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Commons Chamber

Volume 81: debated on Wednesday 19 June 1985

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House Of Commons

Wednesday 19 June 1985

The House met at half-past Two o'clock


[MR. SPEAKER in the Chair]

Private Business

Berkshire Bill Lords

Order for Second Reading read.

To be read a Second time tomorrow.

Oral Answers To Questions


Paediatric Beds


asked the Secretary of State for Scotland what is the number of paediatric beds per thousand of client population which his Department uses as a yardstick in determining the adequacy of health provision.

There is no officially accepted target level of provision of designated paediatric beds, but I am satisfied that there is adequate provision of paediatric beds in Scotland as a whole. It is primarily for health boards to determine the pattern of provision in their own areas.

Is the Minister aware that, due to pressure on its forward budget, Lothian health board has now dropped the provision for a paediatric ward in the new hospital being built at Livingston? Is he further aware that one fifth of the population of Livingston are under the age of 10? Whatever the general standards employed, does the hon. Gentleman, as Minister responsible for the Health Service in Scotland, regard it as satisfactory to provide a new hospital which will not cater for such a large chunk of the local population? If not, will he give my constitutents an assurance that the new hospital will cater for their children?

Phase 1 of the West Lothian district general hospital will provide about 400 beds, including a paediatric department of 26 beds. That project is now under construction and, as I understand it, there is no intention of altering the plans for phase 1.

I accept that this is a health board responsibility, but is my hon. Friend aware that in Aberdeen there is a surplus of paediatric beds but a need for neonatal care? Does he agree that it would he possible to reallocate resources in such a way as to meet that need?

My hon. Friend is quite right. Health boards have to ensure that the facilities provided accord with current population and demand. The decrease in the child population means that there is undoubtedly an oversupply of paediatric beds in Scotland as a whole, but more beds are needed in certain sections.

Are the running costs available for the paediatric unit under construction in Livingston?

I am about to do so. The problem of the running costs of the West Lothian district general hospital is more attendant on phase 2. As I have explained, phase 1 contains the paediatric unit and I understand that the running costs are available.

Does my hon. Friend agree that the provisions made in Tayside, and particularly in Blairgowrie, where the cottage hospital has now become a community hospital, have achieved a sufficiency of paediatric beds and an increase in the number of geriatric beds?

My hon. Friend is quite right. In relation to all kinds of hospitals, health boards must consider the total needs of patients in the area. One of the principal needs to which I draw the attention of health boards is the need to provide more geriatric beds.

How can the Minister claim that there is an oversupply of beds in hospitals in Scotland when waiting lists and waiting time for admission are beginning to increase again? With regard to the paediatric department of the West Lothian district general hospital, if my hon. Friend the Member for Livingston (Mr. Cook) is correct, as I suspect he is, and the project has been dropped, although the Minister seems to think that it is going ahead, will the Minister instruct the health board to ensure that the paediatric unit is included?

I have explained that phase 1 is already under construction and a paediatric unit of 26 beds is included in it. I also explained to the hon. Member for Livingston (Mr. Cook) that phase 1 can be run without phase 2 being on stream.

Housing Benefit


asked the Secretary of State for Scotland what steps he is taking to give local authorities increased powers to deal with abuses of the housing benefit system.

The Government accept the housing benefit review team's recommendation that powers to prevent abuse of the housing benefit scheme should be strengthened. Our Green Paper proposes in particular that my right hon. Friend the Secretary of State for Social Services should have a reserve power to limit the level of rent eligible for housing benefit.

Is the Secretary of State aware that there are slum landlords in Glasgow and elsewhere who are letting out appalling properties at scandalously high rents to those on supplementary benefit? These rents are paid by district councils as agents for the Department of Health and Social Security. As the Government have abandoned their proposals to abolish the Rents Acts — their abolition would make the abuses even greater—what justification can there be for denying Scottish local authorities a power which is available to English local authorities to initiate the fair rent procedure? The implementation of that procedure in Scotland would allow authorities to get at bad landlords and would save money for the public purse. Why cannot that action be taken?

I appreciate the problem that the right hon. Gentleman has raised. He will know that local authorities are already empowered under the housing benefit regulations to reduce benefits where they judge accommodation to be unnecessarily large or the rent to be unreasonably high when compared with other accommodation that is available in the area. I am advised that the powers that are available to English local authorities are comparatively rarely used. We are keeping the matter under close review and if it is necessary to take action we shall have to consult COSLA before embarking on the introduction of legislation.

I find the Secretary of State's reply entirely unsatisfactory. When the Government are planning to cut housing benefit for the needy, how can the right hon. Gentleman permit the greedy to be able to abuse the present housing benefit system? The Opposition would assist in the passage of minor amending legislation to ensure that tenants are protected and that landlords are not allowed to abuse the system. Surely the right hon. Gentleman agrees that it is essential for local authorities in Scotland to have the right which English local authorities already have to apply for the rent officer to register a rent.

I can only assume that the hon. Gentleman did not hear my reply to the right hon. Member for Glasgow, Govan (Mr. Millan). There are two ways in which this wrong can be put right. First, a local authority can use its existing powers, as I have described, to limit the amount of benefit that is given where it considers that that is necessary. Secondly, tenants and their advisers have plenty of powers to demand the registration of a rent. They can demand the presence of the rent officer at any time that they wish to do so. They should be encouraged to use that right whenever they wish.

Rural Aid Fund


asked the Secretary of State for Scotland what consideration he is giving to the proposal submitted to him for a rural aid fund.

My hon. Friend the Minister with responsibilities for industry and education is to meet the Convention of Scottish Local Authorities to discuss a proposal submitted by Strathclyde regional council for the creation of a rural aid fund for Scotland.

May one hope that if such a meeting takes place the prospects are somewhat hopeful? Is the Secretary of State fully aware—I know that the district council within his constituency is one of the authorities which have supported the proposal—of the importance of such a fund, given that so many rural areas have suffered considerable deprivations over the past 10 or 20 years and will suffer further deprivation under the Transport Bill when it is enacted? Does the right hon. Gentleman appreciate how valuable even a modest rural aid fund would be to restore and maintain many rural communities?

I appreciate the right hon. Lady's views on this issue. I can assure her that the consultation that we shall be having with Strathclyde regional council will be genuine. I look forward to hearing from my hon. Friend the details of the ideas put forward by the council. I appreciate that there is much concern about how we can help rural areas,. There is a vast array of powers available for helping rural areas, and large sums are directed specially to rural areas in many different ways. We must consider whether a rural aid fund would add significantly to the present powers. If so, would it be worth while to introduce such a fund?

Is my right hon. Friend aware that the greatest need in a rural area is good transportation? In that context, the assistance that is to be made available as a result of the Transport Bill to encourage new developments in rural areas is much to be welcomed. Does my right hon. Friend agree that it would be helpful also to arrange for some focus on the passing of knowledge between those who carry out experiments in rural areas about new forms of transport which it may be possible to introduce following the Bill's enactment?

Yes. I agree entirely with my hon. Friend that the special arrangements that are being written into the provisions for transport in rural areas reflect clearly the high priority that the Government give to ensuring that rural areas are properly looked after. There has been a vast increase in the subsidies to the Highlands and Islands ferry service. That is only one example of many of the special aids that are given to rural areas.

Will the right hon. Gentleman accept that one of the most damaging actions to rural areas is the slashing of agricultural advisory services by 41 per cent.? If the English Minister of Agriculture, Fisheries and Food does that, does the Secretary of State for Scotland have to pursue the same line like a puppy dog?

We are still consulting all interests concerned as to how best to change those services. However, I never expected the right hon. Gentleman to complain. The integrated development programme, which is more than half funded by the Government, is pouring vast sums into his area in every way. I should have thought that the right hon. Gentleman would express some thanks for that.

Is my right hon. Friend not concerned that, following demands for urban and rural aid, the next demand will be for suburban aid? Is he not worried that, although many people now demand aid, the money has long since run out and we shall not be able to find any more resources with which to meet their demands?

My hon. Friend is perfectly correct, in that as long as funds are limited we must ensure that they are targeted towards the most important areas. This Government have added to the aid for urban areas, and that aid is used extensively. We have new schemes for the rural areas, including the programme for regional industrial development and the development of rural area workshops scheme, both of which have recently been introduced to give extra help to rural areas.

Does the Secretary of State realise that the people of Scotland would broadly welcome his launching the rural aid fund by handing back the £15 million that he has just taken out of the Estimates to cover the rise in rates relief, from 3p to 8p, which he engineered in order to call off the hounds who were chasing him?

I am not sure how the hon. Gentleman would like the money to be spent other than on helping the ratepayers. I should have thought that he would be pleased if the money helped ratepayers in Kilmarnock and Loudoun, as well as everywhere else.

As many successful rural schools are under threat because of the Government's education cuts, will the Secretary of State make a statement on the future of funding for rural, community-based primary schools?

Alas, the first part of the hon. Gentleman's question shows that he is, as usual, completely ill-informed. The amount of money allowed for education in Scotland is at its highest level per head ever. Indeed, the Government have raised it. As the hon. Gentleman knows, the closure of schools is a matter for the regional council in the light of its priorities. The hon. Gentleman asked indirectly about assistance for rural areas, but his area gets as much help as any.



asked the Secretary of State for Scotland what is his most up-to-date assessment of the numbers of (a) domestic and (b) commercial ratepayers in Scotland who will benefit from the terms of the Rating (Revaluation Rebates) (Scotland) Bill; and what is his latest estimate of the total cost, taking reductions on appeal into account.

The Convention of Scottish Local Authorities has now obtained returns from all the Scottish rating authorities which show that some 133,000 domestic and 62,000 non-domestic, including commercial, ratepayers will qualify for revaluation rate rebates at a total cost in 1985 of around £30 million. These figures are a reasonable measure of the likely demand for rebate.

Will not the final figure be known only when all the appeals have been resolved? Is it not true that all those most substantially affected, whose rateable value has risen more than three times, will be assisted by the Bill, and that the commitment is open-ended?

My hon. Friend is quite correct. The final figure will not be known until the last eligible ratepayer has been paid. [Interruption.] I agree that the scheme is most generous. I am surprised that Opposition Members should laugh at the provision of £30 million when many of them were asking for much less only four weeks ago. I find it hard to understand why they do not appreciate the scheme as much as Scottish ratepayers do.

The hon. Gentleman has just revealed what he was unable to reveal two weeks ago. Should he not now recognise that the cut-off point has been set too high and that many small businesses which still face extinction should have the benefit of a greater reduction than he has allowed for? Does the hon. Gentleman not realise that there is still very considerable discontent among small businesses in Scotland? If he thinks that the rates issue is dead in Scotland, he should bear in mind that it is not as dead as his party will be at the next election.

I am glad that the hon. Gentleman has been converted from the view—expressed only eight weeks ago in the House—that this is a warped priority, but I fear that, like all converts, his zeal has taken him further than his common sense might do. If he studies the scheme, he will discover that we set the level of a three times multiplier because we appreciated that we could not undo revaluation altogether and, as the hon. Member for Glasgow, Garscadden (Mr. Dewar) said, we had to set it at a level that would help those who were hardest hit. That is what has been achieved by the scheme, and it is much appreciated in Scotland.

The Bill is still going through Parliament and is now before the House of Lords. As about £20 million might be available for distribution, will the Minister consider amending the legislation so that all the funds that the Secretary of State has won from the Treasury can be used?

I do not know whether the hon. Gentleman was here when we debated the issue the other night, but I made it clear that the scheme was demand-led. I explained that the three times multiplier gave adequate protection without undoing the revaluation. We are distorting revaluation, but we are not claiming that those who have gained should give anything back. According to the latest figures available, that demand-led scheme will cost about £30 million.

Does my hon. Friend agree that even after the three times multiplier has been used there will be an increase of over 50 per cent. in the cash to be paid for rates in the Angus district, and only a little less in Perth and Kinross? Does my hon. Friend agree also that we must apply pressure to get rid of this iniquitous system, which has produced such a massive increase in rates in that part of the country?

I appreciate that under this scheme, even with the help provided by domestic relief, some ratepayers in Scotland are faced with high rate increases. The Government are studying the whole system of local government finance. We hope to be able to make proposals towards the turn of the year.

I welcome the Under-Secretary's admission that he knew, but would not admit in Committee, that there would be a substantial shortfall—probably of about £20 million — on the £50 million package about which the Secretary of State boasted at Perth. Can the hon. Gentleman confirm press reports that of the sum that would be available for the small business man and other non-domestic ratepayers, about £3 million is likely to go to the owners of poster sites in Scotland and not to small businesses?

Does the Minister accept that an element of flexibility must be built into the legislation and that if that £20 million is not paid out as advertised it will be seen by many who face rate increases of 50 or 60 per cent., with not a penny of aid, as the political equivalent of a serious breach of the Trade Descriptions Act?

I do not like to accuse the hon. Gentleman of deliberate political cynicism, but as £30 million has been made available by the Government to help those who are hardest hit—the phrase that he used in the House when he said that he would co-operate with the legislation—I find the last part of his question hard to understand.

The figures have become increasingly robust as the analysis of the revaluation has continued. The figures that I have given today were made available by COSLA on 12 June and were confirmed to an extent by the Minister of State in the debate in the House of Lords on Monday.

We have no central information about the poster sites. I understand that in the one area that has been considered in respect of poster and advertising sites they represent a small proportion in terms of numbers, qualifiers and cost.

Did the Secretary of State not claim that he had negotiated with the Treasury an extra £50 million to spend on domestic and non-domestic ratepayers? Does the Minister agree that if he does not change the multiplier he will gratuitously hand back to the Treasury £20 million which otherwise would be available to those badly affected by rate changes in Scotland? Does he agree that to fail to claim the money for Scotland would be iniquitous?

The hon. Gentleman is on record as saying that revaluation is good and I am sure that he will not withdraw that opinion. The agreement with the Treasury was that it would provide new money to underwrite the scheme, which is demand-led. At the time that the announcement was made in May, the best estimate of the cost of the scheme was £50 million.

Sporting Events (Safety)


asked the Secretary of State for Scotland whether he is satisfied with standards of safety and crowd control at Scottish sporting events; and if he will make a statement.

No one can ever be wholly satisfied about matters of safety and crowd control, and I have therefore arranged that the inquiry under Mr. Justice Popplewell should include Scottish sports grounds. My officials have asked Scottish fire brigades to visit sports grounds in their areas to advise managements on any necessary safety measures. With the co-operation of the police, a programme of such inspections is currently being undertaken. The governing bodies of sport have been asked to make constituent clubs aware of the free advice available, as the clubs have a responsibility to ensure the safety of the public.

Instead of imposing crippling rate burdens on Scottish football clubs in comparison with English football clubs, will the hon. Gentleman consider introducing a system of financial assistance for ground improvements? Will he support the representations that I have made to the Belgian Government to follow the example of FIFA and UEFA and draw a distinction between Scottish and English football, rather than impose a ban on Scottish as well as English football clubs? In effect, this ban is punishing Scottish clubs and their supporters for the gross and deplorable behaviour of some English fans during the Brussels tragedy a few weeks ago.

One of the results of the revaluation is that the rating burden on many Scottish football grounds has declined. I have every sympathy with the hon. Gentleman's point about European matches. I think the House will agree, however, that the Belgian Government's announcement in those tragic circumstances was understandable. We have passed on to the Foreign Office the representations that we have received.

In recent years, Scottish football club supporters have had an excellent record in away matches. I am sure the House agrees that, in the present circumstances, it was sensible for the five clubs involved in European competition to announce that they would do everything possible to dissuade their supporters from travelling to away matches next season, except in the case of cup finals on neutral ground.

Does my hon. Friend agree that, although the Government have had a significant influence by the banning of alcohol at football matches, ultimately every sporting club must bear a greater responsibility for the safety and care of those attending sporting events at their premises?

I entirely agree with my hon. Friend. She is absolutely right to point to the responsibility of clubs. There is no room for complacency about the control of hooliganism in Scotland. That is why I have arranged to meet the Scottish Football Association, the Scottish Football League, the chief constables and the British Transport Police on 1 July to review existing arrangements and to consider whether, in the interest of the huge majority of fans, further action should be taken to improve behaviour at football matches next season.

Does the hon. Gentleman agree that it is not enough simply to suggest that free advice will be available? If safety at football grounds in Scotland is to be improved, money must be forthcoming. The parlous state of the finances of most of the small Scottish clubs makes it difficult for them to find the necessary funding on their own. The Government must give greater support to help small clubs to make their grounds safe.

Substantial sums of money go into football, including £7 million a year to the Football Trust. Last year, the Football Grounds Improvement Trust distributed £3·3 million retrospectively. I am a member of the working group on financing improvements at football grounds, which is under the chairmanship of my hon. Friend the Member for Sutton and Cheam (Mr. Macfarlane). The FGIT surveyors' report will include surveys of all non-designated grounds in the Scottish first and second divisions.

Does my hon. Friend agree that one of the most important contributions to crowd control is an all-seated stadium? Does he agree that Aberdeen has been able to show an example of crowd control not only in Aberdeen but when Aberdeen clubs have travelled abroad? Aberdeen's supporters are ambassadors for the game, rather than the reverse.

Yes, Sir. I had the pleasure of attending Pittodrie at the beginning of the season to present the championship flag to Aberdeen. There is no doubt that it has an excellent stadium. The McElhone report emphasised the importance of seating.

When the Minister refers to £7 million going to the Football Grounds Improvement Trust, does he appreciate that that money comes from the pools companies for the use of the fixtures list? In terms of their take from betting, the Government take far more from football pools than the football clubs have returned to them for ground improvements. Does the hon. Gentleman appreciate that a ground at which we have trouble—not in terms of controlling crowds, but in relation to crowds entering and leaving—is Hampden Park, because the design of the reconstructed stadium had to be changed as a result of the Government cancelling the £5 million grant that was to have been made available? Will the Minister, as a contribution to solving the problem in Scotland, restore that grant and give the money to the Scottish Football Association at Queen's Park so that the reconstruction of Hampden Park can be completed?

The reconstruction of Hampden is going ahead, and I visit Hampden regularly. There are sources of Government assistance which are potentially available, for example, the leg-up and the urban programmes. The hon. Gentleman should accept that the tax on betting to which he refers is a tax on gambling, not a tax on football, and that is an important distinction.

Peripheral Housing Estates


asked the Secretary of State for Scotland what proposals he is considering in response to the report on peripheral housing estates by CES Ltd., "Framework for Action," a copy of which is being sent to him; and if he will make a statement.

The study was commissioned by four local authorities, including Glasgow district council, and it is for them to consider in the first instance how best to respond. I shall, nevertheless, study with interest the proposals of relevance for central Government. I welcome in particular the emphasis in the report on the need and scope for joint ventures between the public and private sectors to tackle the problems of peripheral estates.

In the light of that reply, will the Minister indicate, even informally, to Glasgow and Strathclyde that he would be willing to meet them to discuss in what way a new structure might be evolved — be it a town development or urban development corporation—to fit the needs of Easterhouse?

The hon. Gentleman will accept that I must, first, look at this quite complex document and evaluate it, and obviously I cannot make a commitment as to timing. I believe that the emphasis must be on co-ordinated action, which recognises the priority needs of Easterhouse within existing programmed expenditure. As he will be aware, the SDA is already involved in the new greater Easterhouse partnership and the new joint initiative for Easterhouse. The agency will, within the terms of its remit, continue to respond positively to the problems of such areas.

Does my hon. Friend agree that the hon. Member for Glasgow, Provan (Mr. Brown) has drawn attention to a constructive proposal for dealing with one of the many problems that arise from past mistakes by local authorities, often egged on by Governments of the day, in housing policy? While recognising that much has to be done to rectify these errors, does my hon. Friend accept that that should not be done at the expense of the housing needs of those local authorities which have pursued wiser policies?

I am grateful to my hon. Friend for making that point, and I am sure he realises that it is the Government's concern to promote and encourage private sector involvement in public sector estates, both to diversify tenure and to enhance the amenity. I hope that authorities will not stand in the way of these types of development for political ideological reasons.

Iron And Steel Industry


asked the Secretary of State for Scotland when he next plans to meet the Scottish representatives of the Iron and Steel Trades Confederation to discuss the current state of the iron and steel industry in Scotland and the economic implications thereof for Scotland.

A member of the Iron and Steel Trades Council was one of the STUC representatives whom I met on 7 June. Also, the ISTC was represented on the works committee at Ravenscraig, which my hon. Friend the Minister with responsibility for industry and education in Scotland met when he visited the works on 3 June.

What is the Secretary of State's response to this morning's press speculation, and reported remarks of Sir Robert Haslam, on the future of Ravenscraig? Does the right hon. Gentleman accept that the closure of Ravenscraig and, consequently, Gartcosh, would be a devastating blow to the Scottish economy? Is he prepared to give a lead to the Scottish ministerial team by saying that he is prepared to resign on this issue because he is not prepared to see Scotland becoming an industrial desert?

I appreciate the concern that the hon. Gentleman has mentioned. I, too, have seen the speculation in newspapers this morning. It is just that: it is speculation. The remarks made yesterday before the Select Committee were in that vein as well. The position, as I confirm again, is that there is no sign yet of the corporate plan being presented to the Government. When it is presented to the Government it will have to be carefully considered by Ministers before any decisions can be agreed to or otherwise. That is the position and, as I think the chairman confirmed in his evidence yesterday, that is likely to remain the position for some considerable time yet.

May I reassure my right hon. Friend that he will have the undivided support of Conservatives in any efforts that he makes to persuade the British Steel Corporation and his ministerial colleagues that Ravenscraig should not only continue but should enjoy new investment in coke ovens? May I further urge, if the newspaper reports are correct, that he and his ministerial colleagues plan and mount the type of skilful and successful campaign that they mounted in 1982, to ensure that Scotland retains its steel-making capacity?

I am grateful to my hon. Friend for the first part of his remarks. As to the second part, all of us have to wait to see what is in the corporate plan, and then we will have to formulate our responses very quickly.

The Secretary of State is very conscious of the fact that I am one of the hon. Members in whose constituencies Ravenscraig lies. As the right hon. Gentleman is aware, there is a conference at the civic centre in Motherwell on Friday at which there will be representations from the STUC, all the councils, all the Churches, the ISTC and all the other trades unions. Depending upon the decision, which I am sure will be a unanimous one to fight for Ravenscraig, will the right hon. Gentleman give us a categorical assurance that at Cabinet level he will lead the fight for the retention of Ravenscraig?

I well appreciate the importance of the meeting, and I am glad that the hon. Gentleman will be present. I am anxiously awaiting news of what will be in the corporate plan when it comes. I can give the assurance that, when it does, I shall be heavily involved in dealing with responses to it.

As the current uncertainty seems to stem largely from the advice of the European Commission that Britain should further reduce its steel-making capacity, can my right hon. Friend give us a clear assurance that the Government will not contemplate further reductions until the other member states of the Common Market have carried out their agreed obligations to reduce steel-making capacity? Is he aware that Members of Parliament who represent English constituencies are fully conscious of the superb battle that he has put up so far for Scotland's steel industry?

With regard to the European scene, as my hon. Friend knows, my right hon. Friend the Secretary of State for Trade and Industry and his colleague have, on a number of occasions in Brussels, forcefully made the very points that my hon. Friend has just made. That is a matter on which the Government have taken a very strong stand.

Many hon. Members are concerned about the adjective "anxious" which the Secretary of State used to describe his views on the forthcoming plan. Only one question remains: will he put the future of Ravenscraig before his own job?

I think that my views on this subject have been widely known for long enough. I have given the assurance—and nobody with any sense could expect me to go further at this time—that I am waiting to see what the corporate plan says. Thereafter we shall all have to work out our responses to it.

Will the Secretary of State acknowledge that the future of Ravenscraig is crucial to the future of Scottish industry, that the suggestion that it should be closed is something that should be considered as totally unacceptable within Scotland and that he should say so unequivocally? It is not just a matter of Ravenscraig and the jobs there, but of all the jobs dependent on it in British Rail, in the support industries and so forth. Will he acknowledge that without the steelworks Scotland cannot have a credible industrial base, and that he should say so and fight every inch of the way to ensure that the steelworks remains?

I appreciate the hon. Gentleman's continuing concern about the matter, but I suggest to him and to others that they should be careful not to close Ravenscraig before anyone has even proposed it.

When will the Government make the announcement about the new investment at Hunterston? Will it be made tomorrow before the meeting on Friday referred to by my hon. Friend the Member for Motherwell, North (Mr. Hamilton)?

Does my right hon. Friend agree that the Government have been saying to the workers and management in all industries that we have to increase productivity if we are to maintain our markets? Is it not true that, by that standard alone, Ravenscraig has excelled and we should not let anyone outside Scotland be misled by the fact that the European Community has certain levels of production which it says must be maintained throughout Europe? Is my right hon. Friend aware that we in Scotland and Britain have made our contributions, and that Ravenscraig has shown that it is the plant of tomorrow and not of yesterday?

I agree with my hon. Friend. My right hon. Friends and I have made it clear on numerous occasions that we consider that when capacity in Europe is being discussed it must be clearly understood that it is not expected that this country should do all the reducing of capacity, but that there should be an agreed system between the European countries.

In view of the recent damaging reports, and of early reports emanating from the BSC, why can we not have from the Secretary of State a straightforward and unequivocal commitment that Ravenscraig will not be closed?

The right hon. Gentleman has been in the higher reaches of Government and he will know that in nationalised industries the principle that is rightly followed is that the industry runs its own concerns and refers to the Government for the major decisions. It would be wrong, in whichever direction the proposal goes, to preempt the decision on any part of the plan before one sees the plan as a whole. Everybody concerned must wait for BSC to produce its corporate plan, and I assure the right hon. Gentleman that there will then be a clear reaction.

As it is no secret that BSC is deeply hostile to keeping Ravenscraig open, will the Secretary of State not delay too much his attack on this matter, because if he holds back decisions could be taken on the corporate plan by other Ministers? It is urgently necessary that he puts his full weight behind Ravenscraig, and I assure him that he will have every support from my party on this matter.

I am grateful for that support from the hon. Gentleman. The views of all of us in Scotland on this matter are well known, but it is prudent to wait to see a target before one starts firing at it.

Is the Secretary of State not being a little disingenuous in suggesting that this is all speculation? It is known that options were presented to the Government in the middle of last year, and that those options included the closure of a major steel plant. Is it not a fact that Sir Robert Haslam said to the Select Committee yesterday that discussions were under way on those options? In those circumstances, if the right hon. Gentleman has not seen those options, it must be because the Secretary of State for Trade and Industry has not shown them to him. Is it not essential that the Secretary of State for Scotland gets his oar in now and makes it clear that the future of Ravenscraig is non-negotiable and that it must continue to play a central role in the Scottish economy? Does the Secretary of State recall that the Minister of State, Department of Trade and Industry, said on 3 June after visiting Ravenscraig that he did not think there was any uncertainty about the future of the plant? Is not the only way that the Secretary of State can end the uncertainty started by yesterday's events is to make it clear that there will not be a closure of one of BSC's three major strip mills under this or any other Government?

I appreciate the hon. Gentleman's first point, but he must appreciate that what was said yesterday, which was not surprising, was that there were a number of different options, which were all being considered. That is as it should be. The hon. Gentleman will also know, as was made clear yesterday, that discussions are always going on between the sponsoring Department and the nationalised industry. Preparations for a corporate plan form part of a process that does not stop. However, it is essential that the industry should first make its proposals about what it thinks is the best plan for the industry's future. It is then for the Government to consider whether they are prepared to approve or reject the proposals. That is the Government's role.

British Leyland (Bathgate)


asked the Secretary of State for Scotland if will make a statement on his most recent discussions with British Leyland about the future of the Bathgate commercial vehicles plant.

British Leyland tells me that discussions are continuing to try to find a purchaser for the engine plant, although some earlier interest has receded. I understand that approaches have been made to British Leyland about developing the site for alternative use. The company has made it clear that if there is a purchaser for the engine plant, any alternative use for the site must ensure the continuation of the engine manufacturing facility.

May I ask the Minister a question, of which notice has been given to his office for a considered reply? Will the Scottish Office help West Lothian district council, Lothian regional council and Bathgate area support enterprises to obtain co-operation from Leyland for the conversion of the Bathgate premises to accommodate incoming manufacturing industry?

I am grateful to the hon. Gentleman for giving me notice of the question. First, I emphasise that Locate in Scotland has carried out the most comprehensive promotion ever undertaken for a single site, in addition to the Government's general role in improving the climate for industry in the area following the working party's report. The initiative for specific uses of the premises must lie with those who have proposals to put to Leyland. However, I assure the hon. Gentleman that my office stands ready to be involved in any discussions on such specific proposals.

Does my hon. Friend agree that the new range of commercial vehicles made by Leyland Vehicles has been amazingly successful, and that that is evidence of the great changes in productivity and efficiency of management and, above all, in the work force, and of the Government's commitment to British Leyland in the interests of the British public as a whole?

I entirely agree with my hon. Friend. There is no doubt that British Leyland has made substantial strides. The problem regarding Bathgate is that British Leyland has more than enough capacity at its Leyland plant to accommodate even a substantially increased demand for trucks.

Improvement Grants


asked the Secretary of State for Scotland when he intends to make a statement on improvement grants for private housing in Scotland.

A comprehensive review of private sector house improvement policy in Scotland is virtually complete, and I hope to publish proposals for consultation fairly soon.

Is the Minister aware that there are 1,000 closes, that is 6,000 to 8,000 houses in Glasgow, which are subject to a section 24 order, which require immediate and urgent repairs to be carried out? Is he further aware that Glasgow district council will require £25 million extra on its budget to ensure that those improvements are carried out? Despite the fact that he is carrying out a review, will he ensure that Glasgow district council is given the money to provide more jobs in the building industry and to give people a decent home to live in?

I have heard what the hon. Gentleman has to say, and I have heard those facts quoted before. I do not believe that that should have been the case, and I shall explain why. The capital allocation on the private sector non-HRA last year in Glasgow was £86·6 million, which was 50 per cent. of the Scottish total, or 11 per cent. of the Scottish total of private housing. Of those resources, £2 million was unspent, and the council chose to transfer that to its HRA block allocation rather than to augment this year's non-HRA allocation. This year the council has had about £8·5 million more than its forward commitment Indeed, the amount that has been made available to it is considerably more than its own estimate of expenditure on grants related to section 24 repairs and notices.

How does the Scottish Office justify a lower rate of housing improvement grant in Scotland than in England and Wales when more houses require improvement in Scotland and when we have a higher rate of unemployment among construction workers?

I am surprised at the right hon. Gentleman's question. The eligible houses in Scotland are on a much broader base than those in England. In England the eligible date is pre-1919, whereas in Scotland it is pre-1964. Obviously, considerably more houses are involved in Scotland. To suggest, as I infer from the right hon. Gentleman's question, that the Government's record on private housing is not good, is to fly in the face of the facts. During the past five years we have had 171,000 grant applications approved, compared with 41,500 approved in the previous five years under the Labour Government.

Can my hon. Friend give some indication of the scale of housing improvement grant support that the Government have provided in money terms during the past five years, and how that compares with the previous five years? Does he agree that at this stage we should be getting a better consensus between the Government and local authorities about the criteria that should be applied to improvement grant applications?

My hon. Friend asks for the figure for the past five years compared with earlier years. In cash terms, during the five years of the Labour Government £51 million was spent in this area, compared with £311 million under this Government. In real terms the Labour Government effectively spent £123 million compared with £329 million spent by this Government. Perhaps more indicative than that, is the fact that in each of the last two years this Government spent more in real terms than the Labour Government spent during their whole term of office.

On the subject of improvement grants to the private sector, will the Minister reconsider his policy for those who have had the cavity wall foam insulation process carried out in timber-framed houses, in that he will not at present allow them specific grants for it to be removed unless that process is part of a general improvement and repair process that qualifies for grant? Many of the houses in the Highlands where such work has been carried out are comparatively new, and therefore do not require other improvements. Will the Minister put pressure on the building societies, in the light of the Building Research Establishment report, not to take such a severe line on mortgages on the subsequent resale of property as a result of the process? Will the Minister reconsider his policy?

I shall obviously take account of what the hon. Gentleman said in the second part of his question. He and I have corresponded on the first part, and I have made clear to him the criteria for grants. When we publish our consultation paper, I think he will find that we are looking at the whole area of improvement grants on a much broader basis.

Solicitor-General For Scotland

Travelling People (Crown Office Attitude)


asked the Solicitor-General for Scotland if he will undertake a review of the Crown Office attitude to complaints against travelling people, and invite representations from local authorities, the police and public

The policy in relation to complaints of unlawful encampment is reviewed from time to time and has recently been revised to link toleration to achievement by local authorities at district level of the provision of pitch targets. As I informed my hon. Friend on 31 October 1984, complaints against travelling people of other breaches of the law are normally dealt with by the police and procurators fiscal in the normal way.

Accepting that the Scottish Office as well as the Law Officers have an important responsibility in this matter, does my hon. and learned Friend agree that if all travelling people were well behaved and good neighbours there would be very little problem in their finding sites? Does he further agree that during the past year or so there have been examples of incidents and behaviour which entitle us to consider bringing to an end the quite extraordinary privileges which travelling people have in being able to settle anywhere in encampments regardless of planning considerations, environmental health and property ownership, and free of rent and rates?

As I have said before, and wish to emphasise again, the toleration policy extends only to unlawful encampment and does not in any way extend to other breaches of the law. The travelling people, as much as anyone else, are under the ordinary obligation to ensure that they observe the law of Scotland. My hon. Friend will also be aware that where there are large, random groups moving around the country in a nontraditional pattern the toleration policy observed in the past does not apply.

In this year of youth, is it not quite disgraceful that many youngsters are forced to be regarded as travelling people simply because they are looking for jobs? Is not the DHSS being encouraged to lean on them and to make it intolerable for them to exist as human beings? Is it not true that these youngsters—the new travelling people — deserve to be protected? They deserve basic rights, just like anyone else — just like tinkers, and I do not knock tinkers by any means. If this Government lead in anything, will they come forward—dare I ask?—with a youth charter to support and protect those youngsters who form a lost generation in Scotland today?

If the hon. Gentleman has a point, it is certainly nothing to do with the problem that we have in Scotland of trying to accommodate traditional travelling people, who have encampments in various areas. I would have thought that those of us who are aware of the problem would want to ensure that the provision of sites throughout Scotland for travelling people were established. What the hon. Gentleman raises has nothing to do with that very real difficulty.

Housing Benefit


asked the Solicitor-General for Scotland how many prosecutions there have been in Scotland in the last year for fraud in relation to the housing benefit system.

Precise figures are not available, but inquiries with procurators fiscal indicate that there have been approximately 15 such cases.

I am interested to hear that reply. Is the Solicitor-General aware of the abuse of the housing benefit system by slum landlords in Glasgow? We understand that in some cases the abuse goes over the borderline into deliberate fraud. I do not expect the hon. and learned Gentleman to comment on individual cases, but will he give me an assurance that where evidence of fraud is obtained the full rigour of the law will be applied and the landlords concerned prosecuted?

I am aware both of the matters that the right hon. Gentleman has raised and of what was in the Glasgow Evening Times. He will appreciate that although the matter is not sub judice it would be inappropriate for me at this stage to comment specifically on the allegations that have been made. I confirm to him that although I am not in a position to make any comment immediately, he may take it that the matter is being carefully investigated.

Does the Solicitor-General know that since my days as a councillor in Glasgow there have been complaints about the company mentioned in the GlasgowEvening Times? The complaints are still continuing in my constituency. I have heard tales of people's belongings being thrown out on to tenement landings and of the locks being changed on the doors. Surely as a Minister of the Crown the Solicitor-General should investigate these matters. He should ensure that tenants are properly protected and that we do not go back to the Rachman landlord system.

Again, I have to say that it would not be appropriate to make comments on the particular company, nor do I know how long that company has been in existence. I emphasise that the reserve I place on my remarks is not idle. I am aware that serious allegations have been made, including those that involve harassment of tenants, which would be illegal under the Rent Acts.

Defence Policy


asked the Solicitor-General for Scotland whether he will publish in the Official Report the full text of complaints lodged with procurators fiscal alleging the illegality of Her Majesty's Government's defence policy and the reason why no action was taken.

In view of the complaints lodged with the procurator fiscal at Stirling by students at Stirling university to the effect that, under the terms of the Geneva convention, it is a crime in international law to target the civilian population, and in view of the fact that the Government's nuclear arms policy presents a threat to the civilian population as well as to military personnel, is there not at least prima facie evidence for bringing a prosecution against the Prime Minister and her Government for conducting a defence policy that is criminal?

There is no general multilateral convention outlawing nuclear weapons, nor under international law is the use or possession of nuclear weapons prohibited. Indeed, the existence of such treaties as the one on non-proliferation would seem to indicate implicit acceptance of the legality of possession of nuclear weapons by some nuclear states. In any event, I would scarcely have thought that Stirling sheriff court was the appropriate forum to arraign before it every Prime Minister and Secretary of State for Defence since this country acquired a nuclear capability.

Does my hon. and learned Friend not regret these misplaced and misguided attempts to bring into the judicial sphere that which correctly belongs to the political sphere? Does he agree that the electorate of the United Kingdom wholeheartedly endorse the Government's defence policy?

My hon. Friend is right. What is being sought by the question and by the approach that was made to the procurator fiscal is the introduction of a political element into legal proceedings. In any event, as I have sought to emphasise, it is the view of the Government that the possession of nuclear weapons is not a breach of international law.

Procurator Fiscal (Staff Vacancies)


asked the Solicitor-General for Scotland if he will list the vacancies in the Procurator Fiscal's Department.

As at 31 May 1985 there were vacancies for five legal assistants, one executive officer and nine typing posts.

Because of the worsening working conditions of the service of the Procurator Fiscal in Scotland, has the Solicitor-General had any indication from the staff that they intend to take some form of industrial action, which may culminate in strike action, to pursue their claims? If they put pickets on a Crown Office building, which police force will monitor their activities?

Unfortunately for the hon. Gentleman, he got the wrong answer. He was anticipating that the number of vacancies would be increasing rather than decreasing. In any event, such is my respect for the procurator fiscal service as a whole that I have no doubt that industrial action of the sort that he suggests would be considered wholly inappropriate.

Crime Statistics (Strathclyde Region)


asked the Solicitor-General for Scotland how many prosecutions there were for crimes and offences in Strathclyde region in 1984; and how this compares with 1983.

Provisional figures for 1984 indicate that 103,150 persons were proceeded against in Strathclyde region for crimes and offences. This compares with a figure of 114,336 for 1983.

Does my right hon. and learned Friend agree that, if Strathclyde regional council brought the Strathclyde police force up to established strength, more police on the beat would do a great deal to detect crime and so increase the number of prosecutions? Does he further agree that Strathclyde regional council's refusal to increase the number of police is profoundly damaging and wholly unjustified?

Yes. Although I have said that there is a decline in the number of people proceeded against, I should have thought that there was nothing in that figure to justify the action being taken to withhold from the chief constable the funding that he needs to bring his force up to full strength. I understand that there is a shortfall of about 200 police officers and 704 civilian support staff in Strathclyde region.

Would not the statistics concerning those proceeded against in Strathclyde courts for drunkenness and related offences be improved considerably by the establishment of designated places?

The action that has been taken in Aberdeen has shown that the problem can be dealt with much more satisfactorily in that way. If the hon. Gentleman examines the figures that I have given, I believe he will appreciate that what my hon. Friend the Member for Strathkelvin and Bearsden (Mr. Hirst) said was valid.

On a point of order, Mr. Speaker. My point of order concerns Question 15, which I had hoped to have the opportunity to ask, and a significant mistype. The mistyped word is "liability". I had no intention of asking about the liability of the Scottish salmon fishing industry, but wanted to raise the issue of its viability. You will be aware, Mr. Speaker, that good beats of Scottish salmon rivers have never seen fewer salmon—

Order. I am not aware of that and I am sorry that we did not reach the hon. Gentleman's question. We did not make very good progress today. However, I have done my best to call those hon. Members who tabled questions lower on the Order Paper. I shall ensure that the correction is made.

On a point of order, Mr. Speaker. It has not escaped your notice that, in spite of your excellent efforts, we managed to get only as far as Question 9 today. So that we might proceed more quickly and ask more questions of Scottish Ministers, who represent the equivalent of seven United Kingdom Departments and a wide range of issues—we did not reach some important questions today, such as that on the salmon industry and one on Pratt and Whitney, in which I was especially interested—would you consider refraining from calling some Conservative Members again and again when there are only a handful of them and when some of them have not tabled questions at all? Would you also consider making representations through the usual channels to the effect that Scottish Question Time should take place more frequently than every four weeks? The Welsh are able to question their Secretary of State every three weeks and I think that we should be doing it at least every fortnight.

If the hon. Gentleman looks at the Order Paper, he will see that I gave preference, as is my practice, to those hon. Members with questions on the Order Paper. [Interruption.] Order. If the hon. Gentleman is referring to hon. Members from English constituencies, may I say that they have as much right to take part in Scottish Question Time as Scottish Members have to take part in English Question Time. I called some of them today, though I think not as frequently as I called Scottish Opposition Members. If the hon. Gentleman consults the Order Paper, he will see that I made a judgment on important issues in Scotland and that hon. Members with questions further down the Order Paper were called.

Further to the point of order, Mr. Speaker. I understand that the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) has just drawn attention to the fact that, unusually, I do not have a question on the Order Paper today. The reason is quite simple—

Order. I cannot think that that is a matter for me. I hope that the hon. Gentleman is not dissatisfied with being called three—or was it four, times?

Questions To Ministers

On a point of order, Mr. Speaker. Yesterday at Question Time, during the course of the questions and answers on the National Health Service, I raised the issue of a young girl in my constituency, Sara Kelly, aged 22 years of age, who had died, with reference to the fact that she had needed an nebuliser under the NHS scheme. I was told by the Minister—indeed, the House was told by the Minister—in answer to my question:

"The hon. Member"—
he was referring to me—
"therefore immediately turns to another story, that of a girl in Pinxton. That is why the hon. Member asked his question, because he has not put it to me before … We can sort out the problems if the hon. Member will put the cases to us in a proper way and not seek to exploit them for his own purpose."—[Official Report, 18 June 1985; Vol. 81, c. 163.]
The clear implication of that was that I had never raised the case of Sara Kelly with the Ministry. The fact is, of course, that on 1 May, before Sara Kelly died, I wrote to the Department of Health and Social Security and asked for an investigation into the case of the nebuliser. I was calling upon the Minister to provide a nebuliser for Sara Kelly at that time. Some days later I received a telephone call from Sara's parents telling me that she had got a nebuliser, but unfortunately had passed away. I got a reply from the DHSS on 7 June—

Order. Could the hon. Gentleman make his point of order to me, because it seems to me that this point of order is rather more for the Department than it is for me?

The point I am making, Mr. Speaker — and I am absolutely certain that my hon. Friends understand it—is that the Minister misled the House. He was saying to the House yesterday that I had never raised the question of Sara Kelly in the proper fashion, and I have a copy of the reply of the Parliamentary Under-Secretary of State for Health and Social Security, the hon. Member for Oxford, West and Abingdon (Mr. Patten) of 7 June. I rang up the DHSS yesterday and asked whether they knew that their Minister had misled the House. He has a duty to come to the House and rectify the matter, but he has not got the guts to come.

Order. These are not points of order for me. The Minister who was answering at the Dispatch Box yesterday is here and I am sure that, if the hon. Member will give him an opportunity he will wish to say something.

Further to that point of order, Mr. Speaker. I accept that yesterday I unintentionally made an unfair comment about the hon. Member's constituency case. I came to the House armed with the particulars of two cases with which he had been dealing and one on which I had been corresponding with him. I thought that I had complete knowledge of the cases that he had raised. I therefore, I am afraid, misunderstood what he said and thought that he was raising a new case about which I had not heard before. He quite correctly says that he had written to the Department on 1 May and received a reply from my hon. Friend the Parliamentary Under-Secretary. I afterwards discovered that the hon. Member was not, as I had believed, raising a totally new case.

I have written the hon. Member a letter apologising for that and saying that it is an open letter. I am sure that he can reassure his constituents that he had raised the case in the proper way. I also repeat my undertaking to him yesterday to try to sort out the remaining cases that he has, and I believe that if he continues to pursue his constituency cases we shall be able to sort out the problems in Derbyshire.

Scottish Estimates


That the Estimate Class XVIII Vote 5, Rate Support Grants to local revenues, Scotland, be referred to the Scottish Grand Committee.—[Mr. Archie Hamilton.]

Consumer Guarantee Protection

3.34 pm

I beg to move,

That leave be given to bring in a Bill to oblige traders offering long-term guarantees when providing goods or services to make suitable arrangements to ensure that such guarantees remain effective in the event of the trader ceasing to trade.
Adam Stewart is a retired constituent of mine and he and his wife like nothing more than to sit in their home and admire their garden. Some months ago they succumbed to the blandishments of a salesman from Coldshield Double Glazing and spent a lot of their life savings installing double glazing in their home, largely relying upon an assurance they were given by the salesman of a five-year guarantee for the work.

After installation of the windows, problems emerged and Mr. Stewart spent several frustrating months trying to have the work put right. Alas, in the meantime Coldshield went into receivership and Mr. Stewart discovered to his alarm and anger that his guarantee was worthless. By the time he contacted me, nothing could be done to help him.

Many hon. Members will be uncomfortably aware of similar cases and will know of the heartache, worry and financial loss experienced by people who discover that they hold worthless guarantees. Hon. Members will have experienced the frustration of writing impassioned letters to the Director General of Fair Trading, to the Minister with responsibility for consumer affairs and to the receivers or liquidators of companies, only to receive sympathy but no recourse for our hapless constituents.

The spate of insolvencies in recent years has left millions of people unprotected against defective goods or workmanship in relation to double glazing, dry rot and dampness eradication, loft conversion, servicing of domestic appliances, rustproofing, and so on. The extent of the problem is confirmed by a Which? report stating that, of 850 wood preservation firms surveyed, 600 had ceased trading two years later.

A company does not have to go into insolvency for the consumer to discover that his guarantee is ineffective. The small print often excludes apparently reasonable grounds for a claim.

These are not isolated occurrences. According to the receiver to whom I wrote on behalf of aggrieved constituents, the recent collapse of Coldshield has left tens of thousands of people with worthless guarantees. Wallguard was advertising 30-year guarantees for its damp treatment the week that it went into receivership. Servis washing machines, Multi Guarantee, Mulberry home extensions and countless other failures tell a tale of misery for people who paid good money in the hope and expectation that the work done was properly guaranteed.

The impressive growth of home ownership in recent years has been comfortably outstripped by the growth in home improvements, and many people have spent a great deal of money improving their homes—an objective that we all regard as thoroughly desirable. The private sector home improvement market is estimated to be worth about £6 billion per year. Inevitably, however, the cowboys have come in looking for the potentially rich pickings. Due to their ability to undercut reputable traders by accepting cash payment, the cowboys are believed to command about 40 per cent. of this lucrative market, with disastrous results for penny-wise, pound-foolish, home improvers who give their business to cowboys.

The guarantee is used as a hard marketing tool in advertising literature and in the sales pitch of high pressure salesmen. Purchasers believe, usually reasonably, that they are buying peace of mind and that the guarantee that comes with the goods or services gives them the right to have defective work put right during the guarantee period. Few customers are aware of the terms of the guarantee. Often they do not see the terms before they are committed to buy or the work is executed. Frequently, the guarantee turns out to be heavily qualified, excluding consequential loss, often non-transferable in the event of sale and containing other unnecessarily restrictive conditions.

A parliamentary answer last November to my hon. Friend the Member for Congleton (Mrs. Winterton) revealed a sharp increase in the number of complaints referred to the Office of Fair Trading in relation to construction, double glazing and home insulation. With complaints running at almost 50,000 per annum, the Office of Fair Trading is understandably worried about the problem and its discussion paper confirms its concern about the imperfections of guarantees and the position of holders of worthless guarantees.

In fairness, I should point out that a number of trade federations have made efforts to ensure better standards of workmanship and better guarantee cover, but despite the many worthwhile initiatives traders can still offer guarantees which mean virtually nothing in practice.

The purpose of the Bill is to simplify and strengthen the meaning of the term "guarantee" and to oblige traders who offer guarantees in excess of one year to make suitable arrangements to ensure that those guarantees remain effective throughout the entire period in the event of a firm ceasing to trade. Such a guarantee would be effected either by direct insurance between the consumer and an authorised insurer or by an approved trade association scheme or indemnity scheme which, one hopes, would have an independently insured backstop. The use of the word "guarantee" would be outlawed in all other circumstances. I must stress, however, that nothing in the Bill in any way affects the existing statutory rights of consumers under the Sale of Goods Act or the Supply of Goods and Services Act.

Most importantly, my proposals do not depend upon statutory regulation or the licensing of individual firms, nor are they designed to protect people from their own wilful stupidity. People will still be free to deal with the firm of their choice, whether it is a cowboy firm or a reputable company. Firms unable to offer a guarantee would confer on consumers no guaranteed rights and they would trade with them at their own risk. With proper publicity and the education of consumers in the risks of trading with a non-guarantee company, it is to be hoped that there would be a significant reduction in complaints of the sort which have been aired in Esther Rantzen's programmes or which have appeared on the consumers' problem pages in the tabloid newspapers.

An indirect benefit of the Bill would be encouragement for trade federations, membership of which would presumably enable a trader to obtain more competitive terms for guarantee provision. Building societies and banks also have a part to play, as much home improvement work, which is the source of so many complaints about worthless guarantees, is financed by them. They should,

if only to protect their underlying guarantee for the loan, require the borrower to use a trader offering a proper guarantee.

It is not my intention that those guarantee requirements should inhibit the small trader or the new entrant to the industry. These people would still have every opportunity to develop their businesses. I am sure that many of them grow from small beginnings by operating locally and enjoying personal word-of-mouth recommendations.

I accept that there would be an extra burden in arranging guarantee insurance, but that would be a small price to pay for the extra business which would be forthcoming from those seeking the security of a guarantee.

People may well ask whether the result of the Bill would be yet another step along the road to the nanny state. I remind the House that deposit taking, credit sales and hire purchase, and the operation of banking and insurance, are already subjected to stringent statutory control. The clients of lawyers, accountants and stockbrokers have the security of an indemnity fund. Holidaymakers are protected by a Government-funded scheme. I am looking not for Government funding but for a legislative framework to ensure that a guarantee is in reality what it purports to be.

Question put and agreed to.

Bill ordered to be brought in by Mr. Michael Hirst, Mr. Spencer Batiste, Mrs. Virginia Bottomley, Mr. Hugh Brown, Lord James Douglas-Hamilton, Miss Janet Fookes, Mr. Charles Kennedy, Mr. Austin Mitchell, Sir Hector Monro, Mr. Stuart Randall, Mr. James Wallace and Mr. Gordon Wilson.

Consumer Guarantee Protection

accordingly presented a Bill to oblige traders offering long-term guarantees when providing goods or services to make suitable arrangements to ensure that such guarantees remain effective in the event of the trader ceasing to trade; And the same was read the First time; and ordered to be read a Second time upon Friday 5 July and to be printed. [Bill 164.]

Opposition Day



We now come to the important debate on Government-imposed price increases. I have selected the amendment in the name of the Prime Minister.

3.49 pm

I beg to move,

That this House condemns the Government's policy of intentionally increasing public sector prices through rising tariffs for gas and electricity, increased rents, rates, water charges and bus fares, higher charges for school meals, meals on wheels, home helps and prescriptions, which will result in disadvantage for all but the richest sections of society; deplores the increases in private sector prices resulting from the Government's extension and imposition of higher levels of value added tax; and strongly disapproves of the Government's mismanagement of the economy which has produced record interest rates and a consequent level of mortgage repayments which for most families greatly exceeds any gains from changes in income tax.
Inflation is the area of the economy in which the Government most often proclaim victory, but an examination of the facts shows that boast to be largely bogus. For five years, the Prime Minister has claimed credit for a falling inflation rate, and has rejected all blame for increases in unemployment. In both cases, the truth is almost the exact opposite of what she asserts. That is a demonstrable fact, and it was so even before the increase in the retail price index over the past five months.

I simply draw the attention of the House to the statistics. During the past six years the British inflation rate has fluctuated between 9 per cent. above the OECD average—that was in the year in which the Government increased VAT from 8 to 15 per cent., and pushed up the RPI by four points at a stroke—and 1·8 per cent. below it. The latter figure came about immediately before the last general election.

But over the period as a whole, the average rate of inflation in the OECD has fallen from 9 to 5 per cent., whilst in the United Kingdom it has fallen from 10·1 to 7 per cent. That is a comparison of our inflation record with that of our competitors and partners in the developed world. We have certainly done no better—and, indeed, have probably done worse — than the average in the other OECD countries.

There can be no dispute about unemployment. It is a question not of perhaps having done worse but of certainly having done worse, continually having done worse and remorselessly having done worse. In 1969, United Kingdom unemployment stood at 0·5 per cent. above the OECD average. In 1980 it was 1·1 per cent. above; in 1981, 3·9 per cent. above; in 1982, 4·1 per cent. above; and in 1983, 4·4 per cent. above; and in 1984 it was 5 per cent. above the OECD average.

In the five years for which there are statistics and in the five years of this Conservative Government, our unemployment rate has continually and remorselessly increased as compared with unemployment in the OECD countries of our partners and competitors.

I shall give way to the hon. Gentleman in a moment. So far I have given only the official statistics, but perhaps he wishes to argue with them.

Was there one single month under the last Labour Government when the rate of inflation was lower than it is now?

As I develop my case, the hon. Gentleman will discover that the problem that he has to face—[HON. MEMBERS: "Answer the question."]—is whether the present rate of inflation is the lowest that the Government could achieve, or whether, through their wilful policy and despite the advantages that they have enjoyed, they have behaved in such a way as to produce a rate of inflation that is worse than that in the countries of our competitors and collaborators in the OECD. The answer to that question is a categorical yes, and I am glad that the hon. Gentleman is wisely not prepared to argue with that contention.

The contention is that, as compared with other developed countries, our rate of inflation has continually and inexorably deteriorated. That has happened at a time when commodity prices have remained relatively stable and when almost all the external factors—I draw the hon. Gentleman's attention to oil prices — have encouraged an improving inflation rate. The things that have pushed up inflation in this country during the past five months are domestic factors, just as they were in 1979 and 1981. The causes of inflation are VAT, rents, gas, electricity and, overwhelmingly, mortgages. Things that are the direct result of Government policy have escalated the inflation rate to the 7 per cent. figure at which it now stands. All the increases that I have listed have come about either directly as a result of Government edict or indirectly as a result of Government incompetence.

It is now accepted that the most immediate cause of the increase in the retail price index is the increase in mortgage rates. About that I want to ask the Chief Secretary an immediate question. If he cannot answer it now, I warn him that we expect the Secretary of State for the Environment to answer when he winds up in five hours' time.

When official statistics prove the inadequacy of Government policy, it is the Government's practice not to change the policy but to change the statistics. That happened when the retail price index was replaced by the tax and price index; that happened when the method of calculating the unemployment total was altered to give a better figure; that happened when the method of estimating the number of people in work was altered to improve the total.

Is the same about to happen with the retail price index? I understand that the retail prices index advisory committee has been asked by the Government to consider the removal of mortgage rates from the inflation calculations. That is a simple matter to which the Chief Secretary can answer yes or no. If he cannot, the Secretary of State for the Environment can answer later. Perhaps the answer is known already. I shall be pleased to give way to hear the answer to the question. Have the Government, or have they not, invited the retail prices index advisory committee to consider the removal of mortgage rates from the RPI? We look forward to the Chief Secretary enlightening us as the afternoon progresses.

Whether or not the Chief Secretary admits that what I say is true, the increase in mortgage rates played a major part in the April and May inflation increases. The May increase was described by the Secretary of State for Employment as a "blip" in a downward curve. When he made his usual statement on the unemployment figures, the Secretary of State did not say that there had been a blip in April, a blip in March, a blip in February, a blip in January — that is five blips in a row. Many commentators believe that if blips are the euphemism for upward movements, there will be another blip next month.

Five blips in a row — possibly six — requires a collective noun. The word of course is "trend". The trend has been upwards since Christmas. The trend has been established not by external factors, because commodity prices are relatively stable and the pound has not significantly deteriorated since January. The cause is domestic Government policy and the principal cause is the increase in the mortgage rates, for which the Government are wholly and directly responsible.

The story of the mortgage rates increase is well known, but it bears repetition. For 18 months, the Chancellor of the Exchequer insisted that the pound must float free and find its natural value in world markets. While he was insisting upon that throughout 1984, commentators were saying that, since oil is priced in dollars, depreciation would increase oil revenues, the oil revenue increases would extend the fiscal adjustment, the extended fiscal adjustment would increase the Chancellor's scope for tax cuts, and therefore the Chancellor was in positive favour of depreciation. Not once did the Chancellor do anything to contradict that view.

Will the Chancellor say when he contradicted the view that he welcomed depreciation? Will he give an example now? The Chancellor did nothing to contradict that judgment. As a result, on 10 January the pound seemed likely to depreciate to the value of a single dollar. As a result of that, the Chancellor stepped in on 11 January and manoeuvred an interest rates increase, which did not work.

The following day, not only the Chancellor, but all in Downing street, took a hand. At No. 10, The Observer newspaper was told that intervention to support the pound was imminent, while next door, at No. 11, The Sunday Times was being assured that intervention was out of the question. The result was chaos in the market and panic in the Government. On Monday 14 January, the Chancellor reintroduced minimum lending rates and began the process that ended with base rates at 14 per cent. and the highest real interest rates that this country has endured for 50 years.

The cause of those interest rates rising to that level was not the old theory of crowding out or the new excuse of international rates. It certainly was nothing to do with the money supply, even though the Government were not meeting their money supply targets. Interest rates in Britain are now 6 per cent. above those in Germany, America and Japan, for reasons that are special to the United Kingdom. Those reasons are and remain the incompetent management of sterling by the Chancellor and the panic that affected the Government thereafter. As a result of that unique increase in interest rates, mortgage rates rose to 13·75 per cent. and 14 per cent.—4 per cent. higher than at the time of the last election and 2 per cent. above the level that the Government inherited in 1979. In fact, those mortgage interest rates have been surpassed only once in our history, and that was under the Tory Government in 1981.

On 1 April, mortgage interest rates rose by a full 1 per cent. That added £9·60 a month to the repayments on a £20,000 mortgage, which is the average new mortgage taken out. That increase in repayments on the average new mortgage more than swallowed the £7·50 tax relief provided in this year's budget for a married couple. Thanks to the Government, during the past five years, that family with a £20,000 mortgage has faced a 4 per cent. increase in its mortgage repayments and an actual increase of £40 a month. The Conservative party, which claims to be the party of home ownership, has made home ownership more expensive than ever before.

For some families, especially young couples, the Government have made the price of home ownership prohibitive. Yet, if those same young couples want or have to live in rented accommodation, especially municipal rented accommodation, the cost has increased just as much. Thanks to the Government's decision virtually to abolish housing subsidies, increases in rents have escalated at a speed that no hon. Member, whatever his persuasion, would have regarded as tolerable five or 10 years ago. In 1978–79 — the last year of the Labour Government — the average council rent was £5·90 a week; last year, it was £14·77. The estimate for 1985–86 is £15·50 a week—an increase over seven years of 163 per cent. gross and 41 per cent. in real terms. These are massive increases which ordinary families find it almost impossible to face and bear.

The increases in mortgage repayments and in rates are borne by home owners and house renters who are desperately affected by another item of policy for which the Government are generally and directly responsible—the continuing increase in rates. I know that it is the practice of the Government's propaganda machine to blame the rates increases on individual councils. It may well be the whole absurd paraphernalia of rate capping and all that goes with it was not so much a device for holding rates down as a device for finding scapegoats on whom to blame the increasing rates.

Whatever the purpose of all these schemes introduced by the Chancellor and his many predecessors who escaped before he arrived, none has worked. Between 1974–75 and 1978–79—that is the period of the Labour Government, for hon. Members who enjoy making such comparisons—rates rose by 73 per cent. In fact, the real cost fell by 5 per cent. Between 1978–79 and 1984–85 the rates rose by 146 per cent.—the real cost rose by 46 per cent. Between the first year that this Government were in office and the estimate for next year, the rates increase will be 169 per cent.—a real increase of 44 per cent. That is 44 per cent., to which an additional escalating payment must be made for water rates, which continue to grow at a speed that is inexplicable to most people who have examined the industry.

The Government blame all this—a 44 per cent. real increase in rates plus the increase in water charges—on spendthrift councils. They justify their blame and substantiate their accusations by giving examples of items of spending which I freely admit are sometimes absurd, but which are almost always trivial in terms of a borough's total rates bill.

If councils are to blame for escalating rates, then Conservative councils are at least as guilty as Labour in local administration. I ask the Chief Secretary to consider the average domestic rates precept this year in the shire counties, where the Conservative party believes itself to hold sway and in some areas exercises undisputed power. In the 10 shire counties where Labour sets the rates, the figure is £4·83; in the 19 shire counties where the Conservatives set the rates, the figure is £5·31; and in the 10 counties where there is no overall control the figure is £5·34. By dividing the shire counties into three groups—Labour, Conservative and others—one can see that, according to the Government's criteria, the Labour party has a better record of thrift than the other parties.

I am not blaming the independents, the Social Democrats or the Liberals, who have increased the precept the most. I am not blaming the Tory councils which have increased the precept more than Labour councils. To blame them for the increase in rates would be as absurd as to blame all the other groups which have had the unpleasant task of imposing and passing on the price increases required by the Government. Those councils have increased their rates for two reasons — first, because the Government have increased councils' costs by imposing extra duties on them, such as the administration of housing benefit, and, secondly, because the Government have neglected services, such as local transport, which councils rightly thought it their duty to rescue.

At the same time as this Government have increased councils' costs, they have remorselessly and ruthlessly cut the rate support grant, which is central Government's contribution to local authority spending. In 1978–79 which was the last year of the Labour Government-this is another comparison which will be noted by assiduous hon. Members who like to make these comparisons — the RSG was £12·226 billion; this year it has sunk in real terms to £8·489 billion. If this Government had kept RSG at the level they inherited, local authorities would have received a sum so much greater than the sum they now receive that none of the increases about which there have been so many complaints would have been necessary or imposed.

In such circumstances, it is dishonest and absurd to blame the rates rises on local councils. It is as dishonest and absurd as it would be to blame the chemists for the increases in prescription charges from 20p to £2, to blame the dentists for the increased patient costs which come from open-ended charges, or to blame the opticians for the increased prices which result from the abandonment of NHS glasses and lenses. The Government are responsible for all those items, just as they are responsible for the rates increases.

Before the right hon. Gentleman leaves the question of rates, may I ask him to recollect that the Government imposed a limit on the GLC? Does he remember that the GLC then voted voluntarily to go below that limit and announced that it was able to do that without any reduction in the standard of services being offered to the people of London? Did the right hon. Gentleman welcome the move by the Government which forced the GLC to reduce the rate, or did he believe that his friends at county hall should have been allowed to raise the rates as high as they wished?

I will now demonstrate why I said that I am always happy to give way to the hon. Gentleman. Perhaps he will recall what happened when the GLC reduced the rate below the figure that the Government anticipated. That required the Government to give more money to county hall, and because that had to be done, they had to take money away from Lancashire and every one of the shire counties.

It is no good the hon. Gentleman saying, "No", because that is exactly what happened. It is what I told the Prime Minister would happen and it is what the Prime Minister justified having happened. Because the GLC remained within the law, the shire counties, many of them Conservative-controlled, were penalised. If the hon. Member for Enfield, North (Mr. Eggar) regards that as a sensible way of distributing the rate fund, I shall give way to him frequently in the future.

The people whom I have described — those who are paying higher mortgage rates and higher rents, both of whom are paying additional rates bills—are also the people who are now faced with massive increases in the cost of gas and electricity.

I have no doubt that, when the Chief Secretary makes his valedictory speech, he will say that gas and electricity prices rose between 1974 and 1979. I congratulate him on his perception in discovering that. During the lifetime of the Labour Government, gas prices, although they increased by 73 per cent. in nominal terms, fell by 39 per cent. in real terms. Between May 1979 and August 1985, gas prices rose by 128 per cent. in nominal terms and 56 per cent. in real terms.

Electricity prices rose much more quickly under Labour than they have under the Conservatives. However, I hope that, as the Chief Secretary entertains us with a detailed recital of the figures that I have offered him, he will also give the history of those price increases.

The Labour Government of 1974 inherited from their predecessor annual losses on gas of £41 million and on electricity of £176 million. I know that it is not fashionable for the present Government to defend their lineal predecessor, and the Chief Secretary may say that many of the problems that the Labour Government faced with gas and electricity prices were the direct result of the Heath Administration. He must make his own judgment on whether he wants to offer that condemnation.

The facts are beyond dispute—a £41 million deficit on gas and a £176 million deficit on electricity—and the Labour Government moved slowly towards a break-even point. As one of the Ministers who was responsible for this area of policy, I vividly recall that the criticism of the Labour Government was not that we were putting gas and electricity prices up too quickly but that we were increasing them too slowly—that we were subsidising the gas and electricity consumer.

The right hon. Gentleman said that he always gave way to my hon. Friend the Member for Enfield, North (Mr. Eggar).

While I could not lose by giving way, I am motivated solely by compassion. Therefore, I will not give way again to the hon. Gentleman.

The Government's attitude towards the gas and electricity industries has been diametrically different from that of a Government who struggled—not completely successfully — to make the industry break even. The Conservatives have used gas and electricity to raise revenue and collect taxes, and I will quote two authorities for saying that.

I remind the Chief Secretary of what the National Gas Consumer Council said about the gas tariff:
"We strongly opposed and fought vigorously against the suggestion that the tariff should rise higher than the commercial needs of the industry in order to provide a convenient source of revenue to the Treasury."
It went on to say that its opposition to the gas industry being used
"to provide a convenient source of revenue to the Treasury"
failed and that the fight to stop the gas tax was lost. It added that the
"three-year Government imposed programme of rapid gas price rises was…a programme that more than doubled the price of gas."
The same rule applies to electricity. I have quoted the report of the Select Committee on Energy in the House before. When I last raised it in debate, the Chief Secretary did not comment on the issue. I invite him to comment on it today. That Select Committee said:
"the proposed electricity price increase…is not justified on the grounds either of the Financial Target or the Government's economic pricing policy. The only possible reason for it is the Government's desire to raise additional revenue."

I had better not give way to the hon. Gentleman, or his hon. Friend the Member for Enfield, North will feel cheated

The Select Committee added:
"the industry has been required by the Government…to make payments to the Treasury in 1984–85 of some £360 million over and above the figure of £380 million which would be consistent with Financial Targets."
The Government now impose a purchase tax on gas and electricity. It is a surreptitious tax, but it is a tax nevertheless on electricity and gas.

The right hon. Gentleman is rightly concerned about price rises. I am sure that he is keen to enlighten the House and the country on his party's policy. Do he and his party believe in a statutory prices and incomes policy, or would he have some sort of fudge or compact with the trade unions?

My answer to the alternatives that the hon. Gentleman offers me is that I do not believe in a statutory incomes policy. I do, however, believe, as I have always believed, that an agreement must be forged between unions and Government — [Interruption.] I know how concerned the Government are by the increase in wages reported today. I hope that they will understand, if they are concerned about wage increases, that they should not be surprised by today's news. If the Prime Minister preaches the doctrine of every man and woman for himself and herself, she must expect the trade unions to do exactly the same. As Mr. Sid Weighell once said:

"If we live in a pigsty economy, everybody will try to get their snouts in the trough.
As the Conservatives have encouraged the belief that every man and woman should fight for himself and herself and damn the consequences, they should not be surprised if trade unionists take them at their word.

Order. I do not think that the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) is giving way. There will be ample time for other hon. Members to contribute to the debate.

I return to the subject on which—[HON. MEMBERS: "Keep to the point."] I have not left the point. If Conservative Members will concentrate, when I say that I am returning to the point, it means that I have not left it. I am on exactly the same point.

The surpluses in the gas and electricity industries which the Government have arranged and have imposed—they would be called profits in private industry, and I suppose that they will be called profits if those industries are privatised — are used to reduce the public sector borrowing requirement. They are taxes, and they are intended to assist in the achievement of the massive tax cuts which the Chancellor pursues so frenziedly but never actually achieves.

I suspect that this frenzy will increase as the election approaches — not surprisingly from a party which promised to cut taxes but has in fact increased the annual tax bill by £29 billion. That means, I suspect and fear, that there will be additional assaults on public services such as the assault mounted by the Secretary of State for Transport in his direction to the London Regional Transport Board to reduce its level of revenue support. The assault resulted in fares being increased on average by 9 per cent., short journey fares being increased by 25 per cent. and children's bus fares being increased by 50 per cent. Those are the sort of prices that real families pay for the Chancellor's frenzied and vain pursuit of a surplus big enough to provide the tax cuts which he once promised and has failed to provide.

There will be the pathetic pretence that the problems of the economy, while all this is going on, can be solved by the belief and the pursuit of the superstitions which have so failed the economy for the last six years. I have absolutely no doubt that when the Chief Secretary speaks we will hear a repetition of all the old shibboleths that we have heard from him week in, week out, since he first became a member of the Government. He will announce that the policy which has visibly failed is really an invisible success and he will urge us to be patient, telling us that in the end the policy which has so damaged the economy will save the economy. To most people the absurdity of that blind faith is now obvious.

We were once told that, if the Government held down inflation, every other aspect of the economy would improve. What they have done is to attempt to hold down inflation by damaging every other aspect of the economy. The 2 million extra unemployed, the record level of company liquidations, the deficit on manufacturing trade, the net decline in investment and the negative net investment in manufacturing, construction and transport, are all the prices that we pay for the Government's belief that, if they hold down inflation, everything will come right. Not even in that particular have the Government succeeded. Not even in that promise have the Government managed to do what they asserted would be done.

The most recent of these promises was made by the Prime Minister somewhere in south-east Asia. I cannot recall the exact country—that does not matter; the right hon. Lady cannot either — but I do remember the promise. The promise was a 3 per cent. inflation rate by polling day. Therefore, I ask the Chief Secretary whether the Government are still committed to that figure or are now edging away from the Prime Minister's indiscretion. If the Government still believe that 3 per cent. is possible by polling day, let me remind them what they have to do. They have to cut inflation by 4 per cent. in the next two years. What the Government have achieved in six years is a reduction of 3·1 per cent. What they have achieved since the last election is an increase of 3·3 per cent.

Notwithstanding that, I make my position clear about what I fear most—that the Prime Minister will cynically attempt to keep her promise by further collapsing the economy, by adding to record unemployment, by adding to the number of company liquidations, by increasing the deficit on manufacturing trade and by worsening the position in transport, manufacturing and construction, where net investment is already negative. My fear is that the Prime Minister will cynically deepen the damage in the vain hope of having a least one semi-plausible claim to make about her economic record. I do not think that it will do her reputation very much good. The country no longer believes her economic prescription—how could it when so many promises have been broken and when so many forecasts have proved risibly wrong?

I conclude with one recent example. On 21 March the Chancellor spoke to the House about inflation which he said
"will stay low and will get lower."
Since then, the retail prices index has risen twice. What is more, even when the Chancellor gave his assurance on 21 March, he must have known that it was going to rise in April, but what he said to the House was that inflation
"will stay low and will get lower."—[Official Report, 21 March 1985; Vol. 75, c. 973.]
It is conduct such as that and words such as those—

The Chancellor is assuring the House that he said something different in the Budget speech. It is a sort of defence to say that one said one thing on one day and another on another day, but I do not think that it is a defence that will take him very far. I believe that it is defences like that and statements of the sort that I have just described which make the comment that the Chancellor offered the House on 21 March wholly apposite—apposite not to the inflation rate, but to the Government's reputation—that it will stay low and will get lower.

4.26 pm

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

'supports the Government's sound financial policies to reduce and contain inflation, to provide the basis for a fifth successive year of economic growth and to secure a sustained rise in living standards.'.
The motion standing in the name of the official Opposition covers an enormously wide area, in the hope, presumably, that it may hit a few targets—

The right hon. and learned Gentleman is a sitting duck for a start.

Just give me a chance to see whether I can fly. The hon. Gentleman is usually more generous than that.

In the hope that echoes of the debate may reverberate in the valley of Brecon and Radnor, the amendment attempts to give a little more coherence to the debate. The difficulty is that the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) makes most of his interesting speeches outside the House. Taking my cue, however, from his most recent interview with The Guardian, and his recent Crosland lecture at Oxford, I shall direct my remarks today to the broad priorities of the Government's economic policies and the question of nationalised industry prices.

The Government's economic policies have been clearly stated and consistently followed since the day on which they assumed office in 1979. I think that our record stands close comparison with that of other countries of the OECD and so far out-tops the record of the last Labour Government that I am rather surprised the right hon. Member for Sparkbrook should even have tabled the motion.

We inherited a situation where inflation, starting from a figure of around 17 per cent. in the autumn of 1974, which the right hon. Member for Leeds, East (Mr. Healey) represented as 8·4 per cent., had accelerated to 26·9 per cent. in 1974, before falling temporarily as a result of the short-term expediency of incomes policy. By May 1979, inflation was 10·3 per cent. and on a sharply rising trend.

Those rates of inflation were bidding fair to destroy our economic base and social cohesion. The right hon. Member for Sparkbrook will well recall those days, as he was Secretary of State for Prices and Consumer Protection from 1976 to 1979, so some of his observations had an added piquancy. He will recall the policies with which his Government tried, without success, to contain the situation. He will also recall his clear statement of priorities in February 1978, when he said:
"in terms of promoting employment opportunities throughout the country as a whole, nothing is more important than containing inflation."—[Official Report, 7 February 1978; Vol. 943, c. 1271.]
I applaud that clear statement of principle. Would that the Labour Government had applied it. I ask the right hon. Gentleman whether this is one of the old shibboleths to which he referred, one to which he has returned, or one which he has never left.

Does that quotation still represent one of the priorities of Labour party policy? The right hon. Gentleman did not touch with sufficient clarity, either in his Crosland lecture or in the interview in The Guardian, on his priorities and how he hoped to achieve them. Let me chart the Government's record on inflation.

In May 1979 inflation was 10·3 per cent. and rising, as the previous Administration's attempts to impose bureaucratic short-term solutions were collapsing. If ever there was a pigsty economy, it was in those dark winter months of 1978–79, when the noses of certain sectors of the trade union movement were in the trough and the right hon. Gentleman and his friends did nothing to remove them.

In 1980 the Government set out in place of the previous bureaucratic short-term solutions a medium-term financial strategy to promote honest finance and sound money and a sustained fall in inflation. We have stuck to our strategy, and it has been successful. Inflation has been steadily squeezed from the system.

The hon. Gentleman must learn to control himself. We are no longer in Committee Room 10.

Under the previous Administration inflation averaged 15·5 per cent. Under this Administration it has averaged 9·7 per cent. Since June 1983 inflation has averaged 6·2 per cent. Inflation is under control in a way that it has not been since the late 1960s.

The right hon. Member for Sparkbrook made much play of the upturn in the RPI figures this spring and summer. In May the RPI showed an annual increase of 7 per cent., compared to 6·9 per cent. the previous month and 5 per cent. earlier in the year. Of course these figures are unwelcome, but Opposition Members should not pretend that they come as a great surprise or signal the failure of our policies.

My right hon. Friend the Chancellor of the Exchequer made it clear in his Budget speech that he expected inflation to edge up in the middle of this year. This increase in the RPI is due largely to temporary factors and, as the right hon. Member for Sparkbrook is right to point out, mortgage interest plays a great part. The rise in inflation followed a certain upset in the exchange markets at the beginning of the year — a clear sign of the problems that would assail any Government not committed to the firm financial and fiscal policies that we are implementing.

The right hon. Member for Sparkbrook made some points about the activities of the retail prices index advisory committee. He will know, having occupied the position that he did, that this is an independent advisory committee, with representatives of the TUC, the CBI and the Government, and is to report towards the end of 1985. The Government have asked it to look at a range of factors, but if the right hon. Gentleman is suggesting that it is likely to be prejudiced in favour of the Government, he is being grossly discourteous to the independent members who form it.

No matter what I am suggesting about the advisory committee, I am asking about the Government. Have the Government asked the committee to look at the inclusion of mortgage rates?

We have asked it to look at a range of factors, including in particular the contribution made by housing.

If the hon. Member for Copeland (Dr. Cunningham) is suggesting that the independent advisory committee is likely to put its name to a figure, he should reflect a little more.

No, it is not a Government fiddle. Let me remind the hon. Gentleman, who has perhaps not considered his question as closely as has the right hon. Member for Sparkbrook, not having held the same range of posts in the last Administration, that most other countries do not include mortgage costs in their RPI.

I have given a clear and explicit answer, and these matters are for the decision and recommendation of the independent advisory committee. The right hon. Gentleman should contain himself. Does he wish to assert that the committee is not advisory and not independent? I have given a clear explicit answer to his question. If he is not satisfied with it, he should have formulated his question in a different way. He clearly has not thought through the charge which he is rather apt to throw around the Chamber.

Let me point out that every monthly statement of the RN under the last Labour Government was higher than the 7 per cent. figure recorded a fortnight ago. The right hon. Gentleman went grudgingly a little way to conceding that, but he did not deal satisfactorily with that rather striking comparison.

Will my right hon. and learned Friend say that again, because I should like to memorise it?

My hon. Friend is right. It is a simple proposition that should remain in the memories of every hon. Member, and, I hope, the electors. Every monthly statement of the retail prices index under the last Labour Government was higher than the 7 per cent. figure recorded a fortnight ago. That is the most telling and succinct epitaph on the counter-inflationary policies of the last Labour Government.

The figure of 7 per cent. still concerns us, but it also emphasises how right we have been to make the containment of inflation our first priority, to rest upon the shibboleth which the right hon. Member for Sparkbrook enunciated so admirably and clearly in February 1978.

In his Budget speech my right hon. Friend the Chancellor made it clear that we expect inflation to turn round again by the end of the year, falling to around 5 per cent., and further in 1986. We still do, and we can say this with confidence because we are sticking to our financial strategy, which we set out in 1980. Monetary conditions are sufficiently restrictive to squeeze inflation from the system. Our fiscal policy has public borrowing on a sensible track. The PSBR was equivalent to 5·4 per cent. of GDP in 1978–79. In the last financial year, despite the coal strike, it was about 3 per cent., the lowest figure since the early 1970s. For this year we are looking for a further reduction to £7·1 billion, or 2 per cent. of GDP, to underpin our strategy for lower inflation.

Of all the subjects on which the right hon. Member for Sparkbrook has touched in his speeches outside the Chamber, this is one to which he has never given a clear and succinct answer. I address this question specifically to him, as I have on previous occasions. What proportion of GDP to go on the PSBR does he regard as acceptable in the present circumstances? I shall willingly give way if he wishes to answer.

The right hon. Gentleman is shifting uneasily in his seat. The question is ludicrous for him because he cannot answer it. He has not worked out the position on that. He has not really worked through the Labour party's counter-inflationary policies.

If ours is called a dogmatic and monetarist approach, I shall plead guilty. I shall be in the good company of most of the Finance Ministers of the developed world. These are the very policies which were so strikingly endorsed at the last OECD ministerial meeting in Paris. In the words of the Bonn economic summit communiqué:
"In order to sustain non-inflationary growth and higher employment, we have agreed that … we will follow prudent, and where necessary strengthen monetary and budgetary policies with a view to stable prices, lower interest rates and more productive investment."
Does the right hon. Gentleman dissent from that and from the views of his presumed friend the President of France?

If the debate is to be more than a mere exercise in rhetoric by Opposition Members, it is right to consider what alternative policies they advocate. The right hon. Gentleman has told us, or The Guardian readers, that within days of a Labour Government taking office, whenever that may be, he will produce a medium-term economic strategy.

I am glad that the hon. Gentleman knows with such precision the day and outcome of the general election.

It is interesting to note that the right hon. Gentleman describes his policy as a medium-term economic strategy, not a medium-term financial strategy. I have got the point that the right hon. Gentleman, in his expansive way, is taking a broad view of the problem. Therefore, he should give us his broad views of the problems, instead of confining himself to one or two rather trumpery pieces of rhetoric. I hope that he will tell us what he would propose. As the hon. Member for Glasgow, Cathcart (Mr. Maxton) has told the House exactly when the general election will be, and what its outcome will be, the right hon. Gentleman will have devoted considerable thought to these matters and will no doubt produce his plan only a few days after the general election.

The right hon. Gentleman has not mentioned that plan in this debate. Nor was there a serious mention of the level of the borrowing requirement in his speech. This afternoon he resisted my blandishments again and described my question as ludicrous. Is it not a question which he would address in his medium-term economic strategy? The right hon. Gentleman did not mention the money supply. I pay tribute to him for the fact that in his interview with the Tribune on 10 May 1985 he said of the money supply:
"We shall regard it as a tool for managing the economy in the way that we want."
Perhaps he is to a tiny degree a monetarist. I welcome him to the club.

The right hon. Gentleman promises us a new form of non-enforceable social contract on pay with the trade union movement. I hope that that theme will be developed during the debate, because it will be particularly interesting to hear the views of the Liberal and Social Democratic parties. They not only believe in a social contract, but believe that it should be statutory, enforceable and extended to prices.

Will the right hon. and learned Gentleman tell the House where he picked up the words "social contract" in either the Liberal or Social Democratic party manifestos?

I apologise deeply to the hon. Gentleman if he does not fancy the words "social contract". I thought that after the years when he and his hon. Friends underpinned the Labour Government, the words "social contract" had passed into Liberal and SDP currency. Perhaps the hon. Gentleman can catch your eye, Mr. Deputy Speaker, and explore such interesting semantic questions.

Even over a period of years the country will recall the failure of those policies. For a party which has put down this motion to take as the centre plank of its policies an incomes policy, enforceable or unenforceable—either of which in the long term is unenforceable in practice—reveals a remarkable failure of memory or an obstinate incapacity to learn. We can only murmur in the words of Dr. Johnson:
"The triumph of hope over experience".
The right hon. Gentleman has been more expansive on prices. In his Tribune interview of 10 May he said:
"I favour the reconstruction of price controls … but not blanket price controls … the sort of selective price controls that were beginning to evolve which prevented unreasonable price increases"—
not observable to the rest of the country—
" — increases that were the product of a company's monopolistic power in the economy and which prevented exploitation—I want to see again … Some sort of control on prices ought to be one of the sanctions we used to influence industrial behaviour.
The hon. Gentleman might have enlightened us on whether he believes in some sort of statutory control or arbitrary powers such as he was prone to use in 1978, or whether he merely advocates an increased and strengthened Monopolies and Mergers Commission. It appears that, while the right hon. Gentleman has forgotten the lessons which his Government learned painfully at our expense during the intervention in our affairs of the International Monetary Fund, he remembers the one aspect of policy which failed so signally in whatever form it was introduced.

I shall now deal with the more startling charges in the Opposition's motion—nationalised industry prices. To have a sensible debate on this issue it is important to establish, or re-establish, to return to, or not to leave, the facts, because they have been stated on many occasions from these Benches. The right hon. Gentleman gave the House some of the facts, but in a highly partisan and selective form.

Domestic electricity prices increased between 1974 and 1979 under the Labour Administration by 170 per cent., while between 1979 and February 1985 they increased by 84 per cent. The right hon. Gentleman is right to draw our attention to the fact that the rate of inflation was more acute in the period in which he presided as the protector of consumers than it has been under our Government at any time.

Industrial electricity prices increased between 1974 and 1979 by 133 per cent., compared with 65 per cent.

between 1979 and 1985. Indeed, domestic electricity prices were frozen for two years to April 1984, and electricity price increases are expected to be at or below the rate of inflation during the next two years. In short, under the Labour Administration electricity prices increased by 2 per cent. every six weeks, whereas under the present Government they have increased by 2 per cent. during the past two years. I hope that my hon. Friend the Member for Harrow, West (Sir J. Page) will also record that particularly important point.[Interruption.] My hon. Friend can read Hansard, but hon. Gentlemen may be more disadvantaged.

Between 1974 and 1979, industrial gas prices rose by 288 per cent. If the competitiveness of British industry was a concern of the right hon. Gentleman, that is an extraordinary figure. Between 1979 and 1985, the increase was only 94 per cent.

Between 1974 and 1979, domestic gas prices increased by 73 per cent. Because gas remained substantially under priced in economic terms, which created severe distortions in the market, gas prices had to be increased in real terms during the following three years. Once that step had been taken, gas prices rose no faster than inflation. Domestic gas prices did not increase during the 15 months to January 1984, and Sir Denis Rooke told the Select Committee on Energy on 20 November 1984 that he expected to be able to hold gas prices to roughly the rate of inflation for the next three or four years because of efficiency savings.

I am trying to follow the logic of the Chief Secretary's argument. Does he believe that the Labour Government were wrong to increase those prices and, therefore, approach break-even? Would he have preferred us not to do that and to leave a bigger deficit for him to deal with when he came to office?

I am coming to the principle. I am sure that the right hon. Gentleman, who is well known for his courtesy in debates, will allow me to develop my speech. There is an important principle to be debated here. I hope that we will be able to establish a little common ground between the two sides of the House on the principle by which nationalised industry prices should be regulated. The right hon. Gentleman is right to say that we should focus on the general principle, and I shall derive much support from the White Paper which the Labour Government produced in 1978.

If the hon. Gentleman will allow me, I shall develop my speech. I am sure that he wants to make a relevant intervention, but I hope that he will have an opportunity to catch your eye, Mr. Deputy Speaker.

Under the Labour Administration, domestic water charges increased by 86 per cent., while between 1979 and February 1985 they increased by 83 per cent. Opposition Members will no doubt object to the fact that water charges are to be increased by about 11·5 per cent. this year, but they may have overlooked the fact that under the Labour Government the water authorities' investment declined by a third in real terms, while between 1979 and 1983 investment increased by a sixth in real terms.

In 1984–85 capital expenditure was about £750 million, and it will increase by almost £200 million by 1987–88. The right hon. Gentleman was anxious about the levels of investment. I remind him that during the last financial year there were record levels of investment across the country totalling about £55 billion, and that is likely to be matched this year. I have drawn his attention to the figures for the water industry. That is why we have planned for higher water charges. Following a summer of drought last year, I hope that the country will see the good sense of that. It is pointless advocating increased investment in infrastructure if measures to pay for it are not supported.

I come now to the point raised so perceptively by the hon. Member for Copeland—to reflect on the principles which should underlie the pricing of nationalised industries. I assume that both the last Labour Government and this Government accept that the prices that industries charge should cover their marginal costs of supply, including a satisfactory return on the capital they employ. In case Opposition Members have forgotten, the energy policy Green Paper presented to Parliament by the right hon. Member for Chesterfield (Mr. Benn) in February 1978—I am sorry that he is not here to contribute to the debate—said:
"Energy prices should give both consumers and producers reasonably accurate signals about the costs of energy supply".
Those are impeccable economic sentiments.
"Underpricing encourages consumers to waste gas resources … prices should therefore at least cover the cost at which supplies can be provided on a continuing basis, while yielding an adequate return to investment."
I really wonder what we are debating.

If Opposition Members ask what is a reasonable return on investment, I can only refer them to the nationalised industry White Paper of March 1978, which indicated that the required rate of return on investment should, in normal circumstances, be 5 per cent. in real terms.

I have to admit that the required rate of return on capital for the gas industry, under its targets, is about 4 per cent., for the electricity industry about 3 per cent., and for the water industry under 2 per cent. That leads me to cite the well-worn words of Clive of India:
"I am astounded at my own moderation."

If I were to send the Treasury the evidence that West Lothian district council gave yesterday, figures and all, on the loss of income tax and many other related benefits in relation to the Polkemmet closure—which is the subject of a major public inquiry about the pit that was flooded—would I be assured of a full answer once the Treasury had the figures?

I should not like to commit myself until I have seen the hon. Gentleman's letter, as it may not be entirely a matter for my Department. I understand what the hon. Gentleman is saying about tax loss. I hope he recognises that whenever he and I have corresponded I have endeavoured to answer his questions very fully. I shall look at his letter, and if parts of it are matters for my right hon. and hon. Friends, I hope that he will forgive me if I pass it on to them.

Will my right hon. and learned Friend inform the House whether the figures for the rate of return on capital are on a current or a historic cost basis?

We have been talking about revenue loss. There is one other statistic which I should like my right hon. and learned Friend to give me, which I could memorise and pass on to my constituents. How much has been lost to the country and to the energy industries as a result of the strike last year, led by Arthur Scargill and aided and abetted by Opposition Members?

My right hon. Friend the Chancellor of the Exchequer in his Budget, gave the best figure that we were able to provide for last year. It is a little too early to say exactly what the consequential costs will be for this year. If my hon. Friend tables a question later in the year, I hope to be able to oblige him. The figure will certainly be in hundreds of millions, not tens of millions.

The debate is clearly about prices, costs and comparisons between this Government and the previous Labour Government. The one cost to which the Chief Secretary has not referred——and he should have done—is the human misery inflicted by the Government's policies. Will he make a comparison between the unemployment rate during the last 15 months of the Labour Government—when it was falling steadily—and the figure after six years of this Conservative Government, when 2 million more people are unemployed? If, as the Prime has suggested, getting inflation down to 3 per cent. will cost another 1 million jobs, will the Chief Secretary support that? Is that the price that we will have to pay?

I hope that I can deal with that intervention as courteously as I know how. If the hon. Gentleman will cast his mind back—although I do not know whether he was in the Chamber—he will recall that his right hon. Friend the Member for Sparkbrook said that the first priority for employment was the containment of inflation. That is my answer to the hon. Gentleman.

Even a most cursory examination of the facts must show that this is a most ill-conceived Opposition motion. The Government's record in reducing and containing inflation since 1979 is vastly superior to that of the previous Labour Government. Despite the last few months' figures, there is little reason to doubt that the RPI will be back on a declining path before long.

Our methods are plain and proven. We have a consistent strategy, which we have sustained for the past five years, and which we will sustain through the next five years. In 1980 we set out a medium-term financial strategy to promote honest finance and sound money. We have stuck to it and concentrated on what Governments can realistically influence. We have secured monetary conditions which are sufficiently restrictive to squeeze inflation out of the system. We have buttressed those with a fiscal policy which has put public borrowing on a sensible downward path.

Nor is there any conflict between reducing inflation and creating more jobs. The one is dependent upon the other, as the right hon. Member for Sparkbrook recognised in February 1978 and, perhaps more authoritatively, as the Bonn summit recognised in its communiqué. We reject, as the country has rejected on various occasions, the distortion, the inefficiency, the bureaucratic complexity of price controls, wage controls and dividend controls.

The Labour party — whether inside or outside the Chamber — has offered us nothing but a torrent of synthetic indignation and a tepid rehash of the policies of yesteryear.

The alliance, perhaps recalling the Lib-Lab pact of the 1970s out of which it was conceived, has offered us a statutory prices and incomes policy—so much for its moderation, detachment and imagination. Our policies have been proved and they have yielded results. They provide a framework of success and stability for the years to come.

I invite my right hon. and hon. Friends to reject with contempt the Opposition motion and to support the Government amendment.

4.58 pm

Alliance Members welcome the opportunity provided today by the Labour segment of the Opposition to debate one of the most important indicators of Government economic policy—an indicator at the sharp end where things matter to people, not one of those intermediate targets discussed in terms of witchcraft and voodoo that have fatally beset Treasury Ministers during this and the previous Tory Administration.

It will be of interest throughout the country that at last the House of Commons is debating prices rather than monetary aggregates. The people of mid-Wales will listen to the debate on prices with rather more satisfaction than hitherto when they have had to listen to stories about M3 —which, when that proved to be a useless indicator of money, was changed to MO, which has now proved to be even more useless. We await the next fantastic indicator of monetary aggregates that the Government may dream up.

It is also a good time for the debate because, as everybody knows, the Government's medium-term financial strategy lies in ruins. The Financial Times this morning pronounced a stately funeral oration on the Chancellor's policies. The question of the hour, which I suppose will not be answered in today's debate, is how the Prime Minister can find someone reckless enough to come in to sweep aside the witchcraft and try to get the show on the road in reasonable economic terms. She has little time left before the run-up to the general election in which wholly to recast her financial and economic policies.

Some of the worst manifestations of state-imposed prices flow from the appalling mismanagement of interest rates during the regime of the present Chancellor. This country has the highest nominal interest rates of any major European country, or of Japan or the United States, except for Italy. Not only mortgage interest but interest paid by new and struggling business men has become crippling and has led to a record rate of bankruptcies and liquidations.

The Government orate about competition, but they are destroying real competition in many spheres of business. It is not the cash-rich monster companies or the companies that donate so generously to what they consider to be a Conservative party suffering from the record high real interest rates, but the very engines of competition, the small new businesses, the up and coming businesses, whose directors do not sit in lordly state but take their coats off, and, if they have to have a board meeting, have it in the gents because they are really running the business and making it go. Now many of them are going to the wall, not because of their own failings but because of the extortionate demands of the banking system.

I am sure that we would all like to see lower interest rates not just for small businesses but for everyone. Having castigated the Government, does the hon. Gentleman agree that the two major influences on interest rates — oil prices and interest rates in the United States — are outside the control of the Government?

It is late in the day for the hon. Gentleman to echo the parrot cry of Treasury Ministers, who know better but have nothing else to say, that it is all the fault of United States interest rates. The hon. Gentleman must understand that prime rates today in the United States—thank goodness—are only 9·5 per cent. As everyone knows to his cost, prime commercial rates in this country are over 13·5 per cent. To blame the United States is not only years out of date but wholly fallacious.

The interest rate factor has a major effect in producing crippling price levels. Another obsession of the Government that is largely responsible is the Prime Minister's obsessive fear and hatred of any alternative centre of power. It is rumoured that she is even jealous of power at the highest level in the constitution, but that is not germane to this debate.

Wherever alternative sources of power exist, the Prime Minister is determined to root them out; hence the lunatic obsession with abolishing the metropolitan counties and the GLC. In many cases, it is local administration, local budgeting and local financial control that ensure a reasonably low level of keen pricing. The centralisation that is the driving motive of the Government, not just on Whitehall but on 10 Downing street, is pushing up the prices of a whole range of public utilities.

How can the hon. Gentleman square his concern with localising decision-making with his concern to introduce a statutory price control system?

On another occasion I should be delighted to lecture the hon. Gentleman on the fact that alliance incomes policy is decentralised to the greatest possible extent and would consist of local and regional tribunals which would make their own decisions in an arbitration fashion. If the hon. Gentleman is trying to tax us with a centralised incomes policy, he should look back to the Government of his right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath).

The cutting out of the transport support grant and the crippling of the passenger transport executives in all the metropolitan areas are having a disastrous effect on the successful policy of lower bus fares to encourage more passenger use.

By many authorities, some of them supported by Liberals.

One of the most significant giveaways in the social security Green Paper, which has just been debated by the House, is the crazy suggestion that free school meals should be abolished, and that instead the proposed family credit system should include sufficient cash to cover school meals for children of poor families. What an absurd centralisation of a service that is dealt with economically on a local basis. Anyone who reads the Daily Telegraph weekly bulletin of food costs will have noted the wide variations between different parts of the country. The provision of a uniform cash allowance, which would inevitably have to cover the higher range of food costs, instead of allowing local education authorities to carry on their duty of providing free school meals economically, would add considerably to that branch of education costs.

The Government are even jealous of the water authorities, which were the creation of a previous Conservative Administration. The Prime Minister is not content with being able to control the nominations to those authorities and the appointment of their chairmen. She is not satisfied with enabling them to fix prices secretly, without the press being allowed to attend the meeting; she wants to interfere with the price mechanism that they adopt.

No doubt all hon. Members have taken note of the shrewd observations of the chairman of Thames water authority as to how the Government frustrated his authority's intention to make only a modest price increase. The Government insisted on a negative external financing limit which forced Thames water authority to put up its prices by about twice the rate of inflation. Interference with local decision-making is a major contributor to the scandal of unnecessary price rises in these important parts of the economy.

There is an even greater evil. Many of us used to think that the ultimate in selfish cruelty was the forced feeding of Strasbourg geese to provide pate de foie gras in fashionable restaurants. The fattening of public utilities to enable the Government to sell them off to people who have wealth to spare for such investments is an even greater cruelty inflicted on poor families and on people on moderate wage levels who have to pay the higher prices so that the Government may make dramatic sales of the public utilities to their friends and to the better off.

I do not believe that even the Prime Minister's Fleet street knights will be able to disguise this scandal for much longer. The electorate will cotton on to it or smell it out soon. It is a shoddy device aimed — I think unsuccessfully — at enabling the Government to make spectacular cuts in income tax on the eve of the election.

I remind the House what the Treasury and Civil Service Select Committee had to say about this sort of dodge in its third report earlier this year:
"We are also concerned at the Government's insistence on using nationalised industries' finances to offset public expenditure … it seems likely that the nationalised industries will resort to using their monopolistic power to raise prices."
That is exactly what has happened. It is happening throughout the whole range of nationalised and public utility prices which are mentioned in the motion. The Confederation of British Industry has observed with acerbity on the penalties which large industrial users of energy have to pay as compared with their competitors.

There is another aspect of state-administered prices which must be mentioned, because it is important for our younger generation and it is not mentioned in the motion. My right hon. and hon. Friends regard the recent increases in dental charges as a savage blow to good health and sensible preventive medicine. Since the present Prime Minister came to power, dental charges have increased from £7 to £17 for a treatment, plus an open-ended 40 per cent., which could make treatment cost as much as £110. That is an absurd way to encourage heathy practices among younger people.

We need a proper mechanism for controlling and monitoring the pricing policies of nationalised industries and all other nationwide public utilities. The alliance,

given the opportunity, would ensure that all nationalised industry and public utility prices of nationwide application would be subject to specific and affirmative detailed approval in the House and to continuous monitoring thereafter.

I am a little surprised at what the hon. Member is saying about a national price for electricity and gas. Surely he is aware that although, in Scotland, especially in the west of Scotland, electricity and gas prices are marginally lower than in other parts of the United Kingdom, the total amount spent in a year on energy by people in that area is 20 per cent. higher than in the south of England. Surely that difference ought to be taken into account.

Yes, indeed, and the matter should be debated in the House. Nothing that I have said, as the hon. Gentleman will find when he reads Hansard tomorrow, suggests there should be a uniform price throughout the country. The pricing policies of these industries should be debated fully and not on some obscure order late at night. They should be subject to major and proper debate.

I must protest at the shoddy procedure into which the House has slipped recently — debating the public expenditure White Paper on a take note motion. At the end of such a debate, the Government—the Secretary of State for the Environment is the worst offender—take the House's decision as meaning approval of everything in the public expenditure White Paper. That is contrary to the facts, because the House merely takes note of the White Paper. It is also contrary to reason, because a vast area of public expenditure, including estimated local government expenditure, cannot possibly be settled in one or two days of debate. The proper procedure is to disentangle those various items into their separate components and to debate and vote on them on a substantive motion.

We shall not get out of this dreadful plight until the management of the economy is put on a realistic basis and the Government's targets are employment, prices and the exchange rate. Until there is a greater disposition to encourage locally administered pricing and local control of services, we shall not get the best bargain or the best value for money for taxpayers and ratepayers. Because the Government have signally failed on this count, Liberal Members will join the Labour segment of the Opposition in the Division Lobby tonight.

5.15 pm

The circumstances of this debate are extraordinary The public would be forgiven if they were not aware that this afternoon's debate has been called by the Opposition because they feel there is an important subject to debate. But what do we see? One duty shadow Minister on the Front Bench, I believe two Opposition Whips and someone who sits there more in hope than in anger. Such is the seriousness with which the Opposition treat this debate.

With respect to the intervention from the television personality—