of sale of this land.

Will my right hon. Friend say how many international airports operate in the 1980s with one runway?

Without notice I am unable to give to my hon. Friend the answer that he seeks, but perhaps he would answer this question: how would our airports policy fare if I were to propose second runways at the three London airports which have only one runway at present?

(Stockport): Will my right hon. Friend confirm, first, that the intention of the British Airports Authority is that Stansted should primarily be a charter flight airport? Secondly, how does he intend that the CAA should supervise the charging policy at Stansted? Thirdly, is there anything to prevent Stansted from making losses and also is there anything to ensure that it declares dividends to the holding companies?

I do not confirm that the intention is that Stansted should be a charter airport. The White Paper has asked the CAA to consult all the airlines to establish what would be the right traffic distribution policy. I very much hope that the growth of scheduled services as well as charter flights will take place at Stansted. Secondly, with the information provided by separate company accounting, the CAA will undoubtedly have the power to supervise charges, both to prevent the exploitation of monopoly and to prevent predatory pricing. That is, there will be a limit both at the top and at the bottom. We shall ensure during the passage of the legislation that the powers to be made available are adequate. Thirdly, it is probable that Stansted will make losses in the early years as it develops. It is making losses already. Whether it is a separate company or whether it is part of the BAA, there still has to be the ability for it to make losses. Prestwick is also making losses. We cannot prevent a company from making losses, but we can roll up those losses in the balance sheet of the company so that it has to pay interest on them and finally redeem them when it enters a profitable period.

Does my right hon. Friend agree that if besides privatising it we changed the management structure of the British Airports Authority we might find that no losses would be made? Will he consider changing the management of the BAA as well as privatising it?

I have complete confidence in the management of the BAA, and it is not part of my plans to do as my hon. Friend suggests. We shall have enough on our plate with this legislation.

I shall give way to the hon. Member for Eccles (Mr. Carter-Jones), but after that I shall have to restrict interventions to those who have a constituency interest, otherwise I shall never finish my speech.

I am most grateful to the Secretary of State. I served, as did the Secretary of State, on the Standing Committee on the Civil Aviation Bill, which fell apart and disappeared. He mentioned that there is to be legislation. A White Paper has been published and eventually legislation will be introduced. Will he say in what way that legislation will differ from the Bill that we considered earlier this year?

The contents of the legislation are to be found in the last chapter of the White Paper, which I am sure the hon. Gentleman has studied. The Bill will contain the proposals that were included in the Civil Aviation Bill which the Government abandoned. It will be a wider Bill than the Civil Aviation Bill, but it will include many of the same powers.

On the subject of Heathrow, I must make it clear that we have not simply postponed or fudged the building of terminal 5. I have not ruled out the possibility for all time, but I am not convinced on present forecasts that it is necessary at all. Terminal 4, which is due to open early next year, will handle some 8 million PPA. Thereafter, the major constraint at Heathrow will be runway, not terminal capacity. When the runways reach saturation in the rush hours, growth in passenger throughput at the airport can come only from spreading the traffic to off-peak periods, which is unattractive to both airlines and passengers, or from an increase in the average number of passengers carried on each flight.

During the 1970s, particularly the first half, there were substantial increases in average passenger loads per aircraft at Heathrow, resulting from the introduction of larger aircraft. That growth has slowed down in recent years. Some have suggested that rapid growth in the average number of passengers per aircraft will be resumed, once runway capacity is reached. But many of the signs point in the opposite direction.

First, it is our policy to increase competition between airlines on domestic routes and to continue pressing for more liberalisation in European markets. Secondly, commuter routes are growing in importance, with a preference for frequent services and smaller aircraft. Thirdly, we are determined to maintain access to Heathrow for services from regional airports. Fourthly, aircraft manufacturers' order books suggest that there is now less interest in bigger "stretched" aircraft for long-haul services and, indeed, more airlines are considering operating twin-engined jets across the Atlantic.

The conclusion that I draw is that growth in passengers per flight at Heathrow is likely to be relatively slow, and that it is the runways which will be the constraint. Even if I am wrong, it will be a long time before extra capacity is needed. I ask the House to support the Government's decision to abandon the 275,000 air traffic movement limit, and to allow us to go back on our undertaking. The Government tried to implement this commitment in the Civil Aviation Bill, but the House did not entirely support us.