asked Her Majesty's Government:

My Lords, spending on the National Health Service in the United Kingdom in 1987–88 has been increased from a planned level of £20.8 billion to £21.5 billion, an increase over the previous year of 5.3 per cent. in real terms. Additional allocations made by the Government included £328 million in respect of pay review body awards and, for the hospital and community health services, £145 million to meet both specific and general pressures. The Government's plans for 1988–89 to 1990–91 provide for an additional £3.5 billion for the National Health Service as a whole.

My Lords, I thank the noble Lord for his reply. Since the consensus among responsible organisations—the BMA, the Royal College of Nursing, the Institute of Health Services Management, the National Association of Health Authorities, the King's Fund and the all-party Select Committee on Social Services—is that the National Health Service still needs an additional £1 billion to cope with severe underfunding, and since the consensus of the four most recent opinion polls is that four out of five taxpayers would have preferred the Chancellor to have given that sum of money to the National Health Service rather than in income tax relief, does the Minister accept that the decision to do the opposite shows an extraordinary degree of insensitivity both to health needs and to the wishes of the taxpayers?

No, my Lords. I do not think that it shows extraordinary insensitivity at all. As is well known, the Government make known their public expenditure plans in detail in January of each year. The Budget explains how those plans will be financed. However, the House should note that in his Budget speech yesterday my right honourable friend the Chancellor of the Exchequer said that over the coming year we shall be spending at least £1,100 million more on health care than in the year now ending. That can be found at column 998 of the Official Report of another place.

My Lords, is the Minister saying that the Government propose to disregard entirely the recommendations of the Select Committee of another place which has a majority of Conservative Members? Among various other recommendations along the same lines, the committee recommended that there should be real expansion in development of the National Health Service of 2 per cent. in 1988–89? Will the Government pay any attention to that?

My Lords, of course the Government always pay attention to and study with great care the reports of Select Committees of another place. In this case, the Government will be making a formal response in due course. However, my right honourable friend the Secretary of State thought it right to make clear that the Government do not accept that there is any need to provide additional funds in respect of 1987–88.

My Lords, does the Minister accept that the last time this matter was raised on the Floor of the House he said that an internal inquiry was being undertaken? When is that inquiry likely to be completed? Do the Government intend to announce their intentions and to comment on the report? Can he give more information about the inquiry?

Yes, my Lords. The noble Lord is absolutely right. There is indeed an internal inquiry, chaired by my right honourable friend the Prime Minister, which is examining the resources, state and management of the National Health Service. It will be for my right honourable friend to make a decision, firstly, as to how long the inquiry will continue and, secondly, whether a report of some kind will issue from it at the end. I shall be very surprised if there is not a report.

My Lords, did my noble friend note that the Labour Party was anxious to make Budget day into National Health Service day? Was that a success? Was the National Health Service working exceptionally well yesterday or was it limping?

My Lords, I observed that it rained for much of yesterday. I did not notice that the health employees who took industrial action made Budget day into a National Health Service day. I already know of 55 operations which had to be cancelled yesterday as a result of that industrial action.

Shame!

My Lords, is the Minister aware that his right honourable friend the Chancellor of the Exchequer yesterday cut taxes by £1.8 billion and that the Select Committee to which my noble friend referred said that the National Health Service had been underfunded by about the same amount of £1.8 billion? How does he reconcile those figures? Does he think that that is the way to create a just and caring society?

My Lords, in reply to the noble Lord the Leader of the Opposition, I made clear that public expenditure plans and paying for them were carried out in two separate operations and announced on two separate days. However, I should make the point that the Budget considerably increases the take-home pay of all employed people. The employees of the National Health Service, which is the largest employer in the kingdom, stand to gain significantly from the Chancellor's tax proposals. The precise position of individuals will vary according to circumstances, but on average a female nurse will be better off by £3 a week and an ambulance man by about £4 a week.

My Lords, is my noble friend aware that there is clearly a genuine feeling throughout the country that the National Health Service should be treated fairly and, up to a point, generously? Does he know that the nation is aware of certain groups which are trying to turn that feeling into a weapon of party-political propaganda? Does he agree that his right honourable friend should take that into account so that the conclusions to which he comes will be based upon efficiency and fairness?

My Lords, I agree absolutely with my noble friend. I should like to see the conclusions resulting from the review to which the noble Lord, Lord Mellish, referred and the various Whitley Council and pay review body awards to be based fairly and squarely upon logic.

My Lords, is the Minister aware that the change which many of us welcome in the mortgage interest relief, limiting it to the house and not to the number of persons, is likely to have a very serious effect on nurses, who are having difficulty trying to get housed in London and who have been getting together in twos and threes in order to make purchases? I should have thought that this will be a matter of very considerable concern to the noble Lord's department.

My Lords, I am glad that the noble Baroness welcomes the proposal in general. It will indeed make a difference to those nurses who are clubbing together, because the new arrangements apply per house rather than per person.

My Lords, I do not wish to make any narrow party political point, unlike the noble Lord opposite. However, will the Minister explain to me why, with these millions of pounds of additional money that the Government have given, in some instances wards remain closed or where they have been partially opened the future looks bleak for keeping them in operation? Why are wards still being closed after all this money has been given?

My Lords, with the greatest respect, that is a very good question. The basic answer is that services have been allowed to expand to a greater extent than the money available.

My Lords, is the Minister aware that the Opposition have complained frequently about the percentage of gross national product devoted by this country to the health service compared with other industrialised nations? Does that mean that people in other countries have better health than the people in this country?

My Lords, the answers to the two parts of my noble friend's supplementary question are, yes and no. Although the United Kingdom spends less of its GDP on health care than some other countries, it has no worse health as a result. For example, it has a lower rate of infant mortality than Austria, Belgium, Italy and the United States, all of which spend more.

My Lords, with regard to the figures that the noble Lord gave in his first reply, can he tell the House what account has been taken in them of the relative price effect?

Secondly, can he tell us more generally whether it is considered that the National Health Service is still safe in the hands of the present Government?

My Lords, yes. On the second part of the supplementary question, the record levels of health service expenditure which I described in my original Answer have been made possible by the Government's economic strategy, which has now seen the longest period of steady growth, at an average annual rate of 3 per cent., since the war. When considering figures—additional amounts of money for the National Health Service—the important factor is to make sure that what is allocated is wisely and properly spent. Therefore, yes, of course we take account of prices and wage inflation within the National Health Service.

My Lords, does the noble Lord agree that he was able to give the answers yes and no to his noble friend because of the excellent organisational structure of a tax-financed National Health Service? Is he aware that the current underfunding, and the Government's determined squeeze on the National Health Service, with all the consequences that we understand, lead some people to believe that the Government are doing this quite intentionally in order to show that the NHS now needs some major re-organisation with the emphasis on privatisation?

My Lords, I had better not go into the question of privatisation in answering a question on the health service in your Lordships' House. However, these are record levels and how the noble Lord can possibly describe them as a cut is beyond my comprehension.

My Lords, is my noble friend aware that year by year this Government have provided more for the National Health Service, and infinitely more than the party opposite, in particular, the noble Lord, Lord Ennals? It is a matter of judgment for the Government of the day to decide in their Budget how much can be allocated to each of the major services including the National Health Service. That this Government are getting it about right is indicated by the fact that, whatever other public opinion polls may show, a political poll shows the Conservative Party firmly 12 points ahead of the Labour Party.

My Lords, yes, indeed I am aware of that; but quite clearly noble Lords opposite are not.

My Lords, although the Minister states that more has been spent on the National Health Service, will he accept that for various reasons there is still serious underfunding? In that event, how can he justify the fact that a married couple on £4,000 a year receive £55 remission from tax under the new arrangements but a couple with £70,000 per annum receive £7,914? Is that socially defensible? Are the Government's priorites right?

My Lords, I find it very difficult to relate that question to the one that I am trying to answer today. However, I would point out that there are quite a considerable number of people—for example, consultants within the health service—who will he helped by the reduction in the higher rates of tax in pursuing their chosen activity.

My Lords, in an earlier reply the Minister referred to the use of resources. Is he aware that in some hospitals it is now extremely hard to admit patients at all? In one hospital in the South-West on Sunday, Monday and Tuesday of last week the surgeons in just one department wished to admit 17 patients for urgent investigations. As a result of the stringency of the budget, there were beds available for only four. The doctors, nurses, porters and technicians still had to be paid and equipment at a cost of £1 million was left idle. The Government sometimes refer to the misuse and waste of resources within the health service. Does the Minister agree that a large proportion of that so-called "misuse" is a direct result of government policy?

My Lords, no, of course it is not a result of government policy. The noble Lord should understand that we should all be thinking and talking about patients and not furniture. Over 1 million more in-patient cases are now being treated than in 1979. The number of cases is 6.4 million, a rise of 18.8 per cent., and that is the important figure to keep in mind.

My Lords, would the Minister care to explain that to the 13 people who were not admitted?

Next Question!

My Lords, will the noble Lord agree that we are facing two problems? The first problem is that the increase in high-tech is constantly demanding a substantial increase in the resources of the National Health Service. Secondly, it is arguable that the service may not have been as efficient as it could have been; but that does not excuse the Government cutting off funds with the idea of increasing efficiency when they are considering a long-term solution to the problems. In the meantime, we should not have to suffer what is being suffered by the National Health Service.

My Lords, at least £1.1 billion extra for the National Health Service next year is no cut.

asked Her Majesty's Government:

Yes, my Lords. In his Budget yesterday my right honourable friend the Chancellor of the Exchequer announced proposals which will remove the tax penalties on marriage.

My Lords, I thank the noble Lord for his Answer. Had I put the Question last Wednesday as I had intended, he would not have been able to give that Answer. However, I am glad that one from these Benches has had the opportunity of congratulating Her Majesty's Government for something that they have done. Many people will be grateful for what has been done in the Budget. Will the noble Lord agree with this? In view of the fact that an important principle is involved—namely, the support and encouragement of marriage as a key part of our society—and also in view of the fact that we have been able to grant tax concessions in other sectors of our land, the concession should have been granted forthwith rather than in 1990?

My Lords, I am grateful for the right reverend Prelate's general welcome to the proposals contained in my right honourable friend's Budget yesterday. Had the right reverend Prelate asked the Question last Wednesday, I should not have been able to give the Answer, so his sense of timing in having asked it today is immaculate. Each individual measure will be introduced as soon as is practical. Independent taxation is a major change in the tax affairs of millions of couples and it will need careful preparation. For that reason it was not possible to introduce the measure until 1990.

My Lords, does the Minister recognise the fact that those who had some responsibility in this area but who failed to do anything about it will readily acknowledge, as do I, that the Chancellor has sought to grasp this very difficult nettle? On the other hand, will he also accept the fact that the new married couple's allowance goes some way to negate the advantages contained in the proposal in that there is still a substantial difference between men and women—

Hear, hear!

My Lords, I am glad that your Lordships recognise that fact. I should also like to put to the Minister that in the red book the Chancellor states that in the second year of introduction the proposals will cost £1 billion of revenue, and that is based on the existing capital and income distribution which will change when tax avoidance opportunities are recognised. In those circumstances, can we at least have an assurance from the Government that that is only a transitional arrangement, and that it is their intention to move towards real equality between men and women in the tax field?

My Lords, I am grateful for the first part of the noble Lord's Question, and I shall pass on his remarks to my right honourable friend the Chancellor of the Exchequer. As regards there being a substantial difference between men and women, I believe that all noble Lords recognise that to be the case. We believe that the tax system should recognise the financial responsibilities of marriage. Without the married couple's allowance, the married man's tax threshold would fall substantially. I cannot at the moment give an answer regarding the figures which the noble Lord quoted.

My Lords, is the noble Lord aware that there is a feeling among noble Lords on this side of the House (but which is by no means confined to noble Lords who sit on these Benches) that it would have been much fairer, within the ordinary concept of British justice and fairness, to have brought some measure of relief to the 12 million of our population who are living at or below the poverty level, and which includes a large number of married couples?

My Lords, that has little to do with the Question before the House. That refers to the discrimination between married and unmarried couples. The package that was introduced in yesterday's Budget removes the discrimination against marriage, and I believe that it should be welcomed from that point of view.

My Lords, will my noble friend convey to his right honourable friend the Chancellor of the Exchequer the fact that the proposals have been received with a great deal of pleasure by many women's organisations which have compaigned for a very long time? I believe that in this field the proposals will provide a real measure of justice which has been long sought.

My Lords, of course I shall do so; and I am grateful to my noble friend for her remarks. When the package is finally complete in April 1990, there will be no further discrimination against marriage.

My Lords, does the Minister not agree that the date on which the new legislation for married women takes effect will be the same date on which vast numbers of married women will pay a community charge for the first time; in other words, the poll tax?

My Lords, their husbands will not have to pay rates. Therefore, the situation will be even more equal than at present because the husband and wife will each pay the same, as compared with the present time when the husband probably pays the rates.

asked Her Majesty's Government:

My Lords, health authorities already raise income in a variety of ways and we are currently seeking powers in the Health and Medicines Bill, which will come before your Lordships shortly, to enhance their ability to do this. The income generation unit, which will start work early in the new financial year, will help authorities to obtain the maximum benefit from both existing and new powers.

My Lords, I thank my noble friend for his enlightening reply. Can he explain how this exciting and promising new scheme will operate?

My Lords, the income generation unit, to which I referred in my original Answer, has been set up to establish good practice in the income generation field and to help, develop and disseminate new opportunities. It will be headed by Mr. Ron Kerr, currently a district general manager in the North Hertfordshire District Health Authority and will be staffed by a mixture of seconded National Health Service employees and civil servants. It will be up and running early in the new financial year. We expect the income generation to increase funding for the health service by approximately £10 million to £20 million in 1988–89, rising over three years to over £70 million a year.

My Lords, Clause 4(1)(d) of the Health and Medicines Bill empowers the Secretary of State to supply services to any person and to provide new services. Can the noble Lord say whether that means that health authorities will be able to run an NHS pharmacy on hospital premises, open to the general public but outside the remit of the pharmaceutical sub-committee, under the recently re-negotiated pharmacies contract?

My Lords, it is a very wide power to which the noble Lord has drawn attention. I believe it would be better to discuss it during the period given over to discussion of the Health and Medicines Bill rather than now.

My Lords, does not the noble Lord agree that however successful the new income generation scheme may be, it is unlikely to do much to solve the current grave problems of underfunding in the NHS?

My Lords, every little extra is welcome, as I am sure the noble Lord will agree. I can confirm that health authorities will be able to keep the money they raise.

My Lords, can the Minister say who will be responsible at local hospital level for this fantastic scheme of income generation which could be described in other words?

My Lords, I expect that those hospitals that decide to go in for the scheme in a big way would need an extra person in order to carry it out.

My Lords, perhaps I missed it, but can the Minister tell me the date when the scheme is thought to be coming into operation?

My Lords, not specifically. The income generation unit will be up and running early in the new financial year. As regards the extra powers under the Health and Medicines Bill, they will depend on the date of Royal Assent.

My Lords, does that mean that the scheme will not come into operation until the Bill receives Royal Assent?

My Lords, that is not a reason, however, why planning should not be conducted.

asked Her Majesty's Government:

My Lords, on 4th February the Health and Safety Executive published a document on the tolerability of risk from nuclear power stations as a contribution to public discussion on this subject. A copy of the document was placed in the Library of the House.

My Lords, I thank my noble friend for that Answer. I hope that Her Majesty's Government will continue to reassure the public on the safety of nuclear power stations. Can the Minister tell me what progress is being made in getting the Nuclear Installations Inspectorate up to strength?

My Lords, the Government are committed to ensuring that the Nuclear Installations Inspectorate has the necessary resources to perform its duties effectively. Following special pay awards and extensive recruitment campaigns, the NII has now met its target of 120 inspectors by 1st April 1988.

My Lords, is not the greatest single worry of the public above nuclear energy the problem of radioactive waste disposal? Can the Minister say whether the Government have made any progress on the recommendation of the Layfield Report with regard to radioactive waste management?

My Lords, yes. The composition of the Radioactive Waste Management Advisory Committee—or RWMAC—is kept under review by my right honourable friends the Secretaries of State for the Environment, for Scotland and for Wales who have availability of environmental expertise to the committee well in mind. Several of the present members have a background in environmental science and the Government will continue to look for environmental expertise when making future appointments. I believe that meets with the inspectors' concerns underlying those recommendations.

My Lords, bearing in mind previous Questions in your Lordships' House, can the Minister give any indication as to the commencement date of the next nuclear power station?

My Lords, no. This document will have a very important effect and will be scrutinised when the public inquiry into Hinkley C takes place.

My Lords, is the noble Viscount aware that there was considerable disquiet in North Wales about the proposal to conduct certain tests at the Trawsfynydd nuclear power station? Is he further aware that those tests were abandoned at the last moment? Will he give the House and myself an assurance that there is no question that those tests will be reconsidered?

My Lords, the test was postponed due to the strength of concern felt locally. When the CEGB wish to proceed with tests of this kind in the future, a full presentation to the local residents will be made so that concerns can be set at rest. No test can go ahead without the agreement of the NIL who only give such agreement if it is totally assured as to the safety of the test.

My Lords, is the noble Viscount aware that I and many others in North Wales will appreciate that the Government and the CEGB took account of the concern of the local population?

My Lords, I am grateful to the noble Lord.

My Lords, with the leave of the House, I should like, as usual, to say a word about the two short debates standing in the names of my noble friend Lord Campbell of Croy and the noble Lord, Lord Peston. It is customary in short debates that the mover is allowed approximately 15 minutes, and that the Minister should rise to reply not less than 20 minutes before the scheduled end of the debates. In the case of the short debate in the name of my noble friend Lord Campbell of Croy, this means that all other speeches should be limited to a maximum of 14 minutes, and in that of the noble Lord, Lord Peston, to 11 minutes. If any noble Lord should speak at greater length, it would be at the expense of subsequent speakers in the debate.

rose to call attention to the recruitment process to the security service and British intelligence and the case for a legally enforceable contract of silence to be entered into at the time of recruitment; and to move for Papers.

My Lords, it is a great privilege for me to take part on this first occasion in a debate initiated by the noble Lord, Lord Campbell of Croy, with whom I have had many debates in the other place in the past. I believe that your Lordships may like to know one tiny point. I am not quite sure how far your Lordships take interest in the Guinness Book of Records. I think there may be a tiny point of interest here. If one takes myself, the noble Lord, Lord Home and the noble Earl, Lord Lauderdale, between us we take the name of South Lanark as a constituency and its representation right back to 1931. I believe that is quite a considerable period. I am not sure whether it has been exceeded in any instance.

The noble Lord, Lord Campbell, in introducing this debate, has said that he wishes to do so in order to air the whole subject that he has raised. One welcomes that. That being so, I know that I shall not be regarded as being wrongly controversial or provocative if I venture not to agree with absolutely every point that he has put forward. I believe the issue that he raises promotes and requires consideration of questions of quite fundamental importance in a democratic society.

Many of those questions would be much easier to resolve if we had a freedom of information Act. In itself that would answer many of the difficulties that arise without such an Act. It is a matter of some debate. I very much hope that on all sides we can agree that in this respect the Americans have set us a very good example and that we could well move towards a really effective freedom of information Act.

Perhaps the principal dilemma that faces us when we consider the issues which the noble Lord has raised, is that of balancing the right of freedom of information with the duty of confidentiality. I hasten to say that I have no quarrel with him whatever when it comes to protecting confidentiality on issues of terrorism and matters of that kind. That is situations where life is involved. However, it stretches far wider than that.

Perhaps I may take as a kind of text the recent decision in Edinburgh in the Cavendish case and the judgment of Lord Coulsfield. In passing, perhaps I may mention that one of the examples to which he refers in making his judgment I have not had the time to look up although it looks a fascinating case. He quotes the 1849 case of Prince Albert v. Strange. I confess that I have not taken the energy to see exactly what that involves.

Lord Coulsfield in his judgment does not specifically refer to the publication of the particular memoirs or the argument with the Glasgow Herald or The Scotsman. It is a statement of some principle. He said:

"…on the one hand the interest in preservation of confidentiality of government information is a public interest and, on the other hand, there are competing public interests in freedom of speech and freedom of the press, and, indeed, a public interest in good government, which may be advanced by public discussion of the information in question".

He went on to say,

"In striking the balance the court is not bound to accept the ipse dixit of the government or its representative as to the effect of a particular disclosure on the national interest."

The final passage I quote is one where I agree entirely with Lord Coulsfield:

"If it is said that a particular disclosure will directly endanger national security, little, if anything, more may be required. Apart from that extreme case, however, it is for the Crown, like any other party seeking to restrain publication, to show that the restraint is necessary.".

If we take that as an extremely good context within which these matters should be considered, I think that we may go on to consider the following points.

Immediately a further question is raised concerning to whom or to what loyalty lies. I note that last week in evidence to a Select Committee in the other place on this subject, Sir Robin Butler, the head of the Civil Service, said that the duty of loyalty of a civil servant (anyone who has signed the Official Secrets Act) lay to ministers and to the government of the day. That is the commonly accepted view. I am not sure that we do not need to reconsider that a little in the light of some of the facts that we now know.

Let me mention in passing the highly controversial hook of Peter Wright, which in my view is extremely mediocre and does not deserve the immense royalties it is presently earning. However, what are his disclosures about the MI5 plot against the Wilson Government? I am one of those who know that allegations in his book are true. But if the duty of loyalty is to ministers and the government of the time—that is to say if Sir Robin Butler's definition is accepted—it follows that it is the duty of loyalty of the civil servants of the time to expose those machinations. I cannot see that logic can take us in any other direction. Why did Mr. Wright not do so? Why did his superiors not do so if their duty was to the government, as Sir Robin Butler and the present Government insist that it should be?

I believe that there is a real problem here about achieving accountability, and hence the proposals which the noble Lord has mentioned are useful. I think that the further proposals to achieve greater accountability would go a little further, and I would welcome them. But without accountability there can clearly be the irresponsibility (and I use the word in its perfectly proper sense) which allows such activities to be indulged in by those who are supposed to have a prime loyalty to the government under whom they serve.

I believe a rather wider definition of the duty of loyalty may be required. In the troubled and changing times in which we live it may be better if we at least considered a definition which said that loyalty should be to the values of a democratic society and the concept of liberty which is essential to those values. If one were to take that kind of definition and link it with the public right to freedom of information, one would be in a different and perhaps more sensible ball game.

Perhaps I may give just one example. There was some discussion earlier today concerning the safety of nuclear power stations. Let us take as a hypothetical example the case of a civil servant or quasi-civil servant bound by the Official Secrets Act who is working in the field of nuclear energy and who knows that there is hazard to public health which is not publicly known. Where does his duty lie in the balance which is expressed in Lord Coulsfield's judgment between the public right to information and the duty of confidentiality? I suggest that such a case throws up questions which have not yet been answered and which I venture to suggest would not be answered by the approach which the noble Lord has taken in introducing the debate.

It may be (and this has tended to happen recently) that in order to resolve his personal dilemma he leaks some information; then there is a mole hunt in Whitehall. Of course this is a highly unsatisfactory way of dealing with such a problem. It may even be that the balance of rights and duties favours what he has done. How much better if the right of the public to information did not impose upon him a problem which he can resolve only by the rather unpleasant act of leaking documents to the press or whoever.

There have been so many recent battles in the courts on these issues and so much activity undertaken in relation to them, that I have sometimes wondered whether there was not a very secret new method of employment creation—if one takes into account the lawyers, the journalists, the television producers and the film producers to come. If there were a freedom of information Act I might be able to discover whether this is a secret technique of the Department of Employment.

In the meantime I say very seriously that I believe the issue which the noble Lord has raised is one which merits very full exploration. I do not believe that his approach is enough. However, I hope very much that if the Government are now considering a White Paper on a new Official Secrets Act they will provide the opportunity for the very full and philosophical debate about the competing rights and duties that is necessary before there can be a satisfactory resolution of the issues.

My Lords, in following the noble Baroness in this debate I have the pleasure and honour of congratulating her most warmly on her maiden speech. It may be that in the history of this House there have been less controversial maiden speeches, but I doubt whether there has been a speech which has been listened to with greater respect and attention. When I say that we hope to hear her again I do so with a special meaning. I imagine that the subject that she raised so interestingly of the balance between preserving confidentiality and access to information will be discussed further and that in June when the Government issue a White Paper, and soon afterwards perhaps when there is a Bill, we shall have endless debates in Committee and at Second Reading We look forward to the contribution which we are certain to hear from the noble Baroness.

There was not a great deal of common ground between the two speeches that we have heard. The noble Lord, Lord Campbell, concentrated on the question of recruitment to the intelligence services. There were one or two questions which I wished him to answer about his scheme for subjecting new entrants to the intelligence services to a binding contract. I wanted to know how that linked up with the new legislation that is certain to be introduced in the field of secrecy and the preservation of state secrets. Perhaps if he gets an opportunity we can know more. It seems to me that we shall have a major study of this whole problem of confidentiality versus freedom of information. I do not see how that will fit into the suggestions made by the noble Lord for the recruitment of intelligence personnel.

I was also slightly disappointed that he said that he had no questions for the Government. I have many questions for them. We are grateful to the noble Lord, Lord Campbell, for providing the Government with this opportunity to confirm that there will be a White Paper in June in this field and to tell the House how they are thinking on these difficult questions. We were all puzzled, for example, when the Government put a three-line Whip on an admirable Bill by a gallant Conservative Back-Bencher, Mr. Richard Shepherd. We could not understand this. We could not understand why the Government should object to Mr. Shepherd's Bill. Now that some time has passed, perhaps the noble Earl, when he replies, can tell us what the Government found wrong with that Bill. After all it was very nearly passed by another place on Second Reading despite a three-line Whip.

Of course we all share the aim of the noble Lord, Lord Campbell of Croy, of democracies' need to protect themselves against terrorism, subversion and espionage. They often need to act secretly in order to do so. People who knowingly divulge such secrets, without seeking authority, are traitors. I have read the book Spycatcher—I think we all have—and I share entirely the rather derogatory view of the noble Baroness. In fact, I go a little further if only because if contains one sentence about myself which is both derogatory and untrue.

However, the fact is that it is not a book written from a sense of principle in order to inform the public of matters there is a need for them to know; I deny that absolutely. I am also a little suspicious about those rather skimpy passages about a plot againt the previous Prime Minister, Mr. Harold Wilson. In my opinion, the book was in effect an act of treachery. I think we have to ensure somehow or other that such a situation does not arise again or, if it is done again, that the perpetrator is put behind bars.

The question is: does the suggestion of the noble Lord actually fulfil the admirable aim that he has in mind? This is why I have some doubts. I am inclined to think that legislation is better. It seems to me that if an intelligence officer needs to be bound by a binding contract not to divulge secrets, then he is not fit to be an intelligence officer. I doubt whether one will ever be able to coerce an intelligence officer in that manner. Furthermore, I cannot see why the solution suggested by the noble Lord, Lord Campbell of Croy, should prevent an intelligence officer who has signed a contract doing what happened in the case of Spycatcher—publishing overseas, beyond the reach of punishment, should he wish to do so. Therefore, a good intelligence officer is one who keeps his mouth shut because he is a person of principle rather than because he has signed an elaborate contract.

It would be better perhaps to await the outcome of the long discussions which will take place about the proposals for new legislation. Everyone agrees, and has done so for years, that Section 2 of the Official Secrets Act is too wide and too weak and that new legislation is needed. Indeed, my old party, the Liberal Party, introduced on two occasions into another place a freedom of information Bill which would not only have made accessible to the public information to which they are entitled and to which at present they have no access but also would have strengthened the protection of state secrets—another admirable project. As I have said, Mr. Shepherd produced only this January another Bill along the same lines which very nearly succeeded. We now await the arrival of the White Paper in June.

I think it is fairly easy to predict that we will find it particularly difficult to legislate against the intelligence officer who, as in the case of Spycatcher, is prepared to make his fortune and avoid punishment by going abroad. Perhaps during the debate we shall find some way around that loophole. I am not satisfied that the solution offered by the noble Lord, Lord Campbell of Croy, overcomes the difficulty. Therefore, it may be that we should concentrate once more on the need to refine our methods of recruitment, observe meticulously the work and the attitude to work of intelligence officers and attend carefully to terms of service. The noble Lord mentioned pensions and such matters. I think that if our standards here had been higher in the past we could have avoided some of the disastrous mistakes that have been made.

I ask noble Lords to believe that I have never been a security risk. However, I have known some famous MI5 officers. I knew Blunt and Burgess; I was once even interviewed by Spycatcher. I played golf with Roger Hollis. Yet, with the exception perhaps of Hollis, I do not think that any of those men should have been recruited into the security service. I doubt whether any of us here today would have done so. Recruitment is the matter in the end we need to come hack to and examine carefully. We can devise binding contracts and pass new laws. But the worth of our intelligence service depends most of all on the integrity of its staff. It may well be that improved recruitment and management would do most to avoid the disasters of the past.

My Lords, may I from these Benches add our congratulations to the noble Baroness, Lady Hart of South Lanark, on her very eloquent and thoughtful maiden speech. I am sure that we all look forward very much to hearing equally eloquent and thoughtful speeches on other subjects in the future.

We are most grateful to the noble Lord, Lord Campbell of Croy, for giving us the opportunity to talk about this subject. The difficulty is that if we actually knew what the arrangements for selection and recruitment of officers into those services were, and what their contracts were, we would not be allowed to talk about them. It is true to say that most of us do not in fact know. The result is that we are dependent upon revelations of mistakes that have been made in the past, to which the noble Lord, Lord Mayhew, referred. We have recruited people who, as it turned out, should not have been recruited; for example, Philby, Burgess, Blunt and, no doubt, Peter Wright. My qualifications for speaking on the subject are that I have been a customer of those services over many years in many different places. I must, however, stress that I am very out-of-date. It is 10 years since I had any job which involved dealing with those services. Over that period, on many occasions and in many places, I was a very satisfied customer. I am sure that today the authorities responsible for the affairs in Northern Ireland and Gibraltar are highly satisfied customers.

The recent operations of the intelligence service in keeping track of the gang of three who met their unfortunate end in Gibraltar is an example. On the other hand, I must admit that at times and in many different places, I was not a wholly satisfied customer. I know, and I have experienced working with, many able and dedicated members of those services. However, I have unfortunately come across some of those people who seem to be a little amateurish. At times their attitude towards their work appeared to me to savour of Sherlock Holmes, Richard Hannay, Bulldog Drummond—if anyone can remember him—or even James Bond.

I have two criticisms to make. First, the people concerned seem to live in a completely closed world whereby what really went on and what people actually thought and did, they just did not understand. My other criticism is the lack of coordination between the different intelligence services and between them and the counter-intelligence services. In each case where the army became involved in troubles which involved close work with the intelligence and counter-intelligence services, for example in Malaya, Cyprus, Kenya, Aden and certainly in Northern Ireland—it was not quite the same in Borneo—the whole intelligence side had to be sorted out, brought together and a single head appointed to co-ordinate them in order for operations to have any success. I ask why those criticisms should have arisen. The answer is, of course, the obsession—correctly—of the services themselves with extreme secrecy.

As the noble Lord, Lord Campbell, said, it is of course essential that the services' operations should be secret; that people should not know who their operators are; that they cannot recognise them; and, what is more, that no one should understand their methods. The result of that is often that the services do not co-operate with one another because of their fear that their secrecy will somehow be broken. That obsession with secrecy is also the cause of their appearing to live in an unreal world.

I am attracted by the noble Lord's suggestion of a contract which is not the same for everyone in the service. Some people in the service have to observe strict restrictions on what they say and do. That does not necessarily apply to all. Although I see the force of the argument put forward by the noble Lord, Lord Mayhew, that no contract would have prevented the men I mentioned from doing what they did—I think he is probably right about that—the idea of a contract different for different people is attractive.

I am uncertain about the vow of lifelong silence. I speak as a trustee of the Institute of Contemporary British History, among other things. My experience of dealing with the Ministry of Defence since I wrote a book on E1 Alamein 30 years ago is that. if one leaves the matter to the government department concerned, or the head of the service, to decide whether something can be revealed, nothing is ever revealed; and trivial things could have been revealed much earlier.

There should be an independent tribunal of some kind. It could be something in the nature of the Security Commission, to which a Crown servant, including a member of the secret services, if he wishes to reveal something that occurred during his service, can submit. That material could be looked at, not by the government department involved, but by such an independent tribunal. That suggestion is something that might be considered.

Had the criticisms of which I have spoken occurred in the armed forces, one would not have looked just at the selection and recruitment of the personnel in the first instance, but at their training—because training reveals a great deal about a man. I know nothing of the training system, if there is one, for any of the intelligence services or for the security service; but the impression one receives—it may be a totally false impression for all I know—is that the system for selection and training is rather like the one employed by the army in the 18th century. We want to be careful about criticising that system because it produced Marlborough and Wellington, so it did not do too badly, but the armed forces have moved forward from there. The system operates on the basis that, provided the man or woman is a friend of a friend of a friend, he or she must be all right. After having enlisted that person, the training consists of seeing that he or she learns on the job. Most organisations, and especially the armed forces, would feel that that was a totally inadequate system for a service as important as these services.

If selection and training are to be improved, how is that to be done? I understand that there may have been some inquiries on the subject in recent years. I do not know whether there have been. I do not know what their recommendations were. I do not know whether they were implemented. A form of central organisation for selection, recruitment and training for all the services we are talking about has something to be said for it. There are of course grave dangers in a centralised intelligence organisation. There is the sinister aspect—that we are creating something like the KGB or the Gestapo. There is also a grave danger for intelligence itself of having a monolithic organisation. All intelligence organisations tend to have fixed ideas about things. The Israeli intelligence organisation before the Yom Kippur war is a good example of that point. If one relies solely on one source, one may be badly let down.

There is one aspect of this issue which is of great importance: the exploitation of science and technology in all those services. I am a member of your Lordships' Select Committee on Science and Technology. I am sure that it would be interesting to study the application of science and technology to the intelligence services, but I do not think that we should be allowed to carry it out. Any application of information technology to the gathering of secret information must immediately be applicable to someone who is trying to prevent people from gathering information. That is one aspect of the problem which calls for a central selection and recruitment organisation. However, I realise that the subject of organisation is beyond the scope of the debate.

On the aspects which have been raised in the debate—the publication of material which was classified at the time but should not necessarily forever remain classified; selection and recruitment; and training in general—there are great advantages in having people who do not come from the service concerned and who can take a broader look at the problem. Perhaps this would meet the point made by the noble Baroness. Such a body would not be an executive arm of the Government but an organisation that could take an independent look. Like the noble Lord, Lord Campbell of Croy, I do not expect the Government to give any answers. I should like merely to draw those aspects of the problem to their attention.

My Lords, judging from the evidence of her maiden speech, the House is fortunate to have added the noble Baroness to its number. I appreciated her willingness to speak of important ideas. We all look forward to hearing much more from the former honourable Member for Lanark. I was pleased when my noble friend's Motion surfaced so soon after the second debate on the security services which was opened by the noble Lord, Lord Jenkins. One does not often have the opportunity to develop an argument or point of view, and so I make no apology for speaking a third time in three debates.

We are grateful to the noble Lord, Lord Campbell of Croy, on this occasion, because he has forced us to focus on two key issues of our intelligence gathering. If we get them wrong, our intelligence, which should be the very foundation of policy, becomes a waste of time and money. The choice is as stark as that. If we know more and know it first, we have the raw material for turning the future; if we know less, and we know it last, we have not only wasted money, we have put at risk lives, principles and freedom itself.

The task given to the intelligence services begins with information. It ends with assessing the importance of that information. As I have said in the House each time the subject has been aired, the mission of the service is to predict intention. It is the mission of the service to pass on those findings to the political managers of the country's affairs. The long-range objectives, which we as a nation support by voting funds and by granting access to the Royal Prerogative, are necessary to this Government and to any government of Great Britain.

We in this House have twice debated the issue of accountability. It usually comes down to a call for operational scrutiny, which would be inane if it were not dangerous. Arguments put foward for an accountability body do not stand up in the real world.

However, turning to the first part of the proposition put forward by the noble Lord, Lord Campbell—the issue of recruitment—we are in an area in which we have perhaps less need to conjecture. I shall talk for a moment about what became MI6. At the end of the war, the service drew mainly on SOE people, and leaned towards the more temperamentally thoughtful. This source dried up in the early 1950s and the service opted for a system of talent-spotting through the universities, giving the talent scouts a profile which concentrated on well-roundedness, academic stability rather than glitter and a personal framework of integrity. I believe the system, contrary to some popular speculation, has worked extremely well. Since the 1950s the flow of candidate raw material has been steady and it has been of high calibre.

I think we can also straighten out the myth that recruitment was or is propped up by the class system. We can infer that recruitment into the security and intelligence services has not been on class lines since the war. If anything, because of tragic mistakes which harked back to 19th-century ideas of links between class and codes of honour, we can deduce a real effort to split apart the recruitment process and any lingering discrimination in favour of privileged backgrounds.

Since the time that this university system has been in use the recruitment process has been remorselessly tightened. Positive vetting, after the Radcliffe recommendations, has become increasingly thorough and is recycled every five years for every officer. The first six months' training for candidates, one believes, is now the severest test of mental resilience and even after that an officer is on probation for three years.

Reviews are made every year throughout a person's service and a man's or woman's progress is constantly being shaped to capitalise on that individual's particular strengths or gifts. I am told that positive vetting has been made more thorough in the last couple of years and is now a substantial user of the service's resources.

The result of the care with which people are recruited, assessed, guided and promoted is that the security services—only really now in their maturity—enjoy an exceptional quality of cohesion. The bonds of respect are lifetime bonds. Where we on the outside find episodes like Spycatcher comic or distasteful, from inside the service attitudes are of the deepest disgust and an uncompromising linking of such oath-breaking to treachery.

There is a new ingredient—and I am glad that the noble and gallant Lord, Lord Carver, made such a point of it—which has brought its own particular issues of values and beliefs. I am talking about the colossal increase in data processing requirements. The word "increase" is not strong enough to describe what has had to happen. More descriptive, the explosion in computing which has hit any organisation dedicated to information has, we can assume, been even more influential in these services.

Recruiting and assessing the staff needed for this will have put new strains on the service resources and this will have been felt most acutely in the technical arms such as GCHQ. There was a risk—now passed, I hope—that recruitment into the scientific side took place in a different framework of attitudes from mainstream recruitment. Nothing could have been more dangerous. It is easy to be sidetracked into a false philosophy which suggests that scientific truth transcends national interests. But the central mission of the intelligence community is commitment to the truth, any way you want to describe it. The mission is to gather and analyse facts, distilling true information out of distortion and subversion. There is no room to dilute the idea of a traitor, using the excuse of scientific integrity.

The second part of my noble friend's Motion draws our attention to the binding power of the Official Secrets Act. I needed to remind myself of its actual wording and, like anybody who has read it recently, the language strikes me as very John Buchan. There are lots of "harbouring of persons" and "communicating sketches or plans". Like so many of these catch-all legal instruments, there is an after-taste of their origins in expediency. When we debated the intelligence services a few weeks ago, my noble friend on the Front Bench committed the Government to a root and branch review of this Act. I look forward to these proposals when they see the light of day, but I am not in any hurry and I do not think the country is.

The outcry for reform, reform, is not likely, I hope, to result in some string-and-paper piece of legislation. The core of this debate is I suppose: how long can one expect an individual to keep silent about his work? Is the threat of this Official Secrets Act enough? Well, no, it probably is not, but not because silence is an unreasonable expectation but because there is a perception that a person's position is legally ambiguous. In cold legal fact it probably is not at all, but one can understand the feelings of ambivalence which surround the obligation. This leads me to agree with the Motion that a legally enforceable contract can be made a condition of employment. Into this contract absolutely specific and grave personal sanctions could be written—and why not?

As I have been inferring, the selection processes are some of the toughest around. Adding a legally enforceable contract will hardly have aspiring candidates going into shock. I think the evidence is that these services as a career have got to the point of maturity where what we can call "open law" can be calmly applied. I have been asked whether it is fair to request someone to keep silence for all his life. My reply is unvarying: why not? I am not an expert on the intelligence services. If I were I probably would not be standing up in open forum like this today. But I think I am an expert, or getting there, on what to expect from individuals.

Because of my work, I suppose I have interviewed upwards of 4,000 people. They have been of all sorts and backgrounds, many gifted in one way or another. I was thinking about this host of faces in the context of this debate. I was reflecting that if it was made clear to the average, ordinary citizen that he or she must cherish certain facts and take those to the grave, the average, ordinary citizen could be expected to do so.

I believe that bringing clarity to an obligation to keep silent will be welcome, but I also believe that it is a deep instinct in our people to protect what they hold precious. There are not many aspects of this country's safety more important than its knowledge of the world's intentions.

My Lords, I must begin by congratulating the noble Baroness. Lady Hart, who gave a speech which I think showed to perfection the art of being thought provoking without being provocative.

Recruitment is, I think, always a very difficult problem. If you advertise you run the risk of not knowing very much about the man himself or his referees and you may be recruiting a mole—not necessarily a mole for a foreign power but a mole for an internal subversive organisation. On the other hand if you leave recruitment solely to the services they tend to recruit people whose views correspond with their own, and you get one type alone in the service. I think that that was what happened before 1939 in MI6. As a result, that service was not really in very good shape when the war came, because they had not got round to the fact that we were fighting Germany. When the noble Lord, Lord Mayhew, was talking about the recruitment of some of the spies, the odd thing about the recruitment of Philby was not that he had been a communist student at Cambridge. The odd thing was that for his cover he had chosen to belong to the Anglo-German Fellowship and had been a correspondent on Franco's side in the Spanish Civil War.

The CIA advertises, but I believe it would be much better if some arrangement could be made with the Civil Service Selection Board. After all, some of the skills needed, particularly in the security services, are not all that different from those displayed in the old administrative class of the Civil Service. Could not that board give the services a choice of suitable candidates, candidates who had impressed the board as being the sort of men or women for whom the services are looking?

However, the best way to recruit is through dons who have the interests of the services at heart. Sir John Masterman may have behaved exactly like a character out of John Buchan, but as a student of Christchurch he had a very keen nose for the kind of man whom the services needed. I believe that Sir Dick White was one of his protégoés; so, in wartime, I suspect, was Lord Dacre.

Of course things are much more difficult nowadays. There are far too many students for dons to know them individually as they used to, and few dons are bachelors. But I think that every vice-chancellor has a duty to the state to advise the Home Office of members of his academic staff who could help in this matter. They should be the kind of don who can assess character and judge what the services need. That is the first order of persons to be recruited.

I now turn to the second part of the Motion. When Peter Wright published Spycatcher he behaved like the school sneak. It was very natural that the headmistress was determined to punish him. But the rules of Roedean as it was in the 1930s, admirable though those rules were, are not capable of being universally applied. I think that the Crown lawyers gave the Prime Minister very bad advice. Whatever they may have thought the law was, anyone who knew Australia could have told them that an action of that kind did not have the faintest chance of success for the very excellent reason that whatever damage may have been done to our security by the publication of the book no one could possibly believe that it had done much damage to Australian security. As a result the taxpayer was faced with a bill of about £2 to £3 million and I do not think that the incident redounded to the credit of the country.

Of couse we all sympathise with the gut reaction of the Prime Minister on this matter towards Wright's treachery. No one likes to see a four-letter man getting away with it. But sometimes one has to grit one's teeth and not respond to one's nobler feelings.

It seems to me the same may be true of the proposal that the noble Lord, Lord Campbell of Croy, puts forward, which would compel officers of the services to sign a legally enforceable contract. What will they be compelled not to disclose? Where I may differ from the noble Lord is that I do not accept that everything connected with the services should be secret if they are to be effective, for if the services are to be effective they must have the confidence of the public. There are certain parts of their work that the public needs to know about. It is ultimately members of the public, let us never forget, who make positive vetting effective. It is members of the public at home or abroad whom the services need to ask for help in a number of ways.

What is this legally enforceable contract to cover? What is an officer to say to his wife, or a woman officer to her friends, when they are asked what they do? Is that to be something they cannot disclose? Are they to repeat some formula such as, "I work in the Potato Peel Recycling Corporation"? Many officers are bound to have to talk to civil servants, diplomats, politicians and members of the public about their work. Indeed sometimes that is part of their work. I wonder how one can draw up a contract which takes account of that.

My Lords, I am most grateful to the noble Lord for giving way. I think that there is less disagreement between us than he thinks. Of course there are parts of the lives of the people working for these organisations which are not secret, but the point is that what is said by them should be cleared beforehand. That is what is important; not that everything should be kept secret but that what is not secret should be cleared and understood.

My Lords, I fully take the point of the noble Lord. I was just thinking that I was glad that I was not a lawyer having to draw up such a contract. I think that the same principle applies here as to recruitment. Trust is everything. From one rotten apple like Wright one should not deduce that the whole barrel is rotten.

If may of course be said that the contract—I was very glad to hear the noble Lord, Lord Campbell of Croy, say that—would enable officers to publish some books if they wished to but not necessarily others. The CIA has a very sensible rule that an officer may do this provided that he clears it with the organisation. But I share the doubts of the noble and gallant Lord, Lord Carver: when one does submit a book to the authorities for clearance the answer comes back not that a few deletions have to be made but that it cannot be published at all.

I shall give an example of this. Your Lordships may remember an admirable and most entertaining book entitled Ill Met by Moonlight by Paddy Leigh-Fermor. It described how he captured General Kreipe in Crete and eventually got him away by submarine to Egypt. Colonel Monty Woodhouse and others also published books on their experiences in Greece.

One of the officers who was parachuted into Greece, Mr. Nigel Clive, went to the Epirus to operate with Zervas. After the war was over he joined the intelligence service. When he retired he too wrote a book about his time in the mountains. As a loyal member of the services he submitted it to the authorities. They told him that he could not publish it even though he was not a member of the services at the time that he was writing about and like Woodhouse and Leigh-Fermor he was an army officer. Nothing in his book related to any secret matter in the services. I am very glad to say that he published the book.

That is not a good augury. There is this obsession with total secrecy about every single matter. We are no longer living in the age of John Buchan or of Dornford Yates. We are living in the age of John le Carré, who has disclosed a very great deal about the services in his books on spies.

Nor are we for that matter living in the age of Shakespeare. In Troilus and Cressida Ulysses tells Achilles that the Greek high command knows all about the fact that he is having an intrigue with a Trojan princess in Troy. Ulysses goes on to say:

"There is a mystery (with whom relation Durst never meddle) in the soul of state,

Which hath an operation more divine,

Than breath or pen can give expressure to,

All the commerce you have had with Troy

As perfectly is ours, as yours, my Lord.

And better would it fit Achilles much

To throw down Hector than Polyxena".

The mystery in the soul of state is of course the secret service and "relation" is Shakespeare's word for the press. But of course the press durst meddle today with the services only too readily. If a Cabinet Minister was discovered by MI5 to be having an affair with the daughter of a member of the Politburo, Private Eve would be onto it before the director general could walk round to No. 10.

No one could be more determined than I am to stop journalists like Mr. Duncan Campbell from getting information. I should like to see him thwarted on every occasion. Mr. Campbell was a friend of Philip Agee, the defector from the CIA who made public the names of all CIA and MI6 officers that he knew. Mr. Campbell does not care whether the information he unearths is sensitive and valuable to organisations hostile to this country. In fact my impression is that he rather prefers it to be so.

But the services need to maintain relations with the media like any other department of government. It would be much better if the heads of the three services were publicly known, as they are in America and in the Soviet Union. Then they could deal with the legitimate interests of the press in their activities.

There is one other thing which I think is important for the heads of the services to be able to do; that is always to be able to restore, if necessary, the morale of the officers who work under them. Where officers are publicly named— they may have retired—as being this or that, and when totally false statements are made about them, I think that the head of the services should be able publicly to defend those officers.

We are all grateful to the noble Lord, Lord Campbell, for having aired the matter. I hope we shall explore further the possibilities and the difficulties of obtaining binding contracts for officers in the services. However, such contracts run the danger of being absurd. I am bound to say that the noble Lord, Lord Mayhew, was right when he said that no contract would have stopped a man like Peter Wright doing what he did, nor would it have caught the infamous spies recruited by the Comintern in the 1930s.

My Lords, I shall start by congratulating the noble Baroness, Lady Hart of South Lanark, on her maiden speech. I have heard her speak many times in another place and have always enjoyed it. I have not always agreed with her and I expect that when she becomes more controversial as time goes on I shall again not agree with her. However, I am delighted to congratulate her on a most interesting performance.

The noble Baroness referred, as have others, to freedom of information and a possible freedom of information Act. A number of people—not the noble Baroness but those outside this House— have spoken of the right of the public to know practically anything that they wish to write about. That demand comes, not widely from the press, but from certain sections of the press. I get very bored with that.

I do not know whether any of your Lordships have asked a journalist to tell you where he got his information. He will not do it. No journalist will ever reveal his sources. In fact, journalists have been know to go to prison rather than reveal their sources. It seems to me that even those who call most loudly for the right of the public to know to be honoured should also accept that there are certain things that cannot and must not be disclosed. I believe that your Lordships as a whole will agree to the elementary proposition that the operations of the security services must not be disclosed. In that matter, the right of the public to know does not exist. The reason is that the objective of the security services is to thwart those who wish to take over this country by means other than the democratic process, whether by invasion or by attack from within. The vital prerequisite for thwarting those activities is intelligence. Intelligence must be gathered almost entirely from people who do their utmost to make their plans in total secrecy.

Many of your Lordships will be more familiar than I with the detailed workings of the intelligence services. However, I know something of some of the organisations which occupy the attention of those services. I am thinking particularly of two organisations in Ireland—the Provisional IRA and the Irish National Liberation Army. We must never forget that it is the publicly declared intention of the Provisional IRA to overthrow the Government of Northern Ireland and, incidentally, that of the Republic of Ireland as well, and to replace those governments with itself. Its methods include the killing of innocent people, the destruction of property and the extremely ruthless way in which it deals with people whom it suspects—not proves but suspects—of having given information, sold information or perhaps just leaked information about what it is seeking to do.

Gathering intelligence about the objectives of those organisations is extremely difficult and extremely dangerous. Thank goodness there are people who are prepared to do that and also that those people are efficient enough—not necessarily all the time but occasionally—to thwart their intentions. One such incident took place, as we know, in Gibraltar recently. I shall say nothing about the denouement of that operation because it is the subject of inquiry by a coroner's court in Gibraltar. However, it seems to me that the whole operation of discovering what was intended, identifying the people who were going to do it, keeping them under surveillance for months at a time and co-operating with the intelligence services of other countries reflects the greatest possible credit on the intelligence services both of this country and of the other countries concerned. Mercifully, because they were successful, scores and perhaps even hundreds of innocent civilians and soldiers are alive today who would otherwise be dead.

I do not know and do not want to know how that was done. The thought that how it was done and the details of the operation might conceivably some day he made public horrifies me. Recent history tells us—does it not?—that things are not going to stop there and that other plots will be made. I think that no one, for whatever reason, ought to be permitted to make the task of thwarting future plots more difficult and dangerous by revealing, even after some years, how that particular plot was thwarted.

We must face two questions. The first question is what we want to stop people from publicising and the second question is how that should be done. The question of what we wish to stop is difficult. The noble and gallant Lord, Lord Carver, spoke from his great experience in the Ministry of Defence when he said that it regards anything—even the number of lumps of sugar that the Secretary of State has in his tea—as being absolutely top secret. I know exactly what he means; everything is thought to be top secret. That is unreasonable. However, I do not go along with him in his suggestion that there ought to be an independent body advising on such matters.

The question is whether any piece of information is damaging to our national security. Who can decide that? It seems to me that only a Minister of the Crown—in fact, the Prime Minister, who is the ultimate head of all the security services—can decide such matters. What independent person can judge that? An independent person does not have the detailed knowledge of what is going on. Furthermore, if a judgment is made and is thought to be wrong, an independent person cannot be challenged. However, the Prime Minister can be challenged, and that is what Parliament is for. A Prime Minister or any other minister can be challenged on the exercise of judgment and, if necessary, dismissed. That cannot be done with an independent person.

In the end, it seems to me that we must leave those matters to the executive of the day. However, I absolutely agree that there ought to be a much clearer definition of what is or is not a matter of state security. Some people undoubtedly go too far in regarding everything as secret when it is not. How does one stop that? The people who stop it are nearly always the members of the security services themselves. Nine hundred and ninety-nine out of a thousand people—no, more than that—would not dream of ever giving publicity to something which they should not. We must not forget that. We talk about people stepping over the line. However, we must not forget that tens of thousands of people do not. They are the best weapon to ensure that that does not happen.

However, there will always be the odd rogue; there always has been and I have a nasty feeling that there always will be. How do we stop that person? My noble friend Lord Campbell of Croy spoke of an enforceable legal contract. I agree on that matter. However, I thought I understood him to speak of copyright, and there he lost me. That seems to be an entirely different kettle of fish. I prefer to the forthright pronouncement of the noble Lord, Lord Mayhew, who said that such people ought to be behind bars. I think that that is a better arrangement.

The precise wording of any contract is something which I should not be competent to spell out. What is clear is that the existing Official Secrets Act and the signing and acceptance of that Act by members of the security services is not always enough. We know that the Government are considering the Official Secrets Act. I understand that we are to have a White Paper some time later this year. I ask the Government, when preparing any proposal to strengthen, revise and replace the Official Secrets Act, to pay the most careful attention to ensuring that there is a provision in it which will ensure (so far as the law is able to do so) that no member of the security services is ever allowed, whether he is still serving or retired, to put at risk both the other members of his service and, in the end, the safety of all the citizens of this country.

My Lords, I am most grateful the noble Lord, Lord Campbell of Croy, for giving us the opportunity to talk about confidentiality in regard to the security services. I was taught that the affairs of the secret service must remain secret, otherwise the whole objective would be defeated. I am glad to say that in my 40 years of public service confidentiality was the strict rule. Anyone whose work necessarily brought him into contact with the security services was expected to keep his mouth shut and not to discuss their business with any person who did not have a need to know. This applied not only during one's working life but in retirement. The same rule naturally applied to members of the security services. It would have been regarded as unthinkable that a member or ex-member of a security service should speak or write about his work. Today, however, we have a new situation in which members of the security services are being encouraged by the media to write or to speak about their work. This is surely deplorable.

I was abroad and unfortunately unable to attend the debate in the House on 10th February. However, I was very impressed by the excellent speech of the noble Lord, Lord Hankey, in which he said:

"There has been an inexcusable lapse of national discipline".—[Official Report, 10/2/88; col. 220.]

We are not at present allowed to discuss the Spycatcher case since it is sub judice, but I have been greatly heartened to note that all the judges both in the High Court and in the Appeal Court unequivocally endorse the view that members of the security services, whether still serving or in retirement, have a duty of confidentiality to the Crown. I suggest, as mentioned by other noble Lords, that a very good example of the vital importance of secrecy is the operation recently carried out in Spain and Gibraltar. One loose word could have ruined the whole operation; or of course would the co-operation of the Spanish police have been forthcoming if they had not completely trusted their British counterparts. The work of the secret service must be kept secret. On that I think that we are agreed. The content of its work is fascinating to the layman. Of course people wanted to read Spycatcher once it was published, but the point is that such books should not be published.

How this is to be achieved, which is the nub of today's debate, must eventually be the responsibility of government. As I said, I was brought up in a very strict school, and I remain slightly shocked that it should be thought necessary for members of the security services, for whom I have the highest regard, to be required to sign a legally enforceable contract of silence, but if today this is necessary to enable them to resist the blandishments of the media, so be it. What is important is that we should have complete confidentiality in regard to the work of the security services of this country. I shall be interested to hear in due course what the Government propose to do about the problem.

My Lords, the House will be indebted to the noble Lord, Lord Campbell of Croy, for three things: first, for having introduced into your Lordships' Chamber a most valuable debate; secondly, for having given the House the opportunity to hear the maiden speech of my noble friend Lady Hart of South Lanark; and thirdly, for inspiring the noble Lord, Lord Annan, to recite from Troilus and Cressida in a manner, dramatic as it was, that would have been worthy of the noble Lord, Lord Olivier, whom, unfortunately, we so rarely see these days.

In an attempt to draw together the threads of this interesting and important debate, it may be of advantage to start with the matters on which there appears to be universal agreement in the Chamber. The first is the necessity for having the intelligence services for the security of the state. The second—even though there may have been some sad exceptions to the rule—is the obligation to the members of those services for work well, loyally and truly done. The third matter of agreement is the need, where it is appropriate, to ensure that there is no divulging of secrets learnt in that service to the detriment of the realm. It is in regard to that last part that a discussion can be started which I hope will be useful to the Minister when he replies.

My noble friend Lady Hart of South Lanark posed a question about loyalty: she asked, loyalty to whom? Your Lordships may think that, within the confines of the constitution that we treasure, the loyalty of the intelligence services may well be seen to belong to the Crown, which represents the safety of the realm. Within our constitution there is a remarkable concept which I believe has the admiration—certainly in its title—of nearly every other country in the world: Her Majesty's Government and Her Majesty's loyal Opposition. Your Lordships may well feel in the circumstances that that concept has to be borne in mind when considerations of this kind are being discussed in the House.

Perhaps I may start with a discussion about whether the existing law is in the slightest degree clear in order that the White Paper, the publication of which is anticipated in June, can be written with some clarity as to what that law is. Only two days ago an honourable Member in another place, whose name has been referred to in your Lordships' House this afternoon with respect, Mr. Richard Shepherd, asked the Attorney-General whether it could possibly be desirable to have a lifelong undertaking about confidentiality when such matters as treason, fraud and other criminal acts might be involved. The reply of the Attorney-General on 14th March at col. 855 of the Official Report of the other place is:

"The first thing to establish in these difficult matters is the law of the country. My hon. Friend is aware that considerable importance is attached to the fact that former and serving members of the security services owe a duty to the Crown".

I observe that the lights in the Chamber have dimmed. I think it is quite intentional that I be prohibited from reading the quotation, though I do not accuse the Attorney-General of taking any part in the occurrence.

The passage continues:

"The question of whether that duty is owed in all circumstances, including the circumstances to which my hon. Friend has referred, is before the courts at the moment. We shall have to see what the House of Lords says when it hears that appeal on 7 June. Then will be the time to consider what, if any, changes should be made to the law by other means".

I noted that the judgment in question was to be given in June and equally—the Minister will correct me if I am wrong—that the White Paper was promised for June. I wonder whether that White Paper will have the clarity that it ought to possess when the Attorney-General himself appears to be waiting until June for a judgment of the House of Lords in order to decide whether the issue of confidentiality is applicable in the circumstances to which we have been referring this afternoon.

It was suggested very clearly by the noble Lord, Lord Campbell of Croy, that an answer might lie in a lifelong contract of silence required from members of the security services—a statutory obligation which your Lordships may be relieved to know does not occur in the Life Peerages Act. It seems to me that reliance upon a contract as the sanction to stop wrongful disclosures of the kind that we have been hearing about suffers from certain deficiencies.

First of all it invokes a civil remedy and, as most of your Lordships will know, as a rule a civil remedy can be the subject of argument. The matter is neither decided suddenly, as is a criminal act which upon conviction is immediately followed by punishment, nor decided by jury. It is decided as a question of law and interpretation with rights of appeal that often take a very long time to be heard. Therefore, would a contract as such be the appropriate remedy in this case when it is perfectly obvious that the people whom we are anxious to go for (if I may use that expression) are not likely to be deterred by the issue of a civil writ or even an application for an injunction which may lead to proceedings for contempt of court? Would that be sufficient? Is it applicable?

Other speakers in this debate have raised the very important consideration of whether there ought to be a contract of complete silence for life, quite apart from the issues that were raised through the Attorney-General the day before yesterday, as mentioned in the passage that I read out, concerning questions of fraud, treason and other matters that obviously ought to be divulged. I suppose that the answer to the second point might be, "Well, happily, there is now a situation in which proper reports and complaints can be made to a new ombudsman, Sir Philip Woodfield, who is the Staff Counsellor"—that is the title that he has been given. Although many noble Lords asked for a tribunal to be set up almost in the way suggested by the noble and gallant Lord, Lord Carver, in the context of his speech, at least one could be grateful for the fact that something existed by way of an institution to which certain complaints could be made. I hope that that situation is working out well.

However, in a previous debate I raised with the Minister the subject of the availability and ease with which complaints or worries of that kind could be made in future to the Staff Counsellor and I asked him whether it had been made abundantly clear to members of the security services that they had nothing to fear by way of any adverse circumstances happening to them as a result of going to see the Staff Counsellor or of communicating with him about any matters which were thought to be going awry in the security services.

The Minister was courteous enough, as he always is, to reply to me by letter. I have his consent to read out to the House that reply:

"As I indicated in the debate, the Staff Counsellor keeps confidential the identities of individuals who approach him when they so request it, unless security considerations determine otherwise. As to the ease with which Sir Philip Woodfield may be consulted, all members of the security services have been advised exactly how he may be contacted in complete confidence. The method of approach is simple and direct.".

I know that the noble Earl will not think me ungrateful if I say that that was not a reply to the question that I put. I am quite sure that it is made clear to the members of the security services that they will have easy contact with Sir Philip Woodfield. What this House wants is an assurance that it will be made abundantly clear to members of the security services that they have nothing to fear from bona fide communication with Sir Philip Woodfield when they feel that anything is going wrong or that something should be brought to his attention which it would not be sensible, convenient or whatever to bring to the attention of a superior officer. I believe that that is a most essential matter.

In your Lordships' House it never does to make a speech which consists entirely of negative pronouncements. Therefore noble Lords are entitled to ask whether there is any positive contribution that can be made to the question of how to stop the kind of conduct which I believe is found objectionable by all sections of the House; namely, blatantly making money out of what are supposed to be Crown secrets and secrets which are obviously a matter of great importance to the security of the Realm.

The only answer that I can give is some sensible substitution for the ridiculous Section 2 of the Official Secrets Act. Clearly we must not be too insular in our concept of what we are trying to stop. I hope it will be agreed that action must be limited to matters which quite definitely affect the security of the state, whether they are matters of terrorism or concern the enemies or potential enemies of this country. Noble Lords may immediately say, "Well, it may very well be that you have some sort of definition in a new Official Secrets Act which will commend itself to Parliament. But what will be the deciding factor as to whether or not that situation has been created and whether there is a breach of its provisions?" I can see no alternative. A Minister who is responsible for these matters has to take the view that the provisions have been breached and to obtain the advice of the Law Officers of the Crown and the Director of Public Prosecutions as to whether an offence has been committed.

The answer to the most interesting and important question raised by the noble Lord who introduced this debate must be that it is a matter of criminal law and not of civil rights. It must be the criminal law that protects the public, who are entitled to know, and to know especially, about matters which are already within the knowledge of an enemy and other countries and their media, but who are not entitled to know matters which affect the security of the state in cases where that security may be impinged upon should publication take place.

My Lords, we have had what I believe has been an extremely interesting debate which has produced a lot of very constructive, thoughtful speeches. It is always a privilege to speak after the noble Lord, Lord Mishcon. It is always a quite alarming prospect. He speaks with total clarity. He seems to speak without any notes. There was this evening a touch of H. M. Tennent about it. The lights went down as he spoke—no reflection on what he was saying—and then they went up again. The noble Lord, Lord Mishcon, continued unperturbed, purposefully and faultlessly. I admired that.

My noble friend Lord Campbell, in introducing this debate this afternoon, kindly said that he did not expect any answers. I commend that helpful approach to noble Lords who wish to put Questions which I have a responsibility to answer! I also enjoyed the speech of the noble Lord, Lord Annan, not only for its content and his memory, but because of his method of delivery, which, rather like the noble Lord, Lord Mishcon, made me feel that I had momentarily been transported to Stratford-upon-Avon.

The debate was also remarkable because of the maiden speech of the noble Baroness, Lady Hart. Our acquaintance, regrettably for my part, has not been a deep one, but we met when we both sat on the Armitage Committee for the political activities of civil servants way back in 1977. When the noble Baroness joined herself in happy harmony today with my noble friends Lord Home and Lord Lauderdale, and referred hack to 1931, I thought that she was a little on dangerous ground. I was glad that it was only the aggregate of service to Lanark to which she was referring and not to the aggregate of service.

The noble Baroness managed with remarkable restraint to contain the natural tiger of controversy which she always has, and which is always ready to leap out at any possible opportunity, although it did not do so today. It is that natural tiger of controversy that gives the noble Baroness her remarkable character. We look forward to hearing her on many occasions when doubtless the tiger will emerge a little further than it did today. However, we were glad to see her here among us.

If I say that I am grateful to my noble friend Lord Campbell of Croy, noble Lords will understand if my gratitude is muted. I am of course glad to have the opportunity to underline that in our view the essential national interests of this country must impose upon every member of the security and intelligence services a lifelong duty of confidentiality. I was glad my noble friend Lord Campbell underlined that the need for essential and secure intelligence for the protection of our country and our citizens should continue.

However, noble Lords would not expect me to give a seminar on how the security and intelligence services set about recruiting people to their staff. To set out such matters in detail would provide valuable information to those who are hostile to our country. Your Lordships will understand why I cannot therefore respond in detail to those kinds of questions which have been raised during the debate.

Your Lordships are aware that the Government are, and have been, involved with a number of legal actions in order to protect confidential information. There is a simple, fundamental and vital principle which must be preserved: that members of the security and intelligence services have a duty to the Crown not to disclose any information which they may have obtained during the course of their employment, unless they have first received authority to do so. That obligation must obtain whether they are in active employment or retired.

Of course there is the point to which the noble Baroness, Lady Hart, referred. She said that there is the right of freedom of information and the requirement of confidentiality. I was glad that she underlined the necessity for confidentiality. It is a difficult balance to keep and the needle on the public meter is perpetually hunting to try to find the correct balance.

My noble friend Lord Campbell's Motion refers to a contract. The noble and gallant Lord, Lord Carver, found this matter interesting. The noble Lord, Lord Annan, thought that such a contract would not work. I was interested in the controversy which that proposal produced. I prefer not to follow that controversy. Using that word "contract" puts one in some difficulty. The question of whether there is a contractual relationship between the Crown and its servants is at present before the courts. It would be wrong therefore for me to go too far down that road today.

However, I think that most sensible people would readily understand that the nature of employment in the security and intelligence services, and the requirements of national security, demand that there is a duty of confidence and that this must be respected. The duty, if it is to make any sense at all, must continue to apply throughout an officer's life and it cannot end with retirement.

I was glad to hear my noble friend Lord Colnbrook, with his wide experience, reinforce this point so strongly. I was especially glad to hear the suggestion be made at the end of his speech—that in future, if any alteration of the law is going to be made, it should not permit anyone to put his country at risk. This was a very helpful suggestion which I shall draw to the attention of my right honourable friend. I doubt whether there is anyone who can imagine a security service working effectively on any other basis. To suppose that any security service could operate effectively without such confidentiality is, frankly, to wander in the realms of pure fantasy.

I was glad to hear my noble friend Lord Campbell acknowledge the crucial need for the duty of confidence in the debate which we had on 10th February. He said that the security and intelligence organisations must operate in secret if they were to do their job. He went on to say that almost everything connected with their work must be secret if they were to be effective. I am bound to say that I concur 100 per cent. There is no other way.

There is much talk about open government these days. That is very important. But there is one matter about which there cannot be openness. That is the security and intelligence services. The fact is that no organisation can operate effectively if its employees are able to disclose publicly any or every piece of information with which they are entrusted. This is true in the commercial world. It is true in the work of government departments. It is axiomatic in the work of the security agencies.

Unauthorised disclosures by those who have the privilege of privileged and secret knowledge can do untold damage. My noble friend Lord Campbell reinforced this. Bit by bit, these disclosures can assist hostile countries and can enable groups and individuals to build up a picture of our security arrangements which may be unanticipated by those who divulge apparently innocuous information. The disclosure of sensitive material, sometimes in innocence, can alert, for example, terrorists and put the lives of others at risk. Unauthorised disclosures damage the confidence in the security service of those who deal with it, they jeopardise its access to intelligence of what might be of crucial importance to this country. I was glad that the noble Lord, Lord Moore of Wolvercote, referred to that in what was a meritoriously succinct speech.

Such disclosure damages the confidence of our allies in our own country. It creates a reluctance to share knowledge. It destroys trust and it risks lives. There is nothing whatever to be said in favour of it other than for those people who find it a virtue to criticise any government or country for holding a secret.

There are certain things in every family, in every business and in every person which have to be kept secret. A country is no different. There are some parts of our national life which have to remain secret. Those who hold these secrets are in a unique position of trust. The noble Lord, Lord Birdwood, had strong words for those who break this trust. They debase themselves. They debase their personalities and their characters and they let down their countrymen when they break that trust.

Our insistence on the duty of confidence is not a question of trying to stifle a free press. We are not engaged in seeking to foreclose parliamentary discussion about security matters when Parliament has a legitimate concern to express its views. If the record is studied, it can be seen that there has been a remarkable history of frankness in your Lordships' House and in another place on that.

I was interested to hear the suggestion of the noble and gallant Lord, Lord Carver, that there should be a tribunal to vet requests to publish. My noble friend Lord Colnbrook dismissed this idea as being unrealistic. I shall certainly draw this to the attention of my right honourable friend the Home Secretary, but I have to say that the Government remain strongly of the view at present that members of the security services should not reveal details of their work, even if they have been retired for a number of years. The information can still be highly valuable to those who are our enemies.

My noble friend Lord Campbell of Croy referred to the Official Secrets Act. This has come under much public criticism. The Government accept that it needs to be reformed. My right honourable friend has said that the Government's proposals for the reform of the Act will be set out in a White Paper which he hopes to lay before Parliament in June with a view to early legislation. The noble Lord, Lord Mayhew, tweaked the Government for not wishing to see Mr. Shepherd's Bill, the Protection of Official Information Bill, go through. He asked why. Perhaps I can tell him.

Matters relating to official and national secrets are of a highly sensitive nature. We take the view that the Government, whose responsibility it is in these spheres to protect secrets, must take the initiative in putting forward proposals for alteration. Had a Bill been put forward by a Private Member, the Government would have to be in a position of responding to all the various arguments and all the various amendments put down to it—and which would inevitably be put down to it—at a time when the Government themselves have not made up their minds.

The Government are considering the matter. They are considering all the views. They will consider the views which have been expressed today. At the end of that, they will produce a White Paper. There will then be discussion on the White Paper, no doubt inside Parliament as well as outside Parliament. Then there will be a Bill and there will be further discussion. That is a reason why, in order to get this right, we felt that that was the right course to take.

The noble Lord, Lord Mishcon, referred to what was said recently in another place. I can assure him that if anything emerges on the Lords appeal in the Wright case which needs to be taken into account, it will be.

We have embarked on a work to identify a suitable replacement for the Official Secrets Act 1911 because we want to see information which is of importance to the safety and the security of the nation protected. Everyone agrees that the present legislation is nearing exhaustion. It is too wide and it is too weak. The proposals will come in this White Paper and there will be opportunities for debate on it.

At the heart of my noble friend Lord Campbell's Motion is the proposition that more can and should be done at the time of recruitment and appointment in order to ensure that the confidences which are obtained are not broken later. My noble friend made the interesting suggestion that the law on copyright should become involved. My noble friend Lord Colnbrook, in a happily confessional way, said that he was lost when that suggestion was put forward. I do not blame him, and I do not propose to pursue the thoughts of copyright too far this afternoon.

I believe it is premature at present to talk about possible changes in the law. We shall first have to see what the final outcome will be of the legal actions which are now in train concerning the duty of confidentiality. That will be the time to consider what, if any, changes should be made by any other means. I do not think it will surprise any of your Lordships to know that the Government have been considering whether any other measures would help to uphold the duty of confidentiality which is imposed on public servants. We will obviously want to consider carefully the interesting points which have been made from all sides of the House this afternoon.

My noble friend Lord Campbell has argued the need for a legally enforceable contract to be entered into. While I cannot say too much about that, I thought it might be helpful if I let your Lordships know what is being done already. The position is this. On joining the security service new entrants are given a comprehensive briefing on the need to protect classified material and to respect the duty of confidentiality. They are required to sign a declaration that they are aware of the implications of the Official Secrets Act.

The matter is not left there. Staff are regularly reminded of these requirements by their line managers and by their personnel officers. They are also reminded of this during the periodic reviews of their security clearance. Getting the recruitment stage right is obviously one vital step towards ensuring the loyalty of staff. In recruiting its officers the security service spreads its net widely in order to encompass a broad range of backgrounds, of experience and of skills. There is a particular need to look for people who possess the qualities of reliability and discretion which are required for the handling of the sensitive matters with which the service deals.

Your Lordships would not expect me to go into a detailed description of the selection procedures, much as this might whet the appetites of the curious. Let me just say that the selection procedures which are employed are geared to the special need for reliability and discretion, and a variety of selection methods are used.

Any organisation must see that it gets its management procedures and structures right, not least in the interests of securing the loyalty of its staff and their respect for each other, as well as their respect for the position of trust which they enjoy. Improvements have been made recently. Your Lordships will remember the Bettaney case. The Security Commission's report was presented in 1985. It made certain criticisms and recommendations on the management of the security service and in the field of vetting in the light of that particular case.

As a result, the director general prepared a report on changes in the organisation and management of the security service. The report was shown to the Security Commission. My right honourable friend the Prime Minister, my right honourable friend the Home Secretary and the Security Commission have paid tribute to the amount of thought and effort which the security service devoted to this task.

The process has continued. The style of management has become more open and the procedures which affect the appraisal of staff, their postings and promotions, have all been reviewed and improved so that proper attention is paid to career planning and development. As a result, morale, which is so vital in a service that by its very nature cannot generally defend itself in public, is good. Changes which were promised in the field of positive vetting have also been made and more investigating officers have been recruited.

Your Lordships have referred to the post of the Staff Counsellor and it may be helpful if I explain the part which he plays in these arrangements. One of the concerns expressed in recent years—and the noble Baroness, Lady Hart, referred to this—was that members of the intelligence and security services who were troubled over particular matters and activities should have a means of going outside the ordinary management structures in order to have those anxieties considered. My right honourable friend the Prime Minister asked the director general of the security service to consider the proposal and to let her have some recommendations on the subject. The appointment of Sir Philip Woodfield as Staff Counsellor for the security and intelligence service is the result of that consideration.

The appointment of a Staff Counsellor complements the other changes in management of the security service. Sir Philip is available to be consulted by any member or retired member of the security and intelligence agencies who has anxieties—anxieties which relate to his or her work and which have not been possible to allay through the ordinary processes of discussion with line management. He provides an opportunity to talk in confidence to someone who is senior and knowledgeable about the background but does not have the day-to-day responsibility for operations and is independent of management structures. He can be valuable both to the individual member and the well-being of the service as a whole and act as a safety valve.

The noble Lord, Lord Mishcon, referred to a letter which I sent him and he said in that courteous way of his that I had not actually answered the point which he was addressing. If the letter did not do so I apologise to him because I would not wish him to think that I had deliberately not answered it. He wanted to know whether people in the intelligence services who took the opportunity of seeing Sir Philip Woodfield would be able to do so without fear of any retribution. I am happy to reassure the noble Lord that people who go to the Staff Counsellor in good faith have nothing to fear.

My Lords, perhaps the noble Earl will forgive me. I am sure that that is absolutely right. However, I want to know, as other noble Lords may, whether members of the security and intelligence services are aware beforehand that that is the position and that is not just a statement by the Minister. In other words, are they so informed?

My Lords, I take the noble Lord's point. I will ensure that, if they are not so informed, they are informed. I realise that that is a very genuine and real anxiety and it is important that members of the security services should know that if they wish to avail themselves of the services of Sir Philip Woodfield they may do so in good faith without fear.

I tried to explain to your Lordships some of the improvements that have been made recently in the security services. I am grateful for the support which has been given this afternoon from all sides of the House to what is a vital and frequently dangerous task and is undertaken by our security and intelligence services with remarkable vigour. I was grateful to my noble friend Lord Campbell who put that so forcibly at the end of his speech. That support will be appreciated by those who undertake this difficult and dangerous work on our behalf. Of course we shall study the suggestions which have been made by your Lordships with great care. This is an important subject. There is a White Paper coming out in the future and we shall listen with care both now and in future to the suggestions made as to ways in which we can improve these services.

My Lords, I rise briefly to reply to the debate although we are well within our time limit. I thank all speakers who have taken part and I particularly congratulate, as others have, the noble Baroness, Lady Hart, on her maiden speech, made with a fluency with which we were all familiar in another place. We look forward to hearing her many times in this House.

I should like especially to thank the Minister for imparting to us what he felt he could on this sensitive subject. I understand the difficulty about present legal proceedings to which he referred, and that is one reason why I did not press him for information or replies.

I should like to ask one or two questions. First, the noble Lord, Lord Mayhew, asked me about the proposal for a contract and its relationship to the coming legislation which aims to replace Section 2 of the Official Secrets Act. My proposal is not intended to be contrary to any Bill that comes before Parliament. I hope that the ideas that I have put forward are in tune with the legislation of which the White Paper will be the forerunner.

I should like to point out that the new legislation is likely to cover the whole public service, as did the Official Secrets Act. Therefore, it will be used in many departments where there is very little secret work being carried out. However, the organisations which we have been discussing today operate in complete secrecy so that they are a special group and I hope that arrangements for them will be in tune and within the ambit of the new legislation to replace Section 2.

I should say for the record that it was twice suggested that Burgess was a member of one of those organisations. His position was simply that of a temporary employee of the Foreign Office, having come from the wartime Ministry of Information, and at the time the Foreign Office personnel department had for some period been trying to part with his services and terminate his work because he was unsatisfactory in so many ways. Far from being recruited by our service, he must have been recruited by a Soviet service. However, he was not a very good recruit for anybody.

The noble and gallant Lord, Lord Carver, contributed suggestions on the care needed in recruitment and training. I am sure that the Minister will take those into account. I was delighted that the noble Lord, Lord Annan, was able to take part in the debate because he had previously told me that he might have to be abroad. What a loss it would have been to have been deprived not only of his contribution but also the tour de force of that extract from Troilus and Cressida. He also suggested that dons could be good advisers on recruitment and I am sure that that has also been taken on board.

The noble Lord suggested that contracts are by no means an easy method and I entirely agree with that. I do not suggest that they could be 100 per cent effective. My modest proposal is that it may be a better method for the future than ways which have been employed in the past. I must also make that clear to the noble Lord, Lord Mishcon. With his legal knowledge, experience, lucid thinking and exposition, he has given the House quite a lot to think about concerning the problems of contracts. The Government will no doubt particularly take into account his comments on the application of criminal law required in this field as distinct from civil law.

I hope that government ministers and their advisers will be taking those and other comments made in this debate into full account when preparing this White Paper, which we look forward to seeing in the summer, paving the way for the legislation to replace Section 2. I beg leave to withdraw the Motion for Papers.

Motion for Papers, by leave, withdrawn.

rose to call attention to the state of business education and the role of business schools; and to move for Papers.

My Lords, before speaking about what I have clearly set out on the notes in front of me, perhaps I may say that I am very heartened that I do not find myself in total contradiction of the noble Lord, Lord Peston; for to be in that position as a maiden speaker would be an appalling predicament. As I develop what I wish to say, I hope that your Lordships' House will find that I have avoided the controversial element which is so important in the role that I have to play today.

At the point at which I learnt that your Lordships would be discussing this Motion I recognised that it would be the postgraduate business schools that would chiefly be under consideration today. It is true that the stream of graduates that they produce have to compete in the job market with students from the private sector. The jobs that all those candidates seek may be the same.

My reasons for wishing to speak are threefold: first, because I am a product of a business school; secondly, because I retain a financial interest in a business school, and it is the way of this House that one makes such involvement perfectly clear so that self-interest can be seen; and thirdly, because I try to employ the methods and skills that I was taught at business school in the conduct of a complex business life.

I support the view that there is a need for further thought as to the effectiveness of business education and that we are correct to be considering this Motion this evening. If I have any contribution to make in this debate it is on account of the experience that I have gained at business school—a private sector school. I hope that any observations that I make will not be seen as controversial, bearing in mind the respect that a maiden speaker properly accords to all Members of this House. Further, I trust that I shall not be seen as using this unique and privileged opportunity to promote the cause of self-interest.

I am heartened that moves to draw up and monitor standards relating to further education in the private sector are currently under review. That is overdue. There have been some appalling examples of private schools operating in a manner which I do not believe any Member of this House would wish to see allowed to continue. People who know no better have been afforded an opportunity to attend an educational establishment and what they believe will be a good quality course only to learn to their dismay that it turns out to be very much the reverse. Therefore I support such moves.

With regard to business education in this country, we need to be concerned not only about teaching standards, by which I mean whether those who stand up and teach have some business background as well as merely an academic background. We need also to be concerned about the value of the qualifications gained and the use to which they can be put. I believe that is very important. It is self-evident that there is no benefit in gaining what is perhaps a very difficult qualification to have earned in the first place if it is of little use to you in earning your living.

I should like to make three observations about the private business schools in this country, again drawing only from the experience which my involvement gives me. First, though they correctly receive no public funding, they prosper and generate substantial sums of foreign exchange despite extensive competition from Australia, America, Canada and indeed elsewhere as well. Secondly, they offer a more practical business education. It is in this area that I am so gratified to learn that the noble Lord, Lord Peston, and I have a common view. Consumer response indicates that they are correct to do so. They are totally market driven and must satisfy the customer effectively or close down; there is no safety net.

Thirdly, through the alternative syllabuses which they offer, they teach the student to look at business from a practical as well as a theoretical point of view. I believe that it is necessary to understand the jungle that business really is and not just to be allowed to believe in the model of it; to promote the leadership skills and creativity that are to a greater or lesser extent in all of us. Again, it is very difficult not to agree with the noble Lord when he asks whether it is possible to put entrepreneurial flair into someone if it is not there in the first place. That is a very valid point.

Students of business must learn to bang on doors and find out what it is like to be faced with confrontational issues. One of the problems of the classroom or the lecture room is that the opportunity does not exist to learn what it is like to have to pit your wits—which means your money—against somebody else's. One must learn to develop powers of persuasion, and most of all, as is so often expressed by the government of the day, to see things the way the customer sees them.

So in the private business schools that I have known the student begins to learn both sides of the equation; on the one hand, the experience gained while still a student—and that is the important point; discarding the jeans in favour of the dark suit and getting into the community—and, on the other, learning the disciplined syllabus of traditional management training, the marketing, accounting, statistics and so on, so that the growth and development of the target business can be monitored in the correct way.

I trust that I am correct that this evening we are questioning as a body whether we are making the best use of our resources to serve industry and commerce and, as has already been mentioned, the City, through our business training programme. Perhaps I may say heaven help us if further innovative management systems are discovered next week. The biographies of wealthy, prosperous and successful businessmen are thick with theory on the subject, often in contradiction of each other and yet each able to demonstrate success for its own formula.

I admit that I am not a successful tycoon—or at least I am not a successful tycoon yet. However, for my part, in addition to the study of all the basic disciplines, I advocate employing a maximum of common sense, calling on one's wit and judgment and, as a priority, putting time aside to think before taking those all-important decisions.

I am well aware of the breadth of experience that exists on the Benches of this House and that many noble Lords hold or have held the highest office in government and within our educational establishments. But in deference to this and to the enormous breadth of the subject under consideration, I trust that the House will not view my remarks as those of an advocate of grass-root values without regard to the immense contributions made by the growing science of sophisticated financial and commercial management, as was also mentioned by the noble Lord. I wish merely to propose that it may be beneficial to consider a balancing influence between practical and academic training.

I understand that on occasions such as this your Lordships allow the occasional aside. This may be the best opportunity, or the only opportunity, I shall have of saying with genuine humility how enormously grateful I am for the privilege of being able to speak in your Lordships' House. I am able to do so on account of political and military service rendered hundreds of years ago by members of my family.

I should like to add one point. My father held the title of Marquess of Huntly for 50 years and yet he never came to speak in your Lordships' House. I regret that, not simply on account of common courtesy or as a mark of respect, but because he had the most wonderful speaking manner. He never hesitated over his words; nor did I see him with supporting notes in his hand, whether he was speaking to audiences great or small; although, on reflection, perhaps that could be a reprieve for your Lordships as on almost every subject he held the most outrageous views.

I repeat my thanks to the noble Lord, Lord Peston, for the opportunity his Motion has given me to speak on a subject in which I have such an interest. I hope that some of the points I have made may be seen as helpful in the wider consideration of the subject.

My Lords, it is with great pleasure that I congratulate the noble Marquess, Lord Huntly, upon his very thoughtful maiden speech and his contribution to our debate based on a double experience; that is, his experience as a student at a business school and now as one who is concerned with the running of a business school. Experience of this kind is extremely valuable in the debates which we have in this House. If we can have people contributing who come here with fresh experience, as the noble Marquess has, that undoubtedly adds to the breadth and importance of our discussions.

The noble Marquess has highlighted some of the issues to which the noble Lord, Lord Peston, referred when he introduced the subject in his important speech. Perhaps the major issue—which many of us will be returning to—is the essential need at all times to ensure that in business training, especially in the business schools, there is a proper balance between the academic and the practical. That fact must never be lost sight of. I believe that we are looking at this question at a very important time in the evolution of business training in Britain.

Last year, two important reports were prepared on the subject; the Handy Report and the Constable Report. In his report, Professor Handy compared the state of business training in Britain with that of our main competitors in the United States. Japan, Germany and France. The conclusion that was reached, after a very detailed survey, was that in all those countries they are taking a much more professional approach to the manager, his training, his skills and his qualifications than we are. There are of course centres of excellence in Britain and firms which have a very good reputation for the training of their managers.

However, on the whole, we demonstrate a spasmodic and intermittent approach to the problem, whereas our main competitors appear—at least on the face of the report—to be taking the subject very much more seriously. Therefore we need to consider how we can adopt some of their methods with the intention, eventually, of overtaking them. This is where the second report, the Constable Report, comes into the picture. That was a report which, on the basis of the findings of the previous survey, put forward various proposals for action.

However, before considering those proposals, I think it is worthwhile recalling the evolution of the attitudes towards business training in this country since the war to which the noble Lord, Lord Peston, briefly referred. I have personally been very much involved for many years in a large organisation which tried to develop its management training in a comprehensive manner. I was also involved in the raising of funds for management training in general, and so was fairly familiar with what was going on.

I think we can refer to three periods, the first of which extended up to about 1960. That was a period when very little careful thought was given to the right approach to the problem. Some firms such as Unilever, Shell and also some nationalised industries—I am glad to say because I was involved in one of them—stood out. They paid particular attention to management training. But, on the whole, it was not regarded as a national issue. As the noble Lord, Lord Peston, mentioned, in the early 1960s there was the Robbins Report. I believe it was published in 1963. It recommended the setting up of two major management schools, and that was done, based on the American experience, especially that of the Harvard Business School. I am glad to say that industry, both in the public and the private sector, rallied around that recommendation and funds were raised from enterprises (£5 million in the first instance and another £7 million later on) in order to enable those two centres of excellence and other centres of management training to be set up.

The result of those initiatives is that we now have many centres where the skills of management are being taught, for example, in universities, polytechnics and in private establishments similar to those which the noble Marquess, Lord Huntly, referred to. There is no shortage of places where people are taught management skills but the problem is that there has been no effort to think out a total approach. However, I am glad to say that I believe that this is now being done as a result of the two reports to which I have referred.

A group has been formed under the initiative of the CBI, the BIM (British Institute of Management) and the FME (Foundation for Management Education) to take a new look at the whole status of business training in this country. The group has come to the conclusion that this concept not only needs to be extended in a very big way but that we must take account of the rapidly evolving technological world in which we live.

It is a sobering thought that, of the 2·75 million managers in Britain today, it is estimated that most lack any formal management training. Furthermore, only 21 per cent. are estimated to have degrees of any sort. In the other countries considered, that figure is at least twice as high, so there is a long way for us to go. It is suggested that there should now be established a diploma of skills in management which could create the professional grade of the chartered manager, just as in recent years we have developed the concept of the chartered engineer in order to give more recognition to that vital profession.

It is felt—I must say that I agree with this—that we need to put great effort into creating the concept of the chartered manager; that is, the manager who will have not only the basic skills in management but will also have had a required degree of practical experience. Therefore, if someone describes himself as a chartered manager it will be known immediately by any prospective employer, or anyone he is dealing with, that he has those skills combined with the experience. When this is set up many young people should be encouraged to qualify as chartered managers. That will be the first step.

Secondly, the training of a manager never stops. It is no good thinking, even if this scheme were to be successful—as I hope it will be—that once you employ a chartered manager that is the end of it and he has all the skills he will ever need; that is not true. Therefore a major effort, which will largely be the responsibility of the employer, is required to ensure that there is continuous development in the training of the manager.

As regards the concept of the chartered manager, I think that perhaps the Germans lead the way with their apprenticeship scheme, whereas the Japanese lead the way in attention to the development of management skills. With the knowledge that we have obtained from those other countries and under the momentum of the new initiative that has been taken and very much encouraged by the noble Lord, Lord Young of Graffham, we can gain from their experiences. We can introduce a much broader concept of management training, including the idea of the chartered manager as a basis, and then inculcate throughout industry and commerce the vital need to regard management training as a continuous process, right up to and including the post of chairman.

My Lords, I should like to thank the noble Lord, Lord Peston, for giving your Lordships' House the opportunity to debate a subject that will be central to our ability to compete in the international economy. Following the DTI's enterprise White Paper, the Handy and Constable and McCormick reports, the setting up of the Council for Management Education and Development and the Charter Group, now is an appropriate moment to reflect upon what it is that we are trying to achieve, and how we can best achieve that within the context of the rapidly approaching unified European market in 1992.

Like the noble Marquess, I am a member of a species which has been the target of much criticism from both industry and government. I have a master's degree in business administration, albeit not from a British business school but from INSEAD in Fontainebleau, France. I should also declare that I am a member of the advisory council of the Association of MBAs, previously known as the Business Graduates Association. In choosing to go to INSEAD, I made a conscious and rather un-British decision to learn about how the rest of the world conducts its business and to do so in a school that is deliberately multinational and multilingual. It was a salutary and stimulating experience. MBAs have been criticised in this country for a variety of sins—overweening ambition, theoretical rather than practical knowledge, and a know-it-all attitude. Perhaps so, but many top companies find MBAs highly valuable and are able to forgive them their sins and put them to good use. A glance at the INSEAD address book reveals that organisations such as IBM, Courtaulds, Digital, British Petroleum, Barclays Bank and Procter and Gamble gainfully employ large numbers of my fellow-alumni. Nevertheless, the dissatisfaction felt by much of British industry with the business-school product has led directly to the Charter Group initiative.

I welcome that initiative as evidence that the climate of opinion about business education is changing. The Charter Group code of practice may at last force the boards of large parts of British industry to face up to their management development responsibilities and to acknowledge that a trained and motivated workforce is a vital source of sustainable competitive advantage. I shall find it less easy to welcome the concept of the chartered manager until some important issues have been resolved—issues about which I hope the Minister will be able to comment. I raise all of these issues within the context of 1992 and the absolute—there are no half-way houses—need for us to be internationally competitive.

First, on the concept of the chartered manager much has been said of the need to develop a business education system suited to our insular peculiarities. Unless we are careful, we may produce a wholly British invention carrying neither recognition nor conviction in any other country. I hope that the Government will give vigorous guidance and direction in this area.

Secondly, as to the practicalities of what a chartered manager will be, there appears to be a plethora of potential routes to acquiring chartered status. There is a danger that the quality and content of the courses will be so closely related to particular companies and to their particular industries that uniform standards may be near impossible to achieve, thus devaluing all courses whether good or not quite so good. Will the Department of Education and Science, with its embarrassment of current experience in shaping and reshaping curricula, please undertake to offer solid guidance?

Thirdly, a key point of sucessful management is the ability to take risks. Individuals are more prone to enterprise than institutions or organisations. It is a rare organisation that is able to engender a culture that can profitably and creatively challenge the status quo. Does the Minister agree that outside organisations, such as business schools, have a valuable role to play in lifting management development out of the work place and into an uncomfortable world where traditional beliefs can be recast?

Fourthly, and finally, what of the business schools themselves? For all the apparent irrelevance of a business school degree, the top British and Continental business schools are embarrassed by the paucity of places on offer in relation to the large number and high quality of applicants. I am willing to go on public record as admitting that some MBAs can be a pain in the proverbial; but the vast majority of them are making their way quietly and effectively up through their organisations. They can bring to their place of work a breadth of vision that draws on a pool of knowledge based not on abstract theoretical notions of good and bad business practice, but on a syllabus grounded in theories emanating from empirical observations that are often dismissively described as mere common sense.

Common sense is a valuable commodity. Does the Minister agree that the Government will themselves be lacking in common sense if they do not vigorously encourage and promote the activities of our leading business schools? The year 1992 draws too close for us to attempt to reinvent the wheel. While welcoming the Charter Group initiative, let us not neglect to build on what we are already fortunate enough to possess.

My Lords, I propose to speak on what I believe to be one of the most crucial challenges facing business education today: the education and training of our businessmen to equip them for the Common Market's Big Bang in 1992. That is the internal market to which the noble Lord, Lord Russell of Liverpool, has just referred. It is an attempt to create a single market in goods and services for all EC states by 1992. It is not just that Customs checks are to be abolished and technical regulations for products standardised; about 80 of the Commission's 300 proposals have already been agreed. Those proposals extend from opening up the financial services sector to a general system of mutually recognised professional qualifications; from an end to national bias and public procurement policy to plans for fiscal harmonisation. I pose two questions: will businessmen be adequately trained and educated to meet the challenges and opportunities of the internal market? What steps are the Government taking to ensure that the necessary training and education take place?

The Government have accepted some responsibility. Starting this Friday they are mounting a campaign to increase the awareness of British businessmen of the advantages and opportunities of trading in Europe. I hope there will be more to this campaign than what we know is already planned: working breakfasts—in practice sometimes a contradiction in terms. There is rather more to the education of businessmen about the challenges and opportunities of the internal market than a cosy chat over a good English breakfast, the one matter on which perhaps we have nothing to learn from our Continental friends.

This awareness campaign is apparently to be launched on breakfasts. So also is the promotion of the Government's inner cities initiative, Action for Cities. I ask myself whether a new political issue is emerging—the breakfast issue. I have a vision of policy being lost to sight behind a mountain of breakfasts.

As the European Court has recently put it, the Community is a Community of law. Whether or not we like lawyers that is the nature of the Community of which we are members. Lawyers as a breed are somewhat generally reviled. I well remember at the time of the Industrial Relations Act 1971 that Barbara Castle in another place complained that it would prove to be breakfast, dinner and tea for the lawyers. That seemed to her and to others to be a quite sufficient indictment of the Act. I suppose it follows from that pronouncement of Barbara Castle that a lawyer such as myself should be the last to deny a businessman a good breakfast. But my hope is that the Government have rather more in store than good breakfasts to equip the businessman to trade in the internal market by 1992. I hope that in the reply to this debate by the noble Baroness we may be told what educational substance there will be to this campaign.

A basic understanding of European Community law and practices must be an essential part of any adequate programme for the education of businessmen about the internal market. Businessmen must learn the significance of law and of legal remedies in the Community system. They must understand the significance of competition law; they must know who is the commissioner for competition, what are his powers and what is his policy. They must know what to do if the commission's inspectors arrive on their doorstep and ask to examine their files. They must understand that, if they are obstructed in penetrating a new market by some ingenious non-tariff barrier, they should first think of suing in the courts of the other country rather than rushing off to the DTI or their MP, hoping that he can do something about it.

They must also appreciate that competition in the new internal market of 1992 will mean inward competition as well as outward competition. They must be prepared to meet competition on their own home patch. They must learn that an open market for public procurement means an end to "sweetheart" deals with government departments. There are hard lessons for business to learn if it is not to let itself down and the nation in the process.

I hope that in the reply to this debate we can hear what serious educational content the Government's campaign will have. Above all, if there are to be seminars and courses of instruction, what, if any, use is to be made of the unrivalled expertise of our universities? All our universities now include Community law in their law degrees and some are highly distinguished in the field. One such centre for education in Community law and practice is the Centre of European Governmental Studies at the University of Edinburgh. For 25 years it has been organising seminars on the subject.

It was disheartening to hear its distinguished professor, Professor Edward, a Queen's Counsel with many years of legal practice behind him, as well as great expertise in Community law, complaining recently on the radio that his offer to the noble Lord, Lord Young, that his centre would be enthusiastic in taking part in the process of education for businessmen in the run up to 1992 was brushed aside. The noble Lord wrote to Professor Edward on the subject of the awareness campaign:

"Apart from the national launch, there will be a series of seminars and events throughout the country. We are still in the early stages of planning but I have asked my officials to keep in touch with the programme as it develops and we will let you know if opportunities for your involvement arise".

That was on 16th November 1987. It is now mid-March 1988. Professor Edward of course has heard nothing. I hope that the noble Baroness who will be replying to this debate will inform her noble friend Lord Young that I have called attention to this correspondence.

I think it is a fair comment on the noble Lord's letter to Professor Edward that it should surely not be a matter of the Government graciously considering giving the universities opportunities. The question is whether the Government have the common sense to take advantage of and to encourage business to take advantage of the opportunities which the universities can make available to the Government and to business.

So I ask: are the Government really interested in involving the universities in the education and training of businessmen to make them ready for 1992? Adequate information for businessmen needs a combined effort of government, the universities, institutions such as the CBI and the Institute of Directors and businessmen themselves.

I hope that in the reply to this debate we may be given some detail about the educational content of the Single Market Awareness Campaign to be launched on Friday. We should be told whether the accumulated expertise of the universities is to be drawn on. The law faculties of our universities are particularly adept at constructing courses geared to the needs of busy people. The universities, for example, as their contribution to the Law Society's scheme for the continuing legal education of solicitors in busy legal practice, are putting on special courses to update solicitors on new developments in particular subjects and even to teach them wholly new subjects. The seminars take place at the weekends or in the evenings and are constructed to meet the convenience of those in full-time employment.

I endorse the remarks of my noble friend Lord Peston about the need for our academic institutions to fashion courses tailor-made for particular requirements of business. I see no reason why the law faculties of the universities in our major commercial centres should not design courses in Community law and practice for British businessmen in the run-up to 1992. They should be encouraged by the Government to do so and the Government should encourage businessmen to participate.

Working breakfasts are costly PR. They have the authentic ring of the really phoney. Education, by contrast, is not PR but is substance. So I hope that we shall hear in the reply to this debate from the noble Baroness what precisely, as part of their Single Market Awareness Campaign, the Government will be doing to promote the education and training of businessmen in the run-up to 1992 and to what extent they will ensure that our universities are involved.

My Lords, I put my name down to speak in this debate because I wished to assure the noble Lord, Lord Peston, from these Benches that we share his concern for the promotion of business education. I want to make a general comment and deal briefly with the position in Scotland, for which I assume the Minister has no responsibility whatsoever. Before doing so, I wish to congratulate the noble Marquess, Lord Huntly, on a model speech. I had always associated the title of the Marquess of Huntly with estates in Aberdeenshire and the grouse moors. How delightful it is to see that the noble Marquess is an MBA and a practical teacher in the field of management studies. That I think indicates the changing climate in relation to management studies.

I was interested to read the report of Professor Charles Handy when he made the comparison—to which the noble Lord, Lord Ezra, referred—between ourselves and other countries in the industrialized world in the field of management education. Professor Handy states:

"Management in Britain has traditionally been more to do with pragmatism than professionalism. Common sense, character and background have been thought more important than education, with experience the only worthwhile school. These things are still widely held to be true, but the complexity of modern business and the rising levels of both education and expectation among younger managers have brought demands for a swing towards professionalism."

I believe these words to be profoundly true. They should be learnt. How often have we heard, particularly those of us who have been in business for a long time, the words, "Oh, it just needs a hit of common sense and experience and you are all right"? The companies who take that view and reject professionalism in management very often find themselves the victims of takeovers by companies which have professional managers and can exercise their skills.

One of the factors that affects the changed attitude to management education is inward investment. I have seem this in the Scottish scene. On my doorstep there is a huge factory of IBM. Not so far away is the new Nippon Electronics factory—an import from Japan. If one looks at those successful companies one will see that they have brought professionalism in management into the industrial scene. They have raised the whole standard of management in other neighbouring industries which are competing for employees.

When I talk about the impact of the companies coming in in changing attitudes to professional management, I think that we must recognise that professional management is very mobile and that the competition for management is great. People with the appropriate qualifications can move readily with high rewards to the United States and to other parts of the world where their professionalism is recognised and valued.

If we are going to train professional managers let us be sure that we give them standards that are internationally recognised. The noble Lord, Lord Russell of Liverpool, made that point very strongly.

There is a great proliferation of business schools. I have seen some of the courses and I have sat in on some of the courses that are being taught because business schools have become a big thing in universities. Many universities naturally are taking advantage of this new interest. They are also taking advantage of the fact that by running business schools they can sometimes attract funding from industries which will benefit from the graduates who will emerge. So it is attractive to the universities to have business schools.

I think that the one thing that has been achieved in the United States is a reasonable standard for their MBAs. It is not a uniform standard. It varies a great deal. But nevertheless if one looks at the Handy Report one will see that the United States has four times the population of Britain but over 40 times the number of graduates with business qualifications that we have. I believe that that is an important lesson to learn. Not only must we produce more graduates but we must observe a standard that will be recognised in the market place.

I wish to say a few words about the Scottish scene, where there are eight universities, five of which have reasonable business schools. I underline the word reasonable because the great opportunity that Scotland has missed is the creation of a Scottish Harvard in Stirling University. It is just the right size for that. I found in discussing the development of business education in Scotland that there was a great desire for all the universities to protect their own little patch and their own little group and to have their own little business school.

I believe that in a country the size of Scotland it would be desirable to establish a high standard business school with an MBA which would be universally recognised. I am delighted to see that in Stirling at the present time a school for Japanese studies has been developed. Apart from Sheffield and Oxford it is the only university that has developed such a school in a serious way, as it recognises the importance of Japan in our future industrial development. However, I should like to see a greater co-ordination of business education in Scotland with a view to raising standards and achieving standards that would be universally recognised.

I shall say a few words about the content of business school training. It should not all be about training accountants and producing people who are good at corporate planning. People have to be trained to make things too. Managers are required on the shop floor as well as in the merchant banks. I would certainly stress that point.

I think it was the noble Lord, Lord Peston, who said that too much of the management training is academic and too little is practical. I believe that a balance has to be struck. Indeed I would go so far as to say that in the modern business world and in the modern business school there might be a department which trained students on ethics in business.

I am encouraged by the fact that Sir Hector Laing and some of his peers are encouraging companies to release on secondment some of their young managers to work in inner city development, in urban renewal, and in business in the community, offering advice and guidance to small firms. I believe that a good manager requires experience, sympathy and a feeling for people which goes beyond a purely academic achievement.

Finally, I wish to mention that in my experience of living in the United States I observed that the business schools promoted the principle that their professors and teachers should be actively involved in business. A colleague of mine was a professor of marketing at New York University but he also ran his own business on the side. He had practical experience of applying his teaching there.

It was not uncommon at Harvard to find professors who were on the boards of companies. I believe that it is important that teachers in business schools should not be remote from the industry in which their students are going to practise their skills. They should be encouraged to become involved in the community and also in practical business.

My Lords, we are all extremely grateful for the opportunity which has been given to us for this fascinating debate. The skill and expertise of managers is crucial not just in business, as has been discussed by noble Lords so far, but also in the health service, in local government and in schools, particularly under the impending regime. My noble friend Lord Huntly spoke in his eloquent speech of business schools in the private sector. I wish to speak particularly about open and distance learning for management education. In order to do that, I wish to draw on my experience of the Open University, where I am a member of the governing board. It may be that the noble Lord, Lord Graham, who also has extensive involvement there, will wish to add to what I have to say.

The Open University believes that there are some 2½ million managers in Britain. Of those, fewer than 20 per cent. have degrees or the equivalent. Seventy per cent. of all managers have no training at all for their present positions. The Open University also believes that the average amount of training which managers receive is less than one day per year.

One of the major problems is that managers, by definition, are key people. They make a considerable economic contribution to their firms and they cannot easily be spared. They also do not wish to be spared in order to go off for prolonged training courses. Smaller firms can easily be put off by the cost of traditional courses, and many managers do not live within reach of courses which take place in the evenings. That was one of the reasons why, in 1983, the Open University set up its open business school by means of which managers, wherever they live and whether or not they have any previous qualifications, can study, as all Open University students do, at home and in their spare time. They have available to them at their own firesides high quality and practical teaching on the subject which they want to learn by means of the best of modern distance and open learning techniques.

The response since 1983 speaks for itself. In that year, 998 managers registered for the courses of the open business school. By 1987 the number had risen to 6,372. In less than five years, 18,500 managers have joined courses. Over 22 per cent. were women and 21 per cent. came from businesses employing 100 people or fewer. It is interesting to note that two out of three of those students were sponsored by their firms, with the total of sponsoring firms being no fewer than 2,500.

Until now, that has been done without recourse to public funds, with finance being a combination of fees, support from industry and a welcome grant at the outset from the Foundation for Management Education. That approach has proved so popular that it is being incorporated this year with the help of government finance into a new school of management within the Open University. That faculty will bring together staff who have worked within the existing business school and others who have contributed to management programmes elsewhere in the university. They will work with external consultants from business and other institutions.

The existing courses which have been carried out until now will be used as a base for a professional diploma in management. The DES has now agreed to fund the development of an MBA programme within the next three to five years. It is interesting to note how the Open University's way of working, which operates across all the subject areas for some 150,000 students, is proving to be particularly successful for students of management.

Why is that? First, managers can take part, as can all Open University students, wherever they live, whether or not they have any previous qualifications, whatever their educational background and on the job, without having to be absent from work. They fit the course in with their own home and family lives. The course is especially designed to build on their current and previous experience of work. That Open University way of doing things has proved to be very attractive to management students.

Secondly, it is possible for management students, as for all Open University students, to benefit from the teaching of a wider range of academics and practitioners using a wider range of teaching methods than is often possible for students who attend traditional courses which may be on offer locally. Each Open University management course is designed by a team which is based at Milton Keynes.

In the team there are academics who are usually people with recent practical business experience. They bring together their knowledge of the subject on the ground with their experience of research at the frontiers of the subject and the frontiers of distance learning and teaching methods. Working with them is a BBC production team backed up by photographers, artists and librarians, as well as management practitioners who come in to advise and help. One of those courses may take the equivalent of ten man years to complete, with as many as 50 people contributing. Yet because so many people follow the course, it is possible to set the fees at the full market price and still produce an extremely cost-effective operation.

Thirdly, it is possible to make full use of modern technology in that kind of education. Students learn by means of an ever-developing variety of methods—well-produced and attractive printed materials, television and radio broadcasts, video and audio cassettes, computer conferencing and assessment by computer. People enjoy using those combinations of modern media. Properly delivered, it is extremely effective in management education.

Fourthly, as elsewhere in the Open University, management students each have a local tutor assigned to them. That is a crucial element in the course. They meet the tutor from time to time on their own or with other students in the locality to discuss problems, clarify parts of the course which they do not understand and receive help in relating the course to their current work experience. Students often meet in the absence of the tutor to help one another with problems they come across. The tutor also assesses the written assignments which students undertake. It is important that that is done wherever possible by someone who knows the student personally. The examination at the end of the course can be taken at a centre located somewhere close to where the student lives so that attendance is not too difficult.

Lastly, when a firm or other institution wishes to run a management course in-house, the Open University materials can be provided in a package so that the staff of the firm can assist students to follow the course. I think that is a response to the sort of tailor-made provision which the noble Lord, Lord Peston, called for.

All those ways of working which apply throughout the Open University are clearly especially suitable for management students. It is interesting that at the present time, of those taking courses at the Open University 67 per cent. are between the ages of 26 and 40; 30 per cent. are junior managers; 35 per cent. are middle managers; and 53 per cent. have less than five years' experience as a manager. Forty-four per cent. of all students left education before they were 18. Six out of every 100 have no 0-levels at all, while 31 per cent. have degrees.

What can be learnt from the Open University experience for future management education in Britain? Open entry and distance learning, properly combined, are undoubtedly a very useful way forward. I draw to the attention of my noble friend the proven success in that respect. The Open University has demonstrated that open and distance learning is very much more than having, as it were, a factory at the centre churning out films, cassettes and written material, sending them to students and waiting for the students to respond. There is a large and developing area of teaching expertise in this multi-media approach in representing first-class and up-to-date material in such a way that the student can relate it to his own experience, take it unto himself, make it his own and increase his effectiveness as a manager.

The Open University goes on learning. It is in no way sanguine about its current offerings. The noble Lord, Lord Peston, has made clear the need for more and better management education. It is clear also that the Open University and other bodies with distance and open learning provision have a significant contribution to make. I ask the Government to consider carefully whether there is something that they can do to increase the provision of such facilities in various institutions throughout the country.

My Lords, it is a pleasure to follow the noble Baroness, Lady Carnegy of Lour. What she said was interesting and familiar and must have given great pleasure to the House. It will surely have been particularly pleasing to the first Vice-Chancellor of the Open University, the noble Lord, Lord Perry of Walton. He contributed a great deal to the foundation of that body, which is so well used, and was among the pioneers of the tutorial and academic staff. I am one of a trio of noble Lords who are proud to speak in the Chamber whenever possible on this subject. The noble Baroness, Lady Carnegy, gave an excellent outline of the place of the Open University, thus relieving me of the necessity to do so, for which I am grateful. There are other interests that I wish to serve in the debate.

Can the Government tell us what they are doing and what they have in mind to improve the role of business schools? Perhaps I may develop this a little. I have attended a prize-giving in Edmonton in the last seven days. The prizes were given by Brenda Dean, the eminently respected trade union leader. I sat through the prize-giving knowing that this debate was to take place and wondering how much energy the department is devoting to the objective of producing good British business managers in 20 years' time from among youngsters now aged 15 and 16. Can the Minister say how concerned the Government are not only that youngsters should go on to further education but that, from among today's school-leavers aged 16 and 17, there should emerge good managers for the country?

I have also attended in the last seven days Thurrock Technical College where I was pleased to give the prizes. The college does excellent work of a high standard. The students were naturally proud and pleased to receive their awards in the presence of a great range of representatives of local industry. The college is well endowed both physically and in terms of a dedicated staff. The students afterwards told me some sad news. They said that although they had been well sustained by local industry in their apprenticeships, they were receiving in one hand prizes and awards from local companies and, in the other, their notices because they had been trained without the guarantee of a job. The jobs do not exist. Can the Minister tell us what action the Government are taking to alleviate the frustration and depression not only of young people and their parents but of dedicated staff like those at Thurrock Technical College?

The Open University has evolved gradually. We are indebted to the noble Baroness, Lady Carnegy of Lour, for having given an excellent outline and for describing the progress that has been made. I am particularly interested in what she said about the MBA diploma and the work undertaken in conjunction with the British Institute of Management; one awaits the concept of the chartered manager with optimism.

The Open University is properly called open because it does not lay down criteria that must be met before an applicant can be accepted. If someone wishes to reach the top, it is not necessary to climb over hurdles that could prove difficult for a young person. It is frequently not the large companies that are laggard in regard for training but the small and medium companies. Can the Government confirm that they are taking account of the desperate need to ensure that small and medium companies respond in terms of training and encouragement and in making opportunities available to their employees?

I acknowledge my indebtedness to the Co-operative movement. The Co-operative College at Stamford Hall has much to its credit. I observe that the noble Lord, Lord Taylor of Gryfe, is nodding his head vigorously. He has known the college perhaps even longer than I have. He will be proud of its place in trying to improve the education and ability of working people. The noble Lord, Lord Jacques, my noble friend Lord Gallacher and I are ex-students and graduates of the college. Although I was the first Member of Parliament to be given a degree by the Open University, a Co-operative colleague of mine, John McFall is also a graduate of the university.

It is right and proper that we should have what might be called almost an elite or a cult of elitism. However, it has to be recognised that, even though one can quote impressive figures—numbers growing from hundreds to thousands and to tens of thousands—the acme of perfection may well be seen to be the MBA. It is not the be-all-and-end-all of business education for there is a range of things that can be done, indeed, they are being done by many people.

Documents that I have received from the Open University contain a list of major businesses and organisations that support the business school of the university—Beecham, Boots, the Co-operative Wholesale Society, the John Lewis Partnership, ICI and Nalgo among many others.

I should like to mention a document I have received from the Co-operative College. It might be useful to give some details of that organisation which has developed its techniques and last year earned more than £2 million in consultancy fees advising not only small companies and businesses in this country but also governments abroad. It offers a range of courses: non-food marketing strategies; stocking and selling wines; fresh food in supermarkets; women in management; senior dairy managers; dairy selling; funeral department management; motor trades management; dairy business diversification; and training skills for funeral managers. In a debate that concerns itself with the product of business education and business schools, we should remember to pay tribute to such organisations.

It is a sobering fact that in the retail industry—which is an aspect of industry about which I know perhaps a little more than I do about some other parts—there is a lack of women who rise to the top and achieve management positions. The Government ought to be telling us their intentions in that respect. I should also like to draw attention to the collaboration that exists to improve the quality of management within the retailing industry. I am told there is a consortium of retail teaching companies and that most of the big companies support its aim to improve the quality of retail management education.

There is one final point I wish to make. I happen to be closely associated with the British Business Graduates Society, a body originally started by students from the Middlesex Technical College. The college is of particular interest to me. The students have become successful managers. They did not have the benefit of one or two years of highly concentrated education and had to do most of their studying in the evenings and at other times. I believe that we should pay due tribute to such organisations.

The present situation lacks a central focal point for the consideration of the systems of other countries, as several noble Lords have pointed out. I had the pleasure and privilege of visiting Japan for a short period. I was most impressed by the way in which business, education establishments, the government and the community seem to have got their act together. In this country I do not think that we have done so. There is no recognition by the community—not even perhaps by the Government—of a lack of management education and training. That is a significant handicap to British business. I certainly support everything that has been said about the work of Professor Handy, Professor Constable and Mr. McCormick who have made some very wise observations.

Time defeats me and I am conscious of my responsibility to those who will speak later. However, I hope that the Minister will be heartened by what has been said. The noble Baroness will never be able to satisfy everyone on all points but she should know that there are Members of your Lordships' House with long experience of industry who have a deep commitment to this aspect of it and who want to ensure that she is successful in promoting in the community the idea that training for successful business management is well worthwhile.

My Lords, the noble Lord, Lord Peston, has made it possible for the House to debate this subject at a very timely moment. The Education Reform Bill will very soon come before your Lordships. We shall be discussing the whole spectrum of education and, I hope, the question of managers for the future.

Unlike many noble Lords I have no interest in or connection with a business school or university. Because of National Service I did not go to university and in 1948 went straight into the insurance world where I have spent the bulk of my working life. I recall very clearly the manager of the office where I started work at the age of 22 saying to me, "I think you are settling down well, but, my boy, may I give you a word of advice?"; I said, "Yes, sir". It is rather different nowadays with young people, but time marches on. He said, "I have been in this firm for 43 years and I am still learning".

The moral of that remark is that management is always learning. Of course 40 years ago computers and videos were virtually unknown and there was far more person-to-person contact. I believe that one of the problems that we face in business management, and indeed in management generally, today is the lack of personal contact.

I should like to say a few words about the Chartered Insurance Institute College of Insurance at Sevenoaks in Kent. I have no interest in the organisation but the principal happens to be a longstanding friend of mine in the insurance business. Management training through management courses is one of the main aims of this college. There was roughly a 57 per cent. pass rate for last year's entrants, which is very encouraging for the future. In his presidential address in 1987 Mr. Alan Cleary made the very apposite remark:

"There is in the UK insurance industry (unlike the American insurance industry) a noticeable lack of visible top management commitment to insurance education and training".

That observation is not, I believe, to be confined entirely to insurance. One of the problems is that managers today are frequently very much younger than managers were 30 years ago and they do not perhaps command quite the same respect from their juniors.

It is quite clear that the complicated Financial Services Act which is now on the statute book will have an enormous impact upon management, particularly in the field of commerce. It will revolutionise—in fact it has already done so—much of the world of insurance and the impact will fall particularly on management. There is therefore the added need for management to pull its act together and to ensure the success of our insurance industry (and indeed the City in general), particularly in view of the increasing competition not only from Japan and America and the larger countries but from some of the smaller countries as well.

I believe therefore that in management training communication is more important than almost anything else. Some years ago I spent a short time as a management consultant and had the privilege of helping to run a course at the Management Centre, Europe, in Brussels on the subject of effective public speaking and business-letter writing. Those noble Lords who know the Management Centre, will know that it is a very prestigious establishment. It does not command a fee. It is regarded as an honour to be asked to speak there. On the course were a number of persons not only from the country but from overseas. I believe that this point is germane: the standard of English which they spoke, even 15 or 20 years ago, was rather higher than the standard of our managers speaking French, German or Spanish. As was mentioned in your Lordships' House not long ago, a knowledge of foreign languages is all important. I am sure that the Minister will take that point on board.

I was at a school concert in Surrey the other evening. It is a school that both our daughters attended. The point was made by the headmistress about the vital importance of languages. It is a girls' school, and it is good to see that there are more and more women going into management, in particular in the catering industry, which, although not always regarded as being in the field of business, is nevertheless an industry which earns currency for this country. Through very much better management our catering industry has done enormously well compared with even 10 years ago. The University of Surrey is due much credit for that.

I should like to ask the Minister what significance the Government are putting on communication in the business and other schools under their jurisdiction. The challenge in the future of business management, and management in general, in a very competitive business world is to be able to impart the knowledge that one has gained in student days.

My Lords, I am very grateful to my noble friend Lord Peston for introducing this debate. I congratulate the noble Marquess, Lord Huntly, on contributing in the way that he did. I know that it is the tradition in this House to say, "Long may he continue to do so", but I say most sincerely that what he had to say was absolutely first class.

Sometimes I agree with my noble friend Lord Peston and sometimes I disagree. I am pleased to say today that I agree with most of what he has said. I have wished for a long time to put forward ideas about training teachers and people in universities. I have felt that they were out of touch with what is going on in industry and commerce. Very often I find that people in the teaching profession go from school to college, from college to university and from university back into teaching. Then after a number of years, because they have come from this background, they start acting like the children whom they are teaching. It would be good for them to have experience outside their profession.

I am a late developer. I am learning every day. One of the matters that I have learnt in your Lordships' House is that when one becomes the 10th batsman on the list many points have already been made that one would have made. However. I took the precaution of having a word with the Whips today. I said that I should like to speak later in the debate; I did not wish to be one of the front-runners. I felt that I should like to bring in a new dimension. I tried to anticipate the way in which this debate would go.

I should like to bring in another aspect on business training and to speak on the role of the colleges of further education. I believe that they play an important part in business training. It would be interesting to know how much the average British businessman knows about present day business education. Even though his business may be in a perilous condition, his workforce in a state of disarray and his organisation crying out for new ideas and fresh stimulation, the answer could very well be that he does not know very much, if anything at all.

If pressed, one or two businessmen may think back to the days when education finished on their last day at school, and training, if any, was carried out by sitting next to the only employee who could be bothered to show them the ropes, and never mind if bad practices were picked up along with good ones. Business studies qualifications could be obtained in those days only by a long, wearisome series of night classes at the local tech, where the teacher's blackboard notes were copied down by the students, learnt and then thrown into the waste-paper basket after the examination. It is little wonder that many businessmen still talk in despairing terms about business education at colleges of further education. What they do not realise is that times have changed. Colleges now house thriving, bustling, aggressively competitive business studies departments, very much in touch with the needs of modern businesses and as eager as any other business to find clients and to satisfy their requirement. Complacency is a thing of the past. Traditional methods of delivery are disappearing. Flexibility of approach is the order of the day. Business training can now be delivered in exactly the package that the businessman requires. Does he want one person or a dozen trained? Does he want the training to take place on or off the job? Does he want it spread over a number of weeks, or does he want it concentrated in a few days? No problem!

Let me give your Lordships' a couple of examples of the type of activities covered in my area in the Blackburn College. A large company operates a policy of appointing all its supervisors from its pool of operatives. It has found, however, that good operatives do not necessarily become good supervisors overnight. Traditional forms of training were out. The company did not want all its supervisors off the site at the same time each week. The solution was simple. The training was carried out by means of a series of distance learning packages which could be worked through the supervisors when time was available. Tutor back-up from the college was at hand when it was required.

At the other end of the spectrum a woman with a part-time job and a young family who wished to update her secretarial skills but who found difficulty in attending regular classes was able to take advantage of the business studies drop-in open learning scheme. That was a good scheme. She could return during the hours she chose, arrange for a tutor and at the end she was able to accept some qualifications and responsibilities.

An old saying is put your money where your mouth is. If a product is good enough it should sell and it can attract customers. The Manpower Services Commission is traditionally a hard customer to satisfy. It wants to know what value it is getting for its money. The fact that it is actively involved in many local collaborative training projects with colleges indicates the increasing significance of the role of such colleges in business education.

The fact that colleges are moving forward along those lines, attracting more people to take part in this type of business education, is an achievement in so many ways. Today young people are more anxious than ever before to achieve as much as possible and to get a great deal out of business. In many cases the only way in which they can do that—forgetting the universities and independent business studies—is by going to their local colleges of further education where they can achieve their objectives. I should like to impress on the noble Baroness that it is worth while and that the Government should consider giving a great deal more help than they are giving at the present time.

My Lords, the House will be grateful to my noble friend Lord Peston for introducing this debate on a matter which is now recognised as being of the highest importance but which was not recognised as such 10 or 15 years ago. Judging from the debate, it is a matter on which all noble Lords agree. There is unanimity in the House that we must concentrate intensely on this important problem. As the noble Lord, Lord Russell of Liverpool, and my noble friend Lord Irvine of Lairg have said, 1992 is getting closer and the skills that we shall then require in the internal market are not those traditionally associated with British management.

I am extremely disappointed to note that noble Lords who should have contributed to the debate have not seen fit to take part. I mean noble Lords who are captains of industry and who, I believe would have had a great deal to say about business education and education for 1992. The speakers' list consists of a number of noble Lords who are academic, a number who are failed tycoons, such as myself, and a number of tycoons-to-come, such as the noble Marquess, Lord Huntly. However, we have had no contributions in the debate from a real live tycoon. That is unfortunate because we are missing an experience that we should have had.

There are several stands in this discussion and I should like to draw attention to four of them. The first is: how do we bridge the divide between the practice of business and formal education? Secondly, in the words of the first boss of the noble Lord, Lord Auckland, how do we ensure that there is continuing education in employment? Thirdly, how do we get rid of the difference between training and education? That may appear to be a slightly semantic point but it expresses something which is most fundamental and I shall return to that in a moment. Fourthly, in the words of my noble friend Lord Peston, how do we try to educate industry, if that is what must be done, to want the products of the various organisations such as the business schools and the Open University?

My noble friend's Motion concentrates on business education and puts emphasis on management by referring to the role of business schools. However, my noble friends Lord Graham of Edmonton and Lord Taylor of Blackburn reminded the House that we must not forget the lower echelons, if I can describe them as such. In that respect I now turn to the difference between training and education. The Handy Report brought out the fact that there is a greater flow of management talent coming up from the junior ranks and artisans in other countries than there is in the United Kingdom. I am afraid that somewhere we may be locked into a post-imperial class problem, where our traditional education is turning out people designed for a certain role in life which is no longer relevant.

The fact that there has been an extremely disappointing response to the Open College, which was designed by the Manpower Services Commission to give training for adults, is extremely significant. According to one newspaper article the whole thing is near collapse because it is not working; it is not receiving sufficient candidates and it is in need of a relaunch. Even more disappointing is the fact that those who are not availing themselves of this important new initiative are the small and medium-sized firms which particularly need this type of continuing educational input. I regard that as saying something rather worrying about the education formation, if I can use that expression, of people as they go through their working career. It is those people who must be trained, retrained, reformed and brought up to the point at which we hope they will take on a more supervisory role, as my noble friend Lord Graham said.

Clearly there is a point to which the Government must pay considerable attention. If the Open College is failing, what kind of schemes are the right schemes? Is it a question of relying on local authorities? Is it a question of relying on Open University-style programmes? Is it a question of relying on the colleges of further education? Someone must answer that question quite quickly. The question which underlies that is: which government department is in charge of that programme? Is it the DES or the DTI? In that respect we get down to the point to which we shall finally return.

My noble friend Lord Peston concentrated on management and most noble Lords have followed him along those lines. When reading through the Handy Report and the Constable Report, it is unfortunate to note how far behind we are in management education. It makes rather depressing reading. In all countries studied by Professor Handy there is a consistent belief that the real basis for continuing learning in management is experience at work allied to continuing education. That must be the principle on which we all stand. However, the noble Marquess, Lord Huntly, and the noble Lord, Lord Ezra, were absolutely right in pointing to the necessity of having a practical application in the business school and other programmes which were applied to the managers in business.

The differences between the countries that were studied by Professor Handy seemed to lie in the interaction between the institutions providing such formation, education—use whatever words you like—and business itself. In Japan it is formalised. For almost every individual in a Japanese company there is a programme of what is known as self-enlightenment. As he goes through his career in one company—because the Japanese tend to stick to one company—he is put through a series of courses of an incidental nature, which may be evening classes, day release or sandwich courses and he updates his knowledge on a monthly and yearly basis. Therefore, he is kept fully informed about the progress of management techniques and the technology of the firm for which he is working.

In the United States it is rather different, because the market for managers is rather more diverse and people move from company to company quite easily. The tendency seems to be that the development of managers, as Professor Handy says, is opportunistic and individualist. In other words, people take their own responsibilities and say, "I am going to develop my career in this way and I am going to learn outside the job I am doing".

Professor Handy notes that in the United Kingdom the development is accidental; it depends in which company you happen to be working. Some companies are extremely good and others are extremely bad. To me that is the nub of the problem. Not only do the companies that are extremely bad not recognise the virtues of entrepreneurship—because I agree with my noble friend that you cannot educate people to be entrepreneurs. They do not recognise that there is a skill in management that can be taught. It is those companies to which the Government must direct their attention.

I believe that there are programmes available. The noble Baroness, Lady Carnegy, very impressively set out what the Open University has to offer. There are other programmes available. There is the Charter Group, to which I shall refer in a moment. There are possibilities. However, as my noble friend Lord Peston said, you first have to educate many people in industry that they actually need these products, and that is the fundamental problem that we have.

Management development in the United Kingdom clearly must be more systematic than it is at the moment. The Charter Group is a start of that and the DTI has become a member of that group. I confess that I share some of the doubts of the noble Lord. Lord Russell of Liverpool, about the charter. The Constable Report puts forward a programme that formation management should be similar to that of professionals; and indeed, we are very good at educating and forming our professions—for example, the accountancy profession has a very good record. I am slightly doubtful whether that is the right formula for industrial business management but it is what we have. It is an initiative and it must be developed. I am not going to knock the Charter Group but I join with the noble Lord, Lord Russell, in some of the doubts which he expressed.

In its recent White Paper the DTI put its finger on what I believe to be the real problem. That White Paper states:

"Experience suggests that market forces on their own will not bring about the necessary improvements in the quality of British management, or, at any rate, not quickly enough".

Such a sentence coming from the department headed by the noble Lord, Lord Young of Graffham, must be taken very seriously because he is a great protagonist for market forces. If he in his White Paper says that market forces will not produce the desired result, that is a proposition that we must take seriously.

I am quite clear about it. I do not believe that the response that the noble Lord, Lord Young, made to the professor in Edinburgh of my noble friend Lord Irvine of Lairg is in any way adequate. I believe that the Government must intervene much more actively in the process of training. They have to persuade people and not just encourage and facilitate. They must reward and penalise companies that do not get a move on, because I believe that is the only way to do it. If the Government sit back and say, "Our job is to do little things here, promote programmes here, join the Charter Group there", I am afraid that some of the predictions that noble Lords have made, including my noble friend Lord Irvine, about 1992 are correct. We will go into the internal market wholly unqualified to do business in a completely different environment. If that happens the whole question of management education becomes more or less a theory and no more than that, because we shall find that the people in Germany and France who are learning about our ways will start knocking us out of business rather faster than we can knock them out of business.

I therefore ask the noble Baroness to draw the attention of the House and her noble friend the Secretary of State to the prime necessity of government intervention and government intervention in a purposive manner in management training so that we can meet the challenge of the internal market and ensure that this country can hold its head up in the battle that is to come.

My Lords, we welcome the opportunity to debate this important topic and I add my thanks to those of others who have already thanked the noble Lord, Lord Peston, for introducing his Motion and providing us with this opportunity to learn from so many who have contributed their very wide knowledge and experience to this debate. I also welcome the fact that at least two contributions have come from the products of business schools and I believe that augurs well for the future of those schools. It also gives me great pleasure to add my congratulations to my noble friend Lord Huntly on his excellent maiden speech. We shall look forward to hearing from him on many occasions in the future.

The subject of business and management education is a very wide one, as has been demonstrated. There may not be time to cover all the aspects to which I should like to draw attention, but I shall try. It has emerged, not only from this debate but from the great debate outside your Lordships' House, that there is wide agreement that we need more and better education for business and management in order to keep the United Kingdom competitive in world markets, particularly in the light of 1992 and the completion of the internal market.

Industry is quite properly taking the lead in trying to develop a coherent framework for management education which will meet the country's requirements for the future. The Government—like the noble Lord, Lord Ezra, and others—recognise the message of the Handy and Constable-McCormick reports; namely, the specific needs for more and better educated and trained managers. The Government are always concerned to know what the customer wants, and the international comparisons that these reports provide are indeed most valuable.

The Constable-McCormick Report looked at the making of British managers. Both the reports point out the need for a cultural change to make management development and training an established part of the life of the country. That cultural change has been referred to by many of your Lordships. The acquisition of management competences needs to seem desirable and prestigious in the eyes of aspiring managers. This may come in part from the establishment of some more specific recognition that is currently available.

However, it is hard for changes in attitude to occur overnight, although there are heartening signs that our society is becoming more realistic and responsive to the economic facts of life. So while we hear from the two reports that change is necessary, we know that conviction is needed before the change will take place. That conviction must stem from the customers and particularly the employers.

Therefore, it is entirely right that the CBI should be leading the response to the two reports. That lead was particularly welcomed by the noble Lord, Lord Ezra. We look to the new Council for Management Education and Development, which brings together representatives of industry, government and education to tell us precisely what employers want from the management education system. Indeed, we expect that to include the need for a proper balance between the practical and the academic, as has been mentioned.

Can a structure of qualifications be devised which will be as relevant to managers in heavy manufacturing industry as to those in local government and the service industries? Some of the educational issues which the council are grappling with are associated with the recommendation in the Constable-McCormick report that there should be a new diploma in business studies. Professor Handy called it an MBA Part 1.

This was conceived as an exam-based qualification for the aspiring manager up to 25 years of age. I think that the recommendation may encourage some carefully conducted experiments. The MSC and the DES have put together a programme of pilot projects which will be designed to try a number of different approaches. I trust that this will go some way to reassuring the noble Lord, Lord Russell of Liverpool.

Once we have decided on the curriculum and the qualifications, we must then consider how to put in place a number of different delivery mechanisms—including open and distance learning—which will allow young managers at the most effective stages of their careers to take on board the training that will enable them to progress even more quickly up the ladder of job advancement. I believe that this too will coincide with the aims stated by the noble Lord, Lord Williams of Elvel.

It is not for me to prescribe solutions to these problems here and now. The Council for Management Education and Development must be supported in its work, not pre-empted. But I am bound to say that it seems very probable that employers are going to favour the route which interrupts the company's business the least. This means that we can expect to see emerging an increasing number of training schemes tailored for particular firms, pursued part-time and in the evenings. Such schemes may lack educational breadth and depth. When the new structures are in place there may be less need for this sort of course. But that will take time and we cannot postpone all remedial action.

My noble friend Lady Carnegy of Lour and the noble Lord, Lord Graham of Edmonton, reminded us of the valuable role of open and distance learning.

The part-time distance learning approach is increasingly popular with individual managers, for whom it offers flexibility and the chance to make use of the newly-acquired skills without delay. As the CBI has made clear, it is equally attractive to employers. The result has been a sharp rise in the number of managers studying in this way. As my noble friend said, the Open University's open business school, to take but one example, had over 6,000 registrations in 1987 and now, with government help, is developing an MBA programme. But Constable McCormick are clearly right to stress that even more extensive use of distance learning methods is essential if a major expansion of management education is to be achieved. We endorse that. Indeed, the Open College, which has been referred to, is intended as a further step in this direction.

At a meeting on the two reports arranged by the Foundation for Management Education last May, I understand one industrialist voiced the fear that if more were done to encourage suitable young people to become managers then this would simply aggravate the shortage of engineering and technology graduates. Clearly we need to plan the balance of our higher education provision carefully; but for the moment, the Government plan for 35 per cent. more undergraduates entering science courses and 25 per cent. more entering engineering by 1990, and this is being achieved at the same time as a planned increase in business and management graduates.

The past mismatches arose for a number of reasons. Not least of these has been the narrow curriculum in many schools. The Government's plans for a national curriculum, with its inclusion of English, maths and science as core subjects, and craft design and technology, and a compulsory modern foreign language as foundation subjects, should help to redress that balance. I trust that the noble Lord, Lord Graham of Edmonton, will welcome wholeheartedly those proposals when they come before your Lordships' House.

I accept, as I expect that most of your Lordships do, that there should be a clear ladder of progression for managers to climb. The stages of progression need labels. The labels, and what they mean in terms of competences, need to be understood properly and universally. Employers must find them reliable guides to performance. There must be opportunities to get on to this ladder of progression from all levels of the workforce. This ladder must not be solely for an elite. All employees deserve the chance to reach their full potential. Some would argue that there are extremely demanding management posts at the lower levels where there is not much to distinguish the junior manager from his, or her, workmates—from whom he is only one step removed—beyond added responsibility.

This ladder of progression and its accompanying qualifications do not imply concentration on knowledge alone. We must not lose sight of the skills of leadership and the management of people to get that balance.

A revised ladder of qualifications, more emphasis on training and open access to it, may be of most immediate relevance to the young and successful. There are, and will be for some time to come, many serving managers who for age or other reasons will not become directly engaged in a new structure of qualifications and training. But these people have valuable experience. They have influence within their firms. Their help and advice, perhaps as mentors, could contribute greatly to the success of improved management education and development.

The expansion of management education which is being envisaged will require additional teachers. I am told that schemes to enable some of these experienced managers to help meet this requirement are being worked on. Indeed, business studies feature in the DES teacher recruitment campaign as a shortage subject and applications are up 23 per cent. this year.

Perhaps I may say to the noble Lord, Lord Peston, that we welcome the enterprise initiative to which he referred that has been made by Queen Mary College to set up a major new business school in Docklands. There are a number of colleges already providing business courses. The noble Lord, Lord Irvine of Lairg, referred to some and the noble Lord, Lord Graham of Edmonton, referred particularly to the Co-operative college. I fully recognise those contributions.

There are other organisations such as the Institute of Directors, the British Institute of Managers, the Institution of Independent Managers, and the Chartered Institute of Insurance to which my noble friend Lord Auckland referred. They all make valuable contributions and increasingly work together.

There is also the pickup programme, to which I shall refer in more detail. There are firms such as W. H. Smith, Shell, and Rank Xerox, to name but a few, which have schemes in being. Therefore, we already have some experience to build on. In this context, I also endorse the value of "Business in the Community", which has been recognised by the Government in their inner city policies.

The noble Lord, Lord Peston, referred to enterprise in higher education. There is a clear need for more business and management enterprise awareness for all those who are benefiting from higher education. The Government are committed to encouraging enterprise throughout society. Today's rapidly changing world of work demands not just highly qualified people but those who are innovative, enterprising and competent in business skills. That is why the Department of Employment recently launched, with the Department of Education and Science, the enterprise in higher education initiative.

The initiative aims to develop more enterprising graduates by forging closer links between higher education and business and with, in particular, small firms. All higher education institutions have been invited to participate. The MSC funding for each project accepted will be up to £1 million over five years. We are also expecting industry and commerce to provide substantial financial support if this initiative is to succeed. Succeed it must if our businesses, however small, are to achieve that competitive edge that they need in order to grow.

It has been said that entrepreneurs are born and not made. I recognise that we need to support them by ensuring that our educational institutions are ready to provide that necessary support. Many noble Lords referred to the need for encouraging the development of business and management short course provision. This has also been a priority of the Department of Education and Science and its pickup programme. Under this programme, support has been provided to promote various continuing professional development schemes including a major project concerned with the continuing education and training needs of engineers and technicians. The scheme was recently launched and it is being run jointly with the Engineering Council.

Both the National Advisory Body for Public Sector Higher Education and the University Grants Committee have made moneys available under their pickup selective exercises to support the development of business and management education. The pickup programme covers many individual projects, including a scheme with which I was recently involved. It involves the Royal College of Veterinary Surgeons and emphasises the need to provide management and business skills for those vets who essentially run small businesses as well as updating their professional and technical skills. The pickup programme is also involved with collaboration with universities in export language centres. This provision fills the gap which has been referred to by many of your Lordships.

The noble Lord, Lord Peston, mentioned the regions. I should like to draw attention to the regional management centres which have been set up in many parts of the country based upon polytechnics. The northern RMC involves Newcastle, Teeside and Sunderland polytechnics and co-operates with Durham University Business School in the provision that it makes. The noble Lord referred to Scotland in particular; it was also referred to by the noble Lord, Lord Taylor of Gryfe. A substantial contribution is made to business education in Great Britain. I understand that in 1984–85 there were almost 20,000 students on business and management courses in higher education institutions in Scotland. The subject has not been missed out there.

As the Minister responsible for further education, I particularly welcome the references made by the noble Lord, Lord Taylor of Blackburn, in stressing the contribution of further education colleges. I cannot claim that all colleges come up to the ideal described in the HMI NAFE In Practice report on business studies. However, it provides an explanation of a variety of practice and it has been followed up by HMI at both local and national levels.

Like the noble Lords, Lord Williams of Elvel, Lord Irvine of Lairg and Lord Russell of Liverpool, I acknowledge the importance of suitable preparation for the single European market and its completion by 1992. I agree that an awareness of EC law and practice in particular and knowledge of languages for communication purposes will be an increasingly important aspect in the social, economic and political context of which managers must be aware. I have no doubt that the development work for qualifications will bear this in mind and that institutions will respond to the demand for short courses. I shall certainly draw the attention of my noble friend Lord Young of Graffham to the remarks that have been made in the course of this debate.

Many of us, like the noble Lord, Lord Taylor of Blackburn, may feel that we are late developers. I certainly feel that I can carry on learning with considerable benefit. I believe that we have a consensus this evening that business and management education has rarely been as important as it is today. There may be a long way to go but the Government are supporting industry and commerce as they articulate their needs in the light of the Handy and Constable-McCormick reports. I am confident that the considerable challenges posed by the rapid development of the business world can be met by industry and commerce, education and government working together in partnership.

My Lords, before the noble Baroness sits down, perhaps she will give way and answer this question. What will be the precise educational or training content of the awareness campaign to be launched by the Government on Friday with a view to the single internal market which comes into being in 1992? I wonder whether the noble Baroness can allow the House the benefit of that information.

My Lords, I believe that we are running out of time. If the noble Lord is not satisfied with the numerous ways I have described in which we are going to meet this challenge, perhaps I may be permitted to write to him.

My Lords, I shall be content with a short answer. I should like to know whether there is any specific educational content to this awareness campaign, which is only a couple of days away from its launch.

My Lords, I shall be as brief as possible. The answer is, yes.

My Lords, I thank noble Lords for taking part in this debate and the Minister for her response. I believe it is a besetting sin of your Lordships' House that we tend to be a trifle self-congratulatory. This has been a very good debate and I for one have learnt a great deal from it. Not least of the contributions has been that of the noble Marquess, Lord Huntly. He referred to his father as having one or two outrageous views and it may be that the noble Marquess has one or two such views himself. In that case I look forward very much to hearing them. If it will encourage him, he ought to know that one or two others of us have opinions which are occasionally a trifle outré. We can be persuaded to say a word or two to your Lordships on those matters.

This is an enormously important subject. I hope that we can return to it on other occasions, but for the moment I beg leave to withdraw the Motion.

Motion for Papers, by leave, withdrawn.

moved an amendment:

After Clause 1,

My Lords, I regret that I cannot commend the new clause to the House. As my noble friend has explained, it would confer on my right honourable friend the Home Secretary a power to vary by order the figure in Section 18(1) of the Betting, Gaming and Lotteries Act 1963. In Committee, on 7th March, I doubted whether it would be easier and better to vary this figure by order than by primary legislation. But I said that we should be prepared to consider a power the exercise of which was explicitly contingent upon a prior agreement between the interested parties.

The new clause does not provide for such an agreement. Instead, it asks the Home Secretary only to engage in consultations. This may be because my noble friend does not accept the condition which we had to set in Committee, or because he doubts that the consultation would achieve agreement. But, whichever may be the case, I have to say that the clause is defective in policy. In the absence of provision for prior agreement, it is extremely difficult to envisage on what other criterion my right honourable friend the Home Secretary could decide whether or not to make an order, and furthermore to justify that decision to Parliament.

Since the new clause does not meet the condition we set earlier, I ask my noble friend to withdraw it.

My Lords, I am most grateful to my noble friend for the trouble that he has taken to explain the Government's position yet again. Obviously, I am unhappy that he cannot accept this amendment. We shall have to agree to disagree. However, as he undoubtedly has the whip hand, I feel that discretion will be the better part of any contemplated valour on my part. As I wish to see the main thrust of the Bill go forward to another place, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

rose to move, That the draft order laid before the House on 10th February be approved.

My Lords, I thank the Minister for his tour through the main expenditure adjustments covered by the order and for underlining its salient features, which we support. I welcome his reference to the contribution from the International Fund of Ireland and for the additional support to meet the costs of repairing the flood damage caused last October.

I am also glad that the Minister has drawn attention to the helpful commentary on government expenditure in Northern Ireland which has recently been published. That is the first time such a commentary in respect of government expenditure in Northern Ireland has been published. Nevertheless, it is still difficult for a layman, or at least this layman, to form a coherent view of the totality of expenditure in Northern Ireland and the extent to which it achieves the Government's main policy objectives. I shall give an example of what I have in mind. The Department of Economic Development attaches great importance to its pathfinder initiative. The people of Northern Ireland were bidden by that initiative to tackle the six roots of their economic problems which it had identified.

Your Lordships will know that one of those problems was said to be the high dependency of its industry on public funds. We are told that the scale of government subsidy to the manufacturing section in 1986–87 was equivalent to £39 per week per manufacturing employee. It would therefore appear that one aim of the policy is to reduce the scale of that dependency. It would be helpful if the Minister could tell the House to what extent that aim has been achieved in the year 1987–88 and what is forecast for that dependency in the year 1988–89. From studying the appropriation order I have been unable to form a view of whether that dependency has been lessened.

When he replies the Minister will perhaps tell us whether the policy of reduced dependency is linked to a broader, and possibly more sinister, policy of reduction on planned spending on investment on economic affairs in Northern Ireland.

I wish to deal at some length with the health Vote and the important Health Department because the state of the NHS in Northern Ireland is the subject of serious concern, as it is on the mainland. It is a major worry. Growth revenue spending by the health boards will increase by 5·2 per cent. during 1988–89, which is below the yearly increase of 6·3 per cent. that has been agreed for the rest of the United Kingdom. If one deducts, as one must, 4·5 per cent. for inflation, the yearly increase is a meagre 0·7 per cent. That is way below the 2 per cent. a year increase which is required to meet the pressures on the NHS, according to Ministers' evidence to the Social Services Committee of the other place.

The capital programme has been reduced, and the department has acknowledged that the number of capital schemes due to start in 1988–89 will have to be deferred because of that reduced capital allocation. I should be grateful if the Minister would give particulars of the capital schemes which will be deferred during 1988–89. I anticipate that he may remind the House that the percentage of GDP spent on the NHS in Northern Ireland is double that spent in the UK. That is correct, but Northern Ireland Ministers do not claim that NHS spending in Northern Ireland is extravagant; the public do not claim that it is extragavant. On the contrary, the Health Minister for Northern Ireland, Mr. Richard Needham, has rightly acknowledged that the present level of spending in Northern Ireland on health services is "necessary and important".

That is consistent with the requirement of the pressures to be found in the poorest regions in the United Kingdom. High unemployment levels of 21 per cent. or 22 per cent.—I gladly acknowledge that they have been coming down over the past nine months—the high dependency on social security, poor housing, let alone the tensions consequent upon terrorism for the past 20 years, together generate greater demands on the health service. They also make the discharge from hospital and the provision of care in the community that much less acceptable.

The concern which we on these Benches express will come as no surprise to the Health Ministers for Northern Ireland. Indeed, the chairmen of the four health boards made their concerns clear to the Secretary of State for Northern Ireland when he met them a week ago today. Mr. Needham, the Minister, knows that he has a problem. To his credit, in his press statement of 22nd January he said:

"obviously we would like more money. I am fully aware that next year will be difficult for the Board. For my part I will do what I can to help Boards meet the pressures which inevitably arise in-year".

As a matter of interest, in that connection it has not escaped our notice that the Health Department has made an additional £150,000 available to the well-known charity, the Northern Ireland Voluntary Trust. Significantly that has been earmarked to meet the cost of setting up a number of projects to help local communities support vulnerable people at home. One does not require a great deal of foresight to anticipate that the demands of the vulnerable people in the communities in Northern Ireland will grow. In a small way, the department is anticipating that demand by the additional allocation of £150,000 to the Northern Ireland Voluntary Trust. But that is a trifling sum compared with the £7 million which the NHS in Northern Ireland has lost because the yearly percentage increase has been held at 5·5 per cent. instead of 6·3 per cent.

The Minister mentioned the themes which the department is encouraging the boards to adopt. Can he tell the House whether the department proposes to give some guidance to the boards as to whether they should be affording protection to some of the services on the department's long list of priorities and targets, or are they to be left to get on with it as best they may?

I think we have to ask why the health service in Northern Ireland is being denied the full 6·3 per cent. yearly increase. This is a reasonable question which we from these Benches must ask. Again, Mr. Richard Needham has given us the Government's explanation. It is this:

"The health service in Northern Ireland has been denied the additional 1·1 per cent., because more money has to be spent on law and order in Northern Ireland and everybody in Northern Ireland has to accept some responsibility for that".

Those were the Minister's words and this is the explanation which is on offer. It is in my submission a most peculiar justification and one which is simply not convincing.

To keep the yearly percentage increase on health expenditure at the lower level of 5·2 per cent. in order to spend millions more on law and order is not a convincing argument for adding to the disadvantage of the sick, or adding to the totality of the disadvantage, which is precisely what this does. Moreover, I think it questionable whether everybody is being asked to accept the same responsibility for the increased law and order bill. It seems to me that it is a burden which the sick in particular are being asked to shoulder, if there be anything to the Government's explanation. As I understand the appropriations order, the increase in all the other 21 Votes has not been held back 1.1 per cent. right across the board. I suggest that the people of Northern Ireland should not be fobbed off with a law and order explanation.

So what is the explanation? I have an uneasey feeling that the important health Vote—and the Minister acknowledged that it was an important Vote and an important department—has suffered this penalty because it is felt by the powers that be in the Treasury that the Province could do much more to help itself, as the Government are already spending 23 per cent. more per person on the health service in Northern Ireland than in England and Wales. I have a feeling that that is what the department has been told by the Treasury. Therefore, if that is right, the fault would appear to be that of the Treasury. If the fault be that of the Treasury, perhaps I may ask the Minister whether the Department of Health for Northern Ireland has commissioned a detailed study of morbidity in Northern Ireland and its relationship to resource allocation. If that has not been done, it ought to be done.

The NHS in Northern Ireland employs 63,000 staff. Perhaps I may ask the Minister whether it is being suggested that some of the staff are surplus to the real requirements of an efficient health service in the Province. I ask this question because it would appear to some people in high places that Northern Ireland should now be exporting abroad some of its skilled staff in the NHS. This is another remarkable development. The Department of Health, jointly with the Industrial Development Board, commissioned a company called United Medical Enterprises to consider whether areas of expertise within the health care sector could be marketed profitably outside Northern Ireland. The company confirmed that this was an area which could be developed or exploited. These glad tidings were brought to the people of Northern Ireland just before Christmas.

Moreover it was thought, and it was said in the press handout, that this opportunity of serving in foreign lands would provide the staff with the opportunity to broaden their horizons. It might be so interpreted by some people but it can also be seen as a piece of effrontery to the staff. Perhaps the Minister can tell the House when the Secretary of State hopes to come to a decision on the remarkable recommendations contained in this document. Can he also tell the House on whose initiative this remarkable study was commissioned?

We on these Benches do not want to see highly trained, highly skilled medical and nursing staff being encouraged to sell their services in the foreign market unless the department is fully satisfied that the standards of health in Northern Ireland are such that they will not suffer if it exports its skilled personnel. Otherwise, the decision would be foolish in the extreme and would add to the already wide range of deprivation and disadvantage which has been a burden of the Province for generations and continues to be a burden.

Before moving on to my next subject, and I shall be brief, I would add that I warmly welcome the publication last week of the long overdue proposal for a draft housing order to introduce homeless legislation into Northern Ireland. Before I sit down I want to ask a few questions about the University Education Board. I trust that there will be no point of great difference between us and the Government on this topic. I think it is opportune that I should be asking this question, because last week the main committee of the University Grants Committee was visiting Northern Ireland for the first time in 15 years.

Vote 2 of the Education Estimates provides an extra £3·2 million which will be used in part to support the two Northern Ireland universities in accordance with the recommendations of the UGC. It is this reference to the recommendations of the UGC which caught my eye. We are interested to learn more about the role of the UGC in Northern Ireland. I would therefore be grateful if the Minister when he comes to speak could explain to the House the relationship both in theory and in practice between the department and the UGC. Are the powers of the DES in relation to the UGC exercised in Northern Ireland by the Secretary of State for Northern Ireland on his own or jointly by the two Secretaries of State?

Is the level of Treasury funding for the Northern Ireland univeristies determined by the UGC? What role does the Secretary of State for Northern Ireland play in the allocation of Treasury funds to the Northern Ireland universities? I understand that a Northern Ireland sub-committee of the UGC has recently been established. Am I right that its members will be appointed by the UGC, and is the Secretary of State for Northern Ireland involved in making these appointments?

These questions are important. The role of the UGC is important because the universities in Northern Ireland, as indeed throughout the United Kingdom, are facing a crisis as a result of the Government's determination that they produce value for money. Therefore we want to know who at the end of the day is responsible for the allocations to universities in Northern Ireland. Is it the UGC or is it the Secretary of State for Northern Ireland?

I have taken far too much of your Lordships' time. I have concentrated on the one main Vote and by doing so I am sure that I have overlooked significant adjustments which are contained in the draft order. As only very few Members in another place who have the honour of representing Northern Ireland constituencies took part in the debate in another place on this important order—and whose contribution based on their detailed knowledge of constituency conditions and pressures would have been so valuable in illustrating the nature of the problems in Northern Ireland—there is a risk that one may have failed to spot a hidden problem. But fortunately I am to be followed by at least five other speakers who I am sure will do justice to the order.

My Lords, I am sure that my noble friend and I are both grateful to the Minister for his care in explaining tonight's order. I shall start by glancing briefly backwards to the appropriation order debate which took place in your Lordships' House on 16th July 1987.

I have to thank the Secretary of State for so promptly organising a new community relations unit reporting directly to him. I also underline and repeat what I said at cols. 1223 to 1225 of the Official Report in July concerning the ACE scheme and the most effective and appropriate methods of funding voluntary bodies and community effort.

This is a matter which affects community relations and there is scope for improvement, among other reasons because many people suspect that the ACE scheme and some other forms of government aid are used as a means of social control. I hope that those suspicions are unfounded, but Her Majesty's Government could do more to show that this is the case.

British-Irish relations have been, I regret, in sad disarray since the New Year. In Northern Ireland, from where I returned last week, there was more than usual tension in the air. Dramatic political progress may therefore not be possible but I ask the Government please to keep on thinking about returning greater political responsibility to the people. Would they, for instance, work out the implications of having a proportion of elected members on the statutory boards—for example, the Housing Executive board, the education and library boards or the health and social service boards? Would not a mix of perhaps one third appointed, one third nominated by district councils and one third directly elected be an improvement on the present position? If these new elections coincided with European elections, general elections or local government elections this would avoid unnecessary proliferation of voting.

My next question concerns the Payments for Debt (Emergency Provisions) Act 1971. This is an old Stormont Act designed for the emergency situation arising from the rent and rates strike of 1971. The Minister will, I am sure, confirm that it was intended to be a temporary measure. The evidence for this is in the Title and also in Section 18, which enables the emergency period to be ended by Order in Council. There is no need therefore for legislation. I have to ask the Minister why, if the Act was intended to be temporary, it is still in force. Also why are the procedures for recovering debts due to statutory bodies totally different in Northern Ireland from those which apply in the rest of Great Britain?

I come now to housing. I should perhaps tell your Lordships that it was questions of housing aid and housing associations that took me to Northern Ireland as long ago as 1968 during the civil rights era. Since then survey after survey has shown that Northern Ireland has housing problems and arrears of work as bad and probably worse than those in the worst affected parts of Britain.

Visiting elected members and officials from the European Community agreed that Belfast and Naples should have equal priority for the regional and social funds. Much progress has been made since then. The Housing Executive and housing associations have done a very good job and no one would deny that. It is really encouraging to see rebuilt areas as diverse as the Markets or Sandy Row or to drive up the Crumlin, Antrim or Old Park Roads. Much however remains to be done. The doing of it is essential to public health, to employment and the local economy, to community relations and above all to public morale, especially in the most deprived urban and rural areas. Those are the hardline areas where traditional sectarian passions are strongest and where the fewest leading politicians, civil servants and professional people actually live. Housing has a contribution to make to peace.

It was therefore with the deepest disappointment that I learnt of a cut of £19 million in this year's capital provision for housing. This was followed by a further cut of £5 million only last week, apparently to bolster up the beleaguered health service.

I beseech the Minister to realise that these are false economies particularly in view of yesterday's Budget Statement about which I say no more. Will the Minister urge his right honourable and honourable friends to make compensating increases in the provisions for 1988 to 1989?

Belfast has earned some entries in the Guinness Book of Records. It has, for example, the largest girls' comprehensive school in Western Europe and perhaps anywhere. It also has one of the largest system-built groups of dwellings in the Divis flats. This can only be called a housing and health disaster area. Whatever could go wrong has gone wrong. The roofs, the walls, the windows, the ventilation, the lifts, the rubbish chutes, the access decks and the sewers have all gone wrong. There is penetrating damp, condensation and periodic flooding. The stairways remind me of a cross between the Middle East and Dante's Inferno. I have not so far risked the lifts.

In 1987 the University of Ulster studied Divis and Twinbrook, which are two areas of Belfast comparable for poverty and unemployment. The study however showed adult mental health to be four times worse in Divis, while long-term child illness was 10 times worse.

I visited the blocks that still stand both by day and by night. I hope that the Minister who is responsible for housing will do the same and take the chairman of the Housing Executive with him. They have only to ring the chairman of the residents' association and I am sure they will be most hospitably welcomed.

They will find that the inhabitants of Divis are normal human beings who endure bad conditions with cheerfulness, patience and resourcefulness. Their pre-school play project won a recent Ewart-Biggs award. They put on nativity and Easter plays. Their drop-in teenage centre fields football sides in local youth leagues. The residents' ACE scheme employs 70 people in a situation of about 85 per cent. unemployment.

In efforts to cope with such problems as a probable 50 per cent. glue-sniffing rate among some young people there is a welfare advice centre, country outings and a variety of training workshops. Young residents have graduated in word processing, hairdressing, driving and other marketable skills. Adult education takes place on site and some people cross the road to the Conway Mill education centre, which was highly commended by inspectors of the Department of Education in Northern Ireland.

These are all signs of a local community wanting to give hope, purpose and meaning to peoples' lives and seeking to prevent despair, alienation and vandalism in near impossible circumstances. Experience shows that vandalism almost disappears when people move into new houses with their own private space; for example, in the area immediately adjoining Divis in and around Albert Street.

After long campaigns and with the help of the Town and Country Planning Association in London, and since the demolition of five blocks in the original complex, the decision has been taken to demolish all the flats and maisonettes. That is an excellent decision. However, the Housing Executive believes that rehousing and demolition will take seven to 10 years. That is too long. I ask the Government whether they will provide the resources for a more rapid programme. A shorter programme would save significant health and welfare costs and avoid additional expensive repairs. I do not expect a full answer tonight. The question is far too big for an off-the-cuff response.

Finally, I ask the Government to discuss with the Housing Executive the use of every available and potential housing site in the Lower Falls area. I have noted vacant areas both withnn the Divis complex and in Grosvenor Road. I shall write to the chairman of the Housing Executive about them. I repeat that humane housing has a big contribution to make to that peace which we all so much desire.

My Lords, I am most grateful to my noble friend for his introductory remarks and his explanation of the appropriation order. I hope that it will not be taken as slightly frivolous, against the events in Northern Ireland, if I address my remarks this evening to the subject of salmon and salmon fishing. It is an important subject because it is an important element of the tourist trade and it has a spin-off importance in many other fields.

Before going further, I declare an interest, in that I own a small amount of fishing on what could be described as a modest fishing river. My noble friend will remember that in December he kindly came to my home, where we had a meeting with various fishery authorities to discuss the reasons for the acute shortage of salmon in Northern Ireland rivers throughout the 1987 season. The main subject of discussion at that meeting was offshore netting, which was held to be to blame for the bad season and was thought to be done on a massive scale mostly outside the 12-mile fishery limit. That limit is the area within which the United Kingdom, Ireland and other countries operate fishery protection.

As I understand it, based on the information given by experts, the problem is that fish coming from the north of Ireland approach down the west coast of Scotland. Because of the bulge created by the island of Islay, they are pushed far to the west and to the north-west coast of the Republic of Ireland and County Donegal, where they do an "S" bend, come east again and then enter the rivers of Northern Ireland. They are thus fair game for any form of legal or illegal fishing which may take place off the coast of the Republic of Ireland.

A bigger problem is that, while no one knows exactly what the fish do, they are thought to go into the area running roughly in a line between the southern tip of the Hebrides and Malin Head in the Republic of Ireland. That is a large sea area, all of it well outside the 12-mile limit and well out of sight of land. One hears terrible rumours—they may be nothing more than that—that last year there was 55 miles of continuous monofilament net stretching from the Bloody Foreland in County Donegal down to the north-west coast of the Isle of Man. I do not know whether that is true. However, there is usually some element of truth in such stories. If that is so, it is obviously a serious matter.

Added to such stories is the fact that such fish as we are catching are netmarked and that they are very small and would therefore have been the only fish able to get through the nets. Many of the fish which are caught offshore are never landed in Ireland at all. It is thought that they are sold to the trawlers of foreign powers outside the 12-mile limit. They are never landed in Ireland, the United Kingdom or the EC.

At our meeting my noble friend agreed that he would endeavour to set up a meeting of the Royal Navy, the Royal Air Force and the Department of Agriculture and Fisheries in Edinburgh to see whether some plan of campaign could not be worked out. We are now into another fishing season and so far nothing has happened. I therefore ask whether he has been able to make any progress in that field and whether there is any prospect of co-operation between the services and the various fishing industries. I should also like to ask, if that is not the case, whether there is any hope that the EC will take a hand in the matter. As I understand it, jurisdiction is claimed within 200 miles of the coasts of EC countries.

I also ask my noble friend to take the matter up with the Government of the Republic of Ireland. That would seem to be an appropriate subject for discussion within the context of the Anglo-Irish Conference. I also ask whether he has read a publication from the Government of the Republic of Ireland entitled Framework for the Development of Ireland's Salmon. It is a document which makes very interesting reading. It indicates that the Republic of Ireland is keen to provide greater protection, to put quotas on the numbers of fish landed and to introduce tagging, among many other things. For the Republic, that would be enormously expensive and a mammoth task. I suspect that it would also not be very politically rewarding, because fishing is probably the main industry in many communities in the West of Ireland. I hope that my noble friend will encourage the Republic in every way possible to do something about the offshore netting problem.

The other major subject at our meeting was the question of farm slurry which is being let into the rivers and which damages fish. At various times there have been grants to farmers to build slurry tanks. I think that at the moment those are withdrawn. They have been on and off on at least two occasions in the last year. As I understand it, something on the order of £1 million was set aside for that particular grant and it was oversubscribed about 10 times. I ask my noble friend: will those grants be renewed and, if not, is there any chance that help could be obtained from the EC? The matter is worth pressing, since the fact that so many farmers applied for those grants means that they are now taking an interest and are willing to play a part. That should be encouraged in every way possible.

Poaching is a serious matter in Ireland. I shall not go into a lot of poaching stories. I have been making inquiries about the penalties, and I am told that by and large they are satisfactory. The problem is that they are not always enforced. While I do not wish to be rude in any way about the judiciary or to criticise it, perhaps it could be conveyed to its members that, when dealing with poaching offences, they are dealing with what is in fact a national asset. I hope that that will be in the forefront of their minds.

Could there not be a tagging system? This is no more than a system whereby a bona fide fisherman or anybody obtaining a fishing licence acquires with it a number of tags. The tags have to be put immediately into any fish caught. The system contributes to establishing the history of where fish came from. Any fish that is untagged may be assumed to be an illegally taken fish. Could there not also be a register in which fish merchants, hotels, restaurants—indeed, anybody who sells salmon in any form—must record where the fish came from? In this way they too could help to reduce the poaching incentives. Incidentally, both those measures are recommended in the Republic of Ireland document to which I have referred.

I turn now to the Fishery Conservation Board, which looks after a large part of the Northern Ireland fisheries and does a very good job. I hope that it will be reasonably well funded. It has only one fishery protection boat, and there is a rumour that this is about to be withdrawn because of shortage of funds. The board has been told that it must protect the offshore fishing by means of someone sitting on a sandhill with a pair of binoculars. However, that may be an exaggeration. I hope that the Minister can confirm that the boat will not be withdrawn.

Another point arises in regard to the Fishery Conservation Board. Unlike most fishing authorities, it does not have in its whole system—and it is the largest system in Northern Ireland—a single fish counter. If it is to monitor the progess of fish, whether in an upward direction or in decline, it is vital that it should have the means to monitor properly and so take the necessary action in time.

I have one final point on fishing. Can the Minister say what is being done about restocking the rivers? I know that an experimental programme is taking place. I know too that efforts are being made to identify the eggs in various rivers with a view of transferring for fertilisation the female eggs of fish that have been taken from other rivers. Can the Minister say how this is progressing? Is there any guarantee, bearing in mind that salmon are supposed always to return of the river of their birth, that fish produced in this way will return to the river of their birth?

I deal finally with the drainage of rivers. I have always been an advocate of this, particularly in regard to many of the small rivers—what in Northern Ireland are called minor watercourses. A great deal of very good work has been done and much farmland has been improved by this means. Many farmers, I am sure, would say that they are enormously grateful. However, the wheel seems to have turned almost full circle and a new problem has arisen. The rivers that have been drained now rise so rapidly and come down so fast that not only are they tearing away banks and trees and bringing down masses of silt and gravel, thus creating other obstructions, but in several cases they are flooding the lower waters. In some rivers the upper waters have been beautifully drained and the farmers are very happy, but the flood waters have been transferred to the lower waters. From my own experience, I can name the river from which I take my name, the Moyola, as one of them. I know that the same thing is happening in the Blackwater, and I hear quite a lot of grousing about some other rivers. I do not know whether there is an answer—I doubt it—but some consideration should be given to this in planning future drainage.

Years ago when drainage schemes were first started, and certainly throughout all my political life, when a waterway or minor watercourse was going to be drained the farmers who owned the banks and the land beside them were asked to sign a consent to allow the Ministry to take its machinery on to the land and to do whatever was necessary. In return for their signing the consent, it was agreed that henceforth, after the completion of the drainage, the Ministry would accept responsibility for the maintenance of the banks and for keeping the river clean. As I understand it, this undertaking has been withdrawn. Has this been done with the consent of the Minster or of the department? If so, I think that it is a reprehensible step; in effect, the department is breaking its undertaking.

That is probably enough on fish and drainage. These things all cost money, and I shall certainly support the order.

My Lords, I join other noble Lords in welcoming the order and in thanking the Minister for his explanatory statement.

I am acutely aware of the huge sums of financial expenditure to which the appropriation order directs attention. Indeed, I was quite bemused for a while as the Minister metaphorically tossed across the Floor of the House millions of pounds in expenditure terms. At the same time, one is compelled to acknowledge that the amount the Minister quoted—£1,674 million—is only part of the total amount required by Northern Ireland public expenditure plans for 1988–89, which is in the region of £4,910 million. The Government's public expenditure plans account for some 70 per cent. of the gross domestic product of Northern Ireland. That means that in relation to the public expenditure per head of population in the United Kingdom the Northern Ireland figure is some 40 per cent. Higher.

I am not nor have I ever been an apologist for the Conservative Government's economic policies. Indeed, as my noble friend on the Front Bench, Lord Prys-Davies, has to some degree claimed when dealing with the National Health Service, I would say that there are some reasons for that relatively high percentage of public expenditure which are to be explained as a direct result of the Government's economic policies that have compounded chronic unemployment and deprivation in the Province.

However, in making any critical analysis of the situation in Northern Ireland, to be honest with myself I am concerned at least in facing up to the practical realities of the position in the Province as it comes within the context of the United Kingdom. I realise that in Northern Ireland there are distinctive historical, social, political and economic problems. The noble Lord, Lord Prys-Davies, has already referred to the fact that explanations are being offered for the public expenditure particularly in connection with the health services, which has been explained away as reductions because of the larger amount of money being spent on efforts to maintain law and order in the Province.

For those who are involved, however marginally, in public life and the parliamentary processes, there is nothing to be gained by ignoring economic facts. A more positive approach than the sulky walk-out attitude adopted when these crucial financial programmes were being debated in another place is expected from representatives and those in positions of public responsibility. In these matters the Northern Ireland people are in need of and indeed deserve a better form of representation than mere negative protest. That does not mean that I approve of the present parliamentary processes for the consideration of such appropriation orders, which have vital financial implications and policies for the Northern Ireland people.

I repeat what I have said on previous occasions in debates in this House. Surely there must be more effective and better ways of embracing and encouraging general public interest and corporate accountability in Northern Ireland as regards the need for efficient and socially relevant policy decisions about public expenditure of this kind. The Northern Ireland people must have the opportunity for a direct and representative involvement and influence at all stages of these appropriation orders, which should not merely be rubber stamped.

Along with other noble Lords, I wish to compliment the Northern Ireland Department of Finance and Personnel on the publication of the first commentary on public expenditure plans for 1988–91. The publication has been well presented and is worthy of Province-wide study and debate, which I think could achieve the active and informed public association with and accountability for financial policy matters which I have already mentioned.

In that connection, I ask the Minister whether he will request the Secretary of State to consider suitable ways in which this publication could be discussed at various departmental levels and also by statutory bodies, local district councils and other industrial and community organisations within the Province. I believe that it would serve a very good purpose in conditioning the minds and attitudes of the citizens of Northern Ireland.

I should also like to ask the Minister to use his good offices to urge the Northern Ireland Economic Council to undertake an updating of its report on the financial system in Northern Ireland published in April 1982. I understand that that report was a most useful publication. It is now somewhat out of date and it is suggested that a new issue should be undertaken by professionally competent people who are directly acquainted with business and financial matters in Northern Ireland, rather than for a report to be commissioned that will be compiled by outside consultants.

I turn to matters in the order under a few headings. Because of the time factor I shall not argue the points at issue. I hope that the Minister will accept the questions raised as reasonable, and feel that they merit consideration and a reply. Under the heading of agriculture I should like him to consider the subject of research and development and the encouragement given by DANI to agricultural producers to undertake new viable enterprises. When is DANI likely to respond to the recent report of the Northern Ireland Economic Council on Horticulture in Northern Ireland, in which there are a number of excellent recommendations about the need for cooperation and development?

Secondly, will the Minister indicate the number of applications from Northern Ireland that have been submitted to the farm diversification scheme that is being instituted by the International Fund for Ireland, which the Minister himself has already mentioned? I understand that submissions and requests for financial aid for some help with farm diversification approaches were to be in by the end of February.

How best can DANI assist in the marketing and promotion of the slurry digester project for fertiliser and methane gas production? The project has been pioneered jointly by the University of Ulster and the Bethlehem Abbey in County Antrim. I understand that the project has excellent financial export prospects as well as tremendous benefits for pollution control.

As regards the Department of Economic Development, I know that a few days ago the Secretary of State for Northern Ireland announced the sale of the 200th factory by the Northern Ireland Industrial Development Board. This is indeed a welcome sign of confidence in industrial investment in Northern Ireland and an encouraging commitment to the economic growth of the Province.

While management and workers in Northern Ireland are confronted with similar technological changes and world-wide competition as in England, Scotland and Wales, they sadly have the additional burdens of coping with various forms of terrorism and the untoward problems it creates at home and overseas.

We have only to reflect on the sad and serious events reported today in Belfast to realise the immediacy of the critical situation that exists there. I pass over that because I do not believe that there should be instant comment in this House on such events as occurred today. I hope that the Minister can inform us whether an early Statement on the events will be made by the Government, because the longer these events exist in limbo the more they gather rumour and momentum beyond the bounds of reality.

I should also like to mention the acute political schisms that tend to divert corporate community efforts in support of the common objectives required for prosperity and economic wellbeing. However, I am glad to say that management and trade union relationships in Northern Ireland have largely succeeded in gallant and practical measures to rise above the intercommunal strife and to keep the wheels of industry turning in productive employment. Both sides of industry are an anchor of safe sanity in a troubled sea. At the same time it must be openly admitted that the future for industry and commerce, for earnings and for jobs, and for human happiness in the Province, largely depends on steady improvement and stability and on the upholding of the rules of law and order in the sadly divided society in Northern Ireland.

The Minister will be aware of the widespread public expressions of concern about the plight of the health and social services in Northern Ireland. My noble friend Lord Prys-Davies has dealt with this matter in much detail and has very forthrightly put forward points to the Minister. I do not intend to speak about the general position. I believe that this subject will be debated in this House soon.

I wish to ask the Minister to deal appropriately with two urgent issues about which I have received considerable representations from individuals and from organisations. The first issue concerns the Joss Cardwell Rehabilitation Unit in East Belfast. This is a purpose built and equipped centre which is unique in that it is the only regional community based rehabilitation centre in Northern Ireland. The Eastern Health and Social Services Board proposes to dispose of this centre and to transfer only part of the services provided to two nissen huts at Musgrave Park Hospital. The alleged cash saving is stated to be about £50,000 per year. The social cost and other factors suggest that to destroy the Joss Cardwell centre would be an ill-advised and costly step for the people of Northern Ireland.

The other matter of concern is the proposed closure of the Shaftesbury Square Hospital which provides in-patient and out-patient treatment for substance abuse—mainly for alcohol abuse. I understand from public remarks and representations that have been made to me that former patients and alcoholics who have been rehabilitated are, together with local government officials, councillors and clergy, utterly astounded by and opposed to this proposed closure. I hope that the Minister will raise the matter urgently with his ministerial colleagues with the intention of having an urgent review of these proposed closures.

Finally, on 23rd February I had a Written Answer from the Minister to my Written Question about the Government's decision to discontinue the publication of the Ulster Year Book. With others in Northern Ireland, I am unhappy about the Government's decision for a number of reasons, not least the lack of readily available, helpful and detailed information about Northern Ireland affairs. However, I have had a look in the Library at the publication Britain 1988—Official Handbook. This publication was prepared by the Central Office of Information on behalf of the Foreign and Commonwealth Office. In this publication there are a number of useful references and some general information about Northern Ireland affairs. This publication, Britain 1988—Official Handbook, does not compensate for the loss of the detailed information contained in the Ulster Year Book.

Perhaps I may ask the Minister to request the Secretary of State for Northern Ireland to make suitable representations to have the title of this official handbook changed to "United Kingdom" rather than "Britain", or to the "Official Handbook of Great Britain and Northern Ireland". I believe that at least that would indicate to the wider world that Northern Ireland is still on the map and is an integral part of the United Kingdom. I support the order.

My Lords, I am grateful to my noble friend Lord Lyell for the attention that he has given to this order and for the way in which he dealt with it. I too must say how welcome is the commentary on public expenditure plans to those such as myself who find it difficult to understand such colossal figures. I should like to thank the noble Lord, Lord Prys-Davies, for the tremendous support that he has shown in his speech for the welfare of the people in the Province.

I begin by mentioning a few points relevant to the agricultural industry, because it is the largest single industry in Northern Ireland. Farmers will welcome the department's intention to accelerate payments on capital grant schemes which were completed some time ago. I hope that that will actually occur, as bank borrowings by farmers in the Province recently rose to a new record of £281 million. I realise that there is some fault on the part of farmers. Individual farmers may not have appreciated the long delays before payment. However, the build-up of interest on borrowed money seriously undermines the net value of this grant aid.

Sheep producers in the Province are genuinely concerned at what may be in store for them when the operation of sheepmeat stabilisers is being discussed in Europe. If the intention is to reduce the number of regions where separate calculations of annual ewe premium rates are permitted, there may be a very dramatic reduction of premium level in Northern Ireland. There are two sound reasons to justify special consideration for our farmers. The first is that, due to our geographical location, transport costs between the Province and outside markets are much higher than between other EC countries. Secondly, due to the topography and climate there are fewer alternative farming enterprises open to Northern Ireland farmers should the value of lamb production fall. I shall be interested to hear the Minister's reply as regards the number of applications submitted for assistance with alternative farm enterprises. I ask him to assure the House that due consideration will be given to that problem in the Province.

The beef industry in the EC has many problems. However, we in Northern Ireland have in addition one seemingly unnecessary difficulty. The lifestyle of many people living on the border with the Republic has always included petty smuggling; a few bottles of gin, a barrel of beer or even a pig run across the border. That has been normal life, although not necessarily for myself. However, in recent years it has become big business to smuggle cattle. The figures for a recent 12-month period show the extent of this. Sixteen per cent. of all beef cattle produced in Northern Ireland—that is 90,000 animals—were illegally transported into the Republic, this doing the EC out of £5.5 million, or £60 per animal, in MCA payments. That is a colossal amount of money and some action should be taken. It is also having a grave effect on employment in meat processing and related industries in the Province. I should like to ask the Minister what is being done about the situation. Is an increase in Customs and Excise staff envisaged?

In Great Britain there are several environmentally sensitive areas where farmers are participating voluntarily and where the assistance scheme is working well. In Northern Ireland one area is designated as such and that is in the region of the Mournes. It is my understanding that this scheme was to be open for applications in September of last year. I believe that that has not happened. I should like to know the cause of the delay and an accurate new starting date. It also appears that assistance in comparable areas in Great Britain may be as high as £100 or £120 per hectare. Yet the proposed rate in the Mournes is apparently to be only £30 per hectare. Those rates do not give a voluntary scheme such as this much chance of being taken up. If that is the case, perhaps the Minister will agree that they should be reviewed.

I should briefly like to bring up the subject of drainage. We have already heard several comments on it. I should like to mention a specific incident. I quote from the commentary issued by the Northern Ireland Office:

"Following the exceptional rainfall and flooding in October 1987 some increase in planned financial provision has been made, most of it to allow the bringing forward of the already planned improvement of the flood protection provisions on both sides of the River Mourne at Strabane".

Will my noble friend please comment on the situation around Maguiresbridge, which was also flooded at other times in addition; for example, on 17th August? I believe at the time of the flooding he flew over it so he knows what we are talking about. What are his plans for doing anything about that?

I should like to draw attention to the recent debate in your Lordships' House on afforestation in Northern Ireland, initiated by my noble friend the Duke of Abercorn. In the debate I pointed out that in two years' time the Forest Service would not be able to maintain its objectives of new plantations due to a shortfall of £250,000. Noting that the total programme for public expenditure in Northern Ireland for 1990–1991 is £5,510 million, surely it is not too much to ask for that increase of £250,000 to ensure the future of the Forest Service. In addition to that, arising from the Budget yesterday, it may well be that there will be a vast reduction in investment in forestry which has been recently taking place due to the tax concessions, which have now been taken away. Therefore, it seems to me that it would be even more important to ensure that the Forest Service is kept up to its targets.

I welcome the special support given to industry in Northern Ireland. However, there is no database in the Province for industrialists to consult. In Great Britain, I understand that there are several and I suggest that they save a great deal of time and money. In the Province there is no quick way of assessing, among other things, market sizes or the source of materials. Also there are many new products appearing and no central register of them. Can the Government not initiate, fund or run such a database? It would seem to be very important when investing a lot of money in industry that it should not be wasted on unnecessary research, which could easily occur if there was such a base.

At present there is concern at the reduction in overtime for the RUC. I do not bring up this subject as a result of the events in Belfast today. The Chairman of the Police Federation recently said that he was worried about the 29 per cent. reduction in overtime in the force. I am not aware of all the details or what percentage that is of the total time; but like many people in the Province I am worried about the consequences of a reduction in normal policing—that is, policing other than policing in reaction to terrorist incidents.

The situation is very volatile at present and reaction to the many terrorist incidents, or for that matter the demonstrations resulting from the incidents, is very expensive. Can the Minister reassure the House that when there is an increase in anti-terrorist operations, it will not mean a switch of available finance away from normal police activities? The threat is such at present that routine budgeting may not be sufficient to cover normal policing in times of unpredictable high terrorist activity.

I welcome, and congratulate the Government on, their proposed police building programme and note the fourfold increase in new projects forecast for the next two years. That will result in an additional burden of extra security on the RUC. I hope that my noble friend can tell us that protection of sites, workmen and transport of building materials will not also result in a reduction in normal policing.

I should like briefly to mention public relations. I am not sure that it is really a subject for this debate. However, there are few opportunities in this House to raise such an issue. I believe that in all aspects of the day-to-day government of Northern Ireland good PR leaves a lot to be desired to say the least. The press is sometimes complimentary and often critical of the Government. The true facts about controversial issues, whether housing, the National Health Service or even terrorism and the fight against it, are often never fully known to the public. The misleading and incorrect facts are always available, especially in such publications as An Phoblat, a pro-terrorist Republican news sheet.

We are losing the PR war in Northern Ireland because the correct facts are not easily available to the public. I ask my noble friend to consider that it would be of immense value for the Government to produce a monthly bulletin of facts which could be widely distributed throughout Northern Ireland and perhaps also to people in the Republic. It would be inexpensive and of great value to all.

In conclusion, I support this order but hope that some of these points might be considered.

My Lords, the noble Lord, Lord Moyola, referred to farm effluent and its pollutant effect on water courses. The noble Lord, Lord Blease, referred to slurry digestion. It so happens that the last time we were discussing an appropriation order in your Lordships' House, I mentioned both those matters.

My mention of slurry digestion evoked voluminous correspondence. In response to the Minister's usual kind letter soliciting points that we might want to raise in the debate, I copied that voluminous correspondence to him. I hasten to assure the Minister that I did not do that with a view to discouraging him from writing to me again in a similar vein. However, he has the information now, so I shall not take up your Lordships' time by going over the appetising details contained therein other than to say that perhaps the last time we discussed the matter of slurry digestion we were not entirely fully informed. There is more information than that of which I have been aware.

It seems that Bethlehem Abbey at Portglenone—or Port Glen One as the Americans called it when they were here during the war—pioneered this system but, despite representations, received a grant equivalent to only 6 per cent. of the total amount of the project. However, others who have taken advantage of the example shown by Bethlehem Abbey, in the less favoured areas, qualify, I believe, for 60 per cent. grant while, in other areas, not less favoured, the grant is 30 per cent. On the face of it, that seems to be somewhat inequitable. Perhaps the noble Lord will be good enough to look into the position in the light of this new information.

Under the Department of Agriculture Vote 1, on the matter of forestry, I should be interested to know why, three years after I raised the matter in the Northern Ireland Assembly Agriculture Committee, the Department of Agriculture nurseries still do not have adequate supplies of broadleaved young plants for those land owners who wish to establish hardwood plantations which the department is rightly trying to encourage.

On Vote 3 of the Department of Economic Development, I should like briefly to say how strongly I support Mr. John Parker, the chief executive and chairman of Harland and Wolff, who deplores those who make apprehensive and warning statements about the long term future of the shipyard. It may be that the labour force will have to be streamlined further and that the shipyard will have to rationalise itself to a certain extent to meet current and future market conditions; but anyone who casts doubt on the future of Harland and Wolff is doing nothing but a disservice. I entirely support Mr. Parker in deploring that.

I am glad to say that since I last raised the matter under Department of Environment Vote 1, the Strangford Ferry has been more dependable in its record of service. I wonder if the time has not come when the noble Lord might consult with his people to see if plans should be laid for providing a new vessel in view of the age of the two now in service. It is very seldom that both are available for service simultaneously. If one breaks down, very often the other is not in a position to stand in for it. Also, the recently imposed fare increases have proved quite a heavy burden on those who need to use the ferry on a regular basis for business. It is also used every day by children going to school—again, quite a considerable financial strain.

I ask once again why it is that the new bridge over the Foyle at Londonderry—which entailed very much heavier capital expenditure than the ferry—is regarded as being an extension of the road service with no toll payable whereas there is a charge for crossing from Portaferry to Strangford on the boat. That charge is regularly increased.

Also under the heading of the Department of Environment Vote 1, I warmly welcome the commitment of Her Majesty's Government to construct a new bridge over the Lagan for both road and rail. I understand this will be in six years' time. Looking back at previous issues of the Official Report, I believe this to be the fourth time that I have mentioned it. I am very glad and grateful that at last we have this good news. In anticipation of that and the fact that it will help to integrate the rail network in Northern Ireland, perhaps I may ask the noble Lord whether he has given any consideration to reopening the old Belfast and County Down railway line between Belfast and Comber.

I can remember trying to reason with the grandfather of the noble Viscount, Lord Brookeborough, in the late 1940s. I recall saying that even if the line to Newcastle or the extension to Ardglass is not economic, why not keep open the section to Comber to serve commuters as the population increases around the periphery of Belfast, and also in view of the increase in the number of private cars. The transport tribunal ruled that the line should be closed and that is the way it was. I honestly believe that the matter would justify a new look now.

That subject also touches on the general principle of trying to provide every incentive for people to use public transport in city centres as a whole and not only in Belfast. It is a tragedy when one sees a city centre being gutted for the sake of the motor car and becoming an extended car park. The centre of Liverpool has been sadly carved up in the interests of urban motorways.

Department of the Environment Vote 4 and the subject of the disposal of domestic waste is a matter that I have raised on a previous occasion. Since then further evidence has come to light of this problem. I believe I mentioned to the noble Lord the problem of Drumnakelly near Seaforde, County Down, which I believe is the subject of a public inquiry. The issue has aroused considerable controversy. As time goes on the problem of disposal is going to become greater and greater. I honestly believe that this is something which the department ought to address rather than leave it to individual councils to try to cope on an ad hoc basis. They lurch from one unsatisfactory expedient to another.

Turning to the Department of Education Vote 2, since Lagan College started seven years ago—and I must declare an interest because I was founding president of the college—there has been almost an explosion in the demand for integrated education in Northern Ireland. There are now seven schools either functioning or preparing to open. Such integrated schools save the Government money; they save money for the public purse because they meet their establishment costs from voluntary subscription.

Charitable foundations all over the world have been extremely generous, but one cannot expect them indefinitely to continue giving subventions for this purpose. Therefore I sincerely urge Her Majesty's Government to see whether they cannot act more expeditiously in granting maintained status to integrated schools. Of course they will have to ensure that each school will be a viable proposition before granting maintained status, but it is a very heavy burden for those schools to have to bear until such status is granted. Under the heading of the Department of Education I also wish to raise the question of the Linen Hall Library, which is under considerable financial pressure at the moment. In the year 1983–84 a grant of £54,000 was made from public funds, but this declined to £36,000 in the year 1986–87. Since then there has been an increase of £1,000 per annum, but that is not sufficient to keep pace with inflation. As I am sure the noble Lord is aware, the Linen Hall Library is an historic foundation which dates back to the 18th century and has a unique collection of books, documents and records. It provides facilities for research which are not available in the public libraries. Therefore I sincerely hope that the noble Lord may be able to use his good offices to bring about a more generous grant to the Linen Hall Library so as to ensure its future and if possible its development.

I turn now to the Department of Health and Social Security, Vote 1. Since I raised the topic of homoeopathy on April Fool's Day last year a professional survey of general practitioners for the Homoeopathic Society of Northern Ireland has been conducted. (I ought to say that only 28 per cent. responded, but that, apparently, is a normal response under the circumstances). Of those who responded, 50 per cent. said that they would refer patients to a homoeopathic clinic for treatment and diagnosis were there one available. The society has now opened a private clinic on one day per week and it is overwhelmed with customers. The clinic is to open on another half day a week because that is all that can be afforded, but it appears that it could open four or five days a week if money were available.

I know that an additional £5 million was recently granted to the health boards by the department. It would take only £10,000 of that £5 million to enable the homoeopathic clinic to run on a full-time basis. I know—though perhaps it is rather difficult to understand in view of yesterday's Budget—that the health service is stretched for money. Even so, if the noble Lord were able to assist in that way it would make a tremendous difference. I believe that it would also help to save money, because the drugs which are prescribed in conventional medicine are very expensive indeed.

Also some of the recent reports we have seen about the side effects of those drugs really do make frightening reading. I commend that point to the noble Lord most strongly.

Finally, reference is made in Vote 4 to the Department of Health and Social Security's miscalculation in the retail price index increases. I am told that throughout the United Kingdom that resulted in an underspend of £109 million. Looking at the United Kingdom overall, if £5.2 million of that figure could be devoted to the war widows' pensions and age allowance, that would enable them to benefit by another £2 a week. Futhermore, if an additional £2 million out of that underspend was similarly allocated, it would enable the minimum age to be reduced from 65 to 60.

I realise that this is a United Kingdom problem; but, nonetheless, there are war widows in Northern Ireland whose husbands were killed between 1939 and 1945 who do not receive the same benefits as the widows of servicemen who have been killed since that time. I warmly commend that suggestion to the noble Lord, because I think that it would be a most humane and appropriate way of using some of the money which was underspent as a result of that miscalculation.

I should like once again to thank the noble Lord for his presentation of the appropriation order. We appreciate the interest that he takes in Northern Ireland and I have often sympathised with him, saying to myself, "Thank heavens it is him, not me, who has to carry out this thankless task, with the constrictions that are laid upon him, in situations where he can't always do what he would wish". Nevertheless, we appreciate his efforts and the close interest he takes in our affairs.

My Lords, in view of the awful events which took place in Belfast today in my former constituency, I decided not to take part in the debate. Although there are many facts of life that one could discuss within the context of this order, I am sure that there are not many people in Belfast tonight, certainly not in West Belfast, who are worrying about the discussions taking place in this House.

However, I rise for one or two minutes to reinforce what has been said by my noble friends Lord Prys-Davies and Lord Blease in relation to the health service in Northern Ireland. Throughout my lifetime Northern Ireland has always had a health service of which one could be justifiably proud. I have always believed that we had some of the best, if not, indeed, the best hospitals to be found anywhere in the world. We have always had dedicated staff who have served the community in Northern Ireland and given a service such as no one would have received in any other part of the United Kingdom.

Although I do not live in Northern Ireland I am nevertheless in daily communication with people there. I receive many letters. From the mail that I receive I could be persuaded that Northern Ireland's health service is in something of a crisis at present. I have had representations made to me from almost every major hospital in the Province: first, the Royal Victoria Hospital in relation to its ophthalmic unit, where there are to be severe cutbacks; secondly, the Mater Hospital, where again there are to be severe cutbacks in the staff and the nurses; thirdly, the Shaftesbury Hospital. Here I strongly support what has been said by my noble friend Lord Blease in relation to the proposed closure of that hospital. It would have an awful effect on many people if the alcoholic unit of the hospital is closed. It has been there for many years and I believe it has given sterling service to those who have been unfortunate enough to seek treatment there.

Finally, there is yet another hospital in North Belfast, the Throne Hospital, which is scheduled for closure. It has been there for over 100 years and has looked after many geriatrics, especially from the North and West Belfast area. If it is closed those who would otherwise have become patients within its walls will be transferred to Dundonald Hospital, which is at the other end of the city of Belfast.

As I said, there are problems in every major hospital in Northern Ireland. I have had representations from Downpatrick in County Down. People are worried about the extent to which the health service in Northern Ireland will be affected by what would appear to be government policy. Living here in London as I do I am only too well aware of the great crisis affecting hospitals in the United Kingdom, especially in London. I should have hoped that the same crisis would not affect hospitals in Northern Ireland. It is.

I rise this evening only fully to reinforce and support the pleas that have been made by my two noble friends and to ask the Minister to ensure that in any future appropriations priority is given to the Northern I eland health service to ensure that it can maintain the standards it has set over so many years.

My Lords, as is traditional on occasions such as this, we have had a full and detailed debate on the complicated figures that I presented to the House. I compliment and am grateful to your Lordships for the patience with which you listened when I dealt with some of the salient points of the Estimates. Judging by the questions that I have been asked, your enthusiasm for figures never diminishes.

The noble Lord, Lord Prys-Davies, had a number of queries. I shall attempt to answer most of them tonight. He will appreciate that I may want to examine one or two points more carefully. I shall write to him quickly and I hope fairly briefly. He asked about the amount of subsidy to the manufacturing sector in recent years. In 1987–88, the current financial year, the planned level of expenditure per employee in manufacturing industry was equivalent to about £1,640. At this stage, within three weeks of the end of the financial year, it seems likely that the actual figure will be about £1,840 per manufacturing employee. That is a rise of about 12.5 per cent. over what we planned. Assuming that the pattern of employment stays as at present, the planned level of expenditure on support for manufacturing for 1988–89 will be about £1,740 per employee. As your Lordships can see, that figure is likely to vary during the course of the year.

The noble Lord also mentioned the dependency of industry. I wish to reassure him about the Government's policy with regard to reducing industry's dependence on public funds. He asked whether it masks an intention to reduce public investment in economic programmes in Northern Ireland. I can tell him that in November last year my right honourable friend the Secretary of State in his public expenditure Statement made in another place, in which he gives details of expenditure in Northern Ireland, confirmed that the strengthening of the economy would remain a key priority within the overall public expenditure strategy for the Province. That is contained in the booklet at which we have been looking this evening.

The noble Lords, Lord Prys-Davies, Lord Blease and Lord Fitt, in their short remarks, raised the question of expenditure in the health service. As regards that capital expenditure I would spell out straight away and honestly that there are other pressures on the health and social services budget as well as on the Northern Ireland block overall. We had intended to reduce capital spending on the health service by £5 million in the next financial year, 1988–89. However, we held detailed discussions with the various chairmen in the health and social services board and decided to restore the capital budget to its normal level of £29 million in the next financial year. My honourable friend the Minister who has responsibility for that aspect of life in Northern Ireland is consulting the hoard as to how the additional funds can best be supplied. I would not be able to comment this evening on the total programme.

The noble Lord, Lord Prys-Davies, also asked about the report by the United Medical Enterprise. We are very grateful to him for drawing attention to the report commissioned earlier last year by the Industrial Development Board for Northern Ireland. The board and the DHSS issued the report jointly to a wide range of interested bodies for comment on 10th December last year. I am afraid it was rather inconvenient before the start of the Christmas holiday period, but in issuing the report to as wide a range as possible both the IDB and the DHSS welcomed the prospect identified by it for creating jobs and generating additional income by marketing the very interesting and sophisticated Northern Ireland health services, as well as their expertise, all over the world. The comments which we have received have indicated broad support for this concept.

Of course there has been some concern that the level and quality of services presently available to the population in Northern Ireland should not suffer as a result. Certainly I should want to assure the noble Lords, Lord Prys-Davies and Lord Blease, about their concern that the valuable health services and resources might be diverted in this plan. That will be taken fully into account when we decide how we take forward the United Medical Enterprise report, as well as the current capital expenditure in the Province.

The noble Lords, Lord Prys-Davies and Lord Blease, and others will want to know about the large amount of expenditure on health and personal social services in Northern Ireland. Next year, 1988–89, it will amount to £850 million, an increase of nearly £40 million on spending in the current year. Per capita expenditure in Northern Ireland will continue to be over 20 per cent. higher than in England and Wales, as the noble Lord, Lord Prys-Davies, will know. Pace Wales I am not able to give the precise details for England, and I think my figures say higher than England, so if I say England and Wales noble Lords will agree with me. There are certainly areas within this figure where the factors for morbidity and other problems are virtually the same as for Northern Ireland. But this gap in per capita expenditure in Northern Ireland over and above that of England and Wales reflects the response of the Government to the needs of the Province.

In a perfectly fair aside, the noble Lord also took the Government to task for the fact that the health programme has been very slightly constrained by the need to put additional resources into the law and order programme. The resources which we have to place in any particular aspect of life or particular department in Northern Ireland are finite. However, the needs of Northern Ireland in health and social services are recognised in the comparatively high levels of public expenditure which are enjoyed in the Province. The figure of 20 per cent. is one particular aspect of that.

The noble Lord, Lord Prys-Davies, raised another query about education and the universities. The relationship between the University Grants Committee and my right honourable friend the Secretary of State is somewhat unique as regards Northern Ireland. In line with my right honourable friend's overall responsibilities for the allocation of the Northern Ireland block, he takes decisions about the funding of higher education on the basis of advice he receives from the UGC. My right honourable friend takes the final decision. I wish to stress, however, that he takes the decisions with the full knowledge of what is required on the basis of very strong advice from the UGC.

Are the powers of the Department of Education and Science in relation to the UGC and its successor body exercised solely by Northern Ireland or jointly with Northern Ireland? Education in Northern Ireland is a transferred matter. As such it is the responsibility of the Department of Education in Northern Ireland; it certainly is nothing to do with the Department of Education and Science in London.

Treasury funding for the Northern Ireland block of higher education rests with my right honourable friend the Secretary of State. Of course he acts again on the basis of advice that he receives from the UGC. The noble Lord, Lord Prys-Davies, asked about the reduction in the housing budget for next year, 1989. There was a reduction and I think my noble friend Lord Brookeborough had one particular query about it. Certainly, the Housing Executive was consulted before the housing budget was reduced.

I understand that the honourable Member for Wiltshire North, who is responsible for the health and environment departments did in fact consult and inform the chairman of the Housing Executive of the proposed transfer of resources before it was made public. However, I could not say how far or how deeply my honourable friend was able to take those consultations.

The noble Lord, Lord Hylton, raised a number of points. I was grateful for the clarity with which he set out his questions. As regards the election of members to statutory boards and the noble Lord's ideas on that aspect, I hope that he will accept that that is not something that I would like to answer tonight. I shall certainly bring his suggestions to the attention of my right honourable and honourable friends. If I can add anything to the remarks or enlighten him at all, I shall certainly do so but in writing, not tonight.

On the question raised about the payment of debts and the 1971 Act, your Lordships will be aware that in Northern Ireland there is a history of some quite longstanding debts, some of which have been incurred as a demonstration of political protest. That has happened in recent years as well as in 1971 and before. The continuing high levels of public debt in the Province coupled with the action taken by one or two members of the Loyalist community to withhold payments for such things as rent, rates and above all car tax as a political protest gives some illustration of the need to maintain an adequate debt recovery system.

But the need for the legislation concerned will continue to be reviewed at least annually by my right honourable friend the Secretary of State. As far as I am aware from figures that I have seen, the overall public debt figure for Northern Ireland is being reduced. It has come down quite sharply since 1984 which was my first year serving in the Province.

Perhaps I may return to the matter of the allocation of the £5 million from the housing programme to the health programme. The noble Lord, Lord Hylton, raised the matter of the importance of housing and how that is perceived in the Province. The decision taken recently to transfer £5 million from the 1988–89 housing programme to the health programme was taken after careful consideration. It was not taken lightly. The money to be transferred will be used for capital projects which will help the health and social services boards to rationalise some services in ways which will help to release resources for other purposes, thus facilitating the implementation of the regional strategy for health and personal social services.

The reduction in the housing programme is something which all of us regret. We wish to provide more resources and would do so if they were available. However, your Lordships will be aware that the Northern Ireland housing programme benefited from the high priority which has been accorded to it in recent years. My honourable and right honourable colleagues in another place will testify to my thoughts when we get together to discuss the Northern Ireland block grant. I believe that agriculture does not receive its fair share and that housing, health and social services must all be taken into account. However, I think all your Lordships will agree that housing has had a priority which it deserves.

Even after the transfer of £5 million for 1989, the gross programme will amount to £545 million. That is a transfer of under 1 per cent. The programme is at a level which is much higher per head of population than is the case elsewhere in the United Kingdom. It is true that the need is greater. However, per capita spending on housing, as well as on health and social services, is a great deal higher than that in England.

The noble Lord, Lord Hylton, raised the matter of the Divis flats. I am advised that five SECTRA blocks—perhaps the noble Lord will be familiar with that—are included in a total which is in the region of 295 units. I am not sure that that is correct. However, I believe that that indicates that there are 59 units per block. Five of those blocks have been demolished since 1984 and further block of 43 units is about to be demolished. The remaining six SECTRA blocks will be demolished over a period in line with the programme of the Housing Executive for phased development in that area. The whole process of demolition of the 12 blocks will take up to 10 years. Progress will be subject to a periodic review in the light of the circumstances and also in the light of availability of alternative accommodation. To date, the majority of tenants have been rehoused in the Lower Falls area. But in the later phases the important matter will be the willingness of some residents to accept rehousing outside that area.

The noble Lord, Lord Hylton, raised a query about land. There is little alternative land available in the immediate area around the Divis complex. The Housing Executive is investigating the availability of land in West Belfast generally to meet needs which are mainly short term. Longer-term housing needs in the Belfast area are addressed in the draft Belfast urban area plan that has been published for consultation. It will be the subject of a public inquiry later this year.

My noble friend Lord Moyola was kind enough to entertain me in his home, as he has suggested. Your Lordships will know that when a Minister pays a visit many other people also attend. I, my department and everybody who was involved are grateful to my noble friend, not least for what might be called the feeding of the five thousand. We also had a delicious lunch. That applied not only to me and my immediate entourage but to many people from my department. It was a major meeting, and we are grateful for all that he and his wife did for us.

My noble friend then raised—rightly so—several queries about salmon. As to the co-ordinated service programme of the Royal Air Force and the Royal Navy, I have been unable as yet to obtain any answers to give encouragement to my noble friend. However, I assure him that I shall persist in my efforts to establish whether anything can be done, above all on a cost-effective basis. As he will know—indeed, he raised this in his remarks—there is the question of enforcement of fishing laws in the sea outside the 12-mile limit. This gives rise to some difficulty. Fishing for salmon outside the 12-mile limit is illegal in UK waters. Our fishery protection role ensures that it does not take place within our jurisdiction in respect of fisheries.

My noble friend raised the question of what takes place off the Donegal coast. The recent report by the salmon review group, which was set up by the Minister in the Republic of Ireland, acknowledged the existence of illegal drift net fishing. That will not be news to my noble friend. One of the major recommendations of the report was that there should be an attempt to curtail the activities of drift net fishing, which would include the introduction of a salmon tagging scheme with a quota of tags for every licence. I shall follow with great interest any developments to ascertain whether regulations along this line may be implemented. If so, and if they were successful, they might go some way to rehabilitate the salmon stocking levels in Northern Ireland rivers. However, I must sound one small warning. The tagging of salmon costs quite a lot of money. If more money is to be spent, it will require careful consideration by my department and by my colleagues. We shall bear that aspect in mind.

My noble friend referred to dealers and the trade in salmon. The dealer register system was provided for in the recent salmon legislation covering Great Britain. There has been a dealer register system in Northern Ireland since the passing of the Fisheries Act 1966. I cannot recall whether my noble friend occupied the office that I now occupy, but I am given to understand that the system has been operating since then. If I can obtain any further information, I shall write to him.

He asked next about the Fishery Conservancy Board and the possibility of a fish counter. A fish counter is a very useful component in an overall management programme for a salmon fishery. Fish counters are not only sophisticated; they are expensive. They must be carefully sited, installed and maintained. If there is a combination of all three, unreliable results may be obtained. In any large river system, one has to take various counts. There would therefore need to be a number of counters on the various tributaries. Before we embark on counters—and not only on the main river and its branches, but on all the tributaries—it may be necessary to consult the various owners of the fishery systems collectively to develop a management programme in order to include the provision of monitoring equipment and any initial restocking of the rivers

So far as concerns the fisheries protection vessel and the rumours that have come to the ears of my noble friend, I reiterate that one of the recommendations contained in the report of sundry members of my department who had a review team surveying the management of operations of the Fisheries Conservancy Board for Northern Ireland is that the Department of Agriculture and the board together should review the operations of sea patrols to protect salmon. We are still waiting to undertake full discussions with the Fisheries Conservancy Board.

No decision has yet been made as to what should be done about sea patrols. However, I am sure that my noble friend will accept that the board wants to and indeed must carry out its functions in a cost-effective manner. Given that, I hope that he will accept my assurance that I take very seriously the protection of salmon so far as possible by the method of sea patrols.

My noble friend also raised the question of the restocking of rivers. My department continually restocks its own waters and certainly the Movanagher Fish Farm is available to provide any stocks, above all of trout, for sale, which will be able to assist other owners. Certainly there is no more news on that tonight. I hope that that concludes the queries about fish raised by my noble friend. If there is anything else that I have missed I shall certainly write to him—certainly if it concerns salmon or trout.

My noble friend went into the more murky areas of what we might call slurry. In November 1987 additional funds were made available for grants for slurry tanks and the scheme was re-opened for payment of grants to farmers who had had their work completed and claims submitted by 29th February this year. I had to make the announcement of when the scheme was to be opened. I made it clear that it might be necessary to restrict the scheme to ensure that expenditure would not exceed available funds. I am sure that my noble friend and the noble Lord, Lord Dunleath, will be aware that disposal of slurry and slurry pits are a particularly important aspect of farming in Northern Ireland.

After I announced the re-opening of this scheme the demand for grant was demonstrated by the very high level of prior notification forms received from farmers. It reached a point where it became necessary to announce the additional requirement that grants would be available only in cases where prior notifications had been acknowledged before 1st January 1988. I indicated that I would make a further announcement about the future of the schemes as soon as possible after 29th February this year. At present I am considering various options which might allow a reintroduction of the scheme, which will be tailored to available funds. I hope to make an announcement on that as soon as possible.

In conclusion, as regards the slurry tanks, I stress to my noble friend that grants for waste and effluent facilities remain available to farmers who are eligible for and undertake a farm improvement plan under the agricultural improvement regulations. The rates of grant are similar to those available under the national agricultural improvement scheme.

My noble friend also raised the question of drainage and above all the right of access. The position may have changed since he was responsible for agricultural matters as the Minister in Northern Ireland, but the department has a right of access to land for the purpose of carrying out drainage schemes, which are now enshrined in the legislation under Article 14 of the Drainage (Northern Ireland) Order 1973.

Before undertaking any works or entering land, the department discusses with individual landowners the work that it intends to carry out and following those discussions it confirms its proposals in writing to each individual who may be affected by the work. Following the introduction of this simplified system, the department no longer asks landowners to sign agreements permitting access across land to river banks. It is empowered to maintain the banks of designated water courses. But I am afraid that the department also has to be satisfied that such works are financially worthwhile.

My noble friend Lord Brookeborough also asked about the effect of drainage upstream. In all the drainage schemes which cover arterial drainage, the department aims to strike an acceptable balance between drainage and flood protection requirements as well as conservation and other interests. To this end detailed surveys and consultations are very closely undertaken before any scheme is finalised. Both my noble friends will appreciate that it is not possible to guarantee immunity from flooding in all circumstances. However, I wish to assure them that my department sets standards of flood protection appropriate to the purposes of its schemes. We take account of the need to accommodate any subsequent changes in what we call the pattern of water flow, but this is within the entire catchment area, as well as taking account of the statistical probability of high river levels which occur every so often and with interesting regularity in Northern Ireland.

The noble Lord, Lord Blease, asked about a Statement on what has happened tonight. I have to ask him to wait and see. He raised one point about the public expenditure commentary in Northern Ireland. We are very grateful for his welcome of the commentary as well as his suggestion that it should be the subject of wider discussion in the Province. I do not know whether this could be done effectively through a formal process, but I wish to assure him that the Government will certainly consider with very great interest any reservations or observations which we receive on the contents of that commentary.

On a point of detail, the noble Lord asked about the Joss Cardwell Centre, as well as the Shaftesbury Square alcoholic unit. The Eastern Health and Social Services Board recently published its range of options for a rationalisation of services in the next financial year, 1988–89, to achieve any valuable service development which would be in line with the strategy for the region and to help the boards to live within the resources available. Two of the options available relate to the closure of the Joss Cardwell Centre as well as the Shaftesbury Square Hospital, but in each case the proposal does not involve any reduction in service. I am afraid that it results in the relocation of current activity to other sites. This gives a concentration of service and a more cost-effective use of resources. I am afraid that that criterion is paramount in all my remarks as well as what we are discussing today. However, the proposals that I have mentioned are possible options at this stage and are subject to consultation with the eastern board.

The noble Lord, Lord Blease, raised three further queries. On the international fund, my department, the Department of Agriculture for Northern Ireland, administers the farm diversification scheme in Northern Ireland on behalf of the international fund for Ireland, but the board, as he will be aware, is independent of both Governments in the United Kingdom as well as in the Republic. He will find satisfaction on any questions in relation to the operation of the schemes under the auspices of the board if he gets in touch with its chairman. I have no doubt that the chairman will note what has been said tonight. If there is a particular query perhaps he might be able to contact the chairman.

The noble Lord raised the question of the Ulster Year Book. The decision to discontinue publication was taken because in terms of staff time its substantial cost could not be justified for a book of which only 500 copies were sold. I understand that there was a considerable number of other copies. However, they were not sold and no revenue was forthcoming to compensate for the heavy costs involved. In addition the statistical and descriptive information in the year book is available from other sources. I shall draw the attention of my right honourable friend to the remarks made about the title of the publication.

I have not seen a copy of the Northern Ireland Economic Council report on horticulture. I shall certainly study with great interest all the recommedations made in it. If the noble Lord wishes to contact me in the near future I may be able to reply. He may wish to do so here or in Belfast.

My noble friend Lord Brookeborough raised a number of points. The first point concerned the sheepmeat regime. I should like to assure him and every sheep farmer in Northern Ireland that in the discussions on that regime we shall put forward a strong case to ensure that no sheep farmers in Northern Ireland suffer disadvantage. His concerns will be taken into account and I assure my noble friends Lord Brookeborough and Lord Moyola that those concerns are being pushed most strongly with my colleagues representing us in Brussels.

I am delighted to know that my noble friend Lord Brookeborough is one of the few people on the border who does not admit to a few bovines moving hither and thither. It is nice to rejoice when there is one honest man; there must be quite a few sinners in his area. The incentive to smuggle cattle out of Northern Ireland and to evade the monetary compensatory levy has been much less during the last six months for various reasons. The recent strengthening of sterling will be of considerable assistance.

I am not able to confirm the estimate of the number of cattle that were smuggled, although perhaps my noble friend's figures may have a bearing on the truth. He and other noble Lords will know that it is difficult to obtain accurate figures as regards illicit cross-border trade.

My noble friend asked about environmentally sensitive areas. He will be glad to know that I hope to make an announcement fairly soon on the designation of the Mourne Mountains and Sleive Croob, Northern Ireland's first environmentally sensitive areas. He also queried the rate of annual payment, which I believe he thought would be in the region of £30 per hectare. The scheme is voluntary for the farmers who enter into it. They will be required to enter into a five-year management agreement. We wish to wait in order to observe the developments when the scheme is announced and opened.

My noble friend Lord Brookeborough also raised a query much nearer his home about Maguiresbridge. I arrived at Maguiresbridge on the morning after the major floods in October when I flew into the area and visited homes. I also visited Mr. Carey's shop, which had lost most of its stock. However, we managed to purchase sundry items of refreshment for our onward trip to Strabane and Omagh. The problems caused by the flooding in Maguiresbridge and elsewhere were of a different kind to those experienced in Strabane, where the flood wall collapsed and there was a serious risk of loss of life. However, we shall progress with the work in Strabane and take to heart any lessons learnt—and we have learnt quite a few—in all aspects not only in Strabane but also in the Colebrook area and Maguiresbridge, which is close to the heart of my noble friend.

My noble friend raised a particular query about forestry and the planting rate. It may well be a bit below our current target. That is caused by one major problem; namely, the difficulties of land acquisition. However, I hope that we can improve our performance in this area in future years. With regard to yesterday's Budget, as my noble friend will appreciate, it is rather early to give any indication of our own planting intentions, let along those of the private sector.

With regard to the database for industry in Northern Ireland, the IDB maintains a capability register which will provide information on 3,500 companies in manufacturing and tradeable services. That will go further and give details of 8,000 products and services available. That is no mere extension of the former trade directory. It incorporates the use of standard, industrial classification codes.

My noble friend asked lastly about the RUC overtime. The particular figure is not covered by the draft order before the House this evening but the budget for RUC expenditure for 1987–88—the current financial year—has been increased to £366 million. That will go up to £384 million next year. That is an increase of 20 per cent. over two years. The chief constable of the RUC allocates overtime on a divisional basis. A reserve is held centrally to enable the force to deal with unforseen events without undue disruption to normal divisional activity. We hope that overtime working will fall. It seems that it will fall by 5 per cent. below current levels as a result of improved efficiency and the expansion of 250 officers in the full time Reserve. However, we are sure that that will not have an impact an operational activity.

The noble Lord, Lord Dunleath, was good enough to say some very kind words about me and I return them to him. His work both here and at Stormont when he was Deputy Speaker of the assembly is much appreciated. We believe that he is a foremost practitioner of the political art both in Northern Ireland and here.

The noble Lord raised a fascinating question of slurry and, I think he called it "the slurry digester", at what he called "Port Glen One" or Portglenone at the Abbey. I should like to make two points about that particular device. Grant aid was paid by the Department of Agriculture on elements of the installation which were eligible under the current agricultural and horticultural grant scheme, which, as I said at the outset of my remarks, is now discontinued. Grants could not be paid under this scheme for investments which attracted other government assistance and I understand that grants were paid to the installers of that particular system where grant aid was available from other sources.

The installation at the Abbey suits a particular set of circumstances which are evident there. I wonder whether the noble Lord knows that only about five out of the 18 installations in England are still operating—not entirely through maladministration or incompetence. These devices are most interesting and could be effective but they are not a panacea, not even for Northern Ireland.

The noble Lord took me to task mildly about planting and broadleaved trees. As I would stress to him, it is not the policy of the forest service to produce all the various species of conifers as well as broadleaved trees which may be required by farmers or, indeed, estate owners and other planters in Northern Ireland. However, we have a surplus of some species of trees and these are offered for sale to the public. I hope that the noble Lord will accept that the private nurseries in Northern Ireland can and do supply both conifers and broadleaved forest trees and are very willing to supply whatever is demanded. If the noble Lord has any difficulties and he needs some exotic species, he will perhaps let me know.

With regard to Harland and Wolff, we are fully aware that shipbuilding is a very expensive industry. It absorbs a high percentage of public funds. We keep those funds under review but we have made it perfectly clear—and I do so again this evening—that the future of this firm depends on the company's ability to secure new orders within some rather difficult constraints; namely EC No. 6 Directive on Shipbuilding which limits the government subsidy on merchant shipbuilding to 28 per cent.

The noble Lord asked about Portaferry. Of course, we accept that the Strangford ferry plays a particularly important role in the life of the Ards peninsula as well as the Lecale peninsula. We have had a survey by experienced marine consultants who are satisfied that the existing two vessels can give useful service for some time to come. This is, of course, subject to a carefully planned maintenance programme.

As regards fares, the noble Lord will be aware that the Government have to bear part of the cost of providing this service. I am afraid that reality must be faced. The annual cost of the provision of the service at its existing level, as well as what users would have to pay for the benefit they get from it, has to be taken into account when we look at what the service can achieve.

On the Comber railway, we are delighted that the noble Lord has taken to heart the possibility and the proposal for a cross-harbour railway link between the central station and York Road. As regards the Comber railway, the noble Lord will know that various parts of the track bed of the railway are going to be used as a road. I believe it would be difficult to restore it for rail transport with all the ballasting and track that would be required.

With regard to public transport and car parking in Belfast city centre, the Belfast urban area plan makes a number of proposals for improving and developing both bus and rail services. The Northern Ireland Department of the Environment is engaged in continuing discussion with the transport companies on how to improve the services but perhaps I should not repeat tonight the remarks of the noble Lord in the Northern Ireland Assembly when he became involved in car parks and other facilities—it concerned a lady friend of his. We leave that aspect for another night.

The noble Lord also asked about waste disposal sites and Drumnakelly. He will be aware that this site is the subject of an inquiry into an application by Down District Council for an order and there is nothing more I can say tonight.

As regards the Linen Hall Library, the noble Lord will know that in recognition of the bicentenary in 1988 the Department of Education has been able to provide £50,000 to meet the cost of the computerisation plans. Subject to approval we plan to increase the grant to the library next year, 1988–89, by £15,000 to assist in the running costs of the new computerised system.

I will have to write to the noble Lord on the subject of homoeopathy.

On the payment to compensate for the error in the retail price index, a special lump sum payment was made in February this year to cover the loss of benefit for the period April 1987 to April 1989. It covered the categories receiving, I think, 14 or 15 benefits who were entitled to a special payment of £8 for the week commencing in February 1988; but perhaps I may write to the noble Lord on the 15 categories of benefit recipients.

I hope that covers all the questions that have been raised. We have the opportunity for a full discussion of all aspects of Northern Ireland on only two or three occasions during the year. I therefore hope your Lordships will forgive me if I have taken a considerable amount of time to answer the questions that your Lordships were kind enough to warn me would be raised. I hope that I have answered most of them. Doubtless, I shall have to fill in plenty of gaps in writing.

On Question, Motion agreed to.