I very much welcome the opportunity today to talk about the Finniston report. Indeed, the fact that the Government have made time available for this debate is indicative of the importance which they attach to the subject. It is fair to say that the subject brings together a number of those who have taken a keen interest in this matter. I respect the origins of this study, stemming as it does from the suggestion of the right hon. Member for Chesterfield (Mr. Varley), and I know of the work which the hon. Member for Bristol, North-East (Mr. Palmer) has done. I also see here my hon. Friend the Member for Ripon (Dr. Hampson), who raised this question in a debate on 18 April. The subject has also been debated in another place.

As is well known, the Government have been engaged in a period of consultation which, in effect, has taken place in two parts. The first affects my own Department and concerns those matters that particularly affect industry. The second stage, for which my hon. Friend the Under-Secretary of State for Education and Science has responsibility, covers the educational aspects and relates to matters upon which my hon. Friend will comment when he replies to the debate.

I believe that this is an apposite time to debate this important subject. It is five months since the Finniston report was published. During that time, many lively views have been expressed. Indeed, many of the submissions put to the Government have been published and there has been a good deal of comment and speculation. The Government have listened carefully to that debate and have also canvassed views from the main interest groups concerned. They are now about to reach conclusions, and it was felt appropriate that at this stage hon. Members should, as it were, have the last word before those conclusions were reached, at least with regard to my own Department. As I have emphasised, my hon. Friend the Under-Secretary of State for Education and Science will listen with great interest to what is said in relation to the consultation process as it affects his Department.

It may be helpful if I briefly recap on a number of the more significant findings of the Finniston committee's report. It is a massive report. In a sense, it cannot be overstated that the report is a significant contribution to the whole future of the industry in this country. I again pay tribute to Sir Monty Finniston and his committee colleagues, who have rendered a signal service in this report. It is clear that the interest that has been aroused reflects the concern of all those who are thinking about the future of British industry.

The remit of the committee was to look at the supply, education and training of engineers. It was charged to look at the professional regulation of engineers for manufacturing industry in the light of national economic needs. In emphasising that part of its brief, the committee considered topics that many had hitherto regarded as somewhat esoteric. They demonstrated their relevance within the national concern to improve the competitiveness and efficiency of our industries.

Moreover, Finniston showed that they are not topics that can be viewed in isolation. The concern expressed over many years about the relatively low standing and rewards for engineers in Britain, especially when compared with their overseas counterparts, was of importance. The effects of that on the numbers and the calibre of the recruits to engineering must be seen as reflecting a more general feature in our society, namely, that we too readily dismiss as inferior pursuits the development and application of useful knowledge for economic ends, reserving the glittering prizes for those engaged in the purist pursuit and extension of new knowledge.

That undervaluation of what the Germans call "Technik" has pervaded our educational system, our industrial enterprises, and our social institutions. If one agrees with Finniston's analysis, as many clearly do, that undervaluation has hindered our capacity as an industrial economy, to respond rapidly and flexibly to changes in an economic environment in which technological factors are fast becoming predominant. That is the context in which the Government will consider their response to Finniston's recommendations.

Finniston has done a great service in illustrating the importance of the engineering dimension to industrial enterprise. But the Government believe, and those who made submissions to us argued strongly, that that must be regarded as one of the many things that are required for success in world markets. There are many other facets that cannot be ruled out when discussing those matters—for example, the fight against inflation, the encouragement of entrepreneurship, improving labour relations, marketing, management training. There is a whole range of issues. Some of those who argued that Finniston had ignored them were not being realistic, because Finniston never sought to argue that other factors should not be brought into play. Certainly the Government take that view. A strong engineering dimension is not a sufficient condition for success, but it is none the less a necessary one.

The problem is one of degree, not of absolutes. Despite the adverse features mentioned, Britain has produced many generations of internationally respected engineers, and continues to do so.

During the past few days I have had the opportunity to travel around the country with a Chinese Government delegation. It was interesting to find that in our shipyards they were quick to point out many of the initiatives that Britain had created in the shipbuilding industry. They recalled that the first railway in China had been built by British engineers. For those who travel around the world the tradition, heritage and skills of British engineers are evident for all to see. The irony is that the major engineering advances first made in Britain include many developments that are now being exploited by our competitors. None the less, we have many strengths on which to build. We need the marginal improvement that would restore our place in world markets.

The report has a massive, almost daunting, list of 80 recommendations for action, which the committee believed would engender an enhanced national engineering capability. The proposal that has attracted the most attention, and the one upon which so many others ride, is that which calls for the creation of a new engineering authority. I shall return to that matter later.

It would be wrong to suppose that the acceptance or implementation of the report rests solely, or even primarily, on whether the Government decide to establish a new authority. Out of the 80 recommendations, 18 are directed to the employers of engineers, and many others, including the suggestion for an engineering authority, depend on a positive response from employers. Without that response, such an authority would have little meaning. The committee was unequivocal in saying that the key to improvement in the quality and quantity of recruits into engineering, and to improving the effectiveness of the contribution made by engineers, rests primarily with employers. They determine the attractions or otherwise of an engineering career. They determine the organisation of activities within companies and the role of engineers in them. They are the only ones who can tell those who educate future and practising engineers about the skills and attributes that are needed.

The underlying aim of most of the proposals is to cause more employers to recognise that onus upon them, and to build bridges between employers and the many other agencies working to supply their needs within the engineering dimension. The Government recognise that there are a number of companies that can fairly point to successful work in that area. Some would argue that if all companies behaved in the same way the problem would disappear. Finniston has shown that there are not enough companies that can show that that is true of their position.

I turn to the Government's response. These are not problems that the Government can resolve—certainly not alone. The remedies lie essentially with employers and with those in the educational and professional sectors. In so far as the Government have a part to play, their role is one of encouraging and, where necessary, facilitating the efforts of those groups to work together. It is essential that the Government are informed about the reactions and intentions of those groups in the light of the report before they decide on their response. We have spent the past six months ensuring that that process takes place.

Many of the recommendations for Government action concern the pattern and content of the initial formation of engineers and of their subsequent training and post-experience development in employment. As my hon. Friend the Under-Secretary told the House on 18 April, those topics are to be the subject of a two-day national conference to be held in October. The organising committee for that conference has consulted widely on reactions to the Finniston proposals as an input to that debate. That, in a sense, is the "part 2" phase of the consultations that I described earlier, part 1 being the consultations that have been undertaken by the Department of Industry.

Recommendations upon which attention has been concentrated in the meantime concern the engineering authority and the functions envisaged for it by Finniston. As I told the House on 24 March, in reply to a parliamentary question, the Department of Industry has sought views from about 370 institutions, companies and other organisations on those questions. Other Departments have canvassed opinion among the bodies in their respective areas. Many unsolicited views were received from individuals, organisations, and hon. Members. In addition, my right hon. Friend the Secretary of State and I have met many of the key bodies, and we shall continue to do so.

That adds up to a comprehensive consultation exercise within the time scale that we set, originally for 1 April. I was grateful to all those who endeavoured to meet that time scale, because it was a relatively short one. We had to balance the argument between those who wanted the momentum maintained and those who required time for consultation. Because of the nature of some organisations, some found that, with widespread constituency interests, the process took longer than they had hoped. We allowed some leeway after 1 April to those involved in that process, such as the Confederation of British Industry and the Engineering Employers Federation. We also received some revised or amended views from a number of those who wrote to us by 1 April.

I turn to the responses themselves. Finniston has clearly stimulated intense debate, not only within professional institutions and academic circles but, more significantly, within industrial companies, among employers, and trade union organisations. The report has won strong general welcome. Despite fundamental reservations from some about specific aspects of the prescriptions, there is widespread agreement about much of the diagnosis. Certainly the Committee's diagnosis of the engineering dimension has been widely endorsed. Attitudes to the broad objectives for change identified in the report have similarly been positive for the most part, and one can discern a clear enthusiasm for seeking improvements on those lines and a willingness, above all, to be involved in that task.

It is at the level of specific actions that opinions have been much more divided. Views differ, for example, on whether the changes to be sought need to be as radical as Finniston suggests or whether it would be just as fruitful and, some would argue, less disruptive to rely on the strengths of the current framework to extend the positive trends that Finniston recognises. No one would deny that such strength exists and that there are a number of encouraging trends—for example, in industry-academic collaboration. On the other hand, the problems identified by the report have dogged us for many years, and persist, despite a number of initiatives to redress them over the past century. Therefore, it is fair to ask whether something more is required.

That something more, in the view of the Finniston committee, should take the form of a new engineering authority, which should be a focus for the efforts of other groups to improve the standards and relevance of engineering formation and practice and should generally agitate for improvements in the engineering dimension. Without in any way denigrating the valuable efforts of the many people who have been working to these ends in companies, professional institutions, academic engineering departments and other bodies, Finniston argues that their activities would be more effective if they were better related together within a national framework with a commonly agreed set of priorities.

This broad conclusion has been supported by the majority of respondents to the report, although with scepticism on the part of some. Although the tenor of many responses has been that a new body would face formidable problems and would by no means be assured of success, the general view is that without some institutional focus of this kind the good will and momentum for change that has been generated is likely to be dissipated, and may be difficult to recover.

Within this broad view we have received a plethora of conflicting detailed proposals for the constitution of a new authority. Finniston proposed a body of between 15 and 20 people selected by the Secretary of State to reflect the balance of interests among employers, educationists and the profession, with funds voted—initially at least—by Parliament. Most respondents agreed that this was an appropriate size for the body and that its members should serve in an independent capacity, but clearly many had reservations about the appointments being made by Ministers and proposed instead that the Privy Council should take on this role. That would be a novel departure for the Privy Council, but it will be among the options being explored by the Government. Yet again, others believe that existing institutions would be able to create the necessary body. Opinions vary considerably about the appropriate balance of reprsentation on a new authority.