asked the Secretary of State for Social Services what has been the percentage increase in prescription charges since May 1979.

asked the Secretary of State for Social Services by what method he intends to determine the revision of prescription charges.

asked the Secretary of State for Social Services whether he plans to revise prescription charges.

Prescription charges will be increased annually in line with costs. This is a sensible way of running things as compared with the fits and starts of the previous Government. The prescription charge in May 1979 was 20p, as set in April 1971, when it was 27 per cent. of the average cost per item. It is now £1, 31 per cent. of the average cost per item.

Is the Minister aware that he has given a peculiarly disingenuous answer? How does he square an astronomic increase of 500 per cent. with his description of a challenge by the Labour Party at the last general election to the effect that these charges would increase as a Labour lie? Does this not show that the whole prospectus put before the electorate by his party was completely bogus?

"This is an increase in charge which is an adjustment of charge to cost"—[Official Report, 21 July 1969; Vol. 787, c. 1393.]

rose——

Order. I propose to call first those hon. Members whose questions are being answered.

Is the Department still adhering to what is no more than a rule of thumb method of charging the patient one-third of the total cost of medication through prescription charges? If so, is it the Government's intention to raise the prescription charge to £1·30 in the autumn?

I have already said that the charges will be increased annually in line with costs. The present average cost of a prescription is £3·22. The sum of £1 seems a reasonable contribution towards this amount.

Does the Minister agree that, in view of the positive campaign to persuade doctors to prescribe cheaper drugs, the cost of a substantial percentage of drugs has fallen well below the £1 prescription charge? Does, he further agree that this has led to many chemists not submitting prescriptions for payment?

It is too early to see the effects of the recent increases. The total number of prescriptions has fallen. In 1979 the figure was 304·6 million. It is now 303·3 million. I would have thought that the Labour Party, which first introduced and later reintroduced charges, would have been pleased to see this development. It shows a wiser use of money.

With all these percentages flying around, will the Minister say what percentage of the total population does not pay prescription charges and how this compares with 1979?

Thirty-five per cent. do not pay prescription charges. Sixty-five per cent. have exemptions and another 5 per cent., making 70 per cent., use season tickets, and I am pleased to say that the use of these has increased considerably.

Does the Minister agree that he invokes a new principle in tying a charge to the rate of inflation? Will he give an assurance that no other Health Service charges will be linked to the rate of inflation?

No. do not think that the hon. Gentleman is looking at the matter correctly. We are tying the prescription charge to the actual cost of drugs which are dispensed.

As the Government, or, in other words, the taxpayers, are contributing, in real terms, a massive £150 million more to health and social services than did the Labour Government, is it not reasonable that those who can afford to pay prescription charges should do just that?

Yes, it is reasonable. We have increased the overall amount of money available. Drugs are costing about £1,000 million a year. I should have thought that the majority of people would be pleased to contribute to such costs.

Now that the Minister has admitted that the Government have increased prescription charges by 400 per cent., will he explain why the Government chose to increase this charge by a larger percentage than any other charge, licence, tax or Excise duty?

I do not accept that. We are adjusting the costs in direct proportion to the amount of money being spent on drugs. I believe that to be reasonable

asked the Secretary of State for Social Services whether he has yet received the urgent report which he requested on why the manufacture of pharmaceuticals has not ceased at eight hospitals in England.

Yes, Sir. It shows that seven of the eight hospitals have now ceased manufacture completely. The other one is continuing at a much reduced level.

May we have an assurance that the hospital which is continuing to manufacture at a reduced level will be monitored? Why is that hospital being allowed to continue to manufacture? How will the Secretary of State ensure that the other seven hospitals really cease to manufacture? What plans has he to monitor them?

The hospital which is continuing to manufacture is King's College hospital. It is making a small range of terminally sterilised products which are not available commercially. The hospital has been inspected again quite recently. The inspector is satisfied that the reduced level of manufacture involves no present danger to patients, having regard to the quality and dedication of the staff in the pharmacy department. We shall keep an eye on the other hospitals. The hospitals to which the original instructions went have ceased to manufacture in accordance with the inspector's recommendation.

What steps will the Secretary of State take to ensure that in future health authorities take action without delay on recommendations from the Medicines Inspectorate?

Now that the matter has been brought to the attention of health authorities, I should be surprised if any health authority ignored a recommendation from the inspectorate. In addition, when we have developed, as we now nearly have, a new system of costing so that proper comparisons can be made of costs of manufacture in hospitals and costs of buying in, I shall expect all health authorities to examine carefully the comparative economics. I should expect them to buy in from outside whenever that is economical.

asked the Secretary of State for Social Services what is the current value of the standard rate of unemployment and sickness benefits, expressed as a percentage of average industrial earnings; and how this percentage figure compares with the figure in March 1979.

The standard rate of unemployment and sickness benefit is 25·2 per cent. of the estimated average net earnings of full-time adult male manual workers in January 1981, the latest date for which figures are available; the comparable figure in March 1979 was 25·6 per cent.

Is the Minister aware that the situation will become much worse when the earnings-related supplement is abolished? What will he do to counteract that appalling decision?

It is, of course, appreciated that when the earnings-related supplement is abolished, on average there will be a difference of about £9 a week for those who have been receiving it. However, for those who would suffer hardship, the supplementary benefit safety net is always available.

As there is a growing reluctance among some young people to stay on at school or in further education generally or to go on to the work experience scheme because of the relatively high level for young people of supplementary benefit and unemployment pay, will my hon. Friend look into the situation with view, perhaps, to reducing supplementary benefit and unemployment pay for young people and increasing the amount of money available to those on the work experience scheme on a nil-zero sum basis?

The whole question of young people is being examined by the Secretary of State for Employment.

Does the Minister intend to maintain the ratio between unemployment and sickness benefits and average earnings? If he does not, why not?

That matter is also being examined.

asked the Secretary of State for Social Services whether he is satisfied that regional health authorities consult fully with the trade unions concerned before making firm proposals for the creation of new district health authorities.

Yes, Sir.

Does the Secretary of State accept that there is genuine concern in the trade unions about the implications for employment of the new district health authorities? Will he guarantee that the trade unions will be fully involved in the discussions leading to their establishment?

The trade unions were among the bodies consulted by the regions on the proposed new structure of district health authorities. I am fully satisfied about that. Of course the unions will be consulted again about the drawing up of orders transferring employment from the existing authorities to the new district health authorities. I make that absolutely clear.

Is my hon. Friend aware that the deafness of the Wessex regional health authority to the consultation process has been answered by the patience, understanding and common sense of the Minister for Health with his intervention concerning the Grove? Will my right hon. Friend take this opportunity to join me and every body locally, including general practitioners, in thanking the Minister for what has happened? Will he ensure that the new district health authorities referred to in the question are more responsive to local opinion on medical matters than was the case in that instance?

I am glowing in the blushes of the Minister for Health. I thank my hon. Friend for his tribute to him. One of the central purposes of the reorganisation in which we are currently engaged is to have smaller, more local, authorities which will be more responsive to local opinion about local health services. That primarily is what we are out to achieve. I hope that my hon. Friend believes that we are setting about it in the right way.

As we have had the enunciation of a new theory this afternoon, namely, that in future patients will be charged in relation to cost, irrespective of whether they need expensive drugs, will the Secretary of State follow that theory all the way along the line? Will he provide the amount needed for reorganisation in line with inflation? The unions would be happy to learn that their wages are to be increased in exactly the same way.

I assure the hon. Lady that this Government have no intention of following the example of their predecessors, who preferred to cut capital spending by two-thirds rather than put up prescription charges. We have done the opposite.

asked the Secretary of State for Social Services to what level the death grant would have to be raised to preserve its real value as at 1 April 1970.

Based on the movement of the General Index of Retail Prices up to February 1981, the latest month for which a figure is available, the standard £30 grant would need to be increased to about £115 to restore the value that it had in April 1970.

Does the Minister realise that the cost of medical certification required for cremation is now about the same as, and in certain circumstances exceeds, the value of the death grant? Bearing that in mind, and noting the enormous anxiety felt by elderly people as they watch the value of their pensions and savings diminish and the cost of funerals mount, will the Government reconsider the matter urgently?

The cost of cremation certificates is being reconsidered along with other matters related to the death grant. I remind the hon. Gentleman that pensioners received a 19½ per cent. increase in November 1979 and a 16½ per cent. increase last November. Many pensioners are not making the type of noises that we hear so often from the Opposition.

As the Secretary of State has told the House that 27 per cent. of the cost seems a reasonable proportion, will he take that on board when he considers the death grant?

Hon. Members know that the whole of the death grant is being fully reviewed. When that review is completed we can come to the House with a statement. In the meantime, I do not believe that the hon. Gentleman's suggestion is necessarily the right answer to the problem.

Is any consideration being given under that review to increasing the death grant to the £115 to which my hon. Friend referred, but paying it only where the next of kin of the deceased is in receipt of social security benefits?

That, and many other suggestions, have been made to the Government. They are all being considered.

Is the Minister aware that 1 million people signed a petition and made noises about the issue because they felt so strongly about it? Will the Minister refute the suggestion by the right hon. Member for Daventry (Mr. Prentice) that the Government are considering abolishing the death grant? Is she aware that that would be a slap in the face for those 1 million people?

I am well aware of the Dignity in Death Alliance deputation and of the million signatures on the petition. It would cost over £86 million to extend the death grant to everyone. However, I can add nothing further, until we have reached a final conclusion on the death grant.

asked the Secretary of State for Social Services what recent representations he has received from regional health authorities regarding their financial allocations for 1981–82.

None, Sir.

Is the Secretary of State aware that of the 1·4 per cent. gross level increase in allocation at least half will be taken up by population change demands? With cash limits set for inflation at 11 per cent. and wage increases at 6 per cent., is that not wishful thinking, bearing in mind the effects of the Budget?

The proposed spending in 1981–82 on the National Health Service follows exactly the projections that were established by our predecessors in their last public expenditure White Paper—that is in real terms, making allowance for the rate of inflation. Although the average for the country as a whole of allocations to health authorities is about 1·6 per cent., the allocation to the Northern region is 2·3 per cent., representing a growth that is nearly five times higher than the growth, for instance, in the Thames region, which serves London and the Home Counties.

Do those allocations take account of the Secretary of State's recent proposal to charge people from abroad for the use of NHS services? If not, when does he intend to take note of that allocation?

I pay tribute to my hon. Friend for the pressure that he has maintained to ensure the introduction of that scheme. The money that will be earned in that way by the health authorities will be additional to the money that is allocated to them by the Government.

Will the Secretary of State explain how he can make a sensible decision about the allocation of money to regional health authorities when, according to the answers that he has given to parliamentary questions, he does not know the precise financial circumstances of the area health authorities in the previous year?

As the hon. Gentleman knows, the allocations are made according to the formula evolved by the resource allocation working party, known as the RAWP formula. That formula has recently been revised and refined, and now provides a good basis on which to allocate money to different parts of the country on the basis of need. In the final analysis, of course, a judgment is required; it cannot be an automatic process. However, in forming that judgment, Ministers base their assessments on a wide range of factors, and the results are the figures that were published earlier this year.

I appreciate the detailed response that my right hon. Friend gave to the original question. Will he say what representations he has received from regional health authorities about the need to increase the number of consultants in the regions to provide a more adequate service for patients? What was his response to the regional health authorities that made such representations?

There are two sides to my hon. Friend's question. First, health authorities are never slow to say that they could spend more money than they receive. The other concerns the matter which the Select Committee—of which my hon. Friend is a distinguished member—is considering, namely, the balance between consultants and training grade doctors. We await with interest the findings of the Select Committee. I know that the NHS would like to have a better balance between the two grades of doctor.

Will the Secretary of State clarify the figures? Is it not true that the increase of 1·6 per cent. includes the savings of £25 million which he imposed on health authorities? Is it not true that the £25 million is really £35 million at actual prices? Is not the Secretary of State counting minuses as pluses?

With respect, the 1·6 per cent. is after taking account of the savings, which were £25 million at survey prices, and are likely to be between £35 million and £36 million at outturn prices this year. Bearing in mind that that relates to a programme involving a total spending of more than £10,000 million, it is surely reasonable to expect the Health Service authorities to be able to find savings through higher efficiency that will amount to that small proportion of their total spending. That is what I seek, and that is what the regional health authorities have taken on board. I am quite confident that they will be able to achieve that saving.

asked the Secretary of State for Social Services what discussions he has had with the Church of England and the Salvation Army concerning their help for the disadvantaged.

Neither has requested a discussion, but I am always willing to consider those aspects of their work which fall within the Department's responsibilities and for which I have great admiration. Officials have been in touch with the Church of England Children's Society, the Church Army and the Salvation Army on specific projects.

Is the Minister aware that both the Church of England and the Salvation Army recently joined forces to condemn the Government's policy of major cuts in support for hostel housing accommodation for single homeless people? Is he aware of their concern that his Department and the Department of the Environment are sharply reversing the policy of his predecessor which was to seek closure of the massive, out-of-date and disgracefully inadequate single person hostels provided by his Department by means of increased provision at local authority and housing association level to such organisations? What does he intend to do about that?

I have seen the joint statement to which the right hon. Gentleman referred, and it is not in the strident tone he attributes to it. The Department of the Environment has made available £12 million as a special allocation for hostels. Both the organisations that he mentioned are eligible to apply to the DOE for grants. On the issue of size, I sympathise with the view that large institutions do not provide the right environment for people who are homeless, many of whom would prefer smaller institutions or homes where there is an opportunity for them to have an independent identity and where there is some privacy. I welcome any move to develop alternative provision to replace such outdated institutions.

Is the Minister aware that the meeting chaired by the Archbishop of Canterbury to launch the joint appeal by the Church Army and Salvation Army for their hostels, far from condemning the Government's action, paid particular tribute to the Minister for Housing and Construction for the help that he had given to hostels?

My hon. Friend has confirmed what I said earlier, that the joint statement was not couched in the tones attributed to it by the right hon. Gentleman.

asked the Secretary of State for Social Services if he can now make a statement on the future system of child benefit payments.

asked the Secretary of State for Social Services when he now expects to announce his decision upon the arrangements for paying child benefit weekly or monthly.

I am still considering the comments received on the Government's proposals in Cmnd. 8106, and I hope to announce the Government's decision on all the proposals shortly after the Easter Recess.

Will the Secretary of State confirm that it will no longer be possible to make a statement before Easter? Will there be a gap between any Government decision to change the system and the introduction of that change? If the Government go ahead with the four-week proposal, will he assure the House and the mothers of this country that the £50 million saved by the cash flow effects on his Department will be put to increased child benefits?

At this stage I do not want to commit myself to a precise time, because clearly that would depend on what changes, if any, we propose. Any effect on total public expenditure occasioned by less frequent payments of child benefit—the hon. Gentleman rightly used the term "cash flow"—will affect the cash flow in moving expenditure from this year to next. The resulting reduction in public expenditure this year is a reduction which the Chancellor must have if he is to meet his Budget targets.

Does not the Secretary of State accept that the most important people to consult are the mothers who draw the benefit? Would it not be better to guarantee that any mother who wanted to draw her benefit weekly could continue to do so, even if the Government wished to persuade some people to change to a monthly system?

We have received representations about the White Paper from 550 individuals, organisations and local authorities, many of them representing mothers and particularly mothers in need. I am of course aware that strong views have been expressed to the effect that weekly payment of child benefit should be retained for those who want it. I assure the hon. Gentleman that I am taking those representations seriously, and we hope to announce our decision after Easter.

Does my right hon. Friend agree that the level of child benefit is the most important factor? Does he accept that, although the increase was good, we expect even more? If the survey shows that the majority of mothers wish to draw child benefit four-weekly, does he accept that allowing for the choice will probably achieve most of what the Government are after?

I am grateful for my hon. Friend's initial remarks. The Opposition's wish to have it both ways is puzzling. They must decide whether the amount of child benefit is reasonable and should be received regularly or is insignificant, in which case why should it not be paid less frequently? The Government are considering my hon. Friend's second point.

Does the Secretary of State accept that, despite the recent increases, child benefit is 40 per cent. a week lower in real terms than when his Government came to office? Should not his most urgent priority be to bring it back to that level?

I cannot confirm the right hon. Gentleman's figures. The increase announced in the Budget will maintain child benefit at last November's level, in accordance with the undertaking that I gave to the House.

Does my right hon. Friend agree that child benefit is more valuable to people on higher rather than lower incomes because it is tax-free? Has he considered making it taxable? If it was, what would the yield be?

Child benefit replaced child tax allowances, which had the same impact.

More so.

Indeed. Child benefit is in a sense a child tax credit and is a tax-free sum paid to mothers, whatever their income. I have doubts about any recommendation to make the benefit means-tested. It would be strange to bring a benefit that has replaced tax allowances into taxation.

asked the Secretary of State for Social Services if he will estimate how much illnesses related to smoking and to alcohol abuse cost the National Health Service in the last year for which figures are available.

Estimates by the Department suggest that the annual cost to the NHS in England and Wales of smoking-related diseases is about £115 million and of alcohol-related diseases between £50 million and £69 million, both at November 1979 prices. These figures of course exclude the other costs which these illnesses inflict on society.

What must be the cost to the NHS before my hon. Friend will consider imposing a direct charge on patients who bring such illnesses on themselves?

At first sight, my hon. Friend's suggestion has the advantage of equity and logic, but there are difficulties. How does one prove causality in a man with high blood pressure who drinks and smokes? How does one prove that the bad habit is the main cause of the illness and not merely contributory? There are also philosophical problems. Which bad habits does my hon. Friend suggest we should select? What about accidents in the home, or glue sniffing? What about dangerous habits such as pot-holing, or even bicycling? With all the problems, we have no plans to introduce new charges.

With the ever-increasing number of alcoholics, and the apparent increase in under-age drinking, will the hon. Gentleman follow the example of one of his predecessors in banning cigarette advertising and ban advertisements for alcoholic beverages?

No. Smoking and drinking are different. The vast majority who drink do so in moderation and do not harm themselves. Regrettably, the same is not true of smokers.

In view of the cost to the NHS of smoking and drinking, does my hon. Friend agree that it is nonsense to include the cost of smoking and drinking in the RPI?

I should welcome the opportunity to give my views to the House, but I have no ministerial responsibility for the matter.

As official statistics show that the Government are driving more and more people to drink, has the Department estimated the deterrent effect of the swingeing tobacco and alcohol price increases in the Budget?

The estimates are, of necessity, speculative. Initial estimates indicate a possible reduction of about 8 per cent. in the sale of tobacco. I have no figures on the possible impact of the increase on the consumption of alcohol, but I believe that it will maintain the relative price of alcohol to other goods and services. One cannot make a case for alcohol becoming relatively cheaper.

asked the Secretary of State for Social Services what payment to the National Health Service he expects from the sale of the St. George's hospital site.

No figure can be given at present.

Is the Minister aware that many Londoners believe that publicly owned land should be retained for public usage, and that if the land is sold for a song because of Government policy there will be a public outcry? Therefore, when it is sold for its proper value, which must be fabulous, will the hon. Gentleman ensure that the money is spent on providing better equipment for our under-equipped hospitals?

We understand the point, but we have made it clear that there is no further NHS requirement for the site. It is of advantage to the Health Service to raise as much money as possible from our part of the site, which could be used to the benefit of health care.

Why do the Minister's commercial instincts work only one way? Why cannot the NHS benefit economically from the sale of the site? Does the hon. Gentleman agree that it is a disgrace that Grosvenor Estates will walk away with an enormous profit and the taxpayer will gain no benefit?

The hon. Lady has no grounds for saying that. Only a small section of the site belongs to the NHS.

If a hospital, some of the cost of which was raised by the community, is sold, what proportion of the revenue of the sale will be returned to the community, and to whom will it go?

I should be glad to give the hon. Gentleman a detailed answer in writing. It is our general view that regional, area and local community health authorities should benefit as locally as possible. As much money as possible should go back to the local health service.

asked the Secretary of State for Social Services on what basis the revenue allocation to the Oxford regional health authority for 1981·82 was calculated.

Revenue allocations are made on the basis of the recommendations in the report of the resource allocation working party, which provides a broad assessment of relative health care need between different populations.

As the needs include population movement, what action is my right hon. Friend taking to ensure a fair distribution between the Northamptonshire AHA, with the vast population increase there, and the Oxford AHA, which is vehemently overspending?

Allocation to individual AHAs is a matter for the regional health authority, but special account is taken of the needs of new towns. For the past four years the Oxford region has received a revenue addition specifically to help the development of services in the new towns of Northampton and Milton Keynes. For 1981–82 the sum is £784,000, to be shared between new town developments.

Should not the Minister tell his hon. Friend the Member for Northampton, South (Mr. Morris) that he had better not make comparisons between his own area in Northamptonshire and, for example, the Derby authority, which might lead to the closure of the neurology department, or with the Sheffield health authority, which would result in the closure of a spina bifida hospital for young children, which would mean that the Government are prepared to act as terrorists?

I point out gently to the hon. Gentleman that the Trent regional health authority had built into its allocations this year a percentage growth that was five times that of the four Thames regions and as high as that of any other region in the country. The hon. Gentleman's extravagant language is totally out of place.

The right hon. Gentleman ought to be ashamed of himself.

Order.

asked the Secretary of State for Social Services what steps he intends to take to ensure that National Health Service hospitals do not take advantage of their position to the detriment of fund-raising activities of charities which provide health care as part of their services.

I am aware of my hon. Friend's long interest and involvement in charitable work, including the cottage homes. This is part of this country's unique record of voluntary and charitable work. The new power in the Health Services Act 1980 is intended to continue this, but we shall keep a close watch on its effect to ensure that the voluntary efforts are not undermined in any way.

I welcome the ability of the NHS to tap new sources of funds, but does my hon. Friend agree that it would be counter-productive if charities such as the retail trades cottage homes in Derby, Mill Hill and Scotland were to find their work of total care for the elderly, including health care, undermined by the new measure?

Yes, I agree with my hon. Friend. We shall keep a watch to ensure that that does not happen.

Is my hon. Friend aware that the Lymington hospital appeal in my constituency, which set out to raise £150,000, has now raised over £275,000? I do not wish to disagree with my hon. Friend the Member for Ludlow (Mr. Cockeram), but will my hon. Friend the Minister encourage the trend whereby the public are prepared to contribute from their own pockets towards the provision of public facilities?

Yes. I cannot welcome too strongly what my hon. Friend has said. In going around the country I am amazed at the immense effort that goes into raising voluntary funds for the Health Service and the great deal of good that this does.

asked the Secretary of State for Social Services what representations he has received on clause 1 of the Social Security Bill.

asked the Secretary of State for Social Services what representations has he received on clause 1 of the Social Security Bill.

We have received about 120 such representations, from hon. Members, organisations and individual members of the public.

Does the hon. Gentleman accept that that amounts to representations from virtually all the pensioners in Britain? Does he acknowledge that they are all agreed that the charge levelled by the Government that pensioners and other beneficiaries have been over-provided for is a wicked travesty of the facts, as revealed in any study of the pensioners' price index and other statistics? Will he give the House an assurance that during the passage of the Social Security Bill, which is now in Committee, he will seek to introduce an amendment that makes provision to pay back any shortfall that might arise in future?

The hon. Gentleman is right in saying that representations have been received from various pensioner organisations. They are all concerned with the 1 per cent. clawback. The hon. Gentleman will know that my right hon. Friend the Prime Minister has given an undertaking on future shortfalls. There is provision in existing legislation to deal with them should they arise.

Does the Minister agree that heating costs form a large part of the pensioners' budget? As the cost of electricity and gas is increasing by more than twice the increase in pensions, will he tell me how an ordinary pensioner with no income other than the basic pension will be able to pay the additional heating costs?

The hon. Gentleman will appreciate that the uprating contains an element of forecast of future increases. The expected increases in fuel costs were taken into account when calculating the uprating of 10 per cent., which will come into effect in November.

asked the Secretary of State for Social Services what would be the value of retirement pensions for a single person and a married couple, respectively, had they been increased in line with earnings in 1978 and 1979 and prices in 1980.

In November 1978 the standard weekly rates of basic retirement pensions would have been £19·85 for a single person and £31·75 for a married couple. In November 1979 the rates would have been £23·65 and £37·80 and in November 1980, £27·30 and £43·65.

Is the hon. Gentleman aware that through the Government's legislative changes in social security arrangements pensioners are beginning to realise more and more the extent to which they have been done out of their rightful increases by the Government? They are aware that their pensions are failing to keep pace with the rise in the cost of living. Many pensioners are quite desperate because they do not know how they will meet the increases in rents and in fuel and food prices throughout the coming year.

The changes made in the Social Security Act 1980 broke the link between pensions and increases in earnings. We were pledged—and we have maintained our pledge—to keep pensions in line with rises in prices. We have the commitment that when Britain returns to prosperity the pensioners will share in that prosperity.

asked the Prime Minister whether she has had any recent consultations with the National Economic Development Council about the Government's economic strategy.

I took the chair at the NEDC on 4 February. Three items were discussed: industrial trends, overseas capital projects and a report on the diesel engines industry.

How can trade union leaders expect to be taken seriously as partners in discussing Britain's economic future if they refuse to attend tomorrow's NEDC meeting because of the Civil Service picket line? Will my right hon. Friend impress on the six senior trade union representatives the folly of such action? Will she ensure that the meeting takes place in any event?

I understand that the trade union representatives on the NEDC have said that they will not attend tomorrow's meeting because they do not wish to cross the Civil Service picket line. Nevertheless, the meeting will go ahead. I very much regret that there will not be trade union representation there, as there are such important matters on the agenda as industrial energy pricing and regional industrial issues.

Is the Prime Minister aware that one reason why the trade union leaders will not cross the picket line that is part of the Civil Service pay dispute is that in her election campaign she told civil servants, half of whom receive less than the average wage, and many of whom receive wages below the poverty wage line, that if they voted for free collective bargaining, Mrs. Thatcher and the rest they would be able to get all the wages possible in line with those paid to people engaging in free collective bargaining outside the Civil Service?

Order. It is very unfair to other hon. Members who wish to ask questions——

I have nearly finished.

The hon. Gentleman had better nearly finish quickly.

Is the right hon. Lady aware that civil servants are asking her and the rest of her tawdry rotten Government to carry out their mandate? That is all that they are asking. That is why there are picket lines. and that is why——

Order.

The hon. Gentleman might reflect on the fact that since his Government were in power civil servants——

That is nothing to do with it.

Order. I must tell the hon. Gentleman that it is not only bad parliamentary manners, but sheer bad manners to keep shouting while others are trying to speak in the Chamber. He should try to control himself.

On a point of order, Mr. Speaker.

Order. Perhaps the hon. Member will leave his helpful point of order until the end of Question Time.

Since the Government of the hon. Member for Bolsover (Mr. Skinner) were in power civil servants have been awarded pay increases of 50 per cent. over the last two years, on top of which they have been offered another 7 per cent., which most of us believe is a good deal for those in the public sector. Many in the private sector would wish to have those levels of pay.

On a point of order, Mr. Speaker. At the start of Prime Minister's questions you had cause to remonstrate with the hon. Member for Bolsover (Mr. Skinner). From a sedentary position the hon. Member addressed a highly offensive remark to you. My point of order is to ask whether it would be in order for you now to ask the hon. Member to withdraw that remark, without having to repeat it in the House——

Order. There are times when am mercifully spared from hearing what is said by the hon. Member for Bolsover (Mr. Skinner). I did not hear the remark.

My hon. Friend the Member for Salford, East (Mr. Allaun) did.

In that case, perhaps there is better hearing on the other side of the House.

rose——

Order. I am content to leave the matter where it is.

asked the Prime Minister if she will list her official engagements for Tuesday 31 March.

This morning I had meetings with ministerial colleagues and others. In addition to my duties in this House, I shall be having further meetings later today. This evening I shall attend a reception given by the Indian high commissioner.

During her busy day, will my right hon. Friend consider the position of public sector unions as well as the Civil Service unions? Does she agree that those who are responsible for providing essential services for the nation and who wish to achieve pay settlements in excess of those that are freely entered into in the private sector can do so only by entering into binding no-strike agreements?

With regard to Civil Service pay, 7 per cent. already exceeds what a number of people in the private sector will receive. With regard to the nationalised industries, there is undoubtedly great difficulty in applying the same disciplines to them as to companies that suffer from bankruptcy if they do not achieve competitive prices in the market. Most of us think that people should be paid for their work, and not for no-strike agreements. It is always possible to consider that. I would add one thing. Those whose service is vital to the well-being of the citizens should stick at their jobs.

Is the right hon. Lady aware that many trade union leaders tell us that even when they visit the House and attend meetings in her presence they are to be seen and not heard? What is the difficulty about their not crossing the picket line in the Civil Service dispute? It is a waste of time for them to see her at any time these days.

What absolute nonsense the hon. Member talks. When I take the chair at the NEDC the trade unions are vocal in what they wish to say. When about 40 of them come to see me, the difficulty is to persuade 37 of them to say anything at all.

Will the Prime Minister find time today to congratulate those responsible for securing the biggest export order in British history—the order for the Castle Peak B station in Hong Kong? Will she say what that means to this country in terms of employment? Will she tell the British industrialists that that order, following the earlier vast order for the Castle Peak A station and the equipment for the mass transit railway, shows what opportunities there are in Hong Kong for British business men?

The order is worth about £550 million. It is a major success for British industry, working with the Government, to have achieved the order for Castle Peak B, in addition to Castle Peak A. The order will provide between 5,000 and 7,000 jobs over the next seven years, many of them in assisted areas where they are most needed. All concerned are to be thoroughly congratulated on taking advantage of those opportunities.

Perhaps I might revert to the answers given by the right hon. Lady about the Civil Service dispute. If she is so certain of the Government's case, why are she and her colleagues so afraid to refer the matter to arbitration, as the unions have asked? Has the right hon. Lady had time today to study the latest report of the CBI on the state of the British economy? Does that report accord with her view and that spread by her fellow Ministers that there is increasing evidence of an upturn in the economy?

The answer to the right hon. Gentleman's first question is that the Government have a duty to decide what the taxpayer can afford to pay public servants. The more money that goes on current expenditure, the less there is for capital expenditure. The more that goes on current expenditure, the more unemployment is created, because that money could otherwise be spent on vital capital projects. I hope that those in the Civil Service will remember that.

Will the right hon. Lady tell us who are those other forecasters? Will she tell us specifically whether she agrees with the CBI's judgment, in its latest report, that the Budget reduced demand and increased business costs? Does she not think that that is a plain statement of fact?

The answer to that last question is "No, Sir". There was a good deal in the last Budget to relieve industry. There was a reduction in interest rates of a further 2 per cent. which is worth about £700 million over a year. There was a generous scheme for stock relief, and further relief for big users of fuel in industry. The latest outside forecasts from the NIESR, the London Business School, Phillips and Drew, and the Central Statistical Office indicators—long-term, coincident and short term—all suggest either a levelling out by the spring or an upturn.

Does the right hon. Lady not appreciate that the report from the CBI, which she says she has read, takes into account those factors and still arrives at the conclusion that I suggest, namely, that unemployment will be increased rather than reduced by the Budget? Is the right hon. Lady really trying to tell the country that the CBI consists of a group of liars?

Of course not. I deeply resent the fact that the right hon. Gentleman chooses to say that. The Budget will not increase unemployment. What is more likely than anything else to increase unemployment is people taking out more for themselves, regardless of the effect on others.

asked the Prime Minister if she will list her official engagements for Tuesday 31 March.

I refer my hon. Friend to the reply which I gave some moments ago.

Is my right hon. Friend aware that Vauxhall Motors in Luton, having been on a one-day working week for several months, is now moving to a four-day week and full production? Does she agree that that shows the confidence which several businesses, large and small, are showing in the Government's economic strategy?

The answer to my hon. Friend is of course "Yes, Sir". Some companies are being realistic and making themselves competitive. They are the ones that will receive orders and be able to offer future and sound job prospects. Vauxhall is not alone in that. Some of the best news that we have had is the Hong Kong order, which will provide many jobs, and which was won because of the efficiency of these companies and the help given by the Government.

Will the Prime Minister find time to have a word with the Secretary of State for Social Services about the important decision that he has taken to appeal against the award by a medical tribunal of a mobility allowance to the parents of an autistic child? In this International Year of Disabled People, is she aware that it would be greatly appreciated if she took a personal interest in a matter that concerns so many people?

I shall have a word with my right hon. Friend the Secretary of State, but I expect that he took the decision on legal advice.

Whatever discussions my right hon. Friend has with the NEDC, will she take no notice of the opinions of the 364 economists, whose various opinions have been tried and have failed?

I thought that the 364 economists did more damage to themselves than to anyone else.