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Commons Chamber

Volume 128: debated on Tuesday 1 March 1988

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House Of Commons

Tuesday 1 March 1988

The House met at half-past Two o'clock

Prayers

[MR. SPEAKER in the Chair]

Oral Answers To Questions

Employment

Labour Statistics

1.

To ask the Secretary of State for Employment how many people in Southwark and Bermondsey have been unemployed for longer than a year; and if he will make a statement.

On 14 January 1988 the number of unemployed claimants in the Southwark and Bermondsey constituency who had been unemployed for more than one year was 3,048. That was 285 fewer than in January last year.

Is the Minister aware that although unemployment has fallen a little since last year it is up by one third since 1983? Forty-six per cent. of those who are unemployed have been out of work for more than a year. What hope is there for people in constituencies such as mine that the inner-city initiatives will produce help for local residents and not for so many of the commuters who come in from onside inner-city areas?

I understand the hon. Gentleman's concern, but I cannot help feeling that he is putting too gloomy a gloss on the matter. Unemployment has fallen by 12·9 per cent. in Southwark and Bermondsey during the past year. The travel-to-work area that includes the constituency has a lower rate of unemployment than the national average. If one considers the work done by the London Docklands Development Corporation, there is every reason to suppose that the jobs that are being attracted to the area and preserved and created there are certainly not all going to visitors. There is every reason to suppose that they are benefiting local people.

I am reassured by what my hon. Friend has said about the Southwark and Bermondsey constituency. Can he confirm that these promising signs prevail in the Southwark borough as a whole, and, in particular, in my constituency of Dulwich?

Whatever signs one looks at in the area, the position is hopeful. Job clubs in Southwark have helped about 225 people into jobs, the equivalent of 3,520 in Greater London. The YTS in Southwark is currently helping 555 people. The whole pattern is clear: the benefit that the whole country is enjoying is reflected in areas such as the constituencies of the hon. Member for Southwark and Bermondsey (Mr. Hughes) and of my hon. Friend the Member for Dulwich (Mr. Bowden).

Companies (Tourists' Visits)

2.

To ask the Secretary of State for Employment what plans he has to encourage industrial companies to open their premises to tourists; and if he will make a statement.

I shall continue to take every opportunity to promote the potential benefits to be gained from industrial tourism and am particularly pleased at the support expressed by Sir David Nickson, the president of the CBI, at my recent meeting with him. I welcome his proposal for a conference to be arranged by the CBI on this topic in September this year.

Everyone likes to watch other people at work. Who has not stopped to watch the activity on a building site or visited a local craft factory, such as a pottery or glassworks? Will my hon. Friend use his considerable influence to open up more mainstream industrial processes — for instance, car and furniture manufacturing—to industrial tourism? Who knows — that might even help us to sell a few more British goods.

As one who voted for the televising of the House, I believe that people do want to watch other people at work. In more serious vein, there is considerable potential for opening up more of our industrial factories to tourists. I want to encourage firms to progress from open days, or allowing only limited parties to go around, to embracing the concept of visitors and constructing walkways and viewing points, with proper visitors' entrances and access.

Will the Minister take a personal interest in the project being proposed by Jennings Breweries in Cockermouth in my constituency? It wants to turn part of the brewery into a sort of museum, but there appears to be some resistance from the councillors on the parish council. Will the Minister put it to them that Jennings' proposals are in the interests of the people of Cockermouth, and will he intervene?

I spend a great deal of time up in the Lake District and in areas covered by the Cumbria tourist board. In the next two or three weeks I hope to visit the Cumberland Pencil Company in Keswick. I shall certainly take on board the hon. Gentleman's points about Jennings and look into the matter. In due course, I may be able to visit the brewery, too.

Will my hon. Friend have a word with our right hon. Friend the Secretary of State for Energy to ensure that nuclear and coal-burning power stations have facilities for visitors and viewing galleries? Does he agree that as the sites are often on coasts and estuaries, they may become significant tourist attractions during a typical English summer?

My hon. Friend is right. He has opened up a new range of tourism opportunities for the electrical industry and coal mines. I should like to place on record the great success that British Nuclear Fuels has achieved at Sellafield, which receives 100,000 visitors a year.

Labour Statistics

3.

To ask the Secetary of State for Employment what has been the percentage increase in unemployment since May 1979.

15.

To ask the Secretary of State for Employment if he will make a statement on the level of unemployment.

Between May 1979 and January 1988 the seasonally adjusted level of adult unemployment increased by 122 per cent. on a consistent basis. The figure has now fallen by 647,000 since July 1986—which is the largest sustained fall on record — to 2,563,100, which is the lowest figure since April 1982.

Is the Minister not ashamed to come to the Dispatch Box to give those figures? Why is his boss, the Secretary of State for unemployment, swanning around the United States of America? No doubt he is cooking up some workfare scheme for the unemployed instead of coming to the Dispatch Box to tell us how the Government will create real jobs for unemployed people and get unemployment down to the level that they inherited from the last Labour Government.

My right hon. Friend is in the United States to promote the "Invest in Britain" campaign, which will help with jobs for this country. I am proud of the fact that unemployment has been going down strongly for the past 18 months in all regions, particularly in the hon. Gentleman's constituency in Falkirk, where it has been decreasing faster than the national average.

As the spectre of unemployment recedes, presumably to the political disappointment of many Labour Members, does my hon. Friend agree that one of the major challenges with which industry and the Government are faced is skill shortages? Can he offer some hope that this matter will be dealt with?

Yes, I can. However, when employers talk to me about skill shortages I always ask them how many people they are training. It is surprising how few have made the connection. We now have the new training programme that was announced by my right hon. Friend the other day, which will help considerably in this regard.

Has the Minister noticed the statement that was issued yesterday by the Society of British Aerospace Companies Ltd. It challenges the Government's assertion that 2·3 per cent. of gross domestic product is spent on research and development. Its calculations show that only 1·9 per cent. is spent, which is considerably below the amount spent by our nearest competitors. Is not that failure to invest in research and development reflected in the increased levels of unemployment from which we have suffered since 1979?

My Department does not deal with these figures, and I have not studied the report that the hon. Gentleman mentioned. I was talking about investment in skills, which is important, and which we are keen to encourage.

Is my hon. Friend aware that some parts of the country that have been associated with traditional manufacturing industry and high levels of unemployment have experienced some of the most spectacular falls in unemployment? Will he pay tribute to the spirit of enterprise that has been shown in my constituency of Bury, North, where the level of unemployment is down to 7 per cent.? Will he pay tribute to the hard-working staff of the job centres in Bury and Ramsbottom, whose efforts have contributed to that fall?

Yes, the staff in jobcentres in my hon. Friend's constituency and elsewhere have played a large part in the success. It is also a very good thing that over the year unemployment has been falling fastest in the west midlands, Wales, the north-west and the north, which are the most difficult regions.

Is the Minister aware that the Government's own "Labour Force Survey", just published, shows that in the year to mid-1987 the number of new jobs created was just 31,000, while the Government claim that over the same priod unemployment was cut by 221,000? Does that not prove that the Government's much vaunted big cut in unemployment is largely bogus and has much more to do with deterrent restart interviews and tighter availability for work rules than with any genuine creation of new jobs?

On the contrary, we have been creating new jobs very rapidly in recent years. The hon. Gentleman will see that if he compares our figures with those for overseas. Since June 1983 more new jobs have been created in this country than in the whole of the rest of the European Community put together.

Tourism

4.

To ask the Secretary of State for Employment if he will make a statement on the number of tourists visiting the United Kingdom in 1987.

By November 1987 the tourism industry in the United Kingdom had achieved a record, with 14·9 million visitors to the country. This figure is a 9 per cent. increase on the equivalent period in the previous record year of 1985. The total for the whole of 1987 will be released tomorrow.

I thank my hon. Friend for that excellent news. Can he estimate what contribution tourism made to the economy in 1987 and how our record compares with that of other Western nations? What is my hon. Friend's Department doing to help the English tourist board to move the many tourists who arrive in London to the regions? In my experience, Americans who come to south Dorset from London do not want to go back because of the wonderful welcome that they receive in places such as Weymouth and Swanage.

Let me take the latter part of my hon. Friend's question first. The English tourist board is working hard with the regional tourist boards to encourage American visitors to move into the regions rather than stay in London, Edinburgh and Stratford.

My hon. Friend asked about the contribution that tourism makes to the economy. There are a number of factors to be considered. The industry sustains 1·4 million jobs and the figure is growing at the rate of nearly 1,000 a week. We calculate that tourism now generates around £1·5 billion worth of new construction. In terms of overseas visitor tourist earnings, tourism is about 25 per cent. more important than aerospace, and four times more important than motor vehicles. Finally, my hon. Friend asked about other Western countries. We are fifth in the dollar earnings league in tourism, behind the United States, Spain, Italy and France.

Is the Minister aware that as tourism grows the number of official bodies proliferates and the arrangements could probably benefit from rationalisation? Is he also aware that some of the current problems arise from Government policy? For example, how are tourists to explore those delightful but remote villages in south Humberside and north Humberside when there are no longer rural bus services because of Government policies?

The hon. Gentleman knows that his specific question is for another Department. On his earlier point, while there may be a proliferation of tourism bodies in certain areas, a welcome feature of recent years has been the increasing partnership in the industry between the public sector — the regional tourist boards—and the private sector.

On the question about transport, we are blessed with a pretty good motorway network which helps the regions, particularly the north, the north-west, Yorkshire and Humberside.

Labour Statistics

5.

To ask the Secretary of State for Employment if he will make a statement on the number of job vacancies registered with jobcentres in the east midlands.

On 6 January 1988 the number of unfilled vacancies, excluding community programme, registered at jobcentres in the east midlands region was 11,300. This was an increase of 18·1 per cent. on the figure for January 1987.

I am grateful to my hon. Friend for that answer, which is very encouraging. It shows up some of the protestations from the Opposition, especially bearing in mind that there are fewer than 20 Labour Back Benchers in the Chamber for employment questions.

Does my hon. Friend agree that one of the important aspects of creating jobs is the creation of employment opportunities within areas? Is he aware that Derbyshire county council levies the highest shire county rate, and does he agree that that is a great disincentive to the creation of jobs in the county?

My hon. Friend is entirely right. The fact that the figures can look so promising in spite of that is a tribute to the efforts of the people who live there. It is a pity that the county council does not seem to devote as much time to considering the implications of a high rate for job prospects as it does to other activities, such as removing the Latin mottoes from local schools and replacing them with propositions relating to nuclear-free zones.

Is the Minister aware that Derbyshire county council would have been able to do much more if, in the last financial year, the Government had not taken £20 million from it, thus creating difficulties for every ratepayer in Derbyshire?

While the Minister is on the subject of jobs in the east midlands, will he tell us why, when I was asking questions a few years ago about the massive unemployment in the area, he said that it was not the Government's fault? It is not the Government's fault when the unemployment figures are going up, but when they come down —marginally—the Minister claims the credit.

The hon. Gentleman asks me, by implication, to comment on unemployment in the east midlands, and I am happy to do so. East midlands unemployment was down by over 35,000 in the last year. That is a rate of 8·3 per cent., and compares favourably with the United Kingdom rate of 9·2 per cent., adjusted. On the other hand, I appreciate that if Derbyshire county council cannot understand the virtues of living within one's means, it is highly unlikely that the hon. Gentleman will understand them either.

Employment Opportunities (Lancashire)

6.

To ask the Secretary of State for Employment if he will make a statement on employment opportunities in Lancashire.

On 8 January the number of unfilled vacancies registered at jobcentres in Lancashire was 5,716. This compares with 4,790 in January 1987. Only about one third of all vacancies nationally are notified to jobcentres. In the same period, unemployment in Lancashire has fallen from 79,344 to 65,623. All my Department's employment, training and enterprise measures are available in Lancashire.

I am encouraged by my hon. Friend's answer, as it bears out the fact that in my constituency of Fylde unemployment has dropped to about 7·5 per cent. Already, however, employers are experiencing shortages in both semi-skilled and highly skilled jobs. Can my hon. Friend tell me which items in his new training package he feels will contribute to addressing the problem? Does he feel that the voluntary sector has a role to play in that work as well?

I am sure that my hon. Friend is right to suggest that the voluntary sector has a role to play. Certainly, employers in the Fylde area report particular skill shortages in administration, legal secretaries, computer staff and so on. The new adult training programme will be very much locally conceived and locally delivered, precisely so that it can take account of particular skill shortages and requirements in particular areas.

Does the Minister honestly believe that employment prospects in Lancashire and the north of England generally can be as good as they are in the southeast, unless the Government are prepared to take proper steps? For instance, a development agency for the northwest would ensure that we received the investment that is needed to achieve decent quality employment in the areas.

The short answer is yes. As my hon. Friend the Minister of State has already said today, the rate of unemployment is falling, not only in the more prosperous regions, but throughout all the regions. If the hon. Gentleman wishes to examine any of the indicators for the areas about which he is concerned, he will find that that good news continues. For instance, unemployment in Lancashire has fallen from 14·8 to 12·2 per cent. Although we may wish that it had fallen still further, the point is that in the present economic environment it is clear that all regions not simply the more prosperous areas will benefit from falls in unemployment.

Tourist Priority Sites

7.

To ask the Secretary of State for the Employment if he will create a list of tourist priority sites for the encouragement of investment therein.

The Government have no plans to create a list of tourist priority investment sites. However, in its development strategy, "Vision for England", the English tourist board has highlighted the many opportunities that exist for investment in a wide range of tourism developments.

Although politics is about priorities, and "unique" is perhaps the most overworked word in the English language, does my hon. Friend agree that the Settle to Carlisle railway line is a unique priority for salvation as we approach the moment of decision?

Yes. It is a good word and perhaps my hon. Friend should learn it.

As the Department of Transport—I recognise that it has immediate ministerial responsibility for the decision—struggles to find a solution to the problem, will my hon. Friend recognise, not only that the River Ribble rises in the constituency of my right hon. and learned Friend the Patronage Secretary and that he has an interest in all this, but that my hon. Friend, as the Minister responsible for tourism, should do everything that he can to ensure that the line is not closed? Therefore, will my hon. Friend assure me today that he will speak to Department of Transport Ministers urgently to ensure that the tourism opportunities of the line are considered as part of the case against its closure?

I am aware of my hon. Friend's enthusiasm for both railways and tourism, and I understand his passion and conviction for the Settle to Carlisle line. I should emphasise that, as my hon. Friend has already said, this is primarily a matter for my right hon. Friend the Secretary of State for Transport. However, I assure my hon. Friend and the House that I have certainly ensured that the tourism considerations are taken into account. Indeed, I know the River Ribble well and I fish its headwater whenever I get the opportunity.

Will the Minister ensure that the Jarvis plc—MSC report on the Settle to Carlisle line corridor is brought to the attention of the Department of Transport? That report represents an important initiative by the Minister's Department regarding that line and its retention. Some of us suspect that the Department of Transport is planning to close the line. While the Minister is about that, could he look at the basis of this question—investment in tourist projects? He has spoken a great deal about job creation and so on, but why does the Department not put its money where its mouth is, for example, in projects such as the transport museum and associated tramway in my constituency at Low Moor in Bradford?

I believe I am correct in saying that the Department of Employment has funded, via the MSC, the Jarvis report to which the hon. Gentleman referred. As I said in answer to an earlier written question, that report will be published shortly. The hon. Gentleman should rest assured that the tourist implications have been and will be taken into account.

Is my hon. Friend aware that a trip over the Ribblehead viaduct on the Settle-Carlisle line, perhaps in a Pullman train pulled by one of our great historic steam locomotives such as a Great Western King or an LMS Duchess, blasting its way up to Aisgill summit is one of the world's greatest international tourist attractions? In comparison to that experience a trip even to Venice on the Orient Express is as a mere trip on Brighton pier. Will my hon. Friend both sample and save the Settle-Carlisle route?

I hear what my right hon. Friend says. Of course, all of us would like to see trains continuing to run across the viaduct, but, as a fisherman, I hope that they are not too heavy and do not disturb the fishing too much.

Will the Minister join me in welcoming the fact that Carlisle city council and the Cumbria county council are continuing to finance the Carlisle-Settle line despite the fact that the county council is threatened with rate-capping? Does the Minister agree that the closure of the line would have a detrimental effect on the efforts made by Carlisle city council to promote tourism? Will the Minister, once more, speak to the Secretary of State for Transport and make those facts known to him?

All I would say at this stage is that I am aware that my hon. Friend the Minister of State, Department of Transport, is having discussions with a number of authorities, including, I believe, Carlisle.

Is my hon. Friend aware that, certainly within the heart of England, there is plenty of scope for tourist development? Will he have a word with some of his colleagues in other Departments to ensure that the integrity of those areas is maintained, so that Britain remains as we know it today?

I certainly agree with my hon. Friend's sentiments. Only last night I was in Malvern, in the Heart of England tourist board area, and tomorrow I hope to be in the Forest of Dean.

Is the Minister aware that tomorrow's official tourism figures will show the biggest annual trade deficit in tourism for Britain for three decades? Is he aware that the Government's policy of high interest rates has sapped tourism as destructively as it has sapped our manufacturing industries? Is he further aware that the Chancellor's policy of tax cuts plus high interest rates is the exact opposite of what the British economy in general and tourism in particular really need, which are lower interest rates and a lower pound to boost exports, while keeping import prices as high as possible?

I am delighted that the official employment spokesman for the Opposition has, at long last, asked a question about tourism. That emphasises the importance of the industry. How he can possibly say, when our tourist industry is vibrant and buoyant, that the Government's policy has sapped it, I find totally incomprehensible.

Yts

8.

To ask the Secretary of State for Employment how many people are currently on YTS schemes; what percentage of trainees on YTS schemes found jobs on the expiry of their training in the latest year for which figures are available; and if he will make a statement.

At the end of January 1988 there were 413,000 young people in training on YTS.

Results from the Manpower Services Commission's follow-up survey of YTS leavers show that, of those young people who left YTS schemes between April 1986 and August 1987, 60 per cent. were in a job and 14 per cent. were in further training or education when surveyed within a year after leaving.

Has my hon. Friend heard it said that YTS schemes are a source of cheap labour for employers, but do not the figures he has given deny that? Will he always ensure that the educational and training contents of schemes are well up to standard? Will he give the figures for Ealing in terms of YTS trainees in work?

My hon. Friend is right to point out that some people still seek to criticise YTS by suggesting that it is no more than cheap labour for employers. Anyone in that frame of mind has only to talk to many families throughout the country to find out that that is not the position. My hon. Friend is entirely right to say that standards of training must be maintained within the YTS, and they certainly are maintained. As for his own constituency, the figures are even more encouraging than the national average. In Ealing, 64 per cent. of YTS trainees went into jobs and 14 per cent. went into some other form of training.

Is the Minister not being a little smug? Should we all not be concerned if 40 per cent. of our young people are unemployed after two years' training on YTS? Given that in some parts of the country the proportion is very much higher, should not the Minister be making plans to provide work opportunities for those young people? We know that in the Minister's target group for the new adult training scheme. among 18 to 24-year-olds, 25 per cent. have O-levels, 20 per cent. have A-levels and 6 per cent. have degrees, yet they are long-term unemployed. Does the Minister not realise that what is needed is not just more training but jobs for young people so that they can make a worthwhile contribution to their local communities?

I might have had slightly more patience with the hon. Lady had she not used every other occasion to denigrate and rubbish the YTS scheme. The figures are an average, and obviously an average is a combination of high and low target averages. On average, more than 74 per cent. of people go on to jobs, further training or education. By definition, if they had not been on the YTS scheme, presumably they would not have been able to get a job. Both sides of the House ought to be united by the recognition of what is being done for young people, in the hon. Lady's constituency and in mine. She should welcome that, not try to rubbish it.

British Venture Capital Association

9.

To ask the Secretary of State for Employment what plans he has to meet the chairman of the British Venture Capital Association to discuss investment in smaller business; and if he will make a statement.

I met Mr. Lionel Anthony, chairman of the British Venture Capital Association, on 18 January. We had a wide-ranging discussion on ways in which venture capital investment in smaller businesses might be further encouraged, particularly in areas outside the south-east. In addition, I spoke at the BVCA conference in Manchester on 19 February.

Does my hon. Friend agree that the success of the Venture Capital Association and other funds, in producing more resources for smaller firms, is very much to be welcomed? Does he agree that the real anxiety centres on sums much smaller than is commonly invested by venture capital funds? Is he considering introducing, for example, an improved investment fund which would enable sums as small as £25,000 to he found for small firms that wish to expand?

I certainly agree with the first part of what my hon. Friend had to say. Britain's venture capital industry is the most advanced in Europe and has done well. On smaller amounts of finance below that provided by the venture capital industry, I remind my hon. Friend that in the first three years of the business expansion scheme half the firms involved raised amounts of less than £50,000, and nearly two thirds raised less than £100,000. We are always ready to consider further initiatives in this area.

The Minister knows full well, if he talks to the chairman, that there is an equity gap below £250,000, according to some sources, or below £100.000 according to others. However, the fact is that after nine years of this Government there is still a great shortage of investment, particularly outside London and the southeast. Is it not about time that the hon. Gentleman talked to his opposite numbers in the Department of Trade and Industry who have recently shelved a report on innovation centres, because one of the real ways in which small industries and firms can get moving in the high-tech area is if innovation centres are bonded with the ability to provide loans and equity capital? Is it not about time that the Government and those Departments got their act together for small business?

As I have already said, I recognise the problems of raising small amounts of equity capital, but that is what the loan guarantee and the business expansion schemes, and the other schemes that we have introduced, are about. As I have said, we shall go on considering further suggestions that are made.

Small Firms Service

10.

To ask the Secretary of State for Employment if he will make a statement on the progress of the small firms service.

The small firms service, through its information and counselling arms, works to promote viable and profitable small businesses. In 1986–87, in England, it handled over 283,000 inquiries and gave 38,210 counselling sessions. With the development of the local enterprise agencies, it is increasingly developing its counselling activities with established business. Copies of the annual report on the service for 1986–87 were placed in the Library in July.

I am sure that my hon. Friend's support for small business is greatly welcome, but will he say, following his announcement that there will be direct access to the small firms computer database, how that will operate and what benefits there will be for the chambers of commerce and local enterprise agencies?

I intend as soon as possible to make this database, which the small firms service operates, available in computerised form or hard copy form to other organisations in the small business advice area. We are working out the detailed arrangements now and I shall announce them as soon as I am able to do so. The database is already consulted by organisations such as local enterprise agencies and chambers of commerce ringing up the small firms centres. I want them to have direct access so that questions can be answered quickly, authoritatively and easily.

Excellent though the small firms service is, is it not the local enterprise agencies that have contacts at grass root level, so that it is imperative that they work closely together? What specific steps will my hon. Friend take to encourage close integration between the two?

We encourage close integration. The database is a further step in that direction, and, for that matter, so is the integration of counsellors, on which we have been carrying out a pilot experiment in the Yorkshire and Humberside region, which we hope to develop further throughout Britain. Many of our small firms service counsellors operate from time to time in premises supplied, for example, by local enterprise agencies, and we are keen to encourage such co-operation.

Does the Minister agree that the small firms counselling service was started by the Labour Government? What progress has been made by the small firms service in general, against the blows produced by the Government's general economic policy, in stemming the loss of 2 million jobs in manufacturing industry since 1979 and providing jobs in small firms, for example, in engineering and machine tools? Is the small firms service making a positive contribution towards providing proper long-term jobs in the small firms sector?

I think that it makes its contribution. In the nature of things, it is very difficult to measure exactly what piece of advice led to the creation of an individual job, let alone to produce statistics overall. But certainly manufacturing, including engineering manufacturing, is well represented among the firms to which the small firms service gives advice.

Inner Cities

11.

To ask the Secretary of State for Employment if he will make a statement on the measures currently being taken by his Department to improve levels of employment in the inner cities.

The Department of Employment and the Manpower Services Commission provide a wide range of programmes which aim to equip individuals in inner cities and elsewhere with the skills and motivation to compete for available jobs and to stimulate enterprise and the growth of small businesses. The level of commitment is reflected in the estimated expenditure by the Department and the commission of over £1·1 billion in the areas of the 57 urban partnership authorities.

Will my hon. Friend confirm that the inner-city officer in the jobcentre in Wolverhampton will be concentrating his help and energy on those unemployed people in some of the most deprived areas in my constituency, such as Low Hill and Heathtown, as part of the Government's initiative in reducing inner-city deprivation?

Yes, indeed. I had the pleasure of visiting the task force in my hon. Friend's constituency in Wolverhampton recently and certainly those areas, among others in Wolverhampton, are part of his special task.

Will the Minister confirm that many of the employment opportunities to which he refers are temporary, part-time and low-paid, and create an illusion of economic prosperity, rather than the reality, for many people living in inner-city areas?

Does my hon. Friend agree that the inner cities could very well benefit from a substantial share in the extra revenue from tourism in this country, and what steps does he propose to take to ensure that this comes about?

We attempt to encourage tourism in all parts of the country, but my hon. Friend the Parliamentary Under-Secretary of State for Employment, the hon. Member for Pendle (Mr. Lee), who deals with tourism, has a particular interest in creating employment in this way in the inner cities.

Does the Minister accept that the need in these areas is local jobs for local people, as opposed to developments which are attractive to outsiders? When are the Government going to accept that elected local councillors have a crucial role to play in the regeneration of our inner-city areas?

We believe that co-operation between Government agencies, local authorities and the private sector is very important to the creation of local jobs. The hon. Gentleman is quite right in saying that it is local jobs that we require as much as anything, but obviously other jobs have their part to play.

Confectionery Industry

13.

To ask the Secretary of State for Employment if he will estimate how many of those employed in the confectionery industry are full time and how many are part time.

In December 1987 there were an estimated 177,000 employees in employment in the confectionery industry, of whom 42,000 were women working part time. I regret that current estimates of the number of men working part time in this industry are not available, but in 1984 there were about 4,000.

Does my hon. Friend agree that those figures are indeed encouraging, but that they could be increased, according to the Biscuit, Cake, Chocolate and Confectionery Alliance, by some 2,250 if confectionery were re-rated in alliance with foods? Will he undertake to ask his right hon. Friend the Chancellor, even at this late hour, to look upon this favourably, especially since some further 6,000 people would be employed in ancillary industries?

No day of employment questions would be complete without a question from my hon. Friend about confectionery, employment and VAT. I shall certainly draw to the attention of my right hon. Friend the Chancellor of the Exchequer the point made about the projections from the Biscuit, Cake, Chocolate and Confectionery Alliance.

Does the Minister not accept that the figures for the travel-to-work areas are totally misleading, partly because the travel-to-work—

American Tourists

14.

To ask the Secretary of State for the Employment if he will make a statement on the number of American tourists who visited the United Kingdom in 1987.

Figures for the full year are not yet available, but in the first 11 months of 1987, 3,380,000 residents from North America visited the United Kingdom. This compares with 2,672,000 in the same period of 1986 and 3,634,000 in 1985.

Does my hon. Friend agree that the increase in American tourists indicates that the downturn in the value of the dollar has had little effect on the numbers visiting this country and that even more people are likely to come this year? Will he encourage American tourists by telling them that the world does not end at Watford and that there are parts of Lancashire well worth visiting, not least Hyndburn and Pendle?

As a fellow Lancastrian, may I wish my hon. Friend a reet good happy birthday? I am working closely with the North-West tourist board and Lancashire county council to encourage more tourism to Lancashire. With regard to Hyndburn and Pendle, I refer tourists to an excellent article which appeared in last month's Lancashire Life.

Prime Minister

Engagements

Q1.

To ask the Prime Minister if she will list her official engagements for Tuesday 1 March.

This morning I presided at a meeting of the Cabinet and had meetings with ministerial colleagues and others. In addition to my duties in the House I shall be having meetings with Secretary Shultz and with King Hussein later today. This evening I hope to have an audience of Her Majesty The Queen.

I thank my right hon. Friend for that answer. Is she aware that because of the high nonattendance rate of patients, currently at 20 per cent., the waiting list for appointments at Sheffield's Hallamshire hospital ophthalmology, ear nose and throat clinic is now several months? That is typical. Is that something that my right hon. Friend will take into consideration during the review of the National Health Service?

I am aware that from time to time people who are called for operations do not turn up, for one reason or another. I hope that local health authorities will look into the matter. We shall, of course, have a wide-ranging review and take this into consideration. I know that some local health authorities, finding that this was a great trouble which caused operating theatre facilities and skills not to be fully used, established a list of people who could come in at short notice, and thus they have been able substantially to reduce their waiting lists and the time taken to have operations. That is a good practice.

Does the Prime Minister stand by her manifesto commitment to bring more help to low-income families?

Of course we stand by our manifesto commitment. It is only because of the excellent growth that has been achieved by the Government that we are able to do that.

How can the Prime Minister sustain that claim when her own Minister for Social Security and the Disabled admits that, as a consequence of the social security changes coming into effect next month, a family with one parent in work, earning £100 a week, will lose £10·15 in cash, a lone mother in full-time work earning £80 a week will lose £12·60 in cash and all families with one wage earner earning less than £140 a week will lose some money? Is this what the Prime Minister meant, when she spoke about helping low-income families?

As the right hon. Gentleman is aware, the overwhelming majority of low-income families will gain — [Interruption.]— from the social security changes. I think the right horn. Gentleman is referring to a particular list, which depends very much on whether or not they pay average rent. Many people in low-income families do not.

Is that all that the Prime Minister has to say to scores of thousands of people who are working, who earn relatively low incomes and who have one or two children? Are not those the very people whom the Prime Minister tells to stand on their own feet? How can they do that when she is deliberately dragging them down?

We are far from deliberately dragging those people down. They have much better prospects now, and they have had much better prospects, with increased tax thresholds, which they did not have under Labour. I am delighted, therefore, that we have a new recruit to the cause of reducing tax rates.

Would my right hon. Friend care to tell the House how much low-income families have already benefited from the fact that tax allowances have gone up much faster than the rate of inflation?

Yes, Sir. We have put up the tax thresholds very much. That has been one of our priorities, as well as reducing the standard rate of income tax, all of which is very helpful, particularly to people on low incomes. I cannot go any further, for reasons of which my hon. Friend is well aware.

Is the Prime Minister aware that Northern Ireland Ministers plan to introduce legislation imposing certain penalties, including contract compliance and grant denial, on firms alleged to be guilty of job discrimination? Does the Prime Minister intend to extend that legislation to the whole of the United Kingdom to satisfy the grievances, complaints and allegations of various minorities here in England?

I am sure that the right hon. Gentleman would welcome all efforts to ensure that there is no discrimination. It should be a matter only of merit as to who gets a particular job and I hope that he will welcome that piece of legislation for Northern Ireland very warmly.

Will my right hon. Friend arrange to have a Health Minister visit the county of Shropshire to comprehend the importance of cottage hospitals to such an immense geographic area? At the same time, will she remind those who harp on about the level of hospital spending that the Government are financing the building of a £26 million giant hospital in the centre of the county? There is no cut in health spending in Shropshire.

I congratulate the district health authority, which has such excellent results. Since we announced a review of the Health Service we have been receiving details from a considerable number of authorities which say, "We have no cuts in ward services and no cuts in beds. We are not short of money because we are managing our resources well. We have excellent capital improvement, far better than we have ever had under any previous Government. We have more money, more staff, more doctors and more nurses."

Q2.

To ask the Prime Minister if she will list her official engagements for Tuesday 1 March 1988.

I refer the right hon. and learned Gentleman to the reply that I gave some moments ago.

Is the right hon. Lady planning to find time in her busy schedule to see a playback of the recent "World in Action" film "The Taming of the Beeb", in which she is portrayed as responding to criticism by declaring that the BBC must put its house in order? In view of the recent poll showing that the BBC is now seen as a Government poodle, is she satisfied that it has put its house in order? Is she now planning to send a similar message to the Church of England, the Bar Council, the Law Society, the British Medical Association, the British Dental Association, the Committee of Vice-Chancellors and Principals and Conservative peers?

I have great faith in both the chairman and deputy chairman of the BBC.

In view of the recent discussion about the effect of high wage settlements, will my right hon. Friend state whether it is now her view that high wage settlements are a cause of inflation, or a consequence of inflation?

High wage settlements allied to high increased productivity do not have any effect on inflation. It is not a question of a wage settlement, but of a wage settlement in relation to what is obtained for it, and I am sure that my hon. Friend is very much aware of that.

Q4.

To ask the Prime Minister if she will list her official engagements for Tuesday 1 March 1988.

Does my right hon. Friend agree that Europe without nuclear weapons would be very much at the mercy of the Soviet Union, particularly because of the Soviet Union's preponderance of and superiority in conventional and chemical weapons? Will she therefore give an undertaking to the House this afternoon that, when she goes to the NATO summit in Brussels at the end of this week, she will urge her colleagues not to negotiate on the question of nuclear weapons in Europe until, on the one hand, we have parity of conventional forces in Europe and, on the other hand, we have been able to obtain agreement to negotiate away chemical weapons?

Yes, I agree with my hon. Friend that nuclear weapons will continue to play a vital part in our defence in deterring any potential aggressor. The history of two world wars shows that conventional weapons alone are not enough to deter war. I agree with my hon. Friend that after the coming 50 per cent. reduction in strategic ballistic missiles between the United States and the Soviet Union, the next arms control that should be negotiated should be to get conventional and chemical weapons down to parity. Only then should we return to consider nuclear weapons further.

Q5.

To ask the Prime Minister if she will list her official engagements for Tuesday 1 March.

I refer the hon. Gentleman to the reply that I gave some moments ago.

Following the explosion at Crossmaglen last night and the revelation by Sir John Hermon that surface-to-air missiles, provided by Libya, are now in the hands of the Irish Republican Army, does the Prime Minister agree that the best way to counter terrorism is through the strengthening and consolidation of the Anglo-Irish Agreement? Does she also agree about the need to establish a joint security commission, and that justice and security must march hand in hand?

I agree with the hon. Gentleman that we should continue to try to achieve increased security co-operation through the Anglo-Irish Agreement, and it is in the interests of those north of the border and in the interests of the Republic south of the border to do so. I do not agree that it would be wise to set up a security commission. I believe that justice north of the border is for the United Kingdom, and south of the border for the Republic.

Does my right hon. Friend agree that direct international flights into our regional airports are vital to the continued economic regeneration of those regions? Will she remind her right hon. Friend the Secretary of State for Transport that three American airlines have made new applications for flights into Manchester, and that those negotiations should not become buried in matters related to landing charges at Heathrow or any other matters that do not directly concern Manchester?

Yes, I agree that it is important, for the prosperity of regional airports and to ensure that there is not too much congestion in the south, that international flights fly straight into regional airports. My hon. Friend will be aware that we have been active in helping Manchester to get more international flights. Indeed, when I have been on overseas missions I have been active in trying to get more. My right hon. Friend the Secretary of State for Transport will be seeing people tomorrow about the matter that my hon. Friend has raised.

Q7.

To ask the Prime Minister if she will list her official engagements for Tuesday 1 March.

Will my right hon. Friend take the time today to consider whether an amendment might be introduced to the Local Government Bill to prevent Haringey council giving grants to a bookshop which is selling a disgusting comic called "The Scum", which mocks the death of PC Blakelock, who was killed only yards from that shop on the Broadwater farm estate?

Many people would be utterly revolted that any such thing should be on sale, let alone on sale from a bookshop which received a grant from a local authority —

If the report is correct, many people, including, I hope, most Opposition Members, would be utterly revolted by that. What is certain is that measures in the Local Government Bill will strengthen the ban on party political propaganda at public expense and will require local authorities to take proper account of the publicity code of practice that will shortly be placed before Parliament for approval.

The Prime Minister has always taken every opportunity to condemn any act of terrorism, with the notable exceptions of the invasion of Grenada —[HON. MEMBERS: "Question".] — the support for the Nicaraguan Contras and, of course, the air raid on Libya, which was launched from Alconbury and Lakenheath. In view of the recent incontrovertible evidence of South African involvement in terrorism in Angola and other front-line African states, will the Prime Minister tell the House this afternoon whether that is a form of terrorism that she condones or condemns?

The hon. Gentleman is aware that one always condemns utterly terrorism and violence, wherever they occur. They are not a way of solving problems. He will also be aware that there are many peace movements under way in connection with Nicaragua. We wish them success.

Q8.

To ask the Prime Minister if she will list her official engagements for Tuesday 1 March.

Does my right hon. Friend agree that tax harmonisation, which is being aggressively pushed by the European Commission, is not necessary for Community free trade and that, in fact, more genuine free trade has existed between states with very different taxation systems? Will my right hon. Friend ensure that tax decisions affecting this country are taken by this House?

I agree with my hon. Friend that tax harmonisation in the European Economic Community is not necessary for the completion of the single market in 1992. With regard to VAT, there are two quite distinct cases, one under the existing law, which is a directive approved by the Labour Government in 1977 and which became the existing law of the Community—and there have been recent cases decided under that — and the other, which my hon. Friend raises, which is a possible change in the law. In this case I have made it absolutely clear that we should vote against any legislation which deprived us of the ability to make our own decisions on the future of zero-rating for value added tax. Any such change could not go through the European Council except with unanimity, so we would be in a position to determine our own future.

Rover Group

3.31 pm

The Chancellor of the Duchy of Lancaster and Minister of Trade and Industry
(Mr. Kenneth Clarke)

With permission, Mr. Speaker, I should like to make a statement on the Rover Group.

As the House is aware, it is the common objective of the Government and of the Rover Group board to work for the return of the remaining businesses to the private sector. The Rover Group chairman, Mr. Graham Day, has in recent months been considering the options for achieving this.

I should inform the House that an approach has now been received from British Aerospace plc, which has declared a serious interest in acquiring Government shareholding in Rover Group, subject to the satisfactory outcome of negotiations which are now being put in hand. British Aerospace has asked that the negotiations be on an exclusive basis, and the Government have agreed to this, provided that negotiations are concluded by the end of April. If not, we would then be free to look at other options.

I shall, of course, report the outcome of these discussions to the House at the earliest opportunity. In the meantime, I am sure that, like the Rover Group board and the Government, the House will welcome this interest.

Does the Minister accept that his statement makes up in unexpectedness for what it lacks in industrial logic? What is the industrial logic behind such a merger? Is this not a further example of the sort of conglomerate merger which has served British industry so ill in the past?

What can British Aerospace bring to such a merger? It has no expertise in making commercial and motor vehicles, and its experience of selling into international defence markets hardly fits it to tackle the problem of selling into mass markets for motor cars.

Did the Minister take a hand in urging British Aerospace to the negotiating table? Will he explain what provision will be made to ensure a minimum British share in the joint enterprise? Will the minimum requirement for a 15 per cent. shareholding in British Aerospace, plus a golden share, together with the requirement that all directors be British citizens, be maintained in the joint enterprise? If so, what will be the position of Mr. Graham Day?

What is the significance of this merger for the link with Honda? If Honda withdrew, would British Aerospace be prepared to make up, through a capital investment programme, the deficiency that would be left? Have these developments been discussed at all with Honda? If so, what was its reaction?

Why has this statement been made only a matter of days before the Rover Group's annual results are expected, and what will happen to the Rover Group's accumulated debt if the merger goes ahead?

What guarantees will the Government obtain from British Aerospace about the maintenance of employment, about employee rights and about future investment plans for a new model range?

Does the Minister accept that there is more at stake than a clever solution to a short-term problem of his own creation? What is at stake is the viability of a fundamental British industry, the survival and future of a crucial British technology and the continuation of thousands of British jobs in the Rover Group and British Aerospace.

What I have announced is the opening of negotiations between the board of British Aerospace and the board of the Rover Group. I prefer the industrial logic of those who will be involved in the negotiations to the so-called industrial logic of the hon. Member for Dagenham (Mr. Gould), who speaks for the Opposition. He makes a comparison between the proposed merger and some of the conglomerate mergers of the past. He is no doubt thinking back to those conglomerate mergers which were arranged by Governments of which he was a supporter, which at times led to a considerable lack of success. We have moved away from the position where politicians such as he draw their grand conclusions one way or another about the desirability of conglomerate mergers.

The proposal was no result of any urging from the Government. It arose from discussions which began last month between the board of British Aerospace and Graham Day of the Rover Group, and the Government have come to Parliament at the earliest possible stage to inform the House that the negotiations are about to start seriously.

The logic of the merger was no doubt considered by the board of British Aerospace, which has obviously decided, in the interests of its company, to make this approach. It is not a surprising combination because quite a lot of similar combinations occur in the outside world among international companies in the same area. General Motors has a stake in Hughes; Fiat has aerospace interests; Saab has aerospace interests; and, as the House probably knows, Daimler-Benz is in discussions with Messerschmitt-Bolkow-Blohm in Germany. It is for the companies to decide in the course of negotiations the extent to which their interests fit well together and their businesses will prosper.

My understanding from British Aerospace is that it is anxious to retain the services of Mr. Graham Day, but obviously at this stage he is involved with his colleagues in the Rover Group in the negotiations that are about to start.

We have informed Honda that the negotiations are about to start, by contacting the Japanese ambassador in London and by our ambassador in Japan contacting the Japanese Government. The first reaction from Honda is favourable. Certainly the Government would wish the co-operation with Honda to continue, and I believe that to be the wish of British Aerospace and the Rover Group.

The timing of the announcement was dictated by our need to inform Parliament as quickly as possible. The hon. Gentleman asked why we have made the announcement today. We made it today because it was the earliest opportunity, once we and the companies had decided that a serious process of negotiation should begin. It is as a result of those negotiations that all the other matters touched on by the hon. Gentleman will need to be addressed.

Obviously, the long-term employment prospects in the company depend on the success of the Rover business and its success in the market place. We will be in a position to judge, when the negotiations are completed, whether the merger is to proceed; we will then be in a position to judge whether it is in the interests of the business for the merger to go ahead.

Order. May I remind the House that we have a heavy day in front of us, with an adjourned debate on Irish affairs, which must end at Ten o'clock? Will hon. Members put one question at a time?

Will my right hon. and learned Friend accept that most sensible people will wish the negotiations well: that the long-suffering taxpayers have had to hold on and support this very expensive baby for far too long; and that the sooner the remaining 97 per cent. shareholding is returned fully to the private sector, the better it will be for everybody concerned?

The Government have always made it clear that it is our view that the company should be returned to the private sector as soon as possible, so I agree with my hon. Friend: if the negotiations come to a successful conclusion I have no doubt that all those with a serious interest in the well-being of the British car industry will be satisfied with the outcome.

But has the Minister forgotten that last year British Aerospace needed Government money to finance the development of the Airbus? What assurances will he request to ensure that taxpayers' money is not recycled to buy the new Rover Group?

I am astonished that Opposition Members, who allegedly have an interest in British industry, should suddenly start making denigrating remarks about British Aerospace — the hon. Member for Dagenham (Mr. Gould) did that, too. British Aerospace is, I believe, the major exporter of manufactured goods from this country. It received launch aid from the Government last year as part of the launch of a new range of Airbus products. They are selling well, and it is an extraordinary reaction for the Opposition suddenly to start attacking — for some reason — the management or business prospects of one of our major industrial companies. In the end, it is for the two companies to decide for themselves what is in the best interests of their businesses; I prefer their judgment to that of those on the Opposition Front Bench or Back Benches.

While welcoming the early announcement to the House and the early action being taken by the Government to return the company to private ownership as a company, may I ask the Minister to make it clear that the deadline of 30 April is only for the exclusive period of negotiations with British Aerospace and that any other offer made, before or subsequently, would have to he considered by the Government?

That is the case. British Aerospace asked to have exclusive rights of negotiations. It was the opinion of the Rover Group board that it was in the interests of its business that there should be exclusivity in the negotiations, and the Government agree. Before any deal is finalised, if one emerges from the negotiations, we should have to consider any other offers that were forthcoming.

British Aerospace, which must have been watching the Saab advertisements on television, might be a perfectly acceptable bidder for the Rover Group if it could put forward a reasonable scheme that will help the company, but the exclusive arrangement gives rise to many worries. Is it the Government's view that there is no other bidder around that might be able 'to put the British car industry on a sound footing? If there is, why should it be kept out? If there is not, why the exclusive deal?

I share the hon. Gentleman's view that British Aerospace could be an acceptable bidder in everyone's interest — those of the taxpayer, and of Austin Rover as a business, and hence of its employees, too. Because of that, the negotiations are starting and we must all await their outcome. I have just explained to my hon. Friend the Member for Bromsgrove (Mr. Miller) the background to our agreement that negotiations should be exclusively with British Aerospace at this stage. We believe that that would be in the interests of the Rover Group business in particular, and that is also the view of the board.

Is my right hon. and learned Friend aware that, contrary to the moanings of Opposition Members, there will be a feeling of excitement among the many car workers throughout the west midlands at the announcement that the negotiations are to go forward? Is he aware that they will look on this as an opportunity of bringing together two excellent engineering disciplines to make a formidable engineering force in this country, and think it will be a great opportunity for both industries?

I share my hon. Friend's reaction. Car workers in the west midlands will be amazed to hear a few snide remarks made about British Aerospace, coupled with cries from the hon. Member for Great Grimsby (Mr. Mitchell) of, "Where is the logic?" That is the Opposition's reaction to the announcement.

In other countries, these sorts of business have come together with great success. British Aerospace is seeking to diversify its business, as it showed by its successful acquisition of the ordnance factories. We must now see whether the negotiations produce an acceptable result, which we shall consider in due course.

Is it not true that the British Leyland group was a private enterprise disaster that was rescued by over £2·5 billion-worth of taxpayers' money? If the Rover Group is on the road to success, why should the taxpayers be denied the fruits of that success, having poured billions of pounds into the venture? Why should they be denied the fruits of their investment? Will the Minister say how components suppliers will be involved in these negotiations? Will they be involved in the negotiations at all? Hundreds of thousands of jobs are involved, including those at Hepworth and Grandage, which is in my constituency and which supplies 95 per cent. of the Rover Group's pistons? Will it be told to stand on the sidelines while a large part of its market is frittered away in these negotiations?

It is true that the company has lost an enormous amount of money over recent years, and there are accumulated trading losses on its books. I trust that the hon. Gentleman is glad to see that the financial position of the Rover Group is improving. As he knows, towards the end of last year it announced that it expected to declare a trading profit for the financial year ending in 1987.

Negotiations are now going on about the commercial future of the company. Obviously, we must see where those negotiations lead. A deal will be concluded satisfactorily if something emerges that is in the interests of the Rover Group and British Aerospace, and therefore of all those whose interests depend on it.

Does my right hon. and learned Friend agree that today's announcement is a reflection of the achievement of management and workers at British Aerospace, who have enabled the company, post-privatisation, to be able to declare such an interest?

Certainly — British Aerospace has been doing extremely well. It is one of this country's blue chip companies that should expect the support of hon. Members in its present business activities. If it puts together a good deal, it should expect that support for its continuing activities as a major manufacturing company.

Will the Minister accept that the concern of Labour Members and the workers who will be affected in the car and aerospace industries is about the capital for development for car models and aerospace projects for the future? What guarantees will the Minister be seeking as an outcome of these negotiations to ensure the future of models and jobs at Cowley, Longbridge and other plants?

It is obviously the responsibility of those engaged in the management of a company to consider the future capital needs of the business and how they intend to meet them. No doubt the management will be addressing those problems in the course of these negotiations. The capital needs of businesses of this kind are best served when they are in the private sector competing successfully as private sector companies. No doubt the future capital needs of both businesses will be very much in the minds of those taking part in the discussions that are about to start.

Will my right hon. and learned Friend comment further on the complementary skills that this merger might bring after successful negotiations? Will he comment on the help that it will give component manufacturers supplying British Aerospace and Austin Rover, such as those based in Coventry and Birmingham, which are now being helped by the upturn in the economy?

Obviously, it is for British Aerospace to explain its judgment that there is a clear relationship between the two businesses and that they could successfully complement each other. I know from my contacts that British Aerospace believes that to be the case. It thinks that it is a good opportunity to diversify, and that there is a great deal of synergy between the engineering skills used by both companies. They are both major manufacturers of engineered products, and in other countries similar groups seem to have sat together very well. We must wait to see whether a successful negotiation can be concluded to bring the two companies together on acceptable terms.

Is it not clear that, despite the Government's climbdown of a couple of years ago, Mr. Graham Day was brought in by the Government more as an undertaker than a physiotherapist, to prepare for the privatisation of the Rover Group? One of the key preparations for that privatisation occurred last year when he authorised the theft of £ 80 million of workers' deferred wages from the pension fund to make the balance sheet look more attractive for this bid from British Aerospace. To repeat the question that some of my hon. Friends have asked, what guarantees will the Minister seek from British Aerospace for continuity of employment? Experience of Leyland privatisations in Coventry at Self-Changing Gears, Alvis and Climax shows that workers have paid the price in unemployment.

Graham Day was brought into British Leyland because of his considerable and undoubted managerial and business skills. His managerial skills and those of his team are one of the assets of the company and will no doubt be considered by the other company expressing an interest in acquiring it. I should certainly very much prefer Graham Day, with his judgment and skills, to anyone who might be appointed by Opposition Members on the advice of the hon. Member for Coventry, South-East (Mr. Nellist) to take over responsibility for a major industrial company.

In this industry, as in any other, continuity of employment depends on success in the market place; as my hon. Friend the Member for Meriden (Mr. Mills) pointed out, those who depend on the companies for their business well-being are going through a very satisfactory time.

Will my right hon. and learned Friend remember that commercial logic as exemplified by the Labour party's policy includes Meriden and Upper Clyde Shipbuilders, and forcing Bristol Commercial Vehicles into the hands of British Leyland, which promptly closed it down? Does he not agree that it is regrettable that Opposition Members seek to denigrate British Aerospace—a company that produces goods that the world wants to buy and employs many thousands of our constituents?

I agree with my hon. Friend, and we must never return to the days when politicians decided that their judgments of commercial logic made more sense than those of business men and tried to draw companies together. We are now witnessing a knee-jerk reaction from Opposition Members. They are scratching about to try to find criticisms of British Aerospace to put a damper on the negotiations. We shall leave the negotiations to take their course. In the end, our decision will be based on a judgment of the best interests of taxpayer, business and employee.

The only reason why we are discussing Austin Rover is that public money kept volume car production going in that company. Furthermore, the Minister will recall that only last week his right hon. Friend the Prime Minister, who is sitting beside him, reminded the House that nearly £3 billion of taxpayers' money went to support Austin Rover. What guarantee can the Minister give that the taxpayer will get a decent return on the money invested before the company is privatised?

We shall have to await the results of the negotiations. I agree with the hon. Gentleman that when the negotiations are concluded we shall have to ensure that the interests of the taxpayer are properly protected.

We shall accept an offer for the Government's shares only if we are satisfied that the taxpayers' interests are protected. In measuring those interests, one needs to consider the value of the business now. It is an extraordinary proposition to look back over the years and say that, because £2.9 billion was lost and had to be found by the taxpayer when that sum would otherwise have gone into public services of one kind or another, that is somehow a measure of the value of the business today. I invite the hon. Gentleman to reflect on the position and to accept my undertaking that, when the negotiations are concluded and a proposition is put to us, we shall ensure that the taxpayers' proper interests are safeguarded.

If the discussions with British Aerospace did not come off, would the Government welcome a further approach from Ford or General Motors for the Rover Group?

At the moment, we have agreed to negotiate only with British Aerospace. Obviously, if other companies come forward with propositions, we shall consider the options before us and, after the period of exclusivity that has been agreed — if the matter is still open—we shall consider whatever options are available.

Does my right hon. and learned Friend agree that the denigration of British Aerospace by the hon. Member for Dagenham (Mr. Gould) is unlikely to strike a chord with the Tornado workers in Lancashire, who are working on a £5 billion Tornado contract won by British Aerospace? Surely all those in the defence industry recognise the expertise of British Aerospace and that we are now the third biggest manufacturer of defence equipment in the world. That is something from which the car industry, of which British Leyland is part, will benefit considerably.

I entirely agree with my hon. Friend, and I share his surprise. I suspect that the reaction of Leyland workers will be similar to his and mine when they consider British Aerospace as prospective bidder for their business. It is one of our flagship companies and the major exporter of manufactured goods from this country. It is extraordinary for Opposition Members to imply that it is not a welcome suitor for an extremely important car business.

Will the Minister reflect on the particular problem of the Rover-owned huge British Leyland site at Bathgate, which until 10 years ago was the biggest machine shop under one roof in Europe? To try to solve that difficult problem, would the Minister arrange for staff from his Department to meet British Aerospace, Rover, West Lothian district council and Lothian regional council before the buildings deteriorate any further?

Bathgate stands rather as a monument to past political decisions on investment made by people who share the industrial logic of Opposition Members. I agree, however, that its closure was something of a disaster, and the redevelopment of the site and the establishment of new industry and employment for the people of the area is extremely important. That is a matter for my right hon. and learned Friend the Secretary of State for Scotland, but my understanding is that there is indeed a prospect of redevelopment of the former site. I shall check that information, and perhaps my right hon. and learned Friend will be in touch with the hon. Gentleman.

Is the Minister aware that many people, particularly in the west midlands, will be saying that, if the £2.9 billion that was handed out as a subsidy to keep the ailing Rover Group going finds its way into the pockets of the new group — [Interruption.] It will do so eventually. Is the Minister aware that those people may well say that they ought to have some of the money for the National Health Service in the west midlands?

Is the Minister further aware that, if British Aerospace could be fattened up with £400 million before it was sold off, some people might also say that, if they are going to build one of those gull-wing cars, they ought to be asking John De Lorean for some advice?

The hon. Gentleman must realise that the £2.9 billion is not sitting there as some kind of nest egg put carefully aside by the taxpayer. It has all been lost.

A lot of people who have lost money want it back, as the hon. Member for Birmingham, Erdington (Mr. Corbett) points out. But, sad to say, it is not there to be got back. The people of the midlands, as the hon. Member for Bolsover (Mr. Skinner) has said, will no doubt reflect on what might have happened if the money had been available for the Health Service, or indeed for many other purposes.

The point of our present position is that Britain's industrial economy is revising. The Rover Group is reporting improved financial prospects. We have a negotiation in hand that may lead to the return of the Rover Group to the private sector. All this is opening up the prospect of our never again putting taxpayers' money down the drain in the way that we did in the past, to the tune of £2·9 billion.

Order. I shall endeavour to call hon. Members who have been standing, if they are brief, but I think that we must end these questions by 4.15.

Given the excellent track record of British Aerospace, and despite what has just been said, will my right hon. and learned Friend confirm that this is potentially excellent news for the west midlands? Is he aware that it is very important that the Rover Group should survive, not least because of the car components industry in the centre of England?

I can assure my hon. Friend that everyone in the Government realises the key importance of the Rover Group to the economy of the west midlands. Our desire throughout has been to try to create a climate in which the Rover Group can return to profitability in due course, and be successful as a car manufacturer. We shall look at the deal from the point of view of the interests of the taxpayer, those of the Rover Group business and everything that flows from that.

It must indeed be very good news in the west midlands that the Rover Group is regarded as a potentially attractive acquisition by British Aerospace, and that serious negotiations can now begin.

As the satisfied owner of two Austin Rover motor cars—a rarity in the House, perhaps—and also as a pilot, may I say to my right hon. and learned Friend what an ideal merger this seems to me? Does he not agree that the financial strength of British Aerospace, its international marketing expertise and its engineering excellence make it not only the ideal but the No. 1 partner for Austin Rover?

That is certainly the view of the British Aerospace board, and of the Rover Group. I agree that the sales record of Airbus in the civil sector, and that of British Aerospace in the military sector, show that the company is indeed attractive, and that we in this country should be proud of it.

We shall wait to see whether the merger takes place. In other countries, however, mergers between companies of this kind have been successful. I do not think that when General Motors and the Hughes Corporation of America joined up they were impeded by Socialist members of Congress crying out about the industrial logic.

Will my right hon. and learned Friend accept that the Rover Group does not have a cat in hell's chance of succeeding as a separate, individual private company? Will my right hon. and learned Friend explain to the Opposition that the £2·9 billion has gone for ever and that the company can only succeed in the future either under the umbrella of another established company or by being irrevocably linked with the taxpayer's pocket? If the merger talks do not succeed, will my right hon. and learned Friend look actively for other partners to take part in negotiations, so that the Rover Group will have a real chance of an independent future?

I am extremely interested in the views of my hon. Friend, who has a considerable knowledge of the car industry and engineering generally. It is certainly true that British Aerospace is small in comparison with the companies with which it competes — McDonnell Douglas, Boeing, Lockheed and so on. Rover Group is also quite a small company compared with its competitors in western Europe and elsewhere. No doubt size was one of the factors which led the two companies to contemplate entering into the present negotiations. I agree with my hon. Friend that the £2·9 billion has gone and it is a mark of past losses. We do not wish to see any repetition of that scale of loss-making.

Is it not a tiny little bit ironic that the Opposition Front Bench spokesman, the hon. Member for Dagenham (Mr. Gould), should be whining about supposedly Government-inspired megamergers, when it was a Labour Government in the 1960s who forced together BMC and Leyland in the first place? Does my right hon. and learned Friend not prefer the industrial logic and experience of business men and industrialists to the ludicrous lack of logic of Opposition Members, most of whom have had no industrial experience whatever?

I am entirely horrified by the prospect of the hon. Members for Dagenham and for Great Grimsby getting their heads together and deciding what suitable partners, if any, they would choose for the company. I agree with my hon. Friend that the method that we are now adopting, which is to see how commercial negotiations proceed between the boards of the two companies, is a far more satisfactory route.

Is it not thoroughly good news that Rover may be teaming up with a British company which spends millions of pounds every year on research and development and which can attach the same importance to the technology of Rover's product development?

It is thoroughly good news, and the deafening silence now apparent on the Opposition Benches suggests that that thought may have occurred to them after the first rather reckless 10 minutes.

Order. The hon. Gentleman has asked his question. He may not have had it fully answered, but he has asked it.

Does my right hon. and learned Friend agree that this is very exciting and positive news? British Aerospace management has the capability and expertise to design, manufacture and sell in major world markets and it will, I hope, make Rover Group a most successful company, certainly equal to British Aerospace.

That certainly could be the outcome of negotiations. I agree with my hon. Friend that, if negotiations come to a successful conclusion, it could represent the beginning of an extremely exciting phase in the business of both companies.

I thank my right hon. and learned Friend for coming to the House so early to make this announcement. Does he agree that the application of British Aerospace technology and quality control will do much to enhance the recovery of the Rover Group? Does he also agree that the prospects of merger create exciting prospects for employment? As robotics reduces the demand for labour in the car industry, that skilled labour can be actively and beneficially redeployed within the aerospace industry.

As I understand it, British Aerospace is also interested in some of the engineering skills within the Rover Group. What the two companies are exploring is, I believe, the extent to which there is — to use the in phrase—natural synergy between the two businesses that could benefit the companies and prospects for employment within them.

Does my right hon. and learned Friend agree that one of the disadvantages of a board choosing its own bidder is that board members can secure their own positions? Does he agree that the Rover Group board has not exactly covered itself with glory? Would it be an advantage to allow the market to decide—in other words to allow all comers to make a bid at this stage?

In the end, the Government are the owner of 99.8 per cent. of the shares, and we shall have to make our judgment about the sale of the shares subject to the outcome of the negotiations. We will do that at the proper time. I have already said that, if other people wish to come forward with proposals at this time, we shall have to consider them before we come to any final decision. If the current negotiations are unsuccessful, it remains the committed policy of the Government to return the Rover Group to the private sector during the lifetime of this Parliament. If the negotiations are successful, privatisation may come about very early in the lifetime of this Parliament; I am sure that my hon. Friends will welcome that.

Does my right hon. and learned Friend agree that, in any deal that may be struck with British Aerospace or any other suitor, an important feature for the taxpayer and the Government should be to ensure that contingent or direct liabilities currently falling upon the taxpayer are removed from the public sector?

Once the business is privatised, we would obviously not be incurring any future liabilities from it. That should come as a considerable relief to the taxpayer, bearing in mind the history of the company, of which, surprisingly enough, Opposition Members keep reminding us during these exchanges.

To what extent would the pension fund contribution to the balance sheet — referred to by my hon. Friend the Member for Coventry, South-East (Mr. Nellist)—be a consideration for those who might be interested in this particular deal?

At the moment, what I have announced is the opening of negotiations. The balance sheet is one of those things that must be looked at during the course of negotiations. To the best of my knowledge and belief, no asset in the pension fund played a significant part in the approach from British Aerospace.

Will the Minister, who trumpets the revival of British industry the day after a £950 million deficit in the balance of payments, explain in more detail his attitude to the use of £80 million of the workers' pension fund to dress up the books of part of a company that had to be rescued from private enterprise in 1975? The books were dressed up to make the company more attractive for privatisation. Will the Minister give a guarantee that when he approves any merger, if it takes place, the workers' pension fund will not be used again for such activity?

The hon. Gentleman must take up the question of the accounts and the pension fund arrangements with the management of the Rover Group. A pension fund, accumulated as a result of the contributions from the employer and the employee, is used to defray the pension obligations that have been incurred by the company. The hon. Gentleman will be aware that, in recent years, a number of pension funds have been in surplus. As far as I am aware, the Rover Group has not done anything with its pension fund surplus that is out of line with commercial practice in other companies.

Is it not totally unsatisfactory that, throughout the past 37 minutes, the Chancellor of the Duchy of Lancaster has disclaimed any responsibility for the outcome of the negotiations that he has announced today? Does he not accept that it is not just a matter of market forces and private negotiation? The Government, as the virtual sole owner of the Rover Group, cannot simply shuffle off their responsibilities in this way. Bearing that in mind, what responsibilities does he acknowledge, and how does he propose to discharge them, with regard to such items as the maintenance of employment, the protection of employee rights, including the pension rights mentioned by my hon. Friends, and the crucial maintenace of an investment programme for new models? Does the Minister intend at this stage to wash his hands of those questions, or will he now face up to his responsibilities?

What I have announced today is that serious negotiations are about to start. I have not sought to anticipate the course of those negotiations. Obviously the Government will not come to a judgment about the outcome of the negotiations until they have made more progress and they have been completed.

We have the logic mentioned again by the hon. Member for Great Grimsby.

The hon. Member for Dagenham appears to believe that, once we announced the start of negotiations, he, in his wisdom, together with his hon. Friends, should immediately start jumping to their conclusions about various aspects that may or may not be raised. I believe that the Government have acted with the utmost propriety by notifying the House straight away that negotiations are about to start. We are waiting to see what those negotiations will produce and we will judge them at the right time. We shall judge them according to the interests of the taxpayer, Rover Group business and its employees. That is the proper way to proceed. All those who want to behave with a sense of responsibility and who have the genuine interests of the Rover Group and British Aerospace at heart should behave in the same way. I hope that, on reflection, the Opposition will do so.

Cervical Cancer (Testing And Treatment)

4.9 pm

I beg to move,

That leave be given to bring in a Bill to establish a body known as the National Cervical Cancer Service, which will be responsible within the National Health Service, for managing a national system for making cervical cancer tests available once every three years to all women aged between 20 and 65 years, and for supervising the provision of treatment for cervical cancer; to provide for the making of tests by doctors acceptable to the women concerned; to provide through the National Cervical Cancer Service for action to make women aware of the need for such tests; and for purposes connected therewith.
The Bill would require the establishment of a nationally managed computer-based system of testing for, and the subsequent swift treatment of, cervical cancer for all women between the ages of 20 and 65, for all women to be tested once every three years, and for that service to be adequately and fully funded by the DHSS.

The Bill is simple, but it could virtually eliminate 2,000 needless deaths of women throughout the United Kingdom every year. I know that women in my constituency are dying needlessly of cervical cancer. It is certain that women are dying needlessly in every constituency in the United Kingdom, as 2,000 women every year die of cervical cancer, although, detected in its early stages, it can almost always be cured completely.

The smear test is simple, only slightly uncomfortable for the women concerned and can be carried out by a GP or a trained nurse. The resultant smear is captured on a glass slide and sent for analysis to a cytopathology laboratory. Examination there can reveal that a patient has nothing to worry about or that she should report to the appropriate hospital for straightforward treatment that almost always results in a complete cure.

It is a public scandal that women have to wait five months for colposcopy clinical tests and nine months for laser tests for that treatment. Despite that comparatively simple cycle of test and treatment, some 2,000 women die of cervical cancer every year in Britain.

Investigation shows that more than 60 per cent. of those who die have never had a cervical smear test. Obviously, the current system is not working, although the Government aim for the testing of every woman in the United Kingdom between the ages of 20 and 65 once every five years. The cost of carrying that out effectively is estimated at some £30 million, and it should give 70 per cent. protection to those at risk. However, testing the same age range of women once every three years would give 90 per cent. protection and would cost only £20 million more.

That is a small cost, by comparison with a weapons system, which we should hardly begrudge a vital area of preventive medicine. Such a screening policy almost certainly could be implemented within the existing National Health Service budget if the screening programme were to effectively managed on a national scale, supported by compatible computer sytems in doctors's surgeries and in FPCs and cytopathology laboratories equipped with specifically designed information technology systems.

Currently, the British programme is not effective because the majority of smears have been taken from women in the lower-risk categories. That is because most smears are taken during obstetric and contraceptive consultations which normally arise in the cases of women under the age of 40, the age group least at risk.

The five-year gap between screenings, the poor management of call-recall systems, the reliance upon manual records instead of computerised systems, the reluctance of many GPs to carry out preventive medicine, the natural fear of women faced with the word "cancer" and poor eductional programmes, all lead to women neglecting or forgetting to obtain a smear test.

However, the computerisation of family practitioner committee lists and of some GPs' patient records means that an operational database is being built up, but it is taking place in a piecemeal, undirected fashion which negates its potential. For the scheme to work successfully, there needs to be a nationwide scheme based upon compatible computer systems with common operating standards and management procedures.

There is also a need to equip cytopathology laboratories in every health authority with specific computer systems that will handle all data arising out of the prevention of cervical pre-cancer and will embrace fine needle aspiration cytology, endoscopic "brushes" and general cytology such as sputum and other body fluid samples. Such a computer system should be capable of being extended to handle breast data. Those systems should interact with the FPC computer systems.

So far, less than 25 per cent. of Britain's 200 cytopathology laboratories are equipped with adequate computer systems. That lack of provision seriously hampers the successful operation of Britain's national screening programme and contributes significantly to the figure of 2,000 women dying needlessly every year.

The Government appear to believe that they have done all that is necessary by at long last computerising FPCs. However, because of the Government's negative attitude towards funding, FPCs have been unable to recruit and maintain staff of a standard high enough to deal effectively with the vast data handling. Existing patient records have a serious error rate of 30 per cent. Data entry is likely to be slow and to require constant revalidation. FPCs are commending call programmes without reference to existing GP-based systems in their areas. That causes repetition of testing and alarm to women recently tested by their GPs.

Furthermore, the FPC computer systems have not been designed to handle interaction with a cytopathology laboratory computer system. In due time, and with improved management, all those barriers to a successful call-recall system may be overcome, but it could take several years—an unacceptable delay, considering those 2,000 needless deaths every year.

Current cytopathology laboratory computer systems, such as the one already operating at Southampton's general hospital can handle call-recall systems via GPs and, keep FPCs informed so that records can be updated. They can do that in addition to their laboratory-related work.

In order to increase the productivity of all United Kingdom cytopathology laboratories so that none fails to meet the Government guideline of turning round smear screenings in under a month, and so that significant improvements in the call-recall system can be achieved prior to the eventual tardy implementation of the national FPC system, the Government should establish a body entitled the national cervical cancer testing service.

That body should be established under the authority of the Department of Health and Social Security, which will have responsibility for establishing, managing and implementing a nationwide common system for the testing for cervical cancer once every three years of all women between the ages of 20 and 65. That service would be responsible for ensuring that all women whose health was found to be at risk would receive adequate and timely treatment.

That body would be charged with meeting the following basic requirements: the provision of adequate resources for taking, examining and reporting on cervical smears and the provision of adequate, computer-based clerical systems for the making and keeping of examination appointments.

In Scandinavia, it is national policy to treat all symptoms of illness detected during screening for cervical cancer even if they are not cancerous conditions. That has raised the general health level of women considerably.

The Government have given guidance in their new DHSS health circular issued on 12 January 1988 that their objective is to reduce mortality from cervical cancer by regularly screening all women at risk to identify and treat conditions that might otherwise develop into cancer. It goes on to ask district and regional health authorities to implement the circular's provisions.

As usual, the Government are long on exhortation and short on properly financed action. I remind those Ministers responsible that each of the 2,000 needless deaths of women each year costs the United Kingdom some £15,000. That sum does not take into account the considerable additional costs that arise in state support—

If humanitarian grounds do not move the Administration, perhaps the prospect of financial savings will. I beg my colleagues to support the Bill.

Question put and agreed to. Bill ordered to be brought in by Mr. Jimmy Wray, Ms. Joan Ruddock, Mrs. Maria Fyfe, Ms. Harriet Harman, Ms. Clare Short, Mrs. Alice Mahon, Mr. Alfred Morris, Mr. Eddie Loyden, Mr. Jimmy Hood, Mr. Don Dixon, Dr. Lewis Moonie and Mr. Alan Meale.

Cervical Cancer (Testing And Treatment)

Mr. Jimmy Wray accordingly presented a Bill to establish a body known as the National Cervical Cancer Service, which will be responsible within the National Health Service, for managing a national system for making cervical cancer tests available once every three years to all women aged between 20 and 65 years, and for supervising the provision of treatment for cervical cancer; to provide for the making of tests by doctors acceptable to the women concerned; to provide through the National Cervical Cancer Service for action to make women aware of the need for such tests; and for purposes connected therewith. And the same was read the First time; and ordered to be read a Second time upon Friday 13 May and to be printed. [Bill 107.]

Business Of The House

Ordered,

That, at this day's sitting—
  • (1) notwithstanding the provisions of paragraph (1) (b) of Standing Order No. 14 (Exempted business), if proceedings on the draft Northern Ireland (Emergency Provisions) Act 1978 and 1987 (Continuance) Order 1988 have not been previously disposed of, Mr. Speaker shall at Ten o'clock put the Question thereon; and
  • (2) Standing Order No. 14 (Exempted business) shall apply to the Motion in the name of Mr. Secretary King relating to the draft Appropriation (Northern Ireland) Order 1988 with the substitution of One o'clock, or three hours after it has been entered upon, whichever is the later, for the provisions in paragraph (1) (b) of the Standing Order. —[Mr. Alan Howarth.]
  • Unemployment Benefit

    4.21 pm

    I beg to move,

    That the draft Unemployment Benefit (Disqualification Period) Order 1988, which was laid before this House on 19th February, be approved.
    As the House will be aware, disqualification for unemployment benefit in various circumstances that are broadly termed "voluntary unemployment" has been part of the unemployment insurance scheme since 1911. Originally, disqualification was set at a maximum of six weeks and the Social Security Act 1975 maintained that figure while retaining the principle as well. However, the period was extended to a maximum of 13 weeks in 1986.

    The present draft order has one clear purpose. It extends from 13 weeks to 26 weeks the maximum period during which someone may be disqualified for receiving unemployment benefit if his unemployment is brought about by his own action or failure.

    Undoubtedly someone who is in whole or in part responsible for his lack of work should not be able freely to draw benefit. Under current legislation, a person may be disqualified from receiving unemployment benefit for a maximum of 13 weeks in various circumstances that are generally termed "voluntary unemployment". As I announced to the House on 10 November, we now intend to strengthen that sanction.

    We propose to extend the period to a maximum of 26 weeks. At the same time, we are amending the regulations relating to members of the armed forces to bring them into line. They contain a provision whereby a person who was a serving member of the forces is disqualified from benefit for a fixed period if he is discharged, cashiered or otherwise dismissed. If the House approves the order, that period will cease to be fixed and will become a maximum of 26 weeks.

    We also intend to continue the position that someone who is disqualified from receiving benefit in any of those circumstances will have any income support to which he may be due reduced for the same period. The relevant legislation for this will be introduced shortly with other income support changes in amendments to the Income Support (General) Regulations. I stress that in all those situations the 26-week period that I have mentioned will be the maximum that can be imposed.

    As the law stands at the moment, a person is disqualified from receiving unemployment benefit if he loses a job through misconduct or leaves one voluntarily without just cause, or if he refuses a suitable job vacancy, fails to take advantage of a reasonable opportunity of receiving approved training or fails, without good cause, to carry out official recommendations to help him to find suitable employment. The current Employment Bill provides for the circumstances of disqualification to be extended to people who have lost a place on an approved training scheme through misconduct or have left such a place voluntarily without good cause and also to those who refuse without good cause to apply for or accept such a place.

    In any case of voluntary unemployment, if a claim for supplementary benefit is made, entitlement is reduced, normally by deducting 40 per cent. from the claimant's personal benefit rate. Amounts for dependants are not so reduced. The deduction is at the lesser rate of 20 per cent. if any member of the household is either pregnant or seriously ill and the claimant's capital does not exceed £100. The £100 capital limit is being raised to £200 with the introduction of income support in April.

    The maximum period for disqualification for the various situations of "voluntary unemployment" was increased to 13 weeks in October 1986. However, for people leaving the armed services, there was no such change. For them the period has remained at six weeks. People leaving the armed forces are not, and never have been, subject to a penalty for leaving voluntarily. Nor has the period of disqualification for people dismissed from the armed forces ever been other than a fixed period penalty, leaving no room for former service men to show good reasons for the imposition of a lesser disqualification period. Following discussion with my right hon. Friend the Secretary of State for Defence, we have decided that, in equity, former members of the forces should be subject to the same maximum—and flexible—penalty as other people.

    The House will wish to know why, having increased the maximum period of disqualification to 13 weeks in 1986, we are now introducing a further increase. A main purpose of the voluntary unemployment sanctions is to discourage people from acting in a way which leaves them unnecessarily without work and a charge on the public purse. There will, I imagine, be few who will quarrel with the general principle.

    Following the 1986 change, one would have expected the percentage of unemployed people claiming benefit in situations of "voluntary unemployment" to have fallen. On the contrary, the absolute number of instances where a disqualification or deduction was imposed rose, and that was at a time when, because of a strengthening economy, there was much work around and total claims for benefit from unemployed people were dropping significantly. The Government have concluded that more effective measures are required to discourage voluntary unemployment. Hence the increased maximum period that we are proposing.

    Disqualifications are not imposed indiscriminately. Decisions on unemployment benefit and on the circumstances to which a disqualification or benefit deduction should be made are, as hon. Members on both sides of the House well know, taken by independent adjudicating authorities. The adjudication officers are the first tier of those authorities. Decisions are reached on the basis of applying the legislation governing the benefit, and the relevant case law, built up over the years, to the circumstances of the individual case. In ascertaining the facts, inquiries are made of the former employer, and the claimant is given the chance to comment on the employer's statement and to offer his own account of events.

    The length of any disqualification is for the adjudication officer to decide. The chief adjudication officer's advice to local adjudication officers is that in each case
    "a sensible discretion has to be exercised in such manner as the justice of the case requires. All the circumstances must be taken into account."
    He also points out:
    "the statutory authorities have a complete, unfettered discretion, provided it is exercised judicially."
    Anyone who is dissatisfied with an adjudication officer's decision has the right of appeal to an independent social security appeal tribunal, and from there, on a point of law, to a social security commissioner. In view of the quite proper independence of the adjudicating authorities, neither I nor any other Minister or departmental official can influence or interfere with their decisions.

    This is a long-standing adjudication system which people who have experience of it believe to work well. We are not proposing any changes in the way in which the benefits will be administered or the decisions taken. Matters will still be decided by the independent adjudicating officers and there will still be the right of appeal against an adverse decision to an independent tribunal. Appeals can be taken on the length of a disqualification period as well as on the imposition of any period at all. All we are proposing now is to increase the maximum period for which the adjudicating authorities can impose a disqualification.

    It is obviously not right, and never has been, under a Government of either party, that someone should be able to draw benefit without penalty if his unemployment is due to some action or omission on his part for which he has no acceptable reason. Someone dissatisfed with a job should not give it up lightly and expect to receive benefit. He or she should do everything reasonable to avoid becoming a charge on public funds, funds which are contributed to by many others who may be equally concerned to better their situation but who avoid precipitate or irresponsible action.

    Knowing people who, in past years, have suffered from this sort of thing, could I ask the hon. Gentleman to explain precisely what he means when he says that a person should not lightly give up a job? Does he honestly believe that an ordinary working person who has to live on a weekly income gives up a job lightly? Could it not be that someone is working under very bad conditions? The employer might say that they are good conditions, but that worker cannot tolerate them any longer; so he leaves the job and finds himself in this situation.

    The hon. Gentleman is going back to the principle which, if he was here at the beginning of my remarks, he will remember I said has been established since 1911. Other amendments to it have been introduced. A reduction in social security benefits was introduced by the Labour Government in 1948. The principle has not been challenged before.

    Perhaps the hon. Gentleman will restrain himself for a moment. The principle is not at issue, and that is what the hon. Gentleman has raised. The point that we are discussing today is the maximum period that adjudicating officers ought to impose in a situation in which voluntary unemployment takes place. The hon. Gentleman seems to me to be challenging the principle, and I do not believe that that is at issue. What we are arguing about today is whether it is right that this period should be extended from 13 weeks to 26 weeks at a time when unemployment has been consistently falling for many months, opportunities for employment are growing, and yet the incidence of unemployment has been growing. In those circumstances, I believe that the Government are justified in taking this step.

    The Minister has now said twice that, since the increase to 13 weeks was made, the number of those registering as voluntarily unemployed has increased. He will be aware of the answer that was given in the House only last month, which showed that, in the first three quarters after the increase to 13 weeks, there was a steady decline in the number held to be voluntarily unemployed, from 113,000 in the first quarter to 98,000 four quarters later. The numbers are reducing, not going up, and the Minister really cannot mislead the House twice in the same speech.

    I hope that the hon. Gentleman will not accuse me of misleading the House, but will listen quietly for a moment while I explain to him exactly what the figures are.

    A parliamentary question was answered and it was, in a sense, quite right to suggest that during the period covered by that answer the figures had been falling. Nevertheless, the aggregate over the three quarters since the maximum period was increased from six to 13 weeks had increased compared with the same period a year earlier. Over the nine months from October 1985, there were 306,000 disqualifications, compared with 310,000 in the corresponding nine months from October 1986. That shows an increase of just under 2 per cent. As I say, that has to be set against the background of the drop in unemployment, the increase in the number of vacancies, and therefore the increasing opportunities for employment. Disqualifications have therefore risen over that period from 8 per cent. to 9 per cent. of the total claims for that period.

    Is the Minister seriously telling the House that we have to impose this 100 per cent. increase in the period of disqualification because of a mere 2 per cent. increase in the numbers registering as voluntarily unemployed—an increase of a mere 5,000 out of a total of 300,000? If that is the best that the Minister can do, he might as well pack up now and withdraw this order.

    For the quarters referred to by the hon. Gentleman, the increase in the percentage of claims where disqualification applied was 26 per cent. That is the figure that he ought to have in his mind. Perhaps he would go back to his books and check the figures.