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Commons Chamber

Volume 177: debated on Monday 23 July 1990

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House Of Commons

Monday 23 July 1990

The House met at half-past Two o'clock

Prayers

[MR. SPEAKER in the Chair]

Death Of A Member

I regret to have to inform the House of the death of Michael Carr esquire, Member for Bootle, and I desire, on behalf of the House, to express our sense of the loss we have sustained and our sympathy with the relatives of the hon. Member.

Private Business

British Railways Bill

Order for Consideration of Lords amendments read. To be considered tomorrow.

City Of London (Various Powers) Bill

Lords amendments agreed to.

London Underground (Victoria) Bill

Read the Third time, and passed.

Greater Manchester (Light Rapid Transit System) Bill Lords

Considered.

Ordered,

That Standing Order 205 (Notice of Third Reading) be suspended and that the Bill be now read the third time.— [The First Deputy Chairman of Ways and Means.]

Read the Third time and passed.

London Docklands Railway Bill

Order for consideration read.

To be considered tomorrow.

Oral Answers To Questions

Oral Answers To Questions

On a point of order, Mr. Speaker. Is it in order to ask whether the gross discourtesy shown to members of the Select Committee on Energy and to Scottish Members by making the important announcement about the Britoil golden share on Friday was connected with weekend press reports that the Minister with responsibility for oil is about to be sacked? If that is so—

Order. It takes up time from other hon. Members' questions and it has nothing to do with energy questions today. This matter was raised on Friday, which is a full working day here.

If that is the case, Mr. Speaker, what powers do you have to ensure that the rights of Back-Bench Members are protected from musical chairs on the Government Front Bench?

This matter arose on Friday. I said then that it would have been convenient if we had known of it beforehand, but Friday is a working day in the House of Commons.

Energy

Friends Of The Earth

1.

To ask the Secretary of State for Energy when he next expects to meet Friends of the Earth to discuss energy-related issues.

I have no present plans to meet Friends of the Earth.

If my hon. Friend receives a request to meet these friendly and earthy people, will he say yes to it and then do all that he can to reassure them that the Government attach a high priority to the promotion of alternative and renewable forms of energy?

My right hon. Friend has already had a meeting with Friends of the Earth. We shall always be happy to have further meetings because they would enable us to tell them that the Government are stimulating the development and application of all promising renewable energy sources by means of a major research, development and demonstration programme. To date the Department has spent more than £160 million on research, and the budget for this year is about £20 million. A special place has also been set aside for about 600 MW of capacity from renewable sources under the non-fossil fuel obligation—in addition to whatever is contracted for under the initial tranche. I would welcome the opportunity of giving Friends of the Earth this good news.

Is not the reality that there needs to be a substantial change in investment in favour of renewables and away from sources such as nuclear power? Will not the Minister find a positive response from organisations such as Friends of the Earth only when he shows that the Government understand the economics of energy and spend money in the right place?

We pay significant regard to energy efficiency. The hon. Gentleman might like to recall that United Kingdom energy consumption in 1989 is less than it was in 1979, despite a 25 per cent. increase in gross domestic product.

Energy Efficiency

2.

To ask the Secretary of State for Energy what programmes his Energy Efficiency Office operates to disseminate advice on energy efficiency to consumers of electricity.

We promote efficiency in the use of all sources of energy, including electricity.

I am grateful for that reply. What statutory role will there be after privatisation for the electricity companies to give advice on energy efficiency?

The 12 distribution companies have a statutory role now under the Electricity Act 1989. That role will be overlooked by the Office of Electricity Regulation, which already has good contacts with my Energy Efficiency Office.

Is the Minister aware that he is one of the few Ministers who deals with Opposition questions on energy efficiency and other matters with a great deal of courtesy? It makes a change. Is he as fed up as I am at reading in every paper over the weekend of his imminent demise and possible replacement by the Under-Secretary of State for Scotland, the hon. Member for Stirling (Mr. Forsyth)? If that happened would not it speak volumes about the appalling state of the Tory party?

I am most grateful to the hon. Gentleman for his complimentary remarks. Unless I am gravely mistaken I am still standing here.

Gas Prices

3.

To ask the Secretary of State for Energy when he last met the chairman of British Gas to discuss the level of gas prices for industrial consumers.

My right hon. Friend and I meet the chairman of British Gas from time to time to discuss a range of issues of mutual interest, including the fact that industrial gas prices have fallen by 41 per cent. in real terms over the past five years.

I thank my right hon. Friend for that excellent news. Does he agree that that implies that a large part of British industry will now have a major competitive advantage? That, in conjunction with the fact that we have the lowest domestic gas prices in Europe, is a major vindication of our privatisation programme.

I agree with my hon. Friend. He spoke about domestic gas prices. Since privatisation the price of domestic gas has fallen by 14 per cent., so all round British Gas has a very good record.

Can the Minister give any assurances and with any confidence that gas prices will not rise when gas is used as a bulk burn fuel in power stations?

As the hon. Gentleman knows, the price of gas depends on the efficiency of British Gas and the other North sea gas producers. It also depends on supply and demand.

British Coal

4.

To ask the Secretary of State for Energy how much the Government have invested in British Coal since 1979.

We have assisted the corporation in financing over £7 billion of new investment since 1979.

Will my right hon. Friend confirm that the Government have invested far more in the coal industry than did their predecessors? As a consequence, the arrangements between British Coal, National Power and PowerGen for the supply of coal mean a secure future for coal mining in Britain which will play a major part in future developments.

My hon. Friend is absolutely right. The new contracts with the electricity generators provide British Coal with a large market opportunity, a guaranteed income stream over the next three years, and time to adjust to the needs of a competitive electricity market. My hon. Friend is also correct about the support that the Government have given to the coal industry.

Grants made available to British Coal under this Administration exceed in real terms the total assistance given by all previous Governments since nationalisation of the industry was completed.

Will the Secretary of State comment on the paradox that the Government and almost all their supporters have boasted for the past decade or more about record investments in British Coal, but that the market opportunity, although the Secretary of State may describe it as large, is small? Every member of the Government and most of their supporters joyfully trooped through the Lobby to secure the replacement of the investment about which the Government boast.

The Government's support for the coal industry has enabled it to make massive improvements in productivity, which is now about 75 per cent. over the pre-strike level. That is a fine achievement and will enable British Coal to compete in the market at the end of the three-year contracts with the generators. I hope and expect that British Coal will achieve a substantial share of that market.

Given the massive size of investment in the industry, and that much of it is long term, should not we also take steps to ensure that British industry is not held hostage to fluctuations in world prices in coal? I refer in particular to the importation of sulphur-free coal.

It is impossible for any industry to be entirely insulated from world prices or environmental considerations, but the step that we have taken in improving the productivity of British Coal and playing our part in the European directive on emissions will enable British Coal to take advantage of the position in future.

Does the Secretary of State accept that many of the grants that have gone into the coal industry since 1979 were effectively investments in its closure and rundown? Does he agree that where there has been capital investment, to which he correctly referred, we must make sure that it has the long-term effect of producing coal? We must get way from three-year contracts, which are no good whatever to the coal industry. With the chairman of British Coal, will he get together people from National Power and PowerGen and begin discussions about long-term contracts so that investment is not wasted?

I agree with the hon. Gentleman this far: the three-year contracts are only a start and longer contracts are needed for the coal industry. I am sure that he will welcome the fact that a substantial part of the support that British Coal has received from the Government has enabled the necessary changes in manpower levels to be achieved in as humane and reasonable a way as possible.

The bulk of the assets being written down stem from the "Plan for Coal" initiated by the Labour party when it was in office. That was based on a forecast of coal demand that failed to materialise. I do not say that no recent investments will need to be written down as a result of the collapse of energy prices, but the Monopolies and Mergers Commission report on British Coal's capital investment last year noted an improvement in the corporation's investment appraisal procedures. That augurs well for the future.

Does my right hon. Friend agree that the figures demonstrate that the nationalisation of British Coal was an unmitigated disaster? When can the taxpayer look forward to that burden being removed?

If I had been around in 1946 I should not necessarily have agreed with the solution of the then Government. However, that might be controversial. The Government's policy is to privatise the coal industry. Proposals will be put before Parliament, but after the next election.

Energy Efficiency

5.

To ask the Secretary of State for Energy when he next expects to meet Neighbourhood Energy Action to discuss the home energy efficiency scheme.

I meet the director of Neighbourhood Energy Action and representatives of other organisations as necessary to discuss the development of the home energy efficiency scheme.

I thank the Minister for that reply. Is he aware of the promise that the home energy efficiency scheme would be introduced by 1 November? All the people involved in introducing such a scheme, including a rock wool factory in my constituency, continue to state openly that the Government will not introduce the scheme by 1 November. The Government have backtracked on the promises that they made. The House and the nation want some assurance that the Government will get off their backside and do something about introducing the scheme by 1 November as they promised.

I am sure that the hon. Gentleman wanted the consultation that has taken place during the past few months. I hope that he would not have wanted us to go ahead without seeking the views of all groups involved, including Neighbourhood Energy Action. He will be pleased to hear that I hope shortly to come forward with the final details of the scheme. As he will realise, the scheme is a successor to the community insulation projects and, therefore, will flow naturally through.

Will my right hon. Friend confirm that the rate of energy efficiency improvement in this country has been running at more than double that of the European Community average? Is not that largely due to the success of our community insulation programme? What plans does my right hon. Friend have for continuing that success?

I can certainly confirm that we have had a pretty good record during the past 10 years. However, it would be a mistake to be in any sense complacent, which is why I and my officials at the Energy Efficiency Office are visiting every part of the country to promote our message as best we can.

Does not the Minister astonish even himself with his complacency? How can he claim to be so proud of energy efficiency improvements over the years when he is severely cutting funds to voluntary agencies helping to minimise energy loss? Is not that at best inconsistent with the right hon. Gentleman's remarks, and, at worst, hypocritical?

If I give the impression that I am complacent, I assure the hon. Gentleman that I am not. As I said before, the nation's energy spend amounts to about £40,000 million a year, and our target is to reduce that figure by £8,000 million. Substantial new moneys are coming to the Department for the home energy efficiency scheme, which will also help. I suspect that many of the deliverers—the people who do the job—will be voluntary agencies as well as companies in the private sector.

When my right hon. Friend next talks about energy efficiency to neighbourhood groups, will he impress upon them the importance of the fluorescent gas-filled bulb, which lasts about five years and costs next to nothing to run, but which the bulb manufacturers of the world are slow to produce because they have a vested interest in the consumer replacing bulbs every five minutes? Will he try to persuade British manufacturers to produce those bulbs, because they can be obtained only from abroad at a cost of about £15 to £20 each? Nevertheless, hotels have caught on to their advantages.

If anything, I am becoming a bit of a bulb bore. I assure my hon. Friend that I promote that message as hard as I can. He may not realise that such bulbs are now being produced in this country, and I hope that we shall find them on supermarket shelves from the autumn this year. Those bulbs are certainly very efficient, and every right hon. and hon. Member could benefit by using them in their homes.

Gas Act 1986

6.

To ask the Secretary of State for Energy what proposals he has to amend the Gas Act 1986.

I have raised before in the House the dilemma confronting Coventry city council, as a consequence of the Gas Act 1986, in relation to the cheaper price of contract rather than tariff supplies. The council has decided to heat 17 schools and old people's homes from now until 30 November with all their windows open, so that 56,000 extra therms will be consumed and the council will qualify for the cheaper contract gas, thus saving the city £30,000. The problem is not unique to Coventry among local authorities. The Minister and his Department responded to paragraph 4 of the Energy Select Committee's report, saying that they are confident that British Gas and the Office of Gas Supply will continue to discuss that aspect until a satisfactory solution is found. To whom is such a solution to be acceptable, and how long will those discussions continue?

The hon. Gentleman perfectly reasonably cites a problem which I accept exists. However, it is fair to say that in Coventry, as in any other part of the country where there is aggregation, there is no need for the city council to burn gas in the way that the hon. Gentleman describes.

That may be so, but in practice, because of aggregation, the total sum that the council will have to pay is no more than it would have paid a year ago. Nevertheless, efforts are being made by Ofgas, British Gas and myself to work out a solution to this complicated problem. It is not a question of the legislation but of how one tapers through its provisions. Genuine efforts are being made to resolve the problem.

Does my right hon. Friend accept that that scandalous waste of gas has been going on too long? It is not only schools and the public sector that are deliberately wasting gas to pay less for it by qualifying for an industrial tariff, but commercial interests such as hotel groups and retail outlets. It pays users having a consumption of about 18,000 therms to burn up to 25,000 therms because they will then pay less for that gas. Is not it time either to allow aggregation below 25,000 therms or to amend the Gas Act 1986 so that that ridiculous anomaly can be removed?

I do not quite agree with my hon. Friend's figures, but it is perfectly fair to say that my hon. Friend, like the hon. Member for Coventry, South-East (Mr. Nellist) points to a problem. Work is going on to see how that problem can be solved.

The privatisation of the utilities has certainly resulted in competition at the industrial and commercial ends of the market. But, as last week's increase in British Telecom's charges shows, there is severe discrimination against domestic consumers. What will the Government do to protect domestic gas consumers?

The hon. Gentleman cannot have been listening to one of my earlier replies when I said that since privatisation the domestic gas consumer is paying 14 per cent. less in real terms for gas.

Alternative Energy Sources

7.

To ask the Secretary of State for Energy when he proposes to have discussions with the European Commission about alternative sources of energy.

Neither my right hon. Friend nor I have any current plans to have discussions with the European Commission. However, alternative sources of energy are likely to be relevant in future Council discussions. The next Energy Council is planned for 29 October.

Is my right hon. Friend satisfied that the balance between United Kingdom national research and European Community research is about right? Does not he think that more of this research should be undertaken on a European basis?

I think that I am satisfied that the balance is about right in terms of the JOULE 2 and THERMIE programmes. As a result of the European Community coming together, the total spend by those nations on research and development is about right.

Will the Minister ensure that at the Council of Ministers meeting on 29 October a clear proposition is laid before the Council that Dounreay, in the north of Scotland, should be developed as a centre of excellence for research into renewable energy sources, instead of the current proposition, which is to turn it into a nuclear dustbin?

I do not agree with the final part of the hon. Lady's question, but I listened carefully to the former part.

If and when my right hon. Friend has discussions with the European Commission on alternative energy sources, will he review with it the possibilities and opportunities for wave power? If he finds that there is potential for wave power, will he reassess the Salter duck, which was designed and developed in this country, but, unfortunately has not yet been exploited?

As my hon. Friend will know, the Department spends a considerable amount of money on research and development into wave power, and currently we are reviewing that research. As for Mr. Salter and his ideas, my hon. Friend might be pleased to hear that he came to my office a few weeks ago where we had a long discussion, and that I intend to visit his laboratories in Edinburgh as soon as I can find the time.

Electricity Privatisation

8.

To ask the Secretary of State for Energy when he next expects to meet the chairman of the area distribution companies to discuss privatisation.

I meet regional electricity company chairmen regularly to discuss a range of matters and have recently set the debt levels of the 12 regional electricity companies and the National Grid Company. The total debt will be £2,843·5 million. I have arranged for the company-by-company figures to be published in the Official Report.

As 10 of those 12 companies have already failed to meet Government profit targets—it has not stopped the chairmen from taking substantial pay increases—how does the Secretary of State expect shareholders to make informed decisions if the only information that they will have is the knowledge of that failure to meet profit targets?

That is not the only information that they will have. A proper prospectus, as required by law, will be published and the information will be available there. That is the right time to assess those companies. The results to which the hon. Lady referred reflect the unusually mild winter and the recent storms, but also—and much more important—they are, to an extent, irrelevant under the new competitive regime that we have created.

Has my right hon. Friend yet had a chance to assess how the bidding system for electricity is working? Does he believe, as I do that it is already having the effect of bringing down the price of electricity to the distribution companies, which will be passed on to the consumer in the fullness of time?

Obviously, I am interested in looking at the information which comes in, but it is too early yet to form any firm conclusions about how the pool price will settle down. However, I agree with my hon. Friend that the arrangements that came into effect on 1 April mean that a great many of our larger electricity consumers have had the price of their electricity significantly reduced.

Is the Secretary of State aware that if members of any Labour local authority had handled the public assets entrusted to it in the way in which the Government have handled the assets built up by public money and the labour of those in the industry, they would have been charged with wilful misconduct, brought before the courts and barred from public office and that they would have been lucky to escape the charge of absolute political corruption?

Only the right hon. Gentleman could have put his question in that way. The Government dealt with the problem of the publicly owned electricity supply industry by vesting it on 31 March in the plcs, all of which are still owned by the Government. The Government will proceed to the privatisation of the majority of them, though not of Nuclear Electric. We shall see to it that we get a proper price for the sale of shares in those companies.

When the Secretary of State last met the bosses of the distribution companies, did he tell them what steps he was taking to protect the independence of the privatised electricity companies? Does he recall that the House was promised on 13 December 1988 that no individual or company would be allowed to take more than a 15 per cent. stake in any of the electricity companies? Is that promise another victim of his desperation over privatisation? Is the Hanson solution intended only for PowerGen?

I shall be making a statement about the wider issues at a later date, but the competitive nature of the electricity supply industry that we have created also bears importantly on the position of the regulator. He received complaints some time after 1 April, as a result of which he made some very marginal changes in the way the arrangements work.

Following is the information:

Regional electricity companies: debt

£ million

Eastern Electricity plc263·0
East Midlands Electricity plc127·0
London Electricity plc338·5
MANWEB plc63·0
Midlands Electricity plc120·0
Northern Electricity plc164·0
NORWEB plc153·0
Southern Electricity plc295·0
SEEBOARD plc125·0
South Wales Electricity plc25·0
South Western Electricity plc80·0
Yorkshire Electricity Group plc189·0
1,942·5
The National Grid Company plc901·0
2,843·5

Flue Gas Desulphurisation

9.

To ask the Secretary of State for Energy what is his most up-to-date estimate of the United Kingdom requirement for flue gas desulphurisation in (a) National Power and (b) PowerGen coal-fired power stations in 1998 and 2003.

I expect flue gas desulphurisation to be retrofitted to 8 GW of power stations as part of measures to meet the sulphur dioxide reductions required by 1998.

Mr. Speaker, Sir, I want to know what the Department is playing at. Is the Minister aware that only last year the Prime Minister promised that there would be no increase in imports of low-sulphur coal? Yet the Department is jigging around with FGD reductions in our power stations. It is obviously selling out the environment and the mining industry. The Government have clearly sacrificed the environment and the mining industry on the altar of privatisation, so the Minister should get up there and come off it.

I intend to say this quietly because I want to be sure that the hon. Gentleman hears it. This year, under the contract between British Coal and the generators, the generators will be taking 70 million tonnes of British coal. In evidence to the Select Committee, British Coal estimated that, with 8 GW of flue gas desulphurisation installed, the generators could burn 70 million tonnes of British coal in 1998. In other words, on British Coal's own evidence it will be perfectly feasible in 1998 for the generators, with 8 GW of FGD fitted, to burn exactly the same volume of British coal as they are burning today, if they so choose. More FGD could be retrofitted to meet the target for the year 2003, 13 years away, if the generators felt it appropriate nearer the time.

Is not the key dimension the total amount of sulphur dioxide emissions across the whole of the generating industry and not just a particular sector of it?

Everyone is determined that we should play our full part in reducing sulphur dioxide emissions. We are determined to meet the European Community's large combustion plant directive and to ensure that power stations play their part in meeting the requirement of the reduction of sulphur dioxide emissions, which is what the directive is all about. We shall ensure that the United Kingdom meets the terms of that directive. The Environmental Protection Bill now before Parliament provides statutory powers to ensure compliance with the legislation and the directive.

Now that the Government have chickened out of their commitment to fit flue gas desulphurisation to 12,000 MW of power stations and their privatisation programme is looking like the charge of the electric light brigade, will the Minister say what discussions are taking place with Hanson about the acquisition of PowerGen? What part will chickening out of their environmental commitment play in the Government's discussions with Hanson, which acts as a scrap-metal merchant for large parts of the British economy? Does the Minister accept that privatisation is not so much a holy grail for the Government as the Turin shroud?

The hon. Gentleman was clearly so busy polishing up his phrases for the benefit of parliamentary sketch writers that he did not listen to what I was saying. The Government are determined to meet the European Community's large combustion plant directive, under which certain targets are to be met in certain years. One of the target years is 1998. As I have made clear, on British Coal's own evidence to the Select Committee on Energy, with 8 GW of FGD retrofitted it will be perfectly possible for the generators, if they so choose, to burn exactly the same volume of British coal in 1998 as they do today.

Energy Conservation

10.

To ask the Secretary of State for Energy what resources his Department devotes to improved energy conservation; what recent measures he has introduced to improve energy conservation; and if he will make a statement.

Our initiatives include the best practice programme, an increased role for the regional energy efficiency officers, and the public sector campaign. In addition, a new home energy efficiency scheme for low-income households is being prepared.

Does my right hon. Friend agree that energy conservation is as important as energy creation, and that every household in Britain can play its part? Is he aware that in Leicestershire, the average three-bedroomed, semi-detached house could make £50 savings per year for an investment of £100 on roof insulation or £30 per year for a £10 investment on lagging the tank?

I agree with my hon. Friend that households in Leicestershire, Lincolnshire or wherever could nearly all make a major contribution to their household bills and thus to the economy.

There must be some way of converting all the energy that we use bobbing up and down in the House to provide energy for the House of Commons. More importantly, has the Minister noticed the high concentrations of photochemical smog in London during the hot spells in the past week or so? How do the Government intend to monitor the pollution levels and what do they intend to do about the causes of that major health hazard to Londoners?

I have noticed every now and then a scudding cloud, as it were. I will refer the hon. Gentleman's question to my right hon. Friend the Secretary of State for the Environment.

Does my right hon. Friend agree that one of the most energy conservation-conscious industries is the glasshouse industry? Will he consider introducing a green tariff for those industries that recycle their flue gas and carbon dioxide as the glasshouse industry does? I know that my right hon. Friend is a defender of the environment, even in his own greenhouse.

It is kind of my hon. Friend to refer to my propensity to enjoy my garden and, indeed, my greenhouse. I agree that people who use greenhouses do so most efficiently and effectively and to the enhancement of the environment. The question of taxation implications with which my hon. Friend is trying to tempt me would be better put to my right hon. Friend the Chancellor of the Exchequer.

Sizewell B

11.

To ask the Secretary of State for Energy how much public money has been spent on Sizewell B to date, how much is committed currently, and if he will make a statement.

A total of £1,510 million has been committed, of which £920 million has already been spent. both figures are at 1987 prices.

Does the Secretary of State recall the statement made at the Hinkley inquiry by Mr. Brian George, chief executive of the PWR group of Nuclear Electric, that if we did not build a family of PWRs, expenditure on Sizewell B would be extremely doubtful? Is not the reality that the nuclear industry will not only fail to make a profit but will not break even and that if it were in the private sector it would have gone bust long ago? What prevents the Government, when they are casting around for money to save the public purse, from considering the most obvious candidate—Sizewell and the nuclear industry?

Much of the answer to the hon. Gentleman's question will be contained in the response that I shall shortly be making to the Select Committee report and from which it would not be right to quote at the moment. I have made a thorough review of the costs of Sizewell B. On an avoidable cost basis—the only basis which matters for my decision—Sizewell B output is comparable with that from a combined cycle gas turbine, on central assumptions, and cheaper than that from a coal-fired plant. That is the essential decision that I have to take.

The Arts

Photography

79.

To ask the Minister for the Arts whether he has met the chairman of the Council of Regional Arts Associations to discuss the regional arts associations' future policy towards, and financing of, photography.

No, Sir. As I indicated to the hon. Gentleman on an earlier occasion, the Arts Council will be reviewing its support for photography as part of its development of a national strategy for the arts. The strategy will provide the framework within which the regional arts assocations will develop their own plans for photography.

Is the Minister aware that recently I invited several 12 to 13-year-old Indian girls to the House of Commons to improve their photography, no doubt breaking a few hundred rules of this place in doing so? Given the universality of photography, will he support my plea for more cash for the Arts Council to enable photographers to be employed in schools to teach children to improve their composition and photographic skills?

The hon. Gentleman has done much over a long period to promote photography. The Arts Council gives £500,000 of taxpayers' money to support photography in this country and there has been a 10 per cent. increase in the overall budget this year. The Arts Council has an education unit, and I shall bring the hon. Gentleman's views to its attention.

Given my right hon. Friend's encouragement of all aspects of the touring arts, will he consider encouraging the bringing together in one place of the history of photography and cinematography, including perhaps the works and artefacts of Edward Nuybridge, so that it can be taken around the country to encourage people in this form of the arts?

I note what my hon. Friend says. With the 150th anniversary last year of the invention of this form of art, much attention has focused on it. As my hon. Friend knows, the national museum of photography, film and television at Bradford does an outstanding job in promoting photography in this country.

You may be aware, Mr. Speaker, that rumours are circulating that today could be the Minister's last Arts Question Time. If that is so, may I take the opportunity—on behalf of the whole House, I suspect—to pay tribute to him? He has made many friends in the arts world and is respected as a person who listens and cares about the arts. Many hon. Members would be reluctant to see him go because of the many things that he has achieved in his time. He should not, however, confuse that praise for him as a person with support for the Government's policies.

On that point, and arising out of the funding question asked by my hon. Friend the Member for Houghton and Washington (Mr. Boyes), will the right hon. Gentleman give the House an assurance that whoever is Minister for the Arts in the coming weeks he or she will be fighting for an increase in the arts budget in this budget round as the Arts Council is set for a real-terms cut in its three-year funding and without an increase the arts will suffer enormously?

I am not sure what to make of the hon. Gentleman's generous remarks and I am not clear how photography is linked with my future. The Government's record on funding for the arts is remarkable. Since 1979, there has been a 45 per cent. increase in real terms in the overall amount of money available to the arts from the taxpayer. That excludes the remarkable increase in the overall amount of private sector funds, which has been the fuel for the expansion of resources available to the arts.

In so far as the Government's record has been remarkable, it is largely due to my right hon. Friend's sterling endeavours. I hope that he will carry on in this job for many years and I urge him to do what he can to assist photography.

I shall do whatever I can to assist photography. All I can say is that an hour is a long time in politics.

European Convention On Heritage And Culture

80.

To ask the Minister for the Arts what plans he has to bring into force a European convention on heritage and culture by the end of 1992.

I am not aware of the existence of a European convention on heritage and culture. I assume that the hon. Gentleman is referring to the discussions taking place about arrangements for our heritage after 1992. These are at an early stage, but I am in close touch with my European Community colleagues on these issues.

The Minister is right that there is not yet a European convention, but there is great concern that when the single European market comes into force at the end of 1992 there should be a convention to prevent the disappearance of works of particular merit through loopholes not only at national boundaries but at European boundaries. Will the right hon. Gentleman undertake to pursue with urgency a proposal for such a convention which would supplement European law and would be in force in good time before the end of 1992?

I appreciate the importance of the hon. Gentleman's question. There is no doubt that there is concern about stolen works of art and their illicit export. These matters are under discussion by European Community Ministers, but it will take a little more time before we reach conclusions. The hon. Gentleman was right to imply that one of the implications of 1992 is that there will be no full-scale customs control at frontiers. We therefore have to find an alternative way of dealing satisfactorily with the illicit export of works of art. I assure the hon. Gentleman that I shall give great attention to this matter in the months ahead.

Will my right hon. Friend, given his outstandingly successful work as Minister for the Arts in the United Kingdom, make it clear that the point of any international convention is to create duties and obligations? What on earth is the point of that in the arts? Is it not far better to run the arts from the United Kingdom?

My hon. Friend is right in the sense that article 36 of the treaty of Rome makes it clear that it is up to each individual state within the European Community to preserve its heritage in the way that it wishes. In this country, we have a liberal system in terms of free trade in works of art, but with some protection for the heritage. I believe that those principles should remain.

Would not one possible advantage of such a convention on heritage and culure be that we could get laws banning censorship written down in a way which cannot be challenged? With such a convention, we would not end up with a ridiculous decision such as that made by the British Board of Film Classification, which is seeking to impose censorship on the publication of a book which most of us in a liberal society agree should be freely available to be read. It is ridiculous that we are faced with an accusation of double standards. That could end if there were a European convention.

I am not sure what bearing that has on heritage within the European Community. As the hon. Gentleman knows, however, it is important to stress that in this country we believe in freedom of expression, subject to the laws of the land. That is how it should be.

Curatorial Training

81.

To ask the Minister for the Arts how many public museums and galleries currently sponsor candidates for curatorial training; and if he will make a statement.

This information is not held centrally. The Government recognise the importance of museums training, and have supported the establishment of the Museums Training Institute, for which £400,000 is being provided in the current financial year.

I am extremely grateful to my right hon. Friend for the funds that he has made available through that quarter. Nevertheless, is he not concerned at the large number of museums and galleries employing untrained staff, many of whom would like to be trained? Unfortunately, there are not enough places where they can go to be trained. Will my right hon. Friend consult our right hon. Friend the Secretary of State for Education and Science with the aim of making such places available, funded wherever possible by public museums and galleries?

I will look further at my hon. Friend's suggestion. He has taken a persistent interest in museums and galleries. I very much hope, however, that the £400,000 of taxpayers' money for the establishment of the Museums Training Institute will enable us to strengthen considerably the training available for management and volunteers, and also for attendants—thus raising still further the high standards in our museums.

In view of the enforced early retirement of Dr. Juliet Clutton-Brock, what arrangements will be made for curatorial training in archaeo-zoology and related sciences?

The hon. Gentleman has, as always, shown his capacity to ask the most penetrating question, and to expect Ministers to answer in specific terms. I shall look into the matter. I will, however, make the general point that it is important to find ways in which we can raise the standard of professionalism in our museums. That is not to say that that standard is not high already, but training facilities are inadequate and we need to do a great deal about that.

Civil Service

Civil Service Trade Unions

96.

To ask the Minister for the Civil Service when he last met representatives of the civil service trade unions to discuss conditions of work.

I meet the civil service unions from time to time to discuss a range of matters.

Is there any truth in the rumour that civil servants get a special supplement for drawing up lists of sacked Ministers for the Prime Minister? If so, can we assume that Charles Powell receives the biggest bonus payment of all? When he gets the poke, will this Minister send him a letter of congratulation, or one of complaint?

I wonder whether the hon. Gentleman has the capacity to imagine himself as a civil servant. The mind boggles at the very thought, but if he put himself in the shoes of a civil servant—those of Mr. Powell, for instance—he would realise how utterly unreasonable it is to attack a civil servant who cannot defend himself.

Let me say without hesitation, that Mr. Powell—like every other civil servant in the country—serves the elected Government of the day with great distinction.

What would be the reaction of the Inland Revenue to its working conditions if it had to revalue every property in the country as part of a policy of reintroducing domestic rates?

I know that I answer questions on more than one subject, but I do not think that I have direct responsibility for that one.

I do not know whether there are any rumours about the Minister leaving his responsibility for the civil service, but if he is, I wish him well. Before he goes, however, I hope that he will spare a thought for the incompetence and bungling of the Parliamentary Under-Secretary of State for the Environment, his hon. Friend the Member for Southampton, Itchen (Mr. Chope), who has destroyed morale at the Crown Suppliers and also destroyed its trade. A trade surplus of £6·3 million two years ago has become a £12 million loss now and its value of £100 million has been turned into a £4 million deficit. The Minister has deprecated attacks on civil servants who cannot defend themselves. Will he therefore join me in defending the interests of those civil servants and ensure that, whatever happens at the Ministry, integrity is reintroduced into government and morale restored to the Crown Suppliers and the civil servants who work for it?

The hon. Gentleman is wrong to suggest that morale in the civil service needs to be restored. As I go round the country, I see civil servants in different sections of the service doing a marvellous job with great enthusiasm. The Crown Suppliers is specifically a matter for my right hon. Friend the Secretary of State for the Environment. There is a clear question of deciding whether it is best to manage services through privatisation, through the creation of agencies or by some other means. The Government's sole concern is to ensure that the resources that we have are managed to the benefit of the public.

Does my right hon. Friend agree that one of the most important conditions of work is a reasonable work load? Will he join me in utterly condemning those trade unions, particularly the National Union of Mineworkers, which have put an unreasonable work load on to our loyal civil servants by mismanaging their finances? Civil servants and the NUM are now busily trying to find out where all the money has gone. Can my right hon. Friend assure the House that civil service trade union finances are much better managed than those of the NUM, where it is clear that they cannot count beyond 10 unless they take their boots off?

My hon. Friend makes an effective point. I have a high regard for the civil servants in this country. Compared with almost any others in the world, they do an outstanding job.

Appointments

97.

To ask the Minister for the Civil Service how many appointments have been made at grades 1 to 3 since 1979.

There are approximately 650 posts at these grades, to which about 1,000 appointments have been made over this period. Totally accurate figures are not available for the early years.

I realise that the Minister is biased, but does he appreciate that those figures appear to some people to be a process of Thatcherisation of the civil service since 1979, as we know the general approach that the Prime Minister and her Ministers adopt to recruitment? It seems that taxpayers' money is being used to install Tory party loyalists—or stooges, in the jobs throughout No. 10—to senior appointments in the civil service. Would not it be better to have a genuinely impartial appointments system or an open and honest spoils system rather than what appears to be the politically motivated, politically biased and hyprocritical system of appointment that exists now?

That was a colourful question, but the hon. Gentleman knows that the civil service in this country is utterly impartial and that the Government do not make political appointments to top professional civil service posts. Here I pray in aid the all-party Select Committee on the Treasury and Civil Service, which in 1986 said that it had received

"no convincing evidence that the British civil service is being or has been politicised."
That speaks for itself.

I cannot say how many of those 1,000 appointments are women. However, recruitment figures now show that more than 50 per cent., including high fliers, are women. There has been a big increase in the number of women in the civil service, but there are still very few at the top level. I hope that equality of opportunity will ensure that more get there.

Natural History Museum

98.

To ask the Minister for file Civil Service if he will make a statement on his meeting with the IPMS to discuss the future of personnel at the natural history museum.

I have recently received a request from the general secretary of the Institution of Professionals, Managers and Specialists for a meeting. I have indicated that I will be happy to meet Mr. Brett and his officials at an appropriate time.

Would an appropriate time be before 30 September? Will the right hon. Gentleman place in the Library his responses to the letters that he has had from the Smithsonian? What does the Minister think about the 950 letters that he has received from distinguished institutions around the world pleading the case of the natural history museum?

With regard to the first part of the hon. Gentleman's question, I see no reason why the meeting should not be before 30 September. It should be possible to arrange something during September. Of course, I shall consider placing the exchange of letters in the Library as the hon. Gentleman suggested. I shall see what can be done. I remind the hon. Gentleman, as I have done before, that the natural history museum does an outstanding job and I stress that all collections at the museum continue to be accessible to the outside world. Researchers and staff will be available to give advice and if special research is necessary it is possible to make contractual arrangements for that with the museum.

Ethnic Monitoring

99.

To ask the Minister for the Civil Service if he will make a statement regarding his office's implementation of its ethnic monitoring policy.

My Department continues to monitor the ethnic origin of applicants and new entrants to assess the effectiveness of our equal opportunities policies.

I thank the Minister for that answer. If he does move on, he will at least have left behind the appreciation of many people for his personal efforts on equal opportunities. Does he recognise, however, that a vast amount remains to be done and that an equal opportunities monitoring policy is useless on its own without positive action to ensure its enforcement? What is the Minister doing to ensure that his policy is brought into real effect so that we get some black people at senior levels in the civil service?

The hon. Gentleman knows that at the end of May I launched a programme of action to ensure proper equality of opportunity for black and Asian people within the service. I stress that it is equality of opportunity and involves getting there on the basis of merit. I am sure that the hon. and learned Gentleman would not disagree with that. I hope that he feels that the programme of action will facilitate that aim.

Disciplinary Code

100.

To ask the Minister for the Civil Service if he has recently reviewed the civil service disciplinary code.

Can my right hon. Friend tell me how the civil service disciplinary code works when, as appears to be the case with the Public Health Laboratory Service, bad advice is given to a Minister whereby a whole industry —in that case, the egg industry—suffers grievous damage? From my investigations, published recently in a book entitled "Chickengate", I found that most of the cases on which the Public Health Laboratory Service's evidence was based were wrongly interpreted and that poor hygiene was responsible for the salmonella, as it is today when cases of salmonella are increasing despite the slaughter more than a million chickens. How is the Public Health Laboratory Service to be held accountable for giving Ministers very bad advice?

At the end of the day, Ministers are accountable for the policies and actions in their area of responsibility and that principle should not be undermined. However, if a civil servant has broken a rule or performed incompetently, the disciplinary code exists and appropriate action can be taken.

Teachers' Pay

3 pm

On a point of order, Mr. Speaker, about the statement.

Well, how can there be a point of order about a statement which we have not heard?

On a point of order, Mr. Speaker. It is unclear whether the statement applies only to England and Wales or to the United Kingdom. It was the same—

Order. The hon. Member for Dunfermline, West (Mr. Douglas) may have an opportunity to put a question during the statement. I call Mr. MacGregor.

I now order the hon. Gentleman to leave the Chamber for the remainder of today's sitting.

I repeat that I order the hon. Gentleman to leave the Chamber for the remainder of today's sitting.

Order. The hon. Member will put himself in jeopardy if he does not now obey the order of the Chair.

Motion made, and Question put,

That Mr, Dick Douglas be suspended from the service of the House.— [Sir Geoffrey Howe.]

The House divided: Ayes 177, Noes 25.

Division No. 310]

[3.34 pm

AYES

Arbuthnot, JamesGreenway, Harry (Ealing N)
Arnold, Jacques (Gravesham)Gregory, Conal
Ashby, DavidHague, William
Baker, Nicholas (Dorset N)Hanley, Jeremy
Baldry, TonyHannam, John
Barnes, Mrs Rosie (Greenwich)Hargreaves, A. (B'ham H'll Gr')
Batiste, SpencerHargreaves, Ken (Hyndburn)
Beaumont-Dark, AnthonyHarris, David
Bennett, Nicholas (Pembroke)Haselhurst, Alan
Blackburn, Dr John G.Hattersley, Rt Hon Roy
Blaker, Rt Hon Sir PeterHaynes, Frank
Boscawen, Hon RobertHayward, Robert
Boswell, TimHicks, Robert (Cornwall SE)
Bowden, Gerald (Dulwich)Higgins, Rt Hon Terence L.
Bowis, JohnHind, Kenneth
Boyes, RolandHoey, Ms Kate (Vauxhall)
Braine, Rt Hon Sir BernardHordern, Sir Peter
Brandon-Bravo, MartinHowarth, G. (Cannock & B'wd)
Brazier, JulianHowe, Rt Hon Sir Geoffrey
Brown, Michael (Brigg & Cl't's)Howell, Rt Hon D. (S'heath)
Bruce, Ian (Dorset South)Hughes, Robert G. (Harrow W)
Buck, Sir AntonyHunt, Sir John (Ravensbourne)
Burns, SimonIrvine, Michael
Burt, AlistairJack, Michael
Butler, ChrisJanman, Tim
Carlisle, Kenneth (Lincoln)Jessel, Toby
Carrington, MatthewJohnson Smith, Sir Geoffrey
Cartwright, JohnJones, Gwilym (Cardiff N)
Clark, Dr Michael (Rochford)Kellett-Bowman, Dame Elaine
Clarke, Rt Hon K. (Rushcliffe)Key, Robert
Coleman, DonaldKinnock, Rt Hon Neil
Coombs, Simon (Swindon)Knapman, Roger
Couchman, JamesKnight, Greg (Derby North)
Cran, JamesKnight, Dame Jill (Edgbaston)
Cunningham, Dr JohnKnox, David
Davies, Q. (Stamf'd & Spald'g)Lawrence, Ivan
Davis, David (Boothferry)Lennox-Boyd, Hon Mark
Dickens, GeoffreyLightbown, David
Douglas-Hamilton, Lord JamesLloyd, Sir Ian (Havant)
Dover, DenMacfarlane, Sir Neil
Durant, TonyMacGregor, Rt Hon John
Dykes, HughMacKay, Andrew (E Berkshire)
Evans, John (St Helens N)McLoughlin, Patrick
Fallon, MichaelMcNair-Wilson, Sir Patrick
Favell, TonyMadel, David
Fenner, Dame PeggyMalins, Humfrey
Field, Barry (Isle of Wight)Mans, Keith
Finsberg, Sir GeoffreyMaples, John
Flynn, PaulMarshall, John (Hendon S)
Fookes, Dame JanetMartin, David (Portsmouth S)
Forman, NigelMates, Michael
Foster, DerekMaxwell-Hyslop, Robin
French, DouglasMichael, Alun
Gale, RogerMiller, Sir Hal
Garel-Jones, TristanMitchell, Andrew (Gedling)
Glyn, Dr Sir AlanMoate, Roger
Golding, Mrs LlinMonro, Sir Hector
Goodlad, AlastairMontgomery, Sir Fergus
Gorman, Mrs TeresaMorris, M (N'hampton S)
Gow, IanMorrison, Sir Charles
Grant, Sir Anthony (CambsSW)Morrison, Rt Hon P (Chester)

Moss, MalcolmSpearing, Nigel
Mudd, DavidSpeller, Tony
Neale, GerrardSpicer, Sir Jim (Dorset W)
Nicholson, David (Taunton)Squire, Robin
Nicholson, Emma (Devon West)Stern, Michael
Onslow, Rt Hon CranleyStevens, Lewis
Owen, Rt Hon Dr DavidStewart, Andy (Sherwood)
Page, RichardSummerson, Hugo
Patnick, IrvineTapsell, Sir Peter
Pawsey, JamesTaylor, Ian (Esher)
Porter, Barry (Wirral S)Taylor, John M (Solihull)
Price, Sir DavidTaylor, Teddy (S'end E)
Raison, Rt Hon TimothyThompson, D. (Calder Valley)
Renton, Rt Hon TimThompson, Patrick (Norwich N)
Rhodes James, RobertTredinnick, David
Riddick, GrahamTwinn, Dr Ian
Roe, Mrs MarionWakeham, Rt Hon John
Rooker, JeffWaller, Gary
Rossi, Sir HughWard, John
Rost, PeterWheeler, Sir John
Rumbotd, Mrs AngelaWiddecombe, Ann
Scott, Rt Hon NicholasWolfson, Mark
Shephard, Mrs G. (Norfolk SW)Wood, Timothy
Shersby, MichaelYeo, Tim
Shore, Rt Hon PeterYoung, Sir George (Acton)
Sims, Roger
Skeet, Sir Trevor

Tellers for the Ayes:

Smith, Rt Hon J. (Monk'ds E)

Mr. Sydney Chapman and

Smith, Tim (Beaconsfield)

Mr. Tom Sackville.

Soames, Hon Nicholas

NOES

Ashton, JoeMeale, Alan
Benn, Rt Hon TonyMichie, Bill (Sheffield Heeley)
Bennett, A. F. (D'nt'n & R'dish)Mullin, Chris
Bidwell, SydneyNellist, Dave
Cohen, HarryPatchett, Terry
Cryer, BobRedmond, Martin
Cummings, JohnSalmond, Alex
Douglas, DickSkinner, Dennis
Galloway, GeorgeVaz, Keith
Godman, Dr Norman A.Wise, Mrs Audrey
Hughes, John (Coventry NE)
Lambie, David

Tellers for the Noes:

McAllion, John

Mrs. Margaret Ewing and

Madden, Max

Mr. Harry Barnes.

Mahon, Mrs Alice

Question accordingly agreed to.

Ordered,

That Mr. Dick Douglas be suspended from the service of the House.

I have to direct the hon. Member for Dunfermline, West (Mr. Douglas) to withdraw, in compliance with the order that the House has just made.

The hon. Member withdrew accordingly.

3.44 pm

With permission, Mr. Speaker, I should like to make a statement on new negotiating machinery for school teachers' pay and conditions.

I wrote to the local authority employers and the teacher unions on 26 April setting out proposals for new permanent pay negotiating machinery for settling the pay and conditions of school teachers in England and Wales. Over the past two months I have engaged in full and careful consultations on the basis of those proposals. I am now able to announce the Government's decisions about future machinery for determining the pay and conditions of school teachers. I intend at the earliest opportunity to bring forward to the House a Bill to give effect to these decisions.

Different and incompatible views on the proposals were expressed during the consultations. Most urged on us a restoration of negotiating rights for teachers; others preferred independent review, but they were not willing to agree the establishment of a permanent body similar to the present Interim Advisory Committee on School Teachers' Pay and Conditions. It is clear that we are far from a consensus in favour of independent review on a basis that would be acceptable.

Accordingly, we intend to provide for free negotiations between employers and teachers under an independent chairman. The Government will not be a party to those negotiations. There will be no pre-set financial limit on the negotiations. The employers will know the aggregate external finance that the Government are ready to make available for local authority expenditure as a whole and will consider what they can afford in the light of that. There will be a time limit on the negotiations.

If the negotiators agree recommendations before the time limit, it will fall to the Secretary of State to consider implementation. If the time limit passes without agreement, however, the negotiations will come to an end. The Government will seek recommendations instead from an independent advisory committee, broadly similar to the present interim advisory committee. This will not be arbitration. The Government will set the body a clear and specific remit. Again, it will fall to the Secretary of State to consider implementation.

I hope that it will normally be possible to accept the recommendations that are put to us, but we have also to provide for circumstances in which that is not the case. If the Government are unhappy with aspects of negotiated recommendations on pay and conditions they will be able to refer these issues back to the negotiators, giving their reasons. If agreement does not result from this process, however, the Government will need to be able to resolve the deadlock. We shall provide for that through a power for the Government to substitute their own provisions on matters referred back, subject to negative resolution of each House of Parliament. The Government would intend not normally to refer back recommendations on cost grounds if the overall cost was within the inter-quartile range of private sector settlements for non-manual employees.

Within the negotiating body there will be a separate sub-committee to deal with heads and deputies. Responsibility for initiating proposals for changes in pay and conditions of heads and deputies will rest with the sub-committee. The sub-committee's recommendations will come to me for consideration unless both sides of the main committee agree to refer them back to the sub-committee, and subsequently to change them. The precise machinery for this and other, more detailed, features of our proposals are explained in the paper placed today in the Vote Office and in the Library of the House.

I recognise that some employers—be they local education authorities or the governors of grant-maintained schools—may judge that they could better respond to local needs and circumstances if they settled the pay and conditions of their teachers themselves. As envisaged in the consultation document, LEAs will have the opportunity to apply to me to opt out of the national provisions governing pay and conditions, on the basis that they are able to put in place satisfactory arrangements of their own. Grant-maintained schools, too, will be able to opt out of the national provisions.

Teachers are due a review of their pay to take effect next April. Given the need for legislation to establish the new negotiating arrangements, it would not be possible to deal with this settlement under the new arrangements, and that was accepted by all those whom I have been consulting. None supported the option of dealing with the settlement retrospectively through the new machinery once it is statutorily in place. There was insufficient agreement about the possibility of running the new machinery on a voluntary, shadow basis in advance of legislation. I have concluded, therefore, that I should seek the approval of the House later in the year to extend the Teachers' Pay and Conditions Act 1987 for a further, and final, year, and to invite the interim advisory committee to make recommendations to me for a settlement to cover the year April 1991 to March 1992. The first settlement decided in the new machinery would be that to take effect from April 1992.

The arrangements which I have outlined offer full and fair opportunities for negotiations between teachers and their employers, and a means to resolve deadlock if the negotiators cannot agree. They acknowledge the interests of employers, teachers and Government in the determination of teachers' pay. They afford a basis for the peaceful resolution of questions of pay and conditions, and their adaptation to the changes which face our schools in the 1990s.

Is the Secretary of State aware that the removal of negotiating rights from teachers in 1986 and the continued delay in re-establishing them has in itself been gravely damaging to teachers' motivation and self-respect, and that that is one reason why our schools face greater problems today than at any time in living memory? Will he confirm that by his statement the first negotiated settlement cannot take place until 1992, six years after the last one? Will he give more detail of the veto that he intends to retain?

Will the clear and specific remit to the new advisory committee include cash limits set without reference to the negotiations, notwithstanding the fact that in his statement the right hon. Gentleman said guardedly that there would be
"no pre-set financial limit on the negotiations"?
Does that undertaking cover the exercise of his veto? Given the substantial powers of veto which the right hon. Gentleman is taking unto himself, does he understand the strong case for this to be subject to the affirmative procedure, not to the negative resolution procedure?

Is the Secretary of State aware that his proposal to allow individual local education authorities and grant-maintained schools to opt out of the national pay negotiating machinery will be seen as no more than an attempt by him to appease his critics on the right of the Conservative party and as a cheap dodge to avoid his responsibility for the current nationwide teacher shortage crisis? Why does he not understand that the reason why teacher shortages have risen by 50 per cent. in two years is primarily that teachers' pay nationally has fallen so far behind that of comparable groups, and that in real terms their pay is now even lower than in 1986?

If local authorities are allowed to set whatever salary scales they choose, what additional resources will the Secretary of State give them to back his words with hard cash? Since such an arrangement could work to solve teacher shortages only if it led nationally to leapfrogging and wage drift, how much does the Treasury think that this will add to public spending?

If a local education authority which is poll tax capped opts out of national pay bargaining, does the Secretary of State have the agreement of the Secretary of State for the Environment to lift poll tax capping in respect of such teachers' pay settlements?

Is the Secretary of State aware that, far from this being a new idea, such a system operated before the war and was abandoned because of the damage that it caused to the education service? Is he aware that the proposal is opposed by the Conservative-led Association of County Councils? Is he also aware that his own Interim Advisory Committee on Teachers' Pay and Conditions, under the chairmanship of the Conservative Lord Chilver, gave the issue of differential subject and regional pay the most thorough examination in both its 1988 and 1990 reports and rejected it on the grounds that it would reduce teacher mobility, be unfair and inflexible, would move shortages round rather than solve them, and would be ineffective? Why has the Secretary of State rejected such powerful advice from his own appointed committee? Why does not he build on the wide local discretion within a national framework which the interim advisory committee has recommended?

This proposal is a shallow and damaging trick. It will not provide an extra penny for the system nor guarantee an extra teacher in the classroom. It shows yet again that the Ministers who have so damaged our education service are incapable of improving it. It is not just failed Education Ministers who need to be removed, but failed and discredited policies which must be abandoned forthwith.

I reject all those charges and I shall endeavour to deal with as many of the hon. Gentleman's points as I can. He asked when the new negotiating machinery comes into operation. I made it clear to him, on the assumption that there will be legislation in the next parliamentary Session, that it would be in March 1992. I think that there was general agreement in all my discussions that it would be necessary to have some interim arrangement, and the discussions centred on that. In the light of those discussions, I have concluded that this is the most sensible way forward for one year. Teachers will recognise that, as this is the final year, the proposal is sensible.

The interim advisory committee did an excellent job throughout the period during which it carried these responsibilities. Many of its recommendations were widely welcomed and had a good deal to do with a better career structure and pay and greater local flexibility in the system.

The hon. Gentleman asked about conditions for the use of either referring back or override powers. I shall consider all recommendations from the negotiating body on their merits. I expect that if there are issues that I want to address with override powers in mind, they would be concerned not just with costs but might be concerned—clearly one cannot be specific in advance because the matter is hypothetical—with a range of other factors, including professional duties and the pay structure. One possibility may be cases of disagreement about the pay of heads and deputy heads. As I have said, it is not possible to specify in advance, but I think that I have indicated why the powers are necessary.

The hon. Gentleman asked about a cash limit for any interim advisory committee or committee's recommendations. Clearly, such a possibility must be available to the Secretary of State. I do not know why the hon. Gentleman is so surprised about that because I recently asked him in our correspondence whether he would have cash limits and he replied:
"Cash limits would apply in the normal way … (if we inherited an IAC arrangement)".
A negative resolution offers a simpler procedure which will yield more timely pay settlements. That is clearly important in relation to some of the long delays that occurred in the machinery before 1986.

The hon. Gentleman asked about opting out. As he knows, there are teacher shortages in particular geographical areas, and in some parts of the country, especially in some London boroughs, the shortages are serious. I have been adopting a whole range of measures to try to assist local authorities to deal with that. The overall average vacancy in the country as a whole, excluding Greater London, is 1·3 per cent.

Yes, 5·3 per cent. The proposals that we advocate build on local flexibility and will act in precisely the right way to respond to market conditions in relation to pay. Therefore, what the interim advisory committee has done is already extremely helpful. The hon. Gentleman will be aware that the interim advisory committee recommendations this year, which I have fully accepted and which will be fully implemented by 1 January, came into effect after the collection of the vacancy survey data, details of which I announced recently. The pay recommendations will build on local flexibility and will be extremely helpful, not least in London, in resolving local shortages.

The hon. Gentleman referred to opting out. Precisely what I am doing will be helpful in resolving local teacher shortages and other difficulties. I am building on the local flexibility that we have achieved in the past three years, or so to tackle teacher issues. The proposed new machinery for opting out is a natural extension of that process.

Differential regional pay is also relevant to opting out. My statement today is not a set of proposals for regional pay, but I make it clear, as I have done on many occasions, that it is important to create greater differentials in the pay of individual teachers so as to relieve shortages in certain subjects. Therefore, the increasing flexibility that we have achieved in the system is necessary to recruit mature entrants and people who have a range of skills which command a high market premium. Therefore, the proposals that I put before the House and recommend today will assist us further in addressing those issues. They are positive and constructive.

The hon. Gentleman asked for additional resources, but he will know that the amount of resources from aggregate external finance was settled in the announcement by my right hon. Friend the Secretary of State for the Environment last week and in the decisions about the breakdown of resources into subject areas in the autumn. Local authorities will know before they embark on the pay negotiations what is available from central Government.

It is extremely rich of the hon. Gentleman to keep pressing for additional resources, because each time I ask him about the matter he carefully avoids the question. He knows that the Labour party would not provide additional resources. It is worse than that from his point of view. He will be aware that in his response from the Front Bench on community care last week, the hon. Member for Livingston (Mr. Cook) committed the Labour party to an additional £1·5 billion. Where would that leave the hon. Gentleman?

Is my right hon. Friend aware that his refusal to introduce a Son of Burnham or Burnham mark 2 will be widely welcomed? Is he further aware that his proposals, which will allow local education authorities and grant-maintained schools to opt out of the national pay machinery, will be welcomed by schools, teachers, governors and parents and will do a great deal to answer problems of teacher recruitment and shortages? In short, his statement is widely welcomed, not only by Conservative Members but by people outside the House.

I am most grateful to my hon. Friend. The proposals strike the right balance between the interests of the teachers in restoring their pay negotiating rights, those of their employers, who must take community charge payers into account, and the interests of the Government, who clearly have an interest because the taxpayers fund a considerable proportion of any local authority expenditure. I believe that the balance is right.

I am particularly grateful to my hon. Friend for what he said about the opportunities to opt out. We shall be legislating for some time to come. We shall provide clearly for not only the immediate and early stages of the legislation but the possibility of evolution. It will be for local education authorities and grant-maintained schools to decide if and when they wish to opt out. They should have the maximum flexibility to respond to local needs and circumstances. If they believe that the best way to achieve that is through establishing a local pay framework, they should have the opportunity to propose it. That will be particularly relevant to grant-maintained schools, where the governing body will be able to review the position in the school itself and possibly enjoy additional flexibility and freedom even beyond that which we have already given.

Tower Hamlets has a teacher vacancy rate of more than 10 per cent., compared with the national average of a little more than 2 per cent. How does the Secretary of State propose to prevent what could easily degenerate into a competitive scramble for scarce teaching resources spreading throughout the entire inner London area in particular? If an authority produces plans for paying its teachers more, can the right hon. Gentleman guarantee that it will be able to obtain the resources necessary to meet the cost of those plans?

The new education authority in Tower Hamlets is already tackling the problems that it inherited from ILEA with great vigour and with considerable effect. I believe that we shall see a better position in September than last year, due to the way that that authority is tackling its tasks, the increased flexibility that we have allowed, and the increased possibilities open to London authorities as a consequence of the interim advisory committee's recommendations on teacher pay. As to the right hon. Gentleman's general question, a considerable amount of flexibility already exisits in the system, which education authorities can use if they judge that that is where they should put their priorities. By giving them the additional opportunity to opt out, I am only building on that and allowing education authorities, in the light of their local circumstances, to address that aspect further. As to resources, there is already available to Tower Hamlets, as to many inner London boroughs, a supplement for additional education need from central Government.

I welcome the fact that my right hon. Friend has not been tempted back to the old and discredited Burnham procedure. It must be right to move pay bargaining closer to schools, which is the trend that I detect in the statement. Will my right hon. Friend clarify how that might help with differential pay, in dealing with teacher shortages—which, as he knows, is still a serious and worrying problem?

The proposals represent a considerable advance on the discredited Burnham procedure. I will give two examples of that. There will be a timetable for negotiations, and no possibility of deadlock—both of which were problems in the past. The system that we have been building on for the past three years—thanks not least to the recommendations of the interim advisory committee —allows individual LEAs and schools to offer more flexible pay to recruit not only those offering scarce skills but those whom they particularly want to attract in dealing with specific problems in London. Considerable flexibility, offering significant scope, already exists—but given that that is the right approach, it is proper to build on it. Opting out provides an opportunity to do that.

Teachers will welcome the plans to restore negotiating rights, albeit a year late. Can the Secretary of State explain why that is so? Only recently, he was failing to admit that state of affairs, although it was apparent to all that that was the case. Will not his plans for opting out create a wage war between rich and attractive local authorities and poor and less attractive local authorities—despite the fact that the latter suffer the most teacher shortages? Will not opting out simply ratch up teacher costs and the problems for some local authorities?

The Secretary of State said that local authorities will have to apply to him for permission for their schools to opt out, but will grant-maintained schools have to do so—or will they be free to opt out come what may?

On the first point, it is very clear to me from the fairly extensive consultations that I have had twice with the six unions and with local authority employers that these are complex matters. That is why it is not possible to reach agreement earlier. It became clear that it simply would not be possible to reach agreement because of the wide disparity of views that I was still facing. I have had lengthy consultations which have helped considerably, not least on many of the details in the proposals, and I believe that the time is now right to take decisions. That is what I have done.

As regards the position of what the hon. Gentleman described as "poor" authorities, they already have a higher standard spending assessment allowance per pupil, compared with other areas, and that is reflected in aggregate external finance. For example, the allowance per primary pupil in Hackney is about 70 per cent. more than the allowance in Somerset, and that makes my point clearly. As for applications for opting out, local education authorities will require my approval, and that is clearly laid out in the document which is now in the Vote Office. Grant-maintained schools can apply to me for opting out and they will get it automatically.

Order. I remind the House that there are two other statements, and ask for single questions.

Will my right hon. Friend take the opt-out principle further than he has done, although I congratulate him on the points that he has made today? Has not the time come to assess teachers' salaries individually? Could not that be done under a system of local management of schools throughout the country? Would not that system be more effective in overcoming regional and subject teacher shortages than anything else could be? Is it fair to say that a teacher in deepest Wales must cost less than a teacher in deepest London?

I am grateful to my hon. Friend for his remarks. It will be open to local education authorities to decide whether, if they wish to apply to opt out, they want to put a different arrangement in place. That will be available to them and to grant-maintained schools. It is important to take into account the fact that the extra flexibility in the system now goes a considerable way to enable local education authorities and new governing bodies of schools, under LMS, to have greater flexibility between schools. As my hon. Friend will know, there are may opportunities, such as incentive allowances and paying teachers on different grades of the scale which are now available to schools, but there will be additional opportunities as a result of the proposals.

Is the Minister aware that the worst teacher shortages are in the poorest areas, and that those areas will be least able to opt out and to pay teachers more? Therefore, will not the opting-out proposal that he suggests make things worse as boroughs such as Lambeth and Southwark, which are unable to opt out and pay more, lose teachers, who are siphoned off to Bromley, Surrey and Westminster, which can pay more? Is that not a fraudulent con-trick which will make the position in London far worse?

I have already pointed out to the House, and I repeat it to the hon. Lady, that authorities in the system, in the sort of boroughs that she talked about, already get higher standard spending allowances per pupil. I repeat, as an example, that the allowance per primary pupil in Hackney is about 70 per cent. more than the allowance in Somerset.

With this greater financial independence, is my right hon. Friend encouraging local education authorities, in conjunction with housing authorities, to buy property which they can rent to teachers? That would be useful in many parts of the country where there are high housing costs—I am obviously thinking of Bedfordshire and its neighbouring counties.

Some authorities, especially London boroughs, which are also housing authorities, are considering arrangements, and one or two schemes are now coming through. I was happy to agree a scheme for some of the properties inherited from ILEA earlier this year, to help with the problem of teachers' housing in London.

The Secretary of State has referred to the level of standard spending assessment for Hackney. He will be aware that we get more because we are one of the poorest boroughs in the country. The Minister will also know that we have a teacher vacancy level of 12·5 per cent., which is the second highest in the country. Does the Minister agree that it is nonsense to give boroughs like Hackney facilities to pay teachers more, if he is not prepared to fund that increase? Hackney and parts of east London are increasingly engulfed by a serious teacher shortage crisis. His statement today is a cruel fraud on parents and teachers in Hackney. When will he address the issue seriously, when will he tackle the problem of housing costs and when will he do something to stop the blight of a generation of children in east London?

Hackney gets more through the additional educational needs element. That is the point of it. In addition, a number of new measures have been introduced this year for teachers' pay which London boroughs can use, some of which are specifically directed, as the hon. Lady knows, at London boroughs. We have been assisting the inner-London boroughs in their teacher recruitment campaign. A number of other measures that we have taken on teacher supply are designed to help inner London. The hon. Lady will have noticed that one of the problems in Hackney is that the borough has been unable to pay its teachers so far because of its computer arrangements. I hope that they will be sorted out soon, because the money is there.

I congratulate my hon. Friend on bringing to a conclusion a particularly delicate and long procedure and thank him for keeping his promise to restore negotiating rights to teachers. Will he confirm that the legislation that he outlined, which I shall welcome, will lead to far more open debate about the merits and demerits of teachers' pay than we ever had?

Yes, I believe that that will be one result of the proposals, and I am grateful to my hon. Friend for welcoming them.

Does the Secretary of State realise that one of his statements is entirely wrong? If the present system provides flexibility, why is there a need for additional flexibility? If the present flexibility does not work, what makes the Secretary of State think that additional flexibility will work? Has he not taken into account the fact that staff are already leaving poll tax-capped authorities purely and simply because they find it easier to work for a non-poll tax-capped authority, and that the only ones who will suffer because of his ideas are the children whom we are supposed to educate?

On the hon. Gentleman's latter point, it is interesting that the vast majority of local education authorities were perfectly well able to draw up their education programmes this year without the need for community charge capping at all. On the hon. Gentleman's first point, the sort of flexibility that we have now has come only fairly recently into the system, and since April has been built on considerably. Some of the benefits, therefore, have still to flow through. It is right to allow local education authorities and grant-maintained schools to make their own arrangements, if they think that that is a better way to meet local needs. Their arrangements should be allowed to evolve.

Will my right hon. Friend accept the warm and sincere congratulations of many hon. Members, and of those who are interested in education throughout the nation, on his proposals? Does he agree that the new negotiating procedure—a new chairman, a new sub-committee and a new concept of flexibility—heralds a new era in education, which we welcome?

I am grateful to my hon. Friend. My proposals regarding the negotiating machinery and the restoration of teachers' negotiating rights are a considerable advance on Burnham and overcome some of the difficulties of which everyone had become aware. They will, I am sure, provide a sensible balance between all the interests concerned.

While I welcome the provision that local education authorities and grant-maintained schools will be able to set their own pay levels, which will enable them to respond to local needs and circumstances and to reward good teacher performance in the classroom, does not the Secretary of State recognise that inner-city boroughs such as Greenwich which are poll tax-capped will find it almost impossible to offer improved salaries to attract much-needed teachers, since cuts amounting to £10 million have to be made?

I am grateful to the hon. Lady for her welcome of the new flexibility, but may I point out to her that already there are immense variations in how local education authorities deal with priorities in their budgets. Let me give her one example. We have now moved to local management of schools. As a percentage of the general schools budget, a considerable amount of money is held back by individual local education authorities. Haringey, for example, is holding back 25 per cent., whereas Berkshire is holding back 10 per cent. There is therefore considerable scope for getting the money into the schools. Furthermore, an assessment of the returns that we have already received shows clearly that for administration—for bureaucracy alone—between 2 per cent. and 10 per cent. is held back. There is, therefore, considerable scope for greater flexibility, including in pay.

In welcoming my right hon. Friend's remarks, may I ask him to improve the general standards of literacy by asking the Department of Education and Science not to use the verb "disapply"? As the major Labour education authorities may start leapfrogging on salaries to increase all teachers' salaries, does my right hon. Friend agree that there is a case for taking a firmer line at local school level? Given the disparities that my right hon. Friend has just outlined, will he ensure that the governors in LMS schemes will have a greater say over differentials of pay?

I agree with my hon. Friend's main point. I am looking carefully at the returns that we are getting on the local management of schools from local education authorities to see whether there is justification for such a wide disparities in the amount held back in the centre—

We gave flexibility to local authorities, but the figures are raising some interesting issues, one of which is that there may be more opportunity for getting more money into the schools, and hence teachers' pay, in many authorities. We have created a system where everyone will be able to see the figures and ask the questions.

On my hon. Friend's first point, he will notice that I used the words "opting out" in my statement, but I am advised that "disapply" is the correct legal word for the document.

As a former chief negotiator of teachers' salaries in Scotland, may I ask the Secretary of State, on behalf of the Government, to give a guarantee that no such proposals will be introduced into the Scottish teachers' salary negotiations?

As a former local education authority officer, I welcome the flexibility that my right hon. Friend is giving to the state sector which already exists in the independent sector in other professions. There is no reason why teachers in Totnes and Toxteth should be paid the same. Does he agree that the Opposition have shown a lack of reality—they may believe that teachers would uproot themselves every few months to go to new schools, but schools would be wary about employing such people.

My hon. Friend makes the point that there are considerable opportunities to allow greater responsibility at school and governing body level, which is consistent with all that we are trying to do in the other reforms. Therefore, I agree with him.

Is the Secretary of State aware that the percentage vacancy rate, according to his Department, is 13 per cent. in the London borough of Newham, in the next-door borough of Hackney it is 12·5 per cent. and in Tower Hamlets it is 10·2 per cent.—there is an enormous concentration of teacher shortages in the east end. Newham is not in the Inner London education authority area, but has the highest percentage vacancy rate. Does he not realise that he is perpetrating a heartless fraud on the people of this country, particularly the east end, by suggesting that Newham, Hackney and Tower Hamlets—the three poorest boroughs in the country—are able to deal with the crisis? They simply do not have the resources. Will he make the resources available, because without them, we cannot solve the present crisis?

What is interesting when we look at the London figures is the wide disparity in London itself—Brent's vacancy level is 1·5 per cent. Local issues are involved and we are doing all that we can to deal with teacher supply. It is then for local education authorities to recruit. Not all the issues affecting the boroughs to which the hon. Gentleman drew attention are entirely educational; there are problems of attracting people to those boroughs, which is where we are trying to help.

I know that my right hon. Friend is aware that my local authority keeps 40 per cent. for the centre. Is he also aware that governors will be overwhelmed and delighted at the proposal to enable them to choose first division teachers and put pressure on LEA to choose first division teachers instead of fourth division football clubs.

I am grateful to my hon. Friend, who will know that, as a result of the obligation on local education authorities to publish the arrangements and figures involved in the local management of schools, it will be possible for governing bodies, governers, teachers, staff, parents, the general public and him to see whether the holdback is too great, exert pressure if they think it is, and ask questions.

Does the Secretary of State accept the crisis in education will not be solved by these rather cheap measures, as my hon. Friend the Member for Blackburn (Mr. Straw) described them? Will he address himself to capping? Is he aware that the Tories in Calderdale propose to wipe out in-service training for teachers? If that happens, they will not be trained to fulfil the requirements of the national curriculum. What guarantee will he give local authorities on funding? Is he aware that the 40 per cent. that is kept at the centre by Calderdale is spent on special needs, music and everything else that makes up a comprehensive education system? It is nonsense to suggest that it has anything to do with spending a lot on administration.

Government funding is allocated on a fair basis. Local authorities—and, within them, local education authorities—must decide their priorities.

For counties such as Essex, which is an area of high housing cost and is experiencing increasing problems recruiting teachers, is not my right hon. Friend's announcement about opting out a natural extension of the help that Essex county council has been receiving through education support grant—and on its own initiative—to attract teachers to its employ?

Yes. I am grateful to my hon. Friend, who will know that to recruit back qualified teachers who are not teaching—for example, because they are bringing up a young family—I have increased education support grant from £2 million to £10 million. In Essex and many other parts of the country, much more can be done to keep teachers who are not working—there are about 200,000 such teachers aged between 31 and 44—in touch with education changes so that, when they wish to return to work, they will not fear that education has moved on as a result of the national curriculum.

Will the Secretary of State note that in the House the other day some hon. Members demonstrated the corrupt nature of this year's distribution of central support for local government and therefore have profound anxieties that that corrupt system might continue when the new arrangements come into operation? Does he accept that, whatever some teachers might tell him, those who observe and are interested in British education recognise that the crisis of morale is worse now than at any time since the war and that the proposals of the Government, who have turned the educator into the bookkeeper, will not restore the morale of the profession?

I am aware that every local authority feels disadvantaged compared with every other local authority, but to describe the system as corrupt is ludicrous. We have progressed well in achieving a fairer system. The main issue affecting teacher morale is that they feel that they have an enormous challenge in implementing the national curriculum. More and more of them are aware that I am introducing the national curriculum in a way that will enable them to cope. As I visit schools, I find that that many more, as they get to grips with the national curriculum, are excited and enthusiastic and becoming positive about it.