My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

My Lords, the statement to which the noble Baroness refers was made by Herr Narjes, the outgoing commissioner with responsibility for consumer affairs. It listed achievements during the life of the consumer action programme and indicated his thinking on the future development of consumer policy. Perhaps more important was the statement made more recently by his successor, Commissioner Clinton Davis. This statement suggested a realisation within the Commission that it should concentrate on matters which would bring real benefits to consumers through, for example, the opening up of the Community market to free competition while ensuring that consumers are not at risk, rather than seeking to harmonise the national legislation of member states simply for the sake of doing so. This new realism is welcomed by the Government.

My Lords, is the Minister aware that he has today answered my Question set down for next week? Is he further aware that I wished to give him that same information next week? But, reverting to the Question on today's Order Paper does the Minister realise that the last meeting of the consumer Ministers was held last June and that I am asking him, nine months on from that, about a statement which was made on December 18th and which he himself admitted in this House? Could he now give to me and to the House a more detailed answer to the Question which is down for today?

My Lords, the Question which is down for today surely concerns the statement on the development of the Community's consumer protection policy, which I believe I have answered.

My Lords, the Question down for today, if the Minister will look at the Order Paper, refers to the statement made on 18th December last. Does the Minister not feel that this House is entitled to an answer to that? Would it be possible, if the Minister is unable to give that answer now, to put it in Hansard so that those of us who are interested in consumer affairs might know what is going on, if anything at all is happening?

My Lords, I have answered the Question on the Order Paper; that is, concerning the statement made by the Commission on 18th December. I said that the statement to which the noble Baroness refers was made by Herr Narjes, the outgoing commissioner. I answered the Question quite fully in my original Answer.

My Lords, may I ask the Minister whether he can give us any information about two draft directives of great concern to the consumer, one on product liability and the other on doorstep selling, which have been in the pipeline for years?

My Lords, I can and I will do that. The progress on the product liability directive has been slow. Discussions at the last two internal market councils have helped to clarify-the positions adopted by member states and to explore a number of possible options. There is still some disagreement on the fundamental question of financial limits. I would expect further progress to be made during the course of the year. On doorstep selling, that depends primarily on the one remaining reserve being lifted. The Government would like to see this measure go through without further delay.

My Lords, I am sorry to rise for a third time. Is the Minister not aware that he has not answered the Question on the Order Paper? May we have some elucidation of the statement made by the Commission on December 18th? If he cannot give that elucidation now, will he please put it in Hansard for us?

My Lords, if the noble Baroness would like to put down a clearer Question, I shall be pleased to give a further and more expansive answer. I believe that I have answered exactly the Question that is down on the Order Paper.

My Lords, I wonder whether the noble Lord would be good enough to tell the House how the Government reach a judgment on these directives as to what is best for the consumer in this country. For example, do the Government consult the county councils, who have officials who deal with these matters and whose members are also concerned with the interests of consumers throughout Britain? Can he tell the House precisely how the Government come to a conclusion on whether the directives are good or bad for the consumer?

My Lords, I cannot tell the noble Lord the Leader of the Opposition precisely how that is done because there is nothing precise in this area. When consumer affairs directives, or draft directives, are laid by the Commission, the widest possible range of consultations takes place, particularly with the consumer associations and consumer interests. Of course, they represent the local authorities in certain specific fields. Those views are taken into account and laid alongside our own existing legislation on consumer affairs, which tends to be rather more positive than is the case in some of the member states in Europe.

My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

My Lords, I gladly reaffirm the point that I made on 21st January. Local authorities retain the cash from the sales of capital assets. They can put the money on deposit, repay debt or offset borrowing. There are no proposals for removing this freedom. Moreover, under the capital control system they can in each year use a proportion of their receipts for new capital expenditure.

My Lords, is the noble Earl aware that I am extremely grateful for that reply, bearing in mind rumours that have been circulating in the so-called responsible press that the Government may be considering a moratorium on those capital receipts? May I ask the Minister whether he is aware that both local authority building departments and the private sector are of the strongest opinion that the cut from 40 per cent. to 30 per cent. and 20 per cent. in the money being made available to local authorities from these capital receipts will result in further unemployment in the building sector, which, as I think the Minister will agree, has already been ravaged by unemployment? The situation, if this is carried out, will further deteriorate. May I also ask the noble Earl whether, as a matter of urgency, he will go back to the Secretary of State and the Chancellor of the Exchequer and see whether they will reconsider their decision and restore the amount to 40 per cent. to prevent this further unemployment?

My Lords, I can take issue with the noble Lord about something which came up in the debate which he raised the other day: that is, quite simply, that the growth in the construction industry over the past four years has been steady and increasing. That does not, I admit, take us into 1985. The other point which was raised by the noble Lord is in fact being voted on next week in the House of Commons, and I believe we should leave it like that.

My Lords, I am sorry, but I do not think that the Minister has dealt with the question that I asked. He must be aware, since he has referred to the debate that we had a couple of weeks ago in this House, that certain of the building confederations have taken issue over the statistics that he used, and they have said that the figures were not accurate. In fact, the noble Earl was almost accused by the Federation of Civil Building Contractors of misleading noble Lords in that debate. I wish he would bear that in mind when answering my point. I put the following question: will the Government restore the money made available to the 40 per cent. figure? Will he answer that point and not the other one?

My Lords, I shall be happy to do so but the matter is being voted on next week in an order. Meanwhile, I have not actually made my response to the letter which I received from the federation.

My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

My Lords, according to figures published by the Advertising Association, total expenditure on advertising in 1983 was £3,579 million. Advertising in newspapers, journals and periodicals is zero-rated; all other advertising is taxable at the standard rate. As to the second part of the Question, I am sure it will be understood that I am not able to make any comment at this time in anticipation of the Budget Statement of my right honourable friend the Chancellor of the Exchequer.

My Lords, I am grateful to the noble Earl for his Answer. Will he accept that I am not trying to probe into Budget secrets, but am concerned with principles? Would not the noble Earl agree that if the Government believe it to be necessary to move from direct to indirect taxation, it is desirable to levy those taxes on non-essentials, of which I suggest advertising is one, rather than on such items as home decoration or foodstuffs such as fish and chips?

My Lords, all of these are the kinds of matters which the Chancellor will no doubt be weighing as he prepares his Budget Statement. On advertising generally, I think that perhaps we rush in too lightly to condemn marketing in this country; I believe that it performs a very valuable economic role.

My Lords, would not my noble friend agree that it might perhaps be less harmful to tax those who may wish to advertise than those who purchase the newspapers or periodicals in which the advertisements appear by the imposition of VAT in that field?

My Lords, my noble friend's supplementary question is an indication of how delicate Budget judgments have to be.

My Lords, while I accept that the noble Earl the Minister has a better case than usual for not replying to a specific Question, would it not have been better and more straightforward had he said that in fact business advertising is already subject to VAT, since it is part of industrial costs and is passed on to the consumer in the normal way?

My Lords, when I said in my initial Answer that all other advertising is taxable at the standard rate I thought I was going a long way towards meeting the noble Lord's point.

My Lords, has the Minister made any calculation of the effect of an advertising tax on the receipts of the Treasury from the levies on the independent television companies? Is that not already a substantial tax on advertising?

My Lords, I have not done that because I have not been asked to do so.

My Lords, is my noble friend aware that the majority view throughout the country, I think, would be that people want to see a few of the taxes removed and not one or two more added to the long list of those which we have already?

My Lords, I am sure that my noble friend's sentiment is shared in many quarters.

My Lords, is it not true that,

"He who whispers down a well

About the goods he has to sell

Don't reap the shining silver dollars

Like he who climbs a tree and hollers"?

If that is true, it means that there is a very flexible framework to this industry and there may well be room here for further taxation by Her Majesty's Government, which could then be removed from other, more sensitive, points elsewhere. Therefore, it may well be worthwhile to look further into this matter.

My Lords, I say this in no political sense, but the noble Viscount reminds me of the late Mr. Khrushchev who always had a proverb for every occasion. I should love to have a proverb to cap the noble Viscount's in respect of VAT, but unfortunately I have not come equipped with one.

My Lords, does the noble Earl accept that, of course, I realise that there is a case for advertising? But does he not also agree that every day now, through every letter box, there is evidence, supported by the figures which he has given, that advertising has passed the bounds of moderation? Is there not a case for putting it in a similar tax bracket to tobacco and alcohol?

My Lords, in respect of the first part of the noble Lord's supplementary question, I recognise a fellow sufferer.

My Lords, does the noble Earl the Minister realise that if he puts a further tax on advertising, he may force many newspapers out of existence?

My Lords, I shall note most carefully what the noble Lord. Lord Leatherland, has said.

My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

My Lords, my noble friend's suggestion would give more hours of daylight on spring and autumn afternoons, but it would also mean longer hours of darkness in the mornings in late autumn and winter. The Government do not believe that this would be acceptable to the public generally.

My Lords, is my noble friend aware (I having given her advance notice of my supplementary question in order to make life easier for her) that even by early February it is light by seven o'clock in the morning but dark at half-past four in the afternoon; that such a move would be of great advantage to the building trade in particular and to any firm or persons engaged in business with their counterparts in the Common Market and in Europe, not least financial institutions—

Reading!

and that for most people the earlier end to long dark evenings would be welcome? Lastly, what, pray, might the permanent difference in time actually cost?

My Lords, in answer to the last part of my noble friend's three-part supplementary question, it is quite impossible for me to give the cost in London. However, those who work in the City have no trouble in contacting their European counterparts, and changing to summer time would certainly have no effect on telephonic communication with such countries as the USA and Japan. As for the suggestion that extended summer time would be welcomed by particular groups or industries, successive Governments have seen the present arrangements as probably the best compromise between those who prefer light mornings and those who prefer light evenings.

With regard to that part of my noble friend's supplementary question dealing with making life easier for those who have business or financial dealings with our European partners, if summer time were to extend from February to November we in Britain would be one hour behind Europe from April to September; there would be no time difference in October and November; we would again be one hour behind in December and January; there would be no time difference in the two months February and March; we would lose the benefit of a harmonised starting date for summer time, and it would cause absolute confusion for the international transport industry.

My Lords, does the noble Baroness the Minister recollect a debate which took place on this very subject, initiated by her noble friend, on 24th October last year, when my noble friend Lord Stoddart made an interesting and amusing speech and the noble Baroness the Minister made an interesting and serious speech? Was it not then raised as a matter of importance that there had been many more Post Office workers' accidents when we had an extension of summer time, and did the noble Baroness not then inform the House most usefully that there would be more fuel consumed as a result of that extension, her information coming from the Central Electricity Generating Board?

My Lords, I am most grateful to the noble Lord who by his supplementary question has prevented me from repeating the many answers that I gave on 24th October.

My Lords, may I ask the noble Baroness whether it is not true that anything extra that we import from Europe costs us more money?

My Lords, is it not a fact that if this idea were adopted it would be extremely difficult for the milk industry and very wasteful of effort, and would be altogether a bad thing for British agriculture?

My Lords, I think that it particularly applies to those who keep cattle, because cows' milking times are not elastic.

My Lords, will the Government bear in mind that when British summer time was tried in Scotland on an experimental basis all the year round in the early 'seventies it proved extremely unpopular?

Yes, my Lords, I am aware of that. When the end of that experimental time came, the vote in another place showed how unpopular that experiment had been.

My Lords, does my noble friend agree that for too long the decision on summer time has been based on the effect on cows and the time that they like to be milked, and also on the effect on our friends across the Border in the north? Quite honestly, the population of England is extremely large and I am sure that if a ballot were taken it would show that most people would like to be able to go out after they get home from their office on evenings in the month of March.

My Lords, the Government have absolutely no wish to dictate to anybody in regard to this matter, but I would refer to my last answer to the noble Lady. When this subject was debated in another place there was a massive majority of 366 votes to 81 against the proposal, and this must surely reflect public opinion.

My Lords, is the noble Baroness aware that extended working hours during daylight might at this very moment be very acceptable to another place?

My Lords, I think the noble Lord has a point.

My Lords, does the noble Baroness's answer mean that the Government are determined to keep the public in the dark?

No, my Lords. The Government believe in eternal light.

My Lords, nobles the noble Baroness agree, in view of the considerable confusion which appears to reign on this matter, that it might be valuable to have a Gallup Poll on it, while presumably not allowing the cows a vote?

My Lords, I beg to introduce a Bill to amend Article 3 of the Road Races (Northern Ireland) Order 1977. I beg to move that this Bill be now read a first time.

My Lords, I beg leave to withdraw the Straw and Stubble Burning (Control) Bill. If it is your Lordships' pleasure that it be withdrawn, then it will be immediately introduced for First Reading in the other place by my honourable friend the Member for Thanet. If, by any happy chance, it makes progress there and comes back to your Lordships' House, perhaps after a formal Second Reading your Lordships will have plenty of opportunity to consider it during its other stages. I feel that this is the best way to deal with it in the interests of the Bill; and, at the same time, perhaps it will save us from the experience we had last year of taking a lot of time in discussing the previous Bill only to find that it was killed instantly when it reached the other place. My Lords, I beg to move.

My Lords, I think that my noble friend is asking leave to withdraw his Bill, and not to move.

My Lords, I beg to move the withdrawal of the Bill.

My Lords, I think, again, that is out of order.

Is it your Lordships' pleasure that the said Bill be withdrawn?

rose to call attention to the need for Her Majesty's Government to review the arrangements for the support of the arts, and to consider the future financing of broadcasting; and to move for Papers.

My Lords, may I ask a question?

My Lords, if the noble Lord will permit me to do so, I invite him to come in in a moment. I should just like to finish this thought.

I thought that the noble Earl the Minister answered that charge effectively, as I said just now, in the Observer. But on the other hand, Sir William did his case, and himself, if I may say so, no good in an article in the Sunday Times last Sunday. Such an article would never have been written by any previous chairman of the Arts Council. He uttered theories as though they were facts and blamed everyone in sight other than the Government or the Minister. Even the chairman of his Drama Panel, who has not yet resigned, had to try to undo some of the damage in a letter to the press.

Does the noble Lord, Lord Harmar-Nicholls, wish to intervene?

My Lords, yes. The noble Lord has said that it is generally believed that certain people have become puppets of somebody else. To justify the generalisations that he is now making can he give evidence at this early stage in his speech as to where the powers of independence that the Arts Council has had since it was formed have been in any way reduced or removed?

Yes, indeed, my Lords. It will be the purpose of my speech to do exactly that and, if the noble Lord will control himself, I shall hope to convince him during the course of the next few minutes.

It seems to me that the situation is complicated by the Arts Council's adoption of the dirigiste plan called, or rather miscalled, the Glory of the Garden. Hitherto shortage of money—there has often been shortage of money—has been met by a general tightening of belts which may have been unwelcome but was at least not felt to be unfair. This time planned development is to be persisted in so far as possible even though the money to implement it is not there, and the cash is to be found by robbing Peter to pay Paul. Peter, of course, objects strongly to that.

The Minister cares about the arts. I have no doubt of that. But his economic beliefs seem to me to win every time. What possible excuse can there be for a situation in which any opera in any German city of any size now commands twice as much support from the state as does, for example, the English National Opera alone? In West Germany the arts budget is many times ours, while our defence budget equally multiplies theirs. Why should we be up to our necks in nuclear weaponry if we cannot afford to spend anything approaching the amount that they spend on the arts and on entertainment? I do not recall that being among our war aims.

The arts here, and indeed elsewhere as we shall see, are in special difficulty because of their inevitably high inflation rate. It is much higher than the norm, and I think the Government make a mistake by presuming the existence of an average inflation rate which is supposed to apply to everybody. It does not. Individuals' inflation rates vary very widely and so do those of organisations. The arts are in special difficulty for the reason that they have a very high inflation rate. If the noble Earl the Minister has any doubt about that, may I commend him once again to the work of Baumol and Bowen on the economics of entertainment and the arts.

I am not entirely giving up the Minister. I have not abandoned hope of him. His predecessor, Mr. Channon, asked Mr. Clive Priestley to examine the Royal Shakespeare Company and the Royal Opera House on their financial affairs. Mr. Priestley came up with the answer we all expected; all except, apparently, the Government. He said that the two institutions are well managed but under-funded. To his credit the Minister, who by now was the noble Earl, acted on the report. Good! He found those organisations a substantial additional sum of money, as was recommended by Mr. Priestley. But the reason that many of us knew the answer before the event was that previous Government reports have always come up with it without exception. The arts generally are well managed in this country but are badly under-funded. If Mr. Priestley had examined the National Theatre or the English National Opera or any other pair of institutions inside or outside London it is highly likely that he would have come up with a very similar answer.

Why should the National Theatre or any other theatre be penalised because it was not lucky enough to be selected for examination? The Government and the Arts Council together seem to have combined to threaten the existence of the Cottesloe. I am delighted to see that the noble Lord, Lord Cottesloe, will be speaking later in this debate and hope that he will say a word (I am sure he will) about the theatre which so rightly carried his name.

The Cottesloe is one of the most creative theatrical spaces in the world but apparently, because the National Theatre has to carry a £2 million burden of maintaining its own building—which makes the theatre appear to be much more expensive than it actually is in production terms—then the National is to be penalised.

The current grant, which is actually below the average rate of inflation, constitutes a savage cut, which will prevent the National Theatre from undertaking touring. It is very important that it should tour because it should not be a theatre that exists only in London; it is one that ought to be seen in all parts of the country. That facility will now be lost. This affects not only the Cottesloe, because theatres in other parts of the country are also in danger.

If the money is so desperately short then I have a question to put to the Minister concerning the internal distribution of money in the arts. Is this the right time to spend £1½ million on acquiring a picture by Joseph Wright of Derby? Why was the price so high? Who made that decision, which has been criticised? Even if money were plentiful, there are those who would doubt the purchase at that price. At a time of such violent shortage of money, causing artistic enterprises to limit themselves and to close all over the country, it seems hard indeed to justify that kind of expenditure.

My Lords, as the noble Lord has put that question to me directly now, perhaps I may answer while it is fresh in everyone's mind. Is not the noble Lord wholly vindicating the continued existence of the arm's length principle? I had nothing to do with that decision and I was not consulted.

No, it is quite true, my Lords; but at the same time it is true also, I think, that a number of people are beginning to wonder about the general operation of the system we currently have for the purchase of works of art. There is a strong feeling that the state organisations are being exploited. I suggest that, as part of the examination I am proposing to the Minister in this Motion, one matter which ought to come under scrutiny is the operation of that system. Not its operation in any particular case, necessarily (or in the particular case I have mentioned)—but the question should be asked: how are such decisions made? Are prices being artificially inflated? Is the state getting value for money? I suspect that if there is one aspect of the arts that ought to be examined carefully, it is this one.

The high internal inflation rate in the arts means that since the Government have been in office, and although subsidy has covered the average inflation rate (as I am sure the noble Earl the Minister will be telling us in a moment), the arts in general and the performing arts in particular have had to draw their belts tighter, and tighter every year. Anyone with personal experience of theatre finance will know this to be true. This year in particular is a disaster.

The Minister says, "O.K., I know you're hard up, but you'll have to get more money out of business. Furthermore, if you succeed, I will reward you with a further state subsidy". So to him that getteth shall be given. There are some organisations which can take advantage of that situation; for example, theatres in the relatively prosperous south. Elsewhere, business sponsorship becomes much more difficult, and sometimes quite impossible. In general, the greater the theatrical need, and the more basic the requirement, the more difficult it is to raise business subsidy—particularly north of Watford.

The Minister will know that I am far from opposed to business sponsorship in principle. Indeed, when I was Minister I started the Association for Business Sponsorship in the Arts with my noble friend Lord Goodman as chairman and a grant of public money to get it going. I confess that I sometimes wake in the night with the thought that I may also indirectly have started Mr. Luke Rittner—who was the first director of ABSA—on his meteoric rise to power or, rather, to responsibility.

The home of private and business subsidy is, of course, the United States, but the Americans are in serious trouble with it. A recent Twentieth Century Fund Report, Patrons Despite Themselves, published by the New York University Press, suggests that even in that wealthy country, the cost of private and business support in terms of tax revenue lost has been so great that many feel now that direct support by the Government, federal authorities, state and city is both cheaper and more efficient. But they are in real trouble in trying to switch to what they regard as the British system.

According to the latest report from the Theatre Communications Group of New York, both public and private subsidy in the United States has failed to match rising costs. The Minister may tell clients of the Arts Council to try business sponsorship, but he may not be quite so helpful as he thinks he is being. In the United States, 30 theatres have been forced to close because of their excessive reliance on that type of sponsorship. Ultimately the state is responsible, and that is a better source of money for the arts, and a more reliable source of money, than any other.

What can we do? We can do something we have never done and consider the structure of Government support for the arts and of the media as a whole. The nearest approach ever made to a comprehensive look at the scene was the 1966 White Paper, A Policy for the Arts: The First Step. That splendid document has never been fully implemented. My own attempts to do so in my two years as Minister were by no means universally popular nor entirely successful. I regret the absence of my noble friend Lady Lee, because it would be delightful to have the wonderful double act of Lee and Goodman performing here this afternoon. Unhappily, neither of them—for reasons of health or mobility—is able to be with us. However, that White Paper pointed in the right direction. Because it went way beyond the traditional fields of the arts, it was put in the name of the then Prime Minister, now my noble friend Lord Wilson of Rievaulx—although it was popularly and rightly known as Jennie Lee's White Paper.

In relation to the government of the arts, that White Paper called for generosity, imagination and coherence. The generosity has been patchy, the imagination limited and the coherence non-existent. In the absence of those qualities, the Arts Council has become more and more bureaucratic. As I said earlier, the council's advisory panel has been deprived of standing and authority, and attempts to build any influence were resisted. So the Arts Council has changed. It was the standard bearer of its beneficiaries, but today it seems to be the messenger of government.

I hope that I am wrong in that belief but it will be put to the test. As chairman of the Theatres Advisory Council I have invited the Arts Council to join in a combined approach to the Minister. If the Arts Council accepts, we shall know that it still preserves elements of the independent existence it once enjoyed. If it refuses, we shall draw our own conclusions.

The Motion refers to broadcasting, which subject I shall leave very largely to other speakers—as I shall have many other matters I should like to take up, such as literature and museums. I know that in theory there is an unlimited time before me but it occurs to me that if I were to take advantage of that theory I should make myself extremely unpopular—and I am not anxious to do that any more than is absolutely necessary.

I should, however, like to say a few words about television. We have a system that responds to two separate demands. On the one hand, there is the demand for quality emanating from the Act of Parliament and implicit in the licensing system. On the other hand, there is the demand for popularity emanating from the sources of advertising finance for the other network. These two demands condition each other, and quality and popularity are to be found on all channels. Human nature being what it is, some real stinkers are to be found on all channels. But the action and interaction of these two systems together is the strength of our television system. For that reason I am wholly opposed to the idea of the introduction of advertising on the BBC which has been put forward in another place by my honourable friend Mr. Joe Ashton. That opposition to advertising on the BBC is the policy not only of myself but of my party.

To sum up, the purpose of this Motion and my interest in moving it is to press the Minister and the Government, first, to reconsider their current grants and to give the Arts Council an immediate supplementary grant large enough to prevent the closures which threaten, and to maintain the high quality we have grown to expect; and, secondly, to set up an inquiry into the whole system of Government relationships in the arts and in the media with a view of recovering something of the three principles enunciated 20 years ago. Jennie Lee, as she then was, called them "generosity, imagination and coherence." The key to that recovery is to roll back centralism, to rediscover the virtues of pluralism, to enable local authorities to play their proper role without penalising and handicapping them at every turn, and above all to recall that the Prime Minister pledged her Government in the beginning not to introduce precisely those "candle-end economies" they are now enforcing in the very field in which this country has hitherto stood so high in the world.

My Lord, before the noble Lord sits down, may I ask him why he did not keep his promise to me of 18 minutes ago, when he said that he would produce evidence to justify that the Arts Council had lost the independance granted to it when it was set up, and to justify his charge of the council being puppets, and such phrases as that?

My Lords, I should have thought that the resignation of seven members of the Arts Councils' drama panel and the uncertainty as to whether any of the other panels consider it worthwhile was sufficient evidence of the proposition, which is widely held in the Council, that the situation has changed, that the Minister responds to the Cabinet, the Cabinet responds to the chairman and the chairman hands onto Mr. Luke Rittner who represents it. The point here is this. It is not whether or not this accusation is true but that it is widely held and generally believed throughout the Arts Council. My Lords, I beg to move for Papers.

My Lords, there is a moment familiar to all opera lovers when some admirable figure like Sir John Tooley comes on in front of the curtain and says that the tenor has a cold. In this case, I have no such admirable representative. I simply apologise in advance to your Lordships for my voice. I may have to interrupt my remarks briefly to take Day Nurse from time to time.

That said, I am glad to say that my condition does not apply to the arts. They are alive and kicking in Britain. I know that because I am getting quite a lot of the kicking. I welcome this further proof of their vitality, just as I welcome today's debate. It gives me the chance to draw attention to a number of things—to the liveliness of our artistic landscape and the range of achievement of those who occupy it. It gives me the chance to draw attention to the Government's role as well as considering or answering any criticisms that may be made when I come, if given leave, to wind up. It gives me the chance to rebut altogether some of the loaded and partial accusations we have heard from the noble Lord, Lord Jenkins, today and, recently, from one or two others outside. I want to leave this House in no doubt whatever as to the Government's commitment to the arts; or to our conviction that the best way to serve the arts is to urge other individuals and organisations to share that commitment and add to it.

The arts belong to the whole nation and sustaining them financially means encouraging a plurality of sources, public and private, local and central: the virtue of pluralism, as the noble Lord, Lord Jenkins, eloquently put it. I also welcome the chance to draw attention to broadcasting issues. Within the Government these are not my direct responsibility but they have a direct bearing on the arts which are my responsibility. In order not to be too long in opening I propose to deal with broadcasting more fully when I come to wind up. So, with all my differences with the noble Lord, Lord Jenkins, I welcome the debate and congratulate him on it, and I look forward to learning a lot from it.

Let me start by praising famous men and women: the people who will define our period of history long after we are gone. Any tour of the horizon is necessarily partial and subjective, and noble Lords will have their own additions or subtractions. I take our traditional strengths in literature and drama. Mainstream dramatic writing—the kind which is helping to keep the commercial theatres alight all over the country, but in the capital especially—is very strong at present. Some very high brows, like those of Messrs. Bennett, Stoppard, Ayckbourn and Frayn do not disdain to keep those of us in the middling range of brow provoked and amused. We have a cousinly relationship with the genius of Mr. Samuel Beckett—the only Nobel Prizeman to appear in Wisden which I, as a fellow Dubliner, rather relish. Also forceful, across the Channel in Paris is another genius of the theatre, our man Mr. Peter Brooke. When I was young our actors knew rather more about talking than moving. Mr. Brooke changed all that.

Here at home let me praise the directorial talents of Miss Glen Walford whose Romeo and Juliet at the Liverpool Everyman was to me the real renaissance Shakespearean thing. Or let me praise, quite unconditionally, Sir Peter Hall—even if I feel that his talents for politics match my artistic talents. It is pointless for me to name our actors and actresses. They are simply the best anywhere and people come from all over the world to see them. Mr. Golding has deservedly won the Nobel Prize. Mr. Greene, undeservedly, has not. Mr. Powell or Mr. Naipaul, in my view, could easily qualify. Mr. Amis, pére, is writing like Swift at the moment and Mr. Amis, fils, is writing extraordinary novels which are really prose poems like Joyce. Mr. Larkin is as good in the narrow lane as Housman. Mr. Hughes will be an astonishing laureate, even as we still mourn Sir John Betjeman. There is a variety of big and little cheeses—local but prized elsewhere, as Auden said poets should be: I, for one, love Mr. Bunting, Mr. Nicholson, Mr. Hill, Mr. Sisson (who used to be an assistant secretary in my first department) and Mr. Heathcote Williams. Who writes better in their fields than Mr. Dick Francis, Miss P. D. James or Mr. Le Carre? Who is odder or more original than Mr. Michael Moorcroft or Mr. Russell Hoban?

In music, one of my problems is a provision in this country so rich as to be difficult to sustain. Countries with a supposedly greater musical tradition than ours concentrate resources on rather fewer orchestras. Aside from London's five major orchestras—not to mention the London Sinfonietta whose funding, I am glad to say, has been increased substantially, or the Academy of St. Martin's in the Fields—Mr. Simon Rattle is turning the City of Birmingham Symphony Orchestra into one of the great orchestras of the world. That is why so many other orchestras in the world are trying to pinch him. Without making a song and dance about rate capping, the Birmingham City Council helps us cherish that orchestra, as so it should.

We have lost Lord Britten, but we have Sir Michael Tippett, and Mr. Brendel has chosen to live among us. The marvellous European Chamber Orchestra has a majority of British players, all of them young, and works without a penny of subsidy; congratulations to Mr. Peter Readman for showing, as has Sir George Christie at Glyndebourne, that it can still be done. The Royal Opera House, the English National Opera and the Welsh National Opera operate in world class with, by world standards, a very modest level of subsidy. We have increased the subsidy for each of them, as well as for the Scottish National Opera, and I shall go on doing my best. We have a great and living tradition of church music, major musical festivals such as Edinburgh and Aldeburgh, and thousands of dedicated orchestral players who usually work much below the average industrial wage.

At rather higher than the average industrial wage our pop musicians have cornered 25 per cent. of the American market. Recently their efforts and the promotional skills of Mr. Bob Geldof made a significant impact on the Ethiopian tragedy. Popular musical and dance theatre is doing scarcely less well. Mr. Lloyd Webber's talents are enriching the London theatrical heritage as well as himself.

The hotline between the subsidised and unsubsidised worlds of our truly mixed economy where the arts are concerned is very evident in dance. For some time I have thought that if I could wave a wand, I should see that our dancers were better paid. No group since the Beatles has electrified me more than the London Contemporary Dance Theatre, and I urge your Lordships to patronise it. I was delighted to learn that raising the wages of dancers in the regions is one of the priorities adopted by the Arts Council.

I have to say that I sometimes feel less a Minister for the Arts than the Minister for those who administer the performing arts. Inevitably, these sop up most of the monies available all over the country. Our painters, by contrast, are rather more honoured abroad than at home. Dare I say that the British establishment is perhaps musico-literary rather then visual? We have allowed terrible things to happen to the appearance of our cities and thence, for aesthetics are also economics, to the lives of many who live in them. But that is not the fault of our artists.

I am hopeful that the Metropolitan Museum in New York will succeed in arranging over the next year or so a show of British painting to remind that great world centre that there is more to British art than the towering acknowledged reputations of Mr. Moore, Mr. Bacon, Mr. Freud, Mr. Hockney and the American expatriate, Mr. Kitaj. There is the sculptor Mr. John Davies, for example, and there are the paintings of Miss Thérèse Oulton and Mr. Adrian Wiszniewski, who are still in their twenties, or even early twenties.

My Lords, the noble Earl is giving us a wonderful history and a list of all the artistic achievements in the country. I hope that he is not personally taking responsibility for all of them. Any of us could do that, though possibly not as well as he has. But when will he get down to the question of the Government's responsibility for what is very likely to happen in the immediate future?

My Lords, it is an essential part of my thesis, my philosophy and my personal beliefs that Governments have very little responsibility in the fields of artistic genius.

Given another wand, I should wave it over film. As the Minister responsible for the British Film Institute, rather than for the highly successful British film industry, I should dearly like to be in a position to join others in helping it increase its low-budget productions and helping such talents as Mr. Derek Jarman's. Here the present funds available from the broadcasting authorities are very important, and I salute Channel 4 and the IBA companies which fund it for their efforts. I also congratulate the BFI on its success in obtaining no less than £5 million in private donations and without any help whatsoever in that respect from me.

This perhaps more directly answers the noble Lord, Lord Jenkins, than I did previously. I could of course spend all my allotted time on a catalogue of praise and commendation for one of our most successful and dynamic industries, because that is what we really mean by the arts in Britain. They earn millions of pounds for the country at home and abroad and employ hundreds of thousands of people. Mostly they do it without subsidy. Subsidy is very important, both central and local, in terms of public funds. I am committed to maintain it and I have done so—indeed, I have done a little better than that—where central Government is concerned. But inevitably the very success and dynamism of the arts industry has led its supporting lobbies and organisations to ask for rather more than the Government can reasonably provide.

Let me now look at what we provide and suggest to your Lordships ways in which we can augment it. My Ministry's central expenditure programme under this Government has increased from £124 million in 1978–79 to £272 million in 1985–86. This is an increase in real terms of 18 per cent. Even in this year—which I have acknowledged will be a tight year for many arts bodies—the overall increase will be just under 6 per cent., which is more than the predicted out-turn of inflation and more than the present inflation rate. It is irresponsible rubbish for Sir Peter Hall and others to say that year on year arts subsidies are being reduced or that our system of state support is being dismantled.

We sometimes hear, as we have heard from the noble Lord, Lord Jenkins, today, that other nations spend substantially more per head on the arts than does Great Britain. Such comparisons ignore fundamental differences in the way such spending is accounted. For instance—and I think that this is particularly pertinent to today's debate—through the broadcasting licence fee and the commercial TV licensing system, a further £250 million is spent on the arts, which, if it were added to my programme, would double it. Most countries count this as public spending; we do not.

We are apt also to ignore the fact that France and Germany are substantially richer countries than we are. They used to be substantially poorer. We are doing better now. We are going to have to do better still. Of course I envy my French colleague and personal friend, Jack Lang, for having a budget of getting on for a billion pounds, if one includes broadcasting. He envies me the products of British culture and their marketability in an increasingly English-speaking world. Even a fanatic francophile such as myself must admit that our artistic returns for public monies are superior to those of France. That is why I am determined to protect the subsidies.

It is also said that the monies spent on arts are too small to have significant macro-economic effects. So they are, which is again why, over a period when control of public spending and borrowing is the Government's paramount aim, they have been increased. But substantial upratings of the kind which would avoid difficult choices between one region and another, one art form and another, or one art body and another would of course have profound macro-economic effects. It really would be an extraordinary signal to other areas of the public sector if the arts were to receive a substantial and a unique uprating. It would be seen, and in my judgment rightly, as the professional middle-classes promoting an area of the welfare state especially attactive to themselves, while squeezing other services.

The previous Government also had to wrestle with such considerations, and I pay tribute to my predecessors, the noble Lords, Lord Jenkins and Lord Donaldson, for their efforts on behalf of the arts. But the result of their efforts is very similar to the record of my own immediate predecessors and myself. Where this Government have shown themselves more successful is not in the energies of their art Ministers but in sustaining higher levels of economic growth with lower levels of inflation. That must go on if the arts budget—like the other things we value in our society and want taxpayers to help pay for—is to be maintained, let alone to grow.

I sometimes think that part of the reason the arts lobby demands substantial increases each year is that it may not yet have taken in the fact that inflation is no longer running at the alarming levels of the 1970s and early 1980s and that therefore apparently very modest percentage uplifts can still mean real growth.

Sir Peter Hall has led the attack on the Arts Council, on this Government and myself. It is his right to do so. Nevertheless I do not feel that he is the best qualified person. With £6·7 million annually the National Theatre remains Britain's best funded theatre. I know many directors up and down the land who would like to have that budget and Sir Peter's terms and conditions of employment. I am very sad at the suggested closure of the Cottesloe.

May I say that, contrary to a report in one paper, I gave early advice—the moment I knew—to my noble friend. However, I am very contemptuous of the GLC, not of its proposal to give it additional support, which I would welcome, but of the blatantly political shenanigans—how else can one explain the contradictions?—over the terms of this and other aspects of its arts policy. Like many of your Lordships, I have strong political views, but I have tried and I will continue to try to run my arts Ministry as ecumenically as I can. The GLC's mischief is to make rescue conditional on rate capping not going ahead. Conversely, it has threatened to cut its general arts grant by up to £20 million if it is rate capped. Yet it could have gone a long way towards avoiding this. It could have applied for a derogation for its grants to charitable bodies, including arts institutions. But it has not done so. Sir Peter has himself recognised the GLC's political manipulation of the arts. As he said in the Guardian on 18th January,

"Their present policy is to wreck them".

As to the accusation that Sir William Rees-Mogg is my puppet, the noble Lord, Lord Jenkins, was kind enough to say that I answered this adequately in the Observer. It really is a daft and rather insulting idea. Sir William Rees-Mogg is an immensely intelligent and heavyweight public figure. If there is to be influence, it is much more likely to be his influencing me than the other way round.

Thank goodness the proposed abolition of the GLC and the metropolitan councils offers us the opportunity of a way out of this and similar political manipulations and accusations. I am very glad to have this opportunity to repeat my commitment to the arts and museums following local government reorganisation. The Government will make available £34 million in additional central funding for England in 1986–87 and equivalent sums in later years. The Arts Council will itself take over the site and buildings of the South Bank, so it can be administered in a cost-effective way as a single entity. I beg your Lordships not to confuse the financial problems of the arts and of artists—which are very real and which step by step we shall try to ameliorate—with the problems of the organisations which serve them. These may be no less real, but I suggest they are slightly less important.

Reducing administrative costs is one of my other jobs in this Government. It is essential that every step of the way we obtain the maximum value for every pound that we spend. I am delighted that the noble Lord, Lord Jenkins, appeared to endorse that. I think that is the measure of our sincerity and our commitment to the things we value. For instance, dare I ask—and I ask fully at arm's length—does the National Theatre really need more than 50 permanent designers anyway? It may be that it does, but I think it is a question that can be asked. As a believer in plural funding I recognise the immense contribution made by local government to the maintenance of our artistic estate and heritage. Of course it is true that we are putting pressure on local government to engage in the painful business of bringing their spending under control, just as we have engaged in the painful, and still painful, business of getting our spending under control. Of course it is a nasty and painful matter. But it is essential if the burdens on the wealth-creating sections of the economy—on which, after all, all the public services depend—are to be lightened. The overall level of arts funding is not by itself high enough to put authorities in any danger of penalty. Even in the GLC and metropolitan county areas it is about one over seventeen hundred of their total expenditure.

Saying, "Oh, we can't support the arts because of rate-capping", is almost as foolish as if I were to say here, "Oh, I cannot try to mend the roof of the V & A because of the effects that so doing might have on sterling". "Where there's a will, there's a way." And as to the political will, the same arguments on the economic as well as the moral benefits of the arts apply to local as to central Government. We must both continue to do our bit.

I am glad to learn from the Arts Council that all the signs now are that the majority of local authorities are responding magnificently to the Arts Council's challenge to them to provide additional funding for matching purposes. Of course, I accept that, given the interest and excitement being generated by artists of the calibre that I mentioned in my opening remarks, my bit may not be enough. I shall try to improve it. We are looking further at tax incentives in line with our manifesto commitment,

"To examine ways of using the tax system to encourage further growth in private support.".

In good earnest of my desire to do better—or, in more vulgar language, to put my money where my mouth is—let me make a new commitment today which I believe will be helpful and which I hope will encourage others. At a time when public support will be maintained rather than increased, in real terms, private support holds the key to expansion. Therefore it is not a substitute for public subsidy but a most important addition to it. There are many instances of arts events which would not have taken place without sponsorship: the RSC's tour of the North, sponsored by National Westminster Bank and Olivetti's fabulous Treasures of San Marco exhibition at the British Museum are just two examples, and I have many more here—the bulk of them north of Watford, I am glad to tell the noble Lord, Lord Jenkins. Business sponsorship has risen from £½ million in 1976—and all credit to him for his efforts to get it going—to £15 million last year. I want the trend to continue.

Last October I launched my business sponsorship incentive scheme. It was aimed at keeping the upward momentum going by offering an incentive to attract new business sponsors and to encourage existing sponsors to increase their commitment. I have used £½ million of my budget during its first six months to make awards on a £1 for £3 basis to arts bodies who raised new sponsorship. As an experiment, this has been a runaway success. I am delighted to say that at the end of the first half year I shall have announced awards in excess of £2½ million of new sponsorship. I pay tribute to the Association for Business Sponsorship of the Arts and Mr. Tweedy, who so successfully administered the scheme. I now want to go on and make the scheme even more attractive to small and medium-sized businesses who have never before tried sponsorship.

From 1st April I shall be introducing a special bonus offer for first-time sponsors. Under this I shall offer matching grants—pound for pound—for new sponsorship over £1,000 for companies who have not sponsored before. I hope that by encouraging companies in this way to dip their toes into sponsorship for the first time, they will be converted to the benefits they can derive from it. I believe that they will then continue to sponsor in future years.

I have also been persuaded that the present qualifying limit for the scheme of £7,500 is too high to attract additional sponsorship from many existing sponsors. I have therefore decided to reduce that limit to £3,000 for them. The present awards at £1 for £3 will continue for existing sponsors and for new sponsorships after their first year. In both cases the upper limit of £25,000 on the Government contribution will continue. I am convinced that both these changes will attract more sponsorship money for the arts and that many more arts bodies will be encouraged to go after sponsorship in a businesslike way with this added inducement. We must have a mixed economy, a plurality of funding, in the arts as elsewhere.

Much of this debate will doubtless concentrate on the performing arts and on broadcasting. But they are by no means the only areas where there have been major developments in recent years. As I have already said, there have been impressive achievements in film and in the visual arts. To underline the point, taking commercial films alone there are, besides the earlier success of "Ghandi" and "Chariots of Fire", no less than seven Hollywood Oscar nominations for Mr. Puttman's "Killing Fields" and eleven for Sir David Lean's "Passage to India" this year. In crafts, we have witnessed the quite extraordinary spectacle of Japanese purchasers outbidding each other for the work of contemporary British potters. Why is there not more of this kind of thing in the papers and less about the inevitable lobbying and wrangling of organisations?

Why not more about the 40 per cent. increase this year to authors through public lending right and less about the no doubt real operational and organisational difficulties of the Arts Council's literature or drama panels? The latter is wholly a matter for the Arts Council, and not altogether to do with issues that affect artists. I sometimes think our national symbol should not be the lion but Eeyore, A. A. Milne's immortally gloomy donkey. I am glad to have been able to give a modest increase to the Crafts Council this year.

Let me close by mentioning briefly museums and the heritage. When I first became Minister a great deal of play was made with the postponement of the Theatre Museum. Thanks to my own lack of shame as a sponger, and the infinitely more laudable tolerance and generosity of a private donor, the postponement was postponed. The building work is still going forward. It should be completed next year, and the opening date will then be a matter for the Victoria and Albert trustees. Just as the Arts Council has had its priorities, notably regional development—and, in passing, I should like to say to any sceptics like Mr. Sutcliffe in the Guardian today that, although the figures have yet to be finalised, a number of regional companies will receive a substantial increase when the Arts Council makes its next announcement, I understand—so I have had my priorities in the museum field.

These are the housing, conservation and display of our existing collections. Nearly £10 million will still be provided for new purchases. I acknowledge that, given today's art prices, this is little enough. But we have by far the greatest range, quality and stock of works of art in public hands of any country in the world. Their accessibility and display has for long been a national and international disgrace. I am determined to reverse the trend. As to the heritage, Belton House, Calke Abbey and most recently the proposals for Weston Park, Nostell Priory and Kedleston speak for themselves. These are not nostalgic architectural memorials for a vanished, aristocratic age, but living and developing assets. In the case of Nostell Priory—and how much we all owe to the devotion of its previous owner, my late and much missed noble friend Lord Saint Oswald!—we have a shrine to the work of perhaps our greatest artist craftsman, Thomas Chippendale. All these are a great and permanent tribute to the Government generally, and in particular to my right honourable friend Mr. Jenkin, and to the work of the National Heritage Memorial Fund. I should like to pay especial tribute to the noble Lord, Lord Charteris, and to the able assistance he receives from my noble friend Lady Airey. We should let the trumpet sound rather more often.

Saying this is common sense, rather than complacency. I am very aware—acutely aware—of the straitened circumstances of many individual artists and arts bodies. I will visit and listen and help and fight all I can, but as culture Minister it is, I am afraid, also my duty to deliver something of a culture shock. The party is not over, but the limits of hospitality have been reached. From now on, central government funding will remain broadly level in real terms. This should cause neither histrionics nor despair. With the great majority of local authorities, whatever their political colouring, I am confident that good sense and enlightened self-interest will prevail. Where it does not, the arts should lobby ratepayers and voters as well as ourselves.

Out there in the real economy, real growth is taking place. Consumer spending is up; even a small extra share will mean great gains for the arts. Business sponsorship is sharply up, and my announcement today should push it further in the right direction. I shall listen to the debate with the greatest care and humility. But I do urge your Lordships, and not just for my own sake, to approach these issues in the robust spirit of all hands to the pump rather than dropping the pilot. Like the pianist, who should also, in my partial view, not be shot, he is doing his best, and if you give him a little time he may surprise your Lordships yet.

My Lords, before the noble Earl the Minister sits down, will he forgive an intervention from one who is, and who has been for many years, a member of the National Theatre board? Does the noble Earl the Minister think it consistent with his usual dignity and fairness to make a reference in public to the terms and conditions of the service of Sir Peter Hall and a criticism of 50 designers, thereby implying extravagance, when, in private, every communication received by the National Theatre board from the Minister and from the Arts Council has praised their economic way of running their theatre and not one word of criticism along the lines that he suggests has ever been made?

My Lords, I have praised Sir Peter Hall and, indeed, the National Theatre's productions and its management both in public and in private. What I said in my speech was that it seemed to me that the terms and conditions under which the National Theatre operated, including its director, were quite reasonably favourable, that many others would like them, and that it was at least part of the legitimate public debate to ask some questions about the staffing levels, and so on, at the National Theatre. I have also not noticed Sir Peter Hall's reticence in public on these issues, and I do not see why I should sit on my own hands.

My Lords, I wish to begin by saying that the noble Earl is a friend whom I admire and a political opponent of whom I am wary. When preparing for this debate I received messages of gloom, uncertainty, discomfort and worry from all over the country and from all over London. I said to myself, "How is he going to handle this debate?" I then said to myself, "There is only one way he can handle it: he will have to brazen it out". And brazen it out the noble Earl has, with some very elegant brass! He has told us of some of the glories that exist and that are at risk today, we having built them up since the war with elaborate work and immense Government subsidies, constantly increasing. One way or another, he seems to me to have avoided the situation, which really is very difficult.

The noble Earl paints a picture as if everything in the garden is lovely. I can assure your Lordships that it is not. It is not only not lovely: it is in a very nasty situation. I shall produce a certain amount of evidence which I hope will paint a rather different picture—not a picture that will not welcome the few crumbs that he gave (every crumb is welcome) but one which will be rather different.

I am grateful to the noble Lord, Lord Jenkins, for opening this debate. I am sorry that we had to include broadcasting because, like him, I do not want to speak about it, and I think the arts are in sufficient trouble to deserve the whole debate to themselves. I shall make only one personal observation. I loathe advertisements on television. I think they wreck the continuity that one gets from the occasional good film or play. Like two black crows, even if they were good, I should not like them. I am glad to know that commercially as well as culturally it is probably going to be almost impossible to share the advertising any further because the people who are paying for it are not ready to extend any more advertising than they are doing already; so I hope the whole thing will be dropped.

This really is a sad day for all of us, in spite of anything the noble Earl may say. It seems to me to mark a turning point in the development of the arts in the United Kingdom—an abrupt turning away from the steady effort of successive Governments to support artistic endeavour and opportunity of all kinds, and to spread it wide; an effort frequently, it is fair to say, frustrated by the native philistinism traditional in this country, but a real and largely successful effort, nevertheless. Now we see—or I think I see; the noble Earl will of course deny it, but I think I see, and many of us think we see—the deliberate first steps towards the dismantling of the whole structure of the support for the arts which has been so painstakingly built up step by step, Government by Government, since the war, and quite irrespective of party. It has been the task of Government, led by the Minister for the Arts, to lead public opinion towards an ever less grudging and even more appreciative attitude to the arts. Now I detect that we find ourselves going into reverse.

It is sad for me, too, as for six years I have nobly restrained myself from making serious attacks against my three successors as Minister for the Arts, on the grounds that I knew very well what they were up against and how much more difficult it must have been for them than for my right honourable friend Shirley Williams and me to extract anything from their much more philistine Cabinet. Tory Governments always lead us on with hope and then disappoint us.

I was delighted when I saw that the Minister for the Arts was to be made a member of the Cabinet. I thought the Tories were taking the arts seriously. But I was quickly disillusioned when I saw that he was to be given other things to do, of much greater political importance. The first incumbent was made Leader of the House—one of the most exacting jobs in government. The second was put in charge of the Civil Service—something less than a rest cure in itself. Now the noble Earl has to do that, and, added to it, is saddled with the uphill task of trying to defend in your Lordships' House the singularly unsuccessful financial policies of the Government. He carries out this task with great ability and great charm, but, to me, unconvincingly.

It is sad for me, too, because I have spent much of my life benefiting from, and some of my life helping to administer, some sections of the arts in this country. I have made friends and have grown in admiration of those who work among them. I suppose the worst thing is that the noble Earl is now obliged to override his duty to the arts, which I think we all see as the duty to fight hard to get for them as large a share as possible from current available funds, by his new and politically much more important duty, as a spokesman for the financial team, to help them reduce expenditure in every possible way overall, regardless of what suffers in the course of it. In other words, he is at war with himself, and the Bible tells us what that leads to. Be that as it may. It is the policy, not the man, which we need to attack.

First, let me give credit where credit is due. The noble Earl has given us a most useful addition to the money for PLR. This cannot have been easy to do and is much to his credit. Secondly, the Government, pressed no doubt by him, have, as he has just reminded us, responded generously to the British heritage side of things by putting up £25 million for Kedleston. When we were discussing the heritage in my day we always said that no annual grant could possibly deal with major historic houses coming on to the market; they would have to be dealt with by decision of the Government of the day, on the spot. I congratulate the Government on having made the right decision for Kedleston.

That is as far as praise can go. Looking around the whole structure of the arts support, as we shall be doing in this debate, I fear that we shall find from many directions gloom verging on despair. I think most noble Lords will mention specific instances of problems and difficulties. I want to refer to what I regard as the wrong-headed plan to cut the centre to help the periphery. Of course the right thing is to help the periphery without cutting the centre, and if that needs more money, I shamelessly say that we must have more money. One had thought that that wrongheaded plan would at least do some good to the periphery. I have inquired from all the regional arts associations. A number of them have had the decency to answer me, at very short notice, and it is clear that they are far from happy.

The theme which runs through most of their comments is that they have been under-recouped, in relation to inflation, for their running costs, leaving them unable to support satisfactorily their existing obligations; but at the same time, under the Arts Council Challenge Funding Scheme, they have been allotted modest funds which they are not allowed to use on the things they have been doing but must use on something new. As a result, a number of existing schemes have run into trouble and the whole atmosphere has gone wrong. They feel that, in hard times, they should spend their money strengthening what they have already started and supported and not letting this down flat and looking round to build something new. I agree with them.

They have been told that the local authorities must look after the local arts and that no more will come from the centre, except for ventures of more than local importance. They fear that rate capping and the change in the metropolitan councils will leave them short in all directions, and they think this in spite of the figures which the noble Earl has given us for the amount that he is putting aside to deal with that. I think they are right, and I think it is true, too, in the London metropolitan area. Not one who has so far replied to me shows any confidence in the future. In particular, it seems to me that the regional and local museums and galleries, which have no national support, are bound to suffer from rate capping and other pressures on the local authority funds. Now that the universities themselves are under such savage attack the poor university museums, including some of the nation's finest collections, will suffer more than anyone, as, alas, they always seem to do.

Libraries all round the country are complaining bitterly, and the National Book League survey for last year shows a 19 per cent. drop in book funds since 1979, while the libraries themselves show a 6·4 per cent. reduction in staff. They feel under severe threat as the tightness of money among local authorities causes easy savings to be ruthlessly exploited; and books are always easy savings, as all you have to do is not order them. There are smaller issues, too, which are serious. One is the archaeological services run by the metropolitan counties, for which no replacement has as yet been indicated. It is a smallish matter—only about £500,000—but a vital one, nevertheless.

I have had very helpful letters from all over the country. They were written at short notice, and I appreciate very much the response. I cannot possibly refer to them all, but I think I have said enough to show that a quick look outside London does not suggest that cutting the centre has done the provinces much good. It has certainly done the centre grievous harm.

I ceased to be a director of the two opera houses more than 10 years ago, but I am still in close touch and I can assure the House that in an association lasting nearly 30 years I have never found the administrations so down in the dumps. Both have to cut new productions, and, worse, both fear that they will have to do so again next year and probably the year after as well. New productions are the life-blood of any opera house, and a long-term programme of this kind really leads to death.

Covent Garden is particularly bitter, having been exhaustively examined by the Priestley Report, wholly exonerated from extravagance, and having adopted all the minor suggestions made. It now understands from the Minister that the recommendations of a positive and long-term kind which were made are not to apply at all. The amazing success of the English National Opera in its move from Sadler's Wells to the Coliseum, achieved by Stephen Arlen and splendidly developed by Lord Harewood, is seriously at risk.

As to the National Theatre, Lord Rayne's letter in this morning's edition of The Times says all. My noble friend Lord Hutchinson of Lullington will deveop the case and, if he has time, will refer to the ridiculous mess-up over the "in lieu" regulations at the Tate. The National Gallery's purchase grant was £3,109,000 in 1980 and, to keep pace with inflation, it should now be £4,341,000. It is in fact £2,750,000—a huge shortfall. I suppose that the Government's reaction is, "Well, you've got a marvellous collection. Be content with that for the time being". They do not seem to realise that institutions and institutional staff need enthusiasm and development, and that just staying put leads to stagnation. They are advised to expect no improvement for at least two years.

The National Portrait Gallery has had its running costs cut by 6 per cent. With great and energetic enthusiasm it has responded by increasing its margin over sales at its shop very considerably, only to find this surplus deducted from its current grant. The V&A is in the same boat over its sales and objects equally strongly; but its grant is not quite so reduced and a fair figure has been allowed for very heavy and long-overdue repairs and maintenance.

I said, when I was looking at some of the worries of the regional arts associations, that the whole atmosphere in the provinces had gone wrong. It has gone wrong here in London, too. I know that the Arts Council cannot distribute more than it gets, but its new methods have been praised by nobody and will not be praised by me. I know that the noble Earl is genuinely devoted to the arts, but I fear that he risks being even more devoted to monetarism. Yet he is far too well versed in the history of art to think that good art has ever gone hand in hand with a balanced budget. The accountant's approach pares here and squeezes there, never considering how quality is affected, inevitably causing what has to be done to be less well done, until in the end it is not worth doing at all. Then the returns from tourism fall and the accountant wonders why.

This country recovered marvellously after the war. However, from the mid-1960s we have been going steadily downhill. I do not want to discuss who is to blame. I simply point out that the businessmen could not stop the decline in their own performance, and nor could the politicians. The only element in our nation which has grown steadily—and this growth is almost entirely due to Government subsidy—in size, in efficiency, in employment (the numbers employed in the arts are quite 8 to 10 times what they were before the war) and in glory, is the arts. It is the one good thing that we have got out of the last 20 years.

London is the artistic centre of the world and is rivalled—actually rivalled—by Edinburgh, Liverpool, Manchester, Birmingham and many other great cities. The one thing which foreigners are interested in is our art, our literature, our marvellous country houses, our opera, our theatre and our ballet. We must not let this Government, in their desire to build up commercial success, spoil the one great asset that we have retained. I think that they are beginning to do just that.

My Lords, I find myself stimulated and encourged by the account of the state of the arts generally that has been given by the noble Earl the Minister. I would not dispute a word of what he said in that respect. But that does not alter the fact that the serious, moderate people who run most of the arts organisations in this country are worried; that they have no political axe to grind; that their fears are perfectly genuine, and that there is a perfectly genuine cause for them. I shall return to that subject in a moment. However, before I do so I should like to say that, in the circumstances, it gives me great pleasure to offer the Government, from the bottom of my heart, a genuine bouquet. I refer, of course, to the £25 million which they have given to the National Heritage Memorial Fund to secure the future of the three great houses which the noble Lord, Lord Donaldson, mentioned.

As someone who is primarily concerned nowadays with the conservation of historic buildings and their contents, I salute the Government with admiration and with gratitude for the grant. It is, of course, exactly what was intended when the fund was set up. The fund was never intended to cover all major collections or major works of art. The Government had to deal with situations as they arose and as circumstances permitted. That is what they have done and I suspect that we are lucky that this has been possible at the end of the financial year because it is something which can be done without incurring recurrent expenditure. However, that does not in any way diminish my gratitude.

We must be realistic as well as grateful. I must say in passing that the "acceptances in lieu" system is not working well. It is a very good system. Owners get certainty and privacy and the nation gets works of art cheaply. But the ceiling of £1 million makes a mockery of that system. I had intended to say more about it, but as the noble Lord, Lord Donaldson, said that his noble friend Lord Hutchinson would be dealing with the matter, and bearing in mind his experience at the Tate, I shall leave it for him to speak about it because I am sure that he will do so better than I can.

Of course, what would be very much better would be to do what they do in France and write off the tax instead of having to compensate the taxman. I am sure that I would be told that that would increase the public sector borrowing requirement; and so, of course, it would; but it all depends upon what the nation is willing to spend upon these things and whether it could accept an open-ended, although probably not enormous, commitment. It depends what you think is the value of the arts in our national life and what should be their claim on the public purse.

Are the arts to be given a special, and specially protected place? Do we acknowledge that they deserve such a place? Do we think that they deserve it because of what they do for the human spirit, or because of what they could do for a country beset with social problems? Or do we take that view because, as an investment, the arts can be huge earners of foreign exchange? I would argue for special consideration for the arts on all three of these counts. First, I would put forward that argument because of what the arts do for the spirit. I recall Austria at the end of the war when its economy was on its knees. What was its first priority?—to rebuild its opera, a symbol of national attachment to real values. Which country since then—Austria or Britain—has had the better economic progress?

I would also argue for a special place for the arts because of what they can do to help social problems, inner city problems, problems of unemployment. I am sure that the Arts Council had this in mind when announcing their policy of "The Glory of the Garden". I admire that plan to increase resources in the regions, especially in deprived areas. However, at the cost of immense effort and upset they have shifted about 6 per cent. of their grant. I take my hat off to them for having shifted as much. The fact is that, without a quantum leap forward in resources, the policy is relatively meaningless. They must have the extra resources to enable them to do it without reducing London as one of the great artistic capitals of the world, with all that that brings in as regards visitors and earnings.

The third reason why the arts should be given a protected place is that they are both directly and, even more, indirectly hugely successful earners for the country in relation to the size of the investment that is made in them. It must make sense to invest more in these British successes and not to underfund these great flagships of our cultural life—the National Theatre, the two opera houses, the Royal Shakespeare Company.

Therefore, in my judgment, the case for the arts is impregnable. But what worries me is the disunity that is displayed in making the case to the public and the Government. The public quarrel between the Arts Council and the National Theatre makes it really look as though the system of public funding—which has worked so well in this country and which is really envied abroad—is coming apart at the seams. The arts ought to be presenting a united front to the Government. The proper place for the Arts Council is at the head of the arts lobby. It should be a standard bearer for the arts lobby. I am proud to belong to that lobby and it should never be spoken of slightingly.

The Arts Council's central purpose is not only to distribute Government funds but to convince the community, and through the community the Government, to recognise the needs of the arts and the benefits that they can bring. Arts organisations have a right to expect that the council will press their case not only in detail and in private but in general and in public. I sometimes wonder whether the council is not so preoccupied with the problems of the injustices in relation to distribution which it is trying to put right that its role as advocate is being given less prominence than it should.

A policy of expansion within a framework of restriction is not very easy to put across at the best of times, and the truth, which the council somehow has to put across, is that you cannot redress the imbalance between London and the regions without substantial extra funds unless you are ready to downgrade London as a national artistic capital—which is something which neither the Arts Council nor any of us wants to do. They must press this truth at all times, and be seen by the arts world to be doing so.

The role of the noble Earl the Minister for the Arts in all this is perhaps a little confusing as the noble Lord, Lord Donaldson, indicated. It is a little different from that of previous Ministers for the Arts. He is brilliantly qualified as an arts Minister, and I have the greatest of admiration and, may I say, affection for him, but of course he is much more. He is an economic Minister too. He is one of the stars in the Government's firmament. Though your Lordships will have differing views about the brightness of that firmament, he would be bright in any firmament which your Lordships can imagine. But he wears two hats, and while wearing one of them he urges the case for the arts, when he is wearing the other he has to admonish the arts to get back into the queue.

He is primarily occupied—and why should he not be?—with keeping down the growth of the public sector, and I understand and sympathise with him in the conflict between his two main interests. But really, four years after what the Government describe as steady economic recovery is it necessary so to squeeze the Arts Council's budget in a way that leads to the closure of the Cottesloe? The Minister argues that if the arts are increased by more than the rate of inflation—and I quote him from the Observer, and he repeated it this afternoon

"a damaging and incomprehensible signal [would be given] to the rest of the economy".

Apparently the arts are watched jealously by the rest of the economy, and if the Government immunise them from expenditure cuts, the line cannot be held elsewhere. I am bound to say that this does not sound plausible to me, and I do not think it right for a Minister for the Arts to say it.

My Lords, I am most grateful to the noble Lord. He is being very fair in his logic and criticisms. I said a substantial quantum increase, not a squeeze. The Government have up-rated the arts grants. It was a substantial quantum increase at a time when other budgets were being squeezed that I thought would be misinterpreted.

My Lords, I am sorry if the order of my speech has not made it clear that it is a substantial quantum increase for which I am asking. That is what I would have hoped that the Minister for the Arts would also be asking for.

Apart from anything else, the fact is that the Government spend and cut selectively—and quite right too. They decided, and in my view for good reasons, that defence should have a steady real increase. And of course the defence sector is so large that increases there have a really major effect on the overall budget. But the arts budget could grow in real terms without having any perceptible effect on the budget as a whole, unless of course we accept the thesis that everybody else is going to break out of line because the arts are allowed to do so.

The real question quite simply is this: do we want more for the arts or not? There is not any question that it can be afforded. The arts lobby—and I speak with pride of belonging to it—believes that the time is right, and has always been right, for a quantum leap forward, and that this, without prejudice to the Government's economic policy, is possible as well as desirable. I should like to see the Minister for the Arts proclaim this cause from morning till night.

This country has been envied by artists abroad for its system of arts financing, but derided for its low level. I shall not repeat the figures that have been given, and I am sure that we shall have again this afternoon figures spent in other countries. If recovery is really on the way, let us celebrate it with a change of heart and follow the example of those countries.

Sir William Rees-Mogg has argued with devastating clarity that £100 million spent by the Arts Council theoretically reduces the public sector borrowing requirement by £25 million. Well, he admits that it may not apply to the whole grant, but it is clear that it is true at the margin. Extra grant sufficient to enable him to be fair to the regions without damaging London and the national companies would almost certainly be self-financing.

The Government have not taken Sir William's argument seriously. I hope that he will continue to batter them until they do so, and shower them with all the other arguments which are going to be made in the House this afternoon—and batter them loudly so that we can all hear. And when we can all hear then the present—and I hope temporary—disunity in the arts world will evaporate and we shall draw a step nearer to the promised land.

My Lords, this Motion which has been set down by the noble Lord, Lord Jenkins of Putney, invites us to discuss two entirely different subjects, support for the arts and the future financing of broadcasting. I propose to say something briefly about the first, but not to attempt to touch on the latter. They are both subjects of great importance but neither is in any sense a party matter.

So far as the arrangements for support for the arts are concerned, we may take it as axiomatic that there will never be enough money for the purpose—never as much as those who are committed to financing the arts from the public purse will regard as enough. The sky is the limit. I think I have told your Lordships on a previous occasion what Sir Kenneth Clark once said to me, speaking of the Arts Council grant at a time when he was himself the chairman of the Arts Council. He said:

"Everyone says that we ought to have double. If we had double, I am sure a great deal of it would be wasted."

That was nearly a quarter of a century ago, in 1960, and the Arts Council grant was then, believe it or not, £1½ million. This year the Arts Council grant is £105 million, and they say—and they may be right—that they cannot get by without £15 million more, a total grant of £120 million. That is 80 times as much as 24 years ago. It is true that there has been substantial inflation in those 24 years, but not inflation on that sort of scale. It is true that the activities of the Arts Council have expanded, but not to that degree. The fact is that although there is now very much more butter, it is now spread, I think, perhaps too widely and too thin.

The support of the Arts Council for an enterprise is no longer, as it was in the earlier years, a certificate that the enterprise is worth supporting; that its quality is, as it should be, exemplary. Of course it is easy to criticise, but not at all so easy when once an enterprise is taken on to the books to cut it off if it does not realise its early promise. It is always difficult to be a good butcher. But when it comes to the savage cuts that, for example, Sir Peter Hall has had to announce at the National Theatre, cuts of 100 in the staff of the splendid organism he has created there, and the closure of one of the three auditoria—and that one, though the smallest, certainly the most interesting and original of the three, where he has built up a quite unique enterprise—then there must, I think, be something wrong.

I must make it clear to your Lordships that although the National Theatre Board, of which I have never been a member, have done me the great and uncalled-for honour of attaching my name to the auditorium in question, I do not speak with any personal feelings; although I should regard it as a tragedy if Sir Peter finds it necessary to close this theatre and I welcome the signs that he may be able to effect a reprieve.

I wonder whether the system of financing for the National Theatre's operations in that enormous tripartite building is the best that can be devised. I wonder whether it might not be better, as has been suggested, to make a separate subvention for the maintenance of the whole building and then to subsidise, as necessary, separately the operations by the company in the three auditoriums. Be that as it may, I hope profoundly that some solution may be found. But what I feel fairly sure about is that, among the vast complex of activities that are now subsidised by the Arts Council, there must be some room for pruning some of the less valuable, painful though the process of pruning must always be.

On the more general question of support for the arts, I hope that your Lordships, and, in particular, Ministers, will never forget the history of the ill-fated Land Fund whenever they are advised that funds for any essential purpose cannot be made available. Your Lordships will recollect that at the end of the war Hugh Dalton. who was then Chancellor of the Exchequer, set aside £50 million that he had in hand from the sale of surplus war stores to be used for the preservation of the national heritage as a memorial to the war dead. That money, my Lords, was not a notional fund; it was hard cash from the sale of surplus war stores. The Treasury, however, succeeded in persuading successive Governments that either the fund did not exist or that it was a mere book entry; even though they themselves published each year a list of securities held for the fund. By this means they ensured that the interest on the fund was always grossly underspent and, after a few years, they persuaded Mr. Enoch Powell, who was then Financial Secretary and who ought to have known better, to return the original capital of £50 million to current revenue; to return it, in fact, to the original donor—an action which, if it had been taken by a body of trustees, would no doubt have been fraudulent—thus leaving the fund with only some £10 million or £11 million of accumulated interest.

In the aftermath of the Mentmore scandal, the all-party committee that examined the Land Fund succeeded in rescuing the remains of the fund and set them up in the hands of independent trustees such as the National Heritage Memorial Fund, the Treasury still protesting—I heard them—that the fund did not exist or, if it did, that it was a mere book entry. The joint committee, however, recommended that the original £50 million should be restored to the fund, perhaps by instalments over a period of five years, remarking that, even so, inflation would have brought the original £50 million up to £250 million so that the Treasury would have got away with four-fifths of Hugh Dalton's original capital. And this restitution which was recommended, of course, has never been made. I hope, whenever Ministers are advised by the Treasury that funds are not available for a necessary purpose in support of the arts or the heritage, that they will remember that unhappy story. While we may rejoice at the special subvention recently made available to rescue Kedlestone, Weston Park and Nostell for the nation, we should never forget the story of the stultification of Hugh Dalton's splendid vision.

My Lords, I will leave to others the question of the Minister's "brazening out" (as it was called) of the case; but I should like to say a kind word about his mention of so many artists and their work. I think that they will be very pleased to know that a Minister is aware of their names and of the work they do and that their names have been mentioned in this forum. All artists, even when they are rich and successful, have need of love and appreciation. We are debating television and the arts together because both are part of our "cultural heritage". I use those words with a certain amount of trepidation because in a previous debate it was suggested that they were pompous and rather ridiculous words. But the Minister used them so freely himself this afternoon that I am emboldened to use them myself. As I say, they are both together facing difficulties about their future and, of course, broadcasters are very important patrons of the arts.

It is a cliché that Britain has the best broadcasting service in the world; yet its excellence could be destroyed if a Government were to decide that the BBC should live by advertising revenue instead of by a licence fee. That is what is now being suggested, what is now being advocated and what is now being campaigned for.

My Lords, will the noble Lord allow me to intervene for a moment? Is he including television in the generic term "cultural heritage"? If so, is that not overstressing the term a bit?

My Lords, indeed I am. I think that the noble Lord must see very little television if he is not aware of what it does for our cultural heritage.

As I was saying, the Government have been very heavily pressed to introduce advertising on to the BBC. It seems such a simple solution. The BBC has great audiences and if it accepted advertisements, it could save us all or part of the licence fee. But it is not as simple as that. The first snag is that there is not nearly enough advertising to support both broadcasting systems and the press. There would inevitably be a desperate struggle for the high ratings that would attract advertisements—the kind of situation in which the American companies find themselves today, settling generally for the lowest common denominator. It is not the highest forms of television which get the ratings which attract the largest audiences; it is the "soaps", the jolly games and violence. Those of us who have worked in popular journalism know the perils of desperate competition for audiences and know what happens if you have even slightly higher standards. The News Chronicle and the Daily Herald could not survive on circulations of over one million copies a day. They could not attract enough advertising.

The threat to broadcasting is not imminent. However, it may be only a year or two ahead. The idea is being strenuously canvassed that the BBC licence fee should be renewed for one year only and that, in the meantime, the Government should hold an inquiry into the feasibility of running the BBC wholly or partly by advertising and perhaps of selling off some of its more profitable parts. One might face an inquiry of this kind with confidence, for the answers that that inquiry would come to seem to be inevitable. The amounts that advertisers are willing to spend do not increase to match wider opportunities offered to them by the media. There will be fierce competition among the television companies for a limited amount of advertising; and that means lower standards.

The dreadful truth about broadcasting is that excellence costs a lot of money and provides limited audiences. The excellence of British broadcasting has been achieved because the BBC established standards which created in the minds of the listeners and the viewers a very positive idea of what good broadcasting should be. When independent television started it was feared that, in its need to maximise audiences, it would fall well below these standards; and so, for a time, it did. However, the danger did not last long. The ITA board insisted, when the companies became highly profitable, that they should not go for the numbers in every programme, but sometimes should raise their sights. The result is that independent television today competes in excellence with the BBC. "Brideshead" and "The Jewel in the Crown" are as good as anything the BBC has done, if not better. They stand beside "Smiley's People", "Barchester" and so forth. So in effect we have two public service broadcasting organisations competing in excellence and competing in variety, but not competing for revenue; and independent television profits are big enough for it to shovel millions of pounds into the remarkable Channel 4, and enable that channel to commission a new independent programme-making industry. But these good things are made possible only by affluence, and that affluence and the "goodies" with it would disappear once the BBC became the commercial rival of ITV: goodbye to Channel 4, for a start.

Now I would quote David Plowright, chairman of the Independent Television Companies Association, in an address that he gave only a fortnight ago. He became "a Bernstein boy" as he put it, in an oblique tribute to my noble friend Lord Bernstein. He became,

"a Bernstein boy at a time when television beckoned producers towards the seductions of programme risk, and courage and change, and the pursuit was as much of excellence as it was of the majority share".

Mr. Plowright has been calculating the effect there would have been on the 1983 revenues if BBC 1 had then sold only two minutes of advertising in peak time per day. The BBC would have received £193 million, and even assuming that most of this advertising had been taken from the press, the total profits of the ITV companies, before tax and before paying the levy, would have been reduced from £98 million to £30 million—no more "Jewels in the Crown" on that kind of money—and the small companies would have moved immediately into the red. If that BBC revenue had been drawn entirely from the ITV companies, all of them would have gone into the red, with a loss to the network as a whole of £23 million.

It is possible to argue that Mr. Plowright's assumptions, on which he based his calculations, are too pessimistic and that some new advertising revenue would be generated if the BBC went into the market place. So it might be, but I think the logic of the situation is that there is not room in Britain for two large systems competing for advertising revenue, and any commission of inquiry could be persuaded of that. One could be confident of the future if one could be sure that reason would prevail, but so many interest groups are strongly involved; I do not blame them for it, but they are. There are interests in cable and in satellite, and of course it would be easier to get subscribers for that or for pay-TV if people were not paying out this largish annual subscription for the BBC.

One could be confident, too, of reason prevailing if so much hostility towards the BBC had not been demonstrated during recent weeks, fed by three or four long leaders in The Times. "Whither the BBC?" they asked; and I and many other readers much have asked the question: "Whither The Times?" What has released this hostility is, of course, the desire of the BBC to increase its licence fee for colour television over the next three years from £46 to £65—an increase of 41 per cent.—in order to cope with increasing costs and to improve and develop the service. That is a tall order, my Lords, and whether the BBC were wise to go for all that I do not know. But even those of us who believe that at all costs the BBC must be preserved in its integrity as an independent public service institution would want to look very carefully into the books before agreeing to that.

Yet, as the BBC argues, it is still wonderful value for money. For all those hours of colour television on two channels, for all those hours of radio broadcasts, the price per family is about that of a daily newpaper or a daily pint of milk. But of course we do not have to pay our milkman or newsagent only once a year, as most of us pay our television licences. It is possible to pay in advance by direct debit or by buying stamps, but I think most of us pay it annually and there is a little pain as we part with the money.

What of those who cannot afford what has become universally one of the main pleasures of life? I should imagine that the best way out of this is that people who are on supplementary benefit should be given some licence vouchers which the BBC could exchange for cash. I think that is the only way in which the Government could come into the situation without trespassing on the BBC's independence. However, this need for more money has opened the way to a variety of critics and enemies who want to cut the BBC down to size or even to sell off lumps of it to private enterprise.

Why so much antagonism? There is a current revulsion against size in organisations. People believe, sometimes rightly, sometimes wrongly, as I think in the case of the BBC, that the economies of scale a large undertaking enjoys are wiped out by a proliferating bureaucracy. The Peat Marwick independent expert inquiry into the BBC's finances published today gives (as one paper puts it) "a Beta plus" to the BBC. There are some economies to be made, but not on a very substantial scale, in the light of the total costs of the BBC.

Then there is the dislike of the media today—of all the media—as the bringers of had news. They seem to be to some people an addictive drug that gives us too many bad trips. We in London but for the media could be oblivious of the miners' strike, the African famine or even the terror in Ulster. And sometimes it seems to people that merely by probing and recording some evils the media actually increase them.

The BBC incurs the displeasure of those on the Left and the Right who pursue conviction politics. Its traditional fairness—inevitably imperfect at any moment in time—looks reactionary to the Left and subversive to the Right, and of course there can be no perfection in such a relationship. At this time we are worried about the divisions in our society. We had a debate on the subject only a week or two ago and we failed then to note the part that the BBC—and ITV shares in this—plays in making us one nation. The miners, in the bitterness of this moment, may believe that the media let them down. Yet Mr. Scargill was the television man of the year, and he had his say freely and frequently. Once the BBC was unacceptably paternal, and this, too, is held out against it; but it has not been paternal for many years. It is today, as it should be, fraternal—something which it has learned from ITV.

It has sometimes been criticised as being élitist. All these things are entering into the general argument for changing the character of the BBC. Some say that it is élitist—all that classical music on Radio 3 and all those Shakespeare plays on television. But just as often it is criticised for sinking itself in order to enter the pop world on radio or to run "soaps" and silly games. Yet, obviously, if the BBC is to collect a licence fee from all, it must give a complete service.

Here is a publicly owned industry that has both taught the private sector and learned from the private sector. It has been singularly successful in show business, of all things, and yet has been in the forefront of technical discovery and application. The BBC has shown the virtues of both public and private enterprise. I must add in this debate that it is the greatest patron of the arts. The BBC can claim to spend more on the arts even than the Arts Council itself—up to about £150 million a year. It has six orchestras and is the major employer of musicians in this country. The national network broadcasts 18,000 hours of music. It is also one of the most significant patrons of drama. It gives 15,000 engagements to actors and initiates thousands of plays, serials, features and readings. It commissions 300 original radio plays and gives 60 dramatists their first professional chance. And, of course, the BBC's educational output is prodigious. The education department provides 20 per cent. of television's output. The schools derive much from it and give to it. My political friends take pride in the BBC and so they will do all they can to protect its integrity and independence. I feel sure that most people in this House share that desire.

Of course, there is a communications revolution. Cable is not the front runner that it was thought to be—to put it mildly—but satellite is coming, if anyone can afford the technology. The future is hard to predict. What I am certain about is that we shall face it more steadily and with greater wisdom if we keep at the centre of an exploding communications system our bedrock of traditional public service broadcasting, sensitive as ever to the deeper needs and long-term aspirations of the people in this country.

We have, I repeat, the best broadcasting system. There is no need to defend it. The onus is on those who seek radical change. They have to show us that they can give us something better, something socially more valuable, something artistically and morally more valuable, and not just a set of new licences to print money.

My Lords, I venture to speak in this debate in my capacity as chairman of the National Heritage Memorial Fund and I should like to begin by thanking the noble Earl, Lord Gowrie, for the very kind remarks he has made about the fund, and, indeed, about myself, at the beginning of his speech. I have no doubt that those thanks will be echoed by the noble Baroness, Lady Airey, when her turn comes to speak.

The National Heritage Memorial Fund has nothing directly to do with the performing arts, about which the greater part of this debate has so far been concerned. We are, however, intimately concerned with the heritage, both with what I describe as moveable heritage, by which I mean museum objects, pictures, documents, manuscripts and sculpture, and with what I describe as heritage real estate, by which I mean the great houses of this country and their contents, woodland, wilderness, wetland and indeed the habitat of birds, bats and bees. I may say that the restitution of some of our noble but decaying piers—and, of course, I am referring to those that abut from our territory—is also our responsibility and I should like to speak a little about it.

I suppose that the chairman of any organisation that has received a totally unexpected gift of £25 million would be tempted to describe that as an act of great statesmanship on the part of the donor. But in this case I do without any hesitation describe it as that, and I should like to say a word of unstinted praise and thanks for what the Government have done in giving the National Heritage Memorial Fund £25 million for the preservation of Kedleston, Weston Park and Nostell Priory, with all their contents, to ensure that they are there for the enjoyment of the nation for all time.

I think that in doing that the Government have treated the National Heritage Memorial Fund in a very proper manner and are making very proper use of it, because we have been given this money with really only one string; that is, to devote it to the preservation of these three great pieces of our heritage. Nobody has told us what solutions we have to find, but only that we must try our best to find solutions. It will not be easy. Each of these three territories presents a different sort of problem. But the great thing now is that the National Heritage Memorial Fund, because of this money, has been put in a position to negotiate realistically for the future of these properties. What is more, we can keep the change. I shall be very doubtful if there is any.

That, of course, brings me on to my next problem, because this £25 million will all get spent on these three properties, and this is where a word of caution has to be said. I am sufficiently ingenuous financially to consider £25 million an enormous sum of money and I think that other people may feel the same. They may therefore think that now the National Heritage Memorial Fund has £25 million, it is all over bar the shouting and they and the heritage are looked after for all time. Not a bit of it, my Lords. If you take into consideration what we have and the commitments we have made for the future, and if you forget the £25 million and Kedleston, Nostell Priory and Weston Park, we shall not have very much more than £3 million to spend in 1986–87 on what I would describe as new projects; and we all know how far £3 million now goes when we come to talk about great pictures. I know that the Government and the noble Earl are aware of this problem and I am quite sure that the Government will do their best to restore the position about which the noble Lord, Lord Cottesloe, spoke. Therefore, on this occasion it is a great pleasure for me to throw a bouquet at the Government amidst the hand grenades and brickbats which are coming from other parts of the House.

My Lords, I should like to join in the very sincere and heartfelt thanks to the noble Lord, Lord Jenkins, for initiating this debate, but to temper them with a slight complaint about the widening of the field. Each of these subjects that we have before us today has the makings of a first-class debate and the lumping of the two together will not produce a result as useful as that from taking each one separately. Your Lordships' debates are at their best when they are not too diffuse, and I say that in spite of the extremely able, interesting and, to me, sympathetic speech of the noble Lord, Lord Ardwick, which I would have welcomed doubly warmly on another occasion.

The subject which I wish to tackle is the funding of the arts and I wish to concentrate on a very small section. I want to talk about the visual arts, with which I have had close contact over a number of years, first as a collector of modern British painting and sculpture and then as the husband of an art critic. But in approaching this subject, I deliberately choose a special angle which stems from my political beliefs.

I am not concerned this afternoon with high art. In a Chamber like this, there will be no shortage of protagonists for that cause, and indeed there has already been no shortage. You could staff the whole of the British high artistic establishment from the ranks of the Social Democrats alone. No, my Lords, I am concerned with the support of the ordinary artist—the "poor bloody infantry" of the art world. But I do so knowing that the encouragement of the quantity encourages quality as well. In today's Financial Times the TV critic points to the pyramid of acting talent whereby we have the splendid heights of achievement that we do have because we have such a wide base of acting ability. And what is true of the performing arts is also true of the visual arts.

I start from the proposition that we want more arts—more art and more artists. I am aware that this is a very unEnglish attitude. The English thoroughly approve of there being artists only so long as there are not too many or them; so long as they do not tax the brain; and so long as they do not frighten the horses! Above all, it is considered that they should belong to a specifically English tradition—the tradition of Handel, Elgar, Walton, the Nash Brothers, Stanley Spencer, Lucian Freud and Elizabeth Frinck.

It does not matter if they are foreign by origin; as long as they are prepared to follow the rules of our game we are prepared to take them over. They are allowed to shock occasionally; that, so to speak, is their metier; but they are not allowed to try to make us think. That, of course, was the ultimate crime behind Carl Andre's bricks at the Tate. If we had taken him seriously we would have had to think about them, so the only thing to do was to laugh them out of court. Anyway, he was a foreigner, which only goes to show! We do not really like having too many of the "fellers" around: they tend to be insanitary in their habits, loose in their morals and radical in their views! We like a few as national household pets. But a few is enough.

When we were expending all our national energies on winning and keeping the Empire or pioneering the world's industrial revolution, that was fair enough. But it will not do now. A number of things have changed and we have to prepare ourselves for a different kind of society. I believe the kind of society that is coming will be one where we have nothing to lose and a great deal to gain by encouraging artists. On the practical side, design and originality, lateral thinking and flair, and a lot of other things which we have previously distrusted, must be encouraged. One of the ways we will encourage them is by leavening our society with a lot more artists. That is what we have to gain; plus a more civilised and imaginative nation.

And we have little to lose by training and encouraging our people to be artists because we shall not be taking them away from "useful jobs" since there are not any to take them away from. And so we should be concentrating on what we can do to help and encourage artists. And it really does not cost a great deal, which should encourage the Government. The kind of thing we should be doing more of is exemplified by the work of a particular organisation "Air and Space", an organisation which a number of your Lordships, including the Minister, know well. It is—I mention it lest I should be thought to be concealing an interest—something my wife is involved in; but I am in no way a "front man" for her, or for the organisation for that matter. I decided I wanted to talk to your Lordships about it because it seems to me to exemplify the kind of thing we should be encouraging, not because I am grinding anyone's axe.

"Air" started off as the Artists' Information Register and now has a gallery of its own, a gallery devoted to giving shows to artists who do not have a commercial gallery or who are just beginning to make their way. "Space" is self-explanatory, it is involved with providing cheap studios for artists. It, too, is involved with helping artists to exhibit because the idea of open days in studios is becoming more and more popular. Contrary to what might possibly have been expected, the public find visiting the artists' studios with the artist there less, and not more, daunting than visiting galleries. Where you have a large number of artists working under one roof and running their premises co-operatively, that is easy to arrange.

There are now Space studios in Wapping and Deptford, St. Katharine's Dock (where Bridget Riley and Peter Sedgeley founded the organisation), and Stepney Green and in many other parts of London.

There are 22 studio buildings housing some 250 studios all over London, and there are another 250 artists on the waiting list. What is more, the idea has travelled all over Britain, spread by dedicated missionaries, and there are Space studios in Bristol and Liverpool and many other cities. There is a charity, Arts Services Grants, chaired by Nancy Balfour, and a small and dedicated staff. And the support is strong. The late Lord Vaisey was at one time the chairman, and the noble Lord, Lord McAlpine of West Green, was one of the founders. In Scotland, there is an equivalent called WASP, which I think stands for Working Artists Studio Provision. I am not quite sure why the "W" is needed. English artists work too.

The point of filling in the detail like this is to give the picture—the accurate picture—of a well-established institution: well-established because it is efficiently filling a perceived need. But of course it is not as simple as that. These organisations may be—and indeed are—cost effective; but that is not to say there is no cost. There is no typical Space studio, but if there were it would be a dockside warehouse, probably a very fine building of its kind.

Ten years ago Space would have got it on a minuscule rent for a short time before it was knocked down. In these more enlightened times, it will have had a preservation order slapped on it—and a very good thing too—and since the owner cannot knock it down, he will be trying to find tenants and the price has gone up. But if Space can find the money it takes it over on a I 5-year lease and has to spend quite a lot of money on conversion—nothing fancy, mind you, but fire doors, loos and basic essentials, all of which mount up. Besides providing studios for artists, this is worthwhile capital expenditure on good buildings which ought to be, and now must be, preserved. But the money for it is not easy to find. The Arts Council is full of good will to Space and its imitators, but it is not full of money. This is not a field which is yet particularly attractive to sponsors, though I see no reason why eventually it should not be.

I am sure that money spent on schemes like this is a good investment in the arts, a good investment in worthwhile buildings, a good investment on the part of society in one of its vital functions—the arts. I believe that money could be raised as part of the noble Earl the Minister's Business Sponsorship Incentives Scheme, and I am delighted to hear of the changes announced today, especially the lowering of the qualifying limits. Perhaps there should be a special capital investment version of the scheme.

I have taken this afternoon one concrete scheme which we know works, which stands up to examination, and which is open to no accusations of overspending or waste. I have made a particular suggestion to which I do not ask for a reply today. But, more importantly, I want to make the general point that this kind of investment is worthwhile and, contrary to the feeling of the Government, that the Government have their part to play in ensuring that it is made—a very important part to play at that.

Of course, there will be mistakes. But, if I may, I will close with a quotation from the late lamented Gully Jimson which the noble Earl the Minister should frame and put on his desk:

"Everybody makes mistakes. Even a generation devoured by worms at Government expense. But unless you spend millions you don't even get mistakes—you have nothing at all. Just a lot of social economics lying about like army disposal after the war before last or the war after next".

My Lords, having the honour of being a trustee of the National Heritage Memorial Fund, I should like to join my noble friend Lord Charteris in expressing deep gratitude, especially to the Minister, for the wonderful sum of £25 million. I have to admit that to me—and I am also an innocent, financially—it really does sound absolutely splendid. But I am equally grateful to my noble friend Lord Cottesloe for explaining so clearly how that sum should have been very much greater, if it had been left for the purpose for which it was originally intended.

He explained also—as did my noble friend Lord Charteris—how many difficulties we in the National Heritage Memorial Fund face with the many claims on our expenses. I am thrilled—as we all are in that trust—that we are able to help Kedleston, Weston Park and Nostell Priory—at all of which I have stayed and which I know very well. The furniture involved is really marvellous. It is almost unbelievable that Thomas Chippendale started at the latter estate as carpenter. I imagine that all his pieces were really intended for the places where they may now be seen—so it is doubly important that we should be able to keep them there.

In considering the very important matter of those three marvellous houses, perhaps I could say that the fund also received an application for a much humbler item of heritage. It was a steam tricyle. It was called the Craigievar Express—and I hope that I do not need to be corrected in my pronounciation. It was a wonderful object built by the local postman, who was called "Postie Lawson". He invented it in 1895. He probably took as much trouble and as much pride in the making of that wonderful object as did Chippendale in his creations. I am delighted that the fund will be able to help the Grampian Transport Museum acquire that object. It is particularly nice since a number of noble Lords today have observed that perhaps the south might be more favoured—but this lovely object is going to the Grampian Transport Museum.

The heritage about which we have talked so much today is always growing and therefore the financial liability is always growing larger. The Victoria and Albert museum now has rooms dedicated up to the 1960s, and if they are not actually on view yet I believe that the museum has plans for exhibits even more contemporary than that. Recently, the National Heritage Memorial Fund has contributed to the cost of a picture by a living artist, and that is important in the light of the comments made by the noble Lord who spoke before me. It shows that the fund is interested also in supporting those who are already working in this field.

I do not believe that the Government by themselves can support all the demands and expense, given the increase in our heritage, without cutting expenditure in many other worthy areas which we also all support. It is up to all of us who care for the arts to do our best to ensure that they are supported by other sources of funds as well. This afternoon, I should like to cite two examples in which I have a particular interest.

First, I am fortunate enough to be a trustee also of the Imperial War Museum. It is a wonderful building but it has one great disadvantage. The museum has a very large number of exhibits which it is not possible to display. Also, it is not possible to expand the museum in either direction because of other buildings. But the Imperial War Museum has, as does the Ashmolean, a large hole in the middle (if I may describe it as such), and we have the services of a wonderful architect who has devised a scheme to build within that hollow and thus provide a lot more room.

We also have a very energetic committee, quite apart from the trustees themselves, although most of them sit on the committee also. They are making the most tremendous efforts to raise money. We started—rather like that lovely story about the £25 million—with the Sultan of Brunei giving us £250,000. The Wolfson Foundation has given a further £350,000, and other individuals or trusts have brought the figure up to £1 million. Your Lordships must not think that I am using this occasion to advertise, but perhaps I may be forgiven for making the point that we need urgently to collect £2½ million.

If we do that—and I am looking at my noble friend the Minister at the moment—then I believe that we may expect to receive from the Government sufficient (and I believe that the figure could be up to £6½ million) to continue this marvellous job. The Imperial War Museum is immensely popular and is much frequented by young people. It shows the heroic deeds of many of their fathers and grandfathers (and also their mothers, if I may say so) in the past.

I hope that we shall be able to raise that sum of money, but we also have the task of maintaining that marvellous museum. There has been a good deal of controversy surrounding the question of whether one should charge for entry to museums. When I realise how much I had to pay for admission to a museum abroad, I begin to wonder whether we are not being over-generous. Taking it into account that pensioners and young people are admitted free, are we not being over-generous to the tourists, who, as has already been mentioned this afternoon, arrive in such enormous numbers to see what we have to show them in this country?

I believe that we have found rather an ingenious compromise. Turnstiles have been installed at the entrance of the Imperial War Museum. There is a notice pointing out that the museum faces great problems in meeting the expense of upkeep, and that if visitors feel like donating £1, or more, or anything, then that would be very useful and helpful. We introduced that system on 4th December. I have the figures for the period up to 5th March, and I am happy to tell your Lordships that we have collected so far donations made quite voluntarily totalling £15,212. I remind your Lordships that this is a dead time of the year. If we were to achieve a similar figure for all four quarters of the year, then it would raise just over £60,000. But since this is the dead time of the year and we have the tourist period still ahead of us, then we are hopeful of collecting a sum in the region of £100,000 towards our annual running costs. We are going out to help ourselves.

I should like to speak briefly on one other area of the arts that is of interest to me—the Chichester Festival Theatre. We have heard some pretty gloomy news about theatres this afternoon. I am longing to give your Lordships some good news, and will try to do so in respect of this very remarkable theatre. Some of your Lordships may have visited it, or may have seen some of the productions which started life at the Chichester Festival Theatre but which eventually came to the West End.

The theatre was built about 24 years ago for, I think, about £100,000—pretty remarkable even 24 years ago. I understand that it now survives with virtually no Government subsidy and only a very modest local subsidy. How does it manage? The theatre is always absolutely full and the prices are not very high. The actors, I must admit, are very well known. In fact, many of the names mentioned by my noble friend the Minister have been appearing there recently. But the theatre does, of course, very firmly believe in business sponsorship. This has been extremely successful. Perhaps it would be better not to mention some of the names lest I get into trouble for advertising but if a company gives a really good donation, it will have its name on the outside of the programme in a very conspicuous place; if it does not, its name will be in a rather smaller place inside. However, let us remember that this advertising is seen by tourists who go there. It is advertising our great British companies as well, and so it has a dual purpose. Therefore, I am very happy to say that things are going well at Chichester.

I beg everyone who cares about the arts to encourage sponsorship. We were very encouraged to hear the Minister's promise to help smaller companies in their sponsorship of the arts. I beg him to convey to Her Majesty's Government the hope that they should see fit to help those who help themselves.

The "in lieu" issue has been raised this afternoon and I do not think I need mention it further, though I know that it is deeply thought about by many people. However, I think that by tax incentives and advantage we can preserve our incomparable heritage from the past and, I hope and believe, ensure the future.

My Lords, I must begin by apologising to the noble Lord, Lord Jenkins, for being absent for his opening speech, but I was trapped at the stage door by two very beautiful young actresses seeking a subscription to the Actors' Benevolent Fund. Secondly, I congratulate the noble Earl, Lord Gowrie, on the precision and clarity with which he outlined the Government's position on what is a very complex matter—there is no point in suggesting that it is not.

A few months ago I was surprised to read a quotation from one of our great poets, Alexander Pope. It was something I never expected. He said,

"Money is the cement of society".

That was in 1722. I thought that your Lordships would like to know that and, as the whole of our debate depends on this matter of money, especially that. Our unique expressiveness as a nation is, I believe, encapsulated in our language—the richest in the world, with elements drawn from Latin, Greek, Scandinavian, plat Deutsche, Indian, Chinese, Caribbean, Australian, Esquimo, and God knows what else. It is a language, an especially widely spoken language, which carries with it the very soul of the country to which it belongs. I speak of countries worldwide from which our soldiers, sailors and merchants have brought back a wealth of words and expressions to add to our dictionary.

But what about the varieties of speech within the country itself? I meet the noble Lord, Lord Parry, in the corridor and start a conversation. I know at once that he did not originate from Durham. I know that he comes from somewhere in the West, in the Principality. A few yards further and I meet the noble and learned Lord, Lord Elwyn-Jones, and he also is a Welshman; but he tones it down, because the Welsh know that they are superior to us and he does not want to hurt my feelings. I turn on the television and hear my old friend Jimmy Bolam talking in north-east English:

"Whist lads, haad yer gobs and I'll tell you an awful story. Whist lads, haad yer gobs, I'll tell you about the worm".

That is from the great poem The Lambton Worm. Next I run into Vic Feather and Joe Gormley and hear a load of Yorkshire. I meet Beryl Reid at our Peers' Entrance and she slips into Black Country as to the manner born; or I meet Spike Milligan talking that beautiful Babu Indian English which he and Peter Sellers brought to such perfection. Wherever I turn I hear, as well as see, British expressiveness in all its richness and variety. It warms my heart. It gives me a shot of pride, a feeling of what we are supposed to have outgrown—patriotism.

Our theatre deals in language. Its soul is language. In the 1920s the first company of Irish players hit the West End of London. Sarah Allgood, Maire O'Neill, Arthur Sinclair, Gerard Fey and others bowled the establishment over. All we had heard before were the Mountains of Mourne and By Killarney's Lakes and Fells. Now we had, through Sean O'Casey's pen, a taste of the real Ireland; as the critic, Desmond McCarthy wrote, "Its soul and substance".

Now a worker—I shall repeat that with more stress; I was told that if I could emphasise a point or even sound as thought I was making a point when it was really not a point, I would be doing very well. Now a worker and his place of work are generally separate; certainly they are separable. Men working at Ford in Dagenham, GEC, Hawker Siddeley, Vauxhall, the CEGB, British Telecom, on the railway or bus routes, have a sort of relationship with their place of work, their tools and benches, their switches and keyboards, and so on. But when the whistle blows they down tools, dust their benches, pack up and go home.

The performing arts are a very different kettle of fish. The actor is his own bench, his own bag of tools, his own panel of switches, his own vice, his own gearbox. Once given a role, it is impossible to detach him from it, and rightly, too. He has become part of the expressiveness of his country. Someone in another place shouted to Chamberlain during those agonised pre-hostility debates. "Speak for England". Those three simple words were greeted with a roar of applause. The actor and his equipment—light, sound, naturally his author, costume, and fellow actors—is speaking for England all the time. That is a burden actors elect to carry when they enter the profession. That is the burden they have always carried.

The slow, agonised growth and progress of the British theatre during my working lifetime is one of the great stories of our nation. We had the repertory movement in Glasgow, Liverpool, Birmingham, Manchester—because the British found out from the visit of the Saxe Meiningham Company that it was much better and much greater fun and much more valuable to work in ensembles than in fragments—and the transformation of a derelict music hall in Waterloo's New Cut, turned rapidly into the Old Vic.

I am going to slip in here a tiny story which the noble Earl, Lord Gowrie, may wish to hear or even use. It refers to Lilian Baylis's manner of dealing with the salary of actors, which bears upon this debate. A young actress came into her office. Her secretary put her head round the door and said, "Miss Baylis, it is Miss Baker, who wants to know about the salary". Without looking up, Lilian Baylis said, "She is worth £10, she will ask for £12, offer her £4, she'll take £5." That persisted throughout the reign of Lilian Baylis.

The transformation of that derelict music hall in Waterloo's New Cut, the brief but brilliant four years by Harley Granville-Barker at the Royal Court Theatre in the 1910s, the development of the fringe theatre—the Gate, the Hampstead Everyman and the Barnes Theatre, where Charles Laughton made his debut under the first great foreign director to enter our arena. Theodore Komisarjevsky—the confirmation of Granville-Barker's work by George Devine at the Royal Court in much more recent days—all this and much more confirmed our native expressiveness in an awe-inspiring way and led us to build a long overdue National Theatre, which after a decade of backbreaking preparation, like an athlete preparing for a marathon—and who knows better than I do?—is now ready to take flight under the inspired leadership of Peter Hall into realms which few of us have ever dared to envisage.

Thus, within a mere 50 years the British theatre has attained world stature. Its performances are everywhere welcomed and relished. This has been partly effected by regular—though all too little—transfusions from the Arts Council, but more particularly by the long stream of undaunted authors, actors and actresses who, by an unspoken but instinctive resolve and love of their native land, have determined to play their part in putting Britain into the top bracket of world theatre, to match in performance the benediction of being able to claim the greatest of all dramatists as their national exemplar.

They—even, I might say, we—have suffered many hardships and humiliations on the way thither, but we now stand like Christian in The Pilgrim's Progress at the Gate which leads to the Narrow Way, and the Path to Paradise, or something like it. Christian knocks on the door. In the clouds sits Lucifer, eldest son of Mammon, laying an arrow upon his fearful bow. He lifts it to his chin. The door opens and the Angel whose name is Promise grabs Christian inside and slams the door. Lucifer has already fired. The bowstring twangs, the arrow comes hissing through the air, and it buries itself in the massive doorpost. But Christian is already safe and sound inside, ready to pursue his destined journey. Only one question remains. We have the script, we have the costume, we have the bow and arrows. Who are we to cast as Lucifer?

My Lords, before the noble Lord sits down, may I ask him a question? He remarked that money is the cement of society. May I ask him whether in his view the position was any different before the Glorious Revolution rather than after it, with the importation of Dutch bankers and the creation of the Bank of England?

My Lords, I am afraid that I did not hear that. We should be better without this amplification system, as I think that the noble Lord's voice is admirably placed and without it I should have heard better. I can say no more for the moment.

My Lords, like many of your Lordships, I want to deal with that part of the Motion which concerns the arts. I am prompted to take part in the debate because of the important contribution that the regions can make to the arts. When we talk about the arts there is sometimes a tendency to concentrate on London, but I am glad that that has not happened today. I think that it is true to say that the arts nationally can flourish only if there is a strong base in the regions.

The Minister and many other noble Lords have illustrated some aspects of the richness of the arts in this country in the course of the debate this afternoon. It is true that many of the jewels in our crown are here in London itself. I want to see London remain a centre of excellence—indeed, the centre of excellence—not only in Britain and Europe but throughout the world. Like the noble Lord, Lord Gibson, I do not think that we should sacrifice the London arts in order to support the regional arts. I think that both have their rightful place in our national heritage. Therefore, I agree with him that it is essential that there should be additional funding.

Within the regions, as the noble Earl the Minister acknowledged, the arts have flourished, with the backing, incidentally, in many instances of the metropolitan county councils. The Arts Council has said that over the past decade or so working together with the local authorities it has been responsible for some noted developments. In my county of West Yorkshire some of those developments have taken place and I want to refer to a few of them. But, first of all, I want to say that the new developments and initiatives have not supplanted the traditional arts within the region. There has been a continuation of the music societies, there has been a revival of the brass bands, and the traditional dramatic societies have remained. The new developmetns have supplemented and complemented the traditional arts of the region. One can say, for example, that the Huddersfield Choral Society is now complemented by the Huddersfield Contemporary Music Festival.

Many of those developments have been funded by local government and in particular by the county council, not entirely, but on a pump-priming basis. That has been a means of getting them off the ground. One example of that is an example which the Minister gave when he spoke about new developments in the arts and referred to the art of dancing. Within West Yorkshire there has been a remarkable emergence and growth of dance companies. A few months ago some of your Lordships may have seen on "The South Bank Show" the Harehills Dance Company, which is combining some of the best of the disciplines of the traditional ballet with the enthusiasm and vitality of the West Indian ethnic group settled in the Harehills district of Leeds. Those who saw that programme will not need me to tell them of the talent involved in that company—a talent that sprang from grass-roots and would not have been recruited into dancing and traditional ballet through the normal channels. It was something that emerged from the community and something that needed help and backing in order to get it off the ground.

Another initiative to which I should like to refer is the Mikron Theatre, based in Marsden in Kirklees. At any rate two of your Lordships will know of this particular experiment or theatre. I refer to the noble Lord, Lord Montagu of Beaulieu, and the noble Lord, Lord Wilson of Rievaulx, of Kirklees, who are two of its patrons. The Mikron Theatre is based in a touring boat. It is a touring company, and it is based in a 70-ft. narrow boat. The company's skill really lies in its documentary style. Through a mixture of songs and sketches it tells the history of water transport in a very popular and very acceptable way. So here we have a combination of folk art and history.

A third and quite different initiative is the Yorkshire Sculpture Park. That is a recently established country park which is set in a country area popular for walking and picnics but surrounded by industrial towns. Here, again, we have an experiment that is attempting to reflect some of the history of the region and the future of the region through the artists. Who knows?—perhaps by encouraging the young sculptors in this way we shall produce people who will rival those other two famous sculptors, Barbara Hepworth and Henry Moore. One of the advantages of these developments is that they are not cloistered arts; that it is an attempt to bring art close to the people. I am not sure that I agree with the Minister when he talks about a middle-class lobby. Perhaps, the middle-class element in the lobby is the most vocal one. But I think it is a fact that more and more people are being involved in art. That is something that we should foster. I think it can best be fostered at local level by developments along some of the lines that I have been mentioning.

I am glad that the Minister mentioned Nostell Priory. Of course, that has also been mentioned by the noble Lord, Lord Charteris of Amisfield, and by the noble Baroness, Lady Airey of Abingdon. I should like to associate myself with the tribute that the Minister paid to the late Lord Saint Oswald. I have visited Nostell Priory on occasions when the house, the orangery and the outbuildings have been packed with different community and artistic events. I think it is very right and proper that the beautiful house, Nostell Priory, as well as its famous furniture and internal arts should be maintained and should be available not only to the people of Yorkshire but to the country as a whole. I am very glad that it has been saved in this way.

That aspect of our art links up with this whole question of popular arts. One of the new developments in recent times has been the popularity of the country homes—the traditional country homes which have been either taken over by the National Trust or opened by their owners. Through visiting houses of this kind, many people who would not go into an art gallery may have seen for the first time real pictures and pieces of art. I think we have to think of all these aspects, not only as part of maintaining the art tradition within the country but also of linking it with the economy of the country. The growing tourist industry does not refer only to London but also to the regions, and it is something that should be fostered.

This debate also draws attention to and is based on the need to review the arrangements for support for the arts. Despite what the Minister has said. I associate myself with the remarks of people like the noble Lord, Lord Donaldson, who said that the atmosphere in the regions is sour. I associate myself with those who are saying that in the regions there is a sense of uncertainty, and morale is very low.

The three projects that I have mentioned are at financial risk. The projects are funded certainly by the West Yorks metropolitan county. The Mikron Theatre was funded also by the Arts Council, who have now withdrawn funding from it. Many other projects in the county are also at risk, not least one of the very successful ventures in the theatre, the Leeds Playhouse, which is currently being relocated from the present converted sports hall, where it has been housed since it was set up, to a new location. The West Yorks County Council is contributing £1 million this year towards this relocation. The Leeds Playhouse is not on the list of theatres to be supported by the Arts Council.

I know the Minister has told us that there is to be £34 million additionally available to replace the funding from the councils that are to be abolished. However, there are two points about that. One is that the £34 million will not fully replace what is being spent in the current financial year and in the next financial year for which it is allocated. There will be a deficit in that way, and there will also be a difference in approach. The strategy that the county councils have brought to bear on the arts within the region will not be taken over by the Arts Council. The Arts Council will have its own priorities and its own projects which it wants to support. I am afraid that many of the new initiatives will suffer as a consequence.

Therefore, I join with those Members of this House who have said that the Government must think again about the provision of funding for the arts. Unless they do, I am afraid that the morale of all the various organisations and the progress that has been made within the last ten years will be in jeopardy.

My Lords, before the noble Baroness sits down, may I repeat one very short point that I made in my opening remarks, which I think has given rise to some misconceptions? The Arts Council has not yet announced—and I do not know what it is liable to announce—the extent of its regional provision. It has simply told me that there is liable to be some additional funding in regions as part of its strategy.

My Lords, I, too, want to thank the noble Lord, Lord Jenkins, for initiating the debate. I also thank the Leader of the Opposition and his party for allowing the time for a full debate. All of us are deeply grateful. The noble Earl begged me not to moan. The noble Lord, Lord Donaldson, has, of course, already said that at the National Gallery the purchase grant has been cut by something like £600,000 and that it will remain static at a new low for three years. By that time, the strength of the dollar and the remorseless rise in prices for masterpieces will compel the National Gallery, I suspect, to tell prospective vendors who want to sell a painting to the gallery under private treaty that it simply has not the funds available.

However, I am not going to moan. I have some sympathy for the noble Earl. He has explained that he had to find money to repair the roofs of museums and galleries. Roofs, in our climate, seem to be in need of perpetual repair. Modern architects today take their cue from Madame de Pompadour, who, as you remember, said, "Aprés nous, le déluge". I shall not moan, but I shall probe, King's College, Cambridge, has many ancient buildings. When I was Provost we paid a sum into a sinking fund for the renovation of the stonework and all the necessary repairs to its ancient buildings. Recently, the cost of repairing the stonework of the chapel was so enormous that we had to make a public appeal.

Owing to the energy of the present Provost, the appeal was successful within a short time. But does the PSA have no notional sinking fund for the buildings under its care? I can guess that there may be good reasons why the Treasury does not favour notional sinking funds. Surely, however, the corollary must be that the Government should find exceptional sums when a sudden disaster occurs. I am bound to say that, in this case, it seems to show some maladministration in the PSA in days gone by when, suddenly, £25 million, I believe, spread over a number of years, has to be spent on the roofs of the Victoria and Albert Museum. It is a bit hard that other museums and galleries have to pay for it.

A year ago, in the debate on the Getty Foundation and the danger posed by that foundation to our own heritage, one noble Lord said that he did not mind if all the paintings in private hands went to California while another noble Lord said that all purchase grants to galleries and museums should be annulled and the money given to promote arts and crafts in this country. I do not intend to deal with those arguments. I do not believe that they command much support in your Lordships' House. However, I hope very much that the noble Earl does not think that the National Gallery has enough paintings and does not need to acquire more. I am sure that he does not.

Of course, there are some galleries that are marvellous mausoleums—the Wallace Collection in our own country, or, my own favourite mausoleum in the world, the Frick Collection in New York. They are museums where no paintings are acquired at all. But a national gallery should be able to acquire new paintings from abroad, as, for example, when we acquired from Germany the Samson and Delilah by the young Rubens, or when, through the good offices of the noble Earl himself, we got the superb portrait by David from France.

One of the troubles about acquiring paintings is that the Government have put a ceiling on "in lieu" acquisitions. That sum, this year, has been halved. As a result, the Tate Gallery is now being asked to pay over £1 million for a painting what should have cost it nothing. The owner, now dead, wanted that painting to go to that gallery. Another owner of paintings which the National Gallery would dearly like to acquire may, I fear, make other dispositions as a result of this policy. Why does the Treasury always frustrate schemes which Ministers have got through Parliament to save the heritage? Hugh Dalton invented the land fund. The Treasury pillaged it. This Government set up the National Heritage Fund. It now has inadequate funds, as the noble Lord, Lord Charteris, admitted. The "in lieu" arrangements enabled a Minister to say truthfully that no additional public expenditure was being incurred when the nation acquired a work of art. And when a painting is acquired in lieu of taxes it goes on show. That is a positive gain for the nation. You have to weigh that against the reduction in income to the Inland Revenue.

Demands for "in lieu" settlements do not occur every year. In a sense, the Revenue saves money for years when no applications are made. Why cannot we become good Europeans and follow the French, who have acquired a horde of modern masterpieces recently under their dation system?

It seems to me that if our museums and galleries are to continue to make major purchases, we have a choice of two models—the American model or the European model. In America, virtually none of the museums is given public money. Most have endowments, but they rely on wealthy patrons raising the money for purchaes. The boards of trustees are largely composed of exceedingly wealthy men and women. The system works because the prospective donors can set the whole of their purchase against taxation and, in some cases, can even keep for themselves the work of art that they buy during their own lifetime.

Admission to many of the national and civic museums and galleries is free. Of course, there is one variation. In the Metropolitan Museum in New York it is allegedly free, but you are requested to make a donation. Let me assure any of your Lordships who might think of insisting upon free entry at the Metropolitan that you will receive very rough treatment indeed until you pay your $3. A few years ago I asked the trustees of the National Gallery to reflect on this method of obtaining more funds. All of us, as trustees, thought it hypocritical.

Many will be the pleas today to go over to the American system. Naturally, I would rejoice if the Government gave greater tax concessions to generous donors. It is the only way to get substantial support from private sources, at any rate for the acquisition of paintings, with which I am concerned. The trouble is, of course, that although it does not increase public expenditure, like the "in lieu" system, it does reduce income to the Exchequer. I suspect that the Treasury will argue that if greater taxation relief is afforded, purchase grants should vanish. I realise that the noble Earl will say that he cannot, before the Budget, say anything on this subject; but he will be aware that the noble Lord, Lord Fanshawe, is to ask an Unstarred Question on this matter as soon as possible after Budget Day.

The other model is the European model. In this model the state does indeed make purchase grants to museums and galleries, but they are partially paid for by the public being charged for admission. I know all the arguments against such charges. I deployed them in opening the debate in your Lordships' House in 1971, when museum charges were imposed. Two years ago I forecast that what now is happening would occur; namely, that purchase grants would be cut and broad hints would be given by some people that the remedy lay in the hands of the galleries that had been cut—the remedy, of course, of charging for admission.

I am aware that this is an issue on which opinion has been changing. One intelligent argument I have heard deployed in favour of charges is that the days are past when we were such a philistine country in the visual arts that we needed free admission to educate public taste. Today, you have only to see the public flocking into exhibitions at the Royal Academy and the Hayward Gallery to realise how things have changed. Then why not follow the continental pattern? Of course, you can have a variation; for instance, entry free on Mondays and a season ticket of £15 a year for those who want to drop in for a quarter of an hour or so.

But I do not think that the large national museums and galleries are yet driven to impose museum charges. Their staff, I must tell your Lordships, are, I believe, implacably opposed to this. But museum charges hang on another proposition. There is another prong to the European pitchfork: the export of works of art is forbidden from EEC countries. That is how our neighbours in the Community protect their heritage. The admission charges enable them to give not the full market price but nevertheless a substantial price to those who, for whatever reason, wish to sell their treasures.

In this country owners of treasures are protected by the Waverly Rules. If anyone urges museum charges I would say, "Ah, but in that case you must think the time has come to bend the Waverly Rules?" I do not advocate going over entirely to the European model. To do so would be to destroy the lucrative market which our art dealers have created and which brings wealth to this country. In the Getty debate I suggested that each national museum ought to be allowed to present to the Government a list of incomparable masterpieces of the heritage in this country in their own field—masterpieces which should never be permitted to leave the country. I pointed out that the National Gallery has in mind something under 200 paintings in this country on which we should like to be asked if we were interested in purchasing them if they ever came on to the market, though we do not bind ourselves to do so. I should not for one moment suggest that none of those 200 paintings should be allowed to be exported. But I did say that according to the Director of the National Gallery about 25 to 30 paintings were of supreme beauty, and I suggested that they must at all costs be retained in this country. I called this list the Delictissima Desiderata list.

I realise that some noble Lords will oppose such a policy. Indeed, as soon as I sat down in the Getty debate the noble Earl, Lord Perth, denounced me at once in unmeasured terms. In what way do chattels differ from land? Every landowner knows that he may be refused planning consent if he applies to use part of his land for industrial or business purposes. He may even be refused permission to convert a barn into a dwelling for a family. It will be said that the kind of thing I have suggested discriminates unfairly against individuals. So does planning and property law. We protect the national environment by such laws. Why should not we similarly protect the national heritage? I hope very much that the noble Earl, Lord Gowrie, will feel that he can reply to this point. If he declares it is totally unacceptable then I may say to him that he is not being the guardian of the national heritage but the guardian of his class. In any case, I implore him to give an undertaking to review the Waverly Rules.

I should now like to turn to broadcasting. The Committee on the Future of Broadcasting reviewed extensively the methods of financing broadcasting. The other day I was somewhat horrified when a noble Lord on the Opposition Front Bench asked at Question Time whether it would not be a good plan to finance the BBC from taxation. I cannot conceive that the Government are willing to do that. Of course it would mean political control of broadcasting, because all the rules the Treasury has over public accountability and all the rules that Parliament has, including those of the Public Accounts Committee and the Comptroller and Auditor-General, would immediately apply to the BBC. In that case the Government would become directly responsible for BBC programmes. In Australia, Mr. Gough Whitlam ordered the Australian Broadcasting Company to cut down in current affairs programmes. It refused. He cut its budget by the appropriate amount. Surely none of us want that here.

Some suggest that if revenue from the levy and higher rentals to the companies were raised by the IBA, BBC income could be increased by pooling the licence fee with this additional income from advertising, and the BBC's problems could then be solved. After all, the ITV companies in the South subsidise television in Scotland and Wales. Why should not the IBA subsidise the BBC? Why not increase the levy and use the difference for the BBC? That proposal runs directly counter to the Treasury's implacable law against hypothecation. The Treasury—rightly, in my view—prevents the hijacking for a special interest of money which could go to health or education or any of the other things for which the Treasury provides. I do not think a solution of pooling income from ITV and the BBC would work.

What does this leave? It leaves advertising. One could of course go over to the West German pattern of limiting advertising to no more than 15 per cent. of revenue. There is this difference: the Germans are very high-minded about broadcasting, and I think their service is the best after ours in Europe and arguably superior in its presentation of news. They have a genuine fear of, and a genuine repugnance for advertising. I rather fear that British Governments do not; and if 15 per cent. were allowed this year the Government would find it convenient to raise that figure just a little higher each time there was a review in order to avoid the odium of raising the licence fee.

There is another point here. Directly you insert advertising, the BBC's scheduling is bound to be affected, and all programmes from 5 o'clock to 11 o'clock will carry advertising and be geared to getting as high a rating as possible. Incidentally, I have never talked to an employee of the BBC who was not opposed to advertising. They know it must change the quality and the nature of the service.

I think, however, that the BBC ought to take a really deadly look at its activities. If it complains of lack of money it is partly because over recent years it has adopted a "Me, too" attitude to innovations. Local radio, breakfast television, pop music on radio, satellites: you name it, the BBC says it must do it. Yet most of these activities are far more appropriately done by commercial companies. So my first plea would be for the BBC to sell off the local radio stations and breakfast television, to take a hard look at Radio 1 and Radio 2 and to ask top management to stop being dominated by ratings and remember they are running a national service with a great cultural tradition behind them.

The second thing is to ask whether essential services cannot be produced more cheaply. If video tape were substituted for film very large sums, I am informed, could be saved. Why is it not done? It is not done because the unions would object. The BBC has got to renegotiate with the unions a large number of practices, and it must run the risk that the unions might pull the plug and our screens will be dark. But whereas ITV loses money if its screens are dark, the BBC would get wealthier if it had a strike. I feel bound to say that I have been disturbed in recent years by what I regard as lack of a really driving top management in the BBC. I do not mean the governors. The governors are the watch-dogs of the public interest and they should never try to run the BBC. But they have a duty to judge whether those who are running it are the right men for the job and have the necessary managerial skills. I wonder how many of the top executives in the BBC have been on a course in a business school?

I ask myself this also. If universities have been cut by between 8 per cent. and 14 per cent. in the past three years, and all our research councils have been cut, and now the arts are being levelled off, how can the BBC, which is financed from public subvention, hope to escape the Government drive to keep public expenditure within bounds? After all, inevitably the licence fee is regarded as part of Government policy.

I have tried to restrict the temptation to plead that the arts and broadcasting should be exempt from the Government's declared policy of reducing public expenditure. I know that they want people to pay for what they like instead of for what committees and bureaucrats tell them they ought to like. But should we not, perhaps, remember that the massive numbers who go to concerts and galleries today would never have done so but for the BBC's marvellous policy of introducing people to things which they may at first have thought that they did not want, but they then found that a new world had opened up to them?

In fact, I have some sympathy for some parts of the counter-revolution which the Government are trying to achieve. Public bodies are very obdurate. They refuse to rationalise resources and so what else can the Government do but impose cuts upon them? The noble Earl, Lord Stockton, is continually praised for lamenting the breakdown of the mid-century consensus, and with feline skill he suggests that somehow this might be connected with a change of leadership in the party. But in those days consensus was easy to obtain. It collapsed in the 1970s, after the oil crisis and high inflation, when rampant syndicalism—which produced impotent management—made it impossible to get general agreement about the best way in which to obtain prosperity and to maintain full employment.

I should like to conclude on a rather more controversial but general point. Where the Government belie their own policy of curbing public expenditure is in the enormous expenditure now on defence. Let us consider the following events. First, Parliament refuses to consider the Ridley proposals in 1980 for a Falklands settlement; then it decides to cut expenditure and dismantle the Navy; then, very rightly, deciding that we must defeat the junta's forces, the Navy is reassembled. After victory, instead of negotiating a settlement from strength, millions of pounds are spent on Fortress Falklands and the defence cuts are forgotten. Or take Trident. By how much have the costs of this weapon escalated with the parity now coming between the pound and the dollar? Why has not President Reagan been told that we can no longer afford the weapon so long as the American deficit stays where it is? Does anyone believe that, if the delivery of Trident were delayed by a few years, the Russian Army would be seen marching down Whitehall with snow on its boots?

The Government seem to have got their priorities in a twist.

My Lords, will the noble Lord allow me to intervene? I intervene only because, rather against my advice and my will, I have agreed so much with most of what the noble Lord has said. The noble Lord is a very old hand at the public game and he must know that he cannot make cross-arguments from one whole arena of national policy to another in this way. I hope that he will not spoil an admirable speech on the arts by leading us into a red, or perhaps a stars and stripes shaped, herring on defence.

My Lords, I fear that the noble Earl does not really face the whole thrust of Government policy and all its implications for every kind of expenditure. However, let me leave it there. I suggest to the noble Earl that there is one reason—and I have just stated it—why there are few pounds for health and fewer pennies than there might be for the arts.

. My Lords, it is always daunting to follow my noble friend Lord Annan. However, with regard to what he said about the "in lieu" provisions, perhaps I may take up the situation at the Tate Gallery. Until very recently, I was chairman of the trustees of the Tate Gallery. Perhaps in his final speech the Minister will reply to the situation that I am going to outline.

Sir Roland Penrose, who was an old friend of mine, had in his possession one of the greatest paintings that had been painted in the 20th century by Chirico. He told me on a number of occasions that that painting was going to the Tate Gallery. As noble Lords may know, he had great associations with the Tate Gallery. He died the other day and the painting was offered, according to his wishes, to the gallery in lieu. The reply came back, "Oh! It is too late, I am afraid. The ceiling on 'in lieu' is now fixed and it cannot be accepted". If Sir Roland's wishes are to be followed and if the nation is to acquire one of the greatest paintings of the 20th century, then £1·25 million—I think that that is the figure—must be found out of taxpayers' money to buy that painting.

The Tate Gallery went to the Minister and asked whether the Government could offer any help, As I understand it, the Minister was kind enough to say to the new chairman of the trustees, "I shall give you permission to mortgage your next year's grant, if you so wish". Therefore, the gallery is now deciding whether it will purchase this painting and find itself—because of certain other commitments—with absolutely nothing in the kitty for next year were any painting of great validity to arise which ought to be acquired for the nation. That is the ludicrous situation about the "in lieu" provisions.

I do not know whether my noble friend Lord Annan realised how amusing it was that in his speech he constantly referred to the behaviour of the Treasury, therefore highlighting the somewhat ludicrous position in which the Minister finds himself wearing the two hats of the Treasury and the Minister for the Arts. That is all that I wish to say about the "in lieu" situation.

I should now like to turn to the Minister's speech. If I may say so, it was one of the most brilliant but specious speeches that I have heard delivered in this Chamber. Who on earth would ever have realised that there is at this moment a major crisis in the arts world? When the noble Earl listed, in the first 10 minutes of his speech, the magnificent and wonderful artists that this country has produced in the last 40 years, who would have realised that the reason why those artists now exist is almost in every case due to the subsidised arts which have been built up over the last 40 years? It is no good mentioning great pianists, great actors, great orchestral players. Where would they perform unless they had concert orchestras, buildings or theatres in which to display their arts?

My Lords, the noble Lord is making a very serious accusation. All I was saying was that these artists in many cases are the products of our mixed and plural method of funding the arts from sources such as central Government, local govern- ment, individual donations, consumer contributions and sponsorship. It is that continuing system that I am wholly pledged to maintain.

My Lords, the noble Earl the Minister keeps on coming back to private enterprise and to the amount of private money which goes into the arts. Do let us face realities. As I understand it, £10 million is necessary to run the Royal Opera House—the one institution which can, for various reasons (many of them purely snobbish) obtain large sums of private money. Yet still under 5 per cent. of the funding of that opera house comes from private money. Does the Minister really think that Mr. Beckett's plays would be put on in London by IBM? Does he really think that any experimental drama would appear in this country if we had to rely on the Midland Bank?

My Lords, the noble Lord is, I think, wilfully misunderstanding what I said. Of course I do not think that business sponsorship could by itself support the arts in this country. I would refuse to serve as arts Minister if that were policy. It is not policy. It never has been policy. The noble Lord must listen to what I say. He is an experienced criminal lawyer and he knows perfectly well what I said. We are running a mixed economy. There are a plurality and variety of sources of funding. I intend to maintain central Government funding. I intend to look for growth elsewhere.

My Lords, I hope that there is no sinister implication being drawn from the fact that I am a criminal lawyer. I am devoted, if I may say so, to the Minister personally, and I admire him greatly as a debater, but some flak will go across the Chamber inevitably in what I have to say. I am bound to tell the noble Earl that in the eyes of those whose work is in the arts in Great Britain at the moment his policies for financing the arts are regarded increasingly as misconceived and potentially disastrous.

It is generally felt that there is a fundamental contradiction between the two roles that he sets out to fulfil. They are incompatible and they are incongruous. He has, my Lords, become a veritable ministerial oxymoron or, to perhaps put it more appropriately so far as the noble Earl is concerned, he is trying to operate in an impossibly grey area, lost between the Stygian failure of monetarism and the bright sunlight of the success and the vitality of the arts.

I intend to ask the Minister some questions and dwell on some of his perceived failures. The job of a Minister for the Arts is surely first to decide where the arts should stand in society. Does he believe that great nations are mainly remembered not for their politicians or for their economic ups and downs, but for their creative genius? Does he agree with the first paragraph of the House of Commons Select Committee report which condemns the fact that the Government still regard the arts as a marginal activity, whereas they are in reality,

"part of the fabric of a civilised and prospering community".

Does he agree, above all, with the committee's conclusion that British arts organisations are irresponsibly under-funded? Does he agree with the chairman of the Arts Council that the findings of the Government inquiry into the financial viability of the RSC and the Royal Opera House that for them to operate efficiently and effectively their subsidies need a 20 per cent. uplift, now applies across the board for all the Arts Council clients? If he does agree then he must accept that there is overwhelming evidence that these organisations carefully, systematically built up over 40 years right across the country with taxpayers' money on behalf of the public, cannot now do the job that they are asked to do, and for which they have been created, efficiently and effectively on the subsidy that they are now receiving.

Who then is to blame for this national irresponsibility? My Lords, it must be the Treasury, in which case the Minister surely should be seen fighting his corner against the Treasury and his colleagues for financial responsibility, efficiency and sufficiency for the arts. Instead, what do we see? We see a Minister in the somewhat incestuous posture of fighting with himself in a state of permanent self-immolation.

I wonder whether the Minister fully understands even now, if I may say so with great respect, the fundamentals of arts funding. May I remind him of these matters. First of all the Select Committee said:

"The income generating and export earning functions of the arts are still not sufficiently recognised by Government."

Secondly, Sir Kenneth Cork told the committee:

"The spending potential of overseas visitors to the RSC in London and Stratford must exceed £20 million a year".

Thirdly,

"45 per cent. of those tourists who spend £4,000 million in the United Kingdom every year choose the theatre as their number one attraction".

So says the tourist Board. Then the Select Committee again said:

"Arts grants should be regarded as investments, yielding a substantial positive return to this country."

Fifthly, the Conservative arts discussion paper edited by the noble Earl's predecessor, Norman St. John-Stevas, said:

"Arts can genuinely be said to pay their way".

Sixthly, and lastly, an Arts Council study carried out by their brilliant finance officer, Anthony Field, established that the Treasury got back £300 million from the investment of £1 million in the Arts Council.

In addition to all this authority—and the Minister will tell us if he agrees with it—the commercial spin-offs of the subsidised arts are legion. West End successes, British films, TV serials, would not happen without the technicians and the artists from the subsidised companies. Look, my Lords, at the "Jewel in the Crown", which last night won so many of the BAFTA awards. The actress leading the RSC won the main prize. The director, straight from the National Theatre.

The huge success of the musicals "Cats" and "Starlight Express", directed by whom? Trevor Nunn from the Royal Shakespeare Theatre. These musicals trace back directly to a decision to which I was a party when I was vice-chairman of the Arts Council, and much derided at the time, for the Arts Council to fund a revival of "My Fair Lady". And so from that to the production of "Guys and Dolls" at the National Theatre.

Faced with the steady erosion of this remarkable worldwide success of the British arts scene what has been the reaction of the Minister?—

"I can in no way dissociate the arts from the Government's economic and fiscal policy. To do so would be damaging to other parts of the economy."

And yet a few moments ago he was taking my noble friend Lord Annan to task for daring to mention another part of the economy. That is, if I may say so, the policy of the parrot. Government is, as has already been said, a matter of priorities. We are here talking of a few million pounds, when one nuclear submarine costs the taxpayer £600 million.

When the noble Minister said that to up the arts funding sum of money would be a sop to the professional middle classes, that is surely a slight indication of the attitude to the arts by so many of the noble Minister's colleagues. Does he really believe that in this day and age artists who act, people who administer the arts, are all middle-class, upper-class, educated élitists? To produce £25 million—and I do not quarrel with it for I think it was an excellent thing to do—to save three of the great houses of this country, is that a sop to the middle classes; or does he mean that it is a sop to the upper classes? The £25 million to the fund of the noble Lord, Lord Charteris, is an excellent thing. But there is money there which can be produced and for an excellent reason. Please, do not let us have talk about money for the National Theatre being a sop to the middle classes where money for three great houses of the British heritage is considered not to be so!

My Lords, may I answer that point while it is fresh in the mind of the House? What I said—and I made it very clear when I was talking about the houses—was that they were not aristocratic mausoleums but living, social assets. I think that if the noble Lord were to check Hansard, he would see that I used words to that effect. In respect of what I said about the professional classes, again this was to do with arguments for a large quantum increase in arts funding, which would be desirable in many ways for its own sake, I agree, at a time when Ministers (for reasons which I have argued on many occasions, including today) were trying to contain costs in other parts of our welfare services. That would be a signal that the professional middle clases were looking after their own—not that I think that art is the province for them.

My Lords, the professional middle classes looking after their own! Do the arts of this country belong to the professional middle classes? It is high time that the noble Earl woke up, came out of his Ministry and went about the country to see what is happening in this year of 1985. And, when he comes out, would he go to No. 10 Downing Street?—because the philosophy of our Prime Minister surely embraces backing enterprise, backing success, backing hard work and investing in what she would call, and rightly call, the greatness of Britain. What a case to argue at No. 10! I would do it on legal aid. All that the Minister seems to do is to huddle in his tent at Great George Street and pull his Treasury balaclava closer over his eyes.

My Lords, may I now shortly refer to the institutions for whose protection and development the Minister is ultimately responsible; and, first, the Arts Council. I must tell the Minister that in the view of many clients and of many working at 105 Piccadilly, as has already been said, the Arts Council seems to have lost its way. Daily, it has become more like a Government department with a staff of civil servants. It seems to face towards the Government; whereas in my day and in the day of my noble friend Lord Gibson it faced towards the clients. As a previous Arts Council vice-chairman, I must say that I was shocked to see the present chairman publicly attacking the director, Sir Peter Hall, of one of his greatest institutions as if he were some troublesome member of SOGAT, in language more usually found in the tabloids of Fleet Street.

Such a thing would have been inconceivable in the days of the noble Lord, Lord Gibson, and Sir Kenneth Robinson, both chairmen under whom I have served. This situation requires the closest attention of the Minister. Sir Peter Hall is a great director of international standing. He went into the National Theatre complex in 1976 when the place was a shambles. He forced the builders to complete and, by Herculean efforts of organisation, he got that complex working. Now, in only nine years, its three auditoria are going full blast. He has managed to create a centre of drama which is literally unequalled throughout the world. The building is a unique, living organism open throughout the day, to where ordinary men and women can go, meet their friends, listen to music, buy books or go to the theatre at a price that they can afford—the very opposite of élitism in the arts.

It costs £2¼ million to keep that complex open before a single artist enters through its doors. The firm of Coopers and Lybrand, employed by the National Theatre, have analysed the grants given them by the Arts Council since 1979. I tell the Minister that among the inaccuracies in his speech, one of them was that those grants stand at 4 per cent. below RPI and 13 per cent. below average earning index. It is the average earning index which is accepted in the arts as the proper measure for the performing arts. Those facts have been issued by the National Theatre and they are available. And from the Ministry come out other figures which are not accurate. During the last six years, alone among the national companies, the National Theatre has operated without a deficit; it has raised over £1 million in two years through sponsorship and patronage and produced a quarter-million pounds profit in catering. Not a day has been lost from labour troubles.

What does the Chairman of the Arts Council, Sir William Rees-Mogg, say in those circumstances:

"If I were running a business"—

he says in the Sunday Times—

"and my reserves fell by 2½ per cent. I would think I was making a foul of myself if I said that such a situation was intolerable".

Who is saying that! Who was it who was running The Times newspaper a little time ago? What business was it that was losing something like £1 million, was it, a week or a month? And what were the labour relations like in Grays Inn Road? Not one day on South Bank has been lost since 1979 at wages paid below the national average and lower than in any other national company in the country. That is Sir William's view. And what happened to Sir William and his deficit? He was bailed out by an Australian millionaire.

The National Theatre is not asking for that. It is merely asking for a minute measure of assistance from the Arts Council. Sir William attacks the arts lobby. He, the Chairman of the Arts Council, should be the spearhead of the arts lobby. What is he doing attacking the arts lobby?

Those are some of the matters which I wish to put before the Minister. I say to the Minister that there is a tremendous job of rebuilding to be done in the arts. I warned him about this crisis 15 months ago in this House and the time is rapidly running out. I say this at the end. Some poet, driven to his garret by the Arts Council cuts, will no doubt now be composing an elegy for the Minister. Perhaps I might call it the "Gray's Elegy Mk II". But for the moment, until that poem is published, it still seems to me that there are two well-known lines from "Gray's Elegy Mk I" which are perhaps applicable to the Glory of the Garden:

"Full many a flower is born to blush unseen,

And waste its sweetness on the desert air".

My Lords, I must agree with the noble Lord, Lord Hutchinson of Lullington, on the talents of Sir Peter Hall—a man of great talent. Many tributes have been paid to him. I had the fortune, or misfortune, to be the builder of the National Theatre, and while I see Sir Peter in many roles, a builder manqué, never. Confusion and muddle there was, and he, like all of us, played his part in it.

In this debate and in debate generally the arts and the heritage are often thrown together—wrongly, I feel. They are disparate subjects, each with its own problems, each with its own band of supporters. The heritage is inherited, and is by its nature popular—gardens, houses, recognisable paintings. The arts have to be created, and are often unpopular—paintings, sculpture that involves the frying of fish, the piling up of bricks, the sweeping of leaves, canvases painted in primary colours, shapes the public cannot recognise, activities that the public suspect, a concrete perch. The list is endless.

The cost of maintaining the heritage, within certain parameters, can be calculated as it exists. The cost of contemporary art is uncertain: it is impossible to budget for inspiration. The Government have done much in the last few years to help the heritage. The Government's approach to this problem has been energetic, sensible and welcome. There have been no resignations over the saving of Kedleston Hall, Weston Park, and Nostell Priory. The Government see the necessity for these great houses and their contents to be kept, and they have acted quickly. I noticed in 1983, with pleasure, the inclusion of a commitment in the Conservative Party manifesto to examine ways of lowering the tax system and to encourage further growth in private support for arts and for the heritage. I wonder whether those inquiries have taken place.

The arts, on the other hand, are not about conserving monuments, saving recognised masterpieces or the fabric of our history, or that of our neighbour. The arts are about creation. The creation of great art is dependent not on money but on talent. The realisation of its greatness may take centuries. It is possible that our heirs in 200 years' time may look at the twentieth century and dismiss cubism and surrealism and all other such movements and call our age the age of the motorway. These great earthworks may be what they choose to conserve.

The Arts Council, however, are the body charged by the Government with the task of making these decisions now. The sooner the balance of funding moves from the conscientious work of committees to the whims of the dedicated patron, the greater the chance for the new. So I welcome the policy of my noble friend the Minister when he seeks to find extra funding for the arts from alternative sources.

The arts are in an expanding world. Each year they will find more uses for more money. This money must come from people who believe in them and enjoy them. The Government must set the atmosphere and encourage those people, for there is a limit to the length for which the taxpayer will tolerate new art.

My Lords, it is inevitable that this debate should concentrate on the arts; but broadcasting and its financing are mentioned in the Motion on the Order Paper and so I should be grateful if your Lordships will allow me to deal with two points: one of detail, but important detail. When I said in this House recently that there had been nine cuts in the operating income for the External Services—nine cuts in ten years—I was told that, on the contrary, there had been an increase, certainly over the last few years. There was less money given for operating services but it is dubbed an increase because apparently the capital costs (and there are capital costs in regard to the repair of transmitters and the like, some of it long overdue) are regarded as contributions for the operating expenditure on External Services.

In fact, in terms of the money available for making and transmitting programmes, there have been nine cuts in ten years. And I want to know—I realise it may be difficult for the noble Earl, Lord Gowrie, to answer my question without notice but I hope he will arrange for an answer—how it is that there can be a reduction in the money that is needed for the preparation and broadcasting of material, and the Foreign Office can claim that there has been an increase. I would very much like an explanation of that.

Add to that one other factor. Inevitably, with the falling value of the pound, more money is needed in respect of some overseas services in order to meet the costs: very sensible. The British Council has had an addition of £1.4 million for that purpose. The Foreign Office has not forgotten itself: there has been an increase of £800,000 in its budget. But to the External Services, the loss in respect of the fallen pound has been a million pounds. They are receiving nothing in respect of the fallen pound.

I want to urge on the Government that playing with figures in order to suggest that more money has been given, whereas in fact the amount of money for the organisation, for purchases, for wages and so on in respect of normal broadcasting has been reduced, really is not a satisfactory position without a full explanation of what has happened. The noble Baroness, Lady Young, three weeks or more ago, replied to me that there was an increase. Yesterday, at Question Time, the noble Lord, Lord Trefgarne, referred to an increase. There has been no increase. Indeed, there has been a drop in the money which is to meet the cost of the services that are broadcast. And in reply to the noble Lord, Lord Hatch, yesterday, the story was repeated of an increase, which is in fact a reduction. It is a very important issue for the External Services that year after year they should have been cut in their operating expenditure and that, at the same time, the Government should claim that in fact there has been an increase in the allocation to the External Services.

The other issue I want to mention—and I will say little about it, for the noble Lord, Lord Ardwick, has dealt with it superbly well—is the "whispering" (if one can describe material in The Times as "whispering") that is going on in relation to the argument that the BBC should be financed by advertisements, as is Independent Television. We really need some reassurance on this matter quite soon.

To me, what is now being said takes the mind back 30 years to when I was Postmaster General, then the sponsoring Minister for broadcasting, at the time of the introduction of independent television. The losses, of course, were enormous at the outset: that was inevitable. But independent television very soon tumbled to the way of increasing income. It was to go trivial in its broadcasting. Anybody can win an audience by triviality—I very nearly said "rubbish wins", but that is going too far. Then, having reached the position of profitability, independent television realised that it was competing with a national service of quality. It wanted the same esteem as the BBC enjoyed, and before very long we had two services which were virtually equal in quality, as we have today. It is a very sad business, but we have to bear in mind that the existence of these two competing services—one commercial and the other public—side by side has demonstrated why we have the best television services in the world. It is a fact. I know that we enjoy referring to certain aspects of our life as being the best in the world, but that is certainly true. It came about because of the desire of both services to continue to exist and, in particular, the desire of independent television to share in the esteem that it knew the BBC enjoyed.

That leads me, I am afraid, to one important conclusion. It is said that we should substitute for that system of public service and commercial service, existing side by side, two or more commercial services and no public service. Bless my soul! We have only to look at America, which after all is almost wholly commercial, to see the sort of results one gets from that. It was a distinguished American in the broadcasting field who said that American television makes its money by doing its worst. If we get to the stage of two commercial services competing, even though the advertising income should increase so as to sustain both—but I am pretty certain that it would not—we shall be back to that competitive situation, an even worse competitive situation, of commercial service competing with commercial service and all that is best in British broadcasting would be down the drain.

I raise that point now and I am grateful to the noble Lord, Lord Ardwick, for mentioning it. I think of the uncertainty that must be felt. After all, The Times newspaper is producing material insinuating, if not suggesting, that commercialisation is the solution to the licence fee problem. It is very important for the Government to make clear where they stand on this issue. Uncertainty does no good, certainly within the BBC. I ask the Government to make it clear that whatever may be done about the licence fee—and I am not raising that issue in any form—they will sustain the basic principle of a commercial service competing with a public service, for upon that is based in very large part the excellence that we are enjoying from both today.

My Lords, this has been a very well-timed debate and we are very grateful to the noble Lord, Lord Jenkins, for initiating it. Speaking for myself, I must say that I appreciate his commitment to the arts rather than his preoccupation with nuclear war and I enjoyed very much his speech, with much of which I agreed. Like others, when I saw the title of the Arts Council's policy document, I thought it a trifle bizarre. I did not realise that it was not the Glory of the Golden with which it was concerned, and that the important bit was about digging weeds from gravel paths with totally inadequate implements like broken dinner knives.

It is, of course, inevitable that when any important interest fails to get the support which it expects, or to which it feels it is entitled, there is an outcry, and the arts world is more articulate than any of the others. But in this case, the reason for the strong reactions to the Arts Council's policy, and to the Government's attitude to the arts, is deeper and more fundamental. We are in a period when the problems of leisure are becoming of increasing importance as a result of unemployment, early retirement and the reduction of working hours. This is combined with the greater sophistication derived from education and an easier access to a variety of art forms through television and broadcasting.

In the '50s and '60s, progress in meeting the growing public interest in the arts was inspired to some extent, and strongly supported by, the Government and the Arts Council who were assisted by the local authorities, and of course with the addition of private patronage. There was the very remarkable development of drama and music, to which reference has already been made, and also of the crafts, such as silversmiths and ceramics, of sculpture and painting. Art during those two decades was becoming not the privilege of a few, but the occupation and interest of people everywhere.

Now the arts world suspects that the factors which made all this possible—money and encouragement from the powers that be; that is, the Government—are gradually beginning to dry up and that the motivation of the '50s and '60s is no longer there. It is the sudden feeling of insecurity and alienation that has produced the turmoil in the Arts Council and the outcry from almost every quarter of the arts world. If I have interpreted correctly the speech of my noble friend Lord Gowrie, the further development of the arts will not be primarily the responsibility of an enlightened authority—the Government and the Arts Council in this case—but will be dependent upon the discretion and commitment of businesses, of companies and of shareholders; again, supported to some extent by local authorities. This, at best, will lack continuity and coherence and, at worst, will be subject, as one person put to me very recently, to the whims of the directors on the board or, more probably, to the whims of their wives.

I have intervened in this debate simply to illustrate the point that I am trying to make from my knowledge of the problem in one provincial city, Colchester. I was for many years chairman of the trust which built in the late '60s the highly successful Mercury Theatre and I am still one of its Patrons. I am president of the Minories Art Gallery in Colchester, which I think is regarded by Eastern Arts as the flagship of the galleries in the eastern region. It also came into existence in the late '60s as a consequence of the generosity of a private benefactor.

My noble friend Lord Gowrie visited both the theatre and the gallery in the autumn, and I should like to record our gratitude to him for his interest and advice. I have never had anything to do with the artistic policies of either the theatre or the gallery, but only with the problem of raising money from every conceivable source to sustain and develop them, and to encourage the professional management in coping with the unending financial problems which these and all regional centres of the arts have to face.

Let me say straight away that hitherto we have had generous support for all that we have planned and hoped for from both the Arts Council and from Eastern Arts. It was therefore with great interest and encouragement that I read of the intention of the Arts Council to support to a greater extent regional art. I also noticed that Eastern Arts was less generously treated financially by the Arts Council than any other region. Our experience in Colchester is typical of the country generally. The present situation is that we have exhausted practically all the available sources of finance. The Colchester Borough Council has been particularly generous to the Mercury and supports the Minories. We have a number of business sponsorships—I think it is something like 20—from local companies. We seek to add to their numbers, as we were advised to do by my noble friend when he visited us.

Both the theatre and the gallery have energetic and devoted supporters clubs which tap the pockets of private citizens and neither of these started with any burden of debt at all. Both are efficiently and economically managed. No big salaries are paid. The average wage of an actor at the Mercury is £2·39 an hour, not taking into account the time spent learning his or her part, which compares with £2·50 an hour paid to a daily cleaner in London.

Last year the Mercury had an average attendance of 77 per cent. and a total of 113,000 members of audience. This is a small theatre with a maximum capacity of 500 which can be, and frequently is, reduced to some 420. The theatre runs a drama workshop for young people and takes drama to the schools. On the other hand, the art gallery, the Minories, besides the Arts Council exhibitions it displays, exhibits representative work of professional and amateur talent which is attracted to our part of England which, after all, gave us our greatest landscape and greatest portrait painter. It supports local crafts; silversmiths, jewellers, ceramics, photography and textiles. It has its workshop for young people and adults, and last year mounted and financed three touring exhibitions which toured centres all over the country. Both make an essential contribution to the quality of life in our town and to the region around it.

Yet both today are facing financial problems which, unless alleviated, are bound to reduce the standards of excellence which they have achieved during the past 10 to 15 years and could eventually put in jeopardy their continued existence. Although I am speaking in the context of one town, the problems which this theatre and this gallery face are symptomatic of what is happening to theatres and galleries all over the country. Now, in spite of the policies of the Glory of the Garden, the Mercury will suffer a 5 per cent. reduction in real terms of its Arts Council grant in the year 1985–86. The accumulated deficit of the Minories over the years has been reduced only by a providential legacy which is unlikely ever to be repeated.

I do not think that anyone connected with provincial art wants to be helped at the expense of London, because we are dependent on each other. London actors play in provincial theatres. It is there that most of the leading television actors and actresses go to refresh themselves by playing before live audiences, which is essential to their craft. It is there that the new plays by new playwrights are often first staged; and whatever my noble friend Lord Gowrie may have said, there is today a very serious lack of both. The reason is that those responsible for mounting plays, particularly in London, are not prepared to take on the financial obligation of putting on experimental plays. The result is that these plays are not produced and perhaps not written. Therefore we in the provinces are starved of the plays on which previously we were relying coming from London after a success to fill our theatres in the provinces.

It is in provincial art galleries that up and coming artists get first their chance to exhibit and their first step on the ladder to success. The provincial theatre and gallery form an essential part of the vitality of the artistic life of the nation. It was, after all, as has been said by the noble Lord, Lord Miles, and others, the wonderful flowering of the British theatre during the 1950s and 1960s that attracted millions of visitors and their money to London to the great advantage of the country; and to a lesser degree I think it still does. Investment in the arts is good for the quality of life of the whole nation. It also makes economic sense.

I am not asking that more money should be provided for theatres and galleries in the regions at the expense of London. I am asking that the total available from the Government combined with money coming from local authorities, businesses and private patronage should be sufficient to give the greatest of all the achievements of this country in the field of culture, the British theatre and the splendid inheritance of Britain in painting and craftsmanship, the resources needed to enable them to develop not only in quality but on a scale sufficient to meet the growing needs of the leisure interests of the public throughout Britain.

The Arts Council asked for £120 million for this year. It received £105 million or, in practice, rather less. As the noble Lord, Lord Charteris, has thanked the noble Earl the Minister very properly, and the noble Lord, Lord Hutchinson, has referred to it, a week or so ago £25 million was found by some financial sleight of hand to buy three historic houses. If it can be done to safeguard for the future a national inheritance which is represented by Kedleston and the others, would it not be possible to find another £15 million or £25 million to safeguard and to advance an even more important part of our national inheritance—the dramatic and artistic achievements of the nation?

My Lords, I have no vested interest in this debate. I am going to limit what I say to the theatre and to the opera. I believe that my position may be in this Chamber somewhat unique. I believe that I am the only performing opera singer in your Lordships' House at the current time. But, my Lords, you may be equally relieved to hear that I have no intention of bursting into song. Nor am I going to resort—and I hope this will afford your Lordships some relief—to a burst of Old Bailey rhetoric.

I am by this experience perhaps put in a privileged position of being equally at home on the stage and in the auditorium. I am enabled therefore to tell your Lordships of the very great concern that is sincerely felt by a large number of persons who are involved in the theatre as to their security, as to their future, and, particularly, as to the effect of the Government's policy. Let me say that at this moment my noble friend the Minister is regarded by many of the people I know well and whom I have had the good fortune to meet as being without doubt the best Minister for the Arts under whom, in a sense, they have had the enjoyment of serving. So anything I have to say is not directed to him in any way personally or in any sense in that regard. Their concern is about the dual role, about which the noble Lord, Lord Donaldson, spoke earlier, as to which hat my noble friend the Minister wears at any particular time. Not being expert in these areas of activity, they feel that there may be some conflict of interest between what my noble friend the Minister has to say with his Treasury hat on and what he has to say as the Minister for the Arts.

There is also a similar feeling about the Arts Council. Those who are on the other side of the auditorium feel—and have expressed in surprisingly strong language to me fairly recently—that the Arts Council used to be their advocate and put their case to the Minister. I am not in a position to say what the reality of the situation is. All I can say is that they feel that the Arts Council is a Government quango. From what my noble friend the Minister has said I am sure that that is not so, but I make this point because there is here a very dangerous illusion, on the principle that there is no smoke without fire. There may be some degree of proof, or there may not, but it is something that ought to be removed from their beliefs at the earliest opportunity.

I do not propose to burden your Lordships' ears with a lot of figures. My noble friend the Minister said in his opening address that the basis on which some figures were computed varied considerably; in other words, that elements included in one calculation were excluded from another. I should like very briefly to relate that which I have been told is the reality of the situation, and then to ask my noble friend the Minister whether there is in fact any reality in these statements. I shall be very happy to have his answer, whenever it is most convenient for him to give it.

There are two brackets to these figures. They are short, and I shall not burden your Lordships with them for very long. Four years ago, as I understand it, £6 per head was the amount of public money spent on the theatre in this country, compared with a figure of £16 in Germany at the same time and £23 in France. I understand that the current figure in Germany is £22 per head of public money.

I shall try to present that picture in a slightly different, though related, way. In the United Kingdom, I understand, box office income is expected to contribute 50 per cent. of the costs, whereas in France, as I know for certain, box office income is supposed to contribute only 22 per cent. I know that in Germany a different situation applies, but I am sure it is within your Lordships' knowledge that France and Germany have two very contrasting systems. One has few theatres, but they are well funded, and Germany has many more theatres and the system of distribution is quite different between central Government and the Länder, which translated—and I am no German language expert—means municipalities. I believe that the cost of that is split 50–50. Those figures, if they are accurate, show that United Kingdom theatres and opera are under-funded in relation to those of France and Germany. I should like to know whether there is a basis for the reality of those figures, or whether they are purely hypothetical, or only partly hypothetical.

The next matter to which I should like to refer comes under the heading of self help. In America a company which pays a substantial amount of money towards the Metropolitan Opera or one of the other opera houses is allowed that donation in full against tax. The noble Lord, Lord Donaldson, said, if I recall his speech correctly, that they are in some difficulty because that system is costing the Internal Revenue Service of America too much money.

Be that as it may, the other end of the spectrum is in the United Kingdom, where a contribution of that nature is specifically disallowable under the taxes Act. I know that this is a subject not generally familiar to your Lordships, but I am sure that you will be aware of it. To be allowable, the item has to be an expense wholly and necessarily incurred.

I shall translate that provision into simple money terms. For a company to pay £48,000 to an opera or to an opera production, it actually costs them £100,000, because £52,000 must go in tax at the top rate of corporation tax of 52 per cent. If a small company, subject to the small companies' rate of corporation tax of 30 per cent., pays £70, only £30 goes in tax. From what my noble friend the Minister said—and I may have his figures slightly wrong, but I hope not—I have made a calculation that is very interesting.

In relation to the large corporation suffering tax at a rate of 52 per cent., it will get £1 for every £3 that it pays; so one-third of £48 is £16, making a total of £64, it suffering £52 tax. So the corporation will really receive, in effect, a rebate of a few pounds in tax. The small company will receive substantially more. I do not expect any of your Lordships to take in those figures when quickly put. The point I wish to snake is that if this relief were given through the tax system, it would have the certainty attaching to it on which the performing arts could say, "We can allow for this amount. We will receive that amount and we will receive a discount on it."

If the American system is too indigestible for the Government—where the whole amount paid is given relief from tax—then would Her Majesty's Government consider something along the lines of granting a smaller relief? Any relief would be better than none. That would be a great help. In this debate one has heard the arguments for total relief or no relief. I only suggest such a scheme, in my lack of knowledge of the subject, and invite my noble friend to take it on board in his considerations.

My Lords, I am grateful to my noble friend for giving way. I shall try to tackle this point, which is such an interesting one, while it is still in the minds of your Lordships. In respect of corporation tax I shall not comment, but will study what my noble friend has said.

In practice what tends to happen in Britain is that companies help the arts through sponsorship, and that help is deductible through those companies' advertising and marketing budgets. It is also possible for companies and individuals to make charitable donations (and most arts institutions are charities) through the covenanting system, which we have reduced from seven years to four years, in which case such contributions are also deductible. So the tax arrangements in this country are not so adverse as they are sometimes held to be; but I am very anxious to improve them further.

My Lords, before the noble Earl the Minister sits down, if he intends to write to his noble friend, will he place a copy of that letter in the Library? This is an important point, but to me it is very obscure.

My Lords, I thank my noble friend the Minister for his remarks. Before I leave the question of self help, there is one other matter I should like briefly to mention. My noble friend the Minister stated in effect that the United Kingdom is not as rich as France or Germany, but I believe that we may be richer than Italy. Your Lordships may be interested to know that Italy has set up 13 Enti Lirici e Sinfonici, which are public bodies which form the cornerstone of Italian musical life. For every lire spent by the public in purchasing an opera ticket they contribute seven lire; so there is room for my noble friend the Minister to improve on his offer by comparison with a country that is notably poorer than our own.

I have only two further small points to make. Glyndebourne has frequently been quoted to me, in the context of self help, as being absolutely lustrous and the total, final example of self help. Without in any way criticising Glyndebourne, whose performances I frequently enjoy, I should like to emphasise that it is an accepted fact that artists who appear there and who have built a career for themselves—including producers who are well known—do so for considerably less than half their real market value. They do a favour; Glyndebourne is unique. So there is a danger—and that is all I am saying—of alluding to Glyndebourne as the whole reason for self-funding; it is not.

I have also been told that there is considerable danger that regional theatres may have financial difficulty in putting on Shakespeare plays. Again, I couch that in the language I have used previously. I do not know the exact facts that support this. I cannot corroborate it. These are statements made to me by people whom I respect. If there is a danger of that it leads to this conclusion: that there will be great difficulty in finding actors of sufficient talent to perform at the Royal Shakespeare Theatre in the future. One must then ask the question—and I do not in any way want to be alarmist—is the edifice crumbling? If that is so, I would say that there might be one or two fissures in it and, although it may not be crumbling, it is serious.

Finally, other noble Lords have said this afternoon, and I associate myself with the remarks, that this is a huge investment that attracts people here. If the figures I have quoted are accurate there is a possibility that we are not being funded enough. It follows from that that the cultural capital for opera and the theatre may be shifting from this country to Germany or France. I should hate to feel that that is going to be the reality. I seek from my noble friend the Minister an assurance that these matters are well and truly considered by Her Majesty's Government.

My Lords, for the noble Earl the Minister this afternoon's debate must have represented something of an argumentative sauna bath. He is plunged from the warmest air of compliments and thanks into the iciest waters of criticism. The only reason I do not wish to spoil that process is that I realise that sauna baths are reckoned to be wonderfully good for colds and it is plain that the Minister is suffering badly from one; and we are all sorry for it.

I start, then, with the warmth of my own congratulations on the £25 million for the latest three in our series of endangered historic houses. Since the latest three are among the greatest three, my thanks and congratulations are redoubled. It is obviously a first-class stroke which the entire nation will welcome. I was also very happy to hear the Minister refer to films. I wish he had been able to be present in your Lordships' House recently at Second Reading of the Films Bill because I think he might have been a little disturbed by that debate.

As I recall it—and I took part in the debate—with the sole exception of his noble friend who proposed the Bill and its Second Reading, and who wound up the debate, almost everyone else regarded the nature of this Bill as a sad decline in support for the film industry. I know that the noble Earl does not entirely share that view because he spoke very supportively of the film industry this afternoon, and in particular the British Film Institute. The point of that debate, however, was to say that to separate out the art of the film into, as it were, the British Film Institute and its production fund and the self-sufficient and those beyond the need of help in the commercial industry is a mistake. The two cannot be separated as simply and as swiftly as that. There is an area where the film industry, as such—and I mean the commercial industry—needs help and films are no more separable into two halves than is the theatre world; and we all know how complicated that is.

My Lords, I am most grateful to the noble Lord for giving way. Again, it is a question of dealing with the point while it is fresh in the mind of the House. The point I sought to make—and I rather agree with the noble Lord about the indivisibility of film culture—is that I am limited by the possibilities of my responsibilities. I am not responsible in the Government for the film industry. However, I am responsible for the British Film Institute and I do my best to help films through that.

My Lords, will the noble Lord allow me to make a comment on what has just been said? Other speakers at Second Reading of the Films Bill made exactly the same point to the Government spokesman at that time; that it was totally unsatisfactory for there to be a division of responsibility for the film industry between different Government departments. The Minister's noble friend rejected that argument.

My Lords, I am grateful to the noble Earl the Minister and to the noble Lord, Lord McIntosh, for those interventions. I think it would be much safer if I left the subject of films forthwith, otherwise we shall be here all night. However, I must say that it is very warming to see in the proposals of the noble Earl that, of the £34 million allocated to the arts for 1986–87, there is a special £1 million for the British Film Institute. I hope that nothing I said just now will be construed as anything except full admiration for the work done by the British Film Institute.

My third reason for congratulating the Minister is on the one-for-one funding that he proposes for first-time sponsors. I welcomed the £1 for £3 system which he so successfully introduced. I have a little insight into business sponsorship because for some years I have been a judge on the Business Sponsorship of the Year Awards, which are so generously sponsored by the Daily Telegraph. Being a judge for that annual institution gives one a tremendous insight into sponsorship, for the simple reason that one has to read an incredible amount of very detailed submission on how good sponsors are. One sees almost the complete scenario for the year. Indeed, I may be able to reassure the noble Lord, Lord Jenkins—on whose initiation of this debate I congratulate him, as have other noble Lords—because, as I understood him, he said in his speech that he misdoubted whether sponsorship was really getting down, as it were, to the grass-roots. He made the point, which I think is unchallengeable, that it has been a lot easier for very big, charismatic and glamorous institutions to attract sponsorship. Indeed, it still is, and I suppose that is inevitable.

My experience shows, however, that it is starting in the very areas that he feels are underdeveloped. It is starting with the little companies, the little sponsors and little businesses. If that is the case, the Minister's stroke of at once tripling his contribution to make it a one-for-one matching grant—and if I understand him right, that is the intention for a first-time sponsor—would be nothing but beneficial. I can see that as being a very useful adjunct to the arts.

My Lords, since the Minister has started the undesirable practice of intervening in other noble Lords' speeches, perhaps I can follow him with the same undesirable practice on this point. I am in favour of sponsorship and, as chairman of the Battersea Arts Centre, I am also in favour of small-scale sponsorship because we have done quite well out of business. The problem with business sponsorship is that it is unreliable. American experience shows that in the long run one has to be very careful that it does not have a bad or deleterious effect on public sponsorship.

My Lords, I am grateful to the noble Lord. Lord Jenkins. He has cued me, as it were, to a point I was about to make. Having said how much I welcomed this one-for-one funding I was about to add that the danger of sponsorship is, as the noble Lord. Lord Jenkins, said, partly the difficulty of discovering whether it is actually on top of, or in addition to, public funding and not instead of. I sense that there is a nervousness within the nation that the noble Earl the Minister is looking to the private sector not merely to add to the funds but to replace them.

The Minister has been very clear this afternoon and I must not misinterpret him, because he has already taken one noble Lord to task for doing so. If I understand him correctly (I shall immediately sit down if he gives me the signal to do so), he intends to maintain the level of Government subsidy—that is, public subsidy—for the arts but to allow its growth factor to be taken over by the private sector. If I understand that aright, this means that any new client—any newcomer to the party, as it were—must look to the private sector. I do not believe that one can leave the arts at an absolutely steady level like that. Growth, it seems to me, is essential.

My Lords, the noble Lord has so nearly represented me a right that I rise only to take him to task for the one area where he has not. I said that central Government finance will be maintained in broadly level terms, and that for the growth and expansion, which I agree with pretty well every noble Lord who has spoken is desirable, we must look to other sources of funding. These sources are not exclusively in the private sector. They would also include, of course, local government.

My Lords, I stand corrected; that is absolutely right. The sources do include, of course, local government. There will not be, unless things go very differently in this House than is confidently expected in some quarters, as much local government available to cope with that point as there was. What is more, I wish that I shared the noble Earl's confidence in what remains of local government being able or willing to take up that end of it. But, of course, he is absolutely right to correct me and to say that it is not entirely the private sector to which new customers will have to look; it is both.

That brings me on, indeed, to something which I find very disquieting, and it may well be that the noble Earl himself finds it disquieting. Because I work for the GLC I hope that your Lordships will understand that I am naturally nervous about what will happen to the arts in 1986, in a year from now. Very many people, including myself, have congratulated the noble Earl on his foresight and wisdom in changing radically the Government's proposals for the arts after abolition—from the first mention of them in Streamlining the Cities, the Government White Paper, until the recent plans. He has set aside a sum of £34 million. The last time we debated the matter in this Chamber he was very clear that, of the £34 million, £17 million was for museums and galleries, and that end of life, £1 million was for the British Film Institute, and £16 million was to replace the arts grants funding of the GLC and the metropolitan authorities in 1986–87.

That figure had been calculated at 1986 prices but based upon the level of funding in 1983–84, all bar about £4 million. The noble Earl made it quite plain where he saw that £4 million as being a cut—those areas which he regarded as being something which local authorities (by which, in the case of London, he meant boroughs, and in the case of the metropolitan counties he meant districts) should properly take over.

I therefore supposed that in 1986–87, in London in particular, what the GLC was currently doing would continue broadly at that level. I am now becoming rather alarmed because there are indications from the Arts Council that it may not be able to pick up in 1986–87 the standard clients of the GLC at the level to which they have been accustomed—and this is not a vastly inflationary level, but one very mildly inflation-proofed each year. If that is the case, it seems to me that the Minister's intentions will not be carried out. I am alarmed about it, and I wonder whether he can reassure me, either at the end of the debate or now if he prefers, that he is not as alarmed as I am.

I have made some inquiries of the Arts Council as to its intentions for spending that money. It has pointed out to me quite publicly that it does not see itself taking on any new clients, which means that any clients shared between the GLC and the Arts Council—and there are plenty, including the big national companies—will obviously devolve to the Arts Council. Any body funded by the GLC in which the Arts Council does not already have an interest will be the responsibility of the Greater London Arts Association; and it will be the responsibility of that body to say to the Arts Council which of the GLC's clients, either jointly funded with it or solely funded by the GLC, it wishes to adopt. It will have then to make a bid to the Arts Council for the funds to cope.

That is a complicated process. Understandably, I have not had a full and complete answer yet. I should not blame either organisation for being unable to provide it. But I have an underlying worry that the level of funding currently enjoyed, not by the fringe activities of London but by the absolutely solid activities of London, will not be maintained in 1986–87 at their present level.

My Lords, would the noble Lord like me to deal with that point now or later.

My Lords, I should be pleased if the noble Earl dealt with it now.

My Lords, I am grateful to the noble Lord. He has interpreted me extremely fairly. I did not feel that I could hold the Government responsible for additional funding which was made once the policy had, as it were, cleared its first hurdle in another place. However, I did feel that the money must be indexed forward to the period of time when the policy would go into effect. That is the first point. The second point is about the borough and district contribution. I think that even my sternest critics would agree that to ask for £4 million off all the boroughs of London—32, or whatever number there are—and all the districts affected in the metropolitan areas is not exactly singing for the moon.

The final point is that I have myself been reassured by the Arts Council that it is finding a good response from local authorities generally, even though this is a time of pressure and squeeze on local authorities, as it is on central Government, with the policy of, as it were, challenged funding—of saying, "We will do our bit if you do yours". They were worried about it at first. They are finding the response a responsible one and encouraging.

My Lords, once again I am obliged to the noble Earl for intervening at this stage. I think that enough has been said for me to leave this point now, but perhaps in leaving it I should just say that, although I am bound to agree with him that £4 million spread across the entire country looking towards local government is not by any means searching or crying for the moon, I think that both he and I may be gravely disappointed when we see how much of it is taken up. We shall know, of course, within a year from now. But I wish that I could share his confidence.

The next point on which I should like just to touch—and once again, I suppose, I should declare an interest, even though it is a decade old—is the National Theatre. I used to be deputy director of it and still fund it, happily, through the GLC. Much has been said this evening about Sir Peter Hall and the great controversy about the closing of Cottesloe. I should like to say two things. First, it has been suggested that Sir Peter is crying too loudly, being melodramatic and making an unnecessary fuss. All that I can say to that is this. If one has spent a decade of one's life devoting oneself to something as great as the National Theatre, and it has three auditoria—three children—and you see the youngest and smallest of those children about to die of starvation, you shout. To suggest that anything other than that is appropriate seems to me simply to miss the issue at stake.

The second thing that I should like to say on that point is that the GLC is indeed trying to save the National Theatre. I think that the noble Earl was less than exact in his critisism of the GLC on this matter. I am not one of the politicians of whom he complains so loudly. I think that he used the word "contempt" in referring to the political battle that has been fought on this subject. But I think that there is a logic behind it which escapes him. He said that he wished that the GLC had not made it conditional upon rate capping not going through. This is not the case. The GLC has not done that. What it has done is to adopt a perfectly logical process; and since I am there to administer it, I know something of it.

It has recognised that the Cottesloe Theatre needs half a million pounds a year to run it. One should consider its running costs and subtract its income. It is doing about 90 per cent. business, so it seems to me that it can scarcely be asked very much to improve on that. One is talking about £½ million a year. The GLC has suggested that next year it will provide three-quarters of that, £375,000, I think simply because the theatre cannot be saved overnight. It is due to close at the end of April. I have talked with Sir Peter about it. One cannot do an U-turn in the middle of the road and just open it again. One has to have a programme, re-engage a cast and so forth. It seems likely that 1st July is the earliest he could manage. For that reason we chose the figure of £375,000.

At the same time it is quite obviously impossible to promise sums of that kind unless you have a base budget in which your ordinary clients will not suffer, including, if I may say so, the National Theatre itself. It would make very little sense to give £375,000 with one hand and remove its standard grant, which is slightly over twice that, with the other. Equally, the National Theatre has made it very clear to me that it would not welcome any kind of rescue operation which was over the bloodstained corpses of any other theatrical institutions or indeed any other arts institutions. That is entirly honourable of them. I do not suppose for a moment that the GLC would want to do that anyway.

Clearly, the nature of the arts budget of the GLC, that is to say its standard base budget, would ordinarily not be in question. Such a gesture to the National Theatre last year, the year before or within the last decade would not have been conditional: it would have been made, there would have been enough confidence and enough money to be sure. The only difference this year is the question of rate capping. There has been much debate about what rate capping will mean. This is not the place or the time, and I am not the person, to explain those propositions. However, there are many unknowns still in front of us. One is the question of exactly what rate-capping will mean to the entire GLC when, and if, it has produced its precept at the end of this week. What proportion of those cuts must be borne by the Department of Arts and Recreation, which I head, and therefore include the arts?

Until those facts are known, that grant cannot be promised. So I think what has been put down is an understandable caution and not a political manoeuvre. I, like everybody at the GLC, hope that before long it will become clear that the cuts which might fall upon the national bodies will not fall on the national bodies. There can be no promise of it at this moment, but everybody hopes that that will be the case. If it is the case, then the salvation, or at least the temporary salvation, of the Cottesloe will go through and I hope—as I think it will be—that that will be applauded by everybody, including the noble Earl himself.

The question of the Arts Council has been much debated. It was very interesting to me that the noble Lord, Lord Gibson, whose speech I thought was so sane and balanced and which I admired so much, outlined very clearly the role that the Arts Council ought to play as leader of the arts lobby, which one always hopes will never need to exist but plainly in this climate does need to. Yet I have sensed from many speakers in this debate some doubt as to whether the Arts Council is actually fulfilling the function which the noble Lord, Lord Gibson, outlined for it. The noble Lord, Lord Hutchinson, cast the gravest doubts on whether it was doing so. In fact, he thought that it was probably fighting on the other side. The noble Viscount who has just spoken came to no conclusion but worried about it. That worry is in the air.

On the question that has often been raised of the arm's length principle of the Arts Council, I should say that I have always believed in it. But it is possible that the arm is becoming shorter. It is not a question that it is visible, that the Government have eaten it, taken it over and that it is now simply a creature. I do not believe that. However, it is possible that the arm is becoming shorter all the time, and I suggest that in any democratic society it would be a worry if that were the case.

Lastly, something which the noble Lord, Lord Donaldson, said struck a chill echo in me. It struck that echo because the noble Lord, Lord Donaldson, and I have not adressed a word to each other on the subject, yet it reflected exactly my own fear. Is there the start of a gradual withdrawal from the public subsidy principle? I know what the noble Earl the Minister has said. But the feeeling is that the major push in the arts comes from public subsidy, with all that that has meant. Do I sense a walking backwards from this principle, a gradual withdrawal?

The noble Earl adjured us all not to be melodramatic on this subject; so I shall not describe it as a conspiracy, or as a Government policy. I say that it is a sense of unease that comes over me. It comes over me particularly because of this. We are supposed not to be melodramatic about what the Minister said in relation to a quantum leap. Indeed he spoke of his determination to continue Government funds for the arts at their present level. Nevertheless if we in the arts are under-funded—and I think that most people agree that in relation to the rest of the civilised world we are—then a quantum leap is actually what we need. I echo the noble Lord, Lord Gibson, when he said that that actually was what he meant: a quantum leap. "A quantum leap" is a very dramatic term in its own right. As far as I can see, it only means an increase. It just sounds worse than an increase. An increase is what we need and I cannot believe that Government financial policy will come to a halt if we acknowledge that the arts have for a long time been under-funded.

My Lords, I should like to join others of your Lordships in thanking the noble Lord, Lord Jenkins of Putney, for initiating this very interesting debate. I want to confine my remarks to the theatre, which is my particular interest, and for a few moments to take up the theme of the Cottesloe, about which we have just been hearing from the noble Lord, Lord Birkett.

I do not know how many of your Lordships have visited the recent series of mediaeval mystery plays that the Cottesloe are giving at the moment. It is a remarkable experience. You go into the darkened theatre, lit only by a myriad of flickering hanging lanterns. There you witness the events of the Passion and the Crucifixion, right among them. If you like, you may sit in the galleries, which encircle the hall, and look down on the crowd from above, in which case, although they are dressed in jerseys and jeans, they look remarkably like any crowd has done all through history. Alternatively, you can go down on to the floor and mingle with the crowd and watch reaction as well as action in their very midst.

It will be a lamentable loss if the Cottesloe goes dark for good. We hope that this will not be so. Even as things are at the moment, a number of actors are bound to have their contracts terminated. I understand that some 100 of the house staff will be made redundant, so that instead of the National Theatre paying them to assist in this marvellous creative work, the Government will be paying them to do nothing.

So what has been achieved? The charge has been made that the National Theatre has been prodigal and that it should be able to survive on the grant of something under £7 million from the Arts Council. But it is a colossal building with huge maintenance costs and, as the noble Lord, Lord Birkett, has just told us, the Cottesloe itself costs something like £½ million a year to run. But the National Theatre has done and is doing a magnificant job in self help. As we have already heard this afternoon, it fills the seats in three auditoriums to 80 per cent. capacity throughout 52 weeks in the year. It has also a very thriving catering business. I think it was the noble Lord, Lord Hutchinson, who told us that they made £¼ million in a year. As it was expressed to me this morning, the public have eaten their way through the expenses of two entire productions or, to put it another way, the profits from the catering business have paid for two productions.

In the sale of seats they earn 42 per cent. of their expenses, which is apparently a high figure. On the continent they do not expect to earn more than 25 per cent. of their expenses. They are now planning to cut down to three companies instead of five, which of course greatly restricts the repertoire. When this kind of thing happens what we lose is richness and variety, such as the production my wife and I saw last week of the mysteries of the Passion. The directors are outstandingly loyal and could all, I believe, be earning a great deal more than they are in doing what they are doing. Their feeling towards the Government is, "We are here to run a great national institution, established by Act of Parliament. Do you want us? If not, please say so".

I should like to draw your Lordships' attention to the report of the parliamentary Select Committee which has already been mentioned, again, I think, by the noble Lord, Lord Hutchinson of Lullington. The opening words of the Committee's report published in October 1982, were:

"Your Committee take a positive view of the Arts and deplore the fact that they are still in many respects regarded as a marginal activity".

The Committee added in its recommendations:

"Since private funding will never account for a majority of the necessary arts budget, the level of public funding should be substantially increased over the next five years and thereafter, in order to give arts organisations the full confidence to make long-term plans free from damaging economic constraints, and in line with the artistic needs of their public".

Instead, there is to be a progressive levelling out process over the next few years. I should like to add that I consider that perhaps the greatest subsidisers of the theatre, as of other artistic professions, are the artists who not only create but who do so often for a pitiful remuneration. The Equity lower minimum wage is £98 a week. It should be borne in mind that we are not speaking of casual unskilled labour but of highly trained and experienced artists.

What positive suggestions can be made? The Select Committee report made several. It urged that there should be a Ministry for the Arts, Heritage and Tourism which would bring under one department all branches of artistic enterprise at present divided between the Department of Education, the Home Office, the Department of the Environment and the Department of Trade and Industry. This would give the interest of the arts the necessary priority in Whitehall.

The Select Committee also recommended that a small percentage of their advertising revenue should be contributed by the independent television companies to the live arts on which they depend for so much of the talent, training, professionalism and creativity which they use. One problem is that theatres cannot charge enough. They cannot charge a realistic, economic price for tickets. One way of getting round this might be a voucher scheme. The public would be offered, say, seven or eight tickets for the price of five, and the theatre would reclaim the difference between this and the full price from a Government source such as the one I have suggested. By this method, the theatre would be able to charge a realistic price which casual visitors coming to a single performance would be required to pay.

Then there is the vexed question of VAT. The Sixth European Council Directive of 1977 views the arts as,

"an activity in the public interest"

comparable to welfare services, education and voluntary services and gives member states the responsibility of passing legislation to harmonise VAT within the Community. How much have we done about this? The United Kingdom, Denmark and the Netherlands are the only member states levying VAT at the standard rate for the arts. In Germany the theatre is zero-rated for VAT. The committee recommended that:

"all cultural services which are in the public interest, theatres, concerts and other cultural events, should be exempted from VAT by 1985".

After all, my Lords, we are not talking about a lame duck industry. This has been stated several times in the debate. It is one that is bringing enormous wealth to the country. A British Tourist Authority survey for 1977–78 showed that two-thirds of overseas visitors thought that the availability of one or more of the arts facilities in Britain was either quite, or very, important in their decision to visit Britain. A survey conducted on the Edinburgh Festival showed that £1 million provided in subsidy generated £16 million in tourist revenue. So, in subsidy, we are not talking about charity or prodigality but about investment—what the country most needs—not only for the tourist industry but for our own people, especially when, in the years to come, we may be providing increasingly for leisure.

Above all, I should like to celebrate the virtues and importance of the live theatre. I say this not only because a performance such as we saw last week at the Cottesloe raises the spirits but also because it gives a sense of community to the audience which is not so very different from the old-age pensioners and the children at the pantomime in Hastings—where sometimes I used to go to the pantomime-that-was—all shouting out, when the giant or the witch creeps up on the clueless dame from behind, "He's be'ind ya!" or the interplay between audience and actors of, "Yes, I did! Oh no, you didn't! Oh yes, I did!" That sort of thing can only be enjoyed in the theatre. And, alas, Hastings has been dark for the last two Christmases.

It was not such a different experience that we had at the Cottesloe, mingling with a crowd of eager young people from diverse countries and backgrounds participating in a re-creation of mediaeval England. Let us hope that it will somehow be saved and that the final song of the Passion performance will prove prophetic:

"We'll sing Alleluia!

At the turning of the year;

And we'll work all day,

In the old-fashioned way,

Till the shining star appear!"

My Lords, it is always hard to intervene at such a late stage in a debate. I shall confine my remarks mainly to the arts rather than to the second part of the Motion of the noble Lord, Lord Jenkins, concerned with finance for broadcasting, other than perhaps to endorse the point raised, I believe, by the noble Lord, Lord Hutchinson, who rightly said that there is not much point in finding finance for broadcasting if you do not have something to broadcast. Of course, if you are to have something to broadcast, you have to depend very much on having a healthy arts scene and particularly a healthy scene with regard to the performing arts.

In joining with other noble Lords in congratulating the noble Lord, Lord Jenkins, on raising these issues, one might suggest that his timing is nothing if not professional. We have, after all, a crisis in the arts. We have been told so by the noble Lord, Lord Hutchinson. We are told so frequently in the media. It is a crisis, so the story goes, because the Government will not find enough public money for the proper support of the arts. The crisis is exacerbated now because the Arts Council of Great Britain chooses to spend these inadequate sums accorded it by the Government in a way with which a number of people disagree.

I have been involved with the arts and arts administration for 20 years. I am bound to ask of this latest crisis, "What's new?" I cannot remember a time during those 20 years when the principal factors contained within the current crisis have not applied. No Government have ever given enough money to the arts in this country. And disagreeing with the policy of the Arts Council, if I may say so, has always been an honourable pastime for those who have not been party to the formulation of that policy. So the crisis has been maintained as a kind of cultural "Coronation Street" right through the last 20 years which, in reality, have seen a rate of progress in public subsidy for the arts from several thousands of pounds to hundreds of thousands of pounds substantially outstripping the rate of inflation but still, of course, woefully inadequate to do the job in hand.

However, if the main characters in the continuing drama are unchanged and if we continue, if you like, to thank God that we can hiss and boo those much-loved villains, the Minister for the Arts and members of the Arts Council chorus every time they appear on the stage, there must surely be some new and sinister twists to the plot to enliven the drama. There are a few. They have been brought out by some noble Lords, even if they have not been stressed by the noble Earl the Minister. For the first time we have a Government who are seriously trying and—and this is important—failing to cut public expenditure. They are dedicated to rolling back the frontiers of the state and to cutting taxation. Fingers in the gravy, as it were, have fallen into the thumb-screw. For the first time, it follows, the howls of anguish emanate not just from those who want more gravy but increasingly from those who are shortly to be in a state of thumblessness. That is a cautionary tale, lest we forget that members of Tory Cabinets are invariably brought up at nanny's knee on Hilaire Belloc and Matilda. I should be a lot happier that the Government's policy for the arts was going to succeed if there were clearer indications that their policies for cutting public expenditure were going to succeed.

Another new factor, I suggest, is the growing determination, not only of this Government but of the public at large, to have no truck with those special interest minority action groups which are seen to overstate their case, however deserving that case may be. In the 'sixties and through the 'seventies those with the best organisation and the loudest voices made most progress; there is no doubt about it. In the 'eighties we have seen a series of heavy defeats for such tactics, not just political defeats but defeats by public opinion. The wind has been taken out of the sails of the miners and the farmers, and, if they carry on as they have been doing over the past two or three years, I forecast with some confidence the impending deflation of the conservationists. With due respect to Sir Peter Hall for all that he has achieved at the National Theatre, I do not think that the public, in their current mood, enjoyed the view of him wearing out his shoe leather on their table with his passionate speech to the nation.

The facts have got to be faced. The times have changed, and although the problem remains much the same I doubt if it will profit the arts if artists and arts administrators now carry on as they did in the 'sixties and 'seventies. I say that with the greatest respect for all that the noble Lord, Lord Jenkins, achieved when he was Minister, and, indeed, for the way in which he introduced the debate with his opening speech.

The Arts Council's somewhat controversial policy paper entitled, The Glory of the Garden, is I think an attempt to face up to the reality of these times. It recognises the prospect of limited progress in real terms from central Government funds. It recognises the consequent sterility of the cul-de-sac ahead, where, on past policies, it would have been led to an untenable position, satisfying nobody and saving nothing as it failed to provide the wherewithal to keep afloat established client after established client, let alone to maintain a cutting edge to its arts policy through innovation.

That is right, my Lords.

My Lords, The Glory of the Garden is essentially an honest attempt to create some room to manoeuvre within the straitjacket. It is all very well for the Minister to mutter, "That's right, that's right", from his seat. I am going to change my tack slightly.

The Glory of the Garden has to rely on the kind of sleight of hand beloved by the Chancellor of the Exchequer in his attempts to create the illusion that he is cutting taxation. You take the tax off beer and you put a tax on petrol. As the noble Lord, Lord Jenkins, so rightly said, The Glory of the Garden takes money away from one client and gives it to another. I believe that part of the current crisis confronting the arts lies in the growing danger that in fact the Arts Council has already deserted its policy contained in that document, or partially deserted it. It would have been all very well had it stuck to the cuts it was going to make to provide the money to carry out the wonderful new policy. But it has not done that. It has reinstated a lot of the clients it had axed in The Glory of the Garden.

To a certain extent, I have an interest to declare in that I am vice-president of the Yorkshire Arts Association. It was by no means clear from the original The Glory of the Garden document that we were going to get back in new money, from the new initiatives, the amount that it was planning to axe in the region. I think noble Lords will perceive that my interest does not cloud my judgment that the reinstatement of clients originally intended for the axe has seriously weakened the Arts Council's current position as set against its original intention. That is a self-imposed wound.

The second threat to the viability of The Glory of the Garden lies, I suspect, in the shared responsibility of the Arts Council and the Government for a failure to appreciate that major changes of direction designed to achieve better management and to hold or even to cut costs are very difficult indeed to achieve without incurring, initially, some increased costs. Any of your Lordships who have been involved with the technological revolution and the installation and implementation of computer-based management systems will know what I am talking about. You have to invest in the way forward, whatever your political credo or economic philosophy. There is no real indication in The Glory of the Garden or from next year's grant from central Government to the Arts Council that either party has adequately grasped this crucial factor.

The third and perhaps the most damaging potential threat can be laid entirely at the door of this Government, on account of their policy on local government. The noble Lord, Lord Birkett, has stressed that point rather well. There is not much I can add to what he said, but I should like to say that I agree with him that this factor has been under-estimated by the Government. I think—this is a purely personal view—that the Government's policy on local government is ill-conceived, inadequately thought out, and will have disastrous consequences, particularly in those areas where deprivation and need are greatest. It is a matter of little doubt in my mind that all the points on local government reorganisation will be taken up in detail in Parliament again and again during the forthcoming Session, not least in your Lordships' House.

Today, however, we are concerned with the detail of the arts and the effect which central Government's policy towards local government will have on the arts. It is all very well for the noble Earl, Lord Gowrie, to make light of this miserable situation. Of course he does not want, in his words, to make a meal of rate capping. For 20 years Governments of every persuasion have been applying a constant pressure on local authorities to spend more on the arts. The regional arts associations were conceived as a partnership between local authorities and the Arts Council to encourage greater involvement. The Glory of the Garden lays great emphasis on continuing to direct policy towards areas where local authorities show new and financial initiatives.

The noble Earl the Minister has done so again in his opening speech today. Does the Ministry for the Arts believe it? Apparently it does. Do the good yeomen of the Arts Council really believe that the hoped-for upsurge in local government expenditure on the arts, after all these years, is going to spurt forward and materialise under rate capping and the abolition of the metropolitan counties? If so, I venture to suggest that they do not live in the real garden at all but in a garden inhabited by Mad Hatters and Cheshire Cats, and where the croquet hoops are flamingos. It is far easier for the Minister at the centre to keep his end up and to say, "Well, I'm managing to hold my part of the bargain. If you're very lucky perhaps we'll be able to find you a little bit more". It is quite another thing for a local politician who has just had his kneecaps removed with a shotgun by a bunch of pals of the noble Earl to explain to his local ratepayer, who lives probably in the same road as he does, that he is going to give some more money to the arts while having to cut a lot of essential services, maybe in the same district. To be perfectly frank, I think that the noble Earl's approach to this problem shows a massive lack of knowledge of what local politics on the ground are really like.

The Minister for the Arts says also that there will be no crisis on the abolition of metropolitan counties. Like the noble Lord, Lord Birkett, although I do not talk about the Greater London Council, I talk about the South Yorkshire metropolitan county and the West Yorkshire metropolitan county. The noble Earl tells us there is not going to be a problem. He did some figures back in 1983, which suggest that a few extra grants—he told us what they were—directed at certain clients will do the trick. I think the figure is right, but I may be wrong. I believe it is about £16 million which is to go to the Arts Council to cover the balance. He has already told us this afternoon that those figures, which were compiled in 1983, will take account of inflation. I hope that they take account of inflation in the arts and not some kind of figure for inflation worked out by the Treasury and based on the price of avocado pears in Sainsbury's!

It is a little difficult to follow the noble Earl's policy when it comes to dealing with growth in the support given by the metropolitan counties to the arts since he did the figures in 1983 and not all of that growth is, as he rather tended to think, political. There has been—and if the metropolitan counties were continuing their policies there would always be—some growth. The noble Earl knows full well, for example—to declare another interest—that the Yorkshire Sculpture Park has been waging a prolonged and hard campaign for several years to get larger contributions and greater involvement from the West Yorkshire Metropolitan District Council. He knows full well, because we told him the moment he told the world about his plans, that that policy was just starting to bear fruit when he did his figures and threatened to pull the rug from under our feet.

I am not sure whether the £16 million will go to the Arts Council or whether there will be some adjustment. If the noble Earl could give us some reassurance when he comes to wind up, I should be very happy. I shall not labour the point today. However, I doubt whether I am alone in making the calculation that what the Government have deduced will be the effect of their policy for abolition of the metropolitan counties is inadequate as regards what will actually happen. Here the minority special interest lobby for the arts really must press its case and the Government, if their arts policy is to have any credibility, should not seek to fob us off with anything less than adequate compensation for the effect on the arts of their policies elsewhere.

I began my speech by urging that we should recognise the realities and that we should present our case with a studied moderation. I do not feel that anything which I have said detracts from those initial arguments. The crisis which now confronts the arts is different and, to a certain extent, it has come about because of the political realities. But the battle which we must continue to fight is to ensure that the position is not further worsened by the potential for the Government and the Arts Council to make things blacker than they are already through inept execution of policies to meet the new situation.

The noble Lord, Lord Alport, mentioned the broken dinner knives from Rudyard Kipling's original version of The Glory of the Garden. I think that the broken dinner knives verse ought to be read in full. I have the feeling that perhaps—and I may be being a little unfair to the noble Earl the Minister—the first two lines of this verse were written by Mr. Kipling just after he had seen the noble Earl's opening speech this afternoon delivered in a dream. He wrote.

"Our England is a garden and such gardens are not made, By singing—Oh, how beautiful and sitting in the shade.

While better men than we go out and start their working lives. At grubbing weeds from gravel-paths with broken dinner knives".

Whatever way you look at it in relation to Government expenditure as a whole, public subsidy for the arts may fairly be described as "broken dinner knives". In spite of the confident opening speech of the noble Earl the Minister. I suggest that the possibility is there that Sir William Rees-Mogg will shortly not be grubbing weeds from his gravel-paths with broken dinner knives, but will be down to using his fingernails.

My Lords, in applauding my noble friend Lord Jenkins for initiating this debate, I hasten to apologise to him for not being able to be present (as I had warned him would be the case in advance) for his opening speech due to other commitments which could not be broken. I also apologise to the noble Earl for not hearing his opening speech.

I rise simply to raise one issue; that is, the question of the financing of the BBC External Services. Members of the House will recall that only yesterday afternoon I asked a Question on this topic and I hope that the noble Earl who is to reply to this debate will be able to give a more satisfactory Answer than his colleague was able to give yesterday afternoon.

Let us look very briefly at the facts. I asked what the Government's attitude was to the report of the Perry Committee which has been investigating BBC finances. Quite reasonably, I was told that they were still considering the recommendations. But then, in further questioning, the noble Lord made the statement that the finances of the BBC External Services had been increased over the past two years and were being increased this year. That I challenge—and I challenge it on, I believe, good authority—and I should like the noble Earl to answer the point during his winding-up speech.

The figures that were given yesterday towards the end of the exchanges as regards my Question, were shown to be cash figures and not to be real figures. Therefore, the increase took no account of inflation and nor, as the noble Lord, Lord Hill, pointed out earlier this afternoon, did they take any account of the decrease in the value of sterling.

Noble Lords know that the BBC has to buy many of its pieces of equipment in dollars. It is estimated, therefore, that the fall in the value of sterling has cost the BBC External Services £1 million this year. I ask the noble Earl whether he is aware that, at present, the BBC External Services are having to find cuts in their plans of £1·2 million, in addition to the consequences of the fall in the value of sterling? In other words, is it not the case that the resources available to the BBC External Services are being reduced this year and that that is bound to lead to unfairness to staff, to confusion in contracts, and to a deterioration in the value of that service?

I do not believe that there is anyone in the House who I need to convince of the value of the BBC External Services, and particuarly the World Service. Unfortunately, we are living in a time when many international organisations and institutions are under attack and are being undermined for lack of funds. This is perhaps the first period since the war in which we are seeing United Nations' institutions and a whole variety of international institutions becoming less efficient because of the starvation of funds. Surely the BBC External Services, and particularly the World Service, are accepted on all sides in this House as comprising a valuable international institution. For instance, how many of us when we want to know what is going on in the world, listen to the BBC World Service news rather than to the domestic services? I am sure that the vast majority of noble Lords with experience of living or travelling in all parts of the world have found that local people listen to the BBC, particularly to the news, in order to find out what is happening in the world. It is an international service. I would not argue in favour of the BBC External Services from a chauvinistic point of view; but from an international point of view they are one of Britain's greatest contributions to international understanding. One could go on and add the value of their agricultural programmes, of their scientific programmes, of their arts programmes, but I do not believe that I need to do that to this audience.

Surely the Government will agree that the External Services are of the utmost value not just to us but to the world, and that this is one of our greatest contributions to the world. Why then are they cutting down the resources which make them efficient, which make them possible, which give them the opportunity, in a period when other countries are expanding their foreign services? Why is it that year after year there is this cut in the funding of the BBC External Services?

The noble Earl's erstwhile colleague on the Front Bench, the noble Lord, Lord Carrington, made cuts in the financing of the external services in 1981. He very soon regretted it and he was honest enough to say publicly that he had made a mistake. I would ask the noble Earl, first, to address himself to the question as to whether or not it is a fact, and whether this House and this country should not know it is a fact, that this Government are cutting down the finances available to the BBC External Services? Secondly, would he agree with the noble Lord, Lord Carrington, in that this is yet another mistake, and use what influence he has to see that the mistake is remedied?

My Lords, I should like to join with other noble Lords in congratulating the noble Lord. Lord Jenkins of Putney, on introducing this debate today. Before inquiring how far arrangements for supporting the arts may be in need of review, some recent and general achievements (to which noble Lords have already referred) of his department and of my noble friend the Minister ought to be noted.

These include the maintenance of arts subsidies in real terms while other departments have suffered cuts, and the commitment by the Government to replace most of the GLC's and MCC's art budget in the event of its abolition; the introduction of business sponsorship schemes which have so far created £15 million; and the recent Government award to the National Heritage Memorial Fund of £25 million. In regard to the Arts Council, their policy changes announced last year are surely at least to be welcomed for the further distribution to the regions which they imply, and for the improved level of vigilance over grant-aid funds which the policies reflect.

To take Arts Council policies for a moment, while their aim will receive general approval the particular method proposed for reallocation is of course a separate question. Can it be said that the right choices have been made for increased subsidy and correspondingly the right choices made to effect the savings necessary of approximately £6 million?

Here, without going into detail, I should like to mention briefly two general points. First, the distinction between the performing arts and the creative arts. At present nearly all the council's grant in aid is spent on the former and hardly any on the latter. Nevertheless, there is a strong case to spend more money on the encouragement of new literature, contemporary visual art and musical composition. And as has recently been emphasised in the Kirkham Report produced by the Welsh Arts Council, it is necessary that more help should be given for the sales and marketing of new works and a proper system of references developed so that the market can become aware of, and be in touch with, these contemporary works.

Contrary to speculation I do not believe that John Milton would have had anything but approval for hard-working committees and their efforts. No doubt he would have spared them the trouble of contributing to the writing of Paradise Lost. But if a 17th century arts council—or indeed a committee of your Lordships' House—had been able to give him more money, posterity now might well have from him an even greater number of works of the excellence that it has. In view of these considerations, when he comes to wind up I wonder whether my noble friend the Minister could indicate whether he thinks there should be a higher proportion of Arts Council grants spent on the creative arts than is the case at present?

My second point on Arts Council proposals concerns touring companies. By definition the existence of these can present to the regions a greater level of choice and a greater quality of performance at less cost to the council's grant in aid than a network of local companies. This is not in any way to denigrate local companies themselves, which are important community assets. But could my noble friend the Minister say whether he thinks the Arts Council should now be urged to give more support to touring companies?

Several of your Lordships have referred to the arm's length principle, which is of course a very useful one since it enables the Arts Council to make its own decisions and its own reviews of decisions on how best to give support. But turning to other areas where government can intervene directly, there are the recommendations in the report of the Select Committee that tax incentive schemes relating to art should be introduced. Their effect would be to give proper backing from business and industry to any constructive policies now initiated, or reviewed, by the Arts Council and other relevant agencies. And their existence would create a better balance between support from public subsidy and support from private enterprise, which balance is necessary to any thriving sector in a mixed economy. In view of this can my noble friend the Minister indicate what plans his department now may have to introduce tax incentive schemes as recommended by the Select Committee, and in a form to resolve, or minimise, conflict with other sectors?

Further areas where government can intervene to support the arts are through measures to help prevent British works leaving the country, as the noble Lord, Lord Annan, has mentioned, and through measures to encourage foreign investment in British art. Regarding the protection of British works, can my noble friend the Minister reveal whether, in order to help prevent works leaving the country in the first place, he is prepared to urge the abolition of VAT on contemporary art sales, and whether he is prepared to raise the present level for exemption from capital transfer tax where the nation can receive British works in lieu of that tax?

In connection both with British works and with the encouragement of foreign investment in Britain, can he say whether he would be willing to introduce new export licence stipulations as a basis of negotiation with foreign collectors, so that once works did leave this country they would still be required to return on exhibition; and hence, also, so that foreign investment could be invited in art and in its centres and institutions in Britain? The Getty collection and other large foreign buyers demonstrate that they act responsibly, and are almost always willing to co-operate with the country whose works they acquire. Thus, if such an export condition did apply, it would only be consistent with the policy and attitude of large foreign collections, which is to co-operate on both a national and international level.

My Lords, turning briefly to the question of the future of broadcasting, there is of course the need to protect the standards and reputation of the BBC on the one hand, and on the other hand the need to protect the public from high levels of licence fee. But before resort to the consideration of expedients such as limited, or even unlimited, advertising by the BBC, what plans has my noble friend the Minister to remedy some of the abuses and anomalies within the present system? These include the non-collection of a significant proportion of total licence fees, which proportion is not paid at all; the anomaly where the house of a single pensioner pays the same as a house containing several wage earners; and the anomaly where, owing to an increase in the number and choice of channels, people who may hardly ever watch or listen to the BBC are effectively subsidising others who watch it frequently.

In summary, my Lords, while welcoming current achievements and efforts to support the arts, there is certainly a need to review arrangements for that support. As part of the arm's length principle, and among other areas for the potential review which noble Lords have already mentioned, the Arts Council should be urged to correct the imbalance between aid to performing arts and aid to creative art.

There is also the need to widen the choice for the regions by encouraging touring companies. As far as direct intervention is concerned, the Government should be urged to create more money from business and industry through tax incentives and to promote and encourage investment from overseas. These measures, if carried out, would give a great deal of confidence to future British endeavours. They would help sustain the present, well-deserved reputation in international esteem and markets of British art and broadcasting. And, in an age which still produces high levels of unemployment and urban deprivation, the country and all its communities would thereby be the better assured of the opportunities of leisure and the inspiration of art, past and present.

My Lords, this has been a debate of very high quality. There has been a number of speakers who have been fairly dazzling in their performance, among whom not least, I think, was the noble Earl the Minister. If I may, I should like to draw upon one or two of the points that he raised, before getting into the more general areas of arts as understood by the man in the street in this country—which are somewhat different from the arts as seen and understood by people who are involved with them, by politicians, and indeed by civil servants.

I was almost brought to the point where I agreed with 75 per cent. of what the noble Earl the Minister said; because, in the language of film critics, it was easy to be seduced by the fine balance of style and content. I do not want to be uncharitable, but now, having followed through the debate, I feel that probably the style was what seduced me and that the content needs some closer examination.

I should like first to say that I agree with the noble Earl, as I am sure will other noble Lords, that the Government have little to do with the creation of artistic genius. I may be misquoting that phrase, but I think I am fairly near the mark. I do not think that any of us would disagree with that, and I do not think that any of us would disagree with the glittering list of names of artists, writers and musicians—a fairly comprehensive list, though sadly lacking in film directors, I fear, but a list to which many of us could add. But that is not really relevant, is it? What we are really talking about now is something else on which the noble Earl touched. That is the world of the artist. Nobody would dispute that this country is very rich in creative talent; and it would be rich in creative talent even if we had no public subsidy at all. I hope that I do not disagree with my noble friends on this point.

The problem is that these artists would be frustrated in their aim, which is to have their works reach the public for which their works were created and without which exposure they would not be encouraged to continue. What we are talking about is the Government's role in encouraging the development of the organisations which serve the artists. This is an area which I think needs closer examination.

I am very grateful to the noble Lord, Lord Birkett, who made one of the most excellent speeches in our debate. I do not want to cause another series of interruptions, but during the noble Lord's remarks at the Second Reading of the Films Bill (in the deliberations on which I took part) he drew attention to the fact that during our deliberations on that Bill it became clear—and in this connection I know that the noble Earl the Minister is very sympathetic to the film industry, which is my own particular interest—to nearly all noble Lords who participated that there is a conscious and deliberate attempt by the Government to take an arm's length attitude to the film industry. I must say that it seemed almost a pier's length.

It seems to me that in our deliberations on the subject of films the Government were genuinely surprised by the depth of emotion and feeling in the views which were expressed by noble Lords. We hope that, as a result of the Bill that is going through this House, some changes may be made. But the central point I am making is that it seems that there is, certainly in the area of cinema in this country—which, after all, is a cultural activity—an attempt and a wish to withdraw; to follow, as it were, what seems to be the doctrinaire approach of the Government gradually, indeed rather more overtly in the area of the cinema, to allow market forces to take the place of the concept of Government aid, support, encouragement through measures of public subsidy and so forth.

This leads me to the whole attitude of Governments in this country to the arts. It seems to me that the understanding of the arts among the general public is very muddled. It may be that the expressiveness of our language (which the noble Lord, Lord Miles, referred to in such glowing terms, and nobody would disagree with him) perhaps falls down on this area of the arts. Maybe it has to do with the class. Class is a very touchy subject, but the noble Earl the Minister raised it. His remark was contested. I would not be as adversarial as my noble friend. Lord Hutchinson, who is experienced in being adversarial, but I seems to me that it was an extraordinary remark and very essential to the whole philosophy of the Government. I would not disagree with the noble Earl the Minister in this remark for I see what he is getting at. There seemed to be a misunderstanding between my noble friend and the Minister on the question of middle classes being attracted. If I am not misquoting the noble Earl, he asked in effect, why should we give extra money to an area of the arts which, as it were, supplies the needs of the middle classes? That is the way that I understood it. I understand that. It seems to me that, certainly in the eyes of the public, élitist areas of theatrical performance attract an audience which is largely middle class; and I do not think that this is any bad thing, provided that the encouragement of that area of theatre performance flourishes with the middle class and stretches to other areas of society as a result of that support. I may have got the noble Earl wrong on that.

My Lords, I am sorry to keep getting on up on this, but it does keep cropping up and the noble Viscount has tried to do me justice but he has got me wrong. The thesis is a very simple one. To cut the arts is indefensible; to increase the sums of money to the arts is defensible. To increase the sums of money available to the arts by some large percentage sum, which is what I mean, perhaps rather inaccurately, by a quantum leap, at a time when simultaneously you are trying to reduce public spending in all other areas, would or might be misinterpreted as an attempt by professional class people to keep bits of the welfare state which they happen to like to themselves. That is all that I am at.

My Lords, I should like to thank the noble Earl for that. I understand exactly what he is saying. I think it is an unfortunate misconception in the eyes of the man in the street and not, I must say, discouraged by the very unseemly confrontations between the Arts Council and Sir Peter Hall in the Sunday press; and I give all credit to the head of the Arts Council and also Sir Peter Hall as being men of enormous ability who are dedicated in their own ways to solving the problem which faces them.

But it seems to me that what we have in this country is an area of debate now which is intensely political. I am worried about the arm's length principle and I share the anxieties expressed by the noble Lord, Lord Birkett. I do not really understand it and I must confess that I have asked the noble Lord, Lord Birkett, outside this Chamber to explain to me the historical origins of the arm's length principle and why it should be so desirable that we have this almost sacred arm's length principle which, according to the noble Lord, is in danger of becoming what might be described as cannibalised.

It seems to me that there is a conscious attempt to make the whole area of funding of the arts nonpolitical, which means to say that you stand back until a crisis takes place and then you are forced to take a lot of rushed political decisions, which is what we have at the moment. The Government are now being forced to consider in political terms, through the Arts Council, which areas, particularly of our performing arts, should receive more or less of the limited amount of money available. After all, the money which the noble Earl the Minister has available comes from the taxpayer, and the taxpayer of this country is probably in as much muddle as many other people as to how much of his money should be made available to the arts and what kind of value it is to the citizens of this country. I do not think it has been well enough explained.

This leads me back to my main theme. Personally I feel—although I do not know whether other noble Lords would agree with me—that it is possibly time for the arm's length principle to be abandoned and for the Government to become more overtly politically involved in a more direct way. I know that the noble Earl the Minister has had many consultations of a very friendly nature with M. Jack Lang of France. As the noble Earl will know full well, being a francophile (as I am), the kind of central control which they have in France has historical origins and it is something which is somewhat alien to us. It is something which I can understand people feeling an antipathy towards. On the other hand, is it not now time that the Government took a longer-term view, not only over the arts but perhaps also over the restoration of our industrial performance and other things, and become more involved, in terms of guidance, assessing future priorities and explaining to the public at large the importance of the arts in our country? I say that because I think large sections of the community are, frankly, very muddled. They do not realise what effects the arts have on their day-to-day lives. After all, the arts do not represent merely the view which the company director has out of the window of the company Volvo. It is something which affects decisions right down to the most basic choices of food that you buy in the supermarket. It has to do with design and with the creation of public taste.

I do not know whether or not the noble Lord, Lord McAlpine, was being jocular, but I take quite seriously his remarks about major building projects. These have an arts content and in future years may well be viewed by our descendants as being important monuments to our artistic endeavours at the time. I think this needs to be explained to the public.

Then there is the confrontational pinnacle which we have now reached, where large groups of powerful areas of our culture are forced to shout; and, as Sir Peter Hall says, "If you don't shout, you don't get." I quite agree with him, and who can blame a man of such talent in charge of such an important part of our artistic life here shouting as loud as he does? But it does not get anywhere, because the public turn their backs on it and say: "This is a wrangle among élitist people, and how does it serve us?"

Many of your Lordships have brought out important points dealing with our resources, as opposed to our performing arts, our castles, houses, museums, provincial art galleries and things of that kind. I know that the noble Earl the Minister is very conscious of the need to maintain and provide not only for our resources as they now exist, but for their expansion, too. It is an important function of Government to realise the value of our resources, and I think this is something which is more easily explained to the general public.

Other noble Lords have made reference to unsuccessful experiments, maybe with piles of bricks in the Tate Gallery and with rather curious, challenging works of art, curious plays of an experimental nature and so on. But these are very necessary in our society because they challenge, they are provocative, and even though people may not understand them and they may cause people to be iconoclastic, they have a certain therapeutic effect in our society. All this needs to be explained and I am sure that if the Government can do so through the existing structures, through the medium of the Arts Council, people will realise, the country will come to realise, that in fact there is an increasing value and importance in our arts activities which go beyond just putting on plays in theatres, showing films in cinemas, and so on. I would welcome the comments of the noble Earl the Minister and perhaps he can clarify exactly what are the long-term objectives of the Government regarding the arts activities of the country.

My Lords, I hope the noble Viscount, Lord Falkland, will excuse me if I do not follow him down some of his interesting avenues. I would say that perhaps probably the best people to explain the bricks—and I do agree that they probably need some explaining to the general public—are the Tate Gallery. Indeed, the Tate Gallery have a series of interesting lectures, which the noble Viscount might care to attend some time, on different schools of art represented there, which are very well attended by the public.

It falls to me to have the privilege of winding up this debate from the Opposition Front Bench. I have listened, I think, to almost every speech, as has the noble Earl, and, if I may say so, I think it has been an excellent debate—and none the worse for having been hard-hitting at times. We are indebted to my noble friend Lord Jenkins for initiating it.

I am glad the noble Earl the Minister is to reply, especially as he has been having voice trouble. He has already made a robust speech in spite of this difficulty, which we greatly admire, on the Government's general policy towards the arts, although we do not admire the policy. I hope that in his second speech he will try to answer some of the detailed points which have been raised, other than those which he has answered on an ad hoc basis during the course of the debate.

My noble friend Lord Ardwick has dealt with broadcasting in some detail in his admirable speech and the noble Lord, Lord Hill, also made an excellent contribution, as one would expect. I should like to say just a few words in support of my noble friend Lord Hatch about the BBC External Services. I hope the Government will agree with the recommendation that the grant-in-aid should be put on the same basis and for the same period as the BBC licence fee: that is, for about three years.

We are also concerned, as my noble friend has said, that the Government have not allowed for the loss to the BBC External Services caused by the exchange rate. This loss amounts to about £1 million a year. Both the Foreign and Commonwealth Office and the British Council have had increases amounting to over £2 million. Why, one may ask, have the BBC External Services been left out?

Turning now to the arts, which I think has been the main subject of the debate, there has certainly been much criticism of the Government, and indeed, also, of the Arts Council in many quarters outside this House and in the debate today. However, most of the blame must surely be laid on the Government. The great mistake, I think, was for the Arts Council, with Government encouragement, to embark on a major development plan for the regions, as outlined in The Glory of the Garden, without sufficient finance, including local authority finance, as has been said by the noble Lord, Lord Feversham, and others, to carry it through.

Some of the effects are causing deep concern, as the noble Viscount, Lord Dilhorne, said. The English National Opera and the Cottesloe may have to close. The London Festival Ballet will be seriously affected. In the regions, those under threat include the Duke's Playhouse at Lancaster—Lancashire's only repertory—the Nottingham Playhouse and five regional symphony orchestras. Is it surprising that the Director-General of the Arts Council, Mr. Luke Rittner—and here I do not need to quote Sir Peter Hall; I am quoting Mr. Luke Rittner—said that he wonders

"whether a major tragedy isn't needed to bring the Government to its senses"?

Seven members of the Arts Council drama panel have resigned, as they believe that the council can no longer afford the policy outlined in The Glory of the Garden. This is not entirely the fault of the Arts Council, which had initially asked for a larger grant. It is certainly the fault of the Government.

In all this muddle, many of the arts organisations do not know where they stand. The five regional symphony orchestras—great orchestras, such as the Hallé, the Royal Liverpool Philharmonic, the Birmingham Symphony and the Northern Sinfonietta—have had to be told by the Arts Council to accept increases of as low as 2 per cent. in annual grants. How does this equate with the promised policy to increase support in the regions?

Then let us look at the case of Opera 80. This is a successful small opera company which tours the regions, gives a lot of pleasure in musically deprived areas and has never been over budget. Opera 80 take only 1 per cent. of the total opera budget, yet The Glory of the Garden recommended that Opera 80 should be axed. I can only think that there must have been some dense undergrowth in this part of the garden's glory and the writer lost his way. I am happy to say that due to a public outcry this ill-considered decision has been postponed and Opera 80 has been reprieved for a year.

Will the Minister confirm that this worthy regional touring company which is not in deficit will be allowed to continue? If Opera 80 is allowed to be axed, this will mean that more than 40 towns throughout England will be without any opera provision. During their current tour to 22 towns, Opera 80 have performed already to 16,000 people on the first eight weeks. The hasty proposal in The Glory of the Garden to destroy Opera 80 for capricious reasons—I can think of no other—seems to go right against the Government's policy, and indeed the Arts Council's policy, to bring more music to the regions. Let us hope that wiser counsels will prevail.

The four London orchestras have jointly lost nearly £300,000 from their grants. The Arts Council has threatened to reduce these orchestras from four to three, and the council has tried to post one orchestra to Nottingham as if they were an infantry battalion. The noble Earl and I were both present at the press conference given by one of these orchestras, the RPO, in which Sir Yehudi Menuhin said flatly that they were not going. I am glad to say that they have had a very large sponsorship from an American bank so they are quite independent. They do not need to go. They are not going to be posted about the country. There seems to be a lack of understanding of what an orchestra does and of its other work, apart from concerts, such as recording and so on.

But also—and this is important—Nottingham does not want another symphony orchestra, as the city prefers to have visits from various national orchestras, both British and foreign. The East of England orchestra is also based there and it would be better, in many people's view, to finance its increase to full symphony strength. Perhaps the noble Earl will tell us the result of the recent inquiry into the question of finance for the four London orchestras and the provision of another regional symphony orchestra, which I agree is required.

There seems to be further uncertainty over the future of the literature department. The Arts Council chairman and senior officers had decided to reduce substantially the department, although I understand that this plan was defeated at a meeting last week of the full council. The latest news, I understand, is that the plan is to be reconsidered. May I ask the Minister, whose love of literature is so well-known, to give the House the latest position? I should like to endorse all that the noble Baroness, Lady Airey of Abingdon, has said about the Imperial War Museum, which is not only an important museum devoted to the history of World War I, but is also a fine gallery of British art containing the best paintings anywhere by such artists as Paul Nash, Nevinson, Kennington and others.

I should like briefly to refer to two matters which are causing concern in the museum field. First, building repairs and general refurbishment should surely not be at the expense of grants, as the noble Lord, Lord Annan, has said. It is a one-off expenditure and should be treated as such. There should not be a question of choice between essential repairs, for example at the V & A, and the future of the Theatre Museum. We need both. I had an opportunity recently to see the building work at the proposed site for the Theatre Museum in Covent Garden and I am glad to say that it is proceeding very well. I am so glad to hear from the Minister that the ghost of Burritt has been laid at last, and that this exciting great project for a Theate Museum will not be subject to Treasury candle-end savings.

Speaking of the V & A, the noble Earl Lord Gowrie said,

"Where there's the will there's a way".

Yet at the V & A and other museums, I understand there is no incentive to raise revenue as this is liable to be deducted from the grant. It is a matter of regret that the museum and gallery grants have been reduced by nearly 13 per cent. and that the "acceptance in lieu" ceiling for the transfer of works of art to the nation is now as low as £1 million, as the noble Lords, Lord Gibson, and Lord Hutchinson, have said. This sum will go hardly anywhere.

"Acceptance in lieu" is technically the payment by executors of tax liabilities. It does not involve direct expenditure of public funds in the usual sense. This is basically a book-keeping exercise. May I ask the noble Earl to explain to the House how the Treasury can impose an arbitrary ceiling on capital transfers to the nation of unknown notional amounts, based on such unpredictable factors as the number of deaths in the year in question of those owning art treasures of national importance? How can this be predicted? What is to happen if the £1 million ceiling is too low?

Britain is at a serious disadvantage over "acceptance in lieu" compared with some other countries, particularly France. In France, there exists a similar arrangement under which works of art may be offered in lieu of outstanding tax, and the French museums, including the Centre Pompidou, have been enormously enriched as a result. I was greatly impressed a year or two ago when I saw the exhibition at the Grand Palais in Paris devoted to the Patrimoine and the richness of the works of art accepted by the state over the last few years—works of art ranging from early Books of Hours right through to the whole series of magnificent Picassos. I was reminded of those when I heard the sad story of Sir Roland Penrose's Chirico, a painting which I know well and greatly admire, which was recounted by the noble Lord, Lord Hutchinson.

The French museums have the advantage as there is no limit to works of art being offered to the Patrimoine under this system, and no requirement is made for any compensatory payments from the French arts budget. On this side of the Channel, the arbitrary ceiling, and such a small sum, when you are trying to save the nation's heritage, has been much criticised, and rightly so. Of course, the French always go for the object first and then find out how they are going to obtain it. We bumble about, think about fairness, precedents and all the rest of it, and of course get nowhere. Indeed, wherever you go, criticism of the Government's arts policy or lack of policy, has been almost universal, and as this debate and my noble friend's Motion make clear, there is an urgent need to review it.

My Lords, I agree with one thing the noble Lord, Lord Strabolgi said—this has been a vigorous and exciting debate; and I have learnt a lot from it, even though from my point of view there were perhaps slightly too few flowers ranged amid the vegetables.

One of the enjoyable features of politics is watching how relatively rapidly the terrors of office are forgotten by those who have relinguished it. The iniquitous system which the noble Lord, Lord Strabolgi, has castigated in terms of acceptance in lieu obtained when he was a Minister, and, I think, answered for some of these issues in your Lordship's house.

My Lords, surely there was no limit on that.

My Lords, I understand that there was; it was certainly budgeted for. It was just a rather higher budget. But I shall come to that because we try to make up the budget on an ad hoc basis rather than by forward accounting.

I wish to correct one of the things which the noble Lord, Lord Strabolgi, said. The difficulties of the English National Opera, about which I am very much exercised, are due to its overseas trip and are nothing to do with The Glory of the Garden exercise. I was also encouraged that the noble Lord, Lord Strabolgi, not following the view of his noble friend Lord Jenkins regarding the Arts Council's relationship with myself, mentioned criticisms which Luke Rittner had made of the Government. Certainly the trenchancy with which those criticisms were expressed hardly suggests that he is a puppet of the Government.

As I said in one of my ad hoc interventions—may I say to the noble Lord, Lord Jenkins, that they are in the debating traditions of the House so long as they are courteously done and so long as noble Lords accept them; I do not think there is anything sinister about them—the Arts Council's detailed grants for 1985–86 have not been announced and therefore I cannot anticipate their decisions.

I have had a slight technical difficulty during this debate in that I understand that there is a certain amount—not as much, no doubt, as I or other noble Lords should like—of good news coming up in regional terms. But, naturally, I do not yet know about it because I am at arm's length from the Arts council. So I do not yet know how they are going to make their precise dispositions.

I am advised that there is no reason whatsoever to suppose that the major regional symphony orchestras are at risk—the Hallé, the City of Birmingham Symphony Orchestra, and so forth. And, as the noble Lord, Lord Strabolgi, was fair enough to acknowledge, having beaten me over the head with it first, the Arts Council have in fact already announced a reprieve for Opera '80 for one year.

I promised, when I made my opening speech, that I would deal with the broadcasting element in the debate—

My Lords, I do not want to interrupt the noble earl, but he said that Opera '80 has been reprieved for a year. This is not very long. Will he confirm that it will be allowed to continue beyond that?

My Lords, the noble Lord, Lord Strabolgi, knows perfectly well that whatever my virtues or vices, I do not actually make the dispositions in this country to individual arts bodies. I would have to consult Sir William Rees-Mogg and Luke Rittner on that and I do not have time to do that now. I understand that a reprieve for a year will give opportunities to see what may be the future of the company. Certainly I wish the company well in all its efforts and the Arts Council well in their attempts to save it. But that is not for me, and if in due course the noble Lord, Lord Strabolgi, becomes Minister for the Arts, he will find that that is precisely the case with him as well.

I said in my opening remarks that I would try to deal with the broadcasting element of the debate. We had interesting speeches from the noble Lords, Lord Ardwick, Lord Annan, and Lord Hill, and we had a late intervention by the noble Lord, Lord Hatch. In respect of the questions on the BBC External Services, I find myself in some difficulties. Under the conventions of this House, which I fully accept and revel in, I answer for the Government collectively. Nevertheless, the financing of the overseas services is not part of the ordinary procedures of broadcasting finance. They are financed by the Foreign Office through the Foreign Office vote.

I value the External Services very highly. I listen to them late at night. Both my wife and my brother work for them and therefore I am thoroughly on their side. But I shall simply have to refer noble Lords to a letter which, if the conventions of the House dictate that I should sign, I shall of course sign. I shall find out from the Foreign Office the answers to the points raised by the noble Lords on this subject. I think it is fair for me to violate conventions just a little, as I have no one here from the Foreign Office and was not given any prior warning that I would need an official from the Foreign Office.

I come to our arrangements for financing broadcasting. As the House well knows, there is a distinction between the arrangements for the BBC and those for ITV. While the Government set the amount of the fees, the Board of Governors of the BBC decides how to use the income that the corporation receives. This system of financing the home service of the BBC has been endorsed by successive Governments for some 60 years and examined by successive committees of inquiry, the most recent being that chaired by the noble Lord, Lord Annan, in 1977.

Each inquiry has concluded that the licence fee system is the best available means of funding the BBC in a way which preserves its independence and enables it to fulfil its wide-ranging obligations for public service broadcasting. I can say with every confidence that the licence fee system and the BBC itself have served us very well.

On the independent side the television and radio services of the IBA are funded by advertising revenues. Independent television and independent local radio are funded directly. Channel 4 is funded by subscriptions levied on the companies by the IBA. In return for subscriptions, the ITV companies have the right to sell advertising time on the fourth channel in their own areas. These financial arrangements for the new channel—which Parliament approved in 1980—underpin what is now generally acknowledged to be the great success of Channel 4. Wearing my arts hat, I paid tribute to its contribution in my opening speech.

I should like to underscore that tribute with a tribute to the BBC, which has a long and proud record of broadcasting in the arts and, depending on how one defines the activity, an expenditure of £100 million to £150 million a year in the arts field. I am certainly one of those who did not grow up in a specially arts background but tended to obtain my own education in the arts by listening to the radio.

ITV has a similar record and outstanding successes have been mentioned this afternoon—such as "Brides-head Revisited" and "The Jewel in the Crown". I believe very profoundly that between them, the two major broadcasting interests provide a service to the public in this country and a service to the arts that is second to none. The Government are determined to see that continue.

As the House will know, the BBC has applied for an increase in the television licence fee—which should be called, perhaps, the television and radio licence fee. The present fees have already lasted for more than three years. My right honourable friend the Home Secretary is considering the application. When he comes to make a decision—towards the end of this month, I understand—he will want to ensure not only that the BBC is adequately financed but also that licence fee payers get a fair deal.

A number of anxieties were expressed in this debate—none more eloquently than by the noble Lord, Lord Hill of Luton, with all his experience—that when an increase is imminent there is liable to be public concern about the level of licence fees and about the suitability of the licence fee system; therefore, there may be some anxieties about whether that system will continue. The BBC has taken its own case to the people directly, and I commend its frankness in doing so. I am not violently opposed to advertising on the air, personally: equally, it has been generally accepted that one of the strengths of our broadcasting system is that the financial arrangements avoid competition between the broadcasting organisations for the same sources of finance.

The Government accept that the licence fee system has imperfections, and we have not closed our minds absolutely to the possibility of change. But we do consider that any change in the way in which the BBC is financed raises large and fundamental questions which would need most careful and lengthy consideration. We cannot lightly and hastily embark upon a change which would have profound consequences not just for the BBC but also (as a number of noble Lords have said) for the independent sector. For this reason my right honourable friend has made it clear that he does not propose to make any major departure from the licence fee system in response to the BBC's current application. I hope that will calm some troubled breasts.

I come now to the speech of the noble Lord, Lord Donaldson, who asked about recurrent expenditure in museums and galleries. One of the points he made was echoed by the noble Lord, Lord Strabolgi. The National Portrait Gallery has had a reduction in its net baseline for running costs, but taking into account the receipts it expects to earn in 1985–86 its gross provision will in fact be higher. The Government's review of the net Vote and the re-Vote system is still in progress. I aim to introduce improvements in 1986–87, which will give museums a greater incentive to maximise income for their own benefit. In this respect—if insufficient in others—the noble Lord, Lord Miles, will notice that I am on the side of the angels in their prelapserian state.

My noble friend Lady Airey, in a remarkably clear and sensible speech, mentioned the Imperial War Museum. I am delighted to hear from my noble friend of that museum's success in raising substantial private money for its redevelopment. In the spirit of the age—that is to say, that self-help should be rewarded, and of challenge matching funding and the like—the Government have pledged £6 million for the redevelopment of the museum if it can raise the balance of £2½ million by its own efforts. That sounds sensible to me, rather than a sinister atempt to dismantle a loved structure that has been with us since 1945.

The noble Lord, Lord Donaldson, and the noble Lord, Lord Annan, mentioned reductions in purchase grants. It was, frankly, a bitter grief to me to have to reduce purchase grants, as I am a kind of manqué, or mental, purchaser. No purchase grants were more fiercely reduced than those of the National Gallery, but as the noble Lord, Lord Annan, very fairly recognised, we have to make choices; often difficult choices. I believe that it was right to shift the balance away from new acquisitions—while still, of course, providing money for new acquisitions—towards the better conservation of existing collections and the buildings housing them. That is why I increased the museums' building and maintenance programme for 1985–86 by 15 per cent. This will provide £4 million extra compared with purchase grant savings of just over £1 million; so there will be real new money in the system.

I am delighted to join the noble Lord, Lord Beaumont of Whitley, in singing the praises of the Air and Space Gallery which I visited only last week. I have long known and admired the talents of Nancy Balfour as well as those of Mary Rose Beaumont. I am grateful for the complimentary references which the noble Lord and others made to the existing business sponsorship incentive scheme and the improvements I have made to it. Again, I recognise how generous was the noble Lord, Lord Birkett, in that respect.

The noble Lord, Lord Hutchinson, and I over the period of my time as Minister for the Arts, have gazed at one another across the Chamber, across tables, and across restaurants with a mixture of affection and despair. To some degree I am in politics to try to get away from the attitudes towards economics in this country which are the backbone and lifeblood of the noble Lord's thinking. For example, I feel much more at ease with the Left than I do, in political terms, with the noble Lord. We are in the business of arresting a deep-seated and long-standing decline in this country—a decline which I feel stems from the attitudes of the noble Lord and some of his friends. It seems to be all that is worse in Keynesianism, without its intellectual and moral rigour. I simply do not accept, as the noble Lord feels I should, this adversarial concept of government within government. I serve in this Government because I agree profoundly with their basic approach and I agree with our manifesto commitment in respect of the arts. I certainly would not have accepted the job on any other basis.

This commitment was that we should continue to maintain the subsidies given to the arts, but we would look at ways of supplementing them by other means, not least by fiscal changes. In a number of my perhaps rather virulent interventions I have tried to give chapter and verse to that policy. The noble Lord made a number of debating points which underscored his great reputation and success as a lawyer. I have become used to thinking of the noble Lord as a defending rather than a prosecuting attorney and so perhaps I was a little to sharp with him. He suggested that I in some way held the view that great nations are remembered for their politicians or for moments of economic policy rather than for their artists. That was in direct contravention to what I said in my opening speech, and which was why I went through my own small tour of the horizon of achievement in Britain. Of course I recognise that a substantial part of that achievement—and this perhaps answers the point put to me by the noble Viscount, Lord Falkland—not least in the performing arts, comes out of the system of central Government subsidy, to which we have all paid tribute. All I am seeking to do is maintain the health of that system by augmenting it from other sources, as it is difficult, for reasons we have long argued over, to give large increases in the base line that may, I agree, be needed.

The point in the speech of the noble Lord, Lord Hutchinson, which particularly stung me—and perhaps I should not have risen to his fly—was his suggestion that I lurk in the Treasury building wearing a balaclava. I think that my sternest critics could not say that I have not got around the state. I practically live in Merseyside. A number of noble Lords, not least my noble friend Lord Alport, were kind enough to mention that they had once or twice caught sight of me at one or two arts institutions since I have been Minister.

I say finally to the noble Lord, Lord Hutchinson, that it is precisely because we concede that the arts pay their way, that they are good investments, and that they are valuable for themselves as well as for any economic contributions that they make, that their subsidies have been maintained and, indeed, increased overall at a very difficult time as far as public spending is concerned. But it is, I think, a grotesque misunderstanding of the policies of successive Governments, including those supported by the noble Lord, to argue that all areas of public subsidy—industry, arts, education or whatever—in some way have to be additional to their net intake. If that were true, we should be in a far worse position than we are. We should be wholly in the control of the IMF.

I am very glad to agree with one thing that the noble Lord, Lord Hutchinson, said to me. I want to use this wind-up speech as a chance to try to kiss and make well with the National Theatre. My noble friend Lord McAlpine, with his admirable sense and brevity but with perhaps a bit of mea culpa on the construction side, praised the talents of Sir Peter Hall. One of my many difficulties as Arts Minister at the moment is that I really think of myself as a kind of Peter Hall "groupie". I even spent £600 of my own money, which is quite short at the moment, in going to see his Bayreuth, and I enjoyed it very much indeed.

What I am quarrelling with Sir Peter about, and what I have called (and I see that the tapes have picked it up) irresponsible rubbish, is his claim that anything less than an increase of £1 million in the base-line of his grant, which is what he fairly came to me to ask for, is in some way a concerted dismantling of agreed policy on the arts which has been built up lovingly over the years. In other words, "Give me a million or you are a vandal"! I do not think that that is sensible politics. I should not of course have mentioned this publicly if Sir Peter had not decided, as is his right, to enter the political arena. But, having done so, I do not think that he or anyone else will blame me if I have an occasional stab back. I hope that it will not affect what I consider to be my good personal relations with him; and it will in no way dent my enormous admiration of him as a director.

The noble Lord, Lord Mishcon, in his very non-political role as a member of the board of the National Theatre, was a bit anxious at my rhetorical query—a question which I thought could just possibly need asking—as to whether the National Theatre needed 50 designers. I never said that that was at any one time. The source for the number in my speech was the National Theatre's own report, which gave 42 designers and 24 assistant designers for the year 1983–84. I accept the noble Lord's assurances that the National Theatre never used more than 10, I think he said, at any one time, but I consider the general point a fair one. To be able to be in a position to engage more than 50 designers throughout the year indicates a fairly generous, but no doubt fully justified, approach to staffing. If I have in any way upset the noble Lord or the National Theatre on that, I withdraw it unreservedly. I simply feel that some of these issues, when money is tight, need sometimes to be aired.

My Lords, before the noble Earl continues may I thank him for his courtesy in what he has just said? I merely point out for the record that, of course, what I informed him was that at the present moment there are only four designers, three of them, I think, being freelance. They are employed for only a few weeks at a time. There has never been more than 10; and there are three theatres.

My Lords, I accept that altogether. May I say in further response that on my many trips to the National Theatre I have always been specially impressed by the quality of the design.

I come to the question of acceptance "in lieu", which has been raised by a number of noble Lords. I do not think I have ever heard the argument put better or more clearly than in the speech of the noble Lord, Lord Annan, which was why I thought it was such a pity that he dragged in Trident, or cruise, or something or other, rather to spoil it at the end. Acceptance "in lieu" has not been cut. The annual level remains at £2 million. The extra £2 million for Calke Abbey, which is now secured, was an exception. But my advice is that this sum is an Exchequer cost because it represents tax forgone by the Revenue and has to be paid back by heritage departments. I shall check again on this, but, as I understand it, that was the situation previously.

Having, as it were, read out the—I will not say party line because I do not think it is a party political line, but having read out the law on the tablets, I have to say that there are elements in the system which cause me some disquiet. I was very impressed by the speech of the noble Lord and I shall look closely at what he said. The problems of listing which he mentioned, those wonderful ladies Delictissima and Desiderata—I cannot remember—are formidable. There is no evidence that the Waverley rules are not operating reasonably well. The problem is one of very high international market prices. I think listing would be extremely complicated, bureaucratic and difficult to police, as well as a further qualification and intrusion on property rights. Of course it is not ruled out but it seems to me that existing powers are sufficient to stop export of any individual item, anyway, should Ministers so decide. On the whole, if we look at the record of what we have retained and what has been bought, even against the background of very high international prices, I think noble Lords can feel reasonably reassured.

Following the speech of my noble friend Lord Alport, I have to say that I doubt whether Colchester is wholly exhausted as a source of funding for the Minories, which I should have thought was an institution they valued very highly. In a number of towns comparable to Colchester—I am not making a comment on the direct point—I think the policy of the Arts Council of Great Britain is to encourage local authority funding by offering to match it. Towards the end of his speech my noble friend sensibly met my point about plural funding. As I say, I am anxious to supplement Government subsidy by all legitimate sources available.

This leads me to two remarkable speeches, those made by the noble Lord, Lord Birkett, and the noble Lord, Lord Feversham. In a way, the criticisms that they made of me are the closest to my heart because it seems to me that they, and perhaps also the noble Lord, Lord Annan, were the speakers in this debate who most understand the Government's policy, who have analysed it most closely and who recognise that the real issue behind The Glory of the Garden is a very legitimate and wholly undirected attempt by the Arts Council to deal with a situation where subsidy is not cut but where it is plateaued; therefore if you wish to bring on something new, something else may have to go.

While I do not accept the strictures in a number of areas put to me by both noble Lords, and while the Arts Council, with their distance from me, advise me that both noble Lords are rather too pessimistic where contributions by local authorities up and down the land are concerned, I nevertheless will take their speeches and their advice specially to heart due to the clarity of their analysis.

The noble Lord, Lord Ritchie of Dundee, followed the Select Committee of another place, interestingly, in respect of charges. I shall certainly look at that.

My noble friend Lord Dundee asked me a variety of questions. I think the one to which orally I can most easily respond is this. One of the great problems of tax incentives is how you ring-fence the arts and, if you do not ring-fence the arts, how you, as it were, put a ring in the nose of the Treasury, in the Revenue. But I shall try to take on board the other points that my noble friend put to me and I shall write to him, particularly on the broadcasting issue, after consulting my right honourable friend the Home Secretary.

I am sorry that, after everything I said at the beginning of my speech, a number of noble Lords, notably the noble Lords, Lord Gibson, Lord Donaldson and Lord Hutchinson, should still think that it is my aim either to arrange or to go along with the dismantling of our post-war system of public subsidies for the arts. As I really laboured to make clear, we have maintained the overall provision over the lifetime of this Government. Indeed, we have gone further. We have increased that provision since 1979 in real terms by 18 per cent. That is not a signal given by demolition experts. What I cannot accept is that, as the noble Lord, Lord Gibson, appeared to argue, anything less than a substantial quantum increase—or let us just call it an increase, a substantial increase—constitutes a squeeze.

As my noble friend Lord Cottesloe so fairly acknowledged, some things have to be pruned, which is always painful, so that others can be brought forward. That is the policy of the Arts Council. Sir William Rees-Mogg has argued most trenchantly that to devolve, as he would wish, to the regions, he needs about £15 million more than I have been able to give him. I do not say tonight—I have made this point publicly in the newspapers—that he is wrong.

I have been accused of wearing two hats but not fighting for the arts. I can only say two things in my defence. One is that I did succeed, as the noble Lord, Lord Birkett, fairly acknowledged, in reversing my colleagues' intentions to devolve responsibility for most arts funding to the boroughs and districts following abolition of the GLC and metropolitan counties. Secondly, I have said in public that I agree with Sir William's analysis that he needs an extra £15 million put into the system. My efforts, given that public spending is to be constrained, have to be devoted, rather like those of my noble friend Lady Airey and her colleagues at the Imperial War Museum, to seeing that somehow or other that money comes into the system. I will do so. I hope that this also answers a pledge asked of me by my noble friend Lord Dundee.

I hope that noble Lords and people outside this Chamber who are, I recognise, genuinely anxious, will do me at least the courtesy of reading carefully my opening speech. I believe that it will give some comfort and reassurance. I believe that the Government's actual record—it is broadly in line with the record of their predecessors, whether Labour or Conservative—does not give grounds for such severe anxieties as have been expressed.

My Lords, the noble Earl the Minister in his typically comprehensive and capable response to this debate, on one or two points, tempted me to break our custom that the mover of such a debate as this does not himself attempt anything in the nature of a detailed reply to it. Noble Lords will perhaps forgive me if I refer to a couple of points before asking the permission of your Lordships to withdraw the Motion.

One point, raised by the noble Earl himself, relates to the question of intervention. I felt, on one occasion, that the noble Earl was overdoing it a bit. However, I readily concede that the object of these interventions was for the purpose of replying. I prefer that the noble Earl should perhaps overdo the kind of intervention he made, as I thought he did, rather than that he should fail to reply. In so far as he did attempt to reply in the middle of having a cold, even though I did not feel that the replies were always very satisfactory, I should like to congratulate him and to withdraw any aspersions that he may have felt fell upon him on the question of his interventions which I thought, on one speech, amounted to possibly a little too much but no more than that.

I do not know whether my noble friend is right about Mr. Rittner—whether he is really on the side of those who are pressing the Government or whether, as other noble Lords have suggested, Mr. Rittner may be seen, as has actually been suggested, to be, as it were, carrying out Government policy. We shall be able to put the matter to the test very soon. I have asked Mr. Rittner to join me in a joint delegation to the Minister. If he decides to come with me we shall know that he is on the side of those who want to press the Minister as hard as we can to do rather more for the arts than he appears to us to be doing. I know that within the limitations he places upon himself he is doing as much as he thinks it reasonable and possible to do, but he will have gathered from this debate that there are a number of noble Lords on this side of the House —indeed, on all sides of the House—who rather feel that he is somewhat inhibited in his attitude by his intellectual convictions, his intellectual economic convictions, which we recognise are extremely powerful. I want—

My Lords, will the noble Lord give way for a moment? I have been puzzled by this whole question about the Arts Council and its standing and status. Surely Mr. Rittner and Sir William Rees-Mogg are in exactly the same position as Sir Peter Swinnerton-Dyer, who is chairman of the University Grants Committee. He fights for the universities, but he then has to tell the universities very disagreeable things about the amount of money there is to go round. Surely that is the analogy.

My Lords, if the noble Lord, Lord Annan, has not understood, at the end of this debate, that in the minds of many Members of this House there has been a change in the position of the Arts Council, then he has not been listening very closely to the debate.

I want to thank very warmly all noble Lords who have taken part in what I think has been a remarkable debate. There has been no speech made on the Floor of this House during the course of it in which I have not found something to agree with. I do not exclude from that tribute the noble Earl the Minister.

I should like to regard the debate as a paving Motion, as it were. In this Motion we have called the attention of the Government—the Minister—to:

"the need" to review the arrangements for the support of the arts, and to consider the future financing of broadcasting".

We hope that theGovernment are going to do that. We shall discover in the course of a short time whether they are doing so. If we feel—and I sometimes fear that we may feel—that they are not doing as we think they should do, then noble Lords on all sides of the House will want to return to this question, and when we return to it we shall do so with a Motion of a specific character which on that occasion we may well wish to pursue to a Division. But, for tonight, with your Lordships' permission, I beg leave to withdraw the Motion.

rose to ask Her Majesty's Government what action they propose to take to implement the recommendations of the Report on Immigration Control Procedures of the Commission for Racial Equality.

My Lords, the noble Earl, Lord Listowel, is absolutely right to point out that the more the emphasis is placed on eligibility the greater likelihood there is of denying the rights of those who ought to be admitted to this country. In the last 15 years or so I have dealt with many thousands of immigration cases and very often, after voluminous correspondence with Ministers and sometimes, at the end of the day, meetings with the Ministers in their own offices, the original decision to deny somebody entry has been reversed. When that happens, I always think about the far larger number of persons whose cases will not come before the Minister but whose cases might have been just as meritorious as those which were fortunate enough to be taken up by some MP or noble Lord.

I think it was predictable that any impartial investigation of immigration control procedures such as we have before us would find that too great an emphasis is placed on the detection of bogus applicants at an unacceptable cost to genuine families and to race relations generally. It is also inevitable, I am afraid, that the Government having (as the noble Earl, Lord Listowel, pointed out) fought tooth and nail to prevent the inquiry in the first place to the extent of causing the Commission for Racial Equality to go to court and waste 18 months of time, they would then, after the report was written, seek to delay the publication of it—as they did—and then to rubbish the findings when they were finally published.

As far as I am concerned, it is as plain as a pikestaff that the immigration rules are racist; and the most obvious example of that is the rule on husbands, which has been discussed several times in your Lordships' House, where the Government went into contortions to ensure that as many white husbands as possible would be admitted and as many Asian husbands would be excluded. We said, when that rule was first published, that it was racist. We said that it will be shown to be unlawful at Strasbourg. The Government at that time replied that if a case was brought they believed that they had good arguments to defend themselves—although we were never told what the arguments were and we are none the wiser today.

Similarly, the provisions regarding elderly relatives (which the noble Earl has mentioned) were designed to keep out the parents of those who came from the Indian sub-continent. Everybody knows that that was the motive of the Government in tightening up the restrictions on this category of immigrants as they did in 1980, because that was where elderly parents were coming from. They were not coming from the white Commonwealth countries. The rule on single-parent families, on the other hand, was aimed at the West Indian immigrants because, as the report points out, in the West Indies their cultural patterns do not see marriage as something of high importance. Children are frequently brought up by their mothers alone with the aid of the extended families that they have in the West Indies. When the mothers came to England, they often left the children in the care of an aunt or a grandmother while they were getting started in this country. But the rule for a child coming here to join a single parent is that the parent must have exercised "sole responsibility" for the child; and that provision "has discriminated particularly against West Indians", as the CRE report plainly says.

Then, as regards the iniquitous system of quota vouchers, mentioned by the noble Earl, under which the Government created an artificial queue of our own citizens wanting to enter the country, the European Commission found (as the CRE reminds us) that the scheme was racially motivated. The effect of it has been not to reduce the numbers of people entering the country over, say, a 20-year period. but to delay their arrival by as much as eight years. This has meant that in the meanwhile some applicants have become destitute who might have brought capital with them had they been allowed to enter when they first applied. Secondly, it has meant that children who would have been brought through British schools instead come here as young adults with social and educational handicaps.

The distinguished American historian, Barbara Tuchman, in her latest book, The March of Folly, which I commend to the noble Lord the Minister, discusses an inexplicable characteristic of leaders—their propensity to continue with policies which are directly contrary to their own self-interest and that of their people, in the face of well-reasoned advice. She cites as examples the medieval Papacy, the rule of the British in North America and, finally, in a very long chapter, the experience of the United States in first becoming embroiled and then persisting in the military conflict in Vietnam. I think that if one wanted to add a chapter, particularly for British readers, no better subject could be found than our treatment of the East African Asians, because they have got so much to contribute to this country that it was an act of inconceivable folly as well as of racist inhumanity to make them kick their heels for years in front of British high commissions in Nairobi or Bombay.

When you look at the splendid example they set, in terms of industry and efficiency and in the management of small businesses (and some now that are not so small), their well-knit family life, their great respect for the law and their love of education, I think it is impossible to deny that their presence here is an enormous asset for the nation.

I mentioned family life. A further review of the Helsinki Accords is to be held in Ottawa in May this year and among the topics to be discussed is the reunification of families, to which principle the signatories are supposed to be committed. As your Lordships know, the Soviet Union continues to violate this agreement by denying her citizens the right to emigrate to join their wives or parents in Britain. Israel or the United States. We rightly condemn that policy; but are we any better, when our immigration law equally separates husbands from wives or parents from children? Are we not, on the other hand, just as guilty as the Soviet Union in that our policy is directed against people of particular ethnic groups?

I should like to mention a particular case which I took up with the then Minister, in March 1981, of an elderly lady who wanted to join her two sons in England. The reference number is A219549/2(s), if the Minister wants to look it up. She had been unsuccessful in her application because it was said, erroneously, that she had substantial resources in the shape of land which had been inherited from her late husband.

I conducted her case before the adjudicator and proved to his satisfaction that she had not any land. She relied on her two sons in this country for support. But the adjudicator nevertheless turned down the application on the ground that she had a brother to whom she might have turned in India, even though he lived several hundred miles away from her and no evidence was brought to show that he was willing to look after her, should it prove necessary.

This lady, not long before the hearing, had had a bad fall and broken her hip. That necessitated an operation and the adjudicator said that as the appellant had suffered what at her age was likely to be a serious injury,

"no doubt the Secretary of State would be prepared to look at the matter outwith the immigration rules".

Accordingly I wrote to the Minister, expecting in the light of such a clear recommendation that my plea would be successful. But the then Minister, Mr. Raison, rejected the submission in these terms, which I should particularly like your Lordships to note, because what he says in this letter to me applies to every case and not just to the one I am quoting. He says:

"I accept that the provisions relating to the entry of parents and grandparents are strict. We made it quite clear in our manifesto that … they ought to be".

This was a deliberate act of policy, to exclude parents and grandparents even in the cases where, as the adjudicator said, they merited the sympathetic attention of Ministers. Even when last year the brother to whom this lady was supposed to be able to turn for support in her own country had a prostate operation and her sister-in-law had a stroke and was totally incapacitated, the Minister still said that she was unqualified to come here. It was only after she had arrived in this country as a visitor and been granted temporary admission, and it was found that she was medically unfit to travel back home, that after four years' struggle the Home Office finally relented. As the CRE comment in their usual measured language:

"It is not fundamental to the overall control of immigration to place difficult obstacles in the way of families making the best provision they can for elderly dependants, nor it is helpful to the promotion of good race relations to do so".

In the case of husbands the CRE make the important point that the guidance and criteria established for applying discretion under the 1980 rules were neither published nor subject to test through appeal, yet they came close to being a subsidiary rule in themselves. Now that the rule is partially revealed by the CRE's report, we see that there are many cases which have been determined since then and which, in the light of the changes, would not have been refused if they had been determined under the present guidance given to the immigration officers.

But the CRE believe—and I heartily agree with them—that it is fundamentally unfair to demand that a marriage was not entered into with the primary purpose of establishing a right to settlement, because that is a highly subjective criterion and one that is extraordinarily difficult for even the best-intentioned immigration officers to apply.

Here, again, I am going to cite just one case to show the lengths to which the Home Office goes to get rid of one single black immigrant. This is the case of a Nigerian who entered Britain originally as a visitor in 1977. He has been here continuously for eight years and his reference is Y.30641. This man is married—I should add to a British citizen. He has two children by her, with another one on the way, and he also acts as a father to another child that his wife had from a previous relationship. He has been running a successful small business selling security systems. So one would have thought that if he were not black, he would be the kind of person who would endear himself to the Tory Government, with their love of small entrepreneurs.

I accept that he had no entitlement to stay here under the rules, because when he got married he was not within his permitted leave to remain. But one would have thought that the Minister could have had regard to the circumstances and exercised compassion, particularly when one considers the principles outlined in the IND bulletins, which are summarised in paragraph 5.9.7 of the CRE's report—and very interesting reading they make. The rules were not intended to disrupt genuine, established relationships. The wife's connections with the United Kingdom were to be taken into account. The interests of the children were also to be taken into account. The wife in this case is English by birth. She has had a hard time with her pregnancies with two or three caesarians, and was dissuaded only with difficulty from having an abortion this time. She cannot face going through another confinement without the support of her husband. One of the children has suffered mental illness as a result of the threat of losing his father.

When the Minister, in spite of all the circumstances that I have summarised here, decided that he would throw the husband out, leaving a pregnant woman destitute with three small children. I sought the help of an excellent solicitor who thought that the court might agree to hear an application for judicial review of the Minister's decision. With only a few minutes to spare before the husband was to be removed, the solicitor lodged the application. The Home Office nevertheless sent the police round to the flat where this family lived the next morning, without waiting to see what the court would decide. The Minister tried to pretend that no application was at that time before the court, because the table application had been rejected, which is quite normal, and the Minister knows that the procedure then is for the solicitor to renew it orally before a judge of the High Court or the Divisonal Court. Fortunately, the husband was out when the authorities came round and he made himself scarce until the hearing which, in the event, was successful. But if he had not been able to keep out of the way until he had the protection of the court, he might have been bundled out of their jurisdiction and the decision of the court to allow him leave to apply for judicial review would have been of no effect.

In this case the Minister also violated his own rule for dealing with cases submitted for the exercise of his discretion—that is, that he will always allow the constituency Member the right to make representations before reaching a final decision—because the Minister knew that in this case the Member was Mr. Clive Soley. He knew that Mr. Soley was intending to make a submission on behalf of the husband. The Minister now tries to make out that when he originally promulgated the rule that constituency Members of Parliament would always have the right to make representations it was to be qualified by the unwritten rule that, where someone else had already made lengthy representations, the constituency Member was to be excluded. That really is changing the rules in the middle of the game.

I am very sorry that the Government should have tried, as they have done in their published comments on the CRE report, to brush aside as misguided or as of no importance a painstaking, comprehensive analysis, which has been produced by the very body which they set up to advise them. When the CRE, with the enormous weight of their authority, endorse the complaints about the immigration control system which have been made over the years by every organisation representing ethnic minorities, by all the law centres which try to help the thousands of victims of the immigration rules, as well as by the churches and the trade unions, then surely the Government might reconsider their attitude.

We are not talking about a vast increase in the number of people who are permitted to enter this country. In the case of United Kingdom passport holders the net addition over the longer timescale is nil, and the same is true of the elderly parents and grandparents who would not in any case have very long to live with their descendants in this country. A few thousand more husbands and financés might come in if the primary purpose rule was abolished, and an even smaller number if single parents did not have to satisfy the Minister that they held sole responsibility for the child.

The net effect of all the changes which are mentioned by the CRE is really trivial compared with the movement of peoples in and out of this country. But the effect of continuing with the policies of the Government is not at all negligible. It makes blacks and Asians in this country feel that, whatever may be said about racial equality, there is an undercurrent of hostility towards them in the top levels of British society which will ensure that they never get a fair deal.

We believe in genuine equality between all the communities of the United Kingdom. We believe that we must eradicate discrimination at the ports of entry just as we smash it within the boundaries of the United Kingdom.

My Lords, I should like to thank the noble Earl, Lord Listowel, for raising this matter of immigration procedures and for the terms in which he has done this, and I should like to associate myself with what both he and the noble Lord, Lord Avebury, have said.

I should like to start with some compliments. I am sure that all who have been concerned with this subject have been helped by the Home Office publication, Report on the Work of the Immigration Nationality Department, which was published last year. In particular, I welcome the greater openness which the department has shown in the more recent past. For example, I am glad to say that there will be an official visit by members of the Board for Social Responsibility of the Church of England, as a result of conversations we held with the Home Office last year, to Lunar House, the headquarters of the department. I much look forward myself to a visit later this month to Heathrow so that I may observe some of the immigration procedures at a port of entry.

While all this marks a new and welcome openness on the part of the Home Office, this is not to say that difficulties have been resolved, and all awkwardnesses have been removed. It is surely significant that the report of a formal investigation by the CRE was published at about the same time as one by the UKIAS, and another report authorised under the Episcopal Conference of the Roman Catholic Church. I mentioned the latter to show that the Church of England is not the only Church in this country which has been greatly disturbed by our immigration laws and control procedures.

I am grateful to the Commission for Racial Equality for its comprehensive report, and also for the sobriety and calmness of its style, which is not always to be seen when people deal with this very sensitive area. Those of us who have criticised the nationality law and the immigration procedures have done so on two accounts: first, because the law seems to us in some respects unjust; and secondly, because of additional injustices which seem to have been caused by procedures. I do think, however, that sympathy is due to the Home Office because undoubtedly there have been fraudulent attempts to gain illegal entry and settlement in this country, and I even have some sympathy with them in imagining that those who make fraudulent tax returns are not likely to make fraudulent entry applications. I wonder whether the Commission for Racial Equality has been sufficiently understanding on this aspect.

It is not always easy to cope with the sheer numbers of people who wish to enter the country. One must agree that some delays are inevitable. It is good to see, according to the 1984 Home Office document, that delays in entry clearance have been reduced—although almost 20 months in the main queue at Dhaka is too long. I hope that steps are being taken to reduce that delay.

I rise to speak in your Lordships' House tonight for two reasons. First, I have to deal with this matter as best I can as chairman of the Board for Social Responsibility of the Church of England, secondly, as Bishop of the See of Birmingham, which in some respects has the greatest concentration of ethnic minorities in any city in the United Kingdom. For example, within the city as a whole 15 per cent. of all householders come from the New Commonwealth and Pakistan. For the inner areas, the figure is 43 per cent.

All these are in parishes manned by priests of the Church of England, some of them having more than 80 per cent. of ethnic minorities in their parishes; I should rather say, ethnic majorities. We are therefore in a good position to know the sentiments among those families who have relations overseas. I must tell your Lordships that there is no question that the operation of the immigration procedures, taken in conjunction with the new nationality law, has caused much fear and resentment among the black population.

Fortunately, because of the policies in the city as such, there is not much racial unrest—but the fact that our ethnic minority communites are peaceable does not mean that they do not feel deep hurt at what is happening. I may say that this impression, which has been given to me through my pastoral contact in these areas, is borne out by the experience of Members of another place who have been trying to help these people secure their just rights of settlement without too much delay and with dignity

I appreciate that Her Majesty's Government have stated that they cannot regard reunion of the family as a fundamental human right, but I hope that applications for family reunion can be treated more sympathetically than they are being treated at the moment. It is on the subject of the family that I will concentrate most of what I have to say.

It is important that Recommendation 36 of the CRE should be taken very seriously by the Home Office—namely, that the criteria and test used by entry clearance officers in assessing whether the parent has exercised sole responsibility for the child should be reviewed, as the noble Lord, Lord Avebury, has suggested; that appropriate criteria and standards should be defined in the fullest possible detail; and that instructions and guidance should be issued to ECOs to ensure that they are applied consistently and fairly.

As your Lordships will know, a child may join one parent settled here if the other is dead—but if only one parent is settled and the other is not, or is not being admitted for settlement at the same time, then the child has no automatic right to join that parent. In such circumstances a child may be admitted for settlement only if the parent settled in the United Kingdom has had sole responsibility for the child's unbringing.

The operation of this regulation can be very unfair on West Indian families. Considerable numbers of West Indian women migrated in their own right to the United Kingdom, leaving behind children to be looked after by others—usually the maternal grandparents. The definition of sole responsibility ought to be revised, as the CRE suggests. Obviously it cannot be applied rigidly or literally since the very fact that a child was left behind shows that someone else was bound to be looking after it. I would have thought that for the wellbeing of the family—and I hope that Her Majesty's Government have the wellbeing of the family in mind—it would be appropriate for ECOs to be given discretion to admit children in all cases where the mother is able to give evidence of being able to look after them, to maintain them, and to care for them.

It is most important that children should be with their mothers. Do not Her Majesty's Goverment think that? I cannot understand why there is discrimination between a child joining two parents on the one hand and a child joining only its mother on the other. If we wish the family to remain strong and healthy surely we should at all times try to have children in the care of their own mothers.

I also think the current rules bear very hardly on the admission of elderly and other distressed relatives, as has been suggested by the noble Lord, Lord Avebury. Plainly the rules are devised to minimise the numbers admitted into this country. Originally they were only admitted if they were "without close relatives in their own country to turn to". Happily, the High Court judgments have considerably improved the interpretation of this phrase—an improvement which I should have thought would have been made by the Home Office in the first place. It would seem humane to me if the rules could be interpreted in such a way that aged parents and grandparents were allowed to join their children or grandchildren if the latter could show that they could provide the necessary support and accommodation. Incidentally, it would greatly reduce the work of the immigration officials.

A more difficult matter concerns the admission of husbands and fiancés, as has been mentioned. The amended rules which were laid before Parliament in 1983 extend to all women British citizens the right to have their husbands to settle with them in the United Kingdom. The change seems to have been caused by the finding of the European Commission on Human Rights in 1982. Nonetheless, the amendment has twisted the rules. Now, if a man wishes to enter the United Kingdom he has to prove to the ECO that the marriage was not entered into for the purpose of securing settlement and that the parties intend to live together permanently as man and wife. In other words, the burden of proof has changed and those who are married or intend to be married have to explain their reasons for marrying.

Changes in the rules have had very significant effects on the numbers procuring settlement. Hypothetical questions can now be asked by ECOs in order to try to get a man to admit that he is marrying a woman in order to settle in this country. Those of us who have to face hypothetical questions know how very dangerous they can be. The reasons we all marry are often complex, and it is even more so in the case of arranged marriages such as are customary on the Asian continent. Arranged marriages there are usually made for the economic and other benefit of the parties and their families and the present procedures of ECOs do not seem to distinguish this from marriages made specifically for the purpose of immigration.

Under the 1983 rules, according to the CRE report, the ground that marriage was primarily for immigration purposes accounted in part, or wholly, for three-quarters of the refusals. Yet how can proof be available that one marries for one purpose rather than another? Many of us would find it very difficult in those circumstances to satisfy the ECO. I hope that the Home Office will take action on Recommendations 37 and 38 concerning the admission of husbands and fiancés into this country. Great pain is caused to many families and I fear that in many cases wrong decisions have been made. Those whom God has joined together the immigration rules put asunder.

I am also concerned about entry clearance for visitors, especially members of a family. Questions are even asked on why parents wish to visit their children or grandchildren. Visitors have been refused on the ground that such visits are inopportune. I should have thought that grandparents have a natural desire to see their children or grandchildren. No doubt your Lordships have received much pleasure and satisfaction from such visits. I hope that ECOs can be instructed to be more sensitive and understanding in this area. I do not in any way blame them; it is a question of the insensitivity of the rules. I hope that the noble Lord the Minister will look with greater sympathy on the work of the Commission for Racial Equality than has been shown in another place, where the report has been claimed to be fundamentally flawed and unrealistic. We have as yet had no detailed response to this series of 56 reasoned recommendations by the statutory body charged by Parliament with responsibility for race relations. I hope, as others have said, that the Minister will give us some undertaking that this will be done in detail.

The Government have complained that the report does not face up to the fact that there is more pressure to emigrate from some countries than from others. It has been said that to deny that flies in the face of common sense. It is that assumption, I fear, which underlies the reversal of the norm of British justice. In the law courts it is assumed that a person is not guilty until he is proved guilty. But it is clear from reading the report that the attitude of the entry clearance officers should be that a man is likely to be making an application which contains lies or flaws. That is the assumption underlying the immigration rules. It is that negative attitude towards people who are often ignorant and even unable to speak our language that causes such concern among the ethnic minorities of the city of which I am bishop. I think that we need clear evidence that there is pressure to emigrate from certain countries before we accept it as a sufficient reason for large numbers being turned down from those countries.

I should also like to express the hope that recommendations in the report for the training of ECOs will be implemented. I should like to urge that the secret instructions to immigration and entry clearance officers, which seem to have been made available to the Commission for Racial Equality—and I am delighted that they have been—be made available to all. Why should they not? Surely we have nothing to hide in the matter; or, if we do have something to hide, then would it not be better for the rules to be changed so that they may openly be published?

The scriptures say that there is much need to show consideration and kindness to the poor and to the deprived, and especially to the strangers within the gates. This is one of the reasons why the Church of England in General Synod has called the nationality law and the immigration rules in many ways unchristian. We know that there are obvious difficulties in the ending of a great imperial chapter in the life of this nation, when millions of people overseas were subjects of the Queen, many of whom consequently received British citizenship. At the same time, these people deserve justice and to be treated with respect and with dignity, despite the strains that that may at times place on the mother country.

So I should like to end by once more, very genuinely, thanking the Minister for the greater openness and the greater information that he has made available. But at the same time, I should like to renew my expression of hope that the recommendations made by the commission should not be dismissed out of hand. I think we deserve to know in detail the reasoned comments of Her Majesty's Government upon this important report and, indeed, their defence against those who have believed that their policy is racist.

My Lords, I should like to add my thanks to the noble Earl, Lord Listowel, for asking this most appropriate Question this evening. My involvement in the matter of immigration procedures is twofold. First, for the greater part of my life I served in the third world as a diplomat, and I was there concerned, although most of the time not directly, with entry clearance procedures. Secondly, since my retirement from the diplomatic service I have concerned myself with refugees, although not of course to the same extent as the noble Lord, Lord Avebury, and perhaps other noble Lords; and many of those with whom I am associated and have been trying to help are applying for political asylum here.

I should like to open by adding my own very warm tribute to this really splendid report. It is detailed, it is clearly expressed, and I think that its recommendations are wholly admirable, although perhaps I shall be forgiven for saying that it is a little long-winded on occasions. But it has one very important lacuna which I cannot understand. I have searched high and low in this report and I cannot find any reference to refugees or to the problem of those who seek political asylum; and that is, of course, as I am sure the noble Lord the Minister will confirm, a very important concern of the Home Office.

Let me start by dealing with overseas immigration procedures, which are fairly fully covered in this report, although unfortunately the investigators confine their remarks mainly to the Indian subcontinent. In most of the Foreign Office posts in which I have served immigration matters are very often dealt with by junior officers, some of whom—let us face it—have no specialist knowledge in this sphere. Others—again, let us be frank—are not all that keen on the work and find it hard to adjust themselves to the people and their problems. These problems are set out, I think admirably, in pages 34 to 39 of the report; and indeed how evocative they are. One can visualise these junior officers—some very junior indeed, in their early twenties—struggling to separate the sheep from the goats among these applicants, struggling very often against a background of heat and other discomforts and frustrations of which many of your Lordships will be aware.

I fear some succumb. I remember one case of a man who was serving with me in Uganda at the time when we were having great difficulty over the Ugandan Asians. They were then under threat of expulsion. Many of them wanted to come to Britain but a quota system was applied and very few of them could come. This officer was so concerned that he staged a kidnap. He persuaded two of his Asian friends to remove him to an island over the week-end. It was a fake kidnap to draw attention to their plight. Another officer on my staff was so concerned with the problem of immigration and all the applications he had that he almost worked himself to a breakdown. He would never leave his office until 8 or 9 o'clock at night. Yet other officers—forgive me for saying so—adopted a somewhat cavalier and curt approach to these applicants.

In that connection, I direct your Lordships' attention to recommendation No. 10 of this report, which I will not read out. It deals very clearly and very helpfully with the problem of interviews. Chapter 9 of the report deals, again in an extremely useful way, with training. But here again it is confined mainly to the training of Home Office officials, ECOs working in the Home Office, a few of whom of course work abroad.

I should like to consider particularly the training of those Foreign and Commonwealth personnel for whom short courses are now arranged. This arrangement has only been operating since 1978 but I think it ought to be extended. It must also—this is most important—be reinforced by adequate training and direction in the post, because overall instructions issued in London cannot cover the needs of every individual post.

Another very important consideration which concerns overseas applications is the delays which arise. In some cases, a matter of nine or even 10 months will elapse before applicants are called for their first interview and that is only the beginning of a very lengthy process. In that connection, I should direct your Lordships' attention to recommendation No. 27 which deals with this point very clearly.

My second main area concerns refugees seeking political asylum in Britain. Here, if your Lordships will forgive me, I think I must enlarge a little on the speech I made in your Lordships' House on 27th February when introducing a debate on refugees in the third world. On that occasion, as so often happens in short debates, I was fighting the clock. In the end I won my fight against the clock, but at the cost of leaving out quite a lot of things I wanted to say. One of the main points I tried to make was about the delays which inevitably arise in this country in processing applications for asylum.

Before referring to that point, I should like to counteract any impression I may have left in that speech and perhaps on earlier occasions in your Lordships' House and pay a warm tribute to the Home Office officials who deal with these applications. Many of my friends who have had to deal with them have said that they are considerate, courteous and conscientious, and even, if I may say so, compassionate. Yes, they are all those things. I do not underrate the difficulty that these officials face in trying to sort out genuine from fake applications.

But the problem of delays is very real. It is perhaps the crucial issue that affects so many people applying for asylum. I mentioned this in my debate. The noble Lord, Lord Trefgarne, in reply, expressed surprise that some applications should have to wait several years. I can quote the case of a Ugandan lady who made her first application on 17th February 1983. She was told on 31st January 1985 that her application had been refused. The decision may have been quite right: I am not to say. But it was refused, and she has no right of appeal.

These two points of the length of time and appeal are important. If your Lordships will forgive me, I should like to quote from memoranda submitted by the British Refugee Council to the Home Affairs Committee on Race Relations and Immigration:

"Some asylum-seekers have to wait up to two years before receiving a decision on their application. This 'pre-asylum period' during which the applicant is not allowed to work"—

that is a most important fact—

"is a most depressing and debilitating time. In some cases permanent psychiatric disorders may result. The Home Office has said that their aim is to speed up the procedure. We warmly welcome this. However, it is to be expected that there will always be a few cases which are not decided within a reasonable period".

In regard to the right of appeal, according to this very interesting memoranda:

"Certain categories of asylum-seekers have no right of appeal against a refusal of refugee status. Whether or not a particular applicant has a right of appeal does not even bear any relation to the merits of his or her case, but is dependent entirely on the immigration status of the person at the time of lodging the asylum application. We believe this to be quite wrong".

Indeed, it is quite wrong.

Another procedure that is used from time to time by the Home Office, again quite rightly, is what is known as "exceptional leave to remain". This means that the applicant is not given permanent asylum in Britain; he or she may not work; they are merely allowed to remain here, and every year their permission to stay is renewed. There have been some cases where this permission has been renewed annually for 10 or more years. One friend of mine came to Britain in the spring of 1974. He is still waiting for a permanent answer, in the spring of 1985. According to the memoranda, permission to stay should be permanent after a period of four years.

Finally, I shall deal with a matter that is perhaps closest of all to my heart. I mentioned this in my speech in the debate on refugees; and, again, I shall mention it briefly. It is the fear that so many refugees experience over the delay. They feel that there is a Sword of Damocles suspended over their heads. It is a heavy sword and it is a sharp sword. That sword represents their fear of what will happen to them if they return to their own countries. That applies forcefully to Uganda. I have had assurances from the noble Lord, Lord Trefgarne, that there are some signs of improvement. I am sorry that I cannot accept that. All the information that I have from the Minority Rights Group, from Amnesty International and particularly from Ugandans here in Britain indicates that people who return to Uganda from Britain are in great danger of their lives. This is partly because the governing party in Uganda knows that there are opposition elements here. Even if these refugees in Britain have not been associated with them, they are in danger. I wish to make that point very strongly.

To conclude, I should like once more to commend this report to your Lordships and to express the hope that the noble Lord the Minister will take note of the points I have raised.

My Lords, I should like to express my profound gratitude to my noble friend Lord Listowel, with whom I worked for so many years on this kind of subject, for putting down this Question. He has saved me doing the same thing. I feel that the House has not measured up to its reputation for dealing with crucial human issues, because of the very sparse attendance for this important debate.

I wish to ask the noble Lord who is to reply for the Government a number of questions divided into two broad sections. First, I should like to ask him to explain—I know he cannot defend—the response and the attitude of the Government to the whole procedure for the examination of immigration regulations by the Commission for Racial Equality, which, as my noble friend has pointed out, is a statutory body. It seems to me that the Government have attempted to undermine this report at every stage. Initially the Government attempted to ban the investigation until it was unsuccessful in taking court action. Even before the report was completed, it was held up for 12 months in the Home Office. After it was published the Minister responsible for immigration claimed, as the right reverend Prelate has pointed out, that the report was fundamentally flawed and unrealistic, and then he went on to describe himself as appalled because the report was disappointing. I should like to ask the Minister whether he shares those sentiments.

Secondly, up to now the regulations and guidelines for immigration control and immigration officers have been very largely secret. This report has exposed them publicly for the first time. Are not the things that have been exposed appalling? I am referring to the way in which some immigration officers—I emphasise "some"—have been dealing with immigration control. Are not the revelations about the way in which immigration officers are being trained, and the attitude to that training, appalling also? We are told that the staff at Terminal 2 at Heathrow prepared what is called a Moroccan survey, which concluded that:

"Moroccans seem to be both simple and cunning".

Immigration officers are being trained with the aid of a paper which, according to the quotation, states:

"Like Ghanaians, Nigerians tend to have ambitions and plans out of all proportion to their capabilities and circumstances".

How can we in this country maintain any pretence of a non-racial attitude with comments like that flying around the immigration officers?

On the other side, we read of officers describing in writing their refusal to grant entry permits with phrases like, "Well done", "Looks as though you have hit the jackpot again". Is that the language of a Britain that has accepted non-racialism as a principle of national life? Moreover, they go on to describe a possible acceptance as, "I may have to issue here". I do not believe that the noble Lord the Minister who is to reply can agree with any of those sentiments. If he does not agree with them, then we are entitled to ask him what he intends to do about them, because the commission has made suggestions as to how this situation can be rectified.

Before moving to those recommendations, there is one further issue arising from the criticisms that I should like to draw to the Minister's attention. I am referring to the general principle that appears to have entered into the immigration control procedure as regards pressure to emigrate from some countries more than from others. This has not been substantiated so far by any statistics or by any evidence. I suggest that the Home Office should either publicly withdraw it or substantiate it. Again the commission points out that this concept has been used as a camouflage for direct racial discrimination.

What I should like to appeal to the Minister to do—and do it tonight—is to throw his weight on to the balance of probabilities and to attempt to get all genuine applicants into this country, even if that means that certain bogus applicants are also admitted. Is he able to say specifically that the Government would prefer to get 100 per cent. of genuine applicants admitted to this country even if that includes a tiny percentage of bogus applicants, rather than to put the emphasis on keeping out those bogus applicants and thereby keeping out a number of genuine applicants? It is surely a matter of approach, a matter of attitude, which is all important both to race relations and to international relations.

It is unfortunate that the noble Minister's colleague in another place does not appear to be concerned about the revelations in the report of the racist behaviour of certain immigration officers. His comment was that their remarks were:

"unprofessional but certainly do not warrant stringing up entry clearance officers by their thumbs and flogging them."—[Official Report, Commons, 28/2/85; col.459].

Surely that is not a serious comment on what has been a very serious, but calm, quiet and rational criticism of the attitude of some—but only some—of these officers, but a serious comment on a system which allows such officers to influence profoundly the lives of many men, women and children. I would just ask Mr. Waddington, who has made these comments, how he justifies the revelations that have been made in the commission's report alongside the permission given to Zola Budd to enter this country within a few days of application. Whatever we may think about it here, I believe that the noble Lord the Minister would agree with me that in the outside world it looks like nothing short of blatant racial and colour discrimination.

So far the Government do not seem to have expressed any worry about the number of wives and children in particular who, as this report reveals, have been refused entry to this country unlawfully. As the right reverend Prelate has pointed out, this is an attitude which is keeping families apart. In some cases it is unlawful, and has been shown by the commission to be unlawful.

Have the Government any plans to right this breaking of the law by their own officers? I believe that we have a right to ask that question of the Minister, and I believe that the Minister will want to do something about it. This is an opportunity in which he can give a clear assurance on behalf of the Government that the law will no longer be broken, and that the regulations will be so tightened that there cannot be any further law-breaking.

May I quote again from the report in support of the plea I am making to the Minister. The commission says:

"Too great an emphasis has been placed on the operation of the procedures on the detection of bogus applicants at an unacceptable cost to genuine families and to race relations generally. In our view"—

goes on the commission—

"of the basic mistakes which it is possible for an administrative system of this sort to make, it is far worse wrongly to refuse a genuine applicant than to admit a bogus one."

I hope that the Minister will be able to respond to that.

The report makes a number of recommendations. We look forward to the Government responding to them. I know that it is too early to respond in detail tonight. I hope that the Minister can respond by creating a new and positive atmosphere in the place of the negative attitude that has been taken so far. I hope he will see that, as the commission says, the promotion of good race relations should be a central concern in immigration control, not the exclusion of people that the Government do not want (simply through statistics and numbers) to enter this country.

The report goes on to say that the Race Relations Act should be extended to cover immigration control. I think that the Minister may be able at least to respond conditionally to that recommendation tonight, because that recommendation is crucial. It is fundamental to the cleaning up of the immigration process, so that no longer can be there be the slur of racialism upon it.

It is clear from the commission's report that better information and better training facilities are necessary for the immigration and entry clearance officers. Will the Minister give a promise that he will look into this matter not only sympathetically but avidly, and will see that the training and the information services are improved in the way that the commission recommends?

Finally, and perhaps again of equal importance with the application of the Race Relations Act, is the suggestion that an independent body should be set up to investigate complaints of unfair treatment; to make inquiries; to publish reports; to arrange to oversee the Home Office administration of control; and to show where that maladministration can best be tackled.

May I draw the attention of the House to the fact that in another Bill before this House, the Administration of Justice Bill, it has already been pointed out that Clause 43, which would have disallowed the right of appeal on judicial review (which applies particularly to immigrants) has already brought fear to many immigrants that their opportunity to question and to examine Government officials on immigration issues is being whittled away. Fortunately, the noble and learned Lord the Lord Chancellor has withdrawn that clause and we are still to debate his suggested alternative. But let me put it to the Minister that that fear was created by the inclusion of Clause 43 in the Administration of Justice Bill in the first place. That fear was created among immigrants. And this fear was expressed on all sides of this House. Surely, this recommendation of the commission to set up an independent body capable of correcting the mistakes which are inevitably made by human beings acting in the position of officers in this very delicate task and the creation of such a body would restore confidence to the administration of the Home Office and to the reputation of the British nation.

My Lords, this is a debate—and a very important one—initiated on an Unstarred Question put down by noble friend Lord Listowel, to whom gratitude has already been expressed. I, in turn, in trying to wind up this debate from the Opposition Benches wish to associate myself with that expression of gratitude. If, in winding up I were to take a lot of your Lordships' time, I believe that that might lead to the emigration of certain of your Lordships as against the immigration that we are looking at this evening. I do not propose to do that, but I must make the following comment, and I do so in all sincerity.

The report that we are talking about tonight is a report of nearly 200 pages and, as has been mentioned, it took some five years of solid work to produce. I tried to trace—and the noble Lord the Minister will, I am sure, correct me if I am wrong—what debate has so far taken place in Parliament in regard to this important report which affects so many of our present fellow citizens and their families. I can trace only a question and answer session in another place on 28th February, at column 459 of the Official Report. It occupies less than half a column and much of it is made up of some remarks of the Minister, Mr. Waddington. Knowing him as I do and respecting him as I do, I think that on review he would wish to withdraw some of the remarks that he made on that occasion to which reference has been made. I say that because—and I am now looking at Hansard—he said that he was,

"certainly appalled because the report is disappointing and does not address itself to the real problems with which we are faced".

That is one quotation.

The other quotation, to which reference has already been made, deals with the unfortunate remarks made about some immigration officers. It is in rather exaggerated language and is quite untypical of the Minister. He must have been rushed when those very short questions and answers were put to him. He used words that were never even suggested by the report. He could not see why immigration officers who had been "unprofessional" deserved,

"stringing up … by their thumbs and flogging".

This language is so untypical of the Minister that it is quite obvious to me that he had not got real time to consider the report or his reaction to it.

Here we are in this House, in this bulwark of freedom that we so often call it—and, I believe, rightly so—discussing this important report at five minutes to eleven at night with only a few Members of your Lordships' House present to hear the debate. It is not the right way for Parliament to treat a report of this nature. Indeed, if I use the Minister's word in another place—"appalling"—I think it would be more appropriate than its use on the occasion that I referred to.

The whole question of race relations, which we regard, and rightly so, as one of the great problems of our country, is an important matter. Now that it is a multi-racial country we can be proud of that; but it is a great problem and I suppose it would be true to say that the first reaction of a family coming to this country, be it from Africa or be it from any part of our old empire and now our Commonwealth, to earn the hospitality of these shores, if they come within certain regulations, and the whole attitude, I suppose, of the children who are listening, will be governed by their treatment when they arrive here at the point of entry. The whole question of the interviews—how long they last, the cross-examination, the attitude of the people examining them—will make them feel either that they are walking into a just country, into a country that, if they merit entry, will welcome them, or that they are just not wanted. And even if they attain entry, is not that a disastrous way in which to start upon their citizenship, or at least their residence in this country?—and one which may be repeated, unfortunately, by many examples of finding that they are really not wanted: no jobs and not wanted.

It is therefore so important—I do not think I have to tell the noble Lord the Minister, with his obvious attitude of humanity to these matters—that these officers we are talking about get it right and are told to get it right. That does not mean that I am not going to pay a tribute, as I readily do, in two respects. First, the majority of the officials do get it right. It is the minority that we are talking about tonight, and the minority have got to be told, "This attitude is untenable".

The other thing I want to say concerns something the noble Viscount, Lord Buckmaster, was talking about. He said there was no reference in the report to political refugees. I want to pay a tribute, as somebody who has had some experience with the Home Office of trying to get political refugees, be it from Iran or from other places of persecution, into this country. I have found complete humanity shown by the immigration officers who have examined the cases of political refugees, and I want to pay my tribute to the Minister, Mr. Waddington—having said what I did about him—for his absolutely merciful and understanding reaction to the applications that I know have been made to him.

My Lords, having said that, why is it that the procedures and the instructions are so secret? We have had debates in this House on instructions that are issued to the police, and the noble Lord the Minister, when dealing with this matter only a matter of a week or so ago, in answer to an amendment that I had the privilege of moving, readily conceded after reflection that yes, there should be reports about the guidelines issued to the police—or issued, rather, to a prosecuting department by the Director of Public Prosecutions and that the general guidelines should be made public in a report.

Why is it that in the case of immigration procedures one finds that instructions to immigration officers and entry clearance officers are confidential, that they are supplemented by unpublished guidance notes and papers and that the interview notes are not available to applicants or their advisers, even on appeal? I do not understand the reason. If we are proud of the way we do things, and we do them fairly, why should all this be secret? Why should we not publish these things to the world and say, "This is how we handle our immigration policy. These are the instructions that we give to our immigration officers"? Why should it just be that the members of this commission were allowed to see the remarks that were made and then commented on them? If they were public, I am perfectly sure that the immigration officers would never make those remarks. They would know perfectly well that it would be scandalous if they were published, and obviously people would take them up.

There have been comments about the recommendations on training of immigration officers. I think that the recommendations that have been made in this report are worthy of very considered judgment by the Home Office Minister who normally deals with this matter, but whose responsibility is put upon the shoulders of the noble Lord, Lord Elton, tonight in our House.

I was very glad, as I am sure we all were, to hear the right reverend Prelate the Bishop of Birmingham, whose work in this field on the spiritual side. I suppose, about equals the work of the noble Lord, Lord Avebury, on the lay side. We pay our tribute to both of them for their great understanding of these problems and I am so glad, as I am sure are all your Lordships, that they participated in the debate tonight. I also pay my tribute to my noble friend Lord Hatch of Lusby, who takes a prominent part in these matters and is always heard in your Lordships' deliberations whenever a question of immigration occurs.

The last two points that I want to make are the following. We have talked about the onus of proof. When you are in a court of law, it is very easy for the trained advocate to talk to a jury about the onus of proof, about what the balance of probabilities means in a civil court, and what the very exacting onus of proof is in a criminal court, before somebody is found guilty. Could it not be an instruction in simple language, that the balance of probabilities means that when you have an immigrant you take it for granted, unless the contrary be proved, that he is telling you the truth?

Of course, you must examine what he is saying, but one gets the impression from this report of, I am sure, fair-minded people, that the onus is quite the other way; that it is taken for granted that the applicant who is asking for entry for himself is most likely telling a pack of lies, and that what one has to do is to take that for granted and only when he has proved conclusively that they are not all lies do you say, "This is a proper application and it should be granted."

My last point arises out of the whole question of procedure and has to do with appeals. We have quoted so often that it becomes almost a truism the phrase that justice must not only be done, but must be seen to be done. I almost apologise to your Lordships for quoting it once more. But when anybody comes from abroad and parts of the Commonwealth where there is not the freedom that many of us prayed would come when they got their independence—there may be reasons for this and it may evolve; but I shall not bore your Lordships with a diatribe upon that tonight—and finds that the adjudicator is appointed by the Home Office, whose official had first turned him down, how can it appear to be a just form of procedure? At once, I say that I have had experience of adjudicators, and I can only tell your Lordships that I have found many of them just people, who have listened with great care and consideration to what is before them. But how does it appear to the applicant immigrant?

There is no point in repeating all the things that have been said about family life by the right reverend Prelate—and how right he was!—and by the noble Lord, Lord Avebury, with the examples he gave. You do not want from me when summing up a repetition of speeches that have been so adequately made by others. But I wonder whether, as a result of this debate, even at this late hour, and before this attenuated House, instead of it just being a reply by the noble Lord the Minister on what he has been told are the facts of the case, we have moved him enough for him to say to himself tonight, "The hour was late but I believe that there was so much sincerity in the debate that took place that I am going to have a word with my colleague about whether or not we can make this whole procedure not only seem to be more just but in fact to be more just, and accept at least some of the main recommendations of the report which we have been debating tonight".

My Lords, we are all indeed grateful to the noble Earl, Lord Listowel, for directing our attention to an area of considerable public importance. I am grateful to him also for acknowledging, as have others of your Lordships, the full co-operation of the Home Office once the locus of the commission had been established, as I believe it was reasonable to require it to be, before they began their inquiry.

We now have a debate which the noble Lord, Lord Mishcon, in a speech which contained both trenchant criticism and generous praise of my honourable friend the Minister in another place, said is vastly overdue. The fact that it is overdue of course lies not at the door of the Government but with those who could have put down Motions earlier. It cannot be said that the Government do not regard this report as a serious event.

The Commission for Racial Equality are dedicated to achieving fair treatment for all racial groups and good relations between them. Let me make it absolutely clear that the Government, too, are committed to those aims. I have been asked to give that commitment, and I give it gladly, but the Government believe that one essential prerequisite of good community relations is firm but fair immigration control. Particularly at this time of high unemployment, it could only be damaging to good community relations if it were thought that there was not that firm control and job opportunities were to be lost as a result of a substantial influx of newcomers.

The noble Lord, Lord Mishcon, himself pointed out the delicacy of the question of who is unemployed, and its relation to the question of the way different ethnic groups see each other. The control must, however, be seen to be fair; and how better can it be seen to be so than by our having rules approved by Parliament which state who is entitled to come and who is not, and by giving to the individual who feels that the rules have not been properly applied in his case an appeal to an independent appellate authority? I shall return to that. Of course there must be a residual discretion to deal with the exceptional case, but when people talk of fairness as often as not they are thinking of consistency, which means treating people in like circumstances in like manner.

The report accepts that a review of the law is beyond it; and it accepts that it is the implementation of the law that is its chief concern. It also states at paragraph 2.2 of chapter 2 that the investigation was not concerned with general Government policy on immigration control. Nonetheless, as a Member of Government, I find that my view of the matters under discussion has a small but important difference of perspective from that of the commission. I could illustrate that best by referring to the arguments set out in paragraphs 5.1 and 5.2 of chapter 2 of the report. Here the commission refer to the balance they feel should be struck between,

"the objectives of detecting and preventing evasion and abuse on the one hand and ensuring that genuine applicants and passengers meet the minimum delay and difficulty on the other".

The commission believe that we have that balance wrong.

Elsewhere, they dismiss the statistics we have produced, which illustrate the incidence of evasion, as misleading or skewed. They themselves, I might add, produce no statistics whatever on which to repose this conclusion, but the conclusion robustly expressed is that the balance struck has been wrong. The control is there as a means of allowing someone to establish his entitlement to come here under the rules. The control is not there just to sniff out abuse; but when somebody comes and claims an entitlement it has to be tested and a sensible balance struck between the need to detect evasion and the need to see that people get their entitlement.

Of course we want ease of access at our airports for those who are entitled to come here—and the evidence points to the fact that, in the main, we secure it. The statistics which leap to my eye first in that respect are these. British and EEC citizens go through immigration control, as we all know, at a very brisk pace indeed. The average time taken to clear each passenger from every other country in the world is exactly one minute. The scenes of congestion some of your Lordships have observed at Heathrow and other airports arise not from excessive administrative caution but from the habit of long-range jumbo jets to arrive in larger numbers during just four hours of the morning.

In that context, the throughput of immigration control is, in my view, remarkable and laudable. It is worth reminding your Lordships that the number of people arriving from, for instance, the Indian subcontinent who are then refused entry is very small indeed; barely more than 1 per cent. in the case of those from Bangladesh and Pakistan, and a mere 0.6 per cent. for those from India.

A less conspicuous but more important queue, as I believe all your Lordships have emphasised, is the queue for entry clearance on the sub-continent itself. It is not in doubt, I think, that some control should be exercised, as the Act provides, for people to enter and settle in this country. I acknowledge the frank and welcome recognition by the right reverend Prelate the Bishop of Birmingham of the quality of work and increased openness of the Home Office, and the effects of that work on the entry queues.

When they published their report the Commission for Racial Equality drew attention to their claim that one in five wives of black men settled in the United Kingdom were refused entry, as were two in five children. The immigration rules give dependants wide rights to join heads of households settled in this country, but those seeking to exercise those rights must establish their entitlement.

It has long been a requirement of immigration procedures that those who want to settle here must establish their entitlement by obtaining entry clearance at our post in the country from which they are coming. This helps to avoid difficulties for them at the ports of arrival. Under these provisions we have allowed a great many wives and children to come here for settlement. A total of about 16,800 wives and 12,700 children were accepted in 1983 alone. Over the past 10 years the United Kingdom has accepted more than one-third of a million wives and children for settlement. Over two-thirds of them were from the New Commonwealth and Pakistan. The figures noble Lords quoted need to be seen in that context.

Not all of those who apply, however, are eligible dependants. Many of those refused have tried to evade the rules, and have, indeed, admitted doing so. To suggest that the process of entry clearance can be accelerated without considerable expenditure of resources is to ignore the facts. To increase the number of village visit teams, as the report suggests, would in particular soak up a very great deal of effort, and other parts of the system would inevitably suffer by their removal.

Before I speak further about the recommendations in the report I shall try to pick up a number of points noble Lords have made. They came at me rather thicker and rather faster than usual, and what I have before me is not the orderly arrangement of material I like to provide for myself at this stage but something more like an indifferent hand at rummy. If your Lordships do not receive answers in the same order in which the questions were asked, I apologise. It is also absolutely certain that I shall not be able to answer every point, but I shall of course reply by correspondence to your Lordships' unanswered questions. I need hardly remind your Lordships that under the new convention those letters will be placed in the Library of the House so that all of your Lordships can see the material I have sent to the others.

The first card I draw refers to the noble Lord, Lord Hatch, who made a point about unlawful decisions which ought to be rectified. What the commission said was that some decisions were found to be incorrect in law as a result of judgments of the appellate authorities and the courts. This is very different from saying that the decisions were unlawful. Where applicants think that subsequent judgments affect their case they can reapply and that case is then reconsidered in the light of the new interpretation of the law.

The noble Viscount, Lord Buckmaster, is concerned with refugees. I share his concern, having myself been to the borders of Kampuchea shortly before I came into Government and seen the refugee camps there. Refugee applications inevitably often take an especially long time to decide. We are very conscious of the need to reach a decision as quickly as possible in the interests of the individual concerned but the circumstances are often generally confused because of the state of affairs from which the refugee is fleeing. It is not always a straightforward question, therefore, whether or not an applicant qualifies for refugee status. Often it is possible to do no more than to allow temporary leave to remain on an exceptional basis while the inquiries proceed. As regards appeal rights, someone who is refused leave to remain has a right of appeal; not, of course, as a refugee but the right is there as an entrant.

I draw the first card in the suit of the noble Lord, Lord Avebury, which deals with what happens to a case which is under inquiry, as it were, by a Member of either House of Parliament. When a Member of Parliament takes up an individual case removal action is suspended while the representations are given full consideration. But it is accepted, and I am not quite certain if the noble Lord touched on this or intended to, that only one Member of Parliament should take up any particular case at any one time. That will normally be the constituency Member of Parliament. Noble Lords will understand that the difficulty is that if you deal with one inquiry and it is disposed of and you are about to come to a conclusion, another one arises and the process can be repeated a number of times.

My Lords, the noble Lord has left out an important element in the procedure. Where the case is taken up by someone who is not a constituency Member and then subsequently the Minister discovers who the constituency Member is, he undertook in writing to notify the constituency Member and to give him the opportunity of making representations, notwithstanding the fact that some other Member either of another place or of your Lordships' House may already have been involved for some considerable time. That is the undertaking which the noble Lord should know his colleague in another place has broken.

My Lords, the noble Lord has made a serious allegation and I shall have to inquire into it. I cannot, of course, answer him immediately and off the cuff. It is not, I might say, in the character of my honourable friend to break undertakings but I accept that the noble Lord is sincere in what he puts forward and I sill attempt to give him a factual reply.

Both the noble Lord, Lord Avebury, and the right reverend Prelate were concerned about husbands and fiancés. The Government take the view that, particularly at a time of high unemployment, it is not realistic to provide for the admission of husbands and fiancés without additional tests. The immigration rules therefore provide that husbands and fiancés may not be admitted to the United Kingdom for settlement if the primary intention is to obtain admission to the United Kingdom.

In the Government's view it is right and necessary to prevent new immigration by men of working age through marriage. This is not a question of separating husband and wife. The refusal of admission means that the couple must live in the husband's country, but this applies only where the primary purpose of the marriage is immigration. I would say to the right reverend Prelate that in fact he often places the onus of proof on people who come to him for the right to marriage; and it is not entirely outwith the traditions of this country that when somebody seeks a benefit as of right they have to prove the right before the benefit is granted. The test can be passed, and in fact more husbands do pass it than fail. To say that the immigration laws keep asunder those whom God hath joined together ignores the fact that we are actually in that context talking of fiancés.

If I may go on to other difficult ground—that of elderly relatives—I do not think that, attractive and compassionate as the appeal is that the right reverend Prelate made, we can be expected to take parents, or indeed other more distant relatives, simply because they would prefer to live here. Their children have, after all, chosen to leave their parents. We are ready to accept other relatives where there is a strong case on humanitarian grounds; and I gladly recognise the acknowledgement of my right honourable friend's compassionate nature to which the noble Lord, Lord Mishcon, was kind enough to refer.

The noble Earl, Lord Listowel, and the noble Lord, Lord Avebury, were concerned with joint immigration service and police operations. Following a comprehensive review of the arrangements for joint operations by the immigration service and the police against over-stayers and illegal entrants, new instructions were issued to chief officers of police on 12th December 1980. Among other things, they drew attention to the delicate task faced by those seeking to enforce the immigration laws and the care which is needed to avoid any action likely to cause justifiable complaint. They specified that before an operation takes place every effort shall be made to identify those who are suspected of committing immigration offences in order to minimise the risk of arresting innocent people. They also made clear that where people were questioned and could be eliminated from suspicion immediately, they should be subjected to no further inconvenience. Where it was necessary for a person to be taken to a police station, all the inquiries should be conducted as a matter of urgency to reduce to a minimum any period of detention.

Since the review, only 10 joint operations have been conducted, as a result of which 153 people have been interviewed; and I should tell your Lordships that of those 130 have been found to be here in breach of the immigration laws. Only two joint operations were carried out in 1983, involving interviews with 44 people in all. In 1984 only one major operation was conducted, involving interviews with 10 people, of whom, I might add, nine were found to be in breach of the immigration laws. It does appear to me from that that the power has not been indiscriminately used over recent years.

The noble Lord, Lord Avebury, said that the effect of the rules was to delay the arrival of applicants by up to eight years and so, he added cogently, to delay the process of integration as well. This applies, I take it, to special voucher applicants in India only. A special voucher encompasses the whole family, and it is therefore at least worth noting in passing that it does not involve the division of families, which is a matter, I entirely accept, of very great concern.

I may be repeating myself when I say that the Government note the comments which the commission makes about the test which should be applied to the admission of elderly parents and children. So far as the former are concerned, the report notes that the High Court has laid down generous provisions. These have been conveyed to the entry clearance officers and arrangements have been made to ensure that delays do not occur again. So far as children are concerned, the basic principle is that children should be allowed to come to this country to join the family unit.

The sole responsibility test is intended to cover the case where parental responsibility is divided and entry cannot be justified to establish family unity. But there is flexibility in applying the sole responsibility test. However, I can tell the right reverend Prelate and others that we shall be looking carefully at what the commission has to say on both elderly parents and children.

As I say, the Government do believe it necessary to maintain a firm immigration policy. This means that the rules must be strict, even where elderly parents are concerned. Without notice, I cannot comment on the case which the noble Lord, Lord Avebury, mentioned, although he was kind enough to give me the reference number. But paragraph 52 of the Immigration Rules gives generous provision for this. I think I have said enough as I do not wish to be drawn into individual cases.

The noble Earl, Lord Listowel, suggested the involvement of the Lord Chancellor. This recommendation will be given careful consideration. But the provision of three adjudicators instead of one does not seem to us practicable, as it would either increase threefold the cost of the appeals system as more adjudicators would be needed—not exactly pro rata, but it would greatly increase the cost—or it would triple the delays as fewer hearings could be heard by the same number of adjudicators. We are not convinced by the argument that, because decisions often turn on complex matters, it would be more appropriate for appeals to be heard in the first instance by a board of three adjudicators.

I return to the point, though I shall dart out of it again. I apologise for the length of my reply but always on these occasions I feel that the curiosity of your Lordships is greater than the impatience of those who try to regulate the length of time which I stand at this Box. A central passage of the report is devoted to a premise upon which the commission rests it case. The noble Lord, Lord Hatch, has declared himself particularly interested. It is devoted to the Government's perception of the motivation for immigration and the inference that we draw from it.

The commission accepts that there can be a variety of reasons for migration. The economic standards, the political régime or the social custom as between two countries can all, either separately or together, give numbers of people a sufficient reason to move from one to the other. We are not unique in this. Many other developed countries are the objectives of countless third world would-be settlers, just as many other Western countries are the chosen haven of many would-be emigrés from the Eastern bloc. However, our chief concern is with the countries which generate the greatest flow to Britain.

We have come to call the combination of differences between those countries and our own, which give rise to that flow, "the pressure to emigrate". This is not a constant factor: it fluctuates. For instance, your Lordships will remember the surge of Cypriot immigration following the invasion of Cyprus by Turkey. I expect your Lordships will also be aware of the recent very considerable reduction of immigration from the West Indies.

Pressure to emigrate does fluctuate; but it is real, and it cannot be discounted. It can make a move into this country a compellingly attractive prospect; and it seems to us to be logical, with a logic based on experience, to expect the greatest efforts to make that move to come from people living in places where the pressure is greatest—for instance, in Bangladesh or Ghana. It further seems to us to be absolutely common sense to expect the most determined and numerous efforts to immigrate illegally to be made by those subject to the greatest pressure.

It must be right that the proper, logical way to deploy our efforts to prevent unlawful immigration is to exert ourselves most where the risk of such illegal immigration appears to us greatest. It is in those simple and to me obvious logical steps that the commission has been unable to follow us. This, in turn, has led them to regard our deployment of effort not as a proper and impartial response to the pressure of numbers, but as an improper and potentially racist response to quite other considerations.

The Home Office case did not rest simply on the statement of the obvious that I have just paraphrased. It was illustrated by statistics, for example, which showed the differential rates of refusal of leave to enter the United Kingdom. Of course it would be very surprising if refusal rates were identical for all parts of the world. What is in issue is the interpretation to be placed on the variations. It is our contention that the different rates reflect different pressures from different places. In 1983 the refusal rate happened to be highest in respect of Ghana; 3.2 per cent. of passengers from Ghana were refused leave to enter in that year. It is worth remembering, in passing, that that figure means that the huge majority, nearly 97 in every 100 passengers from Ghana, was admitted. Nevertheless, the rate is higher than that from other countries.

What is the proper interpretation of the fact that evasion is not evenly distributed? That there is evasion of immigration control is not, after all, in dispute, certainly not with the commission. Passengers do arrive making fraudulent claims to be visitors. People do present forged or altered documents. Those who obtain admission, for example, as visitors or students, stay on unlawfully and so on. Sometimes there are organised attempts to evade control. Last year, for example, one organised attempt—by Ghanaians, as it happened—was uncovered to use marriage for immigration purposes. Twenty-five people have been found guilty, not by Government but by the courts, let me emphasise, of offences under the Immigration Act and the Marriage Act, and of perjury and conspiracy. The right reverend Prelate will sympathise with us in this discovery, but it lends a certain reality to the need for the inquiry.

I grant that cases of evasion, whether individual or multiple, do not prove that the pressure to immigrate is greatest from the countries that feature most. But the pattern is consistent. Thus, the highest number of notices of intention to deport served for overstaying in 1983 concerned people from Ghana. So the Government's contention is that it is common sense that the pressure to come here is greater from some places than others. This leads to attempts to evade the control, and this is reflected in the pattern of statistics. The great majority of people who come here do so lawfully. But the differential pattern affecting the small minority reflects attempts to come here outside the rules, and it does not reflect bias in the system. It really is not very helpful to race relations to suggest that the Government are somehow using the statistics to pursue a covert racist policy.

The broad brush reply of the commission to those statistics was that the figures from high-pressure-to- emigrate countries were, of course, higher than those from low pressure because it was against just those countries that we deployed our greatest protective effort. In effect, they said, "your proposition is unproven because we are finding most attempted evasions exactly where you are making the greatest effort to find them". They then assume that an equal volume of attempted evasion may exist around the world and in countries where there is far less pressure to migrate. They offer no statistical support for this, and their conclusion therefore rests on somewhat flimsy logic. It is contrary to the clear and entirely probable perceptions we have gained in the field. Yet it has been taken by the commission as the premise upon which much of the rest of the report is founded. That means that we have to examine its recommendations with very great care indeed.

I cannot say that the result will be that we readily accept the great bulk of these proposals. There are 70 in all, although the report itself acknowledges that 14 of them go beyond the terms of reference. Of the 56 strictly relevant recommendations, a number relate to matters of detail. Of the matters of substance, we can accept some. Proposal 23, that entry clearance officers should take what are termed split decisions when it becomes clear that some members of a group are genuinely members of one family and others are not, is one that we have accepted and implemented. Entry clearance officers have also been instructed, following Recommendation No. 24, that where applicants have a prima facie claim to a certificate of entitlement they shall be told of it and asked whether they wish to be considered for one. We have also, for a variety of reasons, as Recommendation No. 3 suggests, discontinued the practice of making checks on past tax records. Moreover, entry clearance interviewers now place, as Recommendation No. 8 proposes they should, a greater emphasis on family relationships.

The remaining matter on which we are in agreement with the commission is probably more important than these, however. We do accept that, as is suggested in Recommendation No. 54, training given to the staff of the service should be kept under continuous review. That we seek to do at present. We are more than content to take into account suggestions put forward by the commission in this important area and the strictures that several of your Lordships have made. In the same vein, I should add that we are reviewing our staff instructions. A number of bodies here made the comment which the right reverend Prelate made, namely, that the instructions should be published. We shall consider this in the light of our review.

I think I really must discard the attractive prospect of answering many more of the points your Lordships have made. I have shown that there are some things which we can accept. What I cannot undertake to do is to remove our perception that there is a greater pressure to emigrate here from some places than from others. This is bound to affect the way the on-entry control works, and it is of course control on or before entry which has attracted the commission's chief criticism. I ask your Lordships to consider the implication of relaxing our on-entry control. It must be an increase in the effectiveness of post-entry control.

We have the good fortune to be an island, and it seems to us that we should profit from that and not have the sort of internal supervision by the police and immigration authorities which is prevalent in other countries where you have to carry identity cards and piece d'identité in order to prove your right to be in the country at all. The report expresses anxieties about the level of post-entry control itself, and I have given your Lordships the figures for the 10 IND exercises in which your Lordships are interested. The point is that if you do not have effective on-entry control you must have effective post-entry control.

The last word I want to say is in my view the most important. I ask your Lordships, in your anxiety to change the Government's perceptions, not continually to reinforce the view that our policies are based on racist intentions. The Home Office is actually in the business of trying to improve inter-community relations in every respect, including the difficult one of policing. If it becomes a sort of watchword round this House or another place that these are racist considerations it does nothing but harm to that effort, and we all share the need for it to succeed. Therefore, I ask your Lordships to consider carefully what I have said about the reasons for the decisions we have taken. I shall write to your Lordships about everything else.