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Commons Chamber

Volume 182: debated on Wednesday 5 December 1990

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House Of Commons

Wednesday 5 December 1990

The House met at half-past Two o'clock

Prayers

[MR. SPEAKER in the Chair]

Private Business

Fraserburgh Harbour Order Confirmation Bill

Mr. Secretary Lang presented a Bill to confirm a Provisional Order under section 7 of the Private Legislation Procedure (Scotland) Act 1936, relating to Fraserburgh Harbour: And the same was read the First time, and ordered to be considered upon 11 December and to be printed. [Bill 18.]

Oral Answers To Questions

Trade And Industry

Vehicle Mileages

1.

To ask the Secretary of State for Trade and Industry whether he proposes to introduce measures to record vehicle mileages and prevent the sale of unroadworthy vehicles.

The Parliamentary Under-Secretary of State for Industry and Consumer Affairs
(Mr. Edward Leigh)

My right hon. Friend the Secretary of State has asked me to apologise for his absence; as the House will no doubt be aware, he is otherwise engaged in Brussels at the GATT negotiations.

In answer to the question, the Government intend to tighten up certain aspects of the law relating to the sale of unroadworthy vehicles and appropriate measures will be brought forward at the earliest opportunity. There are, however, no plans to introduce any statutory requirement to record vehicle mileages.

I am grateful to the Minister for that reply. A 1987 survey conducted by trading standards officers showed that about 77 per cent. of older vehicles were unroadworthy and another survey showed that about 20 per cent. of hire vehicles were unroadworthy. That means that about 1 million of the vehicles traded annually are classed as unroadworthy because they have not qualified for an MOT certificate. Bearing in mind what the Minister has said and as trading standards officers now have powers to inspect vehicles under the trade descriptions provisions and in respect of credit arrangements, will the Minister be giving trading standards officers further powers to inspect vehicles for safety—[HON. MEMBERS: "Too long."] Will he also give further consideration to recording mileages at Swansea?

Trading standards officers already have to administer no fewer than 30 Acts of Parliament and 900 sets of regulations. Unlike Opposition Members, the Government are not convinced that tying up the measures with further red tape will do the industry any good at all. It is already an offence to sell unroadworthy vehicles.

Is the Minister aware that a large number of the second-hand vehicles that are sold have been clocked? Is he aware that a number of garages in the King's Lynn area have made representations to me about their grave concern about clocking of second-hand vehicles? Surely, one way forward would be to have cars manufactured with milometers that could not be put back or tampered with in any way.

I certainly undertake to take my hon. Friend's proposal back to the Department and consider it carefully. My hon. Friend will be aware that there is already a large body of law that protects the consumer. It is already an offence under the Trade Descriptions Act 1968, the Road Traffic Acts and the Sale of Goods Act 1979 to clock vehicles.

Joint European Research

2.

To ask the Secretary of State for Trade and Industry what discussions he has had on British companies' participation in joint European research projects.

My noble Friend the Minister for Industry has responsibility for research and technology policy. He attended the recent Research Council of EC Ministers on 20 November and discussed EC research and development issues with his ministerial counterparts and the European Commission.

What action does the Minister for Industry propose to take to help ICL compete for European research money now that it has been taken over by Fujitsu?

We raised the matter in writing with the responsible Vice-President of the European Commission. My noble Friend the Minister for Industry, who now represents the United Kingdom on research and technology issues, met the Vice-President to discuss the matter on 20 November. He was reassured that, for the purposes of collaborative research, the company would continue to be considered to be a British company.

Will my hon. Friend confirm that British companies take about a fifth of the European Community research funds available for industrial development? Does not that show clearly that, when they are playing on a level playing field, British companies are well able to hold their own in the European Community?

My hon. Friend is absolutely right and makes a very good point. We should always remember that the main spur to research is not what Government do but the profitability of industry. Industry's funding of research and development increased by nearly 50 per cent. between 1983 and 1988. My hon. Friend makes a fair point.

Financial Services

3.

To ask the Secretary of State for Trade and Industry what steps he is taking to ensure that the United Kingdom financial services sector is able to compete fairly in the single European market.

The financial services industry in the United Kingdom is a great success and I am sure that it will do extremely well from the wider European market that is now being constructed and in which we are participating fully with our partners. The Government are doing their bit by negotiating constructively on a number of measures to create the right framework for the wider industry. At the moment, we are negotiating on the financial services directive and the complementary capital adequacy directive. We are also working closely with the Commission to get passport directives on both life and non-life insurance.

We welcome the single European market, but we and others in the insurance industry worry about the unfair competition facing our companies from the German, Italian and French conglomerates. What is the Minister doing to ensure a level playing field for our British companies?

Of course we want a level playing field for all companies in the European Community. That is the purpose of negotiating fair rules of conduct, such as those in the directives that the Commission is now proposing. The hon. Gentleman can rest assured that the Government will battle hard to get a fair deal for our companies and for customers throughout the Community. If only Opposition Members had equal dedication to the purpose of creating an open and liberal market in Europe, that would make it even easier for us.

Could my hon. Friend give us a little more information about the progress that is being made with the capital adequacy directive? Are we any closer to achieving the position in which small to medium-sized financial intermediaries in this country will be allowed to continue to provide the service that they provide at the moment, bearing in mind the fact that the position in other European Community countries is very different from that which has always prevailed in the United Kingdom?

My hon. Friend is quite right. It is important for this country and for the European market as a whole that there should be a fair regime allowing independent financial advisers to carry out their important work. The United Kingdom Government have worked closely with the Commission to identify different categories of adviser for capital adequacy purposes, but we believe that their capital requirements should be related to the risks that they are running.

Under the current draft, investment advisers will not be required to provide any capital for that purpose, but will still gain access to the passport. We are now working on the question of how much capital those advisers should have who also handle client money and arrange deals for clients. That is still an issue of contention in Community negotiations. My hon. Friend can rest assured that we wish to see a flourishing independent financial advisory sector in this country and that we do not wish the directives to damage it.

The Minister just said that he is keen that British competitiveness should be enhanced in the single market, so I am sure that he agrees that it will be enhanced if his Department acts swiftly and efficiently when dealing with fraud when it is based in the City. In that context, what has the Minister done about the problems and financial difficulties at Hamilton House, which have now been with us for over three years? More specifically, when did his Department last receive communications from the regulators on this issue and what did the Department do?

I do not intend to go into the details of individual cases across the Floor of the House in such sensitive issues. The hon. Lady knows that we are keen to pursue fraud and malpractice wherever it may be. It was this Government who introduced powerful new laws and regulations to do so and we have brought a number of cases to court for that purpose. We are seeing again today that Opposition Members are interested only in fraud and malpractice. That is not the way to represent the United Kingdom's financial services industry to the wider Europe.

Will my hon. Friend confirm that some European Community member states impose controls and restrictions on cross-border insurance services which are not necessarily in the interests of the policy holders and which, in the end, only reduce competition and increase prices?

As my hon. Friend says, there are a number of barriers in the insurance market. One of the points we are trying to get across in the early discussions on the possible directives is that there is no need to regulate product specification.

The important thing is to regulate the solvency of companies and the fit and proper nature of those running them in carrying out the business. I hope that we have success in persuading our colleagues in Europe, because it is in the interests of all forward-thinking companies and customers in the wider Europe that maximum choice and competition is offered.

Manufacturing Output

4.

To ask the Secretary of State for Trade and Industry what plans he has to boost manufacturing output.

The Government promote continued growth of manufacturing industry with policies such as reducing rates of tax on profits, privatisation, deregulation, elimination of restrictive practices, trades union reform and negotiations to reduce trade barriers through the general agreement on tariffs and trade and in the European Community. In addition, my Department continues to operate a range of schemes to improve business performance under the enterprise initiative.

When the regional Confederation of British Industry and the Leeds chamber of commerce predict a bleak mid-winter for manufacturing as a direct result of the Government's policies, does not that suggest that those policies are not working? What practical action will the Government take to arrest the manufacturing decline in Leeds? Will the welcome, positive developments in the finance, service and business sectors be at the expense of engineering, printing and textiles, and costed in rising unemployment in my constituency?

What a pity it is that Opposition Members always want to talk down British industry. They fail to say that, in the past decade, output in manufacturing has increased by a quarter, compared to what happened under a Labour Government, when it fell. This Government recognise that manufacturing output depends critically on profitability and competitiveness which, under the Government, are at record levels.

Will my hon. Friend take the opportunity to pay a warm and generous tribute to manufacturing industry in the west midlands, which is still buoyant, particularly the hand-cut crystal glass industry, which is worthy of commendation?

I am grateful to my hon. Friend. He is a fine champion of British industry, particularly industry in the west midlands.

If the Minister would reflect for a moment on his foolish remark that the Opposition are not concerned about manufacturing industry, he might realise that in the 1980s, 30 per cent. of it was destroyed by a Conservative Government and we are once more in a recession, with manufacturing industry going to the wall. Would not it be more positive if he were to make representations to his right hon. Friend the Chancellor of the Exchequer to reduce interest rates, which would give manufacturing industry the boost that is sorely needed under this Government?

It does not help argument in the House for hon. Members grossly to overstate the case as the hon. Gentleman has done. He failed to say that, in the medium term, the prospects for British industry are excellent clue to the completion of the single market and the creation of new markets in eastern Europe. He also failed to say—and I shall repeat the point because he clearly was not listening to my earlier answer—that, contrary to what Opposition Members would have one believe, manufacturing output has increased by a third under the Government. Moreover—I am happy to go on giving the Opposition statistics—manufacturing productivity and export volume are 60 per cent. higher after a decade of Conservative Government.

Will my hon. Friend remind Opposition Members that all the simplistic interventionist formulae and subsidies were tried and failed in the 1950s, 1960s and 1970s? Will he remind them again that, the last time they were in power, manufacturing output fell, whereas in the 1980s, when this Government meddled less in industry, manufacturing output not only rose, but did so faster than in any other European country?

Will the Minister confirm that manufacturing output is down by £.1·5 billion in one quarter? Will he also confirm that, with jobs losses in steel, aerospace and hundreds of small businesses, Britain has suffered a loss of 2 million manufacturing jobs under this Government? Why are the Government compounding their high interest rate errors by cuts in training, technology and regional incentives? Now that we have a change of Prime Minister, what changes will there be in industrial policy?

I will tell the hon. Gentleman what is happening to British industry. Overall, employment in this country is at record levels, with 27·5 million people in work.

The hon. Gentleman talked about this year; I shall give him some more statistics, as he is clearly a glutton for them. In the first three quarters of this year, manufacturing output was still 25 per cent. up on 1980, and productivity is up considerably. Surely that is a record of which to be proud. It is important that we should not ditch our policies, as Opposition Members would, and that we persevere because they are the only policies that will result in keeping down inflation—the single greatest barrier to competitiveness in British industry and to creating real long-term jobs.

Will the Minister confirm that, far from the Opposition's suggestions of a decline in engineering being true, the motor industry is increasing production to export and is planning to double productive capacity over the next three years? Will he and his right hon. Friend ensure that the industry's efforts are not frustrated by attempts in the European Community to limit exports of British-made vehicles to our Community partners?

My hon. Friend makes his point very well. An interesting recent study shows that output in car manufacturing will shortly rise to a record level of 2 million—we can be proud of that. I certainly acknowledge my hon. Friend's point; as he knows, we make it vigorously to the European Commission.

General Agreement On Tariffs And Trade

5.

To ask the Secretary of State for Trade and Industry if he will make a statement on the Uruguay round of the GATT talks.

My right hon. Friend the Secretary of State is this week leading the United Kingdom delegation to the ministerial meeting in Brussels called to conclude the Uruguay round of trade negotiations. While the outcome remains uncertain and many difficult issues have still to be resolved, success is in our view essential to maintain and strengthen the multilateral trading system. We are working with our Community partners in Brussels this week to bring this about. The House had a debate on the Uruguay round on 23 November.

Is the Minister aware that every family in Britain pays an unseen and unauthorised tax of £15 a week to sustain agricultural subsidies so as to ensure that Christian Democrat and Conservative small farmers re-elect the same Governments in Europe? Will he have a word with the Secretary of State in Brussels and ask him to consider seriously the United States Government's proposals to reduce agricultural subsidies and support throughout the world, so that the bill paid by British families can be reduced?

I very much welcome the hon. Gentleman's enthusiastic support for an open trading system, because that is what we believe in. I hope that I shall have that same support if we start talking about textiles.

Is my hon. Friend aware that the common agricultural policy is the biggest single obstacle to the success of the GATT round? Does he agree that it is time to get rid of a policy that does not help the farmer and places an intolerable burden on every family in Europe?

My hon. Friend should recognise the fact that, although agriculture is important to achieving a successful outcome of the Uruguay round of the negotiations, it is not the only matter at issue. We hope that a flexible approach by the Community to the offer on the table, which is a good offer, will enable progress to be made on other areas of great importance, covering the whole range of exports of goods and services, which represent about a quarter of the output of British industry and commerce. All those elements can benefit from a successful outcome. If we concentrate solely on agriculture, we mislead ourselves as to what the round is about—but I agree that we must adopt a flexible approach.

As the objective of the European Community is that we all speak with one voice, does the Minister think that that should be seen to happen in practice, especially in negotiations in connection with GATT? Does he agree that the Government's decision yesterday to break rank with the rest of the Community is downright disgraceful? Will not that damage the interests of the United Kingdom's agriculture and weaken the Community's negotiating stance at these talks?

I do not recognise what the right hon. Gentleman is talking about. He speaks about the need for the European Community to speak with one voice. As I am sure he is well aware, the Community is the negotiating party in the GATT round. Of course, I hope he will agree that before the Community speaks with one voice, it would be sensible for the members of the Community to discuss and agree what is to be said by the Community on their behalf.

Does it strike my hon. Friend as ironic that the European Commission, which is supposedly dedicated to free trade, should be suggesting a common economic and fiscal policy and a single currency at the same time as its flagship, the common agricultural policy, is jeopardising the whole of the world's free trade? Goodness only knows what would happen if there were a common defence policy and the Community were in charge of sending British troops to war.

My hon. Friend makes a good point. It is important for the Community to show that it is able to make progress on issues for which it has been responsible for a long time, such as agriculture, before taking on fresh responsibilities. I hope, and I know that my right hon. Friend who is in Brussels also hopes, that flexibility will be shown at the meeting that is due to take place in about two and a half hours. I hope that we will be able to make substantial progress across the whole range of subjects being discussed.

Given the importance of the world trade talks to many industries and services and the seriousness of a breakdown, will the Minister tell us whether the Prime Minister has talked to Chancellor Kohl and President Mitterrand, or will talk to them at their joint meeting today, to see whether at the highest level a positive and constructive European initiative can be agreed in order to avoid deadlock?

As I have just said, there is a meeting at 6 o'clock Brussels time, 5 o'clock our time, of Trade and Agriculture Ministers of the Community. I have every hope that that meeting will cover the whole range of subjects being discussed. The Commission intends to put to the Ministers attending that meeting the progress that has been made. As a result, I hope that the Uruguay round will be able to go forward to a successful conclusion and that there will not be any damage to the prospect of a successful outcome because of a lack of flexibility in agriculture negotiations.

Textile manufacturers in my constituency and throughout the country are concerned about whether the Government are taking a sufficiently tough line on the negotiations over the phasing out of the multi-fibre arrangement. Can my hon. Friend assure the House that the Government and the European Community will take an extremely robust line to ensure that export subsidies and tariff barriers, which are holding back British exports, are done away with? British textile manufacturers are not afraid of free trade as long as it is fair trade, but we need a level playing field.

I assure my hon. Friend that we very much recognise the importance to our textile industry of better market and export opportunities because it is a successful exporting industry. He invites us to take a robust line. We are doing that in seeking reductions not only of tariff barriers but of other obstacles, including the subsidies to which he refers, so that we can create a more level playing field.

Shipbuilding

6.

To ask the Secretary of State for Trade and Industry when he last met his European counterparts to discuss shipbuilding.

My noble Friend the Minister for Industry represented Her Majesty's Government at the Industry Council on 26 November at which the seventh directive on aid to shipbuilding was adopted unanimously.

Did the Minister on that occasion raise the question of Cammell Laird, a shipyard which is crucial to the economy of the north-west of England and to thousands of workers? Did he ask for intervention aid and raise that matter with the Commissioner? People in the north-west want to know what the Government propose to do about the survival of that shipyard.

The future for Cammell Laird is not strictly relevant to the seventh directive, but I will answer the right hon. Gentleman, because this is a serious and important point. We are lucky to have such a hard-working local Member as my right hon. Friend the Member for Wallasey (Mrs. Chalker), who has been doing tremendous work trying to help the company to find orders. I also pay credit to the hon. Member for Birkenhead (Mr. Field) who, as always, takes a positive and sensible view of such matters.

The problem with Cammell Laird, as the right hon. Member for Salford, East (Mr. Orme) is aware, is that it was agreed that the shipbuilding intervention fund would not be available to Cammell Laird. We have been back to the Commission and argued the case on behalf of the company, but we received a firm no. Subsidies will not be available to the company. It would be counterproductive for me to offer any hope that the Commission is likely to change its mind.

While we do not want the Minister to offer baseless hope, will he undertake to return to the Commission and specifically raise the matter of individual orders for which the company requests intervention fund backing? Does he accept that his negotiating position has changed as the negotiations on the seventh directive have progressed? At the beginning, it looked as though the Jobs in the naval yards were secure, but it now appears that the 22,000 jobs in the naval yards will collapse to just over 8,000. On that basis, in this last month of negotiations, should not the Minister go back to the Commission and argue the British case to defend those jobs? If he fails to do that, not only will Cammell Laird suffer, but the Minister will have locked the whole of British shipbuilding into further decline.

The hon. Gentleman's first question was also put to me yesterday by my right hon. Friend the Member for Wallasey. I am prepared to give the commitment that the hon. Gentleman asked for. I will go back and ask the Commission to waive the rule for particular orders, but I must be honest and say that, so far, Sir Leon Brittan, on behalf of the Commission, has given a very firm no. However, we will try again.

Will the Minister assure us that the Government are not out of line with our European partners in relation to subvention for shipbuilding? Does he realise that the majority of our European partners would like to see subvention remain at about 20 per cent. for at least six months and then, if it must be reduced, have it reduced in a structured way and not by the massive 50 per cent. currently proposed?

I know that the hon. Gentleman takes a close interest in these matters. Indeed, he is leading a delegation to see me this afternoon. We are anxious to help Harland and Wolff in every way we can. It would be unwise for me to speculate on the outcome of negotiations that are still proceeding on the automatic degressivity of shipbuilding aid—[Interruption.] For those not familiar with European jargon, degressivity is the year-by-year cut in subsidies to shipbuilding. I repeat what I said in the debate on shipbuilding—it is extremely unlikely that aid will be cut to below the 10 per cent. margin. It will be somewhere between 10 and 20 per cent.

While the small Ferguson yard in Port Glasgow is thriving, principally because it recently signed an order with assistance from the intervention fund, the economy of the lower Clyde would be transformed if Scott Lithgow were allowed to compete successfully for orders for large ships. As that yard has been denied access to the intervention fund for more than five years, does the Minister recall the Commission's amendment, which he quoted the other day, to the effect that after five years a shipyard may be given access to the intervention fund? Will the Minister give Scott Lithgow's case the most serious consideration?

We are anxious to help our manufacturers in any way we can and I should be happy to give the most serious consideration to Scott Lithgow's case, but the general position, as the hon. Gentleman hinted, is that the Commission is absolutely firm about the rule of up to five years. However, there may be more flexibility after five years and I am happy to take up the hon. Gentleman's. suggestion and go back to the Commission.

My hon. Friend will be aware that in the past the Commission has changed the intervention rules for specific orders. May I, therefore, warmly welcome the commitment that he has given to the hon. Member for Birkenhead (Mr. Field) to go back with a specific request for intervention funds for specific orders?

The Gulf

7.

To ask the Secretary of State for Trade and Industry what assessment he has made of the trade consequences of a military option in the Gulf.

With 300 Kuwaiti oilwells detonated, tankers in the Gulf Exoceted, some Saudi and Emirate production missile-eliminated, fire trenches described to many of us by General Colin Powell in a Committee Room last night as incinerated, and the use of nuclear weapons not excluded, what then happens when the price of oil is $120 per barrel on the Rotterdam spot market? How do Ministers reply to today's Oxford survey? What happens then if there is a military option?

All that is needed to bring about a peaceful resolution of the crisis is for Saddam Hussein to obey the United Nations resolutions and to withdraw. [HON. MEMBERS: "Answer the question."] The hon. Gentleman has made clear his concern about these issues on a number of occasions and he has been answered by my right hon. and hon. Friends.

Has my hon. Friend reflected on whether a quick resolution would ensure that we returned to normal trade throughout the region? Have not the high prices brought about by the crisis reduced the consumption of oil and petrol and thus reduced the greenhouse effect that the hon. Member for Linlithgow (Mr. Dalyell) is constantly talking about?

My hon. Friend is aware that the trade consequences of what has already happened have been severe, especially on certain states in the area. The consequences of the rather volatile movements of oil prices are difficult to predict and we shall not know for a little while whether the good consequence of less oil being consumed and less sulphur dioxide in the atmosphere has been brought about. I am sure that the entire House shares the common concern that we should obtain a peaceful solution, but one which means that the United Nations resolutions have been obeyed.

Has not the Minister of State for Defence Procurement's denial of The Sunday Times Insight teams report been less than full and clear? Will the Minister——

Why did the hon. Gentleman not ask that question when I was on my feet?

On a point of order, Mr. Speaker. Those of us who were trying to listen to the supplementary question put by my hon. Friend the Member for Leyton (Mr. Cohen) had our hearing of it interrupted by a Minister of the Crown. Is it appropriate for a member of the Cabinet——

Order. I was listening carefully to what the hon. Member for Leyton (Mr. Cohen) was saying. I do not think that anything disorderly occurred. However, this matter was raised at some length on Monday.

Will the Minister publish the ministerial minutes? Is it not wholly inappropriate for a Minister to be leading the war effort who facilitated, with a nod and a wink, the sale of weapon-making equipment to the Iraqis?

Thank you, Mr. Speaker. I suggest that the hon. Gentleman reads the proceedings of the House on Monday as they appear in Hansard, when I made a statement on the issues to which he is referring and when a number of questions were answered.

On a point of order, Mr. Speaker. In view of the unsatisfactory non-reply to my supplementary question, I hope to raise the ecological consequences of the Gulf military option in a debate on the Adjournment.

Shadow Directors

8.

To ask the Secretary of State for Trade and Industry if he has received representations on the role of shadow directors as defined in the Companies Act 1989.

My hon. Friend asked about measures under the Companies Act. I have had several representations on related issues under the Insolvency Act 1986.

Is my hon. Friend aware that there is strong circumstantial evidence that a number of companies that are running into financial difficulties are being put into receivership because the banks involved are concerned about putting their own people into those companies because they might be defined as shadow directors under the Companies Act? But for that, those companies might have been saved. Will my hon. Friend assure the banks that they will not be prosecuted, provided that they are not involved in any wrongdoing?

I can give that assurance. Under the legislation to date, no banker has been successfully prosecuted for acting as a banker. Only one case has been brought under the legislation and that was withdrawn by the liquidator before being pressed to a conclusion. The reasons for that are evident in the nature of the legislation, which states that the bankers must be doing more than offering advice in a professional capacity. The courts would have to examine the consequences of any action to determine whether it resulted in wrongful trading and whether it made the position worse.

I assure my hon. Friend that it is not the intention of the legislation to frighten bankers who are acting properly, as bankers, in trying to rescue companies. Of course, such matters are subject to test in the court. I shall consider carefully the issues raised by my hon. Friend.

Is there not another group of shadowy people actively trying to mislead and misrepresent their policies? What representations has my hon. Friend received about recent statements by shadow Ministers? Will he refer them to the appropriate regulatory authority?

I wish that there was adequate legislation to deal with that serious threat. It is of great concern that the Opposition make so many misrepresentations. They claim to be the friend of industry and commerce, yet spend all their time here running it down.

Textile Industries

9.

To ask the Secretary of State for Trade and Industry if he will make a further statement on Government plans to assist the textile industries.

My right hon. Friend is seeking to improve the protection of intellectual property and to strengthen the rules and disciplines of the GATT in a way that will benefit the textile industries.

Is the Minister aware that the British textile industry is in a deep crisis? Is he further aware that in the past six months, 3,500 jobs have been lost—including 85 at the Corals factory in Leicester last Friday? Is not the Government's policy of high interest rates and their failure to tackle import penetration having a dramatic effect on the future of the industry? Will the Minister, as a matter of urgency, convene a meeting with the employers and the unions to fashion a strategy to save that vital industry before it is too late?

My many discussions with employers and unions, and my many visits within the industry, lead me to believe that the hon. Gentleman's description of the textile and clothing industry does not bear much resemblance to reality. He says that the industry is in a deep crisis, but its exports this year are 16 per cent. up on the same period last year and it is investing heavily. Naturally, we all regret job losses, but the hon. Gentleman must recognise that many of the reductions in employment are the consequences of the very investment that we all want in the industry.

As an unashamed Tory protectionist, may I press my hon. Friend about the textile industry in Leicestershire and also the multi-fibre arrangement? Will he make it absolutely clear that in no circumstances will Ministers allow the MFA to be phased out unless there are satisfactory alternative provisions under the Uruguay round?

I assure my hon. Friend that not only are we determined, as has always been the case, to ensure that strengthened rules and disciplines and better market access accompany the phasing out of the MFA, but that the benefit of those strengthened rules and disciplines and of the tariff reductions in other countries should come into effect when the Uruguay round comes into effect, which we expect to be at the beginning of 1992. The MFA will be phased out over a longish period—just a little less than 10 years—so there will be benefits to the textile industry from the beginning.

Now that the Minister has made it clear that the MFA is to be abandoned in the talks in Brussels and that the GATT rules are unlikely to be strengthened in the way the industry wants, will he take it from me that it is no use trying to suggest that criticism of the Government comes only from Opposition Members, when employees and employers alike have written condemning the Government for their lack of interest in retaining the textile industry, particularly the spinning end of it, in Britain?

I sometimes wonder where the hon. Gentleman has been for the past four years—Glasgow, perhaps. If he has only just discovered the commitment that was made not just by Britain, and not just by the European Commission, but by all the contracting parties to GATT that—as part of the Uruguay round the—MFA would he phased out and textiles, like all other commodities, would be brought within the general rules of world trade, I wonder how much interest he really has in the industry.

Is my hon. Friend aware that despite considerable improvements in production processes in the textile industry in Leicestershire, there is still a belief throughout the county that a 10-year multi-fibre arrangement is essential? Will he comment further on the threat to British markets of illegal subsidies in India and Pakistan, which is of particular concern?

I appreciate my hon. Friend's concern for the industry. A good example of the benefits of the Uruguay round is that newly industrialised countries that have been using subsidies, in our view improperly, have agreed to phase out those subsidies in the event of a successful outcome of the Uruguay round. That will be of great benefit to the textile industry and to industry generally. That is one reason why we are determined to obtain a successful outcome and a commitment to phase out the MFA is an essential part of that.

The textile and clothing industry trade association, the Apparel, Knitting and Textiles Alliance, has expressed in a letter to all Members of Parliament its profound concern that the Government are trying to weaken the EC's position in the GATT and the MFA talks. Will the Minister today, in taking the robust line to which he referred earlier, allay those concerns by giving a clear commitment that any phasing out of the MFA will be conditional on a safeguard clause and new regulations on anti-dumping, the protection of intellectual property and reciprocity in terms of open markets in countries closed by excessive tariffs?

I hope that we can be assured that the Opposition share our view that our economy and, indeed, that of the world, would benefit from a more open trading system—a view which the hon. Member for Nottingham, North (Mr. Allen) clearly shares. I therefore hope that they will support our objective of a successful outcome to the Uruguay round, which requires that we deliver on the commitment to bring trade in textiles within the general rules covering all other trade. As we have always said, that must be accompanied by strengthened rules and disciplines in the GATT system covering matters of the kind to which the hon. Gentleman referred.

Will my hon. Friend ensure that the United States Government are left in no doubt about our attitude to the protectionism that they afford to their textile industry? Does he agree that tariffs of well above 30 per cent. not only act as a severe barrier to our exports but lead to the diversion of trade into our markets, which are far more vulnerable to dumping and other unacceptable practices?

I assure my hon. Friend that I personally, my right hon. Friend the Secretary of State and all those negotiating on our behalf have made it clear to the United States that we regard it as unacceptable for a country such as the United States to shelter an industry behind tariffs as high as those to which my hon. Friend referred and that we also regard as unacceptable the offer that the United States has made so far for reducing textile tariffs.

Weapon Components And Research

10.

To ask the Secretary of State for Trade and Industry what new initiatives he plans on the international trade in conventional, nuclear, biological and chemical weapon components and research information.

We continue to work with other like-minded countries to take effective action to prevent the proliferation of missiles and nuclear, biological and chemical weapons and to control the export of conventional weapons. In the light of recent developments, my right hon. Friend the Secretary of State has decided to extend the controls on the export of chemical weapons precursors and on chemical plant and equipment for use for chemical weapons purposes.

I thank the Minister for that answer. Will he confirm that such measures have proved so successful in the past that if war breaks out in the Gulf British soldiers will be bombarded with howitzer and mortar shells manufactured using machinery exported from Britain, spied on by British-made radar, shot at by tanks travelling on British tracks, and attacked by missiles propelled by British fuel, all supplied to Saddam Hussein with the help and guidance of British Ministers? Can the Minister give an absolute guarantee that potential future Saddam Husseins are not even now being armed to the teeth by Britain?

I can give the hon. Gentleman an undertaking that we have one of the world's strictest systems of controlling the export of defence equipment. Furthermore, we adhere strictly to our treaty commitments, which cover the export of nuclear material, and we intend to continue doing so.

Does my hon. Friend agree that the Government have effectively controlled export licences for goods which could be used for military purposes, to the extent that that has had an effect on some companies in my constituency, which had export licences refused to them? Should not those who have evidence to the contrary seek recourse to the law—rather than knock British industry, as Opposition Members do, for cheap party political gain?

I very much agree with my hon. Friend. I assume from the attitude taken by some Labour Members that they would like to ban all defence exports, which would immediately put at risk, if not immediately destroy, at least 100,000 jobs.

In view of the new-found confidence in the United Nations, which is shared by the British Government, will the Minister look with favour on the proposal, which has the support of Germany's Foreign Minister in particular, for the United Nations to maintain a register of all arms sales?

As the hon. and learned Gentleman knows, that idea has been around for a long time. If such a scheme were to be effective, it would require universal adherence—and that does not yet seem to be obtainable.

Insider Dealing

11.

To ask the Secretary of State for Trade and Industry what steps he proposes to take in the light of the reaction to his consultation document "The Law on Insider Dealing".

The Government are currently considering the responses to the consultative document, and we will bring forward legislation when parliamentary time permits.

Does my hon. Friend agree that although insider trading is difficult to prove—as evidenced by just nine successful prosecutions in the past 10 years, not one of which attracted a prison sentence—we ought to strengthen the armaments against insider dealing by, for instance, introducing civil law penalties on the lines suggested by the Select Committee on Trade and Industry as well as by the chairman of the Securities and Investments Board, a remedy which is widely used in the United States?

I cannot agree that we have been unsuccessful in pursuing insider dealing in recent years. Out of 21 cases taken to court, convictions were secured in 12 of them, involving 14 defendants. The Government intend to prosecute any case in which good evidence exists. In sifting through the consultation replies, we shall take on board all sensible advice from whatever source. There may need to be a strengthening of our law in some respects, to bring it into line with the directive—which, for example, seeks to create an offence for insider dealing in Government and local authority securities, which is not covered by existing British law.

Does my hon. Friend agree that the panoply of legislation that the Government have brought to bear on the whole question of insider dealing and regulation of the City shows that the Government care about that area of activity and about regulating it properly, in contrast with the Opposition's lamentable failure to do any such thing when in office? Does he agree that the financial practices of the National Union of Mineworkers, Liverpool city council and other Labour authorities give one no confidence that the Opposition would tackle the subject in the future?

My hon. Friend makes his point extremely well. There are worries about financial probity in a number of organisations. The Government intend to use the full force of the law wherever they can do so to root out those malpractices. It is a sad testimony to the Opposition, who are always on about insider dealing, that when they had the power to bring proposals before the House, they did not do so. In contrast, the European directive was in large measure influenced by the legislation that the Government put through the House earlier in their period in office.

Brewing Industry

12.

To ask the Secretary of State for Trade and Industry what representations he has received from the Director General of Fair Trading on the implementation of Government regulations on the brewing industry.

The director general is monitoring compliance with the Supply of Beer Orders and he has not so far advised me that any change is necessary.

Does the Minister realise that many people in the industry are worried about the apparent climb-down by the Government on the brewing industry question? Will the Minister ask the Office of Fair Trading to monitor what are known as swap arrangements in the industry, or is he too mindful of the brewers' donations to the coffers of the Tory party?

The director general has powers to monitor arrangements. If the hon. Gentleman has evidence that he thinks the director general ought to see to help him carry out his task, I suggest that he sends it to him or to my office.

With the closure of the largest regional brewer, Greenall Whitley, and with other regional brewers possibly following suit, is not something going very wrong with the structure of the industry? Should not the Monopolies and Mergers Commission reconsider the matter urgently?

The director general is keeping the industry under review and he also has powers to advise my right hon. Friend about any transaction or merger which he thinks might be damaging to the public interest and should be referred to the Monopolies and Mergers Commission. My hon. Friend the Member for Warrington, South (Mr. Butler) has been doing an extremely good job for his constituency and the interests of the brewery there, and I have helped him to forward evidence to the director general, who will be advising us and my hon. Friend in due course.

Steel Industry

13.

To ask the Secretary of State for Trade and Industry whether he has any plans to meet the chairman of British Steel to discuss the future of the steel industry.

My right hon. Friend meets the chairman of British Steel whenever appropriate. Their last meeting was on 7 September and there are no plans for a further meeting at this stage. My noble Friend the Minister for Industry visited British Steel at Port Talbot last week.

Will the Minister persuade his right hon. Friend to meet the chairman of British Steel to discuss the constructive alternatives being proposed by the work torte at Ravenscraig and Clydesdale? Is not it disgraceful that a man known as "Black Bob", because he has dug so many industrial graves, is refusing to meet the work force to discuss the future of the industry in Scotland and the rest of the United Kingdom?

Labour Members are always quick to talk down the management of British Steel. Perhaps we should consider the record of British Steel, which is now ma king a profit of £700 million a year, compared with an operating loss of £1·7 billion under the last Labour Government. It is not surprising that the hon. Member for Dunfermline, East (Mr. Brown), the shadow spokesman on trade and industry, said at the party conference that the British steel industry is now the most efficient in Europe.

I support the hon. Gentleman's plea for my right hon. Friend to meet the chairman of British Steel. Could he use the opportunity to persuade the chairman to offer the assets of British Steel in Scotland for sale to any interested party, as an integrated whole, before they are chipped away and destroyed under the current management of British Steel?

My right hon. Friend will know that: my right hon. Friend the Secretary of State for Scotland has said that closure is a matter for the commercial judgment of the company concerned, and that remains the Government's position. My right hon. Friend the Secretary of State for Scotland asked the Scottish Development Agency to consider the implications of the closure for the work force. I mentioned the visit of my noble Friend the Minister for Industry to Port Talbot, and British Steel's record in terms of profitability. As my noble Friend is a helpful sort of Minister, he asked them, "What can I do to help?" The management said quite clearly, "Keep out of our business."

The Minister seems totally unconcerned that time is running out for the Scottish steel industry. Does he agree that the Government should step up the search for an overseas buyer for Clydesdale? Will he tell us exactly what Ministers have done to deal with the steel crisis in the six months since the strip mill closure was announced? Now that we have had a change of Prime Minister, is not it time for a change in steel policy—time for action rather than platitudes?

The steel policy that has been maintained by the present Government for 10 years has resulted in a company which 10 years ago was making a loss of £1·7 billion now making a profit of £700 million a year. Why should Ministers such as I be better at picking winners and deciding how to operate British Steel than the directors who have been so successful in turning British Steel into a profitable company?

Bills Presented

Children And Young Persons (Protection From Tobacco)

Mr. Andrew Faulds, supported by Mr. Alan Amos, Mr. Joe Ashton, Mr. Tom Cox, Mr. Jerry Hayes, Mrs. Maureen Hicks, Mr. Norman Hogg, Mr. John Home Robertson, Miss Joan Lestor, Mr. Archy Kirkwood, Mr. Stever Norris and Mr. Roger Sims, presented a Bill to increase the penalties for the sale of tobacco to persons under the age of 16 years; to make illegal the sale of tobacco to such persons from vending machines; to require local authorities to enforce those provisions and publish reports; to prohibit the sale of unpackaged cigarettes; to prohibit the advertising of tobacco or tobacco sponsored events from retail premises; to require the publication of warning statements on cigarette packages and in retail premises; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 18 January and to be printed. [Bill 19.]

Pig Husbandry

Sir Richard Body, supported by Teddy Taylor, Mr. Harry Greenway, Mr. Gary Walker, Mr. Christopher Hawkins, Mr. Bill Walker, Mr. Andrew Bowden, Mr. Austin Mitchell, Mr. Chris Mullin, Mr. Robin Corbett, Mr. Ron Davies and Mr. Matthew Taylor, presented a Bill to prohibit the use of neck and girth tethers on breeding sows; and to prohibit the confinement of breeding sows in narrow stalls: And the same was read the First time; and ordered to be read a Second time on Friday 25 January and to be printed. [Bill 20.]

National Health Service (Compensation)

Mrs. Rosie Barnes, supported by Mr. Jack Ashley, Mr. John Cartwright, Mr. Tom Clarke, Mr. Frank Field, Ms. Harriet Harman, Mr. Charles Kennedy, Mr. Archy Kirkwood, Sir Michael McNair-Wilson, Mr. Alfred Morris, Dr. David Owen and Mrs. Ann Winterton, presented a Bill to provide that persons injured, distressed or subjected to unnecessary pain or suffering during care by the National Health Service may be awarded compensation without having to prove negligence on the part of the National Health Service; to define eligibility for compensation; to establish a Medical Injury Compensation Board and to make other provision for the assessment of eligibility and payment of compensation; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 1 February and to be printed. [Bill 21.]

Public Safety Information

Mr. Steve Norris, on behalf of Mr. John Bowis, supported by Mrs. Gwyneth Dunwoody, Mr. Dafydd Wigley, Mr. Simon Hughes, Mr. James Arbuthnot, Mr. Roger Stott, Ms. Dawn Primarolo, Mr. Andrew Mitchell, Mr. Dudley Fishburn, Mr. John P. Smith and Mr. Ian Taylor, presented a Bill to give certain bodies duties regarding information concerning public safety; to require the designation of a public safety officer by such bodies; to provide for the keeping of registers of such information; to provide for public access to that information; and for related purposes: And the same was read the First time; and ordered to be read a Second time on Friday 8 February, and to be printed. [Bill 22.]

Badgers

Mr. Roy Hughes, supported by Mr. Ron Davies, Mr. Andrew Mitchell, Mr. Robin Corbett, Mr. John Bowis, Mr. Donald Coleman, Mr. Andrew MacKay, Mr. Richard Livsey, Mr. Tony Banks, Mr. Steve Norris, Mr. Paul Murphy and Mr. Gary Waller, presented a Bill to make provision for the protection of badger setts; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 15 February and to be printed. [Bill 23.]

Courts (Research)

Dr. Mike Woodcock, supported by Mr. Humfrey Matins, Mr. Roger King, Mr. Barry Porter, Mr. Gerald Bermingham, Mr. David Evennett, Mr. Ian Bruce, Mr. Keith Vaz, Mr. Michael Knowles and Mr. Gareth Wardell, presented a Bill to make provision for research covering the televising of proceedings in court; and for research concerning trial by jury; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 22 February and to be printed. [Bill 24.]

Estate Agents (Property Misdescriptions)

Mr. John Butcher, supported by Sir Robert McCrindle, Mr. David Evans, Mr. Lewis Stevens, Mr. Douglas French, Mr. Simon Hughes, Mr. Alan Williams and Mr. Austin Mitchell, presented a Bill to prohibit the making of false or misleading statements by persons carrying out estate agency business in connection with property transactions: And the same was read the First time; and ordered to be read a Second time on Friday 1 March and to be printed. [Bill 25.]

Domestic Smoke Alarms

Mr. Conal Gregory, supported by Mr. Stuart Bell, Mrs. Rosie Barnes, Mr. Alistair Burt, Dame Janet Fookes, Mr. Douglas French, Mrs. Alice Mahon, Mr. Ian McCartney and Mr. Patrick Thompson, presented a Bill to require the installation and maintenance of smoke alarms in private dwelling houses; to provide for financial assistance in certain cases; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 25 January and to be printed. [Bill 26.]

Radioactive Material (Road Transport)

Mr. Dudley Fishburn, supported by Mr. Neville Trotter, Mr. John Bowis, Mr. Chris Butler, Mr. Matthew Carrington and Mr. Ted Garrett, presented a Bill to make new provision with respect to the transport of radioactive material by road; to repeal section 5(2) of the Radioactive Substances Act 1948; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 18 January and to be printed. [Bill 27.]

Registered Homes (Amendment)

Mr. John Butterfill, supported by Mr. David Hinchliffe, Sir Peter Blaker, Mr. A. J. Beith, Sir David Price, Mrs. Rosie Barnes, Sir Robert McCrindle, Mr. Dafydd Wigley, Mr. Steve Norris, Mr. Frank Field, Mr. David Evans and Mr. Barry Field, presented a Bill to amend Part I of the Registered Homes Act 1984 so as to require registration in respect of small residential care homes; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 8 February and to be printed. [Bill 28.]

Trade Descriptions (Animal Testing)

Mr. Joe Ashton, supported by Dame Janet Fookes, Mr. Terry Lewis, Mr. Simon Hughes, Mr. Tony Banks, Mr. Steve Norris, Mr. Stan Crowther, Mr. Robin Corbett, Mr. Peter Hardy, Mrs. Ann Clwyd and Mr. Andrew Bowden, presented a Bill to require an indication to be given if specified goods have been tested upon animals; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 8 February and to be printed. [Bill 29.]

Crofter Forestry (Scotland)

Mr. Calum Macdonald, supported by Mr. Brian Wilson, Mr. Alick Buchanan-Smith, Mr. Charles Kennedy, Mr. John Home Robertson, Mr. Elliot Morley, Sir Hector Monro, Mr. Andrew F. Bennett and Mr. James Wallace, presented a Bill to extend the powers of grazings committees in relation to the use of crofting land in Scotland for forestry purposes; and to make grazings committees eligible for certain grants in respect of such use: And the same was read the First time; and ordered to be read a Second time on Friday 15 February and to be printed. [Bill 30.]

Road Traffic (Temporary Restrictions)

Mr. William Cash presented a Bill to make new provision in place of sections 14 and 15 of the Road Traffic Regulation Act 1984; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 22 February and to be printed [Bill 31.]

Local Government Finance (Publicity For Auditors' Reports)

Mr. Michael Mates presented a Bill to make further provision with respect to the furnishing or making of copies, and inspection, of auditors' immediate reports made under section 15(3) of the Local Government Finance Act 1982: And the same was read the First time; and ordered to be read a Second time on Friday 1 February and to be printed. [Bill 32.]

Employment (Upper Age Limits In Advertisements)

Mr. David Winnick, supported by Mr. Jeremy Corbyn, Mr. Terry Davis, Mr. George Foulkes, Mr. Greville Janner, Mr. Ron Leighton, Mr. Geoffrey Lofthouse, Ms. Marjorie Mowlam, Ms. Joyce Quin, Ms. Joan Walley and Mrs. Audrey Wise, presented a Bill to prohibit the use of upper age limits in the advertising of employment vacancies: And the same was read the First time; and ordered to be read a Second time on Friday 18 January and to be printed. [Bill 33.]

Motor Vehicles (Safety Equipment For Children

Mr. Michael Jopling, supported by Sir Michael Shaw, presented a Bill to make provision in relation to safety equipment for children in motor vehicles: And the same was read the First time; and ordered to be read a Second time on Friday 15 February and to be printed. [Bill 34.]

Criminal Procedure (Insanity And Unfitness To Plead)

Mr. John Greenway, supported by Mr. Jack Ashley, Mr. David Bellotti, Mr. Alistair Burt, Mr. John Cartwright, Mr. Kenneth Hind, Mr. leuan Wyn Jones, Mr. Austin Mitchell, Mr. Eddie O'Hara, Mr. Andy Stewart and Mr. Peter Temple-Morris, presented a Bill to amend the law relating to the special verdict and unfitness to plead; to increase the powers of courts in the event of defendants being found to be insane or unfit to plead; and to provide for a trial of the facts in the cases of defendants found to be unfit to plead: And the same was read the First time; and ordered to be read a Second time on Friday I March and to be printed. [Bill 35.]

Wildlife And Countryside (Amendment)

Mr. Donald Coleman, supported by Mr. Ron Davies, Mr. Peter Hardy, Mr. Roy Hughes, Mr. Elliot Morley, Mr. Geraint Howells, Dr. Dafydd Elis Thomas, Mr. Martyn Jones, Sir Anthony Meyer, Mr. John Bowis, Mr. Andrew F. Bennett and Mr. Gareth Wardell, presented a Bill to amend sections 5 and 11 of the Wildlife and Countryside Act 1981 so as to make it an offence to cause or permit the commission of offences under those sections: And the same was read the First time; and ordered to be read a Second time on Friday 25 January and to be printed. [Bill 36.]

Parish Councils (Access To Information)

Mr. Roland Boyes, supported by Mr. Kevin Barron, Mr. A. J. Beith, Mr. George J. Buckley, Mr. Patrick Cormack, Mr. Cecil Franks, Mrs. Llin Golding, Mr. Frank Haynes, Mr. Martyn Jones, Mr. David Knox, Mr. Keith Mans and Mr. Martin Redmond, presented a Bill to provide for greater access by the public to meetings of parish councils and community councils, and to certain documents and information relating to parish councils, parish meetings, community councils and community meetings; and for related purposes: And the same was read the First time; and ordered to be read a Second time on Friday 22 February and to be printed. [Bill 37.]

Aircraft (Noise Restriction)

Mr. Terry Davis presented a Bill to make provision with respect to permissible noise levels of civil aircraft operating to and from airports in the United Kingdom; to place upon the Secretary of State a duty of licensing civil aircraft in respect of engine noise levels; to impose restrictions on civil night flying; to increase the extent and scope of noise insulation grants; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 1 February and to be printed. [Bill 38.]

Opposition Day

[IST ALLOTTED DAY]

Poll Tax

I have selected the amendment in the name of the Prime Minister. Furthermore, in view of the large number of hon. Members who wish to participate in the debate, I propose to impose a 10-minute limit on speeches between 6 and 8 pm. I hope that those who may be called either before or after those times will bear in mind that general limit.

3.35 pm

I beg to move,

That this House asserts that experience has shown beyond doubt that the poll tax is objectionable in principle and unfair and unworkable in practice; concludes that the problems it creates for local taxpayers and for local government cannot be overcome and are getting worse; notes the recent denunciation of the poll tax by many senior members of the Government including the new Secretary of State for the Environment; and urges the Government to have the courage of its changed convictions by recognising that the poll tax is beyond redemption and must be abolished.
I begin by welcoming the right hon. Member for Henley (Mr. Heseltine) back to the Dispatch Box and to his new, and perhaps resumed, responsibilities. I offer him a particularly warm welcome to that bed of nails, the poll tax. The right hon. Gentleman's appointment shows that the new Prime Minister, whatever his other qualities, at least has a sense of humour—to be fair, not grey but black humour—although the right hon. Gentleman may have difficulty in seeing the joke. The issue which he made the centrepiece of his election campaign and which was to sweep the right hon. Member for Huntingdon (Mr. Major) to victory in the Tory leadership election has been used by his conqueror to shackle him to his failure. He is the first turkey trussed for Christmas this year—indeed, if it is not too indelicate to say so, a turkey stuffed on this occasion with a well-seasoned poll tax stuffing.

The right hon. Gentleman nevertheless deserves some credit. He alone of all the senior Conservatives dared to tell the truth about the poll tax. His denunciations carried conviction because they were true. He had the courage, and he alone had the freedom, to speak out. Where he went, the others dared not refuse to follow. If it were not for the right hon. Gentleman, I have absolutely no doubt that we would still be faced today from that Dispatch Box with the same mealy-mouthed protestations about the poll tax's unfailing virtues. Less than a month ago, the right hon. Gentleman's predecessor assured us that the poll tax review was over, that nothing more remained to be done. Once the right hon. Gentleman had dared to speak out, those deceptions could no longer be sustained. Even the right hon. Member for Bath (Mr. Patten)—now at least freed from the responsibility of defending the indefensible—has at last been persuaded to confess that the poll tax is a bomb which has to be unpicked.

We cannot, however, be too generous to the new Secretary of State for the Environment. He discovered the truth, or at least decided to act upon it, very late in the day. He happily supported the legislation that inflicted the poll tax on Scotland. At no stage did he vote against the principle of the poll tax in England. During the 1987 election campaign, he made it clear that he would not criticise the poll tax on any occasion, thereby putting party advantage above truth and principle.

The hon. Gentleman is entitled to his bit of fun. As one of those who voted against the poll tax on Second and Third Reading, and throughout, may I plead with the hon. Gentleman—it is a plea that I shall also make to my right hon. Friend the Secretary of State for the Environment—to agree with me that income tax is not a controversial issue, that it is accepted to be a fair tax? Does he not think that we in this House, on both sides, could and should try to find a form of local government finance that is not a partisan matter—one that can be accepted and seen by the people of this country to be a fair and reasonable attempt by the House to establish an acceptable form of local government taxation?

The hon. Gentleman's intervention is interesting and constructive. It is a measure of the mess into which the Government got themselves that I believe that they are now incapable of pursuing the course that he rightly recommends. As I shall show, all the sensible options have now been excluded by senior members of the Government. The only sensible option—the one that we have adopted—is now the one least likely to be accepted, because we are there already.

The new Secretary of State's record is patchy, but it is one of shining foresight and perception when compared with that of his right hon. Friend the new Prime Minister. From his earliest days in the House, the Prime Minister revealed himself as being among the strongest supporters of the poll tax. In government, he was deeply involved, as Chief Secretary and then as Chancellor, in the development of the poll tax from his membership of the Committee that first decided to abandon the phasing in of the poll tax in favour of overnight introduction, through his preparation of the package that fought off the revolt that might have carried the amendment of the hon. Member for Hampshire, East (Mr. Mates). During an interview on "On the Record" he confirmed his intimate involvement in the most recent but now apparently inadequate fundamental review. Earlier this year, he was still at it, assuring a constituent that the poll tax
"will be seen to be a very much fairer and more acceptable system."
The right hon. Gentleman's only real attempt at fundamental reform came in his Budget earlier this year, but that was totally flawed by the fact that he forgot about Scotland—a recurring theme in the poll tax saga—and miscalculated the number of beneficiaries and the extent to which they would benefit. No wonder the Prime Minister has been a late convert to the idea that the poll tax is now indefensible. Even when the need to move in the quest for votes for the leadership became clear to him just a week or so ago, he revealed that he had very little idea of what steps could or should be taken. In an interview in the Daily Mail on 24 November he said, memorably:
"I don't know what we'll have to do and neither does anyone else"—
the smack of firm government if ever I heard it.

The new Secretary of State has no such difficulty. His problem is a different one. He has no shortage of ideas but a superfluity of them. He is a man who believes six impossible things before breakfast. Ideas spin off the top of his head without thought, preparation or costing. They are all mutually contradictory and unworkable and are all cheerfully abandoned in turn as new ideas occur to him. As the Prime Minister acidly observed:
"reforms cannot be entertained until they have been prepared, examined, costed and considered."
Those are all things that the right hon. Gentleman has failed to do. There is no such caution for the new Secretary of State.

On 10 May, the right hon. Gentleman set out his stall in an ill-considered article in The Times. The ideas that he put forward on that occasion, including his revival of his 1981 peculiarity that there should be a referendum every time a council budget departs from the Government's view, were so bizarre that they were laughed to scorn. The right hon. Gentleman had to run for cover, and not a peep was heard from him for three months. When he finally resolved to enter the fray, surprise, surprise, he had a totally different agenda and a new set of ideas that were equally unworkable and ill thought out.

Will the hon. Gentleman put the matter in the context of the Opposition's approach, which, as he knows, has produced no fewer than 65 changes of Front-Bench opinion since spring 1987? Were all those proposals costed, too?

I shall come to that a little later. I am sure that the hon. Gentleman is not unaware of the existence of the excellent document, published at the end of July, setting out our proposals and available from Walworth road at £1·50 per copy. It has been selling well.

The real problem that the Secretary of State faces, however, is that each of his ideas has been categorically slapped down by the man who is now his leader. "Transfer education," he said, "from local to central Government." He suggested that on 14 November, but that idea was torpedoed by the then Chancellor two days later. He said:
"Resources pre-empted by shifting education spending to central government could not be spent on health, pensions, defence or other proper claims on the public purse."
The right hon. Gentleman needed not have bothered: the present Secretary of State had already provided the answer himself. In that same ill-judged article of 10 May, he had written that if such a step were taken,
"the Government might find itself blamed for poor standards and income tax might have to rise."
By 15 November, just a day after the Secretary of State had floated his ill-considered proposal, he was already backtracking, describing it as "a fallback position".

What about abandoning the flat rate principle in favour of banding? The present Secretary of State has spoken in favour of it—indeed, he voted in favour of it. In 1988, the then Chancellor condemned that proposal as having

"deep and damaging flaws that would introduce a whole range of unfairnesses and anomalies that could not be defended."
What about the realistic grant settlement that the Secretary of State advocated in his article on 10 May? There was very little chance of that, I am afraid, when the Prime Minister was still at the Treasury. It was under his regime that local government was again short-changed by central Government grant. The burden is again scheduled to fall on poll tax payers and, as a consequence of that gap, the poll tax bills will rise comfortably—perhaps I should say "uncomfortably"—above the Government's estimate of their likely level.

The problems that the Secretary of State faces do not arise solely from the fact that he has been systematically contradicted by his own Prime Minister. He also has problems with his ministerial team. The Minister for Local Government and Inner Cities was, we all recall, appointed to that position to act as a minder for the then Secretary of State. He was a member of the Stasi, in my preferred phrase—someone put there to ensure that there was no backsliding from the sacred principle. He alone still appears to have the courage of his party's former convictions. Less than two months ago, he was asserting to the Tory party conference—admittedly to a less than enthusiastic reception—that the poll tax,
"far from being a vote loser, will be a vote winner and will launch us on a fourth term."
I am sure that the hon. Gentleman is delighted to hear his words repeated. Just a month later, he was confidently assuring anyone who would listen that the poll tax "review is now complete", implying that all wrinkles had been ironed out and all the problems solved.

The hon. Gentleman is not alone. It turns out that the new Under-Secretary of State for the Environment, the hon. Member for Suffolk, Salisbury (Mr. Key), is also a secret admirer of the poll tax. Just two days ago, he almost burbled with enthusiasm when he was asked whether he supported the flat rate principle of the poll tax. In response to the challenge from my hon. Friend the Member for Sheffield, Brightside (Mr. Blunkett), he made it very clear that he was nailing his colours to the mast of that sinking flagship. There is not much evidence in the ministerial team of reforming zeal or commitment to a fundamental review.

But the Secretary of State's problems do not stop there. Contradicted by his Prime Minister, by other senior members of the Cabinet and by his own Ministers, the right hon. Gentleman has also succeeded in contradicting himself. On 10 May, he proclaimed that capping, as a solution to the problem of the poll tax,
"would negate accountability and be an act of centralised political power outside our experience."
However, just two days ago, in his first act in the House as the newly appointed Secretary of State for the Environment, the right hon. Gentleman presented a Bill, for which he then proceeded to vote, which turned the capping screw down even tighter. What hope do we have of a little consistency or firmness of purpose from the Secretary of State?

While we are on the subject of differences of view among colleagues, is the hon. Gentleman aware that his hon. Friends the Members for Copeland (Dr. Cunningham) and for Birmingham, Perry Barr (Mr. Rooker) refused categorically to defend the rating system during the Committee stage of the Local Government Finance Act 1988? Since the hon. Gentleman has the Labour party's document with him, perhaps he can tell us from his little booklet—he does not tell us in the motion—Labour's preferred alternative to the community charge.

I can well understand why the hon. Gentleman is so anxious to deal with the issue of the poll tax, since it seems likely to prove to be his nemesis when the general election comes. It is precisely because we recognise that the old rating system had some deficiencies—although they pale into insignificance by comparison with the poll tax—that we are proposing a fair, modernised rating system that is brought up to date arid made relevant to today's conditions.

No, I shall not give way at the moment.

I was dealing with the options that have now been closed to the right hon. Member for Henley. Where do we go from here? The right hon. Gentleman may yet surprise us all. He may have up his sleeve a solution that no one has yet thought of—a solution that will leave intact the principle of the poll tax, that will make no demands on public spending but will reduce poll tax bills across the board. As a very wealthy man, perhaps the right hon. Gentleman intends to pay everyone's poll tax bill himself.

However, in reality, there is only one sensible solution. We know—because we have traversed this ground ourselves—that that solution is to restore a property-based tax, to bring it up to date and to make it fairer by linking it to the ability to pay. That is the solution that we advocate in this excellent statement in which we set out the details of our proposals. It enables us to do what the Government should have been doing all along. Instead of going off down the disastrous byway called the poll tax, we should have started with a system that we knew would work, brought it up to date, modernised it and made it fairer wherever possible and in stages.

Incidentally, that solution appears to commend itself to The Times, which does not normally support the Labour party. It commends itself also to no less than Mr. John Chatfield, the chair of the Tory-controlled Association of County Councils, who said on 24 November:
"elements of Labour's plan to abolish the poll tax and return to the rates could be an improvement."
That solution also seems to commend itself to and to attract the support of the former Chancellor of the Exchequer, the right hon. Member for Blaby (Mr. Lawson). It is that one solution——

No. I have given way enough for the moment; I want now to proceed with my speech, because many other hon. Members wish to participate.

It is that one solution, set out in our fair rates proposal, which would require virtually everyone in the senior reaches of the Tory party to eat his words. It is for that single, bad reason——

I hope that the hon. Gentleman is not seeking to make an intervention under the guise of a point of order, because many other hon. Members wish to speak.

On a point of order, Mr. Speaker. Is it in order in the House for an hon. Gentleman—[Interruption.]

Is it in order for a Front-Bench spokesman to refer to a document that does not come from the House, as I understand it, is not in the Library and to which Hansard cannot refer? Should it not be read into the record?

Documents that are not in the Library are frequently referred to. I thought that I understood the hon. Member for Dagenham (Mr. Gould) to say that the document was available for £1·50.

Spurious points of order are always the last refuge of those who know that they are losing the argument. It is interesting that the Tory party, which for so long demanded to know our alternative, is now so embarrassed because we can show it a workable solution.

I shall not give way any more.

That one solution would require virtually everyone in the Tory party to eat their words, and for that single, bad reason, it is probably the one solution that is unlikely to be adopted. We shall have to wait for a Labour Government before sense can prevail. In the meantime, the Secretary of State is trapped. A Government who care nothing for the chaos and misery they have caused are at last compelled, by the need to save their own skin, to concede that they have made a terrible mistake. Every day that goes by makes that mistake more calamitous, but the Government and the Secretary of State cannot muster a single sensible idea between them about what should be done about it. They cannot even summon up the courage to face the truth: the poll tax is beyond redemption and must be abolished.

The British people will not be fobbed off any longer with further promises of reviews and changes. The Government's policy means that there are always solutions tomorrow, but real and painful problems today. The British people will say, with justice, "The Government have had 11 or 12 years to get the poll tax right; we now know that the truth is that the poll tax will never be right." When the poll tax bills arrive next spring, that will be the final proof—if it is then needed—that the old problems still remain, nothing has changed and the Government remain too arrogant to recognise a mistake in prospect and too weak and divided to correct that mistake when it is brought home to them.

The crisis becomes daily more urgent. The delays and confusion are crippling local government—not a matter that concerns the Conservative party very much. However, the uncertainty about what the revenue support grant should be and what further changes might be made in the poll tax make proper budgeting impossible and imposes an intolerable burden on local authority treasuries. Every day of continued confusion accelerates and exacerbates the already serious problems of collection that are crippling administrations in so many parts of the country.

There is only one thing—[Interruption.]

Order. Pointing across the Chamber encourages rather than discourages disturbance. Let us settle down and listen to the debate.

I intend to put the Conservative Members out of their misery promptly. They do not like to hear the truth, which is that there is only one thing that the Secretary of State should do to meet the poll tax crisis on his return to the Dispatch Box: commit himself and the Government to abolishing the poll tax and tell us clearly what is to be put in its place. Nothing else will do.

3.59 pm

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

"congratulates the Prime Minister and the Government for their decision to undertake a careful and fundamental review of the community charge; and deplores the fact that despite several unsatisfactory attempts, the Labour Party has failed to come forward with any clear or workable proposals of its own.".
My right hon. Friend the Prime Minister has described the Government's review of the community charge which he has invited me to lead as very thorough, very constructive and very fundamental. It is time to raise the whole tone of this debate—[Interruption.] I hope that the Labour party will not rule itself out of our continuing discussions.

The debate is not about who pays how much in each local authority. The issues——

The issues involved far exceed the precise financial impact on particular groups or constituencies of this or that local tax. The heart of the matter is the future relationship——

No.

The heart of the matter is the future relationship between central and local government, and the relationship that local government will have in its turn with its local community, in the fullest sense.

These relationships go to the heart of the sort of society that we have and want to have. I make no apology for putting that issue before the House. The question of the proper relationship between central and local government has lurked beneath the surface of policy making in successive Governments for the past quarter of a century. I believe that it is widely recognised that in those 25 years we have not been able to bring ourselves to look at the structure and finance of our local government as two sides of the same coin.

The time has now come to address both issues together.

In seeking to improve standards, central Government have begun to change attitudes to the pursuit of value for money, significantly by the establishment of the Audit Commission, but Government have yet to see sufficient progress in raising the quality of services that many local authorities deliver. In advocating accountability, successive Governments have not dealt with the structural and functional weaknesses to make accountability a reality.

We will not solve this problem unless we are prepared to recognise the proper partnership between the different parts of our democratic system——

—and my first purpose must be to try to bring that about. I shall begin with the Opposition parties.

Before the Secretary of State goes off on a detour, perhaps he will save us all a great deal of time and trouble by answering the single question that is in the minds of millions of poll tax payers. Will he now commit himself to abolishing the poll tax—yes or no?

There is a certain—[HON. MEMBERS: "Yes or No?"] There is a certain quaintness about the fact that the hon. Member for Dagenham (Mr. Gould) has not been able to answer any questions in three years, but he thinks that I will give him a yes or no answer in three days. [HON. MEMBERS: "Yes or No?"] Let me help the hon. Member for Dagenham and the Labour party.

I shall start with the Opposition parties. If Opposition Members could bring themselves——

Order. The hon. Member for Midlothian (Mr. Eadie) is an experienced Member, and he knows that, as the Secretary of State has not given way, he must resume his seat. There is no point in persisting.

If Opposition Members could bring themselves to do so, I should like to take this matter beyond the narrow bounds of party political conflict. The country wishes us to try to identify a stable and just basis for the future development of local government and the provision of local services. I should like to explore with the Opposition parties the extent to which we can establish common principles for the future role and direction of local government. [Interruption.] The country will not have lost sight of the fact that, when we offer to discuss these matters, all we get is baying and divisiveness. [Interruption.]

Order. This debate is of great interest not only to every hon. Member in the House but to many other people outside who may well be listening to it. If this din continues, they will not be able to hear it.

What I could hear from the Opposition was not worth hearing.

I hope that the Opposition will take my proposal seriously, because it might help them in a material way. If they were prepared to enter into dialogue, it might help them to clear their own minds about the answers to questions that have escaped them for so long. I hope that local authorities will recognise that they have an important role to play. They too must help to improve the climate in order to allow these essential developments to flourish.

Perhaps there was so much noise that the Secretary of State did not hear the question that was posed earlier. Will he answer yes or no about whether he will commit himself to the abolition of the poll tax? That is an easy question. Why does the right hon. Gentleman dodge it?

The hon. Gentleman clearly heard what I said. I said that, in our review, we wish to enter into a dialogue with Opposition parties to see whether we can find a basis of stability in our future relationships with local government.

So that we may be clear about the matter, will the Secretary of State confirm that he intends to try to take the issue of the poll tax out of party politics and to go for a second review of both the tax and the structure of local government, even though he knows that he has no intention of abolishing the tax? He has no permission to abolish it, on the very simple grounds that it would be the greatest U-turn in political history and a clear admission that we have been right all along.

The hon. Gentleman should appreciate that I am offering the Opposition the chance to contribute constructively to the establishment of a basis for stability within which local government can operate. It is quite apparent that the Opposition have no interest at all in constructive dialogue, because they can produce only negative proposals.

I hope that local authorities will also recognise that they have an important role to play. They must help us to improve the climate. In the past, I have not been slow to criticise waste and inefficiency in local government. I make no apology for that, and that will continue to be an aspect of criticism. However, I have also paid tribute to the part that local government plays—and should play—in defining and giving expression to our quality of life.

The hon. Member for Dagenham spent some time quoting speeches that I made when I was a Back Bencher. I am not sure whether he was wise to call in aid what Back Benchers say about their party's policies. If the hon. Gentleman listened to what his Back Benchers say about Labour's policies, he would realise that Back Benchers have a degree of freedom and discretion which is at the heart of our parliamentary democracy.

I do not for one moment attempt to escape from the fact that I have been involved in these matters before. Like many right hon. and hon. Members, I have views that I have expressed, and they are on the record. I have always assumed that that is what Back Benchers are for. Today, as Secretary of State, it is my responsibility to start afresh; in doing so, I neither overstate the possible, nor deny the potential.

The Secretary of State may or may not be aware that the offer of co-operation was made three years ago, in Committee on the Local Government Finance Bill, when my hon. Friend the Member for Copeland (Dr. Cunningham) made the then Secretary of State for the Environment the same offer. He pointed out the dangers facing the Government, and we told the Government to forget the poll tax altogether. We said that they should take the Bill back and that we should look together at a proper system of local government funding. The Secretary of State's present offer is three years too late. Does his present offer of co-operation include the abolition of the poll tax if it is found to be at fault?

My position is absolutely clear. We are conducting a comprehensive review, as defined by my right hon. Friend the Prime Minister. In that context, we rule nothing in and nothing out. In that spirit, I believe that the Opposition will come to regret their instant hostility to my offer.

Does the Secretary of State accept that my party believes that his philosophical approach is correct and that we must have a system for local government that will be permanent and which will last? Does he therefore accept that we would be willing to discuss with him all possible options, provided he repeats that no options, including complete abolition, are ruled out?

I made it quite clear that no options are ruled in and no options are ruled out. The observations of the hon. Member for Gordon (Mr. Bruce) are a great deal more statesmanlike than the instant party, divisive views of the hon. Member for Dagenham.

I want to understand what is being offered to me and my right hon. and hon. Friends. The right hon. Gentleman referred to a constructive dialogue. What is he actually offering? Is he suggesting all-party talks or that other parties join the working party? What is he suggesting exactly?

We can all welcome the thinking man's contribution from the Labour party. The hon. Member for Glasgow, Garscadden (Mr. Dewar) has suddenly spotted the trap into which the hon. Member for Dagenham fell from a million miles. My offer could not have been clearer. I am offering to consult the Opposition parties to see whether we can find a basis of stability for the relationship of this House with local government. That could not have been clearer, and it is recorded in Hansard.

I am grateful to the right hon. Gentleman for recognising that a variety of views are held by hon. Members who represent different Opposition parties on what should replace the community charge. My party has made that clear with our amendments and in our letter to him. Is the right hon. Gentleman to introduce a time scale for the completion of the dialogue to which he has referred?

I hope that the hon. Lady will accept my assurance that that matter will be addressed in my speech as I make progress.

First, I take the opportunity of congratulating the right hon. Gentleman on his return to the Government Front Bench. I can well understand his difficulty in answering the question yes or no, but surely he can answer with a yes or a no the question whether he will extend the poll tax. There still remains one party in Northern Ireland, the Conservative party, whose spokesmen want an extension of the poll tax. It is the only party left in the nation that takes that view. Will the right hon. Gentleman confirm that he will not extend the poll tax to Northern Ireland?

I said that I rule nothing in and rule nothing out but I hope that the House will understand if I rule out the concept that the poll tax should be extended to Northern Ireland.

I welcome the Secretary of State's undertaking that nothing whatsoever is ruled out. It will obviously take time to examine such a broad scenario. Can he give an undertaking that, in the meantime, some assurance can be given to the beleagured poll taxpayers that some relief will come as from next April?

I hear clearly what the hon. Gentleman says, and my answer is the same as that which I gave to the hon. Member for Moray (Mrs. Ewing). If the hon. Gentleman will allow me to expand my speech, I think that he will find that these matters will be thoroughly covered.

Order. I think that the Secretary of State has now given way to all the minority parties in the House. I think that it would now be wise to get on with the debate. Hon. Members will have an opportunity later of expressing their views if they are called.

I think that the House will feel that I have tried to reflect the interests of the House. If I give way further I might be trespassing on what I have to say later. The hon. Member for Coventry, South-East (Mr. Nellist) might have a small part to play in what I have to say.

I have been listening carefully to the Secretary of State. He appears to be saying that he and his party are now so bereft of ideas that they are prepared to come a-begging and to ask others whether they might be prepared to help. As we have already developed a fully worked out position, I am prepared to make a counter-offer, from a position of some strength.

If the right hon. Gentleman would care to talk on the basis of an agenda on which the abolition of the poll tax is the first item, and a proper consideration—with the help of the civil service and the Government's computers—of our alternative is the second item, I am prepared to make available to him, free of charge, our fully worked out proposal. I make a further offer. If the right hon. Gentleman recognises the merits of what we propose, we shall support him in any Division that takes place over any legislation that he brings forward to implement our proposals.

I am grateful to the hon. Gentleman for giving me an additional copy of his party's policy. It contains only one fact—the price, and that is too high. I congratulate the hon. Gentleman on a new record. He has been the proud possessor of the ability to move from policy position to policy position at three-day intervals. He has now done that in about three minutes. Having rejected what I have been saying, he now realises—with the assistance of his right hon. Friends—that I was actually giving the Opposition the most generous opportunity that they have ever been offered.

I think that I should continue arid say something more about my attitudes towards dealing with the matter.

I yield to no one in my belief that central Government must exercise their mandate; that in the end, power lies in this House. Indeed, all Governments insist that the mandate upon which they were elected should prevail. The Labour party must learn to accept that in opposition, just as surely as they have always accepted it in government.

Certainly, no Chancellor of the Exchequer can tolerate a challenge to his authority to manage the economy with prudence and discipline. No Secretary of State can turn his back on inadequate standards simply because they are administered by a local authority. Indeed, I would go further—I do not believe that this House would have legislated to share so much of its responsibility for financial prudence or for the quality of services if it had believed that local authorities would claim the right to frustrate or undermine the mandate of central Government.

I have made as clear as I can my belief that, with the authority of Parliament, the will of Governments must prevail. However, that clear statement does not and should not close the options for a partnership with local government that provides for civic pride and local initiative; nor should it close the potential for men and women to have their desire to serve their community fully satisfied within their own local authority; nor should it divert our attention in Parliament, or outside in local government, from the responsibility to deliver quality of service and value for money, without which it is the nation and its people that pay an unacceptable price.

I believe that now, far more than appeared possible 10 years ago, the importance of partnership is recognised. For all the rhetoric, and despite all the difficulties in the relationship between central and local government, there is a sense of partnership and co-operation in our inner cities, very much satisfying the aspirations that I held years ago. Despite all the tensions of the past 10 years, central and local government are now able to work together to regenerate some of our worst urban areas. Local authorities throughout the country, of all parties, have accepted the vital role of the private sector in economic revival——

The right hon. Gentleman is saying a great deal about partnership and the role that he wants to be developed between national and local government. Would he care to reflect on the fact that, when he was previously Secretary of State for the Environment, the amount of central Government expenditure as a proportion of total local government expenditure fell from 61 per cent. to 52 per cent., and that over the same period there were education cuts of 16 per cent.?

Those figures are not immediately in my mind. I remind the right hon. Gentleman that, when his party was in government, the collapse of local authority council building was imposed upon them by the International Monetary Fund. The reason why our waters and our sewers are in such a state today is that the Labour Government slaughtered the capital programmes. It is nothing short of hypocrisy for the right hon. Gentleman to try to deny what his Government were forced to do by the profligacy of their economic mismanagement.

I repeat what I profoundly believe—that, despite all the tensions of the past 10 years, central and local government can now work together to regenerate life in some of our worst urban areas. Local authorities are working together. Local authorities which told me 10 years ago that the message of involving the private sector was unacceptable are now at the forefront in their plans to do exactly that.

In all our big cities, there are now collaborative projects which show the right way ahead. The Birmingham Heartlands initiative is bringing together the city council, a number of private companies and central Government to regenerate east Birmingham.

In St. Helens on Merseyside, Ravenhead Renaissance is a consortium of private sector companies and the local council. With Government support, it is regenerating a large rundown area of the town.

In Newcastle, the Cruddas park project to regenerate two council estates grew out of a private sector initiative. In Glasgow, there is a striking example of the transformation that can be achieved when central and local government work in partnership with the private sector. If hon. Members doubt the success of that partnership, I urge them to go to Glasgow and see for themselves what is being achieved by partnership between local authorities and the private sector.

There is now a range of co-operation in the network of enterprise agencies giving advice and support to small companies. The Groundwork Trust is using the enthusiasms of the voluntary sector, the enterprise world and local authorities to clean the rural fringe in many of our older towns. [Interruption.] The nation will be dispirited by the Opposition's total indifference to all those major advances.

For a century, the Opposition have shown a deep embittered resentment at any constructive attempts to bring new life to the inner cities. They have a vested interest in talking down the success of Scotland. Time and time again, when they get the opportunity, they shout down anyone with whom they disagree.

I take a wholly more optimistic view. There has been a change of culture in Britain. Just as the flow of private sector cash into urban renewal has followed from the Government's initiatives, there is now a widening range of opportunities in our run down areas.

It is not simply a question of urban renewal. My Department has to deal with environmental issues. The entire nation is preoccupied with the view that we should develop an international presence in environmental matters. It is gravely damaging——

It is a genuine point of order, Mr. Speaker. As I understand it, the debate is entitled "Abolition of the Poll Tax". It is not an opportunity for a tour d'horizon to cover the five years during which the Secretary of State has been out of government. May we have your guidance on whether the Minister should address himself to the subject of the debate?

If the hon. Gentleman looks at the Order Paper, he will see that the Secretary of State is moving his amendment, and that is what he is addressing himself to.

Before we proceed, in what I hope will be good order, I should add that many of those hon. Members who are seeking to intervene are the very same hon. Members who are seeking to participate in the debate. It will be difficult for the Chair to call them if they seek to delay the proceedings in this way.

Order. As there was no point of order, the hon. Member cannot raise anything further on it.

It is really not good practice to seek to intervene in a speech by making a point of order, but I will allow the hon. Member to do so on this occasion.

You, Mr. Speaker, drew attention to the fact that the Secretary of State is speaking to his own amendment, which is all about the poll tax. His comments about urban renewal and the international perspective are fascinating stuff, but they have nothing to do with the business before the House.

Every right hon. and hon. Member has a right to make points in his own way. I have heard nothing that is out of order. If the hon. Member will examine the Government amendment, he will clearly see that the Secretary of State was perfectly in order.

It is inconceivable that one could address the subject of financing local government by whatever means and not be preoccupied with local government structure or the quality of the services for which the money is to be raised. I am glad that, despite the Opposition's totally artificial and almost irrelevant attitude, local Labour councils know that they must co-operate with central Government in the ways to which I referred.

Does my right hon. Friend agree that, given the way that he has presented the review, which provides for open and honest consultation, the electorate and others outside the House who are watching this debate will not understand artifically imposed conditions on his offer of discussions, designed to avoid councils participating in what many of them accept is an absolutely necessary reform of local government finance?

I am grateful to my hon. Friend. The general public will understand exactly the role that the Labour party is playing this afternoon. I greatly regret it, because from my talks with councillors of all political persuasions, I know full well that they want stability. They want to know the nature of the relationship and that it will stretch into the future. The Opposition are trying to frustrate a genuine attempt to find a constructive way forward.

I must refer to one more area in which co-operation is essential in the national interest. Local and central Government have an inseparable role in attracting inward investment—discretionary and footloose—to depressed areas of Britain where jobs need to be created. That will not happen if an alien atmosphere is created by Labour for party political reasons.

In all those matters, it is increasingly obvious that a new relationship is emerging between local and central Government. Local authorities are beginning to perceive and come to terms with their new strategic role as enabling authorities, as opposed to providers of all services. All that is fostering a new spirit of co-operation at local level, as private companies compete with local services, as owners intermingle with tenants, and as parents and teachers play an increasing role in school management. All those trends are to be welcomed, and are characteristic of the change in attitudes that occurred under the premiership of my right hon. Friend the Member for Finchley (Mrs. Thatcher).

The 1984–86 review of local finance, which led to the proposals for the community charge, concerned itself very much with the issue of accountability. It explored the mechanisms of central funding, which produced local tax rates, which bore little relation to local spending decisions. It found that, in many areas, only a minority of voters contributed to the cost of local services, and it found that in some areas much of the extra cost of services was met by those without a vote. That situation had to be addressed.

In practice, under our previous arrangements, many who consumed the local services were paying relatively little or nothing for them. That is why there has been a broad measure of support for the simple idea that nearly everyone should make a contribution to the cost of the local services that they consume. It is not that principle which has caused difficulty.

One thing that I have always made absolutely clear is that there is no quick fix for this problem. For next year, my predecessor announced some important proposals, which will significantly improve the financial position of local authorities and local charge payers. I am now considering the response to the consultation on those proposals. I will place the statutory reports before the House in the light of those comments, once colleagues have considered the matter.

As all right hon. and hon. Members know, there is no prospect whatsoever that a final answer can be designed, passed through Parliament and implemented in under a two-year time scale. A complete solution may require a longer time scale. That is a matter of hard reality. But: that is not an excuse for procrastination or delay. The issues involved have been explored many times. I must keep open, however, a proper sense of timing. Our review could well identify a programme, divided into quite different time perspectives. It may well be that what is required is a programme of building blocks, constructed logically and carefully towards a clearly defined objective.

In the context of such a review, it is obviously right to explore why it is that the ambitions originally set for the community charge have not found the necessary degree of public support and understanding.

An argument which is much advanced is that, if the charge had been introduced at a lower level, its underlying principles of accountability and broad coverage of most of those who benefit from local services might have been more readily accepted. We shall consider whether that is true; but there is one truth which cannot be avoided. Local authorities as a whole increased their spending by nearly 13 per cent. this year—and by nearly a quarter in only two years. It is difficult to escape the conclusion that local authorities have sought to use the turbulence of the changeover to mask their spending increases and to pass the blame on to others.

There is another truth. The law is the law. Bills legally issued under the authority of this place must be collected. There can be no dining a la carte with the law of the land. I want to say just a brief word to Opposition Members who hold to the constitutional novelty that they are the arbiters of what is legal and what is not, and particularly that they are justified in refusing to pay. I cannot abide the concept that many on low incomes from limited savings in their twilight years—[Interruption.] Of course the Opposition do not care, but we care. I cannot abide the concept that such people should be expected to pick up the tab for those who are elected to this House in the name of the world's foremost parliamentary democracy, and then claim a bogus veto over the mandate of the people. It is neither moral nor fair; nor is it constitutionally justified. The Labour party would never tolerate it from us if we were in opposition, and it is unforgivable that they should allow it to themselves in the present context.

Is it not a fact that, had it not been for the 14 million who have yet to pay the poll tax, the Secretary of State would not be here this afternoon announcing a review suggesting changes or possibly abolition? Furthermore, if the right hon. Gentleman is so concerned about people on low incomes, why—despite his announcement of a two—year review-is his right hon. Friend the Secretary of State for Social Security still imposing on every local authority in the country a £100 million cut in the Government payments made to them to provide rebates for the lowest paid? He is cutting those Government rebates from 97 per cent. to 95 per cent.

As the hon. Gentleman knows, one in four people receive a rebate. He has asked the wrong question: the question for the House is whether, by majority decision, we create the legislation that governs the country, or whether the hon. Gentleman's entrenched bigotry imposes a veto on what the majority of us decide here. But it is not just a question of the hon. Gentleman's having a veto; it is a question whether a large number of people who are a great deal less well off than he is should be expected to pay for his self-indulgent hypocrisy.

We are determined that the taxes that we advocate should be seen to be fair, and the British public must be persuaded that the arrangements proposed at the conclusion of the review will be fair. Our priority must now be to address their concerns as fully as possible.

Our second priority is to put the relationships between central and local government on a healthier footing—to replace conflict with partnership, preferably within a widely accepted consensus about their proper roles. This is not a debate about complete localism or complete centralism; a myriad of options lie in the middle ground. Some we may be quick to implement, while others will take longer. The task now is to identify what is available, and what will serve us best in the long term. That is why the Government have decided to include in its review issues of structure alongside issues of finance. If we can resolve those matters, there is, I believe, a chance for a new, constructive phase in the development of local government.

In all my consideration of these difficult issues, I cannot escape the fact that some of the greatest moments in British history have coincided with the times of resolve, civic pride and municipal initiative in our great towns and cities. I am therefore determined not to set a rigid timetable for our review. I cannot anticipate what agreements can be found; I can only promise to listen with care, to decide, with my colleagues, on the way forward once our review is complete, and then to act with determination. That is the responsibility of Government, and the responsibility that we shall discharge.

4.43 pm

On the occasion of my maiden speech, let me first thank those hon. Members who have extended a welcome to me, proffered all sorts of advice and helped me to settle in. I truly appreciate that.

Let me also pay tribute to previous Members of Parliament for Bootle—Simon Mahon, Allan Roberts and Mike Carr. I fully appreciate that I follow a long line of Members who were devoted to the Labour movement and to the people of Bootle. I pay particular tribute to my immediate predecessor, Mike Carr, who, very sadly—as we all know—spent a very short time among his colleagues in the House. In that short time, however, he endeared himself to the people of Bootle by showing such diligence, concern and general good feeling towards them. I am sure that hon. Members will wish to reiterate their sympathy and condolences to Mike's wife Lynn, his family and his parents.

In his maiden speech, Mike paid particular regard to education and training. Let me say, on behalf of the people of Bootle, that he was right to do so. I do not wish to be controversial, but Bootle is a classic example of the deterioration of our modern society over the past decade.

Bootle contains a wonderful collection of young people—witty, sparkling, exuberant and full of life. However, the ravages of unemployment have dulled that sparkle, and those young people are now wandering around aimlessly. It is not uncommon now to meet people in my constituency who have had no experience of a working life, despite being in their mid or late twenties. This is a tragedy for this country's economy—but, more important, it is a tragedy for the people themselves, who cannot feel positive and part and parcel of the society and the community to which they belong. That is the real tragedy.

I believe that any Government, of whatever complexion, must apply themselves to the problem. A Government who do not recognise the needs of their young people are doomed to failure in any event.

Bootle has many problems. At least 50 per cent. of the adult population receive some kind of state benefit. That seems a remarkable statistic, but it is true. It demonstrates the absence of an economic miracle on Merseyside. I must make that point, because I am here to plead on behalf of the local people. I am also here to plead on behalf of the 2,000 people in Bootle who are waiting for homes, and the 7,000 in the metropolitan borough of Sefton. All those people face very difficult problems.

It is fortunate that I should be making my maiden speech on the day when we are debating the poll tax. I must agree with what some of my hon. Friends have said: I have heard little evidence from Conservative Members of any discussion about the matter. I am sorry about that, because, on top of all its other problems, Bootle has a problem with the poll tax—not because anyone wants deliberately to confront the law, but because people are genuinely unable to pay.

A remarkable conflict is taking place in homes throughout Bootle, of which I have first-hand experience: law-abiding parents are trying to prevail on their children not to break the law. Meanwhile, the old and the sick must rely on friends and relations to pay their contribution for them. It is inconceivable—it is un-Christian, and a scandal in a modern society—that people should have to condition themselves to live in such a fashion.

I still do not know what the Conservative party's intentions are regarding the poll tax. By the time we vote tonight, I hope that I shall be clear about that. Only one course will resolve the problems in Bootle and elsewhere: the utter and outright rejection and repeal of the poll tax and its replacement by something that takes into account people's ability to pay so that they can be treated with compassion and concern. I believe that that is what the Labour party's alternative to the poll tax proposes.

4.50 pm

It is a particular pleasure and honour to follow the hon. Member for Bootle (Mr. Benton), who has just made an excellent maiden speech. The tradition that maiden speeches should not be controversial has undergone change, even during the relatively short time that I have been a Member of Parliament. I do not suppose that any of my right hon. and hon. Friends would have expected the hon. Member for Bootle to be other than forthright in setting out the issue as he sees it, and we appreciate that. I am sure that he will be advised by his colleagues that the next time he speaks he may not be listened to in silence, as happened on this occasion.

Hon. Members in all parts of the House will join the hon. Gentleman in his tribute not just to one predecessor but, sadly, to two within the same year. A most unfortunate series of circumstances hit Bootle. Although few of us got to know the hon. Gentleman's immediate predecessor, I worked for a number of years alongside Allan Roberts on housing issues. Whatever may have been our differences of view, I was never in any doubt about the clear and honest way in which he viewed housing issues. He did his bit to try to improve our understanding and knowledge of them. I welcome the hon. Member for Bootle to the House. We look forward to hearing from him on future occasions.

I should also welcome, albeit now in his absence, my right hon. Friend the Member for Henley (Mr. Heseltine) back to the Treasury Bench. He is perhaps the best qualified among us to deal with the subject. He will probably find that things have changed in the Department of the Environment since he was last there. Green issues overwhelmingly dominate discussions in the Department, subject only to the issue that we are discussing today. He is well qualified, as an evangelical speaker, to be Secretary of State for the Environment.

If I have any criticism of my right hon. Friend, it is that he was too generous to those who sit on the Opposition Front Bench, taking into account everything that has happened since the 1987 general election. As I said in my intervention, there have been no fewer than 65 changes of position or argument by Opposition Front-Bench spokesmen. The House will be relieved to know that I do not intend to go into each of them. but I have the information here. They include a local income tax, a roof tax, a combination of both, a floor tax, a supplement on national income tax and a return to the rates—the one tax that, above all, the Opposition were convinced had to be abolished. For a Labour party supporter it has been a grim journey.

The speech of the hon. Member for Dagenham (Mr. Gould) was long on introduction and on peroration but there was a predictable absence of anything in between the two. Nevertheless, the Opposition had the cheek to bring this motion before the House today. In their 1988 policy document on local government finance, they say that rateable values are mystifying and
"out of date, giving rise to all sorts of anomalies."
Despite that, we know what their policy is. In case that be thought to be a purely Conservative viewpoint, may I quote from the Local Government Chronicle, a well-respected local government paper, which on 12 October said:
"The end of poll tax would be popular. But its replacement looks expensive and to be as ephemeral."
The debate, however, provides us with an opportunity to debate the issue at precisely the right time.

My right hon. Friend the Member for Henley has already set out how open-minded he is. I trust that, after second or third consideration, Labour Members will recognise the advantage of contributing to that open-minded and open-ended discussion. No one party or any one Member of Parliament can claim to be all-knowing in this area. Far too many other alternatives and options have been offered for us to believe in such a thing as perfection.

I was a member of the Select Committee on the Environment in 1982 when it considered the possible replacement of the domestic rating system. I chaired the sitting that drew up the Select Committee's recommendations, so I bear a heavy responsibility. The Committee said that there was scope for improvement of the domestic rating system, but it rejected wholesale reform. The Committee persuaded the Government of the day to go along with that proposal, but a few years later the Government of the day had other views.

When the community charge first surfaced in 1986 in a Government Green Paper, I made two central objections to it. They are worth reiterating. The first was that, for about 75 per cent. of the population, the community charge would not be related to ability to pay. Secondly—this has turned out to he just as important—there was no consensus for change. Those two criticisms remain.

To take up a suggestion made by my right hon. Friend the Member for Henley, I intend to split what I am about to say between what I believe to be important short-term changes and long-term strategic change. I fully accept that we are not talking about the abolition of the community charge during the next two years. That idea has to be nailed straight away lest hon. Members should proceed on a false premise. Nevertheless, some helpful changes could be made that would improve the present system while the possibility of long-term strategic change was discussed, as suggested by my right hon. Friend.

We must accept that the existing rebate system must move further up the income scale. I know that some of my hon. Friends will put to me the problems that are associated with the poverty trap. I find it difficult to accept that apprentices earning £75 or £80 a week should be expected to pay the full community charge. My right hon. and hon. Friends could quote other cases that damage the operation of the community charge, even in the eyes of those who are its keenest supporters.

I am also worried about the fact that one-income households are denied the opportunity of a rebate for the non-earning spouse, who is not always the wife. I am open-minded as to what proportion of the community charge should be paid, if it is suggested that full eligibility for rebate ought to be denied. We must, however, offer something if the community charge is to gain wide acceptance, particularly among people with relatively modest incomes. I am also concerned about the elderly who live with their relatives. There is justifiable concern about the impact of the community charge upon them.

Let me highlight two important matters. The first concerns the existing system and the other relates to the old rating system. It is possible to envisage a long-term solution by means of which a flat-rate charge of £100 or £150 is paid by every adult over the age of 18. With a flat-rate charge of that kind, people may ask whether a rebate system is needed. However, it would take account of what many people have discovered: that there is support for the concept that everyone should pay something. Such a system would recognise that everybody ought to pay something. It also recognises that, although some 60 years ago there was usually one wage earner in a family, there are now often two, three or more wage earners all enjoying local authority services.

I shall not go into detail about the idea of a property tax, but recent research by the Institute of Revenues, Rating and Valuation and the Institute of Fiscal Studies showed that there is a 90 per cent. link between the value of people's homes and their incomes. I know that there are exceptions and problems such as widows living alone, but there is a considerable correlation. The research said:
"The old domestic rating system, which included rebates to the poor, was closely related to ability to pay, despite claims to the contrary."
As colleagues know, the cost of assessing and collecting the tax is much lower—[HON. MEMBERS: "Hear, hear."] I hear some support from the Opposition, but the research went on to show that the
"administrative and economic costs would be higher under the Labour party, which plans to impose higher rates of property tax on higher income groups."
I am simply pointing out that it is an approach which means that everybody pays something, while retaining a rebating system for the property tax element.

I have always thought that a property tax plays an important role in encouraging a more effective use of property and encouraging movement of small families to smaller properties. I see no harm in that. Almost in contradiction to that, I notice that a survey in March this year showed that only 6 per cent. of those surveyed thought that payment for local government services should be restricted to ratepayers alone. I agree with that, and that is why I have put forward my proposal for a two-tier system.

On structure, there is a growing move across the House towards single-tier local government and a reduction in the number of local authorities. I am looking closely at the suggestion made by several people, including my right hon. Friend the Secretary of State, of a directly elected mayor to run local authorities. A higher profile for a prominent local councillor might reduce the amount of correspondence to hon. Members in the mistaken belief that they are also councillors.

I have tried to keep my speech short, because many hon. Members want to contribute. However, I must mention consensus. For some reason, my right hon. Friend the Secretary of State did not consult me, so I prepared my speech in advance of knowing what he would say. As The Times pointed out, with the present disagreement across the House and within each of the parties, there is great advantage in hon. Members on both sides being prepared to say, "Yes, we could look at something on which we could reach about 90 per cent. agreement."

There will always be scope for disagreement on the rate of a tax, whether it is income tax or some other tax. However, with a tax of this importance, raising revenue of the size we are talking about, there should not be the sort of divisions that we have seen over the years. In part, that stems from what I said some time ago, which is that the abolition of the original system did not follow broad consensus and nor did the policy adopted to replace it. We can see that more clearly now. I do not want us to repeat that mistake, and I do not think that there is any need to do so. There are sufficient areas of disagreement between the parties over this and a range of other issues to allow for the disagreements to continue but for some consensus to emerge on the intelligent way to fund local government in the 21st century. I do not think that it will be as we are funding it now.

5.4 pm

Like the hon. Member for Hornchurch (Mr. Squire), I should like to congratulate the hon. Member for Bootle (Mr. Benton) on his maiden speech. As has already been said, it was forthright and direct. I have some knowledge of Merseyside, having spent some of my early life there, and I understand his concern about what has happened there and the severe scale of the problems that exist. He demonstrated clear and deep local knowledge and a commitment to ensuring that the issues are brought before the House. I commend the way that he did that, and look forward to hearing from him further.

I welcome the approach taken at the outset by the Secretary of State. He is right to say that local government finance is of paramount importance. Given that the Government, whether by force or humility, now recognise that the current system is unsatisfactory, it behoves all parties in the House to seize this opportunity in a constructive spirit and to reach a settlement that will last not for five years but for 50. I can say on behalf of the Liberal Democrats that we will be willing to become involved in constructive dialogue and hope that all options will be taken on board. The Secretary of State made it clear than no option was ruled out. We do not believe that, in those circumstances, preconditions for talks are required. The talks have been set out as an open proposition.

I am concerned that there is a suggestion from both sides of the House that we might return to the rates or some variation on them. Many of us have been through that hoop many times and have heard all the speeches about why rates were unfair. Those who think that they want to stand in front of the British public and defend the reintroduction of the rating system will have a lot of egg on their faces, probably literally, not just metaphorically.

Also, the suggestion has been mooted in one or two quarters that local government finance should be replaced by a levy on VAT. I hope that that will not be pursued. It is not the right connection between local services and local accountability. Also, it would be inflationary and would fall unevenly.

In the context of our amendment, I shall return to the view that a local income tax has a great deal to commend it. I hope that that option will be given clear, fair and objective analysis by the Government and the Secretary of State. I promise that I will not say it again but, during the leadership contest, the Secretary of State was asked why, if he was in favour of banding the poll tax, he would not acknowledge that the way to achieve it would be to introduce a local income tax as suggested by the Liberal Democrats. His reply was that he was not a Liberal Democrat.

I hope that the hon. Gentleman will acknowledge that that is not the best reason for rejecting a policy option. It should be considered seriously and in depth. It comes not just from the Liberal Democrats but was a recommendation of the Layfield committee. It works in many other countries, and we will enter into a constructive dialogue about that.

Mr. John Maxton
(Glasgow, Cathcart)