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Commons Chamber

Volume 84: debated on Monday 28 October 1985

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House Of Commons

Monday 28 October 1985

The House met at half-past Two o'clock

Prayers

[MR. SPEAKER in the Chair]

Private Business

CAMBRIDGE CITY COUNCIL BILL

MERSEYSIDE DEVELOPMENT CORPORATION BILL

BIRMINGHAM CITY COUNCIL BILL

DARTMOOR COMMONS BILL

Lincoln City Council Bill

Lords amendments agreed to.

Berkshire Bill Lords

Ordered,

That the Promoters of the Berkshire Bill [Lords] shall have leave to suspend proceedings thereon in order to proceed with the Bill, if they think fit, in the next Session of Parliament, provided that the Agents for the Bill give notice to the Clerks in the Private Bill Office not later than the day before the close of the present Session of their intention to suspend further proceedings and that all fees due on the Bill up to that date be paid.

Ordered,

That, if the Bill is brought from the Lords in the next Session, the Agent for the Bill shall deposit in the Private Bill Office a declaration signed by him, stating that the Bill is the same, in every respect, as the Bill which was brought from the Lords in the present Session.

Ordered,

That, as soon as a certificate by one of the Clerks in the Private Bill Office, that such a declaration has been so deposited, has been laid upon the Table of the House, the Bill shall be read the first and second time and committed (and shall be recorded in the Journal of this House as having been so read and committed).

Ordered,

That the Petition relating to the Bill presented in the present Session which stands referred to the Committee on the Bill shall stand referred to the Committee on the Bill in the next Session.

Ordered,

That no Petitioners shall be heard before the Committee on the Bill, unless their Petition has been presented within the time limited within the present Session or deposited pursuant to paragraph (b) of Standing Order 126 relating to Private Business.

Ordered,

That in relation to the Bill, Standing Order 127 relating to Private Business shall have effect as if the words "under Standing Order 126 (Reference to committee of petitions against bill)" were omitted.

Ordered,

That no further Fees shall be charged in respect of any proceedings on the Bill in respect of which Fees have already been incurred during the present Session.

Ordered,

That these Orders be Standing Orders of the House.—[The Second Deputy Chairman of Ways and Means.]

Message to the Lords to acquaint them therewith.

Greater London Council (General Powers) Bill

Ordered,

That the Promoters of the Greater London Council (General Powers) Bill shall have leave to suspend proceedings thereon in order to proceed with the Bill, if they think fit, in the next Session of Parliament, provided that the Agents for the Bill give notice to the Clerks in the Private Bill Office not later than the day before the close of the present Session of their intention to suspend further proceedings and that all fees due on the Bill up to that date be paid.

Ordered,

That on the fifth day on which the House sits in the next Session the Bill shall be presented to the House.

Ordered,

That there shall be deposited with the Bill a declaration signed by the Agents for the Bill, stating that the Bill is the same, in every respect, as the Bill at the last stage of its proceedings in this House in the present Session.

Ordered,

That the Bill shall be laid upon the Table of the House by one of the Clerks in the Private Bill Office on the next meeting of the House after the day on which the Bill has been presented and. when so laid, shall be read the first and second time (and shall be recorded in the Journal of this House as having been so read) and shall be ordered to be read the third time.

Ordered.

That no further Fees shall be charged in respect of any proceedings on the Bill in respect of which Fees have already been incurred during the present Session.

Ordered,

That these Orders be Standing Orders of the House.—[The Secondary Deputy Chairman of Ways and Means.]

Message to the Lords to seek their concurrence thereto.

Yorkshire Water Authority Bill

Ordered,

That the Promoters of the Yorkshire Water Authority Bill shall have leave to suspend Proceedings thereon in order to proceed with the Bill, if they think fit, in the next Session of Parliament, provided that the Agents for the Bill give notice to the Clerks in the Private Bill Office not later than the day before the close of the present Session of their intention to suspend further Proceedings and that all fees due on the Bill up to that date be paid.

Ordered,

That on the fifth day on which the House sits in the next Session the Bill shall be presented to the House.

Ordered,

That there shall be deposited with the Bill a Declaration signed by the Agents for the Bill, stating that the Bill is the same, in every respect, as the Bill presented to this House in the present Session.

Ordered,

That the Bill shall be laid upon the Table of the House by one of the Clerks in the Private Bill Office on the next meeting of the House after the day on which the Bill has been presented and, when so laid, shall be read the first and second time (and shall be recorded in the Journal of this House as having been so read) and shall be committed to the Chairman of Ways and Means, who shall make only such Amendments thereto as have been made by the Committee in the present Session, and shall report the Bill, as amended, to the House, forthwith, and the Bill, so amended, shall be ordered to be read the third time.

Ordered,

That no further Fees shall be charged in respect of arty Proceedings on the Bill in respect of which Fees have already been incurred during the present Session.

Ordered,

That these Orders be Standing Orders of the House— [The Second Deputy Chairman of Ways and Means.]

Message to the Lords to seek their concurrence thereto.

Private Bills Lords (Suspension)

Ordered,

That so much of the Lords Message [23rd October] as relates to the Essex Bill [Lords], the Greater Manchester (Light Rapid Transit System) Bill [Lords], the Swansea City Council (Tawe Barrage) Bill [Lords] and the West Glamorgan Bill [Lords] be now considered.

Resolved,

That this House doth concur with the Lords in their Resolution. — [he Second Deputy Chairman of Ways and Means.]

Message to the Lords to acquaint them therewith.

British Railways Bill

South Yorkshire Passenger Transport Bill

Ordered,

That so much of the Lords Message [23rd October] as relates to the British Railways Bill and the South Yorkshire Passenger Transport Bill be now considered.

Ordered,

That the promoters of the British Railways Bill and the South Yorkshire Passenger Transport Bill shall have leave to suspend proceedings thereon in order to proceed with the Bills in the next Session of Parliament, provided that in the case of each Bill the Agents for the Bill give notice to the Clerks in the Private Bill Office of their intention to suspend further proceedings not later than the day before the close of the present Session and that all fees due on the Bill up to that date be paid.

Ordered,

That on the fifth day on which the House sits in the next Session the Bills shall be presented to the House.

Ordered,

That there shall be deposited with each Bill a declaration signed by the Agents for the Bill, stating that the Bill is the same in every respect, as the Bill at the last stage of its proceedings in this House in the present Session.

Ordered,

That each Bill shall be laid upon the Table of the House by one of the Clerks in the Private Bill Office on the next meeting of the House after the day on which the Bill has been presented and, when so laid, shall be read the first, second and third time and shall be recorded in the Journal of this House as having been so read.

Ordered,

That no further Fees shall be charged in respect of any proceedings on the Bill in respect of which Fees have already been incurred during the present Session.

Ordered,

That these Orders be Standing Orders of the House—[The Second Deputy Chairman of Ways and Means.]

Message to the Lords to acquaint them therewith.

Associated British Ports (Port Of Ayr) Order Confirmation Bill Lords

Church Of Scotland Trust (Amendment) Order Confirmation Bill Lords

Considered; to be read the Third time.

Oral Answers To Questions

Energy

Productivity

1.

asked the Secretary of State for Energy if he will make a statement on the relative changes in productivity in the energy industries since 1980.

Labour productivity generally in the public sector energy industries has improved since 1980. I hope this progress will continue.

I am glad to hear that productivity has increased, but is my right hon. Friend happy that, in July this year, his Department could not say by how much productivity in the gas, coal and electricity industries had increased since the end of 1980, nor could it compare their productivity with the economy as a whole? Are not those figures vital to all British industry?

It is important to ensure that any figures provided are meaningful. It is difficult to provide such figures for different industries with different capital intensities and different balances between output and labour and capital use. However, I understand my hon. Friend's concern, and would be happy to discuss the matter further with him.

May I ask the Minister a question about the important offshore oil and gas industries? In recent times, what changes in productivity have there been in the offshore construction yards, and is it likely that those yards will receive contracts for offshore structures within the next eight to nine months?

I do not have the exact figures for which the hon. Gentleman asks, but I am delighted to say that our oil fabrication yards have had a good record in recent months and have won a major share of orders from oil industry in the face of fierce international competition. In that respect, their productivity is high.

Has my right hon. Friend discussed North sea oil production with representatives of OPEC? Does he agree that, although there are obvious attractions in a falling oil price, excessive production at a time of falling prices worldwide could lead to a disorderly market?

Any large cut in production would cause a reduction in productivity. Our main concern, as I have said many times in the House, has always been to ensure stability in the oil market. In an area such as the North sea, where risks are great and capital investment is high, it is important to have as stable a market as possible so that such investment continues.

Is my right hon. Friend aware that the British Gas Corporation makes no comparisons between the productivity of its men in small-scale distribution work and that of private contractors in reaching a decision to take work from the private sector and do it in-house? Does he agree that that is disgraceful?

Attention has been drawn to that matter from time to time. If there is any sign of unfairness in that area, I hope that my hon. Friend will urge those who think that is the case to draw it to the attention of the Office of Fair Trading.

Coal Supplies

2.

asked the Secretary of State for Energy what is the level of coal supplies held at power stations.

The latest published figures are for the end of July. They show stocks held at power stations in Great Britain at 18·6 million tonnes.

Although my right hon. Friend does not run our coal industry, will he follow the example set by his predecessor and encourage the National Coal Board and the Central Electricity Generating Board to build up stocks of coal at both pitheads and power stations so that the resolve of people, particularly miners, who want to continue to work, if there is an industrial dispute, is not undermined by the threat of power shortages?

Electricity boards recognise the importance of having good stocks at power stations. The figure is for the end of July, and as August, September and October are the months in which stocks build up fastest, I expect that the next published figure will show quite a big improvemet.

Is there anything about the level of coal stocks which shows the need for an increase in electricity prices beyond the rate of inflation?

National Coal Board (Enterprise) Ltd

3.

asked the Secretary of State for Energy if he will make a statement on the progress of National Coal Board (Enterprise) Ltd. in providing alternative jobs in mining areas affected by pit closures.

My right hon. Friend announced at the end of July that the funds available to NCB (Enterprise) Ltd. the job creation subsidiary of the National Coal Board, had been doubled to £20 million. In its first year of operation the company has created more than 2,500 job opportunities throughout the coalfields. One hundred and eighty-six projects have been given direct financial assistance, and many more projects are being examined. The company is working closely with new and existing enterprise agencies.

Is the Minister aware that at the Houghton careers office 328 people are registered unemployed, 210 youngsters are on short-term schemes, and there are two job vacancies, yet Eppleton pit is being merged with Murton mines, losing 700 jobs, Lampton coke works was informed at the weekend that it is to close, losing a further 226 jobs, and Ellington pit, according to the latest NCB report, is under a three-monthly review? Why is my area being sacrificed on the altar of monetarism? The £20 million is not enough for my constituency, never mind the rest of the coalfields.

The hon. Gentleman should put the other side of the picture in the north-east. I have had the opportunity of going underground at the coalface in Ellington and Wearmouth during the last few weeks. The spirit there is welcome, productivity records have been broken, and the coal industry in the north-east has terrific opportunities ahead. Both the chairman, Mr. Spanton, and the chief executive, Mr. Hewitt, of NCB (Enterprise) Ltd. take a deep personal interest in the problems of mining communities in the north-east. Already 248 job opportunities have been created there.

Further to my hon. Friend's first answer, does he agree that more publicity needs to be given to those achievements to dispel the impression that nothing is being done for communities where pits are closing?

I am grateful to my hon. Friend for giving me a further opportunity of stressing the achievements of NCB (Enterprise) Ltd. to which the Government attach significant support. Jobs created through projects that are financially supported by NCB (Enterprise) Ltd. have risen this month to a rate of 500 a month.

Is the Minister aware that since the strike ended the NCB has announced a further 3,000 job losses in Barnsley district because of further pit closures and mergers? Is he aware that that will increase unemployment in my district to 22 per cent.? What will NCB (Enterprise) Ltd. do to assist Barnsley and district in its plight? What additional assistance can his Department give to assist the Coal Field Communities' Campaign to help the distressed mining areas?

I hope that the right hon. Gentleman is reassured by the level of commitment that the Government are giving to NCB (Enterprise) Ltd. and that NCB (Enterprise) Ltd. is showing to communities, which, everyone accepts, are facing extremely serious problems.

Can my hon. Friend confirm that there will be no refusal by NCB (Enterprise) Ltd. of good and worthwhile projects which are put to it on the ground of limitation of funds, and that any good job creation scheme in an area of pit closures will be considered favourably?

I am happy to give my hon. Friend that reassurance. If hon. Members on either side of the House have any projects in mind, they should discuss them urgently with NCB (Enterprise) Ltd.

The Minister has assured the House repeatedly that there will be alternative jobs in other pits for men whose pits are closing. Does he agree that that is not strictly true? In effect, he is de-skilling certain jobs, which means that men are not being offered comparable jobs in the industry. There is a target of 350 jobs under the scheme for the whole of Wales, and in my constituency 28 per cent. of the male work force is unemployed. The position has been made worse by a recent pit closure. Will the Minister concede that the scheme is unrealistic?

The hon. Lady should recognise that the National Coal Board has, contrary to the expectations of many, been able to keep faith with its pledge of no compulsory redundancies. It is to be applauded for that. Like the hon. Member for Houghton and Washington (Mr. Boyes), the hon. Lady has failed to put the other side of the picture. A few weeks ago, I had the opportunity to go underground at Lady Windsor, Abercynon, which is in the hon. Lady's constituency. I found the spirit of the work force to be excellent. The men are reducing the cost of producing coal and they have a great future provided that coal can regain its place competitively in the market.

Is my hon. Friend aware that my constituency was badly affected by numerous pit closures some years ago when there was no enterprise company and no thumping redundancy payments? We simply had to get on with it. As a result, our unemployment rate has consistently been half that of the national average. Does my hon. Friend agree that the best advertisement for any area is a skilled and willing population that wishes to work, not strike?

I am grateful to my hon. Friend for making those important points. Let us not forget that over 11 years previous Labour Government's closed 330 pits, with compulsory redundancy and no enterprise company.

Does the Minister recognise that the £20 million which is available under the scheme only scratches the surface, especially in areas such as the one that I represent where 42 per cent. of all youths aged under 24 years are unemployed? Is the Minister aware that of the coal mines that are operating not one has on its books a boy under the age of 18? No boy has been signed on from school since 1983. There is no evidence in my area that the enterprise scheme is doing any good or attracting any companies into it.

The hon. Gentleman must realise that NCB (Enterprise) Ltd. started with a capital of £5 million, which the Government doubled to £10 million and then doubled again to £20 million. More money will be made available as and when necessary. I urge Labour Members to contact NCB (Enterprise) Ltd. and to discuss with it vital projects in their areas.

We are saying that the money is necessary now. The hon. Gentleman has spoken of 2,000 jobs having been created, but 2,000 jobs have been lost in the mining industry in the Welsh coalfield since March. The efforts that have been made do not compare with the demands and the needs of our community. Will the Minister tell us that he will accelerate his programme to match the acceleration in pit closures?

The Government have made it clear to NCB (Enterprise) Ltd. that more money will be made available as and when necessary. I urge Labour Members to discuss with NCB (Enterprise) Ltd. the strategic problems in the areas that they represent instead of criticing it.

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

Coal Industry

4.

asked the Secretary of State for Energy when he expects to announce a new "Plan for Coal".

Discussions are taking place to agree the strategy for coal. We are endeavouring to agree a strategy that will provide coal at economic cost to the consumer and a good future for the industry.

Is my right hon. Friend aware that the original 1974 "Plan for Coal" failed on several important counts—productivity, demand estimates and estimates of pit closures? Does not the National Coal Board's new strategy represent a much more realistic set of targets based on achieving a profitable and expanding industry founded on competitively priced coal?

Yes. I think that one of the great ptities of the original strategy was the total lack of performance in terms of productivity targets. I hope that productivity will improve substantially. Productivity improvements will give the best prospects for the coal industry.

What progress, if any, has been made in the negotiations between the right hon. Gentleman's Department, the NCB and the NUM about establishing a new, independent appeals procedure to hear appeals on colliery reviews concerning proposed pit closures? I understand from what the right hon. Gentleman said to me on 19 June and 4 October that the bodies are nearing agreement. What is the present position?

I think that the hon. Gentleman knows from my discussions with him that I share his anxiety that a modified procedure should be established quickly. On the latest information available to me, I can see no reason why that modified procedure should not be agreed this week.

Does the right hon. Gentleman accept that if his new strategy is based purely on the assumption of the markets likely to be gained, it will inevitably fail because the lead time between investing in the industry and getting coal out of the ground can be anywhere between five and 10 years? What we need is a strategy based not on so-called markets but on coal for the future. Energy policy can be based on that. Does the right hon. Gentleman think that we should be talking about tonnages in the year 2,000 and nothing else?

In the last strategy we had 10 years of investment, but, alas, not 10 years of improving productivity.

Are not the key determinants in any future strategy, first, that there should be flexibility and, secondly that there should be nothing written in tablets of stone which would prevent the NCB from doing what is in the interests of that great industry?

I have here a copy of the new coal strategy. It is a very poor description, and certainly not a policy. It is a strategy for contraction of the coal industry. Is the right hon. Gentleman aware that, if one examines the document further, one sees that the board doubts whether total coal production will be 90 million tonnes? Coal production could be below that level and, if it is, there will be more massive pit closures.

No one knows better than the hon. Gentleman that the only way for the coal industry to expand is to improve productivity. It would be nice to hear some original proposals from the NUM on how productivity can be increased.

5.

asked the Secretary of State for Energy what further information he has received from the National Coal Board regarding further pit closures.

9.

asked the Secretary of State for Energy if he will make a statement in the reduction of manpower in the coal industry since the end of the miners' strike; and how many further redundancies are planned for the next 12 months.

Individual pit closures and the future manpower requirements of the industry are matters for the NCB. I understand that, since the end of the strike, 16 pits have closed. The net reduction in numbers of men on colliery books from 9 March to 28 September was some 17,100. The level of future redundancies will depend upon the board's operational requirements and the numbers of men volunteering to go on the terms available.

Does the right hon. Gentleman accept that present and proposed pit closures are not in our long-term interests? Should not the Government's mandate to the NCB be to pay more attention to our long-term rather than short-term energy requirements and to stop pit closures in areas where there is workable coal?

I disagree with the hon. Gentleman. I think that the pit closures that have taken place are sensible. Our long-term requirement is energy at an economic cost for the benefit of our economy.

Will the right hon. Gentleman give the figures in the Scottish context? With respect to the answer to question No. 3, how many of those 2,500 jobs have been created in Scotland? The right hon. Gentleman should rest assured that for a long time a large number of Labour Members have regarded Mr. Scargill as the greatest disaster to befall the NUM since its inception.,

The hon. Gentleman will understand that I would have difficulty in disagreeing with the final part of his question. I do not have the breakdown of the Scottish figures, but I shall send them to him this evening. I recognise that there are some considerable problems for Scotland.

Successive Secretaries of State for Energy have closed pits, reduced manpower, and told us that productivity is being increased, so that in the end we would not have to put more thousands of millions of pounds into the coal mines. Could my right hon. Friend at least tell us when he thinks, as another Secretary of State, we should stop having to put thousands of millions of pounds down the coal mines and will get a real return for the taxpayer?

Investment in new machinery in better pits has been on a considerable scale, but, alas, there has been a lack of improvement in productivity. The current productivity figures for this year have been substantial, and I can only hope that that trend will increase. However, I cannot say what industrial or other action might take place to disrupt that progress.

As the Union of Democratic Mineworkers has clearly demonstrated that it is representative of a large group of people in the mining industry, will the Secretary of State give an undertaking that, if he discusses the future of the coal industry with various bodies, he will include the UDM if it wishes?

The coal board has recognised the UDM, so, in its discussions on matters such as the future of the coal strategy, presumably it will be included. I have always agreed to see the leaders of any trade union that is recognised.

Is it not the case that many pits were overmanned in the first place and that the output now, after some miners have left voluntarily, is not affected too much? Is it not interesting to note that many miners who have been prepared to take voluntary redundancy have been given a good deal by the National Coal Board, which should be supported?

It is certainly true that the problem of closures of uneconomic pits is being treated in a more civilised and generous way than it was ever treated by any Labour Government in our history.

The Secretary of State has not got his figures correct for Wales, in regard to what my hon. Friend the Member for Fife, Central (Mr. Hamilton) said, when he referred to Scargill and his predictions. In fact, the numbers of redundancies were underestimated by him if one considers the way that they have escalated in Wales. Is the Secretary of State aware that, despite an Adjournment debate and a series of questions, St. John's colliery in my constituency is now due for closure—not under the new review procedure that was promised to me by right hon. Gentleman's side-kick on the Front Bench —and that 800 miners are to be made redundant in an area where male unemployment is now 24 per cent. and will escalate to 50 per cent.? What action will the right hon. Gentleman take to deal with the unemployment problems in my constituency?

I can only suggest to the hon. Gentleman that, as many Opposition Members know, the coal hoard has made several offers under the modified procedure, which nobody could argue was other than in keeping with the proposals that have been made. If the unions disagree with the offer that is on the table, that will be extraordinary. I gather that if they agree, there is no reason why the closures, including that of St. John's, should not go ahead under that modified procedure.

The Secretary of State keeps referring to the modified review procedure. Is he aware that it is a year since the principles were agreed with the National Association of Colliery Overmen, Deputies and Shotfirers? Is it not obvious that the NCB has been deliberately delaying its implementation so that it can get on with closing pits? If the new scheme is agreed next week—we hope it is—will there be a review of all the pits that have been or are proposed to be closed, such as Horden in my constituency and Bates in Northumberland? Will they be subject to the review after the scheme is implemented next week?

With regard to the suggestions that have been made, some months ago there was agreement on the terms of reference on all the detail. The disagreement was on the composition. There was an offer of independent planning inspectors and independent lawyers, which was rejected, not by the coal board but by the other side. The agreement that is now available is an independent machinery, which is obvious to anybody. I hope that, not next week but this week, the unions will accept that offer. If they do, several closures that have been going through can be put through the modified procedures.

The right hon. Gentleman must remember that my right hon. Friend the Member for Salford, East (Mr. Orme) has previously raised the question of the new modified colliery procedure and drawn it to the attention of the right hon. Gentleman. The right hon. Gentleman uses the word "sacrosanct". Is he aware that a new situation has arisen? We find, without exception, that the National Union of Mineworkers, the British Association of Colliery Management and the National Association of Colliery Overmen, Deputies and Shotfirers take exception to the National Coal Board deciding unilaterally what kind of independent review proceedure there should be. Will the right hon. Gentleman intervene and tell the NCB that it is time it got back to the negotiating table and to the days when negotiations meant negotiations and not dictation?

I totally disagree with that interpretation. There have been a number of occasions on which any fair and reasonable person would agree that a totally independent procedure was on offer. I do not believe that there has been any delay on the part of the NCB.

Fluidised Bed Combustion

.6.

asked the Secretary of State for Energy what steps he is taking to promote the further development and use of fluidised bed combustion, in particular in regard to the development of combined heat and power systems.

My Department, the CEGB and the NCB are jointly funding a design study of an advanced 600 MW power plant employing pressurised fluidised bed combustion. The concept of linking a fluidised bed boiler to CHP plant is also being demonstrated under my right hon. Friend's Energy Efficiency Office's energy efficiency demonstration scheme.

Will the Minister make it clear that the Government agree that this sort of development would usefully and wisely demonstrate clean and efficient coal use, would provide very necessary industrial orders, and could, under the CHP system, provide considerable help to urban areas, which are currently in dire need? Even, if the NCB's present chairman is not enthusiastic about selling the coal that his industry produces, will the Minister accept that this venture could be extremely useful?

The technology for industrial boilers and furnaces is now fully commercial, with over 50 plants already built or on order. All variations of the technology, which the hon. Gentleman and I have seen, whether shallow, deep or circulating beds, are offered by British manufacturers with full commercial guarantees. It is very much the technology of the future.

Will the Minister stress that, in addition to fluidised bed combustion, there are many other ways of making coal efficient, other than by straightforward burning? Will he include such methods as gasification, which have an equal potential for industrial orders and for the future prosperity of the coal industry?

Yes, I agree. My hon. Friend made his point very well in his excellent speech last Friday.

As the coal-fired power stations will be coming towards the end of their life in the next 80 years, is the Minister proposing to order new coal-fired power stations, using the fluidised bed system?

As the fluidised bed combustion system is one of the methods by which sulphur emissions from power stations can be reduced, will my hon. Friend welcome such a development within CEGB power stations? In the light of the recent Select Committee report on acid rain, recommending that the United Kingdom should play its part in reducing trans-boundary pollution, will he set the CEGB targets for reducing sulphur and nitrogen oxide emissions from its power stations as part of a concerted Government policy?

I have already said and made it clear that this is a matter for the CEGB. I confirm, as I said to the hon. Member for Wentworth (Mr. Hardy), that this is exciting new technology, and considerable advances are already being made in a very positive way.

Energy Prices

8.

asked the Secretary of State for Energy what discussions he has had with the chairmen of the gas and electricity industries regarding energy prices in the next 12 months.

I have frequent meetings with the chairmen. Prices are a matter for the industries.

Are we going to find that the Secretary of State has yet again lost his battle with the Treasury over substantial fuel increases? Is he aware that increasing gas prices cause great hardship to many people, particularly those on low incomes who receive no assistance in paying their fuel bills? When will the Secretary of State recognise that these substantial increases are totally without justification?

The hon. Gentleman should realise that electricity prices have risen by only 6 per cent. over the past three years, whereas under the Labour Government whom he supported they went up by 6 per cent. every four months. If he fights the next election on gas and electricity prices, for the second time he will be defeated by the electorate.

Does my right hon. Friend agree that efficiency improvements in the gas and electricity industries should be passed on to the customer and to industry to maintain competitiveness with cheap energy countries? Will he, therefore, impress on his Cabinet colleagues that if they wish to increase taxation it should be done openly and not by artificially increasing prices?

That is why I am pleased that in real terms not only are gas prices at the same level as in 1970, but that in the last three years both gas and electricity prices have gone down in real terms. I rejoice in that fact.

Will the Secretary of State acknowledge that he and the Government have shown a bad example over the past few years to any potential private owners of British Gas as to how to exploit a monopoly? Will he acknowledge that with the privatisation of British Gas there is real tension, with the Government trying to maximise the price at the expense of consumer protection? Will he, as Secretary of State for Energy, assure the House that he is on the side of the consumer?

Of course. The record of the past three years shows that consumers of gas and electricity have done better than at any time since the war.

While I accept what my right hon. Friend said about the right of industries to agree prices, does he agree that any increase projected by either the gas or the electricity industry as a direct result of the miners' strike would be totally unacceptable to consumers?

There are many extra costs arising from the strike. The fact that certain price increases have not taken place during the period of that strike and since indicate that the Government share my hon. Friend's view.

May I jog the Secretary of State's memory? His predecessor introduced a formula of 10 per cent. above the rate of inflation for three years on the run for gas prices, leading to over 100 per cent. increase I understand that Sir Denis Rooke has said that there will be no need for increases in gas prices above the rate of inflation. Will the Secretary of State assure us that the Government are not proposing, or assuming that there will be, any bigger increases than this in future?

Perhaps the hon. Gentleman would care to ask, in the form of a written question, for publication of a list of price rises under a Labour Government as compared with this Government. The answer will show that their record vis à vis inflation or anything else is an appalling and disgusting one, of which the Labour party should be ashamed.

Electricity Supply Industry (Restructuring)

10.

asked the Secretary of State for Energy when he proposes to restructure the electricity supply industry and the area boards.

There are no present plans to reform the structure of the electricity supply industry.

I am very much obliged for that succinct answer. Will my hon. Friend consider over the long term, as the coal board supplies some 80 per cent. of its coal to the CEGB, the merger of these two industries under the electricity supply industry so that we can remove a certain number of anomalies? Will he also authorise, in the intermediate term, the CEGB to supply big projects with energy direct in order to reduce their costs?

My hon. Friend is an expert in these matters and raises some extremely interesting points, which I shall certainly consider.

Although he is not completely restructuring the system, will the Minister look at the total dissatisfaction among hon. Members arising from complaints from their constituents about the way in which their bills are handled? Is he aware that the consultative committee has become a bit of a farce? If he cannot totally restructure, will he do something, especially for the elderly, about the way in which area boards handle complaints about bills?

In my experience, the area boards and consultative committees handle complaints extremely effectively, but if the hon. Gentleman has any particular cases in mind I hope that he will draw them to my attention.

Energy Act 1983

11.

asked the Secretary of State for Energy if he will make a statement on the working of the Energy Act 1983.

It is too early to evaluate the full effects of the Act, but it is encouraging that the number of private generators selling electricity to boards in Great Britain rose from 59 in 1983–84 to 70 in 1984–85.

Will my right hon. Friend reconsider the fact that there is increasing evidence from private producers who claim that they are still not obtaining a fair price for their electricity and that the CEGB is not applying the spirit of section 19, which obliges the industry to adopt and support CHP and try to market its waste heat? Is he aware that the Sheffield consortium has been rejected by the CEGB even though the rate of return on its CHP scheme is in excess of the 5 per cent. discount rate required by nationalised industries and would be a higher rate of return than many other investments that the electricity industry is undertaking?

The Act provides a proper framework for fair trading. The figures that I have just announced show that there is considerable interest in the matter and that there is a reverse of the progressive decline that there was in private generation until the passing of the Act.

House Of Commons

Library (Usage)

28.

asked the Lord Privy Seal what has been the increase over the last 10 years in queries put by hon. Members to the Library.

Over the period 1975–84 the percentage increase in the number of Members' inquiries answered in writing by the research division and by the international affairs section of the House of Commons Library was 77 per cent.

Is the Minister aware that many Members of the House are grateful to the Library staff for the high quality of work and help that they give us, but that that is still no substitute for providing us with decent back-up? The two types of help are complementary. May I press the Leader of the House to think again about the need to provide each Member of the House who requires it with sufficient resources to employ one secretary and one research assistant?

The hon. Gentleman was shrewd to make the point about our gratitude to the Library staff, because that will unite the whole Chamber. I am not sure that the same is true of his second point. With the growth in the number of research assistants, one might have thought that there would be less demand upon the Library's research facilities, but in fact the reverse is true.

Following the comments of the hon. Member for Battersea (Mr. Dubs), when my right lion. Friend the Leader of the House reviews the opportunity for Members to have at least one research assistant, will he also consider limiting the number of research assistants that Members should have?

My hon. Friend raises two separate issues The hon. Member for Battersea (Mr. Dubs) was hoping that the review of the secretarial research allowance would proceed on the basis that the sum should include an amount equivalent to the financing of one full-time research assistant. The second point was made in the recent debate that we had on this matter. Whatever number of research assistants a Member might have, no more than two employees of a Member can have access to the House.

Notwithstanding the excellent help that the Library gives Members, how long will it be before the Leader of the House reviews the number of research assistants that hon. Members can have? Will he give an undertaking that that matter will receive priority over and above investigations into Members' salaries for this financial year?

Members' salaries for this financial year operate under an automatic formula. The subject of hon. Members' research assistants and the degree of access that they have has been remitted to the right hon. Member for Lewisham, Deptford (Mr. Silkin), and he will be reporting to the House in due course.

Is my right hon. Friend aware that the latest contacts that I have had with the Library have told me about the emergence of an interesting new species—the research assistant's secretary? Is he aware of the conundrum of big fleas, little fleas and lesser fleas? Does he not think that the amount of Ministers' and Library staff time taken up by these research assistants, their secretaries and their secretaries' research assistants, and the amount of paper used, and the photocopying, has got out of control?

I do not want to stray too far into that controversy, because the matter is now before the right hon. Member for Lewisham, Deptford. It is undoubtedly true that the term research assistant is used fairly liberally in our discussions. Many of those people could in no sense undertake serious research.

Proceedings (Sound Coverage)

31.

asked the Lord Seal if there are any plans to extend to Members' offices facilities for live sound coverage of the proceedings of the House.

I understand that the Select Committee on Sound Broadcasting is undertaking a study of the feasibility and cost of such facilities with a view to making recommendations to the Services Committee in due course, but the introduction of any such scheme would, of course, require the authority of the House.

Is my right hon. Friend aware that the Select Committee on Sound Broadcasting has already conducted a survey and that only 398 Members favoured such live sound coverage? In the interests of keeping the House active, will my right hon. Friend disregard that survey in view of the temptation for hon. Members not to turn up in the Chamber at all if everything is broadcast to their offices? Does my right hon. Friend agree that the Chamber is empty enough already?

My hon. Friend makes the very fair point that in this, as in so many other matters, we must have regard to the impact on attendance in the Chamber. I must point out to him, however, that as the matter is now before the Services Committee it would be inappropriate for me to make any observations or draw any conclusions until I have had the benefit of the Services Committee report.

I regret any disagreement with my hon. Friend the Member for Leicester, East (Mr. Bruinvels), but is my right hon. Friend aware that, although some of our parliamentary colleagues may be less than irresistible in their contributions, many of us who spend a fair part of the day at our desks might appreciate the opportunity to tune in from time to time to see how the proceedings are going?

That is an interesting view of the nature of the parliamentary process, but I must put it firmly on record that whatever we do we must do our utmost to maintain the vitality of this Chamber as the very heart of Parliament.

Opposition Parties (Funding)

32.

asked the Lord Privy Seal when he plans to review the funds granted to Opposition parties in Parliament.

The amounts payable to Opposition parties under the Short money scheme have so far been revised on four occasions since the scheme's inception in 1975. The latest rise was effective from 1 January 1985. 45too Following this pattern, a further review would be likely to take place in 1987 or 1988.

When the Leader of the House considers the matter again, will he bear in mind that the Short formula does not tell the whole story, because of the enormous range of exclusive fringe benefits granted to the Labour party as the official Opposition? Will he take into account the £80,000 in salaries for leaders of that party in both Houses, the £66,000 for civil servants seconded to them and the £30,000 for a car and chauffeur for the Leader of the official Opposition?

The hon. Gentleman is perfectly correct. The Ministers of the Crown Act 1937, under which a salary was first paid to the Leader of the Opposition, also provided for a number of supporting expenses to come from the public purse. The hon. Gentleman is, therefore, quite right. The evolution of the Short money system since then has meant that two systems have been operating in parallel. I agree that it is perfectly valid to consider that at some future date.

Will my right hon. Friend comment on the anomaly that whereas the Labour party apparently sees fit to accept public money to keep its democratic institutions working, a large proportion of the trade union movement apparently resists acceptance of such money to keep its democratic institutions working?

I would rather confine myself to what goes on in this Chamber. I believe that the provision in the 1937 Act allowing public funds to be made available to the Opposition party has proved itself. Perhaps in the fullness of time wiser counsels will also prevail in the trade union movement.

I hope that this will not be treated as a party matter— [Interruption.] It will not be too long before the Conservatives find themselves in opposition. We are talking about the workings of a healthy democracy. At present, the Short money is entirely inadequate for an Opposition to function properly. I was most disturbed to hear the right hon. Gentleman say that the matter will not be reconsided until about 1987. Does he agree that it should be done much sooner?

There are some who would argue that it is not the absence of money which makes for an ineffective Opposition. We should beware of being too liberal in the application of so-called Short money. An agreement has been concluded and it would be appropriate for it to run to 1987 or 1988, as I have suggested. Of course, these are all matters that are considered from time to time, so the hon. Gentleman should not get too excited about it.

Civil Service

Civil Servants (Royal Commission)

33.

asked the Minister for the Civil Service if he will study the proposals made by Sir Douglas Wass for the establishment of a Royal Commission to look at questions of civil servants' loyalty, ministerial involvement in appointments and public accountability of Whitehall officials and for the establishment of an independent inspector general to whom civil servants can appeal if they consider that Ministers are attempting to mislead Parliament, a copy of which has been sent to him.

I understand that the article to which the hon. Gentleman refers was written as a contribution to public discussion. I shall be interested to see comments upon it, but the Government have no plans for establishing a Royal Commission on these matters.

Did Ministers notice that, with the full argeement of my right hon. Friend the Member for Birmingham, Sparkbrook (Mr. Hattersley), my hon. Friend the Member for Bolsover (Mr. Skinner), speaking on behalf of the national executive committee of the Labour party at the Bournemouth conference, committed the party to the propositions encapsulated in the question? How can anybody resist my hon. Friend the Member for Bolsover when he is shoulder to shoulder with a former permanent secretary to the Treasury?

The hon. Gentleman will be astonished to discover that I find it quite easy to resist his proposal, and that of the hon. Member for Bolsover (Mr. Skinner). Procedures for the Civil Service are perfectly straightforward and well provided for. If civil servants have complaints, or if matters of conscience arise, there is a system of appeal that goes straight up to their permanent secretary if they wish. Such matters can ultimately be referred to the head of the Civil Service. The existing procedures are perfectly adequate.

As the Government have been commendably sefl-restrained in not establishing new Royal Commissions. and as it seems clear that, when he was in a senior position in the Civil Service, Sir Douglas Wass did not favour this proposal, will my hon. Friend follow his wise policy. study it, and reject it?

I assure my hon. Friend that there is no intention of forming a Royal Commission on this subject.

What is wrong with civil servants having a chance to appeal? Is the Minister aware that, in the past few months, there have been at least two instances of top civil servants taking non-executive directorships in private companies? They include civil servants in the Department of Trade and Industry. If it is right for civil servants, through the Government, to take on jobs in the private sector while holding down a top job in the Civil Service, surely to God it must be right for one on the other side of the fence to have a chance to appeal when he is being hammered by people such as Sir Robert Armstrong.

What is so extraordinary about all this is the assumption that there is no proper procedure for appeal if civil servants think that something has gone wrong. There is a perfectly legitimate procedure which was laid down clearly in a note by the head of the Home Civil Service, which he published at the end of February. It sets out quite plainly the procedure that any civil servant can follow if he has a problem that he wants to pursue.

Does not my hon. Friend think this question rather strange, coming from the hon. Member for Linlithgow (Mr. Dalyell), who was the very hon. Member who used his voice for Clive Ponting? Was it not he who tabled questions planted by Clive Ponting and which were to be answered by Clive Ponting, who then denied that he was the author? Is it possible that the hon. Member for Linlithgow is a hypocrite, disloyal, or has taken leave of his senses? [Interruption.]

I say to the hon. Member, who knows this perfectly well as he has been here long enough to know it, that that is not a parliamentary expression. I ask him please to withdraw that word.

I give the hon. Member one more chance. I would be very reluctant to take the matter any further. He knows very well that that was not a parliamentary expression and I ask him now to withdraw it.

Dispersal Policy

34.

asked the Minister for the Civil Service what is his policy towards the further disperal of Civil Service posts to the regions; and if he will make a statement.

There are at present no plans to extend the Government's dispersal programme beyond that announced on 26 July 1979.

The Government frequently shed crocodile tears about the high unemployment in the north. Why does the Minister not transfer some Civil Service posts to that region? Is the Minister aware that not a single Civil Service post has been transferred to the north since this Government came to power? As the decision is entirely that of the Government, would it not be a demonstration of concern for the north if they were to transfer some jobs there?

I know that the hon. Gentleman has strong views about this and has put down repeated questions on this important issue over the past few years. Our dispersal programme, which was announced in 1979, stands and has not yet been completed. The House will be aware that 4,500 civil servants have been dispersed since 1979 and another 1,400 have still to be dispersed. The northern region still has a higher proportion of civil servants than the national average.

Atkins: Is not of the decision of my right hon. Friend the Secretary of State for Defence to extend some of the activities of his Department an example that we ought to follow?

I agree with my hon. Friend, and I have considerable sympathy with what he said, because it comes within the existing policies of relocation of the Civil Service. Any Secretary of State considering the modernisation of his Department or offices can consider relocation in other areas. It is obviously up to the Secretary of State.

Is the Minister aware that the Government's decision when they came into office not to disperse the Property Services Agency to Middlesbrough was a devastating blow to Middlesbrough and to the whole of the Teesside area? In view of that devastating blow and the enormous vacant site in the centre of Middlesbrough which was cleared for that Government Department, and in view of the successful operation of defence establishments such as the Royal Navy spare parts depot in my own constituency at Eaglescliffe, will the Minister make representations to his right hon. Friend the Secretary of State for Defence, so as to get any Departments being dispersed into areas like mine?

I cannot contemplate a change in our dispersal policy. I remind the House that the previous question referred to the relocation policy which allows Departments, when they are modernising, to consider moving to other regions. That is an area that can be further explored.

Recruitment

35.

asked the Minister for the Civil Service what steps he is taking to encourage recruitment to the Civil Service.

Extensive efforts are made by the Civil Service Commission and Departments to encourage recruitment, through visits and other means of publicising employment opportunities in the Civil Service.

I thank my hon. Friend for that answer. Does he agree that the occasional publicity given to certain civil servants could mask the fact that on the whole this House and successive Governments are extremely well served? In their dealings with the Civil Service, have not this Government achieved something that successive Governments have been exhorting industry to do, which is to replace quality with quantity—sorry, quantity with quality?

I am grateful to my hon. Friend for his correction. I must agree with him that over the past six years the Civil Service has been through some necessary and dramatic changes, including a reduction of 133,000 civil servants, and great improvements in efficiency. We can now say with considerable pride that we have a service that is streamlined, modern, efficient and professional.

Does the Minister agree that a satisfactory outcome to the long-term pay negotiations that have just commenced between the Government and the Civil Service unions would greatly aid proper recruitment to the Civil Service? Will he make a statement on behalf of the Government and agree that the Civil Service unions should have access to arbitration and to pay research data, and that, in those negotiations, special account should be taken of the problems of the low-paid within the Civil Service as a whole?

I should stress that pay is a matter for my right hon. Friend the Chancellor of the Exchequer. Of course, facilities such as special allowances and special additions are available within the service to deal with recruitment and retention in areas where there are problems, such as shortages of specialist skills. On the broad question of longer-term pay, the proposals put forward by my right hon. Friend the Chancellor of the Exchequer on 15 October provide the prospect of a stable system of future pay negotiations which will be fair to employees, Government and taxpayers alike. Discussions are now proceeding on that matter.

Minister Of State, Home Office

3.30 pm

On a point of order, Mr. Speaker. Has the Leader of the House indicated to you that before the House is prorogued on Wednesday a statement will be made on the allegation made in this House last Thursday by the hon. and learned Member for Ribble Valley (Mr. Waddington) — the Minister of State, Home Office — that some hon. Members are abusing their right to make representations in cases? The hon. and learned Gentleman, referring to the system of making representations, went on to claim that "some hon. Members are abusing—I am not afraid to use that word — that system." — [Official Report, 24 October 1985; Vol. 84, c. 420.]

The allegations involve grave issues that touch on the honour and integrity of hon. Members, and it is incumbent on the Minister either to substantiate his allegations or to resign his office. You, Mr. Speaker, are the guardian of the honour and integrity of the House of Commons, and I put it to you that the House should not be prorogued until the matter has been cleared up.

Further to that point of order, Mr. Speaker. Are you aware that last Thursday, in answer to a question from me, the Minister implied that some Opposition Members were abusing their right to make representations? I am certain that he had me in mind because we have corresponded on this matter. I utterly refute any such suggestion. The Minister does not like the legal advice that I give my constituents, but it is absolutely within the law.

I sincerely ask you, Mr. Speaker, to make sure that time is made available for the hon. and learned Gentleman to be forced to name the people he has in mind, to give details of his allegations and to give us a chance to answer them.

It is similar, Mr. Speaker. Are you aware that outside this House many people are extremely concerned about the Minister's statement? Indeed, many migrant families are frightened of the implications. This goes with the Minister's curious decision last May to impose visa restrictions on people from Sri Lanka. He now appears to be trying to restrict further the rights of hon. Members by referring to individual Members of Parliament. Like my hon. Friend the Member for Birmingham, Ladywood (Ms. Short), I am quite sure that I am one of the hon. Members that the hon. and learned Gentleman had in mind because of the nature of my constituency and the fear among many migrant families. Therefore, Mr. Speaker, you ought to do your best to find a way in which this crucial matter can be debated before the House is prorogued on Wednesday.

Further to that point of order, Mr. Speaker. Many of us are being asked—I certainly am—whether we are the hon. Members about whom the Minister made that contemptuous reference. Unless the hon. and learned Gentleman comes before the House, we have no way of clearing our names. Many of us are, in good faith, giving advice to our constituents on the legal position, and if we are constrained from doing so because of what the Minister has said that puts us in a very difficult position. We have the right to ask you, Mr. Speaker, to ensure that there is an opportunity for us to clear our names.

Further to that point of order, Mr. Speaker. Perhaps I can be helpful by saying that the hon. Members concerned would clearly know who they were if they consulted their records. Many hon. Members are putting forward genuine visit applications to the Home Office and are saying, "I know this family", "It is a genuine visit", and so on. Why, then, are dozens of those families living at the same address?

Further to that point of order, Mr. Speaker. May I add my voice in a personal plea? I am the hon. Member with possibly more cases of this sort than any other. In fact, it has become quite a joke with the Minister's office, and I have been asked, "Which one is it this time, Mr. Pavitt?" We are therefore placed in an extremely unfortunate position unless we are able to go to our constituents and meet our community relations councils with a very clear statement that it is not us to whom the Minister is referring.

Further to that point of order, Mr. Speaker. If my hon. and learned Friend is to be asked to take the matter further, will he consider any cases which may have come to his attention of people who have approached one Member of Parliament and, when they have failed to get what they regarded as satisfaction, have subsequently gone to another Member of Parliament in whose constituency they are not involved so that they may get a more sympathetic and helpful hearing? Will he consider such cases before he comes to the House?

Further to that point of order, Mr. Speaker. Since I was the Member to whom the ill-judged observation was originally made—and since I do not want to be left out of the action—may I reiterate the demand that the Minister should come to the Dispatch Box and name names if he wishes to do so? Those of us with lots of immigration cases to handle —there are easier things to do—are entitled to defend our record in that we always work within the law.

Order. The House will understand that none of this is a matter for me. Every hon. Member and every Minister must take responsibility for his own statements, whether from the Back Benches or from the Front Benches.

I rise in the hope that what I say may be of assistance to you, Mr. Speaker, and to the House.

Immediately before coming to the House, I wrote to the right hon. Member for Manchester, Gorton (Mr. Kaufman) a long letter setting out the various abuses which have been occurring—and I note that a number of hon. Members are vying for the honour of being involved. I want to make it plain that I would not be cataloguing the abuses if I were not able to name names. I am by no means sure how I should proceed if the right hon. Gentleman wishes to press me on names. We are talking about correspondence between my private office and hon. Members which the writers never intended should be published. I am happy to discuss the matter with the right hon. Gentleman if he wishes to press further the request for names, but perhaps he and other hon. Members would like to read my summary of what has been occurring, and to consider how to proceed and whether it is necessary to raise the matter with you again.

Further to that point of order, Mr. Speaker. This is not a matter between the hon. and learned Gentleman and me; it is between the hon. and learned Gentleman and the House of Commons. When the hon. and learned Gentleman made his allegations last Thursday, he spoke about "some hon. Members". It is unacceptable to me, and were it acceptable to me it would not be acceptable to the House, that the matter should be settled by some kind of private fix between the Minister and me. The hon. and learned Gentleman has made allegations to the House about unnamed Members of Parliament.

I put it to you, Mr. Speaker, that it will not do for the hon. and learned Gentleman to say that he is faced with certain procedural problems. More than 96 hours have gone by since he made his allegations. It was on Friday morning on the radio that he said that he was ready, if asked in the House of Commons, to name names. A motion went down to that effect in the name of my right hon. Friend the Leader of the Opposition and other Opposition Members on Friday afternoon. If the hon. and learned Gentleman is now saying that he has not had time to deal with the procedural matters, all I can say is that he is trying to bottle out in some other way.

Therefore, I make it clear—and we ask for your assistance on this matter, Mr. Speaker—that whatever letter the hon. and learned Gentleman sends to me will not satisfy the House of Commons as a whole. It is to the House of Commons that the hon. and learned Gentleman ought to be made to answer between now and Prorogation.

Further to that point of order, Mr. Speaker. I am prepared to take advice. I should be happy to take advice from you, Mr. Speaker. There is no mystery about this. Of course I would not have been able to make the allegations, and I would not have dreamt of making any allegations, had I not been in a position to identify particular cases of abuse. I repeat what I said before: I am happy to take advice from anyone on this, but we should all think about what is the right way to proceed in a matter like this.

Further to that point of order, Mr. Speaker. Is it not clear that the hon. and learned Gentleman should have taken advice before he made those allegations? Is it not the duty of everyone in the House, especially you, Mr. Speaker, to ensure that we preserve the reputation of the House?

Is it not a serious matter when a Minister of the Crown makes statements alleging abuse of power by hon. Members? Should not the Minister be answerable to the House if the hon. Members are actually giving advice within the law laid down by the Government and carrying out their function of giving the best advice that they possibly can to their constituents on the basis of the existing law?

Would not the honourable and correct course for the hon. and learned Gentleman be for him at least to make a statement about what he thinks the offences and abuses are and to go further and name the hon. Members who he thinks are responsible and face questioning in the House?

Further to that point of order, Mr. Speaker. The Minister clearly made the implication that some of us might be embarrassed by the publication of letters that we had never thought would be published. The Minister has my total permission to publish any letter that I have written to him on any immigration case.

Further to that point of order, Mr. Speaker. May I have an assurance from you that it is right and proper for my hon. and learned Friend the Minister of State, Home Office to seek advice from hon. Members who have written letters in confidence to him about constituents before names are released? Surely my hon. and learned Friend is doing just that. I cannot see what the fuss is about.

Further to that point of order, Mr. Speaker. Is it not evident that the matter cannot be properly dealt with on a point of order? It is impossible on points of order to continue to put questions to the Minister, and many hon. Members in different parts of the House have every right to put questions. Surely the right way for us to proceed is to follow the request made by my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman). The Minister responsible should come to the House; and, in the light of the way in which the Minister of State has dealt with the matter, I suggest that the only proper course is for the Home Secretary to come to the House and make a statement on the matter.

That is a typically wise suggestion. I think that we should leave the matter there.

On a different point of order, Mr. Speaker. Against the background of circumstances of which you had knowledge this morning, may I put it to you that you may be at a disadvantage in not knowing that the last two RAF personnel defendants have been acquitted at the Old Bailey. Therefore, does it not behove either the Secretary of State for Defence or the Attorney-General to come to the House to explain the background of that £4·5 million, 119-day trial, which is a matter of considerable public concern?

I was not aware of that information, but the Leader of the House is present and I am sure that he will have heard what the hon. Gentleman said.

I will take one more point of order, but I think that the right hon. Member for Blaenau Gwent (Mr. Foot) has already made the wisest suggestion.

Yes, but this matter regarding hon. Members mentioning unnamed other hon. Members is a matter for you, Mr. Speaker. I should like you to take into account what has happened in the past.

When my hon. Friend the Member for Bassetlaw (Mr. Ashton) said outside the House several years ago that there were certain hon. Members for hire, he was taken before the Privileges Committee. That was a matter for you.

When my hon. Friend the Member for Sheffield, Attercliffe (Mr. Duffy) was the hon. Member for Colne Valley in the 1960s and said that certain hon. Members were drunk, he had to go before the Privileges Committee, because he was not prepared to name specific hon. Members.

On this occasion, not a Back Bencher, but a Minister of the Crown has said, in the same sort of context, exactly what my hon. Friend the Member for Bassetlaw said about some other hon. Members and without naming them. Therefore, I suggest that that is a matter for the Privileges Committee.

In both previous cases, the hon. Members concerned had to go before the Privileges Committee and finally withdraw their allegations. I suggest, Mr. Speaker, that, contrary to the advice that you have already been given, this is a matter for the Privileges Committee and the Minister should be sent before it to name the hon. Members or withdraw the allegations.

Order. I do not think the hon. Gentleman can know what advice I was given. If he is alleging a matter of privilege, he should write to me and put the case in the usual way. That is the rule, and he knows it.

Questions To Ministers

On a point of order, Mr. Speaker. My point of order involves both the procedures of the House and the Minister of State, Home Office.

On Monday 21 October, I submitted nine separate questions about visitors from Bangladesh for written priority answer. I submitted those questions to the Home Secretary, but on Thursday 24 October I received a reply from the Minister of State to all nine questions, which stated simply, "I shall reply as soon as possible". I make no complaint about that, because it is a familiar reply to questions before the information is available to Ministers.

However, the very next morning, on Friday 25 October, it was reported to me — and I have subsequently checked the tape—that the same Minister of State, in the BBC radio programme "Today", volunteered the precise information that I had requested in one of the nine questions to which I still await replies.

This raises questions about the Minister's conduct and the rights of Members on which I seek your guidance. Mr. Speaker. First, is it not plain that the Minister misled the House in his written reply? He clearly had the information for which he was asked and he clearly did not reply as soon as possible, as he said he would. Indeed, he has not yet replied to the questions put down by me seven days ago. If the Minister had been a visitor from Bangladesh and had answered questions in such a way at Heathrow, he would have been put on the next plane home.

Secondly, if a Minister is asked a question in the House, is it not an abuse for that Minister deliberately to withhold the information that he possesses?

Finally, is it not a gross discourtesy for the Minister to release to the BBC, and through it to the press, the same information that he withheld from a Member of the House and is it not in direct conflict with the advice that you have consistently given to Ministers?

What the right hon. Gentleman has said is not exactly a matter for me. It is a matter for the Government and for the Minister concerned, who is here.

Further to that point of order, Mr. Speaker. I certainly meant no discourtesy to the right hon. Gentleman. He will recall that he put down a large number of interlinked questions. I cannot remember whether it was tabled yesterday or whether it has been tabled now, but what was obviously required and what was considered to be most convenient to the right hon. Gentleman was to put down one answer to all those questions.

Further to that point of order, Mr. Speaker. I must make it perfectly plain that they were separate questions which deserve and should have separate replies. One of those replies was clearly available to the Minister of State when he refrained from giving it on Thursday afternoon.

Qe2 (Renovation Contract)

3.48 pm

I beg to ask leave to move the Adjournment of the House, under Standing Order No. 10, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,

"the announcement reported on Friday of the Cundard shipping company to award a contract for the re-engining and renovation of the QE2 to the West German shipyard Lloyd-Werft."
In view of the imminent Prorogation of the House, time should be found to debate this specific and important matter before Wednesday. The matter is specific in that the order, worth £80 million, will do further injury to the United Kingdom shipbuilding and marine engineering industry. That industry has experienced remorseless decline, which is intensified by the decisions of British shipping companies and other domestic maritime agencies to place orders with foreign yards.

During the 20 years since the QE2 was launched on the Clyde, we have lost more than 80,000 jobs in our shipbuilding and engineering industries. If the decline continues, we shall lose the merchant shipbuilding sector of the industry and the last remnant of the marine engineering industry.

The matter is urgent because we need to examine closely the reasons for the reluctance, or failure, of companies such as Cunard to place orders with United Kingdom yards.

Finally, the nine new engines which the QE2 is to have could be constructed in United Kingdom marine engineering plants, in Belfast, my constituency or on the Tyne. Indeed, it is conceivable that the whole operation could have been carried out on the lower reaches of the Clyde. Cunard did not ask a single United Kingdom marine engine builder to bid for the manufacture of the nine engines. That part of the order is worth £60 million.

The issue causes deep anxiety to the shipbuilding industries of Belfast, the Tyne, the Mersey and the Clyde. I hope that you, Mr. Speaker, will give sympathetic consideration to my request.

The hon. Member for Greenock and Port Glasgow, (Dr. Godman) asks leave to move the Adjournment of the House, under Standing Order No. 10, for the purpose of discussing a specific and important matter which he thinks should have urgent consideration, namely,

"the announcement reported on Friday of the Cunard shipping company to award a contract for the re-engining and renovation of the QE2 to the West German shipyard Lloyd-Werft."
I fully understand the importance of the matter to the hon. Gentleman and his constituents. I listened carefully to what he said, but I do not consider that the matter is appropriate for discussion under Standing Order No. 10 and, therefore, I cannot submit his application to the House

Immigration Control

3.52 pm

I beg to ask leave to move the Adjournment of the House, under Standing Order No. 10, for the purpose of discussing a specific and important matter that should have urgent consideration, namely, "immigration control."

Such a debate would allow the Government to give the House information on three important matters. First, it would enable the Government to confirm or deny reports that they are planning to introduce visa requirements for visitors coming to Britain from the New Commonwealth and Pakistan. Yesterday The Sunday Times reported:
"The Home Office is considering imposing visa requirements on visitors entering Britain from some Asian and black Commonwealth countries. The move is being canvassed in Whitehall as a means of clearing the immigration bottleneck at London's Heathrow airport.
Bangladesh is the country causing immigration officers most concern at present. It is widely felt that if visas are introduced for Bangladeshi visitors other Commonwealth countries in the Indian sub-continent and north Africa will follow."
Secondly, such a debate would allow the Government to explain to the House their action to resolve the crisis within the immigration service that is primarily caused by staff shortages, which the Government refuse to remedy. The Sunday Times referred to the crisis at Heathrow as being a reason why the Government are considering the introduction of visa requirements for visitors to Britain. The Guardian today confirms that the introduction of visas for visitors from Commonwealth countries was suggested in reports at the weekend. Last night a spokesman for the Home Office said that the matter was under consideration, and that was confirmed later by another spokesman for the Home Office.

Thirdly, the debate would give the Minister of State, —who I am glad to see has returned to the Chamber and taken his place on the Treasury Front Bench—an opportunity to substantiate or withdraw the serious allegations that he made in the House on Thursday. The evident concern that they caused has been reflected by the numerous points of order that have been raised this afternoon.

You, Mr. Speaker, showed sympathy with the suggestion of my right hon. Friend the Member for Bethnal Green and Stepney (Mr. Shore) that the Home Secretary should make a statement. An emergency debate would provide an excellent opportunity for the Home Secretary to tell the House whether the Government are planning to introduce visas for visitors coming from Bangladesh and shortly from other New Commonwealth countries and Pakistan. Such a debate would also provide an opportunity for the right hon. Gentleman to tell us what action is being taken to deal with the administrative crisis within the immigration service.

You will recall, Mr. Speaker, that many hon. Members, including yourself, were deeply concerned when the Government chose over the Whitsun Bank Holiday to introduce visas for visitors seeking to come here from Sri Lanka. You will remember also that many hon. Members were concerned by the introduction of entry clearance fees for all people seeking visas to come to Britain for settlement. The fees were slipped through by the Government during the Christmas recess.

I suspect, other hon. Members suspect and many individuals and organisations outside the House who represent the interests of ethnic minorities suspect that the Government are planning visas for Bangladesh visitors coming to Britain and that they will do so during the period which starts on Wednesday. when the House will not he sitting, and prior to the new Session.

To avoid any recriminations that will ensue if the Government act in that way, I suggest that the best course of action for the Government would be to reassure the House as to their intentions for the extension of visa requirements during a debate which obviously is for you to grant, Mr. Speaker. The Government would have an opportunity to provide a full explanation and to take up the serious allegations which were made by the Minister on Thursday. They would be able to tell us what action they are taking to deal with the immigration crisis at Heathrow and other ports of entry throughout the country.

The hon. Member for Bradford, West (Mr. Madden) asks leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he thinks should have urgent consideration, namely, "immigration control".

I have listened carefully to what the hon. Gentleman has said. As he knows, my sole duty in considering an application under Standing Order No. 10 is to decide whether it should be given priority over the business already set down for today or tomorrow. I regret that I cannot find that the matter which he has raised meets all the criteria that are laid down in the Standing Order and I cannot, therefore, submit his application to the House.

Orders Of The Day

Insolvency Bill

Lords amendments to certain Commons amendments and Lords consequential amendments considered.

The Lords have agreed to the amendment made by the Commons:

After clause 2, insert the following new clause—

Reference to Tribunal:

—(1) A person on whom a notice is served under section [Notices] (2) above may within twenty-eight days after the date of service give written notice to the relevant authority requiring the case to be referred to the Tribunal referred to in subsection (6) below.
(2) Where a requirement is made in accordance with subsection (1) above, then, unless the relevant authority within the period there mentioned—

(a) decides to grant the application or, as the case may be, decides not to withdraw the authorisation; and

(b) gives written notice of that fact to the person by whom the requirement was made,

it shall refer the case to the Tribunal.
(3) On a reference under this section the Tribunal shall—

(a) investigate the case; and

(b) make a report to the relevant authority stating what would in their opinion be the appropriate decision in the matter and the reasons for that opinion;

and it shall be the duty of the relevant authority to decide the matter accordingly.
(4) The Tribunal shall send a copy of the report to the applicant or, as the case may be, the holder of the authorisation; and the relevant authority shall serve him with a written notice of the decision made by it in accordance with the report.
(5) The relevant authority may, if it thinks fit, publish the report of the Tribunal.
(6) For the purposes of this section there shall be a tribunal—

(a) which shall be known as the Insolvency Practitioners Tribunal (in this Part referred to as "the Tribunal"); and

(b) in relation to which the provisions of the Schedule 1 to this Act shall apply.'

Lords amendment: No. 1, in line 2, leave out from beginning to "give" in line 4 and insert—

". —(1) Where a person is served with a notice under section (Notices) (2) above, he may—
  • (a) at any time within twenty-eight days after the date of the service of the notice; or
  • (b) at any time after the making by him of any representations in accordance with section (Right to make Representations) above, and before the end of the period of twenty-eight days after the date of the service on him of a notice by the relevant authority that the relevant authority does not propose to alter its decision in consequence of the representations,"
  • 3.57 pm

    I beg to move, That this House doth agree with the Lords in the said amendment.

    With this it will be convenient to take Lords amendments Nos. 2 to 5 and 74.

    Lords amendments Nos 1 to 5 inclusive give effect to an undertaking which was given to the right hon. Member for Glasgow, Govan (Mr. Millan) when the Bill was considered on Report. They provide that, where the relevant authority has given notice that it intends to refuse or revoke an authorisation to act as an insolvency practitioner and the person concerned within 14 days makes written representations to the relevant authority as to why it should not, the time limits on the period in which that person may require the case to be referred to the insolvency practitioners tribunal shall not begin to run until he has been made aware that his written representations have been rejected.

    Lords amendment No. 74 ensures that members of the tribunal are subject to equivalent parliamentary disqualification in Northern Ireland as in Great Britain.

    I welcome the Under-Secretary of State to the deliberations of this small and select group which has lived with the Bill for a long time. The group is becoming smaller and more select by the minute.

    The Under-Secretary of State arrives at a rather late stage. We have spent a great deal of time on this measure. It has been something of a marathon, and I think that we can offer the hon. and learned Gentleman nothing more than a gentle canter down the finishing straight. He arrives at a moment when he can perhaps make his own small contribution to what might well become an achievement to be recorded in the "Guinness Book of Records-. I believe that the number of amendments tabled to the Bill throughout its stages in both Houses is likely to exceed 1,200. The Under-Secretary of State will move even more amendments today and thereby add his name to that record-breaking achievement. I am not sure that the hon. and learned Gentleman would wish to be associated with that sort of achievement.

    Despite the scale of the deliberations and the amendments which have been tabled and passed, I believe that many hon. Members and people outside the House would regard the measure as still being seriously deficient. Although I would certainly claim that in many respects it is a better measure than when it first appeared, nevertheless I agree with those, such as the National Consumer Council, the CBI and the Institute of Directors, who have all characterised the Bill as a missed opportunity and one that on present form is unlikely to recur for perhaps another 100 years unless perhaps a Government of a different persuasion were to see the need to introduce further reforms.

    I thank the Under-Secretary of State for the way in which his officials have marshalled the material. It has been done in an extremely helpful and useful way, and I am sure that hon. Members would wish to express their appreciation to the hon. and learned Gentleman and his officials. We could well have wished that the matters that are being brought back to us from another place were of more substance and dealt with some of the remaining pressing concerns about the framework and shape of the Bill. Unfortunately, that is not the case. The matters with which we must deal this afternoon are essentially drafting and technical in almost every case, and so they will not detain us for long. I do not believe that this first group of amendments will detain us long either.

    I welcome the fact that the Government have met the undertaking that they gave to my right hon. Friend the Member for Glasgow, Govan (Mr. Millan). The Opposition are pleased with this group of amendments.

    I thank the hon. Member for Dagenham (Mr. Gould) for his welcome, which I very much appreciate, and for his kind remarks about the way in which departmental officials had marshalled the information. I am particularly pleased to see with us this afternoon my hon. Friend the Member for Edinburgh, Central (Mr. Fletcher) who is entitled to the credit for this legislation and who undertook the considerable work of piloting the Bill through the House.

    The hon. Member for Dagenham referred to the number of amendments that have been tabled. I suggest that they show more than anything else the Government's readiness to listen to the suggestions on how it could be improved that have been made during the passage of the Bill. The Bill has been improved.

    I entirely accept that the Government have listened to some effect. Many of us would make the point, however, that it is a pity that they did not listen a little earlier when they might well have published a draft Bill that could have avoided many of the difficulties that we subsequently encountered.

    I am sure that the hon. Gentleman would not like the door to shut on consultation at any stage. It is right, especially with a measure of this type, that consultation should be a continuing process. Of course it has not proved possible to satisfy everyone, but such a measure involves a delicate balance of interests and, inevitably, some people will be disappointed at the outcome. I commend the amendments to the House as striking the right balance.

    Question put and agreed to.

    Subsequent Lords amendments agreed to.

    The Lords have agreed to the amendment made by the Commons:

    After Clause 10 insert the following new clause:—

    Restriction on use of company names:

    '(1) This section applies to a person where a company ("the relevant company") has gone into insolvent liquidation and he was a director or shadow director of the company at any time in the period of twelve months ending with the day before it went into liquidation; and for the purposes of this section a name is a prohibited name in relation to such a person if—

  • (a) it is a name by which the relevant company was known at any time in the said period; or
  • (b) it is a name which is so similar to a name falling within paragraph (a) above as to suggest an association with the relevant company.
  • (2) Except with the leave of the court a person to whom this section applies shall not at any time in the period of five years beginning with the day on which the relevant company went into liquidation—

  • (a) be a director of any other company that is known by a prohibited name; or
  • (b) in any way, whether directly or indirectly, be concerned or take part in the promotion, formation or management of any such company; or
  • (c) in any way, whether directly or indirectly, be concerned or take part in the carrying on of a business carried on (otherwise than by a company) under a prohibited name.
  • (3) If a person acts in contravention of this section he shall, in respect of each offence, be liable—

  • (a) on summary conviction, to imprisonment for a term not exceeding six months or to a fine not exceeding the statutory maximum or to both;
  • (b) on conviction on indictment, to imprisonment for a term not exceeding two years or to a fine or to both.
  • (4) In subsection (2) above "the court" means any court having jurisdiction to wind up companies; and on an application for leave under that subsection, the Secretary of State or the official receiver may appear and call the attention of the court to any matters which seem to him to be relevant.

    (5) References in this section, in relation to any time, to a name by which a company is known are references to the name of the company at that time or to any name under which the company carries on business at that time.

    (6) For the purposes of this section a company goes into insolvent liquidation if it goes into liquidation at a time when its assets are insufficient for the payment of its debts and other liabilities and the expenses of the winding up.

    (7) In this section "company" includes a company which may be wound up under Part XXI of the 1985 Act.'

    Lords amendment:No. 6, line 13, after "court" insert

    "or in such circumstances as may be prescribed"

    I beg to move, That this House cloth agree with the Lords in the said amendment.

    The new clause was introduced into the Bill in this House but reservations were expressed by my hon. Friend. the Member for Richmond and Barnes (Mr. Hanley) and by practitioners that the provisions could adversely affect the sale of businesses or parts of businesses as going concerns by administrative receivers, administrators and liquidators. The amendment meets that criticism by allowing exemption from the provisions in certain circumstances, which will be prescribed in the rules. Such circumstances will be formulated following discussions in due course with practitioners but will concern sales by administrative receivers, administrators and liquidators who will be under a duty to obtain certain undertakings from the purchasers which will ensure that those subsequently dealing with the new company are adequately informed about the circumstances in which it is using the relevant name and are not misled. I commend the amendment to the House.

    I am content to accept the amendment. It goes some way towards meeting the proper concern expressed in Committee about the difficulties that the preexisting conditions might well have posed to administrators and others. I observe only that this is yet one further example of detailed provisions being siphoned off into the rules, which we have yet to see. I understand why that has been done on this occasion, but it has been a notable and perhaps unfortunate feature of the Bill that so much of what we need to know about the changes to be made to insolvency law has been left as a matter for regulation.

    I very much agree with the latter comments of the hon. Member for Dagenham, (Mr. Gould). I also warmly welcome my hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard) to the Front Bench; and I pay warm tribute to the previous Minister, my hon. Friend the Member for Edinburgh, Central (Mr. Fletcher). My hon. Friend the Member for Edinburgh, Central had just as much trouble as we did in trying to absorb the 450 amendments tabled in Standing Committee and the 250 amendments tabled on Report and he deserves as much credit as anyone for the exhaustive way in which we have dealt with the Bill. There is no doubt that he will have a willing place in any firm of insolvency practitioners, because there are probably few people who know as much as he does about the subject, although he did not know much to start with.

    I am grateful to my hon. and learned Friend the present Under-Secretary of State for what he has said about this amendment. Concern was expressed by practitioners that the requirement that court leave was to be obtained could inhibit sales of businesses by insolvency practitioners. After all, the name was often the only valuable asset which was left. Court leave would have not only inhibited the sale of the name but limited the money available for creditors.

    Practitoners welcome the amendment which provides that court leave will not be needed in circumstances to be prescribed. This at least opens the door and allows the name to be sold when it is considered safe. My hon. and learned Friend the Under-Secretary of State said that these circumstances would include sales by insolvency practitioners, provided certain undertakings were given by purchasers. The nature of these undertakings will require careful consideration. I hope that adequate time will be given for this and the very large number of other matters to be dealt with by the rules to be considered by practitioners. I beg my hon. and learned Friend to give practitioners sufficient time to consider these rules. Members of Parliament may be given two days' notice of many complicated amendments; practitioners need much more time. I suggest that there should be three or four months' discussion to ensure that the rules are workable when they eventually become law.

    I confirm that it is our intention to consult practitioners before we finally draw up the rules I would not wish to be held to a time limit, but it is our intention to give them every opportunity to comment and to consider the rules in their final form before they come into force.

    Question put and agreed to.

    Commons amendment: Insert new clause— Challenge of decisions

    '— (1) Subject to the provisions of this section, an application to the court may be made by any of the persons specified in subsection (2) below, on one or both of the following grounds, namely—
  • (a) that a composition or scheme approved at the meetings summoned under section (Summoning of meetings) above unfairly prejudices the interests of a creditor, member or contributory of the company;
  • (b) that there has been some material irregularity at or in relation to either of the meetings.
  • (2) The persons who shall be entitled to make an application under this section shall be—

  • (a) a person entitled, in accordance with the rules, to vote at either of the meetings;
  • (b) the nominee or any person who has replaced him under section (Report by nominee who is not liquidator or administrator) (3) or (Decisions of meetings) (2) above; and
  • (c) if the company is being wound up or an administration order is in force in relation to the company, the liquidator or administrator of the company.
  • (3) An application under this section shall not be made after the end of the period of twenty-eight days beginning with the first day on which each of the reports required by section (Decisions of meetings) (6) above has been made to the court.

    (4) Where on an application under this section the court is satisfied as to either of the grounds mentioned in subsection (1) above, it may do one or both of the following, namely—

  • (a) revoke or suspend the approvals given by the meetings or, in a case falling within subsection (1)(b) above, any approval given by the meeting in question;
  • (b) give a direction to any person for the summoning of further meetings to consider any revised proposal the person who made the original proposal may make or, in a case falling within subsection (1)(b) above, a further company or, as the case may be, creditors' meeting to reconsider the original proposal.
  • (5) Where at any time after giving a direction under subsection (4) (b) above for the summoning of meetings to consider a revised proposal the court is satisfied that the person who made the original proposal does not intend to submit a revised proposal, the court shall revoke the direction and revoke or suspend any approval given at the previous meetings.

    (6) In any case where the court, on an application made under this section with respect to any meeting, gives a direction under subsection (4) (b) above or revokes or suspends an approval under subsection (4) (a) or (5) above, the court may give such supplemental directions as it thinks fit and, in particular, directions with respect to things done since the meeting under any composition or scheme approved by the meetings.

    (7) Except in pursuance of the preceding provisions of this section, an approval given at a meeting summoned under section (Summoning of meetings) above shall not be invalidated by any irregularity at or in relation to the meeting.'

    Lords amendment: No. 7, in subsection (6), at end leave out "meetings" and insert "meeting".

    I beg to move, That this House doth agree with the Lords in the said amendment.

    This group of amendments relates to the voluntary arrangement procedure for companies. Amendments Nos. 8 and 9 will enable the court in appropriate cases at the time it makes a winding up order to appoint as liquidator of a company either the official receiver or a person who has previously been acting as the supervisor of a voluntary arrangement in relation to that company. Similar provisions were incorporated into the Bill at an earlier stage where bankruptcy follows an individual voluntary arrangement and where a compulsory liquidation follows the appointment of an administrator.

    Amendments Nos. 9A and 10A ensure that persons bound by a voluntary arrangement are given prompt notice when the supervisor considers his task is complete and also that they shall receive a full report on the administration of the scheme of composition. Such persons may of course challenge the acts of a supervisor before the court.

    When framing the rules which will flow from the enabling provisions, it is our intention not only to provide that notice supported by relevant information is given within 28 days of a supervisor completing his work, but for a penalty to be imposed for non-compliance.

    Amendment No. 11 repeals section 601 of the Companies Act 1985. That section, which provided a means of effecting a binding arrangement with creditors within a voluntary winding up, has been little used and is made redundant by the new more flexible company voluntary arrangement procedure now contained in chapter 1A of part II of the Bill. Consequential thereon is amendment No. 10 which substitutes reference to a corporate voluntary arrangement for reference to a binding arrangement under section 601 in relation to provisions governing the giving of financial assistance under section 153(3) of the principal Act.

    Amendment No. 7 corrects a drafting error.

    I commend acceptance of the amendments to the House.

    Question put and agreed to.

    Subsequent Lords amendments agreed to.

    Clause 15

    Effect Of Application

    Lords amendment: No. 12, in line 3, leave out from "or" to the end of line 5 and insert

    "continued and references to distress being levied shall be omitted."

    I beg to move, That this House doth agree with the Lords in the said amendment.

    Amendment No. 64 made by the House was intended to translate into Scottish legal terminology what is meant by the reference in clauses 15 and 16 to execution being "commenced or continued" and to "distress being levied". The translation, however, went further than intended and the proposed amendment to it, amendment No. 12, ensures that it has a similar effect in Scotland as in England and Wales.

    Amendments Nos. 13 to 17 are designed to meet concern on the part of insolvency practitioners that, after displacement by an administrator, receivers might still be held to be liable to pay preferential debts. Amendment No. 17 makes it clear that they are not liable once displaced, although they continue to be liable for their actions while in office.

    Amendments Nos. 18 and 19 both make further refinements to the Bill's provisions. The first of them enables the company or the directors, as well as a continuing administrator, a committee of creditors or creditors of the company, to apply to the court for an order to fill a vacancy in the office of administrator. The second, amendment No. 19, which was made in response to comments by those who have been consulted, brings administration into line with the winding-up code and receiverships which provide statutory sanction for the giving of directions by the court to compulsory liquidators, receivers and debenture holders.

    Amendment No. 72 introduced a new clause that entitled the administrator to exercise his powers, including his power of disposal, in relation to property covered by a debenture conveying a floating charge capable of leading to the appointment of an administrative receiver, property covered by any fixed charges held by the debenture holder and book debts covered by a charge. The clause preserved the security over such property by providing that any existing security should "follow" the proceeds of property disposed of as if the security, whatever its original nature, were a crystallised or attached floating charge.

    However, we have received strong representations from financial institutions and practitioners and the Government are persuaded that it would be unjust for fixed charges held by a person who also has a floating charge and those over book debts to be dealt with differently from those held by other fixed chargeholders. Amendment No. 20 therefore removes from subsection (1) property subject to fixed charges held by a floating chargeholder and fixed charges over book debts. The administrator must therefore apply to the court for authorisation to dispose of property subject to such charges. He will remain entitled to dispose of assets subject to floating charges.

    To remedy a defect in subsection (4), amendment No. 21 transfers the security holder's priority to any property representing, directly or indirectly, the charged property disposed of. Thus, for example, if the administrator sells charged plant and machinery, the chargeholder's security would attach to the moneys obtained from the sale and then to any asset that those moneys might be converted into.

    4.15 pm

    I make no apology for emphasising that amendment No. 20 effects a substantial change in the manner in which an administrator will conduct the business of the company. We have accepted the strong representations of financial institutions and insolvency practitioners that, in its unamended state, the clause puts the interests of the secured financial creditors at very great risk by enabling the administrator to use their secured assets for trading funds. They saw themselves as being compelled in effect to make "forced loans" to someone over whom they had no control. In such circumstances, where possible, they would always appoint an administrative receiver to obtain control of the secured assets even though that might destroy the company's chances of rehabilitation.

    The widespread adoption of that attitude would make the administration procedure unworkable and we sought by the amendment to meet the fears expressed. We accept in practice that the administrator will, in most cases, need to obtain finance for trading from a company's bankers, but we anticipate that the institutions, having supported or consented to the appointment of the administrator, will play an important role in the achievement of the purposes of the administration and provide on sensible terms the finance required. We trust that the changes in the procedure will improve its acceptability to the present structure of financing business in this country and provide a useful additional means of rehabilitating enterprises that would otherwise be destroyed.

    Finally, amendment No. 22 is a technical amendment which makes it clear that, in Scotland, where any hire purchase goods are disposed of by the administrator, the disposal has the effect of extinguishing any of the rights of the hire purchase owner in the goods. The hire purchase owner would, of course, still have rights to the net value of the goods by virtue of subsection (5) of the new clause inserted by amendment No. 72.

    Amendments Nos. 23 to 27 inclusive are all minor drafting and technical amendments.

    I am happy to give a general welcome to this group of amendments.

    I wish to say only one small word of commendation in respect of amendment No. 20. In the light of the representations that the Minister has received, he was right to move swiftly to make sure that the administration procedure, which I regard as one of the most constructive new features of the Bill, was not jeopardised. Given the hon. and learned Gentleman's explanation of the circumstances as they might have been affected by the Bill as drafted, when creditors with fixed charges might immediately have appointed an adminstrative receiver rather than allow an administration order to be made, the Minister's hon. Friends in another place were right to table the amendment and effect the change. It is important that the administration order procedure is given a fair wind.

    I believe that it would be wise to pay tribute to the many bodies that consulted the Minister and that the Minister consulted over the past few months during the summer recess. I am sure that the House will bear with me if I mention the names of the eight associations because they are important particularly in the development of the amendments that we are now discussing. The Department consulted the Institute of Chartered Accountants in England and Wales, the Institute of Chartered Accountants of Scotland, the Institute of Chartered Accountants in Ireland, the Association of Certified Accountants, the Insolvency Practitioners Association, the Law Society, the Law Society of Scotland and the Committee of London and Scottish Bankers, the latter having the greatest effect on amendment No. 20, which was mentioned by the hon. Member for Dagenham (Mr. Gould).

    It is vital that consultation takes place on technical matters of this sort. I echo the view of the hon. Member for Dagenham that if only a draft Bill had been put forward, many of the 1,000 amendments, in a 200-clause Bill— it is only a 200-clause Bill—would have been avoided. I know that it takes time to formulate a draft Bill, but it requires the confidence of the Government in the House to deal non-politically with matters of technical content. Therefore, if a draft Bill had been devised for the matter, many of the embarrassments over the past months might have been avoided.

    However, the consultation, albeit late, has taken place. I am grateful to my hon. and learned Friend the Minister for allowing changes before Lords amendments. The Lords have changed the Bill from what was very much a disappointing if not an impossible Bill to work into a Bill that has many good chances of surviving in future. It may survive with amendment in future, but we can give it a fair wind.

    With regard to amendment No. 20, in commenting on the provisions concerning administrators as they left this House, many practitioners noted that any banks which held fixed and floating charge security were not likely to allow the appointment of an administrator. It was a great shame, because the administrator is one of the great hopes for saving many businesses. This was because of the effect that they would have had on their fixed charge security, and who could have blamed them?

    The amendments made in the other place have brought major changes to administration orders. The administrator is not the animal that he was when he left this House, and I am grateful. His dominion is now only over floating charged assets. That allays the fears of the financial institutions but it leaves considerable uncertainty as to where an administrator's cash flow is to come from. Where there is a fixed charge on his fixed assets, that is one thing, but where there is a fixed charge on book debts, which is increasingly the case, one wonders where the administrator's funds will come from. Therefore, the practitioners in insolvency can give the amendment only a qualified welcome. The pendulum has swung too often over the procedure for us to know whether it is resting in exactly the right place.

    I thank the hon. Member for Dagenham (Mr. Gould) and my hon. Friend the Member for Richmond and Barnes (Mr. Hanley) for the welcome that they have given to the amendments. In particular, I associate myself and the Government with the tribute paid by my hon. Friend the Member for Richmond and Barnes to the various bodies which have participated in the extensive consultation that has taken place on the contents of the Bill in general and on these clauses in particular.

    Question put and agreed to.

    Lords amendments Nos. 13 to 27 agreed to.

    Clause 37

    Vacation Of Office

    Lords amendment: No. 28, in line 16, after "company" insert "without reasonable excuse".

    I beg to move, That this House doth agree with the Lords in the said amendment.

    With this it will be convenient to take Lords amendments Nos. 29 to 33 and 76.

    The amendments fall into two categories, those which deal with administrative receiver and receiver provisions in England and Wales —amendments Nos. 28 and 76—and those which refine the provisions for receivers in Scotland— amendments Nos. 29 to 33.

    Dealing first with the amendments relating to England and Wales, amendment No. 28 ensures that an administrative receiver will not commit an offence under clause 37(5) if he has a reasonable excuse for not sending the notice of his vacation of office to the registrar of companies, and is in line with other provisions of the Bill. Amendment No. 76 is a drafting amendment.

    With regard to the five amendments to the Scottish provisions, amendments Nos. 29 and 33 are both minor drafting amendments. Amendment No. 30 removes a contradictory qualification on the Scottish receiver's personal liability by removing the reference to section 473(1) of the Companies Act 1985 in section 473(2) of that Act. The consequential amendment No. 31 inserts the relevant words into the repeal schedule to the Bill. Amendment No. 32 makes a minor consequential amendment to section 477 of the Companies Act 1985 following the bringing of the receiver's powers to dispose of any interest in property subject to a security into line with those for England and Wales.

    There is nothing with which I disagree in this group of amendments. However, in the other place there was concern that the Bill did not make clear the position of practitioners with regard to contracts of employment after the 14-day period of grace in respect of adoption by omission had elapsed. In fact, it was I who mentioned the matter to the then Minister, and I was followed by my hon. Friend the Member for Tynemouth (Mr. Trotter), who very much regrets his absence today on parliamentary business.

    During the debate in the other place the Lord Advocate tried to put the minds of practitioners at rest by stating;
    "Where, for example, the contract is not discovered for a month after appointment, the court will not deem adoption to take place by that fact alone."
    With the greatest respect to the Lord Advocate, how can he say what the courts will or will not deem to be the case? It was my understanding—I may be wrong—that courts are not bound by the intention of Ministers in describing legislation. Therefore, if it is the intention that the legislation should not catch such circumstances, surely the amendment should have said so, and the Bill itself should he clearer, rather than hoping what judges might or might not take as being the proper interpretation of the clause.

    My hon. Friend is correct when he says that the courts are not bound by the intentions or, indeed, the observations of Ministers. Nevertheless, in assessing the likely effect and impact of legislation, Ministers are entitled to give the House guidance. The guidance given by the Lord Advocate was guidance given on the basis of my right hon. and learned Friend's experience and expertise in the branch of the law that is relevant to a consideration of the likely effect of the clause to which my hon. Friend has referred. He was not giving any guarantee as to the way in which the clause would be interpreted by the courts; he was giving another place the benefit of his experience and expertise. It was on that basis that another place was content with the clause as drafted, and it is on that basis that I commend it to my hon. Friend and to the House.

    Question put and agreed to.

    Lords amendments Nos. 29 to 33 agreed to.

    Clause 68

    Meeting Of Creditors In Creditors' Voluntary Winding-Up

    Lords amendment: No. 34, in line 9, leave out "two business days stated in the notice and falling" and insert

    "the two business days falling next".

    I beg to move, That this House doth agree with the Lords in the said amendment.

    With this it will be convenient to take Lords amendments Nos. 41 to 48, 70 to 73, 75, and 77 to 79.

    Amendment No. 34 is the first of a group of amendments consisting of drafting and technical amendments relating to winding-up, bankruptcy and miscellaneous matters. They either improve upon and give greater clarity to the Bill or merely involve the reenactment of current provisions in insolvency legislation.

    The amendments fall into four categories: provisions which deal with winding-up—amendments Nos. 34, 75 and 77; definitions—amendments Nos. 41, 43 and 44; bankruptcy—amendments Nos. 42, 45, 46, 47, 48 and 79; and miscellaneous clauses—amendments Nos. 71. 72, 73 and 78.

    Should the House so desire, I am in a position to expand on any individual amendment. Failing that, I do not intend to take up time in going into detail on those matters, and commend the amendments to the House.

    With regard. to amendment No. 77, the Commons amendment No. 458 introduced a new subsection (1A) to section 518 of the Companies Act 1985 by which a company is also deemed unable to pay its debts if the value of its assets is less than its liabilities, taking into account its contingent and prospective liabilities. Practitioners have commented that the amendment introduced a balance sheet test to accompany the existing cash flow test, with which we all agree.

    In the debate in the other place the Minister stated that the Commons amendment does not change the law but only gives effect to the way in which the courts have interpreted section 518 of the Companies Act 1985. In support of that contention, the Minister quoted Mr. Justice Nourse in Re: Bond Jewellers, when he said:
    "what I am required to do is to take into account the contingent and prospective liabilities. That cannot mean that I must simply add them up and strike a balance against assets."
    It remains the fear of insolvency practitioners that that is precisely what the new subsection (1A) of section 518 will require the courts to do. It is alarming that such a fundamental matter should remain a matter of such uncertainty at this stage. May I invite my hon. and learned Friend to seek further counsel on this matter? It is fundamental to the definition of insolvency to know exactly what assets are meant to cover what liabilities

    As I understand it, the point made by my hon. Friend relates to an amendment that was considered in the other place but not to an amendment made by another place in relation to the business before the House this afternoon. It does not, therefore, arise for consideration this afternoon and, in any event, I would not wish to add anything to the words of the learned judge cited both in another place and by my hon. Friend.

    Question put and agreed to.

    Clause 84

    Transactions At An Undervalue And Preferences (England And Wales)

    Lords amendment: No. 35, in line 5, leave out "in the ordinary course of and insert "for the purpose of carrying on''.

    4.30 pm

    I beg to move, That this House doth agree with the Lords in the said amendment.

    With this it will be convenient to take Lords amendments Nos. 36 and 57 to 59.

    These amendments modify the provisions of the Bill relating to preferences given to creditors and transactions carried out at an undervalue, both in winding up and in bankruptcy.

    Amendment No. 35 has been made as a result of representations received from the Law Society. The expression
    "in the ordinary course of '
    in relation to a company's business has been replaced by the expression
    "for the purpose of carrying on",
    so that it is clear that one-off transactions in genuine special circumstances—for example, rescue operations — are not automatically caught by the undervalue transaction provisions.

    Amendments Nos. 36 and 59, which have been made following representations from both the Law Society and the practitioners, ensure that employees of a bankrupt or insolvent company are not regarded as connected persons or associates for the purposes of preferences and undervalue transactions. Here we have in mind instances where persons are connected solely because of their employment. Those who are also directors or officers of a company will still be treated as connected persons.

    It was not intended that the normal receipt by employees of wages and related benefits should be subject to undue scrutiny. These amendments provide that, in relation to someone who is an employee only, transactions with him will be reviewable, as they are under the present law, for a six-month rather than a two-year period. There will be no presumption that a payment to such persons is a preference and, as regards transactions at an undervalue, they will not be required to demonstrate, in order to validate the transactions, that the company or individual was insolvent.

    Amendments Nos. 57 and 58 insert necessary drafting changes consequential upon Commons amendment No. 333.

    I commend the amendments to the House.

    Despite my best efforts and arguments, the Government and the Minister resolutely refused to accept amendments that I tabled in Committee which would have given effect to and recognised the special interest that employees have in the continuing viability of a company, particularly under the administration order procedure. I am glad to see that in this tiny respect, in the ground covered by amendments Nos. 36 and 59, there is some recognition of the special position of employees. I welcome those amendments, but I would prefer to have seen some concession on the more substantial ground.

    Question put and agreed to.

    Lords amendment No. 36 agreed to.

    Clause 87

    Avoidance Of Certain Floating Charges

    Lords amendment:No. 37, in page 70, line 2, after "charge" insert —

    "(aa) the value of so much of that consideration as consists of the discharge or reduction, at the same time as, or after, the creation of the charge, of any debt of the company;"