Local Government (Direct Labour)

– in the House of Commons at 10:16 pm on 18th July 1983.

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Photo of Dr David Clark Dr David Clark Shadow Minister (Business, Innovation and Skills), Shadow Spokesperson (Education) 10:16 pm, 18th July 1983

I beg to move, That an humble Address be presented to Her Majesty, praying that the Local Government (Direct Labour Organisations) (Competition) Regulations 1983 (S.I., 1983, No. 685), dated 5th May 1983, a copy of which was laid before this House on 9th May, in the last Session of Parliament, be annulled.

We are asking the House to annul Statutory Instrument No. 685. It is a mean little instrument which does the Government no good and is not worthy of the House. It was introduced ostensibly in the name of efficiency and competition, but it has little to do with either. It has all to do with rewarding the Government's friends.

The Government have many unpleasant aspects to their general approach but many of us find most reprehensible their approach towards public servants, whether they are in national Government, local government or the National Health Service. The men and women who work in these services have been denigrated by the Conservative party to an unthinkable degree. The instrument is one further attack on those who work in the public service and who provide us with essential services.

As I have said, the order has little to do with efficiency or good management. It has been introduced as a reward for the Government's financial friends, who have supported the Government loyally, well and generously over the past few years. It is a reward for financial donations to the Tory party. It is the return to such companies as Tarmac, which made a £13,500 donation to the Conservative party, to Taylor Woodrow, which gave £29,060, and to Wimpy, which could chip in only £25,000. Those firms and others are now getting their reward.

I realise that this is a contentious area and I accept that I must substantiate my claims. The instrument is an unashamed attack on the direct labour organisation in local government and I am prepared to make an equally unashamed defence of the direct labour organisation.

The instrument stems from the Local Government, Planning and Land Act (No. 2) 1980 and is the third tranche of measures to restrict the work of direct labour organisations. Each tranche has been more severe than its predecessor. The two previous measures have proved costly in terms of finance and manpower and I submit that the instrument has been introduced with insufficient evidence and background information.

Ostensibly the instrument tackles three areas. First, it provides that 60 per cent. of all new building works below £50,000 should go out to tender. The Opposition cannot understand why it is necessary to introduce such a measure. We know that 90 per cent. of that type of work, which is mainly council house building and at a low level of activity, is already carried out by the private sector. There is no need for the private sector to receive any further help.

This scheme is extremely costly. We can calculate from the direct labour organisations' reports for 1981–82 that the previous two sets of regulations have added about 7 per cent. to the overall cost of building. These costs are borne not by the private contractors but by the ordinary ratepayers. It is an overhead that goes on to the rates. The new regulations will mean an additional cost of about 10 per cent. It is preposterous that, when the Government are talking about cutting public expenditure, they are adding to public expenditure for no reason.

The regulations also deal with maintenance jobs below £10,000. About 60 per cent. of that work must be put to open tender.

Photo of Mr Alf Morris Mr Alf Morris , Manchester Wythenshawe

Is my hon. Friend aware of the extent and excellence of the Manchester direct works department's achievement in housing maintenance? Is he aware that it has saved Manchester ratepayers large sums of money by the work that it has undertaken? What does my hon. Friend feel about how the regulations dealing with house maintenance will affect one of the finest works departments in the country?

Photo of Dr David Clark Dr David Clark Shadow Minister (Business, Innovation and Skills), Shadow Spokesperson (Education)

I am aware of the history of the direct works department in Manchester, its excellent overall management service and the service that it has provided to Manchester in general. I am happy to pay tribute, not just to this department, but to many other direct works departments that provide an equal service in Sheffield, Tyneside and other places.

When we talk about housing maintenance we talk mainly about repairs. These are sensitive issues that need to be handled with a great deal of care and, often, speed. The regulations will make it more difficult to undertake this difficult task. We believe that it runs directly counter to the suggestions of the Department of the Environment for estate-based offices with a combined repair and rating function. We feel that this will undermine seriously a good approach to this problem.

Housing maintenance is affected, not just by delays but by the quality of work. Evidence from local authorities suggests that where maintenance work has been won in competition many contractors have been unable to meet the levels of services or the standard or quality of work required. A considerable proportion of the lowest tenderers are prevented from submitting tenders because of the poor quality of their work. I know from experience that there has been a great deal of poor workmanship by private contractors. Probably many hon. Members know of firms that are debarred from tendering for local authority work because of their cowboy attitudes.

The regulations deal not just with housing and construction but with the highways. It is amazing that the Department has brought this subject forward tonight because all the evidence at its disposal shows how foolhardy this proposal is. A survey carried out by the Department of Transport shows that this proposal does not make sense. The previous highways regulations alone have created an additional 202 administrative jobs. The Department's figures show that the new proposals require an extra 219 staff. Overall there will be an extra 421 jobs. Not a single inch of extra road will have been built or an extra manhole filled — this is purely an administrative and organisational matter.

Instead of putting men in at the sharp end, the Government will make them redundant and increase administration. We believe that that does not lead to efficient road building or repairing and is retrogressive. We do not oppose the regulations for those reasons only. We argue that the contract prices of private contractors do not have a good record, as the Government's survey shows. My information is that private contractors' contracts have an outturn cost of 4·4 per cent. over the tender prices. Direct labour organisations' costs are not 4 per cent. or 1 per cent. over, they are 0·2 per cent. under the tender prices. Direct labour organisations stick to their contract prices more vigorously and fairly than private contractors.

Although I realise that winter maintenance, repairs and emergency repairs to the highways are not covered by this statutory instrument, running down the direct labour areas of highways departments will denude many highway authorities of staff so that they will not have adequate staff for winter emergency maintenance.

The Government are putting the lives of a great many people at risk by insisting that this statutory instrument goes ahead. I hope that I have shown briefly but conclusively that these regulations are inefficient and costly to the public purse. Direct labour organisations have been put deliberately at a disadvantage. I am not surprised by that because the Conservative party has shown no liking for them.

I find the Conservative party's attitude shocking. I have a letter written by the Tories at county hall during the 1977 election campaign. Sir Kenneth McAlpine wrote to the GLC Tory party on behalf of Wates, McAlpines, Taylor Woodrow, Marshall-Andrew and many others. The Tory party replied: direct labour will be awarded construction contracts only where there is no choice—for example, when a contractor is forced to withdraw and no commercial alternative is available. We will also seek to develop commercial interest in maintenance work. The statutory instrument we have before us honours the reprehensible political pledge made in 1977. The Government are acting most reprehensibly tonight. They are waging a political vendetta against the public service. They have lowered the quality of public life. They are opposed by the local government organisations — the AMA and the Conservative-controlled Association of County Councils. I hope that the House will see the logic of my argument and treat these regulations with the contempt that they deserve.

Photo of George Young George Young Parliamentary Under-Secretary (Department of Environment) 10:28 pm, 18th July 1983

Today's prayer has the same inevitability as the next performance of "The Mousetrap". Every year Ministers lay regulations before Parliament which will make direct labour organisations compete more and so help make them more efficient which, as a result, benefits the hard-pressed ratepayer. Every year a prayer appears on the Order Paper signed by Socialist theologians and apologists for the Association of Metropolitan Authorities. Tonight, the 1982 speech has been dusted off and trotted out again.The outburst by the hon. Member for South Shields (Dr. Clark) is largely irrelevant because he is attacking not the amended competition regulations before the House but regulations that appear only in his fevered imagination. He has accused the Government of attempting to destroy not only council DLOs, but public service itself. He has had to pretend that our modest regulations are meant to achieve far more than they set out to do.

As my hon. Friends will recognise, we have heard an emotional attack on a sensible and realistic package of proposals. These were produced only after we had considered the evidence of local council 1981–82 DLO reports — these reports, incidentally, being part of the new accountability required of DLOs by our legislation — and after consultations with the local authority associations and other interested organisations. My hon. Friend the Under-Secretary of State for Transport also carried out a special investigation into the effect of the reduced £50,000 threshold for 100 per cent. competition for highways works, introduced last October, on highway costs and on winter maintenance operations.

Labour Members see—or rather pretend to see—our regulations as an attack on DLOs. In this they are briefed by the Association of Direct Labour Organisations, which claims to represent some authorities with large DLOs. The then convenor of the association made its objectives quite clear when, according to the Municipal Journal, he said: We mean to obstruct the new laws every inch of the way —that's what we are all about". The regulations are not an attack on DLOs. Good and effective DLOs have nothing to fear from competition or openness. In 1975, the then Under-Secretary in my Department said that the efficiency of the direct labour departments would be tested in competition with private contractors. That is what these regulations do.

Labour Members do not know whether to claim that DLOs are so wonderfully efficient that they do not need to compete, or are so shaky that the slightest breath of fair competition will produce their immediate collapse.

It might be helpful if I remind the House of the origin of the legislation. Much of its content was originally recommended in a 1975 report by the Chartered Institute of Public Finance and Accountancy, an estimable organisation representing public sector professionals. The basic themes of efficiency, accountability and competition were repeated, if with some different emphasis, in the 1978 report of the working party on DLOs, which was set up by the right hon. Member for Brent, East (Mr. Freeson). That, too, emphasised the importance of competition.

Many DLOs have already benefited from competition and accountancy regimes which we introduced in April 1981, and which we are now further strengthening in the 1983 regulations.

Since we introduced the new regime, there has been a 10 per cent. reduction in the DLO work force, from 152,000 to 134,000 in about 18 months. Over three quarters of DLOs in England are achieving the prescribed rate of return on capital in 1981–82. There has been higher productivity, the selling off of surplus assets, less top-heavy bureaucracy, and real cost consciousness. For example, the London borough of Camden has halved its DLO work force from just over 1,200 to just over 600.

In view of what the hon. Member for South Shields has just said, I shall quote what some people who run the DLOs have said in the reports that we have just received. South Tyneside, in the hon. Member's constituency, said: One measure of efficiency is to win contracts in competition. A Norwich city councillor said: It is only proper that a DLO should give and be seen to give value for money to the local authority. Another district's new bonus system for painters boosted productivity by 30 to 40 per cent. Another county council is disposing of six depots as part of its rationalisation programme.

DLO managers say that our legislation has enabled them, for the first time, to manage, instead of being at the mercy of spendthrift councillors and militant unions. For example, the Municipal Journal for January 1983 said: Let us learn from the experiences of the last 18 months and seek to ensure that never again will we allow the services for which we are responsible to become in poor heart or inefficient for whatever reason. At a seminar this month on highway construction and maintenance it was said that a more commercial attitude is now being taken. The tighter management controls which have been established are beginning to show signs of financial benefit. The 1981–82 north Devon DLO report announced that the Works Manager is showing alarming signs of enjoying the challenge of his new position. The 1983 regulations will do three things from 1 October. They will require about 60 per cent., instead of about one third, of local authority maintenance and new building work, below the continuing £10,000 and £50,000 thresholds for 100 per cent. competition, to go out to tender; they will require about 30 per cent. of highway works below the continuing £50,000 threshold to go out to tender, as against none at present; and they will make clear how a council should assess whether a particular job should go out to competition. That is all that we propose, yet that led to the emotional outburst of the hon. Member for South Shields.

The thresholds above which all work must go out to tender remain unchanged. We are simply increasing the percentage of work below the threshold that has to go out to tender.

Our proposals for more competition for new building and maintenance work went out to consultation last December and we published our conclusions last March. So the 1983 regulations should not have come as a surprise.

The reasons for the increased competition for building works are straightforward. We believe that DLOs, their parent authorities and ratepayers benefit from increased competition. We also believe that that competition will not be achieved unless it is required by law. The 1981–82 DLO reports show that many authorities required their DLOs to compete for lottle or none of their maintenance work below the £10,000 threshold.

The city of Manchester has been mentioned. The city's DLO was awarded 98 per cent. of the council's maintenance and highway works for 1981–82 without any competition. It is defensive of Manchester Members to be so worried about the regulations. It is worth noting that Manchester's DLO work force has been reduced from 4,300 to just over 3,000 since our legislation came into operation.

Photo of Mr Alf Morris Mr Alf Morris , Manchester Wythenshawe

The hon. Gentleman sneers at Manchester's direct works department, but will he at least acknowledge that, in employing apprentices at a time of mass youth unemployment and in trying to find jobs for disabled people, the department has given a humane lead to the rest of the building industry?

Photo of George Young George Young Parliamentary Under-Secretary (Department of Environment)

The private sector faces the same obligations in the training of apprentices and employing disabled people.

I assure hon. Members that the alternative competition-free allowance of £300,000 in a full year for works of maintenance will remain. That is of particular value to authorities with small DLOs.

Hon. Members should be aware that the amount of highway work that many highway authorities gave to their DLOs after competition in 1981–82 was derisory. A report prepared by the Federation of Civil Engineering Contractors which analysed councils' DLO reports in 1981–82 concluded that only 2·5 per cent. of authorities' highway works went to DLOs after competition. some counties in England did not require their DLOs to compete at all. that evidence came from their own DLO reports.

There have been arguments about DLOs' need to create sufficient work to keep their winter maintenance work forces employed during the rest of the year — winter maintenance work itself being, of course, still exempt from compulsory competition. But many authorities already manage to do their winter maintenance and to put a high proportion of work out to contractors—often over half.

An authority that already awards about 30 per cent. of its highway work to contractors will not be compelled to go out to competition by the new regulations, though I hope that it would do so in the interests of its ratepayers and electors. There is a limit to which we can let the winter maintenance tail wag the highways work dog.

We are producing an explanatory circular, which we aim to issue before the end of this month. It will provide authorities with guidance on the regulations. They are to some extent complex, because they must have legal certitude. However, the Opposition should not pretend to be unaware that a major reason for the complexity of the regulations is that a minority of authorities search for every legal loophole and crack in the legislation to featherbed their DLOs and keep them away from competition, by, for example, giving the DLO a chance to retender in the knowledge of contractors' bids, and by imposing unnecessary and irrelevant requirements on contractors.

The regulations provide explicitly that a job should not be regarded as exempt from competition because the value of each of the descriptions of work within it — for instance, highways and sewerage—does not individually exceed the relevant tendering threshold.

Photo of Mr Martin Flannery Mr Martin Flannery , Sheffield, Hillsborough

Will the Minister make his point more clearly? When he is making such accusations, can we have chapter and verse of where the problems have occurred? For instance, did they occur in Sheffield or in Manchester? Will he give us some of the evidence?

Photo of George Young George Young Parliamentary Under-Secretary (Department of Environment)

There have been problems in one town in Wiltshire, where work was awarded to the DLO after there had been competition. After the private sector prices were known, the DLO had an opportunity to retender. That is one of the loopholes that the legislation seeks to close.

Complexity springs not from any wish of the Government but from the behaviour of a few authorities. The regulations are confined to the competition requirements. We have not changed any other part of the DLO regime; not the rate of return on capital, nor the annual report directions requiring various information to be included in the reports in the interests of greater accountability. We have not laid down the law on methods of estimating, nor the shape and content of the DLO accounts. We are leaving authorities as free as possible to implement the DLO legislation in the way that suits them best. Competition is where many councils have fallen short. That is where we have to concentrate our efforts.

I make no apology for the new competition regulations. Competition is particularly effective as a direct means of checking efficiency, which is why some Opposition Members dislike it so intensely. Nor can I accept the allegations that more competition links with extra costs. Any additional costs should be more than offset by the keener prices that can be obtained, from both DLOs and contractors, by putting work out to tender. If DLOs are cheaper and more efficient, they will win in competition. Some do already. If they are not, local authorities—not the bureaucracy, but the electors and ratepayers who pick up the £2 billion tab for DLO work — will get the job done more cheaply.

It is not surprising that Opposition Members should object to the competition regulations. They always do. Their definition of equality is evidently the Orwellian one. Some are more equal than others, and DLOs should be more equal than contractors.

The regulations are necessary. Without them there will not be the increased competition for some of the great mass of minor maintenance and highways work that we wish to see. The benefits from competition are self-evident. For instance, the limited information that is available about the savings from accepting the lower tenders put in by the private sector for highways work suggests that the saving was about 10 per cent.

Our approach to DLOs is, therefore, unchanged. It is that they should be, and be seen by their electors and ratepayers to be, efficient. One of the most direct and efficient means of testing DLOs' efficiency is through open competition with the private sector over a broadening range of their work.

The 1983 competition regulations will help to achieve that objective. I commend them accordingly and invite the House to reject the prayer against them.

Photo of Mr Stuart Holland Mr Stuart Holland , Vauxhall 10:43 pm, 18th July 1983

The Minister addressed the House as if he were informing it. In fact, he has not argued the case at all.

On costs, for example, it is not enough for the hon. Gentleman to say that there will be a 10 per cent. advantage assumed from competition. Will he answer both the points put by my hon. Friend the Member for South Shields (Dr. Clark) in terms of the outturn costs where the private sector overruns and direct labour departments have consistently underrun estimates? How does he answer the fact that the estimated costs for the new requirement of 30 per cent. tendering will be £5·4 million—£4·7 million for England and £0·7 for Wales, resulting in the employment of 398 extra administrative staff—345 in England and 53 in Wales?

That not only amounts to an increase of that very type of white collar staff that Conservatives choose, and are even pleased, to call bureaucracy, but represents about 25 per cent. of the value of work estimated to be transferred to the private sector. What is the point? Where is the 10 per cent.? We are talking about increasing administrative costs by 25 per cent. I am perfectly happy to see some people put back to work, but I would prefer to see them put back either into productive work or into the social sector rather than simply in the scrutiny of work going out in this case to the private sector on terms welcome to the Government Front Bench as the Tory party pays off its friends.

The tragedy is that it is worse than that. Behind the advantage to the property lobby from having access to a larger share of the contracts there is a certain economic philosophy — if here we must give credit to the Government. It is the philosophy of privatisation —precisely what we discussed earlier today in respect of telecommunications. It is the importer conviction of this Government — from Austria through Freidrich von Hayek—that state is bad and private is good. There is a positive crusade to roll back the frontiers of the state and unleash the forces of the private sector. There is no analysis of the internal efficiency of direct labour organisations. No economic audit of them has been undertaken. It may be that at some time in the future we shall be given it, but we have not had it today. It simply implies that the public sector is wasteful and that the private sector is profitable, without recognising the circularity of income generated through public expenditure and passing through direct labour departments.

The Minister was snide about the analysis by the Association of Metropolitan Authorities and the Association of County Councils, but as yet he has not answered their argument. The questionnaire which they put out on these proposals, as they say, makes it difficult to understand the purpose of the regulations at all. Fifty per cent. of all highways work is already carried out by the private sector. Obviously, direct labour organisations have a greater relevance to the smaller jobs, but even there 25 per cent. of all jobs under £50,000 are carried out by the private sector. When one takes into account that very nearly half the value of work carried out by the DLO actually finds its way into the private sector through the purchase of materials … and plant hire, the actual scope of the private sector is further increased. It is called the multiplier effect. It is a simple fact that public spending generates income and revenue in the rest of the economy.

The Minister may find this puzzling. But I am not sure. I think that he is embarrassed to have to stand at the Dispatch Box and read out all this garbage without believing it. The hon. Gentleman is really quite intelligent. Unlike some of his right hon. and hon. Friends, he understands Keynesian economics and public expenditure rather than simply assuming that it is a load of nonsense.

Unfortunately, the Chancellor of the Exchequer does not appear to have the same understanding. I put a parliamentary question to the right hon. Gentleman last week asking what estimates had been made of the income-generating effect in the private sector of public spending. I got the bland reply, which I had half expected, that the Government did not undertake such estimates. Of course they do not undertake them. If they did, they would knock a hole through the philosophy of privatisation. If they had to start estimating the generation of income in the private sector from public spending through public enterprise agencies and municipal agencies such as direct labour departments, they would undermine the basis on which they are seeking to roll back the frontiers of the state, Ronald Reagan-style.

There is a case in point in council housing, and the pressure to give the private sector elbow room and take the burden of the state off the private sector. The facts are that direct labour departments in Scotland in recent years have been responsible for only 3 per cent. of council house construction, direct labour departments in England and Wales for only 7 per cent. and direct labour departments in the Greater London area for only 13 per cent. Does that mean that they are dominating the market? Is it really the burden of municipal public enterprise which is responsible for the crisis in the housing sector? It is not. It is the monetarist policies pursued by the Government, the cuts in the housing investment programme and the way in which they have pulled the rug from under the feet of private sector constructors which are responsible for the housing crisis.

Those very Rotarians and little business men were told during the election, as they were in the last, "We will cut your tax burden." They cheered the Prime Minister, forgetting that before the tax burden is reduced the first cuts come in the council house construction sector—the cuts in public spending which by themselves are unemploying those same small business men. It is the small builders, the Rotarians and local Conservative association subscribers, quite apart from the Wimpeys and the Laings, who have been undercut by the Government. They have had high interest rates wrapped around their necks and they have just been given the drop — the equivalent, despite the vote which, in the view of many hon. Members, went the right way last week, of capital punishment.

They have been given the drop by the Government's economic policies. They have been bankrupted by them. That is why they are bringing pressure to bear on the Government. That is why they come along and say that the housing sector is in crisis; they are not making money any more and there is no upturn or light at the end of the tunnel. They ask why the Government do not do something about DLOs; why they cannot have a little of what the DLOs are making in a shrinking market; why the Government do not look after them—their people.

That is the argument behind what the Minister is saying. That is what is behind all his pomp and fantasy about philosophy. The reality is that the Government are serving their bigger friends in highway construction and their smaller friends in the council house building sector by this attack on DLOs.

Photo of Mr Keith Speed Mr Keith Speed , Ashford

I have listened to the hon. Gentleman's great flow with considerable interest. Does he believe that DLOs should be as efficient as possible? If so, by what yardstick should their efficiency be judged?

Photo of Mr Stuart Holland Mr Stuart Holland , Vauxhall

I am glad that the hon. Gentleman asked me that, because it brings me to the next point that I want to make. However, before I come to that—No, I shall come to it directly. The point in question is efficiency. Efficieny by what standard?

Photo of Mr Stuart Holland Mr Stuart Holland , Vauxhall

Cost-plus and cost-minus. In many cases in the private sector firms that tender for contracts find that they cannot maintain their cash flow adequately, fail to meet specifications, do a shoddy job and then vanish. They go bankrupt. I can give the hon. Member for Ashford (Mr. Speed) one clear example. In a previous debate I mentioned the case of the Ethelred housing estate in my constituency, but, for some reason, the Minister forgot to deal with it in his reply. The estate was undertaken by the then Conservative Greater London council. The private contractors faced financial difficulties on the contract and skimped on the specification for the floors in several blocks of flats. As a result, the floors turned from concrete into sand. Many of my constituents, no doubt like many of us, would like to spend their retiring years on a beach, but not in their front rooms. When those floors turned to sand they became infested; the furniture sank into them; they created a health hazard for children and it was incredibly costly to tackle the problem, which was the fault of private contractors.

The hon. Gentleman asks what is the efficiency standard. When one turns round on the cost-plus basis to look for the private contractor to bring him to court to make him pay for the social costs of his failure, the hardship which faces so many people, and the misallocation of public resources, he has gone. He is bankrupt. He is not there to be sued any more. If Conservative Members imagine that we have such a flourishing construction industry under the Government's policies and that firms are not going bankrupt, they should open their eyes and their ears. We have never had such a rate of bankruptcies in the private construction sector as under the Government, which is another reason for the regulations.

If the Government only try to reallocate a larger share of a shrinking market to their friends they will fail both their friends and the people whom they should really serve. We are now putting down on roads chip tar which melts, becomes unusuable and causes traffic jams. As a result of public expenditure cuts, asphalt is not being used. The Government are trying to roll back the direct labour departments in order to make more room for the private sector and their private sector friends.

There is only one solution for the construction industry — to get construction going again. The cuts are a bottomless pit — the deeper one digs, the deeper one goes. If Ministers will not wake up to that, I hope that Government Back Benchers will and that they will listen hard to their side —the employers in the construction industry who realise that the Government's policy is a disaster which is no good to the industry and no good to the people whom it serves. The pathetic, sordid document that we are discussing is only a symptom of the Government's failure to address themselves to the real issues and to bring real proposals to the House.

Photo of Mr Robert Jones Mr Robert Jones , Hertfordshire West 10:55 pm, 18th July 1983

I was glad that the Minister traced the roots of the regulations back to the legislation mooted by the Labour Government and to the document produced by the Chartered Institute of Public Finance and Accountancy, which began it all. What caused it to come out with its report was a long string of scandals in direct labour organisations throughout the country, the most prominent of which was the loss of 1 million bricks by the Lambeth direct labour organisation.

I was glad that, when the Conservative Government began their first period of office, they produced a document suggesting how direct labour organisations should be controlled. That set out to achieve two objectives—to test direct labour organisations in fair and in frequent competition.

The evidence from the first direct labour organisation reports shows that neither of those objectives had been achieved. My hon. Friends are, therefore right to advance further legislation. Frequency of competition may be judged by the fact that over £400 million worth of highway work was awarded to direct labour organisations and only 21/2 per cent. of that was won in competition. That is not satisfactory and I am not surprised that the Government have had to propose amendments.

As for fairness, a string of direct labour organisations have tried to nobble the private sector to support their friends. Some have been more notorious than others. I remember when Lothian regional council made it compulsory for those coming on to its tender list to disclose political contributions. That was withdrawn when it found that the largest political contribution was from the Co-op. Other extraordinary events include the performance by the London borough of Southwark, which struck Tarmac off its tender list because it was a contractor at Greenham common. I noted that it did not strike off British Telecom, which, among others, was also a contractor there, but arbitrariness is true of Socialism at least as much as inefficiency.

Many activities have been dealt with in legislation including the Employment Act, but many injustices remain. I hope that the Minister will emphasise what remains to be done to ensure that Socialist authorities do not continue unfair discrimination. The one thing that this legislation is not about is where the frontier is or about allocating work. It is about how to determine where the frontier is. That can be done only by open and fair competition.

Photo of Mr Robert Litherland Mr Robert Litherland , Manchester Central 10:59 pm, 18th July 1983

My hon. Friend the Member for South Shields (Dr. Clark) was accused of being emotional. I think that he was being factual. It is clear that the Secretary of State is extending Government policy on privatization, using the same ploy as other Ministers, and arguing that it is in everyone's interests. This proposal is said to be in the interests of the victims—the direct labour organisations. To make them more competitive and accountable seems good, but the real intention is to destroy direct labour. The emphasis this time is on competition. The Government are laying down the rules and regulations that will eventually run down the activities of the direct labour organisations. The Government are crying crocodile tears about fair competition, but they know that DLOs cannot compete with the private sector. The reason is that we are not comparing like with like. The DLOs are confined by law to tendering for work within the boundaries of their local authorities. They cannot tender throughout the length and breadth of the country. The private sector now wants to take over even the small percentage of work that is done by the DLOs.

Photo of Mr Robert Jones Mr Robert Jones , Hertfordshire West

The DLOs have a guarantee of being on every tender list, and a guaranteed monopoly of that portion of the work that is not subject to compulsory competition.

Photo of Mr Robert Litherland Mr Robert Litherland , Manchester Central

It is not correct to say that the DLOs have the right to appear on every tender list. In Manchester, the abominations that resulted from contracts negotiated by the private sector have now been demolished. That persuaded us of the worth of direct labour.

DLOs work under principles and disciplines that are entirely different from those of the private sector. They are obliged to work under local authority rules and committee procedure. DLOs canno hire and fire at will. They have to work to the best safety, health and welfare regulations.

Apprenticeship training, which is vital to the industry, is now so neglected that before long, we shall have no craftsmen at all. In the past, such training was provided by direct labour. In Manchester 500 apprentices would be taken on at any one time in 27 different trades. In 1979 there was an intake of 150 to 180 apprentices. Last year the intake was 30. That demonstrates the demise of direct labour. DLOs have to employ their quota of disabled people too. All those costs have tc be borne by the departments. One is not, therefore, comparing like with like.

DLOs provide service cover 365 days of the year. They provide emergency services, and work anti-social hours in anti-social conditions. In every debate that we have had on direct labour, the service element has been overlooked.

Under the guise of assisting the DLOs, the regulations will put more nails in their coffin. These amendments to the maintenance and minor works activities are being made at a time when DLOs are still trying to absorb and to restaff to cope with the changes previously imposed by the Government. The regulations can only lead to loss of work, because of competition, and a farther loss of jobs. In 1979 there were more than 5,000 operatives in Manchester. Today, there are fewer than 3,000.

The process of running down the DLOs began in 1979. The irony is that extra staff will be required for administration and supervision, and the Government know that it will be impossible to obtain personnel with suitable technical qualifications in such a short time. Staff will be required to evaluate the cost and administration of the new regulations, and there will be an additional cost to a local authority in carrying out the supervision and inspection. That is what the AMA and the Association of Direct Labour Organisations are trying to impress on the Government.

Since they took power in 1979, there has been a concerted effort by the Government and the private sector to eradicate the direct labour organisations. Capital works were the first in the line of attack when the Government forced direct labour organisations to tender for all major contracts. Then came minor works. Soon the threshold of £50,000—wnich is a joke—will become irrelevant, and all work in the minor works section will have to be gained in competition.

Photo of Mr John Heddle Mr John Heddle , Staffordshire Mid

The hon. Gentleman has just said that the £50,000 threshold is a joke. Does he agree that direct labour organisations are making a joke of it? Are they not breaking up contracts into smaller components? For example, where they cannot enjoy a monopoly over £10,000, they are breaking up £100,000 contracts into 10 or 11 smaller contracts of £9,999. Does the hon. Gentleman agree that DLOs themselves are making a joke of such thresholds?

Photo of Mr Robert Litherland Mr Robert Litherland , Manchester Central

If direct labour organisations are doing that, it just shows that they are fighting for survival.

Photo of Mr Robert Litherland Mr Robert Litherland , Manchester Central

I shall not give way. I shall come to that point later.

The maintenance that has always been the prerogative of DLOs and local authorities will go out to tender. The first maintenance jobs to go out to tender will be the cream. They will include the reroofing and rewiring of estates, and programme repairs, painting and joinery. All the lucarative sections will be hived off to the private sector. The residue is already being attacked in the Housing and Building Control Bill. Indeed, the hon. Gentleman knows that, because he and I served on that Committee. All the repairs will be hived off to cowboys at the expense of local authorities and council tenants.

The regulations tighten the thumbscrews on DLOs. Why are the Government sticking to £50,000 for new construction, £50,000 for general highway work, and £10,000 for maintenance works? Those figures were relevant in the late 1970s. They have never been index-linked to the higher cost of materials, labour or inflation. The Government's idea is to keep the thresholds low so that more work has to go out. That is the answer to the hon. Gentleman's question.

The regulations are a further restriction on the functions of direct labour organisations, so that the Government's friends in the private sector will eventually have no competition and will be given an open cheque. Lump labour will be reintroduced on a very large scale. Trade union pay norms can be undermined — all to the advantage of the private builder and private profit. The Tory doctrine is that there is no room for municipal enterprise, especially if it is successful and affects profits.

The Local Government, Planning and Land Act also gives the Secretary of State supreme power to close a section, or the whole of a department if he deems that it lacks the appropriate efficiency and productivity, and if it does not make a return of 5 per cent. on capital. It should be for the local authority to say whether it wants a direct labour organisation. It is for the electorate to vote it out of office if it is not satisfied. It is not for the Secretary of State to use undemocratic tactics to ensure that DLOs cannot exist. That is the Tory interpretation of democracy. That is why the Secretary of State refuses to meet representatives of the Association of Direct Labour Organisations and to listen to the problems. That is why there has been no real in-depth discussions with the local authorities. If the Government annihilate direct labour organisations, the ratepayers will suffer. We had experience of this sort of thing in Manchester when the Tories took control. After a two-year inquiry, the Tories came to the conclusion that the DLO was giving value for money. The Government want DLOs out of the tendering procedure, so that the private sector can be given a free hand, bringing with it the price rings and cartels.

We do not have a hope tonight of convincing the Government that there is such a thing as a viable municipal enterprise. Their sole intention is to smash direct labour organisations, because they have become a thorn in the side of the private builders who contribute so much to the Tory coffers.

Several Hon. Members:

rose

Photo of Mr Paul Dean Mr Paul Dean , Woodspring

Order. I remind the House that the debate must end at 11.30 pm. and a number of hon. Members are hoping to catch my eye.

Photo of Mr Richard Alexander Mr Richard Alexander , Newark 11:11 pm, 18th July 1983

This has been an interesting debate, and has shown the great divide between Conservative and Labour Members about the way the country should be run and how local government should operate. I start from the basis that I believe unashamedly in the value of private enterprise — not only to the entrepreneur but to the unemployed. We shall never reduce the huge unemployment figure unless we encourage private enterprise. However, that is not the subject of the debate tonight.

The Government want to encourage the private entrepreneur, and not because they want to reward the Government's political friends, as was suggested by the hon. Member for South Shields (Dr. Clark). The only friends whom the regulations will reward are the ratepayers, and the Conservative party is the only party that is a friend to them. The hon. Member for Manchester, Central (Mr. Litherland) spoke of Manchester, and said that it is competitive and fair. I agree that some local authority DLOs are fair, and they do not have anything to fear from competition. But in 1982, £2,000 million of public work was undertaken by local government. Surely it is right that it should be covered by regulation. Public accountability must be introduced for that amount of public money. I welcome the regulations and the new limits proposed.

Direct labour departments have nothing to fear from the regulations if they are efficient; it is the inefficient that have something to fear. The ratepayer has so much to gain. My hon. Friend the Member for Mid-Staffordshire (Mr. Heddle), in an intervention, rightly said that many DLOs are not playing by the rules. Some Opposition Members asked for evidence. That has been supplied by the National Federation of Building Trades Employers, and has no doubt been supplied to disbelieving Opposition Members. There are abuses. It is surely unfair to count in the cost of work the cost of having to lay off those in the direct labour department if it does not win the tender. It should not be possible to split up the tender into such small pieces that they are not within the limits. It should not be possible to make smaller contracts into one enormous contract, which is so large that few private entrepreneurs can tender for it. That is the abuse indulged in by direct labour departments. That is why I welcomed the 1980 legislation and the further tightening of that with the present regulations.

We believe that sometimes, although not necessarily always, direct labour departments are inefficient and give less value for money than would be gained from private tender. The Labour party does not agree with that, which is why it opposes the regulations. It cares little for private enterprise and private business freedom. That is its affair, but we should not allow the Labour party, with its dogma, to permit Socialist authorities to make loopholes in the law in the manner that has been mentioned.

Rates are already high enough in Labour-controlled authorities, and it is the job of this House to make sure that they are curbed. Where we have the opportunity—as we have under the 1980 legislation—to curb those abuses we should be taking it. In the interests of the law and of the ratepayers, I hope that the Minister will, in the course of his tenure of office, clamp down on those authorities that are responsible for abuses.

Photo of Simon Hughes Simon Hughes Shadow Spokesperson (Environment, Food and Rural Affairs) 11:15 pm, 18th July 1983

Three hours ago I was discussing with some tenants in my constituency the order that we are now debating. I put to them the issues that would come before the House. I asked them whether they were in favour of the retention of the direct labour organisation or whether they were in favour of building— whether major repairs or renovation on their estate or work on the roads outside it—being done by private contractors. Their answer was simple. They said, "We want the job done by the best people available."

In the debate it seems to have been almost forgotten that the reason and justification for the existence of direct labour organisations or local authorities is to serve the ratepayer and the tenant. There is no other justification. The debate has shown that direct labour has become a political football to be kicked around between the two traditional sparring parties as a proof of their masculinity in defending or attacking the principle of direct labour. That is wrong. The protagonists are either workers employed by the local authority or workers employed by small or big businesses. They are people who want a job and an income, and people who would hope to do a good job for the money that they are paid.

The direct labour organisation exists, as some hon. Members have said, to give service all the year round in ways that other competing organisations would not do, and to be available in times of bad weather, at weekends and in antisocial hours, to deal with the problems that arise, as well as taking on major jobs that it can do best in the local authority in question.

We have no dogmatic belief on the Liberal Benches that direct labour organisations have a justification for existence of themselves, just as we have no belief that a small business will necessarily do a better job. I have seen small and big businesses do bad jobs on the estates in my constituency, just as I have seen my local authority direct labour organisation do good and bad jobs in my constituency. That is the honest experience of all those who have looked at the issue.

We have to examine the evidence and decide what is in the best interests of the recipients of the services. It is possible that, with bad administration, we shall have an increase in white collar jobs and an increase in bureaucracy. With increased technology, that need not be the case. With increased technology it is possible to weed out the competing tenders efficiently and quickly, and for the matter to be dealt with properly by the local authority without any undue delay or any additional employment. The tragedy is that the Government, in a period of cuts, can now tell the House that, having cut away the majority of local authorities' income, they can justify further interference in those ways.

We should like the Government to change their policy of interference in local government because their policy of interfering with and cutting to the bone many of the funds that local government needs is not in the interests of the people who depend on those local authorities. But knowing that there is very little money around and that the Government will be mean to local authorities, particularly to those local authorities which have most council tenants and therefore, in most cases, have the most need of direct labour organisations, it is important that the tenant and the ratepayer are served best.

So on the limited evidence available, and by no means saying that next year we will be doing the same thing if the evidence is pointing in a different direction, we will tonight support the Government in the interests of the ratepayer and of the tenant in the hope that they will get a better service. If, after two years experience, the evidence does not show a better service, we will make that clear. It is the ratepayers and the tenants and not the vested interests whom this House should be primarily concerned to serve.

Photo of Mr Michael Morris Mr Michael Morris , Northampton South 11:22 pm, 18th July 1983

I welcome with particular interest the amended regulations before the House. I do so against the background that in 1977 and 1978 I looked in great depth at the direct labour organisations. I listened with some astonishment to the speech from the Opposition Front Bench, which suggested that all was wonderful in the direct labour departments. Indeed, in an intervention by the hon. Member for Manchester, Central (Mr. Litherland), we heard about the wonders of Manchester's direct labour organisation, as if it were a shining light for everyone else to follow. I remind the hon. Gentleman that the first re port of the district auditor in 1976 drew attention to certain irregularities in the Manchester direct labour organisation concerning the control of repairs and maintenance work. It instanced bonus payments for work not done, overstatements of amounts of stores and little control over maintenance budgets. As if that were not enough, what happened in this wonderful city of Manchester in 1978? In 1978, the organisation was so bad on housing repair and renovation —

Photo of Mr Michael Morris Mr Michael Morris , Northampton South

I shall not give way. We have heard about Manchester. What did Manchester do in 1978? It pulled in the private sector to get it out of the hole—

Photo of Mr Robert Litherland Mr Robert Litherland , Manchester Central

It was completely vindicated.

Photo of Mr Michael Morris Mr Michael Morris , Northampton South

Manchester is up to its old tricks. In the National Builder of February, there is a comment about the major airport contract at Manchester. It says: A large slice of a £160,000 refurbishment scheme for Manchester Airport is to go to Manchester City Council Direct Works Department without first going out to tender. The article explains that Manchester city council has cobbled things together to ensure that every contract was just under that £50,000 limit although they were all part of the same contract. That is the wonderful Manchester direct labour department—this guiding light for all to follow.

Conservative Back Benchers have warned the Minister about the number of loopholes in the 1980 Act. I am pleased to say that my hon. Friend has responded on some of them, but some still exist. I should like to know that there will be vetting in the months ahead to ensure that some of these obvious loopholes are closed.

I shall mention five of the loopholes that I have found — there are probably a good many more. First, authorities fail to accept the lowest tender from private contractors, often citing mitigating circumstances, such as the cost of redundancies. That is wholly unacceptable to the ratepayer. If a contract goes out to tender on a fair basis, the lowest tender should be accepted. There should not be jiggery-pokery, a suspension of standing orders or some other bogus reason for allowing the direct labour organisation, if it is not the lowest tenderer, to get the work.

As my hon. Friend the Member for Newark (Mr. Alexander) mentioned, there are authorities which, presumably in party groups, chop big contracts into small amounts so that they come just below the statutory level. Or there is the situation, also spoken of by my hon. Friend the Member for Newark, where an authority lumps together a series of contracts into about the most complicated contract one could find, so producing a situation in which the only body able, ostensibly, to compete for the work is the DLO.

These things are happening in the world in which we live and the Minister must be aware of them because they are unfair and are working against the interests of the ratepayer. Then there are authorities that lay down unjustifiable conditions, such as union-only contracts, or political conditions. Reference was made to a certain DLO the shop steward of which was allowed to see the tenders before the tender award was announced. The result, of course, was that the DLO tender was the lowest.

Then there is the political dimension, for example warnings which go out to union members. One is reminded of the quotations cited by the Minister for Housing and Construction in a debate on DLOs last March. He quoted from an article in NUPE News which said: Members of NUPE working for local authorities need to be vigilant. When they hear of any moves — Me merest suggestion — that private contractors are contemplated they should raise the matter with their Branch and full-time officer … Above all, NUPE members must be ready to challenge each and every attempt by private contractors to burrow into local authority services".—[Official Report, 30 March 1983, Vol. 21, c. 232.] Such political action cannot be in the interests of the ratepayers. The hon. Member for Vauxhall (Mr. Holland) suggested the Keynesian economics would have supported direct labour organisations. Does he or any Labour Member really support the sort of political action have described? I cannot believe so—

Photo of Mr Michael Morris Mr Michael Morris , Northampton South

—but if the hon. Member for Vauxhall does, I willingly give way to him.

Photo of Mr Stuart Holland Mr Stuart Holland , Vauxhall

I did not say the Keynesian economics would support DLOs; I said that they could support the construction industry as a whole. Many private contractors do not know how to evaluate overheads, or conveniently do not include them. That is clear from the figures, which show the consistent over-run of estimates by private contractors. It is only right, if Conservative Members believe in the "invisible hand", that they should want to open the books. Or do they have something to hide? Let us have the books open for both DLOs and private contractors.

Photo of Mr Michael Morris Mr Michael Morris , Northampton South

I regret giving way to the hon. Gentleman; he was not even prepared to support NUPE tonight, but instead went off at a tangent on to another subject.

The Minister must also take careful note of the nature of the reports we are receiving on DLOs. My hon. Friend's Department has outlined what the reports should include but I have not found one authority that has met the model requirements. My hon. Friend must act urgently when authorities fail to produce the right sort of reports. Local authorities can pretend to follow the requirements of the Act and the statutory instruments but when they submit their annual reports—

It being half-past Eleven o'clock, MR. DEPUTY SPEAKER put the Question, pursuant to Standing Order No. 4 (Statutory Instruments, &c. (Procedure)).

The House divided: Ayes 124, Noes 231.

Division No. 26][11.30 pm
AYES
Adams, Allen (Paisley N)Home Robertson, John
Ashley, Rt Hon JackHoyle, Douglas
Atkinson, N. (Tottenham)Hughes, Mark (Durham)
Banks, Tony (Newham NW)Hughes, Sean (Knowsley S)
Barron, KevinHume, John
Beckett, Mrs MargaretJones, Barry (Alyn & Deeside)
Bell, StuartKaufman, Rt Hon Gerald
Bennett, A. (Dent'n & Red'sh)Lewis, Terence (Worsley)
Bermingham, GeraldLitherland, Robert
Boyes, RolandLloyd, Tony (Stretford)
Brown, Gordon (D'f'mline E)Lofthouse, Geoffrey
Brown, Hugh D. (Provan)Loyden, Edward
Brown, N. (N'c'tle-u-Tyne E)McDonald, Dr Oonagh
Brown, R. (N'c'tle-u-Tyne N)McKelvey, William
Brown, Ron (E'burgh, Leith)McNamara, Kevin
Buchan, NormanMcTaggart, Robert
Callaghan, Jim (Heyw'd & M)McWilliam, John
Campbell-Savours, DaleMadden, Max
Canavan, DennisMarek, Dr John
Clark, Dr David (S Shields)Martin, Michael
Clay, RobertMichie, William
Cocks, Rt Hon M. (Bristol S.)Millan, Rt Hon Bruce
Cohen, HarryMiller, Dr M. S. (E Kilbride)
Conlan, BernardMorris, Rt Hon A. (W'shawe)
Cook, Frank (Stockton North)Nellist, David
Cook, Robin F. (Livingston)Oakes, Rt Hon Gordon
Corbett, RobinO'Neill, Martin
Corbyn, JeremyOrme, Rt Hon Stanley
Cowans, HarryParry Robert
Craigen, J. M.Pavitt, Laurie
Crowther, StanPendry, Tom
Cunningham, Dr JohnPike, Peter
Dalyell, TamPowell, Raymond (Ogmore)
Davies, Ronald (Caerphilly)Prescott, John
Davis, Terry (B'ham, H'ge H'l)Randall, Stuart
Deakins, EricRedmond, M.
Dewar, DonaldRees, Rt Hon M. (Leeds S)
Dixon, DonaldRichardson, Ms Jo
Dormand, JackRobertson, George
Dubs, AlfredRogers, Allan
Duffy, A. E. P.Rooker, J. W.
Eadie, AlexRoss, Ernest (Dundee W)
Eastham, KenRowlands, Ted
Evans, John (St. Helens N)Sedgemore, Brian
Ewing, HarrySheerman, Barry
Fatchett, DerekSkinner, Dennis
Field, Frank (Birkenhead)Smith, C.(Isl'ton S & F'bury)
Fisher, MarkSmith, Rt Hon J. (M'kl'ds E)
Flannery, MartinSnape, Peter
Forrester, JohnSoley, Clive
Foster, DerekSpearing, Nigel
Foulkes, GeorgeStott, Roger
Freeson, Rt Hon ReginaldStrang, Gavin
George, BruceThompson, J. (Wansbeck)
Godman, Dr NormanTinn, James
Gould, BryanWardell, Gareth (Gower)
Hamilton, James (M'well N)Wareing, Robert
Hamilton, W. W. (Central Fife)Welsh, Michael
Harman, Ms HarrietWinnick, David
Harrison, Rt Hon WalterWoodall, Alec
Haynes, Frank
Heffer, Eric S.Tellers for the Ayes:
Hogg, N. (C'nauld & Kilsyth)Mr. Lawrence Cunliffe and
Holland, Stuart (Vauxhall)Mr. Hugh McCartney.
NOES
Alexander, RichardGalley, Roy
Ancram, MichaelGardiner, George (Reigate)
Arnold, TomGarel-Jones, Tristan
Ashby, DavidGoodlad, Alastair
Ashdown, PaddyGorst, John
Aspinwall, JackGow, Ian
Atkins, Rt Hon H. (S'thorne)Gregory, Conal
Atkins Robert (South Ribble)Griffiths, Peter (Portsm'th N)
Atkinson, David (B'm'th E)Ground, Patrick
Baker, Nicholas (N Dorset)Gummer, John Selwyn
Baldry, AnthonyHamilton, Hon A. (Epsom)
Batiste, SpencerHamilton, Neil (Tatton)
Beaumont-Dark, AnthonyHampson, Dr Keith
Beith, A. J.Hanley, Jeremy
Bellingham, HenryHargreaves, Kenneth
Berry, Hon AnthonyHarris, David
Biggs-Davison, Sir JohnHarvey, Robert
Blackburn, JohnHawkins, Sir Paul (SW N'folk)
Blaker, Rt Hon PeterHawksley, Warren
Body, RichardHayes, J.
Boscawen, Hon RobertHayward, Robert
Bottomley, PeterHeath, Rt Hon Edward
Bowden, Gerald (Dulwich)Heathcoat-Amory, David
Boyson, Dr RhodesHeddle, John
Brandon-Bravo, MartinHenderson, Barry
Bright, GrahamHickmet, Richard
Brinton, TimHirst, Michael
Brooke, Hon PeterHolland, Sir Philip (Gedling)
Brown, M. (Brigg & Cl'thpes)Howarth, Gerald (Cannock)
Bryan, Sir PaulHowell, Ralph (N Norfolk)
Buck, Sir AntonyHughes, Simon (Southwark)
Budgen, NickHunt, David (Wirral)
Bulmer, EsmondHunter, Andrew
Burt, AlistairJackson, Robert
Butcher, JohnJohnston, Russell
Butterfill, JohnJones, Robert (W Herts)
Carlile, Alexander (Montg'y)Kennedy, Charles
Carlisle, John (N Luton)Knight, Gregory (Derby N)
Carlisle, Kenneth (Lincoln)Lang, Ian
Carttiss, MichaelLeigh, Edward (Gainsbor'gh)
Chalker, Mrs LyndaLilley, Peter
Chapman, SydneyLloyd, Peter, (Fareham)
Chope, ChristopherMcCurley, Mrs Anna
Clark, Dr Michael (Rochford)Malone, Gerald
Clarke Kenneth (Rushcliffe)Mates, Michael
Cockeram, EricMayhew, Sir Patrick
Colvin, MichaelMeadowcroft, Michael
Conway, DerekMellor, David
Coombs, SimonMerchant, Piers
Cope, JohnMeyer, Sir Anthony
Couchman, JamesMiller, Hal (B'grove)
Cranborne, ViscountMills, Iain (Meriden)
Crouch, DavidMiscampbell, Norman
Currie, Mrs EdwinaMoate, Roger
Dickens, GeoffreyMontgomery, Fergus
Dicks, T.Moore, John
Dorrell, StephenMorris, M. (N'hampton, S)
Douglas-Hamilton, Lord J.Morrison, Hon P. (Chester)
Dover, DenshoreMoynihan, Hon C.
Dunn, RobertMurphy, Christopher
Dykes, HughNeale, Gerrard
Edwards, Rt Hon N. (P'broke)Needham, Richard
Eggar, TimNelson, Anthony
Evennett, DavidNeubert, Michael
Eyre, ReginaldNicholls, Patrick
Fairbairn, NicholasNorris, Steven
Farr, JohnOnslow, Cranley
Favell, AnthonyOsborn, Sir John
Fenner, Mrs PeggyOttaway, Richard
Finsberg, GeoffreyPage, Richard (Herts SW)
Fletcher, AlexanderParkinson, Rt Hon Cecil
Forman, NigelParris, Matthew
Forsyth, Michael (Stirling)Peacock, Mrs Elizabeth
Forth, EricPenhaligon, David
Fowler, Rt Hon NormanPink, R. Bonner
Fox, MarcusPollock, Alexander
Franks, CecilPorter, Barry
Freeman, RogerPowell, William (Corby)
Gale, RogerPowley, John
Prentice, Rt Hon RegTemple-Morris, Peter
Proctor, K. HarveyThomas, Rt Hon Peter
Raffan, KeithThompson, Donald (Calder V)
Renton, TimThompson, Patrick (N'ich N)
Rhys Williams, Sir BrandonThorne, Neil (llford S)
Ridsdale, Sir JulianThornton, Malcolm
Roberts, Wyn (Conwy)Thurnham, Peter
Robinson, Mark (N'port W)Townend, John (Bridlington)
Roe, Mrs MarionTracey, Richard
Rowe, AndrewTrippier, David
Rumbold, Mrs AngelaTrotter, Neville
Ryder, RichardTwinn, Dr Ian
Sackville, Hon Thomasvan Straubenzee, Sir W.
Sainsbury, Hon TimothyViggers, Peter
Sayeed, JonathanWaddington, David
Shaw, Sir Michael (Scarb')Wakeham, Rt Hon John
Shelton, William (Streatham)Waldegrave, Hon William
Shepherd, Colin (Hereford)Walden, George
Shepherd, Richard (Aldridge)Walker, Bill (T'side N)
Shersby, MichaelWall, Sir Patrick
Sims, RogerWaller, Gary
Skeet, T. H. H.Wardle, C (Bexhill)
Smith, Tim (Beaconsfield)Warren, Kenneth
Soames, Hon NicholasWatts, John
Speed, KeithWheeler, John
Speller, TonyWhitfield, John
Spencer, D.Wiggin, Jerry
Spicer, Jim (W Dorset)Winterton, Mrs Ann
Spicer, Michael (S Worcs)Winterton, Nicholas
Stanbrook, IvorWolfson, Mark
Stanley, JohnWood, Timothy
Steen, AnthonyWoodcock, Michael
Stern, MichaelYeo, Tim
Stevens, Lewis (Nuneaton)Young, Sir George (Acton)
Stevens, Martin (Fulham)
Stewart, Allan (Eastwood)Tellers for the Noes:
Sumberg, DavidMr. Douglas Hogg and
Taylor, John (Solihull)Mr. John Major.
Taylor, Teddy (S'end E)

Question accordingly negatived.