Skip to main content

Commons Chamber

Volume 164: debated on Monday 18 December 1989

The text on this page has been created from Hansard archive content, it may contain typographical errors.

House Of Commons

Monday 18 December 1989

The House met at half-past Two o'clock


[MR. SPEAKER in the Chair]

Private Business

Birmingham City Council (Miscellaneous Provisions) Bill Lords

Read a Second time, and committed.

Oral Answers To Questions


Electricity Privatisation


To ask the Secretary of State for Energy what estimate he has made of the likely impact of privatisation on electricity prices; and if he will make a statement.

Competition in electricity generation and supply, combined with price control where monopolies remain, will put downward pressure on prices to the benefit of the consumer.

Will my right hon. Friend do his utmost to see that the undoubted efficiencies arising from privatisation are passed on in the form of reduced costs and to ensure that any additional future costs arising from nuclear decommissioning are not passed on as extra costs?

The regulatory regime will provide for benefits to be passed on to consumers. On nuclear energy, as in the past, electricity customers will continue to pay the best estimate of the cost of the decommissioning when they purchase electricity. We have taken powers to contribute to these costs should they subsequently increase.

With regard to the impact of privatisation on electricity prices, does the Minister understand the sense of moral outrage that there will be throughout the country at today's announcement that Lord Marshall is to receive a golden handshake of £250,000? Does the Minister agree that because of his record of advice on nuclear power and the dishonest costing of nuclear electricity, Lord Marshall's decisions and advice have cost us billions of pounds? Would it not be a suitable epitaph for Lord Marshall if the Minister had the courage to cancel the last of the pressurised water reactors and scrap Sizewell B?

The Government have made clear their intentions on Sizewell B. We wish to see the completion of that project. As several hon. Members know, I have today received and accepted Lord Marshall's resignation as chairman of the Central Electricity Generating Board. Lord Marshall feels that in the light of my recent decisions on nuclear power he is unable to continue as chairman of the CEGB and as chairman-designate of National Power. In accepting Lord Marshall's resignation, I pay tribute to his long and distinguished career in pubic service and to his stewardship of the CEGB during the past seven years.

Is my right hon. Friend aware that the low cost prices given by the CEGB in the past for nuclear electricity have now been largely discredited? In the light of that, is my right hon. Friend inclined to believe the new high cost prices for nuclear electricity that have been given in different circumstances—with the CEGB being responsible for privatised nuclear electricity—or does he think that they, too, should be treated with a pinch of salt?

As my hon. Friend is aware, because he studies these things closely, the indicative prices that we received from National Power reflected the City's perception of the financing of nuclear power. That perception made the indicative prices so high that they were unacceptable the Government. The future prices of nuclear power are at present being discussed with the Nuclear Electric company. I have no doubt that satisfactory arrangements will be made.

What exactly does the Secretary of State mean by "downward pressure on prices"? He knows that the major fuel source of electricity is British Coal and that for the past three years there has been a real reduction in the cost of that coal, with a saving in the current financial year of £850 million on the contract. However, at the same time, by Government diktat during the past two years, there has been an increase in electricity prices of 15 per cent. Given that the new contract with the generator will continue to have the benefit of that cost reduction from British Coal, which will accumulate in the third year to a saving of about £450 million, why will not the Secretary of State tell the House and consumers that electricity prices will go down as a consequence of those massive savings?

I certainly join the hon. Gentleman in paying tribute to the efforts of British Coal and its work force to stabilise the price of coal in recent years and its continued determination to do so. What I mean by downward pressure on prices is that competition in generation, which is responsible for 75 per cent. of all electricity costs, will be a force for reducing prices.

Gas Industry (Competition)


To ask the Secretary of State for Energy what representations have been received about opening up competition in the gas industry.

I have received a number of representations about competition in the gas industry.

Does my right hon. Friend agree that competition is beginning to develop in the gas supply industry, as evidenced by the formation of Quadrant Gas by Shell and Esso which will undoubtedly bring price and other benefits to consumers? Against that background, how does he foresee competition developing along the lines envisaged in the Gas Act 1986?

Like my hon. Friend, I am delighted that new companies are beginning to compete in the market place. They include not only Quadrant Gas but Associated Gas Supplies and Kinetica Ltd. There are good prospects for producers wishing to sell gas directly to the industrial market. The Government's decision that 10 per cent. of all new gas supplies should be sold to customers other than British Gas is promoting competition. As my hon. Friend knows, the power generation sector offers a significant prospect for the early development of competition in the gas market.

Does the Secretary of State agree that an uncontrolled expansion of gas burning for power generation could result in an even greater escape of methane into the atmosphere than occurs at present, and that the escape of methane is an important, if not the most important, contributor to the greenhouse effect?

The hon. Gentleman's latter statement is wrong. CO2 emissions are by far the biggest contributor to the greenhouse effect. However, he is right to make that point. No form of energy generation is without its risks and problems, but gas has substantial advantages over several of its competitors.

Does my right hon. Friend agree that the best way to facilitate competition in the gas industry is to open a trunk pipeline to Europe? Will he do everything possible to bring that about?

At present there is no great demand for that, but there is a considerable improvement in the competitive environment for gas. I should like to see how that develops before taking further steps.

Does the Secretary of State accept that, contrary to his response to my hon. Friend the Member for Pontypridd (Dr. Howells), the latest estimates in the current issue of Nature are that the escape of methane into the atmosphere contributes as much as the burning of fossil fuels in power stations to the greenhouse effect?

Before the right hon. Gentleman authorises any gas burning in electricity generation, should he not get together with the 12 area boards forming the non-fossil purchasing agency, which has just missed the 1 December deadline for 1990? Before he allows the new players in gas to sell gas for electricity generation he should first make sure that the gas board has made its pipelines as gas-tight as they can be, instead of leaking 2 or 3 per cent. of the gas into the atmosphere. Secondly, he should get together with the waste disposal authorities to ensure that landfill gas is used first for conversion into electricity through small turbines. That would make a major contribution to resolving the greenhouse gas problem.

The hon. Gentleman asked several questions, and I am not sure that I accept most of what he said. He asked me to confirm what the hon. Member for Pontypridd (Dr. Howells) said about methane, but he did not repeat what his hon. Friend had said in his question. I stand by what I said.

The full effects of all the different forms of gas emissions are not fully known and that is why the Government are encouraging the panel that is considering those matters. That is why we recently submitted evidence to it, which is available in the Library if the hon. Gentleman wants to see it.

Since privatisation, has the price of gas fallen or risen, and is that any evidence of increased competitiveness?

As my hon. Friend is wise enough to know the answer to his question before he asks it, I confirm that the price of gas has fallen.

Electricity Privatisation


To ask the Secretary of State for Energy if he will make a statement on the implication for coal burn from Scottish mines of the Government's decision to exclude nuclear power stations from their privatisation proposals.

That will depend on commercial decisions to be taken by the South of Scotland electricity board.

Will the Minister be a little more forthcoming about what is happening to coal burn? We now have only one effective Scottish pit and its future depends on securing its outlet to the Longannet power station. Will the hon. Gentleman confirm that an agreement will be concluded soon between the SSEB, or what remains of it, and British Coal to ensure the continued employment of at least one deep mine coal complex in Scotland?

The hon. Gentleman is right that there is a great deal of competition to coal in Scotland. That competition comes not only from nuclear power, to which his question is addressed, but from gas; and the competition from gas will increase.

Recently £70 million has been invested in Longannet. I visited the pit fairly recently and morale is growing, with some reason: the pit is attaining record output per man shift and hitting good seams of coal. There is everything to play for at Longannet. Scotland has a rich diversity of fuel sources and the coal industry must compete against them.

Will the Minister reflect on that answer? He must be well aware that in Scotland we are currently locked in a legal battle in the courts over precisely what the coal burn should be. My hon. Friend the Member for Dunfermline, West (Mr. Douglas) spoke about Longannet, but I have a constituency interest in Monkton Hall colliery. That colliery is mothballed and whether it will be resuscitated depends on the coal burn and on the outcome of the present legal wrangles. Will the Minister be a bit more positive instead of standing back and saying that it is a matter of commercial decisions reached by the people involved? He should say that he will do his best to see that the legal wrangles are resolved so that we know what the coal burn will be in Scotland.

If I followed the hon. Gentleman's advice to see that the legal wrangles were sorted out, he would accuse me of interfering in the courts. The courts are currently sitting and I understand that they will pronounce on the matter soon. We must await their decision. I am sure that the hon. Gentleman would not want me to intervene in the affairs of the courts. If I did he could accuse me of intervening in the judiciary.

United Kingdom Offshore Operators Association


To ask the Secretary of State for Energy when he last met the representative of the United Kingdom Offshore Operators Association; and what matters were discussed.

My right hon. Friend the Secretary of State last met representatives of the United Kingdom Offshore Operators Associations on 8 November, when a number of North sea issues were raised.

Before the Minister next meets the United Kingdom Offshore Operators Association, will he take time to study the evidence given by the Manufacturing Science and Finance union to Lord Cullen's inquiry on Thursday? That evidence identified that at least one offshore operator—Philips in the Hewett field—had agreed with the union to apply offshore the health and safety regulations that apply onshore. Because of the operators' determination to apply those conditions offshore, employees' confidence in the system has increased. When the Minister next meets representatives of UKOOA, will he press the example of Philips on other United Kingdom offshore operators?

I assure the hon. Gentleman that I listen carefully to any evidence relating to safety in the North sea, and MSF and put forward many recommendations. As he will be aware, Lord Cullen is still carefully considering much of he evidence and we await his report, which will be produced some time next year. We shall then look closely at the recommendations.

In his discussions with the United Kingdom Offshore Operators Association, has the matter of steel supplies for gas pipelines arisen? Is the Minister aware that because British Steel's refusal to invest in the plant necessary to produce the quality steel required by the industry, millions of pounds worth of orders are going abroad? Japan is the only country that makes the quality of steel necessary. Will the Minister discuss with UKOOA efforts to encourage British Steel and others? It is not within his ministerial responsibilities, but I know the efforts that his office has made to encourage investment and expenditure in the United Kingdom. Will he take responsibility for this problem and see what can be done about it?

The hon. Gentleman is right; conversations certainly take place between the operators and British Steel about the possibility of obtaining more steel from British Steel. As he is probably aware, Sir Robert Scholey, the chairman of British Steel, is a member of the oil industry advisory board which discusses such matters and was present at the most recent meeting.

Nuclear Industry (Investment)


To ask the Secretary of State for Energy what his proposals are for the future of the nuclear industry investment programme.

The first priority is the successful completion of current programmes, including Sizewell B and the major projects at Sellafield. The question of Nuclear Electric building new nuclear stations will be considered in 1994.

Does the Secretary of State accept that the row over the privatisation of nuclear power has done more harm to the industry than even the Windscale fire of 1957? With the industry under attack on all sides from greens, the coal lobby, the European Parliament, the Irish Dail and a number of nations throughout the world, is it not about time that he made some far more reassuring noises about future investment in these stations?

The Government have made it clear that we have not abandoned nuclear power. We recognise its strategic value in diversity, security of supply and the reduction of fossil fuel emissions. As I said, Sizewell B will be completed to maintain the PWR option. The prospects for nuclear power will be reviewed in 1994. I hope that during the intervening period we can look at some of the costings of nuclear power to see whether we can reduce them.

Is the Secretary of State aware of the considerable dismay in the Welsh counties that faced the prospect of PWR stations at the Government's reluctance to give any compensation towards the costs that they incurred in preparing their cases against those PWR stations, which are now not being built? Will the Secretary of State reconsider the matter to see whether those local authorities can be properly compensated?

In such circumstances it is not normal for the Government to compensate people for, rightly, seeking representation and incurring expense while presenting their case. I should have thought that people to whom the hon. Gentleman referred would be well satisfied with the outcome; I cannot say that I was, but I had to live with those circumstances.

Is my right hon. Friend aware that some European countries have successful private sector nuclear power stations? Is there anything to stop that happening in this country if nuclear power becomes competitive again?

Absolutely nothing. What I said about reviewing the option in 1994 related to Nuclear Electric, which will be a state-owned successor company to the CEGB. That company's prospects will be reviewed again in 1994, but it is perfectly open for anybody who so wishes to make the necessary planning applications if they believe that to be a sensible course of action.

Before Lord Marshall is made a scapegoat for the nuclear fiasco, will my right hon. Friend acknowledge that if his advice to build PWRs had been taken 10 years before it finally was, we should probably have a family of them now producing economic electricity?

I certainly do not intend Lord Marshall to be made a scapegoat for anything. He is a distinguished public servant who served Governments of all types; but, as someone more significant than I has said, "Advisers advise, and Ministers decide."

Is it not a scandal that over the past two or three decades this Government and successive Governments have been kidding the people that nuclear power is cheap, efficient and safe—and cheaper than coal? Now the truth has been blurted out: it is two or three times dearer than coal and other forms of energy. Is it not also disreputable that the Government, who have been conning the British people, should hand over £250,000 to Lord Marshall and accuse him of being a scapegoat? I know a lot of poor people in my constituency who would be happy to be called a scapegoat and handed £250,000.

I understand that the hon. Gentleman must have been pondering his question while I was answering my hon. Friend the Member for Erewash (Mr. Rost) a moment ago, when I said that I did not want anyone to treat Lord Marshall as a scapegoat. I paid him a well-deserved tribute and said that he was a distinguished public servant.

The hon. Gentleman, who takes an interest in some parts of these matters, would be well advised to read carefully some of the evidence given—modesty forbids me to disclose who gave it—to the Select Committee on Energy last week. It was pointed out there that many economic factors in the various forms of energy generation have changed. Oil, gas and coal are much cheaper relative to nuclear power than they were. The hon. Gentleman will be wiser when he has read that evidence.



To ask the Secretary of State for Energy what matters he has discussed with British Nuclear Fuels plc since his recent announcement on the future for nuclear power.

I met Mr. Harding on 16 November when we discussed a range of matters concerning the company.

The answer that my right hon. Friend gave to an earlier question on the future of the nuclear industry will be warmly welcomed by my constituents who work at BNFL's plant at Springfields and who have striven hard to improve their productivity. Can he assure me that in future negotiations with the Nuclear Electric company over the price of nuclear fuel there will be no return to cost-plus negotiating and the consequent loss of the benefits of competitive tendering in this area?

Those are commercial matters for BNFL and the Nuclear Electric company, but I very much share my hon. Friend's view that cost-plus contracts are not the best way forward, and I hope that proper contracts will be negotiated. I have been particularly impressed by BNFL's progress. In 1988–89 Springfields increased its exports by 25 per cent. and contributed to BNFL's record exports of £169 million.

Has the Secretary of State discussed with BNFL or anyone else the fears of a growing number of nuclear engineers and scientists about the inherent dangers of a PWR pressure vessel collapse? Is he aware that an increasing number of our nuclear engineers are so worried about the risks involved that they believe that Sizewell B and the whole PWR programme should be abandoned?

That sounds like a partial account of the position. I have had no discussions with anyone on that subject. Safety is the paramount consideration at all times in the operation of nuclear power. That will continue to be so in the future, and we have an outstandingly good record.

Combined Heat And Power


To ask the Secretary of State for Energy if he will make a statement on plans to expand combined heat and power schemes.

I will continue to encourage wherever possible interest in combined heat and power. Ultimately, decisions are for the private sector.

Will the Minister join me in congratulating Leicester city council and Leicester Energy Ltd. on the pioneering work that they have carried out with combined heat and power? The right hon. Gentleman is aware of the problems that have affected that scheme and will recall the meeting that took place in his office when he was kind enough to show us his collection of clockwork teddy bears. Will he join me in wishing the forthcoming new talks well and hoping for a happy conclusion? Will he give an undertaking that if the talks do not succeed his Department will do all that it can to save this environmentally safe and cost-cutting scheme?

As the hon. Gentleman reminds the House, I was delighted to be able to see him and some of his colleagues from Leicester at the beginning of the summer recess. I hope that I left him with the impression that nobody would have been happier than I if the scheme as it then was could have gone ahead. As he knows, ultimately the negotiations between the East Midlands electricity board and Leicester Energy Ltd. did not come to fruition. If further options come forward I shall certainly do what I can to facilitate them. However, in all fairness to the hon. Gentleman I must make it quite clear that there is no question of any subsidy from the taxpayer.

Should not my right hon. Friend accept, however, that if two thirds of the energy that is presently thrown out of power stations in cooling water were used for district heating in cities, it would not only save huge amounts of fossil fuel but would be environmentally beneficial? Should he not therefore consider giving combined heat and power the same sort of support that he is giving high-cost electricity from nuclear and from renewable sources?

In the main I certainly accept the principle of what my hon. Friend says. I know that he has been a strong supporter of combined heat and power for a long time. Ultimately, the matter comes down to commercial factors. As my hon. Friend may know, in one other city, Nottingham, there is a small district heating scheme. I hope that that example can be repeated on a larger scale in other cities. As he also knows, apart from that scheme there are many combined heat and power examples in other parts of the country. In industry there are 120 and in buildings there are about 300. Therefore, I think that the idea is catching on very well.

Does the Minister agree that the best thing he could do to encourage combined heat and power schemes would be to follow the example of the Secretary of State for Energy and simply announce that the electricity boards would have to allow combined heat and power stations to be base load stations, in the same way as he has announced for nuclear power stations? If that were done, the economics of combined heat and power stations would be immediately transformed and they could produce the cheapest electricity in the system.

The hon. Gentleman puts forward an alluring and very attractive idea which would make a simple solution. However, he will understand that if I agreed with him here and now, I and my right hon. Friend the Secretary of State might find ourselves in great difficulties and my ministerial career would be quickly at an end.

Community Insulation Programme


To ask the Secretary of State for Energy if he will make a statement about the community insulation programme.


To ask the Secretary of State for Energy what action is being taken to assist low-income households with home insulation.

My right hon. Friend announced recently his intention to take powers for a proposed new scheme of insulation grants for low-incomes households.

Is the Minister aware that expenditure on loft insulation and pipe insulation has fallen from £32·6 million to £9·6 million this year? Is he also aware that as a result of Government cuts resources have fallen by 15 to 20 per cent? In view of that, how can he uphold the Government's intention stated in 1983 that Britain would become the most efficient energy-saving nation in Europe by 1990? With only three weeks to go, how can he manage that?

With regard to the hon. Gentleman's first point, the decrease has come about in part because people are not moving house at the rate that they were a year ago. In terms of general efficiency measures, if the hon. Gentleman examines the facts he will realise that the efforts of the Energy Efficiency Office over the years have been very successful. I agree with the hon. Gentleman that there are still significant gains to be made. The nation still spends about £40 billion per year on energy. The current estimate is that we could save up to 20 per cent. of that, which would amount to some £8,000 million. I agree with the general drive of what the hon. Gentleman said.

On a point of order, Mr. Speaker. Will you disallow question No. 24 for oral answer?

No. For many years it has been the practice that questions up to No. 25 can be linked.

Will my right hon. Friend confirm that the new scheme to be introduced will improve access for low-income households, along the lines of the scheme under which 700,000 have been assisted since 1982?

As my hon. Friend said, some 700,000 low-income households have benefited from the old scheme. I expect that when we have worked out the details of the new scheme, considerable numbers—an increase on the present level—will benefit from that scheme as well.

Electricity Privatisation


To ask the Secretary of State for Energy when he expects to announce the new terms and conditions of the obligation to supply subsequent to vesting day under the Electricity Act 1989.

Obligations to supply electricity will rest with those authorised to supply by licence or exemption under sections 5 and 6 of the Electricity Act 1989.

I thank the Minister for that interesting reply, but is it not the case that under the present model of privatisation, which is not the model passed by the House, Britain stands to become the only advanced industrialised country which does not protect the supply of electricity to the consumer? Does this not show utter contempt for British consumers and prove that privatisation is not a means to an end but a discredited end in itself?

The hon. Gentleman has misunderstood the position. The area boards will continue to have an obligation to offer terms for a supply. Every customer will be able to find a supplier, and regulations will continue to prescribe the quality and safety of supplies. Licence conditions on all suppliers will ensure current standards of security.

British Gas


To ask the Secretary of State for Energy when he last met the chairman of British Gas; and what matters were discussed.

My right hon. Friend and I met the chairman of British Gas last month when we discussed a range of issues of mutual interest.

Will the Minister share with us his forecast, or that of the chairman of British Gas, for the future use of gas over the next 10 years in the generation of electrical power?

As the hon. Gentleman has probably heard my right hon. Friend the Secretary of State say, both in this Question Time and on previous occasions, we believe that the generation of electricity by gas will be on the increase in the next decade.

Nuclear Levy


To ask the Secretary of State for Energy what is his latest estimate of the level of the nuclear levy.

The size of the fossil fuel levy will depend on the prices negotiated for nuclear and fossil fuel electricity. These have still to be agreed.

What will be the upper and lower limits of the nuclear levy? How much will that cost the taxpayer and what would be the advantage to the consumer if coal-fired power stations were allowed to compete freely and on the same basis with nuclear power?

The cost of nuclear power is being paid for by the consumer. A fossil fuel levy, or a nuclear levy as the hon. Gentleman refers to it, will not change those arrangements. For the reasons that I gave in my original answer, I am not in a position to quote the amount of fossil fuel levy. However, the decision that I made with regard to nuclear power on 9 November will mean that the fossil fuel levy will be somewhat lower than it would otherwise have been.

Severn Barrage


To ask the Secretary of State for Energy if his Department has any plans to finance the construction of a barrage across the estuary of the River Severn.

Prospects for the Severn barrage project will be reviewed on completion of the financing and organisational studies to be carried out by the Severn tidal power group.

Will the Minister give the House a guarantee that the scheme will not be delayed unnecessarily by his Department? The scheme will generate 7 per cent. of the electricity demand of England and Wales from a renewable source, allow 200,000 man years of employment during construction and create up to 30,000 additional jobs, which will tremendously boost the south Wales economy. It will reduce the effect of the greenhouse problem and it will not create an acid rain problem. Will the Minister give us that guarantee?

I can assure the hon. Gentleman that I agree wholeheartedly with everything that he has said. The financing and the commercial objectives have, however, to be considered. The hon. Gentleman will appreciate that the sums involved in the construction of a barrage of such a magnitude are vast, and that problem is not easily overcome. Financial considerations must be addressed carefully because the cost per kilowatt hour would appear to be of considerable magnitude for the first 30 or 40 years. Subject to that, I wish the project as much of a fair wind as the hon. Gentleman does, subject to environmental and other considerations.

The Arts

North West Arts


To ask the Minister for the Arts what funding North West Arts received in 1989–90.

The overall forecast income for the north-west arts council in 1989–90 is just over £3 million.

That was an excellent answer. My right hon. Friend will be aware at this Christmas time of the joy that can be brought to people through brass band music. I ask my right hon. Friend, on behalf of the Freckleton prize brass band in my constituency, if he will do all in his power to ask North West Arts why it is not as yet giving any help to small village-based community music, such as brass bands? The Freckleton prize brass band is saying to me that my right hon. Friend should ask North West Arts to put some brass back into its band.

I appreciate my hon. Friend's interest in brass bands in the area that he represents. He will know that I do not take decisions in the precise allocation of funding for brass bands or any other arts. It is a matter for North West Arts and, to some extent, for the Arts Council. I hope that my hon. Friend will put his question directly to them.

Does the Minister recognise the serious threat to the provision for the arts in the north-west next year arising from the introduction of poll tax, which will make it extremely difficult for many local authorities to maintain the present level of funding? Will this not place in jeopardy financial provision for the Halle orchestra, the Mechanics arts centre and the Townelet museum and art gallery in Burnley?

I have every conviction that any local authority with a pride in its arts activity will continue to have that pride. It will be directly accountable to ratepayers for whatever support it decides to give. It is interesting to reflect that in Scotland, where the community charge has been operating for several months, the level of local authority support for the arts continues at a reasonable level.

You will remember, Mr. Speaker, visiting the Terrace when seven brass bands played earlier this year, and the men, women and young people who played in those bands remember your visit with pleasure. May I support my hon. Friend the Member for Fylde (Mr. Jack) and at the risk of sounding slightly ethnic, ask my right hon. Friend the Minister for more brass for brass.

I note the enthusiasm for brass bands. I am sure that the various regional arts associations will note the views of the House.

Stolen Treasures


To ask the Minister for the Arts what representations he has had from the Society of Antiquaries about problems of identified stolen art treasures being auctioned in sale rooms abroad; the difficulties of reacquiral of such objects by the churches and other organisations from whom they were stolen; and the need for Her Majesty's Government to satisfy article 7 of the United Nations Educational. Scientific and Cultural Organisation convention, relating to a wide definition of cultural property.

I have received a number of representations from the Society of Antiquaries on this subject.

I am gratified. Would that not make the Government more effective in dealing with future Icklinghams?

I appreciate the importance of the hon. Gentleman's supplementary question about stolen works of art, or alleged stolen works of art, and the Icklingham case of Roman bronzes is foremost in everybody's mind at the moment. I am seeing my hon. Friend the Member for Bury St. Edmunds (Sir E. Griffiths) on this issue tomorrow.

I have thought carefully about the UNESCO convention, but various other avenues are available to us. It is right to say that the Metropolitan police arts and antiques squad has been reconstituted. A computerised data base to index stolen art works is about to be set up. That will take place in January. The trade is already operating two codes of practice. The various procedures are fairly widespread. I remain to be convinced that the UNESCO convention, which is a fairly bureaucractic and cumbersome procedure, is the right way to deal with this difficult problem.

As a fellow of the society, may I ask my right hon. Friend to reconsider this whole issue very carefully? It is a serious matter. As UNESCO is no longer the absolute charade that it was a few years ago, it would help enormously if my right hon. Friend would ratify the convention.

Of course I take my hon. Friend's question seriously, but there is a general point to be made. The whole question of export controls is to be reviewed under the 1992 procedure, and that will apply to works of art and the restitution of works of art. The matter can be considered in that context.

The Minister knows that the measures that he has outlined will not secure the return of the bronzes, which are now in New York. Does he accept that he has responsibility for our heritage and, in particular, those bronzes, which were illegally excavated, illegally exported and, in effect, have been stolen from Mr. Browning, who has a good claim to them?

If the Minister is serious about the matter, will he raise it with the United States Government? Is not that the only way of ensuring that the bronzes are returned to their rightful country, Great Britain?

Of course I am serious about the issue, but, as the hon. Gentleman knows, the police are currently investigating the matter. There has not yet been a court case to prove that the bronzes were stolen. If there is, and if that is the conclusion, further action can be taken.

Departmental Budget


To ask the Minister for the Arts what is the increase in his Department's budget for the coming three years.

Between 1989–90 and 1992–93 my Department's budget will increase by 24 per cent.

I thank my right hon. Friend for that welcome reply. What is in his budget for an improved programme of building and maintenance for our national galleries and museums?

I am grateful to my hon. Friend because one of the most important parts of my recent decision to increase the three-year funding is to put added focus on improving the fabric of our national museums and galleries to ensure that they are in good shape during the 1990s. It is a campaign of unprecedented importance and I have earmarked £180 million over the next three years to that effect.

In this the 150th year of photography, do not the Government stand condemned for doing precious little about such a major and important historical event? Will the Minister ensure that some cash from that 24 per cent. rise in his budget goes into photography so that young photographers and galleries can do something for themselves, because the Government, typically, are doing nothing for them?

I am surprised at the hon. Gentleman's question. He knows that the science museum in Bradford has an extension housing the national museum of photography, film and television. It is a major centre of great importance to the whole of the country. I am surprised that the hon. Gentleman should suggest that there is little support for photography. This evening I am going to the royal academy to view a major exhibition of photography. There is a great deal of support for photography throughout the country.

British Library


To ask the Minister for the Arts when the British library project is expected to be completed.

The complete building will be operational by 1996, although the first main phase will be opened in 1993.

Does my right hon. Friend agree that this major and exciting project underlines the Government's commitment to the arts in all their forms? Will he take this opportunity to confirm that the British museum reading room will remain open?

I can assure my hon. Friend that the round reading room, which is of historic importance, will be kept open under the overall responsibility of the British museum after the British library has moved to the new St. Pancras building. On my hon. Friend's first question, which is of great importance, the new British library is the Government's biggest civil construction today and the biggest cultural construction of the century. There could be no better evidence of the Government's commitment to the arts and the library world than this major new centre of excellence. It will provide remarkably improved services to the reader, in much better environmental conditions, and it will all be located in one building instead of the present 18.

North West Arts


To ask the Minister for the Arts when he last met a representative of North West Arts; and what matters were discussed.

I met the chairman of North West Arts in his other capacity as chairman of the Council of Regional Arts Associations on 25 July this year when various matters were discussed.

Among the matters that were discussed, did the Minister talk about the allocation for the education budget that North West Arts would be allowing this time? It appears that money for education connected with the arts is being cut, and North West Arts is concerned about that. It means that children in school will not receive what they have been receiving in the past.

It is for North West Arts to decide how much work it does in that area. My right hon. Friend the Secretary of State for Education and Science and I are carrying out a joint study on best practice in terms of the relationship between schools and artistic activities through theatres, museums, galleries, and so on. My right hon. Friend and I attach great importance to that and hope that it will lead to enhanced arts activity in the schools.

Does my right hon. Friend believe that North West Arts has sufficient funds to fund the "In your own words" project, about which I have written to him and which has achieved a great deal of international recognition?

It must be for North West Arts to give a direct answer to my hon. Friend. However, I have no doubt of the importance of this and I look forward to meeting him to discuss the matter.

Civil Service

Disciplinary Action


To ask the Minister for the Civil Service if he will specify the particular guidelines, pursuant to Official Report, 27 November, column 436, which apply to action being taken against senior civil servants who authorise the disclosure of Law Officers' advice to the Government.

Such a situation would be covered by the general guidelines in the Civil Service pay and conditions of service code, a copy of which is available in the Library of the House.

Had they not been engaged in protecting their Prime Minister from being found out by the House, would not Mr. Ingham and Mr. Powell have been liable to the same kind of criminal charges which, for a lesser offence, Clive Ponting faced? Once persons, however eminent, get away with these bad habits, as with Rover and the way in which the Prime Minister got rid of the Chancellor of the Exchequer, do they not do the same thing again in relation to the House which, were I so indelicate as to mention it, would mean that I would be suspended until Christmas?

I am sorry that the hon. Gentleman did not go into more detail. We have been over this time and again. I have explained to the hon. Gentleman that there are detailed guidelines and he has no doubt referred to the copy that is available in the Library. On Westland, the matter has been debated on many occasions and I have nothing further to add.

Does the Minister believe that European Commissioner Sir Leon Brittan was right when he said that Messrs Ingham and Powell improperly disclosed a Law Officer's report? If the Minister believes that, why are those two people in a completely different category from anyone else in the Civil Service? The Minister at least owes civil servants an answer to that question.

As I have already said, and am delighted to say again, I have nothing further to add in relation to that case other than to say that Mr. Ingham and Mr. Powell are outstanding civil servants.

Central Policy Unit


To ask the Minister for the Civil Service what guidance is issued to senior civil servants at attendance of meetings of the central policy unit.

Guidance on the circumstances in which civil servants may attend or participate in activities organised by outside bodies is set out in the personnel management handbook, copies of which are available in the Library of the House.

Is the Minister aware that, according to recent press reports, civil servants have been attending committees of the Centre for Policy Studies, a body established by Sir Keith Joseph and the Prime Minister a few years ago? Will he confirm that civil servants are at liberty to attend briefing committees of bodies that are associated with political parties?

Clear guidelines are set down as to what civil servants can and cannot do. One key criterion is whether or not a particular organisation is part of a party political organisation. That is not the case in respect of the Centre for Policy Studies. Clear guidelines lay down that if civil servants attend meetings they must show impartiality, observe the confidences of Government, and show discretion in respect of any controversial issues.

I congratulate my right hon. Friend on his contribution to the White Paper on the financing and accountability of next steps agencies. It is a great step forward in the programme for setting up agencies within Government.

I am grateful to my hon. Friend for his remarks. My right hon. Friend the Chancellor of the Exchequer announced in the White Paper a new trading funds Bill, which will allow many of the newly constructed agencies of Government to operate within more commercial disciplines. That is good both for management and for the best use of Government resources.

Does the Minister agree that this country has a long and honourable tradition of civil servants, including senior civil servants, being divorced from party politics? Is it not unfortunate that a number of civil servants, certainly those based at No. 10—Mr. Ingham and Mr. Powell immediately come to mind—are very much associated in the minds of right hon. and hon. Members and in the minds of the public with a Conservative Government?

I am surprised at the hon. Gentleman's question. He knows as well as I do that the Civil Service demontrates the highest standards of impartiality. There is no shadow of doubt about that. It has demonstrated that impartiality under Labour Governments as well as under the present Government.

Museums (Opening Hours)


To ask the Minister for the Civil Service what discussions he has had with the Civil Service unions about museum opening hours.

I have had no discussions with Civil Service unions about museum opening hours. This is a matter for the directors and trustees of the national museums and galleries.

Does my right hon. Friend agree that we should encourage families to visit museums and galleries, but that all too often they are closed in the early evening, at weekends and on bank holidays, which are the very times when families could visit them? Will my right hon. Friend encourage the Civil Service unions to play their part in making possible an extension of opening hours?

I am impressed by the more flexible opening hours that museums now operate. Recently, the Victoria and Albert museum, for example, reintroduced Friday opening as a result of voluntary donations. The natural history museum has extended its Sunday opening hours, closing at 6 pm instead of 1 pm, and the imperial war museum is open daily from 10 am to 6 pm. That all demonstrates greater flexibility and concern for the public interest.

I associate myself with the question asked by the hon. Member for Battersea (Mr. Bowis). Clearly one wants to encourage higher museum attendances through more flexible hours, but would not another way of doing that be to drop all admission charges, whether voluntary or mandatory. because they become a tax on knowledge?

I am interested that the hon. Gentleman should involve himself in the question of museum attendances, because this year will see higher attendances at British museums than ever before in our history. A total of 100 million people will have visited our museums, compared with 68 million four years ago. The degree of support for, and attendance at, museums is at an unprecedented level.

Does my right hon. Friend agree that if a private sector organisation were to carry the value of stock that is carried by the average museum, it would have to remain open all the hours that God sends, and certainly at times most convenient to the public?

My hon. Friend is right, but his remarks stray a little from the subject of the Civil Service. Museums and galleries have a large reserve of works of art, but there is more and more evidence that they lend them out to other institutions. I am doing all that I can to encourage that process.

Trade Unions


To ask the Minister for the Civil Service when he next intends to hold discussions with representatives of Civil Service trade unions; and if he will make a statement.

I meet representatives of the Civil Service trade unions from time to time. A wide variety of matters are raised.

Notwithstanding all the Government's recent attacks on the pay of various sections of the working class, especially the ambulance crews, will the Minister confirm to the Civil Service unions that the Government do not have a pay policy? They were elected not to have one in 1979. As the Government's official policy on devaluation is rapidly taking place—there has been a 13 per cent. reduction in the past 12 months, which probably equates to a three percentage point increase on the inflation index—will the Minister tell those unions that their pay should be increased by at least that amount, on top of the 13 per cent?

I am surprised that the hon. Gentleman does not realise that Civil Service pay and the pay of specific groups, such as the ambulance men is the responsibility of individual Departments or for my right hon. Friend the Chancellor of the Exchequer to decide. I am startled that the hon. Gentleman prefaced his question by talking in class terms. Nothing is more divisive than considering public issues in terms of class and nothing could be more neolithic than the hon. Gentleman's attitude.

Civil Servants (Morale)


To ask the Minister for the Civil Service if he will make a statement on measures taken to ensure the safety and maintain the morale of civil servants at risk from terrorist activity.

There are a number of precautions in place to protect civil servants against the risk of terrorist attack. Other contingency measures are ready to be implemented if needed. It would not be in the public interest to reveal individual measures.

Does the Minister accept that Government buildings other than those of the Ministry of Defence, need protection against terrorist attacks? What will he do to reassure civil servants who work in those buildings that the Government are concerned for their safety?

The hon. Gentleman is right. The first concern of Ministers must be the safety of their civil servants. I can assure the hon. Gentleman that all the necessary steps are being taken to maintain a proper level of security, whether protection is provided by civil servants or by other agencies.

Storm Damage

3.31 pm

(by private notice): To ask the Secretary of State for the Environment if he will make a statement on the storms over the weekend and on what plans he has to assist with any damage caused.

I am grateful to my hon. Friend for giving me the opportunity to report to the House about the violent storms that hit many coastal areas of the British Isles over the past weekend.

Tragically, it has been reported that eight people lost their lives, and I am sure that the whole House will wish to join me in expressing heartfelt condolences to the relatives and friends of those who lost their lives. I also extend my sympathy to those who have suffered damage to property or have been hurt.

It is apparent that the storms were severe and caused widespread damage, particularly in coastal areas. Obviously it is too soon to assess exactly how much damage has been done, the amount of work necessary and how much it will cost to put it right.

I am grateful to all the emergency and voluntary services who took part, often at great personal risk. The primary responsibility for dealing with emergencies lies with local authorities. They have wide discretionary powers to spend money for such purposes under section 138 of the Local Government Act 1972, and they normally include an amount in their budgets to meet such contingencies. They also have the necessary local knowledge, resources and expertise to deal with such emergencies.

My hon. Friend asked whether the Government will bring additional national taxpayers' money to assist with the costs of dealing with the results of the storm. Under a model scheme designed to deal with the extraordinary costs arising from emergencies, known as the Bellwin scheme, my right hon. Friend the Secretary of State provides special financial assistance to local authorities in certain exceptional circumstances. These are, in an emergency or disaster involving destruction of or danger to life or property; where, as a result, a local authority incurs expenditure on taking immediate action to safeguard life or property, or to prevent suffering or severe inconvenience in its area; or where those costs are not normally insurable.

The scheme has been used twice in England recently, following emergencies created by the severe weather during the winter of 1986–87 and the great storm of 1987, and once in Wales in 1987, following floods. We cannot yet tell whether the immediate emergency works necessary to deal with the aftermath of the storm will justify activating the scheme, but I have asked my officials to liaise with the local authorities whose areas have been worst affected to enable a judgment to be made as soon as possible. My right hon. Friend the Secretary of State for Wales will be in touch with local authorities about arrangements there.

I thank my hon. Friend for his comprehensive reply and join him in thanking all the emergency services and local authorities in my area who acted so promptly in response to the flooding during the weekend. I am told that Preseli-Pembrokeshire district council dealt magnificently with the floods at Newgale, which were shown on national television, and in which, as far as can be ascertained, we lost a police car. I must also praise the Royal Air Force at Brawdy, which airlifted people out of the Dale peninsula when they were in danger of being drowned. I am sure that the whole House joins the Minister and me in thanking those services for what they have done.

I represent a constituency with a long coast, so we have particular problems. Will specific help be given to coastal authorities in view of the severe damage that has been done? Will he consider assisting local authorities, if severe strain is put on their resources, by giving them extra help over and above that provided through the Bellwin formula?

I am grateful for my hon. Friend's kind words about the emergency services and all those who pulled together to improve matters in his area. Coastal protection is the responsibility of my right hon. Friend the Minister for Agriculture, Fisheries and Food. My right hon. Friend the Secretary of State for the Environment will examine any submissions from local authorities under the Bellwin formula.

May I first offer my deepest sympathies to the families of the men who were lost in the firth of Clyde? Skipper Billy Irving was a fine professional fisherman and a member of the Clyde Fishing Association, of which I have the honour to be an honorary president. As Skipper Irving was going about his hazardous business when his vessel, the Destiny, foundered just a couple of hundred yards from Gourock, can the Minister, who is not responsible for these matters, convey to the Minister of State, Scottish Office, who I am pleased to see on the Treasury Bench, the need for a fatal accident inquiry? Can he also convey to Scottish Office Ministers our anxieties about this loss?

On behalf of Cornish fishermen, I join those who have expressed their condolences, especially as we lost two of our fishermen just a few weeks ago. As my constituency—the Isles of Scilly and along the arc of Mount's bay—bore the brunt of the storm during the weekend, will my hon. Friend the Minister convey to the Ministry of Agriculture, Fisheries and Food the urgent need to review coastal protection measures, especially in the Porthleven area which, as the whole nation saw on television last night, was especially badly hit by the storm? There is a need for an extension of coastal protection works and possibly a review of their extent. Will my hon. Friend kindly convey that message to the Minister of Agriculture, Fisheries and Food? No doubt I shall be knocking on his door very soon with local authorities.

Hon. Members are not the only people who are familiar with that part of the country. I am sure that my hon. Friend's constituents will find solace in my right hon. Friend the Minister of Agriculture, Fisheries and Food.

I also join in sending our condolences to the families of those whose lives were lost. We congratulate on their courage and heroism the emergency and voluntary services, not least in Cornwall and the Isle of Scilly which, as the hon. Member for St.

Ives (Mr. Harris) said, bore much of the brunt of the storms. In past occurrences, local authorities have encountered problems with getting funds through quickly enough to tackle the problems, particularly given their current financial constraints. Although I accept what the Minister said about the formula, and that it is not yet possible to ascertain whether it will come into play, will he ensure that everything is done to ensure that any funds that are needed are brought into action as quickly as possible with as few bureaucratic problems as possible?

I am happy to give the hon. Member that assurance. It is important that local authorities act now to repair the damage, without waiting for any bureaucratic procedures.

Will my hon. Friend ensure that central Government make a speedy decision about what help is available, because delay adds to the uncertainties and difficulties of local authorities that are faced with the immense bill for capital works for coastal defences?

I am grateful to my hon. Friend. We will ensure that action is taken as quickly as possible.

May I associate myself with the condolences that have been expressed, and voice my concern about the speed with which the Bellwin scheme is operated? When there was gale damage in the south of England some time ago, when we were in recess, the emergency was handled within five days, but when there was gale damage in Scotland, it was 13 weeks before the Bellwin scheme was applied. Local authorities have not applied the Bellwin scheme to many other cases which it should have covered. I am concerned that it should be applied to this case. The Minister said that the scheme covers amounts that are "not normally insurable". Is that traditionally part of the Bellwin scheme, or has it been added to it?

That has always been part of the Bellwin scheme. On the last occasion, there was a five-day gap before my right hon. Friend the Secretary of State was able to report to the House. This time, the delay has been between 24 and 36 hours. The hon. Gentleman will understand that that is why we are not able to say at this stage whether the Bellwin scheme will apply.

As the sea level is rising because of the greenhouse effect, while the Minister is working out his criteria for local authorities under the new community charge, will he give special grant to those areas with coastlines of more than so many miles? My constituency has 88 miles of coastline. Does he agree that some factor should be included in the formula so that, when such a catastrophe occurs, local authorities already have a fund which they can make available to repair any damage which occurs? For example, at Hope cove, a wall was completely destroyed, and at Blackpool sands an entire beach has disappeared.

I am pleased to be able to tell my hon. Friend that emergency capital and reconstruction works can be undertaken by local authorities and the National Rivers Authority and considered for grant by the Ministry of Agriculture, Fisheries and Food if they meet the normal criteria, even if there is no prior approval.

Is my hon. Friend aware that part of Lymington in my constituency was very seriously flooded, to a depth of 5 ft? Is he further aware that, thanks to the New Forest district council setting up a control post at 3.30 am on Sunday, and thanks to the tireless efforts of the police, the fire brigade and the social services, many of the problems have been resolved? Is he further aware that Hurst spit, which provides protection not only to my constituency but to all those along the Solent, has been breached in a number of places? Can he confirm that the compensation to which he referred earlier will cover that, should the district council require financial assistance?

I cannot decide at this stage whether any particular item of damage would be counted for compensation, but I shall certainly take my hon. Friend's point into account.

Order. I propose to give precedence to those hon. Members whose constituencies have been directly affected.

Will my hon. Friend confirm that any funds allocated will be extra money and will not affect sanctions on local government expenditure when it is reckoned at the end of any particular financial year?

If additional money is payable under the Bellwin scheme, it will be in addition to the normal rate support grant.

Will my hon. Friend be making a statement before the House rises for the Christmas recess so that local authorities know what their financial position will be? Clearly, the decisions that they must take about what can be afforded will be related to whether the Bellwin formula will be operative.

I hope that local authorities, which budget to deal with such emergencies, will not be inhibited in making the expenditure necessary to put right the damage. We shall take a decision as quickly as possible about whether the Bellwin formula should apply. The ball is in the local authorities' court, because it is for them to make the necessary application.

Why is it that one Department cannot pay local authorities, which have lost millions of pounds over the past 10 years as a result of the Government's actions, some money to help them out when there has been a disaster, because the Minister says "It is a complicated formula which will take a long time to work out," but when the Department of Energy has to find £250,000 to pay Lord Marshall a tidy sum for kidding the people—

Why do the Government have double standards—one for local authorities and another for people such as Lord Marshall?

I am afraid that it is typical of the hon. Gentleman that he should wish to bring party politics into this tragedy.

The homes of quite a number of families in Holywood in my constituency were flooded at the weekend. Extensive damage was done to homes, furnishings and personal belongings. Insurance companies will not provide rapid or adequate payment. I therefore appeal to the Government to help to mitigate the emergency in the area by ensuring that prompt compensation is made to help them until insurance companies pay out.

It is clear from the comments of hon. Members that speed of action is all-important in this case.

While we do not have a seaboard in Newham—or we certainly did not have this morning when I left it—we in the inner city are concerned about the risks that people who supply us with our fish must run. At times such as this, they and their hazardous jobs are high in our minds. It was good of the Minister to praise the emergency services.

As Ministers regularly do so on occasions such as this, would it not be better to pay the emergency services, such as the ambulance workers, the money that they deserve? Will the Minister say whether all the local authorities in the south-east and in London have been fully compensated for the storm damage that he mentioned of October 1987? Certainly in the south-east, there is still much evidence of the damage that occurred on that day.

So far as I am aware, all the claims made under the Bellwin scheme for the 1987 storm have been settled. We all praise the emergency services, but it is important to remember that many people work in these circumstances for nothing—particularly, for example, those who work for the Royal National Lifeboat Institution.

The whole House will unreservedly agree with the Minister's remarks about compassion for those who lost their lives and for their families; that goes without saying for every hon. Member. We should like to know whether the Government will discuss with insurance companies what they think is a fair assessment for people who are not covered by insurance, including local authorities. That is important, because not all risks are insurable. It falls on the Government to consult insurance companies as well as local authorities.

We are worried about charities. Hon. Members have commented on the important work of the voluntary sector. Will the Government be prepared to recognise its contribution by considering grants for it where it has cost extra money to involve itself in rescue services?

Will he take this opportunity to congratulate the emergency services—including, specifically, the ambulance service, which at times has not been given the support of management that it deserves? Now is an opportunity for the Minister to associate himself fully with the work done by the ambulance service, despite the current industrial dispute.

My final point is of immense importance—I believe that this is the first occasion when such an issue has been before the House when Conservative Member after Conservative Member has asked for extra money for the local authorities. Most Conservative Members, especially the hon. Member for Pembroke (Mr. Bennett), have spent most of their political careers working out ways in which they can cut, undermine and demoralise the power and resources of the local authorities, yet as soon as there is a bit of trouble in their constituencies, they all want the local authorities to solve it.

One answer that I did not hear the Minister give, and which I should like him to give, is in response to his hon. Friend the Member for Portsmouth, South (Mr. Martin) who put his finger on it when he asked, "If the local authorities get any money, will they later lose it?" I want a clear commitment from the Minister now that extra money will be available, not that it may be available. We understand that he cannot say how much, but we need to know that it will be available and that it will not later be taken back, as the Government have consistently taken back such money over the past 10 years, emergency or no emergency.

It is a pity that the hon. Gentleman should try to make party political points on this occasion. It is common right across the House that we pay tribute to the work of the emergency services, whether the fire service, the ambulance service, the police or the voluntary organisations such as the Royal National Lifeboat Institution. We genuinely appreciate their work. This Government give generous grants to the voluntary sector. We have recently announced some generous arrangements for rate relief for charities' premises. I hope that local authorities will exercise their discretion to make that relief even more generous. The Government have a good record of commitment to the voluntary services.

I can assure the hon. Gentleman that, if any money is paid to local authorities under the Bellwin scheme, that money will belong to the local authorities and will certainly not be taken back by the Government. There would be no purpose in that. However, no decision has yet been taken on whether the Bellwin scheme applies in this case. We shall have to wait to see the submissions from the local authorities. I hope that they will bring them forward as soon as possible.

Local Government Finance (Wales)

3.51 pm

With permission, Mr. Speaker, I should like to make a statement on local government finance in Wales. I have already made it clear that, in order to assist local authorities in Wales, I would announce the 1990–91 grant settlement before Christmas. I propose to lay the reports for 1990–91 on Wednesday; but I am today placing in the Library a paper detailing my settlement decisions. I will be sending copies of the reports and of further technical data to all Welsh local authorities on Wednesday.

In summary, the settlement provides for a realistic level of total standard spending of £2,114·5 million, well up on the equivalent figure for 1989–90. Aggregate external finance at £1,738·5 million is increased by no less than 8·6 per cent. Within this, and as compared with my provisional estimates in November, revenue support grant has been increased by a further £10·4 million to £1,141·3 million, and the distributable amount from the non-domestic rating account has been reduced by the same amount to £443 million.

This is an excellent settlement. It is good for non-domestic ratepayers because a uniform poundage of 36·8p across Wales will provide the certainty and stability they have been seeking and because their contribution of £443 million, which is only 20 per cent. of local government spending, is over £10 million lower than I predicted in November.

It is good for community charge payers because it presents local authorities with an outstanding opportunity to keep community charges down. They know, and their electorate will know, that the burden of overspending is borne entirely by charge payers. This will bring realism to the local authority budgeting process.

The increase in total standard spending should allow authorities to maintain, and where appropriate to develop, services—particularly if councils achieve the efficiency savings which the Audit Commission has identified and which, commendably, they have been seeking.

There is no reason for local authorities to budget to exceed total standard spending, and no reason for the average community charge in Wales to be more than £173. This is the true measure of the excellence of this settlement for the Principality.

Charge payers will expect their councils to set their community charges in line with this settlement. They will very quickly appreciate that expenditure increases which exceed this will result in higher charges, and will wish to satisfy themselves that they are not being asked to pay the price of overspending and inefficiency. It will be for councils, particularly those whose spending exceeds their standard spending assessment and who set higher charges, to justify their decisions to their electorate.

Similarly, charge payers will not expect those councils whose spending falls below their standard spending assessment to increase their spending by more than I have allowed for if they are already efficiently providing an appropriate level of service.

I intend to introduce a scheme of community charge transitional relief, carefully tailored to reflect Welsh circumstances. For 1990–91, I am providing £20 million in grant to fund this scheme; resources will also be made available for the following two years. This scheme replaces and improves upon the safety net that I proposed in July. It is carefully targeted and cost-effective. I have placed in the Library provisional details of the communities which may receive additional grant. The scheme is fully funded by the Government and an area safety net will not be required. This additional grant will reduce the average community charge which should be payable in Wales to about £165.

In addition, community charge rebates will be available for those on low incomes, and I urge all charge payers who may be eligible for a rebate to apply for one to their local councils. Those on the lowest incomes in Wales will actually be better off with the community charge than if they had received a 100 per cent. rebate under the old rating system.

Under this excellent settlement, central Government and non-domestic ratepayers will together finance around 85 per cent. of local government revenue expenditure in the Principality. It follows that only 15 per cent. of local government expenditure will be met by charge payers. In the light of this, charge payers have every right to expect their local councils to protect their interests by budgeting sensibly, by containing their spending to affordable levels and by keeping the community charge low.

I must tell the Secretary of State that, based on the provisional figures announced at the end of November, Mr. Gwyn Davies, the chairman of the Welsh Association of District Councils and Mr. Fred Kingdom, chairman of the Welsh Counties Committee, are of the view that, to cover costs for next year, some 3 to 4 per cent. more money is needed. Is he aware that, when poll tax demands fall through letter boxes in a few months' time, people in Wales will wonder why the amount is so much higher than the £173 that he has widely publicised? The Secretary of State will try to put the blame on local councils but the buck starts, and it stops, with him and his statement today.

Does the Secretary of State not realise that the statement borders on a confidence trick? It is not an excellent statement: it is deplorable. It will destabilise rather than stabilise. There is no room for efficiency savings after 10 years of Conservative Government. Therefore, will he concede that the statement is some 3 to 4 per cent. short; that the standard poll tax will be not £173 but £210 per year; that 2 million poll tax payers in Wales will pay £30 to £40 extra per person than he says; that the valleys communities will be hit very hard; that expenditure provision is £80 million short of what councils say they need to spend, and that the revenue support grant is £40 million short? The statement ignores persistent high inflation, high interest rates, and salary and wage increases of 9 per cent. which must be funded. The Secretary of State has not found the money to do so.

Does the Secretary of State understand that, if local councils in Wales spend, on average, 4 per cent. more than the provisional allocation, the poll tax charge for two-adult families—according to the district councils, not the Opposition—might increase by 50 per cent. in Dinefwr, Llanelli, Pwllelli, Islwyn, Arfon, Merionnydd and Rhymney Valley; by 66 per cent. in Merthyr Tydfil, Lliw Valley and Neath; by 75 per cent. in Port Talbot; by 90 per cent. in Blaenau Gwent and Cynon Valley; and by 123 per cent. in the Rhondda. What have the valleys communities done to deserve such a system? This is supposed to be the season of good will, but today the Secretary of State for Wales is implementing a deeply unpopular measure. He should know that Wales hates the whole concept of the poll tax.

Does not the right hon. Gentleman agree that the people who will benefit from the poll tax settlement will be those who occupy large, high-rateable-value houses? Has he forgotten that the transitional relief will be phased out over three years, just after the next general election? What a coincidence. I remind the right hon. Gentleman that this statement will not help district councils to increase the number of environmental health officers and their back-up technical staff in a year when Wales has suffered serious outbreaks of listeria and salmonella. Yet again, he leaves our councils short in that sphere.

How can local councils step up their excellent work to encourage new industries if, as a result of the statement, they will be short of the means to create new jobs? How can our councils build new homes when they estimate that their spending will be 13 per cent. down on their current expenditure? The Government have enforced the sale of 72,000 council houses in Wales, but they have not given the councils the means to build new council homes.

Has not the right hon. Gentleman wrapped the poll tax round the necks of the Welsh people? Surely the poll tax in Wales in a Tory tax. It is the Secretary of State's tax, as he has given the poll tax to the people of Wales. Does he understand that, when the general election comes, there will be nobody behind him in support?

The hon. Member for Alyn and Deeside (Mr. Jones) has come out with a long statement, most of it totally inaccurate. Without exception, all the percentages he quoted are inaccurate. Let us get one percentage absolutely correct—the one for his constituency. There, on average, the community charge will be 15 per cent. below the average domestic rate charged in the past. Perhaps the hon. Gentleman would like to convey to his constituents the adverse effects of the settlement.

It is nonsense to say that a settlement which is 7–1 per cent. above the budgets of the local authorities for the previous year is a scandalous cut in local government expenditure. If the hon. Gentleman wants to adopt a system under which there were scandalous cuts, he will have to go back to the time when he was a Minister at the Welsh Office. In his final three years at the Welsh Office, there was a cut in real terms in the rate support grant every year. I am glad to say that, in the past four years, there has been no cut in real terms in the rate support grant.

The hon. Gentleman also said that, after 10 years of Conservative Government, there was no room for any improvements in local government efficiency. That is one of the classic quotes from an Opposition Front-Bench spokesman. The Audit Commission recently had meetings with the local authorities, which agreed that a host of improvements could be made in efficiency. It is deplorable that, given his responsibilities, the hon. Gentleman should suggest that local authorities in Wales should not look for further improvements.

I am delighted to say that one of the results of new business rate is that the valleys will pay £11 million less in business rates than under the present system. That is very much to their advantage, and the scheme I have announced this afternoon contains additional great advantages for those valleys. Opposition Members always cite the terrible low incomes of those in the valleys. In the Rhondda, the substantial number of people who have been receiving 100 per cent. rebates under the rate rebate scheme will receive 130 per cent. rebates under the new scheme.

I assure my right hon. Friend that I shall be here to support him after the next general election. However, even his legendary skill at extracting blood from the Treasury's stony heart—which has brought such great benefits to Wales generally and ensured that the levels of poll tax in Wales will be appreciably lower than in the United Kingdom as a whole—cannot make sense of this nonsensical system for financing local government. Can it be right that a local authority such as Rhuddlan in my constituency, which has managed its affairs with skill and prudence, should find that its grant has been cut by £750,000·20 per cent. on its last year's grant? This will oblige it to increase the poll tax by 50 per cent. Does not that show that, despite my right hon. Friend's efforts to modify the effect on Wales, the system is preposterous and those who denounced it from the start were absolutely right?

I think that my hon. Friend will discover that, when local authorities study the figures and my announcement this afternoon, they will find that the figures he has given are not accurate. Instead of the average rates in Rhuddlan being £201 per adult, as they were under the rating system, they will be £199. As a result of the new system, in the other part of his constituency, the district of Colwyn—a place which has many retired people —there will be rate reductions of about 17 per cent.

I am sure that the House is grateful to the Secretary of State for telling us how prosperous local government is in Wales. In that context, will he explain why each of us in rural areas meets weekly ever-increasing queues of young people who can no longer find housing in their own area? Will he explain why unmarried mothers with children whom they are looking after increasingly have to go into unsuitable halfway house accommodation where they cannot look after their children properly? Will he explain why, in the context of the prosperity of which he boasts, local authorities can no longer meet those priority housing needs?

The hon. and learned Gentleman knows full well that we have substantially increased expenditure on Housing for Wales, which, in turn, is substantially increasing its grant to housing associations throughout the community—that is having a considerable impact. Under the settlement, we have ensured that, under the new statutory arrangements, there will be a substantial increase in expenditure on improvement grants and the backlog of improvement grants, which are important in many rural areas.

Although I appreciate that my right hon. Friend has fought an effective and successful fight to gain a reasonable settlement for Wales as a whole, he will appreciate that I share the concern of my hon. Friend the Member for Clwyd, North-West (Sir A. Meyer) because together we represent the borough of Rhuddlan in this House. Is my right hon. Friend also aware of the concern in the borough of Delyn where the settlement appears to have been penalised because of the way in which it finances expenditure on industrial development?

The system that is operated in local authorities has operated for several years. It was discussed with local authority associations as to whether any change should be made, and the associations agreed that the existing system was the right one to keep. Therefore, Delyn's financing process was one that it used knowing what the past rules were and the fact that the local authority associations did not want any change in those rules.

Will the Secretary of State recognise, as he did a while ago, that our Welsh local authorities are not inefficient, but have a splendid record? Will he also recognise that the unrealistic poll tax figures which he has put out are seen by all local authorities for what they are: simply a red herring to disguise the full implications of what will undoubtedly be an unpopular policy?

The hon. Gentleman says that an increase of 7·1 per cent. on the budgets of the local authorities for last year is a red herring. However, it is a perfectly accurate assessment with which, due to the improvements in efficiency which have taken place, the Welsh authorities can certainly cope. I am delighted that in Newport the likely reduction, compared with the rating system, will be about 14 per cent. per adult.

We have not yet heard what scheme of local government finance the Opposition intend to bring in. They announced one scheme and abandoned it due to its unpopularity. Presumably, given reductions like those in Newport and Cardiff, they will not go back to the rating system. The people of Wales need to know soon exactly what the Labour party will do about local government finance.

I congratulate my right hon. friend on his statement and advise him not to shout too loudly in this House about his achievements, in case our English colleagues hear exactly what the people of Wales have managed to achieve. Is it not true that in Wales 67 per cent—two thirds—of all local government expenditure comes from central Government, whereas the comparable figure in Scotland is 56 per cent. and in England only 46 per cent.? That is an excellent achievement.

Can my right hon. Friend confirm that my ratepayers, who now number 50 per cent. of the electorate, will be pleased to find that in future everyone who has a vote in local elections will make some contribution to the services that they enjoy?

Certainly the average community charge in Wales will be £100 per person lower than in England or Scotland. The people of Wales should rejoice about that; it is something that I find it difficult to explain to my constituents in Worcester.

Has not the Secretary of State been proved wrong yet again? Does he recollect how dismissive he was in November when he forecast a figure of £173 and I forecast one of £200? He regarded my figure as scaremongering.

The Secretary of State said that the burden of overspending would be borne entirely by the chargepayer, but is it not equally true that the burden of under-provision will also be borne entirely by the charge payer if the gap is offset by cuts? As the figure that the right hon. Gentleman announced today—of 7 per cent.—is lower than inflation, has he not announced a formula that will mean savage cuts in Wales in the next 12 months?

In November I gave a figure of £174; I now give it as £173, which, with the rebate scheme that I have announced, will come to £165.

If the inflation rate for this year proves to be above 7·1 per cent. and if there is no improvement in efficiency, it could be argued that local authorities and charge payers will be squeezed, but that will be as nothing compared with the 8 per cent. drop in real terms that took place when the right hon. Gentleman was a Minister at the Welsh Office.

Is the right hon. Gentleman aware that, despite what he has said today, the valley communities, of which Neath is one, will be especially hard hit? Is he aware that we prefer to accept what we are told by local government officials–that there will be a 3 to 4 per cent. shortfall? Is he further aware that, in a two-adult household in Neath, there will be an increase of 66 per cent. as a result of the poll tax? How does he think that we will be able to afford to pay for roads, environmental protection, schools and the promotion of jobs? Is not this testimony to what the valleys initiative has been all about?

The hon. Gentleman's figure of 66 per cent. for Neath is not correct. With the interim relief, it will be much lower than he has suggested.

My answer on spending in the hon. Gentleman's constituency is: it depends. If he is arguing that will be a 3 or 4 per cent. gap, he is saying that we should be giving Neath an 11·1 per cent. increase on last year's budget—

If that is what is required in the hon. Gentleman's view, the people of Neath will have to see what it means and compare it with the present system, under which 85 per cent. of all local government expenditure in Wales is met either by the business community or by the Government. In no other part of the United Kingdom is only 15 per cent. of it met by the charge payers.

But is it not true that, stripped of its gloss and technicalities, the right hon. Gentleman's statement, once interim relief is over, will mean that the real poll tax charged to working-class home-owning households in valley communities such as New Tredegar, Merthyr Vale, Aberfan and Brithdir will increase hugely as compared with the position under the present rating system?

How can the Secretary of State possibly justify that? I know that he has nothing to lose in those communities but he has gained nothing politically. However, he has a reputation to lose. He was supposed to be sensitive and caring to the needs of the valley communities, but he will destroy any reputation by implementing this inequitable system.

Without the interim relief, which makes quite a contribution in Merthyr Tydfil, the community charge would go to £167, compared with an average of £131 per adult previously. Merthyr will also have the benefit of its share of the £11 million lower rates on businesses in the valley area. There are many people in Merthyr on low incomes and they will get the benefit of much better rebates than under the previous system. A total analysis of Merthyr shows a very good result. The total cost in Merthyr to a charge payer who does not receive any rebate at all will be £100 a year less than for people in England or Scotland.

The Secretary of State said that the total standard spending of £2·114 billion will be "well up" on the equivalent figure for this year. Can he tell us the percentage by which it will be up, and whether the amount was agreed with local authorities? Does he stick by the assurance which was widely broadcast in the Welsh press last month, that no one will face an increase greater than £25 a year?

On the hon. Gentleman's last point, I think that I will probably have to change the figure and say that nobody will pay more than £20. However, I cannot be certain about that. That will apply in all communities designated for the relief under the system that local authority associations in Wales agreed was the best system to apply. It will also apply to people who are not in such communities, but in all communities designated for the relief it is likely that people will finish up with a maximum increase of £20. I shall try to get the exact constituency figure. It is substantial.

Does the Secretary of State agree that he seems to be brushing aside the assessment of every district council and county council in Wales of the amount that they really need? In my county of Mid Glamorgan the councils have worked out that their needs assessment is greater by about 3 per cent. than the amount to be provided by the Welsh Office. On that assessment alone, those councils will need £20 a head in poll tax more than the Welsh Office estimates. The council treasurer in the district of Ogwr, half of which I represent, has said that the figures so far provided do not take account of the fact that last year about £800,000 was taken from the reserves to maintain the services in the borough. The Welsh Office assumes that the borough can do that again this year, but it cannot.

The Welsh Office has not yet announced the new debt redemption rules, which will have an effect on the amount of poll tax that has to be levied. The Welsh Office seems to be assuming that everybody who registers for the poll tax will pay, but we know that in Scotland at least 10 per cent. did not. That has to be taken into account. Will the Secretary of State admit that, all in all, it is the Welsh Office that has got it wrong and not the local authorities in Wales?

Perhaps the hon. Gentleman will excuse me while I reply to the previous question asked by the hon. Member for Caernarfon (Mr. Wigley). The percentage increase is 9·4 per cent.

Under the present arrangements, I do not think that there will be a substantial increase in the borough of the hon. Member for Bridgend (Mr. Griffiths). The hon. Gentleman claims that all local authorities suggest that their spending will be higher than the Government estimate. I have had the privilege of being a Member of the House for 30 years, under Governments of every complexion, and I have never known a rate support settlement under any Government being greeted by local authorities with the words, "The Government have given us exactly what we want and have agreed with our estimates." But the worst period was under the last three years of the last Labour Government in which the hon. Member for Alyn and Deeside (Mr. Jones) was at the Welsh Office.

Does the Minister realise that many poor people who do not qualify for rebates, although they work on low pay and live in poor quality housing, even with transitional relief will face increases of 25 or 30 per cent. in their bills? When that transitional relief goes in two years' time, hundreds of thousands of people in Wales will find their bills doubled. What does the Secretary of State have to say to those people?

The Secretary of State is no doubt aware that the Select Committee on Welsh Affairs has identified a number of problems, endemic to the valley communities, that will require large expenditure. These include cleaning up the environment and identifying landfill sites full of methane. How will local authorities pay the huge amounts of money that will be needed to drain such sites without the kind of increases that have already been suggested?

On the general improvement in the environment in the valleys, the total expenditure going, for example, on derelict land clearance is on an all-time, historic scale and way above any level previously achieved, and it is a committed programme for the next three years.

Order. I think that all the remaining hon. Members who wish to ask a question are Front-Bench spokesmen. I ask them to have consideration for the 40 hon. Members who wish to take part in the coming debate. I should appreciate it if they were brief.

I thank the Secretary of State for Wales for the letter that he sent me today apologising for the wildly inaccurate and misleading figure that he gave me in an answer to an oral question that I asked a week ago today. Will he avoid further embarrassment for himself by revising the figure of the standard poll tax that he has given, with which every treasurer in Wales seems to disagree? Will he agree with these local authorities, which have a fine record of good value service, and say that the average ratepayer in Wales faces an increase of 20 per cent.? Or will he wait to send every poll tax payer in Wales a letter of apology because he has cruelly misled them today?

I sent the hon. Gentleman a letter that clearly stated the nature of the figures, and gave him two figures instead of the one that I had presented. I then sent a copy of that letter to the Library. To suggest, as the hon. Gentleman has done, that there was something terrible about that when the letter confirmed that the average wages in Wales and in his constituency in real terms were much higher than when the Government took over from the last Labour Government, is wrong.

I should hate the public to get a false impression from what the hon. Gentleman has said. The people of Newport will be paying less under the community charge then they were under the rating system, and I shall see that all the electors of his constituency are circulated with these figures, so that they can compare them with those in the scare campaigns that the hon. Gentleman has conducted on the community charge.

The Secretary of State will know that teachers' pay is well over half the education budget, and that the Secretary of State for Education and Science has already announced that teachers' pay will be increased by 7·5 per cent. from 1 April next year. That figure is likely to be increased by the interim advisory committee. Therefore, how does the Secretary of State expect Welsh local authorities to manage with what is a GDP inflator of about 5 per cent. when this year, they have to make special provision for local management? How can they ensure that local management will get off on a good footing with this great burden?

The 7·1 per cent. increase in budgets—9·4 per cent. of total spending—and the potential improvement in efficiency will enable authorities to cope with the problem of teachers' pay.

Why did the Secretary of State use the figure of 2 per cent. on which to base his inflation forecast?

In view of the Secretary of State's answer to the hon. Member for Clywd, North-West (Sir A. Meyer), and of the fact that he will inflict it on the people in Wales from next April, would he give the House two or three sentences of full, wholesome and unstinting praise of the poll tax?

Certainly. The people of Wales should be grateful for and pleased with any tax that produces the result that the people of Wales, on average, pay £100 per person less than the people of Scotland and England, and under which 85 per cent. of local government expenditure is met by the business community and Government.

Will the Secretary of State tell the local authorities of Wales how they are supposed to make up next year for the shortfall announced over the weekend by the EC of £20 million a year, if not £25 million, in European regional development fund receipts over the next few years?

Will he explain why it is that the people of Wales are asked to choose between believing the right hon. Gentleman, who says that the 7 per cent. or 7·1 per cent. increase is okay, and non-political city treasurers like John Markham in Cardiff, who says that 11 per cent. is necessary and that the right hon. Gentleman's settlement is causing great anger in the city hall?

If there is one city in the United Kingdom that should be pleased about going over to the community charge, it is Cardiff, where it is likely to result in a 22 per cent. cut in domestic contribution. That is the largest reduction in Wales and no safety provison—[Interruption.] I look forward to making sure that the people of Cardiff recognise how lucky they have been.

Will not the Secretary of State accept that many of his figures are misleading? Will he not accept also that his statement makes nonsense of consultation, and that it has been condemned by hon. Members on both sides of the House? He has stuck precisely to both the total standard spending level and the aggregate external financing level with which he started the process. The right hon. Gentleman has not listened to councillors and treasurers throughout Wales, who have explained that this level of settlement is inadequate. Will he listen to the House and accept that a standstill in local authority spending will require a level of standard poll tax of more like £210 than his £173, and that only after belt tightening? The right hon. Gentleman is the person who is introducing poll tax in Wales, and the people of Wales know that he is the person who will be responsible for the heavy level of poll tax that will be contained in the demands that fall through their letter boxes.

The manner in which the Labour party is trying to urge local authorities in Wales to go in for extravagant expenditure—[Interruption.] The Labour party says that an increase of 9·4 per cent. in total standard spending is inadequate and unreasonable and that much more should be given—that is from a party which cut rate support grant in real terms year after year when the Labour Government were in office—when the fact is that we have made a perfectly reasonable and sensible assessment. There is no reason why the community charge in Wales should not be the figure which I have given, of £173 on average.

Points Of Order

4.27 pm

On a point of order, Mr. Speaker. It is widely expected that the ombudsman's report on the Barlow Clowes scandal will be available to hon. Members tomorrow. As you will know, the report is especially important to me as the first Member of this place to ask the ombudsman to undertake an investigation. In a letter that I have received from Sir Anthony Barrowclough, he tells me of his intention to

"arrange for all 650 Members to be notified, on the day the report issues, that a copy of the report will be available for him (or her) to collect from 3.30 pm that day (from the Vote Office)."
The letter also states:
"I understand from the Department of Trade and Industry that the Government will be publishing its response to the report at the same time."
If the Secretary of State is to make a statement in response to the ombudsman's report simultaneously with its publication, will that not put hon. Members in difficulty? We shall presumably have to choose between obtaining the report from the Vote Office and listening to the Government's response in the Chamber. Nor will there be any opportunity even to try to influence the Government's response. Indeed, we shall not have seen the report, which has been known to Ministers for some weeks, before the Government give their response. Is there any help or guidance that you can give to the House on this important matter, Mr. Speaker?

First, I am not aware officially that a statement is to be made tomorrow. I understand, however, the difficulty which has been mentioned. I have no doubt that the Leader of the House, who is on the Government Front Bench, will have taken note of what the right hon. Gentleman has said. There may be—

Further to that point of order, Mr. Speaker.

No. I have not finished yet.

There may be other opportunities during the week— perhaps during the Consolidated Fund debate or during the Christmas Adjournment debates—to deal with this matter.

Further to the point of order, Mr. Speaker. Having received a letter similar to that referred to by my right hon. Friend the Member for Manchester, Wythenshawe (Mr. Morris), I wrote immediately to the ombudsman and asked for sufficient copies of his letter for all my constituents who have been worrying over many months in a similar way to the constituents of my right hon. Friend. I asked the ombudsman to ensure and guarantee straight away that there would be sufficient copies so that each of my constituents could have one.

All those who have contacted me over the weekend have stressed that they want to see exactly what the ombudsman has said. They want their own copies of the report. As it appears that we cannot question individual Ministers because of the independence of the ombudsman, is there some way in which you, Mr. Speaker, on our behalf, can draw to the attention of the ombudsman the importance of Members of Parliament, who seek to serve their constituents, being provided with sufficient copies to give to indivdual constituents?

I understand that the report will be laid tomorrow, and it will then be available in the Vote Office. I am not certain that it is within my responsibilities to ensure that every constituent who has been affected should receive a copy, but no doubt sufficient copies will be available for hon. Members to pass on.

On a point of order, Mr. Speaker. I wish to raise a matter of which I have given you prior notice, through the Clerk Assistant, about the Property Services Agency and Crown Suppliers Bill. The matter is urgent because the Bill begins its Committee stage tomorrow, and I well understand that a motion needs to be moved if the Bill is to be committed to a Special Standing Committee, at which there can be hearings, before we begin our discussions in Standing Committee.

This matter involves £10,000 million for the PSA and £3,000 million for the Crown Suppliers. That amounts to billions of pounds, so the matter cannot be peripheral. It is highly desirable that the Government make arrangements, as they can do very easily, to withdraw the Bill from Standing Committee and instead have two or three hearings under the Special Standing Committee procedure. The new head of the PSA should be heard, and so should the trade unions—

Order. We have a very busy day ahead and I think that I can deal with the hon. Gentleman's point. The relevant motion was not moved last week when it could have been moved. Any hon. Member could have moved the motion, but that did not happen. There is nothing that I can do about it now.

May I explain why it was not moved? At that time, it was not clear that the Government would not answer parliamentary questions. They said the trade union evidence was tendentious, but when asked what was tendentious about it, they replied in general, and would not be specific. There needs to be a proper inquiry of two or three sessions before we discuss the Bill in Standing Committee.

Mr. Speaker