With this we are to take the following amendments: No. 3, in page 1, line 10, leave out 'July 1979' and insert 'October 1978'.
No. 5, in page 1, line 10, leave out 'July 1979' and insert 'December 1978'.
No. 11, in Title, line 2, leave out 'July 1979' and insert December 1978'.
On a point of order, Sir Myer. You will have seen the paper headed "Provisional selection of amendments". It does not deal with the new clauses, of which there are four on the Notice Paper. May we take it that the Chairman has selected all the new clauses for debate, or have they not been selected for debate?
The hon. Gentleman has seen the provisional selection. The new clauses have not disappeared from the face of the paper.
It may save many points of order if I point out that the scope of the Bill is very narrow. It has one purpose and one purpose only—to extend the duration of section 10 of the Counter-Inflation Act, which would otherwise expire. It has no effect whatever on the substance of section 10. Any amendment which would have such an effect is outside the scope of the Bill. The great majority of the amendments which have not been selected are out of order on that ground.
I am moving amendment no. 4 in the names of my right hon. Friend the Leader of the Liberal Party and others of my hon. Friends. Amendment no. 11 is associated with it as a consequential amendment.
During the Second Reading debate, it was accepted by both sides of the House that the Government's policy has a discrepancy, for better or worse—the House has just decided for better by a majority. That discrepancy is between a voluntary policy on pay, supported by certain sanctions, and a statutory policy on dividends.
One of the themes of the debate which occupied both sides of the House to a considerable extent was that the maintenance of this precarious pay policy depends on trying to establish a national consensus. The amendment is a contribution towards such a consensus. It is an attempt to bridge somewhat the gap between statutory provision on dividends and voluntary provision on pay by moderating the period of the statute. The amendment would secure that the provisions of the statute would last only for five months instead of the 12 provided for in the Bill.
To the Liberals and, I hope, others in the House, particularly those who joined us in opposing the Bill, one of the most objectionable features of the discrepancy is that the statute, if passed unamended, would be in force for a full 12 months whilst the voluntary pay policy can he abandoned by the Government at any moment—indeed, might have to be abandoned at any moment—or might cease to work so that it was as good as abandoned.
It would, in our submission, be entirely unfair—and I expect hon. Members opposite to accept this, especially from the point of view of pension funds, occupational and otherwise—if, when a voluntary pay policy has ceased to operate for one reason or another, possibly as a result of an election or a new combination of parties in Government, the recipients of dividends, such as pension funds and the rest, were to be tied for 12 months to an extremely restrictive law.
Therefore, the amendment provides that after five months' operation, which we submit is, broadly speaking, about the right period, at the end of the calendar year the provisions of the Bill should expire, and it would then, of course, be open to the House, perhaps in a new Parliament—who knows who might be in control of it, jointly or severally—to consider whether to re-enact the statute, make certain alterations, or let the provision drop altogether.
It seems to us that if it is the avowed object of the Government to secure a mood of consensus in the country in these matters, they should see the fairness of providing for a review at Christmas time of the operation of the statute, particularly as to those on small retirement incomes and to those who have the solemn obligation of doing their best for pension funds every month matters and every dividend matters. In these times every jot of income matters to such people in their later years.
For these reasons we ask the House to endorse the proposition in all fairness that after five months this policy should be reviewed, and then the House would be free as to the course of action it should take. On these grounds, I commend the amendment to the Committee.
I am happy to contribute to the debate so ably opened by the hon. Member for Colne Valley (Mr. Wainwright). My amendment no. 3 would bring the Bill to an end by the end of October, a couple of months earlier than the Liberal amendment suggests as an appropriate time. I do not want to quarrel with him about the precise details, because I am so pleased to see him with us and that we are at one, both on the principle of the Bill and on the principle of the amendment. He is jumping the gun. I thought that the Lib-Lab pact did not run out until the end of July. But it is only 27th July today and grouse shooting does not start until 12th August.
I would not in the least single out the hon. Gentleman for correction, but it is a common false assumption that the Lib-Lab pact in any way bound us to support any individual measure of the Government, or bound the Government to support any Liberal policy. It was related solely to votes of confidence in the House, and this is not one.
I always thought that the Lib-Lab pact was much more flexible than the prices and incomes policy. That, I think, proves the point.
I am delighted also to see that the right hon. Gentleman the Chancellor of the Duchy of Lancaster is here with us. He is always welcome to join in our debates. I am sure that he has been going round the City—and around the small businesses—telling people that he does not believe in dividend control, that he believes in lower taxes, and that he does not believe in capital transfer tax. Where was be, I wonder, at 10 p.m.? Did he vote? In which Lobby was he?
I know perfectly well that the right hon. Gentleman is the front man to try to appease the City. He will tell the City that he thought that the hon. Member for Cirencester and Tewkesbury had a good point in his amendment relating to the end of October 1978. He will say that he agreed with the hon. Member for Cirencester and Tewkesbury but that, of course, the Whips made him vote against the amendment.
The hon. Gentleman is curious about my whereabouts. If he will look at Hansard tomorrow he will discover my whereabouts. But I cannot so readily discover the hon. Gentleman's whereabouts when the Conservative Government brought in dividend limitation in the first place. As the hon. Gentleman was a member at one time of that Government, will he say whether he approved of dividend limitation, or whether he thought at the time that it was ridiculous nonsense?
I am delighted to deal with the right hon. Gentleman's question, because when the Counter-Inflation Bill was in Committee I moved an amendment to limit its life to one year. I was supported by the right hon. Gentleman the Chief Secretary, and the right hon. Gentleman the present Secretary of State for Energy. The right hon. Gentleman the Chancellor of the Duchy was not on the Committee. He does not do a lot of Committee work. We understand. He is not very good at Committee work. But we carried the amendment against the Conservative Government. Then we came back to the House on Report, and the right hon. Gentleman supported me on limiting the duration of the powers. But now the right hon. Gentleman is not supporting me on limiting the duration of the powers. The right hon. Gentleman has turned coat. [Interruption.] I have an apology to make, Sir Myer—
I wish to apologise to the Committee, Sir Myer, for provoking the right hon. Gentleman the Chancellor of the Duchy, who has now gone away. I quite understand that what I said to him and about him thoroughly riled and nettled him. I withdraw any imputation upon his honour, but I do not withdraw any imputation upon his conduct. What I said was perfectly justified. The fact that the right hon. Gentleman left the Chamber in high dudgeon proves what I was seeking to establish.
I should like to go into the events of 1973 at great length. I should like to talk at great length about how right hon. and hon. Members on the Labour Benches combined with me and my hon. Friend the Member for Oswestry (Mr. Biffen) to truncate the Bill. I am sorry that hon. Members do not want to talk about those events. I do not think that that is what we should be talking about now and I am sure that you, Sir Myer, as an excellent Chairman, whom we all admire and revere, would rule me out of order if I were to try to go into those events at any great length.
My hon. Friend was not present. There was this occasion in Committee when the duration of those powers was proposed to be limited to a one-year period, with a further order power to extend them for another 12 months. I moved the amendment and was gratified on that occasion to have the support of the entire Labour Party, which was voting to end those powers which it now seeks to renew in this Bill.
Although it is possible to say to my right hon. and hon. Friends that they have vacillated over this issue, it is not possible to say that about me and it is certainly not possible for Labour Members to say that, because they were the people who vacillated most. That is the only point I wish to establish. I do not want to blame anyone or apportion any blame. I merely want to clear that point out of the way so that I may start my speech on this group of amendments.
We were told a week or two ago that Parliament was likely to rise on 2nd August. Why was it that this Bill was planned for tonight when the House was due to rise in three days' time? Why was it not brought forward earlier? It has all the appearance of a rushed job. It is not usual to take a Committee stage immediately after Second Reading. Presumably, Report stage will follow Committee stage with Third Reading thereafter. This is not how to legislate.
If we had wished to pass this Bill, we could have entered upon it in May or June and taken the Committee stage upstairs in the normal way. Then the Bill would have come through and received the Royal Assent before the end of the Session. If on the other hand, the Government have changed their mind in the past few days, I suppose that they have the right to try to force the Bill through. But why make it last so long that we cannot return to the subject after October?
We have been told that the House will be recalled on 24th October. If the Government so wished and we still had a Labour Government, they could introduce a Bill in October with considered proposals for the control of dividends. They could introduce a Bill on 24th October which could be debated in detail on Second Reading.
The hon. Member for Birmingham, Selly Oak (Mr. Litterick) made a speech that was highly critical of the Bill. Although it was a slightly unnatural alliance, some of my hon. Friends and I found ourselves in sympathy with the points that he made. It would be nice to explore those points in Committee, spending a few weeks going over that ground with the hon. Gentleman. We could try to explore the deficiencies in the system of dividend control which the Government are proposing. If we are to do that, it would be wise to start the Bill again in October. There would be plenty of time to get the Bill before the end of October. We would go into the minutiae.
The trouble with this Bill is that it does not tell us the means of dividend control. It does not say what the Treasury order or the Treasury regulations will be. It does not say who will administer the control and whether there will be a system of appeals against a refusal of a dividend increase. It does not say anything at all about the details of control. These matters are important, because if we do not have a properly defined system for dividend increases, a system of appeals, and possibly recourse to the courts, we are not doing our duty as legislators. The Bill should contain provisions for all these things.
We should not give Ministers blanket powers, especially as we are about to go into recess. In the next three months Ministers will be able to allow one dividend through and stop another at whim. I suppose that Canning Town Glass Ltd. will be allowed to increase its dividends as much as it likes, as will the Hodge group of bankers. But companies like Pirelli will not be able to do so. I expect Labour Party Properties will be able to increase its dividends by 100 per cent., and there is nothing that we can do to stop it.
Has my hon. Friend noticed that although this Bill and the amendment relate very specifically to the problems of small businesses, the Minister responsible for small businesses is not in his place? His superior officer having departed, the Committee cannot hear a statement from either of them in reply to my hon. Friend's points.
Interest in small business on the Labour side is skin deep. Come the General Election, the Chancellor of the Duchy of Lancaster, and the Minister responsible for small businesses, the hon. Member for Keighley (Mr. Cryer) will be swept away. They will have served their purpose. That purpose is to convinu the electorate that there is some interest in small businesses in the Labour Party, which there positively is not. Does any hon. Member want to challenge that? The hon. Member for Liverpool, Walton (Mr. Heller) sits there like a stranded whale—
I thought that we were in Committee on the Bill, and that a Committee stage should be taken seriously. May I seek your protection, Sir Myer? Surely we should discuss the issues involved thoroughly, and take our time to make sure we get them right.
The Bill gives the Treasury the power to make regulations to control dividends. Will they be different from the existing regulations? There is this provision in the Bill about dividend cover which needs spelling out in an order or in regulations. We are not allowed to debate the power of Ministers, and we have no power to scrutinise regulations—
Order. I have allowed the hon. Member for Cirencester and Tewkesbury quite a bit of latitude. We began the debate with a point of order from the hon. Member for Eastbourne (Mr. Gow), on which I pointed out that this is a narrow debate, dealing only with the extension of the duration of section 10 of the Counter-Inflation Act. We are not discussing the Act; we are debating only the extension of the period.
But if we are to discuss when the Act shall cease, it is highly relevant to discuss when the regulations are to be made and by what means. We shall adjourn next Thursday, so how are we to know what the regulations will be?
I do not want to discuss amendment no. 7, which deals with the order-making power, because it has not been selected, but if we are not to be able to debate the regulations for detailed control of dividend increases, the power of the Act should not extend beyond the end a October.
Does not my hon. Friend agree that alongside those serious misgivings about the duration of the Bill, although he said that the criterion for dividend cover was in the Bill, he meant that the situation was even worse than he described, because the dividend cover criterion is not in the Bill but is part of a Treasury document to be issued arbitrarily later without sufficient explanation and establishing yet another arbitrary criterion for rule by Government decree and fiat wholly outside the legislation?
That is just the point. If we are to give the Government power to make regulations that will not be open to scrutiny by the House, including this new criterion, the least we can do is to return to the subject early in order to make clear what the rules are for those who may wish to raise their dividends and want to know whether they may do so. It is intolerable to give power to the Treasury to make regulations which will last for one year without our being able to scrutinise the regulations to make sure that they are fair.
The hon. Gentleman will know that the Bill does not say anything about regulations and that the power sought in the Bill will enable the Treasury to use the existing dividends order which arose from the 1973 legislation, which the hon. Gentleman supported.
The Minister of State has not done his homework. The White Paper refers to a change in the basis and to this new criterion about dividend cover. Must we just accept the paragraph in the White Paper which says:
The Government intends to introduce a Bill to extend the statutory control for a further 12 months from 1 August 1978 on the present basis and with the present provisions for exceptions and with one addition. This is that from 1 August 1978 no company will he required by the controls to increase its dividend cover above the highest level achieved since the current controls began.
That is not in the present regulations. Will it be put in new regulations? The Minister of State has just made a revelation to us. He said that there will not be new regulations. The new condition in the White Paper will presumably not be promulgated in regulations and we shall therefore have to rely on the vague words of the White Paper.
The hon. Gentleman misunderstood me. The Bill that he supported in 1973 enabled a dividend order to be laid and such an order was laid as statutory instrument no. 659/73. The powers to make these rules regarding dividends arise under that order, and that applies to the regulations about cover to which he is referring.
That will not do. The right hon. Gentleman says that the existing regulations are adequate and that he has the power under the Act to keep the regulations in force. However, we read in the White Paper that he is to change the criterion in accordance with the dividend cover condition. That may or may not be acceptable, although it is a welcome relief. However, we want to know what it means. It should be spelt out in a regulation. Will the right hon. Gentleman publish new regulations to spell out in detail what is meant so that companies that might be considering taking advantage of the condition know exactly where they stand?
The right hon. Gentleman says that we can live on the existing regulations. However, those regulations do not contain the condition. I ask him again: are we to have new regulations? It is no good the Minister of State talking to the Patronage Secretary. The Patronage Secretary is not welcome here at this moment. I ask him to stop interfering with the Minister of State, who is supposed to be answering a question that he cannot answer.
I draw my hon. Friend's attention to the article that appeared in The Times on Monday headed:
Treasury's dividend control plans tighter than expected by the City.
Treasury clarification of the Chancellor's dividend control proposals has revealed they are tighter than was originally thought by the City.
It seems that the City is confused, which cannot be good. Secondly, it is obvious that some proposals are coming forward.
I was beginning to think that in the Committee's present mood we were better off without clocks. If they are out of order, we shall not get alarmed about the time that is passing. I understand that the matter was referred to by Mr. Speaker, who announced that nothing could be done about the clocks during the sitting of the House of Commons. There is a clock in front of me and we shall get a calendar if we need it.
Further to my point of order, Sir Myer. Is this a further example of industrial action in the House of Commons? Does not the non-functioning of the clocks make it extremely difficult for my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) to develop his argument properly, he being unable to see the time ahead of him and, therefore, unable to know how the course of the debate is running? Would not it be sensible for the Committee to adjourn for a short while so that the clocks may be put in order?
Let us be serious. It is almost 10 minutes to 11 o'clock on Thursday evening. I am sure that it is helpful to the hon. Member for Cirencester and Tewkesbury if there are no clocks before him. Their absence will help the hon. Gentleman to concentrate on the subject.
I welcome the fact that the clocks are not working, because I am caused no feeling of guilty conscience about the sleepers to the north of the country and to Scotland. I do not remember precisely when the sleepers leave, but if I cannot see the clock there is no way in which I may know whether I am in any way inconveniencing hon. Members, and that would be the last thing that I should wish to do.
I make a serious point about paragraph 30. The Minister of State has said that there will be no new regulations although he has put a new criterion in the White Paper. Parliament will soon go into recess and will not be sitting for three months. How are companies that come to declare dividends in the next three months to know the nature of the rules? We cannot ask questions and we cannot have debates while we are not sitting. It seems that the right hon. Gentleman owes it to the Committee to spell out in detail what the new criterion will mean so that companies may know exactly what they may do and how they may go about increasing their dividends if they so wish.
The suggestion that the Minister will rely upon the existing regulations, although he is bringing in new conditions, is totally unacceptable. That is another reason why the whole procedure on the Bill is unacceptable. A Committee stage is to have points such as this clarified. The fact that we have to come to it immediately after Second Reading, as you so rightly said, Sir Myer, late on a Thursday night, when I am sure you are tired and wishing that you were—
Order. I have no wish to hold up the hon. Gentleman's contribution, but I am certainly not tired. If necessary, we shall go on till 5 or 6 o'clock in the morning. I am not going back to Scotland tonight.
Order. All I ask the hon. Gentleman is to remember that the Committee stage is to deal with amendments that have been submitted and selected and to speak to them.
The hon. Gentleman may not be tired, but I am concerned to hear that many of his hon. Friends are. I understand that many of them have gone home to bed. [HON. MEMBERS: "No"] His hon. Friends are denying it. Plainly, there is a dispute on this matter. The hon. Gentleman feels strongly about this amendment. Therefore, will he undertake to press it to a Division? It is important that it should be pressed to a Division. We shall then be able to see from the Division List how many of his right hon. and hon. Friends feel strongly enough about the amendment not to have gone to bed.
The hon. Gentleman was elected to come here to discharge a serious duty: to make sure that the legislation that he helps to pass is clear and precise and is available to his constituents so that they may know what the law is. The Committee stage of a Bill—I am sorry to give him this lecture, but he apparently does not know the procedure of the House of Commons—is to determine the precise meaning of legislation and to amend it in such a way as to make it clear to all so that they may obey it. If the hon. Gentleman is bored and tired and is not interested, he is not serving his constituents at all well.
I believe that the Bill is in such a mess and will cause so much confusion that we should end its duration at the end of October and come back to the subject with a new Bill. The Liberal Party thinks that we could let this measure run till Christmas and come back to it then.
The difficulty about the dates argument is who will be sitting on the Treasury Bench either in October or at Christmas. The Minister of State looks terribly unhappy on the Treasury Bench. He has never seemed to sit there very well. Indeed, he has been abandoned by his right hon. and hon. Friends. I can only tell him that my hon. Friend the Member for Blaby (Mr. Lawson), my hon. and learned Friend the Member for Dover and Deal (Mr. Rees) and my hon. Friend the Member for Horncastle (Mr. Tapsell) do not sit easily on the Opposition Front Bench. If my hon. Friends and the hon. Gentleman were the other way round, we might be able to deal more simply with this matter. I do not think that my hon. Friends would have a Bill of this kind. That would clear up the anomaly altogether. I think that we should review the position as soon as we have decided who is going to sit on which Bench. That is why I put down the amendment to which you, Sir Myer, have kindly allowed me to speak.
I thought—maybe ignorantly and wrongly—that by the end of October we should know where we should sit in this Chamber. I am confident that we shall be sitting on the Government Benches. That would change the whole picture. Our whole attitude to the Bill would be changed in that event.
The point is—there is the Chief Secretary now—that it would be much better to come back to this question after we have decided who is to govern the country. If by any chance there is not to be a contest in the autumn, the Government are beholden to come back with precise proposals, properly clarified in a schedule, with powers which we can amend in Committee, carefully set out so that everybody knows what they are so that there is a proper and accurate instruction to companies and so that we can go through them and amend them.
It seems to me that that is the right way for us to proceed, and for this dying Government, in their dying days, at the end of July, to try to get through in one night this iniquitous little cosmetic Bill is one of the biggest assaults upon the rule of law and upon the trust of the people, and it is a practice which should never be repeated by people who should never be allowed to legislate again.
I support the amendment moved by the hon. Member for Colne Valley (Mr. Wainwright), just as I would support any amendment which was moved endeavouring to cut short or truncate in any way the tragic obtuseness of the measure to which the House has given a Second Reading tonight.—[HON. MEMBERS: "Reading"] I am reading nothing. I am looking at the new amendment handed in and marked with an asterisk.
Bleeding hearts are something that the hon. Member for Birmingham, Selly Oak (Mr. Litterick) and I have shared in common, and I shall say nothing more about them.
I am devoting my attention to the necessity which this country is under of encouraging investment in industry. When I ventured to intervene earlier this evening in the speech of my hon. Friend the Member for Blaby (Mr. Lawson) during the Second Reading debate it was to point out that other countries, much more successful than we at the moment in our industrial, commercial and financial policies, are adopting very different policies from these.
Here we are, landed by this Government, as my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) said, in their dying days, in the eleventh hour probably of their ultimate Session, with a Bill designed to be pushed through the House in one night to extend dividend limitation. Why? It is not because it is desirable in the interests of the economy of the country—it is utterly and completely undesirable in the interests of the economy—but so that the Government may say to the unions when they are trying to get support for a pay policy "Ah, but we have limited dividends as well". What a negation of all the qualities of leadership that one ought to expect in a Government who ought at least to have the nous and the ability to be able to explain that the raising of dividends within the limits of the capacity of the profitability of companies—
I hesitate to join issue with the Chair, Sir Myer, but, with respect, the point that I am desiring to make is that the Bill is undesirable, and therefore the shorter its duration, the better. In my submission, it is in order to expound the reasons why the Bill should have no longer an existence than is absolutely necessary, even in the view of this Government, and in my view, because I voted against it tonight, it is undesirable anyway.
The House is gratified that the debate has ceased to be an exercise in irresponsible frivolity, which it was until a few minutes ago. Does the hon. and learned Gentleman agree that if the Bill is enacted the constraint on dividends will be just as ineffective as before the Bill was introduced?
I do not accept that it has been ineffective but it has been haphazard and unjust It has fallen wrongly on the wrong companies and piled up profits so that some companies have not been able to pay out their money. It has been haphazard and inefficient.
I say that the measure should last as short a time as possible because it is inimical to the industrial and commercial well-being of the country. At the time when the Government of the French Republic are encouraging investment in the ordinary shares of industrial and commercial companies by giving tax relief on the first 5,000 francs of income that any citizen of the Republic who is paying taxes invests in industrial or commercial companies, we are doing the reverse by discouraging investment. It is time that we looked at our neighbours in the European Community and elsewhere and learned from them the stupidities and tragic inhibitions which we put upon industry.
I cannot say whether I voted for it, against it, or abstained. Times change. Since 1974 we have seen this country go down hill, unemployment increase from 800,000 to 1,800,000 and the worst inflation we have ever known. Why? Because industry is being penalised.
I hesitate to take issue with the Chairman but, with respect, the limitation of time on the Bill goes to its root. I suggest that the Bill is bad. I am entitled to explain why I think it is bad and, therefore, why—
With respect, Sir Myer, the amendment limits the Bill, not until Christmas as my hon. Friend the Member for Cirencester and Tewkesbury said, but to Hogmanay. I would agree even more with my hon. Friend's amendment to limit the Bill to October when I hope we shall substitute a better Government. Whether it be to Christmas or Hogmanay, when some of our Scottish friends will have gone north to enjoy the pleasures of that season—
I cannot speak for my Scottish colleagues but I can say that I see on the Government side of the Committee fewer than half the number of hon. Members who are sitting on this side.
I support the amendment of the hon. Member for Colne Valley, as I would have supported the amendment of my hon. Friend the Member for Cirencester and Tewkesbury, in that it would limit the duration of dividend control. I support it because dividend control is thoroughly bad. It is inimical to savings, to industrial progress and to the commercial and industrial well-being of the country.
That has been recognised by countries that are currently eminently more successful than we are in meeting the prob- lems that face the whole of the western world. I would have hoped that the Government would draw a lesson from that fact and not persist with this Bill tonight, or, if they persist, do so only for a limited period such as is advocated by the hon. Member for Colne Valley. The limitation he proposes would have no effect on the nation's economy in the sense that the amount involved would be minimal compared with the amount paid out in wages and salaries. The Bill will have a vastly inimical effect in discouraging investment, saving, thrift and enterprise.
I support the amendment for a specific and technical reason relating to impending changes in accounting treatment that will affect the treatment and payment of dividends under the regulations that the Minister has already described.
My hon. and learned Friend the Member for Solihull (Mr. Grieve) has already talked about some of the technical defects that have arisen under divided limitation. He referred to the artificial devices—the problems of having artificially to raise capital in order to secure freedom from dividend restraint. He said that weak companies are being forced to pay a 10 per cent. increase year after year, because if that increase is not paid the ground lost cannot be made up in subsequent years. He referred to the way in which good companies have ben held back and have been unable to pay a proper reward to their shareholders. All that seems to provide a praiseworthy reason for supporting the amendment and ensuring that dividend limitation is ended as soon as possible.
There is an additional point which concerns the implementation of the accounting standards profession exposure draft 19 which relates to the subject of deferred taxation. It is important, because until now companies have had to set aside deferred taxation at the rate of 52 per cent., even where the taxation is likely never to have to be paid. Under the requirement of exposure draft 19, that will no longer be the case. Directors will no longer be required to put into a deferred taxation account such taxation as may not be expected to be paid within some reasonable period in the future.
That means that hereafter companies will show a highly variable rate of corporation tax in their accounts. Under the regulations that I understand will be made, and I refer here to the Financial Times article about the Government's plans for dividend control, there will be a considerable change in the method and manner of calculating dividend cover.
The regulations contained in exposure draft 19 will come into effect at the end of this year. It will then be mandatory for United Kingdom companies to carry into effect the recommendations of the accounting profession. As a result, from 1st January next no United Kingdom companies will any longer be required to set aside deferred tax, but will be allowed to flow it through into profits. As such, their dividend cover will be radically altered.
This is a most important point, which I am sure the Minister of State has taken. As I understand it, what the Government propose is that the calculation of cover shall be on what is described as "consistent accounting bases", which presumably would not be on the basis which my hon. Friend has suggested, which would be to change from one system to another. If that is so, despite what the Government are arguing, the fact is that companies would be increasing their dividend cover. Even at this late hour of the night, I hope that the Financial Secretary will make quite sure that his officials have got the answer right and that he will tell the House what it is.
I am extremely grateful to my hon. Friend. It is a matter to which I was going to come, because it has arisen in the financial press several times in the past week. Quite apart from every other aspect of the inimical effects of dividend restraint, the conditions of uncertainty that are prevailing as a result of this particular approach seem to me to make the results doubly undesirable.
Is my hon. Friend saying to the Committee that he thinks that if this Bill is passed without the amendments, we may be in breach of some obligation, real or imaginary, imposed upon us by Commissioner Jenkins and by Viscount Davignon?
I do not think that it will be anything to do with them. It will be to do with the charered accountants' profession within the United Kingdom. None the less, the point made previously still stands. This is a United Kingdom requirement rather than an EEC requirement, and one that will have far-reaching effects. As my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) pointed out, we do not yet know in detail the Government's thinking on this point. Next year a United Kingdom company, having a highly variable rate of corporation tax—and a rate that can vary from half-year to half-year—will be able, because of the requirement of exposure draft 19, to have a variable amount of dividend paid because of the restrictions contained in the calculation of cover.
I wonder whether my hon. Friend, despite his deep knowledge of the subject, has not dismissed the important point raised by my hon. Friend the Member for Eastbourne (Mr. Gow) a little too quickly.
What I am concerned about is that we seem to be entering into what is not strictly parliamentary conduct. We have one hon. Member wishing to intervene during another hon. Member's intervention. I think that this is getting somewhat out of hand. Has the hon. Member for Mid-Sussex (Mr. Renton) finished his intervention?
I have not, Sir Myer, because I was pursuing this point. The point about it, Sir Myer, as you will certainly know, is that the fourth directive on company law has just been passed by the Commission. That directive demands that companies follow certain standards laid down by the EEC so far as auditing their accounts is concerned. The point raised by my hon. Friend the Member for Eastbourne is that we shall be changing from one treatment of deferred tax to another on 1st January. This will be substantiated in EEC requirements.If therefore we are running—
I am grateful to my hon. Friend. I would never dismiss lightly anything said by my hon. Friend the Member for Eastbourne (Mr. Gow). If I have missed some detail of EEC regulations and legislation for which Commissioner Jenkins or Viscount Davignon is responsible, I am sure, Sir Myer, that my hon. Friend will mention it if he catches your eye.
However, returning to the point I was making, I think that the nub of it was put in the Lex column in the Financial Times on Monday, when Lex wrote:
However in practice there are obvious drawbacks. Take a company which, for one reason or another, paid little tax in 1973 and lots in 1978 It could be tempted to provide for deferred tax just in order to smooth out its dividend cover, even although it felt that such a treatment was not really appropriate for the business. An attempt to build statutory restrictions on loose accounting practices is bound to lead to distortions-and will provide yet another incentive for companies to pick and choose their accounting policies.
I hope that Ministers are clear about whether they are prepared to encourage United Kingdom companies to pick and choose their accounting policies and about what effect that will have on economic and business management. We should restrict the Bill to the shortest possible time. I support the amendment.
I will be brief, and will talk precisely to the amendment. I am concerned about justice. If, with their parliamentary majority, including the support of a minority party which has taken its decision on political grounds rather than grounds of reason and sense, the Government are determined to force through the Bill, the injustice should last for the shortest possible time.
The speeches in this debate have added ammunition to our case. The Government pay lip service to people and to concern about unemployment. Unemployment can be solved only by confidence and investment. The Bill will reduce investment and allow unemployment to stay high and perhaps increase.
The hon. Member for Colne Valley (Mr. Wainwright), who is experienced in accountancy, made a brilliant speech on Second Reading, which I hope will be publicised tomorrow, both on the radio and in the press by those journalists who can write about such a complicated debate.
One reason that the hon. Member gave for the amendment was justice, and that is why I make a plea to the Minister of State. He is a man of considerable ability, though not perhaps with the business experience to understand what dividend restraint involves. My hon. Friend the Member for Walsall, North (Mr. Hodgson), who is experienced in these matters, has asked important questions. The Minister may think that some of our speeches have been rather trivial and humorous, but that to some extent is the fault of the hon. Member for Birmingham, Selly Oak (Mr. Litterick), who has now left the Chamber. He encouraged my hon. Friends to indulge in the sort of parliamentary behaviour of which you, Sir Myer, do not approve, but the Opposition have only certain ways of dealing with legislation that is driven through the Committee by people who do not understand what is at stake.
My hon. Friend the Member for Walsall, North and my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley), whose knowledge of money matters should be respected by all hon. Members, made useful speeches. My hon. Friends the Members for Worthing (Mr. Higgins) and Mid-Sussex (Mr. Renton) will also speak from their considerable experience of the economy and of industry and commerce. This Bill will affect industry and commerce.
The critical issue in the imminent General Election, which members of the Government will have to face, is likely to be unemployment. If the Government and their supporters are genuinely concerned about unemployment, they ought not to press this Bill through all its stages tonight, or, if they are determined to do so, they should heed the sensible amendment moved from the Liberal Benches. Unemployment can be remedied only by further investment. The Bill will inhibit investment. Therefore, the shorter time it is in effect, the less damage will it do and the sooner will greater confidence return to this country.
The trade union movement does not really want this face-saving device which the Government propose. As the hon. Member for Colne Valley said on Second Reading, the trade unionists see through it. It is meaningless, but it has an effect upon confidence and upon investment.
I put this plea to the Treasury Minister: think again; recognise the good sense behind the amendment. It is up to the Government not just to pay lip service to employment but to do something positive about it. The Bill is not required. The leaders of the trade union movement, who are politically motivated, may indicate that they require it for some sort of bargaining over the voluntary incomes policy which the Government are endeavouring to force upon the country, which also is meaningless, in my view, but it will not be helpful. We want employment, and the Bill will damage it.
I urge the Minister to show a glimmer of sense in the dying hours of this day, of this Parliament and of this Government. Perhaps he will go out of power then with a little bit of credibility.
The purpose of the amendments is to restrict the period for which the Government wish to extend dividend control, substituting for the end of July 1979 either October this year or December this year. There are powerful arguments in favour of the amendments.
I shall deal first with the argument that those of us who supported the original introduction of dividend control back in 1973 should in some way feel obliged to continue to support it now. That is an unbelievably naive argument. It may well be that at any given moment one feels that there is a case for a temporary measure, but that does not means that one ought to go on supporting it indefinitely, and least of all in the case of dividend control, because the distortions which it causes become greater and greater over time.
It is extraordinary that in recent weeks, week after week, when the Chief Secretary has been asked when this measure was likely to come forward, or whether it was to come forward, he has replied "At the appropriate time". We now know that the appropriate time means the last possible moment, it then being rushed through the House without adequate time to consider the ramifications, not the least of which is the important matter of the accounting profession's recommendations just raised by my hon. Friend the Member for Walsall, North (Mr. Hodgson).
The hon. Gentleman was one of those who supported the original measure in 1973. For the record, since it appeared that the hon. Member for Cirencester and Tewkesbury (Mr. Ridley) could not remember whether he had voted for it, it should be noted that in fact he voted for it, as did the hon. and learned Member for Solihull (Mr. Grieve). Is it that the country was in a worse state in 1973 and we needed this measure? Are the Opposition now arguing that the position has so much improved under this Government that it is no longer nececssary?
The question is simply one of equity and fairness. When we introduced it and I voted for it, we had a statutory policy on wages and we had a statutory policy on dividends. Therefore, it was an equitable arrangement. But nothing could be less equitable to dividend recipients, not least pensioners and others in my constituency, than the performance that we have had on dividends under this Government.
The Government came into office in February 1974. For nearly two years we had a wages explosion. There were tremendous increases—increases of 30 per cent. to 35 per cent. or more were given to people under various trade union wage claims. Meanwhile, dividend control continued. I hope that the Minister of State, who is muttering to himself, will be kind enough to tell us exactly what the figures were for each year from 1974 until now for the increase in wages and the increase in dividends. This is a vital matter, and it is why the measure should not be continued any longer. That is why I support the amendments.
This is a matter of great concern to my constituents. My constitutents, many of whom are on fixed incomes, many of whom rely on insurance policies or their savings invested in equity shares, have been grossly penalised under this Government because of the way in which dividend control has been imposed at the same time as the Government have failed to control wages and earnings.
I suggest that the hon. Gentleman's constituents were more grossly penalised by the money which he and his colleagues printed whilst at the Treasury, which caused the monetary explosion two years later and created the high rate of inflation.
The answer to that is very simple: my right hon. Friend the Leader of the Opposition gave it in the debate only two days ago—that we were told in October 1974 that all was well, that with all the problems of inflation, all the problems of unemployment and so on, everything was all right. Therefore, the right hon. Gentleman cannot argue that. It is a completely false argument, and he is estopped from putting it forward.
I want a specific answer from the right hon. Gentleman to the following question, because we can judge the amendments only in the light of the answer. What has been the percentage increase in wages and dividends in each year since 1974? It is a matter of tremendous importance to my constituents. They have suffered as a result of the inequitable policy of this Government.
It is not simply a matter of the period 1974, 1975, 1976. It is equally true of the last stage of the Government's pay policy, which we are told has been a tremendous success. What happened? We had a 10 per cent guideline, which shifted from being a guideline on earnings to being a guideline on wage rates and so on. I think that it is now generally conceded that the increases were of the order of 15 per cent., or more—in many cases a great deal more. In some cases, such as wages councils, they were up to 20 per cent.
Those increases were being paid to people under the Government's pay policy at the same time as dividends were being restricted to 10 per cent. My constituents who have been relying on dividends or on their pensions have been restricted accordingly. Therefore, even in the most recent period of Government pay policy the constraint on dividends has been grossly unfair. I do not see that the right hon. Gentleman can seriously dispute that.
I want to take up another point which is relevant to the amendments. It was made by the Prime Minister in a rather more technical passage of an otherwise sordid speech. He said:
the Government have decided to introduce this Bill
—the one we are now debating—
because, in our view, it would be quite wrong, when we are asking working people to exercise moderation on pay in the year ahead,
I stress "the year ahead", because that is what the amendment is concerned about, namely, the duration of this measure—
to fail to do everything in our power to see that moderation is exercised with dividend payments.
I do not believe that the argument is conclusive that insurance policy holders or pension fund beneficiaries will be adversely affected by this measure. What affects them even more than dividend control is the erosion of the value of their savings by inflation, and they have as much to gain as any other group"— [Official Report, 25th July 1978; Vol. 954, c.1386.]
from the prevention of that, I agree, but it will be clear to the Committee that there is a monumental non sequitur in the Prime Minister's argument. It does not follow at all that because inflation is being brought under control such people should have their incomes restricted. Anyway, the policy as it has operated in the past year and as it is now proposed to operate under the Bill is grossly inequitable. That is why I believe there is a strong case for the amendments. The fact is that it is naive to suppose that the imposition of this measure will have any significant impact on the level of inflationary wage claims.
The Chief Secretary sought on Second Reading, in a rather bumptious speech, to suggest that a great deal of these dividends go to people on high incomes. He totally failed to answer—I hope that the Minister of State will do so—the question of precisely how much of any given dividend increase received by someone on a high income will go in taxation. The Chief Secretary seemed to express surprise that somehow we thought taxation was relevant in this context. Quite clearly, if one is considering whether the policy is equitable, it is after-tax income that one is concerned with, not pre-tax income. It is important that that point should be made.
My next point again concerns the duration of the measure—should it go on for four months, six months, or a year? It is the question of the distortion of the capital markets. We had a wide-ranging debate on the point and we asserted that the effect of dividend control was to create a situation where capital markets were distorted so that money—that is to say, capital—did not go into those firms which were most efficient and which paid the greatest yield.
A number of hon. Members opposite said that it did not really matter because companies were ploughing the money back and that therefore all was well. But it is not well at all. We do not want companies necessarily to plough money back; it is better that it should be distributed through the market and go to firms which have greatest need of it. The longer this distortion goes on, the worse it is. That is why we should not have a 12-month continuation. It continues to create a gross maldistribution of the resources of our economy to the detriment of everyone, not just the poor, or the rich, or those in the middle, but everyone.
Is not the situation even worse than my hon. Friend has suggested, in that some companies not only are not ploughing it back into their own businesses, let alone having it redistributed through the market, but in some cases are keeping it in cash in their balance sheets? I am referring, for example, to the consolidated balance sheet of John Haggas Limited, for the year ended 30th June 1977, showing that it has £6 million invested in gilt-edged. Is that a good way to regenerate the British economy?
It is not a way to regenerate the British economy at all. It is a way of getting the Government off the hook of having a borrowing requirement that is too large. But I should be out of order, Sir Myer, if I were to pursue that point.
We have had a Second Reading debate on extending the Bill from 31st July 1978 to 31st July 1979. We had hours of debate on Second Reading—there was even difficulty getting hon. Members to come in and take part. Now we are beginning to get it resuscitated and are getting into a Second Reading debate again. That is my opinion.
Further to that point of order, Sir Myer. I must say to you that I spent a considerable time this afternoon trying to get in on the Second Reading debate, and I did not succeed. I am not now making a Second Reading speech. Had I been out of order earlier, surely you would have called me to order, which you did not do. When I was tempted by my hon. Friend the Member for Walsall, North (Mr. Hodgson), I immediately made but a passing reference and said that I did not propose to go out of order on that point.
That may be, Sir Myer. Perhaps that may be true of all of us. Perhaps I may pursue the point as to the length of time this measure should continue, which is the point to which I have addressed my remarks throughout. In my view, there is not a case for continuing it for 12 months. The amendment would improve the situation because of the serious effects which I believe the measure will have both on one's constituents and on the economy as a whole.
There is a point here, on which I hope we shall have clarification from the Minister of State in winding up the debate, with regard to the duration of the policy. The Chancellor of the Exchequer this afternoon at Question Time, in a rather remarkable statement, said that all the economic policies of the Government had the support of the IMF. Can the Minister of State tell us whether the perpetuation of dividend control for another 12 months has the explicit support of the IMF? I should be very surprised indeed if that were so.
As to the duration of dividend control, in putting forward these proposals the Government have suggested throughout—and particularly the Financial Secretary, who, I am glad to see, has just returned to his place—that they have to proceed by consensus. That is the key word that we have heard throughout the day in justifying the extension of dividend control for another year. What opportunity for expressing a consensus do any of my constituents, living on fixed incomes and investments in equities, have? They are not to be given any opportunity whatsoever to reach a consensus. My constituents will have no option to reach a consensus.
Under the Bill, if the Government get their way and it is for a year and not for some shorter period, my constituents will be forced to conform, whereas those who are getting wage claims granted which are far in excess of anything that my constituents have had over the last five years will be part of the consensus. It is a very partial sort of consensus that the Government want for 12 months rather than four months. That being so, it seems to me that this is a measure which ought to be curtailed at the earliest possible moment.
Finally, I turn to the question of dividend cover and the proposals made in the Bill. Again, I hope that if the Government are really proposing it for 12 months, they will make clear their intentions tonight. Surely, in considering the duration for which we ought to have dividend control extended we ought to consider what it is that the Government have in mind. As I understand the position, the original resolution was implemented by a statutory instrument, but its operation has turned upon the way in which the Treasury has decided to agree or not to agree to a given increase of dividend or to the maintenance of existing dividends.
In the light of the press notice from the Treasury, I understand that the Treasury will take into account several different factors in deciding whether to give consent. It is surely right in deciding what the duration of the measure should be to know on what criteria the Government and the Treasury propose to give consent to any given increase in dividend. I hope, therefore, that the Minister of State will not hesitate to ensure that that is covered during the course of the debate.
For all these reasons, I believe it right and proper that the Government should give us an answer to these points before we decide what to do about the group of amendments, which I believe have powerful arguments in their favour.
I rise to support the amendment moved by the hon. Member for Colne Valley (Mr. Wainwright). Of course, it was my hope, Sir Myer, that the Chairman of Ways and Means would select amendment no. 2, which stands in the names of my hon. Friend the Member for Horsham and Crawley (Mr. Hordern) and my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley). But very often in life we have to make do with second best. That is why, as amendment no. 2 was not selected, we turn to the amendment proposed by the spokesman for the Liberal Party.
In the beneficent presence of my hon. Friend the Member for City of London and Westminster, South (Mr. Brooke) I wish to follow the remarks of my hon. Friend the Member for Worthing (Mr. Higgins). When we are deciding for how long the measure should remain in operation we are entitled to reflect how it will affect our constituents. My hon. Friend the Member for Worthing has a unique qualification for addressing the Committee. He used to occupy the post held by the Minister of State at the Treasury, who is to reply to the debate.
It would be invidious to make a comment upon the contrast between the virtues of my hon. Friend and, as I believe, the shortcomings of his successor. My hon. Friend the Member for Worthing—I do not wish to embarrass him by suggesting that he has anything in common with the hon. Member for Eastbourne—has, like the hon. Member for Eastbourne, a very high proportion of his constituents over the age of 65. I invite my hon. Friend to correct me when I suggest that 34 per cent. of his constituents are over the age of 65.
Since we are in this game of statistics, particularly in relation to those of our constituents who are elderly and dependent for their livelihoods on fixed incomes and investments, may I draw my hon. Friends attention—lest it be thought that Worthing and Eastbourne have a monopoly in this matter—to the fact that further down the coast, in areas represented by my hon. and learned Friend the Member for Dover and Deal (Mr. Rees) and myself, there are even higher figures? There are 36 per cent. to 37 per cent of the population over the age of 65, many of them dependent upon fixed incomes and equities for their livelihood.
Order. I regret very much having to say that I am now experiencing something which I have not experienced during four years in the Chair, namely, behaviour that is wholly unbecoming. We have one intervention and then the hon. and learned Member for Solihull (Mr. Grieve) is intervening on an intervention. I do not think that that is behaviour which does credit to the British House of Commons.
The longevity of the constituents of my hon. Friend the Member for Thanet, East (Mr. Aitken) will come as no surprise to the Committee. If I were a constituent of my hon. Friend, I believe that I, too, should live for ever.
My point is that those who are dependent upon what the Government call unearned income and what I prefer to call hard-earned and hard-saved income have a particular interest in bringing this measure to an end as early as possible. This is where my hon. Friend the Member for Worthing and I have this common bond. This possibly applies to my hon. Friend the Member for Thanet, East and perhaps my hon. Friend the Member for Horncastle (Mr. Tapsell). Up to a third of our constituents are dependent upon their hard-earned, hard-saved income. That is why we want to bring this Bill to an end as soon as possible.
At the beginning of this debate we saw the fleeting presence of the Chancellor of the Duchy of Lancaster. When this matter was debated around the Cabinet table, I expect that the Chancellor of the Duchy raised his voice against the Bill and in favour of an amendment —although it was not then tabled—along the lines of the one moved by the hon. Member for Colne Valley.
Looking at the Government list one sees that there are 24 members of the Cabinet, and the Chancellor of the Duchy is No. 24. He is five places below the Chief Secretary to the Treasury, who is not with us at present. There is little doubt that both the Chancellor of the Duchy and the Chief Secretary are really hoping that the Liberal amendment is carried tonight.
When we decide how long this Bill should remain in operation, we are entitled to look at the parent Act. A great deal of criticism has been levelled at some of my hon. Friends because of the way in which they voted in favour of the parent Act in 1973. Some of us, whatever our sins, were not guilty of that particular sin. Had we been here we might have been guilty, but by an accident of events were were not here.
My hon. Friend should not press my hon. Friends too hard to recant on their previous votes. Recently
I was reading how the present Prime Minister once challenged Winston Churchill on a point of inconsistency because he had altered his views. The Prime Minister was floored by the Churchillian retort:
My views are a harmonious process in relation to current events.
Surely the same could apply in this case.
Mr. Gow: I am grateful to my hon. Friend, who has called in aid a former Prime Minister. In defence of my hon. Friends I call in aid the Lord President of the Council, who once said that a foolish consistency was the hobgoblin of little minds.
Section 10(2) of the parent Act says:
The powers conferred by subsection (1) above shall be exercisable by order, or by notice given to the company, or each of the companies, affected by the notice.
My hon. Friend the Member for Croydon, South (Mr. Clark), with his prolonged experience of financial matters at the very highest levels, explains to me that he agrees with my criticisms.
In these amendments we are saying that we wish to restrict for as short a period as possible the power of the Treasury, by order or by notice, to restrict the declaration of dividends, because we do not like Ministers, least of all these Ministers, issuing notices and orders without the necessity for the assent of the House in accordance with section 10. There is power for an order under section 10 to be annulled in pursuance of a resolution of either House of Parliament, but that power does not apply to a notice.
There is an amendment in the name of the hon. Member for Eastbourne suggesting that no order could be made unless it had been approved by a resolution of this House. That was not a bad suggestion, but, unfortunately, the amendment was not selected.
What is the objection to following, just once, the guidance of the Liberal Party? It was once described by Lord Butler as a band of visionary missionaries with neither vision nor mission. I do not quarrel with that opinion, but it would be unfair to say that no good thing can come out of Colne Valley. Sometimes good things can come.
I was paying tribute to the hon. Member for Colne Valley for the way in which he had drafted the amendment, because its effect will be that we shall have the Bill not for 12 months, as the Government propose, but for only five months. We could look at the matter again in five months' time. My hon. and learned Friend the Member for Dover and Deal and my hon. Friends the Members for Horsham and Crawley and Worthing will be able to speak with even greater authority then.
There is no reason for us to extend this power of the Treasury for as long as 12 months. We have become mesmerised by a period of 12 months. I am glad to see that my hon. Friend the Member for City of London and Westminster, South nods in assent. We should not be mesmerised by the period of 12 months. There is no intrinsic superiority in that period over five months, and that is the burden of the amendment moved by the solitary representative of the Liberal Party, the hon. Member for Colne Valley.
It is not only the Liberal Party that is in favour of five months as opposed to 12 months. The Liberal Party is hell bent en creating not Europe des patries, as I should like, but either a unitary State or a federal State. Therefore, it wants to move away from dozens. As even the hon. Member for Colne Valley will agree, there are 12 in a dozen. If the Liberals have their way, we shall move only in decimals. However, there is nothing magic about 12 months. The hon. Gentleman has hit upon that. He is asserting that there is sometimes virtue in five rather than 12.
The Committee would be well advised—this does not happen very often—to accept the advice offered to us by the solitary representative of Liberalism. Before my hon. Friends add the weight of their voices, we need to remind ourselves that those who have retired and those no longer able to work desire and should receive the consideration of the House of Commons.
At this stage I should intervene. There have been a number of speeches and a number of questions have been asked. Some of the questions did not necessarily appertain strictly to the amendment, but they were still important and I shall do my best to answer them.
Before I deal wth the amendment of the hon. Member for Colne Valley (Mr. Wainwright) I shall deal with two questions. The hon. Member for Walsall, North (Mr. Hodgson) asked about the change that might take place in the accounting system as a result of various guidances issued by the accountancy bodies. The hon. Gentleman will not expect me to comment on the way in which the cover provisions will apply to a particular company. The Treasury will have to apply the provisions according to the way in which a company puts forward its accounts. I think that he will agree that the provisions will have to be applied on a consistent basis. It would not be right to apply one form of accounting procedure for year three, for example, and different procedures for years two and one. The answer that I give him may not be entirely satisfactory, but the accounting will have to be applied on a consistent basis. The cover provisions could not be applied on one basis for one year and on another for another year.
Do the right hon. Gentleman and his advisers consider it possible to adjust back to take care of inconsistencies or changes in accounting procedures? Often it is not possible to make backwardation historic adjust ments?
I am not an expert on these matters. I accept that it is probably difficult to adjust in that way. The Treasury, with its accounting experts and its accountant, will attempt to come to some arrangements with the companies to apply on a consistent basis.
The hon. Member for Worthing (Mr. Higgins) made an extraordinary speech. I have great regard for the hon. Gentleman. I note that he is no longer in the Chamber. I shall wait until he returns before I answer his question.
The amendment seeks to limit the date of operation of the Bill to 31st December 1978. He said that he was moving the amendment as a contribution towards a consensus. He accepted that there had to be some sort of consensus on incomes, profits and dividends. As the Government were seeking to get consensus on incomes, he accepted that there had to be some consensus on dividends. However, he thought that that should stop in December.
All that the hon. Gentleman is putting forward is half a contribution towards a consensus. The period to 31st July 1979 more or less covers the pay round. But the hon. Gentleman wants to stop in the middle of the pay round.
In December many of the more vital wage agreements come up. For example, the National Union of Mineworkers may be negotiating at that time, and other groups negotiate from November onwards. The House of Commons having accepted on Second Reading that we should have statutory dividend restraint, I cannot think of anything more silly than that in December—right in the middle of vital negotiations affecting the rate of inflation and the economy—dividends should be freed. If the Bill did not become law, we could have companies declaring dividends of possibly 200 per cent. to 300 per cent. and these being blazoned in the newspaper headlines at the very time that workers will be negotiating wage increases and the Government will be asking for those increases to be restricted to 5 per cent.
Would it not be possible for the right hon. Gentleman to take a mature attitude to negotiations with any group of workers seeking a pay increase by explaining that, as two-thirds of dividends go to institutions, pension funds and so on, he is safeguarding not only their present position by allowing them a certain amount of increase in pay but their pension arrangements by allowing pension funds to be increased as well?
Those arguments could be put forward, and no doubt attempts will be made to do so. But I suggest that it is much better in this vital area not to get involved in that kind of debate. It is better to have the restriction which has been accepted on Second Reading. I suggest that it does not make sense to stop at 31st December 1978. If we are to operate an incomes policy, it is necessary to have some restraint on dividends. I think that the hon. Member for Colne Valley accepts that proposition. All I am saying is that it makes no sense to stop that restraint during the most crucial part of a pay round when very important pay claims are being negotiated.
I apologise for being out for a couple of minutes during the last four hours and I am sorry that I missed the right hon. Gentleman's opening sentences. Is there not a case for having a short period of extension so that the Government can convey to those making wage claims the gross injustice that has already been done to those receiving dividends? Instead of saying "Because we are incapable of doing this, we must do it by legislation", could they not put forward what is a fair legitimate and sensible argument?
The hon. Gentleman made an extraordinary speech. He talked about gross injustice to pensioners in his constituency and I intervened to say—and I say again—that the greatest injustice done to pensioners in his constituency was the money supply policy of the Conservative Government. Indeed, the hon. Gentleman was Minister of State at the Treasury at the time, presumably with some responsibility, as I have, for money supply. I suggest that he should have thought about his elderly pensioners when he agreed to an increase in the money supply.
On Second Reading the House accepted, by a fairly comfortable majority, that it wished dividend restraint to proceed for another year. I suggest that it makes no sense to stop that restraint in the middle of a pay round. It is better that it should extend to July to cover the whole of the pay period in order to secure moderation in wage claims over the next 12 months and thereby seek a continual moderation in the rate of infla- tion. For that reason, I recommend the Committee to reject the amendment.
We have had a spirited debate. That is not surprising. Indeed, it is commendable. Of course, I am not suggesting that either the Chair or the Government wish to cut short the debate.
We are debating what may turn out to be the last unattractive legislative twitch of a dying Government. It is not for me to forecast what is passing through the Prime Minister's mind now, or what he may think in August or September, but I think that we should be failing in our duty if we did not give this measure the most careful, detailed and thorough scrutiny.
I am glad to see that I carry with me the Treasury Bench. We may soon reverse our roles and those on the Treasury Bench know, that it will then be their duty to give our measures the most careful scrutiny. I have no doubt that they will be delighted to do so, and we shall welcome their constructive criticisms, just as I know that over the past four years they have welcomed the constructive criticisms that we have offered over a wide range of financial measures. If the Chief Secretary were candid with the Committee he would recognise that there has been too wide a range of financial measures that perhaps he has taxed his own stamina and the patience of the House just a little too much. However, we are prepared to let bygones be bygones.
Having said that, I offer my respectful sympathy to the Chair, because I recognise that it has been a little difficult to channel our contributions in this debate. The reason is not far to seek, and I think that it is right that we should put it on record. It is due to the extraordinarily narrow way in which the Long Title to the Bill has been drawn, which has effectively precluded a proper examination of the principles of this important Bill. If this is to become a constitutional precedent—
Order. The hon. and learned Member has been in the Committee throughout the whole of the debate. He has heard the Chair remonstrating with hon. Members who have not conformed strictly to the way in which the business of the Committee is conducted, which is for hon. Members to address themselves to the subject under consideration. In this instance it is the amendment that has been selected for debate, together with the three amendments that have been grouped with it. I hope that the hon. and learned Gentleman will try to set an example to other hon. Members.
On a point of order, Sir Myer. I have listened to nearly every word that has been spoken in this debate, and I am at a loss to understand which of my hon. Friends, and where, have been out of order. I do not know when you have called any of my hon. Friends to order for going outside the terms of the amendment, and these vague threats make it more difficult for us to speak, because in future contributions on this amendment my hon. Friends will have difficulty in knowing whether they are near the boundaries of order.
As I was saying Sir Myer, I am always ready to take a lesson and correction from the Chair, but I think that I am entitled and, indeed, bound to comment on the way in which the Long Title has been drawn, which has effectively circumscribed—
I am glad that my intervention was in order after all, Sir Myer, as I expected it to be. We recognise that the narrow way in which the Long Title is drawn has made it difficult for the Chair. It has been difficult for my hon. Friends to confine their remarks, because, naturally, they are exercised by the principle and detail of the Bill.
It is a matter for comment that a Government who have introduced a mass of provisions designed to favour the introduction of share incentive schemes should, with their other hand, have made those schemes look less attractive.
In debating the terminal date for the Bill we have been obliged to consider both the principle and detail of the measure. It is noticeable that there have been no interventions from the Government side of the Committee, except from the Minister of State. Obviously, Government Members are not concerned about shareholders, investors, retired people and pensioners in their constituents. They are concerned only about narrow, sectional interests. They are not prepared to take a broad view of their responsibilities to the electorate, as we are on this side of the Committee.
Because of the lateness of the hour and the obvious impatience of the Committee to move on to the debate on the clause and to Third Reading, I do not intend to cover the principles, because they have been dealt with adequately. But I single out and commend the speech by my hon. Friend the Member for Worthing (Mr. Higgins). He has had to look at this problem from both sides—with the responsibility of office and with the responsibility of Opposition. He made a telling intervention. He has demonstrated conclusively from his vast experience that the measure is not attractive from a temporary point of view—
I think that the Chief Secretary is getting a little cheap. We know that he is a little frayed after a rather hard Session. We know that he deserves a holiday and that he might soon be taking a rather longer holiday than he foresees.
As I was saying when I was so coarsely and rudely interrupted by the Chief Secretary from a sedentary position, my hon. Friend the Member for Worthing has demonstrated that this is unattractive as a temporary expedient. It becomes intolerable if it is perpetuated year after year. Distortions in the capital market make a mockery of the whole capitalist system.
This is the moment when hon. Members below the Gangway leap to their feet and wave their Order Papers, because they have no desire to perpetuate the capitalist system. I am not certain where the Financial Secretary stands on this issue. I have always understood that he was dedicated to private enterprise. I understand that he has a personal interest and even enthusiasm for it. I cannot say that his defence of it this afternoon, or even his defence of the Bill, was commendable, attractive, or profound.
When we turn to the detail—and this will interest the Minister of State, who attempted to deal rather perfunctorily with the case made by my hon. Friend the Member for Walsall, North (Mr. Hodgson)—we discover that the Bill is not only bad in principle but bad in detail.
Of course we must proceed on the polite fiction that the House of Commons has given its approval to the Bill. It was given by a narrow margin. I have no doubt that had more time been allocated to it and we had considered the Bill at a more appropriate moment in the Session, instead of cramming it in in the last few days, a different decision would have been reached. Every possible opportunity was given to the Government both at Question Time and in debate to declare their hand, but they did not choose to do so. We can only speculate why. Probably there have been tense negotiations between the Government and the trade union movement.
One wonders, after the declaration today, just whose good offices or favours the Government are bidding for. We feel that since the Bill is demonstrably bad in detail and in principle we should give the Government the chance to think again. Therefore we shall join the hon. Member for Colne Valley (Mr. Wainwright) should be feel disposed to press his amendment, or my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) with his if the hon. Member should not.
We are faced with a compelling range of amendments. If one were carried, we should be able to return, as the House should at the earliest possible opportunity, to the Bill. A small cloud hangs over our activities in the autumn. But in case, contrary to expectation, there is no General Election, we feel that the Government should be compelled to reconsider the question again in the later stages of the autumn.
If there is an election, a quite different scene might obtain. I am for the moment being charitable in assuming that we shall still be looking at the Chief Secretary, the Minister of State and the Financial Secretary across the Dispatch Box. We should like them, in a more dispassionate atmosphere, free of the trammels of the Finance Bill and away from Transport House, to return to consider once again the more compelling arguments that have been advanced from this side of the Committee. I hope, therefore, that my hon. Friends will support the hon. Member for Colne Valley in his laudable attempt to bring a little more sense into an unsatisfactory piece of legislation.
I am aware that part of the course of the debate has caused some anxiety and concern to the Chair. In so far as the debate has rambled at times, it has been largely due to the trilogy of poor parliamentary behaviour by the three Ministers who have had charge of the Bill.
The debate started with a performance of unusually bumptious frivolity by the Chief Secretary, to the evident distaste of the House, including some Labour Members. There was a display of tedious arrogance in the Financial Secretary's winding-up speech. The Minister of State's attitude just now was one of casual irresponsibility which accorded ill with the helpful comments of some speakers on the Opposition side of the House.
Any agony that you may have suffered in the Chair, Sir Myer, will have been in a good cause, because at least the debate has demolished—and this was a valuable contribution of common sense to financial affairs—this unutterably glib sentence in the Treasury notice which purports to say how the dividend cover notice will be operated. I risk repeating something that I said on Second Reading, that the statement by, of all bodies, Her Majesty's Treasury, that
where there have been changes in accounting policies the cover for each of the relevant years will be computed on a consistent basis
was bogus. The Minister of State had to confess just now that this will not be the formula. As he said, in each case the Treasury will come to some arrangement with the companies concerned.
At long last we have that position established. These matters will not all be handled according to this glib Treasury formula. It will be a matter of horse trading on the basis of such figures as can be fudged together on both sides of the argument. It is helpful to have got down to reality after all these hours.
The amendment is designed not to wreck the Bill but to establish some kind of balance between statutory control of dividends and more or less voluntary restraint on pay. In order to narrow the gap between those two quite conflicting principles it seems reasonable to say that at about Christmas time the House should have an opportunity to review the whole matter.
It is a poor show for the Minister of State to say that this would mean that statutory control of dividends would collapse in ruins, of necessity, by Christmas time, because the Government have proved today that they can get this kind of measure through the House in one afternoon and evening. Therefore, if the next Parliament, misguided or otherwise, wishes towards the end of this calendar year to renew this control, or, one would hope, to refine and improve its methods, it would be perfectly able to do so.
The idea that my amendment in some way wrecks the operation of dividend control is self-evident nonsense, as has been proved by the Governments success tonight in getting this measure through in a matter of a few hours.
Finally, I must protest at the glib way in which the Minister of State says that a review of this matter at the end of December would come in the middle of a pay round. Where has he been these last few years to be still talking about a pay round? There is no longer a pay round. That is a concept that belongs to history. Now it is a constant series of negotiations which have no particular seasonality. I am really surprised that someone who is supposed to be brooding over pay controls should still think that this is a question of a pay round with a peak point in December. It is just not so.
Bearing in mind the contributions we have heard this evening from some hon. Members, which have illuminated this subject, I shall recommend my right hon. and hon. Friends to divide the House, and I hope that we shall have support from all quarters.
(seated and covered): On a point of order, Sir Myer. There is an amendment standing in the name of my hon. Friend the Member for Mid-Sussex (Mr. Renton), who has been seeking an opportunity of addressing the Committee but has not had such opportunity. I wonder, Sir Myer, whether you had overlooked that fact when you agreed to accept the motion moved by the Government Deputy Chief Whip.
|Division No. 318]||AYES||[12.22 a.m.|
|Archer, Rt Hon Peter||Fernyhough, Rt Hon E.||Maclennan, Robert|
|Armstrong, Ernest||Fitch, Alan (Wigan)||McMillan, Tom (Glasgow C)|
|Ashton, Joe||Fitt, Gerard (Belfast W)||Madden, Max|
|Atkins, Ronald (Preston N)||Flannery, Martin||Magee, Bryan|
|Atkinson, Norman (H'gey, Tott'ham)||Fletcher, L. R. (Ilkeston)||Maguire, Frank (Fermanagh)|
|Bagier, Gordon A. T.||Fletcher, Ted (Darlington)||Mallalieu, J. P. W.|
|Bain, Mrs Margaret||Foot, Rt Hon Michael||Marks, Kenneth|
|Barnett, Guy (Greenwich)||Forrester, John||Marshall, Dr Edmund (Goole)|
|Barnett, Rt Hon Joel (Heywood)||Fraser, John (Lambeth, N'w'd)||Marshall, Jim (Leicester S)|
|Bates, Alt||Freeson, Rt Hon Reginald||Maynard, Miss Joan|
|Bean, R. E.||Garrett, John (Norwich S)||Meacher, Michael|
|Benn, Rt Hon Anthony Wedgwood||George, Bruce||Mikardo, Ian|
|Bennett, Andrew (Stockport N)||Gilbert, Rt Hon Dr John||Millan, Rt Hon Bruce|
|Bidwell, Sydney||Golding, John||Miller, Dr M. S. (E Kilbride)|
|Bishop, Rt Hon Edward||Gould, Bryan||Mitchell, Austin (Grimsby)|
|Bienkinsop, Arthur||Graham, Ted||Mitchell, R. C. (Soton, Itchen)|
|Boardman, H.||Grant, John (Islington C)||Molloy, William|
|Booth, Rt Hon Albert||Grocott, Bruce||Moonman, Eric|
|Boothroyd, Miss Betty||Hardy, Peter||Morris, Alfred (Wythenshawe)|
|Bottomley, Rt Hon Arthur||Harrison, Rt Hon Walter||Morris, Rt Hon Charles R.|
|Boyden, James (Bish Auck)||Hart, Rt Hon Judith||Morris, Rt Hon J. (Aberavon)|
|Bray, Dr Jeremy||Hattersley, Rt Hon Roy||Morton, George|
|Brown, Robert C. (Newcastle W)||Hayman, Mrs Helene||Moyle, Rt Hon Roland|
|Brown, Ronald (Hackney S)||Healey, Rt Hon Denis||Mulley, Rt Hon Frederick|
|Buchan, Norman||Heffer, Eric S.||Murray, Rt Hon Ronald King|
|Butler, Mrs Joyce (Wood Green)||Henderson, Douglas||Newens, Stanley|
|Callaghan, Rt Hon J. (Cardiff SE)||Hooley, Frank||Noble, Mike|
|Callaghan, Jim (Middleton & P)||Horam, John||Oakes, Gordon|
|Campbell, Ian||Howell, Rt Hon Denis (B'ham, Sm H)||Ogden, Eric|
|Canavan, Dennis||Hoyle, Doug (Nelson)||O'Halloran, Michael|
|Cant, R. B.||Huckfield, Les||Orme, Rt Hon Stanley|
|Carmichael, Neil||Hughes, Rt Hon C. (Anglesey)||Ovenden, John|
|Carter, Ray||Hughes, Mark (Durham)||Palmer, Arthur|
|Carter-Jones, Lewis||Hughes, Robert (Aberdeen N)||Park, George|
|Cartwright, John||Irving, Rt Hon S. (Dartford)||Parker, John|
|Castle, Rt Hon Barbara||Jackson, Colin (Brighouse)||Parry, Robert|
|Clemitson, Ivor||Jackson, Miss Margaret (Lincoln)||Pavitt, Laurie|
|Cocks, Rt Hon Michael (Bristol S)||Janner, Greville||Pendry, Tom|
|Coleman, Donald||Jay, Rt Hon Douglas||Prescott, John|
|Concannon, Rt Hon John||Jager, Mrs Lena||Price, C. (Lewisham W)|
|Cook, Robin F. (Edin C)||Jenkins, Hugh (Putney)||Price, William (Rugby)|
|Corbett, Robin||John, Brynmor||Radice, Giles|
|Cowans, Harry||Johnson, James (Hull West)||Rees, Rt Hon Merlyn (Leeds S)|
|Craigen, Jim (Maryhill)||Jones, Alec (Rhondda)||Reid, George|
|Crawshaw, Richard||Jones, Barry (East Flint)||Richardson, Miss Jo|
|Cronin, John||Jones, Dan (Burnley)||Roberts, Gwilym (Cannock)|
|Crowther, Stan (Rotherham)||Judd, Frank||Robertson, George (Hamilton)|
|Cryer, Bob||Kaufman, Rt Hon Gerald||Robinson, Geoffrey|
|Cunningham, G. (Islington S)||Kerr, Russell||Roderick, Caerwyn|
|Cunningham, Dr J. (Whiteh)||Kilroy-Silk, Robert||Rodgers, George (Chorley)|
|Dalyell, Tam||Kinnock, Nell||Rodgers, Rt Hon William (Stockton)|
|Davidson, Arthur||Lambie, David||Rooker, J. W.|
|Davies, Bryan (Enfield N)||Lamborn, Harry||Roper, John|
|Davies, Rt Hon Denzil||Lamond, James||Ross, Rt Hon W. (Kilmarnock)|
|Davis, Clinton (Hackney C)||Latham, Arthur (Paddington)||Rowiands, Ted|
|Deakins, Eric||Leadbitter, Ted||Sedgemore, Brian|
|Dean, Joseph (Leeds West)||Lee, John||Selby, Harry|
|de Freitas, Rt Hon Sir Geoffrey||Lestor, Miss Joan (Eton & Slough)||Sever, John|
|Dell, Rt Hon Edmund||Lewis, Ron (Carlisle)||Shaw, Arnold (Ilford South)|
|Dewar, Donald||Litterick, Tom||Sheldon, Rt Hon Robert|
|Dormand, J. D.||Loyden, Eddie||Shore, Rt Hon Peter|
|Douglas-Mann, Bruce||Luard, Evan||Silkin, Rt Hon John (Deptford)|
|Duffy, A. E. P.||Lyon, Alexander (York)||Silkin, Rt Hon S. C. (Dulwich)|
|Dunnett, Jack||Lyons, Edward (Bradford W)||Sillars, James|
|Eadie, Alex||Mabon, Rt Hon Dr J. Dickson||Silverman, Julius|
|Edwards, Robert (Wolv SE)||McCartney, Hugh||Skinner, Dennis|
|Ellis, John (Brigg & Scun)||McDonald, Dr Oonagh||Smith, Rt Hon John (N Lanarkshtre)|
|English, Michael||Mcflhone, Frank||Snape, Peter|
|Evans, loan (Aberdare)||MacFarquhar, Roderick||Spearing, Nigel|
|Evans, Join (Newton)||McGuire, Michael (Ince)||Spriggs, Leslie|
|Ewing, Harry (Stirling)||McKay, Allen (Penistone)||Stallard, A. W.|
|Faulds, Andrew||MacKenzie, Rt Hon Gregor||Stewart, Rt Hon M. (Fulham)|
|Stoddart, David||Walker, Harold (Doncaster)||Williams, Alan Lee (Hornch'ch)|
|Stott, Roger||Walker, Terry (Kingswood)||Williams, Rt Hon Shirley (Hertford)|
|Strang, Gavin||Ward, Michael||Wilson, Gordon (Dundee E)|
|Summerskill, Hon Dr Shirley||Watkins, David||Wilson, Rt Hon Sir Harold (Huyton)|
|Taylor, Mrs Ann (Bolton W)||Watkinson, John||Wilson, William (Coventry SE)|
|Thomas, Jeffrey (Abertillery)||Weetch, Ken||Wise, Mrs Audrey|
|Thomas, Mike (Newcastle E)||Weitzman, David||Woodall, Alec|
|Thomas, Ron (Bristol NW)||Wellbeloved, James||Woof, Robert|
|Thorne, Stan (Preston South)||White, Frank R. (Bury)||Wrigglesworth, Ian|
|Tilley, John||White, James (Pollok)||Young, David (Bolton E)|
|Tomlinson, John||Whitehead, Phillip|
|Tomney, Frank||Wigley, Dafydd||TELLERS FOR THE AYES:|
|Urwin, T. W.||Willey, Rt Hon Frederick||Mr. James Hamilton and|
|Varley, Rt Hon Eric G.||William, Rt Hon Alan (Swansea W)||Mr. James Tinn.|
|Wainwright, Edwin (Deanne V)|
|Aitken, Jonathan||Johnston, Russell (Inverness)||Sainsbury, Tim|
|Baker, Kenneth||Kitson, Sir Timothy||Smith, Cyril (Rochdale)|
|Beith, A. J.||Lawrence, Ivan||Steel, Rt Hon David|
|Brooke, Hon Peter||Lawson, Nigel||Stradling Thomas, J.|
|Budgen, Nick||Macfarlane, Neil||Tapsell, Peter|
|Clark, William (Croydon S)||MacGregor, John||Thorpe, Rt Hon Jeremy (N Devon)|
|Cooke, Robert (Bristol W)||Page, John (Harrow West)||Viggers, Peter|
|Emery, Peter||Pardoe, John||Wainwright, Richard (Colne V)|
|Freud, Clement||Penhaligon, David||Weatherill, Bernard|
|Gow, Ian (Eastbourne)||Rees, Peter (Dover & Deal)||Wiggin, Jerry|
|Grieve, Percy||Renton, Tim (Mid-Sussex)||Winterton, Nicholas|
|Higgins, Terence L.||Rhodes James, R.|
|Hodgson, Robin||Ridley, Hon Nicholas||TELLERS FOR THE NOES:|
|Hooson, Emlyn||Roberts, Michael (Cardiff NW)||Mr. Anthony Berry and|
|Hordern, Peter||Ross, Stephen (Isle of Wight)||Lord James Douglas-Hamilton.|
|Howe, Rt Hon Sir Geoffrey|
|Division No. 319]||AYES||[12.35 a.m.|
|Aitken, Jonathan||Hooson, Emiyn||Sainsbury, Tim|
|Baker, Kenneth||Hordern, Peter||Smith, Cyril (Rochdale)|
|Beith, A. J.||Howe, Rt Hon Sir Geoffrey||Steel, Rt Hon David|
|Berry, Hon Anthony||Johnston, Russell (Inverness)||Stradling Thomas, J.|
|Brooke, Hon Peter||Lawrence, Ivan||Tapsell, Peter|
|Budgen, Nick||Lawson, Nigel||Thorpe, Rt Hon Jeremy (N Devon)|
|Clark, William (Croydon S)||Macfarlane, Neil||Viggers, Peter|
|Cooke, Robert (Bristol W)||MacGregor, John||Wainwright, Richard (Colne V)|
|Douglas-Hamilton, Lord James||Page John (Harrow West)||Weatherill, Bernard|
|Emery, Peter||Penhaligon, David||Wiggin, Jerry|
|Freud, Clement||Rees, Peter (Dover & Deal)||Winterton, Nicholas|
|Gow, Ian (Eastbourne)||Renton, Tim (Mid-Sussex)|
|Grieve, Percy||Rhodes James, R.||TELLERS FOR THE AYES:|
|Higgins, Terence L.||Ridley, Hon Nicholas||Mr. John Pardoe and|
|Hodgson, Robin||Roberts, Michael (Cardiff NW)||Mr. Stephen Ross.|
|Archer, Rt Hon Peter||Brown, Ronald (Hackney S)||Crowther, Stan (Rotherham)|
|Armstrong, Ernest||Buchan, Norman||Cryer, Bob|
|Ashton, Joe||Butler, Mrs Joyce (Wood Green)||Cunningham, G. (Islington S)|
|Atkins, Ronald (Preston N)||Callaghan, Rt Hon J. (Cardiff SE)||Cunningham, Dr J. (Whiten)|
|Atkinson, Norman (H'gey, Tott'ham)||Callaghan, Jim (Middleton & P)||Dalyell, Tam|
|Bagier, Gordon A. T.||Campbell, Ian||Davidson, Arthur|
|Bain, Mrs Margaret||Canavan, Dennis||Davies, Bryan (Enfield N)|
|Barnett, Guy (Greenwich)||Cant, R. B.||Davies, Rt Hon Denzil|
|Barnett, Rt Hon Joel (Heywood)||Carmichael, Neil||Davis, Clinton (Hackney C)|
|Bates, Alf||Carter, Ray||Deakins, Eric|
|Bean, R. E.||Carter-Jones, Lewis||Dean, Joseph (Leeds West)|
|Benn, Rt Hon Anthony Wedgwood||Cartwright, John||de Freitas, Rt Hon Sir Geoffrey|
|Bennett, Andrew (Stockport N)||Castle, Rt Hon Barbara||Dell, Rt Hon Edmund|
|Bidwell, Sydney||Clemitson, Ivor||Dewar, Donald|
|Bishop, Rt Hon Edward||Cocks, Rt Hon Michael (Bristol S)||Dormand, J. D.|
|Blenkinsop, Arthur||Cohen, Stanley||Douglas-Mann, Bruce|
|Boardman, H.||Concannon, Rt Hon John||Duffy, A. E. P.|
|Booth, Rt Hon Albert||Cook, Robin F. (Edin C)||Dunnett, Jack|
|Boothroyd, Miss Betty||Corbett, Robin||Eadie, Alex|
|Bottomley, Rt Hon Arthur||Cowans, Harry||Edwards, Robert (Wolv SE)|
|Boyden, James (Bish Auck)||Craigen, Jim (Maryhill)||Ellis, John (Brigg & Scun)|
|Bray, Dr Jeremy||Crawshaw, Richard||English, Michael|
|Brown, Robert C. (Newcastle W)||Cronin, John||Evans, loan (Aberdare)|
|Evans, John (Newton)||Litterick, Tom||Roper, John|
|Ewing, Harry (Stirling)||Loyden, Eddie||Ross, Rt Hon W. (Kilmarnock)|
|Faulds, Andrew||Luard, Evan||Rowlands, Ted|
|Fernyhough, Rt Hon E.||Lyon, Alexander (York)||Sedgemore, Brian|
|Fitch, Alan (Wigan)||Lyons, Edward (Bradford W)||Selby, Harry|
|Fitt, Gerard (Belfast W)||Mabon, Rt Hon Dr J. Dickson||Sever, John|
|Flannery, Martin||McCartney, Hugh||Shaw, Arnold (Ilford South)|
|Fletcher, L. R. (Ilkeston)||McDonald, Dr Oonagh||Sheldon, Rt Hon Robert|
|Fletcher, Ted (Darlington)||McElhone, Frank||Shore, Rt Hon Peter|
|Foot, Rt Hon Michael||MacFarquhar, Roderick||Silkln, Rt Hon John (Deptford)|
|Forrester, John||McGuire, Michael (Ince)||Silkin, Rt Hon S. C. (Dulwich)|
|Fraser, John (Lambeth, N'w'd)||McKay, Allen (Penlstone)||Sillars, James|
|Freeson, Rt Hon Reginald||MacKenzie, Rt Hon Greg[...]r||Silverman, Julius|
|Garrett, John (Norwich S)||Maclennan, Robert||Skinner, Dennis|
|George, Bruce||McMillan, Tom (Glasgow C)||Smith, Rt Hon John (N Lanarkshire)|
|Gilbert, Rt Hon Dr John||Madden, Max||Snape, Peter|
|Golding, John||Magee, Bryan||Spearing, Nigel|
|Gould, Bryan||Mallalieu, J. P. W.||Spriggs, Leslie|
|Graham, Ted||Marks, Kenneth||Stallard, A. W.|
|Grant, John (Islington C)||Marshall, Dr Edmund (Goole)||Stewart, Rt Hon M. (Fulham)|
|Grocott, Bruce||Marshall, Jim (Leicester S)||Stoddart, David|
|Hamilton, James (Bothwell)||Maynard, Miss Joan||Stott, Roger|
|Hardy, Peter||Meacher, Michael||Strang, Gavin|
|Harrison, Rt Hon Walter||Mikardo, Ian||Summerskill, Hon Dr Shirley|
|Hart, Rt Hon Judith||Millan, Rt Hon Bruce||Taylor, Mrs Ann (Bolton W)|
|Hattersley, Rt Hon Roy||Miller, Dr M. S. (E Kilbride)||Thomas, Jeffrey (Abertillery)|
|Hayman, Mrs Helene||Mitchell, Austin (Grimsby)||Thomas, Mike (Newcastle E)|
|Healey, Rl Hon Denis||Mitchell, R. C. (Soton, Itchen)||Thomas, Ron (Bristol NW)|
|Heffer, Eric S.||Molloy, William||Thorne, Stan (Preston South)|
|Henderson, Douglas||Moonman, Eric||Tilley, John|
|Hooley, Frank||Morris, Alfred (Wythenshawe)||Tomlinson, John|
|Horam, John||Morris, Rt Hon Charles R.||Tomney, Frank|
|Howell, Rt Hon Denis (B'ham, Sm H)||Morris, Rt Hon J. (Aberavon)||Urwin, T. W.|
|Hoyle, Doug (Nelson)||Morton, George||Varley, Rt Hon Eric G.|
|Huckfielcl, Les||Moyle, Rt Hon Roland||Wainwright, Edwin (Deanne V)|
|Hughes, Rt Hon C. (Anglesey)||Mulley, Rt Hon Frederick||Walker, Harold (Doncaster)|
|Hughes, Mark (Durham)||Murray, Rt Hon Ronald King||Walker, Terry (Kingswood)|
|Hughes, Robert (Aberdeen N)||Newens, Stanley||Ward. Michael|
|Irving, Rt Hon S. (Dartford)||Noble, Mike||Watkins, David|
|Jackson, Colin (Brighouse)||Oakes, Gordon||Watkinson, John|
|Jackson, Miss Margaret (Lincoln)||Ogden, Eric||Weetch, Ken|
|Janner, Greville||O'Halloran, Michael||Weitzman, David|
|Jay, Rt Hon Douglas||Orme, Rt Hon Stanley||Wellbeloved, James|
|Jager, Mrs Lena||Ovenden, John||White, Frank R. (Bury)|
|Jenkins, Hugh (Putney)||Palmer, Arthur||White, James (Pollok)|
|John, Brynmor||Park, George||Whitehead, Phillip|
|Johnson, James (Hull West)||Parker, John||Wigley, Dafydd|
|Jones, Alec (Rhondda)||Parry, Robert||Willey, Rt Hon Frederick|
|Jones, Barry (East Flint)||Pavitt, Laurie||William, Rt Hon Alan (Swansea W)|
|Jones, Dan (Burnley)||Pendry, Tom||Williams, Alan Lee (Hornch'ch)|
|Judd, Frank||Prescott, John||Williams, Rt Hon Shirley (Hertford)|
|Kaufman, Rt Hon Gerald||Price, C. (Lewisham W)||Wilson, Gordon (Dundee E)|
|Kerr, Russell||Price, William (Rugby)||Wilson, Rt Hon Sir Harold (Huyton)|
|Kilroy-Silk, Robert||Radice, Giles||Wilson, William (Coventry SE)|
|Kinnock, Neil||Rees, Rt Hon Merlyn (Leeds S)||Wise, Mrs Audrey|
|Lambie, David||Richardson, Miss Jo||Woodall, Alec|
|Lamborn, Harry||Roberts, Gwilym (Cannock)||Woof, Robert|
|Lamond, James||Robertson, George (Hamilton)||Wrigglesworth, Ian|
|Latham, Arthur (Paddington)||Robinson, Geoffrey||Young, David (Bolton E)|
|Leadbitter, Ted||Roderick, Caerwyn|
|Lee, John||Rodgers, George (Chorley)||TELLERS FOR THE NOES:|
|Lestor, Miss Joan (Eton & Slough)||Rodgers, Rt Hon William (Stockton)||Mr. James Tinn and|
|Lewis, Ron (Carlisle)||Rooker, J. W.||Mr. Donald Coleman.|
On a point of order, Sir Myer. I beg to move, That the Chairman do report Progress and ask leave to sit again.
It seems to me, Sir Myer, at this stage of the proceedings, after a debate which has lasted for more than two hours and to which there has been a very inadequate response by the Government, and as we now have here the Prime Minister, the Chancellor of the Exchequer and the right hon. Lady the Secretary of State for Education and Science, who has travelled back especially from China for this debate and this Division, that now is the time at which the debate might usefully be postponed until next week, when there will be plenty of time in which to consider these matters in considerable detail. In view of this, it seems to me to be a very reasonable proposal at this late hour, and I move the motion in order to give the Prime Minister and others further time to consider these matters.
I am obliged to the hon. Member for Cambridge (Mr. Rhodes James). I am not prepared to accept that proposal.
I have to state that it is my opinion that the principle of clause 1 and any matters arising thereon have been adequately discussed in the course of debate on the amendment, and therefore, under Standing Order No. 48, I shall now put the Question on the clause forthwith.
(seated and covered): On a point of order, Sir Myer. You were very careful, as you will recall, to give directions to the Committee to stay closely within the rules of order on the four amendments which we debated. Your instructions were scrupulously observed and it was not, therefore, possible to go very wide or make many intricate points which arise on a proper consideration of clause 1.
I must, therefore, respectfully suggest that there must be some opportunity given to the Committee so that we can go back over clause 1 and the numerous points which my hon. Friends wish to raise. I raise this point of order in deference to the points which you made from the Chair during our debates and in view of the deference shown to your views by Opposition Members.
I am obliged to the hon. and learned Member. I referred to Standing Order No. 48. Perhaps when the hon. and learned Member learns what is in that Standing Order he will agree with my decision. It reads:
If, during the consideration of a bill in a committee of the whole House, the chairman is of opinion that the principle of a clause or schedule and any matters arising thereon have been adequately discussed in the course of debate on the amendments proposed thereto, he may after the last amendment to be selected has been disposed of, state that he is of this opinion and shall then forthwith put the question".
(seated and covered): Further to that point of order, Sir Myer. I am sitting with Standing Order No. 48 in my hand, so I am well apprised of the principles at stake. I must respectfully point out that the only matter considered in relation to the four amendments which were the subject of debate was the question of the date on which this measure should cease to have effect. It will not have escaped your attention that there is a second subsection to the clause. All that we were permitted to debate, and I make no criticism of this, was the date when the measure should cease to have effect. There are many other points of considerable significance, as was demonstrated by the number of amendments on the Amendment Paper. Whether they were in order is a different matter. I adduce that fact to demonstrate that there were more points which could reasonably have been considered by the Committee than the point which arose on the amendments. Therefore, with profound respect, I ask you to consider your earlier ruling, conscious of Standing Order No. 48 which I am holding in my hand and which you, no doubt, have under your eye.
Standing Order No. 48 confers upon the Chairman the right to put the Question if in his opinion there has been adequate discussion. My opinion was that there had been adequate discussion.
|Division No. 320]||AYES||[12.50 a.m.|
|Archer, Rt Hon Peter||Bain, Mrs Margaret||Bennett, Andrew (Stockport N)|
|Armstrong, Ernest||Barnett, Gure (Greenwich)||Bidwell, Sydney|
|Ashton, Joe||Barnett, Rt Hon Joel (Heywood)||Bishop, Rt Hon Edward|
|Atkins, Ronald (Preston N)||Bates, All||Blenkinsop, Arthur|
|Atkinson, Norman (H'gey, Tott'ham)||Bean, R. E.||Boardman, H.|
|Bagier, Gordon A. T.||Bern, Rt Hon Anthony Wedgwood||Booth, Rt Hon Albert|
|Boothroyd, Miss Betty||Hooley, Frank||Parker, John|
|Bottomley, Rt Hon Arthur||Horam, John||Parry, Robert|
|Boyden, James (Bish Auck)||Howell, Rt Hon Denis (B'ham, Sm H)||Pavitt, Laurie|
|Bray, Dr Jeremy||Hoyle, Doug (Nelson)||Pendry, Tom|
|Brown, Robert C. (Newcastle W)||Huckfield, Les||Prescott, John|
|Brown, Ronald (Hackney S)||Hughes, Rt Hon C. (Anglesey)||Price, C. (Lewisham W)|
|Buchan, Norman||Hughes, Mark (Durham)||Price, William (Rugby)|
|Butler, Mrs Joyce (Wood Green)||Hughes, Robert (Aberdeen N)||Radice, Giles|
|Callaghan, Rt Hon J. (Cardiff SE)||Irving, Rt Hon S. (Dartford)||Rees, Rt Hon Merlyn (Leeds S)|
|Callaghan, Jim (Middleton & P)||Jackson, Colin (Brighouse)||Richardson, Miss Jo|
|Campbell, Ian||Jackson, Miss Margaret (Lincoln)||Roberts, Gwilym (Cannock)|
|Canavan, Dennis||Janner, Greville||Robertson, George (Hamilton)|
|Cant, R. B.||Jay, Rt Hon Douglas||Robinson, Geoffrey|
|Carmichael, Neil||Jeger, Mrs Lena||Roderick, Caerwyn|
|Carter, Ray||Jenkins, Hugh (Putney)||Rodgers, George (Chorley)|
|Carter-Jones, Lewis||John, Brynmor||Rodgers, Rt Hon William (Stockton>|
|Cartwright, John||Johnson, James (Hull West)||Rooker, J. W.|
|Castle, Rt Hon Barbara||Jones, Alec (Rhondda)||Roper, John|
|Clemitson, Ivor||Jones, Barry (East Flint)||Ross, Rt Hon W. (Kilmarnock)|
|Cocks, Rt Hon Michael (Bristol S)||Jones, Dan (Burnley)||Rowlands, Ted|
|Cohen, Stanley||Judd, Frank||Sedgemore, Brian|
|Concannon, Rt Hon John||Kaufman, Rt Hon Gerald||Selby, Harry|
|Conlan, Bernard||Kerr, Russell||Sever, John|
|Cook, Robin F. (Edin C)||Kilroy-Silk, Robert||Shaw, Arnold (Ilford South)|
|Corbett, Robin||Kinnock, Neil||Sheldon, Rt Hon Robert|
|Cowans, Harry||Lambie, David||Shore, Rt Hon Peter|
|Craigen, Jim (Maryhill)||Lamborn, Harry||Silkln, Rt Hon John (Deptford)|
|Crawshaw, Richard||Lamond, James||Silkin, Rt Hon S. C. (Dulwich)|
|Cronin, John||Latham, Arthur (Paddington)||Sillars, James|
|Crowther, Stan (Rotherham)||Leadbitler, Ted||Silverman, jul[...]|
|Cryer, Bob||Lee, John||Skinner, Dennis|
|Cunningham, Dr J. (Whiteh)||Lestor, Miss Joan (Eton & Slough)||Smith, Rt Hon John (N Lanarkshire)|
|Dalyell, Tam||Lewis, Ron (Carlisle)||Snape, Peter|
|Davidson, Arthur||Litterick, Tom||Spearing, Nigel|
|Davies, Bryan (Enfield N)||Loyden, Eddie||Spriggs, Leslie|
|Davies, Rt Hon Denzil||Luard, Evan||Stallard, A. W.|
|Davis, Clinton (Hackney C)||Lyon, Alexander (York)||Stewart, Rt Hon M. (Fulham)|
|Deakins, Eric||Lyons, Edward (Bradford W)||Stoddart, David|
|Dean, Joseph (Leeds West)||Mabon, Rt Hon Dr J. Dickson||Stott, Roger|
|de Freitas, Rt Hon Sir Geoffrey||McCartney, Hugh||Strang, Gavin|
|Dell, Rt Hon Edmund||McDonald, Dr Oonagh||Summerskill, Hon Dr Shirley|
|Dewar, Donald||McElhone, Frank||Taylor, Mrs Ann (Bolton W)|
|Dormand, J. D.||MacFarquhar, Roderick||Thomas, Jeffrey (Abertillery)|
|Douglas-Mann, Bruce||McGuire, Michael (Ince)||Thomas, Mike (Newcastle E)|
|Duffy, A. E. P.||McKay, Allen (Penistone)||Thomas, Ron (Bristol NW)|
|Dunnett, Jack||MacKenzie, Rt Hon Gregor||Thorne, Stan (Preston South)|
|Eadie, Alex||Maclennan, Robert||Tilley, John|
|Edwards. Robert (Wolv SE)||McMillan, Tom (Glasgow C)||Tinn, James|
|Ellis, John (Brigg & Scun)||Madden, Max||Tomlinson, John|
|English, Michael||Magee, Bryan||Tomney, Frank|
|Evans, loan (Aberdare)||Mallalleu, J. P. W.||Urwin, T. W.|
|Evans, John (Newton)||Marks, Kenneth||Varley, Rt Hon Eric G.|
|Ewing, Harry (Stirling)||Marshall, Dr Edmund (Goole)||Wainwright, Edwin (Deanne V)|
|Faulds, Andrew||Marshall, Jim (Leicester S)||Walker, Harold (Doncaster)|
|Fernyhough, Rt Hon E.||Maynard, Miss Joan||Walker, Terry (Kingswood)|
|Fitch, Alan (Wigan)||Meacher, Michael||Ward, Michael|
|Fitt, Gerard (Belfast W)||Mikardo, Ian||Watkins, David|
|Flannery, Martin||Millan, Rt Hon Bruce||Watkinson, John|
|Fletcher, L. R. (Ilkeston)||Miller, Dr M. S. (E Kilbride)||Weetch, Ken|
|Fletcher, Ted (Darlington)||Mitchell, Austin (Grimsby)||Weitzman, David|
|Foot, Rt Hon Michael||Mitchell, R. C. (Soton, Itchen)||Wellbeloved, James|
|Forrester, John||Molloy, William||White, Frank R. (Bury)|
|Fraser, John (Lambeth, N'w'd)||Moonman, Eric||White, James (Pollok)|
|Freeson, Rt Hon Reginald||Morris, Alfred (Wythenshawe)||Whitehead, Phillip|
|Garrett, John (Norwich S)||Morris, Rt Hon Charles R.||Willey, Rl Hon Frederick|
|George, Bruce||Morris, Rt Hon J. (Aberavon)||William, Rt Hon Alan (Swansea W)|
|Gilbert, Rt Hon Dr John||Morton, George||Williams, Alan Lee (Hornch'ch)|
|Golding, John||Moyle, Rt Hon Roland||Williams, Rt Hon Shirley (Hertford)|
|Gould, Bryan||Mulley, Rt Hon Frederick||Wilson, Gordon (Dundee E)|
|Graham, Ted||Murray, Rt Hon Ronald King||Wilson, Rt Hon Sir Harold (Huyton)|
|Grant, John (Islington C)||Newens, Stanley||Wilson, William (Coventry SE)|
|Grocott, Bruce||Noble, Mike||Wise, Mrs Audrey|
|Hardy, Peter||Oakes, Gordon||Woodall, Alec|
|Harrison, Rt Hon Walter||Ogden, Eric||Woof, Robert|
|Hart, Rt Hon Judith||O'Halloran, Michael||Wrigglesworth, Ian|
|Hattersley, Rt Hon Roy||Orme, Rt Hon Stanley||Young, David (Bolton E)|
|Hayman, Mrs Helene||Ovenden, John||TELLERS FOR THE AYES:|
|Healey, Rt Hon Denis||Palmer, Arthur||Mr. James Hamilton and|
|Heffer, Eric S.||Park, George||Mr. Donald Coleman|
|Aitken, Jonathan||Lawson, Nigel||Steel, Rt Hon David|
|Brooke, Hon Peter||Macfarlane, Nell||Stradling Thomas, J|
|Cooke, Robert (Bristol W)||MacGregor, John||Tapsell, Peter|
|Freud, Clement||Page, John (Harrow West)||Viggers, Peter|
|Gow, Ian (Eastbourne)||Pardoe, John||Wainwright, Richard (Colne V)|
|Grieve, Percy||Penhaligon, David||Weatherill, Bernard|
|Higgins, Terence L.||Rees, Peter (Dover & Deal)||Winterton, Nicholas|
|Hodgson, Robin||Renton, Tim (Mid-Sussex)|
|Hooson, Emlyn||Rhodes James, R.||TELLERS FOR THE NOES:|
|Howe, Rt Hon Sir Geoffrey||Ross, Stephen (Isle of Wight)||Mr. Anthony Berry and|
|Johnston, Russell (Inverness)||Smith, Cyril (Rochdale)||Lord James Douglas-Hamilton.|