To ask the Secretary of State for Energy when he proposes to announce his detailed plans for the privatisation of the electricity industry.

To ask the Secretary of State for Energy when he expects to publish his proposals for the privatisation of the electricity supply industry.

I refer my hon. Friends to my statement to the House of 25 February 1988.

Is my right hon. Friend aware that his proposals have been widely welcomed by those who wish to get into the business of electricity production, and that provisional contracts are already being negotiated between private generators and area boards at about 3p per unit of electricity? Is that not evidence that the competitive surge is already beginning and that this will lead to electricity price reductions and a better deal for the consumer and for industry?

My hon. Friend is right. There is scope for competition in generation. I believe that that competition will put a downward pressure on costs, and we shall ensure through regulation that the benefit is passed to the customer.

As my right hon. Friend is aware, a large number of CEGB employees live in Stockport. This privatisation differs from others because the employer after privatisation will not necessarily be the same one as before. Can my right hon. Friend say how the change over for employees is to be effected? In particular, will he say something about pension rights and the right to subscribe for shares?

This will be a matter for detailed negotiation with the industry, now that we have declared the structure. We made it clear in the White Paper that the negotiating rights would not be interfered with and the machinery would not be disturbed. We also made it clear that one of the scares that are normally run on these occasions—that pensions would be threatened—was without foundation, and that we would ensure for everyone in the industry the right to buy shares on preferential terms.

The Secretary of State referred to the detailed plans in the White Paper, but there is nothing in the White Paper about the sort of price protection that there will be for consumers. There are worries in my part of the country that account may be taken in future of reactive losses, the costs of which are currently distributed around the country, and that therefore high price rises may occur in the further-flung regions of the country, to which there are high transmission costs. Can the Secretary of State give any reassurance to my constituents?

Yes. If the hon. Gentleman looks again at the White Paper he will find that the regulator will be charged with the duty of making sure that the distribution companies do not abuse their monopolies, that the savings they make in costs of generation should be passed on and that their own prices will be put under pressure.

What will the Secretary of State's privatisation proposals mean for the four outstanding orders for coal-fired power stations?

We expect those orders to be pursued. We believe that there is an important future for coal and that well into the foreseeable future coal will continue to be the major source of our electricity.

What can my right hon. Friend say to allay the fears that the form of privatisation that he has chosen will not merely exert pressure on the Coal Board to be efficient, which is acceptable, but will unleash competitive forces which will lead finally to the virtual closure of the British deep mine coal industry?

That is pessimistic nonsense. There will be a need for 75 million tonnes of coal a year, and I refuse to believe that the British coal industry, backed by substantial investment and the most modern equipment, cannot meet the challenge of supplying most of that need.

Can the Minister tell us whether, in his detailed plans, he is prepared to give the regulatory body the power to investigate the comparative value of investment in energy conservation, as opposed to the expansion of energy supply? According to the Prime Minister, £7 billion worth of savings could be made in energy conservation.

I do not think that that will be a matter for the regulator. However, the hon. Gentleman has made an important point. Nearly £7 billion a year is wasted in paying for energy, which is subsequently not used properly. We believe that there is tremendous scope for savings for the domestic consumer and for industry. I hope that industry will focus on the scope for reducing its costs by the better use of what it is at present buying.

To ask the Secretary of State for Energy how much public funding is being provided for British Coal in the current year.

The Government expect to provide £916 million in grants to British Coal in 1987–88.

I thank my hon. Friend for that reply. Is he aware of the great and widespread concern among manufacturers at the high cost of investment within the coal industry, which they are having to pay through their taxes? Is he further aware that some companies, such as the Rover Group, have learnt to live within their means and have not borrowed from the public purse, nor will they in future, and that they look upon the cost of providing the coal industry with the resources it wants as a direct burden upon their profitability? When is the coal industry going to pull itself up by its own boot straps?

My hon. Friend is right to say that we have been backing the coal industry with taxpayers' money as no other Government have done before. It has been provided with £9 billion in the past nine years—an average of £1 billion per year. My hon. Friend is absolutely right to say that the taxpayer naturally expects a return on his money. That is why we deplore any continued disruptive action in the pits, which has so far this year cost British Coal £100 million of operating profit. That happens to be the same as the estimated cost of building Margam.

Will the Secretary of State join me and the House in congratulating the work force of Murton colliery on breaking all productivity records during the week in which we celebrated our 150th anniversary and the cutting of the first sod? Does the Secretary of State agree that, in order to facilitate an atmosphere for increased productivity greater efficiency and better industrial relations, the dismissed miners who lost their jobs during the 1984–85 dispute should now be offered their jobs back?

Of course I join the hon. Gentleman in congratulating the workers at Murton colliery—which I know because I was a candidate there for 10 years, opposing various predecessors of the hon. Gentleman—on their productivity record. It is true that British Coal as a whole has been making great strides in productivity.

My hon. Friend may care to know that the miners in Nottinghamshire appreciate the Government's total commitment to investment in the coal industry and that, given the opportunity, they will continue to increase productivity. Does my hon. Friend agree that there has been not only increased productivity but increased safety? Only last year the safety record in Nottinghamshire increased dramatically and, given the conditions there, that record will continue to improve.

I very much agree that a thriving coal industry, with the backing of modern equipment, will be a much safer industry.

Does the Minister accept that the Government's case for public investment in the coal industry is imperilled by the enthusiastic shortsighted pursuit of cheaper, uneconomic and often dumped coal imports? Does the hon. Gentleman also accept that not only that investment but the future of the coal industry and the mining engineering and equipment industry may be imperilled if that reckless course is pursued, at enormous cost to Britain's future balance of payments?

I should rather put my answer the other way round: British Coal, with the backing of the taxpayer in recent years, is in a good position to compete against all corners if it will use the equipment properly. The key question is whether that equipment will be used properly.

To ask the Secretary of State for energy when he last met representatives of the International Atomic Energy Agency to discuss nuclear safety.

My right hon. Friend and I have met representatives of the International Atomic Energy Agency on a number of occasions. The Government are totally committed to ensuring that the British nuclear industry maintains its outstanding safety record.

Does my hon. Friend agree that those hon. Members who are concerned about the safety of our nuclear installations should arrange to visit the Risley laboratory of the Atomic Energy Authority, where they will find evidence that the British nuclear industry presents a reservoir of expertise and skill in safety matters that is unsurpassed anywhere in the world?

My hon. Friend is right about the excellent job done on safety matters at Risley. The British nuclear industry's record is second to none on these matters, and we mean to keep it that way.

There have been contradictory press reports about the experiment which was supposed to be conducted at the Trawsfynydd nuclear power station. The flow of cooling fluid was to be turned off in a Chernobyl-style experiment. Has that experiment been postponed, or cancelled?

That is a matter for the CEGB. The experiment has been postponed but, of course, any test would be done under totally different conditions from anything comparable to Chernobyl. It is wrong to raise the Chernobyl matter. As one example of what would have happened, the power station would have been shut down. There was no question of the kind of experimentation and lack of safety systems that existed at Chernobyl being seen here. There is no comparison between the two. At the moment, the CEGB has postponed the experiment.

Does my hon. Friend agree that the highest standards of international agreements on nuclear safety are vital to this country, not because the British nuclear industry is in any way wanting — it has the highest safety standards of any country — but because there are so many foreign nuclear reactors, and if there were a serious accident the effect on the people of Britain as well as on the people of other European countries would be devastating?

What my hon. Friend has said is absolutely true, and part of the reason—perhaps the main reason—why we co-operate so greatly on international matters is that we see it as imperative that the kinds of standards that we adopt here are as widespread as possible throughout the world.

With regard to international co-operation in the nuclear industry, will the Minister ensure that any natural circulation tests that take place in the future at Trawsfynydd, or elsewhere, are subject to inspection by international representatives from the European Community and from the International Atomic Energy Agency?

If I were to say yes to the hon. Gentleman, which I do not plan to do, that would suppose or presume that we have less than total confidence in our own regulators, which, of course, is not the case. We have total confidence in the Nuclear Installations Inspectorate and in the operators to ensure the continuation of safety in the British nuclear industry.

To ask the Secretary of State for Energy if, when he last met the Confederation of British Industry, he received a copy of the report it commissioned from the Oxford Economic Research Association on "The Privatisation of the Electricity Supply Industry"; and if he will make a statement on its conclusions.

I have received a copy of the report and I shall be discussing it with the Confederation of British Industry shortly.

Does the Secretary of State accept the conclusion of the reporters, who are convinced supporters of his privatisation programme, that a 15 per cent. price increase is totally unjustified on the ground of an increased rate of return on investment? Does he, therefore, accept their statement that the price increase is concerned only with increasing the value of the assets, which supports the view of the Opposition that the 15 per cent. price increase is totally unjustified and is really a privatisation tax to benefit the Treasury, paid for by the consumer, which will produce higher prices and higher unemployment?

No, Sir, we do not accept either the conclusions or the reasoning of the report, and if the hon. Gentleman read it carefully, he would not either. We do not believe that short-run marginal costs are a sensible basis for pricing electricity. We do not think that the fluctuations that would follow from such a policy would be acceptable to the hon. Gentleman or to anybody else in the country.

That is competition.

No, it is not.

Is my right hon. Friend aware that the increase in the subscription rate of the Confederation of British Industry over recent years has been considerably higher than the increase in electricity prices? Is he also aware that during the past five-year period that subscription rate has increased by twice the rate of the increase in electricity prices to industry? Does he consider that that might be one reason why the number of manufacturing companies in the CBI has fallen, and is that not a case of people in glass office blocks?

My hon. Friend has put forward an interesting set of facts of which I was not aware until now. The CBI has grossly over-reacted to our proposals, and its assessment of the impact on the overwhelming majority of its members is totally wrong.

In an interesting article in the Sunday Express yesterday the right hon. Gentleman made the point:

"We are ending monopoly wherever possible. This won't mean that households will be able to choose between rival electricity"—

Order. The hon. Gentleman is an old parliamentary hand. He must paraphrase, not quote.

I am not reading it, Mr. Speaker; I am just referring to it.

I hope that the hon. Gentleman will follow his reading of my article by reading the White Paper, in which I explain that although distribution is a natural monopoly, generation is not, and generation accounts for 80 per cent. of the costs of electricity. It is perfectly possible to introduce competition into that part which represents 80 per cent. of the customers' bills and to regulate the rest.

Does my right hon. Friend agree that his proposals will allow more decision-takers to be involved in the industry? The Opposition should recognise that that is healthier for both the suppliers of generation equipment and the consumers of electricity.

I believe that our proposals will open up good career opportunities for many people working in the industry. I do not like the present structure, whereby the average area board consists of two people—usually they have come in from outside the board—and about 12 non-executives. I believe that, in future, there will be scope for promotion within the business for people who have devoted their lives to it. I hope that the Opposition will welcome that.

To ask the Secretary of State for Energy if he has had discussions with British Coal regarding its threatened court action against the South of Scotland Electricity Board, announced in the press release of British Coal of 17 February.

To ask the Secretary of State for Energy if he will make a statement on his discussions with British Coal and the South of Scotland Electricity Board on the future of the coal industry in Scotland.

I hope that British Coal and the South of Scotland Electricity Board will reach satisfactory arrangements. This is a commercial matter for the two industries.

Surely the hon. Gentleman is aware that his Department sponsors the coal industry. Is he trying to tell the House that he and his right hon. Friend did not know that the Secretary of State for Scotland intended to sit on his hands and do nothing about the threat to wipe out the deep mine coal industry in Scotland? We regard the Minister and his right hon. Friend as conspirators in this betrayal of the Scottish miners.

I thank the hon. Gentleman for reminding me that we sponsor the coal industry. The Government are totally at one on this matter and no one is conspiring against anyone else. In recent years the Government have invested £120 million of taxpayers' money in the Scottish coal industry. Therefore, there is no doubt that we would prefer British Coal and the SSEB to spend more time talking to each other in an effort to resolve this problem than fighting each other in the press and the courts.

Does the Minister support the SSEB's short-term marginal costings?

There are two sides to the issue of costings — the question whether electricity consumers are benefited and employees—

Answer the question.

I will answer the question in my own way. There is also the question whether the consumers or the employees of the coal industry are benefited. The two industries are fighting each other and they each have their own perspective on the issue.

Does my hon. Friend agree that, although it is invariably appropriate and occasionally necessary for parties to a dispute to settle that dispute and determine their obligations before the courts, it is at best inappropriate and at worst disastrous that energy policy is determined by the courts?

As I have already said, the Government would infinitely prefer the matter to be settled as a result of discussion between the two industries.

Does my hon. Friend agree that the Scottish coal industry has a bright future, bearing in mind the huge amount of capital invested in the industry by the Government? That future is likely to be blighted only if coal cannot be produced at an effective and efficient price. Bearing that in mind, does my hon. Friend share my surprise that, in the latest ballot held by the National Union of Mineworkers, some 51 per cent. of Scottish miners wanted to continue with the overtime ban, which will do no good whatever for the future of British Coal, but which is no doubt supported by the Labour party?

My hon. Friend is absolutely right. The continued disruption at the Scottish pits has done no good whatever. At the end of the day, unless the consumer of electricity in Scotland is to be disadvantaged, coal must be produced at a competitive price.

The Minister has made reference to capital investment in Scotland. How much of that investment was made at the Longannet complex? What return can the nation expect from that investment if the product of the mines in that complex is not used by the SSEB?

The answer to the first part of the hon. Gentleman's question is £60 million. The answer to the second part of the question is that it depends, as I have already said, on the industry making use of the capital invested. The Government have put the capital behind the industry, but it is up to the industry to make use of it by producing coal at the right price.

Does my hon. Friend agree that many more people are employed in energy-using industries in Scotland than are employed in the Scottish coal industry? Does he agree also that if the SSEB were to pay through the nose for electricity employment in energy-using industries would be put substantially at risk? Can he justify the calls by Labour Members that the pensioners of Scotland should be asked to pay more for their electricity in order to subsidise the lackeys of Mr. Scargill?

My hon. Friend makes a good point. Speaking from memory, I believe that about 4,000 people are employed in the Scottish coal industry, so my hon. Friend is likely to be right about the number of people who would benefit from cheap electricity prices. The Government's position is that the industries must sort the matter out themselves.

Does the Minister wish to maintain his position of 15 February — that the present impasse between the SSEB and British Coal has

"nothing to do with privatisation"

No, Sir.

Do the Government have a policy for the future of the Scottish coalfield, or do they intend to sit back and act like disinterested spectators?

The Government's policy is to provide the most efficient industries for our consumers that it is possible for this country to provide. We put a great deal of money into the Scottish industry in the belief that it would make the best use of that equipment, and now we are concerned about the continued disruption that is preventing that equipment from being used properly.

To ask the Secretary of State for Energy if he has recently met the chairman of the National Nuclear Corporation to discuss British involvement in the pressurised water reactor programme.

I have met the chairman of the National Nuclear Corporation on various occasions. United Kingdom industry has contributed 93 per cent. of the value of the contracts let for Sizewell B to date.

Did my right hon. Friend approve the recent decision by the CEGB to prevent the formation of a new PWR construction company by the National Nuclear Corporation and Westinghouse? How does he see the future involvement of the NNC and British contractors in PWR construction in Britain?

I regard the NNC as a valuable national asset. At the moment there is a question mark over its future which I am anxious to see removed. I am discussing this with various parties, and as soon as I have more to report to the House I will do so.

Did the Secretary of State discuss the level of insurance cover for liability on PWRs? I thank the Secretary of State for the letter that he kindly sent to me today. In view of the Minister's comments today on how safe and how far ahead of the rest of the world our nuclear industry is, will the Secretary of State explain why the cover that is required is only £20 million, when the cost of any accident could be infinitely greater than that? Why is it that after privatisation the public taxpayer will have to fund any compensation over and above £20 million, whether the accident is at Sizewell or at any other station?

The agreement that is incorporated in the Act, which sets the £20 million limit and puts the rest of the cost on to the general body of taxpayers, is an international agreement to which Britain is a signatory, and one that we intend to uphold whether the industry is in the private or the public sector. We do not accept that there will be any change in the standards of safety in the private sector. There will be no relaxation in those standards, and we shall continue to remain a signatory to the international agreement that is embodied in that Act.

Does my right hon. Friend agree that the National Nuclear Corporation has a first-class record in the design and project management of nuclear power stations under construction, that Torness and Heysham have been built both to time and to cost, that it is vital for the future of the nuclear industry that power stations continue to be built in a cost-effective way, and that the best way of achieving that is to have an independent contractor constructing these stations after privatisation?

Yes. I think that the 3,000 employees of the National Nuclear Corporation have done a good job for Britain and I want those skills maintained and that expertise to remain available. That is why I am in discussion with various parties. I shall report as soon as I have more to say to the House.

To ask the Secretary of State for Energy if he will make it his policy to support the European Commission's proposed directive on energy efficiency surveys of buildings for sale.

No. Sir. The United Kingdom Government share the view of most other EC member states that it is not appropriate to require the householder to spend between £100 and £200 of his own money on a mandatory home energy audit.

Is the Minister aware that the former Secretary of State for Energy was an enthusiast for such a scheme, that experience in Denmark is that for every £1 of survey costs there are £4 in private investment, that the European Commission is promoting the scheme and that the British Government alone are resisting its introduction? Given the abysmally low level of domestic energy efficiency in Britain, which the Secretary of State has admitted, why not introduce the scheme? Why is there no reference whatsoever to energy efficiency in the White Paper on electricity privatisation?

There are two fallacies in the hon. Gentleman's supplementary question. First, it is not true that all other Governments are backing the scheme for mandatory auditing. Nor is it true that the Danish experience has been particularly successful. The scheme is subsidised by the Danish Government and is mandatory, but the take-up rate had been only 50 per cent. We believe that it is much better to deal with the problem through direct grants to those who need the money. We have spent £20 million on household loft insulation in about 500,000 households, and 400,000 houses have been draught-proofed, at a cost of about £45 million. It is much better to do that for those on low incomes.

To ask the Secretary of State for Energy if he has any new proposals to improve national energy efficiency.

The Energy Efficiency Office is consulting outside bodies with the aim of developing programmes in the most economically attractive areas. We are also examining how the contribution from companies which benefit from the Department's programmes can be increased. I hope to announce the outcome of this work before the summer recess.

I am grateful to my right hon. Friend for that reply. I know that he is aware of the energy study in the north-west that was undertaken by the March Consulting Group, and I am aware also that he recognises one of the conclusions of the study, namely, that in the north-west industry and commerce could save up to 15 per cent. of energy demand by using known technology. Does he agree that the CBI would be better employed exhorting its members to seek to obtain that saving of 15 per cent. than simply whingeing about electricity prices increasing?

It is true, as I said earlier, that there are substantial savings to be made by using energy more efficiently. The Department has been sponsoring a number of projects — I hear Opposition Members making sneering remarks—that have resulted in more than 90 per cent. of lofts in Britain being insulated. By the end of the year we shall have insulated the homes of over 700,000 pensioners. We are making real progress in helping those on low incomes to save energy. It is important that we continue to make progress.

How can the Secretary of State talk about national energy efficiency when the Under-Secretary of State has been talking about the substantial investment that has been made in the Scottish coal industry and the Secretary of State for Scotland is idly standing by and allowing the coal industry and coal-burning power stations in Scotland to be scrapped?

I realise that the hon. Gentleman wanted to make his point about the coal industry, but I genuinely think that he has chosen the wrong question on which to do so. This question is to do with the more efficient use of energy in homes and by industry. We are talking about the end user. We believe that there is substantial scope for savings, and so did the March group, whose report I endorse.

To ask the Secretary of State for Energy how much will be spent by his Department on research into alternative methods of energy in the next five years.

The public expenditure White Paper, Cm. 288, published in January 1988, envisages that up to 1991 about £50 million will be spent on research into renewable sources of energy. Information for subsequent years is not available.

Is my hon. Friend aware that the House will welcome the proposal in the White Paper on the privatisation of electricity to put non-renewable sources together with nuclear under a single quota? That is greatly to be welcomed. Will he consider bringing forward his surveys into and studies of renewable energy as soon as possible?

My hon. Friend is right to say that renewables are included in the quota of non-fossils in the White Paper. That is widely welcomed. We shall produce the survey and report by mid-summer.

To ask the Secretary of State for Energy on how many occasions in the last 12 months electricity has been exported to France via the cross-Channel link.

None since January 1987. In 1986–87, 188 GW hours were exported to France via the Channel link.

Is it not a fact that for most of the time electricity has been imported from France? Is it not important that when the privatisation of the electricity industry takes place some safeguardss are put into the Bill to ensure that the industry does not continue to import at ever-increasing rates, to the detriment of our own electricity industry?

The safeguard, if that is the right expression, is that French electricity is interruptible, and cannot therefore be guaranteed. It comes in at a lower price commensurate with that fact. It is highly unlikely that the mainstream of base-load electricity will be imported, but we shall certainly not restrict it.

To ask the Minister for the Arts if he will take steps to ensure that suitable musical instruments are available at reasonable prices to talented young musicians.

No, Sir. It is not the Government's policy to subsidise the purchase of instruments, but there are several trusts which make loans for the purpose, at nominal rates of interest.

Does my right hon. Friend agree that our young musicians — teenagers as well as young professionals — need instruments commensurate with their talents? While recognising, as he does, the invaluable contribution made by the loan fund for musical instruments, other trusts and private patrons, may I ask whether he will consider getting together all interested parties, preferably with a number of financial institutions, to ensure that Britain can maintain its musical preeminence?

I acknowledge the fact that musical instruments do, or can, cost a great deal today, and that that can pose a problem for certain people, but, as my hon. Friend said, the loan fund for musical instruments has been set up especially to help professional musicians or potential professional musicians. There are also other grant-making trusts that make loans for this purpose and help other people who are not necessarily professionals. That is the right way to go. I do not think it is right to give taxpayers' money direct to this end, but if my hon. Friend has more specific, detailed ideas, I should like to hear them.

Is the right hon. Gentleman aware of the excellence of the musical education provided by the Inner London education authority, particularly by its special music school? What provisions will he made for safeguarding ILEA's musical education, and particularly its school? What discussions is the Minister having with his colleagues at the Department of Education and Science?

There is no doubt about the importance of the support given by ILEA to the musical side of things, and discussions are taking place between my Department and that of my right hon. Friend the Secretary of State for Education and Science.

To ask the Minister for the Arts what central Government funding has been and will be given to the British Film and Television School in the period 1985–86 to 1990–91.

I provided £3,347,000 over the three years 1985 to 1988. I plan to allocate £4,950,000 over the three years 1988 to 1991, which I hope will be matched, or more than matched, by contributions from the industries.

Is my right hon. Friend aware that most people associated with the film industry will warmly welcome the increases that he has announced? Do the video and advertising industries, which make full use of the graduates from the school, contribute to its running costs? Many of us think that if they do not, they should.

My hon. Friend has a point. They do not contribute at present, but I hope that they will respond to the substantial increase in Government support over the next three years by starting to give their own support. My hon. Friend might like to know that I have injected £300,000 of incentive funding for the school. I hope that that can be used to encourage such industries to join in.

Is the Minister aware that other countries treat their film schools a great deal more seriously and put in a great deal more investment? The Paris and Berlin film schools, which have costs comparable to ours, receive twice as much central Government investment per student. Is it not time that the Government started recognising the enormous cultural and economic importance of the film industry and began investing in it?

The issues on which the hon. Gentleman tends to intervene never cease to amaze me. I have increased the amount of funding for the school by 42 per cent. in the coming financial year, and by 50 per cent. over three years. That is a strong indication of the importance that I attach to the school. It already has a high international reputation, and it is right that its financing should be based on joint funding between the Government and the television and other industries.

To ask the Minister for the Arts how the Government indemnity scheme assists art in the regions.

By removing the need for commercial insurance of exhibitions mounted for public benefit, the Government indemnity scheme has proved very effective in encouraging loans of works of art between London and the regions as well as between provincial museums and galleries.

Is my right hon. Friend aware that for a small regional establishment, such as Gainsborough's House in my constituency, this scheme is of considerable importance? Will he assure the House that he will continue to develop the scheme, as it offers a means whereby people living in the regions can have access to art treasures that are all too often available only to those who live in or visit London?

I certainly acknowledge the important role played by Gainsborough's House, and I reinforce yet again the importance that I attach to encouraging more exhibitions of our treasures around the country. The public have a right to see them, and the more that the exhibitions can be encouraged, the better. It might be of interest to my hon. Friend to know that this year there has been an increase over last year of 66 per cent. in the applications for indemnity, amounting to £322 million. In addition, I have established, at the Museums and Galleries Commission, a travel and exhibition unit that is designed to encourage these exhibitions.

While welcoming the Minister's statement on this matter, may I ask whether, when he visits the Photographers gallery, which I understand will be in Cardiff in the next week or two, and the Side gallery in Newcastle, he will ensure that as we approach the 150th anniversary of photography he will do all that he can to encourage those galleries to take advantage of the scheme so that we can have more exhibitions from London visiting the regions?

I am very happy to do just that. I must stress that these are subject to certain conditions, including security, because if such conditions are not satisfied we cannot go ahead with such schemes. However, subject to that, my answer is yes.

To ask the Minister for the Arts whether he plans to visit the Redgrave theatre, Farnham.

I enjoyed my visit to the Redgrave theatre on 27 February this year and I am very impressed by the way that the theatre is run.

My right hon. Friend's visit to the Farnham theatre was greatly appreciated. Is he aware that it is the most active repertory theatre in the country and was open 359 days last year and gave 419 performances? Is he aware that for the second time running it has won an award for new sponsors? What steps is he taking to draw to the attention of other regional arts organisations the example set by the Farnham theatre, particularly in responding to his business incentive scheme?

My hon. Friend is right. The Redgrave theatre is a model. It raised 67 per cent. of all its resources from the private sector, largely through the box office, but also through sponsorship. There is a true partnership there between the public and the private sectors. My hon. Friend is right to say that it is the most prolific in productivity of all the repertory theatres in Britain and that it has received business sponsorship incentive scheme awards over the last two or three years. It is a very fine model for other theatres.

To ask the Minister for the Arts if he will make a further statement on the progress of the business sponsorship incentive scheme.

The business sponsorship incentive scheme continues to be successful. It has brought in £16·4 million of new money for the arts and attracted 618 first-time sponsors, many of whom have continued to sponsor the arts. As I announced to the House on 26 January 1988, I have increased the budget for the scheme by 70 per cent., from £1·75 million to £3 million, for 1988–89 and restored the £25,000 maximum award limit.

I thank my right hon. Friend for that excellent news. Will he reassure me that the awards will continue to be given on merit rather than on skin colour?

Yes, I can assure my hon. Friend of that.

Will the Minister take steps to ensure that the regions receive their share of benefit from the scheme, which is good, but at present seems to be giving too much advantage to London and the south-east?

I am very anxious that the scheme should be spread as widely as possible. The hon. Gentleman will be interested to note that, on average, 70 per cent. of the funds over the past three years have been directed outside London. That shows how widespread is the scheme.

To ask the Minister for the Arts how many new corporate sponsors of the arts have been brought in during the last 12 months as a result of the business sponsorship incentive scheme.

The scheme continues to attract new sponsors to the arts. There were 216 first-time sponsors in 1987 and I expect this number to increase considerably in 1988.

Can my right hon. Friend say how many first-time corporate sponsors returned to repeat their generosity in subsequent years?

It is interesting to note that a survey has been undertaken by the Association for Business Sponsorship of the Arts, which supervises the scheme, which shows that no fewer than 90 per cent. of firms that joined for the first time have either decided to renew, or are in the process of renewing, their sponsorship. That is a clear sign of the value of the hard-headed bargain between the sponsor and the arts organisation.

To ask the Minister for the Civil Service what represetations he has received from the Civil Service trades unions regarding the proposal to establish agencies to run certain functions of the Civil Service.

None. The Head of the Home Civil Service met leaders of the Civil Service unions on 18 February to explain the Government's proposals, and the project manager is ready to meet them when they have considered these proposals.

Is the Minister aware that when Sir Robin Butler met representatives of the Civil Service trade unions they were not reassured that there is no hidden agenda behind the Government's proposals and feel that disestablishing of the Civil Service may be a prelude to privatising parts of the Civil Service? Will he assure the House that members of the Civil Service will have their wages and conditions maintained under any new arrangement? Will he agree to meet leaders of the Civil Service trade unions to answer their questions direct, as he is responsible for them?

There will be plenty of scope for consultation with unions when we discuss each agency as it is put forward for the establishment of an agency arrangement. We must get it straight. The hon. Gentleman referred to "dis-establishing" the Civil Service. There is no question of that. People who will in future be part of the agency arrangements will still be members of the Civil Service. There will be no change in that policy on privatisation. If a body currently under Government control is thought to be better managed outside the Government, that is a separate matter. On the whole, what we are considering are organisations that remain under Government Departments.

To ask the Minister for the Civil Service to what extent managers of Government agencies will be able to recruit, set pay, grade and structure staff under the proposed Civil Service reforms.

This will depend on the framework agreement for each agency. The aim is to give agencies flexibility to manage their own affairs within necessary overall controls.

Does my right hon. Friend agree that the public interest would be served by having the maximum flexibility in setting pay, grades and determining the number of staff to be employed in these agencies? Does he further agree that placing a straitjacket around the public services in this country has been one of the biggest curses that we have had to face, as we are now discovering with the National Health Service?

I think that my hon. Friend must be right. We are trying to improve still further the quality of management in the Civil Service. To do that it is necessary to delegate inure responsibility to managers. We have been trying to do that over the last few years under the financial management initiative, and the agency arrangement takes that process a stage further. This is a good thing, and I think that it will lead to improved performances and results in the Civil Service. After all, the Civil Service costs £13 billion in gross running costs. The taxpayer is entitled to the best value for money. I believe that flexibility is right, subject to certain conditions about levels of public expenditure and about standards of fair and open competition in the service.

The Minister cannot have it both ways. He cannot tell my hon. Friend he Member for Nottingham, North (Mr. Allen) that the staff will continue to be part of the Civil Service, and at the same time agree with his hon. Friend the Member for Tatton (Mr. Hamilton) that maximum flexibility is to be welcomed.—[Interruption] If not maximum flexibility, he said that he welcomed flexibility. Can the Minister categorically assure the House that the staff of the agencies will continue to be United Kingdom civil servants and be part of the United Kingdom Civil Service? Can he further assure the House that pay and conditions for the staff of the agencies will continue to be negotiated as at present?

I see no conflict at all in this. We seek only to continue a process that has already started. First, we have already started to delegate more responsibility to managers in the Civil Service. Secondly, to come hack to the point raised by my hon. Friend the Member for Tatton (Mr. Hamilton), we have started to have more flexibility of pay and conditions. London weighting is already a variation in the pay system and we are developing other forms of flexibility in pay. We are simply taking the developments a stage further. Broadly speaking, the agencies will remain in Government Departments for the foreseeable Future. If we think that privatisation is the right path, that is a separate issue altogether. Those who work for the agencies will remain civil servants and under those conditions.

Does my right hon. Friend accept that this is a very valuable initiative? Does he agree that even before the Fulton committee report there was tremendous difficulty in attracting people into the Civil Service for limited terms? Does he envisage the creation of the new agencies as one device for getting over that considerable difficulty?

There are already examples of that. A number of people are recruited from outside the Civil Service for a defined period and under contractual arrangements to undertake particular tasks. I think that from time to time we shall see this develop within the agency system where no existing civil servant is found to be the right chap, for example, to be the chief executive. By and large it is likely that civil servants will be the chief executives, but there may be cases where outsiders come in to serve in the agencies on fixed contracts for short terms.

To ask the Minister for the Civil Service what proposals he has, in the light of the new proposed regime for the Civil Service, to afford protection to those civil servants who allege that they have been misused by Ministers.

Throughout the Civil Service, procedures to deal with complaints about personal matters will continue to exist.

In an age when many Conservatives sadly acknowledge that Mr. Bernard Ingham has become the most important man in British politics, who can tell a well-loved Leader of the House that he has become semidetached and then that he will be sacked, is it not important that an ex-civil servant such as Miss Colette Bowe and a civil servant such as Mr. John Mogg should be able to go to an outside body to air their grievances, rather than having to place their accounts of events such as Westland in a bank vault?

The hon. Gentleman does not seem to have taken account of the guidelines issued on 2 December 1987 concerning the duties and responsibilities of civil servants in relation to Ministers. They provide for new procedures, allowing a civil servant to appeal — in cases of conscience and other matters—first to his senior, then to the permanent secretary and, if necessary, to the Head of the Civil Service. Those procedures, which are totally new, are ideal for the Civil Service and provide a perfectly reasonable outlet.

Does my right hon. Friend agree that the real problem is not so much the misuse of civil servants by Ministers, as the misuse of procedure by the hon. Member for Linlithgow (Mr. Dalyell), with his tedious and repetitive questions, of which we are all sick and tired?

As always. I can agree with my hon. Friend. The hon. Member for Linlithgow (Mr. Dalyell) seems to have an obsession. Experience shows that there has been an extremely good relationship between this Government and the Civil Service.

Has Mr. Bernard Ingham ever complained about being misused by Ministers, or is he happy doing the Prime Minister's dirty work?

I cannot think why the hon. Gentleman is so obsessed with Mr. Ingham, who does an extremely good job.

To ask the Minister for the Civil Service if he will give a timetable for implementing the four principal recommendations of the Efficiency Unit report "Improving Management in Government: The Next Steps".

One of the recommendations, the appointment of a project manager, has already been implemented. One of his first tasks will be to establish a timetable for implementing the other recommendations, and I hope to publish it at an early date.

It is less than a month since my right hon. Friend the Prime Minister made the statement in the House in reply to the Efficiency Unit's report. Will my right hon. Friend accept that there has been widespread acclaim for many of the recommendations of that report, both from inside the Civil Service and from many outside? Does he agree that the best way to keep up this momentum for change, which is generally accepted, is by setting a timetable for the implementation of the four principal recommendations?

I am grateful to my hon. Friend, and he is right to say that there is widespread support for the reforms and changes that are being proposed. The support comes not only from outside the Civil Service, but from managers in the Civil Service. We want to proceed as rapidly as we reasonably can, and I hope to be able to publish before too long a list of those organisations that will be the first to be formed into agencies. We will keep up a relentless drive to identify other organisations that might be suitable for the same treatment.