asked the Joint Under-Secretary of State for Education and Science, as representing the Minister of Technology, what progress has been made in the development of the Vulcain reactor; and what has been the share of the cost borne by the Atomic Energy Authority.

Basic engineering and physics work forming part of the programme of research and development into the Vulcain reactor is now almost complete and a Vulcain-type core will be loaded in the Belgian experimental reactor, BR3, in mid-1965, for irradiation to high burn-up. The cost borne to date by the Atomic Energy Authority is approximately £1·6 million.

Does this mean that any difficulties in the development of this reactor have now been overcome?

Yes, Sir.

Does the hon. Gentleman agree that at this stage of the development of the Vulcain reactor the only way to make further progress is to build an actual ship, and will he say which Minister is responsible for the building of a ship? Is it the Minister of Technology, the Minister of Transport or the President of the Board of Trade?

I would have thought that the right hon. Gentleman would have known the answer to that question.

I put a perfectly serious question to the hon. Gentleman. My knowledge of the Vulcain is that the only way in which we shall make progress is by the actual building of a ship. I was asking the hon. Gentleman if he agreed with that or not and which Minister was responsible for the building of a ship—was it the Minister of Technology, the President of the Board of Trade or the Minister of Transport?

Perhaps the right hon. Gentleman will put down that question.

On a point of order, Mr. Speaker. I think that this flows from the original Question put down by my hon. Friend. It is relevant to the original Question, and I think that the hon. Gentleman should treat the House with more courtesy.

The right hon. Gentleman addressed me on a point of order. None arises. I cannot make the Minister answer if he does not want to.

asked the Joint Under-Secretary of State for Education and Science, as representing the Minister of Technology, what progress is being made in co-ordinating the results of studies being made of progress in the field of automation; and if he will make a statement.

The need for formal arrangements for co-ordination in addition to the ordinary processes of consultation between the Departments concerned is under consideration.

Would not the hon. Gentleman agree that the biggest task of this new Ministry must be to chart the progress of automation and to gather together all the relevant information about it? Can he say in what way the recently announced intention of the sponsorship of four key and progressive industries is going to help in this direction?

The Minister is, of course, considering this, and I have no further statement to make at the moment.

asked the Joint Under-Secretary of State for Education and Science, as representing the Minister of Technology, if he will make a statement about his plans to increase productivity in British industry.

Technological advance is a key factor in increasing productivity and much of the work of the D.S.I.R. research stations and the grant-aided research associations assists such improvements. The right hon. Gentleman is taking steps to intensify this work. He is setting up expert teams to study what needs to be done in a number of selected industries both by the industries themselves and the Government to increase their rate of technological growth.

In a recent Press interview, the Minister referred to his excitement at the prospect of the plans which he had in mind. May we be told a little more about what excites him in this regard? What, for example, are the particular powers he has it in mind to acquire? Will he compel companies to invest? Will he compel unions to drop restrictive practices, because unless that is done there can be very little technological progress?

I think the excitement will come when the Minister comes to the House.

Would the Under-Secretary tell the Chancellor of the Exchequer that the best way to get productive investment in industry is to allow individuals to invest more money themselves rather than the Government?

The Minister will take note of that question.

Does my hon. Friend realise that full use is not being made of the Dounreay scientific organisation in regard to productivity? Will he pay some attention to using the scientists who are there for the purpose of applying more scientific methods to productivity in industry?

I know my hon. and learned Friend's interest in Dounreay. I can assure him that the scientists are being properly used. In any case, there is a Question later on the Order Paper dealing with this subject.

When may we expect the excitement of the Minister answering Questions in the House?

Very shortly.

asked the Joint Under-Secretary of State for Education and Science, as representing the Minister of Technology, what contracts the United Kingdom Atomic Energy Authority has obtained from abroad for the reprocessing of uranium fuels.

The Atomic Energy Authority has so far obtained seven contracts for reprocessing uranium fuels from material testing and experimental reactors in Australia, Denmark, West Germany, India and France, and from the Latina nuclear power station in Italy.

Would not the hon. Gentleman agree that this is a most valuable form of export earnings and one which is likely to increase in the future? Will he give an assurance to the House that nothing the Minister does in the defence field is likely to affect our capacity to undertake these reprocessing contracts?

The Atomic Energy Authority is determined to exploit to the maximum possible extent the commercial advantages of the new plant at Wind-scale, which is the largest commercial reprocessing plant in the world, and that will contribute to what the hon. Gentleman has in mind.

asked the Joint Under-Secretary of State for Education and Science, as representing the Minister of Technology, whether he has now considered the construction of a high output pilot power station using a fast breeder reactor; and whether he proposes to locate this at Dounreay.

asked the Joint Under-Secretary of State for Education and Science, as representing the Minister of Technology, if he is aware of the need for urgency in arriving at a decision on the building and siting of the prototype fast reactor; and when he will give his decision.

The decision to proceed with a prototype fast reactor must await the outcome of the current development programme based on the experimental reactor at Dounreay and particularly on the design of the fuel. It will be some time before the Authority will be in a position to submit a proposal to the Government.

Is the Under-Secretary aware that there are many who will be disappointed with this progress? Some of us had the privilege of visiting this establishment some fifteen months ago and we had hoped by now to have had positive proposals for a pilot project to take advantage of some very valuable experiments and research which have already been carried out.

I am sorry that the hon. Gentleman is disappointed. There is still considerable work to be done before the site is decided upon and the development takes place. It is not likely that the Atomic Energy Authority will be in a position to submit plans until the end of next year.

May I again ask the Under-Secretary which Minister will be in charge of this fast breeder reactor? Will it be the Minister of Technology or the Minister of Power?

Presumably, if the Bill which is now before the House is expedited and passed, it will be the Minister of Technology.

When the Minister is making his decision, will he take into account social factors arising in the north of Scotland and also the technical factors, in that there are assembled there a team which has been already extremely successful in leading the world in the production of an experimental fast reactor?

Yes, Sir. The Government are very conscious of the social and economic needs of the north of Scotland, and these will be an important factor to be considered in coming to a decision.

Why cannot the Minister tell us definitely that, if we are to go ahead with the prototype fast breeder reactor, it will certainly be at Dounreay and not at alternative sites?

There are more considerations to it than the social and economic ones, but these are extremely important. The scientific considerations also will come into this in a very important way.

Referring back to the question asked by my right hon. Friend the Member for Wallasey (Mr. Marples), will whichever Minister is in charge of this project ensure that the views of the Central Electricity Generating Board, which is after all the sole operator, are fully considered and given the prominence they deserve?

I would prefer the hon. Gentleman to table a Question on that.

asked the Joint Under-Secretary of State for Education and Science, as representing the Minister of Technology, what new research projects he has now started; what is the cost to public funds; what research projects he has now cancelled; and what is the saving to public funds.

I have nothing to add to the Answers I gave to the hon. Member on these points on 1st December.

Is the Under-Secretary aware that both those Answers were, "None, Sir"? If there is the same rate of progress after sixty days as there was after thirty days, may I venture the hope that if his Minister does ever get elected to the House he will not allow his Parliamentary duties to interfere with this dynamic rate of progress?

The answer to the first part of the question is "Yes, Sir", and I am sure that the hon. Gentleman will be surprised.

asked the Joint Under-Secretary of State for Education and Science, as representing the Minister of Technology, whether, in view of the drain on sterling because of the importation of machine tools, he will take steps to set up an experimental and development centre for machine tools and the facilities for manufacturing these tools to be publicly owned and in a position to compete with private industry.

The right hon. Gentleman is making an urgent study of the problems of the machine tool industry with a view to assessing what is the best contribution he can make to their solution.

While thanking my hon. Friend for that reply, may I ask him to impress upon the Minister the fact that some of us on this side see the failure of the machine tool industry to meet the requirements of the nation at present as a problem requiring urgent action?

Yes, Sir.

Is the Under-Secretary aware that this Question betrays a truly terrifying misunderstanding of what trade and industry are all about and that this misunderstanding is very prevalent amongst hon. Members opposite?

Certainly nobody on this side is trying to damn the trade, if that is the impression given in the Question. My right hon. Friend will do his best to assist the trade in assisting the nation in its export drive and in other ways.

Is my hon. Friend aware that if terror is to be introduced into this discussion it is terror on the part of those who are watching the interests of our economy? Is he further aware that a technical examination of this industry should be accompanied by an examination of the distribution system in this country whereby distributors of domestically produced machine tools are also substantial importers of machine tools from abroad, for no better reason than pure profit, of course?

Yes. The Minister is well aware of these facts. I should have thought that the assistance that he will be giving to this industry would have nothing to do with terror, but would be appreciated.

Would the Under-Secretary make it clear to his hon. Friends that in 1963 the machine tool industry reached an all-time record for exports and this year will increase them even further? If they should feel more help should be given, would it not be appropriate to make an increased subscription to the Machine Tool Industry Research Association at Macclesfield rather than set up a Government institution of the type suggested in the Question.

Consideration will be given to the hon. Gentleman's suggestion in the second part of his supplementary question. As to the trade statistics, imports of machine tools in 1963 were £26·3 million. The estimate for 1964 is £35 million. Exports are about the same this year as they were last year, so the situation is very serious.

asked the Joint Under-Secretary of State for Education and Science, as representing the Minister of Technology, whether his department is to be represented at the International Congress on Human Relations in Melbourne in May, 1965.

The right honourable Gentleman has no information about this congress. He would be glad to have any information the hon. Member may have.

I am very disappointed to hear that the information has not reached the right hon. Gentleman. Would the Under-Secretary agree that this is an extremely important factor in any advance that there may be in automation and that it is therefore essential for his Department to be represented at international congresses of this type?

I quite agree that the subject is very important, but inquiries have been made fairly extensively, including at Australia House, and there was no information there at all.

asked the Joint Under-Secretary of State for Education and Science, as representing the Minister of Technology, what tests the Atomic Energy Authority has carried out to check the radioactivity of the waters around Holy Loch.

None, Sir. The Atomic Energy Authority has no responsibility for monitoring Holy Loch. This is a matter for my right hon. Friend the Minister of Defence.

While realising that this is not quite the answer that I expected, may I ask the hon. Gentleman, nevertheless, whether he realises that the Minister of Technology carried out a passionate campaign against the formation of this American base? Does the hon. Gentleman not think that it is high time that that Minister withdrew some of the statements he made now that he has joined the Government?

I thought that the hon. Member was seeking information.

asked the Joint Under-Secretary of State for Education and Science, as representing the Minister of Technology, what steps he is taking to provide employment opportunities, within the industries for which his Department is the sponsoring authority, for technicians who may be displaced from the British aircraft industry as the result of cancellation or reduction of the Concord and TSR2 projects.

It is not part of the Minister's responsibilities to provide employment opportunities in the way suggested. As the hon. Member knows, the future of the Concord and TSR2 projects is still under review.

Is the hon. Gentleman aware that this Answer will give very little comfort to large numbers of my constituents whose employment has been placed in jeopardy by the Government? Would he not agree that, in any case, we cannot possibly afford any substantial brain drain out of the British aircraft industry at this stage of our technological situation?

No, Sir, I am not so aware, and I hope not. The responsibility of my right hon. Friend the Minister of Labour is to look after a redundancy situation if that arises, as has been done under previous Ministries. This will be done, as in the past, if the occasion should arise. The question is theoretical.

Would not the hon. Gentleman agree that the TSR2 is a prime example of British technological achievement and skill and that the whole future of the British Aircraft Corporation is bound up with the future of this aircraft? Is it not high time also that we had a statement on the future of the Concord, which I understood we were to have before the House rose for. the Summer Recess—[HON. MEMBERS: "Oh."]— before the winter? How much longer are we to wait for this announcement?

I hope that the weather will be as the hon. Member hopes. As the hon. Member knows, a panel has been set up to look into this matter. As for unemployment, I hope the House knows that I am as interested to see that men are in work as anybody.

asked the Chancellor of the Exchequer by how much the salaries of the four paid Government advisers exceed or are less than the relevant Civil Service scales; and on what basis these salaries were negotiated.

I assume that the hon. Member is referring to the advisers mentioned in my hon. Friend the Financial Secretary's Reply to the hon. Member for Dorset, North (Sir Richard Glyn) on 10th November. The four advisers fill new posts for which previously there were no Civil Service scales. The salaries were determined in the light of the responsibilities of each of the posts would carry, account being taken of whether the adviser would work full-time or part-time.

Anyhow, have not events shown that a system of payment by results would have been more appropriate?

I thought the complaint was that we were getting too many results.

Can my right hon. Friend say what Ministers would have been paid if those who were responsible for the £800 million balance of-payments deficit had been so paid?

asked the Chancellor of the Exchequer if he has now decided whether to publish details of Government borrowing from overseas sources.

Not yet, Sir.

Can the right hon. Gentleman explain why it is taking so long to decide whether or not to carry on the practice of my right hon. Friend the Member for Barnet (Mr. Maudling) and virtually advocated by the present Prime Minister? Is there some doubt in the right hon. Gentleman's mind whether the Prime Minister is right on this subject?

I hope that there will be no doubt on either side of the House about the necessity of preserving the integrity of sterling. I hope that hon. and right hon. Members opposite will keep this in mind in their public and private utterances.

The Chancellor can rest assured that we on this side of the House are anxious to see the integrity of sterling preserved. If the right hon. Gentleman wants to launch an all-party appeal, will he on his side drop some of the Government's proposals, such as the nationalisation of iron and steel, which can do nothing for our economy and can only harm us in the eyes of people overseas?

That is exactly the sort of statement that is registered overseas and does a good deal of damage.

If the right hon. Gentleman says, as he rightly does, that certain information should not be made available, why do the right hon. Gentleman and his colleagues continue to blame us for not making that information public in the past?

I see where the right hon. Gentleman is getting to, but in view of his comments last week when I was in Paris I should have thought that a period of silence from him was called for.

asked the Chancellor of the Exchequer if he will introduce appropriate tax relief for those parents who relieve the pressure of numbers on the national educational system by sending their children to independent schools.

These parents qualify for child allowance subject to the ordinary conditions; and I cannot agree that there is sufficient ground for giving them extra tax relief.

Will the Financial Secretary not ask his right hon. Friend to look at this matter again? Would he not agree that it is in the country's interests that these parents should put the education of their children as a first charge on what are often very slender resources, and often at great sacrifice? Is not this an object which should be encouraged by the Government, and should they not be given some incentive and encouragement by way of tax relief?

I should be content to accept the argument of my hon. Friend the present Economic Secretary on 30th May, 1963, that this proposal would amount to a tax subsidy for independent schools for the benefit of those who choose to spend their money in this way on behalf of their children, and also the argument of my predecessor the former Financial Secretary that it would be contrary to the general rule that the Income Tax system of personal allowances cannot take into account in detail the various expenses that individual taxpayers incur.

Will my hon. and learned Friend bear in mind that many of us on this side of the House feel that it is wrong that people should be able to purchase education for their children which is superior to the general rule in the country and that we advocate a State system which will give equal opportunity to all children?

Yes, Sir. I am sure that my right hon. Friend will bear these considerations in mind. Matters of educational policy are, of course, for my right hon. Friend the Secretary of State for Education and Science.

In view of the remarks made by the hon. Member for Salford, West (Mr. Orme), will the hon. and learned Gentleman consider publishing in HANSARD a list of members of the Government who did not go to a State school and of hon. and right hon. Members opposite who do not intend to send their children there?

asked the Chancellor of the Exchequer what steps he is taking to accelerate the repayment of post-war credits.

My right hon. Friend cannot do so in present circumstances.

Will not the hon. and learned Gentleman say how soon this long-outstanding debt will be extinguished at the present rate of repayment?

Thirteen years.

I cannot say how long it will take, but the position is that over two-thirds of these credits have now been repaid. Over £500 million have been repaid and some £25 million have been set off against arrears of tax.

Can the Financial Secretary assure the House that the rate of repayment and the extension of categories for repayment will not be slower than it has been for the last thirteen years?

It certainly will not be slower. As the hon. Member knows, apart from various hardship cases entitling repayment, men can claim repayment at the age of 60 and women at the age of 55. By the natural processes of time, this will result in speedier repayment as the years go by.

asked the Chancellor of the Exchequer whether he will seek powers to enable registered disabled persons to claim relief from Income Tax on the insurance, taxation, maintenance and running expenses of their invalid vehicles.

I have noted the hon. Member's suggestion.

Will the hon. and learned Gentleman have a careful look at this between now and the time when the next Budget is introduced? Is he aware that there is a schoolmaster in my constituency who is crippled by polio and who must have considerable expenses over and above those of his able-bodied colleagues? Is the hon. and learned Gentleman aware that if this man were someone who required protective clothing he would be able to claim relief from Income Tax? Will he keep these considerations in mind?

Yes, Sir. I will certainly bear the hon. Member's suggestions in mind. The hon. Member has written to me about the case to which he has referred. Some of these disabled people qualify for an allowance from the Ministry of Health.

asked the Chancellor of the Exchequer what information he has on the effective percentage rates of taxation on profits levied by the Burmese Government on British companies in respect of their operations in Burma.

I understand that such profits are charged to Burmese tax on the slice system at rates that rise to 99 per cent. on the slice of profits exceeding 300,000 kyats (or £22,500).

Does the hon. and learned Gentleman agree that such excessive taxation really amounts to de facto expropriation without compensation? Does he further agree that if no firm action is taken to protect British investments abroad in this way, there is a real danger that other nations will be tempted to buy their way out of their economic difficulties by seizing British assets and offering unreasonable compensation?

As to the first part of that question, I agree. As to the second part, the way in which we can best assist companies and persons in Burma is by improving our relations with them, which is what we are seeking to do.

Is the Financial Secretary further aware that the position of British companies operating in countries like Burma with a high internal tax structure would be gravely affected by corporation tax?

I cannot see how they will be gravely affected if they are already paying tax at 99 per cent.

asked the Chancellor of the Exchequer what representations he has received from the Gilt-edged Security Holders' Association regarding his capital gains tax proposals; and what answers he has sent.

asked the Chancellor of the Exchequer what provision he intends to make to relieve from capital gains tax long-term holders of Government stock who are forced to sell at prices below their purchase price but above their value on Budget day, 1966.

I received from the Association of Gilt-edged Security Holders on 19th November a letter suggesting that holders of undated Government stock should be exempted from the provisions of the capital gains tax on the grounds that they should not be taxed when selling stock at a price above its 1965 Budget day valuation but below the original purchase price. A reply was sent on 3rd December explaining that I do not propose that the charge to capital gains tax arising on a sale after next Budget day should be on an amount greater than any gain that is realised. There will thus be no charge when there is in fact an overall loss. This point was again made clear in my Answer of 8th December.

Is the Chancellor in broad sympathy with the Gilt-edged Security Holders' Association? Does he realise the very real plight of many of the holders of this stock?

On this point, yes, but to go wider and talk about the general aims of the Gilt-edged Security Holders' Association would be outside the limits of the Question.

Whilst I am grateful for the Chancellor's reply, may I ask whether he realises the grave concern which exists generally about gilt-edged stocks? Will he make a further announcement now which would remove some of the anxiety and the clouds now hanging over these stocks?

Question No. 21 deals with that.

The question of the position of gilt-edged really is a serious one. Cannot the Chancellor do something to help in this matter? It would be very valuable if he could clear up this uncertainty about the position of gilt-edged securities.

Question No. 21.

asked the Chancellor of the Exchequer if, in view of the concern caused to holders of undated Government stock by his forecast proposals on the operation of a capital gains tax, he will exempt such stock from its operations.

asked the Chancellor of the Exchequer if he will make provision to avoid liability to tax on apparent capital gains arising from a fall in the purchasing power of the £ sterling.

asked the Chancellor of the Exchequer if he will exclude bloodstock from his proposed capital gains tax.

asked the Chancellor of the Exchequer what steps he proposes to take to exempt small family businesses from the effects of his proposed capital gains tax.

asked the Chancellor of the Exchequer what steps he is taking to allow for changes in the value of money in assessing capital gains for purposes of taxation; and whether he will suggest a suitable index to be used as a deflator.

asked the Chancellor of the Exchequer his plans for off-setting losses in his proposed capital gains tax; and whether capital losses made by reason of forced sales of Government stock will be balanced against other capital gains.

asked the Chancellor of the Exchequer why the capital gains tax will not be charged on betting and gambling gains.

asked the Chancellor of the Exchequer whether stamp collections will be assessable for capital gains tax; and whether parents will be liable to any capital gains achieved by their children in this field.

asked the Chancellor of the Exchequer what proposals he has to exempt owner-occupiers of land from the provisions of the proposed capital gains tax; and whether he will make a statement.

asked the Chancellor of the Exchequer if, when framing his proposed capital gains tax, he will consider exemption in cases where property has to be realised as the result of compulsory purchase orders.

In my Answer of 8th December, I stated that in reforming the taxation system I was ready to consider proposals that representative bodies might care to put forward. These are now reaching the Board of Inland Revenue and I am considering them in the course of formulating my detailed proposals. Meantime, I have nothing to add to the Answer I have already given.

In thanking the Chancellor for answering the Question, may I ask him to look carefully at this problem as many of the people concerned are elderly folk, particularly in my constituency, and they have enough problems already without adding the problems of a capital gains tax?

I do not think that the problem of undated Government stock concerns elderly people in view of the Answer which I have given to the hon. Member on the previous Question. It is a far different problem.

Would not the Chancellor agree, in regard to the first part of Question No. 51, that this is not something upon which he need spend any further thought? It is simply a question of saying that this will not be a capital tax but only a capital gains tax if it comes about. He must surely be in a position now to say that he will take into account the effect which changes in the value of money may have on assets. Therefore, he should now be able to assure the House that he will use some deflator to ensure that the change in the value of money is taken into account. Otherwise, the tax merely becomes a charter for inflation.

Despite the tempting nature of that question, I cannot answer it now. It would be introducing a wide and new principle in the whole of our taxation system.

Can the right hon. Gentleman say when he will be in a position to make a much fuller statement than the one he made on 8th December?

I shall certainly do so when the legislation is introduced into the House next year.

When the Chancellor is considering the matter, will he bear in mind that it would be anomalous if gains on gilt-edged stock were taxable but gains on gambling were not?

I follow the point made by the right hon. Gentleman. By definition, a capital gain arises when an asset is disposed of. A football pool winning does not require the disposal of an asset.

In connection with Question No. 62, will the Chancellor realise the dilemma in which he is placing owner-occupiers of land, who are faced with the problem of whether they should value their holdings today as against a possible sale in the long-term future? The position is difficult both technically and financially. Will the right hon. Gentleman make a statement as soon as he possibly can?

A number of difficulties are being made which do not exist. The proposal for a capital gains tax was clearly included in the manifesto on which we fought the election. Everybody has known ever since the manifesto was published that there would be a capital gains tax. I have tried to meet the convenience mostly of hon. Members opposite by making a lengthy statement about the general structure of the tax and I do not think that it would be in the public interest to go further at present.

Reverting to the question of the gilt-edged market, the right hon. Gentleman said that he was considering representations. Surely, he does not need any representations from anybody to realise the state of the gilt-edged market. Cannot he do something to clear up this important and urgent point?

I cannot add to the answer which I have already given.

Question No. 44, which the Chancellor has also answered, is rather wider. In view of the fact that we are all quite clear that the purchasing value of the £ will drop during the term of office of the present Government, will he give an assurance that at least he will make provision to allow for this in his capital gains tax? I am not asking him to give exact details, but will he give an assurance that he will make allowance for this?

I seem to remember that in the last thirteen years, when I sat on the benches opposite, substantial capital gains were coupled with a dramatic fall in the value of the £.

Does the Chancellor appreciate the intolerable burden that these uncertainties are placing upon trustees who have the responsibility for acting in the best interests of the beneficiaries of various trusts? Will he bear this very much in mind when considering whether he cannot bring forward a statement to remove these uncertainties on the gilt-edged position?

I do not think that there are uncertainties in this field—[Interruption.]—which are not inherent in a change of this nature in the taxation system in order to make our tax system more fair. Naturally, in a transitional period, there is bound to be a certain amount of uncertainty, but at least I hope now to introduce a system with the support of the House that will ensure that capital gains are taxed just as much as earnings of a wage earner.

Would not my right hon. Friend agree that there is no more uncertainty than exists from year to year between one Budget and the next if Chancellors of the Exchequer introduce changes in taxation? May I ask my right hon. Friend to do nothing to weaken the effect of this vary much overdue capital gains tax?

indicated assent.

asked the Chancellor of the Exchequer (1) to what extent he is satisfied with the variety, scope and frequency of the present routine trade and payments statistics; and what steps he proposes to take to improve them.

As regards the balance of payments, the series of quarterly and annual figures is under continuous review and further improvements will be made, notably in the measurement of certain payments and receipts for services in the invisibles account and of international trade credit, as more information becomes available. The "balancing item" represents the net total of errors and omissions throughout the accounts, but it is not feasible to say precisely to what extent the various components of the accounts have contributed to this item.

Could the hon. and learned Gentleman tell us whether in future the statistical limits of error will always be prominently attached to the official trade and payments figures to which they refer so that the public will not be misled by attributing to them a degree of accuracy which they do not and simply cannot hold?

The hon. Member will appreciate that it is not possible, as I have said, to apportion the balancing items between the particular components.

It is not entirely a matter of balancing items. Cannot the hon. and learned Gentleman give us some computation of the statistical limits of error? For example, take 1960–61; that was a year in which the final balance that year differed from the original estimate—I believe by more than £100 million.

The right hon. Member should know. I think that in general the assessment of the reliability of the various components of the balance of payments accounts is given on pages 37–39 of the United Kingdom Balance of Payments 1964, which is published by the Stationery Office, but it would be unrealistic to try to assess the range of error in quantitative terms for various components.

Would the hon. and learned Gentleman not agree that during the year there has been an increase of something like £300 million in aid grants and credit guarantees, which have put a totally different complexion on the case the Government are making?

With respect, Mr. Speaker, that is an entirely different question.

Would not the hon. and learned Gentleman agree with this side of the House—it is generally agreed—that better statistics are an advantage? In this connection would right hon. Gentlemen opposite cease making speeches in which they muddle capital investment overseas with our trading balance, which is a totally different thing, because this would seem to be seeking to deceive the public in this country but particularly people overseas who do not realise that right hon. Gentlemen opposite are making political points and not fair points?

asked the Chancellor of the Exchequer what consideration he has given to moving some adjuncts of Government Departments to Northern Ireland.

In selecting locations for Government establishments which are being moved we shall, as far as practicable, give special consideration to the claims of areas, including Northern Ireland, which need additional employment.

Will the hon. and learned Gentleman have consultations with the Minister of Technology and other appropriate Ministers with a view to seeing whether he can put more research establishments in Northern Ireland on the lines of the successful linen research department already there?

Yes, I will certainly bring that suggestion to my right hon. Friend's attention. It is, perhaps, establishments of that kind which it might be possible to locate in Northern Ireland.

Will the hon. and learned Gentleman bear in mind the suggestions already made to the Treasury by the Ulster Members on this matter?

Yes, certainly. Those representations have already been drawn to my attention.

asked the Chancellor of the Exchequer whether the 15 per cent. import surcharge applies to imported nursery stock; and what proposals he has for alleviating the hardship caused to nurserymen and seedsmen.

Yes, but I do not expect this to cause any serious hardship to nurserymen and seedsmen.

Does the hon. and learned Gentleman realise that that answer will be received with incredulity by those who are involved? Quite plainly, the hon. and learned Gentleman has grown roses in anger in his life or he would never make a reply like that. But does he realise what he is taxing by this surcharge the raw material by which these people make their living, and will he apply himself accordingly?

I thought that rose growers grew their roses in love and not in anger. However, this charge represents less than 1d. on rose plants selling at more than 3s.

asked the Chancellor of the Exchequer if he will indicate the likely effect of the Government's recent economic measures, in particular the tax increases and Bank Rate measures, on the Scottish economy.

We cannot have a healthy economy in any part of the United Kingdom unless we first strike a balance between our overseas payments and receipts. That is the purpose of the Government's recent measures. In working them out, particular attention is being paid to fostering the development of areas like Scotland.

While appreciating what the right hon. Gentleman has said, may I ask whether he will agree that Scotland has never before had to suffer at any one time such a wide range of penal monetary and fiscal measures, and that Bank Rate alone between now and May will mean an extra £180,000? Is he further aware that prominent members of the present Government have called from time to time in past years for the exemption of Scotland from this kind of proposal? What steps are they going to take to implement those promises?

I am afraid that the hon. Gentleman's premise is quite wrong on this occasion Scotland and other development areas are being singled out to ensure that they do not suffer from the effects of the Government's measures.

How?

asked the Prime Minister what representations he has received on the subject of Government action with regard to closure of the Whitby railway lines; and what replies he has sent.

I have had representations from the Whitby Urban and Rural District Councils, three local associations, and four individuals, asking me to stop or postpone the closure of these services. The position as set out in my right hon. Friend the Minister of Transport's statement on 4th November has been explained to them.

May I remind the Prime Minister that on 15th September he wrote to the Chairman of the Scarborough and Whitby Labour Party a personal letter, which was much publicised during the election, and in which he said,

"I confirm that obviously a major decision such as the proposed Scarborough-MaltonWhitby closures would he covered by the statement in the Labour Party Manifesto that the new regional authorities will"—

Order. Reading.

Yes, I am reading the Prime Minister's letter.

Verbatim quotation of that kind is out of order on a Question. Perhaps the hon. Member will summarise its effect.

The Prime Minister wrote a personal letter on 15th September stating that these railway closures would be halted pending the new regional authority's report. My constituents expect him to fulfil that pledge.

Yes, Sir, of course, the position was that when this Government took over the decision had by that time been taken by the then Minister. Under the terms of the 1962 Act we could not halt the closure which had already been decided. I do feel that an explanation is called for to those concerned, and I think the hon. Gentleman should now inform Scarborough and Whitby and all stations between that he voted for the 1962 Act.

The Prime Minister must have known that when he made that pledge.

Answer.

Is my right hon. Friend aware that in a debate on the cost of living the hon. Member expressed himself on 20th July—it can be found in HANSARD of that date in column 105—as totally opposed to public subsidies to bolster up private enterprise and yet now he is protesting about these closures even though he knows that to keep the lines open they will need to be bolstered up by what is in effect a subsidy?

asked the Prime Minister if he will make a further statement on the constitutional position of Southern Rhodesia.

The constitutional position of Southern Rhodesia was set out by my right hon. Friend the Commonwealth Secretary in a written reply to my hon. and learned Friend the Member for Aberdeen, North (Mr. Hector Hughes) on 17th November.

Would the Prime Minister confirm that the British Government recognise and will adhere to the convention by which they do not legislate for Rhodesia except at the request of the Rhodesian Government?

I think the whole question of the convention and the security issues were very excellently expressed in the Commonwealth Prime Ministers' communiqué signed by the right hon. Gentleman opposite. We fully adhere to it.

Is my right hon. Friend aware of the recent protest given to the High Commissioner by the African nationals in regard to the recruitment of both Africans and German recruits into the Rhodesian Air Force, in the light of the recent dismissal of the commander-in-chief? Would my right hon. Friend care to make a statement?

I am aware of that protest, but I do not think there is anything I could say helpfully about that particular protest at this stage. I am, however, on the general question on which I have previously reported to the House, in further communication with the Prime Minister of Southern Rhodesia, and, indeed, sent him a message today.

Is the Prime Minister aware that what is necessary in Rhodesia is not only that Europeans should be prepared to act properly according to a constitution but that the African nationalist extremists should also be so prepared? I asked his right hon. Friend the Commonwealth Secretary about this recently. Would not the Prime Minister agree that it is time the Government made some noises about the Africans and what they should do if they are to show that they are worthy of fighting constitutionally rather than resorting to violence and intimidation?

I am not sure what noises the hon. Gentleman wants to hear. We have reiterated the statement made by the Commonwealth Prime Ministers in their communiqué, and by this we stand.

asked the Prime Minister if he will publish the report which he has now received from the Minister of Labour into the political motivation of strikes at election times, together with minutes of the evidence taken.

asked the Prime Minister if he will now take steps to establish permanent machinery for the investigation of political motivation behind any future industrial dispute.

No, Sir. I have already informed the House of the results of my right hon. Friend's examination. No evidence was taken outside his Department and no other kind of permanent machinery is required.

Would not the Prime Minister agree that this House is a very fair place? If he were prepared to withdraw the allegation that he made instead of trying to justify it, this question could now be dropped.

If I thought that there was anything to withdraw I would, but I have explained several times to the House my reasons for thinking there was something suspicious going on and calling for an inquiry. I was not wrong in saying that there was something suspicious going on. What no one could foresee, and what shocked the right hon. Member for Sutton Coldfield (Mr. Geoffrey Lloyd) in a recent Question, was that within 24 hours we would get very clearly what was the reason for this dispute in a statement which I do not think anyone would have expected he would be likely to hear, and that is now the explanation.

Is the Prime Minister aware that the slow progress in this matter suggests a lack of dynamism? Will he take energetic action to allay public suspicion that many strikes are due to conscious and purposive Socialist planning?

asked the Prime Minister whether he will recommend the award of a campaign medal for the military personnel involved in the Aden operations.

The award of a General Service Medal in recognition of certain specified operational service is under consideration.

Does the Prime Minister realise that a slight variation in the ribbon design of the ordinary General Service Medal has been agreed for the Borneo and Aden operations? However, the medal to go with the ribbon has not yet been decided. Can the Prime Minister give an assurance that it will not be the ordinary General Service Medal, but will be appropriate to these two campaigns?

As I have said, this matter is under consideration and there are certain technical points which have to be discussed with Middle East Command.

asked the Prime Minister whether it remains the policy of Her Majesty's Government not to support any expansion of the war in South Vietnam into North Vietnam.

Her Majesty's Government's attitude to the situation in South Vietnam was explained in the Foreign Affairs debate last week. The assurance asked for by my hon. Friend relates to an entirely hypothetical situation.

Does my right hon. Friend recall that on 5th March of this year he urged the then Prime Minister, the present Leader of the Opposition, to make it clear that he was advising President Johnson against those who were proposing an invasion of North Vietnam as a way of aiding the situation in South Vietnam, and on 30th June of this year he again addressed the present Leader of the Opposition and asked him to make it quite clear—[HON. MEMBERS: "Reading."] I am quoting from the Question—that we would not support any extension of the war into North Vietnam? Will he please make it clear that the Government's position is still that stated by him in those Questions?

I think that those were very wise words, but the right hon. Gentleman, when speaking from this Box, said that he had not been asked to agree to extend the war to North Vietnam, and that is my position today.

asked the Prime Minister what Departments are to be responsible for the advancement of technology in the building industry; and what is the extent of their separate responsibilities.

The primary responsibility for the building industry rests with my right hon. Friend the Minister of Public Building and Works. He acts in close consultation with the other Ministers concerned, including the Minister of Technology who has the task of promoting industrial advance in industry generally and will be responsible for the Building Research Station.

Does not there seem to be a proliferation of Ministries for Technology and Science which overlap each other in this, and are not there a large number of other Departments concerned in this? Does not the Prime Minister feel that the extra Ministries have not simplified, but have made things very complicated?

If the hon. Gentleman thinks that this is a proliferation, I can only tell him that this is a continuation of the system we inherited, though I think that this is justified because on that occasion the Minister for Education and Science was responsible for the Building Research Station. Those duties have now been taken over by the Minister of Technology. We went very carefully into the question of whether this particular research station should be transferred to the Department which is responsible for the industry concerned, namely, the Ministry of Works, but we decided to adhere to the system which had previously been followed, that it should be the responsibility of the technological Ministry and not of the production department.

Whichever Department looks into this matter, will the Prime Minister be good enough to have an investigation into the cause of the new house price index rising over the last eight years from 96 to 144? What is the cause of this, and what can be done to help it?

I think that everyone who studies this will agree that one of the main items in this is the rising price of land. This is not a problem which can be solved by technology, but only by legislation. Rising costs are a matter of concern to everyone, and this is a matter which I know my right hon. Friend the Minister of Works is discussing with both sides of industry, not only nationally, but on his tour of particular regions.

asked the Prime Minister what discussions he had with the President of the United States of America on matters relating to shipping which were in controversy; and whether unanimity resulted.

As regards the Washington talks, it would not be right for me to go beyond the scope of the joint communiqué but we hope that the progress achieved through the Organisation for Economic Co-operation and Development last week in resolving differences with the United States authorities on shipping policy will be maintained.

May I ask, because it really was not quite clear from the communiqué, whether it was the Prime Minister's conversation with President Johnson which produced the communiqué, or whether it arose out of ordinary trade and commercial considerations and decisions? Would I be right in assuming that the decisions had been taken before he had his conversation, if he had one, with President Johnson?

It is not usual to go into detail in talks with the President of the United States and similar talks, but I think I can say that our position in this matter is exactly the same as that of the previous Government with regard to shipping, and I think that the position of the Government is fully understood in the United States. I am not claiming that any talks in Washington this month have led to the improved situation at O.E.C.D., though I join the hon. Lady in hoping that that progress will be maintained.

Will my right hon. Friend bear in mind that there are some outstanding bilateral problems relating to shipping which call for some further consideration? Although there has been some easement of some of the problems which exist, would not it be a wise move if one of his right hon. Friends, perhaps the President of the Board of Trade or the Minister for Economic Affairs, took the opportunity of having discussions to remove some of the difficulties of a bilateral character which exists?

I agree with my right hon. Friend that there are some big outstanding questions, and I was not trying to suggest that what happened at O.E.C.D. was more than a step in the right direction, but I am satisfied that the United States Government know of our position on this, and if anything further is needed to bring the problem to their attention we shall not hesitate to take whatever steps are necessary.

asked the Prime Minister if her Maestys' Government will recognise the competence of the European Commission on Human Rights to receive petitions within the terms of Article 25 of the Convention for the Protection of Human Rights and Fundamental Freedoms; and if it will declare, pursuant to Article 46 of the Convention for the Protection of Human Rights and Fundamental Freedoms, that it recognises as compulsory, ipso facto and without special agreement, the jurisdiction of the European Court of Human Rights on all matters concerning the interpretation and application of the Convention.

Her Majesty's Government are at present looking into the whole matter.