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bc2a5030dc8e0862b8e1d5f913ff0c4446b8f2c0 | School Placement Planning City of York Council Internal Audit Report 2016/17
Business Unit: Children, Education and Communities Responsible Officer: Assistant Director, Education and Skills Service Manager: Head of School Services Date Issued: 31 May 2017 Status: Final Reference: 11330/001
| Actions | P1 | P2 | P3 | |---------|----|----|----| | Overall Audit Opinion | High Assurance | Summary and Overall Conclusions
Introduction Each address in the City of York is located in the catchment area of one York primary school and at least one secondary school. The local authority has a duty to arrange school places for each school age child within its area, and serves as admissions authority for many schools, not including academies and some faith schools. Parents are required to submit an application for a school place, and can submit up to 5 preferences for schools. For September 2016 entry, 91% of applications of secondary pupils were allocated to their first preference and 94.4% of primary pupils were allocated their first preference.
Objectives and Scope of the Audit The purpose of this audit was to provide assurance to management that procedures and controls within the system will ensure that:
- There is a robust process in place to monitor the requirements for school placements and identify potential issues
- There is a robust process in place to allocate school places in accordance with admissions policies
- Where action is required suitable action is taken to ensure each school age child in York is offered a school place
Key Findings The council produces detailed forecasting information for each Primary and Secondary planning area which allows for future planning in relation to the provision of school places. In the future these will be published on the council’s website.
Admissions are managed electronically and the admissions system has a full audit trail of every step of the process, from individual applications, admissions criteria to allocations, rejections and waiting lists.
The council, in conjunction with the schools in York, takes action to ensure that there are places for all pupils. As several York schools have converted to academies and more conversions are planned, as well as a new free schools being approved, the negotiations regarding how to address changing demand for school places may become more challenging, however the council is well placed to understand the requirements for school places across the city as much as is possible.
The council publish several different data sets regarding school places and allocations. It is suggested that the assessment of how accurate the predictions were for demand for school places also be published to complete the picture. Overall Conclusions
It was found that the arrangements for managing risk were very good. An effective control environment appears to be in operation. Our overall opinion of the controls within the system at the time of the audit was that they provided High Assurance. Audit Opinions and Priorities for Actions
Audit Opinions
Audit work is based on sampling transactions to test the operation of systems. It cannot guarantee the elimination of fraud or error. Our opinion is based on the risks we identify at the time of the audit.
Our overall audit opinion is based on 5 grades of opinion, as set out below.
| Opinion | Assessment of internal control | |--------------------|------------------------------------------------------------------------------------------------| | High Assurance | Overall, very good management of risk. An effective control environment appears to be in operation. | | Substantial Assurance | Overall, good management of risk with few weaknesses identified. An effective control environment is in operation but there is scope for further improvement in the areas identified. | | Reasonable Assurance | Overall, satisfactory management of risk with a number of weaknesses identified. An acceptable control environment is in operation but there are a number of improvements that could be made. | | Limited Assurance | Overall, poor management of risk with significant control weaknesses in key areas and major improvements required before an effective control environment will be in operation. | | No Assurance | Overall, there is a fundamental failure in control and risks are not being effectively managed. A number of key areas require substantial improvement to protect the system from error and abuse. |
Priorities for Actions
| Priority | Description | |----------|-----------------------------------------------------------------------------| | Priority 1 | A fundamental system weakness, which presents unacceptable risk to the system objectives and requires urgent attention by management. | | Priority 2 | A significant system weakness, whose impact or frequency presents risks to the system objectives, which needs to be addressed by management. | | Priority 3 | The system objectives are not exposed to significant risk, but the issue merits attention by management. | Where information resulting from audit work is made public or is provided to a third party by the client or by Veritau then this must be done on the understanding that any third party will rely on the information at its own risk. Veritau will not owe a duty of care or assume any responsibility towards anyone other than the client in relation to the information supplied. Equally, no third party may assert any rights or bring any claims against Veritau in connection with the information. Where information is provided to a named third party, the third party will keep the information confidential.
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ed3ed770a9a68abf764253238ca871f55637a479 | Application for Planning Permission Town and Country Planning Act 1990
You can complete and submit this form electronically via the Planning Portal website by visiting www.planningportal.gov.uk/apply
Publication of applications on planning authority websites Please note that the information provided on this application form and in supporting documents may be published on the Authority's website. If you require any further clarification, please contact the Authority's planning department.
Please complete using block capitals and black ink. It is important that you read the accompanying guidance notes as incorrect completion will delay the processing of your application.
| 1. Applicant Name and Address | 2. Agent Name and Address | |-------------------------------|---------------------------| | **Title:** | **Title:** | | **First name:** | **First name:** | | **Last name:** | **Last name:** | | **Company (optional):** | **Company (optional):** | | **Unit:** | **Unit:** | | **House number:** | **House number:** | | **House suffix:** | **House suffix:** | | **House name:** | **House name:** | | **Address 1:** | **Address 1:** | | **Address 2:** | **Address 2:** | | **Address 3:** | **Address 3:** | | **Town:** | **Town:** | | **County:** | **County:** | | **Country:** | **Country:** | | **Postcode:** | **Postcode:** |
| 3. Description of the Proposal | |-------------------------------| | **SEE REF. 1A** | | **LOFT CONVERSION INCLUDING ALTERATION TO ROOF AND INSTALLATION OF ROOF LIGHTS.** | | **PREVIOUS APPLICATION FOR CHANGE OF USE OF PROPERTY FROM A (C3) DWELLING HOUSE TO A BED AND BREAKFAST (C1) PASSED 11.3.14 NP NO. NP/DDD/0112/005** | | **NO CHANGES TO GUEST ACCOMMODATION INCLUDED IN THIS PROPOSAL. RELEVANT TO OWNERS ACCOMMODATION ONLY** |
Has the building, work or change of use already started?\
☐ Yes ☒ No If Yes, please state the date when building, work or use were started (DD/MM/YYYY):
Has the building, work or change of use been completed?\
☐ Yes ☐ No If Yes, please state the date when the building, work or change of use was completed (DD/MM/YYYY):
Date: 2015-04-02 00:00:00 4. Site Address Details Please provide the full postal address of the application site.
Unit: [ ] House number: [ ] House suffix: [ ]
House name: [ ] Address 1: [ ] Address 2: [ ] Address 3: [ ]
Town: [ ] County: [ ] Postcode (optional): [ ]
Description of location or a grid reference: (must be completed if postcode is not known): Easting: [ ] Northing: [ ]
Description:
5. Pre-application Advice Has assistance or prior advice been sought from the local authority about this application? [ ] Yes [ ] No
If Yes, please complete the following information about the advice you were given. (This will help the authority to deal with this application more efficiently). Please tick if the full contact details are not known, and then complete as much as possible:
Officer name: [ ] Reference: [ ] Date (DD/MM/YYYY): [ ]
Details of pre-application advice received:
6. Pedestrian and Vehicle Access, Roads and Rights of Way Is a new or altered vehicle access proposed to or from the public highway? [ ] Yes [ ] No
Is a new or altered pedestrian access proposed to or from the public highway? [ ] Yes [ ] No
Are there any new public roads to be provided within the site? [ ] Yes [ ] No
Are there any new public rights of way to be provided within or adjacent to the site? [ ] Yes [ ] No
Do the proposals require any diversions/extinguishments and/or creation of rights of way? [ ] Yes [ ] No
If you answered Yes to any of the above questions, please show details on your plans/drawings and state the reference of the plan(s)/drawing(s):
7. Waste Storage and Collection Do the plans incorporate areas to store and aid the collection of waste? [ ] Yes [ ] No
If Yes, please provide details:
Have arrangements been made for the separate storage and collection of recyclable waste? [ ] Yes [ ] No
If Yes, please provide details:
8. Authority Employee / Member With respect to the Authority, I am: (a) a member of staff (b) an elected member (c) related to a member of staff (d) related to an elected member
Do any of these statements apply to you? [ ] Yes [ ] No
If Yes, please provide details of the name, relationship and role:
Date: 2015-04-02 08:54:48 9. Materials If applicable, please state what materials are to be used externally. Include type, colour and name for each material:
| Material Type | Existing (where applicable) | Proposed | Not applicable | Don't Know | |-------------------------------|-----------------------------|----------|----------------|------------| | Walls | SEE REFERENCE 1B | | | | | Roof | SEE REFERENCE 1B | | | | | Windows | SEE REFERENCE 1B | | | | | Doors | | | | | | Boundary treatments | | | | | | Vehicle access and hard-standing | | | | | | Lighting | | | | | | Others (please specify) | | | | |
Are you supplying additional information on submitted plan(s)/drawing(s)/design and access statement? [ ] Yes [ ] No
If Yes, please state references for the plan(s)/drawing(s)/design and access statement:
DESIGN AND ACCESS STATEMENT REF. 1C BLOCK PLAN REF. 1D EXISTING ELEVATIONS REF. 1G CURRENT FLOOR PLAN REF. 1E PROPOSED FLOOR PLAN REF. 1F PROPOSED ALTERATIONS REF. 1H PHOTOS - REF. 1J
10. Vehicle Parking Please provide information on the existing and proposed number of on-site parking spaces:
| Type of Vehicle | Total Existing | Total proposed (including spaces retained) | Difference in spaces | |------------------------------------------|----------------|--------------------------------------------|----------------------| | Cars | 5 owners | 5 owners | NONE | | Light goods vehicles/public carrier vehicles | | | | | Motorcycles | | | | | Disability spaces | | | | | Cycle spaces | | | | | Other (e.g. Bus) | | | | | Other (e.g. Bus) | | | | 11. Foul Sewage Please state how foul sewage is to be disposed of:
- [ ] Mains sewer
- [ ] Cess pit
- [ ] Septic tank
- [ ] Other
- [ ] Package treatment plant
Are you proposing to connect to the existing drainage system?
- [ ] Yes
- [ ] No
If Yes, please include the details of the existing system on the application drawings and state references for the plan(s)/drawing(s):
NO CHANGES TO EXISTING SEWAGE DISPOSAL
12. Assessment of Flood Risk Is the site within an area at risk of flooding? (Refer to the Environment Agency's Flood Map showing flood zones 2 and 3 and consult Environment Agency standing advice and your local planning authority requirements for information as necessary.)
- [ ] Yes
- [ ] No
If Yes, you will need to submit a Flood Risk Assessment to consider the risk to the proposed site.
Is your proposal within 20 metres of a watercourse (e.g. river, stream or beck)?
- [ ] Yes
- [ ] No
Will the proposal increase the flood risk elsewhere?
- [ ] Yes
- [ ] No
How will surface water be disposed of?
- [ ] Sustainable drainage system
- [ ] Existing watercourse
- [ ] Soakaway
- [ ] Pond/lake
- [ ] Main sewer
13. Biodiversity and Geological Conservation To assist in answering the following questions refer to the guidance notes for further information on when there is a reasonable likelihood that any important biodiversity or geological conservation features may be present or nearby and whether they are likely to be affected by your proposals.
Having referred to the guidance notes, is there a reasonable likelihood of the following being affected adversely or conserved and enhanced within the application site, or on land adjacent to or near the application site?
a) Protected and priority species:
- [ ] Yes, on the development site
- [ ] Yes, on land adjacent to or near the proposed development
- [ ] No
b) Designated sites, important habitats or other biodiversity features:
- [ ] Yes, on the development site
- [ ] Yes, on land adjacent to or near the proposed development
- [ ] No
c) Features of geological conservation importance:
- [ ] Yes, on the development site
- [ ] Yes, on land adjacent to or near the proposed development
- [ ] No
14. Existing Use Please describe the current use of the site:
DWELLING HOUSE WITH 3 BEDROOM ACCOMMODATION FOR BED AND BREAKFAST USE
Is the site currently vacant?
- [ ] Yes
- [ ] No
If Yes, please describe the last use of the site:
When did this use end (if known)?
DD/MM/YYYY
(date where known may be approximate)
Does the proposal involve any of the following?
- [ ] Yes
- [ ] No
If yes, you will need to submit an appropriate contamination assessment with your application.
Land which is known to be contaminated?
- [ ] Yes
- [ ] No
Land where contamination is suspected for all or part of the site?
- [ ] Yes
- [ ] No
A proposed use that would be particularly vulnerable to the presence of contamination?
- [ ] Yes
- [ ] No
15. Trees and Hedges Are there trees or hedges on the proposed development site?
- [ ] Yes
- [ ] No
And/or: Are there trees or hedges on land adjacent to the proposed development site that could influence the development or might be important as part of the local landscape character?
- [ ] Yes
- [ ] No
If Yes to either or both of the above, you may need to provide a full Tree Survey, at the discretion of your local planning authority. If a Tree Survey is required, this and the accompanying plan should be submitted alongside your application. Your local planning authority should make clear on its website what the survey should contain, in accordance with the current 'BS5837: Trees in relation to design, demolition and construction - Recommendations'.
16. Trade Effluent Does the proposal involve the need to dispose of trade effluents or waste?
- [ ] Yes
- [ ] No
If Yes, please describe the nature, volume and means of disposal of trade effluents or waste. 17. Residential Units (Including Conversion)
Does your proposal include the gain, loss or change of use of residential units? □ Yes □ No
If Yes, please complete details of the changes in the tables below:
| Proposed Housing | Existing Housing | |------------------|------------------| | **Market Housing** | **Not known** | **Number of Bedrooms** | **Total** | **Market Housing** | **Not known** | **Number of Bedrooms** | **Total** | | Houses | □ | 1 | 2 | 3 | 4+ | Unknown | Houses | □ | 1 | 2 | 3 | 4+ | Unknown | | Flats and maisonettes | □ | 1 | 2 | 3 | 4+ | Unknown | Flats and maisonettes | □ | 1 | 2 | 3 | 4+ | Unknown | | Live-work units | □ | 1 | 2 | 3 | 4+ | Unknown | Live-work units | □ | 1 | 2 | 3 | 4+ | Unknown | | Cluster flats | □ | 1 | 2 | 3 | 4+ | Unknown | Cluster flats | □ | 1 | 2 | 3 | 4+ | Unknown | | Sheltered housing | □ | 1 | 2 | 3 | 4+ | Unknown | Sheltered housing | □ | 1 | 2 | 3 | 4+ | Unknown | | Bedsit/studios | □ | 1 | 2 | 3 | 4+ | Unknown | Bedsit/studios | □ | 1 | 2 | 3 | 4+ | Unknown | | Unknown type | □ | 1 | 2 | 3 | 4+ | Unknown | Unknown type | □ | 1 | 2 | 3 | 4+ | Unknown |
**Totals (a+b+c+d+e+f+g) =**
| Social Rented | **Not known** | **Number of Bedrooms** | **Total** | **Social Rented** | **Not known** | **Number of Bedrooms** | **Total** | |----------------|----------------|------------------------|----------|------------------|----------------|------------------------|----------| | Houses | □ | 1 | 2 | 3 | 4+ | Unknown | Houses | □ | 1 | 2 | 3 | 4+ | Unknown | | Flats and maisonettes | □ | 1 | 2 | 3 | 4+ | Unknown | Flats and maisonettes | □ | 1 | 2 | 3 | 4+ | Unknown | | Live-work units | □ | 1 | 2 | 3 | 4+ | Unknown | Live-work units | □ | 1 | 2 | 3 | 4+ | Unknown | | Cluster flats | □ | 1 | 2 | 3 | 4+ | Unknown | Cluster flats | □ | 1 | 2 | 3 | 4+ | Unknown | | Sheltered housing | □ | 1 | 2 | 3 | 4+ | Unknown | Sheltered housing | □ | 1 | 2 | 3 | 4+ | Unknown | | Bedsit/studios | □ | 1 | 2 | 3 | 4+ | Unknown | Bedsit/studios | □ | 1 | 2 | 3 | 4+ | Unknown | | Unknown type | □ | 1 | 2 | 3 | 4+ | Unknown | Unknown type | □ | 1 | 2 | 3 | 4+ | Unknown |
**Totals (a+b+c+d+e+f+g) =**
| Intermediate | **Not known** | **Number of Bedrooms** | **Total** | **Intermediate** | **Not known** | **Number of Bedrooms** | **Total** | |---------------|----------------|------------------------|----------|------------------|----------------|------------------------|----------| | Houses | □ | 1 | 2 | 3 | 4+ | Unknown | Houses | □ | 1 | 2 | 3 | 4+ | Unknown | | Flats and maisonettes | □ | 1 | 2 | 3 | 4+ | Unknown | Flats and maisonettes | □ | 1 | 2 | 3 | 4+ | Unknown | | Live-work units | □ | 1 | 2 | 3 | 4+ | Unknown | Live-work units | □ | 1 | 2 | 3 | 4+ | Unknown | | Cluster flats | □ | 1 | 2 | 3 | 4+ | Unknown | Cluster flats | □ | 1 | 2 | 3 | 4+ | Unknown | | Sheltered housing | □ | 1 | 2 | 3 | 4+ | Unknown | Sheltered housing | □ | 1 | 2 | 3 | 4+ | Unknown | | Bedsit/studios | □ | 1 | 2 | 3 | 4+ | Unknown | Bedsit/studios | □ | 1 | 2 | 3 | 4+ | Unknown | | Unknown type | □ | 1 | 2 | 3 | 4+ | Unknown | Unknown type | □ | 1 | 2 | 3 | 4+ | Unknown |
**Totals (a+b+c+d+e+f+g) =**
| Key worker | **Not known** | **Number of Bedrooms** | **Total** | **Key worker** | **Not known** | **Number of Bedrooms** | **Total** | |------------|----------------|------------------------|----------|----------------|----------------|------------------------|----------| | Houses | □ | 1 | 2 | 3 | 4+ | Unknown | Houses | □ | 1 | 2 | 3 | 4+ | Unknown | | Flats and maisonettes | □ | 1 | 2 | 3 | 4+ | Unknown | Flats and maisonettes | □ | 1 | 2 | 3 | 4+ | Unknown | | Live-work units | □ | 1 | 2 | 3 | 4+ | Unknown | Live-work units | □ | 1 | 2 | 3 | 4+ | Unknown | | Cluster flats | □ | 1 | 2 | 3 | 4+ | Unknown | Cluster flats | □ | 1 | 2 | 3 | 4+ | Unknown | | Sheltered housing | □ | 1 | 2 | 3 | 4+ | Unknown | Sheltered housing | □ | 1 | 2 | 3 | 4+ | Unknown | | Bedsit/studios | □ | 1 | 2 | 3 | 4+ | Unknown | Bedsit/studios | □ | 1 | 2 | 3 | 4+ | Unknown | | Unknown type | □ | 1 | 2 | 3 | 4+ | Unknown | Unknown type | □ | 1 | 2 | 3 | 4+ | Unknown |
**Totals (a+b+c+d+e+f+g) =**
**Total proposed residential units (A+B+C+D) =**
**Total existing residential units (E+F+G+H) =**
**TOTAL NET GAIN or LOSS of RESIDENTIAL UNITS (Proposed Housing Grand Total - Existing Housing Grand Total):** 18. All Types of Development: Non-residential Floorspace
Does your proposal involve the loss, gain or change of use of non-residential floorspace? □ Yes □ No
If you have answered Yes to the question above please add details in the following table:
| Use class/type of use | Not applicable | Existing gross internal floorspace (square metres) | Gross internal floorspace to be lost by change of use or demolition (square metres) | Total gross internal floorspace proposed (including change of use)(square metres) | Net additional gross internal floorspace following development (square metres) | |-----------------------|----------------|---------------------------------------------------|---------------------------------------------------------------------------------|---------------------------------------------------------------------------------|--------------------------------------------------------------------------------| | A1 Shops | | | | | | | A2 Financial and professional services | | | | | | | A3 Restaurants and cafes | | | | | | | A4 Drinking establishments | | | | | | | A5 Hot food takeaways | | | | | | | B1 (a) Office (other than A2) | | | | | | | B1 (b) Research and development | | | | | | | B1 (c) Light industrial | | | | | | | B2 General industrial | | | | | | | B8 Storage or distribution | | | | | | | C1 Hotels and halls of residence | | | | | | | C2 Residential institutions | | | | | | | D1 Non-residential institutions | | | | | | | D2 Assembly and leisure | | | | | | | OTHER | | | | | | | Please Specify | | | | | | | Total | | | | | |
In addition, for hotels, residential institutions and hostels, please additionally indicate the loss or gain of rooms
| Use class | Type of use | Not applicable | Existing rooms to be lost by change of use or demolition | Total rooms proposed (including changes of use) | Net additional rooms | |-----------|-------------|----------------|----------------------------------------------------------|-------------------------------------------------|----------------------| | C1 Hotels | | X | NONE | ONE - TO CREATE | ONE | | C2 Residential institutions | | | OFFICE SPACE / STORAGE | | | | OTHER | | | SECOND SITTING AREA | | | | Please Specify | | | FOR OWNERS ONLY | | |
19. Employment
Please complete the following information regarding employees:
| Existing employees | Full-time | Part-time | Total full-time equivalent | |---------------------|-----------|-----------|---------------------------| | Proposed employees | NONE | NONE | NONE |
20. Hours of Opening
If known, please state the hours of opening (e.g. 15:30) for each non-residential use proposed:
| Use | Monday to Friday | Saturday | Sunday and Bank Holidays | Not known | |-----|------------------|----------|--------------------------|-----------| | BEYOND BREAKFAST - OPEN FOR BUSINESS ALL YEAR | | | | | | UNLESS OWNERS ON HOLIDAY | | | | |
21. Site Area
Please state the site area in hectares (ha) 0.0013 22. Industrial or Commercial Processes and Machinery
Please describe the activities and processes which would be carried out on the site and the end products including plant, ventilation or air conditioning. Please include the type of machinery which may be installed on site:
Is the proposal a waste management development? □ Yes □ No
If the answer is Yes, please complete the following table:
| Process Type | Not applicable | The total capacity of the void in cubic metres, including engineering surcharge and making no allowance for cover or restoration material (or tonnes if solid waste or litres if liquid waste) | Maximum annual operational throughput in tonnes (or litres if liquid waste) | |--------------------------------------------------|----------------|---------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------| | Inert landfill | | | | | Non-hazardous landfill | | | | | Hazardous landfill | | | | | Energy from waste incineration | | | | | Other incineration | | | | | Landfill gas generation plant | | | | | Pyrolysis/gasification | | | | | Metal recycling site | | | | | Transfer stations | | | | | Material recovery/recycling facilities (MRFs) | | | | | Household civic amenity sites | | | | | Open windrow composting | | | | | In-vessel composting | | | | | Anaerobic digestion | | | | | Any combined mechanical, biological and/or thermal treatment (MBT) | | | | | Sewage treatment works | | | | | Other treatment | | | | | Recycling facilities construction, demolition and excavation waste | | | | | Storage of waste | | | | | Other waste management | | | | | Other developments | | | |
Please provide the maximum annual operational throughput of the following waste streams:
| Waste Stream | Municipal | Construction, demolition and excavation | Commercial and industrial | Hazardous | |-------------------------------|-----------|------------------------------------------|---------------------------|-----------|
If this is a landfill application you will need to provide further information before your application can be determined. Your waste planning authority should make clear what information it requires on its website.
23. Hazardous Substances
Does the proposal involve the use or storage of any of the following materials in the quantities stated below? □ Yes □ No □ Not applicable
If Yes, please provide the amount of each substance that is involved:
| Substance | Amount (tonnes) | |----------------------------|-----------------| | Acrylonitrile (tonnes) | | | Ethylene oxide (tonnes) | | | Phosgene (tonnes) | | | Ammonia (tonnes) | | | Hydrogen cyanide (tonnes) | | | Sulphur dioxide (tonnes) | | | Bromine (tonnes) | | | Liquid oxygen (tonnes) | | | Flour (tonnes) | | | Chlorine (tonnes) | | | Liquid petroleum gas (tonnes) | | | Refined white sugar (tonnes) | | | Other: | | | Amount (tonnes): | | | Other: | | | Amount (tonnes): | | 24. Ownership Certificates and Agricultural Land Declaration (continued)
CERTIFICATE OF OWNERSHIP - CERTIFICATE C
Town and Country Planning (Development Management Procedure) (England) Order 2015 Certificate under Article 14
certify/ The applicant certifies that:
- Neither Certificate A or B can be issued for this application
- All reasonable steps have been taken to find out the names and addresses of the other owners\* and/or agricultural tenants\*\* of the land or building, or of a part of it, but I have/ the applicant has been unable to do so.
* "owner" is a person with a freehold interest or leasehold interest with at least 7 years left to run.
\*\* "agricultural tenant" has the meaning given in section 65(8) of the Town and Country Planning Act 1990
The steps taken were:
| Name of Owner / Agricultural Tenant | Address | Date Notice Served | |-------------------------------------|---------|--------------------| | | | | | | | | | | | | | | | |
Notice of the application has been published in the following newspaper (circulating in the area where the land is situated):
On the following date (which must not be earlier than 21 days before the date of the application):
Signed - Applicant: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Or signed - Agent: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Date (DD/MM/YYYY): \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
CERTIFICATE OF OWNERSHIP - CERTIFICATE D
Town and Country Planning (Development Management Procedure) (England) Order 2015 Certificate under Article 14
certify/ The applicant certifies that:
Certificate A cannot be issued for this application
All reasonable steps have been taken to find out the names and addresses of everyone else who, on the day 21 days before the date of this application, was the owner\* and/or agricultural tenant\*\* of any part of the land to which this application relates, but I have/ the applicant has been unable to do so.
- "owner" is a person with a freehold interest or leasehold interest with at least 7 years left to run.
\*\* "agricultural tenant" has the meaning given in section 65(8) of the Town and Country Planning Act 1990
The steps taken were:
Notice of the application has been published in the following newspaper (circulating in the area where the land is situated):
On the following date (which must not be earlier than 21 days before the date of the application):
Signed - Applicant: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Or signed - Agent: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Date (DD/MM/YYYY): \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
25. Planning Application Requirements - Checklist
Please read the following checklist to make sure you have sent all the information in support of your proposal. Failure to submit all information required will result in your application being deemed invalid. It will not be considered valid until all information required by the Local Planning Authority has been submitted.
The original and 3 copies of a completed and dated application form: ☒
The original and 3 copies of the plan which identifies the land to which the application relates drawn to an identified scale and showing the direction of North: ☒
The original and 3 copies of other plans and drawings or information necessary to describe the subject of the application: ☒
The correct fee: ☒
The original and 3 copies of a design and access statement, if required (see help text and guidance notes for details): ☒
The original and 3 copies of the completed, dated Ownership Certificate (A, B, C or D – as applicable) and Article 14 Certificate (Agricultural Holdings): ☒ 24. Ownership Certificates and Agricultural Land Declaration
One Certificate A, B, C, or D, must be completed with this application form
CERTIFICATE OF OWNERSHIP - CERTIFICATE A
Town and Country Planning (Development Management Procedure) (England) Order 2015 Certificate under Article 14
I certify/The applicant certifies that on the day 21 days before the date of this application nobody except myself/ the applicant was the owner\* of any part of the land or building to which the application relates, and that none of the land to which the application relates is, or is part of, an agricultural holding\*\*
NOTE: You should sign Certificate B, C or D, as appropriate, if you are the sole owner of the land or building to which the application relates but the land is, or is part of, an agricultural holding.
- "owner" is a person with a freehold interest or leasehold interest with at least 7 years left to run. \*\* "agricultural holding" has the meaning given by reference to the definition of "agricultural tenant" in section 65(8) of the Act.
| Name of Owner / Agricultural Tenant | Address | Date Notice Served | |-------------------------------------|---------|--------------------| | | | | | | | | | | | | | | | |
Signed - Applicant: [Signature]
Or signed - Agent: [Signature]
Date (DD/MM/YYYY): 01/10/2015
CERTIFICATE OF OWNERSHIP - CERTIFICATE B
Town and Country Planning (Development Management Procedure) (England) Order 2015 Certificate under Article 14
I certify/The applicant certifies that I have/the applicant has given the requisite notice to everyone else (as listed below) who, on the day 21 days before the date of this application, was the owner\* and/or agricultural tenant\*\* of any part of the land or building to which this application relates.
- "owner" is a person with a freehold interest or leasehold interest with at least 7 years left to run. \*\* "agricultural tenant" has the meaning given in section 65(8) of the Town and Country Planning Act 1990
| Name of Owner / Agricultural Tenant | Address | Date Notice Served | |-------------------------------------|---------|--------------------| | | | | | | | | | | | | | | | |
Signed - Applicant: [Signature]
Or signed - Agent: [Signature]
Date (DD/MM/YYYY): [Blank]
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9e8df289493c5c319a8789325c46253e4d838cd2 | Hi Steve
Mr Booker rang, who lives at No 2 Eccles Close, Hope. He just wanted us to note that he has no objections to his neighbour’s application for a dormer window.
Thanks
Lisa
(copied to OST, in case you need to log it)
Lisa Walker Customer and Business Support Team Manager Peak District National Park Authority
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51c90d8cf118e554b303bdeb103efd5a6c76c0a9 | Shire Hill Quarry, Glossop, Derbyshire
Archaeological Monitoring and Recording
NGR: SK 0540 9445 Planning Authority: Peak District National Park Authority Planning ref: HPK 1197168 PCAS site code: SHQM15 PCAS job no.: 1500
Prepared for Marchington Stone Ltd
by Phil Evans BA (Hons), MCIfA
February 2016 Contents
Non-technical Summary 1 1.0 Introduction 2 2.0 Site location and description 2 3.0 Geology and topography 3 4.0 Planning background 3 5.0 Archaeological and historical background 3 6.0 Archaeological requirement 5 7.0 Fieldwork Methodology 5 8.0 Methodology: post-fieldwork 7 9.0 Timetable and personnel 9 10.0 Health and Safety 9 11.0 Monitoring arrangements 9 12.0 Other factors 10 13.0 Contacts 10 14.0 Insurance 10 15.0 References 10
Figures
Fig. 1: Location of the development site at scale 1:25,000. (OS mapping © Crown copyright. All rights reserved. PCAS licence no. 100049278).
Fig. 2: Area of archaeological Monitoring and Recording. Non-Technical Summary
Pre-Construct Archaeological Services Ltd (PCAS) was requested by Marchington Stone Ltd to prepare a specification for archaeological monitoring and recording to be completed during soil stripping on two previously undisturbed areas at Shire Hill Quarry, Glossop, Derbyshire.
The Cultural Heritage Assessment, undertaken in 2011 in support of the planning application for wining, working and processing gritstone at Shire Hill Quarry, determined that there is the potential for archaeological remains to survive in two previously undisturbed areas at the quarry site.
The potential for Prehistoric activity is considered Moderate due to the discovery of a Bronze Age cremation c. 200m south of the quarry site. A Roman coin, at the same location, and the proximity of the Roman road suggests that there is a low to moderate potential for encountering Roman activity at the quarry site. The potential for encountering activity of Saxon or medieval date has been assessed as negligible and there is a high potential for encountering activity dating to the Post-medieval and modern periods; especially those relating to early quarrying in the late 19th century.
Following submission of the planning application permission was granted subject to a number of conditions, one of which was for archaeological monitoring and recording to be undertaken in the undisturbed areas prior to quarrying activity.
This document sets out the methodology to be employed in undertaking the archaeological monitoring and recording works. 1.0 Introduction
Pre-Construct Archaeological Services Ltd (PCAS) was requested by Marchington Stone Ltd to prepare a specification for archaeological monitoring and recording to be completed during soil stripping on two previously undisturbed areas at Shire Hill Quarry, Glossop, Derbyshire (SK05409445, Fig. 1).
The archaeological potential of the site has previously been investigated via a desk-based cultural heritage assessment (Francis 2011), which was undertaken as part of the EIA process for inclusion in an environmental statement, to inform and accompany the ROMP application.
This document is the specification (written scheme of investigation - WSI) for the methodology to be adopted during archaeological monitoring and recording during soil stripping (topsoil & subsoil) within two undisturbed peripheral zones along the eastern and south-western edges of the site, as required by the planning decision notice (Planning Application Ref: HPK1197168, Condition xii). The archaeological works will be completed ahead of any quarrying activities in these areas to allow for any archaeological remains encountered to be excavated and recorded. It follows current best practice and appropriate national guidance including:
- NPPF, National Planning Policy Framework (2012) & National Planning Practice Guidance
- IFA Code of Conduct (1994 as revised);
- IFA Standards and Guidance for Archaeological Watching Briefs (2008);
- IFA Standard and Guidance for Archaeological Excavation (revised 2008);
- Management of Research Projects in the Historic Environment (MoRPHE)
This strategy is subject to the approval of the Senior Conservation Officer at the Peak District National Park Authority (PDNPA).
2.0 Site Location and Description (Figs. 1 & 2)
Shire Hill Quarry lies on the eastern side of Shire Hill, covers a total of 9.24 hectares, and is centred on NGR SK 0540 9445. The site, of irregular shape, is located to the northeast of the small town of Glossop, Derbyshire, c. 1.9km from the town’s centre (see Fig. 1). The site lies just inside the Peak District National Park: the western boundary of the park passes immediately west of the site, crossing the western slopes of Shire Hill to encircle the town of Glossop (http://www.visitpeakdistrict.com/).
All of the site’s boundaries are demarcated by post and wire fences, with the southern boundary aligned with the contours of the hill. The site is bordered to the north, south and west by dense, deciduous woodland of varying date. To the east of the site are Mossy Lea Farm and its reservoir; and the rolling hills and high peaks of the Peak District National Park, including by the environmentally-sensitive area (SSSI) of the Dark Peak.
The site’s 5.235 hectare extraction area, i.e. the ‘quarry’, incorporates two small peripheral zones: an eastern area, located in the northeastern corner of the main site; and a south-western, linear area, located along the southern limit of the site’s extraction area (Fig. 2). It is these two areas that will be subject to the archaeological monitoring and recording. 3.0 Geology and Soils
The underlying solid geology of the summit and higher slopes of Shire Hill, including the area of the site is Kinderscout Grit. This is described as ‘medium- to very coarse-grained sandstone with shale pellets, feldspathic, massive or cross-bedded and frequently pebbly sandstone, shales and sandy shales, siltstone and sandstone with shale. This is subdivided into the Lower and Upper Kinderscout Grits (BGS 1974; http://www.bgs.ac.uk/). The underlying solid geology of the lower slopes of Shire Hill, including the area between the site boundary and Woodcock Road is the Namurian Age Millstone Grit Group comprising Mudstone, Siltstone and Sandstone. This group is described as ‘fine- to very coarse-grained feldspathic sandstones, interbedded with grey siltstones and mudstones, with subordinate marine shaly mudstone, claystone, coals and seatearths’ (BGS 1974; http://www.bgs.ac.uk/).
4.0 Planning Background
The National Planning Policy Framework (NPPF) came into force in March 2012. This places the responsibility for dealing with heritage assets affected by development proposals with the developer. Developers are required to ‘record and advance understanding of the significance of any heritage assets to be lost (wholly or in part) in a manner proportionate to their importance and the impact, and to make this evidence (and any archive generated) publicly accessible’ (NPPF, s141). Developers are obligated to produce a definitive method of archaeological mitigation to fulfil this requirement.
In 2011 an Archaeology and Cultural Heritage assessment was compiled to inform an Environment Act (1995) Review of Minerals Permissions (ROMP) application for the determination of conditions (Application Number: HPK1197168). The report was requested by the PDNPA’s Mineral Planning Authority as part of the EIA process for inclusion in an environmental statement, to inform and accompany the ROMP application.
The assessment focused on establishing the likely extents of all previous quarrying works on the site. Although the majority of the quarry has undergone previous extraction the proposed extraction area incorporates two peripheral zones potentially destined for future extraction that appear to have been subject to a lesser degree of previous disturbance. These zones, located along the south-western and eastern edges of the redline extraction area were surveyed in detail as part of this assessment.
Following submission of the planning application (HPK1197168) the scheme was granted permission subject to a number of conditions. One of these (Condition 49) states:
No development shall take place within the two undisturbed peripheral zones along the eastern and south-western edges of the site until a programme of archaeological work in accordance with a Written Scheme of Investigation for detailed monitoring of the soil stripping operation within these areas of the site, and the excavation and recording of any archaeological remains that are revealed, has been submitted to and approved by the Mineral Planning Authority in writing.
This document is the WSI proposing the methodology to be employed during the fieldwork and post-excavation reporting phases of the required archaeological programme. It is subject to the approval of the Senior Conservation Archaeologist for the Peak District National Park Authority. 5.0 Archaeological and historical background
A full account of the archaeological and historic background to the site is present in the Cultural Heritage Assessment undertaken in support of Planning Application HPK/1197/168. The assessment found a total of 13 Derbyshire Historic Environment Records listed within the 1km study radius of the proposed extraction works.
There is one Prehistoric record listed on the HER within the 1km study radius. This is a Late Bronze Age cremation contained within a cinerary urn (DHER 3617) found in 1958 at the south-western foot of Shire Hill during construction works for a bungalow at Hurst Croft (Jackson 1968). The urn was recorded at exactly SK 0494 9426, approximately 200m southwest of the site.
Although only one such burial has been recorded on the Shire Hill, its distinctive topography could have made it a focus for other Prehistoric burials and/or landscape features. On this basis, the potential for finding buried prehistoric remains on undisturbed parts of the site is deemed to be Moderate.
The closest Roman record to the site relates to the discovery of a 4th century coin of Emperor Constantine II (316 – 340), who ruled from 337 to 340 AD (DHER 6104). The coin was found in 1965 during construction of the bungalow where the Bronze Age urn was found (DHER 3617). The coin, found c. 200m to the southwest of Shire Hill was ultimately presented to Buxton Museum (Jackson 1968).
At its closest point, a possible Roman Road known as Doctor’s Gate (DHER 3636) passes c. 400m to the northeast of the site. The road, possibly a prehistoric track-way that was improved in Roman times and later as a packhorse trail, passes through Charlesworth parish, between Shelf and Coldharbour Moors (Cockerton 1933; Smithard 1911).
The potential for finding buried Roman remains on undisturbed parts of the site is deemed to be Low to Moderate.
There are no Saxon monuments recorded on the DHER within the 1km study radius. The only known evidence for early medieval occupation of the Glossop area is in the place-names, which have 7th century origins: all ten townships of Glossop have Anglo-Saxon names and all but one of these are listed in Domesday (Sharpe 2005, 110; Scott et al 1973; Tarbutt 1999; Morris 1977). The potential for buried Saxon remains on the site is therefore considered to be negligible.
There are no medieval records listed within the 1km study radius on the DHER. In the Domesday Survey of AD 1086, Glossop belonged to the crown, as part of Longendale, together with several other settlements. In total 12 manors are included in this entry, described as worth 40s before the conquest but as ‘waste’ with woodland only ‘suitable for hunting’ at the time of the survey (Page 1905, 333). This group of settlements, on the edge of the forest that filled the valley, later became the Manor of Glossop (Scott et. al. 1973, 41). Charlesworth also belonged to the Crown at the time of Domesday.
During the medieval period, the site probably formed part of the Royal Hunting Forest of the Peak and was protected by Forest Law. The potential for finding buried medieval remains within undisturbed parts of the site is therefore considered to be negligible.
There are ten DHER monument records of post-medieval date recorded within the 1km study radius. One of these relates to the post-medieval quarry on Shire Hill, which has been in operation on the current site, from at least 1811 until the present day, although successive quarrying appears to have removed all traces of earlier works and structures within the extraction area, with the possible exception of any surviving features in the south-western or eastern peripheries.
Eight of these record site-specific buildings and structures, the closest of which is a former toll house to the southeast of the site. None of these structures would be directly impacted by the extraction proposals. There are records of tenant farmers in Glossop enclosing their lands with dry-stone walls at the end of the 16th century, perhaps suggesting a post-medieval date for the boundary wall located on the eastern edge of the site during the walkover survey undertaken as part of the Cultural Heritage Assessment. There is also late 19th-century cartographic evidence for quarrying on the site, suggesting that any surviving post-medieval archaeology would almost certainly be associated with Shire Hill Quarry. The potential for post-medieval remains to exist within undisturbed parts of the site is therefore considered to be high.
There are no Modern HER records listed within the site or within the 1km study radius. However, the site walkover, undertaken as part of the Cultural Heritage Assessment, has revealed that there is a high potential for Modern remains associated with post-1900 quarrying within undisturbed parts of the site (Eastern and South-western Peripheral Zones).
6.0 Archaeological requirement (Fig. 2)
The fieldwork will be completed in accordance with the methodology detailed in Section 7 below and will be undertaken prior to any quarrying activities.
The potential for archaeological remains surviving within the Eastern and South-western Peripheral Zones has been determined by the previous phase of work (Cultural Heritage Assessment, Francis 2011) and is detailed in Section 5 above.
All soil stripping in both the Eastern Peripheral Zone and South-western Peripheral Zone will require archaeological monitoring.
The archaeological monitoring will ensure any and all encountered archaeological remains will be recorded and plotted, thus creating a record of those deposits disturbed or destroyed by the excavations.
An online record of the project data shall be initiated with the Archaeological Data Service (OASIS database) before fieldwork commences, and completed at the end of the project, including an uploaded digital copy of the report.
7.0 Fieldwork Methodology
Archaeological Monitoring and Recording
The scheme of archaeological works will be undertaken prior to the start of any quarrying activities within the defined areas of archaeological monitoring (Fig. 2).
All archaeological monitoring and recording will be undertaken by suitably qualified/experienced professional archaeologists/PCAS Project or Field Officers.
Unless ground conditions dictate otherwise, all machine excavation of soils will be undertaken using a mechanical excavator fitted with a flat toothless blade. Machine excavation will cease at the first archaeologically significant horizon or the surface of the natural geology, whichever is encountered first. The archaeologist monitoring the ground-works will cause the least possible disruption to the development programme, but at any time may request a pause in groundworks to assess any potential features or deposits; and to allow for the careful cleaning, excavation and recording of any features that have been identified. The archaeologist will keep the groundworkers informed of developments and progress.
If significant archaeological remains are identified, it may be necessary, in liaison with the Senior Conservation Officer, to formulate a strategy for the more complete establishment of the character, distribution, extent, condition, dating and further treatment of any such remains.
Excavated features will then recorded by measured plan and tied into the National Grid using GPS. Section drawings of the features will be drawn at appropriate scales (normally 1:10 or 1:20).
A written record of each significant stratigraphic horizon and archaeological feature will be made on standard PCAS context recording forms. These will be supplemented by a narrative account in the form of a site diary. The archaeologist will pay due attention to the landscape aspect of any exposed remains – both the cultural and the natural landscape – which may require a basic assessment to be made of neighbouring conditions (e.g. visible earthworks in adjacent areas, surface observation, standing buildings, vegetation cover etc).
A digital photographic record, supplemented with colour slide and monochrome photography as appropriate, will be maintained during the course of the archaeological intervention. The photographic record will include:
- specific stages of fieldwork;
- individual features and, where appropriate, their sections;
- groups of features, where relationships are important.
All artefacts will be treated in accordance with UKIC guidelines, First Aid for Finds (Watkinson & Neale 1998). All finds will be bagged and labelled according to the individual deposit from which they were recovered, ready for later cleaning, marking and analysis. A specialist assessment will be made of the artefacts recovered with a view to their potential for further study. Allowance will be made for preliminary conservation and stabilisation of all objects and an assessment of long-term conservation and storage needs.
All finds that qualify as ‘treasure’ under the 1996 Treasure Act (Treasure Act Code of Practice – 2002 revision) will be treated in accordance with the Act; HM Coroner will be informed and the finds will be safely stored. The Derbyshire Finds Liaison Officer may be contacted for advice in the first instance.
**Human Remains**
If human remains are encountered, they will be left in situ where possible, and only disturbed if their continued presence will severely hinder the development processes, or if there are sound academic/scientific justifications for removal. If appropriate, a Ministry of Justice Exhumation Licence will be requested and the local Environmental Health Officer advised.
All reasonable requests of interested parties concerning the methods of removal, re-interral or disposal of the remains and associated items will be complied with, and attempts will be made at all times not to cause offence to interested parties.
All work involving human remains will be carried out according to the standards and guidelines recommended by the British Association of Biological Anthropologists and Osteologists in conjunction with the CfA guidelines. Environmental Sampling
Particular attention will be paid at all times to the presence of lithics-bearing contexts and/or organic contexts, including those devoid of dateable finds, where the presence of burnt flint, charcoal and/or organic material suitable for dating by C14, thermoluminescence (TL), or other dating methods may be retrieved.
Any dated or undated archaeological deposits considered suitable for environmental analysis will be sampled in 40lt quantities where possible. Sampling techniques and methods will comply with those outlined in Environmental Archaeology: A Guide to the Theory and Practice of Methods, from Sampling and Recovery to Post-Excavation (Campbell et al, 2011, 2nd edition).
8.0 Methodology: Post-Fieldwork
Following completion of site works, all archaeological records, environmental samples and finds will be taken to the offices of PCAS prior to processing, dispatch and/or analysis.
Stable finds (e.g. pottery, bone) will be washed, marked and packaged at office of the archaeological contractor prior to dispatch. Unstable finds will be dispatched for remedial conservation as a prelude to assessment, and bulk samples will be dispatched for processing.
PCAS have used the services of a variety of specialists in the past and may use any/all of the following depending on suitability/availability etc:
Archaeological Contractors’:
- University of Leicester Archaeological Services (ULAS) staff – provides a comprehensive service in all areas of post excavation analysis
- Durham University Archaeological Services (DUAS) staff – provides environmental archaeology services.
- York Archaeological Trust (YAT) staff – identification and assessment of registered special finds; X-Ray analysis and Conservation Services.
- Archaeological Project Services (APS) staff – provides a comprehensive service in most areas of post excavation analysis.
Other Freelance Specialists:
- Dr A Irving – specialising in the identification / assessment of post Roman pottery, ceramic building materials & fired clay
- Dr Phil Mills & Dr J Evans – specialising in the identification / assessment of Roman pottery, and Roman & Medieval ceramic building materials
- I Rowlandson – specialising in the identification / assessment of Iron Age & Roman pottery.
- Sarah Percival – specialising in the identification of Pre-Historic pottery /ceramics
- J Young/J Gray – specialising in the identification / assessment of post Roman pottery, ceramic building materials & fired clay.
- M Taylor / M Bamford – specialising in the identification / assessment of waterlogged wood
- Dr D Underhill / J Rylatt– specialising in the identification / assessment of lithic materials and tools. Dr Rachel Tyson – specialising in the identification / assessment of glass.
Dr Rod Mackenzie – specialising in the identification / assessment of waste metal working residues.
Dr K Leahy – specialising in the identification / assessment of post Roman & early medieval artefacts inc. metal work.
J Wood – specialising in the identification / assessment of animal bone & human remains.
Q Mould – specialising in the identification / assessment of leather artefacts
Following receipt of specialist accounts/archive reports and within twelve months of the completion of the fieldwork phase, a fully illustrated and appended text detailing the results of the archaeological monitoring and recording works will be prepared in accordance with current guidelines and sent to the Planning Archaeologist for Derbyshire CC for approval. All electronic submissions will be in single .PDF format. The final report will include the following minimum information:
- A non-technical summary
- Museum accession number, site code and project number
- Planning reference number
- Grid reference, site location, topography and geology
- Archaeological and historical background
- A description and analysis of the fieldwork undertaken
- A geo-referenced location plan at a minimum scale of 1:10,000
- A scaled overall site plan showing the accurately surveyed location of the development site in relation to known and speculated archaeological features (if appropriate)
- Scaled section and plan drawings of archaeological features encountered within the excavated area.
- Discussion and conclusions, including the importance of the findings in local, regional and national basis and a critical review of the effectiveness of methodology
- Tables summarising features and artefacts with full descriptions and brief interpretation
- Specialist artefact and environmental reports, as necessary, with reference made to appropriate published type-series
- Colour photographs, including general views and appropriate detail
- Acknowledgements
- Bibliography of sources used
- Archive deposition location and agreed deposition date
- A summary of the report’s presence and location on the OASIS online database
The data from the project, along with a digital copy of the report, will be uploaded to the Archaeology Data Service OASIS (Online AccesS to the Index of archaeological investigationS) database for public consultation.
Deposition of the report with the HER, where it will be incorporated into their database for public consultation, and uploading the project data to OASIS will be considered as placing the results of the project in the public domain. However, wider publication of the results will be considered, although the content and place of publication will be dependent on what is found, and be subject to discussion with the archaeological advisor to the planning authority. For example, where a significant discovery is made, consideration will be given to the preparation of a short note for inclusion in a local journal.
Working under the terms of the Copyright, Design and Patents Act 1988, the archaeological contractor shall retain full copyright with regard to written, digital and graphic material. However, following project completion, both the commissioning body, Derbyshire HER and the Archaeology Data Service may, in the interest of informing and advancing the profession, make responsible use of the data, provided that any material copied or cited in reports is duly acknowledged and all copyright conditions observed.
Following acceptance of the report, a project archive will be prepared in accordance with the guidelines contained in *Guidelines for the Preparation of Excavation Archives for Long Term Storage* (UKIC 1990) and *Standards in the Museum Care of Archaeological Collections* (Museums and Galleries Commission 1992), and the Derbyshire *Procedures for the transfer of archaeological archives* (Museums in Derbyshire 2003). The receiving archive is Buxton Museum and Art Gallery. The archive has been informed of the intended works, and an accession number will be allocated once the site works are complete. This accession number will be used to deposit the entire archive in the event of a finds archive being generated in the course of the fieldwork; should the proposed works generate no finds, archiving procedure is as set out above: a single bound copy of the report plus a digital copy in pdf/a format will be deposited with the Derbyshire HER, and a copy of the report uploaded to the OASIS database.
9.0 Timetable and Personnel
The anticipated start date for the topsoil stripping is currently unknown, however the archaeological works will be completed ahead of any quarrying activities in the Eastern and South-western Peripheral Zones.
A full report on the results of the project will be submitted within 12 months of the completion of the groundworks.
The site team will include an experienced Project Officer as a minimum. Details of the site team and CVs will be provided if required.
10.0 Health and Safety
All work will be carried out in compliance with the Health and Safety at Work Act 1974 and its related regulations and codes of practice. Employees and sub-contractors of Pre-Construct Archaeological Services Ltd will perform their duties in accordance with company safety policy (revised 2011). Where PCAS employees are temporarily engaged at other workplaces, they are to respect relevant local regulations, both statutory and as imposed by other employers within the Health and Safety at Work Act (1974).
A site specific risk assessment will be prepared prior to any site works taking place.
11.0 Monitoring arrangements
Internal monitoring will be the responsibility of PCAS Director Will Munford. The Snr Conservation Archaeologist for PDNPA will be informed, with not less than fourteen days notice, of the start of the archaeological intervention. She will be kept informed of any unexpected discoveries and regularly updated on the project’s progress, and will be free to visit the site by prior arrangement with the site director.
All phases of fieldwork shall be carried out in accordance with the approved WSI, with any variations to the specification being agreed in writing with the Snr Conservation Archaeologist for PDNPA.
12.0 Other factors
Any potential financial outlay which may be activated over and above rudimentary costs (i.e. fieldwork, basic reporting and archive arrangements) will be been calculated as provisional sums/contingencies.
13.0 Contacts
Ken Smith, Cultural Heritage Manager 01629 816206 Will Munford, Director, PCAS 01522 703 800
14.0 Insurance
Pre-Construct Archaeological Services Ltd has the following insurance cover:
Employers’ Liability: £10,000,000 Public Liability: £5,000,000 Professional Indemnity: £1,000,000
15.0 References
Campbell et al., 2011, Environmental Archaeology: A Guide to the Theory and Practice of Methods, from Sampling and Recovery to Post-Excavation (2nd edition), English Heritage
Ordnance Survey, 2008, Chesterfield and Alfreton: Explorer 1:25 000 Series no. 269. Ordnance Survey, Southampton.
Francis, K. 2011. Archaeology and Cultural Heritage: Shire Hill Quarry, Glossop, Derbyshire. Report No. 808 Rev 2
Websites: http://archaeologydataservice.ac.uk/archiveDS/archiveDownload?t=arch-881-1/dissemination/pdf/EUS_Texts/Alfreton/Alfreton.pdf http://www.ambervalley.gov.uk/environment-and-planning/planning/community-planning/ancient-monuments.aspx http://domesdaymap.co.uk/ http://www.heritagegateway.org.uk/Gateway/ http://list.english-heritage.org.uk/mapsearch.aspx http://mapapps.bgs.ac.uk/geologyofbritain/home.html
Planning documents accessed online at: http://pam.peakdistrict.gov.uk/?r=HPK1197168&q=HPK1197168&s=4981602 Figures Figure 1. Site location. Site extraction boundary in red. Based on the 1:25,000 OS Explorer map, sheet Ol1. © Crown copyright. All rights reserved. PCAS licence No. 100049278.
Figure 2. Plan detailing the areas where archaeological monitoring and recording works are to be undertaken.
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aeb693ea6f5fbc3dd65e584b736f1dcd759e1b47 | | CODE No | NPDD0202 085 | P.FILE No. | 2978 | |---------|--------------|------------|------| | OS MAP No. | 1672 | GRID REF | 1677 7290 | | APPLICANT | clo AGENT | D Sutherland Architects | 2 Curzon Terrace | | | Mr & Mrs L Hull-Bailey | Litton Mill | | | | Cressbrook Hall | BUXTON | | | | Cressbrook | Derbyshire | | | | NR BUXTON | POSTCODE | POSTCODESK17 8SR | | | Derbyshire | Tel No. | 01298 871100 | | APPL TYPE | Full | PROPOSAL | Conversion of dwelling to 2 holiday units | | LOCATION | Victorian Gardens, Cressbrook Hall, Cressbrook | | | PARISH | Litton | | | ADVERT DATE | 8 Mar 2002 | LAST ADVERT DATE | 29 Mar 2002 | | CONSTRAINTS | Conservation Area | | | CONSULTATIONS | Litton Parish Council | DATE SENT | 27 Feb 2002 | | | Derbyshire Dales District Council | DATE REPLY | 27 Feb 2002 | | | Derbyshire County Council (Highways) | | 27 Feb 2002 | | | | | 19/3/02 | | | | | 11/4 | | | | | | | COMMITTEE | | | | | DECISION | | | | | APPEAL | | | | | Date lodged | | | | | Decision | | | | | Date | | | |
**Send decision Notice**
Nether Dale Farm
Mural Date
5/07/02
**13 WEEKS DATE**
29 May 2002 Date: 12th February 2003
To: PDNPA
Re: Victoria Gardens
For the Attention of: Kevin Wheeldon
The number of pages to be sent, including this, is 2
(Please telephone if you have not received the number of pages indicated)
I have been trying to contact you for several days now to discuss the enclosed. As you are aware, the builders are on site and we need to obtain a decision on this fairly minor alteration as a matter of some urgency as it is holding up progress.
There is an existing, small opening on the East Elevation. The original proposal was to replace that with a new opening approx. 900mm sq. You were going to come back to me on that about a week ago and so far I have not heard from you. The current proposal is to keep the width of the existing opening and increase its depth to 900mm as shown on the enclosed sketch.
I am assuming, as I understand that you will be unavailable from tomorrow for the following 2 days and then on leave for some time after that, that if I do not hear from you before the end of today that you agree to this fairly minor amendment and I will instruct the builders to proceed accordingly.
Yours faithfully,
David Sutherland
[Handwritten note: 12/2/2003 - left answering machine message on David Sutherland mobile that the minor amendment was acceptable.]
copy Mr & Mrs Hull Bailey PROPOSED ALTERATION - VICTORIA CINNS, CRESSBROOK. Dear Sirs,
Proposed Conversion of Existing Buildings to Two Holiday Cottages, Cressbrook Hall, Cressbrook.
Following my letter of 19th July 2002 enclosing drawing 1229/04 and our subsequent conversation re the above, I write to confirm your agreement to the following minor amendments to the scheme:-
1. Both end walls of the Conservatory part of the building are to be constructed of limestone instead of glass, as shown.
2. All of the Conservatory roof will be glazed externally, though the Bedrooms will be underdrawn internally in order to meet the current insulation requirements of the Building Regulations.
3. You agree to the inclusion of the former 'tank room' in the scheme, as shown, for use as an additional Bedroom.
4. The roof of the masonry part of the building will be re-clad in natural blue slates, not Staffordshire blue tiles, and the pitch will be increased from the existing 20° to 30°.
Yours faithfully,
David Sutherland
Partner - David Sutherland BSc BArch RIBA 19th July 2002
Peak District National Park Authority, Aldem House, Baslow Road, Bakewell, Derbyshire, DE45 1AE.
FAO Kevin Wheeldon
Dear Sirs,
Proposed Conversion of Existing Buildings to Two Holiday Cottages, Cressbrook Hall, Cressbrook.
Following our recent conversations re the above I enclose a preliminary, revised drawing of the scheme, showing the limestone end walls to the Conservatory. All of the Conservatory retains the glazed roof, though the Bedrooms will be underdrawn internally in order to comply with the latest Building Regulations.
We have also extended the scheme to include the existing former water tank at the eastern end of the building. This was originally roofed as shown on the enclosed, though the roof is currently missing from this area. The inclusion of this room involves the creation of 2 new window openings, again as shown.
The existing masonry part of the building is clad in concrete plain tiles. The approval stipulates Staffordshire blue tiles, but the original building was roofed in blue slate. Can we revert to blue slates? Also - the pitch of the existing roof over the masonry building is approx. 20°. In order to ensure water-tightness, we would like to increase this to nearer 30° which would raise the height of the parapet wall between the Conservatory and the rear section. What are your views on this?
I am away on holiday until the 29th July, but I would be grateful if you could give these points some thought before I get back so that I can progress the detail drawings on my return.
Many thanks.
Yours faithfully,
David Sutherland
Partner - David Sutherland BSc BArch RIBA ENFORCEMENT RECORD CARD
This card should be filed immediately in front of the decision notice which in turn should be in front of a set of approved plans.
The following amendments have been formally agreed by the planning officer since the issue of the decision notice:
| DATE | DETAILS | |--------|---------| | 12.2.2003 | Kid agreed minor amendment to window opening in Juliet balcony - see attached FTA from David Sutherland dated 12.2.2003 |
The following conditions have been formally complied with since the issue of the decision notice:
| DATE | COND.NO. | DETAILS | |------|----------|---------| | | | | | DATE | INSPECTION | PROGRESS | DEPARTURES | |-------|------------|----------|------------| | 17-9-02 | 03 | Stone sample refused. Size + layout ok. | | | 18-9-02 | 03 | Stone sample approved. (See photos) | |
**KEY DATES TO NOTE**
| DATE | DETAILS | |------|---------|
**KEY FACTORS TO WATCH**
| DETAILS | |---------| PLANNING DECISION NOTICE
To: Mr & Mrs L Hull-Bailey c/o D Sutherland Architects 2 Curzon Terrace Litton Mill Buxton Derbyshire SK17 8SR
THIS NOTICE RELATES TO PLANNING CONTROL ONLY, ANY OTHER STATUTORY CONSENT MUST BE OBTAINED FROM THE APPROPRIATE AUTHORITY
TOWN & COUNTRY PLANNING ACTS & GENERAL DEVELOPMENT ORDER
In pursuance of the powers vested in the Peak District National Park Authority under the above Acts and Order, and with reference to your application for full planning permission, details of which are as follows:
Office Code No. NP/DDD/0202/085 Date received: 22 February 2002 Proposal: Conversion of dwelling to 2 holiday units Location: Victorian Gardens, Cressbrook Hall, Cressbrook Parish: Litton
THE DECISION
NOTICE IS HEREBY GIVEN THAT PERMISSION FOR THE PROPOSED DEVELOPMENT in the manner described on the application and shown on the accompanying plans and drawings is
GRANTED subject to the following conditions:
1. The development hereby permitted shall be begun within 5 years from the date of this permission.
2. This permission relates solely to the use of the premises hereby approved for short-let holiday residential use ancillary to Cressbrook Hall. The property shall not be occupied by any one person for a period exceeding 28 days in any calendar year. The existing house and the approved holiday accommodation shall be maintained as a single planning unit.
The owner shall maintain a register of occupants for each calendar year which shall be made available for inspection by the National Park Authority on request.
3. The development hereby permitted shall not be carried out otherwise than in complete accordance with the submitted plans, subject to the following conditions or modifications:
(i) The external face of the plinth wall to the conservatory shall be clad with natural rubble limestone, coursed to match the existing building.
Prior to the erection of the external walls a sample panel of at least 1.0 metre square shall be constructed on the site. The National Park Authority shall be informed on the completion of the sample panel which shall then be inspected. All subsequent walling shall match the sample panel in terms of stone colour, size, texture, coursing and pointing, subject to whatever reasonable modifications may be specifically required in writing by the Authority. If necessary the Authority shall request the construction of another sample panel incorporating the required modifications.
Signed
Date 19 APR 2002
Attention is called to notes at the end of this Decision Notice (ii) All window and door frames shall be recessed a minimum of 50 mm to match to depth of the original frames.
(iii) Prior to the commencement of development a scheme for the external finish of all timberwork, including doors and windows, shall be submitted to and approved in writing by the National Park Authority. Once approved the development shall be carried in complete accordance with these details and the timberwork shall be permanently so maintained thereafter.
(iv) The external doors and windows shall be of timber construction.
(v) All window openings shall be provided with natural gritstone lintels and sills, and all door openings provided with natural gritstone lintels.
(vi) The rainwater goods shall be either timber or cast metal, painted black. The gutters shall be fixed directly to the stonework with brackets and without the use of fascia boards. There shall be no projecting or exposed rafters.
(vii) The roof verge(s) shall be flush cement pointed, with no barge boards or projecting timberwork.
(viii) The flue pipes shall not exceed 200 mm diameter as shown on the submitted plan and shall be painted matt black at the time of erection.
4. The proposed holiday units shall not be taken into use until the existing vehicular access to the unclassified road has been provided with 2m x 33m (or as may be agreed) emerging visibility sightlines in each direction, all to the satisfaction of the National Park Authority; the area in advance of the sightlines being maintained clear of all obstructions greater than 1m (600 mm in the case of vegetation) in height, relative to adjoining carriageway level. Appropriate signage should be installed alongside the access for the benefit of holiday lettees, designed and located all to the satisfaction of the National Park Authority. Before the commencement of the development hereby approved, details of the access improvements shall be submitted to and agreed in writing by the Authority. Once approved, the scheme shall be carried out in accordance with the agreed details prior to the occupation of the holiday units hereby approved.
5. Parking and manoeuvring space shall be provided within the site curtilage designed, laid out and construction to the satisfaction of the Authority. Before the commencement of the development hereby approved, details of the parking/manoeuvring spaces shall be submitted to and agreed in writing by the Authority. Once approved, the scheme shall be carried out before the occupation of the holiday units hereby approved. The parking/manoeuvring spaces shall then remain unobstructed for use at all times.
Reasons for Conditions:
1. To comply with Sections 91, 92, and 93 of the Town and Country Planning Act 1990 (which requires the National Park Authority to reconsider the proposal afresh after a period of years).
2. Permission has been granted in accordance with policy RT3 of the Structure Plan which permits the conversion of traditional buildings to holiday accommodation. Conversion to a permanent dwelling would be contrary to the Structure Plan policies.
3. To ensure a satisfactory detailed design, which is in character with the local building tradition and the character of the National Park.
4. To ensure that the means of access is of a satisfactory standard, for safety and for the convenience of highway users.
5. To ensure that adequate space is provided for vehicles to park and turn clear of the highway, so that it is safe and convenient for highway users. Footnote:
This decision notice relates to the granting of planning permission for the proposed development. It does not grant listed building consent, which must be sought and obtained from the National Park Authority before any development begins.
Note: The following policies have been taken into account in determining this application.
Relevant Structure Plan policies include: GS1, C2, C4, C9, RT3, T1.
Relevant Local Plan policies include: LC4, LC5, LC8, LR1, LR6, LT11.
STATEMENT OF APPLICANT'S RIGHTS ARISING FROM THE REFUSAL OF PLANNING PERMISSION OR FROM THE GRANT OF PERMISSION SUBJECT TO CONDITIONS
Appeals to the Secretary of State
- If you are aggrieved by the decision of your local planning authority to refuse permission for the proposed development or to grant it subject to conditions, then you can appeal to the Secretary of State for the Environment under Section 78 of the Town and Country Planning Act 1990.
- If you want to appeal, then you must do so within 6 months of the date of this notice, using a form which you can get from the Planning Inspectorate at 3/02 Kite Wing, Temple Quay House, 2 The Square, Temple Quay, Bristol BS1 6PN, telephone No. 0117 372 8428.
- The Secretary of State can allow a longer period for giving notice of an appeal, but he will not normally be prepared to use this power unless there are special circumstances which excuse the delay in giving notice of appeal.
- The Secretary of State need not consider an appeal if it seems to him that the local planning authority could not have granted planning permission for the proposed development or could not have granted it without the conditions they imposed, having regard to the statutory requirements, to the provisions of any development order and to any directions given under a development order.
- In practice, the Secretary of State does not refuse to consider appeals solely because the local planning authority based its decision on a direction given by him.
Purchase Notices
- If either the local planning authority or the Secretary of State for the Environment refuses permission to develop land or grants it subject to conditions, the owner may claim that he can neither put the land to a reasonably beneficial use in its existing state nor render the land capable of a reasonably beneficial use by the carrying out of any development which has been or would be permitted.
- In these circumstances, the owner may serve a purchase notice on the Council (District Council, London Borough Council or Common Council of the City of London) or, where the land is situated in a National Park, the National Park Authority for that Park in whose area the land is situated. This notice will require the Council or Authority to purchase his interest in the land in accordance with the provisions of Part VI of the Town and Country Planning Act 1990.
4. FULL APPLICATION – CONVERSION OF DWELLING TO 2 HOLIDAY UNITS, VICTORIAN GARDENS, CRESSBROOK HALL, CRESSBROOK, LITTON (NP/DDD/0202/085, P.2978, 22.2.02, 1677 7290/KW)
Relevant Structure Plan policies include: GS1, C2, C4, C9, RT3, T1.
Relevant Local Plan policies include: LC4, LC5, LC8, LR1, LR6, LT11.
The site is the former walled vegetable garden to Cressbrook Hall situated in an isolated position 150 metres west of the Hall. Vehicular access is via a 160 metre long track whose access emerges at the top of a steep lane at the western end of Cressbrook.
The site is enclosed by a high brick wall and originally served as the vegetable garden and orchard to Cressbrook Hall. The original buildings comprised a 29 m long, narrow-spanned single-storey, stone lean-to building with a wider-spanned, greenhouse/conservatory on the southern side. The present greenhouse section has been rebuilt and covers about 75% of the original footprint. The buildings have had several uses including estate workers' accommodation. In the early 1980s the present owners acquired Cressbrook Hall with its grounds and sought to refurbish and restore the gardens. Approval was granted in 1988 for the re-use of the limestone part of the building as a horticultural worker's dwelling. This has now ceased.
Proposed is the conversion of the stone building and restoration of the glazed conservatory along the entire length of the south elevation, to form two holiday units operating in conjunction with the existing hotel business at Cressbrook Hall. The rebuilt conservatory section is of a traditional design and significant improvement on the later modern replacement. Subject to minor design amendments, therefore, the scheme is considered to be acceptable. Although there is an existing access which has had varying levels of usage in recent years, it is likely that the Highway Authority would wish to see some improvement in visibility at the access entrance, particularly in view of the proposed holiday use. Your officers consider that improvements could be achieved by lowering the walls either side of the access entrance. Subject to the views of the Highway Authority, therefore, the scheme is considered to be acceptable.
Highway Authority – reconsulted on use of existing access. No reply to date.
District Council – no reply to date.
Parish Council – fully supports the application.
Human Rights
Any human rights issues have been considered and addressed in the preparation of this report.
APPROVE –
1. / Holiday occupancy condition.
2. / Minor design amendments.
3. / Agree external finish of timber conservatory framing.
4. / Highway conditions.
List of Background Papers (not previously published)
Nil THE REPORT OF THE ASSISTANT NATIONAL PARK OFFICER - HEAD OF PLANNING - DELEGATED ITEMS WAS THEN SUBMITTED
45/02
1. RESERVED MATTERS - DEMOLITION OF GARAGE BUILDING, CONVERSION OF STONE BUILDING TO DWELLING AND ERECTION OF 3 NEW DWELLINGS AND GARAGING, FORMER BUS DEPOT, CALVER CROSSROADS, CALVER (NP/DDD/0202/050, P.3745, 1.2.2002, 2398 7486/KW)
Condition 6 was amended to state that the drystone boundary walling should be done in limestone.
Mrs Potter abstained from the voting.
RESOLVED:
That the application be APPROVED subject to the conditions set out in the report and the above amendment.
46/02
2. FULL APPLICATION - DEMOLITION OF EXISTING WOODEN DWELLING AND ERECTION OF STONE DWELLING, THE BUNGALOW, MIRES LANE, GREAT LONGSTONE, (NP/DDD/0202/064, P.7367, 20.02.02, 2060 7155/CLG)
It was reported that the Parish Council had been reconsulted on amended plans and that they still recommended refusal. They stated that they would prefer a bungalow or smaller building and that the proposed building was not on the footprint of the original building and was overpowering in size and position on the plot.
RESOLVED:
That the application be APPROVED subject to the conditions set out in the report.
47/02
3. FULL APPLICATION - EXTENSION TO DWELLING, DENE COTTAGE, LITTLE LONGSTONE (NP/DDD/0102/043, P.1492, 28.1.02, 1891 7167/JFB)
Cllr Mrs Crowther reported that the Parish Meeting agreed with the officers recommendation.
RESOLVED:
That the application be REFUSED for the reasons set out in the report.
48/02
4. FULL APPLICATION - CONVERSION OF DWELLING TO 2 HOLIDAY UNITS, VICTORIAN GARDENS, CRESSBROOK HALL, CRESSBROOK, LITTON (NP/DDD/0202/085, P.2978, 22.2.02, 1677 7290/KW)
RESOLVED:
That the application be APPROVED subject to the conditions set out in the report.
49/02
5. FULL APPLICATION - CONVERSION OF BARN TO WORKSHOP, NEWCLOSE FARM, OVER HADDON (NP/DDD/0102/059, P.8108, 31.01.02, 2093 6659/JK)
The Planning Officer reported that the proposed discussions with the Highway Authority and agent concerning the access had not yet been held. Therefore he suggested that the application could be deferred to allow the consultation to take place. This was agreed.
RESOLVED:
That consideration of the application be DEFERRED for further consultation. Dear Mr Harrison
Proposed Conversion of Existing Dwelling to 2 No Holiday Units - Cressbrook Hall (NC), Cressbrook, Litton
Thank you for the additional information faxed to this office on 25 March 2002, further to my highway response of 14 March 2002.
It would appear that the application site is served by a vehicular access to the unclassified road which is separate to the ones which serve Cressbrook Hall and whilst this access has restricted emerging visibility, highway objection could not be sustained, for the reasons given in my initial response. Nevertheless, I am concerned for the highway safety of future lettees (unused to the access’s shortcomings) and other road users and therefore consider that the inclusion of the following recommended condition in any consent is justified:
The proposed holiday units shall not be taken into use until the existing vehicular access to the unclassified road has been provided with 2m x 33m (or as may be agreed) emerging visibility sightlines in each direction, all to the satisfaction of the National Park Authority; the area in advance of the sightlines being maintained clear of all obstructions greater than 1m (600mm in the case of vegetation) in height, relative to adjoining carriageway level. Appropriate signage should be installed alongside the access for the benefit of holiday lettees, designed and located all to the satisfaction of the National Park Authority.
NB: Previous recommended condition 2 still applies!
Yours sincerely
Graham Hill Area Development Manager - North Western Dear Madam
APPLICATION CODE NO. NPDDD0202 085 Conversion of dwelling to 2 holiday units Victorian Gardens, Cressbrook Hall, Cressbrook, Litton
I enclose one copy of the above application.
You should return one copy of this letter containing your observations and comments to this office within 28 days. A further copy of this letter containing your observations should be forwarded to Derbyshire Dales District Council, Planning Dept, Town Hall, Matlock, Derbyshire DE4 3NN.
The Authority currently operates a procedure that allows individuals or organisations to address members at meetings of the committee or sub-committees. Details of this procedure can be obtained from Committee Services at the National Park Office.
Yours faithfully
J W Davies Development Control Service Manager Parish Council / Town Council Recommendation and any Comments:
Litton Parish Council - The Parish Council fully supports this application.
In any correspondence, please quote our reference and the application code no. 11th April, 2002.
Peak District National Park Authority Aldem House Baslow Road Bakewell DE45 1AE
Dear Sirs,
CONSULTATION RESPONSES FROM DERBYSHIRE DALES DISTRICT COUNCIL
The following applications are to be recommended for approval subject to no overriding objections being raised by the Highway Authority. For the avoidance of doubt, whilst the District Council would not object to amendments to design or materials, or conditions regarding landscaping matters where appropriate, it would not support a refusal on design or landscape grounds for the applications listed.
NP/DDD/0202/83 (Bradwell - AE) Erection of Conservatory, 2 Main Road, Bradwell for Mr. Bancroft NP/DDD/0202/85 (Cressbrook - AE) Conversion of Dwelling to 2 Holiday Units, Victorian Gardens, Cressbrook Hall, Cressbrook for Mr. and Mrs. L. Hull-Bailey NP/DDD/0202/86 (Eyam - NP) Demolition of Garage and Erection of 3 Dwellings, Townhead Garage, Eyam for Mr. and Mrs. T. Hill NP/DDD/0202/87 (Bakewell - NP) Extension to Dwelling to Form Breakfast Room and Conversion of Garage to Study, Guiseley Cottage, Shutts Lane, Bakewell for Mr. M.J. Haslam NP/DDD/0202/88 (Bakewell - NP) Conversion of Outbuildings to Visitor Accommodation and Erection of Car Port, Coombs Hay, 16 Burre Close, Bakewell for Mr. and Mrs. W. Forrester NP/DDD/0202/90 (Bakewell - NP) Extension to Dwelling, Sunningdale, Wye Bank, Bakewell for Mr. J. Tranter NP/DDD/0202/91 (Over Haddon - NP) Extension to Existing Cubicle Shed, Melbourne Farm, Monyash Road, Over Haddon for A. and J.M. Bunting NP/DDD/0302/92 (Bakewell - NP) Alterations and Extension to Dwelling, The West Lodge, Holme Lane, Bakewell for Mr. and Mrs. R.F. Fitzpatrick NP/DDD/0302/93 (Bakewell - NP) Listed Building Consent - Alterations and Extension to Dwelling, The West Lodge, Holme Lane, Bakewell for Mr. and Mrs. R. F. Fitzpatrick NP/DDD/0302/94 (Hartington Middle - AE) Installation of Radio Antenna on Gable End, Telephone Exchange, Parsley Hay for M. Jones NP/DDD/0302/95 (Curbar - NP) Alterations and Extensions to Dwelling Including New Conservatory, The Croft, The Bent, Curbar for Mr. and Mrs. P. Ivey
/Cont'd Over ...........
Head of Planning & Development Services, Dave Brooks BSc(Eng), C.Eng, MICE, MIMgt. Town Hall, Matlock, Derbyshire, DE4 3NN. Extension to Dwelling to Form Utility Room and Toilet, Dunmore Cottage, Hollowgate, Froggatt for Mr. and Mrs. M. Davidson Conversion of Barn to Dwelling, Home Farm, Main Road, Taddington for Mrs. B. Hodgkinson Conversion of Former School Lavatories to Additional Living Accommodation, The Old School, Birchover for Mr. A. Miller Extension to Dwelling to Form Conservatory and Workroom/Store, Church Cottage, The Green, Parwich for Mr. R. Tresidder and Ms. L. Coyne Relocation of Gateway to Create Safer Access, Field NE of Ashford Lane, Ashford for Mr. J. Sheldon Extension and Improvements to Car Park and Recycling Centre, Bank Top, Winster for Winster Parish Council Extension Above Existing Garage to Form Extra Bedrooms, High View, Coggers Lane, Hathersage for Mr. and Mrs. W. Hanley Extension Over Existing Garage to Form Bedroom, The Old Police House, Townend, Bradwell for Mr. A.P. Allen Demolition of Existing Garage and Replace With Extra Bedrooms and Erection of New Porch and Detached Garage, El Belles, Smalldale, Bradwell for Mr. G. Cooper Extension to Dwelling and Conversion of Loft to Additional Living Accommodation, Netherdale, 2 Moor Lane, Great Longstone for Mr. and Mrs. R. Broome Installation of Awning Over Shop Window, Post Office, Pilsley for Mrs. M.A. Cooper Conversion of Barn to Dwelling, Hobson Farm, Main Road, Flagg for Mr. J.W. Naylor Change of Use of Grazing Land to Domestic Garden, Digby House, Digmire Lane, Thorpe for Mr. A. Chapman Erection of Garden Store and Wood Shed, Ellers Knowl, Hassop for G. Shaw Erection of Conservatory, 11 Brookfields, Calver for Mr. and Mrs. Fergason Erection of Garage and Store Shed, Black Harry House, Wardlow for Mr. K. Dormer Removal of Outbuilding and Replace with Extension to Form Kitchen and Shower Room, Morley Lodge, Main Road, Hathersage for Mr. W. Moss Creation of Car Parks (Reserved Matters), Cliff College, Curbar for Cliff College Listed Building Consent - Demolition of Garden Wall from Arch to the Summer House and Rebuilding of Wall in its Original Position, Highlow Hall, Highlow for Mr. B. Walker Extension to Dwelling, 6 Derwent View, Calver Road, Baslow for Mr. and Mrs. Carroll Listed Building Consent - Erection of Garages and Ancillary Landscape Works, Mount Pleasant Farm, Middleton-by-Youlgreave for Mr. and Mrs. S. Maher Erection of Garage, Mount Pleasant Farm, Middleton-by-Youlgreave for Mr. and Mrs. S. Maher The following District Council responses differ from those above:
NP/DDD/0202/82\
(Little Hucklow - AE)\
Erection of Disabled Persons Dwelling with Underground Hydrotherapy Pool, Ye Olde Bull's Head, Little Hucklow for Mr. and Mrs. P. Denton - No objections, subject to the dwelling being ancillary to the occupation of the main dwelling.
NP/DDD/0202/84\
(Great Longstone - AE)\
Demolition of Existing Wooden Dwelling and Erection of Stone Dwelling, The Bungalow, Mires Lane, Great Longstone for Mr. B. Edwards - Fully support.
NP/DDD/0202/89\
(Baslow - NP)\
Erection of Conservatory, Lindum House, Stanton Ford, Baslow for Mr. and Mrs. Hallis - No objections subject to improved siting/design.
NP/DDD/0302/100\
(Chelmorton - AE)\
Demolition of Bungalow and Haulage Garage and Erection of 4 Dwellings, Ponderosa, Main Street, Chelmorton for Mr. A. Sheldon - No objections to a local needs housing development in principle or to the number of units proposed, but the layout would need to be considerably improved.
NP/DDD/0302/101\
(Eyam - NP)\
Advertisement Consent - Erection of Shop Sign, Eyam Tea Rooms, The Square, Eyam for Mr. C. E. Joyce - No objections to a timber painted sign but Pvc sign not appropriate.
NP/DDD/0302/107\
(Ashford - AE)\
Conversion of Agricultural Buildings to Form Office Accommodation, Highfield Farm, Ashford for Mr. M. Brocklehurst - Fully support.
NP/DDD/0302/110\
(Wardlow - AE)\
Erection of Industrial Building for the Manufacturing of Plastic Tubes and Sections, Petrol Filling Station, Wardlow Mires for Jayplas Extrusions Ltd. - Oppose.
NP/DDD/0302/125\
(Elton - NP)\
Listed Building Consent - Internal and External Refurbishment of Dwelling, Red Lion Cottage, Elton for Nottingham Community Housing Association - No objections subject to new windows being sliding sash to match the existing i.e. not top opening.
NP/DDD/0302/126\
(Youlgreave - NP)\
Erection of Summer House and Mower Shed, 1 Coldwell End, Youlgreave for Mr. J. Raine - Measures to reduce the impact of the building are warranted.
Yours faithfully,
P. L. WILSON\
Planning Services Manager
c.c. Councillors Mrs. Crowther, Dring and Mrs. Bevan PEAK DISTRICT NATIONAL PARK AUTHORITY PLANNING APPLICATIONS NOTICE OF APPLICATIONS FOR PLANNING PERMISSION OR LISTED BUILDING CONSENT
NPDDD0202085 - Mr & Mrs L Hull-Bailey, Victorian Gardens, Cressbrook Hall, Cressbrook, Litton. Conversion of dwelling to 2 holiday units. This site lies within Cresswell Conservation Area.
NPDDD0202086 - Mr & Mrs T. Hill, Townhead Garage, Eyam. Demolition of garage and erection of 3 dwellings. This site lies within Eyam Conservation Area.
NPDDD0302092 - Mr & Mrs R. F. Fitzpatrick, The West Lodge, Holme Lane, Bakewell. Alterations and extension to dwelling. This building is listed as being of architectural or historic interest and lies within Bakewell Conservation Area.
NPDDD0302093 - Mr & Mrs R. F. Fitzpatrick, The West Lodge, Holme Lane, Bakewell. Listed Building Consent - alterations and extension to dwelling. This building is listed as being of architectural or historic interest and lies within Bakewell Conservation Area.
NPDDD0302096 - Mr & Mrs M. Davidson, Dunmore Cottage, Hollowgate, Froggatt. Extension to dwelling to form utility room and toilet. This site lies within Froggatt Conservation Area.
NPDDD0302097 - Mrs B. Hodgkinson, Home Farm, Main Road, Taddington. Conversion of barn to dwelling. This site lies within Taddington Conservation Area.
NPDDD0302098 - Mr A. Miller, The Old School, Birchover. Conversion of former school lavatories to additional living accommodation. This site lies within Birchover Conservation Area.
NPDDD0302101 - Mr C. E. Joyce, Eyam Tea Rooms, The Square, Eyam. Advertisement Consent - erection of shop sign. This site lies within Eyam Conservation Area.
NPDDD0302103 - Winster Parish Council, Bank Top, Winster. Extension and improvements to car park and recycling centre. This site lies within Winster Conservation Area.
Copies of the applications may be inspected at the National Park Office during office hours for the next 21 days.
If you wish to comment please write to the National Park Officer, Peak District National Park Authority, Aldern House, Baslow Road, Bakewell, Derbyshire within that time. Please note that the Authority now permits members of the public and consultees to address its committees, including those which determine planning applications. Please contact this office if you require details. Dear Mr. Harrison
Proposed Conversion of Existing Dwelling (Including Conservatory) to 2 No Holiday Units - Cressbrook Hall (NC), Cressbrook, Litton
The application site would appear to have two possible means of vehicular access to/from the unclassified country road (UCR) which serves Cressbrook Hall and although not obvious from the submitted details, all indications are that the westernmost access (situated adjacent to Top Lodge) is the intended one. Whilst this access is superior to the second one it still does not meet current national guidelines in terms of visibility and geometry. However, it is considered that there would be no increase in its vehicular use by implementation of the proposal and, on this basis, it is considered that highway objection could not be sustained.
Please include the following recommended conditions, in any consent:
1. Of the two vehicular accesses which serve Cressbrook Hall, only the westernmost one shall be used to serve the application site. Appropriate signage should be installed alongside the access for the benefit of holiday letees, designed and located all to the satisfaction of the National Park Authority.
2. Parking and manoeuvring space as appropriate shall be provided within the site curtilage, designed, laid out and constructed all to the satisfaction of the National Park Authority; the facility being maintained free from any impediment to its designated use, throughout the life of the proposed development.
Yours sincerely,
Graham Hill Area Development Manager - North Western AN APPLICATION HAS BEEN MADE
by Mr & Mrs L Hull-Bailey
for Conversion of dwelling to 2 holiday units
at Victorian Gardens, Cressbrook Hall, Cressbrook, Litton
This site lies within Cressbrook Conservation Area
Ref. No. NPDDD0202085 Start Date 8/03/2002 P. 2978 Expiry Date 29/03/2002
A copy of the application and plans may be inspected during office hours for the next 21 days following the date of this notice at the National Park Authority Office.
A copy has also been sent to the District / Borough Council and Parish Council / Meeting for comment. If you wish to make any comments please write to the National Park Authority Office before the expiry date. Please note that the Authority now permits members of the public and consultees to address its committees, including those which determine planning applications. Please contact this office if you require details.
National Park Officer, Peak District National Park Authority, Aldern House, Baslow Road, BAKEWELL, Derbyshire, DE45 1AE
Tel. 01629 816200 DERBYSHIRE COUNTY COUNCIL HIGHWAYS COMMENTS
APPLICATION CODE No. NP/DDD/0202/085 DATE: 28 Feb 02 29/12/2002 Planning recall 1290-00 arranged.
KW/81/24/2002 - People already rehearsed in premises discussing with JRS, O.K., subject to H.A. comments. Given premises used it could be agreed that there is little interference of the existing access. However, in view of change in user type (i.e. holding) I think the H.A. will want to see some layout of the boundary wall to provide in initial design. In my view, layout of the higher wall for about 4m + spigot wall which is some increase (to statutory fence - see photo) until just about 100 ft + leading to incline in height + change of self same fence in nose on top side for about 6m to match with spigot 4m + 300m linear.
See plans - this must of laying should give reasonable visibility in both directions + traffic in opposite direction is in nature of minor lane and prop. namely fairly steady do 15 vehicles at time. 20th February 2002
Peak District National Park Authority, Aldem House, Baslow Road, Bakewell, Derbyshire, DE45 1AE.
Dear Sirs,
Proposed Conversion of Existing Buildings to Two Holiday Cottages, Cressbrook Hall, Cressbrook.
As discussed recently with Kevin Wheeldon and John Scott, I enclose the following to enable you to process a full planning application re the above:-
1. 4 sets of planning application form and Certificate 'A'.
2. 4 copies of drawings 1229/02 & 03.
3. Cheque in the sum of £380.00 made payable to the Peak District National Park Authority.
The site is enclosed by a high brick wall and originally served as the vegetable garden and orchards to Cressbrook Hall. The buildings were used as estate workers accommodation, tool sheds and water storage tanks. In the early 1960's the gardens were turned into an intensive pig farming operation which included the construction of approximately 200 individual pig pens in the gardens. This venture was abandoned several years later and the site fell into disrepair.
In the early 1980's the present owners acquired Cressbrook Hall with its grounds and sought to refurbish and restore the gardens. Approval was granted in 1988 for the re-use of the limestone part of the existing buildings as a horticultural workers dwelling. The Greenhouse was to continue to be used for horticultural purposes. This venture also was not entirely successful, though considerable reclamation and improvement works were made to the gardens.
This proposal is to convert and restore the original buildings for use as two holiday units, to operate in conjunction with the existing business of Cressbrook Hall.
Few external alterations, other than refurbishment, are necessary to the limestone building. The existing greenhouse is poorly constructed and, as is readily apparent on site, is smaller than the original construction. The proposed Conservatory matches the profile of the original building and uses materials considerably more sympathetic to the traditional character of the area.
The reclamation works to the gardens would continue and the enclosing walls, repaired as necessary.
The scheme therefore reinstates the original construction and would provide an ongoing use for this significant part of Cressbrook Hall's heritage.
Please do not hesitate to contact me to discuss any aspect of the enclosed, if you have any queries over any detail.
Yours faithfully,
David Sutherland
David Sutherland BSc(hons) BArch(hons) RIBA Town and Country Planning (General Development Procedure) Order 1995 Certificate under Article 7 Certificate A
I certify that:
on the day 21 days before the date of the accompanying application nobody, except the applicant, was the owner (a) of any part of the land to which the application relates.
THIS MUST BE COMPLETED IN EVERY CASE Agricultural Holdings Certificate Instructions
One of the following alternative paragraphs must form part of this certificate. If the site is not part of an agricultural holding cross out the second paragraph. If the applicant is the sole agricultural tenant he or she must delete the first paragraph and insert 'not applicable' as the information required by the second.
- None of the land to which the application relates is, or is part of, an agricultural holding.
or,
- I have/ The applicant has given the requisite notice to every person other than myself/ her/ himself who, on the day 21 days before the date of the application, was a tenant of an agricultural holding on all or on part of the land to which the application relates, as follows:-
Tenant's name
Address at which notice was served
Date on which notice was served
Signed: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
- On behalf of: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Date: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
- Delete where inappropriate APPLICATION FOR PLANNING PERMISSION TO DEVELOP LAND ETC. Town and Country Planning Act 1990
Please read the attached notes before you fill in any part of this form.
Please send four completed copies of this form and four copies of the plans to the Peak District National Park Authority. Aldern House, Baslow Road, Bakewell, Derbyshire, DE45 1AE.
PART I
1 Applicant (BLOCK CAPITALS PLEASE)
| Name | MR & MRS L HULL-BAILEY | |------|-------------------------| | Address | CRESSBROOK HALL | | Address | CRESSBROOK, Nr Buxton | | Address | DERBYSHIRE | | Postcode | DE45 1AE | | Tel. No. | |
Agent (if any) to whom correspondence should be sent (BLOCK CAPITALS PLEASE)
| Name | DAVID SUTHERLAND ARMS | |------|-------------------------| | Address | LITTON MILL | | Address | LITTON MILL, Nr. Buxton | | Address | DERBYSHIRE | | Postcode | SK17 8SR | | Tel. No. | 871100 |
2 Proposals for which permission is sought:
a. Full address or location of the land to which this application relates and site area (hectares or acres)
b. Brief particulars of proposed development including the purpose(s) for which the land and/or buildings are to be used
CONVERSION OF EXISTING BUILDING TO TWO HOLIDAY UNITS
YES - SEE PLAN
c. State whether applicant owns or controls any adjoining land, if yes give its location and edge in blue on submitted plans
d. State whether the proposal involves
i. New building(s)
ii. Retention of existing building(s)
iii. Alteration or extension
iv. Change of use
v. Construction of a new access to a highway
vi. Alteration of an existing access to a highway
vii. Removal or variation of a condition
viii. Mineral working
ix. Waste disposal
x. Other operations
continued over page..... 5 Additional Information
a. Materials: Existing - Roof: POLYCARBONATE SHEET Wall: LIMESTONE & GLASS Proposed - Roof: GLASS Wall: LIMESTONE & GLASS
b. Is the application for industrial, office, warehouse, storage or shopping purposes? [ ]
c. Does the proposed development involve the felling of any trees? [ ]
d. I. How will surface water be disposed of? e.g. mains, soakaway, etc., is this system existing or proposed? II. How will foul sewage be dealt with? e.g. mains, septic tank, etc., is this system existing or proposed?
SOAKAWAYS - PROPOSED ENT. SEPTIC TANK
f. Are there any public rights of way crossing the site? [ ]
g. Are there any buildings to be demolished? [ ]
Fee State the amount of fee submitted with the application £800.
6 I/We apply for: (Tick appropriate box)
☐ a. Planning permission to carry out the development described in this application and the attached plans, and in accordance therewith.
☐ b. Planning permission to retain buildings or works already constructed or carried out, or a use of land already instituted as described on this application and the attached plans.
☐ c. Approval of details of such matters as were reserved in the outline permission specified herein and are described in this application and the attached plans.
I/We understand that this is an application for planning permission only and not for any other form of application which may be required.
Date: 19-2-02
Signed: [Signature]
(insert applicant's name if signed by an agent)
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b2d1cde38eba27a86a0e151de11e8aaebd9eaa65 | | Date Paid | Expense Type | Supplier | Expense Area | Transaction Reference | Amount | |-----------|--------------|----------|--------------|-----------------------|--------| | 06/09/2012 | BIOCHEMISTRY TRUSTWIDE | ABBOTT LABORATORIES LTD | LABORATORY REAGENTS | 572364 | 33887.85 | | 06/09/2012 | BIOCHEMISTRY TRUSTWIDE | ABBOTT LABORATORIES LTD | POSTAGE & CARRIAGE | 572364 | 53.47 | | 13/09/2012 | EXT CONTROL NHS FOUNDATION TRUST | ABBOTT LABORATORIES LTD | ALLIANCE HEALTHCARE (DISTRIBUTION) LTD | 598271 | 28853.98 | | 18/09/2012 | BALANCE SHEET | ALLIANCE HEALTHCARE (DISTRIBUTION) LTD | ALLIANCE HEALTHCARE (DISTRIBUTION) LTD | 602719 | 38662 | | 20/09/2012 | BALANCE SHEET | BIO PRODUCTS LABORATORY | BIO PRODUCTS LABORATORY | 24187 | 3000 | | 20/09/2012 | BALANCE SHEET | CELGENE | CELGENE | 602706 | 31449.6 | | 20/09/2012 | BALANCE SHEET | CELGENE | CELGENE | 602711 | -31449.6 | | 28/09/2012 | PFI ACCOUNTING | CONSORT HEALTHCARE (MD YORKSHIRE), LTD | CONSORT HEALTHCARE (MD YORKSHIRE), LTD | 600762 | 3294790.09 | | 25/09/2012 | PGH UTILITIES & RATES | CORONA ENERGY RETAIL 4 LTD | CORONA ENERGY RETAIL 4 LTD | 602297 | 26076.49 | | 06/09/2012 | BALANCE SHEET | DUNWOODIE ARCHITECTURE AND DESIGN | DUNWOODIE ARCHITECTURE AND DESIGN | 593469 | 26434.4 | | 20/09/2012 | PGH UTILITIES & RATES | EDF ENERGY LTD | EDF ENERGY LTD | 600751 | 33106.56 | | 20/09/2012 | PGH UTILITIES & RATES | EDF ENERGY LTD | EDF ENERGY LTD | 600752 | 77320.15 | | 20/09/2012 | PGH UTILITIES & RATES | EDF ENERGY LTD | EDF ENERGY LTD | 600753 | 76418.7 | | 20/09/2012 | ESTATE MANAGEMENT DDN | EDF ENERGY LTD | EDF ENERGY LTD | 600756 | 59939.28 | | 13/09/2012 | BALANCE SHEET | ELI LILLY & CO LTD | ELI LILLY & CO LTD | 595894 | 34560 | | 20/09/2012 | BALANCE SHEET | HEALTHCARE PRODUCT SERVICES-INV 939,945,971 | HEALTHCARE PRODUCT SERVICES-INV 939,945,971 | 599539 | 27120 | | 03/09/2012 | ORTHOPAEDIC DEPARTMENT - PONTE | HUGH STEEPER LTD | HUGH STEEPER LTD | 593207 | 70357.26 | | 03/09/2012 | ORTHOPAEDIC DEPARTMENT - PONTE | PATIENTS APPLIANCES : PURCHASE | PATIENTS APPLIANCES : PURCHASE | 593207 | 5847.76 | | 18/09/2012 | INFORMATION TECHNOLOGY | SOFT LIMITED | SOFT LIMITED | 595857 | 13000 | | 06/09/2012 | GRAPHIC DESIGN | KONICA MINOLTA BUSINESS SOLUTIONS EAST LTD | KONICA MINOLTA BUSINESS SOLUTIONS EAST LTD | 598846 | 39259.44 | | 03/09/2012 | GENERAL SURGERY - TRUSTWIDE | LEEDS TEACHING HOSPITALS NHS TRUST | LEEDS TEACHING HOSPITALS NHS TRUST | 592192 | 80000 | | 13/09/2012 | BALANCE SHEET | LEX AUTOLEASE LTD | LEX AUTOLEASE LTD | 597032 | 12967.72 | | 13/09/2012 | REG SPINAL INJURIES CENTRE PGH | MEDTRONIC LTD | MEDTRONIC LTD | 594135 | 28260 | | 13/09/2012 | BLOOD SERVICE TRUSTWIDE | NHS BLOOD AND TRANSPLANT | NHS BLOOD AND TRANSPLANT | 24063 | 417767.23 | | 13/09/2012 | BLOOD SERVICE TRUSTWIDE | NHS BLOOD AND TRANSPLANT | NHS BLOOD AND TRANSPLANT | 24065 | 115401.15 | | 13/09/2012 | BLOOD SERVICE TRUSTWIDE | NHS BLOOD AND TRANSPLANT | NHS BLOOD AND TRANSPLANT | 24066 | 94799.99 | | 17/09/2012 | MYHT LOSSES AND COMPS | NHS LITIGATION AUTHORITY | NHS LITIGATION AUTHORITY | 24365 | 26367 | | 06/09/2012 | NSHP HOLDING ACCOUNT | NHS PROFESSIONALS | NHS PROFESSIONALS | 594185 | 57862.6 | | 13/09/2012 | NSHP HOLDING ACCOUNT | NHS PROFESSIONALS | NHS PROFESSIONALS | 594185 | 17502.81 | | 13/09/2012 | NSHP HOLDING ACCOUNT | NHS PROFESSIONALS | NHS PROFESSIONALS | 594185 | 60792.33 | | 13/09/2012 | NSHP HOLDING ACCOUNT | NHS PROFESSIONALS | NHS PROFESSIONALS | 594185 | 16343.56 | | 20/09/2012 | NSHP HOLDING ACCOUNT | NHS PROFESSIONALS | NHS PROFESSIONALS | 597223 | 60372.02 | | 20/09/2012 | NSHP HOLDING ACCOUNT | NHS PROFESSIONALS | NHS PROFESSIONALS | 597223 | 15375.52 | | 06/09/2012 | NSHP HOLDING ACCOUNT | NHS SUPPLY CHAIN | NHS SUPPLY CHAIN | 23984 | 92062.25 | | 06/09/2012 | NSHP HOLDING ACCOUNT | NHS SUPPLY CHAIN | NHS SUPPLY CHAIN | 23985 | 70168.11 | | 13/09/2012 | NSHP HOLDING ACCOUNT | NHS SUPPLY CHAIN | NHS SUPPLY CHAIN | 24098 | 168771.46 | | 13/09/2012 | NSHP HOLDING ACCOUNT | NHS SUPPLY CHAIN | NHS SUPPLY CHAIN | 24099 | 68683.64 | | 20/09/2012 | NSHP HOLDING ACCOUNT | NHS SUPPLY CHAIN | NHS SUPPLY CHAIN | 24157 | 171387.3 | | 20/09/2012 | NSHP HOLDING ACCOUNT | NHS SUPPLY CHAIN | NHS SUPPLY CHAIN | 24157 | 76849.3 | | 20/09/2012 | NSHP HOLDING ACCOUNT | NHS SUPPLY CHAIN | NHS SUPPLY CHAIN | 24241 | 66703.38 | | 28/09/2012 | NSHP HOLDING ACCOUNT | NHS SUPPLY CHAIN | NHS SUPPLY CHAIN | 24242 | 101395.3 | | 06/09/2012 | NSHP HOLDING ACCOUNT | NOVARTIS PHARMACEUTICALS UK LTD | NOVARTIS PHARMACEUTICALS UK LTD | 598971 | 42668.32 | | 25/09/2012 | BALANCE SHEET | NOVARTIS PHARMACEUTICALS UK LTD | NOVARTIS PHARMACEUTICALS UK LTD | 599600 | 125307.5 | | 18/09/2012 | BIOCHEMISTRY TRUSTWIDE | QBE INSURANCE (EUROPE) LTD | QBE INSURANCE (EUROPE) LTD | 573077 | 354000.0 | | 06/09/2012 | BALANCE SHEET | ROCHE PRODUCTS LTD | ROCHE PRODUCTS LTD | 596561 | 104774.7 | | 13/09/2012 | BALANCE SHEET | ROCHE PRODUCTS LTD | ROCHE PRODUCTS LTD | 596562 | 6447.76 | | 13/09/2012 | BALANCE SHEET | SMITH & NEPHEW ADVANCED SURGICAL DEVICES | SMITH & NEPHEW ADVANCED SURGICAL DEVICES | 595326 | 35662.87 | | 20/09/2012 | WDCS MDT TEAM | SOUTH WEST YORKSHIRE PARTNERSHIP NHS TRUST | SOUTH WEST YORKSHIRE PARTNERSHIP NHS TRUST | 22574 | 25641.88 | | 06/09/2012 | PGH UTILITIES & RATES | WAKEFIELD METROPOLITAN DISTRICT COUNCIL | WAKEFIELD METROPOLITAN DISTRICT COUNCIL | 592771 | 237651 | | 06/09/2012 | PGH UTILITIES & RATES | WAKEFIELD METROPOLITAN DISTRICT COUNCIL | WAKEFIELD METROPOLITAN DISTRICT COUNCIL | 592771 | 58052 | | 24/09/2012 | BALANCE SHEET | PAYROLL DEGN S N\<1 YR | PAYROLL DEGN S N\<1 YR | 21806 | 53463.22 |
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384ebe2c8085215f280b521a4d860826ba1cb961 | Applefields School City of York Council Internal Audit Report 2015/16
Business Unit: Special Schools, Headteacher: A Booker Date Issued: 10/12/15 Status: Final Reference: 15666/005
| Actions | P1 | P2 | P3 | |---------|----|----|----| | Overall Audit Opinion | Substantial Assurance | Introduction This audit was carried out on Thursday 14th May and Thursday 15th May 2015 as part of the Internal Audit plan for Education, Skills and Children’s Services for 2015/16.
Objectives and Scope of the Audit The purpose of this audit was to provide advice to the Governors, Head Teacher and the Authority's Section 151 Officer about the financial management procedures and assurance that internal controls of the school were operating effectively to manage key risks, both financial and otherwise.
The audit covered the following areas in accordance with the specification issued on 27th January 2015:
- Governance;
- Financial Management;
- System Reconciliation;
- Petty Cash
- Contracts – Ordering, Purchasing and Authorisation;
- Income;
- Capital and Property;
- Additional School Activity Provision;
- Human Resources;
- Payroll;
- School Meals;
- Pupil Numbers;
- Voluntary Funds Monitoring Arrangements;
- Data Protection and Information Technology;
- Insurance and Risk Management;
- Joint Use Facilities;
- Inventory Records;
- Minibus.
- Security; and
- Safeguarding Arrangements. Key Findings The key findings in the audit related to maintenance of a staff register of interests, completion of a tender opening record, confirmation of the correct application of VAT exemption for sports lettings, ensuring contractors and private users of the school have adequate public liability insurance cover, completion of pre-employment checks, recording return to work interviews, registration of the school fund with the Charity Commission and adoption of a model publication scheme.
Overall Conclusions It was found that the arrangements for managing risk were good with few weaknesses identified. An effective control environment is in operation, but there is scope for further improvement in the areas identified. Our overall opinion of the controls within the system at the time of the audit was that they provided Substantial Assurance
## 1 Register of Interests
| Issue/Control Weakness | Risk | |---------------------------------------------------------------------------------------|----------------------------------------------------------------------| | The school did not maintain a register of interests for staff with financial responsibilities and who could potentially influence purchasing decisions. | The school may be unable to fully account for purchasing decisions in the event of challenge. |
### Findings
It was noted that a staff register of interests was not maintained at the school as required by the CYC Scheme for Financing Schools. Staff with financial responsibilities may be in a position to influence the placing of contracts in which they have a personal interest and must therefore ensure that all significant interests are declared.
### Recommendation
A register of business interests for staff with financial responsibilities should be set up and reviewed on an annual basis. The register should be promptly updated to include any new staff and should include “nil” returns.
### Agreed Action 1.1
The register of business interests for staff with financial responsibilities will be set up by 30th October 2015. In future it will be updated to include any new staff and will include “nil” returns.
| Priority | Responsible Officer | Timescale | |----------|---------------------|-----------------| | 3 | Headteacher | 30th October 2015 |
## 2 Contract Procedures
| Issue/Control Weakness | Risk | |---------------------------------------------------------------------------------------|----------------------------------------------------------------------| | The school did not complete a tender opening record for the cleaning contract procurement. | The school's procedures for the procurement may be open to challenge. |
### Findings
The cleaning contract procurement was reviewed to ensure compliance with the Council’s Financial Regulations and Contract Rules. It was noted that there had been no tender opening record completed to record the date and time of tender opening, the officers present and the returned tender values.
### Recommendation
A tender opening record should be completed for all tendered contracts. A pro-forma record has been sent to the school.
### Agreed Action 2.1
Tender opening records will be completed for all tendered contracts in the future using the pro-forma record supplied.
| Priority | Responsible Officer | Timescale | |----------|---------------------|-----------| | 3 | Headteacher | Immediate | 3 Contract Review Schedule
| Issue/Control Weakness | Risk | |---------------------------------------------------------------------------------------|----------------------------------------------------------------------| | There was no evidence that all service contracts at the school are periodically reviewed. | The school may fail to obtain best value on school service contracts. |
Findings
Although contract documentation is available for individual service contracts at the school, a central record of all service contracts at the school was not in place. Services to schools are discussed annually and the review of individual contracts recorded in Governor Minutes. However, there was no evidence to confirm that all continuing contractual arrangements are periodically reviewed to ensure they meet current requirements, have been correctly costed (for budget purposes) and are programmed for re-tender where applicable.
Recommendation
It is recommended that a central schedule of current contracts is maintained and contract review at the school is evidenced through review of this record. A pro-forma record has been sent to the school.
Agreed Action 3.1
A central record of all service contracts at the school has been prepared by the Site Manager and Office Manager in order to ensure that continuing contractual arrangements are reviewed periodically to ensure they meet current requirements and are programmed for re-tender where applicable. The Bursar will use this record to ensure that contractual arrangements are correctly costed in the budget.
| Priority | Responsible Officer | Timescale | |----------|---------------------|--------------------| | 3 | Site Manager/Office Manager and Bursar | 30th October 2015 | 4 Insurance
| Issue/Control Weakness | Risk | |------------------------|------| | The school does not adequately ensure that all private users of the school (under lettings) and contractors directly commissioned to complete works at the school have current and adequate public liability insurance cover. | Costs may be incurred by the school in the event of a claim. |
Findings
A number of minor works (e.g., electrical works and window cleaning) were completed by contractors directly commissioned by the school. Although the adequacy of the contractors public liability insurance cover held by these contractors may have been initially verified, there was no current insurance certificate held on file to confirm continuing compliance with CYC insurance requirements. This was also the case for longer term contracts at the school (such as ground maintenance).
It was also noted that not all groups using the school under letting arrangements had a current public liability insurance certificate on file. For one group only evidence of employers liability cover had been obtained and for a second group the level of public liability insurance was £3m and not the £5m cover generally required.
Recommendation
For all users of the school under lettings agreements and for contractors directly commissioned to carry out works at the school, a current copy of the contractor’s public liability insurance certificate, evidencing cover of at least £5m should be requested and retained. If a contractor is used or a letting continues on a regular basis, a system should be in place to ensure that an up to date copy of the insurance certificate is obtained when the expiry date has been reached.
Agreed Action 4.1
The Office Manager has written to all those currently letting the school premises and hydrotherapy pool and has seen up to date public liability insurance certificates evidencing cover of at least £5m. The Site Manager has also written to contractors used on a regular basis and has now seen the same information. This information will also be requested for any contractors new to the school or any new lessees.
| Priority | Responsible Officer | Timescale | |----------|---------------------|-----------| | 3 | Site Manager and Office Manager | 30th October 2015 | 5 VAT
| Issue/Control Weakness | Risk | |------------------------|------| | VAT on lettings income received by the school may not be correctly charged or accounted for. | HM Revenue & Customs may penalise the school for failing to account for VAT correctly. |
Findings
The Hydrotherapy Pool was being used by several organisations under lettings agreements with the school. No VAT was charged on the invoices raised. However, it was not clear whether these lettings met all the 7 requirements for VAT exemption in particular it was not clear whether all these groups could be categorised an affiliated club, school, association or an organisation representing an affiliated club.
Recommendation
Lettings at the school should be reviewed to ensure that invoiced charges include VAT where the letting does not meet all the VAT exemption requirements. It is suggested that the lettee is required to confirm that all the requirements are met.
Agreed Action 5.1
All lettings at the school have been reviewed to ensure that invoiced charges include VAT where applicable. Lessees were asked to complete a form to confirm that they meet all the VAT exemption requirements at the start of the autumn term 2015. Invoices for those not meeting the requirement have been charged VAT with effect from 1st September. The school will calculate any VAT due on such lettings for previous periods and will liaise with the CYC Schools Business Support Team and VAT Officer regarding any VAT correction that is required for previous years.
| Priority | Responsible Officer | Timescale | |----------|---------------------|-----------| | 3 | Office Manager and Bursar | 30th October 2015 |
### 6 Pre Employment Checks
| Issue/Control Weakness | Risk | |------------------------|------| | Insufficient evidence may be held on file to confirm that all pre-employment checks have been completed. | Unsuitable staff may be employed at the school and the school may be unable to demonstrate compliance with section 8 of the Asylum and Immigration Act 1996 which may result in fines of up to £10,000. |
#### Findings
Personal files for a small sample of new staff were reviewed. It was found that in one case documents used to confirm the right to work in the UK had not been copied and retained on file. For a second member of staff there was no evidence that relevant qualifications had been verified.
#### Recommendation
Evidence used to confirm the right to work in the UK should be in accordance with Border Agency Guidance and copies of documents used retained on file. Checks to confirm relevant qualifications are held should also be adequately evidenced and it is recommended that copies of certificates are held on file.
#### Agreed Action 6.1
The Office Manager will ensure that, in future, evidence used to confirm the right to work in the UK is in accordance with Border Agency Guidance and that copies of documents used as evidence are retained on file. She will also ensure that evidence of relevant qualifications has been verified and copies of certificates will be retained on file.
| Priority | Responsible Officer | Timescale | |----------|---------------------|-----------| | 3 | Office Manager | 1st September 2015 |
### 7 Sickness Records
| Issue/Control Weakness | Risk | |------------------------|------| | Return to work interviews after a period of sickness were not being completed and recorded on the Council’s Self Certification Form. | Failure to comply with HR policy and procedures. |
#### Findings
Self Certification Forms completed for a small sample of staff sickness absences were reviewed and it was noted that a return to work interview had not been recorded.
#### Recommendation
Every period of absence should be followed up by a return to work interview with the line manager/supervisor, usually on the first day of the employee’s return to work. This should be completed in accordance with HR Guidelines and recorded on the City of York Council Self Certification Form.
#### Agreed Action 7.1
With effect from 1st September the Headteacher has ensured that every period of absence is followed up by a return to work interview within three days of the employee’s return to work. This is being completed in accordance with HR Guidelines and recorded on the City of York Council Self Certification Form.
| Priority | Responsible Officer | Timescale | |----------|---------------------|-----------| | 3 | Headteacher | 1st September 2015 | 8 School Fund
| Issue/Control Weakness | Risk | |------------------------|------| | The Charity Commission had removed the school fund from the Charity Commission Register. | The school fund is not a registered charity and is operating without a formal governing document and the control of Trustees. |
Findings
Charity Commission Registration had been withdrawn after failure to submit annual returns by the due date. It was understood that the school was in the process of applying for a new registration. Additionally, although accounts to 31/3/15 had been independently audited the annual audited accounts had not been presented to Governors.
Recommendation
The school should continue to progress registration of the school fund with the Charity Commission. It is suggested that the number of trustees of the school fund include, at minimum, the current members of the Finance Committee. The Trustees/Governors should be presented with the independently examined accounts and annual report at the end of every financial year and have the opportunity to discuss the items of income and expenditure and uses of the fund.
Agreed Action 8.1
The application to apply for a new registration for the School Fund has been submitted to the Charity Commission. Trustees of the School Fund have been appointed and will include members of the school’s Resources Committee of the Governing Body. The accounts for the School Fund were presented to the Staffing and Resources Committee at its meeting on 30th September 2015.
| Priority | Responsible Officer | Timescale | |----------|---------------------|-----------| | 3 | Office Manager and Bursar | 30th November 2015 |
## 9 Publication Scheme
| Issue/Control Weakness | Risk | |---------------------------------------------------------------------------------------|----------------------------------------------------------------------| | The school had not adopted the Information Commissioners Model Publication Scheme for Schools and associated Guide to Information. | The school may not be complying fully with the requirements under the Data Protection Act (DPA), Environmental Regulations (EIR) and Freedom of Information Act (FOIA) and statutory requirements may be breached. |
### Findings
Schools are required by the Data Commissioner to adopt the Model Publication Scheme for School. There was no evidence at the school that this had been done.
### Recommendation
The Information Commissioners Model Publication Scheme should be adopted by the school and approved by the Full Governing Body. This can be obtained from the ICO website and must be adopted in full, unedited and promoted alongside the Guide to Information. The approved Publication Scheme should be made available to parents eg published on the schools website.
### Agreed Action 9.1
The school will adopt the Information Commissioners’ Model Publication Scheme. This will be presented to the Governing Body for adoption at a meeting during the Autumn term. The approved Publication Scheme will be made available to parents by publication on the school’s website.
| Priority | Responsible Officer | Timescale | |----------|---------------------|--------------------| | 3 | Headteacher and Office Manager | 18th December 2015 |
## 10 Minibus
| Issue/Control Weakness | Risk | |------------------------|------| | Pre-drive checks were not recorded. | Failure to comply with the Councils Health & Safety requirements for the minibus (CN30) |
### Findings
The minibus was checked on a weekly basis and a record of checks maintained. Minibus drivers are also required to complete basic pre-drive checks before driving the minibus. These checks were not being recorded.
### Recommendation
Drivers should be reminded of their responsibilities to complete pre-use checks and completion should be evidenced in either the mileage log book or other suitable record.
### Agreed Action 10.1
The Site manager has reminded drivers of their responsibility to complete pre-drive checks before driving the minibus. This is now being recorded on the minibus daily seating plan.
| Priority | Responsible Officer | Timescale | |----------|---------------------|-----------| | 3 | Site Manager | 30th October 2015 | | Issue/Control Weakness | Risk | |------------------------|------| | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | | xxxxxxxxxxxxxxxxxxxxxx | xxxxxxxxxxxxxxxxxxxxxx |
**Findings**
| xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx |
**Recommendation**
| xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx |
**Agreed Action 11.1**
| xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | xxxxxxxxxxxxxxxxxxxxxx | | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | xxxxxxxxxxxxxxxxxxxxxx | | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | xxxxxxxxxxxxxxxxxxxxxx | | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | xxxxxxxxxxxxxxxxxxxxxx | | xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxx | xxxxxxxxxxxxxxxxxxxxxx |
| Priority | xxxxxxxxxxxxxxxxxxxxxx | | Responsible Officer | xxxxxxxxxxxxxxxxxxxxxx | | Timescale | xxxxxxxxxxxxxxxxxxxxxx | Audit Opinions and Priorities for Actions
Audit Opinions
Audit work is based on sampling transactions to test the operation of systems. It cannot guarantee the elimination of fraud or error. Our opinion is based on the risks we identify at the time of the audit.
Our overall audit opinion is based on 5 grades of opinion, as set out below.
| Opinion | Assessment of internal control | |--------------------|------------------------------------------------------------------------------------------------| | High Assurance | Overall, very good management of risk. An effective control environment appears to be in operation. | | Substantial Assurance | Overall, good management of risk with few weaknesses identified. An effective control environment is in operation but there is scope for further improvement in the areas identified. | | Reasonable Assurance | Overall, satisfactory management of risk with a number of weaknesses identified. An acceptable control environment is in operation but there are a number of improvements that could be made. | | Limited Assurance | Overall, poor management of risk with significant control weaknesses in key areas and major improvements required before an effective control environment will be in operation. | | No Assurance | Overall, there is a fundamental failure in control and risks are not being effectively managed. A number of key areas require substantial improvement to protect the system from error and abuse. |
Priorities for Actions
| Priority | Description | |----------|-----------------------------------------------------------------------------| | Priority 1 | A fundamental system weakness, which presents unacceptable risk to the system objectives and requires urgent attention by management. | | Priority 2 | A significant system weakness, whose impact or frequency presents risks to the system objectives, which needs to be addressed by management. | | Priority 3 | The system objectives are not exposed to significant risk, but the issue merits attention by management. | Where information resulting from audit work is made public or is provided to a third party by the client or by Veritau then this must be done on the understanding that any third party will rely on the information at its own risk. Veritau will not owe a duty of care or assume any responsibility towards anyone other than the client in relation to the information supplied. Equally, no third party may assert any rights or bring any claims against Veritau in connection with the information. Where information is provided to a named third party, the third party will keep the information confidential.
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2d5dfface84f97d2f6de314fa46da5d7152a76c3 | | Public Protection Committee | Item No. | |-----------------------------|---------| | 14 October 2003 | |
| Report of Borough Solicitor | Title of Report | |-----------------------------|-----------------| | Directorate: | Application for the renewal of a Sex Establishment Licence The Adult Shop 178 Wellingborough Road Northampton | | Chief Executive and Town Clerk | | | Author/Contact Officer: | | | Mrs Dee Knapp Solicitor Borough Solicitors Legal Section 01604 837837 ext 7336 | | | Mr P Bayliss Licensing Enforcement Officer Tel: 01604 837837 ext 7099 | |
| Recommendations | |-----------------| | That the application be considered. |
**The Application** Application has been made by Mr Liam McCann of 140 Ashington Grove Coventry West Midlands.
For the renewal of this Licence.
The application fee of £1000.00 has been paid.
A report is awaited from the Police.
Notices of this application have been published in a local newspaper. Background
1. The Law
Where a district Council has adopted Schedule 3 of the Local Government (Miscellaneous Provisions) Act 1982, (which Northampton Borough Council has), then any person wishing to use premises as a “sex establishment”, requires a licence to do so.
The Act specifies the form of any application and that notice of the application for a grant, renewal or transfer must be given in the local press and publicly displayed for 21 days. Any person may object to the application in writing to the local authority within 28 days of the application. The local authority is required to inform the applicant in general terms of the grounds of the objections.
The local authority is also required to have regard to the observations of the police.
The Act provides that an applicant shall be given the opportunity of presenting his application before the committee when the matter is determined. If objectors attend, and wish to speak, whether they are allowed to do so is entirely in the Committee’s discretion. Members must bear in mind however that if any objectors raise any matters not disclosed by their objection, the applicant may be entitled to have the hearing adjourned to consider the points raised.
It must be emphasised that the local authority’s duty is to carefully consider an application on its merits.
There are various grounds on which an application must be refused. To précis;
(a) That the application is unsuitable to hold a licence by reason of having been convicted of an offence or for any other reason.
(b) That if the licence were granted the business would be managed by or carried on for the benefit of a person other than the applicant, who would be refused the grant if he himself applied.
(c) That the number of sex establishments in the relevant locality at the time the application is made is equal to or exceeds the number which the authority consider is appropriate.
(d) That the grant of the licence would be inappropriate having regard to the character of the relevant locality, the use to which any premises in the vicinity are put or to the layout character or condition of the premises.
If the Committee is not reasonably satisfied that one or more of the above criteria are relevant to the application, its duty is to grant the licence. The legal requirement is that Members should, as far as possible, take into account only information available to them which is relevant in deciding whether or not the above criteria apply to each particular application and ignore any religious, moral or social viewpoints they may hold about sex shops generally.
2. **Suitability of Applicant and Location of Premises** The Local Government (Miscellaneous Provisions) Act 1982 enables the Council to control the suitability of an individual applicant, the location of the premises and the number of premises in a defined locality, the appearance of the shop and the shop front, the level of fee and the hours of opening.
A licensing authority can adopt reasonable policy guidelines to help it determine applications for sex shop licences, in particular that it would be inappropriate to site sex shops in certain specified historically important streets or near schools, shopping complexes or in residential areas.
Councillors can to some extent use their own subjective local knowledge in deciding which factors are relevant in the character of the locality.
3. **Planning Implications** In planning terms the definition of a shop is an establishment for sales or services to visiting members of the public. With the exception of motor vehicles, types of goods for sale are not a planning consideration.
As with all shops the display of their advertisements can only be controlled if they are above a particular size or height or are illuminated.
Shop window displays are not normally controlled and no provision exists to control the goods for sale on these premises. Generally speaking, an advertisement requiring consent would be viewed in terms of its style and design, giving regard to the building and the street scene rather than its particular wording or content.
4. **The Council’s Present Policy on the Number of Licensed Sex Establishments in the Borough of Northampton** On 28 May 1998 the Licensing Committee resolved that the appropriate number of sex establishments in the relevant locality known as the Wellingborough Road (being the area bounded by and including Wellingborough Road, Kettering Road and Abington Avenue) is three.
On 17 December 1998 the Licensing Committee resolved that the appropriate number of sex establishments within the locality known as Northampton town centre (being the area bounded by and including Victoria Promenade, Cheyne Walk, York Road, Lower Mounts, Lady’s Lane, Mayorhold, Horsemarket, Horseshoe Street, Gas Street and St Peters Way) was nil.
The Council presently has no policy on the number of sex establishments to be licensed in the whole borough of Northampton. The Act was designed to allow local authorities to have a certain degree of control over such premises whilst at the same time allowing the general public scope to comment. There have been no complaints of any time received during the last twelve months.
**Author and Contact Officer**
Mrs Dee Knapp, Borough Solicitor, Legal Section Tel 01604 837837 x 7336\
Mr P Bayliss, Licensing Enforcement Officer Tel 01604 837837 x 7099
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7d0eee269490cc7894513906df1ce8fb3667efee | Application for a Lawful Development Certificate for an Existing Use or Operation or Activity including breach of a Planning Condition
Validation Checklist
What information do I submit with my application? National Requirements
Forms
- Completed form (3 copies to be supplied unless the application is submitted electronically)
Plans
- The National requirements are for ‘a plan which identifies the land to which the application relates’. This shall be met by providing a plan based on an up-to-date map at an identified metric scale. For built up areas and within villages the location plan shall be at a scale of 1:1250 (or 1:2500 in the case of larger or more remote sites) and indicate the direction of North. Wherever possible the plan shall be scaled to fit onto A4 or A3 size paper. The location plan will clearly identify the land to which the application relates within a red line and within a blue line for any other land owned by the applicant located adjacent to the application site. Three copies need to be supplied unless the application is submitted electronically.
Other Information
- Suitable evidence verifying the information included in the application as can be provided
- Suitable information as is considered to be relevant to the application
- The appropriate fee
Contact us Property Information Team Development Control Town Hall Duke Street Barrow-in-Furness LA14 2LD
Email: [email protected]
1 The national guidelines are subject to change at short notice but we will endeavour to update these at the earliest opportunity.
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9baf9e2e57dda13affcca5266c9d19a37624d444 | Application for a Lawful Development Certificate for a Proposed Use or Development Validation Checklist
What information do I submit with my application? National Requirements
Forms
- Completed form (3 copies to be supplied unless the application is submitted electronically)
Plans
- The National requirements are for ‘a plan which identifies the land to which the application relates’. This shall be met by providing a plan based on an up-to-date map at an identified metric scale. For built up areas and within villages the location plan shall be at a scale of 1:1250 (or 1:2500 in the case of larger or more remote sites) and indicate the direction of North. Wherever possible the plan shall be scaled to fit onto A4 or A3 size paper. The location plan will clearly identify the land to which the application relates within a red line and within a blue line for any other land owned by the applicant located adjacent to the application site. Three copies need to be supplied unless the application is submitted electronically.
Other Information
- Suitable evidence verifying the information included in the application as can be provided
- Suitable information as is considered to be relevant to the application
- The appropriate fee
Contact us Property Information Team Development Control Town Hall Duke Street Barrow-in-Furness LA14 2LD
Email: [email protected]
1 The national guidelines are subject to change at short notice but we will endeavour to update these at the earliest opportunity.
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8d3274609fdec722483813750e8e805cba68682f | The National Archives Independent Board Member – Audit and Risk Committee
Candidate briefing pack Contents
Role & Person Specification 3 Essential information 5 How to apply 6 Role and Person Specification
Audit and Risk Committee - Independent Member
Job Purpose
The Audit and Risk Committee is a crucial mechanism for supporting the National Archives Board ensuring that there are effective processes in place for governance, internal control and risk management.
As an Independent Member of the Audit and Risk Committee you will provide insight and strong constructive challenge regarding risks arising from increasing resource constraints, new service delivery models, information flows on risk and control, and the agility of the organisation to respond to emerging risks.
Role and Responsibilities
- Uphold the highest ethical standards of integrity and honesty, and be able to demonstrate an understanding of, and commitment to, the values and importance of the Seven Principles of Public Life.
- Build strong and collaborative relations with The National Archives to ensure you get the support and information you will need.
Advise the Board and Accounting Officer on:
- The strategic processes for risk, internal control and governance and the Governance Statement:
- The accounting policies, the annual report and accounts of the organisation, including the process for review of the accounts prior to submission for audit, levels of error identified, and management's letter of representation to the external auditors;
- The planned activity and results of both internal and external audit;
- Adequacy of management response to issues identified by audit activity, including external audit's management letter;
- Assurances relating to the management of risk and corporate governance requirements for the organisations;
- Proposals for tendering for either internal or External Audit services or for purchase of non-audit services from contractors who provide audit services;
- Anti-fraud policies, Whistle-Blowing processes, and arrangements for special investigations; and
- The Audit and Risk Assurance Committee’s periodic review of its own effectiveness and onward submission to the Board.
Person Specification:
Essential Criteria:
- Understanding of The National Archives vision and strategic priorities, its current significant issues and risks and the wider environment in which it operates.
- Understanding of The National Archive’s structure, including governance arrangements and key relationships in government, and with the wider archive sector.
- Appreciation of The National Archive’s culture.
- Good grasp of relevant legislation, including the Public Record Act, Freedom of Information, Data Protection. • Broad understanding of the government environment, particularly accounting structures and current major initiatives. • Demonstrable skills, knowledge and experience relevant to the work of the Audit and Risk committee including: accounting, risk management, internal/external audit, technical specialism pertinent to the work of The National Archives. • Experience of working with Audit and Risk committees in a large or complex delivery organisation in either the public or private sectors.
Desirable Criteria
• Membership of a recognised UK accounting institution and knowledge of Government accounting. Essential information
**Time commitment & terms of office** The time commitment will be approximately 4 days per annum (to include meetings and preparation time).
**Duration** The successful applicant will be offered a 3 year contract, with the possibility of extension for a further three years. Re-appointment is not automatic.
**Review of the individual** There will be an annual appraisal of the Non-Executive Board Members as part of the board effectiveness review.
**Remuneration** The Independent Board member will receive £400 per day for the typical time commitment, which includes preparation time.
**Conflicts of interest** All candidates will be asked to disclose any actual, potential or perceived conflict of interest, and these will be discussed with the candidate to establish whether and what action is needed to avoid a conflict or the perception of a conflict, taking account of advice received from the Cabinet Office Propriety and Ethics team as appropriate.
**Terms of Appointment** An offer of appointment will be made once all candidates have been interviewed, and will be subject to satisfactory completion of eligibility checks, including security. If you are offered an appointment you will receive a detailed summary of your main terms and conditions.
**Eligibility** To avoid possible disappointment at a later stage, we recommend that you check you are eligible before applying:
- **Nationality** - you must be a UK citizen, British protected person, a Commonwealth citizen, or a national of the European Economic Area (EEA), including nationals of the new member states.
**Equal Opportunities** National Archives is an equal opportunities employer, committed to equal opportunities policies. We welcome people from all backgrounds so that our workforce mirrors the community we serve. How to apply
If, after reading this information you decide to apply to join our Audit and Risk Committee, then please send the following:
- a full up-to-date CV,
- a covering letter on no more than two sides of A4 clearly setting out, in line with the person specification, what you can bring to the role.
The closing date for your completed application is **midnight on Sunday 13th September 2015**.
If you have any further questions then please contact Jane Craigie-Payne, Head of Human Resources & Organisational Development on 020 8392 5224.
Please apply by sending your CV and a covering letter detailing how you meet the criteria for this role to [email protected]
Should you require details of how to apply by post, please contact Jane Craigie-Payne, Head of Human Resources & Organisational Development on 020 8392 5224
Short listed candidates will be invited to attend an interview in late October 2015 in Central London or Kew, Surrey.
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74271ff5f75652bc9ca0d0e8cc18ac37285edaca | Applying for approval of a food establishment
How to apply for approval for meat, dairy, egg, fish, shellfish and animal produce establishments.
If your food business makes, prepares or handles meat, dairy, egg, fish, shellfish or animal produce for supply to other businesses, it may require approval by the local authority.
If you think you may need approval, please contact your local authority before applying.
When you don’t need to apply for approval
There are some exemptions from the requirement to be approved, including:
- you only sell direct to the public
- you are a retail business supplying products of animal origin to other businesses (including caterers) on a marginalised, localised and restricted basis
Additionally, there may be an exemption available depending on the extent to which you wish to supply food of animal origin to other businesses. You should contact your local authority to determine whether you could claim such an exemption from the need for approval.
If a food business is exempted from the requirement to be approved, you must register your food business with the local authority at least 28 days before opening. If you are already trading and have not registered, you need to do so as soon as possible.
You must still follow the rules for controlling the temperature and storage of any food you transport.
Establishments approved by local authorities
General establishments
These are:
- cold stores
- re-wrapping and re-packaging establishments
Meat establishments
These are:
- minced meat establishments
- meat preparations establishments
- mechanically separated meat establishments
- meat products processing plants
- rendered animal fats and greaves processing plants
- treated stomachs, bladders and intestines processing plants
- gelatine processing plants
- collagen processing plants
**Fish and shellfish establishments**
These are:
- live bivalve molluscs (LBMs) establishments including dispatch centres and purification centres
- establishments working with fishery products using factory and freezing vessels, processing plants, fresh fishery products, auction halls, wholesale markets
**Dairy establishments**
These are:
- collection centres of raw milk where it is cooled and filtered
- processing plants treating, processing and/or wrapping of dairy products (milk or any milk-based product)
**Animal produce establishments**
These are:
- packing centres - packing and grading of eggs by quality and weight
- processing plants - processing of egg products
- liquid egg plants - handling of unprocessed egg contents after removal of shell
You need to apply for approval from the Food Standards Agency if you run:
- slaughterhouses
- cutting plants
- game handling establishments
- wholesale meat market
**Apply for approval**
[Food premises approval (England)] [Food premises approval (Wales)] [Food premises approval (Northern Ireland)]
**Approval assessment**
To obtain approval strict hygiene standards, both structurally and procedurally are required. Approval will not be given unless the required standards are met before any food is sold for consumption. The standards are defined in Regulation 853/2004.
You cannot start trading before receiving approval. You must not commence any business activity which requires approval unless you have received conditional or full approval for your proposed activity from the local authority. If you start trading without approval, it is an offence which may lead to prosecution.
Once approved, details of the premises together with information relating to types of foods produced are added to the list of approved Great Britain food establishments and approved establishments with special EU arrangements if in Northern Ireland registers.
**Right of appeal**
You have a right to appeal a decision made by the local authority that has refused to grant an approval.
You can appeal against that decision to a Magistrates Court and must submit an appeal one month from the date when you were notified of the decision.
**List of approved food establishments**
- Approved UK food establishments
- Approved EU food establishments
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504a4ce750e2ee4ed82de0b5d7be45285553420e | Applying for research funding
We commission research and survey work on a contract basis to develop and support its policies.
Calls for tender are submitted through an electronic tendering system and automatically loaded onto tender advertising portals such as Find A Tender, which is the UK e-notification service where procurement notices are published.
To receive email notifications about procurement opportunities you can register as a supplier.
All information on procurement opportunities, existing contracts and tenders are made publicly available. We do not publish commercially sensitive information or information that may be used to obtain an unfair competitive advantage.
Food System Fellow - maintaining food safety and consumer interests in a transforming food system
We are inviting expressions of interest for a three-year fellowship to champion food safety and consumer interests in a transforming food system.
Find out how to apply on our fellowship page.
Quality assurance in our research
Together with the Department of Environment Food and Rural Affairs (Defra), Biotechnology & Biological Sciences Research Council and the Natural Environment Research Council) we have developed a Code of Practice to ensure that science and evidence commissioned by us is consistently of a high and reliable quality.
With DEFRA, we commissioned the United Kingdom Accreditation Service in 2006 to audit a sample of our science and evidence projects against the provisions of the Code.
Findings from the two year audit programme were disseminated and the Code has subsequently been revised as a result of the audit findings.
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53d5623061f4f666a56ec2b2d01cee6d148587e3 | 1. Summary Council to consider the reappointment of Political Assistants to the Conservative and Labour Groups on the Council.
2. Recommendations That posts of Political Assistant be re-established under the terms of the Local Government and Housing Act 1989 with effect from this Annual Council until the Annual Council in 2015 or such earlier date as the Council may later determine, and allocated to the Conservative and Labour Groups.
3. Report Background 3.1 The Local Government Act 1989 governs the appointment of political assistants to provide assistance to political groups represented on the Council. The posts are established within the framework of the Act so that where the members of the Council are divided into different political groups, a political group shall qualify for a political assistant if:-
- The membership of that group comprises at least one-tenth of the membership of the Council;
- The number of other larger groups does not exceed two; and
- Where the number of the other groups which are of the same size or larger than that group exceed two, the Council has determined that group should be the one to which a post of political assistant should be allocated.
3.2 Political Assistants must be appointed on a fixed term contract extending no further than just beyond the next Council elections: each group may only have one post and there may be no more than three in total. Regulation 18 of the Local Government (Committees and Political Groups) Regulations 1990 (as amended) provide that where an appointment is made under Section 9 of the 1989 Act the allocations should be reviewed from time to time.
3.3 The legislation prohibits the making of an appointment until the Council has allocated a post of political assistant to each group that qualifies for one. The appointment of political assistants must be in accordance with the wishes of the political group to whom the post has been allocated. The appointment process must be conducted in accordance with the Council’s procedures and statutory requirements.
3.4 Under the legislation the Conservative and Labour Groups qualify for a Political Assistant each and if the Council agrees to the recommendation to have Political Assistants then two posts must be agreed, to be allocated each to one of these Groups.
4. Implications (including financial implications) 4.1 Resources and Risk None.
4.2 Legal Contained in the body of the report.
4.3 Other Implications None.
5. Background Papers None.
Report Author and Title: F. McGown, Democratic Services Manager Telephone and Email: 01604 837101 [email protected]
October 2007
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b617a1ff58adee556e71179388693500831e9f3c | 1. Purpose
1.1 To seek the confirmation of Council to the appointments to Committees for 2018/19
2. Recommendations
2.1 That the appointments to Committees for 2018/19 set out in the report be confirmed.
3. Issues and Choices
4. Report Background
3.1 The memberships of Committees be as follows:
**Overview and Scrutiny Committee:** (15 members – 8C, 6L, 1LD) Councillor Lane (Chair) Walker (Deputy) Sargeant, Graystone, Flavell, Bottwood, Aziz, Kilby-Shaw, Joyce, Ashraf, Culbard, Russell, Smith, G Eales and Meredith
**Appointments and Appeals Committee** (6 members 4C, 2L) Councillors Nunn (Chair) Larratt (Deputy) Patel, Eldred, Birch and Stone.
**Audit Committee** (7 members - 4C, 3L) Councillors Markham (Chair) Oldham (Deputy) J Hill, Golby, T Eales, Marriott and Stone General Purposes Committee (9 members - 5C, 3 L, 1LD) Councillors Sargeant (Chair) Kilbride (Deputy) Caswell, Parekh, Aziz, Marriott, Cali, Chunga and Beardsworth
Licensing Committee (11 members – 6C, 3L, 1 LD, 1 IND) Councillors Flavell (Chair) Sargeant (Deputy) Caswell, Larratt, Walker, Graystone, Duffy, Culbard, Haque, Beardsworth and Davenport
Planning Committee (13 members 7C, 5 L, 1 LD) Councillors Oldham (Chair) Lane (Deputy), Bottwood, M Markham, Golby, Kilbride, Kilby-Shaw, Russell, Birch, Choudary, Smith, McCutcheon and B Markham
Standards Committee (9 members – 5 C, 3L, 1LD) Councillors Patel (Chair) Oldham (Deputy) Kilbride, Parekh, Bottwood, T Eales, Marriott, Russell and B Markham
4. Implications (including financial implications)
4.1 Policy 4.1.1 n/a
4.2 Resources and Risk 4.2.1 None
4.3 Legal 4.3.1 The Council has a legal requirement to formally appoint members to Committees to enable it to operate lawfully
4.4 Equality 4.4.1 None
4.5 Other Implications 4.5.1 None
5. Background Papers 5.1 None
Francis Fernandes Borough Solicitor 0300 330 7000
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495526c03fb733f934be090a1cd1975d19291939 | 1. Summary To seek the appointments of Councillors Yates and Parekh to the Kingsthorpe Manor and Town Charity and Mrs Margaret Greenwell to the Charity of Hervey and Elizabeth Ekins.
2. Recommendations 2.1 That Councillors Yates and Parekh be appointed to the Kingsthorpe Manor and Town Charity for a further four year period.
2.2 That Mrs Margaret Greenwell be reappointed to the Charity of Hervey and Elizabeth Ekins for a further three year period.
3. Report Background Kingsthorpe Manor and Town Charity
The Council has appointed two Trustees to this charity for many years. The last nominees were Councillor Beardsworth and Jane Hollis whom Council appointed on 1 August 2008. Nominees do not have to be serving Councillors but must be financially solvent and attend at least one Board meeting a year. Under the terms of the Trust the appointments last for four years. Existing nominees can be reappointed.
The function of the Board of Trustees is to apply the clear income of the Charity as they think fit for the general benefit of the people of the Parishes of St John the Baptist, Kingsthorpe and St David, Northampton for which no other public funding is available.
Charity of Hervey and Elizabeth Ekins
The charity promotes the education of young persons up to the age of 25 within the Doctrines of the Church of England who reside within the parishes of St Peter, Weston Favell; St Peter and St Paul, Abington and Emmanuel, Northampton and Doddington. The charity gives financial assistance towards outfits, clothing, tools, instruments or books to help beneficiaries leaving education to enter a profession, trade or calling; apprenticeships; bursaries for travel to pursue education; and financial assistance to study music or other arts. The Council appoints one Nominative Trustee who must reside in or represent an electoral division or ward within one of the parishes covered by the charity. Currently, the Council’s appointee is Mrs Margaret Greenwell of Weston Favell, who is Chairman of Trustees and whose term of appointment has now expired. Mrs Greenwell, the wife of a former Chief Executive of the County Council, is willing to be reappointed for a further period of three years.
4. Implications (including financial implications) 4.1 Resources and Risk None.
4.2 Legal None.
4.3 Other Implications None.
5. Background Papers None.
Report Author and Title: F McGown, Democratic Services Manager. Telephone and Email: 01604 837101 [email protected]
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2994948bf7402f755a86fc5f85a355de440fa487 | Appraisal policy
© Crown copyright 2012
You may re-use this information (excluding logos) free of charge in any format or medium, under the terms of the Open Government Licence. To view this licence, visit nationalarchives.gov.uk/doc/open-government-licence or email [email protected].
Where we have identified any third-party copyright information, you will need to obtain permission from the copyright holders concerned.
This publication is available for download at nationalarchives.gov.uk. 1 Introduction
1.1 The decision to develop a new policy
This policy has been developed in response to the changed conditions for records management within UK government, especially the development of digital records. The National Archives established an Appraisal Policy Project, overseen by a project board, which studied ways to streamline ‘Grigg’ methods of review, the impact of digital records on appraisal methods and the theory and practice of alternative appraisal methods used in archives elsewhere. The draft Appraisal Policy was the subject of a public consultation exercise between 5 April 2004 and 30 June 2004.
1.2 Scope
The policy applies to all public records as defined in the Public Records Act of 1958: ‘administrative and departmental records belonging to Her Majesty’, including ‘not only written records but records conveying information by any other means whatsoever’.¹
Although primarily developed for the records of central government, this policy may be applied to the appraisal of all records created by public authorities as defined in the
¹ See nationalarchives.gov.uk/information-management/legislation/public-records-act.htm Freedom of Information Act 2000 as a means to fulfil their obligations under the Lord Chancellor’s Code of Practice on the Management of Records under section 46 of the Act.
The policy should be read and understood in conjunction with the Acquisition Policy (2000) which sets out The National Archives’ acquisition objectives in the form of eight collection themes which provide ‘the basic definition of the archive which will be acquired in the future’.
1.3 The ‘Grigg system’
The report of the Royal Commission on Departmental Records chaired by Sir James Grigg was the basis of the Public Records Act of 1958 which ended the haphazard legal position as regards duties of custody and retention of public records. The Act defined public records, it assigned duties between The National Archives and departments and within departments regarding custody and control, and it determined timings of transfer of historical records to The Archives (at 30 years) and rights of public access (50 years amended to 30 years in the 1967 Act). In addition to proposing new legislation to define these statutory responsibilities, the Grigg report proposed a system for the review of public records which still obtains today. The key elements of that system were endorsed, with reservations, by a subsequent Committee of Inquiry chaired by Sir Duncan Wilson in a report published in 1981.
The Appraisal Policy recognises that the Grigg system has been an effective means of enabling departments to manage their records and has provided an ordered mechanism for the transfer of records to the archive. Close contacts have been developed between The National Archives and departmental records staff, allowing each to voice and respond to the concerns of the other. The National Archives’ holdings are renowned, records can be readily located and their context is well-explained in the catalogue. This represents a significant achievement for an archive which spans nearly 1,000 years of continuous record-holdings by governments which exercised extensive overseas influence and control.
______________________________________________________________________
2 nationalarchives.gov.uk/information-management/projects-and-work/acquisition-disposition-strategy.htm 3 Committee on Departmental Records. Report. (1954) Cmd. 9163. A further account of the history of this system may be found at nationalarchives.gov.uk/policy/act/history.htm 4 Modern Public Records Selection and Access. Report of a Committee appointed by the Lord Chancellor (1981) Cmd. 8204 1.4 The shape of the future
While recognising past achievements the research conducted in the course of the Appraisal Policy Project indicated that significant changes were needed to accommodate digital records, to streamline selection techniques for paper records, to provide methods which facilitate the application of consistent selection decisions for records held in a variety of media and across government departments, and to ensure records are managed in ways compliant with recent information legislation.
The policy statement which follows this introduction sets out an agenda for change in methods used to select records for permanent preservation. The Appraisal Policy will be supported by standards on procedures for appraisal for both paper and digital records, procedures for the migration of digital records with archival value and by Operational Selection Policies (OSPs)(^5) based on policy principles.
1.5 Summary of the papers
The Appraisal Policy outlines The National Archives’ strategic aims Appendix 1 summarises the long-term shift in appraisal methods envisaged Appendix 2 provides definitions of business and archival values Appendix 3 summarises the ‘Grigg system’ A Background Paper developed for the consultation exercise supports and explains the statements in this policy(^6) The survey of procedures which accompanied the draft Appraisal Policy will be refined and made available on The National Archives’ website
2 Appraisal policy statement
2.1 Appraisal
2.1.1 Appraisal is the process of distinguishing records of continuing value from those of no further value so that the latter may be eliminated.
2.1.2 Our policy is to develop and implement strategies which enable robust and coherent appraisal decisions to be made.
(^5) See Appendix 3 for a description of OSPs. (^6) nationalarchives.gov.uk/documents/information-management/background_appraisal.pdf 2.1.3 Appraisal supports records management because, when carried out successfully it:
- maintains the efficiency of departmental records management systems by limiting their contents to those records which are of continuing value, for business and archival purposes
- ensures that records of long-term or archival value are identified so that provision can be made for their preservation
2.2 The need for an appraisal policy
2.2.1 The development of digital records has prompted the need for The National Archives and UK government departments to appraise, or provide appraisal criteria for, records already created digitally and for digital records being created now.
2.2.2 For the next 20 years The National Archives will accession records predominantly in paper form, and departments will need to provide for the appraisal and retention of their paper records.
2.2.3 There are limited resources within the UK civil service available for dealing with records management and their effectiveness needs to be maximised and the case made for increasing resources to fulfil statutory requirements.
2.2.4 The public availability environment created by Freedom of Information legislation requires departments to document their appraisal work and provide justifiable reasons for keeping or destroying records.
2.2.5 Agencies, non-departmental public bodies (NDPBs) and other bodies have been created over the past 15 years ‘to carry out the executive functions of government within a policy and resources framework set by departments’(^7). As a result the machinery of government has radically altered since the Grigg Committee considered departmental records management requirements.
2.3 Aims
2.3.1 The National Archives will engineer a shift to a system of appraisal that will be applicable to the new environment created by digital records.
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(^7) The Prime Minister's Office of Public Service Reform Better government services. Executive agencies in the 21(^{st}) century (2002) 2.3.2 The National Archives will ensure the continued and timely transfer of paper records to The Archives, as these will continue to be the main form in which we will accession records for at least the next 20 years.
2.3.3 The National Archives will ensure that appraisal for archival purposes selects records of the highest archival value, avoiding duplication (see Appendix 2).
2.3.4 The National Archives will provide appraisal methods which will integrate the appraisal of digital and paper records as well as records produced in any other medium.
2.4 Principles of appraisal
2.4.1 The future of the Grigg system
2.4.1.1 Elements of the Grigg system – the specific timings for review and extensive file by file review - are not practical for assessing the archival value of digital records. (See 2.4.3 for alternative approaches.)
2.4.1.2 The Grigg system will be retained as the means to safeguard the continuing transfer of records in all other media to The National Archives as long as departments need it to ensure compliance with section 3(4) of the Public Records Act 1958. To this end The National Archives will strengthen elements of the Grigg system by:
- reasserting the importance of disposal schedules, and of first review where it persists, and ensure consistent criteria are applied in departments
- reasserting the importance of clear selection criteria and The National Archives monitoring at second review, while ensuring that second review is targeted on records with high potential archival value
______________________________________________________________________
8 ‘Public records selected for permanent preservation under this section shall be transferred not later than 30 years after their creation either to the Public Record Office or to such other place of deposit appointed by the Lord Chancellor under this Act as the Lord Chancellor may direct’
9 A disposal schedule is ‘a set of instructions allocated to a folder to determine the length of time for which the folder should be retained by the organization for business purposes and the eventual fate of the folder on completion of this period of time’. See nationalarchives.gov.uk/information-management/projects-and-work/information-records-management.htm. Accommodating the need to retain records for archival purposes is an element in the development of disposal schedules implementing Grigg recommendations for a government-wide approach to case files and datasets\\textsuperscript{10}, to ensure rational archival selection and to aid departmental management of such records
2.4.2 Record creation and disposition
2.4.2.1 Effective appraisal, especially in the digital environment, is dependent on good systems of records creation and business scheduling of records.
2.4.2.2 The National Archives will assist in this process and will:
- influence the current implementation of Electronic Records Management (ERM) Systems\\textsuperscript{11} so that file plans are created which enable the appraisal of records for business and archival value
- provide procedures for the appraisal, migration and transfer of digital records
- reassert the importance of other elements of robust systems for the creation of records, including clear guidelines for naming, filing and storing documents, in all formats
- encourage and assist in the development of disposal schedules across all records in all formats
2.4.3 Macro-appraisal
2.4.3.1 Macro-appraisal can be defined as assessing the value of records at a government, departmental or unit level rather than at an individual document or file level.
\\textsuperscript{10} Case files, sometimes referred to as ‘particular instance papers’ are records series whose component files cover the same subject matter though each relating to a different person, body or place. As the Grigg Committee commented: ‘While each individual document may be of little importance by itself, taken together or by way of sample these papers enable certain broad conclusions as to historical, economic, or social trends to be drawn’. (para 62). Datasets may be the approximate digital equivalent of case files
\\textsuperscript{11} An Electronic Records Management System may be defined as: ‘An Environment applied to digital records using application level software to control the behaviour of digital records throughout their life [within the system] until their disposal is determined and in particular the accrual of metadata 2.4.3.2 Macro-appraisal encourages government-wide or organisation-wide analysis of functions as a guide to identifying records of value for business and archival purposes. It may be appropriate to digital records because, by identifying records produced by the most significant functions, it provides the means to make appraisal decisions without the need for file by file scrutiny or the ‘historical perspective’ provided by the passage of time.
2.4.3.3 The National Archives traditionally assessed the archival value of records with reference both to their provenance (the organisational and functional context in which they were created) and to their content. The National Archives will in future make an understanding of the functions which produced public records an overt, preliminary stage in appraisal work.
2.4.3.4 The National Archives will make the final assessment of the archival value of public records according to the selection criteria laid out in Appendix 3 of the Policy and in the Acquisition and Disposition Policies.
2.4.3.5 Macro-appraisal will be used as an aid to:
- inform the way paper review is conducted
- identify areas of file plans created in an ERM system of potential archival value
- provide appraisal guidelines for ‘hybrid’ records (records stored in more than one format but especially in a combination of digital and paper form) produced in the period between the introduction of the computer and the introduction of full ERM systems
- identify datasets and case files of potential archival value
- identify areas of overlap between departments, so avoiding duplication in material selected for the archive
2.4.3.6 The National Archives will develop generic archival appraisal guidance for categories of records such as those produced by similar types of departments (agencies, regulatory bodies) or those produced by activities common to many departments (research papers, inspection reports). 2.5 Implementation
2.5.1 Methods and procedures have been developed to fulfil the aims in this policy and to allow for the controlled transition to modified systems of review. These were published as Appendix 3 of the consultation paper and are available on The National Archives’ website.
2.5.2 Further implementation will be developed in consultation with government departments.
2.5.3 The National Archives will continue to:
- provide guidance on the maintenance of digital records over time and developing disposal schedules for common administrative records
- provide selection criteria for archival records and monitor departmental selection of public records in whatever medium for permanent preservation and transfer to the archive
2.6 Responsibilities under the Public Records Act, 1958
Departments are responsible for making ‘arrangements for the selection of those records which ought to be permanently preserved and for their safe-keeping’.
The National Archives is empowered to give guidance, co-ordinate and supervise all action taken in pursuance of the above(^\\text{12}).
3 Your questions answered
The following questions arose in the course of the public consultation exercise and are answered here. Further common questions about the public records system are answered
(^{12}) Sections 3(1) and 3(2) of the Acts state:
It shall be the duty of every person responsible for public records of any description which are not in the Public Record Office or a place of deposit appointed by the Lord Chancellor under this Act to make arrangements for the selection of those records which ought to be permanently preserved and for their safe-keeping. Every person shall perform his duties under this section under the guidance of the Keeper of Public Records and the said Keeper shall be responsible for co-ordinating and supervising all action taken under this section. in the frequently asked questions section attached to The National Archives’ Acquisition Policy.
3.1 What is the expected time frame within which the shift from Grigg will occur?
There is no specific time frame common to all departments. The National Archives will prioritise areas where guidance is needed and departments and types of records where generic archival appraisal policies can be devised, and will respond to specific departmental requests for guidance and directions relating to paper or digital records. Departments are encouraged to continue with Grigg methods for paper (other than those produced in a hybrid paper/digital environment) and these may well persist for another 30 years.
3.2 Have appraisal values changed?
The Policy proposes that an assessment of the value of the functions carried out by an organisation will be the main element in the appraisal of digital records produced by it. Even so for datasets, where they are the digital equivalent of case files, procedures have been established in which the informational content and research value of the records remains an important element in appraisal. The statements in para 2.4.3.4 and in Appendix 2 are intended to demonstrate that The National Archives will continue to make decisions about archival value on the basis both of an understanding of a record’s provenance and of an assessment of the record’s information.
3.3 Will there be a reduction in the numbers of review staff?
The National Archives would encourage a streamlining and sharing of knowledge among staff dealing with appraisal for archival purposes and to implement FOI and ERM systems. There will need to be a process of retraining and reorientation of working practices. The National Archives believes that the expertise of existing review staff can and should be utilised to guide a more targeted approach to second review and to assist in the development of disposal schedules for paper and for file plans under ERM systems.
3.3 Will there be training provided in the meaning of macro-appraisal?
The Appraisal Policy will necessitate a reconsideration of the training needs of all staff involved in the process of appraisal at The National Archives and in departments. 3.4 Will records be transferred to The National Archives earlier if Grigg review timings no longer apply across the board?
Section 3(4) of the Public Records Act (1958) still applies(^\\text{13}), so records must be transferred to The National Archives 30 years after their creation. The need to identify digital records for permanent preservation at or near creation creates the possibility of early migration of such records to the archive. Paper records may also be reviewed earlier, for instance under procedures whereby first and second review are merged. We shall be examining the options for this in the light of continuing departmental business needs and Freedom of Information legislation.
3.5 Where can I find the proposed procedures for appraisal and review?
In the course of the Appraisal Policy Project some pilots were conducted into new ways of carrying out second review. The draft Appraisal Policy which was circulated for public consultation contained an Appendix 3 which outlined procedures for: appraising the records of agencies using macro-appraisal, cross-departmental methods; appraising case files and datasets produced in the course of carrying out a function across departments; streamlining full file by file second review methods or merging first and second review. That Appendix 3 has not been published as part of the finalised Appraisal Policy but will be revised in the light of comments received during the consultation exercise and published on The National Archives’ website as guidance. It will be regularly updated in the light of experience. It will form part of discussions between The National Archives and departments on their appraisal needs in the implementation phase.
(^{13}) ‘Public records selected for permanent preservation under this section shall be transferred not later than 30 years after their creation either to the Public Record Office or to such other place of deposit appointed by the Lord Chancellor under this Act as the Lord Chancellor may direct’ APPENDIX 1: Summary of the proposed shift in the timing, purpose, staffing and scope of appraisal
| Elements in the appraisal process | The present: Grigg review | The future: | |-----------------------------------|---------------------------|-------------| | | | Appraisal (digital and hybrid records) | | | | Appraisal + review (paper and other records) |
| When are appraisal criteria applied? | 1<sup>st</sup> review (5 years from closure) | At any point, but | |-------------------------------------|---------------------------------------------|------------------| | | 2<sup>nd</sup> review (25 years from the initial date of the record) | (a) for electronic records: | | | | ● before creation through file plans | | | | ● at creation through filing on to folders with disposal already attached | | | | ● at moment of migration for preservation of semi-current records | | | | ● at moment of migration to more permanent storage | | | | (b) for paper records: | | | | ● maintain current timings but earlier 2<sup>nd</sup> review may be appropriate | | | | ● review with electronic records where they are linked |
| Why are appraisal criteria applied? | 1<sup>st</sup> review to assess the future business use of the record (+ an awareness of historical value) | Business and archival appraisal values are defined in Appendix 2 | |-------------------------------------|-----------------------------------------------------------------|---------------------------------------------------------------| | | 2<sup>nd</sup> review to assess the historical value of the record | |
| Who applies the appraisal criteria? | 1<sup>st</sup> review by business units in departments or by a discrete group of 1<sup>st</sup> reviewers in departmental records centres: some The National Archives spot checks | These units are still involved but in different ways. | |-------------------------------------|-----------------------------------------------------------------|---------------------------------------------------------------| | | 2<sup>nd</sup> review by discrete group of 2<sup>nd</sup> reviewers in departments with direct The National Archives monitoring | Decisions about specific records or sets of records are preceded by analysis of all or a wide range of the records related to the organisation or function. This initial process will involve more collective effort for both business and archival purposes, enlisting the expertise of The National Archives client managers, reviewers, and past and present business users. |
| What is the range of records to which archival appraisal criteria are applied? | Each group of records is reviewed separately, with limited cognisance of decisions made for similar or related records in other departments or divisions | The new method will encourage: | |---------------------------------------------------------------------------|-----------------------------------------------------------------|---------------------------------------------------------------| | | The new method will encourage: | (a) the consideration of all the records produced by an organisation, or by several organisations in the course of fulfilling the same function | | | | (b) awareness of where similar or related records reside in government | | | | (c) development of common/generic selection criteria for types of records and types of record-creating bodies | APPENDIX 2: Appraisal values
1. The value of records has two elements: their ‘primary’ value to the organisation (business value) and their ‘secondary’ value to society, providing a resource for historical research to a wide range of future users (archival value).
2. Appraisal of the business value of records should be carried out in such a way as to:
- assist efficient and effective administration through reducing the time taken to retrieve information
- ensure pertinent material is retained for as long as it is necessary to enable informed policy development
- allow departments to account for the management of resources and policy-making to the public (UK citizens and organisations, and overseas bodies), and in the course of legal and financial scrutiny
3. The aims of archival appraisal are to:
- determine which records have the highest archival value. All records can be deemed of potential archival value but an archive must be able to preserve and conserve records permanently and must therefore limit its acquisitions to records of the highest archival value
- avoid duplication in the selection of archival material
- develop consistent archival appraisal decisions within and across departments
- support the strategic objectives and collection themes of The National Archives’ Acquisition Policy
4. Records should be selected for the archive which show the significance of the functions and activities of departments and which provide information relevant to The National Archives’ Acquisition Policy.
5. Records of the highest archival value are those which:
- are most capable of documenting change, continuity and development over time and of assisting historical interpretation of such changes
- document the functions of departments and of government as a whole
6. Appraisal should be carried out in such a way as to select records of the highest archival value in respect of:
- events
- institutions
- policies • processes and procedures • social development, including demographic, cultural and economic change • changes to the physical environment
APPENDIX 3: Summary of the ‘Grigg System’
The ‘Grigg system’ has two main elements: a system of timing and procedures recommended by Grigg and then implemented by The National Archives and departments; and the advice and guidance given by The Archives on how reviewers assess the value of records.
The Grigg system
a) All registered paper files, except case files, are closed after a maximum of five years b) Five years after a file has passed out of active use departments (either the business users or the departments’ records centres) carry out ‘first review’ at which they decide whether the file has any continuing administrative value to the organisation or could have administrative value in the future. Files may be destroyed immediately or earmarked for destruction without further review after a stated period c) Twenty five years from the initial date of a file (supposing it survived first review) reviewers in departmental records centres, under The National Archives’ supervision, carry out “second review” at which they decide whether the file has ‘historical’ value. Those that have are transferred to The National Archives, or a recognised place of deposit d) ‘Case files’ (today a term which includes datasets) are dealt with outside the system of review. Grigg proposed that all case files created across government be appraised as a whole, enlisting historical advice e) Specific guidance applies to unregistered files, such as private office papers, films, sound recordings f) The National Archives advice on how to decide what records are of historical value has been given in various manuals for departments and, more recently, through the Acquisition and Disposition Policies and the accompanying Operational Selection Policies (OSPs) g) The Grigg Committee, the subsequent Wilson Committee, and ensuing (National Archives) advice all emphasise the need for good systems of records creation and the extensive use of disposal schedules h) The timing of disposal for common administrative records is closely regulated in many departments by disposal schedules, supported by general guidelines provided by The National Archives for classes of administrative records, such as accounting records, legal records, personnel records, estate records and so on. Determining the value of records
The National Archives gives guidance to enable reviewers to judge the value of records, especially in terms of ‘historical value’:
a) At first review the main criterion is administrative need for departmental purposes supplemented by two caveats made in the Grigg report: that first review should take place as soon after closure of the file as possible thereby ensuring more records are retained; and that at first review consideration be given as to whether the function being carried out might arise again in the future, for example, rationing. In addition, The National Archives advises that in a few cases the records’ possible historical value be taken into consideration at this stage.14
b) For second review The National Archives’ orange Manual of Records Administration defined two types of selection criteria for records: selection to show the significance of the functions and activities of the department or selection on the basis of the informational content of the records. The Manual further recommended that reviewers should provide material for research into:
- the history of the department, its organisation and procedures
- the formulation of policy and legislation and, more selectively, its implementation and interpretation
- notable events or persons when the records add significantly to what is already known
- major events, developments or trends in political, social, legal or economic history
- scientific, technological or medical research and development
- regional or local conditions when it is unreasonable to expect information to be available locally, when it is convenient to hold it centrally, or when it is known that significant local information does not survive locally
- demographic, medical, social, cultural and economic history and historical geography, by means of statistical and quantitative research.15
______________________________________________________________________
14 PRO Government Services Division Manual of Records Administration August 1993, para 3.3.6. Grigg states that the terms ‘for its own Departmental purposes’ be interpreted to cover ‘the likelihood of the paper being required as a precedent or as a guide to possible action should a similar set of circumstances arise in the future.’ Such a proviso would catch records showing a Department was organised in order to carry out a set of policies or procedures or it might stop the destruction of papers because the activities they dealt with had ceased, such as rationing. The National Archives, in common with many archives around the world generally adopted the taxonomy of value developed by an American archivist, TR Schellenberg. He argued that a record has two different layers of value - a primary value or the value to the organisation that created them and a secondary value to historians. ‘Primary value’ consisted in the value to the organisation for administrative, legal and fiscal purposes of records and ‘secondary value’ consisted in value to other users, to historians, value that was never intended by the creator. And within secondary value, there was ‘evidential’ value - a value derived from the way the record documented the history structure and functions of an organisation and ‘informational’ value or value in providing research material on persons, places and subjects. See TR Schellenberg, Modern Archives. Principles and Techniques (Chicago: University of Chicago Press, 1956); TR Schellenberg, The Management of Archives (New York: Columbia University Press, 1965)
15 Manual para 3.6.11 c) In 2000 The National Archives published its Acquisition and Disposition Policies (see 1.2). The Acquisition Policy defines the limits of the archive. It works in conjunction with the Disposition Policy which is a framework of principles on which to base decisions to offer public records to an archival institution other than The National Archives.
d) Since 2000 these two policies have been developed using Operational Selection Policies (OSPs). 28 of these exist which probably now cover 20% of the records accessioned into The National Archives each year. The OSPs cover specific sets of case files (coroners’ records), or disposal of all of the records of a department (Royal Mint) or may cover a theme such as recreational use of the countryside.
e) The Grigg Report recommended that a Committee be set up under the auspices of the PRO to conduct a census of what case files are in departments, and ‘to determine what papers, if retained, would give the greatest amount of information in the smallest amount of space’ and so ‘decide which papers, and in what quantities, should be preserved’\\textsuperscript{16}. A Particular Instance Papers Committee (PIPC) met in the 1960’s, but the census was never conducted. Since 200 the role of the PIPC has, to an extent, been filled by the Records Review Panel, an internal committee based in the Records Management Department of The National Archives.
\\textsuperscript{16} Departmental Records para 109
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4916780a63a0adcc9bfbad92dd7c0a0e297f98e1 | | Figure | Description | Headcount as at 31 Mar 2020 | Comments - 2020 | |--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------|---------------------------------------------------------------------------------------------------| | A | The number of employees whose employment in England by the body began in the reporting period in question | 590 | | | B | The number of apprentices who began to work for the body in that period and whose apprenticeship agreements also began in that period.\
• This includes employees who were already working for the body before beginning their apprenticeship, as well as new apprentice hires. | 31 | Schools = 4\
Existing = 19\
New employees = 8 | | C | the number of employees employed in England that the body has at the end of that period. | 3,748 | | | D | the number of apprentices who work for the body at the end of that period. | 52 | Schools = 13\
Existing = 20\
New employees = 19 | | E | Figure B expressed as a percentage of figure A. | 5.25% | | | F | Figure D expressed as a percentage of figure C. | 1.39% | | | G | The number of apprentices who worked for the body immediately before that period | | | | H | Headcount on the day before the first day of each reporting period in the target period; | 3,933 | | | I | Figure B expressed as a percentage of figure H | 0.79% | |
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8a5df90cd79b48f91c8981391513fcf325b8969d | 1.0 Introduction
This Design and Access Statement is in support of a householder planning application for the extension of the house at Sheldon House Farm, The Brund, SK17 0HP. 2.0 The Applicants
2.1 The Owners (us!)
We are a family of 4 and have purchased Sheldon House Farm as our home. Our oldest child is 4 years old and we hope that she will start attending a local primary school in September 2018. We chose this house because of our family connections with the area: I grew up on a small-holding not far away in Onecote and we got married in St. Peter’s Church, Alstonefield. My family have been farmers in Leek and Upper Hulme for centuries so the idea of living on a small farm seemed to me to be natural. The opportunity to purchase such a property is rare and we are very excited to be in ownership of it. We hope for Sheldon House Farm to be our home for many years to come.
Our aspirations are to create a family home that will give our children the space to grow whilst appreciating and benefitting from the beautiful location in which we will live. We fully understand the responsibility of being the custodian of a property within a conservation area and National Park. As such, we are keen to ensure that any works we carry out to the property both improve and enhance the house and the area.
2.2 The Architect (me!)
I am an architect with many years of experience of working within conservation areas, on listed buildings and in national parks. Much of my career was spent working with Chris Hesketh, a well-respected local Conservation Architect at ctd architects in Leek. In addition, I spent 8 years working in Manchester and London in architectural practices who specialise in the design of high quality one-off private houses (reuse, extension etc). I have a post graduate diploma in Sustainable Heritage from the Bartlett School of Graduate Studies at UCL. I strongly believe in a sensitive and balanced approach to design and the environment and feel that heritage buildings are deserving of a good quality modern design response.
With ctd architects I worked on a wide range of projects including Natural England grant schemes within the Peak Park, the William Butterfield Parsonage in Sheen and St. Peter’s Church in Alstonefield. Further afield, I worked on heritage assets within the potteries (one of which was awarded Retrofit ‘Highly Commended’ award 2013 by the AJ. I also designed a contemporary wedding venue within the curtilage buildings of a Grade II listed manor house facing onto a Grade I listed Norman church.
Whilst practicing in Manchester I designed houses within greenbelt countryside surrounding Alderley Edge and worked on the Grade I listed former bank of England on King Street, Manchester. In London I worked for a practice the focus of which is high-quality, bespoke design mainly in the context of private dwellings. A copper clad modern extension to a Grade II listed house on Chalcot Crescent that I worked on in 2012 was shortlisted for Camden Design Awards in 2013. 3.0 The Site
3.1 Site Location and Context
Sheldon House Farm is located within the hamlet of Brund in the South-West Peak area. The nearest villages are Sheen, Longnor, Hartington and Hulme End. The River Manifold runs to the west and forms a natural boundary along which the land ownership of Sheldon House Farm finishes. The Brund sits to the south west of Sheen Hill, due north of Ecton Hill. The hamlet is within a Conservation Area.
Brund is a small agricultural hamlet of coursed gritstone farmsteads and cottages dating from the 17th to 19th centuries. (PDNPA, p.1)
The hamlet is formed of a dense collection of farmhouses, cottages and outbuildings. These relate to each other through a series of gritstone walls which create small pockets of land in the form of gardens and accessways.
As with most of the dwellings in The Brund, Sheldon House faces south and sits perpendicular, with a gable, to the main road. It is one of the larger and more recently constructed dwellings in the settlement.
The hamlet takes the form of a compact, linear settlement with the farmsteads and workers cottages set in close proximity to one another. The narrow lane that passes the houses on their east side is bounded by low dry-stone walls. The ground falls away towards the river in the west affording views down the valley towards Hulme End and Ecton Hill.
Fig 2. Extract from OS map showing Brund (circled orange) in relation to Sheen, Hartington and Longnor
Fig 3. View towards Rose Cottage (right) and Plum Tree (left), 2018. Plum Tree Cottage, date unknown. The Brund contains a unique collection of buildings with much of its value as a ‘heritage asset’ being in the group of cottages – a cluster of small cellular units linked by small pieces of ground, ‘lanes’ or paths and low gritstone walls. The quality of the built environment at The Brund is high with several of the buildings being grade II listed. None of the buildings within the curtilage of Sheldon House Farm are listed. Sheldon House sits away from the cottages distinguishing them, in particular, as a group. Sheldon House is an individual entity, further west and separated from the group by a track and a garden wall and then by a driveway and garden.
In August 2017 Sheldon House Farm was sold by auction, as were the three neighbouring farmworkers cottages (Hillside, Plum Tree and Rose Cottage), Lime Tree Farm and 131 acres of land, all divided between 10 lots. Sheldon House Farm was sold to us as a smallholding with approximately 12 acres.
The situation that we, as ‘stakeholders’ in The Brund, now find ourselves is quite unique - Most of properties in this close-knit hamlet are now in new ownership and have, in the main, been purchased for owner occupation. This will see a new lease of life being breathed into the hamlet.
3.2 The Existing Site and Building
It is believed that Sheldon House, in its current form, was built in 1888 by Professor John Prince Sheldon, an author, mainly on the subject of dairy farming. Professor Sheldon was also appointed to the Chair of Agriculture at the Royal Agricultural College, Cirencester in 1877. Sheldon inherited the house from his aunt, Hannah Prince upon her death in 1881. It was the house that his mother, Jane Anne Prince, Hannah’s sister, had grown up in. According to an interview (source unknown) with Professor Sheldon in March 1913, a few months before his death,
Two hundred and forty years ago this ancient home and farm was bequeathed by Robert Ryley to his nephew John Prince, and the Prince family have resided thereupon ever since. The present owner [JPS] is the fifth John Prince, and he took up his headquarters here in 1863. It was bequeathed to him by his mother’s sister, Miss Prince [Hannah], in 1881.
Fig 4. Extract from Tithe map, 1845, showing The Brund. Sheldon House is the ‘homestead’ in plot 539. The house that stands on the site today is not entirely the same one inherited by John Prince Sheldon. This man was a 'moderniser' with a specific interest in dairy farming and his ownership of the property began towards the end of the high farming years. It is probable that he rebuilt the house and associated outbuildings in order to bring the farmstead up to date thus maximising productivity. This rebuilding saw the farmhouse becoming larger than its predecessor (likely 17th century cottage/s).
There was extensive rebuilding of farmsteads in the Peak District in the 19th century, the result being that relatively few buildings appear to be substantially complete survivals from the 18th century and earlier. (PDNPA, 2017, p.14)
Sheldon House and its outbuildings are constructed from coursed gritstone with Staffordshire Blue plain clay tiled roofs. The house and the south facing element of the barns both have coped verges and pitched, tiled dormer windows at loft level. A date stone on this section of the barns reads 1888. It is likely that the house was remodelled at this time – a theory supported by OS maps from 1880 and 1899.
The house itself is 2 storeys plus an attic in height and T-shape in plan form. The windows are mainly white painted timber sliding sashes some of which were replaced in the 20th century. A single stained modern timber casement window exists to the kitchen at the rear of the house. The front attic bedrooms are lit by two mullioned windows and the rear attic bedrooms by a casement window.
When studying the plan and elevations it is clear that the house has evolved and grown over time. Elements of the ground and first floor south wing of the house have 17th or 18th century roots, evident in the stonework. The entrance porch, gothic arch window, attic dormers and entire north wing were built later, probably by John Prince Sheldon. On the front elevation a door to the right of the main entrance was turned into a window by the Critchlow family in the early-mid 20th century.
Despite looking relatively grand from the outside, the house is formed of a series of small square rooms with low ceilings and exposed beams and joists resulting in a cottage-esque feeling. The entrance door and porch give the impression of an impressive entrance space behind but in fact they lead directly into what was a reception room. The front section of the house appears to use the body of an old cottage as its base whereas the rear of the house seems to have been rebuilt over an older cellar. The two sections are linked together by an awkward curved corridor.
Two staircases access the first floor where the bedrooms have slightly higher ceilings. The attic bedrooms are accessed via a further two separate staircases, one in each ‘wing’ of the house. There is one small bathroom serving 7 bedrooms. John Prince Sheldon lived at Sheldon House Farm (then a house called 'The Brund' - it was named Sheldon House by the Critchlow family in the mid-20th century) between 1881 and August 1913 when he died. In 1918, the farm was sold at auction to the Critchlow family who remained in ownership of it until 2017. In the 1970s, the deaths of the Critchlow parents lead to the ‘modernisation’ of the house removing all features of any architectural or historic value: The only plumbed and heated Victorian bathroom in the area (this was in a two-storey extension at the rear of the house); Victorian central heating; and all fireplaces. In 2018, the house is in a state of disrepair having been lived in by an elderly brother and sister for many years.
A comment made by nearly every visitor to the house during the pre-auction period and since it came into our ownership, is that for such a grand albeit 'higgledy piggledy' façade, the interior is distinctly underwhelming in terms of layout and lack of original features. On the ground floor the small rooms lead directly into one another; the entrance hall has no sense of ‘arrival’ about it; the curved corridor that links the two wings together crashes through the rear wall of the house (fig. 8) creating a strange curve in the current ground floor cloak room; the kitchen is tiny; the rooms are dark with low ceilings; it is damp, draughty and lacking in central heating; the ratio of bedrooms to ground floor family space is high and the ratio of bathrooms to bedrooms is low. However, part of what excites us about the house is this sense of evolution and potential for the story to continue.
The house is separated from the farmyard by a high stone ‘garden’ wall and has its own driveway accessed from the main road. The wall has a door passing through the middle, surrounded by large stone quoins and the curved sloping section of the wall down to the farmyard gate is topped with hand carved curved coping stones. Unfortunately, the stone wall was built too high and too narrow with a copper beech tree planted within a metre of it. The strength of the tree along with the design of the wall, have contributed to the destabilisation of the wall over time. It is currently in danger of toppling into the farmyard, bringing the doorway with it (Fig.10). We have removed the coping stones and have them in safe keeping for rebedding when the wall is stabilised.
The house is joined to the main body of the garden wall by another section of wall at the same height, behind which hide the two stone lean-to buildings. There is no visual link between the front and back of the house other than through a doorway. There is a grassed area forming a basic garden to the east of the house, a concrete courtyard to the rear of the house and a vast area of tarmac following the driveway down towards the house and continuing past the front of the house to the farmyard. A lower stone wall forms the boundary between the farmyard access track and the tarmacked area to the front of Sheldon House.
The house sits to the east of the farmyard which contains a T-shaped range of stone outbuildings. Along with the tall garden wall, these enclose 3 sides of the main farmyard. These were constructed in the 1880s. To the west of the stone buildings are two modern agricultural buildings within a second farmyard which links directly to the land. The linear development of the hamlet as well as the way in which the curtilages were divided for the auction has resulted in Sheldon House Farm being in ownership of a long plot of farm land spanning from the main road to the river Manifold and becoming narrower as it approaches the road.
3.3 Heritage Value
The historic nature of The Brund means that there is potential for the place to yield evidence about the past. Sheldon House has been dramatically altered over time, diminishing its significance as a piece of built heritage, hence the fact that it is not listed.
In terms of aesthetic value, The Brund is of great significance but much of this can be attributed to the tightly knit group of small farm workers cottages composed of Rose Cottage, Hillside Cottage and Plum Tree Cottage and the interlocking group of gritstone walls that form the spaces and divisions between these cottages. Sheldon House is set away from this group, and whilst it is larger than these cottages, its architectural and aesthetic contribution to the group is less. As has been previously described, the house is not of one single style but a mixture, resulting in something that is more convoluted than cohesive.
Historically and communally, The Brund as a collective including New House Farm and Sheldon House, has a great deal of value. Since August 2017, we have been fortunate enough to become part of an already established wider community. It is apparent that the hamlet has meaning for many people even outside of its boundaries and the link to the Critchlow family is live.
The social history links between Sheldon House Farm and Professor John Prince Sheldon are fascinating. Learning from the past is important to us and we hope to continue this journey. It is important to note though that these houses and cottages are now in new ownership and what has been neglected for some time will now be given a second chance.
The Heritage Environment Record has been consulted but yielded no useful information.
3.4 Neighbouring Trees
Three mature copper beech trees were planted just inside the stone wall boundary which forms the residential curtilage of the house. Along the boundary with the farm access track is a diseased chestnut tree, a cherry tree and a beech tree. Hamps Valley Tree surgeons submitted an application to the Peak Park Authority on our behalf for the removal of the copper beech tree adjacent to the tall garden wall and the diseased chestnut tree to the front of the house. No objections were received. The copper beech tree has been removed in order to preserve the tall garden wall and to allow the south-west gable of the house to dry out.
3.5 Recent Planning History
There is no planning history related to Sheldon House Farm.
The owners of Limetree Farm have recently submitted an application for the proposed extension to dwelling and conversion of attached outbuildings to ancillary living space (application number NP/SM/0118/0011). This has recently been approved. 4.0 The Existing House
4.1 Photographs
From top left to bottom:
Front of house viewed from south-east, towards removed tree and toppling garden / farm-yard wall;
rear of house viewed from north-west;
From top right:
garden wall returning to meet house on west elevation;
looking into corner of garden wall, cess-pit manhole cover and svp from outside WC;
north elevation of house; west elevation of house showing modern casement window and concrete porch and wash house;
inside of external wc room;
inside of existing kitchen; From top left:
View towards removed tree, toppling garden / farm-yard wall, and rotten timber, stone and metal garage;
garage in the farmyard context;
tall garden wall, door into WC and through wall into rear courtyard;
garden / farmyard wall and timber, stone and metal garage;
garden / farmyard wall and timber, stone and metal garage;
corrugated metal barn 5.0 Precedent and Inspiration
5.1 Precedent: Faha Farmhouse, Jamie Fobert Architects
An original grouping of a cottage and barns looking out towards Galway Bay was retained and extended. Materials used include zinc, timber and stone and forms are shed-like'. Both reflect the rural nature of the site.
5.2 Precedent: Watergate Phase 1, James Gorst Architects
The refurbishment of an existing stone barn (in Oxfordshire) into an artists studio and the linking of the two by a new two storey timber building providing garaging and staff accommodation. 5.3 Precedent: Boreraig House, Dualchas Architects
A new house built on an old croft on the Isle of Skye. The house is constructed from Scottish stone and larch cladding and corrugated metal: All materials found in the landscape (walls, fences, roofs). It is heavily insulated and utilises external shutters as a barrier against the winds.
5.4 Precedent: Dovecote Studio, Haworth Tompkins Architects
The project reuses a derelict brick structure within the curtilage of a grade II listed building at Snape Maltings near Aldeburgh in Suffolk. A Cor-ten steel lining sits inside of the existing brick structure, retaining it as existing. The new building is a simple form with a pitched roof. 6.0 Design Proposals
6.1 Site Constraints and Opportunities
Sheldon House is located within an area that is very clearly delineated as residential curtilage by a drystone wall. The house sits towards the bottom of the plot close to the tall garden wall creating a small pocket of space between the house and the stone wall. Two lean-to ‘out-houses’ sit, concealed behind the tall wall, within this space. One of these buildings is an outside WC, the other a shed - neither relevant to the current or future use of the house or farm. Along with the charming but degraded timber garage, they are linked by awkward unusable space. There is an opportunity to utilise this space by replacing the WC and shed with habitable space.
6.2 Use
The existing house is awaiting modernisation.
6.2.1 Problems
We have identified several issues with the way in which the current house is configured,
1. The ground floor circulation lacks sensible flow.
2. The kitchen is small and located in the north wing of the house.
3. The ground floor accommodation is not well balanced with the first and second floor provision.
4. There is only one bathroom to service 7 bedrooms.
5. Two existing residential ‘outbuildings’ and an old timber garage with a footprint of 42 sq m GEA that could be better integrated.
6.2.2 Solutions
1. Reinstate entrance hall in centre of front wing rather than utilising as a reception room. Allow the remaining rooms to radiate from here.
2. Relocate the kitchen to the western-most room in the south elevation thus creating a room that is double aspect with a south facing window, is accessible from the main entrance hall and has the opportunity to be extended to create a dining space and family room.
3. Extend the ground floor to the side of the new kitchen location into the space behind the garden wall, replacing... the WC, shed and garage. New extension to contain dining area and family room, study area and utility room.
4. Positioning kitchen and utility room at the western most point of the house creates a more sensible drainage solution minimising impact on the character of the existing house.
5. Utilise existing spaces created by outbuildings and garage. Incorporate into extension to increase habitable floor area with minimal impact. New footprint to be 56 sq m GEA (increase of 14 sq m).
6.3 Proposal
Sheldon House has been neglected for many years and as a result looks quite 'down at heel'. The house requires substantial investment in order to become a comfortable home suitable for a young family. Any improvements we make now must allow flexibility and space for our family to grow into the future.
Elevationally, the house has stature especially when viewed from the south east. Any moves we make in terms of improving or extending the house must not be so apologetic as to diminish this but at the same time must acknowledge and celebrate the solidity and grandeur of the existing building, allowing it to stand proud.
We propose to maintain the two main entrance doors (on the south and east elevations) into the house, removing the flat roofed concrete porch to the north elevation and creating a window opening here in replacement of the door.
What is currently the kitchen will become part of the adjacent room giving a double aspect to a dark space. We would like to remove the modern stained timber casement window and replace it with a set of painted timber framed glazed doors to give access into the domestic courtyard area to the rear of the house. This room will be a playroom, evolving as the children grow.
We propose moving the kitchen from its location at the rear of the house into a new location to the west of the front wing. This location has dual aspect both north and south but is still not large enough to provide a family kitchen and eating space. Whilst in its new position it is well connected to the entrance hall, due to the cottage origins of the plan it does not have enough space to accommodate our family before, during and after mealtimes in addition to being a place in which to prepare food. In order to make sense of the location of the entrance door, we see the space to the right of the new kitchen being primarily an entrance hall from which circulation to the rest of the house radiates. We would, therefore, like to create a small extension to the west of the house which will provide a dining and informal sitting space for our family – a family room. The existing reception room to the right of the entrance door will be a more formal lounge as per its most recent use.
Creating a family kitchen / living space in this location will reinvigorate Sheldon House, bringing the kitchen to the heart of the home. By building a small extension to the west of the house, we can benefit from the footprint of the existing outbuildings, increasing the floor area of the house with minimal impact on its character and without obscuring its existing form. The outlook and aspect of the existing rooms will remain as existing.
The cellular form and hierarchy of the rooms in the existing house will still be very much perceptible; however, the new spaces will be relatively free-flowing. The utility room and homework area will be located within the new timber structure that will replace the existing timber garage. The utility room will sit at ground floor level with the homework area occupying a mezzanine level over.
It is proposed to plant a grass and wild flower blanket over the flat roof to the living / dining areas. This green roof will sit behind the existing stone garden wall.
6.4 Design, Form and Materiality
Other than increasing the area of the ground floor of the dwelling and improving the layout of the existing spaces, one of the primary aims of the proposals is to consolidate and make more coherent the design of the existing house. It is proposed that the new extension be designed in a sensitive and contemporary manner, appropriate to a ‘Gentleman’s residence’ within a Conservation Area.
As mentioned in section 3.2 the integrity of the existing tall garden wall was compromised by an unmanaged copper beech tree and a fundamental flaw in the design of the wall (too narrow, too high, shallow foundations). The wall is significant in Sheldon’s vision to create a grand house, separated from its farmyard. It also has a major part to play in sheltering the house from the prevailing wind from the south west. The new extension will tie back to the existing tall garden wall, strengthening it and ensuring its survival.
It is proposed to replace the garage with another timber and stone structure with a metal roof and incorporate the area utilised by the stone lean-tos into the new extension. The new extension will be linked to the house with a frameless glass link. The integrity of the recessed area from which the WC and the rear courtyard are both accessed will be retained. The tall garden wall will remain dominant and legible, punctured only by a set of elegant sliding doors.
The proposed extension is one room deep and sits over the footprint of the existing outbuildings and garage. The existing form of the house is clearly retained. The new living space creates a dialogue with the existing domestic courtyard area but is closed to the farmyard elevation other than a single access door. The timber section is raised off the ground, sitting over a stone wall. It is proposed that the timber be larch and the stone wall utilise salvaged stone from site. The pitched section of roof will be corrugated zinc. Two weathered steel panels face the farmyard, emerging from behind the wall reflecting the rural character of the site. Behind these panels sits a flat grass roof. Weathered steel is a material that changes and patinates over time, transforming through rich, autumnal orange colours before finally arriving at a beautiful dark brown-purple. Discreet elements of the cladding will incorporate delicate holes to allow evening light to dapple the interior of the space.
Fig 13. Left: Kew House, Percy + Co. Right: Reconstruction of the Szatmary Palace, MARP The extension is conceived as 3 elements - existing stone walls, slender timber framed glazing under a flat grass roof and a simple timber clad pitched roof volume replacing the existing garage of the same form and material.
The combination of traditional, salvaged materials and new, soft and contemporary materials will bring something special to this part of the conservation area. We do not believe that slavishly trying to recreate the design of the house albeit in a smaller form more appropriate to an extension is the correct response here - to create pastiche would be a wasted opportunity, not in line with the best conservation philosophy and not something that Sheldon himself would have believed in. He had ambition and we aspire to pay tribute to that in addition to improving and enhancing the house and the conservation area. Old and new are clearly but sensitively delineated.
The visual impact of the proposed extension is minimal - it nestles sensitively behind an existing wall, utilises existing footprints, reinterprets the form of the existing garage and reuses existing apertures into the farmyard and domestic courtyard.
6.5 Size, massing and space
The gross external area of the ground floor including domestic curtilage outbuildings currently stands at 221 sq m. The gross external area of the ground floor as proposed will be 238 sq m, just 7.5% larger. The useable space in and around the domestic curtilage is much improved with this design when compared to the existing.
The garden wall is to be retained as existing in extent and form, changed only with the insertion of new timber framed glass doors to the south elevation. The grass roofed extension nestles behind the garden wall. The overall mass of the extension is horizontal; however, verticality is achieved with the orientation of each piece of glass and the larch clad timber structure.
6.6 Privacy and amenity
Sheldon House is located away from the small cottages along the road of the hamlet - it is further west with its front facing the rear of Limetree Farm. The domestic curtilage is also surrounded by a gritstone wall and separated from the cottages by a row of copper beech, chestnut and beech trees. The proposed location of the extension is at the furthest point of the house from the road and therefore the hamlet cottages. It is also further down the hill. The relationship between the location (geographical / shelter etc) of the proposed extension and the rest of the hamlet will ensure minimal impact on setting and therefore privacy and amenity. The south-west corner of Sheldon House and the position of the tall garden wall provide the new living space with a great deal of privacy.
6.7 Sustainability
6.7.1 Social and cultural sustainability
We are a young family who intend to live in the house for many years to come. Our main aim is to bring Sheldon House Farm back into use as a family home in the 21st century thus contributing towards sustaining a living community within The Brund.
We intend to use local craftspeople to work on the house. In doing so we will be supporting the long tradition of craftsmanship in building that has been established in the Peak District. 6.7.2 Environmental sustainability
Sheldon House itself is currently damp inside and out due to overshadowing by the copper beech tree; cement pointing externally and plastering internally; and a lack of heating. It is our intention to repoint the facades with lime mortar, re-plaster internally with lime plaster, insulate the ground floor throughout and install central heating including underfloor heating to the ground floor. The removal of any cement based mortar from the building will protect the building fabric from damp allowing it to breathe into the future. We also propose the use of a renewable energy source by introducing 4 clean burning wood burning stoves into the house. The building fabric of the new extension will ensure minimal heat loss. In addition, we will be recycling stone in the elevations.
Constructive conservation is an inherently sustainable activity that makes use of the embodied energy that has already been consumed in the construction of a building. Modernising and reusing historic buildings also contributes to distinctiveness in the built environment, thus helping to create a better quality of life for present and future generations. (English Heritage / Historic England, 2013, p.3)
6.7.3 Economic sustainability
In the face of economic austerity and a shortage of housing particularly in a national park, upgrading and reusing existing buildings it is of great importance. What our family are proposing to do in this case is adapt what should be a family house but is not currently suitable for this use to the needs of modern life. The measures we take within the house to reduce energy consumption will in turn reduce running costs.
...there is a vast stock of unlisted 19th and 20th century buildings that quietly contributes to the character of our towns and cities. These buildings may be less architecturally significant than those that are listed, but they also offer greater scope for reuse and environmental upgrading. Making the best use of this excellent, if undervalued, resource means adapting these older buildings to the demands of modern use, balancing in the process a sensitive and informed appreciation of original fabric with an inventive approach to design. (Hines, accessed 2018)
In addition, in using local craftspeople to work alongside us in improving and enhancing the house and its environs we will be contributing towards the local economy.
The upkeep of the house, outbuildings and land is a large undertaking. The land allocated to Sheldon House prior to auction was unfortunately not enough to allow the property to be viable as a farming business. It is likely that in order to up keep the house and outbuildings we will need, at some point in the future, to let a bedroom or two in the rear wing of the house on a bed and breakfast basis. This will supplement our finances, contributing to the maintenance of the barns and land. 7.0 Planning Policy
7.1 National Planning Policy Framework
The NPPF requires that local planning policy is structured in such a way as to support developments that, respond to local character and history, and reflect the identity of local surroundings and materials, while not preventing or discouraging appropriate innovation (p.15), as well as being visually attractive as a result of good architecture.
The framework also states that local planning authorities should take into account the desirability of new development making a positive contribution to local character and distinctiveness (p.30).
The NPPF makes it clear that the impact of change to a heritage asset should be weighed up against the heritage value of the asset with great weight being given to the asset’s conservation. Sheldon House is not listed and although it is in a conservation area and has a fascinating social history, the proposed works to the dwelling can only be perceived to improve enhance the house and wider conservation area. In addition, the proposed extension is mainly visible only from the private area of the conservation area, viewable only by us.
7.2 Peak District National Park Authority (PDNPA) Core Strategy
The PDNPA Core Strategy 2011 document sets out a series of strategies that will enable its ‘Vision by 2026’ to be achieved by working towards creating,
- A conserved and enhanced Peak District, where the natural beauty and quality of its landscapes, its biodiversity, tranquillity, cultural heritage and the settlements within it continue to be valued for their diversity and richness.
- A welcoming Peak District, where people from all parts of our diverse society have the opportunity to visit, appreciate, understand and enjoy the National Park’s special qualities.
- A living, modern and innovative Peak District, that contributes positively to vibrant communities for both residents and people in neighbouring urban areas, and demonstrates a high quality of life whilst conserving and enhancing the special qualities of the National Park.
- A viable and thriving Peak District economy, that capitalises on its special qualities and promotes a strong sense of identity.
In terms of cultural heritage assets, the PDNPA Core Strategy document acknowledges that the National Planning Policy Framework states that,
Local Development Frameworks should set out a positive and proactive strategy for the conservation and enjoyment of the historic environment, taking into account the variations in type and distribution of heritage asset, as well as the contribution made by the historic environment by virtue of its influence on the character of the environment and an area’s sense of place. It states that planning authorities should recognise...the stimulus it can provide to inspire new development of imaginative and high-quality design. (PDNPA, 2001, 9.39) It also recognises that plans should include consideration of how best to conserve individual, groups or types of heritage assets that are most at risk of loss through neglect, decay or other threats (PDNPA, 2001, 9.39).
One of the ways in which cultural heritage can be conserved and enhanced is by
Encouraging the refurbishment and re-use of disused or underused buildings of architectural and historic importance to enhance their contribution to the historic character of the area ((PDNPA, 2001, 9.45)
Policy L3, Cultural heritage assets of archaeological, architectural, artistic or historic significance states that,
A. Development must conserve and where appropriate enhance or reveal the significance of archaeological, architectural, artistic or historic assets and their settings, including statutory designations and other heritage assets of international, national, regional or local importance or special interest;
The proposed refurbishment and extension at Sheldon House achieves these aims. It is a sensitive and high-quality design that has been developed following analysis of the existing dwelling and its setting. The form of the extension speaks to the vernacular whilst also utilising salvaged and locally referenced and sourced materials in a way that enhances their contribution to the historic character of the area. The design is contemporary, sensitive and understated, resonating with the point about being living, modern and innovative. As discussed in the English Heritage document Valuing Places - Good Practice in Conservation Areas, part of their Constructive Conservation series,
Every conservation area contains places which have changed. Often these changes are features of the character which we wish to protect; often, too, further changes have to be accommodated if we are to ensure such places have a viable and beneficial future. (English Heritage, 2011. p.2)
PDNPA Design Guide
As discussed in the PDNPA Design Guide, dwellings within the Peak District tend to be characterised by robustness, simplicity and horizontality of form (PDNPA, 2007, p.13). They were also generally south facing in order to benefit from light and solar gain. Our proposal is influenced by these principles – it will be robust in its materiality, simple in its form and design, emphasises the horizontality of the building and faces south. The location of the extension creates another room at the end of a series of cellular rooms, speaking to the way in which the house has evolved. The Design Guide states that it is preferable to find a design solution which reflects or reinterprets the local tradition and is also a product of our time (p16). Our aim is for the extension to work in harmony with the existing building. The simplicity of the form and the use of high quality materials, detailing and workmanship will ensure that the new element will complement rather than being identical to the existing building. The form and proportions of the extension have been heavily influenced by the PDNPA Design Guide but also take strong cues from the existing house and site. We hope that we will further be able to reinforce this at Sheldon House.
7.4 Peak District Landscape Strategy
As previously mentioned, The Brund, is located within the South West Peak District. In studying the Landscape Strategy for this area it is clear that the hamlet and particularly Sheldon House Farm (as its land slopes down to the river Manifold) falls somewhere within the Upland Pasture or Upper Valley Pasture category, taking characteristics from both these descriptions.
Upland Pastures.
This is an upland pastoral landscape with a traditional dispersed pattern of gritstone farmsteads of probable ancient origins. There are also localised village settlements. Permanent pasture is enclosed by drystone walls and some hedgerows. Trees are scattered along incised cloughs and around dispersed gritstone farmsteads. This is a very peaceful rural landscape with open views to surrounding higher ground. (PDNPA, 2009, p.16)
Upper Valley Pastures.
This is a settled pastoral valley landscape with scattered trees along hedgerows, around settlements and following streams. Fields of permanent pasture are divided by hedgerows and occasional drystone walls. This is a settled landscape with dispersed gritstone farmsteads with stone or clay tile roofs. Views along the valley and to surrounding hills are filtered through scattered trees. (PDNPA, 2009, p.18)
One of the objectives of the Landscape Strategy is to provide a framework from which to protect and manage the distinctive historic character of the landscapes through sustainable landscape management (p.25). In the upland pasture areas this manifests as a priority to protect historic field boundaries and historic settlement patterns whilst protecting or managing the diversity of pastoral farmland. In the upper valley pasture areas, the priority is to protect and diversify the historic network of boundaries and trees, and to encourage natural river processes to provide flood storage, amenity and biodiversity benefits (p.26).
This design and access statement is related purely to the proposed extension at Sheldon House. However, it should be mentioned that increasing biodiversity; protecting field boundaries (drystone walls and hedges); diversifying the network of trees; encouraging natural river processes are all of utmost importance to us and we intend to manage our small parcel of land in a way that will help achieve the PDNPA’s aims.
Both the Conservation Area Appraisal and the Landscape Strategy document mention the negative visual impact from powerlines within The Brund and the wider South West Peak. In the future, we would be looking to take these cables below ground, an aspiration that is shared with other homeowners in The Brund. 8.0 Conclusion
Our investigations have revealed that Sheldon House has evolved over time to suit the needs of each generation and the aspirations of the owner at that time. John Prince Sheldon brought it up to date in the 1880s and we would like to do the same thing now by conserving the essence of the house and allowing its story to be told. We intend to improve, repair and conserve the fabric of Sheldon House and hope to be granted the opportunity to create a flexible living environment for our growing family within this exceptional location.
Our proposals are modest, sensitively designed and enhance rather than adversely affecting the character of the building or the Conservation Area. All alterations respect the existing and original historic fabric, layout and hierarchy of the building.
We believe that our proposals result in a design response that is clear in representing a conservation philosophy that has integrity and authenticity at its heart. We aspire to create a sensitive approach to contemporary renovation and extension within this sensitive location. Our commitment to Sheldon House is positive both for the house and the conservation area.
9.0 Bibliography
Department for Communities and Local Government; National Planning Policy Framework; March 2012
English Heritage; Conservation Principles, Policies and Guidance for the Sustainable Management of the Historic Environment; 2008
English Heritage / Historic England, Constructive Conservation; Sustainable Growth for Historic Places; 2013
English Heritage; Valuing Places - Good Practice in Conservation Areas; 2013
Hines, Mark; Conservation in the Age of Sustainability; www.buildingconservation.com; accessed 30/01/2018
Peak District National Park Authority (PDNPA); Conservation Area: The Brund; date unknown.
PDNPA; Design Guide; 2007
PDNPA; Farmstead Character Statement; 2017
PDNPA; Landscape Strategy: 9. South West Peak; July 2009
PDNPA; Local Development Framework. Core Strategy Development Plan Document; October 2011 A Existing Drawings
Not to scale Sheldon House. THE BRUND. SK17 0HP Existing Cellar and Ground Floor Plans October 2017 1:100 | A3 Drawing no. 010
1. Gritstone walls
2. Timber framed sash windows with stone quoins
3. Staffordshire Blue plain clay tiles
4. Rotten timber framed garage with stone base
5. Stone building with tiled monopitched roof
6. Late 20C stained timber framed casement window
Sheldon House. THE BRUND. SK17 0HP Existing East and West Elevations with Section K-K October 2017 1:100 | A3 Drawing no. 040
01. Gritstone walls
02. Timber framed sash windows with stone quoin
03. Staffordshire Blue plain clay tiles
04. Rotten timber framed garage with stone base
05. Stone building with tiled monopitched roof
06. Late 20C stained timber framed casement window
07. Late 20C concrete porch and timber door
08. Cables
09. Timber gate
10. Frameless glass panes into stone mullions to light attic bedrooms
11. Soil vent pipe from external WC
12. High stone wall with stone coping over
Sheldon House. THE BRUND. SK17 0HP Existing North and South Elevations October 2017 1:100 | A3 Drawing no. 041
01. Gritstone walls
02. Timber framed sash windows with stone quoin
03. Staffordshire Blue plain clay tiles
04. Rotten timber framed garage with stone base
05. Late 20C stained timber framed casement window
06. Late 20C concrete porch and timber door
07. Timber gate
08. Soil vent pipe from external WC
09. Gate into domestic curtilage
10. Gate to farm track up to main road
Sheldon House. THE BRUND. SK17 0HP Existing West Elevation from Yard and Inc. Section L-L October 2017 1:100 | A3 Drawing no. 042 4. Rotten timber framed garage with stone base 5. Store building with tiled monopitched roof 9. Timber gate 11. Soil vent pipe from external WC 12. High stone wall with stone coping over 13. Door into farmyard from house 14. Gate into farmyard from track to main road 15. Door into WC 16. Door into farmyard Proposed Drawings
Not to scale
01. Existing concrete kerb to be removed and replaced with new stone wall and flat capping
02. Existing grassed area and stone wall to be retained
03. Existing paving to be retained. New planting along south facing elevation of house and extension
04. New stone path to front door utilising salvaged flagstones to match existing. New flower bed and lawn to either side of path.
05. Ground level along front elevation of house to be reduced to prevent internal damp and to provide level access to proposed glazed doors. Stone steps up to driveway.
06. 'Grass' to flat area of new extension roof.
07. Existing concrete kerb removed. New stone kerb to form new parking/turning area. Loose degraded tarmac to be replaced with new.
08. Existing farm yard access to be maintained but used infrequently and controlled for safety of children. New loose gravel surface to replace degraded tarmac.
09. Existing septic tank / cess pit to be emptied and infilled.
10. Existing degraded tarmac to be replaced with new loose gravel surface.
11. Stone sets to provide edge to different surface finishes
12. New steps down to existing path
13. Existing dangerous concrete structure to be removed
14. Existing tall farmyard / garden wall
15. Glazed link
16. Location of new biolocisc
Sheldon House. THE BRUND. SK17 0HP Proposed Site Plan January 2018 1:200 | A3 Drawing no. 005
01. New window opening with frameless flush glass infill into existing attic bedroom
02. New window opening with frameless flush glass infill into internal corridor
03. Existing tall garden wall retained
04. Green roof over living area
05. New timber clad pitched roof structure with stone base to replace existing timber clad pitched roof structure with stone base in same location
06. Existing concrete porch and door removed and replaced with new timber framed sash window
07. New timber clad pitched roof structure with stone base to replace existing timber clad pitched roof structure with stone base in same location
08. Existing concrete porch and door removed and replaced with new timber framed sash window
09. New timber framed glazed doors with sandstone quoins to replace double windows
10. Ground level reduced around corner of house to prevent further damp ingress
11. New sliding glass doors set within existing south facing wall
12. New frameless glass link within existing stone 'recess'
13. Existing rotten timber framed and clad building removed
Sheldon House. THE BRUND. SK17 0HP Proposed North and South Elevations October 2017 1:100 | A3 Drawing no. 056
01. New window opening with frameless flush glass infill into existing attic bedroom
02. New window opening with frameless flush glass infill into internal corridor
03. Existing tall garden wall retained
04. New timber clad pitched roof structure with stone base to replace existing timber clad pitched roof structure with stone base in same location
05. Existing concrete porch and door removed and replaced with new timber framed sash window
06. New frameless glass link within existing stone 'recess'
07. New timber framed glazed doors to replace modern stained timber casement window
08. Metal panels, perforated to allow light into interior
09. Existing rotten timber framed and clad building removed
10. Existing tall garden wall retained
11. Green roof over living area
12. New timber clad pitched roof structure with stone base to replace existing timber clad pitched roof structure with stone base in same location
13. New frameless glass link within existing stone 'recess'
14. Slim timber framed sliding glass doors into new living area
15. Existing rotten timber framed and clad building removed
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ad375c3fabf7a7eb110f9eb11e6fe689e7d9cb1c | Special Defect Report
Meadow Farm Crowdecote
On behalf of Mr. Stephen Campeau
Ref:0434 1 Introduction
1.1 Instruction/ remit This report has been prepared solely for the benefit of the named client. No liability is accepted to any third party. Where work has been carried out to the property in the past, the surveyor cannot warrant that this has been done in accordance with manufacturers’ recommendations, British and European Standards and Codes of Practice, Agreement Certificates and statutory regulations. This report assumes the property is to be sold with the benefit of vacant possession, with freehold tenure, on completion of the purchase. Your legal adviser should be able to confirm that there are no unusual or particularly onerous restrictions in relation to the property.
1.2 Limitations Comment cannot be given on areas that are covered, concealed or not otherwise readily visible. There may be detectable signs of concealed defects, in which case recommendations are made in the report. In the absence of any such evidence, it must be assumed in producing this report that such areas are free from defect. If greater assurance is required on these matters, it will be necessary to carry out exposure works. Unless these are carried out prior to exchange of contracts, there is a risk that additional defects and consequent repair costs will be discovered at a later date.
1.3 Description of property The property is a 19th century rural two storey barn with a latter addition of an extension to the left hand elevation. The inspection was carried out on the 28th. of February 2018.
1.4 Survey details My instructions were to inspect the property to gauge the condition of a number of cracks evident to the internal and external masonry of both external and partition walls and comment on their condition and whether there is any need for further investigation or remedial repair. 2 Investigation & analysis
2.1 Inspection The property is constructed of traditional build of solid rubble filled limestone walls of a thickness of 500mm both of coursed and random style construction with supporting gritstone lintels and quoins with some replacement concrete lintels at ground floor level. The two storey barn is 19 meters in length and 15 meters in width and based on this vernacular type of barn construction it is likely that it will be sat upon shallow stone footings (however, this can only be confirmed via a pit inspection). There are also three internal partition walls of the same construction with a solid concrete ground floor and a 1st floor constructed of none original traditional suspended timber floor formation. It was also evident that the original roof has been completely replaced (vendor informed me this was carried out four years ago) with a new traditional cut roof with main purlins supporting common rafters with a modern underfelt below traditional stone tiles.
There is evidence of internal cracking at 1st floor level where the end and internal partition walls abut the main side elevations and evidence of cracking of the left hand end elevation wall coming away from the main sides of the property. At ground floor level there is no evidence of any such cracking and many of the walls at this level have been rendered internally around 30 years ago. The cracking at 1st floor level is wider at the top of the wall and tapers downwards with no evidence of this cracking continuing to the ground floor.
These cracks differ in width with the majority of them under industry standard BRE Digest 251 guidelines coming under both Category 4 and 5 which stipulates major remedial structural repair is necessary.
4 - Extensive damage which requires breaking-out and replacing sections of walls, especially over doors and windows. Windows and door frames distorted, floor sloping noticeably. Walls leaning or bulging noticeably, some loss of bearing in beams. Service pipes disrupted. Typical crack widths are 15 to 25 mm, but also depends on number of cracks.
5 - Structural damage that requires a major repair job, involving partial or complete rebuilding. Beams lose bearing, walls lean badly and require shoring. Windows broken with distortion. Danger of instability. Typical crack widths are greater than 25 mm, but depends on number of cracks.
The cracks to the internal walls and end elevations are commonly caused by roof spread where the load is excessive and causes the roof structure to push down on the supporting walls causing deflection outwards. This is why the cracks are considerably wider at the top of the walls and why there is no evidence of any such movement at ground floor level. The crack to the left hand end elevation is also only at 1st. floor level and suggests that this latter extension to the main part of the building is rotating away outwards which could be due to weaker footings compared to the rest of the original building. Right hand internal partition wall Crack to this internal wall is over 25mm in thickness
Central partition wall BRE Category 4 crack to internal wall Again, a large crack to this wall of 20mm which tapers to nothing at the base of the 1st. floor Crack to rear wall at corner of left hand side elevation. Crack ranging from 20mm to 40mm in thickness No evidence of ongoing deflection of wall from newly inserted roof purlin
Evidence of roof spread deflection to left hand end elevation. No evidence of structural movement to the 30 year old render at ground floor level 2.2 Conclusions and recommendations
As the roof has been replaced and the fact that the 30 year old render at ground floor level shows no signs of movement I surmise this movement is historical in nature with the roof spread being caused by the original roof structure which has since been removed. The cracks to the end elevation of the left hand side extension also show no signs of any recent ongoing movement as the new purlins which enter the end wall to this area show no evidence of coming away from the masonry. However, based on the severity of the width of the cracks, structural stabilising work should be carried out by a qualified Helifix or PCA accredited contractor to stabilise these cracks prior to any refurbishment of the property, this commonly involves the installation of stainless steel support bars with the use of a resin compound but may also involve some partial wall rebuilding where the size of the cracks is considered to be of a severity that support bars alone are not considered enough of a repair. Evidence which suggests rotation of the left hand end elevation means that this also may involve some form of underpinning to the left hand side elevation.
In my experience quotes for such works can differ considerably from competing contractors. Therefore, it is advisable that you obtain a number of quotes for such work prior to undergoing the main conversion of the building to help you budget accordingly. It is also imperative that the contractors are familiar with this type of vernacular type of construction and based on the important nature of such structural stabilising it is imperative that the work is covered by a company and insurance backed guarantee. These are usually given to cover a period between 15 and 30 years.
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d66e2fcea5ae822483b531698c8d870174b526a3 | Planning, Design and Access Statement
For Agricultural Building, Silage Clamp, Slurry Tank and yard.
at
New Barn Farm, Aldwark, Matlock, Derbyshire, DE4 4HX
On behalf of
George Lomas
Prepared by: Fisher German LLP The Estates Office Norman Court Ashby de la Zouch LE65 2UZ
March 2018
## CONTENTS
| Section | Title | Page | |---------|--------------------------------------------|------| | 1.0 | INTRODUCTION | 1 | | 2.0 | BACKGROUND | 2 | | 3.0 | SITE AND SURROUNDING AREA | 4 | | 4.0 | PROPOSED DEVELOPMENT | 6 | | 5.0 | RELEVANT PLANNING POLICY | 9 | | 6.0 | ASSESSMENT | 13 | | 7.0 | CONCLUSION | 15 | 1.0 INTRODUCTION
1.1 This Planning, Design and Access Statement is submitted in support of an application for an agricultural building, silage clamp, slurry tank and yard at New Barn Farm, Aldwark, Matlock, Derbyshire. The submission forms part of a wider proposal for farm development and should be assessed in the context of the parallel Prior Notification application for farm tracks between New Barn Farm and the adjacent Aston Hill Farm, which, together with repairs to existing buildings at the Aston Hill Farm, will enable the applicant, George Lomas, to grow his organic dairy business as a third generation farmer.
1.2 The statement provides a commentary of the existing farm and the proposals to expand the business; a description of the site and context of the surrounding area; details of the proposal alongside an overview and assessment of the planning policy context relevant to the proposed development.
1.3 The application is supported by the following documentation:
- Application forms and application fee
- Location Plan (Drawing Number: 118673-002.5)
- Block Plans (Drawing Number: 118673-003)
- Floor plans and elevations of agricultural building (Drawing Number: 118673-004.2)
- Floor plans and elevations of silage clamp (Drawing Number: 118673-005)
- Floor plans and elevations of slurry tank (Drawing Number: 118673-006)
1.4 The statement concludes that the proposal complies with the Development Plan and National Planning Policy as appropriate farming development allowing an existing rural business to expand in a sustainable manner. It is therefore respectfully requested that the application is viewed favourably and approved without delay. 2.0 BACKGROUND
2.1 The applicant, George Lomas, and his family have farmed Aston Hill Farm for over 30 years with George being the third generation entering the business 5 years ago and setting up home at the adjacent New Barn Farm. Aston Hill Farm is operated under a Farm Business Tenancy and New Barn Farm is owned by the applicant. The farming operation totals 302 acres and moved to an organic dairy when George and his wife, Katie Lomas, took on the farm in 2013.
2.2 The business has a 20-year growth plan and is currently in Year 4. The existing organic dairy farm supplies OMSCO, the Organic Milk Suppliers Cooperative, which gives a guaranteed high return, maximising profit per litre of milk. There is growing demand for organic products and this gives certainty and stability to the farming business through OMSCO.
2.3 The farm currently has a milking herd of approximately 150 cows with 67 heifers and calves, giving around 217 head of cattle. The business plan is to increase the milking herd to 250 and to do this additional cattle housing for the winter months and ancillary development is required at New Barn Farm, which forms the basis of this planning application.
2.4 In addition to the buildings, the operation of the farm in terms of grazing, movement of cattle and significant reduction of feedstock is proposed. The new system will involve moving cattle between enclosed grazing areas on a rolling 24-hour programme. This gives the grass time to recover and gain good growth, and drastically reduces the amount of supplementary feed required due to the improved grass provision.
2.5 Key to this system is the construction of a track crossing centrally through the grazing land and providing access for the cattle to the individual paddocks. The track, detailed in the parallel Prior Notification application, will ensure that the cattle follow a single route and do not erode or poach other paddocks. The track will also enable the access through to the paddocks during spring and autumn months, when traditionally routes become heavily eroded and open grazing would have eradicated the fresh grass. The use of the track and the segregated grazing paddocks enables the grass to recover and continue to be grown for a much longer season. At present, open grazing of the farm enables cattle to be turned out between May and September; with the proposed paddock and track system, the open grazing can begin much earlier in March and follow through until mid December. 2.6 The environmental and economic benefits of the proposed system are substantial. At present the cattle are fed on around 5kg of corn per day. With the higher quality grass, which has time to recover in the proposed scheme, only 0.3kg of corn will be required to supplement the animals diet. In addition, the period of time that the cattle are outside will extend by up to 20 weeks further reducing the cost of food supplements. Equally, the time that the cattle are housed in the barns will reduce by the same period, bringing savings in bedding and labour.
2.7 The environmental benefits of the paddock grazing system stem from the controlled grazing and the ability of the grass to recover. The use of the central track through the farms will also steer the cattle off the grass and minimise unnecessary land erosion. The cultivation of the grass paddocks will not require ploughing as the existing grass cover will be supplemented by indigenous grasses through overseeding. The removal of the need to plough the land will avoid damage to soil structure and erosion. In more general terms, the need for bedding, corn supplements and intensive management when the cattle are no longer housed for an extended 20-week period will be reduced accordingly. This reduction of resources is a positive environmental gain.
2.8 The final element of the proposed development which will facilitate growth of the herd and expansion of the business is the repair and refurbishment of existing barns at Aston Hill Farm. These buildings would be converted to calving units and for rearing young stock. The track provides an important formal route between Aston Hill Farm and New Barn Farm where the main farm buildings are located, and where George lives with his family. The track will facilitate the movement of cattle between the farm buildings, avoiding transport of cattle, equipment and food/bedding on the public highway, which reduces conflict of slow moving farm traffic and general vehicles. 3.0 SITE AND SURROUNDING AREA
3.1 New Barn Farm and Aston Hill Farm are within the Peak District National Park and sit adjacent to one another lying 1 mile to the east of Pikehall and 6 miles south of Bakewell. The farms are to the south of the A5012. Aston Hill is the western farm and New Barn is situated to the east. The image below illustrated the general location of the farms.
Figure 1: General location of the Aston Hill Farm and New Barn Farm
Figure 2: Location of New Barn Farm 3.2 New Barn Farm is now the centre of the applicant’s organic dairy business with cattle sheds, a yard and parlour all recently constructed. The historic courtyard buildings are in need of repair and no longer fit for modern farming purposes, they are separated from the new farm buildings by a small tree copse.
3.3 Planning permission has been granted for a new farmhouse and this is due to commence construction this year, however at present the Lomas family are residing in a caravan on site. The land around the farm is used predominantly for grazing with stone walls dividing the land. Access to New Barn Farm is via an unclassified road spurring south off the A5012.
3.4 There are no known heritage, ecological or flood designations on the site of the proposed farm development. 4.0 PROPOSED DEVELOPMENT
4.1 The proposed development is for a new agricultural building, silage clamp, slurry tank and hardstanding area to be used as a farm yard. The Figure 4 below illustrates the proposal.
Use
4.2 The development proposed at New Barn Farm is for agricultural purposes to enable the expansion of the organic dairy farm. The buildings and structures are typical of modern farms being of a scale and mass similar to those already on site. The agricultural building would be used to house additional cattle with the silage clamp and slurry store providing additional ancillary capacity to facilitate the animals. The second yard would provide an additional handling area.
Layout
4.3 The proposed development is laid out to link to the existing farm yard and buildings. The cattle shed will open onto the existing yard on its eastern elevation. The silage clamp will also open on to the existing yard with access into the clamp from the north. The new yard will link directly through to the existing yard.
Figure 4: Proposed Development Amount, Scale and Appearance
4.4 The cattle shed would be 30m x 46m in size with a height of 8m to the ridge and 5.9m to the eaves. It would be constructed of concrete block panels on the lower section with Yorkshire boarding above. The roof would be profiled metal sheeting. Openings are proposed on the eastern elevation with gated entrances to allow the cattle to move through to the yard. Drawing No. 118673-004.2 shows the proposed agricultural building with an extract below in Figure 5.
4.5 The silage clamp would be a simple square enclosure, open on the northern side. The walls would be concrete block panels and it is proposed that the clamp would be separated into three bays, although the dividing panels would be movable. The clamp would cover a concrete hardstanding area of 30m x 30m with the walls 3m high.
4.6 The slurry store is an essential facility for the farm to ensure compliance with both agricultural and Environment Agency standards. The store would be a circular holding tank with no roof. The diameter of the tank would be just over 29m and the walls would be 5.67m high. The tank would be constructed of vitreous enamel coated sheeting and would have and an access ladder and platform. There would also be a lower level valve out pipe and a full height in pipe. Figure 6 below shows a similar storage tank although this has a greater number of access ladders.
**Access**
4.7 The farm buildings and structures at New Barn Farm will be accessed via a new track proposed as part of a parallel Prior Notification application. The Track would link the development to the highway and via a new internal track system to the adjacent Aston Hill Farm where young cattle will be raised. The track will adjoin the existing yard adjacent to the proposed silage clamp as shown in Figure 7 below.
 5.0 RELVANT PLANNING POLICY
5.1 Section 38(6) of the Planning and Compulsory Purchase Act 2004 requires applications for planning permission to be determined in accordance with the Development Plan unless material considerations indicate otherwise. In addition, Government policy, principally the National Planning Policy Framework published in March 2012 (the Framework), is material to the determination of planning applications.
5.2 The statutory Development Plan against which this application should be determined comprises:
- The Peak District National Park Core Strategy DPD, 2011.
- The saved policies of the Peak District National Park Local Plan, 2001.
5.3 The emerging Peak District National Park Development Management Policies Document does not yet form part of the statutory development plan; however, it is a material consideration in line with paragraph 216 of the NPPF. The emerging plan has been submitted to the Secretary of State and the Examination of the document will follow this summer.
Peak District National Park Core Strategy, 2011
5.4 The Core Strategy sets out the strategic policies for the Peak Park and underlines the importance of the national designation which identifies the Park as an area of natural beauty, wildlife and cultural heritage.
5.5 General Spatial Policy GSP1 reiterates the purposes of the National Park in securing sustainable development where it is consistent with the designation in terms of conserving and enhancing the valued characteristics and to promote opportunities for the understanding and enjoyment of the special qualities by the public.
5.6 Policy GSP2 requires the enhancement of the National Park through design that respects the character of the area.
5.7 Development management principles are set out in Policy GSP3, requiring all development to respect, conserve and enhance all valued characteristics of the site. In particular attention should be paid to:
- the character and setting of buildings
- a scale appropriate to the character and appearance of the Park
- the form and intensity of use 5.8 With regard to farm development, the Vision of the Core Strategy sets out to deliver “a viable and thriving economy” with a more detailed Spatial Objective to “Support agricultural businesses that conserve and enhance the valued characteristics of the landscape”. Development Strategy Policy DS1 states that agricultural development is acceptable in principle outside the Natural Zone, which this proposal is.
5.9 Policies LS1, LS2 and LS3 require development to conserve and enhance the landscape, biodiversity and heritage assets of the National Park respectively.
**Peak District National Park Local Plan, 2001**
5.10 The saved policies of the 2001 Local Plan relevant to this planning application are Policy LC4: Design, layout and landscaping and Policy LC13: Agricultural operational Development.
5.11 Where development is acceptable in Principle, Policy LC4 requires detailed treatment to be to the highest standards that respects, conserves and where possible enhances the characteristics of the area. In particular the scale, form, mass and relationship to existing buildings and the landscape; how the design and materials complement local buildings; and the use of the landscape.
5.12 New agricultural developments will be permitted by Policy LC13 subject to being close to existing buildings and making best use of landscape features; respecting the design, scale, mass and colour of existing buildings; avoid harm to the valued characteristics; and there being no requirement for excessive services.
**Peak District National Park Development Management Policies, Consultation Document October 2016**
5.13 The emerging Development Management Policies outline more detailed requirements for development. With regard to the proposed agricultural scheme at New Barn Farm the following policies are considered of relevance.
5.14 Policy DM1 states that there is a presumption in favour of sustainable development and that the National Park Authority will take a positive approach and will work proactively to find solutions in the context of conserving and enhancing the natural beauty of the area. 5.15 Policy DMC1 reiterates the conservation and enhancement of nationally significant landscapes, stating that development that does not respect, has an adverse impact or causes undesirable change to the landscape will not be permitted.
5.16 Where developments are acceptable in principle, Policy DM3 requires that design is to high standards and where possible enhances the natural beauty, quality and visual amenity of the landscape. The siting, mass, scale, height, design, building materials should all be appropriate to the context. Accessibility of the development should also be a key consideration.
5.17 Agricultural developments should be in accordance with Policy DME1, which confirms that such development will be permitted where it is demonstrated that the building is a scale, size, form, location, design and type that is functionally required for the farming operation. The buildings should be situated close to the farmstead, relate will to existing buildings and make use of landscape features. New buildings should respect the design, scale, mass and colour of existing buildings.
Supplementary Planning Guidance: Agricultural Developments in the Peak District National Park, 2003
5.18 The SPG relating to agricultural developments reflects adopted and emerging planning policy in terms of detailed design guidance and siting of new buildings. Whilst the guidance is now 15 years old, it is very much in line with Policy DME1 of the emerging Development Management Policies Document.
National Planning Policy Framework (2012)
5.19 The National Planning Policy Framework (NPPF) was published in March 2012 and provides over-arching guidelines for the planning system that replace all previous planning policy statements and planning policy guidance notes. The document states that ‘the purpose of planning is to help achieve sustainable development.’ The central theme of the framework is the introduction of a presumption in favour of sustainable development.
5.20 The principle of sustainable development is at the core of the planning system. The NPPF promotes sustainable development through economic, social and environmental objectives. Paragraph 9 outlines that sustainable development involves ‘seeking improvements in the quality of the built, natural and historic environment, as well as in people’s quality of life’. 5.21 Paragraph 14 of the NPPF outlines a presumption in favour of sustainable development. Proposed development which is in accordance with an up to date development plan should be approved, and proposed development which conflicts with it should be refused, unless material considerations indicate otherwise.
5.22 Paragraph 18 underlines the Government’s commitment to economic growth in order to create jobs and prosperity and Paragraph 28 gives more direction on the rural economy stating that planning authorities should take a positive approach to sustainable new development in rural areas. To create a strong rural economy agricultural development should be promoted.
5.23 Good design is promoted in Paragraphs 56 – 58 by using high standards in all development and Paragraph 115 places great weight to protecting the landscape and scenic beauty of National Parks. 6.0 ASSESSMENT
6.1 This proposal involves the erection of a farm building, sileage clamp, slurry tank and a new yard area. The assessment below considers the scheme against general development, agricultural and rural economic policy in the adopted Development Plan, emerging Development Management Policies document and the NPPF, examining firstly the principle and then the details of the proposal.
Principle of Agricultural Development
6.2 The proposed building, ancillary structures and yard at New Barn Farm are required for the existing agricultural business to grow in a sustainable manner that gives security to both direct and indirect employment, bringing investment to the rural area and delivering a development that conserves and respects its National Park setting.
6.3 New Barn Farm and the adjoining Aston Hill Farm are both established agricultural holdings. New Barn Farm is owned by the applicant, George Lomas, and is the centre of operations for the organic dairy business with existing cattle buildings, yard and parlour. It is also the location of the consented new farmhouse planned for construction this year. The applicant has a long-term farm tenancy covering the land and buildings at Aston Hill Farm and part of the business plan is to repair several buildings here to house calves and the land will be brought into the formal grazing system. The tracks proposed in the parallel Prior Notification application will link the two farmsteads together and implement the new cattle grazing system. The application site and neighbouring farm is therefore firmly established as an operating agricultural holding with clear future plans.
6.4 The proposed cattle shed has been shown as essential to providing winder housing for the larger milking herd. The increased number of animals will in turn require a greater sileage store and generate greater qualities of slurry. Both of these ancillary features are essential to the efficient operation of the dairy business, without which it could not meet animal welfare and the highest standard of farm practices. The new yard would provide complementary external space to the cattle shed for handling and treating the cattle, again this is an essential functional requirement. These factors show that the agricultural development is required in line with adopted Policy DS1, Saved Policy LC13 and Emerging Policy DME1. Importantly, the application site is outside the Natural Zone where development is more restricted. Furthermore, the development follows the Government objective in the NPPF supporting the rural economy and farming, as well as the Core Strategy Vision and Spatial objectives. Detailed Matters
6.5 In designing the scheme full regard has been paid to the careful siting of the development locating this immediately adjacent to the existing farmstead and reflecting the scale, massing, materials and overall design of the existing agricultural buildings. All of the proposed elements of the development have a functional relationship to the buildings and farm yard already in situ. Whilst being of modern functional farming design, they are not considered to pose an unacceptable visual impact on the setting of the existing farm or immediate surroundings and the development respects the character of the area. As such, the development is in accordance with adopted Policies GSP2 and GSP3, saved Policy LC13, emerging Policy DMC3, Paragraphs 56-58 of the NPPF and the National Park SPG on Agricultural Development.
6.6 Turning specifically to landscape impact and the protection and enhancement of the special character of the National Park, the proposal minimises intrusion through its collective siting with the existing farm buildings which take advantage of the naturally undulating landscape and areas of vegetation. The tree copse to the east of the farmstead gives some screening to the highway and a larger woodland area to the north west of Aston Hill Farm encloses views from the west. The rolling topography shields the proposed development from the north and to some degree from the south. Where it is visible, the structures will be seen in the context of the existing farm, blending in with the overall height, mass, form and colour. It is therefore considered that the development is consistent with the objectives of the National Park and in particular meets adopted Policy GSP2 and LS1, Saved Policy LC4, emerging Policy DMC1 and Paragraph 115 of the NPPF.
6.7 There are no wildlife, flood risk or heritage designations on the application site and it is not considered that the development would give rise to impacts on the surrounding area. Policies LS2 and LS3 or the Core Strategy are therefore complied with.
6.8 Taking the development as a whole and having regard to its context within the national park, it is submitted that the proposal meets the requirements of adopted Policy GSP1 and emerging Policy DM1 with a sustainable development that balances economic, social and environmental objectives set out in the NPPF without any overriding detrimental impact. 7.0 CONCLUSION
7.1 In planning terms, the key consideration of this planning application is whether the proposal accords with the Development Plan and whether material considerations add to or outweigh this position.
7.2 It has been demonstrated that the agricultural development at New Barn Farm is necessary to enable the further development of the organic dairy business and allow the applicant to take forward his expansion plans, which are sustainable in minimising harm and actively improving the natural environment, as well as securing the economic expansion for this third generation farmer.
7.3 The development has been designed to link to the existing farmstead using similar form, mass and materials. The site benefits from screening through the natural topography and mature trees in the immediate and wider vicinity. The impact on the landscape has been minimised and the wider benefits of the organic dairy farm, using the proposed grazing system will result in direct environmental benefits to the landscape and soil as well have being less demanding on resources.
7.4 Given that the planning application is in line with the Development Plan, emerging policy and the NPPF, it is respectfully requested that the proposed agricultural building, silage clamp, slurry tank and farm yard are granted planning consent.
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d2d21a7125d6a505d3a3adf21917b976009e5de5 | Global Financial Crisis Discussion Series
Paper 20: Tanzania Phase 2
H.B. Lunogelo, A. Mbilinyi and M. Hangi Global Financial Crisis Discussion Series Paper 20: Tanzania Phase 2
H.B. Lunogelo, A. Mbilinyi and M. Hangi
February 2010
Overseas Development Institute 111 Westminster Bridge Road London SE1 7JD www.odi.org.uk
1 This paper was funded by the Swedish Agency for International Development Cooperation (Sida) and is part of a wider research project coordinated by the Overseas Development Institute (ODI) London, but it does not necessarily reflect their views. Contents
Tables and figures iii Acronyms iv Abstract v
1. Introduction 1
2. Global financial crisis in Tanzania 2 2.1 Introduction 2 2.2 Trade 2 2.3 World commodity prices 4 2.4 Agriculture 5 2.5 Financial sector 5 2.6 Industrial sector 6 2.7 Tourism 6 2.8 Mining 9 2.9 Remittances and migration 9
3. Broad macroeconomic indicators 10 3.1 Introduction 10 3.2 Exchange rate movements 10 3.3 Inflation development 10 3.4 Fiscal operations 12 3.5 Money market 12 3.6 Equities 13 3.7 Investment and capital flows 13 3.8 Employment 14 3.9 Poverty status 15 3.10 Public and private debt 15
4. Policy responses and constraints 17 4.1 Strategic interventions at international and country level 17 4.2 Economic and social policies 17 4.3 Growth and development policies 18
5. Opportunities and way forward 20 5.1 Challenges 20 5.2 Opportunities 20 5.3 The way forward 20
References 22 Annex 1: Exports by type of commodity, Jul 2008-Jul 2009 23 Tables and figures
Table 1: Agricultural, mining and industrial sector export growth, 2007/08-2008/09 (%) 3 Table 2: Tanzania’s trade with EAC states, 2000-2009 (US$ millions) 3 Table 3: World commodity prices, year ending Jul 2007-2009 (US$) 5 Table 4: International tourism arrivals in Tanzania, Jan-Apr 2006-2009 7 Table 5: International tourism arrivals in Zanzibar, Jan-Mar 2007-2009 7 Table 6: Mining licenses granted for mining activities in Tanzania, 2007-2009 9 Table 7: Average prices for equities in the DSE, 2009Q2 and Q3 (TSh) 13 Table 8: Approved projects, 1996-Jul 2009 14 Table 9: External debt stock by borrower category Sep 2008/09-Sep 2009/10 15 Table 10: External debt stock by creditor category, 2007/08-Sep 2009/10 16
Figure 1: International tourism arrivals in Tanzania, Jan-Apr 2006-2009 8 Figure 2: International tourism arrivals in Zanzibar, Jan-Mar 2007-2009 8 Figure 3: Tourist arrivals through national entry points, 2007-2009 (’000s) 8 Figure 4: Inflation rates in Tanzania, Jan 2008-Jul 2009 (%) 11 Figure 5: Monthly oil prices, Aug-Dec 2008 11 | Acronyms | Description | |----------|-------------| | AfDB | African Development Bank | | BOT | Bank of Tanzania | | CRDB | Cooperative and Rural Development Bank | | COMESA | Common Market for Eastern and Southern African | | DOD | Disbursed Outstanding Debt | | DSE | Dar es Salaam Stock Exchange Market | | EAC | East African Community | | ESF | Exogenous Shocks Facility | | EWURA | Energy & Water Utilities Regulatory Authority | | FDI | Foreign Direct Investment | | fob | Free on Board | | GDP | Gross Domestic Product | | IMF | International Monetary Fund | | IOM | International Organization for Migration | | MDG | Millennium Development Goal | | NPL | Non-Performing Loan | | SADC | Southern African Development Community | | SDR | Special Drawing Rights | | TIC | Tanzania Investment Centre | | TTB | Tanzania Tourist Board | | UK | United Kingdom | | US | United States | | URT | United Republic of Tanzania | | USAID | US Agency for International Development | | VAT | Value Added Tax | | ZATI | Zanzibar Tourism Investors | Abstract
This paper examines the impact of the recent global financial crisis in Tanzania. It gives a snapshot view of the economic, financial and social effects of the current global economic downturn and summarises national policy responses to ensure that past economic achievements are not overturned.
At macro level, the crisis has reversed Tanzania's gross domestic product (GDP) growth projection from 8% to 5% for 2009/10. This has negative implications in terms of investment, employment and income for various actors in the economy. The banking sector started worrying that trade in finance was becoming increasingly more risky as export commodity prices continued to lose value in world markets, export orders reduced and tourism revenues dwindled.
Early in 2009, there were indications that the crisis had adversely affected a number of sectors, including agriculture, mining and tourism. By May 2009, the government estimated a loss of about $255 million in domestic income as a result of the crisis. By the third quarter of 2009, the financial sector was still sound, although some banks experienced an increase in non-performing loans and a decline in equity prices on the stock exchange and in foreign exchange inflow.
Trade suffered some setbacks: agricultural exports, minerals and gemstones and traditional and non-traditional crops recorded negative growth. However, trade in industrial goods recorded a positive trend, accounted for by the increase in trade between Tanzania and its neighbours in the East African Community (EAC). Manufactured goods, horticultural products and fish and fish products also recorded improved performance.
Some multinational companies have decided to close operations and hundreds of workers have been declared redundant as a result of the crisis. There was a decrease in foreign direct investment (FDI) projects (for 2009), and low employment creation from the registered projects, despite an increase in FDI value.
The Tanzanian government has come up with a number of policy responses to the global crisis, which has also provided some challenges and opportunities for the country. The challenges lie in Tanzania’s low domestic revenue generation capacity and productivity and weak infrastructure. Opportunities include the potential to diversify as a result of the country’s large natural resources base and the change to increase export income by expanding regional trade in the EAC.
1. Introduction
The global financial crisis has been referred as the worst since the Great Depression of the 1930s. It has contributed to the failure of key businesses, a decline in consumer wealth estimated at trillions of US dollars and a significant decline in economic activities, and has prompted substantial financial commitments by governments. The main factors behind the crisis were: extension of mortgage loans to borrowers at highly concessional terms; weak oversight and poor supervision of banks and financial institutions; and excessive relaxation of fundamental rules and regulatory requirements for financial institutions. These led to the accumulation of bad loans and business losses amounting to $2.3 trillion (or 17% of US gross domestic product (GDP)). Both market-based and regulatory solutions have been implemented or are under consideration, while significant risks remain for the world economy.
Economies worldwide started slowing down in late 2008 as credit tightened and international trade declined. Critics argued that credit rating agencies and investors failed to accurately price the risk involved with mortgage-related financial products, and that governments did not adjust their regulatory practices to address 21st century financial markets. Governments and c responded with an exceptional fiscal stimulus, monetary policy expansion and institutional bailouts (World Bank, 2009).
The effects of the crisis on developing countries have been forecast to be comparable with those on developed countries. In early 2009, the International Monetary Fund (IMF) downgraded its estimates and forecasts for sub-Saharan African growth by between 1% and 2%, to 5.5% for 2008 and 5.1% for 2009. By October 2009, the IMF was forecasting a deficit of 3% for sub-Saharan Africa, from a surplus of about 2.8% in 2008. This revision represented a reduction of up to $20 per head in sub-Saharan Africa as a result of the financial crisis.
The channels through which the global financial turmoil has affected developing countries have included financial channels and real channels. Financial channels include effects through stock markets, the banking sector (borrowing from advanced economies, foreign ownership of banks, exposure to the sub-prime market) and foreign direct investment (FDI). Real channels include effects through remittances, exports, imports, terms of trade and aid. Research based on current updates and forecasts, as well as evidence on what happened in previous slowdowns and in the absence of policy responses, suggested that net financial flows to developing countries may fall by as much as $300 billion in two years, equivalent to a 25% drop.
Before the global financial crisis, Tanzania's economy was projected to increase by 8% in 2009. Because of the crisis, economic growth is now projected to grow at 5% to 6% for 2009/10. By early 2009, there were already indications that the crisis had affected a number of sectors, including agriculture and tourism, thus adversely affecting growth projections. By May 2009, the Tanzanian government had estimated a loss of about $255 million in domestic income, and was calling for concerted efforts to boost agriculture and curb excessive spending through the import of expensive vehicles and the holding of unnecessary seminars. The financial crisis has also affected decisions to review the minimum wage for both public and private sector workers. 2. Global financial crisis in Tanzania
2.1 Introduction
2.1.1 First-round effects The country survived the first-round effects of the global financial crisis, which were characterised by a sudden credit crunch, or failure of financial markets to work. This was because Tanzania's financial markets traditionally have low levels of integration with international financial markets and operate under a regime of capital account restrictions. This lowered the country's exposure to bad financial assets, leading to lower exposure to the crisis. However, by late 2008 the banking sector started worrying that trade financing was becoming increasingly more risky as commodity prices continued to lose value in world markets and export orders reduced. One of the government's initial interventions was to assure the general public that the local banking sector was in a sound condition. It also started initiatives to support banks so that they would be able to avoid reductions in trade financing, as this would have greatly affected the national economy in terms of foreign exchange earnings and job creation.
2.1.2 Second-round effects Over time, the falling purchasing power of developed economies began to manifest itself in terms of a fall in commodity prices, loss of jobs leading to unemployment, a decline in incomes and a fall in demand for world tradable commodities. The most negatively affected sectors were agriculture, industry, mining and tourism (Mkulu, 2009). As the global economy continued to sink into depression, prices of key export commodities in Tanzania fell further. Consumer demand in advanced countries continued to decline and revenues from the tourism sector dwindled as people cut back on holidays. The government had managed to stay on track with regard to its promise to create a million jobs by 2010, but there were fears that the financial crisis was going to derail the process. The government therefore made concerted efforts to maximise the benefits from falling international crude oil prices to lower local prices and therefore reduce the cost of production and transport.
2.1.3 Signs of resilience in the financial sector The assessment early on by the Bank of Tanzania (BOT) that the domestic financial sector was in a sound condition, as a result of proper management and minimal direct exposure to international financial markets, has not been disputed by the facts on the ground. By the third quarter of 2009, the financial sector in Tanzania was still reporting growth and profitability. In terms of small banks, an after tax profit of approximately Tsh2.2 billion was recorded (compared with a profit level of approximately Tsh1.8 billion in the second quarter of the year). The same applied to bigger banks, which showed an increasing trend in after tax profit recorded. A combined profit of approximately Tsh50.6 billion was recorded in the third quarter, compared with Tsh29 billion in the second quarter.
2.2 Trade
However, despite the positive performance of the banking sector, the trade sector suffered some setbacks. Agricultural exports, minerals and gemstones, traditional crops and non-traditional crops recorded negative growth. However, trade in industrial goods recorded a positive trend, accounted for by the increase in regional trade between Tanzania and its East African Community (EAC) neighbours.
______________________________________________________________________
2 Commercial Bank of Africa, CF Union Bank, Tanzania Postal Bank, Mwanga Rural Community Bank, Habib Bank, Tanzania Women Bank and Kagera Farmers Cooperative Bank. 3 Standard Chartered Bank, CRDB Bank, Stanbic Tanzania, Citibank Tanzania, NBC Ltd, Diamond Trust Bank, National Microfinance Bank and Akiba Commercial Bank. Table 1: Agricultural, mining and industrial sector export growth, 2007/08-2008/09 (%)
| Sector | 2007/08 | 2008/09 | Change | |-------------------------------|---------|---------|--------| | Traditional crops | 15.8 | 15.6 | -0.2 | | Industrial goods | 15.3 | 24.6 | 9.3 | | Non-traditional goods | 27.0 | 22.8 | -4.2 | | Minerals and gemstones | 41.9 | 37.0 | -3.9 | | GDP growth | 7.1 | 5.0 | -2.1 |
Source: BOT data.
2.2.1 Regional trade: East African Community
From 2000, the trade balance between Kenya and Tanzania was negative (see Table 2). However, by 2008, the situation had started to improve marginally, from $-63.9 million in 2006 to $1.5 million in 2008. Tanzania reduced imports from Kenya to $113.7 in 2008 from $153.2 million in 2006; exports to Kenya increased to $115.2 million in 2008 from $89.3 million in 2006. This is explained partly by increased exports of staple foods and improved quality of products for the Kenyan market. At the same time, Tanzania continued to be a net exporter to Uganda, Rwanda and Burundi (BOT, 2009b).
Notwithstanding an increase in absolute exports to Kenya, Tanzania’s share of exports to Kenya slowed to 58.4% in 2008 from 77.6% in 2006. Meanwhile, export share to Burundi and Rwanda in 2008 went up significantly, from 3.1% and 2.4% to 24.0% and 6.5%, respectively. The increase in exports to Burundi was a result of increased exports of cereals and fertilisers. Tanzania holds a significant share of imports from Kenya, but this declined in 2008 to 94.0%, from 97.5% in 2007; import share from Uganda increased significantly over the same period, from 2.4% to 6.0%. The general picture from Table 2 is that Kenya and Tanzania dominate export and import trade in the region, and that the increase in trade in the region played a significant role in offsetting the decline in Tanzania’s exports to the world market. There remains a need to assess whether the crisis resulted in exceptionally increased trade between EAC states compared with their trade volumes and values in the rest of the world.
Table 2: Tanzania’s trade with EAC states, 2000-2009 (US$ millions)
| | 2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | 2009\* | |----------------------|-------|-------|-------|-------|-------|-------|-------|-------|-------|-------| | Tanzania’s trade with Kenya | | | | | | | | | | | | Exports to Kenya | 32.1 | 38.1 | 35.3 | 78.2 | 83.7 | 76.3 | 89.3 | 101.1 | 115.2 | 78.5 | | Imports from Kenya | 93.1 | 203.4 | 95.2 | 115.8 | 130.2 | 155.3 | 153.2 | 100.2 | 113.7 | 76.2 | | Trade balance | -61.0 | -165.3| -59.9 | -37.6 | -46.5 | -79.0 | -63.9 | 0.9 | 1.5 | 2.3 | | Tanzania’s trade with Uganda | | | | | | | | | | | | Exports to Uganda | 8.5 | 5.5 | 5.5 | 10.3 | 11.7 | 20.1 | 19.6 | 19.3 | 21.2 | 13.4 | | Imports from Uganda | 5.6 | 11.4 | 2.7 | 8.2 | 7.7 | 5.1 | 3.8 | 6.4 | 7.5 | 8.1 | | Trade balance | 2.9 | -5.9 | 2.8 | 2.1 | 4.0 | 15.0 | 15.8 | 12.9 | 13.7 | 5.3 | | Tanzania’s trade with Burundi | | | | | | | | | | | | Exports to Burundi | 4.2 | 6.1 | 7.0 | 4.7 | 7.5 | 7.3 | 3.5 | 41.5 | 44.8 | 27.3 | | Imports from Burundi | 0.0 | 0.2 | 0.0 | 0.3 | 0.0 | 0.3 | 0.0 | 0.0 | 0.4 | 0.2 | | Trade balance | 4.2 | 5.9 | 7.0 | 4.4 | 7.5 | 7.0 | 3.5 | 41.5 | 44.4 | 27.1 | | Tanzania’s trade with Rwanda | | | | | | | | | | | | Exports to Rwanda | 1.8 | 2.8 | 3.9 | 2.6 | 2.9 | 3.0 | 2.7 | 11.2 | 13.5 | 7.5 | | Imports from Rwanda | 0.1 | 0.1 | 0.0 | 0.1 | 0.1 | 0.0 | 0.2 | 0.0 | 0.3 | 0.1 | | Trade balance | 1.7 | 2.7 | 3.9 | 2.8 | 2.8 | 3.0 | 2.5 | 11.2 | 13.2 | 7.4 | | Total to EAC states | | | | | | | | | | | | Exports to EAC states| 46.6 | 52.0 | 51.7 | 95.8 | 105.8 | 106.7 | 115.1 | 173.1 | 175.2 | 98.6 | | Imports from EAC states| 98.8 | 215.1 | 97.9 | 125.1 | 138.0 | 160.7 | 157.2 | 106.6 | 116.6 | 76.3 | | Trade balance | -52.2 | -163.1| -46.2 | -29.3 | -32.2 | -54.0 | -42.1 | 66.5 | 58.6 | 22.3 |
Note: * = Unconfirmed data for Jan-Jul 2009. Source: BOT (2009b). 2.2.2 External sector development So far, external trade performance has been fairly satisfactory (Mkulu, 2009). Exports of goods and services increased by 3.2% during the period up to September 2009, and imports decreased by 4.4% in the same period. The current account deficit narrowed to $2060.7 million from a deficit of $2950.4 million recorded in the same period in 2008.
2.2.3 Export performance During the year ending September 2009, earnings from exports of goods amounted to $2671.7 million, equivalent to an increase of 7.9% compared with the same period in 2008. An improved performance was also recorded in manufactured goods, horticultural products and fish and fish products. The value of traditional exports went up by 32.2%, to $492.5 million from $372.4 million recorded in the corresponding period in 2008. This was because of an increase in export volumes of coffee, tobacco and cloves. With the exception of tea, tobacco and cashew nuts, which recorded an increase in export unit prices, other traditional exports recorded a decline in prices, mainly on account of the effects of the global financial crisis (see Annex 1). Earnings from non-traditional exports increased marginally, by 3.6%, largely because of an increase in exports of manufactured goods and horticultural products. There was remarkable performance in horticultural exports, associated mainly with expansion in horticultural production coupled with new investments in cut flowers in the southern part of Tanzania.
2.2.4 Imports During the first six months of 2009/10, imports of goods and services amounted to $6425 million, an increase of 11.6% over the previous year, much of it coming from imports of goods. Total goods imports increased by 10.9% to $5024.6 million during this period. Imports of capital and consumer goods rose by 29.0% and 6.9%, respectively, and imports of intermediate goods decreased by 3.4%.
2.3 World commodity prices Up to July 2009, world prices for agricultural and non-agricultural commodities recorded mixed trends. Prices of Robusta and Arabica coffee recorded a decline from $2.28 per kg in July 2008 to $1.87 in July 2009, and from $3.08 per kg to $2.17, respectively. The price of cotton (A Index) decreased from $1.64 per kg to $1.41 and the price of tea (average price and Mombasa Auction) rose from $2.36 per kg to $2.41 and $2.02 per kg to $2.24, respectively, the price of tea at the Mombasa Auction rising by 10.7% following strong demand from Russia, the Middle East and Pakistan. For cloves, the price declined slightly from $4164.58 per metric tonne to $3913.10, whereas the price of sisal increased from $1090.67 per metric tonne to $1213.00 in July 2009. On an annual basis, the price of Robusta coffee declined by 18% to $1.87 per kg. Similarly, the price of cotton (A Index and Memphis) declined to $1.41 per kg as a result of reduced global market demand. To July 2009, the average price of crude oil (Dubai fob and white petroleum products) recorded a notable decline, owing to an increase in crude oil stocks as a result of weak global demand occasioned by the financial turmoil. On the other hand, the price of gold rose slightly to $873.12 per troy ounce. These positive trends helped mitigate the effects of falling revenue from other export earnings, which declined as a result of falling world market prices. Table 3: World commodity prices, year ending Jul 2007-2009 (US$)
| Commodity | Unit | Year to Jul-07 | Year to Jul-08 | Year to Jul-09 | % change | |----------------------------|------|----------------|----------------|----------------|----------| | Robusta coffee | kg | 1.77 | 2.28 | 1.87 | -18.08 | | Arabica | kg | 2.60 | 3.08 | 2.17 | -13.54 | | Tea (average price) | kg | 1.90 | 2.36 | 2.41 | 2.30 | | Tea (Mombasa auction) | kg | 1.71 | 2.02 | 2.24 | 10.67 | | Cotton (Mombasa auction) | kg | 1.31 | 1.61 | 1.35 | -16.28 | | Cotton (A Index) | kg | 1.35 | 1.64 | 1.41 | -14.42 | | Sisal (UG) | MT | 931.67 | 1090.67 | 1213.00 | 11.22 | | Cloves | MT | 3662.13 | 4164.58 | 3913.10 | -6.04 | | Crude oil (avg UK Brent, Dubai, West Texas International) | Barrel | 62.8 | 99.28 | 63.07 | -36.47 | | Crude oil (Dubai fob) | Barrel | 61.21 | 95.44 | 62.14 | -34.89 | | White products (West Mediterranean fob) | Ton | 600.91 | 922.86 | 598.16 | -35.18 | | Jet/kerosene | Ton | 620.69 | 978.54 | 620.69 | -36.57 | | Premium gasoline | Ton | 613.12 | 860.78 | 575.08 | -33.19 | | Heat oil | Ton | 568.91 | 929.27 | 598.68 | -35.57 | | Gold | Troy ounce | 641.07 | 845.84 | 873.12 | 3.22 |
Source: BOT data.
2.4 Agriculture
Tanzania’s agricultural sector provides raw material to domestic processing industries and offers employment to about 70% of the population. The sector contributes about 45% of total export earnings, producing food crops including cereals, legumes and tubers, sugar, livestock and fish, mainly for the local market, and coffee, cotton, cashews nuts, tea, sisal, tobacco and horticultural crops.
Although most production is self-financed, marketing is funded largely by seasonal credits provided by banks to cooperatives and private companies. The crisis mostly affected borrowers engaged in marketing of cotton, coffee and tea. For instance, Cooperative and Rural Development Bank (CRDB) reported that TSh168 billion was at risk following persistent failure by traders to service their loans. Flower farmers also pleaded for a rescheduling of loan servicing following a decline in world market prices. Between October 2008 and March 2009, the world market price of horticultural crops, including flowers, declined by as much as 30% to 50% because of the economic downturn.
Demand in the world market for Tanzanian cotton products also declined, precipitating a domestic market crisis. International prices fell by 40%, leading to a pile-up of unsold cotton stock in warehouses. Cotton bought by traders at a high price from peasants suddenly lost its market. By April 2009, 124,344 bales of cotton were unsold out of 605,812 bales bought during the previous season; as a consequence business profitability and individual incomes declined.
Meanwhile, Tanzanian farmers were advised to take advantage of the crisis by diversifying and increasing their productivity in large production of food crops such as maize, paddy, cassava, wheat, legumes, grams, millet, sweet potatoes, bananas, Irish potatoes, beef, milk, chicken, fish, oilseeds, fruits and vegetables, so as to ensure food security for the country and open up massive opportunity to export food to address expected food shortages in the world.
2.5 Financial sector
The financial crisis has revealed the power of globalisation and how the world economy is interlinked. Globalisation can take a problem from one corner of the globe to multiple destinations, Tanzania included. Fortunately, financial indicators for Tanzania indicate that the market has managed to weather the storm relatively well (BOT data, November 2009). Lending to the private sector, for example, grew by 26.6% during the year to September 2009. Other key indicators for the financial sector show that:
- The average capital adequacy ratio was 19.3%, against a benchmark of 10%.
- All banks had adequate liquidity, with a liquidity ratio at 48.5% compared with a flow of 20%.
- The gross non-performing loan (NPLs) ratio was equivalent to 6.8%, compared with the international lower standard of 10%.
- The interbank payments and settlements system continued to be liquid and efficient.
- The interbank cash market continued to be liquid and characterised by stability interest rates.
Despite the encouraging financial indicators above, some financial institutions during the period experienced an increase in their NPLs, leading to a decline in their profitability. To cushion it from negative effects, Tanzania was earmarked for support under the Global Trade Liquidity Programme, started in March 2009. Stanbic Bank Tanzania and Standard Chartered are local beneficiaries of the initiative, and are expected to get support of up to $50 billion of trade. Other financial houses, such as Exim Bank and Access Bank, have also received special grants, from India and the African Development Bank (AfDB), to help cushion the effects of the crisis by extending special credit to agriculture, value addition and other businesses.
### 2.6 Industrial sector
Tanzania’s industrial sector is dominated by agro-based industries such as textiles and clothing, which are heavily dependent on the local market. Products from this industry have been affected by the financial crisis, as evidenced by reduced export revenues by factories such as SunFlag and 21st Century, which started reporting reduced export orders in November 2008. Other factories, such as Tabora, Mbeya and Kilitex, could not export their products owing to a loss of markets.
Provision of subsidies by some Far Eastern countries to their local industries caused some distortions in world market prices, such that Tanzanian local industry could not compete, not only internationally but also in the domestic market, following a flooding in of cheap garment imports from these countries. This has affected the profitability of local textile industries and their ability to create jobs and retain workers.
Livestock products have not been spared the effects of the global financial crisis. Tanzania is the leading country in the Southern African Development Community (SADC) and the third country in Africa with regard to livestock, whose products include leather. The leather industry in Tanzania has been affected by the crisis: between September 2008 and July 2009, prices of different types of livestock leather declined, from $1500 to $500 per ton for salt leather and from $1100 to $350 per ton for ghafi leather.
### 2.7 Tourism
In Tanzania, tourism is among the fastest growing sectors, contributing about 16% of the country’s GDP and about 25% of foreign exchange earnings. Most of the income generated is from the country’s 15 national parks, which were expected to receive 500,881 visitors between July and December 2008 but instead recorded only 425,137 visitors, including climbers. The 15% shortfall could be attributed to the recent decline in the number of external visitors to the country. Overall, tourism generated Tsh41.6 billion in 2008, less than the anticipated revenue of at least Tsh49.9 billion. Preliminary findings of a taskforce formed by the Tanzania Tourism Board (TTB) to strategise on mitigation measures showed a reduction in the number of visitors from two of its primary market hubs, namely the US and Europe, which together accounted for approximately 80% of the country’s visitors. The government responded by working closely with the TTB and the private sector in promoting Tanzania as a tourist destination. This included marketing tourist attractions in overseas media and urging industrial operators to improve their services and promote domestic tourism. As a result, the number of domestic tourists increased from 536,341 in 2007/08 to 637,749 in 2008/09. These steps resulted in overall collections from the sector surpassing the target set in 2008/09, ultimately receiving TSh1.8 billion in license fees from 468 firms in 11 months (Ministry of Tourism and Natural Resources data).
Data show a 10% decline in the number of tourists to the Tanzanian mainland, which registered 214,733 arrivals in January-April 2009 compared with 238,139 in the same period in 2008. Figure 1 shows international tourism arrivals in January-April for 2006-2009. Revenue obtained from tourism went down to $302.1 million in January-April 2009 compared with $388.2 million in 2008.
Likewise, in Zanzibar there was a decline of 10.4% in tourist arrivals in 2008 compared with 2007. However, there were some indications of improvements by February 2009, despite fears among hotel owners that the decline would persist in 2009. A research by Zanzibar tourist investors (ZATI) shows that that an estimated decline in the number of tourists by at least 15% would affect employment by 20% to 30%. Figure 2 shows tourist arrivals in Zanzibar for January-March of 2006-2009.
Table 4: International tourism arrivals in Tanzania, Jan-Apr 2006-2009
| | 2006 | 2007 | 2008 | 2009 | |-------|------|------|------|------| | Jan | 59,673 | 59,572 | 65,760 | 62,020 | | Feb | 49,223 | 51,563 | 65,426 | 61,713 | | Mar | 52,110 | 52,932 | 64,979 | 48,752 | | Apr | 39,719 | 52,690 | 58,950 | 58,763 |
Source: Ministry of Tourism and Natural Resources data.
Table 5: International tourism arrivals in Zanzibar, Jan-Mar 2007-2009
| | 2007 | 2008 | 2009 | Difference | |-------|------|------|------|------------| | | 2008-2007 | 2009-2008 | | Jan | 14,942 | 16,228 | 13,226 | 1286 | -3002 | | Feb | 13,289 | 14,323 | 14,884 | 1034 | 561 | | Mar | 11,580 | 12,045 | 10,577 | 465 | -1468 | | Apr | 6,323 | 4,542 | -1781 | | May | 4,076 | 4,275 | 199 | | Jun | 6,990 | 6,429 | -561 | | Jul | 13,640 | 13,283 | -357 | | Aug | 19,870 | 13,907 | -5963 | | Sep | 11,727 | 10,398 | -1329 | | Oct | 13,408 | 7,790 | -5618 | | Nov | 11,374 | 9,385 | -1989 | | Dec | 16,064 | 15,835 | -229 | | Total | 143,283 | 128,440 | -14,843 |
Source: Zanzibar Tourist Commission data. Figure 1: International tourism arrivals in Tanzania, Jan-Apr 2006-2009
Source: Ministry of Tourism and Natural Resources data.
Figure 2: International tourism arrivals in Zanzibar, Jan-Mar 2007-2009
Source: Ministry of Tourism and Natural Resources data.
Figure 3: Tourist arrivals through national entry points, 2007-2009 (‘000s)
Note: Julius Nyerere International Airport, Kilimanjaro International Airport, Zanzibar International Airport and Namanga border. Source: URT (2009c). 2.8 Mining
World market prices for mining also went down as a result of the crisis. In Tanzania, minerals most affected were diamonds, tanzanite, nickel and aluminium. Gold was not affected since it was used by nations as an alternative for currency value stabilisation following the depreciation of the major currencies (euro, US dollar and pound sterling). The decline in nickel prices caused Barrick and Xstrata to postpone their plans for Kabanga nickel mine until prices improve to avoid further losses to this project worth $165 million. Mining of aluminium was also expected to see a decline in revenue as a result of world market price falls. The impact of the crisis was most severe for tanzanite mining companies and small-scale miners, given a 50% decline in the price of tanzanite in the world market. Consequently, income and employment of small-scale miners declined, as well as that of other indirect earners: it has been shown that for every miner there are three people employed to provide food and other services. The price of diamonds was also affected, recording a decrease of 26%, from $8870 per carat in September 2008 to $6608 per carat in April 2009.
Investments in the mining sector in Tanzania are expected to decrease by more than 50%, from $90 million to $40 million per year, as indicated by a decline in requests for mining licenses: in April 2009 only 15 licenses were granted compared with 2008 (224 licenses). However, the sector seems now to be picking up as a result of strengthened prices of mineral commodities (URT, 2009c).
| Table 6: Mining licenses granted for mining activities in Tanzania, 2007-2009 | |---------------------------------|--------|--------|--------| | Prospecting licenses with reconnaissance | 155 | 224 | 15 | | Prospecting licenses | 607 | 1169 | 72 | | Special mining licenses | 1 | 0 | 0 | | Mining licenses | 28 | 69 | 9 | | Primary mining licenses | 1863 | 3573 | 678 |
Source: URT (2009c).
2.9 Remittances and migration
The global crisis is likely to have impacted not only export earnings but also remittances. The most direct short-term impact on the economy is likely to be declining funds from Tanzanians living abroad whose incomes have been affected (loss of jobs, reduced income and/or reduced dividends from investments made in real estate and financial markets). The BOT has reported some indication of reduced personal remittances, but hard data on the subject will not be available until special research by the Policy and Research Directorate is completed. However, a recent study by the International Organization for Migration (IOM) has indicated reduced remittances between Tanzania and Uganda, (data up to July 2009 only). Banks such as CRDB and the Commercial Bank of Africa, however, have reported a surge in interest by the diaspora in investing in ‘safe’ and high dividend projects in Tanzania, citing increasing default by friends and relatives when they send money home. CRDB had opened special accounts for 500 people and 300 clients in the UK and US in response to this demand. 3. Broad macroeconomic indicators
3.1 Introduction
Tanzania’s economic policies continue to centre on sustaining macroeconomic stability through measures to support strong economic growth. They entail maintaining fiscal stability via both revenue mobilisation and prudent expenditure management and controlling the money supply to meet inflation and economic growth targets, as well as maintaining an adequate level of foreign exchange reserves. Combined with policies to support private sector-led development and promote exports, these policies have enabled Tanzania’s GDP to grow by an average of 7.2% annually over the past five years. Despite the global financial crisis and economic recession, GDP growth in 2009/10 is officially estimated at 5.4%. However, inflation has been accelerating since 2006 and averaged 11.3% in 2009. As a result, the BOT revised its medium-term inflation objective upward in 2008 from 5% to 7%. The main short-run challenge facing planners, therefore, is to reduce the current double-digit inflation rate to single-digit levels. In the medium term, alleviating critical infrastructure constraints in transport, communications and energy sectors; putting in place measures to mitigate the impact of the global economic downturn; and establishing a mechanism to translate economic growth into broad-based poverty reduction are crucial. Restoring the credibility of the government in fighting corruption is also important in the face of several recently unearthed high-level scandals.
Tanzania’s foreign reserve holds more than $2.6 billion, enough to finance more than 4 months of goods and services imports. Moreover, foreign exchange-denominated deposits held with commercial banks by Tanzanian residents remains stable, at $1.5 billion, equivalent to another 2 months of imports of goods and services. Foreign exchange-denominated assets held by commercial banks add another half a month to this stock. In total, the country has reserves enough to last 6.5 months.
3.2 Exchange rate movements
Despite financial market robustness in the country, speculative demand for foreign exchange existed in the market after October 2008, driven partially by anxiety about foreign exchange availability in light of the crisis (BOT, 2009c). The BOT responded by intervening in the market to stabilise the value of the Tanzanian shilling. Despite this, its value depreciated by 12.9% by September 2009, to an average of Tsh1308.9, from Tsh1159.5 in September 2008. This fall was attributed to increased demand for foreign exchange in 2009, partly because of speculative gains and partly because of reduced foreign earnings relative to import requirement demand. However, the value of the Tanzanian shilling has been maintained within a narrow band against the US dollar in line with the sustained supply of foreign currency in the market by the BOT. The annual exchange rate averaged Tsh1317.4 per US dollar in 2009, compared with an annual average of Tsh1195.8 per US dollar in 2008, a depreciation of 10.2%.
3.3 Inflation development
The economy continued to experience inflationary pressures originating from the lagged effects of soaring world oil prices in 2007 and 2008, compounded by severe food supply shocks in the region and poor short rains in some areas of Tanzania in the first half of 2009. Annual inflation reached a peak of 13.5% in December 2008, driven by food inflation of 18.6%. Non-food inflation was at 6.0%. By the end of July 2009, annual headline inflation had continued to decline to 10.9%, from 12.9% in January 2009, when annual non-food inflation was only 1.9% but annual food inflation was 16.9%.
The headline inflation rate was expected to decline further before the end of 2009, owing to easing global fuel prices as well as sustained prudent fiscal and monetary policies in country. In August 2009, the annual headline inflation rate had increased to 12% compared with 11.3% and 10.9% in May and July 2009, respectively. This was attributed mainly to the increase in food inflation from 16.9% registered in the year ending July 2009 to 18.9% in the year ending August 2009. Food items that contributed to such price increases were cereals, cassava, potatoes, cooking bananas, fruits, fish, coconut and milk. The non-food inflation rate had also increased by August 2009, by 0.9%, including through fuel and fares. Inflation for the period is shown in Figure 4.
**Figure 4: Inflation rates in Tanzania, Jan 2008-Jul 2009 (%)**
*Source: BOT data.*
During the period, headline inflation was influenced by increased food costs but moderated by the easing of global fuel prices as well as sustained prudent fiscal and monetary policies pursued by the government for 2009/10. The fall in the price of fuel in the world market was among the positive effects that assisted in lowering production costs in many sectors of the economy. The translation of lower global prices to reduced domestic prices was made possible through a consensus campaign between the Energy & Water Utilities Regulatory Authority (EWURA) and fuel importers retailers. Figure 5 indicates monthly oil prices in the world market up to December 2008.
**Figure 5: Monthly oil prices, Aug-Dec 2008**
*Source: BOT data.* 3.4 Fiscal operations
The crisis has had some impacts on revenue sources, with shortfalls in taxes on imports and income. During the first three quarters of 2009, there was lower performance on domestic revenue against targets, even though overall foreign inflows were in line with budget estimates. Tax revenue collection was 11.4% of GDP compared with 10.8% during the corresponding period in 2008. Total revenue collection was 91.5% of budget projections. Good performance was recorded in taxes on local goods, whereby revenue collection was 21.6% higher compared with the corresponding period of 2007/08. The government continued to reform the tax system to modernise, broaden and enhance domestic revenue collection, even though its expenditure during 2008/09 was below budget estimates. Recurrent expenditure was 94.6% of estimates and development expenditure 74.5%. Total government expenditure during 2008/09 was 17.3% of GDP, out of which recurrent expenditure was 11.7%.
In early 2009, the government formed a taskforce chaired by the Governor of the BOT to evaluate the situation and propose mitigation strategies. The taskforce reported in mid-2009 that the crisis had led to reduced production capacity and job cuts in different sectors. The government set aside Tsh1.7 trillion (about $1.3 billion) as an economic stimulus package, among which over Tsh200 billion ($152.67 million) was set aside to aid local banks in separate programmes on credit financing to traders, cooperative societies and large-scale farmers who were falling behind on loan repayments during 2009/10. Although the country will get an additional $220 million as part of the fiscal stimulus package from the G-20 to fight off the crisis, this amount, which has been injected into the 2009/10 national budget, is equivalent to 1% of the country’s GDP.
3.5 Money market
3.5.1 Interest rate Tanzania’s money market generally remained healthy, although a few negative effects have been noted. As noted earlier, money markets fared well as a result of BOT interventions to help banks have more liquidity, whereby the interbank overnight rate was on average 1% and that of weighted average treasury bills ranged between 4.7%, 5% and 6%. Tanzania is now reviewing its investment rules, as it wants to open up room for foreign subjects to invest in treasury bills.
3.5.2 Bank deposits Likewise, the crisis has had little impact on bank operations, although some major banks were vulnerable, being directly in the line of fire by virtue of their link to shrinking global trade. However, the system had low exposure because it had a limited amount of foreign borrowing and no securities of international banks affected by the crisis. Low integration with international capital and financial markets is manifested in the level of foreign assets in the commercial bank system (11% of total assets). Another stabilising factor is that ‘foreign’ commercial banks are licensed, regulated and supervised under Tanzanian law, and do not operate as branches of parent banks abroad but as independent subsidiaries. However, the crisis affected their deposits overseas, which showed a slight decline during the period, with some banks recording a decline in deposits of between 3% and 12%. The banks have been warned that NPLs are likely to increase if the economy slows down and international commodity prices and demand for traditional exports continue to fall.
Overall, the banks seem to be doing well. On a yearly basis, the overall financial accounts of all banks showed pre-tax profits at Tsh84 billion ($64.61 million) during the year to 30 June 2009. This is a slight increase on the Tsh81 billion ($62.30 million) recorded in the year to 30 June 2008 (BOT data). Despite this, the BOT intensified supervision of banks and other financial institutions.
However, according to the IMF, Tanzania’s financial system is still not safe. In its country report for June 2009, the Fund called for vigilance and closer scrutiny of the local financial sector, warning that local banks were not out of the woods yet. It urged the Tanzanian government to safeguard pension funds, whose assets in banking institutions could be eroded by the crisis. There is fear about rapidly growing and inadequately supervised pension funds, which could be affected by deterioration in the quality of their assets and weak regulation of pension funds. The IMF pointed out that urgent action was required to put in place a regulatory authority, whose law was enacted in November 2009.
3.6 Equities
In the third quarter of 2009, the financial market continued to experience a fall in the price of some equities. As in the first quarter, shares of many companies declined. Quarterly average price changes are in Table 7.
Table 7: Average prices for equities in the DSE, 2009Q2 and Q3 (TSh)
| Company | 2009Q2 | 2009Q3 | % change | |----------------------------------------------|--------|--------|----------| | Tanzania Cigarette Company (TCC) | 1740 | 1740 | 0.0 | | Tanzania Portland Cement Company Ltd (TWIGA) | 1540 | 1640 | 6.5 | | National Microfinance Bank (NMB) | 740 | 790 | 6.8 | | Tanzania Tea Packers Ltd (TATEPA) | 495 | 490 | -1.01 | | Tanga Cement Company Ltd (SIMBA) | 1820 | 1820 | 0.0 | | National Investment Company Ltd (NICOL) | 285 | 270 | -5.3 | | Cooperative Rural Development Bank Ltd (CRDB)| 195 | 168 | -13.8 | | Kenya Commercial Bank (KCB) | 440 | 440 | 0.00 | | Tanzania Breweries Ltd (TBL) | 1800 | 1780 | -1.1 | | Swissport Tanzania Ltd (SWISSPORT) | 580 | 580 | 0.00 |
Source: DSE data (see [http://www.dse.co.tz/main/index.php?rec=main&page=9](http://www.dse.co.tz/main/index.php?rec=main&page=9)).
Notwithstanding the negative changes, shares of East African Breweries, Swissport Tanzania and Kenya Airways remained the same over the period. Nevertheless, the Dar es Salaam Stock Exchange Market (DSE) recorded a total turnover of Tsh23.07 billion during the third quarter of 2009, an increase of 228% on the second quarter (which ended on 30 June 2009), which generated Tsh7.04 billion. A total of 77.34.5 million shares were traded in the third quarter of 2009 compared to 18.53 million in the second quarter. This implies a rather healthy market, despite falls in share values of some companies.
3.7 Investment and capital flows
Some of the multinational companies in agriculture, mining and energy have decided to close operations and lay off workers as a result of the economic slowdown. As noted elsewhere, some have postponed investment in new projects. The government has intensified surveillance of the domestic, international capital and financial markets by setting up an early warning system using selected indicators of financial sector performance on a daily basis to determine signs of weakness. It has also established intensified oversight of the banking system and broadened information collection on bank performance, ensuring the capacity of the BOT and the government to intervene.
The government is looking into enhancing export incentives for investors, especially in priority sectors of the economy. The Tanzania Investment Centre (TIC) saw shrinkage of about 30% in the value of new investments in the first half of 2009 compared with the same period in 2008. The UK is a major source of investment in Tanzania in terms of number and value of projects, followed by Kenya, South Africa and India. TIC data indicate that Tanzania received $695.5 million in FDI in 2008 compared with $653 million in 2007, an increase of 6.4%. In 2008, the TIC approved 871 projects, with employment potential of 109,521 jobs, compared with 701 projects with employment potential of 103,958 jobs in 2007. Out of these approved projects, 621 were new and 250 were either for rehabilitation or extension. Table 8: Approved projects, 1996-Jul 2009
| Year | Approved projects | Local projects | Foreign projects | Joint ventures | Total employment | FDI value (US$m) | Growth rate (%) | |------|------------------|----------------|-----------------|---------------|-----------------|----------------|----------------| | 1996 | 111 | 49 | 17 | 45 | 19,745 | 148.64 | 6.2 | | 1997 | 199 | 90 | 53 | 56 | 37,311 | 157.8 | 9.1 | | 1998 | 213 | 111 | 46 | 56 | 35,010 | 172.2 | 9.12 | | 1999 | 181 | 81 | 43 | 57 | 12,933 | 517.7 | 200.6 | | 2000 | 1624 | 745 | 343 | 536 | 241,250 | 463.4 | -10.5 | | 2001 | 220 | 87 | 53 | 80 | 24,699 | 467.2 | 0.82 | | 2002 | 311 | 126 | 104 | 81 | 33,132 | 387.6 | -20.5 | | 2003 | 372 | 155 | 109 | 108 | 198,458 | 308.2 | 7.3 | | 2004 | 454 | 208 | 119 | 127 | 55,057 | 330.6 | 7.3 | | 2005 | 550 | 281 | 131 | 138 | 55,663 | 447.6 | 35.4 | | 2006 | 679 | 345 | 161 | 173 | 74,946 | 616.6 | 6.0 | | 2007 | 701 | 376 | 147 | 178 | 103,958 | 653.4 | 6.0 | | 2008 | 871 | 450 | 208 | 213 | 109,521 | 695.5 | 6.4 | | 2009 | 364 | 204 | 69 | 91 | 39,883 | 1875.93 | - |
Source: TIC data (www.tic.gov.tz).
In terms of ownership, 450 projects were local, 208 foreign and 213 joint ventures. Investments also grew, by 24.3% in 2008 compared with 3.2% in 2007. This was attributed to the increase in investments by local investors, especially in tourism (tour operations) and commercial buildings, and a general improvement in the investment climate. Sectors that attracted more investors in 2008 were tourism (268 projects), manufacturing (221), commercial buildings (141) and transportation (93). These sectors attracted more investors because of easy marketability of the products/services provided. In terms of regional distribution, Dar es Salaam, Arusha and Mwanza attracted most investors.
A $3.5 billion investment in aluminium smelting, a $165 million nickel mining project and a Canadian company set to invest in telecoms are among the victims of the crisis. A Swedish company, SEKAB, which leased 40,000 hectares of land in Bagamoyo and invested $250 million in efforts to produce ethanol has also decided to scale down the project. A number of commercial banks have also announced losses after their borrowers failed to repay their loans as a result of a decline in demand for commodities and a fall in prices in world markets. However, the flow of new investments was stable in 2008 because most source countries have traditional economic relationships with Tanzania.
3.8 Employment
The actual employment effects of the crisis are yet to be determined in Tanzania, but the information available indicates that a number of sectors have been negatively affected. These include mining, agriculture and tourism. Following the crisis, some multinational companies decided either to close their businesses operations or to scale down their business investments.
A bio-energy company based in Rufiji and Kilwa towns in eastern Tanzania is also cutting down on employees and selling its production facilities in some European countries. Kabanga Nickel, which initially employed 200 Tanzanians, has laid off over 150 workers (it was estimated that when the mine became fully operational by 2011 it would employ over 2000 people). In the communications sector, current information indicates that GTV has closed its business (all over Africa, including its office in Dar es Salaam), leading to a loss of direct jobs and a big loss to its trading partners and to customers who were connected to the business. The financial crisis also affected decisions to review the minimum wage, such that a proposal by the Trade Union Congress of Tanzania to set a $315 minimum wage was considered untenable by other stakeholders. The crisis also made it hard for the Tanzanian government to increase salaries for public servants in 2009/10 as in past years. 3.9 Poverty status
The onset and continuation of the crisis has undermined efforts to alleviate poverty and attain the Millennium Development Goals (MDGs). The fall in investment, loss of jobs, reduction in demand for agricultural products and minerals and decline in international tourist arrivals will worsen the country’s poverty status. However, the absence of systematic data makes it difficult to make estimates of the magnitude of the crisis impact on livelihoods and poverty in Tanzania. However, one can extrapolate the impact from loss of export revenue, leading to reduced profitability, job cuts, reduced purchasing power and lack of ability of individuals to cater for their basic needs. The loss of government revenue or use of its resources to rescue businesses (equity consideration) may mean reallocation of resources from basic sectors such as education and crosscutting investments such as road and energy.
3.10 Public and private debt
The national domestic debt stock at the end of September 2009 stood at $9330.9 million, equivalent to an increase of 9.9% on the amount at the end of June 2008. This increase is attributed to new disbursement of government bonds and depreciation of the Tanzanian shilling compared with its trading partners’ currencies, which is partly explained by the global financial crisis. Out of debt stock, 80.1% is external debt and the remaining 19.9% is domestic debt stock (see Table 9).
3.10.1 External debt
External debt stood at $7474.2 million at the end of September 2009, equivalent to an increase of 4.7%, compared with $7137.2 at the end of June 2009. Out of total external debt, $5932.8 million or 79.4% is disbursed outstanding debt (DOD) and the remaining $1541.4 is interest arrears. Analysis of external debt indicates that 69.6% of the total debt is government debt. Debt owed by private and public corporations is at 20.3% and 10.1%, respectively.
| Table 9: External debt stock by borrower category Sep 2008/09-Sep 2009/10 | |-----------------|-----------------|-----------------|-----------------|-----------------|-----------------| | | Sep 2008/09 | Share (%) | Jun 2008/09 | Share (%) | Sep 2009/10 | Share (%) | | | (US$m) | | (US$m) | | (US$m) | | | Central government | 4396.10 | 72.7 | 4893.90 | 68.6 | 5202.80 | 69.6 | | DOD | 3,780.60 | 62.5 | 4221.20 | 59.1 | 4510.70 | 60.4 | | Interest arrears | 615.5 | 10.2 | 672.7 | 9.4 | 692.1 | 9.3 | | Private sector | 1168.80 | 19.3 | 1494.20 | 20.9 | 1513.60 | 20.3 | | DOD | 742 | 12.3 | 1010.00 | 14.2 | 1025.40 | 13.7 | | Interest arrears | 426.8 | 7.1 | 484.2 | 6.8 | 488.2 | 6.5 | | Public corporations | 481.8 | 8 | 749.2 | 10.5 | 757.8 | 10.1 | | DOD | 150.8 | 2.5 | 392.3 | 5.5 | 396.7 | 5.3 | | Interest arrears | 331 | 5.5 | 356.9 | 5 | 361.1 | 4.8 | | Total external debt | 6046.70 | 100 | 7137.20 | 100 | 7474.20 | 100 |
Source: BOT data.
A profile of external debt stock by creditor category indicates that debt owed by multilateral creditors is $3831.1 million, which accounts for 51.3% of total debt, whereas bilateral creditors accounted for 21.9%. Debt owed to other creditors is shown in Table 10. Table 10: External debt stock by creditor category, 2007/08-Sep 2009/10
| Creditor Category | 2007/08 | Share (%) | Jun 2008/09 | Share (%) | Sep 2009/10 | Share (%) | |-------------------|---------|-----------|-------------|-----------|-------------|-----------| | Bilateral | 1545.80 | 25.6 | 1601.20 | 22.4 | 1633.30 | 21.9 | | Paris Club | 557.5 | 9.2 | 595.4 | 8.3 | 616.7 | 8.3 | | Non-Paris Club | 988.3 | 16.3 | 1005.80 | 14.1 | 1016.60 | 13.6 | | Multilateral | 2823.50 | 46.7 | 3545.10 | 49.7 | 3831.10 | 51.3 | | AfDB | 636.2 | 10.5 | 730.40 | 10.2 | 801.60 | 10.7 | | World Bank | 1843.40 | 30.5 | 2185.20 | 30.6 | 2388.30 | 32 | | IMF | 17.7 | 0.3 | 263.30 | 3.7 | 267.80 | 3.6 | | Others | 326.20 | 5.4 | 366.30 | 5.1 | 373.50 | 5 | | Commercial | 1039.00 | 17.2 | 1265.30 | 17.7 | 1264.40 | 16.9 | | Export credit | 638.40 | 10.6 | 725.60 | 10.2 | 725.40 | 10 | | Total external debt | 6046.70 | 100 | 7137.20 | 100 | 7474.20 | 100 |
Source: BOT data.
During the first quarter of 2009/10, new debts contracted and the net debt amounted to $77.9 million. Disbursements received and recorded during the period amounted to $250.9 million, out of which $233.8 (93.2%) was disbursed to the government and the remaining balance was received by private companies. External payments for the quarter amounted to $26.8 million, equivalent to 1.9% of export goods and services. The payments represented 39.1% of the $68.5 million scheduled for debt payments. The lower service payments were a result of accumulated arrears on non-serviced debt and inadequate information on debt serviced by private borrowers.
3.10.2 Domestic debt
Up to end-September 2009, the stock of domestic debt stood at Tsh2418.1 billion, out of which government securities were valued at Tsh2409.8 billion (99.7%) and other debts at Tsh8.2 billion (0.3%). The debt stock increase by Tsh155.7 billion (6.9%) from Tsh2262.3 registered at the end of June 2009 was attributed to the purchase of government bonds. Composition of the domestic bond by creditor category at the end of September 2009 indicates that the BOT was the leading government creditor, holding almost 42% of total domestic debt stock, followed by the commercial banks, which held 30.3%, pension funds (21.9%) and others (0.58%). 4. Policy responses and constraints
4.1 Strategic interventions at international and country level
To rescue world economies from the global downturn, the IMF called for arrangements to provide emergency liquidity, improve financial sector supervision and take a comprehensive approach to financial sector stability assessment that includes all types of institutions.
In Tanzania, international support came from the G-20, which promised to provide an additional $220 million to the government’s rescue package. Tanzania is one of eight countries receiving funds. Other African countries receiving this one-time assistance are Ghana, Liberia and Zambia. In October 2009, the US Agency for International Development (USAID) office in the country issued $37.7 million as a Financial Crisis Initiative Package. The office also promised to partner with Tanzania’s local banks to provide up to $10 million in credit and financing options for agri-businesses, including over 1000 small and micro enterprises and households through microfinance over a five-year period to stimulate production and improve food security. The AfDB announced in November the approval of another facility similar to that of USAID, to be operated through the commercial banks.
4.2 Economic and social policies
The government of Tanzania has put in place a two-year economic rescue plan (2009/10-2010/11), approved by Parliament in June 2009. The objectives of the plan are to:
1. Reduce the pressure of the crisis by providing safety nets against extreme vulnerabilities so as to protect economic growth attained over the years: protect and create jobs, ensure food security and protect key social programmes;
2. Protect key investments and continue building capacity for growth in the medium term to achieve the MDGs.
The main components of the plan are:
1. Fiscal space: To fill the gap in revenue caused by the crisis. The government accommodated in the budget for 2009/10 a net domestic financing, equivalent to 1.2% of GDP in 2008/9 and 1.6% of GDP in 2009/10.
2. Reduce the tax rate, such as the VAT rate from 20% to 18% and income tax of selected categories from 30% to 25%.
3. Accommodating monetary policy: The BOT has relaxed its monetary policy stance, beginning in the fourth quarter of 2008/09, to facilitate bank financing of the private sector.
4. Reduce the penal rate for BOT’s standby facilities (the Lombard facility and the discount rate) to allow easy and cheaper access by the banks to resources from the central bank.
5. Bridging the foreign exchange gap: A loan amounting to $336 million from the IMF under the Exogenous Shocks Facility (ESF) to fill the gap in the balance of payments caused by the decline in exports was approved by the IMF Board. The first instalment, of $245.8 million, was disbursed in June 2009. In addition, the IMF Board approved an enhancement of Special Drawing Rights (SDR) allocations to Tanzania, equivalent to $249 million.
6. Banking package: The government has provided relief to borrowers from financial institutions affected by the crisis. Two complementary instruments were issued: a) the Loss Compensation Facility, aimed at compensating for losses incurred as a result of sharp drops in cotton, seaweed and clove prices during the 2008/09 crop season; and b) the Loan Scheduling Guarantee Facility, aimed at providing a partial credit guarantee to borrowers affected by the crisis. These facilities are also expected to enable banks lending to distressed sectors to sail through the crisis safely and avert a credit crisis in the economy.
7. **Improving food distribution to curb food shortages:** The government has provided a cushion against the impact of food shortages by allocating Tsh20 billion in FY2009/09 budget to ensure food availability at a reasonable cost. Funds were provided in the October 2009 expenditure ceiling and will be used to purchase maize.
8. **Social programmes from before the crisis:** The government has maintained its commitment to support special social schemes through programmes under the Presidential Trust Fund, the Tanzania Social Action Fund, the special presidential development fund (Mabilioni ya Kikwete) and agricultural input subsidy funds for fertiliser seeds and farm implements.
### 4.2.1 What is the progress in the rescue plan?
Under the rescue plan, the government allocated Tsh1.7 trillion ($1.307 billion) in the 2009/10 budget to bail out the economy, certain areas of which had already been hit hard by the global crisis, including agricultural exports and tourism.
The government has already channelled TSh21.9 billion of this directly to the banking sub-sector to cover losses suffered by bank clients like cooperatives and firms that bought agricultural products from farmers. Announcing the package in June 2009, President Jakaya Kikwete promised that the government would further guarantee financial institutions for loans worth Tsh270 billion, extended to companies that fail to repay their loans as a result of the global recession. The guarantee will be for two years, during which period lending institutions will not charge interest on loans they extend to such institutions.
Another measure is to avail affordable capital for businesses. Under this scheme, the government has released a stimulus package of Tsh200 billion through the commercial banks. Another segment of the package has gone into guarantee schemes, whereby Tsh10 billion has been set aside for the Export Guarantee Scheme and another Tsh10 billion for small and medium-sized enterprises.
The government has intensified cross-border coordination between host country and home country supervisors so as to avoid transmitting stress from one institution to another in different countries. In order to encourage trade among businesses within the EAC for example, central banks will send remittances cross-border, eliminating the need to use clearing banks in the US and Europe.
### 4.2.2 Regulation and oversight of the capital and financial market
Under the BOT, the government has intensified surveillance of both domestic and international capital financial markets to oversee performance of all institutions, especially at this time of the crisis. The government has also formed a Financial Sector Regulatory Authority. It has also established an early warning system using selected financial soundness indicators. The BOT has established a financial stability department that produces regular financial stability reports. The BOT holds daily surveillance meetings to ensure stability in the financial sector and availability of appropriate levels of liquidity in the system.
### 4.3 Growth and development policies
The crisis is presenting both threats and opportunities for the Tanzanian economy. Threats that past achievements will be eroded have already been seen in parts of the economy, but opportunities do exist in terms of natural resources, by adding value to commodities and increasing their export value. Appreciating these opportunities, the government, through Kilimo Kwanza (‘Agriculture First’) has set agriculture as a priority growth sector. The aim is to boost agriculture by providing agriculture credit windows, among other factors. The plan also aims to improve food self-sufficiency and provide soft loans to small and agricultural intermediaries and food processors. On top of this plan, the government intends to establish a fully fledged Agricultural Development Bank. There is a plan to develop infrastructure by raising about $500 million in international financial markets, although this has been challenged since the global financial crisis as interest rates have gone up tremendously. Under this plan, the government has provided Tsh205 billion in the budget, which will be raised through issuance of long-term bonds. Already, a Tsh52.163 billion through a five-year treasury bond has been raised from the BOT. 5. Opportunities and way forward
5.1 Challenges
The main challenge for Tanzania remain its low tax base, inability to mobilise enough domestic resources for development projects and overreliance on donor finance for development projects, which risks creating unsustainable interventions.
Another challenge is how to sustain macroeconomic stability, restore and maintain low inflation and maintain fiscal prudence, financial sector stability and sustenance of the external balance in the wake of the global financial crisis.
Domestically, creating a more responsible working and governance culture, whereby all sections of society take the crisis seriously and adjust accordingly, remains a challenge. The government attempt during its 2009/10 budget to remove tax exemptions, identified as a major source of revenue leakages, was not successful, partly because of a lack of appreciation of the seriousness of the problem at hand.
The promotion of regional trade, seen as the easiest to penetrate by small and medium-sized enterprises, will require extra support efforts by government besides removing tariffs, as the EAC Common Market will be established by July 2010. Among the interventions will be strategies to reduce or eliminate non-tariff barriers and empower local producers and processors in marketing skills.
5.2 Opportunities
The crisis presents an opportunity to explore new market ventures, especially by boosting regional trade (e.g. EAC, SADC and Common Market for Eastern and Southern African (COMESA) markets), to compensate for the fall in demand for exports in traditional trading partners in Europe, the US and Asia. This includes development of a regional infrastructure network and promotion of regional tourism.
The financial downturn has led the government to postpone some projects because of the unavailability of foreign resources. This underscores the need for government to collaborate with the local private sector to finance infrastructure projects through public–private partnership systems. The government can raise capital internally through initial public offerings, government guarantees, corporate bond issues and loan syndication arrangements by banks.
There is also a need to establish new lines for foreign inflows, including promotion of diaspora remittances or establishing diaspora financial instruments.
5.3 The way forward
With commitment and willingness, the country has an opportunity to diversify the economy, lying in its rich natural resources base. The country’s plentiful agricultural land and waters can boost agriculture by adding value to products (agro-processing), as can prudent use of natural resources such as minerals, natural gas, forestry and fishery products and promotion of regional tourism, given Tanzania’s many tourist attractions compared with its neighbouring countries.
The transport sector can provide substantial future sources of income and employment in the country. Improvement of infrastructure in road, railways and ports (e.g. Dar Port) will assist in the speedy transport and clearance of transit goods to landlocked countries such as the Democratic Republic of Congo, Uganda, Rwanda, Burundi, Malawi and Zambia. The global financial crisis has highlighted the importance of increasing surveillance in terms of regulation and supervision, not only for commercial banks but also for the entire financial system (to include pension funds and insurance companies).
It is also necessary to implement judicious capital account liberalisation. The Tanzanian financial sector was barely hit by the global financial crisis simply because the capital account is only partially liberalised. The planned liberalisation process should be carefully designed to facilitate smooth portfolio flows while ensuring the stability of the small and fragile financial sector.
The design and management of social safety nets should take into account their sustainability in terms of creating wider multiplier effects. This includes the issuance of revolving funds (e.g. Mabilioni ya Kikwete (Billions from President Kikwete) and input subsidies for peasants), whose operations could be tied to local resource mobilisation (e.g. village banks and savings and credit cooperative societies) and farmer empowerment, to commercialise farm production and produce in response to identified markets and to invest in specific value chains for different commodities. References
Bank of Tanzania (2008a) ‘Monthly Economic Review, June’. Dar es Salaam: BOT. Bank of Tanzania (2008b) ‘Monthly Economic Review, August’. Dar es Salaam: BOT. Bank of Tanzania (2008c) ‘Monthly Economic Review, November’. Dar es Salaam: BOT. Bank of Tanzania (2009a) ‘Quarterly Report 2009, June 2009’. Dar es Salaam: BOT. Bank of Tanzania (2009b) ‘Annual Report 2008/09’. Dar es Salaam: BOT. Bank of Tanzania (2009c) The Impact of Global Financial Downturn and the Government Stimulus Package. Dar es Salaam: BOT. Bank of Tanzania (2009d) ‘Monthly Economic Review, November’. Dar es Salaam: BOT. Bank of Tanzania (2009)’Global Financial crisis: challenges and Response’ (Paper presented by Prof. Beno Ndulu, the BOT Governor on March 2009) International Monetary Fund (2009) ‘Tanzania Country Report, June’. Washington, DC: IMF. International Organization for Migration (IOM) 2009: Study on Remittances between Tanzania and Uganda(forthcoming) Mkulo, M. (2009) ‘Estimates of Government Revenue and Expenditure for the Financial Year 2009/10’. Minister of Finance and Economic Affairs Budget Speech 2009/10, 11 June. United Republic of Tanzania (2009a) ‘Review of Recent Macroeconomic Performance’. Prepared for NSGRP/GBS Consultative Meeting. Dar es Salaam, November. United Republic of Tanzania (2009b) ‘Poverty and Human Development Report 2009’. Draft. Dar es Salaam: URT. United Republic of Tanzania (2009c) ‘Mpango wa Kuunusuru Uchumi wa Tanzania na Athari za Msukosuko wa Fedha na Uchumi Duniani’ (National Plan to Rescue the Economy from the Global Financial Crisis). Dar es Salaam: URT. World Bank (2008) Migration and Remittances Facts Book. Washington, DC: World Bank. World Bank (2009) The Global Financial Crisis. Washington, DC: World Bank.
### Annex 1: Exports by type of commodity, Jul 2008-Jul 2009
| | % change | Year to Jul 2009 | % change | |----------------------|----------|------------------|----------| | | Jul 08-Jul 09 | Jun 09-Jul 09 | 2008 | 2009 | | | **Traditional exports** | | | | | | | **Coffee** | | | | | | | Value | 171.4 | -52.2 | 83.7 | 121.4 | 45.1 | | Volume | 194.7 | -57.6 | 36.0 | 60.5 | 68.0 | | Unit price | -7.9 | 12.8 | 2321.8 | 2005.5 | -13.6 | | **Cotton** | | | | | | | Value | -28.1 | 17.1 | 91.7 | 127.8 | 39.3 | | Volume | -38.3 | -18.3 | 77.9 | 107.4 | 37.9 | | Unit price | -16.6 | 43.2 | 1,177.4| 1189.3 | 1.0 | | **Sisal** | | | | | | | Value | -27.3 | 8.0 | 35.9 | 31.1 | -13.4 | | Volume | -33.2 | 4.6 | 25.0 | 18.8 | -24.7 | | Unit price | 8.8 | 3.2 | 1433.9 | 1649.3 | 15.0 | | **Tea** | | | | | | | Value | -18.3 | -70.1 | 4.3 | 14.9 | 243.8 | | Volume | 38.1 | 72.8 | 3504.8 | 3359.4 | -4.1 | | **Tobacco** | | | | | | | Value | 12.9 | -48.3 | 4.3 | 14.9 | 243.8 | | Volume | -18.3 | -70.1 | 1.2 | 4.4 | 258.7 | | Unit price | 8.8 | 3.2 | 1433.9 | 1649.3 | 15.0 | | **Cloves** | | | | | | | Value | 12.9 | -48.3 | 4.3 | 14.9 | 243.8 | | Volume | -18.3 | -70.1 | 1.2 | 4.4 | 258.7 | | Unit price | 8.8 | 3.2 | 1433.9 | 1649.3 | 15.0 | | **Non-traditional exports** | | | | | | | **Minerals** | 12.8 | 35.3 | 1010.1 | 881.5 | -12.7 | | Gold | 14.9 | 34.9 | 947.7 | 838.4 | -11.5 | | Diamonds | -100.0 | -100.0 | 22.4 | 12.3 | -45.2 | | Others\* | 20.2 | 243.6 | 40.0 | 30.8 | -22.8 | | **Manufactured goods** | -74.2 | 17.7 | 8.4 | 14.9 | 78.5 | | Cotton yarn | -6.9 | -40.9 | 1.0 | 0.4 | -66.6 | | Manufactured tobacco | -90.1 | -11.6 | 11.6 | 5.8 | -49.7 | | Sisal products (yarn and twine) | -57.3 | 59.7 | 470.0 | 547.4 | 16.5 | | Fish and fish products | 22.0 | 84.6 | 148.9 | 134.2 | -9.9 | | Horticultural products | -10.8 | -13.9 | 24.9 | 36.2 | 45.4 | | Other exports\*\*\* | -47.8 | -12.2 | 241.1 | 267.4 | 10.9 |
**Notes:** * = includes tanzanite, rubies, sapphire, emerald, copper, silver. \*\* = Includes plastic items, textiles, apparels, iron/steel. \*\*\* = includes edible vegetables, oilseeds, cereals, cocoa, rawhides and skins and woods. \*\*\*\* = Volumes in '000 tons; values in US$ millions; unit price in US$.
**Source:** BOT (2009d).
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e7d9033776d7b38e4d4b2bbdcde506f24e699e5a | Comments for NP/DDD/0318/0173 (ref: NP/DDD/0318/0173)
Name: Kenneth Berry Address: 4 Audrey Cottages, Little Edge, Eyam, Hope Valley Postcode: S32 5RN
Type of comment: Objection Comments: I strongly object to this application for the reasons I set out below:-
1. Access for Emergency vehicles. The current parking in Little Edge is severely limited. This has meant on a number of occasions that ambulances have not been able to negotiate Little Edge to attend emergencies of residents in Audrey Cottages and Hydon House.
2. Parking for residents. The osteopathy centre has no off street parking. The current operation is between 4/5 days a week with limited opening hours. The proposal is to be open 7 days a week, 12 hours a day. The application states that 12 hours opening is normal at the moment - this is not the case! as i note as a resident passing regularly.
The current parking in Little Edge and Main Road is currently severely limited for residents due to properties in the area used as holiday homes and other local existing businesses parking their cars and business vehicles in Little Edge and Main Road.
3. Parking for staff. The proposed new business expansion indicates employing unto 6 staff and a significant increase in the size of the business property by at least 300%. The application states that there is no private parking and that staff will be asked to park in the public parking around the corner. This public parking is some 250 yards away. Whilst the staff may be asked to park in the public parking this is not guaranteed.
Eyam is a tourist attraction. In the summer period the public car park is often full. Where will it be proposed for staff and patients to park?
4. Parking for patients. The proposal refers to remedial treatment from severe debilitating conditions 'to relearn to walk safely after a stroke etc'. People with walking difficulties will find it difficult to walk 500 yards to and from the public car park, particularly as this involves going up and down 2 hill slopes each way. Therefore they will park as close as possible to the centre. I also note that this will include group sessions and baby and adult swim sessions as well as 1to1 sessions as is the current practice. This will significantly exaggerate the demands on parking in Little Edge and Main Road.
The application refers to enabling wheelchair access to the front of the barn. This will be direct onto the main road, immediately adjacent to a bus stop and shelter and a telecoms hub. This will cause a hazard and danger to patients alighting outside of the centre, a hazard to bus passengers alighting at the bus stop and a conflict where the telephone hub needs to be accessed by engineers. Please note that there is currently a single yellow line on all highway access around the centre.
The proposed change refers not only to a ground floor studio with various equipment but a 2nd floor with 2 treatment rooms and a waiting area. It must be assumed that all of this will create a significant increase in patient numbers and associated street traffic.
5. Public transport and utility vehicles. The amount of parking on Main Road already significantly impacts the transit of busses through the village. A bus stop is immediately outside of the osteopathy centre (both sides of the road). Any additional parking for the centre will create an additional hazard and danger to persons alighting/boarding busses.
Public utility vehicles (i.e. refuse collection vehicles) already have difficulty in proceeding up Little Edge to fulfil their function, as do delivery vehicles delivering parcels to the residents of Audrey Cottages, Hydon House and Little Edge.
6. Culvert and public utilities in Little Edge. Jumber Brook runs under Little Edge in a stone culvert which has been known to overflow on a number of occasions. There is already significant damage to the road surface in Little Edge which maybe caused by current traffic and water flow. Damage to this culvert caused by significant increased traffic could lead to flooding in Little Edge, Main Road and the properties therein. This will be exacerbated by additional traffic. The water supply to the properties in Little Edge is already low pressure. The implementation of the proposed application will only make this situation far worse, both in provision of water supply and drainage of water from the centre (i.e. hydrotherapy, pool etc).
7. Business plan viability. This plan seeks to treble the size of the business operation, provide new jobs and increase the number of patients. However, the plan states "I feel this turnover will be no different than what the clinic is currently being used". This is absolutely ridiculous given the proposed capital outlay and business expansion and additional 7 day operation!!!
Whilst I have no particular objection to the current operation, I think that an operation as proposed in the application should only be considered in a property which provides its own off street parking consistent with the size of the proposed operation and the nature of the patients.
Eyam is a small village and I can only assume that this increase in size is intended to encourage patients from outside of the village which must by the nature of the patients and distance of travel, incur numerous car journeys.
Given the extensive work proposed in the application and the location of the property, the work on the alterations are very likely to cause a major disruption for access to residents in Little Edge and Audrey Cottages and Hydon House, which could include denying access to their properties which is totally unacceptable.
8. Planning regulations. I have only been made aware of this application by chance, by a neighbour. I understand that the only notification posted up in the area, was a single notice on the main road across from the centre. This is not obvious or visible if driving into or up Little Edge. Does this comply with planning regulations? The residents in Little Edge (which is a small cul-de-sac) have not received any postal notification of this application. The residents in Audrey Cottages and Hydon House will be particularly affected by proposed application. I ask again does this comply with planning regulations?
Sent Sun 15/04/18 at 17:34
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8ebd086924c43fa3cceeb67a578bbe6416656b4d | Design and Access Statement
6 Fellview Close, Ladybower Drive, Hathersage, S32 1DS
- A single storey ground floor extension to the east of the existing building
- A new garden room extension to the north to replace an existing conservatory
- A further small extension to the kitchen will create a more appropriate ground floor layout
- A ground floor toilet and shower room providing more accessible accommodation long term
(Street view of 6 Fellview Close: Corner entrance with minimal impact)
Planning Submission
26th April 2018 1.0 Introduction
We are submitting a planning application to extend the property’s ground floor and re-design the internal layout. The proposal consists of the following:
- A single storey ground floor extension to the east of the existing building
- A new garden room extension to the north which will replace an existing conservatory
- A further small extension to the kitchen will create a more appropriate ground floor layout
- A ground floor toilet and shower room providing more accessible accommodation long term
These changes will create a larger more accessible living and dining space.
2.0 Context - Describing the existing setting and design of the main dwelling, any outbuildings and surrounding development within 50 metres
(Including: topography, gradients, landscape features of note, detached, semi, terraced, number of storeys, predominant external materials in the street scene)
The property is a two storey, semi-detached, non-traditional house in a late 20th century development. Built of davy block, the house sits on a corner plot with an unusually large garden for the scale of the property. This leaves ample space for extension.
The house is attached to another property at the front of the plot and shares an alleyway with a property to the west. There is a row of semi-detached houses roughly 27 meters to the south, one of which shares a garden wall with 6 Fellview Close. Larger scaled properties on Ninelands Road, (45 meters to the east), face over the property but are screened by a large of area trees and planting.
3.0 Proposals – Explanation of how the size and siting of the proposal relates to the street scene and main dwelling and clarify details of the proposed external materials, including walls, roof, windows, doors and external hard surfacing
(This is to enable us to assess the impact of the design and its suitability for the site and wider locality)
As a corner plot the property has very minimal impact on the street scene and is largely screened off from the street by the attached property.
Small Kitchen Extension – The proposals include a small extension to the kitchen wall to bring it in line with the existing porch wall. By extending the kitchen a short distance a reasonably sized kitchen and dining arrangement is created. The new layout also helps connect the new dining room with the rest of the house. The small extension will be completed in stone or davy block to match with the existing and a new glazed roof will continue the existing porch roofline. As this extension is behind the existing porch and along the property’s garden access, there will be very minimal impact on the existing street scene.
Conservatory – the all glass conservatory will be replaced with a garden room extension built in stone to match the existing with an insulated slate roof. This will provide a more contemporary, sustainable solution whilst a large rear window will help maintain a connection to the garden.
Living Room Extension – The entrance currently opens straight into the client’s living room making it effectively a circulation space. The house was previously extended to create the ‘snug’, (as marked on drawing 002), however this space is undersized and doesn't provide enough space for all the occupants to sit down together. As a result the space is underused. The proposed extension, using stone work and a slate or hardrow tiled roof, (to match the existing), will create a new living room space, freeing up the current living space for a more appropriate entrance arrangement.
New WC – the new living room extension will allow space for a new cloakroom, WC and shower room within the entrance sequence. The ground floor WC will provide accessible accommodation for future use.
There will be no changes to the external hard surfacing. The extensions are all out of sight of the public highway so do not read with the wider development. As a result the enhancements proposed remain subservient to the existing buildings.
4.0 Environmental Management – Explanation of how energy conservation and the use of any renewable energy technology has been incorporated in the proposal.
Also refer to any sustainability measures such as grey water recycling, porous surfacing to control surface water run off and use of sustainable materials. You may also find it useful to refer and fill in the checklist in the application pack “Environmental Management Measures to combat Climate Change”.
The extension replacing the conservatory is designed to be more sustainable. The current arrangement with the uninsulated conservatory open into the insulated living spaces creates a significant energy loss. The proposed dining room will be an insulated extension of the living spaces. As a result the house will significantly increase in energy efficiency. 5.0 Impact – Explanation of any specific measures taken to protect the privacy and impact on the living conditions of neighbours windows
(For example: screening, positioning of access arrangements)
To reduce the impact on the privacy of the neighbours across the alleyway, (to the west), an existing window in the kitchen has been removed in the proposed extension. Instead the new connection with the proposed dining room will increase the light levels to the kitchen, alongside a new south facing window. Furthermore the dining room extension has significantly less glazing than the existing conservatory and therefore reduces any potential view over the neighbouring property.
As a result the proposed scheme represents a significant reduction in impact on the neighbouring property.
6.0 Pre-application advice received from Peak Park Planning Officers
The applicant received pre-application advice on a two storey structure in July 2017. (advice based on a two storey scheme which has been revised):
- ‘An extension of 3/3.5 meters is likely to be acceptable’
- ‘There would be no objection roof lights in the roof slope provided they are of a suitable scale for the roof slope they will serve and can be fitted flush into the roof slope’
- ‘The proposed single storey side extension ... is considered to be an subsidiary addition and raises no objections provided that the roof pitch is acceptable’
We have noted the planner’s advice regarding the pitch of the side extension and have kept the roof at a lower pitch than the main roof to ensure it reads as a subsidiary element.
- ‘It is hard to make a judgement without reviewing the proposal on an elevation. This would need to be included in an application so the highways department can review the proposal’
We have included a street elevation for review as suggested. • ‘Overall I consider the principle of the proposals to be acceptable’
This scheme is a significantly reduced proposal but still enables the applicant to increase accommodation and living space. The extension is now single storey and acts as a subsidiary element to the main building as requested in the advice above.
Further advice was given by Denise Hunt at a site meeting on the 13th of March following a planning application:
• ‘The kitchen extension utilising the recess between the porch and the house, is, in this instance, considered to be acceptable due to the location and the orientation of the dwelling, but as advised, it would be preferable to create a lean-to roof over both the porch and the kitchen extension so that it would be seen as one, rather than two elements’
We have noted the planner’s advice regarding the roof of the kitchen extension and have proposed one glazed roof to unite the porch and extension as one element.
• ‘The replacement of the existing conservatory with a more substantial garden room is also considered acceptable as it will present an enhancement to the existing; as previously advised, we would prefer to see a more traditional roof covering, and in this instance either hardrow to match the existing dwelling or blue slate would work well. However, we discussed the chimney and I stated my preference for a much less visually intrusive flue pipe, exiting through the roof slope and kept to a minimum height so that it did not protrude over the ridge height, a flue could be painted a matt colour to blend with the roof’
The comments regarding the dining room extension have also been accommodated and the stone chimney revised to a modest stove flue. A slate or concrete tile roof has been incorporated to give a clear connection between the extension and the existing property.
• ‘The problem is how to enlarge the snug without the massing being awkward, as initially noted, wraparound extensions can be contentious...I wonder whether instead of trying to extend to the east, the additional space could be created within the house, if the downstairs shower room and cloaks were swapped round then the snug/new living room could be extended inwardly to create a larger room in conjunction with an extension under PD rights’
We consider that the recommendation to find the required space within the building, (instead of extending to the east), will create an irregular layout in the kitchen and undermine the client’s aim of rationalising the internal spaces. Furthermore the suggested approach requires access from the new hall to the kitchen, under the stairs, at a point where insufficient head height can be achieved. As a result we believe the best solution to the client’s brief and to enhance the property for the future is to extend the living room/snug to the east and south as shown in the proposed drawings.
We have also responded to Denise Hunt’s advice by pitching the roof as a monopitch at 22 degrees, reducing the impact of the extension. As a result the large majority of the extension is a permitted development. See attached sketch fig.1 for a diagram expressing this relationship. The work not covered by permitted development adds just 1.2m width to the living room. We consider this to be a modest extension which provides a significant enhancement to the internal arrangement, enabling the house to function as a reasonably sized home and provide more accessible accommodation long term.
(fig.1 – Diagram demonstrating the side extension – the grey section is the area requiring approval. It represents a modest extension of 1.2m)
We believe the proposals represent an enhancement to the building elevation and improves the internal arrangement providing a more appropriate and desirable property.
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5d43b9c562982d7df1dd43ebbfe0083af494d5b7 | 2 no. Bedrooms 1 x En Suite & 1 x Bathroom
Open Plan Living, Dining & Kitchen takes advantage of vaulted ceiling above. ALL DIMENSIONS TO BE CHECKED ON SITE. DO NOT SCALE FROM THIS DRAWING FOR CONSTRUCTION PURPOSES.
NOTES:
EXISTING Roofscape Floor Plan SKETCH PROPOSALS
DRAFT COMMENTS ON APPLICATION BY OTHERS
18 04 18
APPROX 1:100 @ A3
This drawing and all the information shown is the property of 5/10am Design and shall not be copied whole or in part or used for any other purpose without written permission of the company.
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6459d0d53f15a1975cc5e654254d0439af2ec4b6 | BIRCHOVER QUARRY Addendum to Pavement Visual Condition Survey (Designated HGV Route)
47075218
July 2017
Prepared for: Birchover Stone Limited
Prepared by: AECOM
## REVISION SCHEDULE
| Rev | Date | Details | Prepared by | Reviewed by | Approved by | |-----|---------|---------------|----------------------|-----------------------|----------------------| | 1 | 03-08-17| First Issue | Jordan Wardle | Darren Ball | Gary Hurrell | | | | | Trainee Technician | Principal Engineer | Technical Director |
Document Reference: BSLQ-AEC-HG-XX-RP-CE-00004 Limitations
AECOM Infrastructure & Environment UK Limited (“AECOM”) has prepared this Report for the sole use of Birchover Stone Limited (“Client”) in accordance with the Agreement under which our services were performed, letter ref GH/JM/314738/ZBID dated 18 May 2015. No other warranty, expressed or implied, is made as to the professional advice included in this Report or any other services provided by AECOM. This Report is confidential and may not be disclosed by the Client nor relied upon by any other party without the prior and express written agreement of AECOM.
The conclusions and recommendations contained in this Report are based upon information provided by others and upon the assumption that all relevant information has been provided by those parties from whom it has been requested and that such information is accurate. Information obtained by AECOM has not been independently verified by AECOM, unless otherwise stated in the Report.
The methodology adopted and the sources of information used by AECOM in providing its services are outlined in this Report. The work described in this Report was undertaken in July 2017 and is based on the conditions encountered and the information available during the said period of time. The scope of this Report and the services are accordingly factually limited by these circumstances.
Where assessments of works or costs identified in this Report are made, such assessments are based upon the information available at the time and where appropriate are subject to further investigations or information which may become available.
AECOM disclaim any undertaking or obligation to advise any person of any change in any matter affecting the Report, which may come or be brought to AECOM’s attention after the date of the Report.
Certain statements made in the Report that are not historical facts may constitute estimates, projections or other forward-looking statements and even though they are based on reasonable assumptions as of the date of the Report, such forward-looking statements by their nature involve risks and uncertainties that could cause actual results to differ materially from the results predicted. AECOM specifically does not guarantee or warrant any estimate or projections contained in this Report.
Unless otherwise stated in this Report, the assessments made assume that the sites and facilities will continue to be used for their current purpose without significant changes.
Where field investigations are carried out, these have been restricted to a level of detail required to meet the stated objectives of the services. The results of any measurements taken may vary spatially or with time and further confirmatory measurements should be made after any significant delay in issuing this Report.
Copyright
© This Report is the copyright of AECOM Infrastructure & Environment UK Limited. Any unauthorised reproduction or usage by any person other than the addressee is strictly prohibited.
# TABLE OF CONTENTS
1. INTRODUCTION ................................................................. 1
2. VISUAL CONDITION SURVEY ........................................... 1 2.1 General ........................................................................... 1 2.2 Birchover Road ............................................................. 2 2.3 Barton Hill ..................................................................... 7 2.4 Main Street .................................................................... 12 2.5 The Mires ..................................................................... 16
3. SUMMARY ........................................................................ 26
APPENDIX A – DRAWINGS
Plan 3 - Section 106 Agreement
1. INTRODUCTION
AECOM has been commissioned by Birchover Stone Limited to undertake an annual visual assessment of the condition of the road between Birchover Quarry and the B5056. The annual survey is required to satisfy condition 42 of the planning permission (ref NP/DDD/0312/0257) and obligation 8 of the Section 106 agreement. Planning condition 42 states:
‘The site operator shall, throughout the period of use of the site accesses in connection with the approved development, submit to the Mineral Planning Authority no later than 7 May each year the results of annual surveys with the Local Highway Authority of the condition of the highway along the designated HGV route as defined in condition 41 to this permission and identification of any damage thereto attributable to the approved development.’
This report is the second addendum to the initial condition survey carried out and reported in July 2015, BSLO-AEC-HG-XX-RP-CE-00002 ‘Pavement Visual Condition Survey’ and should be read in conjunction with that report and subsequent addendum report.
The annual visual condition survey was undertaken on Wednesday 12 July 2017 by Peter Stevenson of Derbyshire County Council along with Darren Ball and Jordan Wardle of AECOM in accordance with the requirements of the obligation.
2. VISUAL CONDITION SURVEY
2.1 General
The original pavement condition report described above will provide general details of the existing carriageway, initial condition and survey methodology.
This second annual follow up visual condition survey did not identify any significant additional defects from those identified during the initial survey.
The survey photographs below highlight the current status of the previously identified defects and, where appropriate, provides commentary on any meaningful change. The initial report sequentially numbered the photographs of identified defects. To enable the cross comparison of defects for future annual surveys the following photograph numbering system has been adopted.
Photograph x.x.x where –
x.0.0 represents the sequential annual visit. 0.x.0 represents the sequential defect identification number. 0.0.x represents the sequential photograph number associated with the defect.
Example:
Photograph 2 identifying an existing defect within the initial report is now referenced as ‘Defect 1.01.1 under the revised numbering system and represents the first annual inspection, the first identified defect and the first photograph associated with the defect.' 2.2 Birchover Road
Defect 01 (main report photograph reference 2) Slight deterioration of the access slab off the highway compared to the previous site visit but no significant change to the highway.
Photograph 2.01.1 : Location – Access to the existing Birchover Quarry Entrance, approximate Chainage 16, Direction – South
Defect 02 (main report photograph reference 3) No significant change
Photograph 2.02.1 : Location – Chainage 40, Direction - South Defect 03 (main report photograph reference 4) No significant change
Photograph 2.03.1 : Location – Chainage 60, Direction - South
Defect 04 (main report photograph reference 5) No significant change
Photograph 2.04.1 : Location – Chainage 90, Direction - South Defect 05 (main report photograph reference 6) A slight deterioration to the surface (surface dressing) caused by the turning of large vehicles into and out of the site. This is not considered to be a significant change.
Photograph 2.05.1: Location - Chainage 180 (Birchover works entrance), Direction – South
Photograph 2.05.2: Location - Chainage 180 (Birchover works entrance), Direction – South Defect 06 (main report photograph reference 7) No significant change. No photograph.
Defect 07 (main report photograph reference 8) A slight deterioration of the surface (surface dressing) although this is not a significant change from the initial survey.
Photograph 2.07.1 : Location - Chainage 265, Direction – South
Photograph 2.07.2 : Location - Chainage 270, Direction – South Defect 08 (main report photograph reference 9 to 11) No significant change.
Photograph 2.08.1 : Location – Approximate Chainage 352 at the junction between Birchover Road / Barton Hill / Lees Road, Direction – East
Photograph 2.08.2 : Location – Approximate Chainage 360 at the junction between Birchover Road / Barton Hill / Lees Road, Direction – Southeast 2.3 Barton Hill
Defect 09 (main report photograph reference 10) No significant change.
Photograph 2.09.1 : Location – Chainage 380, Direction – South
Defect 10 (main report photograph 11 to 16) Defect of delaminated surface dressing from Chainage 390 to 460. No significant change.
Photograph 2.10.1 : Location – Chainage 390, Direction – South Photograph 2.10.2 : Location – Chainage 400, Direction – Southwest
Photograph 2.10.3 : Location – Chainage 430, Direction – Southwest Defect 11 (main report photograph reference 17) No significant change.
Photograph 2.11.1 : Location – Chainage 525, Direction – Southwest
Defect 12 No significant change.
Photograph 2.12.1 : Location – Chainage 530, Direction – Southwest Defect 13 (main report photograph reference 18 & 19) No significant change.
Photograph 2.13.1 : Location – Chainage 550, Direction – West
Photograph 2.13.2 : Location – Chainage 560, Direction – West Defect 14 (main report photograph reference 20) No significant change.
Photograph 2.14.1 : Location – Chainage 589, Direction – East
Defect 15 (main report photograph reference 21) No significant change.
Photograph 2.15.1 : Location – Chainage 705, Direction – West 2.4 Main Street
Defect 16 (main report photograph reference 22) No significant change. Defect 17 (main report photograph reference 23) No significant change, No Photograph.
Defect 18 (main report photograph reference 24) No significant change. New patching works were evident on the westbound carriageway between Chainage 820 and 850 within the extents of carriageway deformation previously identified (Photographs 2.18.2 & 2.18.2).
Photograph 2.18.1 : Location – approx. Ch790, Direction – West
Photograph 2.18.2 : Location – Chainage 820 - 850, Direction – West Defect 19 (main report photograph reference 25) No significant change. Defect 20 (main report photograph reference 26) No significant change.
Photograph 2.20.1 : Location – Chainage 970, Direction – West
Defect 21 (main report photograph reference 27) No significant change.
Photograph 2.21.1 : Location – Chainage 980, Direction – West 2.5 The Mires
Defect 22 (main report photograph reference 28) Carriageway patching was evident in the location of the previously identified longitudinal cracking. It should be noted this patching does not encompass the full extent of the crack identified.
Photograph 2.22.1 : Location – Chainage 1040 - 1060, Direction – North
Defect 23 (main report photograph reference 29) No significant change.
Photograph 2.23.1 : Location – Chainage 1050, Direction – South Defect 24 (main report photograph reference 30) No significant change.
Photograph 2.24.1 : Location – Ch.1105, Direction – North
Defect 25 (main report photograph reference 31) No significant change.
Photograph 2.25.1 : Location – Chainage 1150, Direction – North Defect 26 (main report photograph reference 32) No significant change.
Photograph 2.26.1 : Location – Chainage 1150, Direction – North
Photograph 2.26.2 : Location – Chainage 1160, Direction – North Defect 27 (main report photograph reference 33) No significant change, No Photograph.
Defect 28 (main report photograph reference 34 & 35) No significant change.
Photograph 2.28.1 : Location – Chainage 1308, Direction – West
Photograph 2.28.2 : Location – Chainage 1308, Direction – West Defect 29 (main report photograph reference 36) No significant change.
Photograph 2.29.1 : Location – Chainage 1381, Direction – Southwest
Defect 30 (main report photograph reference 37) No significant change.
Photograph 2.30.1 : Location – Chainage 1580, Direction – West Defect 31 (main report photograph reference 38) No significant change.
Photograph 2.31.1 : Location – Chainage 1635, Direction – West
Photograph 2.31.2 : Location – Chainage 1635, Direction – West Defect 32 (main report photograph reference 39) No significant change.
Photograph 2.32.1 : Location – Chainage 1640, Direction – South
Defect 33 (main report photograph reference 40) No significant change.
Photograph 2.33.1 : Location – Chainage 1680, Direction – West Defect 34 (main report photograph reference 41) No significant change, No Photograph.
Defect 35 (main report photograph reference 42) No significant change.
Photograph 2.35.1 : Location – Chainage 1755, Direction – West
Defect 36 (main report photograph reference 43) No significant change. No Photograph
Photograph 2.36.1 : Location – Chainage 1800, Direction – East Defect 37 (main report photograph reference 44 & 45) No significant change.
Photograph 2.37.1 : Location – Chainage 1840, Direction – West
Photograph 2.37.2 : Location – Chainage 1860, Direction – West Defect 38 (main report photograph reference 46 to 48) No significant change. 3. SUMMARY
The annual 2017 visual condition survey did not identify any significant change to existing defects identified during the initial and subsequent survey. There were also no additional defects identified during this survey.
It should be noted that there were signs of continued deterioration of the surface dressing along the route but it was agreed with Peter (DCC Inspector) that this is likely to be natural wear and tear leading to suggest the trafficking of quarry traffic along the route has not caused any consequential damage to the carriageway. APPENDIX A – DRAWING ABOUT AECOM In a complex and unpredictable world, where growing demands have to be met with finite resources, AECOM brings experience gained from improving quality of life in hundreds of places. We bring together economists, planners, engineers, designers and project managers to work on projects at every scale. We engineer energy efficient buildings and we build new links between cities. We design new communities and regenerate existing ones. We are the first whole environments business, going beyond buildings and infrastructure. Our Europe teams form an important part of our worldwide network of nearly 100,000 staff in 150 countries. Through 360 ingenuity, we develop pioneering solutions that help our clients to see further and go further. www.aecom.com Follow us on Twitter: @aecom
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10c35d9923cdd5dcfaee7f6463b5ae64b4f80df2 | Dear Steven
Thank you for consulting DDDC Environmental Health, regarding the above application.
I do not have any objections in principle to this application. However, due to the nature of the proposed use of the unit, there is the potential for a noise nuisance to exist, due to the levels and duration of noise from dogs barking from the unit.
I note that the applicant has stated that the number of dogs to be accommodated in the premises at any one time will not exceed 14. It is anticipated that there shall be sufficient staff on site at all times to ensure that dogs are controlled and not permitted to cause a noise nuisance.
As the unit is on an existing industrial business centre, it is evident that several potentially noisy businesses already exist on the site. However, as far as I am aware, we have not received any noise complaints regarding noise from any of these businesses. The location of unit 5 is some distance from the nearest noise sensitive residential premises. As such, I would not suggest that there was an inevitable risk of noise nuisance from dogs barking from within the unit, effecting nearby residential premises. I would anticipate that the existing unit incorporates various noise attenuation measures within the structure of the building, however, should further attenuation be required, this should be relatively easy to incorporate.
However, should the application be approved and the unit is used for providing dog day care facilities, any subsequent noise complaints shall be dealt with under the Council’s standard noise complaint procedures and the Environmental Protection Act 1990.
I trust this information is helpful.
Kind regards
Matthew Hulley Environmental Health Officer Tel: 01629 761350 E-mail: [email protected] Just following up on a consultation we made on 12/4/2018? I’m concerned about the potential noise impact of the proposed dog daycare. Have Environmental Health any comments on this?
Steven Wigglesworth HND, BA (Hons), MA, MRTPI Planner Development Management 01629 816287
Please be aware that I will be on leave on the 29th and 30th May 2018, from 16th June 2018 returning to the office on 2nd July 2018, also 17th August 2018 returning to the office on the 28th August 2018.
Steven Wigglesworth Planner 01629 816287 [email protected]
Peak District National Park Authority, Aldern House, Baslow Road, Bakewell, DE45 1AE. Phone:01629 816200
This email is confidential, may be legally privileged and/or contain personal views that are not the Authority’s. It is intended for the addressee. If received in error please notify us and delete immediately. Under Data Protection and Freedom of Information legislation contents may be disclosed and the Authority reserves the right to monitor sent and received emails.
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Do you really need to print out this e-mail? Be Green – keep it on the screen
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b67ad4d8bcafe89736626991f209e55f411b8cde | Application for approval of details reserved by condition. Town and Country Planning Act 1990 Planning (Listed Buildings and Conservation Areas) Act 1990
Publication of applications on planning authority websites. Please note that the information provided on this application form and in supporting documents may be published on the Authority’s website. If you require any further clarification, please contact the Authority’s planning department.
1. Applicant Name, Address and Contact Details
| Title: | Mr | First Name: | Teifion | Surname: | Salisbury | |--------|----|-------------|---------|----------|-----------| | Company name: | | | | | | | Street address: | Burre House, Baslow Road | | | | | | Telephone number: | | | | | | | Mobile number: | | | | | | | Town/City: | Bakewell | | | | | | Country: | | | | | | | Postcode: | DE45 1AB | | | | | | Are you an agent acting on behalf of the applicant? | Yes | No |
2. Agent Name, Address and Contact Details
| Title: | Mr | First Name: | Paul | Surname: | Stanton | |--------|----|-------------|------|----------|---------| | Company name: | Guy Taylor Associates | | | | | | Street address: | Long Mill | Darley Abbey Mills | | | | | Telephone number: | | | 01332477525 | | | | Mobile number: | | | | | | | Town/City: | Derby | | | | | | Country: | | | | | | | Postcode: | DE22 1DZ | | | | | | Email address: | | | [email protected] | | | 3. Site Address Details
Full postal address of the site (including full postcode where available)
| Description: | |--------------| | |
House: [ ]
House name: Burre House
Street address: Baslow Road
Town/City: Bakewell
Postcode: DE45 1AB
Description of location or a grid reference (must be completed if postcode is not known):
Easting: 421765
Northing: 369111
4. Pre-application Advice
Has assistance or prior advice been sought from the local authority about this application?
- Yes
- No
5. Description of the Proposal
Please provide a description of the approved development as shown on the decision letter:
Refurbishment of existing Grade II listed property, demolition of existing garage annexe in disrepair, extension of kitchen & sitting area, associated stonework cleaning and improvements to garden areas.
Application reference number: Planning Consent NP/DDD/1017/1015 Listed Building Consent 5/16/383
Date of decision: 23/11/2017
Please state the condition number(s) to which this application relates:
Condition number(s):
Planning Consent NP/DDD/1017/1015
- Condition 4
- Condition 5
- Condition 6
- Condition 7
- Condition 8
Listed Building Consent 5/16/383
- Condition 3
- Condition 5
- Condition 6
- Condition 7
- Condition 10
- Condition 11
- Condition 12
- Condition 13
- Condition 14
Has the development already started?
- Yes
- No
6. Discharge of Condition(s)
Please provide a full description and/or list of the materials/details that are being submitted for approval:
Drawing nos:
812.1246.1-08-001 812.1246.1-08-002 812.1246.1-08-003 6. Discharge of Condition(s)
812.1246.1-08-004 812.1246.1-08-005 Methodology for removal of staircase and fireplace Mortar spec and sample photograph
7. Part Discharge of Condition(s)
Are you seeking to discharge only part of a condition?\
☐ Yes ☐ No
If Yes, please indicate which part of the condition your application relates to:
Listed Building Consent 5/16/3839 Conditions 7 and 14
8. Site Visit
Can the site be seen from a public road, public footpath, bridleway or other public land?\
☐ Yes ☐ No
If the planning authority needs to make an appointment to carry out a site visit, whom should they contact? (Please select only one)
☐ The agent ☐ The applicant ☐ Other person
9. Declaration
I/we hereby apply for planning permission/consent as described in this form and the accompanying plans/drawings and additional information. I/we confirm that, to the best of my/our knowledge, any facts stated are true and accurate and any opinions given are the genuine opinions of the person(s) giving them.
☐ Date 14/06/2018
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38e0046b2d5e26ef7568b55dd11496a420f88888 | Topclose Farm, Macclesfield
Building Inspection Report for Bat Roosting Potential
Report drafted by: Sophie Warnock (Natural England Level 1 Survey Licence 2016-24354-CLS-CLS)
Supervisor: Neil Lee-Gallon (Natural England Level II Survey Licence 2015-10739-CLS-CLS) Title: Topclose Farm, Macclesfield Building Inspection Report for Bat Roosting Potential
Client: Dominic Farley
Date: December 2017
| Status | Date | Prepared by | Reviewed by | Approved by | |--------|--------|----------------------|----------------------|----------------------| | V1 | 14/12/17 | Sophie Warnock | Kelly MacGillivray | Kelly MacGillivray | | | | Assistant Ecologist | Ecologist | Ecologist | | V2 | | | | | | Final | | | | |
NLG Ecology Ltd has prepared this report for the sole use of the client, showing reasonable skill and care, for the intended purposes as stated in the agreement under which this work was completed. The report may not be relied upon by any other party without the agreement of the client and NLG Ecology Ltd. No other warranty, expressed or implied, is made as to the professional advice included in this report.
Data supplied by the client or from other sources have been used, it has been assumed that the information is correct. No responsibility can be accepted by NLG for inaccuracies in the data supplied by any other party. The conclusions and recommendations in this report are based on the assumption that all relevant information has been supplied by those bodies from whom it was requested.
Where field investigations have been carried out, these have been restricted to a level of detail required to achieve the stated objectives of the work. This work has been undertaken in accordance with the quality management system of NLG Ecology Ltd. No part of this report may be copied or duplicated without the express permission of NLG Ecology Ltd and the party for whom it was prepared. SUMMARY
NLG Ecology Ltd (NLG) was commissioned by Dominic Farley in September 2017 to undertake a building inspection/assessment for bat roosting potential of the barns at Topclose Farm, off Clarke Road, Macclesfield, SK11 0ND. The site is shown as Figure 1 (Appendix 1) and is centred on National Grid Reference SJ954719.
Mr Farley is seeking planning permission to convert the existing building (Barn 1 as shown in Figure 1) into a dwelling.
The survey aimed to determine the potential presence of bats roosting within the building subject to the proposals (Barn 1). Following the detailed inspection, Barn 1 has been confirmed as a roost for brown long-eared bats (*Plecotus auritus*). The species was confirmed by bat dropping DNA analysis. A large quantity of droppings (approximately 150) and feeding evidence (approximately 80 prey remains) were scattered throughout the top floor/hayloft of the barn, with the main roosting area (indicated by the volume of droppings and feeding remains) located within the gap above the south-western wall plate. The point(s) of access used by the bats is currently unknown - due to the height of the building, not all gaps could be thoroughly inspected, however a number of gaps were identified as potential access points. The building’s exterior also offers a number of high potential roosting opportunities to crevice dwelling bats, such as gaps beneath the lifted roof and ridge tiles.
In light of the barn’s confirmed use by bats in addition to further high roosting potential for both free hanging and crevice-dwelling bat species throughout the year, and in accordance with best practice guidelines (Collins 2016), three emergence/re-entry surveys are recommended to be undertaken between May and August inclusive. Although considered low risk, a hibernation inspection will be carried out with the aid of an endoscope and high powered torch to inspect all of the internal crevices. This was carried out at during the hibernation period on the 14th December 2017. Upon inspection, no bats were seen to be roosting within the building at this time, therefore confirming that the building is not being used for hibernation.
The barn should ideally remain unswept so as to allow for any accumulation of evidence that may contribute towards, and enhance, the other methods of data collection (e.g. species identification and any regular roosting spots). Further information is provided in the Conclusions and Recommendations section.
The data within this report are valid for 18 months from the date of the inspection i.e. until March 20th 2019.
# CONTENTS
1 INTRODUCTION .................................................................................................................. 2\
1.1 Background .................................................................................................................. 2\
1.2 Bat Biology .................................................................................................................. 2\
2 METHODOLOGY .............................................................................................................. 3\
2.1 Desk Study .................................................................................................................. 3\
2.2 Building Assessments ................................................................................................. 4\
3 SURVEY FINDINGS .......................................................................................................... 5\
3.1 Desk Study .................................................................................................................. 5\
3.2 Building Assessments ................................................................................................. 6\
4 CONCLUSION AND RECOMMENDATIONS .................................................................. 10\
5 REFERENCES .................................................................................................................... 11\
APPENDICES ...................................................................................................................... 12\
Appendix 1 - Figures and Photographic Plates .................................................................. 12\
Appendix 2 - Legislation .................................................................................................... 22\
Appendix 3 - Bat Dropping DNA Analysis ........................................................................ 23 1 INTRODUCTION
1.1 Background
1.1.1 NLG Ecology Ltd (NLG) was commissioned by Dominic Farley in September 2017 to undertake a bat inspection/assessment of the barns at Topclose Farm, off Clarke Road, Macclesfield, SK11 0ND. The site is shown as Figure 1 (Appendix 1) and is centred on National Grid Reference SJ954719.
1.1.2 Mr. Farley is seeking planning permission to convert the existing barn (Barn 1, as indicated in Figure 1) into a habitable dwelling.
1.1.3 The inspection was undertaken by Sophie Warnock, Natural England Class Level 1 bat licensed surveyor (2016-24354-CLS-CLS) on the 20th September 2017.
1.1.4 Relevant legislations that have informed survey effort are detailed in Appendix 2. Note that the text provides a brief summary of the legislation in relation to bats in England and Wales and the original Acts, Regulations and any amendments should be referred to for the precise wording.
1.2 Bat Biology
1.2.1 Within the British Isles there are 17 resident (i.e. breed) species of bat. Bats are nocturnal and feed entirely on insects. They use echolocation, a complex sonar system, to navigate around their surroundings and to forage.
1.2.2 Depending on the species of bat, habitat requirements vary widely although features such as traditional pasture, woodland edges, parkland, and wetland are particularly good for bats as insects are abundant within these areas (Mitchell-Jones 2004). Linear features such as hedgerows, tree lines and watercourses are important for commuting as they assist navigation.
1.2.3 Bats utilise different roosts at different times of the year, and roost requirements vary between species. Typical roost sites include caves, mines, trees, and buildings. Bats hibernate between October and March and usually within a damp, unexposed roost which can maintain a relatively stable temperature such as caves, cellars, mines. Around March bats emerge from hibernation and gradually move to their summer roosts and during spring females gather together to form maternity colonies to give birth and rear their young. Summer and maternity roosts are typically found within man-made structures or suitable crevices in trees.
1.2.4 Birthing usually occurs late June – mid July, with the young able to fly within three to five weeks (Altringham 2003). By the end of August, most of the young bats are independent and the colony begins to break up. Mating takes place between August and December either at autumn swarming sites or winter hibernation sites. Bat roost sizes can vary from individual bats found within summer roosts, to hundreds of bats found within maternity colonies or hibernation sites. 2 METHODOLOGY
2.1 Desk Study
2.1.1 A desk study provides background information on the ecological interest of a site and complements data collected in the field by providing ecological context for the site and its wider landscape. The search area extended up to 1km and incorporated the following resources:
- Multi-Agency Geographic Information for the Countryside (MAGIC) [www.magic.gov.uk](http://www.magic.gov.uk) was searched for European and National Statutory designated sites, to identify designations with criteria for bats;
- The National Biodiversity Network (NBN) Atlas ([https://nbnatlas.org/](https://nbnatlas.org/)) was consulted for bat records, both field and roost; and
- Google Maps ([www.google.co.uk/maps](http://www.google.co.uk/maps)) were reviewed to help provide wider site context in respect of bat commuting. i.e. the presence of a continuous network of surrounding hedgerows may support findings drawn from field surveys.
2.2 Building Assessment
2.2.1 The building assessment adhered to guidance within the Bat Mitigation Guidelines (Mitchell-Jones 2004) and the Bat Surveys Good Practice Guidelines (Collins 2016) and involved a detailed external and internal inspection of the building. Equipment used to support the assessment included close-focusing binoculars, high powered torches and ladders to aid access.
2.2.2 Externally, the roof, walls, and any fascia boards and associated voids and gaps were inspected for evidence of use by bats. This evidence includes staining and scratch marks around potential roost entrance points, bat droppings, and feeding remains. The buildings were also assessed for their potential to provide suitable roosting conditions for bats.
2.2.3 Internally, where safe and accessible to do so, the internal building spaces were inspected for evidence of bats in the form of bat droppings and feeding remains (e.g. moth and butterfly wings), staining on crevices by fur oils or urine, as well as the bats themselves. Potential bat access points can include gaps within brick-work, tiles or mortar and voids under felt.
2.2.4 Each building was assigned a value for its bat roost potential, as described in Table 2.1 and adapted from Collins (2016).
Table 2.1: Visual Assessment Criteria for Buildings
| Suitability | Description of Roosting Habitats | Commuting and Foraging Habitats | |-------------|----------------------------------|---------------------------------| | Negligible | Negligible habitat features on site likely to be used by roosting bats. | Negligible habitat features on site likely to be used by commuting or foraging bats. | | Low | A structure with one or more potential roost sites that could be used by individual bats opportunistically. However, these potential roost sites do not provide enough space, shelter, protection, appropriate conditions and/or suitable surrounding habitat to be | Habitats that could be used by small numbers of commuting bats, such as gappy hedgerow or unvegetated stream, but isolated (i.e. not very well connected to the surrounding landscape by other habitat). Suitable, but isolated, habitat that could be used by small numbers of foraging bats such as a lone tree | | Level | Description | Example | |-------|-------------|---------| | Low | Used on a regular basis or by larger numbers of bats (i.e. unlikely to be suitable for maternity or hibernation). A tree of sufficient size and age to contain PRFs but none seen from the ground, or, features seen with only very limited roosting potential. | (not in a parkland situation) or a patch of scrub. | | Moderate | A structure or tree with one or more potential roost sites that could be used by bats due to their size, shelter, protection, condition and surrounding habitat but unlikely to support a roost type of high conservation status. | Continuous habitat connected to the wider landscape, such as lines of trees and scrub or linked gardens that could be used by bats for commuting. Habitat that is connected to the wider landscape, e.g. trees, scrub, grassland and water, and could be used by bats for foraging. | | High | A structure or tree with one or more potential roost sites that are obviously suitable for use by larger numbers of bats on a more regular basis and potentially for longer periods of time due to their size, shelter, protection, conditions and surrounding habitat. | Continuous high quality habitat such as river valleys, streams, hedgerows, lines of trees and woodland edges, that is well connected to the wider landscape and likely to be used regularly by commuting bats. High quality habitat that is well-connected to the wider landscape such as broadleaved woodland, tree-lined watercourses and grazed parkland, that is likely to be used regularly by foraging bats. Site is close to, and connected to, known roosts. | 3 SURVEY FINDINGS
3.1 Desk Study
3.1.1 Topclose farm is situated at the edge of Macclesfield forest which is to the east and south and agricultural land is present to the north and west. The closest watercourse to the farm is the Bollin Brook situated approximately 50m to the south and two issues are present approximately 895m south and 500m west. Several reservoirs are present within 1km of the farm; Rigegate Reservoir approximately 560m south, Teggsnose Reservoir approximately 680m west, Bottoms Reservoir approximately 800m west and Trentabank Reservoir approximately 840m south-east. Approximately 205m from the site a well is present.
3.1.2 The MAGIC website (http://magic.defra.gov.uk/MagicMap.aspx) was reviewed to establish the locations of any near-by designated sites and/or Biodiversity Action Plan (BAP) priority habitats. The site is located within a Site of Special Scientific Interest (SSSI) Impact Risk Zones, is part of a less favoured area of England and is within the Peak District National Park. The site is also approximately 125m west from a Green Belt area under the Macclesfield Borough Local Plan. It is not envisaged that the works will impact upon this designation.
3.1.3 Several BAP priority habitats are located within 1km of the farm including deciduous woodland approximately 385m south, 455m west and 760m south, area of no main habitat but additional habitat exists approximately 400m west, lowland heathland approximately 490m west and 900m west, lowland dry acid grassland approximately 775m north-west and 940m north-west, upland heathland approximately 645m north-west and 655m north-west and an area of good quality semi-improved grassland (Non Priority) approximately 720m north. An area of ancient woodland is also situated approximately 570m west. Many habitats in the surrounding area are classified as different types of woodland on the National Forest Inventory including conifer habitat approximately 185m east, young trees approximately 183m east and 365m south-west, mixed mainly broad leaves approximately 700m south-east, assumed woodland approximately 305m north-east and broadleaved approximately 385m south, 455m west, 760m south, 530m east and 815m east. It is not envisaged that the works will impact upon these habitats.
3.1.4 No European Protected Species Mitigation (EPSM) licences have been issued within 1km of the site. Brown long-eared bats (Plecotus auritus) have previously been recorded within 1km of the site using NBN Atlas. 3.4 Building Assessments
Barn 1 – Confirmed Roost
External
3.4.1 The predominant focus of the inspection was on Barn 1, which is currently the only building on site to be converted into a habitable dwelling. At present the building is empty however previously used as stables for horses (an overview of the barn can be seen in photographs 3 and 5). The building is a traditional agricultural barn, comprising of stone and mortar external walls, gable ends to the northeast and southwest, and pitched tiled roof. The walls are in good condition with no areas of cracked mortar or stonework. Purpose built gaps in the stone walls exist (likely from when the barn was used for livestock/agricultural storage) on the southeast and northwest walls that have now been blocked with various materials including glass windows, wire mesh, brick and pieces of wood.
3.4.2 The gable ends have wooden barge boards, which are approximately gapped by 100mm from the supporting wall - this is considered to be too wide and exposed a feature for bat roosting. Below the rakes and just above the barge boards on both of the building’s gables, slightly gapped areas have been identified where mortar has broken away, measuring at approximately 10-15mm wide and therefore considered to be suitably sized for bat access. It is unclear whether the gaps allow access to the interior - due to the high elevation, a thorough inspection of the feature could not be carried out; however, as no daylight could be seen when looking internally it is assumed that this area is possibly sealed.
3.4.3 Two small gaps were identified within the brickwork beneath the apexes on the north-east and south-west gables. The gaps are directly above the ridge board, which could potentially provide points of access to the barn’s interior and what is considered to be a favoured roosting area for some bat species. Again, a thorough inspection of these features could not be carried out due to height restrictions.
3.4.4 The roof is constructed of large, heavy stone tiles and stone ridge tiles. A number of lifted and gapped tiles are present on both roof slopes, and with the tiles being large, a generous overlap is created between them, which could offer ample roosting opportunities to bats. Similarly, a number of the ridge tiles are lifted and gapped, offering roosting opportunities beneath the tiles with potentially further access into the interior of the building. No soffit boxes or fascia boards are present on the north and south elevations; however the joists are exposed at the eaves. Each joist is well mortared and does not offer any points of access or roosting opportunities.
3.4.5 The building has been categorised as a confirmed brown long-eared (Plecotus auritus) bat roost, and also has high potential features to accommodate crevice dwelling bat species.
Internal
3.4.6 The building’s ground floor interior is separated into three rooms, one of which is divided from the main building and is accessible by an external door. This room does not offer any roosting opportunities due to its lack of internal features and lack of potential bat access points from the exterior (Photograph 6). The other two rooms are connected to the rest of the building via an open stairway. Wooden joists support the wooden slatted ceilings within both of the ground floor rooms. The small alcoves that have been created by this ceiling design offer a number of potential tucked away roosting locations, and the two ground floor rooms during the daytime are relatively dark and secluded, therefore considered to provide optimal conditions for roosting bats. One bat dropping and one tortoiseshell butterfly wing was found within the ground floor room closest to the stairs. One hirundine nest (suspected to be that of swallow Hirundo rustica) was also identified within the room closest to the stairs (Photograph 19). 3.4.7 The first floor of Barn 1 is a large hayloft (Photograph 7). The interior of the roof is lined with wooden cladding, with associated supporting wooden ridge board, purlins and king post truss. Along the ridge are a number of areas where the wooden cladding is not present, therefore exposing the exterior ridge tiles. As previously mentioned, some of the ridge tiles are lifted and gapped, therefore creating direct points of potential access below. Daylight ingress can be seen through these areas therefore highlighting access potential to bats (Photograph 11 and 12).
3.4.8 The walls of the northwest and southeast elevations are single skin. The walls and mortar are in good condition with minimal cracked areas present - any small mortar cracks that were identified are considered to be superficial. Purpose-built gaps in the stone walls exist, likely from when the agricultural barn was in active use. The gaps have been partially blocked with different materials including glass windows, wire mesh, bricks and bits of wood. Most of the gaps have been well-sealed with this method, however two gaps in particular present potentially accessible areas where the mesh has slightly broken away (Photograph 14), and where the bits of wood and brick have been placed in a way that does not entirely block the gap; therefore, smaller gaps have been created and are considered to be suitable points of access for bats (Photograph 13).
3.4.9 Windows are present on the southwest, northwest and northeast elevations and small cavities have been identified behind the wooden lintels (Photograph 15). No signs of bat use were observed beneath these window features during the first inspection, therefore it is considered unlikely that bats are using the cavities for roosting at present however future or occasional use is possible.
3.4.10 The gable walls are double skin with the interior wall being of breeze block construction. The top of breeze block wall plate on both of the gable walls does not meet the roof, which has created crevices at the top of, and between, the wall plates (Photographs 9 and 10). The crevices could not be inspected due to the excessive height, however a collection of droppings (approximately 20) have accumulated below and around the ridge board on the southwest gable wall (Photograph 8) indicating bat roosting within and around this area. With regards to other internal roosting locations, the hayloft is relatively sunlit during the day (apparent during the day time internal inspection) from the windows present to the southwest, northwest and northeast (this can be seen in photograph 7), however signs of bat roosting are prevalent throughout the hayloft (approximately 80 butterfly wings and approximately 150 droppings). Favoured areas for roosting have been identified along the eaves to the northwest and some sections to the south-west along the ridge board, predominantly centrally (Photographs 16 and 17).
3.4.11 From the evidence collected, it appears that the core roosting location is behind the wall plate on the southwest gable wall. It is apparent that the bats utilise the rest of the hayloft based on the droppings and feeding remains found, likely for night roosting/feeding and possibly occasional day roosting in the darker corners. 4 CONCLUSION AND RECOMMENDATIONS
4.1 Barn 1 at Topclose Farm, at present, is the only building subject to renovation proposals. Following the detailed internal and external inspection carried out, and based on the evidence of bat use observed and/or collected (DNA analysis, droppings and feeding evidence), Barn 1 has been categorised as a ‘confirmed roost’ to brown long-eared bats. No bats were observed within the barn during the inspection and feeding/night roosting use is suspected, however a number of crevices exist internally as previously mentioned, offering suitable day roosting locations during the summer and potentially for hibernation.
4.2 As the conversion works will impact roosting bats, in line with both good practice guidance and the law, further surveys for bats are recommended. These are summarised as follows:
- Three dusk emergence/dawn re-entry surveys to be undertaken between May and August inclusive; and
- A hibernation inspection to be carried out during the winter months to inspect all of the internal crevices with the aid of an endoscope and high powered torch to identify presence/absence of hibernating bats.
4.3 The barn should remain unswept so as to allow for any accumulation of evidence that may contribute towards, and enhance, the other methods of data collection (e.g. species identification and any regular roosting spots). Any existing access points (for example, any windows that are permanently left open) should also be left as they normally are and remain unobstructed. The data collected would contribute towards the application for a mitigation licence from Natural England.
4.4 As roosting bat use of the barn subject to renovation proposals (Barn 1) has been confirmed, a European Protected Species Mitigation (EPSM) licence application to Natural England will be required to allow the lawful destruction of any roosts. The data collected during the recommended surveys are a vital part of this application and allow species, numbers and roost types to be confirmed, which will in turn inform an appropriate level and style of mitigation to ensure that the species’ favourable conservation status is maintained at the site. The licence application would need to include a detailed mitigation plan based on the survey findings (e.g. tailored to species, roost type etc. and including timing constraints and any works requiring ecological supervision). Details of post-development monitoring may also need to be included (dependent on the data collected) to assess the success of the replacement features for roosting bats and to satisfy Natural England that appropriate commitment to the conservation of EPS (bats) has been adopted for the site. Once submitted, an application takes at least 30 working days to process, depending on Natural England’s workload.
4.5 The hibernation check was carried out on the 14th December 2017, by Sophie Warnock and Megan Williams. No bats were identified within the known roosting locations, where extensive droppings have accumulated over time and as indicated in the photographs below. This therefore confirms that the building is not being used for hibernation.
Nesting birds
4.6 Opportunities for nesting birds are available (and evident) within Barn 1. Any works required should be undertaken outside the main bird nesting season, which runs from March to August inclusive. Should works to the barn interiors be required during the nesting season then an ecologist should carry out a check for active nests no more than 48 hours in advance of the commencement of works. If active nests, nests under construction or young birds that have not fledged the nest are present, then a species-specific exclusion zone will be required around the nest. Works can then only proceed once the ecologist has confirmed that the young have fledged. 5 REFERENCES
Altrincham, J. D. 2003. British Bats. London, Harper Collins Publishers
Collins, J, (ed.) (2016). Bat Survey for Professional Ecologists: Good Practice Guidelines (3rd Edition), Bat Conservation Trust, London.
Mitchell-Jones, A.J, (2004). Bat Mitigation Guidelines. English Nature, Peterborough. APPENDICES
3.5 Appendix 1 - Figures and Photographic Plates
Figure 1 – Site Location
Figure 2 Photographic Plates (Barn 1)
Photograph 1 - The northeast gable end
Photograph 2 - Small gap in stone work just above the wooden ridge board
Photograph 3 – An overview of the barn, the northwest elevation
Photograph 4 – Roosting opportunities beneath lifted tiles Photograph 5 – An overview of the barn, the south-east elevation
Photograph 6 – The segregated room on the ground floor
Photograph 7 – The first floor hayloft
Photograph 8 – A collection of droppings below the internal apex of the southwest wall Photograph 9 – Gap above the gable wall plate
Photograph 10 – Gap above the gable wall plate on the northeast elevation
Photograph 11 – Gaps beneath outer ridge tiles, which are exposed internally
Photograph 12 – One of the identified gaps associated with this feature Photograph 13 – A purpose built hole in the stone work which has been partially blocked using pieces of book and brick, a few of the identified gapped areas have been highlighted
Photograph 14 – Another purpose built hole in the stone work which has been partially blocked with wire mesh, an identified gap has been highlighted
Photograph 15 – Crevice behind the window lintels
Photograph 16 – Feeding evidence (butterfly wings) Photograph 17 – Feeding evidence (butterfly wings)
Photograph 18 – The ground floor room closest to the stairs
Photograph 19 – Hirundine nest located in the ground floor room closest to the stairs 3.6 Appendix 2 – Legislation
Bats
All UK bat species receive full protection (Schedule 5 species) under the Wildlife and Countryside Act 1981, which is further amended by the Countryside and Rights of Way Act 2000 and the Conservation of Habitats and Species Regulations 2010. Taking these Acts together, it is an offence to:
- Intentionally or recklessly disturb a bat while it is occupying a structure or place which it uses for shelter or protection (S9:4b).
- Intentionally or recklessly obstruct access to any structure or place used for shelter or protection by a bat (S9:4c).
- The term ‘reckless’ is defined by the case of Regina v Caldwell 1982. The prosecution has to show that a person either deliberately took an unacceptable risk, or failed to notice or consider an obvious risk.
A bat roost has been interpreted to mean any structure or place which is used for shelter or protection whether or not bats are present at the time. Bat roosts may be defined (Hunt, L, 2012) as either (i) Transition Roosts, (ii) Maternity roosts, (iii) Satellite Roosts, (iv) Mating Roost, (v) Hibernation roosts, (vi) Night Roost, (vii) Day Roost, (viii) Feeding Roost or (ix) Swarming Sites.
Bats are listed under Annexes IIa and IVa of the EC Directive on the Conservation of Natural Habitats and of Wild Fauna and Flora, or the ‘Habitats Directive’. Inclusion on Annex IVa means bats are a European Protected Species (EPS) and protected under the Conservation of Habitats and Species Regulations 2010, thus it is an offence to:
(a) Deliberately capture, injure or kill any wild animal of an EPS,
(b) Deliberately disturb wild animals of any such species, in such a way as –
- (i) to impair their ability to survive, to breed or reproduce, or to rear their young, or
- (ii) in the case of animals of a hibernating or migratory species, to hibernate or migrate, or
- (iii) to affect significantly the local distribution or abundance of the species to which they belong;
A licence to disturb or take bats can be issued for certain purposes under Section 16 of the Wildlife and Countryside Act 1981 and under Regulation 44 of the Conservation of Habitats and Species Regulations 2010 permitting activities that would otherwise be illegal under the legislation. Licences can take up to thirty working days to be issued by Natural England. Where impacts on bats are unavoidable, mitigation will be required to maintain and enhance the favourable conservation status of bats. Losses of bat roosts must be compensated for by the provision of new roosting sites and planting of new foraging habitat. Mitigation measures will need to be designed on a site specific basis and only in consultation with an expert. All mitigation proposals must be agreed with Natural England and put in place prior to the commencement of works. Breeding Birds
Under the Wildlife and Countryside Act 1981 (as amended) all wild birds, their nests and eggs are protected by law and it is an offence to;
- Intentionally kill, injure or take any wild bird
- Intentionally take, damage or destroy the nest of any wild bird while it is in use or being built
- Intentionally take or destroy the egg of any wild bird. Appendix 3 – Bat Dropping DNA Analysis
9 October 17
Re: Identification Results for Sophie Warnock, NLG Ecology Ltd
Job number 10800, received 26 September 2017 Sample labelled: Top Close Farm Barn 1 PCR amplification successful, DNA sequence: ATGACCAACATTGAAAGTCCACCCCTCTCATATAAAATATCAATGATTCTATTGATT CTTACCTGCTCCCTCAATATTTCTCATGTTGAAACTTTGGGTCTTCTAGGTATT GCC
Phylogenetic analysis identification: Plecotus auritus
Confirmed by maximum likelihood, maximum parsimony, bootstrap 100%.
Best regards,
Professor Robin Allaby
The results and conclusions in this report are based on an investigation of mtDNA sequence analysis. The results obtained have been reported with accuracy. The interpretation represents the most probable conclusion for the DNA sequence obtained rather than the sample provided given current levels of species data. It should be borne in mind that different circumstances might produce different results. Therefore, care must be taken with interpretation of the results especially if they are used as the basis for commercial recommendations.
Professor Robin Allaby School of Life Sciences, Gilbert Hill Campus, University of Warwick, Coventry CV4 7AL, Tel: 02476575059 Fax: 02476574002 Email: [email protected]
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8b5fb58cf839ed2622ec204ddc2bf51f2dca968a | The Disproportionality Project: Addressing issues relating to the disproportionately high representation of Islington’s and Haringey’s BAME young people in the Criminal Justice System
An Evaluation Report by the Centre for City Criminology, City, University of London May 2020 The Disproportionality Project: Addressing issues relating to the disproportionately high representation of Islington’s and Haringey’s BAME young people in the Criminal Justice System
A Evaluation Report by the Centre for City Criminology, City, University of London Greer, C., Rosbrook-Thompson, J., Armstrong, G. (2020) The Disproportionality Project: Addressing issues relating to the disproportionately high representation of Islington’s and Haringey’s BAME young people in the Criminal Justice System, Centre for City Criminology: City, University of London.
Foreword by Curtis Ashton Acting Director, Youth and Community, London Borough of Islington
May 2020 Executive Summary
This report presents the findings and recommendations from the second partnership project involving Islington Borough Council and criminologists at City, University of London. The first project, *Enhancing the work of the Islington Integrated Gangs Team*, was published in 2019. This second project involved evaluating a programme designed to tackle key issues and outcomes relating to the disproportionate representation of Black, Asian and minority ethnic (BAME) young people in the Criminal Justice System and beyond.
The programme was attended by multiple agencies from two London Boroughs – Islington and Haringey – and sought to strengthen the multi-agency approach to addressing disproportionality. Attendees from Islington included Youth Services, Youth Offending Services and the Integrated Gangs Team. Attendees from Haringey included Youth Justice Service, Early Help and Youth Service. Police and Probation officers also attended sessions.
Members of the research team attended all of the practitioner workshops, which took place between August and November 2019. Interviews with a cross-section of the frontline practitioners who attended workshops were conducted at YOS sites in Islington and Haringey, respectively, in late 2019. A number of parents’ workshops, which took place at neutral venues, were voice recorded for the purposes of evaluating the project and identifying parents’ lived experiences with regard to disproportionality. Finally, young people engaged in the Criminal Justice System were interviewed at YOS sites with a view to capturing their experiences of criminal offending and victimisation, discrimination and disproportionality.
The research team evaluated the delivery, outputs and, where possible, outcomes of the Disproportionality Project. The recommendations are listed below. Recommendations
01. Structure and Approach In any future disproportionality programme involving staff training, consider using full-day rather than half-day sessions, move ice-breaker activities to after the session outline, specify the cumulative nature of learning from session to session, and incorporate ‘learning into practice’ action planning after each session.
02. Dissemination Disseminate this project’s key findings regarding the challenges and obstacles faced by young people and parents to relevant staff members, including senior leaders, and beyond.
03. Use of academic research Make fuller use of key social science research insights into implicit bias and the transmission of discrimination, particularly as these relate to race and ethnicity, in future iterations of the programme.
04. Young People’s and Parental engagement Continue capturing the voice of young people in relation to disproportionality and consider offering a more extensive programme of parents’ forums, including parent-practitioner sessions moderated by a third party.
05. Being responsive to local factors Combine ad hoc forums in response to specific incidents and events with more regular outreach programmes that both draw on and share expertise from relevant services.
06. Review the safety and risk implications of YOS procedures Consider whether the routinisation of young people’s movements created by YOS procedures/protocols may increase risk of harm.
07. Reporting on and scrutinising disproportionate court outcomes Explore the possibility of compiling regular reports for local courts detailing disproportionate outcomes for BAME young people from Haringey and Islington – particularly remand and custodial sentences – and introducing an annual or biannual scrutiny panel, including local court representation, to scrutinise those reports.
08. Replicating an action-orientated training focus Prioritise the identification and dissemination of good practice, which can have an immediate impact on practitioners’ day-to-day work, in future iterations of the programme.
09. Boosting parental trust and engagement Consider strengthening whole-family working practices and models, including the creation of parenting worker roles where these do not already exist.
10. Increasing accountability for school exclusions Consider identifying and collating longer-term outcomes for excluded BAME young people, and disseminating this information on a school-by-school basis.
11. Police relations with young people Police Borough Command Units should continue working to strengthen relations with BAME young people. Issues for Future Research
Future research should:
1. Engage with young people and their families / carers in greater depth to understand better the complex interdependencies of serious youth violence (SYV) and enhance the local multi-agency approach to addressing it.
2. Examine the role of ‘county lines’ as a contributor to gang affiliation and SYV in Islington and Haringey.
3. Co-produce with Islington, Haringey and community partners an inclusive, sustainable and citizen-centric research agenda to address disproportionality and wider inequalities, and contribute value to people’s lives. Foreword
All children and young people in our society are equally important. They need to be valued, nurtured and provided with the support that they need to thrive and achieve their fullest potential. However, we know that some cohorts of children and young people are more likely to be disadvantaged and to experience poorer short-term and long-term outcomes. These inequalities, which exist in various areas and systems, have been well-documented for some time. This report explores inequalities in relation to the youth and criminal justice arena and interdependent systems where Black, Asian and Minority Ethnic (BAME) young people are overrepresented. In Islington and Haringey, this is particularly applicable to Black groups and to Black males in particular. With support from the Youth Justice Board, both Boroughs decided to develop a project which would help to identify, address and tackle the reasons why this disproportionality is so prevalent.
One of the main areas where young BAME are over-represented is the secure estate. This is particularly worrying as outcomes for children who have been sentenced to custody are significantly worsened. At the beginning of the unprecedented pandemic in March 2020, when we were devising arrangements to ensure that we could continue to support our children during 'lockdown', one of my YOS caseworkers mentioned that one of her young people (K) had shared some very frank thoughts about being a young Black man in today’s society. His words and feelings, which he has given permission to use here, are so powerful that they say all that needs to be said about the need to tackle disproportionality and discrimination.
K – my thoughts of being in custody
I feel like I’m another Black male in the system. Also known as a statistic.
Being Black and in custody, I feel like my voice is less heard because there are so many Black males in the system, and we’re all judged and looked at the same.
This is having an impact on my emotional and mental well-being.
I feel angry, and then I’m viewed as an angry Black male in the system (statistic).
I feel my opinion is disregarded when my charge and colour of skin is taken into consideration. The reason why I believe this is because there are so many Black males of similar backgrounds and of similar charges.
I’m not oblivious to the fact that there are Black males who are guilty of their crimes. However, this should not have an impact on all Black males because some of us are caught in this unjust system.
Thanks to Chris Greer, James Rosbrook-Thompson and Gary Armstrong for producing this report. In Islington, thanks to Angela Wilson, Marcus Miller and Valejia Komar for helping to develop ideas for this project, and to Councillor Kaya Comer Schwartz, Catherine Briody and Karolina Bober. Thanks to Linzi Roberts-Egan and Carmel Littleton for pushing equalities matters. In Haringey, thanks to Matthew Knights for helping coordinate, and to Ann Graham and Councillor Mark Blake. Thanks to Anthony Scott, Rebecca Smith and Donna Murray-Turner from AIM High. Thanks to Liz Westlund, Charlie Taylor, Natasha Richards, Dominic Daley, Harriet Casey, Sarah Brimelow and Colin Allars at the Youth Justice Board. And a huge thank you to K for allowing his YOS caseworker L to write up his thoughts and share them with us for this Foreword.
Curtis Ashton, Acting Director, Youth and Community, London Borough of Islington. Introduction
This evaluation is the second project from an ongoing partnership between Islington Borough Council and criminologists at City, University of London. In late 2017, Criminologists at the Centre for City Criminology invited Islington practitioners, mostly attached to the Integrated Gangs Team (IGT) and the Metropolitan Police Service (MPS), to the University to discuss existing research on serious youth violence (SYV), the current situation in Islington, and the practices of and challenges faced by the IGT. This initial event resulted in a series of discussions around how City Criminologists might add value to the work of the IGT by conducting a short research project. The resulting report, Enhancing the work of the Islington Integrated Gangs Team, was published in 2019.¹
In the summer of 2019, City Criminologists were approached by the same Islington Borough Council partners with an invitation to engage in further partnership working. This second project involved evaluating a programme designed to tackle key issues and outcomes relating to the disproportionate representation of Black, Asian and minority ethnic (BAME) young people in the Criminal Justice System and beyond. Geographically focussed in Islington and Haringey, the programme sought specifically to:
...improve awareness and the capacity of staff working with young people in Islington to address the issues around the disproportionately high numbers of Black, Asian and minority ethnic (BAME) offenders and the poor outcomes they face in the Criminal Justice System that have been drawn to the attention of successive governments, voluntary and public sector agencies for decades. This will be achieved by training for staff working with young people in Islington and a capacity building and engagement programme to parents and carers in local communities from BAME backgrounds.
A set of four service aims were defined accordingly. These were:
1. To provide training around Adverse Childhood Experiences within BAME communities. Training for staff will highlight cultural and community competence, staff conscious and unconscious bias and a return to an understanding of institutional racism and how it impacts on individuals and communities.
2. Setting up an initiative whereby parents from BAME backgrounds have a safe space to discuss the pressures associated with their children’s involvement in ASB and/or offending behaviour and the structural and societal pressures they face. These support forums, ‘safe spaces’ with no Local Authority Staff present, will be utilised to raise and resolve issues as they experience them.
3. It is hoped the service covered by this specification will help to better support young people and their families from the poor outcomes and lack of opportunity which unfortunately, is more prevalent in BAME individuals and families.
4. This intervention ultimately is about strengthening communities who have been marginalized. This intervention will look at disproportionality at a local level. Supporting the community from a cultural approach, where experiences are shared, will strengthen the community. It will also influence Islington and Haringey to shape and improve the services provided, so that young people and their families are supported to (improve outcomes and opportunities so they can) ‘live their best life’.
¹ Greer, C., Rosbrook-Thompson, J., Armstrong, G., Ilan, J., McLaughlin, E., Myers, C., Rojek, C. and Taylor, E. (2019) Enhancing the Work of the Islington Integrated Gangs Team: A Pilot Study on the Response to Serious Youth Violence in Islington, Centre for City Criminology: City, University of London. http://repository.essex.ac.uk/27442/1/2019-04%20-%20IGT%20Report%20FINAL.pdf The programme was delivered by Anthony Scott, Rebecca Smith and Donna Murray-Turner of the charity AIM High following a formal procurement and commissioning process which was led by Islington Council.
Anthony Scott, Project Lead, is a qualified counsellor/psychotherapist with 17 years’ experience of face-to-face work with young people, families, communities in both statutory and voluntary services. He has extensive experience of working with young people at risk of offending, serious youth violence, and in the design and delivery of training which is respectful, truthful and challenging. Anthony is also an Assistant Trainer for the Anna Freud Centre’s AMBIT programme and an experienced trainer in the Strengthening Families, Strengthening Communities parenting programme.
Rebecca Smith qualified as a Probation Officer in 2001 and has since worked with adults and more recently young people in the criminal justice system. For the last five years, she has coordinated the Ending Gang & Youth Violence (EGYV) Team for Wandsworth Youth Offending Team. The EGYV Team targets gang-affected young men up to the age of 25. During her career Rebecca has also specialised in developing interventions and training packages. She is currently employed by the Anna Freud Centre as a Lead Trainer in the Ambit approach – a psychologically informed model that supports work with the most complex and hard-to-reach young people and families.
Donna Murray-Turner is a qualified social worker who has extensive experience of community engagement. Donna founded Another Night Of Sisterhood (ANOS), a Croydon-based community interest company that specialises in community engagement through creating safe spaces for communities to come together, express their voices and access support. They have a specific focus on supporting marginalised communities to change negative narratives. Donna has recently featured on a number of high-profile campaigns highlighting the importance of community engagement.
The Evaluation and Report Structure
This report is based on visits to key sites related to the Disproportionality Programme and the lives/needs of its user groups, observing work, conducting in-depth interviews with identified individuals and/or groups, and reviewing relevant documentation. The semi-structured nature of the interview process created a flexible space from which a range of salient topics emerged.
The report contains the following elements:
• A review of the relevant literature on disproportionality, including academic studies and landmark policy documents at national and local level.
• A brief quantitative analysis of Participant Evaluation Sheets and an online survey completed by Haringey and Islington practitioners.
• Analysis based on observation of practitioner workshops.
• Analysis based on observation of parents’ sessions.
• A brief assessment of the programme in relation to the Service Aims identified in the Grant Agreement and Specification document.
• An assessment of the programme in relation to the expected Service Outcomes identified in the Grant Agreement and Specification document.
• Analysis based on interviews with practitioners, parents and young people.
• A series of recommendations based on the report’s findings and analysis. Literature Review
Though the issue of disproportionality along ethno-racial lines has only recently entered mainstream political debate in the UK – largely as a result of 2017’s Lammy Review (see below) – systematic studies of disproportionality have been conducted in the United States for forty years. In 1982, American criminologist Alfred Blumstein lamented what he called ‘grossly disproportionate race-specific incarceration rates’, seeking an explanation for the fact that while Black Americans comprised roughly one-eighth of the US population, they represented about one-half of the country’s prison population. ‘This disproportionality has been a source of major concern’, Blumstein remarked, ‘largely because it suggests the possibility of gross injustice in the criminal justice system (1982: 1259).’
Statistics on the ethnic background of UK prisoners began to be collected in the mid 1980s, with disproportionality being identified at that stage and becoming more pronounced over time. This led researchers to focus on disproportionality at all stages of the criminal justice process, including searches, crime reports and arrests, and develop explanations for the over-representation of Black, Asian and minority ethnic people across these stages. For example, in 2004 Marian FitzGerald, along with colleagues Chris Hale and Jan Stockdale, constructed a model which sought to account for long-standing ethnic differences in criminal statistics. The resulting model focused on street crime in a number of London boroughs, identifying two overriding explanations for area differences: deprivation and population turnover. In elaborating this model, the researchers stressed the need to be vigilant regarding possible amplification of pre-existing disadvantages via the criminal justice system (CJS) and, more specifically, the unequal exercising of discretion by those working within the CJS.
Disproportionality is widespread and is not restricted to young Black men. Though ‘Gypsies’, Roma and Irish Travellers represent just 0.1% of the population, they account for around 5% of the male prison population, while Muslims are represented in the prison population at three times their proportion of the general population. As Jolliffe and Haque (2017) point out, ‘ethnic and cultural characteristics’ aren’t a feasible explanation for the dramatic increase in the number of Muslim prisoners, from 5,500 in 2002 to 13,200 in 2016. As they point out, ‘the rise in prison numbers (128% increase of Muslims) does not reflect the rise in the general population (74% increase of Muslims from 2001)’ (2017: 3).
After being commissioned by the then incumbent prime minister David Cameron to investigate racial discrimination in the CJS, Tottenham MP David Lammy’s subsequent review was published in 2017. Though the report and its findings pertained to the over-representation of Black, Asian and minority ethnic (BAME) individuals in the CJS, in presenting his review Lammy stressed that understanding the roots of such disproportionality required wider consideration of the complex intersections between racial and ethnic background and other forms of social division and structural disadvantage. As he put it (2017): ‘poverty, lone-parent families, school exclusions, and growing up in the care system. And what more is there left to say about stop and search?’ The review itself contained a litany of damning statistics:
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2 Blumstein, A. (1982) ‘On the Racial Disproportionality of United States’ Prison Population’. Journal of Criminal Law and Criminology, 73(3): 1259–1281. 3 FitzGerald M., Stockdale J. & Hale C. (2003) Young People’s Involvement in Street Crime. Youth Justice Board. https://core.ac.uk/download/pdf/4158137.pdf 4 Joliffe, D. & Haque, Z. (2017) Have prisons become a dangerous place? Disproportionality, safety and mental health in British prisons. London: Runnymede Trust. http://www.iscre.org.uk/wp-content/uploads/2016/10/Prisons-report-2017.pdf 5 Lammy, D. (2017) The Lammy Review: An independent review into the treatment of, and outcomes for, Black, Asian and Minority Ethnic individuals in the Criminal Justice System. London. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/643001/lammy-review-final-report.pdf • 41% of young offenders in custody in 2016 were from BAME backgrounds (up from 25% in 2006).
• Despite only 3% of the general population being Black, 12% of adult prisoners and 24% of children in custody are Black.
• 41% of BAME defendants plead not guilty in Crown Court, versus 31% of white defendants.
• BAME people comprise 25% of the prison population.
• 19% of young people offending for the first time in 2016 were from BAME backgrounds, up from 11% in 2006.
• The estimated cost of the over-representation of BAME people in the CJS is £309m per year.
In seeking explanations for these statistics and ways to address disproportionality in the CJS, Lammy outlined three principles. Firstly, since fairer treatment is achieved through transparency, decision-making procedures must be subject to external scrutiny. Second (and relatedly), work must be done to improve trust in the CJS among BAME communities. As things stand, a trust deficit partly accounts for the disproportionate number of BAME defendants pleading not guilty (and thereby foreclosing the possibility of reduced sentences and any intervention strategies which are contingent on a guilty plea), plus higher reoffending rates (with research showing that prisoners who believe they are being treated fairly are more likely to respect rules in custody and less likely to reoffend on release [Beijersbergen et al. 2016]). Finally, people and agencies outside the CJS – including parents and local communities – have a responsibility to support those who have entered the CJS. These principles informed a set of 35 recommendations, including:
• If CJS agencies cannot provide an evidence-based explanation for apparent disparities between ethnic groups, then reforms should be introduced to address those disparities. This principle of ‘explain or reform’ should apply to every CJS institution.
• A ‘deferred prosecution’ model should be adopted which provides interventions before pleas are entered rather than after.
• The system for sealing criminal records employed in many US states should be adopted. Individuals should be able to have their case heard either by a judge or a body like the Parole Board, which would then decide whether to seal their record. There should be a presumption to look favourably on those who committed crimes either as children or young adults, but who can demonstrate that they have changed since their conviction.
• The MoJ and Department of Health (DH) should work together to develop a method to assess the maturity of offenders entering the justice system up to the age of 21. The results of this assessment should inform the interventions applied to any offender in this cohort, including extending the support structures of the youth justice system for offenders over the age of 18 who are judged to have low levels of maturity.
There have been various statutory responses to the report. In 2018 the Ministry of Justice (MoJ) published fresh statistics on race and the CJS. These statistics reinforced the picture painted in the Lammy Review, with BAME groups being over-represented at many stages throughout the CJS.
______________________________________________________________________
6 Beijersbergen, K. A., Dirkzwager, A. J. E. & Nieuwbeerta, P. (2016) ‘Reoffending After Release: Does procedural justice during imprisonment matter?’ Criminal Justice and Behaviour, 43(1): 63–82.
7 Ministry of Justice (2018) Tackling Racial Disparity in the Criminal Justice System: 2018 Update. London. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/747335/tackling-racial-disparity-criminal-justice-system-2018-update-web.pdf The greatest disparity was evident for stop and search, arrests, custodial sentencing and the prison population, with Black people being over-represented most acutely. Another update was published by the MoJ in early 2020. *Tackling Racial Disparity in the Criminal Justice System: 2020 Update* sought to address the principles and recommendations of the Lammy Review directly. It reported on the formation of a trust working group within the Home Office and the Cabinet Office Race Disparity Unit (RDU). This group commissioned the Cabinet Office’s Open Innovation Team, which promotes closer relationships between policy and academia across government, to survey the existing evidence on trust. Furthermore, Edward Argar, the Minister with responsibility for race disparity, held a two-part roundtable with external stakeholders from BAME-led and -focused organisations, including those with lived experience of the CJS, to listen and record any examples of best practice in restoring confidence.
The working group found that trust in the ability and intentions of CJS staff and representatives was key, though sounded a slightly defensive note in contending that, however well-intended or progressive a set of processes may be, many people will still be unhappy about their experiences in the CJS because of their association with negative outcomes. Strategies for boosting levels of trust included ‘explaining in simple terms what is happening, why, and what to expect next’ (2020: 10), and increasing the number of human interactions (including a greater number of restorative ‘human behaviours’ such as apologising and admitting fault).
Islington Borough Council has designed and implemented a number of programmes with a view to addressing the disproportionate representation of the Borough’s BAME young people in the criminal justice system. Its overarching strategy for a ‘Fairer Islington’ focuses ‘on creating a place where everyone, whatever their background, has the opportunity to reach their potential and enjoy a good quality of life’. This approach is consistent with the local authority’s commitment to make Islington one of the safest boroughs in London, where children become neither victims nor perpetrators of crime.
The borough’s Children and Families Strategy 2015-25, Giving Children the Best Start in Life, centres on the commitment to “better identify and address risk and vulnerability, and provide timely and targeted youth support to reduce offending and reoffending”. This is part of a wider strategy, the Stronger Families Programme, geared to finding and assisting families who have multiple problems. The rationale for this programme is that ‘families with multiple problems achieve better outcomes when their needs are addressed collectively’, with ‘all professionals working with children and families with multiple problems ... expected to use the Stronger Families approach’. Islington’s Youth Safety strategy, Working Together for a Safer Islington (2017), also focuses heavily on the need to keep young people and the community safe.
Haringey Borough Council has also made attempts to address racial disproportionality in its Youth Justice System. Recognising that 47% of the caseload for its Youth Justice Service come from the Black community, despite this group representing only 28% of the population in the borough, members of Haringey’s Children and Young People’s Scrutiny Panel were asked to conduct a review which sought to identify the reasons for the overrepresentation of specific minority groups in the Youth Justice System. The Review’s aims were aligned with Haringey Borough Council’s Corporate Plan and, more specifically, Priority 1 (“Enable every child and young person to have the best start in life, with high quality education”) and Objective 5 (“To work with partners to prevent and reduce more serious crime, in particular youth crime and gang activity”).
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8 For more on the disproportionate representation and experiences of diverse groups as victims and offenders, see: Davies, P., Francis, P., Greer, C. (eds.) (2017) Victims, Crime and Society: An Introduction, second edition, London: Sage; Greer, C. and McLaughlin, E. (2017) ‘News Power, Crime and Media Justice’, in A. Liebling, L. McAra and S. Maruna (eds.) Oxford Handbook of Criminology, sixth edition, Oxford: Oxford University Press.
9 https://www.islington.gov.uk/~/media/sharepoint-lists/public-records/childrenandfamiliesservices/businessplanning/strategies/20142015/20150303islingtonchildrenandfamiliespreventionandearyinterventionstrategy20152025.pdf
10 https://www.islingtongcb.org.uk/SiteCollectionDocuments/Working%20Together%20Youth%20Crime%20plan%202017.pdf The subsequent report, *Children and Young People’s Scrutiny Panel’s 2016/17: Scrutiny Review on Disproportionality within the Youth Justice System*, made 12 recommendations, including: increased partnership working; a review of processes to ensure that all duties are being performed in accordance with the Equalities Act; extra efforts to work with headteachers and school governors on the issue of school exclusions; and the introduction of a reverse mentoring scheme, whereby police officers who are new to the area are mentored by a local young person.
It is in the context of these strategies that the objectives of the disproportionality programme were agreed. These were to: provide training in relation to Adverse Childhood Experiences within BAME communities; provide a forum wherein parents from BAME backgrounds can discuss the pressures associated with their children’s involvement in ASB and/or offending behaviour plus the structural and societal pressures they face; and help staff to better support young people and their families through the poor outcomes and lack of opportunity which, unfortunately, are more prevalent in BAME families.
The various practitioner sessions offered as part of the programme are summarised in the table below.
| Session Title | Content/structure | Location/date & time | Number of Participants | |----------------------------------------------------|-----------------------------------------------------------------------------------|----------------------------------------------------------|------------------------| | Disproportionality and Implicit Bias | • Racial disparity in the UK\
• Institutional racism and unconscious bias\
• Blocked trust – what might contribute?\
• The Lammy Review\
• Trust exercise\
• Stereotyping – a human condition\
• The psychology of stereotyping\
• Implicit stereotypes and unconscious bias\
• How to overcome our biases\
• Privilege\
• So what can we do? | George Meehan House, N22 8YX\
16/09/19 – 9.00am\
George Meehan House, N22 8YX\
16/09/19 – 1.30pm\
Brickworks Community Centre, N4 4BY\
19/09/19 – 9.00am\
Brickworks Community Centre, N4 4BY\
19/09/19 – 1.30pm | 17\
21\
25\
16 | | Adverse Childhood Experiences and Trauma from a BAME Perspective | • Intergenerational trauma\
• Mechanisms of transmission\
• Recovery / resilience\
• Adverse Childhood Experiences\
• Adverse Community Environments\
• ACEs: A BAME perspective\
• IMPACT\
• Final reflections | George Meehan House, N22 8YX\
21/10/19 – 9.00am\
George Meehan House, N22 8YX\
21/10/19 – 1.30pm\
Brickworks Community Centre, N4 4BY\
24/10/19 – 9.00am\
Brickworks Community Centre, N4 4BY\
24/10/19 – 1.30pm | 9\
25\
31\
25 | | Working with BAME Clients to Develop a Therapeutic Alliance | • Relationships\
• Epistemic trust\
• Carl Rogers\
• What young people say...\
• Five planning groups (five tasks)\
• Empowerment intervention\
• Task\
• Feedback from planning groups\
• Next steps\
• Final reflections | George Meehan House, N22 8YX\
18/11/19 – 9.00am\
George Meehan House, N22 8YX\
18/11/19 – 1.30pm\
Brickworks Community Centre, N4 4BY\
28/11/19 – 9.00am\
Brickworks Community Centre, N4 4BY\
28/11/19 – 1.30pm | 19\
20\
20\
16 |
https://www.minutes.haringey.gov.uk/documents/S96560/Scrutiny%20Report%20October%202017.pdf The kitchen-table sessions offered to parents took place between 6.00pm and 9.00pm. Three sessions were offered in each Borough, with session themes mirroring those covered in the practitioner workshops. For example, in the first session, parents were asked what disproportionality meant and what it looked like in the context of their own lived experiences. Subsequent sessions addressed themes such as Adverse Childhood Experiences, Adverse Community Environments and intergenerational trauma. On average, five parents attended each session.
While sessions were oriented around the themes listed above, parents were given the space to discuss and explore their experiences. The issues they raised included their children’s treatment in prison and other custodial institutions, learning difficulties, stop and search, social media, and school exclusion. AIM High’s three facilitators drew on their own experiences as professionals and parents in unpacking the parents’ stories, pointing to commonalities and (where appropriate) possible solutions. After 75 minutes, each session broke for dinner. After dinner, the sessions followed a less structured format, with breakout discussions initiated according to parents’ shared experiences. At the end of each session, the lead facilitator summed up by revisiting core themes and gathering up the various threads of discussion developed by parents throughout the evening.
Analysis of Participant Evaluations and Survey Data
At the end of each session with frontline practitioners and their line managers, participants were asked to complete an evaluation which asked questions about their perceived level of inclusion in the session, the standard of facilitation, the extent to which the session enabled participants to learn knowledge, skills or ways of thinking, and the extent to which participants felt they would be able to use the knowledge, skills or ways of thinking from this session in their everyday practice. Responses to these questions have been collated and are presented in graphical form (by session) below.
Participant Evaluations: Session One (%) Participant Evaluations: Session One (%)
- I will be able to use the knowledge, skills or ways of thinking from this session in my everyday practice
- The session enabled me to learn knowledge, skills or ways of thinking
- The session was well facilitated
- I felt included in the session
Participant Evaluations: Session Two (%)
- I will be able to use the knowledge, skills or ways of thinking from this session in my everyday practice
- The session enabled me to learn knowledge, skills or ways of thinking
- The session was well facilitated
- I felt included in the session
Participant Evaluations: Session Three (%)
- I will be able to use the knowledge, skills or ways of thinking from this session in my everyday practice
- The session enabled me to learn knowledge, skills or ways of thinking
- The session was well facilitated
- I felt included in the session
Strongly Disagree Disagree Neutral Agree Strongly Agree Commentary on Participant Evaluations
• There was broad consensus among participants that all three sessions were well facilitated (with a slight dip for Session Two).
• Free-text comments were relatively consistent in requesting more material that could impact on everyday practice. Facilitators were responsive to this feedback, with participant evaluations recording a general uplift from session to session with regard to impact on everyday practice.
• This upward trend peaked in Session Three, which scored highly for knowledge and skill exchange. The final session also scored highest for perceived level of inclusion, implying that pooling and drawing on practitioner experience and expertise – and thereby sharing best practice – works effectively in impacting everyday practice.
• Free-text comments ranged across a number of issues, with many remarks and suggestions being reinforced during interviews with practitioners. These issues included the number, length and timing of sessions, and omissions in terms of who was invited to participate.
In addition to participant evaluation forms, practitioners were asked to complete an online survey – also created by Aim-High – containing questions on a range of issues relating to disproportionality. The results of the survey, completed by 66 practitioners across the two boroughs, are summarised below.
• 86% of practitioners felt that young people of different races are treated unequally in the criminal justice system.
• 87% of practitioners felt that difficulties regarding racial issues are not ‘a thing of the past’ in the local community.
• 70% of practitioners felt that racial issues create conflict in the local community.
• 83% of practitioners either disagreed or strongly disagreed with the statement: ‘At work I find it challenging to build trusting relationships with Black and minority ethnic service users’. Outline of Practitioner Workshops
All of the practitioner workshops which took place between August and November 2019 were attended by a member of the research team. They both observed and fully participated in these sessions, paying particular attention to issues relating to timing, attendance, delivery, content, and participant engagement. This section of the evaluation addresses these issues while identifying particular ‘Strengths’ and ‘Areas for Reflection/Improvement’.
Strengths
• All sessions were delivered in a timely manner, with members of AIM High arriving early to set up the room, distribute any learning materials and lay out refreshments. Sessions began and ended on time (though there was confusion over start times in more than one instance), with the facilitators acknowledging the arrival of latecomers without disrupting the flow of the workshops. An appropriate number of breaks was incorporated into each session.
• Timing issues during the workshops pertained to discussion segments, particularly where practitioners were asked to reflect on their own experiences. These exploratory discussions were sometimes challenging to manage, especially when it came to drawing discussion to a close. That said, these segments were crucial in ensuring the sessions were inclusive and dynamic, and effective in bringing the experiences of participants to bear on workshop content, and vice-versa. The facilitators exercised good discretion in allowing some of these segments to overrun so that all participants who wanted to contribute were given time to do so.
• The AIM High team members present at each session varied with availability. While this variation did not compromise the quality of delivery, having all three members present made for a richer dynamic plus more variety in the mode and tenor of delivery. Any absences were clearly explained to all participants, with members of the team able to make clear contributions consistent with their particular areas of expertise. The project lead was present at every session, which provide an important element of consistency in the delivery of the programme as a whole.
• Levels and rates of attendance were relatively stable across the three sessions. There was a slight dip in Haringey for session two – particularly in the morning delivery – with some practitioners being unable to attend because of childcare commitments (this session took place during half-term).
• Levels of attendance were slightly higher in Islington than in Haringey.
• Attendees were more likely to arrive late for morning sessions, with facilitators making a clear effort to inform any latecomers of material they had missed and to integrate them into ongoing groupwork and discussion.
• Each session was delivered at an appropriate pace, with introductory principles given sufficient attention and more time allocated to the discussion of complex issues and concepts, like implicit bias and institutional racism. In some sessions it was necessary to accelerate the speed of delivery to ensure all of the content was covered. In most cases, this was due (as noted above) to some discussion segments being allowed to overrun to accommodate the wide range of participant accounts and contributions.
• As per the service specification, there was an ethnic mix and diversity within the staff group and this seemed important in terms of eliciting honest accounts and opinions from practitioners during the course of the sessions.
• Each session was structured logically and thoughtfully. Ice-breaker activities were very effective in putting people at ease and both introducing and involving the various teams who attended the workshops. • The content of each session had been carefully designed so that it aligned clearly with the central aims of the participating services and was divided appropriately across the three sessions.
• The facilitators made very effective use of their past experiences in bringing materials to life. These accounts spanned a number of areas including trust, inter-generational trauma and adverse childhood experiences, grounding discussion in concrete detail and inviting practitioners to reflect critically on their own experiences. This method was also used effectively in concretising more abstract concepts like implicit bias.
• The breadth of methods and material used across the workshops was impressive. The range of materials used included slides, worksheets and videos, and in many cases these underpinned or corresponded with varied methods including small- and large-group discussion, breakout activities and group tasks. This combination catered well to a range of preferred modes of learning.
• Ice-breaker activities were effective not just in generating discussion but in encouraging people to think outside their own organisational structures and teams.
• All group discussions were thoughtfully set up and expertly moderated.
• In many cases subject matter was personal, emotive and potentially divisive, and the facilitators’ experience and expertise was evident in how they guided the discussion across what was often difficult terrain. All issues were treated with the necessary gravity and sensitivity, with an open, enabling environment being created and sustained.
• All discussions were kept on track, with the purpose of an activity being revisited and underlined where necessary. This was achieved while making each participant feel they had made an important and valuable contribution.
Areas for Reflection/Improvement
• Participants operated at different speeds in terms of knowledge and experience. Many had attended similar training before, and were vocal in their preference for identifying and discussing concrete examples of best practice. A clear statement about how each session would build on the content of preceding session(s) in the Disproportionality Programme, underlining the cumulative nature of the programme, would have been helpful in this respect.
• In relation to the previous point about identifying connections between sessions and stressing the cumulative nature of content across sessions, some tweaks in terms of structure could be made. For example, delivering the ice-breakers after the session outline would set tasks in a clearer context, giving narrower boundaries for discussion and thereby helping to contain the activity in terms of time and topicality.
• Much of the session content was underpinned by the findings of relevant academic research, including theoretical models and more purely empirical work. This research was presented clearly alongside a full exploration of its relevance for the issues being discussed. Obviously the nature of the research incorporated reflected the academic specialisms of the facilitators, with research around trauma and ACEs being especially well explained and explored, while the social scientific research on institutional racism could have been more contemporary.
Recommendations
Structure and Approach: In any future disproportionality programme involving staff training, move ice-breaker activities to after the session outline, specify the cumulative nature of learning from session to session, and incorporate ‘learning into practice’ action planning after each session. Outline of Parents’ Sessions
Sessions for the parents of young people engaged in the CJS were held on the same day as practitioner workshops in each borough, and followed a semi-structured, kitchen-table format. Each round of sessions was attended by a member of the research team. Our observations and analysis are presented below, while again we have identified particular ‘Strengths’ and ‘Areas for Improvement’.
Strengths
• Holding sessions at neutral venues rather than, for example, in Youth Offending Services buildings, created a more relaxed atmosphere for the parent participants.
• Serving food at the sessions worked well in terms of bringing parents and facilitators together and putting parents at ease. This mode of delivery struck up and sustained an informal tone that parents obviously found enabling.
• While the kitchen-table format gave the sessions an informal tone, facilitators ensured that the discussion was structured around a series of questions listed on a flipchart at the centre of the room. This also allowed any parents arriving late to apprise themselves of the session’s key aims.
• As with the sessions for frontline practitioners, the neutrality of AIM High staff was important in eliciting honest accounts from parents. Many of these accounts were critical of various state agencies and procedures, and the same level of honesty may not have been achievable had sessions been facilitated by representatives of the two respective boroughs. Should this element of the programme be rolled out, using a third-party to facilitate discussion may again prove advantageous.
• Parents appeared to feel comfortable sharing accounts of their own and their children’s experiences of engagement with the CJS, including discrimination. These accounts were moving and emotive, and facilitators moderated the discussions with sensitivity and skill. As far as possible, facilitators framed these stories in terms of a set of key questions around disproportionality that shaped the service specification.
Areas for Reflection/Improvement
• Only a small proportion of the parents invited to the sessions attended. The limited engagement by parents was despite the best efforts of practitioners and members of AIM High, who reached out to them via telephone and email. With parents bearing various responsibilities including work and childcare, attending evening sessions may have been challenging.
• Most of the parents who attended workshops faced significant challenges in raising their children and in interfacing with the CJS and local authority services. These included poverty, family breakdown, domestic abuse, school exclusions, mental health problems, drug misuse, and lack of childcare provision. Their accounts provided significant insight into the ACEs faced by young people and, as noted elsewhere in the report, encompassed structural and systemic issues. The facilitators made a clear effort to identify connections between these issues and (where appropriate) their disproportionate impact on BAME communities.
Recommendations
Dissemination: Disseminate this project’s key findings regarding challenges and obstacles faced by parents to relevant members of staff, including senior leaders, and beyond. Service Aims
The Grant Agreement and Specification document, co-signed by AIM High and London Borough of Islington’s Youth and Community Service (on behalf of Islington and Haringey), identifies four service aims. Below we address each of these in turn, again identifying key ‘Strengths’ and ‘Areas for Reflection/Improvement’.
1. To provide training around Adverse Childhood Experiences within BAME communities. Training for staff will highlight cultural and community competence, conscious and unconscious bias and a return to an understanding of institutional racism and how it impacts on individuals and communities.
Strengths
• Session two centred on Adverse Childhood Experiences (ACEs) and trauma from a BAME perspective. Topics covered included intergenerational trauma and how to recognise signs of trauma in BAME clients. The section on intergenerational trauma incorporated video material and covered the key mechanisms of this trauma. Crucially, the workshop covered both Adverse Childhood Experiences and Adverse Community Environments and, using the research of Ellis and Dietz (2017), explored the dynamic between the two. The issue of cultural/community competence was covered in the context of Adverse Community Environments and led to rich group discussion on some of the shortcomings of existing community environments, how these might exacerbate trauma for young people and their families, as well as the more positive elements of community life that could be built on and supplemented. The first session included an engaging, comprehensive section on implicit stereotypes and unconscious bias, including the Implicit Associations Test and the relationship between unconscious bias, institutional racism and trust. The activities incorporated in this section of the workshop were effective in prompting reflection on participants’ implicit biases and how these figured in their day-to-day lives. The first session included a detailed and informative section on institutional racism, its impact, and its connections with implicit bias. The section covered the Scarman and Macpherson Reports, connections with persistent forms of racial disparity and issues of blocked trust.
• The multi-agency training sessions were attended by a diversity of services – Children and Adolescent Mental Health, Police, Probation, Youth Offending Services, among others. This diversity encouraged exchange, debate and a good degree of healthy challenge as systemic cultures and operational mindsets – and the tensions between them – were outlined and explored.
Areas for Reflection/Improvement
• In addition to using hypothetical scenarios to tease out connections between biases and the (re) production of unequal outcomes, in future the facilitators may wish to refer to the GEMM Project’s (2019) research on discrimination against ethnic minorities by employers (based on 3200 fictitious job applications).12
• Future iterations of this workshop may be enhanced by considering various forms of institutional racism/discrimination and their transmission as outlined by Robert Reiner (2010).13 Contemporary issues such as the mistreatment of ‘Windrush-generation’ migrants could also be used to illustrate the operation and effects of structural racism.
______________________________________________________________________
12 http://csi.nuff.ox.ac.uk/wp-content/uploads/2019/01/Are-employers-in-Britain-discriminating-against-ethnic-minorities_final.pdf
13 Reiner, R. (2010) The Politics of the Police. Oxford & New York: Oxford University Press. Recommendations
Use of academic research: Make fuller use of key social science research insights into implicit bias and the transmission of discrimination, particularly as these relate to race and ethnicity, in future iterations of the programme.
2. Setting up an initiative whereby parents from BAME backgrounds have a safe space to discuss the pressures associated with their children's involvement in ASB and/or offending behaviour and the structural and societal pressures they face. These support forums will be utilised to raise and resolve issues as they experience them.
Strengths
• As noted elsewhere in the report, the parents' workshops were effective in providing a forum wherein people felt comfortable discussing their experiences in an honest, exploratory manner. Parents identified a number of pressures relating to their children's involvement in ASB and/or offending behaviour. Many of these pressures concerned issues covered in the practitioner workshops, including intergenerational trauma and a lack of trust in statutory processes, systems and representatives. The other issues identified by parents included structural and societal pressures relating to racism, poverty, substance misuse, family breakdown, mental health issues, unemployment and/or low-paid, precarious employment in the service sector, procedural and interpersonal issues with local authority services, the care system and the prison service. The facilitators struck a fine balance between listening, sympathising and pointing to possible resolutions in relation to the issues raised. In some instances this was extremely difficult, as parents seemed to want others to acknowledge the intractable nature of the problems they faced. However, as noted elsewhere in the report, facilitators were consistent in framing conversations according to session themes, pointing to possible sources of support and working towards solutions wherever possible.
Areas for Reflection/Improvement
• Although the workshop had clear benefits for those parents who participated, levels of attendance were low. Obviously there are many competing claims on parents' time, and it is difficult to determine a time/location for workshops that is suitable for the majority. This challenge underlines the desirability of more regular parents' forums. These would widen and deepen engagement with parents, offer a more varied range of times/locations, and allow for the tracking of issues over time (as opposed to getting a 'snapshot' via discrete accounts).
Recommendations
Parental engagement: Consider offering a more extensive programme of parents' forums, including parent-practitioner sessions, ideally moderated by a third party. 3. It is hoped the service covered by this specification will help to better support young people and their families from the poor outcomes and lack of opportunity which unfortunately, is more prevalent among BAME individuals and families.
Strengths
• Although it is too early to determine the extent to which the services in Islington and Haringey will enhance support for BAME young people and their families, there are grounds for optimism. Participant evaluations from the practitioner workshops show that a clear majority of participants felt that they had learned lessons which could have an immediate impact on their everyday practice, with levels of engagement remaining high across the three sessions.
Areas for Reflection/Improvement
• With so many of the poor outcomes identified and explored during practitioner and parent workshops being underpinned by persistent structural inequalities, interventions such as this do not represent a ‘magic bullet’.
4. This intervention ultimately is about strengthening communities who have been marginalized. This intervention will look at disproportionality at a local level. Supporting the community from a cultural approach, where experiences are shared, will strengthen the community. It will also influence Islington and Haringey to shape and improve the services provided, so that young people and their families are supported to (improve outcomes and opportunities so they can) ‘live their best life’.
Strengths
• The hallmarks of a cultural approach were evident in the way that parents’ sessions were designed and conducted. In some cases, parents had taken their own initiative in organising neighbourhood forums, with these instances highlighted and explored by facilitators. Parental accounts were grounded in local conditions, including territorial enmities between young people and the particularities of local services.¹⁴
Areas for Reflection/Improvement
• The centrality of local factors and conditions in parents’ accounts points to a need for local authorities to be proactive and reflexive in organising forums and other initiatives in response to events at a local level.
• More generally, it might be helpful to include details of each Borough’s cultural/ethnic breakdown as part of the wider Local Authority training programme, so staff can develop a deeper understanding of the Borough they are working in from the start.
Recommendations
Being responsive to local factors: Combine ad hoc forums in response to specific incidents and events with more regular outreach programmes that both draw on and share expertise from relevant services.
¹⁴ For more on territorial enmities between young people in London, including attempts at resolution, see: Armstrong, G. & Rosbrook-Thompson, J. (2017) ‘Squashing the Beef’: Combatting Gang Violence and Reforming Masculinity in East London. Contemporary Social Science: Journal of the Academy of Social Sciences, 12 (3-4): 285–296; Armstrong, G & Rosbrook-Thompson, J. (2016) ‘Faith, Space and Selfhood in East London ‘Youth Gang’ Culture’. Urbanities: Journal of Urban Ethnography, 6(2): 18–38. Service Outcomes
The Grant Agreement and Specification document, co-signed by AIM High and London Borough of Islington’s Youth and Community Services, identifies five service aims. Below we address each of these in turn, while again identifying key ‘Strengths’ and ‘Areas for Reflection/Improvement’.
1. Islington Targeted Youth Support/YOS/Integrated Gangs Team and Haringey Youth Justice Service/Early Help/Youth Service to have factual insight and awareness of BAME communities and issues that marginalize them and how to respond supportively to the young people they are working with.
Strengths
• Evidence from observations and participant evaluations indicate a clear attempt to impart factual insight and awareness of the issues that affect and marginalise BAME communities and individuals. The practitioner workshops were effective in pooling and exploring participants’ experiences and expertise around these issues. While these were not always distilled into instances of ‘good practice’, in most cases because responses needed to be carefully tailored to the specificities of a particular young person or family, each response demonstrated a sensitivity to the challenges faced by BAME communities. That said, many practitioners identified blockages at institutional level which, in their opinion, limited their ability to offer truly effective responses.
Areas for Reflection/Improvement
• As noted above with regard to parents’ forums, it would be helpful to disseminate the findings of interviews with young people (in addition to this evaluation report) to a wide range of local authority staff. The lines of questioning pursued in these interviews led to issues being raised that may not be addressed in young people’s routine engagements with local authority services.
Recommendations
Dissemination: Disseminate this project’s key findings regarding challenges and obstacles faced by young people to relevant members of staff, including senior leaders, and beyond.
2. Improved engagement with local parents and young people.
Strengths
• The parents’ sessions and interviews certainly facilitated improved engagement with local parents and young people. Improved engagement over a prolonged period of time would likely require the delivery of a wider range of sessions at a range of times and locations, in order to boost attendance. Another possibility would be to support and perhaps supplement existing parent initiatives. As with the other sessions offered as part of the programme, the neutral status of AIM High staff was important in eliciting honest accounts including the identification and exploration of challenges faced by BAME families. Any rolling out of the programme (or elements of it) would benefit from the continued presence of a third-party in a broker/facilitator role. Areas for Reflection/Improvement
• The virtues of this position were underlined during parents’ and practitioner sessions, as well as interviews with practitioners and young people, when it came to identifying frustrations and challenges – especially those that were procedural or systemic. Additionally, with persistent problems such as school exclusion, poverty and childcare arrangements being identified by many participants and interviewees, perhaps greater acknowledgement of the connection between underlying structural inequalities and forms of racial disadvantage in routine dealings with local families and young people would be beneficial.
3. Young people and families will be more willing to engage with support services to prevent poor outcomes, and will have greater confidence that they will be treated fairly by services and that staff have an awareness of their cultural needs.
Strengths
• It is too early to make any meaningful judgement in relation to this outcome. However, providing a forum for families and young people to discuss the challenges they face is certainly a step in the right direction, and the initial signs are positive.
Areas for Reflection/Improvement
• On the issue of awareness of cultural needs, while some of the points raised by parents regarded shortcomings on this issue, young people were wary of (potentially clumsy) attempts to profile them and their needs and/or lifestyles.
4. Reduction in breaches instigated by the YOS (in Islington and Haringey) indicating impact of project on engagement
Strengths
• Again, it is too early to make any meaningful judgement with regard to breaches instigated by YOS in Islington and Haringey. However, every young person interviewed expressed a desire to avoid breaches and make positive changes to their lives.
Areas for Reflection/Improvement
• One particularly powerful interview with a young person underlined the importance of seeking to improve engagement with young people within appropriate forums. This young person’s account raised the possibility that the procedures and routines of some services may put particular young people at risk and also increase the likelihood of breaches occurring. In this instance, a 16-year-old who was required to visit the YOS office regularly was attacked en route by a rival group who were aware of his daily movements. He therefore travelled to and from the YOS building with his own entourage, increasing the likelihood of subsequent altercations between the two groups. Naturally the young person was anxious and feared for his own safety, which adversely affected his levels of engagement. Demonstrating a greater awareness of these issues may improve engagement and, more specifically, encourage young people to engage with the aims and objectives connected with a particular procedure, as well as the procedure itself. Recommendations
Review the safety and risk implications of YOS procedures: Consider whether the routinisation of young people’s movements created by YOS procedures/protocols may increase risk of harm.
5. Islington and Haringey to explore alternative ways of maintaining and increasing young people’s engagement.
Strengths
• The programme’s interviews with young people provided some encouraging signs with respect to engagement. Young people seemed encouraged by the open-ended exploration of the issues they faced which took place during interviews.
Areas for Reflection/Improvement
• It bears repeating that choosing the right forum for engagement is important. During some interviews with young people, it became clear that some were effectively carrying out their own risk assessments, weighing risk of failure to attend appointments against risk of harm at the hands of other young people. Once again, the fact discussions were facilitated by a third party, with young people’s responses indicating that facilitators were perceived as neutral, was important in exploring the challenges and frustrations they face.
Interviews
Interviews with a cross-section of the frontline practitioners who attended workshops were conducted at YOS sites in Islington and Haringey, respectively, in late 2019. A number of parents’ workshops were also voice recorded for the purposes of evaluating the project and identifying parents’ lived experiences with regard to disproportionality. Finally, young people engaged in the CJS were also interviewed at YOS sites with a view to capturing their experiences pertaining to offending histories and any issues around disproportionality. Our analysis of these interviews/discussions is presented below and addresses issues raised by practitioners, parents and young people, in turn. Practitioners
Police attitudes
Some practitioners described having to challenge the police’s ‘set view’ of particular families and individuals in a multi-agency context:
_The young person that I’m working with just now ... if you speak to my colleague – police colleagues – they say, he’s no good, he’s no good, he needs to be locked up, he needs to be locked up. That’s the only thing they knew about him._ (I12: 2)
Sentencing practices
An important question for practitioners concerned racially disproportionate outcomes in some courts and, more specifically, how to translate acknowledgement into action without further exacerbating outcomes:
_It’s how we challenge that around remands, which is one of the biggest areas. Because it’s quite something to go into a court and take on a Judge and essentially kind of highlight that specifically that court has been giving negative outcomes for young people, with the only clearly defining aspect the fact of their background. So that is not a comfortable conversation and one that I think is going to require some prep, both for the court and for staff about how we kind of do deliver that challenge. Because otherwise you run the risk of alienating the court even more and getting worse outcomes for young people._ (I2: 3)
The need to communicate effectively with the courts in order to foreground issues pertaining to disproportionality was underlined by another practitioner:
_... in terms of things like sentencing I think it’s really important – young BAME people are more likely to be remanded and all those kind of things. So I think, thinking about how we communicate that with the courts and get it in the forefront of their minds when they’re making those decisions._ (I3: 6)
Recommendations
**Reporting on and scrutinising disproportionate court outcomes:** Explore the possibility of compiling regular reports for local courts detailing disproportionate outcomes for BAME young people from Haringey and Islington – particularly remand and custodial sentences – and introducing an annual or biannual scrutiny panel, including local court representation, to scrutinise those reports.
School exclusions
A similar frustration about acknowledgement and action was expressed with regard to school exclusions:
_... we’re not being ballsy enough in [that] we’re not going up to schools and saying, you need to sign up to zero exclusions. You know, I feel that we in a room acknowledge what the issues are but I think perhaps we – I don’t know whether or not I’m low – I’m down here, so I’m not aware enough of the strategic conversations that are happening to try and make some changes for these young men._ (I5: 8) This desire for action is borne out by research on school exclusions. A recent report by the All-Party Parliamentary Group on Knife Crime (APPG 2019) noted a significant increase in the number of permanent and fixed term exclusions (70% and 54%, respectively, across all state-funded primary, secondary and special schools) between 2012/3 and 2019 and underlined the possible links between school exclusion and serious youth violence. Citing research by the Mayor’s Office for Police and Crime (MOPAC), the report noted that pupils in alternative provision are more likely to know someone who carries a knife than those in mainstream educational settings. Other research shows that exclusions are racially disproportionate, with children (especially males) from African-Caribbean, Irish Traveller and Gypsy/Roma backgrounds three to four times more likely to be excluded than other groups (Timpson 2019).
Creating a space for critical discussion
While practitioners described issues relating to disproportionality being alluded to in their day-to-day work, especially in the context of team-based work, the Disproportionality Programme workshops allowed for detailed, exploratory discussion of these:
*I think what was good was like it was – you know, space to have a certain conversation. Because I feel like all organisations should continuously have those conversations because these issues aren’t going anywhere for now.* (I8: 1)
*So it was valuable in the sense that there’s not many times you’re going to have a whole workforce really have to sit and think about discrimination and really look at it and really think about it in a way that that training forced colleagues to. So I found that very, very helpful. But the first and second allowed a dialogue to be opened. So it really allowed us to talk about things that people don’t like to talk about generally.* (I4: 1-2)
*I think a lot of the things we talked about were like – it was all really interesting and I think it just brought a lot of it back to the forefront of like all of our minds, like having those conversations.* (I3: 1)
Furthermore, practitioners appreciated learning about their colleagues’ experiences (in both a personal and professional capacity) and were encouraged that the sessions had not been prompted by a particular flashpoint (i.e. they were motivated by an ongoing concern about disproportionality and the adverse impact on children and young people being worked with).
*While talking to everybody else, their experiences were really awful from the start. So having those discussions with you about the people’s perceptions and experiences, it opens kind of really the mind of other people’s experiences.* (I10: 3)
*What I’ve found – what it did really bring to focus for me was how many of my colleagues are carrying around so much from their own experiences. And it’s not something I guess I don’t know, but something that very much brought into focus that, which wasn’t particularly comfortable I don’t suppose, but quite healthy as well.* (I2: 2)
*Yeah. I think it’s made me like think about and sort of feel more confident in like having the conversations with young people about their experiences as well.* (I3: 5)
*Whereas this way was a balanced, controlled – no-one was in trouble, no-one was being accused of being a racist, so it wasn’t off the back of something. Whereas society I find as a whole generally only really acts in a big way, in a reactive way.* (I4: 2) Differing levels of experience and expertise among practitioners
Whereas all practitioners identified at least one element of the workshops that they found helpful, many pointed to areas where there was some repetition of content covered in training sessions they had attended previously. In light of this, some would have appreciated the option of attending sessions selectively (based on self-assessment of knowledge/skills). Not all staff participants attended all three workshops, for a variety of reasons, though this would have been preferred in order to benefit from the cumulative nature of the learning. Participants offered suggestions about how the structure and content of workshops could be refined.
... it’s very difficult if you have not grown up around diversity, to then be in a position where you are forced to be able to deal with diversity and then be able to just hit the ground running and understand the families and understand the young people and understand all the little nuances and be able to build these brilliant relationships ... if anything I think two-thirds of the training was done from a very theory point of view and I would have liked maybe one training theory and two of the trainings very practical. (I4: 4-6).
I almost found it, are you saying that I don’t know how to work with this cohort? Are you saying that I’m struggling to engage this cohort? Are you saying that I’m not quite appreciating the traumatic, you know, trans, you know; are you saying that I’m – that’s not coming through in my work hence why I’m here? And I almost – it was a bit like I was looking around for some – yeah, some sort of validation about why I’m (here) (I5: 8).
But what I felt is that we kind of skimmed a lot of different subjects. We got a basic introduction to lots of different areas, some of which we’ve all had lots of training on. So I felt that it would have been more beneficial. ... it probably would have been helpful ... to have a conversation, not in terms of where the service is at, prior to actually designing the training. You know, the discussions that I’ve had with other sort of managers and also with other practitioners is that they felt they could have been pushed a bit more. Maybe for it to be a little bit more controversial. (I6: 4 & 7)
Other suggestions included delivering the workshops over two full days (partly on the basis that practitioners who attended afternoon workshops were less fresh and carried the mental baggage of a full morning’s work) and to spend more time focusing on workers’ intergenerational trauma.
Recommendations
Format of programmes: consider using full-day rather than half-day sessions.
Issues with content
Though all practitioners were in broad agreement about the need for the workshops, a small number took issue with session content and/or the way it was presented. It was suggested that workshops should cover manifestations of institutional racism across society (to balance the focus on police through Macpherson, etc.), while there was also some scepticism in relation to intergenerational trauma. (No quotations have been included here in order to preserve the anonymity of practitioners.) Disproportionality as an issue in upper echelons of local authorities
Some practitioners talked about racial disproportionality within many local authorities, and particularly at management level, which in their view necessitated an ‘inside-out’ approach to addressing the problem. This observation was related to suggestions that workshops should be attended by as many employees as possible, including those in senior management positions, and that procedures (as well as attitudes/approaches) should be examined with a view to reform:
It’s then, kind of undermined by the fact that obviously it’s systemic and process-driven as well ... So it’s a real – it misses, especially these days I think, because there has been a distinct movement in the last five years or so to a more therapeutic, strengths based approach. But the legislation and things like inspection criteria obviously always lags behind by a few years. (I2: 5)
... actually it’s an internal issue, what am I doing about what’s going on internally from my colleagues and how they feel. And then in challenging things that are a bit closer to you I think you become better equipped at challenging those things that are outside of you, you know. (I8: 6)
The strongest session – best practice-based and action-orientated
Many practitioners thought the final workshop was especially helpful and productive:
But it was that kind of practical, healthy discussion about what we can actually do was something that I really enjoyed in that last session without a doubt. (I2: 3)
The most helpful thing I found was maybe the last session, in being able to develop some agency around kind of collective responsibility in the room and us all thinking about what we could all be doing differently, tangibly, you know, realistically, in terms of trying to make a change. (I5: 2)
Recommendations
Replicating an action-orientated training focus: Prioritise the identification and dissemination of good practice, which can have an immediate impact on practitioners’ day-to-day work, in future iterations of the programme. Parents
Trust, communication and use of information
Parents were confident in describing their engagement with local authority services, but some identified issues regarding trust. In one case this concerned communication, information sharing (in a multi-agency setting) and the possibility of being judged:
*I have in the past had phone calls and they’re saying, oh have you heard from your daughter, have you heard this, or, do you know this, and you may know what the information – you may have the answer to what they’re looking for, and then... but when it flips the other way they said, yeah we’ve seen her. So I said, well are they okay, yeah she’s okay. Oh well what are you working on at the moment? What are you doing? Or, I’ve emailed you. Oh yeah well yeah we’ve seen her, but it’s very, very generic; they’re not really – whereas you want to talk, you want to have that dialogue with them, but it’s just not happening ... And the other thing is, when you’re giving this information, you also feel that you’re being judged ... You feel that you’re being judged and because they’re not feeding back to you, it makes it even worse. What are they hiding? Why aren’t they communicating with you in a way to make, you know what, it’s actually quite good that you’re engaging with us, or, we can see that you want to work with us and it’s not you, it’s just how the situation – they don’t give you any form of encouragement.*
Yes which I think for me, it’s not something that parents are even aware of. I think naively, yes, we know they must record it somewhere, but I think, as a parent, if we’re working with any sort of like, professionals in that way and they’re recording personal information and they’re sharing that kind of information, they need to tell us, because we’re not told that (I1: 2-3, 5)
This was an important concern, given it could colour parents’ view of working in partnership with local authority services:
*I was quite an avid supporter of working in partnership and working in partnership again but looking back at it, it just feels like hold on a second, now I’m thinking, somewhere in this system you’ve got all this information about me and people close to me, and what’s that about? What have you done with it? How has it been used? Where’s it been passed to? Does it then – do you understand what I mean? (I1: 6)*
At its most acute, this perception could lead to partnership working being understood according to a ‘them against you’ dynamic:
*... there can be at times so many interventions all going on at the same time ... And you think well, what’s going on? Why are we here? What’s the progress and to get that interaction and get an update when there’s an intervention here, there’s a psychologist, there’s nurses, there’s case workers, there’s all kinds of different people involved and it’s just them against you. (I1: 3)*
The role of parent co-ordinators
A possible remedy for this was the ‘Parent Co-ordinator’ role – at present only available in Islington – through which parents could be empowered, and levels of engagement and communication could be boosted. The forums created via this role may also help to combat the feeling of loneliness that some parents felt with respect to the challenges of parenthood. As one parent commented: ... from my own personal experience, I think if the YOS team engage well with the parents it will hopefully produce better results. But how we do that, but in a constructive way, I think we need to just focus on like the case workers, working with the parents and I’m sure a lot of them do. But I think just like you’re doing parent support, I think the YOS workers needs to adapt some of that as well where they’re working with the parents. I don’t know, I didn’t get that, I personally didn’t get that and I think just like what you’re doing years later, I think that’s something that they should be thinking about, working – I don’t know if they have something like that now. (I1: 7)
The limitations of individualised interventions
Another observation concerned the locus of intervention, with some parents feeling that family-focused interventions failed to attend to wider societal issues:
Because I know from personal experience it’s very, very distressful when you’ve got a young person that’s been arrested, going to court and all the rest of it, and it’s not you, a lot of parents it’s not them; it’s the society that we live in. (I1: 8)
Recommendations
Boosting parental trust and engagement: consider strengthening whole-family working practices and models, including the creation of parenting worker roles where these do not already exist.
Young people
School exclusion
The majority of the young people interviewed had been excluded from mainstream education, with the remainder having voluntarily withdrawn from further education (sixth form colleges).
The reasons for permanent exclusion were varied, and included violence against teachers and knife-carrying in school. In the latter instance, the young person described being bullied by older pupils for three years (between the ages of 12 and 15) – and recalled having expressed a desire to move to another school – with a knife eventually being carried into school for protection:
... some kid in my year threatened me and I got really angry and it was one of those things where when I get angry it’s one of those things where I don’t remember what I did or what happened, in that sense. Apparently I brought it in, didn’t use it on anyone, it was just in my possession to keep me safe. (I9: 9)
Another young person had been permanently excluded twice:
So like my schooling history was like – from Year 6, I got into situations in school, so I’m arguing with my head teacher, being physical and I ended up breaking an elbow and then I got sentenced to a unit in primary school. They sent me back to mainstream in Year 6. I then got kicked out again and I got sent to the unit and I’ve been in the unit since about Year 10. (I13: 2) Recommendations
Increasing accountability for school exclusions: Consider identifying and collating longer-term outcomes for excluded BAME young people, and disseminating this information on a school-by-school basis.
Treatment by Police and the Criminal Justice System
While one young person described being treated fairly during arrest, others thought the process was unfair. One young person recalled the circumstances around their arrest:
... they were mugging me off ... taking the mick. (I14: 4)
It should be noted, however, that this young person felt they had been treated fairly after arriving at the police station.
There was a lack of consensus among young people as to whether they had been treated fairly by representatives of the CJS. Whereas some BAME young people thought their background had not resulted in any unfair treatment, others spoke of unequal outcomes with an air of resignation. Indeed, some young people deemed their treatment had been fair when measured against their knowledge and previous experience of prevailing standards rather than against more abstract, theoretical standards of fairness and equality. This was evident in young people’s reflections on sentencing:
(In response to a question about the possibility of being treated more harshly as a young BAME male): No. How I’ve been treated or how I am treated, it doesn’t change anything. It’s just I guess what happens. (I9: 7)
Another young person recalled their treatment with similar resignation:
I wouldn’t say fair, but it (my treatment) was – it wasn’t too bad, but because of my role, I don’t think I should have got as long ... (In response to a question about whether being a BAME male contributed to his sentence): Possibly. Because that’s mostly what happens in the justice system ... You can’t say everyone in the justice system (is prejudiced), because like everyone’s the same, but the majority of the people, like police and stuff ... It seemed like she (the judge) didn’t really take in what we were saying, what I was saying anyway. It’s like from the beginning she decided towards the victim. (I15: 5-6)
Discussion of Pre-Sentence Reports also prompted some interesting reflections:
Yeah (I contributed to the Pre-Sentence Report) ... (It was) a true representation ... It helped me not go to jail, yeah ... but what am I doing for a whole year coming here?... But it’s punishment. That’s it. If you was to give someone a punishment, you’d give them a punishment, that’s like at least they learn something ... (I would have respected a punishment) if it was shorter and I actually learnt something. (I14: 6-7)
Recommendations
Police relations with young people: Police Borough Command Units should continue working to strengthen relations with BAME young people. YOS processes/procedures
Young people offered a number of insights on YOS processes and procedures. One young person described the YOS building representing authority and, more specifically, the Police. As alluded to earlier in the report, some young people raised issues with some YOS processes and, more specifically, were concerned that these may be heightening risk of breaches and/or putting them in possible danger:
Yeah it’s been nuts. But I think even today – but I think it’s like the fourth time today I’ve had a situation on the way to come to the YOT... it’s only when I come here I get into an issue. I’ve got to come every day, so it’s like yeah they try to help me here but they also set me up as well in the same instance ... I know, but I’ve become accustomed to it. It’s like obviously the first couple of times it happens you panic, your heartbeat’s – all of these things but then all you do is get yourself in a worse predicament. But if you’re panicking, nothing’s going to get done. You can’t accept the situation, you can’t safeguard yourself, you’ve just got to – it happens. (I13: 4)
The same interviewee expressed frustration that practitioners could not admit the impossibility of his situation, with this frustration leading to a lack of meaningful engagement with services:
In my position, we’ve only got two options. We’ve got to go to jail – more likely you go to jail or you die, because you either don’t carry your shank and you get backed into some sort of rivals and then you’ve got no means to defend yourself, you’re dead. Or you carry a shank and you get stopped and searched and you might go to jail. But I would rather be alive in jail than be dead on the road, yeah. So I’d rather have my shank ... They know, but they don’t understand what we go through. It’s the fact that this building exists. So we come here for them to say to us... well, they’re trying to steer us right onto a greater life. So we come here for them to say to us, like, well it’s about time you made a change. What do you mean it’s about time I made a change? I’ve been trying to live – that’s what I’m trying to do. I’m trying to stay alive. What, am I not meant to try and stay alive? ... I’ve always asked them, so what do you want me to do because I’m carrying my weapon, I get arrested, but I don’t carry my weapon and I die. You tell me what I should do? They won’t answer my question. They just talk quickly; say something and I’ve got to go. They never want – they can never give you an answer because it’s a sticky situation and you have no answer. What are you going to tell me? You’re telling me to die. No one wants to tell me what to do. So they do their job and they let me do what I need to do and that’s it. Nobody cares about the ins and outs of the situation. (I13: 5-6, 10)
Case workers
Young people were divided on the credentials of an ‘ideal case worker’. While one young person insisted this should be ‘someone that’s been involved’, others were less prescriptive. Indeed, for one mixed-race young man, a white female case worker had assumed the role of father:
She’s just like one of the – she’s one of those staff people that like they don’t – how can I explain it, they don’t, like, discriminate against you in any shape or form ... I would say she’s like my dad. I don’t get along with my mum like I used to. Even though I live with her. I don’t speak to her properly, I don’t respect her. She don’t respect me. We just don’t have that type of connection ... Race, colour, sexuality, it doesn’t mean anything. She’s still a human being and we’ve just got to treat everyone the same. (I9: 5) Some young people were wary of attempts to engage with them that involved undue profiling:
... they (case workers) get aspects of me. But as I said earlier, they get certain things like people – I don’t know, it’s a push and go thing because like – it’s like yeah cool, they understand something, but because they understand a little part, like they’ve understood – ... they understood the first part, they can connect with the second part, they automatically believe that they know you now. So now they’ve made that small connection on – ah they play basketball, you play basketball too, now they believe they know your whole story. Everything that you do is around basketball and they believe that they know you too much. They end up f\*\*\*ing up and the whole situation – now you don’t have a relationship with them, you just see them as annoying. (I13: 8)
Involvement in crime and maturational reform
On their offences, while some young people spoke of carrying weapons for protection, others described getting involved in county lines drug distribution through peer groups. One young man was convinced of the power of what criminologists call maturational reform, stating ‘Everyone falls away, everyone’ (I7: 19). Conversely, this underlines the importance of protecting younger people by limiting their exposure to forms of trauma and exploitation which have a proven association with factors such as school exclusion.
Recommendations
Young People’s engagement: Continue capturing the voice of young people in relation to disproportionality.
Recommendations
The recommendations which appear throughout the report are collated below. The aim is to help Islington and Haringey further improve the work they are leading on to tackle disproportionality and the over-representation of BAME young people in the CJS: Recommendations
01. Structure and Approach In any future disproportionality programme involving staff training, consider using full-day rather than half-day sessions, move ice-breaker activities to after the session outline, specify the cumulative nature of learning from session to session, and incorporate ‘learning into practice’ action planning after each session.
02. Dissemination Disseminate this project’s key findings regarding the challenges and obstacles faced by young people and parents to relevant staff members, including senior leaders, and beyond.
03. Use of academic research Make fuller use of key social science research insights into implicit bias and the transmission of discrimination, particularly as these relate to race and ethnicity, in future iterations of the programme.
04. Young People’s and Parental engagement Continue capturing the voice of young people in relation to disproportionality and consider offering a more extensive programme of parents’ forums, including parent-practitioner sessions moderated by a third party.
05. Being responsive to local factors Combine ad hoc forums in response to specific incidents and events with more regular outreach programmes that both draw on and share expertise from relevant services.
06. Review the safety and risk implications of YOS procedures Consider whether the routinisation of young people’s movements created by YOS procedures/protocols may increase risk of harm.
07. Reporting on and scrutinising disproportionate court outcomes Explore the possibility of compiling regular reports for local courts detailing disproportionate outcomes for BAME young people from Haringey and Islington – particularly remand and custodial sentences – and introducing an annual or biannual scrutiny panel, including local court representation, to scrutinise those reports.
08. Replicating an action-orientated training focus Prioritise the identification and dissemination of good practice, which can have an immediate impact on practitioners’ day-to-day work, in future iterations of the programme.
09. Boosting parental trust and engagement Consider strengthening whole-family working practices and models, including the creation of parenting worker roles where these do not already exist.
10. Increasing accountability for school exclusions Consider identifying and collating longer-term outcomes for excluded BAME young people, and disseminating this information on a school-by-school basis.
11. Police relations with young people Police Borough Command Units should continue working to strengthen relations with BAME young people.
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9f188e7b57de658b8080b6ad4897d9714cb8850f | What to do with your records if your public body is undergoing a status change
© Crown copyright 2017
You may re-use this information (excluding logos) free of charge in any format or medium, under the terms of the Open Government Licence. To view this licence, visit nationalarchives.gov.uk/doc/open-government-licence or email [email protected].
Where we have identified any third-party copyright information, you will need to obtain permission from the copyright holders concerned.
This publication is available for download at nationalarchives.gov.uk.
1. Introduction ........................................................................................................................................3 1.1 What is the purpose of this guidance? ..........................................................................................3 1.2 Who is this guidance for? ...........................................................................................................4
2. What to do if your public body is undergoing a change in status .................................................4 2.1 The joint information transition team .......................................................................................4 2.2 Action plan ..................................................................................................................................5 2.3 The information survey ...............................................................................................................8 2.4 Reviewing your records to assess value ....................................................................................9 2.4.1 Records for permanent preservation ..................................................................................9 2.4.2 Records with ongoing business value ..............................................................................10 2.4.3 Ephemeral records .............................................................................................................11 2.5 Assigning ownership of records ...............................................................................................11 2.6 Preserving publicly available material .......................................................................................11 2.6.1 Websites ............................................................................................................................12 2.6.2 Datasets .............................................................................................................................12 2.7 Making sure records are still usable after transfer ....................................................................12
3. Introduction
The National Archives is the central advisory body for the care of records and archives, in all media, from creation to long-term preservation. We provide advice to government departments and the wider public sector on the management of digital and paper records, and their selection and transfer to The National Archives.
1.1 What is the purpose of this guidance?
This guidance provides a plan for the actions you must take if your organisation is going through a change to its organisational status.
A change of status may occur due to:
- an organisation selling its shares (privatisation)
- ownership of an organisation being taken on by employees, customers or other stakeholders (mutualisation)
- an organisation being converted into a government owned company
- the dissolution of an organisation
Public records must be safeguarded according to obligations laid down by the Public Records Act, the Freedom of Information Act (FOIA), and any other relevant legislation or codes of practice. Make sure that your successor body is aware of these requirements. Get specialist advice on the management of records held by approved places of deposit from The National Archives as soon as you are aware of proposals for any type of status change.
You must discuss ownership and access rights with your parent department and consult your parent department’s legal and legislative teams as soon as possible to finalise ownership, copyright and intellectual property requirements.
This guidance complements the Machinery of government change guidance suite produced by The National Archives, together with guidance on the Transfer of records, and the Information and Knowledge principles. This guidance gives detailed advice on how to transfer information and whether you will need to transfer to The National Archives, your parent government department, another department or agency, or to a private body. 1.2 Who is this guidance for?
This guidance is primarily aimed at Departmental Records Officers (DROs) or the equivalent role in your organisation. It may also be useful for Heads of Knowledge and Information Management (KIM), Chief Executive Officers (CEOs), change or project managers (anyone within your organisation responsible for managing information risk, or managing change).
2. What to do if your public body is undergoing a change in status
If a decision has been made to change the status of your public body, your information needs to be properly disposed of or transferred to your parent department or successor body. You need to build this into your planning at an early stage. If you are DRO for the public body undergoing a change in status get in touch with your parent department’s DRO and The National Archives as soon as you can to discuss the future management of, and access to, your records. Bear in mind the impact a loss of expertise has on a public body when it is dissolved; take early decisions on the disposal of records and the sensitivity of selected records while such expertise is still available.
If your public body is being privatised you must make sure that your successor body is aware of any obligations laid down by the Public Records Act, the FOIA, and any other relevant legislation or code of practice. You must discuss ownership and access rights with your parent department and consult your parent department’s legal and legislative teams as soon as possible to finalise ownership, copyright and intellectual property requirements.
Note: Department or agency records created prior to privatisation will remain public records after privatisation. Conversely, records created after the date of privatisation are not public records.
2.1 The joint information transition team
The first action you need to take is to establish a joint information transition team including officials from the public body, the parent department and the successor organisation (whichever is applicable). Include expertise from information management, information technology, information assurance and change management. This will help you ensure that information is protected and usable after transition. Your joint information transition team is responsible for information management before, during and after the transition programme.
2.2 Action plan
| Action | Responsibility | Evidence of completion | |------------------------------------------------------------------------|--------------------------------------------------------------------------------|----------------------------------------------------------------------------------------| | Get in touch as soon as you hear your organisation may undergo a change of status: | • Head of KIM or DRO in the public body | • Contact made | | • Contact DRO in your parent department | | | | • Contact The National Archives | | | | Set up information transition team: | • Heads of KIM in parent department and public body | • Team established and remit agreed | | • Include information from a range of disciplines | | • Parent department commits to team remaining in place after status change, until all actions are completed and responsibility transferred to the parent department’s DRO | | • Include staff from the public body | | | | • Include staff from the parent department | | | | Carry out a comprehensive information survey: | • DRO for public body, with guidance from DRO of parent department | • Information survey documented | | • Document your records, their business and operational use and the technology that supports them | | • Major record series identified prior to status change | | • Document legal requirements and | | | | intellectual property rights for each record | | |--------------------------------------------|--| | • Perform a sensitivity review | | | • Share the results with the DRO of your parent department | |
**Review your records:**
- Identify records for permanent preservation and transfer them to your parent department
- Identify records with continuing business use and transfer them to your successor body
- Agree ownership of transferred records
- Assign copyright and intellectual property
- Identify and dispose of ephemeral records
- DRO in public body identifies and reviews records
- DRO in public body transfers documents to parent department
- Transition team is responsible for ensuring transferred records are still usable as required
- DRO in parent department transfers records for permanent preservation to The National Archives or other approved Place of Deposit in due course
- DRO in public body disposes of ephemeral records
- Sensitivity review completed prior to status change
- Records with permanent value or business use transferred to the parent department prior to status change
- Records transferred in a way that ensures they are still usable as required
- Ephemeral records disposed of appropriately prior to status change
- Ownership of records agreed prior to status change
- Crown copyright and Crown database rights assigned to the Controller of HM Stationery Office at The National Archives
- Non Crown copyright and intellectual property rights assigned
**Agree access rights to records:**
- DRO in public body reviews sensitivity
- DRO in parent body
- Sensitivity review completed prior to status change What to do with your records if your public body is undergoing a status change
- Review sensitivity of records
- Agree who has the authority to retrieve and provide access to records once they are transferred to The National Archives, including who will assist in FOI enquiries
| agrees access with The National Archives | Parent department and The National Archives agree access to closed records prior to status change | |------------------------------------------|--------------------------------------------------------------------------------------------------|
**Preserve publicly available material:**
- Ensure websites are captured in the [UK Government Web Archive](https://www.ukgwa.gov.uk) (UKGWA) – see The National Archives' [guidance for digital and records management teams](https://www.ukgwa.gov.uk/guidance)
- Archive datasets as part of your website capture, or transfer them to your parent department. Investigate any planned updates to datasets. If they are yet to be published, ensure they are posted to your website before the date of the final website capture
- Document the technical dependencies, make arrangements for transfer of technology, licences and documentation if
| DRO in public body informs The National Archives' Web archiving team of the need to capture website no later than six weeks prior to status change | Website captured into the UKGWA | | DRO in public body informs The National Archives' Web archiving team of need to capture dataset(s) no later than six weeks prior to status change | Datasets captured as part of the website capture. Unpublished Datasets transferred to the parent department prior to status change | | DRO in public body transfers unpublished datasets and supporting technology, licences and documentation | |
June 2017 What to do with your records if your public body is undergoing a status change
| What to do | Why to do | How to do | |------------|-----------|-----------| | Collect and transfer information on how the data was captured, processed, and arranged. | Identify documents made available for public inspection, agree whether they are still required, and make them available through appropriate sources. | DROs in public body and parent department agree documents required after status change. | | | | Documents previously available for public inspection made available through appropriate sources after status change. | | | Agree selection and disposal of unpublished reports. | DRO in public body and The National Archives agree selection and disposal of unpublished reports. | | | | Reports disposed of, or transferred to the parent department, as agreed, prior to status change. |
### 2.3 The information survey
Your comprehensive information survey should include the information creator, the current owner, the format, and how the information needs to be used. By 'used' we mean how to find, open, work with, understand and trust your information (see The National Archives’ guidance on Digital continuity). For digital information this must include the main software formats and an inventory of all IT hardware and software used for managing and disseminating information (including servers, hard drives, laptops, data sticks, databases, internet/intranet and information held by other organisations).
The information survey should include:
- documentation and records
- email and communication logs
- database and/or file lists
- organisation charts
- contracts with external storage organisations (paper and digital) • previous information surveys/inventories
The survey should cover all the areas information could be stored in, in all media, both physical filing locations and digital ones. Take particular care with personal filing systems, which may contain both original records and ‘working copies’. These must be evaluated by the individual members of staff alongside information management teams, and re-integrated into the main information repositories or disposed where appropriate.
You may have existing surveys or inventories that you can build upon, such as an Information Asset Register (IAR) or a configuration management database (CMDB). The National Archives has produced a range of guidance that can help you to document your information and IT assets (see guidance on Digital continuity, stage 2).
You must review the sensitivity of records of historical value before your public body undergoes a change in status. This means you must identify information that may be exempt from disclosure under the FOIA and the Environmental Information Regulations (EIR).
You must note categories of records with particular storage and handling requirements (for example, sensitive personal data or protectively marked material). Further guidance on reviewing records for sensitivity is available from The National Archives’ website.
2.4 Reviewing your records to assess value
Every record must be assessed for potential historical value and ongoing business value.
2.4.1 Records for permanent preservation
• Identify records of historical value that clearly merit permanent preservation. Consult The National Archives on the method of selection and review • Transfer records for permanent preservation to your parent department. They will transfer them to The National Archives or an approved Place of Deposit as part of a planned transfer of records, at the appropriate time. Records may be transferred directly to The National Archives or an approved Place of Deposit, but only with the written approval of an Information Management Consultant (IMC) at The National Archives • Review the sensitivity of records of historical value before your public body undergoes a change in status. Identify information that may be exempt under the FOIA and the EIR. Note: categories of records with particular storage and handling requirements (for example, sensitive personal data or protectively marked material)
- Your parent department will need to identify officials who are authorised to retrieve on loan and provide access to any selected records when they are eventually transferred to The National Archives
In the case of privatisation, if the successor body want access to records of permanent value that are being transferred to the parent department, they have to requisition them. Ideally the access and loan rights should be agreed with the parent department prior to privatisation.
In most cases the successor body should be given a copy of the record. If this is not possible due to size or cost limitations a formal loan agreement for the original records should be agreed. The agreement should outline access restrictions and should stipulate that requisitioned originals are not damaged in any way, that nothing is added or removed, and that the records are returned as soon as they are finished with – no later than one year after requisition.
If the record has been subsequently transferred from the parent department to The National Archives or another Place of Deposit, the request must still go via the parent department. Access to records of permanent value is something that you may need to discuss on a case-by-case basis with your parent department, the successor body and The National Archives.
2.4.2 Records with ongoing business value
Records with ongoing business value should be transferred to your parent department. This includes records which need to be kept for legal purposes.
In the case of privatisation, if both the parent department and the successor body want the records: transfer them to your parent department. Make arrangements for transfer of technology, licences and documentation if needed. The successor body will need to agree access and loan rights with your parent department, and in some cases they may be given a copy of the record. This is something you should discuss on a case-by-case basis with your parent department, the successor body and The National Archives.
If you do not yet know who your successor body is, you should flag to your parent department that they will need to agree access or loan rights with the successor body once they come into existence. If the successor body wants access to open public records that have already been transferred for permanent preservation: copies can be requisitioned from The National Archives or other Place of Deposit. If copies are not available due to size or cost limitations, the relevant bodies must sign a formal loan agreement. If the successor body wants access to closed public records, they must discuss this with the parent department.
If just the successor body wants the records: you should agree this with your parent department and The National Archives, and transfer records via statutory instrument (or similar, for example a Memorandum of Understanding).
2.4.3 Ephemeral records
Records deemed not worthy of permanent preservation, and not required by your parent department, should be securely disposed of according to approved retention policies.
2.5 Assigning ownership of records
Discuss ownership of records with your parent department’s legal teams as soon as you can, and finalise ownership before your public body undergoes a change of status.
Documents, information and databases produced by Crown bodies are subject to Crown copyright and Crown database right protection, which are centrally managed by the Controller of HM Stationery Office. Copyright and database right for records and databases created by non-Crown bodies can be assigned to the Controller of HM Stationery Office, who will then allow the material to be made available for re-use. You should agree this with your parent body and The National Archives prior to a change in status. It is important that copyright is assigned before a change in status occurs.
If you’re not sure whether you are a Crown body or a non-Crown body, please ask for advice from The National Archives’ Information Policy team – Crown bodies include central government departments, non-departmental public bodies and Executive Agencies.
2.6 Preserving publicly available material
Before your public body undergoes a change in status, consider archiving/capturing websites, datasets, information made available for public inspection, and published/unpublished reports. 2.6.1 Websites
All central government websites (including those of arm’s length bodies) are routinely captured and archived by The National Archives. Your information survey should include websites and you should determine whether you need any supplementary web archiving.
2.6.2 Datasets
According to the government’s transparency agenda, all datasets not containing sensitive data should be published on the organisation’s website, in a format that will enable them to be captured into the UKGWA. Before status change, as part of the information survey, datasets should be reviewed and published wherever possible. Datasets that are too sensitive to publish, but which have been selected for permanent preservation, should be transferred to your parent department in a usable format – along with any supporting information. Your parent department should maintain the dataset until the sensitivity falls away. You must transfer data according to the recommendations in Data Handling Procedures in Government Final Report.
2.7 Making sure records are still usable after transfer
It is vital that the usability of the records is not lost during transfer to your parent body or to the successor organisation. You must maintain the continuity of your information so that you do not lose the ability to find, access, work with, understand and trust the information in the way that you need. For paper records this may mean maintaining filing structures, listing files, or updating catalogues.
For digital records maintaining the continuity of the information may mean transferring or replicating entire technology support systems – it is not enough to transfer the digital files themselves if the recipient does not have the software or hardware to open the files. This is something you need to discuss and agree with your parent department at the earliest opportunity.
These issues must be covered by the information survey and you should consult Information Asset Owners (IAOs), Knowledge and Information Managers, Information Assurance Managers, change managers and IT service providers (both in-house and external) to agree how records need to be used after transfer, and take the actions required to maintain that use. The National Archives’ Digital continuity suite includes guidance on how to maintain digital continuity through change.
If you need any further advice or assistance, please contact the Information Management team at The National Archives: [email protected]
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9fb45cabbdd12cfc4c697de802852eeca9b1e1ff | Diversity and Inclusion Strategy 2020-23
08 December 2020 Contents
Executive summary 2 Our 3 year diversity and inclusion strategy 2 Progress we’ve made so far 3
1. Improve diversity and representation in our workforce 5 Key actions 5 Success measures 6
2. Improve inclusion in ORR 7 Key actions 7 Success measures 8
3. Everyone is engaged in diversity and inclusion 9 Key actions 9 Success measures 10
4. Improving governance and accountability 11 Key actions 11 Success measures 11
Recommendations/Action plan 13
1. Improve Diversity and representative workforce 13
2. Improving inclusion 15
3. Everyone is engaged in diversity and inclusion 16
4. Improving governance and accountability 17 Executive summary
We believe achieving excellence involves becoming a more diverse and inclusive organisation which attracts and retains the best people to work for us.
Having a workforce, where everyone’s contribution is valued and where everyone can flourish, enables us to have richer conversations, be more innovative and better able to respond to the full range of user needs in our work as a regulator. It also helps us to stay relevant and resilient to changing needs of all our stakeholders.
ORR protects the interests of current and future rail and road users, in the public interest, overseeing the safety, value and performance of the railways and monitoring the performance and efficiency of England’s strategic road network. We can do this best by having a wide range of experience within our workforce.
Our 3 year diversity and inclusion strategy
This diversity and inclusion strategy sets out how we plan to further integrate diversity and inclusion into our organisational culture in order to gain maximum advantage from the benefits of having a diverse and inclusive organisation.
For us, diversity means we have a mix of people that represent our communities, each person bringing their unique set of skills, talent and experiences to help us to achieve excellence.
We want to widen representation across all tiers within ORR. We want to continue to attract more diverse talent into the organisation and actively seek out people with potential within the organisation and develop their skills and expertise to create a talent pool from which we can build greater diversity in our future leaders.
For us, inclusion means everyone having a sense of belonging and ability to contribute, as well as being appreciated for the uniqueness of what they bring to enhance the performance of our organisation.
Being an inclusive organisation means demonstrating the behaviours that enable inclusion and reducing behaviours that undermine it. We wish to create a climate where diversity of thought and ideas is welcomed and valued, where we use employees’ knowledge and expertise to maximum advantage.
We developed this strategy by asking a wide range of employees for their views, consulting with experts in the field and reviewing our existing policies. Through this we have identified that the focus of our initial work will be women and black, Asian and minority ethnic (BAME) employees who are underrepresented at senior levels. Alongside this we will continue to work with the Diversity Network to support diversity across all characteristics.
Full details of the evidence for this strategy and recommendations can be found in an associated findings report. We want this strategy to be effective and have included success measures so that we can track our progress year on year.
**Progress we’ve made so far**
This strategy will build on our existing activities and initiatives where we have:
- reviewed job descriptions to encourage a broader range of people to apply
- regularly used blind recruitment for roles across ORR
- taken action to enable more women to move into inspector roles.
- embedded a genuine flexible working approach
- identified and trained Anti-Bullying and Harassment volunteers and this has had a positive impact
- achieved level 2 in the Disability Confidence Scheme
- initiated a programme around wellbeing, enabling people to talk more about mental health
- trained all managers in leading inclusive teams
- regularly garnered the views of a range of employees through our employee conference, focus groups, our diversity network and individual communications and interviews.
- a diversity network initiated by our employees
Our new strategy is set around four objectives:
1. **Improving diversity and representation in our workforce**
2. **Improving inclusion in ORR**
3. **Everyone being engaged in diversity and inclusion** (4) Improving governance and accountability
The following sections outline further details on what each objective covers and the actions recommended.
1. Improve diversity and representation in our workforce
Maximising talent is key to our business and to improving the diversity of our workforce. We believe in the business benefit of and moral imperative for D&I and have seen some progress. This strategy aims to accelerate that change.
We want everybody to feel and see that there are opportunities for progression and a career to pursue in ORR and also across the Civil Service. Women and BAME employees are currently under-represented at senior management levels, including at Board level. Our aim is to address this and to focus on how we provide employees with opportunities and support to progress within the organisation. We have already had some success in increasing the diversity of our workforce through recruitment but the measure of our success is in how we retain these employees and enable them to progress.
We will make better use of schemes such as the Positive Action Pathways (PAP), and other development initiatives such as mentoring and or sponsorships to create opportunities for growth and advancement. We aim to build confidence amongst managers and leaders to encourage greater participation into these and other development opportunities. Furthermore, we want all our managers to feel confident in developing inclusive practices and to help us realise our ambitions, especially for diversity at the senior and top levels.
Key actions
- Identify aspirations, with timescales, for women and BAME representation including at the most senior levels of the organisation
- Continue and extend reviewing job criteria
- Use diverse recruitment panels
- Improve recruitment training, including removing bias (conscious or unconscious)
- Develop a programme of training options for all levels of leaders and managers
- Provide a framework for interviewing for recruiting managers
- Encourage HR scrutiny of recruitment interventions ● Review internal promotion processes to better support progression of under-represented groups
● Promote development and project opportunities for under-represented groups;
**Success measures**
● Greater diversity and evidence of increased representation of BAME employees and women: employee make-up is more representative of regional and national demographics at all levels of the organisation
● No unexplained disparity by group characteristics at each stage of recruitment and employee lifecycle
● Number of successful entries to development schemes increased
● Increased BAME representation at senior levels (Grade B, A and SCS) 2. Improve inclusion in ORR
Improving inclusion is an important business priority for us. We want everyone to take responsibility to ensure all employees are treated with respect in the workplace. We want conversations and considerations around diversity and inclusion to be part of the way we work, not an additional element to consider. We want senior managers to recognise barriers faced by particular groups and take actions to address them.
We want employees to feel confident to address inappropriate behaviour and report cases, without fear or judgement. We have identified and trained Anti-Bullying and Harassment volunteers; we want to rebrand and relaunch their role.
Our flexible working policy enables us to tap into wider talent pools and therefore help us be a better regulator. The opportunities for part-time and flexible working are greatly valued by employees. There is consistency of support of this new way of working. We want to make sure that wherever we can we offer flexible working, recognising that sometimes this may not be possible; however employees must feel that it is fairly and equitably applied.
In order to make informed decisions, we need to understand the make up of the organisation. To achieve this, we will need to improve our diversity data declaration by actively encouraging employees to participate. We recognise the challenges of non-declaration of visible and invisible protected characteristics and the impact of this in developing and monitoring effective interventions. We aim to gain more confidence from employees by implementing this strategy and thereby encouraging more declarations as a result.
Key actions
- Review ORR values to include more explicitly inclusive and respectful behaviours
- Continue to review and communicate the inclusion elements of the employee survey
- Encourage managers to ensure part-time and flexible working employees have similar opportunities as full time employees to showcase their talent
- Encourage the use of the new Dispute Resolution process and ensure appropriate actions are taken • Communicate to all employees around declaration of protected characteristics, framing it not as ‘personal information’ but to ensure there is no discrimination against people for reasons of these protected characteristics
• Review progress and lessons learned with Anti-Bullying and Harassment volunteers
• Establish a programme of training to increase awareness of diversity and inclusion best practice.
**Success measures**
• Managers confidently demonstrate: – behaviours that are inclusive and act as a role model – better understanding of the impact of inappropriate behaviour and exclusion on all of the people they manage – courage, empathy and fairness in the way they manage contentious issues raised by individuals in their teams
• Using the People survey, we can demonstrate improvement in the relevant questions: – no significant disparity in experience of inclusion at work between people from different groups – all employees feel valued, that the workplace is more inclusive and that they experience, respect and dignity at work – employees are more confident that managers will act on concerns they raise about offensive comments and/or inappropriate behaviour at work
• Exit interviews do not indicate a lack of inclusion and respect as a reason for leaving
• Levels of declaration of protected characteristics increase 3. Everyone is engaged in diversity and inclusion
We want to motivate the whole organisation to build commitment and ownership so that improving our diversity and inclusion is seen as a business imperative and not just as an HR or diversity network issue.
We want to tap into the enthusiasm of employees who are keen to contribute to making a difference. We will create a structured activity plan and look for ways to encourage employees to participate in specific activities, with clear briefs, support and recognition for the effort, skills and energy they bring to this work.
We want to support, expand and work in partnership with our existing Diversity network. We will further develop our internal expertise on D&I through the links we have established and membership with external organisations such as Disability Employers Forum, Stonewall and Business in the Community. We will use and leverage resources within the Civil Service.
We want to take an inclusive leadership approach where leaders and managers actively own and drive the implementation of this strategy, role model the behaviours that deliver an inclusive workplace and feel confident in embedding these objectives into our business.
Leaders and managers will be responsible for creating an environment where our people can feel safe to contribute different ideas or challenge the way things are done. We will support leaders to develop and enhance the necessary behaviours through coaching, training or creating facilitated conversations and thinking space.
Key actions
- Expand our D&I capability by senior leaders and managers taking responsibility to develop, resource and support this strategy
- Dedicate more resources to harness the enthusiasm of employees to implement this strategy
- Retain the Diversity network as a employee-led group. Increase their visibility and through this and other targeted activity, encourage more people to join and develop more links with external networks
- Set out clear expectations for managers around D&I responsibilities Review the impact of line managers’ training on leading inclusive teams
Success measures
- Increased D&I activities in the workplace.
- Leaders and managers are more confident in demonstrating inclusive behaviours and dealing with challenging conversations – measured by satisfaction scores relating to inclusion and challenge.
- Diversity network is more visible, has increased in size and has more diverse membership.
- Increased confidence in the role of managers in supporting D&I and on the impact of D&I training
4. Improving governance and accountability
Our CEO, ORR Board and the Executive Committee (ExCo) give their full commitment to the D&I strategy.
We intend to appoint a D&I champion at SCS level to support the CEO and ExCo. The SCS D&I champion will support our Diversity Network and help us develop relevant initiatives over time to ensure that we make good progress.
We will ensure there is a representative on ORR’s Board who brings D&I into decision making.
We will review our Equality policy and make sure that the responsibilities of the leaders in the organisation are clearly set out.
Regular analysis and interrogation of the diversity data will inform interventions, creating a continuous cycle of review and learning. We want our intervention to be data based, in a way that will create a continuous cycle of learning.
Key actions
- Appoint a D&I champion at SCS level
- Review progress against D&I recommendations and action plan annually
- Identify gaps for employee lifecycle data by protected characteristics
- Determine key dashboard indicators with numerical objectives that demonstrate D&I progress.
- Managers identify their own D&I objectives in their performance and development conversations
- Engage RENCO and the Board in D&I
Success measures
- Visible leadership and clear accountability for diversity and inclusion including a D&I champion at Senior Civil Service level and board level
- Robust employee lifecycle data to inform D&I strategy and interventions with clear mechanisms for interrogation and review
- Our CEO, ORR Board and the Executive Committee are seen as advocates for D&I change
# Recommendations/Action plan
## 1. Improve Diversity and representative workforce
| Year 1 | |--------| | **No.** | **Category** | **Recommendation** | | 1.1 | Representation | - Identify aspirations, with timescales, for women and BAME representation taking into account what the wider Civil Service, similar organisations and other regulators have as objectives | | 1.2 | Recruitment | - Review job criteria to include only job requirements – in particular review where women and BAME are under-represented
- Share internal good practice examples around increasing representation | | 1.3 | Recruitment | - Ensure recruitment panels are diverse, including having BAME/disabled representation on panels for SCS roles
- Take proactive steps to increase the diversity of candidate pool using the text in the advertisement, and targeting relevant diverse websites/social media
- Use search agencies where appropriate e.g. for specialist roles where having a more diverse pool of candidates may need support | | 1.4 | Progression | - Managers to encourage development and project opportunities for BAME, women and other under-represented groups:
- Initiate ORR leaders sponsorship scheme including mentoring
- Signpost to existing schemes such as PAP, Future Leaders Scheme and Senior Leaders Scheme
- Hold networking events to raise profile and build relationships and rapport with senior managers | | Year 2 | 1.5 Representation | • Have an ORR board member whose priority is D&I and engage on strategy implementation.\
• Invite D&I experts to come to ExCo occasionally to talk about D&I. | | Year 2 | 1.6 Recruitment | • Identify / develop a training programme for all levels of leaders and managers, across a wide range of areas including recruitment, supporting and managing inclusive teams etc. | | Year 2 | 1.7 Recruitment | • Provide a framework for interview questions for recruiting managers in order to minimise the effect of unconscious bias in question formulation | | Year 2 | 1.9 Progression | • Make adhoc development and project opportunities more transparent and open to all with relevant skills, using expression of interest\
• Use succession planning to develop and facilitate an internal pipeline of employees from groups which are under-represented at senior levels: | | Year 3 | 1.10 Recruitment | • Develop HR scrutiny of interventions for a sample of roles at each stage of the recruitment process in order to\
• Learn what makes the most impact in the recruitment process for D&I\
• Provide assurance of D&I best practice | | Year 3 | 1.11 Representation | • Increase diverse representation on the board:\
• Prepare for board vacancy e.g. identify head hunters that have a good track record of identifying diverse board members. |
## 2. Improving inclusion
| Year 1 | |--------| | **No.** | **Category** | **Recommendation** | | 2.1 | Inclusion and respect | - Reframe the work on bullying and harassment as an agenda for inclusion
- Review ORR values to include inclusive and respectful behaviours more explicitly
- Promote understanding of ORR values and behaviours by recognising and promoting positive examples
- Empower and enable people to challenge behaviours that breach ORR’s values
- Encourage senior managers to lead by example in supporting, promoting and intervening
- Recognise positive promotion of inclusive behaviours in performance reviews | | 2.2 | Inclusion and respect | - Continue to review data on D&I issues from People Survey and other sources, and share findings with managers.
- Encourage managers to suggest and share good practice and/or actions to address the issues identified, with each other and their teams. | | 2.3 | Working patterns | - Encourage managers to support part-time and flexible working employees
- Support managers to ensure that part-time and flexible working employees have similar opportunities as their full time employees to showcase their talent (e.g. meetings, conferences, presentations), making use of technology where possible. | | 2.4 | Inclusion and respect | - Encourage the use of the new Dispute Resolution process. | 2.5 Non-declaration
- Communicate the importance of declaration of protected characteristics to all employees - explain why it is needed, how the data will be used and stored and that confidentiality is maintained
### Year 2
2.6 Inclusion and respect
- Work with the ABH volunteers to review progress on support provided and lessons for the organisation
2.7 Inclusion and respect
- Encourage the continuous use of the new Dispute Resolution and ensure that the organisation is confident that the appropriate actions are taken.
### Year 3
2.8 Inclusion and respect
- Establish a programme of training – online and face-to-face – to increase awareness of diversity and inclusion best practice (see also 1.6)
### 3. Everyone is engaged in diversity and inclusion
#### Year 1
| No. | Category | Recommendation | |-----|----------|----------------| | 3.1 | Resources | Review the responsibilities set out in the Equality Policy and assess adequacy of resources to deliver these as well as our D&I strategy. | | 3.2 | Resources | Recognise progressing our diversity and inclusion agenda as a project which needs resources to be assigned to it, identifying the resource required to deliver the progress within the strategy | | | | Create a structured activity plan and look for ways to encourage employees to participate in specific activities. | | 3.3 | Networks | Confirm and communicate Diversity Network governance (including access to the CEO) with clear Terms of Reference, including attendance by SCS level D&I champion | | Year 2 | 3.4 Networks | Support the Diversity network to increase its membership and visibility | | Year 2 | 3.5 Inclusive leadership | Connect with relevant external networks for greater understanding and confidence in developing more impactful interventions. | | Year 2 | 3.5 Inclusive leadership | Take an inclusive leadership approach that encourages and expects leaders and managers actively own and drive the implementation of this strategy, role model the behaviours that deliver an inclusive workplace and feel confident in embedding these objectives into our business. Include mechanisms for assessing the impact of this programme. | | Year 3 | 3.6 Inclusive leadership | Review the impact of line managers’ training on leading inclusive teams and if appropriate develop further skills based on interactive training on inclusive leadership, coaching and challenging conversations (see also 1.[x]) |
### 4. Improving governance and accountability
| Year 1 | No. | Category | Recommendation | | Year 1 | 4.1 | Governance | Engage with and ensure discussion on the equality policy and D&I strategy, especially at ExCo, RENCO and senior manager level. | | Year 1 | 4.2 | Governance | Appoint a D&I champion at SCS level with responsibilities for: | | Year 1 | 4.2 | Governance | providing input to the CEO | | Year 1 | 4.2 | Governance | facilitating liason between Diversity Network and ExCo | | Year 1 | 4.2 | Governance | liaising on D&I strategy with ExCo, RENCO and the Board | | 4.3 Data | • Undertake an audit of employee lifecycle data by protected characteristics with reference to requirements of the Equality Act 2010, and Civil Service Standards which relate to D&I. • Resolve data gaps to enable monitoring and regular interrogation of the full employee life cycle by protected characteristics – in particular around advancement (including training and development uptake, temporary promotion, progression) and exit interviews • Review the gender pay gap annually by following through identified actions • Undertake BAME pay gap analysis and use the output to identify how BAME representation is changing and as an ongoing proxy measure for BAME progression |
| 4.4 Review progress | • Annual reporting on D&I – reviewing progress against plan and resources. |
| Year 2 |
| 4.5 Governance | • Encourage managers or their line managers to identify their own D&I objective/s. • In performance reviews, ask all managers to set out what they have done in support of the D&I Strategy e.g. developing women or BAME employees or others with protected characteristics • Encourage managers to provide evidence where possible of progress e.g recruitment data. | | | | | |---|---|---| | 4.6 | Governance | • Engage RENCO and the Board in D&I to support their oversight role, including putting in place regular data and progress reporting to the Board/RENCO | | 4.7 | Data | • Data review – Identify key dashboard indicators and numerical diversity / recruitment objectives that demonstrate progress e.g. recruitment diversity data throughout the process. | | 4.8 | Review progress | • Annual reporting on D&I – reviewing progress against plan and resources. |
**Year 3**
| | | | |---|---|---| | 4.9 | Data | • Data review – Identify key dashboard indicators and numerical diversity / recruitment objectives that demonstrate progress e.g. recruitment diversity data throughout the process. | | 4.10 | Review progress | • Annual reporting on D&I – reviewing progress against plan and resources. |
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8194ed63cdae346d0f49723e33383921dd66445d | Food Standards Agency
Equality and Diversity Objectives: April 2012
Contents:
Introduction Background FSA Diversity Policy Statement Public Sector Equality Duty Equality and Diversity Objectives Monitoring and Measuring Progress Continued Actions
Appendix 1: FSA Equality and Diversity Objectives and Supporting Actions
1. Introduction
1.1 The Food Standards Agency (FSA) is committed to creating and maintaining an inclusive environment. Promoting equal opportunity and valuing diversity help to make the FSA more effective in understanding its varied and diverse consumer base, and ultimately in achieving its strategic objective of safer food for the nation.
1.2 This report supplements the FSA Diversity Report published in January 2012 (see http://www.food.gov.uk/aboutus/how_we_work/equality) and
- summarises the FSA’s strategic direction in respect of equality and diversity;
- provides information about how the FSA has met and will seek to continue to meet the equality duties at a strategic level;
- sets out the FSA’s equality priorities and measurable objectives from 2012; and
- sets out arrangements for monitoring, measuring and reporting progress.
2. Background
2.1 The FSA is a non-ministerial government department set up by an Act of Parliament in 2000 to protect the public’s health and consumer interests in relation to food.
2.2 The FSA is the central competent authority responsible for food safety and food and feed hygiene across the United Kingdom. It works with other enforcement bodies to enforce food safety rules and has staff who work in GB meat plants to check that the requirements of the regulations are being met. In Northern Ireland the Department of Agriculture and Rural Development carries-out meat inspection controls on behalf of the Agency. The FSA also commissions research and carries-out surveillance related to food safety. In Scotland and Northern Ireland, the FSA has responsibility for nutrition and in Northern Ireland, Scotland and Wales, has responsibility for food labelling including allergen labelling.
2.3 The six outcomes the FSA aims to deliver are:
- foods produced or sold in the UK are safe to eat;
- imported food is safe to eat;
- food producers and caterers give priority to consumer interests in relation to food;
- consumers have the information and understanding they need to make informed choices about where and what they eat;
- regulation is effective, risk-based and proportionate, is clear about the responsibilities of food business operators, and protects consumers and their interests from fraud and other risks; enforcement is effective, consistent, risk-based and proportionate and is focused on improving public health.
2.4 These outcomes are supported by the FSA’s core principles of:
- putting the consumer first;
- openness and transparency;
- science and evidence-based;
- acting independently;
- enforcing food law fairly.
3. FSA Diversity Policy Statement
3.1 The FSA’s Diversity Policy Statement, published in May 2010, sets out the FSA’s commitment to providing equality of opportunity and eliminating all forms of discrimination, harassment and bullying. The FSA is committed to promoting a good and harmonious working environment in which everyone is treated with respect and will not tolerate discrimination, bullying and harassment of any kind. The FSA will take any complaint seriously. Individuals will not be penalised for raising a complaint in good faith, even if the complaint is not upheld.
3.2 All FSA employees and individuals working under contract arrangements are required to assist the FSA to meet its commitment to provide equal opportunities in employment and avoid unlawful discrimination, harassment and bullying.
4. Public Sector Equality Duty
4.1 The public sector equality duty was created by the Equality Act and replaces the former race, disability and gender equality duties. The duty came into force on 5 April 2011 and covers age, disability, gender, gender reassignment, pregnancy and maternity, race, religion or belief and sexual orientation (known as protected characteristics).
4.2 The general duty requires that the FSA has due regard to:
- eliminate unlawful discrimination, harassment and victimisation;
- advance equality of opportunity between people who share a protected characteristic and those who do not; and
- foster good relations between people who share a protected characteristic and those who do not.
4.3 The general public sector equality duty seeks to mainstream and integrate consideration of equality and good relations into day to day business. It requires equality considerations to be reflected in the design of policies and the delivery of services, including internal policies, and for these to be kept under review. Whilst compliance with the duty is a legal obligation, it equally makes good business sense – for example, in terms of the development of a supportive working environment and the provision of services to meet the diverse needs of users.
4.4 The specific public sector duties are aimed at assisting public authorities in the better performance of the general public sector duty. In January 2012, as required by the specific duties, the FSA published its Diversity Report (available on the FSA website - see paragraph 1.2 above) which includes information regarding the FSA’s workforce profile, in addition to its work and commitment to promoting diversity in a number of key areas, including learning and development, recruitment and engagement with external stakeholders. This information will be updated and published annually.
5. Equality and Diversity Objectives
5.1 The specific duties also require public bodies to prepare and publish at least one specific and measurable equality objective to help the organisation better perform the general equality duty, focusing on immediate priorities and outcomes to be achieved. The FSA objectives and supporting actions are set out at Appendix 1. These objectives and subsequent outcomes will help the FSA secure improvements in service delivery and the employment of its staff. In addition to these specific objectives, the FSA will continue to promote and extend diversity in a number of other ways some of which are summarised in section 7 below.
Consultation and engagement
5.2 The development of the FSA’s equality objectives has been informed by the evidence gathered and analysis undertaken to produce the FSA’s Diversity Report and through consultation across the organisation. The equality objectives have been shaped by views and comments from FSA staff, via
- FSA Staff Group;
- Continuous Improvement Group;
- Anti-Bullying and Harassment work programme;
- FSA’s recognised Trade Unions; and
- Executive Management Board.
Reductions in reports of workplace bullying and harassment
5.3 In 2011 the FSA commissioned an independent survey and follow-up research aimed at better understanding the scale and the experience of staff in meat operations in respect of harassment and bullying. Bullying and harassment is not something which any individual should have to experience and it is also not something that any individual should stand by and watch. Whilst staff recognise that the FSA is addressing the issue, there is more that can be done. The FSA’s equality and diversity objectives reflect this ongoing commitment and build upon previous work in this area, which has included:
- the placement of at least one anti-bullying poster in each FSA office in each plant. The posters convey a strong message and give details of how to obtain further information if staff feel threatened at work; and
- a Code of Conduct which has been widely distributed and applies to all staff working in the operational environment, and includes FSA staff, contract staff as well as Food Business Operators and their own staff;
- *Guidance on dealing with situations of conflict* distributed to all meat operations staff; and
- the publication of case studies including support for lone workers, FSA success in the courts and in tackling obstruction.
(Note: all of the above are available to all FSA staff on the FSA’s intranet).
Findings from the 2011 People Survey reported a slight decrease in staff reporting personal experience of harassment or bullying at work from 22% in 2010 to 19% in 2011. The FSA is aiming to see this trend continue with a year on year reduction in this area.
**Comprehensive workforce data**
5.4 Following the workforce analysis undertaken to produce the FSA’s Diversity Report in January 2012, the FSA committed to completing a more detailed analysis of its workforce profile, including an analysis by grade in respect of age and declarations of disability, ethnicity, sexual orientation and religion and belief. This analysis will help the FSA identify any under-representation within the workforce, and will subsequently assist the FSA in determining areas where positive action might usefully be explored to support an increase in representation. This is an area of work that has been prioritised following consultation with the Trade Unions and staff. This work will be supported in the longer term by the implementation of a communications strategy encouraging all staff to review and, where necessary, update existing personal data. Current declaration rates, together with future targets are shown in the table below:
| | Declaration rates: April 2012 | Declaration rates; Target April 2015 | |------------------|-------------------------------|-------------------------------------| | Ethnicity | 94% | 98% | | Disability | 95% | 98% | | Religion or belief | 23% | 50% | | Sexual orientation | 23% | 50% |
The above are just two of the proposed actions that will help the FSA in establishing comprehensive workforce data and subsequently identifying barriers to equality and measuring progress towards an inclusive working environment. Procurement
5.5 The FSA is keen to ensure that those suppliers who contract with the FSA demonstrate that reasonable and practicable steps are taken to facilitate equal access and treatment in employment and service delivery. To support this, the Procurement Team will ensure that all potential suppliers are aware of the provisions within the FSA’s Diversity Policy Statement and that diversity requirements feature in the tendering stage of the procurement process through to the conditions of contract.
Behaviour and culture change
5.6 To further support a culture which embraces and fosters good relations promoting an environment where equality and diversity are embedded within the day to day activities of all staff, the FSA is proposing a number of ongoing actions aimed at raising awareness. These include: the production and roll-out of training material focusing on equality analysis and diversity considerations in recruitment and selection; and use of the FSA’s intranet to raise the profile of equality and diversity. A further action supporting this objective and one which has also been informed by discussions with the Trade Unions is the commitment to review the results of the 2011/12 performance review round. The FSA introduced a new Performance Review Scheme in April 2011 in which assessments are based upon evidence of performance, demonstration of competencies and achievement of objectives. Training has been delivered to all team leaders with the aim of securing quality and consistency of scoring and the prevention of bias and discrimination.
5.7 Progress towards this objective will be reflected in the results of the annual People Survey. The third People Survey was completed in 2011 and results showed a small improvement compared with previous years. It was encouraging that more FSA staff completed the survey in 2011 – the response rate was up to 82%. Similarly, the FSA’s engagement index also showed an increase of 3 percentage points to 51%. (This is only 4 percentage points below the Civil Service benchmark). Taking into account the survey results in 2010, the findings showed small improvements in positive scores across most of the themes and the FSA aims for this trend to continue in future years. The findings from the Survey will be taken into account in progressing the FSA’s Organisational Improvement Programme (OIP). The OIP is an important tool in the delivery of the improvements required in the FSA that will ensure the delivery of strategic priorities and improve working lives. In the longer term and with the support of the outcomes delivered by the OIP, by April 2015, the FSA would expect to see its employee engagement index equal or exceed the Civil Service Benchmark.
6. Monitoring and Measuring Progress
6.1 Progress in implementing and achieving the FSA’s equality objectives will be monitored and reported. Update reports will be provided to the Executive Management Board and Trade Unions and published on Foodweb, the FSA’s internal intranet, to ensure that they are accessible to all staff.
6.2 In measuring progress, the FSA will benchmark against the wider Civil Service; progress towards Cabinet Office targets in respect of women, disability and ethnicity in the Senior Civil Service; and the findings from the People Survey. It will also use the information gathered during the completion of equality analysis undertaken in respect of HR and other FSA policies / practices.
6.3 Progress will be reported within the FSA’s Diversity Report which will be published annually.
7. Continued Actions
7.1 In addition to the specific and measurable objectives outlined above and set out in more detail at Appendix 1, the FSA will continue to embed a number of additional diversity initiatives, including:
- the Flexible Working Patterns Policy, launched in February 2012, extended the opportunity to request a flexible working pattern to all staff. The FSA offers a range of flexible working options allowing staff to meet their work-life balance requirements. However, due to the operational delivery requirements and pressures faced by some roles across the FSA, it is recognised that flexible working options are not always practical for all staff;
- the establishment and promotion of a Childcare Voucher Salary Sacrifice Scheme;
- continued progression of the FSA’s harmonisation programme to embed a single approach to HR management, introduce a single set of new HR policies and procedures; and to more closely align the terms and conditions of employment. A key objective of the FSA harmonisation programme is to ensure that staff are treated in a fair, equitable, and consistent manner. Over the past 12 months the FSA has addressed some of the differences through the introduction of new HR policies, including Diversity Policy Statement and more recently the Flexible Working Patterns Policy. An Equality Impact Analysis is conducted on each new and revised HR policy. This harmonisation project is working within a timeline that runs from 2011 to 2015 and changes will need to be made through a process of engagement with staff and the recognised trade unions. For example, the Policy Advisory Group comprising of representatives from across the FSA will help to shape future HR policies, guided by template policies provided by Civil Service Employee Policy (CSEP);
- the continued development of learning and development programmes to support diversity, both in terms of content and in ensuring equal and fair access to learning opportunities;
- taking an active part in the re-fresh of the Professional Skills for Government Competency Framework for the Civil Service. The framework encompasses a wide range of values and behaviours, and supports principles of fairness of opportunity;
- the ongoing development and expansion of the FSA’s dedicated Diversity pages on its intranet which seeks to support openness and transparency in respect of the FSA’s approach to diversity and workforce data. The Diversity pages will continue to be populated with diversity data and guidance for staff and managers;
- the completion and publication of equality analysis reports, particularly in respect of the ongoing policy development and the HR harmonisation programme.
The FSA undertakes Impact Assessments (IA), or in Scotland the Business and Regulatory Impact Assessments (BRIAs), for every policy proposal (legislative and non-legislative). IAs and BRIAs consider all possible benefits and risks of those proposals whilst also taking on board social issues such as health and equality, sustainability aspects, costs to specific sectors as well as enforcement and implementation issues. IAs and BRIAs are used across Government Departments as a standardised policy-making tool and require policy makers to consider any impacts on protected groups under the Equality Act. The FSA has recently updated its guidance on completing impact assessments to incorporate a checklist including completing equality impact assessments. In addition, the FSA is planning to update its guidance regarding consultation and this will outline methods of engagement to ensure that minority groups are fully involved where appropriate. Equality Impact Assessments relating to external facing FSA policies are published on the FSA’s website liked from Impact Assessments at: www.food.gov.uk.
- maintenance of the Two Ticks positive about disabled people scheme; and
- continued commitment to undertaking equal pay audits and to investigate any disparities.
7.2 In addition to the initiatives outlined above focusing on the development of and inclusiveness within the workforce, the FSA will continue to engage (either directly or through associated organisations) with consumers from minority groups and / or who are more vulnerable and disadvantaged to ensure their views and concerns are heard and taken into account. In planning how, when and with whom engagement takes place, the needs of consumers with protected characteristics will be considered in parallel with the policy that is being developed. This is to ensure that where policy development or regulatory changes are taking place any disproportionate or adverse effect on consumers with protected characteristics are examined as part of the consumer engagement development phase and tailored engagement with those consumers or representatives is conducted. For example, previously the FSA has engaged directly with Muslim and African Caribbean populations when researching risks associated with consuming sheep and goat products. Currently, the FSA is working alongside community representatives to determine the most effective way of communicating messages regarding the potential carcinogenic effects of consuming the Betel (Areca) nut which is traditionally consumed by members of the South East Asian community. Additionally, the FSA is currently planning to engage with consumers using its Citizens Forum mechanism to explore consumer views on two specific areas, firstly the expansion of the Food Hygiene Rating Scheme (FHRS) and secondly in respect of the review of Official Controls Delivery in the UK. The Citizens’ Forums currently provide an effective method for the FSA to capture consumer views, opinions and develop insight especially around complex food safety issues where there is likely to be limited base knowledge or, indeed, where consumers have no awareness of the topic at all. The FSA is keen that in this work any potentially vulnerable or disadvantaged consumers are identified so that the FSA may tailor make a consumer engagement approach for these key work areas.
7.3 For a number of years the FSA in Scotland has carried out work with ‘seldom heard’ groups and their representatives. The purpose of their consumer engagement events is to listen and engage with individual consumers to gain an insight into their views, attitudes and different needs and in doing so, as recommended by the Advisory Committee on Consumer Engagement, the FSA in Scotland has formed partnerships with organisations connected to different sections of the community. The cases studies below provide further information regarding the work that has been undertaken both in Scotland and the wider FSA.
**Case Study: Engaging with the deaf community**
There are around 9,000,000 deaf or hard of hearing individuals in the UK, 688,000 of whom are severely to profoundly deaf. Around 55,000 people use British Sign Language (BSL) as their first or preferred language. BSL was recognised as a language in its own right in March 2003.
In 2010 the FSA in Scotland focused efforts on engaging with members of the deaf community in Scotland. This group was chosen following discussion with representatives of Deaf Connections – a Glasgow based organisation which provides support services to the deaf community in the West of Scotland. The discussion highlighted issues not previously considered, such as the difficulties presented in reading written English to an individual whose first language is BSL.
The FSA’s objectives in this work were:
- to listen to and engage meaningfully with deaf people in order to gain an insight into their attitudes, opinions and feelings;
- to build effective relationships with organisations already in contact with deaf people;
- to allow their views, attitudes and specific needs to be taken into account and to help shape future communication strategies/campaigns;
- though recognising the limitations of this, to increase awareness of and improve penetration of the FSA and its key messages.
The FSA in Scotland gathered groups of 9 - 15 people in 3 separate locations across Scotland, so the groups were small enough to allow everyone the opportunity to express their views but large enough to provide diversity of opinions. The services of BSL signers and note-takers were used to facilitate the events. The groups were very enthusiastic and delighted that their views were seen as important. Discussions highlighted some confusion over “use by” and “best before” dates, which had been noted in discussions with other groups, and a desire for some food safety advice being presented in a format more accessible to the deaf community. Leaflets and information on websites were not seen as the best way to engage with or to get information across to the deaf community, instead suggestions for webclips and / or DVDs with BSL were given.
Following these events the FSA in Scotland continued to engage with Deaf Connections, particularly in the lead up to Food Safety Week 2011, and through FSA funding for Food Safety Week partners they were able to help the FSA in Scotland get their food hygiene messages out to people in the deaf community by producing an accessible BSL version of Food Safety Week’s ‘Kitchen Confidential’ DVD. They showed this at a number of health information and healthy eating events as well as quiz nights for deaf people in the Glasgow Deaf Centre. The BSL version has also been uploaded onto their website for wider circulation.
Deaf Connections were also in the process of refurbishing their community kitchen to deliver cookery, healthy eating and food hygiene courses for people in the deaf community and through FSA in Scotland funding they were able to complete this refurbishment, in addition to staff and volunteers undertaking food hygiene training in advance of the community café opening. A hand hygiene training kit was also purchased which will be used for food preparation demonstration events and healthy eating cookery classes. Fridge thermometers will also be distributed by Deaf Connections home care service to service users who will be given advice on their use. This will give staff an opportunity to advise on The 4C’s of Food Hygiene.
Case Study: Hygiene, Healthy Eating and Activity Projects in Schools (HHEAPS) Pilot for Special Educational Needs (SEN) Schools
The Hygiene, Healthy Eating and Activity in Primary Schools (HHEAPS) initiative has developed over 5 years from 2 pilot projects with Aberdeen Football club into a highly respected and successful resource delivering food hygiene, healthy eating and activity messages to P4-6 pupils.
The concept of using role models such as sports coaches proved to be a powerful one and following the pilots key partnerships were established with Scottish Rugby, Scottish Football Association, Tennis Scotland and the Active Schools network. By March 2011 just under 54,000 pupils in more than 900 schools all across Scotland had taken part in the HHEAPS programme.
The FSA’s objectives for this work are to:
- continue use of positive role models to link with classroom activities & promote children’s awareness of food hygiene, healthy eating and fitness;
- continued alignment with both FSA and Scottish Government strategic outcomes and priorities;
- build on established partnerships and develop the HHEAPS resource to extend its reach across Scotland;
- improve the knowledge of food hygiene and nutrition in approximately 15,000 children each year throughout Scotland;
- develop and pilot a Special Educational Needs (SEN) version of HHEAPS during 2011-12.
HHEAPS is designed to be delivered over a continuous 6 week period with each classroom activity lasting approximately 1 hour. There are 6 activity sessions to complete (3 food hygiene and 3 healthy eating), to maintain linkage, the first coaching session should immediately follow completion of classroom Activity 1 (& so on).
It was clear that there was also a demand for a SEN version which was highlighted in teacher’s feedback forms in addition to feedback from Teacher’s Panels (one of the FSA in Scotland’s other school related projects which allows engagement with teachers face to face to evaluate resources and initiatives).
A SEN version of the Mission Book has now been created following feedback on 2 previous versions from SEN teachers. The book is now in A3 format as opposed to A4, with more pictures and limited text and is accompanied by more hands on practical activities. To help develop suitable materials and activities representatives from the FSA in Scotland visited an Autism Unit in Glasgow to meet some of the children and have a look at some of the teaching materials and resources they currently use.
One of the FSA in Scotland’s current partners Tennis Scotland will be working with the FSA on the SEN pilot through their Disability Tennis Development Manager. Tennis Scotland had already sent out 36 Special Equipment Packs to schools in Scotland and working with Glasgow’s Active Schools co-ordinator they have identified 8 SEN Schools to take part in the 6 week pilot programme. The pilot was due to start mid February but due to school timetables this has been rearranged for April 2012. All the resources have been sent out to Tennis Scotland and they will disseminate to schools taking part and deliver the coaching sessions during the pilot.
Feedback from all schools and teacher’s involved will be gathered and used to make any further amendments to the Mission Book, teacher’s guide and coaches cards. Feedback on the resources accompanying the Mission Book will also be gathered and it is hoped that a final version can then be agreed and rolled out to SEN schools across Scotland in 2012-2013.
Case Study: Working effectively with minority ethnic food businesses
“Working effectively with minority ethnic food businesses” is a bespoke, one day training course for Local Authority food law enforcement officers which was developed by the FSA in 2008. The aim of the course is to help these officers develop a better understanding, awareness and confidence in working with diverse community groups with different religious, cultural and dietary practices and forging effective business relationships to ensure compliance.
The training course is held on an annual basis, and in addition is complemented by a handbook, available on the FSA’s website, which is designed to be a practical day-to-day resource for Local Authority food law enforcement officers. (This handbook is currently under review and is being updated to reflect feedback received in respect of additional guidance requests).
7.4 Together with the specific objectives and actions set out in Appendix 1 the actions and initiatives outlined above will help the FSA to create and maintain an inclusive environment and enhance understanding of its varied and diverse consumer base. Appendix 1:
FSA Equality and Diversity Objectives and Supporting Actions
The general duty requires that the FSA has due regard to:
- eliminate unlawful discrimination, harassment and victimisation;
- advance equality of opportunity between people who share a protected characteristic and those who do not; and
- foster good relations between people who share a protected characteristic and those who do not.
The Objectives and supporting actions set out below seek to assist the FSA in meeting and demonstrating these requirements.
Progress will be monitored and reported. The FSA will continue to consult and engage on the ongoing relevance of these objectives and actions and the inclusion of additional priorities. **Objective 1:** The reduction of staff reporting incidents of harassment and bullying at work, supporting a culture where staff can develop to their full potential and differences are embraced.
**Outcome:** A year on year reduction of staff reporting, via the People Survey, personal experience of harassment and bullying at work.
| Actions | Date | Lead Responsibility | |------------------------------------------------------------------------|---------------|----------------------------------------------------------| | Launch of Anti-Bullying and Harassment Adviser Network as a support option for staff. | April 2012 | Chair of the Anti-Bullying and Harassment Working Group | | Provision of clear leadership on tackling harassment and bullying issues within teams to be provided to team leaders within the new Operational management structure. | From April 2012 | Chair of the Anti-Bullying and Harassment Working Group | | The production of a special edition of *The Inspector* focusing on bullying and harassment. | May 2012 | Chair of the Anti-Bullying and Harassment Working Group | | Development and launch of a dedicated compulsory e-learning module. | September 2012 | Chair of the Anti-Bullying and Harassment Working Group | | Extend the external independent research commissioned in 2011 to assess cultural acceptance and root causes of harassment and bullying. | December 2012 | Chair of the Anti-Bullying and Harassment Working Group | | Further external independent questionnaire issued to staff in Operations to measure progress against the 2011 results. | Summer 2013 | Chair of the Anti-Bullying and Harassment Working Group | Objective 2: To improve declaration rates with the aim of establishing more comprehensive workforce data to assist in identifying and addressing barriers to equality and measuring progress towards an inclusive working environment.
Outcome: By April 2015, declaration rates to have increased to: 98% in respect of ethnicity and disability; and 50% in respect of religion or belief and sexual orientation
| Actions | Date | Lead responsibility | |------------------------------------------------------------------------|-----------------------|----------------------------------------------------------| | (i) Expand the workforce analysis undertaken within the FSA Diversity Report (January 2012) to analyse in more detail the FSA workforce profile by grade and key protected characteristics (ii) with the aim of identifying under-represented minority groups and exploring areas for potential positive action initiatives. | (i) September 2012 | HR Employee Relations and Policy Manager | | | (ii) Summer 2013 | | | Review the collection and recording of diversity and equality information to improve equality and diversity monitoring. | September 2012 | HR Systems and Reward Manager | | In line with the specific duties of the public sector equality duty, to produce and publish the FSA’s Diversity Report providing information relating to those who share a relevant protected characteristic who are FSA employees and others affected by its policies and practices. | January 2013 and annually thereafter | HR Employee Relations and Policy Manager | | Review the collection of diversity information in both external and internal recruitment exercises to ensure that appointments to the FSA continue to be made on merit following fair and open competition and are non-discriminatory. | April 2013 | HR Resourcing Team Manager | | Develop and implement a communications strategy encouraging all staff to review and, where necessary, update existing employee data on disability, ethnicity religion or belief and sexual | April 2015 | HR Employee Relations and Policy Team | orientation with a view to achieving a 98% declaration rate in respect of ethnicity and disability; and 50% in respect of religion or belief and sexual orientation. Objective 3: The FSA is committed to pursuing a comprehensive policy of equal opportunities in procurement in its dealings with other stakeholders, internal and external customers, as well as members of the public. So far as is reasonably practicable and within the law, no-one shall receive less favourable treatment on the grounds of sex, marital status, sexual orientation, age, family circumstances, disability, colour, race, nationality or ethnic or national origins, religious or political beliefs, or be disadvantaged by conditions or requirements that cannot be shown to be justifiable.
Outcome: The FSA recognises its responsibility under law to promote equality. In relation to procurement, it will adhere to its responsibilities under legislation to take equality into account when procuring goods, works or services from external providers. In so doing the FSA will require all vendors to give basic information of compliance with various legislations that apply.
| Actions | Date | Lead responsibility | |------------------------------------------------------------------------|------------|------------------------------| | Ensure that all suppliers are aware of the provisions within the FSA’s Diversity Policy Statement | Ongoing | Head of Procurement | | To include diversity related evaluation criteria in the tendering stage of the procurement process | Ongoing | Head of Procurement | | Review and revision of standard FSA contract conditions to commit suppliers to comply with relevant equality legislation | July 2012 | Head of Procurement | | All FSA procurement staff to complete the Civil Service Learning e-learning module *Introduction to Diversity* | July 2012 | Head of Procurement | | Review and revision of the FSA’s Procurement Policy and procedures to ensure that equality legislative requirements are met | September 2012 | Head of Procurement | Objective 4: Encourage behaviour and culture change to support all staff to reach their full potential and to proactively embed equality and diversity in their day to day work.
Outcome: the FSA employee engagement index to equal or exceed the Civil Service Benchmark by April 2015.
| Actions | Date | Lead responsibility | |------------------------------------------------------------------------|------------|----------------------------------------------| | Complete the roll-out of a training module for managers to complement the FSA Recruitment and Selection Policy | June 2012 | HR Resourcing Manager | | Undertake an equality analysis following the completion of the 2011/12 performance review process to ensure there are no unintentional discriminatory effects in its application. | December 2012 | HR Employee Relations and Policy Manager | | Feature a “Diversity Awareness” month on the FSA’s intranet | April 2013 | HR Employee Relations and Policy Manager | | To develop and introduce an Equality Analysis e-learning module. | September 2013 | Employee Relations and Policy Manager | | Provide guidance to support the inclusion of an equality-related personal objective for all staff to be assessed as part of the performance review scheme. | April 2013 | HR Employee Relations and Policy Manager | | All staff to complete the Civil Service Learning e-module as a refresh to workplace diversity and an overview on equality legislation. | April 2014 | FSA Team Leaders to ensure that all staff complete the module. |
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9342a8d087a60bf5d065a80875fa6aa7d719f61f | ## Contents
01. About the FSA .................................................................................................................. 2
02. Scope of the 2016 report.................................................................................................. 2
03. Introduction ...................................................................................................................... 3
04. Summary of 2016.............................................................................................................. 3
05. Our people – facts and figures ....................................................................................... 6 5.1. FSA Workforce profile ............................................................................................... 6 5.2. Grade profile ............................................................................................................. 6 5.3. Age profile ............................................................................................................... 6 5.4. Gender ...................................................................................................................... 7 5.5. Disability .................................................................................................................. 9 5.6. Ethnicity .................................................................................................................. 9 5.7 Sexual orientation ..................................................................................................... 11 5.8 Religion and Belief ................................................................................................... 12 5.9 Working patterns ....................................................................................................... 12 5.10 Leavers / Exits ......................................................................................................... 15 5.11 Discipline and Grievances ....................................................................................... 16
06. Recruitment ..................................................................................................................... 17
07. FSA Performance Management Scheme ....................................................................... 19
08. Learning and Development ............................................................................................ 22
09. Equal Pay Audits ........................................................................................................... 23
10. Consumer Engagement ................................................................................................. 23 10.1. Consumer segmentation ....................................................................................... 23 10.2. FSA Voices ........................................................................................................... 24
11. Stakeholder Engagement ............................................................................................... 25
12. Policy Development ....................................................................................................... 25
13. Accessibility .................................................................................................................... 26
14. The FSA’s Welsh Language Policy ............................................................................... 26
15. Our Ways of Working ................................................................................................... 27
16. Civil Service People Survey .......................................................................................... 28
17. Bullying and Harassment .............................................................................................. 29
18. Conclusion ..................................................................................................................... 30 Appendix ............................................................................................................................. 31
19. About the FSA
1.1 The Food Standards Agency’s roles and responsibilities are set out in the Food Standards Act 1999. This states that the main objective of the Agency in carrying out its functions is to protect public health from risks which may arise in connection with the consumption of food (including risks caused by the way in which it is produced or supplied) and otherwise to protect the interests of consumers in relation to food.
1.2 The FSA is committed to putting consumers first in everything we do. In protecting consumers’ interests in relation to food we shall ensure that “food is safe and what it says it is, and we have access to an affordable healthy diet, and can make informed choices about what we eat, now and in the future”. The FSA’s focus is on three main themes which need to be addressed and balanced to get the best overall outcomes for consumers and to ensure food we can trust, namely:
- the right to be protected from unacceptable levels of risk
- the right to make choices knowing the facts
- the right to the best food future possible.
2. Scope of the 2016 report
2.1 Under the Equality Act 2010, the FSA as a public body has a duty to publish relevant proportionate information annually to demonstrate compliance with the Public Sector Equality Duty. The information which we publish seeks to show that the FSA has paid ‘due regard’ to the three aims of the general Equality Duty, namely to:
- eliminate unlawful discrimination, harassment and victimisation and any other conduct prohibited by the Act;
- advance equality of opportunity between people who share a protected characteristic and people who do not share it; and
- foster good relations between people who share a protected characteristic and people who do not share it. 2.2 This report presents a high level summary and overview of equality data, including workforce profiles and monitoring data / information for employment activities. The information presented represents the position as at 1 November 2016. The report contains a mix of qualitative and quantitative data. The figures in this report are based on a headcount total of 1077 members of staff and are taken from FSA’s iHR System unless otherwise stated. Staff not paid directly by FSA are not included in the analysis, nor are agency staff/contractors.
3. Introduction
3.1 Our diversity vision remains at the forefront of our thinking and development of diversity and inclusion initiatives supporting not only our own employees, but also how we consider and respect diversity in terms of consumers and stakeholders. This report demonstrates our achievements over the year.
This is the FSA’s sixth report under the Public Sector Duty. For copies of previous reports see: http://www.food.gov.uk/about-us/data-and-policies/equality/
4. Summary of 2016
4.1 We have continued to support initiatives and build on our own internal activities in the following areas over the past year:
- Supporting a number of individuals on CS wide initiatives, such as the Crossing Thresholds programme, the Women in Leadership programme and the Positive Action Pathway cohorts.
- Launch of an FSA Women Network to create a forum to help provide support for both women and men to build confidence and knowledge to further their career. This also enables the sharing of development activities or events that are happening in the cross government women networks as well as events that we want to run ourselves.
- Launch of a randomised networking scheme in September 2016 that was created to support the development of people from all backgrounds within the FSA, giving the opportunity to team up with another FSA employee and learn more about the diverse range of work being carried out across the FSA.
- The ‘Give it a Go’ pilot from Dec 2015 to March 2016 to try out smarter ways of working and develop more productive ways of working in terms of the tools, skills and physical spaces we use, saw a sustained 20% increase in remote working across all the office based staff following the end of the pilot phase. And in terms of recruitment – both internally and externally, we have been able to recruit a number of remote and flexible working staff in 2016.
- Development of a Black, African and Minority Ethnic network
- Design of structured support and guidance for employees who have Dyslexia.
4.2 And in terms of non-HR related aspects of diversity activity:
- we have continued to develop our understanding of different groups of consumers when developing communications activities, such as the Food Safety Week and Rare Burger campaigns.
- Creation of a staff advocacy programme called FSA Voices in January 2016 supporting our employees to promote our core messages about food we can trust to diverse audiences.
- Implementing a more proactive and structured way of engaging with a broader range of stakeholders, particularly seen in the ‘Our Food Future’ open discussion about consumer concerns in the food system. Our communication strategy has been redeveloped to support this approach, taking a more active stance on how we bring diverse views into our policy making, using innovative techniques, including social media, to ensure effective consultation.
- Finally, within our policy development, there have been a number of actions taken to address and raise awareness of food allergies and intolerances to different community groups.
4.3 Our Diversity Working Group continues to provide our corporate governance and strategic direction for diversity activity. 5. Our people – facts and figures
5.1. FSA Workforce profile
As at 1 November 2016, there were 1077 permanent and temporary employees in the FSA. This is a decrease of 42 employees from 1 November 2015 (from 1119).
5.2. Grade profile
A breakdown of FSA grades as at 1 November 2016 along with the previous 5 years is shown below.
5.3. Age profile
Analysis of our overall age profile as at 1 November 2016 shows the following Looking at our trends over the past 6 years, we can clearly see that our overall representation of workforce aged 49 and below has consistently decreased and for employees aged 50 and above we have consistently increased.
If we look at our employee age against grade as at 1 November 2016, this shows the following.
5.4. Gender
As at 1 November 2016 we had 729 male employees, representing 68% of our overall workforce and 328 female employees representing 32% of our overall workforce. This is represented in the below chart.
The next chart shows our split of gender by grade. Analysis of this data tells us that there are only marginal differences in gender representation from last year and our EO grade variation is due to the fact that 83% of our EO graded roles are within Field Operations. The role of Meat Hygiene Inspector, which is EO grade is male dominated by 91%. Appendix 1 shows a breakdown of gender, split out by grades over the past 5 years. Analysis of this data tells us that:
- There has been an increase in the number of males at AO grade from last year, by 6%, but overall there still remains a dominance of female representation.
- At EO grade, the gender split remains consistent over the past 5 years.
- At HEO/SEO grades there has been a marginal rise in male representation, to 52%, the highest it has been over the past 5 years. We will continue to monitor this.
- At G6/7 grades, there has been a 5% rise in male representation (55% to 60%), following the previous 4 years that showed a gradual decrease. Representation of females has dropped to its lowest level over the past 5 years, currently at 40%. This initial observation has been included on our list of areas to address in terms of our internal and external recruitment practices.
- At SCS grade, the same observation has been made that there is a 4% rise in male representation over the past year, although the trend over the past 5 years shows an overall increase of female representation from 30% to 43%, whereas males have decreased from 70% to 57%. We will continue to monitor this. 5.5. Disability
There were 881 employees (81.8%) who declared their disability status (either as having or not having, a disability). The remaining 196 employees (17%) either chose “Prefer not to say” or have left the field on their HR record blank.
There has been a slight increase in declared disability in grades AO and EO, a decline in HEO to G6 grade, and SCS remain the same over the past year. See Table 3 in the Appendix that shows the declaration rate by grade over the past 5 years. Last year our push for our employees to declare resulted in little change in declaration rates, so we will plan to run a fuller campaign over the 2017/18 year.
5.6. Ethnicity
As at 1 November 2016, of those who declared their ethnicity, the following has been recorded. The table below shows how the percentages of the minority ethnic group have consistently increased over the previous 5 years, but in 2016 have slightly dropped. The non-minority group showed a consistent decrease, but in 2016 slightly increased.
| | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | |------------------|-------|-------|-------|-------|-------|-------| | Minority ethnic | 8.30% | 8.45% | 9.20% | 10.50%| 11.80%| 11.23%| | group | | | | | | | | Non-minority | 91.70%| 91.55%| 90.80%| 89.50%| 88.20%| 88.77%| | ethnic group | | | | | | | | Total | 100% | 100% | 100% | 100% | 100% | 100% |
By grade, the graph below shows that we have minority ethnic representation at all grades, the highest representation of minority ethnic is within the AO grade. The ethnicity declaration rates over the past five years can be seen at Table 4 in the Appendix, and are represented in the chart below. Each grade band, apart from SCS grade shows a decrease in the actual declaration rates of minority ethnic. This decrease in minority ethnic representation has been included on our list of priority areas to address.
5.7 Sexual orientation
As at 1 November 2016, 50% of FSA employees had recorded their sexual orientation – an increase of 3 percentage points from 2016. Of those who had recorded their sexual orientation, 97.7% of employees identified themselves as heterosexual. 5.8 Religion and Belief
As at 1 November 2016, 44.1% of FSA employees had recorded their religion or belief. The past 6 years shows a steady increase in declaration.
Out of those 44.1%, 70% identified their religion as Christianity, 12.6% as Atheism, 5.05% Agnosticism, 2.95% as Islam, 0.62% as Sikhism and 0.42% as Judaism.
5.9 Working patterns
The FSA supports a number of flexible working patterns and many of our employees are able to work flexibly subject to business requirements, regardless of whether they have childcare or other caring responsibilities. As at 1 November 2016 the number of employees working part-time was 103 which represents 10% of the total FSA workforce. Over the past four years the following trends can be seen from the part-time employees. The above chart shows a 13% increase in male employees who work part-time as at 1 November 2016, greatly reducing the gender imbalance in part-time workers.
Out of those part-time employees, the following chart shows an increase in part-time workers who have a declared disability from 4% to 6%. In comparison with our overall statistics for disability, this figure is only marginally below the 6.92% of employees with a declared disability. The subsequent chart showing ethnicity declaration shows a 1% decrease in minority ethnic staff working part-time from the previous year. The next chart shows the majority of part-time employees are aged between 35 and 49, however we also note a decrease in part-time working from those who are aged under 49 and a substantial increase in those aged 50 and above. Our change programme, “Our Ways of Working”, continues to offer flexibility to employees in how and where they carry out their work. This may have had an impact on the number of employees who choose to work part-time, as this offers the opportunity to improve work-life balance without necessarily reducing working hours.
The introduction of shared parental leave may have had an impact on the number of employees who have taken this and subsequently wish to return to work on a part-time basis. This is an area that we will carry out further analysis.
5.10 Leavers / Exits
100 staff left the FSA between 1 November 2015 and 31 October 2016. The chart below shows the reasons for leaving. The category of ‘Other’ includes death in service, transfer to another government department, ill health retirement or end of temporary contract. In terms of leavers’ diversity categories, the table below gives a breakdown by gender, disability (of those who record their disability status), ethnicity and age over the past 4 years. We can see from this that there has been a much higher percentage of people leaving the FSA who had a declared disability and also those from minority ethnic group.
| | 2013 | 2014 | 2015 | 2016 | |----------------------|------|------|------|------| | Number of leavers | 86 | 142 | 239 | 100 | | **Gender** | | | | | | Male | 58.1%| 60.6%| 57.7%| 57.0%| | Female | 41.9%| 39.4%| 42.3%| 43.0%| | **Disability** | | | | | | Declared disability | 6.5% | 5.6% | 3.9% | 16.2%| | No declared disability| 93.5%| 94.4%| 96.1%| 83.8%| | **Ethnicity** | | | | | | Minority ethnic group| 5.1% | 8.6% | 8.1% | 12.9%| | Non-minority ethnic group| 94.9%| 91.4%| 91.9%| 87.1%| | **Age** | | | | | | Under 35 | 24.4%| 14.1%| 16.7%| 22.0%| | 35 – 49 | 33.7%| 35.2%| 41.8%| 32.0%| | 50 – 64 | 38.4%| 40.1%| 39.3%| 42.0%| | Over 65 | 3.5% | 10.6%| 2.1% | 4.0% |
5.11 Discipline and Grievances
From the recorded casework information between 1 October 2015 and 30 September 2016, 16 disciplinary cases were recorded. Because the numbers are so small, it is difficult to draw any conclusions regarding any imbalance against the overall workforce.
21 Grievances were recorded. These figures do not include informal grievances which are dealt with by management at a local level and are not recorded by the casework advisory service. The number of grievances spiked in March 2016, at the time End of Year Reviews were being carried although, the appeals relating to end of year reviews were not included as part of the above figure. 6. Recruitment
We continue to monitor all stages of the recruitment process, in particular to ensure that shortlists are gender balanced for both internal and external campaigns. All campaigns that are routed through the Civil Service wide e-recruiting system ensure that applicants are anonymous until the interview stage.
The information for the rest of this recruitment section is based on data gathered from the e-recruiting system, for the period from 1 November 2015 to 31 October 2016.
Applicant statistics can be viewed in full in tables 5-8 of the Appendix.
The success rate of female applicants getting through to the ready to hire stage is higher than the male success rate. There is a higher proportion of males being rejected at sifting and interview stage, but this is in proportion to the number of applications received. A slightly higher proportion of candidates with a disability are being rejected after the sifting stage than those who have no disability.
Compared to the number of initial applicants, a higher proportion of applicants from a minority ethnic group are being rejected after the sifting stage than those who are from a non-minority ethnic group. There is a higher proportion of applicants from a non-minority ethnic group who are successfully appointed, as compared to the minority ethnic group. We will investigate this further in our continuing review of recruitment processes. The youngest age group are the highest proportion of applicants, however in comparison with last year, there has been a decrease in the amount of applications received from this group (from 57% dropping to 42%), whereas applicants between 35 -49 have increased by 7 percentage points to 39% and age range of 50 – 64 has increased by 6 percentage points to 15%.
The proportion of younger applicants being rejected after screening has increased, which is the same finding as last year, whilst the older age groups have been more successful. The proportion of applicants aged between 35 – 49 rejected at interview is higher, although they are the highest overall proportion reaching ready to hire status (58%).
7. FSA Performance Management Scheme
An analysis of performance assessment scores for the 2015/16 review year was conducted by the FSA’s Analysis and Research Division using established statistical methods. The factors that were analysed included: age, gender, ethnicity, disability, working hours, grade and directorate. Within the FSA performance review scheme, employees received a score of either 1 (exceptional performer), 2 (effective performer) or 3 (improvement expected). Analysis found that there was only sufficient evidence to suggest that the highest performance scores were associated with Age and Working Hours, and the lowest performance scores were associated with disability. There was no statistical differences related to gender.
The proportion of staff awarded the top performance score appears to fall with age from the 30-39 age group. The proportion of over 60s receiving a score of 1 (11%) was significantly lower than the proportion of those in the 30-39 age group (31%).
The proportion of employees receiving the bottom performance scores increased with age. Among employees aged 40 and over, 12% received a score of 3, twice the proportion of those younger than 40 years of age (6%).
**Figure 1 – Performance scores awarded by the age of employees**
There were 67 employees who had stated that they were disabled. These employees were twice as likely to be awarded the bottom performance rating than the employees who stated they were not disabled (22% compared to 10%). 182 employees (out of 1078) chose not to disclose whether or not they were disabled. The distribution of performance scores among these 182 employees was similar to the employees who stated that they were not disabled.
**Figure 2 – Performance scores awarded by disability status of employees**
Field Operations was the directorate with the most part-time employees (39 of the 101 staff across the whole Agency). Within Field Operations, only 5% of part-time employees were awarded the top performance score, significantly lower than the proportion of full time employees (26%).
Within the rest of the Agency (excluding Field Operations) 16% of part-time employees were awarded the top performance score, compared to 26% of full-time employees. This was not a statistically significant difference.
**Figure 3 – Performance scores awarded by working hours of employees** A review of this data will be undertaken to identify whether any lessons can be learnt, and whether any further training or interventions are required. The Performance Management Scheme will also undergo a significant update in the near future, following a recent Civil Service wide review. This will include consideration of whether any changes can be made in light of the above.
8. Learning and Development
The FSA has again committed to sponsoring a number of places on the Civil Service-wide Positive Action Pathway programme, “Levelling the Playing Field”. The Position Action Pathway is a targeted learning intervention to support certain groups who are under-represented or have traditionally been treated unfairly.
The Pathway is a formal one year learning programme comprised of a number of mandatory learning activities, guidance to developmental workplace learning and completion of complementary “on the job” learning which includes:
- a formal one day Launch and Graduation Event;
- a Development Event designed to identify individual development needs;
- mandatory positive action learning modules; • membership of a facilitated structured Action Learning Set; • access to a Coach or to a Mentor for the duration of the programme; and • undertaking complementary “on the job” learning, such as project work or wider work deployment.
A wide range of diversity-related opportunities are available on Civil Service Learning (CSL), including modules on ‘Unconscious Bias’ and LGBT awareness. A new training provider has now been appointed for the Civil Service, and the expectation is that there will be an increase in the range of related learning opportunities on offer.
In addition, we continue to support a number of Civil Service wide initiatives, including the Crossing Thresholds programme and the Women’s Leadership Programme.
9. Equal Pay Audits
FSA pay practice and structure is underpinned by a job evaluation scheme (JEGS) which is used to support fair and consistent decisions about the weighting of job roles and provide the basis of a fair and orderly grading structure. The JEGs scheme is used in respect of posts from the Administrative Officer grade through to Grade 6 – and most evaluations are undertaken when a new post is created or an existing post changes significantly. A separate analytical scheme, Job Evaluation for Senior Posts (JESP) is used for jobs within the Senior Civil Service grades.
The FSA undertakes equal pay reviews as part of the preparations for each pay review round, both to monitor current pay practice and to ensure that pay proposals do not have a discriminatory impact.
10. Consumer Engagement
10.1. Consumer segmentation
Building on the consumer segmentation we carried out with consumers in 2016, we have now completed the Agency’s Northern Ireland consumer segmentation which includes health and nutrition information on all segments. We use the consumer segmentation to help us understand and gain a better picture of different groups of consumers when developing Communications activities and developing policies. We have used the Agency’s consumer segmentation (completed last year) to help us target our communication and policy development to the right audiences, particularly for our Food Safety Week activity and our campaigns around communicating the risk of consuming a rare burger.
We are currently working with Asian and African communities to develop our understanding of the illegal production of ‘Smokies’. This is due to report in 2017.
10.2. FSA Voices In January 2016 we launched a staff advocacy programme under the banner of FSA Voices. FSA Voices has been a great vehicle for promoting our core messages about food we can trust, particularly among harder to reach and diverse audiences. Everything we’ve done from Our Food Futures Conference to Food Safety Week to our high-profile Burger V Steak campaign, our advocates have helped us cut through the noise, with an authentic voice on food issues.
We currently have just over 300 people (about a quarter of the organisation) registered as FSA Voices. In true advocacy spirit, our FSA Voices have also given up their free time to pass on our knowledge and expertise. This includes equipping community groups and schools with relevant tools, to the FSA Voices community supporting each other by sharing stories, asking for advice and generating new ideas through a dedicated group on Yammer.
Food is probably the most essential and valuable resource we have. Without our advocates, we wouldn’t have reached as many of our key audiences, we wouldn’t have engaged as many citizens and we wouldn’t have been as successful in achieving the strategic objectives of our organisation. 11. Stakeholder Engagement
Working with partners and stakeholders across the communities that we serve is a integral part of our values, and we have been working on a more proactive and structured way of engaging with a broader range of stakeholders. In 2016 we conducted ‘Our Food Future’ – an initiative which sought to engage stakeholders from a full range of backgrounds in an open discussion about consumer concerns around medium term issues in the food system. We had over 150 attendees online and over 6000 people engaged in the live stream of the event. We also redeveloped our communication strategy to support this approach, taking a more active stance on how we bring diverse views into our policymaking, using innovative techniques, including social media, to ensure that our consultation is more effective particularly as we look to how food will be regulated in the future.
12. Policy Development
Within the allergy branch the “our food allergy story” campaign video featured a diverse range of people that make up our communities affected by food allergies and intolerances.
In the food service sector we have engaged with ethnic caterers, online food aggregators and trade associations to communicate changes in the law. Those with an ethnic background may not be as aware of food allergy due to the lower incidence in those countries. Therefore they may not be aware of the severity of the condition and the importance of knowing what ingredients have been used to prevent allergen cross contamination. In developing foreign language material, the “Think Allergy!” poster was translated into five languages (Chinese, Bengali, Urdu, Punjabi and Welsh) by the FSA for use by businesses and enforcement officers to help educate businesses in their catchment area. The LA’s then developed this further to support ethnic businesses specific to their area, by translating materials into other languages.
Looking forward to the future, with the introduction of the revised EU Novel Food Regulation we are exploring taking a different approach to how we handle traditional foods originating from outside the EU. We are aware that as a policy team what we may determine to be novel foods have in fact been and are being consumed safely in communities outside the EU but currently would have to go through a long authorisation process to be sold in EU. We are working within the new framework to make it easier for this type of product to enter the market through a quicker authorisation route that respects the traditional use of the food.
13. Accessibility The FSA aims to make its website food.gov.uk as accessible as possible. Information provided from the FSA is for everyone, regardless of ability, age or background and the FSA is committed to ensuring its website is accessible to the widest possible range of people. The FSA’s accessibility statement (see: http://www.food.gov.uk/about-us/data-and-policies/aboutsite/accessibility/accessibilitystatement/) sets out the broad principles and accessibility guidelines which the FSA follows. More detailed information about the accessibility features of the FSA’s website can be found at: http://www.food.gov.uk/about-us/data-and-policies/aboutsite/accessibility/.
We aim to ensure our websites can be used and work well with assistive technologies, such as software that reads pages aloud. We provide access keys for users who have difficulty in using pointing devices such as a mouse or who prefer to use keyboard shortcuts. We ensure our webpages use clear and simple language, are consistent and functional in all major browsers. We provide meaningful text equivalents for pictures, where pictures contain information, and our video content includes captions.
The accessibility of the website is tested and monitored on a continuous basis. We use a product called SiteImprove to highlight any issues and we intend to involve users with a variety of disabilities in website testing.
14. The FSA’s Welsh Language Policy The FSA’s statutory Welsh Language Policy, which is currently outlined in the FSA’s Welsh Language Scheme, describes which services are provided in Welsh and how and when these services will be provided, in line with the Welsh Language Act 1993. The Welsh Language Measure 2011 further promotes and facilitates the use of the Welsh language, and will require those bodies subject to this measure to provide its services accordingly and comply with **Welsh Language Standards**. As part of this process, the FSA was investigated by the regulatory body (to gauge current Welsh Language Provision), the Welsh Language Commissioner and a report containing the findings of this investigation was published in November 2015. This report will be considered by Welsh Government as they draft the relevant legislation, which will be issued to the FSA as a uniquely tailored ‘Compliance Notice’ outlining the Standards to which the FSA will be legally bound. A draft compliance notice should be published sometime during 2017. Until these Standards are enforced, the Agency’s Welsh Language Scheme will remain in place and the FSA will continue to provide Welsh language services of an equal and high quality.
Under the Welsh Language Scheme, the FSA is required to submit an annual report to the Welsh Language Commissioner setting out its compliance with its Welsh Language Scheme. This report details the FSA’s bilingual provision in accordance with the FSA’s Scheme. The Welsh Language Commissioner has noted the ongoing work of the Agency in implementing its Scheme during 2015/16. Further information can be found at: [http://www.food.gov.uk/about-us/data-and-policies/welshlanguagepolicy](http://www.food.gov.uk/about-us/data-and-policies/welshlanguagepolicy)
**15. Our Ways of Working**
The Our Ways of Working (OWOW) programme was established in late 2015 to create an environment in which our people are highly capable, effectively supported and engaged with our mission – food we can trust – so that they consistently choose to make outstanding contributions to protecting, informing and empowering consumers.
We ran a pilot entitled “give it a go” from Dec 2015-March 2016, where managers supported their teams to try out smarter ways of working. We also used this to develop more productive ways of working in terms of the tools, skills and physical spaces we use. 100% of our office based teams took part in the give it a go pilot and all managers tried at least one form, but most tried a number, of smarter working initiatives in 2016.
In real terms we have seen a sustained 20% increase in remote working across all our office based staff following the end of the pilot phase.
All our office based recruitment, internally or externally, now have a flexibility first approach and we have recruited a number of remote and flexible working staff in 2016.
The programme has increased smarter, location agnostic working across the organisations with tools and management support we need to do our jobs effectively.
In 2017 we are planning to launch three new contract types (office/site based, multi-location and home enabled) which have been developed to support our staff and allow a formal agreement for the individual to work in a location which suits them and the FSA. Initial indication suggests the following take up of each contract type:
- Office / site based: 40%
- Multi-location: 40%
- Home-enabled: 20%
Once all staff are working to the new contracts we intend to put in place monitoring systems to look at how the different arrangements are working and impacting on engagement and performance.
16. **Civil Service People Survey**
The Civil Service People Survey (CSPS) is an annual survey to measure staff engagement across the Civil Service. Detailed analysis of different demographic groups’ responses is being undertaken to inform the organisational response to the survey, in addition to continued activity to embed actions driven by the 2015/16 survey results. Each directorate will also analyse their own results, and collaboratively design local actions plans addressing what matters to people in that team.
17. Bullying and Harassment
Reported overall levels of experiencing bullying and harassment at work averaged 18% across the FSA. Field Operations levels rose 3 points to 28% between October 2015 and 2016. Office based levels range between 10 and 15%.
One hypothesis is that levels of under-reporting fell as staff recognised a heightened focus on dealing with issues at source, with significant incidents occurring between Food Business Operators and FSA staff/contract partner vets. The brief withdrawal of the regulatory presence to the vet’s office whilst an incident was escalated and resolved locally has occasionally been deployed, and welcomed for its impact.
Other key lines being taken include
- the overhaul in the calibre of leadership and management of change, in field operations in particular, characterised by the drive to ensure effective at least monthly one to one dialogue for all.
- Faster escalation of reported incidents during the year to FSA senior management with a view to nipping issues firmly in the bud.
- Re-specifying during the recent re-tender exercise the standards expected of our service delivery partners in equipping their leadership to address issues as they arise.
- the development a bespoke good practice workshop for delivery in Spring 2017 to both field and non-field based members of the management community and onward cascade to their teams. The content design has benefitted from reviewing best Civil Service practice, which sets out approaches to developing
- a common recognition of what constitute bullying, harassment and discrimination, and how these can be manifested in our world,
- specifying and role modelling inclusive behaviours, o defining the boundaries between sound (if robust) and poor management, and o setting out effective ways, both informal and informal, to address issues should they arise.
18. Conclusion
The 2016 year has seen us implementing a number of diversity and inclusion initiatives that have supported our staff internally and continue to do so. Our statistical analysis and measure of employee and applicant information has highlighted a number of areas that we will further investigate.
An integral part of our diversity values is how we serve each part of the community in a way that reflects it needs. This report has demonstrated how we have considered and implemented new and innovative ways of engaging with stakeholders and consumers in order to reach out to diverse communities that we serve and to influence our policymaking. Appendix
Table 1 – Gender split over past 5 years
| | 2012 | 2013 | 2014 | 2015 | Number | % | |-------|--------|--------|--------|--------|--------|-------| | Male | 68.70% | 67.60% | 66.90% | 67.47% | 729 | 67.69%| | Female| 31.30% | 32.40% | 33.10% | 32.52% | 348 | 32.31%| | Total | 100% | 100% | 100% | 100% | 1077 | 100% |
Table 2 – Gender by Grade over the past 5 years
| | Male | Female | Total | % Male | % Female | |-------|------|--------|-------|--------|----------| | AO | | | | | | | 2012 | 10 | 32 | 42 | 24% | 76% | | 2013 | 12 | 31 | 43 | 28% | 72% | | 2014 | 13 | 29 | 42 | 31% | 69% | | 2015 | 7 | 19 | 26 | 27% | 73% | | 2016 | 8 | 16 | 24 | 33% | 67% | | EO | | | | | | | 2012 | 602 | 113 | 715 | 84% | 16% | | 2013 | 571 | 121 | 692 | 83% | 18% | | 2014 | 539 | 109 | 648 | 83% | 17% | | 2015 | 459 | 88 | 547 | 84% | 16% | | 2016 | 428 | 85 | 513 | 83% | 17% | | HEO / SEO | | | | | | | 2012 | 210 | 210 | 420 | 50% | 50% | | 2013 | 213 | 207 | 420 | 51% | 49% | | 2014 | 187 | 204 | 391 | 48% | 52% | | 2015 | 205 | 187 | 392 | 50% | 49% | | 2016 | 204 | 188 | 392 | 52% | 48% | | G6/7 | | | | | | | 2012 | 73 | 53 | 126 | 58% | 42% | | 2013 | 71 | 57 | 128 | 56% | 45% | | 2014 | 78 | 61 | 139 | 56% | 44% | | 2015 | 75 | 62 | 137 | 55% | 45% | | 2016 | 81 | 53 | 134 | 60% | 40% |
### Table 3 – Disability declaration over the past 5 years
| | Declared disability | No disability declared | Not declared | Total | % Declared disability | % No disability declared | |--------|---------------------|------------------------|--------------|-------|-----------------------|-------------------------| | **AO** | | | | | | | | 2012 | 2 | 33 | 7 | 42 | 5.70% | 94.30% | | 2013 | 1 | 33 | 9 | 43 | 2.90% | 97.06% | | 2014 | 3 | 31 | 8 | 42 | 8.80% | 91.18% | | 2015 | 2 | 21 | 3 | 26 | 8.70% | 91.30% | | 2016 | 2 | 19 | 3 | 24 | 9.52% | 90.48% | | **EO** | | | | | | | | 2012 | 35 | 659 | 21 | 715 | 5.04% | 94.96% | | 2013 | 38 | 619 | 35 | 692 | 5.78% | 94.22% | | 2014 | 38 | 574 | 36 | 648 | 6.21% | 93.79% | | 2015 | 37 | 463 | 47 | 547 | 7.40% | 92.60% | | 2016 | 36 | 421 | 56 | 513 | 7.88% | 92.12% | | **HEO / SEO** | | | | | | | | 2012 | 21 | 345 | 54 | 420 | 5.74% | 94.26% | | 2013 | 21 | 338 | 61 | 420 | 5.85% | 94.15% | | 2014 | 17 | 306 | 68 | 391 | 5.26% | 94.74% | | 2015 | 17 | 275 | 100 | 392 | 5.82% | 94.18% | | 2016 | 15 | 281 | 96 | 392 | 5.07% | 94.93% | | **G6/7** | | | | | | | | 2012 | 4 | 108 | 14 | 126 | 3.57% | 96.43% | | 2013 | 6 | 102 | 20 | 128 | 5.56% | 94.44% | | 2014 | 9 | 98 | 32 | 139 | 8.41% | 91.59% | | 2015 | 9 | 93 | 35 | 137 | 8.82% | 91.18% | | 2016 | 8 | 89 | 37 | 134 | 8.25% | 91.75% | | **SCS** | | | | | | | | 2012 | 0 | 19 | 1 | 20 | 0% | 100% | | 2013 | 0 | 20 | 1 | 21 | 0% | 100% | | 2014 | 0 | 17 | 3 | 20 | 0% | 100% | | 2015 | 0 | 13 | 4 | 17 | 0% | 100% | | 2016 | 0 | 10 | 4 | 14 | 0% | 100% | Table 4 – Ethnicity declarations over the past 5 years
| | Minority ethnic group | Non-minority ethnic group | Not declared | Total | % Minority ethnic group | % Non-minority ethnic group | |--------|-----------------------|---------------------------|--------------|-------|------------------------|---------------------------| | **AO** | | | | | | | | 2012 | 9 | 27 | 6 | 42 | 25.0% | 75.0% | | 2013 | 11 | 27 | 5 | 43 | 29.0% | 71.0% | | 2014 | 13 | 24 | 5 | 42 | 35.1% | 64.9% | | 2015 | 14 | 11 | 1 | 26 | 56.0% | 44.0% | | 2016 | 9 | 12 | 3 | 24 | 42.9% | 57.1% | | **EO** | | | | | | | | 2012 | 42 | 644 | 29 | 715 | 6.1% | 93.9% | | 2013 | 41 | 617 | 34 | 692 | 6.2% | 93.8% | | 2014 | 41 | 573 | 34 | 648 | 6.7% | 93.3% | | 2015 | 39 | 478 | 30 | 547 | 7.5% | 92.5% | | 2016 | 37 | 448 | 28 | 513 | 7.6% | 92.4% | | **HEO / SEO** | | | | | | | | 2012 | 50 | 314 | 56 | 420 | 13.7% | 86.3% | | 2013 | 53 | 308 | 59 | 420 | 14.7% | 85.3% | | 2014 | 56 | 285 | 50 | 391 | 16.4% | 83.6% | | 2015 | 60 | 294 | 38 | 392 | 17.0% | 83.1% | | 2016 | 57 | 301 | 34 | 392 | 15.9% | 84.8% | | **G6/7** | | | | | | | | 2012 | 2 | 115 | 9 | 126 | 1.7% | 98.3% | | 2013 | 5 | 111 | 12 | 128 | 4.3% | 95.7% | | 2014 | 8 | 109 | 22 | 139 | 6.8% | 93.2% | | 2015 | 11 | 104 | 17 | 132 | 9.6% | 90.4% | | 2016 | 7 | 104 | 23 | 134 | 6.3% | 93.7% | | **SCS** | | | | | | | | 2012 | 0 | 16 | 4 | 20 | 0% | 100% | | 2013 | 0 | 17 | 4 | 21 | 0% | 100% | | 2014 | 0 | 15 | 5 | 20 | 0% | 100% | | 2015 | 0 | 14 | 3 | 17 | 0% | 100% | | 2016 | 1 | 12 | 1 | 14 | 7.7% | 92.3% |
### Table 5 to 8 - Applicant statistics between 01 November 2015 to 31 October 2016
#### Table 5
| Gender | Male | Female | Not said | Total | |-------------------------|------|--------|----------|-------| | Applications received | 877 | 542 | 16 | 1435 | | | 61% | 38% | 1% | | | Rejected after screening / sift | 601 | 392 | 8 | 1001 | | | 60% | 39% | 1% | | | Rejected after 1st interview | 92 | 47 | 4 | 143 | | | 64% | 33% | 3% | | | Reserve list | 9 | 8 | 1 | 18 | | | 26% | 23% | 1% | | | Ready to hire | 46 | 33 | 1 | 80 | | | 58% | 41% | 1% | |
#### Table 6
| Disability | No Disability declared | Disability declared | Prefer not to say | Total | |-----------------------------|------------------------|---------------------|-------------------|-------| | Applications received | 1297 | 85 | 53 | 1435 | | | 90% | 6% | 4% | | | Rejected after screening / sift | 910 | 59 | 32 | 1001 | | | 91% | 6% | 3% | | | Rejected after 1st interview | 130 | 5 | 8 | 143 | | | 91% | 3% | 6% | | | Reserve list | 16 | 1 | 1 | 18 | | | 89% | 6% | 6% | | | Ready to hire | 93 | 4 | 4 | 101 | | | 92% | 4% | 4% | |
#### Table 7
| Ethnicity | Non-minority ethnic group | Minority ethnic group | Not declared | Total | |----------------------------|---------------------------|-----------------------|--------------|-------| | Applications received | 1053 | 322 | 60 | 1435 | | | 73% | 22% | 4% | | | Rejected after screening / sift | 697 | 264 | 40 | 1001 | | | 70% | 26% | 4% | | | Rejected after 1st interview | 120 | 18 | 5 | 143 | | | 84% | 13% | 3% | | | Reserve list | 15 | 2 | 1 | 18 | | | 83% | 11% | 6% | | | Ready to hire | 67 | 7 | 6 | 80 | | | 83% | 9% | 8% | | Table 8
| Age | Under 35 | 35-49 | 50-64 | Over 65 | Not declared | Total | |----------------------|----------|-------|-------|---------|--------------|-------| | Applications received| 607 | 566 | 216 | 0 | 46 | 1435 | | | 42% | 39% | 15% | 0 | 3% | | | Rejected after screening / sift | 474 | 362 | 131 | 0 | 34 | 1001 | | | 47% | 36% | 13% | 0 | 3% | | | Rejected after 1st interview | 37 | 69 | 31 | 0 | 6 | 143 | | | 26% | 48% | 22% | 0 | 4% | | | Reserve list | 8 | 7 | 3 | 0 | 0 | 18 | | | 44% | 39% | 17% | 0 | 0 | | | Ready to hire | 20 | 45 | 13 | 0 | 0 | 78 | | | 25% | 58% | 17% | 0 | 0 | |
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e974bcec9095db971c11a425f952e5a958032941 | Foreign and Commonwealth Office (FCO) Diversity and Equality Report 2017-18
in response to the Equality Act 2010 Contents
Foreword ................................................................. 3
Introduction .......................................................... 4
Section 1—The FCO’s employees .............................. 5
Recorded data .......................................................... 5
Profile of the workforce ............................................. 6
Gender profile of the workforce .................................. 6
Ethnic profile of the workforce .................................... 6
Disability profile of the workforce ............................... 6
Religion and belief profile of the workforce .................... 7
Sexual orientation profile of the workforce ..................... 7
Age profile of the workforce ....................................... 7
Maternity and adoption leave profile ............................ 8
Staff Retention ......................................................... 8
Recruitment ............................................................ 9
Equality of Pay ........................................................ 11
FCO Diversity Policy and Engagement ......................... 12
Disability Policy and Support in the FCO ....................... 13
FCO Staff Associations ............................................. 14
Section 2—Regard for Equality within the FCO’s Activities 16
Foreign Policy ........................................................ 16
Women’s Rights ....................................................... 16
Lesbian, Gay, Bisexual and Transgender (LGBT) Rights .... 17
Rights of Persons with Disabilities ............................... 18
Freedom of Religion or Belief ...................................... 18
Racism ..................................................................... 19
Consular service ....................................................... 19
Support for Lesbian, Gay, Bisexual and Transgender Travellers ......................................................... 20
Forced Marriage Unit .................................................. 20
Digital transformation of consular services making them more accessible ............................................. 21
Consular Services in the EU and EFTA States ............... 21 Foreword
The FCO is committed to equality and continues to increase the diversity of our workforce in the UK and of our representation overseas. Despite the significant progress that we have made, there remains work to do. To help us achieve our ambitious targets we have a Diversity & Inclusion 2020 Strategy with three key priorities: providing further support for talent from under-represented groups; promoting inclusive leadership and management and tackling bullying, harassment and discrimination (BHD).
> In 2017 the FCO had 59 female Heads of Mission, Post and Governors. We now have 65 (30%), including two job sharing. This year, we appointed Britain’s first black female Head of Mission who is a career diplomat, NneNne Iwuji-Eme, and the first woman to be UK Permanent Representative to the United Nations Security Council, Karen Pierce.
> In February 2018, we held the first FCO Diversity Festival, inspired by the centenary of partial women’s suffrage in the UK and the updated Civil Service Diversity Strategy.
> We developed new guidance for Transgender staff and their managers and have introduced diversity objectives for all SMS staff.
> In spring 2018, our University Roadshow and pilot Schools Roadshow engaged with around 1,900 students across the UK to talk about a diplomatic career, the majority from diverse and Widening Participation backgrounds (under-represented groups).
> For its commitment to staff wellbeing, the FCO received a Silver award from Mind. Highlights over the past year include developing a Wellbeing Strategy, first-hand articles from senior leaders, and expanding the network of mental health first aiders.
> The Business and Community Diversity Benchmark awarded the FCO Gold for Race and Silver for Gender. We also increased our ranking in the Stonewall Equality Index and, for the first time this year, entered the new Social Mobility Employer Index. Introduction
This report is part of the FCO’s response to the Equality Act. It is intended to offer data on the equality impact of the FCO’s employment practices and activities.
The Equality Act 2010 creates a public sector equality duty to:
> Consider how different people will be affected by our activities. Deliver services which, while efficient and effective, are accessible to all and meet diverse needs. Fulfil our requirement to eliminate unlawful discrimination, advance equality of opportunity and foster good relations between people (both employees and others) who share a protected characteristic and those who do not.
Protected characteristics covered by the equality duty are:
> age disability gender reassignment marriage and civil partnership pregnancy and maternity race (embracing ethnic or national origins, colour and nationality) religion or belief sex sexual orientation
Note: The FCO has not incurred the expense of collecting data specifically for the purpose of this publication other than staff resource. These are online publications and therefore no additional printing costs have been incurred.
The majority of data presented represents a snapshot of the FCO as at 31 March 2018. Where data represents a different time period it is highlighted. Section 1—The FCO’s employees
The FCO has two different categories of employees. The UK Diplomatic Service and other Home Civil Servants working for the FCO are known collectively as UK-Based staff. These staff undertake a range of jobs during their careers both in the UK and at diplomatic posts abroad. The second category of FCO employees are hired to perform specific functions at individual posts abroad and are known as Local Staff. It is unusual for these employees to transfer between diplomatic missions or to work in the UK. The majority of FCO employees are Local Staff.
The diversity data in this report does not include FCO Services or Wilton Park, Executive Agencies of the FCO.
Both UK-Based and Local Staff are graded into a hierarchy as follows:
| Generic UK Civil Service Grade | Foreign Office Grade | |-------------------------------|----------------------| | | UK-Based Staff | | Senior Civil Service (SCS) | D7 | | Grade 6 | D7(L) | | Grade 7 | D6 | | Senior Executive Officer | C5 | | Higher Executive Officer | C4 | | Executive Officer | B3 | | Administrative Officer | A2 | | Administrative Assistant | A1 | | Non-Professional function | N/A | | | S1-S3 |
The FCO collects and holds human resources data on a centralised Management Information (MI) system. The gender and age of all staff is automatically recorded on this database, as is maternity leave when taken. UK-Based staff are asked to add information about their ethnicity, disability status, flexible working patterns, sexual orientation, religion or belief and caring responsibilities. Supplying this data is voluntary. Although the FCO encourages staff to supply it, it is not mandatory and reporting rates vary by characteristic. To protect the privacy of staff who do not wish to record any of this personal information, it is possible for individuals to record on the database that they do not wish to declare.
Local Staff are able to record their ethnicity, disability status, flexible working patterns and caring responsibilities but we do not require them to do so. This is due to sensitivities linked to the recording of some characteristics in a number of countries. Recording rates amongst Local Staff are therefore far too low to enable us to report on the representation of different groups. As a result, data on gender is included in this report, but not data on other diversity characteristics. However, the diversity of our Local Staff, who come from countries and communities around the world, is something we celebrate.
The recording rates amongst UK-Based staff, including those who have stated that they do not wish to declare are as follows:
| FCO UK staff diversity reporting rate | |--------------------------------------| | Mar 2017 | Mar 2016 | Mar 2018 | | Ethnicity | 82.4% | 85.1% | 86.3% | | Disability | 75.9% | 76.7% | 77.4% | | Sexual orientation | 77.4% | 72.5% | 76.6% | | Religion and belief | 71.3% | 76.0% | 76.6% |
Recorded data
The FCO collects and holds human resources data on a centralised Management Information (MI) system. The gender and age of all staff is automatically recorded on this database, as is maternity leave when taken. UK-Based staff are asked to add information about their ethnicity, disability status, flexible working patterns, sexual orientation, religion or belief and caring responsibilities. Supplying this data is voluntary. Although the FCO encourages staff to supply it, it is not mandatory and reporting rates vary by characteristic. To protect the privacy of staff who do not wish to record any of this personal information, it is possible for individuals to record on the database that they do not wish to declare.
Local Staff are able to record their ethnicity, disability status, flexible working patterns and caring responsibilities but we do not require them to do so. This is due to sensitivities linked to the recording of some characteristics in a number of countries. Recording rates amongst Local Staff are therefore far too low to enable us to report on the representation of different groups. As a result, data on gender is included in this report, but not data on other diversity characteristics. However, the diversity of our Local Staff, who come from countries and communities around the world, is something we celebrate.
The recording rates amongst UK-Based staff, including those who have stated that they do not wish to declare are as follows:
| FCO UK staff diversity reporting rate | |--------------------------------------| | Mar 2017 | Mar 2016 | Mar 2018 | | Ethnicity | 82.4% | 85.1% | 86.3% | | Disability | 75.9% | 76.7% | 77.4% | | Sexual orientation | 77.4% | 72.5% | 76.6% | | Religion and belief | 71.3% | 76.0% | 76.6% | Profile of the workforce
Gender profile of the workforce
The FCO employs around 12,500 staff, a third of whom are UK-based and two thirds Local Staff.
Proportion of female UK-Based staff by grade
| Grade | Proportion | |-------|------------| | Overall | 45.1% | | SMS | 33.2% | | D7 | 43.2% | | D6 | 40.8% | | C5 | 39.8% | | C4 | 44.3% | | B3 | 55.0% | | A2 | 62.8% | | A1 | 48.2% |
Proportion of female Local staff by grade
| Grade | Proportion | |-------|------------| | Overall | 42% | | S3 | 31% | | S2 | 11% | | S1 | 7% | | SMS1(L) | 100% | | D7(L) | 55% | | D6(L) | 55% | | C5(L) | 58% | | C4(L) | 64% | | B3(L) | 67% | | A2(L) | 34% |
Ethnic profile of the workforce
Proportion of BAME UK-Based staff by grade
| Grade | Proportion | |-------|------------| | Overall | 13.7% | | SMS | 5.6% | | D7 | 6.7% | | D6 | 6.8% | | C5 | 8.7% | | C4 | 14.6% | | B3 | 24.0% | | A2 | 31.1% | | A1 | 22.6% |
Disability profile of the workforce
Proportion of disabled UK-Based staff by grade
| Grade | Proportion | |-------|------------| | Overall | 10.9% | | SMS | 8.1% | | D7 | 10.0% | | D6 | 10.3% | | C5 | 12.3% | | C4 | 9.1% | | B3 | 12.3% | | A2 | 17.7% | | A1 | 17.3% | Religion and belief profile of the workforce
Proportion of UK Based staff by Religion and Belief
Sexual orientation profile of the workforce
Proportion of LGBT UK-Based staff by grade
Age profile of the workforce
UK-Based staff profile by age
UK-Based staff profile by age and grade Maternity and adoption leave profile
Maternity and adoption leave profile by age
Maternity and adoption leave profile by ethnicity
Staff Retention
The figures below show the grade, gender, ethnicity, disability and age percentage breakdown of staff that left the organisation due to retirement, resignation, termination of employment, or through career breaks, permanent transfers to other government departments or due to death in service. 3.5% of FCO employees left between 01 April 2017 and 31 March 2018. Recruitment
The FCO seeks to recruit talented British nationals from all backgrounds and from across the UK. We want to ensure that we are the best Diplomatic Service we can be and that we represent as effectively as possible the country we serve. In 2017-18, our recruitment focus was on the Diplomatic Service Fast Stream and other business critical roles. We are following and implementing the Civil Service Recruitment Principles of fair and open competition. For the recruitment of Local Staff in our overseas Missions, we aim to appoint the best candidate subject to local restrictions and employment law and recruitment campaigns are open to all.
Progress in 2017–18
Fast Stream and other specialist recruitment
> In 2017-18, the FCO recruited 31 specialists across the grades and 52 Fast Stream policy entrants (via the Diplomatic Service scheme and the Diplomatic Service Economist scheme).
> 59% of Fast Stream entrants were female, 24% reported a Black, Asian and Minority Ethnic (BAME) background, and 12% reported a disability. Of the 2016 intake, 52% were female, 14% were BAME, and 7% disabled.
> The FCO also recruited 9 Executive Officers through the Direct Appointment Scheme. These individuals applied for the 2017 Fast Stream but narrowly missed the minimum entry standard. They were deemed suitable for Executive Officer roles and recruited on that basis. 67% of DAS candidates were female, 38% were BAME, and 25% reported a disability.
Band A (Administrative Officer)
> In 2017/18 the FCO exceptionally recruited 13 Band A staff to work in the Legalisation Office at the Corporate Services Centre in Milton Keynes and the Consular Global Response Centre in London.
> Of the new Band A recruits, 31% were women, 8% declared as BAME and 15% reported a disability.
Apprenticeships
> In 2017-18, the FCO recruited 21 apprentices via external recruitment and the Civil Service Fast Track and the Government Communication Service Apprenticeships Schemes.
> Of the new recruits, 57% were women, 19% declared as BAME and 5% reported a disability.
> The centrally run apprenticeships campaigns were advertised on the Civil Service Fast Track and the Government Communication Service apprenticeships websites. The FCO’s campaign was advertised through the Milton Keynes College website, the National Apprenticeship Service website, and the FCO website.
Interns Our work experience schemes encourage individuals to experience life at the heart of the UK Government and consider the FCO as a future employer. In addition to our Graduate Internship, we participate in schemes that are managed centrally by Civil Service Resourcing and other Government Departments, including those directed towards individuals from under-represented groups.
In 2017, our FCO Graduate Internship Scheme provided 44 placements of up to 9 months. Another 25 interns worked in the FCO for up to nine weeks through the centrally managed Summer Diversity Internship Programme (SDIP). This resulted in our interns being 52% female, 38% BAME and 10% reporting a disability. We also participated on the centrally administered Early Diversity Internship Programme (EDIP) for first year undergraduates, providing 5 placements for a one week period.
In early 2018 the FCO took part in another scheme managed by the Department for Education called the Foreground (Care Leavers) Internship Scheme, welcoming 3 interns on a 12 month placement.
We have continued to run the Fast Stream ‘Fast Pass’ that allows Graduate and Summer Diversity interns to bypass the first stage of the Fast Stream application process. As our intern cohorts are more diverse than our current Fast Stream intake, this helps maximise the potential diversity of the Fast Stream cohort.
Experience of working in the FCO as an Intern
“I began my graduate internship just two days after having finished my Masters’ dissertation, with no inclination of what was to come next. I was fortunate enough to be placed in the Policy Unit, surrounded by supportive colleagues who were determined to make my time there as fulfilling as possible. Far from my slightly old-fashioned understanding of an intern’s role, I was immediately given real responsibilities and relied upon as an important cog in the Policy Unit team. My main tasks involved assisting with the corporate reporting structures of the FCO. In addition, I was encouraged to write Policy pieces and pursue developmental opportunities at every turn. On top of my core duties, the FCO offers a near-constant drip-feed of interesting, additional work for those who are willing to look. I have volunteered in Private Office, spoken at secondary schools on outreach visits, attended an FCO-PwC pilot scheme and studied Italian.
I have been privileged to work in an environment with so many talented colleagues who are always happy to share their knowledge, particularly if you offer to buy them coffee. I would strongly encourage anyone with an interest in the UK’s role within an increasingly complex international context to apply for this position.”
- Cal Westaway, Durham University: Defence, Development and Diplomacy
Outreach
The FCO’s Outreach Programme seeks to enhance the diversity of our recruitment. This year our University Roadshow engaged with Universities across the UK with high proportions of students from BAME (Black, Asian, and Minority Ethnic) and Widening Participation backgrounds. Over 40 members of staff from across the organisation got involved to tell their FCO story.
We increased our engagement with BAME students outside of London by 9.2% compared to our 2015-16 Roadshow.
We held an event for around 200 students from BAME and Widening Participation backgrounds studying at London Universities. The event was opened by the PUS and hosted jointly by the Director for Diplomacy 2020 and the FCO’s BAME Network.
The FCO also piloted a Schools Roadshow across the UK, engaging with more than 600 school-age students. Over half of the schools we visited had greater than 20% eligibility for Free School Meals.
Experience of the FCO’s Outreach Programme
“I attended the University Roadshow Tour in 2016 as I was finishing my undergraduate degree. Learning about the FCO from people with similar backgrounds and experiences to my own convinced me it was worth applying for, whereas previously I had discounted myself from being in with a chance. Now in my second year in the FCO, after getting a place on the Diplomatic Fast Stream, I have seen the continued importance senior management puts on diversity and equality: highlighting successes whilst recognising where there is still more to be done. Knowing how influential FCO outreach work was for my decision to apply for the FCO led me to join Foreground, the FCO staff association focused on socio-economic diversity. This year I went back to the University Roadshow Tour, but as a presenter where I shared my own experiences of working here.”
- Catherine Struthers, Diplomatic Fast Stream
Equality of Pay
FCO pay, for both UK and local staff, is determined by a range of factors including grade, performance, and length of time in employment. As part of the FCO’s commitment to putting equal pay in practice, regular monitoring of the impact of pay practices is carried out, including Annual Equal Pay Audits and reviews.
Gender
FCO employees are paid according to standard scales which apply equally to all staff. The table below illustrates that the comparison by delegated grade shows pay gaps between 0% and 1.26%. This is mainly explained by seniority of staff and/or length of service in the grade. Primarily as a result of the public sector pay cap, all those who have joined the FCO or become senior managers in the last eight years (which includes an increasing proportion of women) have remained at the bottom of the pay scale for their grade.
Note: The FCO has published a Gender Pay Gap Report for 2017 to 2018, in line with new Government legislation that made it statutory for organisations with 250 or more employees to report annually on their gender pay gap. The data in this Gender Pay Gap Report reflected a range of factors.
Mean and median ordinary gender pay gap by grade
| Grade | Women | Men | |-------|-------|-----| | A1 | 0.74% | | | A2 | 2.45% | 4.132% | | B3 | 1.26% | 2.68% | | C4 | 1.61% | 0.61% | | C5 | 3.11% | 1.81% | | D6 | 1.14% | 0.30% | | D7 | 1.13% | 0.67% | | SMS1 | 0.78% | | | SMS2 | 4.38% | 0.44% | | SMS3 | 1.26% | |
Ethnicity
The table below is using the data based on those who have reported their ethnicity. The comparison by delegated grade shows pay gaps of between 0% and 4.79%. The workforce comparison data shows that this is because of the smaller proportion of disclosed BAME staff at more senior grades. At the time the pay cap was introduced, the FCO was significantly less diverse than it is now. As a result of the public sector pay cap, all those who have joined the FCO or become senior managers in the last eight years (which includes an increasing proportion of BAME staff) have remained at the bottom of the pay scale for their grade. Small improvements have been due to a more diverse group of staff securing promotions, raising the average at that level.
| Grade | Average Minority Ethnic Pay | Average White Pay | % Average Pay gap | |-------|-----------------------------|-------------------|------------------| | A1 | £19,041 | £19,041 | 0% | | A2 | £21,378 | £21,090 | +1.37% | Staff Engagement Survey
As with staff in all Civil Service Departments, all FCO staff can take part in a Staff Engagement Survey (SES) in October each year. The 2017 SES had an 86% response rate, a 2% increase from the previous year. The FCO’s overall engagement score (based on five questions which show how positive, attached and motivated staff feel) was 70%, 9 points higher than the Civil Service average. The FCO’s inclusion score and fair treatment score was 79%, 3 points above the Civil Service average.
As part of the survey, staff are also asked if they have been subjected to bullying/harassment or discrimination (BHD) at work in the previous year. Reports of bullying and harassment remained at 13%, and the discrimination figure increased from 15% to 16%. Civil Services averages are 11% for bullying and harassment and 12% for discrimination.
The under-represented groups are more likely to report BHD than the majority groups, in particular staff with a disability or LGBT (for bullying or harassment).
The results shown below are broken down by age, gender, disability status, sexual orientation and ethnicity. However, some staff did not supply this demographic data, which means that the disaggregate data can appear in some cases to be incompatible with the overall results.
FCO Diversity Policy and Engagement
The FCO continues to increase the diversity of our workforce in the UK and of our representation overseas. This includes visible diversity but also the need to promote diversity of thought, skills and background.
We have targets for the diversity of our Senior Management Structure (SMS) to be achieved by October 2019. Performance against these targets can be seen below:
| Target | 2019 target (% SMS) | 31 March 2017 | 31 March 2018 | |--------|---------------------|---------------|---------------| | Female | 39% | 30% | 33.2% | | BME | 7% | 5.6% (based on 94.4% SMS recording rate) | 5.6% (based on 92.6% SMS recording rate) | | Disabled| 7% | 7.0% (based on 72.6% SMS recording rate) | 8.1% (based on 76.3% SMS recording rate) | In February 2017 the FCO Board agreed three Diversity and Inclusion priorities in a new Diversity and Inclusion 2020 Strategy. We are making progress against all:
> **A diverse talent pipeline.** Levelling the playing field by providing further support for talent from under-represented groups. We have used a map of our talent pipeline to target interventions, including through promoting talent schemes and guidelines for writing inclusive job-specifications. Our Outreach Programme has reached out to potential applicants from a wider talent pool by engaging with students from Widening Participation backgrounds.
> **Tackling Bullying, Harassment and Discrimination (BHD):** The 2017 Staff Survey results show that bullying and harassment remains at 13% and that discrimination has increased from 15% to 16%. We have undertaken targeted intervention at our 30 posts and departments with the highest BHD scores including a two day conference on tackling BHD for the Deputy Heads from these posts and departments. We also ran an internal communications campaign, ‘Taking Action Together’ to help raise awareness of BHD and help all staff to prevent and tackle it. We have introduced Learning & Development initiatives, including a new programme for First Response Officers to support regional collaboration and networking and a ‘Confident Manager’s Programme’ course to promote inclusive working practices through managers and help them to tackle BHD issues.
> **Creating an Inclusive Culture:** Driving real change in leadership and line manager capability and behaviour on diversity. Most SMS staff have undertaken face-to-face diversity training and we have introduced a diversity and inclusion objective for all SMS staff. Learning & Development schemes, including leadership offers from external organisations such as Stonewall, continue to support talented colleagues to become inclusive leaders and role models. We encourage all staff to raise participation in Diversity and Inclusion through our Outreach Programme.
### Disability Policy and Support in the FCO
In October 2016, the FCO were awarded Silver accreditation by the Business Disability Forum (BDF) following completion of their disability benchmark. This placed the FCO as one the best-ranked Ministerial departments on the BDF Roll of Honour. The FCO were awarded Disability Confident Employer status in November 2016 and Disability Confident Leader status in March 2017 under the Department for Work and Pensions (DWPs’) newly launched Disability Confident Scheme.
Disability support for UK based staff is provided by the Disability Policy & Support Team (DPST). When required, the DPST seek advice from the Civil Service Workplace Adjustment Service (CSWAS) and use the services of a variety of disability providers for the provision of expert disability assessments and advice.
Terms and conditions for Local Staff working at FCO Posts abroad are governed by local law but advice and support on disability policy issues is also available to Post.
Disabilities disclosed by UK-based staff cover a broad range of conditions, including neuro-diverse conditions (e.g. Dyslexia, Dyspraxia & Asperger’s), mobility issues and hearing or visual impairments. The provision of workplace adjustments for disabled staff can include an expert disability assessment; the supply of specialised office equipment and/or provision of IT software and hardware and appropriate training. More general awareness training and support is also available to disabled staff, their managers and (where appropriate) team colleagues. Staff who are profoundly deaf or with a significant hearing impairment can additionally request the support of qualified British Sign Language (BSL) interpreters & lip speakers.
The FCO supports the promotion of good mental health and hosted the very first Civil Service Mental Health Conference in June 2018. We also have an ongoing programme to train Mental Health First Aiders (MHFA). We aim to train 200 staff by the end of March 2019 and are on track to meet this target with approximately 160 staff trained so far. In addition to MHFA training, the FCO is also rolling out Wellbeing training to all SMS/SCS officers.
The FCO is also a member of the Business Disability Forum (BDF), a not-for-profit member organisation. that makes it easier and more rewarding to employ and do business with disabled people in the UK. Once again, in 2018, the FCO hosted the BDF roundtable meetings, designed to get disability support teams from across Whitehall departments together to hear about the latest developments on disability issues, network and share best practice.
FCO Staff Associations
The FCO’s Diversity and Inclusion Team and senior management work closely with staff networks and the Diplomatic Service Families Association (DFSA) to understand and address issues faced by staff. As part of this collaboration we support a group of SMS Champions who provide staff networks with coaching, strategic direction and senior leadership. At Board Level we have a Diversity and Inclusion Champion and a Champion for tackling BHD.
Our staff networks are:
**FCO Women**: It has around 950 members. It continues to hold a range of masterclasses (around 30 in the last year) and events. These events welcome internal and external speakers, helping to empower colleagues with the tools they need to get the most out of their career. FCO Women works closely with other Associations and Government Departments. Events this year which celebrated 100 years of partial women’s suffrage were held jointly with the Department for International Trade (DIT) and the Department for International Development (DIFD) and the Canadian High Commission and it continued its support for TEDX Whitehall Women (hosted by FCO last year). The suffrage flag has been taken to a number of locations, both by the PUS and the Special Envoy for Gender Equality. Over the last year, it has also matched 74 mentors with mentees. FCO Women contributes actively to policy making towards gender equality both internally (with HRD) and externally. This year, it worked towards a 10 point plan to help achieve the target of 39% women in the SMS by 2019 and to respond to the gender pay gap. It is also contributing to an appropriate internal response following #metoo. FCO Women supports the Gender Equality Unit which leads policy making on international gender parity. The Chair of FCO Women is the first FCO Special Envoy for Gender Equality.
**Religion and Belief Group**: Undertakes a programme of events to raise awareness of the way in which religion impacts the life of staff, and influences the way in which many people see the world. The network manages the FCO’s Multi-Faith Prayer Room and organised a high profile inter-faith panel as part of the 2018 FCO Diversity Festival, featuring former Bishop of London, Richard Chartres and Baroness Uddin. The Chair of the Group received the inaugural ComRes Faith Champion award for her work to support religious literacy in the FCO.
**FLAGG (FCO LGBT+ Staff Association)**: FCO Lesbian and Gay Group (FLAGG) was Highly Commended in the FCO Staff Awards for raising the profile of LGBT+ issues in the office. Their work includes developing “Pride Week”, rainbow lanyards, re-launching the LGBT+ Allies Network, and producing the first ever guidance for transgender staff and their managers. FLAGG continues to provide confidential support to LGBT+ officers across the FCO, and has helped to develop staff both through the Stonewall Leadership course and Allies training and events, including a talk by the Lord Mayor of Westminster on Diversity in Leadership. This is all with the aim of creating a more inclusive and diverse workplace where everyone feels able to bring their full selves to work, and can achieve their full potential.
**BAME Network:** Represents the views of ethnic minority staff at the FCO. They focus their work on (a) celebrating racial diversity in the FCO through their Role Model speaker events and blogs; (b) supporting BAME staff in the FCO with first response services, mentoring and learning sets; (c) engaging the Board, HR and other staff associations so FCO policies are sensitive to the needs of its diverse staff body. They have been heavily involved in this year’s Outreach Programme to ensure the FCO continues to represent the changing face of Britain in the years ahead. Their membership is open to all staff and they are passionate about raising awareness and generating dialogue around issues of race and ethnicity in the office.
**Enable (Disability Association):** Changes the profile of people with disabilities in the FCO by helping to raise diversity recording rates. It has given greater visibility on disability issues across the whole organisation. Activities include chairing the Civil Service Disability Network, hosting Civil Service wide events and actively participating in the launch of the Role Model Strategy, (facilitated by the BDF and CS Disability and Inclusion Team). Enable has a global community site with 350 members and regularly blogs internally and externally. By increasing awareness of disabilities, Enable has helped to change working culture, which has contributed to the FCO achieving the Department for Work and Pensions Disability Confident Leader accreditation.
**Diplomatic Service Families Association Carers’ Network (DSFA):** Raises awareness in the FCO of the issues faced by those with caring responsibilities, providing advice on how to manage a balance between work and care responsibilities, including when overseas e.g. caring for elderly parents at home. In 2016, the FCO introduced the Carer’s Charter setting out the FCO’s commitment as an employer to supporting carers in the workplace.
**Flexible Working Network:** Provides advice and support on a wide range of different working options to ensure that individuals, teams and the organisation as a whole can benefit from the FCO’s positive approach to flexible ways of working. The network’s committee has champions for different types of flexible working, each with their own personal experience. It works with HR to consider and develop global policy on flexible working.
**Forefront (Social Mobility Network):** The newest FCO Staff Association launched in September 2016 and is open to all FCO employees to champion diversity of background. Forefront’s workforce strategy has 4 working groups. These groups: reach out to those from low socio-economic status (SES); champion diversity of background within the FCO; support members who may have faced or be facing barriers to social mobility; and engage with policy to challenge existing barriers to those from low SES. They are a growing network and membership is open to all who are passionate about improving social mobility. They are represented on a cross government network to improve diversity of background across the civil service.
**Parents’ Support Network (PSN):** Brought the Mothers’ Support Network and Single Parents’ Network under one umbrella to: (a) support and provide practical advice to all FCO working parents (including fathers) in the UK and overseas; (b) share experiences of common issues impacting career progression and work/life balance; and (c) advocate change to HR on family-friendly policies including flexible and part-time working, Shared Parental Leave and childcare. The PSN has over 250 members. It has formed a new PSN Committee and on-line Community site for parents to share information and parenting strategy tips. In January it launched a new purpose-built Parent/Baby room to support fathers and mothers in work who are pregnant, breast-feeding or returning to work from maternity/paternity leave or shared parental leave.
**Wellbeing Network:** Offers support, guidance and advice on any issues which affect FCO staff wellbeing. The Network regularly run events to promote good mental health in the workplace and these link to wider campaigns such as Mental Health Awareness Week, National Work Life Balance Week and Time to Talk Day. The Network also acts as a point of contact and source of information, advising colleagues in the UK and overseas of the various paths available to them for professional support within and outside the organisation. The Network also manages and promotes the staff wellbeing rooms located in FCO buildings in the UK and overseas. Section 2—Regard for Equality within the FCO’s Activities
Foreign Policy
Women’s Rights
The FCO has committed to a foreign policy that consciously and consistently delivers for women and girls, with a particular focus on girls’ education. The FCO aims to secure 12 years of quality education for all girls by 2030, in support of the Sustainable Development Goals (SDGs), which will not only respect their human rights but also help make their societies more peaceful, prosperous and equitable. The joint campaign with DFID and Department for Education seeks to have an impact at the multilateral and bilateral levels. In February 2017, the FCO appointed the first FCO Special Envoy for Gender Equality, Joanna Roper. A dedicated Gender Equality Unit (GEU) was also created in October 2017.
The GEU leads on gender equality and women’s rights, working closely with the FCO Network, other government departments and international organisations / civil society, on issues such as: eliminating violence against women and girls, including harmful practices of Female Genital Mutilation (FGM), Child and Early Forced Marriage (CEFM); discriminatory laws and practices; and the promotion of gender equality through women’s political and economic empowerment.
The FCO supported debates in Parliament to mark International Women’s Day on 8th March. The FCO Special Envoy for Gender Equality was part of the UK delegation at the UN Commission on the Status of Women (CSW) in New York in March, which secured an outcome document containing strong language on improving labour markets, closing the gender pay gap, ending occupational segregation and addressing the burden of unpaid care work. We secured good language around the majority of UK priorities including modern slavery and participation of National Human Rights institutions. The FCO’s Week of Women in November 2017, in association with the Women of the Future Programme, was aimed at supporting, connecting and inspiring the next generation of female leaders. The FCO hosted a panel event for Women of the Future, Chevening scholars and FCO staff to discuss female political and economic empowerment and barriers to girls’ right to education.
During her visit to Canada in September, the Prime Minister agreed with the Canadian Prime Minister, Justin Trudeau, that they would champion gender equality globally. The Gender Equality and Women’s Empowerment Working Group, part of the UK-Canada Public Policy Forum, work on: gender and trade; addressing the gender pay gap; ending violence against women and girls; and Women, Peace and Security, including in Iraq, Syria and Ukraine.
In 2017, the UK Government developed the fourth UK National Action Plan (NAP) on Women, Peace and Security (WPS) for 2018-2022 which was launched in January 2018. This sets out how we will meet UN Security Council Resolution (UNSCR), 1325 commitments and deliver better protection and empowerment of women in conflict contexts overseas. Consultation with experts from academia and civil society informed the Government’s work on the NAP, as did consultations with civil society in Afghanistan, Burma, Somalia and Syria. The UK also funded an independent evaluation of the 2014-2017 NAP. The revised NAP takes account of feedback from the previous Action Plans, building around seven strategic outcomes and nine focus countries.
The UK continued to work to amplify women’s voices, to increase their participation in conflict resolution, and to support their educational, economic and political empowerment. A Wilton Park event in December on women in mediation brought together mediation experts, many of them women, to build and share knowledge. We promoted the participation of women in political processes and mediation roles in Syria, Somalia, Colombia and Yemen. UK support also provided services for women who suffered sexual and gender-based violence in Syria and strengthened the role of women in the security forces in Somalia. The FCO worked with the Ministry of Defence to launch the WPS Chiefs of Defence Network with Canada and Bangladesh at the Vancouver UN Peacekeeping Defence Ministerial in November. The Minister for Human Rights, Lord Ahmad of Wimbledon, led efforts to do more on gender and preventing / countering violent extremism.
In March 2017, the Preventing Sexual Violence in Conflict Initiative (PSVI) marked its fifth anniversary at an event attended by its co-founders, Lord Hague and Angelina Jolie. The second edition of the International Protocol on the Documentation and Investigation of Sexual Violence in Conflict was published in March. Lord Ahmad of Wimbledon was appointed the Prime Minister’s Special Representative on Preventing Sexual Violence in Conflict in June, succeeding Baroness Anelay. The PSVI Team of Experts conducted a number of tasks overseas, including to Bangladesh in response to the Rohingya crisis.
Despite the progress achieved at the UN level and elsewhere within 2017, significant challenges remain. These challenges include: the many different forms of violence against women; securing sexual health and reproductive rights and equal access to education; and achieving gender equality in the workplace and in political and public life. We will continue to address these through diplomatic efforts and targeted programme activity. Between 2016 and 2018 the FCO supported women’s rights projects in at least 28 countries with a total spend of over £3,500,000. These included projects focussed on encouraging political leadership, legislative reforms and regional cooperation in order to produce a safer environment for women.
Lesbian, Gay, Bisexual and Transgender (LGBT) Rights
The UK Government believes that human rights are universal and should apply equally to all people. We are opposed to all forms of discrimination and we work to uphold the rights and freedoms of LGBT people in all circumstances. We are committed to the principle of non-discrimination on any grounds, including on the basis of sexual orientation and/or gender identity. It is our belief that LGBT people are not asking for special rights, but rather to be accorded the same dignity, respect and rights as all other citizens.
The FCO’s work in combatting violence and discrimination against LGBT people forms an important part of our wider international human rights work. We are committed to the ‘Leave No One Behind’ promise made at the United Nations General assembly in September 2015. Every person should have a fair opportunity in life no matter who or where they are.
We work through our Embassies and High Commissions and through international organisations, including the UN, EU, OSCE, the Council of Europe and the Commonwealth, to promote tolerance and non-discrimination against LGBT people and to address discriminatory laws, in particular those that criminalise same-sex relations.
It is a reality that the authorities of many countries actively persecute LGBT people, with 75 countries continuing to criminalise consensual same-sex relations. Even in countries where consensual same sex relations are legal, many people still face violence and discrimination because of their sexual orientation or gender identity, often as a result of state-sanctioned discrimination, stigma and hate crime, a lack of adequate legal protection and poor enforcement of existing protections. We continue to urge all countries to decriminalise consensual same sex relations and put in place legislation that provides for protection from discrimination for LGBT people—including in the workplace and in the provision of goods and services.
Our Embassies and High Commissions monitor and raise human rights in their host countries. As well as diplomatic lobbying, we encourage UK missions overseas to seek out appropriate opportunities to promote human rights and prevent discrimination, including on the grounds of sexual orientation or gender identity. In March 2018 HMA Berlin invited Sir Stephen Wall, from Kaleidoscope Trust to both talk to staff in the Germany network about diversity and inclusion and to meet German activists and politicians on the LGBT international rights agenda. A lunch event also included Human Rights Watch, Amnesty International, a documentary film- maker, an MP from the Bundestag Human Rights Committee and German civil society. We fly the rainbow flag with pride on the appropriate occasion.
The International Day against Homophobia, Biphobia and Transphobia (IDAHOBIT) and Pride celebrations provide an opportunity for a large number of Posts to signal our strong solidarity with LGBT communities worldwide. On Saturday 17th June 2017, 15 UK based staff, including two Ambassadors, took part in the Vienna Pride parade as Diplomats for Equality; the UK had drafted the joint statement and actively secured its 30+ co-sponsors.
We introduced consular same sex marriage services in June 2014. In 2017 we performed 184 consular same sex marriages and 25 conversions of civil partnership to marriage in 27 countries. The UK, a founding member of the Equal Rights Coalition (ERC), founded in 2016, joined the ERC’s Executive Committee in 2017 to shape and support the ERC’s efforts to help secure global LGBT equality. The UK is an active member of the UN’s LGBT Core Group and we also support the work of the UN Free and Equal Campaign, stressing the importance of opportunities to discuss, debate and celebrate LGBT equality at the international level.
In 2016-2018 the FCO’s Magna Carta Fund for Human Rights and Democracy provided approximately £1.6million in funding to projects promoting and protecting the rights of LGBT people.
**Rights of Persons with Disabilities**
The UK works internationally to counter the discrimination, marginalisation and violence which can disproportionately impact people with disabilities and put them at risk of exploitation.
In 2017 we worked actively at the multilateral level by engaging on disability focused resolutions at the UN Human Rights Council and enabling the participation of activists from UK civil society at the Organization for Security and Co-operation in Europe (OSCE) Human Dimension Committee meeting where they took part in an event on engaging persons with disabilities in political and public life. We mark the UN International Day of Persons with Disabilities with events in London and at overseas Posts.
The issue of the rights of persons with disabilities has strong Ministerial support. The UK’s delegation to the 10th Conference of States Parties to the Convention on the Rights of Persons with Disabilities in June, 2017 was led at Ministerial level. This looked at inclusion and full participation of persons with disabilities and their representative organisations in the implementation of the Convention.
In our bilateral work we continued to call for states to sign and ratify the United Nations Convention on the Rights of Persons with Disabilities (UN CRPD), using mechanisms such as the Universal Periodic Review at the UN Human Rights Council.
**Freedom of Religion or Belief**
The UK has remained firmly committed to promoting and defending freedom of religion or belief (FoRB) for individuals around the world. Lord Ahmad of Wimbledon, Minister for Human Rights made FoRB a top priority within his human rights portfolio, galvanizing the work of our diplomatic network.
In October 2017, Lord Ahmad of Wimbledon launched regular faith roundtables to enhance dialogue with faith leaders and representatives and to draw on their experience to find solutions to international challenges. Topics included Burma, and also the role of women in tackling religiously motivated violent extremism.
We continued to promote FoRB in multilateral fora. For example, at the UN Human Rights Council in March 2018, the UK worked to help maintain consensus on the adoption and implementation of the EU sponsored Resolution on ‘Freedom of Religion or Belief’ and the Organisation for Islamic Cooperation sponsored Resolution on ‘Combating Religious Intolerance’. Lord Ahmad of Wimbledon also highlighted the importance of defending the right to FoRB when he addressed the Human Rights Council in September 2017.
As part of our work to promote FoRB, we continued to raise individual cases of concerns with countries. Examples include:
> During his visit to Bangladesh in August 2017, —Lord Ahmad of Wimbledon visited the Ahmadiyya Mosque in Dhaka and made a call for religious tolerance.
> During Pakistan’s Interior Minister (Ahsan Iqbal)’s visit to the UK in February 2018, Lord Ahmad of Wimbledon raised our concerns about FoRB and the protection of minority religious communities.
> During his visit to Iraq on 2nd-4th March 2018, Lord Ahmad met with representatives of the Yezidi and Christian communities to discuss the challenges they currently face.
In promoting respect through education, we supported a number of FoRB projects through our Magna Carta Fund for Human Rights and Democracy. One example included a project to support secondary school teachers in the Middle East and North Africa region to teach about FoRB.
We also re-launched our religion and diplomacy training offered to all staff in partnership with the London School of Economics Faith Centre. This was part of our commitment to help staff understand the key role that religion plays in shaping foreign policy. To supplement this training, we also ran a series of lunchtime seminars throughout the year, containing topics such as ‘Catholic Social Teaching’ by Dr Anna Rowlands.
Racism
Tackling all forms of racism including racial discrimination, xenophobia and related intolerance remained an important part of the UK government’s work on human rights. The UK has continued to work through multilateral organisations, including the United Nations (UN) to address these issues.
The UN International Convention on the Elimination of All Forms of Racial Discrimination continued to underpin international cooperation to prevent, combat and eradicate racism. Through the UN, we worked to encourage the international community to focus on strengthening national, regional and international legal frameworks, in order to make a reality of the protections contained in the Convention.
In our ongoing commitment to tackle antisemitism, we remained an active member of the International Holocaust Remembrance Alliance (IHRA) and we worked to encourage other states to consider adopting the working definition of antisemitism, agreed by IHRA in 2016, for their domestic use. We welcomed the decisions by a number of countries including Austria and Bulgaria to adopt the working definition.
Through our multilateral and bilateral work, the UK will continue to work with the international community to stand together against intolerance in all its forms and to tackle discrimination and promote equality of opportunity for all individuals.
Consular service
The FCO Consular Service offers assistance to British nationals in difficulty abroad.
In our customer charter, we commit to: “be professional, non-judgemental, polite and helpful to you whatever your gender, race, age, sexual orientation, marital status, disability, religion or belief.”
Our travel advice and information for travellers, available online, aims to help all British people travel safely. Our advice for lesbian, gay, bisexual and transgender (LGBT) travellers was reviewed in 2017 to help LGBT travellers research laws and local attitudes in their destination country and plan for a safe and enjoyable trip. We have tailored advice for disabled travellers, solo women travellers and travellers with mental health needs. We promote our advice through a number of events.
In financial year 2017/18, our Consular contact centres handled 350,000 telephone enquiries and consular staff provided support in more than 22,000 consular cases. In 2017 we introduced a change to the FCO switchboard to enable callers to speak to a consular officer more quickly. Consular staff are trained to provide high quality assistance tailored to the needs of the individual. This includes mandatory unconscious bias training as well as specific training to support customers with mental health needs.
The FCO collects data on the age and gender of those it provides services to (but not ethnicity or other protected characteristics). The table below shows the top five highest volume case types and number of Emergency Travel Documents issued in FY 2017/18, by demographic.
### Support for Lesbian, Gay, Bisexual and Transgender Travellers
We introduced consular same sex marriage services in June 2014 and provide the service in 25 countries. In 2017 we performed 184 consular same sex marriages and 25 conversions of civil partnership to marriage.
The British Government can consider approaching the local authorities if LGBT prisoners are not treated in line with internationally accepted human rights standards. This may include lobbying against discrimination on the grounds of gender or sexuality, requesting appropriate medical treatment and raising concerns about the safety of any prisoner.
### Forced Marriage Unit
The Forced Marriage Unit (FMU) is a joint Home Office and Foreign and Commonwealth Office Unit that provides assistance in cases of forced marriage in the UK and consular cases involving British people overseas, including dual nationals. Forced marriage has been a crime since June 2014. It is a serious abuse of human rights and a form of domestic abuse. Where children are involved, it is child abuse. Our staff are trained in the specific issues relating to victims who are LGBT or who have a disability and provide tailored assistance in these cases.
The FMU runs a targeted outreach programme, which raises awareness of forced marriage and related issues with statutory agencies including police, social services and health professionals alongside general broader work to raise awareness with potential victims. FMU
### Highest volume case types and number of Emergency Travel Document (ETDs) issued in FY 2017/18, by demographic
| Age | Arrest/Detention | Death | Hospitalisation | Victim of Crime | Welfare | ETDs | |-----|------------------|-------|-----------------|----------------|---------|------| | | Male | | | | | | | 0-15| 17 | 35 | 67 | 13 | 26 | 1,468| | 16-30| 1,469 | 145 | 369 | 144 | 589 | 6,185| | 31-50| 1,888 | 361 | 471 | 127 | 844 | 6,109| | 51-64| 682 | 772 | 505 | 62 | 512 | (51+) 4,447| | 65+ | 191 | 1,514 | 768 | 35 | 422 | - | | Unknown | 117 | 67 | 81 | 35 | 137 | - | | | Female | | | | | | | 0-15| 10 | 21 | 47 | 14 | 18 | 1,480| | 16-30| 286 | 55 | 246 | 328 | 403 | 3,950| | 31-50| 297 | 114 | 226 | 225 | 598 | 3,135| | 51-64| 96 | 203 | 203 | 79 | 234 | (51+) 3,248| | 65+ | 20 | 488 | 411 | 30 | 206 | - | | Unknown | 9 | 20 | 64 | 31 | 97 | - | | | Gender undisclosed | | | | | | | 0-15| 0 | 1 | 1 | 1 | 5 | - | | 16-30| 63 | 6 | 17 | 23 | 39 | - | | 31-50| 83 | 18 | 27 | 13 | 64 | - | | 51-64| 25 | 31 | 17 | 5 | 21 | - | | 65+ | 9 | 79 | 41 | 3 | 20 | - | | Unknown | 25 | 22 | 25 | 10 | 52 | - | statistics suggest that young people aged between 16 and 25 are most at risk of being forced into marriage.
In 2017, the FMU gave advice or support related to a possible forced marriage in 1,196 cases. Since 2012, the FMU has provided support to between 1,200 and 1,400 cases per year. FMU’s statistics do not represent the prevalence of forced marriage in the UK.
> Where the age was known: • 16% of cases involved victims aged 15 and under • 14% involved victims aged 16-17 • 18% involved victims aged 18-21 • 12% involved victims aged 22-25 • 10% involved victims aged 26-30 • 7% involved victims aged 31-40 • 4% involved victims aged 41 or over • 17% involved a minor whose age was not known.
> 80% of cases involved female victims and 20% involved male victims.
> The FMU has handled cases involving more than 90 countries. In 2017 these included: Pakistan (37%), Bangladesh (11%), Somalia (8%), India (7%), Afghanistan (2%), and Egypt (2%). 10% of cases were domestic and had no overseas element.
> Within the UK the regional distribution was: London 29%, West Midlands 14%, Yorkshire and the Humber 13%, North West 12%, South East 7%, East Midlands 6%, East 3%, North East 3%, South West 3%, Scotland 2%, Wales 1%. The region was unknown in 7% of cases.
> 12% of cases involved victims with disabilities.
> 2% of cases involved victims who identified themselves as lesbian, gay, bisexual or transgender (LGBT).
Digital transformation of consular services making them more accessible
Since 2014, the FCO has transformed its public services, from paper forms to digital services which we have made as accessible as possible. In 2016, we launched global online applications for Emergency Travel Documents (ETDs) and Legalisation & Documentary Services. In 2017, we expanded the ETD service to allow children’s applications to be submitted online. In financial year 17/18 over 21,000 applications for Emergency Travel Documents were made online: 72% of the total issued. Over 1,200 of these were for children. Of all payments, 30% were made online.
We test the words we use on forms to make sure they are easy to understand. We test the forms with people with different levels of computer skills and disabilities, with the FCO’s disability Staff Association Enable, and in specialist testing centres around the country. Finally, our contact centre staff are always at the end of a telephone to help people filling in the digital forms, either with specific issues or, in some cases, asking people the questions on the form and filling it in on their behalf. The services are significantly simpler and quicker to use than the old paper forms, making consular services easier to access for everyone.
Consular Services in the EU and EFTA States
Ahead of the UK leaving the European Union (EU), the FCO is supporting British people living, working and travelling in the EU and European Free Trade Association (EFTA) states. Through a communications campaign, launching in Autumn 2018, the FCO aims to ensure British people have clear and timely information about their rights and how to access them after the UK leaves the EU. The FCO is commissioning research into how best to reach the diverse population of British people living in the EU and EFTA states, including those who are not able to access information online or who may be particularly affected by any changes to their rights and status.
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c10152abd45125af966f670add5d2ff44b4aa2a8 | The National Archives Finding Archives Resources Summary Report
Published: 17th January 2012
Prepared by: Sharon Nichols, Research Director Tel: 01663 732721 Email: [email protected] Website: http://www.djsresearch.co.uk Introduction and Objectives The National Archives has conducted market research to gather feedback on the online resources which it hosts which detail material held by other repositories. This is aligned with the goal for improved online access for archive resources, as identified in the Archives for the 21st Century. This research focuses on understanding stakeholder requirements for these resources in the future. Specifically, the research objectives were as follows:
Objective 1: To understand external stakeholder requirements for The National Archives’ online resources that detail material held by other repositories (a definition of stakeholders is presented in the appendix 1)
Objective 2: To consolidate requirements gathered from external stakeholders with requirements gathered at internal workshops with The National Archives’ staff
Objective 3: To understand the functionality required of these resources by stakeholders
This research focussed on the following online resources hosted by The National Archives:
- National Register of Archives
- Manorial Documents Register
- Hospital Records Database
- Accessions to Repositories
- Access To Archives
- Archon Directory
The research did not focus on The National Archives own catalogue.
Methodology Internal Research: Initially, The National Archives, conducted internal stakeholder workshops to gather information on key issues for internal and external users and contributors as viewed by staff.
Qualitative External Research: 5 focus group discussions with both contributors to, and users of, The National Archives’ online resources were conducted across England, Scotland and Wales. In addition to this, 10 face to face depth interviews were conducted with interest group representatives, other archive networks and 9 telephone depth interviews were conducted with general users.
Quantitative External Research: An open survey was carried out online to generate a prioritised list of requirements; 179 responses were collected. This survey sat on The National Archive’s website between 25th November 2011 and 13th December 2011. The same survey was also sent to 84 stakeholders and the response rate to this was 35. All those who responded to the online survey were screened to check that they were aware of at least one of the resources that the research focussed on and had either used or contributed to at least one of them in the last 12 months.
Throughout the research with external stakeholders, respondents were asked to think of The National Archives online resources which detail material held by other repositories (as outlined earlier). Please note that feedback was not sought on a resource by resource basis. About this document This document summarises key findings from the external research, conducted by DJS Research Ltd. It is worth noting that the research that was conducted internally amongst The National Archives staff did reveal similar themes to those which arose with external stakeholders.
A positive reaction to the research With 214 responses to the online survey and over 50 external stakeholder views received through the qualitative research process, the research includes a wide range of views from different types of repositories and users of The National Archives online resources. Many of those that we spoke to in the qualitative research had to travel a long way to participate in the research. DJS Research and The National Archives wish to thank all of those who participated in the research for their time and comments. These views will help The National Archives to shape these resources moving forward.
The National Archives’ online resources are invaluable The research did reveal a number of issues with these online resources, but it is worth noting that the resources themselves were considered to be valuable by respondents. The following comment is typical:
“I can’t imagine working without any of these resources.”
However, respondents felt that the resources were developed in a less advanced digital age and there is scope to make them better – it is now possible to do much more given technological advances.
Key themes emerging from the qualitative research
Expectations for The National Archives online resources which detail material held by other repositories are shaped by what is possible to achieve with other information discovery websites. Requirements and desires for The National Archives online resources are heavily inspired by respondents’ experiences of using other popular websites such as ebay, BBCnews, google™,amazon.com, expedia (“A lot of the time on the BBC you can get to where you want without having to type in a single letter. You go to the home page and away you go.”). Needs such as a good search function, summary and in depth information and added value extras (links to Google Earth™, alternative interest points, intuitive search) are all taken from such websites.
The process of contributing information to The National Archives is problematic: Contributors also feel that the process of contributing information was frustrating and could be made easier by having fewer resources to update, better communications with The National Archives, clearer guidance and templates for providing information, greater feedback on information provided and more autonomy to update information remotely. The issue of cataloguing was a common theme amongst contributors discussing providing information: they recognise this as a sector-wide issue and look to The National Archives to provide guidance. Contributors were, however, quick to recognise the difficulty of providing a system to suit all institutions’ differing needs for providing information. The challenge, they said, arose from the differences in types of information held and also differences in available resource between different types of organisation.
The search function is extremely important: The ease and success of a search determines a users’ assessment of a website or resource, and respondents’ benchmark search function is definitely Google™. Although there seems to be no standard search profile (i.e. users search The National Archives resources in all sorts of different ways), there are some key requirements which emerge: to be able to perform an advanced search is the most important followed by being able to filter searches. Respondents also wanted to be able to search a specific resource.
**Cataloguing standards are a sector-wide issue:** Throughout the discussions, respondents raised the issue of cataloguing and standards. Users are frustrated by and wary of information returned from archival searches that are so varied in content and format, using language that is very technical in nature. In the qualitative research, respondents were all asked to search for the same piece of catalogue information. The results revealed that people started in all sorts of different places, and obtained different search results depending on how they conducted their search: respondents experienced the impact of non-standardised cataloguing first-hand.
**Awareness is an issue** Some Respondents felt that the inexperienced user may not know that these resources exist, and may struggle to find them as a result (some experienced stakeholders struggled to find these resources on The National Archives website). Some felt that less knowledgeable users may be more likely to expect to find catalogue information via Google™.
**Key insights from the quantitative research**
The online survey was based around a list of attributes (or requirements for an information discovery tool which would host The National Archives online resources detailing information held by other repositories). These attributes were generated from findings from the qualitative research. Respondents were asked to assign from 0 – 100 points per attribute, with 100 being extremely important and 0 being not important at all.
The attributes focussed on a range of areas identified as being important from the qualitative research:
- The process of contributing information (asked of contributors only)
- Entering the site and navigation
- Undertaking a search
- Refining the search
- Context and information provided as a result of the search
- What you can do with the search results (i.e. added value features)
- Access information for the records themselves
There were 47 attributes in total, and these attributes have then been ranked according to the mean score (average score) out of 100. The top 10 most important attributes are as follows (Note that there is an appendix which shows the full list of prioritised attributes):
| Rank | Attribute | Mean Score | Process | |------|---------------------------------------------------------------------------|------------|----------------------------------------------| | 1 | Ability to perform an advanced search (210) | 88.74 | Undertaking a search | | 2 | Ability to filter search results once they have been returned (213) | 86.37 | Refining a search | | 3 | Your own collection reference numbers prioritised over other unique identifier (97) | 85.68 | Updating information (contributor only) | | 4 | Presentation of results in a context which makes clear which collection each result relates to (211) | 85.26 | Context and information | | 5 | A clearly signposted search box for these resources on The National Archives website (211) | 83.67 | Entering the site and navigation | | 6 | Information about whether the document can be viewed online (213) | 82.21 | Access information | | 7 | Search results that include variations on the search term (210) | 81.41 | Undertaking a search | | 8 | Information about requirements for permission to access the original document (213) | 80.57 | Access information | | 9 | Option to choose a specific National Archives resource to search (212) | 80.08 | Undertaking a search | | 10 | Single resource to update not several (96) | 79.26 | Updating information (contributor only) |
*Figure in brackets=base size for each attribute.*
The National Archives – Finding Archives Project – Summary Report It is clear looking at the top 10 attributes that effective search functions are crucially important to successful online resources. Respondents want a clearly signposted search box and the option to search specific resources. They want mechanisms to perform an advanced search, to filter search results, which would include variations on the search term.
There was a lot of detail contained within these 47 attributes. To summarise an additional question was included in the research to understand where the balance of opinion lay. For example, did people want:
- Volume of data displayed (i.e. high number of results) vs quality of data displayed (most relevant results returned)
- Breadth (high level information about collections of data) vs Depth (detailed information about catalogues)
- Structured or filtered search vs a free text search
- Content of the collection and/or item vs Context of the collection and/or item
- Links to data held externally to The National Archives vs Data held internally by The National Archives
Respondents were asked to move a slide scale for each towards the option they most preferred. The results are shown in Appendix 4. It was clear from this exercise that respondents wanted the results to be of high quality with lots of detailed content.
**Conclusions**
The findings showed that effective search functions are crucially important to successful online resources. Respondents want a clearly signposted search box and the option to search specific resources. They want mechanisms to perform an advanced search, to filter search results, which would include variations on the search term.
Improving the processes of contributing information to the online resources is also revealed to be a priority. Contributors felt strongly in favour of having a single resource to update rather than several and want to feel that the systems are built around their needs i.e. having their own collection reference number prioritised over any others.
However, this isn’t to say that the other factors that were included in the research are not important. They are simply less important in the context of this research than other factors, and will be more important for some people. It is therefore important to not lose sight of other issues which came lower down the list. We term these as ‘enhancing factors’. Users will expect good levels of service or functionality from the most important factors as a matter of course – if this isn’t possible a supplier will find it very difficult to satisfy customers or stop them going elsewhere. Conversely, most of the added value attributes included in this research (for example, links to Google Earth™, news alerts, links to other sites, user profiles) fall towards the end of the list of prioritised attributes and can therefore be considered long term goals or *enhancers*. These are added extras, which can also positively influence the user experience and ‘delight’ users.
**Next Steps**
The next steps for The National Archives will be to consolidate these results with the findings of the internal workshops (which revealed similar themes), and identify key actions. Appendix 1: Definitions of stakeholders
Definitions of stakeholders include:
- **Contributors to resources** – those who provide information to The National Archives online resources which detail information held by other repositories
- **Users of resources** – those who use these resources, including archive professionals, academics and those using the resources to research personal interests, whose details were collected through the quantitative research. Note that in the qualitative research we did not include those who use the resources to forward personal interests
- **Organisations** which represent the archive sector Appendix 2
- Ability to perform an advanced search (210) 88.74
- Ability to filter search results once they have been returned (213) 86.37
- Your own collection reference numbers prioritised over other unique identifier (97) 85.68
- Presentation of results in a context which makes clear which collection each result relates to (211) 85.26
- A clearly signposted search box for these resources on The National Archives website (211) 83.67
- Information about whether the document can be viewed online (213) 82.21
- Search results that include variations on the search term (210) 81.41
- Information about requirements for permission to access the original document (213) 80.57
- Option to choose a specific National Archives resource to search (212) 80.08
- Single resource to update not several (96) 79.26
- Ability for repository to update information directly on The National Archives resources (98) 79.06
- High visibility of resources on the National Archives website (209) 78.52
- Inclusion of data from all main online sources (i.e. AIM 25) (201) 77.62
- Repository able to upload data directly into system, using templates provided by The National Archives (96) 76.83
- Simple and easy to use layout similar to Google® (211) 76.57
- Statistics on usage of my data (97) 75.74
- Ability to forward or download search results (209) 75.50
- Ability to perform a simple search of all the NATA archives online resources (211) 75.04
- Description of the whole collection and individual items within the collections (200) 74.26
- Information about the archival institution holding the original document (i.e. opening hours) (212) 73.80
- Results displayed in order of relevance (210) 73.76
- Ability to download information about individual catalogues, collections and repositories (210) 73.30
- Automatic harvesting of info but with an alternative for repositories that don’t hold data electronically (96) 72.24 Appendix 3
- All search results listed no matter how many (206) - 69.27
- Regular import to The National Archives system (89) - 69.18
- User guides (212) - 68.89
- Ability to bookmark individual results (209) - 68.68
- Ability to save searches (209) - 68.13
- Name authorities can be created by contributor and uploaded (97) - 67.59
- Suggestions for alternative search terms that may be of interest (209) - 65.41
- Contextual information about the types of records (209) - 64.42
- Contextual information about the people, organisations and places referred to in the collection (207) - 63.84
- Ability to search resources directly from Google® (208) - 62.42
- Name authorities can be contributed by professional archivists only (94) - 62.34
- Usage of non technical terms (205) - 61.50
- Contextual information about the archival institution holding the records (211) - 60.83
- Links to other sites which may be of interest (211) - 59.49
- News alerts when something new is added to a catalogue of interest (207) - 57.81
- Glossary of key terms (210) - 57.73
- Ability to add or annotate the information once retrieved (207) - 51.40
- Summary information about the whole collection only (204) - 51.30
- Descriptive content available as open data (91) - 49.57
- Being able to create a user profile (204) - 44.42
- Entry point that allows you to distinguish what type of user you are (204) - 43.67
- Detailed descriptions of individual items within collection without summary info about collection as a whole (205) - 41.66
- Links to Google® Earth to allow you to see where the repository is (208) - 35.57
- Name authorities that can be edited by other users (93) - 31.81
Mean score out of 100 Appendix 4
Key Themes – Where Does The Balance Of Opinion Lie?
Q. For each of the following pairs of attributes, please move the sliding scale towards the option that most interests you. If both are equally important, leave it in the middle.
| Attribute | 0% | 20% | 40% | 60% | 80% | |----------------------------|----|-----|-----|-----|-----| | Volume | 13 | 14 | 15 | 16 | 18 | | Breadth | 22 | 23 | 24 | 25 | 26 | | Structured Search | 14 | 15 | 16 | 17 | 18 | | Content of collection/item | 53 | 54 | 55 | 56 | 57 | | Links to data held externally to TNA | 38 | 39 | 40 | 41 | 42 |
Base: All Respondents (214)
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d8fa60fa823c616dec9dd63fbca1527dce7c7b3d | We have many different ways we can communicate with you If you would like us to communicate with you by braille, British Sign Language, a hearing loop, translations, large print, audio or something else please contact us. You can find our contact details by searching for the relevant benefit on gov.uk
If you want help filling in any part of this claim form, read the information booklet or call us on 0800 121 4600. If you have speech or hearing difficulties, you can contact us by textphone on 0800 121 4523. We can provide an interpreter if you phone or visit us.
About the child Please use BLOCK CAPITALS when completing the child’s names.
1 Surname or family name
All other names in full
Please also give us any other names the child has been known as
2 Child reference number (if you know it)
3 Date of birth (day/month/year)
4 Sex
Male □ Female □
5 Full address where the child lives
Postcode Special rules
Are you claiming for the child under the special rules? The special rules apply to children who have a progressive disease and are not expected to live longer than another 6 months.
Yes ☐ Please continue below. No ☐ Go to question 7.
Make sure you: • answer all the questions on the form that apply to you or the child you are claiming for • answer questions 25 to 36 if the child has any walking difficulties • you do not have to answer questions 37 to 55
To help us deal with the claim as quickly as possible it is important you send us a DS1500 report about the child’s medical condition. You can get the report from the child’s doctor or specialist. You will not have to pay for it and the child does not have to see the doctor. The doctor’s receptionist, a nurse or a social worker can arrange it for you.
If you have not got a DS1500 report by the time you have filled in the claim form, send the claim form anyway. If you wait the child’s payment could be delayed. Send the DS1500 report as soon as you can or ask your doctor or specialist to send it to us for you.
Getting Disability Living Allowance (DLA) under the special rules means: • the child gets the care part of DLA at the highest rate • they get paid straight away unless they are in a residential care home, boarding school or similar place • we deal with the claim more quickly
You must still tell us about any changes that may affect how much money the child gets.
What is the child’s nationality? For example, British, Spanish, Turkish If you are a Swiss or European Economic Area (EEA) national please complete the Swiss or EEA national additional question insert
Does the child normally live in Great Britain? Great Britain is England, Scotland and Wales.
Yes ☐ No ☐
Has the child come from another country to live in Great Britain in the last 3 years?
Yes ☐ No ☐ Go to question 9.
Which country did they come from?
What date did they arrive in Great Britain? / / /
Has the child been abroad for more than 4 weeks at a time in the last 3 years? Abroad means out of Great Britain.
Yes ☐ Please give us details below. No ☐ Go to question 10.
| Date they left | Date they came back | Where they went | Why they went | |----------------|---------------------|----------------|--------------| | / / / | / / / | | | | / / / | / / / | | | | / / / | / / / | | | | / / / | / / / | | | | / / / | / / / | | | | / / / | / / / | | | | / / / | / / / | | | Benefits from an European Economic Area state or Switzerland
Is the child’s parent or guardian getting any pensions or benefits from a European Economic Area (EEA) state or Switzerland?
Yes ☐ We will contact you about this. No ☐ Go to question 11.
Do not know ☐ We will contact you about this.
Other benefits from an EEA state or Switzerland
Is the child’s parent or guardian working in or paying insurance to an EEA state or Switzerland? By insurance we mean connected to work, like UK National Insurance.
Yes ☐ We will contact you about this. No ☐ Go to question 12.
Do not know ☐ We will contact you about this.
Is the child in an NHS hospital or hospice now? Or have they been admitted in the past 12 months?
Yes ☐ Please continue below. No ☐ Go to question 13.
Please tell us when they went in and when they came out.
| In | / | / | |----|---|---| | Out | / | / |
| In | / | / | |----|---|---| | Out | / | / |
Full name and address of the hospital or hospice
Phone number Include the dialling code.
Why did they go in?
Does or did the NHS fund their stay? Yes ☐ No ☐ Is the child in a residential college or similar place now, or have they been in the past 12 months? For example, a residential care home, boarding school or similar place. If the child is in a residential college or similar place when you claim we will not usually pay DLA care unless you are paying all the costs of their accommodation, board and personal care without help from a local or public authority.
Yes ☐ Please continue below. No ☐ Go to question 14.
Please tell us when they went in and when they came out.
| In | Out | |----|-----| | | |
| In | Out | |----|-----| | | |
Full name and address of where they are or were staying
Phone number Include the dialling code.
Does or did the local authority or a government department pay any costs for them to live there?
Yes ☐ Please continue below. No ☐ Go to question 14.
Which local authority or government department pays or paid?
We ask about people involved in the child’s care and may contact them before we make a decision. They do not decide if the child can get DLA.
In the last 12 months, has the child seen anyone apart from their GP about their illnesses or disabilities? For example, a hospital doctor, consultant, nurse, occupational therapist, physiotherapist, educational psychologist, social worker or support worker.
Yes ☐ Tell us below who they have seen. No ☐ Go to question 15.
If they see or have recently seen more than one health professional, it is important you tell us the other health professionals’ details at question 70 Extra information. This will help us deal with the claim more quickly.
Name For example, Mr, Mrs, Miss, Ms, Dr.
Profession or specialist area
Full address For example, health centre, hospital, office or their place of work.
Postcode Phone number Include the dialling code.
The child’s hospital record number You can find this on their appointment card or letter.
Which illness or disability do they see the child about?
When did they last see the child about their illness or disability?
Name of the child’s GP If you do not know the GP’s name, tell us the name of the surgery or health centre.
Full address
Phone number Include the dialling code.
When did they last see the child about their illness or disability?
Has the child had or are they waiting for tests to help diagnose, treat or monitor their illnesses or disabilities? For example, audiogram, MRI scan, cognitive development or IQ test, or something else.
Yes ☐ Tell us about it in the table below. No ☐ Go to question 17.
| Date and type of test | What did the test show? | |-----------------------|-------------------------| | Example | | | June 2016 Eyesight test | They needed to see a hospital doctor | Do you have any reports, letters or assessments about the child’s illnesses or disabilities? These may be from the people who treat or help them with their illnesses or disabilities. For example, doctors, health visitors or occupational therapists.
Yes ☐ Please continue below. No ☐ Go to question 18.
Tell us what reports you have. For example, educational psychologist’s report or Certificate of Vision Impairment (CVI). Please do not include things like appointment letters or general information about the child’s condition like fact sheets or information from the Internet.
Please send us this supporting information with this form, but make sure it is: • the most up-to-date information you have • photocopies only, we cannot return any documents • not on CD, DVD, memory stick or any type of electronic media as we cannot access these
Name of the child’s school or nursery
Full address
Phone number Include the dialling code.
Person we can contact For example, a teacher.
What sort of school is it? For example, a mainstream school or a special school that helps with the child’s illness or disability.
Does the child have or are they waiting to hear about an Educational Health and Care Plan (EHCP), Individual Education Plan (IEP), Individual Behaviour Plan (IBP) or statement of Special Educational Needs (statement)? In Scotland the statement is called a Co-ordinated Support Plan (CSP). If the child needs help under School Action or School Action Plus, a teacher prepares the IEP or IBP which sets out the help they need. If more help is needed, the local authority may complete an assessment and issue a letter, a Note in Lieu, or a statement.
Yes ☐ Please tick the boxes that apply. No ☐ Go to question 20.
Send us a copy, if you can, as it may help us deal with your claim. Please do not send original copies as they cannot be returned.
☐ They have an ECHP, IEP or IBP. ☐ They have a statement, Note in Lieu, letter or CSP. ☐ I am waiting to hear. Statement from someone who knows the child
This part does not have to be filled in but if it is filled in, this may help us deal with your claim more quickly. It could be filled in by someone who treats or is involved in the child’s care. For example, a health professional, a social worker or a teacher.
| Statement to be filled in by the person who knows the child. | |-------------------------------------------------------------| | Use the space below to tell us: | | • the child’s illnesses or disabilities and how they affect the child, and | | • how you help the child |
| Signature | Date | |-----------|------| | | |
| Name (please use block capitals) | |----------------------------------| | |
| Full address | |--------------| | |
| Phone number | |--------------| | Include the dialling code. |
| Job or profession | |-------------------| | |
| Relationship to child, if applicable. | |---------------------------------------| | |
| When did you last see the child? | |----------------------------------| | | / / | Sharing information about the child’s health condition
The Department for Work and Pensions (DWP) or approved healthcare professionals that work for DWP, might need more information about the child’s health condition and how it affects them. They might ask for relevant information from the child’s doctor, or any other relevant professional you tell them about.
Do you give consent for the child’s doctor or other relevant professionals to give DWP more information about their health condition?
Yes ☐ Information about the child’s health can be shared with DWP or the healthcare professionals that work for them.
No ☐ Information about the child’s health cannot be shared with DWP or the healthcare professionals that work for them.
How DWP uses this information
DWP uses this information to: • process the claim • make a decision on the claim, or any mandatory reconsideration or appeal you make
The law allows DWP to get, keep and use this information.
Your child’s doctor (or other relevant professionals you tell DWP about) needs your consent to give information to DWP. If you give your consent, this lets them know that they are legally allowed to share this information with DWP.
DWP can lawfully ask your child’s doctor, hospital consultant or other relevant professionals for information about their health condition and how it affects them. This is because we are asking for the information to help us carry out our official social security functions.
You do not have to give your consent. If you do not, DWP will make a decision based on the information they have already, as well as any you give them yourself.
If you change your mind
You can change your mind. You can do this by contacting 0800 121 4600 and say you want to give or withdraw your consent.
If you withdraw your consent, DWP cannot get information from the child’s doctor or others named on the form.
I have read and understood the text above.
Signature
Dated
/ / / The Motability Scheme
The Motability Scheme allows disabled people to lease a car, scooter or powered wheelchair in exchange for all or some of their mobility payments. Parents and carers can join the scheme on behalf of a child aged three and above.
If the child is eligible for help from Motability, would you like us to post you information about the help they can offer? We will not share any personal details with Motability.
Yes ☐ No ☐
If you decide you do not want to receive information about Motability in the future, please contact us on 0800 121 4600 to let us know.
The questions we ask and why we ask them
DLA is a benefit to help with extra costs because: • the child has difficulties walking, or • the child needs extra looking after, because of their illness or disability
By ‘extra looking after’ we mean much more than another child of the same age.
We ask about the child’s illnesses or disabilities, the treatment they have, the difficulties they have walking outdoors and the extra looking after they need.
We ask for a lot of information about the child, it may be easier to fill in the information in parts over a few days. Try not to worry about how long the form is, complete as much information about the child for each question that applies – take a break when you need to.
We understand it may be upsetting for you to think about what the child cannot do, but we need this information to make the right decision.
Tell us about the help they need most of the time. You can use the box at the end of each question to tell us: • about your tick-box answers • how their needs vary • anything else you think we should know about the help they need
If you need help to fill in the rest of the form
In the information booklet we: • explain the questions we ask • tell you how to answer the questions • give you examples of other things you can tell us
When you see you can use the information booklet to help you understand and answer the questions. About the child’s illnesses or disabilities
List the child’s illnesses or disabilities in the table below.
- **illness or disability** may be a physical, sight, hearing, speech, learning or developmental difficulty, or a mental-health problem. If they do not have a **diagnosis**, tell us their difficulty. For example, if they have problems learning new things and you do not know why, put ‘Learning problem’
- **how long** may be from birth or the date the problem started. It is not the date of diagnosis
- **treatment** may be medicines such as tablets, creams or injections and things like speech, occupational or play therapy, physiotherapy or counselling
- **how often** they have each treatment and for how long. The label on the child’s medicine has the name, dose and how often to take it
If you have a spare **up-to-date prescription list** send it to us with this claim form.
| Illness or disability | How long have they had it? | What treatment do they have for it? | How often do they have treatment? | |-----------------------|---------------------------|-----------------------------------|----------------------------------| | **Examples** ADHD | Problems started aged 4 | Cognitive behaviour therapy | One hourly session a week | | | | Ritalin 30 milligrams (mg) | One a day | | Eczema | About one year | Promethazine 5 mg | One before bed | | | | 1% Hydrocortisone cream | 3 times a day | | | | E45 Emollient bath oil | Daily | | Visually impaired | From birth | Play therapy | Every day |
If you need more space to tell us about their illnesses or disabilities, please continue at question 70
**Extra information.** Does the child use, or have they been assessed for, any aids or adaptations?
Yes ☐ Please continue below.\
No ☐ Go to question 24.
Tell us in the table below about any:
- aids used at home, at school or anywhere else
- aids or adaptations they have been assessed for or are waiting for
- help they need to use it. This could be encouragement, prompting or physical help
Put a tick next to the aid or adaptation if it was prescribed by a health care professional. For example, an occupational therapist.
Use page 5 of the information booklet.
| Aids and adaptations | ✓ | What help do they need to use the aid or adaptation? | |----------------------|---|-----------------------------------------------------| | Example of aid | ✓ | Encouragement to use cards to communicate | | Picture Exchange Cards| | | | Example of adaptation | | No help needed | | Bed rails | | |
If you need more space to tell us about their aids or adaptation, please continue at question 70 Extra information. When the child needs help
We understand the help a child needs can vary from day to day or week to week. To make the right decision, we need to know if the help the child needs is the same most of the time or varies.
Tick the box below that applies to them.
The help they need:
- is the same most of the time
- varies
Tell us in the box below how their needs vary.
For example:
- every 3 to 4 weeks they have a couple of good days
- they need more looking after when their condition gets worse, 2 to 3 times a year, or
- they have treatment 3 times a week and need more looking after the day after
Mobility questions
Mobility – these questions are about the difficulty that the child has walking outdoors because of their illnesses or disabilities.
Questions 25 to 31 are about the physical difficulties a child has walking. This is for children age 3 and over.
Questions 32 to 34 are about the guidance and supervision they need when walking outdoors most of the time. This is for children age 5 and over.
The following questions ask about ‘they’. This means the child you are claiming DLA for.
Mobility
These are about their ability to physically walk outdoors on a reasonably flat surface. We cannot consider any problems they have walking on steps, slopes or uneven ground. If their problems are not physical, do not answer questions 25 to 31. Tell us about any behavioural difficulties with walking at questions 32 to 34.
Can they physically walk?
Tick No if they cannot walk at all.
Yes Go to question 26.
No Go to question 36 to tell us how long they have been unable to walk.
Do they have physical difficulties walking?
This means problems with how far they can walk, how long it takes, their walking speed, the way they walk, or the effort of walking and how this may affect their health.
Yes Go to question 27.
No Go to question 32. Please tick the boxes that best describe how far they can walk without severe discomfort and how long it takes them.
This means the total distance they can walk before they stop and cannot go on because of severe discomfort. This may include short stops to catch their breath or ease pain.
We understand this can be difficult to work out.
It may help to do the following things when you are out walking with the child:
• count the steps you take to see how far they have walked. If they walk 100 of your steps, they have walked about 90 metres (100 yards) • check the time when you start and stop to see how long it takes
Use page 5 of the information booklet.
They can walk:
• over 200 metres (218 yards) • 51 to 200 metres (56 to 218 yards) • 50 metres (55 yards) or less • a few steps
It takes them:
• more than 5 minutes • 3 to 4 minutes • 1 to 2 minutes • less than a minute
Please tick the box that best describes their walking speed.
Normal This means they can easily keep up with friends.
Slow This means they can only keep up with friends with a lot of effort.
Very Slow This means they cannot keep up with friends. Please tick the box that best describes the way they walk.
They:
- walk normally
- walk with a limp
- shuffle
- drag their leg
- walk with one or both feet turned inwards
- walk on their toes
- have poor balance
If they have other difficulties with the way they walk, tell us below what they are.
Does the effort of walking seriously affect their health?
For example, walking can cause bleeding into the knee and ankle joints.
Yes □ Tell us below how their health is affected. No □ Go to question 31.
If you want to tell us why you have ticked the boxes, how their needs vary or anything else you think we should know, use the box below.
For example, they have more pain or tiredness if they walk too far the day before. Do they need guidance or supervision most of the time when they walk outdoors?
Use page 6 of the information booklet.
Yes ☐ Tick the boxes that apply. No ☐ Go to question 33.
Can they:
- find their way around places they know? ☐ ☐
- ask for and follow directions? ☐ ☐
- walk safely next to a busy road? ☐ ☐
- cross a road safely? ☐ ☐
- understand common dangers outdoors? ☐ ☐
Do they regularly:
- become anxious, confused or disorientated? ☐ ☐
- display unpredictable behaviour? ☐ ☐
- need physical restraint? ☐ ☐
Do they fall due to their disability?
Yes ☐ Please continue below. No ☐ Go to question 34.
Tell us the number of falls each month
They:
- can get up without help ☐ ☐
- have had injuries needing hospital treatment ☐ ☐
If you want to tell us why you have ticked the boxes, how their needs vary or anything else you think we should know, use the box below.
For example, they are frightened by loud noises and behave without thinking about danger. Extra information about mobility
If you want to tell us anything else about their mobility, use the box below.
When did the child’s mobility needs you have told us about start?
Normally, the child can only get the mobility part of DLA if they have needed help for more than 3 months.
Please tell us the date the mobility needs you have told us about started.
/ /
If you cannot remember the exact date, tell us roughly when this was.
If you are claiming under the special rules, go straight to question 56. Care questions
Care – these questions are about the extra looking after that the child needs because of their illnesses or disabilities. These questions are for children of all ages.
Questions 37 to 52 are about the help they need during the day.
For example, if a child gets up at 7am and goes to bed at 8pm and the parents get up at 7am and go to bed at 11pm, day time would be 7am to 11pm. Any help needed after 11pm would count as help during the night.
The following questions ask about ‘they’. This means the child you are claiming DLA for.
Care
37 Do they need encouragement, prompting, or physical help to get into or out of or settle in bed during the day?
This means waking up, lifting their legs into or out of bed, sitting up from lying down or settling in bed ready to go to sleep.
Use page 7 of the information booklet.
Yes ☐ Please continue below. No ☐ Go to question 38.
Tell us how often they need help each day and how long it takes each time.
| They need encouragement, prompting or physical help to: | How often each day? | How long each time? | |--------------------------------------------------------|---------------------|---------------------| | • wake up | | minutes | | • get out of bed | | minutes | | • get into bed | | minutes | | • settle in bed | | minutes |
If you want to tell us why they need help, how their needs vary or anything else you think we should know, use the box below.
For example, they may need to follow a set routine to go to or get out of bed. Do they need encouragement, prompting, or physical help to go to or use the toilet during the day? This means going to the toilet, managing their clothes, getting on and off the toilet, using the toilet, cleaning themselves and coping with continence care.
Use page 7 of the information booklet.
Yes ☐ Tick the boxes that apply. No ☐ Go to question 39.
They need encouragement, prompting or physical help to:
- go to the toilet ☐
- manage clothes ☐
- get on and off the toilet ☐
- wipe themselves ☐
- wash and dry their hands ☐
- manage a catheter, ostomy or stoma ☐
- manage nappies or pads ☐
If you want to tell us why you have ticked the boxes, how their needs vary or anything else you think we should know, use the box below. For example, they have pain and become distressed. Do they need encouragement, prompting, or physical help to move around indoors, use stairs or get into or out of a chair during the day?
A chair is any type of chair including a wheelchair. This means moving from one place to another, using stairs, getting into, sitting in, and getting out of a chair. Indoors is in their home, a friend’s home, school, college, or anywhere else inside.
Use page 8 of the information booklet.
Yes ☐ Tick the boxes that apply. No ☐ Go to question 40.
They need encouragement, prompting or physical help to:
• go up and down one step ☐ • go upstairs ☐ • go downstairs ☐ • move around safely ☐ • get into or out of a chair ☐ • sit in a chair ☐
If you want to tell us why you have ticked the boxes, how their needs vary or anything else you think we should know, use the box below.
For example, they bump into furniture and doors. Do they need encouragement, prompting, or physical help to wash, bath, shower and check their appearance during the day. This means getting in and out of a bath or shower, washing their hair, drying themselves, using soap, using a toothbrush and checking their appearance.
Use page 9 of the information booklet.
Yes ☐ Please continue below. No ☐ Go to question 41.
Tell us how often they need help each day and how long it takes each time.
| They need encouragement, prompting or physical help to: | How often each day? | How long each time? | |--------------------------------------------------------|---------------------|---------------------| | • have a wash | | minutes | | • clean their teeth | | minutes | | • wash their hair | | minutes | | • get in or out of the bath | | minutes | | • get in or out of the shower | | minutes | | • clean themselves in the bath or shower | | minutes | | • dry themselves after a bath or shower | | minutes | | • check their appearance | | minutes |
If you want to tell us why they need help, how their needs vary or anything else you think we should know, use the box below. For example, when they are in the bath they need telling repeatedly what to do and how to do it. Do they need encouragement, prompting, or physical help to dress and undress during the day? This means choosing the right clothes for the weather or activity, choosing clean clothes, putting clothes on in the correct order, moving their arms or legs to put clothes on or take them off. This is any dressing or undressing except when using the toilet.
Use page 10 of the information booklet.
Yes ☐ Please continue below. No ☐ Go to question 42.
Tell us how often they need help each day and how long it takes each time.
| They need encouragement, prompting or physical help to: | How often each day? | How long each time? | |--------------------------------------------------------|---------------------|---------------------| | • dress | | minutes | | • undress | | minutes | | • manage zips, buttons or other fastenings | | minutes | | • choose appropriate clothes | | minutes |
If you want to tell us why they need help, how their needs vary or anything else you think we should know, use the box below. For example, they follow a set routine that takes a long time.
Do they need encouragement, prompting, or physical help to eat and drink during the day? This means getting food into their mouth, chewing, swallowing, using cutlery, cutting up food, holding a cup, getting it to their mouth and drinking.
Use page 10 of the information booklet.
Yes ☐ Please continue below. No ☐ Go to question 43. Tell us how often they need help each day and how long it takes each time.
| They need encouragement, prompting or physical help to: | How often each day? | How long each time? | |--------------------------------------------------------|---------------------|---------------------| | • eat | | minutes | | • use a spoon | | minutes | | • cut up food on their plate | | minutes | | • drink using a cup | | minutes | | • be tube or pump fed | | minutes |
If you want to tell us why they need help, how their needs vary or anything else you think we should know, use the box below.
For example, they cannot see what food is on the plate.
______________________________________________________________________
Do they need encouragement, prompting, or physical help to take medicine or have therapy during the day?
Taking medicine includes tablets, injections, eye drops, knowing what to take, how much to take and when to take it.
Having therapy includes blood sugar testing, peak flow checks, physio, oxygen, speech, play and behaviour therapy, knowing what to do, how much to do and when to do it.
Use page 11 of the information booklet.
Yes ☐ Please continue below.\
No ☐ Go to question 44.
Tell us how often they need help each day and how long it takes each time.
| They need encouragement, prompting or physical help to: | How often each day? | How long each time? | |--------------------------------------------------------|---------------------|---------------------| | • take the correct medicine | | minutes | | • know when to take their medicine | | minutes | | • do their therapy | | minutes | | • know when to do their therapy | | minutes | If you want to tell us why they need help, how their needs vary or anything else you think we should know, use the box below.
For example, they become angry with their condition and refuse to take their medicine.
______________________________________________________________________
**Do they have difficulty seeing?**
This means when using their aids like glasses or contact lenses.
Use page 12 of the information booklet.
Yes ☐ Please continue below.\
No ☐ Go to question 45.
**Are they certified sight impaired or severely sight impaired?**
If they are certified they will have been examined at a hospital or eye clinic.\
A Certificate of Vision Impairment (CVI) will have been sent to the local social services department. You will have been given a copy.\
If they are certified, please send us a copy of the CVI. Please do not send original copies as they cannot be returned.
Certified severely sight impaired ☐ Go to question 45.\
Certified sight impaired ☐ Tick the boxes that apply.
They can see:
- computer keyboard keys or large print in a book
- a TV and follow the actions to a story
- the shape of furniture in a room
They can recognise:
- someone’s face across a room
- someone across a street
______________________________________________________________________
If you want to tell us more about the boxes you have ticked, how their needs vary or anything else you think we should know, use the box below.
For example, they have difficulty seeing in poorly lit places like a cinema.
______________________________________________________________________
**45 Do they have difficulty hearing?**
This means hearing sound or someone speaking when using their hearing aid.
Use page 12 of the information booklet.
______________________________________________________________________
**Yes** [ ] Tick the boxes that apply.\
**No** [ ] Go to question 46.
______________________________________________________________________
**Have they had an audiology test in the last 6 months?**
If you send us a photocopy of the report it may help us deal with the child’s claim. Please do not send original copies as they cannot be returned.
They can hear:
- a whisper in a quiet room
- a normal voice in a quiet room
- a loud voice in a quiet room
- a TV, radio or CD but only at a very loud volume
- a school bell or car horn
______________________________________________________________________
If you want to tell us more about the boxes you have ticked, how their needs vary or anything else you think we should know, use the box below.
For example, they cannot hear things if there is a lot of background noise. Do they have difficulty speaking? This means the ability to say words out loud and talk clearly.
Use page 13 of the information booklet.
Yes ☐ Tick the boxes that apply. No ☐ Go to question 47.
They can:
- speak clearly in sentences ☐ ☐
- put words together to make simple sentences ☐ ☐
- speak single words ☐ ☐
They can communicate using speech:
- with someone they know ☐ ☐
- with someone they do not know ☐ ☐
If you want to tell us more about the boxes you have ticked, how their needs vary or anything else you think we should know, use the box below. For example, they get embarrassed about the way they talk and will only speak to people they know.
______________________________________________________________________
Do they have difficulty and need help communicating? This means passing on information, asking and answering questions, telling people how they feel, giving and following instructions.
Use page 14 of the information booklet.
Yes ☐ Tick the boxes that apply. No ☐ Go to question 48.
To communicate they use:
- writing ☐ ☐
- BSL (British Sign Language) ☐ ☐
- lip-reading ☐ ☐
- using hand movements, facial expressions and body language ☐ ☐
- Makaton ☐ ☐ If they use another form of communication, tell us below what it is. This could be Sign Supported English (SSE), Signed English (SE), Finger Spelling, Picture Exchange Communication System (PECS), Tadoma or something else.
They can communicate:
- with someone they know
- with someone they do not know
If you want to tell us more about the boxes you have ticked, how their needs vary or anything else you think we should know, use the box below.
For example, they may be at risk because they do not understand a warning.
Do they have fits, blackouts, seizures, or something similar? This means epileptic, non-epileptic or febrile fits, faints, absences, loss of consciousness and ‘hypos’ (hypoglycaemic attacks).
Use page 15 of the information booklet.
Yes ☐ Tick the boxes that apply. No ☐ Go to question 49.
Tell us what type they have and what happens
They:
- can recognise a warning and tell an adult
- can recognise a warning and take appropriate action
- have no warning
- have had a serious injury in the last 6 months because of a fit, blackout or seizure
- display dangerous behaviour after a fit, blackout or seizure Tell us:
- the number of days affected each month
- how many fits they have on these days
- the number of nights affected each month
- how many fits they have on these nights
**Have they had an episode of status epilepticus in the past 12 months?** This is where there is persistent epileptic activity for more than 30 minutes, or they have several seizures without becoming conscious between each seizure.
Yes [ ] No [ ]
If you want to tell us more about the boxes you have ticked, how their needs vary or anything else you think we should know, use the box below. For example, they become distressed and need reassurance.
______________________________________________________________________
**Continue at question 70 if necessary.**
**Do they need to be supervised during the day to keep safe?** This means they need someone to keep an eye on them because of how they feel or behave, or how they react to people, changing situations and things around them.
Use page 16 of the information booklet.
Yes [ ] Tick the boxes that apply. No [ ] Go to question 50.
Can they:
- recognise and react to common dangers? [ ] [ ]
- cope with planned changes to daily routine? [ ] [ ]
- cope with unplanned changes to daily routine? [ ] [ ] Do they regularly:
- feel anxious or panic?
- become upset or frustrated?
- harm themselves or others?
- feel someone may harm them?
- become verbally or physically aggressive or destructive?
- act impulsively?
- have tantrums?
If you want to tell us why you have ticked the boxes, how their needs vary or anything else you think we should know, use the box below.
For example, they behave without thinking about dangers or how it will affect others.
______________________________________________________________________
Do they need extra help with their development?
This means any extra help they need to improve their understanding of how to behave and react to people, situations and things around them.
Use page 16 of the information booklet.
______________________________________________________________________
Yes\
No
Tick the boxes that apply.
They need help to:
- understand the world around them
- recognise their surroundings
- follow instructions
- play with others
- play on their own
- join in activities with others
- behave appropriately
- understand other people’s behaviour If you want to tell us why you have ticked the boxes, how their needs vary or anything else you think we should know, use the box below.
For example, they may have difficulty making friends.
______________________________________________________________________
**51**
Do they need encouragement, prompting or physical help at school or nursery?
Use page 17 of the information booklet.
Yes ☐ Tick the boxes that apply. No ☐ Go to question 52.
They need encouragement, prompting or physical help to:
- go to and use the toilet ☐ ☐
- safely move between lessons ☐ ☐
- change into different clothes for physical education and other school activities ☐ ☐
- eat meals ☐ ☐
- take medicine or do their therapy ☐ ☐
- communicate ☐ ☐
What extra help do they need with learning?
______________________________________________________________________
What is their behaviour like at school or nursery?
______________________________________________________________________
How do they usually get to and from school or nursery? If you want to tell us more about the boxes you have ticked, how their needs vary or anything else you think we should know, use the box below.
For example, they have one-to-one help from a teaching assistant.
______________________________________________________________________
Do they need encouragement, prompting or physical help to take part in hobbies, interests, social or religious activities?
Use page 18 of the information booklet.
Yes ☐ Please continue below. No ☐ Go to question 53.
Tell us:
• what they do or would do if they had help • what help they need or would need to do this • how often they do it or would do it if they had the help, and • how long they need or would need help each time
At home
| Activity | Help needed | How often? | How long each time? | |----------|-------------|------------|---------------------| | Example | | | | | Art | Encouragement to get paints, brushes and paper. Motivate to keep interested. Help to wash hands afterwards. | 2 times a week | One hour |
______________________________________________________________________
Please continue below. When they go out
| Activity | Help needed | How often? | How long each time? | |----------|-------------|------------|---------------------| | Example | Swimming | To get changed, to get in and out of the pool, to dry themselves. | Once a week | 45 minutes |
Do they wake and need help at night, or need someone to be awake to watch over them at night?
Question 53 is about the help needed during the night.
Night is when everyone in the house is in bed. For example, if a child goes to bed at 8pm and the parents go to bed at 11pm, night would start at 11pm. Any help needed before 11pm would count as help during the day.
Use page 19 of the information booklet.
Yes ☐ Please continue below.\
No ☐ Go to question 54.
Tell us how often each night they need help and how long it takes each time.
They need encouragement, prompting or physical help to:
- get into, get out of or turn in bed
- get to and use the toilet, manage nappies or pads
- have treatment
- settle or re-settle
| Help needed | How often each night? | How long each time? | |-------------|-----------------------|---------------------| | | | minutes |
They need watching over because they:
- are unaware of danger and may harm themselves or others
- may wander about
- have behavioural problems
| Help needed | How often each night? | How long each time? | |-------------|-----------------------|---------------------| | | | minutes | If you want to tell us why they need help or watching over, how their needs vary or anything else you think we should know, use the box below.
For example, they do not sleep regular hours each night.
Extra information about care
If you want to tell us anything else about their care needs, use the box below.
When did the child’s care needs you have told us about start?
Normally, the child can only get the care part of DLA if they have needed help for more than 3 months.
Please tell us the date the care needs you have told us about started.
/ / /
If you cannot remember the exact date, tell us roughly when this was. About you
Use this page to tell us about yourself, not the child.
56 Your surname or family name
All other names in full
Title For example, Mr, Mrs, Miss, Ms
57 Your date of birth
58 Your National Insurance number
Letters Numbers Letter
59 Address if different to the child’s
Postcode
60 If you live in Wales and would like us to contact you in Welsh, tick this box.
61 Your daytime phone number where we can contact you or leave a message.
Phone number Include the dialling code.
Mobile phone number, if different.
If you have speech or hearing difficulties and want us to contact you by textphone, please tick this box.
Textphone number
62 What is your relationship to the child?
63 What is your nationality?
64 What is the Child Benefit number for the child? About Income Support
65 Are you getting or waiting to hear about Income Support?
No ☐ Yes ☐
66 Is anyone within your household getting or waiting to hear about Income Support?
No ☐ Yes ☐ Please tell us their name:
Their National Insurance number:
Letters Numbers Letter
Their relationship to you:
About tax credits
67 Is anyone within your household getting or waiting to hear about Child Tax Credit?
No ☐ Yes ☐ Please tell us their name:
Their National Insurance number:
Letters Numbers Letter
Their relationship to you:
68 Is anyone within your household getting or waiting to hear about Working Tax Credit?
No ☐ Yes ☐ Please tell us their name:
Their National Insurance number:
Letters Numbers Letter
Their relationship to you: How we pay you
Please tell us your account details below.
You must read pages 19 and 20 of the information booklet before you fill in the account details.
It is very important you fill in all the boxes correctly, including the building society roll or reference number, if there is one. If you tell us the wrong account details, the payment may be delayed or the child may lose money.
Name of the account holder Please write the name of the account holder exactly as it is shown on the debit card, statement or chequebook.
Full name of bank or building society
Sort code Please tell us all 6 numbers, for example: 12-34-56.
Account number Most account numbers are 8 numbers long. If your account number has fewer than 10 numbers, please fill in the numbers from the left.
Building society roll or reference number If you are using a building society account you may need to tell us a roll or reference number. This may be made up of letters and numbers, and may be up to 18 characters long. If you are not sure if the account has a roll or reference number, ask the building society.
You may be getting other benefits and payments we do not pay into an account. If you want us to pay them into the account above, please tick this box. Extra information
Tell us anything else you think we should know about the child’s claim.
If you need more space continue on a separate piece of paper. Please put the child’s name and date of birth on any extra pieces of paper you send us. Declaration
We cannot pay any benefit until you have signed the declaration and returned the form to us. Please return the signed form as soon as you have completed it.
I declare the information I have given on this form is correct and complete as far as I know and believe.
I understand that if I knowingly give false information, my benefit may be stopped and I may be liable to prosecution or other action.
I understand that I must promptly tell the office that pays the child’s Disability Living Allowance of anything that may affect my entitlement to, or the amount of, that benefit.
I understand that the Department for Work and Pensions may use the information which it has now or may get in the future to decide whether I am entitled to:
• the benefit I am claiming for the child • any other benefit I have claimed • any other benefit I may claim or be awarded in the future
This is my claim for Disability Living Allowance.
Signature
Date
Print your name here
Send the claim form and the documents listed above back to us straight away in the envelope we have sent you. It does not need a stamp. You can send more information to us at any time.
How DWP collects and uses information
When we collect information about you we may use it for any of our purposes. These include:
• social security benefits and allowances • child maintenance • employment and training • investigating and prosecuting tax credits offences • private pensions policy and • retirement planning
We may get information about you from other parties for any of our purposes as the law allows to check the information you provide and improve our services. We may give information about you to other organisations as the law allows, for example to protect against crime.
To find out more about our purposes, how we use personal information for those purposes and your information rights, including how to request a copy of your information, please visit www.gov.uk/dwp/personal-information-charter What to do now
Check you have filled in all the questions that apply to you or the child you are claiming for:
- check you have included full details of your GP at question 15
- included full details for anyone else you have seen at question 14
- you have ticked the relevant box and signed the consent at question 21
- you have given us any extra information at question 70
- if your claim is going to be late getting to us, you tell us the reason at question 70
- you have signed the declaration at question 71
- check the person whose details are in About You at question 56 is the person who signs the consent and declaration
Make sure you have given as much information as you can.
Read pages 3 to 6 of the information booklet about how we collect and use information and for help and advice about other benefits.
List below all the supporting information you are sending with this claim form. For example, a prescription list, medical report or a statement of Special Educational Needs.
Only send photocopies of up-to-date supporting information you already have as we cannot return any originals.
Please do not include things like appointment cards or general information about the child’s condition like fact sheets or information from the Internet.
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e0c24aed5f3b85846c7953f4ed28acd605d53b86 | The UK Debt Management Office (DMO) was established on 1 April 1998. The DMO's remit is to carry out the Government's debt management policy of minimising financing costs over the long term, taking account of risk, and to minimise the cost of offsetting the Government's net cash flows over time, while operating in a risk appetite approved by Ministers in both cases.
Due to the specialist technical nature of the roles within the Agency, there is no hierarchical grading structure below SCS level. For the purposes of the organogram all posts have been split into two generic categories of staff; those of the Policy & Markets staff, who are involved with the core activities of interpreting government policy and executing gilt and cash dealing activities; and those of Operations & Resources, who provide the infrastructure to support the core activities.
Staff are remunerated according to the nature of their role, more often than not with a background from the financial services sector, and therefore the DMO does not operate with either a grading structure or pay bands.
In the organisation chart, the resource costs have been given for the two areas of Policy & Markets and Operations & Resources, where a number of teams have fewer than 5 FTE staff. Data have therefore been aggregated where this could otherwise lead to the identification of protected personal data about individual staff members.
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e862e78a973d8ac369f64d25cdbd33fe1ba96225 | Discovery Metadata Service Collection Interface Specification
Version 0-8 March 2013 Document Control
Change Summary
| Version | Date | Author/Editor | Change Summary | |---------|------------|------------------------|-------------------------------------------------------------------------------| | 0-1 | 10/11/2010 | Tim Manning | Initial draft version, based on internal UKLP design position paper. | | 0-2 | 19/11/2010 | Peter Parslow/Tim Manning | Revised draft following internal technical review. Addition of WAF interface specification from John Bywater. | | 0-3 | 23/11/2010 | Tim Manning | Minor changes only, following the creation of draft Edition 2 of DMS Operational Guide. | | 0-4 | 04/02/2011 | Rod Kedge | Changes incorporating comments from CoI following development of harvesting functionality | | 0-8 | 13/03/2013 | Ian James / David Read | Updated to clarify harvesting mechanisms for WAF, and include a single GEMINI2 record option. Other minor changes, clarifications and corrections, including creation of the “Processing the records” section, with an elaboration on validation process. |
References
| Ref. | Author/Title/Version/Date of Publication | |------|-----------------------------------------| | [1] | UK Location, “Getting Started Guides” | | [2] | UK Location, “Discovery Metadata Service Operational Guide” | | [3] | Open GIS® Catalogue Services Specification OGC 07-006r1 / 2.0.2 with second corrigendum / 2007-02-23 / Ed Douglas Nebert et al | | [4] | UK Location, “UK GEMINI Encoding Guidance” | | [5] | UK Location, “UK GEMINI Schematron Schema Constraints” | | [6] | UK Location, “UK GEMINI Schematron Schema Guidance” |
## Glossary
The following definitions apply in relation to this document:
| Term | Definition | |--------------------|-------------------------------------------------------------------------------------------------------------------------------------------| | CSW | See OGC CSW | | Data.gov.uk | The UK Government data portal, used by UK Location to publish location metadata, and by Data Publishers to register their published data and services. | | Discovery Metadata | Information about a data or service resource, used to discover and access its suitability for sharing or re-use. | | INSPIRE | Infrastructure for Spatial Information in Europe | | OGC CSW | Open Geospatial Consortium’s Catalogue Services for the Web. The HTTP protocol binding for OpenGIS® Catalogue Services. | | UK Location (UKL) | Brand name and abbreviation for the UK Location Information Infrastructure. | | UKLP | UK Location Programme. The cross-government business change programme for the design, build and deployment of the central components of the UK Location Information Infrastructure and the coordination of data publishing by data providers. | | URL | Uniform Resource Locator. | | WAF | A Web Accessible Folder (WAF) is an HTTP accessible directory of files, typically metadata files in XML format, in which all files and their time-stamps are visible to a web browser or client. Crawlers are able to parse the file listings and date-time stamps and provide a search interface on these documents. | | XML | eXtensible Markup Language | | XML Document | A collection of data represented in XML. |
© Crown copyright, 2013
You may use and re-use the information in this publication (not including logos) free of charge in any format or medium, under the terms of the [Open Government Licence](https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/). Contents
Introduction .......................................................................................................................... 5 Target Audience .................................................................................................................. 5 Assumed Knowledge .......................................................................................................... 5 DMS Resources .................................................................................................................. 6 Where to Obtain More Information .................................................................................. 6
Publishing Discovery Metadata .......................................................................................... 7
Registering the Collection Source ....................................................................................... 8
Collecting from OGC CSW ................................................................................................. 9 Collection Process ............................................................................................................. 10 GetRecords operation: Retrieving the identifiers ......................................................... 10 GetRecordByID: Collecting the Resources .................................................................... 10 Other HTTP headers ...................................................................................................... 10
Collecting from a WAF ....................................................................................................... 11 Collection Process ............................................................................................................. 11
Collecting from a single GEMINI2 record ......................................................................... 12 Collection Process ............................................................................................................. 12
Processing the records ....................................................................................................... 13 Initial checks ...................................................................................................................... 13 Validation checks .............................................................................................................. 13 Adding to the metadata catalogue ..................................................................................... 13
Collection Interface Error handling ................................................................................... 15 Introduction
1 The UK Location Discovery Metadata Service (DMS) lies at the heart of the UK Location Information Infrastructure (UK Location) and the delivery of the UK Location Strategy and INSPIRE - 'to know what data we have'.
2 The Discovery Metadata Service underpins the coordinated and regulated publishing of public sector location information to the INSPIRE standards and UK Location application profiles. It allows data users to evaluate and use public sector location information using on-line services - to view, download and invoke as part of an end business application.
3 This specification defines the mechanism by which discovery metadata resources will be collected, following their registration with UK Location.
4 This specification is intended to support engagement with UK Location Data Providers, Publishers and their suppliers in establishing their initial operating capability.
5 The XML samples in this document have not been validated, and are provided for illustration purposes only.
6 Please note that whilst the Devolved Administrations of Scotland, Wales and Northern Ireland are part of UK Location, they may have different publishing mechanisms to those described here. Therefore in the first instance, please use the appropriate contact information listed under “Where to obtain more information” below.
Target Audience
7 The primary audience for this specification are those responsible for establishing a data publishing capability within Data Provider and Publisher organisations, and solution suppliers to these organisations.
Assumed Knowledge
8 This document assumes that the reader is familiar with the UK Location “Getting Started” series of guides [1]. This specification should also be read in conjunction with the DMS Operational Guide [2]. DMS Resources
The latest versions of all the UK Location resources referred to in this guide can be found via the UK Location Resource Centre:
http://location.defra.gov.uk/resources/discovery-metadata-service
Where to Obtain More Information
The latest information, and additional resources, can be obtained by visiting the UK Location web site.
If you would like to contact the UK Location Helpdesk please use the contact form at: http://location.defra.gov.uk/resources/contact-us/
If you are looking to publish location information specific to Scotland, Wales or Northern Ireland, please contact them as detailed at http://data.gov.uk/location/contact_points. Publishing Discovery Metadata
Publishing location information into the UK Location Information Infrastructure is achieved by creating and publishing discovery metadata resources. These describe the data and the associated on-line services through which the data is published. These discovery metadata resources make the data and on-line services discoverable.
The publishing of these resources into UK Location is a two stage process:
1. **Publish discovery metadata resources** to a master repository, from which the resources can be machine-accessed from the Internet
2. **Register the published discovery metadata resources** with data.gov.uk, such that they can be collected and incorporated into the data.gov.uk discovery metadata catalogue and subsequently used as part of data.gov.uk and UK Location discovery services.
Discovery metadata resources can be collected from one of three publishing mechanisms:
- OGC Catalogue Service for the Web (CSW); or
- Web Accessible Folder (WAF); or
- Single GEMINI2 document
This document specifies how the UK Location central registration client application, hosted on data.gov.uk will interact with these interfaces to collect discovery metadata resources from the registered source.
This interface specification does not include any mechanism to withdraw a metadata resource from the DMS. Details of the process for withdrawing metadata records are detailed in the DMS Operational Guide [2]. Registering the Collection Source
The Data Publisher will enter resource details on the relevant page of data.gov.uk. The following details will be required:
- **URL for source of metadata**
- For a CSW, this will be the root URL of the OGC CSW, e.g. http://www.someserver.com/csw/csw.cgi or .../geonetwork/srv/en/csw.
- For a WAF, this will be the URL of an HTML document which contains links to one or more Gemini XML metadata documents (e.g. http://www.someserver.com/waf/index.html). The referenced metadata documents MUST be directly contained in the same folder as the HTML document, and the links to the metadata document MUST be relative (e.g. “metadatapage.xml”) and not full paths.
- For a Single GEMINI2 document, this will be the URL of a single Gemini XML metadata document (e.g. http://www.someserver.com/waf/metadatarecord.xml)
- **Source type** - corresponding to the type of source for which the URL was provided - either CSW, WAF or Single GEMINI 2 Document.
- **Publisher** - the harvested data will be filed under this organization, which corresponds to the 'Provider' in INSPIRE terminology. The list of options in the form includes only those publishers for which the logged-in user has 'editor' or 'admin' privilege.
- **Registration Description** – an optional free text field for recording any relevant details about the registration. This is to assist Data Publishers to manage their Registrations on data.gov.uk.
This is equivalent to the OGC CSW Harvest operation and response. The operation will be asynchronous, in OGC CSW terms – the DMS does not start to collect records immediately after registration.
Sources will be harvested in response to a 'Refresh' request by the user. Harvest requests are batched by data.gov.uk, and processed at regular intervals. Collecting from OGC CSW
Data.gov.uk will act as a client interfacing to OGC Catalogue Servers supporting CSW 2.0.2 [3]. It does not support earlier OGC CSW versions such as 2.0.1.
When harvesting from a CSW data.gov.uk implicitly assumes the following:
- Resource type – fixed as http://www.isotc211.org/schemas/2005/gmd/, the namespace URI identifying ISO 19139 encoded records. Beyond this, the interface requires these to be GEMINI2 records
- Resource format – fixed as application/xml
The collection interface may attempt GetCapabilities requests at any time after registration. It will use OGC CSW GetRecordByID operations to collect discovery metadata resources, after an initial GetRecords to retrieve the relevant IDs. The DMS will not use or support any other OGC CSW operations.
Amongst the various implementation options described within the OGC Catalogue Services Specification, the DMS will use HTTP GET and/or POST with XML payload.
After the initial GetRecords to retrieve identifiers, the DMS will request and expect all the values in the record, that is, we will not constrain by element name.
The 'payload' to be transferred in response to the GetRecordByID requests will be ISO 19139 XML encoded UK GEMINI records. Collection Process
Collecting discovery metadata resources from an OGC CSW interface will involve the following steps.
GetRecords operation: Retrieving the identifiers
The collection interface will issue a GetRecords, to establish the size of the job, and collect the resource identifiers. Note that these will be the target catalogue’s internal identifiers, not necessarily the fileIdentifier of the metadata Resource itself.
This will have the parameters defined in table 1.
| Element / attribute | Value | Notes | |---------------------|------------------------|--------------------------------------------| | service | “CSW” | Fixed | | version | “2.0.2” | | | REQUEST | “GetRecords” | Fixed | | resultType | “results” | | | ElementName | “dc:identifier” | The IDs do not need to be encoded in GEMINI/ISO 19139 |
Table 1: GetRecords Parameters
All other (optional) GetRecords elements and attributes will be left out, as the interface will work against the defaults.
GetRecordById: Collecting the Resources
Following the Getrecords operation, the collection interface will request the discovery metadata resources by ID.
| Element / attribute | Value | Notes | |---------------------|------------------------|--------------------------------------------| | service | “CSW” | Fixed | | version | “2.0.2” | | | REQUEST | “GetRecordById” | | | outputSchema | “http://www.isotc211.org/schemas/2005/gmd/” | In order to get ISO 19139 encoded records | | Id | comma separated list of IDs | Precisely the strings returned by that catalogue server. |
Table 2: GetrecordsById Attributes
Other HTTP headers
All other http headers are expected to have default values. Collecting from a WAF
A Web Accessible Folder (WAF) is an HTTP accessible directory of files, typically metadata files in XML format, in which all files are visible to a web browser or client, in this case data.gov.uk. The DMS metadata collection interface will use the specified URL of the file server to collect discovery metadata resources published by the Data Publisher.
Collection Process
An HTTP GET request will be sent using the registered locator. An error will be raised if there is no response.
The returned HTTP response body is parsed as an HTML document.
Links are extracted from the HTML document using XPath "//a/@href". Extracted links will be ignored if they contain characters ‘/’, ‘?’, ‘#’ or the string ‘mailto:’. That is, only relative links that refer to directly contained files will be used.
Locators of contained metadata resources are derived by appending extracted links to the registered WAF location (if necessary, a trailing slash will be appended to the registered WAF location). An error will be raised if zero metadata locators are derived from the WAF locator.
An HTTP GET request will be sent for each of the derived locators.
The returned HTTP response body is expected to be a metadata resource (XML document). An error will be raised if it is malformed XML.
If the response body does look like a GEMINI XML document [4], it will be taken forward for validation and inclusion in the central catalogue.
If the response body does not look like a GEMINI XML document [4], it will be ignored. Collecting from a single GEMINI2 record
Collecting discovery metadata resources from a single GEMINI2 document will involve the following steps.
Collection Process
An HTTP GET request will be sent using the registered locator. An error will be raised if there is no response.
The returned HTTP response body is expected to be a metadata resource (XML document). An error will be raised if it is malformed XML.
If the response body does look like a GEMINI XML document [4], it will be taken forward for validation and inclusion in the central catalogue.
If the response body does not look like a GEMINI XML document [4], an error will be raised. Processing the records
Initial checks
After receiving the discovery metadata resources, some initial checks are done on the metadata.
- If the Metadata date in any record is not newer than a corresponding existing record in data.gov.uk then harvesting of that record will be discontinued.
- If two records with the same File Identifier are received, the one with the more recent metadata date will be retained.
Validation checks
Individual records will then be validated against a set of business rules. This validation is to ensure compliant with the INSPIRE Regulations and conformance with INSPIRE and UK Location guidance.
Discovery metadata records will be:
- cross-checked against the associated Data Provider details held on data.gov.uk
- validated against the ISO 19139 schemas - UK Location / data.gov.uk use the XSD files provided by EDEN, see [4]
- validated against the ISO 19139 Table A.1 Constraints Schematron schema - the Schematron schema relies on hardcoded XPath statements which will only work effectively on a schema valid XML set
- validated against the GEMINI2 Profile Schematron schema [5] [6]
Adding to the metadata catalogue
Each resource that passes all these checks (initial and validation) will then be added to the data.gov.uk metadata catalogue. If the resource has passed all these checks and has a fileIdentifier that matches an existing entry, it will replace that entry.
If a metadata record is harvested with the same file identifier as an existing withdrawn entry, but with a more recent metadata date, then that newly harvested record will be re-instated at data.gov.uk.
1 Note that on data.gov.uk Data Provider details are held within a registry labelled “Data Publisher”, i.e. the Data Provider is referred to as the “Data Publisher”, both when publishing directly and through a third party Data Publisher. The discovery metadata resource XML document itself will be stored for use within the data.gov.uk client application and for subsequent publishing through the Discovery Metadata Service Catalogue Publishing service. Collection Interface Error handling
Errors will be reported in the Harvest Dashboard, visible to the Data Publisher when logged into data.gov.uk. This will include:
- HTTP time outs, that may suggest the CSW is ‘down’ or the Web Accessible Folder cannot be accessed
- CSW error responses to GetRecords requests
- Discovery metadata resources not associated with the Data Provider identified as part of the registration
- Invalid XML documents, i.e. fail XSD and Schematron validation
If a validation step results in a failure then any subsequent XML Validation steps are not carried out.
Once a discovery metadata resource has been registered, the resource should never be removed from the source location. UK Location will monitor ‘aged records’, i.e. discovery metadata resources that have not been updated in-line with the “Frequency of Update” value for the dataset or series.
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71febfc935c04ad7cca05f793e48288f133e8806 | What can we learn about England in the 11th century? Introduction
Lesson at a Glance
Suitable For: KS3, KS2
Time Period: Medieval 1066-1485
Curriculum Link: The development of Church, state and society in Medieval Britain
- The Norman Conquest
- The Viking and Anglo-Saxon struggle for the Kingdom of England to the Time of Edward the Confessor
- Edward the Confessor and his death in 1066
Learning Objective: To closely examine a document in order to discover information.
To consider what life was like in England in the 11th century.
Resources needed: Printed sources and questions
Domesday Book
Domesday Book is the oldest government record held in The National Archives. In fact there are two Domesday Books – Little Domesday and Great Domesday, which together contain a great deal of information about England in the 11th century. In 1086, King William I (the Conqueror) wanted to find out about all the land in his new kingdom: who owned which property, who else lived there, how much the land was worth and therefore how much tax he could charge, so he sent official government inspectors around England to ask questions in local courts.
Fixed questions were asked, such as what the place was called, who owned it, how many men lived there, how many cows were there and so on. For each property, the questions were asked three times to see what changes had happened over time so that the king would know about the lands in Edward the Confessor’s time (before 1066), who William I had given it to and what it was worth then, and finally what the situation was in 1086 at the time of the survey. All the results of these questions were handwritten into the Domesday Book by scribes.
Contents:
Teacher’s notes: .......................................................... 3 Source One: ................................................................. 4 Questions: .................................................................. 5
Useful links:
British Normans (http://www.bbc.co.uk/history/british/normans/) The story behind the Battle of Hastings and the leaders who fought it out in 1066.
The Domesday Book Online (http://www.domesdaybook.co.uk/) This site gives background information to Domesday Book, its creation, historical context, and a timeline.
This resource was produced using documents from the collections of The National Archives. It can be freely modified and reproduced for use in the classroom only. Teacher’s notes
This lesson could be used for History at key stage 3, within the development of Church, state and society in Medieval Britain 1066-1509.
The activities also support the key stage 3 literacy strategy for the development of writing. Students can attempt to locate the English words within the Latin original, and consider the development of the English language.
Finally, the questions could also be used with key stage 2 pupils, fitting in with studies of Edward the Confessor as well as contributing to the key stage 2 numeracy strategy.
Background
On 5 January 1066, Edward the Confessor, the King of England, died. Harold Godwin was crowned King of England. Two other men claimed that the throne belonged to them: Harold Hardrada, King of Norway; the other was William Duke of Normandy. Harold Hardrada invaded the north of England but the King managed to defeat his army. Shortly after, William – had landed in the south of England. On 14 October 1066, the English and Norman armies clashed in a battle just outside Hastings, in which Harold died – legend has it that King Harold was shot in the eye by an arrow! William, Duke of Normandy was crowned King of England on Christmas Day 1066.
William took all the land and important jobs in the Government and Church away from the Saxons and divided it up amongst his Norman friends. He built castles to make the English feel so scared that they would not dare even to think about causing trouble. By 1085, William had a shortage of money and also many Normans had begun to disagree amongst themselves over the land they had been given as a reward for helping conquer England. William wanted to settle these disputes once and for all. Thus William decided to order a survey. The survey would list all the land in England. It would list who was looking after each area, what lands they had, and which other people lived there. Importantly, the survey would find out how much tax-money William could get from this land. Official government inspectors were sent around the country to gather information. The people in England spoke Saxon English and the Norman inspectors spoke French and Latin. A jury, which included the local important men such as the village priest and reeve who could understand the different languages, had to decide whether their neighbours were telling the truth.
The results of this survey were written into Domesday Book. Great Domesday contains most of the counties of England and was written by one scribe and checked by a second. Little Domesday, which contains the information for Essex, Norfolk and Suffolk, was probably written first and is the work of at least six scribes. Domesday Book describes almost all of England and more than 13,000 places are mentioned in it. Most of them still survive today. London, Winchester, County Durham and Northumberland were not included in King William’s survey. In spite of these omissions, the survey gives a wealth of information, as well as highlighting that a lot of property had been destroyed by William’s invasion in 1066. Most of the land originally owned by 2000 Saxons belonged to 200 Norman barons in 1086, showing just how powerful the Norman lords had become! Source One: Great Domesday
Extract of page from Vol. 1 of Great Domesday, showing survey entry of Preston Hundred in Sussex
Transcript
IN PRESTETUNE HUND. Ipse Wills ten PICEHA in dnio. Herald tenuit. T.R.E. Tc se desd p LX. hid. m p. XL. Tra. e qt XX. car. In dnio. VIII. car. CXLX.III. uilli XL.V. bord cu qt XX II. car. Ibi aeccla .VI. serui . X. berquarij. Ibi qt XX IIII. ac pti. silua. c. porc. In Lewes . XXVI. hagae . de . XIII. solid. De hac tra ten Ricoard VII. hid. miles ej . I. hid dim. In dnio hnt .II. car. . cu . II. bord. T.R.E.ualeb tot . c .lib . post . L . lib .m . qt XX . lib.
Translation
In PRESTON Hundred William holds PATCHAM himself, in lordship. Earl Harold held it before 1066. Then it answered for 60 hides; now for 40. Land for 80 ploughs. In lordship 8 ploughs; 163 villagers and 45 smallholders with 82 ploughs; A church; 6 slaves; 10 shepherds; meadow, 84 acres; woodland, 100 pigs; 26 sites in Lewes at 13s. Richard holds 7 hides of this land; and a man-at-arms of his 1/2 hides. In lordship they have 2 ploughs, with 2 smallholders. Total value before 1066 £100; later £50; now £80. Domesday Book - Questions
01. Who holds Patcham after 1066? How did the change in ownership of land help William increase his control over the country?
02. What is a 'hide'?
- a type of peasant
- a shelter
- a measurement of land
- a place where you cannot be seen
03. How many oxen are there in the village? Remember each plough is pulled by a team of eight oxen.
04. How many people live in this village?
05. Make a list of all the people in the village, starting with those who hold the most land and ending with the poorest members of the village.
06. Name two jobs, apart from ploughing, which this source reveals.
07. Work out the number of acres of land in the village. Remember one hide = 120 acres; an acre is roughly the size of a football pitch.
08. What do you think the woodland was used for?
09. What was the value of the land when William the Conqueror became king in 1066? What had happened to its value by 1086?
10. Think about your answers for question 9. Why do you think King William was interested in knowing the value of the land?
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aebd904621b32863ff6036dd5200aafc58df17b9 | Proposal on the Collection and Preservation of UK Offline and Microform Publications and UK Online and Microform Publications and UK Online Publications Available Free of Charge and Without Access Restrictions
1. Background on the Advisory Council on National Records and Archives
1.1 The function of the Lord Chancellor's Advisory Council on National Records and Archives is to advise the Lord Chancellor, and through him other ministers as appropriate, on all matters relating to records and archives in the United Kingdom and in particular in England and Wales. It is chaired by the Master of the Rolls.
1.2 The Advisory Council on National Records and Archives embraces two further bodies: the Advisory Council on Public Records, established by s1(2) of the Public Records Act 1958(2), and the Advisory Council on Historical Manuscripts, established by the Lord Chancellor to advise him on matters formerly the responsibility of the Royal Commission on Historical Manuscripts. All three bodies share the same members.
1.3 The terms of reference of the Advisory Council on National Records and Archives are to consider and advise the Lord Chancellor upon:
- Major objectives, programmes and policy changes for The National Archives
- Proposed legislation affecting The National Archives
- The implications for records and public services of any proposed change to the status of The National Archives
- Any subjects brought to its attention by the Lord Chancellor
2. The Advisory Council's overall views on the consultation
2.1 The Advisory Council welcomes the opportunity to respond to this consultation. It has a particular interest in United Kingdom online publications available free of charge and without access restrictions. The Internet has radically shifted the boundaries between published and unpublished material. The World Wide Web is being increasingly used to disseminate to the public information which would previously have never been cost-effective to publish in printed form. It thus subsumes material which would formerly have been of an archival (unpublished) nature. The Advisory Council therefore supports Government's proposals to pursue a legislative option for the archiving of online publications available free of charge and without access restrictions by means of Statutory Instrument pursuant to the Legal Deposit Libraries Act 2003. The Advisory Council’s response to the consultation questions
3. Question 1: What are your views on the options considered for this content?
3.1 The Advisory Council believes that Option 2, Legal Deposit Libraries Regulation-based Harvesting and Archiving offers the most feasible approach for ensuring that the nation’s published output falling within the category covered by this consultation is collected systematically and as comprehensively as possible. Moreover, Option 2 has scope to support and interface with other UK-based harvesting and archiving programmes.
4. Question 2: Are there any other options that should have been considered? If so what are they?
4.1 Rather than suggest further options, it is agreed that the legal deposit libraries should continue to work closely with other key stakeholders and partners with an active interest in web archiving, so as to share expertise and avoid duplication of effort. These would include other memory institutions such as The National Archives.
5. Question 3: Do you agree with the analysis of these options? Explain why.
5.1 The analysis is sufficiently robust to enable the Advisory Council to recommend Option 2 as the best approach for preserving that proportion of the UK’s web content which is available free of charge and without access restrictions, and within the specified funding constraints of the legal deposit libraries. The Advisory Council considers that Government has demonstrated that Option 2 is the most cost-effective method of archiving the greatest number of websites, whilst also minimizing the burden upon publishers and addressing civil liability issues.
6. Question 4: Do you agree that harvesting provides the most efficient and timely solution for deposit of publications in this category? Explain why.
6.1 The Advisory Council entirely agrees that harvesting provides the most efficient and timely solution for deposit of publications in this category. The Council agrees with LDAP’s analysis that, in the light of the direct experience of the legal deposit libraries thus far, permissions based harvesting (Option 1) would be an ineffective solution on account of difficulties with obtaining permissions and because of the higher cost per unit for publishers and Libraries. The Council agrees that archiving left to the market (Option 3) would not be an effective solution, as indicated by the available evidence. 7. Question 5: Do you agree regulation is the most cost-efficient method of collection for the Libraries and imposes no direct financial or administrative burden upon the publishers? Explain why.
7.1 The Advisory Council agrees that regulation is the most cost-efficient method of collection for the Libraries and imposes no direct financial or administrative burden upon the publishers. Self-evidently this is the case for publishers, since there is no loss of revenue and no administrative burden of active deposit; and the Libraries themselves have estimated they could begin harvesting up to 80% in scale within existing resources and within a very short time of implementation.
8. Question 6: Do you agree that this is an appropriate definition for the type of publications that should be included in scope for regulations? Explain why. Is there anything else that should be included in this definition? Is there anything that should be excluded from this definition?
8.1 The Advisory Council agrees that, within the constraints imposed by Section 1(5) of the Legal Deposit Libraries Act 2003, the definition is appropriate for the type of publications that should be included in scope for regulation. The definition encompasses online publications which are available free of charge and accessible without restriction and which can be collected without any requirement for action by publishers, thus avoiding the majority of administrative complications in their collection.
9. Question 7: Do you agree with the territorial definition of the UK web? Explain why. Is there anything else that should be included in this definition? Is there anything that should be excluded from this definition?
9.1 The Advisory Council agrees with the territorial definition of the UK web because it sets out how the definition may be interpreted in practice and what it includes and excludes. However, although inferred in Annex F, it is not made explicit that this definition has been tested to ensure the automatic capture of content by web crawlers within these parameters.
10. Question 8: Do you agree with the analysis of the UK Web Domain? Explain why. What do you think the impact of your analysis would be?
10.1 The Advisory Council is unable to offer any supplementary or alternative quantitative estimates to those which appear in Annex D. However, it does agree that there may be some grounds for thinking them to be a little on the low side (see our response to Question 15).
11. Question 9: How do you see a Deposit Library driven system of web harvesting interfacing with a publisher driven duty to deposit under the 2003 Act? 11.1 The Advisory Council is of the view that, in order to satisfy the interests of both publishers and legal deposit libraries, the regulation should state clearly that web harvesting does not otherwise absolve publishers of their duty to deposit under the 2003 Act.
12. Question 10: How could Deposit Libraries most efficaciously ensure a comprehensive body of eligible content is deposited?
12.1 The Advisory Council supports a robust system that is at once able to capture content at regular intervals, such as the one mentioned in Annex F, paragraph 8.7; and also to take a pragmatic and selective approach that enables Deposit Libraries to prioritise and target particular websites that are continuously updating their content, so that valuable information is not missed.
13. Question 11: Do you agree with this costing model? Explain why. Are there costs that need to be factored in or excluded?
13.1 While the Advisory Council concurs that the cost of “raw” storage has been declining at 30% per annum and is expected to continue at 25% per annum, the real question is the decline in system costs, the tape libraries and arrays in which the storage resides, software and associated technology solutions. These have not been declining at such a rate. It would have been useful for the legal deposit libraries to have provided their cost ranges and more detailed cost assumptions for hardware and software development and replacement.
13.2 With such high volumes of storage, the Advisory Council considers that data communication costs could potentially become an issue. It is unclear whether these have been included in the cost assumptions. More information about the high-speed networking capability of the legal deposit libraries, both individually and collectively, would have been useful in this context.
13.3 We note (Paragraph 5.13) that “They [the costs] are illustrations of what the libraries believe might realistically be achieved within their budget and resource constraints and after prioritising this activity and category of publications against other collection goals.” We wonder whether there has been any risk assessment by the libraries that the resources have been undersized and therefore undercosted?
13.4 Resource discovery (Paragraph 5.16) we understand to mean locating and accessing publications within the archive. If this is to be delivered by an existing infrastructure, this should be clarified, and there should be an allowance for additional costs to support the additional data.
14. Question 12: Do these assumptions adequately reflect the financial burden of publishers? Is there anything that needs to be included or excluded? 14.1 In general, we consider that these assumptions do adequately reflect the financial burden on publishers, taking into account the results of the LDAP survey which is referred to, and noting that Government intends to address civil liability issues and that no loss of revenue is involved (since the publications concerned are already being made available free of charge and without access restrictions).
14.2 However, there may be a potential short-term impact on the publishers in some cases whilst the actual harvesting is in process. The demand on the websites may impact the publishers’ own expected service levels. This will depend on the volume of data being harvested. More information on this point would have been helpful.
15. Question 13: Do you agree with the analysis of these options? Explain why.
15.1 The Advisory Council agrees with the analysis of the options. See its response to Questions 1 and 2 above.
16. Question 14: Do you agree with the analysis on making content available to the Deposit Libraries? Explain why.
16.1 The Advisory Council agrees that the proposed regulation is necessary in order to preserve and make accessible this significant sub-set of the nation’s published heritage. Additionally, the Council is also of the view that web material should be made available in its original format, as per those web archive collections at the British Library for instance, which are already accessed via the web itself.
17. Question 15: Do you agree with this costing model? Explain why. What else needs to be taken into consideration?
17.1 The cost aspects have been covered above, in our response to Question 11.
17.2 Using figures in paragraphs 5.8 and 5.9, it appears there are three million domain names, as of 2007. This means that each domain has 1.3 publications, on average. This appears to be a rather small ratio.
17.3 The Advisory Council is unsure if the growth of new publications of 15% per annum is a high enough figure.
17.4 While the definitions are clear as to what will be included, translating this into volumes may underestimate the developing multi-media world over the next decade.
17.5 Costs and definitions need to be aligned, especially when this includes high growth publication types.
18. Question 16: Do you agree with the analysis of the costs and the impacts of each option? Explain why. What else needs to be taken into consideration? 18.1 Option 2 becomes more deterministic and offers the fewest barriers to collecting the publications and building the historical record of the country. Our comments on costs are set out in our response to Questions 11 and 12.
19. Question 17: Do you agree with risks identified here? Explain why. Are there other risks that have not been considered? What would their impact be? Are some of these risks actually not really risks? Why?
19.1 The Advisory Council agrees with the risks identified, although it has some difficulty in understanding publishers’ concerns about impact on their revenues of deposit of (and immediate access to) time-sensitive and other types of revenue-generating publications, as this consultation is concerned solely with publications that are made available by publishers free of charge and without access restrictions.
20. Question 18. Do you agree with LDAP’s recommendation to regulate for this content? If not, what should be done instead?
20.1 The Advisory Council agrees with LDAP’s recommendation to regulate for this content. It considers that there is no viable alternative means of creating a core national web archive.
21. Question 19: Do you agree with LDAP’s proposed method for depositing of content? If not how else could this be done?
21.1 The Advisory Council agrees with LDAP’s proposed method for depositing content but it also recognises that other specialist web collections are made available to researchers and members of the public by public sector and other agencies besides the legal deposit libraries. For this reason, it is important that these libraries maintain good relations with these other memory institutions to ensure an optimal approach to the capture and preservation of the nation’s digital heritage.
22. Question 20: Do you agree with LDAP’s analysis of access provisions? Explain why. What other options are there?
22.1 The Advisory Council notes that access to the material will not be provided beyond the physical confines of the legal deposit libraries. We appreciate that this is in line with the provisions of Section 7 of the Legal Deposit Libraries Act 2003. However, researchers and members of the public will doubtless find it ironic and frustrating that content which, prior to archiving, was freely available to anybody throughout the world will now become so restricted.
22.2 The Advisory Council further believes there is a misalignment of policy and practice where it concerns the proposal to allow readers to make printed copies of website material but not download or make electronic copies of any material for non-commercial purposes. Such an approach is restrictive and contrary to the needs of researchers.
23. Question 21: Do you agree with these cost assumptions? Explain why. What needs to be included or excluded?
23.1 The Advisory Council agrees with the cost assumptions subject to the reservations noted above.
Advisory Council on National Records and Archives 1 March 2010
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a554bff32feff9404a9a99c7461584cd015abaf7 | Taking Forward the Gowers Review of Intellectual Property: Second Stage Consultation on Copyright Exceptions
1. Background on the Advisory Council on National Records and Archives
1.1 The function of the Lord Chancellor’s Advisory Council on National Records and Archives is to advise the Lord Chancellor, and through him other ministers as appropriate, on all matters relating to records and archives in the United Kingdom and in particular in England and Wales. It is chaired by the Master of the Rolls.
1.2 The Advisory Council on National Records and Archives embraces two further bodies: the Advisory Council on Public Records, established by s1(2) of the Public Records Act 1958(2), and the Advisory Council on Historical Manuscripts, established by the Lord Chancellor to advise him on matters formerly the responsibility of the Royal Commission on Historical Manuscripts. All three bodies share the same members.
1.3 The terms of reference of the Advisory Council on National Records and Archives are to consider and advise the Lord Chancellor upon:
- Major objectives, programmes and policy changes for The National Archives
- Proposed legislation affecting The National Archives
- The implications for records and public services of any proposed change to the status of The National Archives
- Any subjects brought to its attention by the Lord Chancellor
2. The Advisory Council’s overall views
2.1 Archives form a major part of the information landscape in the United Kingdom and of Government’s information strategy. Government has recently refreshed and restated its strategic objectives for publicly-funded archives in Archives for the 21st Century, which was published in November 2009. This is now proceeding to implementation through The National Archives and the Museums, Libraries and Archives Council (in partnership with CyMAL in Wales). They have just launched Archives for the 21st Century in Action. See http://www.nationalarchives.gov.uk/policy/aft21c/default.htm for further information.
2.2 Archives are not confined to organisations which bear the name of archives. Archival collections will also be found in great abundance in libraries and in museums and galleries. The concern of the Advisory Council is with archives in this widest sense, not simply with the content of designated archival repositories. Likewise, beyond The National Archives, the Advisory Council seeks to take into account the interests of archivists and archive managers, the users of archives and the owners/depositors of archives.
2.3 Archives are of a very diverse nature and comprise material in every medium which has ever been used for the recording and transmission of information, including audio-visual and digital formats. Although they mostly constitute unpublished sources, many archives also incorporate published documents. The distinction between what is published and what is unpublished is being rapidly eroded in the digital age. Therefore, every dimension of archival collections is touched by copyright issues in some shape or form, including the unexpired transitional protection for works which were unpublished at the time of the passage of the Copyright Designs and Patents Act 1988.
2.4 The Advisory Council considers that, in several important respects, the Copyright Designs and Patents Act 1988 now lags behind the changes in the information environment which have occurred during the intervening two decades. Accordingly, it recognises the need for copyright reform as set out in the evidence and recommendations of the Gowers Review. It welcomes the steps which Government is taking to consider those recommendations in depth and to proceed to implement them, where appropriate, through legislative change. The Advisory Council understands that this is a complex process, with a need not simply to balance the interests of rightsholders and users but to adhere to obligations set down in European and other international copyright frameworks.
2.5 The Advisory Council believes that copyright exceptions are fundamental to the preservation and dissemination of archival content. It has concerns with the current copyright regime in two respects: undue complexity and anomalies/inconsistencies. For the regime to be effective in practice, and understood and observed by archivists and archival users, it needs to be simplified and harmonised wherever possible. Copyright exceptions should also, in our view, be format-blind. An exception, once granted, should be applicable to all formats of information, and not just some. These are the two litmus tests which we have used to evaluate the Government’s proposals as set out in the Second Stage Consultation.
2.6 With regard to Gowers Recommendation 9: Research and Private Study, the Advisory Council fully supports the expansion of the fair dealing exception in s29 to cover sound recordings, films and broadcasts and the extension of s43 to include unpublished artistic works. However, we wish to register serious reservations about the proposed restriction of fair dealing (and of copying by libraries and archives) to members of educational establishments in respect of sound recordings, films and broadcasts.
2.7 With regard to Gowers Recommendations 10A/10B: Libraries and Archives, the Advisory Council welcomes Government proposals to expand the exception for preservation copying to all classes of work, to permit format shifting, and to enable museums and galleries to benefit from the provisions. We believe that any definition of ‘permanent collection’ should be subjective, and we highlight a particular issue with image libraries. We are disappointed by the Government’s unwillingness to change current arrangements in respect of digital rights management, since this may act as an effective break on appropriate preservation copying in certain circumstances, thereby limiting the benefit of the extended exception.
2.8 The Advisory Council has no particular opinion to express about the third of the Gowers Recommendations which is the subject of this Second Stage Consultation, relating to Educational Exceptions. These impact less directly upon the world of archives, not least since Government has indicated that it does not intend to broaden the definition of an educational establishment to include libraries, archives and museums (p. 12, paragraph 70). As it stands, therefore, this recommendation falls somewhat outside the scope of the Advisory Council’s work. 3. Advisory Council’s response to Gowers Recommendation 9: Research and Private Study
3.1 The Advisory Council welcomes the expansion of the fair dealing exception in s29 to cover sound recordings, films and broadcasts, in addition to the literary, dramatic, musical and artistic works to which it already applies (p. 28, paragraph 187; p. 30, paragraph 201). The Council also supports Government’s decision not to differentiate between non-commercial research and private study (p. 29, paragraph 195); not to limit the extended exception to specific purposes or subjects (p. 30, paragraph 206); and not to prescribe the amount of a work that may be copied, nor to define fair dealing (p. 32, paragraph 220).
3.2 However, the Advisory Council is extremely concerned that the expanded exception for fair dealing in respect of sound recordings, films and broadcasts is to be limited to ‘members of an educational establishment’, with the requirement that ‘copying must be for the purposes of a course of study or research being undertaken at that establishment’ (p. 28, paragraph 187; p. 29, paragraph 196; p. 31, paragraph 217). We note with regret that this restriction is to be embedded in an amended library declaration form (p. 33, paragraph 232).
3.3 This limitation is at odds with fair dealing in respect of literary, dramatic, musical and artistic works where non-commercial research and private study are not, and will not be (p. 31, paragraph 217), confined to any particular class of researchers or students. Not only does this fail the Advisory Council’s anomaly and complexity tests, since yet another inconsistency is being introduced into copyright law (with scope for consequential confusion), but we see no convincing empirical evidence being brought forward for such a restriction. So far as we are aware, there is no material proof that the principle of fair dealing has hitherto compromised the economic interests of rightsholders. We note that there is no such requirement in Article 5(3)(a) of the Information Society Directive, nor is it implicit in the Three Step Test.
3.4 Furthermore, this limitation would appear to contradict other elements of Government policy, both the generic encouragement to pursue informal and lifelong learning, and (in our particular context) the desire to see archives opened up and utilised by the widest possible constituency (as reflected in the Government’s strategy for publicly-funded archives). All forms of archives, but especially those managed by local authorities, are heavily used by informal learners and independent scholars, many of whom go on to publish the outcomes of their research, thereby adding to the collective understanding of our national and local history and cultural heritage.
3.5 Should this restriction be implemented, archives and other information organisations, whether located in educational establishments or not, will be required to differentiate between two groups of users, those who are members of educational establishments and those who are not, and to offer them a different level of service. This will be seen as discriminatory and will also be very hard to police. Certainly, it will be difficult, if not impossible, for librarians and archivists to validate the additional information about educational establishment which is being sought on the new declaration forms. As with the present declaration forms, they will simply have to accept it at face value, unless they have immediate reason to doubt its veracity. 3.6 The potentially detrimental effect of this limitation on archives is further compounded by Government’s unwillingness to designate libraries, archives and museums and galleries as educational establishments (p. 12, paragraph 70).
3.7 If Government’s principal concern in proposing this limitation is to prevent fair dealing in sound recordings, films and broadcasts from being applied for the purposes of entertainment, then the restriction to members of educational establishments seems a peculiarly blunt instrument for achieving this end. The problem surely lies in the fact that, unlike many European Union countries, the United Kingdom has failed to implement a private copying exception. For this if for no other reason, the Advisory Council considers it unfortunate that, in this Second Stage Consultation, Government has announced that it does not intend to proceed with such a private copying exception (p. 25, paragraph 171).
3.8 In respect of copying by libraries and archives, the Advisory Council likewise approves in principle the new s39A and s43A, which are designed to enable librarians and archivists to make copies of, respectively, published and unpublished sound recordings and films (p. 30, paragraph 202; p. 32, paragraph 226). However, as with fair dealing, we do not support the limitation of the making of such copies for the benefit solely of members of educational establishments, and for exactly the same reasons.
3.9 The extension of s43 to include unpublished artistic works removes an obvious anomaly (p. 33, paragraph 228) and is to be welcomed. There remain unresolved issues with s39 in that the copying of published copyright works is restricted to librarians, whereas such works may also exist in archives; and with s43 where, strictly speaking, the copying of a manuscript which has later been published is not permitted. The Advisory Council does not believe that it was the intention of Parliament to prevent either act and thus hopes that Government may be willing to contemplate some amendment of these sections, in respect of these two particulars, also.
3.10 In answer to the specific questions posed in Annex B, paragraphs 1-3:
- We are not aware of any consequences which would render impractical the application of s29(3) to all works (paragraph 1)
- We are not aware that there is any legal justification for clarifying that legitimately acquired copies would be infringing copies if subsequently dealt with, since the matter seems to be adequately covered in the 1988 Act (paragraph 2)
- We do not support the restriction of the expanded exception to members of educational establishments (paragraph 3)
4. Advisory Council’s response to Gowers Recommendations 10A and 10B: Libraries and Archives
4.1 The Advisory Council supports many elements of the Government’s proposals for the amendment of s42 which will enable better preservation of the national documentary heritage, not least of those materials in audio-visual and digital formats. In particular, the Council welcomes the expansion of the exception: to cover all classes of work, including artistic works, films and sound recordings, in addition to other works which are already covered (p. 37, paragraphs 267 and 269); to permit format shifting, with no numerical limitation on the number of copies (p. 37, paragraph 267; p. 38, paragraph 272); and to cover museums and galleries as well as libraries and archives (p. 39, paragraph 278).
4.2 We note that the extended exception will apply, as for classes of work which are already covered by it, to items which form part of the permanent collection of the relevant library, archive or museum or gallery and where it is not reasonably practicable to purchase a replacement copy (p. 37, paragraph 269; p. 39, paragraph 279). Archives are largely concerned with unpublished or otherwise unique material, and thus the question of the purchase of a replacement from a commercial source would rarely arise. Following accessioning, initial sorting and any scheduled review, it is also unusual for archives (as opposed to modern records centres) to dispose of collections (other than in the case of material on deposit and in the legal ownership of a third party, which could theoretically be recalled by that third party). Thus, the very essence of archives is that they comprise permanent collections, and this would be our principal response to the definitional question posed in Annex B, paragraph 12.
4.3 Notwithstanding this generic position, there is one particular area of archives where there may be some ambiguity about what constitutes a permanent collection. This concerns non-commercial image libraries comprising photographic copies – legitimately acquired – of works held in the permanent collections of other institutions, public or private. Such image libraries constitute a significant research and study resource in their own right and are properly regarded as part of the permanent collection of the library, archive or museum and gallery where they are held, even though the original works which they copy form part of the permanent collections of other institutions. In some cases, the original works may have subsequently disappeared (either entirely or from public view), and the copy constitutes the only publicly-accessible record. Many of these copies were made a long time ago, by non-digital techniques, and the resultant photographs fade over time or otherwise degrade. They thus require appropriate preservation and conservation treatment, which may include preservation copying. Accordingly, any definition of ‘permanent collection’ which is adopted by Government, should one be judged necessary, should be of the subjective kind, as set out in Annex B, paragraph 12(a), leaving the judgment to the authority responsible for the running of the relevant collection. This would address the issue of image libraries.
4.4 Meanwhile, with regard to image libraries, the Advisory Council’s reading of the substituted wording for s42 in Annex A, paragraph 18 is that preservation copying of photographic copies which form part of a permanent collection would not be prohibited since, although they may be copies of an item in the permanent collection of other libraries, archives, museums and galleries, those copies were not made for the purpose specified in subsection 2(c), i.e. replacement of an item which has been lost, destroyed or damaged. The Advisory Council would be pleased to receive confirmation from the Intellectual Property Office that our understanding is correct.
4.5 The Advisory Council has some concerns about paragraph 288 (p. 40), signalling Government’s reluctance to change the current arrangements with regard to digital rights management (DRM), in cases where technical protection measures may constrain the practical implementation of the extended exception, thereby rendering it inoperable. Like many information-related organisations, the Advisory Council considers that the current system of a notice of complaint to the Secretary of State is inadequate, and that DRM-workarounds should be allowed, at least for a limited number of ‘trusted intermediaries’, to enable preservation copying to take place with the minimum of inconvenience. However, the Advisory Council takes note of Government’s ongoing work in what we accept is a complex area. 4.6 In answer to those specific questions posed in Annex B, paragraphs 10-17 on which the Advisory Council has a view:
- The Advisory Council considers it to be the right approach not to restrict the number of preservation copies, not least since digital preservation is still in its relative infancy (paragraph 10)
- Libraries, archives, museums and galleries are not mutually exclusive and should not be treated as such – certainly, archival content will be found in them all (paragraph 11)
- Permanent collections should be subjectively defined and will increasingly include digital material that may not necessarily be held on a server located on the premises, or even under the direct control, of the archive concerned (paragraph 12)
- We consider that the proposed wording of s42(3) makes clear that what is being preserved is the content rather than the object (paragraph 14)
- We believe that the wording of the proposed amendments does meet the stated objectives (paragraph 15)
- We do not particularly foresee that the proposed amended definition of ‘publication’ will have undesirable consequences (paragraph 16)
- Statutory Instrument 1989/1212 will need to be brought into line with the proposed legislative changes (paragraph 17)
Advisory Council on National Records and Archives 31 March 2010
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bf9c440226d177d2b0380b0404f472b1d5b9e7c7 | 1. What is the Advisory Council on National Records and Archives?
The Advisory Council is an independent, advisory non-departmental public body that provides advice to the Secretary of State for Digital, Culture, Media and Sport and to other Government Departments on issues relating to access to public records. It was established by the Public Records Act in 1958.
2. What does the Advisory Council do?
The Council has four main roles:
- It advises the Secretary of State on issues relating to historical public records that have been selected by government departments for permanent preservation and transfer to The National Archives when the records become 20 years old, including public access to these documents.
- It advises the Secretary of State on requests from government departments to retain historical documents for administrative or security reasons, under the Public Records Act.
- It advises on the public interest when departments want to keep historical public records closed under Freedom of Information Act exemptions. It challenges departments to provide evidence to justify the continuation of such closures.
- Through its sub-committee, the Forum on Historical Manuscripts and Academic Research, it advises the Chief Executive and Keeper of The National Archives in his role as Historical Manuscripts Commissioner under a Royal Warrant of 1869 on issues relating to independent archives. It also advises on strategies and policies which provide leadership for the archive sector.
The Advisory Council also supports government departments and The National Archives by providing independent advice and scrutiny on issues relating to records managements and archives. It meets four times a year, but there is frequent activity between meetings, with groups of members forming special panels to consider requests under the Freedom of Information Act for the release of documents held by The National Archives or kept within government departments. 3. Who is on the Advisory Council?
The Council typically has up to 18 members drawn from the public, private and third sectors, including historians and academics, archivists and information management specialists, and former civil and public servants, journalists and diplomats. Members are appointed because they have knowledge and expertise relevant to the Council’s work, which will help it evaluate departmental responses about the sensitivity of particular records. Historians, for instance, may be able to use their knowledge to place a record in its historical context and to confirm what is already in the public domain. A former civil servant, with first-hand experience of working in government, is well-placed to identify when a department is being unnecessarily cautious in seeking to keep a document closed. Members have to declare any potential conflict of interests in a published register, and do not take part in the consideration of any applications where they have a direct interest.
4. How do you become a member of the Council?
Anyone can apply. Appointments for three-year terms are publicly advertised. The process is regulated by the Commissioner for Public Appointments whose Code of Practice sets out three principles which govern appointments – merit, fairness and openness. Final appointments are made by the Secretary of State for Digital, Culture, Media and Sport.
5. Who chairs the Advisory Council?
The Advisory Council is chaired by the Master of the Rolls, currently Sir Terence Etherton. He is the second ranking judge in England and Wales and one of the most senior in the UK. The holder of the office, which dates back to at least the 13th century, was originally responsible for the safe-keeping of charters, patents and records of important court judgments written on parchment rolls. He still has responsibility for documents of national importance, as chairman of the Advisory Council. The Master of the Rolls was the nominal head of the Public Record Office, which preceded The National Archives, and has headed the Advisory Council since it was created by the Public Records Act. The Master of the Rolls is now supported by two members who act as his deputies, one for the Council and one for the Forum on Historical Manuscripts and Academic Research.
6. How independent are you?
The Council is an advisory body of the Department for Digital, Culture, Media and Sport, and its members (though not civil servants) are appointed by that department’s Secretary of State. But their decisions are taken, and recommendations made without reference to government, and without fear or favour. Members regularly challenge government departments on why documents remain classified or other reasons given for not handing them over to The National Archives, or on a department’s unwillingness to reveal information in response to Freedom of Information requests, or taking too long in carrying out their responsibilities handling important and historical documents. Like other bodies of a similar size or type, it receives support, including secretariat support from a government department – in this case, The National Archives, based in Kew. But the Advisory Council is not part of The National Archives, and its chief executive attends meetings of the Council ex officio, usually reporting on latest developments and answering questions, with his staff, from Council members.
7. What sorts of applications does the Advisory Council consider?
There are two types:
- **Closure applications** (‘closure at transfer’) are made when a government department wants to keep closed historical information contained in records being transferred to The National Archives, because of provisions (called exemptions) in the Freedom of Information Act - for instance, relating to the safety of individuals or national security.
- **Retention applications** are made when a department wishes or is required to retain any record which, because of its age, would otherwise be due for transfer to The National Archives or, if not selected for permanent preservation, for destruction. The Advisory Council then advises the Secretary of State for Digital, Culture, Media and Sport on whether to agree. This can happen when, for instance, there is a business need to keep files, perhaps in relation to continuing commercial contracts or, for example, because they are relevant to compliance with health and safety legislation. Other reasons for retention applications are review backlogs, as a result of which decisions on permanent preservation and/or on any continuing sensitivity remain to be taken, and security considerations. The National Archives does not accept records the security classification of which remains at or above Secret, so departments must apply for authority to retain any such records before they exceed the age of 20 years.
8. How many records does the Council consider?
It is important to realise that the vast majority of documents selected for permanent preservation are transferred fully ‘open’ to The National Archives and can be viewed by anyone – over 95% in 2016/17. In only a very small proportion of cases do departments ask for files, or parts of files, to be kept closed. This is very often because they contain personal information or material which could be harmful to individuals, for instance family members of murder victims. Information that could harm national security or damage the national interest is either retained by the department that owns it or transferred closed to The National Archives if its security classification so allows. In 2016-17, council members considered 4,290 closure applications and 986 retention applications. The number queried has seen a big rise in the last two years – to 506 closure applications and 116 retention applications. The number then amended or withdrawn has more than tripled from 83 to 264 in just two years. It is not feasible to scrutinise tens of thousands of often lengthy individual records, but departments wishing to retain records or keep them closed have to provide a summary of their contents and an explanation of why they should be retained or closed. Departments do heed the views of the Advisory Council, and when members are unconvinced of the sensitivity of a document, they can ask to see it.
9. What is your role with Freedom of Information requests?
Records retained by departments and those closed when they are transferred to The National Archives are still subject to the Freedom of Information Act and anyone can make a request to see them. When so-called “qualified exemptions” are being used to keep documents closed the Advisory Council, acting on behalf of the Secretary of State, has a right to be consulted, and is required to carry out a “public interest test”. A panel of three Council members is convened to consider whether it is in the public interest to release the information, or keep it closed. Examples include when a document contains information which could cause harm to individuals, or material that could damage national security, criminal investigations, or Britain’s international relations. These panels considered 400 cases in 2016/17, almost half as many again as in the previous year.
10. Why aren’t your meetings in public?
Most of the information the Advisory Council considers is sensitive. It needs to know why, and to be able to challenge departments who attend its meetings, and freely discuss how a case should be handled. If meetings were public, the Council would not be able to do its job in independently scrutinising closure and retention applications. A summary of meetings is published on its website, and the Council publishes an annual report with details of its work.
11. What is the Forum on Historical Manuscripts and Academic Research?
The Forum is a subcommittee of the Advisory Council. It is made up of Council members, as well as external representatives appointed for their knowledge and experience of historical records.
It was set up in 2010 to enable recommendations to be made to the Advisory Council about activity relating specifically to historical manuscripts (independent archives), and a place for discussion about academic research issues. It considers and provides advice on matters relating to manuscripts, records and archives, other than the public records, and in particular:
- the location, collection, care, custody, preservation, acquisition, sale and use in all formats of such documents • the compilation and dissemination of information about them • any questions affecting such documents as may be referred for its consideration, including issues relating to the statutory duties of the Master of the Rolls in respect of manorial and tithe documents, and the making of recommendations to appropriate ministers on the allocation of archives and manuscripts accepted for the nation in lieu of tax • other issues that would formerly have come within the terms of reference of the Royal Commission on Historical Manuscripts.
The Forum acts as a vehicle for the development of constructive and collaborative engagement between The National Archives and its academic stakeholders, sharing knowledge and developing trust and understanding. The Forum will also provide an open, independent and authoritative advisory voice to The National Archives, to support research and academic liaison there.
12. Independent Archives
The Forum on Historical Manuscripts and Academic Research advises The National Archives on strategies and policies for locating, documenting and caring for private archives. This includes the provision of advice relating to the acceptance of manuscripts in lieu of tax. This function supports the responsibilities discharged by the Historical Manuscripts Commissioner under the Historical Manuscripts Commission’s Royal Warrant of 1869.
October 2017
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1fa81fea5815f2c3fbcb87d9c2294c18474e3418 | Advisory Council on National Records and Archives
Status, Structure, Role and Functions
This explanatory note on the Council and its work should be read in conjunction with the Council’s Terms of Reference (‘TOR’), which it supplements. The TOR are published together with this note on the Council’s website.
The Status of the Council
The Advisory Council on National Records and Archives (the ‘Council’) is an advisory Non Departmental Public Body (‘NDPB’) which performs statutory functions under the terms of the Public Records Act 1958 (the ‘PRA’) and the Freedom of Information Act 2000 (‘FOIA’), relating to public records. It also performs certain functions in respect of independent archives, advising the Historical Manuscripts Commissioner (as appointed under the terms of the 2003 revision of a Royal Warrant of 1869, which first established the Historical Manuscripts Commission).
When discharging responsibilities for public records¹ and other kinds of historical records, archives and manuscripts, the Secretary of State for Digital, Culture, Media and Sport takes independent advice from the Council, which speaks to the government on these issues on behalf of the general public.
The Council has no executive functions or powers. As an advisory NDPB, it falls within the remits of the Parliamentary Commissioner for Administration (the ‘Parliamentary and Health Service Ombudsman’) and the Commissioner for Public Appointments.
The structure and membership of the Council
The Council was created in 2003 and encompasses two previously-established bodies, the Advisory Council on Public Records and the Advisory Council on Historical Manuscripts. Since then, these two bodies have functioned as one and now advise the Secretary of State for Digital, Culture, Media and Sport.
The Advisory Council on Historical Manuscripts was turned into a subcommittee of the Advisory Council on National Records and Archives in 2010, to provide a means through which recommendations can be made to the Council about activity relating specifically to historical manuscripts (independent archives), as well as a place for discussion about academic research issues. The subcommittee is known as the Forum on Historical Manuscripts and Academic Research (the ‘Forum’).
¹ Public records, as defined in the Public Records Act 1958, are the records of central government and the central courts of law and related organisations and bodies. The Council is chaired by the Master of the Rolls. The Master of the Rolls is a judge of the Court of Appeal of England and Wales and is the President of its Civil Division, second in judicial importance to the Lord Chief Justice. The Master of the Rolls is the statutory custodian of the records of the Chancery of England and has the statutory charge and superintendence of manorial records. The current Master of the Rolls is Sir Terence Etherton.
The Council’s members are appointed by the Secretary of State, by public appointment. They come from a wide range of fields, including users of historical records, such as historians and journalists; retired senior public, civil and diplomatic servants and professionals with relevant information expertise, including but not limited to archivists, compliance practitioners, digital curators, lawyers and records managers.
**The Council’s Role and Functions**
The Council’s statutory and other main duties are set out in its TOR. The Council has a particular statutory responsibility to advise the Secretary of State on matters relating to public records, including preservation and public access to them, and the facilities provided for the public at The National Archives. The Council’s statutory responsibilities concerning access to historical public records were augmented by the FOIA, which sets them out in more detail.
In addition, the Council advises the Secretary of State on major strategic archival policy matters and matters relating to the preservation of and public access to local authority, business and independent records, and archives and manuscripts in archival repositories and in private hands.
The Council advises the Historical Manuscripts Commissioner on matters relating to non-public records. As specified in its TOR, it does so principally through its sub-committee, the Forum.
The National Archives is responsible for the public records of the United Kingdom government and the Council’s remit in relation to public records is the same.
The remit of the Historical Manuscripts Commission and of the Council in relation to non-public records extends to the whole of the United Kingdom, without prejudice to the special responsibilities of the Keeper of the Records of Scotland and the Deputy Keeper of the Records of Northern Ireland. The Council therefore seeks to have representation from all parts of the United Kingdom. The National Archives of Scotland and the Public Record Office of Northern Ireland are responsible for records of Scotland and Northern Ireland respectively; the Welsh Assembly has yet to establish a Welsh national archives or a comparable advisory body.
As agreed with the Secretary of State, the Council receives support for its work from The National Archives (which meets the costs of the Council’s meetings, including the travel expenses incurred by its members) and the Secretary to the Council is an employee of The National Archives. However, the Council is entirely independent of The National Archives and the two bodies function independently. The Council has no role in the day-to-day running of The National Archives and no authority over its Chief Executive, either in that capacity, or as Keeper/Historical Manuscripts Commissioner. The Chief Executive attends meetings of the Council *ex officio.* Additional information on the work of the Council
Access to public records:
The greater part of the Council’s time is spent on work relating to access to public records. The statutory basis for this work is the PRA and the FOIA.
Under the FOIA, the Council is responsible for advising the Secretary of State on the application of the FOIA to historical public records (those over 20 years old). In particular, this involves acting on behalf of the Secretary of State in advising government departments in relation to the release or non-disclosure of particular records.
The Council advises on the balance of the public interest in relation to applications from departments for the extended closure of historical public records and other ‘matters relating to the application of [FOIA] to information contained in public records that are historical records within the meaning of Part VI of that Act’;
The Council advises on the balance of the public interest in the release or non-disclosure of historical records, an application for the disclosure of which has been made under the FOIA.
The Council also advises the Secretary of State in relation to his or her responsibility under the PRA to examine applications from departments for the retention(^2) within those departments of public records beyond the age of 20 years, when those selected for permanent preservation are normally transferred to The National Archives. The Secretary of State is always advised by the Council before signing a retention instrument.
The Council scrutinises closely the arguments advanced for the use of qualified FOIA exemptions and for retentions, and departments are often asked to reconsider their proposals. This can lead to a record being made available after all. If the Council considers it necessary, it may ask the Master of the Rolls to nominate a member to request access to documents and make recommendations. Typically, the Council examines some 4000 applications for closure under FOIA exemptions and around 1000 applications for retention, each year.
Where the Council is advising on the balance of the public interest in the release or non-disclosure of historical records in response to an application made under the FOIA, it may do so outside full Council meetings. Typically, panels of three Council Members will review, consult, and report their conclusions to the Council Secretary on behalf of the whole Council. Reports on the conclusions of such panels are presented to the next meeting, when cases with particular significance for the
(^2) ‘Retention’ is the process under which government departments and other records-creating bodies may retain records themselves rather than transfer them to The National Archives. The Public Records Act 1958 s3(4) provides that records may be retained with the approval of the Secretary of State for Digital, Culture, Media and Sport. He issues ‘instruments’ authorising retention, which may be in two forms: normal instruments identify particular documents or parts of documents, while blanket instruments identify whole classes of documents. Where only part of a document is retained that part is said to have been ‘redacted’. Council’s work may be discussed. Panels are convened as often as is necessary to deal with the volume of access requests under the FOIA for historical public records.
Other main responsibilities of the Council:
As set out in its TOR, the Council’s responsibilities cover a wide range of matters, concerned with representing the interests of the public in records issues of all kinds, and with records both public and private.
Subjects considered by the Council include, for example:
- public services provided by the National Archives and other UK archives;
- preservation policy for records and manuscripts of all sorts, including the criteria governing the selection of public records for permanent preservation (but not the application of the criteria to particular records, for which the Keeper is responsible);
- the impact on records and archives of new legislation;
- the sale and export of historical manuscripts;
- the level and fairness of fees.
Acting on behalf of the Council, the Forum considers policy proposals relating to non-public records, and has a particular interest in ensuring the preservation of independent collections of manuscripts for the benefit of both owners and the public in all of the above matters. The Forum advises on action in support of the maintenance and care of historical manuscripts held in private hands. It also gives advice on research to advance the field of archives and information management, as well as to underpin and support the use of archives.
Reporting
The Council reports to the Secretary of State every year in an annual report by the Master of the Rolls, which is published with the Annual Report of The National Archives, although the Master of the Rolls may approach the Secretary of State at other times when required.
Last update: October 2017
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7195d8e1b98411e482e0b886e1fdfe413d6767ae | 1. Welcome, introductions, apologies and declarations of conflicts of interest
1.1 The Chair welcomed the attendees.
1.2 There were apologies from Ms Lesley Ferguson, Dr Helen Forde and Lady Moira Andrews.
1.3 The Chair introduced and welcomed Sam Allan who had recently joined his office as his Private Secretary.
1.4 The Chair also introduced and welcomed Ms Lesley Cowley, a non-executive director of TNA, who was attending the meeting as an observer.
1.5 The Chair asked members to declare any conflicts of interest which they had identified in relation to the business of the meeting. The following recusals apply: 1.5.1 Ms Liz Copper is an employee of the BBC, so will not comment on BBC matters.
1.5.2 Mr Michael Smyth is unable to comment on matters relating to the Chagos Islands and Diego Garcia.
2. Minutes and matters arising
2.1 The minutes of the November meeting had been circulated and agreed as an accurate record prior to the session. No further amendments were made.
2.2 Summary minutes were also agreed prior to the meeting.
2.3 Matters Arising
Action Log Review:
The Chair went through the Action Log and noted progress on the various open actions.
The Secretary explained that there had been a slight alteration to the numbering system on the action log, so action numbers are now prefixed by a reference to the year in which they were first raised. Actions for 2019 are therefore being recorded as “19/1”, “19/2” etc.
Actions 18/18 and 18/22. The Chair noted that the meeting with the Secretary of State on 22 January, which Lord Ashton had also attended, had gone well.
He explained that he had stressed the constitutional role of the Council, which makes it different to many other advisory bodies.
Another key item on the meeting agenda was recruitment. The Chair had explained that the need to start a recruitment process was now urgent, as the current numbers deficit had the potential to harm the effectiveness of the Council.
Remuneration was also discussed at the meeting.
Other issues, such as absolute exemptions and the Code of Practice review, also came up at the meeting. The Chair is writing a follow-up letter which confirms what was discussed, which should be despatched shortly (see Actions 19/1 and 19/2).
The Deputy Chair noted that the Council recognised as long ago as 2017 that it would be sensible to have a delegation in place, which makes it clear that is properly empowered to carry out public interest tests in relation to qualified exemptions under Section 66 of FOIA on behalf of the Secretary of State. It would be sensible if this were picked up in the follow-up letter to the Secretary of State. The Deputy Chair shall provide a paragraph to this effect.
ACTION: the Deputy Chair to provide a paragraph on the delegation issue to the Chair for inclusion in his letter to the Secretary of State.
The Chair noted that he would like to meet with the Secretary of State at least once a year. The Secretary shall facilitate this.
ACTION: the Secretary to institute a process whereby a meeting between the Secretary of State and the Chair is scheduled at least once annually.
The Secretary noted in relation to Action 29 (potential invitation to non-executive directors) that one of the DCMS directors had expressed an interest in attending the November session. Members noted that the action related to other departments and not just DCMS, as the invitations were intended to help raise awareness of the Council’s role and functions. They therefore asked that other departments’ directors be invited in the meantime, perhaps starting with the FCO as so many applications for closure originate from that department. The CEO of TNA agreed to do this.
**ACTION:** TNA to invite other departments’ directors to Council meetings, as observers, to raise awareness of the Council’s work.
On **Actions 18/22 and 18/91** (re: the proposed new procedure under section 65 of FOIA) it was noted that the new process may lead to a greater requirement for members to be security cleared (as, by their nature, retained records are more likely to be sensitive). This was picked up again in relation to Action 18/92 below.
On the Section 65 point, it was agreed that the Council was prepared in principle to take on the extra responsibility.
Outside the meeting, TNA took an **ACTION** to start considering how the new Section 65 process might work practically.
On **Action 18/92**, it was noted that a requirement for security clearance in the recruitment process might put off potential new members (although the current draft advertisement does not say that it is a mandatory requirement). The risk was noted and it was agreed that the wording of the draft advertisement should be reviewed and, if necessary, clarified to make it clear that the level of clearance sought will not require an onerous nor an intrusive process.
**ACTION:** the Secretary to review the draft recruitment advertisement and, if necessary, provide clarification of the clearance wording.
### 3. Access to Records
3.1 There were no further recusals.
3.2 The Council formally approved the acceptance of schedules seen outside the meeting, with the exception of any queries which were brought to the meeting.
**General Points**
3.3 None.
**Outstanding Queries**
**Paper 3.1 Queries outstanding from remote schedule**
3.4 The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments.
**Paper 3.2 – Queries on Closure and Retention Schedules (November 2018)**
**General:**
3.5 The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments, as more fully described in the attached annex to these minutes. 3.6 The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments, subject to certain exceptions, which were either queried, withdrawn or carried over, as the relevant department had yet to respond, all as noted in the annex to these minutes.
General
3.7 A schedule of closure applications, together with a schedule of retention applications, was sent to members prior to the meeting. Members were asked to raise any queries within 10 days.
3.8 The Senior Access Manager collated the queries and a list of them was circulated with the papers for this meeting, with responses being provided where possible.
3.9 At the meeting, members were asked if they were content with the responses provided, whether in written form or orally. Where a response had not been provided, or members remained unhappy, the queries were carried forward.
4. Departmental Retention Requests
The Council considered papers from the following departments relating to the retention of records:
- Charity Commission
- Companies House
- Animal and Plant Health Agency
- Cabinet Office (2 papers)
Retentions were requested for between one and four years.
In addition, the following departments had provided updates, further to requests from members made at previous meeting:
- Foreign and Commonwealth Office
- Cabinet Office (1 paper)
- Ministry of Justice
- Department for Education
- Attorney General’s Office
- Her Majesty’s Revenue and Customs
- Ministry of Defence
The Secretary will notify the relevant departmental contacts of these outcomes following the meeting.
**ACTION:** the Secretary to write to departments to notify them of the Council’s recommendations, including any which will go forward to the Secretary of State with regard to retention requests.
One paper mentioned a template which the department is using in its work and members expressed an interest in seeing this. Members also expressed an interest in receiving more information from the department on its processes and procedures for dealing with the digital challenge (including the template mentioned above), perhaps at the September training session.
**ACTION:** The Secretary to invite the department to the September training session to talk about its approach to the challenges of digital records. Members would also like sight of the process template used. During the discussions, Members expressed an interest in the criteria for destruction. TNA explained that these will be set out in Operational Selection Policies (“OSP”s). Members asked for sight of these.
**ACTION:** TNA to share copies of relevant OSPs with members, for information.
5. **Administrative Matters**
**Item 5.1.1 – Code of Practice Review**
Ms Fletcher provided an update on this item. A Steering Committee meeting has been held and the intention now is to accelerate the programme of work, following completion of the initial engagement phase. The first draft is due in the summer. The process is likely to take 18 months to complete, in total.
**Paper 5.1.2 – Draft Annual Report – Verbal Update**
This was presented for information and discussion.
The Annual Report is published in July as an annex to the TNA Annual Report. Members were invited to feed their initial comments on the draft to the Secretary within the following three weeks. The intention then would be for an updated draft to be circulated for further refinement, so that the report is in “nearly final” form for the May Council meeting.
The Chair said that he would like to emphasise the statutory role of the Council in the report and its role in relation to public access.
Members agreed that the Annual Report should set out a positive view of what the Council had achieved over the course of the last year. The media sub-committee, in particular, should therefore be consulted in the drafting process.
**ACTION:** members to feed comments on the Annual Report to the Secretary, who will collate them; will liaise with the Deputy Chair and the media sub-committee and will be responsible for version control.
**Item 5.1.3 – Website Updates – Verbal Update**
The Secretary noted that some updates had been made to the website, particularly in the membership and roles and responsibilities areas. However, members’ views on other possible updates and improvements would be welcomed.
**ACTION:** members to review the website and provide feedback on it to the Secretary.
**Item 5.1.4 – Appraisals – Verbal Update**
The Secretary noted that the forms (which are more of a quantitative than a qualitative assessment) are nearly ready and will be circulated shortly. Members will be invited to add their comments to their own forms and the final versions will be signed off by the Chair.
**ACTION:** a completed appraisal form to be circulated to each member for comment. Paper 5.1.5 – Register of Interests
A new form had been circulated with the meeting papers. Members were asked to complete this and to return it to the Secretary, who keeps the register.
**ACTION:** members to return completed register of interest forms to the Secretary.
Paper 5.1.6 - Review/ Audit Process
The Secretary noted that a review session had been arranged for 10 April, with 3 members taking part. These members had requested a total of 10 transferred files to review. It appears, however, that 3 of these files are unavailable to order. Members queried this (as files from February and May 2018 had deliberately been selected, to allow time for transfer). TNA explained that there were a number of reasons for the delay. Members agreed that it would be sensible to request alternative files to review on the day but thought that the original files should be tracked, so that they could be subject to audit when they are finally accessioned.
The Chair noted that he would welcome more information on the TNA accession process. TNA agreed to provide this, perhaps in a slot at the September training session.
**ACTION:** TNA to provide further information on the TNA accessions process (perhaps in the form of a “lifecycle of a file” presentation) in a session at the September training day.
6. Forum Update
6.1 The new Deputy Chair of the Forum presented her update. She noted that she had already has a useful preliminary meeting with TNA colleagues.
6.2 Her early priorities include digitisation and GDPR-related matters. The former is likely to have an effect on consideration of acceptance in lieu cases, given the lack of a current market for digital items. She also gave a brief summary of some of the matters which were raised at the last Forum meeting, including in respect of local archives and the planned HM 150 celebrations. Finally, she noted that she would like to see increased engagement with the academic community.
6.3 The Chair noted that digitisation was a recurrent theme of interest to members. It was therefore agreed that it would be useful to have a session on digital issues at the September training day.
**ACTION:** a slot on current digital-related issues should be added to the agenda for the September training day and separately to the next Forum meeting agenda.
7. TNA Strategy Update – Item 7
7.1 TNA’s Head of Strategy presented some slides on the new TNA strategy, which is currently with DCMS ministers for approval. There has been extensive consultation on this.
7.2 The strategy acknowledges both TNA’s public task responsibilities as a government department (including its roles as Queen’s printer and in the management of legislation.gov.uk) and its role as a cultural institution.
7.3 The TNA Chief Executive also provided some information on the new charitable trust which has been set up and should be operational by early April. 7.4 The challenges caused by the move to the digital record were raised and discussed once again. Consideration of how to refine processes to deal with this (as opposed to replicating paper-based practices) is a key theme of the new strategy.
7.5 Once the strategy has been approved it will come back to the Council, for information. It is hoped that it will be launched on 1 April.
8. **FOI Panel Update – Paper 8**
8.1 The Head of the FOI Centre gave an overview of the issues and work undertaken by panels. She also presented the most recent service statistics, with reference to Paper 8.
8.2 A big increase in the number of requests (including in the number requiring a public interest test) was noted. A delay in completing one of the panels has also highlighted a need to refine some of the current processes. The FOI Centre will lead on this.
8.3 The need for panels to use consistent terminology (in accordance with a glossary of terms which is available on Egress) was noted.
9. **CEO’s Update – Paper 9**
9.1 The CEO of TNA updated the Council on recent issues. A number of these had already been raised during the other business of the meeting.
9.2 He noted the increased financial pressure on some local archives.
9.3 The HM 150 celebrations were also discussed. Members will be invited to the reception in the House of Lords, which will take place on 8 July.
10. **Any Other Business**
10.1 A member had experienced difficulty in completing the schedule review process within the allocated two-week period and asked if it would be possible to extend the time available, say to three weeks. TNA agreed to look into this.
**ACTION:** TNA to see if it is possible to send out the schedules for review a week early and to report back to members on options.
10.2 The Secretary made a request for any unused laptops to be returned and noted the likely decommissioning of members’ existing email addresses.
There being no further business, the meeting was closed.
**Date of Next Meeting:** The next meeting of the Council would be held on: 13 May 2019 at TNA’s premises at Kew.
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bd251cc59f426d1ae2dc8c0f57b77e21e0bd63c7 | SUMMARY OF ACTIONS
Actions agreed at the meeting
Item 3:
ACTION: TNA to consider if it would be possible for versions of the schedules to be circulated more frequently, to ease the burden on members around meeting times.
ACTION: links to guidance on the redaction process used at TNA to be circulated.
ACTION: the Government Audience team to confirm that Brexit-related files are being treated consistently. **ACTION:** The Government Audience team to check whether departments are correctly complying with the guidance contained in the Gibraltar memorandum.
**Item 5:**
**ACTION:** the Secretary to update the Annual Report and to circulate a version for final approval by members as soon as possible after the meeting.
**ACTION:** members to review the website and provide feedback on it to the Secretary, who shall upload new content, including the updated register of interests.
**ACTION:** the Secretary to set up further audit exercises, on a six-monthly basis.
**ACTION:** TNA to look at tying the proposed file review programme to its own internal audit programme.
**Item 6**
**ACTION:** the Government Audience team to produce a revised Retention Application paper template which will be submitted to the July 2019 meeting for members to review and comment upon.
**Item 7**
**ACTION:** the Secretary to draft a follow-up letter on the basis discussed
**Item 8**
**ACTION:** the FOI Centre to check if any further updates to the section 38 guidance are required.
______________________________________________________________________
1. **Welcome, introductions, apologies and declarations of conflicts of interest**
1.1 The Chair welcomed the attendees.
1.2 There were apologies from Ms Jeannette Strickland.
1.3 The Chair asked members to declare any conflicts of interest which they had identified in relation to the business of the meeting.
1.4 The following recusals apply:
1.4.1 Ms Liz Copper will not comment on BBC matters.
1.4.2 Mr Michael Smyth is unable to comment on matters relating to the Chagos Islands and Diego Garcia.
2. **Minutes and matters arising**
2.1 The minutes of the February meeting were agreed as an accurate record. The February summary minutes were also approved.
2.2 Matters Arising: Action Log Review:
The Chair went through the Action Log and noted progress on the various open actions.
In particular, he noted that:
2.2.1 the current recruitment round is going well. The deadline for applications has now passed and 52 submissions have been received. The Deputy Chair will take part in the sift and interview processes which are due to take place in May and June 2019.
2.2.2 there is some good news on remuneration. It has been agreed that members should be remunerated for the current financial year, with a further application for funding to be made in the next spending round. Remuneration will be based on a day rate. TNA will administer the payment, in accordance with the TNA Chief Executive’s obligations as Accounting Officer. A formal confirmation letter from the Secretary of State is expected shortly.
2.2.3 The Secretary noted that DCMS are following up on the need for a formal delegation of functions from the Secretary of State under Sections 65 and 66 of FOIA. A meeting to discuss this is being arranged. In relation to Section 65, it was also confirmed that the Council has agreed to pick up this work, in principle, subject to completion of the current recruitment round. Work on designing a suitable process is also ongoing.
2.2.4 A number of other outstanding actions were picked up through specific agenda items.
3. Access to Records
3.1 There were no further recusals.
General
3.2 A schedule of closure applications, together with a schedule of retention applications, was sent to members prior to the meeting. Members were asked to raise any queries within 10 days.
3.3 The Senior Access Manager collated the queries and a list of them was circulated with the papers for this meeting, with responses being provided where possible.
3.4 At the meeting, members were asked if they were content with the responses provided, whether in written form or orally. Where a response had not been provided, or members remained unhappy, the queries were carried forward.
3.5 The Council formally approved the acceptance of schedules seen outside the meeting, with the exception of any queries which were brought to the meeting.
Outstanding Queries
3.6 Paper 3.1 Queries outstanding from remote schedule
The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments.
3.7 Paper 3.2 – Queries on Closure and Retention Schedules (February 2018)
The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments. 3.8 **Paper 3.3 - Queries on Closure and Retention Schedules (May 2018)**
The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments, subject to certain exceptions, which were either queried, withdrawn or carried over, as the relevant department had yet to respond.
3.9 **Other discussion points**
Members commented on the length of the schedules this month. A suggestion that TNA could perhaps “pre-review” schedules was rejected, even though it is an approach used by other committees, as the Council was not convinced that this would be compatible with the Council’s statutory role. Instead, members asked if it would be possible to circulate shorter documents more frequently. The Government Audience team agreed to look into possible alternative approaches to schedule review and to circulate a paper detailing these for discussion.
**ACTION:** TNA to consider if it would be possible for versions of the schedules to be circulated more frequently, to ease the burden on members around meeting times.
Members also asked if guidance on the redaction process could be circulated.
**ACTION:** links to guidance on the redaction process used at TNA to be circulated.
Members would like some further reassurance that Brexit-related files are treated consistently and that other sensitivities are given due consideration. The Government Audience will investigate further.
**ACTION:** the Government Audience team to confirm that Brexit-related files are being treated consistently.
There was some discussion about the wording used in relation to entries which relate to Gibraltar. The Government Audience team agreed to check whether departments are correctly complying with the guidance contained in the Gibraltar memorandum.
**ACTION:** The Government Audience team to check whether departments are correctly complying with the guidance contained in the Gibraltar memorandum.
4. **Forum Update**
4.1 The Deputy Chair of the Forum presented her update. She chaired her first meeting on 27 March, which went very well. A very informative paper on the valuation of digital archives for inheritance tax purposes was discussed. On a similar theme, a member of TNA gave an interesting presentation on some of the challenges presented by the move to digital records.
4.2 The Forum is also reviewing its Terms of Reference and hopes to bring a version for approval to the next Advisory Council meeting.
4.3 Local archives are continuing to experience a number of challenges, which remain a cause for concern.
4.4 The progress of the celebrations of one hundred and fifty years of the Historical Manuscripts’ Commissioner’s royal warrant was noted. Members had received notification of a reception to be held at the House of Lords and invitations should follow shortly.
4.5 A recruitment round is underway, which aims to appoint an additional independent member. The deadline for applications has now closed and interviews are being scheduled for 30 May. 5. **Administrative Matters**
**Item 5.1.1 – Section 46 Code of Practice Review**
Ms Fletcher provided a verbal update on this item. A Steering Committee meeting has been held and members have agreed that the new code should be principles-based, with more detailed guidance sitting underneath it. A meeting with the Deputy Chair had just taken place and a further one with the full Working Group would be scheduled, to ensure that TNA fully understands the Council’s position. The plan is to publish a good first draft of the new Code in Autumn 2019, with the final version appearing by the end of the current financial year.
**Paper 5.1.2 – Draft Annual Report**
The Annual Report is published in July as an annex to the TNA Annual Report. The current draft is still missing a few statistics, so the aim is to include these and to circulate the updated report to members for approval very shortly after the current meeting. The Deputy Chair queried a figure which looked incorrect and the Secretary agreed to check this as part of the update process.
**ACTION:** the Secretary to update the Annual Report and to circulate a version for final approval by members as soon as possible after the meeting.
**Item 5.1.3 – Website Updates – Verbal Update**
The Secretary noted that some further updates had been made to the website, including upload of copies of the Forum minutes. She has now received all the Register of Interest forms, so is able to prepare an updated register for final review and upload.
**ACTION:** members to review the website and provide feedback on it to the Secretary who shall upload new content, including the updated register of interests.
**Item 5.1.4 – Appraisals – Verbal Update**
The quantitative data has been included on the draft forms and they should be ready for circulation shortly.
**Paper 5.1.5 - Review/ Audit Process**
The Deputy Chair summarised the findings of the file review process which was carried out at TNA on 10 April. Members of the review team found the exercise informative. No overwhelming evidence of problems with the process was uncovered, although a few issues were identified. Some useful lessons were also learned, so the team recommend that the process is repeated within six months. It may also be instructive for new members to participate, as it may help them better to understand TNA processes. It was agreed that the Secretary should set up further reviews, on a six-monthly basis.
**ACTION:** the Secretary to set up further audit exercises, on a six-monthly basis.
There was a query as to whether the process could be linked with any TNA internal audits and the TNA Chief Executive agreed to look at this. The schedule application process had been the subject of an audit in the previous calendar year and that some process changes had been adopted as a result.
**ACTION:** TNA to look at tying the proposed file review programme to its own internal audit programme. LUNCH was provided and during the break members were given a tour of the ongoing TNA Cold War exhibition.
6. Departmental Retention Requests
A large number of papers were received before the meeting, as a result of TNA’s Information Management Report work. They were therefore divided into three sections, as follows:
Item 6.1 – Business as Usual Papers
Updated Brexit memorandum. This was a re-presentation of an item from July 2018. Due to the postponement of the planned EU exit date, it was agreed that members should see the paper again, perhaps at the February 2020 meeting. Members were content with the paper, although there was one clarification query.
DECISION: memorandum accepted, subject to one clarification. It is proposed that this comes back in February 2020.
There were also updates from:
- Department for Food, the Environment and Rural Affairs
- Animal and Plant Health Agency; and
- The National Archives.
Item 6.2 – applications from Ministerial Departments
There were applications for retentions of between one and three years from the following departments:
- Business, Energy and Industrial Strategy
- Department for Food, the Environment and Rural Affairs
- Department for International Development
- Home Office
- Ministry of Justice; and
- Northern Ireland Office.
Item 6.3 – Applications from arm’s length bodies
A large number of papers from arm’s length bodies were received before the meeting so, to assist in the review process, these were circulated in advance to members, who were asked to indicate which ones they wished to discuss at the meeting. The others would be deemed to have been approved. The following papers were discussed in more detail:
- Metropolitan Police Service.
- Royal Botanic Gardens, Kew.
- The Postal Museum.
Members noted that the papers were in a variety of different formats. Ms Fletcher confirmed that her team is working to produce a simplified and standardised response template, with drop-down options. She hopes to bring an initial proposal for the new template to the July 2019 meeting for review and comment. **ACTION:** the Government Audience team to produce a revised Retention Application paper template which will be submitted to the July 2019 meeting for members to review and comment upon.
The Secretary will notify the relevant departmental contacts of these outcomes following the meeting.
**ACTION:** the Secretary to write to departments to notify them of the outcome of the Council’s deliberations regarding their requests. Following the meeting, the Council’s recommendations which will go forward to the Secretary of State.
7. **Paper 7 – Access under Review issue**
7.1 This item follows on from a paper which was presented to the February meeting, which concerned a large volume of records for which access is under review. The Council was seeking further assurances with regard to these, including the position regarding the handling of FOI requests and public access. The Council noted the points made and agreed to follow the matter up accordingly.
**ACTION:** the Secretary to draft a follow-up letter on the basis discussed.
8. **FOI Panel Update – Paper 8**
8.1 The Head of the FOI Centre gave an overview of the issues and work undertaken by panels. She also presented the most recent service statistics, with reference to Paper 8. She noted that these were broadly in line with previous reports.
8.2 The continued high volume of cases was highlighted.
8.3 A number of wider issues highlighted by panels were addressed in the paper. One case actually saw the release of the relevant record, as it was accepted that the cited exemption was not applicable.
8.4 Some additional guidance on section 38 has also been uploaded to Egress, but this may need to be updated further.
**ACTION:** the FOI Centre to check if any further updates to the section 38 guidance are required.
9. **CEO’s Update – Paper 9**
9.1 The CEO of TNA updated the Council on recent issues.
9.2 He noted that the new TNA strategy, which had been presented at the previous meeting, had been approved and that it would shortly be made available to the public.
9.3 TNA is also in the process of adopting new branding, which is to be rolled out over the coming months.
9.4 The CEO of TNA also noted the additional work which TNA has had to do as a result of the move from the 30 to the 20 year rule. This has also put pressure on departments at a time of decreasing resources. Members considered whether there might be a knock-on effect on the number of retention requests. If this occurs, it should be picked up through the Council’s reporting mechanisms and highlighted in the Annual Report, if necessary.
9.5 Progress on the setting up on the new Trust was also noted, as was the CEO of TNA’s role as the Queen’s Printer. The CEO of TNA gave a further explanation of this latter role and noted the excellent progress which has been made by TNA in getting published primary legislation up to date.
10. Any Other Business
10.1 There being no further business, the meeting was closed.
Date of Next Meeting: The next meeting of the Council would be held on: 15 July 2019 at Bouygues premises in central London. | 6.3 | Non-ministerial departments | Notes | |-----|-----------------------------|-------| | 6.3.1 | Civil Aviation Authority | | | 6.3.2 | Environment Agency | | | 6.3.3 | Food Standards Agency | | | 6.3.4 | Health and Safety Executive | | | 6.3.5 | Her Majesty's Land Registry | | | 6.3.6 | Historic Royal Palaces | | | 6.3.7 | Metropolitan Police Service | Discussed at the meeting | | 6.3.8 | Natural England | | | 6.3.9 | Office for National Statistics | | | 6.3.10 | Office for Standards in Education, Children's Services and Skills | | | 6.3.11 | Royal Botanic Gardens | Discussed at the meeting | | 6.3.12 | The Tate | | | 6.3.13 | The Royal Parks | | | 6.3.14 | United Kingdom Debt Management Office | | | 6.3.15 | Welsh Government | | | 6.3.16 | The Postal Museum | Discussed at the meeting |
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4a5b5f24b1732765387e209d01c5b5cf43239435 | SUMMARY OF ACTIONS
Actions agreed at the meeting
Item 2:
ACTION: the Chair to write to DCMS to encourage progress on the formal delegations.
ACTION: the Senior Access Manager to provide an options papers on possible changes to the frequency and timing of the circulation of schedules, for consideration at the next meeting.
ACTION: the Secretary to make the arrangements for the October file audit exercise as soon as possible. Item 3:
**ACTION:** TNA to clarify any requirement for Council involvement in the FOI Panels for the records affected by the access under review issue.
Item 4:
**ACTION:** TNA to provide a note on the application of Section 40 to members.
Item 5:
**ACTION:** the Secretary to circulate details of the October HM150 conference, once they are available.
**ACTION:** TNA to consider if there are ways it can exert influence to ensure that important cultural property is preserved for the nation.
**ACTION:** the Chair of the Advisory Council and the Deputy Chair of the Forum to discuss separately if there is any action which the Forum can take to exert influence to ensure that important cultural property is preserved for the nation.
**ACTION:** TNA to provide further detail to members on the origins of the Forum, its responsibilities and those of the Master of the Rolls and the CEO of TNA.
Item 6
**ACTION:** the Secretary to contribute a section on the role of the Advisory Council to any “day one” briefings to new ministers.
**ACTION:** the Senior Access Manager to produce a paper on further revisions to the standard retention criteria.
**ACTION:** TNA to bring the revised Retention Application Template back to the next meeting with the suggested improvements.
Item 10
**ACTION:** the Secretary to address ongoing issues with the Egress system.
______________________________________________________________________
1. **Welcome, introductions, apologies and declarations of conflicts of interest**
1.1 The Chair welcomed the attendees.
1.2 There were apologies from Ms Jeannette Strickland.
1.3 The Chair asked members to declare any conflicts of interest which they had identified in relation to the business of the meeting.
1.4 The following recusals apply:
1.4.1 Ms Liz Copper will not comment on BBC matters. 1.4.2 Mr Michael Smyth is unable to comment on matters relating to the Chagos Islands and Diego Garcia.
2. **Minutes and matters arising**
2.1 The minutes of the May meeting were agreed as an accurate record. The May summary minutes were also approved.
2.2 Matters Arising:
**Action Log Review:**
The Secretary went through the Action Log and noted progress on the various open actions. Some of these were for discussion later in the meeting as specific agenda items.
In particular, she noted that:
2.2.1 the template for remuneration claims had been drafted and would be circulated to members after the meeting.
2.2.2 there was no further news on the formal delegation of functions from the Secretary of State under Sections 65 and 66 of FOIA. The Chair offered to write to DCMS to try and expedite the matter.
**ACTION:** the Chair to write to DCMS to encourage progress on the formal delegations.
2.2.3 there was an outstanding action on possible ways of improving and streamlining the procedure for reviewing schedules, in order that more responses to members’ queries on schedule items could be available at the subsequent meeting. It was agreed that it was important for such responses to be considered in committee, unless they were obviously uncontroversial. It was agreed that the Senior Access Manager would provide an options papers on possible changes to the frequency and timing of the circulation of schedules for consideration at the next meeting.
**ACTION:** the Senior Access Manager to provide an options papers on possible changes to the frequency and timing of the circulation of schedules, for consideration at the next meeting.
2.3 It was agreed that the arrangements for the next file audit should be put in place immediately and should not wait until the current recruitment round has been completed.
**ACTION:** the Secretary to make the arrangements for the October file audit exercise as soon as possible.
2.4 Members considered the draft agenda for the September training session (Paper 2.4). It was agreed that the time for the session by a representative of the Information Commissioner’s Office (which was confirmed shortly after the meeting) should be extended, if possible. Otherwise, the outline was agreed.
3. **Access to Records Issue**
3.1 Four representatives from MOD and its subcontractor attended in person to present on this issue.
3.2 The department also gave reassurances that it was now handling FOI requests directly. There was a query as to whether Council panels would need to consider the public interest in the usual way. It was agreed that this would be confirmed outside the meeting. ACTION: TNA to clarify any requirement for Council involvement in the FOI Panels for the records affected by the access under review issue.
4. Access to Records
4.1 There were no further recusals.
General
4.2 A schedule of closure applications, together with a schedule of retention applications, was sent to members prior to the meeting. Members were asked to raise any queries within 10 days.
4.3 The Senior Access Manager collated the queries and a list of them was circulated with the papers for this meeting, with responses being provided, where possible.
4.4 At the meeting, members were asked if they were content with the responses provided, whether in written form or orally. Where a response had not been provided, or members remained unhappy, the queries were carried forward.
4.5 The Council formally approved the acceptance of schedules seen outside the meeting, with the exception of any queries which were brought to the meeting.
Outstanding Queries
4.6 Paper 4.1 Queries outstanding from remote schedule
The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments.
4.7 Paper 4.2 – Queries on Closure and Retention Schedules (May 2019)
The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments.
4.8 Paper 4.3 - Queries on Closure and Retention Schedules (July 2019)
The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments, subject to certain exceptions, which were either queried, withdrawn or carried over, as the relevant department had yet to respond.
4.9 Other discussion points
There was a brief discussion of Section 40, which is an absolute exemption, but also brings in a “fairness” test under GDPR. Members asked for more detail on this issue and the Head of TNA’s FOI Centre agreed to provide a note.
ACTION: TNA to provide a note on the application of Section 40 to members.
5. Forum Update
5.1 The Deputy Chair of the Forum presented her update. She confirmed that there had been no further meetings of the Forum since the session on 27 March 2019, which was reported to the previous Advisory Council meeting. 5.2 She noted that the recent House of Lords event to celebrate one hundred and fifty years of the Historical Manuscripts’ Commissioner’s royal warrant went very well. Another event (a two-day conference) is planned for October. It was agreed that the Secretary would circulate further details of this, once they were available.
**ACTION:** the Secretary to circulate details of the October HM150 conference, once they are available.
5.3 The Deputy Chair of the Forum also raised an issue around an important private archive which has been sold abroad (although export is currently deferred). It appears that Acceptance in Lieu was not considered in this case. She wondered if there was any way that TNA and/or the Forum could assist in preserving this for the nation, for example by raising awareness of the Acceptance in Lieu regime. TNA agreed to have a look at this further, but noted that it was also open to the Forum to take action separately.
**ACTION:** TNA to consider if there are ways that it can exert influence to ensure that important cultural property is preserved for the nation.
**ACTION:** the Chair of the Advisory Council and the Deputy Chair of the Forum to discuss separately if there is any action which the Forum can take to exert influence to ensure that important cultural property is preserve for the nation.
5.4 It was noted that the Forum’s role is not set out in statute, but it delivers the Advisory Council’s remit concerning public records outside the public records system, which is linked to the responsibilities of the Historical Manuscripts Commissioner, as appointed by Royal Warrant. It is currently constituted as a sub-committee of the Advisory Council. It was agreed that TNA would provide further detail on the origins of the Forum, its responsibilities and those of the Master of the Rolls and the CEO of TNA.
**ACTION:** TNA to provide further detail to members on the origins of the Forum, its responsibilities and those of the Master of the Rolls and the CEO of TNA.
5.5 The Deputy Chair of the Forum gave an oral update on the status of the current recruitment round, which aims to appoint an additional independent member.
5.6 **Paper 5 – the proposed Terms of Reference for the Forum** was also discussed and approved, subject to one minor amendment.
**LUNCH** was provided.
6. **Administrative Matters**
**Item 6.1.1 – Section 46 Code of Practice Review**
The Deputy Chair provided an oral update on this item. TNA’s Government Audience team has written to him about the proposed approach for the new code and a follow-up meeting is planned once a draft is available. The intention remains to publish a first draft of the new code in Autumn 2019, with the final version appearing by the end of the current financial year. However, some issues relating to the position in Northern Ireland may cause delay to this timetable.
**Paper 6.1.2 – Draft Annual Report**
The Annual Report has now been approved and will be published in July as an annex to the TNA Annual Report. The final version was provided to members with the meeting papers for information. Item 6.1.3 – Website Updates – Verbal Update
The Secretary noted that some further updates had been made to the website, including upload of the register of members’ interests and the most recent meeting minutes. The next update will be the Forum Terms of Reference (see agenda item 5).
Item 6.1.4 – Recruitment – Verbal Update
The Deputy Chair, who is sitting on the interview panel, gave an oral update. He confirmed that the current recruitment round continues and that there have been some strong candidates. A final interview is being held this week and a submission to recommend the appointments will then go to ministers. The timescales for this are unclear and there may be some delay, as there is likely to be a ministerial reshuffle following the Conservative Party leadership election. Separately, it was noted that the Secretary was working with TNA to ensure that any initial briefing for new ministers included up to date information on the Advisory Council.
**ACTION:** the Secretary to contribute a section on the role of the Advisory Council to any “day one” briefings to new ministers.
Item 6.1.5 – Remuneration Update
The Secretary reported that, as of 8 July, the confirmatory letter from DCMS regarding remuneration had still not been sent to members, although DCMS had provided further assurances that the payments are in hand and will be backdated. In the meantime, the intention is that members will be provided with template claim forms following the meeting, so that they can submit their claims for the first applicable quarter.
Item 6.1.6 – FOI Matters
The Secretary gave an oral update on two recent FOI requests to the Council.
Paper 6.1.7 – Revised Retention Criteria
The Senior Access Manager at TNA presented a paper on the proposed refinement of retention Criterion 4, proposing that it should be split into two sub-categories, thereby making a distinction between material not yet appraised for selection (or disposal) and material selected for permanent preservation and transfer. This is intended to assist in the accessions process. The Senior Access Manager also confirmed that the current criteria are used for administrative convenience and have no statutory basis. Members noted that certain of the other criteria (notably 5 and 7) appear to be used rarely or never and so queried whether they were still needed. It was agreed that there was no reason to retain them.
There were no further comments on the paper, which was approved, but the Senior Access Manager agreed to produce a further paper on the removal of the two unused criteria.
**ACTION:** the Senior Access Manager to produce a paper on further revisions to the standard retention criteria.
Paper 6.1.8 – Revised Retention Application Template
This is a proposed simplification and standardisation by TNA of the template used by departments when making retention applications. Innovations include a new system of drop-down menu options. Members welcomed the innovation and suggested some further improvements, including a new section on “context” and more information on time required. They also suggested the production of another template for updates, to include a red/amber/green status and an indication of milestones achieved to date. Members also suggested that a separate guidance document might be useful. Finally, they thought that a detailed justification should be provided for any application of over three years’ duration. The Government Audience team agreed with these recommendations and will propose further changes at the next meeting.
**ACTION:** TNA to bring the revised Retention Application Template back to the next meeting with the suggested improvements.
7. **Departmental Retention Requests**
**Item 7.1 – Business as Usual Papers**
The Council considered papers from departments relating to the retention of records. The outcome of its deliberations is set out below. The Secretary will notify the relevant departmental contacts of these outcomes following the meeting.
**ACTION:** the Secretary to write to departments listed below to notify them of the outcome of the Council’s deliberations regarding their requests. Following the meeting, the Council’s recommendations will go forward to the Secretary of State.
- Foreign and Commonwealth Office
- HM Treasury
- Ministry of Justice
- Department for Education
- Ministry of Defence (two papers)
- Home Office
- Northern Ireland Office
- Advisory, Conciliation and Arbitration Service
- Metropolitan Police Service.
Requests were, in each case, for between one and ten years and arose because the relevant records form part of a backlog awaiting appraisal or preparation for transfer.
8. **FOI Panel Update – Paper 8**
8.1 The Head of the FOI Centre gave an overview of the issues and work undertaken by panels. She also presented the most recent service statistics and highlighted some procedural points, with reference to Paper 8. She also asked that the FOI Inbox be copied in, when panels are providing their responses.
8.2 The continued high volume of cases was highlighted.
8.3 The Head of the FOI Centre also agreed to follow up on an existing action to check if any further updates to the section 38 guidance are required.
9. **CEO’s Update – Paper 9**
9.1 The CEO of TNA updated the Council on current issues.
9.2 Progress on the transition to the 20 year rule was noted, as was the move to digital records, which is increasingly being reflected in applications to the Council. He also noted the Government Audience team’s success in getting departmental legal compliance to almost 100%.
9.3 Some issues with local archives were noted.
10. **Any Other Business**
10.1 A member noted a recurring problem with Egress where users were quickly timed out of access – sometimes in the middle of reviewing a document. The Secretary agreed to look into this.
**ACTION:** the Secretary to address ongoing issues with the Egress system.
10.2 There being no further business, the meeting was closed.
**Date of Next Meeting:** The next meeting of the Council would be a training session held on: 23 September 2019 at TNA premises.
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f1ccaf1021ca562ff085e364837f411f7c635c5a | SUMMARY OF ACTIONS
Actions agreed at the meeting
Item 2:
ACTION: any member who is interested in taking part in the Working Group should contact the Deputy Chair.
Item 3: ACTION: MOD are to be asked to provide a written update for February. The possibility of inviting them to the May meeting should also be left open.
Item 4:
ACTION: members asked that copies of the memorandum and checklists be provided to them in accessible form.
Item 5:
ACTION: it was agreed that a TNA paper on the history of the Forum should be circulated to the wider membership.
Item 7
ACTION: the Code of Practice to be included as an item on the agenda for the February 2020 meeting.
ACTION: an invitation to be extended to the Deputy Chair to attend a meeting of the Code of Practice Steering Group.
ACTION: TNA to update the retention application/ update templates to reflect the revised retention criteria.
ACTION: the Secretary to make the arrangements for the April file audit exercise.
ACTION: files which are potentially of interest for audit purposes should be flagged at the meeting where the relevant schedule entry is discussed.
ACTION: TNA to consider how best to feed back the audit findings to departments
Item 9
ACTION: new members to be phased into the FOI Panel process by the Secretary.
Item 10
ACTION: TNA to provide the Chair with information on the location of the 43 Places of Deposit.
Item 11
ACTION: The Deputy Chair and the Secretary will discuss further the idea that, as part of its continuous improvement work, the Council invites feedback from departments.
ACTION: The Deputy Chair agreed to check the ICO website for Section 27 guidance and to circulate it.
ACTION: any members who are interested in obtaining or renewing Developed Vetting Security Clearance should inform the Secretary.
1. Welcome, introductions, apologies and declarations of conflicts of interest
1.1 The Chair welcomed the attendees, including six new members, who were attending their first meeting.
1.2 There were apologies from Mr Stephen Hawker, a new member. 1.3 The Chair asked members to declare any conflicts of interest which they had identified in relation to the business of the meeting.
1.4 The following recusals apply:
1.4.1 Ms Liz Copper is an employee of the BBC, so will not comment on BBC matters.
1.4.2 Mr Michael Smyth is unable to comment on matters relating to the Chagos Islands and Diego Garcia.
2. Minutes and matters arising
There were no formal minutes to approve, as the September meeting was a training session.
A summary of the July minutes has been uploaded to the website.
Item 2.1 – Wash-up following the September training session
The Chair invited members to reflect on the September training session, which included presentations from ICO, FCO and the TNA Digital team.
Members thought that the sessions went well and were informative, although there were issues with timing, which meant that the session overran.
Paper 2.2 – Action Log and Paper 2.2.1 – Action Log Updates
The Chair went through the most recent updates to the action log. A number of actions were considered as specific agenda items. The most significant of the finalised actions are the completion of the process of recruitment and the induction of seven new Council members, six of whom were able to attend the November meeting.
The Chair also noted that:
2.2.1 now that the new members have been appointed, the Council is ready to take on responsibility for the public interest test for FOI requests under Section 65 of FOIA, although the details have yet to be agreed between DCMS and the Cabinet Office. It was noted that currently the Council has no role in considering FOI requests which engage Sections 23 and 24 of FOIA, which should be reviewed as part of the revision of the Code of Practice.
2.2.2 the Chair would write to the new Secretary of State once he or she is appointed following the general election about the proposed delegation to the Council under section 66 of FOIA.
2.3.3 there would be merit in reviving the Working Group and anyone interested in joining was invited to contact the Deputy Chair.
ACTION: any member who is interested in taking part in the Working Group should contact the Deputy Chair.
3. Access to Records Issues
3.1 Four representatives from MOD attended in person to present on two ongoing issues – the NDA/ AWE records, which have been the subject of previous appearances at the Council, and the Service Personnel Records (which include the related issue of the Guards papers, which was previously discussed at the July meeting). 3.2 TNA had also clarified the status of “access under review” records. A note had been provided to the Chair and Deputy Chair in the first instance. FOI requests for these records could be handled under Section 65 or 66 of FOIA. If the former, there would be no requirement for the Council to consider the public interest in release through panels under such time as the Council took on such responsibility in relation to Section 65 cases more generally.
3.3 Overall, both members and TNA staff were content with the proposals, although there are residual concerns about timescales.
3.4 Members had also sought further information about the legal and practical effects of records being temporarily categorised as “access under review” status. TNA noted that a note had been provided to the Chair and Deputy Chair, in the first instance.
3.5 Members also reiterated the need for the media group to be prepared to handle any media interest, as per the action log.
**ACTION:** MOD are to be asked to provide a written update for February. The possibility of inviting them to the May meeting should also be left open.
3.6 The department had sought retentions in respect of both the guards and the service personnel records.
4. **Access to Records**
4.1 There were no further recusals.
**General**
4.2 A schedule of closure applications, together with a schedule of retention applications, was sent to members prior to the meeting. Members were asked to raise any queries within 10 days.
4.3 The Senior Access Manager collated the queries and a list of them was circulated with the papers for this meeting, with responses being provided, where possible.
4.4 At the meeting, members were asked if they were content with the responses provided, whether in written form or orally. Where a response had not been provided, or members remained unhappy, the queries were carried forward.
4.5 The Council formally approved the acceptance of schedules seen outside the meeting, with the exception of any queries which were brought to the meeting.
**Outstanding Queries**
4.6 **Paper 4.1 Queries outstanding from remote schedule**
The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments, as more fully described in the Annex to these minutes.
4.7 **Paper 4.2 – Queries on Closure and Retention Schedules (July 2019)**
The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments, as more fully described in the Annex to these minutes. 4.8 **Paper 4.3 - Queries on Closure and Retention Schedules (November and September 2019)**
The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments, as more fully described in the Annex to these minutes.
4.9 **Other discussion points**
**ACTION:** members asked that copies of the memorandum and checklists be provided to them in accessible form.
5. **Forum Update (NB: this item took place after item 6 as the meeting was running slightly late)**
5.1 The Chair noted that he had chaired the full Forum meeting on 22 September 2019. The meeting was combined with the September training session, so three Council members who are not also members of the Forum attended. The meeting focussed on a new strategy and action plan for the Forum, which will be discussed further at its next meeting, which is to be held on 11 December. The need to do a skills audit of members was also identified and this is in hand. It has also been suggested that members convene by teleconference if necessary between meetings.
5.2 The Chair noted that it was a useful session and that he had learned more about the Forum and its role as a sub-committee of the Council.
**ACTION:** it was agreed that a TNA paper on the history of the Forum should be circulated to the wider membership.
5.3 The Deputy Chair of the Forum then presented her update. She noted that role of the Council in advising the Historical Manuscripts Commission on Acceptance in Lieu cases. She said the Forum would like to be more actively involved in issues of concern to the archives and academic communities relating to non-government archives.
5.4 It was noted that TNA also undertakes a lot of activity in these areas and that it sometimes does so “behind the scenes”.
5.5 In addition, a symposium to celebrate HMC 150 took place on 14 October. The Deputy Chair of the Forum acted as a panel member for this.
**LUNCH** was provided.
6. **MPS Presentation**
6.1 MPS representatives attended in person further to their July retention application, as the Council had requested further information.
6.2 The departmental attendees described ongoing efforts to address the review backlog. This largely consists of paper files, but there is some digital material.
6.3 The department noted that it was happy to provide regular updates to the Council.
6.4 It also noted that the problem is finite, as MPS records produced after March 2000 are no longer public records for the purposes of the Public Records Act 1958.
**DECISION:** it was noted that the current retentions expire in 2020, so members asked that the department provide a written update in May 2020. 7. **Administrative Matters**
This section dealt with ongoing administrative and process matters which have arisen, largely from the ongoing work of the Working Group, but also from the September training session.
**Item 7.1.1 – Section 46 Code of Practice Review**
The Director for Government Audience gave a short oral update on progress on the Code of Practice review, for information. She explained the background to and purpose of the Code and noted that the last review was in 2009, so an update is needed, not least to reflect the move to digital records. The process is taking some time, as there is an obligation to consult with statutory stakeholders, such as Cabinet Office and the Office of the Information Commissioner (ICO).
It was also agreed that an invitation would be extended to the Deputy Chair to attend a meeting of the Steering Group which was planned for January. A copy of the near-final draft of the Code should be available after this meeting and will be circulated to members.
**ACTION:** the Code of Practice to be included as an item on the agenda for the February 2020 meeting.
**ACTION:** an invitation to be extended to the Deputy Chair to attend a meeting of the Steering Group.
The following three items were briefly introduced by Ms Lucy Fletcher. They had all previously been presented to the Council so were approved. The need to update the templates to reflect the revised retention criteria was noted, though.
**ACTION:** TNA to update the retention application/ update templates to reflect the revised retention criteria.
**Paper 7.1.2 – Revised Retention Criteria**
This is a proposed retirement of criteria 3.5 and 7.
**Paper 7.1.3A – Revised Retention Application Template**
This is a further update on a proposed simplification and standardisation by TNA of the template used by departments when making retention applications. Innovations include a new system of drop-down menu options; a new section on “context” and more information on required timescales.
**Paper 7.1.3B – Revised Update Template**
This is a proposed simplification and standardisation by TNA of the template used by departments when providing updates. This was specifically requested by members, to include a red/amber/ green status; an indication of milestones achieved to date and a detailed justification for any application of over three years’ duration.
A suggestion that departments should have an additional field where they could propose an update date was rejected, after discussion.
**Paper 7.1.4 – the Journey of the File**
This paper summarised a presentation which was due to be included in the September training session. However, this had to be deferred because of timing issues. Members thought it a useful and insightful document and recommended that this it be included in TNA standard guidance, if possible.
Paper 7.1.5 – October File Audit report
A panel of three Council members attended at TNA premises on 31 October to conduct a review of transferred files. This followed on from a similar process in April. The purpose of these sessions is to compare the closure schedule entries for various items with the closed extract(s) which are eventually transferred to TNA and to check for anomalies. A member of the review panel presented the findings and there was a discussion as to how feedback on these could be provided to TNA and departments. All participants agreed that it had been a useful exercise. They noted that:
- Some derogatory comments did not in practice seem a good basis for withholding information. However, it was thought that this issue had been addressed to an extent by the current practice of members asking for details of the particular comments relied on.
- There was one instance where there seemed to be a cataloguing error.
- On one file, some comments were erroneously cited as legal opinion.
They also noted some practical points, such as the need to select a number of files for review, due to the risk that selected items might be unavailable. A suggestion that audits could perhaps be held quarterly was rejected on resourcing grounds.
**ACTION:** the Secretary to make the arrangements for the April file audit exercise.
**ACTION:** files which are potentially of interest for audit purposes should be flagged at the meeting where the relevant schedule entry is discussed.
**ACTION:** TNA to consider how best to feed back the audit findings to departments.
Paper 7.1.6 – ICO Decision
An FOI request relating to the Denning papers which the Council received last year went to Internal Review and was subsequently the subject of an appeal to the ICO. The decision is now available. It upholds the Council’s position, although a couple of technical points were raised and the delay in responding were noted. No further action is to be taken. The Secretary confirmed that the Council’s processes have been reviewed as a result of this request and are now more streamlined.
8. **Departmental Retention Requests**
Twenty-eight papers were submitted for consideration at the meeting. It was therefore agreed, in line with the process used at the February session, that that the applications from Arm’s Length Bodies should be dealt with out of committee, with members noting in advance any papers which they would specifically like to discuss during the session and the rest to go forward to the Secretary of State. The Council considered papers from departments relating to the retention of records. In addition, a number of departments had provided updates, further to requests from members made at previous meetings.
The Council’s decisions made in respect of each paper are noted below. Any resulting approval recommendations then go forward to the Secretary of State.
**ACTION:** The Head of Governance will write to departments to notify them of the Council’s recommendations, including any which will go forward to the Secretary of State with regard to their retention requests.
There were applications for retentions of between one and six years from the following departments: There were applications for retentions of between two and three years from the following arm’s length bodies:
- Crown Prosecution Service
- Medicines and Healthcare products Regulatory Agency
- Competition and Markets Authority
Updates were received from the following departments:
- The Charity Commission
- HM Revenue and Customs
9. **FOI Panel Update – Paper 9**
9.1 The Head of the FOI Centre gave an overview of the issues and work undertaken by panels. She also presented the most recent service statistics. She also noted three recent issues: redaction of records; application of Section 27 and application of Section 38. She highlighted work to update FOI guidance, notably on Section 40. The Section 38 guidance is in progress and should be available shortly.
9.2 The continued high volume of cases was also noted, as were ongoing staffing issues.
9.3 There is an intention to phase the new members into the Panel process on the basis that there will be one of them per panel, and that they will not act as the Panel Chair until they have gained some experience of the process.
**ACTION:** new members to be phased into the FOI Panel process by the Secretary.
10. **CEO’s Update – Paper 9**
10.1 TNA’s CEO gave his update on current issues and ongoing matters. He noted progress with the National Archives Trust and the planned relaunch of the Discovering Collections, Discovering Communities conference, as well as new grant funding which has been announced. He also covered the HMC 150 celebrations and his tour of regional archives. The Chair asked if he could be provided with information on the location of the 43 Places of Deposit.
**ACTION:** TNA to provide the Chair with information on the location of the 43 Places of Deposit. 10.2 He also noted the work of TNA’s legislation team, which as part of the CEO’s role as the Queen’s Printer, is currently ensuring that the online legal database legislation.gov.uk is preparing all the legislation ready for Brexit. The Chair noted his admiration for the work of this team.
11. Any Other Business
11.1 It was agreed that any of the new (or indeed the existing) members who are interested in obtaining or renewing Developed Vetting Security Clearance should inform the Secretary.
**ACTION:** any members who are interested in obtaining or renewing Developed Vetting Security Clearance should inform the Secretary.
11.2 When asked for feedback on their first meeting, new members said that there had been a lot of business to get through and a lot to take in, but that it had been a very interesting session. They thought that the Schedules process was perhaps a bit unwieldy (although longer-standing members noted that the process had actually become more streamlined and less paper-intensive than it had been previously). The new members also noted their approval of the new remuneration arrangements.
It was suggested that as part of its continuous improvement work, the Council could invite feedback from stakeholders. The Deputy Chair and the Secretary agreed to discuss this further.
**ACTION:** the Deputy Chair and the Secretary will discuss further the idea that, as part of its continuous improvement work, the Council invites feedback from departments.
It was noted that there is guidance on Section 27 (which had come up a few times in discussions) on the ICO website.
**ACTION:** The Deputy Chair agreed to check the ICO website for Section 27 guidance and to circulate it.
11.3 There being no further business, the meeting was closed.
**Date of Next Meeting:** The next meeting of the Council was to be held on: **10 February 2020**, at TNA premises.
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ece52e8c2629488765ffeaa7a0531078b07a2909 | SUMMARY OF ACTIONS
Actions agreed at the meeting
**ACTION:** The Head of Governance to update the Actions Log with items reported at the meeting.
**ACTION:** The Advisory Council asked that following the Government reshuffle announcement, a note be sent to members advising them of the new DCMS Ministerial team.
**ACTION:** The Council noted the update but felt it did not have sufficient information on the methodology, timetable and communications strategy to agree that the approach for returning nuclear records to public access was appropriate and asked that the MoD (and others) attend in person to provide further clarification at the May meeting. **ACTION:** The Deputy Chair agreed to circulate the 2017 Working Group guidance on derogatory comments to Council members.
**ACTION:** The Deputy Chair of the Forum on Historical Manuscripts and Academic Research agreed to bring an update paper to the May Council meeting on its work.
**ACTION:** The Council asked to be kept updated on the legal position regarding Section 66.
**ACTION:** That the 17th Annual Report include statistics on the number of requests the Council has dealt with and how many it has challenged. To highlight the membership changes, explain the Council’s objectives, state the health of the process and records system. The report should also include examples of where the FOI Panels have made a difference.
**ACTION:** The Head of Governance to ensure the terms of reference and meeting summaries on the website are up-to-date.
**ACTION:** Cabinet Office to be asked to provide an update on the EU Exit Memorandum and Checklist at the next meeting.
**ACTION:** The Head of Governance to keep Council members updated on the forthcoming DCMS Tailored Review.
**ACTION:** The Head of Governance to write to departments to notify them of the Council’s recommendations, including any which will go forward to the Secretary of State with regard to their retention requests.
**ACTION:** The Head of the FOI Centre reported she will be updating guidance and wider materials for members in Egress.
**ACTION:** The Head of FOI Centre agreed to send Council members guidance on Section 41 – information provided in confidence.
**ACTION:** The Head of Governance/Deputy Chair to write to the FCO about the Council’s concerns on the inconsistent application of FOIA exemption 27(1) in addition to 27(2) or 41 and to seek their view on the principle.
**ACTION:** The Council requested to see examples of final refusal notices in relation to the application of the Public Interest Test for FOIA requests.
**ACTION:** The Chief Executive and Keeper undertook to keep the Council updated and would present the findings of the document ordering service trial at its July or November meeting.
**ACTION:** The Council supported the trialling of paperless meetings. Members requiring a full hardcopy set of papers should notify the Head of Governance individually.
**ACTION:** The Council agreed that the 2014 Jenkins Report on the Denning papers should be made available to members.
______________________________________________________________________
1. **Welcome, introductions, apologies and declarations of interest**
1.1 The Chair welcomed everyone to the meeting.
1.2 Apologies for absence were received from Lady Moira Andrews, Dr Peter Gooderham and Ms Jeannette Strickland.
1.3 The Chair asked members to declare any conflicts of interest which they had identified in relation to the business of the meeting. 1.4 The following recusals applied:
1.4.1 Ms Liz Copper as an employee of the BBC, will not comment on BBC matters generally and, more specifically, on the recent request in relation to the Lord Denning/Profumo papers from a BBC journalist, which was raised under any other business.
1.4.2 Mr Trevor Woolley was Private Secretary to the Cabinet Secretary for three years of the period covered by the Cabinet Office update under item 7. In the absence of Jeannette Strickland, he agreed to introduce the Cabinet Office item and recuse himself from the discussion.
1.5 The Chair introduced and welcomed Asha Bagayat who has recently joined TNA as its new Head of Governance and will also be providing governance expertise to the Council.
2. Minutes and matters arising
Minutes of the meeting held on 19 November 2019
2.1 Subject to amending paragraph 5.3 to read “She said the Forum would like to be more actively involved in issues of concern to the archives and academic communities relating to non-government archives,” the minutes of the meeting held on 19 November 2019 were approved as a correct record.
Actions Log
2.2 The Chair went through the Actions Log and noted progress on the various open actions. The following updates were reported at the meeting:
Action 18/92 – It was agreed that members who would like to seek security clearance should contact the Head of Governance.
Action 28 – Hillary Bauer, Martin Howard and Philip Johnson have agreed to undertake an Audit in April.
Actions 43 and 44 – Hillary Bauer confirmed that the Forum did wish to pursue if there was any action it could take to exert influence to ensure that important cultural property was preserved for the nation.
Action 49 – The Advisory Council agreed to close this action.
Action 54 – It was noted that the Deputy Chair had set up a Governance Working Group with six other members to review and update processes and procedures. The Working Group will have an initial meeting following the Council meeting.
2.3 ACTION: The Head of Governance to update the Actions Log with items reported at the meeting.
2.4 ACTION: The Advisory Council asked that following the Government reshuffle announcement, a note be sent to members advising them of the new DCMS Ministerial team.
3. Ministry of Defence (MOD) Nuclear Records Review Update
3.1 The Council received and noted an update paper from the MOD on their proposed approach and estimated timescale to review the proliferation risk of approximately 78,000 records owned by itself and the Nuclear Decommissioning Authority.
3.2 ACTION: The Council noted the update but felt it did not have sufficient information on the methodology, timetable and communications strategy, to agree that the approach for returning nuclear records to public access was appropriate, and asked that the MOD (and others) attend in person to provide further clarification at the May meeting.
4. Access to Records 4.1 There were no further recusals.
4.2 The Council formally approved the acceptance of schedules seen outside the meeting, with the exception of any queries which were brought to the meeting.
**General Issues**
4.4 In response to questions from members about the use of 40(2) alongside 27(1) in the context of harm to international relations through the release of derogatory comments, the Deputy Chair agreed to circulate to members some work done on the subject by the Working Group in 2017.
4.5 **ACTION:** The Deputy Chair agreed to circulate the 2017 Working Group guidance on derogatory comments to Council members.
**Outstanding Queries**
4.6 The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments, as more fully described in the attached annex to these minutes.
**Queries on closure and retentions schedules (November 2019)**
4.7 The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments, as more fully described in the attached annex to these minutes.
**Queries on closure and retention schedules (February 2020)**
4.8 The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments, subject to certain exceptions, which were either queried, withdrawn or carried over, as the relevant department had yet to respond, all as noted in the annex to these minutes.
**General**
4.9 A schedule of closure applications, together with a schedule of retention applications, was sent to members prior to the meeting. Members were asked to raise any queries within 10 days.
4.10 The Senior Access Manager collated the queries and a list of them was circulated with the papers for this meeting, with responses being provided where possible.
4.11 At the meeting, members were asked if they were content with the responses provided, whether in written form or orally. Where a response had not been provided, or members remained unhappy, the queries were carried forward.
4.12 The results of the Council’s deliberations have been set out in the annex to these minutes.
**At 13.10 the Council adjourned for LUNCH and resumed again at 14:00.**
5. **Forum of Historic Manuscripts and Academic Research Update**
5.1 The Deputy Chair, Hilary Bauer, provided a verbal update on the December Forum meeting and said it had:
- Received an interesting paper on Manorial Rolls; • Discussed its terms of reference and remained concerned that all its objectives were “advisory”; • Decided to look again at its agreed priority areas, in light of the skills audit; • Still felt that much good work was going on in collaboration with archive managers which, perhaps, members were unaware of, but might be able to assist i.e. keeping in close touch with the work of the TNA “Collections at Risk” team on charities and private archives. • Wished to receive reports from TNA on outcomes of various workstreams, grants awards and training sessions or conferences involving non-public archives so that the members could have an input; and • Agreed to keep an eye on “digital capability” issues and the assistance TNA was giving to those involved in non-public archives.
5.2 The Chief Executive and Keeper welcomed the support of the Forum in contributing to the development of policy and support for the sector.
5.3 The Chair welcomed the update and thanked the Forum members for their work.
5.4 ACTION: The Deputy Chair agreed to bring an update paper to the May Council meeting on the work of the Forum.
6. Administrative Matters
6.1 This section dealt with ongoing administrative and process matters which have arisen, largely from the ongoing work of the Working Group, but also from the September 2019 training session.
Section 46 Code of Practice Review
6.2 The Council was presented with the latest draft of the Section 46 Code of Practice of the Freedom of Information Act 2000 (FOIA), following review by the Working Group, which seeks, inter alia, to incorporate new procedures for dealing with absolute exemptions by the Council.
6.3 The Deputy Chair, for the benefit of the newer members, provided an update on the Council’s pursuit of a formal delegation from the Secretary of State in relation to Section 65 and 66.
6.4 The Head of Strategy Development outlined the timescale for the publication of the revised code of practice and said it was nearing the end of the drafting stage. The outstanding issues around S65 and S66 were with DCMS lawyers and the Cabinet Office. Once those issues were resolved, the draft code would then be subject to a 12 week public consultation before final review and publication.
6.5 ACTION: The Council asked to be kept updated on the legal position regarding S66.
Production of the Annual Report
6.6 The Council was presented with last year’s Annual Report and invited to review and suggest the lines on which further work should be undertaken to produce the 17th Annual Report, which would be presented at the May meeting for agreement.
6.7 ACTION: That the report include statistics on the number of requests the Council has dealt with and how many it has challenged. To highlight the membership changes, explain the Council’s objectives, state the health of the process and records system. The report should also include examples of where the FOI Panels have made a difference.
Website Updates 6.8 The Head of Governance provided a verbal update on changes made to the Advisory Council website pages. She reported the membership and register of interest pages were now up-to-date and she would be reviewing the terms of reference and the meeting summaries in the next few weeks.
6.9 **ACTION:** The Head of Governance to ensure the terms of reference and meeting summaries on the website were up-to-date.
**EU Exit Memorandum Update**
6.10 The Council received and noted an update on the delay to the revision of the Explanatory Memorandum on EU Exit.
6.11 **ACTION:** Cabinet Office to be asked to provide an update on the EU Exit Memorandum and Checklist at the next meeting.
**Tailored Review**
6.12 The Chief Executive and Keeper reported that the new Head of Governance will be leading on coordinating the Tailored Review on behalf of TNA and ACNRA. DCMS have confirmed both bodies will be reviewed together.
6.13 **ACTION:** The Head of Governance to keep Council members updated on the forthcoming DCMS Tailored Review.
7. **Departmental Retention Requests**
7.1 The Council considered papers from departments relating to the retention of records. In addition, a number of departments had provided updates, further to requests from members made at previous meetings.
7.2 **The outcome of its deliberations is set out below. Any resulting approval recommendations will then go forward to the Secretary of State.**
7.3 **ACTION:** The Head of Governance to write to departments to notify them of the Council’s recommendations, including any which will go forward to the Secretary of State with regard to their retention requests.
There were applications for retentions of between one and five years from the following departments:
- Cabinet Office
- Ministry of Justice
Due to an administrative error a Home Office retention request, for three years, was inadvertently missed off the agenda. The Deputy Chair agreed the request could be considered outside the meeting. The request was circulated to members and considered.
Updates were received from the following departments:
- Department for Education
- Ministry of Justice
Updates were also received from the following arm’s length bodies:
- Animal and Plant Health Agency
- Competition and Markets Authority
8. **FOI Panel Update**
8.1 The Council received a paper providing an overview of the issues and work undertaken by Panels, which included the most recent service statistics, the high volume of requests being handled by the FOI Centre, and notice of an online user experience survey which would be carried out in February/March 2020.
8.2 The paper also noted recent issues in relation to the application of Section 27(1) and 27(2) and Section 41 and guidance from the Foreign and Commonwealth Office (FCO) on this.
8.3 **ACTION:** The Head of the FOI Centre reported she would be updating guidance and wider materials for members in Egress.
8.4 **ACTION:** The Head of FOI Centre agreed to send Council members guidance on Section 41 – information provided in confidence.
8.5 **ACTION:** The Head of Governance/Deputy Chair to write to the FOC about the Council’s concerns on the inconsistent application of FOIA exemption 27(1) in addition to 27(2) or 41 and to seek their view on the principle.
8.6 **ACTION:** The Council requested to see examples of final refusal notices in relation to the application of the Public Interest Test.
8.7 The Chair thanked Panel members for their work.
9. **CEO’s Update**
9.1 The Chief Executive and Keeper introduced his update paper on current issues and ongoing matters.
9.2 In reference to the Surrey Police records removed from the Surrey History Centre, the Council noted that police records did not fall under the Public Records Act, but that some forces voluntarily deposit with their local archive. Some Metropolitan Police Service records were held at TNA due to historical governance arrangements. As a point of principle, the Chief Executive and Keeper said he would like to see police records managed in a way commensurate with the Public Records Act, but that this would have huge implications on police forces, TNA and the place of deposit network.
**Update on the document ordering service trial**
9.3 The Council received and noted a paper providing an update on TNA’s document ordering service trial which had generated media interest. The Keeper and Chief Executive provided reassurance that the vast majority of users will be unaffected by the changes, but would monitor if any groups were disproportionately affected.
9.4 **ACTION:** The Chief Executive and Keeper undertook to keep the Council, under its remit of ensuring access to information, updated and would present the findings of the document ordering service trial at its July or November meeting.
10. **Any Other Business**
10.1 The Head of Governance invited members for their thoughts on running paperless meetings to reduce waste. The Council generally agreed that it was helpful to have hardcopies of the schedules and a copy of the agenda frontsheets at meetings. 10.2 **ACTION:** Members requiring a full hardcopy set of the meeting papers should notify the Head of Governance individually.
10.3 It was noted that the Council’s Media Sub-committee had provided a statement to a BBC journalist on the Lord Denning/Profumo papers, however the Council had not been mentioned in the article.
10.4 **ACTION:** The Council agreed that the 2014 Jenkins Report on the Denning papers should be made available to members.
10.5 There being no further business, the meeting was closed at 15.00.
The next meeting of the Council will be held on **11 May 2020**, at TNA premises.
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81a7771a99ed6ee80ebd6495141ee6f3b12f56e3 | SUMMARY OF ACTIONS
Actions agreed at the meeting
**ACTION:** The Head of Governance to update the Actions Log with the items reported at the meeting.
**ACTION:** The Office of the Master of the Rolls and The National Archives will jointly contact the DCMS Legal and Arm’s Length Bodies Teams to pursue the matter of Section 66 delegation. **ACTION:** The National Archives to arrange a meeting between the Secretary of State and the Master of the Rolls.
**ACTION:** Deputy Chair to finalise amendments to the Annual Report in consultation with members out of Committee.
**ACTION:** The Head of Governance will write to departments to notify them of the Council’s recommendations, including any which will go forward to the Secretary of State with regard to their retention requests.
**ACTION:** The Head of Governance to circulate information on the Griggs method of reviewing files for preservation.
**ACTION:** Senior Access Manager to liaise with Cabinet Office regarding clarification in matters relating to the Royal Household.
**ACTION:** Head of Governance to ensure papers are quality checked before circulation.
**ACTION:** The FOI Manager will refer the case back to the Metropolitan Police.
**ACTION:** The FOI team to provide additional information in cases relating to S38, to clarify whether the age of the individual concerned is known or assumed.
______________________________________________________________________
1. **Welcome, introductions, apologies and declarations of interest**
1.1 The Chair welcomed everyone to the meeting.
1.2 There were no apologies for absence.
1.3 The Chair asked members to declare any conflicts of interest which they had identified in relation to the business of the meeting.
1.4 The following recusals applied:
1.4.1 The Master of the Rolls recused himself from discussion on matters regarding the Chagos Islands due to his involvement in a current legal matter, and from discussion on matters regarding the Ministry of Justice.
1.4.2 Mr Michael Smyth, as a lawyer with previous involvement in matters relating to the Chagos Islands, recused himself from any related discussion.
1.4.3 Lady Moira Andrews was a member of the Lord Chancellor’s Advisory Committee on Justices of the Peace and recused herself from discussion on the Ministry of Justice.
1.4.4 Mr Martin Uden, as a former Desk Officer with the Foreign & Commonwealth Office, recused himself from discussions relating to Japan.
1.4.5 Dr Helen Forde was a former Chair of Trustees of the Postal Museum and Archive and therefore declared an interest.
2. **Minutes and matters arising**
**Minutes of the meeting held on 10 February 2020**
2.1 The minutes of the meeting held on 10 February 2020 were approved as a correct record. Actions Log
2.2 The Chair went through the Actions Log and noted progress on the various open actions. The following updates were reported at the meeting:
**Action 80** – The Advisory Council agreed that this item was completed and should be closed. **Action 82** – The Advisory Council agreed that this item was completed and should be closed.
2.3 **ACTION:** the Head of Governance to update the Actions Log with the items reported at the meeting.
Update from Home Office on BS27
2.4 The Council received and noted an update paper from the Home Office following the submission of a retention application which was considered out-of-committee (with the recommendation it went forward to the Secretary of State) following the February meeting, for records in BS 27. The Council had asked a number of questions and was content with the responses provided.
Verbal Update on S46 Code of Practice
2.5 The Council was advised that the draft of the Section 46 Code of Practice had now been considered by Cabinet Office. A number of suggested amendments had been made and the Government Audience team at The National Archives was working with Cabinet Office on these. The revised draft will be brought back to the Working Group and Council for final scrutiny.
2.6 Lucy Fletcher advised that this matter was still a priority for The National Archives, and the challenge to conclude the work was not underestimated.
2.7 Following discussion on the delegation of Section 66 to formalise the work of the Council at the February meeting, it had been suggested that Section 69 of the Deregulation and Contracting Out Act 1994 might provide the clarity required for the Secretary of State to delegate this work.
2.8 The Office of the Master of the Rolls and The National Archives will contact the DCMS Legal and Arm’s Length Bodies teams to pursue this.
2.9 The Chairman suggested that it would be useful for him to meet with the Secretary of State to discuss the work of the Advisory Council and specifically the Code of Practice. The National Archives will liaise with DCMS to arrange a meeting.
**ACTION:** The Office of the Master of the Rolls and The National Archives will jointly contact the DCMS Legal and Arms Length Bodies to pursue the matter of Section 66 delegation.
**ACTION:** The National Archives to arrange a meeting between the Secretary of State and the Master of the Rolls.
3. **Ministry of Defence (MOD)**
Nuclear Records Review
3.1 Representatives from the Ministry of Defence joined the meeting to provide an update on a review of records owned by itself and the Nuclear Decommissioning Authority. 3.2 A previous update had been submitted to the February meeting, but the Council had asked for more detailed information regarding methodology, communications and timetabling.
3.3 The Council noted the report.
**Oral Update on Personnel Records**
3.4 Following discussion at the last meeting, Council received a brief update on progress with regard to the transfer of MoD Personnel records.
3.7 The Council noted the report and requested a further update at the November meeting.
NB: Some agenda items were taken out of order due to the availability of external guests joining remotely.
4. **Administrative Matters**
**Annual Report**
4.1 The Council reviewed the draft Annual Report for 2019-20, which would be appended to the report by The National Archives and laid before Government.
4.2 A few amendments had been suggested prior to the meeting, and one or two more at the meeting. The Deputy Chairman agreed to incorporate these into the text, in consultation with those who had proposed them, out of committee.
4.3 The Council approved the report, subject to the amendments.
4.4 The Chair thanked Trevor Woolley and Patricia Humphries for drafting the annual report.
**ACTION:** Deputy Chair to finalise amendments to the Annual Report in consultation with members out of Committee.
5. **Chief Executive Officer’s Report**
5.1 The Chief Executive and Keeper introduced his update paper on current issues and ongoing matters.
**Support for the Wider Archive Sector**
5.2 Council members were pleased to note the work being undertaken to support the protection of documentary heritage in businesses which were struggling or failing, especially during the current COVID-19 situation.
5.3 The Chief Executive explained that supporting the wider archive sector was a major focus of his remit as Historical Manuscripts Commissioner in addition to The National Archives’ position as a leadership body for archives. The importance of retaining archival records was discussed and the Council noted that engagement with the relevant departments was ongoing as well as continued contact with insolvency agencies and administrators.
**Impact of COVID-19**
5.4 The Chief Executive provided an update on a new temporary service offering free access to digital records during the closure period. The initial take up had been extremely high, with a 3,000% increase in digital downloads in the first few weeks. It was thought that the service would continue for a limited time once the archives opened again, as it was likely that there would be very limited onsite service for some time. 5.5 With regard to licencing terms, all licencing partners had been consulted, and the fair use terms had been refreshed. The service was being offered on a sign-up basis, with a limited number of downloads permitted each month.
5.6 The Chief Executive advised that the physical transfer of records to The National Archives had been suspended during the lockdown period. Some departments were able to carry out a very limited review of records and this was likely to have an impact on the schedules considered by the Council. There was also an increased risk of departments falling out of compliance. This had been discussed with ministers who had been made aware of the risks around compliance with the 20 year rule and the ability of the Council to fulfil its function.
5.7 It was likely that over the next few months, the size of schedules, especially those for closures, would be reduced, but the number of retention applications would increase.
6. **Foreign and Commonwealth Office**
**FCO Draft Checklist**
6.1 A representative from the Foreign and Commonwealth Office joined the meeting to discuss an updated FCO checklist of items not requiring explanation beyond elements required by the Council.
6.2 The Council were advised that the checklist now included the Explanatory Memoranda, which was being incorporated to improve understanding and save time for all parties.
6.3 Some minor changes had been suggested by members and these were discussed and agreed.
6.4 Council members were concerned that on occasion, where the checklist was referred to in the schedules, the department did not provide any additional explanation. It was confirmed referencing the checklist did not absolve the FCO from explaining why release of a record would be damaging to relations to another country in specific instances.
**Application of FOIA Exemptions 27**
6.5 Following discussion at the meeting in February, the Council had queried the application of FOIA exemption 27(1) in addition to 27(2) or 41 as appropriate in cases of records where the damage to international relations was argued to be not with the country which had sourced the information, but a third party. The Council was grateful for the FCO’s response, with which it was largely content, but noted that there were instances in the schedules where the reason for the damage to the third country was not specified, as it needed to be in such cases.
6.6 The Council thanked FCO for joining the meeting and for providing clear responses to a number of questions.
7. **Access to Records**
7.1 There were no further recusals received.
7.2 The Council formally approved the acceptance of schedules seen outside the meeting, with the exception of any queries which were brought to the meeting.
**Outstanding Queries** 7.3 The Council noted that many of the instances where responses to Council queries were being carried over was due to the current COVID-19 situation.
7.4 A schedule of closure applications, together with a schedule of retention applications, was sent to members prior to the meeting. Members had been asked to raise any queries within 10 days.
7.5 The Senior Access Manager collated the queries and a list of them was circulated with the papers for this meeting, with responses being provided where possible.
7.6 At the meeting, members were asked if they were content with the responses provided, whether in written form or orally. Where a response had not been provided, or members remained unhappy, the queries were carried forward.
7.7 The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments, as more fully described in the attached annex to these minutes.
Queries on closure and retentions schedules (February 2020)
7.8 The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments, as more fully described in the attached annex to these minutes.
Queries on closure and retentions schedules (May 2020)
7.9 The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments, subject to certain exceptions, which were either queried, withdrawn or carried over, as the relevant department had yet to respond, all as noted in the annex to these minutes.
Queries on absolutes, comments and typographical errors (May 2020)
7.10 Council members asked whether it would be possible for applications regarding the Royal Household to clarify whether the record related to the Monarch or a member of the Royal Family. The Senior Access Manager agreed to liaise with Cabinet Office.
ACTION: Senior Access Manager to liaise with Cabinet Office regarding clarification in matters relating to the Royal Household.
At 13.05 the Council adjourned for LUNCH and resumed again at 13.30
8. Update on the Forum on Historical Manuscripts and Academic Research
8.1 The Deputy Chair, Hillary Bauer, provided a verbal update on the Forum meeting held at the beginning of March. A number of interesting topics had been discussed, including:
- The COVID-19 situation, particularly with reference to the impact on the wider archive sector
- The proposed document ordering trial at The National Archives
- Records at Risk
- The Skills Audit being undertaken for Forum members
- Plans for the 100th anniversary of the Manorial Document Register in 2022
8.2. The Council was advised that the meeting had been the last to be attended by Lesley Ferguson who is due to retire in September 2020 and a vote of thanks had been recorded for her valued contribution to the Forum. Council members also expressed their thanks and appreciation. The meeting had also welcomed Leon Litvack as a new member of the Forum. 8.3 Council members made a number of suggestions regarding the plans for the Manorial Documents Register anniversary, which were welcomed and would be considered. The Chair advised that 2022 was also the 100th anniversary of the 1922 Law Property Act and suggested there might be an opportunity for a joint event which could perhaps take place in the Law Courts, given the especial importance of the 1922 Law of Property Act in the history of legislation.
9. **Departmental Retention Requests**
9.1 The Council considered papers from departments relating to the retention of records. In addition, a number of departments had provided updates, further to requests from members made at previous meetings.
9.2 The Council’s decisions made in respect of each paper has been noted below. Any resulting approval recommendations will then go forward to the Secretary of State.
**ACTION:** The Head of Governance will write to departments to notify them of the Council’s recommendations, including any which will go forward to the Secretary of State with regard to their retention requests.
There were applications for retentions of between one and two years from the following departments:
- Ministry of Defence
- Attorney General’s Office
- Department for Education
- Department for Environment, Food and Rural Affairs
There were applications for retentions of between one and two years from the following arm’s length bodies:
- Companies House
- Historic England
- Health and Safety Executive
- Metropolitan Police
- Office for National Statistics
- Serious Fraud Office
- UK Debt Management Office
There were applications for retentions of between one and five years from the following places of deposit:
- British Library
- Royal Botanic Gardens Kew
- Postal Museum and Archive
- Tate
Updates were received from the following departments:
- Ministry of Justice
- Foreign and Commonwealth Office
- Home Office
- Ministry of Housing, Communities and Local Government
Updates were received from the following arm’s length bodies: 10. **FOI Panel Update**
10.1 The Council received a paper providing an overview of the issues and work undertaken by Panels, which included the most recent service statistics and the high volume of requests being handled by the FOI Centre, and responded to a number of matters raised by Panel members.
10.2 It was noted that there continued to be a number of queries regarding the quality of the applications, specifically lack of clarity (including in relation to assumed ages of individuals in S38 cases) and grammatical errors.
10.3 The Council discussed a specific panel case where the panel had not been able to reach an agreement over the application of Section 31. It was suggested that the sub-section applied was not correct, which was resulting in a very confusing explanation for keeping the record closed due to the case still being considered open.
10.4 Whilst the Council agreed that it was not their responsibility to define what an open case should be, there was justification in requesting more detail on how opening the file might prejudice further investigations, given that those responsible for the crime had been convicted.
**ACTION:** The FOI Manager will refer the case back to the Metropolitan Police.
**ACTION:** The FOI team to provide additional information in cases relating to S38, to clarify whether the age of the individual concerned is known or assumed.
10.5 The Chair thanked Panel members and the FOI team for their work.
11. **Any Other Business**
11.1 The Chair thanked The National Archives for arranging and hosting the first meeting of the Council by video link. Council members agreed that whilst the circumstances were unusual, the meeting had been very successful.
**There being no further business, the meeting was closed at 15.00pm.**
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eada79aad5c334ad4ea3a808ad68336837e9471c | 1. Welcome, introductions, apologies and declarations of interest
1.1 The Chair welcomed everyone to the meeting.
1.2 There were no apologies for absence. 1.3 The Chair asked members to declare any conflicts of interest which they had identified in relation to the business of the meeting.
1.4 The following recusals applied:
1.4.1 The Master of the Rolls recused himself from discussion on matters regarding the Chagos Islands due to his involvement in a current legal matter, and from discussion on matters regarding the Ministry of Justice.
1.4.2 Mr Michael Smyth, as a lawyer with previous involvement in matters relating to the Chagos Islands, recused himself from any related discussion.
1.4.3 Lady Moira Andrews was a member of the Lord Chancellor’s Advisory Committee on Justices of the Peace and recused herself from discussion on the Ministry of Justice.
1.4.4 Mr Martin Uden, as a former Desk Officer with the Foreign & Commonwealth Office, recused himself from discussions relating to Japan.
2. Minutes and matters arising
Minutes of the meeting held on 11 May 2020
2.1 Subject to minor amendments, the minutes of the meeting held on 11 May 2020 were approved as a correct record.
Actions Log
2.2 The Action Log was noted, with the following actions marked as completed:
Action 69 - Action 83 - Action 84 - Action 85 – Action 86 – Action 88 – Action 89 - Action 90 – Action 91 – Action 92
ACTION: the Head of Governance to update the Actions Log with the items reported at the meeting.
NB – Some agenda items were taken out of order due to the availability of external guests joining remotely.
3. Update on the Forum on Historical Manuscripts and Academic Research
3.1 The Deputy Chair, Hillary Bauer, provided a brief update. No meeting had been held since the last Advisory Council, but the next meeting will be on 29th July and will take place by video link. Items for discussion at that meeting will include the effects of COVID-19 across the archives sector, issues around recent cases of private owners withdrawing records from local offices to sell at auction, and the Manorial Documents Register anniversary. There will also be an update on the work and responsibilities of places of deposit.
4. Verbal Update on Government Information Management Landscape – COVID-19
4.1 Lucy Fletcher, Director for Government and Information Rights at The National Archives, gave a brief update on the current situation and how it was affecting the record selection, review and transfer process across Government. 4.2 The National Archives had continued to support Government departments where possible, providing access to original records where safe to do so for specific issues, including government response to COVID-19, public inquiries etc.
4.3 The team had led remote engagement with departments, Arm’s Length Bodies and Places of Deposit to understand where compliance with the 20 year rule is under pressure. The impact of the pandemic is still being realised and although steps are being taken to return to work, staff access and social distancing issues, especially in older buildings, are contributing to continued delays. The majority of the work on sensitivity reviewing has also stalled, partly due to the demographic of colleagues involved in this work.
4.4 However, discussions have been taking place with departments and bodies to explore shared service offers and other models of service delivery through the use of the Crown Commercial Services framework.
4.5 Council members were advised that once work finally resumes, it was likely departments’ selection decisions would result in more applications for closure due to the backlog caused by the COVID-19 situation. The volume of digital information selected is also likely to increase, which will almost certainly result in a rise in closure applications.
4.6 Council was reassured to note that considerable efforts were being made to adapt current plans in order to ensure compliance wherever possible, and there was no evidence at all that departments may be looking to use the current situation to delay transfers.
5. **HM Treasury (HMT)**
5.1 John Nelstrop from HMT Treasury joined the meeting to discuss written updates on work relating to the annual release programme previously agreed with the Council. (Paper 7.1.2 July 2019: RI 137 – Paper 8.1.10 November 2019: RI 134)
5.2 Members were reassured to note that good progress on paper records had been made before the current lockdown situation and it was hoped that records which were already prepared for transfer could start to be transferred to The National Archives within the next few weeks. However it was acknowledged that there would be an impact on the amount of work which could be completed before the end of the year.
5.3 With regard to digital records, collaboration with the Foreign & Commonwealth Office (FCO) to identify whether the system they had developed could be adapted for the digital review of Treasury records was going well, and a feasibility study was about to start. It was anticipated that a decision on whether the FCO system was suitable could be made at the end of the year.
5.4 **DECISION:** The Council thanked Mr Nelstrop for joining the meeting.
6. **Metropolitan Police**
6.1 Mr David Capus from the Metropolitan Police Service joined the meeting to provide an update on their records transfer programme, following a written report to the council meeting in May. (Paper 6.3.3 May 2019: RI136)
6.2 The Council was concerned that agreed targets for the transfer of records was unlikely to be met due to an apparent lack of urgency to resolve issues. Mr Capus advised that three additional staff posts had recently been filled and it was hoped they would be able to commence work within the next few weeks, once staff were able to access the building again. 6.3 Staff had been able to carry out some work remotely using the record management system to carry out high level selection. Records stored offsite were due to be delivered as soon as staff were back, when a more detailed review could be undertaken.
6.4 Whilst the Council was supportive of the efforts made by the team, it felt that anticipated funding cuts and a lack of high level support could see the work fall further behind.
6.5 The Council thanked Mr Capus for joining the meeting and for his comprehensive report.
6.6 The Council noted that the Strategic Compliance team at The National Archives was working to establish regular support sessions with the Metropolitan Police.
7. **Access to Records**
7.1 There were no further recusals received.
7.2 The Council formally approved the acceptance of schedules seen outside the meeting, with the exception of any queries which were brought to the meeting.
**Outstanding Queries**
7.3 The Council noted that many of the instances where responses to Council queries were being carried over was due to the current COVID19 situation.
7.4 A schedule of closure applications, together with a schedule of retention applications, was sent to members prior to the meeting. Members had been asked to raise any queries within 10 days.
7.5 The Senior Access Manager collated the queries and a list of them was circulated with the papers for this meeting, with responses being provided where possible.
7.6 At the meeting, members were asked if they were content with the responses provided, whether in written form or orally. Where a response had not been provided, or members remained unhappy, the queries were carried forward.
7.7 The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments, as more fully described in the attached annex to these minutes.
**Queries on closure and retentions schedules (May 2020)**
7.8 The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments, as more fully described in the attached annex to these minutes.
**Queries on closure and retentions schedules (July 2020)**
7.9 The Council was content to approve the applications on the basis of the clarification or additional information provided by the departments, subject to certain exceptions, which were either queried, withdrawn or carried over, as the relevant department had yet to respond, all as noted in the annex to these minutes.
**Queries on absolutes, comments and typographical errors (July 2020)**
7.10 The Council noted the amendments made, clarification or additional information provided.
**General Matters** 7.11 Council members raised issues about the level of its exposure to the detail of derogatory comments supporting S27(1) exemption applications, especially where the FCO checklist was cited; the level of detail accompanying S27(2); and the basis for making a public interest judgement under S37. It was agreed that The National Archives should draft papers discussing these issues for discussion at the September training day.
**ACTION:** The National Archives to draft papers on the issues for discussion at the September training meeting.
8. **Verbal Update on S46 Code of Practice and S66**
8.1 The Deputy Chair provided a brief background on the issues surrounding S46 and S65/66. Discussions had commenced with government in 2016 as the Council had concerns about whether some aspects of its operation were consistent with statute.
8.2 In respect of the Review of the S46 Code of Practice, the Council was advised that the Steering Committee has agreed a draft, which will be put forward to DCMS Legal prior to being submitted to the Secretary of State for clearance. The Secretary of State will then seek formal approval from the Minister for the Cabinet Office, the Information Commissioner and the relevant Northern Ireland Minister. If approved, the draft Code will be issued for public consultation.
8.3 The Chair advised that he was meeting with the DCMS Minister later in the week, and these issues would be discussed.
9. **Departmental Retention Requests**
9.1 The Council considered papers from departments relating to the retention of records. In addition, a number of departments had provided updates, further to requests from members made at previous meetings.
9.2 The Council’s decisions made in respect of each paper has been noted below. Any resulting approval recommendations will then go forward to the Secretary of State.
**ACTION:** The Head of Governance will write to departments to notify them of the Council’s recommendations, including any which will go forward to the Secretary of State with regard to their retention requests.
There were applications for retentions of one year from the following departments:
- Attorney General’s Office
There were applications for retentions of one year from the following arm’s length bodies:
- Ofsted
- ACAS
- Privy Council Office
- UK Export Finance
- Permanent Committee on Geographic Names
- Food Standards Agency
Updates were received from the following departments:
- Her Majesty’s Revenue & Customs
- Department of Education
Updates were received from the following arm’s length bodies: 10. **Freedom of Information (FOI) Panel Update**
10.1 The Council received a paper providing an overview of the issues and work undertaken by Panels, which included the most recent service statistics, and responded to a number of matters raised by Panel members.
10.2 The FOI Manager advised that fewer FOI requests had been received over the last two months, but these were now steadily increasing, and the team had had to adopt new working patterns, especially with regard to the FOI review practices, due to the inability to access the building and consult original records. This had led to some backlog but it was hoped that staff would be able to return to the building in a limited manner in the next few weeks.
10.3 The Chair thanked Panel members and the FOI team for their work.
11. **Chief Executive Officer’s Report**
11.1 The Chief Executive and Keeper introduced his update paper on current issues and ongoing matters.
**Archives Sector**
11.2 Council members were pleased to note the amount of support that The National Archives had continued to provide the archive sector during the COVID-19 pandemic.
11.3 The free ‘Novice to Know-How’ digital learning programme for practitioners, developed in partnership with the Digital Preservation Coalition (DPC) had been over-subscribed three times and work on modelling digital preservation risk was also being shared through the DPC. Two workshops had sold out and a third was being organised.
**Legislation Services**
11.4 The National Archives had continued to ensure that new legislation was registered and publishing rapidly and that amendments to affected legislation were swiftly incorporated throughout the lockdown period. New Statutory Instruments were registered and published on a Sunday, three Sundays in succession and up to date texts were available on the website within hours of the legislation being made.
11.5 The Council was very pleased to note the continued success and hard work being undertaken by the team and recorded a note of thanks to The National Archives.
**Government and Information Rights**
11.6 Council members queried the background behind a Written Ministerial Statement by the Chancellor of the Duchy of Lancaster and Minister for the Cabinet Office which was being laid. The statement concerned the Cabinet Office’s ability to transfer specific records to The National Archives by the end of the calendar year, as agreed, due to impact of COVID-19.
11.7 The Council was advised that the records from Cabinet Office were released to the media in a biannual press release event, with the next due in July, and despite expectation that this would still go ahead, it was felt important to clarify the position. There were no plans to reduce momentum on adherence to the 20 year rule, and the statement was not relevant for other departments. 11.8 The Council was pleased to note that plans to re-open The National Archives to a limited number of visitors were being finalised and felt that the guidance which had been published on the website was very helpful.
12. **Any Other Business**
12.1 The Master of the Rolls advised that he would be retiring from his role at the end of the year and the meeting in November would be his last. It was hoped that his successor would be announced soon, and would be invited to the November meeting.
There being no further business, the meeting was closed at 15.00pm.
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3c2838ca97f57e602b3881de58e5f332ace5b2b2 | 1. Welcome, introductions, apologies and declarations of interest
1.1 The Chair welcomed everyone to the meeting.
1.2 The Chair introduced Isabel Saunders to members as the new secretary to the Advisory Council on National Records and Archives. 1.3 Apologies for absence were received from, Jeff James Lucy Fletcher deputised for him.
1.4 The Chair confirmed there was no need for members to declare any conflicts of interest given the business of the meeting was training.
2. **Update on S.65 and S.66 of the FOIA**
2.1 The Deputy Chair provided a brief verbal summary covering the history of the S.65 and S.66, including the key concerns of the Governance Working Group.
2.2 DCMS indicated that the arrangements now being worked up were interim ones, and that as such there was no immediate proposal to extend the role of the Council to advice under S.66 though this might be considered in the slightly longer term. There would be ongoing liaison with the Advisory Council on this matter.
2.3 Lucy Fletcher updated members on the Code of Practice, noting reference to S.65 and S.66 would be removed from the Code on the advice of DCMS Legal, whilst awaiting clarity. On behalf of TNA she emphasised the importance of any solution ensuring TNA is able to comply with FOI deadlines.
2.4 The Master of the Rolls thanked Alex Howell for attending and stressed the urgency of a resolution to this matter.
3. **Chief Executive Officer’s Report**
3.1 Lucy Fletcher introduced the Chief Executive and Keeper’s update paper on current issues and ongoing matters.
**Swedish School**
3.2 This initiative was part of the wider Archives for Everyone vision, as well as contributing commercially to TNA. TNA regularly collaborates with higher education institutions and this initiative continues with that, by offering an opportunity to have a permanent base for an education facility on site. The space being used was a conference wing, and no repository space was being lost.
**20-Year Rule**
3.3 Confidence was low that departments would meet the policy intention of the 20-year rule, but this had been the case for a number of years and this message had been given to the Secretary of State. Overall however, there was a healthy compliance and TNA had worked with departments so they could legally retain their records.
3.4 With regard to the resumption of transfers to TNA over 2,000 records had been received in the first two weeks, with a focus on the Foreign Office, Cabinet Office and Treasury. The overall picture was pleasing and the government reading room was booked until the end of October.
**Code of Practice**
3.5 The Chair of the Governance Working Group requested a copy of the draft ministerial submission and the Code of Practice for the Working Group to ensure the Council’s interests are properly covered. Lucy Fletcher agreed to share the draft and suggested it may be appropriate for the Council to make their own submission if it had a different view. **ACTION:** Lucy Fletcher to share a copy of the ministerial submission and Code of Practice with the Governance Working Group.
4. **Public Minutes for the Website**
**Public Minutes of the meeting held on 18 November 2019**
4.1 The public copy of the minutes of the meeting held on 18 November 2019 were approved for the website.
**Public Minutes of the meeting held on 10 February 2020**
4.2 The public copy of the minutes of the meeting held on 10 February 2020 were approved for the website.
**Public Minutes of the meeting held on 11 May 2020**
4.3 The public copy of the minutes of the meeting held on 11 May 2020 were approved for the website.
**ACTION:** The Secretary to the Advisory Council to publish the approved public minutes on the website.
5. **Any Other Business**
5.1 The Chair gave his apologies and noted the Deputy Chair would be chairing the remainder of the meeting.
5.2 The Chair noted he would bring Sir Geoffrey Vos, the incoming Master of the Rolls, to the November meeting of the Council.
6. **Access of Transfer Process**
6.1 Members of the Council received a short presentation on the access of transfer process as it relates to closure periods, redactions and how checklists translate into closure entries.
**ACTION:** Victoria Davis to provide more information on how the public interest test under S37 (1)(ac) and 37 (1)(ad) could be exercised by the Council on the basis of the information made available to the Council.
7. **Foreign and Commonwealth Office Memorandum and Checklist**
7.1 Members of the Council received a short presentation on the FCO Memorandum and Checklist, including guidance on S.27 (i) and S.27 (ii).
**ACTION:** Victoria Davis to engage with FCO on providing additional material on the content of ‘derogatory comments’ in S.27 (i) cases to help members reach an opinion on the balance of public interest.
8. **Information in the Public Domain**
8.1 Members of the Council received a short presentation on information in the public domain, covering how information in the public domain can affect the outcome of an FOI request.
9. **Presentation on Transfer of Digital Records**
9.1 Members of the Council received a presentation on the transfer of digital records, covering the introduction of a new transfer of digital records product, why this is being built, an overview of the Closure Exposure and how an Explore phase works.
9.2 Members were also given the opportunity to feed their opinions back to TNA.
*There being no further business, the meeting was closed at 16.11pm.*
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d823036dc734f2d7d7dac020222549648b11625c | Section 1 Structural and Equipment Requirements
Conditional approval can only be granted to establishments which have demonstrated they meet the structural and equipment for the activities to be conducted.
The Food Standards Agency can help identify any issues you may have which will compromise your ability to meet the following basic requirements
Section 1.1 Basic hygiene requirements taken from Regulation (EC) No 852/2004
All Premises
Clean premises in good repair.
Size, layout, design, construction & siting must:
(a) Allow maintenance, cleaning, and/or disinfection; Avoid or minimise air borne contamination; Provide adequate working space.
(b) Protect against accumulation of dirt, shedding of particles into food and formation of condensation or “undesirable” mould;
(c) Permit Good Hygiene Practices – particular reference to pest control.
(d) Where necessary, provide suitable temp. Controlled handling conditions of sufficient capacity designed to allow temps to be monitored and, where necessary, recorded.
Adequate no. of flush lavatories connected to effective drainage system. Lavatories must not open directly into food rooms.
Adequate no. of wash hand basins suitably located. Hot & cold running water, cleaning materials and material for hygienic drying of hands.
Sufficient and suitable means of natural or mechanical ventilation. Mechanical systems must be readily accessible. Airflow from a contaminated area to a clean area to be avoided.
Sanitary conveniences to be ventilated (natural or mechanical).
Adequate natural and/or artificial lighting.
Drainage facilities to be adequate for purpose, designed and constructed to avoid risk of contamination. Drainage must ensure that waste does not flow from a contaminated to a clean area.
Where necessary – adequate changing facilities.
Separate storage for cleaning agents/disinfectants from food handling areas.
Specific Requirements in Food Preparation Areas
Design and layout must permit Good Hygiene Practices and protection against contamination. In particular:
(a) Floor surfaces must be sound and easy to clean. Must use impervious, non-absorbent, washable, non-toxic materials (unless etc.). Where appropriate, adequate surface drainage necessary. (b) Sound walls, easy to clean and disinfect. Smooth surface to appropriate height using impervious, non-absorbent, washable and non-toxic materials.
(c) Ceilings and overhead fixtures or interior of roof to be constructed and finished to prevent accumulation of dirt, reduce condensation and growth of undesirable mould and particle shedding.
(d) Windows and other openings to be constructed to prevent accumulation of dirt. Windows opening to exterior fitted with screens which can be removed for cleaning.
(e) Easily cleaned doors – smooth, non-absorbent surfaces.
(f) Surfaces and equipment in contact with food to be maintained in sound condition and be easy to clean.
Adequate facilities for cleaning, disinfecting and storage of tools and equipment. Facilities to be constructed of corrosion-resistant materials, be easy to clean, and have adequate hot and cold water supply.
**Equipment Requirements**
All articles, fittings and equipment contacting food must:-
(a) Be effectively cleaned and, where necessary, disinfected. Such cleansing & disinfection to take place at a frequency sufficient to avoid risk of contamination.
(b) Be so constructed of such materials and be kept in such good order, repair and condition as to minimise any risk of contamination.
(c) With the exception of non-returnable containers and packaging – be so constructed, be of such materials and be kept in such good order etc. – as to enable them to be kept clean and, where necessary, disinfected.
(d) Be installed in such a manner as to allow adequate cleaning of the equipment and the surrounding area.
**Section 1.2 Hygiene Requirements taken from Regulation (EC) No 853/2004**
**Slaughterhouses – Meat from Domestic Ungulates (Red Meat) and Meat of Farmed Game**
(a) Slaughterhouses must have adequate and hygienic lairage facilities or, climate permitting, waiting pens that are easy to clean and disinfect. Equipment must include watering and, if necessary, feeding facilities. Drainage of waste water must not compromise food safety.
(b) They must have separate lockable facilities or, climate permitting, pens for sick or suspect animals with separate drainage, and sited to avoid contamination of other animals – unless the competent authority considers such facilities unnecessary. (c) Size of lairage must ensure welfare is respected. Layout must facilitate ante-mortem inspections, including identification of animals or groups of animals.
To avoid contaminating meat, slaughterhouses must:-
(a) Have a sufficient number of rooms appropriate to operations being carried out.
(b) Have a separate room for emptying and cleaning stomachs and intestines unless the Competent Authority authorises time separation of these operations in a specific slaughterhouse on a case-by-case basis.
(c) Ensure separation in space or time of:-
(i) Stunning and bleeding; (ii) In the case of pigs – scalding, depilation, scraping and singeing; (iii) Evisceration and further dressing; (iv) Handling clean guts and tripe; (v) Preparation and cleaning of other offal, particularly the handling of skinned heads if it does not take place at the slaughterline; (vi) Offal packing; (vii) Dispatching meat.
(d) Have installations that prevent contact between the meat and the floors, walls and fixtures.
(e) Have lines (where operated) that are designed to allow constant progress of the process and to avoid cross-contamination between different parts of the line.
Where more than one line is operated in the same premises, there must be adequate separation of the lines to prevent cross-contamination.
They must have facilities for disinfecting tools with hot water at not less that 82°C OR an alternative system having equivalent effect.
Equipment for hand washing by staff handling exposed meat must have taps designed to prevent the spread of contamination.
There must be lockable facilities for the refrigerated storage of detained meat and separate closable, lockable and cleanable facilities for storage of unfit meat.
There must be a separate place with appropriate facilities for cleaning, washing and disinfection of livestock vehicles. However, slaughterhouses need not have these places and facilities if the Competent Authority so permits, and official authorised places and facilities exist nearby.
They must have lockable casualty slaughter facilities – unless this slaughter takes place elsewhere in other establishments authorised by the Competent Authority, OR at the end of the normal slaughter period. If manure or digestive tract contents are stored, there must be a special place or area for that.
They must have an adequately equipped lockable facility OR, where needed, a room for the exclusive use of the veterinary service.
**Slaughterhouses – Meat from Poultry & Lagomorphs (White meat) and Meat of Farmed Game (Birds)**
Slaughterhouses must have a room or covered space to the reception of the animals and for their inspection before slaughter.
To avoid contaminating meat, they must:-
(a) Have a sufficient number of rooms, appropriate to the operations being carried out;
(b) Have a separate room for evisceration and further dressing, including the addition of seasonings to whole poultry carcases – unless the Competent Authority authorises separation in time of these operations within a specific slaughterhouse on a case-by-case basis.
(c) Ensure separation in space or time of the following operations:-
(i) Stunning and bleeding;
(ii) Plucking or skinning, and any scalding;
(iii) Dispatching meat.
(d) Have installations that prevent contact between the meat and the floors, walls and fixtures;
(e) Have slaughterlines (where operated) that are designed to allow a constant progress of the process and to avoid cross contamination between the different parts of the line. Where more than one line is operated in the premises, there must be adequate separation of the lines to avoid cross contamination.
They must have facilities for disinfecting tools with hot water at not less than 82°C or an alternative system having equivalent effect.
Equipment for hand washing by staff handling exposed meat must have taps designed to prevent the spread of contamination.
There must be lockable facilities for the refrigerated storage of detained meat and separate closable, lockable and cleanable facilities for the storage of unfit meat.
There must be a separate place with appropriate facilities for the cleaning, washing and disinfection of:-
(f) Transport equipment such as crates;
(g) Livestock vehicles.
These places and facilities are not compulsory for (b) if officially authorised places and facilities exist nearby.
They must have an adequately equipped lockable facility or, where needed, room for the exclusive use of the veterinary service. Cutting Premises – Meat from Domestic Ungulates (Red Meat), Meat of Farmed Game and Wild Game Meat
Plants are constructed so as to avoid contamination of meat – in particular by:-
(a) Allowing constant progress of operations,
OR
(b) Ensuring separation between the different production batches.
Have separate rooms for storage of packaged and exposed meat – unless stored at different times or in such a way that the packaging material and the manner of storage cannot be a source of contamination.
Have cutting rooms equipped to ensure compliance with Annex III, Section I, Chapter V, eg.
Work on meat must be organised to prevent or minimise contamination. In particular, operators must ensure that:-
(a) Meat intended for cutting is brought into workrooms progressively as needed;
(b) During cutting, boning, trimming, slicing, dicing, wrapping and packaging, the meat is maintained at not more than 3°C for offal and 7°C for other meat by means of an ambient temp. of not more than 12°C OR an alternative system having an equivalent effect;
(c) Where premises are approved for cutting meat of different spp., precautions are taken to avoid cross contamination, where necessary by separation of the operations on the different spp. in either space or time.
Have wash hand basins with taps designed to prevent spread contamination for staff handling exposed meat.
Have hot water sterilisers operating at not less than 82°C OR an alternative system having an equivalent effect.
Cutting Premises – Meat from Poultry & Lagomorphs (White meat), Meat of Farmed Game and Wild Game Meat
Plants are constructed so as to avoid contamination of meat – in particular by:-
(a) Allowing constant progress of operators, OR
(b) Ensuring separation between the different production batches.
(c) Have separate rooms for storage of packaged and exposed meat – unless stored at different times or in such a way that the packaging material and the manner of storage cannot be a source of contamination.
Have cutting rooms equipped to ensure compliance with the requirements laid down in Annex III, Section II, Chapter V of 853. Eg. Work on meat must be organised to prevent or minimise contamination. In particular, operators must ensure that:-
(a) Meat intended for cutting is brought into the workrooms progressively as needed; (b) During cutting, boning, trimming, slicing, dicing, wrapping and packaging, the meat is maintained at not more than 4°C by means of an ambient temp of not more that 12°C OR an alternative system having an equivalent effect.
(c) Where premises are approved for the cutting of different animal species, precautions are taken to avoid cross-contamination, where necessary by separation of the operations on the different species in either space or time.
Meat may be boned and cut prior to reaching 4°C when slaughterhouse and cutting premises are on the same site providing it is transferred to the cutting room either:-
(a) Directly from the slaughter premises, OR (b) After a period in a chiller.
In such cases meat must be chilled to 4°C as soon as it is cut and where appropriate packaged.
Exposed meat must be stored and transported separately from packaged meat – unless stored or transported at different times or in such a way that the packaging material and the manner of storage or transport cannot be a source of contamination.
Have wash hand basins used by staff handling exposed meat with taps designed to prevent spread of contamination.
Have hot water sterilisers operating at not less than 82°C OR an equivalent system having an equivalent effect.
If delayed evisceration or evisceration of “foie gras” geese or ducks stunned, bled and plucked on farm takes place – the cutting premises must have separate rooms which are available for that purpose.
Section 1.3 CCTV Requirements for slaughterhouses detailed in the Mandatory Use of Closed Circuit Television in Slaughterhouses (England) Regulations 2018
All slaughterhouses in England are now required to install a CCTV system that provides a complete and clear image of killing and related operations in all areas of the slaughterhouse where live animals are present.
The business operator must ensure the CCTV system is capable of producing images and information for inspection and seizure without interrupting the operation of the system; and is capable of processing images and information of the same quality as the original images and information.
The business operator must ensure that the CCTV system is operational and kept in good working order at all times when live animals are present at the slaughterhouse. Section 2 Food Safety Management System
In order to help demonstrate that your proposed operating procedure does not pose a risk to public health the Agency can advise on the considerations you need to be making in regard to your Food Safety Management System based on HACCP based procedures.
A full set of pre-requisite programmes (HACCP Good Hygiene Practices) will be needed to establish the basic hygiene conditions necessary for the proper implementation of a food safety management system based on HACCP principles. You can insult the Meat Industry Guide for full details and model documents to assist you further.
During the application process the food business operator will need to provide documented evidence to demonstrate how the following requirements have been met.
Water Testing A water distribution plan of the premises showing the point of water entry and the pipework distribution is required with all outlets numbered for identification. Microbiological test results and physicochemical analysis test results on the water used in the establishment are required prior to conditional approval being granted.
Pest Control A pest control bait plan is required along with the records of checks performed and details of any rodenticides/pesticides used (Safety data sheets). Further information is available in the MIG. All external openings must be pest proofed and evidence of annual changes of any UV bulbs/tubes used in electronic fly killers must be provided.
Staff Health Checks Some form of return to work following illness procedure and initial health screening procedure for staff and visitors is required. Records must be maintained.
Establishment cleaning Cleaning schedules giving details of cleaning procedures and the results of checks on the efficacy of cleaning (including any microbiological checks) are required.
Details of Operating Procedures Operating procedures are required giving details of how operational procedures are carried out and how the good hygiene practices programmes will provide the basic conditions of hygiene within the establishment.
Documented HACCP based procedures must be developed and implemented for all products that are based on the 7 HACCP principles. See the MIG for further details. Section 3 Animal Welfare All slaughterhouses need to have procedures in place which safeguard the welfare of animals in lairage and up to the point of slaughter.
Welfare requirements are detailed in Council Regulation (EC) No 1099/2009, the Welfare of Animal at the Time of Killing (England) Regulations 2015 and Welfare of Animal at the Time of Killing (Wales) Regulations 2014.
Business operators or any person involved in the killing of animals should take the necessary measures to avoid pain and minimise the distress and suffering of animals during the slaughtering or killing process, taking into account the best practices in the field and the methods permitted. The Agency will be able to explain the welfare requirements detailed in these regulations and the process for obtaining the required certificates of competence for your activities and
What the advisory visit will not include The Agency are unable to recommend specific brands of equipment or products required for your operations.
The Agency will not assume the responsibility for designing the layout of your premises.
For more tailored advisory support it may be beneficial for you to instead engage with an independent industry consultant in your area who can provide a more in-depth support role to advise on how you can run your food business in compliance with the relevant hygiene and animal welfare requirements.
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295e46e369b6ceb3f0f1a1c29df694310cd21e36 | THE SUSTAINABILITY OF MEAT AND CURED MEATS IN ITALY
Prof. Ettore CAPRI Research center on sustainable development (OPERA) Università del Sacro Cuore – Italy [email protected] THE 5 ASPECTS OF MEAT SUSTAINABILITY ECONOMIC VALUE OF THE MEAT SECTOR IN ITALY
DATA IN BILLION € PER YEAR
GDP 1,500 billion €
AGRICULTURAL 45 billion €
AGRIBUSINESS 180 billion €
ADDED VALUE
INDUSTRY OF MEAT AND CURED MEATS
TOTAL 20 billion €
POULTRY 6 mld €
PORK 8 mld €
BEEF 6 mld €
LIVESTOCK ENTERPRISES
TOTAL 10 billion €
POULTRY 4 mld €
PORK 2 mld €
BEEF 4 mld € MEAT TRACEABILITY: MAIN CONTROLS CARRIED OUT
- **Feed Production**: Control of accompanying documentation. Analysis on raw materials and/or on the food.
- **Breeding**: Control of veterinary therapies. Compliance with animal welfare standards.
- **Slaughtering**: Monitoring of compliance with health standards and animal welfare.
- **Processing**: Monitoring temperature compliance. Quality control of the product.
- **Distribution**: Traceability. MEDITERRANEAN DIET: ALL THE FOODS, RIGHT QUANTITIES **Nutrients of Meat**
**Vitamin A**
- Essential for the skin, eyesight, healing, growth and immune defence (present in the liver)
**Vitamin Group B**
- (B1, B2, B6)
- To use the energy from carbohydrates, protein and fat, essential for growth
**Vitamin B12**
- Essential for the formation of red blood cells and the proper functioning of the nervous system
**Vitamin D**
- Necessary for bone formation, it promotes the absorption of calcium (present in the liver)
**Vitamin PP**
- Involved in the transformation of energy and glycogen synthesis
**Vitamin K**
- Essential for blood clotting
**Pantothenic Acid**
- Essential in the metabolism of carbohydrates, proteins and fats and for the synthesis of vital compounds
**Iron (Heme)**
- For haemoglobin constitution, for the transport of oxygen, increased resistance to infection and permits cell respiration
**Biotin**
- Essential component of enzymes and co-enzymes; plays an essential role in the metabolism of fats and proteins
**Phosphorus**
- Helps maintain healthy teeth and bones, DNA components and cell membranes
**Chrome**
- Necessary for the metabolism of carbohydrates
**Zinc**
- To stimulate growth, promote healing, a component of insulin
**Protein**
- High biological value, tissue constituents, hormones, enzymes, immunoglobulin, energy sources
**Selenium**
- Antioxidant, essential in tissue respiration and metabolism of fats
**Fat**
- Energy sources, maintaining body temperature, sources of essential fatty acids, the vehicle of fat soluble vitamins
# Fats and Cholesterols: A Problem Solved
| | Fats (%) | Reduction | |--------|----------|-----------| | | 1996 | 2007 | | | **BEEF** | | | | | Eye Round | 2.8 | 1.1 | -61% | | Tenderloin | 5.0 | 2.2 | -56% | | Striploin | 5.2 | 2.9 | -44% | | **PORK** | | | | | Baked Ham | 14.7 | 7.6 | -49% | | Ham (San Daniele IGP) | 23.0 | 18.6 | -19% | | Mortadella | 28.1 | 25.0 | -11% | APPARENT CONSUMPTION VS REAL CONSUMPTION IN ITALY
PER CAPITA TOTAL g/day
| Source | Apparent Consumption | Real Consumption | |-----------------|----------------------|------------------| | GIRA (2015) | 217 | 110 | | FAOSTAT (2011) | 245 | 76 | | ISMEA (2008) | 248 | 103 | | Average data | 237 g/day | 96 g/day |
Estimation based on production data for macro-economic assessments. It is not feasible for use in nutritional considerations.
Based on surveys involving consumers with the aim of assessing nutritional habits. ANIMALS AND PLANTS: TWO SYSTEMS INTERLOCKED
AGRICULTURAL PRODUCTION AND BREEDING
- agricultural waste:
- compost production
- co-generation energy
- manure:
- organic fertiliser production
- biogas
“CIRCULAR ECONOMY” REGENERATING RESOURCES, CREATE ZERO WASTE
INDUSTRIAL PRODUCTION
- recycling of industrial waste
- co-generation energy from biomass derived from waste products
- compost production from production waste
- transformation of by-products, bones and skins for food, pharmaceutical, animal feed and fertiliser industries
DISTRIBUTION AND CONSUMPTION
- reducing packaging at product’s expiry date
- recyclability of packaging through recycling THE WATER FOOTPRINT OF MEAT
DATA litre/kg
ITALY
WORLD
*The figure refers to heavy pigs [160 kg, 9.11 months of age] while the most common pigs abroad weigh 80/100 kg [7.5 months]* To reduce impacts searching for efficiency
The European production systems are among those characterised by a lower environmental impact per Kg of protein\*
- FAO’s GLEAM project THE COMMITMENT OF LIVESTOCK SECTOR
THE LIVESTOCK SECTOR HAS MANY WAYS TO REDUCE THE ENVIRONMENTAL IMPACTS, ESPECIALLY FOR THE AGRICULTURAL AND BREEDING PHASES THAT HAVE THE HIGHER RELEVANCE.
- PRODUCTION OF BIOGAS
- SOLAR POWER
- MANAGING MANURE
- PRECISION AGRICULTURE
- PROJECT CHANGE-R THE ENVIRONMENTAL HOURGLASS
THE ENVIRONMENTAL HOURGLASS®
NUTRITIONAL PYRAMID
CARBON FOOTPRINT kg CO₂ eq /WEEK
6.7
5.8
1.0
4.5
6.0
TOTAL 24.0 kg CO₂ eq/week
WEEKLY PORTIONS
14 MEAT, FISH, EGGS, LEGUMES, CURED MEATS
24 MILK, YOGURT, CHEESE
21 CONDIMENTS, OIL, FATS
51 BREAD, PASTA, RICE BISCUITS, POTATOES
35 FRUIT, VEGETABLES
THE ENVIRONMENTAL HOURGLASS IN A VIDEO Short Communication
Assessment of diet-related GHG emissions using the environmental hourglass approach for the Mediterranean and new Nordic diets
Maria M. Ulaszewska a, Gloria Luzzani b,d,\*, Sonia Pignatelli c, Ettore Capri b,d
a Department of Food Quality and Nutrition, Research and Innovation Centre, Fondazione Edmund Mach, Via Mach 1, 38010 San Michele all'Adige (TN), Italy b Institute of Agricultural and Environmental Chemistry, Università Cattolica del Sacro Cuore, Via Emilia Parmense 84, 29122 Piacenza, Italy c Life Cycle Engineering, Via Livorno 60 c/o Environment Park, 10144 Torino, Italy d OPERA Research Center, Catholic University of the Sacred Heart (UCSC), Piacenza, Italy HOW WAS IT BUILT
CARBON FOOTPRINT AND WATER FOOTPRINT OF 1 KG OF FOOD
1 kg
IMPACT OF FOOD
×
SUGGESTIONS FROM NUTRITIONISTS FOR A BALANCED DIET
WEEKLY QUANTITIES SUGGESTED
ENVIRONMENTAL HOURGLASS KEY MESSAGES
• The Mediterranean Diet includes the balanced consumption of every food type, without any exclusion.
• Environmental claims and labels aim to support the consumers in identifying the most «virtuos» product within the same food/product group. Different food groups should never be compared on the basis of their environmental impact since they have different functionalities.
• There is no «perfect food»: every choice should be taken on the basis of one’s ethical values and taking the context into consideration.
• The meat sector should commit to improving those critical aspects that still exist: this can only be achieved by focusing on mid-term goals. SCIENTIFIC AND EDUCATIONAL GOALS FOR THE FUTURE
• Developing realistic scenarios for risk assessment and management of the meat productions • Developing archive, data storing for quantitative assessment (LCA) • Setting benchmark and transformation factor for realistic LCA assessment • Linking ecosystem services and protection goal of the above scenarios at different temporal and spatial scales. • Developing reliable sustainable programs for meat production and farm organisation • Set up certification label and corporate social responsibility • Educational, training programs for helping cultural challenge in the meat chain sector The activities of Carni Sostenibili
The Association sustainable meats activities are based on three main areas covering:
- The "institutional" communication
- The presence in the social world;
- The organization of technical support documents for scientific communication.
- Organization of scientific events, press conference, etc.
The sustainability meat and cured meat in Italy. Publishing of scientific report.
Media communication, event, symposium, etc.
Social media presence The published materials
The meat sustainability in Italy
Technical repository of information on sustainability of the meat in Italy. First edition published in 2014, second in 2016.
Versione completa – 280 pagg.
Sintesi – 36 pagg.
Nutritional document
At each event they were published thematic and specific documents on the topics discussed from time to time.
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829dcf71aa289ec792fa49791c9ce867f7812fba | CP(77) 91 - Economic Policy: The Next Steps. Memorandum by the Chancellor of the Exchequer
92 - Public Expenditure: Action to assist the Construction Industry. Memorandum by the Secretary of State for the Environment
93 - The Legislative Programme 1977-78 and The Queen's Speech on the Opening of the New Session. Note by the Lord President of the Council
94 - Wider Implications of the Industrial Strategy. Memorandum by the Chancellor of the Exchequer and the Secretary of State for Industry
95 - The Queen's Speech on the Prorogation of Parliament. Note by the Secretary of the Cabinet
96 - Pay Policy. Memorandum by the Chancellor of the Exchequer
97 - Ninth Report of the Select Committee on Expenditure 1976-77: Draft Government Response. Note by the Chief Secretary, Treasury
98 - Pay Policy. Memorandum by the Secretary of State for Employment
99 - The Queen's Speech on the Prorogation of Parliament. Note by the Secretary of the Cabinet
100 - The Queen's Speech on the Opening of Parliament. Note by the Secretary of the Cabinet
101 - Crown Agents: Fay Report. Note by the Secretary of the Cabinet
102 - Crown Agents: The Fay Report. Memorandum by the Lord Chancellor
103 - Draft White Paper on "The Conduct of Company Directors". Memorandum by the Secretary of State for Trade
104 - 1978-79 National Insurance Contribution Rates in Respect of Employed Earners. Memorandum by the Secretary of State for Social Services and the Minister for Social Security
105 - National Insurance Contribution Review 1977. Memorandum by the Chief Secretary, Treasury
106 - Pay Policy and Low Pay. Memorandum by the Chancellor of the Exchequer
107 - Nationalised Industrial Board Members' Salaries. Note by the Lord Privy Seal
108 - The 1974 Recommendations of the Three Review Bodies: Second Stage Payments. Note by the Lord Privy Seal CP(77) 91 - Economic Policy: The Next Steps. Memorandum by the Chancellor of the Exchequer
92 - Public Expenditure: Action to assist the Construction Industry. Memorandum by the Secretary of State for the Environment
93 - The Legislative Programme 1977-78 and The Queen's Speech on the Opening of the New Session. Note by the Lord President of the Council
94 - Wider Implications of the Industrial Strategy. Memorandum by the Chancellor of the Exchequer and the Secretary of State for Industry
95 - The Queen's Speech on the Prorogation of Parliament. Note by the Secretary of the Cabinet
96 - Pay Policy. Memorandum by the Chancellor of the Exchequer
97 - Ninth Report of the Select Committee on Expenditure 1976-77: Draft Government Response. Note by the Chief Secretary, Treasury
98 - Pay Policy. Memorandum by the Secretary of State for Employment
99 - The Queen's Speech on the Prorogation of Parliament. Note by the Secretary of the Cabinet
100 - The Queen's Speech on the Opening of Parliament. Note by the Secretary of the Cabinet
101 - Crown Agents: Fay Report. Note by the Secretary of the Cabinet
102 - Crown Agents: The Fay Report. Memorandum by the Lord Chancellor
103 - Draft White Paper on "The Conduct of Company Directors". Memorandum by the Secretary of State for Trade
104 - 1978-79 National Insurance Contribution Rates in Respect of Employed Earners. Memorandum by the Secretary of State for Social Services and the Minister for Social Security
105 - National Insurance Contribution Review 1977. Memorandum by the Chief Secretary, Treasury
106 - Pay Policy and Low Pay. Memorandum by the Chancellor of the Exchequer
107 - Nationalised Industrial Board Members' Salaries. Note by the Lord Privy Seal
108 - The 1974 Recommendations of the Three Review Bodies: Second Stage Payments. Note by the Lord Privy Seal CP(77) 109 - Milk Prices. Memorandum by the Secretary of State for Foreign and Commonwealth Affairs
110 - The New Pensions Scheme. Memorandum by the Secretary of State for Social Services and the Minister for Social Security
111 - Top Salaries - National Health Service Consultants and Others. Memorandum by the Attorney General
112 - Pay of Nationalised Industry Board Members. Memorandum by the Lord Privy Seal
113 - Inquiry into the Crown Agents. Memorandum by the Lord Chancellor
114 - Public Expenditure White Paper. Memorandum by the Chief Secretary, Treasury
115 - Benefits of North Sea Oil. Memorandum by the Chancellor of the Exchequer and the Secretary of State for Energy
116 - The Pay Scene. Memorandum by the Chancellor of the Exchequer
117 - A National Development Programme. Memorandum by the Secretary of State for Energy CABINET
ECONOMIC POLICY: THE NEXT STEPS
Memorandum by the Chancellor of the Exchequer
1. We have now gone a long way to consolidate the improvement in our financial position begun last winter. This has been widely recognised both at home and overseas - for example, at the International Monetary Fund (IMF) meeting in Washington. As a result, we are in a position to consider further measures to strengthen domestic demand, and to improve the outlook for employment.
2. Our prospects hinge, however, on the continuing success of the fight against inflation. The uncertainties surrounding the present round of pay settlements have important implications both for the size and the shape of the measures to which we should commit ourselves at this stage.
I. THE ECONOMIC PROSPECT
3. Economic activity has remained subdued this year and unemployment has continued to rise. The main increase in demand has been through exports and, to a lesser extent, industrial investment. Public sector spending on goods and services has probably fallen as planned and personal consumption has dropped sharply. The balance of payments has improved strongly: and the current account is probably now in balance or modest surplus.
4. Retail prices have slowed down. The year on year rise may well be down to some 13 per cent in the final quarter of this year and should be down into single figures during the first half of 1978. As 1978 progresses, however, the outcome will depend increasingly on the level of pay settlements during the coming round. The economic prospect which I outline below assumes that the increase in average national earnings is held to 10 per cent. But the whole prospect could worsen if earnings rise significantly faster. For example, if earnings rise by 15 per cent, retail prices would probably be accelerating back into double figures before the end of 1978.
5. From now on growth may pick up gradually as a recovery in real personal incomes and consumption increases consumer expenditure and production. With exports and private sector investment continuing to rise, total output (GDP) could increase moderately fast (perhaps of the order of 3½ per cent) during 1978. Thus, in the absence of any new policy measures, the economy may be growing at a rate just above what would be needed to stop the upward trend in unemployment.
6. The balance of payments on current account is likely to go on improving, mainly owing to North Sea oil, with a surplus which could be over £2 billion for 1978.
7. The Public Sector Borrowing Requirement (PSBR) for 1977-78 is now forecast at about £7 billion - that is, £1.7 billion below the figure to which we committed ourselves last December. It is very tentatively put at about £7 billion also in 1978-79.
8. In the first four months of 1977-78, the growth of domestic credit has been very slow, while the growth of sterling M3 has been at the bottom of the target range of 9-13 per cent. The outlook for the remainder of the current year is for the growth in £M3 to accelerate and to be towards the top end of the 9-13 per cent range for the year as a whole; a similar rate of growth could be envisaged in 1978-79. Confidence in domestic markets is however closely related to the level of pay settlements and if these are in excess of the 10 per cent assumption, interest rates will be carried up, gilts will be more difficult to sell, and consequently £M3 might be at or above the 13 per cent upper limit to the target range.
II. ASSESSMENT
Demand for Resources
09. There is now a clear case for early action to stimulate demand. We must aim at creating the conditions in which unemployment turns firmly downwards.
10. At the same time, we must avoid the mistakes of our predecessors in 1972-73. Beyond a certain point, the injection of money into the economy at this stage would be more likely to recreate industrial bottlenecks, suck in imports and stimulate inflation, than to increase our own domestic output and bring down unemployment. Inflation in Britain is still higher than the Organisation for Economic Co-operation and Development (OECD) average; there is uncertainty about the outcome of the current pay round; and both investment and consumers' expenditure may already be on the upturn. So excessive stimulus could create real risks, particularly when we look forward to 1978-79. Monetary Prospects
11. It must be our objective not to break the present virtuous circle in which, by keeping the money supply within the target range, we have helped to sustain the exchange rate, to bring down domestic interest rates, and to reduce expectations of inflation; this in turn has strengthened confidence; and confidence in turn has made it easier for us to keep to our monetary objectives.
12. Because on present policies we may finish the year towards the top end of our target range for sterling M3, fiscal action on a large scale could imply some increase in the level of interest rates. This will depend crucially not only on the size of the fiscal package, but also on its nature - the extent to which it concentrates on measures which are consistent with the overall economic strategy to which the Government has pledged itself, and which therefore are likely to meet a favourable market response. The market's response will depend to an important extent on whether the Government is seen to be maintaining the firm control of public expenditure which it established last year.
III. SHAPE OF AN AUTUMN PACKAGE
13. All these considerations suggest that any package of measures should meet the following tests:
a. Both because we want the largest and quickest effect on unemployment and because we can count on significant headroom in 1977-78, it should give a further significant stimulus in the current year; but, because the outlook for 1978-79 is more uncertain, it should not pre-judge the size and shape of the 1978 Budget more than is essential.
b. It should be seen to be consistent with the Government's published targets for the monetary aggregates and with our IMF commitments for the current year.
c. It should be seen as a natural development of the economic strategy which I announced in the Budget and which has been endorsed at international meetings.
d. It should be consistent with maintaining a sufficient surplus on the current account and enabling us to make a start on repaying our debt.
14. The measures will also, of course, have to take account of the present position in Parliament and the pact with the Liberals.
15. On balance, I believe that measures costing up to £1 billion in the current year (1977-78) can now be justified; we need to leave some of our options open for 1978-79, but we can, I think, now commit a further £1 billion in that year - or a total of £2 billion over the next 18 months.
IV. ACTION AFFECTING 1977-78
16. The options for significant action in the current year are, for practical reasons, very largely confined to cash transactions - either tax changes or transfer payments - and even here the administrative constraints are formidable. There is little scope for varying the Government's purchases of real resources between now and next March.
Indirect Taxes
17. A cut in indirect taxes would contradict our stated objective to shift the tax burden from direct to indirect taxation. But it would in the long run have a similar demand effect to a cut in direct taxation and would reduce inflation in the short run. The standard rate of Value Added Tax (VAT) could be reduced from 8 per cent to (say) 6 per cent, and the higher rates of VAT from 12½ per cent to (say) 10 per cent. This would take effect from a current date in November and the demand effect would therefore be relatively small in the current financial year, since it is impossible to backdate changes in indirect taxation. Similarly, and also because of the lags in VAT collection, the cost in 1977-78 would be rather small - £115 million; but the cost in 1978-79 would be some £900 million. It would reduce the year on year inflation rate by 1 per cent straightaway.
18. It would also be possible to reduce the specific duties, but this would appear particularly perverse at a time when their real value has already fallen significantly in recent years and the arguments of energy conservation, transport and health policy point in the other direction. Indeed, now that we are committed to the indexation of personal income tax allowances, there is a strong case in principle for raising these duties annually in line with inflation.
Income Tax
19. It is not possible for the Inland Revenue to make administrative room for a cut in income tax in mid-year unless we exempt from tax in the current financial year the November increase in National Insurance pensions - at a cost of £40 million, giving a significant addition to the real income of about 2½ million pensioners. On this condition, the Revenue would be able to implement this autumn an increase in the personal allowances for all taxpayers for the current financial year. The obvious course is to introduce this autumn some or all of the increases in personal allowances (indexation in line with price inflation), which under the 1977 Finance Act we are required to implement next April unless we can get the House of Commons positively to vote against them. This would be an advance or "on account" relief. On present estimates, full indexation requires increases of around 12 per cent - that is £100 in the single allowance, £160 in the married allowance and corresponding increases in the other personal allowances. This would take nearly 1 million people out of liability to tax. If introduced in 1977-78 the cost would be £985 million. There would be relatively little additional cost for 1978-79, over and above the indexation to which we are already committed under the 1977 Finance Act.
20. The increases in allowances would be backdated to April so that they applied to the whole of the current tax year. Thus they would entail lump sum tax rebates payable in November or December of up to £40 for a married man, and £25 for a single person, plus additional tax relief of a little over £1 a week for a married man thereafter.
21. Full indexation this autumn would represent a much more substantial stimulus to demand in the immediate future than the reduction in VAT or the specific duties. It could be worth nearly half of 1 per cent of GDP by the first quarter of 1978, and it would thus have a quicker impact on the unemployment figures. At the same time, it would represent a minimum additional commitment for the 1978 Budget. Thus, it would leave us with the maximum flexibility to introduce further fiscal reliefs in the Budget if economic circumstances permit. By the same token, it would give a reasonable assurance that we shall not have over committed ourselves, if events develop less favourably. It would also give maximum help to the lower paid and enlarge the gap between income from work and income from benefits.
22. If we decided to give less than the 12 per cent indexation of personal allowances at this stage - perhaps for the reasons discussed in paragraph 29 below - the effects in paragraphs 19-21 above would, of course, be correspondingly smaller. It would in that case be important to make clear that we would raise the level of allowances further in the Spring Budget so as to achieve then the full indexation prescribed in the Finance Act 1977.
Public Expenditure
23. The Contingency Reserve for 1977-78 has now been run down by our previous decisions to about £190 million. Depending on the form of assistance, the Ford Erika project in South Wales is likely to require this year some £30 million from the Contingency Reserve; but this could rise to as much as £45 million. I am sure that we should not exceed the Contingency Reserve in only the second year of its operation as a control figure.
24. Within what remains there are a number of options. For example, we could cancel the artificial administrative delay of 3 months in the payment of regional development grants and agricultural capital grants. imposed as part of the 1976 expenditure cuts. This will have to be done some time since complaints will build up if the delays are maintained. The release of funds would benefit industry in assisted areas, and agriculture. The cost is once for all. If it were done now, the cost would be around £100 million in 1977-78 and perhaps £25 million in 1978-79.
25. Another possibility might be to pay a £10 Christmas bonus to pensioners. This would also cost about £100 million, and would inject some quick spending power this year. The weight of argument in normal circumstances would be against it. While in theory it could be regarded as once-for-all, it must lead to strong pressure to repeat it in future years. It was suggested earlier this year as something which might be done if prices over the previous 12 months proved in the event to have risen by more than the amount of the November uprating, but it now appears certain that the November uprating will exceed the actual rise of prices. The 2½ million pensioners paying tax will get an unexpected bonus since they will not now be taxed on their pension increase for the rest of this financial year, while those on supplementary pension, the poorest, will again benefit from our winter fuel scheme. It would also require legislation and there must be some risk of amendments which if carried would increase the figure further. On the other hand, if we decide to increase personal tax allowances, people in work will be receiving substantial income tax rebates shortly before Christmas. There is a case for giving at the same time some cash sum to the majority of pensioners who will not benefit from the income tax relief.
26. It is doubtful whether there are any other public expenditure measures which would contribute significantly towards stimulating demand in 1977-78, without carrying through automatically into 1978-79, when the problem will be very different.
V. MEASURES AFFECTING 1978-79
27. As I have said, it is important that we leave ourselves with the maximum flexibility in deciding the size and shape of our fiscal measures - increases in expenditure or reductions in taxation - for 1978-79.
Taxation
28. The shape of the 1978 Budget will need to be considered in the light of developments between now and next spring. There may well be little room for major fiscal stimulus in any case, depending on the level of pay settlements and the growth of economic activity in the coming months. However, it will be very important, after the sacrifices of the last three years, that the Budget should be able to give some significant relief in the structure and burden of income tax for 1978-79. In particular, April 1978 will bring a big increase in superannuation contributions under the new scheme for "Better Pensions" and a further cut in child Tax Allowances to accompany the increase in child benefits. Moreover, the 12 per cent increase in personal tax allowances required by indexation will still be less than this year's 14 per cent increase in National Insurance benefits. There will thus be powerful political and economic arguments for further reductions in income tax in April, in addition to the more general arguments which I summarise in paragraphs 35 to 40 below.
29. The sums at stake are very large. For example, the increase in National Insurance contributions and loss of child tax allowances could next April cut some £1.50 a week off the take home pay of a man with two children on average earnings. To offset this in full could (on present estimates) cost between £1,750 million and £2,000 million, depending on the form in which relief is given. This is one reason why we might be wise to give less than the full 12 per cent increase in personal allowances at this stage, so that something is left over to be paid in April.
30. Another possibility might then be to offset the cut in real take home pay next April by introducing a reduced rate band of income tax. But again this could be very expensive. For example, a reduced rate band of £1,000 liable to tax at 25 per cent could cost £2,100 million.
Public Expenditure
31. Providing we do not over-commit ourselves to massive further cuts in taxation next year, I consider that we can plan for some increase in public expenditure in 1978-79. But we must beware of overcommitting ourselves there too. My proposal below would imply a central forecast for the PSBR of some £7½ billion in 1978-79, before allowing for any further action in the next Budget or for any consequential effect if we were to choose the indirect tax option for action this autumn. Every addition to public expenditure reduces the scope for tax reliefs in the Budget and increases the risk that if events develop unfavourably, a net tax increase then may prove unavoidable.
32. My judgement is that we cannot afford to increase the planned total of programmes and Contingency Reserve for 1978-79 by more than an absolute maximum of £1 billion in terms of next year's prices, or some £850 million at 1977 Survey prices - or 2 per cent above the planned level of this year (1977-78). Even this would risk dangerously limiting the scope for further action on direct taxation in the next Budget. Of this increase, the measures we have already announced have committed over £500 million in 1977 Survey prices, of which the principal items were the uprating of child benefit and other social security benefits, the youth and other employment measures and construction work in the inner cities. The main element of the remainder should be further help for the construction industry, which in July we promised to consider. This expenditure on construction will benefit a wide range of programmes; and the balance, assisted by savings which Departments have identified, will enable us to meet many, though not I regret all other bids put forward by Departments. Detailed proposals for the various programmes are set out in the Chief Secretary's paper CP(77) 89.
Small Firms
33. There is a good deal of pressure to do something for small firms especially on the tax side. They are important to the economy as suppliers to large firms, as innovators and as employers providing more than a fifth of total employment. They may play a valuable role in dealing with the problems of the inner city areas. At present there is a widespread lack of confidence among them and, rightly or wrongly, much of the blame for this is put on the weight of taxation. Although I do not think we should be bemused by this pressure into thinking that there is a great deal wrong with the present tax regime, it is an area where we can usefully provide a psychological stimulus to activity. In conjunction with the Chancellor of the Duchy of Lancaster, who is carrying out a special study of their problems generally, we are therefore considering a number of tax and other measures whose benefit will be concentrated on small firms. We could include these with the wider economic package but they would probably cost only £10 million in the current year and would not be expected to cost more than £70 million next year.
VI. 1979-80 AND SUBSEQUENT YEARS
34. Looking forward to the medium term, the prospect remains very much as I described it in my paper of 1 July (CP(77) 70). In the optimistic case, where earnings increase by no more than 10 per cent in 1977-78, it should be possible to sustain a growth rate of about 4 per cent a year on average from 1978 to 1982. This would be a significantly faster rate of growth than we have been able to sustain in the past. However, we are unlikely to achieve this unless we improve our international competitiveness and raise the level of industrial investment. These two conditions to a considerable extent go together. Both would be at risk if inflation is not contained. Both would be helped by the successful implementation of our industrial strategy.
35. Our assessment last summer assumed that public expenditure would be held to the Cmd 6721 level in 1978-79 and to an annual growth of 2 per cent thereafter - with any fiscal action to raise demand coming through cuts in taxation. The prospect for 1978-79 justifies us in raising the planned total of expenditure by £1 billion (at output prices) in that year and I would be content to see additions to the figures for 1979-80 and 1980-81 on the scale proposed in the Chief Secretary's paper. Over the medium term as a whole, however, there are still compelling reasons why we should give priority to reductions in taxation as a means of stimulating demand.
36. First, tax reductions can help us to continue the fight against inflation. Reductions in income taxes increase real take home pay without adding to industrial costs, and help to reduce the pressure for increased money incomes. Reductions in taxation on industry reduce production costs. Reductions in indirect taxes cut prices.
37. Second, the increase of public expenditure up to 1975-76 increased the tax burden to a degree which is widely felt to have become too heavy at all levels of income.
38. Third, tax cuts can help to expand the manufacturing and private service sectors of the economy, to which we must mainly look for future growth in employment.
39. Fourth, tax cuts are likely to give us more room to act against unemployment, because they command much more confidence in financial markets than increases in public expenditure.
40. Fifth, the amount by which we will be able to stimulate demand in these later years is extremely uncertain. There may be much less room for manoeuvre than we expect at present. Taxes can be more readily adjusted than expenditure programmes.
VII. CONCLUSIONS
41. I ask my colleagues:
a. to agree that a stimulus of up to £1 billion in 1977-78 is appropriate and to express their preference as between the options I have described in paragraphs 17-25.
b. To agree that the public expenditure programmes for 1978-79 in Cmnd 6721 should be increased by £1 billion (at the outturn prices of that year).
c. To agree the additions to public expenditure proposed by the Chief Secretary, Treasury, for 1979-80 and subsequent years.
D W H
Treasury Chambers
10 October 1977 CABINET
PUBLIC EXPENDITURE: ACTION TO ASSIST THE CONSTRUCTION INDUSTRY
Memorandum by the Secretary of State for the Environment
BACKGROUND
1. At our meeting on 14 July (CM(77) 25th Conclusions) we discussed the question of help for the construction industry. We noted that the Chancellor of the Exchequer would be announcing additional public expenditure of £100 million for this purpose in 1977-78 and agreed that there was a strong case for further assistance in 1978-79. Accordingly in his statement to Parliament on 15 July the Chancellor of the Exchequer said that the Government were considering, in the course of the normal annual review of public expenditure, what further help could be given to the construction industry in the next financial year (Hansard cols 992-3).
2. In CP(77) 71 I set out the problem facing the industry and stressed the overwhelming case for help. Later information has confirmed how deep was the recession affecting the industry in the first half of the year. Output was 6 per cent lower than in the second half of 1976. Employment has fallen less than might be expected, with the implication that many men are being kept on in the hope of an early recovery in demand.
3. I expect such a recovery in the private sector, following the great improvement in financial markets. But this will be barely sufficient to offset the further decline in public sector work that is allowed for in present plans. If those remain as they are, the industry's total output is likely to differ little next year from this year. This carries with it the prospect of 75,000 more unemployed by the end of 1978 and the possibility of severe damage to the capacity and efficiency of the industry. Output per man has already fallen by 9 per cent since 1973. Urgent action to bring about an early recovery in demand is essential. But we need to do that in the way that will best contribute to establishing a more stable pattern of demand in the future. That requires action now in relation to programmes for this year and the two following. PROPOSALS FOR ACTION
4. The present slump is partly due to greater-than-intended falls in expenditure this year: experience suggests that cash limits tend to depress spending to a level some way below that of agreed programmes, particularly in the construction field, where there are difficulties in making adjustments during the course of a year. I would therefore urge my colleagues - as I have been doing in relation to my own Department's programmes - to do their utmost to ensure that any shortfall on their construction programmes is minimal, even to the extent of running some extra risk that cash limits on particular blocks may be exceeded, in exceptional circumstances.
5. Departmental programmes now provide for expenditure on construction of £4,769 million in 1978-79 compared with £5,100 million in 1977-78. Merely to keep public sector construction demand in 1978-79 to this year's level would therefore require an extra £330 million; to return it to the level of last year would require £920 million. A survey of the capacity of Departments to mount additional construction programmes shows that they could usefully spend about £780 million in 1978-79 in addition to the agreed programme as set out in Cmd 6721, of which £174 million is included in the additional proposals for expenditure detailed in Annex 2 of the 1977 Public Expenditure Survey Committee (PESC) Report. The attachment to this memorandum sets out the detail. There would be additional associated expenditure in 1978-79 of £15 million, and indirectly, expenditure on housing land and on loans for house purchase could amount to a further £45 million. The projects begun under any extra expenditure made available in 1978-79 would entail further expenditure in the later years of the PESC period of roughly the same order.
6. In CP(77) 71 I proposed that public sector construction programmes should be increased by £400 million in 1978-79 and that the increase should be maintained in subsequent years. I was conscious that this would do little more than keep the 1978-79 programmes at their current level. But the improvement in the economic situation now provides us with greater scope to make a positive contribution to helping the industry out of recession. My colleagues will be aware that the unions have been pressing for an extra £1,100 million. At the same time we must be realistic about what we can expect to achieve in the next 18 months. On balance I believe that a package of not less than £600 million is needed in 1978-79 to demonstrate that we are taking the industry's problems seriously. (This would include the additional proposals for construction expenditure in Annex 2 of the 1977 PESC Report.) It would add 3½ per cent to construction output and, allowing for a possible rise in private demand, would make the total demand in 1978 about the same as in 1976. It would be worth 50,000 jobs, though the direct fall in unemployment would be less than this. It would be desirable to add a sum of the same order to the programmes from 1979-80 to get back to an acceptable level and to continue with further additions in subsequent years: even to stabilise on the level I propose for next year would require the addition of a minimum of £380 million in 1979-80.
7. The effect of such a package on the public sector borrowing requirement would be reduced by the net increase in Exchequer receipts from tax and national insurance payments and the abatement of unemployment benefit. The net effect on the borrowing requirement of a package of £600 million would be £400 million in 1978-79.
8. Detailed consideration will need to be given to the way in which additional expenditure on construction should be allocated. We must try to see that help is concentrated on the sectors in greatest need, and the need to alleviate unemployment must be the first priority. Housing, which contributes about half of public sector demand, should have a large share; and a significant element should be devoted to civil engineering which has been particularly affected by cuts in public expenditure. There are also the claims of energy conservation to be considered and proposals now before the Secretary of State for Energy to allot about £50 million a year for thermal insulation and heating controls in public sector buildings will make a useful contribution. Much of the work would be done by local authorities and we shall need to consult them carefully about this in relation to their overall expenditure plans. I hope that they will accept the package as going some way to redress the balance which past cuts have produced against capital expenditure.
CONCLUSIONS
9. Despite the help that we have already provided, the crisis in the construction industry will continue next year - unless we take vigorous and positive measures now. Even my present proposals will not be enough to prevent a further rise in unemployment. We have already undertaken to consider what further help can be given and we have the capacity within Departmental programmes to make a contribution which will demonstrate our concern, and go some way to meeting criticism of our readiness to cut capital spending. But the action we take must be seen to match the scale of the problem. Moreover, because construction programmes take time to mount it would be wrong to settle for some lower figure now and wait until next year to see if it were enough.
RECOMMENDATIONS
10. I invite my colleagues:
a. To take vigorous action to ensure that 1977-78 programmes are fulfilled.
b. To agree that public sector construction programmes should be increased by £600 million in 1978-79 and that the level thus established should at least be maintained in the later years of the PESC period. c. To instruct officials to consider the detailed composition of the package in the light of the considerations set out in paragraph 8 above.
PS
Department of the Environment
10 October 1977 | No | PESC Programme | Construction Element of Current Programme (Sup. Analysis F of Current 1/77 PESC Report) | Department | Construction Element of PESC Bid in Amor 2 of 1977 PESC Report | Additional Construction Capacity Identified in Survey | |----|----------------|--------------------------------------------------------------------------------------|------------|----------------------------------------------------------------|--------------------------------------------------| | | | 1977-78 | 1978-79 | MOD | 1978-79 | 1978-79 | | 1 | Defence | 153 | 167 | MOD | - | 20 | AB | | 2 | Agriculture | 12 | 12 | MAFF | - | 2.74 | A | | 3 | Trade | 98 | 105 | D of Industry | - | 1.0 | - | | 4 | Roads & Transport | 724 | 600 | D of Trade | - | 31.0 | - | | 5 | Housing | 2377 | 2314 | England: LA and New Towns | 65.0 | 50.0 | - | | 6 | Other Environmental Services | 896 | 841 | DOE | 40.0 | 100.0 | - | | 7 | Law and Order | 92 | 67 | Lord Chancellor's Office | 3.3 | - | - | | 8 | Education | 293 | 292 | DSS | 8.0 | 50.0 | A | | 9 | Health | 320 | 330 | DHSS England | 60.0 | - | - | | 10 | Public Services| 75 | 51 | DOE | 0.5 | - | - | | 11 | Common Services| 100 | 100 | DOE/PSA | 7.0 | - | AB | | | TOTAL | 5000 | 4769 | TOTAL | 129.0 | 521.67 | - |
A Includes provision for Wales B Includes provision for Scotland C Represents 5/65 of bids which do not already include provision for Wales D Represents 10/65 of bids which do not already include provision for Scotland
CONFIDENTIAL CABINET
THE LEGISLATIVE PROGRAMME 1977-78 AND THE QUEEN'S SPEECH ON THE OPENING OF THE NEW SESSION
Note by the Lord President of the Council
1. I attach a revised draft of The Queen's Opening Speech, incorporating the amendments which we agreed on 11 October. These, and other amendments and additions to the text of Annex C to CP(77) 88, are sidelined.
2. There are four points for further discussion:
a. The paragraph on North Sea Oil (circulated separately under cover of a letter dated 17 October from the Prime Minister's Private Secretary to the Lord President's Private Secretary).
b. I appreciate the doubts expressed on 11 October about the inclusion in the Speech itself of a catalogue of Bills which we wished to introduce as soon as Parliamentary time could be found. Nevertheless it remains most important in my view that the Speech should reaffirm our commitment to the Merchant Shipping and Post Office Bills, and a suggested form of words is in paragraph 8 on page 4.
c. I have discussed with the Secretary of State for Energy how Parliamentary time could be found to fit the Electricity Bill into the legislative programme. The best way would be to combine this Bill not only with the Bill on Drax B but also with the Atomic Energy Bill. The Parliamentary time required for this combined Bill, together with the other two Department of Energy Bills, would be little more than that needed for the Department's four Essential Bills if they remained separate.
d. I am in consultation with the Secretary of State for Employment on whether the Employment Bill should now be regarded as Essential, and will report the outcome as soon as possible.
M F
Privy Council Office
17 October 1977 DRAFT OPENING SPEECH
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS,
I look forward to paying a State Visit to the Federal Republic of Germany next May.
My Government re-affirm their policies in international relations and defence. They remain committed to the aims of peace and collective security; and of detente, disarmament and prevention of the spread of nuclear weapons. They will contribute fully to the work of the United Nations, the Commonwealth and the North Atlantic Alliance.
My Government, while working for policies which fully reflect the interests of the United Kingdom, will play a full and co-operative part in the activities, the development and the enlargement of the European Economic Community.
My Government will continue to contribute modern and effective forces to the North Atlantic Treaty Organisation, and to play their full part in the current Alliance studies of East/West relations and of the Alliance's defence programmes. They will continue to participate constructively in the important meeting in Belgrade which is being held as part of the follow-up to the Final Act of the Conference on Security and Co-operation in Europe, will abide by the provisions of the Final Act and will continue to seek fulfilment of all its provisions by other signatories. They remain committed to the pursuit of detente in their relations with the Soviet Union and the countries of Eastern Europe.
My Government will continue to take part in international efforts to combat recession and promote a more stable world economic order, and a fairer distribution, within an expanding world economy, of the world's wealth between rich and poor nations; they will maintain their special efforts to help the poorest countries and the poorest people. My Government will work for a just and lasting peace in the Middle East, and the further improvement of relations between the United Kingdom and all the countries in the area. They will continue to co-operate with all concerned in the search for a lasting settlement in Cyprus, where they welcome the resumption of intercommunal talks.
My Government will continue to work for a negotiated settlement in Rhodesia, on the basis of their proposals published in September this year, which are designed to provide a secure future for people of all races. They will be ready during the current session to introduce legislation to enable Rhodesia to proceed to independence on this basis.
MEMBERS OF THE HOUSE OF COMMONS,
Estimates for the public service will be laid before you.
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS,
The strengthening of our financial position and of the balance of payments opens the prospect for a continuing improvement in the economy and the maintenance of financial stability. My Government's main objectives are the speediest possible return to full employment and a sustained growth of output. In order to achieve these objectives my Government will give the highest priority to further reductions in the rate of inflation.
My Government will continue to promote industrial training and to create and maintain jobs through manpower measures.
[Paragraph on North Sea oil]
My Ministers will continue to work in close co-operation with the Trades Union Congress and the Confederation of British Industry.
My Government will continue to urge internationally that the stronger economies should take the lead in promoting a sustained growth in the world and that adequate official finance should be made available on appropriate terms to countries with continuing deficits in the balance of payments. My Government remain firmly committed to establishing directly elected Assemblies for Scotland and Wales. Separate Bills will be introduced for this purpose.
In Northern Ireland my Government will maintain their aims of establishing a devolved Government acceptable to both parts of the community; and eradicating terrorism by the prosecution through the courts of those responsible for violence and by continuing to develop the effectiveness of the Royal Ulster Constabulary, supported by My Armed Forces. My Government attach special importance to co-operation on matters of security with the Government of the Republic of Ireland. They will continue to seek measures to strengthen the economy of Northern Ireland and improve its social environment.
Legislation providing for the election of United Kingdom members of the European Assembly will be re-introduced.
Further consultations will be held on industrial democracy, with a view to producing proposals which should command general support, and My Ministers will continue directly to encourage the development of industrial democracy in the nationalised industries.
There will be a review of the legislation and institutions governing competition policy, to see that this makes its maximum contribution to improving industrial efficiency.
My Ministers are considering further measures to assist small firms.
My Government will hold consultations about encouraging profit-sharing through the tax system.
Legislation will be brought forward to amend company law.
A Bill will be introduced to provide public funds to finance payments to redundant shipbuilding workers in the public sector. Legislation will be introduced to provide for payments to the Central Electricity Generating Board towards the cost of Irax B power station.
Continued encouragement will be given to the efficient production, processing and distribution of food with the aim of meeting a greater proportion of our national needs from United Kingdom agriculture. My Ministers will seek improvements in the operation of the Common Agricultural Policy.
My Government will continue to seek major reform of the Common Fisheries Policy. They will aim to secure conditions which will meet the needs of the British fishing industry, conserve fishing stocks, and ensure adequate supplies to the consumer.
A Bill will be laid before you to increase the borrowing powers of the Civil Aviation Authority and British Airways, to provide for a levy to finance aviation security and to amend the civil aviation Acts.
Legislation will be introduced for the further development of transport policy to meet economic and social needs, including those of rural areas.
Legislation will be brought before you to provide assistance for first-time home buyers.
A Bill will be introduced to renew and revive the inner urban areas.
In addition to My Government's full programme of constitutional and other reforms for the present Session, they remain committed to bringing forward at the earliest opportunity a number of further highly desirable measures of reform. These measures include improvements in safety and discipline at sea and other aspects of merchant shipping, and the right of Post Office staff to take industrial action.
Legislative proposals will be brought forward for the reform of section 2 of the Official Secrets Act 1911. Following the Report of the Committee on the Future of Broadcasting, My Government will bring forward proposals on the constitution, structure and organisation of broadcasting in the United Kingdom.
An increase in the limit on public funds for the National Film Finance Corporation will be proposed before the present limit expires.
Measures will be brought before you to reform public sector housing subsidies in Scotland; to improve criminal procedure and reform the criminal justice system; and to extend the powers of Scottish local authorities in relation to their direct labour organisations.
My Government will make further progress with their programme of law reform.
Other measures will be laid before you.
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS, I pray that the blessing of Almighty God may rest upon your counsels.
17 October 1977 CABINET
WIDER IMPLICATIONS OF THE INDUSTRIAL STRATEGY
Memorandum by the Chancellor of the Exchequer and the Secretary of State for Industry
1. At its meeting on 21 July (CM(77) 27th Conclusions, Minute 5), the Cabinet invited us to prepare a revised draft paper on the Wider Implications of the Industrial Strategy, for submission to the National Economic Development Council (NEDC). The Ministerial paper for NEDC and the annexed report by officials have been revised in the light of the Cabinet discussion, and of written comments from our colleagues (though we have not felt able to accept every one of the comments made). They have been further revised after discussion in a small group of Ministers (GEN 98).
2. Our earlier paper for Cabinet (CP(77) 84) explained the work of the official group which had led up to the NEDC paper in its earlier draft. It went on to:
i. list the new commitments and proposals contained in that draft;
ii. explain that certain important issues had not been discussed in the draft because it would be difficult to raise them on a tripartite basis at present;
iii. list certain other policy areas which the official group wished to draw to Ministers' attention;
iv. make proposals for further work in this field.
3. In this memorandum, we confine ourselves to summarising the main changes that have been made to the earlier draft. The main changes in the report by officials (Annex B) are as follows:
a. A section (paragraphs 1.10-1.12) has been added on Education and Training for Industry. b. The paragraph (1.20) on the overlap of incomes of people in, and out of, work now has a concluding sentence to show that we are trying to take steps to overcome this problem.
c. In paragraph 3.2 there is no longer the implied suggestion that employment legislation is to stop dead. The draft now says that the Government will take full account of the volume of measures carried out in considering any fresh proposals in this field.
d. There is now (in paragraph 5.2) a reference to the low level of company taxation in the United Kingdom, and also to the lower burden of social security contributions by industry than in other countries.
e. Paragraphs 6.1 and 6.2 have been added to cover the point that industry are concerned to avoid over-elaborate inflation accounting and company reporting requirements.
f. Paragraph 9.2 includes a reference to the National Research Development Corporation.
g. The passage on competition policy (paragraph 12.1) no longer includes a commitment to provide "guidance" on this to industry, since this is still for discussion by the Ministerial Committee on Economic and Industrial Policy (EI).
h. Paragraph 13.3 contains a clear commitment that we should aim for a greater interchange between the Civil Service and industry. The passage now says that we should be aiming for exchanges approaching 200 at any one time by the end of the decade.
In addition, the covering paper (Annex A) now gives more emphasis to the crucial need to improve our industrial performance, by all means possible, if we are to achieve our long term social and economic objectives. The drafting has also been tightened up.
4. The new commitments and proposals contained in the revised draft are the same as in the earlier draft, except in the areas of employment legislation and competition policy already mentioned. The commitments in these two areas now amount to:
i. An undertaking to take into account the volume of recent measures in considering future employment legislation.
ii. A review of the role of competition policy as part of the industrial strategy. 5. Our proposals for future work in this field remain as set out in paragraphs 8-11 of our earlier paper. Likewise, we would draw the attention of other Ministers as before to certain policy issues which the official group did not cover in their report, or did not cover fully.
CONCLUSION
6. The Cabinet is invited:
a. To approve the attached papers for submission to NEDC.
b. To endorse the proposals contained in the papers (as summarised in paragraph 4 of CP(77) 84 subject to the changes noted in paragraph 4 above).
c. To approve the proposals for further work in this field as set out in paragraphs 9-10 of CP(77) 84.
d. To take note of the points in paragraphs 5 and 6 of CP(77) 84.
D W H E G V
Treasury Chambers
21 October 1977 WIDER IMPLICATIONS OF THE INDUSTRIAL STRATEGY
Memorandum by the Chancellor of the Exchequer and the Secretary of State for Industry.
INTRODUCTION
1. Industry holds the key to the generation of wealth. In the post-war period we have been afflicted with a climate of opinion - effete and wrong-headed - in the UK which has been at best indifferent and at worst hostile to the role of industry in society. This tendency is deeply rooted in our history, class system and social structure. Society has not given the men and women who work in our manufacturing industry - at all levels - adequate recognition of their key role. Much of the best of our national talent has been brought up to believe that it is not nice to dirty their hands at the workbench or in the engineering shop. They have been influenced towards employment outside industry. Of course manufacturing is not the only sector which creates wealth and contributes to our trading performance. But it is in our manufacturing industry, despite its traditional dominance and its concentration of capital and skills, that we have lagged most conspicuously behind our major industrial competitors.
2. That is why the Government, in the November 1975 White Paper "An Approach to Industrial Strategy", committed itself to identifying the industrial implications of the whole range of its policies and undertook to "give greater weight, and more consistently than hitherto, to the need for increasing the national rate of growth through regenerating our industrial structure and improving efficiency. For the immediate future", it said, "this will mean giving priority to industrial development over consumption or even our social objectives. There is no other way of developing the industrial base on which the Government's whole programme of economic and social reform depends."
3. The attached paper is a first survey of the broad areas of Government policy (outside those directly covered by the work of the sector working parties) which bear in one way or another on industrial performance and efficiency. It also describes certain action already taken or now proposed to give a higher priority to the needs of industry, and makes proposals, subject to the views of the Council, on how this problem should be tackled in the longer term. It is no easy matter to change the deeply rooted attitudes and accumulation of policies which have contributed to industrial decline. The change will take many years; but the Government is determined to continue with this work. The objective must be to ensure that British industry receives at least the same degree of support, and as favourable an environment, as is given to their own industries by the countries which compete with us. That is the very minimum that we seek.
FUTURE ACTION
4. The Government proposes, subject to the views of the Council, to carry out further reviews of areas of policy which pose long-term problems for industrial efficiency. These are outlined in the attached paper as follows:
(i) the employment of graduates by industry (paragraph 1.9); (ii) public sector manpower policy (paragraph 1.18); (iii) tax and social security in relation to work incentives (paragraph 1.25); (iv) the effect of standards and specifications on the export potential of products purchased by the public sector (paragraph 11.3); (v) mobility between the civil service and industry (paragraph 13.5); (vi) the burdens on industry (paragraph 13.6).
5. In addition it proposes that: (i) Ministers from the non-industrial Departments should attend NEDC from time to time to discuss their contribution to the industrial strategy. A start was made in July when the Secretary of State for Education and Science and the Secretary of State for the Environment attended the Council.
(ii) SWPs should be invited to take note of the continuing work on the wider implications of the industrial strategy and to give their views on priority areas for changes in Government policy.
(iii) There should be regular reports to the Council on the progress made on the wider implications of the industrial strategy.
CONCLUSION
6. It is now impossible to imagine Britain's industrial scene without the tripartite Industrial Strategy. That is a measure of the success we are beginning to achieve. In the improving economic climate we must not relax our efforts. It would be disastrous if we now took it easy and cast away opportunities which may not easily return.
7. As part of the work, we must make real progress on the wider implications of the strategy. The attached paper draws attention to a wide range of problems, to many of which there are no easy or quick solutions. The Government would welcome the Council's views on effective ways in which these problems might be tackled. WIDER IMPLICATIONS OF THE INDUSTRIAL STRATEGY
REPORT BY OFFICIALS
1. The attached report has been prepared in accordance with a remit by the Prime Minister dated 16 February for a Group of officials under Treasury chairmanship to prepare a draft paper for NEDC on the linking of industrial to other policies. The Group included representatives of the Departments of Education and Science, Employment, Energy, Environment, Health and Social Security, Industry, Prices and Consumer Protection, Trade, Transport, and the CSD, CPRS, FCO, MAFF and MOD.
2. This report (with the omission of this page) is intended to form an annex to a joint NEDC paper by the Chancellor of the Exchequer and the Secretary of State for Industry. WIDER IMPLICATIONS OF THE INDUSTRIAL STRATEGY
Contents
LABOUR
1. The Supply of Labour to Industry: schools education; higher and further education; public sector manpower policy; incentives to work.
2. Mobility of Labour: Housing; transferability of pensions.
3. Employment Legislation
CAPITAL
4. Cost and Availability of Capital
5. Taxation
6. Company Reporting
PRODUCTION AND DISTRIBUTION
7. Infrastructure: planning and land; industrial development certificates and office development permits; building regulations; roads; public transport.
8. Production and Distribution Costs: pollution policy; energy policy; transport costs; water charges.
9. Research and Development
SALES
10. Marketing: metrification; standardisation. BUSINESS ENVIRONMENT
11. Competition Policy
12. Relations with Government: civil service/industry mobility; burdens on industry. LABOUR
13. The Supply of Labour to Industry
1.1 It is essential that a fair share of the nation's most able manpower - at all levels - is employed in manufacturing industry, and that their education, training and motivation are such that their ability can be fully utilised in industry. There is good reason to believe that this is not happening, and has not happened for a long time in the UK. A decisive shift of some of our most able manpower into manufacturing must be looked for if the regeneration of industry is to be achieved and sustained.
1.2 Schools Education. The influence of the education system on the economic performance of the country has been an important theme in the current public debate on school education, in which representatives from both sides of industry have played a full part. The Secretary of State for Education and Science published in July 1977 a consultative document "Education in Schools" (dealing with England and Wales) which set out conclusions and proposals for further action. Among the points in this document which are particularly relevant to the industrial strategy are the following:
i. although there is some public criticism of the schools, there is no clear evidence of a general decline in standards. In some schools the curriculum may have become overloaded to the detriment of essential skills, including literacy and numeracy. No other aims should divert attention from these essential elements of the curriculum;
ii. the balance and breadth of the school curriculum in each local education area will be reviewed by local education authorities and their teachers, and industry and commerce will be involved in this process;
iii. schools need to do more to prepare pupils for the transition to adult and working life, in particular by equipping them with a basic understanding of the functioning of the economy and activities, especially manufacturing industry, which create the nation's wealth; iv. attention will be given to the development of methods of monitoring the performance of the school system, especially in English, mathematics and science;
v. various steps will be taken to improve the quality of the teaching force eg by requiring applicants to teacher training to have minimum qualifications in mathematics and English, and by developing in-service and induction training. (In this connection the Secretary of State recently announced a special programme to train serving teachers or unemployed qualified teachers in subjects important to the industrial strategy);
vi. encouragement will be given to the recruitment to teacher training of people who have had experience outside education;
vii. attention must be given in initial teacher training to acquainting teachers with the national importance of industry and commerce and to helping them to convey this to their pupils;
viii. local education authorities will in general need to develop more systematic approaches to the recruitment, career development, training and development of teachers, including procedures for assessment advice, and where necessary, early retirement;
ix. communications between employers, trade unions and the school need to be improved especially at the local level. Joint efforts should relate to such matters as improving understanding of the importance to our national life of productive industry and trade; the provision of work experience as part of a school course; increased opportunities for people in industry to visit schools, and teachers and pupils to visit factories; and the appointment of managers and trade unionists from industry as governors of schools;
x. local education authorities, schools and industry should consider together how careers guidance can best be developed to ensure that young people get correct and up-to-date information about jobs and training opportunities in local industry. Many schools will need to adjust their priorities to make room in the curriculum for careers education for all pupils not later than the age of 13. 1.3 Higher Education. As far as higher education is concerned, the evidence suggests that the intake by manufacturing industry of graduates falls short in both quality and quantity. The recently published consultation document, "Industry, Education and Management", reviews in detail some of the evidence for reaching such a conclusion. Many SWPs have also drawn attention to shortages in the supply of skilled manpower, particularly qualified engineers and scientists.
1.4 While there has been a substantial increase in the output of graduates entering employment over the past 25 years, the proportion entering employment in the manufacturing sector has decreased from a 1961 peak of 41% to 25.9% in 1975. The actual number of graduates recruited by industry has increased over the same period from 4611 to 6098, but in recent years has varied widely from year to year, reflecting such factors as the fluctuations in the economic cycle and the fall in employment in the manufacturing sector: the general level of recruitment in the 1970's has been lower than in the peak years of the late 1960's (8238 in 1969). These figures do not, however, reveal the final destination of the very large number of graduates who do not directly enter employment. The table below summarises an attempt to identify the sectors entered by all of those 1971 graduates known to have entered employment in the United Kingdom whether after obtaining their first qualification or later. It still relates to only about two-thirds of all 1971 university graduates:
| Percentage entering: | | |-------------------------------|-------| | Public Service | 15 | | Education | 35 | | Manufacturing Industry | 15 | | Other Industry | 7 | | Commerce | 9 | | Other | 19 | | **Total** | **100**|
1.5 The evidence covering the supply to industry of highly qualified manpower is, however, complex and difficult to interpret. It must be noted, for example, that the stock of graduates in industry has risen markedly and that graduates are spreading into occupational levels not traditionally associated with them. Supply considerations are prominent among the matters covered in the recently published special report commissioned by the British Association for the Advancement of Science with Government support. The Government for its part is making a detailed factual study, making use of all available data including the experience of University Appointments Boards.
1.6 It is, however, generally agreed that the quality of the graduates recruited by industry should be improved; manufacturing industry in particular has not been attracting its proper share of the most able young people in the country. Engineering graduates, of whom the large majority take jobs in industry, have tended in the past to have on average poorer A level qualifications than those in most other subjects. While industry gets its full share of the more able amongst these graduates, a variety of factors including social attitudes and the fluctuating patterns of recruitment by industry have contributed to keeping the overall quality lower than it should be. There is, however, evidence that the trend is beginning to change. An apparent shift in attitude has led to both a marked upturn in the number of applications for courses in engineering and science in higher education, and an increased willingness on the part of graduates to seek employment in industry. There is also evidence that industrial recruitment now is steadier and more buoyant, while that of the public sector has abated. The institutions of higher education for their part have at present some spare capacity on the science and engineering side, and though this may be fairly quickly taken up, the opportunity exists for developing more courses with a clear industrial slant.
1.7 The long-term objectives for ensuring an adequate supply and use of highly-qualified manpower in industry must therefore be:
i. to increase the quantity and quality of the graduate output seeking industrial employment;
ii. for industry - particularly small and medium-sized firms - to alter its recruiting patterns to absorb more of the output of higher and further education; iii. to increase the account of industrial needs in the planning of degree courses in universities and polytechnics;
iv. to increase the knowledge and understanding of industry amongst teachers in higher education.
1.8 The following first steps towards these long-term objectives have been taken:
i. the DES has announced two financial incentives intended to attract able students into courses of particular value to industry:
a. a scheme (still to be worked out in detail) of industrial scholarships to be run in collaboration with industry. The full support of industry will be required if this scheme is to be successful, and the Government hopes that progress can be made as fast as possible;
b. a modification of the awards arrangements to enable employers to give students financial support up to £500 (in addition to present disregard of £185) without reduction of grant;
ii. in the post-graduate sphere priority is being given to the development of courses designed and run in close association with industry;
iii. a limited number of Universities, selected because they are strong in both engineering and management studies, are setting up first degree engineering courses of very high standard, with a pronounced orientation towards industry, designed for exceptionally able students who are likely to move into senior positions in industry.
iv. the UGC and the Council for National Academic Awards are also considering what kind of degree courses can best meet the needs of the growing number of students who will find their way into a broad range of jobs in industry not traditionally filled by graduates. 1.9 These are, however, only the first steps, and far-reaching changes in attitudes and practices may be required before the long-term objectives will be reached. The Government will give further consideration to these problems in the light of the statistical survey mentioned in paragraph 1.5 above, and the British Association's report. The enquiry under Sir Montague Finniston into the engineering profession which was announced on 4 July will also be relevant.
1.10 Education and Training for Industry. Industrial training is central to the industrial strategy and largely falls outside the scope of this paper. However, an increasing amount of training is carried out in colleges of further education. One of the most important areas in this respect is technician training. The Training Services Agency (TSA) have recently launched courses for technicians in electronics and computer maintenance (amongst other specialisms) and advised industrial training boards (ITBs) on developing a strategy for technician training. Moreover, the Manpower Services Commission (MSC) Review and Plan shortly to be published envisages giving high priority to extending the range of technician courses particularly where these can be linked to the industrial strategy.
1.11 The main contribution of the national network of some 700 further education (FE) colleges is in the primary education of technician, craft and operative personnel for industry providing courses leading to technician and other qualifications. The FE sector also contributes to the training and retraining of industrial personnel - by short intensive courses mounted at the request of firms or groups of firms, and by the FE element in MSC and TSA programmes. Colleges will provide courses to meet demand as they perceive it and as needs are identified and brought to their attention by, notably, employing organisations, the MSC, the ITBs and the various Regional Advisory Councils for Further Education; and these arrangements will call for the closest co-operation.
1.12 At present the further education sector is meeting the buoyant demand for vocational courses and appropriate curricula developments are being encouraged. It is also making a substantial contribution to management and trade union education. Much closer working between education and training is being promoted in relation to Training Opportunities Scheme and ITB courses, by means of the "unified vocational preparation" schemes jointly fostered by DES and the TSA, and in respect of the new Youth Opportunities Programme.
1.13 Public Sector Manpower Policy. Many SWPs have expressed concern that the public sector is absorbing too great a share of able manpower, particularly the well-qualified. So far, the Government has not sought to adjust the intake of qualified manpower to the public sector on the grounds of its impact on the supply available to industry.
1.14 As far as graduates are concerned, the proportion directly entering employment who entered the public services (excluding education) rose from 14.8% in 1965 to 26.2% in 1975 but fell back to 21.1% in 1976. The recent decrease in the intake of graduates by the public sector caused by public expenditure constraints has been associated with (although not necessarily the sole cause of) an increased number of graduates seeking industrial employment.
1.15 Statistics relating to other qualified people entering public services are not available, but estimates based on the 1971 Census of Population suggest that whereas 47 per cent of those with degree and equivalent qualifications are employed in the public sector (ie public services plus nationalised industries) 60 per cent of those with qualifications not of degree level but usually obtained after the age of 18 (a high proportion of which are in teaching and nursing but also include HNC and HND) were employed in that sector, as were 28 per cent of those with GCE A level or equivalent qualification but no higher qualifications. For comparison, slightly over a quarter of the total population were employed in the public sector in 1971. The skills exercised at the technician and craft levels are much more specific and job-related than those possessed by newly-qualified graduates. The public and private sectors are, generally speaking, in competition for those people only at a point when they leave school and before they are trained. 1.16 SWPs have in particular argued that, in many cases, manufacturing industry is unable to compete with the pay and conditions offered by the public sector. If this were widely the case, there would be a formidable combination of market and cultural forces which would lead to the public sector pre-empting qualified manpower in disproportionate quality and quantity.
1.17 This is, however, an area where facts are difficult to establish, where care must be taken to examine comparable jobs, and where generalisations are unlikely to be valid. It is also necessary to take account of the relativities between manufacturing industry and other parts of the private sector.
1.18 The Government believes that there is reason to be concerned at the possibility of pre-emption by the public sector of resources of able manpower at the expense of industry. It considers that much more account must now be taken in public sector manpower policies of their implications for the supply of labour to industry, and of relativities between the public sector and industry where they are competing for the same type of manpower. It proposes to conduct a more searching examination of the facts about public sector recruitment of qualified manpower (including pay relativities and other factors).
1.19 Incentives to Work. It is important from an industrial viewpoint that the taxation system does not distort the labour market to the extent that the normal wage structure fails to provide an adequate incentive to work and to gain skills and promotion. Yet there is widespread feeling - at all levels - that the present taxation system has weakened the incentive to work throughout the economy.
1.20 As far as the lower end of the labour market is concerned, a problem which has received much attention recently is that of the relationship between social security and welfare benefits for those out of work and earnings in work. This problem is limited in size, and its effects have been exaggerated. But situations do exist in which the net income of those unemployed or absent through sickness can, at least for a period, exceed their net earnings while in work, and in which, for others, the net additional reward from working is very small. This problem is caused not only by the level of benefits, but also by features of the tax system (low thresholds, and refunds f tax for those out of work). As well as the disincentive effect on those not in work, the perception of this problem can be demoralising for those in work. The Government is taking steps to reduce any such disincentive to work by tax reductions and by improvements in child benefits and similar measures when this is possible.
1.21 A closely related, but separate, problem is that of the "poverty trap" which affects those in work, and which flows from the combination of current taxation levels and means-tested benefits. This does not in practice mean, as is widely supposed, that those affected derive no net benefit from normal pay increases, because the income limits for means-tested benefits are regularly uprated and thus move up as pay moves up. But it does mean that there is a wide band of low earnings over which net income increases little if at all. For example, for a married man with 2 young children claiming all the available benefits, total net income does not increase at all between gross earnings of £30 and £45 a week, and increases by less than £5 between £45 and £60. There is therefore little incentive in this income range for a worker to increase his earnings - for example through working overtime, or through gaining skills or promotion, or through a change of job.
1.22 There has been a long-term tendency for differentials in post-tax pay between skilled and less skilled work to be compressed. As far as managerial pay is concerned, several surveys have shown that managerial pay, in the UK, is in general substantially lower than in other major industrial countries; though a large part of this simply reflects the overall difference in GDP per head, it has undoubtedly made overseas employment and emigration increasingly attractive to the more mobile and talented managers. The DOI's contacts with both US and UK multinationals confirm that they are having increasing difficulty in persuading UK nationals to return to the UK after service abroad because of the weight of direct taxation and lower salaries common here.
1.23 International comparisons of income taxation are never straightforward, partly because of the difficulty of establishing an acceptable basis of currency translation and partly because of the variation in the distribution of earnings. Despite the insurance principle which may underlie them, employee's social security contributions are generally regarded by those who pay them as part of the income tax system, and in other countries are used to finance expenditure on items which in the UK are paid for out of general taxation. Although the UK income tax has a low threshold and high onset rate compared with other countries, the low rate of employees' social security contributions means that a married man with two children earning half the average production workers' wage will be paying out roughly the same percentage of his income in tax and insurance as his counterparts in other countries. However, at average earnings and above his tax and social security deductions together make up a larger percentage of gross pay in the UK. At average earnings, for example, he surrenders 23% of his income in tax and social security payments, at a marginal rate of 34%, while the equivalent tax payer in France pays only 4%, in Germany 22% and in the USA and Japan about 15% (including local income tax where appropriate). At five times average earnings he surrenders nearly 50% of his income in tax and social security payments, at a marginal rate of 75%, while the equivalent tax payer in France pays only 20% and in Germany, the USA and Japan between 35 and 40% (including local income tax where appropriate). At these levels of earnings the Netherlands is closest to the UK with about the same average rate but a slightly lower marginal rate. Only in Sweden are marginal and average deduction rates higher than in the UK.
1.24 The long-term objective must be to restore a situation in which - at all levels - the labour market can operate effectively and provide adequate incentives to work, while continuing to give protection to the poorer members of society. The inter-relation of social security benefits and tax is, however, an area of great complexity, where generalisations can be facile and where solutions may be difficult to find.
1.25 As stated in para 1.17 above the Government is already taking steps to deal with these problems. Moreover, the Chancellor of the Exchequer has given a commitment, as far as circumstances permit, to reduce the burden of income tax at all levels, and to increase the level of personal tax allowances to the point where they stand above the levels of the main social security benefits. The Government intends to give further consideration to the question how far the interaction of the tax and social security system creates disincentives to work at lower levels of earnings. 2. Mobility of Labour
2.1 The Government remains committed to its efforts to ensure through regional policy that jobs can go to workers in areas of high unemployment. But even in an economy with no regional imbalances, it would remain necessary to ensure that workers with particular skills can easily move to the particular vacant jobs requiring those skills. Even with the present high levels of unemployment, many cases are being reported by SWPs of shortages of key skilled workers. The machinery exists in the Employment Service Agency for circulating particulars of vacancies and of available labour throughout the country and this machinery is at present being modernised using the latest computerised techniques.
2.2 Housing and Industrial Mobility. Housing policy can greatly assist industrial regeneration by making it easier for people to move house to new jobs. This was recognised in the recent Green Papers on housing policy. Many of its proposals will help; in particular, wider access to home ownership; more flexible allocations and transfer policies in the local authority sector (especially the ending of residential qualifications for access to waiting lists); further support for the growth of housing associations and new forms of tenure; and measures to sustain the supply of 'quick access' accommodation in the private rented sector. Local authorities will be encouraged to think comprehensively about the needs of labour mobility in preparing the new local housing strategies each year; and central Government will be able to take their proposals into account in allocating capital resources. A pilot scheme is being set up to link local authority housing with vacancies for key workers so that these can be advertised by the ESA in other areas with an offer of local authority accommodation; and the Royal Commission on Legal Services is examining the cost of conveyancing of owner-occupied houses.
2.3 Transferability of Pensions. While there are no statutory obstacles to voluntary transfer of pension rights, there are certain practical difficulties which may, in some cases, impede occupational labour mobility. The Secretary of State for Social Services intends to invite the Occupational Pensions Board to study the question of transferability as soon as practicable.
1Housing Policy: A Consultative Document Cmnd 6851 Scottish Housing: A Consultative Document Cmnd 6852 3. Employment Legislation
3.1 Recent years have seen a large amount of employment legislation, such as:
- Equal Pay Act, 1970;
- Industrial Relations Act, 1971;
- Contracts of Employment Act, 1972;
- Employment and Training Act, 1973;
- Health and Safety at Work Act, 1974;
- Trade Union and Labour Relations Act, 1974 and 1976;
- Sex Discrimination Act, 1975;
- Employment Protection Act, 1975.
Proposals for occupational pensions and industrial democracy legislation are also under consideration (and progress towards industrial democracy in some industries is already well advanced).
3.2 The Government is convinced that its major reforms are both necessary and desirable. If employees - and unions - feel more secure, they are more likely to co-operate to increase productivity and efficiency. However, the Government will take full account of the volume of measures carried by both Conservative and Labour Administrations in considering any fresh proposals which come forward for further legislation in this field. The Department of Employment has also arranged for two pieces of research to be carried out on the impact of recent measures on employers, in particular to establish whether there is validity in the view that these measures have made employers more reluctant to take on new labour.
CAPITAL
4. Cost and availability of capital
4.1 Since last autumn, interest rates have fallen very substantially; by about 10.0% at the short end and about 5% at the long end by October. The main questions relating to the cost and availability of capital are kept under review by the Roll Committee, and the Wilson Committee is examining the whole area of institutional arrangements for providing finance for industry; therefore these are not discussed in this paper. The Government is, however, concerned that the banks should show a proper understanding of the needs and importance of industry, just as (as is discussed elsewhere in this paper) it is concerned that the civil service and education should show a proper understanding of industry. The Government therefore wishes to see an increasing involvement of the banks in the industrial strategy and welcomes the addition of bank representatives as members of SWPs.
5. **Taxation**
5.1 Detailed questions on taxation (such as the future of the stock relief scheme) are not appropriate to a discussion of the wider implications of the industrial strategy. However, it is appropriate here to emphasise that the Government's long-term taxation objectives include:
i. maintaining stability and continuity of the corporate tax system, to strengthen business planning and confidence;
ii. reducing the burden of direct personal taxation at all levels, and achieving a better balance between direct and indirect taxation;
iii. reducing the complexity of the tax system (which at present places a heavy administrative burden on industry and on Government).
Moreover, the Government considers it an important objective to create an environment which promotes innovation (eg by measures to assist small firms). These objectives constitute an appropriate fiscal background to the industrial strategy.
5.2 It is worth noting that by international standards the tax burden borne by the corporate sector is comparatively low. The real burden of corporation tax proper is generally not heavy, largely because of the impact of stock relief; and, moreover, the social security contributions payable by the employer in respect of his workforce are much lower than in most other European countries. This contrasts with personal income taxation where the UK levies a high burden by international standards. 6. **Company Reporting**
6.1 The Government has supported the Sandilands Committee recommendation that current cost accounting should become the basis for the preparation of company accounts, as giving companies a better and more realistic view of their transactions than historic cost accounting. At the same time the Government has emphasised the importance of ensuring that the new system is practicable, which means that it must be kept simple to operate, especially for smaller companies and their accountants. In balancing the requirements for precision and simplicity, the Government will continue to encourage the accounting profession to avoid proposals which place too great a burden on companies.
6.2 There are also proposals for other aspects of company reporting in the Green Paper just published by the Secretary of State for Trade. This recognises that there may be a case for imposing less onerous requirements on small firms, but again it will be necessary in reaching decisions to balance the case for a particular disclosure requirement against the extra work which companies will face in collecting and publishing the information.
**PRODUCTION AND DISTRIBUTION**
7. **Infrastructure**
7.1 **Planning and Land.** A number of SWPs have drawn attention to the danger that planning procedures may obstruct the industrial strategy, either because too little priority is placed on the need for industrial development or because of the slowness and complexity of planning procedures (which, it has been alleged, delay industrial development much more than is the case in other countries). The Government has taken the following steps:
i. as described in the paper put to the Council in July by the Secretary of State for the Environment, it has asked local authorities now to give industry top priority in the handling of planning applications and in making land available for development and to be particularly sensitive to the needs of small firms in both urban and rural areas; ii. as far as the Department of the Environment itself is concerned, matters relating to industrial development, including appeals and building regulations jurisdiction, will now be given first priority. While average times for the handling of planning appeals by the Department have almost halved in the last two years, the Government is determined to achieve an even greater improvement. The Department therefore proposes for the future to give priority to the handling of all industrial planning appeals. It also aims to transfer to inspectors all industrial planning appeals relating to buildings up to 1500 sq metres, as opposed to the existing upper limit of 500 sq metres. With these changes, the Department considers that it could work to a period of 5 months as the normal maximum for the handling of most industrial planning appeals, with not more than about one case in five exceeding that figure. That proportion cannot be eliminated because the handling of a planning appeal depends on co-operation by the local authorities and the applicant, and also on the amount of local opposition that may be generated. Highly contentious or large applications for industrial planning permission are often called in by the Secretary of State as the most satisfactory way of handling them. The times for such cases are not included in the references above and they would normally exceed five months. Special considerations apply also to mineral extraction cases. Steps are being taken within DOE to speed up the handling of such cases but many of them are complex and will continue to present difficulties;
iii. the Secretary of State for Scotland has published a consultation paper on the general operation of the planning system in Scotland: this includes possible means of speeding up the handling of planning applications. He also proposes discussions with the local authorities, STUC and CBI on the industrial strategy which will include, among other things, consideration of the ways in which the planning system might assist industry;
iv. similar steps to those of DOE are being taken by the Secretary of State for Wales. 7.2 The Government is considering whether research can be undertaken to monitor the effects of the above measures.
7.3 Industrial Development Certificates (IDC's) and Office Development Permits (ODP's). While the Government is committed to retaining these instruments as an essential part of regional policy, it made relaxations in the IDC scheme in 1976, and has now announced relaxations in the ODP scheme (which also impinges on manufacturing industry). It undertakes to operate both schemes in as flexible as possible a manner in the interests of the industrial strategy.
7.4 Building Regulations. Industry also has a close interest in the speedy handling of applications for building regulations approval. Work is at present being undertaken:
i. to develop a more flexible and time-saving procedure for building regulation;
ii. to examine the scope for rationalisation of the building regulations and other legislation relating to buildings, particularly in respect of measures against fire.
7.5 Roads. One of the principal objectives for future transport policy set out in the Government's White Paper (Cmnd 6836) is to contribute to economic growth and higher national prosperity by giving industry and other sectors of production an efficient transport service. To this end the Government will give priority within the national road programme to improvements on routes which serve the main industrial areas and the ports. Industrial traffic will also benefit from the road schemes chosen to serve regional needs and those designed to take heavy traffic out of built up areas. As far as local Government is concerned, authorities have been asked by the Government to reflect the priority for industry in their traffic management policies and in their choice of road schemes.
7.6 Public Transport. Adequate public transport services are essential if the labour force is to be properly matched with available employment, and if shift working is to be feasible. In its White Paper on Transport Policy, the Government re-affirms its belief that the maintenance of an effective network of bus services is an important aim of its transport policy and makes provision for a substantial and Continuing commitment to financial support. The White Paper rejects any notion of imposing major cuts in the railway system, and sets out the main tasks for the railways, of which the carriage of people to and from work in London and the major conurbations, and the carriage of bulk freight especially between sidings, are particularly material to this paper.
8. Production and Distribution Costs
8.1 Pollution Policy. The UK's geography and climate gives it an environment which can more easily absorb and disperse pollution than the environments of many continental countries. In order to protect this natural competitive advantage, the Government re-affirms its determination to work for the retention of the existing UK quality objectives approach, which is preferable in the circumstances of the UK on both economic and environmental grounds to uniform emission standards.
8.2 As far as existing UK practices are concerned, the Government does not consider that these in general are imposing an unreasonable burden on industry. However, there may have been cases where too abrupt changes or inconsistent decisions have been to the detriment of industry. The Government:
i. has asked local authorities to cease imposing planning conditions in an attempt to deal with problems which are the subject of controls under separate legislation;
ii. will make greater efforts to keep export industries in touch with international moves towards higher environmental standards.
8.3 Energy Policy. General energy policy issues have recently been the subject of separate discussion in NEDC. A Green Paper on Energy Policy will be published later this year.
8.4 A matter of concern to a number of SWPs has been that of energy pricing policy. In general, the Government considers that the prices to industry of electricity, coal, gas and oil do not compare unfavourably with price levels in other European countries, and that the objective of proper economic pricing is in the best long-term interests of industry as well as the economy in general. 8.5 It is sometimes argued that, in order to hold down prices for the domestic sector, there has in the past been a degree of cross-subsidisation within energy tariffs and prices against industrial consumers. In fact for a number of years both domestic and industrial tariffs were well below economic levels. The move towards proper economic pricing has, however, been accompanied by a better general balance between industrial and domestic prices and tariffs. The Government welcomes this move, and would not wish for the future to see discrimination against industrial consumers.
8.6 The real price of energy is, however, bound to rise over the longer term. The return to industry from energy conservation projects is therefore equally certain to be increasingly large. The Government hopes that the Council will use its influence to persuade industrialists of the benefits for them, as well as for the nation, in undertaking investment in energy conservation.
8.7 Transport Costs. Two EEC issues could have important consequences for transport costs:
i. the new proposals for harmonization of maximum permitted lorry weights and dimensions (which, if agreed, would reduce the costs of road freight and facilitate exports of lorries);
ii. the introduction of EEC rules on commercial drivers' hours (the increase in costs will be severe unless we can achieve the staged programme of implementation for which we are negotiating).
The Government will attach particular importance to the industrial implications in its approach to these two issues.
8.8 The Government's intention to increase taxation on heavy lorries is in line with the principle of covering full economic costs. However, it will continue to give full consideration to the views of industry in deciding on the pace of increase in this taxation. 8.9 Water Charges. Water authorities are under a statutory obligation to set charges high enough to break even. They are also required to fix charges with regard to costs, and to avoid undue discrimination between different classes of consumers. This effectively precludes them from discriminating in favour of industry: nor is it reasonable that they should, since they could only do so at the expense of the domestic consumers for whom water services charges are already a sensitive issue in the context of counter-inflation policy. Some industries have complained of particular difficulties arising from increases in trade effluent charges, especially where charges had been kept artificially low in the past and are now being increased as a result of the general move towards equalisation within regions (agreed in principle with the CBI). These industries are considering jointly with the water industry ways and means of solving these problems.
9. Research and Development
9.1 A number of recent policy initiatives have borne out the Government's determination to encourage R&D in industry. Selective assistance, under Section 8 of the Industry Act 1972, has included provision for product development assistance, and this is being extended under the Process and Product Development Scheme announced on 18 July. On a smaller scale, the Manufacturing Advisory Service announced in April, to which £8 million has been allocated over 5 years, will help smaller and medium sized firms in manufacturing industry, especially those engaged in metal working and assembly, to make better use of proven technologies.
9.2 Through such schemes the Government aims to assist industry to carry through its own research and development. Through the National Research Development Corporation (NRDC) assistance is already available both to industry and to private individuals for research into and development of inventions. The management of the Government's own research and development also has an important role to play. In the research council sphere special efforts are being devoted to the development of research in areas likely to be of special value to industry. For example, in science the resources devoted to "big science" (high energy physics, astronomy and space science) are being cut back by 25% to preserve scope for initiative in other fields (eg polymer engineering, marine technology and mineral exploration). 9.3 The eight Requirements Boards which commission research work on behalf of the Department of Industry aim to increase the number of contracts placed in industry or industry supported research associations, rather than "in-house". In aggregate the Boards plan to commission from industry 40% of the work over the next few years. This can be compared to the following proportions over the last 4 years:
| Year | 1973-74 | 1974-75 | 1975-76 | 1976-77 | |--------|---------|---------|---------|---------| | | 12.7% | 12.9% | 17.2% | 21.9% |
Some work will of course continue to be done by the Department's own Industrial Research Establishments. However, the Government recognizes the importance of getting the fruits of this work out into industry for industry to develop as early as possible.
9.4 Moreover, all Government departments which sponsor technical developments have been asked to review arrangements to ensure that as much as possible of the work is done in industry rather than "in-house".
9.5 The Advisory Council on Applied Research and Development (ACARD) has now been established under the Lord Privy Seal's chairmanship. Its work programme is specifically directed towards the industry-related aspects of R&D. It will, inter alia, be considering the Government's role as a commissioner of R&D and how full industrial benefits can be gained from this.
SALES
10. Marketing 10.1 Metrication. The Government has now put forward a metrication programme as a basis for consultation, and recognizes the industrial importance of the implementation of metrication being completed as rapidly as possible.
10.2 Standardization. The Government is urgently following up the recommendations addressed to it in the Warner Report, which will be the subject of a separate report to the Council. 10.3 Consumer Protection. In general consumer protection measures operate at the point of sale and thus have no direct effect on manufacturing industry. Proposals on product liability, under which producers would be automatically liable for damage caused by their products, may have implications for insurance cover needed by manufacturers in certain sectors (notably pharmaceuticals, machine tools, motor cars), but at present there is insufficient evidence to quantify the effect in relation to other costs.
11. Public Purchasing
11.1 The scope for further increases in the proportion of public purchases made from UK manufacturers is limited, given that nearly 95% by value of current purchases are made from UK manufacturers (excluding raw materials where certain imports are inescapable and international defence collaborative projects which are designed to be self-balancing). However, the Government:
i. is looking for ways of reducing yet further the amount of public purchases which come from abroad;
ii. will consider ways in which the UK content of purchases from UK suppliers can be maximised.
11.2 An area in which greater progress can be looked for is that of the impact of standards and specifications on the export potential of products purchased by the public sector. Attention has been focused on problems here by the Warner and Brown Reports, as well as by SWP reports. The Government is determined to make substantial progress here, and hopes that industry will take every opportunity to draw attention to the possibilities of concrete action in specific areas.
11.3 The Warner Report noted a number of specific areas whose export potential might thus be enhanced. By way of a pilot exercise, the Department of Industry proposes to examine in detail the supply of broadcasting equipment. The Department will discuss with purchasers and manufacturers whether there is scope for export efforts to be improved by action along the lines recommended in the Warner Report. BUSINESS ENVIRONMENT
12. Competition Policy 12.1 Competition policy has an important role to play, as part of the industrial strategy, in improving the performance of British industry. The Government is reviewing the operation and effectiveness of competition policy in achieving this objective through the existing legislation and institutions.
13. Relations with Government 13.1 Civil service/industry mobility. It is widely held that the British practice of offering a full life career in the Civil Service, and of little mid-life recruitment, leads to a lack of mutual understanding between the Service and industry, and therefore a failure to give enough weight to industry's interests and concerns when policy is being formulated. Recognising that there is a degree of truth in this, the Government and the CBI alike for more than a decade have accepted interchange postings between the Civil Service and industry as an aim of policy. By continuous effort on both sides something has been achieved, but not on a large scale.
13.2 Between 1973 and 1975, for instance, some 35 civil servants have undertaken exchange postings to industry and commerce, and similarly some 70 people from the private sector have done spells in the Service - mainly at middle management level. On top of these figures, some 60 recruits via the direct entry Principal competition have joined the Service in the last 5 years in mid-life after industrial and commercial experience. Despite strong opposition from the Civil Service unions this line of recruitment is being maintained even in present circumstances of manpower cuts. Its benefits are cumulative, and nearly all of those recruited stay in the Service, so the total from this background continues to grow. Further industrial and commercial experience has also been imported by recruitment from outside for posts where specific prior experience is necessary or highly desirable.
13.3 Nevertheless, the Government considers that it is very important to achieve a much higher degree of interchange between the Civil Service and industry, and to promote a much greater degree of mutual understanding on both sides. Although there are very real difficulties in arranging exchange postings, they represent the best short-term prospect of further improvement. The Government therefore proposes to achieve a sharp and substantial increase in the number of civil servants seconded to industry. More secondments of businessmen into the Civil Service would also be desirable (although the flow of secondments need not balance either locally or generally). This is likely to prove more difficult than secondments in the other direction because able businessmen run greater risks than civil servants of jeopardising their careers if they leave them for crucial periods, and problems of pay and conflict of interest can also arise. To attain these two objectives the Government intends to aim to at least double the number of civil servants seconded to industry by the end of the decade and to ensure that by then the total number of exchanges in operation in both directions at any one time will be approaching 200. This will require the active co-operation of all departments, and hence of a very wide spread of industrial and commercial employers; and the Government proposes to hold talks with the CBI and leading firms to secure their assistance in achieving the substantial increases which are needed.
13.4 There are attractions in making the secondments rather shorter than the usual 2-3 years. This can usefully increase the number of people who have had direct experience in commerce and industry, while also reducing the degree of sacrifice the parent organisation has to make. This change can be associated with linking the secondment to a specific project, which has a number of advantages. This approach has already been tried successfully on a small scale. It could well be a significant component in the further expansion of secondments. The use of joint seminars (which have already proved useful) will be extended. The wider use of training processes, within the Service or in co-operation with the business school, is in hand.
13.5 However, the Government considers that the question of civil service/industry mobility requires further consideration in the longer term. This may involve rethinking of issues which go much wider than the matter of secondments.
13.6 Burdens on industry. It is frequently alleged by industrialists that the cumulative burden of Government requirements - such as collection of information, the complexity of the tax system, planning delays and legislative requirements - imposes unreasonable costs on industry, particularly on smaller firms, and damages efficiency. The Government therefore proposes, as a first step, to arrange for a fact-finding exercise to be carried out to assess the total burden of Government legislative and administrative requirements on some representative firms. CABINET
THE QUEEN'S SPEECH ON THE PROROGATION OF PARLIAMENT
Note by the Secretary of the Cabinet
I attach for the information of the Cabinet copies of The Queen's Speech on the Prorogation of Parliament in the form in which it has been submitted to the Counsellors of State for approval on behalf of The Queen.
Signed JOHN HUNT
Cabinet Office
20 October 1977 DRAFT PROROGATION SPEECH
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS,
My husband and I look back with delight and gratitude on the events which marked My Silver Jubilee at home and overseas, and the visits which we made to many parts of the United Kingdom and the Commonwealth.
I was pleased to welcome Commonwealth leaders in London for the 1977 Commonwealth Heads of Government Meeting, for which My Government were the hosts. The intensive and friendly discussions there strengthened the Commonwealth relationship and contributed towards the solution of certain international problems.
My Government played an active and constructive part in the activities of the European Communities, which included two meetings of the European Council, one in London, and held the Presidency of the Council of Ministers for the first six months of 1977.
My Government have played a full and positive role in institutions to promote international development and efforts to create a more just and stable economic order, and in discussions on the problems of world unemployment and inflation; they were hosts to the Downing Street Conference of the leaders of the seven major industrialised countries.
Legislation has been passed to enable the United Kingdom to ratify amendments to the Articles of Agreement of the International Monetary Fund and to assist United Kingdom trade and the provision of aid for the poorest countries. Special assistance has been given to southern African refugees.
My Government have continued their efforts to promote a negotiated settlement in Rhodesia. My Government have been active, in co-operation with other Western members of the Security Council, in working for a settlement in Namibia which will bring the country to independence in a manner which will meet with international acceptance and will give the people a chance to select freely their own government.
My Government have continued to attach importance to the development of detente, and of constructive political and economic relations, with the Soviet Union and the countries of Eastern Europe. They have continued to work for mutual and balanced force reductions in Central Europe. They are participating with the Governments of the United States and the Soviet Union in discussions aimed at the negotiation of a Comprehensive Test Ban Treaty.
My Government were pleased to act as hosts at the Ministerial Meeting of the North Atlantic Council which was attended by Heads of Government in London in May, and which established new programmes of work in the political and defence fields.
MEMBERS OF THE HOUSE OF COMMONS, I thank you for the provision which you have made for the honour and dignity of the Crown and for the public services.
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS, My Government have given continuing priority to their policy of restraining price levels, and of the fullest possible co-operation to this end with both sides of industry. The second round of voluntary pay policy has been observed throughout the economy, and the way has been prepared for an orderly return to normal collective bargaining. Legislation has been passed to make new provision for the scrutiny and effective control of prices, and a new Price Commission has been appointed. Successful steps have been taken to restore confidence in the financial markets and improve the balance of payments. My Government remain deeply concerned about the continuing high level of unemployment, and have introduced additional employment and training measures to tackle this problem, including the youth opportunities programme.
My Government have maintained their policy of strengthening industry through the development of the industrial strategy, through industrial assistance schemes, and through the work of the National Enterprise Board and the Scottish, Welsh and Northern Ireland Development Agencies.
Legislation was enacted to bring into public ownership the aircraft and guided weapons, shipbuilding and marine engine building industries. British Shipbuilders have acquired by negotiation a major part of the ship-repairing industry.
An Act has been passed to enlarge the Post Office Board so as to allow an experiment in industrial democracy.
Legislation has been enacted to give the National Coal Board additional powers and provide the framework for the further development of the coal industry, and to make further provision for the financing of British Nuclear Fuels Limited and the Radiochemical Centre Limited. My Government are completing the award of licences, all involving majority state participation, under the Fifth Round of off-shore petroleum licensing.
Steps have been taken to ensure further safeguards in the management of nuclear waste, and full and public consideration of the problems relating to nuclear development; a public inquiry has been set up to examine the proposal for the construction of an oxide fuel reprocessing plant at Windscale.
Legislation has been passed extending United Kingdom fishery limits to 200 miles; tribute is due to the hard work of the fishery protection units in enforcing the new limits. A new and favourable Air Services Agreement with the United States of America has been signed.
An Act has been passed to reform patent law and to make possible the United Kingdom's participation in certain international agreements including the European Patent Convention.
In Northern Ireland the Royal Ulster Constabulary, supported by My Armed Forces, have continued to enforce the law with impartiality and deserve the highest praise for their success in reducing the level of violence. My Government have maintained the aim of a just and lasting constitutional settlement, and they have taken measures to combat the economic and social problems in the Province, including new incentives for investment.
My Government have published Green Papers discussing possible changes in the arrangements for financing local authorities.
My Government have continued to develop a housing policy designed to deal more effectively with the most pressing needs and to broaden housing opportunities. Proposals have been published for a comprehensive housing policy for the longer term, and legislation has been enacted to place statutory responsibility for assisting the homeless on local housing authorities.
My Ministers have announced new initiatives for the regeneration of inner urban areas, including the expansion and adaptation of the urban programme and the offer of partnership arrangements between central government and selected local authorities.
Proposals have been laid before you for strengthening the water industry and for the future of the British Waterways Board.
My Government have reviewed the development programme of new towns in England and have established a new programme for their completion. My Government have published a White Paper setting out their proposals for the future development of transport policy to meet economic and social needs. An Act has been passed to provide continued financial support to the British Railways Board and the National Freight Corporation.
Provision has been made for increases in social security benefits and war pensions. Legislation was enacted making a number of changes in the field of social security, including supplementary benefit. The new Child Benefit was brought into payment for all children, including the first.
My Government have continued to promote and encourage voluntary effort and a sense of caring in the community and have launched and will sustain a Good Neighbour Campaign aimed at involving the community in the care of its members. I hope that the community spirit fostered by the celebrations of My Jubilee will be strengthened and developed in the years to come.
My Government have published a Green Paper setting out proposals on education in schools, with particular regard to the curriculum, standards of performance, the training and employment of teachers and the preparation of pupils for the needs of adult life.
An Act has been passed to amend the criminal law, particularly in relation to conspiracy, and to improve its administration; and the process of reforming the law has been continued with the Administration of Justice Act and other measures.
My Government welcome the passage of the Unfair Contract Terms Act, which marks an important advance in consumer protection. Grants have been made to maintain the provision of help to consumers.
Among the Acts passed in relation to Scotland were measures concerned with the modernisation of the law of marriage and with the enforcement of planning procedures.
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS, I pray that the blessings of Almighty God may attend you. THE QUEEN'S SPEECH ON THE PROROGATION OF PARLIAMENT
WEDNESDAY 26TH OCTOBER, 1977
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS,
I was pleased to welcome Commonwealth leaders in London for the 1977 Commonwealth Heads of Government Meeting, for which My Government were the hosts. The intensive and friendly discussions there strengthened the Commonwealth relationship and contributed towards the solution of certain international problems.
My Government played an active and constructive part in the activities of the European Communities, which included two meetings of the European Council, one in London, and held the Presidency of the Council of Ministers for the first six months of 1977.
My Government have played a full and positive role in institutions to promote international development and efforts to create a more just and stable economic order, and in discussions on the problems of world unemployment and inflation; they were hosts to the Downing Street Conference of the leaders of the seven major industrialised countries.
Legislation has been passed to enable the United Kingdom to ratify amendments to the Articles of Agreement of the International Monetary Fund and to assist United Kingdom trade and the provision of aid for the poorest countries. Special assistance has been given to southern African refugees.
My Government have continued their efforts to promote a negotiated settlement in Rhodesia.
My Government have been active, in co-operation with other Western members of the Security Council, in working for a settlement in Namibia which will bring the country to independence in a manner which will meet with international acceptance and will give the people a chance to select freely their own government.
My Government have continued to attach importance to the development of detente, and of constructive political and economic relations, with the Soviet Union and the countries of Eastern Europe. They have continued to work for mutual and balanced force reductions in Central Europe. They are participating with the Governments of the United States and the Soviet Union in discussions aimed at the negotiation of a Comprehensive Test Ban Treaty. My Government were pleased to act as hosts at the Ministerial Meeting of the North Atlantic Council which was attended by Heads of Government in London in May, and which established new programmes of work in the political and defence fields.
MEMBERS OF THE HOUSE OF COMMONS,
I thank you for the provision which you have made for the honour and dignity of the Crown and for the public services.
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS,
My Government have given continuing priority to their policy of restraining price levels, and of the fullest possible cooperation to this end with both sides of industry. The second round of voluntary pay policy has been observed throughout the economy, and the way has been prepared for an orderly return to normal collective bargaining. Legislation has been passed to make new provision for the scrutiny and effective control of prices, and a new Price Commission has been appointed. Successful steps have been taken to restore confidence in the financial markets and improve the balance of payments.
My Government remain deeply concerned about the continuing high level of unemployment, and have introduced additional employment and training measures to tackle this problem, including the youth opportunities programme.
My Government have maintained their policy of strengthening industry through the development of the industrial strategy, through industrial assistance schemes, and through the work of the National Enterprise Board and the Scottish, Welsh and Northern Ireland Development Agencies.
Legislation was enacted to bring into public ownership the aircraft and guided weapons, shipbuilding and marine engine building industries. British Shipbuilders have acquired by negotiation a major part of the ship-repairing industry.
An Act has been passed to enlarge the Post Office board so as to allow an experiment in industrial democracy.
Legislation has been enacted to give the National Coal Board additional powers and provide the framework for the further development of the coal industry, and to make further provision for the financing of British Nuclear Fuels Limited and the Radiochemical Centre Limited. My Government are completing the award of licences, all involving majority state participation, under the Fifth Round of off-shore petroleum licensing. Steps have been taken to ensure further safeguards in the management of nuclear waste, and full and public consideration of the problems relating to nuclear development; a public inquiry has been set up to examine the proposal for the construction of an oxide fuel reprocessing plant at Windscale.
Legislation has been passed extending United Kingdom fishery limits to 200 miles; tribute is due to the hard work of the fishery protection units in enforcing the new limits.
A new and favourable Air Services Agreement with the United States of America has been signed.
An Act has been passed to reform patent law and to make possible the United Kingdom's participation in certain international agreements including the European Patent Convention.
In Northern Ireland the Royal Ulster Constabulary, supported by My Armed Forces, have continued to enforce the law with impartiality and deserve the highest praise for their success in reducing the level of violence. My Government have maintained the aim of a just and lasting constitutional settlement, and they have taken measures to combat the economic and social problems in the Province, including new incentives for investment.
My Government have published Green Papers discussing possible changes in the arrangements for financing local authorities.
My Government have continued to develop a housing policy designed to deal more effectively with the most pressing needs and to broaden housing opportunities. Proposals have been published for a comprehensive housing policy for the longer term, and legislation has been enacted to place statutory responsibility for assisting the homeless on local housing authorities.
My Ministers have announced new initiatives for the regeneration of inner urban areas, including the expansion and adaptation of the urban programme and the offer of partnership arrangements between central government and selected local authorities.
Proposals have been laid before you for strengthening the water industry and for the future of the British Waterways Board.
My Government have reviewed the development programme of new towns in England and have established a new programme for their completion. My Government have published a White Paper setting out their proposals for the future development of transport policy to meet economic and social needs. An Act has been passed to provide continued financial support to the British Railways Board and the National Freight Corporation.
Provision has been made for increases in social security benefits and war pensions. Legislation was enacted making a number of changes in the field of social security, including supplementary benefit. The new Child Benefit was brought into payment for all children, including the first.
My Government have continued to promote and encourage voluntary effort and a sense of caring in the community and have launched and will sustain a Good Neighbour Campaign aimed at involving the community in the care of its members. I hope that the community spirit fostered by the celebrations of My Jubilee will be strengthened and developed in the years to come.
My Government have published a Green Paper setting out proposals on education in schools, with particular regard to the curriculum, standards of performance, the training and employment of teachers and the preparation of pupils for the needs of adult life.
An Act has been passed to amend the criminal law, particularly in relation to conspiracy, and to improve its administration; and the process of reforming the law has been continued with the Administration of Justice Act and other measures.
My Government welcome the passage of the Unfair Contract Terms Act, which marks an important advance in consumer protection. Grants have been made to maintain the provision of help to consumers.
Among the Acts passed in relation to Scotland were measures concerned with the modernisation of the law of marriage and with the enforcement of planning procedures.
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS
I pray that the blessings of Almighty God may attend you. CABINET
PAY POLICY
Memorandum by the Chancellor of the Exchequer
1. Our pay policy has reached a critical stage at which we need to take stock and consider what lines of action we should follow over the next few weeks.
PROGRESS SO FAR
2. From the starting point in July of widespread scepticism about our policy, general expectations of 20 per cent or more as the outcome, and threatened or actual claims of inordinate increases, we have made sufficient progress to avoid the risk of an immediate and dramatic wage explosion. This is on the credit side, and it is backed by:
- increasing public acceptance that the Government is pursuing its policy with determination (threat of using discretionary powers and their actual use in the Mackie case, and resistance to the Air Traffic Control Assistants' claim in the face of industrial action, are two particular features which have had considerable impact);
- as far as actual settlements are concerned, approximately nine out of ten are believed to have been broadly "within the guidelines", although that phrase is interpreted as referring to the 10 per cent earnings target published in Cmnd 6882 and not to the desirability of reaching settlements well into single figures;
- there have been no significant settlements so far which have clearly breached the guidelines.
3. But there is a debit side also:
- no really important settlements have yet been made at all, and the total of settlements so far is much smaller than at the same time in previous pay rounds; ten per cent has come to be regarded as a minimum level, without paying too much attention to elements of drift which are not obviously identifiable;
- some trade unionists seem to be working to establish 15 per cent as a "socially responsible" alternative to the Government 10 per cent;
- no leeway has been created for settlement of any anomalies or special cases where there might be some justification for settlements considerably above any average.
PROSPECTS
4. The tone of the present round is already beginning to be set. The best interpretation one can put on it is that a substantial number of settlements might be achieved at 10 per cent or very little above, not allowing fully for drift, with some settlements a few percentage points above that level and almost none below. This would indicate at best an outcome for the national average over the year as a whole in the 12-14 per cent range.
5. Even this, however, would depend on containing actual settlements or their repercussions, in a variety of important cases and types of cases coming up over the next few weeks. The main ones are probably the following:
i. Ford: it is not yet clear whether the offer of just under 12 per cent will stick, or what effect industrial action or the threat of it will have. What is clear is that there will be a widespread tendency to interpret a settlement on the basis of the present offer as being 12 per cent plus, and that many other important negotiations will take that as the standard.
ii. Local Authority Manuals: the employers are reckoning to settle "between 9.99 per cent and 10 per cent" on earnings. They are conscious that this will make it difficult to settle within the same limit for the Fire Service, and they would like to settle higher for the police. It would in their view be difficult to justify for any other local authority group less than the manuals get.
iii. Police: the Police Federation is intensifying its campaign for an excessive pay increase for the police. The Conservative Party has made such an increase part of its policy. In the course of discussions about a Round Two settlement the Trades Union Congress (TUC) was sounded unofficially about giving the police special treatment and advised strongly against, indicating that anything conceded to the police would be demanded by others. This is bound to be true too in the present situation, where any offer in excess of the 10 per cent guideline will be taken as a green light not only by other public sector groups such as the firemen but also by heavyweight industrial unions who are already seeking to break the guideline.
iv. **Miners**: the proposed productivity scheme is due to go to ballot on 26/27 October after a very small majority on the National Executive. The result is expected on 1 November (subject to any delay due to legal action now under consideration by the defeated members of the Executive). It remains to be seen whether it will be approved; and even if it is, whether it will take the steam out of the pay claim for £135 a week as we have been promised.
v. **Vauxhall**: it is reported that they are proposing a reopener clause triggered by any increase in prices exceeding 8 per cent - a figure which comes dangerously near to guaranteeing a reopening.
vi. **Road Haulage**: there is no sign of a reduction in the level of the proposed settlement which seems to involve at least 15 per cent earnings increase.
vii. **Heating and Ventilation**: in the construction industry, in spite of its poor level of activity, the proposed 20 per cent settlement could set a totally unacceptable standard.
viii. **Productivity Deals**: as was always to be feared, there are indications that such deals are being devised wherever there is any colourable excuse for them without questioning if they are self-financing.
ix. **Special Cases**: the current mood of negotiation gives no hope that special cases and anomalies can be dealt with by increases above other settlements without creating resentment.
x. **Low Pay**: in wages councils and elsewhere it is argued that special help should be given to the low-paid, which implies another addition to the average, even if repercussions can be avoided. (A note at Annex A gives the case for and against setting a floor on wage increases for the very low paid.)
6. If any significant number of these problems is left to develop on the lines currently indicated, the pattern of settlements is all too likely to creep gradually higher, and we shall end the year with national earnings increasing by something approaching, or even exceeding, 15 per cent.
**OUTLOOK FOR FUTURE INFLATION**
7. Developments over the next few weeks are likely to determine the position we shall reach early next summer. The alternatives can be starkly illustrated. Assuming no major change in other factors which influence inflation, we can be confident that the year-on-year rate of inflation measured by the Retail Price Index will fall below 10 per cent around the late spring of 1978, almost irrespective of the immediate prospects on the pay front. But we then have two possibilities:
a. If we are succeeding in running a relatively tight overall pay policy, with prospects for the national earnings average rising over the year by not much more than 10 per cent, the climate of expectation - and the reality - will be that the rate of price inflation is likely to continue downwards. This will obviously provide us with the best possible basis on which to carry forward the attack on inflation subsequently and to encourage higher growth in the economy.
b. If, however, the earnings increase is towards 15 per cent (and of course particularly if, as would be only too likely in the circumstances postulated, financial confidence weakened, our international competitiveness was being undermined, and the exchange rate was going down) we could expect a renewed increase in the rate of inflation.
RENEWING THE ATTACK ON INFLATION
8. We need to consider what we can do ourselves as Government, and whether we can now resume discussions with the TUC and probably also with the Confederation of British Industry (CBI) for help in securing our objective.
9. As regards our own action, we must show continued determination on each and every case which comes before us, with particular regard to those which threaten repercussions. We need to make sure that our internal procedures secure that significant public sector cases continue to be cleared interdepartmentally and if necessary considered by Ministers before offers are made. More generally, as I have suggested to the Sub-Committee on Pay Negotiations of the Ministerial Committee on Economic Strategy, we should try to tighten the current application of policy, building on the degree of relative moderation achieved so far and the falling rate of price inflation. For example, we should:
i. re-emphasise the difference between settlements and earnings and reiterate publicly and frequently the need for individual pay settlements to be well within single figures;
ii. in assessing individual settlements, take a more critical view of the possibilities of wage drift and seek maximum allowance for it;
iii. where there is the chance of securing a below-average settlement, in both private and public sectors, this should be encouraged. 10. I would now add three further points for consideration:
i. we should continue to use discretionary power to withhold financial benefits, and even possibly some other benefits, in cases arising during the next few weeks; in suggesting this, I am fully conscious of the difficulties of long-term use of a policy of this kind, and the need for extreme care in handling individual cases (a note at Annex B summarises the conclusions on this of the Sub-Committee on Pay Negotiations);
ii. we should avoid making any concessions or accepting any special cases during the next few critical weeks;
iii. we should take particular care to demonstrate firmness in relation to all public sector settlements - there are comparatively few in the coming weeks but our action on them will be taken as exemplary.
11. I think it is also for consideration whether the time has come to renew discussions with the TUC. If we do so, we should certainly also talk with the CBI, although I regard that in present circumstances as being both less difficult and less important.
12. There can be no doubt that we have a basis for a new approach to the TUC. We can put the following points to them:
a. The declining rate of inflation has been clearly established: all commentators agree that we are on the road to single-figure inflation.
b. We have decided and are about to announce a package of measures, to be implemented immediately, which will have considerable appeal to the TUC. We are able to show that restraint in wage demands is not only compatible with, but positively helps, an improvement in the standard of living - if wage settlements creep up and bring rising inflation in the second half of 1978, then we will have little chance of bringing unemployment down and of winning the next Election.
CONCLUSION
13. I invite my colleagues:
i. To endorse the need for further effort to improve the prospects of success in the current pay round. ii. To consider the possible lines of action indicated in this paper and suggest others which may occur to them.
D W H
Treasury Chambers
20 October 1977 THE APPLICATION OF PAY POLICY TO LOW PAID GROUPS
The Incidence of Low Pay
Some 1.8 million full time adult employees are currently earning less than £40 per week, about 1.5 million of them women. It is not certain how many of the 300,000 men are heads of households; estimates suggest that the number of such workers with families of two children may be up to about 50,000; among the women, also, some will be the main breadwinner in a family group. It is also estimated that there are some 100,000 families where the head is in employment and which are eligible for means tested EIS. The Supplementary Commission have recently pointed out, in their evidence on low incomes to the Royal Commission on the Distribution of Income and Wealth, that low levels of pay are now constraining the scales of benefits which they would otherwise think appropriate for those who are not in work.
Special Provision for the Low Paid
2. Pay policies have generally made special provision for the low paid. It can be argued that some progress has been made thereby, in that the lowest decile of the earnings distribution, now about £50 per week, is some 68 per cent of the median, when in 1970 it was only 65 per cent. But such progress is at best slow and the need to make further improvements points to a case for making special provision in the current pay round as much as in 1975 and 1976. It is true that the TUC did not pass a NUPE motion for a £50 minimum wage, but this was against a background of a return to free collective bargaining in which negotiators could press a special case for the low paid.
3. In the context of the present pay guidelines, the case for special provision rests mainly on the difficulty of defending a restriction to 10 per cent of the earnings of those who are paid £40 or less for a normal week. This is particularly true for Wages Council rates, the majority of which are around £30, and some well below. Some independent members of important councils are known to feel strongly about this and might move towards recommendations and statutory orders which Government would have no powers to alter. This could lead to a serious confrontation over pay policy.
4. Proposals for dealing with low pay are to allow freedom for collective bargaining below £40 without any constraint from pay policy; or a modification of the present 10 per cent limit to a limit of £4 or 10 per cent whichever is the higher.
The Case Against
5. These proposals are however open to doubt in two important respects. First, there is evidence that special increases at the lower end of the pay range do not affect more than a small proportion of those who need help because of family poverty; there is also evidence, contrary to that adduced above, that special provision for minimum pay increases does not in fact improve the earnings distribution in favour of the lower paid.
6. On the first point, it has been established that only a very small proportion of the low paid belong to poor households. The figures in Paragraph 1 above show the relatively small number of families in real need who would be affected by special provisions covering nearly 2 million workers. Moreover, the evidence also suggests that even such benefits as might accrue in the short run are not in fact maintained. While the statistics in paragraph 2 above suggest some slight improvement for the lowest decile in the earning range, similar statistics for the lowest one per cent of the earnings distribution show that there has been no improvement at all over the years. The lowest percentile of the earnings distribution now bears the same relation to the median as it did in 1970, and this suggests that such attempts as there have been to help the low paid have worked right through the earnings distribution, raising the general level of earnings but meanwhile leaving an impression of an attempt by Government to compress differentials. It was one of the aims of the guidelines put forward in Cmnd 6882 to provide for earnings increases in percentage terms, without any suggestion of compression at either end of the scale and special provision now intended to provide a minimum pay increase for the low paid would run counter to this principle. THE USE OF DISCRETIONARY POWERS IN SUPPORT OF THE PAY POLICY
At its discussion on Friday 14 October (EY(P)(77) 16th Meeting, item 1) the Sub-Committee on Pay Negotiations had before them reports by the Official Committee on Prices and Incomes (attached to EY(P)(77)62) and by the Attorney General (EY(P)(77)65).
The Sub-Committee noted the political and legal difficulties and dangers inherent in the present unsatisfactory position, resulting from the use of measures which were not purpose-built to support the pay policy and from the lack of a precisely defined pay limit. There was general agreement that the Government could not rely on the use of discretionary powers as the sole or main instrument of pay policy and that they were not an effective substitute for the support of the TUC and CBI. They were weaker than the sanctions available in Rounds 1 and 2 and the price sanction was almost non-operative. While it was true that in some instances as in the Mackies case the Government could argue that the pay policy was entirely consistent with the original purposes of the instrument being used, no general system of legal sanctions could operate in the absence of a rigid pay formula and in these conditions the only available course was to handle each case carefully on its merits.
It was therefore agreed that:
(i) while the Government could not rely on discretionary powers as the sole or main instrument to enforce the pay policy it could not afford to abandon their use at this stage; ii) departments should be given fresh guidance on the policy to be adopted in threatening and using discretionary powers over the coming months. In particular they should avoid making threats which could not be substantiated; seek legal advice in all cases of doubt; and take great care in how they were applied making sure they had legal clearance.
The Sub-Committee noted that the problems raised by the use of discretionary powers and possible options open in the longer-term would be covered in the Chancellor of the Exchequer's submission to Cabinet on the future of pay policy. CABINET
NINTH REPORT OF THE SELECT COMMITTEE ON EXPENDITURE 1976-77: DRAFT GOVERNMENT RESPONSE
Note by the Chief Secretary, Treasury
1. The Ninth Report of the Expenditure Committee, 1976-77, was published in July and comprised an introduction by the main Committee and chapters prepared separately by the specialist sub-committees. The subjects covered by the chapters were: Defence and Overseas Services; Export Credit Finance; Housing; Employment of Civilians for Police Purposes; Health and Personal Social Services; and HM Stationery Office. The chapters varied considerably in content: some dealt with policy; some with presentation in the public expenditure White Paper; and some contained both kinds of recommendations.
2. The attached response has been prepared by the Treasury and other Departments concerned; and has been agreed at official level. Since it is made on behalf of several Departments, it is proposed to publish it as a White Paper. I am therefore circulating it for the Cabinet's information: subject to any comments I receive by 26 October, I will arrange for the response to be published as a White Paper as soon as possible.
J B
Treasury Chambers
20 October 1977 INTRODUCTION
1. In their Ninth Report of the 1976-77 Session, the Expenditure Committee considered a number of programme chapters in Part 2 of the White Paper setting out the Government's expenditure plans (Cmd 621). The Government welcome the contribution which has been made by the Committee in directing public attention in this way to the objectives of selected expenditure programmes.
2. The Government have given careful consideration to the observations made by the various sub-committees. This White Paper gives the Government's reply to the various recommendations. The Committee pointed out in paragraph 4 of the report that a number of these recommendations concerned the provision of additional information, and suggested that it might often be preferable for such information to be provided in separate departmental papers rather than in the public expenditure White Paper itself. This general observation has been taken into account in the Government's response to the recommendations concerned.
CHAPTER I: DEFENCE AND OVERSEAS SERVICES
Defence
Recommendation
Treasury and Ministry of Defence to consider carefully inclusion in the Public Expenditure White Paper, and possibly also in the Statement on Defence Estimates, a table setting out details of all changes in the Defence Budget for 1975-76 and subsequent years caused by public expenditure reviews or policy decisions (paragraph 1.4).
3. The Ministry of Defence will be ready to respond, by way of written evidence, to any future requests from the Committee for tabular information of this nature. Inclusion of such information in the public expenditure White Paper would unbalance a document intended to explain changes in the Government's expenditure plans during the previous year and not to give a full historical record of all changes during a longer period. With the passage of time a financial presentation starting from 1973 would become increasingly inappropriate. Recommendation
Notification of cases in which compliance with the cash limit on defence spending has been possible solely or largely as a result of slippage or offsetting savings (paragraph 1.5).
4. The Committee will be informed of instances where slippage has played an identifiable significant part in assisting the Ministry to keep within its cash limit or where this has been achieved only by deliberate reductions in the programme. It is often difficult in practice to draw a clear distinction between unexpected slippage and the additional delays occasioned by the pressure of the cash limit.
Overseas aid and other overseas services
Recommendations
Changes since the previous White Paper to be broken down by sub-programme (paragraph 1.7);
Significant changes to be explained in the Part 2 text (paragraph 1.8);
Inclusion of a table in every Public Expenditure White Paper showing the cumulative effect of changes in each programme for each year (from 1973-74 onwards) since the original estimate was drawn up (paragraph 1.8).
5. The Government agree that explanations of significant changes in this programme since the previous White Paper should be included in the text following the table at the head of the programme chapter (table 2.2 in Cmnd 6/21). Inclusion of all the tabular information requested could tend to make the White Papers unmanageably large. This information may best be given annually in the form of regular written evidence to the Committee.
CHAPTER II: EXPORT CREDIT FINANCE
Recommendation
The costs of the interest support scheme should appear in the Trade, Industry and Employment table of the Public Expenditure White Paper (paragraph 2.47).
6. The Government accept the recommendation that interest support costs for fixed-rate export credit should appear separately in the international trade section of the trade, industry and employment table of the White Paper. The corresponding entry in respect of the interest support costs for the home ship-building credit will be made in the general support for industry section of the same table. It is hoped to include the figures in the next White Paper.
7. Paragraph 2.19 of the report states that the Department of Industry do not take part in discussions about the possible mutual effects of trade policy and export credits. The Department of Industry do in fact participate in discussions on the factors to be assessed in the granting of export credit.
CHAPTER III - HOUSING
Recommendations
Figures of public expenditure on housing should be shown in greater detail (paragraphs 3.6, 3.7 and 3.8).
08. The Government accept in principle the recommendations that more detailed analyses should be made available of the figures in the housing table (table 2.7 in Cmd 6/21); that the distinction between capital and current expenditure should be clear; and that expenditure on goods and services should be distinguished from that on transfer payments.
09. The layout proposed by the Committee in paragraph 3.9 will therefore be adopted in general for the housing table in the next public expenditure White Paper. However, local authorities will have greater freedom to determine priorities within the new housing investment programme system and the Government propose to issue block allocations which will cover programmes separately identified at present. Further, even after block allocations for capital expenditure have been made for a particular year, authorities will have the ability within defined limits to increase expenditure of one kind if they reduce expenditure of another. Any detailed government projections for the survey period would therefore be no more than indicative (except in the aggregate) and, particularly for the later years, less detailed expenditure analyses might accordingly be more helpful. Further consideration will have to be given to this point as the new system of capital allocations is developed.
10. To help local authorities to make fuller use of the White Paper, it is necessary to show how the figures in the housing table can be reconciled with those with which they are familiar in the rate support grant settlement and elsewhere. Such a reconciliation was circulated to local authorities in England and Wales in April (DOE circular 37/77) and recent evidence suggests that this is now meeting the need to which the Committee has drawn attention. Subject to further consultation with the local authority associations, the Government propose to issue a similar reconciliation each year in explanation of the public expenditure White Paper figures. In Scotland, information is provided to local authorities through the Convention of Scottish Local Authorities. In view of the bulk of the material involved it seems better to provide it in these ways than in the White Paper itself. Recommendation
Additional supporting information should be provided in the Public Expenditure White Paper and in an annual Housing White Paper (paragraphs 3.11, 3.16 and 3.18).
11. The Government accept that mortgage interest relief is relevant to consideration of housing policy and will include in future White Papers estimates of the cost of such relief for past years and the year of publication. The results of a study in 1974, to estimate the effect on supplementary benefit expenditure if housing costs were excluded from the calculation of requirements, will be included in the next White Paper. Information will also be provided of the amount of loans outstanding under guarantee by the Housing Corporation. The Government will continue to provide a substantial amount of non-financial information about past performance and will keep under review the possibility of increasing the amount of such information.
12. More generally, the Government share the Committee's view that there is a need for information on housing to be collected together and presented systematically in addition to the regular publication of data as in housing and construction statistics. They accept that the housing chapter of the public expenditure White Paper should include information relating directly to table 2.7 and will consider what further information could usefully be provided. They do not consider, however, that an annual housing White Paper tied to the public expenditure White Paper would be the most effective way of presenting a wider range of material. The Green Paper on Housing Policy (Cmnd 6851) foreshadows the establishment within Department of the Environment of a special unit to analyse information about housing and to monitor progress. It will be one of the functions of that unit to produce from time to time analyses over the whole housing field bringing information together and updating material given in the Green Paper and Technical Volume. This will help to maintain the wide range of background information now available, against which public expenditure decisions and government statements of housing policies can be considered. The comparable arrangements in Scotland and Wales will have to be considered further in the light of the proposals for devolution. CHAPTER IV: EMPLOYMENT OF CIVILIANS FOR POLICE PURPOSES
Recommendation
The study on "civilianisation" should be completed as quickly as possible, and its results be reported to the House (paragraphs 4.17 and 4.25).
13. This recommendation is accepted. The area covered by this chapter of the report has involved, and will involve, difficult decisions on the best use of resources for the police service. The restrictions on goods and services and on civilian staff were suggested to police authorities as being the least harmful means of keeping within the limits of expenditure laid down by the Government and explained in Cmnd 6721. The economies in the police service were not designed to secure a reduction in total police expenditure but rather to help accommodate the higher cost of particular items such as police pensions (which mainly reflects an increase in the number of police who have retired); total expenditure on the police service is still planned to rise in real terms.
14. The Government remain of the view that, within the police service, priority should be given to bringing the strengths of police officers up to authorised establishments, even if a small proportion of the additional officers has to be used on tasks normally the responsibility of civilian staff; if the number of police officers exceeds the estimated growth, provision will be made for additional expenditure within authorised establishments. Any growth in expenditure on other parts of the police service has to be limited by the country's general economic position and at present must be kept within the programme in Cmnd 6721. The local authority associations, with the advice of their financial and professional advisers, accepted the priority for the recruitment of police officers and reluctantly agreed that restrictions on civil staff and cadets would have a less damaging effect on operational policing and force efficiency.
15. Until the current rate support grant negotiations have been completed it is not possible to say what the position will be in the coming financial year. The views of the Committee in paragraphs 4.16 and 4.17 will be taken into account in making any reassessment necessary, as well as any views which may emerge from the study of civilianisation, arrangements for which are now going forward.
Recommendation
A full review should be made of cadet recruitment both from a qualitative and quantitative point of view (paragraphs 4.23 and 4.26). 16. This recommendation is being implemented. The general principles set out in paragraphs 13-15 above apply with equal force to police cadets, who do not make any appreciable contribution to immediate operational efficiency. Although the unit cost of a cadet is £1,607 per annum, this figure does not include the cost of training; the overall cost of passing a 16 year old cadet through to attestation as a police officer at 18½ is of the order of £6,000-£7,000.
17. Consideration was already being given to an enquiry into the need for cadets before the Committee began its work. The Home Secretary proposes to set up a working party of the Police Advisory Board for England and Wales to consider the matter with the following terms of reference:
"To consider the place of a cadet system in contributing towards obtaining sufficient recruits of the right quality to enable force strengths to reach authorised establishments".
It is hoped that it will report in time for any changes to be reflected in the September 1978 intake of cadets.
CHAPTER V: SPENDING ON THE HEALTH AND PERSONAL SOCIAL SERVICES
Social Security
Recommendation
The Department of Health and Social Security to improve its forecasting of the benefit implications of the levels and patterns of unemployment (paragraph 5.8).
18. Every effort is being made to improve the forecasts of expenditure on benefit. Considerable research has been undertaken, as a result of which revised and more complex estimating techniques have been developed. Past experience is not always a reliable guide and this makes forecasting difficult. The cost of benefit at any unemployment level depends, inter alia, on the number of the unemployed who are women, how many of them are married, and how many of the total men and women on the register have exhausted their entitlement to unemployment benefit or are not entitled to benefit because they fail to satisfy the contribution conditions or for some other reason. Where unemployment benefit is not payable or is insufficient to meet a person's or his family's need, supplementary benefit may be payable. And all of these factors are variable because of the large turnover of people registered as unemployed, even when the level of unemployment is high. Recommendations
In future the assumptions made when making an explicit provision for uprating improvements should be clearly set out in the White Paper. There is no reason why the social security programme should have its own private contingency reserve (paragraphs 5.11 and 5.13).
19. The Government have noted the Committee's views on the presentation of the social security programme, and this will be kept under review.
20. For the reasons previously given to the Committee, the Government see considerable disadvantages in publishing the economic assumptions underlying the expenditure projections. Future expenditure on the individual benefits was expressed in the White Paper in terms of the average levels of benefit during 1966-77, which amounts to assuming increases from year to year at the same rate as prices. In practice, total expenditure on the social security programme is determined by a number of factors which cannot be provided for with certainty in advance. The commitment to increase pensions and other long-term benefits in line with the increase in earnings, where this exceeds that in prices, implies a trend of improvement in these benefits in real terms; and the real cost of benefits in the event will also be affected by the actual movement of prices. In addition, the demand for benefits will be substantially affected by demographic and economic factors.
21. In place of the broad allowance described as providing simply for uprating improvements in previous White Papers, it was, therefore, decided to make a general provision for variability in the factors likely to affect the cost of the social security programme. This provision could have been added to the contingency reserve and not shown separately in the social security programme. But since it represented the Government's judgement of the most appropriate provision for the cost of the social security programme taken as a whole, its inclusion within the contingency reserve would have been less informative, and impeded the function of the contingency reserve as an instrument of operational control. Health and personal social services
General comment
22. The Committee lay emphasis in their Report on the need for more detailed analysis of the costs and benefits of the health and personal social services, for more specific criteria for measuring progress towards objectives and for indicators of performance of different kinds. The Government wish to improve and develop such measures, which provide the basis for the proper distribution of resources and planning of services. This work is subject to two constraints: there is great difficulty in defining and measuring the final output of health services, and a limit to the capacity of the Department to undertake the analysis and refinement of data. Of necessity, therefore, measures of an intermediate kind - levels of provision of facilities, throughput, etc - often have to be used and the Department must concentrate its efforts on what will serve practical purposes most directly and immediately. But the Government acknowledge the need for the longer-term to improve analysis and to develop new indicators, and within the resources available will continue both their own work and support for research by others.
Recommendation
The Department should make sure that it is in a position to monitor unplanned cuts that may result from the operation of the cash limits system and to check that they are implemented in the least damaging way (paragraph 5.15).
23. The Department guides and controls the health authorities primarily through the planning system. The authorities are responsible for implementing their plans within the resources provided. The Department looks to the authorities themselves to secure any economies that may be necessary to comply with cash limits in whatever way they judge least damaging to the planned pattern of their services. The effect of the authorities' decisions can be monitored by the Department in the subsequent planning round when any measures necessary to deal with imbalances in the provision of services can be considered. If the operation of the cash limits system appeared likely to have serious and immediate effects on standards of patient care during the current year, the Department would expect to be consulted by the authorities concerned about the action required.
Recommendation
Details of the income from personal social services charges should be included in the White Paper (paragraph 5.17).
24. This recommendation is accepted. Opportunity and information should be given for more discussion in the House of Commons and elsewhere of the policy options when imposition of NHS and personal social services charges is being considered (paragraph 5.19).
Opportunity for discussion and for the provision of information about the imposition of NHS charges is presented when the necessary statutory instruments under the NHS (Consolidation) Act, 1977 are laid before Parliament. Charges for personal social services are essentially a matter for individual local authorities. As indicated in the Green Paper on Local Government Finance (Cmnd 6813), the Government have accepted the Layfield Committee's recommendation for a joint review of central and local government policies towards charging for local services. This review will cover the personal social services and the Department of Health and Social Security will take part in it.
The priorities between current and capital spending should be reviewed without delay to ascertain whether an imbalance which ought to be corrected has been created (paragraph 5.24).
The balance between current and capital spending is one of the issues to be considered in a review of the use of health capital and of the revenue consequences of capital investment now being undertaken.
The Department should set in train studies to examine the relationship between management costs suitably defined and patient care (paragraph 5.26).
The Government believe that efforts to secure the most cost-effective use of management skills must be based on careful and objective appraisal by individual health authorities, who will have to take account of many local factors in deciding where management costs can be reduced without damage to patient services. The outcome of these reviews will be monitored both in the annual planning cycle and by the Department against the national target of a 5 per cent reduction to be achieved by the end of 1979-80. This continuing and close examination of management costs will take account of the need to keep in reasonable balance the costs of services for patients and of management. Further studies would be unlikely to establish any clear-cut and generally valid relationship between management costs and such indicators as level of provision, throughput, waiting lists and unit costs, especially as a variety of local factors would have to be taken into account. Recommendation
The Committee should receive regularly figures from DHSS which distinguish between increases in unit costs that reflect lower manpower productivity and increases that reflect improved resource provision for patients (paragraph 5.31).
28. The Committee will be provided with regular figures derived from the Department's monitoring of unit costs. Where there has been improvement in the conditions of service of staff it is not easy to determine to what extent increased costs should be ascribed to this, rather than to improved patient care. For example, if junior doctors were to work fewer hours this might benefit doctors (by increased leisure) and also patients (by having less tired doctors attending them). The Department is studying historic data with a view to improving the method for analysing the causes of increases in unit costs, and will keep the Committee informed of the results.
Recommendation
The expenditure planning and priority-setting of DHSS should be synchronised so as to enable Parliament to examine the relationship between the two (paragraph 5.32).
29. The Department's annual reassessment of priorities is in fact linked with the expenditure forecasts in the White Paper. In future years the aim will be to issue planning guidelines annually to health authorities in March, indicating resource assumptions for the forthcoming public expenditure period and to provide regularly for a forward year within the survey period an illustrative projection of the average level of provision and current expenditure on various services that is consistent with priorities and with planned public expenditure. Local authorities will receive similar guidance as respects the personal social services. It is hoped that this timing will facilitate examination by Parliament.
Recommendation
The Department should publish its analysis of the regional responses to the 1976 Consultative Document, and an explicit statement of the criteria used in deciding whether or not local divergencies from national priorities are justified (paragraph 5.33). 30. Revised policy guidance published by the Department in September 1977 included a summary of comments on the Consultative Document (including those by regional health authorities) and also a brief analysis of the main points emerging from the strategic plans submitted by the regional health authorities this year. A judgement as to whether local divergencies from national priorities are justified can only be made after discussion between the Department and the particular region, and it is not possible to lay down rigid criteria for this. A fuller analysis of the regional plans will be published early in 1978, following discussions with individual regional health authorities.
Recommendations
1. Clearly set out the cost of policies so as to allow Parliament to identify costs which arise from new commitments as distinct from those arising from on-going commitments;
2. Specify criteria for measuring the progress towards achieving the policy objectives implicit in new commitments;
3. Provide a more detailed analysis of who benefits in what ways from public expenditure.
(Paragraph 5.35)
31. The commentary in Cmd 6721 (Part 2) on the health and personal social services programme gave some indication of how far expenditure plans catered for new as distinct from on-going commitments. The Department will continue to provide this information and consider how it might be improved. Most of the developments in the health and personal social services programme do not take the form of specific new commitments, but are developments of existing services. For these, the annual planning guidelines and the programme budget issued regularly by the Department give a better indication of the projected development of services than can be provided in the public expenditure White Paper. They will also give a measure of progress towards policy objectives, and an indication of the projected distribution of resources between different groups as a result of these developments. Copies will be placed in the Library of the House. Further information on the distribution of resources and on benefits in terms of services and facilities will be available from the analysis of regional plans, and from other material published from time to time, such as the annual Volume of Health and Personal Social Services Statistics and the Hospitals In-Patients Enquiry. Recommendations
The Department should begin now to develop, for the longer-term, indicators of performance. The Department should in particular develop -
(a) Measures of access to show how far people in different areas have the same chance of obtaining treatment of care and whether access is improving over time. And
(b) Measures of quality provision to show improvements (or deteriorations) in the physical environment, amenities and patient satisfaction (paragraph 5.36).
32. The Government recognise the importance of measures of the kind suggested. Some indicators are already in use within the Department and in the NHS to monitor the development of services and to establish targets for the distribution of financial resources. Planning the best use of resources available for the health and personal social services will always involve decisions and judgement that cannot be precisely quantified. The levels of provision of specific facilities and the length of time on waiting lists are also used as indicators, monitored regularly and published in DHSS Annual Reports and statistical publications. Indicators of relative need for resources for hospital and community health services have been developed by the Resource Allocation Working Party. Through the NHS planning system the Department will be able to analyse progress towards greater equality of provision between regions, areas and districts and changes in the balance of provision of different types of service for different patient groups. In the personal social services levels of provision are similarly monitored, and attempts are being made to refine the indicators of need and to improve the distribution of the rate support grant.
33. As indicated in paragraph 22 above, there are difficulties and constraints in the further development of indicators. The methodological problems of measuring performance and patient satisfaction are considerable; the work is costly and uses scarce staff resources. But some work is being undertaken within the Department and research elsewhere is being supported. The Department will continue these efforts.
CHAPTER VI - STATIONERY AND PRINTING (HOME)
Recommendation
The introduction in principle of repayment and a trading fund for HMSO (paragraph 6.16). As was stated in evidence the main objective in the period immediately ahead must be the development of the new management accounting systems and trading accounts. These will enable more information to be made available to Parliament and the public. These developments will not prejudice the question of introducing general repayment and a trading fund; indeed they are a pre-requisite of these developments, decisions on which will need to be taken in the light of experience gained in operating the new management accounting procedures. The views of the Committee will be taken fully into account at the time.
Recommendation
Pricing policies should be considered and any price reductions adequately advertised (paragraph 6.19).
35. Pricing policy for government publications is kept under continuous review, and any price reduction will be advertised as the Committee recommends. The Government agree with the Committee that the financial aim (break-even taking one year with another) conflicts with the widest possible readership of publications. The price of the daily parts of Hansard is already below the marginal cost. The number of copies sold to the public is small (currently about 2,000) and has been declining over the last 20 years. A price reduction could stimulate some increase in sales, but would increase the overall cost to the Government. As regards other HMSO publications, if the price to the public could be reduced, additional sales might follow, the revenue from which could suffice to offset the cost of producing the extra copies. But if the price reductions were brought about by making the copies produced for official use bear all the initial publication costs, the overall effect would again be to increase the net cost to government of government publishing.
Recommendation
The annual report should give a detailed account of all Stationery Office activities. The General Sub-Committee should be consulted before decisions are taken about the form of the accompanying accounts (paragraph 6.22). 56. The Government will take account of the Committee's views in reaching final conclusions about the content of the annual report, and in determining the form of accounts.
57. The Committee also suggested that the cash limits fixed for HMSO for 1977-78 appeared to be lax, in that they amounted to £116 million against expenditure in Main Estimates of £90 million. The cash limits covered some expenditure on behalf of the National Insurance Fund which in the Estimates, unlike the cash limits, is offset by receipts from the Fund. The amount provided in the Estimates, comparable with the figure of £116 million in the cash limits, is therefore £100 million and not £90 million. CABINET PAY POLICY
Memorandum by the Secretary of State for Employment
1. The Chancellor of the Exchequer refers in paragraph 5x. and Annex A of his paper (CP(77) 96) to the case for some modification of the general limit on the level of settlements for the low paid.
2. This case was set out more fully in the paper attached to my minute of 30 September to the Prime Minister which was circulated to my Cabinet colleagues. My proposal is that we should not seek to limit any increase to less than £4 for a normal week.
3. This would be more than 10 per cent for the 1.8 million full-time adult employees currently earning less than £40 for a normal week, up to 13 per cent for those earning £30. 29 per cent earn less than this. More details of the distribution are given in the Annex to this paper.
4. If fully taken up, which is unfortunately doubtful, this would of itself add only 0.1 per cent to the national wage and salary bill additionally to the current policy. I do not believe this very modest flexibility for the relatively small numbers of workers at these very low levels would have any significant repercussions. It is of a quite different order from the £2.50 minimum attached to the 5 per cent Stage 2 limit which benefited the much more substantial proportion of the labour force who were then earning less than £50 a week, and by far more than 5 per cent.
5. Moreover in reality we have very little choice in the matter. Over half those concerned are covered by Wages Councils. The independent members of the most important Councils have already indicated to me in the strongest terms that they propose to support workers' representatives' claims exceeding 10 per cent for those on these levels of earnings, which they regard as quite consistent with the Government's national earnings objectives.
6. Unless I am able to dissuade them from their cause, which is I think very unlikely, the Councils will accordingly confirm statutory orders, which I have no power to delay or override, in contravention of the Government's policy. My colleagues have already agreed that in such circumstances there could be no question of applying sanctions to the employers affected.
7. In my judgment the repercussions of such clear breaches would be more damaging than a well-defined concession on the lines proposed in paragraph 2 above.
A B
Department of Employment
21 October 1977
### Estimate Numbers of Employees in PAYE Schemes with Gross Earnings Excluding Overtime Pay of Less Than £1 Per Hour in April 1977
| Age Group | Full-Time | Part-time | Total | |-----------|-----------|-----------|-------| | | Number (000's) | Percentage of all employees | Number (000's) | Percentage of all employees | Number (000's) | Percentage of all employees | | Male | 290 | 3 | 100 | 42 | 380 | 4 | | Female | 740 | 19 | 1020 | 46 | 1760 | 29 | | 18 to 20 | Male | 200 | 34 | 10 | 81 | 210 | 35 | | Female | 280 | 46 | 10 | 57 | 290 | 46 | | Under 18 | Male | 230 | 88 | 10 | 89 | 230 | 88 | | Female | 220 | 87 | 10 | 89 | 230 | 87 |
### Estimated Earnings Distribution of Full Time Employees in PAYE Schemes with Gross Earnings Excluding Overtime of Under £40 Per Week in April 1977
| Earnings Range | Percentage | |----------------|------------| | Under £30 | 29% | | £30-£32 | 11% | | £32-£35 | 19% | | £35-£37 | 16% | | £37-£40 | 25% | | Total | 100% |
### Notes
1. Between April and July 1977 average earnings generally increased by a little over 1%.
2. The estimates do not include: a. people on the margins of the labour market with earnings below PAYE limits. b. those off work and receiving no pay at all for the relevant pay-period. c. others who did not receive full pay for the whole of the pay-period.
Source: DE New Earnings Survey. CABINET
THE QUEEN'S SPEECH ON THE PROROGATION OF PARLIAMENT
Note by the Secretary of the Cabinet
I circulated under cover of CP(77) 95 for the information of the Cabinet a copy of The Queen's Speech on the Prorogation of Parliament in the form in which it had been submitted to the Counsellors of State. The Speech has subsequently been revised to take account of The Queen's wish to have the opening paragraph transferred from the Prorogation Speech to the Opening Speech and has accordingly been resubmitted to the Counsellors of State.
Signed JOHN HUNT
Cabinet Office 25 October 1977 CABINET
THE QUEEN'S SPEECH ON THE OPENING OF PARLIAMENT
Note by the Secretary of the Cabinet
I attach for the information of the Cabinet a copy of The Queen's Speech on the Opening of Parliament in the form in which it has been approved by the Counsellors of State on behalf of The Queen.
Signed JOHN HUNT
Cabinet Office 31 October 1977 DRAFT OPENING SPEECH
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS,
My husband and I look back with delight and gratitude on the events which marked My Silver Jubilee at home and overseas, and the visits which we made to many parts of the United Kingdom and the Commonwealth. I look forward to paying a State Visit to the Federal Republic of Germany next May and to opening the Commonwealth Games in Edmonton in August.
In pursuit of peace and collective security, the United Kingdom remains committed to the aims of detente, disarmament and the prevention of the spread of nuclear weapons. My Government reaffirm their policies in international relations and defence, and will contribute fully to the work of the United Nations, the Commonwealth and the North Atlantic Alliance.
While working for policies which fully reflect the interests of the United Kingdom, My Government will play a full and co-operative part in the activities, the development and the enlargement of the European Economic Community.
They will continue to contribute modern and effective forces to the North Atlantic Treaty Organisation, and to play their full part in the current Alliance studies of East/West relations and of the Alliance's defence programmes. They are participating constructively in the important meeting in Belgrade which is being held as part of the follow-up to the Final Act of the Conference on Security and Co-operation in Europe; they will abide by the provisions of the Final Act, and continue to seek fulfilment of all its provisions by other signatories. They remain committed to the pursuit of detente in their relations with the Soviet Union and the countries of Eastern Europe.
My Government will continue to take part in international efforts to combat recession and promote a more stable world economic order, and a fairer distribution, within an expanding world economy, of the world's wealth between rich and poor nations; they will maintain their special efforts to help the poorest countries and the poorest people. They will work for a just and lasting peace in the Middle East, and the further improvement of relations between the United Kingdom and all the countries in the area. They will continue to co-operate with all concerned in the search for a lasting settlement in Cyprus, where they welcome the resumption of intercommunal talks.
Efforts will be maintained to achieve a negotiated settlement in Rhodesia, on the basis of my Government's proposals published in September this year, which are designed to provide a secure future for people of all races. My Government will be ready during the current session to introduce legislation to enable Rhodesia to proceed to independence on this basis.
MEMBERS OF THE HOUSE OF COMMONS,
Estimates for the public service will be laid before you.
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS,
The strengthening of the country's financial position and balance of payments opens the prospect for a continuing improvement in the economy and the maintenance of financial stability. My Government's main objectives are the speediest possible return to full employment and a sustained growth of output. In order to achieve those objectives they will give the highest priority to further reductions in the rate of inflation.
My Government will continue to take action to reduce high unemployment through manpower measures and to promote industrial training.
They will ensure that the benefits of North Sea oil are used to achieve a lasting improvement in our industrial performance and therefore to provide more jobs, higher real incomes and improved public services.
My Ministers will continue to work in close co-operation with the Trades Union Congress and the Confederation of British Industry.
Internationally My Government will continue to urge that the stronger economies should take the lead in promoting a sustained growth in the world and that adequate official finance should be made available on appropriate terms to countries with continuing deficits in the balance of payments. My Government remain firmly committed to establishing directly elected assemblies for Scotland and Wales. Separate Bills will be introduced for this purpose.
In Northern Ireland My Government will maintain their aims of establishing a devolved Government acceptable to both parts of the community; and eradicating terrorism by the prosecution through the courts of those responsible for violence and by continuing to develop the effectiveness of the Royal Ulster Constabulary, supported by My Armed Forces. My Government attach special importance to co-operation on matters of security with the Government of the Republic of Ireland. They will continue to seek measures to strengthen the economy of Northern Ireland and improve its social environment.
Legislation providing for the election of United Kingdom members of the European Assembly will be re-introduced.
Further consultations will be held on industrial democracy, with a view to producing proposals which should command general support, and My Ministers will continue directly to encourage the development of industrial democracy in the nationalised industries.
There will be a review of the legislation and institutions governing competition policy, to see that this makes its maximum contribution to improving industrial efficiency.
My Ministers are considering further measures to assist small firms.
They will also hold consultations about encouraging profit-sharing through the tax system.
Legislation will be brought forward to amend company law.
A Bill will be introduced to provide public funds to finance payments to redundant shipbuilding workers in the public sector. Legislation will be introduced providing for changes in the structure of the electricity industry and other matters affecting the industry.
Continued encouragement will be given to the efficient production, processing and distribution of food with the aim of meeting a greater proportion of our national needs from United Kingdom agriculture. My Ministers will seek improvements in the operation of the Common Agricultural Policy.
My Government will continue to seek major reform of the Common Fisheries Policy. They will aim to secure conditions which will meet the needs of the British fishing industry, conserve fishing stocks, and ensure adequate supplies to the consumer.
A Bill will be laid before you to increase the borrowing powers of the Civil Aviation Authority and British Airways, to provide for a levy to finance aviation security and to amend the civil aviation Acts.
Legislation will be introduced for the further development of transport policy to meet economic and social needs, including those of rural areas.
Legislation will be brought before you to provide assistance for first-time home buyers.
A Bill will be introduced to renew and revive the inner urban areas.
Legislation will be introduced on the composition and certain functions of the General Medical Council.
In addition to My Government's full programme of constitutional and other reforms for the present session, they remain committed to bringing forward at the earliest opportunity a number of further highly desirable measures of reform. These measures include improvements in safety and discipline at sea and other aspects of merchant shipping, and the right of Post Office staff to take industrial action.
Legislative proposals will be brought forward for the reform of section 2 of the Official Secrets Act 1911. Following the Report of the Committee on the Future of Broadcasting, My Government will bring forward proposals on the constitution, structure and organisation of broadcasting in the United Kingdom.
An increase in the limit on public funds for the National Film Finance Corporation will be proposed before the present limit expires.
Measures will be brought before you to reform public sector housing subsidies in Scotland; to improve criminal procedure and reform the criminal justice system in Scotland; and to extend the powers of Scottish local authorities in relation to their direct labour organisations.
Further progress will be made with My Government's programme of law reform.
Other measures will be laid before you.
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS,
I pray that the blessing of Almighty God may rest upon your counsels.
31 October 1977 THE QUEEN'S SPEECH ON THE OPENING OF PARLIAMENT
THURSDAY, 3RD NOVEMBER, 1977
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS,
My husband and I look back with delight and gratitude on the events which marked My Silver Jubilee at home and overseas, and the visits which we made to many parts of the United Kingdom and the Commonwealth. I look forward to paying a State Visit to the Federal Republic of Germany next May and to opening the Commonwealth Games in Edmonton in August.
In pursuit of peace and collective security, the United Kingdom remains committed to the aims of détente, disarmament and the prevention of the spread of nuclear weapons. My Government reaffirm their policies in international relations and defence, and will contribute fully to the work of the United Nations, the Commonwealth and the North Atlantic Alliance.
While working for policies which fully reflect the interests of the United Kingdom, My Government will play a full and co-operative part in the activities, the development and the enlargement of the European Economic Community.
They will continue to contribute modern and effective forces to the North Atlantic Treaty Organisation, and to play their full part in the current Alliance studies of East/West relations and of the Alliance's defence programmes. They are participating constructively in the important meeting in Belgrade which is being held as part of the follow-up to the Final Act of the Conference on Security and Co-operation in Europe; they will abide by the provisions of the Final Act, and continue to seek fulfilment of all its provisions by other signatories. They remain committed to the pursuit of détente in their relations with the Soviet Union and the countries of Eastern Europe.
My Government will continue to take part in international efforts to combat recession and promote a more stable world economic order, and a fairer distribution, within an expanding world economy, of the world's wealth between rich and poor nations; they will maintain their special efforts to help the poorest countries and the poorest people.
They will work for a just and lasting peace in the Middle East, and the further improvement of relations between the United Kingdom and all the countries in the area. They will continue to co-operate with all concerned in the search for a lasting settlement in Cyprus, where they welcome the resumption of intercommunal talks. Efforts will be maintained to achieve a negotiated settlement in Rhodesia, on the basis of My Government's proposals published in September this year, which are designed to provide a secure future for people of all races. My Government will be ready during the current session to introduce legislation to enable Rhodesia to proceed to independence on this basis.
MEMBERS OF THE HOUSE OF COMMONS,
Estimates for the public service will be laid before you.
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS,
The strengthening of the country's financial position and balance of payments opens the prospect for a continuing improvement in the economy and the maintenance of financial stability. My Government's main objectives are the speediest possible return to full employment and a sustained growth of output. In order to achieve these objectives they will give the highest priority to further reductions in the rate of inflation.
My Government will continue to take action to reduce high unemployment through manpower measures and to promote industrial training.
They will ensure that the benefits of North Sea oil are used to achieve a lasting improvement in our industrial performance and therefore to provide more jobs, higher real incomes and improved public services.
My Ministers will continue to work in close co-operation with the Trades Union Congress and the Confederation of British Industry.
Internationally My Government will continue to urge that the stronger economies should take the lead in promoting a sustained growth in the world and that adequate official finance should be made available on appropriate terms to countries with continuing deficits in the balance of payments.
My Government remain firmly committed to establishing directly elected Assemblies for Scotland and Wales. Separate Bills will be introduced for this purpose. In Northern Ireland My Government will maintain their aims of establishing a devolved Government acceptable to both parts of the community; and eradicating terrorism by the prosecution through the courts of those responsible for violence and by continuing to develop the effectiveness of the Royal Ulster Constabulary, supported by My Armed Forces. My Government attach special importance to co-operation on matters of security with the Government of the Republic of Ireland. They will continue to seek measures to strengthen the economy of Northern Ireland and improve its social environment.
Legislation providing for the election of United Kingdom members of the European Assembly will be re-introduced.
Further consultations will be held on industrial democracy, with a view to producing proposals which should command general support, and My Ministers will continue directly to encourage the development of industrial democracy in the nationalised industries.
There will be a review of the legislation and institutions governing competition policy, to see that this makes its maximum contribution to improving industrial efficiency.
My Ministers are considering further measures to assist small firms.
They will also hold consultations about encouraging profit-sharing through the tax system.
Legislation will be brought forward to amend company law.
A Bill will be introduced to provide public funds to finance payments to redundant shipbuilding workers in the public sector.
Legislation will be introduced providing for changes in the structure of the electricity industry and other matters affecting the industry.
Continued encouragement will be given to the efficient production, processing and distribution of food with the aim of meeting a greater proportion of our national needs from United Kingdom agriculture. My Ministers will seek improvements in the operation of the Common Agricultural Policy.
My Government will continue to seek major reform of the Common Fisheries Policy. They will aim to secure conditions which will meet the needs of the British fishing industry, conserve fishing stocks, and ensure adequate supplies to the consumer.
A Bill will be laid before you to increase the borrowing powers of the Civil Aviation Authority and British Airways, to provide for a levy to finance aviation security and to amend the civil aviation Acts. Legislation will be introduced for the further development of transport policy to meet economic and social needs, including those of rural areas.
Legislation will be brought before you to provide assistance for first-time home buyers.
A Bill will be introduced to renew and revive the inner urban areas.
Legislation will be introduced on the composition and certain functions of the General Medical Council.
In addition to My Government's full programme of constitutional and other reforms for the present session, they remain committed to bringing forward at the earliest opportunity a number of further highly desirable measures of reform. These measures include improvements in safety and discipline at sea and other aspects of merchant shipping, and the right of Post Office staff to take industrial action.
Legislative proposals will be brought forward for the reform of section 2 of the Official Secrets Act 1911.
Following the Report of the Committee on the Future of Broadcasting, My Government will bring forward proposals on the constitution, structure and organisation of broadcasting in the United Kingdom.
An increase in the limit on public funds for the National Film Finance Corporation will be proposed before the present limit expires.
Measures will be brought before you to reform public sector housing subsidies in Scotland; to improve criminal procedure and reform the criminal justice system in Scotland; and to extend the powers of Scottish local authorities in relation to their direct labour organisations.
Further progress will be made with My Government's programme of law reform.
Other measures will be laid before you.
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS,
I pray that the blessing of Almighty God may rest upon your counsels. CABINET
CROWN AGENTS: FAY REPORT
Note by the Secretary of the Cabinet
1. The Cabinet will shortly consider a draft White Paper to be published at the same time as the publication of the Report by the Committee of Inquiry under Judge Fay appointed in April 1975 "to inquire into the circumstances which led to the Crown Agents requiring financial assistance from the Government". It is proposed to publish the Report of the Advisory Committee of Enquiry into the Crown Agents appointed in 1971 (the Stevenson Report) at the same time. The publication date is at present expected to be 18 November.
2. I attach for the information of the Cabinet Chapter XXV (Summary and Conclusions) of the Fay Report (Annex A) and Chapter 2 (Summary, Conclusions and Recommendations) of the Stevenson Report (Annex B).
3. Copies of the complete version of both Reports are available from the Cabinet Office for any Ministers who would like to read either or both in full.
Signed JOHN HUNT
Cabinet Office
4 November 1977 We have now detailed the "circumstances" which our terms of reference required us to inquire into, and we can look back and summarise what has happened. Our inquiry has been twofold, firstly into what the Crown Agents did (or did not do), and secondly into the efforts, largely unsuccessful, of different organs of government to detect and check the Crown Agents' activities.
In outline we can say that the losses have been due to incompetence rather than to misconduct. The causes have been the actions (and inaction) of individuals, coupled with a defective system. The system was defective in (a) lack of accountability, (b) absence of expert procedures, (c) absence of managerial supervision, (d) bad accounting. Outside agencies contributed to the failure to prevent the losses.
What the Crown Agents did was between 1967 and 1974 inclusive to conduct on their own account a substantial secondary banking activity and in the course of conducting it to engage in investment and lending which was unwise both in character and in degree. They embarked upon this course without seeking independent advice and we find that they possessed neither the skills nor the organisation necessary for such an enterprise. Accountability was lacking. It was unfortunate that the operation developed at a time when it was believed that those deploying funds could hardly avoid making money, and there was thus engendered in the officials concerned an undeserved degree of self-confidence. When crisis came they were totally unprepared, their lack of real banking experience was exposed and they allowed themselves to be locked into situations engendering further losses.
We have no reason to doubt the genuineness of the desire to secure a reserve which was the main reason advanced for the origin of the own-account activities. But there was another factor in this origin, the factor of realisation of the facts that the Crown Agents had large funds to deploy and that there were money-making opportunities open to those with large funds at their command. They had had for many years an embryo "bank" in the shape of the principals deposits taken by the Joint Consolidated Fund and the Joint Miscellaneous Fund, which they deployed in safe investments. Once the eyes of those concerned were opened to the opportunities presented by the management of these and other funds, they embraced the prospect with enthusiasm. One of the remarkable features of the story is the speed with which the enterprises developed. They started in the first quarter of 1967 and by 30 September 1968, when Sir Stephen Luke retired, the Finvest operation had reached the order of £50m, and investment in equities, secondary banks and property companies had started, together with investment in subsidiary companies and in Australian property development. Some of the wilder enterprises, such as unsuccessful speculation in silver and in mining shares, had already been carried out. Thereafter we have the impression that the mainspring of the own-account activities was not the securing of a reserve but the satisfaction of money-making for its own sake.
392 There was thus a substantial secondary banking enterprise in being at the time when Sir Claude Hayes succeeded to the Chairmanship of the Crown Agents. Mr Challis, who had played an important part in its inception, had been chosen to head the Finance Directorate. After Sir Stephen's departure Mr Challis was virtually supreme in his field. He had a newcomer as Chairman, and Boards which he could dominate - the Crown Agents' Board because none of his colleagues possessed the ability to challenge him, and the Four Millbank Investments' Board because its majority were his subordinates. Sir Claude told us that he had been assured by his predecessor "that the one thing I need not worry about was finance. I was told that it was in perfectly good hands and that I could concentrate on other things". At Crown Agents' Board meetings, he said, two of the members, Mr Morris and the Managing Director of Millbank Technical Services Ltd, Mr Roe, would argue with Mr Challis, "but nonetheless his mind was so powerful that he won the arguments". Mr Newman, the Crown Agents' Managing Director, told us, "we were not welcome if we raised questions". Mr Challis would consult his Chairman insofar as he thought it necessary or desirable and, not surprisingly, was successful in eliciting his support. Mr Newman said this of the FMI Board meetings:
"It was quite clear at those meetings that a lot went on between Mr Hayes and Mr Challis - discussions outside the meetings - and we were merely being informed ... what was going on."
Thus the responsibility for the way in which the own-account activities developed rests fairly and squarely on Mr Challis because he conducted them, and on Sir Claude Hayes because he knew, or ought to have known, what was going on. Mr Challis with his subordinates - and indeed with his equals and with all the Crown Agents' personnel save the Chairman - imposed his authority and brooked no interference, as witness his treatment of Mr Nowers (para 121) and Mr Blundell (para 273) and his contemptuous minute repelling Mr Morris's criticisms (para 161). Mr Challis would have us believe that he did not influence the courses taken by the money market managers, and said to us more than once that he had not ever ordered that a loan be granted. We do not believe him. It may well be that he did not direct the day to day operations of the managers; there was no reason why he should. But we have no doubt that the major decisions were his and that, for example, the loans to Stern and the GCA Capital Corporation were made at his behest. It was upon Mr Challis that the lack of accountability worked its effects. His subordinates were accountable to him, but he was in practice accountable to no-one. In theory he was accountable to the Chairman, but the Chairman exerted no effective control over him, and joined forces with him to repel any accountability to external bodies. Lack of discipline undermines morale, and we are sure that the absence of constraints upon Mr Challis played a part in producing and perpetuating the characteristics we discuss below.
Much of the own-account activity was satisfactory and calls for no comment. But alongside the run-of-the-mill deposit operations there were transacted the schemes we have dealt with. And throughout we find that the characteristics of the Finance Directorate under Mr Challis included (i) unjustified risk-taking; (ii) a lack of regulation and control and an aversion from taking advice; (iii) secretiveness; (iv) a low standard of commercial ethics; (v) a haphazard choice of associates.
Mr Challis has been described to us as adventurous. The risks he ran stemmed from two causes; the nature of the investment and the extent of the involvement in them. We have been reminded by witnesses of the fact that the Crown Agents were not alone in suffering misfortune in 1974; the crisis of confidence of that year caused the collapse of many fringe banks, and the over-extended property companies inflicted losses upon the most cautious of the clearing banks as well as upon the Crown Agents. It is true that the Crown Agents were not alone in that time in imprudent financing, and probably many of the fringe banks that collapsed will be found to have suffered from features similar to those exhibited by the Crown Agents. But the prudent banks, though they lent to the Mr Sterns of the time, did so with a proper regard to security and in such proportions as to ensure that losses could be accepted without affecting their own solvency. With the Crown Agents on the contrary it was a case of too many eggs in too few baskets - particularly the baskets labelled English and Continental, Australia and Stern.
We were also pressed with the argument that some of the risks incurred were taken in order to enhance the service afforded to principals. To a limited extent this is true. A number of the associated companies had among their objects the improvement of the facilities on offer to overseas governments. Thus we accept the evidence that the investment in Mr Abrahams's Television Recordings (para 31) included this motivation. But when this argument is used to explain investments such as that in overseas merchant banks it begins to lose credibility and indeed becomes one of the armoury of propaganda weapons so often used by the Crown Agents in their dealings with Whitehall. An extension of this argument is the assertion that all the financial operations were designed to secure expertise to offer to principals. Other propaganda weapons were the representation that the joint funds belonged to the principals (para 126) and the use made of the existence of the Equity Investment Advisory Panel (para 114).
LACK OF MANAGEMENT PROCEDURES
One can understand the own-account operations starting in a small way and needing little by way of rules and regulations at the outset. But a time must come when a properly conducted business grapples with the problem of management and control. In relation to the Crown Agents' business this would involve the monitoring of performance, the accurate reporting of events, and the setting up of a regulatory framework. When Mr Challis became Director of Finance and when Sir Claude came fresh to the organisation, an opportunity was afforded for either or both to take stock, to identify the problem and to take appropriate measures. The opportunity was not taken. Mr Challis was not good at detail. Mr P Matthews, his colleague for a year at First National Finance Corporation, found his methods disappointing:
"He had a tremendous gift for dealing with a problem. I thought he had no gift at all for following it through and tying up the loose ends."
This seems to be the reason why there was such a lack of sound management procedures within the Finance Directorate. There were the monthly reports to the Director showing the state of the money book, and monthly reports of a general nature to the Board but there were no banking rules - certainly no written banking rules; there were supposed to be unwritten rules, eg about the percentage of security which could be lent, but they were vague and often honoured in the breach. Above all there was no systematic management accounting. Thus it was that the Crown Agents fell into such errors as borrowing short and lending long, and lending on insufficient security and the like. The dislike of management procedures probably explains the fading away of the office of Controller (para 91) when it was set up in response to Urwick Orr's advice. And even when the Credit Committee was set up with such formality after the Vehicle & General losses, its scope was limited and its decisions were frequently disregarded (paras 247, 356).
SECRETIVENESS
368 The secrecy in which the Finance Directorate conducted its affairs was a manifestation of the ingrown spirit found within the Crown Agents at the time in question. It was a closed-in body, training up its Personnel from youth and rarely recruiting from outside. We have commented upon the strange results of this policy at paras 42 and 43 above, amongst other things it resulted in the ludicrous situation of this complex trading organisation having only one qualified accountant on its staff until November 1970. The uncertainty in the 1960's over the continued existence of the office intensified this inward-looking attitude, as did the "you are on your own" theory (para 12). Under Sir Claude Hayes communication at other than top level with the Ministry was discouraged (para 367). In the Finance Directorate the prevailing atmosphere of secrecy had the result that no one but Mr Challis could comprehend the state of affairs as a whole, and he at no time shared the complete picture with the Chairman. With secrecy went a rooted disinclination to take advice unless forced to. The Urwick Orr report, commissioned by Sir Stephen Luke, was an exception, but after his time no advice was taken upon management, banking or investment, and Price Waterhouse were brought in to advise only when the accounting system was breaking down. LOW ETHICAL STANDARDS
Though they may have been uncertain of their exact status, the staff of the Crown Agents had no doubt that they were Crown servants. As such, one would expect their conduct to conform with the high standards consistent with their positions in the public service, as indeed Sir Claude pointed out (para 174). But, as we have seen, there were fallings-off from these high standards. Some were personal, such as the taking of the Gramco shares (para 198) and of the gifts bestowed by Mr Stern (para 262). Others were commercial, such as the secret underwriting commission (para 73), the support buying of shares (para 139), the elaborate device employed in window-dressing a balance sheet (para 140), the attitude to Exchange Control (para 127) and the Nation Life affair (para 249). In a class of its own, in our view, stands the bargain between Mr Challis and Mr Walker to avoid the payment of UK taxation both by the Crown Agents and by Mr Walker and Mr Greene (para 233).
Mr Nowers spoke no less than the truth when he said (para 168) that the office had lost its sense of direction in the spiritual sense.
HAPHAZARD ASSOCIATES
A feature emerging from the history we have explored is how fortuitous was the Finance Directorate's choice of associates. Mr Abrahams meets Mr Wheatley by chance, and becomes the Crown Agents' estate agent; he introduces Mr Walker, who becomes their property consultant, and his firm becomes their property solicitors; Mr Walker introduces Mr Caplan, who becomes their valuer. No doubt the Crown Agents did not have to go out to look for business opportunities; when the news got around that they had large funds for investment they did not lack for applicants eager to do business with them especially as they became known in the City, according to evidence given to us, as "an easy touch". But it is a strange organisation which allows a junior official, as Mr Wheatley was at the time, to recruit its professional advisors, and to recruit them not from nationally known firms but from young men making their careers. Let us say at once that we have no reason to suppose that in the main the Crown Agents got other than proper advice from the gentlemen we have named. Mr Walker in particular, who bulks large in this story, not only gave sound advice, as to Australia and otherwise, but also saved the Crown Agents from losses upon their uninstructed plunge into the real property world (para 51). But the solicitors, Davies, Arnold and Cooper, were responsible for losing some security in the Stern case. by not registering charges in time (para 342) and should not have borrowed from the Crown Agents without the latter being separately advised (para 275).
THE LOSSES
401 The losses which we have listed above at paragraph 373 may be classified as due to (i) unsecured lending to borrowers now unable to repay fully or at all; (ii) secured lending where the security has proved insufficient or defective; (iii) support lending in cases where rescue failed; (iv) equity investments in associated companies which have failed; (v) participation in property development and dealing. The equity investments form a small proportion of the whole because the Crown Agents injected money into their associates by way of loans rather than by shareholding. The lending is both in sterling and in other currencies. Sterling lending was the province of the Sterling Money Market Manager, the late Mr Wheatley, whom we did not see for the reasons mentioned in para 3. Mr Wheatley seems often to have made advances upon what has proved to be insufficient security; some of the property valuations relied upon were unduly optimistic and in some cases an unduly high proportion of the valuation was advanced. The non-sterling lending was the province of Mr Blundell, and it is satisfactory to be able to note that despite his unpromising background as a banker (para 43) Mr Blundell succeeded in avoiding major investment errors. The large non-sterling loans to Wilstar (Stern), GCA Capital Corporation, and Tulone were cases where he was required to lend against his better judgement (paras 246, 273, 350), and he can hardly be blamed for the Israel British Bank loss (para 359). Within his personal responsibility come the losses on Galico Investments, Great South West Corporation and Republic Corporation. The first named was a syndicate loan, within a syndicate led by the Crown Agents' banking partners, Continental Illinois, and the other two were small losses incurred early on in his time in charge of the section (para 160). Mr Blundell comes well out of our investigation.
PROPERTY SPECULATION
402 As to financing property, a bank or finance house has broadly two options, one to lend at proper rates on ample security, the other to lend with less security and less, or delayed, return on the loan, but as a quid pro quo to take "a slice of the action" by holding a stake in the equity. The former is a banking operation, the latter an entrepreneurial operation. The former has little risk, the latter produces high profits in boom time and large losses in slumps. The "adventurous" Mr Challis chose the latter course for major investments. It produced a £17m profit on the first English and Continental operation and other lesser sums elsewhere, and now has produced enormous losses.
The sharing and the amount of the E&C profits reaped by Mr Walker and Mr Greene has been criticised by Sir Matthew Stevenson and others (para 216). But if an undertaking is predominantly financed by loans from one lender that lender becomes locked in to the situation and in adverse conditions may have to find more money in the hope of preserving his investment, and in such conditions it is no more than a recognition of the facts to give him a stake in the equity. Moreover if it is one lender's money that enables a concern to make profits it is sensible for the lender to have a share in those profits. What that share should be must be a matter for negotiation and bargaining. Partnerships between capital and expertise are not unknown in the property world, and we are satisfied that it is not uncommon for the partnership to be on a 50-50 basis. In E&C Mr Walker and Mr Greene contributed their expertise not only to policy decision making but also to the running of the companies. On the other hand at the outset their experience was limited and they had yet to make their reputation. In the case of the other major partnership venture, both Mr Fenston and Capital & Counties were well-known and were expected to enhance the enterprise by their reputation. It has been suggested that the bargain with the Fenston syndicate was disadvantageous to the Crown Agents in that the syndicate did little except set the situation up. We are not disposed to find fault with the 50% share in either case. What in our opinion was wrong with these transactions was the going into them in the first place, not the proportions of the split. In the Australian venture there was the added fault, as we see it, of the Crown Agents binding themselves to provide finance far into the future. A body like the Crown Agents, it may be thought, should avoid speculative ventures; it is one thing to be involved in property as an income producing asset or to lend a proportion of a property company's needs against valid security, but it is another sort of transaction altogether to buy Bush House not for its revenue but to re-sell at a profit, or to bind oneself by contract to furnish great sums for re-developing urban sites in Australia for years ahead. Sir Claude Hayes inherited the own-account dealings situation. He could not be expected to oversee in detail the operations of the Finance Directorate, and that directorate was one among many in the organisation he headed. But he had asserted at the outset that Finance was his personal concern (para 91 above), he had the opportunity through presiding at the Crown Agents and Four Millbank Investments Board meetings of amassing information about the Directorate's activities, and moreover as time went on warnings started coming in (paras 161-164). His minutes of February and May 1971 (paras 172-174) show his awareness of some of the Directorate's failings, and by August 1972 he was mentioning one of Mr Challis's major shortcomings to the Permanent Secretary - his readiness to do business inconsistent with the standing of the Crown Agents (para 317). Sir Claude would have known more if he had been more approachable to his subordinates, none of whom among our witnesses, save Mr Challis, found him other than forbidding. In particular if Mr Nowers had had a Chairman to whom he felt able to voice his apprehensions and who would have been able to assess the weight of the complaints, this history would have been very different (para 170). This attitude of his was one of the reasons why internal warnings decreased as time went on; other reasons were the apparent success of the Finance Directorate's operations and the apparent approval given by the Stevenson Committee to those operations. Sir Claude's unapproachability was also partly responsible for the remarkable delay in grappling with the Stern crisis (para 340).
An equally important feature of Sir Claude's outlook was his determination to assert and maintain a position of independence for himself, the Crown Agent, and for the Crown Agents' organisation in his charge. This led to a running battle with the Ministry from the time in 1969 when they discovered Finvest down to the day in September 1974 when he departed. As against government Mr Challis's actions were supported and justified and the attempts of the Ministry to obtain information or to impose some constraints were treated as sinister attacks on the independence of the Crown Agents' office. In a minute written on his last day in office and addressed to his successor, Sir Claude said:
"By 1968 the Crown Agents were still alive and kicking and beginning to be profitable. Treasury and CDM officials suddenly realised this and started a long process of getting direct control over the Crown Agents, including their operations, their assets, their reserves and their property." Sir Claude's partisanship blinded him to the Ministry's real motives in making their inquiries and led him into actively misinforming them upon such matters as the Crown Agents' involvement in the second E&C set-up (para 302). His antagonism, coupled with his vigour and ingenuity in argument, played its part in protracting discussion and prolonging the status quo - and with it the own-account operations in their risky form.
One special feature of Sir Claude's conduct was his failure to replace Mr Challis when he left (para 324). This was because he thought it premature in view of the impending changes in structure. It was a serious error. It led to the Crown Agents being wholly unprepared for the change in the financial climate and wholly unequipped to deal with it. Had a new mind come to the direction of the Crown Agents' finances in November 1973 a great deal of money would have been saved. And had the out-of-depth Mr Hewins felt able to approach his Chairman at the start of the troubles, many further millions also could have been saved.
CORRUPTION
We have had evidence that rumours of corruption in the Finance Directorate have persisted in the City for many years. This is not surprising, because the manner of the Crown Agents doing business was often such as to invite suspicion. We have referred in paras 382-386 above to the various allegations made at different times against the late Mr Wheatley, the Sterling Money Market Manager. At the date of his death he was awaiting trial on criminal charges of corruption in regard to matters with which we cannot deal in a published report for the reasons mentioned in para 3. It is not for us to speculate whether Mr Wheatley entered into some of the loss-making transactions of his section for improper reasons. We can only report that, apart from the subject-matter of the criminal charges, we have found no evidence of corruption, nor has any witness come forward with any specific allegations.
We have however found, in the case of Mr Stern's Christmas gifts (para 262) instances of the Crown Agents staff accepting favours which might be thought to place them under an obligation to a person with whom they had to deal in their official capacity. These gifts were in our view unfortunate. The Crown Agents' staff handbook does not deal clearly with the topic, but it hardly needs a rule to expound the unwisdom of a Crown servant accepting gifts or favours from persons with whom he is doing business. The recent Report of the Royal Commission on Standards of Conduct in Public Life (Cmd 6524) recognised that minor gifts and hospitality are part of the normal courtesies of life but regarded them as "always potentially dangerous". The Royal Commission approved the DoE rules forbidding inter alia the acceptance of gifts other than simple tokens bearing the name of the organisation that gave them (Report, Cmd 6524 paras 214, 217). Mr Challis is especially blameworthy in the case of the Stern gifts in that he should have set an example to his staff. There is a conflict of evidence between him and Mr Hewins over whether he knew of the gift to the latter; we accept Mr Hewins's account and think that when consulted Mr Challis should have ordered the immediate return of the gift to Mr Stern, as well as returning his own.
EXTERNAL CONTROL
409 Turning to the second strand of our Inquiry - the question of external checks - it is satisfactory to note that at the outset the alarm mechanisms worked efficiently. The inception of own-account dealing was recognised by the Exchequer and Audit Department in October 1969 as a departure which should be brought to the Treasury's attention (para 92); in February 1970 the other auditor, the Director General of Overseas Audit Service, reported to the Ministry his misgivings over the operation of the JCF (para 102); and in May 1970 the Bank of England, having picked up items causing them concern, expressed that concern to the Treasury (para 107). The Treasury was the correct department to be approached by the Bank and the E&AD, but it was the Ministry of Overseas Development which would have to come to grips with the situation. The Ministry was at once informed of the E&AD's report, but unfortunately did not learn of the Bank's concern (para 109). The Treasury did serve their own interest and lent impetus to an investigation of the situation.
410 An investigation rather than action was the keynote of the ensuing transactions. What clearly bedevilled the matter was the uncertainty over the Crown Agents' status. The Crown Agents had outlived their original function, and no one knew quite how the transformed organisation fitted into the constitutional framework. If control of the Crown Agents was called for, it was logical to ask whether the power to control existed and to what it extended. This was initially a legal and constitutional question, and, if answered favourably to control, a second question opened out, namely how far it was prudent or politic to exert control. An examination of the problem at once threw up these questions, and unfortunately they were allowed to dominate thinking and obscured the initial practical problem, ie what to do about the own-account activities. With hindsight it can readily be seen that there was an urgent need to ascertain accurately what the Crown Agents were doing, to assess the validity of the reason given (the creation of the reserve), to evaluate the risks being run, and to restrain some if not all of the own-account operations. Without hindsight two officials at the Ministry perceived this; we have quoted sufficient of Mr Smith's and Mr Burr's minutes to illustrate the accuracy of their appreciation of the situation (eg paras 94-96, 104, 106, 298). Unfortunately the Permanent Secretary disagreed: he saw no reason to interfere, although he sanctioned inquiries into the Crown Agents' status (para 98). Thus there was lost the first and best opportunity of controlling or stopping the own-account activities. By early 1970 both the Ministry and the Treasury were thinking in terms of investigation of what the Crown Agents were and what they were doing generally, and when in April 1970 events prodded the Ministry into further action, it was towards inquiry that the officials' minds turned (para 101).
Once an inquiry was contemplated (1970) or decided upon (January 1971) action was postponed; it was further postponed until the Stevenson Committee reported (March 1972) and thereafter while its report was being considered. The more time passed, the more firmly established became the own-account operations and the more difficult it became to control them. These difficulties were enhanced by the approval conferred by the Stevenson report; the fact that this approval was conditional on re-structuring the Crown Agents so as to diminish the risks (para 210) lost its urgency under Sir Claude's reassurances (para 303). Not until August 1973 was action taken in the shape of the statement of principles then imposed (para 304). But even then nothing happened. No doubt the Ministry expected the Crown Agents to take action at once to observe the principles in the conduct of their affairs, eg imparting of information, reform of the quality of investment business. In fact Sir Claude Hayes did little about them. They were left to be put into practice by the new companies mentioned in the principles, and the process of setting up those companies had hardly started when the government changed in March 1974 and further time became needed for the formulation of a new policy. Once the decision had been taken to investigate first and act afterwards - a logical enough sequence - it is difficult to see how any chain of events other than those which took place could have been brought about. What however is plain is that the process could have been accelerated. We have the feeling that the setting up of investigative machinery and the consideration of the constitutional status of the Crown Agents were subjects more congenial to Government than the taking of financial control decisions. But while condemning the delay from October 1969, when the Ministry was first alerted, to August 1973, when the principles were laid down, and to October 1974, when management changed, we recognise that the Stevenson findings were bound to set matters back, that Sir Claude Hayes's vigorous and disingenuous defensive campaign was bound to protract matters, and that the Ministry were never able to obtain a full picture of the own-account scene, owing to the delay in the accounts and the way in which the Crown Agents furnished information which was sparse and sometimes misleading. In particular it is plain that a reason for the Ministry's failure to act on financial control at a critical point in time (end 1972) was their belief that the need for outside control had passed with Sir Claude Hayes declaration that the Crown Agents intended to close down on further venture investment after collecting the POSSEFUND profit (para 303). It was open to Sir Claude to use his authority to impose this new investment policy on his finance directorate. If he had done so many of the losses that we have recorded would not have been incurred. As our narrative has shown he did not do so and risk investment went ahead but was not disclosed to the Ministry.
In spite of repeated experiences of misinformation, or action promised and not taken, the Ministry maintained, almost to the end of his tenure of office, their belief that Sir Claude Hayes was to be trusted to carry out his undertakings to the Ministry. Although exasperated by his intransigence, the Ministry treated Sir Claude remarkably gently, as witness their anxiety to secure his agreement to the form of inquiry (para 190), their handling of the matter of the Gramco shares (para 183), their prolonging his term of office to secure his pension rights (para 365), and their patience with his opposition generally.
We think attention should be drawn to the handling of the crisis of 1974. The Crown Agents' optimistic statements (paras 338, 345) had for long concealed the parlous state of their finances, but at last on 13 May 1974 Mr Hewins's rough balance sheet was disclosed and it became Apparent to the Ministry, the Treasury and the Bank of England that the Crown Agents were insolvent; yet the only action taken was the preparation of the statement of government guarantee, to be released if there was a "run on the bank" (para 346). The organisation which had brought about this lamentable state of affairs was allowed to run on under the same management until Sir Claude retired. His retiring date had just been extended from 30 June 1974 to 30 September 1974. What could and should have been done has been discussed at para 364. In the end the own-account activities were not examined and disciplined until the expiry of the Chairman's term of office.
THE ROLE OF THE AUDITORS
415 The Crown Agents' accounts, as audited and reported on by the Exchequer and Audit Department, ought to have served, inter alia (a) as an annual public record of the own-account activities; (b) as a management tool for the use of the Crown Agents in the performance of those activities and (c) as a means of providing the Treasury, the Ministry and the Bank of England with information and the opportunity to take any appropriate measures of control or otherwise. For various reasons the accounts failed to perform these functions.
416 In October 1969 when the E & AD identified the size and nature of the Finvest operation, and reported thereon to the Treasury and the Ministry, they passed to the proper quarter the question of what authority the Crown Agents had for own-account operations. We note that it might have been possible for the E & AD to make this report a year earlier when first told about Finvest (para 92) but we doubt whether this would have materially altered the course of events.
417 When in October 1971 the Treasury directed that the accounts should be so prepared "as to conform to the standards of disclosure required by the Companies Acts where these are appropriate" (para 117), they were recognising that the accounts were those of a large and complex trading organisation. We think that in some respects the accounts, as audited by the E & AD fell short of those standards. The principal shortcoming was as regards delay. We have mentioned the inordinate delays at paras 280-291. The statutory requirement that the E & AD should make their examination "with as little delay as possible" was lost sight of, and it was plain to us that no one in the Crown Agents, and few outside, felt a need for the accounts or an obligation to furnish them in good shape and in good time (paras 281-285). When at length each year's accounts came out they were next to useless as an informative record because so seriously out of date. Some of the delay may have been due to inadequate audit staff allocated to the Crown Agents (para 283). More important in our view was the apparent lack of concern over the delay on the part of the E & AD higher directing staff, and the failure to report it as a departure from the accounting standards prescribed by the Treasury.
418 As to other audit shortcomings, our narrative has shown situations where the audit process might have, but did not, expose imprudence, irregularity, or even deception on the part of the Finance Directorate in the conduct of the own-account business. Examples are the absence of provision for losses, actual or potential (para 290) and the concealment of massive contingent liabilities incurred by the issue of comfort letters (paras 148-149). But the most significant impression that we gained of the part played by the E & AD in the rise and fall of the Crown Agents as bankers and investors was that they never recaptured the spirit of alertness and perceptive inquiry so clearly shown in Mr Long's report on Finvest to the Treasury in October 1969. We were told that the Treasury valued the E & AD audit especially because of the detailed private report made when needed. One of the great might-have-beens of our inquiry is the remedial action on the part of the government that would surely have followed if the Treasury had asked for, and the E & AD had used their audit scrutiny to supply, further information on the quantity and quality of own-account operations as these developed after 1969.
419 Finally, we must notice the apparent indifference of the E & AD to the failures of the Crown Agents' internal accounting system. The published accounts may have lost their relevance through delay, but at least they were eventually completed and certified. It is not too much to say that internal accounts for effective management purposes were non-existent. Conditions may have been different in other branches of the Crown Agents which we have not examined: our scrutiny of the Finance Directorate has shown that in this field, higher management, from the Senior Crown Agent down, felt no need of such accounts, indeed preferred to be without them. The Crown Agent and his Finance Directorate must answer for the consequences in terms of failure to control the financial transactions that figure in our narrative. But a contributory factor lies in the apparent omission by the E & AD to perform for the Crown Agents the recognised auditor's function of advising management of defects and weaknesses of financial system, a matter they might also have included in their reports to the Treasury.
THE ROLE OF THE TREASURY
420 We have drawn attention above to opportunities that were missed by the Treasury to use their responsibility for the Crown Agents' accounts to inform themselves and the Ministry about the state of the Crown Agents' own-account finances. We appreciate that the Treasury took the view that it was for the Ministry, as the Department of State responsible for the Crown Agents, to deal with the latter over the organisation of their affairs. Nevertheless we think that the Treasury, as custodian of the public purse, might have been expected to press harder for government action to control the Crown Agents, including action to reform their internal management, and to have been less acquiescent in the policy of confining action to the revision of the Crown Agents' constitution. It is ironical to observe that while the Ministry were to the end labouring under misapprehensions over the nature and extent of the own-account dealing, government did not utilise its auditing arm to secure accurate information. Not until Mr Cuckney commissioned Coopers & Lybrand in October 1974 was any accountancy investigation carried out.
THE ROLE OF THE BANK OF ENGLAND
421 The Bank of England is the national central bank. Although not a government department it is publicly owned. It possesses the practical skills and contacts enabling it to detect flaws in the financial world and to provide assistance in remedying them. These attributes are lacking in a government department such as the Ministry or, indeed, the Treasury. We appreciate that the Bank is independent of government, but it is government's major contact with the City, and we think it would not have been unreasonable for the Bank to have played a greater part in this affair than it did. It was astute to detect signs of trouble and its initial warnings were correctly passed to the Treasury. But after that it played a minor role. It would have preferred a different type of inquiry from the one mounted (para 189) and in consequence played little part on the Stevenson Committee's deliberations, whereas fuller information from it might well have modified that Committee's views (paras 218-9). Thereafter the Bank, although frequently consulted (paras 342, 346, 363) remained on the sidelines (para 310). It is unfortunate that it was not invited to take a larger part in the post-Stevenson deliberations. The Banks inquiries by direct contact with the Crown Agents was limited to the pre-Stevenson period. information from it might well have modified that Committee's views (paras 218-9). Thereafter the Bank, although frequently consulted (paras 342, 346, 363) remained on the sidelines (para 310). It is unfortunate that it was not invited to take a larger part in the post-Stevenson deliberations. The Bank's inquiries by direct contact with the Crown Agents was limited to the pre-Stevenson period. IN CONCLUSION
422 The sums granted out of public funds to the Crown Agents will either be lost to the taxpayer, or if repaid out of the future profits of the Crown Agents will be a clog on their competitive position. These unfortunate results flow from (i) an unwise decision to operate as financiers on own-account, (ii) the folly and euphoria with which some of the operations were conducted, compounded by lack of expertise and neglect of accounting systems and professional safeguard controls and (iii) the failure of government to inform itself of the developments, to appreciate the risks and to grasp the need for quick action. Against this sombre finding it is satisfactory to be able to note that no criticism has been made to us of the Finance Directorate's handling of principals' portfolios and that, judging by their continued success in their traditional procurement role, the Crown Agents orthodox activities have not suffered from the publicity accorded to the subject matter of our inquiry.
423 In conclusion we wish to reiterate that we have received complete co-operation from the present staff of the Crown Agents and from the various government departments with which we have dealt. Our research has been conducted with great competence by a team of accountants put at our disposal by Whinney Murray & Co and led by Mr Michael Taylor-Jones ACA and Mr George Elwes ACA. Mr Taylor-Jones has also been our painstaking and efficient Secretary and has earned our especial gratitude by his industry and skill.
E S FAY
EDMUND COMPTON
P GODFREY
N K TAYLOR-JONES Secretary
10 August 1977 Extract from the report of the Stevenson Committee 2.1 The Crown Agents carry on a large and multifarious business including procurement, advisory and personnel services, fund management, banking and ancillary investment (3.1 to 3.3). They employ over 1,700 people, assets of over £400m and they manage principals' investments of over £300m (3.2, 3.1h). Their gross earnings (mostly overseas) amount to about £5m in a year (3.2). The overall result over the four or five years to 1970/71 is that profits on financial activities have been used to offset losses on other activities (3.2).
2.2 The Crown Agents confine their services almost entirely to overseas governments and public bodies. Over 90% of their non-financial business and 70% of their financial business derives from independent countries. The Crown Agents carry on business as agents for their principals overseas; and acting themselves as principals they provide services for overseas clients. An important new element over recent years is the growth of activities otherwise than as agents, particularly in money markets, banking and ancillary investment (3.1, 3.3).
2.3 The Crown Agents office is not a Government Department and the officials are Crown, and not Civil, Servants, although their terms of employment are linked to those of the Home Civil Service (3.6, 3.1h). The Crown Agents have no formal constitution nor are they incorporated. They are individuals appointed by the Secretary of State (3.7). They are responsible to each principal for that principal's business; but there is no collectivity of principals to whom they answer for the totality of their business including business done otherwise than on an agency basis (3.11).
2.4 When the Crown Agents acted mainly on behalf of Dependencies the Secretary of State for the Colonies exercised close supervision over them. Such supervision stemmed from his appointment of the Crown Agents and his responsibility for the Colonies. Such supervision and direction withered away as the Crown Agents services were increasingly provided to independent countries (3.8).
2.5 By virtue of his appointment of the Crown Agents, the Minister has certain powers of direction over them. These have not been exercised in modern times. They are not properly applicable anyway to matters within the Crown Agents banking and agency relationships with independent governments. There are arrangements for informal consultation between the Crown Agents and the Minister. in regard to matters which the Crown Agents consider likely to be of public or political concern and thus involve the Minister. These informal arrangements are not wholly satisfactory, and in practice the accountability of the Crown Agents to the Minister is vague and the Minister's responsibility to Parliament for the Crown Agents affairs is similarly indefinite (3.9 to 3.12).
2.6 The usual apparatus of governance and accountability which is found in the public - and to a lesser extent in the private-sector is missing. The Crown Agents are unincorporated; they have no terms of reference such as are prescribed by statutes or other instruments of incorporation; and they have no prescribed limits for activities or borrowing; they have neither shareholders nor the usual kind of board of directors. The Minister (and his Department) are not by themselves well placed to make good these deficiencies (3.13).
2.7 By reason of their status the Crown Agents at present enjoy Crown immunity from taxation, although they pay SET and the limited companies in which they are interested are liable to corporation taxes etc in the usual way. The Crown connection improves their standing with clients overseas and in the UK. A disadvantage is that in the last resort HMG would probably be liable at least in respect of liabilities arising out of the Crown Agents activities otherwise than as agents, in so far as these could not be met out of the Crown Agents funds. No such call on Exchequer funds has ever arisen; its avoidance depends on the continuing viability of the Crown Agents and the adequacy of their reserves (3.15 to 3.19).
PROCUREMENT AND ALLIED SERVICES : CHAPTER 4
2.8 In 1970 procurement orders placed by Crown Agents amounted to over £90m. The volume of this business has grown moderately over the past decade; but not as rapidly as UK exports generally, and the proportion of non-UK procurement has risen significantly with increasing international competition and the pressure of principals for purchases in the best market. Even so the Crown Agents provide facilities for about 1% of UK exports (4.2 to 4.6).
2.9 Overseas earnings of the Crown Agents procurement business (including stamps and currency business) amount to between £2m and £3m a year - a useful contribution to UK invisible income. But these activities incurred a net loss of £81,000 (general £371,000, stamps and currency £110,000) in 1970, following similar losses in 1968 and 1969 (4.7, 4.26). 2.10 The Crown Agents have a standard list of agency charges for orders of varying sizes. The scale of charges is revised at infrequent intervals. The last review was in 1968 and another is taking place in 1972. Infrequency of review of charges in periods when the Crown Agents own costs rise exceptionally fact is a source of difficulty (h.8 to h.10).
2.11 The Crown Agents risks as agents in procurement and allied services are limited to claims for gross negligence, against which they have normal insurance cover (h.39).
2.12 We conclude that the Crown Agents are providing through their agency procurement work an efficient and valuable service to their principals: they are also helpful to UK suppliers and they make a useful contribution to UK visible and invisible exports: without them some of the benefits would be jeopardised (h.40).
2.13 In order to prevent uneconomic expansion of activities and complaints of unfair trading, we recommend that: these procurement activities should be required fully to pay their way, including appropriate contributions to overheads, reserves and UK taxes. The management may have to make more frequent or more substantial increases in charges, revise charging policy to bring about a closer relationship between full costs and charges for individual orders, or secure further economies in operation - eg through the contraction of the geographical area of their procurement (h.41, h.42).
Engineering Inspection and Engineering Advisory Services
2.14 The Crown Agents provide both in the UK and overseas inspection services for goods whether or not they have procured them. They provide engineering advisory services sometimes in collaboration and sometimes in competition with the private sector (h.14 to h.25).
2.15 The gross earnings from these services is growing (over £700,000 in 1970) and they are clearly valued by principals - especially the inspection services. But they are quite small in relation to the gross overseas earnings of British consultants generally - £30m to £35m a year. The services have been run at a net loss (although we understand that the loss in 1971 will be small). The risks here are similar to those in the procurement business generally and the Crown Agents have normal insurance cover (h.14 to h.25).
2.16 We conclude that there is no sufficient ground for curtailing these services which though small are important to overseas principals especially the smaller Dependencies. As in the case of procurement activities we recommend that: these services should be required fully to pay their way: and in order to preserve the appearance as well as the fact of impartiality, they should be formally separated from purchasing activities, eg in a separate limited company (h.25).
**Millbank Technical Services Ltd (MTS)**
2.17 This 100% subsidiary of the Crown Agents was formed in 1967 with a capital of £1m (£800,000 uncalled) and is in operational and staff terms closely co-ordinat with the Crown Agents. It is a merchanting concern - placing orders as a principal with suppliers and organising complete packages, which it sells as a principal to customers under a contract designed to earn an overall profit. The packages so organised are mainly defence equipment but they also include civilian items like agricultural machinery (h.30 to h.34).
2.16 Turnover which fluctuates greatly from year to year was over £10m in 1969 and £8m in 1970; it seems likely to grow significantly over the years ahead. It made a modest profit (£30,000) in 1970 (h.31, h.34).
2.19 We conclude that: this company is filling a gap in UK arrangements for certain exports: the relationship between the Crown Agents and the Ministry of Defence is useful to both; MTS is substantially protected against risks through insurance with the Export Credits Guarantee Department, through cover from MOD in respect of that Department's element in any package, and through provisions in contracts with suppliers and customers: the Crown Agents are alive to the undesirability of shouldering risks in large contracts beyond the cover which they can obtain. Subject to this point we have no comment on the Crown Agents assessment that the reserve backing against risks should be of the order of £1m (h.35, h.36).
**Marine Insurance**
2.20 This business, which makes a small profit, is carried on by the Crown Agents partly as agents and partly otherwise than as agents. Crown Agents insure only goods they procure. They re-insure 75% of the risks and hold a special reserve against excess claims (h.37, h.38).
**PERSONNEL SERVICES : CHAPTER 5**
2.21 These include recruitment and engagement of expatriates on behalf of overseas governments and public bodies, the arrangement of passages, and the making of certain payments such as pensions (5.1). 2.22 This is a substantial business in terms of numbers recruited and of transactions. Gross earnings amount to rather less than £700,000 a year; but aggregate losses, after charging a due proportion of overheads, have been incurred over recent years (5.2).
2.23 We conclude that: in this field the Crown Agents are performing a necessary and valuable function for which they are well fitted and to which there is no obvious satisfactory alternative: there would be advantages in concentrating as much of this work as practicable in a single organisation like the Crown Agents (arrangements have already been made for certain transfers of work from ODA to the Crown Agents and other transfers are under consideration): these Crown Agents activities could be usefully increased and this should make for economy, efficiency and better financial results. As in the case of procurement activities we recommend that personnel services should be required fully to pay their way (5.3 to 5.7, 5.11).
FINANCIAL AND INVESTMENT ACTIVITIES: CHAPTER 6
2.24 In terms of capital employed, and of profits earned, but not of numbers of staff, these are the largest activities of the Crown Agents. Managed funds (including £200m in banking deposits) amount to over £1,000m. The banking business deploys assets of over £100m. The operational links between the financial activities and the procurement activities are not very close although there is a wide area of overlap between clients for both. These financial activities earn substantial profits which are used to offset losses incurred on most other Crown Agents activities (6.1, 6.2).
Fund Management
2.25 The aggregate managed funds of about £1,000m consist of over 1,000 separate funds of varying sizes. Over 70% of the managed funds come from independent countries and the bulk of the balance comes from Hong Kong. The funds consist of currency reserves, general reserves, and special funds (eg pension funds), of overseas principals. Over 70% of the invested funds are in British Government securities (6.3 to 6.6).
2.26 The funds are managed in accordance with the particular or general instructions of the principals, who receive regular reports and copies of the Crown Agents' Annual Report and Accounts. The Crown Agents maintain the usual internal apparatus for fund management including research unit, investment managers etc. There is also an advisory panel of outsiders but it has very restricted terms of reference (6.7 to 6.9). 1.27 The Crown Agents charges for fund management are very low, and profits correspondingly modest. The risks involved are limited to those of professional negligence against which Crown Agents have normal insurance cover. The Crown Agents consider that a general reserve of £1m should be adequate to cover claims beyond this. We accept that this is reasonable (6.10 to 6.13).
1.28 We conclude that this is an economical service, which gives general satisfaction to the principals, but the performance of the funds might be improved if Crown Agents were able through suitable salaries to recruit and retain more experienced investment managers (6.12).
Banking
2.29 Banking funds of about £1,000m consist broadly of £200m on current accounts, £100m on deposit accounts and £100m which Crown Agents get from the money market. Banking - including income and proceeds from invested banking funds - makes the major contribution to the profits of financial activities as a whole (6.15).
2.30 The Crown Agents banking services are rendered mostly to persons who are principals on the procurement side of the Crown Agents business. On the banking side, the legal relationship is that of bank to depositor; and the profits or losses on banking (and ancillary investment) are on the Crown Agents account. This position is not altered by the existence of the Joint Consolidated Fund and the Joint Miscellaneous Fund which are administrative and not legal entities (6.16, 6.17).
2.31 The Crown Agents employ their banking funds mainly in the money market; they also invest in marketable securities and in advances to companies and overseas clients. They maintain a liquidity ratio of 25% of current accounts and they match appropriately 70% of other maturing liabilities. The liquidity ratio of 25% is higher than that prescribed for banking institutions in the UK but reflects the special nature of the Crown Agents banking business. We conclude that the Crown Agents liquidity ratios and matching arrangements are reasonably prudential (6.19, 6.20).
2.32 Reserves and risks. Crown Agents judge that a suitable reserve against losses would be about £1m, being about 20% of their unsecured lending in the money market. We do not question this specific judgement but we look at the reserve position as a whole in Chapter 8 (6.21 to 6.23). Sterling balances and foreign currency deposits. Over the years 1962 to 1971 the Crown Agents have held 23% to 28% of the total sterling reserves of overseas countries and organisations. At 31 December 70 the amount so held - in the banking and managed funds - was £710m. They also accept foreign deposits for overseas clients (6.24 to 6.26).
We conclude that: the Crown Agents offer very competitive rates of interest on deposits by clients; their ability to do so derives in part from the aggregation of funds which they utilise profitably and it owes something also to freedom from taxation; with increasingly competitive conditions in the banking world the Crown Agents may have to increase their efforts if they are to maintain the volume of profitable business (6.27, 6.28).
Ancillary Investment
The Crown Agents total investment experience in 1970 was unfortunate. On investments of some £35m, depreciation and losses amounted to about £4.6m. It would be wrong to attribute too much weight to results at one particular date; and there has been a substantial recovery in 1971. We conclude that the investment performance has not been outstandingly good but that over the years the Crown Agents' management has on the whole been competent and conscientious although we have some specific criticisms (6.29, 6.44, 6.45).
The Crown Agents invest a fraction of banking funds in 'hard-core' investment: which are not readily realizable. They have a working rule to limit such investment to 20% of their deposits and money market borrowing, other than those in JCF and JHF ie the current account business. This seems to us a sensible enough rule; but on occasions they have been operating at or above their self-imposed limit (6.31 to 6.33).
In July 1971 the Crown Agents had invested a total of over £11m in English and Continental Property Co Ltd (a Crown Agents sub-subsidiary) and the First National Finance Corporation Ltd. A more conservative management might have regarded such concentration as excessive even although most of the investments were short-term and secured. This position was somewhat corrected by 31 December 71. Even so we conclude that there was some risk here (6.34).
English and Continental Property Co Ltd. The biggest single item among the Crown Agents investments (shares and loans) has been the investment in their sub-subsidiary English and Continental Property Co Ltd. At 31 December 71 E & C indebtedness had increased to £13m of which Crown Agents were creditors for £12m secured by a floating charge; there were other loans secured by fixed charges (£10m) and other borrowings unsecured of £23m. At the peak the Crown Agents lendings to their sub-subsidiary amounted to £23m (6.36).
1.39 We commissioned Price Waterhouse and Company to report on the history and development of E & C and the Crown Agents involvement in it. Their report will be forwarded to the Minister but we do not think it necessary to delay our Report on that account (6.37).
2.10 Our conclusions are as follows. This Crown Agents venture grew more quickly and substantially than originally envisaged. We do not think that the process of informal consultation enabled the Minister to be fully seized of this. We think that the Crown Agents took rather too great a share of the risks in relation to the rewards; and that at the peak this investment involved an excessive proportion of Crown Agents resources in a single concern. The size of the Crown Agents stake in E & C has now been substantially reduced. Although Crown Agents advances were secured by a floating charge on the assets (professionally valued) they might in the event of misfortune have found themselves under pressure not to exercise such rights in front of unsecured lenders to their own subsidiary company (6.30).
2.41 Associated companies. The Crown Agents have also invested in and made advances to a number of associated companies - some of which have but a slight connection with services to Crown Agents clients. In one or two cases their associates were perhaps not of a quality and standing which matched that of the Crown Agents. Moreover the proliferation of trading and dominant investments tends to create management problems and there are in them greater risks as well as the prospect of greater rewards (6.41 to 6.43).
2.42 We conclude that too great a burden for investment policy and major investment decisions has to be shouldered by the Finance Director under present arrangements; and that a normal board, consisting largely of suitable independent (ie non-executive) directors could be of assistance in minimising lapses and losses (6.46).
Concluding Commentary
2.43 Our general conclusion is that subject to the withdrawal of taxation privileges and to appropriate organisational and status changes, the Crown Agents financial activities as a whole should continue; they offer an economical and advantageous service to overseas clients: they play a responsible part in the money market, the gilt-edged market, and in the handling of large sterling balances and sterling investments: disruption could cause damage and loss to the Crown Agents and their clients as well as to the UK (6.47 to 6.53).
THE DEPENDENCIES: CHAPTER 7
2.44 The Dependencies' share of the Crown Agents total business is now small - about 8% of non-financial and 25-30% of financial business, the bulk of which is for Hong Kong. The Dependencies (other than Hong Kong) can be only a minor factor in determining the future shape and functions of the Crown Agents as a whole (7.6).
2.45 The Crown Agents business is essential to many Dependencies and especially the smaller ones. This is true of all the services provided by the Crown Agents with the possible exception of financial business which could be provided, if not so cheaply, by other institutions in the City (7.7 to 7.11).
2.46 We have not had a comprehensive view of the importance the Dependencies attach to the Crown connection. We are told that the smaller Dependencies would prefer the continuance of the present relationship but we have heard some dissentient voices. We believe the important thing in the minds of clients is the quality and price of the services and the ethos of the providing body (7.12).
2.47 We conclude that there should be a duty on any successor body - as on the Crown Agents (7.5) - to provide services to the Dependencies, subject to its obtaining a reasonable proportion of the total business of the Dependency, and that the continuance of the Crown connection would not be essential for the discharge of this duty (7.13).
MISCELLANEOUS: CHAPTER 8
Reserves
2.48 Apart from minor specific reserves the 1970 balance sheet shows major reserves approximately as follows:
| Reserve | Amount | Type | |--------------------------|--------|--------| | Investment reserve | £3.4m | specific| | Pensions etc reserve | £6.7m | specific| | Reserve | £2m | general (8.1 to 8.3) | 2.19 The investment reserve of £3.1m was created out of the excess arising on property revaluation and was to cover the difference between cost and market value at that date. With the recovery in the Stock Market in 1971 some of this reserve has since become free (8.2).
2.50 The general reserve at 31 December 70 stood at about £3m as compared with about £1.1m at 31 December 67. The increase over the intervening years was due mainly to substantial revaluation of property and similar adjustments. We are informed that there were hidden reserves of £2m - £5m at 31 December 70; these consisted of the excess at that date of the value of owned and occupied premises over the then balance sheet figure. On this basis general reserves at 31 December 70 amounted in total to £8m - £9m (8.3 to 8.7).
2.51 In the context of our Enquiry Crown Agents estimate of the desirable minimum level of general reserves varied between £17m and £20m in all. The figure and its detailed make-up is very much a matter of judgement and we do not quarrel with these considered estimates which the Crown Agents have put to us (8.8 to 8.11).
2.52 We conclude that: in the years up to 1970 and at 31 December 70 the general reserves were substantially below the desirable level; the Crown connection and Crown status with its implied warranty have helped to offset the insufficiency of reserve strength and have enabled the Crown Agents to enjoy a credit rating which they would not have enjoyed on the strength of their balance sheet position alone (8.12).
Pension Scheme and Reserve
2.53 A separate account is kept for the pension scheme and its liabilities are revalued regularly by the Government Actuary. The assets earmarked to the scheme are managed by an office committee including staff representatives, chaired by the Crown Agents (8.14, 8.15).
2.54 In 1968 the Crown Agents executed a Declaration of Trust whereby the Crown Agents stand possessed of the Office Reserve Fund with discretion to crystallise the trust by alienating the necessary assets to secure the discharge of pension liabilities. A note about the existence of the trust is included in the notes to the 1970 Crown Agents accounts (8.16). 2.55 We conclude that: the present position is unsatisfactory in that the trust extends to the whole Office Reserve Fund and this extension might weaken the confidence of clients in the Crown Agents financial strength; an awkward situation might arise if in time of difficulty the Crown Agents were to crystallise the trust by alienating assets to the pension scheme thus putting them beyond the reach of other claimants. We recommend that the situation of the pension scheme be clarified (8.17).
Accounts
2.56 There has in 1970 been some consolidation of the Crown Agents accounts and fully consolidated accounts are being produced for 1971. We are impressed by the complexity of the various company structures through which the Crown Agents conduct some of their activities. We conclude that: it is desirable that there should be a single auditor experienced in the commercial and banking sphere for all the main Crown Agents activities; and that reconstitution on the lines we recommend would provide an opportunity for further consolidation of audit and accounts (8.18 to 8.20).
Salary Levels
2.57 The Crown Agents activities consist predominantly of business and not administration in the governmental sense and top officials in the Crown Agents office bear greater personal responsibility than counterparts in the Civil Service. The present responsibilities of the Director of Finance would in commercial circles command a salary of perhaps twice as much as his present salary. We think there is a significant degree of underpayment in the Finance Directorate which extends down as far as the investment managers, and this affects the Crown Agents ability to recruit and retain suitable staff. There may be implications here for other top posts in the organisation (8.21 to 8.24).
Taxation
2.58 The Inland Revenue has hitherto treated the Crown Agents in effect as the Crown and thus entitled to Crown immunity from taxation; although limited companies in which the Crown Agents have interests are liable to tax in the ordinary way. We have received representations that the tax privileges allowed to the Crown Agents give them an unfair advantage over their private sector competitors. This applies particularly to the Crown Agents financial and banking activities which have grown rapidly over the last few years and are the main source of profits. We recommend that on the grounds of taxation principle and fair competition the Crown exemption from taxation should be eliminated; this could be done through the various models discussed in Chapter 9 (9.25 to 9.27).
Relationship between Crown Agents, CDC, and CDGC
2.59 Relations between the Crown Agents and CDC (a nationalized body) and CDGC (a private sector body) have hitherto been minimal. There are large geographical and some functional overlaps. There may be possibilities for some rationalization among these bodies and we suggest that some further examination of this might be justified (9.20).
STATUS, CONSTITUTION AND OBJECTIVES: CHAPTER 9
2.60 We have noted the following defects in the present situation:
Arrangements for accountability in respect of the totality of the business and especially the business done otherwise than as agents are less than adequate (9.2);
The present Crown status is a source of ambiguity, anomaly and risk and of complaints of unfair trading. There is an implied Crown warranty behind Crown Agents and this is of particular significance in their activities otherwise than as agents (9.3, 9.4);
The normal apparatus of governance is absent - ie incorporation with stated objectives and limited powers, shareholders' meetings, a proper Board and the discipline of the profit motive (9.6 to 9.8).
2.61 Although we cannot say that any significant damage has been done we cannot in view of these defects and associated risks recommend the continuance of the Crown Agents with their present status, composition and range of functions (9.9).
A Solution through Change of Functions
2.62 We have examined the possibility of minimizing the defects and the risks by contracting the field of Crown Agents activities - eg by return to the boundaries of their activities in 1967, the reduction of money market activities, or by confining them to their traditional role of serving only the Dependencies. We conclude that these courses are impracticable or undesirable. Severe contraction or liquidation would be highly disturbing and damaging to the interests of overseas countries and the UK (9.10 to 9.15). 2.63 We develop and examine some new model structures, involving different degrees of HMG involvement. We do not doubt that under present arrangements the Minister has certain powers of direction over Crown Agents, though they have for practical reasons not been exercised in modern times. In view of the independence of most of the clients, the necessity of observing the integrity of principal/agent and banking relationships, and the nature of the business, we conclude that arrangements which minimise the involvement of HMG and Parliament would be the most appropriate (9.17).
2.64 We examine in our report four models all of which would incorporate Crown Agents activities, eliminate Crown immunity, and reduce all or some of the other defects and risks in the present arrangements. In essence these models are:
Model 1 A Nationalized Corporation (9.19 to 9.24) Model 2 A private sector body with minority governmental interest (9.25 to 9.35) Model 3 A limited company with HMG (or HMG and Dependencies) as a majority shareholder and independent countries as minority shareholders (9.36 to 9.43) Model 4 A limited company with shares owned by HMG (9.44 to 9.51).
2.65 We do not seek to summarise all the characteristics of these models but we note these points. Model 1 would have the advantage of clarity but would make HMG fully responsible for the business and would almost certainly be unacceptable to the independent countries (9.24). Model 2 would remedy all the defects in the present situation; but its feasibility would depend entirely on private participation which seems unlikely (9.34, 9.35). Both Models 2 and 3 envisage shareholding participation by overseas countries which we regard as important but may be difficult to realize (9.29, 9.30, 9.33). Model 4 would involve HMG more closely than now; it is in effect an informal version of a nationalized body; but it could be used as a stage to Models 3 or 2 (9.51).
Conclusions and Recommendations
2.66 Choice among the models would depend significantly on the results of consultations with overseas clients of Crown Agents and their reactions. Our impression is that the Crown connection in the Crown Agents activities is not of prime importance (9.51) but this needs to be tested in concrete discussions with overseas clients. Another factor is the need for legislation. As far as we can judge all models - with the possible exception of Model 4 - would require legislation (9.55). We cannot evaluate these factors at this stage. We would regard Model 1 at best as a solution of last resort (9.2h). On intrinsic merits we recommend the other models in the following order:
Model 2 Model 3 Model 4
(9.56). CABINET
CROWN AGENTS: THE FAY REPORT
Memorandum by the Lord Chancellor
1. The Committee under Judge E S Fay which was appointed in April 1975 to enquire into the causes of the financial problems of Crown Agents has now reported. (A summary has been circulated with CP(77) 101). A group of Ministers under my chairmanship has considered the Government's reaction to the Report.
2. The Fay Report is a thorough and well-balanced study which reveals a deplorable state of affairs in the past. Their main criticism is directed at the investment operations undertaken on their own account by the Crown Agents but there are also criticisms of Government Departments, the Exchequer and Audit Department and the Bank of England.
PUBLICATION OF THE FAY REPORT AND THE GOVERNMENT'S REPLY
3. Publication of the Fay Report to which the Government are committed will attract much publicity and criticism of Government under both Labour and Conservative Administrations, although the main responsibility for inaction must rest with the latter. We think it is essential that a White Paper giving the Government's comments on the Fay Report should be published at the same time as the Report itself. A draft is annexed. It states unequivocally that the Government accept the conclusions of the Fay Committee (paragraph 1) and then deals with the steps which have already been taken to reorganise the Crown Agents (paragraphs 5 to 10 and 21) to define clearly their relationship with the Minister (paragraphs 16 to 19 and 22) and to disengage them from their property and secondary banking activities (paragraphs 20, 23, 25 and 26).
STEVENSON REPORT
4. It is proposed to publish as an Annex to the White Paper the Report in April 1972 of a Committee under Sir Matthew Stevenson which examined the status, functions and financial operations of the Crown Agents. (A summary has been circulated with CP(77) 101). The then Minister (Mr Richard Wood) told the House of Commons on 8 November 1971 that it would not be appropriate to publish the Report of the Committee since most of the work of the Crown Agents was for independent Governments. It is possible that some witnesses may have had this statement in mind in giving their evidence. However with minor editing which has now been done the Report can be published without prejudice to the principals of the Crown Agents and without risk of breach of confidence. The Fay Report quotes from it at length and comments that an edited version could have been published with beneficial results. The Chairman and two of the three other members of the Stevenson Committee have said that they think that the references to it in Fay make it desirable to publish the Stevenson Report. Mr Richard Wood has been consulted and considers that it is right in the circumstances to publish.
ACTION AGAINST CULPABLE INDIVIDUALS
5. Criminal proceedings have been started against two of the people involved in the Crown Agents affair - Mr Bernard Wheatley, the former sterling money market manager of Crown Agents who has since died and Mr Sidney Finley, a financier whose companies had dealings with Crown Agents. Civil proceedings for recovery of moneys are being taken in three cases and the possibility of taking them in other cases is under examination. In addition the Ministerial group thought that there should be an enquiry by an independent Committee with the terms of reference in paragraph 14 of the draft White Paper to establish the gravity of any neglect of duty by people in the public services and to assist those concerned in deciding whether disciplinary action should be taken. The Ministerial group thought that this enquiry should cover the Bank of England and the Exchequer and Audit Department as well as the Crown Agents and Government Departments: for this it will be necessary to secure the co-operation of the Governor and before the enquiry is announced it will also be advisable to consult the Chairman of the Public Accounts Committee and the Comptroller and Auditor General. This procedure would follow the precedents of Crichel Down in which Sir Andrew Clark's Inquiry (Cmd 9176) was followed by the Woods Committee Report (Cmd 9220, July 1954) and the Bossard case, in which the Security Commission's report was followed by the Wilson Smith Inquiry (Cmd 2773, September 1965). It is quite likely that this enquiry will result in little or no disciplinary action because those who appear most culpable have left the public service and their pensions cannot be forfeited or abated unless they are convicted of a criminal offence in connection with their job. While a minority of us thought that in the circumstances the setting up of a disciplinary committee would be futile, the majority felt that public opinion would not be reassured if no further inquiry were conducted. LEGISLATION ON CROWN AGENTS
6. At their meeting on 11 October (CM(77) 30th Conclusions, Minute 1) Cabinet asked the Ministerial group to consider the degree of urgency which should be attached to legislation to give the Crown Agents corporate legal status. The group took the view that with the action already taken to reorganise the Crown Agents and to define their relations with the Government, legislation was not essential immediately for constitutional or administrative reasons. Parliament could probably be satisfied that the necessary remedial action had been taken and the Crown Agents' house already put in order. Further consideration might however have to be given to the timing of legislation in the light of Parliamentary and public reaction to the Fay Report.
CONCLUSIONS
7. I invite the Cabinet -
8. To agree to -
a. publication of the annexed White Paper at the same time as the Fay Report is published;
b. publication of the Stevenson Report as an annex to the White Paper;
c. the establishment of an external enquiry into the extent of neglect of duty on the part of individuals in the public services.
9. To take note that the Ministerial group considered that immediate legislation to give the Crown Agents corporate legal status was not essential but that this question might have to be reconsidered in the light of Parliamentary and public reactions to the Fay Report.
E-J
Lord Chancellor's Office
7 November 1977 Introduction
1. The Report of the Committee of Inquiry on the Crown Agents is being published today as ........... It is published in full. The Government and the Crown Agents accept the Report as a fair and searching investigation into the facts; and accept the Report's conclusion that there were serious shortcomings on the part of the Crown Agents and that Departments and other outside agencies contributed to the failure to prevent losses. The Minister for Overseas Development, to whom the Report is addressed, has conveyed her thanks to Judge E.S. Fay, Q.C., Sir Edmund Compton, G.C.B., K.B.E., and Mr. P. Godfrey, F.C.A., for their thorough and exhaustive work on a most difficult and complex subject.
2. The terms of reference of the Committee of Inquiry, which was appointed on 23 April 1975, were:--
To enquire into the circumstances which led to the Crown Agents requesting financial assistance from the Government.
It will be recalled that in December 1974 the Crown Agents received from the Government a recoverable grant of £35 million. However, the Committee was not specifically asked to consider those aspects which bear directly upon the exercise of proper control over public bodies, although its Report touches upon some of these.
3. The Government therefore wishes to provide certain additional information, and believes it will be of assistance to Parliament to set out in sequence the Parliamentary consideration of these matters. This is done in Annex I which contains all the major Ministerial statements about the Crown Agents since November 1971. The Government also wishes to state its policy in relation to the Crown Agents, and to reaffirm its confidence in, and support for the present Board of the Crown Agents and for their work.
4. In view of the relevance of the report of the Stevenson Committee to the history of subsequent events, the Government has decided that it also should now be published. It is printed in a separate volume (House of Commons return Number 000) as Annex V.
The Future of the Crown Agents
05. Before making its comments on the clear failures of the past, the Government wishes to place on record its view of the future of the Crown Agents. The Fay Report explores and elucidates a phase in the conduct of the Crown Agents' affairs which ended, and ended decisively, three years ago. It is, in effect, an essential account of conduct and events which are now a question of historical concern rather than present anxieties, although their financial consequences are still with us.
06. The Crown Agents are now performing their invaluable services on behalf of their Principals, who include 67 Commonwealth Governments, Associated States and Dependencies; 152 Commonwealth public bodies; and 57 non-Commonwealth governments and agencies, in the secure confidence that the Government stands behind them during a period, which will inevitably last for some time, of gradual disengagement from the ill-advised and disastrous speculative involvements of 1967 to 1974. Since December 1974, the Crown Agents have been undertaking an orderly and phased withdrawal from property and secondary banking. The Government's assurance means that the position of all depositors is fully safeguarded.
07. The Government wishes to make clear beyond doubt its unequivocal and firm support for the Crown Agents. It has created a service to developing countries which at the same time provides a channel for traditional and new supplies of goods and services to the wide and expanding market of the third world. Its origins lay at the heart of nineteenth century colonialism, when its role (from 1833 onwards) was to procure goods from Britain for the colonies. In the last 20 years, it has built and transformed the past into a confident and greatly appreciated relationship with the countries and public agencies of developing countries all over the world. The Crown Agents serve them; and in doing so, they are a crucial element in Britain's relationship with countries overseas.
08. The Crown Agents functions will be the traditional services of procurement, recruitment, technical advice and management. The exact pattern of such future development cannot, of course, be predicted, for it will be determined by the degree of expansion of the Crown Agents' own relationship with their overseas Principals, and by their response to new needs for goods and services as they emerge and are identified. The Government believes that all concerned can be confident that the Crown Agents have ahead of them a future of promise and achievement.
09. The Government is reinforced in this belief by its awareness of the capabilities of the present Chairman and his Board. The seriousness of the situation which we and they faced in the autumn of 1974 was not one which they could have expected, in the absence of up-to-date financial information. That so much that was wrong has been and is being put right, and that activity on behalf of overseas Principals has increased in the last three years is a tribute to them, and particularly to the Chairman, Mr. John Cuckney.
10. The Government will introduce as soon as possible a Bill to incorporate the Crown Agents: a commitment made to Parliament in October 1975. This will not affect the Crown Agents' relationship with their overseas Principals. But it will clearly define the relationship between the Crown Agents and Ministers which was obscure after the rapid move to independence of the Colonial territories in the early 1960s; and will provide for the proper exercise of public accountability. Meanwhile the Government has taken the administrative action detailed below, designed to secure these objectives pending legislation.
11. It is manifest from the inquiries of the Committee that during the period from 1967 to 1974 the conduct of the affairs of the Crown Agents, and, in particular, the actions of certain of its staff, lacked competence and good judgment. As the Committee explain in paragraph 3 of the Introduction, they have made a separate report on matters relating to the late Mr. Bernard Wheatley, the Crown Agents' former sterling money market manager, and Mr. Sidney Finley. That Supplementary Report is not being published, because these matters are sub judice, but has been referred by the Minister of Overseas Development to the Director of Public Prosecutions. With the possible exception of matters covered in that Report, the Committee found no evidence of corruption among the Crown Agents' staff. As regards exchange control, investigations by the proper authorities are proceeding. The Committee's report on the Crown Agents' acquisition of shares in the First National Finance Corporation Limited in 1969 to 1970 (paragraph 73) was referred to the Director of Public Prosecutions, who found no grounds for proceedings against the individuals in question. However, it is clear that the own-account activities of the Crown Agents did not accord with the proper standards of behaviour of public bodies. It is to be noted that the other activities were properly conducted.
12. It is evident that during this period, there was a lack of clarity concerning the constitutional relationship between Ministers and the Crown Agents, and that the information made available to Ministers was incomplete. It is recognised by all concerned that for much of the period between 1967 and 1974 the growth of the Crown Agents' own-account business, and the pattern of its investments, as outlined in the Report, was inadequately monitored and scrutinised. The Government accepts that this represented a failure to apply the normal principles of public accountability.
13. The Government believes that its efforts to explore the causes of this failure; its decision to lay all the facts before Parliament; and its efforts and success in re-establishing the Crown Agents on a sound footing, will be regarded as firm evidence of its determination that the conduct of public affairs shall be honourable, and shall be seen to be do.
14. The Government has decided to set up a Committee of Inquiry with the following terms of reference: "To examine the facts and assess the nature and gravity of any neglect of duty on the part of those employed in the Crown Agents, the Ministry of Overseas Development, the Treasury, the Bank of England and the Exchequer and Audit Department, so as to assist in deciding whether appropriate action is required". This follows the precedent of the Committee which reported in July 1954 on persons involved in the Crichel Down inquiry (Cmnd. 9220) and the Board of Inquiry which reported in September 1965 following the report of the Security Commission on the Bossard and Allen cases (Cmnd. 2773).
15. At the same time, it is important to emphasise that the traditional activities of the Crown Agents in providing services to their overseas Principals have continued, and are continuing successfully. As the Fay Committee has pointed out, what went wrong was a part only of the Crown Agents' financial activities, and those activities themselves formed only a part of the Crown Agents' total business. Judging by the continued success of their traditional role, the Crown Agents' orthodox activities have not suffered from the publicity accorded to their own-account business, and in 1975 and 1976 the traditional agency services produced gross income of £11 million and £17 million respectively. These services had for nearly 150 years past been the reason for the Crown Agents' existence; they will now be the basis for a continuing future.
The Constitutional Position
16. The Committee of Inquiry outlines the progress of efforts to establish the constitutional relationship between the Crown Agents and Governments from February 1970 onwards. This was not an easy matter. The Crown Agents, from 1833 onwards, were an agency under the direct control of the Secretary of State for the Colonies. They supplied the goods and services required by the Colonies. Their role was not questioned or examined until a Select Committee of the House of Commons investigated and reported in 1909, following which it appears that their role continued as before, under the firm control of the Secretary of State for the Colonies.
17. The constitutional relationship was well understood and worked satisfactorily until the process of decolonisation occurred. The Crown Agents then began to undertake procurement of goods and services for independent governments and their parastatal agencies. Their formal responsibility continued to be to the Secretary of State for the Colonies. until 1961 when it passed to the Secretary for Technical Co-operation, and from him to the Minister of Overseas Development in 1964. It will be of interest to Parliament to note that during the 64 years from 1909 to 1973, only 18 PQs touching upon aspects of the Crown Agents' work were tabled and answered.
18. The enquiries into the constitutional relationship which were initiated in 1970 were necessary. The exercise of effective control, and public accountability, cannot be divorced from a clear definition of Ministerial responsibilities and powers. It is an important element in the history of the relationship that no such clear definition existed between about 1960 and 1974.
19. The Government's White Paper (Cmnd. 6445) on "The Future of the Crown Agents", promised in October 1975 and published in April 1976, outlined proposals for legislation to give the Crown Agents a corporate legal status, to define their functions, and to define the powers of the Minister. The Government believes it to be essential that the constitutional relationship shall be clarified, defined, and given legal status. Legislation will ensure a continuing basis for the traditional role of the Crown Agents in providing procurement, recruitment, technical, advisory and financial management services to their overseas Principals.
The Present Financial Position
20. All new own-account investment of the kind described in the Committee's Report has ceased. Since December 1974 the Crown Agents have undertaken an orderly and phased withdrawal from property and secondary banking. In February 1975, the Minister of Overseas Development (Mrs. Hart), after consultation with the Board of the Crown Agents, set out in a directive the main principles which were to govern that withdrawal and the Crown Agents' future investment and lending policy. This directive is reproduced in Annex II. Special accounting arrangements have been agreed to ensure that the Crown Agents account separately for those investments from which they are disengaging, and proper accounting provisions have been made against bad and doubtful investments on past own-account activities.
21. Since October 1974 the Crown Agents have had a proper Board structure including independent part-time members appointed by the Minister and directly responsible to her. A complete internal reporting system has been established, with clearly defined levels of authorisation and control. In this connection, the Crown Agents' management accounting and financial information system has been completely reorganised and professionally qualified people have been appointed from outside the organisation to bring in the necessary expertise. The accounts are now published in accordance with Ministerial direction agreed with the Treasury governing their timing and their form so as to give the fullest measure of disclosure. New legal advisers and independent valuers have been engaged. In particular, the Crown Agents have sought independent professional advice on the management of their disinvestment programme. A special London Advisory Committee has been set up to advise the Board on the Crown Agents' Australian interests, and includes two property consultants and a representative of Morgan Grenfell and Co. Limited.
22. Close working relations have now been established between the Crown Agents and the Ministry of Overseas Development. The Ministry and the Treasury have been kept fully in touch with the Crown Agents' position and policies relating to financial matters, and progress in realising their own-account investments. The Bank of England has been consulted in appropriate cases. Arrangements have been agreed under which the Chairman makes regular reports to the Minister on matters of special interest, and the Ministry and Treasury receive comprehensive management accounts every quarter. These arrangements are recorded in a set of guidelines issued in July 1977, which are reproduced at Annex III.
23. The withdrawal from property and secondary banking activities must necessarily take time. Much progress has been made, as is shown in the account given of individual investments in Annex IV. But some of the concerns in which the Crown Agents have invested money have gone into liquidation, and the Crown Agents have had to await settlement of their claims along with those of other creditors. In other cases, the problem has been to strike the right balance between disengaging quickly on the one hand, and recovering as much as possible of their investment, thus minimising the final loss to the taxpayer, on the other. This has been particularly important in regard to the Crown Agents' Australian investments. A broad strategy for the management of the Australian operations has been agreed with the Minister. She is also consulted about other major decisions on disengagement.
24. The traditional relationship between the Crown Agents and their overseas Principals is in no way brought into question by the own-account operations of the past. It is essential that the customary standards of confidentiality should continue to be strictly observed in respect of transactions undertaken as agents on behalf of overseas Principals.
25. The Crown Agents now have complete control over their property investments in Australia, from which a lengthy period of disengagement appears to offer the best prospect of reducing any demand on public funds. They are no longer involved with their former partners in the English and Continental Group. They are in the process of disengaging from their merchant banking investments in the Caribbean. Following the bankruptcy of the Stern Group, they are participating in a Scheme of Arrangement approved by the Court with an independent Administrator, as the most effective way of recovering as much as possible of their investment. Civil proceedings have been instituted to recover some of the moneys lost and the possibility of further such action is being considered.
26. The Crown Agents' Accounts for 1976 show that as at 31 December 1976, the deficit on the own-account investments in property and secondary banking (the Realisation Account) was in total some £212 million. The ultimate loss will not be known with certainty until the complete disengagement of the Crown Agents from the property and secondary banking activities of the past have been completed; this process may take some years. But it is already clear that the final deficit may well be in excess of £200 million. Should the need arise, the Government's undertaking that it stands behind the Crown Agents will be fulfilled by putting proposals to Parliament for further financial assistance. Given the experience of the recent past the Government believes it wise to reassert its commitment to the Crown Agents, to give its present quantitative assessment of that commitment, and to undertake to inform Parliament if the degree of that commitment requires revision.
27. There has been a most severe failure of public accountability. The causes of this are made clear by the Report of the Committee of Inquiry, and are supplemented by the additional information presented here.
28. The Crown Agents are now on a different and better footing. Their constitutional position and their relationship with Ministers have already been clarified and will be established by legislation. Accountability is now established, and the disasters of their own-account activities of the past are being gradually remedied, at the cost of Government financial support. The Crown Agents' senior staff most criticised by the Report are no longer with the Organisation.
29. The Government places firmly on record its confidence in the Board of the Crown Agents and in its traditional activities now and in the future on behalf of its overseas Principals. It stands behind the Crown Agents. On 8 November 1971 the Minister for Overseas Development (Mr Richard Wood), in reply to a question from Mrs Judith Hart, announced the appointment of a Committee under Sir Matthew Stevenson to consider the need for any changes in the status, functions and financial operations of the Crown Agents. The full text is given below.
Mr. Morris is a director in his official capacity of Sterling Industrial Securities, in which the Crown Agents have a financial stake. In the summer of 1970 he told his chairman, Mr. Hayes, of his wish to purchase some shares in this company with the gratuity he would receive on retirement in September, 1970. Meanwhile my Department, who had no knowledge of the proposed share transaction, agreed to the chairman's request that Mr. Morris should remain in temporary employment as a Crown Agent for a period after his retirement from pensionable service. Mr. Morris acquired shares in the company in October, 1970.
Last February Mr. Morris became chairman of, and also purchased shares in, a private company which includes Sterling Industrial Securities among its bankers.
Looking back on this whole sequence of events, and taking account in particular of Mr. Morris's retention as a Crown Agent for longer than was originally contemplated, I consider that the Crown Agents should have recognised that these arrangements might not be wholly compatible with Mr. Morris's continuing employment as a Crown Agent. I have discussed this with Mr. Morris, who is coming to the end of a long and devoted career in public service, and, in recognition of this difficult situation, he has undertaken to dispose of the shares without profit to himself.
Mrs. Hart: I thank the Minister for that statement and recognise that it needed to be as long as it has been.
May I, first, say that we shall want to study this very carefully, in particular some of the implications of what he has said? Second, may I say that we are glad that the question of Mr. Morris's shareholding has now been cleared up, but that this clearly indicates how important it is to get the constitutional relationship between Government and the Crown Agents right?
Why is he so determined not to publish the report of the inquiry when it is complete? I must tell the right hon. Gentleman that we shall press him on this. I should find it quite wrong if a report on such an important constitutional matter were not to be made available to Parliament. Second, why has it taken so long to make this statement?
As the right hon. Gentleman said, I asked for the official departmental look at this in the spring of 1970, yet it is only now—in the summer—that he has set up the Committee. Lastly, will the Committee, whose names he is about to publish, include representatives of Commonwealth Governments or of the Commonwealth Secretariat, recognising the key role that the Crown Agents play in the economic relationship between trade in Britain and Commonwealth countries?
Mr. Wood: On the first of the right hon. Lady's points, on publication, I have taken the view that the relationship between the principals, most or many of whom are independent Governments, and the Crown Agents themselves on the other side, is of immense importance, and that it would therefore be unwise and wrong to publish a report which could possibly badly affect that relationship. That is why I announced the decision that I have.
As for delay, I suppose that perhaps we have all been rather slow in getting round to this. The Crown Agents have now existed since 1833—therefore, for about 140 years. The Labour Party, the Conservative Party and the Liberal Party perhaps could have acted a little earlier in considering what should be the proper relationship between the Crown Agents, in new circumstances, and the Government. But in comparison with those 140 years, the period between the right hon. Lady's initiation of this examination and the report of the Stevenson Committee will probably be a little less than two years, and therefore rather insignificant beside the length of life of the Crown Agents over the centuries.
As for the members, I will publish their names, as I have said, in the Official Report. This is a small committee, which does not contain the membership which the right hon. Lady suggested, but it will, I hope, satisfy the House of Commons that these matters will be very carefully looked into.
Mr. Dalyell: For what reason did the Department not have knowledge of the share transactions?
Mr. Wood: Because they were not reported to them.
Mr. Arthur Lewis: Could the Minister tell us whether this arose as a result of the scandal which was revealed by the Sunday Times and Private Eye? If so, will the right hon. Gentleman pay a tribute to the Sunday Times and Private Eye for starting this scandal? After all, Private Eye is very rarely praised in this House, and it might make a change to do so.
Mr. Wood: If the hon. Gentleman will show me the reports which appeared in the Sunday Times and Private Eye, I will see whether they deserve a tribute.
Mr. George Cunningham: Will the right hon. Gentleman bear in mind that, despite this regrettable incident, the Crown Agents have a very high reputation throughout all aid donors in the world for providing facilities in developing countries which no other donor can equal?
Will the report, if it is not to be published, at least be given to the overseas principals which use the Crown Agents so that they can be sure that things have now been put right inside the Agency?
Mr. Wood: I am glad that the hon. Gentleman made the first point. I should like to have made it myself. I think that the confidence of the principals in the activities of the Crown Agents is shown by the amount of business that they place with the Crown Agents.
As I explained to the right hon. Lady, I have taken the view that the report should not be published. As the report is about the desirable relationships for the future between the Crown Agents, on the one hand, and Her Majesty's Government, on the other hand, I have naturally kept the various principals fully in the picture so that they will know what is happening, and I am certain that the existence of the Committee will not impair the relationship between the Crown Agents and their principals.
Mrs. Hart: May I press the right hon. Gentleman a shade further on the question of publication. As he will appreciate, my concern was that the constitutional relationship in this case between a Minister and the Crown Agents whom he appointed but who had no other responsibility whatever, either financial or otherwise, to government seemed unsatisfactory. To the extent that the inquiry is directly concerned with this constitutional relationship, I believe that this is a matter which it would be perfectly proper to make public knowledge. We do not have other constitutional relationships between Ministers and inside bodies or public bodies which are not known fully to Parliament.
Mr. Wood: The right hon. Lady will understand that the committee will have to consider in some detail the relationship between the Crown Agents and the principals as well as the relationship between the Crown Agents and Her Majesty's Government. That is why I promised to make a further statement to the House when I receive the Committee's advice in the light of what the Committee thinks should be the future relationship between the Crown Agents and Her Majesty's Government. However, I do not think it right to publish the report. I do not think the report could be nearly as useful if I did not make that statement.
Following is the information:
The Committee's terms of reference are to consider whether there is a need for any changes in the status, functions and financial operations of the Crown Agents, including particularly their relationship to Her Majesty's Government, having regard to:
- Developments which have taken place in recent years in the nature of their functions and in the constitutional status of their principals;
- and to the United Kingdom's own interests including the needs of the remaining dependencies;
and to make recommendations on the nature of any such change. The Chairman is Sir Matthew Stevenson, K.C.B., C.M.G., and other members are:
Sir Glyn Jones, G.C.M.G., M.B.E. Mr. M. J. Verney. Sir Charles Whishaw. Mrs. Hart: Amongst the investment subsidiaries of the Crown Agents have been a 51 per cent. controlling interest in the English and Continental Property Company and substantial interests in Metropolitan Properties Limited, and many of the property companies they have invested in during the last few years have certainly been speculative. The right hon. Gentleman says that the trustee arrangements are proposed to hold good, and the question is whether he proposes that those arrangements will or will not exclude property dealings. [Hon. Members: "Oh."] I think hon. Members opposite are a little less informed about this matter than are some of my hon. Friends.
What matters here is whether the right hon. Gentleman is prepared to say to the Crown Agents that these new arrangements on the trustee analogy should exclude investments in speculative property developments. This is the point about which the Opposition are rightly concerned. The right hon. Gentleman has said that the Crown Agents will finally be answerable to him, but he is, of course, answerable to this House. What is to be the relationship between his answerability and their answerability to him, because the situation is profoundly unsatisfactory? Finally, what is to be the position about the personal shareholdings of nominee directors?
Mr. Wood: I hope I can remember all the right hon. Lady's questions. The question of answerability is dealt with in the fact that the Crown Agents are appointed by the Secretary of State or by myself and therefore they are answerable to us in the final analysis.
I am sorry, but I cannot remember the right hon. Lady's next question.
Mrs. Hart: How is the right hon. Gentleman to be answerable to Parliament for them?
Mr. Wood: I am answerable to Parliament. That is obvious at the moment, when I am being asked so many questions.
Mr. Cunningham: The first time in three years.
Mr. Wood: It is not the first time in three years. I have been bombarded by questions and I have done my best to give as full answers as possible. That deals with the question on answerability.
Perhaps the right hon. Lady will remind me of her other questions. I am afraid that I did not write them down.
Mrs. Hart: There were two other questions. The first was whether trustee shareholdings should exclude speculative property investment, and the other concerned the position of personal shareholdings of nominee directors.
Mr. Wood: On the question of trustee shareholdings, I said that the policy should be carried out "... in accord with the trustee analogy and should be fully consistent with their name and standing."
I think the right hon. Lady would be wrong to get this matter entirely out of perspective. The percentage of the Crown Agents' investment at the present time in property is 1 per cent. and therefore—
Mr. Cunningham: How much money?
Mr. Wood: Not very much. As I was saying, the right hon. Lady is over-estimating the problem.
I made a fairly full statement about the personal holdings of the Crown Agents in the investment companies concerned on a previous occasion, and I do not think I can add to what I said then. On 24 July 1972, the Minister for Overseas Development (Mr Richard Wood) gave the following reply to questions from Sir Bernard Braine and Mrs Judith Hart. He also circulated a written statement reporting on the advice given him by the Stevenson Committee.
Crown Agents (Stevenson Report)
36. Sir Bernard Braine asked the Secretary of State for Foreign and Commonwealth Affairs if he has received the report of the committee, under the chairmanship of Sir Matthew Stevenson, which has been inquiring into the status and functions of the Crown Agents; and if he will make a statement.
37. Mrs. Hart asked the Secretary of State for Foreign and Commonwealth Affairs if he has now received the Stevenson Report on the Crown Agents; and if he will reconsider his decision on its publication, in view of the public importance of the relationship between Her Majesty's Government and the Crown Agents.
Mr. Wood: I have received the committee's advice and with permission I will circulate a statement in the OFFICIAL REPORT. Briefly, the committee found that the interests of the Crown Agents' principals and others concerned would best be served by the continuation of the whole range of services which the Crown Agents provide. I welcome these findings, which reinforce my confidence in the Crown Agents' work for their overseas principals. I also accept the committee's recommendations that there should be a clearly defined status, structure and responsibility for the Crown Agents and that they should bear appropriate liability to taxation. I am considering how these conclusions can best be given effect and I will later make a further statement. I would like to record my gratitude to the committee for its advice. Since most of the Crown Agents' work is for independent Governments, it would not be right to publish the report.
Sir Bernard Braine: Will my right hon. Friend assure the House that the changes he has in mind are in the best interests of the overseas principals? Secondly, bearing in mind the very long and valuable service that the Crown Agents have given their Commonwealth principals over very many years, will my right hon. Friend confirm the impression that a good many of us have had for a long time that the Crown Agents are continuing to serve their principals with skill and integrity?
Mr. Wood: I have every confidence in the integrity of the Crown Agents, and I agree with my hon. Friend about the value of the work they do for their overseas principals. In my opinion the value of that work will be enhanced by changes of the kind I have in mind to make.
Mrs. Hart: Is the right hon. Gentleman aware that when I spoke to him on the telephone last week and he told me that his reply might be too long to give orally, I had no idea that in addition to refusing to publish the report he would issue a statement of the results of the report only in a Written Answer? This is quite disgraceful and it astonishes me. May I put this point to the right hon. Gentleman? Is he aware that in the light of recent discoveries about relationships between civil servants and Governments and between Ministers and Governments following the Poulson investigations, it is irresponsible and inconceivable that a full report should not be published, though not necessarily containing the evidence given by other countries? One can understand that that would not be possible. But is it not irresponsible on behalf of the Government not to publish the findings of this report since they relate to the relationship between employees of the Government and the Government itself?
Mr. Wood: Perhaps I might begin by setting the right hon. Lady's fears at rest about the longer statement that I mean to issue. I assure her that it will contain no surprises. I have summarised it adequately in my shorter answer. As for what she terms the irresponsibility of not publishing the report, I think it would be utterly irresponsible to publish a report which I undertook at the time that I set up the committee would not be published, for reasons that the right hon. Lady knows. What is more, knowing what the right hon. Lady does about the relationship between the Crown Agents and their principals, I am certain that if she were standing at this Dispatch Box she would take the same view. Mr Cunningham
Does the right hon. Gentleman intend to say anything about the fact that Crown Agents' money has gone into the notorious property empire of John Chalk and Timothy Gwyn-Jones? Will he recognise that there is a scandal which is waiting to blow? Unless we investigate the matter fully with sufficient openness but with confidentiality to reflect the circumstances, the traditional work of the Crown Agents, which is of enormous value throughout the world, will inevitably be prejudiced.
Mr. Wood: The purpose of the Crown Agents indulging in the activities to which the hon. Gentleman refers is largely to build up the reserves of the Crown Agents, which are largely to the benefit of the principals themselves, and the principals have shown their confidence in this policy. I understand that the hon. Gentleman has a Question to put to me next week about the appointment of Mr. Challis, but, having made this statement today, I should tell the hon. Gentleman that the Chairman of the Crown Agents, when the appointment was mooted, considered Mr. Challis in the way in which a civil servant would be considered. He consulted me, and I consulted others. I therefore share the responsibility for it. I had no reason to object to this appointment because I believed that it was in line with the rules that apply to the Civil Service.
Mr. Horder: Is my right hon. Friend satisfied that he has the consent and approval of the Crown Agents' principals to these proposals? Would he agree that nothing should be done that could impair the close confidence which the Crown Agents' principals of various Commonwealth countries have in the operation of the Crown Agents' themselves? Would he also accept that the Commonwealth countries are perfectly capable of deciding who should look after their own affairs?
Mr. Wood: I am entirely in agreement with my hon. Friend. I believe that the absence of the principals to these arrangements is of immense importance, and that is the reason why I took the opportunity to tell them what was happening. I believe that my statement will do nothing to damage the confidence that exists between the principals and the Crown Agents.
Mr. Dalyell: In relation to the trustee analogy, may I confirm that the Minister used the phrase "if the companies so decide"? Does this mean that speculative investment can go on without his Department being told?
Mr. Wood: It means purely that the trustee analogy will not be wholly restrictive, that the Crown Agents can make investments, if they so choose, outside the trustee analogy, and would be guided in doing so not only by the executives of the Crown Agents' staff themselves but by the non-executives, who would be appointed after consultation with me.
Mr. Skinner: Would the right hon. Gentleman go even further and issue an instruction to the Crown Agents to stop any investment in these slum property speculations?
Mr. Wood: No, Sir.
Mr. Costain: Does my right hon. Friend see any different relationship between the Crown Agents and Millbank Services?
Mr. Wood: No, Sir. There is no connection.
Mr. Freeson: The Minister gave a scandalous answer to my hon. Friend the Member for Bolsover (Mr. Skinner), who asked whether any instruction would be given by the right hon. Gentleman to the Crown Agents to cease investments in slum property. Is the right hon. Gentleman aware that there is critical concern about activities in this direction? Is he further aware that in such a matter there is a balance of responsibility and confidence between the principals overseas and this House and this country? Surely any decision he takes should reflect that as well? Will he think again about his answer to my hon. Friend?
Mr. Wood: I said, "No" to that question because the Crown Agents have neither made nor contemplated making such investments.
Mr. George Cunningham: Nonsense.
Mr. Wood: I will elucidate. I think the hon. Member for Islington, South-West (Mr. George Cunningham), with his great interest in this matter, has in mind certain investments made in the First National Finance Corporation. This is a company in which the Crown Agents have a limited financial interest. The Crown Agents have not made investments in slum property. There were investments made by the First National Finance Corporation. I have no doubt, and never have had any doubt, about the integrity of the Crown Agents. We can all have our judgment of their judgment. The hon. Gentleman has his judgment about their judgment. The principals also have their judgment about the Crown Agents' judgment and have expressed their confidence clearly.
OVER
CONFIDENTIAL Mrs. Hart: As one who initiated this report towards the end of the period of the Labour Government, I must tell the right hon. Gentleman that I should not take the view he is now taking. I accept that evidence given by other countries should remain confidential but I do not see why that should preclude publication of the conclusions of Sir Matthew Stevenson and his colleagues, and I do not see why the House and the public should be kept in the dark about the reasons why they have come to the conclusions they have.
Mr. Wood: When the committee was set up, with the concurrence of my right hon. Friend, so that the whole relationship between Her Majesty's Government and the Crown Agents could be examined—which, incidentally, impinges on the Crown Agents' relationship with the principals—I undertook that the report would not be published. It is on that basis that the inquiry has taken place. Therefore it would be utterly irresponsible if the report were now to be published.
Following is the statement:
I told Parliament last November that I had appointed a Committee under the chairmanship of Sir Matthew Stevenson to consider the need for any changes in the status, functions and financial operations of the Crown Agents. I now have the committee's advice.
It surveyed all the Crown Agents' activities, which include a very wide range of services on behalf of nearly 300 overseas principals. The committee found that the Crown Agents are providing competent and economical services, of great value to their principals overseas, and that their interests and those of Her Majesty's Government and the remaining British dependencies, are best served by the continuation of this full range of services. I welcome these findings, which reinforce my confidence in the Crown Agents' work for their overseas principals.
The committee, however, commented on the constitutional position of the Crown Agents, and the Government's undefined residual responsibility for them. The committee recommended that there should be a clearly defined status, structure and responsibility for the Crown Agents, and made some suggestions for consideration. The Crown Agents, but not their subsidiary companies, have Crown exemption from taxation. The committee recommended that they should bear an appropriate liability to it. I accept these recommendations and am considering how best they may be given effect. I will later make a further statement.
The main overseas principals have been told of these conclusions, which I believe will further strengthen the Crown Agents in their special relationship of trust with overseas Governments, built up by their long-established activities on behalf of all their principals. I will get in touch with the main overseas principals again as plans develop.
I am extremely grateful to Sir Matthew Stevenson and the members of his committee for their thorough work and wise advice.
Since most of the Crown Agents' work is for independent Governments, it would not, as I made clear in my statement last November, be right to publish the report. On 21 November 1973 the Minister for Overseas Development (Mr Richard Wood) made a further statement announcing the Government's agreement to the establishment of subsidiary companies to deal with financial services, and guidelines for investment policy.
CROWN AGENTS
The Minister for Overseas Development (Mr. Richard Wood): With your permission, Mr. Speaker, and that of the House, I would like to make a further statement on the Crown Agents. In my statement last year, I said that I welcomed the findings of Sir Matthew Stevenson's Committee, that the interests of the Crown Agents' principals and others would best be served by the continuation of the whole range of services which the Crown Agents provide. I also accepted recommendations that the status, structure and responsibility for the Crown Agents should be clearly defined, and that they should bear an appropriate liability to taxation.
The Crown Agents originally came into being primarily to provide certain financial and purchasing services in Britain for countries which were then dependent. The range of their services, conducted on a non-profit making basis and contributing to the development of the countries concerned, has been progressively made available to a large number of countries, most of them now independent. The scope of their activities has also been extended to cover a wide range of technical and financial services.
The Crown Agents have adapted their organisation and structure over the years in order to meet these widening requirements, and in particular have established certain of their services on the basis of fully-owned subsidiary companies staffed by Crown Agents' personnel. In the light of the Stevenson Report, I have agreed that this process should be extended by the establishment of further wholly-owned subsidiary companies to deal with the specialised financial services of the Crown Agents. The boards of management of those companies will include non-executive directors appointed after consultation with me, as well as executive directors drawn from the Crown Agents' staff. The Crown Agents intend that the investment policy pursued by these companies should be generally in accord with the trustee analogy and should be fully consistent with their name and standing. These subsidiary companies will be subject to taxation in the normal way, and arrangements are also being made to bring any profits which may be made by the headquarters' organisation itself within the scope of normal taxation.
The Crown Agents will, as in the past, be appointed by the Secretary of State, or by myself acting on his behalf, for the purpose of carrying out the various services on behalf of the overseas principals. They will thus remain answerable finally to Ministers, but it is neither my intention nor my desire to disturb the traditional practice under which the operations of the Crown Agents on behalf of their overseas principals have been discharged on a basis of non-intervention by Ministers.
In the future, as in the past, the scale and scope of the Crown Agents' operations will depend on the confidence which overseas governments and authorities repose in the organisation. That confidence is fully reflected in the present scale of operations, and I am particularly anxious that the arrangements I have mentioned, which are designed to produce a more readily comprehensible structure and to define the various functions more clearly, should in no way disturb that confidence. I have made this clear to the main overseas principals when I told them the outline of the new arrangements.
Finally, I should once again like to take this opportunity of thanking Sir Matthew Stevenson and his Committee for its report, and of sincerely endorsing the tributes which it paid to the work of the Crown Agents.
Mrs. Hart: I thank the right hon. Gentleman for his statement. As he knows, we have waited for it for a long time. First, I endorse what he said about the confidence which principals may continue to have in the work of the Crown Agents. It is important to say that that is endorsed by both sides of the House.
The Opposition are aware that the present financial operations of the Crown Agents involve them in at least £50 million worth of investment in equities and Mrs Hart
that some of the equities had rather unfortunate results last year. It seems from his statement that he is proposing not to change basically the relationship between himself and the Crown Agents. The right hon. Gentleman will continue to appoint but, as he knows, one of the great problems—this was my opinion when I was his predecessor in office—is that the power to appoint Crown Agents has no corresponding responsibility on the part of the Crown Agents to report to Government. Will there be any change in that respect?
The right hon. Gentleman said that the Crown Agents will remain answerable finally. In what way will they be answerable? Will they report to him? Will the report be published? Will it be available to hon. Members? Will it be subjected to parliamentary questioning?
The right hon. Gentleman says that in the new extended financial operations of the Crown Agents there will be non-executive directors appointed after consultation with him. What precisely will be their non-executive functions? He says that the companies will have to act, will be expected to act or will be intended to act in accord with the trustee analogy. Will he tell us precisely what he means? Does he mean that they are not to have equity shares or equity shares of a speculative character? How does he propose to prevent that happening? Will they no longer invest in property companies?
Depending on the right hon. Gentleman's answers, it may well be that we shall wish to explore the matter in greater depth.
Mr. Wood: The suggestion which I have made to the Chairman of the Crown Agents is that he should be willing—and he agrees—to discuss with me any important developments or changes in the policy of Crown Agents.
The function of non-executive directors will be similar to the functions of such directors of other companies of all kinds—namely, to give advice and to help in the taking of decisions by the companies with which they are connected.
The investment policy pursued by the companies should be carried out in accord with the trustee analogy and should be fully consistent with the Crown Agent's name and standing. That means that they will be guided largely by the trustee analogy but not prevented from making investment outside that analogy if the companies so decide.
Sir Bernard Braine: Is my right hon. Friend aware that his statement will be welcomed by all who recognise the importance of the Crown Agents' work, who have been concerned about critical comment which has recently appeared in the Press? So that we may get the matter into perspective, will he confirm that the success of the Crown Agents' investment policy on behalf of the governments of many developed countries has contributed to those governments placing additional funds and additional orders with Great Britain?
Mr. Wood: I entirely agree with my hon. Friend. The confidence that is shown by the principals in the Crown Agents is unmistakable. I believe that as a result of my statement the principals will take the view that the Crown Agents are strengthened to do the job for the principals which they have been doing and which they will continue to do.
Mr. David Steel: While the right hon. Gentleman's statement may strengthen the Crown Agents, will he answer the question posed by the right hon. Member for Lanark (Mrs. Hart) about parliamentary answerability and the link between the Crown Agents' work and the Minister's role?
Mr. Wood: I do not think that it would be right for discussions between myself and the Crown Agents about the development of their policy to be reported to Parliament. I do not believe that that would be in the interests of the relationship between the Crown Agents and the principals. To an extent that must be a confidential relationship. It would be wrong for such matters to be discussed in Parliament because this relationship between the Crown Agents and the principals would be gravely undermined.
Mr. George Cunningham: Will the right hon. Gentleman acknowledge that nothing in his statement reflects the fact that apart from the operations which the Crown Agents have undertaken on behalf of principals overseas, they have raised on the market £34 million and invested that as they pleased without being answerable to their own chief principals? Will the right hon. Gentleman acknowledge that there will be amazement in the Press and elsewhere that he has made his statement without mentioning that the director of finance of the Crown Agents until a few weeks ago has been appointed the deputy chairman of First National Finance Corporation, a company in which the Crown Agents have an 8½ per cent. ordinary shareholding, 6 per cent. of it being held on behalf of overseas principals? On 31 July 1974 the Minister of Overseas Development (Mrs Judith Hart) announced her intention to appoint a Board of Crown Agents and to give them directions about the conduct of their own-account business.
Mr. George Cunningham asked the Minister of Overseas Development if she will make a statement on the future role and structure of the Crown Agents.
Mrs. Hart: The House will recall that in 1970 I instituted inquiries into the constitutional relationship of the Crown Agents. The right hon. Member for Bridlington (Mr. Wood) took the matter further and appointed the Stevenson Committee. In the light of my own further study, I would like to tell the House what I now propose.
As background, I emphasise that the Crown Agents have a long history of efficient and comprehensive services to countries overseas in the fields of procurement, inspection, engineering, finance and a variety of personnel services. During the nineteenth century and for most of this one they acted essentially for the Colonies who, of course, were, within the responsibility of the Secretary of State. In the last 15-20 years they have acted mainly for independent countries, mostly members of the Commonwealth, and also for the remaining dependent territories. For a historical perspective I recommend the 1909 Report of the House of Commons Committee chaired by Colonel Scely, the Parliamentary Under-Secretary of State (Cd. 4473).
The services they provide are excellent, and are very much appreciated by their overseas principals. They have an efficient and dedicated staff. It is important that their relationship of confidence with their overseas principals remains undisturbed, and that the customary standards of commercial confidentiality will continue to be observed in their transactions. This was the right hon. Gentleman's conclusion, and it is mine also.
Procurement this year is running at the rate of about £160 million annually. Deposits from principals are about £300 million and funds managed on their behalf are valued at about £850 million. These figures give some indication of the scale of the work of Crown Agents. In recent years, as is, I think, well known, they have extended their financial operations on their own account with the objective of building up their reserves. Some of these, particularly those concerned with property, have become the subject of public comment. Given the ultimate responsibility of the Crown Agents to Government, I have therefore decided to make changes in their structure which will not however affect their relationship with overseas principals.
Sir Claude Hayes, who is now and has for some time been the sole Crown Agent, has carried an extremely heavy burden. He would normally have retired earlier this year and I am grateful to him for his willingness to continue in office for a little while longer in order to ease the transition to the new arrangements I now propose.
I am appointing a Board of Crown Agents which will have a full-time chairman and will include up to seven part-time members. I shall announce names shortly.
The board will be required to transmit to me an annual report and accounts which I propose to make available to Parliament. The board will be responsible to me for the organisation and general administration of the Crown Agents' business and I reserve the right to give them directives from time to time.
I shall of course continue the practice of non-intervention in the activities of the Crown Agents on behalf of their overseas principals. In such matters they will continue to act strictly according to the instructions of their principals.
In their own account business I shall direct that the board pays due regard at all times to the best standards of banking prudence and does not engage in transactions which might embarrass Her Majesty's Government or conflict with the interests of its overseas principals. It should not engage directly in the property market, other than in respect of property for its own occupation, any extension in the property field being subject to my prior approval. Of course, I do not intend that existing obligations should be called in question or interfered with.
As the House will appreciate, this is not an easy area in which to achieve the best balance between commercial activities, responsibility to overseas principals, and responsibility to the Minister who appoints the Crown Agents. But I believe that the new structure and guidelines I have outlined will allow the Crown Agents to operate effectively on their own account with a full sense of social responsibility and without in any way disturbing the confidence placed in them by countries overseas, which is so well merited. On 19 December 1974 the Minister of Overseas Development (Mrs Judith Hart) told the House of the Crown Agents' financial difficulties and announced the Government's intention, subject to Parliamentary authority, to provide a recoverable grant of £85 million.
CROWN AGENTS
The Minister of Overseas Development (Mrs. Judith Hart): With permission, I wish to make a statement about the financial position of the Crown Agents.
The House will recall that on 1st July I announced my arrangements for the restructuring of the Crown Agents. There is now a Board of Crown Agents, including up to seven part-time members with a full-time chairman. After discussion with the new chairman I agreed as an interim measure to appoint only three part-time Crown Agents in view of the immediate and pressing problems facing him. While continuing the practice of non-intervention in the activities of the Crown Agents on behalf of their overseas principals, I reserve the right to give the board directives, and indeed have already done so in relation to their own account business.
The new chairman of the Crown Agents, John Cuckney, who took up his appointment on 1st October, appointed Coopers and Lybrand as consulting accountants to review the present financial position and the future financial requirements of the Crown Agents and their subsidiary companies. Morgan Grenfell and Company Limited have since been appointed to advise on general banking matters.
The chairman, supported by the three members newly appointed to his board, has now reported to me that a decline in market value of some of the assets of the Crown Agents has led to an immediate problem of reserves and liquidity. He has made a formal request to the Government for financial assistance.
The requirement is related to the realistic writing down of assets values in the accounts, and to the need to ensure financial backing appropriate to operations involving some £600 million, excluding funds of some £200 million managed for principals.
The Government have agreed to provide £85 million, subject to parliamentary authority, which will be recoverable, by direction, from future earnings or appreciation of assets. Standby facilities have been arranged by the Bank of England.
These arrangements will demonstrate beyond all doubt that the Government stand behind the Crown Agents so that the position of all depositors is fully safeguarded; that the confidence of their overseas principals is fully maintained; and that the important services provided to the principals are continued. In the light of the history of the relationship between Government and the Crown Agents in the last four years, involving, as it has, my own initiatives of inquiries in 1973, followed by the Stevenson Report to my predecessor, the right hon. Member for Woolton (Mr. Wood), which was unpublished, and the inquiries made by a Select Committee of this House, hon. Members will clearly want to know how the circumstances necessitating this financial support have arisen. I have asked the Chairman of the Crown Agents to send me a full report on this, and I shall keep the House informed. Thereafter I shall consider whether any further action is necessary.
I have also asked to be informed in detail of outstanding longer-term commitments of the Crown Agents, including certain property investments in Australia, and of any suggestions which the new board may have for the organisation and management of its financial business in the future. I have reserved the right to direct that monies now being advanced shall be repaid from Crown Agents' resources in the course of any reconstruction of the business.
The House will, I know, appreciate that the present Chairman, John Cuckney, and the three members of his board, John Goble, John Gordon and Leslie Kirkley, have had only a very short time to assess the position and report to the Government. On taking office they were confronted with most difficult circumstances, as the House will clearly understand.
This situation, which I am sorry to report to the House, is one which we are seeking to correct. I am immensely grateful to them and would like to take this opportunity to tell the House that I have complete confidence in them. Their prime concern, as it is mine, and, I am sure, that of the House, too, will be that the Crown Agents, with their long history of service and capability, are able to continue to provide for their overseas principals the full range of their services. Mr. Rippon: I thank the right hon. Lady for making her statement at the earliest opportunity. May I also express a welcome for the Government's determination to maintain full confidence in the Crown Agents? As the statement says that parliamentary authority will be required for the £85 million, does the right hon. Lady expect a debate to take place so that we may have the opportunity of a fuller discussion?
Can the right hon. Lady say a little more about the terms and conditions on which the £85 million is to be provided? In particular, what is meant by the phrase "recoverable, by direction"? It it to be a loan, or a grant, or what?
Not only do I welcome what the right hon. Lady said about a full report being made by the chairman in due course and further statements being made by herself, but I associate the Opposition with what she has said about the confidence which we should have in the new chairman. He has had great experience in public service and outside it, and we fully share the sentiments which the right hon. Lady has expressed about him.
Mrs. Hart: I am grateful to the right hon. and learned Gentleman. As to whether it is a loan or a grant, the position is that the money will be advanced to the Crown Agents but, given the reconstruction of the business that they would contemplate carrying out, there are clearly possibilities that much of it can be recoverable as their assets increase in value or as they make certain changes. Therefore, the position is a little flexible, but we hope that there will be the possibility of recovering some of the money. Nevertheless, it is not precisely a loan, but a grant which we hope will be recoverable. [HON. MEMBERS: "Oh."]
Right hon. and hon. Gentlemen opposite must understand that a situation which has been in the making for at least four or five years is not so easily recoverable by a single stroke of the pen on one day. That is the arrangement we have made, and I think that the right hon. and learned Gentleman will agree that on the whole it is the best arrangement to be arrived at.
The question whether there will be a debate is a matter for the House. I shall be reporting further, and it will be necessary to consider what kind of inquiry should take place. I hope that the House will have a little patience about this because the overseas principals are involved and they, too, will need to be consulted about the form it should take. There is no doubt that the House will be more fully informed and will have a full opportunity to consider the position which has arisen.
Mr. George Cunningham: Will the Minister agree that these enormous difficulties are exactly the difficulties which many of us have been predicting for a long time in the light of the constitutional relationship between the Crown Agents and the Government? This is characterised by at least one hon. Member on the Opposition benches for attack as a phoney campaign. Will my right hon. Friend say roughly how much of the loss sustained on the investment side of the Crown Agents' business is attributable to the fall in the value of shares of First National Finance Corporation, one of whose present deputy chairmen was, immediately before he took up that position, Financial Director of the Crown Agents?
Finally, will my right hon. Friend say whether the Government of the day ever gave to the Crown Agents approval to go into this business of investment by comparison with their traditional buying and selling role, which I am sure continues to have the full support of everyone in the House?
Mrs. Hart: My hon. Friend and I, as I know one or two other hon. Members appreciate, have had a continuing and deep concern about the position of the Crown Agents and their involvement particularly in the money market and the property market. That may not be known to some hon. Members, but it is so, and the Select Committee on Overseas Development gave some consideration to these matters.
I cannot give my hon. Friend a precise answer as to the involvement of a particular company. I can tell him that one of the factors involved, which is not unexpected, is that the Crown Agents had considerable investments in property. The decline in property values over the last year has intensified the problems that might concern any organisation that put a great deal of money into property, and this is a matter which is dealt with in the report which I have had from the Chairman of the Crown Agents. The further report which I shall hope to make available to the House, at least in summary, will show that clearly.
As to the member of the Staff of the Crown Agents to whom my hon. Friend referred, that is a matter which is perhaps better not discussed in the House at the moment, as my hon. Friend will appreciate. If there is an inquiry, whatever form it takes, it might well be a proper subject for the inquiry. Mr. Pardoe: Is the right hon. Lady aware that the House will be somewhat mystified, in that the Government appear to have agreed to provide £85 million but have only now asked for a full report into the circumstances which make this financial support necessary? Does not the Minister think that it might have been better to have asked for the full report first and to have provided the finance thereafter?
Although many will welcome the fact that the Government stand behind the Crown Agents, is the right hon. Lady aware that if this kind of nonsense goes on the world will want to know who stands behind the Government?
Mrs. Hart: I am afraid that the hon. Gentleman is falling rather short of his own standards here. He might be well advised to do a little research into the reports of the proceedings of the House in HANSARD over the last four years. It is all there.
I was the first to express serious concern early in 1970 when I was Minister of Overseas Development. That led to my asking my Department for a paper on the constitutional relationship between the Crown Agents and the Government, which was somewhat obscure. That led my predecessor, the right hon. Member for Bridlington (Mr. Wood) to ask for the Stevenson Inquiry which, reported, but that report despite pressure from the then Opposition, was not published. That led to the Select Committee's inquiries which, as soon as I came back into Office in March, led to my initiating changes in the structure which in turn led to the revelation of what has been going on.
The hon. Member for Cornwall, North (Mr. Pardoe) would do better to do some research.
Sir G. de Freitas: Will my right hon. Friend recognise that many of us who have followed for some time the affairs of the Select Committee and the Crown Agents were highly critical in the past? However that may be, there are many of us now who give full support to the present Crown Agents and their chairman?
Mrs. Hart: I am grateful to my right hon. Friend. I must be absolutely frank with the House. This is an unfortunate report to have to make to the House. It follows a series of events and a history of some years. I think that we are now doing the right thing, and I am certain that the Government's duty is to give full backing to the Crown Agents because of their importance and value and because the name of Britain is involved.
Sir Bernard Braine: Does the right hon. Lady accept that there are some Opposition Members—I was, after all, Chairman of the Select Committee that inquired into this matter—who were anxious about the financial activities of the Crown Agents precisely because they cut across a superb, unique record of service to the Crown Agents' principals in the Commonwealth and to the British economy? I very much welcome, although with some sadness, the statement which the right hon. Lady has made today. May I ask whether at any stage any of the principals have been critical of the conduct of the Crown Agents in the carrying out of their normal business?
Mrs. Hart: The answer to the last part of the question is "No". What emerges is that the matter is not as simple as the right hon. Gentleman might suppose. The answer is "No". The overseas principals still have every confidence in the Crown Agents, and I should like to reinforce what the right hon. Gentleman said. What we are talking about today is the consequence of operations in the money market and the property market which left undisturbed the complete efficiency and good faith of the operations of the Crown Agents in procurement and in service, which are the real bases of their operations. On 23 April 1975 the Minister of Overseas Development (Mrs Judith Hart) made a further report to the House about the Crown Agents' financial position, and announced her decision to set up a Committee of Inquiry under Judge E S Fay QC.
The Minister of Overseas Development (Mrs. Judith Hart): With permission, I wish to make a further statement about Crown Agents.
The House will recall that just before it rose for the Christmas Recess I explained the immediate problems of the Crown Agents' reserves and liquidity which had been reported to me by the new Chairman and board, and announced the Government's agreement to provide immediate support of £85 million and the agreement of the Bank of England to provide standby facilities.
So far the Crown Agents have found no need to draw upon either the £85 million or the standby-facility at the Bank of England to meet liquidity problems. We shall all hope that this will continue to be the case. But the support of the Government stands firm and ready. The grant is there to cover prudent writing down of assets as necessary, and to provide a capital base.
I would also like the House to know of the confidence I have in Mr. John Cuckney, the new Chairman of the Crown Agents, and in his board. In the most difficult circumstances, they are overcoming the problems they faced on appointment with considerable success. Since December, overseas principals have increased the scope and scale of their business with the Crown Agents. Confidence has increased, and it is right that this should be so, for the steady and gradual withdrawal from property investments and secondary banking, according to my directive, is restoring a fundamental financial soundness in their operations.
I have now made further appointments to the board. I have appointed Mr. Harry Hoff, Mr. James Jack and, with effect from 1st July, Mrs. Hester Boothroyd to join Mr. Leslie Kirkley and Mr. John Gordon as members of the board. I have also appointed Mr. John Goble, at present a member of the board, as Deputy Chairman.
I promised to keep the House informed. I can now make an interim report—not yet a final one, for reasons I shall make clear. In doing so, I know the House will understand and appreciate that it concerns not the present but the past.
The chairman has provided me with his board's views on the circumstances which led to the need for financial support, which have been assisted by the investigations carried out by Coopers and Lybrand, the consulting accountants. These are not yet complete. They have had to work on a very large number of transactions made over a long period of time.
The principal factors which the board considers to have contributed to the problems are: first, the operation of a substantial banking business without an adequate capital base; second, over-dependence on the property and secondary banking sectors, and commitment of an unduly large proportion of the total banking resources to a small number of borrowers; third, inadequate controls and procedures for approving and monitoring loans to subsidiary and associated companies, for security for advances, and for the delegation of authority; fourth, lack of outside commercial banking experience among senior staff. These defects of the past are rapidly being remedied.
The Government have reached two major conclusions in the matter. We believe it important and necessary, and the board of the Crown Agents recommends, to arrange for an independent inquiry into past events and the circumstances giving rise to the need for Government support. Accordingly, I have decided to set up a committee of inquiry with the following terms of reference:
"To inquire into the circumstances which led to the Crown Agents requesting financial assistance from the Government."
The inquiry will be conducted by Judge Fay, sitting with Sir Edmund Compton and an accountant. There will, of course, be complete protection of the confidential interests of the overseas principals.
We also propose to give further consideration to the relationship between the Crown Agents and the Government. I shall present a White Paper to the House at a later stage—I hope during this Session—with my detailed proposals, along with the necessary background information about past custom and practice.
Now that I have presented these two major conclusions, I know that hon. Members will wish to join with me in expressing their confidence and support in the present chairman and his board, and in congratulating them on their very great success in the last few months.
Mr. Wood: Does the right hon. Lady recall chiding me, in that gentle way she has, with delay in these matters? Does she recognize that she started these investigations in the 1960s and they now look like going into the late 1970s if, indeed, she is still responsible for conducting them?
In the statement in which the right hon. Lady has announced the setting up of the inquiry has she not to a large extent prejudged the findings of the inquiry? Finally, what powers is the committee of inquiry to have? Amongst other things, will Sir Claude Hayes and others closely concerned have full freedom to state their views in accordance with the recommendations of the Salmon Committee?
Mrs. Hart: I confess that I am a little surprised at the right hon. Gentleman's
As for the right hon. Gentleman's second point, the inquiry will be conducted by Judge Fay, Sir Edmund Compton and an accountant yet to be named. I am sorry that I cannot give the name of the accountant today. We have no reason to suppose that any information requested will not be forthcoming. I am certain, though this is a matter for the inquiry itself, that it will wish to have discussions with all those who have been involved in Crown Agents' matters over the past few years.
Mr. George Cunningham: Will my right hon. Friend accept congratulations on the speedy clean-up job she has done over the past 10 months or so? Will she answer these questions? First, while the inquiry is being conducted, and indeed from now on, can we be sure that the annual reports produced by the Crown Agents will give very full information about the holdings they have, whether directly or indirectly, and the companies with which they have commercial association?
Secondly, am I right in assuming that if the Crown Agents draw upon any part of the £85 million standby cover they will be answerable to the Public Accounts Committee but that they will not be answerable to the Public Accounts Committee otherwise?
Mrs. Hart: I confirm that what my right hon. Friend said in the last part of his question is indeed so. I hope and believe that it will not prove necessary to draw on the £85 million. Indeed, it is very gratifying to be able to say that this has not needed to be drawn on up to now. I hope that that situation will continue. However, should there be drawings, this would be a matter in which the accounting officer of my Department would hold responsibility and it would be a matter for the Public Accounts Committee.
On my hon. Friend's first point, he will know that as from now—I think I have given this information before, and certainly the Crown Agents have—the annual report of the Crown Agents is now, as distinct from past practice, to be submitted to me so that I may make it available to Parliament, and the accounts will similarly be made available to Parliament. The audited accounts for the last possible year—1972—are already in the Library. I think my hon. Friend will find that they give the kind of information that is needed, but I am certain that if this proves not to be the case the Crown Agents or myself would be very responsive to any discussion about what further information they might include.
Mr. Herder: May I echo the confidence in Mr. Cuckney and the efforts that he has so far made? With respect to the inquiry which is about to take place, may we take it that the findings in the Coopers and Lybrand report are temporary findings and are liable to the fullest possible justification by the full judicial inquiry which is to take place later?
On that point, will the right hon. Lady not only allow that inquiry to make the fullest inquiries into all the matters which have occurred in the past but allow Sir Claude Hayes, in giving his evidence, to see the findings which that judicial inquiry may make, unlike the practice in the past in Department of Trade investigations, and allow him to comment on any findings that the inquiry makes before those findings are published?
Mrs. Hart: Obviously, the detailed conduct of the inquiry must be a matter for Judge Fay, who will be leading it, and for the other members of the inquiry. It never has been the practice in the past for a Government, having set up an inquiry, to regulate the precise way in which the inquiry is to be conducted, but I am certain that the inquiry will wish to give every opportunity to all concerned fully to be acquainted with the whole situation and to say whatever they want that is the fairest way of conducting it.
Mr. Skinner: Will my right hon. Friend agree that one of the important reasons why it has been her duty to tell the House, not only on this occasion but on others, too, of the scandalous investments and so on within the area of the Crown Agents is that the Crown Agents wanted the highest rate of return and that usually in this system of ours the highest rate of return can involve investments within the murky and seamy side of life; and the net result was that, like a good many other people who got their fingers burned, they poured their money into property speculation and, indeed, into slum speculation?
Will my right hon. Friend in future insist that investments are of a kind which will not leave her as a Minister to have to come to the House, as the previous Minister did, in order to try to explain away how these investments have been made?
Will my right hon. Friend also see to it that the committee of inquiry will establish quite clearly how much money has been lost as a result of all these investments in these areas of secondary banking, with a particular reference to the amount of money that was lost as a result of the investment in the ill-fated Stonchouse venture? All these matters should be investigated by the committee of inquiry.
Mrs. Winifred Ewing: On a point of order, Mr. Speaker. Is it not the case that today at Question Time, when Scottish Questions were answered, questions which were much shorter in duration than the one which we have just heard were interrupted by your good self as being too long? Can you explain why it is that the hon. Member who has just asked a supplementary question seems to be allowed to ask as long a question as he likes?
Mr. Speaker: I will try to make the position clear. At Question Time the object is to get as many Questions answered as possible. Long supplementary questions cut out other Members' supplementary questions and Questions. After statements, the considerations are not quite the same. It is a matter for Mr. Speaker, my discretion, although I admit I do not often have to complain of excessive brevity on the part of the hon. Member for Bolsover (Mr. Skinner).
Perhaps the right hon. Lady will now answer the hon. Gentleman's question.
Mrs. Hart: My hon. Friend is right in pointing to the fact, which I outlined in my earlier statement in December, that it was the over-investment in property companies and secondary banking, in which there had been a considerable decline in the value of assets, which led to the immediate crisis of liquidity in the Crown Agents. I have given a positive directive that this is now to diminish, and the Crown Agents are now very sensibly withdrawing in a phased way—because it is correct to phase it—from both secondary banking and properties. Since October over £59 million has been withdrawn from property and secondary banking by the Crown Agents.
On the second point about London Capital, I think I made it clear a month or two ago that this is a matter for the commercial judgment of the Crown Agents and that they are acting entirely in accordance with their best and most prudent judgment in this matter. It is not strictly a matter in which I would regard it as proper for me to intervene.
Mr. Stambrook: Does not the experience of the Crown Agents confirm the folly of any Government or quasi-Government Institution using its assets to operate in fields in which it has neither qualifications nor suitability?
Mrs. Hart: What emerges clearly—and I hope we have now corrected the situation—is that if we have a valuable Government institution, which the Crown Agents is—it has the most tremendous ramifications and involvement and an excellent reputation for its procurement policies and all its other activities on behalf of many overseas investments and overseas public corporations—it is of the greatest importance that we have people who are best able to make the right kind of judgments in the operations in which they are involved. I think my own appointments since July have created a board with the expertise and judgment to enable these matters to be correctly administered from now on.
Ordered,
That the draft Recreation (Northern Ireland) Order 1975 be referred to a Standing Committee on Statutory Instruments.
Ordered,
That the draft Double Taxation Relief (Taxes on Income) (Indonesia) Order 1975 be referred to a Standing Committee on Statutory Instruments.
Ordered,
That the Input Tax (Exceptions) (No. 1) Order 1975 (S.I. 1975, No. 624) be referred to a Standing Committee on Statutory Instruments.—[Mr. Edward Short.]
POLICE (AMENDMENT)
3.46 p.m.
Mr. Robert Kilroy-Silk (Ormskirk): I beg to move,
That leave be given to bring in a Bill to make further provision for remedies and complaints against the police.
The Bill will amend Section 49 of the Police Act 1964 which deals with complaints against the police. At the moment, as the House will know, complaints against police officers are investigated by officers from another force. This I believe to be totally unsatisfactory.
My Bill seeks to provide for the introduction of an independent element into the procedure for handling complaints against the police. It is my view—and, indeed, it is a view supported by the present Home Secretary—that an effective and independent element able to command the confidence of the public and the police must be brought into operation while a complaint is being investigated.
I would not regard it as satisfactory to institute merely ex post facto investigations, as many individuals and organisations have advocated, able to act only after the event, in a sense as a form of inquest. The proposed, therefore, is the establishment of independent statutory commissions in each police authority, with members appointed by the Lord Chancellor, who shall be full- or part-time depending upon the experience of the volume of work in their area.
The procedure for handling a complaint is envisaged as follows. A complaint made by a member of the public... On 16 October 1975 the Minister for Overseas Development (Mr Reg Prentice) announced the Government's intention to publish a White Paper setting out their proposals for introducing legislation to incorporate the Crown Agents.
CROWN AGENTS
The Minister for Overseas Development (Mr Reg Prentice): With permission, I wish to make a further statement about the financial position of the Crown Agents and other matters relating to that organisation.
My predecessor announced in December 1974 that the Government had agreed to provide a recoverable grant of £85 million to the Crown Agents to cover the writing down of asset values in their 1974 accounts as then foreseen and to provide financial backing appropriate to their operations, and that standby facilities had also been arranged with the Bank of England.
I have now received the audited accounts for 1973 and 1974 and have placed copies in the Libraries of both Houses. The balance sheet as at 31st December 1974 shows that the Government grant of £85 million was not enough in the event to avoid a technical state of insolvency, with liabilities exceeding assets at that date by some £15 million. This was because a greater degree of writing down of asset values and provision for losses were found necessary for the period covered by the accounts.
I should emphasise that the Crown Agents have no immediate liquidity problems. They have still not needed to draw on the £85 million grant or on the standby facility. I am also reassured by the thorough and energetic action which has already been taken by the new Board of the Crown Agents, under its Chairman, Mr. Cuckney, to clear up the problems of the past and lay the groundwork of a more soundly based future for the organisation. I should like to pay my own tribute to their efforts.
Nevertheless, without Government backing the Crown Agents would at present be in a difficult position, which could affect the confidence of depositors and others. I have therefore thought it desirable formally to reaffirm the assurance given by my predecessor in December 1974, that Her Majesty's Government stand behind the Crown Agents. Hon. Members will find the terms of my assurance to the Chairman in his covering report on the 1974 accounts, and I emphasise now to the House that the Government wish to see the Crown Agents continue in being for the sake of the valuable services which they are able to render both to their many overseas principals in the developing world and to Her Majesty's Government in their relations with overseas countries.
Like my predecessor I am, however, concerned that the future activities of the Crown Agents, and their relations with Ministers, should be on a more closely defined basis. The Government have been giving much thought to the future status, structure and functions of the Crown Agents. We have decided that the right solution will be to introduce legislation which would confer independent legal personality on the Crown Agents by incorporating them, define their functions for the future and provide that specified powers of direction should rest with Ministers.
This would create a well understood relationship of a kind which exists between a number of bodies in the public sector and the Ministers responsible for them. It would clarify the responsibilities of the Government in exercising the broad oversight over the activities of the Crown Agents that has been shown to be desirable by all that has happened, while leaving it to the Board to run their own day-to-day affairs. It would not disturb the traditional relationship between them and their principals.
My predecessor told the House in April that she hoped to publish a White Paper during the present session giving the Government's thinking on these matters. I shall not quite be able to meet that target, but I hope to publish a White Paper shortly to set out our present view of the provisions which will or may be required in the legislation to incorporate the Crown Agents.
Meanwhile, I should inform the House of a further complication arising from the past activities of the Crown Agents which will have to be dealt with separately and in advance of this legislation. I was informed in August by the Chairman that certain loans made by the Crown Agents either directly or through a nominee company might be challenged as unenforceable, on the grounds that the Crown Agents were neither licensed moneylenders under the terms of the Moneylenders Acts nor a bank for the purposes of those Acts. The Crown Agents are advised that if this matter were brought before the courts, they would have a good defence particularly on the basis that they and their staff are exempt from the operation of those Acts as Crown servants. However, if there were a challenge in the courts, the matter might take a long time to resolve. Meanwhile the Crown Agents' financial position might be seriously worsened by the withholding of loan repayments and interest due, and in other ways. Mr. Prentice: The answer to the latter point is, "Yes". I think the answer to the former point would also be, "Yes". It will not have escaped the attention of the House that a great many private enterprise companies—if "enterprise" is the appropriate word—got their fingers pretty severely burned in the property market, and in secondary banking and activities of that kind.
Mrs. Hart: May I welcome very much my right hon. Friend's statement, and particularly the policy that is to be pursued in terms of the future incorporation of the Crown Agents. I am quite certain that that is the right course to pursue.
May I also say that I very much hope that the Fay Committee of inquiry will go very deeply into the causes of the misadventures of the past, which were, as he said, largely concerned with adventures in the property and secondary banking sector.
May I also say to him that I totally share his own confidence in the future of the Crown Agents and in all the tremendous and very difficult work that the new Board and the new chairman have carried out since they were appointed a year ago.
Mr. Prentice: I am grateful to my right hon. Friend for the way in which she has put those points. I think that, in relation to this whole rather tangled story, a tribute should be paid to her, first, for the work she did from the Opposition Front Bench in probing into these matters and persistently questioning the Government of the day, and secondly, for the prompt action she took on assuming office, and particularly the directions she gave to the Crown Agents, which have provided a framework within which they are now working, and which they are fully implementing.
Mr. Tapsell: Arising out of the last part of the right hon. Gentleman's statement, will he give an assurance that the legislation, the introduction of which he is contemplating, will not be retrospective to the extent that it weakens the present legal position of one of the parties to the possible legal controversy to which he referred?
Mr. Prentice: The House will be glad to know that we have in mind a very short Bill which will clarify the position about which there is some doubt. It will not alter the law as most people understand the law but will simply clarify it, so as to avoid the situation which I described in my original statement. If that were not done, there might be a period of uncertainty, which could be most damaging to the Crown Agents and consequently to public funds. Mr. George Cunningham: Will the Minister accept that some of us have almost exhausted our capacity for surprise at the successive manifestations of incompetence which have been shown in running the Crown Agents, and that this shows how unwise it was for the House of Commons Select Committee on Overseas Development just over a year ago to terminate its investigation of the Crown Agents, which might have revealed this latest example of incompetence a bit sooner than it has been revealed?
Are we to understand that there will be two Bills, one the declaratory Bill on the narrow legal point whether there will be two Bills, I envisage as quickly—probably not in the next session as my hon. Friend the Member for Horncastle (Mr. Tapscott). May we have an explicit assurance that the legislation which the right hon. Gentleman contemplates will not retrospectively affect bodies and individuals, persons and partnerships who have been involved in transactions with the Crown Agents and who may even currently be in litigation with them? Some of these involved are themselves in financial difficulties. I understand that one company is in the hands of liquidators. It would be grossly unfair if these matters were clarified retrospectively in a sense unfavourable to these other parties.
Mr. Prentice: I am sure that the House would consider it unfair if the Crown Agents were unable through a legal technicality to recover money owing to them. That is what we seek to clarify and to ensure by this short piece of legislation which I propose to introduce.
Mr. Skinner: Is not the truth of this whole affair that a large sum of money was available for investment and was invested mainly in slum property empire, just like the investments of many private companies, some of which have been referred to already? The fact is that the Crown Agents got their fingers burned as a result of those investments because of the escalation of property values and the subsequent falling-off in values. Are we to take it that this tiny group of people, who have squandered someone else's money and subsequently have had to use large amounts of the British taxpayers' money to try to remain solvent, apparently without success, will be dealt with in accordance with so-called British justice? Will my right hon. Friend assure us that if there are to be bankruptcy proceedings against these people, as there ought to be, they will be dealt with in the same way as the 11 people at Clay Cross about whom my right hon. Friend knows so much—having their cars and furniture taken away because they acted not in accordance with wanting to line their pockets and someone else's but in accordance with high moral principles?
Mr. Prentice: There is a tremendous temptation to debate Clay Cross with my hon. Friend but, unfortunately, that would be out of order. Perhaps we might continue that argument somewhere else. The events which we all deplore are under investigation by Judge Fay and two other distinguished people. I shall await their report, and that report will be made known to the House. Then we can debate these matters. I do not think that any of these proceedings are helped by the cheap stories which are typical of remarks by my hon. Friend the Member for Horncastle (Mr. Skinner). Mr. Costain: Is the Minister aware that the Public Accounts Committee endeavoured to look into these matters in past years but was prevented from doing so because the accounts were not audited by the Comptroller and Auditor-General? Will the new arrangements put the accounts under the authority of the Comptroller and Auditor-General so that the Public Accounts Committee may deal with these matters, or will they be matters for the nationalised industries' accounts?
Mr. Prentice: The accounts which have been placed in the Library today have a commentary by the Comptroller and Auditor-General. Therefore they could be studied by the Public Accounts Committee if it saw fit.
Mr. Lee: My right hon. Friend has made a low-key statement, but is not this a profoundly unsatisfactory state of affairs? Will he reconsider the points made by my hon. Friend the Member for Islington, South and Finsbury (Mr. Cunningham)? Does not this call for a public inquiry under the Public Tribunals Act? Will my right hon. Friend say how much additional money will be required in the interim, since the subvention provided by his predecessor, as he said, clearly proved inadequate? Finally, may I congratulate my right hon. Friend on the fact that his strident assertion to nationalisation is not wholly infeasible?
Mr. Prentice: It is an unsatisfactory state of affairs, of course. My hon. Friend described my statement as "low key". The simple reason is that it is a sequel to two statements to the House by my predecessor which dealt with the matter at a more fundamental level. As to whether there should be a study by a tribunal, there is a study being carried out by Judge Fay helped by Sir Edmund Compton and an accountant, Mr. Peter Godfrey—.
Mr. Lee: But it is not a public inquiry.
Mr. Prentice: This is taking place in private. That was thought right, and it was not challenged in the House when it was first announced. But there will be a public statement about it in due course.
As for the amount of additional money that will be needed, the significant point is that the £85 million of standby facilities at the bank has not been used. What we are saying is that there will be continued Government backing. Whether the money will be used and to what extent it will be needed, we cannot forecast. That depends on many imponderable factors in the future. Certainly I shall keep the House informed of any significant developments.
Mr. Michael Marshall: Although we welcome in general the proposal about the future state of the Crown Agents in their incorporated form, subject to any study of the White Paper, may I ask the right hon. Gentleman to be more clear-cut about allowing freedom in day-to-day management and perhaps, in that context, stress what he omitted to say in his statement that, in addition to serving their overseas principals and the Government themselves, the Crown Agents are serving as a form of direct and invisible exports which are of value to the country? I hope that that side of their activities will be strengthened and encouraged in the future.
Mr. Prentice: The operations of the Crown Agents are of great value to the country in many ways that we cannot measure, because their activities create opportunities which lead indirectly to further investment, exports and so on. The work which they do in training people overseas is of help and of indirect benefit to this country, too.
As for the details of the division of powers between the Minister and the Crown Agents when they are incorporated, I ask the hon. Gentleman to await the White Paper. We are considering that. But we envisage something broadly comparable with the relationship which exists already between many Ministers and the nationalised industries. I am sure that the House would not want a Minister in this House to answer for day-to-day decisions. One difficulty at the moment is that the situation is so unclear in the constitutional sense and needs clarification by new arrangements of this kind.
Mrs. Hart: I am grateful, Mr. Speaker, for being allowed to intervene a second time. Will my right hon. Friend confirm to a number of my hon. Friends, first, that the problem about holding a public inquiry, which was considered very carefully at the time, is that a great deal of the evidence which has to be given to the Fay Committee has to come from companies and banks, is highly confidential and would not have been forthcoming at a public inquiry? Will my right hon. Friend assure them also that those against whom it is possible that charges might be made are under study by the Director of Public Prosecutions? Will he assure them, further, that although a great deal of Government money has been required to sustain confidence in the Crown Agents and to provide standby credits, it has not been spent or needed to be spent?
Mr. Prentice: I think that I can give an affirmative answer to all three of my right hon. Friend's questions. I made reference in my original statement certainly to her latter point about the money not having been drawn upon, and I am glad that my right hon. Friend underlined that. On 29 November 1976 the Minister for Overseas Development (Mr Reg Prentice), in reply to a question from Mr Frank Hooley, announced that token provision had been made in the Winter Supplementary Estimates to cover the liability on Her Majesty's Government arising from the technical insolvency of the Crown Agents.
Mr. Hooley asked the Minister for Overseas Development what provision he has made for the contingent liability of public funds arising out of his assurances of support for the Crown Agents; and if he will make a statement.
Mr. Prentice: Token provision has been made in the Winter Supplementary Estimates to cover the liability on Her Majesty's Government arising from the technical insolvency of the Crown Agents. My predecessor made a statement in the House on 18th December 1974 announcing the Government's support for the Crown Agents, and I reaffirmed this assurance of support on 16th October 1975. The Crown Agents have not so far needed to seek additional financial support from Her Majesty's Government, and the Supplementary Estimates provision is necessary now only as a formal indication of the continuing contingent liability. This overall liability takes account of certain contingent liabilities on the Crown Agents arising from contracts for the supply of British goods and services, including defence equipment, undertaken by one of their wholly-owned subsidiaries, Millbank Technical Services Limited, to which I have given my specific agreement. On 3 May 1977 the Minister for Overseas Development (Mrs Judith Hart), in reply to a question from Mr Denis Skinner, made the following announcement about the management of the Crown Agents' property investments in Australia.
OVERSEAS DEVELOPMENT
Crown Agents
Mr. Skinner asked the Minister of Overseas Development if she will make a statement on the present position with regard to the Crown Agents' investment in Australian property.
Mrs. Hart: My predecessors and I have discussed with the Crown Agents how my directive in 1975 that they should carry out an orderly phased withdrawal from the secondary banking and property fields should be applied to their investments in the Abbey Capital Property Group in Australia. It was clear that the Crown Agents could not be certain of implementing any strategy to this end as minority shareholders in the group, even though they had put up almost all the development finance. They were, therefore, authorised to negotiate with the other interests involved with a view to securing full control of the group. They have now succeeded in obtaining this at a reasonable cost. They have also been able to strengthen their management arrangements for the group, both in Australia and in London.
I have made it clear to the Crown Agents that I shall wish for continuing consultations about the strategy to be followed in conducting the affairs of the group, which must take account of trends in the Australian market. I intend to review with the Crown Agents their policy for the group at regular intervals in the light of market trends, and have asked the Crown Agents for six-monthly reports.
Meanwhile, the Crown Agents have to meet or refinance certain existing obligations in Australia. For this purpose I have agreed that they should borrow up to US $220 million from a consortium of United Kingdom banks, of which US $210 million is to be used in Australia and US $10 million for commitments elsewhere. An agreement to this end has been concluded with my approval. I would stress that this does not mean an expansion of the Crown Agents' interests in Australia, but is required solely to meet existing commitments. CROWN AGENTS: INVESTMENT AND LENDING POLICY
References to the Crown Agents in this paper include their subsidiary companies.
02. The Crown Agents will make any investment of resources belonging to or under the control of their overseas Principals in respect of which they have explicit instructions from those Principals, to whom they will be answerable for those investments.
03. Where they are investing resources belonging to or under the control of their overseas Principals but are exercising their own discretion as to the investments made, or where they are offering advice as to investments to be made under 2. above, the Crown Agents, with a view to protecting their own good name and the position of Ministers from whom they hold their appointment, will take care to avoid transactions which might be likely to embarrass HMG.
04. In all their investment and lending operations in connection with their own account funds the Crown Agents will be guided by the best standards of banking prudence and the normal requirements of the Bank of England and by a similar regard for their own good name and for the position of Ministers. They will equally conduct their operations so as to avoid conflict with, or damage to, the interests of their overseas Principals.
05. In general the financial and banking operations of the Crown Agents are to be directed towards maintaining their reserves at a level suitably related to the overall requirements of their business and to the adequate capitalisation of their subsidiaries.
06. When lending money to other institutions or persons the Crown Agents will do their best, insofar as possible, to acquaint themselves with the full activities of the borrowers and the use to which such money is to be put and will seek to ensure that any loans which they make are employed in accordance with the general considerations in paragraph 4. of this paper.
07. The Crown Agents will not on their own account take a controlling interest in companies, other than those established as wholly-owned subsidiaries to deal with existing business already being undertaken, without prior discussion with the Minister. Any proposed investment of 10% or more in the equity of a quoted company will be subject to prior approval by the Minister.
08. The Crown Agents shall not engage directly in the property market, other than in respect of property for their own occupation or on the explicit instructions of an overseas Principal. Any extension of their own account activities into this field will be subject to prior approval by the Minister.
09. The Crown Agents will carry out an orderly phased withdrawal from the sphere of secondary banking activities.
10. In all transactions, whether on their own account or for Principals, the Crown Agents will, of course, be subject where relevant to the Exchange Control regulations of the Bank of England. On the instructions of the Minister, I am sending you the enclosed guidelines relating to consultation between the Crown Agents and this Ministry over the realisation of the Crown Agents' own-account investments. These should be read as supplementing the earlier Ministerial directive of 3 February 1975.
11. The guidelines have been discussed and agreed with your officials. While they reflect for the most part arrangements which have evolved during the process of consultation over the last two and a half years, they also provide a statement of the principles underlying current practice, and constitute a formal record of the arrangements which the Minister wishes you to follow in future.
12. The arrangements proposed in Sir Richard King's letter of 13 August 1975, and agreed in your reply of 15 August, would appropriately apply to communications made under these guidelines.
(D J Kirkness) GUIDELINES ON CONSULTATION BETWEEN CROWN AGENTS AND ODM OVER REALISATION OF INVESTMENTS
1. Following the Minister's directive to the Crown Agents in February 1975 that they should not engage directly in the property market and should conduct an orderly phased withdrawal from the sphere of secondary banking activities, the assets covered by this directive have been transferred to a separate Realisation Account. It will be the object of the Crown Agents, in consultation with their professional advisers, to dispose of all these assets as rapidly as they can. However, in each case attention will have to be paid to the desirability of securing the maximum financial advantage from such disposals, and also to the need to minimise the risk of further funds being lost, either through fresh commitments or through unreasonable delay in recovering existing investments.
2. It is recognised that the desiderata of early disengagement and maximum return may conflict and that a balance will need to be struck in individual cases between them. In accordance with his general obligation to keep the Minister informed of the development of the Crown Agents' business, the Chairman will make regular reports to the Minister about overall progress in realising the assets in the Realisation Account; and he will consult the Minister before taking a decision on the realisation of any major asset in the Realisation Account (for the purposes of this directive, major assets may be defined as those of which the original cost was more than £5 million) or in any case where special considerations of the kind outlined below apply, irrespective of the value of the investment. In this connection the Minister will need to be informed of, and examine with special care, cases where
i. the Crown Agents consider that the balance of advantage lies in rejecting a course of action which would appear to involve the least financial loss to them on the particular investment in question;
ii. the Crown Agents are for any reason proposing to increase their exposure on a particular investment;
iii. the Crown Agents are proposing to refuse an offer for any investment which is broadly in line with recent valuations or an offer which has the support of their professional advisers, or proposing, for reasons other than strictly commercial ones, to accept an offer which is considerably lower than recent valuations; iv. the Crown Agents are proposing for any reason to make no active efforts for the time being to dispose of an asset;
v. there are wider political considerations to be taken into account;
3. The management of assets in Australia owned by the Abbey Capital Group will be in accordance with the overall policy of the Australian property assets agreed with the Ministry from time to time.
4. The requirement to consult the Minister in the cases defined above is not intended to rule out consultation in other cases where there is substantial uncertainty about the financial or other consequences of a proposed course of action. PROGRESS MADE IN REALISING MAJOR ASSETS IN THE REALISATION ACCOUNT
Note: The order used in listing these assets follows that of the table at paragraph 373 of the Pay Committee Report.
English and Continental Group
The Crown Agents have bought out the interests of most of the shareholders, and now hold a majority interest, giving them control of the Group. They have been pursuing a policy of disposing, to the best possible advantage, of the major remaining assets, a policy directed towards producing the maximum possible recovery of Crown Agents' loans, and thereafter complete disengagement from the Group. The Crown Agents have already recovered a total of £5.8m (most of which comes from the successful sale of the English and Continental Homes site at Warmley, Avon). Despite these recoveries, however, losses on this investment, when they are finally known, are bound to be high - probably in the region of £35m.
Stern Group
On 13 August 1975 the Crown Agents entered into a Scheme of Arrangement with the other creditors of the Stern Group to enable them to recover as much as possible of their loans. Only two properties remain specifically charged to the Crown Agents, and these are expected to realise about £2m. In addition, claims have been submitted under the guarantees given by Mr and Mrs Stern as the formal step necessary prior to the institution of legal proceedings for the recovery of their personal debts. The Crown Agents expect to recover about £4m, out of total loans and investments of some £15m.
Australian Property Investments (Abbey Capital Property Group)
To enable them to choose for themselves the most advantageous possible strategy for their Australian property investments, the Crown Agents have secured control of the companies of the Group. They have strengthened the management, restructured the Board, undertaken a major reconstruction of the Group, and arranged a loan of up to £3210m from a consortium of United Kingdom banks to enable them to meet existing commitments. As a result of these measures the Crown Agents are in a position to control the strategy of disengagement from their investments in Australian property in whichever manner is most advantageous to them, although as explained in para 23 of the White Paper such disengagement will take some considerable time.
**Sterling Industrial Securities**
This Company and its assets have now been sold for £2.36m. Total loans and investments by the Crown Agents in this Company amounted to £12.5m.
**Big City Finance**
Progress is being made in bringing court action by the liquidator and the Crown Agents (through the Attorney General) against the individuals involved. Total loans by the Crown Agents amounted to £1.75m.
**C.I. Bank and Trust International**
This Bank, wholly owned by the Crown Agents, has made substantial losses as a result of property loans. After making full provision of £0.62m against their equity investment, the Crown Agents have now sold this bank to a subsidiary of Charterhouse Limited. The basis of the transaction is that the Crown Agents restore the solvency of the Bank by taking over its bad loans and investments. An associate of the purchaser will attempt to realise these bad loans and investments, but the extent of the Crown Agents' recovery from these is highly uncertain. The provision already mentioned, and a further provision against restoring the solvency of the Bank amounting to £3.96m has been made and these provisions, at present rates of exchange, are expected to be fully adequate to meet the total exposure.
**Old Capital Corporation**
The Company has been in voluntary liquidation since 24 December 1975. Liquidation has been substantially completed, although a number of legal questions remain outstanding. It is expected that the remaining claims by the liquidator will shortly be finalised, thus allowing the winding up of the Company. Full provision has been made against the whole cost of this investment, and associated loans, amounting to £6.3m.
Wallace Brothers and Co (Holdings) Limited
Although a £2m loan outstanding on 31 December 1976 was received in full with interest on the due date, full provision has had to be made against the Crown Agents' equity holding in this Company, at £3.3m. This holding was sold to the Standard and Chartered Bank for a nominal amount, but a deferred consideration may be payable in certain circumstances.
Caribbean Bank
The Crown Agents continue to own half the shares of the Group and are working with their fellow shareholders in difficult trading conditions to safeguard their own interest and those of the Bank's depositors.
Barclays Hotels
The inadequate nature of the charge originally taken on the security prevented the Crown Agents from realising the full ongoing value of the properties. Consequently, on the advice of their professional advisers the Crown Agents sold their debts for £3m, with the net result of a realised loss of £6.5m.
/Triumph Investment Trust and G T Whyte & Co Limited CONFIDENTIAL
Triumph Investment Trust and G T Whyte & Co Limited
These Companies are in liquidation and a receiver is acting for the debenture holder. It is estimated that a total of £3.8m may be recovered, out of total loans of £10m.
Weston Group Limited
The Crown Agents had lent £9m to this Group. Amounts continue to be received from the National Westminster Bank in respect of the Crown Agents' share of the proceeds of the receivership. £1.3m had been received by July 1977.
Richard Square Development Corporation
The Crown Agents had disposed of all their interests in this Corporation by May 1976, making a total loss of £3.5m on an investment of £3.6m.
Insecurities Limited
The inadequate nature of the charge originally taken on the security prevented the Crown Agents from realising the full ongoing value of the properties. Consequently, on the advice of their professional advisers the Crown Agents sold their debts for £2m, with the net result of a realised loss of £3m.
G S Gill Hotels Limited
The Crown Agents' security for their loan of £3m to this Company is a first charge on five properties and a second charge on one other. Two of the five properties have now been sold. It would appear from a valuation carried out in February 1977 that the balance of the debt, after provision of £2m to 31 December 1976, is exceeded by the value of the three remaining properties. Judgement has now been obtained against the guarantors of the loan, and the Chancery Registrar's department perfected judgment on 7 October 1977. The Crown Agents lent £2m to this Company, and have already made provisions of some £1m. As a result of the sale of the underlying security for this debt, the Crown Agents have become involved in litigation with one would-be purchaser of that security, and this litigation has not yet been concluded. RETURN to an Order of the Honourable the House of Commons dated 00 November 1977 for
Report by the Advisory Committee on the Crown Agents (the Stevenson Committee), 24 March 1974
being Annex V to the Statement by Her Majesty's Government on the Report by the Pay Committee of Inquiry on the Crown Agents (House of Commons Return number 000 of 00 November 1977)
Ordered by The House of Commons to be printed 00 November 1977
LONDON HER MAJESTY'S STATIONERY OFFICE 00p net NOTE
A number of passages in this Report are deleted in the published version.
These deletions have been made to protect the confidentiality of the relationship between the Crown Agents and their principals; to safeguard commercial confidentiality; and in one case to avoid the publication of a reference to individuals which might be considered damaging.
The places where deletions have been made are marked with three asterisks, thus: * * * The Minister for Overseas Development
I submit herewith the Report of the Committee.
The Report has been prepared on the basis that it is not for publication. If publication, or circulation outside UK Government circles were proposed, the Report might need a little editing.
The Chairman of the Crown Agents has expressed concern to me about the security of the document and the danger and damage of a leak. The Committee maintained strict security especially in the later stages and all papers have been returned by the members. In regard to the report there are only the original submitted to you and one copy which the Secretary of the Committee holds together with the other papers of the Committee.
A report from Messrs Price Waterhouse on English and Continental Property Co Ltd is awaited but the Committee decided not to delay its Report on that account. Arrangements have been made for the receipt of the Report (Chapter 6.37) and the Committee can be reconvened, if necessary, to consider it. I have agreed with the Chairman of the Crown Agents that he should have a copy of the Price Waterhouse Report.
If the Committee can be of any assistance on matters arising out of its Report the members will, of course, be at your service.
Matthew Stevenson 24 March 1972 11 November 1977
CABINET
DRAFT WHITE PAPER ON "THE CONDUCT OF COMPANY DIRECTORS"
Memorandum by the Secretary of State for Trade
1. I attach a draft White Paper on the Conduct of Company Directors. The White Paper contains proposals to make insider dealing a criminal offence, and deals with a number of weaknesses in the law which have been demonstrated in recent company investigations, particularly in connection with loans to directors and other cases where the private interests of directors may conflict with the interests of the company. Also included are a number of recommendations from the Bullock report relating to the responsibilities of directors, notably the requirement that they should have regard to the interests of employees.
2. The Ministerial Committee on Economic and Industrial Policy (EI) have agreed the content of the White Paper, and the Legislation Committee (LE) have authorised the drafting of the clauses necessary to implement the proposals in the White Paper, although it has not been decided whether the Companies Bill to be introduced early next year will contain any provisions other than those necessary to implement the European Economic Community Second Directive on company law and to increase the fees of the Registry of Business Names.
3. It is widely known, from informal consultations and from an announcement I made in the House of 28 July, that I have been preparing proposals on the subjects covered in the White Paper. If these matters are to be included in the 1978 Companies Bill, then it is necessary to allow reasonable time for public discussion of the detailed proposals before the Bill is published. But if in the event it is decided that pressure of the Parliamentary timetable prevents the implementation of these proposals this Session, it will be better to have published firm and detailed proposals rather than to appear to have abandoned work in these important areas for company law reform.
4. It was agreed at EI that early publication of the White Paper would create a very strong expectation of early legislation. I am prepared to make it clear when the White Paper is published that there may be no time for legislation on its proposals this Session.
5. If my colleagues agree, I propose to publish the White Paper at the end of November.
ED
Department of Trade
11 November 1977 1 The Government announced in a statement by the Secretary of State for Trade to the House of Commons on 28 July 1977 that it was preparing legislative proposals to make insider dealing in securities a criminal offence and to remedy weaknesses in the law which had been demonstrated by recent company investigations, notably in connection with loans to directors and the private interests of directors. This White Paper describes the action which the Government intends to take to improve and strengthen the law on these subjects.
Duties of directors
2 Consideration of all the topics in this paper must begin with the legal responsibilities and duties of company directors. Directors are appointed to act in the interests of the company and an important area of their legal responsibilities derives from trust law - the fiduciary duty to act in the interests of the company. They are also under a duty to exercise care and skill in the discharge of their functions. These duties are part of common law and are not defined in statute. The Government believes that it is desirable to include a general statement of the duties of directors in statute law.
3 For the statutory definition of fiduciary duty the Government will introduce a provision requiring a director to observe the utmost good faith towards his company in all of his actions and to act honestly in the exercise of the powers and in the discharge of the duties of his office. It will also be provided that a director shall not make use of any money or property belonging to his company to benefit himself; nor of any information acquired by him or opportunity afforded to him by virtue of his position as a director of a company, if by doing so he gains an advantage for himself which may conflict with the interests of the company.
4. The standard of skill and care which the law expects of a company director in the performance of his duties derives from case law. He is required to perform his duties with reasonable care, exercising that degree of skill which may reasonably be expected of a person of his knowledge and experience. The law appears to draw a distinction between the standard of skill and the standard of care. For the standard of care, an objective test is set, namely that to be expected of a reasonable man; the standard of skill, on the other hand, is a subjective test under which the level required depends upon the knowledge and experience possessed by each director. The Government has decided that the present requirements of the law should be codified in legislation which will require a director to exercise that degree of care and diligence that a reasonably prudent person would exercise in comparable circumstances and the degree of skill which may reasonably be expected of a person of his knowledge and experience.
5. The Government also believes that employees should be given legal recognition by company law. The statutory definition of the duty of directors will require directors to take into account the interests of employees as well as of shareholders. They will also be required to send the annual report and accounts to all employees as well as to shareholders. This will be an additional financial and administrative burden to companies, but the Government believes that employees as well as
(1) Re City Equitable Fire Insurance Co Ltd [1925] Ch 407 shareholders are entitled to the information in company reports and accounts and that these should be made available to both on an equal footing.
6 The Bullock Committee also recommended that there should be "one place where a director, and particularly the new employee representative, can see a statement of the basic duties he owes to the company as a result of his membership of the board". The Government agrees that it would be useful to bring together in one place a comprehensive statement of the various legal responsibilities of directors, but this would seem more appropriate to a handbook than to the statute itself. The Government intends to consult with the CBI and the TUC about the preparation of such a handbook.
7 The Bullock report also drew attention to the case of Parke v The Daily News Limited in 1962, where the family controlling the company which purchased The Daily News wished to distribute the whole of the purchase price among the employees who would become redundant. A shareholder of The Daily News contested this proposed action and the Court found that there was no lawful basis for it. It is not certain that the requirement which we propose to introduce that directors should take into account the interests of employees as well as of shareholders would be held to extend to the actions of directors in the course of winding up a company, or to former employees. The Government therefore, intends to make it lawful for directors to make provision for employees or former employees when closing down the whole or any part of the business.
(1) Report of the Committee of Inquiry on Industrial Democracy (Cmnd 6706) Chapter 8 paragraph 36 (2) Supra cit Chapter 7 paragraphs 11 and 12 Loans to directors
8 The definition of the fiduciary duty of directors, proposed in paragraph 3, will broadly give statutory form to the existing common law that a director may not make use of his company's money to further his private interests, and loans by companies to their directors are prohibited, with certain important exceptions, by Section 190 of the Companies Act 1948. Nevertheless there have been a number of serious cases where directors have sought to circumvent the law in order to obtain large sums of money from their companies, and inspectors in recent company investigations have recommended that Section 190 should be strengthened.
9 The Government propose to reform the law relating to loans to directors in the following ways:
- For public companies and private companies which belong to a group of which a public company is also a member a) to widen the scope of Section 190 to prohibit, subject to certain exceptions, loans to directors' families and to companies in which a director has an interest as well as loans to directors themselves; and to make breach of these provisions a criminal offence b) to introduce limitations on the scale and terms on which loans to directors to be made when they are permitted under the specific exemptions:
- For all companies: a) to ensure that there is greater disclosure of loans to directors by amending Section 197 of the 1948 Act.
The following paragraphs discuss these proposals in greater detail.
10 Section 190 provides that it shall not be lawful for a company to make a loan, or to enter into a guarantee or provide any security for a loan, to a person who is its director or a director of its holding company. In the case of public companies and private companies that belong to a group of which a public company is also a member it is proposed to extend this prohibition to include a director's spouse, son or daughter, and to prohibit the making of a loan to any company which a director or his family controls or in which he or his family has a major financial interest, defined as 20 per cent or more of any of the classes of capital or of the company's long or medium term loan debts. Loans to trusts of which the director or any member of his family is a trustee, other than a bare trustee, or a beneficiary, will similarly be prohibited.
There are at present three exceptions to the general prohibition on loans to directors: a subsidiary company may make a loan to its holding company where the latter is its director; a company may provide, subject to certain safeguards, funds to a director to meet expenses incurred for the purposes of the company; and finally there is the "banking exemption" which provides that, in the case of a company whose ordinary business includes the lending of money, a loan may be made to a director where such loan is in the ordinary course of the company's business. Alleged abuses of the second and particularly the third exemption have given rise to considerable concern.
It has been suggested that the meaning of "in the ordinary course of business" should be defined more closely. It is however difficult to formulate a definition which would be satisfactory in all circumstances. We therefore propose instead to require that such loans must be on normal commercial terms as to interest rate, repayment terms, security and otherwise; they are to be subject to an overall limit of £50,000 and are to be disclosed in the accounts; and to make a breach of the new provision subject to criminal penalties. It will however be permissible for a director to obtain a low interest loan for house purchase from his company provided that this is done under a scheme which is available to employees of the company and on the same terms; the limit of £50,000 will nevertheless still apply and the loans must be disclosed.
In order not to obstruct legitimate inter-company lending, there will be an exemption to the provisions in paragraphs 10 to 12 above for loans by one company to another within the same group defined as a holding company and its subsidiaries. However where such loans would otherwise have been caught by the rules on prohibition, limitation or disclosure details of the loans must be disclosed separately in the accounts of the Lending Company.
14 The new disclosure provisions to replace those in Section 197 will cover all loans made to directors, including those to their families and associated companies, and will require for each loan:
- a statement of the identity of the borrower, and the name of the director concerned if he is not the borrower
- a statement of the terms of the loan, including interest rate and security
- a statement of the amount outstanding at the beginning and the end of the period, and the highest amount outstanding during the period if this is a higher amount
- a statement as to whether any interest due has not been paid, and whether any provision had been made in the accounts for non-recovery of the loan.
This information will be part of the accounts and will be subject to audit.
15 There are other ways, besides the receipt of a loan, by which a director may become indebted to his company, such as trade credit. It is considered that where such indebtedness is significant it is a matter of legitimate concern to the shareholders, and it is intended that in future companies should be required to show, separately from any loans, the amount of other indebtedness of each director to the company, or his family or associated company, where such indebtedness exceeds £5,000. It is also proposed to limit to £10,000 the advances which can be made by a company to its director to cover expenses.
Directors' conflicts of interest
16 The general fiduciary duty of a director to his company also needs to be strengthened by specific statutory provisions covering transactions, other than loans, in which the director's duty to his company conflicts or may conflict with his private interests or those of his family. In general, it is not possible to lay down in law what directors may or may not do in particular circumstances: the variety of situations is too great. There are, however, two specific types of contract where the possibility of conflict is so clear that the approval of the shareholders should be sought before the contract is valid: one concerns long-term contracts of service, the other significant purchases by the company of assets from or sales to, a director or a company in which the director has an interest. The Stock Exchange listing agreement already provides that, for listed companies, certain of these contracts must be authorised by the shareholders. The Government propose that for all companies directors' service contracts for periods longer than 5 years shall not be valid unless approved by the company in general meeting, and intend to introduce a requirement that significant contracts involving the transfer of assets between a company and a director, his family, or another company in which a director has an interest, shall require the prior approval of the company in general meeting.
17 For other transactions involving possible conflicts of interest it is proposed to provide for fuller disclosure of transactions in the annual accounts of companies, and to strengthen the rights of shareholders to take legal action where they consider that their interests have been harmed by the actions of the directors. The new disclosure provisions will be along similar lines to those already in operation for listed companies, which provide that details of contracts of significance, defined as contracts involving in aggregate more than 1 per cent of the company's purchases or receipts, shall be disclosed. It is considered that this information should be provided in the form of a note to the accounts, rather than in the directors' report, and will therefore be subject to audit.
18 Hitherto, directors who have pursued their private interests at the expense of the company have had little to fear from the shareholders, even when the latter have the necessary information. In private companies in particular, this may be considered as one aspect of the need to improve the position of minority shareholders, and it is intended to introduce legislation to amend Section 210 of the 1948 Act to enable minority shareholders to take action more readily to protect their interests by providing that they may petition the court on the grounds that the affairs of the company are being conducted in a manner unfairly prejudicial to their interests. Such amendment will of course help to deal with a wider range of abuses than those involving contracts in which the directors have a personal interest.
Non-executive directors
19 Non-executive directors can perform a useful function in helping to resolve problems of conflicts of interest as well as in other ways. In recent years there has been growing interest in the role of non-executive directors on company boards. The report of the Company Affairs Committee of the CBI "The Responsibilities of the British Public Company" published in 1973 (the Watkinson Report) concluded that "the inclusion on the board of public companies of non-executive directors is highly desirable .... by virtue of the fact that unlike executive directors they are not closely involved in the day-to-day affairs of the company and they are in a better position to see the company as a whole and to take a critical view of it". Despite this, only 35% of companies in The Times 1000 1975/76 had more than two non-executive directors. Twenty five per cent had none.
20 Non-executive directors can bring to the board a breadth of knowledge and experience which the company's own management may not possess. Even more important, they can increase the element of independence and objectivity in board decision-making. Not being involved in day-to-day management they are able to take a detached look at the way in which the company is being run and at its medium and long term policies. They should provide independent supervision of the company's management. In order to do this effectively, however, the non-executive directors need free access to management information and there need to be enough of them. One or two non-executive directors on a board which is 20 strong are unlikely to exercise real influence.
21 In the United States and Canada a practice has developed in recent years whereby the boards of public companies appoint an audit committee composed wholly or mainly of non-executive directors. The duties of the audit committee are flexible depending on the needs of the company, but the core functions are to review the financial statements and to review the audit arrangements and the company's internal financial controls. The audit committee works closely with the auditors who are normally invited to attend its meetings. It has been found in the United States and Canada that audit committees play a useful role in strengthening the influence of non-executive directors and the position of the auditors. Public companies registered under the Canadian Business Corporations Act 1973 are required to have an audit committee and this will also be a requirement from 1 July 1978 for companies listed on the New York Stock Exchange. The time may come when it will be appropriate to legislate in this field, but the Government believes initially at least it will be better for companies, investors and their representative bodies to work out schemes which can benefit from a degree of flexibility which the law could not provide. It has been found in North America that one of the conditions for the successful operation of audit committees is that the board should contain a sufficient number of strong and independent non-executive directors to serve on them. This means that companies must be willing to allow members of their senior management or directors to serve as non-executive directors on the boards of other companies, to the general advantage of industry. The Consultative Committee of Accountancy Bodies, in a memorandum to the Secretary of State for Trade, has supported experiments with audit committees by UK companies. The Government welcomes this and also the consideration which is currently being given to them by the Confederation of British Industries and the Stock Exchange. Insider dealing
22 Insider dealing is understood broadly to cover situations where a person buys or sells securities when he, but not the other party to the transaction, is in possession of confidential information which affects the value to be placed on those securities. Furthermore the confidential information in question will generally be in his possession because of some connection which he has with the company whose securities are to be dealt in (e.g., he may be a director, employee or professional adviser of that company) or because someone in such a position has provided him, directly or indirectly, with the information. By seeking to make a profit from such information, or to avoid a loss, the individual in question can be held to be taking an unfair advantage of the person with whom he is dealing.
23 There are at present in this country no legal sanctions aimed specifically at discouraging insider dealing although, for example, both the 1967 and the 1976 Companies Acts contain provisions requiring disclosure of dealings by directors and substantial shareholders. In addition, the Stock Exchange regulations and the City Code on Take-overs and Mergers contain provisions against insider dealing and the Stock Exchange has recently announced details of "a model code" which it intends to introduce as part of its Listing Agreement; this lays down principles to be observed by directors and employees wishing to deal in their company's securities. The Government has looked carefully at the issues involved and has paid attention both to what is done in other countries and to the views expressed by various organisations in this country. The question of what should be done about insider dealing has attracted considerable debate here and overseas and this has served to clarify the issues and to identify the conflicting considerations which have to be balanced. That insider dealing is wrong is widely accepted and the Government has concluded that this should be underlined by statutory provisions which would make insider dealing in certain circumstances a criminal offence. It will not be possible to produce a perfect answer to the problem which will enable the immediate identification and conviction of every wrong doer but the Government intends to establish as soon as possible that insider dealing is an offence and to create penalties which will be sufficient in most cases to deter those who are tempted to use inside information for their own personal gain. If the provisions proposed prove insufficient in the light of experience, the Government will not hesitate to modify and refine them.
24 The Government believes that market transactions in quoted securities should be treated differently from other transactions. In the former, with the jobbing system and market structure, it will not generally be practicable to identify a victim who has suffered as a result of insider dealing. It is this that rules out any adequate civil law remedy that would compensate the victim and it is for this reason that the only realistic deterrent is the creation of a criminal offence. In other cases there will be a direct contractual relationship between the parties and it is, therefore, possible to build on existing civil law remedies with some strengthening of the law on fraud and misrepresentation (see para 30). The Government is considering into which category the ARIEL system and the over-the-counter market should fall.
25 The Government's principal proposal is that it shall be a criminal offence for an insider to deal on the market in quoted securities in certain circumstances where he has inside information. We intend, however, that this offence should not be one of absolute liability. The prosecution will need to show that the insider knew or had reasonable grounds to believe that the information was not generally known and was price sensitive and that he dealt nevertheless. Also, it will be possible for a person to offer as a defence that his purpose in dealing was not to make a profit or avoid a loss by the use of his inside information. In making these proposals the Government has recognised that the creation of insider dealing as an offence must not be such as to inhibit dealings which are not under criticism. It has particularly in mind that the directors and employees of a company will not infrequently hold shares in the company for which they work. By the very nature of their employment they will usually be in possession of confidential information and they could be prohibited from dealing perfectly innocently unless their special position was recognised. The difficulty is a real one, but the Government believes that the defence set out in the preceding paragraph will afford a suitable measure of protection in relation to innocent dealings by directors and employees. While the Government welcomes the initiative taken by the Stock Exchange in producing the "model code" referred to in paragraph 23 above, the Government does not consider that it would be practicable or desirable to provide in legislation that compliance with the "model code" should of itself be a defence to the proposed criminal offence. Furthermore, in the Government's view, the wide variety of possible factors to be considered make it impossible to lay down, whether in legislation or in some statutory code, more specific guidance about the circumstances in which, under the provisions set out above, it would be lawful to deal.
In defining an insider it would be possible either to list in the legislation specific classes of persons who together with defined associates would be treated as insiders (principally directors, employees, substantial shareholders and persons with a professional or business relationship with the company) or to adopt a wider approach, as in the United States, that an insider is anyone who has inside information. The principal advantage of the wider approach is that it might avoid some of the anomalies as to who is and who is not within the defined category of insider. However, it would be difficult to enforce in practice and could bring within the prohibition on dealing a much wider range of individuals who would be in some doubt as to whether they were committing a criminal offence by dealing or not. Since this would be unsatisfactory, we think it best to adopt the approach of listing specific classes of persons. However, we intend to adopt a wide definition of associate or "tippee". 28 As to tippee, the Government proposes that anyone who receives information which he knows to be price sensitive and not generally available and which he realises has come directly or indirectly from an insider should fall within this category. It is not proposed to restrict the definition of tippee to those who are in some defined relationship with the insider. The Government recognises that this broad definition may inhibit some transactions but believes that its proposals for a defence against the criminal charge will provide an adequate protection for the innocent. If in a few cases a person is not clear whether he falls within the definition of an insider's tippee, the prudent course will be for him to refrain from dealing. The alternative of setting out in the legislation those who are in defined family or business relationships with the insider would necessarily introduce arbitrary distinctions and could on occasion exclude from the crime persons who were knowingly behaving in an improper manner.
29 It is not proposed that companies themselves should be capable of prosecution for insider dealing. The provisions required to bring companies within the scope of the offence would be very complex and we do not think that by focussing solely on individuals we should be likely to miss any culpable person who should be brought within the net. Also the main aim of the legislation will be to set out in the statute standards by which people can measure their behaviour. However, we would propose to make it an offence for an insider or a tippee to procure dealings by any other person and in this case companies would be included in the definition of person. This provision is necessary to prevent evasion of the legislation by, for example, a person dealing through a company of which he is the major shareholder.
30 Where a market transaction is not involved and there are face to face dealings between vendor and buyer the insider would be put under an obligation, to be enforced by criminal sanctions, to reveal his status to the other party involved in the transaction. Although the latter probably has already sufficient grounds for a civil action where this is not done, we intend to provide specifically that default would give grounds for action to rescind the contract in question and recover any loss caused by the failure to disclose.
31 Where insider dealing takes place in market transactions in quoted securities there are substantial problems in linking buyers and sellers which seem to rule out civil actions by those who claim to have made losses through buying or selling shares at a critical time. Indeed one of the main arguments for creating the criminal offence of insider dealing is precisely that there is usually no effective civil remedy. With the establishment of criminal sanctions criminal penalties will be the natural way of making insiders pay for illicit gains. In addition there would be nothing in the statute which would prevent civil remedies being sought in any suitable case under the present law. The Courts have general power now under the Powers of the Criminal Courts Act 1973 to order a convicted person to pay compensation, and this would apply to convictions for insider dealing. However such an order has to be made in favour of an identified person, and in market transactions it will not normally be possible to identify such a person. There may be some scope for the use of these powers in the more straightforward cases, where the victim is identified and the extent of his loss is clear. It is often argued, however, that it would be wrong to allow the insider to retain the financial benefit of his actions and that the company itself should be allowed to sue for "disgorgement". There will be cases in which the company will already have a right to recover profits obtained from the misuse of information acquired by directors or employees by virtue of their position or which has been entrusted to persons in confidence. To extend the law so as to enable the company to sue for disgorgement where it has no right to do so at present would bring with it a windfall profit resulting from the criminal behaviour of one of its employees but would mean that the insider did not keep any illicit gains. The arguments for and against some provision to ensure that an insider is deprived of such gains are finely balanced and the Government has not yet reached a firm conclusion: further discussion of this subject would be welcome.
32 The preceding paragraphs set out the main principles on which the forthcoming legislation on insider dealing will be based. This legislation will also deal with a number of questions of a more detailed nature, such as the position of trustees and the arrangements within financial institutions for restricting access to the confidential information held by certain departments. These raise important and sometimes difficult issues, and will be the subject of further consideration and consultation. 14 November 1977
CABINET
1978-79 NATIONAL INSURANCE CONTRIBUTION RATES IN RESPECT OF EMPLOYED EARNERS
Memorandum by the Secretary of State for Social Services and the Minister for Social Security
1. We have been unable to reach agreement with the Chief Secretary, Treasury on the Class 1 National Insurance contribution rate to be fixed for April 1978, when the New Pensions Scheme starts. Subject to agreement on this, the other changes in rates (including a reduction in the self- employed rate as endorsed in principle by the Home and Social Affairs Committee) have been agreed with the Treasury and are given in the attached Annex.
2. The present Class 1 rate is 14½ per cent (employer 8½ per cent, employee 5½ per cent). This is bound to go up next April with the start of the new Scheme, and the statutory maximum is 16½ per cent (employer 10 per cent, employee 6½ per cent). We think the increase should be limited to 16 per cent, so that the employee's contribution can be held at 6 per cent.
3. There are strong national insurance reasons for a rate lower than the 16½ per cent maximum. The Government Actuary advises that on given assumptions (an annual earnings increase of 10 per cent, 1,470,000 wholly unemployed (1,650,000 in total) and 9 million contracted out) a 16½ per cent rate would produce overall an income to the National Insurance Fund of £10,941 million. Inevitably the nature of the assumptions makes this a very speculative figure, which could be in error either way. Taking them as the basis of calculation, however, a 16½ per cent rate would produce a deficit of about £33½ million; and 16 per cent would produce a deficit of £402½ million. It would be a departure from the practice of recent years to aim for anything other than a large surplus. But the National Insurance Fund will have a credit balance of about £3,700 million by April next year, and it can well support a deficit of this order.
\*If, for the purposes of the Government Actuary's report on the Contributions Order, the assumed unemployment level is stated to be less than 1.65 million, the size of the deficit would be reduced. Conversely, a higher figure would increase it. 4. For five years the national insurance annual income has been more than was required to pay benefit and administer the scheme: we had surpluses of £600 million and £928 million in the last two years, and expect another £600 million surplus this year. These surpluses have not gone unchallenged, and there have been demands that they be spent in improved benefits. Last year there was in fact pressure to reduce the rate because of the surplus: we resisted this on the ground that we wanted to avoid too big an increase when the new scheme started. With an even higher surplus now we shall at least be expected to moderate the increase.
5. The Government Actuary estimates that after 1978-79 if unemployment fell to, and remained at, 4 per cent, a 16 per cent rate would suffice for over 10 years. For many years we have worked on the principle that we should not look at the finances of the Fund in each year in isolation, but should take one year with another. The confidence of the general public that what they pay in contributions is to provide for benefits will be undermined if we are seen to work only in one way - towards growing surplus. We ought to make use of a very small proportion (£400 million) of the £3,700 million balance in the Fund to tide us over a temporary problem while unemployment remains high.
6. This is of particular importance for April 1978 because of the effect on take home pay at a time when the next stage of Child Benefit will also have an impact. The position is illustrated by the following figures for a man on average earnings with two children:
| Weekly Earnings | Additional to Employee's Contribution | Total Reduction in Take Home Pay (taking account of lost Child Tax Allowances) | Overall Gain in Family Income (taking account of increased Child Benefit) | |-----------------|--------------------------------------|--------------------------------------------------------------------------|--------------------------------------------------------------------------| | £ | £ | £ | £ | | 80 | 0.60 | 0.20 | -1.69 | | | | | -1.29 | | | | | +0.41 | | | | | +0.81 |
To hold the employee's contribution at 16 per cent reduces the impact on his pay by 40p, and increases the total family income, with child benefit, by the same amount. This will particularly help the low paid, who benefit more from a lower National Insurance contribution than from tax cuts costing the same amount; and it could be announced before Christmas. The political advantage of the lower figure will help in our public relations task of selling the new scheme in the coming months.
7. This assumes that the whole benefit of holding the contribution to 16 per cent should be given to the employee. This would leave the employer paying 10 per cent. We should no doubt be criticised for departing from the present relativity between the employer's and employee's contribution and loading it more heavily on the employer (who is already carrying the 2 per cent surcharge) which could be regarded as contrary to an assurance given by the Government spokesman during last Session's proceedings on the Miscellaneous Provisions Bill (Standing Committee A, second sitting, 16 December 1976, Columns 78/9). The Confederation of British Industry and other critics would understand the importance for income restraint of keeping the employee contribution as low as possible.
8. We strongly recommend setting the Class 1 contribution rate at 16 per cent from April 1978, with the employee paying 6 per cent and the employer 10 per cent. We seek the agreement of our colleagues.
Department of Health and Social Security
14 November 1977 OTHER CONTRIBUTION CHANGES
1. The lower and upper earnings limits for Class 1 contributions to be £17.50 and £120 a week respectively.
2. The Class 2 rate to be £1.90 a week.
3. The Class 4 rate to be 5 per cent of annual profits or gains which fall between £2,000 and £6,250.
4. The Class 3 rate to be £1.80 a week.
5. The small earnings exception to be £950 a year.
6. The share fisherman's special Class 2 rate to be £3.00 a week.
7. In their paper (CP(77) 104) the Secretary of State for Social Services and the Minister for Social Security propose that the Class 1 joint contribution rate to be paid from next April by employers and employees contracted into the New Pensions scheme should be 16 per cent (6 per cent employees and 10 per cent employers) rather than the 16 1/2 per cent (6 1/2 per cent employees and 10 per cent employers) which is provided for in the legislation and generally expected to apply. The Government Actuary's calculations show that a 16 1/2 per cent rate would produce a deficit in the National Insurance Fund in 1978-79 of some £33 million; whereas a 16 per cent rate would produce a larger deficit of some £402 million. There would be a similar cost to the Public Sector Borrowing Requirement.
8. The Chancellor of the Exchequer and I think it would be imprudent to go for the lower contribution rate for the following main reasons:
i. People are hoping to see further tax reductions in the 1978 Budget. In particular, the Trades Union Congress will be looking for either further increases in tax thresholds, or a reduced rate band of tax. However, the scope for this will depend on how the economy develops between now and next spring, and in particular on the outcome on pay. The position could well be tight. A sum of over £400 million could be important to a politically viable Budget.
ii. The choice is between helping to make room for tax reductions in the next Budget, and announcing now a smaller increase in national insurance contributions next April than would otherwise have taken place. I have no doubt that the former would have a greater perceived effect on take home pay.
iii. We shall be able to help more low income households through tax reductions than through lower increases in national insurance contributions for those contracted into the new scheme. iv. We should clearly not undermine the basis of the National Insurance Fund. But a 1.6% per cent rate will involve a substantial turn round from surpluses in previous years, including the large surplus expected this year, to a deficit in 1978-79. And there can be no certainty that it will be possible to reduce this rate in the near future. It is wholly defensible, therefore, not to plan for a large deficit this year particularly since the accumulated balance of the Fund will still fall in real value next year measured in terms of the number of weeks of expenditure for which it provides cover, since benefits will be further increased next autumn. The assumptions on which the Government Actuary's calculations are based could, of course, prove wrong. But this could go either way - giving a lower or higher deficit on the Fund. If, for example, earnings increased by more than is assumed, so would unemployment, which would add to the deficit.
CONCLUSION
3. As explained in paragraph 2 ii. above, there is a clear choice between a smaller increase, but still an increase, (a married man on average earnings would pay 40p rather than 60p assuming an equal split between employees and employers) and having nearly £400 million available in the Spring Budget. I believe the difference between these rates is too small to forgo the advantages of having so large a sum available for either income tax reliefs or the other options such a sum would provide. The Chancellor of the Exchequer and I therefore recommend that the joint contribution rate to apply from next April should be set at 16% per cent, divided as to 10 per cent for employers and 6% per cent for employees, as provided for in the present statute.
JB
Treasury Chambers
14 November 1977 CABINET
PAY POLICY AND LOW PAY
Memorandum by the Chancellor of the Exchequer
1. Following discussion of the Secretary of State for Employment's paper (CP(77) 98) I was invited CM(77) 33rd Conclusions, Minute 2) to submit a further paper setting out my own views. This supplements my minute of 7th October to the Prime Minister, which was circulated to Cabinet colleagues.
2. In its discussion, Cabinet concluded that the crucial question would be whether a concession for the lowest paid would help in securing an overall increase not exceeding 10 per cent. For this purpose we took the "lowest paid" as meaning those not earning more than £40 a week. There seem to be two circumstances in which a concession would help:
i. If the Trades Union Congress (TUC) could be persuaded to underwrite the 10 per cent guideline in return, or
ii. if the chief pressure on the policy is from this group of workers.
3. There is no evidence that the TUC will be prepared to underwrite the 10 per cent guideline in any circumstances. The one faint possibility is that if we can maintain it until a majority of workers have settled within it, the TUC can be persuaded to acquiesce grudgingly to it for the remainder of the round in the interests of equity. This stage will probably not be reached until, say, March next year. Moreover, whatever time we choose for renewed talks with the TUC, whether about the remainder of this round or about the arrangements for pay after next July, I suspect that low pay will not play much part given that the TUC has shown little interest in the subject for some time.
4. As regards the chief pressures on the policy, the average earnings of the groups of workers involved in the major challenges to the 10 per cent guideline so far are as follows: Lorry drivers £73.90 British Oxygen £83.20 Air Traffic Control Assistants £76.92 Police Constables £76.33 (outside London) Firemen £74.90 Miners £80.90
As will be seen, none of these groups falls into the "lowest paid" category. A special concession for those earning less than £40 would therefore be of no general assistance in relieving pressure on the policy.
5. The one area in which some conflict has arisen is the limited one of Wages Councils. Wages Councils exist for those sectors of industry in which there are no effective bargaining arrangements. They are often esoteric, like Button Manufacturing or Ostrich Feather, Fancy Feather and Artificial Flower making; but some cover important groups like agricultural workers and Licensed Residential workers. The Councils establish minimum rates for their industries. A number of Wages Councils have recently made proposed awards which breach the 10 per cent guideline, and in each case we have made representations against their proposals.
6. Not all workers in Wages Council industries are actually paid at minimum rates: for example, the Minister of Agriculture, Fisheries and Food recently estimated that over 90 per cent of workers covered by the Agricultural Wages Board are paid above the minimum. The danger in excessive settlements lies in the fact that the awarded percentage increase in minimum rates is normally carried through into the higher rates that are actually paid. The only way to tackle this is to warn employers that they run the risk of discretionary powers being used against them if they do so. The danger remains even if some low pay exception is made to regularise the excessive awards by Wages Councils, and arguably would be made worse in such circumstances because it would be harder to justify the use of discretionary powers when the awards were reflected in increases for workers in the same industry earning more than £40 a week.
7. The tendency to reflect increases at the bottom of the pay structure in higher rates is in my view a strong argument against any exception for the low paid generally. The main effect of such an exception is to jack up the whole earnings structure, which we cannot afford. It also establishes the low paid as a "special case", when we are doing all we can to avoid establishing any.
8. My conclusion is therefore that an exception to the 10 per cent guideline in favour of the low paid would not help us to secure an overall increase in earnings not exceeding 10 per cent, and indeed would probably prevent us from achieving that aim. The only other argument in favour of such an exception would be that it would offer significant relief to family poverty. That argument fails because of the very small proportion of the low paid who are in fact family breadwinners, as shown in the Annex to CP(77) 98, and because fiscal action is in any case a far better way of helping them. I therefore recommend strongly against any exception for the low paid.
D W H
Treasury Chambers
24 November 1977 CABINET
NATIONALISED INDUSTRIAL BOARD MEMBERS' SALARIES
Note by the Lord Privy Seal
1. I attach a memorandum by my officials on this subject.
2. As Minister responsible for these salaries I am in no doubt that the continued postponement of the increases recommended by the Top Salaries Review Body (TSRB) in their sixth report (TSRB 6) is causing great difficulties for the efficient manning of our nationalised industries at board level. The constant pressure on me from sponsor Ministers to bend or break the pay rules in seeking to recruit individuals of the requisite ability shows how far behind the market the current rates have fallen. I hope that my colleagues who are responsible for the nationalised industries will themselves expound the difficulties they are experiencing when this paper is considered.
3. At the same time, I fully accept that at the present crucial stage of the Round 3 pay policy there are very strong arguments against any form of special treatment for such comparatively highly-paid people whatever the justification. And it is unlikely that the situation will be any more favourable later in the round.
4. But we must take our decisions on this problem in full awareness of what we are doing. If we decide that we can do nothing within option a. of the memorandum, then effectively we shall be burying the TSRB 6 which will be overtaken by a new report next April. This is therefore our last opportunity of significantly closing the large gap between the current rates and the market rates by taking advantage of the fact that the TSRB 6 recommendations can be regarded as a pre-policy commitment which would not therefore run foul of the guidelines. If we do nothing the gap between current rates and those likely to emerge from the next TSRB report will be that much larger and there will be no prospect of bridging it in the foreseeable future.
5. We also need to realise that the alternative options b. and c. in the memorandum are simply ways of giving the Nationalised Industrial Board Members' Salaries the guidelines increase which they are no doubt already counting upon. These options do not therefore really help with the problem of TSRB 6 and they will do little either to restore competitiveness or improve morale.
P
Civil Service Department
28 November 1977 PAY OF NATIONALISED INDUSTRY BOARD MEMBERS (NIBMs)
MEMORANDUM BY OFFICIALS
This paper considers possible courses of action to deal with the pay of nationalised industry chairmen and board members (NIBMs), and of the other public sector posts which are linked to it. Annex A describes the present position and how it came about. This annex also includes a table showing the salary rates in payment (with the exception of those of Group C Board Members with which no meaningful general comparison can be made) with details of the increase recommended by the Review Body.
INCOMES POLICY CONSIDERATIONS
2. The increases for NIBMs recommended by the Top Salary Review Board (TSRB) with effect from 1.1.75 (TSRB 6) are large and even if they were staged on the basis adopted for the other groups covered by the Report, would involve additions to current salaries for the generality of under £1000 to about £12000; with an exceptionally high increase of £17,000 for the Chairman of the Post Office and actual reductions in some rates. However, the TSRB 6 recommendations pre-date the three rounds of incomes policy which began in 1975 and could therefore be treated as a pre-policy commitment, ie be implemented outside the current guidelines; and the NIBMs have been told this officially. Obviously however any such payments, however they were justified, would be presentationally harmful to the success of pay policy either now or later in the round. PROBLEMS OF NON-IMPLEMENTATION
3. The out-of-date salaries hinder recruitment of the able people necessary for the efficient running of these industries. Vacancies are hard to fill and standards cannot be sustained. It is increasingly necessary to resort to 'ad hoc' terms - for example to pay starting rates in the upper part of the pay range. This feeds the resentment of existing members and makes expensive problems for the future.
4. None of the other groups covered by the TSRB have been totally denied their recommended 1.1.75 rates. Members resent their treatment by comparison with that given to these other groups, which they regard as discrimination. Some NIBMs and many people in the "consequential" groups earn less than the £13,000 which was allowed in full for other groups. In some cases board member salaries have been overtaken by the first, and even the second tier of officials below them.
5. If no action is taken Board members pensioned in or by analogy with staff schemes who retire during non-implementation will suffer the adverse effects on their pension levels until they die. It is possible to give pensions protection by promulgating increases based on TSRB 6 back to 1.1.75 while deferring actual payment to a current date. The promulgated rate then becomes the pensionable salary.
6. Special problems arise over the NHS consultants and British Nuclear Fuels Limited (BNFL) on which a separate paper is being circulated. Although developments here are relevant they do not in practice materially affect the choice between the options on the general issue. THE OPTIONS
7. The three main possibilities are:
a. The TSRB 6 recommendations could be treated as a commitment predating the 3 rounds of incomes policy since 1975. On this basis part at least of these increases would be implemented at once without formal offence to pay policy. The remaining parts of the report, if any, would then be disregarded; the report would be superseded by the recommendations from the next review (TSRB 10) from 1.4.78. These new recommendations, would, if Ministers so decided, be implemented during the later part of the current round, up to a limit consistent with the current pay policy guidelines.
There are several variants of this option, and these are described in Annex B. This option offers the opportunity of going further in easing problems of recruitment etc., than any of the others, depending on how close it gets to full implementation of the 1974 recommendations. It enables the pension position of retired board members to be improved. Provided the increases are not more generous than those given to the other TSRB groups as Stage 1 of the TSRB 6 recommendations, this option would not raise the question of Stage 2 for these others.
b. Alternatively TSRB 6 could be partially implemented from any convenient date, probably 1 January 1978, within the current pay policy, ie only as far as the guidelines allow. Again several variants exist and some are listed in Annex C. Variant C is designed to pay increases exactly proportional to the salary structure designed by the TSRB, thus preserving the "shape" of their scheme. Although in cash terms the increases would fall substantially short in many cases of even the Stage I increase granted to other groups, option C of Annex C would enable 85% of the TSRB recommended salaries to be paid. Because implementation would depend on the current guidelines, it is very unlikely that any action on TSRB 10 could be taken before January 1979 at the earliest. As with option a. above, the rest of TSRB 6 would be superseded by TSRB 10.
This option, like a., allows a degree of pensions protection for the retired; but since the increase falls well short of even Stage 1 of TSRB 6 and any action on TSRB 10 would be postponed indefinitely, the pensions of those retiring would be reduced in line with the level of salaries. Since this option confines any increase in Round 3 to the maximum allowed by the guidelines it is unlikely to create difficulties for pay policy.
c. The third main possibility is to defer any action until TSRB 10 is available. Implementation of some part of that report, in the light of the guidelines, would lead to results very similar to those under b. above. But the time-scale would be different. The first payment would be made from 1.4.78, and there would be a presumption that further stages of TSRB 10 should wait for another 12 months, i.e. to April 1979.
PENSIONS PROTECTION UNDER THE THREE OPTIONS
8. There are two ways of providing pensions protection (for those already retired) on the basis described in paragraph 5. The actual pay increases agreed could be promulgated as from 1.1.75 (but their payment deferred until a current date); or the TSRB 6 recommendations in full could be promulgated with the payment of anything more than the agreed increase (from a current date) deferred indefinitely. The first course would perhaps be more logical; the second more generous and comparable to the treatment accorded to the other TSRB groups.
9. Both options b. and c. might well be regarded by the NIBMs as nothing more than they could reasonably expect anyway under current pay policy and therefore as in effect a final repudiation of TSRB 6 with no better prospect of any improvement under TSRB 10.
TIMING
10. A decision cannot be long delayed. Apart from the intrinsic urgency of the problem, 1.1.78 is the date on which the NIBMs would be due for a Round 3 increase under the 12 months rule. Moreover, something will have to be said about the Government's intentions in the White Paper replying to the NEDO Report on the Nationalised Industries which specifically raised the pay question. BACKGROUND
In December 1974 the Review Body on Top Salaries (TSRB) made its first substantive report (Report No 6) on the four groups within its remit (Higher Civil Service, Senior Officers of the Armed Forces, the Higher Judiciary and Nationalised Industry Chairmen and Board Members (NIBMs)). The recommended increases for NIBMs were intended to bring them into an appropriate relationship with their counterparts in private industry as from 1 January 1975.
02. The average increase recommended by TSRB for NIBMs was 30%. However, because a fundamental reassessment of the work was carried out individual increases varied widely. For the first and second tier boards, for example, they range from 15% to 50%, and in the special case of the Post Office between 60-73%. For some third tier boards there was a nil or very small increase and for an appreciable proportion of NIBMs neither the salary increase nor the new salary was particularly high.
03. For the other groups covered by the TSRB recommendations increases ranged from 10-50%.
04. In his statement on 20 December 1974 the then Prime Minister recognised that the salary rates recommended by the Review Body were appropriate on the basis they had followed. He announced the acceptance of the recommendations for all groups other than NIBMs, subject to the staging of increases for levels above £13,000 (the second stage to be payable in 1976, though in fact it has not yet been paid).
05. Decisions on the recommendations for NIBMs were postponed pending the report of the Royal Commission on the Distribution of Income and Wealth (RCDIW). Decisions on the consequentials of all the TSRB groups many of whom earn less than £13,000 per annum were also deferred.
06. No action was taken when the report of RCDIW was received and so far Ministers have felt that the general pay climate precludes even partial implementation of the recommendations for NIBMs.
07. The issue has been considered on a number of occasions (including CC(74)50th Meeting, EC(75)10th Meeting, EY(76)14th and 16th Meetings). In March 1977 (EY(77)7th Meeting of 21 March) it was the general view that NIBMs should have a Stage I payment similar to that granted to other groups covered by TSRB 6 recommendations, except that no single increase should exceed £5,000.
08. A target date for payment of 1 August 1977 was adopted, subject to its acceptability in relation to developments in determination of the general policy meanwhile and to TUC views. In the event a firm decision to make payments on that date was not taken.
09. Representations about the situation have come from many informed quarters including sponsor Ministers, the Chairman of the Review Body and past members of public boards. The issue has also been raised in Parliament. In response, concern has been expressed about the present situation and it has been said that the Government hopes to do something as soon as possible.
10. Sir Peter Menzies, when Chairman of the Nationalised Industries Chairmen's Group, submitted a lengthy memorandum to the Prime Minister at his invitation, in January 1977 to which no effective substantive response has been possible. His successor, Sir Denis Rooke is equally pressing in his views.
11. The Chancellor has since told Board Chairmen that it would not be possible to start the current round with a big increase, though he hoped that something could be done before the end of the pay year. He also drew their attention to the phased correction of anomalies which the general policy envisages.
12. The TSRB 6 recommendations have not yet been accepted publicly. Their prior acceptance in whole or in part is a pre-requisite of any improvement on the present position. The NIBMs would no doubt expect at least the same staged treatment as was applied to the other groups. | POST | MIDPOINT OF CURRENT SALARY RANGE | AVERAGE RECOMMENDED INCREASE | |------|---------------------------------|-----------------------------| | | £ | £ | | BNOC | | | | Chairman | 28,350 | 16,650 | | Deputy Chairman | 22,780 | 9,220 | | Board Member | 19,500 | 10,500 | | NRB | | | | Chairman | 31,850 | 13,150 | | Deputy Chairman | 26,000 | 6,500 | | BSC | | | | Chairman | 28,330 | 11,670 | | Deputy Chairman | 24,330 | 6,170 | | Board Member | 19,330 | 5,170 | | FC | | | | Chairman | 23,330 | 16,670 | | Deputy Chairman | 19,330 | 11,170 | | Board Member | 15,330 | 9,170 | | BA, BAC, BCC, BRB, BS, CEGB, EC, & NCB | | | | Chairman, CEGB | 21,330 | 11,670 | | Other Chairman | 23,330 | 11,670 | | Deputy Chairman, CEGB | 18,330 | 6,920 | | Other Deputy Chairman | 19,330 | 7,170 | | Board Member | 15,330 | 4,670 | | SDA | | | | Chairman | 19,000 | 6,000 | | Deputy Chairman | 18,000 | 1,250 | | NRB & NFC | | | | Chairman | 19,830 | 4,170 | | Board Member | 12,330 | 2,170 | | WDA | | | | Chairman | 17,000 | 5,500 | | Chief Executive | 15,750 | 1,500 | | Deputy Chairman | 12,000 | 3,250 | | CDC & UKAEA | | | | Chairman | 19,830 | 2,670 | | Deputy Chairman | 15,830 | 1,420 | | Board Member | 12,330 | 920 | | CAA, C+W, NSHEB & SSEB | | | | Chairman | 15,405 | 7,095 | | Deputy Chairman | 11,280 | 5,970 | | BAA, BTDB & STG | | | | Chairman | 15,405 | 2,595 | | Deputy Chairman | 11,280 | 2,470 | | Area Electricity Boards | | | | Chairman | 15,330 | 4,670 | | Deputy Chairman | 10,830 | 2,920 | | NRB | | | | Chairman | 15,405 | -3,405 | | Deputy Chairman | 11,200 | -2,200 |
Note: 'Current salary range' means the range in payment at 1/1/75 or the corresponding range for Boards established since that time. It does not include the increase of £208.80 paid to NIBMs from 1/1/77 under the second phase of incomes policy since this increase will not be subsumed when TSRB report number 6 is implemented. The main ways of partially implementing the recommendations in TSRB 6 are as follows:
1. to accept the recommendations in full, and to treat NIBMs exactly like the other groups. That would mean promulgating the full recommended increases from 1 January 1975 but making the actual payments in stages, the first stage to be deferred to a date to be selected, with the second stage payable from the same date as other TSRB groups. This would relieve the pension problem and it would minimise the problems arising from the next TSRB review;
2. to accept the recommendations and to implement them in full from a current future date on a staged basis, the first stage to be payable from that date and the second stage when it is granted to other TSRB groups. This would probably be acceptable to most serving NIBMs and it would alleviate the problems over recruitment and retention. It would not relieve the pension problem, and it could leave some problems for the next review;
3. to accept the recommendations and to stage the increases as in 2. above, but with the first stage effective from a current future date and no commitment as to when the second stage is paid. From the time that it was implemented this would represent a move to alleviate current problems and would still result in sizeable current increases, but it would leave NIBMs with a feeling of discrimination against them as compared with other groups. It would not relieve the pensions issue, and it would leave more difficult problems for the next review. This is the course most Ministers favoured in March, though a majority preferred also;
4. to impose a limit of £5,000 on any individual increase. This would have the effect of limiting some of the more spectacular increases (eg in the Post Office) but generally would have the same effect as in 3. above.
5. a further possible refinement on any of the above options would be to limit the initial payment to within an increase of 10%. This could be achieved by any of the methods described in Annex B. The essential difference would be that it would have to be presented as an interim measure which would not preclude a further increase in Round 3 from TSRM 10. It would not lessen the incomes policy difficulties in the options, nor would it make them more acceptable to NIBMs. But it would give the appearance of doing something positive at an early date which did not of itself go further than the current guidelines. ANNEX C
NATIONALISED INDUSTRIES BOARD MEMBERS: POSSIBLE TREATMENT UNDER THE 10% POLICY
The following options illustrate three possible methods of applying the 10% policy to Board members. These are:
Option A: a 10% increase all round. This would actually give some NIBMs a better deal than they would have got with TSRB 6.
Option B: giving each NIBM an increase, from the 10% kitty for the whole group proportional to the original TSRB 6 increases. As these would represent an increase of about 30% on existing salary levels (a very approximate calculation), this means that each would receive ( \\frac{10}{30} ) or about 33% of the TSRB 6 increases.
Option C: bringing the absolute levels of salary as close as possible to TSRB 6 within the constraint of a 10% kitty. This would enable 85% of the original TSRB 6 salaries to be paid; a few would actually receive less than they do at present through this arrangement, notably the Chairman and Deputy Chairman of the British Waterways Board (who are due for a salary decrease under TSRB 6).
2. Special consideration would need to be given to the members of those Boards who were recommended for a net salary cut in the Boyle Report. CABINET
THE 1974 RECOMMENDATIONS OF THE THREE REVIEW BODIES: SECOND STAGE PAYMENTS
Note by the Lord Privy Seal
1. I attach a memorandum by officials on this problem.
2. I agree with the conclusion that the Government cannot voluntarily pay Stage 2 of any of the increases recommended by the various Review Bodies (option ii. in paragraph 8) without creating considerable presentational difficulties for pay policy.
3. If this is accepted the aim must be to concede Stage 2 only in those cases where we are legally obliged to do so. The most difficult case is that of the consultants. Whether we should let them test their case in the courts (option iii.) or concede it at the outset (option i.) depends very much on our judgment of the legal position. In general however I would favour the strongest possible resistance to these claims. But if the consultants manage to get Stage 2 and any others follow it will be increasingly difficult to hold the line, even where the legal entitlement is comparatively weak.
P
Civil Service Department
28 November 1977
1. Ministers decided (before the introduction of the pay policy) to stage the implementation of increases in salary due to certain groups of higher paid staff who were the subject of recommendations by the various Review Bodies (TSRB, DDRB). In all cases, the payment of the second stage was deferred under the terms of the pay policy. This paper considers the implications for these staged payments of the Law Officers' opinion about the contractual right of NHS Consultants to the payment of their second stage, at least from 1 April 1977. It also considers the implications for Nationalised Industries Board Members (NIBMs) for whom no payments have yet been authorised, and for the salaries of Members of Parliament.
Coverage
2. The groups involved are the Higher Civil Service, the Higher Judiciary, Senior Members of the Armed Forces, the Nationalised Industries Board Members all covered by Report No 6 of the Review Body on Top Salaries, NHS Consultants covered by Report No 5 of the Review Body on Doctors' and Dentists' Remuneration; those who have their salaries adjusted consequential upon salary adjustments for these main groups, and Members of Parliament covered by Report No 7 of the Review Body on Top Salaries. The present position of each of these groups is set out at Annex A.
3. Two of the groups whose salary adjustments are consequential upon revisions of the pay of NIBMs are the directors of British Nuclear Fuels Ltd (BNFL) and of the Radio Chemical Centre (TRC). These present separate but related problems. The IPCS, who represent them, claim that the BNFL directors have a contractual right from their terms of appointment to continue a link with Civil Service salaries which they enjoyed as officials before BNFL was formed in 1971. The Attorney General has advised that there is a strong probability that the IPCS would be successful in the legal action which they are threatening. The circumstances of the directors of TRC are identical. If conceded, or determined by the Courts in favour of the IPCS, this claim would give immediate entitlement to what the Higher Civil Service has received from 1 January 1975, and would place these directors in the same position as civil servants in respect of second stage payments, except that their contracts are clearly known to be legally enforceable.
Incomes Policy Considerations
4. This policy requires that the cost of any start made to correct serious anomalies which have arisen during the period of strict pay guidelines should be offset against the 10% earnings limit for settlements. Increases in excess of the guidelines arising from statutory obligations can be paid, and it is also recognised that powers to restrict awards which have contractual force is now limited to breaches in the 12 months' rule.
5. In this case we are dealing with the recommendations for settlement dates before the onset of the pay policy, and with pre-policy commitments announced by the Prime Minister on 20 December 1974 (TSRB) and by the Secretary of State for Social Services on 18 April 1975 (Consultants) which were postponed under the provisions of the Remuneration, Charges and Grants Act 1975. If they cannot be postponed further under the powers vested in the Secretary of State for Employment under this Act, incomes policy considerations do not strictly speaking apply to them.
6. Nevertheless, whatever the technical and legal positions, it is obvious that large cash payments to well paid people in the public sector and outside Round 3 could create a substantial presentational problem. The complex merits of such payments could not be readily explained. This difficulty would be much reduced if it were possible to present these increases as the correction of an anomaly within the current guidelines. But this would mean treating the cases as anomalies arising during the period of strict pay guidelines (which they are not) and preempting money which should be available for pay increases due in the present round. It would not be likely to be acceptable to the groups concerned, especially to those who believe they have a legal right to the money so far withheld. It would effectively postpone any solution of the overall problems, and it would not provide an effective answer if the issue came to court.
The Options
7. As will be seen from Annex A, consideration of the options for dealing with the NHS Consultants in the light of the Law Officers' opinion brings into play a series of complex inter-relationships. Action over the opinion as to the contractual right of the Consultants cannot be long delayed as the Health Departments need to respond to the specific enquiries they have received, to advise the health authorities on their position, and to be ready to answer questions likely to be posed shortly by the Doctors' and Dentists' Review Body. In determining the options, the relationship with present pay policy has to be considered, and it also has to be borne in mind that as far as contractual rights are concerned, these relate to the rights of the individual which are not extinguished by arrangements which may have been accepted by their representatives.
8. The available options therefore seem to be:
i. to concede that the Consultants must be paid their second stage in full from 1 April 1977. This would be in conformity with the Law Officers' view that contractual rights established before 11 July 1975 cannot, under the Secretary of State for Employment's powers under Section 1(5) of the Remuneration, Charges and Grants Act 1975, be held up beyond the normal settlement date in the year beginning 1 August 1976. It would inevitably mean that any other groups who could show that their contractual position was as good as the Consultants would also have to be paid; for example, Judges should they decide to remove their waiver, and perhaps also any consequentials of the Civil Service in fringe bodies who have legally enforceable contracts who were told initially that the second stage payment was due from 1 January 1976 and subsequently that it was postponed under pay policy. There would also be strong pressure for the Government to act similarly for other groups, eg the Civil Service and the Armed Forces whose contractual position is less clear. This in turn could affect the Government's position on NIBMs who have no contractual right to payment but a better case on merits, and it could result in increased pressure on MPs' pay.
ii. to accept that the outstanding commitment to payment of the second stage increases need not be further postponed in Round 3 of the pay policy, and to select a date for payment accordingly. This could be any date after 1 August 1977 but probably most conveniently the first settlement date thereafter, ie 1 April 1978 for the Consultants. This would mean ignoring the Law Officers' advice that a contractual obligation exists from 1 April 1977 to the Consultants. It would not therefore eliminate the risk of legal action by individuals, and it would leave the problem of how to explain the position. Moreover, since this decision would not rest on the need to act to meet the contractual obligation there would be no way of distinguishing between the various groups. This in turn would increase the pressure from NIBMs and possibly from MPs.
iii. to leave the Consultants no option but to test their case at law by suing the health authority. The authority might win, in which case the position would remain unchanged. The probability according to the best legal advice obtainable is, however, that they would lose. If they did the position would be no better than at i. above, except to the extent that the time taken to settle the case might move the effect to a less sensitive time in terms of pay policy. It would be rather worse than ii. because it would publicly expose the weakness of the Round 2 position. The internal repercussions of the legal decision would remain. Moreover, the Secretary of State for Social Services' endeavours to improve relations with the medical world might well be irreparably damaged. There is also a distinct possibility that before the matter reached the courts the BMA and the DDRB would themselves expose the weakness of the Government's stance. Conclusion
09. Considerations of pay policy seem to rule out the "voluntary" implementation of State 2 payments outside the Round 3 guidelines whatever its technical status as a pre-policy commitment. Quite apart from the adverse effect which such large cash increases would have, there would then be no justification for withholding full implementation of the TSRB recommendations for all the other groups as well, including NIBMs and their consequentials who would have to get Stage 1 as well. Even in the context of legal vulnerability this is not really a viable option as it would be likely to create the maximum embarrassment to pay policy.
10. But if Stage 2 has to be conceded to the Consultants on legal grounds, the Government will have to decide whether to concede Stage 2 to the other groups for reasons of equity; or whether pay policy considerations must restrict the concession to those groups who can also establish a legal right to it. But before that situation is reached it will be necessary to decide whether in view of the Law Officers' opinion the Government has no alternative but to give the Consultants' Stage 2 from 1 April 1977 as a legal entitlement without testing the practice in the Courts; or whether there is sufficient element of doubt to justify leaving it to the Consultants to sue the health authorities. The Government will also wish to bear in mind in this context that the position over civil servants legal rights is by no means clear, and that if it is decided to proceed only after action in the courts, the Civil Service unions might pursue their case in this way too (as the IPCS are already known to be contemplating).
11. The position on the two special cases of BNPL and TRC is similar in its legal aspects to that of the Consultants, though it relates to an entitlement, via the Civil Service position, to Stage I payment from 1 January 1975. The decision on this again depends on whether the Law Officers' opinion leaves no alternative but to grant payment of Stage I, or whether there is sufficient doubt to leave the IPCS to sue in the courts. The strength of the legal view appears to be similar to that for the Consultants so the two should move in step. NHS CONSULTANTS
NHS Consultants are in contract with statutory Health Authorities (which are the agents of the Secretaries of State for Social Services for the administration of the National Health Service); which were directed, early in 1976, that in pursuance of the pay policy, the staged payments which were due to be paid from 1 April 1976 were not to be payable from that date. They are entitled to further advice as to what to do, and in particular to know if they are to face a continuing risk of being sued.
2. The Law Officers' opinion is that the NHS Consultants have a contractual right to the payment of their second stage, and that while this right would probably be held to have been lawfully postponed under the first round of pay policy if a determination to that effect were made by the Secretary of State for Employment under section 1(5) of the Remuneration, Charges and Grants Act 1975, there is a substantial risk that legal action to secure payment from 1 April 1977 under the second round of the policy would be successful even in the face of a purported determination that it may be further postponed.
3. The opinion indicates that in the view of the Law Officers the Health Authorities would be in breach of contract if they did not make these payments from 1 April 1977, and that Consultants, if they were to sue, would stand a very good chance of success. This raises the issue whether, in the face of a threat to sue, the Government should allow the legal action to take its course, or should in the light of the legal advice they have obtained accept that payment must be made. It also raises the question of how to deal with direct questions about the statutory basis for non-payment which have now been put by the BMA and an individual Scottish Consultant. The Health Departments have so far avoided a direct answer, saying that the matter of staged payments is under consideration, but they cannot put off an answer for very much longer and would be in an insupportable position if they were to expose the extent of their present knowledge and nevertheless were to force the issue to the courts. The Departments had previously heard that the BMA were considering litigation, and the present enquiries suggest that this consideration continues. At the least health authorities would have to be advised that they might be sued, and this advice could not be given confidentially.
4. Further, the DDRB have, on a number of occasions, expressed the view that the staged payments should be made, but have accepted that this was not possible because of incomes policy. They have asked the Department to provide them with evidence on the effect of incomes policy on the wish that the doctors and dentists have expressed to them that they should immediately reconsider medical and dental salaries. It is highly likely that they will seek an explanation from the Departments of the legal basis for continuing to withhold payment, and will publish the answer. The Departments take the view that they would have if challenged directly on this point to answer the DDRB on the basis of the advice that the Law Officers have given.
THE HIGHER JUDICIARY
5. The Higher Judiciary has a statutory right to payment of the second stage from 26 July 1976. The position is at present protected by voluntary waivers the terms of which (in England) are:
"Notwithstanding that the salary legally payable to me with effect from 26 July 1976 in respect of the judicial office I now hold is [£X] a year, I wish to be paid the salary payable with effect from 26 July 1975 in respect of that office and in respect of any judicial office I may hereafter hold until such time as there is an increase in any of the salaries mentioned in the statement by the Prime Minister on 20 December 1974; and I abandon any claim for payment of money withheld from me in accordance with this wish."
(The terms of the waiver, though not the essential substance, differs in Scotland). Formally the Judges' waivers are already spent through the payment of the supplement of £208.80 earlier this year to all the TSRB groups, including those specifically mentioned in the statement. The Judges have not sought, on the strength of this, to assert their statutory right to Stage 2 increases; but clearly they might consider doing so if the Consultants were to receive such increases while they and the other TSRB groups continued to be denied them. In any event they would certainly no longer regard themselves as bound by the waivers.
THE HIGHER CIVIL SERVICE
6. Although it is generally believed that civil servants do not have enforceable contracts of service, the position is in fact more complex. It is safe to say that this question has never been tested in the courts, but beyond this there is a body of academic opinion which favours the view that there is a contract of employment between the Crown and a civil servant but that it contains an implied term that the Crown may dismiss at will. The Privy Council case of Kodeeswaran v Attorney General of Ceylon is also relevant as indicating that a civil servant might successfully sue for pay accrued. There can therefore be no certainty about the outcome if a legal test case were to be mounted in respect of a civil servant's right to the second stage Payments of the TSRB6 recommendations. These were promulgated in the Civil Service Pay and Conditions of Service Code which carries the force of an instruction under Article 5 of the Civil Service Order in Council 1969 and is mandatory on Departments. As with the Consultants, the subsequent postponements of the Payments have to be viewed in this light.
7. Since senior civil servants are in precisely the same position as Consultants in relation to the second stage payment, it would be invidious to treat them differently. If they were, and Consultants were settled out of court, this would be bound to be seen as the Government giving way to the most vocal and powerful group, and any suggestion that the settlement arose from a different contractual position might simply lead to a test case by civil servants which could have wider undesirable implications. THE ARMED FORCES
8. It is unlikely that a contractual right exists for senior officers of the Armed Forces, but in other respects their position is similar to that of the Civil Service. But there is an added complication in this area that the senior officers feel very strongly about the position of the pay for lower ranks and would find themselves in a difficult position if they were asked to accept second stage payments while the pay problems which exist below (subject to current consideration by AFPRB) are outstanding. Any discrimination against senior officers of the Armed Forces would nevertheless be greatly resented by the Forces generally.
NATIONALISED INDUSTRY BOARD MEMBERS (NIBMs)
09. Although any decisions to implement the Review Body's recommendations would almost certainly lead to a contractual right to payment, the present situation is that the Government has not yet accepted those recommendations and has therefore taken no steps to implement them. No contractual right to payment therefore exists.
10. This does not mean, however, that NIBMs can be ignored. Even though some board members are on much higher salaries, it is hardly feasible that second stage payments could be made to other groups before anything is done for NIBMs. Moreover, to the extent that the position on second stages is being considered for other groups, this is itself a relevant consideration for what might then be done for the NIBMs' group and the two issues cannot easily be separately considered.
MEMBERS OF PARLIAMENT
11. Following the recommendation in Report No 7 of the Top Salaries Review Body, Members of Parliament, by Resolutions of the House, have a "rate for the job" of £8,000 plus the Round 2 increase of £208, though the amount actually in payment is restricted at most to £6,270. (This rate includes the Rounds 1 and 2 increases). No undertakings have been given as to how and when the full rate will be brought into payment. If, however, Stage 2 payments are made elsewhere, whether to meet contractual rights or otherwise, this could have implications for the position on MPs' pay.
CONSEQUENTIALS
12. Any groups whose salaries are indirectly related to the recommendations of the Review Bodies will have to follow what is decided for the main groups. Judicial and Board Member consequentials are at present help up pending a decision on board members' pay. No contractual right to payment can therefore exist for them. "Non-Boyle" consequentials of the Higher Civil Service will have received the first stage payment and will have the expectation of the second stage when it is received by the main group. But a number of these consequentials lie in the fringe body area where there is a strong probability that contractual rights will exist. Such people will be in the same position in law as the Consultants, and any action they might be disposed to take would repercuss on the Civil Service. There is also a strong probability that action would be contemplated, certainly if the Consultants were to take action. The IPCS is already minded that way in the case of the directors of British Nuclear Fuels Limited where they claim there is a contractual entitlement to Higher Civil Service increases and are challenging a decision to apply the same treatment as for NIBMs.
9 November 1977 5 December 1977
CABINET
MILK PRICES
Memorandum by the Secretary of State for Foreign and Commonwealth Affairs
INTRODUCTION
1. As Chairman of the Ministerial Committee on European Questions I seek decisions by the Cabinet on the level of our domestic producer price for milk and certain related issues, on which the Committee has been unable to reach agreement.
PRODUCER PRICE
2. The Minister of Agriculture, Fisheries and Food has proposed a producer price from 1 January to 31 March of 49.2p per gallon compared with an average of 46.5p for the period April-December 1977 and an actual price of 47.75p from September to December 1977. He considers that such an increase is needed for the January-March quarter when costs are at their seasonal peak and production is low, and that this is the minimum price needed to stabilise the size of the national herd which is declining contrary to the Government's declared policy of expansion. Other Ministers saw no justification for a producer price of more than 47.4p which they thought would allow for adequate returns to producers while minimising the increase that would be needed in the retail price (paragraph 4 below). The Committee were however prepared to agree to a compromise price of 48p if the Minister of Agriculture, Fisheries and Food could accept it.
3. Given the Committee's decision on the retail price (paragraph 4 below) an increase in the producer price from 1 January involves an increase in the subsidy payable to meet the Government's outstanding liability of £23 million to distributors. A producer price of 48p involves a subsidy increase of £13.75 million. A producer price of 49.2p involves a subsidy increase of £23 million. The Committee saw no objection in principle to making whatever increase in the subsidy within those limits was needed to finance whatever producer price might be agreed. RETAIL PRICE
4. The Committee agreed to increase the retail price from 11½p to 12½p per pint from 1 January in order to meet rising production and distribution costs provided that it could be announced as applicable (barring exceptional and unforeseen developments) until the end of 1978. It could thus be presented as an increase of less than 10 per cent and as being in accordance with counter-inflation policy. The Committee recognised that a price of 12½p might be overtaken by rising costs in the autumn, but considered that any shortfall should be recouped from a further retail price increase in 1979. Another way of delaying the need for a retail price increase in 1977 would be to increase the subsidy by the full amount of £23 million referred to in paragraph 3 while keeping the producer price below 49.2p. Depending on the level of the producer price between 48p and 49.2p per gallon there would then be an additional sum of up to about £9 million available to meet rising costs (equivalent to the deferment of a 1p increase in the retail price for one month).
5. It now appears that a categorical undertaking to hold the retail price for a year would be inconsistent with the Government's obligation to review it objectively and openly with the distributors in the spring and again in the autumn. But it should be possible to announce our firm aim and intention to hold the price for a year barring exceptional and unforeseen developments; and to achieve this aim in practice.
CONCLUSIONS
6. Cabinet is invited
a. to decide the level of the producer price for milk for January-March 1978 having regard to the proposal of 49.2p put forward by the Minister of Agriculture, Fisheries and Food, the figure of 47.4p favoured by some other Ministers, and the compromise of 48p.
b. To decide whether the subsidy should be increased to an extent corresponding to the level of the producer price, or to a greater extent, but subject to a limit of £23 million, for the sake of greater flexibility in the handling of the next retail price increase.
c. To agree that the announcement of the retail price of 12½p should be made along the lines suggested in paragraph 5.
DALO
Foreign and Commonwealth Office
5 December 1977 CABINET
THE NEW PENSIONS SCHEME
Memorandum by the Secretary of State for Social Services and the Minister for Social Security
1. It seems to us, after consultation with the Prime Minister, that it may be helpful to Cabinet to have a note of the main features of the new pensions scheme which is to come into force next year. The planning of the scheme was undertaken immediately after we took office in March 1974, and it was first put forward in the White Paper "Better Pensions" in September of that year. Legislation followed in the Social Security Pensions Act 1975. That Act received all-Party support in its passage through Parliament and brought to an end a 20-year wrangle over the future of pensions.
2. Contributors to the new scheme will qualify for a basic pension on the lines of the present flat rate and also for earnings-related "additional pension". This additional pension will build up to its full level in return for 20 years' contributions after 1978: a married man on average earnings will then have a total pension entitlement - basic and additional together - of considerably more than half pay. The scheme will cover invalidity and widowhood as well as retirement; it will entitle a woman to the same personal pension as a man with the same earnings, and it will make special provision for those, men and women alike, who have to give up work because of responsibility at home. It will be fully protected against inflation. And it will eventually give especial help to people with fluctuating earnings (that is, in practice, to manual workers in particular) by basing their pensions on their best 20 years of earnings after 1978.
3. The development of a state pension related to earnings will, rather belatedly, bring Britain into line with the European Economic Community (EEC) generally and with other advanced industrialised countries: by the end of the century our pensions will bear comparison with those payable anywhere in the world. However the scheme we are adopting is unique in that it makes provision for contracting out, and therefore does not divert resources into making duplicate provision for people who are already covered by good occupational schemes. The partnership which has been forged between state and private pensions is perhaps the main reason why informed opinion generally welcomes and supports the new scheme.
4. The Annex to this paper
i. explains the new pension arrangements in greater detail;
ii. draws attention to certain issues on which there may be some public debate in the coming months - in particular the position of existing pensioners; and
iii. sets out the steps which are being taken to publicise the new scheme before it takes effect in April. In addition to Departmental publicity, 17 Labour Party regional conferences have been arranged between February and April to discuss the new scheme. We shall undertake the bulk of these Party engagements between us; Barbara Castle and Eric Deakins will also be involved. The Trades Union Congress (TUC) who will have a large delegation at the launching conference in January, will actively encourage constituent unions to send members to the Labour Party Conferences. We regard this educational programme, both in the Party and the country, as being of extreme importance and of offering scope for real political gain. The publicity will emphasise that the scheme represents the first major pension reform undertaken in this country since Beveridge, and is accordingly something of which the Government can be proud. Any willingness on colleagues' part to devote time in public speeches to giving the widest possible publicity to the new pensions scheme will be greatly welcome.
D E S O
Department of Health and Social Security
6 December 1977 ANNEX: THE NEW SCHEME IN DETAIL
1. In April 1978 people in employment will begin to contribute towards the Government's new earnings-related scheme, and will start to build up title to a pension in two parts, known as the basic and the additional pension.
BASIC PENSION
2. The basic pension will be virtually the same as the present flat-rate national insurance pension. The April 1978 level (£17.50 a week for a single person and £28 for a married couple) will be that of the present standard rate of pension and, as a minimum, it will be up-rated each year in line with the movement of earnings or of prices, whichever has risen the faster. It will be open to Government, as it is now, to raise the pension faster than the indices warrant or more frequently than annually, if this can be afforded.
3. There will however be two important changes in the rules of entitlement, both of particular interest to women. First, the "half-test", which is a special condition which a married woman has to satisfy before she can qualify for a pension on her own contributions, will be abolished. Secondly a person whose absence from the employment field has been due to "home responsibility" (broadly, responsibility for a child under the age of 16 or the need to care for a recipient of attendance allowance) will in future be able to qualify for a full pension from contributions in fewer years than are required at present, although a minimum of 20 years' contributions will still be needed.
ADDITIONAL PENSION
4. The new scheme's major innovation is its introduction of the earnings-related additional pension. This has the following features:
(1) It will be earned by the payment of contributions as an employed person on earnings between the level of the basic pension and an upper limit (about 7 times the basic pension) beyond which no further contributions are payable. In 1978/79 this will mean earnings between £17.50 and £120 per week. (ii) The pension will represent 1/80th of such earnings for each year of contributions under the new scheme. Thus a person who contributes for just one year before his retirement and who earns £75 a week will earn an additional pension of 72p per week (ie 1/80th of £75 minus £17.50) by his year's contributions and this will be payable in addition to his basic pension. The amount which will be earned by someone who contributes at the maximum level of earnings (£120 a week or more) during 1978/79 will be £1.28. Women will earn the same pensions as men with the same earnings.
(iii) After 20 years of contributions additional pension will amount to 1/20 (20/80ths) of earnings above the basic level in those years. Thus, in today's money, the employee who has contributed steadily on earnings of £75 a week will qualify for additional pension of £14.38 a week, giving him a total pension entitlement of £31.88 if single or £42.38 if married. (These amounts represent about 42½% - single - or 56½% - married - of his earnings.) The person who contributed on maximum earnings for 20 years would qualify for additional pension of £25.60 a week on top of his basic pension.
(iv) After the new scheme has operated for 20 years the formula for pension will remain at 1/20 of earnings but the earnings taken into account will be those in the contributor's best 20 years. This aspect of the new scheme will particularly favour manual workers whose peak earnings do not come immediately before retirement but early in life.
(v) Before pension is calculated, earnings will be revalued. Earnings in each year of working life will be raised in line with the increase which has taken place in earnings generally since that time. Thus additional pensions will be based on earnings but will also reflect the rise which has occurred in the general standard of living. (vi) Once it is in payment additional pension will be increased each year at least in line with prices. From next year onwards price-protection will also be extended to the graduated pensions which many contributors earned between 1961 and 1975.
(vii) The two-tier formula of basic plus additional pension will apply not only in retirement but also to the benefits payable in the event of invalidity and widowhood. In the case of a widow of working age it will be her late husband's earnings, not her own, which are taken into account.
(viii) A widow who has retired may be entitled to additional pension on the basis of her own contributions as well as her husband's. If so, she may draw both pensions, subject to the proviso that she would not receive more than would be payable to a single person who had contributed to the scheme on maximum earnings since its inception. A man whose wife dies when both he and she are over pension age will also be entitled to draw the additional pension for which they have both contributed, subject to the same maximum.
CONTRACTING OUT
5. There will be provision for contracting out of a part of the state arrangements, but to do so an occupational scheme will have to provide its members with pensions at least at the level of the new additional pension. In such a case the scheme members will pay a reduced contribution and will qualify only for the state basic pension. After they have retired, however, the state will undertake the inflation-proofing of that part of their occupational pension which is being paid as a substitute for the state additional pension.
THE SELF-EMPLOYED
6. There is no provision, as yet, for the inclusion of the self-employed in the new scheme. However, from 1978/79 onwards the amount they pay will be determined in the same way as the contributions of employees who are contracted out of the additional pension, and their contribution liability will therefore be reduced, broadly from 8% to 5% of their earnings, as from April.
POTENTIAL PROBLEMS
(i) The demand for "crediting-in" existing pensioners
7. The 1974 White Paper "Better Pensions" acknowledged that a new earnings-related scheme would not normally operate retrospectively to cover those who had not contributed to it, but said that "With the introduction of the new scheme, the position of existing pensioners will be further reviewed in the light of the development of the economy." Since then the possibility has been explored of a system whereby existing pensioners would be credited-in to the new scheme by becoming entitled to an additional pension at a minimum level; the same minimum would be available to people retiring after 1978 whose contributions had earned them only a small additional pension or none. However, even a very modest scheme on these lines offering a supplement of £1 a week to the basic pension would incur very substantial extra expenditure - more than £300 million in the first year - for which no provision has been made.
8. In view of the cost, we cannot at this stage recommend crediting-in as an option to be pursued. But there could well be a strong campaign - from the "poverty lobby", representatives of pensioners and from our own supporters - in favour of crediting-in or, at least, urging us that some special measures should be undertaken to help existing pensioners in order to compensate them for their exclusion from the new scheme. The strength of such a campaign, and whether it will make some concession essential if damage is to be avoided to the whole concept of the new scheme, are matters which we cannot gauge before the publicity build-up for the scheme begins early in the new year. However, decisions about possible extra expenditure on existing pensioners, whether associated with the November 1978 up-rating or operating from April 1979 (when the first additional pensions become payable to new-scheme contributors) need not be taken before the spring. For the time being, therefore, we suggest that questions about existing pensioners should be answered in part by reference to the Government's excellent record on pensions since 1974, and our success in protecting social security beneficiaries from the effects of economic crisis and public expenditure cuts, and partly by a reiteration of our 1974 pledge that, when the new scheme is introduced, their position will be further reviewed.
(ii) Contribution Changes
09. From April 1978 employees who are contracted-out, the self-employed and the few voluntary contributors will all pay less than they do now for the same pension. For employees fully within the state scheme, however, there will be a contribution increase; for men with families this will come at a time when a reduction in child tax allowances, linked to the phasing in of the child benefit scheme, may also mean a reduction in take-home pay. The national insurance increases can however be justified as a very reasonable premium for the benefits they will earn. The new contribution level will be 6½% of earnings and this will involve employees in paying 2½% more than at present. But the additional pension accruing each year in return - 1½% of earnings above the lower limit of (in current terms) £17.50 a week - will be much larger than the contribution increase.
10. There may be some additional criticism on behalf of those people who will reach pension age before April 1979, since they will earn no additional pension from their months of contributions to the new scheme. It is however inherent in the task of keeping the new arrangements reasonably comprehensible that benefits under them must accrue in whole tax years, so that the contributions paid in the part-year before retirement earn no specific addition to pension rights. This is already the position under the flat-rate national insurance scheme. (iii) Arrangements for contracting-out
11. In spite of widespread publicity aimed at employers, it seems likely that delays on their part in applying to the Occupational Pensions Board for contracting-out certificates may well lead to a rush of such applications immediately before 6 April, and therefore to some administrative inconvenience and delays. The Occupational Pensions Board are fully aware of this possibility, and Regulations have been made to enable them to streamline their procedures in issuing contracting-out certificates on an interim basis. Further Regulations will be made before Christmas allowing employers and employees to pay the lower (contracted-out) rate contributions for a few weeks from 6 April pending receipt of their contracting-out certificates.
(iv) Complexity of the New Scheme
12. The benefit formula of the new scheme is simpler than that of the Crossman scheme and no more complex than those of earnings-related schemes abroad. Nevertheless it is not easy to explain in the way that a flat-rate pension increase would be. Any scheme which aims to reconcile the differing social aims of relating pensions to earnings, enabling past earnings to retain their value, benefiting low earners proportionately more than the higher-paid, and protecting pensions in payment against inflation is bound to be complicated, quite apart from the constraints imposed by a system of contracting-out and the need for the rules for the new additional pension to be consistent with those which already govern flat-rate entitlement.
13. Once the new scheme has begun, therefore, it may often be difficult for the individual pensioner to see how his particular benefit is calculated in terms of basic pension, additional pension and graduated pension, especially if he has been contracted-out and if such features as an increase in his pension because of deferred retirement come into the reckoning. Moreover, since the pension will reflect his individual record of earnings, a local office will not normally be able to answer his detailed questions about it without obtaining information which is held centrally on computer. To date there has been some criticism of the quality of the general advice being given about the new scheme by our local offices: but the training of local staff has been under way for some time and is being intensified. They should therefore be able to deal adequately with public enquiries by the time that these arise in any numbers.
PUBLICITY FOR THE NEW SCHEME
14. The Government's immediate task is to give sufficient publicity to the new scheme to make it clear to those who will pay higher contributions from next April that these are the passport to a very significant increase in benefit rights. Previous pension schemes, from the graduated arrangements onwards, have not excited any marked degree of public interest but we are determined that the latest reform should be recognised for the advance that it is. As a first step, the Department of Health and Social Security is organising a one-day conference to launch the scheme on 25 January 1978; a large audience of interested parties including MPs, TUC, CBI and many other pensions interests will be invited.
15. The January conference will be the occasion at which we shall bring out a series of leaflets on new pensions, including a popular one-page summary of the scheme as well as detailed material about it. The conference will be followed in February and March by an extensive Governmental advertising campaign aimed at bringing the salient features of the new scheme to the attention of the general public. Speaking briefs and other material on the scheme will also be made available to Government spokesmen and to MPs of all parties.
16. As already explained in the paper, we will also be undertaking 17 Labour Party regional conferences. CABINET
TOP SALARIES - NATIONAL HEALTH SERVICE CONSULTANTS AND OTHERS
Memorandum by the Attorney General
1. This item was not reached in Cabinet on 1 December 1977, and it raises some complex legal points. I think that it would be helpful to my colleagues to record my views in writing.
A. BRITISH NUCLEAR FUELS LIMITED DIRECTORS
2. In CP(77) 107 and 108 the Lord Privy Seal suggests that the cases of the National Health Service Consultants and the British Nuclear Fuels Limited (BNFL) directors must be treated alike as the strength of the legal advice seems to be similar. That is not my view. In my opinion there is a clear pre-pay policy contractual link between the BNFL directors' salaries and the corresponding Civil Service grades. This is not the position (see below) in respect of the Consultants' claim. My advice is that a claim by the BNFL directors would succeed in the courts.
3. Leaving aside the legal position, my colleagues may also think that the political impact of upholding the claim of a very small number of nationalised industry board members to equality of treatment with the Civil Service is likely to be very different from the political impact of allowing a large number of National Health Service (NHS) Consultants to obtain large retrospective payments in respect of the second stage of the Doctors and Dentists Review Body (DDRB) recommendation, when, as I understand it, no other "top salary" group has received the benefit of that stage.
B. NATIONAL HEALTH SERVICE CONSULTANTS
4. In July 1975 the Consultants were awarded an increase to be staged as to Stage 1 (retrospectively) from 1 April 1975, and as to Stage 2 from 1 April 1976. This was agreed by the Joint Negotiating Committee (JNC) and received the necessary statutory approval of the Secretary of State by circular.
5. In February 1976 a circular ("the second circular") provided as follows and received the necessary statutory approval of the Secretary of State:
"Staged Increases
7. Increases in remuneration which were due to be paid from 1 April 1976 in accordance with the staging arrangements set out in paragraphs 3 and 15-17 of the Appendix to HSC(IS) 159 and paragraphs 8-10 of HSC(IS) 167 will not now be payable from that date.
Payments Withheld
08. Payments withheld in accordance with paragraphs 6 and 7 of this notice will not subsequently be paid retrospectively, but will be credited in full for superannuation purposes."
09. Circulars in similar terms were issued for Wales and Scotland.
10. In August, 1977, the Solicitor-General, in my absence abroad, advised that there were two important areas of doubt:
a. As to whether in law the Consultants retained any right to the Stage 2 increase (having regard to the real possibility that the second circular might be held by the courts to have deferred the Consultants' rights other than for superannuation purposes indefinitely) or whether their rights were merely deferred in law until Pay Policy permitted them to be paid; and
b. as to whether, if the second circular gave the Consultants a claim in law to their increase under Stage 2 as soon as Pay Policy permitted, the Second White Paper permitted the whole of Stage 2 increase to be paid from 1 April 1977, or only the £4 provided for in the Second White Paper.
08. My advice, with which the Solicitor General agrees, is that the doubts on both these points are now so great that the Government is fully entitled to resist the Consultants' claim. In the light of the information available since August I believe that there is a very substantially lower chance of the Consultants succeeding than the Solicitor General and the Lord Advocate envisaged at that time. We have still had no legal claim from the Consultants founded upon a right to the Stage 2 increase accruing since 1 April 1977, notwithstanding that the Department of Health and Social Security have approved payment of the Second White Paper £4 increase. We may be confident that, if they had had even moderately strong legal advice in their favour, we should have heard something of it by now.
09. If we rely on these very serious doubts as to their legal entitlement the issue becomes purely one of policy as to how much to allow the Consultants and when. I think that we should be quite safe in adopting this line. I do not think that we could be fairly criticised even if (which I regard as unlikely) any claim they thereafter make in the courts were to succeed.
10. Having regard to the views expressed above on the effect of the second circular, it remains to apply the Pay Policy to the Consultants' case. They clearly have no claim until April 1978, 12 months after they received the £4 increase under the Second White Paper. But it is open to question whether they should be regarded as being then entitled to the full amount of the Stage 2 increases or whether any increase at that time should still be subject to the guidelines, i.e. confined to not more than 10 per cent. My colleagues may think that there are arguments in equity for giving them the full amount and that there is a clear distinction between the Consultants and other "top salaries" groups in that the Consultants did at one stage have a legal right to payment as from 1 April 1976, of which they have been deprived by executive act in the form of the second circular. Payment on 1 April 1978 would thus involve a 2-year deferment of a payment which all concerned thought in February 1976 would be subject only to a 1-year deferment, i.e. until 1 April 1977. This, however, is a matter of policy and equity rather than of law.
Royal Courts of Justice
5 December 1977 CABINET
PAY OF NATIONALISED INDUSTRY BOARD MEMBERS
Memorandum by the Lord Privy Seal
1. At last Thursday's meeting (CM(77) 38th Conclusions) I was asked to report on a scheme to pay a 5 per cent increase to board members and consequentials, either on the kitty principle, or as a flat rate, with a few exceptions of up to 10 per cent to deal with cases of particular hardship. I have not been able in the time available to make a thorough examination of hard cases with colleagues, though the bids we have received are listed at Annex B.
2. Annex A analyses the various arrangements which could be adopted to give effect to a general 5 per cent increase on the lines we discussed. There are no obvious special factors other than pay levels which would provide a consistent and generally acceptable means for distributing the increase. Of the various options I would myself favour that described in paragraphs 4 and 5 of the Annex, preferably using the £13,000 level to determine who should have the higher increases.
3. But before we finally decide upon the increases to be given, I think we should pause to consider other aspects of the matter. Since the increases would not be in respect of a pre-policy commitment under the 1.1.75 recommendations (Top Salaries Review Body, sixth report (TSRB 6)), or constitute an interim payment with the balance to be made later, it must clearly be regarded as the Round 3 settlement for board members and consequentials which establishes their pay levels for the following 12 months.
4. It would be possible to relate payment to TSRB 6 and to make it on 1 January 1978. The 1.4.78 recommendations for board members (TSRB 10) would then remain to be considered for a settlement date at least 9 months later. This would leave board members with an increased feeling of injustice if the Government's decision was confined to them alone and was not presented as part of a coherent policy for the Review Body groups as a whole.
5. Moreover a decision to implement 5 per cent in January as a Round 3 settlement would be seen by the TSRB as in effect the rejection of their 1974 recommendations without any prospect that their April 1978 recommendations will be treated differently. They might well resign in consequence. This in turn would threaten the existence of the other two Review Bodies (covering the Armed Forces and Doctors and Dentists).
6. More generally, our decision would be seen as an act of explicit discrimination against the public sector - directed moreover against the group which has the best claim for preferential treatment. It would be assumed that the other TSRB groups would be similarly treated, and the Civil Service unions and the Doctors would be likely to see this as the writing on the well for them.
7. Many of these difficulties could be avoided by awaiting TSRB 10. This would mean that nothing could be done before April for board members. But once TSRB 10 comes out we shall be able to consider board members at the same time as other TSRB groups; and the TSRB report along with the other Review Body reports. Individual Round 3 settlements could then be developed consistently with one another. I think this course should be seriously considered. If on reflection we adopt it, an early announcement will be necessary.
8. Any decision not to allow TSRB 6 to be treated as a pre-policy commitment makes it difficult to do anything on pensions. If we maintain that increases should be restricted to 5 per cent in Round 3, whether we relate these to TSRB 6 or TSRB 10, we cannot credibly maintain that there is any intention of implementing TSRB 6. Retrospective promulgation of the full recommended rates would then be difficult to square with Inland Revenue's rules. It is therefore difficult not to conclude that any device to protect pensions is basically inconsistent with our decision on salaries and that there is no acceptable way of providing protection.
Civil Service Department
6 December 1977 WAYS OF DISTRIBUTING AN OVERALL 5 PER CENT PAY INCREASE
EQUAL CASH INCREASE
1. This would achieve a bias in percentage terms towards the lower paid members of the Group. But it would also cause severe compression of both relativities between boards and internal differentials within boards. The percentage increases at the lowest salaries would be close to 10 per cent, but those at the higher salaries would be very low.
The approximate cash increase would be £550. The percentage increases would range from about 9 per cent at the bottom to 2 per cent at the top, with an average of 5 per cent.
PROPORTIONAL INCREASES ON EXISTING OR RECOMMENDED RATES
3. Proportional increases within the overall 5 per cent pay bill figure would in cash terms favour the higher paid:
i. A 5 per cent flat rate increase would produce cash increases ranging from £300 at the bottom to £1,500 at the top. It would preserve existing relativities and differentials.
ii. Increases based on a proportion of the TSRB recommended increases (ie; approximately ( \\frac{1}{6} )th of these) would reflect relativities within the existing structure. The percentage increases range from 1( \\frac{1}{2} ) per cent to 16 per cent. The cash increases would range from about £150 at the bottom to £2,750 at the top.
iii. Increases within a 5 per cent kitty distributed to achieve the highest common proportion of the TSRB recommended rates (approximately 81 per cent of these) would reflect the relativities of the recommended structure, but the actual percentage increases would range as high as about 39 per cent at the top, and there would be some cases where current salaries are already more than 81 per cent of those recommended.
**FLAT RATE OF 5 PER CENT WITH EXCEPTIONAL ADDITIONS UP TO 10 PER CENT FOR HARD CASES**
4. This solution would go beyond an overall 5 per cent increase. The problem would be to define the hard cases. When TSRB6 increases were postponed an exercise was conducted to establish whether some lower paid individuals might be allowed through. This exercise showed that it was not possible to discern any special features which would justify special treatment but which would not involve repercussions on others within the group. The list at Annex B shows the current departmental bids. There is no clear criteria other than salary level. This solution would require the fixing of arbitrary limits below which higher percentage increases would be allowed. For example, if a 10 per cent increase were allowed to those at or below £6,000, this would raise the average percentage increase to 5.02 per cent; at £8,000 the figure would be 5.4 per cent; at £10,000 it would be 5.8 per cent and at £13,000 (the limit to which TSRB6 was paid in full to other groups) it would be 7 per cent.
5. There are considerable advantages in this system. It would be relatively easy to administer and it follows current practice of dealing with pay in percentage rather than cash terms. It would be especially advantageous if the salary point for the 10 per cent increase were to be fixed at £13,000 as this was the level to which the TSRB 6 recommendations were allowed in full for other groups. The disadvantages are that increases might have to be tapered at the change over point to avoid anomalies, and that the arbitrary nature of the dividing line could lead to substantial distortion in relativities within and between boards at this point.
MIXED CASH AND PERCENTAGE INCREASE
6. The basis here would be a fixed cash amount plus a percentage increase which would produce a 5 per cent increase at the mean salary for the group. This cash and percentage increase would then be applied at all salary levels. This would provide a balance in individual percentage increases in favour of the lower paid in the group. The percentage increases would then be less for the higher rates and more for the lower rates, but the actual cash increases would of course rise with salary.
7. The mean salary would be determined so as to ensure that the overall increase in the pay bill was at the accepted figure. This could be 5 per cent, or it could be higher if the position in paragraph 4 above was to be reflected, ie that the overall increase including hard cases should be more than 5 per cent. The balance of advantage to higher and lower paid groups would be determined by the proportion of cash to percentage increase. But as an illustrative example, if the mean salary was approximately £11,000 a cash sum of £275 plus 2½ per cent of salary would give £550 - a 5 per cent increase. At £30,000 the increase would be £1,025 - a 3.4 per cent increase, whereas at £6,000 it would be £425 - a 7 per cent increase. A 10 per cent increase would occur well below the salary of any member of the group.
8. This system would have the advantage that once the cash and percentage increases are determined they will operate evenly over the salary range. There is no sharp change point. As with the arbitrary level below which higher percentage increases would be allowed (paragraph 4) this system would provide higher percentage increases for the lower paid in the range, but it would do so within rather than in addition to the agreed overall percentage increase. In neither case would the higher increases be specifically related to "hard" cases. The most serious disadvantage is that it introduces the concept of cash payments into a policy designed to provide for percentage adjustments. | DEPARTMENT | BID | |----------------------------------|------------------------------------------| | DHSS | NIL | | DES | VICE-CHANCELLORS | | | Maximum permissible | | | For all other consequentials | | MAFF | NIL | | LORD CHANCELLOR'S OFFICE | 3 Law Commissioners | | | President Pensions Appeal Tribunal | | | Chairman of Council on Tribunal | | | Judge Advocate of the Fleet | | HOME OFFICE | No special cases but consider all 15 consequentials' salaries are too low. | | DE | NIL | | DOE | Water Authority Chairmen | | | Presidents and Vice-Presidents of Rent Assessment Panels | | WELSH OFFICE | Water Authority Chairmen | | DEPT OF TRANSPORT | NIL | | DEPT OF INDUSTRY | In general believe 1/6 recommended increases justified. But if a 5 per cent limit on general increase, then special cases would be the chairman and members of Post Office and Cable and Wireless Boards | | DEPT OF ENERGY | NCB two members | | | BGC two members | | | UKAEA one member (possibly also the Deputy Chairman) | | | Possibly certain consequentials in BNFL and TRC | | | Area Electricity Boards - 8 Chairmen | | | All, 12 Deputy Chairmen | DEPT OF TRADE CAA Deputy Chairman 3 members BAB 2 members
The salaries for these bids range from about £8,000 to £23,000. CABINET
INQUIRY INTO THE CROWN AGENTS Memorandum by the Lord Chancellor
01. The note by officials attached at Annex sets out in paragraph 8 the questions which Ministers must now consider in the light of the decision of the House of Commons on 5 December 1977. This was, in effect, to reject the Government's proposals to set up an inquiry which would sit in private but would publish its report, its terms of reference limited to assessing the culpability of individuals in the Crown Agents, the Ministry of Overseas Development, the Treasury, the Bank of England and the Exchequer and Audit Department. That rejection by the House of Commons followed a similar reaction by the whole of the Press to the announcement of the Government's decision.
02. The reasons put forward for the rejection are set out in paragraph 2 of the Annex. The major factor was the fear that a private inquiry would be a "cover-up" which would protect those who should not be protected.
03. In this situation, nothing less than a public inquiry would, I believe, now satisfy Parliamentary and public opinion. Paragraph 5 of the Annex identifies three possible forms of public inquiry - a non-statutory Inquiry, a 1921 Act Tribunal and a Select Committee of the House of Commons.
04. While a non-statutory Inquiry would get round any difficulty created by the language of the 1921 Act which requires the matter being enquired into to be "a definite matter of urgent public importance", and might (although I think this is doubtful) make it easier to build upon the Fay Report and its supporting evidence, I think the absence of compulsory powers would be a serious defect. Although in practice it may be true that even then the necessary evidence would be forthcoming, nevertheless a non-statutory Inquiry would, I believe, not inspire the same public confidence in the Tribunal's ability to get at the full truth. I think therefore that the only real choice now is between a Tribunal and a Select Committee.
05. As to the ground to be covered by the Inquiry, the possibilities are set out in paragraph 8(b) of the Annex. That set out in paragraph 8(b)(ii), i.e. "all individuals whose part in the Crown Agents affair may be thought to be blameworthy", would cover not only the individuals concerned in the Crown Agents, the Ministry of Overseas Development, the Treasury, the Bank of England and the Exchequer and Audit Department, but also the responsible Ministers and the businessmen and solicitors involved in the relevant Crown Agents "own account" transactions. It would therefore be appreciably wider than the original terms of reference proposed by the Government.
06. I do not think the scope should be narrower than this. The difficult question is whether the failure of organisations as well as of individuals should be expressly included. As organisations act through the individuals who run them, investigation of the failures of those individuals would enable the enquiring body, if so minded, to comment on failures attributable to organisational defects. In these circumstances I do not think it would be necessary to include a specific reference to the failure of organisations in the terms of reference, particularly when to do so could involve the risk of a very widespread inquiry covering again the whole ground of the Fay Report.
07. As to item 8(b)(iv) of the Annex, the investigation of the conduct of the individual businessmen and solicitors involved would enable the enquiring body to examine and report upon the relevant business and commercial practices in so far as they contributed to that conduct. A wide ranging investigation of commercial morality generally would not be appropriate for this kind of inquiry.
08. The merits and demerits of proceeding by way of a Tribunal under the 1921 Act or a Select Committee are conveniently set out in paragraphs 6 and 7 of the Annex. An additional difficulty attaching to a Select Committee is that it would cease to operate at the end of the Parliamentary session unless re-activated in the succeeding session. Dissolution of Parliament before the completion of the Select Committee's work could give rise to awkward consequences.
09. It is also to be borne in mind that any form of public inquiry into the conduct of individuals would almost inevitably preclude the institution of any criminal proceedings against them and could well involve the abandonment of any pending prosecution. Civil proceedings too might be prejudiced and could hardly be continued while the public inquiry was taking place.
10. Of the two options, I think a Tribunal of Inquiry would be a better means of satisfying public anxiety and public opinion, and of ensuring that those concerned are seen to be given fair treatment, even though this would inevitably take longer and be far more costly than a Select Committee.
11. At this stage it may be sufficient to announce the Government's intention that there should be a public inquiry and that its form and precise scope will be announced shortly. This would give the Government more time to consider both its terms of reference and, if it is to be a Tribunal, its composition, or, if it is to be a Select Committee, to enter into consultation with the other Parties in the House of Commons. Whichever procedure is decided upon, there would have to be a Parliamentary debate on a Resolution - in both Houses in the case of a Tribunal of Inquiry, or in the House of Commons in the case of a Select Committee.
E-J
Lord Chancellor's Office
7 December 1977 CROWN AGENTS - COMMITTEE OF INQUIRY
NOTE BY OFFICIALS
The Minister of State for Overseas Development announced on 1 December the Government's decision that following the Fay Report there should be a subsidiary inquiry under Sir Carl Aarvold with the following terms of reference -
"In the light of the report of the Fay Committee, to assess the nature and gravity of any neglect or breach of duty by individuals which may have occurred in the Crown Agents, the Ministry of Overseas Development, the Treasury, the Bank of England and the Exchequer and Audit Department."
This inquiry would have sat in private but its report would have been published. It would have had a clear and narrow objective - to help the management of the organisations concerned decide on any disciplinary action which was needed against individuals who were blameworthy for neglect or breach of duty.
2. In the House of Commons debate on 5 December (Hansard, Col. 1026-1096) and in press and public comment it has been strongly argued that the terms of reference are too narrow and that the inquiry should be in public. There are five strands in the criticisms -
(1) The inquiry should be in public in order to demonstrate that people in public positions are held to account for their misdeeds in the same way as private citizens;
(2) the inquiry should be in public to give Ministers and officials who were criticised in the Fay Report a public opportunity to justify themselves;
(3) a statutory inquiry is needed to compel evidence because some people (in fact three, of whom two were subject to criminal proceedings) refused to give it to the Fay Committee; (4) the inquiry needs to cover not just the behaviour of individuals but also the behaviour of the organisations concerned;
(5) the inquiry should deal with standards of commercial morality exposed by the Fay Report.
(A summary of the main points made in the Debate is at Appendix A.)
The Questions for Consideration
3. The Government does not formally need to take any action following its defeat on a motion to adjourn the House. There are indeed arguments for continuing with the private inquiry as originally conceived. It would be the quickest and cheapest way of establishing the culpability of individuals in the public service without pillorying in public individuals who were subsequently held to be relatively free of blame. It would keep to a minimum any duplication with the work of the Fay Committee and any diversion of effort from current work by the organisations concerned. Moreover if any public inquiry is set up it will in practice be necessary to abandon the criminal proceedings against Mr Sidney Finley (because the proceedings of the inquiry could prejudice his trial). This course would not however meet the strong views which have been expressed both in Parliament and more widely and Ministers may feel that some form of public inquiry is now inevitable. In that event the main questions for consideration are -
a. What should be the scope of such a public inquiry?
b. What form should it take?
The Scope of a Public Inquiry
4. There are four main possibilities -
a. A public inquiry with the same terms of reference as were proposed for the Aarvold inquiry
This would not meet the pressure from Government supporters for a wider inquiry although it would meet the desire of the Opposition that Mr Richard Wood should have an opportunity to defend his actions in public. In practice such an inquiry might well be driven wider than its terms of reference and a more effective inquiry might result if this were accepted from the start. It might well be thought inequitable that the public servants involved in the Crown Agents affair should be subjected to a public inquiry while those outside the public service who contributed to that affair were not formally subject to it. On the other hand it can be argued that there are clear standards of duty owed by public servants and that no corresponding obligations bind the other individuals involved. If they acted illegally the remedy lies in criminal proceedings. If not there is no reason why they should be subject to a public inquiry the proceedings of which could in practice leave a stain on their reputations even if they were cleared by the eventual report.
b. A public inquiry covering the conduct of individuals both inside and outside the public services involved in the Crown Agents affair
This would go a long way to meet the criticisms both in Parliament and in the press. The inquiry would still be kept within bounds. On the other hand such an inquiry could leave unfinished business if it exposed weaknesses in organisations without including recommendations to deal with them.
c. A public inquiry dealing both with the conduct of individuals and the working of the organisations involved (Crown Agents, ODM, Treasury, Bank of England and Exchequer and Audit Department)
This course would meet the widely-held view that weaknesses in organisations were as important as the failings of individuals in contributing to the difficulties of the Crown Agents and could provide the basis for effective remedies. An inquiry of this sort would however be more appropriately undertaken by a Royal Commission than by a judicial or semi-judicial body. It would be prolonged and could seriously divert the organisations concerned from their ongoing business and obviously duplicate the work of the Fay Committee. It could affect public confidence in Government as a whole as well as in the other institutions concerned. In any case an inquiry worth its salt looking into the conduct of individuals would be likely in practice to expose any weaknesses in organisations which came to its attention. d. A public inquiry ranging into the general issues of commercial morality raised in the House of Commons debate.
There was some demand for such an inquiry. It would however range so widely as to be of doubtful utility. It would overlay the work of the Wilson Committee on Financial Institutions.
Form of a Public Inquiry
5. It would be possible to have a non-statutory public inquiry. This would not be able to require the attendance of witnesses, a point to which much attention was directed in the House. This attention was somewhat misplaced. Fay managed well without powers but was of course sitting in private. Only three people refused to give evidence, two of them in any case subject to criminal proceedings. It would be most unlikely that the question of powers would arise with any still serving in the public sector as to disclosure of papers in that sector. If however a power to compel witnesses is felt to be essential in the case of an inquiry to be held in public the choice lies between -
a. an inquiry under the Tribunals of Inquiry (Evidence) Act 1921; its establishment would require affirmative resolutions in both Houses of Parliament;
b. an investigation by a Select Committee of the House of Commons.
6. An inquiry under the 1921 Act would be the normal procedure for dealing with this sort of case. It would ensure a judicial hearing for those who were subject to criticism. The tribunal would have statutory powers to compel witnesses to attend and give evidence. On the other hand such an inquiry would be slow-moving (probably taking at least a year) and expensive (the costs could amount to about £1 million). The proceedings of the tribunal could attract maximum publicity while it was sitting. There could be a problem of forming terms of reference which met the requirement of the 1921 Act that a tribunal is to inquire into "a definite matter ... of urgent public importance".
7. A Select Committee of the House of Commons could inquire into the way the House itself handled the Crown Agents affair. It can be held that a situation which has been provoked by an unprecedented surge of back bench opinion requires action by Parliament itself. A Select Committee would in practice be able to compel evidence. Failure to submit it would be a breach of privilege. The problem is essentially bipartisan: the events in question took place under administrations of both Parties. On the other hand since the Select Committee on the Marconi scandal in 1912 Select Committees have been generally thought to be an unsatisfactory way of investigating allegations of public misconduct. The Report of the Royal Commission on Tribunals of Inquiry under Lord Justice Salmon in 1966 commented -
"The Marconi scandal for this purpose sounded the death knell of this form of investigation, and because it was wholly discredited, the Act of 1921 was passed. To go back to it would, in our view, be a retrograde step. We of course recognise that there are many purposes for which Select Parliamentary Committees are most useful and indeed indispensable - but the investigation of allegations of public misconduct is not one of them. Such matters should be entirely removed from political influences." (Cmd. 3121 para. 35)
In addition a Select Committee would also be costly as those involved would no doubt expect to be provided with legal representation. And there could be some awkwardness if a Select Committee had not completed its work during the life of the present Parliament.
Questions for Decision
8. The questions which Ministers will wish to consider are -
a. Should the inquiry be held in public or private (paragraph 3);
If the inquiry is to be held in public -
b. Should it cover -
1. the conduct of individuals in the Crown Agents, the ODM, the Treasury, the Bank of England and the Exchequer and Audit Department; ii. all individuals whose part in the Crown Agents affair may be thought to be blameworthy;
iii. failure of organisations as well as of individuals;
iv. the wider question of commercial morality raised by the Crown Agents affair? (paragraph 4)
c. Should it be conducted in -
i. a non-statutory public inquiry;
ii. a tribunal under the 1921 Act;
iii. a Select Committee of the House of Commons (paragraphs 5-7). The main criticisms made on the debate on 5 December were as follows -
The business practices of the City
Criticism of such practices as letters of comfort or window-dressing (i.e. giving false information to shareholders). "This happens in the City all the time." - Mr John Mendelssohn.
The Bank of England
Criticism of the Bank for turning a blind eye to what was going on at the Crown Agents for so long, to which was coupled criticism of the auditors and solicitors involved.
- Mr John Mendelssohn
- Mr Cunningham
- Mr Skinner
The need to tighten the regulations and rules under which auditors prepare balance sheets -
- Mr Peter Brooke
The Civil Service
The Service was criticised especially for its mode of recruitment, its lack of business expertise and, in the case of the Treasury, for its pre-occupation with relatively minor matters concerned with the Crown Agents when it failed to notice massive losses resulting from speculative dealings.
- Mr Michael English
- Mr George Cunningham
- Mr Dennis Skinner The Director of Public Prosecutions Criticism of his slowness of action in this case.
- Mr Dennis Skinner
The Excessive Independence of the Controller and Auditor General
- Mr Michael English
Suppression and cover up Criticism of attempts made to dissuade the present Minister of Overseas Development from pursuing her attempts to bring the affairs of the Crown Agents into the open. Reference to "a closing of ranks".
- Sir Harold Wilson
The House of Commons Failure to organise itself so that Select Committees could pursue investigations of the kind that could have revealed at an earlier stage the situation of the Crown Agents.
- Mr George Cunningham
Failure of the House to exercise proper control
- Sir Harold Wilson
Failure of the House to react to warnings from the Press about the difficulties of the constitutional relationship, the speculative work of the Crown Agents and the possible financial dangers for the Government.
- Mr George Cunningham
The Select Committee on Overseas Development Lack of urgency to start investigation of the affairs of the Crown Agents and lack of tenacity in terminating their inquiries prematurely.
- Mr Cunningham II. Proposals for an open inquiry came from Mr Mendelssohn who opened the debate, and most of those who followed. The main points in favour of this course of action were -
The need to avoid a whitewash and to counter "great distrust about Whitehall and about Parliament".
- Mr Richard Luce
The need for judicial procedures to give adequate protection to witnesses. The form of inquiry should be such as to compel witnesses to give evidence; reference to the Salmon Report on Tribunals of Inquiry in support of the 1921 Act procedure.
- Sir Michael Havers
Request for a special inquiry in respect of the Crown Agents Australian Investment.
- Mr Frank Tomney
7 December 1977 12 December 1977
CABINET
PUBLIC EXPENDITURE WHITE PAPER
Memorandum by the Chief Secretary, Treasury
1. In accordance with the Cabinet Conclusions of 20 October (CM(77) 32nd Conclusions), I am circulating herewith a draft of Volume I of the Public Expenditure White Paper. If we can clear the draft at our meeting on 15 December, that will enable us to publish on Thursday 12 January, shortly after the House reassembles on 9 January. I am circulating Volume II separately with the suggestion that it should be cleared in correspondence.
2. The main purpose of the White Paper is to present publicly the public expenditure programmes as revised by the decisions we took in October. Account is taken of some later developments, including the new agreement now concluded with the banks on refinancing of export and shipbuilding credit and estimating changes on social security and agricultural support. The contingency reserve figures for 1979-80 and the two subsequent years have been raised to £1,500 million, £1,750 million and £2,000 million respectively (all figures at 1977 survey prices).
3. The section on the economic context (paragraphs 48-59) contains a table of illustrative economic projections on the lines of those given in the Chancellor of the Exchequer's paper discussed at Cabinet in July (CP(77) 70). The text emphasises that the projections are no more than illustrations of one possible evolution of resource use over the years ahead, on one particular assumption about the growth of total output.
4. The draft also includes a table of revenue projections (Table 9). The figures in the table are subject to final checking. The Expenditure Committee and others have been pressing for a fuller account of the general economic background to the expenditure plans, and in particular for revenue projections (which were provided in the 1969 White Paper (Cmnd 4234)). We have told the Committee that we will provide revenue projections.
5. Subject to any further minor revisions or drafting changes which may be necessary, I invite my colleagues to approve the attached draft of Volume I of the White Paper for publication.
J B
Treasury Chambers
12 December 1977 The Government's Expenditure Plans, 1978-79 to 1981-82 Volume I
Presented to Parliament by the Chancellor of the Exchequer by Command of Her Majesty January 1978
LONDON HER MAJESTY'S STATIONERY OFFICE p net Cmnd 0000—1 THE GOVERNMENT'S EXPENDITURE PLANS, 1978-79 TO 1981-82
PART I
Contents
The Government's expenditure plans ........................................ 1-5 Summary of the plans ......................................................... 6-10 Expenditure in 1976-77 ....................................................... 11-16 Expenditure in 1977-78 ....................................................... 17-22 Expenditure plans, 1978-79 and after .................................... Central government ....................................................... 23-24 Nationalised industries .................................................. 25-28 Local authorities ......................................................... 29-36 Contingency reserve ..................................................... 37-38 Debt interest ............................................................. 39-40 Analysis by economic category ....................................... 41-43 Public expenditure and gross domestic product ....................... 44-47 The economic context ....................................................... 48-59 Revenue projections and general government balance ............... 60-67 Conclusion ........................................................................... 68
SUMMARY OF TABLES
| Table | Description | Page | |-------|-----------------------------------------------------------------------------|------| | 1 | Public expenditure plans | 2 | | 2 | Public expenditure, 1974-75 to 1977-78 | 4 | | 3 | Central government expenditure programmes | 6 | | 4 | Nationalised industries' borrowing | 6 | | 5 | Public expenditure by local authorities (Great Britain) | 8 | | 6 | Financing of local authority relevant expenditure (Great Britain) | 9 | | 7 | Ratios of public expenditure to GDP at market prices | 11 | | 8 | Gross domestic output and expenditure | 13 | | 9 | General government account | 14 | | 10 | Public expenditure by programme and in total | 17 | | 11 | Public expenditure by economic category and in total | 18 | | 12 | Public expenditure by spending authority and programme and in total | 19 | | 13 | Public expenditure by spending authority and economic category | 20 | | 14 | Comparison of planned expenditure and estimated outturn in 1976-77 and 1977-78 by spending authority and economic category | 21 | 15 Summary of changes since Cmnd 6721
16 Changes to expenditure programmes since Cmnd 6721
17 Changes to expenditure programmes since Cmnd 6721 by economic category THE GOVERNMENT'S EXPENDITURE PLANS, 1978-79 TO 1981-82
PART 1
This White Paper presents the Government's latest plans for public expenditure. Volume I gives a general account of the plans and their economic and fiscal context, Volume II details of individual expenditure programmes and supporting material.
2. The improvement in the country's financial situation, to which the cuts in public expenditure plans which preceded last year's White Paper (Cmnd 6721) made an important contribution, enables the Government now to plan for resumed and continuing expansion of many programmes financed by public expenditure. Along with other measures to improve the outlook for employment and to bring the growth of output on to its intended path, the Chancellor of the Exchequer announced on 26 October 1977 the Government's decision to add £1 billion(1) to the plans for 1978-79. That decision is reflected in the present White Paper.
3. Renewed expansion in expenditure plans must be governed by the Government's broad economic objectives of containing inflation, reducing unemployment and promoting industrial efficiency. In addition, the Government now aim at a greater degree of stability than has been achieved in recent years, so that expenditure programmes can be managed with confidence that they will not be subjected to the disruption of sudden cuts.
4. Both for this reason, and in order to leave room for manoeuvre on taxation, it is necessary that the planned growth rate for total public expenditure should be within the prospective growth rate of national income. The present plans are constituted to this end. As always those for the later years are provisional. The Government want to improve and in many cases expand the provision of public services, and will do so as circumstances permit; but they do not intend to set up plans which go beyond what the economy can safely be assumed capable of sustaining.
5. The Government intend to maintain and develop the procedures of expenditure control, including the new features introduced in recent years, such as the system of cash limits and strict observance of the announced control figure for the contingency reserve, and the arrangements for monitoring expenditure in the course of the year as described in Cmnd 6721. The latter is an important management tool which, as experience grows in its use, should promote a closer match between plans and outturn.
______________________________________________________________________
1 All figures in this White Paper are at 1977 survey prices unless otherwise stated. They have each been rounded to the nearest £1 million and do not therefore necessarily sum to the totals. Summary of the plans
6. The planning figures for public expenditure until 1981–82 are shown in table 1, together with the Cmnd 6721 planning figures for the current year. The tables at the end of this volume give more details.
Public expenditure plans
| TABLE 1 | £ million at 1977 survey prices | |---------|-------------------------------| | | 1977–78 | 1978–79 | 1979–80 | 1980–81 | 1981–82 | | Expenditure on programmes: | | | | | | | Central government | 39,582 | 41,660 | 41,982 | 42,419 | 42,569 | | Local authorities | 15,399 | 15,488 | 15,718 | 15,889 | 15,990 | | Total general government | 54,981 | 57,148 | 57,700 | 58,308 | 58,559 | | Certain public corporations(1) | 992 | 952 | 1,012 | 1,002 | 1,015 | | Total expenditure on programmes | 55,973 | 58,100 | 58,712 | 59,310 | 59,575 | | Contingency reserve | 750 | 750 | 1,500 | 1,750 | 2,000 | | Total | 56,723 | 58,850 | 60,212 | 61,060 | 61,575 | | Debt interest | 2,500 | 2,000 | 1,900 | 1,800 | 1,600 | | Total public expenditure | 59,223 | 60,850 | 62,112 | 62,860 | 63,175 | | Total programmes, contingency reserve and overseas and market borrowing of nationalised industries | 57,263 | 58,550 | 59,612 | 60,860 | 61,325 |
1 Corporations whose capital expenditure is included in public expenditure: mainly the water authorities and housing corporations. These corporations do not include the nationalised industries. A list is given in part 6.
07. The figures for the year immediately ahead, 1978–79, are firm plans. These provide the basis of Estimates, cash limits and rate support grant. The figures for the succeeding years are increasingly provisional: they will be reviewed in successive annual surveys.
08. The planned total of public expenditure programmes and the contingency reserve for 1978–79, adjusted to include the total net borrowing requirement of the nationalised industries (see paragraph 9 below), is approximately £1 billion higher, at 1977 survey prices, than the provisional plans for that year published in Cmnd 6721.
09. Public expenditure, as defined in these White Papers, includes finance provided by the Government to the nationalised industries, whether by loans, public dividend capital or grants. The amount provided by the Government is greatly affected by the net amounts which the industries borrow from, or repay to, overseas lenders or the market. As the Select Committee on Expenditure have pointed out, such borrowing, or repayments, can distort the year-to-year path of government lending to the industries, and hence of public expenditure as a whole: over the next few years the industries are due to repay substantial amounts borrowed from overseas lenders in the mid-1970s, and to replace this by borrowing from the National Loans Fund. One way of discounting this is to adjust the planned total of programmes and the contingency reserve to include the total net borrowing requirement of the nationalised industries (not just what the Government lends to them). Line 10 of table 1 gives figures for the total adjusted in this way.
10. This adjusted total rises by about 2½ per cent in 1978–79, compared with the Cmd 6721 plans for the current year (1977–78)(1). The rate of growth in the two succeeding years—1979–80 and 1980–81—is of the order of 2 per cent a year. The present figure for 1981–82 is under 1 per cent, but the plans in the later years are increasingly provisional and subject to revision in subsequent surveys; this applies especially to the final year. The precise figures are:
| Year | Percentage Change | |----------|-------------------| | 1978–79 | +2.2% | | 1979–80 | +1.8% | | 1980–81 | +2.1% | | 1981–82 | +0.8% |
Expenditure in 1976–77
11. At outturn prices, total public expenditure in 1976–77 was £55½ billion. This was nearly 11 per cent more than the outturn price figure for 1975–76, but in volume terms (constant prices) the total of programmes excluding debt interest was less than in 1975–76, by nearly 3½ per cent. This fall owed much to a reduction in net government lending to nationalised industries, as the industries borrowed heavily in foreign currency. In total public expenditure including debt interest the fall was somewhat less than in programmes alone, because payments of debt interest increased. Table 2 gives the figures.
12. The outturn of programmes in 1976–77 was less in volume terms than the Cmd 6721 plans for that year, by about 3½ per cent, or £2½ billion at 1977 survey prices.
13. One major difference between plans and outturn was in programme 5, government lending to nationalised industries. This is a particularly difficult programme to forecast. The 1976–77 outturn figure of £330 million was not only much lower than in the previous year (see paragraph 11 above) but also well below the 1976–77 provision of £917 million in Cmd 6721: overseas borrowing by the industries was greater than assumed in Cmd 6721, which provided only for such overseas borrowing as had already been undertaken when the figures were prepared. In addition, both the trading results and the capital expenditure of the nationalised industries turned out differently from the assumptions used in Cmd 6721.
______________________________________________________________________
1 The increase compared with the latest estimates for 1977–78 is much greater, but this is not a valid comparison: the latest estimates for 1977–78 provide for some underspending but no such provision is made in the plans for 1978–79, although under-spending is likely to occur in that year also. See further paragraphs 21–22. 14. The aggregate outturn in 1976-77 in volume terms on all programmes other than the nationalised industries was about 3 per cent below the planning figure in Cmnd 6721. In some programmes, notably education, health and social security, the difference was slight, but outturn was below the plan in every programme. Details are in tables 14 and 16 and in Part 2.
15. Many factors contributed to this difference. The more extensive use of cash limits was itself probably one, as many programme managers were especially careful to run no risk of exceeding their limits. On the central government programmes covered by cash limits, expenditure (at outturn prices) was about 2 per cent or £600 million below those limits. In volume terms the difference was somewhat greater, since prices rose faster than had been allowed for when the cash limits were set. Another factor was that expenditure on new measures to promote employment turned out less than the original estimate. Other factors included over-provision for refinancing of export credit, unavoidable delays in obtaining some defence equipment, and delays in road building as a result of weather conditions in the second half of the year.
16. The volume of local authority current expenditure was marginally below that envisaged just before the year began for England and Wales, and marginally above for Scotland. The overrun expected last autumn, and built into the Cmnd 6721 figures, did not occur.
### Public Expenditure, 1974-75 to 1977-78
| TABLE 2 | £ million at 1977 survey prices | |---------|--------------------------------| | | 1974-75 | 1975-76 | 1976-77 | 1977-78 estimated | | Expenditure on programmes: | | | | | | Central government | 39,661 | 40,280 | 39,245 | 38,126 | | Local authorities | 16,904 | 16,739 | 15,910 | 15,161 | | Total general government | 56,565 | 57,019 | 55,155 | 53,287 | | Certain public corporations(1) | 1,138 | 1,176 | 1,047 | 922 | | Total expenditure on programmes | 57,703 | 58,194 | 56,201 | 54,209 | | Debt interest | 907 | 1,169 | 1,662 | 1,900 | | Total public expenditure | 58,610 | 59,363 | 57,863 | 56,109 | | Total programmes and overseas and market borrowing of nationalised industries | 58,743 | 59,077 | 57,635 | 54,739 |
1 See note (1) to table 1.
### Expenditure in 1977-78
17. Table 2 summarises the estimate of outturn in 1977-78 used in this White Paper, alongside the latest estimates for the past three years. For 1977-78 the volume of expenditure on programmes is now put at about 95% per cent of the Cmd 6721 provision for programmes and contingency reserve. In addition, the expected net outturn of debt interest is significantly below the figures in Cmd 6721.
18. A considerable part of the difference of 4½ per cent between the outturn for programmes now expected and the earlier plans is attributable to two major items: government lending to nationalised industries, which is again expected to be substantially lower than planned initially, and refinancing of export and shipbuilding credit, which, partly owing to the new arrangements with the banks, is expected to show net repayments to the government this year. Apart from these two items, the outturn is now estimated at over 97 per cent of the Cmd 6721 plans.
19. The changes from Cmd 6721 reflect many causes. For example, lower interest rates have reduced the scale of housing subsidies, some delay is still being experienced in defence works and procurement programmes and, in some cases, firmer estimates of expenditure in 1976–77 have led to revised estimates for the current year.
20. The value of central government expenditure covered by cash limits in the first half of the financial year was about 3½ per cent below what departments had expected at the beginning of the year. For the year as a whole the estimates given in this White Paper reflect the belief of departments that the volume of their expenditure over the full year will be somewhat nearer the initial plans. For local authority current expenditure the figures now given are consistent with those available at the time of the negotiation of the rate support grant for 1978–79.
21. Some continuing divergence between planning figures and outturn is to be expected in future years. Any system of control which applies limits to programmes will normally result in outturns being somewhat less than planned levels. The likelihood of such shortfall is taken into account in the forecasts for the economy and the public sector borrowing requirement which inform the Government’s consideration of public expenditure, and hence in the decisions on the planned level of expenditure. (1)
22. How completely plans will be achieved in any one year is hard to predict, particularly in the light of recent experience. There is a general tendency to over-estimate the extent to which expenditure can be increased rapidly in the short run. But increasing familiarity with the new control and information systems should promote a closer match between estimates and outturn.
Expenditure plans, 1978–79 and after
Central government
23. The main services provided by the central government (including transfer payments) account for over 70 per cent of total programmes. Figures for these services are summarised in table 3.
1 An allowance for shortfall is made below in the table 9 projections of expenditure and revenue. Central government expenditure programmes
TABLE 3
| | 1975-76 | 1976-77 | 1977-78 estimated | 1978-79 | 1979-80 | |----------------------|---------|---------|-------------------|---------|---------| | Defence | 6,445 | 6,361 | 6,255 | 6,289 | 6,494 | | National health service | 5,981 | 6,051 | 6,132 | 6,255 | 6,350 | | Social security | 12,309 | 12,717 | 13,226 | 14,063 | 14,174 | | Other expenditure | 15,545 | 14,115 | 12,513 | 15,053 | 14,964 | | Total | 40,280 | 39,245 | 38,126 | 41,660 | 41,982 |
24. About 40 per cent of public expenditure by the central government, excluding debt interest, is on goods and services, the largest elements being defence and the national health service. The remainder consists of transfer payments—including social security benefits, housing subsidies and industrial support—and net lending, which includes loans to nationalised industries.
Nationalised industries
25. The table 3 figures for public expenditure by the central government include provision for government lending to the nationalised industries. Estimates of this lending are shown in table 4, along with estimates of the total net borrowing requirement of the industries, which are included in the adjusted planning total in table 1. The differences between the two sets of figures reflect the industries' net borrowing from, or repayments to, the market and overseas, and in particular the major programme of foreign currency and market debt repayments which the industries are expected to make between 1978-79 and 1980-81. The precise timing of this programme is uncertain. If repayments were made sooner than assumed in table 4, that would affect the figures for net government lending, but total net borrowing by the industries would not be affected to any great extent.
TABLE 4
| | 1976-77 | 1977-78 estimated | 1978-79 | 1979-80 | 1980-81 | 1981-82 | |----------------------|---------|-------------------|---------|---------|---------|---------| | Net government lending | 330 | 420 | 1,350 | 1,550 | 1,350 | 1,100 | | Total net borrowing (other than short-term) | 1,764 | 950 | 1,050 | 950 | 1,150 | 850 |
26. The estimates for total net borrowing show the industries' requirements for loans from all sources and for public dividend capital. They depend on assumptions about the level of investment by the industries, their markets, pricing policies and productivity. They may need to be revised further when the Government has completed the process of setting financial targets for each of the industries, and in the light of the current consideration of the problems of the British Steel Corporation.
27. Notwithstanding these uncertainties, the fall in the industries' overall net borrowing requirement after 1976-77 marks an improvement in the financial position of most of them. After the deficits caused by price restraint in the early 1970s most of the industries are now profitable again as a result of the progressive return to economic pricing. They are therefore able to make a substantial contribution to the financing of their own investment which is expected to amount to about £3½ billion in 1977-78 and in 1978-79. It is part of the Government's medium term expenditure strategy that this improvement in the industries' financial position should be maintained.
28. Volume II contains a commentary on each of the nationalised industry programmes and presents figures for the industries' capital investment programmes and their financing.
Local authorities
29. Local authorities are responsible for more than one-quarter of public expenditure. They are responsible for the greater part of expenditure on education (which accounts for more than half of their current expenditure), on housing (which accounts for a similar proportion of their capital spending), and on other environmental services. They employ more than one in ten of the working population.
30. The Government does not have the same direct control over expenditure by local authorities as over its own spending. Part 1 of Cmnd 6721 explained the means of influence open to the Government and the extent to which the Government's ability to regulate this expenditure within a reasonable margin is dependent on the co-operation of local government. Green Papers on Local Government Finance (Cmnd 6811 and 6813) were published in May 1977 following the report of the Layfield Committee. These emphasised the need to develop, on a partnership basis between central and local government, the duties and responsibilities involved in the provision of local public services. They proposed financial arrangements designed to give a substantial degree of local autonomy while safeguarding the central government's economic responsibilities and policy interests. This was intended to provide a satisfactory long-term basis for ensuring that total local authority expenditure was maintained at a level which the country can afford. Discussions are continuing with the local authority associations about these proposals.
31. Over the past three years, current expenditure by local authorities has had to be reined back. A year ago it was still feared that the adjustment was not being achieved as quickly as the Government had hoped, and that an absolute reduction in the volume of expenditure might be required in 1978-79. In the event, a rate of growth which had reached nearly 10 per cent in the one year 1974-75 has been succeeded by an increase of only about half that amount over the whole of the following three-year period.
32. General recognition of the requirements of the economic situation, and restrictions on the availability of government finance, have no doubt contributed to the speed with which this necessary adjustment has been achieved. But it also illustrates the increasingly close co-operation between central and local government in the planning and control of public expenditure, through the Consultative Councils on Local Government Finance in England and Wales and in discussions with the Convention of Scottish Local Authorities.
**Public expenditure by local authorities (Great Britain)**
| TABLE 5 | £ million at 1977 survey prices | |---------|--------------------------------| | | 1975-76 | 1976-77 | 1977-78 estimated | 1978-79 | 1979-80 | | Current expenditure: | | | | | | | Environmental services(1) | 1,382 | 1,431 | 1,466 | 1,445 | 1,483 | | Law, order and protective services | 1,321 | 1,378 | 1,393 | 1,416 | 1,432 | | Education and libraries, science and arts | 6,351 | 6,384 | 6,438 | 6,535 | 6,568 | | Health and personal social services | 987 | 1,012 | 1,044 | 1,072 | 1,096 | | Other programmes | 1,664 | 1,541 | 1,502 | 1,495 | 1,513 | | Total | 11,705 | 11,746 | 11,843 | 11,962 | 12,090 | | Capital expenditure | 4,815 | 3,945 | 3,083 | 3,282 | 3,376 | | Total | 16,520 | 15,691 | 14,926 | 15,244 | 15,467 |
1 Programme 8 “other environmental services”
33. It is no longer necessary for the total volume of current expenditure to be cut in 1978–79. After taking account of demographic factors and of the continuing revenue effects of capital projects, there will be little scope for improvements in the level of service provision, and continued restraint in local authority spending plans will be necessary. However, as the figures in table 5 show, the rate support grant settlements for 1978–79 provide for some resumption of growth in the total of current expenditure.
34. Similarly, the plans in Cmnd 6721 for the capital expenditure of local authorities also provided for a reduction in 1978–79 compared with the current year. Now it is possible to look ahead to a small increase. The figures shown in table 5 reflect the special measures to assist the construction industry announced during 1977.
35. The Government will be discussing the implications of the plans in this White Paper for the years after 1978–79 with the local authority associations in the Consultative Councils and the Convention in the normal course of the next public expenditure survey.
36. The definition of local authority current expenditure for White Paper purposes differs in certain respects from “relevant expenditure” which is the aggregate on which the level of government grants to local authorities is based each year following the rate support grant discussions. For 1978–79 the percentage of aggregate Exchequer grant has been fixed at the same level as for 1977–78, that is 61 per cent for England and Wales and 68½ per cent for Scotland. Table 6 shows how relevant expenditure has been financed since 1975–76 as between central and local sources of revenue and how the Government expects it will be financed next year. A reconciliation between local authority current expenditure in public expenditure survey terms and “relevant expenditure” is given in Volume II of this White Paper. Financing of local authority relevant expenditure (Great Britain)
TABLE 6
| | £ million at outturn prices | |----------------------|-----------------------------| | | 1975-76 | 1976-77 | 1977-78 estimated | 1978-79 | | Total expenditure(1) | 11,230 | 12,610 | 13,990 | 15,120 | | Government grants | 7,420 | 8,260 | 8,610 | 9,280 | | Local rates, including rate rebate grants and changes in local balances | 3,810 | 4,350 | 5,380 | 5,840 |
1 Includes a small element of expenditure met from rates which is not relevant for grant purposes.
Contingency reserve
37. The planning totals for the years ahead include substantial contingency reserves to cover unforeseen items and items which cannot be properly quantified at this stage. The scale of provision is shown in table 1, line 6. The size of the contingency reserve for the later years is reviewed along with the spending programmes in each successive annual survey.
38. As explained in Cmd 6721, any addition to a programme decided upon during the year is charged against the contingency reserve if it cannot be offset by an appropriate saving in the programme concerned or other programmes. The arrangements for approving claims on the contingency reserve, and for monitoring these claims, form an important part of the Government’s procedures for control of public expenditure.
Debt interest
39. The figures for total public expenditure shown in table 1 include debt interest, but debt interest payments are not included in the planning totals discussed in paragraphs 7-10 above. In Cmd 6721 a new concept of debt interest payments was introduced, including only those payments which have to be financed from taxation or further government borrowing. Payments met from interest receipts on money lent, or for which provision is made from trading surpluses or rents, are excluded.
40. On this basis the estimate for 1977-78 is £1,850 million compared with the 1976-77 figure of £1,700 million (both at 1977 survey prices). The estimates for this year and next are substantially below those in Cmd 6721, which were £2,650 million and £ million respectively, on a comparable basis. The reductions are due mainly to lower borrowing and interest rates than were assumed when the Cmd 6721 estimates were made. Volume II of this White Paper gives a fuller explanation.
Analysis by economic category
41. Tables 10 and 12 show that the economic analysis of public expenditure is not expected to change much over the planning period. Current expenditure on goods and services, which now accounts for nearly half the total, continues to rise slowly.
42. Public expenditure on fixed investment increases over the planning period but remains relatively low compared with the years up to 1975–76. Most of it is construction work, and the extra spending on construction announced during 1977 means that a steady level of direct public spending on construction in the next four years is now planned, at rather over £4½ billion a year. In addition, government grants and lending help to finance other construction work, for example by the nationalised industries and housing associations. If construction expenditure by those bodies is included, the total planned level of public spending on construction rises to some £6½ billion in 1978–79 and some £6½ billion in 1981–82. Fuller details are being published separately and will appear in the next issue of “Housing and Construction Statistics”.
43. Transfer payments increase in total over the planning period, with some changes in composition. Payments to individuals, notably of pensions and other social security benefits, continue to rise, while subsidies tend to fall. There are marked changes in net lending, including the increased government lending to nationalised industries and the reduced government refinancing of fixed rate export and shipbuilding credit mentioned earlier.
Public expenditure and gross domestic product (GDP)
44. In the first half of this decade public expenditure continued to grow at much the same rate as in the previous decade, while national disposable income grew very little, partly because of the slow growth in output and partly because of the deterioration in the terms of trade. The ratio of total public expenditure to GDP(1) increased from 38 per cent in 1971–72 to 46½ per cent in 1975–76, and fell to 44½ per cent in 1976–77.
45. This ratio is not a wholly satisfactory indicator of the importance of the public sector in the economy as a whole. Total public expenditure includes transfers and loans to the private sector, which require government taxation or borrowing but finance private, not public, consumption and investment. Moreover, the total is affected by changes in the extent to which the nationalised industries rely on the Government to meet their external financing needs.
46. For some purposes a more useful ratio is that for general government(2) expenditure on goods and services. This ratio rose from 22½ per cent of GDP in 1971–72 to 27 per cent in 1975–76, and fell to 26 per cent in 1976–77. On either basis there was a sharp increase up to 1975–76 followed by some fall last year. Table 7 gives a run of figures.
______________________________________________________________________
1 To calculate these ratios total public expenditure is taken at current prices (or, for future years, in cost terms) and increased by an estimate of the value of government capital assets consumed during the year to make the figures comparable with the figures of GDP. The latter are measured at market prices (inclusive of indirect taxes and net subsidies) because this is the valuation basis of the public expenditure figures. The provision for capital consumption was included in the figures for government consumption and GDP this year for the first time in place of the former concept of notional or imputed rent on buildings owned and occupied by the Government.
2 Central government and local authorities. Ratios of public expenditure to GDP at market prices
| Year | Total public expenditure | General government expenditure on goods and services | |--------|--------------------------|-----------------------------------------------------| | 1971-72 | 38 | 22% | | 1972-73 | 39 | 22% | | 1973-74 | 41 | 24 | | 1974-75 | 45% | 26 | | 1975-76 | 46 | 27 | | 1976-77 | 44% | 26 |
47. On present expenditure plans and the illustrative assumptions on GDP growth made in paragraph 6, the ratios would tend downwards over the planning period—especially the general government goods and services ratio. The growth of transfer payments in the total is likely to keep the ratio of total public expenditure to GDP well above what it was in the early 1970s.
The economic context
48. In all industrialised countries the period since the oil price increases in late 1973 has been marked by high levels of unemployment and by rates of inflation which have remained high by previous standards. The persistence of inflation and, in many cases, the external financing problems created by the oil producers' surpluses have inhibited actions by governments to stimulate activity. Except in the United States, recovery from the recession has been hesitant and insufficient to stem the tide of rising unemployment. World trade has been depressed.
49. In spite of this, considerable progress was made in 1977 in carrying through the adaptation of the UK economy, and in particular in removing the financial imbalances that had proved so disruptive in 1976. The current account of the balance of payments moved into surplus, helped by the increasing flow of North Sea oil and an improvement in the terms of trade but also by a strong rise in the volume of exports. The rate of inflation decelerated. Confidence returned to the financial markets and was reflected both in lower interest rates and the strength of sterling.
50. In contrast to the financial indicators the real economy was sluggish. It became both feasible and desirable to give a stimulus to activity. In October the Chancellor of the Exchequer announced measures estimated to raise the rate of growth by about 1 per cent in 1978, to 3% per cent. He emphasised that attainment of this faster growth rate would depend on an average earnings rise in the current pay round consistent with the Government's guidelines, that is, not more than 10 per cent. Any faster rise in earnings would reduce growth by its adverse effects on confidence, interest rates and competitiveness.
51. The uncertainty over the future rate of inflation poses the major question mark over the medium-term prospects for the economy. A second uncertainty, partly linked with inflation, concerns the growth of productivity, and hence of the economy's productive potential. Over the 25 years or so up to the beginning of the recent recession the trend rate of growth of gross domestic product was 2% per cent a year. Over the past four years output has been virtually flat, and there has been almost no growth in recorded productivity. It is impossible to say how much of this absence of growth of productivity is cyclical—and so will be made good as output recovers—and how much it reflects a downward shift in the underlying growth of productivity. There are some grounds for thinking that the large changes in energy prices in 1973 and the low levels of investment in recent years may affect the future growth of productivity. This is an uncertain assumption, but, even allowing for the faster growth of labour supply and the contribution made by the rising output of North Sea oil, in the light of the available evidence it would be imprudent to count on a faster growth of productive potential than 3 per cent a year.
52. The economy, however, has excess capacity, which should permit for a period a rate of growth above that of productive potential. The extent of this slack, and the pace at which it can be taken up, are not easy to determine. The unemployed capacity—both labour and plant—is unevenly distributed, and there are physical constraints on the pace at which manufacturing output can grow without leading to over-heating in some sectors and a sharp worsening of the trade balance. It is essential to aim at a rate of growth that can be sustained over a number of years.
53. That rate of growth will be largely determined by developments in three areas—inflation, productivity and the growth of the world economy. On the last of these, concerted efforts are needed to raise demand and bring down unemployment in the industrialised countries; but the persisting problems of inflation and the OPEC surplus make it unlikely that action taken in the near future will be sufficient to return world trade to the growth rate seen on average in the decade before the oil price rise.
54. In this situation it is more than ever important for British industry to improve its competitiveness both by containing costs and by raising productivity. Only in this way can both high employment and an external current account surplus sufficient for our needs be achieved.
55. Provided inflation is contained and there is some recovery in world trade, the economy should be able to grow at above its past trend rate. But on present prospects a marked improvement in industrial performance would be necessary to sustain a growth rate above 3% per cent over the next few years. The aim must be to achieve such an improvement; but it cannot be assumed in advance as a basis for planning public expenditure. A growth rate of 3% per cent would be better than has been achieved on average since the war. But with the current degree of unemployment and the bonus of North Sea oil it would be disappointing if this were the limit. It should bring down unemployment, but the reduction would be gradual. Even growth of 3% per cent, however, cannot be taken for granted unless inflation is controlled.
56. Table 8 provides an illustrative projection of a pattern of demand that might be associated with a growth of 3% per cent in GDP and a growth of about 2 per cent in the volume of public expenditure on goods and services. Table 8 sets this out in a rather longer perspective, covering the decade before the oil price rise and the years of recession and adjustment after it. The changes shown for 1977–82 are not forecasts: they are simply intended to illustrate one possible pattern of expenditure that would be consistent with the assumed growth of output.
**Gross domestic output and expenditure**
| TABLE 8 (average annual % changes at 1970 prices) | |-----------------------------------------------| | 1964–73 | 1973–77 | 1977–82 | 1973–82 | | Consumers' expenditure | 2(\\frac{1}{2}) | -(\\frac{1}{2}) | 3(\\frac{1}{2}) | 1(\\frac{1}{2}) | | Public authorities' consumption | 2(\\frac{1}{2}) | 2(\\frac{1}{2}) | 2(\\frac{1}{2}) | 2(\\frac{1}{2}) | | Gross fixed investment | 3(\\frac{1}{2}) | -3(\\frac{1}{2}) | 7 | 2(\\frac{1}{2}) | | Increase in stock levels | 3 | 4(\\frac{1}{2}) | 3(\\frac{1}{2}) | 2(\\frac{1}{2}) | | Exports of goods and services | 6(\\frac{1}{2}) | 4(\\frac{1}{2}) | 7 | 5(\\frac{1}{2}) | | Total final expenditure | 3(\\frac{1}{2}) | 4(\\frac{1}{2}) | 4(\\frac{1}{2}) | 2(\\frac{1}{2}) | | Imports of goods and services | 6 | 1 | 8(\\frac{1}{2}) | 5(\\frac{1}{2}) | | Gross domestic product at market prices | 3 | 0 | 3(\\frac{1}{2}) | 2(\\frac{1}{2}) | | Gross domestic product at factor cost | 2(\\frac{1}{2}) | 0 | 3(\\frac{1}{2}) | 2(\\frac{1}{2}) |
1 Including consumption financed by public expenditure on transfers.
57. Table 8 brings out the contrast between the trends in the years before 1973 and developments in the past four years. Between 1973 and 1977 there was no change in output and real national disposable income fell by 2.3 per cent, reflecting the adverse movement in the terms of trade. Whereas public and personal consumption had been growing more or less in line in the earlier period, they diverged after 1973: personal consumption actually fell between 1973 and 1977 while public authorities consumption rose at an average annual rate of 2(\\frac{1}{2}) per cent. The fall in real take-home pay was even sharper than the fall in consumption, which was moderated by substantial increases in social security benefits. Total public expenditure, in cost terms, rose at an average rate of 0.0 per cent a year between 1973–74 and 1977–78. Investment, public and private, fell during the period. But there was a substantial improvement in the balance of payments—from a current account deficit of almost £1 billion in 1973 (and £3.5 billion in 1974) to a surplus in 1977.
58. Along with a satisfactory balance of payments, the first claim on higher output must be investment. A rise in the proportion of national income devoted to industrial investment is essential both for underpinning the faster growth rate assumed and more generally for increasing industrial efficiency and providing more employment.
59. After meeting these needs for industrial investment a 3(\\frac{1}{2}) per cent growth of output would provide more resources for public and private consumption and other investment than has been available in the past. On the illustrative projections above, a growth of 2 per cent a year in public expenditure on goods and services and the rise in transfer payments in the public expenditure plans would permit personal consumption to grow by around 3(\\frac{1}{2}) per cent a year. This would be considerably above the past trend, but would still leave the average increase in personal consumption in the years 1973–82 at under 2 per cent, compared with an average increase in public authorities’ consumption of 2½ per cent over the same period.
Revenue projections and general government balance
60. Table 9 gives projections of the revenue and expenditure, and of the financial balance and borrowing requirement, of general government for the first three years of the survey period. The projections relate to the borrowing requirement of general government (ie central and local government) rather than the more familiar concept of the public sector borrowing requirement, which also includes borrowing by nationalised industries and other public corporations from sources outside government. The definition of public expenditure in these White Papers is now close to that of general government expenditure. The figures in the table are on the basis used by the Central Statistical Office for general government receipts and expenditure, as published in “Financial Statistics”.
| TABLE 9 | £ billion at 1976–77 prices | |---------|-----------------------------| | | 1976–77 | 1977–78 | 1978–79 | 1979–80 | | Receipts | | | | | | 1 Taxes on income and expenditure... | 36.8 | 36.2 | 38.2 | 40.4 | | 2 Capital taxes | 0.9 | 0.8 | 0.7 | 0.7 | | 3 National insurance contributions(1) | 8.8 | 8.4 | 8.0 | 8.3 | | 4 Other receipts | 3.1 | 2.9 | 3.0 | 3.0 | | 5 Interest receipts | 2.4 | 2.6 | 2.6 | 2.4 | | Total receipts | ... | ... | ... | ... | | Expenditure | | | | | | 1 Expenditure on goods and services | 32.5 | 30.2 | 30.4 | 31.3 | | 2 Grants and subsidies(2) | 19.3 | 19.5 | 20.9 | 20.9 | | 3 Contingency reserve | ... | ... | ... | ... | | 4 Shortfall(3) | ... | ... | ... | ... | | 5 Interest payments | 5.7 | 5.8 | 5.9 | 5.6 | | Total expenditure | ... | ... | ... | ... | | Financial balance | -5.5 | -4.6 | -4.4 | -3.3 | | Net lending and miscellaneous capital receipts, etc | -1.8 | -0.9 | -1.0 | -1.0 | | General government borrowing requirement(4) | -7.3 | -5.5 | -5.4 | -4.3 |
1 Includes national health service and redundancy and maternity fund contributions. 2 Includes increase in book value of stocks. 3 See paragraph 63. 4 Minus sign indicates a borrowing requirement.
61. The projections for 1977–78 and 1978–79 are consistent with the forecasts for the public sector borrowing requirement published on 26 October. For 1979–80, they are based on the assumption that GDP will continue to grow at 3½ per cent and that private sector expenditure will be sufficient to produce a level of demand consistent with that growth rate. The figures for 1979–80 are thus not forecasts, but illustrations of what might be consistent with one assumption concerning the growth of GDP.
62. The figures of revenue for 1977–78 and 1978–79 are based on the existing tax rates and the levels of personal allowances announced by the Chancellor of the Exchequer on 26 October 1977. The projections for 1979–80 assume existing tax rates and an increase in personal allowances in line with the forecast rise in retail prices during 1978, following the provisions of the 1977 Finance Act.
63. The figures for public expenditure are based on current programmes, but a number of adjustments have been necessary to make the series consistent with the national accounts concepts used by the CSO. As the table shows the balance of receipts and expenditure, it is necessary also to make some allowance for the likelihood that, for the reasons explained in paragraphs 21–22 above, the outturn of expenditure programmes as a whole will fall somewhat below the planned level. Past experience shows that this kind of underspending varies considerably and cannot be closely predicted for any particular year. For 1977–78, the expenditure figures in this White Paper have already been revised downwards on this account. For 1978–79 and 1979–80, the allowance represents only a very broad judgment about the possible outcome, having regard to the experience of the previous two years, but assuming some improvement in the match between outturn and plans as a result of greater familiarity with the new control and monitoring systems.
64. As with the forecast published on 26 October the projections assume growth of average earnings at 10 per cent a year and an effective exchange rate index of 62½. Both expenditure and revenue are expressed at 1976–77 prices.
65. Forecasts of borrowing requirements are subject to a wide margin of error. The borrowing requirement is the difference between two large flows, and proportionately small changes in either can be large in relation to the borrowing requirement itself.
66. The projections show total tax revenue (at 1976–77 prices) declining in the current year, reflecting the changes in tax rates and allowances during 1977, but thereafter increasing faster than GDP. An important element in this rise is the growing volume of tax and royalty revenues arising from North Sea oil. These account for approximately £1·4 billion of the £4·1 billion projected rise in tax revenue between 1977–78 and 1979–80. The fall in the real value of social security contributions between 1976–77 and 1977–78 is largely accounted for by the movement of real earnings. For future years it has been assumed that the annual receipts and outgoings of the National Insurance Fund are roughly in balance.
67. Total general government receipts are projected to rise by about 8 per cent between 1977–78 and 1979–80, and total expenditure by 5 per cent. Thus, at unchanged tax rates, the general government borrowing requirement, at 1976–77 prices, is projected to fall through the period from about £5.5 billion in 1977–78 to about £4.5 billion in 1979–80.
Conclusion
68. An overall growth of public expenditure along the lines detailed in this White Paper should permit a sustained improvement in standards, while allowing at the same time a substantial growth in personal consumption after four years of no growth. The illustrative figure of 3½ per cent annual growth of gross domestic product used in the projections above is, it must be emphasised, not a prediction. If industrial performance improves it should be possible to sustain a faster growth than this. But, equally, a growth of 3½ per cent cannot be counted upon if inflation is not contained. There is now, thanks to North Sea oil and the adjustments carried out to the economy in the past year, an opportunity to move to a higher rate of growth than has been achieved for many years. But it is only an opportunity. To make it a reality is the major task now facing government, management and unions, and the nation as a whole. | Programme | 1972-73 | 1973-74 | 1974-75 | 1975-76 | 1976-77 | 1977-78 | 1978-79 | 1979-80 | 1980-81 | 1981-82 | |------------------------------------------------|---------|---------|---------|---------|---------|---------|---------|---------|---------|---------| | Defence | 6,451 | 6,370 | 6,123 | 6,445 | 6,361 | 6,255 | 6,289 | 6,494 | 6,660 | 6,660 | | Overseas aid and other overseas services | 1,185 | 1,235 | 1,183 | 1,008 | 1,188 | 1,351 | 1,722 | 1,860 | 1,958 | 1,962 | | Agriculture, fisheries, food and forestry | 881 | 997 | 1,950 | 1,761 | 1,133 | 866 | 706 | 654 | 649 | 642 | | Trade, industry and employment: | | | | | | | | | | | | Refinance of home shipbuilding and fixed rate export credit | 747 | 874 | 852 | 792 | 636 | 174 | 145 | -44 | -114 | -30 | | Other | 2,271 | 3,267 | 3,435 | 2,702 | 2,543 | 1,892 | 2,798 | 2,632 | 2,589 | 2,547 | | Government lending to nationalised industries | 2,085 | 364 | 1,116 | 1,347 | 330 | 420 | 1,350 | 1,550 | 1,350 | 1,100 | | Roads and transport | 2,516 | 2,719 | 3,079 | 3,173 | 2,784 | 2,590 | 2,563 | 2,583 | 2,572 | 2,554 | | Housing | 3,125 | 4,127 | 5,601 | 4,914 | 4,870 | 4,475 | 4,702 | 4,814 | 4,948 | 4,995 | | Other environmental services | 2,608 | 2,833 | 2,832 | 2,820 | 2,682 | 2,532 | 2,594 | 2,626 | 2,643 | 2,657 | | Law, order and protective services | 1,527 | 1,610 | 1,734 | 1,851 | 1,895 | 1,906 | 1,948 | 1,947 | 1,970 | 1,992 | | Education and libraries, science and arts | 7,600 | 8,090 | 8,156 | 8,319 | 8,293 | 8,010 | 8,102 | 8,143 | 8,205 | 8,255 | | Health and personal social services | 6,514 | 6,863 | 6,994 | 7,238 | 7,287 | 7,390 | 7,537 | 7,652 | 7,776 | 7,927 | | Social security | 10,675 | 10,674 | 11,368 | 12,309 | 12,717 | 13,226 | 14,063 | 14,172 | 14,458 | 14,602 | | Other public services | 982 | 740 | 804 | 888 | 848 | 844 | 854 | 865 | 865 | 883 | | Common services | 802 | 803 | 800 | 903 | 896 | 883 | 910 | 952 | 986 | 1,022 | | Northern Ireland | 1,397 | 1,468 | 1,676 | 1,725 | 1,737 | 1,741 | 1,815 | 1,811 | 1,796 | 1,808 | | Total programmes | 51,366 | 53,033 | 57,703 | 58,194 | 56,201 | 54,209 | 58,100 | 58,712 | 60,212 | 61,060 | | Contingency reserve | | | | | | | 750 | 1,500 | 1,750 | 2,000 | | Total | 51,366 | 53,033 | 57,703 | 58,194 | 56,201 | 54,209 | 58,100 | 58,712 | 60,212 | 61,060 | | Debt interest | 913 | 1,082 | 907 | 1,169 | 1,662 | 1,900 | 2,000 | 1,900 | 1,800 | 1,600 | | Total | 52,279 | 54,115 | 58,610 | 59,363 | 57,863 | 56,109 | 60,850 | 62,112 | 62,860 | 63,175 | | Total programmes, contingency reserve and over | | | | | | | | | | | | seas and market borrowing of nationalised indus | | | | | | | | | | | | tries | 51,603 | 54,427 | 58,742 | 59,079 | 57,635 | 54,739 | 58,550 | 59,612 | 60,860 | 61,325 |
1 Net of £559 million for proceeds of sale of shares in the British Petroleum Company.
### PUBLIC EXPENDITURE BY ECONOMIC CATEGORY AND IN TOTAL
#### TABLE 11 £ million at 1977 survey prices
| Year | 1972-73 | 1973-74 | 1974-75 | 1975-76 | 1976-77 | 1977-78 | 1978-79 | 1979-80 | 1980-81 | 1981-82 | |------------|---------|---------|---------|---------|---------|---------|---------|---------|---------|---------| | **Current expenditure** | | | | | | | | | | | | Wages and salaries | 15,325 | 15,932 | 16,683 | 17,409 | 17,643 | 17,762 | 18,004 | 18,142 | 18,258 | 18,416 | | Other current expenditure on goods and services | 8,886 | 9,148 | 9,363 | 9,555 | 9,333 | 9,411 | 9,529 | 9,801 | 10,088 | 10,169 | | Subsidies | 2,122 | 3,624 | 5,520 | 4,576 | 4,098 | 3,534 | 3,290 | 3,115 | 3,058 | 3,005 | | Current grants to persons | 11,641 | 11,641 | 12,295 | 13,358 | 13,888 | 14,650 | 15,602 | 16,155 | 16,345 | | | Current grants to private bodies | 859 | 939 | 995 | 1,059 | 1,092 | 976 | 1,047 | 1,053 | 1,059 | 1,080 | | Current grants abroad | 487 | 631 | 386 | 552 | 847 | 1,034 | 1,342 | 1,440 | 1,556 | 1,558 | | **Total excluding debt interest** | 39,320 | 41,916 | 45,241 | 46,509 | 46,901 | 47,366 | 48,812 | 49,348 | 50,175 | 50,573 | | **Capital expenditure** | | | | | | | | | | | | Gross domestic fixed capital formation | 6,450 | 7,115 | 6,909 | 7,014 | 6,296 | 5,116 | 5,363 | 5,420 | 5,435 | 5,462 | | Increase in value of stocks | 130 | 53 | 38 | 68 | 73 | 83 | 88 | 69 | 45 | 45 | | Capital grants | 1,513 | 1,585 | 1,442 | 1,265 | 1,378 | 1,396 | 1,556 | 1,541 | 1,546 | 1,560 | | Net lending to the private sector | 560 | 735 | 1,240 | 484 | 161 | 22 | 122 | 151 | 236 | 259 | | Net lending to nationalised industries and some other public corporations(1) | 2,129 | 452 | 1,230 | 1,424 | 552 | 727 | 1,737 | 1,897 | 1,678 | 1,419 | | Net lending to overseas governments | 301 | 236 | 179 | 120 | 96 | 10 | 81 | 74 | 74 | | | Drawings from United Kingdom subscriptions to international lending bodies | 66 | 93 | 130 | 157 | 119 | 142 | 167 | 200 | 200 | 200 | | Other net lending and investment abroad | 702 | 757 | 762 | 726 | 593 | -109 | 150 | -3 | -76 | -11 | | Cash expenditure on company securities (net) | 71 | 3 | 333 | 411 | 26 | -556 | 10 | 4 | -2 | -7 | | Capital transfers abroad | 126 | 89 | 199 | 16 | 6 | 10 | 13 | 12 | | | | **Total** | 12,047 | 11,118 | 12,462 | 11,686 | 9,300 | 6,843 | 9,288 | 9,365 | 9,136 | 9,002 | | **Contingency reserve** | | | | | | | 750 | 1,500 | 1,750 | 2,000 | | **Total** | 51,366 | 53,033 | 57,703 | 58,194 | 56,201 | 54,209 | 58,850 | 60,212 | 61,060 | 61,575 | | **Debt interest** | 913 | 1,082 | 907 | 1,169 | 1,662 | 1,900 | 2,000 | 1,900 | 1,800 | 1,600 | | **Total** | 52,279 | 54,115 | 58,610 | 59,363 | 57,863 | 56,109 | 60,850 | 62,112 | 62,860 | 63,175 |
1 The principal corporations other than nationalised industries are the National Enterprise Board and the Scottish and Welsh Development Agencies. A list is given in part 6. | | 1972-73 | 1973-74 | 1974-75 | 1975-76 | 1976-77 | 1977-78 | 1978-79 | 1979-80 | 1980-81 | 1981-82 | |------------------------------|---------|---------|---------|---------|---------|---------|---------|---------|---------|---------| | **Central government** | | | | | | | | | | | | Defence and overseas services| 7,599 | 7,559 | 7,272 | 7,418 | 7,527 | 7,589 | 7,983 | 8,324 | 8,589 | 8,592 | | Agriculture, fisheries, food and forestry | 884 | 986 | 1,935 | 1,747 | 1,126 | 859 | 698 | 646 | 641 | 634 | | Trade, industry and employment | 2,987 | 4,110 | 4,254 | 3,458 | 3,140 | 1,670 | 2,896 | 2,539 | 2,426 | 2,469 | | Government lending to nationalised industries | 2,085 | 364 | 1,116 | 1,347 | 330 | 420 | 1,350 | 1,279 | 1,305 | | | Roads and transport | 995 | 1,134 | 1,408 | 1,405 | 1,186 | 1,120 | 1,104 | 1,075 | 1,054 | | | Housing | 767 | 1,082 | 1,588 | 1,456 | 2,066 | 2,155 | 2,160 | 2,221 | 2,254 | | | Education and libraries, science and arts | 1,310 | 1,386 | 1,331 | 1,355 | 1,350 | 1,205 | 6,406 | 6,499 | 6,594 | 6,712 | | Health and personal social services | 5,695 | 5,905 | 5,990 | 6,124 | 6,191 | 6,287 | 14,063 | 14,174 | 14,602 | | | Social security | 10,675 | 10,674 | 11,369 | 12,309 | 12,717 | 13,226 | 13,458 | 14,458 | 14,602 | | | Other programmes including Northern Ireland | 3,048 | 3,045 | 3,437 | 3,660 | 3,613 | 3,614 | 3,746 | 3,776 | 3,848 | | | **Total programmes** | 36,046 | 36,244 | 39,661 | 40,280 | 39,245 | 38,126 | 41,660 | 41,982 | 42,419 | 42,569 | | **Local authorities** | | | | | | | | | | | | Roads and transport | 1,520 | 1,584 | 1,643 | 1,731 | 1,562 | 1,445 | 1,428 | 1,466 | 1,470 | 1,472 | | Housing | 2,240 | 2,838 | 3,653 | 3,104 | 2,524 | 2,135 | 2,314 | 2,417 | 2,446 | 2,457 | | Other environmental services | 1,767 | 1,916 | 2,062 | 2,034 | 1,965 | 1,825 | 1,888 | 1,912 | 1,961 | 1,974 | | Law, order and protective services | 1,195 | 1,249 | 1,330 | 1,413 | 1,454 | 1,455 | 1,474 | 1,475 | 1,487 | 1,501 | | Education and libraries, science and arts | 6,290 | 6,703 | 6,824 | 6,964 | 6,942 | 6,805 | 6,848 | 6,882 | 6,925 | 6,950 | | Personal social services | 819 | 958 | 1,044 | 1,113 | 1,096 | 1,103 | 1,132 | 1,152 | 1,183 | 1,215 | | Other programmes (Great Britain) | 102 | 122 | 149 | 161 | 148 | 158 | 161 | 165 | 165 | 164 | | Local authorities in Northern Ireland | 403 | 271 | 200 | 219 | 219 | 234 | 243 | 250 | 252 | 255 | | **Total programmes** | 14,336 | 15,642 | 16,904 | 16,739 | 15,910 | 15,161 | 15,488 | 15,718 | 15,889 | 15,990 | | **Certain public corporations(1)** | 985 | 1,147 | 1,138 | 1,176 | 1,047 | 922 | 952 | 1,012 | 1,002 | 1,015 | | **Total programmes** | 51,366 | 53,033 | 57,703 | 58,194 | 56,201 | 54,209 | 58,100 | 58,712 | 59,310 | 59,575 | | **Contingency reserve** | 51,366 | 53,033 | 57,703 | 58,194 | 56,201 | 54,209 | 58,100 | 58,712 | 59,310 | 59,575 | | **Total** | 51,366 | 53,033 | 57,703 | 58,194 | 56,201 | 54,209 | 58,100 | 58,712 | 59,310 | 59,575 | | Debt interest | 913 | 1,082 | 907 | 1,169 | 1,662 | 1,900 | 2,000 | 1,900 | 1,800 | 1,600 | | **Total** | 52,279 | 54,115 | 58,610 | 59,363 | 57,863 | 56,109 | 60,850 | 62,112 | 62,860 | 63,175 |
1 Corporations whose capital expenditure is included in public expenditure; mainly the water authorities and housing corporations. A list is given in part 6. | | 1972-73 | 1973-74 | 1974-75 | 1975-76 | 1976-77 | 1977-78 | 1978-79 | 1979-80 | 1980-81 | 1981-82 | |----------------------|---------|---------|---------|---------|---------|---------|---------|---------|---------|---------| | **Central government** | | | | | | | | | | | | **Current:** | | | | | | | | | | | | Goods and services | 15,137 | 15,396 | 15,659 | 16,253 | 16,187 | 16,381 | 16,626 | 16,946 | 17,261 | 17,428 | | Subsidies and grants | 14,493 | 16,058 | 18,115 | 18,376 | 18,789 | 18,946 | 20,024 | 20,105 | 20,489 | 20,624 | | **Capital:** | | | | | | | | | | | | Goods and services | 1,684 | 1,675 | 1,502 | 1,650 | 1,525 | 1,297 | 1,455 | 1,419 | 1,394 | 1,416 | | Grants | 1,285 | 1,281 | 1,204 | 1,129 | 1,247 | 1,233 | 1,319 | 1,293 | 1,296 | 1,311 | | Net lending to nationalised industries and some other public corporations | 2,129 | 452 | 1,230 | 1,424 | 552 | 727 | 1,737 | 1,897 | 1,678 | 1,419 | | Other net lending and capital transactions | 1,318 | 1,384 | 1,950 | 1,448 | 945 | -459 | 499 | 322 | 300 | 371 | | **Total excluding debt interest** | 36,046 | 36,244 | 39,661 | 40,280 | 39,244 | 38,126 | 41,660 | 41,982 | 42,419 | 42,570 | | **Local authorities** | | | | | | | | | | | | **Current:** | | | | | | | | | | | | Goods and services | 9,074 | 9,685 | 10,386 | 10,711 | 10,789 | 10,792 | 10,907 | 10,996 | 11,085 | 11,156 | | Subsidies and grants | 616 | 777 | 1,080 | 1,169 | 1,136 | 1,247 | 1,255 | 1,300 | 1,340 | 1,364 | | **Capital:** | | | | | | | | | | | | Goods and services | 4,017 | 4,476 | 4,498 | 4,403 | 3,874 | 3,012 | 3,127 | 3,192 | 3,218 | 3,214 | | Grants | 227 | 302 | 236 | 135 | 128 | 157 | 229 | 240 | 241 | 241 | | Net lending and other capital transactions | 402 | 402 | 704 | 321 | -16 | -47 | -30 | -11 | 5 | 14 | | **Total excluding debt interest** | 14,336 | 15,642 | 16,904 | 16,739 | 15,910 | 15,161 | 15,488 | 15,718 | 15,889 | 15,990 | | **Certain public corporations** | | | | | | | | | | | | **Capital:** | | | | | | | | | | | | Goods and services | 879 | 1,017 | 947 | 1,030 | 970 | 890 | 869 | 878 | 868 | 877 | | Grants | 1 | 2 | 2 | 2 | 4 | 6 | 8 | 8 | 8 | 8 | | Net lending and other capital transactions | 105 | 128 | 189 | 144 | 72 | 26 | 75 | 127 | 126 | 130 | | **Total** | 985 | 1,147 | 1,138 | 1,176 | 1,047 | 922 | 952 | 1,012 | 1,002 | 1,015 | | **Total expenditure on programmes** | 51,366 | 53,033 | 57,703 | 58,194 | 56,201 | 54,209 | 58,100 | 58,712 | 59,310 | 59,575 | | **Contingency reserve** | | | | | | | | | | | | **Total** | 51,366 | 53,033 | 57,703 | 58,194 | 56,201 | 54,209 | 58,100 | 58,712 | 59,310 | 59,575 | | **Debt interest** | 913 | 1,082 | 907 | 1,169 | 1,662 | 1,900 | 2,000 | 1,900 | 1,800 | 1,600 | | **Total** | 52,279 | 54,115 | 58,610 | 59,363 | 57,863 | 56,109 | 60,850 | 62,112 | 62,860 | 63,175 |
1 See note 1 to table 11.\
2 See note 2 to table 12.
## COMPARISON OF PLANNED EXPENDITURE AND ESTIMATED OUT TURN IN 1976-77 and 1977-78 BY SPENDING AUTHORITY AND ECONOMIC CATEGORY
### TABLE 14
| | 1976-77 | Percentage change | 1977-78 | Percentage change | |----------------------|---------|------------------|---------|------------------| | | Difference | | Difference | | | **Central government** | | | | | | Current: | | | | | | Goods and services | -557 | -3.3 | -148 | -0.9 | | Subsidies and grants | -317 | -1.7 | -68 | -0.4 | | Capital: | | | | | | Goods and services | -24 | -1.5 | -69 | -5.0 | | Grants | -71 | -5.4 | +5.6 | +4.7 | | Net lending to nationalised industries and some other public corporations(1) | -592 | -51.2 | -499 | -41.7 | | Other net lending and capital transactions | -168 | -15.2 | -649 | - | | **Total** | -1,729 | -4.2 | -1,377 | -1.6 | | **Local authorities** | | | | | | Current: | | | | | | Goods and services | -274 | -2.5 | -106 | -1.0 | | Subsidies and grants | -46 | -3.9 | -80 | -6.0 | | Capital: | | | | | | Goods and services | -61 | -1.6 | -84 | -2.7 | | Grants | -58 | -31.2 | -20 | -11.3 | | Net lending and other capital transactions | -62 | - | +65 | - | | **Total** | -501 | -3.1 | -225 | -1.5 | | **Certain public corporations(2)** | | | | | | Capital: | | | | | | Goods and services | -101 | -9.4 | -37 | -4.0 | | Grants | -3 | -4.4 | -36 | -6.0 | | Net lending and other capital transactions | -104 | -9.0 | -73 | -7.4 | | **Total** | -104 | -9.0 | -73 | -7.4 | | **Total expenditure on programmes** | -2,333 | -3.8 | -1,675 | -3.0 | | **Contingency reserve** | | | -750 | | | **Total** | | | -2,425 | -4.3 |
1 See note 1 to table 11. 2 See note 1 to table 12.
### SUMMARY OF CHANGES SINCE CMND 6721
**TABLE 15**
| Programme(1) | 1976-77 | 1977-78 | 1978-79 | 1979-80 | 1980-81 | |--------------|---------|---------|---------|---------|---------| | **A. March 1977 Budget measures** | | | | | | | Employment schemes(2) | 4 | +63 | +66 | +6 | +4 | | Inner cities (construction) | 8 | +14 | +74 | — | — | | Effect of tax changes on child benefit tax offset | 12 | +4 | +4 | +4 | +4 | | | | +81 | +144 | +10 | +8 | | **B. Statement of 25 May 1977** | | | | | | | 1977 uprating of social security benefits | 12 | +46 | +120 | +120 | +120 | | **C. Statement of 29 June 1977** | | | | | | | Employment measures | 4 | +6 | +131 | +200 | +198 | | Associated education expenditure | 10 | — | +4 | +12 | +18 | | | | +6 | +135 | +212 | +216 | | **D. Statement of 15 July 1977** | | | | | | | Milk subsidy | 3 | +134 | — | — | — | | Electricity discount scheme | 4 | +19 | +3 | — | — | | Extension of eligibility for free school meals | 10 | +17 | +29 | +32 | +29 | | Child benefit | 12 | +7 | +314 | +308 | +302 | | Construction | various | +93 | — | — | — | | | | +270 | +346 | +340 | +331 | | **E. Statement of 26 October 1977** | | | | | | | Construction | various | — | +369 | +200 | — | | Assistance to small firms | 2 | — | +20 | — | — | | Law and order | 4 | — | +2 | — | — | | Teachers in deprived areas | 9 | — | +10 | +11 | +11 | | Health authorities | 10 | — | +10 | +11 | +9 | | Local authorities personal social services | 11 | — | +12 | +12 | +12 | | Christmas bonus for pensioners | 12 | +97 | — | +6 | +6 | | Uprating of mobility allowance | 12 | — | +14 | +18 | +19 | | Effect of tax changes on child benefit tax offset | 12 | +3 | +14 | +14 | +14 | | | | +100 | +457 | +272 | +71 | | **F. Other announced changes** | | | | | | | Various | various | +7 | +108 | +154 | +148 | +138 | | **G. Other changes** | | | | | | | Various | various | −2,393 | −2,375 | +258 | −12(3) | +946(3) | | **H. Total changes to programmes** | | | | | | | | | −2,386 | −1,764 | +1,614 | +1,090(3) | +1,830(3) | | **I. Change to Contingency reserve** | | | | | | | | | — | −750 | −275 | n.a. | n.a. | | **J. Total change** | | | | | | | | | −2,386 | −2,514 | +1,339 | — | — | | **K. Change to debt interest** | | | | | | | | | −98 | −600 | −500 | — | — |
1 In addition to the programmes shown, many of these changes affect expenditure on programme 15—Northern Ireland. 2 Includes employment package announced on 3 March. 3 Excludes refinancing of home shipbuilding lending and fixed rate export credits and government lending to nationalised industries for which no estimates were published in Cmnd 6721.
### CHANGES TO EXPENDITURE PROGRAMMES SINCE CMND 6721
**Table 16**
| 1. Defence | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | Statement of 26 October: construction | | | | | | | | Other changes | | | | | | | | | | | | | | | | 1976–77 | 1977–78 | 1978–79 | 1979–80 | 1980–81 | | --- | --- | --- | --- | --- | | 170 | 71 | 4 | 50 | 122 | | 170 | 71 | 12 | 50 | 122 |
| 2. Overseas aid and other overseas services | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | Statement of 26 October | | | | | | | | Butter subsidy—EEC contribution (27 April) | | | | | | | | Other changes(2) | | | | | | | | | | | | | | | | 1976–77 | 1977–78 | 1978–79 | 1979–80 | 1980–81 | | --- | --- | --- | --- | --- | | 108 | 117 | 29 | 16 | 28 | | 108 | 168 | 47 | 16 | 28 |
| 3. Agriculture, fisheries, food and forestry | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | Statement of 15 July: milk subsidy | | | | | | | | Other announced changes: Pig subsidy (20 January) | | | | | | | | Private woodland grants (30 March) | | | | | | | | Butter subsidy (27 April) | | | | | | | | Potato support (5 October) | | | | | | | | Other changes(2) | | | | | | | | | | | | | | | | 1976–77 | 1977–78 | 1978–79 | 1979–80 | 1980–81 | | --- | --- | --- | --- | --- | | 16 | 251 | 128 | 84 | 80 |
| 4. Trade, industry and employment | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | March 1977 Budget measures: employment schemes(4) | | | | | | | | Statement of 29 June: employment measures | | | | | | | | Statement of 15 July: electricity discount scheme | | | | | | | | Statement of 26 October: Construction | | | | | | | | Assistance to small firms | | | | | | | | Other announced changes: Marathon: assistance with rig (22 December 1976) | | | | | | | | Redundancy Rebates Bill (7 February) | | | | | | | | Interim strategy for shipbuilding (24 February) | | | | | | | | Coal for Scottish power stations (12 March) | | | | | | | | Extension of Price Commission powers (1 April) | | | | | | | | Regrading assisted areas (14 April) | | | | | | | | Kirkby Manufacturing and Engineering Ltd (26 April) | | | | | | | | Rephasing of grants to Govan Shipbuilders (29 June) | | | | | | | | Instrumentation and automation industry (9 August) | | | | | | | | Energy conservation | | | | | | | | Other changes: Refinancing of home shipbuilding lending and fixed rate export credits | | | | | | | | Other | | | | | | | | | | | | | | | | 1976–77 | 1977–78 | 1978–79 | 1979–80 | 1980–81 | | --- | --- | --- | --- | --- | | 57 | 577 | 237 | n.a. | n.a. | | 357 | 332 | 58 | 137(4) | 126(4) | | 414 | 793 | 73 | 368(4) | 347(4) |
### CHANGES TO EXPENDITURE PROGRAMMES SINCE CMND 6721—continued
**TABLE 16 (continued) £ million at 1977 survey prices**
| 5. Government lending to nationalised industries | 1976-77 | 1977-78 | 1978-79 | 1979-80 | 1980-81 | |------------------------------------------------|---------|---------|---------|---------|---------| | 5. Government lending to nationalised industries | -587 | -440 | +319 | n.a.(t) | n.a.(t) |
| 6. Roads and transport | 1976-77 | 1977-78 | 1978-79 | 1979-80 | 1980-81 | |------------------------|---------|---------|---------|---------|---------| | Statement of 15 July: construction | ... | ... | ... | ... | ... | | Statement of 26 October: construction | ... | ... | ... | ... | ... | | Other announced changes: | ... | ... | ... | ... | ... | | Airport security (18 February) | ... | ... | ... | ... | ... | | IMCO building (26 October) | ... | ... | ... | ... | ... | | Other changes | -273 | -104 | +39 | +27 | +47 |
| 7. Housing | 1976-77 | 1977-78 | 1978-79 | 1979-80 | 1980-81 | |-------------|---------|---------|---------|---------|---------| | Statement of 15 July: construction | ... | ... | ... | ... | ... | | Statement of 16 October: construction | ... | ... | ... | ... | ... | | Other announced changes: | ... | ... | ... | ... | ... | | Housing improvements (2 May) | ... | ... | ... | ... | ... | | Local authority mortgage lending etc, Wales (20 June) | ... | ... | ... | ... | ... | | Local authority mortgage lending etc, Scotland (30 June) | ... | ... | ... | ... | ... | | National housing survey (6 July) | ... | ... | ... | ... | ... | | Additions offset by reductions in housing subsidies etc | ... | ... | ... | ... | ... | | Energy conservation | ... | ... | ... | ... | ... | | Other changes | -284 | -311 | -223 | -410(t) | -174(t) |
| 8. Other environmental services | 1976-77 | 1977-78 | 1978-79 | 1979-80 | 1980-81 | |-------------------------------|---------|---------|---------|---------|---------| | March 1977 Budget measures: inner cities construction | ... | ... | ... | ... | ... | | Statement of 15 July: construction | ... | ... | ... | ... | ... | | Statement of 16 October: construction | ... | ... | ... | ... | ... | | Other changes | -166 | -42 | +21 | -133 | -73 |
| 9. Law, order and protective services | 1976-77 | 1977-78 | 1978-79 | 1979-80 | 1980-81 | |--------------------------------------|---------|---------|---------|---------|---------| | Statement of 26 October: | ... | ... | ... | ... | ... | | Law and order measures | ... | ... | ... | ... | ... | | Construction | ... | ... | ... | ... | ... | | Other changes | -38 | -11 | +39 | +30 | +59 |
| 10. Education and libraries, science and arts | 1976-77 | 1977-78 | 1978-79 | 1979-80 | 1980-81 | |-----------------------------------------------|---------|---------|---------|---------|---------| | Statement of 29 June: Holland report—associated education expenditure | ... | ... | ... | ... | ... | | Statement of 15 July: | ... | ... | ... | ... | ... | | Extension of eligibility for free school meals | ... | ... | ... | ... | ... | | Construction | ... | ... | ... | ... | ... | | Statement of 26 October: | ... | ... | ... | ... | ... | | Teachers in deprived areas | ... | ... | ... | ... | ... | | Energy conservation | ... | ... | ... | ... | ... | | Other changes | -76 | -156 | +11 | +36 | +77 |
| 10. Education and libraries, science and arts | 1976-77 | 1977-78 | 1978-79 | 1979-80 | 1980-81 | |-----------------------------------------------|---------|---------|---------|---------|---------| | Statement of 29 June: Holland report—associated education expenditure | ... | ... | ... | ... | ... | | Statement of 15 July: | ... | ... | ... | ... | ... | | Extension of eligibility for free school meals | ... | ... | ... | ... | ... | | Construction | ... | ... | ... | ... | ... | | Statement of 26 October: | ... | ... | ... | ... | ... | | Teachers in deprived areas | ... | ... | ... | ... | ... | | Energy conservation | ... | ... | ... | ... | ... | | Other changes | -76 | -127 | +90 | +121 | +145 |
### CHANGES TO EXPENDITURE PROGRAMMES SINCE CMND 6721—continued
#### TABLE 16 (continued)
£ million at 1977 survey prices
| 11. Health and personal social services | 1976-77 | 1977-78 | 1978-79 | 1979-80 | 1980-81 | |----------------------------------------|---------|---------|---------|---------|---------| | Statement of 15 July: construction | | +15 | | | | | Statement of 26 October: | | | | | | | Health authorities | | | +12 | +12 | +12 | | Local authorities' personal social services | | | +6 | +6 | +6 | | Construction | | | +40 | +20 | | | Other announced changes: | | | | | | | Withdrawal of NHS road traffic accidents charges scheme (14 February) | | | +21 | +45 | +45 | | Energy conservation | | | +2 | +6 | +2 | | Other changes | | -72 | -1 | +6 | | | | | | | | +142 | | | | -72 | +35 | +111 | +89 | +207 |
| 12. Social security | | | | | | | March 1977 Budget measures: | | | | | | | Effect of tax changes on child benefit tax offset | | +4 | +4 | +4 | +4 | | Statement of 25 May: 1977 uprating of benefits | | +46 | +120 | +120 | +120 | | Statement of 15 July: child benefit | | +7 | +314 | +308 | +302 | | Statement of 26 October: | | | | | | | Christmas bonus for pensioners | | +97 | +14 | +18 | +19 | | Uprating of mobility allowance | | | | | | | Effect of tax changes on child benefit tax offset | | +3 | +14 | +14 | +14 | | Other announced changes: | | | | | | | Miscellaneous Provisions Bill (22 March) | | +11 | +15 | +15 | +15 | | Other changes | | -9 | -222 | +13 | +244 | +456 | | | | -9 | -54 | +494 | +723 | +930 |
| 13. Other public services | | | | | | | Statement of 26 October: construction | | | | | | | Other changes | | -33 | -15 | +2 | -4 | +2 | | | | -33 | -15 | +2 | +4 | +2 |
| 14. Common services | | | | | | | Statement of 26 October: construction | | | | | | | Other changes | | -43 | +11 | +22 | +8 | +19 | | | | -43 | +11 | +25 | +12 | +19 |
| 15. Northern Ireland | | | | | | | Announced changes: consequentials of changes to GB programmes | | +1 | +14 | +33 | +31 | +24 | | Other changes | | -98 | -23 | +35 | +28 | +37 | | | | -97 | -9 | +68 | +59 | +61 |
| Total changes to programmes | -2,386 | -1,764 | +1,614 | +1,090 | +1,830 |
______________________________________________________________________
1. Cmd 6721—1, paragraph 4, explained that the figures for 1979-80 and 1980-81 were even more provisional than usual, since they had not been further reviewed in the light of the developments which had led to the reductions in programmes for 1977-78 and 1978-79 announced on 15 December 1976. The changes for these years in this White Paper need to be read with this in mind.
2. Increased expenditure on market regulation under the common agricultural policy, partly offset by reductions in net EEC contributions.
3. Includes employment package announced on 3 March.
4. Excludes refinancing of home shipbuilding lending and fixed rate export credits for which comparable estimates were not published in Cmd 6721.
5. No comparable estimates published in Cmd 6721.
6. These changes are mainly due to changed forecasts of the need for housing subsidy (see part 2, chapter 7, paragraph 5).
7. See footnote 8 to table 14.
### CHANGES TO EXPENDITURE PROGRAMMES SINCE CMND 6721
#### BY ECONOMIC CATEGORY
**TABLE 17** £ million at 1977 survey prices
| | 1976–77 | 1977–78 | 1978–79 | 1979–80 | 1980–81 | |----------------------|---------|---------|---------|---------|---------| | **A. March 1977 Budget measures** | | | | | | | Current: goods and services | -4 | +3 | | | | | subsidies and grants | +63 | +67 | +10 | +8 | | | Capital: goods and services | +14 | +74 | | | | | | | | +81 | +144 | +10 | +8 | | **B. Statement of 25 May 1977** | | | | | | | Current: subsidies and grants | +46 | +120 | +120 | +120 | | | **C. Statement of 29 June 1977** | | | | | | | Current: goods and services | +1 | +7 | +14 | +17 | | | subsidies and grants | +5 | +127 | +193 | +191 | | | Capital: goods and services | | | +1 | +5 | +8 | | | | | +6 | +135 | +212 | +216 | | **D. Statement of 15 July 1977** | | | | | | | Current: goods and services | +18 | +29 | +32 | +29 | | | subsidies and grants | +161 | +317 | +308 | +302 | | | Capital: goods and services | +20 | | | | | | net lending and other capital transactions | | | +20 | | | | | | | +270 | +346 | +340 | +331 | | **E. Statement of 26 October 1977** | | | | | | | Current: goods and services | | | +42 | +27 | +22 | | subsidies and grants | +100 | +69 | +54 | +48 | | | Capital: goods and services | | | +332 | +189 | +1 | | grants | | | +14 | +2 | | | | | | +100 | +457 | +272 | +71 | | **F. Other announced changes** | | | | | | | Current: goods and services | +26 | +53 | +61 | +62 | | | subsidies and grants | +34 | +62 | +47 | +46 | | | Capital: goods and services | +34 | +24 | +36 | +32 | | | grants | +1 | +8 | +3 | +3 | | | net lending and other capital transactions | +13 | +7 | +1 | -5 | | | | +7 | +108 | +154 | +148 | +138 | | **G. Other changes** | | | | | | | Current: goods and services | -833 | -304 | +10 | +2 | +384 | | subsidies and grants | -369 | -484 | +106 | +331 | +585 | | Capital: goods and services | -186 | -293 | -7 | -371 | -142 | | grants | -129 | | -96 | -13 | -23 | | net lending to nationalised industries and some other public corporations | -643 | -510 | +319 | +43 | +50 | | Other net lending and capital transactions | -233 | -784 | -266 | -4 | +92 | | | -2,393 | -2,375 | +258 | -12(1) | +946(1) |
1 See footnote (\*) to table 15.
### TABLE 17—(continued)
| H. Summary of changes | £ million at 1977 survey prices | |-----------------------|--------------------------------| | | 1976–77 | 1977–78 | 1978–79 | 1979–80 | 1980–81 | | Current: | | | | | | | goods and services | −833 | −255 | +144 | +136 | +514 | | subsidies and grants | −362 | −75 | +868 | +1,063 | +1,300 | | Capital: | | | | | | | goods and services | −186 | −194 | +424 | −141 | −101 | | grants | −129 | +21 | +118 | −8 | −20 | | Net lending to nationalised industries and some other public corporations | −643 | −510 | +319 | +43 | +50 | | Other net lending and capital transactions | −233 | −751 | −259 | −3 | +87 | | | −2,386 | −1,764 | +1,614 | +1,090(1) | +1,830(1) |
1 See footnote (1) to table 15. CABINET
BENEFITS OF NORTH SEA OIL
Memorandum by the Chancellor of the Exchequer and the Secretary of State for Energy
1. We attach a discussion paper on the benefits of North Sea Oil along the lines of that presented to the Trades Union Congress Labour Party Liaison Committee, on Monday 21 November.
2. Colleagues may wish to consider the following questions which are set out in the paper -
i. How large and permanent are the benefits? ii. What are our objectives? iii. What is the overall strategy within which the oil revenues will be spent, short-term and long-term? iv. Should the revenues be hypothecated to an Oil Fund? v. How should the revenues be allocated? vi. What are the options? a. overseas investment? b. repayment of foreign debt? c. tax reductions? d. public services and social infrastructure? e. investment in manufacturing industry? f. investment in energy?
D W H
Treasury Chambers 12 December 1977 HOW SHOULD WE TAKE ADVANTAGE OF THE BENEFITS OF NORTH SEA OIL?
Paper by the Chancellor of the Exchequer and the Secretary of State for Energy.
North Sea oil will provide Britain with balance of payments gains and a new source of Government revenue. This paper sets out the probable size and duration of these direct benefits and considers how they should be used.
01. How large and permanent are the benefits?
02. The output of North Sea oil will amount to nearly half the nation's oil requirements during 1977 and should have eliminated our net oil import bill by 1980. If the real price of oil remains unchanged, the addition to GNP will be between £3 billion and £4 billion in 1980 (measured in 1976 prices) and around £5 billion in 1985 - figures equivalent to 3-5 per cent of our present GNP.
03. One major benefit of North Sea oil comes in the form of savings of foreign currency. Our underlying balance of payments position is likely to be improved as a result of the oil programme by about £5 billion in 1980, rising to £7-8 billion in 1985.
04. The other major benefit is that North Sea oil will provide a new source of revenue to the Government. Receipts will be small this year and next while investment costs are being recovered. But in 1979 the revenue is expected to reach over £1½ billion (at 1976 prices) and it will probably rise to at least £3½ billion a year in the mid-1980s.
05. On present evidence it seems likely that oil production will begin to fall off in the late 1980s, although it will continue at a diminishing rate through the 1990s. The size and timing of renewed dependence on oil imports will depend very much on future energy development. But benefits from North Sea oil as such, in particular Government revenues from oil production, will necessarily decline.
06. It is important to realise that even at the peak of production in the mid-1980s the direct benefits from North Sea oil will be modest in comparison with the size and needs of the economy as a whole. For example, oil revenues of about £3½ billion a year must be put in the perspective of total public sector revenue which is already some £50 billion a year and a present depressed level of investment in manufacturing industry which amounts to some £5 billion a year.
07. The size of the benefits each year after the early 1980s will depend to some extent on how far the Government delays depletion of North Sea oil fields in order to secure a more gradual rundown of production later on and thereby reduce the eventual need for imports of oil which might be very costly. But whatever conclusions are reached on control of depletion, oil production will certainly be high enough to provide approximate self-sufficiency throughout most of the 1980s.
08. A brief outline of the Government’s oil policy and factors influencing the size of the oil revenue is set out in the Appendix.
09. What are our objectives?
10. It is important to find ways of using the additional resources provided by North Sea oil which will enable us to achieve full employment, economic growth and rising living standards and maintain them not only while the oil is in flow but after it runs out.
11. This will only come about if the resources of North Sea oil are used as part of an overall economic strategy to ensure that expansion is sustainable over a long period. This strategy must involve public and private services as well as industry, provision of jobs as well as expansion of output and productivity, the needs of individual areas as well as those of national finance. and the balance of payments and it should provide for greater equality as well as economic growth.
12. More specifically we are concerned:
a. to raise living standards, reduce inflation and restore full employment in all parts of the United Kingdom - in particular in Scotland, Wales, Northern Ireland and English regions which have suffered most severely from industrial decline;
b. to ensure that full employment and high living standards can be maintained when the oil runs out.
12. These objectives have some immediate implications. To restore full employment a very large number of extra jobs, possibly as many as 2½ million, will be needed in the next decade and the majority of them must be in regions which have suffered from industrial decline. A proportion of these will be found in manufacturing industry; many will have to come from the expansion of public and private services of all kinds and in construction, transport and distribution. But such growth of services and other sectors will only be possible if there is at the same time a rapid and sustained increase in industrial production and productivity, involving reorganisation and re-equipment and retraining, in order to meet demand for manufactured goods without a large trade deficit.
13. North Sea oil will only provide modest assistance in making a start on the programme of economic and social reconstruction which is required. But if we are to adopt a coherent strategy the long-run objectives must be kept clearly in mind.
14. What is the overall strategy within which the oil revenues will be spent?
15. The economic strategy which accompanies the oil revenues will be as important as the revenues themselves. To be effective this economic strategy must take account of both immediate and medium term problems of managing the economy.
16. Now that the worst financial problems arising from the rise in world oil prices and the world recession have been overcome, the Government has taken steps to start the economy moving ahead even before North Sea revenues begin to be available on a substantial scale.
17. The immediate purposes are a controlled expansion of production, to continue reducing inflation and to start improving living standards and public services. Co-operation between the trade union movement and the Government has been a major reason for success in correcting the financial situation and reducing inflation so far. With the return to more normal collective bargaining and following a period when living standards have been squeezed, there are great pressures to improve take-home pay by increasing money wages.
18. The Government has now been able to start reducing the burden of taxation and this, together with productivity increases as production expands, should make it possible for the real take-home pay for working people to increase without needing large money wage rises which would set off a renewed spiral of inflation. Reduction of taxation, the revival of investment and public spending and the growth of exports will all help to expand demand and bring about growth of production in the coming year.
19. The approach to a longer-term strategy has been discussed by the Government, the TUC and the Labour Party and some conclusions were set out in the "The Next Three Years", expressing a joint commitment to sustained expansion of the economy with adequate planning machinery, recognising that this cannot be left entirely to market forces.
20. The performance of our manufacturing industry since the war has not kept pace with that of our competitors. Our share of world trade in manufactured goods has fallen from 25 per cent in 1950 and 16 per cent in 1960 to about 9 per cent now, although it has risen slightly in recent months. Because of our poor trading performance we have been unable to raise the overall growth rate of the economy and have had to cut out plans for public expenditure. The consequence has been a fall in industrial confidence, investment and employment and the postponement of cherished social programmes.
21. There are a number of problems affecting prospects for achieving high investment, full employment and a sustained growth in social spending, which include inflation, world wide recession and the rapid increase in domestic labour supply.
22. Any strategy for using the benefits of North Sea oil to promote sustained economic recovery in Britain must therefore ensure that the oil revenues are used in expanding home production and employment. Creation of confidence in a steadily growing home market is a necessary but not a sufficient condition for this. We cannot rest our fate on the assumption that private industries, uncoordinated, will respond satisfactorily if left to themselves.
23. The programme of planned reconstruction will necessitate investment of public funds accountable to Parliament and the development of industrial democracy. Public agencies such as the NEB and the Development Agencies will have a large role to play in expanding investment, particularly in projects which aim to modernise and expand industry in declining areas and to improve the industrial infrastructure. The nationalised industries will have to carry out a great deal of productive investment. Company investment should be coordinated by Planning Agreements and the industrial strategy and supported by Industry Act assistance. Investment Reserve Funds built up from retained profits have been advocated as a mechanism for doing this.
24. Planning must also extend to the service sector and to assistance for small scale industry, with a significant role for the Co-operative Development Agency and local authorities.
25. Should the revenues be hypothecated to an Oil Fund?
26. An important preliminary question is whether North Sea oil revenues should be separately and specifically allocated through an Oil Fund, or whether they should be absorbed into public funds as a whole. The arguments in favour of such an Oil Fund are -
a. that use of the revenue would be visible and accountable, helping to ensure that they were not frittered away and enabling the public to assess the priorities which were proposed or being followed;
b. that continuing public discussion about what is inevitably seen as a precious national asset will be facilitated;
c. that it will demonstrate the Government's determination to use the revenues wisely and well and will be a protection against accusations that they have been wasted.
25. The arguments against hypothecating oil revenues in a special fund are -
a. that it might provoke disputes on special claims;
b. that the establishment of a fund could not in itself show how the revenues were being used on the grounds that there would be no way of demonstrating that the expenditure or tax reductions which the fund financed were additional to what would have been done in any case. For example it means little to say that the oil revenues are directed exclusively to financing one particular activity if that activity would otherwise have been financed out of general revenues and the hypothecation of oil revenue to it made it possible to spend the same amount of general revenues on other activities. c. that a fund would increase pressures to use all the revenue on extra spending, as against using some for a reduction of taxes which might have a higher priority;
d. that it would reduce the flexibility a government needs in managing the economy and divert attention from the thrust of economic policy as a whole on which political opinion should concentrate.
5. How should the revenue be allocated?
6. Whether or not the revenues are allocated through an Oil Fund, they will constitute a substantial extra source of finance. Choices must be made about how they are to be spent and about how to take advantage of the related balance of payments savings. Public discussion is already focussing on this issue.
7. The broad options for allocation include:
a. overseas investment, b. repayment of foreign debt, c. tax reductions, d. public services and social infrastructure, e. investment in manufacturing industry, f. investment in energy.
The revenues are by no means large enough to have a significant impact on all of these simultaneously, although the hypothecation of revenue to any one option would leave more money available from general revenues to finance other options.
28. But there are two broad views on how we should proceed. One is that the relative priority attached to each option may alter through time, will depend on the economic and policy environment and hence cannot be foreseen in detail now; it would therefore not be wise to narrow down the options at this stage. On this view some options are linked (eg manufacturing investment can be encouraged by increased consumption following tax reductions, and by public expenditure on infrastructure). The other views is that the revenues, which at their maximum will probably amount to only £3½ billion per year, are not large enough to finance more than two of these options on a significant scale, that commitment to any two would necessarily preclude spending on others, and that the choice of options, once made, should be expected to endure.
29. Although the first two options have to be paid for our of balance of payments savings, these balance of payments savings from oil may, other things being equal, only be available for these purposes if oil revenues are not spent, but are used to reduce the PSBR. In other words, oil revenues may have to be allocated to these options. It may therefore be necessary to choose between these and other options as ways of spending the oil revenue. In the same way, to provide resources for extra private investment, whether at home or overseas, would require allocating oil revenue for that purpose and would mean that less was available for the public sector to spend.
30. What are the options?
a. Overseas investment
30. It would be possible to use the oil revenues to reduce Government borrowing and thereby secure a larger balance of payments surplus. Exchange controls could then be relaxed or abolished so that private individuals, companies and financial institutions could buy foreign bonds, shares, property or other overseas assets. Some would argue that investment abroad would provide Britain with a continuing income after the oil runs out, and might reduce upward pressure on the exchange rate which makes British industry less competitive.
31. Others argue that using the oil benefits for overseas investment would pre-empt using them to expand the economy more quickly, reducing unemployment and encouraging investment at home. It is debateable how far investment by UK forms overseas is a substitute for investment in the UK, but with unemployment high the relevant test of which we should prefer is not simply relative profitability to the firm, but total value added in the UK versus post-tax profits overseas. If we were trying to run a high current account surplus, simply to finance overseas investment on capital account, this might also tend to make sterling overvalued, thus damaging the competitiveness of British industry.
b. Repayment of foreign debt
32. Britain has $22 billion of external debts of which $20 billion are due for repayment between now and 1984. The choice is not whether to repay the outstanding loans on the due dates - there is of course a legal obligation to do so - but how far to finance these arrangements by new overseas borrowing.
33. There are three potential sources from which the repayment of foreign debt might come: the foreign currency reserves, a surplus on the balance of payments or further loans from abroad. The question is whether part of this debt should be repaid from the oil revenues.
34. The arguments in favour of making a start with reducing the total of our outstanding debts are that at a time of economic weakness the UK was able to borrow money on the strength of expected revenues from North Sea oil. It would be unwise to rely on the reserves to repay debt as in the past inadequate reserves made us too vulnerable to events outside our control. Moreover some of the reserves are short-term funds which it would be imprudent to use to repay long-term debt.
35. If we are to spread the burden of debt repayment by raising new loans, this will require a satisfactory overall balance of payments. As Britain's economic performance strengthens there should be scope for raising new loans in this way. Potential creditors will be interested in the prospects for the yield of North Sea oil because it is this source of income in particular which provides assurances that loans will eventually be repaid. We should ensure that we do not put at risk international credit worthiness: a Government forced to concentrate on remedying financial difficulties is unlikely to be able at the same time to give priority to domestic policies to restructure industry.
36. In order to decide how much of the debt repayment should be financed from new overseas borrowing, and how much from balance of payments surpluses, consideration would have to be given to the pattern of debt repayment over the whole period. This would have to be calculated to leave maximum scope for domestic growth and industrial competitiveness.
37. It is argued, on the other hand, that we should not use oil revenue to repay debt on the grounds that it would diminish the revenue available for expansion of our own economy, that net repayment may not be necessary since the funds of OPEC and other surplus countries will have to be recycled for many years to come, and that if some net repayment of debt should prove necessary after all, room for this should be found by general economies, not by cutting down on uses planned for oil funds.
c. Tax reductions
38. The Government's immediate policy of reducing the burden of taxation on working people, before the oil revenues have built up, has already been noted. There is a longer-term question whether oil revenues should be used to finance a significant further reduction in taxation. It is argued on the one hand that following a period when living standards have had to be squeezed there are great pressures to improve take home pay by increasing money wages. North Sea oil provides some scope for reducing the burden of taxation so that the real take home pay of working people can be increased without inflationary rises in money wages which raise industry's unit costs and are inevitably reflected in higher prices and fewer jobs.
39. Other reasons are also suggested for reducing direct taxation with the help of oil revenues. In 1960/61, a married man has to be earning 40 per cent of the average wage before paying tax, the same man now has to earn only 35 per cent before paying tax. The Government has taken steps to raise tax thresholds and the TUC has indicated it seeks further progress on this front as well as giving a priority to the introduction of a reduced rate band. Such measures are costly and unless a proportion of the benefits from North Sea oil are used are likely to be unattainable.
40. Against, it is argued that using oil revenues for long-term tax cuts would pre-empt funds for public services and benefits, creating a divided and unequal society with poverty for the unemployed, elderly and sick and great wealth for successful businessmen and managers; that it would do little for declining regions; and that it would provide a consumer-led boom for German and Japanese suppliers without providing much help to hard-pressed British industries. On the other hand any attempt to reduce inequality by increasing social payments would have much the same effect on imports and the regions as cuts in income tax.
41. But the restructuring of benefits and taxation would be an important consequence and benefits if the oil revenues themselves were used for economic recovery.
d. Public services and social infrastructure
42. Oil revenues could be used to finance substantial new public spending, restoring services and construction which have had to be cut in the recession. This would provide extra employment; it may therefore be an essential counterpart of industrial investment and reorganisation which might not itself substantially increase jobs in manufacturing. Using oil revenues for public expenditure will also expand the economy and raise consumption by providing extra employment.
43. As the economy expands and ordinary tax revenues increase, a portion of the oil revenue might be set aside to initiate new programmes will need to keep pace with the expansion of the economy.
f. Investment in energy
49. Major efforts will be needed to secure Britain's energy position after the oil runs out, including conservation measures, more efficient conversions of primary fuels into usable forms of energy, and development of new sources of primary fuel supply. At present substantial research and public investment is already being undertaken in all these fields. Although the overall build-up of investment expenditure may be gradual, it is likely that after the mid-1980s a high level of expenditure will be needed to meet growth of the economy and to adapt to the post-oil era.
50. Investment in the North Sea itself is already funded through allowances deducted before the main oil taxes are charged. There may be a case for allocating some of the oil revenue to finance other forms of energy investment, particularly if the investment programme has to be accelerated in the late 1980s. SECURING THE MAXIMUM BENEFITS FROM UKCS OIL
51. Since 1974 the Government has carried through a comprehensive programme of measures designed to maximise the benefits accruing to the state from UKCS oil. This has involved a judicious mix of new controls, taxation and stimuli. A balance has been achieved which encourages further investment - there were 133 applicants for 51 blocks in the 5th licensing round and a series of companies successfully concluded new field financing arrangements in 1975/76 - while substantially increasing direct state involvement, the state share of the financial benefits and the extent of state authority over offshore and onshore operations and the oil produced.
52. Taxation
Government take from offshore oil is made up of
1. royalty at 12½% of the value of the oil;
2. Petroleum Revenue Tax (PRT) at 45% on profits before Corporation tax;
3. Corporation tax on net revenue after deduction of royalty, PRT and expenses.
The Oil Taxation Act 1975 introduced PRT. PRT applies to each field separately so that the tax on the profits on one field cannot be deferred by offsetting against it the costs of another field. Safeguards are incorporated to provide for an adequate return on marginal fields. The Corporation tax yield from the North Sea is protected by the erection of a "ring fence" round UKCS activities for tax purposes. Together these three taxes should secure on average some 70% of the profits derived from UKCS operations: where BNOC has a 51% equity interest the overall return to the state should rise to some 85%. 3. Direct State Involvement
A further financial return to the state is provided for by the creation of the British National Oil Corporation (BNOC) with a right to a 51% equity stake in all licenses from the 5th Round onwards. The Corporation raised $825m in 1976 by the forward sale of oil without prejudicing control over the disposal of that oil.
BNOC is also involved, through negotiated participation agreements, in the operation of commercial oilfields licenced under previous rounds. The Corporation is building up knowledge of UKCS operations at first hand in support of its advisory role to Government.
4. Direct Access to Oil
The Petroleum and Submarine Pipelines Act 1975 (PSPA) provided the Secretary of State with a right to take in kind the 12½% royalty on production. Together with BNOC's substantial equity and participation rights, this will provide the state with direct access to some 40-45m tons of oil in 1980 and hence with control over its disposal not available by other means because of international obligations.
5. Regulations
The PSPA tightened controls over exploration and over the manner and timing of development and production of discoveries. It provided the Government with the means to implement policy on the rate at which reserves should be depleted. Government consent is required for gas flaring and for the construction and operation of submarine pipelines. The construction and extension of refineries also requires Government consent, apart from normal planning procedures. 6. **Guidance**
A Government statement in 1974 said that up to two-thirds of the oil UKCS produced could be expected to be refined in the UK, subject to the level of production and the way in which world markets developed. Participation agreements provide for wide-ranging consultation between producers and the Department of Energy, advised by BNOC, permitting, amongst other things, the monitoring of disposal policies and pricing.
7. **Stimuli**
The Offshore Supplies Office has been created to stimulate the maximum UK industrial contribution to offshore activities. A memorandum of understanding, securing for UK industry a full and fair opportunity to compete for offshore business, was concluded with the Offshore operators in 1975. The UK share of the offshore supplies market has increased from 40% in 1974 to 57% in 1976.
The Government has been prepared to give assurances about the manner in which its regulatory powers will be used, in order to ensure confidence in investment in UKCS operations. Assurances about use of the new powers to control rates of depletion were given in 1974 and contractual undertakings have been given to certain banks. Power has been taken to refund royalties in order to stimulate or sustain production from a field which would not otherwise satisfy normal commercial criteria.
The Government has been instrumental in the creation of a joint public sector/private sector study company, Gas Gathering Pipelines (North Sea) Ltd, to finance and execute detailed evaluation of the economic case for a gas gathering system in the Northern North Sea. 8. Possible Hazards to Realisation of Fuel Benefits
The timing of the realisation of UKCS oil benefits could be affected by many factors including, notably, a fall in the world oil price but also the imposition of restrictions following a major pollution disaster or a sudden and differential surge in the costs of exploitation of the UKCS. But the forecast increase in the real cost of oil in the long term, if right, means that such benefits will be deferred rather than lost. There is a constant balance to be struck between, on the one hand, maintaining sufficient incentive to the private sector to ensure an adequate scale of exploration and of commitments by oil companies and financial institutions to new developments at the controlled rate calculated to maximise benefits and, on the other, increasing progressively the direct state share in the benefits, for example through an enhanced role for BNOC in future licensing and through tax changes. CABINET
THE PAY SCENE
Memorandum by the Chancellor of the Exchequer
1. This is an appropriate moment to take stock of our pay policy in the current round. By taking firm action from August to October on proposals for excessive settlements, mainly in the private sector, we removed the immediate prospect of a wage explosion. As a result, with the help of the Trades Union Congress' (TUC's) agreement on the 12 month rule and self-financing productivity deals, almost all Stage 2 settlements have now been satisfactorily concluded. The 12 month rule is holding. Since October, we have successfully completed the critical negotiation with the local authority manuals, which is likely to set the pattern for many settlements in the public sector, and have faced the special cases of the police and firemen. The settlement with the local authority manuals will greatly reinforce the authority of the policy for the present round.
2. There is growing evidence that the Government's pay policy has overwhelming public support. But there are some large and important negotiations ahead from February to April. Moreover, we must begin to think about the longer term. In particular, some aspects of current negotiations may compel us to formulate an agreed policy for the public sector in the next round well before the end of the current round.
THE SHAPE OF THE CURRENT ROUND
3. The main features of the round so far are as follows:
a. There has been much less flexibility between settlements than originally hoped. Because very few groups have been prepared to settle for an earnings increase significantly below 10 per cent the Government has been compelled to oppose settlements significantly above 10 per cent. Nevertheless opportunities are being taken to widen differentials within settlements by giving unskilled workers a little less than 10 per cent and the minority of skilled workers a few percentage points more. b. Productivity deals are adding perhaps 1 per cent or 2 per cent to the average level of settlements. They are providing a useful flexibility in many cases. Although they may not all be genuinely self-financing, they are probably generating some genuine improvements in productivity. It is proving very difficult for us to discover, evaluate and monitor all such deals although we must continue to do our best to do so.
4. The prospects for the rest of the round include the following features:
a. An appraisal by officials of the 50 or so main negotiations over the next four months concludes that there is a real chance of settling every individual case at or around 10 per cent, provided that the line can be held generally elsewhere, but that any major breach of the guidelines would have a disastrous domino effect.
b. Forward commitments are a potential source of trouble: they have been accepted explicitly for firemen and implicitly for the police. Officials are preparing a study of cases where forward commitments may be demanded and will make recommendations on handling the problem. Such demands may arise from the recommendations of the Review Boards for the Armed Forces, doctors and dentists and top salaries, as well as from claims by university teachers and from the analogous pay research problem of the non-industrial Civil Service. It will be necessary to limit forward commitments to the absolute minimum unless they are to create formidable difficulties for policy in the public sector as a whole during the next round. This is perhaps the main factor which may compel us to formulate a comprehensive policy for the public sector in the next round by early summer next year.
c. Wage drift may be somewhat less this round partly because of the greater flexibility and partly because in areas of the public sector overtime is as likely to fall as to increase, and many private employers cannot afford to fiddle on a large scale.
THE NEXT FEW MONTHS
5. In the immediate future we still risk serious trouble over oil tanker drivers, and there could be others. Following the settlement of local authority manuals, we must get the same pattern adopted in the related cases of National Health Service ancillaries, water and gas manuals, and clinch the deal with firemen without further concessions. But two groups of future settlements stand out in importance:
a. Power workers in the gas, electricity and coal industries could quickly bring the economy to a halt. It is particularly difficult to assess the prospects, timing and interrelationships of their negotiations. Much will depend on the climate which is built up before any crunch comes. b. **Public services:** A large proportion of white-collar public services is due to settle in April, with some very strong linkages between different groups within the total. These include most of the candidates for forward commitments. Quite apart from any damage which could be done through failure to reach agreement in individual negotiations, if we show weakness in managing these groups we would risk reopening satisfactory settlements achieved in earlier months. By the same token, if we are successful in settlements with earlier groups, particularly the power workers, we will find it much easier to settle with the white-collar public services.
6. There are three areas of action to which the Ministerial Committee on Economic Strategy Sub-Committee on Pay Negotiations (EY(P)) attaches particular importance:
a. Although public opinion is solidly behind the Government there is still the impression in some quarters that the current round represents another year of sacrifice. In fact, living standards have been increasing since the summer and will continue to increase throughout the round if settlements are within the guidelines, even without further tax cuts in the spring Budget. This fact should be rammed home in speeches by Ministers and general Government publicity.
b. Contingency plans for dealing with industrial action have been prepared, and are being implemented where appropriate (for example adequate stocks are being built up at the right locations). There are however limitations on the ability of the Armed Forces to handle two or more contingencies at the same time. This makes it particularly important not to use the Armed Forces except where the risk to life or national interest plainly requires it.
c. Ad hoc official groups are being set up to keep track of the prospects and developments on the power groups - and later the public services. Ministers will be advised on steps which might be taken - or should be avoided - before and during negotiations.
**AFTER PHASE THREE**
07. If we persevere in seeking to influence individual settlements there is now a good chance that the current policy will not only avoid a wage explosion but also achieve an earnings outturn compatible with single figure inflation in 1978. But this will be at the cost of greater rigidity than we would have wished and of at least a few damaging forward commitments. It is difficult to feel confident that we could return to full freedom of collective bargaining in the next round without risking an increase in wage costs which would raise both prices and unemployment. Moreover there is a growing feeling in the Labour movement itself that total freedom in collective bargaining is incompatible with both social justice and economic efficiency.
08. There are special reasons for believing that we are moving into a period in which some sort of pay policy will be not only more necessary than at most times in the past but also more feasible.
09. The central problem of our economy for more than a generation has been that, although our productivity has grown more slowly than that of our competitors, we have seen annual wage increases of the same order as theirs. So our inflation has risen faster than in other countries and we have been able to maintain price competitiveness and full employment only by a series of devaluations which have further added to inflation and increased the pressure for excessive wage increases. In the era of North Sea oil it will be more difficult to devalue our currency to maintain price competitiveness. So unless we can keep wage increases close to the level of productivity increase we shall face rising unemployment and a further erosion of our industrial base.
10. It is the aim of our industrial strategy to increase the trend ingrowth of productivity. But we are likely also to need a policy which will help to keep the increase in our wage costs close to whatever growth in productivity we do achieve. Otherwise we risk finding that North Sea oil simply produces rising living standards allied to rising unemployment, followed by a major political and economic crisis when the oil runs out, because we have lost the industrial capacity to earn such high living standards without the oil. This is why pay policy is likely to be more and not less necessary in the period ahead.
11. On the other hand there is now a better understanding than ever before among all sections of our people that high inflation is not only a major social evil but is also incompatible with high employment. Trade unionists are tired of being paid in confetti money. The current dramatic fall in our inflation rate is rightly seen as mainly due to moderation in pay settlements. So there is a better chance than ever before of getting support for a continuing policy to discourage excessive pay increases.
12. The need for such a policy in the public sector is inescapable and has been recognised recently by the leaders of public sector unions like Mr David Basnett and Mr Geoffrey Drain. Forward commitments already accepted in the public sector make this more necessary still. But it would be difficult to operate a pay policy successfully in the public sector if freedom is exercised irresponsibly in the private sector. In the private sector, however, and to a lesser degree in the public sector too the rigidity of pay policy over the last three years has produced damaging distortions. The problem is not only the excessive compression of existing differentials but also the difficulty of changing differentials which are incompatible with economic need. For example, the widespread shortage of skilled labour at present seems due less to the absence of the necessary skills than to the unwillingness of those with the skills to accept jobs which pay them less than they can earn elsewhere.
13. It is not too early for us to consider finding an answer to these problems. The remaining seven months of the current pay round will not be too long. We already know that if we are to get our inflation rate down to that of our international competitors and keep it there we shall have to achieve an earnings outturn in the next round which is not significantly higher than our trend growth in productivity which is still well below 5 per cent.
14. It would be worth exploring with Mr Basnett and other leaders of unions in the public sector how we could hope to achieve such an outturn in the public sector as a whole, and how to approach demands for forward commitments in the light of this.
15. At the appropriate time we should also approach the TUC more generally about the role of pay policy in the strategy on which we fight the next Election, and about the contribution they might be prepared to make. We should seek to persuade them, for example, to reaffirm the 12 month rule while making some provision for synchro-pay in areas like British Leyland where this is likely to conduce to better industrial relations and to accept the inevitability of some forward commitments without treating them as a general base for all new claims.
16. I put these ideas forward for discussion in a tentative spirit, since I am unclear myself about how best to proceed. But I am convinced by our experience over the last three years that a more rational approach to pay policy is both necessary and possible in the longer run, and that we must begin to face the implications of this now.
D W H
Treasury Chambers
20 December 1977 CABINET
A NATIONAL DEVELOPMENT PROGRAMME
Memorandum by the Secretary of State for Energy
1. This paper argues that it should now be our objective to re-examine with the Trades Union Congress (TUC) a wide range of policies that go beyond the 12 month rule and pay. If the Government has to rely on the control of pay as its central policy, it will be consistently weakened in the run-up to the Election.
THE BACKGROUND
2. The Government faces two threats to its support. One arises from continuing unemployment and public sector pay restraints, the other from the risk that the Government may progressively lose its ability to hold the loyalty of the unions and their members without confrontation.
3. The greatest weakness facing both the Government and trade union leaders is that now, after two-and-a-half years of wage restraint, cuts in living standards, cuts in public expenditure and high unemployment cannot be quickly reversed. The prolonged world slump, industrial closures, lack of investment, and continuing cutbacks in public services have combined to remove the credibility of our pledge of a phased return to full employment. Those who have accepted real cuts in living standards are now faced with further wage restraint, plus long dole queues and public services under strain. A long slump of this magnitude damages the social fabric and cannot in the end be accepted by trade unions and the Labour movement.
PAY PROBLEMS
4. The risk of confrontation over pay is growing because our commitment last July to "an orderly return to collective bargaining" and a policy based on "good sense and realism" has become transformed into a rigid 10 per cent policy in the public sector and an ineffective attempt to use sanctions to prevent higher settlements in the private sector. As private sector earnings move ahead, workers in the public sector feel that they are being discriminated against. In seeking to hold the line against firemen or other groups in the public sector we are faced with a choice of evils. If we enforce the ceiling strictly, we do so at the cost of alienating those who looked to a Labour Government to defend them; the tactics for winning each 10 per cent battle force us to mobilise public opinion against successive groups of public employees which must embitter those against whom we are in conflict. But if we seek to win by gentler persuasion, public opinion may side with the workers concerned, against the Government.
5. If we were to slip into a head-on clash with a powerful section of workers we could find ourselves saddled with the "Who Governs Britain?" dilemma which brought Heath down. Since the Labour Government's strongest point with the public was - and remains - our claim that we could work with the unions and their members, a collapse of that approach would prove to be our downfall and pave the way for electoral defeat and a Conservative Government.
THE NEED FOR A NEW PROGRAMME
6. It must be our prime objective to restore our relationship with the Labour movement by re-examining, with the TUC, a wide range of present policies that go far beyond pay. The new context for these policies is the run-up to an Election and the opportunities provided for the 1980s by North Sea oil.
7. The new programme must help us and trade union leaders to resolve the outstanding problems over public sector pay. It must provide real hope for national recovery. And it must provide a new orientation towards international problems so that we can gain acceptance for measures we need to take.
THE INTERNATIONAL CONTEXT
8. We must press extremely hard for constructive and definitive international measures to deal with the slump, if for no other reason than to justify continuing or new defensive measures that we may have to take unilaterally if the international context does not improve. In particular we should urge:-
a. Trade guidelines with an element of restraint on imports from Japan, Germany and any other industrial country with a chronic surplus.
b. Acceptance by the European Economic Community that Britain, Italy and the three candidate members have long-term industrial problems which require special measures. c. Large and repeated issues of Special Drawing Rights to ease debt problems until the world recession abates.
d. Funds for commodity stabilisation, bringing world prices for food and raw materials to levels which are sustainable in the long term.
THE MAINTENANCE OF LIVING STANDARDS
09. To assist living standards, we should pledge to the TUC that we shall continue to use tax measures to help with the short-term pay problem and hold down basic elements in the cost of living by:
a. refusing to accept increases in food prices under the Common Agricultural Policy; b. freezing mortgage payments and public sector rents; and c. freezing fuel prices.
10. In addition to this we should discuss proposals to resolve the impasse on public sector pay. One approach would be to offer a fund worth 3 per cent of public sector pay (about £700 million) on top of the 10 per cent guideline, to compensate for the comparative inflexibility of public sector pay bargaining. Another would be to accept indexation for public sector pay if prices rise about 10 per cent in the current pay round. A third would be to look again at low pay generally as constituting a special category.
A PROGRAMME FOR NATIONAL DEVELOPMENT
11. A National Development Fund should be established into which oil revenues would be channelled together with a fixed proportion of pension funds and other financial resources - to be underwritten by the Government on a financially "no better, no worse" basis. This fund should be available for the following purposes:
a. The National Enterprise Board, the Scottish Development Agency, the Welsh Development Agency and the Industry Act. b. Investment in manufacturing industry by public enterprises. c. Support for small businesses. d. Expanded public service expenditure in health, housing, education and welfare, which will create jobs. 12. Major companies should be told that all discretionary Government assistance will in future only be available through planning agreements which will become virtually obligatory - as with North Sea Participation Agreements which were pushed through without statutory backing. Small businesses should qualify for special assistance on the presentation of plans discussed with and acceptable to their workforce in the form of a joint declaration. Industrial democracy should be accelerated through planning agreements and joint declarations for smaller businesses.
13. A National Development Commission should be set up to supervise the formulation and execution of policy on the same basis as the Energy Commission. A Minister of State should be appointed to co-ordinate the work for each English Region, covering both industrial expansion and public services, as already happens in Scotland and Wales under the Development Agencies.
14. These proposals for a National Development Programme should first be discussed with the TUC informally then at the TUC-Labour Party Liaison Committee and finally published as a White Paper. This should then form the basis for future Government policy on industry, public services and employment.
THE CAMPAIGN FOR SUPPORT
15. We have to seek public support on the basis of policies which measure up to the problems which confront the electorate as workers, families and as a nation. The proposals outlined above therefore include four essential elements:
i. An approach to resolution of the impasse on public sector pay.
ii. A continuing programme to assist living standards by tax measures and action on basic items in the cost of living.
iii. A programme for recovery of industry, public services and employment.
iv. A new orientation to international problems.
16. On the basis of a programme of this kind we could consolidate our relationship with trade unions and campaign with confidence for public support.
A W B
Department of Energy
20 December 1977
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80cea9525836e93eed0fd30cf0a55e2ebd1fcf16 | review was not concerned with Northern Ireland since the development of Belfast Airport does not impinge upon the provision of airport capacity in Great Britain. Neither was it concerned with the Channel Islands or the Isle of Man.
CONSULTATIONS ON AIRPORTS POLICY
3 The Roskill Commission produced one of the most thorough examinations ever undertaken of the options for a major project of public investment. Yet the conclusions of the Commission, in a changing economic climate, were shown within a few years to be based on assumptions of rates of growth of air traffic which were unlikely to be achieved, while the pace of technological development and its effects had been more rapid than expected. Moreover, the recommendation of the Commission, for a new airport on an inland site at Cublington, was itself rejected by the Government. This experience suggested a certain caution, and the need to recognise the wider implications, in the case of projects involving the commitment of vast public resources and affecting many millions of people.
4 The Government decided that, for the future, it was essential to ensure that decisions concerning the development of particular airports were reached after taking full account of the views of all those who use, work at, or are affected by, them. To facilitate this process, and to ensure a wider understanding of the issues the Government produced a two part consultation document "Airport Strategy for Great Britain". Part 1, published in November 1975, covered the London area airports and Part 2 published in June 1976 dealt with the regional CE(78) 1 - Annual Review of Agriculture 1978. Note by the Minister of Agriculture, Fisheries and Food
2 - Memorandum for Liaison Committee on Exchange Control. Note by the Chancellor of the Exchequer
3 - The Green Pound. Memorandum by the Minister of Agriculture, Fisheries and Food
4 - White Paper on Airports Policy. Memorandum by the Secretary of State for Trade
5 - Future Pay Policy. Memorandum by the Chancellor of the Exchequer and the Secretary of State for Employment
6 - Special Employment Measures 1978-79. Memorandum by the Secretary of State for Employment
7 - Benefits of North Sea Oil. Note by the Secretary of the Cabinet
8 - Common Fisheries Policy. Note by the Minister of Agriculture, Fisheries and Food and the Secretary of State for Scotland
9 - Special Employment Measures. Memorandum by the Secretary of State for Education and Science and Paymaster General
10 - Economic Outlook: Case for Reflation and Increase in Public Expenditure. Memorandum by the Secretary of State for Social Services and the Minister for Social Security
11 - Statement on the Defence Estimates 1978. Note by the Secretary of State for Defence
12 - The Economic Prospect and Policies. Memorandum by the Chancellor of the Exchequer
13 - Draft White Paper on the Nationalised Industries. Note by the Chancellor of the Exchequer
14 - Second Report from the Select Committee on the PCA, Session 1976-77: Government Observations. Note by the Lord Privy Seal
15 - North Sea Development Fund. Note by the Secretary of the Cabinet
16 - Benefits of North Sea Oil. Note by the Secretary of the Cabinet
17 - Developments in the European Communities. Note by the Secretary of State for Foreign and Commonwealth Affairs
18 - North Sea Oil Development Fund. Note by the Secretary of State for Energy, the Secretary of State for the Environment and the Secretary of State for Scotland CP(78) 19 - Full Employment, Competitiveness and Tax Relief. Memorandum by the Chancellor of the Duchy of Lancaster
20 - North Sea Oil White Paper. Note by the Secretary of the Cabinet
21 - Capital Punishment in the Dependent Overseas Territories. Memorandum by the Lord President of the Council
22 - Draft Government Response to the Expenditure Committee Report on the Civil Service. Note by the Lord Privy Seal
23 - Basis for preparing the 1978 Public Expenditure Survey. Memorandum by the Chief Secretary, Treasury
24 - Public Expenditure Priorities. Memorandum by the Central Policy Review Staff
25 - Pay of Nationalised Industries' Board Members and Senior Staff. Note by the Lord Privy Seal 11 January 1978
CABINET
ANNUAL REVIEW OF AGRICULTURE 1978
Note by the Minister of Agriculture, Fisheries and Food
1. Attached is a Confidential Final Revise copy of the White Paper on the Annual Review of Agriculture 1978 which is circulated for the information of my colleagues. It is proposed to lay this before Parliament on Thursday 12 January and to announce its publication by means of a Written Parliamentary Question.
2. The White Paper is a factual account of the economic situation in the industry; I will circulate separately proposals on farm prices for 1978-79.
J S
Ministry of Agriculture, Fisheries and Food
11 January 1978 AGRICULTURE ACT 1947
ANNUAL REVIEW OF AGRICULTURE 1978
## CONTENTS
| Section | Paragraphs | |----------------------------------------------|------------| | INTRODUCTION | 1-2 | | PART I—STATE OF THE INDUSTRY | 3-6 | | PART II—COMMODITY TRENDS | | | Cereals | 7 | | Oilseed Rape | 8 | | Potatoes | 9-10 | | Sugar Beet | 11-12 | | Horticulture | 13 | | Hops | 14 | | Seeds | 15-16 | | Beef and Milk | 17-21 | | Sheep and Wool | 22-24 | | Pigs | 25-26 | | Poultrymeat | 27 | | Eggs | 28 | | PART III—GENERAL DEVELOPMENTS | | | Farm structure | 29-31 | | Index of net product | 32 | | Labour productivity | 33 | | Net income of the industry | 34-37 | | Cost changes | 38 | | Gross capital formation | 39 | | Agricultural land prices | 40 | | Farm rents | 41 | | Farm workers’ earnings | 42 | | Public expenditure | 43-44 |
## APPENDIX
### Statistical tables—general note
| Table No. | Description | Page | |-----------|------------------------------------------------------------------------------|------| | 1. | Agriculture in the national economy | 12–13| | 2. | Crop areas and livestock numbers | 14–15| | 3. | Numbers and size of holdings and enterprises | 16–18| | 4. | Number of persons engaged in agriculture | 19 | | 5. | Estimated average yields of crops and livestock products | 20 | | 6. | Concentrated feedingstuffs | 20 | | 7. | Cereals supplies | 21–22| | 8. | Oilseed rape supplies | 23 | | 9. | Potato supplies | 24 | | 10. | Sugar supplies | 25 | | 11. | Supplies of certain horticultural crops | 26–27| | 12. | Hops supplies | 28 | | 13. | Supplies of herbage seeds | 28 | | 14. | Meat supplies | 29–30| | 15. | Milk production | 31 | | 16. | Milk product supplies | 32–33| | 17. | Egg supplies | 34 | | 18. | Wool supplies | 34 | | 19. | Net income, net product and labour productivity | 35 | | 20. | Average earnings and hours of agricultural workers | 35 | | 21. | Output, input and net income | 36–38| | 22. | Farm rents | 38 | | 23. | Gross capital formation | 38 | | 24. | Specimen net incomes for different types of farm | 39–40| | 25. | Public expenditure under the common agricultural policy (CAP) and on national grants and subsidies | 40–42| | 26. | Aggregate cost changes since the 1977 Annual Review | 42 | | 27. | Commodity price trends | 43–44| INTRODUCTION
1. This White Paper sets out the data considered during the Annual Review of the economic condition and prospects of the United Kingdom agricultural industry. It provides information which can be drawn on by the Government in responding to the proposals by the EEC Commission for agricultural support in 1978/79 and when decisions are taken on support arrangements which remain within our national competence. As in 1977, these decisions will be announced separately.
2. Information in the Statistical Appendix has in most cases been moved on to a calendar year basis, mainly in order to bring it into line with practice in the European Economic Community, but also to reduce the number of different years to which the information relates and the element of forecasting. In most cases the forecasts for 1977 reflect the position as seen at November 1977.
PART I—STATE OF THE INDUSTRY
3. The main feature of agricultural production in 1977 has been the dramatic recovery from the setbacks caused by the weather in the two preceding years. The index of agricultural net product, which in the drought-hit year of 1976 had fallen to 89, reached 112 in 1977—almost as high as the previous best year of 1974. This improvement was largely the result of good weather which had a particularly marked effect on the production of milk and cereals. The industry's cost increases in the period since the last Annual Review are set at £322.5 million compared with £895 million in the previous year. Agricultural net income excluding stock appreciation is expected to rise from £1,158 million in 1976 to £1,348 million in 1977. This represents little change in real terms. The volume of new fixed investment in agriculture is expected to show a reduction in 1977, especially in buildings and works.
4. There was a small increase in the size of the dairy herd in 1977 and this combined with substantially improved yields led to an increase in total sales of milk through the Milk Marketing Boards of 4.5% over 1976. Beef production is in the downward phase of the cycle; the beef breeding herd fell by a further 4% and home production of beef is expected to be 5% down on 1976. Although production of sheepmeat is expected to be 4% lower than in 1976, there are signs of an increase in the breeding flock. The pig breeding herd fell by 7% between June 1976 and June 1977 as a result of difficulties encountered in this sector but returns to producers are expected to recover in 1978. Little change is expected in the size of the egg-laying flock and the production of eggs is expected to increase marginally. Poultrymeat production is also likely to increase slightly in 1977.
5. In the arable sector the 1977 cereals crop is forecast to be some 3.7 million tonnes greater than the 13.26 million tonnes produced in 1976; most of the increase arises from higher yields. Potato plantings were higher than in 1976 and, with yields recovering from the low, drought-affected levels of 1976, supplies should be more than adequate to meet requirements. The area of sugar beet harvested in 1977 is no greater than in 1976 but yields have recovered from the low levels of the last three years and production of white sugar is forecast to amount to nearly 1 million tonnes. The area sown to oilseed rape has continued to expand and yields have improved over the last few years. There was a further slight fall in 1977 in the area of certified herbage seed.
6. The value of horticultural output continued to increase, despite the reductions in yields of vegetables in the first half of the year and losses of orchard and soft fruit, which were more than offset by higher prices. The review of the horticultural industry which was carried out by the Government and the Farmers' Unions early in 1977 forecast a brighter future for the industry than was generally thought possible five years ago. Increased efficiency and the protective effect of the depreciation of sterling have been important factors contributing to the profitability of horticulture.
PART II—COMMODITY TRENDS
Cereals (Tables 2, 5, 7 and 27)
7. The area of cereals harvested in 1977 was 3.71 million hectares, slightly above the 3.68 million hectares in the previous year. Production is expected to total nearly 17 million tonnes, some 3.7 million tonnes above the 13.26 million tonnes in 1976. The wet autumn of 1976 led to a decrease in the area sown to wheat which was largely offset by an increase in the barley area. The harvest was delayed by a cold, wet spring but the favourable growing conditions in the summer led to exceptionally high yields, particularly in comparison with 1976 when yields were unusually low because of drought. In the south, rain in mid-August reduced the quality of the crops, especially wheat, to well below average. Market prices, which rose rapidly in the autumn of 1976, continued to rise during the first half of 1977 to around threshold levels. Following the harvest, while breadmaking wheat and malting barley remained at a premium, the prices for feed grains fell to near intervention levels. Owing to ideal conditions this autumn the sowing of winter cereals is well advanced.
Oilseed rape (Tables 2, 5, 8 and 27)
8. Production of oilseed rape in 1977 again reached a new record level owing partly to a slight improvement in yields but largely to the increased area sown to the crop. Prices towards the end of the 1976/77 marketing year were good but have since fallen following the announcement of a record soya crop in the USA with which rapeseed is in direct competition on the world market.
Potatoes (Tables 2, 5, 9 and 27)
09. In 1977 the target area of 210,000 hectares was exceeded by some 20,000 hectares but the yield was at a lower level than would normally have been expected, and depending on the extent to which consumption levels return to normal, a small surplus can be expected. In view of low producer prices at the beginning of the season, the Potato Marketing Board, with Exchequer assistance, undertook a market support programme in the autumn with the purpose of influencing market prices, so that the average for the season would achieve the guaranteed price of £45.77 per tonne.
10. Proposals for an EEC regime for potatoes have continued to be discussed, but it is not certain that agreement can be reached in time for common arrangements to apply to the 1978 crop. Consideration is currently being given to the appropriate form of marketing and support arrangements for that crop in the absence of a common regime.
Sugar beet (Tables 2, 5, 10 and 27)
11. For 1977 the British Sugar Corporation contracted to purchase the beet from 206,000 hectares. Some 201,000 hectares are expected to be harvested, about the same as in 1976. Weather during the growing season was generally good, yields of beet per hectare are slightly up and sugar content is showing a substantial improvement on last year. Assuming that harvesting and processing proceed as planned, the crop should yield between 900,000 and 1 million tonnes of white sugar.
12. Contracts for 1978 have not yet been completed but the Corporation aims to increase its contracted area.
Horticulture (Tables 2, 5, 11 and 27)
13. The area devoted to horticulture was 289,000 hectares at June 1976 and the provisional figure for 1977 shows no change in the total area. Details are given for the four commodities grown in the UK which are affected by Community intervention arrangements in the fruit and vegetables sector.
(a) Apples. The area of apple orchards (excluding cider apples) continues to decline slowly and in 1977 is estimated at 31,600 hectares. Production capacity, however, has changed very little because of more intensive new orchard planting. The long-term effects of the 1976 drought combined with this year's cold spring led to reduced yields in 1977. Supplies from major apple-exporting countries were also lower than usual. Prices in the UK have consequently been much higher than in 1976.
(b) Pears. The area under pears (excluding perry pears) has changed very little in recent years and is estimated at 5,200 hectares in 1977. This year's crop is slightly below average and substantially below the high level of 1976. Prices are likely to be higher than in 1976, because of both the lighter pear crop and the higher apple prices.
(c) Cauliflowers. The area under cauliflowers continues to decline from the peak in the late 1960s and is estimated to be 14,000 hectares in 1977. The cold, wet weather in late 1976 and early 1977 reduced production of winter cauliflowers but better weather later in the year resulted in an overall increase in output in 1977 compared with 1976. Prices remained high until the late summer of 1977 and the sharp drop since then is not likely to be sufficient to reduce the average price for 1977 below that for 1976.
(d) Tomatoes. About 950 hectares of glasshouse area were used for tomato production in 1977. This figure has remained fairly constant for some years. Poor light conditions reduced yields in 1977 and output is slightly down on the high levels of 1976. Prices are expected to be significantly higher than last year.
Hops (Tables 2, 5, 12 and 27)
14. The area under hops remained stable in 1977 at about 6,000 hectares. There has been a gradual long-term decline in area resulting from the improved utilisation of hops by brewers and increased yields from new varieties. The cold, wet weather early in the year reduced yields to well below those in 1976, which were themselves adversely affected by the drought. Prices for hops in 1977 are similar to those in 1976.
Seeds (Table 13)
15. The area of certified herbage seed which had fallen substantially in both 1975 and 1976 showed only a very slight further fall (1%) in 1977. Yields in general are good with mainly firm prices which are showing an increase on 1976 levels. A notable exception is Italian Ryegrass where increased production has resulted in depressed prices. Home production of herbage seed normally meets 55% of total requirements but abnormal weather conditions resulted in increased imports.
16. The area of certified field bean seed is down by 15% in 1977 but is still excessive in the light of the demand for certified seed for cropping. The expansion of the area sown for the production of certified field pea seed—although small—continues at a high rate and the sharp upward trend is expected to continue. The area of certified seed of linseed rose sharply in 1976 but fell back again in 1977 almost to 1975 levels.
Beef and Milk (Tables 2, 5, 14, 15, 16 and 27)
17. The 1977 June census for the UK showed a levelling out of the decline in the total breeding herd. Numbers were only marginally lower than in June 1976; the dairy herd—about 66% of all breeding cows—showed an increase of 1% but the beef herd was 4% smaller. In England and Wales the September sample census indicated a fall of 1% in the total herd compared with the previous year, due entirely to a further decline in the beef breeding herd.
18. Home production of beef in 1977 is expected to be about 5% less than in 1976, but this decline has been balanced by an increase in imports and decrease in exports in trade with other EEC countries so that total supplies available for consumption are likely to be about the same as in 1976. Average market prices for certified cattle in the UK remained above the weekly target prices until the end of July 1977, reaching a peak of 63.17p per live kg in mid-June. Thereafter, variable premiums were payable in most weeks as market prices underwent a seasonal decline into the autumn. Throughout this period the market was underpinned by a moderate amount of intervention.
19. The average milk yield per cow in 1977 is expected to show an improvement of 3.5% on the 1976 level while the average size of the national dairy herd is expected to increase by about 1% over the previous year. As a result, milk production in 1977 is expected to show an increase of about 4.5% over that for 1976. The amount of milk sold for liquid consumption in 1977 is expected to be lower than in 1976, whilst the availability of milk for manufacture increases appreciably. Cheese production in 1977 is expected to increase slightly over the previous year’s level and butter production is forecast to increase substantially over the 1976 level. Increases in the guaranteed price for milk and the standard quantity at the 1977 Annual Review led to an increase of almost 6% in the guaranteed price for milk for the period 1 April to 31 December.
20. As required by the Treaty of Accession the guaranteed price arrangements for milk producers ended on 31 December 1977 and producer returns from 1 January 1978 depend on the returns the Milk Marketing Boards obtain from the liquid and manufacturing milk markets.
21. The average size of the national dairy herd in 1978 is expected to decline slightly, so that any improvement in milk production in 1978 will depend on whether yields continue to improve.
Sheep and Wool (Tables 2, 14, 18 and 27)
22. Between June 1976 and June 1977 there was a small increase (0.2%) in the total UK breeding flock, the increase in the number of shearling ewes more than compensating for the drop in older ewe numbers. Although the lamb crop was just over 2% smaller than the record crop of 1976, with fewer slaughterings in 1977 the breeding flock is expected to increase in 1978.
23. UK home production of sheepmeat is expected to be about 4% lower in 1977 than in 1976, while at the same time imports are expected to drop by 3.5% and exports to increase by 16%, resulting in a drop in available supplies to the UK home market of just over 5%. In 1977 prices for fat sheep have been above the guarantee, except for 6 weeks between June and August, averaging about 20% above last year’s levels. Prices paid for store lambs and hill ewes have again risen well above those paid the previous year.
24. Production of wool in 1977 again declined very marginally. Prices were especially strong in 1976 owing to the fall in the value of sterling and rose to reach a peak of 126p per kg in February 1977. UK prices then declined by 15-20% in line with a general weakening of world markets. On average, auction prices for the 1977 clip are expected to be below the guarantee but producers’ returns will be made good from the stabilising fund built up during last season’s high-priced sales.
Pigs (Tables 2, 14 and 27)
25. The decline in profitability which began in 1976 continued into 1977 and led to a fall of 7% in the pig breeding herd between June 1976 and June 1977. This is being reflected in lower supplies of pigmeat and production in 1978 is expected to be lower than in 1977.
26. The resulting increase in pig prices together with a reduction in feed costs from the highest levels of 1976/77 may encourage some modest expansion in the breeding herd during 1978. Poultrymeat (Tables 2, 14 and 27)
27. Output of poultrymeat is expected to show a small increase in 1977. Turkey prices have increased but other poultry prices remained generally steady over the year.
Eggs (Tables 2, 5, 17 and 27)
28. Both the annual average size of the laying flock and output are expected to show a small increase in 1977 and higher yields per bird may be reflected in a further marginal increase in production in 1978. Egg prices have fluctuated but over the year as a whole average producer prices are expected to be higher than in 1976.
PART III—GENERAL DEVELOPMENTS
Farm structure (Table 3)
29. The number of farms in the UK continues to decline. Because the standard labour requirements for crops and livestock have been revised in line with current labour usage, comparative figures of holdings by size of business are not available for years before 1975. In 1977 the total number of holdings was 261,000, that is 3% lower than in 1975. Among relatively small changes over this period, the percentage fall in numbers has been most marked among the smaller full-time businesses. Just over 50% of holdings have businesses capable of providing work for at least one man (now defined as those of 250 revised standard man-days or more) but these account for 90% of total output (though in Northern Ireland and Wales the output of part-time farms is rather more significant than in other parts of the UK), while large businesses (1,000 standard man-days or more), though only about 10% of the total number, produce about a half of total output.
30. The average size of farms is increasing. Full-time businesses averaged 113 hectares (total area including rough grazings) in 1977 compared with 111 hectares in 1975. The trend to greater specialisation continues with the number of enterprises (eg dairy herds) declining and their average size increasing. Between 1975 and 1977 the average area of cereals has increased from 30 to 32 hectares; the average dairy herd has risen from 40 to 44 cows though the average beef breeding herd at 18 cows may have declined slightly; the average ewe flock has increased from 164 to 167 breeding sheep and the average pig breeding herd rose from 23 to 25 sows.
31. In Great Britain 62% of the holdings were wholly or mainly owner-occupied in 1977 compared with 54% in 1960/61. The proportion of the total area held by owner-occupiers has increased from 52% in 1960/61 to 57% in 1977. In Northern Ireland virtually all farmers are owner-occupiers.
Index of net product (Table 19)
32. With the change to calendar year accounts, the index has been re-based on 1975=100. It fell to 89 in 1976 because of the drought in that year and the continuing effects of the dry weather of 1975. In 1977, however, it is expected to have recovered to 112—almost back to the average 1972–74 level—as a result of the record cereals harvest, the more normal potato crop and increased milk yields.
**Labour productivity (Tables 4 and 19)**
33. The adverse weather in 1975 and 1976 reduced the volume of output and this is reflected in reduced labour productivity (the volume of gross product per person engaged) for these two years but a substantial recovery to a record level is forecast for 1977. Over the past ten years labour productivity has increased at nearly 4% per annum, only a little below the average of 4% to 5% per annum in the late 1960s and early 1970s. The outflow of regular whole-time workers has continued. In 1976 and 1977 the rate was just over 3½% per annum respectively compared with 5% to 6% per annum in the 1960s.
**Net income of the industry (Tables 19, 21 and 24)**
34. Excluding stock appreciation, aggregate net income, which increased by 25% to £1,158 million in 1976, is expected to show a further increase of 16% to £1,348 million in 1977. In real terms the increase between 1975 and 1976 was 7% and little change is likely in 1977. When stock appreciation is included, aggregate net income increased by 28% to £1,835 million in 1976 and is expected to have fallen by 2% to £1,796 million in 1977. In real terms a 10% increase between 1975 and 1976 is expected to be followed by a fall of 15-5% in 1977.
35. The other main series of farm incomes data examined at the Annual Review is based on samples of full time accounts. They show the impact of the drought and other factors on net income per farm in 1976/77 in the different sectors and regions of the UK. The accounts end on average in February and this year net income excludes stock appreciation of breeding livestock. For this and other reasons the farm accounts results show different changes in income from the aggregate series. Average net income of all types (excluding horticulture) went up in 1976/77 in all countries but at a much lower rate than in the previous year. In England income rose by 4%, in Wales by 28%, in Scotland by 10% and in Northern Ireland by 21%. Higher prices for most crops more than compensated in England and Wales for lower yields caused by the drought and the value of crop output rose by nearly a quarter. The value of output of most livestock was also up, particularly of sheep. Feed prices rose sharply and in England and Wales the poor growth of grass and fodder crops during the drought led to heavier feed bills.
36. On dairy farms higher milk prices and larger herds contributed to increases in income, although in England the rise was less than elsewhere with the drought reducing milk yields and pushing up feed purchases. Sheep farms achieved the largest increase in income. Cattle farms generally had better incomes but for some cattle fatteners income was reduced by heavier feed bills and smaller margins between store and fat prices. Higher prices for many crops contributed to larger incomes on cropping farms in most regions, although in Scotland the increase over the record level of 1975/76 was small. The sharp rise in feed prices and only a small increase in output of pigs and poultry reduced incomes on farms with substantial pig and poultry enterprises, except in Northern Ireland. In real terms income fell in England and also in Scotland where it had reached a record level in 1975/76. In Wales and in Northern Ireland there was a further but much smaller increase.
37. Forecasts of trends in 1977/78 indicate a small rise in average income in England and Wales and Northern Ireland but a fall in Scotland. The record cereals harvest is expected to offset lower prices and the value of cereals output in England and Wales should rise. But the sharp drop in prices will reduce the value of potato output, particularly in areas which had good crops in the previous year. Lower feed prices and, in England and Wales, more plentiful supplies this year of home grown cereals, grass and fodder crops will generally reduce feed bills and benefit incomes of livestock producers. Milk yields have recovered in England and Wales and with generally higher prices for calves and cull cows, dairy incomes should go up in most areas of the UK. Prices for both fat and store sheep have generally been buoyant and a further rise in income is likely on sheep farms. Suckled calf prices were mostly lower than last year’s high levels at the autumn sales and the increase in fat cattle prices has not been sufficient to offset higher costs: incomes of many cattle enterprises may therefore drop, despite lower feed prices and in Great Britain more plentiful fodder. With substantially lower potato revenue, incomes on many general cropping and mixed farms are likely to decline, particularly in Scotland and Northern Ireland which had benefited most from the high potato prices in the previous two years, but higher cereal yields in England and Wales are likely to lead to an increase on specialist cereal farms there. A good recovery in incomes on pig and poultry holdings is expected. In real terms average incomes in 1977/78 are forecast to fall, particularly in Scotland.
Cost changes (Table 26)
38. Net cost increases since 1976 are assessed at about £322.5 million for all products. The main increases are for machinery depreciation (£127 million), labour (£112 million), miscellaneous expenditure (£58 million) and fertilisers and lime (£49 million). There are estimated reductions in the costs of animal feedingstuffs (£62 million), interest (£58 million) and seeds (£25 million).
Gross capital formation (Table 23)
39. It is estimated that there will be a further increase in the value of new investment in 1977. Total gross capital formation in landlord and tenant-type physical assets together is estimated to be £1,596 million in 1977; of this £614 million is estimated to be in plant, machinery and vehicles, ie a rise of 23% over the amount invested in 1976, and £724 million in additions to stocks and work-in-progress. New investment in buildings and works (landlord-type assets) is expected to amount to £258 million. In volume terms new investment in 1977 in plant, machinery and vehicles is expected to be between 1% and 2% lower than in 1976. The volume of investment in buildings and works has continued the downward trend begun in 1973 and in 1977 was 5% lower than in 1976. The physical level of stocks and work-in-progress in 1977 is expected to be higher than in 1976 reflecting larger stocks of harvested crops including fodder. Despite the improvements in conditions, coverage and rates of grants from 1 June 1976, the number of applications estimated for 1977 under the Farm Capital Grants Schemes is likely to be 11% below the number received in 1976. Most of this work would be for completion in 1978 and later years. Under the Farm and Horticulture Development Scheme, however, initial eligibility applications rose sharply after the June changes and nearly 7,000 plans are estimated to be approved in 1977 compared with 479 in 1975 and 1,953 in 1976. Investment under the Scheme takes place in the framework of development plans which can vary in length from one to six years.
Agricultural land prices
40. The average price for all sales of agricultural land of 4 hectares and over in England and Wales, as reported to the Inland Revenue, was £1,295 per hectare for the six-month period ended September 1977. This compares with a price of £1,287 per hectare for the period ended March 1977 and £1,086 per hectare for the period ended September 1976. Because of the delay between a sale being agreed and its notification to the Inland Revenue, this series is subject to a time lag of several months. More up-to-date information from the ADAS/AMC series, which is less comprehensive and relates only to vacant possession sales, indicated that there was a substantial increase in prices in the middle of 1977. The average price of vacant possession land in the three-month period ended September 1977, shown by this series, was £2,406 per hectare. There have also been significant increases in agricultural land prices in Scotland and Northern Ireland.
Farm rents (Table 22)
41. Farm rents in the UK are estimated to have increased by an average of 15.9% in 1977. This estimate is based on the provisional results of the annual ADAS Rent Enquiry in England and Wales and on field enquiries in Scotland. This increase compares with increases of 19.3% in 1976, 16.8% in 1975 and 8.7% in 1974.
Farm workers' earnings (Table 20)
42. In the calendar year 1976 the average earnings of whole-time hired men in the UK were £50.27 per week, including the £6 increases in minimum rates awarded in the winter of 1975/76. Compared with 1975 this is a rise of 17% in money terms and of 0.5% in real terms. In 1977 average whole-time earnings are forecast at about £54 per week, a rise of 7.5% in money terms but a reduction in real terms.
Public expenditure (Table 25)
43. In 1977/78 the estimated outturn for expenditure in the UK on price guarantees, grants and subsidies (excluding the brucellosis incentives and payments connected with the milk subsidy) is about £204 million. The comparable figure for 1976/77 is about £207 million. Expenditure on hill livestock compensatory allowances is expected to be lower than in 1976/77, when the outturn was inflated by payments carried over from 1975/76. This decrease is expected to be partly offset by payments under the capital grant schemes and the new Milk Non-Marketing and Conversion Premium Scheme.
44. Expenditure under the common market organisation of the EEC is estimated to increase by some £33 million to about £204 million in 1977/78 compared with expenditure of £171 million in 1976/77. This expenditure by the Intervention Board for Agricultural Produce includes the Beef Variable Premium Scheme, import and export refunds, certain production subsidies, the gross cost of aids to private storage and the net cost of commodities bought into intervention and subsequently sold. Some of this expenditure benefits consumers and overseas exporting interests rather than producers. The additional expenditure in 1977/78 is mainly due to increased purchases into intervention of skimmed milk powder and butter. Whilst these and other variations account for an increase of some £61 million this has been partly offset by a reduction of about £28 million in the net cost of import and export refunds. APPENDIX
STATISTICAL TABLES
The tables cover largely the same ground as those in last year's White Paper except that Table 27 on Commodity Price Trends has been simplified. Two changes in presentation have, however, been made; the columns showing equivalents in imperial units no longer appear and, with the exceptions of tables relating to fixed dates and those on Herbage Seeds (Table 13), Specimen Net Incomes (Table 24) and Public Expenditure (Table 25), information is now shown on a calendar year basis. Forecasts, which are as at November 1977 unless otherwise indicated, generally refer to the position up to the end of 1977. For some commodities the move to a calendar year basis has involved the introduction of stock figures into the supply tables. Calendar year figures are not available before 1967 and the three-year averages are therefore given for the period 1967 to 1969. New base years have been introduced for some of the indices in Tables 1, 19 and 22.
Even where there has been no change in the basis of the tables, some of the figures in this Appendix differ from those in previous Annual Review White Papers because of later information, changes in the scope and nature of available data and improvements in statistical methods.
All figures relate to the United Kingdom, unless otherwise stated.
Figures for imports from and exports to the Eight relate throughout to the countries of the enlarged European Economic Community (Belgium, Denmark, France, West Germany, the Irish Republic, Italy, Luxembourg and the Netherlands).
Significant items of Channel Islands trade are shown separately in the tables.
Figures for exports include re-exports.
In some cases figures may not add to the totals shown because of roundings.
Symbols:
— means "nil"
... means "negligible" (less than half the last digit shown)
.. means "not available" or "not applicable".
### Table 1
**Agriculture in the national economy**
| Calendar years | Average of 1967–69 | 1973 | 1974 | 1975 | 1976 | 1977 (provisional) | |----------------|---------------------|------|------|------|------|-------------------| | **Agriculture’s contribution to gross domestic product (a)** | £ million | percentage | £ million | percentage | £ million | percentage | £ million | percentage | £ million | percentage | £ million | percentage | | Agriculture’s share of gross fixed capital formation (b) | £ million | percentage | 219 | 2-7 | 441 | 3-1 | 559 | 3-3 | 613 | 3-0 | 726 | 3-1 | | Manpower engaged in agriculture (c) ('000) | 808 | 704 | 678 | 662 | 669 | 661 | | Percentage of total manpower in all occupations | 3-3 | 2-9 | 2-7 | 2-7 | 2-7 | 2-7 | | **Agricultural price index (1970 = 100)** | All products—sales (e)(f) | 92-8 | 146-9 | 166-0 | 205-7 | 264-6 | 272-5 | | Inputs—selected indicators (f) | Feedingstuffs (g) | 89-5 | 160-8 | 209-2 | 207-5 | 257-5 | 304-5 | | Fertilisers (excl. lime) (h) | 98-4 | 127-2 | 177-6 | 211-4 | 226-7 | 260-5 | | Fuel (i) | 94-5 | 122-5 | 178-6 | 215-9 | 265-7 | 320-0 | | Labour | 84-6 | 150-2 | 194-7 | 245-4 | 292-7 | 317-7 | | Machinery (j) | 88-4 | 131-0 | 159-0 | 200-4 | 235-3 | 291-5 | | Imports of food, feed & alcoholic beverages (k) | £ million | 1,881 | 3,205 | 3,990 | 4,480 | 5,215 | (Jan.–Sept. only) 4,854 | | Import volume index (1970 = 100) | 100-4 | 102-9 | 97-4 | 96-9 | 102-2 | 105-0 | | Import price index (1970 = 100) | 89-1 | 151-2 | 200-9 | 223-8 | 248-4 | 301-3 | | Exports of food, feed & alcoholic beverages (k) | £ million | 399 | 853 | 1,048 | 1,366 | 1,620 | (Jan.–Sept. only) 1,508 | | Export volume index (1970 = 100) | 87-2 | 137-3 | 143-8 | 155-4 | 156-0 | 162-4 | | Export price index (1970 = 100) | 93-0 | 126-2 | 150-8 | 178-3 | 212-6 | 253-9 | | Consumers’ expenditure on food and alcoholic beverages (l) | £ million | 8,427 | 13,122 | 15,191 | 18,729 | 22,182 | (prov.) 11,650 | | Percentage of total consumers’ expenditure | 30-8 | 29-0 | 29-2 | 29-5 | 30-1 | 29-7 | | Retail price index (January 1970 = 100) | Food (f)(m) | 92-3 | 144-7 | 170-7 | 214-5 | 257-2 | 304-5 | | Alcoholic beverages (f) (m) | 90-6 | 144-8 | 127-3 | 156-9 | 184-9 | 211-0 | | All items (f)(m) | 92-6 | 132-4 | 153-7 | 190-8 | 222-4 | 255-1 | TABLE 1 (Continued)
(a) Excluding appreciation in value of work-in-progress and stocks. (b) All fixed assets (excluding work-in-progress and stocks). (c) Total manpower engaged in agriculture between 1973 and 1977 comprises the numbers of self-employed, employers and employees in employment, (excluding farmers' spouses) given in the June censuses conducted by the Agricultural Departments of England and Wales, Scotland and Northern Ireland. The average figures for 1967 to 1969 are based on the Department of Employment series of the count of national insurance cards and the population census, adjusted by the ratio in 1971 of this series to the Agricultural Departments' series. (d) See footnote (e) to Table 4. (e) Based on prices after addition of subsidy or grant, where payable. (f) Annual averages. (g) Based on representative prices for compound and straight feedingstuffs. (h) Department of Industry's Wholesale Price Index—excluding Value Added Tax. (i) Department of Energy's Indices and Department of Industry's Wholesale Price Indices—excluding Value Added Tax. (j) Department of Industry's Wholesale Price Index—excluding Value Added Tax. (k) Includes oilseeds and nuts, animal oils and fats, citric acid, food dyes, essences, starches, edible gelatin, albumen and casings. (l) Includes caterers' expenditure on food. (m) Source: Department of Employment.
| Year | Value 1 | Value 2 | Value 3 | Value 4 | Value 5 | Value 6 | Value 7 | Value 8 | Value 9 | Value 10 | |------|---------|---------|---------|---------|---------|---------|---------|---------|---------|---------| | 1973 | | | | | | | | | | | | 1974 | | | | | | | | | | | | 1975 | | | | | | | | | | | | 1976 | | | | | | | | | | | | 1977 | | | | | | | | | | |
Source: Department of Employment.
### Table 2
**Crop areas and livestock numbers (a)**
At June of each year
| | Average 1967-69 | 1973 | 1974 | 1975 | 1976 | 1977 (provisional) | |------------------------|-----------------|------|------|------|------|-------------------| | **A. Crop areas ('000 hectares)** | | | | | | | | Total area | 19,515 | 18,988 | 19,010 | 18,978 | 18,987 | 18,899 | | of which: | | | | | | | | Wheat | 915 | 1,146 | 1,233 | 1,034 | 1,231 | 1,072 | | Barley | 2,418 | 2,267 | 2,214 | 2,345 | 2,182 | 2,412 | | Oats | 391 | 281 | 233 | 232 | 235 | 193 | | Mixed corn | 48 | 51 | 42 | 35 | 28 | 24 | | Rye | 4 | 5 | 5 | 6 | 8 | 11 | | Maize | | 1 | 1 | 1 | 1 | 1 | | Total cereals (b) | 3,776 | 3,752 | 3,747 | 3,653 | 3,685 | 3,713 | | Potatoes | 272 | 225 | 215 | 204 | 222 | 230 | | Sugar beet | 186 | 194 | 195 | 198 | 206 | 202 | | Oilseed rape | | 14 | 25 | 39 | 48 | 55 | | Hops | 7 | 7 | 7 | 6 | 6 | 6 | | Vegetables grown in the open | 176 | 187 | 194 | 198 | 206 | 209 | | Orchard fruit | 71 | 57 | 55 | 53 | 52 | 50 | | Soft fruit (c) | 18 | 18 | 18 | 17 | 17 | 16 | | Ornamentals (d) | 14 | 16 | 16 | 15 | 14 | 12 | | Total horticulture (e) | 280 | 281 | 285 | 285 | 289 | 289 | | Total tillage (f) | 4,981 | 4,818 | 4,838 | 4,816 | 4,821 | 4,853 | | All grasses under five years old (g) (h) | 2,372 | 2,346 | 2,316 | 2,138 | 2,154 | 2,137 | | Total arable | 7,353 | 7,164 | 7,154 | 6,954 | 6,975 | 6,990 | | All grasses five years old and over (i) | 4,974 | 4,914 | 4,920 | 5,074 | 5,081 | 5,050 | | Rough grazing (j) | 7,115 | 6,605 | 6,564 | 6,555 | 6,513 | 6,409 | | Other land (k) | | 305 | 372 | 395 | 419 | 450 | | **B. Livestock numbers ('000 head)** | | | | | | | | Total cattle and calves | 12,289 | 14,445 | 15,203 | 14,717 | 14,069 | 13,899 | | of which: | | | | | | | | Dairy cows | 3,238 | 3,436 | 3,394 | 3,242 | 3,228 | 3,264 | | Beef cows | 1,168 | 1,678 | 1,887 | 1,899 | 1,764 | 1,694 | | Heifers in calf | 821 | 988 | 1,041 | 903 | 939 | 830 | | Total sheep and lambs | 27,831 | 27,943 | 28,498 | 28,270 | 28,265 | 28,030 | | of which: | | | | | | | | Ewes | 11,374 | 10,921 | 11,192 | 11,279 | 11,298 | 11,198 | | Shearlings | 2,429 | 2,733 | 2,673 | 2,471 | 2,369 | 2,499 | | Total pigs | 7,425 | 8,979 | 8,544 | 7,532 | 7,947 | 7,665 | | of which: | | | | | | | | Sows in pig and other sows for breeding | 732 | 859 | 783 | 710 | 747 | 720 | | Gilts in pig | 143 | 156 | 107 | 104 | 137 | 100 | | Total poultry | 126,532 | 144,079 | 139,672 | 136,572 | 142,222 | 137,434 | | of which: | | | | | | | | Table fowls (incl. broilers) | 38,971 | 58,366 | 56,701 | 56,708 | 61,325 | 57,725 | | Laying fowls | 52,478 | 51,766 | 49,924 | 49,359 | 49,085 | 48,824 | | Growing pullets | 22,572 | 18,808 | 18,958 | 18,195 | 18,383 | 17,503 | The coverage for 1973 and onwards includes all known holdings in the United Kingdom with 40 standard man-days or more (a standard man-day (smd) represents 8 hours' productive work by an adult male worker under average conditions). All holdings with less than 40 smd in Scotland are excluded. In England and Wales and Northern Ireland holdings with less than 40 smd are excluded only if they have less than 4 hectares (10 acres) of crops and grass and no regular whole-time worker. The same criteria applied in Great Britain in the years 1970 to 1972, except that the threshold for standard labour requirements in those years was 26 smd.
The 1967-69 figures related to all known agricultural holdings exceeding one acre (0.4 hectares) in extent. The figures for Northern Ireland for these years related to holdings of one acre (0.4 hectares) or more, except for numbers of livestock, which were collected from all owners, irrespective of the size of the holding, as well as from landless stockholders.
The introduction of the changes of definition in Northern Ireland in 1973, following similar changes in Great Britain which excluded some 14,000 statistically insignificant holdings in 1970 and about 8,000 in 1973, had the net result of eliminating about 6,000 or so holdings from the Northern Ireland census.
For threshing.
Includes small area of soft fruit grown under orchard trees in England and Wales.
Hardy nursery stock, bulbs and flowers.
Most of the difference between total horticultural area and the sum of individual sectors is made up by the glasshouse area.
Includes areas of other crops and bare fallow not shown in the table.
Includes lucerne.
Before 1975 collected as:
- in England and Wales—"clover, sainfoin and temporary grasses";
- in Scotland—"grass under seven years old";
- in Northern Ireland—"1st, 2nd and 3rd year".
Before 1975 collected as:
- in England and Wales—"permanent grass";
- in Scotland—"grass seven years old and over";
- in Northern Ireland—"4th year or older".
Includes common rough grazings.
Returns of "other land" were collected for the first time in England and Wales in June 1969. From June 1969 to June 1973 "other land" in Great Britain was collected as woodland and areas under roads, yards, buildings, of which was ancillary to the farming of the land; in Northern Ireland it included land within agricultural holdings which was under bog, water, roads, buildings, etc., and waste land not used for agriculture. In June 1974 the definition was changed in England and Wales to include all other land forming part of the holding and in Scotland it was extended to include ponds and derelict land. The Northern Ireland definition is unchanged.
### Table 3
**Numbers and size of holdings and enterprises (a)**
At June of each year
| Crops and grass area | 1975 | 1977 (provisional) | |----------------------|------|---------------------| | Number of holdings ('000) with | | | | 0-1 to 19-9 hectares | 119-9 | 112-0 | | 20 to 49-9 hectares | 73-2 | 71-4 | | 50 to 99-9 hectares | 41-7 | 41-5 | | 100 hectares and over | 29-3 | 29-4 | | Total | 264-1 | 254-3 | | Average crops and grass area per holding (hectares) (b) | | | | 0-1 to 19-9 hectares | 45-2 | 46-9 | | 100 hectares and over | 8-2% | 7-7% | | Per cent of total crops and grass area on holdings with | | | | 0-1 to 19-9 hectares | 47-4% | 48-5% | | 100 hectares and over | | |
| Size of business (smd) (c) (d) | 1975 | 1977 (provisional) | |-----------------------------|------|---------------------| | Number of holdings ('000) with | | | | Under 250 smd | 138-0 | 133-3 | | 250 to 499 smd | 56-4 | 53-3 | | 500 to 999 smd | 45-8 | 45-0 | | 1,000 smd and over | 28-3 | 28-9 | | Total | 268-6 | 260-6 | | Holdings 250 smd and over | | | | Average size of business (smd) | 857 | 891 | | Average total area per holding (hectares) | 111-3 | 113-2 | | Contribution to total output (%) | 90-2% | 90-8% |
| Total cereals | 1975 | 1977 (provisional) | |----------------|------|---------------------| | Number of holdings ('000) with | | | | 0-1 to 19-9 hectares | 77-6 | 71-3 | | 20 to 49-9 hectares | 22-7 | 22-5 | | 50 hectares and over | 21-0 | 21-3 | | Total | 121-3 | 115-1 | | Average area (hectares) | 30-1 | 32-3 | | Per cent of total cereals area on holdings with 50 hectares and over of cereals | 65-9% | 67-2% |
| Potatoes | 1975 | 1977 (provisional) | |-----------|------|---------------------| | Number of holdings ('000) with | | | | 0-1 to 9-9 hectares | 50-4 | 55-9 | | 10 to 19-9 hectares | 3-7 | 4-0 | | 20 hectares and over | 1-9 | 2-2 | | Total | 56-0 | 62-2 | | Average area (hectares) | 3-6 | 3-7 | | Per cent of total potato area on holdings with 20 hectares and over of potatoes | 33-6% | 34-5% | | At June of each year | 1975 | 1977 (provisional) | |----------------------|------|-------------------| | **Sugar beet (e)** | | | | Number of holdings ('000) with | | | | 0-1 to 9-9 hectares | 9-7 | 8-5 | | 10 to 19-9 hectares | 3-2 | 3-1 | | 20 hectares and over | 2-8 | 3-0 | | Total | 15-7 | 14-6 | | Average area (hectares) | | | | Per cent of total sugar beet area on holdings with 20 hectares and over of sugar beet | 55-9% | 59-6% | | **Dairy cows** | | | | Number of holdings ('000) with | | | | 1 to 29 | 39-9 | 33-1 | | 30 to 59 | 23-4 | 22-2 | | 60 and over | 17-6 | 18-7 | | Total | 81-0 | 74-0 | | Average size of herd | | | | Per cent of total dairy cows in herds of 60 and over | 53-3% | 57-3% | | **Beef cows** | | | | Number of holdings ('000) with | | | | 1 to 19 | 72-5 | 66-4 | | 20 to 49 | 20-8 | 18-5 | | 50 and over | 9-1 | 8-2 | | Total | 102-4| 93-1 | | Average size of herd | | | | Per cent of total beef cows in herds of 50 and over | 19 | 18 | | Breeding sheep (f) | | | | Number of holdings ('000) with | | | | 1 to 99 | 45-3 | 44-0 | | 100 to 499 | 29-8 | 28-9 | | 500 and over | 5-6 | 5-7 | | Total | 80-7 | 78-6 | | Average size of flock | | | | Per cent of breeding sheep in flocks of 500 and over | 164 | 167 | | Breeding pigs | | | | Number of holdings ('000) with | | | | 1 to 19 | 26-2 | 23-2 | | 20 to 49 | 5-0 | 4-7 | | 50 and over | 4-4 | 4-5 | | Total | 35-6 | 32-3 | | Average size of herd | | | | Per cent of total breeding pigs in herds of 50 and over | 23 | 25 | | Fattening pigs (g) | | | | Number of holdings ('000) with | | | | 1 to 199 | 22-7 | 19-8 | | 200 to 999 | 4-7 | 4-5 | | 1,000 and over | 0-8 | 0-9 | | Total | 28-2 | 25-2 | | Average size of herd | | | | Per cent of total fattening pigs in herds of 1,000 and over | 156 | 178 | | | 33-5% | 37-5% |
### Table 3 (Continued)
**Numbers and size of holdings and enterprises (a)**
At June of each year
| Laying fowls | 1975 | 1977 (provisional) | |--------------|------|-------------------| | Number of holdings ('000) with | | | | 1 to 4,999 | 82-0 | 73-3 | | 5,000 to 19,999 | 1-6 | 1-5 | | 20,000 and over | 0-4 | 0-5 | | Total | 84-1 | 75-3 | | Average size of flock | 587 | 648 | | Per cent of total laying fowls in flocks of 20,000 and over | 47-1% | 53-4% |
| Broilers (b) | 1975 | 1977 | |--------------|------|------| | Number of holdings ('000) with | | | | 1 to 9,999 | 1-7 | 1-7 | | 10,000 to 99,999 | 0-6 | 0-7 | | 100,000 and over | 0-1 | 0-1 | | Total | 2-4 | 2-4 | | Average size of flock | 23,403 | 23,437 | | Per cent of total broilers in flocks of 100,000 and over | 59-9% | 56-7% |
(a) Because of the revisions to size groups following metrication, and the revision of smd values in 1976, it is no longer possible to give comparative data for a span of five years. Although the figures quoted for 1975 and 1977 are strictly comparable, great caution must be exercised in comparing them with figures quoted in earlier Annual Review White Papers. The figures included for Northern Ireland in the first two sections for both years relate only to holdings with 50 smd or more.
(b) The average size of holding based on total area was—
1975 66-1 hectares of which 45-2 hectares were crops and grass 1977 67-4 hectares of which 46-9 hectares were crops and grass
(c) These figures include holdings with no crops and grass area which are excluded from the first section of the table.
(d) Revised standard man day groups have been adopted and the lower group of under 250 smd applies throughout the UK. The change in smd values has meant a general shift of holdings into lower size groups and this movement is particularly marked in Northern Ireland as the following figures show:
| Holdings in Northern Ireland—June 1975 ('000) | |---------------------------------------------| | Based on old smd values | Based on new smd values | | 50-199 smd | 16-0 | 50-249 smd | 20-0 | | 200-599 smd | 12-6 | 250-499 smd | 6-9 | | 600-1,199 smd | 3-4 | 500-999 smd | 2-8 | | 1,200 smd and over | 1-2 | 1,000 smd and over | 0-7 | | Total | 33-6 | Total | 30-4 |
As a result of this change, the figures shown in this table are not comparable with those in previous White Papers.
(e) Figures relate to England and Wales only.
(f) Figures included for Scotland and Northern Ireland relate to the December censuses in 1974 and 1976.
(g) Figures included for Northern Ireland relate to pig holdings which had fattening pigs only.
(h) Figures for Scotland, and figures for Northern Ireland in 1977 only, include small numbers of other table fowls.
### Table 4
Number of persons engaged in agriculture (a)
| At June of each year | Average of 1967-69 | 1973 | 1974 | 1975 | 1976 | 1977 (provisional) | |----------------------|-------------------|------|------|------|------|-------------------| | **Workers** | | | | | | | | **Regular Whole-time:** | | | | | | | | Hired: | | | | | | | | Male | 171 | 164 | 157 | 154 | 148 | | | Female | 16 | 16 | 15 | 13 | 12 | | | Family: | | | | | | | | Male | 45 | 39 | 37 | 35 | 38 | | | Female | 15 | 14 | 13 | 12 | 7 | | | All male | 297 | 216 | 203 | 194 | 189 | 186 | | All female | 29 | 31 | 30 | 28 | 25 | 20 | | Total... | (326) | (247)| (233)| (222)| (213)| (206) | | **Regular Part-time:** | | | | | | | | Hired: | | | | | | | | Male | 25 | 24 | 22 | 21 | 21 | | | Female | 26 | 27 | 26 | 26 | 24 | | | Family: | | | | | | | | Male | 16 | 15 | 15 | 14 | 15 | | | Female | 18 | 17 | 18 | 17 | 8 | | | All male | 37 | 41 | 39 | 36 | 35 | 36 | | All female | 24 | 44 | 44 | 44 | 42 | 42 | | Total... | (62) (c) | (85) (c) | (83) (c) | (80) (c) | (77) (c) | (68) (c) | | **Seasonal or Casual:** | | | | | | | | All male | 34 | 40 | 39 | 41 | 45 | 53 | | All female | 35 | 38 | 36 | 32 | 35 | 41 | | Total... | (69) (d) | (78) (d) | (74) (d) | (73) (d) | (80) (d) | (94) (d) | | **Salaried managers (b):** | | | | | | | | All male | 6 | 7 | 7 | 7 | 8 | | | Total employed | 456 | 416 | 398 | 382 | 377 | 375 | | **Farmers, partners and directors** | | | | | | | | Whole-time | 222 | 214 | 212 | 219 (e) | 212 | | | Part-time | 66 | 66 | 68 | 72 (e) | 73 | | | Total... | (288) | (280) | (280) | (292) | (285) | | | **Total** | 704 | 678 | 662 | 669 | 661 | | | **Wives/Husbands of farmers, partners and directors (engaged in farm work)** | | | | | | 82 |
(a) The figures are based on returns in the agricultural census. They include some estimates for figures not directly obtainable from the Scottish census results and for that reason they differ slightly from some of the published United Kingdom census results. Because of changes in the census categories in England and Wales in 1970 and 1972, numbers returned for earlier years are not available on the same basis as those for the most recent years. Before 1977 the figures do not include the wives/husbands of farmers, partners and directors, even though the wives/husbands themselves may be partners or directors. In 1977 wives/husbands of farmers, partners and directors were returned separately, but only if they were engaged in farm work.
(b) Figures relate to Great Britain only.
(c) Includes seasonal or casual workers in Northern Ireland. See footnote (d).
(d) Before 1975 seasonal or casual workers were not returned as a separate item in Northern Ireland, but were included with part-time workers.
(e) The increase in numbers of farmers, partners and directors in 1976 occurred in England and Wales and is thought to reflect a more complete enumeration in the agricultural census.
(f) The decrease in the number of regular whole-time and part-time female workers in 1977 is thought to be explained by the separate return, for the first time in England and Wales, of farmers' wives, some of whom were probably returned previously as family workers.
### TABLE 5
**Estimated average yields of crops and livestock products**
| Calendar years | Unit | Average of 1967-69 | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|------|-------------------|------|------|------|------|-----------------| | **Crops** | | | | | | | | | Wheat | tonnes/hectare | 3.91 | 4.36 | 4.97 | 4.34 | 3.85 | 4.92 | | Barley | | 3.61 | 3.97 | 4.12 | 3.63 | 3.51 | 4.45 | | Oats | | 3.33 | 3.84 | 3.77 | 3.42 | 3.25 | 4.15 | | Potatoes | | 2.49 | 3.04 | 3.16 | 2.23 | 2.16 | 2.86 | | Sugar (a) | | 5.7 | 6.1 | 3.6 | 3.9 | 4.2 | 5.8 | | Oilsed rape | | | | | | | | | Apples: | | | | | | | | | Dessert (b) | | 9.59 | 12.81| 9.57 | 11.65| 10.90| 7.2 | | Culinary (b) | | 8.57 | 13.62| 11.85| 11.94| 12.09| 11.2 | | Pears (b) | | 8.66 | 8.43 | 10.00| 5.45 | 12.50| 8.2 | | Tomatoes (b) | | 96.6 | 117.8| 123.2| 129.5| 137.3| 133.9| | Cauliflowers (b)| | 18.4 | 20.8 | 20.6 | 18.8 | 16.5 | 20.4 | | Hops | | 1.46 | 1.54 | 1.55 | 1.30 | 1.35 | 1.23 | | **Livestock products** | | | | | | | | | Milk (c) | litres/cow | 3,673| 3,975| 3,925| 4,102| 4,267 (e) | 4,407 | | Eggs (d) | no./bird | 210.5| 228.5| 229.5| 229.0| 238.5 (e) | 240.5 |
(a) Sugar-in-beet per crop hectare. (b) Gross yields from cropped area. (c) Yield per dairy type cow per annum. (d) Eggs per laying bird, including breeding flock. (e) 366 days.
### TABLE 6
**Concentrated feedingstuffs**
| Calendar years | Average of 1967-69 | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|-------------------|------|------|------|------|-----------------| | **Usage of home supplies** | | | | | | | | Coarse grains | 7.4 | 8.1 | 7.1 | 6.8 | 6.6 | 6.6 | | Wheat used for feed | 1.7 | 2.6 | 2.3 | 2.8 | 2.4 | 2.2 | | Other supplies (a) | 3.1 | 3.8 | 3.9 | 3.8 | 4.2 | 4.2 | | **Total home supplies** | 12.2 | 14.5 | 13.2 | 13.4 | 12.9 | 13.0 | | **Usage of imported supplies** | | | | | | | | Coarse grains | 3.1 | 2.2 | 2.7 | 2.4 | 2.9 | 3.1 | | Wheat used for feed | 0.8 | 0.9 | 0.3 | 0.5 | 0.8 | 0.5 | | Protein, molasses and other miscellaneous feeds | 2.2 | 1.9 | 1.6 | 1.9 | 2.1 | 1.9 | | **Total imported supplies** | 6.1 | 5.0 | 4.6 | 4.8 | 5.8 | 5.5 | | **Total usage** | 18.3 | 19.5 | 17.8 | 18.2 | 18.7 | 18.5 | | of which home-grown concentrated feeds retained on farms | 3.8 | 4.9 | 3.8 | 4.2 | 3.6 | 3.9 |
(a) Including home-produced by-products from imported materials. | Calendar years | Cereals supplies | '000 tonnes | |----------------|-----------------|-------------| | | Average of 1967-1969 | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | | **Wheat (a)** | Production | 3,579 | 5,002 | 6,130 | 4,488 | 4,740 | 5,280 | | | Imports (b) | 738 | 583 | 933 | 1,179 | 1,915 | 2,355 | | | from third countries | 3,602 | 3,220 | 1,940 | 2,455 | 1,894 | 1,505 | | | Exports | 8 | 17 | 9 | 195 | 30 | 75 | | | to the Eight | 7 | 15 | 42 | 57 | 97 | 40 | | | to third countries | 3,579 | 738 | 5,002 | 4,488 | 1,179 | 2,355 | | | Total new supply | 7,904 | 8,773 | 8,952 | 7,870 | 8,422 | 9,025 | | | Production as % of total new supply | 45% | 57% | 68% | 57% | 56% | 59% | | | End December farm stocks | 1,987 | 2,530 | 3,580 | 2,320 | 2,300 | 2,850 | | | Disposals (c) | 5,032 | 5,024 | 4,921 | 5,289 | 5,161 | 5,170 | | | (of which home-produced) | (1,610) | (2,167) | (2,312) | (2,404) | (2,289) | (1,940) | | | (of which home-produced) | 2,469 | 3,629 | 2,576 | 3,392 | 2,855 | 2,840 | | | Total Disposals (d) | 7,944 | 9,083 | 7,902 | 9,130 | 8,442 | 8,475 | | **Barley** | Production | 8,717 | 9,007 | 9,133 | 8,513 | 7,648 | 10,745 | | | Imports | 25 | 160 | 684 | 427 | 301 | 505 | | | from the Eight | 290 | 132 | 128 | 75 | 345 | 380 | | | to third countries | 405 | 247 | 148 | 988 | 161 | 430 | | | Total new supply | 8,519 | 9,030 | 9,781 | 7,947 | 8,096 | 11,200 | | | Production as % of total new supply | 102% | 100% | 93% | 107% | 94% | 96% | | | End December farm stocks | 4,700 | 4,160 | 4,530 | 3,940 | 3,200 | 5,430 | | | Disposals (c) | 6,506 | 7,121 | 6,858 | 6,260 | 6,375 | 6,710 | | | (of which home-produced) | (6,267) | (6,927) | (6,185) | (5,926) | (5,894) | (5,960) | | | (of which home-produced) | 1,391 | 1,861 | 2,008 | 1,750 | 1,915 | 1,725 | | | Total Disposals (d) | 8,412 | 9,510 | 9,411 | 8,537 | 8,836 | 8,970 | | **Oats** | Production | 1,305 | 1,080 | 955 | 795 | 764 | 805 | | | Imports (b) | - | 2 | 8 | 20 | 11 | 3 | | | from the Eight | 18 | 6 | 17 | 9 | 42 | 47 | | | to third countries | 33 | 30 | 11 | 4 | 3 | 5 | | | Total new supply | 1,290 | 1,049 | 967 | 820 | 814 | 850 | | | Production as % of total new supply | 101% | 103% | 99% | 97% | 94% | 95% | | | End December farm stocks | 753 | 600 | 570 | 450 | 420 | 450 | | | Disposals (c) | 998 | 939 | 771 | 725 | 643 | 605 | | | (of which home-produced) | (991) | (934) | (765) | (714) | (621) | (595) | | | (of which home-produced) | 119 | 124 | 150 | 140 | 139 | 155 | | | Total Disposals (d) | 1,233 | 1,149 | 997 | 940 | 844 | 820 | | Calendar years | Cereals supplies | '000 tonnes | |----------------|-----------------|-------------| | | Average of 1967-1969 | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | | **Mixed Corn (e)** | Production | 161 | 192 | 146 | 118 | 89 | 90 | | **Rye (f)** | Production | 11 | 16 | 15 | 19 | 20 | 41 | | Imports (b) : from the Eight | 12 | 21 | 8 | 18 | 8 | 21 | | : from third countries | 12 | 25 | 9 | 15 | 17 | 3 | | **Total new supply** | 23 | 62 | 32 | 52 | 45 | 65 | | **Production as % of total new supply** | 48% | 26% | 47% | 37% | 44% | 63% | | **Maize** | Production | 6 | 3 | 3 | 2 | 2 | 2 | | Imports (b) : from the Eight | 172 | 290 | 957 | 666 | 527 | 125 | | : from third countries | 3,378 | 3,099 | 2,315 | 2,363 | 3,238 | 3,545 | | Exports : to the Eight | 14 | 14 | 19 | 65 | 44 | 25 | | : to third countries | 14 | 14 | 19 | 65 | 44 | 25 | | **Total new supply** | 3,536 | 3,381 | 3,256 | 2,967 | 3,723 | 3,647 | | **Sorghum** | Imports (b) : from the Eight | 15 | 24 | 65 | 100 | 97 | 35 | | : from third countries | 168 | 48 | 360 | 375 | 220 | 140 | | Exports : to the Eight | 1 | 2 | 27 | 8 | 1 | 1 | | : to third countries | 1 | 2 | 27 | 8 | 1 | 1 | | **Total new supply** | 183 | 71 | 423 | 448 | 309 | 174 | | **Total cereals (a)** | Production | 13,773 | 15,303 | 16,382 | 13,936 | 13,263 | 16,963 | | Imports (b) : from the Eight | 950 | 1,080 | 2,655 | 2,410 | 2,859 | 3,044 | | : from third countries | 7,468 | 6,530 | 4,769 | 5,292 | 5,756 | 5,620 | | Exports : to the Eight | 460 | 309 | 189 | 1,279 | 246 | 536 | | : to third countries | 115 | 46 | 60 | 137 | 134 | 40 | | **Total new supply** | 21,616 | 22,558 | 23,557 | 20,222 | 21,498 | 25,051 | | **Production as % of total new supply** | 64% | 68% | 70% | 69% | 62% | 68% | | **End December farm stocks (g)** | 7,400 | 7,290 | 8,680 | 6,710 | 5,920 | 8,730 | | **Total Disposals (h)** | 21,492 | 23,448 | 22,167 | 22,192 | 22,288 | 22,241 |
(a) Includes flour under the heading of wheat imports and exports. (b) Countries of origin cannot be identified with certainty from the Overseas Trade Statistics but transhipments have, where possible, been allocated to country of origin. (c) 1973, 1974, 1975, 1976 and 1977 exclude 22,000, 49,000, 35,000, 41,000 and 40,000 tonnes respectively, of wheat milled and exported as flour. (d) Total new supply adjusted for changes in December farm stocks. (e) Import/export figures are not separately distinguished in Overseas Trade Statistics. (f) Export figures not separately distinguished in Overseas Trade Statistics before 1970 and not significant thereafter. (g) In respect of wheat, barley and oats. (h) Total new supply adjusted for changes in December farm stocks of wheat, barley and oats. | Calendar years | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|------|------|------|------|-----------------| | Production | 31 | 53 | 67 | 111 | 135 | | Imports: from the Eight | 33 | 34 | 17 | 48 | 110 | | : from third countries | 60 | 33 | 28 | 67 | 90 | | Exports | 1 | 3 | ... | 1 | 1 | | Total new supply | 123 | 117 | 112 | 225 | 334 | | Production as % of total new supply | 25% | 45% | 60% | 49% | 40% |
### Table 9
| Calendar years | Average of 1967-1969 | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|----------------------|------|------|------|------|-----------------| | **Production:** | | | | | | | | early (a) | 543 | 463 | 458 | 350 | 371 | 419 | | maincrop | 6,220 | 6,382| 6,333| 4,201| 4,418| 6,152 | | **Total production** | 6,763 | 6,845| 6,791| 4,551| 4,789| 6,571 | | **Exports:** | | | | | | | | to the Eight | 82 | 21 | 6 | 4 | 3 | 2 | | to third countries | 201 | 146 | 144 | 81 | 97 | | | **Crop available for human consumption** | 4,996 | 5,299| 5,328| 3,659| 3,574| 5,058 | | Potatoes unsold at 31 December | 2,164 | 2,369| 2,332| 1,079| 1,320| 2,154 | | **Total Disposals of home crop for human consumption** | 5,005 | 5,175| 5,365| 4,912| 3,333| 4,224 | | **Supplies from Channel Islands (early)** | 45 | 27 | 23 | 24 | 15 | | | **Imports for human consumption:** | 334 | | | | | | | Raw: (b) | | | | | | | | early: | 4 | 21 | 67 | 12 | 25 | | | from the Eight | 225 | 208 | 167 | 258 | 346 | | | from third countries | 9 | | 134 | 269 | 86 | | | maincrop: | | | | | | | | from the Eight | 145 | 47 | 54 | 54 | 66 | 42 | | from third countries | 70 | 46 | 48 | 398 | 303 | | | Processed: (c) | | | | | | | | from the Eight | 5,493 | 5,566| 5,721| 5,412| 4,450| 5,157 | | from third countries | 4,567 | 4,557| 4,226| 3,032| 3,777| | | **Total new supply for human consumption** | 9,999 | 1,164| 1,186| 1,418| 1,380| | | of which: raw | 91% | 93% | 94% | 91% | 75% | 82% | | processed (c) | 99% | 100% | 100% | 100% | 100% | 100% |
(a) Up to 1968 all early varieties. As from 1969 potatoes lifted before 1 August in any year. (b) Excludes seed potatoes. (c) Raw equivalent.
### Table 10: Sugar Supplies
| Calendar years | Average of 1967-1969 | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|----------------------|------|------|------|------|-----------------| | Production (a) | 882 | 963 | 568 | 641 | 695 | 975 | | Imports (b): | | | | | | | | from the Eight | 51 | 60 | 292 | 513 | 288 | 335 | | from third countries | 1,990 | 1,907| 1,870| 1,712| 1,713| 1,480 | | Exports (b): | | | | | | | | to the Eight | 23 | 6 | 2 | 2 | 16 | 5 | | to third countries | 220 | 343 | 300 | 352 | 246 | 205 | | Total new supply| 2,680 | 2,581| 2,428| 2,512| 2,434| 2,580 | | Production as % of total new supply | 33% | 37% | 23% | 25% | 29% | 38% |
(a) Sugar coming out of the factory in the early part of the new year is regarded as being part of the previous calendar year’s production.
(b) Includes only sugar as such and takes no account of the sugar content of processed products.
### Table 11
**Supplies of certain horticultural crops**
| Calendar years | Average of 1967-1969 | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|----------------------|------|------|------|------|-----------------| | **Apples (excludes cider apples)** | | | | | | | | Cropped area ('000 hectares) | | | | | | | | Dessert | 23-25 | 21-55 | 21-24 | 20-37 | 20-35 | 20-3 | | Culinary | 15-48 | 12-73 | 12-64 | 11-84 | 11-69 | 11-3 | | **('000 tonnes)** | | | | | | | | Output | | | | | | | | Dessert | 212 | 257 | 189 | 224 | 198 | 140 | | Culinary | 126 | 169 | 138 | 122 | 132 | 126 | | Imports: from the Eight | 74 | 164 | 191 | 210 | 257 | 240 | | : from third countries | 187 | 154 | 121 | 120 | 125 | 70 | | Exports: to the Eight | (a) | 12 | 15 | 13 | 14 | 13 | | : to third countries | | | | | | | | Total new supply | 590 | 667 | 673 | 645 | 711 | 581 | | Output as % of total new supply | 57% | 64% | 49% | 54% | 46% | 46% | | End December farm stocks | 78 | 149 | 100 | 118 | 104 | 86 | | **Pears (excludes perry pears)** | | | | | | | | Cropped area ('000 hectares) | 5-83 | 5-22 | 5-21 | 5-20 | 5-10 | 5-2 | | ('000 tonnes) | | | | | | | | Output | 47 | 43 | 46 | 27 | 59 | 41 | | Imports: from the Eight | 28 | 23 | 30 | 36 | 28 | 25 | | : from third countries | 32 | 25 | 18 | 15 | 20 | 17 | | Exports: to the Eight | (a) | 1 | 1 | 1 | 2 | 2 | | : to third countries | | | | | | | | Total new supply | 105 | 89 | 92 | 84 | 94 | 85 | | Output as % of total new supply | 45% | 48% | 50% | 32% | 63% | 48% | | End December farm stocks | 9 | 13 | 14 | 7 | 17 | 12 | | **Cauliflowers** | | | | | | | | Cropped area ('000 hectares) | 17-93 | 16-33 | 15-96 | 15-70 | 14-39 | 14-04 | | ('000 tonnes) | | | | | | | | Output | 312 | 297 | 313 | 255 | 216 | 274 | | Supplies from Channel Islands | 15 | 8 | 15 | 7 | 11 | 5 | | Imports: from the Eight | 32 | 16 | 14 | 25 | 20 | 22 | | : from third countries | | | | | | | | Total new supply | 359 | 321 | 345 | 287 | 251 | 305 | | Output as % of total new supply | 87% | 93% | 91% | 89% | 86% | 90% |
### Supplies of certain horticultural crops
| Calendar years | Average of 1967-1969 | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|----------------------|------|------|------|------|-----------------| | **Tomatoes** | | | | | | | | Cropped area ('000 hectares) | 1.03 | 1.02 | 0.99 | 0.95 | 0.95 | | | ('000 tonnes) | | | | | | | | Output | 98 | 117 | 121 | 122 | 128 | 124 | | Supplies from Channel Islands | 69 | 61 | 58 | 61 | 58 | 55 | | Imports: from the Eight | 53 | 35 | 42 | 46 | 32 | 33 | | : from third countries | 110 | 107 | 113 | 95 | 94 | 95 | | Exports | | 1 | 1 | 1 | 3 | 2 | | Total new supply | 330 | 319 | 333 | 323 | 309 | 305 | | Output as % of total new supply | 30% | 37% | 36% | 38% | 41% | 41% |
(a) Not available—believed insignificant.
### Table 12
**Hops supplies**
| Calendar years | Average of 1967-1969 | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|----------------------|------|------|------|------|-----------------| | Production | 10.6 | 10.4 | 10.2 | 8.3 | 8.0 | 7.3 | | Imports: from the Eight | 0.3 | 0.8 | 0.7 | 0.7 | 1.1 | 1.3 | | from third countries | 0.6 | 0.5 | 0.9 | 0.6 | 0.7 | 0.7 | | Exports: to the Eight | 0.9 | 0.7 | 0.6 | 0.3 | 0.4 | 0.3 | | to third countries | 0.1 | 0.1 | 0.2 | 0.2 | 0.2 | 0.3 | | Total new supply | 10.5 | 10.9 | 11.1 | 9.1 | 9.2 | 8.7 | | Production as % of total new supply | 101% | 95% | 92% | 91% | 87% | 84% |
### Table 13
**Supplies of herbage seeds (a)**
| June/May years | Average of 1966/67-1968/69 | 1973/74 | 1974/75 | 1975/76 | 1976/77 | 1977/78 (forecast) | |----------------|-----------------------------|---------|---------|---------|---------|-------------------| | Area ('000 hectares) (b) | 14.7 | 22.6 | 24.0 | 22.6 | 17.2 | 17.0 | | ('000 tonnes) | Production—all seed | 14.2 | 21.2 | 16.7 | 16.4 | 10.5 | 10.6 | | of which certified seed | (9.5) | (16.1) | (15.2) | (15.5) | (10.5) | (10.6) | | Imports—all seed: | 9.9 | 8.1 | 7.0 | 11.1 | 11.0 | 9.4 | | from the Eight | 8.5 | 10.9 | 7.1 | 5.1 | 2.2 | 2.2 | | from third countries | 1.4 | 1.0 | 0.9 | 2.1 | 0.5 | 0.2 | | Exports—all seed: | 1.0 | 1.1 | 0.7 | 2.1 | 0.5 | 0.2 | | to the Eight | 1.1 | 0.5 | 0.7 | 2.1 | 0.5 | 0.2 | | to third countries | 30.5 | 38.6 | 29.2 | 30.0 | 28.5 | 28.5 | | Total supply | Production as % of total supply | 47% | 55% | 57% | 55% | 37% |
(a) Grass and clover. (b) Certified seed only. | Calendar years | Meat Supplies (a) | '000 tonnes | |----------------|------------------|-------------| | | Average of 1967-1969 | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | | **Beef and veal** | | | | | | | | Production | 946 | 887 | 1,086 | 1,219 | 1,069 | 1,019 | | Imports (b): | | | | | | | | from the Eight | 116 | 74 | 208 | 208 | 187 | 234 | | from third countries | 197 | 263 | 86 | 39 | 62 | 56 | | Exports (live and meat): | 52 | 96 | 75 | 134 | 112 | 97 | | to the Eight | 2 | 5 | 3 | 3 | 3 | 2 | | to third countries | 2 | 4 | 4 | 5 | 4 | 4 | | Supplies to the Channel Islands | 2 | 4 | 4 | 5 | 4 | 4 | | Total new supply | 1,202 | 1,119 | 1,299 | 1,324 | 1,199 | 1,206 | | Production as % of total new supply | 79% | 79% | 84% | 92% | 89% | 84% | | **Mutton and lamb** | | | | | | | | Production | 244 | 236 | 253 | 264 | 248 | 238 | | Imports: from the Eight (c) | 7 | 2 | 2 | 2 | 1 | 1 | | from third countries | 347 | 264 | 212 | 242 | 225 | 217 | | Exports (live and meat): | 11 | 29 | 26 | 36 | 35 | 41 | | to the Eight | 1 | 1 | 2 | 2 | 3 | 3 | | to third countries | 1 | 1 | 2 | 1 | 2 | 2 | | Supplies to the Channel Islands | 1 | 1 | 2 | 1 | 2 | 2 | | Total new supply | 586 | 472 | 436 | 468 | 434 | 410 | | Production as % of total new supply | 42% | 50% | 58% | 56% | 57% | 58% | | **Pork** | | | | | | | | Production | 587 | 683 | 695 | 572 | 584 | 633 | | Imports: from the Eight (c) | 3 | 14 | 6 | 14 | 12 | 13 | | from third countries | 3 | 6 | 1 | 3 | 1 | 1 | | Exports (live and meat): | 8 | 14 | 24 | 7 | 10 | 14 | | to the Eight | 2 | 2 | 2 | 1 | 3 | 2 | | to third countries | 1 | 1 | 2 | 1 | 2 | 2 | | Supplies to the Channel Islands | 1 | 1 | 2 | 1 | 2 | 2 | | Total new supply | 583 | 689 | 675 | 579 | 583 | 631 | | Production as % of total new supply | 101% | 99% | 103% | 99% | 100% | 100% | | **Bacon and ham** | | | | | | | | Production | 220 | 252 | 243 | 210 | 222 | 221 | | Imports: from the Eight | 335 | 276 | 265 | 252 | 240 | 244 | | from third countries | 70 | 38 | 23 | 21 | 16 | 18 | | Exports | 1 | 1 | 2 | 1 | 2 | 2 | | Supplies to the Channel Islands | 1 | 1 | 2 | 1 | 2 | 2 | | Total new supply | 623 | 564 | 527 | 482 | 475 | 479 | | Production as % of total new supply | 35% | 45% | 46% | 44% | 47% | 46% | | Calendar years | Average of 1967-1969 | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|----------------------|------|------|------|------|-----------------| | **Poultrymeat** | | | | | | | | Production | 509 | 664 | 652 | 628 | 663 | 676 | | Imports: from the Eight | 8 | 7 | 7 | 7 | 5 | 7 | | from third countries | 3 | 3 | 2 | 2 | 1 | 1 | | Exports | 1 | 3 | 2 | 2 | 13 | 36 | | Supplies to the Channel Islands | 1 | 2 | 2 | 2 | 4 | 2 | | Total new supply | 515 | 669 | 654 | 633 | 652 | 646 | | Production as % of total new supply | 99% | 99% | 100% | 99% | 102% | 105% | | **Total meat supplies** | | | | | | | | Production | 2,506 | 2,721| 2,929| 2,893| 2,785| 2,787 | | Imports(b): from the Eight (c) | 469 | 373 | 487 | 483 | 445 | 499 | | from third countries | 617 | 574 | 322 | 306 | 305 | 293 | | Exports (live and meat) | 78 | 149 | 134 | 185 | 179 | 195 | | Supplies to the Channel Islands | 5 | 9 | 12 | 10 | 15 | 12 | | Total new supply | 3,509 | 3,511| 3,591| 3,486| 3,342| 3,376 | | Production as % of total new supply | 71% | 77% | 82% | 83% | 83% | 83% |
(a) Does not include meat offals or trade in preserved or manufactured meat products (e.g. canned meat). (b) Boneless beef and veal have been converted to bone-in weights, in order to bring imports into line with the home production figures. (c) Includes meat from animals imported fat from Irish Republic. | Calendar years | Average of 1967-69 | 1973 | 1974 | 1975 | 1976 (d) | 1977 (forecast) | |----------------|-------------------|------|------|------|----------|----------------| | Sales through milk marketing schemes: | | | | | | | | for liquid consumption | | | | | | | | for manufacture: | | | | | | | | butter | 1,136 | 2,224 | 1,239 | 1,095 | 2,053 | 2,772 | | cheese (a) | 1,253 | 1,819 | 2,181 | 2,361 | 2,040 | 2,150 | | cream | 751 | 958 | 1,006 | 1,003 | 964 | 957 | | condensed milk—full cream (b) | 630 | 603 | 580 | 502 | 524 | 579 | | milk powder—full cream... | 214 | 219 | 260 | 195 | 175 | 175 | | other | 105 | 122 | 132 | 114 | 103 | 107 | | Total for manufacture | 4,089 | 5,945 | 5,399 | 5,270 | 5,858 | 6,739 | | Total sales | 11,606 | 13,468 | 13,098 | 13,133 | 13,618 | 14,221 | | Used on farms (c) | 302 | 231 | 221 | 210 | 201 | 194 | | Output for human consumption... | 11,908 | 13,699 | 13,319 | 13,343 | 13,819 | 14,415 |
(a) Includes farmhouse cheese made under milk marketing schemes. (b) Includes condensed milk used in the production of chocolate crumb. (c) Includes farmhouse manufacture of butter and cream, milk consumed in farm households and sales outside milk marketing schemes. (d) 366 days.
### Table 16
**Milk product supplies**
| Calendar years | Average of 1967-69 | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|-------------------|------|------|------|------|-----------------| | **Butter** | | | | | | | | Opening Stocks | 42 | 69 | 61 | 67 | 83 | 107 | | Production (a) | 50 | 98 | 54 | 48 | 90 | 120 | | Imports (b) from the Eight | 159 | 186 | 326 | 364 | 275 | 215 | | from third countries | 297 | 152 | 120 | 124 | 123 | 120 | | Exports (inc. re-exports): | | | | | | | | to the Eight | ... | 5 | 2 | 1 | 14 | 14 | | to third countries | 3 | 11 | 2 | 2 | 2 | 2 | | Total Supply | 546 | 489 | 558 | 601 | 555 | 545 | | Closing Stocks | 40 | 61 | 67 | 83 | 107 | 139 | | Offtake | 506 | 428 | 491 | 517 | 449 | 406 | | Production as % of offtake | 10% | 23% | 11% | 9% | 20% | 29% | | **Cheese** | | | | | | | | Opening Stocks | 55 | 85 | 74 | 71 | 100 | 100 | | Production (a) | 122 | 182 | 218 | 235 | 204 | 214 | | Imports: from the Eight | 55 | 83 | 101 | 119 | 114 | 100 | | from third countries | 110 | 54 | 21 | 33 | 33 | 15 | | Exports (inc. re-exports): | | | | | | | | to the Eight | 1 | 3 | 3 | 4 | 6 | 6 | | to third countries | 2 | 3 | 9 | 3 | 4 | 5 | | Total Supply | 339 | 398 | 401 | 452 | 441 | 418 | | Closing Stocks | 61 | 74 | 71 | 100 | 100 | 78 | | Offtake | 278 | 324 | 329 | 351 | 341 | 340 | | Production as % of offtake | 44% | 56% | 66% | 67% | 60% | 63% | | **Cream—fresh, frozen and sterilized** | | | | | | | | Opening Stocks | ... | ... | ... | ... | ... | ... | | Production (a) | 67 | 82 | 85 | 84 | 81 | 81 | | Imports: from the Eight | 12 | 11 | 8 | 6 | 5 | 5 | | from third countries | ... | ... | ... | ... | ... | ... | | Exports (inc. re-exports): | | | | | | | | to the Eight | ... | ... | ... | ... | ... | ... | | to third countries | 2 | ... | ... | ... | ... | ... | | Total Supply | 77 | 93 | 93 | 90 | 85 | 85 | | Closing Stocks | ... | ... | ... | ... | ... | ... | | Offtake | 77 | 93 | 93 | 90 | 85 | 85 | | Production as % of offtake | 87% | 88% | 91% | 93% | 95% | 95% | | **Condensed Milk—full cream** | | | | | | | | Opening Stocks (c) | 33 | 30 | 28 | 23 | 21 | 16 | | Production (c) | 245 | 234 | 226 | 195 | 204 | 223 | | Imports: from the Eight | 8 | 11 | 9 | 9 | 9 | 10 | | from third countries | ... | ... | ... | ... | ... | ... | | Exports (d) (inc. re-exports): | | | | | | | | to the Eight | 1 | 1 | ... | 1 | 2 | 2 | | to third countries | 32 | 13 | 16 | 14 | 29 | 24 | | Total Supply | 253 | 262 | 246 | 213 | 203 | 223 | | Closing Stocks (c) | 32 | 28 | 23 | 21 | 16 | 16 | | Offtake | 221 | 234 | 223 | 192 | 187 | 207 | | Production as % of offtake | 111% | 100% | 101% | 102% | 109% | 108% |
### Table 16 (Continued)
#### Milk product supplies
| Calendar years | Average of 1967-69 | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|--------------------|------|------|------|------|-----------------| | **Milk Powder—full cream** | | | | | | | | Opening Stocks | 3 | 4 | 5 | 3 | 2 | 2 | | Production | 27 | 27 | 32 | 24 | 22 | 22 | | Imports: from the Eight | 4 | 13 | 11 | 7 | 4 | 4 | | from third countries | 16 | 2 | | | | | | Exports (inc. re-exports): to the Eight | 1 | 1 | 3 | 3 | 2 | 2 | | to third countries... | 8 | 7 | 8 | 8 | 8 | 9 | | Total Supply | 41 | 39 | 37 | 24 | 17 | 17 | | Closing Stocks | 3 | 5 | 3 | 2 | 2 | 2 | | Offtake | 38 | 35 | 33 | 21 | 15 | 15 | | Production as % of offtake | 71% | 77% | 97% | 114% | 147% | 147% |
#### Skimmed Milk Powder
| Calendar years | Average of 1967-69 | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|--------------------|------|------|------|------|-----------------| | Opening Stocks (e) | 21 | 59 | 60 | 52 | 49 | 26 | | Production | 84 | 158 | 103 | 106 | 173 | 214 | | Imports: from the Eight | 14 | 15 | 10 | 54 | 22 | 20 | | from third countries | 22 | 1 | | | | | | Exports (f) (inc. re-exports): to the Eight | 13 | 92 | 38 | 55 | 102 | 60 | | to third countries... | 10 | 21 | 13 | 5 | 13 | 8 | | Total Supply | 118 | 119 | 123 | 154 | 129 | 192 | | Closing Stocks (e) | 24 | 60 | 52 | 49 | 26 | 86 | | Offtake | 93 | 59 | 71 | 106 | 103 | 106 | | Production as % of offtake | 90% | 268% | 145% | 100% | 168% | 202% |
(a) Includes farmhouse manufacture. (b) Includes butter other than natural (i.e. butter fat and oil, dehydrated butter and ghee). (c) Includes condensed milk used in the production of chocolate crumb. (d) From February 1973 to December 1973 and from January 1975 includes an insignificant amount derived from skimmed milk. (e) Figures for stocks from closing stocks 1973 include Intervention stocks as well as manufacturers' stocks but do not include powder bought by the Irish Republic Intervention agency for storage in the UK. (f) Between February and December 1973 this includes buttermilk and whey powder.
### Table 17
**Egg supplies**
| Calendar years | Average of 1967-1969 | 1973 | 1974 | 1975 | 1976 (a) | 1977 (forecast) | |----------------|----------------------|------|------|------|----------|-----------------| | **Home supplies (b)** | | | | | | | | Packing station throughput: | | | | | | | | sold in shell | 581 | 587 | 605 | 614 | 612 | 597 | | processed | 92 | 42 | 40 | 38 | 36 | 41 | | Other sales (c) | 549 | 536 | 503 | 464 | 501 | 526 | | **Total output for human consumption** | 1,222 | 1,165 | 1,148 | 1,116 | 1,149 | 1,164 | | Imports (d): from the Eight | 12 | 34 | 35 | 38 | 17 | 15 | | from third countries | 38 | 10 | 8 | 2 | 2 | 2 | | Exports (d): to the Eight | 12 | 4 | 9 | 9 | 12 | 14 | | to third countries | 29 | 2 | 1 | 3 | 3 | 4 | | **Total new supply** | 1,231 | 1,203 | 1,181 | 1,144 | 1,153 | 1,163 | | Output as % of total new supply | 99% | 97% | 97% | 98% | 100% | 100% |
(a) 366 days. (b) Hen eggs for human consumption including output from commercially insignificant units. (c) Includes farmhouse consumption and domestic egg production. (d) Includes shell egg equivalent of whole dried, frozen and liquid egg and yolk, but excludes albumen.
### Table 18
**Wool supplies**
| Calendar years | Average of 1967-1969 | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|----------------------|------|------|------|------|-----------------| | **Production: (a)** | | | | | | | | of which clip | 53 | 48 | 50 | 49 | 48 | 47 | | Imports: | (35) | (35) | (35) | (35) | (34) | (33) | | from the Eight | 12 | 16 | 11 | 15 | 19 | 21 | | from third countries | 227 | 135 | 110 | 117 | 143 | 125 | | Exports: | | | | | | | | to the Eight | 14 | 16 | 15 | 19 | 21 | 26 | | to third countries | 12 | 11 | 9 | 10 | 11 | 8 | | **Total new supply** | 266 | 172 | 147 | 152 | 178 | 159 | | Production as % of total new supply | 20 | 28 | 34 | 32 | 27 | 30 |
(a) Figures relate to clip years (June/May) but in practice the bulk of production is within the calendar year.
### Table 19
**Net income, net product and labour productivity**
*All commercially significant holdings*
| Year | FARMING NET INCOME £m at current prices (a) | NET PRODUCT at constant prices (c) | LABOUR PRODUCTIVITY (d) | |------|-------------------------------------------|-----------------------------------|-------------------------| | | including Stock Appreciation | excluding Stock Appreciation (b) | 1975=100 | 1975=100 | | | Actual | 3-year moving average | Actual | | | 1967 | 546 | 509 | 103 | 79 | | 1968 | 504 | 448 | 100 | 79 | | 1969 | 566 | 498 | 102 | 83 | | 1970 | 539 | 473 | 101 | 87 | | 1971 | 686 | 575 | 112 | 99 | | 1972 | 706 | 590 | 111 | 100 | | 1973 | 1,198 | 858 | 113 | 102 | | 1974 | 1,340 | 742 | 114 | 107 | | 1975 | 1,435 | 930 | 100 | 100 | | 1976 | 1,835 | 1,158 | 89 | 91 | | 1977 | 1,796 | 1,348 | 112 | 111 |
Forecasts for 1977 are as at end of October 1977.
(a) Net income is defined as the return to farmers and their wives for their manual and managerial labour and for the use of the occupiers' investment after provision has been made for depreciation. The occupiers' investment includes all tenant-type physical assets in livestock, crops, machinery, etc, but excludes any financial assets and all landlord-type assets such as land and buildings. These figures are not directly comparable with incomes in other sectors of the economy, since farm income also includes elements of wages and changes in stock valuations as well as profits.
(b) This is net income at current prices including the change in the volume of stocks and work-in-progress but excluding stock appreciation (i.e. that part of the change in the value of stocks and work-in-progress attributable to the change in the cost of inputs between the beginning and end of year).
(c) Net product (net output) measures year-to-year changes in the value-added at constant prices by farmers, landowners and farmworkers to all the goods and services purchased from outside the agricultural sector.
(d) Labour productivity is defined here as gross product per person engaged in agriculture. Gross product is gross output less all inputs other than depreciation, labour, net rent and interest. It is measured here at constant prices. In order to be consistent with national economic conventions, gross product as used in the calculation of labour productivity covers agricultural contractors as well as all commercially significant holdings. The total number of persons engaged in agriculture comprises the number of employees, employers and self-employed (excluding farmers' spouses) recorded in the annual June census taken by the Agricultural Departments. Before 1971, however, the trends in numbers of employers and employees were estimated respectively from the Population Censuses and the Department of Employment count of national insurance cards.
### Table 20
**Average earnings and hours of agricultural workers (a)**
| Calendar years | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|------|------|------|------|-----------------| | Earnings £ per week (b) | ... | 27-32 | 34-07 | 42-92 | 50-27 | | Hours per week (c) | ... | 47-2 | 45-9 | 46-0 | 45-5 |
(a) For all hired regular whole-time men.
(b) Earnings include pay for statutory holidays and payments-in-kind which are valued at rates set down by the Agricultural Wages Boards and comprise houses, milk, potatoes, etc (the principal one being houses, most of which were, in England and Wales, valued at 50p before 20 January 1976 and £1-50 thereafter).
(c) All hours worked and statutory holidays. | Calendar years | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|------|------|------|------|-----------------| | **OUTPUT (b) (c)** | | | | | | | Farm crops (d) | | | | | | | Wheat | 227 | 279 | 300 | 334 | 365 | | Barley | 239 | 338 | 330 | 382 | 401 | | Oats | 14 | 17 | 15 | 18 | 20 | | Other cereals | 1 | 1 | 1 | 2 | 2 | | (Total cereals)| (482)| (635)| (646)| (726)| (788) | | Potatoes | 123 | 146 | 317 | 568 | 374 | | Sugar beet | 69 | 59 | 85 | 98 | 143 | | Hops | 9 | 9 | 9 | 11 | 10 | | Other (e) | 29 | 51 | 43 | 36 | 58 | | **1. Total crops** | 712 | 900 | 1,110| 1,469| 1,373 | | **Horticulture** | | | | | | | Vegetables (including mushrooms) | 228 | 286 | 343 | 376 | 455 | | Fruit | 87 | 100 | 91 | 112 | 133 | | Other (f) | 77 | 85 | 93 | 108 | 116 | | **2. Total horticulture** | 392 | 471 | 527 | 596 | 704 | | **Livestock** | | | | | | | Fat cattle and calves | 564 | 617 | 897 | 994 | 1,046 | | Fat sheep and lambs | 156 | 164 | 187 | 240 | 283 | | Fat pigs | 420 | 468 | 493 | 556 | 642 | | Poultry | 210 | 254 | 284 | 344 | 460 | | Other (g) | 18 | 19 | 21 | 24 | 31 | | **3. Total livestock** | 1,366| 1,522| 1,883| 2,158| 2,462 | | **Livestock products** | | | | | | | Milk and milk products | 697 | 837 | 1,065| 1,295| 1,461 | | Eggs | 285 | 306 | 276 | 342 | 393 | | Clip wool | 16 | 17 | 20 | 24 | 31 | | Other (h) | 5 | 6 | 8 | 10 | 10 | | **4. Total livestock products** | 1,003| 1,166| 1,368| 1,670| 1,896 | | **5. Sundry output (i)** | 26 | 31 | 33 | 32 | 38 | | **6. TOTAL OUTPUT (1 + 2 + 3 + 4 + 5)** | 3,500| 4,090| 4,921| 5,925| 6,473 | | **7. Sundry receipts (j)** | 31 | 42 | 46 | 44 | 36 | | **8. Production grants** | 96 | 90 | 152 | 114 | 105 | | **9. TOTAL RECEIPTS (6 + 7 + 8)** | 3,627| 4,222| 5,118| 6,084| 6,613 | | Work-in-Progress Change (k) | +87 | -40 | -60 | -19 | -38 | | Stock Change (l) | -20 | +32 | -143 | -66 | +320 | | **10. Total change due to volume** | +67 | -8 | -203 | -85 | +282 | | **11. GROSS OUTPUT (9 + 10)** | 3,694| 4,214| 4,915| 5,999| 6,896 | | Intermediate output (m) | | | | | | | Feed (n) | 250 | 326 | 299 | 352 | 381 | | Seed | 39 | 48 | 64 | 102 | 107 | | **12. Total intermediate output** | 289 | 375 | 362 | 454 | 488 |
### Table 21 (Continued)
**Output, input and net income (a)**
| Calendar years | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|------|------|------|------|-----------------| | **13. FINAL OUTPUT (11-12)** | 3,405 | 3,839 | 4,553 | 5,545 | 6,408 | | **INPUT** | | | | | | | **Expenditure** | | | | | | | Feedingstuffs | 960 | 1,152 | 1,152 | 1,576 | 1,770 | | Seeds | 79 | 97 | 118 | 181 | 204 | | Livestock (imported and inter-farm expenses) | 94 | 103 | 125 | 108 | 138 | | Fertilisers and lime (o) | 210 | 292 | 320 | 369 | 436 | | Machinery | 233 | 289 | 345 | 402 | 477 | | of which: Repairs | (112) | (129) | (156) | (179) | (209) | | Fuel and oil | (82) | (117) | (131) | (156) | (192) | | Other (including contract services) | (39) | (43) | (58) | (67) | (76) | | Farm maintenance (p) | 132 | 151 | 178 | 211 | 245 | | Miscellaneous expenditure (q) | 223 | 284 | 363 | 423 | 469 | | **14. TOTAL EXPENDITURE (r)** | 1,931 | 2,368 | 2,601 | 3,269 | 3,738 | | **Stocks (s)** | | | | | | | Change due to volume | -8 | -17 | +12 | -30 | +5 | | **16. GROSS INPUT (14+15)** | 1,923 | 2,351 | 2,613 | 3,240 | 3,743 | | **17. NET INPUT (16-12)** | 1,634 | 1,976 | 2,250 | 2,786 | 3,255 | | **18. GROSS PRODUCT (11-16) or (13-17)** | 1,770 | 1,863 | 2,302 | 2,760 | 3,153 | | **Depreciation** | | | | | | | Machinery | 195 | 255 | 342 | 405 | 503 | | Other (p) | 88 | 117 | 152 | 195 | 245 | | **19. Total depreciation** | 282 | 372 | 494 | 600 | 747 | | **20. NET PRODUCT (18-19)** | 1,488 | 1,491 | 1,808 | 2,160 | 2,405 | | Labour | 503 | 608 | 748 | 868 | 935 | | Net rent (t) | 54 | 42 | 33 | 21 | 6 | | Interest (u) | 73 | 99 | 98 | 113 | 116 | | **21. FARMING NET INCOME excluding stock appreciation** | 858 | 742 | 930 | 1,158 | 1,348 | | Stock appreciation (v) | | | | | | | Livestock | +233 | +305 | +289 | +424 | +381 | | Crops and other | +107 | +292 | +216 | +253 | +67 | | **22. Total** | +340 | +597 | +505 | +677 | +447 | | **23. FARMING NET INCOME including stock appreciation (21+22)** | 1,198 | 1,340 | 1,435 | 1,835 | 1,796 |
Estimates for 1977 are as at end of October 1977.
(a) The estimates represent value at current prices for commercially significant holdings which, broadly speaking, are holdings with 26 standard man-days or more.
(b) Because this table relates to output ie sales, rather than total production, the quantities used are not the same as those shown for home production in the supply tables (Tables 6-18). Output is netted of Value Added Tax (VAT) collected on the sale of inedible products, which is repaid to H.M. Customs and Excise. Figures include subsidies.
Excludes deficiency payments on retained cereals and compensation payments on unsold potatoes—see (J).
Deficiency payments on cereal retentions, Potato Marketing Board compensation payments, animal disease compensation, co-operative society dividends and interest and other miscellaneous receipts.
Growing crops and livestock numbers; closing level minus opening level.
Stocks of unsold harvested crops; closing level minus opening level.
Sales included in Output but subsequently repurchased and so reappearing as Input.
Cereals, potatoes, beans, hay and dried grass.
Before subsidy where applicable.
Including landlord-type maintenance work.
Electricity, veterinary expenses, pesticides, rates and miscellaneous costs.
Expenditure is netted or VAT reclaimed in the normal way, but each heading includes VAT paid without recovery by, for example, unregistered producers. The total unrecovered tax is estimated at £10 million for 1975, £12 million for 1976 and for 1977 £13 million.
Feed (purchased) and fertilisers. Opening stock minus closing stock.
Net Rent is the residual after deducting landlords' maintenance and depreciation from Gross Rent. Landlords' maintenance and landlords' depreciation are included in Farm Maintenance and Depreciation and hence the whole of Gross Rent is treated as a cost to the industry. The estimates of Gross Rent are £205.1 million in 1973, £226.6 million in 1974, £263.1 million in 1975, £309.3 million in 1976 and £359.0 million in 1977.
On commercial debt for current farming purposes.
Stock appreciation measures that part of the change in the value of stocks and work-in-progress attributable to the change in the cost of inputs between the beginning and end of year.
### Table 22
| Calendar years | Farm rents (a) | |----------------|----------------| | | Index of gross rents per hectare | | | 1975 = 100 | | 1967 | 54.7 | | 1968 | 59.8 | | 1969 | 63.0 | | 1970 | 67.2 | | 1971 | 70.9 | | 1972 | 74.9 | | 1973 | 79.2 | | 1974 | 86.1 | | 1975 | 100.0 | | 1976 | 119.1 | | 1977 (provisional) | 137.8 |
(a) Gross rents per hectare vary considerably between different regions and sizes and types of farm. Detailed information on farm rents is published in "Farm Rents in England and Wales" and in "Scottish Agricultural Economics". In Northern Ireland almost all land is held by owner-occupiers.
### Table 23
| Calendar years | Gross capital formation (a) £ million | |----------------|-------------------------------------| | | Average of 1967-69 | 1973 | 1974 | 1975 | 1976 | 1977 (provisional) | | Plant, machinery and vehicles | 130 | 231 | 308 | 372 | 500 | 614 | | Buildings and works | 89 | 209 | 251 | 241 | 226 | 258 | | Work-in-progress and stocks (b) | 62 | 415 | 606 | 290 | 622 | 724 | | Total | 281 | 855 | 1,165 | 903 | 1,348 | 1,596 |
(a) Capital formation represents investment by tenants, landlords, and owner-occupiers. Investment in plant and machinery is normally tenant-type. Investment in buildings and works is normally landlord-type. In practice, however, there are many variations in the division between the two responsibilities. The figures in the table represent gross expenditure before crediting any grants which reduce the cost to the owner or occupier. Annual charges in the form of depreciation are made for these items in calculating aggregate farming net income.
(b) See Table 21 (Item plus item 22 minus item 15).
### Table 24
Specimen net incomes for different types of farm (a)
| Type of farm | Average size of farm in sample | Weighted average net income (excluding breeding livestock stock appreciation) per farm (for an identical sample in the two years) | Percentage change % | |--------------|--------------------------------|-----------------------------------------------------------------------------------------------------------------|---------------------| | | Hectares of crops and grass | Standard man-days (smd) | 1975/76 | 1976/77 | | | **England (275–4199 smd) (b)** | | | | | | | Specialist dairy | 50 | 970 | 6,247 | 6,508 | + 4 | | Mainly dairy | 80 | 1,182 | 8,296 | 8,517 | + 3 | | Mainly sheep | 71 | 791 | 4,609 | 5,954 | + 29 | | Cattle and sheep | 83 | 759 | 5,982 | 6,691 | + 12 | | Cereals | 142 | 990 | 9,489 | 12,474 | + 31 | | General cropping | 92 | 1,254 | 16,746 | 17,875 | + 7 | | Mixed | 102 | 1,272 | 13,596 | 12,567 | - 8 | | Pigs and poultry | 47 | 1,200 | 12,788 | 9,625 | - 25 | | **All types (excluding horticulture)** | 79 | 1,033 | 9,183 | 9,584 | + 4 | | **Wales (275–4199 smd) (b)** | | | | | | | Specialist dairy | 37 | 734 | 4,808 | 5,848 | + 22 | | Mainly dairy | 51 | 799 | 6,197 | 6,959 | + 12 | | Mainly sheep | 48 | 720 | 3,033 | 4,675 | + 54 | | Cattle and sheep | 66 | 672 | 4,667 | 6,064 | + 30 | | **All types (c) ...** | 52 | 730 | 4,692 | 6,028 | + 28 | | **England and Wales (275–4199 smd) (b)** | | | | | | | **All types (excluding horticulture)** | 74 | 986 | 8,501 | 9,044 | + 6 | | **Scotland (275 smd and over) (b)** | | | | | | | Dairy | 65-4 | 1,205 | 8,879 | 9,580 | + 8 | | Hill sheep | 41-7 | 871 | 4,525 | 6,493 | + 43 | | Upland rearing | 73-0 | 773 | 5,401 | 6,289 | + 16 | | Rearing with arable | 75-0 | 742 | 7,335 | 8,768 | + 20 | | Arable, rearing and feeding | 94-0 | 810 | 10,721 | 14,314 | + 34 | | Cropping | 118-2 | 1,250 | 23,959 | 24,911 | + 4 | | Rearing with intensive livestock | 68-5 | 1,042 | 10,217 | 7,437 | - 27 | | **All types** | 78-9 | 996 | 10,639 | 11,728 | + 10 | | **Northern Ireland (d) (200 smd and over) (b)** | | | | | | | Dairy | 29-9 | 597 | 5,352 | 6,475 | + 21 | | Dairy with pigs and poultry | 23-2 | 719 | 6,622 | 7,616 | + 15 | | Cattle and sheep | 36-7 | 450 | 4,000 | 5,415 | + 35 | | Mixed | 40-6 | 579 | 8,175 | 10,031 | + 23 | | **All types (e) ...** | 33-5 | 573 | 5,861 | 7,098 | + 21 | Almost all farm businesses in Northern Ireland are based on owner-occupied holdings. As rents cannot be
Table 25
Public expenditure under the common agricultural policy (CAP) and on national grants and subsidies (a)
| April/March (financial) years | £ million | |------------------------------|----------| | | 1973/74 | 1974/75 | 1975/76 | 1976/77 | 1977/78 (forecast) | | I Price guarantees and production grants | | (i) Price guarantees on products supported by the CAP | | Cereals (b) | 8.8 | | | | | | Milk (c) | 103.2 | | | | | | Cattle | | | | | | | Pigs | | | | | | | Eggs | 5.7 | 0.3 | | | | | Total (i) | 117.7 | 0.3 | | | | | (ii) Price guarantees on other products | | Sheep | | | | | | | Wool (b) | (-5.2) | (-4.3) | 2.0 | (-2.4) | (-2.2) | | Potatoes (b) | 1.0 | 1.6 | 0.5 | 0.8 | 5.6 | | Total (ii) | (-4.2) | 5.8 | 10.0 | (-1.4) | 3.8 | | (iii) Production grants and subsidies | | Dairy Herd Conversion Scheme | 2.1 | 10.0 | 11.8 | 4.4 | 5.7 | | Guidance Premiums | | 0.1 | 0.6 | 2.2 | 7.8 | | Milk Non-Marketing Premiums | | | | | | | Fertilisers | 14.6 | 6.1 | | | 12.0 | | Lime | 4.5 | 4.5 | 4.7 | 4.6 | 0.1 | | Calves | 33.9 | 48.9 | 61.6 | 26.1 | 24.0 | | Beef cows | 9.2 | 22.1 | 8.1 | 10.5 | 3.2 | | Pig subsidy | 29.2 | | 6.2 | 10.6 | | | Oil for horticulture | | 5.6 | 0.3 | | | | Total (iii) | 64.3 | 126.5 | 87.1 | 54.0 | 63.4 | | Total I | 177.8 | 132.6 | 97.1 | 52.6 | 67.2 |
### Table 25 (Continued)
Public expenditure under the common agricultural policy (CAP) and on national grants and subsidies (a)
| April/March (financial) years | £ million | |------------------------------|----------| | | 1973/74 | 1974/75 | 1975/76 | 1976/77 (forecast) | | **II Support for capital and other improvements** | | | | | | Farm and Horticulture Development Scheme (d) | — | 0.1 | 0.8 | 3.7 | 15.6 | | Farm Accounts | — | — | — | — | 0.2 | | Farm Structure | 1.3 | 1.4 | 1.5 | 1.4 | 1.3 | | Farm Capital Grant Scheme (d) | 67.4 | 77.4 | 65.9 | 54.6 | 56.1 | | Grants absorbed by Farm Capital Grant Scheme | 6.9 | 3.3 | — | — | — | | Grants for horticultural (national schemes) | 10.1 | 5.8 | 3.4 | 2.6 | 2.8 | | Co-operation grants | 0.9 | 0.9 | 1.1 | 0.8 | 1.0 | | Others (e) | 1.3 | 1.0 | 1.0 | 0.2 | 0.6 | | **Total II** | 87.9 | 89.9 | 73.7 | 63.3 | 77.6 | | **III Support for agriculture in special areas** | | | | | | Hill livestock: compensatory allowances (f)—cattle | — | — | 6.3 | 43.9 | 26.0 | | Hill livestock: compensatory allowances (f)—sheep | — | — | 10.8 | 38.8 | 24.4 | | Hill cattle | 16.9 | 35.4 | 1.2 | — | — | | Hill sheep | 10.4 | 19.8 | 2.9 | 0.2 | — | | Winter keep | 7.0 | 12.3 | 1.2 | — | — | | Additional benefit under FHDS and FCGS | 4.8 | 3.4 | 5.9 | 7.0 | 7.7 | | Others (g) | 1.6 | 1.7 | 1.8 | 1.2 | 0.8 | | **Total III** | 40.7 | 72.6 | 30.1 | 91.1 | 58.9 | | **Total I, II, III** | 306.4 | 295.1 | 200.9 | 207.0 | 203.7 | | against which receipts from FEOGA guidance section | — | — | 4.4 | 11.6 | 20.1 | | guarantee section | — | — | — | — | 7.2 | | **IV Market regulation under the CAP (h)** | | | | | | Cereals | 21.3 | 13.4 | 46.2 | 29.8 | 4.8 | | Beef and Veal | 1.2 | 63.7 | 113.0 | 16.3 | 9.4 | | Pigment | 19.0 | 24.1 | 38.6 | 12.3 | 0.4 | | Sugar | 2.6 | 45.7 | 41.2 | 71.2 | 89.2 | | Processed products | 9.7 | 14.1 | 3.4 | 8.8 | 17.0 | | Milk products | 29.5 | 35.8 | 61.8 | 24.1 | 74.6 | | Others (i) | 2.3 | 2.6 | 6.5 | 8.9 | 8.5 | | **Total IV** | 85.6 | 199.4 | 310.7 | 171.4 | 203.9 | | against which receipts from FEOGA guarantee section | 76.7 | 169.6 | 259.6 | 168.7 | 146.5 |
(a) This table excludes expenditure which may benefit farmers but where the value to them is not shown by the expenditure (eg expenditure on animal disease and pest control or on research, advice and education). It does, however, include some expenditure which benefits consumers and overseas exporting interests rather than producers (see note (h)). The figures for years up to and including 1975/76 represent actual expenditure recorded in the Appropriation Accounts. The figures for 1976/77 are subject to confirmation and those for 1977/78 are the latest estimates of expenditure.
(b) Payments in respect of cereals, wool and potatoes relate partly to the crops or clips of the year indicated and partly to the crops or clips in the preceding year or years. The figures shown in brackets reflect the arrangements with the British Wool Marketing Board, whereby deficiency payments made by the Exchequer are repayable from surpluses (excess of market price over guaranteed price) up to the amount of debt owing by the Board to Ministers. (c) Payments on milk reflect the Government policy of holding down the retail price of milk. For public expenditure purposes, they have been attributed to expenditure under the price guarantees in 1973/74 and shown in the body of the table above, but for subsequent years the expenditure has been attributed to the food subsidies programme.
(d) Farmers in special areas are also eligible for additional assistance under the Farm and Horticulture Development Scheme and the Farm Capital Grant Scheme. The estimated benefit is shown separately in section III of the table.
(e) Includes grants in respect of investment on self-propelled machines (agricultural and horticultural), credit\*, forage groups\*, small horticultural production businesses\*, small farmers, farm business records, water supply\*, agricultural drainage\*, special assistance to livestock producers\* and hops restructuring. (Provision for the schemes marked * was included in the 1977/78 Supply Estimates.)
(f) Some unavoidable delay in payments in 1975/76 resulted in a carryover of £16.4 million into 1976/77.
(g) Includes grants for improvement of hill land and livestock rearing land\*, rural roads\*, producers in the Scottish Islands\*, crofting improvements\*, hill cattle agistment subsidy and hill livestock and young stock scheme\*. (Provision for the schemes marked * was included in the 1977/78 Supply Estimates.)
(h) The figures shown are total expenditure before allowing for receipts from FEOGA which are shown separately at the foot of the table. The figures are made up of several elements and include import refunds (net of export levies) on intra-Community trade, import and export refunds on third country trade, the beef premium scheme, aid for private storage and animal feed, certain production subsidies and the net cost of commodities bought into intervention and subsequently sold. The figures for 1974/75, 1975/76 and 1976/77 include the special import subsidy on sugar. Much of the expenditure benefits consumers and overseas exporting interests rather than producers. The consumer subsidy on butter is not included.
(i) Includes eggs, poultrymeat, fruit and vegetables, oilseeds, hops, heritage seeds, dehydrated fodder and fisheries. Also includes expenditure on products covered by the CAP but not produced to any significant extent in the United Kingdom (rice, wine, flax and hemp).
______________________________________________________________________
**TABLE 25 (Continued)**
| Description | £ million | |-------------|-----------| | Net cost change relating to all products | +322.5 |
______________________________________________________________________
**TABLE 26**
Aggregate cost changes since the 1977 Annual Review (a)
| Description | £ million | |-------------|-----------| | Feedingstuffs | -62.2 | | Seeds | -24.6 | | Imported livestock | +7.6 | | Fertilisers and lime | +48.6 | | Machinery (including depreciation) | +175.5 | | Maintenance (including depreciation on equipment) | +15.4 | | Miscellaneous | +58.1 | | Labour | +111.9 | | Gross rent | +33.9 | | Interest | -58.0 | | Transport and marketing | +16.3 |
(a) These estimates are made on the assumption that any change in the cost of an item of expenditure will continue for a full year and that there will be no change from the current usage of that item. They include the effect of all cost changes known up to 6 December 1977.
### Commodity price trends
This table gives indications of the movement in commodity prices at the first point of sale. The series do not always show total receipts by farmers; for some commodities additional premiums or deficiency payments were made to achieve support price levels.
#### Calendar years
| Commodity | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |-----------|-------|-------|-------|-------|-----------------| | Wheat (£ per tonne) | Average ex-farm price (a) | 45.77 | 59.88 | 55.96 | 72.39 | 83.24 | | Barley (£ per tonne) | Average ex-farm price (a) | 41.64 | 56.99 | 57.77 | 73.63 | 77.01 | | Oats (£ per tonne) | Average ex-farm price (a) | 37.34 | 53.97 | 55.08 | 67.74 | 73.49 | | Rye (£ per tonne) | Average ex-farm price (a) | 41.4 | 56.0 | 61.1 | 76.0 | 75.0 | | Hops (£ per tonne) | Average farm-gate price (b) | 828 | 876 | 1,074 | 1,360 | 1,360 | | Potatoes (£ per tonne) | Average farm-gate price (c) | 20.7 | 23.6 | 56.8 | 143.4 | 70.0 | | Sugar beet (£ per tonne) | Producer price (d) | 9.41 | 13.96 | 18.41 | 19.58 | 20.27 | | Apples (£ per tonne) | Average market price (e) | 121 | 150 | 175 | 191 | 345 | | Pears (£ per tonne) | Average market price (e) | 144 | 152 | 185 | 189 | 255 | | Tomatoes (£ per tonne) | Average market price (e) | 212 | 237 | 291 | 346 | 420 | | Cauliflowers (£ per tonne) | Average market price (e) | 73.3 | 91.7 | 121.5 | 119.2 | 137.2 | | Cattle (store) (£ per head) | 1st quality Hereford/Friesian bull calves (f) | 64 | 41 | 40 | 56 | 63 | | | 1st quality yearling steers beef/dairy cross (f) | 123 | 97 | 110 | 157 | 174 | | | clean cattle (g) | 37.35 | 33.12 | 38.51 | 52.43 | 58.09 | | Sheep (store) (£ per head) | 1st quality lambs, hoggets and tegs (f) | 13.6 | 12.0 | 14.0 | 19.0 | 24.0 | | | 70.5 | 64.6 | 75.4 | 103.9 | 125.9 | | | (p per kg estimated dressed carcase weight) | 43.79 | 45.98 | 61.90 | 67.32 | 71.47 | | Pigs (£ per kg deadweight) | Average market price (f) | 43.79 | 45.98 | 61.90 | 67.32 | 71.47 | | Broilers (p per kg) | Average wholesale price | 42.9 | 45.8 | 55.0 | 63.6 | 75.9 | | Milk (p per litre) | Average net return to producers (f) | 5.09 | 6.28 | 7.98 | 9.37 | 10.14 | | Calendar years | 1973 | 1974 | 1975 | 1976 | 1977 (forecast) | |----------------|------|------|------|------|-----------------| | **Eggs** (p per dozen) | Average producer price (k) | 23.7 | 24.6 | 22.8 | 27.8 | 31.3 | | **Wool** (p per kg) | Average producer price for clip (f) | 46.7 | 48.2 | 57.1 | 69.5 | 95.5 |
(a) Weighted average ex-farm prices of UK cereals. (b) Average farm-gate prices paid by Hops Marketing Board to growers in England. Hops are not grown elsewhere in the UK. (c) Weighted average price paid to growers by registered merchants for early and main crop potatoes in the UK. (d) Average price paid to growers in the UK by the British Sugar Corporation for sugar beet with a standard sugar content of 16%. (e) Weighted average wholesale prices for England and Wales. (f) Average prices at representative markets in England and Wales. (g) Based on auction market prices up to April 1973, and thereafter on Meat and Livestock Commission all clean cattle prices. (h) UK weighted average market price for animals certified under the Fatstock Guarantee Scheme. (i) UK average market price for clean pigs. (j) Derived by dividing total value of output (Table 21) by the total quantity of output available for human consumption (Table 15). (k) Average price of all Class A eggs weighted according to quantity in each grade. (l) Average price paid to producers by the British Wool Marketing Board. CABINET
MEMORANDUM FOR LIAISON COMMITTEE ON EXCHANGE CONTROL
Note by the Chancellor of the Exchequer
At a meeting of the Ministerial Committee on Economic Strategy in December I was invited to put to the Cabinet an information paper on exchange control which could be circulated to the Parliamentary Labour Party/Trades Union Congress Liaison Committee. I attach a memorandum for this purpose which is intended to describe briefly why our exchange control regime developed in its present form; to explain the reasons for the limited changes made recently; and to outline the arguments which are being advanced for and against further changes in terms which will not unsettle the markets or pre-empt Cabinet discussion by appearing to imply the direction of future Government policy. I should be glad to know if my colleagues agree that this is a suitable paper for discussion by the Liaison Committee at their meeting on Monday 23 January. I would propose also to circulate as background to the Liaison Committee the Treasury Economic Progress Report of September 1976, containing an article on the economic impact of foreign investment, "International Investment and the Balance of Payments", a copy of which I also attach.
D W H
Treasury Chambers
16 January 1978 UK EXCHANGE CONTROL
General
The broad objective of exchange control is to conserve the UK's holdings of gold and foreign currency, and to assist the balance of payments. Its purpose has been to protect our external position rather than directly to influence the domestic economy.
2. Exchange control was first introduced in 1939 under Defence Finance Regulations. It has remained a feature of the British economic scene ever since, under the 1947 Exchange Control Act, which was amended in minor respects in 1968 and 1977. The Act prohibits a wide range of transactions in gold, foreign currency, and securities, except with Treasury permission, and empowers the Treasury to make orders and give directions.
3. The powers under the Act have been used with varying degrees of severity, reflecting changing economic needs, during the 30 years since 1947. Because they have been extended to the sterling area, and because exchange control has been applied to the use of sterling in third country trade since 1976, the controls as a whole are still more stringent than at any time in the 1960's, even after the changes announced in October and December 1977.
4. The administration of the control has been largely delegated to the Bank of England, to be carried out in accordance with the policy of the Treasury at the time, and the Bank in turn devolve functions to authorised banks, and to authorised depositaries in respect of securities. The aim has to be to enable millions of individual transactions, whether for trade, or investment, or personal affairs, to take place with the minimum of friction. consistent with protecting the balance of payments. The control must rely on the co-operation of those it affects, and must be intelligible and credible, as well as seen to be administered fairly.
What the controls are
05. Current payments - ie for imports of goods and services - are generally unrestricted, as they have to be for the free flow of trade. But they may be monitored to check that they are not being used as channels for unauthorised capital movements. And there are controls which try to secure that money which is due from abroad is made available to the reserves in good time, and that payment for goods and services from abroad consists only of what is due, and is not made too soon.
06. The control therefore applies mainly to capital transactions:
(a) UK residents cannot use official exchange to add to the global stock of portfolio investment in foreign currency securities;
(b) direct investment overseas, with some exceptions, is not allowed to be financed with official exchange;
(c) a variety of personal transactions is controlled largely to prevent their use for capital exports which would otherwise not have been permitted.
07. In addition, the foreign currency required by institutions in the private sector like banks and insurance companies, is supplied only in accordance with rules laid down from time to time.
08. The purpose of the controls on outward direct investment is to ensure that it is financed in a way which minimises or eliminates the initial cost to the reserves. The finance can be found from borrowing in foreign currency or from profits which companies are allowed to retain abroad. Official exchange is provided only under the so-called "super-criterion" scheme, which ensures that an equivalent amount of foreign exchange is remitted back to the UK within a prescribed short period, and that there is a continuing return in foreign currency.
09. UK residents cannot buy foreign securities at the expense of the reserves. Generally speaking they can obtain them only if another UK resident is prepared to dispose of such securities. Since the effect of that is a fixed stock, a buyer must be ready to pay a premium - the investment currency premium - to persuade another resident to make a disposal. Recent changes
10. The improvement in our external accounts in 1977 made it possible to make some changes, particularly in areas of exchange control which were introduced to meet a crisis and brought short term benefit to the reserves at a cost to the economy as a whole; and in some controls on personal transactions which were no longer necessary to protect our reserves and which affected individuals unfairly.
11. For example, on 26th October, 1977, we made a change to encourage foreign investment in Britain. Instead of insisting that such investment should be financed in part by bringing in foreign exchange, we permitted all non-resident controlled manufacturing companies in the UK (instead of only some, e.g. from the EEC) to borrow sterling in the UK for their UK business without restriction as to the amount, or to the region in which they were investing.
12. To help our insurance companies and banks to compete for foreign business on equal terms and thus increase our invisible earnings, we made some relaxation in the rules governing the working balances which insurance companies, banks, and merchants, could hold in foreign currency instead of sterling, in relation to their foreign currency business.
13. In addition, certain limits on personal transactions were raised to make some allowance for inflation and depreciation.
14. Other changes were announced in December to take effect from 1st January 1978 in order to secure the necessary EEC authorisations for continuing the main structure of our exchange controls; they were designed to help our economy by meeting the objectives described in paragraph 10. Besides raising the limits for some personal transfers within the EEC, we decided:
(a) To lengthen from 18 months to 3 years the period during which equivalent foreign exchange must accrue under the "super-criterion" and to increase the limit permitted per project from £250,000 to £500,000. This relaxation should help British firms - particularly smaller ones - to to penetrate EEC markets and thus create more jobs at home;
(b) To end the rule under which 25 per cent of the foreign currency receipts from sales of foreign currency securities must be sold on the financial market. This arrangement was helpful in times when the reserves were under great pressure. But there is no longer any need to enforce a transfer of about £200 million a year from private holdings to the reserves, especially as the rate of return we can earn on the reserves is not as high as we can earn abroad. UK holders are now free to switch from less profitable to more profitable overseas securities without incurring a substantial penalty in doing so. This will add to the total of UK assets abroad and increase our future income from them.
The future
15. Any further changes in exchange control will have to be related not only to the development of the current balance and the reserves but also to the needs of the economy as a whole, as determined in particular by the course of the exchange rate and the level of economic growth at which we aim. It is important that the balance of advantage from any changes should lie with the UK.
16. One issue under current discussion is the effect which the existence of exchange controls may have on the level of the exchange rate. Other countries with strong external positions do not have major controls against outflows. It is argued that these controls by limiting the supply of sterling in relation to the demand for it may produce a higher exchange rate - as indeed is their purpose when sterling is under pressure - and that if sterling rises beyond a certain point it will reduce our competitiveness and increase unemployment. A number of arguments are adduced on the other side - that the impact on the exchange rate is only marginal, that the appreciation of sterling by reducing inflation will improve our economic performance, that we cannot yet be confident that we shall maintain our current account surplus through the eighties, and that because the UK economy and financial system are exceptionally open such controls are more necessary here than in some other countries.
17. Another issue is the effect on outward direct investment on investment and jobs in the UK. It is argued on the one hand that a high proportion of direct investment overseas is likely to have a positive net effect on UK exports, and thus to improve not only the balance of payments but also employment at home. In addition, UK investment overseas will increase the flow of invisible earnings and support our economy in the future. On the other hand it is argued that investment at home must increase jobs more directly and produce a higher social return than investment overseas.
18. This raises the question whether withholding official exchange for outward direct investment does in fact produce higher investment at home. The 1967/8 Reddaway Report came to the conclusion that investment abroad from 1955 to 1964 led to an increase in exports. In conditions of less than full employment this implies some increase in jobs and probably in investment inside the UK. Evidence so far available on the situation today does not throw much light on the extent to which decisions to invest at home or overseas are, in practice, alternatives, or are conflicting or complementary. We hope that the work being done in sector working parties under NEDC as part of the Industrial Strategy will throw some further light on this. International investment and the balance of payments
For many years now there has persisted an undercurrent of public concern about the effect of UK investment overseas on the balance of payments. Despite the exchange controls at present in force, some critics continue to argue that the UK is "exporting capital" on a massive scale, to the detriment of the official reserves, the balance of payments generally or the exchange rate, with the result that the Government is forced to run the economy at a lower pressure of demand, and higher level of unemployment, than would otherwise be necessary. In fact, criticisms on these lines are usually based on misunderstanding.
The net additions to our overseas investments in recent years have been financed in such a way that the reserves have been fully protected, and the net effect on the balance of payments of all the identified items connected with international investment - past and present - has been both favourable and massive, averaging some £2½ billion a year over the last three years. Such an outcome is virtually guaranteed by our exchange control rules.
This article begins by explaining briefly the effects of the present exchange control rules. It then shows how a quick reading of the normal balance of payments accounts can lead to misunderstandings. Finally, it presents the figures in a new way which brings together all the identified items in the balance of payments accounts relating to international investment.
Effect of present exchange controls
The authorities do not restrict overseas investment as such, but they do restrict the ways in which companies can finance it. The main features of the current rules on direct investment are as follows.
i. Companies are allowed to finance only a very small proportion of investment with foreign currency out of the official reserves: the only projects which can be so financed to a limited extent are those which meet the "super-criterion", that is to say projects which directly promote exports of goods and services and will bring benefits to the balance of payments equal to the cost of the original investment within a period of eighteen months, and continuing thereafter.
ii. Other direct investments must be financed in ways which minimise or eliminate the cost to the reserves. In practice, almost all such investment is financed by borrowing foreign currency (either direct from overseas banks or through UK banks) or out of profits retained overseas, and in neither case is there any net outflow across the exchanges.
iii. When companies finance their direct investment by foreign currency borrowing this has to be repaid in due course. To protect the reserves, the regulations require that the amounts repaid out of official exchange do not exceed the inflows of funds resulting from the investment.
iv. The UK controlled subsidiaries and branches overseas are required to remit to the UK a large proportion of their profits. The general rule is that at least two-thirds of net taxed earnings must be remitted, although detailed arrangements vary with the type of company and host country regulations. The statistics in balance of payments publications do not appear to bear this out (eg "unremitted profits" amount to more than one-third of total direct investment earnings). But this is largely because exchange control applies only to companies where voting control lies within the UK, whereas the balance of payments statistics include also figures for earnings of overseas companies where the UK interest is a minority; and because remittances of royalties, management fees and certain other earnings count towards the two-thirds requirement, while stock appreciation is generally disregarded in calculating earnings. In practice, many UK-controlled companies remit much more than two-thirds of their net earnings.
The broad effect of rules (i) - (iii) above is that "new" overseas investment (net) by UK companies cannot cost the reserves a significant amount. Rule (iv), on the other hand, ensures a substantial and continuing inflow of funds to the UK from our existing overseas investments.
As far as portfolio investment overseas is concerned, this too is regulated by exchange control and may be undertaken, with permission, in only two ways - either by foreign currency borrowing as above or through the use of "investment currency". The investment currency market is primarily a mechanism to enable portfolio investments in foreign currency securities to be transferred among UK residents. In addition, the requirement to surrender 25 per cent of the sale proceeds at the official rather than at the investment currency rate ensures a continuing benefit to the balance of payments.
Sources of misunderstanding
Despite the rules just described, the impression remains quite widespread that we are exporting capital on a massive scale for investment overseas. How does the misunderstanding arise?
It seems to arise in part from the item in the capital account of the balance of payments called "private investment overseas", which typically carries every year a very large negative entry, or an "outflow" in balance of payments terms. It is often assumed that these "investments" can be compared with investment in machinery, plant and buildings in the UK and that they are draining away the reserves.
In fact, both assumptions are false. "Overseas investment" includes not only fixed investment of the kind just mentioned but also stockbuilding, stock appreciation and other transactions of a financial nature such as additions to or repayments of working capital, other loans and trade credit and transactions in securities. On the other hand, the figures are expressed net of disinvestment. It is thus quite wrong to compare "investment" figures in the balance of payments accounts with "gross domestic fixed capital formation" figures in the national income accounts, which correspond to one of the popular usages of the term "investment".
The second assumption - that the entries under "private investment overseas" show the effect on the reserves of overseas investment - is likewise mistaken. To assess the overall effect on the balance of payments, it is necessary to take account of a number of entries in the balance of payments accounts, relating to the financing of overseas operations - notably borrowing in foreign currency for use overseas and profits etc retained overseas (or "unremitted" profits). When this has been done, it can be seen that the statistics confirm that the exchange control rules are indeed fulfilling their intended function of protecting the reserves and promoting a substantial annual inflow of income from past investments.
A hypothetical example
A simple example may help to illustrate the interrelationship between the various balance of payments entries just mentioned.
Let us suppose that an overseas subsidiary remits £1,000 of profits to the UK, thus increasing the official reserves by this amount. The figure of £1,000 will not appear as such in the summary balance of payments accounts. Instead, the total profits earned overseas (say £1,500) will be entered as a credit under "interest, profits, dividends etc" in the current account and the unremitted element (£500) will appear as a contra-entry in the capital account under "private investment overseas". There are in fact good reasons for presenting the accounts in this way, which follows accepted international practice.
Matters become more complicated if in addition the UK parent has borrowed (say) £750 of foreign currency from a UK bank to finance its overseas operations. In that event the "outflow" under "private investment overseas" will appear even larger (£500 plus £750 equals £1,250), although there will be an offsetting "inflow" of £750 elsewhere in the capital account under "foreign currency borrowing by UK banks". The only direct effect on the reserves is the £1,000 of remitted profits, but the accounts will show:
| Current account | £ | |-----------------|---| | Private investment overseas | -1,250 | | Foreign currency borrowing by UK banks | +750 | | **TOTAL** | **+1,000** |
If the reader of the accounts is unaware of the related entries under the current account and foreign currency borrowing by UK banks, it is quite understandable that he may interpret the £1,250 under private investment overseas as a "capital outflow" or "export of capital".
The example just described, and the effect on the reserves, can be shown more fully as follows.
| Current account items | £ | |-----------------------|---| | Earnings of interest, profits, dividends etc | 1,500 | | of which: unremitted profits | 500 | | **therefore: effect on reserves** | **1,000** |
| Capital account items | £ | |-----------------------|---| | Private investment overseas (net) | -1,250 | | of which: financed by unremitted profits and trade credit | -500 | | **therefore: other investment to be financed** | **-750** | | Foreign currency borrowing to finance investment | 750 | | **therefore: effect on reserves** | **1,000** | | **Overall effect on the reserves** | **1,000** |
**assumed to be zero in this example**
A now presentation
It might be asked - why not score in the current account only remitted profits, and not total profits? There would then be no need for the negative contra-entry in the capital account, which apparently causes misunderstanding. Such an approach, however, would not be consistent with the form of accounting recommended by the IMF and would be open to serious objections. It would misallocate items between the current and capital accounts and would lead to an understatement of both the invisibles surplus and gross national product.
An alternative way of showing more clearly the effect on the balance of payments of international investment is to leave the main accounts as they are but have an additional table on the lines of that used in connection with the example discussed above - a table which brings together all the identified items in the balance of payments accounts which relate to international investment, and shows the combined effect of these items. Such a table would not, of course, show the total effect of overseas investment on the reserves: for this purpose it would be necessary in addition to estimate the effects of overseas investment on UK trade (a problem tackled in the Reddaway Report), and possibly to allow for effects on the exchange rate. With these qualifications, however, a table which brings together all
- Table 20 of the CSO's UK balance of payments 1963-75 (the "Pink Book") already shows much of this material.
† W. D. Reddaway, Effects of UK direct overseas investment: final report, Cambridge University Press, 1968. EFFECT ON RESERVES OF IDENTIFIED BALANCE OF PAYMENTS ITEMS ASSOCIATED WITH INTERNATIONAL INVESTMENT
(implies a transaction favourable to the reserves)
| UK PRIVATE INVESTMENT OVERSEAS\* | 1973 | 1974 | 1975 (provisional) | |---------------------------------|------|------|-------------------| | Current (invisibles) account items | | | | | 1 Interest, profits and dividends | +2,492 | +2,545 | +2,225 | | 2 of which unremitted profits | +535 | +560 | +1,018 | | 3 therefore effect on reserves | +1,957 | +1,985 | +1,207 | | 4 Net receipts from services and royalties | +106 | +125 | +147 | | 5 Interest payments on foreign currency borrowing for investment overseas | -225 | -275 | -350 | | 6 therefore effect on reserves of 1-5 | +1,436 | +1,548 | +1,094 | | Capital account items | | | | | 7 UK private investment overseas (net) | -1,855 | -1,169 | -1,405 | | 8 of which financed by unremitted profits | -535 | -560 | -1,018 | | 9 therefore | -1,320 | -1,609 | -2,423 | | 10 Other net investment to be financed | -741 | -110 | -142 | | 11 Foreign currency borrowing for investment overseas (net) | -762 | +410 | +450 | | 12 therefore effect on reserves of 7-11 | +11 | +520 | +324 | | 13 Combined effect of current and capital account items (6 plus 12) on reserves | +1,449 | +2,069 | +1,328 |
OVERSEAS INVESTMENT IN UK PRIVATE SECTOR
Current (invisibles) account items | | | | |---------------------------------|------|------|-------------------| | 14 Interest, profits and dividends | -792 | -700 | -711 | | 15 of which unremitted profits | -414 | -378 | -477 | | 16 therefore effect on reserves | -136 | -161 | -151 | | 17 Net payments for services and royalties | -614 | -633 | -625 | | 18 therefore effect on reserves of 14-17 | -602 | -660 | -614 | | Capital account items | | | | | 19 Overseas investment in UK private sector (net) | +1,595 | +2,356 | +1,760 | | 20 of which financed by unremitted profits | +414 | +231 | +277 | | 21 therefore effect on reserves | +280 | +116 | +80 | | 22 Direct borrowing abroad (net) to finance overseas investments | +274 | +220 | +203 | | 23 therefore effect on reserves of 19-22 | +862 | +1,660 | +1,164 | | 24 Combined effect of current and capital account items (18 plus 23) on reserves | +348 | +1,022 | +569 | | 25 TOTAL EFFECT ON RESERVES (13 plus 24) | +1,757 | +3,088 | +1,887 |
FOOTNOTES
01. Net of disinvestment. The figures cover direct, portfolio, oil and miscellaneous investment. Further details of the identified capital transactions associated with UK investment overseas are given in table 20 of "United Kingdom Balance of Payments 1965-75" (the "Pink Book"). UK private investment overseas excludes the transactions of certain public corporations.
02. Comprises private sector credits ("Pink Book" table 12) less interest on unrelated export credit, net Eurocurrency earnings, sterling claims, and discount earnings; plus the earnings of certain public corporations.
03. Comprising unremitted profits of affiliates (net) other than that part of unremitted losses caused by dividends exceeding profits.
04. Excluding those of oil companies. These are included within interest, profits and dividends.
05. Rough estimates.
06. Including funds surrendered to the UK official reserves under the 25 per cent surrender scheme: 1973: £158 million; 1974: £265 million; 1975: £180 million.
07. Gross amounts of trade credit extended to and received from overseas affiliates or parents. Such trade credit extended by oil companies cannot be identified.
08. Excluding the effect of certain unidentified transactions, notably the effect of investment by oil companies in the form of trade credit.
09. Comprises private sector debits ("Pink Book" table 13) less interest on issues abroad and on direct borrowing abroad for use abroad, and interest on sterling liabilities and on import credits.
10. Direct borrowing abroad, net of repayments (including net issues abroad) used for financing UK private investment overseas. This is conventionally included in overseas investment in UK private sector (line 19), as well as in line 11, and has therefore to be deducted.
11. Excluding sterling borrowing from UK banks by overseas companies for investment in the UK, which is generally prohibited by Exchange Control. The amount of this borrowing is thought to be small.
The relevant identified flows in the accounts ought at least to prevent the misunderstandings which result from unfamiliarity with the accounts.
The table above has been constructed on these lines and gives figures for the last three years. The upper part of the table corresponds closely to the second of the tables illustrating the hypothetical example discussed earlier. The first section of the table, headed "Current (invisibles) account items", gives the total earnings on our overseas investments and then shows the amounts remitted to the UK (line 6). The second section, headed "Capital account items", shows the net additions to our investments during the periods in question and the extent to which these additions were financed without call on the official reserves - from earnings retained overseas, trade credit from parent companies, foreign currency borrowings etc. The residual item in line 12 then shows the extent of any cost, or benefit, to the reserves. Because investment is calculated net of disinvestment, the overall effect as shown in this line may actually be favourable. The lower part of the table shows comparable figures for overseas investment in the UK private sector.
As can be seen, the table immediately highlights the fact that if one looks at all the identified balance of payments transactions associated with UK private investment overseas, the net effect on the balance of payments has been both favourable and massive—averaging over £1½ billion a year in the last three years. Moreover, this benefit to the reserves becomes still larger—averaging some £2½ billion a year over the same period—when account is taken of overseas investment in the UK private sector. The table also brings out clearly how unremitted profits, or profits retained overseas, contribute to the financing of overseas investment, and in particular how in the last three years the net additions to our overseas investments have been financed in such a way that the overall effect on the reserves has actually been favourable. CABINET
THE GREEN POUND
Memorandum by the Minister of Agriculture, Fisheries and Food
1. We need to consider whether to make an immediate green pound devaluation in the light of parliamentary pressures and the negotiating position on Common Agricultural Policy (CAP) prices in Brussels.
2. There is now a strong case for action to improve the United Kingdom farm support price levels and to ease the problems which excessive MCA (monetary compensatory amount) export subsidies on supplies from other European Economic Community (EEC) countries are causing for the meat processing industry and which could lead to more than three thousand further redundancies. The Annex summarises the key facts including the effects on food prices. Although agriculture has had a much better year in 1977 the underlying trends are unsatisfactory with the beef and pig breeding herds in particular showing sharp declines. The difficulties of these two sectors are due in large measure to their having to compete in the United Kingdom market with highly subsidised imports of Danish bacon and Irish beef. The dairy herd is now also starting to fall and investment in agricultural buildings and works is continuing to fall.
CAP PRICE NEGOTIATIONS
3. In accordance with our strategy towards the CAP our main objective in the price negotiations will be to hold down increases in common prices as close as possible to the average of 2 per cent proposed by the Commission. An increase of this order will not be sufficient to maintain the productive base of our own agriculture and we will need to add to it by devaluing the green pound by 5 per cent or more leaving us with an MCA gap of about 23 per cent. The improvement in the competitiveness of our meat industry afforded by a reduction in the MCAs which would result from an immediate 5 per cent devaluation is, in my view, the minimum that is needed if we are to have a real prospect of arresting the continuing decline in our pig and beef breeding herds. This devaluation would reduce the MCA subsidy on Danish bacon imports by £43 per tonne (a cut of about 18 per cent) and the net MCA subsidy on Irish beef imports by £60 per tonne (a cut of about 20 per cent). There are, moreover, great negotiating advantages in making this devaluation before the Council starts its discussions on CAP prices. This year, with no further transitional steps to increase our support prices and with well known problems in certain sectors the other member states will know that we require more than the 2 per cent common price increase. We need therefore to try to get the green pound issue taken out of the price-fixing to avoid it becoming a lever which other member states can use to achieve their objective of higher common prices. The French and the Italians, to strengthen their own tactical positions, are making green currency devaluations before the negotiations and if we do the same it will strengthen the general case against increased common prices.
THE PARLIAMENTARY SITUATION
4. We have to decide how to deal with the Opposition motion to be debated on 23 January calling for an immediate devaluation of 7½ per cent. The minor parties seem certain to support this and we run a very real risk of defeat if we cannot announce some change in the green pound. We could, of course, make no immediate change and continue to argue that it is for the Government to judge when and by how much to make a devaluation; if we were defeated we could blame the other parties for the food price increases which would follow. But I would strongly oppose our surrendering the initiative in this way. The credibility of our line on the green pound depends on our being prepared to make some move when circumstances justify it. If we could announce a 5 per cent change it would be very difficult for the Opposition to argue that it should have been greater and we would have effectively defused an issue which will otherwise cause us continuing criticism and embarrassment over the coming months.
TIMING
5. We will need to move quickly to persuade the Commission to table a proposal in time for the Council meeting on 23-24 January.
CONCLUSION
6. I invite the Cabinet to agree that I should immediately ask Commissioner Gundelach to table a proposal at the Council on 23-24 January for a 5 per cent green pound devaluation to be effective on 1 February.
JS
Ministry of Agriculture, Fisheries and Food
16 January 1978 ECONOMIC DATA
Agriculture - general position
Agricultural production has increased by about 25% in 1977 as a result of better weather. The index of net product (1975 = 100) is as follows:
| Year | 1973 | 1974 | 1975 | 1976 | 1977 | |------|------|------|------|------|------| | | 113 | 114 | 100 | 89 | 112 |
Farm incomes (excluding stock appreciation) are expected to increase by 16% in money terms in 1978 from £1158 million to £1348 million. In real terms they will have remained about the same.
Cost increases in 1977 were much less than in the previous year. The estimated figure is £322.5 million compared with total inputs of £5,500 million.
The volume of new investment in agriculture is as follows:
| Year | 1973 | 1974 | 1975 | 1976 | 1977 | |------|------|------|------|------|------| | Buildings & Work | 104 | 100 | 79 | 64 | 61 | | Plant & Machinery | 91 | 100 | 93 | 101 | 100 | | Total | 97 | 100 | 87 | 85 | 83 |
Main commodity production trends
Milk production in 1977 was some 42% higher than in 1976 with the increase coming largely from much better yields. The dairy herd expanded by 1% between June 1976 and June 1977 but is now contracting again. Beef production in 1977 is forecast to be about 5% less than in 1976. The specialist beef breeding herd fell by 4% between June 1976 and June 1977 and is still declining.
Pig production is still falling. The breeding herd fell by 7% between June 1976 and June 1977.
Cereals production reached a record level at nearly 17 million tonnes. The acreage was higher than in 1976 but below earlier levels. There was no improvement in sugar beet acreage but production is expected to have increased by over 30% as a result of much better weather.
Net margins in agriculture
Officials have made a preliminary examination of the possible level of returns to agriculture in 1978 and it is considered that for net margins to be maintained at recent levels the following ranges of percentage increases in support prices are indicated for the main commodities:
| Commodity | Range | |-------------|-------| | Wheat | 7-9 | | Barley | 5-8 | | Sugar Beet | 6-7 | | Beef | 7-10 | | Milk | 4-5 |
on total returns which can be achieved either by 10% increase on manufacturing prices (which are affected by the green pound) or by a combination of a smaller manufacturing price increase and some later change in the liquid price. Employment
Total employment in the meat processing industry is estimated at 45,000 of whom about 22,000 are in the pigmeat sector. There have already been 3,000 redundancies in this sector since mid-1976 and there are at present applications for Temporary Employment Subsidy covering a further 3,300 jobs.
Estimated effects of 5% devaluation on retail prices of main foodstuffs
A 5% devaluation would increase the cost of food to the consumer by about 1% after all the effects had worked through. The effect on the all items Retail Price Index would be an increase of about 1%.
Retail price change for the main commodities
| Commodity | Change | Effect | |-------------|--------|---------------------------------------------| | Butter | + 3p lb| Effect not likely to be seen until autumn owing to existence of large stocks of butter and cheese | | Cheese | + 3p lb| | | Beef | + 2p lb| | | Bacon & ham | + 1p lb| | | Bread | + 1p standard loaf | | | Sugar | + 1p kg| |
Public Expenditure
MAFF forecast on a full year basis small savings in public expenditure, taking account of our net contributions to the EEC and expenditure programmes in the UK, although the outcome depends on increased intervention. (Receipts on agricultural levies, accruing to the Exchequer, would also increase). APPROXIMATE INCREASES ARISING FROM A DEVALUATION EARLY IN 1978 OF THE GREEN POUND (£ million) EFFECTS IN A FULL YEAR
| | UK producer's returns | UK consumers' expenditure | UK exchequer receipts | UK foreign exchange costs | FEOGA expenditure | |----------------------|------------------------|---------------------------|-----------------------|--------------------------|-------------------| | | Before feed | After feed | | | | | 5% devaluation | 152 | 115 | 185 | 22 | 32 | -62 |
Notes
1. The estimates are based on quantities of production, trade and consumption forecast for the marketing years of 1978/79.
2. Increases in institutional prices are assumed to be fully reflected in market prices, except for beef, where only a minor part of the increase is likely to be reflected because of an expected hardening of the market during 1978, and for sugar, where the BSC has already set a price for 1978 contracts. Increased returns to beef producers are net after higher costs of imported Irish stores.
3. The devaluation is assumed to affect directly only the price of milk for manufacture, accounting for about half of milk delivered from farms.
4. On these bases a 5% devaluation might ultimately add about 1% to the average retail price of food. The effects on the average retail price of all items would be about one-quarter of 1%. The full effects on food prices from a devaluation on 1 January would only appear in the course of 1978, as distributors worked off stocks, and as prices of intensive livestock products adjusted to higher feed costs.
5. Although the immediate effect on foreign exchange expenditure of the UK would be adverse, there would ultimately be some saving in foreign exchange expenditure, as higher prices here stimulated production, reduced consumption, and so led to a fall in quantities of imported food.
6. Following the decision, in July 1974, to abandon the Maplin airport project, we initiated a wide-ranging review of airports policy. The aim was to devise a policy for Great Britain as a whole rather than to rely on piecemeal solutions and also to ensure that all those affected by airport developments should be involved in the formulation of policy. A consultation document, in two parts, was produced to assist this process. Part 1, published in November 1975, dealt with airports in the London area and Part 2, published in June 1976, considered airports in the rest of Great Britain. Over 600 organisations and many individuals made representations on these documents and Ministers held meetings with the more important organisations.
7. A White Paper setting out the Government's future airports policy is attached. A draft of the White Paper was considered by the Ministerial Committee on Economic and Industrial Policy on 14 December 1977. Following clearance by Cabinet, the Committee agreed that the White Paper should be published subject to amendment of the reference to the significance of airports strategy for regional development; to the inclusion of a more forthright statement about the abandonment of Maplin; and to further consultation between the Secretary of State for Scotland and me about the Highlands and Islands aerodromes. The draft has been amended to take account of the first two points. With regard to the Highlands and Islands aerodromes, subject to one exception, I agree with the Secretary of State for Scotland that the future arrangements for these aerodromes should be left for the Scottish Assembly to consider. Sumburgh, in the Shetland Islands, is vital to the oil industry and the exceptional growth of traffic there presents management problems beyond the experience and abilities of the Civil Aviation Authority (CAA) which now operates the aerodrome. These problems are likely to become more acute and to require aerodrome management skills which can only be provided by the British Airports Authority. In my view, responsibility for Sumburgh should be transferred as quickly as possible to the British Airports Authority. I invite colleagues to consider this issue. If the conclusion is that Sumburgh should be transferred to the British Airports Authority the square brackets in paragraphs 142, 143 and 163 would be deleted. On the other hand if it is decided to leave the aerodrome with the CAA the sections in square brackets would be deleted.
8. The White Paper is long, though no more so than previous White Papers dealing with airports. In the light of the extensive consultations, I believe it is important that the Government's statement should recognise the main arguments that have been deployed and within that context explain the content of the proposed strategy. Sections 1-3 provide a basic framework against which decisions relating to particular airport developments should be considered. I hope that this will provide a guide to policy for many years to come. Section 4 contains decisions which are necessary now on particular developments. Section 5 is a summary of the principal issues and conclusions.
9. Colleagues may wish to take particular note of the following points:
i. The developments proposed for the London area provide capacity for about 72 million passengers by 1990 compared with the forecast range of 66-90 million passengers. There is, therefore, a risk that demand will exceed planned capacity at the end of the 1980s if traffic grows at the highest forecast rate. However, given the considerable uncertainties, set out in the White Paper, surrounding the high forecast; the importance attached to flexibility in airports policy; the need to avoid possibly premature expenditure on further airport capacity; and the probability that the developments proposed could almost certainly cater for a greater number of passengers if the need arose, I think this is a risk which we should accept.
ii. Outside the London area the policy is one of rationalisation. The White Paper states clearly that, with the exception of the Highlands and Islands, further subsidies for airports will not be provided and that wasteful competition will not be encouraged. Certain airports are identified as centres for growth.
iii. The White Paper makes it clear that the Government will seek to encourage the more rapid development of air services in the regions by their concentration at selected airports, but because the overwhelming proportion of passengers live in the South East the White Paper rejects suggestions that measures should be introduced to force these passengers to use airports in the regions.
iv. Although there could be advantages in encouraging the takeover by the British Airports Authority of the strategic regional airports identified in the White Paper, I believe that in the interest of preserving local and regional autonomy, any transfer of airports should be based on agreement between the British Airports Authority and the local authorities concerned rather than on the direction of central Government. v. Further decisions on airport development are likely to be necessary, especially in the South East, where additional airport capacity will be needed for the 1990s if air traffic continues to grow. The White Paper indicates that the Government intends to continue to consult widely on these issues and, in particular, to involve the local planning authorities more closely in the preparation of policy.
5. The proposals in the White Paper minimise expenditure as far as practical and for the current Public Expenditure Survey period are expected to be contained within existing provision.
6. Publication of the White Paper has been widely anticipated for some time and before the Recess the House was informed that publication was expected early in 1978. A clear statement of policy is needed to remove present uncertainties affecting many organisations and people, but more importantly to provide the necessary impetus to the transfer of traffic from Heathrow to Gatwick and to the Public Inquiry on the proposed fourth terminal at Heathrow, both of which are essential to the handling of London area air traffic in the shorter term. Cabinet is invited to approve the White Paper for publication.
ED
Department of Trade
17 January 1978 INTRODUCTION
1 Background 2 Consultations on airports policy 3 Basic assumptions of airports policy
SECTION 1: THE FRAMEWORK FOR AN AIRPORT STRATEGY
1 Introduction 2 Types of airport Gateway international airports Regional airports Local airports General aviation aerodromes 3 The implementation of an airports policy 4 The role of regional diversion 5 Airport capacity limitations 6 Finance and ownership 7 Airport charges 8 Future development of policy 9 The framework
SECTION 2: AIR TRAFFIC FORECASTS
1 Introduction 2 A review of the forecasts 3 Realism of forecasts 4 Cargo forecasts SECTION 3: THE AIRPORT ENVIRONMENT
1 Introduction 2 Aircraft noise 3 Access 4 Planning
SECTION 4: A NATIONAL AIRPORTS SYSTEM
1 Introduction 2 The London area airports Heathrow Gatwick Stansted Luton Adequacy of proposed developments The longer term Costs 3 Airports outside the South East Central England Northern England South Wales and South West England Scotland Central Scotland Northern Scotland 4 General aviation
SUMMARY AND CONCLUSIONS
1 Development of a national airports system 2 The demand for air transport 3 The London area 4 The rest of Great Britain 5 Scotland 6 General aviation 7 Implementation of the strategy 8 Access 9 Aircraft noise 10 Planning 11 Consultation The need to meet the demand for air travel in the London area by building a large new airport on the Maplin sands, in the Thames estuary, 50 miles from London was called into question by four developments in the early 1970s. First, the rapid introduction of large aircraft meant that the major constraints at airports in the London area had become the capacity of passenger terminals rather than runways. Secondly, the new larger aircraft were markedly less noisy than their predecessors, and international agreement on the permitted noise levels of all new jet aircraft suggested that disturbance from aircraft noise would be reduced over the coming years. Thirdly, the exceptional rise in the cost of fuel, involving for the airlines a 250 per cent increase between 1972 and 1974, resulted in traffic forecasts significantly below those experienced in the past or considered to be reasonable by the Roskill Commission. Finally, the economic recession of 1974 necessitated a drastic pruning of public expenditure.
Against this background, the Government re-assessed the Maplin airport project, which was abandoned. It also decided to undertake a comprehensive review of airports policy in Great Britain in consultation with all those concerned. This review was not concerned with Northern Ireland since the development of Belfast Airport does not impinge upon the provision of airport capacity in Great Britain. Neither was it concerned with the Channel Islands or the Isle of Man.
CONSULTATIONS ON AIRPORTS POLICY
3 The Roskill Commission produced one of the most thorough examinations ever undertaken of the options for a major project of public investment. Yet the conclusions of the Commission, in a changing economic climate, were shown within a few years to be based on assumptions of rates of growth of air traffic which were unlikely to be achieved, while the pace of technological development and its effects had been more rapid than expected. Moreover, the recommendation of the Commission, for a new airport on an inland site at Cublington, was itself rejected by the Government. This experience suggested a certain caution, and the need to recognise the wider implications, in the case of projects involving the commitment of vast public resources and affecting many millions of people.
4 The Government decided that, for the future, it was essential to ensure that decisions concerning the development of particular airports were reached after taking full account of the views of all those who use, work at, or are affected by, them. To facilitate this process, and to ensure a wider understanding of the issues the Government produced a two part consultation document "Airport Strategy for Great Britain". Part 1, published in November 1975, covered the London area airports and Part 2 published in June 1976 dealt with the regional Nearly 1000 organisations throughout Great Britain were invited to comment on these documents, including all the local authorities concerned, Regional Economic Planning Councils, amenity groups, airlines, airport authorities and employees and other organisations with an interest in airport developments. In addition, a considerable number of other organisations and individuals submitted comments and advice. The Government believes that this approach to the development of airports policy has been both necessary and useful. The advice which has been received has been virtually unanimous in welcoming the consultation process and endorsing the need to consider airports policy in a national context.
Understandably, a great deal of the advice submitted represented the views of special interests such as the users of an airport or those adversely affected by its operations. The Government's conclusions will not therefore receive universal acceptance. Nevertheless, it is hoped that as a result of the consultations there will be at least a better understanding of the decisions which the Government believes to be necessary. Certainly within Government there is a clearer and deeper understanding of the position of all those with an interest in airport developments.
In developing its policy the Government has been influenced by six main considerations: confirmation of the abandonment of the Maplin airport project; the role of the air transport industry in the national economy; the environmental and land use implications of airport developments; consumer demand; the more effective use of existing airport, road and other infrastructure resources; and flexibility in planning and development which can be related more closely to the growth in demand. The Government has also considered the employment and the industrial development promoted by airports.
8 Until the 1960s, the rapid growth of the air transport industry throughout the world had been little constrained by environmental considerations. Many airports had been built and developed on sites which, had the post war development of civil aviation been foreseen, would not have been acceptable. While the massive investment which has been undertaken cannot be ignored, an increasingly important element of any airports policy must be a recognition of the need to take account of the planning and environmental effects of airport development and specifically the need to limit as far as possible the impact of aircraft noise on areas surrounding airports.
9 However, there needs also to be a proper recognition of the contribution which the air transport industry makes to the United Kingdom economy. Civil aviation is the dominant form of international passenger transport and plays a role both in domestic transport and in international trade. During the period which has seen the decline of traditional industries, air transport has been a high growth industry, and is an area in which the United Kingdom has retained a strong position in the international market. Air transport not only provides a substantial benefit to the economy, but is an essential part of the industrial structure of a country that needs to live by its trade with the outside world. It is also offering increasingly wide opportunities for all sections of the community both to enjoy holidays abroad and to visit friends and relatives living outside the United Kingdom. A small number of those consulted expressed the view that the dis-benefits of aviation, in particular aircraft noise and associated congestion on the ground, were too high a price to pay. However, the majority accepted that, while there must be a proper consideration of the effects of airports on the surrounding areas, ways should be sought for meeting efficiently the growing consumer demand for air transport.
Finally, in the present economic climate an important priority of any policy should be to establish the most effective use of existing airports infrastructure and related investment. Furthermore, under conditions of uncertainty, rigid plans would be inappropriate and there is a need therefore for a strategy which will seek to balance conflicting interests, and at the same time allow for change and adaptation as circumstances unfold. SECTION 1: THE FRAMEWORK FOR AN AIRPORT STRATEGY
INTRODUCTION
11 Air traffic demand has remained overwhelmingly concentrated at the four London area airports of Heathrow, Gatwick, Luton and Stansted which account for about two thirds of all terminal passengers(1) using airports in Great Britain. Heathrow alone handles about half the total terminal passengers and over 60 per cent of the international passengers at airports in Great Britain. While paragraph 46 suggests that there might be grounds for expecting a growth in demand for air travel in areas outside the South East in the period up to 1990 and beyond, a significant increase in capacity will be required at the London area airports.
12 Outside the South East, the problem has been an over provision of airport capacity and an inability to generate traffic. If there is to be an efficient use of the country's resources and encouragement given to the development of viable air services in the regions, a reassessment and rationalisation of the future roles of the regional airports is required. These general requirements of the London and regional airports have been widely recognised by those consulted.
TYPES OF AIRPORT
13 In establishing a framework for an airport strategy the first step is to determine the types of airport required in the various parts of the country in relation to the expected demands.
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(1) Terminal passengers are those passengers who join or leave a flight at an airport; they include all passengers except transit passengers. The 1961 White Paper: Civil Aerodromes and Air Navigational Services (Cmnd 1457) suggested that the principal "gateway" airports should be regarded as part of a national airport system. Part 2 of the consultation document "Airport Strategy for Great Britain" proposed that this concept might merit further development and considered the grouping of airports within a number of categories. Comments received during the consultations indicated some disagreement about the role of particular airports, but there was considerable support for a grouping of airports by category as the basis for a national airports strategy, embracing both the London area and the regions.
14 The grouping of airports will not of itself provide the rationalisation of airport facilities which the Government believes to be necessary, particularly outside the South East of England. This will require the implementation of policies on a range of air transport and related matters and on the decisions and involvement of local authorities, local communities and other organisations. However, with a clear lead from the Government on the role of particular airports, the organisations concerned should be able to relate their individual decisions to an overall strategy.
15 It is not the Government's intention to establish a rigid plan for airport development, since this would fail to recognise the reality of a changing situation. Furthermore, the definitions of the various categories will need to be interpreted flexibly since they will not necessarily be precisely relevant to all airports over a period during which the role of individual airports might change. It is essential therefore that the basic framework should be capable of adaptation to meet changing circumstances and that any modification should be the subject of consideration with those concerned.
16 In the light of comments received during the consultations the Government has adopted the following categories of airport as part of the framework for airports policy.
A Gateway International Airports These airports would provide or be expected to support over time, a wide range and frequency of international services, including inter-Continental services and a full range of domestic services.
B Regional Airports These airports would cater for the principal air traffic demands of individual regions, parts of regions or groups of regions outside the South East. They would be concerned essentially with the provision of a network of shorthaul scheduled international services; a significant range of charter services; and domestic services including links with gateway airports. The scheduled international services would be primarily on the more popular routes to Europe or related to the special associations which exist between some countries and parts of Great Britain, for example, between Scandinavia and North East England and Scotland.
C Local Airports These airports would provide third level services(^{(1)}) catering primarily for local needs, concentrating on general aviation(^{(2)}) with some domestic feeder services and some charter flights.
D General Aviation Aerodromes These would be concerned primarily with the provision of general aviation facilities.
THE IMPLEMENTATION OF AN AIRPORTS POLICY
17 It is not the Government's intention to dictate to airlines and airport authorities the precise conditions under which they should operate, but to give the maximum scope for commercial decision. However, it is its objective to ensure, as far as possible, that the decisions and policies of the aviation authorities and local authorities are consistent with the national airports strategy. The framework in this White Paper and the developments envisaged over the period to 1990, should provide a guide to those policies and decisions.
18 The implementation of airports policy will require the co-operation of many authorities and a positive role for the Government. First, the Government will take account of airports
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(1) Third level services are usually defined as those scheduled passenger services operated by aircraft with fewer than 25 seats.
(2) General aviation encompasses all forms of civil aviation other than the operations of major airlines and includes business and recreational flying and flying training. policy in issuing permits for scheduled and charter services by overseas operators. Secondly, the Civil Aviation Authority (CAA) in considering applications by British operators for new air services and for renewals of existing licences will be expected to take account of airports policy in accordance with paragraph 14 of the guidance contained in the White Paper: Future Civil Aviation Policy of February 1976 (Cmnd 6400).
Thirdly, the Government's policy of encouraging the growth of air services at regional airports outlined in paragraph 22, will be related to the overall objectives of airports policy.
Fourthly, at publicly owned airports the authorities concerned will be expected to relate the development of their airports to the Government's airports policy as well as to the criteria which may from time to time apply to public sector projects. Fifthly, in so far as planning procedures may be relevant, the local authorities concerned will be expected to have regard to airports policy in their consideration of proposals for development at and around airports. Finally, the Government's policies relating to employment and to the provision of roads, housing and other forms of infrastructure will have regard to airports policy.
THE ROLE OF REGIONAL DIVERSION
19 The transfer of some part of the growth in air traffic, which might otherwise take place in the South East, to other regions would have two main benefits. First, it would help to relieve pressure on resources in the South East and secondly, it would contribute to the Government's regional development policies.
20 Comments during the consultations on the diversion of traffic to regional airports indicated a widespread, but not universal, rejection of any policy to require passengers with origins and destinations in the South East to use airports outside the region. Many of the amenity groups and local authorities in the South East felt that the same consideration should be given to the environmental costs as to the costs to the air transport industry and to passengers of diverting traffic to regional airports. In addition, many provincial organisations, while accepting that a large scale diversion of London area passengers was unrealistic, considered that greater attention should be given to attracting back to regional airports passengers currently using London's airports because of the lack of suitable services from regional airports. It was also suggested that the propensity to fly(^{(1)}) in the regions other than the South East, which is about two-fifths of that in the South East, would increase relatively in the future; that there was scope for attracting increasing numbers of foreign tourists direct to these regions; and that provided the airlines were given sufficient encouragement, these additional demands could lead to a greater contribution from the regional airports to the handling of total air traffic demand in Great Britain.
21 The Government, which has consistently emphasised the importance it attaches to the greater use of regional airports, has given particular consideration to the representations which have been made. In an area where facts and forecasts are more
(^{(1)}) Propensity to fly is the number of international flights by UK residents in a particular year with origins and destinations in a particular region per head of population in that region. than usually uncertain, the Government considers that particular caution is necessary in predicting over a fifteen year period the reactions of individuals to various economic stimuli and economic and social trends. Bearing in mind that at the present time 80 per cent of terminating passengers at London airports have origins and destinations in the South East, any forced diversion of traffic, to have a significant effect on air traffic demand in the South East, could involve the imposition of substantial charges on passengers using London airports. The Government rejects the suggestion that the air transport industry should be subject to the damaging restrictions on its operations, which would be the outcome of the forced diversion of traffic to regional airports.
Nevertheless, the Government believes that there are a number of ways in which a greater role for airports outside the London area can be achieved. First, the Government considers that the pursuit of a coherent airports policy should make a positive contribution to an overall increase in traffic from the regions outside the South East. A proportion of those passengers presently using the London airports, but with origins and destinations outside the South East would be prepared to use airports elsewhere if the right services, at the right time, and with the right frequency were available. Such services are more likely to be commercially viable if they are operated from a limited range of airports. The avoidance of wasteful competition between regional airports, if this can be assured, should provide some incentive to airlines to mount services from the more important regional airports. Secondly, it should be possible to achieve a greater use of regional airports by chart and leisure traffic. Leisure trips, and particularly inclusive tours by United Kingdom residents, already show a more even distribution of origins and destinations than other services and there could be scope for greater market development outside the South East. Tour operators should become increasingly aware of the advantages of providing services from the regional airports, and perhaps also for the most popular destinations from local airports. Thirdly, incoming leisure traffic, although a high proportion continues to travel by sea, is likely to be the fastest growing sector of air travel. The great majority of foreign visitors come to London, but nearly half their time is spent in other parts of the country and the British Tourist Authority and other tourist boards are already following policies designed to spread tourism more widely. Furthermore, the choice of London as the main base for foreign leisure visitors may decline as the number of visitors rises, congestion in the London area increases, and the relative price advantage of other parts of the country becomes more attractive.
The London area airports handle an even higher percentage of the country's international air cargo than of international passengers, although the proportion of cargo with origins or destinations in the South East is lower than for passenger traffic. However, the fact that over half the cargo at Heathrow is carried on passenger flights, together with the attractiveness of the greater frequencies and range of destinations at the London airports, the significant economies of scale available by concentrating traffic at a small number of airports, and the practice of moving cargo by road from regional airports to London airports, limits seriously the scope for diverting cargo to regional airports.
24 It has been suggested that an all cargo airport should be established outside the South East, but this suffers from the same fundamental difficulty of the close links between cargo and passenger traffic. The Government does not consider that an all cargo airport is a practicable proposition at this time. The attraction back to regional airports of cargo traffic at present travelling through the London area airports, must depend primarily on the growth of international passenger services from regional airports. In view of the economies of scale in cargo handling facilities and the need for frequent services and a wide range of destinations, there is a clear need for air cargo activities outside London to be concentrated at a small number of airports. It will be the Government's policy therefore to encourage the provision of adequate freight facilities at those airports identified as having a significant role in the national airports strategy.
25 Paragraph 18 emphasised the need for co-operation among all those concerned if a national airports policy is to be effective. This will be particularly important in enhancing the role of regional airports and the Government will seek to co-ordinate this co-operation. In the case of the regional airports it will be the Government's objective to promote the changes outlined in paragraphs 22 and 24, but results will take some time. A switch in traffic from the South East to other areas of Great Britain is likely to develop over the period to 1990, but it will not avoid the need for additional airport capacity in the London area. AIRPORT CAPACITY LIMITATIONS
26 Within the consultation process many local authorities drew attention to the need to avoid in the future the "creeping expansion" of airports which they have contended has been a characteristic of the past and to establish "ceilings" on the growth of particular airports. This would provide the local authorities with a firm basis for their urban development, infrastructure planning and related policies, and at the same time contain the environmental impact of airport development and air transport operations. There were suggestions that these "ceilings" should be defined by reference to passenger and cargo throughputs, air transport movements(1), numbers employed at the airport, or levels of aircraft noise.
27 The Government recognises these arguments. However, with the growth of air traffic, the future level of noise disturbance and many other factors inevitably uncertain and with the current economic situation imposing tight constraints on public expenditure, airport capacity must be provided only in so far as demand can be foreseen with reasonable confidence. The imposition of rigid quantitative limitations on the capacity of airports would not be compatible with that approach, neither would it be practical nor necessarily useful to those affected by airport development. If limitations below the capacity of airports were established in terms of the number of passengers or aircraft handled in a year, it is not easy to visualise how operations could be sustained and the credibility of the ceilings maintained, when the prescribed limits had been reached.
(1) An air transport movement is a landing or a take off by an aircraft operating a scheduled or non-scheduled service. The rates of technological development and design changes in airports in recent years have demonstrated the difficulties in attempting to predict the anticipated capacity of separate elements of an airport's infrastructure.
While this suggests the need for a step by step approach to airport development, the Government is anxious to respond to the arguments which have been advanced and to provide some reassurance of the kind local authorities are seeking on the ultimate capacity of airports. The Government therefore accepts that limits on the development of airports must be an important part of its strategy throughout Great Britain. The Government believes that this can best be achieved by a combination of restrictions on the number of terminals that can be provided at an airport; through arrangements for the monitoring and development of future airports policy, which will involve the local authorities; and through the modification of the British Airports Authority (BAA) General Development Order (GDO) planning provisions, particularly as they relate to terminal developments. The strategy presented in this White Paper incorporates each of these elements.
FINANCE AND OWNERSHIP
Policy on the provision of Government financial support for airport development, as well as ownership, was laid down in the 1961 White Paper. This envisaged that the air transport industry should become self-sufficient in the longer term. The White Paper recognised that a number of small aerodromes, notably in the Highlands and Islands of Scotland, were essential to the economy and social welfare of the areas they served, that they were never likely to pay their way and that they might need to be supported by means of a direct subsidy. The White Paper also recognised that some financial assistance from the Exchequer might be justified for a period, where an airport served a national as well as a local need, and where the cost of running the airport would place an unduly heavy burden on local resources. The Government does not consider that there is any justification for air transport facilities in general to be subsidised by the taxpayer and the ratepayer. Consequently, while it accepts the need, on social grounds, to secure the continued operation of a limited number of small aerodromes, particularly in the Highlands and Islands, which provide an essential service to the local community but which are not likely to become viable in the foreseeable future, the Government considers that the air transport industry has now advanced to the stage at which new commitments to financial assistance from the Exchequer for airport development, or for the acquisition of airports, will only be justified in wholly exceptional circumstances.
30 The 1961 White Paper concluded that the Gateway airports should be owned and managed by a separate airports authority, and the British Airports Authority was subsequently set up to own and operate the principal international airports at Heathrow, Gatwick, Stansted and Prestwick. Part 2 of the consultation document suggested that in the light of both the 1961 White Paper and the possible future development of the airports system, the role of the BAA might be expanded by the Authority's acquisition of the principal airports which at present it does not own and operate. A number of advantages of such a policy were put forward. First, that the longer term development of gateway international airports would require the sort of airport management, technical and operational expertise which, in the case of local authority owned airports, may impose demands on financial and other resources beyond the compass of the present owners. Secondly, that consistent financial, management and investment policies for major international airports would be an important part of a national airport strategy and common ownership might facilitate this. Thirdly, the concentration of activity at a number of airports might be given encouragement by ownership by the British Airports Authority.
31 In the course of the consultations, those authorities concerned with airports which seemed likely to be candidates for acquisition by the British Airports Authority were for the most part opposed to or had reservations about losing control of their airports. While recognising the need for a national policy towards airports they emphasised the widespread opposition to over-centralisation and drew attention to the acceptance in the consultation documents that the local authority owned airports have been efficiently operated. It was also pointed out that there was advantage in local responsibility and control and responsiveness to local needs. Finally, it was argued that consistency of airport authority policies would derive from the formulation of a national policy and did not depend on ownership by the British Airports Authority.
32 In the light of the views expressed during the consultations, the Government has concluded that a coherent airports policy derived from the framework provided by this White Paper, is not dependent on major changes in ownership. Local authorities will, of course, need to take into account the implications of the Government policy set out in paragraph 29. In circumstances where there is agreement on the desirability of BAA ownership between the local authority owners concerned and the BAA and where this would be consistent with the Government's strategy, the Government will consider proposals made for changes in ownership. In such cases the Government will attach particular importance to ensuring an effective local voice in the operation of any airports which the BAA might acquire.
33 Losses at local authority airports in England and Wales are currently running at £5-6 million a year. While the subsidies for some Highlands and Islands services are a particular exception the Government sees no general justification for subsidising airports and air services. At the airports which will remain under local authority control the Government will continue to urge economies and the application of policies aimed at reducing financial losses as effectively as possible. In particular, as a general rule the Government will expect proposals for improving these airports to be postponed until the economic situation allows some growth in local authority expenditure.
AIRPORT CHARGES
34 Part 2 of the consultation document suggested that one factor contributing to losses at regional airports had been the adoption of uneconomic charging policies. It had been argued that the major airports in Great Britain were part of a common system to which common airport charges should be applied. During the consultations a number of airport authorities expressed their opposition to increased charges for air navigation services by the Civil Aviation Authority, which, they pointed out, were very much higher at regional airports than at airports in the London area and thus were reinforcing the existing pattern whereby landing and other charges at the BAA's London airports are generally lower than those elsewhere. The regional airport authorities contended that differential increases of this kind were not consistent with the Government's wish to encourage the growth of traffic at regional airports.
The Government's consideration of these matters has been influenced by three principles. First, the Government does not consider that air travel generally should be subsidised by the taxpayer and ratepayer and believes that charges should reflect the cost of providing airport services. Secondly, airport revenues should be adequate to provide for the continued existence, including replacement and a return on capital, of the facilities. Thirdly, and within these principles and the constraints of anti-inflation and competition policy, the setting of airport charges should remain a matter for airport managements. In consequence, the Government considers that the substantial deficits which have been incurred at some airports are consistent with the principle that air travel should not be subsidised by the non-travelling public. It rejects any suggestion that exchequer subsidies should be available generally to support the operation of airports.
It is recognised that since airports have a high level of fixed capital, average unit costs are very dependent on traffic levels and this can give large established airports a considerable advantage. Moreover, it may often be difficult to define the marginal costs of providing airport services, particularly where these are supplied centrally or where there are large overhead costs. However, the Government is not convinced that airport landing and related charges are a material influence on the level of traffic at an airport. They represent a very small proportion of total aviation costs and the extent to which airlines have a choice of airport is frequently over-estimated. Thus, while differential airport charges may be of some significance in the competition between airports serving a similar catchment area and in influencing the spread of traffic between peak and off-peak periods, the effect on the attractiveness of the regional airports in general is negligible.
37 The Government is conscious of the difficulties caused by the recent large increases in charges. It recognises also the criticisms of the diversity of charges with airport landing fees, which are often themselves complex, being supplemented by charges for air navigation services, security and aerodrome licensing. It has been suggested that this multiplicity of charges should be replaced by a simplified charging system. The Government understands the force of this argument but it believes also it is important that the justification for particular charges should be understood and that they should be kept generally in line with costs. Charging systems should be a matter primarily for airport managements, and the other providers of services. However, the Government will keep aviation charges under review to ensure, amongst other things, that the policies adopted are generally consistent with the Government's overall airports strategy.
FUTURE DEVELOPMENT OF POLICY
38 The consultations revealed considerable anxiety about possible longer term airport developments if the growth of demand, particularly in the London area, does not sooner or later begin to level off. Concern on this question is understandable, but the problem flows from uncertainties which are inherent in forecasting air traffic demands and translating these into acceptable airport developments. In these circumstances the Government acknowledges that a necessary part of any airports strategy will be to maintain close liaison with local authorities and others concerning the future of particular airports. Moreover, the roles envisaged for different airports may change over time and in the London area, in particular, it will be necessary to consider the provision of additional capacity either at existing airports or at a new airport in the not too distant future.
39 It will be the Government's intention to continue to consult those concerned with the development of airports policy in the longer term. In this connection a number of local planning authorities, mainly through the Standing Conference on London and South East Regional Planning, have represented that they should be more closely associated with the identification of future airport development options that may figure in future consultations. The Government recognises the particular interest of the local planning authorities and intends, therefore, to discuss with the local authority associations an appropriate formal structure that will allow these interests to be taken into account in the formulation of advice on the longer term options for airport policy. THE FRAMEWORK
40 The recent Transport Policy White Paper (Cmnd 6836) announced the setting in hand of a study of the longer term demand for domestic inter-urban public passenger transport by rail, bus and air, with a view to improving co-ordination of operators' pricing policies and investment plans. Investment in airport capacity is primarily needed in response to growth in international air traffic, and to this extent the study will have only limited relevance to the issues dealt with in this White Paper. However, the study will provide a useful contribution to the development of forecasts of domestic air traffic over the next 10 - 20 years. The planning of airport facilities to meet air transport demands must proceed in concert with developments in domestic surface transport and the Government will ensure that the Departments involved continue to work closely together in this area of planning.
THE FRAMEWORK
41 Within the need to determine how the demand for air transport in South East England can be accommodated and how airport facilities in other areas of Great Britain can be used more extensively, the airports strategy framework, involving the division of airports into four broad categories, will be based on six guidelines.
(i) The rationalisation and concentration of the principal air services at a limited number of airports outside the South East.
(ii) Acknowledgment of the need for flexibility in policy rather than the adoption of a rigid plan for all airports. (iii) The development of policies on air service licences and permits, on the expansion of airports, and on planning and related matters consistent with airports policy.
(iv) Recognition that the diversion of traffic to regional airports is unlikely to have any significant effect on the demand for airport capacity in the South East.
(v) Acceptance of the need to identify the limits of an airport's development.
(vi) Acknowledgment of the need to develop further the process of consultation on airports strategy.
Basic to the application of these guidelines will be the principle that air transport facilities should not in general be subsidised by the taxpayer or ratepayer. SECTION 2: AIR TRAFFIC FORECASTS
INTRODUCTION
42 In assessing the demand for airport capacity, and in determining the airport developments which might be required, might be provided and might be acceptable, it is necessary to quantify the level of demand. Because of the lead times involved in the provision of major additions to airport capacity, it is essential to provide forecasts of passenger and cargo demand covering the period 10 to 15 years ahead. Forecasting over so long a time scale, whether of air transport or of any other area of economic activity, involves considerable uncertainties and the basic forecasts are no better than the assumptions on which they are based and the methodology adopted. The methodology used for the forecasts in the consultation documents produced results which were not significantly challenged during the consultation process. Nevertheless, it is important, and it will be the Government's intention to monitor the present forecasts in line with the development of traffic, to keep the assumptions and methodology under review, and to prepare forecasts for the late 1990s and beyond. The passenger traffic forecasts prepared for the Maplin Review and the consultation documents were based on the traffic levels of 1972 and covered the period to 1990. Actual traffic levels since 1972 reached a peak in 1973 followed by a recession in 1974, which interrupted a continuous pattern of growth since 1945. Traffic began to recover in 1975 and by 1976 had exceeded 1973 levels. The traffic levels during these years are shown in Table 1.
Table 1: Terminal Passengers at Airports in Great Britain 1972-76
| | 1972 | 1973 | 1974 | 1975 | 1976 | |----------------------|------|------|------|------|------| | Heathrow | 18.3 | 20.3 | 20.1 | 21.3 | 23.2 | | Gatwick | 5.3 | 5.7 | 5.1 | 5.4 | 5.7 | | Stansted | 0.3 | 0.2 | 0.2 | 0.2 | 0.3 | | Luton | 3.1 | 3.2 | 2.0 | 1.9 | 1.8 | | Total London Airports| 27.0 | 29.4 | 27.4 | 28.8 | 31.0 | | Other airports in | | | | | | | England and Wales | 7.3 | 8.3 | 7.4 | 7.7 | 7.8 | | Scottish airports | 3.6 | 4.1 | 4.0 | 4.2 | 4.8 | | Total Great Britain | 37.9 | 41.8 | 38.8 | 40.7 | 43.6 | A REVIEW OF THE FORECASTS
Since the preparation of the forecasts for the consultation documents, a review of the assumptions and the methodology has been carried out. This has involved a reconsideration and re-estimation of all the main assumptions used in building up the national forecasts and an attempt to establish a more comprehensive explanation of past growth. Taking this work into account, revised forecasts for Great Britain have been prepared and these are shown in Table 2. The base year has been updated from 1972 to 1975 and forecasts have been produced for five year intervals up to 1990. The position beyond 1990 has also been considered. Growth in traffic is expected to continue, but the prospects for the 1990s and beyond are a matter of particular uncertainty especially in view of the developments discussed in paragraphs 47-49.
TABLE 2: Air Passenger Demand in Great Britain
| | 1975 | 1976 | 1980 | 1985 | 1990 | |----------------|------|------|------|------|------| | | Low | High | Low | High | Low | High | | London Area | | | | | | | | International | 24.9 | 26.8 | 32.4 | 37.1 | 46.3 | 57.1 | | Domestic | 3.9 | 4.2 | 4.3 | 4.8 | 5.1 | 6.4 | | Regional Airports | | | | | | | | International | 5.3 | 5.6 | 6.2 | 7.3 | 8.8 | 11.6 | | Domestic | 6.6 | 7.0 | 7.0 | 7.9 | 7.9 | 9.7 | | Total Great Britain | | | | | | | | International | 30.2 | 32.4 | 38.6 | 44.4 | 55.1 | 68.7 | | Domestic | 10.5 | 11.2 | 11.3 | 12.7 | 13.0 | 16.1 | | Total | 40.7 | 43.6 | 49.9 | 57.1 | 68.1 | 84.8 | The main changes resulting from the review of the earlier forecasts are a somewhat lower overall expectation of growth in the period up to 1990 and a narrowing of the range between the low and high forecasts. The most significant reduction occurs in the high end of the forecast range. These changes result partly from revisions in the assumptions for economic growth and fuel prices and partly from the reassessment of the price and income elasticities. A more critical review of the compatibility of the various assumptions has also been carried out, the results of which have led to a narrowing in the range of forecasts.
Within the air traffic forecasts, the proportion of passengers expected to use the London area airports is of particular significance, since it is there that the main capacity problems are expected to arise. Table 3 analyses both the traffic in 1975 and the forecasts for the London area in terms of the nationality of the passengers and the purpose of their journeys. The forecasts for international traffic have been arrived at by assuming for the London airports as a whole a constant share of the total Great Britain traffic in each passenger category. The forecasts and particularly the domestic forecasts, take account of competition from surface travel. The assumption of a constant share in each category of international traffic, although it leads to small fluctuations in the total London share of international traffic because of the different rates of growth in the various categories, implies a fairly stable 80 per cent share for the London airports up to 1990. Overall, with the addition of domestic traffic the London area airports share of total traffic could rise slightly over time on these assumptions. The realism of a constant share assumption for international traffic is open to question. The London area proportion might fall over time, as the attraction of the other regions to foreign tourists and businessmen, the propensity to fly in the other regions, and the availability of services at regional airports, increase. However, there is as yet no evidence of any clear trend in this respect and, while the Government accepts that this proportion could change, it is prudent for forecasting purposes to retain the assumption that the proportion of international passengers using the London airports will remain stable.
Table 3: Forecast International & Domestic Passenger Demand at London Area Airports
| Period | International | Domestic | Total | |--------|---------------|----------|-------| | | UK | Foreign | | | | Inclusive Tours | Other Leisure | Business | Leisure | Business | | | 1975 | 4.5 | 4.7 | 2.5 | 10.2 | 3.0 | 3.9 | 18.8 | | 1980 Low | 4.8 | 5.8 | 3.5 | 14.1 | 4.2 | 4.3 | 36.7 | | High | 6.5 | 6.2 | 4.0 | 15.5 | 4.9 | 4.8 | 41.9 | | 1985 Low | 6.9 | 7.9 | 5.0 | 20.7 | 5.8 | 5.1 | 51.1 | | High | 11.3 | 8.4 | 6.5 | 22.9 | 8.0 | 6.4 | 63.5 | | 1990 Low | 8.2 | 9.9 | 6.9 | 27.1 | 7.9 | 5.9 | 65.9 | | High | 15.1 | 11.0 | 10.1 | 32.0 | 12.7 | 8.5 | 89.4 | REALISM OF FORECASTS
47 The inherent uncertainty of any attempt at forecasting has already been acknowledged, but there are two particular areas where some degree of judgement has been exercised and a third to which particular reference should be made. First, the forecasts will be affected if certain air travel markets begin to show signs of 'saturation'. While there is little indication that this point has been reached, there has been considerable debate within the air transport industry on the extent to which the upper limit of market growth can be identified. The rapid rates of growth, such as were seen for Inclusive Tours in the 1960s, represented the successful development of a new market, but the size of this market for leisure travel is limited not only by economic factors, but also by other constraints such as available time and family structure. For these reasons rapid growth in the leisure market cannot be expected to continue indefinitely. This effect has been incorporated into the forecasting model by assuming a decline over time in the sensitivity of demand to price and income changes. As a result, a tailing off in the growth in demand appears in the forecasts, but it has not been possible to identify any clear upper limit. Nevertheless, by the 1990s the effects of saturation may well be significant, particularly at the high end of the forecast range and especially in the South East where market penetration has proceeded further than in other areas of the country.
48 Secondly, there is the question of whether the very large component of foreign leisure passengers forecast in the 1980s will be attracted to and can be accommodated within the London area. Foreign leisure passengers represent a significant proportion of the forecast total international demand at the London area airports in 1990, or around 32 million passenger movements with the high forecast. This would imply that about 16 million leisure passengers will be arriving at and departing from the London area airports in 1990, compared with 5 million at present, and it is likely that a high proportion of them will spend at least some of their time visiting London. The Government is considering the implications which such possibilities could have for tourism policy, but it is already evident that such a demand could not be accommodated in London without a substantial expansion of the existing stock of hotel and other accommodation over the next 15 years. It is unlikely that such expansion would occur without a real increase in the level of hotel tariffs, which would in turn lead to some reduction in tourist demand, and it may be doubted whether there will be the space available in Central London to meet the higher end of the forecast demand. It is also probable that the congestion at the main tourist attractions will lead to some reduction in demand. It is not possible to forecast the precise impact of these effects on air traffic demand, but a reduction in the incoming leisure component for the London area of 10-15 per cent by 1990 might not be unrealistic. This could reduce the high 1990 forecast by up to 5 million passengers.
Thirdly, the possibility must be recognised that there will be an upward trend in oil prices over the next 15 years. Estimates of the timing vary, with some experts predicting significant further movement from the early 1980s. The traffic forecasts assume up to a 50 per cent increase in fuel prices in real terms by 1990. If fuel prices were to exceed this level there would be some further reduction in demand for air travel.
CARGO FORECASTS
Although the volume of United Kingdom trade carried by air is small, amounting to less than 1 per cent of the total, the value is high. Over the past 15 years the value of United Kingdom trade by air has increased from £526 million, representing 6 per cent of the total to £3,564 million in 1976 or 15 per cent of total United Kingdom trade. Growth in air cargo was badly affected by the cut back in trade following the fuel crisis, but there was no fall in air cargo's share of the total value of United Kingdom trade. Over the period to 1990 it is expected that there will be further growth in air cargo and that it will continue to account for a growing part of the value of our trade.
Air cargo is transported both on all-cargo services and in the holds of passenger-carrying aircraft. The development and introduction of wide-bodied jets has increased the space available for cargo on passenger services and has limited the growth of all-cargo services. In recent years all-cargo movements have accounted for a fairly stable 8-9 per cent of the total air transport movements in the London area. In the future, although the tonnage could increase by as much as 6-10 per cent a year, there is not expected to be any major change in the proportion of freight carried on all-cargo movements. SECTION 3: THE AIRPORT ENVIRONMENT
INTRODUCTION
52 The Airport Strategy consultation document emphasised the importance which the Government attaches to the environmental implications of airport developments. Substantial sections of both parts of the document were devoted to the way in which different developments might affect the communities surrounding the airports and many of the comments were concerned with environmental matters.
53 During the consultations some organisations argued that environmental factors should dictate airports strategy, that the Government should decline to meet the demand for airport facilities, or that airports should be sited at a considerable distance from centres of population. Such approaches leave out of account the benefits to be derived from an efficient air transport system and fail to meet the reasonable needs of industry. Furthermore, what are sometimes described as "environmental airports" away from centres of population are by no means universally acceptable as experience in this country and elsewhere has shown. 54. Notwithstanding the predicted reductions in aircraft noise disturbance which were explained in the consultation document, aircraft noise emerged as a matter of widespread concern. The Government recognises the genuine anxieties which exist and, although it remains confident that the introduction of new and quieter aircraft will bring increasingly dramatic improvements in the situation, it will continue to maintain and develop a range of ameliorative measures as an essential component of its airports strategy. In the Government's view the maximum value from direct measures, such as those governing aircraft noise abatement procedures and the noise certification of aircraft, can only be realised if they are supported by firm and widely understood policies covering, among other things, the identification of those airports where the main growth in traffic is to be concentrated; the definition of aircraft flight paths; and the control, under the Town & Country Planning Acts, of residential and other noise sensitive developments in areas subject to aircraft noise.
55. A key role of an airport strategy is to provide a framework for a co-ordinated approach by the many interests who can influence the way environmental problems are tackled. Nevertheless, the consultations confirmed the existence of an apparently inescapable clash of interests, which has appeared in its most acute form when proposals for new airports have been presented. On the one hand, there is a legitimate demand that aircraft noise and congestion should be minimised in the heavily populated urban areas that are affected by the existing busy "city" airports such as Heathrow, Manchester, Birmingham and Glasgow. On the other hand, there is justifiable, and often well articulated, resentment among the relatively much smaller populations who live in areas which retain some rural character and which are seen to be threatened by increased use of airports situated in more open areas. Representations on this score have highlighted particular resistance to the introduction or intensification of aircraft noise in areas which are claimed to have relatively low ambient noise levels; to the imposition of heavy traffic on country roads; and to changes of character in an area that can be brought about by new house building and associated developments needed to accommodate those involved in the running of the airport and in service and related activities.
AIRCRAFT NOISE
56 Not only did the consultations confirm that, of all the problems associated with airports, the disturbance caused by aircraft noise remains the most serious, but they reaffirmed the particular severity of the problem around Heathrow. At present, using the Noise and Number Index (NNI) as a guide, within the 35 NNI contour 2 million people are affected by aircraft noise at Heathrow compared with around 450,000 at all the other principal airports in Great Britain considered in the consultation documents. By 1990 the number of people affected around Heathrow is forecast to decline to less than 300,000 due mainly to the wider use of larger quieter aircraft but even so the problem will still be greater at Heathrow than elsewhere in the country. This has been a major consideration in the development of an airport strategy for the South East of England.
57 Many of the comments received during the consultations drew attention to the alleged shortcomings of the Noise and Number Index as a measure of noise disturbance. The Government accepts that there are deficiencies in the NNI. However, in the absence of an alternative which is as widely accepted, and which will permit a comparative examination of different airports over an extended period, the Government considers that the NNI remains as good a measure of aircraft disturbance as is available. A fundamental change in the system would make comparisons with the past difficult to assess and monitor. Nevertheless, there is general agreement both in the United Kingdom and elsewhere that there would be benefit in the adoption of a uniform scale for the measurement of noise disturbance. It is, therefore, the Government's intention to continue, in consultation with those concerned, to examine possible alternatives to the NNI, including the Scale of Equivalent Continuous Sound Level (Leq). The Leq covers all forms of noise and has certain advantages over the NNI. It would, for example, include helicopter noise which was the subject of particular concern in the consultations, and for which the Government is keen to establish a reliable basis for measurement in order to assess the scale of the problem.
It is accepted that the reaction of individual people to noise varies greatly and this was shown in the surveys from which the NNI was developed. However, for purposes of comparison the reaction of an "average person" has been adopted and in this context the 35 NNI is generally taken to represent a level of "low annoyance" to aircraft noise. It is recognised that outside the 35 NNI contours there are people whose reaction to aircraft noise is more acute than that of the average person and that in consequence they suffer more annoyance. Where complaints suggest that there may be circumstances which exacerbate the aircraft noise problem outside the 35 NNI contour, special investigations will continue to be made. It has been suggested that one of the main reasons for the apparent disturbance caused by aircraft in certain areas some distance from airports is the lower ambient noise levels to be found in those places. While there is a need to balance the impact of aircraft noise, the Government acknowledges that the perception of aircraft noise may be more acute in areas where the general environment is normally very quiet, but this needs to be weighed against the desirability of causing disturbance to as few people as possible. Regardless of the way annoyance from aircraft noise is measured, and notwithstanding the special case of Concorde, the essential conclusion of the work undertaken for the airport strategy consultation documents was that over the next 15 years there would be a marked decline in the degree and extent of disturbance from aircraft noise. Certain of the assumptions on which the noise forecasts were based were criticised in the consultations. It was suggested that the forecasts assumed a rate of introduction for the newer generation of quieter and larger aircraft that was unlikely to be achieved. It was considered that the forecast average number of passengers per aircraft, which through its influence on the number of air transport movements has a significant effect on the noise forecasts, was too optimistic. It was implied, particularly by those concerned with the regional airports which have seen relatively few of the new generation of jets, that these aircraft were not in fact significantly quieter than those currently in use.
The forecasts for the introduction of new aircraft are based not on a simple extrapolation of past trends, but on a detailed analysis of airline fleets including: the ages of existing aircraft; the known retirement plans of the airlines; the likely demands of the world's airlines; and the new aircraft which are being, or are expected to be, developed. Leaving aside for the moment the earlier retirement of noisy aircraft, which the Government is actively pursuing within the European Civil Aviation Conference (ECAC), it is forecast that by the late 1980s all but a small proportion of existing airline fleets will have to be replaced. These replacements will not necessarily be wide bodied aircraft, but irrespective of their configuration they will be required to meet, at least the then current noise certification standards. British Airways is giving greater priority in its fleet planning to the replacement of its Tridents with new, quieter aircraft. The new aircraft would complement British Airways fleet of Trident aircraft, which is one of the quietest of the modern generation of wide bodied aircraft, and a major consideration in its selection would be noise performance. This would produce a significant reduction in noise disturbance in the vicinity of Heathrow and other airports presently served by Trident aircraft.
So far as the noise characteristics of the new generation of jet aircraft are concerned there is no doubt that these show a substantial improvement on earlier aircraft. For example, at the noise certification measuring points under the flight path(1)
(1) Noise certification points are 6.5 km from the start of take-off and 2.0 km from the runway threshold on approach; there is an additional point used in certification tests to the side of the take-off path. a Boeing 707 - 320B would on average register 113 EPNdB at take-off and 116 EPNdB on landing, compared with 97 EPNdB and 103 EPNdB respectively for a Tristar, an aircraft which is 30 per cent heavier. A reduction of 10 decibels is equivalent to halving the apparent noisiness. The trend towards the quieter aircraft which will increase during the 1980s as the earlier jets are retired from service, is already apparent at Heathrow where over 20 per cent of aircraft movements are now by aircraft meeting current noise certification standards.
62 The Civil Aviation Authority will take aircraft noise into account when considering competing applications for a transport licence for services to and from London airports. The Government also takes this problem into account in carrying out all its duties in the civil aviation field.
63 Because of the large number of overseas airlines which operate in the United Kingdom and because so many of the aircraft used are of foreign manufacture, the full benefit from action to reduce aircraft noise can be achieved only through the widest possible international agreement. The Government will, therefore, continue its efforts within the International Civil Aviation
(2) PNdB—Perceived Noise Decibels is a scale of aircraft noisiness as perceived by the human ear, it being more sensitive to some frequencies than others. EPNdB—Effective Perceived Noise Decibels is the PNdB scale with a weighting for pure tones (single frequency tones) and for the length of time for which the higher noise levels are experienced. The EPNdB scale is used in aircraft certification under the rules of the International Civil Aviation Organisation. Organisation (ICAO) to seek agreement on the adoption of progressively more stringent noise standards in particular for new subsonic jet aircraft. New, stricter noise standards will be presented to Parliament for approval as soon as proposals formulated in ICAO have been agreed by the Council of the Organisation, probably early in 1978. These latest ICAO standards will take advantage of the advances that have been made in acoustic technology since the original standards were set in 1969. As with the original standards, the revised standards will apply initially to new types of subsonic jet aircraft, but discussions are now proceeding in ICAO with a view to agreeing a date from which all new production of existing subsonic jet aircraft should conform to the new standards. Developments in acoustical technology are also being kept under review with the aim of setting even more rigorous standards when these become practical and economically reasonable.
Within the framework of the European Civil Aviation Conference, the United Kingdom has been playing a leading part in studies on the scope for restricting the use of non-noise certificated subsonic jet aircraft and for encouraging the introduction of new quieter aircraft. As a result of these studies, the Government proposes to prohibit the use of non-noise certificated subsonic jet aircraft acquired by any UK operator. after the 30 September 1978 and to prohibit from 1 January 1986 the use of all non-noise certificated subsonic jet aircraft on the UK register. These measures will ensure that a large proportion of the aircraft using UK airports in the middle and late 1980s will have markedly better noise characteristics than many current aircraft. Similar measures are expected to be introduced by other States and the Government will continue to seek agreement within ECAC on further measures to promote the development and use of aircraft incorporating the latest advances in noise abatement technology.
65. A number of developments suggest that the average number of passengers per aircraft in the 1990s may be somewhat lower than was predicted in the consultation documents. The pattern is likely to vary as between airports depending upon the type of traffic. For example, at regional airports it is likely that the introduction of wide bodied aircraft will be slower than in the London area because of the lower density of traffic, and that the operation of older generation aircraft may be prolonged beyond the date by which they might be phased out at the London airports and other major aviation centres. The forecasts in the consultation documents took account of this expected pattern of development and it remains true that the general improvement which is envisaged in aircraft noise will be experienced throughout the country. All forecasts involve a degree of uncertainty, from which the assessment of aircraft noise cannot be exempted. In particular, the forecasts as they apply to particular airports are dependent not only upon the assumptions discussed earlier but also upon the routes followed by aircraft from a particular airport and the way in which airlines deploy their aircraft. Since the publication of the noise forecasts in the consultation documents a number of developments have taken place which might alter some of the assumptions on which those forecasts were based. Some developments, such as the slower introduction of new aircraft will tend to reduce or delay the benefits envisaged over the period to 1990. But others will advance the expected improvements and international agreement on restricting the use of the older aircraft would accelerate the process still further. At Heathrow where the proportion of noise certificated aircraft has been rising steadily and is now over 20 per cent of the total, passenger traffic increased by nearly 13 per cent between 1973 and 1976, but air transport movements decreased by over 4 per cent. These developments give some expectation of a trend which will spread to other airports. In general, the Government remains convinced that by 1990 the noise situation will show a significant improvement on the present position at all airports. The rate of improvement will vary between airports and may be somewhat slower than envisaged previously, but the most marked improvement should be at Heathrow. will take time to develop and it will be some time before a noticeable improvement in the present position can be distinguished. In the meantime, the Government, airline operators and airport authorities will continue to implement a wide range of measures to mitigate the effects of aircraft noise. It is the Government's intention that these various measures should be maintained and that new policies should be introduced where these can be shown to be cost effective and consistent with safety. The Government believes that airport charges which take account of aircraft noise levels could provide a useful economic incentive for the development and use of quieter aircraft. The Government has therefore sought powers to ensure that airport authorities, in their charging policies, are legally entitled to discriminate between noisy and quieter aircraft. The United Kingdom is taking a leading part in discussions in ECAC and the Organisation for Economic Cooperation and Development about the form in which noise related charges could most usefully be introduced at major airports. The Government has proposed that the charge should be related to the aircraft noise measured under noise certification conditions and that it should increase with the intensity of the noise. With regard to existing policies, the Government confirms the continued use of runway alternation at Heathrow and the general policy under which aircraft are required to fly along minimum noise routes. It accepts the arguments which have been put forward emphasising the importance of stability and the need to avoid changes in these routes once they have been agreed. Aircraft movements at night present special problems; from the standpoint of the air transport industry, night operations have some important advantages, particularly in relation to cargo, but for people living around airports, disturbance of sleep seems to be the most disruptive feature of aircraft operations. It has been for some time the Government's policy to obtain a progressive reduction of aircraft noise at night, and at Heathrow and Gatwick, restrictions on movements by jet aircraft at night have been gradually tightened. However, the Government has decided to develop a long term strategy for reducing night noise disturbance by aircraft and in March 1977 it published a consultation document setting out two possible ways in which this might be achieved at Heathrow and Gatwick. These alternatives were either to reduce progressively the number of permitted night flights until they were eliminated, when the airports would be closed at night, or gradually to phase out night flights by noisier aircraft so that the only movements would be by quieter aircraft such as the Tristar, A300B and non-jet aircraft. Having considered the responses to the consultation document, the Government decided to confirm that all flights by noisier aircraft at night would be phased out at Heathrow and Gatwick over a period of about 10 years. The Government recognises that this policy at Heathrow and Gatwick could lead to an increase of night movements by noisier aircraft at Stansted and Luton. It has therefore decided to phase out movements at night by these aircraft at Stansted. The Government expects the management of Luton Airport to take full account of the Government policy on reducing night noise. and to follow suit.
69 Evidence is limited as to how much the quieter aircraft also disturb sleep, although it suggests that these aircraft will disturb the sleep of far fewer people than other types of aircraft. As foreshadowed in the consultation document, "Night Disturbance from Aircraft Noise at Heathrow and Gatwick" the Government has decided to fund a programme of research into the relationship between aircraft noise and sleep disturbance. The results are expected to be available in 1980. Pending the results of this research, quieter jet aircraft such as the A300B, Tristar and non-jets will be allowed to operate at Heathrow and Gatwick within quota restrictions which will be set so as to ensure that there is no overall increase in aircraft movements at these airports at night, and which will increase as the noisier quotas decrease. When the results of the research on noise disturbance at night are available the Government will decide whether to restrict it in any way, or to phase out, movements by these quieter aircraft at any or all of the designated London airports.
70 It will remain important to avoid creating new areas of housing close to the major airports where aircraft noise will inevitably continue to be a serious problem. Advice to local... planning authorities in Great Britain on the control of development in areas which are, or are expected to become affected by aircraft noise is already contained in "Planning and Noise" Department of Environment Circular 10/73, Welsh Office Circular 16/73 and Scottish Development Department Circular 23/73. The Government intends to reaffirm and clarify that advice, particularly with regard to proposals for housing development between the 40 and 60 NNI contours. In the case of existing developments the position can be relieved to some extent by the noise insulation of buildings. Grants for the insulation of dwellings are available at a number of airports. The noise insulation grants schemes for Heathrow and Gatwick closed at the end of 1977, and the Government intends to consider what further measures are necessary.
ACCESS
71 Airports are major traffic generators and questions of road and rail access figured prominently in the consultations.
72 Some of those consulted argued against significant expansions at existing airports on the grounds that these could lead to congestion on the approach roads and also that this would give rise to inconvenience and loss of amenity in the areas affected. These are important considerations and are reflected in the strategy set out in the following Section. Generally, however, the country's airports are well served by the existing and presently planned motorway and trunk road network and the further development of airports envisaged for the 1980s should not call for disproportionate expenditure on new works. In particular, completion of the M25, which has been accorded priority to provide an adequate route around London, will not only help industry and commerce and relieve residential areas of heavy traffic, but will also serve, and link, London's two main airports at Heathrow and Gatwick.
73 There were also representations that central Government funds should be specifically available for road improvements around those airports, particularly Heathrow and Gatwick, which have a more than purely local function. Under the policies set out in the Transport Policy White Paper, the Government will continue to give priority to improving those routes to the major ports and other industrial areas which carry a high proportion of industrial traffic. Within these policies the Government recognises the need for adequate access to airports which are important to the country's international trade and balance of payments. The Government will take this into account in considering schemes for roads for which it is responsible. As far as local transport is concerned however, it must be for the local authorities to assess their priorities in cases where, as a result of airport expansion, improvements to local roads are thought desirable, and to make any appropriate provision in their Annual Transport Policies and Programmes, on the assessment of which the distribution of Transport Supplementary Grant to County Councils in England and Wales is based.
74. It was argued that improvements to public transport to airports could ease possible problems with road access particularly at the times when workers are travelling to and from the airports. The Government agrees that it is desirable to make the best use of public transport. Indeed, with the completion of the Piccadilly Line extension linking Heathrow direct to the London Transport underground system, and with the improvements to the Gatwick rail services, these two airports will be well served by rail. During the consultation process there were suggestions for an additional rail link to Heathrow, for rail services for Stansted and Luton and rail links to other airports including Edinburgh and Prestwick. The commercial feasibility of such possibilities must be initially for British Rail to consider. Other suggestions for improved airport bus services, including services to main line railway stations are matters for the operators concerned together with the local authorities and their Transport Policies and Programmes. There will be a continuing need for airport authorities and public transport operators to work closely together to co-ordinate interchange facilities, involving air, rail and bus services and the provision of travel information. Finally, proposals were made for the use of long distance rail services to promote the diversion of traffic from the London airports to airports outside the South East. Birmingham airport, with a recently constructed station on the main line from Euston serving the airport and the National Exhibition Centre, was suggested for development in this context, and there were also suggestions for a rail connection to East Midlands airport from the St Pancras-Nottingham line. A relatively long rail trip to an airport might be acceptable in cases where the rail journey is in much the same direction as that of the onward movement by air, and where the air passenger has an easily accessible main line railway station. But travel is expensive and future supplies of energy and particularly oil are uncertain. Transport systems which would involve considerable "dead mileage" as well as loss of time through the introduction of additional inter-modal changes, do not make sense. Because the majority of air trips from this country are to the South, the Government does not believe, therefore, that there is much scope for re-routeing genuine London area traffic demands through airports that are located at substantial distances to the north. As far as the 1980s are concerned, it is unlikely that rail transport to airports will play a significant role except at Heathrow and Gatwick and, to a smaller extent, at Birmingham.
In the course of the consultations there were representations particularly from within the South East, that airport developments should not be allowed to cut across the provisions of regional planning strategies and development plans. The Government believes that, while major infrastructure items such as airports can raise conflicts of interest between local regional and national requirements, ways have to be found of reconciling these different interests. This has been one of the purposes of the consultations and of the resulting airports strategy.
Many of the land-use planning consequences of large scale airport expansion result from the employment opportunities provided by an airport and in airport related activities and local services. The prospects of additional employment have been welcomed at airports in the Assisted Areas. Indeed, from most areas of the country, including the London area, there was recognition of the benefits which increased, secure airport employment could bring. But the burden of many of the representations, particularly from the South East, was that demands for housing induced by major airport expansion would threaten villages and valued areas of countryside, many of them enjoying the protection afforded by Green Belt policies.
Reflecting these considerations, the Government's airport strategy has as an important objective the growth of traffic at selected regional airports and particularly at airports in the Assisted Areas. However, the London area airports will continue through the 1980s to cater for the greater part of the national demand for air travel. During the consultations concern was expressed that the existing airports in the South East would expand more or less indefinitely, exacerbate environmental problems and congestion, and cause serious difficulties for the local authorities responsible for planning and servicing the areas affected. Uncertainties about the precise ways in which a large and complex facility such as an airport may be used and operated in the future can never be entirely eliminated. However, the Government believes that its strategy with its acceptance of limitations on the number and size of terminal to be built at particular airports, will meet the situation.
As regards procedures for controlling the development of airports, many local authorities and amenity groups in the South East expressed dissatisfaction at the extent of the developments which the BAA is permitted to carry out at its airports under the Town and Country Planning General Development Order 1977 and the Town and Country Planning (General Development) (Scotland) Order 1975. The Government recognises the efforts which the BAA makes to inform, consult and respond to local interests. Nevertheless, it accepts the logic of the argument that the present provisions of the General Development Order were framed before the advent of large aircraft and when runways were regarded as the main determinant of airport capacity whereas passenger and cargo terminals have now emerged as significant factors. The Government, which intends that control over the provision of major new terminal capacity should be a feature of its airport strategy, is carrying out a general review of the statutory undertakers' provisions in the General Development Order. In the course of this it will be discussing with the BAA and the local authority associations modifications designed to bring under normal planning control the provision by the BAA of major passenger and cargo terminal buildings. In the meantime, the Secretary of State for the Environment, has made a direction under article 4 of the General Development Order making it necessary for the BAA to seek specific planning permission for its proposal to build a fourth terminal at Heathrow.
80 There was some criticism in the course of the consultations about the situation at local authority owned airports where the local planning authority could have a direct interest in any proposed development. The Government is satisfied, however, that the statutory planning arrangements governing local authorities' own development proposals provide adequate safeguards and are operating effectively.
81 Thus all the main airport developments provided for in the strategy will be subject to statutory planning procedures. These allow for public inquiry in cases where this is justified and the Secretary of State for the Environment has already announced his intention to hold such an inquiry into the BAA's proposed Heathrow fourth terminal. The Government believes that airports, as important public transport facilities and sources of employment, should be treated as integral components of regional strategies and of local authorities' plans. They cannot be regarded as developments to be accommodated, if possible, only after other planning considerations have been met, nor can they be imposed on communities without regard for the implications for the locality. With this in mind the Government's objective is to seek to improve the arrangements for consultation over the development of airports policy with the local planning authorities and the aviation interests. SECTION 4: A NATIONAL AIRPORTS SYSTEM
INTRODUCTION
82 Having established the framework for a national airports strategy in Section 1, it is necessary to relate this to individual airports, taking account of the demand described in Section 2 and the environmental considerations outlined in Section 3.
83 One of the main lessons to be learnt from the Roskill Commission on the third London airport is the need for caution in the planning of airports capacity. While the growth of air transport has now resumed, following the recession of the last few years, the decisions which follow relate to the short and medium term up to the late 1980s. It will be necessary to give further consideration to the longer term requirements especially for the London area, but also more widely in co-operation with local planning authorities.
THE LONDON AREA AIRPORTS
84 There are four main airports in the London area: Heathrow which by 1978, when existing redevelopment work is completed, will have a capacity of 30 million passengers a year; Gatwick with a capacity of 16 million passengers when rebuilding is finished in 1978; Stansted capable of handling 1 million passengers and Luton with a capacity of 3 million passengers a year. Heathrow, Gatwick and Stansted are owned and operated by the British Airports Authority, while Luton is owned by the Luton Borough Council. There are other airports in the London area, including Southend, but the Government does not consider that any of these can make any major contribution to the handling of air transport movements though, as is explained in paragraphs 144-151, some of them are expected to fulfil an important role as short haul and general aviation airports.
85 The existing main airports in the London area are geographically conveniently grouped round the capital and well placed in relation to the existing and developing trunk road and motorway network. Additionally, Gatwick is directly served by the British Rail line to Central London and, with the completion of the Piccadilly line extension is connected to the extensive London Transport underground system. Movement between all four airports, and especially between Heathrow and Gatwick, will be facilitated when the M25, which is receiving top priority, is completed. Each of the airports is capable of expansion so that together they could meet the forecast air traffic demand in the 1980s. Hence the London area airports of Heathrow, Gatwick, Stansted and Luton should be capable of development, during the 1980s, as a single category A gateway international airports system. The capacity of about 50 million passengers a year which will be available at these airports from 1978 should be sufficient to cater for demand into the early 1980s, but this will require some redistribution of traffic among the airports and a clearer definition of the roles of the four airports. The most immediate objective is to build up traffic at Gatwick to use the extensive new facilities now nearing completion at that airport, and to relieve the serious congestion which is expected at Heathrow from about 1981. The Secretary of State for Trade announced the Government's policy for the transfer of services from Heathrow to Gatwick on 5 April 1977. This policy, which is crucial to the accommodation of air traffic in the London area at standards which air passengers should expect, requires the full co-operation of the airline operators, for whom the facilities have been provided, and of the other aviation authorities concerned. The need for flexibility has been emphasised earlier, but within this multi-airport system the Government envisages that in general terms Heathrow and Gatwick will develop as the two major international airports for scheduled services, that the principal role for Stansted will be for the handling of long range charter services which are most suited to the airport's facilities, and that Luton will continue to handle short and medium range charter flights, but in future concentrating increasingly on passengers from the South East of England. If Luton Borough Council and the BAA were to agree to a transfer of ownership of Luton airport this would assist the BAA in exercising its major executive and co-ordinating role in the development of the London airports system.
Heathrow
Heathrow is the largest international airport in the world. and it has been an important factor in the development of British civil aviation since the Second World War. It plays a major role in the country's trade and commerce and in international tourism; and it provides directly over 50,000 jobs. Against this background the consultation document put forward, as an option for the 1980s, a scheme aimed at realising Heathrow's full potential as a possible five terminal airport. This would involve the acquisition, by the BAA, of additional land between the runways at Perry Oaks at the western end of the airport and the replacement of the important sewage sludge disposal facilities at present located on this land.
The Government has considered carefully the representations which have been made both for and against this project, which would increase the capacity of the airport to over 50 million passengers a year. Heathrow occupies a restricted site which is markedly smaller than that of most other international airports though these handle significantly less traffic. The Government does not consider that it would be feasible to handle satisfactorily such a volume of traffic at Heathrow or to provide, at a reasonable cost, adequate road, and possibly rail, access. Finally, and although even with such a development the level of noise disturbance could be expected to improve consistently and significantly over the years, noise disturbance at Heathrow will remain worse than at any other airport in the United Kingdom. The provision of a fifth terminal would reduce to some degree the improvement in noise disturbance which those who live in the Heathrow area might otherwise be entitled to expect and cast doubt on the continued practicability of the policy of runway alternation.
89 In the light of these considerations, the Government concluded that Heathrow's ultimate development should not go beyond that of a four terminal airport; a level of expansion which, as was explained when the Government announced, in July 1974, the cancellation of the Maplin project, was called for whether or not Maplin were built. The BAA currently proposes to build a fourth terminal on the south side of Heathrow. This proposal figures in the BAA's Master Plan for Heathrow, published in March 1976, and was the subject of a Background Note, upon which the local planning authorities were consulted in January 1977. As already stated, in paragraph 81, this proposal will be the subject of a public inquiry.
Gatwick
90 With the completion of existing works next year, Gatwick will have a capacity of 16 million passengers a year. The airport's single runway presents an effective constraint on the number of air transport movements and hence on the extent to which Gatwick might be developed, but as the consultation document explained, the capacity of the single runway should be sufficient to sustain the traffic from a second terminal which would raise the capacity of Gatwick to 25 million passengers a year.
91 During the course of the consultations doubts were expressed about the practicability of handling this volume of traffic with a single runway; about the difficulties which would be involved if the runway had to be closed; and about the problem of runway maintenance. There is at present no airport in the world which is handling a throughput of about 25 million passengers a year off a single runway. Indeed, there are very few airports with this amount of traffic. However, the British Airports Authority is convinced that there are no overriding reasons why such levels of traffic should not be accommodated with a single runway. The runway capacity at Gatwick will be 160 thousand air transport movements per year and with the increasing numbers of passengers per aircraft expected in the London area in the period up to 1990 there is no reason to suppose that the longer term utilisation of two terminals at Gatwick would be inhibited by runway constraints. There would remain the possibility that the runway might be obstructed, with the result that the airport would have to be closed. Experience suggests that the probability of this happening is very low, and for this reason, and recognising that other runways are available in the London area, the Government does not consider that expenditure of £10-20 million on the provision of a second runway, which would be required on only rare occasions, would be justified. As far as maintenance is concerned, the British Airports Authority has already carried out major repairs and resurfacing of the runway at Gatwick without any interruption to services and there is no reason to suppose that this cannot continue.
92 Gatwick is within an area which was identified as a major growth area in the Strategic Plan for the South East, though during the consultations there were representations that there could be difficulties in coping with the increased employment and the growth of road traffic which could arise if the BAA went ahead with a second terminal in the 1980s. The rail/link at Gatwick, which provides a frequent train service to and from Victoria already offers a convenient means of transport for a large proportion of air passengers. The Government believes that the opportunity which this affords for an integrated rail/air system should be actively pursued by British Rail, BAA and the airlines concerned.
93 As was explained in Part 1 of the consultation document, while the number of people troubled by aircraft noise at Gatwick is only a fraction of those affected at Heathrow, noise disturbance at Gatwick is expected to increase over the next few years as traffic rises at the airport to utilise the new capacity which will become available in 1978. By the time the second terminal would be required, some time in the mid 1980s, it is forecast that the noise situation around Gatwick would be improved and the additional capacity envisaged would be unlikely to reverse this continuing improvement. Government policy for reducing disturbance at night will ensure that the growth of traffic at Gatwick will not be accompanied by a growth of night disturbance.
94 In the light of these considerations the Government sees no objection to the BAA bringing forward for examination through the appropriate planning procedures proposals for the development of Gatwick during the 1980s as a two terminal airport with an ultimate capacity of around 25 million passengers a year. For various reasons, including the collapse of resident airlines, the existing terminal facilities at Stansted, which have sufficient capacity to handle 1 million passengers a year, have been very much under utilised in recent years. Over time this surplus capacity will be brought into use. Part 1 of the consultation document considered two possible levels of further development for the 1980s: to 4 million passengers a year, which would involve an extension of the existing terminal and associated facilities, and to 16 million passengers a year, which would reproduce at Stansted the level of development now being provided at Gatwick. Both these developments would be contained within the existing boundaries of the airport and would not involve any further runway development.
During the consultations there was a good deal of local opposition to, but also some support for, the development of Stansted. The opposition concentrated on three issues. First, that earlier inquiries had concluded that Stansted should not be developed; secondly, that additional noise disturbance would be unacceptable in an attractive rural environment; and thirdly, that expansion would conflict with the strategic plan for the South East of England and the general planning objectives of the local authorities. The earlier inquiries and the Roskill Commission were concerned with the provision of a massive new airport at Stansted, involving the acquisition of additional land for the accommodation of four runways and capacity for up to 50 million passengers a year. What was considered in the consultation document was a much more modest development which bore little resemblance to the project with which the Roskill Commission was concerned. The support for some expansion of the airport emphasised two points: the need to use more effectively the resources available at, and the potential of, the airport; and the maintenance of existing employment and the additional jobs which would be provided.
97 In relation to aircraft noise disturbance, Stansted is perhaps one of the most satisfactory existing airports in Great Britain at which to accommodate the expansion of air traffic. The consultation document demonstrated that fewer people would be affected at Stansted in 1990 with a throughput of 16 million passengers than at almost any other airport in Great Britain. It indicated that around 2,000 people would be affected by noise at Stansted in 1990 with a throughput of 16 million passengers a year compared with over 200,000 at Heathrow with 38 million passengers. Hertfordshire County Council, in their submission on the consultation document, provided alternative estimates of noise disturbance at Stansted taking into account test and training flights and including less optimistic assumptions concerning the rate of introduction of quieter aircraft. As air transport movements increase test and training flights can be expected to decline, but in any case these alternative estimates do not alter the basic conclusion that, in terms of aircraft noise disturbance, Stansted has significant advantages over other airports.
The Government is conscious that the development of an airport in a primarily rural area could be intrusive and, because of the existing low ambient noise level, cause somewhat greater noise disturbance than might be the case in some other areas. However, as a guide to public policy, the Government does not accept that because populations surrounding existing airports may have become accustomed, to some extent, to high levels of noise, they should be expected to tolerate the imposition of yet further noise disturbance. The Government considers that the principal criterion should be the numbers of people expected to be affected by particular airport developments.
Stansted is well situated, access by the M11 to outer London is good and the aircraft noise situation is superior to that at any other airport in the London area. Moreover, the airport has a good runway and adequate facilities, all of which are grossly under utilised. The Government sees no objection to the BAA bringing forward proposals to develop the airport to accommodate 4 million passengers a year so that these may be examined through the appropriate planning procedures. On the other hand development of Stansted to a capacity of 16 million passengers a year would raise wider issues, including major changes in the planning policies for the area. Therefore, as is explained later in this document, a major expansion of Stansted would be only one of the options to be examined to meet longer term demand in the London area.
Luton
100 Luton airport is currently handling about 2 million passengers a year; although before the recession in air travel the throughput of the airport was in excess of 3 million passengers. With modification and additions to the existing terminal, Luton airport could handle 5 million passengers a year. This growth in traffic was considered in the consultation document, along with a more fundamental redevelopment of the airport to increase the capacity to 10 million passengers a year by the provision of a new terminal.
101 There was support, notably from the Bedfordshire local authorities, for an expansion of the airport's capacity to around 5 million passengers a year. This was influenced by the benefits which were seen to flow from possible increases in airport and service employment in an area that is heavily dependent on industries associated with vehicle manufacture. However, there was also considerable opposition, particularly from Hertfordshire, to any increased use of the airport mainly on the grounds that this would give rise to noise problems and to demands for new housing.
102 Because of its pre-eminent role in handling charter flights, Luton airport has had a greater proportion of night flights, compared with daytime flights, than other airports in the London area. The Government has announced its intention steadily to reduce night time disturbance at Heathrow and Gatwick. It would expect the same situation to obtain at Luton. Generally, as in the case of Stansted, aircraft noise at Luton affects fewer people than at other airports in the London area and the regions. A throughput of 5 million passengers a year, which would build up over a period, should not affect the forecast of an overall improvement in the noise situation, which by 1990, should be significantly better than at present.
103 The Government does not consider that Luton airport is suitable for major development. However, Luton is an integral part of the London airports system within which it fulfils an important role. The Government has concluded therefore that Luton airport should be restricted to a capacity of 5 million passengers a year. As pointed out in paragraph 86, the transfer of ownership of the airport to the BAA would be consistent with its role in the London airports system. Adequacy of proposed developments
104 The developments outlined above would provide terminal capacity to handle approximately 72 million passengers a year. Even at the highest passenger forecast, these terminal developments should be sufficient to accommodate demand up to and beyond the middle of the 1980s and quite possibly it could prove adequate up to 1990.
105 The ability of each airport to utilise its terminal facilities is affected by its runway capacity to cater for the anticipated number of air transport movements. An important element in assessing the level of aircraft movements is an estimate of the average number of passengers per aircraft which depends on various factors, including the rate of growth of traffic, the fleet replacement plans of airlines and the type of traffic handled. The most recent indications are that the progressive introduction of the larger aircraft will be slower than previously anticipated which, with the higher proportion of short haul traffic which is now forecast, will reduce the average number of passengers per aircraft expected at the London area group of airports to between 150 and 165 in 1990. The latest estimates of runway capacity at the four London airports are: 275,000 air transport movements at Heathrow, 160,000 at Gatwick and 120,000 at Luton and Stansted combined. The capacities for Heathrow and Gatwick represent a reduction in the earlier estimates due mainly to new standards of separation between aircraft arriving and departing. However, even assuming that the average number of passengers per aircraft is towards the bottom of this range at each airport, runway capacity should be sufficient to accommodate the maximum levels of development envisaged in the strategy for the 1980s.
106 The CAA has given further consideration to the ability of the air traffic control system to accommodate air traffic demand, not only in relation to runways, but also in respect of the route system within the airspace surrounding the major airports and the radiating air routes. This has revealed no major problems in handling any of the likely airport capacity combinations that might be considered in the period to 1990.
The longer term
107 If air traffic continues to grow, in the longer term additional capacity will be required. No further development at Heathrow beyond a fourth terminal, at Gatwick beyond a second terminal, and at Luton beyond a single terminal, is envisaged. For the longer term therefore the possibilities are a major expansion at Stansted; the development of an existing military airfield as a civil airport for the London area; or the construction of a new airport. The Government will, therefore, seek advice on the longer term provision of airports capacity, taking into account the need to involve the local authorities more closely in the identification of available options. Costs
108 The former Maplin strategy was based on the completion of a fourth terminal at Heathrow and the opening of the first phase of the Maplin development in the early 1980s. This would have made a second terminal at Gatwick unnecessary and would have made possible the closure of Stansted and Luton to air transport movements. The present strategy will rely on a second Gatwick terminal together with Stansted and Luton to provide capacity for some 18 million passengers a year, equivalent to the capacity which would have been provided by building one of Maplin's runways and two of its proposed terminals.
109 The capital cost, exclusive of interest charges, involved in providing a runway and two terminals at Maplin would have been £680 million based on estimates given in the Maplin Review updated to end-1976 prices. This would cover the relocation of the Defence Establishments and land reclamation as well as the costs of new airport facilities. On the same basis, using updated costs given in the consultation document, the present strategy costs for Gatwick, Stansted and Luton would be about £150 million.
110 Additionally, Maplin on a remote and inaccessible site some 50 miles from London would have had little chance of success unless it were provided at the outset with a motorway link at least to the M25 and with a high-speed railway. These, with local road and rail connections, would have cost about £1.10 million at end-1976 prices. The costs of any road and rail improvement schemes that might be called for in connection with increased use of Gatwick, Stansted and Luton would not be significant in comparison with the costs of access to Maplin.
AIRPORTS OUTSIDE THE SOUTH EAST
Whereas the requirement in the London area is for additional terminal capacity to accommodate the demand, outside the South East of England and in Scotland and Wales the problem is to achieve a more effective use of the existing facilities. Bearing in mind the relative demands in the catchment areas, the Government considers that there is no scope for more than two gateway international airports (Category A), at Manchester and Glasgow/Prestwick, outside the South East during the period to 1990.
Central England
After the South East, Central England, which is taken to include the Merseyside, Manchester, Yorkshire and Birmingham conurbations, represents the largest catchment area for air traffic in Great Britain. The Government considers that in the 1980s the area should be able to sustain one international gateway airport and that it should be at Manchester.
113 At the present time Manchester airport, which is a major base for British Airways and used by many international airlines, is handling about 2½ million passengers a year. By 1990, and with the implementation of the policies envisaged in paragraphs 22 and 24, it is forecast that throughput might increase to around 6 million passengers. The existing terminal facilities at Manchester and a single runway should be adequate to accommodate this level of traffic. The state of the present runway at Manchester is giving some cause for concern and consideration is being given to whether, and if so how, it can be strengthened and improved. It is possible also that a limited extension of the runway may be required to enable the airport to fulfil completely its role as a category A airport.
114 During the consultation process, particular attention was drawn to the future of Liverpool airport. It was suggested that air traffic in the North West of England might be distributed between Manchester and Liverpool airports; that the two airports might be owned and operated together by a consortium of the relevant local authorities; that Liverpool airport might be redeveloped with a new passenger terminal, control tower and related facilities alongside the new runway, when the "old" airport could be disposed of for non-aeronautical purposes; or that Liverpool airport might be placed on a care and maintenance basis.
115 The basis of the Government's airports policy is that rationalisation of the facilities outside the South East of England, and concentration of air services at a limited number of airports, are likely to be among the most effective ways of seeking to redress the balance in air transport between the South East and the rest of Great Britain. The Government does not consider that the allocation of traffic between Manchester and Liverpool and common ownership of the two airports is likely to assist this objective. In the Government's view it is more likely to result in lower frequencies and a more limited range of services for the North West while not guaranteeing a viable future for Liverpool.
116 The Government believes that Liverpool airport should fulfil a local role as a category C airport providing some scheduled feeder services, notably to Ireland and the Isle of Man and perhaps to London and other major centres in England, Scotland and Wales; some charter services to the more popular destinations; and facilities for business and general aviation for Merseyside. In such a role the Government does not envision that Liverpool airport would be handling more than 1 million passengers a year by 1990. The immediate future of Liverpool airport must be a matter for the local authorities concerned. Redevelopment, as envisaged in paragraph 114, might have some attraction, but this would have to be considered on its commercial merits and not on the assumption of Government financial support.
117 There are two main airports in the Midlands: Birmingham and East Midlands. Birmingham airport, which handles over 1 million passengers a year, is long established, is well sited in relation to the national motorway and rail systems and the National Exhibition Centre and is a base for British Airways. Industry and commerce in the West Midlands has an important need for air communications and with the large population of the area there is likely to be a growing demand for a wider range of scheduled and charter services. On the other hand, the airport occupies a restricted site, and with built up areas to the north and west has difficult aircraft noise and environmental problems which have been the subject of extensive representations. Moreover, at times, the existing terminal is seriously congested and improved terminal and related facilities, which could be costly, would be required to accommodate the forecast growth of traffic in the 1980s. The local authority owners are presently considering proposals to increase the capacity of the airport.
118 East Midlands airport, although somewhat further from the main concentration of population in the Midlands, is also well sited in relation to the motorway network and has an important industrial and commercial catchment area. Fewer people are affected by aircraft noise than at Birmingham and the airport's modern construction lends itself more readily to expansion than Birmingham airport. However, East Midlands does not have at present the nucleus of domestic and short haul international services which are provided already from Birmingham, and a build up of traffic from the present level of nearly 600,000 passengers a year might be somewhat slower than at Birmingham.
Bearing in mind the limited scope for diverting traffic from the London area, the Government does not consider that the Midlands could sustain a category A airport in the period up to 1990. However, the Government has concluded that there is likely to be sufficient demand for air services in the Midlands to justify both Birmingham and East Midlands airports fulfilling the roles of category B airports in the period up to 1990. In the light of the existing division of traffic, and subject to the provision of additional terminal capacity, Birmingham, with a greater proportion of scheduled services, might be handling between 2 and 3 million passengers a year by 1990. At the same time, and with some modest extension to the terminal and other facilities, East Midlands, with more emphasis on charter traffic, might be handling about 1½ million passengers a year. 120 In the longer term, if air traffic continues to grow, and develop more strongly in the regions outside the South East, either East Midlands or Birmingham could be expected to develop into a Category A airport. In view of the restricted site and environmental problems at Birmingham, East Midlands might have the greater potential to assume that role. It will be important to see how the two airports develop into the 1980s.
121 Finally, in the Central England area, consideration must be given to Yorkshire and Humberside and specifically to the position of Leeds/Bradford airport. The limited length of the runway at Leeds/Bradford places a serious constraint on the aircraft which can use the airport and the services that can be operated. For long haul services Yorkshire and Humberside will continue to be served by Manchester and the London airports. The feeder service to London is at risk because of runway limitations which also affect the provision of short haul scheduled and charter services which are forced therefore to use other airports. Some of this traffic may use Manchester, or East Midlands, or the airports in the North East, but an important part of it goes through the London airports. The Government does not consider that the demand is such as to justify the massive expense which would be involved in the provision of a new airport in Yorkshire and Humberside. However, it considers that Yorkshire could sustain a category B regional airport. The Government does not envisage an extensive role for such an airport within a national strategy, but for Leeds/Bradford airport to meet this requirement would involve an extension of the existing runway. Consideration of this would be in the first instance a matter for the local authorities.
At the Central England airports the main problems of aircraft noise disturbance are at Manchester and Birmingham where at present levels of traffic more people are affected by noise than at any other airport in Great Britain with the exception of Heathrow, Gatwick and Glasgow. At both Manchester and Birmingham airports, and at traffic levels which now seem realistic, a significant improvement in the noise situation is forecast between now and 1990. The concentration of air services at a limited number of airports outside the South East should assist this process to the extent that it encourages the substitution of new, larger quieter aircraft for the smaller, older and noisier aircraft which might otherwise be used. Nevertheless, the Government recognises that aircraft noise is intrusive wherever it is; that some regional airports already experience far more noise disturbance than some airports in the London area; and that there is no justification for relieving the South East airports, particularly Gatwick, Stansted and Luton, by imposing an increased noise burden on, for example, Manchester and Birmingham airports. The introduction of new quieter aircraft and the action being taken to impose stricter noise certification requirements will benefit regional airports. as well as those in the London area, although the rate of improvement may be somewhat slower.
Apart from Manchester, Liverpool, Birmingham, East Midlands and Leeds/Bradford airports which have been considered already there are a number of other airports in Central England such as Blackpool, Coventry, Humberside and Norwich. The Government does not envisage a major role for any of these airports within the national airports system. Norwich, and perhaps Blackpool, can be expected to fulfil a category C role and Humberside may also develop as a third level airport. The main purpose of Coventry is likely to be as a category D, general aviation aerodrome.
Northern England
There are three airports in Northern England, at Newcastle, Tees-side and Carlisle. The North East of England presents particular problems where Newcastle and Tees-side airports are only about 40 miles apart. However, unlike the situation in the North West, where Manchester is a very much larger airport than Liverpool, there is not the same disparity in size between the two North Eastern airports. Neither is there the same potential demand. By 1990 it is forecast that there will be about 2 million passengers using the two airports. Newcastle is long established, handles about three times as much traffic as Tees-side, has rather more extensive facilities and is used by British Airways. On the other hand the future growth of Tees-side might generate a substantially increased demand for air services. By 1990 neither airport should have a serious noise disturbance problem.
The Government does not agree, as has been suggested, that steps should be taken to limit the expansion of Newcastle airport to enable Tees-side to catch up. It believes that the North East generally would benefit from some concentration of services at one or other of the two airports, since this would provide both better frequencies and a wider range of services than might otherwise be possible; and it recognises that each airport could sustain some domestic services, particularly a London service, and perhaps some short haul services to Europe. The Government considers that in practice Newcastle has certain advantages over Tees-side, notably as a base for British Airways, and it remains unconvinced that the growth of industry itself will generate sufficient demand to overcome the existing advantage of Newcastle.
The Government does not envisage circumstances in which a category A international gateway airport could be required in the North East of England, or at this stage that a major extension to the runways at either of the airports could be justified. The Government believes that the North East will benefit from a concentration of air services at Newcastle. However, given the facilities which are available at that airport and at Tees-side, and the importance of maintaining good connections from Tees-side for its industrial hinterland, the Government considers that there are valid reasons to support the continuing operation of both airports. It has concluded, therefore, that Newcastle should develop as a category B regional airport and that Tees-side should be a category C airport, with adequate domestic services and, where demand is sufficient, some short haul international services. The Government is aware that discussions are proceeding between the Newcastle Airport Authority and the BAA with a view to the BAA taking over the airport. Recognising the significance of air transport development in the North East, the Government takes the view that this action by the two authorities is consistent with the guidelines in this White Paper.
127 The predominant role of Carlisle airport is as a category D general aviation and training aerodrome. Given its excellent weather record and its remoteness from centres of population it will be the Government's intention to encourage a greater use of Carlisle airport for training. This could relieve pressure on airports particularly in the South East of England where such activities are a considerable burden both on airport capacity and on the surrounding communities. South Wales and South West England
There are five significant airports in South Wales and South West England; Glamorgan, Bristol, and Exeter which can be considered as a group and Bournemouth and Southampton(1) which may also be taken together. The airports at Bournemouth and Southampton are sufficiently close to the South East to have the prospect, identified in the consultation document, of attracting traffic from the London area. Bristol and Glamorgan airports might also in theory take traffic diverted from the London area. However, in the light of the consideration given to regional diversion in Section 1, the Government considers that it would be wrong to assess the roles of airports in South Wales and South West England on the basis of a major transfer of traffic from the South East. Taking this into account, it is unlikely that traffic over this wide area will amount to more than 3 million passengers in all by 1990. In these circumstances there is a danger that the available traffic could be spread very thinly among the airports and thus, as was pointed out by the Civil Aviation Authority in their study of airports in the region, lead to a poorer service particularly on scheduled flights than might be the case if traffic were concentrated at fewer airports.
At present, Glamorgan and Bristol airports handle a
(1) Southampton Airport is within the South East Economic Planning Region, but it covers broadly the same catchment area as Bournemouth Airport and it is convenient to consider the two airports together. similar volume and type of traffic, concentrating mainly on charter services, scheduled domestic flights and a few international scheduled services. It is likely that South Wales, the Bristol conurbation and South West England generally, could sustain one, but not two, category B regional airports. Neither of the two airports is ideally suited to accommodate the demand in both South Wales and South West of England. There is however a significant difference in the facilities available at the two airports. Although few people are affected by aircraft noise at either airport, the consultations showed some opposition to expansion at Bristol. On the other hand, none of the many representations received suggested that Glamorgan airport was environmentally unacceptable. Furthermore, expansion of traffic at Glamorgan would support the Government's regional development policies since the airport is in a Development area, close to a Special Development Area.
At Bristol, the present terminal is no more than adequate for the existing levels of traffic and its development as a category B airport would require considerable expenditure on new terminal facilities and some extension of the runway might also be necessary as well as improvements to the navigational facilities. In contrast, at Glamorgan the modern terminal is more than adequate, as are the runway and other facilities, to meet all foreseeable demands up to 1990. In the light of these considerations, including the expenditure which would be involved in the further development of Bristol airport and which, among other reasons, would rule out a new airport for Severnaide or the adaptation of Filton as a civil airport, the Government has concluded that Glamorgan should have the role of a category B airport. Bristol airport may continue to fulfil a local role as a category C airport, but this is a matter which the local authorities will wish to consider.
During the course of the consultations it was suggested that a combination of Glamorgan and Exeter airports would meet most satisfactorily the requirements of South Wales and South West England. Whether there should be any close and permanent association between Glamorgan and Exeter airports will be for the local authorities to consider, but given the relative remoteness of Cornwall and Devon, Exeter airport seems likely to retain its usefulness and to expand its role as a local, category C, airport.
Both Southampton and Bournemouth airports fulfil a similar role, and scheduled services to the Channel Islands, to meet a demand from a much wider area than that surrounding the two airports, are of importance. Southampton has a significant advantage over Bournemouth in terms of its location, and it also has a larger catchment area and a more extensive range of services. On the other hand, Southampton airport is privately owned and from time to time there have been doubts about its future. Furthermore, it occupies a restricted site which affords little scope for expansion to enable the airport to embrace a wider role. There is room for further development at Bournemouth airport, but there is considerable local opposition to its expansion. The Government does not envisage any major change in the roles of Bournemouth and Southampton airports or any requirement for significant additional development at either airport. The principal role for any airport in this area is to provide a link with the Channel Islands. The Government considers that in this connection Southampton has certain advantages over Bournemouth, that it should receive preference in the licensing of services to the Channel Islands, that the airport management should be encouraged to maintain and develop the role of Southampton as a category C airport, and that Bournemouth's function will be largely as a category D airport.
During the course of the consultations a good deal of concern was expressed about aircraft noise at Bristol, Bournemouth and Southampton airports, and in relation to the volume of traffic there are a significant number of people affected by noise at Southampton. However, given the limited roles which are now envisaged for Bournemouth and Bristol airports, and the physical constraints on Southampton airport, the Government does not consider that aircraft noise disturbance should be a major problem at airports in South Wales and South West England. Finally, under the Government's devolution proposals, the Welsh Assembly would have responsibility for planning and environmental matters associated with any future airport development in Wales.
Scotland
As the consultation document recognised, Scotland forms a relatively distinct unit in airport planning terms. The scope for diverting London traffic to Scotland apart from traffic with Scottish origins or destinations at present interlining(1) through London, is negligible, and, with the limited exception of the extent to which people in the Borders might look towards the North of England, there is no overlap with the catchment areas of airports in England and Wales. Historically, air travel has been more developed on domestic routes in Scotland than in the English regions. The distances involved and the relative attractiveness of air travel to London, compared with road and rail, have contributed greatly to the growth of Glasgow and Edinburgh airports to become the second and fourth largest outside the London area in 1976, and although the importance of the London route could diminish, this should be more than offset by the development of direct routes to other destinations. In recent years, Aberdeen, Sumburgh and Kirkwall airports have all experienced above average growth.
(1) An interline passenger is one who changes planes at an airport and has no other reason for visiting the airport. in passenger and aircraft movements as a result of the stimulus of oil related activities, and Aberdeen has been the fastest growing airport in the United Kingdom. Finally, the Scottish Highlands and Islands aerodromes, while not so significant in terms of the number of passengers handled, have an important social function in the isolated communities which they serve.
There is no shortage of runway or terminal capacity in Scotland and all the major airports have extensive modern facilities, or are being provided with them by the BAA which owns Aberdeen, Edinburgh, Glasgow and Prestwick airports. The situation in Central Scotland is complex and there is probably a greater excess of airport capacity in this region than anywhere else in Great Britain. It is probable that economies in operation for both airline and airport managements, with consequent benefits to passengers, would result from a better match between capacity and demand. Under the Government's devolution proposals responsibility for airports in Scotland is to be transferred to the Scottish Assembly, subject to agreement on the arrangements for airports operated by the BAA and CAA and to the reservation of functions related to the regulation and safety of civil aviation generally. Ultimately, therefore, longer term policies for airports in Scotland will be a matter for the devolved administration, but the Government believes that it may be helpful in this context to set down at this time its views on airport development in Scotland. Central Scotland
137 From time to time it has been suggested that the rationalisation of the Central Scotland airport system should be achieved by constructing a completely new airport between Edinburgh and Glasgow. Very little support for a new airport was expressed during the consultations, and in the Government's view such a project, which would be extremely expensive, would represent an unjustifiable waste of existing assets. The potential role of the airstrip at Dundee was also examined, but in view of the improved road communications between Tayside and the existing airports, there is no case for expansion of the airstrip beyond the purely local role of a category D general aviation airport. The Government has no doubt, therefore, that the airport needs of Central Scotland should be met for the foreseeable future by the existing facilities at Edinburgh, Glasgow and Prestwick. Within existing policies, Prestwick handles the transatlantic traffic for the whole of Scotland; Glasgow caters for domestic and European services for the West of Scotland; and Edinburgh provides domestic and some European services for the East Coast. However, during the consultations there was some pressure for this division of traffic to be abandoned or modified, and specifically for some Prestwick traffic to be transferred to Glasgow and for Edinburgh, with its modern new facilities, to be allowed to develop more freely and to cater for a wider range of services. With regard to the latter, there is no doubt that in the past traffic at Edinburgh was depressed as a result of the badly aligned runway and the lack of adequate terminal facilities; traffic increased by 20 per cent in the first year of operations with the new runway. Moreover, the increasing importance of Edinburgh as the capital of Scotland and the industrial development on the eastern side of Scotland both suggest that the relative importance of Edinburgh is likely to increase.
138 The respective roles of Prestwick and Glasgow are closely related both to each other and also to Edinburgh. Although an extension of the runway at Glasgow and some other development would be necessary before the airport could handle all long haul traffic, either Glasgow or Prestwick is capable of handling the joint demand anticipated up to 1990. Savings for the airlines and the BAA, and perhaps a better service for Scotland, could be achieved by concentrating services at one or other airport. In this connection, Glasgow airport is better placed for the main centres of population, has already an extensive route network and handles nearly six times as many passengers as Prestwick. On the other hand, Prestwick would not require any extension of its runway, it has a superior weather record to Glasgow and aircraft noise presents less of a problem. At the present time Prestwick fulfils an important role as a diversion airport and as a base for test and training activities. However, if the bulk of its passenger and cargo services were transferred to Glasgow it is difficult to envisage a viable role for Prestwick and the expectation must be that the airport would close. The concentration of services at Glasgow or Prestwick and the ending of restrictions on the use by certain services of Edinburgh airport could in the long run increase air services and produce an overall benefit for Scotland as a whole. However, the closure of Glasgow airport or, perhaps more probably, Prestwick airport could involve wider considerations. The Government takes the view that this is an issue which the proposed Scottish Assembly would wish to examine. In view of this, and the need to study the effects of the new facilities at Edinburgh over an extended period, the Government has concluded that existing policies relating to the allocation of traffic among the three lowland airports should be maintained generally, but that some greater flexibility could be followed in the development of traffic at Edinburgh.
Northern Scotland
The discovery and exploitation of oil in the North Sea has transformed a number of the aerodromes in the Northern part of Scotland, in Orkney and in Shetland, and especially Aberdeen and Sumburgh both of which have experienced very fast rates of growth in recent years. Considerable development by both the CAA and the BAA, supported by the Government, has been necessary at a number of these aerodromes, and further investment will be required at some of them. Until 1975, Aberdeen was operated by the CAA but with a considerable growth of the airport, as a result of oil-related activities, responsibility for it was transferred to the BAA, with its wider experience of airport management and of operating large and expanding airports. A similar situation to that which led to a change in ownership at Aberdeen is now developing at Sumburgh and, to a lesser extent at Inverness and Kirkwall.
The consultation document said that the possibility of transferring responsibility for the 8 Highlands and Islands aerodromes from the CAA to the BAA was being examined. As these aerodromes are of major importance to the communities they serve and in a number of instances vital to the development of the oil industry, the Government wished to assess the need, particularly at those aerodromes used by the oil industry, for wider airport management experience and resources to handle the rapidly growing traffic; to plan and supervise the extensive additional investment required; and to exploit any revenue earning potential. The Government believed it was important also to establish the advantages in terms of the Government's devolution proposals to be derived from associating the Highlands and Islands aerodromes with the four major airports in Scotland as part of the largely autonomous Scottish Airports Division of the BAA. With some significant exceptions, Scottish opinion generally was opposed to any change in ownership of the Highlands and Islands aerodromes; partly because it was thought that the BAA would be insufficiently sensitive to local opinion, but primarily because it was considered that the change could lead to an increase in the cost of air travel in the area. The evidence available to the Government does not suggest that either of these fears is justified. However, given the proposals in the Scotland Bill for the devolution of responsibility for aerodromes, it considers that it is preferable to leave the future ownership and management of the aerodromes for decision by the devolved administration. The Government has concluded therefore that, for the present, the Highlands and Islands aerodromes (with one exception) should remain the responsibility of the CAA.
In the case of Sumburgh which is now in a similar position to that reached earlier at Aberdeen, the Government has concluded that the management problems involved in the handling of the sharp growth of oil industry traffic, in controlling investment at the aerodrome, and in developing the aerodrome's facilities are such that a decision should not be further delayed. Accordingly, it has been decided that Sumburgh should be taken over by the BAA without delay. Expensive facilities have been provided for the oil industry, particularly at Sumburgh, and the Government considers that its traffic should pay a larger and fairer share of the cost of these facilities. The CAA and the BAA will therefore be requested to develop charging policies at the Highlands and Islands aerodromes which reflect this aim.
GENERAL AVIATION
The consultation document "Airport Strategy for Great Britain" was concerned essentially with airport facilities required to meet the demand for air transport movements. This is only part of civil aviation and the Government recognises that general aviation, and within that business aviation, is an important user and in some cases the major user, of airport facilities. In its consideration of general aviation facilities, the Government has been influenced by two main factors: that the accommodation of general aviation presents no problem in terms of the availability of aerodromes outside the South East of England and that its principal concern should be for business aviation which, in the facilities it requires has a close affinity to airline operations. Facilities for private and recreational flying are available throughout the country and, recognising always the need to take full account of the views of local communities, their use and development should continue to be primarily the concern of the local planning authorities.
As in the case of commercial aviation, the main problem facing business aviation is the availability of adequate airport facilities in the South East of England. The Civil Aviation Authority and the Standing Conference on London and South East Regional Planning have been studying this issue and thus have complemented the Government's consultations on airport strategy. They have produced two reports as the basis for consultations with those concerned and for their advice to the Government on aerodrome facilities for general aviation in the South East. In that advice the CAA and the Standing Conference concluded that the existing aerodromes should be able to accommodate the expected growth in general aviation if their facilities were improved and if business aviation were accorded some precedence. over recreational flying, particularly at a number of selected aerodromes.
147 The BAA recognises the importance of interlining to business aviation and it is the Authority's policy to allow provision for business aviation movements at Heathrow and Gatwick. However, with increasing congestion particularly at Heathrow in the peak hours the BAA considers that it should give priority to air transport movements, which utilise scarce resources to the benefit of the greatest number of air passengers and freight. The Government supports the BAA in this policy, but it recognises as a result the need for alternative accommodation for business aviation in the South East, in particular at locations readily accessible to Central London, to industry on the outskirts of London and to scheduled international air services. Following the advice of the CAA and the Standing Conference, based on their studies and the consultations they have undertaken, the Government considers that the airports at Biggin Hill, Leavesden, Luton, Northolt, Southend and Stansted could satisfactorily fill that role.
148 Luton, Southend and Stansted are fully developed commercial airports with the ability to handle all types of business aviation including executive jets. But none of them fulfils the requirement for a business aviation airport close to London and to Heathrow and Gatwick. The CAA identified Biggin Hill and Northolt as meeting this last and most important requirement. Northolt, which is only 5 miles from Heathrow, is owned by the Ministry of Defence and while the Ministry is willing to continue to make the aerodrome available for civil operations, there are environmental and operational constraints, relating to the runway and its proximity to Heathrow which limit the type and number of movements by civil aircraft at Northolt.
In view of the limited extent to which further civil use of Northolt is possible, the CAA and Standing Conference concluded that to accommodate demand from the North and West of London greater use might be made of Leavesden for non-jet business aviation. Leavesden airport which is 25 miles from London and close to the M1 and M25 is owned by the Ministry of Defence and is at present on lease to Rolls Royce Ltd. Their lease expires in June 1978 and discussions are currently being held to decide future arrangements.
In the light of the limited additional use that can be made of Northolt and Leavesden, especially by executive jets, the Government believes that the future use of Biggin Hill is of particular importance. Biggin Hill, which is owned by the London Borough of Bromley, is 15 miles from central London and within 40 minutes of Gatwick and 70 minutes of Heathrow by road. The Government proposes, therefore, to open discussions with the Borough Council and others concerned with a view to establishing Biggin Hill as a major business aviation airport for the London area. Improvements in its facilities would be required and in this role it would become an integral part of the London airports system. In these circumstances the Borough Council may favour a transfer of ownership to the BAA. Flying clubs now at the aerodrome may need to be relocated since these may not be compatible with an extended role for Biggin Hill as a business aviation aerodrome.
A final but important aspect of general aviation is helicopter operations. The Government recognises the need for and the advantages of a heliport terminal in London, which might be operated by the BAA. The Government is anxious that helicopter services to the capital should continue and it will maintain close contact with the operators of such services and the local authorities who lay down the conditions for the use of heliports, both on future developments and the environmental implications of such operations. SUMMARY AND CONCLUSIONS
DEVELOPMENT OF A NATIONAL AIRPORTS SYSTEM
152 The strategy for a national airports policy outlined in this White Paper is based on the recognition that the air transport industry through the provision of speedy and convenient travel makes a valuable contribution to the economy; the principle that air transport facilities should not in general be subsidised by the taxpayer or ratepayer; the need to take careful account of the environmental impact of airport developments; the more effective use of existing airport and other infrastructure resources; the adoption of a flexible approach in planning and development which can be related to the growth in demand; and the importance of consulting those concerned with airports in the development of policy.
153 In the South East, additional capacity is necessary in the 1980s to meet the forecast demand for air travel; in other areas there are underused and loss-making airports. The Government's objective is to achieve a greater use of airports outside the South East, but the diversion of passengers with origins and destinations in the South East to airports in other parts of the country neither makes sense in transport terms nor would it lead to an overall decrease in the numbers of people affected by aircraft noise. The limited scope for diverting passengers from the London airports to those in other regions does not therefore remove the demand for additional airport capacity in the South East of England. However, in the light of uncertainties both in the scale and geographical pattern of demand and the continuing requirement for restraint in public expenditure, there is a need for particular caution in the consideration of projects involving the commitment of vast public resources.
In present circumstances clearly foreseeable demands in the London area should be met by bringing forward proposals for the limited expansion of the existing airports. Outside the London area, air services should be encouraged to concentrate at a few selected regional airports which might thereby be able to offer a range and frequency of service to meet local demand and at the same time provide a stimulus to air travel outside the South East of England.
THE DEMAND FOR AIR TRANSPORT
In 1976 44 million passengers used airports in Great Britain and 31 million of these passed through the four London airports of Heathrow, Gatwick, Stansted and Luton. It is forecast that in 1990 the number of passengers at all airports in Great Britain will be between 86 and 117 million and at the London airports between 66 and 89 million. Two-thirds of the forecast increase is attributed to the growth of leisure traffic. Forecasting over so long a period involves considerable uncertainties, but the continuing rapid growth of leisure traffic in the London area is subject to particular uncertainty, since it involves the ability of London to accommodate ever increasing numbers of tourists, the extent to which foreign tourism can be attracted to areas away from London, and the way in which the domestic demand for leisure flights will develop in the regions where demand has hitherto lagged far behind that in the South East.
The forecasts suggest continued growth after 1990, but the prospects for the 1990s and beyond are a matter of even greater uncertainty. The Government has concluded that:
(1) the present forecasts represent the best available guide for the period up to 1990 but, in view of the uncertainties, it has decided to monitor the present forecasts and keep the assumptions and methodology under review, with a view to the preparation of forecasts for the late 1990s and beyond.
THE LONDON AREA
On the basis of the latest air traffic forecasts the Government has reached or confirmed the following conclusions on the handling of demand in the South East up to 1990.
(2) There is no requirement for or possibility of a new airport and the decision to abandon the Naplin airport project is reaffirmed.
(3) The BAA proposals for a fourth terminal at Heathrow airport to raise the capacity to 38 million passengers a year should be examined at a public inquiry.
(4) Proposals should be brought forward by the BAA for a second terminal at Gatwick airport to raise the capacity to 25 million passengers a year.
(5) Proposals should be brought forward by the BAA to extend capacity at Stansted Airport to handle 4 million passengers a year.
(6) Capacity at Luton Airport should be restricted to cater for 5 million passengers a year.
The four airports together would thus provide a total capacity for the London area of about 72 million passengers. Given the particular uncertainties about the higher end of the range of air traffic forecasts, and the need to avoid the premature and perhaps unnecessary commitment of costly and high risk new airport developments, the Government regards these proposed developments as sufficient for accommodating air traffic. in the London area during the 1980s. The proposed developments at (4) (5) and (6) will, like that at (3) be subject to the necessary planning procedures and these, together with the way in which demand for air travel develops, will be relevant to the order and timing of the various projects. There should be no further expansion of the London airports in the current phase of airport strategy.
In the longer term additional capacity will almost certainly be required in the London area. However, the Government accepts that limits should be placed on the growth of existing airports and has concluded that:
(7) Heathrow's ultimate development would be limited to not more than four terminals;
(8) the proposal for a second runway at Gatwick should not be revived, which effectively limits development at Gatwick to a two terminal airport;
(9) Luton airport is not suitable for development as a major airport to accommodate more than the 5 million passengers envisaged in conclusion (6).
With a continuing increase in the use of larger aircraft and improvements in air traffic control, any longer term provision for the London area should not involve the construction of a four runway airport as envisaged in the earlier Stansted and Roskill proposals. In the light of this, the Government will consider how additional capacity beyond 1990 can be provided. This will include
(10) (a) a major expansion of Stansted; or
(b) the development of an existing military airfield as a civil airport; or
(c) the construction of a new airport.
THE REST OF ENGLAND AND WALES
Outside the South East it is not envisaged that any new airports whether for passenger or cargo traffic will be required. The Government believes that efforts to achieve a greater use of airports outside the South East will be assisted by the development of a coherent airports policy which seeks some rationalisation of the existing pattern of airports and identifies a limited range of airports at which passenger services might be concentrated. In addition, the Government considers that it should be possible to achieve a greater use of airports outside the South East by charter and leisure services catering for British holiday makers travelling overseas and by incoming tourist traffic.
162 The Government has reached the following conclusions relevant to the development of regional airports in England and Wales.
(11) There is no requirement for a new airport outside the South East of England and with the preponderance of cargo carried on passenger aircraft an all cargo airport would not be viable.
(12) Manchester International airport, which is within an Assisted Area, is well located to serve important centres of population and industry and has adequate facilities to meet expected demand until at least 1990. It should consolidate its position as a gateway international airport and as the principal airport outside the South East of England.
(13) There is no requirement for a second gateway airport, but elsewhere in Central England, Birmingham and East Midlands airports, as category B airports, should fulfil important roles in serving the requirements of the Midlands for short and medium range scheduled and charter services. Leeds/Bradford airport should fulfil a similar, though less extensive role, in the smaller catchment area of Yorkshire and Humberside. In the longer term, depending on the development of demand, East Midlands airport may assume a wider role in the national airports system.
(14) In Northern England demand is likely to remain insufficient to justify a gateway international airport. Newcastle airport, as the main regional category B airport for the region, should continue to maintain its existing advantage over Tees-side airport in terms of the amount of traffic and the range of services, but the location of Tees-side airport is such that it can be expected to have a continuing role as a category C airport.
(15) In South Wales and South West England the catchment areas of the various airports are small. Glamorgan airport, with its modern but under utilised facilities, should develop as the category B airport in this area.
(16) Apart from the airports considered in conclusions (12) to (15), no other airport in England and Wales is expected to fulfil a significant role within a national strategy, though a number of these other airports can be expected to continue to cater for local needs as either category C or D airports.
SCOTLAND
163 The Scottish airports can be considered separately, but their future cannot be divorced from decisions on devolution. The four principal airports in Scotland are owned by the British Airports Authority and over the last five years virtually a new airport has been built at Edinburgh, extensive new facilities have been provided at Aberdeen, while Glasgow and Prestwick are well equipped to meet the traffic demand. The Government has concluded that:
(17) there is no requirement for a new airport in Central Scotland;
(18) generally any modification in the roles of the three lowland airports at Prestwick, Glasgow and Edinburgh should be a matter for the proposed Scottish Assembly;
(19) Sumburgh aerodrome should be acquired by the BAA from the CAA;
(19A) the future arrangements for the remaining Highlands and Islands aerodromes should be decided by the Scottish Assembly;
(20) charging policies at the Highlands and Islands aerodromes should be developed to provide that oil related traffic at these aerodromes is not subsidised by the taxpayer. GENERAL AVIATION
164. General aviation, which includes all flying other than the operations of major airlines, is an important user of airport facilities. Adequate provision for private and recreational flying is generally available throughout the country, but business aviation which sometimes requires the runway and navigational facilities of a major airport places an additional demand on the capacity of airports in the South East of England. The Government believes that the requirements of business aviation in the South East call for specific recognition and it has concluded that:
(21) the airports at Biggin Hill, Leavesden, Luton, Northolt, Southend and Stansted should meet the demand;
(22) discussions should take place with the London Borough of Bromley and others concerned with a view to establishing Biggin Hill as the major general aviation airport for the London area and to its possible acquisition by the British Airports Authority;
(23) adequate helicopter facilities should be provided possibly by the British Airports Authority, to meet demand for helicopter services to and from central London. IMPLEMENTATION OF THE STRATEGY
165 The Government will take account of airports policy in issuing permits for scheduled and charter services by overseas operators. With regard to British operators, and similarly, the Civil Aviation Authority in considering applications for new services and the renewal of existing licences will be expected to take account of airports strategy in accordance with the policy guidance which has been given to the Authority.
166 Losses at local authority airports in England and Wales are currently running at £5-6 million a year. While the subsidies for air transport in the Highlands and Islands are a particular exception, there can be no general justification for subsidising airports and air services. At the local airports which will remain under local authority control there will be a continuing need for economies and the application of policies aimed at reducing financial losses as effectively as possible.
167 The Government will consider any proposals put forward by local authorities and the BAA for the transfer of the ownership of airports in the light of the policy outlined in this White Paper. ACCESS
168 Adequate access to airports is an essential requirement and this will be among the factors taken into account by the Departments concerned with road building programmes. Where improvements to local roads may be thought desirable to accommodate increased traffic due to airport expansion, it must be for the local authorities concerned to assess their priorities and make any appropriate provision in their annual local transport programmes, on the basis of whose assessment Transport Supplementary Grants in England and Wales are distributed. In the Government's view, it is desirable to make the best use of public transport, especially the important underground and rail connections available at Heathrow, Gatwick and Birmingham. There will be a continuing need for airport authorities and those responsible for operating public transport services to work closely together.
AIRCRAFT NOISE
169 Disturbance caused by aircraft noise is the most serious problem associated with air transport operations. Over the next 15 years there should be a marked decline in the number of people adversely affected by aircraft noise. However, the Government will continue to develop policies to reduce the impact of this nuisance and to seek international agreement on more stringent noise standards for aircraft. In pursuit of these objectives the Government has decided;
(24) to continue its efforts to find an alternative (30) to fund a programme of research into the relationship between aircraft noise and sleep disturbance;
(31) to reaffirm and clarify the advice to local authorities that new housing developments should not be permitted in areas close to major airports seriously affected by aircraft noise.
PLANNING
In view of the uncertainty relating to the forecasts and the constraints on public expenditure, the Government believes that a step by step approach to airport developments is sensible. Nevertheless, it recognises the concern that was expressed in the course of the consultations that the expansion of existing major airports could continue almost indefinitely, leading to an erosion of the environment and to difficulties for the local authorities responsible for planning the areas affected. Accordingly, the Government has decided:
(32) that limits should be placed on the development of some airports when circumstances make this appropriate and that these should be defined in terms of the number and size of terminals to be built;
(33) to discuss with the BAA, and the local authority method of measuring noise disturbance, which can be fully evaluated and which is generally acceptable;
(25) to prohibit the use of non-noise certificated subsonic jet aircraft acquired by any United Kingdom operator after 30 September 1978 and to prohibit from 1 January 1986, the use of all non-noise certificated subsonic jet aircraft on the United Kingdom register;
(26) to continue to seek agreement within the European Civil Aviation Conference on further measures to promote the development and use of aircraft incorporating the latest advances in noise abatement technology;
(27) to seek powers to ensure that airport authorities can discriminate between noisy and quieter aircraft in their charging policies;
(28) to continue the use of runway alternation at Heathrow and to maintain and stabilise the general policy of minimum noise routes;
(29) to phase out flights by the noisier aircraft at night at Heathrow, Gatwick and Stansted and to indicate to the Luton Borough Council that the Government would expect a similar policy to be applied at Luton airport; CONSULTATION
171 The Government considers that the consultations on airports strategy have made a valuable contribution to the development of airports policy and the decisions contained in this White Paper.
(34) The Government will continue to consult those concerned with airport development including consumers of air services and amenity groups. In view of the particular interests of the local planning authorities an appropriate formal structure will be discussed with local authority associations to ensure that their interests are taken into account in the formulation of advice on the longer term airport options. CABINET
FUTURE PAY POLICY
Memorandum by the Chancellor of the Exchequer and the Secretary of State for Employment
1. When Cabinet discussed on 22 December the outlook for pay negotiations in the remainder of the current round we were invited to put forward a paper on possible approaches to longer-term policy, including institutional possibilities (CM(77) 41st Conclusions).
2. The policies in each of the past three years were presented as temporary expedients to meet the particular circumstances of the time. Their success in meeting their limited objectives - assuming the present round holds as well as it has done so far - along with our other economic measures enables us now to reconsider our longer-term aims with regard to pay, where we want to get to over the next few years and how we might get there, although in the event we may have to settle for an agreement for one year on which we could build later.
3. In this paper we examine the options, starting from the practical position we expect to be in at the end of the current round in July of this year.
THE CONTEXT FOR THE DEVELOPMENT OF LONGER-TERM POLICY
4. As we approach the end of the current round the economic position is likely to be radically different from that of a year earlier. With sterling secure, commodity prices reasonably stable and the benefit of last year's pay restraint feeding through into prices, the year-on-year Retail Price Index should have fallen dramatically, perhaps showing signs of levelling out around 8 per cent. Average earnings will have edged up somewhat over 10 per cent and, depending partly on the extent of self-financing productivity deals, perhaps nearer to 15 per cent. Taking account of the Budgetary measures of last November, those already promised for April and the likely scope for further action then, real standards net of tax will for most people be substantially higher than a year earlier.
5. On the other hand unemployment is likely to be still around 1½ million. Some commentators will be predicting, particularly if earnings are at the higher end of the expected range, a resurgence of price inflation into double figures within the following 12 months. Negotiators, unless persuaded otherwise, might seek not only to insure against this but also to secure in their settlements, ignoring tax benefits, a due share of the real improvement that the more buoyant state of the economy would appear to justify. Many employees, moreover, may be less conscious of their real gains in absolute terms than of their relative losses through compression of differentials, outstanding anomalies and relativity claims, frustrated plans for restructuring etc about which nothing could be done for two years under the £6 and 5 per cent policies and less than we originally hoped in the present round. Many might well be unwilling to wait until normal annual settlement dates to rectify these.
THE BASIC OBJECTIVES: INCREASED EMPLOYMENT AND HIGHER REAL LIVING STANDARDS, REQUIRING MODERATE PAY SETTLEMENTS
6. In this situation the Government must clearly emphasise as the objective over the next two or three years and beyond a significant increase in the level of employment as well as improvement in the real living standards of those in work, of pensioners and of the community generally.
7. A sluggish recovery in world activity and underlying structural changes in the industrial economies would make more ambitious manpower policies necessary and may also make it necessary to continue short-term employment measures longer than we believed. But on whatever hypothesis we have the necessity of improving our relatively low levels of productivity in many areas and this in turn has much to do with improving investment as with improving working practices and management. But that takes time. Meanwhile it will only make our competitive position worse if money increases in pay substantially exceed the increase in production actually achieved; and the effect of this on confidence will tend to discourage investment, so compounding the problem.
8. Since the increase in productivity is unlikely to be sustained at more than 2 or 3 per cent per annum over the next few years, this points to a desirable level of settlements of around 5 per cent.
THE FIRST OPTION FOR PAY: FREE COLLECTIVE BARGAINING
09. We have presented our policies since July 1975 as temporary interruptions in the otherwise natural order of things (though we made clear from the start it would be a matter of years before it could be fully restored). The Trades Union Congress (TUC) last September called by an overwhelming majority for an orderly return to free collective bargaining in the current round, as each group came to its due date under the 12 month rule.
10. There is a theoretical argument that only free collective bargaining can determine the just level for pay in a market economy. Perhaps more cogently, many of those with practical experience of pay negotiations - whether trade unionists, employers or independent third parties - argue that only free collective bargaining can sort out the enormous variety of practical problems of adjustment of pay structures that inevitably arise from time to time, quite apart from the effects of the rough justice of an inflexible pay policy.
11. Yet to leave pay determination to the vagaries of the market place with no guidance whatever carries great risks in our economy. It is difficult to see how one can - for any length of time - have the advantages of free collective bargaining if one is not prepared to accept the market consequences in terms of inflation and unemployment, when bad bargains are struck. There will always be a risk of a high going rate of settlement getting established by bad bargains, because of leapfrogging and ratchet effects. For 1978-79 this risk could be high, given the level of expectations described in paragraph 5 above. Moreover there is a growing recognition inside the trade union movement itself that unless some framework is established which determines the scope for collective bargaining it will be difficult to meet the needs of social justice or the nation's economy.
SPECIAL PROBLEMS OF THE PUBLIC SECTOR
12. Free collective bargaining raises particular problems in the public sector. Traditionally these problems have been met by some form of comparison with the levels of pay, or amounts of increase, negotiated in the private sector (eg Pay Research Unit, the Wilberforce settlement for miners and more recently the forward commitment for firemen).
13. There are, however, a number of difficulties in operating such a system within a general policy of totally free collective bargaining. First, any system based on "catch-up" has an element of delay. Thus when the level of pay increase in the private sector is escalating, the public sector are apparently condemned to trailing behind; when it is de-escalating, increases in the public services will still be reflecting the earlier, higher increases in the private sector, which may then attempt to recover the "lost" ground. In 1978-79, in particular, such an approach could mean settlements for groups settling early in the round, such as local authority manuals, of up to 15 per cent at a time when as indicated above the Government would be looking to the private sector for settlements well within single figures. Secondly, no index linking or other system of comparisons can entirely replace bargaining in the public services to meet changes over time in the nature of the work or a local situation. The private sector comparisons will therefore tend to set a floor with additional increases for some groups on top. Thirdly, public sector pay tends to be fixed by reference to average pay levels elsewhere. Because public service pay levels are nationwide, and because they attract widespread publicity, they appear to be setting the pace for all private sector groups paid below average. Yet if these groups move up, those paid above the average are likely to seek corresponding increases to maintain their differentials. All three of these factors tend to create a situation in which, even under a system of factual comparisons, public sector pay is often seen to be setting the pace and fuelling inflation.
14. The ideas recently put forward by Mr Basnett, General Secretary, General and Municipal Workers Union, presented as they are in the context of free collective bargaining, are open to these objections. But his initiative is an interesting one. It could be well worth pursuing on the basis of some view as to the general level of settlements that should prevail in each current round. But to avoid unfair discrimination against the public services there would also have to be an indication which applied to negotiations in the private sector. This forms the basis of the second main option.
THE SECOND OPTION FOR PAY: AN INDICATIVE POLICY
15. The essential characteristic of an indicative policy is some central guidance as to the generally desirable level of pay settlements and the interval between them; indications might also be given of any general grounds for higher increases (eg productivity or low pay); some arrangements would be needed for identifying groups with wholly exceptional claims. It is in effect free collective bargaining within voluntarily accepted constraints consistent with enlightened self-interest.
16. The West German system of "concerted action" is, of course, essentially of this kind. Its effectiveness is enormously dependent on the economic circumstances in which it is introduced and operated, as illustrated by experience in the United Kingdom with somewhat similar arrangements. It is now advocated by the Confederation of British Industry (CBI). But it clearly could not work without the positive support of the TUC (and at least the acquiescence of all the major unions). If this could be achieved - and we think it is possible in the longer term if not immediately - this would in our view probably be the most attractive of all the options open to us.
17. It might help to get such a policy established if the timing of some of the major negotiations could be synchronised near to the beginning of the round, so enabling an acceptable "going rate" to be established early on and minimise the risk of leapfrogging. We understand that something of this kind operates through two major settlements in West Germany. The essential point, however, is that negotiations should be synchronised; merely to bring settlement dates closer together in breach of the 12 month rule might be costly and insufficient. This could be an idea worth exploring with the TUC generally, and perhaps particularly with public sector representatives. INSTITUTIONAL POSSIBILITIES
18. Such a policy would probably require the evolution of various institutional changes. The indicative statement might conceivably take the form of a joint Government/TUC initiative accepted by the CBI (as in 1974-75 but in more favourable circumstances). Or it might be a Government policy endorsed by the TUC and the CBI. Or it might emerge from some tripartite body, possibly the National Economic Development Council but more likely an ad hoc grouping initially from which some new institution might develop.
19. There is bound to be considerable difficulty in dealing with exceptional cases. There is a problem of finding or establishing an institution whose judgments as to the exceptional nature of such claims would command sufficient acceptance to persuade others to remain content with the lower general level of increase. It might help if the function were split between purely fact-finding (by a body on the lines of the Civil Service Pay Research Unit or the Office of Manpower Economics which services the existing Review Bodies) and adjudication (which might be undertaken by a tripartite or even wholly TUC body). There is also a problem of case load but there might be scope for some of the minor cases to be dealt with, along more defined lines, by the Central Arbitration Committee of the Advisory Conciliation and Arbitration Service which already has somewhat similar functions under Schedule 11 of the Employment Protection Act and its general arbitration role. The chances of such arrangements proving effective are again dependent on the extent to which the TUC would co-operate.
20. The question inevitably arises, however, as to what to do if we cannot immediately get a sufficient degree of TUC support to make a purely indicative policy a viable option, or if, having embarked upon such a policy, it is openly flouted by some significant group or section of the community, for example when salaries are individually negotiated or in small firms. For this reason we also need to consider, as a third option, how such a policy might be sustained - at least to begin with - by other means.
THE THIRD OPTION FOR PAY: A POLICY BACKED BY DISCRETIONARY POWERS
21. This has much in common with the second option, but requires means to enforce the policy. It is hard to envisage the successful continuation of such a policy beyond the current round without at least the tacit acquiescence of the TUC (sufficient to effectively deny support to any individual union taking industrial action against the policy), though such acquiescence might have to emerge as the policy progressed rather than be stated in advance.
22. Apart from this obvious difficulty a problem with this option is that the present kind of discretionary powers can only be applied where the policy requirements are reasonably clear-cut. This makes it difficult to provide adequate flexibility with the general terms of the policy, and would put considerably greater pressure on the mechanism for dealing with exceptional cases. This option cannot be regarded as a stable long-term arrangement but might provide a means of transition to option 2.
THE NEXT STEPS
23. The conclusion of this analysis is that we should seek an indicative policy - the second option. But the prospects depend heavily on the extent and form of TUC co-operation. The best chance of securing such co-operation is to include this subject in discussions with the TUC about the whole range of our economic and social policies. The next steps must be to explore these matters with the TUC. The CBI can be brought in later. The agenda for this part of the discussions with the TUC might progress along the following lines:
a. Assessment of forward economic position, and examination of TUC ideas as set out in their forthcoming "Economic Review".
b. Assessment of implications of a free-for-all.
c. Issues such as the 12 month rule, which might not prove too difficult to negotiate.
d. Approaches to the public sector problem and to the problems of low pay and differentials.
e. Can we reach any understanding on the handling of special cases?
f. Can we get a consensus on the general level of settlement and how do we set about it, particularly as regards timing?
24. Time is short since some indication of the way things might go will be needed by the time of the Budget, and in order to start influencing negotiators' expectations before the commencement of the union conference season which immediately follows and runs through to July.
CONCLUSION
25. We invite our colleagues' views on these somewhat tentative ideas. It might perhaps be helpful to order our discussion round the suggested agenda for talks with the TUC and CBI listed in paragraph 23 above.
Treasury Chambers 23 January 1978
D W H A B 24 January 1978
CABINET
SPECIAL EMPLOYMENT MEASURES 1978-79
Memorandum by the Secretary of State for Employment
1. The employment prospect this year is gloomy and the labour force is growing - by 170,000 a year. I hope there will be scope for considerable reflation this year, but this takes time to produce jobs and would not make any dramatic impact on unemployment this year. I have therefore proposed an expansion of our special employment measures which would keep another 110,000 people off the unemployment register - raising the total impact to around 360,000. This would be achieved by continuing the Temporary Employment Subsidy (TES) and by expanding the Small Firms Employment Subsidy (SFES) and the Job Release Scheme (JRS). These measures would make their full impact over the coming year and are about ten times more cost effective in reducing unemployment than general reflation.
2. I should have liked to propose action wholly to offset the expected 170,000 increase in the labour force this year, but other measures we have looked at to do this are not as cost effective.
3. The Ministerial Group on Unemployment Among Young People (GEN 27) agrees broadly on the need for an increased impact on the register and on the scale of assistance, but has not yet decided whether this should be achieved by the measures I propose or by other means. Measures agreed by the Group to date would take only a further 35,000 off the unemployment register. This is too small, particularly when we may have to take a cut in TES.
4. The difference within GEN 27 boils down to the extent of the expansion proposed in the SFES and the JRS. On SFES, we are agreed that it should be open to firms with up to 200 employees, but a majority of GEN 27 wish to confine it to assisted areas and inner city areas whereas I wish to see it extended nationally, with a higher subsidy of £25 being paid in development areas and inner city partnerships.
5. On JRS, my colleagues agree that it should be extended nationally, but I wish also to open it to workers within two years (instead of one year) of retirement and to raise the tax free allowance from £26.50 to £40, which research has shown would be a cost effective way of increasing the impact. JRS is our only instrument acting on the labour supply and a means of avoiding unfavourable pressures for early retirement.
6. The gross annual cost of the package I propose would be £496 million (assuming no cuts in TES) but the net annual cost and effect in the Public Sector Borrowing Requirement (PSBR) would be only £118 million. There would be net staff savings because of reductions in the unemployment benefit service.
7. Even on this basis, it would be desirable to review the situation during the summer to see whether more could usefully be done, particularly on training for the unemployed.
TES AND THE EUROPEAN ECONOMIC COMMUNITY (EEC)
08. If we want to continue the TES after 31 March 1978, we have to notify the EEC Commission by 31 January 1978 of the form in which we propose to operate the Scheme. The two months' notice is needed for the Commission to consult other Member States and to make up its own mind finally about our proposals.
09. There are 180,000 subsidies in payment under the TES of which 105,000 are in textiles, clothing and footwear. (There are additionally some applications in the pipeline). The Commission have intimated to us formally that they want changes in the Scheme which would reduce the number of textile etc. subsidies in payment by around 85,000. In informal discussion Commission officials have indicated that the Commission might be prepared at the end of the day to settle for a reduction of 50,000 in the number of textile etc. subsidies. We have offered no more than basically procedural changes in the Scheme ie no reduction in numbers.
10. When the matter was discussed by GEN 27 I was asked to make further enquiries in Brussels and elsewhere and I will report orally to the Cabinet on the result of these. However, I do not expect any important change in the situation I have described.
11. Other countries operate employment subsidies of various kinds and in Belgium and the Netherlands there are schemes specifically directed to the textiles/clothing sectors. The Commission claim to judge each scheme on its merits. In response to an enquiry from the Prime Minister there is to the best of our knowledge, no significant scheme of aid in France directed specifically to the textile industry.
12. Clearly it would be easier for us to make a concession on textiles etc if we could replace the TES for the three industries in question by an alternative scheme acceptable to the Commission. We have looked at the possibility in conjunction with the Department of Industry and one possibility has emerged. I might be able to devise a special scheme of support for short time working in these industries. Such a scheme might replace TES wholly or in part in the three industries, though its effect would fall somewhat short of TES in terms of jobs saved. I am making detailed proposals to GEN 27. If they commended themselves they could be introduced from, say, 1 July 1978.
13. I propose to the Cabinet that we should notify the Commission as required by 31 January that we are looking at alternative schemes to replace the TES wholly or partly in the textiles, clothing and footwear sectors; that meanwhile we propose to extend the TES to 30 June (subject to some small changes, including prior notification of important applications); and that we will by 30 April present fresh proposals to them designed to meet their concern by reducing the dependence of textiles, clothing and footwear on the TES.
TIMING OF ANNOUNCEMENT
14. There is much to be said for making a general statement of our intentions at the end of January before we notify our proposals for TES to the EEC. (We have also to notify our intention of extending the SFES). This would remove uncertainty about the future of the schemes, would precede any leaks from Brussels and could be useful when the National Economic Development Council discuss the employment implications of the industrial strategy on 1 February. I attach a draft of such a statement. This would be followed with an announcement in mid-March of the detailed basis on which these schemes would proceed.
RECOMMENDATIONS
15. I recommend that:-
a. We should aim to build up the impact of the measures towards 360,000 in 1978-79 by extending JRS and SFES to the whole country, with JRS open to those within two years of pension age and with a tax-free allowance of £40 and SFES open to manufacturing firms with up to 200 employees.
b. We should notify our intentions regarding TES to the EEC as proposed in paragraph 13. c. We should make the attached statement of our intentions before the end of the month, followed by a more detailed statement around mid-March.
A B
Department of Employment
23 January 1978 DRAFT STATEMENT
We have already announced that the new Youth Opportunities Programme to help 16-18 year olds and the Special Temporary Employment Programme for adults will be operating throughout 1978-79 and that there will be a final round of special training measures for this year before the Manpower Services Commission's new training in skills programme comes into operation.
The other special employment measures - the Temporary Employment Subsidy, the Small Firms Employment Subsidy and the Job Release Scheme - reach their closing date for applications on 31 March 1978. We have decided that these schemes will be extended in a broadly similar form for a further year from 1 April 1978 until 31 March 1979. We intend to continue the Temporary Employment Subsidy and to enlarge the coverage and impact of the Small Firms Employment Subsidy and Job Release Scheme. We shall be discussing our proposals for the Temporary Employment Subsidy and the Small Firms Employment Subsidy with the EEC Commission and I will make a further statement on the detailed basis on which these schemes will operate in 1978-79 in due course.
The special measures are currently assisting some 330,000 workers and are estimated to be reducing the unemployment register by 250,000. The extensions of the measures I am announcing today along with the development of the other schemes already announced will increase very substantially over the coming year the impact on unemployment. CABINET
BENEFITS OF NORTH SEA OIL
Note by the Secretary of the Cabinet
1. Following the discussion on 15 December (CM(77) 40th Conclusions, Minute 5) I was instructed to prepare a draft White Paper for consideration by the Cabinet.
2. I attach this draft herewith. It also incorporates a number of amendments made by the No. 10 Policy Unit.
Signed JOHN HUNT
Cabinet Office
23 January 1978 INTRODUCTION
01. North Sea oil provides a unique opportunity for Britain to improve her economic performance, raise her living standards, move forward to full employment, and develop a socially just free and fair society.
02. For too long Britain had a weak balance of payments, slow productivity growth and low investment. As a result, our living standards, which were among the highest in Western Europe, are now among the lowest. Governments have tried repeatedly without success to alter these trends. Change will not be easy now, but we shall never have a better chance.
03. The prolonged world recession focussed attention very sharply on our problems. Following the fivefold rise in oil prices, and the heavy additional cost of importing oil, Britain borrowed heavily abroad to finance the balance of payments deficit. In addition we suffered disruptingly rapid inflation. The recession has highlighted the uncompetitiveness of some of our major industries, which have required substantial Government assistance. Plans for increased social expenditure had to be scaled down.
04. Nevertheless in the past year the country's position has substantially improved. We are no longer borrowing abroad: and we are beginning to repay debt. The rate of inflation has been dramatically reduced - thanks largely to the co-operation of the trades union movement in a voluntary incomes policy. Unemployment is still unacceptably high, but the Government has taken action to contain it, and is now in a position where it should be able to take further measures positively to reduce it.
05. The next task is to build on this stability to move back to growth in production and employment.
06. Here it is that North Sea oil gives us a great opportunity. Sensibly used in line with the policies laid out in this White Paper, it can enable us to rebuild the industrial strength of the nation, to the benefit not only of this generation, but of our children and our grandchildren.
07. But it also presents us with a challenge. North Sea oil is not a panacea; and as a nation we have to decide how best to use the benefits it brings. It would be all too easy for Governments to use the extra revenue simply to finance faster growth in living standards through tax reductions and increased social benefits to an extent which would leave insufficient room for increased productive investment. But rapidly expanding living standards, with no direct provision for stimulating investment, would entail balance of payments risks and would be unlikely to be sustainable in the longer-term; we would have done little to develop new sources of energy to replace declining output of North Sea oil; and we could well find, as the oil starts to run out, that nothing had happened to improve our general economic performance. The Government believes that it would be wrong to fritter away the benefits of North Sea oil in this way.
08. North Sea oil is one element in what must be a continuing and long-term programme for national recovery. A Labour Government of the 1980s will place industrial regeneration, and the rapid return to full employment, at the heart of such a programme. Part of the revenues flowing from North Sea oil will be channelled directly into industrial development by way of direct help and through the National Enterprise Board, and the Scottish and Welsh Development Agencies. High priority will be given to investment in new energy sources, and in energy conservation. The Government will introduce a more effective, and more generous, structure of private sector investment incentives, both national and regional.
09. Sustained economic expansion will not be possible if the Government's investment strategy fails. Equally, however, we recognise that no programme designed to stimulate investment can succeed unless the macro-economic background is conducive to industrial expansion. The Government will therefore use part of the benefits of North Sea oil to reduce taxation on the private sector, and to undertake a programme of selective improvements in the public services. Such an integrated programme should allow the economy to expand sufficiently rapidly in the 1980s to ensure a return to full employment.
10. In this White Paper, the Government sets before the British people its view of the likely size and duration of the oil revenues, and its priorities for making use of these revenues. The White Paper presents the Government's plan to use our oil to regenerate and reinvigorate our economy, and to lay the foundations for a Britain at once prosperous and socially just. The Government, through its general economic policies, can set the broad framework for such a strategy; and some of the major investment decisions - such as the development of alternative sources of energy - must, in the end, be the Government's. But what the Government can do by itself is strictly limited. If the strategy is to succeed, it will require the co-operation and effort of management, workers, and the British people as a whole. We seek the support of the whole nation in that task.
NORTH SEA OIL: A NEW DIMENSION?
11. In 1977, North Sea oil production was already equal to about half the United Kingdom's total consumption; and the balance of payments gained by some £2 billion. Without it, the turn-round of 1977 would have been more difficult, and would have taken longer.
12. We are thus already enjoying the first benefits of North Sea oil. By 1980, we expect to be producing as much as we can consume; and we can expect to be a net exporter of oil at least for some part of the 1980s. By the late 1980s production on present forecasts may begin to decline, and while production should continue at a substantial level for at least another 10 years, we may well become net oil importers again in the 1990s.
13. The benefits which North Sea oil will bring to the economy can be looked at in three ways. If the real price of oil remains unchanged, it can be expected:
a. to increase Gross National Product (GNP) by around £3½ billion in 1980, and by £5 billion in 1985 (at 1976 prices): this is a temporary boost to national resources equivalent to between 3 and 5 per cent of present GNP;
b. to provide a substantial new source of Government revenue: receipts will be small in 1978; but they will reach £1½ billion in 1979, and by the mid-1980s they should rise to at least £3½ billion (at 1976 prices): this is equivalent to about 7 per cent of present total Government revenue;
c. to improve the balance of payments by about £5 billion in 1980, rising to £7-8 billion in 1985: this is equivalent to about 7½ per cent of present visible and invisible imports. 14. Thus, North Sea oil can be expected to provide a relatively small addition to total national resources, a sizeable addition to Government revenue, and a major improvement in the balance of payments over the next decade. Thereafter, the benefits are likely to decline. Not only are the benefits of North Sea oil likely to be temporary. Their direct effects are largely to save foreign exchange and to increase Government revenue. Of themselves, they will do nothing to improve our economic and industrial performance.
GENERAL POLICIES
15. The Government's general policies will be designed to create the conditions in which its plans for the sensible use of North Sea revenues can best be achieved.
16. First, the Government needs to promote the expansion of economic demand and activity, and get the economy moving forward to full employment. This will be much easier to do if other major industrial countries take similar expansionary action; and the Government will continue - as it did in 1977 - to urge on other major countries the need for effective action to bring the world economy out of the present recession. But, even if the world economy does not recover rapidly, the United Kingdom can take advantage of its improving economic position to start expanding the economy through appropriate fiscal and monetary policies.
17. Second, it is important that, in the process of expansion, we maintain and improve the international competitiveness of our industries. Otherwise we shall lose export markets and suffer increasing import penetration. An absolute requirement for such an improvement in our competitiveness is to win the battle against inflation. Substantial progress has been made in this endeavour over the past 2 years, but the battle against price increases must be fought to victory. The gains from controlling inflation, and the threat which renewed inflation would pose for the rest of our objectives, are both so great that this must be an essential part of the Government's strategy.
18. Thirdly, industrial efficiency goes beyond price competitiveness. Therefore the Government intends - as it indicated in the White Paper on Industrial Strategy - to give industry first priority in the whole range of its policies. The wider implications of the industrial strategy for other policies are being examined, and the need for changes in direction or emphasis are being identified. Many of these will need time to take effect, but the Government proposes to implement them progressively and to persist with them.
19. We will need more and better investment (see below paragraphs 21 to 25), but investment, by itself, will not be enough: industrial relations in its widest sense will need to improve. The potential benefits of new machinery and more efficient techniques can only too easily be squandered if the whole-hearted co-operation of those involved is lacking. Continuity of production, realistic manning levels, prompt delivery and quality control - these are crucial in winning markets and improving production; unless we strengthen our manufacturing performance in these areas, no amount of investment will succeed. A new approach to industrial relations is therefore required; one which replaces attitudes of confrontation with democratic participation. In contemporary society, workers need to understand the problems which face the firm they work for and how they can share in decisions to improve its performance; for it is the progressive and competitive firm which offers its employees the best prospect of job security and rising real wages in the longer-term. For this reason, the Government will continue with its efforts to promote industrial democracy in both the private and public sectors.
THE USE OF NORTH SEA REVENUES TO ASSIST NATIONAL RECOVERY
20. Within the framework of general policy objectives set out above, the Government proposes to utilise the revenues from the North Sea in giving specific emphasis to a selection of policy areas which it believes are crucial to the recovery of the United Kingdom economy. Particular emphasis will be given to:
i. investment in industry;
ii. promotion of energy supply and conservation;
iii. reducing the burden of taxation;
iv. increasing public investment on social and economic infrastructure. After full consideration, the Government has decided that it is not in the national interest to use North Sea revenues on a programme of major debt repayment - designed, for example, to clear debt by any arbitrary date such as 1990. This would almost certainly entail running the economy at a level of demand which would be incompatible with either a return to full employment, or a major restructuring of British industry. The Government therefore intends to roll forward a portion of the United Kingdom's international indebtedness for eventual repayment in the 1990s or beyond.
It is now proposed to look at the four specific uses of North Sea revenues in more detail.
INVESTMENT IN INDUSTRY
21. Substantial increases in investment will be essential if the strategy is to succeed. Modernisation and much higher levels of productivity are needed in many firms and industries if they are to retain and improve their competitiveness. Some firms will be able to take on more labour; others will be producing more, but with a smaller work force. To raise productivity, and to create new jobs to absorb both the increase in the labour force and the workers moving out of declining sectors will require a quite different scale of industrial investment and expansion of industrial output than we have seen in the past 10 years.
22. Most investment decisions have to be taken by industry itself. At present, one reason why investment is low is because demand is low. Industry is uncertain whether new investment would earn an adequate return. If industry is to flourish it needs a stable environment. It also needs confidence in a steadily growing market for its products both at home and abroad. And it needs the prospect of a satisfactory return on its investment. The general economic climate is crucial. To some extent, this depends on international factors outside our control, but whatever other countries do, a general stimulus of the United Kingdom economy is a precondition for recovery. North Sea oil will ease the balance of payments constraints on expansion. We must use this greater freedom to pursue demand management policies which offer the prospect of steadier growth of demand, at higher levels than would otherwise have been possible. In the first stage of the recovery, such a stimulus will contribute directly to creating a stable and favourable climate for industrial expansion. As the recovery proceeds, the Government will need to ensure that resources which, on a longer-term view, should be devoted to industrial investment and infrastructure, are not pre-empted by unsustainable increases in consumption - private or public.
23. The experience of the past shows, however, that expanding demand alone is not enough to bring about a sufficient increase in investment. So in addition to helping to create this climate of confidence, the Government will need to be involved more directly. The North Sea revenues will enable it to provide an effective framework of general investment incentives, both national and regional. But over and above this there is the need for selective assistance and intervention which, properly used, will be more cost-effective than general assistance.
24. The tripartite industrial strategy points the way forward by steadily building up, sector by sector, a detailed picture of the opportunities ahead and the action needed to seize them. There are many areas where United Kingdom industry has strengths on which we can build. There are new products and processes to be developed and exploited. Industrial activities directly related to North Sea oil present one example with obvious attractions. The Government will do everything possible to further the industrial strategy through the Sector Working Parties and to encourage the firms and unions concerned to see that the conclusions of the Working Parties are translated into positive action in the board room and on the shop floor. Planning Agreements, like the industrial strategy at sectoral level, will provide a means of concerting action by Government and individual firms.
25. As an integral part of this strategy, the Government itself intends to invest in Britain's manufacturing future through the National Enterprise Board, both directly and in partnership with the private sector, and through the Scottish and Welsh Development Agencies. They will have an important part to play in expanding investment: particularly in projects which aim to modernise and expand industry in declining areas, to provide alternative job opportunities, and to improve the industrial infrastructure. In all this, the regional dimension will be taken fully into account. It will be a major aim of the Government to ensure that Scotland, Wales and the regions of England benefit fully from the proposals for modernisation and expansion which the industrial strategy is developing.
ENERGY
26. Two further areas where the Government intends to use the oil revenues to enable more to be done than would otherwise have been the case concerns the production and conservation of energy itself.
27. The first is investment in new energy sources to meet the needs of our economy in the medium-term and then to assure our supplies when North Sea oil and gas begin to run out. On current forecasts, United Kingdom primary energy demand is expected to rise from a total of 200m tonnes of oil equivalent in 1975 to perhaps 240m tonnes in 1985, to some 330m tonnes by the end of the century, and to go on rising thereafter. During this period, North Sea oil production is likely to rise to a peak of 100-150m tonnes in the middle 1980s, and then to decline to rather less than 100m tonnes by the end of the century and progressively to decline thereafter. Very substantial investments in conventional energy sources - coal, gas, oil and nuclear power - will be needed if our supply objectives are to be met.
28. In addition to these investments in conventional energy, the next two decades will require a growing expenditure both on new and unconventional sources of fuel supply and possibly on the conversion of primary fuels (eg coal) into more usable forms of energy (eg gas). At present, work on renewable forms of energy - solar, wind, wave, tidal and geothermal power - is in the early feasibility stage and expenditure of funds is comparatively small. The Government will give greater priority to these developments. In due course a high level of expenditure will be needed in these areas so that the economy can continue to grow in the post-oil era. The Government has already published [will shortly be publishing] a Green Paper on Energy Policy which outlines [will outline] important possibilities in the field of energy research and development.
29. Directly linked with this is the need for more energy conservation. Previous conservation policies saved us approximately £2,000m over the last four years; and now policies announced at the end of last year aim at an annual saving of 10m tons of oil equivalent worth some £700m. Reserves of sources such as oil, natural gas and coal are finite, and world demand is increasing. By the end of the century energy could cost two or three times what it costs today. Further developments of energy conservation measures will therefore be an integral part of energy policy, both to reduce costs and to provide more time to develop and introduce the technologies that must ultimately replace existing fuels. A further advantage of investment in energy conservation is that it has short lead times, tends to be labour-intensive, and in some instances offers very high returns. The Government's aim will be to achieve the maximum savings in energy use which can be economically justified.
30. Investment of the oil revenues in replacement energy and conservation is a way of spreading the benefits of North Sea oil forward so that future generations may enjoy the security of energy supplies which we have today: and it may be one of the most productive ways in which they can be invested. It is likely to enjoy a high rate of return in its own right. And by reducing and postponing the need to import energy, it will both improve the balance of payments and increase the security of our energy supplies.
TAX REDUCTIONS
31. A programme of major tax reductions, with no direct provision for any expansion in the economy's productive base, would be likely to increase national living standards only temporarily. We have seen many times in the past that a general reflation of domestic demand rapidly results in increased imports and a balance of payments deficit. In the 1980s, with North Sea oil helping the balance of payments by up to £2bn a year, it is possible that we might be able to sustain a consumer-led boom for longer than we have managed in the past. However, we would, in effect, be using our North Sea oil resources to finance a temporary increase in consumption - an increase which would have to be reversed as soon as the oil revenues start to run out, and which would benefit foreign, rather than domestic, suppliers.
32. The Government unequivocally rejects this course. However, there will be scope for tax reductions in the years ahead. We have explained that increases in investment, and in living standards, must come together. Each makes possible the other. Provided that the investment strategy works, the Government therefore sees scope for continuing to reduce the burden of personal taxation. This will not only result in higher economic growth, making possible a return to full employment. It will also ensure that the real take-home pay of working people can be increased without inflationary rises in money wages.
PUBLIC INVESTMENT AND PUBLIC SERVICES
33. The above measures for greater industrial investment, for more energy production and conservation, and for further tax cuts, will substantially benefit private industry and personal consumption. There are those who argue that only the private sector and personal consumption should benefit from the North Sea. The Government rejects that view. In a complex modern industrial society, both public and private spending have a part to play, each supplementing the contribution of the other in our mixed economy. It is for Government to strike a proper balance between the two, allowing for a growth in public investment and services commensurate with what the economy can afford.
34. The Government intends to retain a firm control over public expenditure so that it remains within the limits set out in the annual Public Expenditure White Papers and does not absorb too high a proportion of the nation's resources. However, certain areas of the public sector can be identified where it would be in the national interest to devote some of the North Sea revenues.
35. The investment plans of the nationalised industries will need to match the expansion of the economy: expenditure on essential communications, docks, harbours, etc, must keep pace.
36. The problem of our inner cities is also urgent. The Government has already given priority to its plans for reinvigorating the inner areas of certain specified conurbations. North Sea revenue will enable this programme to be pursued with continuing vigour in the years ahead. In these areas what still remains of the social fabric of Victorian England - the run-down houses in which many of our immigrant communities live, the hospitals and schools which all sections of the community use - is collapsing and must be renewed.
37. We shall also need more ambitious training and retraining programmes, both in schools and in further education, to develop industrial and commercial skills in our working population. Our manpower is our most valuable enduring national resource and during much of the period when the oil revenues are flowing, the supply of young people to employment will be falling. Two things follow. The preparation of young people for the world of work must be the best we can give them, developing fully their potential talents. Secondly, there will be the need and the opportunity to make it possible for more men and women to continue their education and training throughout their working life. In all this the emphasis must be on quality and relevance since North Sea oil creates both the need and the resources in our people and in the skills to safeguard our future.
38. Finally, as Britain grows more wealthy, it is crucial that our society does not forget its disadvantaged - the old, the sick, mentally as well as physically, one-parent families - these must not be neglected. It is a fundamental part of the philosophy of the Labour movement that the underprivileged and disadvantaged have an equal claim on the resources of our society. The good fortune of our natural energy inheritance must be shared among all our citizens. MONITORING PROGRESS
39. This is an ambitious programme but it is fully capable of achievement. It will, however, take years of determined effort as the Government revenue from North Sea oil builds up from £1.5bn in 1979 to at least £3.5bn in the mid-1980s and is channelled towards transforming our economic and industrial performance, securing our energy position in the longer-term and improving our economic and social infrastructure. Precisely because it is a long-term programme that has to be set in a wider context, it will need to be implemented flexibly. This makes it the more necessary to set objectives and regularly to monitor progress towards them. Only in this way can we contain the risk of dissipating the advantages which North Sea oil can give us.
40. The Government have considered whether this need to monitor and account for the use being made of the North Sea revenues can best be done by means of a special North Sea Oil Fund.
Alternative Paragraphs
41A. It is true that the establishment of such a Fund would involve a measure of artificiality. It would be difficult precisely to define the dividing line between those activities which were additional as a result of North Sea oil, and those which would have been financed in any case through the medium of the Government's ordinary public expenditure programme.
42A. However, the Government believe that other considerations outweigh this. From a psychological point of view, a Fund would help to concentrate the public mind on the once-and-for-all nature of our North Sea wealth, and the need to use it in the interests of the whole nation. In particular, we need to ensure that to the maximum extent possible the use of the oil revenues will be visible and accountable. We have therefore decided to set up an Oil Fund which will focus public attention on this new source of revenue and which will help to ensure that the revenues are not dissipated unwisely. The Government believe that both Parliament and the public will welcome the opportunity which the Fund will provide for continuing informed discussion about the distribution of a precious national asset. 418. The main argument put forward for a Fund is that it would avoid the revenues being dissipated unwisely and would provide the medium for continued informed discussion about the distribution of a previous national asset. A Fund in the technical sense would, however, only be practicable if the oil revenues were being devoted to a few major projects or activities which would not otherwise have been undertaken and which were financed solely or mainly in this way. The Government's intention is, however, to use the benefits of North Sea oil as one element in a much wider strategy for national recovery. This means that there would be no way of showing with any conviction what expenditure on, eg industrial investment, energy resources or infrastructure, was part of the Government's ordinary programme and which was additional as a result of North Sea oil.
423. The Government do not therefore propose to establish an Oil Fund as such. But it is essential that progress towards the objectives set out in this White Paper should be properly and publicly monitored. The Government intend to make an annual report to Parliament on the progress made towards its objectives for the use of the North Sea revenues. This would also allow account to be taken of the wider benefits which the North Sea will provide in the running of the economy which could not in any case form part of an Oil Fund.
CONCLUSION
43. For the next decades we shall have the considerable revenues of North Sea oil and fewer balance of payments problems than we have had since the war. This must not be seen as a temporary breathing space in which to enjoy a standard of living we have not earned, but as an opportunity to secure lasting national economic recovery. This means setting clear priorities for the use of North Sea benefits.
44. The Government are confident that the strategy described in this White Paper is the right one. The Government will set the framework and play its own part: we are committed to increasing economic activity and employment. Better living standards should follow from that and from the tax reductions which can be genuinely afforded. Investment in both the private and public sectors is an essential part of the strategy. But investment, whether in manufacturing industry, in the energy industry or in essential social infrastructure - is not enough. There is a need to encourage and harness the energies and talents of the British people if we are to secure both greater productivity and the development of a socially just free and fair society. It is in that spirit that we should use the opportunity presented by North Sea oil.
24 January 1978 CABINET
COMMON FISHERIES POLICY
Note by the Minister of Agriculture, Fisheries and Food and the Secretary of State for Scotland
1. The attached note by the Minister of Agriculture, Fisheries and Food and the Secretary of State for Scotland will be considered by the Ministerial Committee on European Questions on Wednesday 25 January. It is circulated to members of the Cabinet as background for discussion of this subject under Item 3 of their agenda for Thursday 26 January. Members of the Cabinet may find it useful to have in mind the main objectives in COM(78) 2 to which the present note refers.
2. These are
a. **Quotas** - an allocation of fish that reflects our distant water losses and our contribution to resources.
b. **Conservation** - satisfactory Community conservation measures and a right in certain circumstances to take our own national measures.
c. **Coastal belts** - exclusive access to fishing grounds within 12 miles of our coast subject to the phasing out of existing historic rights.
- preferential access for United Kingdom vessels to fishing grounds between 12 and 50 miles.
J S BM
Ministry of Agriculture, Fisheries and Food
24 January 1978 COMMON FISHERIES POLICY NEGOTIATIONS
Note by the Minister of Agriculture, Fisheries and Food and Secretary of State for Scotland
1. COM(78)2 was discussed by the Committee on 12 January and described the position following the Fisheries Council in December and the prospects for the Council of 16 January. This note brings the position up to date and seeks guidance for further meetings of the Council which will begin on 27 January.
2. The most important general point about the last Council was that, despite difficulties, it did not break down. The Belgian Presidency made a somewhat alarmist public statement but there was in fact no atmosphere of crisis. On the other hand there was little clear progress but the Council meeting was probably a stage which had to be gone through on the way towards an ultimate settlement. The pressure upon us to settle quickly remains very heavy and will undoubtedly be renewed at the next meeting, which is being put about as the meeting at which final decisions will have to be taken.
3. Quotas - turning to the main individual issues Commission proposals on quotas are (as we told the Committee on 12 January) a genuine advance on any previous quota proposals and indeed go further in our direction than we would have expected even if they still fall somewhat short of our objective. They were not discussed at length during the Council but were received with so little comment that it appears likely that they could be agreed. Denmark is the main sufferer from the Commission's efforts to meet our position but there is nevertheless some indication that the Danish Minister might accept the proposals despite strong opposition from his own industry. The Presidency pressed us to agree to the quota proposals but we have always refused to allow individual issues to be settled until we can see the CFP package as a whole and we did so again on this occasion. Nevertheless we must recognise that it may become very difficult to make a major issue out of securing further improvements on quotas - which would inevitably be modest - if everyone else accepted them and we were able to secure our main objective on other parts of the package. We would therefore recommend our colleagues to allow us authority to accept the Commission quota proposals, subject to such minor improvements as we can get, if at the same time we could secure a satisfactory settlement on the other issues. The figures have already been rejected by the industry and there would therefore be some presentational advantage in seeking some increases, even in the less important species.
4. Conservation - this was a disappointing Council as regards conservation. At the start of the meeting the Commission produced revised proposals which were weaker than their earlier proposals on 3 important items: the size of the Norway pout box; increasing the minimum mesh size for the main and vitally important white fish species; and the carriage of large and small mesh nets on the same voyage. We know that most other Member States dislike strong conservation measures and that the Commission are lukewarm - as they have again proved in their revised proposals. For the moment our position is covered by our general reserve on any single aspect until we can see the whole package. We shall continue to press for firm measures. Obviously however we shall have to accept some compromise if agreement is to be achieved. The highly sensitive issue of national rights to take conservation measures was not discussed, but we will clearly be under heavy pressure at the next Council to accept a very much circumscribed procedure which would substantially reduce our present freedom of action.
5. Coastal belts - this was the first Council meeting at which the issue of coastal belts began to be seriously discussed. On the 12 mile belt our aim of exclusive control after allowing time for existing historic rights to be brought to an end is not only of real economic importance but in the eyes of the industry is a touchstone of the Government's determination and success. At present, the Commission proposals merely provide for the rights of other members inside 12 miles to be defined and limited. We argued that they must be terminable.
6. On the 12 to 50 mile belt the Commission have so far made no proposals but Commissioner Gundelach did undertake to state how the concept of fishing plans (that is arrangements for limiting fishing effort in defined areas) "might be a vehicle for overcoming the political difficulties with which we are concerned". Most Member States, and up till now the Commission themselves, remain firmly opposed to our objective of preferential access between 12 and 50 miles although Ireland is of course on our side and we may be able to get sympathetic neutrality from Italy provided we give her a measure of support over her worries about fishing off West Africa. In any case while we can be reasonably flexible about how we achieve access preference it is a vital objective and is the best means of achieving some permanence and reality in the quota preference we now seem likely to obtain. We have therefore arranged informal consultations with the Commission and will be able to report on these at the meeting of the Committee. We understand however that the Commission are reluctant to take the initiative in tabling proposals at this stage without a firm mandate to do so.
CONCLUSION
7. The CFP negotiation continues to be of the utmost difficulty. The pressure to settle during the week beginning 30 January is likely to be very heavy and we should not rule out the possibility or the need to make an agreement then. To some extent the evident anxiety of the others and especially of Germany to get this issue out of the way may act to our advantage. We therefore invite the Committee to agree the following:
(i) our reserve on all parts of the package should be maintained until the whole of it is clear. The following points are subject to that.
(ii) We may have discretion to accept the Commission's quota proposals, subject to some possible improvement.
(iii) We should continue to strive for a better conservation proposal than is now being made but should exercise judgement on how far to press this if other items are satisfactory. (iv) We should continue to aim at retaining the national right to introduce conservation measures but should again have discretion to accept limitations upon it in the light of the rest of the prospective package.
(v) We should insist on ultimate exclusive access within 12 miles and on an access preference between 12 and 50 miles reflecting a preferential quota position. While we should aim to avoid any final breakdowns of negotiations we should not allow ourselves to be hurried into a settlement and we should not make agreement at the next Council unless these points on access can be achieved.
Ministry of Agriculture, Fisheries and Food 23 January 1978 CABINET
SPECIAL EMPLOYMENT MEASURES
Memorandum by the Secretary of State for Education and Science and Paymaster General
1. There are now over 1.5 million registered unemployed. But for the impact of special employment and training measures this figure could be up to 4 million higher. Over the next year labour supply is likely to increase by 170,000.
2. Against this background the Ministerial Group on Unemployment Among Young People (GEN 27) has been considering the need for continuing special employment measures when the existing Temporary Employment Subsidy (TES), the Job Release Scheme (JRS) and the Small Firms Employment Subsidy Scheme (SFES) run out at the end of April. The Group consider that special employment measures will continue to be needed and that the right course at present is to build on existing measures though we are proposing to consider in addition any suggestions that may be forthcoming. Our views and recommendations on continuation of the existing measures are as follows.
TEMPORARY EMPLOYMENT SUBSIDY
3. TES gives employers a subsidy of £20 a week for up to a year for each redundant job they retain, with the possibility of a six month supplement at £10 a week. This is by far the largest of the special measures (at mid-December 1977 it covered 186,000 jobs with a register effect of 133,000). It is also the cheapest, with negligible net costs. We agreed that it, and the six month supplement, should continue for another year, subject to any modifications to take account of European Economic Community (EEC) objections (see paragraph 7 below).
SMALL FIRM EMPLOYMENT SUBSIDY
4. The SFES currently provides a subsidy of £20 a week for each extra job provided in manufacturing establishments of less than 50 employees within Special Development Areas (SDAs). About 8,250 jobs should be supported by March 1978. About one third of the jobs would not otherwise have been created. We agreed that the scheme should be extended to manufacturing firms of up to 200 in Development Areas (DAs) as well as SDAs and also in Inner City Partnership Areas. This would create a maximum effect on the unemployment register in 1979 of 4,750 at a gross annual cost of £21 million. Mr Booth would like the subsidy to be available country-wide which would push up the register effect to 23,000 and the gross cost to £105 million; he would also like to pay a higher rate in the Development Areas and Inner City Areas. The Group thought that Mr Booth's recommendations should be accepted only if there were a significant reduction in the impact of TES resulting from EEC Commission restrictions.
JOB RELEASE SCHEME
5. JRS provides a tax free allowance of £26.50 for up to a year for employees within one year of the state pension age who leave their jobs and the employer agrees to recruit a replacement from the unemployment register. It is limited to Assisted Areas and currently reduces the unemployment register by about 8,000 at an annual gross cost of £11.5 million. The Group agreed that the scheme should apply country-wide and that the allowance should be up-rated to about £28-£30, broadly in line with parallel social security benefits. This should have a maximum effect on the register in 1979 of upwards of £17,500 at an annual gross cost of £25 million plus. Mr Booth would like to increase the period of eligibility to two years and the allowance to £40, tax free. This would increase the impact on the register to 78,000 and the annual gross cost to £170.0 million. The majority of the Group thought £40 too high and noted also that legislation would be necessary to keep it tax free if paid for a second year. They thought it would inevitably increase the pressure for other benefits to be untaxed and that many of the beneficiaries might also have occupational pensions. They also thought that it could build up pressure for a lowering of the retirement age generally and would be resented by low-paid workers and by others on social pension and benefits.
OVERALL EFFECT AND COST OF MEASURES (See also Annex)
6. Mr Booth's proposals would increase the employment effects by about 100,000, giving an overall effect on the register of all measures of 360,000 by March 1979. This does not include any offset in TES to meet the EEC Commission. GEN 27's recommendations would give a figure in excess of 283,000 by the same date, an increase of over 23,000 on present levels. Subject to any offsetting savings Mr Booth can find, the gross costs would be a charge on the Contingency Reserve, amounting, under his proposals to £277 million in 1978-79, and under GEN 27 proposals to upwards of £144 million (the £277 million does not allow for the cost of giving more under SFES to firms in DAs and Inner City Partnership Areas and the £144 million does not allow for any increase cost if the JRS allowance is increased to £28-£30). If the present schemes were continued unaltered the comparable cost would be £127 million. On Mr Booth's proposals his Department would require an extra 240 staff in addition to 270 already engaged on these schemes.
EEC COMMISSION
7. Following complaints from some member states, the Commission wish to impose severe restrictions on the continuation of TES in the textiles, clothing and footwear industries, which they regard as distorting competition and exporting unemployment. Without EEC approval by 1 April, payments in respect of applications received after 1 April would be illegal. We ought to put in our detailed proposals by the end of this month as the Commission is entitled to take two months to consider them. Views in GEN 27 were divided on whether to take a tough line with the Commission, yielding no material concessions and accepting that this would probably lead to an adverse decision in the European Court, or whether to attempt to achieve a negotiated settlement. Under the first approach the conditions we might be forced eventually to accept could be stiffer than those we might be able to negotiate but they would be clearly seen as imposed upon us. The majority of the Group thought that a willingness to negotiate, at least, initially was the right course; and that it was only realistic to look seriously at options which would enable us to phase TES down, such as a short time working compensation scheme. There may be some possibility that negotiations with the Commission on TES would be eased if it was clear that it would be replaced by a more acceptable scheme.
RECOMMENDATIONS
8. The majority of the Group recommends -
a. Continuation of TES and Supplement for a further year (subject to modifications to meet EEC requirements).
b. Extension of JRS to the whole country, on a one-year basis, with an increase in the weekly allowance from £26.50 to £28-£30 at Mr Booth's discretion.
c. Increase in the size of manufacturing firm eligible for SFES to 200 employees and extension of eligibility to Development Areas and Inner City Partnership Areas, but that if material reductions in TES have to be made, SFES should be available nationally, with higher payments in respect of firms in DAs and Inner City Partnership Areas.
d. An attempt to reach a negotiated settlement with the Commission on TES.
e. GEN 27 should consider proposals for a short time working compensation scheme (and any other proposals Ministers may put forward) as a possible substitute for reductions in TES.
S W
Department of Education and Science
24 January 1978 | 1 TDS on present basis | Full effect on unemployment register in 1979 | Gross annual cost (£m) | Net annual cost (£m) | Actual gross cost in financial years | |------------------------|---------------------------------------------|------------------------|---------------------|-------------------------------------| | | | | | 1978/9 | 1979/80 | 1980/81 | | 2 SFDS extended to companies with up to 200 employees | 115,000 | 223 | 0 | 115 | 105 | 3 | | - for whole country | 23,000 | 103.0 | 32.0 | 60 | 19 | 0 | | - for Assisted Areas | 9,550 | 43.0 | 12.6 | 26 | 8 | 0 | | - for Development Areas | 4,750 | 21.0 | 6.1 | 14 | 4 | 0 | | 3 Job Release Scheme on a national basis open to those within 1 year of retirement with | | | | | | | | - £40 allowance | 39,000 | 85.0 | 43.0 | 51 | 34 | 0 | | - £35 allowance | 30,000 | 57.0 | 21.0 | 34 | 23 | 0 | | - £26.30 allowance | 17,500 | 25.0 | 8.0 | 15 | 10 | 0 | | 4 Job release scheme on national basis open to those within 2 years of retirement with | | | | | | | | - £40 allowance | - 78,000 | 170.0 | 86.0 | 102 | 119 | 34 | CABINET
ECONOMIC OUTLOOK: CASE FOR REFLATION AND INCREASE IN PUBLIC EXPENDITURE
Memorandum by the Secretary of State for Social Services and the Minister for Social Security
INTRODUCTION
1. We are convinced that there is an overwhelming case, on economic and political grounds, for a substantial reflation. A major boost to public expenditure is needed as well as significant tax cuts.
ECONOMIC BACKGROUND
2. Industrial production is stagnant, unemployment is at an unacceptable (and costly) level. The deflation forced on us by the 1976 sterling crisis has been compounded by further unplanned deflation due to massive shortfall in public spending, and although tax reliefs have to some extent compensated for this the offset has come too late to avoid a fall in aggregate demand and a rise in the number of jobless.
3. The Trades Union Congress (TUC) call for a £3 billion budget boost composed of tax cuts and increased public spending, seems to us to be on target.
CASE FOR EXTRA BILLION POUNDS OF PUBLIC EXPENDITURE
4. Last year we drew Cabinet's attention to the prospect of a substantial public expenditure shortfall and it now appears likely that there will be another large shortfall this year. An extra billion of spending next financial year can be presented, at least in part, as designed to offset further excessive shortfall. It cannot convincingly be argued that it would damage international confidence.
5. Some forms of public expenditure, for example child benefits, have the same political attractions and broad economic effect as tax cuts. They give people extra money which they can spend themselves. And child benefit goes directly to seven million women who are particularly pressed by inflation. The woman's vote will be critical at the next election as it has been at earlier elections. Child benefit is also both presentationally and practically an effective way of tackling the problem of incentives to work: it raises the in-work incomes of families who might otherwise be better off (or only marginally worse off) unemployed.
6. Expenditure on improved public services is not only what people expect of a Labour Government but would be, at the present time, a direct form of job creation. The net cost after allowing for savings in unemployment benefits and extra revenue would be substantially less than the gross cost. And we can make sure that the jobs which are created are useful jobs which will benefit the community.
7. For all these reasons we should raise public expenditure programmes by the full amount demanded by the TUC. When we come to spend the money we will need to identify those areas where we are likely to be under the most damaging political attack at the time of the election:
a. The level of unemployment will undoubtedly be a sensitive issue, and we will need a whole range of measures to improve our record.
b. Our record on child support, where we have still to reach the level of provision made under the Heath Government, is bound to be under strong attack.
c. The huge increase in school meal prices budgeted for September 1978 will involve an extra burden of about £1.30 for a family with two children at school. To go ahead with this knowing that an autumn election may be forced upon us, would be sheer folly.
d. Of all the constraints we have put on public expenditure those on the health service have in our view led to the most damaging and continuing criticism.
CONCLUSION
8. We therefore invite our colleagues to agree that:
a. a substantial reflation is needed in the next financial year - of the order of £3 billion in gross terms;
b. although tax reliefs should be a main component, there must also be a package of spending measures for 1978-79 amounting to perhaps £1 billion gross;
c. this package should comprise politically attractive measures such as cancellation of the school meal price rise, employment measures, a further contribution to relieve National Health Service pressures, and a November uprating of child benefit; and d. the cost of the measures should be covered from the Contingency Reserve plus, as necessary, an allowance for shortfall and/or such increase in the public sector borrowing requirement as is necessary to ensure that the Chancellor of the Exchequer has adequate headroom for his Budget.
Department of Health and Social Security
30 January 1978 CABINET
STATEMENT ON THE DEFENCE ESTIMATES 1978
Note by the Secretary of State for Defence
1. Attached is my draft statement on the Defence Estimates; the statement has been agreed by the Defence and Oversea Policy Committee subject to some minor revision which is now incorporated in the text.
2. I invite my colleagues to approve the text so that I may publish the statement on Wednesday 15 February.
F M
Ministry of Defence
30 January 1978 Draft Statement on the Defence Estimates 1978
## CONTENTS
### Chapter 1: DEFENCE POLICY
| Topic | Page | |----------------------------------------------------------------------|------| | Detente and Disarmament | 1 | | Deterrence and Defence | 6 | | Warsaw Pact Capability | 8 | | NATO Defence Effort | 10 | | United Kingdom Contribution to NATO | 14 | | United Kingdom Defence Budget | 17 | | Commitments Outside NATO | 20 |
### Chapter 2: COMBAT FORCES, DEPLOYMENTS, OPERATIONS, AND EXERCISES
| NATO | Page | |----------------------------------------------------------------------|------| | Royal Navy General Purpose Combat Forces | 1 | | The Nuclear Strategic Force | 2 | | Army Combat Forces | 2 | | Royal Air Force Combat Forces | 5 | | Exercises in support of NATO | 7 | | UNITED KINGDOM | | | Operations | 10 | | HM The Queen's Silver Jubilee Reviews | 15 | | REST OF THE WORLD | | | Deployments and Operations | 17 | | Service Assistance Overseas | 20 | | Exercises | 22 |
### Chapter 3: EQUIPMENT
| Industrial and Employment implications of the Equipment programme | 2 | | International Collaboration | 3 | | Production and Development | 5 | | Research | 24 | | Royal Ordnance Factories | 25 | | Defence Sales | 27 |
### Chapter 4: MANPOWER
| Recruitment, Re-engagement and Wastage, and Redundency | 1 | | Women's Services | 3 | | Reserves and Cadet Forces | 4 | | Pay and other Conditions of Service | 6 | | Defence Studies, Education and Training | 8 |
### Chapter 5: SUPPORT
| NATO Co-operation in Logistics | 2 | | Inter-Service Co-ordination of Support | 5 | | Royal Navy Support Organisation | 7 | | Army Support Organisation | 9 | | Royal Air Force Support Organisation | 10 | | Lands | 12 | | Living Accommodation | 13 | | Works | 14 | | Energy Conservation | 14 | | Movements | 15 | | Meteorology | 16 | | Other Support | 17 | DEFENCE POLICY
101. United Kingdom defence policy is based on the North Atlantic Alliance, which has worked well for more than a quarter of a century. The key principle of the North Atlantic Treaty, that an attack on one member is an attack on all, has provided far greater security than any member could have achieved alone. The United Kingdom shares the benefits and the obligations of membership. The Government's policy continues to be to concentrate our defence effort on the Alliance in the ways that can best contribute to the strength of the Alliance and thus to our own security.
102. Defence policy needs to be seen in the wider context of our international security aims, in the service of which defence is a partner with other aspects of policy. These include action to remove or alleviate the causes of international tension, and the continuing search to widen and strengthen multilateral arms control and disarmament wherever possible. The various aspects of detente and deterrence complement one another in reinforcing security. The Government is active in each of them, in close accord with our North Atlantic Treaty Organisation (NATO) Allies.
DETENTE AND DISARMAMENT
103. During the last twelve months there have been some encouraging advances in arms control prospects, notably in negotiations on a comprehensive nuclear test ban and, as a result of negotiations between the United States and the Soviet Union, on strategic arms limitation. Comprehensive Test Ban
104. Since July 1977 the United Kingdom has been negotiating with the United States and the Soviet Union towards a Comprehensive Test Ban Treaty. Our objective is a multilateral treaty banning all nuclear explosions, with effective verification and the adherence of as many states as possible, nuclear and non-nuclear. The negotiations have made good progress. We are now working to narrow the differences on the outstanding issues. We believe agreement can be achieved.
Strategic Arms Limitation Talks (SALT)
105. The interim agreement between the United States and the Soviet Union on the limitation of strategic nuclear arms expired on 3 October 1977, but both governments have said they will continue to act as though it were in force. Negotiations continue between them towards a new agreement and the United Kingdom Government attaches great importance to a successful outcome.
Mutual and Balanced Force Reductions (MBFR)
106. Despite constant efforts by the West, progress in the Vienna negotiations on the mutual and balanced reduction of forces in central Europe is disappointing. The agreed aim of providing greater stability at a lower level of forces without impairing the security of either side seems still a long way off.
107. Western proposals remain firmly based on the principle that force reductions should achieve approximate parity between the forces of the two sides in the area by establishing a common collective ceiling on Eastern and Western manpower. The Alliance proposes specific reductions on each side in forms designed to contribute as much as possible to stability in the area. The West estimates that in ground forces Eastern manpower exceeds Western manpower by more than 150,000, although the East claims that approximate parity already exists. To identify the reasons for this discrepancy the West has been pressing for a discussion of figures, and in July 1977 put forward proposals for a detailed exchange of data. Certain problems have still to be resolved, but it is hoped that an exchange can take place soon.
108. The MBFR negotiations are of great importance, and the Government will continue with its Allies to strive for an outcome that will genuinely enhance stability in Europe. The Government has no intention however, in advance of an agreement, of reducing the forces we maintain on the mainland of Europe in fulfilment of our Brussels Treaty obligations.
Conference on Security and Co-operation in Europe (CSCE)
109. The CSCE follow-up meeting opened in Belgrade in October 1977, following a preparatory meeting in the summer. The conference is considering the provisions of the 1975 Final Act. The ones of direct military relevance are the confidence-building measures, designed to reduce the risks of military miscalculation or misunderstanding.
110. Since the signing of the Final Act, NATO countries, and for the most part the neutral and non-aligned countries also, have implemented these measures in a liberal and forthcoming way. They have notified not only all major manoeuvres involving over 25,000 troops but a large number of smaller-scale manoeuvres (whose notification is discretionary). They have invited observers from CSCE participating states, including the Warsaw Pact countries, to many of their manoeuvres. Until just before the Belgrade meeting, the Warsaw Pact countries took a more restrictive line; for example, they refused all invitations to manoeuvres in NATO countries. More recently, however, they have begun to accept such invitations, and in January the United Kingdom was, for the first time, invited to send observers to a Soviet exercise. In Belgrade, British and other NATO representatives have drawn attention to the discrepancies in the implementation of this aspect of the Final Act. They have sought to develop confidence-building measures further, in particular by strengthening the commitment to notify smaller manoeuvres and movements, and by improving the conditions under which invited observers can operate. The United Nations Special Session on Disarmament
111. The Government looks forward to the United Nations Special Session on Disarmament to be held in May and June, and hopes it will improve the prospects for further measures. The United Kingdom has taken an active part in the preparatory work, and is putting forward some new proposals for action.
Other Arms Control and Disarmament Measures
112. The United Kingdom continues to attach great value to the 1968 Treaty on the Non-Proliferation of Nuclear Weapons, and has continued its efforts to persuade further states to accede to it, and to promote other arrangements to reduce the risk of the spread of nuclear weapons. The Government is playing an increasingly active part in efforts to achieve progress on arms control in the United Nations, the Conference of the Committee on Disarmament (CCD) and elsewhere. Many of these negotiations are entering important new phases.
113. The British draft convention on banning the development, production and stockpiling of chemical weapons and destroying them, tabled in the CCD in 1976, has been further debated. Faster progress may be possible when current consultations between the United States and the Soviet Union are completed. Last May the United Kingdom signed the Convention on the prohibition of military or any other hostile use of environmental modification techniques, which had been negotiated by the CCD and endorsed by the UN General Assembly.
114. 1977 also saw the first Review Conference of the Treaty banning the placing of nuclear weapons and other weapons of mass destruction on the seabed. The United Kingdom welcomed the Conference's re-affirmation of the parties' support for the Treaty.
115. The United Kingdom and the Soviet Union signed in October 1977 a treaty on the Prevention of Accidental Nuclear War. Each party undertakes to maintain and where necessary improve its safeguards against the unauthorised or accidental use of nuclear weapons, and to notify each other immediately of any incident. The Treaty came into force on 10 October 1977, and is similar in purpose to existing agreements between the United States and the Soviet Union, and France and the Soviet Union.
116. The United Kingdom has also, with a public explanation of its position on them, signed two Protocols to the 1949 Geneva Conventions. These Protocols extend and bring up to date the provisions of the Geneva Conventions and the 1907 Hague Rules of Warfare. They significantly improve the protection given to the victims of war.
DETERRENCE AND DEFENCE
117. The realities of today's world mean that, however high our hopes and desires, we cannot responsibly assume that our efforts for detente and disarmament will be enough on their own to ensure adequate security. A major defence effort is also needed, and is indeed a precondition of successful political action. We must therefore continue to make a proper contribution to NATO's strategy of deterrence.
118. For effective deterrence the Alliance needs to convince any aggressor that the use of force, or the threat of its use for political ends, carries risks far outweighing any likely advantage. NATO's deterrent strategy is based on forward defence and the capability of flexible response. Forward defence means that NATO is committed to defend the full territorial integrity of its members and to halt any attack at the earliest possible point. Flexible response means that NATO must have a range of military options wide enough to ensure that whatever form aggression took NATO would have the ability to meet it effectively without having to face an intolerable choice between conceding defeat and using dangerously excessive force from the start. For this purpose NATO deploys three main levels of forces – conventional, theatre nuclear and strategic nuclear. The three levels are inter-dependent, and successful deterrence requires a balanced combination of them.
119. The Alliance must have a strategic nuclear capability broadly equivalent to that of the Soviet Union. Theatre nuclear weapons are needed to deter the use of similar weapons by the Soviet Union and, through their links with the conventional defence on the one hand and the strategic forces on the other, to complete the range of deterrence by showing NATO's resolve to respond at whatever level might be necessary. The use of nuclear weapons would be a matter for the closest political control, but the knowledge that they will be used if necessary to stop aggression is an essential element in deterrence. Finally, without a strong conventional capability the Alliance would be bound to rely heavily on nuclear weapons, so reverting to the "tripwire" strategy abandoned in the 1960s. Such reliance would lower the "nuclear threshold", and seriously weaken the overall credibility of deterrence. WARSAW PACT CAPABILITY
1.20. The forces which NATO needs to implement this deterrent strategy must depend in large measure upon the scale and character of the potential military threat posed by the forces of the Soviet Union and its Warsaw Pact allies. The capability of these forces is formidable and growing.
1.21. The assessment of military balance is complex and many-sided, and cannot be reduced to a single neat ratio. On any view, however, Soviet forces have in many areas been strengthened in size and quality on a scale which goes well beyond the needs of any purely defensive posture. Figures 1-4 illustrate the substantial growth of Soviet forces since 1968 and the current balance of NATO (excluding French forces) and Warsaw Pact forces in the eastern Atlantic and central Europe, two areas crucial to NATO and to the United Kingdom. The comparisons in Figures 3 & 4 can illustrate only a broad trend. They do not reflect two particular factors of concern to NATO, the state of readiness of Warsaw Pact forces in Europe, which has always exceeded that of NATO forces and has recently been improved, and the continued introduction of advanced new equipment. Nor do they take into account geography, deployment, logistic support, strategy and tactics, training and morale. Beyond Europe recent developments in Africa, for example, have shown that the Soviet Union is ready and able to deploy military resources rapidly in support of its political interests in the Third World; this demonstration of conventional capability is a further factor which must be taken into account.
1.22. In the last five years Soviet naval forces have received new classes of submarines, surface ships and aircraft. These include INCREASES in the STRENGTH of SOVIET FORCES in the EASTERN ATLANTIC (the SOVIET NORTHERN FLEET)
**SUBMARINES** (including Ballistic Missile Submarines)
- 1968: 44 Nuclear-powered
- 1977: 104 Nuclear-powered
- Increase: +136%
- 1977: 184
**CRUISERS and DESTROYERS**
- 1968: 6 Missile-armed
- 1977: 23 Missile-armed
- Increase: +283%
- 1977: 36
**FRIGATES and ESCORTS**
- 1968: 45
- 1977: 65
- Increase: +44%
**FIXED-WING MARITIME AIRCRAFT**
- 1968: 170
- 1977: 220
- Increase: +29% INCREASES in the STRENGTH of SOVIET FORCES in CENTRAL EUROPE
**MAIN BATTLE TANKS**
- 1968: 7,250
- 1977: 9,500
- Increase: +31%
**ARTILLERY**
- 1968: 3,200
- 1977: 4,400
- Increase: +38%
**ARMoured PERSONNEL CARRIERS** (including Reconnaissance and Command variants)
- 1968: 5,300
- 1977: 9,500
- Increase: +78%
**FIXED-WING TACTICAL AIRCRAFT**
- 1968: 1,655
- 1977: 1,975
- Increase: +20% The **CURRENT BALANCE** of **READY FORCES** in the **EASTERN ATLANTIC**
| NATO | Warsaw Pact | NATO-Warsaw Pact | |------|-------------|------------------| | **SURFACE SHIPS** | | | | | | 1-1.7 | | **SUBMARINES** | | | | | | 1-1.7 | | **FIXED-WING TACTICAL AIRCRAFT** | | | | | | 1-1.5 | The **CURRENT BALANCE** of **READY FORCES** in **CENTRAL EUROPE**
| | NATO | Warsaw Pact | NATO-Warsaw Pact | |------------------|------|-------------|------------------| | **TOTAL SOLDIERS** |  |  | 1-1.3 | | **SOLDIERS IN FIGHTING UNITS** |  |  | 1-1.3 | | **MAIN BATTLE TANKS** |  |  | 1-2.9 | | **ARTILLERY** |  |  | 1-2.6 | | **FIXED-WING TACTICAL AIRCRAFT** |  |  | 1-2.4 | Delta I and II nuclear-powered ballistic missile submarines, Charlie II nuclear-powered cruise missile submarines, Victor II nuclear-powered torpedo attack submarines, Tango diesel submarines, Backfire bombers for the Naval Air Force, and the Kiev class of aircraft carriers.
123. Soviet ground forces have been strengthened by large numbers of self-propelled artillery, new tanks, infantry combat vehicles, helicopters (some of them very heavily armed) and missiles of advanced design.
124. Major re-equipment programmes have markedly increased the range and weapon-load of Soviet aircraft. Modern swing-wing aircraft such as Fencer and Flogger have entered service, and Backfire has joined the Long-Range Air Force. New armaments and better avionics for reconnaissance, target acquisition and weapon aiming have been introduced.
125. The East German, Polish and Czech armies are being strengthened by more and better equipment, mainly of Soviet origin, such as air-defence missiles, armoured personnel carriers, artillery and obstacle-crossing equipment. In addition, East Germany has received modern assault helicopters and air-defence aircraft. Poland and Bulgaria have new swing-wing tactical aircraft, and Hungary more modern air-defence aircraft.
126. We do not know the exact amount of Soviet military expenditure. The Soviet Union does not reveal figures which could be accepted as comparable with Western defence budget information, and has not been willing to take part in the UN Secretary-General's proposals for a pilot study on standardised reporting of military expenditure. Careful Western assessments suggest however that, on the definitions customary in NATO of what constitutes military expenditure, the scale of Soviet military effort could not be sustained without a continuing resource allocation of the order of 11-13% of Soviet gross national product. It is clear that a very large proportion of the total goes on new weapons systems including an immense high-technology research and development programme over the entire range of military equipment. The Soviet Union also has very large resources of trained military manpower, based on universal conscription with a minimum period of two years' full-time service.
127. Much of the Soviet equipment now reaching the front line in such large numbers no doubt derives from decisions taken several years ago. There is however no sign that more recent developments in the field of detente are leading the Soviet Government to slacken the pace of its military effort.
NATO DEFENCE EFFORT
128. There has been a clear and collective recognition by NATO member Governments, at the highest level, of the need for an appropriate NATO response to the continuing growth of the military capability of the Warsaw Pact. The Alliance's commitment to the deterrent strategy of forward defence and flexible response, based on the triad of force elements, has been strongly re-affirmed, notably by President Carter.
129. The past year has been an extremely busy and productive one for NATO's defence planning work. The Ministerial meeting of the Defence Planning Committee (DPC) in December 1976 accepted that further measures would be needed to reverse the unfavourable trends in the military balance. All member countries have accordingly reviewed their defence contributions for specific force improvements and commitments to strengthen NATO's conventional defence, particularly in the fields of anti-armour and anti-submarine warfare and air defence. Improvements are in hand in all three fields, and national plans will bring further improvements.
130. In May 1977 NATO Defence Ministers took three important steps. First, they agreed to the terms of the 1977 DFC Ministerial Guidance for 1979 to 1984, the key document for national and NATO planning. Member nations were asked to aim at an annual increase in real terms of defence expenditure in the region of 3% from 1979, although it was recognised that for some countries economic circumstances would affect what could be achieved while present levels of force contribution might sometimes suggest bigger increases.
131. Secondly, as agreed at the North Atlantic Council meeting of Heads of State and Government in London in May, the Alliance will undertake a long-term defence programme to make NATO forces better able to meet the needs of the 1980s. Studies are being carried out in ten priority areas: readiness; reinforcements; mobilisation of reserves; maritime strategy; air defence; communications; command and control; electronic warfare; rationalisation (including inter-operability and standardisation); consumer logistics (including war reserve stocks); and the modernisation of theatre nuclear forces. A consolidated report is to be considered by the NATO Summit meeting in the spring of 1978. Finally, to complement this effort, NATO Defence Ministers have agreed on an immediate programme of short-term measures, to be implemented by the end of 1978, in anti-armour defence, war reserve munitions and readiness and reinforcement. At their meeting in December 1977 they endorsed significant improvements to be made in all three areas. The Alliance will for example increase its holdings of anti-armour missiles by about one third by the end of 1978, and similar improvements in stocks of other critical munitions are planned. The United Kingdom is making improvements in each of the areas. A second Royal Marine Commando group will be trained for mountain and Arctic warfare by April 1978, a year earlier than previously planned, and 41 Commando, Royal Marines has been retained and assigned to NATO. It has recently been decided to restore HMS Bulwark to full operational status. A number of reserve helicopters have been earmarked to NATO for anti-submarine warfare and certain Naval communications and training aircraft have been earmarked for general maritime support and utility duties. The Army is increasing the number of Milan anti-tank missiles being deployed to front-line units in 1978 and raising stock levels of other anti-armour equipment. The decision to buy TOW, the helicopter-borne missile, will advance by two years a major improvement in anti-tank capability. Additional armoured, artillery and infantry units are to be made available as reinforcements, and improvements are being planned for reserve mobilisation and the reinforcement of the British Army of the Rhine (BAOR). In addition the rundown in Army manpower has been reduced by 1900 men to compensate for the effects of continuing emergency commitments, especially in Northern Ireland; this will make it possible to improve readiness and to raise standards of training in NATO-assigned units. The Royal Air Force will be building up its medium-range air-to-air missiles and war reserve stocks of sonobuoys, increasing the wartime strength of RAF Regiment field squadrons in central Europe, markedly improving the rates of utilisation of the Harrier, and pre-stocking equipment for selected reinforcement squadrons. Several of these measures are improvements or additions to NATO's proposals. In addition the United Kingdom continues to play a substantial part in the programme of joint NATO exercises.
Alliance Co-operation
133. The 1977 DPC Ministerial Guidance stresses that NATO's resources will be employed to the best effect if, in the development of national plans and programmes, full account is taken of the collective needs of the Alliance. The United Kingdom shares this view, participates fully in Alliance collaborative activities, and attaches the highest importance to the efforts the Alliance is making to increase standardisation and interoperability of equipment.
134. Working within the framework of the Alliance, the Eurogroup continues to provide an important forum for strengthening the European contribution. Eurogroup sub-groups are making steady progress in co-operation on logistic support, battlefield communications, harmonisation of tactical concepts, training and medical services. The independent European Programme Group (EPG), which is recognised by all its members as the main forum for equipment collaboration in Europe, is also making steady progress. It maintains a schedule of member countries' requirements for equipment over the next 15 years to help identify possibilities for collaboration, and has set up eleven project groups to study possible future projects including tactical combat aircraft, helicopters and anti-tank weapons.
135. Another example of Alliance-wide co-operation is the NATO infrastructure programme, which covers fixed installations needed for the deployment and operation of the armed forces. NATO Defence Ministers agreed in May 1977 to additional funding for the 1975-79 period so that a bigger programme will be financed on a NATO basis according to the agreed cost-sharing formula. The main elements of the NATO programme are airfields, including hardened shelters for protecting aircraft; communications, including the development of the NATO integrated system to facilitate political consultation and improve command and control by the NATO military authorities; the NATO Air Defence Ground Environment, covering the whole of NATO Europe, for early warning of and response to hostile aircraft and missiles; and an oil pipeline system from Atlantic and Mediterranean ports to airfields and other installations.
UNITED KINGDOM CONTRIBUTION TO NATO
136. The United Kingdom contributes to each of the elements of NATO's triad of forces and to each major NATO Commander. Our military effort is mainly directed to the four areas where we can best help Alliance defence - the defence of the United Kingdom base and its immediate approaches; the eastern Atlantic and Channel; the Central Region of Europe; and NATO's nuclear capability: The United Kingdom base provides vital support for British forces assigned to NATO, including reinforcements for Allied Command Europe (ACE) and aircraft of RAF Strike Command available to support operations by all three Major NATO Commanders. It also provides base facilities for United States forces stationed in this country or brought in as reinforcements.
The United Kingdom contributes by far the largest part of NATO's readily available maritime forces in the eastern Atlantic and Channel. In addition to Nimrod maritime patrol, Buccaneer strike/attack, Phantom air-defence and Vulcan and Canberra reconnaissance aircraft, virtually the whole of the Royal Navy - the third largest in the world - is assigned to NATO.
In the Central Region of Europe the United Kingdom provides the 55,000 men of BAOR, which can be more than doubled in an emergency. BAOR is equipped with over 600 Chieftain tanks and over 2,000 other armoured fighting vehicles. In addition, twelve squadrons of RAF aircraft are based in Germany in the strike/attack, tactical reconnaissance, air-defence and support roles. These forces play a vital role in NATO's forward defence.
The United Kingdom provides theatre nuclear forces deployed by all three Services and also contributes with the Polaris force to NATO's strategic nuclear capability. 137. British forces also make an important contribution to the Strategic Reserve of the Supreme Allied Commander Europe (SACEUR) including the United Kingdom Mobile Force (UKMF), land and air contributions to the ACE Mobile Force (AMF), and three regular squadrons of the Special Air Service. Royal Marines Commando forces provide reinforcements primarily for NATO's Northern Region.
138. The equipment of all these forces is being constantly improved. The first of a new class of anti-submarine cruisers for the Royal Navy, HMS Invincible, was launched in May 1977, and a second is being built. There is a continuing construction programme of nuclear-powered fleet submarines, with nine now in service, a tenth due to enter service shortly, three more being built, including the first of the new Trafalgar class, and the second of this class due to be ordered this year. The Royal Navy is the only European NATO navy to operate nuclear-powered fleet submarines. The Navy's older frigates and destroyers are being replaced by three new classes, the Type 21 and Type 22 frigates and the Type 42 destroyer, and older minesweepers and minehunters by the advanced Hunt class mine countermeasure vessels. Complementing these new ship classes are new weapons and equipments including the Sea Dart and Sea Wolf guided-missile systems, and Sea Harrier aircraft.
139. For the Army, a new 155mm field howitzer, the FH70, is being produced in collaboration with the Federal Republic of Germany and Italy, and a self-propelled version, the SP70, is in joint development. The Franco-German Milan anti-tank missile is being Procured, together with the American TOW for the helicopter-borne anti-tank role. The British anti-aircraft missile systems, Rapier and the man-portable Blowpipe, are in service in BAOR. Further improvements are being made to Chieftain main battle tank.
The main feature of the RAF equipment programme is the acquisition of 385 Tornado multi-role combat aircraft. In March 1977 the decision was taken to develop the Nimrod airborne early warning (AEW) aircraft, which are planned to be interoperable with, and complementary to, whatever AEW system the rest of the Alliance adopts. The maritime patrol Nimrods will be extensively re-equipped by the early 1980s and the Royal Air Force will also get improved short-range air-to-air missiles (Sidewinder AIM 9L) and a new anti-surface ship missile. New medium-range air-to-air missiles (Skyflash) are already in production.
Further details of equipment programmes are given in Chapter 3. On the latest NATO figures the United Kingdom spent a higher proportion of her defence budget (21.8%) on major new equipment in 1977 than any other of the eleven Allies covered by the survey. We also maintain a wide-ranging research and development programme, accounting for 13% of the defence budget.
UNITED KINGDOM DEFENCE BUDGET
At the end of 1976 the Government decided that defence must contribute towards the reductions in public expenditure required to strengthen the United Kingdom economy. The defence budget for 1978/79 was reduced by £230 million, equivalent to £267 million at 1977 Survey prices. The Government undertook to consult NATO about how to make the savings with the minimum adverse effect on our front-line contribution to the Alliance and its essential support. Detailed proposals were put to NATO in June, and in August there were staff discussions between the Ministry of Defence and NATO. In September Alliance views were conveyed to the Government by the NATO Secretary-General. The Alliance expressed concern at the cumulative effect of successive reductions in the defence budget, but acknowledged the Government's success in keeping to a minimum the effect of the £267 million reduction on our contribution to front-line forces.
In reply, the Government welcomed the Alliance's agreement to the method of making the saving, and emphasised the large continuing contribution made by the United Kingdom to the Alliance. As Figure 5 shows, United Kingdom defence expenditure in 1977 accounted for 4.9% of gross domestic product (GDP) at market prices, compared with 5.7% the previous year. Figure 5 also shows NATO countries' defence expenditure in dollar terms. These statistics use market exchange rates, which do not necessarily reflect the true relative purchasing powers of individual currencies and so are not a complete guide to comparative resource allocation to defence.
The proposals put to the Alliance for achieving the £267M saving (reduced to £261M as a result of the 1977 Public Expenditure Survey) were refined during the course of scrutiny of 1978/79 Estimates. About half of the saving will come from the equipment programme, about one fifth from works and accommodation stores, and the balance from miscellaneous changes including offset receipts (see paragraph 146). For the years after 1978/79 the Government proposes to respond positively to NATO's call for increased resources for defence and to meet the target set for increased expenditure in 1979/80. Plans for future levels of defence expenditure agreed in the 1977 Public Expenditure Survey and published in Cmd 7049 provide for increases in the defence budget of 3% in 1979/80 compared with the previous year, and a further 3% in 1980/81. The provision for 1980/81 is subject to review in the 1978 Public Expenditure Survey in the light of economic circumstances. The 1981/82 figure is for the time being simply a repeat of that for 1980/81; no decisions have been taken, since it will be necessary before reaching conclusions to take account of developments in arms control and defence as well as in the economy.
The Defence Budget Estimates for 1978/79 total £6,919 million and are the equivalent in real terms of the target of £6,286 million at 1977 Survey prices. The latter figure incorporates the £8 million defence share of the extra expenditure to help the construction industry announced on 26 October 1977, and allows for receipts under the offset agreement concluded with the Federal Republic of Germany in October 1977 and described in Cmd 6970. Pay and Price increases account for £633 million (see Table 1 of Annex A). The defence budget is about 4.2% of the estimated GDP at market prices for 1978/79.
The proportionate shares in the Estimates of major categories of expenditure - manpower, equipment, and buildings and miscellaneous stores and services - are shown in Figure 6. Comparisons: NATO Countries 1977
- **US**: Defence expenditure as a percentage of GDP (market prices)
- **UK**: Total defence expenditure (US $ million)
- **FRANCE**: Per capita defence expenditure (US $)
- **FRG**: Defence expenditure as a percentage of GDP (market prices)
- **BELGIUM**: Total defence expenditure (US $ million)
- **NETHERLANDS**: Per capita defence expenditure (US $)
- **PORTUGAL**: Defence expenditure as a percentage of GDP (market prices)
- **NORWAY**: Total defence expenditure (US $ million)
- **DENMARK**: Per capita defence expenditure (US $)
- **ITALY**: Defence expenditure as a percentage of GDP (market prices)
- **CANADA**: Total defence expenditure (US $ million)
**Notes:**
1. These figures, which are provisional, have been compiled by NATO.
2. The expenditure and per capita figures are based on average exchange rates for the first 6 months of 1977.
3. Up to date information is not available for Greece and Turkey. COMMITMENTS OUTSIDE NATO
The Armed Forces also meet the commitments of the United Kingdom Government outside NATO, including those which involve the security of dependent territories. Units of the Army and the Royal Air Force provide a garrison for the external defence of Belize; and a Royal Marines detachment remains in the Falkland Islands. In the Far East units of all three Services provide a garrison for the security of Hong Kong and a Gurkha battalion is stationed in Brunei. In the Mediterranean, British forces are stationed in Gibraltar, in Malta until 1979, and in Cyprus to meet... our commitment to the United Nations Force and to provide for the security of the Sovereign Base Areas. Ships and aircraft of the Royal Navy and the Royal Air Force deploy outside the NATO area from time to time and take part in exercises with other countries. In 1977, it was necessary for forces to be deployed rapidly to Belize and to Bermuda. Freedom of the Atlantic is vital to the security of NATO and the United Kingdom. All the United Kingdom's major ships and amphibious forces are therefore assigned to NATO and would, in time of tension or war, be concentrated in the eastern Atlantic and Channel areas. In addition to important air-defence and anti-surface ship roles, their task would be to meet the threat from the large Soviet submarine fleet, an increasing proportion of which is nuclear-powered, to ensure that important supply routes are kept open and that Allied reinforcements get through. Their task also includes meeting the threat of mines in coastal waters and keeping open the submarine deployment routes. United Kingdom naval forces are under the command of Commander-in-Chief Fleet, who is also a major NATO Commander as the Commander-in-Chief Channel, and a subordinate NATO Commander (to the Supreme Allied Commander Atlantic) as the Commander-in-Chief Eastern Atlantic.
The activities of Soviet naval and air forces operating around the United Kingdom, in the Atlantic and in the Mediterranean continue to be monitored by ships and aircraft of the Royal Navy and the Royal Air Force. In spring 1977 this task included the surveillance, in conjunction with our NATO Allies, of the large Soviet exercise in the northern Atlantic and the Norwegian and Baltic Seas. 203. Ships of the Hydrographic Survey Fleet have carried out surveys to meet specific defence requirements, to improve both our own and NATO's maritime operational capability and to enhance the safety of international navigation.
204. The Royal Marines Commando forces, as a result of the decision not to disband 41 Commando, now consist of a brigade headquarters and four Commandos with combat, helicopter and logistic support.
THE NUCLEAR STRATEGIC FORCE
205. The United Kingdom's Polaris submarines, HMS Renown, Repulse, Resolution and Revenge, between them maintain a continuous patrol and constitute an integral part of NATO's strategic nuclear force.
ARMY COMBAT FORCES
206. The Army combat forces consist of the Regular Army and, after mobilisation, the Regular Reserves and Territorial and Army Volunteer Reserve (TAVR). The Regular Reserves comprise ex-Service personnel who are, for a specified period after their return to civilian life, liable for recall in an emergency. The TAVR consist of men and women, not necessarily with previous Regular Army service, who have accepted liability for mobilisation in an emergency.
207. Some 70% of the Regular and Reserve army will, in time of war, be deployed to the European mainland, and most of the remainder will remain to defend the United Kingdom. Not only is the protection of the United Kingdom of the greatest importance in itself, but it is vital for the reinforcement and support of forces deployed on the mainland of Europe and as a base from which to conduct maritime and air operations.
208. Improved arrangements for the recall of Army Regular Reservists are under examination which would significantly reduce the time required for their mobilisation.
British Army of the Rhine
209. First (British) Corps (1 (BR) Corps) is the main combat element of BAOR and forms part of the Northern Army Group (NORTHAG) which, as part of Allied Forces Central Europe (AFCENT), is responsible for a vital sector of the Central Region. The reorganisation of 1 (BR) Corps referred to in detail in previous Statements on the Defence Estimates will have, for the most part, taken place by 1 April 1978 and will be complete by 1 April 1979. 1 (BR) Corps will then consist in peace-time of four armoured divisions, an artillery division and the 5th Field Force (less certain elements).
Berlin Field Force
210. The Berlin Field Force, some 3,000 strong, is not assigned to NATO but fulfils the United Kingdom commitment to the security of the Western sectors of Berlin. United Kingdom Land Forces
211. The reorganisation of the United Kingdom Land Forces (UKLF) mentioned in last year's Statement on the Defence Estimates will be virtually complete by 1 April 1978. The 8th Field Force became operational on 1 April 1977 and the 6th and 7th Field Forces assume their operational roles on 1 April 1978. The elements of the Regular Army based in the United Kingdom, the Regular Reserves and the TAVR will then fulfil the following roles:
a. Reinforcement of BAOR to its war establishment. The reinforcements include the 7th Field Force; other units stationed in the United Kingdom in peace-time including certain TAVR units; individuals from the training and support organisation; and a part of the Regular Reserves.
b. Contribution to SACEUR's Strategic Reserve and to SACLANT. The Army's contribution to SACEUR's Strategic Reserve is available for deployment throughout ACE and consists of: some 1,800 men as the United Kingdom contribution to the land component of the AMF; the land component of the UKMF, comprising the 6th Field Force and the Logistic Support Group; and the 22 Special Air Service Regiment. In addition the Army provides support and logistic troops for the Royal Marine Commando forces assigned to SACLANT. c. Defence of the United Kingdom. Each District within the United Kingdom contains forces, drawn from the Regular Army and the TAVR, which, together with the 8th Field Force, have specific responsibilities for the protection of vital NATO and national installations and bases. Manpower released from the training and support organisation together with the remainder of the Regular Reserves will further supplement these forces on mobilisation.
ROYAL AIR FORCE COMBAT FORCES
212. RAF combat forces are organised in two operational commands - Strike Command, whose Commander-in-Chief also holds the NATO appointment of Commander-in-Chief United Kingdom Air Forces, and RAF Germany, whose Commander-in-Chief is also Commander of the Second Allied Tactical Air Force which is part of Allied Air Forces Central Europe. Virtually all RAF combat and support aircraft are assigned to NATO. In the strike/attack and reconnaissance roles the Jaguar front-line force has been built up to strength and other front-line aircraft strengths have been maintained over the past year.
Strike Command forces in the United Kingdom
213. Strike Command forces stationed in the United Kingdom are committed to the support of all three major NATO Commanders: SACEUR, SACLANT and Commander-in-Chief Channel. Their task is the air defence of the United Kingdom, including the operation of the Fylingdales Ballistic Missile Early Warning Station as part of the contribution to the NATO-wide early warning system, and air support for land and sea operations in the main NATO command regions, including a range of deployment options throughout ACE as part of SACEUR's Strategic Air Reserve.
214. Strike Command forces are arranged in four functional groups. No 1 Group aircraft operate in the strike/attack and reconnaissance roles over land and sea, with Vulcan B2's and Buccaneers for strike/attack, Vulcans and Canberras for reconnaissance, and the Victor tanker force in support. No 11 Group is responsible for air defence with Phantom and Lightning aircraft supported by Bloodhound and Rapier surface-to-air missiles, Shackleton AEW aircraft and ground radar. No 18 Group, with headquarters co-located with Northwood with those of the Commander-in-Chief Fleet, comprises Nimrod maritime patrol and anti-submarine aircraft, increased from 1 January 1977 by four aircraft to allow for additional offshore surveillance and fishery protection duties, together with Wessex and Whirlwind helicopters in the search and rescue role. No 38 Group is responsible for reinforcement of ACE with Jaguar and Harrier offensive-support aircraft and Jaguar reconnaissance aircraft, as well as for the transport force of VC10's, Hercules and Wessex and Puma helicopters. The RAF Regiment also provides, within the United Kingdom, a squadron committed to NATO for low-level air defence, and field squadrons for ground-defence duties. RAF Germany
215. RAF aircraft and surface-to-air missile systems in Germany are assigned to SACEUR and form part of the Second Allied Tactical Air Force. Buccaneers and Jaguars operate in the strike/attack role and Jaguars also have reconnaissance responsibilities. The vertical and short take-off and landing Harriers operating from dispersed field sites provide offensive air support and tactical reconnaissance for NORTHAG. Phantoms are available for air defence and Bloodhound surface-to-air missiles provide area defence of airfields. The RAF Regiment operates the Rapier surface-to-air air-defence missile systems and is engaged in the local ground defence of RAF airfields and of the Harriers in the field. A squadron of Wessex helicopters supports 1 (BR) Corps and from 1 April 1978 a further Wessex squadron will also be available for reinforcement.
EXERCISES IN SUPPORT OF NATO
216. All three Services have continued to make significant contributions to NATO exercises in 1977. Within ACE, emphasis has again been placed on the AUTUMN FORGE exercise series, a collection of exercises designed to demonstrate NATO integration and flexibility. Emphasis has also again been placed on the training of Regular and TAVR soldiers from the United Kingdom, and this year over 40,000 of them trained on the European mainland. A recent measure to improve the value of exercises has been a study designed to make better use of expensive resources by integrating national and NATO exercises.
**Eastern Atlantic Area**
217. An important NATO maritime exercise, OCEAN SAFARI 77, was staged last October in the Iberlant and Eastlant areas and southwest approaches to the United Kingdom. The United Kingdom contribution to this exercise comprised 16 warships, including HMS Ark Royal, HMS Hermes and the frigate assigned to the Standing Naval Force in the Atlantic, together with eight Royal Fleet Auxiliaries and 13 RAF squadrons. The exercise was designed to demonstrate NATO's determination and ability to retain control of sea lanes vital to this country and to the reinforcement of Europe.
**Northern Region**
218. The 6th Field Force and the United Kingdom contingent of the AMF participated in Exercise ARROW EXPRESS in Denmark in September 1977, practising co-operation between the Danish Army and external reinforcements. Similarly, the United Kingdom will take part in Exercise ARCTIC EXPRESS in March 1978, demonstrating NATO's ability to reinforce the northern flank. The Royal Navy, Royal Marines, the Army and the Royal Air Force will all be involved, exercising winter warfare techniques which have been practised in Norway previously.
**Central Region**
219. BAOE units have participated in three NATO and ten national exercises each involving two or more battlegroups. The annual Central Region air exercise, COLD FIRE 77, took place last September. All RAF squadrons in Germany together with some United Kingdom-based squadrons were involved, and the United Kingdom Air Defence Region was fully tested.
Southern Region
220. All three Services took part in Exercise DAWN PATROL 77 in the Mediterranean. Naval, air and amphibious forces were involved in the region-wide Exercise DISPLAY DETERMINATION 77 to practise external reinforcement to the region and the transfer of command of naval forces across NATO command boundaries. In November 1977 Exercise AVON EXPRESS, which involved contingents of the AMF from five NATO countries, was held on Salisbury Plain. UKLF provided a comprehensive support organisation including elements of the 6th Field Force as exercise enemy forces.
Other Exercises in support of NATO
221. The United Kingdom has contributed to a wide range of smaller exercises in support of NATO ranging from the western Atlantic to the northern flank and eastern Mediterranean. As a means of providing maritime training for both our own and NATO forces, the Royal Navy and Royal Air Force have also conducted a programme of joint maritime courses, well supported by our NATO Allies. Royal Navy mine-countermeasures forces and headquarters concerned with the naval control of shipping have conducted a full programme of exercises, involving also the Royal Naval Reserve, and the Royal Marines have exercised with their counterparts in five NATO countries, including arctic warfare training in Norway and three exercises with sub-units of the Royal Netherlands Marine Corps.
222. Despite the Army's continued commitment in Northern Ireland, six battlegroups from BAOR and one from UKLF carried out tactical firing exercises at Suffield in Canada. Three battalion groups from UKLF also exercised at Weinwright in Canada, one of them taking part in a Canadian brigade exercise. Army units have also exercised in support of their NATO role in the United States, the Federal Republic of Germany, Denmark, Norway, Italy and France. These bilateral exercises have contributed towards better mutual understanding and co-operation, which will lead to improved operational efficiency within NATO.
223. A RAF detachment of Buccaneer and Vulcan aircraft deployed to Nellis Air Force Base in the United States to use the American Red Flag range facilities, gaining valuable training in a simulated hostile environment. 21 RAF squadrons based in the United Kingdom and Federal Republic of Germany utilised the NATO squadron exchange scheme to improve operating techniques. RAF air transport units also held exercises with the American and Canadian air transport forces to practise joint procedures.
UNITED KINGDOM OPERATIONS
Northern Ireland
224. The Government's policy for security in Northern Ireland continues to be based on the development of the Royal Ulster Constabulary (RUC) as the instrument for the maintenance of law and order. The Armed Forces, including the Ulster Defence Regiment (UDR), will remain as the essential buttress of this policy for as long as is necessary. The Armed Forces have maintained their high standards of courage, resourcefulness and effectiveness and last year 20 awards for gallantry were made to personnel serving in Northern Ireland.
225. In June 1977 the Secretary of State for Northern Ireland announced measures to increase the effectiveness of the Government's security policy. These included an increase in the full-time establishment of the UDR, a continuing build-up in the strength of the RUC, a greater emphasis on the acquisition of intelligence and a strengthening of the laws against terrorist offences. There has been a progressive reduction in the general level of violence during the year, with a marked fall in the number of civilian casualties and of shooting and bombing incidents, and increasing success in bringing law-breakers to justice.
In 1977 1308 people were charged with terrorist-type offences, including 266 with murder or attempted murder. The security forces found 590 firearms, 52,091 rounds of ammunition and 2.7 tons of explosive (including neutralised devices). Regrettably there has been no reduction in the scale of security forces deaths since 29 service personnel including 14 members of the UDR have given their lives.
226. All three Services of the Armed Forces are involved in maintaining security, but the Army inevitably bears the main responsibility for providing assistance and support to the police, though the Royal Marines have also been involved in the infantry role. The force level remained at around 14 major units of the combat arms until early 1978 when it was reduced to 13. Reinforcements were called in as necessary to meet the security requirements. A major reinforcement of 3,000 men, including three infantry battalions, was deployed primarily by the RAF air transport force at the time of the United Unionist Action Council (UUAC) strike in May 1977. A total of 47 major units served during 1977. Nine major units have now completed six tours of duty there and six units have completed seven tours. Coastal and lough patrols are carried out by the Royal Navy and Royal Marines to deter the smuggling of arms and the Royal Air Force provides reconnaissance facilities, and, together with the Royal Navy, personnel and logistic air transport support and tactical mobility for the security forces. The RAF Regiment provides protection for the airfield at Aldergrove and for the radar unit at Bishop's Court.
The strength of the UDR at 1 January 1978, including both full-time and part-time members, was 7,812, of which 701 were women. In addition to routine operations, the UDR continues to provide a company-size force each weekend for deployment anywhere in the Province. The UDR now provides immediate military support for the RUC, wholly or in part, in 11 Police Divisions thus... demonstrating the importance of this largely part-time body in the maintenance of security in Northern Ireland. In 1977 elements of five UDR battalions benefited from the greater range of training facilities available in Great Britain and it is planned to extend such training in 1978. There were two general call-ups for the UDR during the year and the turn-out on each occasion was at a gratifying high level of well over 90%. The actions of the UDR during the UUAC strike last May, in response to a general call-up, not only contributed materially to the maintenance of law and order during the strike but also enhanced the UDR's reputation for impartiality and effectiveness.
Further assistance to the civil power
228. During the year Army bomb disposal teams have continued to be available to assist local police forces in the event of bomb incidents in Great Britain. A joint force continues to be held at short notice to support the police in counter-terrorist operations at Heathrow Airport and, at the request of the Metropolitan Police, this force has taken part in seven exercises at Heathrow.
Fire-fighting
229. On 14 November 1977, personnel from all three Services were deployed to assist the fire authorities in maintaining fire cover throughout the United Kingdom during the firemen's strike. At the peak of the operation, some 20,000 servicemen were involved. The servicemen remained on duty until mid-January during which time they attended 39,612 incidents, and received considerable praise from the fire officers supervising them for their success in tackling an unfamiliar task. Inevitably, the commitment of so many man-hours to these duties caused considerable disruption to the normal programme of Service training, and imposed additional separation on many Service families. Protection of Offshore Installations
230. Ships and aircraft are deployed throughout the year for the protection of offshore oil and gas installations. They carry out air and sea surveillance and deterrent patrols and, together with other forces in the area, are available to react swiftly to any emergency. The security of offshore installations and the ability to provide assistance quickly are regularly tested in exercises conducted jointly by the Ministry of Defence and civil authorities. Five new Island class ships, ordered specifically for offshore protection tasks, are now in service together with four additional RAF Nimrod aircraft. These can be augmented whenever necessary by other ships and aircraft. The estimated costs of the protection of offshore oil and gas installations and other offshore tasks are shown in Table 5 of Annex A.
Fishery Protection
231. Since the extension of United Kingdom fishery limits on 1 January 1977 the enlarged Fishery Protection task has been performed with considerable success. In the twelve-mile belt, the Ton class minesweepers of the Coastal Division of the Fishery Protection Squadron carry out their traditional task assisted by fixed-wing aircraft and, as necessary, helicopters. Outside this belt the task is now undertaken by Island class vessels and RAF Nimrod surveillance patrols. The estimated costs of fishery protection and other offshore tasks are shown in Table 5 of Annex A.
Search and Rescue
232. During 1977 RN and RAF helicopters participated in 1303 search and rescue operations, many of which took place under extremely difficult and dangerous conditions. 917 lives were saved and four awards for Gallantry and one commendation for brave conduct were given to the officers and men concerned. The last of the RN Whirlwind helicopters were replaced by Wessex helicopters and plans are well advanced for the introduction of RAF Sea King helicopters for this task.
Other Military Aid to the Civil Community
Throughout 1977 all three Services carried out projects of varying size and complexity. The type of aid given included levelling a playing field in north Yorkshire, airlifting seriously ill patients, and delivering portable dialysis units by RAF helicopter.
HM THE QUEEN'S SILVER JUBILEE REVIEWS
All three Services participated in the national celebrations of Her Majesty The Queen's Silver Jubilee last year. Her Majesty reviewed the Fleet at Spithead from HMY Britannia and ships of the Royal Navy and Auxiliary Services in the Review lines were accompanied by vessels representing the British merchant and fishing fleets and other maritime organisations having close associations with the Royal Navy. Present too were ships from the navies of countries in the Commonwealth, NATO, the Central Treaty Organisation (CENTO) and the European Economic Community. The Review was concluded by a fly-past of helicopters of the Fleet Air Arm. The Review also provided the opportunity to conduct a major national maritime exercise with USN, RAN and RNZN forces to practise joint operating procedures. and tactics. In August Her Majesty inspected the Royal Marines on Plymouth Hoe.
235. The climax of the Army's celebrations, was the Silver Jubilee Review of the Army. Since the largest number of fighting units of the Army were stationed in Germany it was considered appropriate for Her Majesty to review the British Army of the Rhine. During the Review, which took place at Sennelager, Her Majesty was accompanied by the President of the Federal Republic of Germany, Herr Walter Scheel.
236. The centrepiece of Royal Air Force Silver Jubilee celebrations was the Review by Her Majesty at Finningley. Six Queen's Colours, 68 squadron standards and 838 Service personnel paraded on the occasion of the presentation of a new Queen's Colour for the Royal Air Force in the United Kingdom. 141 aircraft took part in a flying display representing the various roles and nearly every squadron in the Royal Air Force and a further 74 aircraft including several from Commonwealth air forces were on static display. 25 aircraft also took part in a specially augmented Queen's Birthday fly-past over Buckingham Palace.
237. In June Her Majesty reviewed the Reserve and Cadet Forces at the Services Military Musical Pageant at Wembley.
238. As part of the celebrations for the Silver Jubilee, Her Majesty, accompanied by His Royal Highness The Duke of Edinburgh, visited Northern Ireland in August. All security forces in the Province played their part in ensuring the success of this visit. REST OF THE WORLD DEPLOYMENTS AND OPERATIONS
Mediterranean
239. a. Cyprus. The Army garrison in the Sovereign Base Areas remains an infantry battalion, two infantry companies, an armoured reconnaissance squadron and a flight of Alouette helicopters, together with their logistic support units. The Army also contributes to the United Nations Force in Cyprus (UNFICYP) one infantry battalion less two companies, an armoured reconnaissance squadron, a flight of Alouette helicopters and logistic support. The Royal Air Force operates a squadron of Whirlwind helicopters in Cyprus of which four are in support of UNFICYP and the remainder in the search and rescue role. A squadron of the RAF Regiment is deployed to protect the airfield at Akrotiri.
b. Malta. A Royal Marine company group, some Army elements and minor administrative units will remain during the rundown and withdrawal period which will be completed by 31 March 1979. The naval facilities in Malta are also being reduced in preparation for the end of the Military Facilities Agreement. The Canberra and Nimrod squadrons based in Malta will have been withdrawn by the end of 1978 and RAF Luqa will close when the Agreement expires on 31 March 1979.
c. Gibraltar. A Royal Navy destroyer or frigate is stationed at Gibraltar and an infantry battalion forms the major part of the garrison. The Royal Air Force also operates the airfield there and a detachment of two Hunter aircraft.
Belize
240. Threatening statements by Guatemalan leaders and the call-up of their reservists led to an increase of tension between the United Kingdom and Guatemala and a further reinforcement of the Belize garrison in mid 1977. Army reinforcements consisted of an infantry battalion tactical headquarters plus two companies, minor administrative units and individual reinforcements to the force headquarters. RAF reinforcements included Harriers, a strengthening of the RAF Regiment detachment and an increase in the helicopter support force. Army and RAF reinforcements were flown in by the RAF air transport force. In addition, a Royal Navy frigate together with supporting Royal Fleet Auxiliaries was deployed to Belizean territorial waters.
Bermuda
241. A force of 80 men from Belize and 168 from the United Kingdom was flown to Bermuda in December 1977 in response to the Governor's request for military assistance. The rapid deployment of this force, transported by the Royal Air Force, helped to calm the disturbances and all the reinforcing troops were withdrawn before Christmas.
**Falkland Islands**
242. A Royal Marines detachment supported by the ice patrol ship HMS Endurance in the course of her survey work remains stationed in the Falkland Islands.
**Hong Kong**
243. The Hong Kong Squadron of five patrol craft makes occasional visits to neighbouring states. The garrison remains at four infantry battalions (including three Gurkha battalions), an engineer squadron, an Army Air Corps flight of Gazelle helicopters and a squadron of RAF Wessex helicopters. The Royal Air Force helicopters will vacate Kai Tak in March 1978 and will redeploy to Sek Kong in the New Territories.
**Brunei**
244. Consultations continue on the duration of our commitment of a Gurkha battalion to Brunei.
**Group Deployments**
245. Ships of the Royal Navy and supporting Royal Fleet Auxiliaries are deployed for exercises outside the NATO area from time to time. The helicopter-cruiser HMS Tiger, five frigates and four Royal Fleet Auxiliaries, accompanied initially by a nuclear-powered submarine, sailed from the United Kingdom in September 1977 for a deployment to the Far East lasting about seven months. On the outward passage ships of the group visited ports in the Mediterranean, the Black Sea and the Middle East taking part in the CENTO exercise MIDLINK. before crossing the Indian Ocean en route to Hong Kong, Singapore and Australia. The group returns to the United Kingdom in April 1978 making calls in Japan, South Korea, Philippines, India, Sri Lanka, Maldives and Malta on the way.
246. In May 1978 a group comprising the helicopter-cruiser HMS Blake, the nuclear-powered submarine HMS Conqueror, the Type 42 destroyer HMS Birmingham, four frigates and three Royal Fleet Auxiliaries, will leave the United Kingdom. This group will pass through the Panama Canal in July 1978 for a series of exercises and visits to ports on the west coast of North, Central and South America before returning home shortly before the end of the year.
SERVICE ASSISTANCE OVERSEAS
Disaster Relief
247. Following an earthquake in the Solomon Islands in April 1977, a team of six men from the Queen's Gurkha Engineers in Hong Kong was sent to help survey the damage caused and to assist in reconstruction. After the cyclone in southern India in November 1977, RAF aircraft flew relief supplies to the disaster area. The RAF search and rescue detachments in Cyprus and Hong Kong have also taken part in civil rescues and the Cyprus detachment was heavily engaged on 12 November in the rescue of 117 persons from the Turkish ferry ERTURK I. RAF aircraft have also flown out emergency electricity generating equipment to the Gambia. Hydrography
248. Major surveys are being carried out in Iranian waters on repayment from the Iranian Government. The task covers a period of some three years, and is currently employing three ships of the Hydrographic Survey Fleet. A survey of Marsaxlokk Bay has been completed for the Maltese Government, and further coastal surveys are taking place in Ghana under the hydrographic assistance programme funded by the Ministry of Overseas Development.
Diving
249. In May 1977 a RN diving team working in co-operation with Egyptian naval divers recovered the Gate of Diocletian from the area flooded by the Aswan High Dam. Further diving to recover the ruins of the Temple of Augustus Caesar began in October 1977 and is expected to finish in April 1978. Another RN diving team assisted by Army and RAF bomb disposal experts has completed an assignment to clear unexploded wartime ordnance in the Gilbert Islands and Tuvalu in the western Pacific.
Oman
250. With the exception of a small training team all direct assistance units were withdrawn from Oman during 1977. Prior to departure a Royal Engineer troop completed the road linking Dhofar to Dalquat, which was opened in December 1977. The number of loan service personnel in the Sultan of Oman's Forces is gradually being reduced as Omanis become available to occupy their positions. EXERCISES
251. The total number of exercises outside the NATO area in which the Services participated during 1977 decreased. While on passage RN groups have conducted exercises with naval forces of the United States, the Netherlands, Italy, Portugal, France, Australia and Brazil, and Royal Marine ship detachments have continued to train and exercise in various parts of the world. Army units have trained in Australia, New Zealand, Fiji, Brunei, Cyprus, Kenya, the Gambia, Sudan, the Caribbean and the United States, practising tactics and live-firing in challenging and unfamiliar terrain, and techniques of sea and air movement. The second annual four-month individual exchange of Army personnel took place between the United Kingdom, Australia and New Zealand. RAF aircraft from Malta joined the ships of the group deployment en route to the Far East to take part in the CENTO maritime exercise MIDLINK off the coast of Iran. RAF aircraft also took part in other CENTO exercises in Iran and a RAF mountain rescue team participated in the annual CENTO search and rescue exercise NEJAT also held in Iran. In October last year a Strike Command Nimrod won the Fincastle anti-submarine warfare trophy in competition with aircraft from Australia, Canada and New Zealand. Expenditure on equipment accounts for approximately 40% of the defence budget, and is expected to amount to £2770 million in 1978/79. By comparison (at the same price level) the expenditure forecast for 1977/78 was £2523 million. Including associated personnel and other costs, total procurement expenditure for 1978/79 is estimated at £3060 million, split up as follows:
**FIGURE 7**
| Category | Amount (£ million) | |---------------------------------|--------------------| | Production | £2184 (71%) | | Research and Development | £876 (29%) | | Production of New Equipment | £1044 (44%) | | Development of Approved Systems | £500 (25%) | | Research | £100 (4%) | | Production of Spares etc | £530 (27%) |
- Including R & D support costs e.g. headquarters expenses
302. The £2184 million to be spent on production of new equipment and spares can roughly be subdivided into: 31% on ships, ship equipment and weapons; 26% on Army equipment and vehicles; 34% on aircraft, aircraft engines, aircraft equipment and weapons; and 9% on general support. Of the £2184 million, over £1900 million will be spent with British industry and the Royal Ordnance Factories.
303. Total R & D expenditure at £876 million represents 13% of the overall defence budget and compares (at the same price level) with forecast expenditure of £869 million in 1977/78. £608 million of the R & D figure will be spent extramurally.
INDUSTRIAL AND EMPLOYMENT IMPLICATIONS OF THE EQUIPMENT PROGRAMME
304. In 1976/77, the Ministry of Defence spent £2138 million on defence equipment. Of this about 70% was spent on national contracts placed with British industry, about 20% as our share of collaborative projects and about 10% on contracts placed overseas. Of the payments made directly by the Ministry of Defence to contractors in the United Kingdom the bulk, about £1,600 million, went to the 38 firms (including the Royal Ordnance Factories), listed at Annex H as each receiving more than £5 million.
305. The defence equipment programme generates directly the equivalent of about 200,000 full-time job opportunities, and overseas sales generate about 70,000 more, in the defence industries. Roughly the same numbers again are generated in industry generally in support of the manufacture of defence equipment.
306. The defence equipment programme is therefore large enough in itself to be of considerable economic and industrial significance. The nature of the programme tends to concentrate the expenditure in particular industries. For instance we estimate that about half of those employed in the aerospace industry are engaged on military work including work for export, and shipbuilding accounts for up to a third of those employed in the shipbuilding industry. Defence work will continue to be a major factor in sustaining the levels of employment and technological expertise in British Aerospace, British Shipbuilding and other important associated sectors of industry, notably electronics.
307. Given these substantial effects, the Ministry of Defence recognises the need to take the industrial implications of equipment programmes into account in making procurement decisions, though the primary objective of defence procurement must be to ensure that the equipment needs of the Services are met in the most timely and cost-effective manner.
INTERNATIONAL COLLABORATION
308. The growing complexity and cost of each new generation of weapon systems makes increasingly heavy demands on R & D capacity and budgets throughout the Alliance. No European NATO country can in these circumstances afford to develop from its own resources all its armed forces' requirements. New systems must be built to operate in conjunction with others in NATO, and in some cases it is desirable for them to be standardised. In addition, unit costs are very high if the production is limited to our national requirement. There is thus a continuing need to see how far our own Services' requirements can be met through co-operative procurement arrangements with our Allies, for example, by collaboration in individual projects, which will enable us to maintain the essential range of R & D capabilities and to share in the development of more equipments than we could achieve from national projects alone.
309. International co-operation in this complex field raises difficult problems. Operational requirements and time scales both need to be agreed; the industrial arrangements need to be satisfactory for each participating country; balance-of-trade considerations arising from reciprocal sales and purchases must be taken into account; and the need in the long term to maintain adequate R & D capabilities has to be borne in mind.
310. The United Kingdom is taking a leading part in the efforts to overcome the problems and make co-operation more effective, particularly in Europe. We are active members of the independent EFC which is concentrating on a number of important projects, especially in the aircraft and missile fields. These offer opportunities for collaboration in the development stage of major projects, co-operation in production, manufacture under licence and direct sales and purchases. At the North Atlantic Summit meeting in London in May 1977 President Carter welcomed the initiatives taken by the EPG in Europe, and undertook that the United States would seek increased opportunities to buy European defence equipment. For its part, the EPG has proposed to the United States and Canada that they should jointly examine a number of means to improve the imbalance in trade between Europe and North America in the defence equipment sector, and as a result technical discussions between the EPG and the United States and Canada are under way.
PRODUCTION AND DEVELOPMENT ROYAL NAVY
311. Ships
a. Nuclear-Powered Fleet Submarines. These vessels are designed for hunter/killer operations against surface ships and submarines. HMS Sceptre, the tenth nuclear-powered fleet submarine and the fourth of the Swiftsure class, is planned to enter service shortly and two more of the class are under construction. The order for HMS Trafalgar, the first vessel of a new class of nuclear-powered fleet submarines, was placed last year and a second is planned for the coming year. These submarines will have improvements in equipment, endurance and speed which will enable them to be more effective. in their primary role of hunting and detecting enemy submarines and surface ships in support of NATO operations.
b. Anti-Submarine Cruisers. HMS Invincible, the first of the anti-submarine cruisers was launched in May 1977 and construction work on the second, HMS Illustrious, continues. A third ship of this class is planned.
c. Destroyers. Two Type 42 guided-missile destroyers are now in service and a third, HMS Newcastle, will shortly be accepted into service. Three more are due to enter service in the coming year. Four more ships were on order at the beginning of this year and further orders are planned.
d. Frigates. Seven Type 21 frigates are now in service and the last of the class is expected to enter service shortly. With the launching of HMS Battleaxe in 1977, two Type 22 frigates are now fitting out and two more are under construction. A fifth Type 22 is planned to be ordered this year.
e. Mine Countermeasures Vessels. HMS Ledbury, the second vessel of the Hunt Class of Mine Countermeasures Vessels, is under construction and further orders are planned for this year.
f. Patrol Vessels. Five ships of the Island class have now entered service as offshore patrol vessels. Two further ships of this class have been ordered for a variety of tasks including coastal fishery protection.
F. Fleet Replenishment Ships. RFA Fort Grange will enter service this year and a further vessel is under construction.
h. Refits. The modernisation of HMS Dido, the last of the first batch of eight ships in the Leander class frigate refit programme, is expected to be completed later this year. Modernisation of three ships in the second batch is complete, with four more in progress. Work has also begun on the refit of HMS Andromeda, the first ship in the third batch, which will include the fitting of the Sea Wolf point-defence missile system, Exocet anti-ship missiles, enhanced sonar equipments and electronic warfare equipment.
312. Naval Aviation
a. Sea Harrier. The first front-line Sea Harrier squadron is planned to form in 1980 for embarkation initially in HMS Hermes. The second will embark in HMS Invincible, and ultimately all squadrons will be deployed in ships of her class. The aircraft will be armed with Sidewinder AIM-9L air-to-air and P3T air-to-surface missiles to provide it with a quick-reaction capability. against enemy aircraft and an attack capability against surface vessels.
b. Naval Helicopters. Sea King Mark 1 helicopters are being modified to the standards of Mark 2 helicopters, currently in production. Sea Kings will also be fitted with an improved radar and communications system and an acoustic processor and sonobuoys to supplement the existing dunking sonar. The other helicopter under production for the Royal Navy is the Lynx Mark 2, which will be operated from most destroyers and frigates.
Naval Weapons
313. Air-Defence Weapons
a. Sea Dart. This medium-range surface-to-air guided weapon system is now fitted in three ships, and is expected to be accepted into operational service this year. A programme is under way for an improved Sea Dart system and supporting radars to increase its air-defence capabilities to meet the expected threat in the mid to late 1980's.
b. Sea Wolf. The intensive series of sea trials on board HMS Penelope proved highly successful and production of both missile and ship system has begun. The weapon system is in advance of all others of its type and will provide the Type 22 frigate and other ships with a close-range self-defence capability against missiles and aircraft. A programme of improvements is in hand to maintain the capability of Sea Wolf in the face of expected developments in the threat.
314. **Anti-Surface Ship Weapons**
a. **Sub-Harpoon.** Negotiations were completed with the United States Government last October for the full development of Sub-Harpoon, a submarine-launched, air flight long-range anti-ship missile which will provide the main anti-surface ship armament of our submarine fleet from the early 1980s.
b. **Sea Skua.** This anti-ship missile is expected to enter service in the early 1980's. Carried by the Lynx helicopter, it is intended to provide destroyers and frigates with an attack capability stretching far beyond their horizon.
c. **NATO Anti-Surface Ship Missile.** Joint feasibility studies are now in hand with a number of NATO Allies for the next generation of anti-ship missiles for service in the late 1980s and 1990s.
315. **Anti-Submarine Weapons**
a. **Heavyweight Torpedoes.** Feasibility studies for a successor to the submarine-launched Tigerfish torpedo have begun. b. **Lightweight Torpedoes.** Development is continuing on Sting Ray, the advanced light-weight torpedo. It is designed to succeed the American Mk 46 torpedo and will be capable of being launched from surface ships, helicopters and RAF Nimrod aircraft.
316. **Other Naval Equipment**
a. **Propulsion units.** A new marine propulsion unit based on the latest version of the Rolls Royce Spey aero-engine has entered full development.
b. **Sonars.** Several types of new sonar equipment are being developed and fitted to provide surface ships, submarines and helicopters with improved anti-submarine detection and classification capabilities.
c. **Electronic Warfare and Communications Equipment.** Advanced new electronic warfare and communications equipments are included in national and collaborative development and production programmes. A NATO collaborative development programme is in hand for a decoy system for use against anti-surface ship missiles.
d. **Navigation Equipment.** Production orders have been placed for an improved inertial navigational system which will be fitted in submarines and the new anti-submarine cruiser. Ship Radars. An advanced air surveillance and target indication radar is being developed and will be in service with the surface fleet by the mid-1980s.
Airborne Radars. The Seespray airborne search radar is now in full production. This is being fitted in the Lynx helicopter and will provide target information for Sea Skua missiles. Blue Fox, a derivative of Seespray, is under development and will be fitted in the Sea Harrier for air-to-air and air-to-surface roles.
Action Information Systems. The large majority of the surface fleet will be fitted with computer-based action information systems together with digital data links by the mid-1980s.
Army
Armoured Forces
Chieftain. Work on the planned improvements to maintain and enhance the effectiveness of Chieftain into the 1980s is going ahead. In addition to latest marks of the tank laser sight, units will also this year begin to receive the muzzle reference system. A number of modifications to improve the reliability of the main engine are being incorporated into the fleet. b. **Chieftain Replacement (MBT 80).** The Anglo-German collaborative studies on a future main battle tank were terminated in March last year. Although there was a large measure of agreement on the details of the requirement, both countries felt that collaborative development and production would not be possible, mainly because the timescales in which each country required the replacement tank became incompatible during the course of the joint work. National studies on the best way of meeting our requirement for a tank to be in service by the late 1980s are now in progress, and these will make use of the valuable work carried out during the joint concept studies.
c. **Mechanised Infantry Combat Vehicle.** The second phase of project definition for a mechanised infantry combat vehicle, to replace part of the present FV430 series of armoured personnel carriers in the 1980s, began in August last year. Project definition has also begun on a series of variants.
d. **Tracked Combat Reconnaissance Vehicles.** Two more variants in the series are now entering service - Striker, which carries the Swingfire anti-tank guided weapon system, and the command vehicle, Sultan. The last variants in the series, Samaritan, en armoured ambulance, and Samson, a recovery vehicle, are planned to enter the production phase this year.
e. Combat Engineer Tractor. The new combat engineer tractor will enter service this year.
318. Artillery and Associated Equipment
a. FH 70 and SP 70. The towed 155mm field howitzer, FH 70, will begin to enter service early next year.
The three collaborating countries, the United Kingdom, the Federal Republic of Germany and Italy, are also continuing development work on the self-propelled version, SP 70. Prototypes have been produced and are now undergoing technical evaluation trials.
b. Supervisor. Development of Supervisor, a battlefield surveillance and target acquisition system using real-time data transmission, is continuing. Supervisor is based on an unmanned miniature helicopter, the prototype of which will make its first flight in the spring of this year.
c. Cervantes. Development of a trailer-mounted radar, to locate rocket launchers and mortars, is continuing.
319. Army Guided Weapons
320. Rapier Air-Defence Missile System. Deployment of the all-weather blindfire tracking radar, DN 181, will begin early this year. Studies are now being carried out on further improvements to Rapier and to evaluate the cost-effectiveness of a tracked version.
b. Helicopter-borne Anti-Tank Guided Weapon. Following the evaluation of the Franco-German HOT and the American TOW systems, the Ministry of Defence announced in August last year that TOW is to be adopted and will enter service with the Army Lynx helicopter in the early 1980s. A substantial part of the equipment will be manufactured under licence in the United Kingdom.
c. Swingfire Long-Range Anti-Tank Guided Weapon. Development is continuing of a thermal-imaging night sight for Swingfire. Discussions have also begun with France and the Federal Republic of Germany on the requirement for a third-generation long-range anti-tank guided weapon.
d. Milan Medium-Range Anti-Tank Guided Weapon. It has been possible to accelerate delivery of the initial batch of Milan equipments being bought from the Franco-German consortium, Euromissile. Deliveries of this batch began last year and will be spread over two years. Development of a thermal-imaging night sight for Milan has begun on a collaborative tripartite basis between the United Kingdom, the Federal Republic of Germany and France. Other Army Equipment
a. Light Anti-Armour Weapon. Project definition began last year on a man-portable anti-armour weapon to replace the 84mm Carl Gustav recoil-less rifle and 66mm M72 rocket. Discussions are taking place within the EPG on the possibilities of collaboration.
b. Small Arms. NATO technical trials to select a standard calibre for future small arms began last year, and military tests will begin later this year. The new British 4.85mm weapon system, comprising an automatic rifle and light support weapon, has been entered in the trials and the results should be available by the end of next year.
c. Mines. The Barmine anti-tank mine is now in service and work began last year to develop additional fuses to extend its operational application and improve its resistance to countermeasures. The complementary off-route mine and the Ranger scatterable anti-personnel mine system will enter service later this year.
d. Electronic Warfare. In July last year, an electronic-warfare regiment took its place in the order of battle of 1 (BR) Corps. Most of its equipment will be British, although some is being bought from France. Further improvements in our electronic warfare capability are under consideration. e. **Lynx Helicopter.** Intensive flying trials of the Army version of Lynx have been completed, and the helicopter is expected to enter service in the middle of this year, replacing the Scout.
f. **Vehicles.** The introduction of a range of low-mobility vehicles – a basic cargo carrier, with tipper, fuel tanker and recovery variants – is proceeding according to plan. A main contractor has been chosen by competitive tender for the production of an 8-tonne medium-mobility load carrier which, together with its variants, will form the backbone of the Army's future logistic fleet.
g. **Communications.** The Ptarmigan tactical trunk communications system, which will replace the present Bruin system, has now entered the final stages of development. Ptarmigan has been designed to conform with standards agreed in the communications sub-group of the Eurogroup, to enable future trunk systems to be fully interoperable.
h. **Automatic Data Processing (ADP) System.** Trials will be carried out in BAOR of a new command and control ADP system, Wavell. If these trials are successful it is planned eventually to equip all formation headquarters in 1 (BR) Corps with Wavell to assist them in data-handling. i. Logistic Landing craft. Two newly-built logistic landing craft have been launched. HMAV Ardennes was commissioned in December last year and HMAV Arakan will be commissioned in August this year. These vessels will provide peacetime logistic support to the Hebrides and logistic support for the reinforcement of Europe in war.
ROYAL AIR FORCE
321. New Aircraft
a. Tornado GR1. First deliveries of production aircraft, of which 150 have so far been ordered, are expected next year. The variable geometry configuration will confer great operational flexibility and permit a combination of high-speed low-level flight, good range and an excellent take-off and landing performance. The tri-national flight test programme had amassed some 1,500 hours by the end of 1977, and test data indicate that Service requirements will be met.
b. Tornado F2. The Tornado F2 air-defence variant is now in full development with the first of three development aircraft under construction. It will have an excellent loiter capability and its armament will include Sky Flash medium-range and AIM9L short- range air-to-air missiles, and cannon. The first phase of the airborne trials of an important new air-intercept radar for the Tornado F2 has been completed and the second phase, to demonstrate full mission capability, will being shortly.
c. Nimrod AEW. Full development is under way to convert eleven Nimrod aircraft to the AEW role. They will enter service progressively in the early 1980s, replacing the Shackleton. Mission system avionics will be developed and integrated into a modified Nimrod airframe. The main features of the system will be a new radar, electronic support measures, "identification friend or foe" interrogators, an integrated data-handling system and associated communications equipment. The aircraft is planned to be interoperable to the maximum extent possible with other NATO airborne early warning systems.
d. The Harrier/Jaguar successor. Studies of various designs for an aircraft to replace the Harrier and Jaguar are continuing with the aim of combining a capability for battlefield attack and for air combat in one airframe. The possibility of developing such an aircraft collaboratively is being explored with a number of potential partners in the EPG. Support Helicopters. It is intended to meet the Army's requirement for medium-lift helicopter support by the purchase of Boeing-Vertol CH-147 Chinook helicopters from the United States. The helicopters would be equipped with British equipment, where appropriate, to ensure commonality with equipment already in service with the Royal Air Force. At the same time a number of Wessex helicopters would be withdrawn from the front-line and transferred to other roles, or placed in reserve.
Sea King Search and Rescue Helicopters. The first of the Sea King search and rescue helicopters have been delivered to the Royal Air Force. They will enter service during the year and the Whirlwinds they replace will be withdrawn.
Aircraft in Service
Nimrod Maritime Reconnaissance (MR) Aircraft. The major refit of Nimrod long-range maritime patrol aircraft is now in hand and flight trials of the acoustic processor start this year. The first refitted Nimrod MR2s with the processor, the associated active attack and long-range passive sonobuoys, and the Searchwater radar are due to enter service next year. The refit is to be completed by the mid-1980's. Harrier. An order for a further 24 aircraft has been placed and deliveries should start next year. The feasibility of fitting a new improved wing to the aircraft is also under study.
Jaguar. Work is in hand to increase the take-off thrust and the time between overhauls of the Adour Mk 102 engine. Reconnaissance pods containing British infra-red linescan and camera equipment are now being fitted.
Puma. The fleet will be progressively up-dated by modifications to improve performance and extend component life, and by the introduction of fibre-composite main rotor blades and an ice and snow protection system. Delivery of an advanced tactical navigation system is planned to take place this year.
Phantom. Work has begun on a programme to improve the combat capability of the Phantom to maintain a high level of operational effectiveness until it is replaced by the Tornado F2 in the mid 1980's.
Aircraft Weapons
Air-to-Air Missiles. The Sky Flash medium-range air-to-air missile, to be carried by the Phantom and the Tornado F2, is now entering full production. Requirements for future short-range air-to-air missiles for the Phantom and Tornado F2 will be met by the procurement of AIM9L missiles most of which, subject to satisfactory negotiation, will be manufactured by a European consortium of which the United Kingdom will be a member.
b. Air-to-Surface Weapons. Project definition has begun of the British Aerospace P3T anti-ship sea-skimming missile, which will be fitted to the Buccaneer in the early 1980s to replace TV Martel and will later be carried by those Tornado GR1s which operate in the maritime strike/attack role. P3T will have a considerably longer range than Martel, will be guided by active radar to provide an all-weather day and night capability and will be able to penetrate the enemy's electronic countermeasures (ECM) defences. During the year American laser-guidance kits to improve the accuracy of RAF 1,000 lb high-explosive bombs and laser-designator pods for use on Buccaneers will be delivered. Agreement in principle has been reached with the United States for the co-operative development of an advanced airfield attack system. Other weapons projects include studies of anti-armour and defence-suppression weapons, planned to enter service in the 1980s. 324. **Ground-Based Air-Defence Equipment**
a. **Rapier.** The Rapier systems now in service with the RAF Regiment are being fitted with the Blindfire tracking radar, DN 181. A study of further improvements is under way (see para 319a).
b. **The United Kingdom Air-Defence Ground Environment (UKADGE).** The planned programme of improvements to UKADGE, which is receiving NATO funding support, is now well advanced and development work will begin this year. Work is also in hand to re-equip a number of early warning stations.
325. **Other Electronics**
a. **"Identification Friend or Foe" (IFF).** Feasibility studies are in progress in order to define a replacement IFF system with NATO-wide application.
b. **Communications.** High-speed data communications are planned for the transfer of information required by future command and control systems. Project definition has begun on the exchange of digital data between fighters, AEW aircraft, ships and UKADGE, and the feasibility of introducing a general purpose ground communication system, using digital transmission and computer switching techniques, is being investigated. New very-high frequency (VHF) and ultra-high frequency (UHF) airborne radio systems are being installed in most RAF aircraft to replace obsolescent equipment and to satisfy revised international compatibility standards; new VHF and UHF ground radios are also being introduced. Techniques to improve beyond-line-of-sight radio systems are being studied and the installation of a new HF radio ground/air network for Strike Command aircraft has begun. The United Kingdom is cooperating closely with its Allies to ensure that, where necessary, future communications systems are interoperable.
2. Electronic Warfare. Passive radar warning equipment is being fitted in a variety of combat aircraft and active ECM equipment is planned to be fitted in the Tornado GR1 and the Jaguar GR1. ECM for the Harrier are also being studied.
3. Other Development Programmes
Work is continuing on improving engine safety, efficiency and reliability and on reducing costs. In order to build up experience on advanced technologies relevant to new aircraft and weapons, demonstrator programmes are being carried out on the use of composite materials for helicopters; on the application of Active Control technology to enable the pilot to get maximum capability from the aircraft and allow greater freedom to the designer; and on advanced air-to-air missiles. 327. The defence research programme is carried out both in R & D establishments and under outside contracts. It covers a wide range of activities extending from the generation and assessment of new ideas to experimental work and exploratory development undertaken to the point where an operational staff target is formulated against which feasibility studies and full-scale development of specific projects can be initiated. One of the main objectives of defence research, accounting for about two-thirds of the expenditure, is the removal of major scientific and technical uncertainties before heavy expenditure is committed to development. The remaining one-third of the expenditure is concerned with maintaining an adequate scientific and technological base to meet future military needs. In 1978/79 research is expected to cost £129 million.
328. The Ministry of Defence also manages programmes of research and technology on behalf of the Department of Industry and the Civil Aviation Authority. In many cases these are run as separate civil programmes; in others, joint programmes aimed at military and civil objectives are possible. The total effort involved continues to reduce. In each case an appropriate share of the costs is met by the civil authority concerned. In addition, some of the facilities and capabilities required in establishments for defence purposes also serve the civil research needs of public and industrial concerns, and work on repayment is carried out on their behalf. Total receipts from both sources are estimated to be £24 million in 1978/79. With the creation of British Aerospace in 1977, some re-arrangement of responsibilities, especially on non-defence work, will be required and the implications, including those for defence R & D establishments, are being examined.
329. As a result of the Management Review the headquarters of the Controller R & D Establishments and Research (CER) are being reorganised. The main feature is the delegation to R & D establishments of responsibilities for the detailed formulation, management and co-ordination of extramural and intramural research programmes, with overall policy and control exercised by the reduced and reorganised headquarters under CER.
330. Following the announcement in the 1977 Statement on the Defence Estimates that a separate defence establishment was not required on microbiological research, the Central Policy Review Staff and the Medical Research Council have carried out studies of the civil requirements for the Microbiological Research Establishment (MRE) at Porton. The Government is considering the future of MRE as a civil establishment in the light of the studies. Any proposals will be the subject of consultations with the Staff Associations and Trade Unions concerned.
ROYAL ORDNANCE FACTORIES
331. The Royal Ordnance Factories organisation is now in its fourth year of operation under a trading fund. This method of financing, together with extensions to the delegated powers granted at the introduction, provides the means for it to continue to improve motivation and efficiency and extend the scope of its operations. The organisation continues to meet its financial objective and to make some provision for reserves. Besides meeting the needs of the Services over a wide range of defence equipment, it is broadening the base of its overseas business both in number of overseas customers and its range of defence equipment.
332. During 1978/79 its cash receipts are expected to rise to some £370 million, of which well over half will be from exports. Equipment manufactured during the year will include armoured fighting vehicles, both heavy and light, and including main battle tanks; the 105 mm light gun; the combat engineer tractor; small arms; a wide variety of ammunition; fuses; explosives and propellants; components for use by British industry; and spares of all kinds. The scope of design and development work also continues to widen in close collaboration with the Ministry's R & D establishments and with British industry, and international collaboration in the design, development and production of equipment continues to be fostered.
333. An increased capital investment programme is to be undertaken in order to maintain the standard of plant and buildings required; to introduce new techniques and processes; and to meet requirements for new equipment. The future computer requirements of the organisation are also under review, and steps are being taken to introduce appropriate changes in accounting practice in preparation for the expected adoption of current cost accounting.
334. The size of the overall manufacturing programme is expected to require a slightly increased work force in 1978/79. Training will continue to be given strong emphasis, particularly courses relating to management and safety. The number of apprentices under training is again expected to increase, to meet the requirement for skilled men. DEFENCE SALES
335. Overseas sales of defence equipment and associated services cover a wide range of items produced by British industry and by the Royal Ordnance Factories, with the Defence Sales Organisation providing support, assistance and advice. These sales continue to make a substantial contribution to the country's balance of payments. Equipment sales will probably amount to at least £900 million in 1978/79. MANPOWER
RECRUITMENT, RE-ENGAGEMENT AND WASTAGE, AND REDUNDANCY
401. Recruitment of men and women to all three Services has remained generally satisfactory and, with the exception of several key RAF officer branches and certain other specialist areas, requirements have been met. In the twelve months to 31 March 1978 a total of 39,600 officers, servicemen and servicewomen are expected to be recruited compared with 40,244 recruited during the previous year. Further details of recruitment for the first nine months of 1977/78 and for the same period in the previous year are given in Annex G Table 5.
Recruitment of Officers
402. The number of Royal Navy officers entering from civilian life has been generally satisfactory but there are still shortages among engineer officers and medical officers. The Royal Marines have, once again, recruited the required numbers.
403. Recruitment of Army officers has continued to improve. Many applicants are of high quality and this has been reflected in the award of 43 undergraduate cadetships and 105 bursaries in the last nine months of 1977. A new company, the Rowallan Company, has been formed at the Royal Military Academy Sandhurst to provide additional leadership training, prior to formal entry into the Academy, for those officer applicants for whom the Regular Commissions Board considers it desirable. Recruitment of qualified doctors remains below target but the entry of medical cadets continues to be encouraging.
404. There has been a shortage of candidates of adequate quality to meet the recruiting requirements for the Royal Air Force. It has not proved possible to recruit the numbers required for the General Duties (Pilot, Navigator, Aircraft Control and Fighter Control), Engineer, Security (RAF Regiment) and Administrative (Education) Branches, in some cases by a substantial margin. The University Cadetship Scheme has attracted only half the expected number of recruits to the General Duties, Engineer and Administrative Branches.
Recruitment of Servicemen
405. The recruiting requirements for most branches in the Royal Navy will be met but there will be a shortfall of artificers, an area in which certain categories are already below establishment. The application rate for Royal Marines other ranks remains buoyant and targets should be achieved.
406. Due to the rundown of the Army, the recruitment targets for soldiers for 1977/78 are lower than in previous years and the prospects for meeting them are good. The recruitment targets for 1978/79 and future years will be higher to prevent a manpower deficit in the early 1980's.
407. The 1977/78 airmen target is very similar to the previous year's and there have been no serious recruiting problems, except in some support trades. Re-engagement
408. Re-engagement rates in all three Services remain satisfactory.
Wastage
409. There has been a significant increase in the number of trained officers who have applied for premature voluntary release from the Army in the first six months of 1977/78 and the rate of exit for soldiers has also been high. The Royal Air Force is experiencing an equally substantial rise in applications from trained officers and men, particularly those with considerable skill and experience. No such increase has been evident in the Royal Navy.
Redundancy
410. In the Royal Navy the limited programme of officer redundancy, involving a total of 50 Commanders, will have been completed by 1 April 1979. The Army's redundancy programme will be completed in 1979/80; by 31 December 1977 some 820 officers and 3,500 soldiers had been selected for redundancy, all except 7 officers and 134 soldiers being volunteers. Redundancy in the Royal Air Force is nearly complete and in the three years up to March 1978 728 officers and 1,695 airmen will have left the Royal Air Force. The scheme has been predominantly voluntary though 271 officers were made redundant compulsorily.
WOMEN'S SERVICES
411. Members of Queen Alexandra's Royal Naval Nursing Service and the Women's Royal Naval Service (WRNS) became subject to the Naval Discipline Act on 1 July 1977. The Ministry of Defence is also continuing the policy of providing wider employment for WRNS personnel and some 400 RN shore appointments originally complemented for RN officers but which could be filled by WRNS officers on an opportunity basis have been identified. So far 43 WRNS officers are filling, or have been nominated for, this type of appointment, and members of the WRNS will thus be employed in more of the senior posts in areas of Management, Intelligence, Communications, Operational support, and Staff duties. In the case of WRNS ratings, alterations to the training, role and structure of the WRNS Regulating category have been made to align it with the RN Regulating branch so that a greater degree of integration in employment can be achieved. A WRNS Physical Training and Recreation category has been set up and will open in 1978. A study continues into the opportunities for broadening the scope of employment of the Women's Royal Army Corps in the Army. Members of the Women's Royal Air Force (WRAF) are employed throughout the Royal Air Force at all levels up to Air Rank. In May 1977 the Director of the WRAF was elected chairman of the Committee on Women in NATO Forces for a two-year term.
RESERVES AND CADET FORCES
412. The new arrangements since the lapse of the post of Admiral Commanding Royal Naval Reserves are working well. The strength of the Volunteer Naval Reserves on 31 October 1977 was officers and ratings. The strength of the Royal Marines Reserve was officers and men. The TAVR had another very successful national publicity campaign in the spring of 1977. The particular needs of Scotland and Northern Ireland were recognised by mounting publicity campaigns there in the autumn. The strength of the TAVR on 31 December 1977 was including women, compared with a total strength of 60,104 on 31 December 1976. The Royal Air Force Regular and Volunteer Reserves strength was 3902 on 31 December 1977. The University Officer Training Corps have again proved valuable. During the past year they have increased in size and have produced 76 officers for the Regular Army and 162 for the TAVR.
**Cadet Forces**
The Cadet Forces continue to play an important role in developing amongst young people between the ages of 12 and 20 the personal qualities of self-discipline and leadership and to encourage an interest in the Armed Forces. Since 1 January 1978 the Sea Cadet Corps has been reorganised into six areas more closely aligned to the Royal Navy's geographical areas in the United Kingdom, permitting each of the area Flag Officers to take a more direct interest in the Corps. The size of the Army Cadet Training Teams is to be increased to enable them to organise adventure training for the Cadet Forces. This will enable the Army Cadet Training Teams to take over one of the tasks previously carried out by the Army Youth Teams which are to be disbanded by April 1978 in the interests of economy in manpower and expenditure. The Venture Mk 2 self-launching glider has now been introduced into service to augment the gliding facilities for Air Cadets. This useful and popular activity continues to play an important part in attracting recruits for the Royal Air Force.
PAY AND OTHER CONDITIONS OF SERVICE
Pay and Pensions
414. In their Sixth Report (1977), the Review Body on Armed Forces Pay recommended the payment of a supplement of 5% of total earnings, subject to a cash minimum of £2.50 and an upper cash maximum of £4 a week, to all members of the Armed Forces within their terms of reference. Proportionate rates of supplement were recommended for junior servicemen and women. The Review Body also recommended increases in charges for food and accommodation. These recommendations, which complied with the Government's guidance on incomes set out in the White Paper "The Attack on Inflation - The Second Year" (Cmnd 6507), were implemented with effect from 1 April 1977.
415. The Armed Forces Pension Scheme provides members of the three Services with retirement pensions and terminal grants together with a range of death, injury and other benefits which take account of the special circumstances of a Service career. A number of improvements to the Scheme have been introduced in recent years. In accordance with Government policy for public sector schemes it is intended that members of the Scheme should be contracted out of the additional pension element of the new earnings related State scheme which comes into operation on 6 April 1978 and application has been made to the Occupational Pensions Board for a contracting-out certificate in accordance with the provisions of the Social Security Pensions Act 1975.
Contracting out will have no effect on current benefits but will permit reduced National Insurance contributions and an extension in the provision of preserved pensions for early leavers. Preparations are in hand to enable accrued pension rights to be transferred both into and out of the Scheme.
Family Welfare
416. The Naval Personal and Family Service was formally inaugurated on 1 April 1977. This brings together, under the overall control of the Commander-in-Chief Naval Home Command, the existing Naval welfare and community services and related aspects of housing. In each Area a senior officer in the Command structure will be responsible for ensuring the co-ordination of these services. Sailors and Families Advice Bureaux manned by senior ratings have been opened in all the main Naval ports. The bureaux provide a quick and easy information service for Naval personnel and their families on a wide range of welfare matters and are proving popular and most successful.
Service Voting
417. The new arrangements for the registration of Service personnel and their spouses, contained in the Representation of the People (Armed Forces) Act 1976, are reflected in the Register of Electors coming into force on 16 February 1978. All Service personnel and their spouses are now able to register as Service voters on a once-and-for-all basis and remain on the register for as long as they remain in the Services.
Television in Germany
418. More than 20,000 members of the Services and their families stationed in Germany are now able to receive recorded transmissions of British television programmes and this number will be further increased during 1978.
DEFENCE STUDIES, EDUCATION AND TRAINING
Defence Studies and Education
419. The close relationship between the Ministry of Defence and the universities in the field of higher defence studies stimulates analysis and discussion of defence matters. In 1977 two major seminars were held under Ministry of Defence sponsorship, one on Soviet Military Power, Capabilities and Purposes organised by Southampton University and the other on The Southern Flank arranged by Oxford University.
420. The National Defence College course at Latimer has been reduced in length and the first new style course began in January 1978.
421. The Royal Navy has 166 university cadets and 64 other full career officers studying for degrees at civilian universities. In addition, there are 168 officers reading for a first degree in engineering at the Royal Naval Engineering College Manadon. 135 serving Army officers, six undergraduate cadets and three holders of undergraduate bursaries are reading for degrees in engineering and applied science at the Royal Military College of Science. The Army also has 89 regular officers and 160 undergraduate cadets studying at university, together with 153 students who have entered under the undergraduate bursary scheme. There are also 226 RAF university cadets pursuing degree courses while 28 other serving officers are attending postgraduate courses at university.
422. The Staff College, Camberley has introduced an annual two week course intended to provide selected TAVR officers with a basic knowledge of staff duties and responsibilities.
423. The study of initial RAF officer training mentioned in the 1977 Statement on the Defence Estimates has now been completed. Steps to implement its proposals will be announced shortly.
Engineering Training
424. The comprehensive study of the structure and training of the Engineering Branch of the Royal Navy has now been completed. The changes which are being made are designed to ensure that officers and ratings of the Branch are better trained and organised to deal with modern weapon and propulsion systems. Flying Training
425. A number of Royal Navy pilots are now training with the Royal Air Force for Sea Harrier flying duties. After conversion to the Harrier, they will carry out operational flying training on the RN Sea Harriers based at Royal Naval Air Station (RNAS) Yeovilton. The Lynx training squadron formed at RNAS Yeovilton in January 1978 and is due to remain there until the early 1980's when it will move to RNAS Portland. Jetstream aircraft are being converted to replace the Sea Prince for basic flying training for RN helicopter observers from 1979.
426. There have been three significant developments in Royal Air Force pilot training. The Hawk has been introduced into service for advanced pilot training and tactical weapons training; the Jetstream has been re-introduced for advanced pilot training and refresher flying on multi-engine aircraft; and a new advanced training course using the Wessex has been established for helicopter pilots. Both the Hawk and Jetstream courses make extensive use of advanced simulators. The first RAF pilots also began their operational training on the Sea King helicopter at RNAS Culdrose last November.
427. RAF Finningley is now the centre for all navigator, air electronic and air engineer training. Further progress has been made with the redeployment of training units; the major elements of the Central Flying School are now co-located at RAF Leeming and other elements of the flying training task are being distributed between the RAF College Cranwell, RAF Linton-on-Ouse and RAF Finningley.
Other Training
428. As part of the process of rationalising shore training the School of Maritime Operations at HMS Dryad is being further developed to accommodate related tasks from other training establishments. HMS Daedalus will remain at Lee-on-Solent in modernised accommodation instead of being transferred to the former RAF airfield at Thorney Island. The latter has been transferred to the Property Services Agency for disposal.
429. Steps have been taken to increase the number of junior Regular Army officers with a knowledge of a foreign language. When the proposed measures are in full operation, it is expected that the number of officers trained to colloquial standard in a NATO language will increase from 100 to 250 annually. Most of them will have been trained in German.
NATO Training
430. All three Services continue to play an active part in the process of developing NATO training. Examples of international co-operation in this field are Lance missile training, naval control of shipping training and a pilot course for long-range reconnaissance patrols in the context of land warfare.
431. The Governments of the United Kingdom and the Federal Republic of Germany have agreed in principle that a Tornado training establishment responsible for aircrew conversion training should be set up at RAF Cottesmore; confirmation of Italian participation is awaited. Detailed planning is under way and, subject to final agreement, training is planned to start with the introduction of the Tornado into service.
432. The possibility of establishing a tri-national Weapons Conversion Unit for the Tornado in Sardinia has had to be abandoned because facilities on the required scale could not be provided there. It is now hoped to establish a bi-national Weapons Conversion Unit at RAF Honington where British and German aircrew will be taught to handle the Tornado as a complete weapons system.
433. NATO and other countries also use some of the helicopter pilot training and basic observer flying training provided by RNAS Culdrose.
Commonwealth and Foreign Training
434. During 1977 about 7,000 military personnel from many Commonwealth and foreign countries attended training courses in the United Kingdom. In addition, the three Services also provide personnel on loan and in training teams to assist with local training.
435. The defence support organisation has undergone many substantial changes since the unification of the Ministry of Defence in 1964. The constant objective has been to cut the cost of support to the maximum extent possible without damaging the service to the front-line.
436. Over the years major economies have been made including the rationalisation between the Services of the management of some 20 ranges of stores and equipment; the setting up of common or integrated services, such as the Defence Lands Organisation and the Claims Commission; the integration of the Ministry of Defence Police and the creation of a unified Defence Communications network; the amalgamation of the four Admiralty Supply Departments; the rationalisation of the Army's supply, transport, movement and repair functions; a reduction of the RAF's organisational structure in the United Kingdom from 8 RAF Commands and 9 Groups to 2 RAF Commands and 4 Groups; new working and management techniques; the reduction of overheads and of manpower; and the use of fewer locations and the more economical use of accommodation. Since the 1974 Defence Review this latter process has been accelerated. For example, over 100 sites have been, are being or will be given different roles, transferred between Services or given up. About 20 other proposed closures or changes have been announced or are at various stages of consultation.
437. Opportunities for further economies, especially through closer collaboration with our NATO Allies and also through further inter-Service rationalisation in remaining areas, will continue to be examined closely. But we do not expect, after the achievements of the last few years, that there will be a great deal of scope for large further savings in this field.
NATO CO-OPERATION IN LOGISTICS
504. In recent years there has been growing emphasis throughout the Alliance on making better use, through collaboration, of NATO logistic resources. The United Kingdom plays its full part in this area, and attaches high priority to collaboration throughout the logistic field wherever it is militarily and economically advantageous and consistent with political and industrial considerations. The emphasis given to logistic support in the NATO programme of short-term and long-term initiatives set in hand following President Carter's statement to the North Atlantic Council in May 1977 is particularly welcome. The United Kingdom also attaches importance to the work of the Eurolog Committee and provides the Chairman for both the Eurolog Steering Committee and its Naval Sub-Group. Important areas under consideration in NATO logistics and civil emergency planning studies include the provision of further civil air and sea transport to enable countries, especially the United States and Canada, to reinforce Europe as quickly as possible in an emergency. The United Kingdom has for its part made satisfactory arrangements for the use of civil air and sea transport for our own forces, and arrangements for the support of American lines of communication through the United Kingdom are proceeding satisfactorily. Other studies of importance concern the arrangements for the provision and storage of war reserve stocks and, in response to the short-term initiatives, the United Kingdom is increasing its holdings of some key items.
Achievements in collaborative procurement, standardisation, and interoperability of weapons and other equipment should also permit greater collaboration in the field of logistic support. Guiding principles for the collaborative support of common equipments were agreed by Eurogroup Ministers in 1975 and are now being applied wherever possible. As a result, for example, the NATO Maintenance Supply Agency (NAMSA) undertakes spares support for the FH70 Field Howitzer and CL89 DRONE for the armies of the United Kingdom, the Federal Republic of Germany and Italy, as well for the Lance missile and NATO Air Defence Ground Environment (NADGE) air-defence radars. There are many further examples of direct bilateral and multilateral collaboration between the Allies. Some current examples include:
a. a comprehensive overhaul and repair facility for marine gas turbine engines at the Royal Naval aircraft yard at Fleetlands to service engines of the Royal Navy and other NATO navies;
b. the provision by the Army of support for the British and Belgian armies for tracked combat reconnaissance vehicles, and for the British, Danish and German armies for the Medium Girder Bridge. Similar arrangements covering Swingfire support for the British and Belgian armies are under consideration;
c. the provision by the Royal Air Force of logistic support for aircraft purchased from the United Kingdom by the Norwegian and Belgian air forces and the Royal Netherlands Navy. Co-operative arrangements between the United Kingdom, the Federal Republic of Germany and Italy are already in hand for the support of Tornado when it comes into service. The two-way support arrangement for Jaguar, between France and United Kingdom, has been enhanced by a direct ADP data link between the French computer at Bordeaux and the Supply Control Centre at RAF Hendon. Progress continues to be made on logistic support arrangements with the United States Air Forces in Europe for whom United Kingdom industry is to undertake some depot-level maintenance of F111 aircraft.
Collaborative arrangements with the United States for the support of RAF Phantom and Hercules aircraft are working well. Important studies are continuing on the development of cross-servicing procedures and techniques so that aircraft of one NATO air force can be operated and maintained from another's bases.
INTER-SERVICE CO-ORDINATION OF SUPPORT
508. In the continuing search for economies in the support area, the Ministry of Defence has initiated studies into the practicality of making a single Service responsible for the supply of electrical and electronic equipment, and hand tools. This follows the earlier and successful rationalisation of the supply of air stores, motor transport stores, food and other ranges of materiel in common use.
509. 1977 has seen the completion of the main part of the inter-Service project to enable the next generation of supply computers to exchange data and rationalise further the support between the three Services. The project will be implemented as the new generation of ADP supply systems are introduced between now and the mid-1980s.
510. The National Economic Development Organisation (NEDO) report on the use and application of standards in engineering industries (The Warner Report) made favourable comments on standardisation work within the Ministry of Defence. British Standards are adopted whenever possible for procurement purposes, supplemented, when necessary, by a wide range of Defence Standards. The Ministry of Defence has also played an important part in establishing the new NATO Committee of Directors of Standardization which will encourage wider acceptance of standards and component specifications throughout the Alliance. The first Chairman of this Committee is the Ministry of Defence Director of Standardization.
511. The Ministry of Defence headquarters staff of the three Medical Directorates will this year be brought together in one building. Further progress has also been made with the re-organisation of Service hospitals. During the past year the RAF hospital at Wroughton was reformed as a joint RAF/Army hospital on the closure of the Military Hospital, Tidworth. The new Queen Elizabeth Military Hospital at Woolwich has been commissioned and has replaced four other military hospitals and will replace a fifth later this year. The Joint Services Medical Rehabilitation Unit at RAF Chessington will also be merged with the RAF Medical Rehabilitation Unit at RAF Headley Court in 1981. CONFIDENTIAL
RAF Hospital Cosford was closed at the end of 1977 and studies are continuing into the proposal that either RAF Hospital Ely or RAF Hospital Nocton Hall should be closed.
ROYAL NAVY SUPPORT ORGANISATION
512. Satisfactory progress has been made in achieving the staff reductions in the Fleet support organisation that were announced in the 1976 and 1977 Statements on the Defence Estimates. Several establishments will have closed by the end of the year. The Royal Navy has also decided not to retain the former RAF Thorney Island, which has been transferred to the Property Services Agency for disposal.
Naval Dockyards
513. There is more than a full programme of work available for all the Naval dockyards for the foreseeable future. For the forthcoming year a number of measures have already been taken to bring the load into better balance with available capacity, including some increase in the use of commercial ship repair facilities. First priority, however, is being given to improving dockyard productivity as a means of increasing capacity.
514. Work on guided-missile destroyers and larger ships will be concentrated at Portsmouth which also has a full supporting programme on patrol submarines and other vessels. The refitting and refuelling of nuclear submarines will remain the major tasks for Chatham and Rosyth in addition to their supporting programmes of major and normal refits of frigates, other ships and craft, and a steady programme at Rosyth on patrol submarines. Devonport will make an increasing contribution to the upkeep of nuclear submarines in addition to undertaking the major share of Leander Class frigate modernisations and other support, including, for example, the new Type 21 frigates.
**Vessels**
515. The new Fleet replenishment ship, RFA Fort Grange, will now enter service during 1978, replacing RFAs Tarbatness and Retainer. Another ship of the class, RFA Fort Austin, is under construction and will replace RFA Resurgent. The RFAs Tidereach and Empire Gull will be withdrawn during 1978. A new Royal Maritime Auxiliary Service vessel, RMA.S Throsk, was introduced into service in September 1977, replacing two old vessels and providing the principal means of coastal transport for naval armament stores.
**Automatic Data Processing**
516. The increasing use of computers in the Fleet support organisation is helping to produce greater economy and efficiency, for example, as an aid to workshop production control in the pipe and electrical shops of each of the home dockyards. Pilot schemes will investigate their possible extension to other dockyard departments. Another ADP project now under way is the direct linking of the Royal Naval Air Stations and the Naval Aircraft Repair Organisation with the Royal Air Force's central computer for air stores at Hendon. ARMY SUPPORT ORGANISATION
517. The measures to be taken for the Army's logistic restructuring, including the concentration and reduction of storeholding and repair facilities, are progressing well, and the world-wide target reduction of 5,400 civilian staff will be made by 1 April 1980. Some 45% of the manpower savings have already been achieved. Closures in the past year have included the Royal Electrical and Mechanical Engineers workshops at Killingworth in Tyne and Wear and at Coypool near Plymouth, and the regional ordnance depot at York. There has also been a substantial reduction in staff at the regional depot in Hereford. The Army Logistic Executive formally came into existence in April 1977, and its major elements have been established at Andover as the basis of an integrated logistic command and control organisation.
In August 1977 the decision was announced to close the Central Ordnance Depot, Chilwell as part of the reorganisation of the Central Ordnance Depots. Stores held at Chilwell will be transferred to Donnington and Bicester and substantial financial savings in manpower and overheads are expected when the reorganisation is completed.
518. The re-location of Army Manning and Records Offices and Regimental Pay Offices will progress significantly in 1978 so that about 60% of the relocation programme will have been achieved by the end of the year.
519. The Army has also been conducting a thorough study of its accommodation requirements. This involves taking account of certain contingencies and the distribution of units throughout the country, and reviewing all its assets including those taken over from or planned to be taken over from the Royal Air Force. This offers opportunities to make use of better and newer accommodation and to contribute to the forecast release of a substantial amount of property in 1978. Subject to the outcome of consultations with other interests involved, the surplus will include: Hopton Barracks, Devizes; Norton Manor Camp, Taunton; Chaucer Barracks, Canterbury; Haig Lines, Church Crookham; Royal Victoria Hospital, Netley; the Royal Armoured Corps Manning and Records Office, Whetstone; and Sherford Camp, Taunton. In addition, a number of miscellaneous, small properties will be put up for disposal.
ROYAL AIR FORCE SUPPORT ORGANISATION
Economy in Support Costs
520. The merger of Support and Training Commands was completed in June 1977 resulting in the closure of RAF Andover. The new integrated organisation, known as RAF Support Command, has its headquarters at RAF Brampton.
521. Proposals for the rationalisation of ground radio engineering tasks are still being considered. Support Command Signals Headquarters and the Radio Introduction Unit moved to RAF Benson in March 1977, enabling RAF Medmenham to be transferred for use by the Ministry of Defence Police Training School.
522. The transfer of engineering tasks from the Maintenance Units (MUs) at Aldergrove and Sydenham is proceeding as planned and should be complete by 31 March 1978. These transfers, together with those reported in last year's Statement on the Defence Estimates, will concentrate repair resources at the remaining MUs. In particular this will allow the centralisation of previously dispersed facilities for equipment repair at No 30 MU/RAF Sealand for avionics and at RAF St Athan for engines of fixed-wing aircraft and for mechanical components, thus further strengthening in-Service support for front-line aircraft.
523. Further improvements have been made in the use of computers to control the supply of expensive assets. The system for the control of aero-engine supply has been expanded to include all modular engines for which the Royal Air Force are responsible, and the RAF Supply Control Centre has developed techniques to improve forecasting of spares requirements for Tornado, Nimrod and Hawk aircraft. A Density Activity Complex was formally opened at No 16 MU RAF Stafford on 6 April 1977. In this complex advanced material storage and handling techniques have greatly enhanced the speed and cost-effectiveness of supply. The complex absorbed a large proportion of the stock from No 25 MU RAF Hartlebury allowing that unit to be closed in September 1977.
524. HQ Provost and Security Services (UK) and two subordinate units were amalgamated and relocated at RAF Rudloe Manor.
525. The Officers' and Aircrew Selection Centre at RAF Biggin Hill will move to RAF Bentley Priory in 1981, and most of the land and buildings still held by the Royal Air Force at Biggin Hill will be sold. A small enclave, including the Battle of Britain Memorial Chapel and the Officers' Mess which will accommodate the RAF Chaplains' School transferred from Amport House, Andover will, however, be retained. This will preserve a link between the Royal Air Force and Biggin Hill which has played such a prominent role in RAF history.
LANDS
526. The Ministry of Defence has continued to reduce its holdings of land in keeping with its established policy of disposing of all property for which there is no foreseeable defence requirement. The area of land held on leasehold and freehold was reduced by a further 4,500 acres in the year ended 30 September 1977, making a total of 33,400 acres over the five years up to that date, and the process of contraction and redeployment resulting from the Defence Review will enable the release of more land in 1978.
527. With one exception, all the recommendations in the report of the non-statutory inquiry conducted in 1975/76 by Baroness Sharp into the continued use of Dartmoor for military training have been accepted in principle and are receiving detailed consideration.
528. Continuing attention is given to the need for conservation on defence lands. Nearly 100 Service conservation groups have been formed and valuable links with external organisations and societies are maintained. LIVING ACCOMMODATION
529. Single and married quarters in the United Kingdom and overseas are continuously improved to bring them up to modern standards although in certain areas, such as Northern Ireland and Belize, operational considerations constrain the standards that can be achieved. Progress is also necessarily affected by wider budgetary considerations, and has been slower in the last year than originally planned. It is proposed to begin an extended programme of thermal insulation of married quarters, including the filling of wall cavities where appropriate.
530. The hire of married quarters for all three Services will cost about £43 million in 1978/79. Most of the expenditure is incurred in West Germany where an increase of about 1,000 hirings is foreseen although the number of hirings worldwide is expected to be about the same as in 1977/78.
531. The number of married quarters in the United Kingdom continues to be reduced in step with the fall in demand that has been a feature of recent years. This trend is producing an unavoidable but disturbing level of vacant married quarters. To keep this level to the minimum, quarters are passed to the Property Services Agency for disposal as soon as it is clear that there is no long-term need for them. In the year ended 31 October 1977 some 1,600 quarters were declared surplus to requirements. Where it is essential to retain vacant quarters for any significant period against future requirements, temporary uses are sought including leasing agreements with local housing authorities. WORKS
532. About half the works budget is spent on new construction, and priority is given to work required to permit the introduction of new weapons systems and other operational requirements, reorganisation and high priority training. Thus the major features of the programme will consist of the continued modernisation of naval bases and training establishments; the Army's restructuring and continuous improvement of the Army's estate; the introduction of the Tornado aircraft; and the rationalisation of the R & D establishments. The remainder of the works budget is spent on maintenance including some large projects such as airfield pavement resurfacing.
533. Next year an additional £8 million will be spent as part of the Government's measures to assist the construction industry. This will be spent mainly on further projects to improve the Army's living and working accommodation; projects affecting operational requirements and safety measures; measures designed to conserve energy; and a large number of relatively small but important jobs to improve the condition of the defence estate.
ENERGY CONSERVATION
534. Energy consumption during 1976/77 has continued to be closely monitored and savings of approximately 10% over consumption of the early 1970's have been achieved for the third year. in succession. At one Royal Ordnance Factory substantial progress has been made towards a target saving of 25% in steam-raising by modifying control systems and other means. One R & D establishment has been able to reduce its fuel bill by some 30% by changing the type of fuel burnt and three Ordnance Depots in BAOR have between them saved nearly two million litres of furnace fuel oil in the last year by a combination of good housekeeping, technical improvements and better use of buildings. The Royal Air Force has replaced the heating systems in three hangars at a major operational unit and this should reduce operating costs by 60% enabling the capital cost to be recovered in less than two years.
MOVEMENTS
535. The Royal Fleet Auxiliary logistic landing ships and overseas store carriers fill a major role in meeting the freighting requirements to and from our Service establishments abroad, including the initial stages of the important task of running down the Malta base. In addition they have been engaged in the movements tasks associated with military exercises. A logistic landing ship is due to start a regular schedule every 4-5 days between Marchwood military port and continental Europe in early 1978 and this will further improve military container distribution.
536. Simplified and more economical procedures for the movement of RAF air and surface cargo were introduced during the year, providing substantial cost savings.
537. Fluctuations in force levels in Northern Ireland and the reinforcement of Belize during 1977 have made additional calls on movement resources but without detriment to the overall scheduled movement of passengers and cargo by air.
METEOROLOGY
538. Although the Royal Air Force, Civil Aviation and the general public remain their principal customers, the Meteorological Office's services have been expanding in several other areas notably in support of agriculture and the off-shore oil industry. Special procedures have also been developed to support the routine operations by Concorde aircraft. The revenue earned by the Meteorological Office from all sources now amounts to about one third of the total expenditure.
539. Two ocean weather ships have been extensively refitted to enable the United Kingdom to maintain observations at one station in the reduced four-station network of the present North Atlantic Ocean Station scheme.
540. The further development of the satellite-receiving station at Lasham has continued in collaboration with the Royal Aircraft Establishment at Farnborough. The station is providing a valuable service for both forecasting and research in the form of data from existing meteorological satellites, and will be able to receive data from future satellites including the European meteorological satellite METEOSAT.
541. Research activity designed to support all the services provided by the Meteorological Office, has continued covering a large number of subjects and in particular special attention has been given to questions affecting aircraft safety, such as wind shears at low levels and the icing of helicopters.
OTHER SUPPORT
Management Review
542. Many of the major recommendations of the Management Review of the Ministry of Defence headquarters have now been implemented including the proposed reduction in the number of Accounting Officers from six to two and the closer integration of several Procurement Executive functions with those of the rest of the Ministry.
543. It has been decided not to proceed with the proposal, announced in last year's Statement on the Defence Estimates, that the post of Chief of Personnel and Logistics should lapse. The Chief of Personnel and Logistics will, instead, assume certain responsibilities previously discharged by the Vice Chief of Defence Staff. The post will be re-titled Vice Chief of Defence Staff (Personnel and Logistics), and will carry membership of the Defence Council. The post of Vice Chief of Defence Staff will lapse.
Manpower Savings
544. The number of Ministry of Defence civilians for whom provision has been made in the Defence Estimates is 269,500 on 1 April 1978 and 264,000 on 31 March 1979. In addition some 23,500 are employed in the Royal Ordnance Factories; their costs are met from the Trading Fund. In the period 1964 to 1974 civilian strengths were reduced by 114,000 on a broadly comparable basis. By April 1979 the number of civilians working in the Ministry of Defence, including Property Services Agency staff working on behalf of the Ministry, is expected to show a reduction of 40,000 on 1974 strengths after allowance for organisational changes which have taken place meanwhile. During 1978/79 numbers are expected to fall by 5,500, including headquarters staffs. This is the final stage in the achievement of the reduced civilian manpower targets set as part of the 1974 Defence Review and the subsequent expenditure reviews in 1975 and 1976. The rundown will have been carried through with the minimum of compulsory redundancy.
The combined Service and civilian reductions in headquarters staff arising out of the Management and expenditure reviews should result in savings approaching 9 to 10% of 1974 headquarters numbers by April 1979. The intention is to find still further economies by the early 1980's, including savings in senior posts.
Apprentice training
The Ministry of Defence continues to train significant numbers of civilian apprentices. The entry for 1977 was about 2,000 and there are now some 7,500 young men in training. The Ministry thus has roughly one apprentice for every five craftsmen compared with the ratio of one to nine in industry generally. Nevertheless the problem of recruiting skilled men continues, a reflection of the general shortage of skilled men. The Ministry therefore intends to expand the apprentices entry in the coming year. Dispersal
547. Forward planning to meet the Ministry's commitments under the Government's dispersal programme is going ahead. The programme involves the dispersal of some 4,250 Ministry of Defence posts to Cardiff by 1983/84 and up to 5,500 to two locations in Glasgow, 1,500 posts by 1983/84 and the remainder by 1985/86 - 1987/88. After the dispersals, the bulk of the Ministry's procurement policy work will be concentrated in the west of England and south Wales, while Glasgow will become another major administrative centre. INTRODUCTION
548. In this paper I seek to give my colleagues a first and necessarily only general view of the prospect and problems before us. We will be able to consider these matters in more depth and detail in a few weeks, when we shall have the new economic forecasts and can assess their implications. That will be the time to form a judgment on the appropriate size of fiscal stimulus for the spring Budget, and to choose between the range of methods available for producing it. It would not be profitable at this stage for us to discuss precise figures (of the kind suggested by the Secretary of State for Social Services and the Minister for Social Security - see Annex to this paper), which would have to be plucked largely out of the air.
549. This paper therefore concentrates rather on the background to the Budget and the relationship between our various objectives, and discusses some of the uncertainties which will inevitably surround the decisions we shall ultimately make.
DEVELOPMENTS SINCE THE OCTOBER MEASURES
3. The object of the October measures was to produce more jobs and investment by building on our dramatic financial recovery to promote a corresponding recovery in the real economy. We described the measures as part of a programme of economic recovery spreading over 18 months. It may be helpful, therefore, to begin by reviewing developments in the economy since October, and noting how these have differed from the projections which we published at that time.
4. Since October, some trends have begun to establish themselves more clearly, but great uncertainties remain. There are three areas, in particular, where events have developed differently from what we then projected. Sterling has come under greater upward pressures than we expected - largely as a consequence of the weak dollar - and has appreciated 5 per cent. The increase in earnings during this pay round so far has been a little above the 10 per cent guidelines. Though this is better than we might have feared it is still well above the rate of increase among our main competitors, who also enjoy a higher growth in productivity than we do. The latest figures suggest that the increase in unit labour costs this year will be increasing at between 4½ and 5 per cent in our main competitors and well over twice as fast in the United Kingdom. World trade has been increasing very slowly: forecasts of economic growth this year have been revised downwards; and only in North America can we expect actual expansion to keep pace with the potential for growth.
5. Looking ahead, there is a very good chance now that we shall see single figure inflation right through the year, if our incomes policy holds at least as well as it has done so far, and there is no sharp fall in the sterling exchange rate. On the other hand, it is probably unrealistic to expect to hold the rate of inflation at this level far into 1979, if earnings continue to increase at their present rate; and we should be facing very serious dangers once again, if wage increases were to accelerate and confidence in sterling were shaken.
6. Taken together, these factors probably indicate that (in the absence of further fiscal action) we must now expect a growth rate lower than the 3½ per cent which we projected on the assumptions of last October, but also a worse balance of payments. The function of the spring Budget must, therefore, be to stimulate demand in a way which produces and sustains more domestic output, and thus produces more jobs. If we failed to control the inflationary pressures, which may build up as we move into 1979, we would risk cutting short the recovery in its early stages. This in turn has implications for the size of the fiscal stimulus which we can afford to give, without prejudicing our own objectives. If we were to lose the confidence of the financial markets, this would bring the familiar destructive consequences for our hopes of increased investment, for financing our domestic borrowing requirement and for the value of sterling. So we need to keep a limit on the public sector borrowing requirement and to keep control of the monetary aggregates.
7. Even with North Sea oil flowing, the balance of payments will not look after itself. To expand domestic demand at a rate which would push the current account into deficit would itself be a severe blow to confidence. It would also cause major problems in another area of particular importance - that of our overseas debts. My objective is to spread out our debt repayments over a much longer period - so as to minimise what could otherwise be a troublesome constraint on our ability to maximise our rate of growth. This means undertaking a programme of new borrowing overseas, in order to finance the repayment of our existing debts as they mature. For this purpose we need to run a balance of payments surplus over the next few years which is sufficient to maintain our credit in overseas financial markets.
8. In brief, we need to set the right intermediate objectives for the money supply, the public sector borrowing requirement and the balance of payments, if we are to increase our domestic output and employment to the maximum. The way in which we expand domestic demand will to a significant extent determine the amount by which we can effectively expand domestic output. For reasons which I explain later in this note (and despite what is said in CP(78)10) in the present situation tax cuts will help us more than a further addition to public expenditure.
MAIN AREAS OF UNCERTAINTY
09. There is great uncertainty, and wide disagreement among economists, not only about the course of growth, employment, and inflation in Britain over the next year or so, but also about changes that seem to be taking place in previously established economic relationships and in the effectiveness of the policy instruments available.
10. First, the exchange rate. According to a view held by many economists, an appreciation of the exchange rate will in due course bring about a significant and measurable worsening in the balance of payments and the level of domestic activity - though there will be a long lag before the full effects come through and (other things being equal) after a further lag the effects will eventually wear off as inflation comes down. This is the converse of the well-known J-curve resulting from depreciation. Such economists acknowledge that there is a great uncertainty about the length of the lags - how long it will be before the full effects come through on the domestic economy, and how long it will be before the effects subsequently wear off. As against that, quite apart from the school of monetarists which believes that appreciation does much more good than harm, other economists, while they accept the broad analysis described above, believe that a strong domestic currency will produce benefits on inflation and improve confidence more generally, to a degree which may make it worth accepting the adverse effects of an exchange rate appreciation. Here again there is great uncertainty about the speed with which the beneficial effects will come through, and therefore about the size and duration of the transitional costs - particularly in terms of unemployment and the balance of payments.
11. In any case, there is general agreement that the power of Governments to control the course of the exchange rate is strictly limited. The volume of funds which can be moved across the exchanges is much greater than Governments can offset for more than a short period of time. In our case the effects of North Sea oil are likely to mean that the exchange rate will be higher for the next few years than it would have been otherwise. How the exchange rate moves from its present level will depend on the development of the economy as a whole, of which North Sea oil forms an important, but minor part.
12. Second, unemployment. Over the 12 months to September 1977 domestic output probably increased very little. The labour force increased by nearly ¾ million. Yet employment rose by 100,000 mainly in manufacturing industry; unemployment rose by 150,000 (indeed only 90,000 over 1977 as a whole). Unfilled vacancies rose by 20,000; this January they are higher than at any time since March 1975. No-one in or out of the Government predicted this combination of events. It is impossible to be sure what it implies for the future. If these relationships continue to apply then a growth rate of some 3 per cent would bring about a steady and lasting fall in unemployment sooner than the traditional arithmetic would suggest. Alternatively, it may be that our special employment measures last year had more effect than we predicted, and that employers for their own reasons have been holding on to a larger labour force than they need for current production; if that were the case, it could on the contrary dampen the effect on employment of this year's acceleration in the growth rate.
13. Third, investment. We are all agreed on the need to see more profitable investment in productive industry. But there is no such general agreement on how best to achieve this. What is clear is that the readiness of industrialists to invest depends in part on their general state of confidence, in part on their belief that the demand for their products will be sustained at a level above their existing capacity to supply them, and in part on their having a level of profitability which will provide adequate funds for investment now, and reasonable expectations of an adequate return on that investment in the future. In fact private manufacturing investment was 13 per cent higher in the first nine months of 1977 compared with the same period in 1976.
ASSESSMENT
14. Whatever view one takes of these uncertainties, one thing is certain. If we stimulate demand to a degree which seriously outstrips the ability of domestic industry to supply it - either because we are unable to expand output quickly enough, or because we are not sufficiently competitive in price or quality - then the excess demand will result in excessive imports and greater inflationary pressures. These in turn will drive down the exchange rate - possibly drastically if confidence evaporates - and any immediate benefit to the current balance would be wiped out by the consequences of higher inflation. The result would be higher unemployment and a further erosion of our manufacturing base.
15. General import controls would provide no easy escape from that danger. First, to the extent that we succeeded in keeping out imports, the immediate effect could only be to increase inflation further. Second, in practice, as a large net exporter of manufactures, we could only improve our net balance of external trade, if we avoided damaging retaliation by other countries. We would have to win the consent of our major trading partners; indeed, under the Treaty of Rome we have no legal power to enforce general import controls, without the consent of the Community. In our present circumstances there is no prospect of gaining this consent: they have much the same unemployment problems as we do; and they would regard it as particularly provocative of us to attempt to export our unemployment to them, at a time when unlike them we are enjoying the unique benefits of North Sea oil.
16. Thus, if we are to stimulate domestic demand in a way which maximises domestic output and employment - rather than imports and inflation we must do everything that we can to increase the volume and competitiveness of production in Britain. This depends on many factors. It is not just a question of earnings and the exchange rate; some of us believe that policy has in the past given undue emphasis to these aspects. In the long run, the key to competitiveness is the difference between increases in earnings and increases in productivity - we must ensure that this difference is no wider in Britain than among our major trade competitors. We can achieve this objective just as well in principle, and a great deal more profitably in practice, with high earnings and high productivity growth as with low earnings and low productivity growth. If we cannot get the former, we must settle for the latter. What we cannot afford is high earnings, but continuing low productivity. That is why we have identified productivity as the prime objective of the industrial strategy, both in the directly industrial work being carried forward by the Sector Working Parties and in our discussion of the wider aspects (CM(77) 34th Conclusions, 27 October 1977). It must remain a central objective for the whole of Government policy in the coming years.
17. Meanwhile, however - given the strict limits on Government's power to influence either productivity or the exchange rate, there is no escape from the fact that we must reduce the rate of growth of money incomes. Wage costs remain the key to competitiveness in the short term. For the coming year, therefore, I believe that we should concentrate the room for fiscal manoeuvre which we deliberately left last autumn mainly on reductions in the burden of income tax: and this is where the Trades Union Congress also have put their first priority. For public expenditure we ought to stick to plans we have just published - including the £1 billion increase which we announced last October. So we must keep any further increases we feel are inescapable within the margin provided by the contingency reserve. The case for concentrating on tax relief at this stage is overwhelming. It will not only provide the steady and sustained expansion of demand, which is needed to supply the essential incentive for new investment, but will also strengthen the incentives for better performance by industry and our export services. Above all, it will create the conditions in which we can realistically expect working people in the next pay round to settle for earnings increases well within single figures. It will give them confidence that they can get a worthwhile increase in their living standards without demanding increase in money wages so high as to send prices and unemployment shooting up again.
D W H
Treasury Chambers 31 January 1978 Since originally drafting this note, I have seen the paper by the Secretary of State for Social Services (CP(78)10). We can discuss his detailed expenditure proposals at the proper time. However, it may be helpful if I make three general comments now.
2. First, the Secretary of State does not explain the basis on which he has chosen £3 billion as the correct fiscal stimulus in my spring Budget. As I have explained above, this is not a figure which we can pluck out of the air. It must take account of the implications for domestic output, for inflation and the monetary aggregates, and for the balance of payments. It thus requires a major economic and political judgement which can be made only after we have had the best available picture of the economic prospect including the new short term forecast, the latest indication of pay settlements over the round, and some idea of what is happening to the savings ratio.
3. Second, the Secretary of State makes much of 'unplanned deflation' in 1977 'due to massive shortfall in public spending'. Certainly there seems likely to be an undesirably big shortfall in 1977/78 in our spending programmes, as conventionally measured (in survey prices) in the Public Expenditure White Paper. However, it is important to keep this in proportion. Shortfall is not a new phenomenon and it has therefore consistently been provided for in our economic and Budget planning, as reflected (for example) in the annual Financial Statement and Budget Report (FSBR). In the latest year for which we have firm figures - 1976/77 - the total cash outturn on public expenditure was within some £100 million of the total provided for on this basis in the 1976 FSBR, and reflected in the estimates of the public sector borrowing requirement which we published at the time of the 1976 Budget. We do not yet have a firm estimate for this year's outturn (1977/78). However, the latest indications are that, discounting the changes in export credit financing, which do not reflect changes in real activity, the shortfall on this basis is likely to come out at something under £500 million - or well under 1 per cent.
4. Third, the Secretary of State suggests that some forms of public expenditure have the same broad economic effects as tax cuts. This is true only of some forms of expenditure, and then only to a limited extent. Thus, increases in child benefits can certainly stimulate demand and have some helpful effect on incentives in the area of the poverty trap, similar to increases in tax thresholds. However, they are unlikely to make the same contribution to our pay and counter-inflation policies, by buttressing the real take home pay of those at work. Indeed, the whole point of taking child tax allowances away from fathers, and substituting a child benefit payable to mothers, is that in many families husband and wife do not share and share alike their several incomes; and this is precisely the point which originally worried the TUC and persuaded us to phase in child benefits over a period of time. CABINET
DRAFT WHITE PAPER ON THE NATIONALISED INDUSTRIES
Note by the Chancellor of the Exchequer
1. I attach a draft White Paper on the nationalised industries. It replies to the highly critical report which the National Economic Development Office published in November 1976 and to the National Consumer Council's report of August 1976 on "Consumers and the Nationalised Industries".
2. Following discussion by the Ministerial Committee on Economic Strategy (EY), paragraph 54 on future price increases has been amended, and a reference to the work of the Select Committee on Procedure has been added to the end of paragraph 93. Apart from these two points EY approved the draft. This draft now includes, in paragraph 29, a brief reference to the industrial democracy White Paper and, at the end of paragraph 20, a reference to the fact that the Electricity and Nuclear Materials Bill includes a provision to enable specific directions to be given to the electricity supply industry.
3. With the other Ministers concerned, I discussed the main proposals in July with the Nationalised Industries' Chairmen's Group. Since then some new ideas have been introduced and I recommend that, before the White Paper is published, each sponsoring Minister should send the chairmen of his industries a summary of the main points. I will arrange for the Official Committee on Nationalised Industry Policy to prepare this.
4. I invite the Cabinet to agree that the White Paper should be published in March, after the chairmen of the industries have had an opportunity to see the summary and with any minor amendments necessary to keep it up to date.
D W H
Treasury Chambers
2 February 1978 Contents
Introduction
INSTITUTIONAL ARRANGEMENTS
12-19 Board structure: rejects the NEDO's proposed Policy Councils and Corporation Boards
20-22 New powers to give specific directions, and compensation when necessary
23-25 Pay and appointments of Board Members
26-27 Composition of boards, including civil servant members
28-29 Industrial democracy
30-39 Consumer councils
40 Other consultative arrangements eg Energy Commission
41-42 Relations with suppliers
43-47 Corporate plans and investment and financing reviews
48-51 Monitoring
THE FINANCIAL AND ECONOMIC FRAMEWORK
52-57 General
58-65 Investment and the opportunity cost of capital: introduces the 5% Required Rate of Return (see also Appendix I)
66-68 Pricing policy
69-75 Financial targets
76-78 Performance indicators
79-82 Cash limits
83-85 Capital structure and sources of finance: general points
86-88 Public dividend capital
89 Financing the British National Oil Corporation
90-92 Loans from the NLF
93 Conclusions APPENDICES
I
The RRR: 1-12 discuss the system; 13-19 the 5% number
II
List of financial targets already set
III
Explanatory section on NLF and foreign currency borrowing I INTRODUCTION
1. This White Paper replies to the recommendations in the report of November 1976 by the National Economic Development Office, "A study of UK Nationalised Industries: their role in the economy and control in the future." It takes into account the Government's proposals for developing industrial democracy in the nationalised industries, and it explains the Government's main proposals in response to the report of August 1976 by the National Consumer Council on "Consumers and the Nationalised Industries".
2. The White Paper is about the control of the nationalised industries, their financial and economic objectives, and their relations with government. It sets out proposals designed to reconcile the purposes of public ownership with the independence needed for vigorous and enterprising management; and to ensure that the nationalised industries employ resources efficiently to the benefit of the whole community. Section II describes a number of institutional changes intended to improve the relationship between the nationalised industries and Government, unions, customers and suppliers. It explains how information on the industries' main objectives, agreed after discussion between the Government and the boards, and on their performance will be published. Section III discusses the financial and economic framework within which the industries will operate, and in particular the role of the financial targets which will be published for all the industries and used as a measure of their success.
3. The central problem in evolving an acceptable relationship between the Government and the nationalised industries has always been how best to reconcile the boards' need for sufficient freedom to manage the industries with the Government's legitimate interests in them. The Government must be concerned in the strategies, and operational decisions of public importance, of industries which are basic to the national economy; in seeing that these industries, which are not subject to the private sector discipline of the threat of bankruptcy, and are in some cases relatively free from market pressures, are efficient; and in ensuring that there is an acceptable return on the public capital invested in them.
4. The last general review of the economic and financial principles common to all nationalised industries was the White Paper of 1967, "Nationalised Industries: a review of economic and financial objectives," Cmnd 3437. That White Paper was intended to show how investment, pricing and efficiency policies would be taken into account in setting financial objectives, rather than to make any change in the basic relationship between the Government and the nationalised industries. It explained that, subject to allowance where necessary for social objectives or for meeting statutory obligations, it was the Government's policy to treat the nationalised industries as commercial bodies so far as the expected return on investment was concerned. It set out criteria for investment appraisal and pricing policy, which were intended to ensure that the nationalised industries did not claim resources which could have been put to better use in other parts of the economy. It stressed the importance of setting the industries clear financial targets which would serve both as an incentive to management and as one of the standards by which success or failure would be judged.
5. These principles were endorsed by the Select Committee on Nationalised Industries and generally accepted as setting a sound basis for future relations and control. In practice, however, the new approach did not last, and in the first half of the 1970s the relations between governments and the industries deteriorated. This arose in part because of disagreements and uncertainty over the plans of particular industries. But, the main single factor which undermined the principles in the 1967 White Paper was the price restraint policies of the early 1970s. The Post Office and the gas and electricity industries were forced into deficit and for the first time ever had to be subsidised to cover their losses, which totalled £1182 million over the period. The grants which were already being paid to British Rail escalated as their fares and charges were held down and their deficit increased. As a result of these policies, the financial targets of most of the nationalised industries had to be abandoned and there was little chance to put the 1967 principles to the test.
6. In its report of December 1973, "Capital Investment Procedures", the SCNI concluded that government had failed to meet its objective "of exercising its control publicly and according to well-defined ground rules, without interfering with the management functions of the industries themselves". The Committee accordingly recommended that the Government should arrange for "a detailed study of the role of the nationalised industries in the economy and of the way in which they are to be controlled in the future".
7. In June 1975, in its reply to the SCNI's report, the Government announced that it had asked the NEDO to undertake this enquiry. The NEDO published their report on 18 November 1976. It is a searching and highly critical examination of the relations between the industries and governments. In his introduction to the report, the Director General of the NEDO writes:
"Our enquiry has left us in no doubt that the existing framework of relationships, developed under governments of both main political parties, is unsatisfactory and in need of radical change".
8. Many of the industries, in their written evidence to the Select Committee on Nationalised Industries, generally agree with the NEDO's analysis of the problems. Some comment that their relations with their sponsoring departments have always been generally good and others agree that they have recently improved. Indeed the NEDO acknowledge that their criticisms do not apply to relationships with all the nationalised industries or for all the time to particular industries. The Government agrees, nevertheless, with their general conclusion that relations had deteriorated in the period up to the mid-1970s and needed to be improved. The NEDO present a perceptive and thoughtful analysis of the problems and, while the Government does not accept all their proposals, it welcomes their report as offering a basis on which both the Government and the industries can now build.
The Government's general approach
9. In 1974 the Government set out to put the nationalised industries back on to a sound economic and financial footing. This required substantial price increases to phase out the subsidies necessitated by price restraint, described in paragraph 5 above.
\*Published by the SCNI in their Second Special Report of 1976-77, (HC 345), "Comments by Nationalised Industries on the NEDO Report." As a result, they are generally in a much stronger financial position than they have been for a number of years. The period of rapid price increases needed to deal with the deficits due to price restraint in the early 1970s is over. A more stable, and better, climate of relationship has been established and it is, therefore, now timely to review, and where necessary develop, the principles in the 1967 White Paper. The Government considers that this review, together with the other measures discussed in this White Paper, will lay the foundations for further improvement.
10. An important point which must be emphasised from the beginning is that apart from the fact of public ownership and control many of the nationalised industries have little in common. They vary in size, objectives, markets, financial strength, and social significance. The individual energy and transport industries are subject to overall policies for the sectors in which they operate. The formation of the two new manufacturing corporations, British Aerospace and British Shipbuilders, brings about a further significant shift in the balance of the nationalised industries away from the historical predominance of the public utilities serving a British market. The three manufacturing industries - Steel, Aerospace and Shipbuilding - together with British Airways and the British National Oil Corporation all operate in highly competitive international markets with their prices largely set by international trading conditions. It is important that these industries, and indeed those which are competing in domestic markets, are able to respond quickly to opportunities and competitive forces and that the Government's arrangements with them should recognise this. It follows that, while there are a number of important principles of wide application, it is essential throughout to take account of the varying circumstances of the different industries and to be ready to find solutions and a frame- of control appropriate to the particular needs and market situations of each of them. This need for a flexible approach to match circumstances is recognised by the NEDO.
11. The NEDO discuss in some detail the crucial question whether the Government should aim to stand back from the industries, and operate an "arms-length" relationship, or whether it should be involved more closely. Their conclusions on this are worth quoting:
"It seems to us that the thinking behind the wholly arm's length approach is based on a false analogy with the private sector. The financial structures and disciplines in the public and private sectors are very different - not least because the ultimate sanction of liquidation is in practice absent in the major nationalised industries. Moreover, their importance as employers, suppliers and customers, and the economic and social implications of their actions make it right as well as inevitable that government should take a close interest in their strategies. The issues of public policy involved are so large and politically sensitive that it is not realistic to suppose that they would ever be left for long to management alone to determine, subject only to periodic checks on their financial performance."
The Government agrees with this. The question is how best to construct with each industry a relationship which is sufficiently close, but in which the responsibilities and objectives of both the Government and the industry are well defined and well understood. Board Structure
12. The NEDO recommend a radical change in the current institutional arrangements. As a general approach, but with modifications to suit circumstances, they propose that each nationalised industry should be run by a Policy Council responsible for strategy and a Corporation Board acting as the executive authority. The Policy Council would be under a President of high personal standing, and preferably a part-time. It would include the Chairman and some members of the Corporation Board, representatives of the main interest groups concerned with the industry - Government Departments, trade unions, and customers - and also members reflecting other independent viewpoints. It would be supported by a small staff seconded from departments, the Corporation and trade unions. Its main functions would be to agree corporate objectives and the strategies to achieve them; to establish performance criteria; to endorse corporate plans; and to monitor performance.
13. The Corporation Board would manage the industry within the framework of these objectives, strategies and criteria. One of the main roles of the President of the Policy Council would be to protect the Corporation Board, which would have a separate Chairman, from intervention by Government in carrying out its responsibilities. The Policy Council would appoint the Chairman and members of the Board.
14. The Government agrees that, in dealing with the nationalised industries, its main concern should be with strategic and major issues rather than day-to-day management. It also generally accepts NEDO's argument that the evolution of strategic plans for nationalised industries should be a combined operation, involving the interest groups which are closely concerned with their content and implementation and which often have the power to frustrate them if they wish. However, the Government does not accept that NEDO's proposal for Policy Councils and Corporation Boards is the best way of achieving these objectives and of improving its relations with the industries.
15. Before reaching this conclusion the Government discussed the proposal with the nationalised industries, and took account of the comments in their published evidence to the SCNI. None of the industries favours - and some reject in very, strong terms - the proposal for a Policy Council standing in line of command between the Minister and an executive Board which runs the industry. They assume that Ministers would not delegate their present powers, or concern with matters of major importance, to the Policy Council (and this appears to be implicit in the NEDO's proposal if it were to achieve the desired objective of limiting Ministerial intervention). This assumption is right. The Government is the sole shareholder of the nationalised industries, and their principal banker; and, as the NEDO acknowledge, the industries' strategies and main policy decisions involve questions of major political and public importance with which the Government must be concerned.
16. The Government believes that, contrary to the NEDO's objectives, these arrangements would slow down the process of decision making and would confuse responsibility and accountability. The Minister and the Policy Council would both be concerned with strategic and major issues. The functions of the Policy Council and the Corporation Board would overlap because, as many of the industries have pointed out, the distinction between strategic and executive decisions is not in practice always as sharp and as clear cut as NEDO's proposals imply. Thus, the Government, the Policy Council and the Corporation Board could all be concerned with strategic and major issues, and instead of clarifying responsibilities and streamlining decisions, the NEDO's Proposals would add an additional layer of authority, expressed in legislation, in a Policy Council whose own responsibilities would in practice have unclear demarcation lines.
17. A number of the nationalised industries have also pointed out that their present boards are supported by management committees which deal with many of the day to day issues involved in the running of the business. These arrangements are flexible and tailored to the requirements of the particular industry whose Chairman can readily modify them if necessary. They are, however, fundamentally different from a statutory two tier structure, with the powers and functions of the senior board "explicitly and formally distinguished from those of executive management," as proposed by NEDO.
18. In their paper of November 1977 to the SCNI, the NEDO have criticised the industries' reactions to their proposal for Policy Councils and Corporation Boards. They argue that it is unacceptable for the industries to agree generally with their analysis of the failings of the arrangements in the past but to reject any proposals for structural or other changes to ensure a better and more stable relationship in future. While the Government recognises the deficiencies which led the NEDO to make their recommendations, many have been overcome since NEDO conducted their study and the Government does not agree that it follows that major structural changes in the boards are a necessary condition of maintaining the recent improvement in relationships.
19. The fact that the Government does not intend to introduce Policy Councils and Corporation Boards does not mean, however, that it rejects the argument that changes are necessary to bring about further improvements. The Government is already developing a number of new arrangements on the lines proposed by NEDO, and it will now introduce others. Later parts of this Section explain the various ways in which the main interest groups concerned with the industries will be more involved in the formulation of their policies, either by board membership or by improved consultative and participative arrangements. The procedures for the discussion of corporate plans are being developed with the aim of giving them a central place in the relationship between the nationalised industries and the sponsoring departments, and of providing a systematic framework for reaching agreement on long term objectives and strategies. Information on these plans, on financial targets and any sectoral or social objectives set to the industries, on cash limits, and on performance and service indicators and aims will be published in the industries' annual reports and accounts. These arrangements, and the proposed new power to give specific directions where necessary, will help to clarify the respective roles of the Boards and the Government, and they will provide a better basis for Parliament and the public to judge the performance of the industries and the role of the Government in their operations. New Powers to issue specific directions to Boards
20. The present statutes empower the Secretary of State to give the Boards directions of "a general character" on matters which appear to him to affect the national interest and, in some cases, directions on particular subjects which are specified in the statutes. However, the power to give general directions does not allow the Secretary of State to direct an individual industry on a particular matter, however important, unless that particular power of direction is specified in the statutes. In the absence of powers to give specific directions, governments have had to rely on a process of persuasion. Because this has been informal, accountability for decisions has on occasions been blurred and this has caused friction and resentment. The Government considers that this situation should be avoided, and that it is wrong in principle that a Minister cannot statutorily intervene in specific matters subject to the approval of Parliament. It agrees, therefore, with NEDO that the present powers should be extended to remedy this deficiency by enabling the Minister to give a Board either general or specific directions on matters which appeared to him to affect the national interest. An important advantage of the new power would be that when a direction was given it would clarify accountability by indicating formally and publicly where the Government had decided to overrule a Board's judgement or to direct it to do something in the national interest. The Government will put forward and in the case of the proposals accordingly for amendment of the statutes, Electricity Supply industry it has included a provision in the Electricity and Nuclear Materials Bill introduced in February. These legislative proposals will include a number of safeguards. A Minister would not be able to issue a specific direction before he has consulted the industry in question. The direction would be in the form of a statutory instrument, subject to Parliamentary procedures. The Minister would be required to publish, when the statutory instrument was presented, an estimate of the extra cost if any to the industry of implementing the direction. If the industry did not agree with this, their estimate would be published with the Government's comments on it. Compensation would be paid to cover the extra cost and the legislation would provide for this. There would also be powers to override, where necessary and subject to European Community obligations, any other statutory duties with which the specific direction might conflict. It would not be possible to make a specific direction which would have the effect of extending or restricting the existing statutory powers of an industry; that would be a matter for new primary legislation.
21. If Parliament approves these powers the Government intends to use them sparingly. One of the themes running through this White Paper is that the relationship between governments and nationalised industries is close; and there will continue to be many issues on which the industries and the Government will reach agreement without the issue of specific directions and without any confusion of responsibility or accountability. Moreover, Ministers do not intend that, as a result of the availability of this power, they should be drawn into detailed intervention or Parliamentary discussion of a multitude of matters of day to day management, which should in principle, and must in practice, be left to those responsible for managing and running these industries without the intervention of Ministers or Parliament. Pay and appointment of board members
22. When the Review Body on Top Salaries in their Sixth Report recommended revised salaries for nationalised industry Board Members and Chairmen for 1 January 1975 the Government deferred a decision on the recommendations for wider policy reasons. As a result the pay of Board Members and Chairmen has fallen sharply in real terms, far more so relatively than that of most other people, and there are anomalies in the pay structure in many of the industries with board members earning less than some senior staff working for them.
23. On 15 December the Government announced that the most that could be allowed at the present time was a 5% general increase from 1 January 1978, with up to 10% for the less well paid board members tapered to ensure that the 5% applied above £13,000 a year. In reaching this decision the Government had regard to the measures still being taken in the national interest to control inflation which continue to demand considerable restraint from all sections of the community. The Government recognised that this still leaves nationalised industry board members significantly out of line with their counterparts, and it will look again at the way forward when the Review Body on Top Salaries makes its next recommendations for April 1978.
24. All appointments to Boards will continue to be made by the responsible Minister who will consult the Chairman of the industry concerned on each appointment, and call on the Public Appointments Unit in the Civil Service Department when appropriate. A number of the industries have been critical of delays in filling vacancies on the boards. This is sometimes unavoidable but the Government readily accepts that the aim must be to avoid delays wherever possible. The composition of boards
25. The composition of each board will be settled on an industry by industry basis by the Ministers concerned after discussion with the Chairmen. The Government's proposals for the appointment of employee representatives are explained in paragraphs 28 and 29 on industrial democracy; and, as pointed out in paragraph 30, consumer members will be appointed to some boards. The Government will continue to appoint part-time non-executive members who are not representative of interest groups but who have the experience to make an important contribution to the running of the industries.
26. The Government has also decided that in some industries a civil servant from the sponsoring department, and in a few cases from the Treasury too, will be appointed to boards after consultation with the Chairmen concerned. The purpose is to give the department a clearer understanding of the industry, and a better insight into its problems; but the Government also recognises that in the different circumstances of the various industries appointment of civil servants to the boards will not necessarily be the best way of securing this result in every industry. It will, however, be worthwhile where it means that the Government can be aware at an earlier stage than now of the thinking of the boards and, for their part, the boards can have a clearer view, at a formative stage of their planning, of the wider objectives and implications of Government policy. There is a potential difficulty arising from the dual allegiance which a civil servant would have to his Minister on the one hand and as a board member sharing the corporate responsibility of the Board on the other hand. So long as this duality does not in practice produce irreconcilable conflict, it presents no obstacle to adopting the arrangement. There are already civil servants on the boards of the British National Oil Corporation and of the Atomic Energy Authority. This has worked well and their presence has proved useful both for the Government and for the two Corporations. The practical course is to experiment with the arrangement in other cases also where it is expected to be helpful.
27. Management and the unions in the nationalised industries are already making progress in developing new arrangements for consultation and participation. In the Post Office they have agreed on an experiment, lasting for two years, for a new Board with, in addition to the Chairmen, seven management and seven union members, and five independent members. In some of the other industries, the management and the unions have chosen to put the emphasis on the improvement of their existing consultative procedures rather than on involvement at Board level. The Government welcomes these initiatives, and intends to encourage progress in introducing and improving schemes of industrial democracy at all levels in the nationalised industries. It has accordingly asked the Chairmen of the nationalised industries to consult with the unions in each industry, where they are not already doing so, and to make joint proposals for further improvements in consultation and participation. The Government has asked the Chairmen to put forward their proposals by August 1978. They might range from worker representation at Board and lower levels to further developments in consultative and participative procedures. It is likely that any proposals which emerge can go ahead quickly under present legislation. However, if in any nationalised industries it is necessary to amend the statutes to allow for an experiment, or for new arrangements, the Government will introduce the necessary legislation, as it did for the Post Office experiment.
28. The Government will publish a White Paper on its views on the way forward in industrial democracy in the private sector as well as the nationalised industries.
29. In April 1975 the Government asked the National Consumer Council (NCC) to review the arrangements for consumer representation in the nationalised industries. The recommendations in the NCC's thorough and detailed report were not concerned with the manufacturing industries such as the British Steel Corporation but only with those industries which impinge directly on the consumer. It was published in August 1976 and the Government has had wide-ranging consultations on its recommendations, some of which it has already implemented. The Government sees an important continuing role for the nationalised industry consumer councils as spokesmen and guardians of the consumer interest, working in close association with the NCC at national, and with local authority and other advisory services at local, level. It also sees a role for consumer members on some nationalised industry boards.
30. Powers of consumer councils. The NCC were concerned that nationalised industries should give more weight to the views of their consumer councils, and recommended in particular that the Government should have a power to issue directions to an industry following consumer council recommendations; such powers already exist in respect of several of the nationalised industries concerned but there are some important exceptions. For the most part, normal relations between consumer councils and their industries will make Government intervention of this kind unnecessary. In most cases in which a consumer council makes a recommendation, the industry and council should be able to reach agreement between themselves on the necessary action. The same will be true also of discussions on the amount of information which the industries should disclose to the councils and the minimum period of notice which they should give to them before implementing the major proposals. In cases of disagreement it would be open to a consumer council to make representations to the Government, which would decide whether to give the industry a specific direction, using, where necessary, the new powers discussed in paragraphs 20-22 above, and subject, as noted there, to any conflict with our Treaty of Paris obligations. The NCC has also proposed that,
"Consumers and the nationalised industries, report by National Consumer Council to the Secretary of State, Prices and Consumer Protection." HMSO
CONFIDENTIAL whenever an industry failed to act on a recommendation from its consumer council the Secretary of State should be required to issue a direction unless both Houses of Parliament, by Order, specifically agreed that he should not. The Government does not accept this view: it considers that existing procedures are adequate to ensure that Parliament has an opportunity to challenge Ministerial decisions. The Government, however, welcomes the proposal that research reports by the councils should be available to the Select Committee on Nationalised Industries, and notes that the Select Committee already receives evidence from them.
32. Energy. In the light of the recommendations of the NCC and of the Plowden Committee, the Government has established an Electricity Consumers' Council (ECC) for England and Wales, initially on a non-statutory basis. The Council will fill an important gap in previous arrangements by giving English and Welsh electricity consumers an effective voice at national, as well as regional, level, where it will operate alongside the National Gas and Domestic Coal Consumers' Councils. The Government has introduced legislation to make the ECC statutory and to give it responsibility for co-ordinating regional electricity consumer representation. The National Gas Consumers' Council (NGCC) will continue to guide and co-ordinate the activities of the regional councils to ensure that gas consumers' views are given coherent and authoritative expression. The Government also intends to introduce legislation giving the Domestic Coal Consumers Council a statutory right to be informed by the National Coal Board of its plans, arrangements and proposals, and imposing a duty on the Board to consider any representations made by the Council.
33. Consumer Advice Centres and Citizens' Advice Bureaux already deal with large numbers of enquiries and complaints about public sector goods and services generally and the Government agrees with the NCC that they are an easily identified and convenient source of advice and help for consumers with problems of this kind including domestic fuel problems. However, the Government believes that the regional gas and area electricity consumers' and consultative councils, with their district committees, should continue to play a valuable role as specialists in addition to the generalist agencies, as well as
\*The structure of the Electricity Supply Industry in England and Wales, report by Committee of Enquiry to the Secretary of State for Energy: Cmd 6398. feeding in consumers' views to the national bodies. Over 2000 experienced men and women give their time voluntarily in this work and are available with advice and assistance to the public outside normal hours; they play an important part in advising local nationalised industry management and monitoring their performance, and provide the grassroots contact for formulating a consumer view at national level. The Government proposes to continue its support for these bodies, but will have further discussions with the ECC and NGCC and those responsible for the local authority and other Generalist services with a view to ensuring the most efficient liaison and integration between the various advice agencies.
34. The newly established National Energy Commission, on which domestic and industrial consumers are represented, will provide a valuable forum in which a consumer view can be brought to bear at the highest level. The Government has asked the NCC to give the three energy consumer council representatives its support in coordinating the views of consumer and voluntary organisations and providing research and secretarial services.
35. Surface Transport. The Government intends in due course, to promote legislation to extend the powers of the existing Central Transport Consultative Committee, at present prescribed by Section 56 of the Transport Act 1962. It will be renamed the National Transport Consumers' Council (NTCC), and enabled to consider the general tariff structure of the British Railways Board's railway passenger and parcels services; to consider a wide range of services and facilities provided by other transport operators, including bus services; and to make appropriate representations to the operators, the Traffic Commissioners or the Price Commission, as the case may be.
36. The Government believes, however, that it would be inappropriate for complaints about individual bus services to be handled by a national body. Furthermore the proposed introduction of Public Transport Plans will place upon shire counties in England and Wales additional responsibilities in the planning of bus services. In these circumstances the Government takes the view that county Councils should set up, under their general powers, advisory committees with representatives of consumer interests as well as council members. These advisory committees, which might be modelled upon the Transport Users' Advisory Committees already in existence in Passenger Transport Authority areas, would assist the county councils in their preparation of Public Transport Plans, deal with complaints about bus services in their area and cooperate with local generalist advice services. They will report to the local authority who would, under existing powers, be competent to make representations to the Traffic Commissioners as appropriate. The local authorities, the new advisory committees and the existing Area Transport Users' Consultative Committees (TUCCs) would be expected to establish liaison on matters of common interest. The remit of such advisory committees, as of the TUCCs, may later need to be reviewed in the light of Government decisions following consultations on the issues relating to local railway services that are particularly cost-ineffective, as set out in paragraphs 93-105 of the White Paper on Transport Policy (Cmd 6836).
37. Posts and Telecommunications. The Government will give careful consideration to the recommendations of the Post Office Review Committee relating to consumer representation. In the meantime, it has decided as part of the two year experiment in industrial democracy in the Post Office that there should be two members with experience of consumer affairs on the Post Office, appointed after consultation with the Secretary of State for Prices and Consumer Protection.
38. Aviation. The Civil Aviation Authority, which is responsible for the Airline Users' Committee, has given the Committee new terms of reference which ensure that it has a clearly autonomous position with an independent Chairman and secretariat, a more positive role in furthering the interests of air transport users and a responsibility to co-operate with the airport consultative committees.
39. Scotland, Wales and Northern Ireland. For those nationalised industries which operate on a United Kingdom basis, the arrangements described will also apply in Scotland, Wales and Northern Ireland, with minor variations, though account will be taken of the particular need to provide for the consideration of national issues of special concern to each of those countries. In Scotland, however, the electricity and bus industries need separate arrangements. The two Scottish Electricity Consultative Councils will remain, with their Joint Secretariat, responsible to the Secretary of State for Scotland, as recommended by the Scottish Consumer Council. The main operator of buses, outside the four city areas, is the Scottish Transport Group (STG), responsibility for which is to be devolved. No change is proposed at present in the arrangements for representation of consumer interests in relation to any of the STG's operations or to the Scottish bus industry generally; these are matters which the Scottish Administration will wish to consider in due course in the light of its responsibility for the STG and for local authority transport functions. In Northern Ireland, the Electricity Consumers' Council, and the Transport Users' Committee (which deals with bus, rail and airport facilities) will continue to represent their particular consumer interests, with liaison as appropriate with other consumer bodies in the United Kingdom. Other consultative arrangements
40. In addition to the proposals discussed so far, the Government is developing other ways of involving the main interest groups in the forward planning of an industry or a sector. Since 1974 the main policy questions in the coal industry have been discussed on a tripartite basis between the Government, the Coal Board and the coal unions. Last year the Secretary of State for Energy appointed an Energy Commission which will advise him on the development of an energy strategy for the United Kingdom and on other energy policy issues. The Commission includes representatives of the energy industries, and trade unions, and industrial, consumer and other interests. The recent White Paper on Transport Policy, Cmnd 6836, considered a number of ways in which the Government wanted to see consultation on the formulation and execution of transport policy improved, both at the local level and nationally. In addition, the Government is exploring further with the NEDO and with both sides of industry its ideas of setting up an Economic Development Committee for transport as one means of promoting, in the context of the industrial strategy, the regular consultation between the Government, management and the unions on plans for transport. Relations with suppliers
41. The NEDO point out that the nationalised industries' technical dominance and the scale of their purchases means that certain supplying industries have become almost wholly dependent on their strategic decisions and related investment programmes. Because of this several important studies have been commissioned by the National Economic Development Council since 1975 on various aspects of the relationship between the industries and their suppliers. This relationship is generally close, and given the strong bond of common interest between the two, the Government attaches a good deal of importance to this. A number of ideas and improvements were discussed in a NEDO report in 1975, and the involvement of the nationalised industries in the Economic Development Committees and associated NEDO working parties and industrial strategy sector groups gives both the industries and their suppliers a forum for tackling further questions of common interest.
42. There is also considerable scope for the nationalised industries and their suppliers to co-operate in export promotion to their mutual benefit. The NEDO studies of this include detailed analyses of the technical specifications laid down by the nationalised industries, with a view to aligning them where possible with international requirements so as to give the supplying industries a better chance of securing export orders; and also the promotion of co-operation between nationalised and private industry to allow them to compete together for major overseas projects, such as steelworks and railway construction and modernisation. In 1976, the nationalised industries set up special arrangements to promote collaboration between themselves and their customers and suppliers in the pursuit and development of exports. In addition, there are growing opportunities for sales of hardware and equipment by nationalised industries acting on their own account, or in participation with the private sector. The Government strongly welcomes all these initiatives and the positive role which the nationalised industries are taking, both jointly with the private sector and also on their own behalf in selling consultancy services to overseas countries and developing export opportunities generally. Corporate Plans and Investment and Financing Reviews
43. For many years the development plans and investment programmes of the nationalised industries, covering periods of 5 years ahead, have increasingly been formulated within the wider context of both the industries' and the Government's objectives and policies. This process of corporate planning, covering various time periods, involves a continuing dialogue on long-term strategy, medium-term development plans, and annual operating plans and budgets. The industries look to the Government for guidance on industrial policies, on economic prospects, and where appropriate on sectoral policies, including the social objectives underlying the payment of grant from public funds. The Government looks to the industries for data on markets, supplies and production. The development of this process is more advanced with some of the industries than others. Its benefits are already becoming apparent in the energy sector where over the past year or so a joint Working Group on Energy Strategy (with membership drawn at Board level from the nationalised industries and from Government Departments) has contributed materially to the harmonization of planning timetables and procedures, to the understanding of the industries' and Government's medium-term forecasting methods, and in particular to the joint examination of the implications of alternative energy sector strategies for the plans and prospects of the industries. The process of joint examination of issues affecting policies and plans is now to be carried further in the recently formed Energy Commission for Energy under the chairmanship of the Secretary of State. There have also been valuable developments in corporate planning in other nationalised industries, and the legislation establishing British Aerospace and British Shipbuilders requires the two Corporations in formulating their corporate plans to act on lines settled from time to time with the approval of the Secretary of State for Industry. The Railways Act 1974 made similar provision in relation to the Railways Board.
44. The Government considers that the corporate plan, and the examination of strategic options, should have a central place in the relationship between the nationalised industries and their sponsoring departments. As corporate planning is established more widely it will enable the annual review of the industries' medium-term investment programmes to take place in the context of known and understood longer term strategies. This is not to say that there will be no changes from year to year in the five year plans of the industries for implementing the agreed strategies. The industries regularly revise their five year programme, often substantially, to take account of changes in the outlook for the economy, in the demand for their particular products, in relative costs and prices, in the burden of their financing requirements, and in physical progress in the installation of new plants or of new buildings. Nationalised industries, like any commercial organisation, must continue to show flexibility and to make such changes. Moreover the strategic framework itself cannot be regarded as immutable. From time to time there are major long-term reviews of overall policy, covering either the whole future strategy of an industry or some crucial aspect of it, such as a technological decision on the choice of a new system. These represent an important turning point for an industry, and the Government accepts that, once long-term policy decisions are taken on this basis, they should not be reopened unless and until there has been a material change of circumstances. So that the Select Committee on Nationalised Industries, and the public, can be better informed of the industries' objectives the Government has asked them to publish in their annual reports and accounts a summary of the broad objectives in their corporate plan, and in any major review, and any Government response to them.
45. The NEDO point out that the investment plans of a number of the nationalised industries have suffered over the years from intervention by Governments, through short-term cuts to reduce public expenditure or through intervention in previously agreed strategic plans. The dialogue between the Government and industries in the corporate planning Process should help to provide a more stable framework. In addition the Government has made two changes in its procedures which it believes improve the way in which the industries' expenditure plans are handled and publicly presented.
46. Following an initiative in the NEDC, in 1975, Ministers agreed that they would aim to give the industries by the end of the summer, rather than the end of year, approval for 100% of their agreed investment programme for one year ahead, 85% for the second year and 70% for the third year (for which, under the previous procedures, no approval had been given at all). This new procedure helps the nationalised industries directly by enabling them to get on with implementing and rolling forward their plans. It also puts them in a position where they can help their supplying industries by drawing up firm plans earlier than had been possible hitherto.
47. The NEDO commented on the presentation of the nationalised industries' figure in statistics of public expenditure, and the Government has made changes in line with their thinking. Under these new arrangements the investment programmes of the industries are still published in Public Expenditure White Papers, but it is the estimates of the funds to be provided towards this investment, in the form of loans, Public Dividend Capital or grants, which are included in the public expenditure totals. This new presentation recognises the essential difference between the nationalised industries, which finance a great deal of their investment from their earnings, and the generality of non-trading public services. The Government believes that it will also be helpful to the industries if on any future occasions it is necessary to involve them in any general exercise to reduce the planned level of public expenditure. Whereas previously any cuts they made had to be in their investment programmes, in future they will in principle be able as an alternative to take any other action which would reduce their requirements for external finance - such as cost savings and, subject to counter inflation policies, price increases. The presentation of these figures in the Public Expenditure White Paper shows loans and Public Dividend Capital, on which the industries are expected to pay interest and dividends, separately from grants given for social and regional purposes.
48. The NEDO consider that the boards are not effectively required to account for their performance in a systematic or objective manner. They point out that there is no external audit mechanism - additional to the present financial audit procedures - which might provide reassurance to Government and Parliament about the effectiveness of management organisation and procedures within the industries. They recommend that the annual report and accounts of each industry should in future include a statement of financial and other criteria and of achievement against them.
49. It is the responsibility of each board to monitor performance and efficiency within its industry but the Government agrees that it is also essential for the industries to account effectively to Parliament and to the public. It has, therefore, asked each of them to include in its annual report a statement summarising and bringing together the Government's main current instructions and guidance, and also information on how it is measuring up to its objectives. There may be some information which an industry cannot publish for reasons of commercial confidentiality. But in general the statement would include, for example, the main points in the corporate plan and any Government response to them (see paragraph 44); the financial target, and the accompanying Parliamentary statement explaining it, including any sectoral and social objectives set for the industry (paragraph 73); the cash limit (paragraphs 79-82); suitable aims in terms of performance and service (paragraph 78); and any general or specific directions given to it (paragraph 20). In its statement of how well it was measuring up to these objectives, the industry would compare its financial performance against its target and also its progress against its published performance and service aims. The systematic and regular publication of this information will be an important development in response to the NEDO's report and one which will be helpful to the Select Committee on Nationalised Industries, and to Parliament generally, in examining and monitoring the performance of the industries, and of the departments which deal with them.
50. There are also a number of other ways in which the industries' activities will come under independent scrutiny. Under the Price Commission Act of July 1977, the Price Commission has discretion, subject to Ministerial veto, to investigate most price increases proposed by the nationalised industries. (The main exceptions are bus and air fares, which are controlled by the Traffic Commissioners and by the Civil Aviation Authority, and coal and most steel products which are subject to European Coal and Steel Community regulations). If Ministers direct it to do so, the Commission can also examine a nationalised industry which is a monopoly supplier. Secondly, the Government expects the consumer councils to play an important role in monitoring the industries' responsiveness to the needs of their customers and in making recommendations on the services they give; and a number of ways in which the consumer council arrangements have been strengthened are described in paragraphs 30-39. Thirdly, the Government will be prepared on occasion to appoint special committees of enquiry to examine the structure, performance and plans of particular industries where it appears that there is a need for a far ranging review. The Government will keep under review the possibility of strengthening arrangements for the external monitoring of those industries which enjoy substantial protection from competition.
51. The Government also expects the industries to take the initiative in strengthening their own systems for control and monitoring. It therefore welcomes the development of Audit Committees, which the National Coal Board, the British Steel Corporation and a number of private sector companies have recently been introducing, whereby a special group, usually including part-time non-executive directors, examine and report on annual financial statements, audit arrangements and internal financial controls. The Government believes that this is a useful innovation which other nationalised industries may wish to adopt. It hopes that they will develop further the role of these Audit Committees, or set up comparable arrangements, to look more generally at questions of efficiency and performance within their industry. The Government also expects that, in the normal exercise of their management functions, the industries will continue to take the initiative in calling in management consultants to undertake special studies when necessary. III. THE FINANCIAL AND ECONOMIC FRAMEWORK
52. The nationalised industries are major users of national resources. They employ about 1,700,000 people, or 7% of the country's total labour force. Their total investment this year and next is about £3,500 million at 1977 prices, and in 1976 they accounted for 14% of total fixed investment. A considerable part of their capital requirements is financed by advances from, or guaranteed by, the Government, and in 1976-77 these represented about 15% of the total Public Sector Borrowing Requirement of £8,800 million. In 1976 they contributed about 10% of the total output of the UK economy. They dominate four strategic sectors of economic activity: energy, public transport, communications and iron and steel. They supply basic goods and services to industry, and essentials of life to individual consumers. They are themselves major customers of some of the capital goods industries, and the scale of their purchases means that some of these supplying industries are heavily dependent on their strategic decisions and investment. In short, the nationalised industries have a pervasive influence throughout the economy on investment, employment, industrial costs, and on the cost of living. The share of national resources going to them, and the efficiency with which they use these resources, are matters of major importance.
53. This is why the Government has the responsibility to set out the broad financial and economic framework within which they want the industries to operate. The consequences of the price restraint policies of the early 1970s, and the
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} |
9fb6aa7f03d725df505ae290bcf742832d5ede6a | | Serial No. | Date | Brief Description | |-----------|----------|-----------------------------------------------------------------------------------| | 1 | 17.1.89 | GREEN PAPERS ON THE LEGAL PROFESSION\
Memorandum by the Lord Chancellor | | 2 | 24.1.89 | DRAFT WHITE PAPER ON THE REFORM OF\
THE NATIONAL HEALTH SERVICE\
Note by the Secretary of the Cabinet | | 3 | 14.2.89 | ECONOMIC STRATEGY\
Memorandum by the Chancellor of the Exchequer | | 4 | 15.2.89 | REVIEW BODY REPORTS 1989\
Note by the Secretary of the Cabinet | | 5 | 7.3.89 | THE LEGISLATIVE PROGRAMME 1989–90\
Memorandum by the Lord President | Most colleagues will already know that I am proposing to publish three Green Papers on 25 January 1989 covering the work and organisation of the legal profession, conveyancing by authorised practitioners and contingency fees. Copies of the proposed Green Papers are attached. These Papers are the fruits of my paper to colleagues on competition in the legal profession (E(CP)(88) 1) which was endorsed by the Ministerial Steering Committee on Economic Strategy Sub-Committee on Competition Policy (E(CP)) on 5 October 1988 (E(CP) 88 4th meeting). That paper flowed from my disappointment with the report of Lady Marre's committee ("A Time for Change" - Report of the Committee on the Future of the Legal Profession presented to the General Council of the Bar and the Council of the Law Society, July 1988). That report failed to address the fundamental issues about organisation and structure facing the profession.
THE WORK AND ORGANISATION OF THE LEGAL PROFESSION
2. I have tried in my proposed main Green Paper (The Work and Organisation of the Legal Profession) to examine the structure and practices of the profession from first principles. The Paper states that our overall objective is to see that the public has the best possible access to legal services and that those services are of the right quality for the particular needs of the client. It sets competition and the maintenance of standards as its twin approaches to achieving this objective. It therefore promotes the removal of restrictions on competition, where these serve no useful purpose, while seeking to ensure that there are safeguards, which are sufficient by no means, to maintain the standards of conduct and the integrity of the legal profession. The Paper then seeks to draw out the structure which is best suited to give effect to these principles, against the background of the various needs of the public for legal services today.
3. The Paper accordingly sets out possible new arrangements for legal education and for the maintenance of professional standards. Since I regard education, qualifications, training and standards as the key areas in ensuring the legal profession is best structured to meet the needs of the public. The Paper proposes new arrangements in respect of advocacy, which should ensure that all those, but only those, who are properly trained, suitably experienced and subject to codes of conduct which maintain standards, will have rights of audience. There are several consequential proposals, particularly in respect of access to counsel, the appointment of Queen's Counsel, and appointments to the judiciary; and the Paper goes on to highlight a number of issues relating to the internal organisation of barristers' and solicitors' practices which I believe would benefit from a thorough examination. The Paper also proposes the abolition of the monopoly currently enjoyed by solicitors on carrying out non-contentious probate work for reward.
CONVEYANCING BY AUTHORISED PRACTITIONERS
4. There are two supporting Green Papers. The Paper on conveyancing by authorised practitioners proposes a new and less cumbersome system for permitting conveyancing by institutions than that contained in schedule 21 to the Building Societies Act 1986, while also seeking to reassure the public that the Government remains committed to the availability of a country-wide network of local legal service providers. Institutional conveyancers will be required to follow and enforce a strict code of conduct, but will also be able to use their own employed solicitors or licensed conveyancers to offer conveyancing services to the public, including their own customers.
CONTINGENCY FEES
5. The Paper on contingency fees rehearses the arguments for and against the introduction of contingency fees, especially in the light of the mixed experience of contingency fees in the United States. The Paper concludes that it would be appropriate to introduce into England and Wales speculative actions on the model which already exists in Scotland; and suggests that this might be coupled with the ability to agree an uplift on the costs, payable to the lawyer only in the event of success. The Paper, however, only seeks views on whether it would be appropriate to go beyond this and introduce contingency fees linked to the amount of the damages awarded, even if controls were placed on the extent to which contingency fees could be used.
TIMETABLE
6. The Papers have been drafted with the help of an inter-departmental working party chaired by one of my officials; and I have had the benefit of colleagues' comments on the drafts. I have prepared the Papers with early action in mind. I propose a three month consultation period after publication which will last to the end of April this year. This is a short, but in my view sufficient, period. It should allow us just sufficient time to take firm decisions in the light of responses to the Green Papers and to announce those decisions in the form of a statement to both Houses of Parliament before the summer recess this year. Changes on the lines envisaged in the Green Papers will require primary legislation. If we follow the timetable I have set out, the necessary legislative provisions could be included in the Courts and Legal Services Bill I am proposing for the 1989-90 Parliamentary session. CONCLUSION
I accordingly invite colleagues to agree to the publication of the three Green Papers with the intention that we should reach firm decisions on the proposals set out in these Papers before the summer recess this year. If colleagues agree to this approach, I propose that these Papers should be published by way of a response to a written PQ on Wednesday 25 January 1989.
J M
Lord Chancellor's Department
17 January 1989 Contingency fees
Contents
Chapter 1. Introduction
Chapter 2. Background
The position in England and Wales The position in Scotland The position in the United States of America
Chapter 3. Arguments for and against the introduction of contingency fees
The risk of a conflict of interest Protection by professional codes of conduct The United States experience Levels of damages The rule that costs follow the event Other factors in the US system Volume of litigation Access to justice Allowing the consumer to choose Product liability Summary
Chapter 4. How a system of contingency fees might operate
A speculative basis A restricted contingency basis An unrestricted contingency basis CONFIDENTIAL
Legal aid The judges The costs rule Which proceedings
Chapter 5. Conclusion CHAPTER 1 - INTRODUCTION
1.1 A contingency fee arrangement is one whereby a lawyer agrees that he will accept his client's case on the basis that he receives no payment if the case is lost, but that if it is won, he will be paid some percentage or share of the award made by the court. Such agreements are unenforceable in England and Wales and solicitors and barristers are prohibited by their respective professional codes of conduct from entering into them. In Scotland, solicitors may agree to conduct litigation on a 'speculative' basis, that is, they will receive their normal taxed costs if the case is won, but nothing if it is lost. Contingency fees are, however, allowed in many of the jurisdictions of the United States of America, where the payment made to the lawyer often relates to the amount of damages recovered by the client.
1.2 The use of contingency fees in England and Wales has always previously been resisted. The main arguments against their use are that:-
(a) they may result in a conflict of interest between lawyer and client. The lawyer will have a direct financial interest in the outcome of the case and will be unable to give the client impartial advice. This may lead to:-
(1) the lawyer being tempted to encourage the client to settle early to avoid the effort involved in fighting the case; (ii) the lawyer concentrating on cases with a high nuisance value where the defendant is more likely to be forced into making an offer to settle; and
(iii) the lawyer being tempted to try to enhance his client's chances of success, perhaps by coaching witnesses or withholding inconvenient evidence; and
(b) experience in the USA suggests that contingency fees:-
(i) encourage juries to award excessively high damages; and
(ii) encourage litigants to proceed with cases with very little merit, leading to an explosion of litigation.
1.3 Proponents of the introduction of contingency fees discount these arguments. They point out that the dangers of a conflict of interest may be guarded against by proper codes of conduct and through restrictions on the amount a lawyer is able to recover. They also note that what are considered to be the undesirable elements of the US system go wider than contingency fees and have their roots in some fundamental differences between the jurisdictions in the US and that in England and Wales. These differences are explored more fully in paras 3.5 to 3.10 below.
1.4 Current Government policy is, moreover, in favour of deregulation. This entails the removal of restrictions and the consequent widening of choice for those providing a service and for the consumer, unless there are clear public interest reasons to the contrary. The Government also believes that the onus should be on those who want to maintain a restriction to justify it.
1.5 The arguments in favour of the introduction of contingency fees are that:-
(a) they would give individuals and organisations who do not qualify for legal aid, but who cannot support expensive litigation, the opportunity of bringing their claims to court;
(b) they would encourage a greater level of commitment on the part of the lawyer; and
(c) they would encourage competition between lawyers, as clients would be able to shop around between solicitors to seek the most advantageous agreement.
1.6 The Royal Commission on Legal Services(^1) (Benson) considered whether contingency fees should be allowed in England and Wales, but concluded that any change in the law which gave lawyers a direct financial interest in the outcome of a case was not in the public interest on the grounds that it would endanger the independence of the legal profession. The Royal Commission believed that the system would not work well here and would give rise to serious dissatisfaction. It would benefit only a limited class of litigants and would reward some lawyers disproportionately. The Royal Commission on Legal Services in Scotland(^2) (Hughes) also concluded
(^1)1979 Cmnd 7648 (^2)1980 Cmnd 7846 that contingency fees should not be introduced in Scotland. They were particularly concerned about the risk that a conflict of interest might arise between a solicitor and his client where there was an agreement to act on a contingency basis.
1.7 More recently, however, both the Civil Justice Review(^3) and the Marre Report(^4) have recommended that the possibility of allowing contingency fee arrangements between lawyers and their clients should be re-examined. In suggesting that the prohibition on contingency fees should be open to re-examination the Civil Justice Review pointed out that there have been major advances in regulation policy, and that it could be argued that the risks arising out of a contingency fee system could be controlled by specific regulations rather than a general ban.
1.8 It is against this background that the Government has concluded that further consideration should be given to the question whether existing bars to the use of contingency fees should be lifted. This paper explores the issues and examines possible mechanisms for the control of contingency fees and the scope for change.
1.9 The Government would welcome comments on the issues raised in this paper by 2 May 1989. Submissions should be addressed to:
______________________________________________________________________
(^3) Report of the Review Body on Civil Justice 1988 Cm 394
(^4) "A Time for Change" - Report of the Committee on the Future of the Legal Profession presented to the General Council of the Bar and the Council of the Law Society, July 1988 (Marre). CONFIDENTIAL
Room 412 Lord Chancellor's Department Trevelyan House 30 Great Peter Street London SW1P 2BY CHAPTER 2 - BACKGROUND
The position in England and Wales
2.1 Contingency fee arrangements have always been unenforceable at common law in England and Wales.
2.2 Maintenance (the giving of assistance, encouragement or support to litigation by a person who has no legitimate interest in the litigation nor any motive recognised by the court as justifying the interference) and champerty (the maintenance of an action in consideration of a promise to give the maintainer a share in the proceeds or subject matter of the action) were long prohibited at common law. It was considered to be against public policy that litigation should be promoted and supported by those with no interest in it. Blackstone's Commentaries record that "This is an offence against public justice, as it keeps alive strife and contention, and perverts the remedial process of law into an engine of oppression."¹
2.3 The Criminal Law Act 1967 abolished the old common law offences of maintenance and champerty. Section 14(2) of the same Act provides, however, that abolition of the common law offences shall not affect any rule as to the cases in which a contract is to be treated as contrary to public policy or otherwise illegal. Agreements to maintain an action therefore remain unenforceable today.
¹ Blackstone's Commentaries on the Law of England (1897) S.12 Agreements to act on a contingency basis are also restricted by section 59 of the Solicitors Act 1974. They are proscribed completely in respect of proceedings in England and Wales by rule 8 of the Solicitors Practice Rules 1988. This provides that:
"(1) A solicitor who is retained or employed to prosecute any action, suit or other contentious proceeding shall not enter into any arrangement to receive a contingency fee in respect of that proceeding.
(2) Paragraph (1) of this Rule shall not apply to an arrangement in respect of an action, suit or other contentious proceeding in any country other than England or Wales when such arrangement is made between a solicitor and a person entitled to practice as a lawyer in that other country in respect of that proceeding."
The position in Scotland
In Scotland there is a long tradition of the lawyer acting on a speculative basis. The speculative action is usually an action for damages for personal injury. Solicitor and advocate undertake to act for the pursuer on the basis that they will not be remunerated except in the event of success and that any costs such as court fees will be defrayed by the solicitor. The courts in Scotland have long recognised that this is a perfectly legitimate basis on which to carry on litigation and that it is a reasonable way of enabling people who do not qualify for legal aid to finance costly litigation: X Insurance Co v A and B 1936 SC 239. Undertaking to act on a speculative basis imposes on both advocate and solicitor special duties to satisfy themselves that there is a reasonable prospect of success. If a solicitor wishes to instruct an advocate on a speculative basis he must state the fact explicitly in his instructions and the advocate is not bound to accept.
2.6 In the event of the case being successful the solicitor and advocate are paid their normal fee. If the case is lost they are paid nothing. Traditionally the speculative action is useful to pursuers who have a reasonable case, but who are not eligible for legal aid on financial grounds, such as small businesses. At a time when the arguments in favour of contingency fees as such were firmly rejected, the Royal Commission on Legal Services in Scotland recognized that the speculative action played an important role in Scottish law. The view was, however, taken that small businesses ought properly to obtain insurance to cover their needs as potential litigants.
2.7 An important feature of this system is that it offers no protection to the pursuer against the award of expenses in the event of an unsuccessful outcome. The rule that costs follow the event is thus not affected by a scheme such as the speculative action. The unsuccessful pursuer remains liable for the costs of his successful opponent.
The position in the United States of America
2.8 When the subject of contingency fees proper is discussed the first point of reference is invariably the USA, where the Supreme Court has recognised the validity of contingency fee contracts since 1850. There is, however, a variety of schemes operating within the 50 states. Each state has its own individual practice and its own controls on contingency fee agreements between lawyers and clients. The State of Maine, for example, prohibits contingency fees entirely. In New York, Michigan and Delaware, statute has overruled initial restrictions. Contingency fees are not prohibited in New Jersey, Alabama, Ohio and California, but they are subject to limitations and controls.
2.9 Contingency fees are most frequently used in personal injury cases where the potential award (or reward) is greatest. Some lawyers may also agree to act on a contingency basis in outstanding debt, workmen's compensation, corporate business practice, taxation, land compensation and will contests.
2.10 Despite a longstanding and general acceptance of the contingency basis for remuneration, the U.S. courts have proscribed the use of the contingency fee in certain areas on the grounds of public policy. The Disciplinary Rules of the Code of Professional Responsibility (CPR) allow contingency fee agreements only in civil cases, prohibiting their use in criminal matters. The Ethical Considerations of the CPR also advise that contingency fees are not appropriate in domestic cases.
2.11 Across the states various methods are used to fix the fee recoverable by the lawyer. For example, the lawyer may be able to assess his fee using a formula which takes account of the size of the award recovered. In other jurisdictions the "customary rate" may be applied or the rate may be fixed by the Bar Association, by the court (particularly in the case of litigants under a disability), by statute prescribing the maximum fee that can be recovered or by an administrative agency. 2.12 The most common basis of charging for contingency fees in the USA is, however, a percentage of the sum recovered. The actual figure can be calculated in a number of ways. There may be one rate applicable to the whole recovery; decreasing percentage rates as the amount of the recovery increases; increasing percentage rates as the amount of the recovery increases, dependent on the expenditure of additional skill and effort; or a series of increasing percentage rates applied to the recovery depending on the stage reached in the proceedings before the recovery. The agreement will also stipulate whether the costs and expenses of the action are to be deducted from the recovery before or after the lawyer's percentage is computed.
2.13 No jurisdiction other than those in the United States operates an extensive contingency fee system. CHAPTER 3 - ARGUMENTS FOR AND AGAINST THE INTRODUCTION OF CONTINGENCY FEES
The risk of a conflict of interest
3.1 The principles underlying the prohibition in England and Wales of the use of contingency fees relate, as has been noted above, to the undesirability of anyone being allowed in any way to encourage or support litigation in which he does not have an interest. In particular the belief is that it is unprofessional for a lawyer to be paid on a contingency basis. The main concern is that to act on a contingency basis would, for the lawyer, produce an unacceptable conflict between his interests and those of his client and encourage him to behave in an unprofessional manner.
3.2 The conflict is said to arise from the fact that a lawyer acting on a contingency basis has a direct interest in the outcome of the litigation and that this will prevent him from being an impartial adviser. He will be open to the temptation of encouraging his client to accept an early (and perhaps unnecessarily low) settlement in order to avoid the high expense (for the lawyer) of a trial. He may concentrate on cases which have little merit but a high nuisance value, which will cause the opponent to settle even if his chances of success in any trial would be good. The lawyer's direct interest in the outcome might lead him to indulge in undesirable practices designed to enhance his client's chances, such as coaching witnesses, withholding inconvenient evidence or failing to cite legal authorities which damage his client's case.
Protection by professional codes of conduct 3.3 It is not clear that there is any real basis to these fears. Clients probably already expect their lawyers to be fully committed to the case and, since this is what every client is likely to want, to winning that case. Wanting success cannot be wrong in itself, provided that unfair means are not used in achieving it. Any tendency on the part of a lawyer to "improve" his client's case ought to be capable of control through professional codes of conduct, and the judges already possess the power to penalise solicitors personally in costs for any improper act or omission in the conduct of litigation. Both sides of the profession are, in England and Wales, subject to stringent codes of practice which, if broken, may lay the lawyer open to disciplinary proceedings before his professional body which can result in his losing his right to practise. To assume that the financial interest introduced by a contingency fee will override the standards of an individual in relation to his client is to assume an unreasonably low standard of conduct for the profession as a whole. There is no evidence to justify this assumption.
3.4 It must also be remembered that the value of the subject matter of the lawyer's work can already be relevant to the fees charged. Appendix 2 to Order 62 of the Rules of the Supreme Court sets out the factors which have to be taken into account in the exercise of a taxing officer's discretion to fix costs. These factors include, amongst others, "the importance of the cause or matter to the client" and "where money or property is involved, its amount or value". The same principles apply in respect of both contentious and non-contentious matters.
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1 Order 62 rule 11 of the Rules of the Supreme Court. The United States experience
3.5 Critics of contingency fees point to the U.S. experience as further justification for continuing the ban on their use in England and Wales. It is said that the existence of contingency fees encourages juries in civil cases to award excessively high damages to successful plaintiffs, because it is known that the balance otherwise left available after the lawyer has taken his percentage (which may be as high as 50%) may be insufficient to compensate the plaintiff for his injuries.
3.6 It is also said that the ability to sue on a contingent basis encourages the pursuit of low merit cases for nuisance value against organisations with sizeable assets, such as large companies and Government departments. The combination of high legal fees - which cannot, as in England and Wales, be recovered in costs - and the fear of punitive damages is said to encourage companies in particular to settle out of court, whatever the merits of the case, to save time and money. This causes an increase in the insurance premiums which have to be paid by large organisations which are ultimately passed on to the consumer. Finally, it is said that the existence of contingency fees encourages the distasteful practice of "bounty-hunting" lawyers chasing those affected by a major disaster.
Levels of damages
3.7 It is not clear to what extent the existence of the jury in U.S. civil actions leads to excessive awards of damages. It is at least likely, as critics of the U.S. system suggest, that knowledge of the existence of a contingency fee agreement and of the high percentages required by lawyers, will induce civil juries to make excessive awards of damages. The judge is, however, able to reduce the damages initially awarded by the jury and it may be that exceptionally high awards result where a judge fails to give adequate directions to the jury or where there is a desire to make an example of a defendant in circumstances giving rise to public concern.
3.8 Contingency fees (if introduced into England and Wales) would need to operate within the current system of awarding damages. Here, damages are almost always awarded by the judge, and only in certain limited categories of actions (such as defamation), by a jury. The present method of awarding damages is a staged process involving the determination of general damages for the type of injury suffered and special damages for expenditure and loss to the date of the hearing, plus expected loss of income and future expenses. As the sum of damages to be paid remains within the power of the judge according to well-established guidelines, the introduction of contingency fees would appear to have little bearing on the sums awarded. Just as there is no evidence that the application of the statutory charge to damages and property recovered by a legally aided litigant results in increased awards of damages, so it seems unlikely that current practices in the awards of damages would change in the event of the introduction of contingency fees. Even if it were thought that there was a risk that judges in England and Wales would react in the way in which it is said that U.S. juries react, this could be avoided by introducing a rule that the fact that the case was being run on a contingency basis should not be revealed until after judgment had been given. The approach could be similar to that taken on payment into court, the existence of which is not revealed to the judge until the case has concluded and he is considering the award of costs.
The rule that "costs follow the event"
3.9 There is a further significant difference between the position in the United States of America and that in England and Wales. Here, the losing party is usually required to pay the reasonable costs of his successful opponent. There is no such rule in the U.S. jurisdictions which allow contingency fees. At the moment in England and Wales, the risk of having to pay costs if unsuccessful could be said to act as a deterrent on the plaintiff. He has to weigh very carefully the chances of loss before embarking on litigation. If he is able to avoid the risk of paying his own costs under a contingency fee agreement, he may be more willing than at present to embark on litigation, even if he cannot avoid a potential liability to his successful opponent. Since his lawyer is, however, likely to have conducted a very rigorous assessment of the prospects of success before taking a case on a contingency basis, it is unlikely that the introduction of contingency fees, taken together with the rule that costs follow the event, would have any real impact on the propensity to litigate. Certainly it is thought that the existence in England and Wales of the rule that costs follow the event would continue to have a deterrent effect, even if contingency fees were to be allowed. Any change in this rule would certainly leave defendants unprotected, and this would not be desirable, given that it is hard to see how a defendant to an action for damages could benefit from the introduction of contingency fees.
Other factors in the US system
3.10 There are several other differences between the US jurisdictions and that in England and Wales which need to be taken into account. United States society is litigious on a scale not known in England and Wales. In the USA, treble damages may be awarded in anti-trust cases and, in other cases, punitive damages are very much more widely used than they are in England and Wales. There is, therefore, a much greater incentive in the USA for plaintiffs to pursue marginal cases. Finally, class actions may be brought in the USA and this, combined with the other factors already mentioned, encourages "bounty-hunting" by US lawyers.
Volume of litigation
3.11 It is in any event unclear that the mere existence of contingency fees would lead to an upsurge in litigation. Quite apart from any restraining effect that the costs rules might have, it is unrealistic to suppose that lawyers, as professional people running businesses, would willingly take on cases where there was very little real prospect of success. The solicitor invited to act on a contingency basis will have to make a rigorous assessment of the likely chances of success and the possible amount of damages recoverable. Cases which will be difficult to prove, perhaps involving the collection of highly complex evidence, will not be taken on unless the likely rewards are high enough to reward the work that will have to be undertaken. This assessment will have to be undertaken in more detail than where the work is undertaken on a time charge basis. So although a larger section of the community would have access to a means of funding their litigation, in practice solicitors will sift out the less viable cases as they do at present. The contingency fee would, however, give some people the opportunity of seeking legal advice and would give others the choice of how they pay for the services of a solicitor.
Access to justice
3.12 The main advantage of contingency fees is that they might give "small" plaintiffs the opportunity of bringing their claims to court. "Small" in this context means those individuals and organizations who do not receive legal aid but who nevertheless have insufficient means to support the full cost of expensive litigation and who cannot call on, for example, the support of a trade union or do not have legal expenses insurance. Where there is a desire or need to litigate there is also a demand for the means to do so. Although legal aid is widely available in this country for those whose means fall below prescribed limits, it is not available to those above those limits or in respect of certain proceedings (such as proceedings before most tribunals). There may be sections of the population whose means take them above the legal aid eligibility limits who might wish to litigate on a contingency basis.
Allowing the consumer to choose
3.13 Contingency fee arrangements may also be said to encourage a greater level of commitment on the part of the lawyer, who would have a stake in the outcome of the proceedings (if it can be accepted that the existence of this stake does not produce an unacceptable conflict of interest between the lawyer and his client, nor place the lawyer's duty to the court in jeopardy). If contingency fees were introduced this would be a further incentive for the client to shop around available firms of solicitors, since the likely cost to him would be influenced by the choice between contingency or conventional fee arrangements, as well as by the price structure of different firms. This will place pressure on the solicitor to operate efficiently, especially where the contingency basis is concerned, because the more drawn-out the proceedings, the lower the likely reward for the solicitor and the later he will get it.
3.14 Contingency fee arrangements would also spread the risk of litigation for "small" litigants who can be expected rarely to resort to the courts for the resolution of their disputes. The U.S. system of contingency fees shifts the risks of litigation from the plaintiff to the lawyer. The lawyer is able to spread those risks over a number of cases and is therefore in a better position to bear them.
3.15 Removing the ban on contingency fees would enable the client who has a cause of action to seek out the most advantageous agreement; and allowing this freedom of choice may alone be regarded as grounds for lifting the ban on contingency fees.
Product liability
3.16 There is a significant argument in favour of the introduction of contingency fees to be drawn from the US experience. It is one of a number of possible measures which may confidently be expected, on the basis of experience in the United States, to shift the present balance of advantage between the litigants in product liability cases. Such a shift would make producers more conscious of their duty to supply safe products, and induce them to give product safety higher priority in the conduct of their business. This in turn would tend to reduce the number and severity of injuries suffered by people as a result of defective and unsafe products. In the United States industry's increasing concern with product safety, which now makes European producers appear by comparison to be backward, has been fuelled by fear of adverse court judgements and awards of damages, rather than by respect for the criminal law which prescribes certain safety requirements for certain goods (such as electrical equipment) or by any altruistic wish that the risk of injuries to consumers should be kept to a minimum.
Summary
3.17 It appears that existing restrictions on the use of contingency fees developed because of the need to prevent interference in the conduct of proceedings in court and the encouragement of cases which would not otherwise have been brought. The adoption of express restrictions into professional codes of practice reflects the distaste with which lawyers, as members of a professional group, viewed the use of such devices as contingency fees.
3.18 Rules which were developed to prevent interference with the administration of justice in feudal times may no longer be appropriate to the demands of the public for the delivery of efficient and business-like legal services. There is a class of litigants who may drop claims because they are ineligible for legal aid but do not believe they have sufficient means to pursue their claims unaided, even though they are reasonably confident of securing damages. There are, however, worries about the conflict between the interests of the client and those of the solicitor which, to the extent that they do not coincide in a contingency fee agreement, may put the client in a weaker and less advantageous position.
3.19 Solicitors and barristers have had to respond to market pressures in other areas, such as advertising. The ban on the use of contingency fees could be completely lifted and all restrictions removed. It could be argued that the client does not need any protection when entering into an agreement with a solicitor and that he is perfectly capable of shopping around to seek the most advantageous terms. The solicitor does, however, have greater knowledge of the likely costs in a particular set of circumstances. He will, therefore, be in a stronger position than the client in the negotiations leading up to a contingency fee agreement. If the parties to the agreement are in unequal positions when the bargain is being struck then some means may be required of restricting the terms of agreement that the solicitor might otherwise be able to impose on the client.
3.20 The lessons to be drawn from the U.S. experience are that the unrestricted use of contingency fees appears to be undesirable. The differences between the jurisdictions are, however, such that the worst excesses of U.S. contingency fee arrangements should not develop in England and Wales. It is the combination of such factors as a jury's ability to award damages, the absence of any rule that the loser pays the winner's costs, the possibility of punitive damages and the use of class actions, none of which is present in England and Wales, which, taken together with the ability to use contingency fees, gives rise to the worries about the U.S. system. It is worth bearing in mind, moreover, that the tide of opinion in the United States of America is turning against the unrestricted use of contingency fee agreements. Some states are now reviewing their policies in this area and considering tighter controls on the way contingency fees are operated. CHAPTER 4 - HOW A SYSTEM OF CONTINGENCY FEES MIGHT OPERATE
A speculative basis
4.1 The first, and perhaps most obvious, relaxation of the existing restrictions in England and Wales would be to allow solicitors and counsel to act on a speculative basis, as is already possible in Scotland. A solicitor would be free to agree with his client that he would be paid only if the proceedings were successful. If they were, he would, however, recover only his taxed costs and would not be entitled to any share in the damages or property recovered in the litigation. If it were necessary to instruct counsel, this would again be on a speculative basis, with counsel's clerk being informed of the basis before the brief was accepted. Counsel would be free to turn it down if he were not prepared to act on a speculative basis. It would not, however, be necessary to obtain a full taxation in every case funded on a speculative basis. Taxation would be required only where, as is the case now, there is a dispute between solicitor and client as to the amount that the solicitor can reasonably charge in his bill.
4.2 There does not appear to be any substantial argument against the introduction of speculative actions in England and Wales.
4.3 The second relaxation would be to build on the introduction of the speculative action. The obvious shortcoming of such actions, so far as solicitors and counsel are concerned, is that there is no extra element to compensate them for the cases which they undertake on a speculative basis but which are unsuccessful. They will not, therefore, wish to carry too great a risk and will be concerned to be as sure as they can that they accept speculative actions only where the prospects of success are excellent. The fact that lawyers are likely to be particularly cautious in their judgment of prospective speculative actions means that the class of cases which is capable of being funded in this way is likely to be very small. Information received from the Faculty of Advocates indicates that approximately 1% of the Faculty's caseload is conducted on a speculative basis, the actions undertaken being mainly reparation cases in the Court of Session.
4.4 This difficulty could be overcome by adding an element to the taxed costs to reflect the speculative nature of the agreement and to reward the solicitor and counsel for the risk that they undertake in entering into the agreement. This might also encourage solicitors to be more willing to consider acting on a speculative basis than they would be if all they could recover was their taxed costs.
4.5 The percentage to be added to the taxed costs in the event of success could be subject only to the agreement of the solicitor and his client (which would transform the speculative action into something similar to the unrestricted contingency fee agreement known in the USA, which is unlikely to be in the public interest) or it could be a fixed percentage prescribed in legislation or in a professional code of conduct. It might be appropriate to fix the percentage by reference to the amount of taxed costs recoverable, perhaps by way of a small uplift, rather than by reference to the amount of damages or property recovered. This would mean that the lawyer would not have a direct financial interest in the level of damages recovered. The 'taxed costs' would not, in these circumstances, be the amount recoverable from the defendant, but the amount that the lawyer can reasonably expect to recover from his client. This approach might therefore also minimise the risk of the additional 'speculative' element being passed on to the unsuccessful defendant. Any tendency on the part of the lawyer to inflate his taxed costs, and thus his percentage uplift, could be controlled through the normal process of taxation.
A restricted contingency basis
4.6 The next relaxation, which could be in addition to the introduction of speculative actions, would be to allow lawyers and litigants to agree contingency fees, but on a restricted basis. The idea here would be that a lawyer could agree to be remunerated on a 'no win no fee' basis, recovering in the event of success some proportion of the amount of damages or property recovered. The fee could be based on a percentage of the damages recovered, and that percentage would be dependent on the stage the proceedings had reached when the case was concluded; for example, where the case is settled: prior to proceedings being issued, 25%; after proceedings have commenced but before trial, 33 1/3%; during or after trial, 40%; on appeal, 50%. Another method based on percentages would be to fix the percentage fee in relation to the scale of the damages recovered: the larger the sum recovered, the smaller the percentage charged. Different methods of fixing the fee might be appropriate to different types of action. Allowing a percentage dependent on the stage reached might, for example, be appropriate to a personal injury case, whereas a scale relating to the amount recovered might be more suitable in outstanding debt cases. 4.7 Restrictions on the amounts recoverable and on the stage at which they could be recovered could be contained in primary or secondary legislation promoted by the Government or alternatively in codes of conduct produced by appropriate professional bodies. (Even if contained in primary or secondary legislation, the restrictions might need to be reinforced by specific provisions in codes of conduct).
4.8 Even though legislation or a code could be used as the primary means of introducing restrictions on the terms which a lawyer might otherwise wish to insert in a contingency fee agreement, it might also be necessary to allow the client (and even possibly the lawyer) access to taxation in cases where it was said that the level of the fee was not a fair reflection of the amount of work undertaken on the client's behalf. The provisions of the Solicitors Act 1974 relating to the control of contentious business agreements could provide a suitable model for this. The High Court has jurisdiction under section 61 of the 1974 Act to set aside a contentious business agreement if it is of the opinion that the agreement is in any respect unfair and unreasonable. Where such an agreement is set aside the costs covered by it are taxed as if it had never been made. Powers similar to this could, if it were thought to be in the public interest, provide a long-stop against the risk that the particular circumstances of an individual case might render even the restricted rate of contingency fee unacceptably large, especially where it is considered that the lawyer has not in the event made a significant contribution to the success of the action.
An unrestricted contingency basis The ultimate relaxation would be to remove all existing restrictions on the use of contingency fees and put nothing in their place. It is considered that this would not be in the public interest. The litigant is in a weaker position than the lawyer in negotiating the terms of a contingency fee agreement since he does not have the latter's expert knowledge of the likely costs of legal proceedings. It would be inappropriate, therefore, to allow the lawyer to require payment of unreasonably high fees, when the litigant's desire to get his case on and his ignorance of costs matters may together mean that he is unable to reach a balanced view of the likely advantages and disadvantages of litigating on a contingency basis.
Legal aid
The arguments in favour of some relaxation of the existing restrictions on the use of contingency fees are often put forward as a consequence of concern about the position of those would-be litigants whose means take them out of the scope of the legal aid scheme, but who are nevertheless unable to fund the costs of litigation. It is for consideration whether the ability to use contingency fees, if these are permitted, is to be available regardless of whether the litigant would also qualify for legal aid.
Lawyers who act under legal aid certificates are paid out of the legal aid fund on what is known as the 'standard basis'. A lawyer being paid directly by a private client will however, claim his fees on the higher 'indemnity basis'. There are, it is said, some lawyers who are unwilling to act on a legal aid basis. It is possible that these lawyers would, however, be prepared to act on a contingency basis. A litigant who might otherwise qualify for legal aid might, therefore, prefer to instruct the lawyer of his choice to act on a contingency basis.
4.12 There are, however, advantages enjoyed by the legally aided litigant which he would lose if he chose to instruct his lawyer on a contingency fee basis. It is true that the legally aided litigant, if successful, has to meet out of the damages awarded to him the sums paid out of the legal aid fund on his behalf, but although there is perhaps an analogy here with the contingency fee arrangement, it must be remembered that the legally aided lawyer will be paid by the fund on the standard basis, which might amount to a smaller sum than would be payable under a contingency fee agreement. The legally assisted litigant also receives a certain protection against having to pay his opponent's costs in the event of the latter's success. A contingency fee agreement would be more favourable only if the lawyer had also agreed to pay the opponent's costs in the event of failure. There is, therefore, a risk of a conflict of interest arising where the client qualifies for legal aid but the solicitor would prefer to act on a contingency fee basis. In some circumstances the client may, however, prefer to proceed on a contingency basis, for example where a high legal aid contribution is required. From the client's point of view a contingency fee agreement would defer the payment of costs to the end of the case. It is for consideration, therefore, how any arrangements to introduce contingency fees should operate alongside the legal aid scheme.
The judges Consideration has already been given in this paper to the question whether the existence of contingency fee agreements would encourage judges to enhance awards of costs to successful plaintiffs. It is not clear whether there is a real danger of enhanced awards. If there is, the solution would be, probably through rules of court, to provide that the trial judge was not to be told whether the plaintiff's lawyers were acting on a contingency basis.
The costs rule
One significant difference between the U.S. jurisdictions and the position in England and Wales is that litigants here are, if unsuccessful, normally obliged to pay their opponent's costs. It is likely that the existence of this rule already acts as a deterrent against would-be plaintiffs with questionable causes of action. It is therefore not thought desirable that it should be removed, even if some form of speculative or contingency fee is to be allowed. Given that the introduction of contingency fees could be of benefit only to plaintiffs, it would not be appropriate to remove the protection the costs rule affords defendants against being the victims of questionable proceedings. The defendant to a civil action cannot sensibly refuse to take part in proceedings brought against him and may not easily be able to defend them as a litigant in person. The very fact, however, that he is a defendant means (except where there is the possibility of a counter-claim) that he will not have access to contingency fees, since success for him means only that he has avoided a claim for damages. 4.15 There is no prospect of lawyers wishing to act on a contingency basis in criminal proceedings (97% of defendants in the Crown Court are, in any event, legally aided), but even if any were, it is thought that this would be inappropriate on grounds of public policy. Comments are invited on whether there are other types of proceedings in respect of which speculative or contingency funding would be inappropriate. CHAPTER 5 - CONCLUSION
5.1 Examination of the arguments and issues arising in the debate on the introduction of contingency fees suggests that it is time to consider at least some relaxation of existing restrictions. The experience in the United States of America, however, gives pause for thought. Contingency fees are argued to have encouraged litigation there; and they have certainly imposed significant costs on business in the USA. These experiences need to be balanced against the argument that contingency fees make justice more readily available to a wider section of the population than is the case in England and Wales.
5.2 Closer examination of the systems operating in England and Wales and in the USA suggests that there are differences which may go a long way towards explaining the frequency of litigation and the high level of awards of damages in the USA. If contingency fees were introduced here under the current rules of court, with judges and not juries determining the amount of damages awarded, and with the rule that "costs follow the event" operating as at present, it might be possible to avoid the adverse effects of contingency fees as they presently operate in the USA.
5.3 The Government believes that it is appropriate to consider the introduction in England and Wales of speculative actions on the Scottish model. It is for consideration also whether this should be coupled with the ability to agree an uplift in the costs, payable to the lawyer in the event of success. This would offer an incentive to lawyers to undertake speculative actions. This would be a small, prescribed percentage of the costs, which was unrelated to the amount of the damages or property recovered in the action. A variant on this could be to allow the lawyer to recover instead a small, prescribed percentage of the amount of damages.
5.4 The Government does not believe that it is appropriate to remove all existing restrictions on the use of contingency fees. The Government does, however, invite views on the proposals in the previous paragraph and on the question whether a restricted form of contingency fee going beyond that suggested in paragraph 5.3 should be introduced in England and Wales. There is no objective evidence available to support the contention that the introduction of a contingency fee system in England and Wales would alone lead to the problems perceived in the USA. The Government would, however, welcome comments on this issue. The Work and Organisation of the Legal Profession
Contents
Chapter 1 The purpose of the Green Paper Access to legal services Efficiency of service Quality of service Competition and standards General competition policy Competition and the legal profession
Chapter 2 The provision of legal services today Definition of legal services Providers of legal services Areas of use of legal services Funding of legal services
Chapter 3 Legal education and the growth of specialisation The objective of legal education The growing importance of specialisation Existing specialist panels of solicitors Merits of specialist panels Increasing the supply of specialists Advertising of specialisms Exclusive specialisms Recognition of specialisms The Lord Chancellor's Advisory Committee on Legal Education and Conduct
Chapter 4 The maintenance of professional standards Standards of conduct Complaints and discipline Legal Services Ombudsman
Chapter 5 Advocacy The case for restricting rights of audience Obtaining rights of audience Lay advocacy Employed lawyers Role of the Advisory Committee Advocacy certificates Transitional arrangements
Chapter 6 Immunity from actions in negligence in advocacy work
Chapter 7 Attendance on counsel
Chapter 8 Direct access to counsel Contractual relations Direct access
Chapter 9 Queen's Counsel
Chapter 10 The judiciary Basis of judicial appointments The House of Lords Supreme Court Judges Masters and Registrars
Chapter 11 Barristers practices Pupillages Tenancies Chambers Partnerships Incorporation Clerks
Chapter 12 Multi-disciplinary and multi-national practices Multi-disciplinary practices Multi-national practices
Chapter 13 Advertising and information
Chapter 14 Probate
Annexes
A Competition in the EC B The providers of legal services C Academic and vocational training D Present arrangements of the Bar and the Law Society for handling complaints E Rights of audience in the courts of England and Wales CHAPTER 1 - THE PURPOSE OF THE GREEN PAPER
Objectives
1.1 Access to legal services The Government's overall objective in publishing this Green Paper is to see that the public has the best possible access to legal services and that those services are of the right quality for the particular needs of the client. The Government believes that this is best achieved by ensuring that:
(a) a market providing legal services operates freely and efficiently so as to give clients the widest possible choice of cost effective services; and
(b) the public can be certain that those services are being supplied by people who have the necessary expertise to provide a service in the area in question.
1.2 Efficiency of service The Government believes that free competition between the providers of legal services will, through the discipline of the market, ensure that the public is provided with the most efficient and effective network of legal services at the most economical price, although the Government believes that the public must also be assured of the competence of the providers of those services.
1.3 Quality of service The Government believes that the key element in ensuring an adequate quality of service to the public is the identification of the education, training, qualifications and standards of competence and conduct which are appropriate for those who practise in each area of legal services. The expertise required of practitioners should be neither less nor more than the needs of the work demand, so as to ensure both that the public can be satisfied as to the competence of the providers of legal services and at the same time that they can choose from the largest possible number and spread of such competent providers. Depending on the area of legal services in question, such providers may or may not need to be lawyers.
Competition and standards
1.4 Competition does not obviate the need to maintain the standards and integrity of the legal profession in order to safeguard the public. Safeguarding the public interest is particularly important in relation to the legal profession, especially with regard to work in the courts. The question is what balance between competition and regulation is most likely to achieve this effect. The onus should be on those who support restrictions as a way of achieving standards to justify them. The Organisation for Economic Co-operation and Development's report, "Competition Policy and the Professions", published in 1985, concluded:-
"Experience indicates that actions to promote competition in some professions do not necessarily jeopardise the quality of the services provided, and that many traditional practices excessively restrain competition and may promote the interests of the profession and not the public."
One of the purposes of this Green Paper is to explore the appropriate balance in respect of the legal profession; and it is against these criteria that the existing practices and structure of the profession should be judged.
General competition policy
1.5 The promotion of competition is one of the Government's fundamental policies. It is central to the achievement of some of the Government's most important objectives. Competition improves the provision of goods and services in the interests of industry, commerce, the professions and the consumer to stimulate an efficient, wealth-producing and growing economy which can create the prosperity essential to meet the needs and demands of the community.
1.6 When effective competition is lacking, clients' choice is artificially constrained. When there is effective competition, a customer is able to choose the goods or services he needs according to what represents best value in his circumstances in terms of quality and price. Suppliers have to compete on price; and this in turn encourages greater efficiency and the development of new markets. Practices which distort or restrict competition can deprive the customer of these benefits. In particular clients need to know what services are available in order to make an informed choice between them.
1.7 Both the increased emphasis on allowing market forces to determine the allocation of resources in the economy and the changing nature of the market for professional services prompt a re-examination of the special status of the professions in UK competition law. Although the Fair Trading Act 1973 largely applies to the professions, many professions are currently exempted from the restrictive trade practices legislation. In March 1988, the Government published a Green Paper "Review of Restrictive Trade Practices Policy" (Cm 331) foreshadowing new legislation. The paper stated that "there will be no exemptions for professional services automatically carried across into new legislation without the merits of each exemption having been established afresh."
The consultation period on the March 1988 Green Paper ended in September 1988, and detailed proposals for the reform of the restrictive trade practices legislation will be published shortly. As the new policy will have a considerable bearing on the legal profession, it seems appropriate to clarify the Government's general intentions in the present Green Paper. The Government has concluded that there should be no exclusion for the professions from the new legislation and that the rules of professional bodies should generally be subject to the same tests administered by a new competition authority as other sectors of the economy. The Government's view is that, like Article 85 of the Treaty of Rome, the legislation should prohibit agreements which have the effect of restricting or distorting competition, although in the case of restrictions directly imposed by statute the competition authority would be able only to offer its view on the economic effect of the restriction. Where the authority found that an agreement infringed this prohibition, it could nevertheless grant an exemption if it believed the agreement made a sufficient contribution to economic or technical progress and that consumers shared adequately in the benefits of this. In due course, therefore the Law Society and the Bar Council will have to examine their rules and guidance not only in the light of the recommendations in this Green Paper, but also in the light of the tests to be applied by the new competition authority. Competition and the legal profession
1.9 In the law as in other professions there are a number of restrictions. Many of these have been defended on the ground that they protect the interests of the client. Competition has often been regarded as inappropriate to or even incompatible with professional status and standards and with consumer protection. Regulation in the legal profession has been achieved through a combination of direct statutory control and, more frequently, self-regulation through the profession's own rules. Areas such as establishment in the profession, advertising, setting of fees and charges and business structure and access to the public have often been controlled by regulation rather than being subject to market forces.
1.10 In recent years there have been a number of changes, some resulting from recommendations by the Monopolies and Mergers Commission following references under the Fair Trading Act. For instance, licensed conveyancers have been allowed to compete with solicitors in England and Wales for conveyancing work; and advertising restrictions by solicitors have been considerably relaxed. Surveys suggest that the result of this increase in competition has been a reduction in the price of conveyancing. The Government believes that there is no reason for excluding the legal profession from the discipline of competition that applies to the rest of the economy, provided that the interests of justice and the needs of those who use or are affected by the law are safeguarded; and indeed there are wide areas of the profession where competition already operates.
EC implications 1.11 The Government takes the view that, whatever steps may be taken to give effect to the proposals in this Green Paper, the UK must ensure it avoids introducing any new restrictions which might breach the European Community Treaty. Annex A deals with the possibility of an increase in competition for the provision of legal services from European lawyers which may in any event result from the changes to be brought about in 1992 by virtue of the Single European Act.
The timing of this review
1.12 The Government reached the decision(^1) that it was appropriate to undertake this review now in the light of the Report "A Time for Change" presented to the General Council of the Bar and the Council of the Law Society in July 1988 by the Committee on the Future of the Legal Profession (the Marre Committee), a committee which those two bodies had set up in 1986. That Report, commissioned by the two major professional bodies whose members work in legal services, was the first reappraisal of the organisation of the legal profession since the Royal Commission on Legal Services (the Benson Commission) published its Report(^2) in October 1979. The Marre Committee's Report indicated a number of areas where change might now be appropriate. The fact that the two major professional bodies had agreed on the need for such a study, taken together with the conclusions of the report, in turn led the Government to the view that the time was now right for it to undertake its own fresh review of the provision of legal services to ensure that the needs of clients and the interests of justice would best be safeguarded in the years ahead.
(^1)(announced in Hansard 24 October 1988, col 1466)
(^2)(Cmnd 7648) Consultation
1.13 The Government hopes this examination of the legal profession will be publicly regarded as a matter of great importance. These are not matters of concern only to lawyers. The public have a vital interest from many different points of view. The Government will therefore welcome comment from as broad a range of opinion as possible. At the same time, the Government recognises that many of the features of the legal profession have been the subject of recent extensive debate. In the case of some of these features the Government will, therefore, in this Green Paper also be indicating its own provisional view on the right way forward.
1.14 The Government would welcome comments on the proposals in this document by 2 May 1989. Submissions should be addressed to:
Room 417 Lord Chancellor's Department Trevelyan House 30 Great Peter Street London SW1P 2BY CHAPTER 2 - THE PROVISION OF LEGAL SERVICES TODAY
The definition of legal services
2.1 A comprehensive definition of what is meant by legal services is very difficult to frame, but, broadly speaking, legal services are concerned with the advice, assistance and representation required by a person in connection with his rights, duties and liabilities. These may of course change over the years with the prevailing values of society, the legislative will of Parliament and the decisions of the courts. Most services which are "legal", in the sense that a lawyer often performs them in the ordinary course of his practice, may also be performed by non-lawyers. In England and Wales the only legal services which are by law reserved specifically to lawyers are handling cases in court and applying for grants of probate or letters of administration for reward. These matters are considered further in Chapters 5 and 14.
2.2 In addition, conveyancing for reward is restricted to lawyers, licensed conveyancers and certain public officials. Solicitors used to have an effective monopoly in the provision of conveyancing services but this monopoly was abolished by Parliament in 1985, when licensed conveyancers were allowed to enter the conveyancing market in direct competition with solicitors. Conveyancing by solicitors and licensed conveyancers employed by institutions and bodies whose main business lay in another field was not, however, allowed at that time, although a framework for this was subsequently enacted (which has not yet been brought into force) in the Building Societies Act 1986. Accordingly the Government has thought it right to re-examine this field as part of this review; and a separate consultation paper on the subject of The providers of legal services
2.3 The Government believes that access to legal services by those who need them is fundamental to the rule of law and the preservation of liberty. It is important to recognise, however, that such access does not necessarily mean access to a lawyer. Much depends on the level and type of legal service required. In some cases a friend or advice agency may suffice; in others advice by one who is not only a lawyer but also a specialist lawyer, such as a patent lawyer, may be essential. Annex B contains background information on some of those who provide legal services, including barristers and solicitors.
2.4 A person requiring advice, assistance or representation needs to be satisfied that the practitioner or agency from whom assistance is sought is competent to deal with the matter in issue. Clients are not usually in the best position to judge competence, particularly if the matter on which advice is sought is complex and the practitioner whom they have approached is held out to have expertise in the area in question. This will be particularly relevant where the practitioner approached is a lawyer. The Government believes that it is a matter of public interest that practitioners holding themselves out as professional lawyers are nationally recognised as having standards on which the public can rely. This means that lawyers must have appropriate qualifications for the work they undertake; must abide by recognised standards for doing this work; and must be subject to effective monitoring to ensure that the work is properly done. Areas of use of legal services
2.5 A few examples of areas where legal services may be needed are set out below by way of illustration. These are:
(a) the home; (b) the family; (c) employment; (d) social welfare; (e) consumer protection; (f) commercial and financial operations; (g) accidents and compensation for personal injury; and (h) involvement with the criminal law.
(a) The home Conveyancing services are available from a solicitor or licensed conveyancer (see para 2.2 above). Advice in connection with the mortgage and insurance cover may be provided by a solicitor, but may also be provided by a building society, bank, accountant or other financial adviser. Disputes arising in connection with the property, for instance with landlords or neighbours, can sometimes be resolved amicably, perhaps with the assistance of a friend as mediator. If this is not possible, a citizens advice bureau (CAB) or law centre may be able to help. If the dispute is so serious that it becomes necessary to take legal proceedings it is likely that advice will be required from a lawyer.
(b) The family A person may need advice, assistance or representation in connection with marriage or divorce, or with matters relating to children, elderly relatives, welfare benefits, pensions or wills. He or she may in many instances turn to friends, advice agencies such as the CABx or the National Society for the Prevention of Cruelty to Children, to social workers or to financial advisers. In more difficult cases, or where disputes may come before the courts, a person is likely to seek the assistance of a lawyer.
(c) Employment Legal services may be needed in connection with a variety of matters such as contracts of employment, conditions of work, racial and sexual discrimination, industrial action, unlawful behaviour by trade unions, redundancy or dismissal. Employees, potential employees and employers are all likely to need legal services here. Depending on the nature of the advice, assistance or representation required they may turn, for example, to trade unions, trade associations, CABx, the Commissioner for the Rights of Trade Union Members, the Advisory Conciliation and Arbitration Service, the Commission for Racial Equality, the Equal Opportunities Commission or to lawyers.
(d) Social welfare A person may need advice, assistance or representation in connection with entitlement to welfare benefits or the resolution of problems caused by homelessness or nationality. Advice agencies, such as the CABx, the Child Poverty Action Group and the United Kingdom Immigrants Advisory Service, have developed an expertise in welfare areas such as these. Help may also be provided by law centres, social workers and lawyers.
(e) **Consumer protection** Legal services here can cover a wide area ranging from rights and liabilities in connection with the purchase and sale of goods and services and the whole area of product liability at one end, to counselling for debt at the other. Advice and assistance may be available from organisations such as the National Consumer Council, the Consumers' Association, CABx and other advice agencies and trading standards officers. As in the other examples, a lawyer is most likely to become involved if complex commercial documentation is required or court proceedings are contemplated.
(f) **Commercial and financial operations** Legal services here can cover such matters as setting up and running a business or company, taxation, bankruptcy and insolvency, intellectual property rights, commercial conveyancing, pensions, insurance, matters of contract, the financial regulation of markets and the effect on transactions of multi-national operations. A range of practitioners are in the market for the provision of legal services in some or all of these areas, including lawyers both general and offering a variety of specialist services, licensed conveyancers, patent agents, banks, building societies, accountants, insolvency practitioners and chartered secretaries.
(g) **Accidents and compensation for personal injury** Accidents may give rise to both civil and criminal liability. Legal services are likely to be needed both by any person who may have caused the accident and by the person who is injured as a result of it. Legal services here are likely to be provided by a lawyer, if the matter seems likely to become the subject of court proceedings, but advice and assistance may also be available from other sources such as trade unions or advice agencies.
(h) Involvement with the criminal law
Lawyers are the main providers of legal services here, especially in connection with the conduct of cases in court. Advice and assistance may, however, also be available from, for example, social workers, probation officers and advice agencies.
Funding of legal services
2.6 This chapter has looked very briefly at some of the situations where legal services are likely to be required and where the public need to have access to them. It has also mentioned some of the practitioners and agencies who may provide such services. The Government thinks it right that these services should be funded in a variety of ways. Those who cannot afford to pay for the legal services they require can often get the help they need from organisations supported by public funds; and, where necessary, they can get access to lawyers through the legal aid and advice schemes. Those who can themselves afford to pay for the services they require want to be sure they are using their money to obtain the service which is best suited to their needs. 2.7 So far as publicly funded work is concerned, the Government believes that the new Legal Aid Act, together with the Legal Aid Board it has created to take over the administration of legal aid from 1 April 1989, will provide a system that is efficient and effective and give to all concerned the best possible value in return for the money spent on it, and which will have the flexibility to meet changing demands and circumstances.
2.8 In privately funded work also the Government is keen to encourage new approaches. One idea which has attracted much attention in recent years - contingency fees - is the subject of a separate consultation paper issued in parallel with this Green Paper. The Government's proposals to increase the possibilities for advertising by the legal profession, and thereby to enable the public to make more informed and cost-effective choices among the providers of legal services, can be found in Chapter 13 of this Green Paper. CHAPTER 3 - LEGAL EDUCATION AND THE GROWTH OF SPECIALISATION
The objective of legal education
3.1 The Report of the Committee on Legal Education published in March 1971 (Ormrod) (Cmnd. 4595) concluded that:
"Legal education should not attempt to equip the lawyer at qualification with a comprehensive knowledge of every subject he may encounter in practice; instead, it should concentrate on providing him with the best possible general introduction so as to enable him, with the help of experience and continuing education after qualification, to become a fully equipped member of the profession."
The Government believes this objective for legal education is still valid today.
3.2 The Government also believes that it is consistent with its objectives for the provision of legal services that practitioners must be able to show their clients that they possess the necessary competence to perform the particular service sought from them, especially where the service requires the possession of specialist expertise. The Government believes that it is not of itself sufficient for practitioners to belong to a particular branch of the legal profession, or, in some cases, to other professions.
Current position
3.3 Entry to the legal profession requires completion of three training stages, an academic, a vocational and a practical stage. Entrants normally complete the academic stage by taking a law degree. Thereafter, barristers and solicitors have separate systems of vocational and practical training.
3.4 Both branches of the profession are in the process of conducting reviews of their own training arrangements with the aim of making these more relevant to the needs of practice. The Bar intend to introduce a new finals course in the autumn of 1989 which will emphasise practical skills such as advocacy, drafting, advising and negotiating; and there are at present moves to formalise the minimum contents of pupillage. The Law Society are considering including additional specialist law options during the finals course, training in management and communication skills and the extension of compulsory post-qualification training beyond the first three years, in order to keep solicitors abreast of developments in the law.
The growing importance of specialisation
3.5 The thrust of these changes is to emphasise the growing importance, which has been noted over the past decade, of the acquisition of specialist skills by practitioners. The need for this was recognised by the Royal Commission on Legal Services as long ago as 1979 when it recommended that the formal introduction of specialisation into the solicitors' profession would be of significant benefit to the public (paras 22.55 and 27.23). In 1987, in the White Paper "Legal Aid in England and Wales: A New Framework" (Cm 118 para 58), the Government stated that it was desirable that solicitors doing legal aid work should have special skills in the area concerned, and that it was attracted by the idea that legal aid work should be done by panels of solicitors with specialist experience in each category. In 1988 the Civil Justice Review (Cm 394 CONFIDENTIAL
para 212) recommended that specialisation schemes should be established for all the main areas of litigation; and Marre (para 16.17) recognised that "specialisation is inevitable."
Existing specialist panels of solicitors
3.6 The Law Society have already established specialist panels for child care and mental health work. The Child Care Panel was set up in 1984 and currently has around 1,500 members. The Mental Health Panel was set up in 1983 and currently has around 200 members. Membership of both these panels is dependent on experience in advocacy before the relevant tribunals, attendance on approved courses and interviews. Also under the duty solicitor schemes there are some thousands of solicitors (and their representatives) who provide duty solicitor services. They need to have a minimum of 12 months' advocacy experience and are interviewed by local practitioners to confirm their suitability. The Law Society are also currently considering the extension of specialist panels into other areas of work such as planning, personal injury and medical negligence.
Merits of specialist panels
3.7 The main advantage of specialist panels to the public is to give them an easier and more informed choice of practitioners who they can be assured are skilled in a particular field of law. At the same time, not every area of law requires specialist expertise. Care must be taken to ensure that only those areas of law which need to be specialisms are designated as such, and that the criteria for recognition as a specialist are high enough to ensure competence and maintain standards but no higher. The criteria must not become unnecessary obstacles which discourage practitioners from becoming specialists, or which artificially limit the supply of legal services to the public in a particular field.
Increasing the supply of specialists
3.8 The Government considers that the way to ensure that the expertise of practitioners is best matched to the particular demands of the work in question, and that the public has the widest possible choice of competent practitioners in the various fields of law, is for areas of specialist expertise to be developed, with standards of education, training, qualifications and conduct appropriate to each. It may be that some of these specialisms will not require the services of lawyers. The following questions then arise:
(a) which areas of work require specialist expertise; (b) what is the appropriate level of education, qualifications and training required to be a specialist in any given area; (c) who is to provide the necessary education, qualifications and training; and (d) how are appropriate standards of conduct to be set for practitioners and who is to monitor these standards.
These questions are addressed in paras 3.11 to 3.13 below and in Chapter 4.
Advertising of specialisms
3.9 An important purpose of specialisms is to provide the public with more information to help them choose a practitioner appropriate for their needs. Accredited specialists should therefore be able to advertise themselves as such to the general public. The Bar and the Law Society already operate a limited form of advertising through listings in their professional directories; and the Law Society permits also the circulation of lists of members on, for instance the Mental Health Panel, to interested organisations such as CABx, social services departments, psychiatric units and the courts. Further consideration should, however, be given by both individual practitioners and the relevant professional bodies to allowing those practitioners who qualify as specialists (see also Chapter 13 below) to advertise themselves as such. This does not mean that non-specialists should not be allowed to advertise their services; merely that only those who are recognised specialists in a particular field should be able to hold themselves out as such to potential clients.
Exclusive specialisms
3.10 The Government does not believe that practice in an area which has been designated as a specialism should be restricted to those recognised as specialist practitioners alone. Such an approach could create new entry barriers, put up costs, deprive clients of choice and protect those within the specialism from competition from those outside it. An exception is advocacy, where the Government believes that the needs of the administration of justice require special arrangements to be made. This is considered in Chapter 5 below.
Recognition of specialisms
3.11 The Government believes that a formal mechanism should be established to advise on the matters outlined in para 3.8. The Government believes also that, in order to ensure that the public know that recognition as a specialist practitioner has real value, the requirements for the education, training and qualifications of recognised providers of specialist services should in future be approved by the Lord Chancellor, after he has taken advice from his Advisory Committee on Legal Education. The arrangements for codes of conduct are set out in Chapter 4. The Government expects there will in future be a variety of providers of such specialist services.
The Lord Chancellor's Advisory Committee on Legal Education and Conduct
3.12 The Lord Chancellor's Advisory Committee on Legal Education (the Advisory Committee) was set up in 1971 as a result of recommendations in the Report of the Committee on Legal Education (Ormrod, Cm 8595). In order that it may carry out the new functions the Government now proposes for it, the Advisory Committee should be reconstituted as a vigorous and active standing committee, dealing with both education and conduct, which would meet regularly. To accord with its new role this Committee should in future be known as the Lord Chancellor's Advisory Committee on Legal Education and Conduct. The Committee's terms of reference should be:
(a) To keep under review the education and training of lawyers at the academic, vocational and post-vocational stages to ensure that that education and training is relevant to the needs of practice and to the efficient delivery of legal services to the public. (A possible framework for the academic and vocational training of lawyers is set out at Annex C, which the Advisory Committee would be invited to consider at an early stage);
(b) To consider, whether on its own initiative or when requested to do so by the Lord Chancellor: what areas of legal services require specialist expertise and whether that specialist expertise needs to be provided by a fully trained lawyer; and what the education, qualifications and training of specialists, both legal practitioners and others, should be in the various areas designated as requiring specialist expertise;
(c) To keep under review, whether on its own initiative or when requested to do so by the Lord Chancellor, the accredited specialisms and the education and training requirements for these to ensure that they continue to meet the needs of the public for the efficient delivery of legal services; and
(d) To advise the Lord Chancellor on the appropriate codes of conduct which should be followed by lawyers and other practitioners recognised as suitable to undertake work in the recognised specialisms. (It is envisaged that at least two separate codes of conduct will be needed to cover:
(i) advice work; and (ii) advocacy.
This last area is considered further in Chapter 4.)
The Advisory Committee should submit an annual report covering all these areas to the Lord Chancellor. The annual report would be laid before Parliament. The Committee might also submit proposals and recommendations to the Bar or the Law Society or to other professional bodies, where it considers this appropriate or where such bodies ask for its advice. Final decisions on whether a particular specialist area of expertise should be recognised as such and on what standards of education and training are appropriate in each case should rest with the Lord Chancellor, following advice from the Advisory Committee. In addition, before recognising any particular professional body as competent to authorise individual practitioners as specialists in a particular field, the Lord Chancellor would have to be satisfied that the professional body could:
(a) provide the appropriate education and training, either itself or, on a repayment basis, with the assistance of appropriate educational establishments; and
(b) provide sufficient control over its members to ensure that satisfactory standards of conduct and behaviour are maintained and enforced (This is considered further in Chapter 4).
It would of course be for the various interested professional bodies to decide what they wished to offer by way of education, training and discipline in the light of the standards set by the Lord Chancellor for the various specialisms.
Under the proposals outlined above, the Advisory Committee will in future play an important role, both in ensuring the supply of legal services of quality to the public and in maintaining the standards of conduct expected of practitioners. The Government believes that the composition of the Advisory Committee should reflect this new role by containing a majority of lay members. Accordingly the Government proposes that the new Advisory Committee should consist of 15 members, all appointed by the Lord Chancellor and comprising:-
(a) a chairman, who should be a judge; (b) 2 barristers appointed after consultation with the General Council of the Bar; (c) 2 solicitors appointed after consultation with the Council of the Law Society; (d) 2 academic representatives - appointed after consultation with those representing the university and polytechnic law schools; and (e) 8 lay representatives appointed after wide consultation.
3.15 The Government proposes that the secretariat of the Advisory Committee should be provided by the Lord Chancellor's Department.
Summary 3.16 The Government would welcome views on the proposals in this chapter, in particular on:
(a) the proposed terms of reference of the Advisory Committee;
(b) the proposed membership of the Advisory Committee; and
(c) the suggestions for academic and vocational training set out at Annex C. CHAPTER 4 - MAINTENANCE OF PROFESSIONAL STANDARDS
4.1 The Government believes that it should be the duty of any professional body to ensure that the standards of competence and professional conduct among persons who practise in that profession are sufficient to secure adequate protection for clients, and that the services provided by such persons are provided both economically and efficiently.
4.2 This means that such a professional body must ensure that:
(a) professional services are offered efficiently and with the required degree of professional expertise;
(b) any complaints about services are investigated promptly, thoroughly and impartially;
(c) matters are put right as quickly as possible with, where necessary, appropriate recompense;
(d) where a professional man or woman fails to meet the required standards, appropriate action is taken; and
(e) where the failure amounts to professional misconduct, appropriate sanctions are imposed, if necessary amounting to expulsion from the profession.
4.3 The Government believes that those who provide the public with legal services must do so in a competent and professional manner. It should therefore be one of the functions of the legal professional bodies to ensure this happens.
(A) Standards of conduct
Present arrangements
4.4 At present the Bar and the Law Society provide for standards of conduct in different ways:
(a) The Bar
4.5 The Bar has a written Code of Conduct. Last year it was thoroughly revised. The new version is due to come into force on 1 February 1989. It sets out the general principles which apply to all barristers, whether in independent practice or in employment, including their general duties, the rules on acceptance of instructions and on withdrawal from a case, the duty of the barrister to the client, the way a case should be conducted both in and out of court, and what is to happen when a conflict of interest arises.
(b) The Law Society
4.6 The Law Society publishes Practice Rules. The current rules are the 1988 Practice Rules which govern, for example, obtaining instructions, accounting for commissions and the supervision of a solicitor's office; and when a solicitor may act for both vendor and purchaser. Referrals and introductions and publicity are also touched on briefly in the Rules but are dealt with in more detail in separate codes. The Rules do not, however, provide for matters of good practice such as proper communication with the client and the avoidance of delay.
4.7 The Law Society publishes a guide called "The Professional Conduct of Solicitors" to deal with these matters of practice. This contains detailed statements of principle together with an indication of best or acceptable practice. Although such an explanation of these principles is obviously helpful, it remains odd that what is intended to lead to sound practice does not appear in the Practice Rules, especially as any breach of these principles might put solicitors at risk of allegations of inadequate professional services or professional misconduct.
Codes of professional conduct and standards
4.8 The Government believes there are certain areas of practice which are of such fundamental importance that:
(a) there should be clear written statements of the practice which must be followed;
(b) these written statements should be set out in a way which is easily accessible both to lawyers and their clients; and
(c) failure to observe these practice rules should be a cause for disciplinary proceedings.
4.9 Recommendations on these lines were made by Benson in 1979. The Civil Justice Review published in June 1988 (Cm 394) also recommended (R 18(1)) that both the Bar and the Law Society should issue specific written professional standards relating to the conduct of all principal types of litigation.
4.10 The Law Society published written standards in 1985 to cover responsibility for the client's case, communication with the client and information on costs. They appear as an appendix in "The Professional Conduct of Solicitors". The introduction to these standards states that:-
"They are guidelines. They will be helpful in all cases. It will be for the solicitor to judge when a standard can be ignored, but also for him to justify his decision should the client feel aggrieved."
The Government is not convinced that either this statement or the positioning of the standards in the Guide adequately underlines their importance.
The Bar has not yet introduced any standards of this kind, although it is about to do so.
The Government's proposals
4.11 The Government now therefore proposes that there should in future be written codes which specifically set professional standards. The Government envisages that two separate professional codes will be necessary. One will deal with the provision of legal advice and assistance generally. The other will cover the particular issues which are connected with the handling of briefs and the general conduct of cases in court, since in advocacy work the maintenance of standards both of skill and integrity has much to do with the independence of the advocate, his regular application to his work in the courts, and with his need to satisfy the requirements of a client able to make an informed choice of advocate. The areas to be covered are set out in broad terms in paras 4.14 and 4.15 below. The Lord Chancellor will look for advice on what should be the principles embodied in these codes from his Advisory Committee on Legal Education and Conduct, whose membership and terms of reference will be broadened so as to encompass this function (see Chapter 3, paras 3.12-3.15 of this Green Paper). Professional bodies whose members wish to offer advisory and advocacy services will be required to submit their proposed codes of conduct for the endorsement of the Advisory Committee whose role it will be to ensure that such codes of conduct embody the approved principles.
4.12 The Government proposes that the Lord Chancellor should prescribe by statutory instrument the principles which must be embodied in these codes so as to ensure that they have Parliamentary approval. The Government is not prepared to leave it to the legal profession to settle the principles which these codes should adopt because they will be of such great importance both to the administration of justice and to the public. Moreover, in the future the legal profession is likely to continue to contain a number of different professional bodies; and it is important that they should all be subject to minimum professional standards.
4.13 A code setting out the approved general principles would be a requirement for any profession whose members offered legal advice for reward; and a code dealing similarly with the conduct of cases in court would be a requirement for all advocates (see Chapter 5 below). The relevant professional bodies would be expected to enforce the codes and to satisfy the Advisory Committee that they had adequate arrangements in place for this purpose. Failure to comply with any requirement of the codes would render a practitioner liable to a range of sanctions including a reduction in fees after proceedings conducted by the appropriate professional body. In addition all courts should have power to require any advocate to pay personally costs incurred by any party to an action, if the court judged this appropriate.
Code 1 Provision of legal advice and assistance
4.14 A client seeking advice and assistance should be given full and proper advice about his case. Poor communication seems to be the cause of most complaints about solicitors. This code will therefore need to provide that:-
(a) the client is given a full explanation of the issues and what needs to be done;
(b) the client is kept fully informed about the progress of his case;
(c) the client is given a proper explanation of the fees and costs likely to be incurred: this explanation should be supplied both orally and in writing;
(d) the client understands who is responsible for the overall supervision and the day to day handling of his case; and
(e) the practitioner conducts the case in an efficient manner.
Code 2 Advocacy and ancillary matters
4.15 This code will need to ensure that:-
(a) incoming work is managed in chambers or offices in such a way that there is adequate pre-trial preparation of cases; and that in particular:- (i) early conferences are arranged when necessary;
(ii) in criminal cases there is careful advice about the intended plea, in order to avoid changes of plea at the trial so far as possible;
(iii) where possible, issues in dispute are identified before trial; and
(iv) cases are properly prepared for court;
(b) cases in court are conducted competently and in the light of clear ethical standards so that:-
(i) advocates are aware of the paramountcy of their duty to the court, their duties to the client, to witnesses and to third parties; and
(ii) advocates do not waste the time of the court; and
(c) defence and prosecution advocates are aware of their special responsibilities in criminal cases; in particular that advocates who provide representation in the more serious cases which are tried in the Crown Court should not, in any given case, have been involved also in the investigation of the evidence.
(B) Complaints and discipline
Present arrangements
(a) The Bar 4.16 A barrister is immune from an action for negligence brought by a client in respect of the conduct and management of a case in court (see Chapter 6 below). He or she is not, however, immune from actions for negligence in other situations. Indeed all practising barristers are required to have professional indemnity insurance of £250,000 for each and every claim. A barrister is also subject to professional discipline in respect of the conduct of a case whether in or out of court.
4.17 Complaints against barristers come largely from members of the public, although some come also from the judiciary or magistracy, court officials, other barristers and solicitors. The present machinery for dealing with complaints is set out in Annex D, Part 1.
(b) The Law Society
4.18 All solicitors in practice are required to be covered by professional indemnity insurance against loss arising from civil liability claims. In addition the Law Society administers a fund to provide compensation in cases of dishonesty by solicitors or their employers or of failure by a solicitor to account for any money in connection with any trust of which he or she is or was a trustee. These arrangements go wider than those covering barristers, but barristers do not need such wide protection because they do not carry out transactions on behalf of clients or handle clients' money.
4.19 Complaints against solicitors may raise issues of conduct or inadequate professional services - "shoddy work." Such complaints must be made to the Solicitors' Complaints Bureau where most will be settled. A minority of complaints will, however, be considered also by the Solicitors' Disciplinary Tribunal, the High Court or the Lay Observer. The details of these arrangements are set out in Annex D, Part 2.
Criticism of existing procedures: the Law Society
4.20 Criticism of the complaints procedures has been directed largely at the Law Society. It is not surprising that there are more complaints about solicitors than barristers. There are ten times as many solicitors in practice. Furthermore, solicitors have a more direct and longer term involvement with their clients. In 1987 the Solicitors Complaints Bureau (SCB) received in excess of 17,800 complaints, while the Bar only received perhaps 1% of that number.
4.21 The SCB was set up in 1986. Previously complaints had been handled by the Law Society's Professional Purposes Department; and this arrangement had attracted criticism on the ground that it could not be shown to be sufficiently impartial. Both the Bar and the Law Society combine the roles of supervision and professional representation. It is obviously easier to demonstrate the independence and impartiality necessary for handling disciplinary cases when the two roles are split (as for example is the case with the General Medical Council and the British Medical Association). The Law Society appear to have hoped that, by setting up the SCB in a separate establishment, with a lay-dominated Investigation Committee to monitor its performance, they would, notwithstanding that they fund the SCB, enable it to be regarded as independent of the Law Society. It is not clear that they have as yet been successful in this.
Problems with the Law Society's present arrangements 4.22 The Government considers that problems lie particularly in the following areas:
(a) The definition of shoddy work
4.23 The Law Society's investigation of complaints was confined to matters of conduct until the beginning of 1987, but it may now also, under powers granted by the Administration of Justice Act 1985, investigate complaints about inadequate professional services, which are often described as "shoddy work". The Chairman of the Adjudication Committee in the first report of the SCB explained that his committee had been in difficulty in identifying what the expression "shoddy work" might cover. The Government believes the difficulty does not arise only because this is a new jurisdiction, but also because it is at present difficult to identify what precise standards solicitors are expected to meet. The Government suggests that the adoption of clear standards in a written code of conduct will make the task of the Adjudication Committee easier.
(b) Negligence cases
4.24 The SCB is unwilling to take action where it appears that the complaint raises a question of negligence as opposed to professional misconduct. It explains the two expressions as follows:-
(i) "Negligence is a civil 'offence' where the solicitor has been inadvertently incompetent. In negligence the solicitor is in breach of his duty of care to the client and as a consequence the client has suffered loss in money terms."
(ii) "Professional misconduct is [broadly] wilful misbehaviour by a solicitor which may involve disregarding certain rules of conduct or may be of a type that could bring the profession into disrepute in dealings with a client. It may now include incompetence falling short of negligence."
4.25 The SCB explains that it cannot act in negligence cases because "negligence is a matter of law, which must be settled in the last resort by the courts." Instead, when the SCB identifies a possible negligence case, it sends the complainant to a solicitor on one of its negligence panels.
4.26 In his 1987 report (Cm 626) the Lay Observer comments at para 47:-
"Even if a solicitor might have been negligent, would it not be appropriate in some cases to deal with the complaint under the shoddy work powers rather than by proceedings for negligence, for example where a reduction in the bill is likely to be the appropriate remedy."
The Government agrees with this and also with the Lay Observer's comment elsewhere in his report that the Law Society needs to consider how far the investigation of complaints is hampered by solicitors who refuse to co-operate on the grounds that this might prejudice their case in proceedings. Such prejudice is not inevitable. In some cases, a finding of shoddy work will result in financial recompense and settlement. In others the finding will help to demonstrate a poor performance but will not necessarily imply that the performance was caused by negligence. The possibility of court proceedings should not be used as an excuse to prevent or delay making right what has gone wrong, especially when the damage is perfectly clear. (c) Confusion of choice
4.27 A complaint may raise issues besides shoddy work or negligence, where there are several ways to take the issue forward. For example, in some cases where it appears that the solicitor's fees are too high, it is possible to apply either to the Law Society for a remuneration certificate or to the Court for taxation. The Government agrees with the Lay Observer that the Law Society needs to make more effort to explain to the public the nature of its various powers and the relationship between them.
(d) Delay
4.28 The SCB admits that its handling of complaints is often subject to delay. This may be due partly to its high workload and partly to solicitors failing to reply to the Bureau's letters. The average shoddy work complaint at present takes six months to work through the system.
4.29 The Government expects the Law Society to take measures to cut down the number of cases which need to go through the full SCB procedure. A voluntary arbitration procedure for use in negligence cases already exists, but it is rarely used. Attempts to reach a settlement in cases where the client is concerned principally to get the work done have been more successful. The Government would like to see the Law Society encourage the development of local conciliation schemes which could cover all complaints. There are 127 local law societies. The Government believes there is scope for them to play a more active role in settling disputes between aggrieved clients and solicitors. The SCB Investigation Committee hopes that its lay element and its independence help to reduce the workload of the Lay Observer, but it seems clear that the SCB has not yet developed machinery for dealing with complaints which achieves public confidence. The Lay Observer, as explained above, has powers to examine the way complaints are handled but not to re-examine the complaint. The Government believes, therefore, that the Lay Observer's powers are inadequate. The Government considers that the Lay Observer is hampered in his work by having limited powers to take cases to the Solicitors' Disciplinary Tribunal, no powers of referral to the SCB, and no powers to reinvestigate the case or to award compensation. Finally it is anomalous that there is no equivalent office holder to review the complaints procedure of the Bar.
Accordingly the Government proposes to abolish the office of Lay Observer. Instead, the Lord Chancellor will appoint a Legal Services Ombudsman, who will have power to:
(a) examine allegations about the way complaints about barristers, solicitors or any other new legal professionals, who may establish themselves in the future, have been handled by the relevant professional body;
(b) reinvestigate cases where he considers it necessary;
(c) refer cases back to any body which originally investigated the complaint or to any disciplinary tribunal which has power to consider the complaint (this would be the normal course in the case of decisions of the High Court in respect of solicitors' conduct or decisions of the Visitors (who are judges of the High Court: see para 3 of Annex D) in respect of barristers' conduct);
(d) recommend the payment of compensation by the professional body concerned;
(e) recommend changes or improvements to the complaints procedures of the Bar, the Law Society or any other relevant supervisory body; and
(f) publicise his decisions.
Summary of proposals
4.32 (a) The Government intends to prescribe, by way of statutory instrument, clear principles and standards, for embodiment in two codes of conduct to be adopted by professional bodies, covering:-
(i) the provision of legal advice and assistance; and
(ii) the preparation of cases and their conduct in court.
Failure to observe any requirement of the principles and standards set out in these codes would be a cause for disciplinary proceedings.
(b) The Government believes that each professional body should demonstrate that it has a supervisory body to investigate complaints which can be shown to be both impartial and independent of the profession's representational body. (c) The Government intends to replace the Lay Observer by a Legal Services Ombudsman who would have greater powers to examine the handling of complaints by the Bar, the Law Society and any other legal professional body. CHAPTER 5 - ADVOCACY
Introduction
5.1 A right of audience entitles a person to address a court of law on behalf of another. In England and Wales, restrictions are at present placed, either by statute or by usage regulated by the judges, on rights of audience in all courts of law. The Government wishes to examine in this chapter whether the current restrictions on rights of audience before the courts are compatible with the key principles outlined in Chapter 1, particularly in the light of the matters discussed in Chapter 3.
5.2 A summary of rights of audience in the courts of England and Wales is at Annex E.
The case for restricting rights of audience
5.3 Under an adversarial system such as ours, the presentation of both the facts and the legal authorities on which the judge's decision will be based is the responsibility of the advocates representing the parties concerned. Judges in this country work largely without legal support, and their judgments are prepared entirely by themselves with no assistance, so far as law is concerned, except the representations of the parties. They therefore need to be able to rely on the strength and adequacy of the representations of the advocates appearing before them. An inexperienced or incompetent advocate who cannot present a case properly is not only unlikely to be able to do justice to his or her client's case, but is also likely to waste the time of the court and may by his failure bring about injustice. The ensuing delay, additional expense and inconvenience can affect not only the case in question but also other cases waiting their turn to be heard; and indeed the state of the law generally.
5.4 It is not only an advocate's competence which is important here; it is also the standards of integrity and ethical practice required of advocates which have developed over many years to ensure that the quality of justice is maintained. Judges need to be able to trust the word of the advocates appearing before them and to rely on them not to mislead the court; otherwise proof of every matter would be required, leading to unnecessary delay and inconvenience for all concerned.
5.5 It is also important to recognise that judges give judgments with reasons which can be used in other cases. Because of the doctrine of judicial precedent (under which decisions of the higher courts on matters of law are treated as binding on the lower courts), such judgments, particularly in the higher courts, play a vital role in the development of English law. It is for this reason that the judges look to the advocates appearing before them to cite all relevant authorities to the court, whether or not these authorities are favourable to their case. The presentation of cogent legal argument is a highly skilled task requiring not only a knowledge of the law but also constant practice in advocacy.
5.6 For these reasons it is necessary to ensure, in considering what the appropriate criteria are for granting rights of audience, that such rights are given, particularly in the higher courts, only to those who will not only give the right quality of service to the parties involved in a case, but who will also enable the quality of justice and the standards of advocacy to be maintained. Obtaining rights of audience
5.7 The Government considers that, for the reasons given above, rights of audience in the courts should be restricted to those who are properly trained, suitably experienced and subject to codes of conduct which maintain standards, although this should not affect an individual's right to self-representation. The Government therefore, as stated in Chapter 3, believes that advocacy in the courts should be an area where recognised professional expertise is required. Subject to that, the Government believes, in accordance with the principles set out in Chapter 1, that the public should have the widest possible choice among recognised advocates who are free to compete fairly with one another for the business available from clients.
5.8 Accordingly the Government believes that, for the future, rights of audience before particular courts should depend only upon whether advocates can demonstrate that they have the appropriate education, training and qualifications and are bound by appropriate codes of conduct. Advocates' professional bodies should have to satisfy the Lord Chancellor that their members are fit and proper people to appear as advocates before the court or courts in question in order to obtain rights of audience for them. The necessary requirements would vary, depending on the level and nature of the court concerned, and would need to be worked out in detail for each court, but the present distinctions in the treatment by the courts of the different branches of the profession would disappear. The basic premise is that the satisfaction of such requirements should, for the future, alone be the test for granting rights of audience; and not whether an advocate happened by initial qualification to be a lawyer, whether a barrister or a solicitor, and whether in private practice or employed.
Lay advocacy
5.9 Lay representatives already appear in a wide variety of proceedings; and the Government thinks that it may now be right for lay representatives to be granted rights of audience in the courts on behalf of others in some instances. The Civil Justice Review R.48 (Cm. 394) recommended that in small claims cases and debt and housing cases in the County Court, litigants should have the right to be assisted or represented by the lay representative of their choice, although the court, on giving reasons, would have the discretion to restrict the involvement of corrupt or unruly representatives, and, where necessary, to exclude them entirely. Any rights of audience granted to lay advocates would supplement, and not replace, the existing rights of those who represent themselves to have a friend in court who assists but does not represent them. In other instances, specialist practitioners who are not lawyers should be able to exercise rights of audience in perhaps a limited range of cases appropriate to their specialist expertise if they can satisfy the appropriate tests. The aim should be to ensure the widest possible choice of advocate for the client while at the same time ensuring that adequate standards of competence and probity are maintained. The whole area of lay representation should be considered by the Advisory Committee.
Employed lawyers
5.10 The Government also believes that it should be possible for appropriate codes of conduct to guard against any conflicts of interest which might arise in the case of employed lawyers; and to secure the degree of responsibility to the court and independence from the parties which is vital if the court is to rely on their representation. A universal prohibition on rights of audience for employed lawyers would therefore appear to be an unnecessary constraint.
5.11 In particular, in the case of prosecution work the Government endorses the principle recommended in the Report of the Royal Commission on Criminal Procedure (Cmnd 8092) published in January 1981 (the Philips Report) that there should be a clear separation of responsibility for the conduct of the prosecution from the conduct of the investigative process (paras 7.3 and 7.7). The Crown Prosecution Service, created in the wake of the Philips Report, clearly follows this principle since it is both independent of the police and accountable to the Attorney-General rather than the Home Secretary who has Ministerial responsibility for the police. The Government therefore considers that it is likely to be feasible as a matter of principle for lawyers employed by the Crown Prosecution Service to have rights of audience in all the criminal courts, provided that they can satisfy the appropriate advocacy requirements and undertake to abide by the relevant codes of conduct; and provided that it is adequately recognised by practical safeguards that their duty to the court must take precedence over any responsibility they may have to their employer.
5.12 So far as rights of audience for lawyers employed on prosecution work by other Government departments are concerned, and also for lawyers employed by other bodies which undertake prosecutions, consideration will need to be given to how they might meet the Philips principle, especially in the case of the more serious cases which are tried in the Crown Court, before any changes in their rights of audience are made. In the case of the prosecution work carried out by Government departments, departments would at least need to be able to demonstrate a clear structural separation in the arrangement of the department of those staff involved in investigations from those responsible for conducting prosecutions; and, in some cases, the solution might be to transfer responsibility for the lawyers who have carriage of prosecution work from the department concerned to the Attorney-General.
Role of the Advisory Committee
5.13 The Government proposes that the reconstituted Lord Chancellor's Advisory Committee on Legal Education and Conduct (see Chapter 3) should be responsible for advising the Lord Chancellor on the education, qualifications and training of advocates appropriate for each of the various courts. The Lord Chancellor should be required to consult the judiciary before reaching decisions as a result of advice tendered by the Advisory Committee, although the final decision would be for him. It would seem to be appropriate that decisions by the Lord Chancellor on rights of audience should be put into effect by means of subordinate legislation which is subject to Parliamentary control. This would provide the degree of direct Parliamentary control that would be appropriate in this important area, directly affecting, as it does, the public's access to the courts.
Advocacy certificates
5.14 The Government proposes, subject to any advice it might receive from the reconstituted Advisory Committee, that rights of audience for all advocates should be dependent on a certificate of competence. This certificate could be either full, entitling the advocate to rights of audience in all courts, or limited, entitling the advocate to rights of audience in only the lower courts. (See paras 5.24 to 5.33 below for further details of these certificates.)
5.15 The Government suggests that, in order to obtain a full advocate's certificate, those who wish to practise in all courts in England and Wales should need to: (a) undertake an appropriate academic course in law; (b) undertake a vocational course which includes advocacy training; (c) undertake practical training in advocacy; (d) obtain a limited certificate; and then (e) practise with a limited certificate for a certain period.
Progression to each stage should depend on a satisfactory completion of the previous one and an assurance that work is being completed to a satisfactory standard.
5.16 The Government envisages that advocacy certificates would be issued and, where appropriate, varied, suspended or revoked by the relevant supervisory professional bodies. The Lord Chancellor would decide, on advice from the Advisory Committee, and after consulting the judiciary, which professional bodies should be authorised to grant advocacy certificates. The Advisory Committee would be expected to be satisfied, before recommending that any professional body should be so authorised, that that body had adequate arrangements in operation both to ensure a practitioner's competence and to monitor his performance as a practising advocate. The Government suggests that it is in the public interest that a variety of professional bodies should be so authorised. Requirements for obtaining an advocacy certificate
Academic course in law
This is discussed in Chapter 3 and Annex C.
Vocational course
5.17 The basic advocacy course should include both theoretical and practical instruction in how to present a case. This practical instruction should be under the supervision of practising advocates and should take the form of demonstrations and role-playing exercises. The student would not attend court except as an observer during this stage of training.
Practical training
5.18 This stage of training would need to be undertaken by all student advocates wishing to acquire a limited advocacy certificate. The purpose of the training would be to introduce students to the world of actual practice and to enable them to gain first-hand experience of seeing how advocacy is conducted by practitioners in court. Students would each be required to be attached throughout this stage of training to an experienced advocate who would be responsible for teaching the student the tools of the trade and monitoring his or her progress. Students should have to keep log books in which they would record details of their training, which would be authenticated by the experienced practitioner to whom they are attached. Practitioners willing to take students ought to be certified as qualified to do so by their professional body. The length and method of this practical training and the criteria appropriate for identifying practitioners qualified to take students are matters on which the Advisory Committee will be invited to make proposals. The Government would nevertheless welcome views now on how these suggestions could be given practical effect.
5.19 The Government envisages that the practical stage of training is unlikely to last for less than six months. The Advisory Committee would need to suggest what proportion of this period should consist of actual experience of what happens in court. This experience would be gained by watching, taking notes of evidence and general assistance to the practitioner to whom the student is attached. The student would not have rights of audience in court at this stage, although it might be appropriate to encourage him or her to appear as a lay person in tribunals or in small claims cases in the County Courts. Students should be able to show, perhaps through their log books, that they have attended court for a minimum period with the practitioner to whom they are attached or with other suitable practitioners in each of the categories of case relevant to the particular certificate they are seeking.
5.20 The Government suggests that there should be three types of limited advocacy certificate: (a) general, covering both criminal and civil work; (b) criminal only; and (c) civil only. The majority of students would probably wish to seek a general certificate, but there would be some (for example, any who had already decided they wanted to follow a career in the Crown Prosecution Service) who would wish to seek only a criminal or, as the case might be, a civil certificate.
5.21 This would mean that those students wishing to acquire a limited general advocacy certificate would need to show that they had attended both criminal and civil cases for a minimum period. Those students wishing to acquire only limited criminal advocacy certificates would need to show only that they had attended criminal cases for a minimum period and those students wishing to acquire only limited civil advocacy certificates would need to show only that they had attended civil cases for a minimum period. In view of the kind of practice that it is envisaged would be allowed to a student after he or she had acquired a limited advocacy certificate (see paras 5.24-5.26 below), the student should be able to show that his or her court experience at this stage had included significant experience in the lower courts.
5.22 After a student had gained some general experience of practice the Advisory Committee might wish to consider obliging him or her to undertake a further short taught course in advocacy at this stage in order to consolidate what he or she learned at the vocational stage and experienced during his or her practical training.
5.23 On satisfactory completion of the practical stage of training, which should be confirmed by the production of a certificate signed by the supervising advocate, the relevant professional body would issue the student with a limited advocacy certificate which would be either general, covering both criminal and civil work, or restricted to either criminal or civil work.
Advocacy with a limited certificate
5.24 Those holding a limited advocacy certificate could be granted rights of audience in the courts listed in para 5.25. The Advisory Committee would be expected to advise on this in due course. Those with a limited general certificate would have rights of audience in all the courts listed; those with a limited criminal or civil certificate would have rights of audience only in criminal or civil cases, as the case might be.
5.25 It should be for consideration whether any particular proceedings concerning children, such as care, wardship and adoption, should be excluded from the scope of a limited advocacy certificate.
5.26 Subject to this point, the courts proposed are as follows: (a) the Magistrates' Courts - all proceedings; (b) Coroners' Courts; (c) the County Courts - all proceedings; (d) the Crown Court - all proceedings except jury trials; and (e) the High Court - (i) formal and unopposed proceedings; and (ii) proceedings in chambers.
5.27 For some advocates a limited advocacy certificate may be sufficient for the needs of their practice. For such advocates a full certificate will be unnecessary.
Advocacy with a full certificate
5.28 A full certificate would allow an advocate rights of audience in all courts in England and Wales either in all cases or else in only criminal or civil cases, as the case might be.
5.29 It will be for consideration by the Advisory Committee whether a short formal taught course at the end of the limited certificate period would be a useful requirement before a full advocacy certificate could be obtained. The contents of any such course would obviously depend on the type of full certificate sought, but such a course could for instance cover jury trials and the differences in procedure between the County Court and the High Court.
Full general certificate 5.30 To obtain a full general certificate an advocate would need to have held a limited certificate for a minimum period and within a set period of time to have completed a prescribed minimum amount of actual advocacy in the Magistrates' Courts, the County Courts and the Crown Court.
Full criminal certificate 5.31 Similarly, to obtain a full criminal certificate an advocate would need to have held a limited certificate for a minimum period and within a set period of time to have completed a prescribed minimum amount of actual advocacy in the Magistrates' Courts and the Crown Court.
Full civil certificate 5.32 Again, to obtain a full civil certificate an advocate would need to have held a limited certificate for a minimum period and within a set period of time to have completed a prescribed minimum amount of actual advocacy in the County Courts.
5.33 These time limits and the minimum amount of actual advocacy will be matters for consideration by the Advisory Committee, but they should recognise that the best test of competence in advocacy is an advocate's ability to earn a living by pleading in the courts.
Amendments to legislation and practice rules 5.34 A re-organisation of rights of audience on the lines suggested above would require amendment of both statutory provisions and rules of court. The Bar and the Law Society would doubtless also wish to amend their professional practice rules.
Transitional arrangements
5.35 The principle underlying the transitional arrangements should be that individual practitioners who already have rights of audience before the various particular courts, when the new arrangements come into force, should retain those rights. The new arrangements would be intended to apply only to those who qualified after the new arrangements come into operation. In addition, therefore, transitional arrangements would need to be made to ensure that those who can demonstrate that they already have long experience in a particular field of advocacy and who are currently practising in that field, but who may not be able to fulfil any new educational requirements for rights of audience, will nevertheless be able to obtain the appropriate rights of audience. This would be particularly likely to apply to solicitors who can show that they already have sufficient experience of practising advocacy in the relevant courts.
Transitional arrangements for barristers
5.36 All barristers who had completed their pupillages, when the new arrangements were introduced, would be granted full general advocacy certificates. Students called to the Bar or completing pupillage after the introduction of the new arrangements would be required to obtain the proposed advocacy certificates.
Transitional arrangements for solicitors 5.37 All solicitors in private practice, when the new arrangements were introduced, would be granted limited general advocacy certificates. Obtaining a full certificate thereafter would depend on whether a solicitor could demonstrate that he or she had satisfied the necessary conditions. The Advisory Committee would be asked to advise as an early priority what this should entail. As with barristers, students completing articles after the new arrangements were introduced would be required to obtain the necessary advocacy certificates.
Transitional arrangements for employed lawyers
5.38 Employed lawyers would be granted limited general advocacy certificates when the new arrangements came into force. An employed lawyer would need to demonstrate that he or she had satisfied the requirements for a full general advocacy certificate, in order to obtain one of these. The Advisory Committee would be asked to advise as an early priority what this should entail. Any employed barrister who had not done pupillage should for this purpose also have to show that he or she had met the requirements of the proposed new practical training, although this could be done under the supervision of a suitably qualified lawyer employed in the same organisation. Procedures for dealing with potential conflicts of interest would, of course, need to be in place before these changes could be made, as would arrangements to ensure the independence of lawyers having the conduct of prosecutions from those involved in the investigative process.
Transitional arrangements for others
5.39 All those who already had limited rights of audience when the new arrangements were introduced (see Annex E for examples) would be entitled to retain these. The Advisory Committee would be asked to advise as an early priority on the appropriate continuing arrangements for granting advocacy certificates to practitioners of these kinds after the new arrangements come into force.
Consultation
5.40 The Government would welcome views on the proposals for rights of audience set out above. Recent cases have established that an advocate, whether barrister or solicitor, is immune from an action for negligence at the suit of his or her client in respect of his or her conduct and management of a case in court. This immunity extends to the preliminary work connected with the hearing such as the drawing of pleadings and to pre-trial work where the act in question is intimately connected with the conduct of the case in court.
The main reasons for this immunity are that the administration of justice requires barristers and solicitors to be able to carry out their duty to the court fearlessly and independently and that actions for negligence against barristers and solicitors in respect of advocacy work would make the re-trying of the original actions inevitable and so multiply litigation. The Government accepts the cogency of these arguments and considers that this immunity from actions in negligence should in the future extend to all recognised advocates. CHAPTER 7 - ATTENDANCE ON COUNSEL
7.1 At present, except in proceedings in the Magistrates' Court, counsel is virtually always attended by a solicitor or their representative. The Code of Conduct of the Bar allows a barrister to appear unattended in any case in the Crown Court provided that he or she is satisfied that the interests of the lay client and the interests of justice will not be prejudiced. The Law Society's Practice Rules are less relaxed about allowing solicitors not to accompany barristers to court.
7.2 The criticism frequently levelled at a requirement for counsel to be attended in court is that it produces unnecessary double manning and therefore increased cost to the client. It must therefore be considered whether the requirement for a solicitor to attend on counsel or, in the light of the proposals outlined in Chapter 5, to attend on any advocate, can be justified.
7.3 The Government considers that the need for an advocate to be attended in court depends on the circumstances. In some cases attendance may be superfluous, but in others it may genuinely be difficult for an advocate to handle both the advocacy and the ancillary matters without assistance. In such cases it may well be an efficient and cost-effective use of time for an advocate to be attended.
7.4 Accordingly, the Government considers that those who are paying for in-court work should be allowed to decide whether assistance in court is required. Any specific requirement, however, in professional practice rules that an advocate must be attended would appear to be unjustifiable. CHAPTER 8 - DIRECT ACCESS TO COUNSEL
8.1 Two separate, but related, issues are considered in this chapter: the question of contractual relationships between counsel and those who instruct them and the question of who can instruct counsel.
Contractual relations
8.2 It has long been established by case law that there is no contractual relationship between barristers and those who instruct them. A barrister therefore has to recover his or her fees by other means. One way of doing this is an arrangement such as the Bar has with the Law Society whose rules provide that, except in legal aid cases, a solicitor is personally liable as a matter of professional conduct for the payment of counsel's proper fees, whether or not he or she has been put in funds by the client.
8.3 The Government considers that these arrangements are anachronistic. The Government notes that the Bar has not thought it appropriate to adopt this approach to practice overseas and that the Overseas Practice Rules of the Bar (see Chapter 11 para 11.24) allow a barrister to negotiate fees directly with non-UK clients for non-UK work and to enforce payment. The Government accordingly proposes that there should be legislation to permit barristers who wish to do so to enter into contractual relations with those who instruct them in respect of UK work.
Direct access
8.4 The further question for consideration is who those instructing parties should be. At present, in accordance with the professional rules of conduct set out in the Bar's Code of Conduct, a barrister may accept instructions only from solicitors or, in some circumstances, from parliamentary agents, patent agents, trade mark agents, London notaries, licensed conveyancers, the Government legal service, the legal departments of local or public authorities and employed barristers. The Bar has announced recently that it intends to allow direct access from other professions such as accountants in early 1989 although direct access from the lay public continues to be prohibited. In addition, it is to be noted that the Overseas Practice Rules of the Bar provide that a barrister may:
(a) accept instructions from a foreign lawyer for non-UK work; (b) accept instructions from any UK lay client for non-UK litigation or arbitration; and (c) accept instructions from a non-UK lay client for non-UK work.
For many, if not most, barristers, the major part of their practice seems likely, notwithstanding the proposals elsewhere in this Green Paper, to continue to be advocacy and the preparation of cases for court. Advocacy is a skill which requires regular and frequent practice if high standards of performance are to be developed and maintained. Indeed advocates, who under the present arrangements depend for their livelihood upon the continuing approval of solicitors, who are their independent professional clients, find that it is only in this way that they can maintain a successful practice as advocates. Advocates may therefore wish to choose to accept instructions only from other professionals who have the expertise to identify the issues and sift out the relevant facts for them; and to concentrate themselves on maintaining their practice and performance as advocates. Moreover, the majority of solicitors, particularly those who practise in small firms or in areas distant from any major court centre, are likely to continue to find that it suits the nature of their business not to practise regularly as advocates themselves, but rather, as they do now with much County Court and Magistrates' Court work, to instruct those whose full-time occupation is advocacy to take their in-court work for them.
At present the Government thinks that in the future advocates should themselves have the discretion to decide, in the light of the nature of their practice, whether they wish to take instructions directly from lay clients or to restrict themselves to taking instructions only from other professionals. Moreover, in order to promote the use of their services, advocates who choose only to take instructions through other professionals, should be entitled, if they so wish, to belong to a voluntary association, one of whose characteristics might be that its members take instructions only in this way, although they would need to be able to demonstrate in due course to the competition authority that this was not operating in an anti-competitive way. They could also advertise their membership of such an association to those instructing professionals, such as solicitors, who are likely to want to continue to use their services. The prime examples of such bodies are currently the four Inns of Court, who compete with each other by means of their scholarships, libraries and other collegiate facilities to attract new entrants to the profession to their membership. Other examples might in the future develop on the lines of one or more of the specialist Bar Associations. There is, however, an argument sometimes advanced, which is set out in this paragraph, that to grant to advocates, who practise in the higher courts, the right to have direct access to the lay client might lead to fundamental changes in the structure of the legal profession, which would reduce the extent of informed choice currently available to the lay client through his solicitor; and would lower the standards of advocacy to which the courts have become accustomed. This argument is that, whereas there are currently some 50,000 solicitors who have available to them the specialist services, both in advocacy and other specialisms, of some 5,500 members of the independent Bar, the right to direct access might lead more and more advocates to attach themselves, as "trial lawyers", to firms of solicitors, or to set themselves up as advocates taking their clients direct from the public. The result, it is said, could be that there might be a serious contraction of the corps of independent advocates available to all solicitors, and an increasing practice amongst lawyers of all kinds to choose their own in-house specialist or trial lawyer in preference to the independent specialist best suited to the needs of the particular case. If this happened to any serious extent, the result, it is suggested, could be that the choice of advocates available to all clients would be substantially reduced.
The Government, however, hopes and expects that a free market for the provision of independent advocacy services will flourish. Certainly the extent and variety of the present demand for advocacy leads the Government to believe that this will be so. Empirical evidence from other common law jurisdictions and the present success of English barristers in obtaining work abroad, especially in Europe, suggest that specialist advocates who act only as such and do not become involved in pre-advocacy case work are well able to flourish in the market place in direct and open competition with other lawyers who do not act exclusively as advocates.
Consultation
8.9 The Government would welcome comment on the principles set out in this chapter; and on whether its views, and its proposals in the light of English barristers' experience in other common law jurisdictions and in Europe, meet the criteria endorsed in Chapter 1. Barristers have historically been divided into junior Counsel and Queen's (or King's) Counsel. The first King's Counsel were appointed by the Crown at the end of the sixteenth century in order to assist the law officers of the Crown. By the eighteenth century appointment had come to be regarded as a mark of pre-eminence in the profession. Today Queen's Counsel comprise about 10 per cent of the practising Bar.
Queen's Counsel ("QCs" or "Silks") are appointed by the Queen on the advice of the Lord Chancellor. Practitioners who wish to be considered for appointment are invited to submit their names to the Lord Chancellor. Following wide consultation with the judiciary and the profession, the Lord Chancellor then settles the list of names to be recommended to the Queen.
In the past the Bar had a rule that a QC could appear in Court only if a junior also were instructed. That rule has now gone. A QC may, however, decline to appear without a junior, if he considers that the interests of the client require that a junior also should be instructed. He may also decline instructions to advise or draft a non-contentious document without a junior, if he considers that the interests of the client require that a junior also should be instructed.
Critics of the system say that it is inflationary because QCs' charges are unnecessarily high, and because juniors are still unnecessarily instructed. It has therefore been suggested in some quarters that the system no longer serves any useful purpose, and that it should be abolished. Against that, the Government considers that the retention of a two-tier system of advocates is justified. Appointment to the rank of QC is made only after very wide consultation by the Lord Chancellor. It thereby:
(a) enables both lawyers and clients to identify the leading members of the profession, and thus to exercise a more informed choice about the competence of the advocates whom they are choosing than they would otherwise have been able to do;
(b) acts as an incentive for advocates to strive to achieve and maintain excellent standards; and
(c) helps the Lord Chancellor to identify at an early stage those who are likely in due course to be candidates for the High Court Bench, and for other forms of public service such as inquiries into disasters.
The Government considers, in the light of the proposals in Chapter 5 on rights of audience, that in future all who hold full general advocacy certificates, whether or not they are barristers, should be treated as eligible for appointment as Queen's Counsel. The present practice whereby Silk is occasionally given, normally on an honorary basis, to people who are not practising advocates, for example distinguished academics, also need not be disturbed, although such honorary appointments need not in future be restricted to those who happen originally to have qualified as barristers. Appointment to Silk is not controlled by statute, so no legislation would be required to achieve this. In the Government's view, however, any professional practice rules about access to or representation by Silks or about the relative size of payments to Silks and other lawyers appear to be difficult to justify. This will be a matter for the proposed new competition authority.
Summary
The Government proposes that in future those treated as eligible for Silk should be:-
(a) all those who hold full general advocacy certificates; and
(b) on an occasional and honorary basis, lawyers who are not practising advocates, whether or not such lawyers are barristers. CHAPTER 10 - THE JUDICIARY
Summary
10.1 The Government proposes that all advocates who have held the relevant advocacy certificates for the appropriate length of time should in future be eligible for judicial appointment; and in addition that judges in a lower court should be eligible for promotion to a higher one on the basis of their judicial experience in the lower court.
Basis of judicial appointments
10.2 A strong and independent judiciary is one of the central supports upon which our liberties are based and upon which the rule of law depends. Moreover, our adversarial method of administering justice requires the judges at least at trial courts to be recruited on the whole from among seasoned advocates. It is, therefore, important that the ablest practitioners should have in their sights some aspiration towards judicial work at the end of their careers in professional practice. No one should be excluded, by virtue of the fact of choosing one branch of the profession rather than another, from reaching the highest judicial office. Over time, the increased competition will enable the Lord Chancellor more easily to maintain the highest standard of appointments. The Government therefore proposes that, in future, all those who have held an advocacy certificate for an appropriate minimum period for the courts covered by any particular judicial office should be eligible for appointment to that office. As now, legal eligibility will not of course guarantee appointment. In particular, the Lord Chancellor sees no reason to change the now well-established policy of requiring satisfactory part-time judicial service as a condition of full-time judicial appointment. The Appellate Jurisdiction Act 1876 provides that the qualification for appointment as a Lord of Appeal in Ordinary is that the individual:-
(a) has for at least two years held the office of Lord Chancellor or of Judge in one of Her Majesty's Superior Courts in Great Britain and Northern Ireland; or
(b) has been for not less than 15 years a practising barrister in England and Wales or Northern Ireland or a practising advocate in Scotland.
Although the Lords of Appeal in Ordinary are usually appointed from among the judges of the superior courts, the Government proposes to amend (b) above to remove the reference to a practising barrister and to refer instead to anyone who has held a full general advocacy certificate for at least 15 years. The Scottish position will be considered separately.
Under the present legislation some senior judicial offices are not open to solicitors; others, although open to solicitors, impose upon them criteria for eligibility which do not apply in relation to barristers. Solicitors are not eligible for appointment as Lords Justices of Appeal, Heads of Division, High Court Judges or Deputy High Court Judges. Although solicitors can now be appointed as Circuit Judges, they are required, unlike barristers, to have served for a period of at least three years as Recorders before appointment. Section 9(1) of the Supreme Court Act 1981 does, however, provide that the Lord Chancellor may request a Circuit Judge to sit as a judge of the High Court, so that solicitor Circuit Judges may by this means be requested to sit as High Court Judges from time to time.
(a) Judicial promotions
10.5 At the time of the Parliamentary passage of the Supreme Court Act 1981, an attempt was made to amend the provisions of the Bill so as to provide that any Circuit Judge could be eligible for appointment to the High Court. This would have meant that solicitors could, by that route, have reached the High Court. This move was resisted at the time, substantially on the basis that it was considered that only practice as an advocate in the High Court equipped anyone to sit judicially in that forum. Because solicitors did not have a right of audience in the High Court, they could, therefore, it was argued, never acquire the relevant experience.
10.6 It is doubtful whether the arguments which were successful in 1981 still carry conviction. A successful career as an advocate in the High Court is an excellent way of training an individual to sit judicially in that court, but it does not necessarily follow that advocacy and advocacy alone in the higher courts should be the only route to a judicial career in these courts. Judicial experience seems an equally acceptable qualification; and it seems today an unjustifiable constraint that a solicitor Circuit Judge, whatever his or her merits, can never be promoted to the High Court. If the law were changed to permit the Lord Chancellor to recommend the promotion of solicitor Circuit Judges to the High Court, there would, of course, be no obligation on him to do so. He would continue, as now, to choose the best available candidate for each individual post, but the pool from which he could make that choice would be beneficially enlarged.
(b) Direct appointments
10.7 What is now recommended for the development of the profession (see Chapter 5) will in due course create a class of advocates in the superior courts who may be either barristers or solicitors or lawyers who are neither. A wider question therefore arises whether it can be right to limit eligibility to direct appointment to judicial office in these courts to one side of the profession or the other. It does not appear to be logical to do so. Rather, eligibility for appointment to the Supreme Court and Circuit Bench should be determined by reference to whether any individual practitioner has had the necessary experience as an advocate in the relevant court.
(c) The Government's proposals
10.8 (i) The Government therefore proposes that there should in future be two ways to establish eligibility for a Supreme Court appointment. The first would be by having held a full general advocacy certificate for a minimum period, probably 10 years; and the second would be by having held office as a Circuit Judge for a minimum period, perhaps 2 years. All those who had held a full general advocacy certificate for the minimum period should be eligible also to act as Deputy High Court Judges.
(ii) All those who had held a full general advocacy certificate, or at least either a full criminal and a limited civil or a full civil and a limited criminal advocacy certificate, for a minimum period, probably 10 years, should be eligible for appointment to the Circuit Bench. In addition, a Master or Registrar or equivalent judicial officer who had held office for a minimum period, perhaps 2 years, should be eligible for appointment as a Circuit Judge. The present requirement that solicitors must serve as Recorders for a minimum of 3 years before appointment to the Circuit Bench should be removed. The criteria for appointment as a Recorder or Assistant Recorder should be changed in line with those for appointment as a Circuit Judge.
(C) Masters and Registrars
10.9 Only solicitors of at least 7 years' standing are at present qualified for appointment as County Court Registrars (section 9 of the County Courts Act 1984). The Civil Justice Review recommended that barristers also should be eligible for appointment as County Court Registrars (rec 14); and there has been no subsequent objection to this proposal. In addition, since the Supreme Court Act 1981 both solicitors and barristers have been eligible for appointment as Masters and Registrars in all branches of the High Court.
10.10 The Government now proposes, in line with its general approach to the judiciary, that in future any person who has held at least a limited civil advocacy certificate for a minimum period, probably 7 years, should be eligible for appointment as a High Court Master or Registrar or as a County Court Registrar. Obviously advocates who had held full civil or full or limited general certificates for an equivalent minimum period also would be eligible for appointment. These eligibility conditions would be applied also to part-time appointments, since a number of advocates might wish to practise part-time as advocates and to sit part-time as Registrars.
(D) Other appointments
10.11 This chapter has discussed only the main judicial appointments at each level. There are also various other judicial appointments, particularly at the lower levels, where the eligibility provisions will need to be amended in line with the approach set out in this chapter.
Transitional arrangements
10.12 The following transitional arrangements seem appropriate:
(a) Barristers All barristers who had been called when the new arrangements came into force, would be eligible for all appointments for which they are at present eligible, provided they were of or achieved the standing required by the present law. In addition they would become eligible for appointment as County Court Registrars, again provided they were of or achieved the required number of years standing.
(b) Solicitors All solicitors who were on the roll when the new arrangements came into force would be eligible for all appointments provided:
(i) in the case of appointments to the House of Lords and the Supreme Court, they were of or achieved the standing now required for barristers and acquired the necessary full advocacy certificate; (ii) in the case of appointments to the Circuit Bench, they were of or achieved 10 years' standing; and
(iii) in the case of appointments as Masters and Registrars, they were of or achieved 7 years' standing.
Conclusion
10.13 In conclusion, therefore, it is proposed that:
(a) any person who has held a full general advocacy certificate for at least 15 years should be eligible for appointment as a Lord of Appeal in Ordinary (the existing provision for the appointment of serving judges would remain);
(b) any person who has held a full general advocacy certificate for at least 10 years or has been a Circuit Judge for at least 2 years should be eligible for appointment to the Supreme Court;
(c) any person who has held a full general advocacy certificate for at least 10 years should be eligible to act as a Deputy High Court judge;
(d) any person who has held a full general advocacy certificate, or at least either a full criminal and a limited civil or a full civil and a limited criminal advocacy certificate, for at least 10 years should be eligible for appointment to the Circuit Bench;
(e) any person who has been a Master or Registrar or an equivalent judicial officer for at least 2 years should be eligible for appointment to the Circuit Bench;
(f) the provision whereby a solicitor must serve for a minimum of 3 years as a Recorder before becoming eligible for appointment to the Circuit Bench should be removed;
(g) the criteria for appointment as a Recorder or Assistant Recorder should be changed in line with those for a Circuit Judge; and
(h) any person who has held at least a limited civil advocacy certificate for at least 7 years should be eligible for appointment as a High Court Master or Registrar or as a County Court Registrar. CHAPTER 11 - BARRISTERS' PRACTICES
Introduction
11.1 The internal rules and methods of organisation which govern barristers' practices are a matter for the Bar, although it will need to be able to justify these to the new competition authority which it is envisaged will be set up in accordance with the Government's proposals set out in the consultation paper "Review of Restrictive Trade Practices" which was published by the Department of Trade and Industry in March 1988. The purpose of this chapter is to examine existing arrangements for barristers' practices in the context of the criteria of quality of service, efficiency, and competition set out in Chapter 1 of this paper, and against the background of the need to protect the interests of clients. As a starting point for that examination, this chapter sets out a number of areas in which the existing arrangements for barristers' practices might benefit from closer scrutiny.
Main areas of concern
11.2 Every barrister who wishes to set up in practice must first go through a period of pupillage. He must then:-
(a) become a member of chambers i.e. obtain a tenancy; (b) practise only as an individual; and (c) have the services of a clerk.
11.3 These special requirements of the Bar have been criticised on the grounds, first, that it is often very difficult for new barristers to get themselves into a position where they may set up in practice, and, secondly, that the practice requirements are themselves unnecessarily restrictive.
Pupillages 11.4 The Bar has a policy that anyone who wishes to enter pupillage should be allowed to do so. The present system of pupillage allocations, however, has been criticised as unsatisfactory, on the grounds that it operates haphazardly and unfairly, particularly to the disadvantage of minority groups. Although some chambers already advertise for pupils, the Bar, in response to these criticisms, is at present considering the establishment of a central information base from which prospective pupils and tenants may find out easily what and where vacancies exist. It is also considering a register of approved pupil masters and a wider range of pupillages, which take more account of the needs of central and local Government, commerce and the EC.
11.5 The Government expects the Bar to ensure that pupillages are allocated in the most efficient and fair way possible.
Tenancies
11.6 Even greater difficulties can be experienced by those who wish to set up in practice, since this entails obtaining a tenancy in chambers. Although no reliable figures are available, it seems that only between 50% and 65% of those completing pupillage obtain a tenancy. Even though not every new barrister wishes to set up in independent practice, this still gives cause for concern. Moreover it cannot be assumed that those who do at present obtain tenancies are on the whole the best barristers, since it still appears to be difficult for a barrister to obtain a tenancy in a set where he has not obtained pupillage. The successful pupil in one set may not be as good as an unsuccessful pupil in another set. 11.7 The Government expects the Bar to introduce a more competitive system, covering all chambers, which will result in tenancies being granted on a more open and fair basis in all cases.
Chambers
11.8 The underlying cause of difficulty arises from the present rule that a barrister must practise from approved chambers, coupled with the shortage of accommodation in the Inns of Court, which is where the overwhelming majority of barristers in London choose to practise. It is absurd that entry to a profession depends on whether a person can obtain accommodation.
11.9 There is in fact no requirement that a barrister should practise from any particular place, but a barrister who wishes to open chambers in central London, otherwise than in premises owned or managed by the Inns, must apply to the Bar Council for consent. A barrister who wishes to open a set of chambers on Circuit must apply to the Circuit for permission. The criteria used by the Bar when it considers applications include the suitability of the applicant, of the clerk and of the premises and their location. It is, however, expressly provided that lack of need cannot be a valid ground for refusal, presumably so that leave cannot be refused because of a fear of possible competition.
11.10 The Government believes that the present requirements that a barrister must practise from approved chambers and that consent must be obtained from the Bar before chambers are opened outside the Inns are unnecessarily restrictive and not needed to protect either the barrister or the client. There is no obvious reason why barristers ought not to be allowed to practise where they choose. 11.11 The Government accepts that most barristers may continue to prefer to set up in chambers. As a consequence, any improvement to the present accommodation problem will largely depend on members of the Bar in London being more ready to set up chambers outside the Inns. Although there was once a financial advantage in having chambers in the Inns, because rents were lower than rents outside, this is less so now because the Inns are increasingly charging market rents. Some sets do, however, appear to prefer to remain in cramped accommodation for reasons other than the costs of accommodation outside. Proximity to other barristers, to the Inns' facilities and to the Courts are cited as factors. There are also those who are anxious that solicitors will not instruct them if they are in practice outside the Inns, because lay clients will not regard them as sufficiently prestigious.
11.12 There are already sets of chambers which have set up and survived outside the Inns. Indeed it is probably not necessary to go far away to find suitable accommodation. In any case, the traditional wish to be near the Royal Courts of Justice, because of the convenience of easy physical access, will be of less significance with the continuing development of information technology. The Government is also aware that the Inns themselves are now beginning to tackle the problem. In June 1987 the Inns Council resolved that the Inns should as far as possible, and in cooperation with one another, provide sufficient accommodation whether within or if necessary outside the precincts of the Inns of Court to house the practising Bar in London. In May 1988 the Vice-Chairman of the Inns Accommodation Committee invited those Chambers prepared to move out to let him know. The Government welcomes this approach but suggests that it should be made in a more positive manner. The Government considers that the profession should take active steps to find suitable accommodation for barristers outside the Inns.
Partnerships
11.13 Barristers are not permitted to practise in partnership. A set of chambers therefore consists of a number of sole practitioners practising within the same premises. The Head of Chambers is required to ensure that the chambers function properly. In recent years there has been an increasing tendency for sets to establish committees of barristers responsible for matters such as pupillage, recruitment and management. There are now also often chambers meetings of all members. In addition the Bar now permits fee-sharing agreements. It may be wondered why the Bar does not simply permit partnerships.
11.14 This is a question which has often been considered by the Bar over the years. The principal argument by those against appears to be that it would severely restrict client freedom of choice because one partner may not act for a client if his partner acts for an opposing client. This is a consequence of section 5 of the Partnership Act 1890, which makes one partner responsible for the acts and defaults of the other partner. If partners acted for opposing sides in a case they would therefore be subject to a conflict of interest. It would also be wrong for partners to have a financial interest in both sides of a case. The same considerations prevent different members of the same firm of solicitors from acting for opposite sides in a case. The Government would welcome comment on whether these problems are insurmountable; or whether there might be ways to meet the point about conflict of interest, which would enable partners to act for opposing sides in a case.
11.15 The Government believes that it ought to be for individual groups of barristers to decide what is best for themselves, although it thinks that, particularly in areas of specialised practice where there are only very few sets which can offer the necessary expertise, barristers are very likely to decide for themselves that partnership is not a practical proposition. In other areas it may be.
11.16 Partnership could offer barristers some advantages over their present system. In particular it could:-
(a) permit increased financial stability for a set of chambers;
(b) improve the financial position of the new entrant;
(c) encourage proper supervision of work undertaken by the new entrant; and
(d) ensure greater office efficiency.
11.17 The Government thinks that barristers should be permitted to operate in partnerships if they choose to do so, although it recognises that for many this may not be a preferred option. The Government believes that the risk of diminishing clients' choice, whether in specialist fields of law or in the smaller circuits outside London, is outweighed by the advantages of greater efficiency and of easing the entry of new barristers into the profession. Any risk of diminution of clients' choice will be met by the fact that the forces of competition can be expected to fill naturally any gaps in the provision of advocacy services.
Incorporation
11.18 Since some chambers have already formed companies for the ownership of common assets, the Government thinks barristers should probably also be permitted to operate in corporate form if they so choose, although this should not affect the personal responsibility of individual practitioners for their client's cases. Safeguards would be needed to ensure that clients remained adequately financially protected, if barristers wanted to form limited liability companies.
Employment of others
11.19 There also seems to be no reason why barristers should not be able to employ others to assist them with their legal work, including other barristers (subject to rules about conflicts of interest).
Clerks
11.20 The functions of a barrister's clerk have been described as:-
(a) office administrator and accountant;
(b) business manager; and
(c) agent.
11.21 His role in a barrister's life is a powerful one because of the rule that every barrister must have a clerk and because of a further rule that the solicitor must normally negotiate with the clerk rather than the barrister about fees. In addition the organisation of members of chambers as a collection of individuals rather than a partnership may impede their collective control over their clerk.
11.22 Clerks have been criticised as having too much influence over the careers of members of chambers and as earning too much because traditionally they have been paid entirely by commission out of the barristers' fees. These features may today already be diminishing. As indicated above, chambers management is increasingly coming under the control of committees; and clerks are tending more and more to receive salaries plus either incentives to reward results or smaller commissions.
11.23 Of more significance are the professional rules that every barrister must have a clerk and that he should normally negotiate the barrister's fees. Barristers will naturally need to have office staff to organise their practices, but this should be a matter for them alone to settle. Accordingly the Government agrees with both Benson and Marre that barristers should not be compelled to have a clerk. Rather they should be able to negotiate their own fees, if they so wish. Moreover, they should simply be under a professional duty to ensure that their own particular practices are managed in an efficient and effective manner.
11.24 It should be for individual barristers or chambers to decide what system of managing their practices is most suitable for them. It will be of increasing importance for barristers to be able - as Marre pointed out - to tailor the organisation of their practices to meet the demands of the commercial and international sectors. In particular, the Bar needs to make use of modern business methods and information technology. The recent report by BDI Binder Hamlyn on chambers administration, for example, concluded that staff structures and management techniques in barristers' chambers were inadequate; and the Government hopes that the Bar will encourage its members to implement the recommendations in that report.
Other restrictions
11.25 This chapter has sought only to indicate those areas of barristers' practices which give particular concern. The Government hopes that the Bar will examine all their rules carefully to ensure that they do not impose unnecessary or unhelpful restrictions. For example it should also be considered whether:-
(a) the rule that every barrister (other than one whose chambers are in London) should be a member of a Circuit or a specialist association serves any particular purpose; and
(b) the rule that conferences should normally be held in chambers or in some place other than a professional client's office tends to increase expense rather than protect the integrity of the barrister.
Overseas practice
11.26 In striking contrast to the rules on practice in England and Wales, the Bar's rules on overseas practice for barristers are much less restrictive. For example, barristers:-
(a) can accept instructions direct from any UK lay client for non-U.K. litigation or arbitration, or from non-U.K. lay clients for non-U.K. work; (b) can negotiate fees directly with these clients and enforce payment;
(c) can employ outside the U.K. any person who is not a solicitor practising in England and Wales;
(d) can practise without a clerk; and
(e) can enter a partnership with any other lawyers except practising U.K. solicitors.
11.27 No doubt this more relaxed approach was prompted by commercial necessity, but presumably the Bar would not have made these rules if it thought the professional integrity of barristers would suffer as a consequence. It is difficult to see why the position would be different if the same approach were followed in England and Wales.
Summary
11.28 The Government considers that the Bar needs to make changes on the lines mentioned above in order to ensure that barristers' practising arrangements do not hinder the provision of legal services to the public in the most effective, efficient and economical ways. The areas requiring particular consideration are:-
(a) obtaining pupillages; (b) obtaining tenancies; (c) the requirement to practise as a member of chambers; (d) the restrictions on partnerships; (e) the possibility of allowing incorporation; and (f) the functions of barristers' clerks. CHAPTER 12 - MULTI-DISCIPLINARY AND MULTI-NATIONAL PRACTICES
(A) Multi-disciplinary practices
Present Position
(a) General
12.1 At present solicitors and barristers are both prevented by practice rule or code of conduct from practising in conjunction with members of any other profession. The Law Society Practice Rules prohibit a solicitor from sharing fees with an unqualified person (i.e. anyone not a solicitor). As far as contentious business is concerned, this prohibition has statutory backing from the combined effect of section 39 of the Solicitors Act 1974 and section 5 of the Partnership Act 1890. It is also arguable that section 22 of the Solicitors Act has a similar effect in respect of conveyancing services. Barristers are particularly constrained in that they are required by the Bar's Code of Conduct to practise only as individuals, which thus prevents them, unlike solicitors, even from practising in partnership with each other.
(b) Solicitors
12.2 The traditional limitation to sole practice, or partnership only with other solicitors, of the way in which solicitors may organise their business reflects the profession's concern to maintain the independence and the role of the solicitor as an officer of the court, and to avoid conflicts of interest. It has been argued that such limitation is necessary to preserve:
(a) the personal and fiduciary relationship between solicitor and client;
(b) the safeguards afforded to clients by the high standards of ethics and expertise of the profession, supported by its requirements in respect of professional indemnity insurance, compensation and accounting for clients' money, and its provisions for handling complaints and maintaining professional discipline;
(c) legal privilege of communications between solicitor and client; and
(d) the proper carrying out of functions reserved by statute to solicitors.
Supporters of this view are apprehensive that the maintenance of solicitors' independence and high standards of conduct might come into conflict with their duties to colleagues in a multi-disciplinary practice, since those colleagues would be subject to the different codes of conduct of their own professions. Some solicitors have also expressed concern that multi-disciplinary practices might unfairly attract business away from solicitors' practices, and that this, particularly if it led to the development of large mixed practices, would so decrease the number of solicitors in private practice as to reduce significantly the public's freedom to choose between a wide variety of sources of legal services.
Arguments for change
12.3 Against that, it has been argued that the prohibition of multi-disciplinary practices is a significant restriction on the freedom of solicitors to conduct their business, which may be expected to result in higher costs to clients, less efficient use of resources, discouragement of new developments, and a tendency towards rigidity in the structure and methods of solicitors' businesses. Proponents of this view see advantages to both solicitors and the public if multi-disciplinary practices were allowed. They consider that this would enable solicitors to:-
(a) compete more effectively with other professions and businesses which can and do include legal advice among the services they offer;
(b) meet more comprehensively the demand for overlapping services from, for example, house buyers and commercial clients; and
(c) adapt to the changing conditions of demand for professional services, without either having to employ artificial devices to avoid breaching practice restrictions or being unable to reward with partnership status senior employees from other professional disciplines, including foreign lawyers.
Many other professions, such as accountants, surveyors, engineers and architects, permit multi-disciplinary practices and their professional bodies have evolved rules governing their operation. No significant problems have been reported in relation to these practices.
The public, they believe, would benefit from the greater flexibility which solicitors would enjoy through efficiency gains, improved channels of communication between the professions, and an increased choice of legal services between independent solicitors and practices providing a range of services. They argue that the risks of multi-disciplinary practices have been overstated in that:- (a) the choice between small practices offering a close personal relationship between solicitor and client and larger practices where there is a greater degree of delegation already exists; multi-disciplinary practices would do little to narrow that choice (particularly if, as expected, only a minority of solicitors would opt for mixed practice);
(b) some solicitors' firms are already organised to provide a range of services by employing specialists in other disciplines without any diminution in standards of conduct; and
(c) safeguards can be devised which would provide protection to clients of multi-disciplinary practices similar to that afforded to clients of solicitors' practices.
History 12.5 The question whether solicitors should be free to engage in practice with other professions was discussed by the Royal Commission on Legal Services (the Benson Commission) in 1979 and the Royal Commission on Legal Services in Scotland (the Hughes Commission) in 1980. Both Commissions considered the restriction in the light of its capacity to protect the interests of the public and enhance the level of legal services available to the public. The Benson Commission decided that the balance lay in favour of maintaining the restriction. They acknowledged the potential convenience of joint provision of overlapping or closely connected professional services; but they concluded that demand was limited, cost savings were questionable, client choice might be limited, and that practical difficulties would stand in the way of producing a common code of conduct for mixed partnerships. The Hughes Commission took the opposite view. They thought the risk of diminishing clients' choice of professional adviser would be small and would be outweighed by the prospect of cross-fertilisation of advice and greater access for clients to different professional groups; and they thought the problems of which professional bodies' rules should apply to mixed partnerships could be resolved by discussion between professional bodies. Although they found little demand at that time for development of multi-disciplinary partnerships, they could see no good reason for preventing their development at all; and they recommended removal of the statutory ban on Scottish solicitors sharing fees with others.
Recent developments
12.6 In 1986, the Director General of Fair Trading reported on a review, which he had undertaken at the request of Ministers, of restrictions on the kind of organisation through which members of the professions might offer their services. The Director General noted the course of debate about multi-disciplinary practices involving solicitors since the reports of the two Royal Commissions. He supported the view that such mixed practices should be encouraged, with suitable safeguards for the maintenance of professional standards and adequate consumer protection. He therefore recommended that Ministers should consider amendment of the Solicitors Acts to remove statutory prohibitions on solicitors sharing fees with non-solicitors, and of any other statutory provisions which might prevent solicitors from entering into partnership or any other form of association with members of other professions. He pointed out that legislation to this effect would be a necessary precursor to corresponding alteration of the practice rules of the Law Societies.
12.7 In November 1987 the Scottish Home and Health Department issued a discussion paper on the Practice of the Solicitor's Profession in Scotland, which stated that it seemed to the Secretary of State that the weight of argument was clearly in favour of permitting mixed practices of solicitors and other professions. The paper invited observations in the light of which the Secretary of State would further consider his initial view that sections 26 and 27 of the Solicitors (Scotland) Act 1980 should be amended so as to permit the Law Society of Scotland to allow mixed professional practices. The Secretary of State is at present considering the responses to the discussion paper.
The Government's view
12.8 The Government considers that the range of choice available to users of legal services in England and Wales should not be limited unless there are strong public interest reasons to the contrary, and that restrictions on competition between solicitors should be no greater than is necessary adequately to safeguard the interests of their clients. In the light of this and the Director General's recommendation, the Government proposes to amend the Solicitors Act 1974 to remove any statutory inhibition on the freedom of solicitors in England and Wales to engage in multi-disciplinary and multi-national practices. The Government expects the Law Society to amend its Practice Rules in the same way. Once the statutory restrictions have been removed, the Law Society (or any other professional body) would, of course, have to satisfy the competition authority that any remaining restrictions they imposed were not unnecessarily anti-competitive.
**Safeguards**
12.9 The question therefore arises of how to maintain high professional standards so as properly to safeguard the interests of clients who seek legal services from multi-disciplinary practices. This is primarily a matter for the Law Society to consider in addressing what changes would be required to its Practice Rules and guidance on solicitors' conduct. The rules of the Council of Licensed Conveyancers already permit licensed conveyancers to practise in partnership with other professions, subject to the Council's decision as to the suitability of the other professions concerned. These rules might provide the Law Society with a model on which to work. There appears to be no reason why mixed practices should be possible only in the partnership form; a corporate structure (which solicitors in England and Wales will shortly be enabled to employ, as Scottish solicitors now can), even one where solicitors did not control the ownership of the company, could equally provide the vehicle.
12.10 The essential need is to provide the same level of safeguards as presently exist in respect of solicitors' practices. One approach would be through discussions between the Law Society and other professional bodies with a view either to agreeing a common code of practice or to harmonising relevant aspects of different professions' codes of practice. The Government notes the steps that the Law Society has recently taken to arrange discussions and hopes that these will come to a speedy and successful conclusion. In either event, the Government considers that other professional bodies should, if necessary, add to the requirements imposed upon their members to bring them up to the standards of client protection of the Law Society - at least for those who opt to practise jointly with solicitors - on the principle of aiming for the highest common factor.
12.11 Ultimately, however, the maintenance of standards and safeguards in any profession depends on each of its members taking personal responsibility for observing its rules and codes of conduct, and on his or her professional body having effective disciplinary procedures to enforce observance where necessary. The Government therefore considers it essential that each member of a multi-disciplinary practice should remain individually subject to the rules of his or her professional body. The central principle must be that each member should remain personally responsible for the activities of the practice within their own professional field and should personally control the work involved, particularly in respect of functions reserved by statute to any particular profession. It will therefore be essential for a solicitor's personal responsibility to his or her profession as a lawyer to override, in any case of conflict of interest or rule, his or her responsibility to the practice as a whole and to fellow-members of it. If necessary, the Government is prepared to legislate to ensure the primacy of that personal responsibility. Subject to these considerations, the Government does not envisage statutory prescription of those with whom solicitors might be allowed to practise jointly. To do so would, in the Government's view, be to impose an unnecessary rigidity on solicitors' freedom to adapt to changing circumstances. Both the Benson Commission and the Hughes Commission concluded that there should be no relaxation of the prohibition on barristers and advocates respectively forming any kind of partnership practice. They regarded sole practice as crucial to the individualism and detachment of efficient advocacy, and were concerned that partnership practice - whether between barristers or between barristers and solicitors - would reduce the choice available to clients. They did not therefore contemplate the possibility of partnerships between barristers and members of other professions.
The Government's view
The Government thinks that barristers should now be permitted to operate in partnerships, should they choose to do so, for the reasons set out in Chapter 11 of this Green Paper at paras 11.13 to 11.17.
This raises the possibility of barristers being allowed to enter into multi-disciplinary practices. In view of the proposals in this Green Paper as to legal education (Chapter 3), advocacy (Chapter 5), direct access to counsel (Chapter 8) and judicial appointments (Chapter 10) there appears to be no good reason to distinguish in the future between barristers and solicitors in this respect. The advantages in terms both of improving the provision of legal services and of the need to maintain safeguards to the public are in principle similar in both cases. On safeguards, the crucial requirement must be that no obligation a barrister undertakes to partners or to anyone else should take precedence over his professional duty as a barrister to the courts, to his client and to the members of his profession. Subject to that, and any necessary legislative provision to ensure that a barrister's wider obligations would remain paramount over his obligations to fellow-members of a multi-disciplinary practice, the Government considers that the code of conduct of the Bar should be amended to allow barristers to choose the form of organisation through which they practise.
(B) Multi-national practices
Present Position
12.15 At present the same restrictions which prevent solicitors in England and Wales joining a multi-disciplinary practice also prevent them from practising in conjunction with lawyers from another jurisdiction. A solicitor who forms a partnership with a foreign lawyer may not, as a partner of the foreign firm, perform any of the functions reserved by statute to qualified persons. A solicitor may, however, perform such functions, if he establishes his own firm, while at the same time being a partner of the foreign firm. The restrictions on barristers practising except independently apply also in this area.
Arguments against change
12.16 There are three main arguments against change:-
(a) there are difficult questions about the regulation of firms whose partners are subject to different professional bodies. Fears have been expressed that the standards of the profession could be compromised;
(b) foreign firms might dominate or even take over domestic firms in some areas and this could be contrary to the public interest; and
(c) the present arrangements permit a wide range of forms of association short of partnership. English solicitors have taken full advantage of these. Full partnership is not therefore necessary, particularly in the light of the difficult regulatory problems.
Arguments for change
12.17 The following points are made in favour of change:-
(a) the demand for multi-national legal practices is growing as commercial operations become more international. This will undoubtedly be given a further fillip by the completion of the single market in Europe. English solicitors should be in a position to meet the market demand, unless any restrictions can be justified on public interest grounds. If the restrictions are not lifted, there is a risk that English solicitors will lose out to foreign lawyers who are permitted to be more flexible;
(b) some other countries (e.g. the Netherlands) and other UK professions (e.g. accountants) permit multi-national practices. English solicitors are permitted also to be partners in foreign practices subject to certain rules. This suggests that the regulatory concern is one that can, in principle, be met;
(c) the UK's general inward investment policies do not support excluding foreign firms for fear of dominance or take over in a particular sector. Normal competition policy prevents anticompetitive mergers or monopolies. The Government endorses this argument for change as long as professional standards are maintained; and (d) the EC directive on the mutual recognition of professional qualifications (which comes into force in early 1991) will assist lawyers from other member states in gaining access to the legal professions in England and Wales. Continuing restrictions on English lawyers' rights to form partnerships with colleagues from other member states would be anomalous in the context of such a move toward a freer Community-wide market in professional services.
Safeguards
12.18 As with multi-disciplinary practices, the Government is not persuaded that the public interest justifies the maintenance of restrictions on multi-national practices. Removal of the statutory restrictions would permit multi-national practices in principle. The issue would then be whether adequate safeguards can be established over multi-national practices to maintain professional standards and client protection.
12.19 The Government's view is that, as far as possible, safeguards should be a matter for professional self-regulation rather than Government control. Once the statutory restrictions had been lifted, the professions would, however, have to justify any remaining restrictions on the way that legal partnerships are operated to the competition authority.
12.20 There is a range of options on the operation of safeguards which are not necessarily mutually exclusive. The professional bodies would presumably want their members to remain subject to their own rules. They could require registration of a multi-national practice. All partners in a multi-national practice could then be subject to certain specific rules, although this approach might mean that foreign lawyers were effectively being required to be English solicitors rather than bringing their own expertise to the practice. An alternative option would be for the professional body to allow multi-national partnerships with lawyers who are bound by the rules of professional bodies of similar standing.
12.21 Once the statutory restrictions are lifted and the EC directive on mutual recognition of professional qualifications is implemented, the Government considers that the prevention of partnerships with EC lawyers would be increasingly anomalous. The Government also believes that it should be possible to extend multi-national practices to lawyers from other jurisdictions.
The Government's view
12.22 In summary, the Government considers that the legal professions should be as free as possible, consistent with the safeguarding of clients' interests, to offer their services in the ways that they find best meet the demands of clients. The same amendments to the Solicitors Act 1974 which will remove the statutory inhibitions on multi-disciplinary practices will serve to open the way for multi-national practices. The Government hopes therefore that the professional bodies will urgently review their own rules governing the establishment of these. 13.1 Clients need adequate information in order to make a sensible choice of a lawyer and to get maximum value for money through the lawyer and client relationship.
Background
13.2 The legal profession, like many other professions, has traditionally placed restrictions through practice rules or codes of conduct on the freedom of its members individually to inform the public about what services they offer and at what price. These restrictions in part reflected a feeling that practices such as advertising and price competition, which are common and unobjectionable in a commercial context, were undignified in a professional context and incompatible with the status and image of the profession. It was argued that individual advertising - as opposed to information about itself and its services disseminated by the profession collectively - would damage the relationship of trust between lawyer and client, and that it could be misleading to members of the public who consult a lawyer only occasionally and who are in any case not well placed to judge the quality of service offered.
The Government's approach
13.3 The Government considers that no further restraint is necessary on the way in which information is given about the legal profession beyond the principles of the British Code of Advertising Practice of the Advertising Standards Authority, which are that advertising should be legal, decent, honest and truthful. In the opinion of the Government these are strong safeguards. There should be no barriers to the publication of relevant information about the practices of the profession and the services it offers. This would help greatly to ensure that:-
(a) individual members of the public are enabled to make an informed choice of the legal adviser most suited to their needs;
(b) it becomes easier for newly qualified lawyers to enter into and establish practice;
(c) there is an incentive for established lawyers to improve their efficiency and the quality of the services they offer; and
(d) there is an encouragement to lower charges.
The overall benefit to both lawyers and their clients will, in the Government's view, improve the access of the public to justice.
Present position
13.4 Restrictions on the freedom to advertise of members of both branches of the profession were examined in reports of the Monopolies and Mergers Commission which were published in 1976. The Commission came to different conclusions in the conditions prevailing at that time. Consequently the present position on providing information differs as between solicitors and barristers.
(a) Solicitors
13.5 The Monopolies and Mergers Commission concluded that the restrictions on solicitors which then existed operated against the public interest. They recommended that Rule 1 of the Solicitors' Practice Rules, which placed a general prohibition on advertising and soliciting business, should be terminated, and that it should be replaced by a rule which would permit any solicitor to use, whenever he thought fit, such methods of publicity as he thought fit provided that they did not:
(a) claim for his practice superiority over any or all other solicitors' practices;
(b) contain any inaccuracies or misleading statements; or
(c) possess a character that could reasonably be regarded as likely to bring the profession into disrepute.
As a result of changes made to Practice Rule 1 and guidance issued by the Law Society in 1984, 1987 and 1988, solicitors are now free to advertise their services through any medium; and they may specify the fees they charge for particular services or the fact that they are prepared to give a quotation. The Law Society has also taken a number of steps to publicise the availability of solicitors' services generally.
(b) Barristers
13.6 As to barristers, the Monopolies and Mergers Commission concluded that the absolute ban in the Bar Council rules on advertising, touting and publicity did not operate against the public interest. The Commission distinguished barristers' services from those of other professions in that the lay client could (and still can) approach a barrister only through a solicitor. They took the view that the client was - almost uniquely - not disadvantaged by lack of information since he could rely on the advice of his solicitor as to which barrister to instruct. The Commission thought that the Bar Council rules concerned did not prevent solicitors from obtaining sufficient information adequately to advise clients. Moreover they thought the rules did not place any significant obstacles in the way of established barristers improving their efficiency and standard of service, or in the way of new barristers establishing themselves, given that barristers were required to practise singly (partnership being then, as now, prohibited) as a member of chambers. Consequently, the Commission did not recommend any change to the Bar Council rules.
13.7 In 1988 the Bar Council simplified its rules and issued a code of advertising and publicity, which permits the issue of a certain amount of information in approved directories and local newspapers and in approved chambers' leaflets. The position is, however, still substantially similar to that examined by the Monopolies and Mergers Commission and remains very restrictive in relation to individual barristers, especially in regard to giving information direct to the public.
The Government's view (a) Solicitors
13.8 The present Practice Rules and guidance of the Law Society on advertising by individual solicitors, combined with the action taken by the Law Society to issue information about solicitors' services generally, go a long way towards realising the advantages of publicity set out in para 13.3 above. Further consideration will, however, be needed about how best to bring to public attention the specialist skills and qualifications envisaged in Chapter 3. Although there is obvious advantage in making such specialisms widely known, it would be counter-productive if any amendment to the Practice Rules and guidance were to prevent solicitors from advertising the availability of services in particular areas in which they are experienced, but do not have a specialist qualification.
(b) Barristers
13.9 In view of the proposals about advocacy (Chapter 5) and direct access by lay clients to barristers (Chapter 8), the factors which led the Monopolies and Mergers Commission not to recommend any change in the Bar rules on publicity appear no longer to be relevant. It is therefore envisaged that the Bar Council's rules and code will need amendment to put them on the same lines as those the Law Society now has.
The Civil Justice Review's recommendation
13.10 Some alteration of existing professional practices will be needed in any event, in order to implement one important recommendation in the report of the Civil Justice Review. In its chapter on access to justice, that report recognised that fear of costs is a major factor which inhibits use of the Courts; and it recommended that solicitors and barristers should be encouraged and expected to provide information by way of stated rates per case per hour. The Government endorses this finding and strongly supports the recommendation. For solicitors it may be necessary for the Law Society to consider how its existing rules and guidance might be strengthened in order to produce more specific details. The Code of Conduct of the Bar effectively prohibits barristers from publishing their charges. Accordingly the Government believes that the code should both be relaxed to permit this and also expanded so as to encourage the routine provision of information about fees in individual cases. CHAPTER 14 - PROBATE
Introduction
14.1 In this chapter the Government sets out why it proposes to amend section 23 of the Solicitors Act 1974 which imposes restrictions on those who may draw or prepare for reward certain papers in connection with non-contentious applications for probate and letters of administration. It seeks views on whether the restrictions should be removed altogether or whether applications for reward should be made only by specific classes of persons.
Existing restrictions
14.2 Under section 23 of the Solicitors Act 1974 it is an offence for anyone apart from a solicitor, barrister or notary to draw or prepare for reward the papers on which to found a grant of probate or letters of administration.
14.3 The papers required are:-
(a) an affidavit by which the applicant for the grant swears that he will administer the estate according to the law and
(i) if he is an executor, swears that he is the executor named and identifies the will as the last will of the deceased; or
(ii) if there is no executor or no will, identifies his title to the grant;
(b) very occasionally, affidavits in respect of certain other matters; and Applications for a grant may be made in person or by a solicitor. The Non-Contentious Probate Rules provide that only applications by a solicitor do not require personal attendance at the Probate Registry.
Difficulties created
It is common practice for a testator to nominate a bank as his executor. A bank for this purpose operates as a trust corporation. The expression "trust corporation" is defined by section 128 of the Supreme Court Act 1981 and the Law of Property (Amendment) Act 1926 as meaning the Public Trustee, a corporation appointed by the Court in any particular case to be a trustee, or a corporation entitled under the Public Trustee Rules to act as custodian trustee. The list of corporations entitled to act is large and varied. It includes the Treasury Solicitor, charities authorised by the Lord Chancellor, local authorities, and organizations like British Gas, London Regional Transport and the British Coal Corporation in relation to their pension funds. It also includes UK or EEC companies which are empowered to undertake trust business, have at least one place of business in England and Wales and have issued capital of £250,000 of which not less than £100,000 has been paid up in cash. Examples of such companies are insurance companies and, as stated at the beginning of the paragraph, banks.
A trust corporation is, like any other executor, entitled to administer the estate in respect of which it has been appointed. However, as it receives a fee for being executor, it cannot prepare the affidavit or account. Nor can it make a personal application for probate as it is specifically excluded from doing this by the Non-Contentious Probate Rules. It must therefore instruct a solicitor to prepare the papers and make the application on its behalf.
14.7 It might appear that it could avoid these difficulties by making the application through an in-house solicitor. However there is some doubt as to whether this would be lawful. It is argued that the restrictions on unqualified persons (i.e. those who are not solicitors) cannot be avoided by an unqualified person employing a solicitor to act as his agent. If this interpretation of section 23 is correct, the result is illogical, bearing in mind that employed solicitors are able to litigate on behalf of their employers and will soon be able to provide conveyancing services on their behalf. Nevertheless, the wording of section 23 can be seen as a bar on making applications for grants through employed solicitors.
14.8 Banks have been arguing for some time that section 23 should be amended so that they are clearly permitted to make applications for grants. In addition licensed conveyancers now argue that they need to be able to make applications on behalf of clients. An obvious example is where their clients need to obtain a grant of probate to obtain a good title. At the moment, unless clients are willing to make personal applications, licensed conveyancers have to send them to solicitors.
Justification for restrictions
14.9 The justification for the restrictions in section 23 would appear to be:- (a) the need to protect the estate. The protection that the section might give could be only very limited. It does not apply to cases where the executor or his agent acts without reward. It does not protect the estate once it is in the hands of the executors which is the stage at which most dishonesty would take place. It bites only on the formal application for the grant.
(b) the need to protect the courts from poorly prepared documents. In cases where trust corporations administer estates, it is thought that they prepare the documentation so the role of the solicitor is purely nominal. In the view of the Probate Registry, documents prepared by trust corporations are at least as well prepared as those prepared by solicitors. The Probate Registry checks all applications and will not issue a grant unless it is satisfied that all is in order.
14.10 The Law Society were until recently firmly against any change. The President, however, in his recent address to the Law Society Conference, said:-
"We are reassessing the areas of work in which we retain privileged positions. For example, the Council is looking again at whether the monopoly we enjoy by statute for taking out probate and letters of administration, is really justified in the public interest. I will tell you my view. Non-contentious probate is an area of work which as a profession we have traditionally dominated. Where banks or other trust corporations have been instructed as executors to undertake the bulk of the winding up of an estate is there really a public safeguard in requiring only the probate papers themselves to be drawn and lodged by a solicitor? We know that our charges for executorship are modest compared with those the bank charge, and we should be publicising this fact to our clients. If we cannot stand on our reputation in this area and maintain a substantial share of the market, we do not deserve to have it artificially maintained for us by protective legislation."
The Government welcomes this constructive approach.
Relaxation
14.11 The Government has concluded that it can no longer justify maintaining the present statutory restriction on those who may make applications for grants of probate or letters of administration for reward in non-contentious cases. However it wishes to seek views on whether the right course is to widen the class of people who may apply for reward - Option A - or whether it is safe to remove the restriction altogether - Option B.
Option A
14.12 Documents have to be completed properly and executors need to be aware of any irregularities in the drafting of the will. There is also a possibility, should the restrictions go altogether, of a new breed of unregulated probate practitioner. The Probate Registry cannot be expected to pick up every mistake or attempt at fraud. It might be sensible to provide that applications for reward should only be made by specific classes of person who are likely to be reputable and who may well be regulated by statute or a professional body.
14.13 The obvious examples of such classes (apart from solicitors, barristers and notaries) are:-
(a) trust corporations; (b) licensed conveyancers; (c) authorised practitioners - as proposed in the Consultation Paper on Conveyancing by Authorised Practitioners; and (d) chartered and certified accountants.
14.14 The list in para 14.13 is not intended to be exhaustive and the Government would wish to consider representations from any other class which considers it might properly be included.
14.15 As explained in para 14.4, at present only solicitors may make applications for a grant without attending the Registry in person. It would seem to be both sensible and simple to put all the classes which are ultimately accepted in exactly the same position.
Option B
14.16 It is difficult to assess the practical as opposed to the theoretical problems of unregulated probate practitioners setting up in business. Furthermore, if there is a specific list of accepted persons, as suggested in para 14.13, there will inevitably be applications from those who would wish to add themselves. Option A may therefore cause more trouble than it is worth if the risk of fraud and error is very small. On the other hand, where fraud or error does occur the public would be less well protected in the case of unregulated probate practitioners. In addition, if anyone were able to apply for a grant as agent for another, it would be less justifiable to relax the requirement that all those except solicitors must attend the Registry in person. It would not be sensible to remove the requirement altogether, as it does help the Registry to ensure as far as possible that applications are made by the person properly entitled. On the other hand, any attempt to define those who need not attend seems to be a partial return to Option A.
Under either Option A or B, for those who do not make an application for a grant through a solicitor or notary, there is a further obstacle in the way of a one-stop probate service. Only a solicitor or notary may administer the oaths referred to in paras 14.3(a) and (b). This raises the question whether the requirement to swear an oath is too cumbersome and should be removed, on the understanding that making a dishonest unsworn statement for the purpose of an application would continue to be a criminal offence. The Government would welcome views on this suggestion.
Although the Government intends to remove the restrictions in non-contentious cases, it is not proposing to remove them in cases which are or become contentious. Such cases need to conducted by those with the necessary skill and training to conduct litigation and appear in court.
Possible special controls (a) Code of conduct
14.20 In the past it was suggested that there should be a code of conduct if trust corporations were to be allowed to apply for probate. The Government considers that there is no merit in this suggestion. As previously explained, the application for probate is a very small part of the administration of an estate and the code would not apply to the rest. It is also difficult to know what it could provide other than that applications should be made competently and honestly. Furthermore, the overwhelming majority of applicants will already be subject to statutory or professional controls over the way they conduct themselves.
(b) Charges
14.21 An anxiety often expressed about banks is that their charges for executorship are too high and are not subject to controls as are the charges of solicitors. (Benson, as a qualification to its general recommendation about trust corporations, proposed that charges by those who are not solicitors should be subject to control.)
14.22 In the past the banks have argued that one reason why their charges are high is because they have had to pay solicitors to do work which they have virtually done already. Whether this is true or not, the Government believes that in principle prices should be set by market forces and that its role is confined to ensuring that prices are clearly and truthfully expressed. Banks publish tables of fees. It is up to the testator to make his choice. This now also seems to be the view of the Law Society.
Summary
14.23 The government would welcome views on whether (a) anybody should be entitled to make applications for grants of probate or letters of administration; or
(b) only specified classes of person and, if so, who should they be?
(c) the requirement to swear an oath should be abolished. At the moment:—
(a) the UK is already bound by the requirement of the EC treaty to abolish restrictions on the freedom of establishment of nationals of a member state in the territory of another member state and by the requirement to abolish restrictions on freedom to provide services within the Community;
(b) discrimination on the grounds of nationality which might prevent lawyers from one member state practising in another is not permitted;
(c) UK lawyers, either as firms or individuals, are permitted to practise under their home state title in EC member states without acquiring a local qualification provided that they do not engage in work reserved for the host legal profession; and
(d) under the Legal Services Directive of 1977 a lawyer from one member state has the right to plead in the courts of another member state provided that he acts in co-operation with a local lawyer who has rights of audience before the court or tribunal in question.
The plans to achieve a single internal market from the end of 1992 will have further consequences for the provision of legal services in EC member states:—
(a) The Council Directive on a general system for recognition of higher education diplomas, adopted by the Council of Ministers on 21 December 1988, will promote the freedom of members of professions to provide services throughout the EC and make it easier for a professional in one member state to practise in other member states as a member of the local profession. Member states have two years in which to take the measures necessary to comply with the Directive. As far as lawyers are concerned, member states will have a choice between requiring an incoming professional to take an aptitude test or go through an adaptation period. Accordingly once he has completed the aptitude test or adaptation period and satisfied other relevant conditions, he will be entitled to admission as a full member of the host state legal profession;
(b) there will be an increased demand as a result of the directive both for host state practice (e.g. UK lawyers acquiring the local qualifications in another member state) and for home state practice (e.g. UK lawyers practising in other member states without acquiring local qualifications). It will be important to safeguard the possibility of establishment under both methods; and
(c) there will be an increased demand to remove restrictions on multi-national practices.
As far as the law itself is concerned there is likely by 1992 to be both an increased body of English law implementing EC directives and an increased body of EC law. Both business and private clients will be affected. Business clients especially are likely to become more active in the common market. They will need advice on matters such as the best place and form in which to set up business, whether there are advantages in having their contracts governed by the law of a particular state, and the proper forum in which to bring proceedings. Only those English lawyers prepared to develop an expertise in European Community law and practice and the law of EC Member States will be in a position to offer this advice. English lawyers who do not will lose the opportunity to compete both in the European market and at home. THE PROVIDERS OF LEGAL SERVICES
Barristers
1 The General Council of the Bar is the governing body of the Bar. It is responsible for policy matters affecting the Bar and for the professional conduct of barristers. Every barrister must be a member of one of the four Inns of Court (Lincoln's Inn, Inner Temple, Middle Temple, and Gray's Inn). The Inns have the sole right to call men and women to the Bar and to disbar them in the event of misconduct.
Qualification
2 There are three stages to qualifying as a barrister. The first, or academic, stage consists of a law degree or, for non-law graduates, a one year Diploma Course in substantive law. The Bar usually requires as a minimum a second class honours degree before allowing students to proceed to the second, or vocational, stage of training. This is run by the profession and currently consists of a 30-week course at the Council of Legal Education leading to the Bar Final examination. Once the student has passed the Bar Finals, and provided that he or she has kept the requisite number of terms at their Inn of Court (which normally takes two years), he or she is entitled to be called to the Bar. He or she is not, however, allowed to practise until he or she has completed the third stage of training which is called pupillage. This lasts for 12 months and is similar to an apprenticeship. The pupil is attached to a pupil master, an experienced barrister whose function it is to instruct the pupil in the skills he or she will need to practise at the Bar and to instill in him or her the ethics of their profession. The Bar introduced practising certificates and check lists for pupils in the autumn of 1988. After six months of pupillage the pupil must obtain a certificate from his or her pupil master confirming that he or she has satisfactorily completed the first stage of their pupillage. The Bar Council will then issue him or her with a practising certificate entitling him or her to take cases on their own account. On satisfactory completion of a further six months pupillage, confirmed by the production of a further signed certificate from his or her pupil master, the Bar Council will issue him or her with a Final Certificate enabling him or her to become a fully-fledged practising barrister either in independent practice or employment. There is no requirement that pupil barristers be paid a salary during their pupillage, although various awards and grants are available from the Council of Legal Education, the Inns of Court and an increasing number of sets of chambers. (See para 4 below for an explanation of the chambers system.)
There is no compulsory continuing education for barristers after pupillage, although the Bar has plans to introduce this. Courses are already organised for practitioners on, for instance, the interpretation of company accounts, EC law and matters of interest to the specialist Bar Associations.
Practice at the Bar
In order to practise at the Bar a barrister must, according to the rules of his or her profession, be a member of a set of chambers which includes having the services of a clerk. There were in the autumn of 1988 about 6,000 barristers practising from a total of 359 sets of chambers; 231 of these sets were in London and 128 were in the provinces. Again, according to his or her professional rules, a barrister must practise as an individual (partnerships are not permitted) and, with a few exceptions relating to other professions, a barrister is not allowed to take instructions directly from lay clients but may act only on the instructions of a solicitor. (Direct access to barristers is considered in Chapter 8.)
The employed Bar
Many barristers are employed in commerce and industry and by central and local government. The exact number of employed barristers is unknown although it is likely to be in excess of 5,000. Special professional rules apply to employed barristers: for instance, such a barrister may not supply legal services to the public, most employed barristers are not allowed to instruct counsel directly and, by virtue of a combination of statutory provisions and practice rules, the rights of audience of employed barristers are currently even more restricted than those of solicitors. (See Annex E: paras 19-21.)
Solicitors
The Law Society is the professional body of solicitors. In contrast to the Bar, many aspects of the solicitors' profession, such as entry, practice and conduct and discipline, are regulated by statute (the Solicitors Act 1974, c.47, as amended).
Qualification
As with barristers, solicitors have several stages to their training. The academic stage is satisfied by a law degree, or by passing the Solicitors First Examination (for non-graduates), or by passing the Law Society's Common Professional Examination (a one-year law course for non-law graduates). Completion of the academic stage entitles the student to take the 36-week course leading to the Solicitors Final Examination. As with the Bar, the vocational stage of training is exclusively under the control of the profession. Before being admitted as a solicitor, a student must also serve a period of practical training or apprenticeship called articles. The student is articled to an experienced solicitor for between two and five years, depending on his or her method of qualification. The Law Society prescribes the terms and conditions of articled clerkship and insists that the articled clerk is paid at least the recommended minimum salary, which in the autumn of 1988 was £6,000 in the provinces, £6,900 in outer London and £7,200 in inner London.
From 1 August 1985 the Law Society has required solicitors, in the first three years after admission to the Roll, to attend a system of continuing education. There are compulsory courses in office management and communication, standards of professional conduct and ethics and the handling of professional responsibility. In addition, the newly-qualified solicitor has to attend a certain number of voluntary courses over the three year period.
Practice as a solicitor
Solicitors may practise as sole practitioners or in partnership. In the autumn of 1988 there were 50,337 solicitors holding practising certificates. Between March 1986 and March 1987, the number of solicitors' practices increased by 2.3% in the North (Wales, the North and Midlands above the Severn - Wash Line), 3.9% in the South (including E Anglia but excluding London), and 5.1% in London (the old GLC area).\\textsuperscript{1} When s.9 of the Administration of Justice Act 1985 is brought into force (which is expected to be later this year), solicitors will be able to practise in corporate form with both limited and unlimited liability. Over recent years there has been a tendency for firms of solicitors to amalgamate to form larger units. The latest figures\\textsuperscript{2} indicate that between 1986 and 1987 the number of firms with 11 or more principals increased by 7.5%. These large firms can provide a specialised range of services, especially in the commercial field, and it is possible that such firms are now providing some of the expert advice which was previously given by the specialist Bar.
**Employed solicitors**
In 1987/88 3,258 solicitors were employed by local and national government and 2,892 solicitors were employed in commerce and other employments.\\textsuperscript{3} An employed solicitor who either holds or is exempted from holding a practising certificate is treated in all respects as any other practising solicitor with one proviso, namely, that since he or she has only one client - his or her employer - he or she is generally prohibited by professional rules from doing work directly for the public.
**Notaries**
Notaries, who are often solicitors who have undertaken additional academic and practical training, have a highly specialised legal function. Their main business
\\textsuperscript{1}The Law Society's Annual Statistical Report 1988
\\textsuperscript{2}The Law Society's Annual Statistical Report 1988
\\textsuperscript{3}The Law Society's Annual Statistical Report 1988 is to certify deeds and other documents under their official seal, for use anywhere in the world, so that such documents will be acceptable to judicial or public authorities as proof of the matters attested. For instance, notaries certify documents to take effect abroad, prepare and translate documents for use abroad, translate documents emanating from overseas, protest bills of exchange, certify copies, administer oaths and take affidavits, note and draw up ships' protests and advise on matters of English and foreign law.
Legal executives
Legal executives have both an academic and practical training and work mainly in solicitors' offices and legal departments of large organisations, including central and local government, commerce and industry. In practice legal executives are able to do all the work of solicitors except the work which is reserved to solicitors by statute (see Chapter 2 paras 2.1-2.2). There were in the autumn of 1988 around 16,500 subscribers to the Institute of Legal Executives.
Licensed conveyancers
This is a new profession established by the Administration of Justice Act 1985. Standards of competence and professional conduct are regulated by the Council for Licensed Conveyancers. There were in early 1989 approximately 500 licensed conveyancers. Licensed conveyancers are licensed to provide conveyancing services as defined by s.11(3) of the Administration of Justice Act 1985 and may act in domestic and commercial transactions. Licensed conveyancers have to pass examinations before being allowed to practise. Their final examination is similar in standard to the final examination taken by solicitors although it obviously covers a much narrower range of subjects namely, conveyancing, landlord and tenant law, organisations and revenue law and accounts. In addition, licensed conveyancers have to complete two years of practical training.
Licensed conveyancers may practise on their own account, although not for the first three years after qualifying, or in partnership. Mixed partnerships with other professions deemed suitable by the Council for Licensed Conveyancers are allowed, although there are no mixed partnerships as yet. Licensed Conveyancers will during 1989 be able to practise in corporate bodies controlled by licensed conveyancers. Licensed conveyancers may be employed by non-licensed conveyancers, but at the moment (see the consultation paper on conveyancing services issued today) they cannot provide conveyancing services to the clients of such employers.
Patent agents
Patent agents are specialist practitioners who deal with obtaining and enforcing intellectual property rights. They have both an academic and practical training and work either in the patent departments of large industrial organisations or in private firms of patent agents. Patent agents no longer have a monopoly on their practice. The Copyright Designs and Patents Act 1988 allows anyone to practise as a patent agent but reserves the use of the title "patent agent" and "patent attorney" to those who are on the register kept by the Chartered Institute of Patent Agents. Solicitors may also use the title "patent attorney".
**Insolvency practitioners**
Under the Insolvency Act 1986 insolvency practitioners practise as trustees in bankruptcy, liquidators, administrators, receivers and supervisors of voluntary arrangements. Insolvency practitioners are usually accountants, solicitors or members of the Insolvency Practitioners Association. Insolvency practitioners have to be authorised by professional bodies recognised for that purpose by the Secretary of State for Trade and Industry. If the practitioner is not a member of a recognised body, then authorisation has to be obtained from the Insolvency Practitioners Association, or, failing that, the Secretary of State.
**Banks, building societies, accountants and chartered secretaries**
Banks, building societies, accountants and chartered secretaries give legal advice to their clients on such matters as taxation, wills, insolvency and company law.
**Law centres**
The first law centre was set up in 1970 in North Kensington, London. There are now around 60 centres. Most of these are concentrated in urban areas. Law centres are staffed by a variety of advisers including salaried lawyers and tend to specialise mainly in welfare law, immigration and housing.
**Citizens advice bureaux** Citizens advice bureaux (CABx) were originally established in 1939 to give emergency services during the second World War. There are now over a thousand such bureaux handling around 6.8 million enquiries a year. CABx give advice on a variety of matters including social security, consumer protection, housing, the family, employment, health, education and immigration and nationality. Most advice is given by trained lay volunteers although most CABx have access to a solicitor on at least a rota basis.
Trade unions
Trade unions provide advice and assistance to their members on employment matters and will usually arrange representation on such matters for their members in tribunals and courts. Some trade unions also provide general legal advice to members either in-house or by referral to an outside solicitor.
The Royal British Legion
The Royal British Legion employs lay people, usually ex-servicemen, to work full-time on advising and representing appellants before the Pensions Appeals Tribunal. These lay people receive on-the-job training and are recognised as having considerable expertise in their field. ACADEMIC AND VOCATIONAL TRAINING
1. The appropriate training for lawyers will be a matter for consideration by the Advisory Committee. It seems sensible, however, that legal education should contain the following four stages: academic, vocational, practical and continuing (i.e. post-qualification) education.
(i) Academic stage
2. The current core subjects are as follows:
- constitutional and administrative law
- contract
- tort
- land law
- trusts
- criminal law
3. Marre has recently suggested that consideration should be given to teaching trusts and land law as a composite subject; and the Advisory Committee may wish to consider recommending this. In view of the thrust suggested for the vocational course (see para 4 below) the Advisory Committee might also consider whether evidence should be included among the core subjects to be studied at the academic stage. In addition, tuition at the academic stage ought perhaps to reflect the increasing importance of financial regulation and the EC. The Advisory Committee will be invited to consider whether and how this could be covered in core subjects at the academic stage.
(ii) Vocational stage
4. The Government considers that the emphasis at the vocational stage should be on the acquisition of the practical skills necessary for practice as a lawyer. The Government agrees with the views expressed in the Ormrod, Benson and Marre reports that there are strong arguments in favour of a common system of vocational training to cover the whole legal profession. The Advisory Committee might accordingly wish to consider giving a high priority to the development of a core of minimum requirements for the vocational stage of training.
These minimum requirements could, for instance, cover:
(a) civil procedure including probate; (b) criminal procedure and sentencing; (c) advocacy; (d) evidence (but see para 3 above); (e) conveyancing; (f) probate; (g) business accounts; (h) solicitors' accounts; (i) the management of a legal practice including computerisation; (j) negotiation and communication skills in both non-contentious and contentious matters; (k) lawyer-client relations (communication, counselling and advising); (l) drafting; and (m) professional ethics and conduct (to include the codes proposed in Chapter 4).
Not every practitioner would need to cover all these subjects: for instance, those marked with an asterisk might be options. It will, of course, be for the Advisory Committee to consider whether the suggested subjects are appropriate. The Committee will also need to consider the actual content of the courses and take into account the fact that students wishing to cover every option may need an extended period of qualification. (iii) **Practical and continuing stages**
Proposals covering the practical and continuing stages of training for advocacy are set out in Chapter 5. It will be for the Advisory Committee in due course to consider the practical and continuing stages of training for other specialisms. Present arrangements of the Bar and the Law Society for handling complaints
Part 1: The Bar
1 Cases before the Professional Conduct Committee of the General Council of the Bar (PCC)
The PCC consists of members of the Bar and a number of lay members nominated by the Lord Chancellor.
(a) Informal procedure Where the conduct disclosed may be dealt with informally, the PCC will inform the barrister in writing of its views and may also direct him to attend on the Chairman of the PCC or some other person.
(b) Summary procedure This is under consideration but has not been introduced. The proposal, however, is that, if the PCC wished to take a matter further without referring it to a Disciplinary Tribunal (see para 2 below) and there was no relevant dispute of fact, a barrister would be afforded the opportunity to make representations, in writing or in person, at a special committee of the PCC, which would have the power to administer an admonishment and reprimand or give advice on future conduct.
2 Cases before a Disciplinary Tribunal
More serious cases or those where there is a relevant dispute of fact are prosecuted by the PCC before a Disciplinary Tribunal. A Tribunal is chaired by a Judge and has four other members including one lay member. Less serious cases relating to breach of professional standards are treated in the same way as cases before the PCC. Where, however, a charge of professional misconduct is proved, barristers may be ordered to repay or forego fees or may be suspended or disbarred.
3 Hearing before the Visitors Appeal from the Disciplinary Tribunal lies to not fewer than three Judges of the High Court nominated by the Lord Chief Justice after consultation with the Lord Chancellor and known as the Visitors. There is no further internal appeal.
Part 2: The Law Society
The Solicitors' Complaints Bureau Complaints are first considered by the staff of the Bureau who prepare the cases for further consideration or else inform the complainant that there is no issue of conduct or shoddy work. The Investigation Committee monitors the way the Bureau handles complaints. The Adjudication Committee exercises the Law Society's disciplinary and other relevant powers.
(a) The Investigation Committee This has seven lay members, including the Chairman, and four solicitor members, two of whom are also Law Society Council members. Its functions are:-
(i) to review cases going to the Adjudication Committee and make recommendations for further investigation, if it thinks it necessary;
(ii) to review cases where the investigating officer wishes to terminate an investigation, but the complainant does not;
(iii) to review cases before a file is referred to the Lay Observer and review reports of the Lay Observer; and (iv) to make formal recommendations to the staff for improvements in procedure.
(b) The Adjudication Committee This has nine Law Society members including the Chairman, three other solicitors and six lay members. It has a large number of powers and in particular may:-
(i) take disciplinary proceedings against a solicitor at the Solicitors' Disciplinary Tribunal;
(ii) rebuke solicitors;
(iii) discipline solicitors for shoddy work, e.g. order rectification of the mistake or the remission of fees;
(iv) order an inspection of accounts;
(v) intervene in a practice to protect the interests of a client;
(vi) impose conditions on a practising certificate;
(vii) order payment of interest on a client's money; and
(viii) order payments out of the compensation fund when a person has suffered loss as a consequence of a solicitor's dishonesty. This Committee is established by statute and exercises the delegated powers of the High Court. It considers the most serious cases of professional misconduct. Complaints are usually referred by the Solicitors' Complaints Bureau, but they may also be made direct by the public or in certain cases by the Lay Observer. It normally sits with three members, at least one of whom must be lay. The members are appointed by the Master of the Rolls. It has powers to strike off the roll, suspend, fine or reprimand.
6 The High Court Appeal from the Solicitors' Disciplinary Tribunal lies to the High Court. In addition the High Court retains its general supervisory jurisdiction over the profession. Applications may be made direct to the High Court to cause a solicitor to answer allegations.
7 The Lay Observer He is an independent office-holder appointed by the Lord Chancellor. Section 45(1) of the Solicitors Act 1974 empowers him to examine any written allegation made by or on behalf of a member of the public concerning the Law Society's treatment of a complaint about a solicitor or his employee. The Lay Observer is only able to report on this treatment and to make recommendations. He has no powers to reinvestigate the complaint. When a complaint raises an issue of both conduct and quality of services, he may, in those circumstances only, make an application to the Solicitors Disciplinary Tribunal in respect of the quality of services. Rights of audience in the courts of England and Wales
1 A litigant in person, that is a party to proceedings who is not represented by a lawyer, has a right of audience in his or her own cause in all courts and tribunals. A barrister practising from chambers has a general right of audience on behalf of his or her clients. The rights of audience of solicitors in private practice are more limited. The rights of audience of employed lawyers are more restricted still. By virtue of the European Communities (Services of Lawyers) Order 1978 (SI 1978 No.1910) an EC lawyer may appear before any court, tribunal or public authority in the UK provided that throughout the proceedings he or she is instructed with, and acts in conjunction with, an advocate, barrister or solicitor who is entitled to practise before the court tribunal or public authority concerned and who could properly provide the service in question.
The Magistrates' Courts
2 The Magistrates' Courts deal with around 90% of the total criminal workload at first instance. They also deal with care proceedings in respect of juveniles and licensing applications, and have a sizeable domestic jurisdiction. Decisions on both fact and law are taken either by a bench of lay magistrates or by a stipendiary (legally qualified) magistrate, sitting without a jury.
3 Rights of audience are governed by statute, currently s.122 of the Magistrates' Courts Act 1980. This provision derives from s.2 of the Trials for Felony Act 1836 (6 & 7 Will. 4, c. 114) enacted to reform the law following the decision in Collier v Hicks (1831) 2 B & Ad. 663 in which it was held that no person had a right to act as an advocate on the trial of an information before justices of the peace. without their permission. The Magistrates' Courts Act 1980 s.122(1) provides that a party to any proceedings before a magistrates' court may be represented by counsel (i.e. a barrister) or solicitor. In addition, various statutes such as the Local Government Act 1972 s.223 and the Customs and Excise Management Act 1979 s.155, give specified persons authority to conduct particular prosecutions, although they may not be counsel or solicitor. The Magistrates' Court also has a discretion to allow someone else to act on behalf of either party to the proceedings.
The Crown Court
4 The main jurisdiction of the Crown Court is in criminal proceedings. Apart from cases committed for trial from the Magistrates' Courts, the Crown Court deals with appeals from the Magistrates' Courts against conviction and sentence. It also hears appeals from decisions of magistrates in care proceedings in juvenile cases, appeals from the decisions of justices in licensing matters and appeals from local authorities and chief officers of police under various statutes. The Crown Court has a small original civil jurisdiction, such as applications under the Reservoirs (Safety Provisions) Act 1930. In criminal cases, the court is presided over by an Assistant Recorder, Recorder, Circuit Judge or High Court Judge. In trials on not guilty pleas the judge sits with a jury whose function it is to decide whether the charge against the accused person has been proved. Lay magistrates sit with the legally qualified judges on some cases and appeals.
5 Barristers practising from chambers have a right of audience in all cases in the Crown court. Rights of audience for solicitors are governed by s.83 of the Supreme Court Act 1981 (reproducing the now repealed s.12 of the Courts Act 1971). This provides as follows:- "(1) The Lord Chancellor may at any time direct that solicitors may appear in, conduct, defend and address the court in any proceedings in the Crown Court, or proceedings in the Crown Court of any description specified in the direction.
(2) A direction under this section may have effect as respects all places where the Crown Court sits, or as respects a specified area, region or circuit, or as respects one or more specified places where the Crown Court sits.
(3) In considering whether to exercise his powers under this section as respects any one or more specified places where the Crown Court sits, the Lord Chancellor shall have regard to any shortage of counsel in the area in question, any rights of audience formerly exercised by solicitors at any court of quarter sessions in the locality in question, and to any other circumstances affecting the public interest.
(4) Any direction given under this section may be subject to such conditions and restrictions as appear to the Lord Chancellor to be necessary or expedient."
By virtue of directions made by the Lord Chancellor on 7 December 1971, 9 February 1972 and 15 August 1988, solicitors have rights of audience in:-
(a) appeals to the Crown Court from a Magistrates' Court or on committal for sentence, if the same firm appeared in the court below;
(b) civil proceedings in the Crown Court on appeal in similar circumstances; and
(c) a limited number of cases in remote areas where solicitors traditionally had full rights of audience at Quarter Sessions (Caernarvon, Barnstaple, Truro, Doncaster and parts of Lincoln), which have been replaced by the Crown Court. Rights of audience for Crown Prosecutors (barristers and solicitors) employed by the Crown Prosecution Service are governed by s.4 of the Prosecution of Offences Act 1985. This gives Crown Prosecutors the same rights of audience in the Crown Court as solicitors holding practising certificates; and the Lord Chancellor may give any such directions under s.83 of the Supreme Court Act 1981 in respect of Crown Prosecutors as he could give in respect of solicitors.
The County Courts
These courts have a wide-ranging civil jurisdiction in cases where, generally speaking, the amount in issue does not exceed £5,000, covering debt, breach of contract, personal injury, recovery of land, bankruptcy and insolvency, admiralty, family proceedings and miscellaneous matters such as mental health and sex discrimination. Trials are heard by Assistant Recorders, Recorders or Circuit Judges, and interlocutory matters are heard by County Court Registrars.
Rights of audience in the County Court are governed by sections 60 and 61 of the County Courts Act 1984. The material part of s.60 is as follows:-
(1) In any proceedings in a county court any of the following persons may address the court:-
(a) any party to the proceedings; (b) a barrister retained by or on behalf of any party; (c) a solicitor acting generally in the proceedings for a party to them (in this subsection referred to as a 'solicitor on the record'); (d) any solicitor employed by a solicitor on the record; (e) any solicitor acting as an agent for a solicitor on the record; (f) any solicitor employed by a solicitor so engaged; and By virtue of s.61 of the County Courts Act 1984, the Lord Chancellor may by direction confer rights of audience in the County Court on persons in employment consisting of or including giving assistance to solicitors in the conduct of litigation. Only one such direction has been made to date and that was in 1978 when this power was used to confer rights of audience on Fellows of the Institute of Legal Executives on behalf of their solicitor employer in unopposed applications for an adjournment or applications for judgments by consent.
The High Court
9 The High Court is divided into three Divisions: Chancery, Queen's Bench, and Family. There is no upper limit on its jurisdiction. It deals with a range of heavy civil work covering matters such as debt, personal injury, land and property, breach of contract, bankruptcy and companies proceedings. In addition the High Court deals with public law and various specialist cases, including patents. The three Divisions of the High Court exercise appellate as well as first instance jurisdiction: The Divisional Court of the Chancery Division hears appeals in revenue matters from the Commissioners of Taxes and bankruptcy matters from the County Courts; the Queen's Bench Divisional Court exercises appellate and supervisory jurisdiction over the Crown Court (except in relation to the conduct of trials on indictment), inferior courts and tribunals and the actions and decisions of public bodies under the judicial review procedure; the Divisional Court of the Family Division hears appeals from Magistrates' Courts in domestic matters.
10 The Chancery Division consists of the Lord Chancellor, who is its president, the Vice-Chancellor and such of the High Court judges as are for the time being attached to it. The Queen's Bench Division, which is much the largest, consists of the Lord Chief Justice, who is its president, and such of the High Court judges as are for the time being attached to it. The Family Division consists of the President of the Family Division and such of the High Court judges as are for the time being attached to it. Apart from a few cases in the Queen's Bench Division, for example in some actions for defamation, where juries sit to decide the facts, cases in the High Court are heard by judges who sit alone and have to make decisions on both the facts and the law. Interlocutory matters are dealt with by Masters and District Registrars.
Subject to the 1978 Order mentioned above (para 1), rights of audience in the High Court have not hitherto been regulated by statute, but by the High Court judges acting as a collegiate body (Abse v Smith [1986] 1 QB, 536). It is an established rule that, save in an emergency, a solicitor cannot appear on his client's behalf in open court. According to long custom, barristers have a general right of audience in the High Court, whereas solicitors do not. Solicitors do have a general right of audience in the High Court when sitting in chambers, whether before a judge or Master, which extends to their responsible representatives (such as legal executives). Solicitors may also appear in:-
(a) bankruptcy matters, and (b) formal or unopposed matters where there is unlikely to be any argument and where the court will not be called upon to exercise any discretion.
A solicitor may also represent his client in the Supreme Court when judgment is delivered in open court following a hearing in chambers at which that solicitor conducted the case for the client (Practice Direction: Solicitors: Rights of Audience) [1986] 1 W.L.R.545 issued by the Lord The Court of Appeal
12 The Court of Appeal is divided into the Criminal Division and the Civil Division. The judges of the Court of Appeal are the Lord Chief Justice, who is the president of the Criminal Division, and the Master of the Rolls, who is the president of the Civil Division, together with 27 Lords Justices of Appeal. The President of the Family Division and the Vice-Chancellor also sit in the Court of Appeal for part of their time. The Court of Appeal normally sits in a bench of two or three.
13 The Criminal Division of the Court of Appeal hears appeals against conviction and sentence from the Crown Court in England and Wales. In 1987 the number of applications and appeals registered was 8,320 - a rise of 8% over the number registered in 1986. Courts in the Criminal Division are constituted from the Lord Chief Justice and the Lords Justices assisted by judges of the Queen's Bench Division of the High Court as required. There are no juries.
14 The Civil Division of the Court of Appeal hears appeals from the High Court in civil matters, the County Courts, and various tribunals. Courts in this Division are normally constituted from the Master of the Rolls and the Lords Justices.
15 Rights of audience in both Divisions are governed by the judges of the Court of Appeal acting as a collegiate body (Abse v Smith above). The position on rights of audience is the same as that in the High Court. The House of Lords in its judicial capacity is the supreme court of appeal in Great Britain and Northern Ireland. It adjudicates on matters of law of general public importance. The main judges of the House of Lords are the Lord Chancellor and the Lords of Appeal in Ordinary. An appeal lies to the House of Lords:-
(a) from any order or judgment of the Court of Appeal in England, by leave of that court or the House of Lords, subject to restrictions imposed by statute or by practice in specific matters;
(b) from any order or judgment of any court in Scotland from which error or appeal lay on or before 1 November 1876 by common law or by statute;
(c) subject to statutory restrictions, in exceptional cases direct from a decision of the High Court in England;
(d) from any order or judgment of the Court of Appeal in Northern Ireland by leave of that court or the House of Lords, subject to statutory restrictions; and
(e) subject to statutory restrictions, in exceptional cases direct from decisions of the High Court of Justice in Northern Ireland.
Rights of audience are the same as in the High Court and the Court of Appeal. In addition, Scottish advocates and barristers from Northern Ireland have rights of audience and solicitors may appear before the Appeal Committee of the House of Lords when it is considering a petition for leave to appeal.
The Judicial Committee of the Privy Council
The Judicial Committee of the Privy Council is the final court of appeal for those Commonwealth countries which CONFIDENTIAL
retain the right of appeal to Her Majesty in Council. Its members are normally drawn from among the Lord Chancellor and the Lords of Appeal in Ordinary. In its domestic jurisdiction, the Committee entertains appeals against schemes by the Church Commissioners under the Pastoral Measure Act 1983. The Committee also hears appeals from their disciplinary bodies by doctors, dentists, opticians, veterinary surgeons and members of professions supplementary to medicine; it also hears appeals in prize cases during and after a period of hostilities. Rights of audience, which are governed by custom and not statute, extend to English and Northern Ireland barristers, Scottish advocates and all advocates duly qualified in countries from which appeals lie to the Queen in Council.
The rights of audience of employed lawyers
19 Solicitors employed by non-legal employers, who either hold or are exempted from holding practising certificates, have the same rights of audience on behalf of their employer as solicitors in private practice.
20 The rights of audience of employed barristers are currently more restricted than the rights of employed solicitors. For instance, employed barristers are presently allowed to appear as advocates for their employers in the Magistrates' Court and the County Court only if they are given leave to do so by the court. Employed solicitors, on the other hand, can appear in these courts as of right. This anomaly is the result of the combined effect of the wording of s.122(1) of the Magistrates' Courts Act 1980 and s.60(1) of the County Courts Act 1984 and the provisions of the Third Edition of the Bar's Code of Conduct which deny to employed barristers the status of counsel. It will be removed by the provisions of the Fourth Edition of the Bar's Code of Conduct (due to come into force on 1 February 1989) which will enable an employed barrister to appear on behalf of his employer as counsel in circumstances where barristers in general practice do not have an exclusive right of audience. This alteration to the Code should also enable employed barristers to appear in the same instances as employed solicitors in the High Court, Court of Appeal and House of Lords.
21 Employed lawyers do not have rights of audience in the Crown Court. This is the result of the combined effect of the provisions of s.83 of the Supreme Court Act 1981, the current Directions made by the Lord Chancellor and professional practice rules.
Tribunals
22 At present, there are generally no restrictions on rights of audience before tribunals. This is because, as recognised by the Report of the Committee on Administrative Tribunals and Enquiries (1957 Cmd. 218), the main characteristics of tribunals are, "cheapness, accessibility, freedom from technicality, expedition and expert knowledge of their particular subject." (para 38). Because of these characteristics it is generally considered that most applicants should be able to cope with bringing proceedings without the need for assistance from a qualified legal representative. Assistance may, however, be available from other sources; for instance, trade unions and CABx often represent employees before Industrial Tribunals and also represent applicants before the Criminal Injuries Compensation Board. CABx are also playing an increasing role in representing applicants before Mental Health Review Tribunals. Conveyancing by Authorised Practitioners
Contents
Chapter 1 Introduction
Chapter 2 Background
Chapter 3 The new approach The provision of conveyancing services by employees of lending institutions Authorised practitioners Requirements for authorisation Obtaining authorisation
Chapter 4 Summary of proposals
Annex Proposed code of conduct: main principles CHAPTER 1 - INTRODUCTION
1.1 The Government proposes to legislate to permit a simpler system to be implemented for banks, building societies, other institutions and individuals to provide conveyancing services to clients subject to appropriate safeguards. There is legislative provision for a system of this kind in Schedule 21 to the Building Societies Act 1986, but this Schedule has not been implemented. The Government now wishes to substitute an alternative statutory framework which will be less elaborate than that envisaged in Schedule 21 to the 1986 Act but which will still provide the necessary controls. These proposals will affect only England and Wales.
1.2 The new system will provide for the authorisation of practitioners who will be able to offer conveyancing services to the public. The identity of the practitioners may vary but they will all be required to comply with a set of strict conditions. These will include abiding by a code of conduct and employing sufficient solicitors or licensed conveyancers to supervise or provide the conveyancing services.
1.3 There will be no prohibition against lending institutions providing conveyancing services to their borrowers. The Government is, however, concerned to see that the many independent solicitors and licensed conveyancers throughout the country can compete with such institutions on a fair basis. It therefore invites views on whether authorised practitioners might be required not to subsidise the provision of conveyancing services from their other activities. The same requirement could be placed also upon existing independent solicitors and licensed conveyancers so as to ensure a level playing field for all. The Government would welcome comment on whether this could be achieved, if it was provided that, in order to remain authorised, authorised practitioners had to:
(a) offer conveyancing services at not less than their true cost; and
(b) be able to prove that they were doing this to the satisfaction of their auditors.
It is also for consideration whether any authorised practitioner, who was a lending institution which had offered to add the cost of the conveyancing transaction to the loan, should be required to do this, whether the client chose to use that authorised practitioner or an independent conveyancer to carry out the conveyancing transaction.
Views are therefore invited on whether suitable detailed arrangements could be made to give effect to these proposals.
1.4 It follows from this that there would also appear no longer to be any reason to prevent lending institutions or other potential authorised practitioners from having a shareholding in incorporated licensed conveyancers' practices, when these come into being, since such companies will be required to abide by the relevant professional rules of conduct of the Council for Licensed Conveyancers. At present such a shareholding is prohibited by the rules of the Council, but, if the Government in due course confirms its intention to adopt the proposals set out in this paper, the Council may wish to consider amending accordingly its approach to incorporated practices. The Law Society also might wish in the light of this to review its policy on outside shareholdings. Arrangements linking solicitors and others are considered in Chapter 12 of the Green Paper on the Work and Organisation of the Legal Profession which is published today. CHAPTER 2 - BACKGROUND
2.1 At the beginning of the nineteenth century it appears that there was nothing to prevent anyone at all from setting up as a conveyancer, but in 1804 the legislature made conveyancing the monopoly of the legal profession. At that time there was a considerable number of branches of the legal profession, but most have since dwindled away. Statutory provisions giving the legal profession a monopoly over conveyancing were last re-enacted in the Solicitors Act 1974. Section 22 provided that only solicitors and certain other excepted categories could draft conveyancing documents for reward; and in practice solicitors had the work to themselves.
2.2 In 1983 the Government decided that the existing restrictions should be modified in order to stimulate competition. It was argued that the solicitors' monopoly was wrong, that their costs were too high and that it was not necessary to be a solicitor to draft conveyancing documents. The Government therefore began the process which led to the establishment, by the Administration of Justice Act 1985, of the new profession of licensed conveyancers, who are able to provide conveyancing services in competition with solicitors. In addition in December 1983 the Solicitor General announced that the Government intended to introduce legislation to extend the right of conveyancing to solicitors employed by banks and building societies, subject to safeguards.
2.3 The declared policy was set out by the Solicitor "The Government issued a consultation paper last year seeking views on the way in which conflicts of interest and anti-competitive practices could be avoided if building societies and other financial institutions were to offer conveyancing services to the public. Following that consultation, the Government have concluded that there is no difficulty in principle in such institutions providing conveyancing to persons to whom they are not also offering a loan. However, the Government are not satisfied that lending institutions could safely be permitted to offer both conveyancing and a loan in the same transaction. It is therefore proposed to prohibit lending institutions from providing conveyancing, either directly or through a subsidiary company in which they hold a majority stake, to those who are also borrowing from them.
"The Government are also examining the possibility of estate agents providing a combined service of sale and conveyancing to vendors, and of lending institutions providing conveyancing to borrowers from them through associated companies in which the lender holds only a minority shareholding. Consultation on those matters is not yet complete.
"It is also proposed to set a number of other conditions to ensure proper consumer protection. In particular, institutions will be required to ensure that their conveyancing work is supervised by a qualified person; and adequate arrangements will have to be made to protect the consumer against negligence or fraud on the part of those providing the service”.
2.4 The necessary statutory provisions were placed in section 124 of and Schedule 21 to the Building Societies Act 1986, although these provisions have not been implemented. They allow the Lord Chancellor to recognise institutions - which are defined as "any building society or other body corporate or any unincorporated association" - and individual practitioners as suitable to undertake the provision of conveyancing services. Recognised institutions and practitioners are exempt from section 22 of the Solicitors Act 1974. In addition recognised institutions which happen to be bodies corporate are also exempt from section 24 of the 1974 Act which prohibits bodies corporate from providing conveyancing services.
2.5 The Lord Chancellor was given extensive rule-making powers, in order that he might control these new conveyancers. He may make rules to prescribe the circumstances in which institutions and practitioners may be recognised and the conditions which must be met in order that such recognition may continue (paragraph 2(1) of Schedule 21). He may prescribe appropriate conditions for protecting persons for whom conveyancing services are provided from conflicts of interest (paragraph 2(2)(a)) and for securing that compensation is payable to such persons in respect of negligence, fraud or other dishonesty (paragraph 2(2)(b)). The Schedule also permits the Lord Chancellor to make rules for the manner, form, period and revocation of recognition on specified grounds, (paragraph 3); for the keeping of a list of recognised institutions or practitioners (paragraph 4) and for the delegation of all the Lord Chancellor's functions (except for rule making) to any officer or officers nominated by the rules (paragraph 5). All recognition rules are to be made by statutory instrument.
2.6 The Schedule clearly envisages that the Lord Chancellor will:-
(a) provide an elaborate structure of rules and guidelines to govern the conduct of recognised institutions and practitioners; and
(b) set up administrative machinery which will oversee the granting of recognition, ensure that the rules are observed and, where necessary, will revoke recognition or impose disciplinary sanctions.
2.7 The justification for such a structure would be that there would be insufficient protection and control without it. The Government, however, now considers that adequate alternative machinery could be set up bearing in mind that:-
(a) those organisations and individuals who are most likely to seek and obtain recognition are already regulated by statute and/or professional bodies; and
(b) there will be a requirement that those who carry out or supervise the conveyancing services must be solicitors or licensed conveyancers. (A.) The provision of conveyancing services by employees of lending institutions
3.1 Government policy as stated in 1985 was to prohibit lending institutions from providing conveyancing services, either directly or through a Company in which they had a majority shareholding, to those who were also borrowing from them. The prohibition was the result of unresolved concerns over conflicts of interest which might arise if a solicitor or licensed conveyancer employed by a lending institution acted both for the institution and the borrower. The conflict would be between the solicitor's duty to his employer and the duty to the borrower, who would be his client. Such conflicts could arise where the borrower revealed something to the solicitor or licensed conveyancer which might reduce his chances of obtaining a loan. It was considered that the solicitor or licensed conveyancer might also be in difficulty in giving independent advice about the type of mortgage which would be required and the conditions of the loan.
3.2 The Government no longer thinks it necessary to follow the policy it announced in 1985. It now believes that, although the conflicts of interest outlined in paragraph 2.1 above might arise very occasionally, nevertheless adequate safeguards can be devised and, in the vast majority of cases, the interests of the borrower and the lender in the conveyancing transaction will be identical. Indeed, at present the same solicitors and licensed conveyancers frequently act for both the lending institution and the borrower. For years lending institutions have been willing to use the same solicitor (and are now willing to use the same licensed conveyancer) as the customer at a significant saving to him. The added risk of a conflict of interest where the conveyancer is actually employed by the lending institution appears to be a matter of degree rather than substance and to be relevant only in exceptional circumstances.
3.3 The Government therefore does not consider that the risks are large enough to outweigh the potential benefits of a more relaxed approach, provided that there are sufficient safeguards to offer the borrower an informed choice. These safeguards will be incorporated in the Code of Conduct proposed in paragraph 3.9. A few will be specific to lending institutions - and, it should be pointed out, to any insurance company which might wish to provide conveyancing services to someone taking out an endowment mortgage. Others will be generally applicable to all authorised practitioners. On this basis the Government proposes to allow solicitors and licensed conveyancers employed by lending institutions to undertake conveyancing work on behalf of their employers' clients.
(B.) Authorised practitioners
3.4 The Lord Chancellor no longer intends that he will consider individual applications from those who wish to provide conveyancing services to the public. Instead he proposes to set out a number of requirements which any person, whether an individual, a partnership or a corporate body, must meet before it will be allowed to provide conveyancing services. All those who meet such requirements will be known as authorised practitioners. Requirements for authorisation
3.5 To obtain authorisation the individual practitioner will have to satisfy the requirements set in the following areas:
(i) Suitability to provide conveyancing services
3.6 The practitioner must be fit and proper or be a business which is run by fit and proper people, conducting the business in a prudent and competent manner. Practitioners must also have the experience and competence to provide these additional services. This means that practitioners must either be authorised under statute, like banks or building societies, or obtain authorisation by a recognised authority as indicated in paragraph 3.18. below.
(ii) Employment of a sufficient number of solicitors or licensed conveyancers (or both) to provide or supervise the provision of the conveyancing services
3.7 Although an authorised practitioner will be exempt from section 22 of the Solicitors Act 1974, it will remain a requirement that the conveyancing work must be carried out by those who have the relevant professional expertise.
(iii) Protection of clients' money from improper use
3.8 In order to reduce the risk of dishonesty or the improper use of clients' money, such money must be paid into separate clients' accounts. In addition, in cases where money is held by an authorised practitioner on behalf of a client, he must place it on deposit and pay the client the interest earned. Compliance with the Lord Chancellor's Code of Conduct
3.9 The Lord Chancellor intends to lay down in a statutory instrument a Code of Conduct to be followed by all authorised practitioners. This will impose uniform minimum standards on them and provide a measure against which complaints should be judged. The main principles which the Government proposes should be covered are contained in the Annex to this paper.
Ability to meet claims arising out of conveyancing services
3.10 There will inevitably be claims of financial loss arising out of the provision of conveyancing services. A bad mistake can result in a purchaser acquiring a property which is worth considerably less than he paid for it - because, for example, the conveyancer overlooked a restriction on use or the planning of a new motorway. The practitioner will be required to have adequate professional indemnity insurance or other appropriate arrangements to meet such claims.
Investigation of complaints
3.11 The authorised practitioner must be able to demonstrate, where appropriate to the satisfaction of the relevant recognised authority (see para 3.18 below), that it has suitable internal mechanisms in place, appropriate to the nature and scale of its organisation, to deal with complaints and disciplinary matters.
Suitable compensation arrangements 3.12 It is not possible for anyone to insure against his own dishonesty. There will inevitably be cases where loss is caused by the dishonesty of the practitioner or, in the case of a corporate body, by its directors. The practitioner will therefore be required to be covered by a suitable compensation scheme or to have made adequate bonding arrangements.
(viii) Membership of a suitable ombudsman scheme
3.13 There will be cases where an aggrieved client is either not satisfied about the way the practitioner dealt with his complaint or wishes to complain about possible breaches of the Code of Conduct by the practitioner. Every authorised practitioner will therefore be required to belong to a suitable ombudsman scheme which provides for an independent adjudicator who must at least have powers to:-
(a) investigate the complaint provided it is within a reasonable period of time and is not vexatious or frivolous;
(b) require production of documents;
(c) order the authorised practitioner to pay the complainant compensation for the loss, expense or inconvenience caused by the action;
(d) direct the authorised practitioner to take action to correct the complaint (this could include suspending the taking on of new business for a fixed period or until the problems have been remedied); (e) require a practitioner to abide by his ruling within a specified period as a condition of membership of the scheme (in practice, this means that the practitioner will either have to accept the ruling or resign from the scheme, thereby disqualifying himself or itself from authorisation); and
(f) report to the relevant recognised or other supervisory authority where a complaint against an authorised practitioner reveals a persistent breach of the code of conduct or a systemic fault.
(ix) Adequate arrangements for protecting clients should an authorised practitioner cease providing conveyancing services.
3.14 An authorised practitioner may cease, or go out of, business for any number of reasons including death, illness, disciplinary action or bankruptcy. In the case of solicitors and licensed conveyancers who cease practice, there are statutory provisions whereby clients' money is protected, and professional colleagues may intervene in the practice in order to return papers to clients. Very often the intervening colleague is willing to take over the file of any client prepared to instruct him. Similar arrangements will be required in the case of authorised practitioners so that clients are properly protected.
(C.) Obtaining authorisation
3.15 Those who may wish to become authorised practitioners may be divided into two categories.
(i) Banks and Buildings Societies 3.16 These businesses are already regulated and subject to prudential regulation:-
(a) **Banks** An institution wishing to operate a deposit taking business must be authorised by the Bank of England under the Banking Act 1987; and
(b) **Building Societies** No building society may raise money from its members unless it is authorised to do so by the Building Societies Commission under the Building Societies Act 1986.
3.17 No bank or building society is authorised unless it is established that it is run by fit and proper persons in a prudent manner. Accordingly the Government believes that all banks and building societies should be allowed to operate as authorised practitioners provided they certify to their regulatory authorities that they can comply with all the other requirements set out in paragraphs 3.7 to 3.14.
(ii) **Others**
3.18 Others wishing to become authorised practitioners will be required to submit themselves to the supervision of an authority which can satisfy the Lord Chancellor that it is able to impose and enforce the necessary requirements set out in this paper. Such authorities will be known as recognised authorities. Some intending practitioners, such as surveyors, valuers and insurance brokers, may already be regulated by authorities which will easily be able to enforce the relevant new requirements. Others, like estate agents and the new mortgage lending companies, may find it necessary to set up new authorities or, if they wish, a single new authority, with a single ombudsman scheme. Indeed, although there will be no statutory requirement to this effect, all authorised practitioners, however regulated, might find it sensible to set up a single ombudsman scheme rather than finance a number of separate schemes. 4.1 In summary, the Government therefore proposes:—
(a) to repeal section 124 of and Schedule 21 to the Building Societies Act 1986; and
(b) to introduce legislation which will provide for the authorisation of practitioners who can satisfy the requirements set out in paragraphs 3.6 to 3.14 of this Paper.
4.2 The Government would welcome comments on these proposals. They should be sent to arrive not later than 2 May 1989 to:—
Room 417 Lord Chancellor's Department Trevelyan House 30, Great Peter Street London SW1P 2BY PROPOSED CODE OF CONDUCT: MAIN PRINCIPLES
(A.) Proper supervision of conveyancing services
1. One individual must be responsible for the direction and supervision of the conveyancing services.
Each authorised practitioner must have one named person, who is directly responsible for ensuring that the conveyancing services are carried out according to this code.
2. A sufficient number of solicitors or licensed conveyancers (or both) must be employed to enable the conveyancing services to be provided by suitably qualified persons or under their immediate supervision.
As explained in paragraph 3.7 of the paper, it will remain a requirement that the conveyancing work must be carried out by those who have the relevant professional expertise.
(B.) Conflicts of interest
3. Subparagraphs (a) and (b) below will apply in any case where the authorised practitioner is a lending institution (or is a subsidiary of a lending institution) and wishes to provide conveyancing services for any person to whom the lending institution has lent or is proposing to lend money which was or is to be applied in or towards the acquisition of an estate or interest in land. The authorised practitioner must:- (a) make it clear that independent financial advice is not available from the conveyancer; and
(b) explain the terms and conditions of the loan or offer in a clear and straightforward manner.
A conveyancer employed by a lending institution (or by an insurance company providing an endowment policy) would not be able to give independent advice, but in this he would be no different to tied agents in other financial markets. The vital consideration is that the borrower understands this. As long as he does, he will still have the option of seeking independent legal advice about alternative financial packages. It is worth pointing out, however, that under the current system it seems clear that a significant proportion of home buyers do not approach their conveyancers until they have arranged their mortgage, and do not therefore look to them for financial advice.
4. The client must be made specifically aware that information disclosed by the client to the conveyancer may be used by the authorised practitioner in respect of any other service it is providing or intends to provide.
An independent conveyancer would have a duty of confidence to the client. However, an employed conveyancer would also have a duty to his employer and must make it clear to the client that no relevant information disclosed can be kept from the employer. Such information could therefore be used by a lending institution in assessing a borrower's suitability for a loan or by a firm of surveyors in assessing whether the client will be able to pay for an expensive structural survey. 5. (a) A recognised practitioner must not provide conveyancing services in any case where the interests of the practitioner or any associate of the practitioner may conflict with those of the person making use of the services.
(b) "Associate" in sub-paragraph (a) would cover partners, subsidiary or holding companies, companies of which the practitioner is a director and, where the practitioner is an individual, any members of his family.
Clients need to be protected from situations where the interests of the authorised practitioner put at risk his duties to the client. The obvious example is where the practitioner has a direct financial interest because it owns or is seeking to buy the property in question. Principles 6 and 7 below are particular examples of where conflict is likely to arise and where, subject to certain safeguards, it may be considered that a potential conflict can be regarded as overcome.
6. (a) An authorised practitioner must not accept instructions from or continue to act for any person whose interests conflict with those of any other person by whom the authorised practitioner is also instructed.
(b) In particular an authorised practitioner must not act for both parties to a transaction except where it appears that there is no conflict of interest between the parties and both have consented in writing
(i) to its acting; and
(ii) to its ceasing to act for both parties, should a conflict of interest subsequently arise. Subparagraph (a) is a broad statement of principle. It would cover not only acting for both parties, but also a situation where the vendor (V) is selling to purchaser one (P1) who is selling to purchaser two (P2) and the authorised practitioner is instructed by V and P2. Although a conflict may be unlikely, the practitioner needs to be aware that it could arise.
Subparagraph (b) is specifically directed at acting for both vendor and purchaser. It follows the approach of the Licensed Conveyancers Practice Rules which permit licensed conveyancers to act for both parties on these very stringent conditions.
One obvious example of where a conflict may arise is where an estate agent acting on behalf of a vendor wishes to provide conveyancing services for both vendor and purchaser.
A particular problem which will need to be sorted out when the relevant rules come to be drafted is how to deal with authorised practitioners who have more than one office. This is obviously the case with most lending institutions. It may be safe to provide that in most cases where one branch office acts for the vendor and another for the purchaser each office may be treated as a separate practitioner, but equally there may need to be provisions which ensure that they act independently of one another.
7. When the authorised practitioner enters into an arrangement with another person for the introduction of clients to the authorised practitioner or by the authorised practitioner to the other person it must ensure:-
(a) that the client is informed in writing of the arrangement and of any commission or other benefit the authorised practitioner may be receiving or pay; (b) that it obtains the client's written agreement as to the destination of the commission or else it shall account to the client for the commission; and
(c) that it remains able to advise the client regardless of its own interests.
A client must be entitled to know whether the authorised practitioner is making any hidden profit or is paying any third party who referred the client to the authorised practitioner.
(C.) Contractual obligations
8. An authorised practitioner must give to each client, before it may accept instructions to act, an estimate of the total cost which the client will or may have to meet. This must set out
(a) the way in which fees will be calculated;
(b) the circumstances in which they might be increased; and
(c) the particulars of expenses and tax likely to be charged to the client
Clients must be entitled to know before they enter into a contract with the authorised practitioner what the likely cost of the transaction will be.
When the authorised practitioner is a lending institution and offers to add the cost of the conveyancing transaction to the loan, it must give the client an indication of what he is likely to pay over the period of the loan compared to what he would pay if he met the cost on completion. Any such lending institution, which has offered to add the cost of the conveyancing transaction to the loan, must also be ready to do this, whether the client chooses to use that lending institution or an independent conveyancer to carry out the conveyancing transaction.
9. When an authorised practitioner offers conveyancing and other services to a client it must ensure that the statement required under Principle 8 sets out separately the cost of each service.
The client needs to be able to make an informed choice between the cost of in-house and independent conveyancing services.
10. Authorised practitioners must not offer conveyancing services below their true cost and must provide annual proof that they are complying with this requirement.
The Government is anxious to ensure that the competitive position of independent conveyancers is not put at risk by authorised practitioners subsidising the provision of conveyancing services by their other activities. It therefore requires authorised practitioners not to offer conveyancing services below their true cost. Authorised practitioners must be able to demonstrate this at least once a year to the satisfaction of their auditors who must certify that this condition is being met.
11. An authorised practitioner must not make the provision of:
(a) conveyancing services conditional on any other service being taken; or (b) any other service conditional on conveyancing services being taken.
Such a prohibition against "tying-in" is essential. There is an obvious risk that, for example, a lending institution will tie in the conveyancing services to the loan, thus making the borrower accept the whole package. Since the loan is so vital, this would effectively prevent the borrower from seeking independent legal or financial advice. Similarly, although the client would feel under less pressure to accept, a surveyor might wish a client to accept a combined estate agency/survey/conveyancing package. If this were permitted, it might well force independent conveyancers out of business and so reduce competition.
12. An authorised practitioner must not contractually limit its liability for damage suffered by the client as a result of negligence on its part.
13. An authorised practitioner must set out in writing the terms upon which instructions will be accepted and give them to the client before accepting instructions.
(D.) Conduct of business
14. An authorised practitioner must deal with correspondence and other matters arising in the course of a conveyancing transaction with reasonable speed and must not by his actions or omissions cause unnecessary delay.
Authorised practitioners will be required to act in a professional manner. These purpose of this and the following principles is to ensure that this happens. These principles will:- CONFIDENTIAL
(a) help to avoid any conflict between the authorised practitioner and the employed professional conveyancer by imposing the same rules of conduct as the professional conveyancer would expect to meet in private practice;
(b) demonstrate to independent conveyancers acting for other parties that authorised practitioners are not exempt from the usual professional standards; and
(c) offer guidance to ombudsmen and other interested parties in the case of complaints.
15. An authorised practitioner must ensure that clients are kept adequately informed of the progress of the transaction.
Failing to keep clients properly informed causes misunderstanding and anxiety. It leads to mistakes and complaints.
16. An authorised practitioner must treat all facts and information concerning the client obtained by it in the course of acting for the client as confidential and must not at any time make any unauthorised use of such facts or information.
17. An authorised practitioner must not delay completion of any transaction solely on the ground that its fees are outstanding.
18. An authorised practitioner must comply fully with every undertaking given on its behalf during any conveyancing transaction.
19. When an authorised practitioner is instructed by a vendor to submit forms of contract to more than one prospective purchaser, it must obtain the client's authority to disclose this fact to all prospective purchasers. If that authority is not given, it must withdraw from the transactions.
20. An authorised practitioner must not withdraw from transactions without good cause.
An authorised practitioner must not cease to act merely because it no longer wishes to represent a client. There should be a good reason for its withdrawing, for example because a conflict of interest is discovered or the authorised practitioner is unable to obtain instructions from the client. CABINET
DRAFT WHITE PAPER ON THE REFORM OF THE NATIONAL HEALTH SERVICE
Note by the Secretary of the Cabinet
The draft White Paper on the Reform of the National Health Service was circulated to all members of the Cabinet under the memorandum by the Secretary of State for Health - E(A)(89) 2. The Sub-Committee on Economic Affairs of the Ministerial Steering Committee on Economic Strategy approved the White Paper in principle at its meeting this morning and the White Paper will be considered by the Cabinet on 26 January. It is not being re-circulated as a separate Cabinet paper.
Signed ROBIN BUTLER
Cabinet Office 24 January 1989 CABINET
ECONOMIC STRATEGY
Memorandum by the Chancellor of the Exchequer
The United Kingdom economy, which saw above average growth in 1987, continued to grow rapidly in 1988, largely as a result of an investment boom, but also reflecting continued strong consumer demand. With profitability now at its highest levels since the 1960s and with continued rapid growth in productivity, companies are in a very strong position and have been investing heavily to meet future demand. Consumers have seen their real incomes rise significantly and have felt more confident about the future; as a result they have been prepared to finance their spending by borrowing more.
02. The upshot is that total domestic demand has risen faster than the economy's capacity to supply, leading to a re-emergence of inflationary pressure, manifesting itself both directly in a pick-up in the underlying increase in the Retail Price Index (RPI), and indirectly in a sharp growth in imports and hence a widening current account deficit.
03. Since the summer, monetary policy has been tightened substantially to deal with the emerging inflationary pressure. The evidence from retail sales, from the housing market and from the narrow indicators of monthly growth (MO) is that this tightening is starting to bring the economy back to a sustainable path, but there is still some way to go, on inflation in particular. The RPI exaggerates the extent of the rise in prices because of the perverse inclusion of mortgage interest payments. But even so, getting inflation on to a clear downward path will mean keeping interest rates high for some time. Fiscal policy has been considerably tighter than forecast over the past year and we now seem set for a Public Sector Debt Repayment (PSDR) appreciably greater than the £10 billion I indicated in the Autumn Statement.
04. I am sure, in the circumstances, that we must aim for a cautious approach to the Budget. Sound and prudent financial policies are essential if we are to maintain the confidence of the markets and sustain the improvement in economic performance of recent years. If we succeed in reversing the recent rise in inflation, while containing our policies to improve the efficiency and flexibility of the economy, the prospect remains a very good one. ECONOMIC PROSPECTS
05. As in the United Kingdom, growth in the rest of the world in 1988 was more buoyant than forecast a year ago, exceeding expectations in each of the major industrial countries, in most cases substantially so. World trade in manufactures probably grew by 10 per cent. Even those European economies that have been sluggish in recent years are now experiencing faster growth. Partly as a result, consumer price inflation edged up a little in a number of countries and most commodity prices have risen.
06. The latest indicators suggest that activity in the major economies remains strong, though increases in short term interest rates to counter rising inflation may lead to some slow down through 1989. Gross National Product growth may fall from 4 per cent in 1988 to a still healthy 3 per cent this year. World trade growth should still be high.
07. One threat to this prospect is that the persistence of sizeable current account surpluses between the largest economies could lead to renewed turmoil in financial markets. Domestic demand growth in the United States needs to slow, and the United States Government needs to reduce its Budget deficit. At the same time, the surplus countries - Germany and Japan - need to remove the obstacles which restrict the growth of their domestic markets.
08. The United Kingdom has experienced a sharper acceleration of output than most of its Group of Seven partners, with unemployment falling faster than in any other major country. In spite of the major problems in interpreting recent macroeconomic statistics it looks as if we have now had two successive years with Gross Domestic Product growth at about 4½ per cent, the first time this has happened since the mid-sixties. Domestic demand probably grew considerably more quickly than this in 1988, mainly because of the strength of investment, but also reflecting continued rapid growth in consumer spending. It seems likely that the growth of total fixed investment will have been well into double figures last year - the largest increase for almost 20 years. Indeed once the full figures are available it is possible that growth of investment even surpassed that recorded in 1964 - hitherto the best year for investment growth since the War. At the same time, productivity in manufacturing has continued to grow rapidly.
09. Apart from fixed investment, the housing market has been the other major source of the rapid growth in domestic demand. A significant house price bubble emerged last year and with it a rapid turnover in housing. It is likely this had a significant effect on consumption in general and spending on durables in particular.
10. As already mentioned, the increase in inflationary pressure has been countered by the only effective means: a tightening of monetary policy via higher short term interest rates. There are now increasing signs that this firm action has begun to check the growth of spending by households. Growth of the narrow measure of the money supply, M0, has begun to slow down appreciably. The housing market has cooled down markedly, particularly in the South East, with both house prices and lending for... house purchase rising much less rapidly than in the middle of last year, and showing signs of falling in some areas. The growth of retail sales in general has moderated, and sales of some consumer durables have fallen. Indicators of consumer confidence suggest that expenditure growth in the year ahead will be modest. The personal sector savings ratio should as a result begin to recover.
11. Meanwhile, company sector saving remains high and the signs are that the very strong investment performance of the last two years will continue in 1989, though growth will probably be at a less heady pace. The rate of return on capital is at its highest level for over twenty years, and the extra investment that this is generating will help to underpin the supply side improvements of recent years.
12. The latest rise in the mortgage rate will almost certainly lead to inflation as measured by the RPI rising above 7 per cent for some months (although excluding mortgage interest payments the rate should remain below 6 per cent). As the effects of the rises in mortgage rates during the last year begin to drop out, RPI inflation itself should fall back to well below 7 per cent by the fourth quarter of this year. The rise in inflation during the first half of this year will undoubtedly cause us considerable problems. We must clearly do everything in our power to ensure that it does not lead to a pay explosion.
13. The underlying rate of inflation - whether measured by the RPI less mortgage interest payments or by producer prices - is lower, but still much too high. We will have to maintain the present very tight monetary policy long enough to ensure that it is put firmly on a steady downward trend.
14. The sharp worsening of the current account deficit may be exaggerated to some extent by the published figures. The preliminary estimate published for 1988 is £14 1/4 billion, but the (positive) "balancing item" in the balance of payments - which consists of unrecorded flows to the United Kingdom - for the first three quarters (the latest available period) was even greater than the recorded deficit. Nevertheless, the current account deficit remains a large one. The slowdown in domestic demand will lead to its reduction, but this is unlikely to occur quickly. The continued strong growth of investment could keep imports of capital goods high for the time being, and it may take a little while for the adverse effects on trade performance of very high capacity utilisation in some industries to unwind. Even though the deficit could well fall during the coming year, the outturn for 1989 as a whole might be much the same as that for 1988.
15. To summarise, following a prolonged period of above average growth the likelihood is that growth will be well below trend over the coming year. GDP in 1989 could still be 2 1/2 per cent higher than in 1988, though with the statistics for the recent past in such disarray and the economy at a turning point the forecast is even more uncertain than usual. FISCAL PROSPECTS
16. In last year's Budget I announced major tax reforms, including cuts in both the basic and higher rates of income tax. Yet despite this I budgeted for a PSDR in 1988-89 of some £3 billion, or 3/4 of a per cent of GDP. In the event, the public finances have turned out considerably stronger. The forecast I gave in the Autumn Statement was for a PSDR of £10 billion, or 2 per cent of GDP. Later information suggests that the surplus will comfortably exceed even this.
17. This remarkable improvement in the fiscal position - no other major country enjoys a comparable surplus - owes much to the buoyancy of the economy, as well as somewhat higher privatisation proceeds than originally planned. Given the continuing strength of domestic demand, the need for a cautious approach to policy, and market expectations, it is essential to maintain a prudent fiscal stance. In present circumstances I believe we must aim for another sizeable PSDR in the coming financial year.
18. Thus despite the massive Budget surplus the scope for reductions in taxation must inevitably be limited this year. It may prove best to do little more than offset the natural tendency for the non-oil tax burden to rise as a result of fiscal drag. Looking further ahead, the return to a sustainable growth rate is likely to lead to some reversal of the favourable cyclical effects on public finances which we have recently experienced. So future reductions in taxation will depend crucially on our continued ability to restrain the growth of public expenditure.
SUMMARY AND CONCLUSIONS
19. Output growth in the last two years has been faster than we can sustain in the medium term. Some slowdown is inevitable. With the current account likely to improve only rather slowly, we must avoid taking any risks which damage the credibility of our policies. This means a cautious Budget and a further year of substantial budget surplus.
20. I would welcome colleagues' views on the Budget against the background of the fiscal and economic prospects I have outlined.
N L
Treasury
14 February 1989
### Table: Economic Indicators
| Year | 1981 | 1982 | 1983 | 1984 | 1985 | 1986 | 1987 | 1988 | 1989 | |------|------|------|------|------|------|------|------|------|------| | GDP, (2) in % change | 1½ | -½ | 3 | 5 | 3½ | 2½ | 3½ | 4 | 3 | | GDP, (2) per cent change | -1 | 1¼ | 3½ | 1½ | 3½ | 3½ | 4½ | 4½ | 2½ | | Elastic demand, (2) per cent change | -1½ | 2½ | 4½ | 2½ | 2½ | 4 | 4½ | 7 | 2½ | | Oil prices Q4 per cent change | 12 | 6 | 5 | 5 | 5½ | 3½ | 4 | 6½ | 5½ | | Interest rates average 3-month interbank | 14 | 12½ | 10 | 10 | 12 | 11 | 9½ | 12½ | 12 7/8 (3) | | Employment, per cent of working population including school leavers | 8½ | 10 | 11 | 11 | 11 | 11½ | 10½ | 8½ | 7½ | | Retailing index | 117 | 113½ | 105½ | 100½ | 100 | 91½ | 90 | 95½ | 97½ (3) |
(1) Provisional pre-Budget figures (2) At constant prices (3) February 6 ANNEX 2: DIRECT EFFECTS OF TAX CHANGES
A. Direct Taxes: Indexation
The RPI increased in the year to December 1988 by 6.8 per cent. With indexation by this amount and statutory rounding, the figures for the main allowances and other thresholds would be:
| Allowance | 1988-89 | 1989-90 | |----------------------------------|---------|---------| | Single and wife's earned income allowance | 2,605 | 2,785 | | Married allowance | 4,095 | 4,375 |
Tax rate bands
| Rate | 1988-89 | 1989-90 | |--------|---------|---------| | 25% rate | 19,300 | 20,700 | | 40% rate | over 19,300 | over 20,700 |
The total revenue cost of indexation of income tax (included in the forecast) is £1,455 million in 1989-90.
B. Indirect Taxes: Indexation
The effects of 6.8 per cent revalorisation of the excise duties (including VAT effects) are as follows:
| Product | VAT inclusive price change | Yield in 1989-90 £m | RPI impact % points | |------------------|---------------------------|----------------------|---------------------| | Beer | 1.5p/pint | 140 | 0.07 | | Wine | 6.0p/75cl light wine | 45 | 0.04 | | Spirits | 37.0p/bottle | 65 | 0.04 | | Tobacco | 6.5p/20 king size | 235 | 0.14 | | Petrol | 7.3p/gallon | 440 | 0.12 | | Derv | 6.1p/gallon | 95 | 0.01 | | VED | £6.80/car | 155 | 0.05 | | Overall effect, (including minor duties) | 1225 | 0.48(1) |
(1) Figures do not sum due to rounding
### C. Ready Reckoners: Illustrative Tax Changes
| | £ million | |----------------------|-----------| | **1989-90** | **1990-91**| | **INCOME TAX** | | | **Allowances and Thresholds** | | | 1% above indexation on all statutory allowances | 180 | 235 | | 1% above indexation on all statutory allowances and basic rate limit | 205 | 270 | | **Rates** | | | Change basic rate by 1p | 1,400 | 1,725 | | Change higher rate by 1p | 100 | 205 | | **CORPORATION TAX** | | | Change in main rate of 1 percentage point | 420 | 650 | | Change in small companies' rate of 1 percentage point | 30 | 50 | | **VALUE ADDED TAX** | | | Change in VAT rate of 1 percentage point(^{(1)}) | 1,300 | 1,830 |
(^{(1)}) A 1% change in the VAT rate would change the RPI by 0.45% ANNEX 3: PUBLIC FINANCES AND THE TAX BURDEN
Taxation, Expenditure and Borrowing
Since the Government first took office, total taxes and NICs have risen by 4 percentage points of GDP, though the ratio has fallen from its peak in 1981-82. This has enabled us to make net repayments of government debt in the last two years.
Table 1
Overall Taxation, Expenditure and Borrowing (percentage of GDP at market prices\*)
| Year | Non-North Sea Taxes plus NICs (as per cent of non-North Sea GDP) | Total Taxes plus NICs | General Government Expenditure (excluding privatisation proceeds) | PSBR | |---------|---------------------------------------------------------------|----------------------|-----------------------------------------------------------------|------| | 1978-79 | 34.2 | 33.9 | 43.3 | 5.3 | | 1979-80 | 35.1 | 35.1 | 43.5 | 4.8 | | 1980-81 | 36.2 | 36.3 | 46.1 | 5.3 | | 1981-82 | 38.7 | 39.3 | 46.6 | 3.3 | | 1982-83 | 38.1 | 38.9 | 46.8 | 3.1 | | 1983-84 | 37.7 | 38.5 | 45.9 | 3.2 | | 1984-85 | 37.8 | 39.1 | 46.2 | 3.1 | | 1985-86 | 37.1 | 38.5 | 44.5 | 1.6 | | 1986-87 | 37.8 | 38.1 | 43.7 | 0.9 | | 1987-88 | 37.6 | 37.9 | 41.6 | -0.9 |
[\*Treasury estimates for 1986-87 and 1987-88]
Personal Taxation
2. Despite reductions in income tax, total personal taxes (direct and indirect, including employees' NICs and domestic rates) in 1988-89 are over £30 billion higher in real terms (ie 1988-89 prices) than they were in 1978-79. For income tax and national insurance contributions the following table shows how the proportion of gross pay they represent rose up to 1981-82:
Table 2
| Year | ½ average earnings | average earnings | 2 average earnings | |----------|--------------------|------------------|--------------------| | 1978-79 | 16.0 | 27.8 | 31.4 | | 1981-82 | 20.8 | 29.3 | 32.2 | | 1982-83 | 20.8 | 29.8 | 32.3 | | 1983-84 | 20.1 | 29.6 | 31.7 | | 1984-85 | 19.3 | 29.2 | 31.5 | | 1985-86 | 18.9 | 29.0 | 31.5 | | 1986-87 | 18.9 | 28.5 | 30.9 | | 1987-88 | 19.1 | 27.6 | 29.9 | | 1988-89 (estimate) | 18.5 | 26.3 | 28.2 | | 1989-90 (indexation) | 18.6 | 26.3 | 28.3 |
\*Adult male earnings (all occupations). Married couple, wife not working: the couple are assumed to have no children, to avoid distortion of the figures from the abolition of child tax allowances.
3. These figures reflect the rise in the standard employees' NIC rate from 6½ per cent to 9 per cent. The lower rates introduced in the 1985 Finance Act do not affect the cases shown. So far as income tax is concerned, personal allowances have increased by about 25 per cent in real terms since 1978-79, slightly less than earnings. The basic rate has been reduced from 33p to 25p.
4. Average earnings have of course increased by substantially more than prices since 1978-79. So a married man on average earnings has seen his real take-home pay rise by £45 per week. The increase for a married man on half average earnings has been £22 per week, and on twice average earnings £94 per week.
5. As the table shows, indexation of allowances in the Budget, with no reduction in the basic rate, would lead to a very slight rise in the proportion of incomes taken in tax and NICs. This is because earnings are assumed to rise by more than the increase in tax thresholds, which is indexed to changes in prices.
Business Taxation
6. Following the sharp rise in corporation tax receipts over the past three years, as a result of the substantial recovery in company profits, total taxes paid by businesses (outside the North Sea) are now higher as a percentage of GDP than in 1978-79. Within this total, the major change has been a fall in employers' NICs (and NIS) as a "percentage of GDP, offset by increases in corporation tax, business rates and 'other' taxes as the following table shows:
Table 3
| Corporation Tax | Taxes on self employment incomes | Employers' NICs and NIS | Rates | Other | Total | |-----------------|---------------------------------|-------------------------|-------|-------|-------| | 1978-79 | 8.3 | 2.8 | 13.6 | 5.5 | 4.3 | 34.4 | | | (2.2) | (0.7) | (3.6) | (1.4) | (1.1) | (9.1) | | 1988-89 (estimate) | 15.9 | 3.7 | 13.0 | 8.1 | 7.4 | 48.1 | | | (3.4) | (0.8) | (2.7) | (1.7) | (1.6) | (10.2)|
1 Excludes North Sea, but includes ACT 2 VED, car tax, road fuel duty, duty on rebated oils, capital taxes The Prime Minister has now received all the reports from the Review bodies. They have recommended the following increases from 1 April 1989:
| Review Body | Pay bill increase | Range of increase | UK public expenditure Cost (1) £m | |--------------------------------------------------|-------------------|-------------------|-----------------------------------| | Armed Forces (APPRB) | 8.8 | 5-8 | 272 | | Doctors & dentists (DDR) | 8.8 | 8-14.1 | 312 | | Clinical academics (consequence of DDRB) | 10.8 | 8-13.6 | 8.5 | | Professions allied to medicine (PAM) | 7.7 | 7.6-7.8 | 43 | | Nursing staff, midwives and health visitors | 6.8 | 6.7-6.9 | 420 | | Top salaries (TSRB) | 6.5 | 4.9-10.6 | 6 |
(1) The figures for public expenditure cost differ from those in the review bodies' reports. Their figures do not include some costs which count as public expenditure.
(2) Includes £39m for practice expenses of family practitioners.
(3) These mainly represent across the board increases of 7.7% and 6.75%. Three Chief Area Nurses grade 4 in Scotland will get increases of 10-13.6%. All other nurses and midwives will get increases within the ranges shown.
(4) Includes £5m recommended for flexible pay experiments and £3m for new grading structure for educational grades, which the Review Body will be asked to price within the next few months. (5) Does not allow for recommendation to increase from 25% to 35% the quota of civil servants in Grades 2 and 3 eligible for discretionary increments. The figure for the pay bill increase does however allow for this. The figure given for the range of increases also excludes restructuring for 13 Immigration Adjudicators who receive increases of 27.1%, and for the Chief Immigration Adjudicator and the Vice-Presidents of the Immigration Appeal Tribunal, who get 28.3%.
TSRB report
2. The TSRB recommendations break down as follows:
i. a basic 5% increase for all groups;
ii. for the judiciary, some minor restructuring which would bring the pay bill increase to 5.2%;
iii. for senior officers in the armed forces, 2-star officers would be linked to the Grade 3 first performance point rather than the top of the Grade 3 scale, as at present. The pay bill increase for 2-star officers would be 10.5% and for senior officers as a whole 8.6%.
iv. for the civil service, structural changes to relate pay more closely to performance would be deferred but the quota of staff eligible for discretionary increments would rise from 25% to 35%. It is unlikely that the whole of the proposed increase in the quota would be taken up in the first year, but if it were, the additional cost in 1989-90 would be about £75,000, and about £150,000 in a full year which is about 1/2% of the pay bill for Grades 2 and 3. Otherwise, the only exception to the 5% basic increase would be the restoration of a London allowance for Grade 3s, at £2,000, a possibility to which the Government drew the TSRB's attention. The increase in the pay bill for Grade 3s would be 3.5% and for the whole group 8.2%.
DDRB report
3. The DDRB have recommended a basic 6% increase for all doctors and dentists in the NHS, with the following additions:
i. an increase of £1,000 in the top of the consultants' scale, thus raising it by 10.8%. All distinction awards (except the A+ awards - paragraph 3ii below) would as a result also increase by 10.8%, since their size is related to the consultant maximum. This recommendation would add £17m to the DDRB pay bill (£14.6m for the direct salary cost, £2.4m for the effect on distinction awards).
ii. an increase in the A+ distinction award from 95% to 100% of the consultant scale maximum. Consultants enjoying this award as well as the increase at the top of the scale would get 13.6%. The cost would be £0.3m;
iii. a small increase in the number of the higher distinction and meritorious service awards. The cost would be £1.7m; iv. an additional point at the top of the Senior House Officer Scale, recommended by both sides, and costing £0.8m. Those covered would get an increase of 14.18;
a reduction in the number of working hours at which junior hospital doctors qualify for increased on-call allowances. Since this is designed to encourage authorities to reduce the hours worked, it is recommended that it be treated as a nil cost item.
Pay and price movements elsewhere
4. The Review Bodies' recommendations compare with:
i. a year-on-year increase in underlying average earnings for the whole economy of 8.75% in November;
ii. an average level of settlements for the whole economy since the start of the pay round (covering 30% of employees) of 6.25%. In the private sector the figure is 6.5%;
iii a year-on-year increase in the RPI of 6.8% in December.
PROPOSALS
05. Ministers directly concerned have discussed what the response of the Government should be to the Review Body reports, taking account of views by the Secretary of State for Wales in a minute to the Prime Minister dated 13 February. They have reached the following conclusions and recommendations for consideration by the Cabinet.
06. The recommendations of the Review Bodies on the Armed Forces, Professions Allied to Medicine and Nurses and Nursing Staff, Midwives and Health Visitors should be accepted in full.
07. The recommendations of the Top Salaries Review Body should also be accepted in full, subject to one point. The Review Body recommended that the pay of 2-star officers should be linked to the first performance point for Grade 2 civil servants. Ministers consider that it would be wrong in principle to link pay which has no performance element to a performance point. On the other hand, they also thought that 2-star officers should receive a salary at about the level recommended by the TSRB, and that a link between the pay of senior officers and of civil servants must be retained. They came to the view that the pay of 2-star officers should be around 85% of the normally attainable maximum of Grade 2 civil servants (which is also the pay point for 3-star officers). This would give 2-star officers a salary at the level recommended by TSRB.
08. The recommendations by the Doctors and Dental Review Body should also be accepted, except for increases, in addition to the general 8% increase, at the top of the consultants' scale and in the size of consultants' distinction awards (paragraphs 3i and 3ii above). Ministers were of the view that these recommendations would produce big increases for consultants and that the Review Body's stated objective of improving the long-term career structure for hospital doctors would be achieved by the proposal in the White Paper, "Working for Patients", to create 100 additional, permanent consultant posts over the next 3 years. The recommendation to increase the number of distinction awards (paragraph 3iii above) should however be accepted.
09. As to financing, the cost of the awards by the Top Salaries Review Body and the Armed Forces Pay Review Body can be afforded within current provision. The awards for the NHS groups would involve a cost of £248m in excess of current provision, after allowing for the abatement for consultants described in paragraph 8. £62m of this is for the Family Practitioner Service, and falls on the Reserve. Of the £186m cost falling on the Hospital and Community Health Services, £44m would be met from within the NHS, with the remaining £142m coming from the Reserve. Last year the Government met the excess cost of the Review Body awards in full, and Ministers thought it important to establish the principle that this would not necessarily happen every year.
10. The cost of clinical academics is kept in line with that of DDRB groups but falls on the DES. The cost in excess of provision, after allowing for the abatement for consultants, would be £2.8m, which would be met from the Reserve.
11. There is no Parliamentary process for the Review Body reports, except that an Order is necessary to maintain the differential between the Lord Chancellor's salary and the Lord Chief Justice's, in accordance with declared Government policy. This requires an Affirmative Resolution in both Houses of Parliament and has in the past created an opportunity for debate on the whole TSRB report. Ministers thought that the Government should use the opportunity of next Session's Bill on Parliamentary pensions to remove this requirement.
Teachers' Pay
12. The Secretary of State for Education and Science has received the report of the Interim Advisory Committee on School Teachers' Pay and Conditions (IAC). They recommend increases for school teachers in England and Wales from 1 April 1989 that would add 6.3% to the pay bill. The main recommendations are for:
i. a 6% increase in the Main Professional Grade from 1 April 1989.
ii. a 7% increase in the value of incentive allowances from 1 April 1989.
iii. a 7.5% increase in the spot salaries of heads and deputies from 1 April 1989.
iv. a 5.6% uplift in London Weighting from 1 July 1988.
vi. an additional 9,500 incentive allowances in 1989-90.
Ministers were of the view that the IAC recommendations should be accepted, but that the Government should not pay local authorities extra grant to finance them.
Announcement
13. Ministers consider that there is a strong case for announcing the Government's decisions quickly. Decisions on Review Body Reports have generally been announced by way of a Written Answer to an arranged Parliamentary Question. Arrangements have been made to put down a Written Question for answer tomorrow, Thursday 16 February. If the Cabinet approve the proposals described in this note, the Prime Minister will announce the decisions in an Answer on the lines of the draft attached at Annex A, which will become public at 4pm tomorrow afternoon. At the same time, the Secretary of State for Education will announce the decisions on the IAC report by way of another written Answer, of which a draft is at Annex B.
ROBIN BUTLER
Cabinet Office 15 February 1989 The 1989 reports of the Review Bodies on the pay of Nursing Staff, Midwives and Health Visitors, and Professions Allied to Medicine, the Doctors and Dentists, and the Armed Forces, and of the Top Salaries Review Body, have been published today. Copies are now available in the Vote Office. The Government are grateful to members of the review bodies for these reports and the time and care which they have put into their preparation.
The following table shows the increases in pay rates recommended by the review bodies, and their cost:
| Review Body reports | Pay bill increase, per cent. | Range of increase, per cent. | UK Public Expenditure Cost (£ Million) | |--------------------------------------|------------------------------|------------------------------|---------------------------------------| | Armed Forces | 6.8 | 5-8 | 272 | | Doctors and dentists | 8.8 | 8-14.1 | 312 | | Professions allied to medicine | 7.7 | 7.6-7.8 | 43 | | Nursing staff, midwives and health visitors | 6.8 | 6.7-6.9 | 420 | | Top salaries | 6.5 | 4.9-10.6 | 6 |
(1) The figures for public expenditure cost differ from those in the review bodies' reports. Their figures do not include some costs which count as public expenditure. The figure for doctors and dentists includes payments for GPs' expenses, not counted as pay. The figure for nurses includes £5m for the flexible pay experiment and an estimated £3 million for a new grading structure for educational grades, which the Review Body has not yet costed.
(2) Three Chief Area Nurses grade 4 in Scotland will get increases of 10-13.6%.
(3) This figure does not allow for the recommendation to increase from 25% to 35% the quota of civil servants in Grades 2 and 3 eligible for discretionary increments. The figure for the pay bill increase does however allow for this. The figure given for the range of increases also excludes restructuring for 13 Immigration Adjudicators who receive increases of 27.1%, and for the Chief Immigration Adjudicator and the Vice-Presidents of the Immigration Appeal Tribunal, who get 28.3%. The Government have decided to accept in full the Review bodies' recommendations on the armed forces, on professions allied to medicine, and on nursing staff, midwives and health visitors.
The Government have also decided to accept the recommendation of the review body on doctors and dentists for a basic increase of 8% for all the groups covered. In the Government's view the creation of 100 additional permanent consultant posts over the next 3 years, as proposed in the White Paper, "Working for Patients", will best achieve the objective of improving the long-term career structure for hospital doctors. The creation of these posts will therefore take the place of the increases recommended, in addition to the 8% basic increase, at the top of the consultants' scale and in the size of consultants' distinction awards. Subject to this, the Government accepts the Review Body's recommendations.
The Government have decided to accept the recommendations of the Top Salaries Review Body in full, except that they consider that the pay of 2-star officers should be around 85% of the normally attainable maximum of Grade 2 civil servants (which is also the pay point for 3-star officers) rather than linked to a performance point for Grade 3 civil servants. This would give the 2-star officer a salary at the level recommended by the TSRB.
The full cost of the awards by the Armed Forces Pay Review Body and Top Salaries Review Body groups will be met from within existing public expenditure programme totals for this year. In the case of the health services however the Government recognise that the full costs could not be accommodated without adversely affecting services to patients. The Government have therefore decided to provide an extra £142m for health authority cash limits from the Reserve for next year. Of the remaining cost, £417m is already fully covered within the allocations made for this year, leaving a balance of £44m to be covered from cost improvements. The Government have similarly decided to provide an additional £62m to the Family Practitioner Services from the Reserve for this year. Together with the increases in allocation already announced, the increase in provision for the National Health Service in 1989-90 over 1988-89 will therefore be £1899m.
The pay rates and scales resulting from the decisions will be promulgated as soon as possible for all the groups concerned. DRAFT PQ ON IAC REPORT ANNOUNCEMENT
Question: To ask the Secretary of State for Education and Science, when the second Report of the Interim Advisory Committee on School Teachers' Pay and Conditions will be published.
Answer:
MR KENNETH BAKER
It is being published today. Its main recommendations are
- a 6% increase in the main pay scale for teachers from 1 April 1989
- a 7% increase in the value of the five rates of incentive allowances from 1 April 1989
- a 7.5% increase in the salaries of the 55,000 Heads and Deputies from 1 April 1989
- an extra 9,500 incentive allowances for the 1989-90 academic year, on top of the additional 18,000 already planned
- a 5.6% increase in London allowances from 1 July 1988.
I propose to accept the Committee's recommendations in full. I am today initiating the consultation required by Section 3(1) of the Teachers' Pay and Conditions Act 1987 by writing to the relevant local authority associations, teacher unions and bodies representing the interests of the governors of voluntary schools, setting out my proposals. The text of the letter is as follows:
[text of consultation letter] LETTER FROM THE SECRETARY OF STATE FOR EDUCATION AND SCIENCE TO THE RELEVANT LOCAL AUTHORITY ASSOCIATIONS, TEACHER UNIONS AND BODIES REPRESENTING THE INTERESTS OF THE GOVERNORS OF VOLUNTARY SCHOOLS
TEACHERS PAY AND CONDITIONS OF EMPLOYMENT
1. On 14 September 1988 I asked the Interim Advisory Committee on School Teachers Pay and Conditions to examine and report to me on certain issues. I enclose a copy of the Committee's report which is being published today. The Committee's recommendations are summarised in Chapter 9 of its report. I propose to make an Order giving effect to the recommendations referred to in paragraphs 2 - 3 below. But before I take a decision on what provision the order should make, I invite your views. This letter therefore initiates the consultation required by Section 3(1) of the Teachers' Pay and Conditions Act 1987.
2. I propose to accept the Committee's recommendations that
i. the salaries of all qualified teachers should be raised by a uniform 6% to the figures set out in paragraph 4.13 of the Committee's report with effect from 1 April 1989;
ii. the salaries of unqualified teachers should be raised by the same percentage, (paragraph 4.13). The allowance for teachers of the visually impaired and hearing impaired would also be increased by 6%;
iii. the spot salaries for Heads and Deputies should be increased by 7.5% with effect from 1 April 1989, (paragraph 4.21);
iv. the rates of the London area allowances should be increased by 5.6% with effect from 1 July 1988, (paragraph 5.16); v. the value of each of the incentive allowances should be increased by 7% with effect from 1 April 1989, (paragraph 4.34);
vi. the planned number of incentive allowances should be expanded from September 1989 by 9,500 (5,000 extra A allowances; 2,500 B allowances; 1,500 C allowances and 500 D allowances): (paragraphs 4.31 and 4.32). There will need to be some consequential revisions to the limits relating to incentive allowances in Annex A to Appendix I of the School Teachers Pay and Conditions Document 1988, (paragraph 4.33).
3. The Committee makes a number of other recommendations which would require amendments to the School Teachers' Pay and Conditions Document 1988 (the 1988 Document):
a. that teachers returning to regular full-time or part-time teaching should be paid on re-entry at no lower point on the mainscale than when last employed as a regular full-time or part-time teacher (paragraph 5.21)
b. that, contingent upon the introduction of the proposed licensed teacher arrangements, there should be discretion for local authorities or governors, as appropriate, to pay licensed teachers at either qualified or unqualified rates (paragraph 5.26)
c. that local authorities (and, at the appropriate point, governors of schools with delegated budgets) should be given discretion to accelerate a teacher's progression to the top of the mainscale (paragraph 5.29)
d. that once the necessary regulations under Section 218 of the Education Reform Act have been made, a teacher who is awarded Qualified Teacher Status (QTS) retrospectively should be entitled to receive back pay from any authority he/she has worked for from the date from which his/her qualification runs, to make good any difference between what he/she was actually paid up to the point when QTS was awarded and what he/she would have been entitled to as a qualified teacher (paragraph 5.41)
e. that the discretions over pay and conditions currently exercised by local education authorities set out in Appendix I of the report should be transferred to governing bodies of schools with budgets delegated under Chapter III of Part I of the Education Reform Act 1988 (paragraph 7.24) and that the decision on whether it is "reasonably practicable to provide a supply teacher" should transfer to the governors in those schools where the governing body have been made responsible, under the relevant LMS scheme, for managing the arrangements for providing supply teachers (paragraph 7.26)
f. that the functions, both mandatory and discretionary, currently allocated to LEAs under the 1988 Document should be allocated to governing bodies of grant maintained (GM) schools (paragraph 7.28)
g. that where a GM school was formerly a voluntary school, a head teacher should carry out his/her professional duties in accordance with any trust deed applying to the school (paragraph 7.29)
h. that salary safeguarding on a discretionary basis and discretionary safeguarding on London allowance and social priority allowance should apply in both directions between a GM school and its former maintaining authority (paragraph 7.31)
i. that the provision in relation to cover at sub paragraph 35(9)(b)(ii) of the 1988 Document should be amended in the direction of wording suggested by the Professional Association of Teachers (paragraph 8.9)
j. that the reference to payment for midday supervision at paragraph 23 of the 1988 Document should be deleted (paragraph 8.14)
k. that the reference to education legislation in the "overriding requirements" section of head teachers conditions of employment - paragraph 27(i) of the 1988 Document - should be updated to include the Education Reform Act 1988 (paragraph 8.24)
l. that specific reference should be made in both head teachers and schoolteachers conditions of service to the Basic (including National) Curriculum, and, in the case of head teachers, to the collective worship requirements of the Education Reform Act (paragraph 8.25)
I propose to accept all these recommendations.
4. The Order I propose to make to give effect to all of the above would do so by bringing into effect a new School Teachers' Pay and Conditions Document. The Committee's remaining recommendations do not require changes to the 1988 Document: I do not therefore propose to change the document in response to those recommendations. Nor is it intended to revise the RSG settlements for 1989-90 on account of the proposals set out in paragraphs 2 and 3 above. The cost will be offset in part by the greater than expected reduction in the employers' contributions to the Teachers Superannuation Scheme which I announced on 10 February.
5. Any comments on the proposals set out above and on any other matters raised in the report are invited by 10 March. If you would like to express your views in a meeting would you let my office know of this as soon as possible so that any meetings can take place before Easter.
6. Following these consultations a new School Teachers' Pay and Conditions Document will be prepared. There will then be opportunity to comment on the precise wording of the amendments prior to the publication of the new Document and the laying before Parliament of an Order which will give effect to its provisions.
7. The Interim Advisory Committee say that they hope it will be possible for a copy of the report to be seen by teachers in every maintained school. Enough copies of the report are being sent to each local education authority for a copy to be circulated in each school. BACKGROUND AND PROPOSED PROGRAMME
As the Cabinet recognised a year ago (CC(88) 9th Meeting), the present session's programme is at the limits of what can be managed, and this very heavy programme is bound to have a knock-on effect on the starting date for the next session. It is essential, however, that we plan for the fourth (1990-91) session of this Parliament to begin at the conventional time. Next session's programme must be constructed with both these pressures in mind. We must also recognise that there are some necessary Bills which would not be suitable for a fourth or fifth session of the Parliament and which therefore have a strong claim on next session's programme. Equally, there are other Bills that would be perfectly suitable for the later session and could be deferred with that in mind.
2. Taking all these considerations into account, The Queen's Speech and Future Legislation Committee (QL) has been through the usual process of consultation with colleagues and now proposes the programme set out at Annex A. The main elements of the proposed programme, which has a very different character from those of recent years, are the Broadcasting Bill, the Courts and Legal Services Bill, the Human Rights Bill, the Environmental Protection Bill, the Health Services Bill, and the Human Fertilisation and Embryology (Control) Bill. The programme contains several Bills which would be controversial and will consume a good deal of time in both Houses. One particular difficulty is that amendments to the abortion law are likely to be within the scope of the Human Fertilisation and Embryology (Control) Bill, and this is bound to complicate the Bill's passage.
3. The programme which QL recommend is again at the limits of what can be delivered in the session, and there is no contingency margin for unforeseeable extras. Once again I must ask colleagues to accept that any significant additions to the programme would need to be offset by matching reductions. BILLS NOT RECOMMENDED FOR INCLUSION
4. A list of the Bills which QL decided not to include in the recommended programme is at Annex B. As usual, the list contains a number of attractive bids, and I particularly draw the Cabinet's attention to the arguments which were put to QL in favour of the following:
(a) Town and Country Planning Bill
This Bill would provide for changes to land compensation arrangements, which would be of help in connection with major infrastructure projects such as the channel tunnel rail link; changes to development plans, which were the subject of a White Paper published last month; charging for appeals, which should help to reduce the backlog of planning applications and appeals; and, subject to colleagues' policy agreement, measures on planning enforcement, which is a subject on which there is widespread public concern. There is clearly a strong case for proceeding quickly with this Bill, but planning law is a politically lively issue and, although the Bill would probably be no more than 30-40 clauses, it would undoubtedly take up a good deal of Parliamentary time.
(b) Open Markets Bill
The Secretary of State for Trade and Industry has indicated that, in order to assist QL, he would be prepared to trim this to a Bill containing 50 clauses on restrictive trade practices and, if there was room, a further 30-40 clauses on consumer credit. Both the Secretary of State for Trade and Industry and the Chancellor of the Exchequer emphasised that legislation on restrictive trade practices is an important element of the Government's policy of increasing competition and promoting enterprise. The policy proposals were set out in a Green Paper published last year. Provided that the Bill were introduced next session it could provide a very helpful background for the Lord Chancellor's Bill on the reform of legal services, and the corresponding Scottish measure. Legislation on consumer credit, which is also of a deregulatory nature, would be welcome in view of current concerns about credit practices.
(c) Road Traffic Bill
The Secretary of State for Transport has indicated that he would be prepared to trim this Bill to a 70 clause measure to implement the North Review of Road Traffic Law, together with some miscellaneous amendments to the Road Traffic Act. The White Paper setting out the Government's response to the North Review, which was published last month, has been extremely well received. The reform of road traffic law is widely seen to be overdue and legislation would be welcomed on all sides. The Secretary of State for Transport is concerned that the Government would be criticised for delay and would lose the initiative if legislation were not brought in at the first opportunity. We might also be faced with a number of Private Members' Bills next session, seeking to legislate on elements of our own White Paper proposals. In each of these cases, QL recognised that there were powerful arguments for proceeding in the 1989-90 Session, but were simply unable to find room in the programme. QL considered that all three Bills would be suitable for a fourth Session.
PREPARATION AND HANDLING OF BILLS
As usual, I must invite colleagues to take a particular interest in ensuring the timely preparation of Bills for which they are responsible. I appreciate the great efforts that were made to have most of our major Bills ready at the beginning of the present session, and it is essential that we repeat that performance this year as it provides the foundation for managing the whole session's business. The management of the programme also depends on a reasonable number of weighty Bills being introduced in the House of Lords. The Lord Privy Seal and I will once again be looking to colleagues to cooperate with us in making the necessary choices.
CONCLUSION
6. I invite the House:
(a) to approve the list of Bills at Annex A as the provisional legislative programme for next session, on which preparatory work should now be put in hand;
(b) to endorse the comments in paragraph 5 above about the preparation and handling of Bills.
J W
Privy Council Office
7 March 1989 ANNEX A
BILLS RECOMMENDED FOR INCLUSION IN 1989/90 PROGRAMME
ESSENTIAL
DTp Civil Aviation Authority (Borrowing Limits) very short
To increase the ceiling on aggregate borrowing by the Civil Aviation Authority.
CONTINGENT
DEN Coal Industry short
To increase the statutory limit on restructuring grants payable to the British Coal Corporation (BCC) and/or to change BCC's capital.
FCO Fiji short
To make provision consequent upon Fiji's possible departure from the Commonwealth.
FCO Pakistan short
To make provision consequent upon Pakistan's possible readmission to the Commonwealth.
PROGRAMME WITH ESSENTIAL ELEMENTS
HO Broadcasting long (150-200 clauses)
To implement the broadcasting White Paper (including reorganization of independent television (essential)); to reform commercial radio; to strengthen provisions on broadcasting standards; and miscellaneous other measures.
LCD Courts and Legal Services long (c 70 clauses)
To make reforms in the organisation of the legal professions and in the civil justice system; to bring judicial pensions into line with the requirements of the Social Security Acts 1985 and 1986 (essential); and miscellaneous other measures. HMT Pensions (Miscellaneous Provisions) short
To provide for pensions increase for widowers in accordance with EC requirements (essential); and to score the cost of pensions increase in teachers' and NHS' notional funds.
PROGRAMME
MAFF Food long (c 100 clauses)
To replace the Food Acts for England and Wales and for Scotland with a comprehensive and modernized GB Act.
DES Teachers' Pay and Conditions short
To establish a permanent statutory framework for determining teachers' pay.
DES Student Support short
To establish the Secretary of State's powers to secure the provision of loans to students in higher education in England, Wales and Scotland.
DEmp Employment (excluding tourism provisions) medium
To make further reforms of trade union law; and to abolish the Wages Council system.
DOE Environmental Protection long (c 100 clauses)
To provide for various improvements in environmental protection legislation including the introduction of an integrated system of control over industrial pollution and reform of the law on waste disposal.
DOE Crown Suppliers very short
To facilitate the privatisation of the Crown Suppliers.
DH Health Services long
To implement the White Paper on the reform of the National Health Service. DH Human Fertilisation and Embryology (Control) substantial (40-50 clauses)
To implement the White Paper on Human Fertilisation and Embryology arising in part from the Warnock Report.
HO Mutual Assistance substantial
To enable the UK to join in international arrangements for mutual legal assistance.
HO Representation of the People short
To reform the law on voting for British citizens resident overseas; and to simplify the law on absent voting for those who move house.
SO Scottish Enterprise and New Towns (Scotland) long
To establish Scottish Enterprise to replace the Scottish Development Agency and the Training Agency in Scotland; to provide powers to reconstruct development corporations' liabilities; and to extend powers for winding up development corporations.
SO Law Reform (Miscellaneous Provisions) (Scotland) long (c 50 clauses)
To reform restrictive practices in the legal professions in Scotland; and to make miscellaneous improvements to Scottish administration of justice and criminal law.
DSS Social Security substantial (c 30 clauses)
To make further reforms to social security legislation.
DTI Export Credit and Investment Guarantees medium (c 15 clauses)
To enable the Export Credit Guarantees Department to take advantage of capital market developments.
DTp Highways and Transport (Private Finance) substantial (excluding non-highways provisions)
To establish new procedures for authorising privately financed roads; and to amend the Highways Act and the Public Utilities Street Works Act. DTp Aviation and Marine Security short To provide for prosecution or extradition in respect of terrorist acts against ships, offshore platforms and at airports; and to tighten powers relating to airport, ferry and port security.
HMT Government Trading Funds short To widen powers for Next Steps Agencies to be taken out of the Vote accounting system.
HMT Parliamentary Pensions short To introduce new pensions arrangements for the Prime Minister, Speaker and Lord Chancellor; and to provide for severance pay for House of Commons Ministers.
UNCONTROVERSIAL
MOD Greenwich Hospital very short To remove constraints on the admission of pupils to the Royal Hospital School.
FCO Protocols Additional to the Geneva Conventions very short To enable the UK to ratify additional protocols to the Geneva Conventions.
LCD Contracts medium To enable the UK to ratify the 1980 Rome Convention on the law on contractual relations. ANNEX B
BILLS NOT RECOMMENDED FOR INCLUSION IN 1989/90 PROGRAMME
PROGRAMME
MAFF Agricultural Marketing short To abolish the potato and wool price support regimes and possibly to amend the potato marketing scheme.
MAFF Slaughterhouses medium To extend the Slaughterhouses Act 1974 to farmed deer and rabbits; to strengthen welfare controls on slaughtering; and to provide for recovery of Government costs for inspecting pig slaughterhouses.
MAFF Agriculture Capital Grants (Expenditure Management) very short To facilitate transfer of provision for farm capital grants to a cash limited Vote.
MAFF Forestry very short To increase the maximum membership of forestry regional advisory committees.
MOD Defence Research Agency short To facilitate possible formation of MOD's research establishments into a Government owned plc.
DE Employment (tourism provisions only) very short To reorganize arrangements for promoting tourism.
DES Research Councils Reorganisation short To merge various Research Councils.
DOE Town and Country Planning substantial (30-40 clauses) To provide for changes to land compensation arrangements; reform of development plan system; charging for appeals; and measures on planning enforcement. DOE Commons
To provide for more effective management of, and improved access to, common land.
FCO Diplomatic and Consular Premises (Disturbances)
To control demonstrations which disturb Embassies and Consulates.
FCO China Indemnity (Application)
To wind up the affairs of the Chinese Government Purchasing Commission and to provide for the application of its remaining funds.
DH Registration Services
To modernise Registration Service procedures.
HO Criminal Justice (except mutual assistance provisions)
To make improved provision for punishment in the community; to reform the law on parole; to withdraw the right to jury trial for minor theft; to reform the law on the right of silence; and to make provision for private sector involvement in the remand system.
HO Summer Time
To coordinate time with other EC countries and allow more summer time in the UK.
HO Shops
To relax restrictions on Sunday trading.
LCD Commonhold and Land Obligations
To facilitate the transfer and management of interdependent properties.
OAL Museums and Galleries
To regularise the funding status of National Museums and Galleries; to grant corporate status to the trustees of certain galleries and to enable them to dispose of objects in their collections. DTI Open Markets long (c 110 clauses)
To reform the law on restrictive practices; consumer credit; weights and measures; the sale and supply of goods; and statistics of trade.
DTI Privatisation substantial (Miscellaneous Provisions) (30-40 clauses)
To facilitate the privatisation of the National Engineering Laboratory and the British Technology Group; and to reorganise British Shipbuilders into a residuary body.
DTP Road Traffic long (c 130 clauses)
To reform road traffic legislation in the light of the North Review; to make miscellaneous other reforms to traffic law; and to ease statutory requirements on operators of goods vehicles.
DTP Highways and Transport substantial Private Finance (non-highways provisions)
To compel local authorities to privatise their bus companies and to complete the conversion of the ports to a private sector industry.
UNCONTROVERSIAL
LCD Civil Jurisdiction and Judgements medium
To give effect to the Lugano Convention on civil jurisdiction and the recognition and enforcement of judgements.
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2b9e8f4f253f36b19769e07673a9c7516045a2b1 | C.P. (5) 226 - Railway Man-Power and Winter Coal Supplies: Memorandum by the Minister of Fuel and Power.
227 - Situation in the South African High Commission Territories: Memorandum by the Secretary of State for Commonwealth Relations.
228 - Leasehold Reform: Memorandum by the Lord Chancellor.
229 - The Death Penalty under the Naval Discipline Act: Memorandum by the First Lord of the Admiralty.
230 - The European Defence Effort and European Integration Schemes: Memorandum by the Secretary of State for Foreign Affairs.
231 - Future of the British Council: Memorandum by the Secretaries of State for Foreign Affairs, Colonies and Commonwealth Relations.
232 - Report of Broadcasting Committee: Memorandum by the Secretary of State for Commonwealth Relations and the Postmaster-General.
233 - German Contribution to Western Defence: Memorandum by Foreign Secretary and Minister of Defence.
234 - Japanese Peace Treaty: Japanese Shipbuilding Capacity: Memorandum by the Secretary of State for Foreign Affairs.
235 - German Debt Settlement: Memorandum by the Secretary of State for Foreign Affairs.
236 - Council of Europe: Memorandum by the Secretary of State for Foreign Affairs.
237 - The Man-Power Position on the British Railways: Memorandum by the Minister of Transport.
238 - German Defence Contribution: Economic and Financial Implications: Note by the Prime Minister.
239 - Washington and Ottawa Meetings: Review of British Policy: Memorandum by the Prime Minister.
240 - Germany: Memorandum by the Prime Minister.
241 - Persia: Sterling Control Order: Memorandum by the Chancellor of the Exchequer.
242 - The Balance of Payments Position: Memorandum by the Chancellor of the Exchequer.
243 - Supplies of Finished Military Equipment from the United States: Memorandum by the Minister of Defence.
244 - Legal Consequences of Egyptian Abrogation of the 1936 Treaty: Memorandum by the Secretary of State for Foreign Affairs.
245 - Long Term Financial Prospects of the British Transport Commission: Memorandum by Minister of Transport.
246 - The Coal Transport Situation: Memorandum by the Minister of Fuel and Power.
247 - The Manning of the Civil Defence Corps and Fire Service: Memorandum by the Home Secretary and the Secretary of State for Scotland.
248 - Man-Power Requirements of the Police at the Outset of any major war: Memorandum by the Home Secretary and the Secretary of State for Scotland. C.P. (51) 249 - The Man-Power Position on the British Railways: Memorandum by the Minister of Labour and National Service.
250 - Bamangwato Affairs: Tshokedi Khama: Memorandum by the Parliamentary Under-Secretary of State for Commonwealth Relations.
251 - Report on Discussions in Washington and Ottawa on Balance of Payments and Defence Questions: Memorandum by the Chancellor of the Exchequer.
252 - The King's Speech on the Prorogation of Parliament: Memorandum by the Home Secretary.
253 - Agricultural Wages and Prices: Memorandum by the Minister of Agriculture and Fisheries.
254 - Locomotive Contract for Persia: Memorandum by the President of the Board of Trade.
255 - Man-power for the Mines: Memorandum by the Minister of Fuel and Power.
256 - Press Articles and Interviews by Ministers: Note by the Prime Minister.
257 - The Oil Dispute with Persia: Memorandum by the Secretary of State for Foreign Affairs.
258 - Use of Official Transport Facilities during the General Election: Note by the Prime Minister.
259 - The King's Speech on the Prorogation of Parliament: Memorandum by the Prime Minister.
260 - Future of the South Bank Site: Memorandum by the Lord Privy Seal.
261 - General Election: Enquiries by Candidates: Note by the Prime Minister.
262 - Man-Power: Measures to deal with Labour Supply: Memorandum by the Minister of Labour and National Service.
263 - Treaty of Alliance with Libya: Memorandum by the Secretary of State for Foreign Affairs.
264 - Continuance of the Festival Pleasure Gardens: Memorandum by the Lord Privy Seal.
265 - Closer Association in Central Africa: Memorandum by the Secretary of State for the Colonies and the Secretary of State for Commonwealth Relations.
266 - Bilateral and Tripartite Talks in Washington and Atlantic Council Meeting in Ottawa: 10th-20th September, 1951: Memorandum by the Secretary of State for Foreign Affairs, the Chancellor of the Exchequer and the Minister of Defence.
267 - Custody of Cabinet Documents: Note by the Prime Minister. RAILWAY MAN-POWER AND WINTER COAL SUPPLIES
Memorandum by the Minister of Fuel and Power
From the point of view of our coal supplies next winter, I desire to give my strongest support to the proposals, submitted by the Minister of Transport in C.P. (51) 215, for strengthening railway man-power. I feel bound to do this not only by reason of the great anxiety which I myself feel on this subject but also in the light of the urgent representations which I have received from the Coal Industry National Consultative Council which embraces both the National Coal Board and the National Union of Mineworkers.
2. The experience of last winter showed clearly that the volume of coal traffic then handled represented the maximum which the railways were capable of coping with, while the expected increase in production next winter is much greater (2-4 million tons as compared with 1 million tons) than the imports which had to be handled last winter. Moreover, it is not even as though the railway situation to-day is as good as it was a year ago, for this summer the situation on the railways is such that the Railway Executive has had to put embargoes on the movement of coal trains, a step which in a summer period is unprecedented in living memory.
3. The present outlook is therefore one of exceptional gravity, for not only are we likely to have a deficit this summer of 1.25 million tons of large coal, but we are faced also with the risk that next winter our difficulties will be still further aggravated through the railways being unable to move even the whole of the coal which we hope to produce.
4. Such a development would be most serious from two points of view. First, if the railways cannot clear the coal from the pits, stoppage of production and unemployment of miners will be inevitable and total supplies will be even less than we expect. Second, if the railways are unable to move coal to the points where it is required, we shall be prevented from giving assistance in those areas which will be most short of supplies. This will fall with especial force upon house coal for the domestic consumer, which, in addition to being very seriously inadequate in quantity, will also be unevenly distributed over different parts of the country. In particular, the problem of supplying London with house coal will become very acute. Already, indeed, the stocks of house coal in the London area are the worst on record for this time of year (101,000 tons as compared with 176,000 tons in 1950, and 325,000 tons in 1948 and 1949).
5. I accordingly ask my colleagues to give full weight to the importance of doing everything possible to increase railway man-power, and thus to mitigate so far as possible the extremely serious house coal problem which will inevitably face us next winter.
P. J. N-B.
Ministry of Fuel and Power, S. W. 1.,
24TH JULY, 1951. SITUATION IN THE SOUTH AFRICAN HIGH COMMISSION TERRITORIES
MEMORANDUM BY THE SECRETARY OF STATE FOR COMMONWEALTH RELATIONS
The High Commissioner (Sir Evelyn Baring) has reported a conversation which he has had with an entirely trustworthy person who recently saw Dr. Malan in Pretoria on the latter's return from holiday during the Parliamentary Recess. The High Commissioner's informant said that Dr. Malan at once referred to the position of the High Commission Territories. Dr. Malan said that it looked as if the United Kingdom Government might give way in the Bechuanaland Protectorate (i.e., allow Seretse Khama to return) and that if this happened the consequences would be deplorable. He would have to take very early action. He would have recourse to economic measures. He thought that, if he "put on the screw hard" to force transfer, he would have a united South Africa behind him.
2. The High Commissioner asked his informant whether, in the latter's opinion, the Union Government would actually blockade the Territories if Seretse were recognised. The informant gave it as his opinion that they probably would. They might themselves suffer damage; but the Nationalist Government had already shown itself ready on occasion to cut off its nose to spite its face. An example of impatient action against its own interests was the ban hastily imposed on the admission of "foreign" (i.e., non-Union) natives to Union post-primary schools.
3. The High Commissioner then asked his informant whether he thought Union opinion on the recognition of Seretse was stronger or weaker than it had been early in 1950. The reply was that he thought it much stronger, partly on account of developments in the Gold Coast but still more because recognition of Seretse now would involve the reversal of a previous decision and would appear to be a surrender in face of a combination of political pressure in the United Kingdom and violence in the Protectorate, both engineered by Africans.
4. The High Commissioner's informant said in conclusion that the Union Government were bound to press very hard next year for transfer of the Territories. Resistance would be difficult for us anyhow; it would become hopeless if Seretse were recognised.
5. As I have said, Sir Evelyn Baring's informant is entirely trustworthy. I am satisfied that what he said reflects what is in Dr. Malan's mind. I think it important, therefore, that my colleagues should be aware of it; but we must, of course, be extremely careful not to compromise our source by making any disclosure of what we know from him.
6. It is worth adding that Mr. Paver, who is head of the South African Bantu Press, recently volunteered in conversation with a member of my staff views very much on the lines of those outlined above. Paver's assessments of South African opinion, European or African, are usually pretty accurate. He said that his impression was that recognition of Seretse now would probably be resented even more in the Union than a year ago. Against the background of the Gold Coast developments the Nationalist Government would get a lot of support even from English-speaking South Africans for any action it took vis-à-vis the Protectorates.
7. I have also heard that the United States Chargé d'Affaires in Pretoria is reporting to the same effect.
P. C. G. W. CONFIDENTIAL C.P.(51) 228 COPY NO. 31 25TH JULY, 1951 CABINET
LEASEHOLD REFORM
Memorandum by the Lord Chancellor
On the Prime Minister's directions, I arranged for a preliminary discussion, by the Ministers most closely concerned, of the Attorney-General's memorandum on Leasehold Reform (C.P.(51) 205).
Security of Tenure
2. The Attorney-General's memorandum refers to various proposals for giving a statutory security of tenure to residential tenants who are not at present covered by the Rent Acts. These proposals are as follows:
Houses of "Rent Act" Size
(a) An occupying ground lessee of a house, however small, is not now protected on expiry of his ground lease if (as is usually the case) the ground rent is less than two-thirds of the rateable value. This should be reversed so as to give ground lessees the same protection under the Rent Acts as rack-rent tenants.
(b) Sub-tenants who hold from ground lessees and are at present protected by the Rent Acts should continue to be so protected (as against the head landlord) after the expiry of the intermediate ground lease. (This would restore the law to what it was thought to be before a recent decision of the Court of Appeal.)
Bigger Houses
(c) There should be a prima facie right to a renewal of tenancy for all occupying tenants of unfurnished residential property too big to attract the Rent Acts code, whether they are ground lessees or hold on ordinary occupational tenancies of whatever length. The right would have to be subject to a fairly wide list of "just exceptions". The rent would be a fair market rent, fixed, in default of agreement, by a Tribunal, and the period and other terms of the lease would also be subject to the Tribunal. There are many details which would have to be further worked out.
3. These proposals, if implemented, would represent a very considerable social reform, and we felt they ought to be approved in principle.
Leasehold Enfranchisement
4. The question then arises whether we should confine ourselves to protecting and prolonging the tenant's right of occupation, or whether we should go further and give him also the right to acquire compulsorily the proprietorship of his house, which he can then use either for occupation or, if he prefers, for purposes of resale or of letting at a rack rent.
5. There was general agreement at our meeting (a) that, if there is to be a scheme of leasehold enfranchisement, it must be limited to occupying ground lessees of residential property and should not be extended to rack-rent tenants under ordinary occupational tenancies (normally for 3, 5, 7 or 14 years); (b) that the only practicable scheme for fixing the price which the tenant should pay on exercising his right to enfranchise his lease was one which assumed the enactment of the proposals, outlined above, which give the tenant security of tenure on the natural expiry of the lease. The market value of a reversion appreciates very steeply towards the end of the term, because of the prospect of reversion to vacant possession. If we gave the tenant the right to enfranchise on payment of the market value of the reversion, the right would be too costly to be of any use to him. But the effect of the above proposals would be to diminish very considerably the market value of the reversion, because the reversion would be subject to the presence of a sitting tenant at a controlled rent.
6. On the general merits of enfranchisement, some of us were inclined to think that, if security of tenure were granted, little case would be left on social grounds for adding a right of leasehold enfranchisement, with its inevitable complications. On the other hand, some of us felt that there would be grave disappointment on political grounds if our permanent legislation on leasehold reform did not include some right, however restricted, to leasehold enfranchisement.
7. On the whole, we felt that the Cabinet might find it expedient, without committing themselves now to the principle of leasehold enfranchisement, to direct that a scheme should be worked out on a provisional basis in order that Ministers might judge, in the light of difficulties thrown up in detailed consideration, whether such a measure would be worth while.
8. If leasehold enfranchisement is introduced, it may well be necessary to exclude from its scope leasehold property held by local and public authorities as ground landlord, whether it is held for development (as in the case of New Town Corporations and local planning authorities) or for investment (as in the case of the Crown Lands Commissioners and the Duchies of Cornwall and Lancaster).
9. There is also the question whether tenants who purchase a ground lease during the last, say, 10 or 15 years of its term should be excluded from the scheme, on the ground that their stake in the property is not really greater than that of an occupational tenant under a short lease and that security of tenure at the end of the lease is sufficient for them; and whether landlords who brought the superior interest towards the end of the term with a view to occupation or re-development on the expiry of the lease, and who paid a large sum for the reversion, ought likewise to be excluded. These suggestions lead to considerable difficulties, which are discussed at length in paragraphs 17-25 of the Annex to C.P.(51) 205 and summarised in paragraph 26 of the Annex.
Summary
10. The questions for decision are summarised in paragraph 48 of the Annex to C.P.(51) 205. Our general feeling was that questions 1 and 2 (all parts) should be answered in the affirmative. As to the questions relating to leasehold enfranchisement, we thought that, without prejudicing the general issue whether leasehold enfranchisement was or was not desirable, we might ask for a scheme to be further worked out on the assumption that there would be affirmative answers to questions 3, 4 and 5. Our discussion showed some differences of view about the details in question 5: probably, however, a preliminary draft Bill could be prepared on the basis of alternatives, which would assist Ministers in reaching a firm decision.
House of Lords, S.W.1,
25TH JULY, 1951. THE DEATH PENALTY UNDER THE NAVAL DISCIPLINE ACT
Memorandum by the First Lord of the Admiralty
At its meeting on 22nd January (C.M.(51) 5th Conclusions, Minute 1) the Cabinet considered a memorandum by the Minister of Defence on certain questions of policy arising out of the recommendations of the Lewis and Pilcher Committees on court-martial procedure and agreed that the preparation of a Naval Discipline Bill should proceed. When the Bill is introduced discussion of the death penalty provision in the Naval Disciplinary Code will be inevitable because for historical reasons the present Act differs markedly in this respect from the Army and Air Force Acts. I am, therefore, anxious to introduce amendments which will bring the Naval Code into line with the others, so far as inherent differences in circumstances allow, and which will generally ensure that the death penalty is prescribed only in those cases where it would be logically defensible under modern conditions.
General
The amendments proposed are shown in detail in the Appendix. Broadly they fall under four heads:
(i) the mandatory death sentence is everywhere abolished;
(ii) the death sentence is replaced as a maximum sentence by imprisonment exceeding two years in those cases where the lower maximum is already prescribed for a corresponding offence in the Army and Royal Air Force (these are deserting post and sleeping on watch in the presence of the enemy) - and also in the case of certain other offences, if committed through cowardice, where the analogous offences in the Army and Royal Air Force still carry the death penalty as the maximum, e.g. - surrendering ship to the enemy when capable of making a successful defence or improperly withdrawing from a fight or forsaking station, and failure to use utmost exertions to carry out orders of superior officers to prepare for action or during action;
(iii) the death sentence is abolished in certain cases where it is now clearly obsolete - arson in dockyards etc., failure in defence of convoy, and
(iv) the maximum sentence for mutiny is reduced in certain circumstances from death to imprisonment. I need only elaborate on (iv).
**Mutiny**
Experience shows that it is now possible to mitigate the severity of the sentences prescribed for mutinous offences except during war and in conditions equivalent to a state of war without any prejudice to naval discipline. I propose therefore:
(a) That death be retained as the maximum punishment at all times for mutiny accompanied by violence (Section 10). This would, however, be amended to prescribe the death sentence for mutiny accompanied by threat of violence or threatened use of arms. It would also be necessary to retain the death sentence at all times as the maximum punishment for incitement to mutiny with violence, threat of violence or threatened use of arms.
(b) That otherwise the maximum sentence of death for mutinous offences be retained only for offences committed in time of war and, in time of peace, for those committed in circumstances analogous to active service under the Army code and when under orders for such service.
2. "Active service" as a term does not exist in the present Naval Discipline Act; but the amendment would retain the death penalty for mutiny in the following circumstances:
(a) Service during operations, or in an area in which operations are taking place, against the enemy. The word "enemy" is already defined in the Act to include armed rebels, armed mutineers and pirates but would need to be extended to include armed rioters and forces such as the North Koreans and Chinese with whom we are now engaged in hostilities without being in a formal state of war.
(b) Service by persons who are landed in foreign countries in defence of life and property.
I am advised that this would result in a reasonably close approximation to "active service" under the Army and Air Force Acts. I do not propose, however, to take powers similar to those in the Army and Royal Air Force codes, whereby either the Admiralty or naval authorities could, in certain circumstances, by declaration, place a force under active service conditions for purposes of discipline, solely to make a mutinous offence incur the death penalty as the maximum punishment.
3. The Minister of Defence and the Secretaries of State for War and Air have expressed their concurrence in these proposals so far as mutiny is concerned, and have no objection to the Admiralty proceeding with the other proposals mentioned in paragraph 1. I understand that, if the proposals are put into effect, the Army and Air Councils would wish to amend the Army and Air Force Acts to provide that the death sentence for mutinous offences would be incurred under conditions broadly similar to those described in the amendments and that they would also wish to consider, for inclusion in the next year's Annual Bill, whether some further amendment of the death sentence provisions in Sections 4 and 6 of those Acts would be necessary in the interests of uniformity. I therefore seek the approval of the Cabinet to include in the Naval Discipline Bill the amendments shown in the third column of the Appendix.
Admiralty, S.W.1, 26TH JULY, 1951. APPENDIX
(Only those offences for which the death sentence is prescribed are shown against each section. Amendments shown in the third column are those which affect the punishments only.)
| N.D.A. Section | Offence | Proposed Amendment to Punishments | |----------------|-------------------------------------------------------------------------|-----------------------------------------------------------------------| | 2 | Misconduct in Action by a Flag Officer, Captain, Commander or Officer Commanding. | Reduce mandatory death sentence to maximum death sentence. | | | If he has acted traitorously | Reduce maximum from death to imprisonment. | | | If he has acted from cowardice | | | 3 | Failure by an officer to pursue enemy or assist friend, or improperly forsaking his station. | Reduce mandatory death sentence to maximum death sentence. | | | If he has acted traitorously | Reduce maximum from death to imprisonment. | | | If he has acted from cowardice | | | 4 | Delaying or discouraging action or service | No change (but subject to further consideration in the Admiralty with a view to reduction of the maximum death penalty). | | | Deserting post in presence or Sleeping on Watch vicinity of the enemy. | Reduce maximum from death to imprisonment. | | 5 | Failure by a person other than a Commanding Officer to use his utmost exertions to carry the orders of his superior officers into execution when ordered to prepare for action or during action. | Reduce mandatory death sentence to maximum death sentence. | | | If he has acted traitorously | Reduce maximum from death to imprisonment. | | | If he has acted from cowardice | | | N.D.A. Section | Offence | Proposed Amendment to Punishments | |---------------|-------------------------------------------------------------------------|-----------------------------------------------------------------------| | 6 | Spying for the enemy (by persons subject to the Act and others) | No change. | | 7 | Holding traitorous correspondence with or giving intelligence to the enemy by persons subject to the Act | No change. | | | Failure to disclose information received from the enemy subject to the Act | No change. | | | Relief of enemy with supplies | No change. | | 10 | Joining in mutiny with violence | No change to maximum: death sentence, but same punishment to be incurred for: | | | Failure to use utmost exertions to suppress mutiny with violence, if acting traitorously | (1) mutiny accompanied by threatened use of violence or of arms; | | | | (2) incitation to mutiny actual or intended, with violence or threatened use of violence or of arms. | | 11 | Ringleader of mutiny not accompanied by violence, threat of violence (etc.) | Reduce maximum death sentence to imprisonment except: in time of war and on active service. | | 12 | Seduction from duty or allegiance or incitation to commit any act of mutiny, by a person subject to the Act | -do- (except as provided for incitation to mutiny with violence etc. at (2) under S.10 above). | | 13 | Seduction from duty or allegiance by a person on board H.M. ship but not otherwise subject to the Act | -do- | | 19 | Desertion to the enemy | No change. | | 30 | Failure to take care of and defend ships under convoy | Sections to be repealed. | | 34 | Arson in Dockyards, shore establishments and ships | Reduce maximum death sentence to imprisonment. | THE EUROPEAN DEFENCE EFFORT AND EUROPEAN INTEGRATION SCHEMES
Memorandum by the Secretary of State for Foreign Affairs
The purpose of this paper is to consider what we could do by way of precept and exhortation to stimulate the defence efforts of Western European Governments, and to examine the connected question of European attitudes towards schemes of continental integration.
2. Western European Governments are hampered in their defence efforts by the state of mind of their people, large numbers of whom are either opposed to rearmament altogether or are afraid of its economic and political effects. Over a quarter of the population of France and Italy still vote Communist either for social and economic reasons or because of Soviet peace propaganda. Among the non-Communists there is a widespread feeling that rearmament is at best useless and at worst dangerous; useless because it may not be enough to stop the Russians, dangerous because it may provoke the Russians to attack while in the meantime undermining prosperity and so increasing the forces of native Communism. There is also a certain restiveness as to what is conceived of as American pressure, combined with anxiety about the purposes of American policy, though the Americans are still relied on for aid. The Governments thus lack the necessary popular support to put any drive into their rearmament efforts. Their unwillingness to impose the necessary sacrifices on the better-to-do sections of the population (on whom politically they tend more and more to depend), combined in many cases with archaic fiscal systems, acts as an impediment to increased production, and they use the argument that to impose additional burdens on the population to finance rearmament would be playing into the hands of the Communists.
3. There is also a fairly widespread feeling on the Continent that the nation is no longer a viable political unit and that the survival of Western Europe depends on the creation of some type of larger unity. The frustration of this urge for unity to some extent contributes towards the lack of enthusiasm for rearmament, though the strength of the urge and the reasons for it vary from country to country. It seems to be strongest in France and Western Germany, fairly strong in Italy, Holland and Austria, and least strong in the Scandinavian and Iberian countries. In all cases support for European integration is based on a blend of idealism and political motives, economic motives seeming to play little part. The main motive of the Germans is no doubt to regain national equality, for they can count on their national strength to assure for their country the position of primus inter pares in any integrated European system. The French aim is to unify Western Europe both against the Russian danger and against the excessive influence of the United States, and to bind Germany securely. to the West. There also appears to be a certain variation of attitude towards the different possible forms which integration might take. The most advanced form, that of a United States of Europe, is advocated only by extremists. There is a good deal of support for the 'Strasbourg thesis', i.e. the surrender by Governments of policy on selected subjects to a central supra-national authority, but this seems everywhere to have lost ground in favour of what may be described as the 'Schuman Plan Concept', i.e. a pooling of sovereignty not primarily or directly over policy but over "commodities". This concept finds little support in the Scandinavian and Iberian countries, and it is precisely in these countries that most support is to be found for the North Atlantic Treaty principle. The French for their part are beginning to appreciate the value of the Atlantic connection but they regard the North Atlantic Treaty Organisation not as integration but merely as a modernised form of the old-fashioned system of alliances and they would like to go further than this. There is no doubt an element of escapism in all schemes of integration and some of their supporters are no doubt animated by 'neutralist' sentiment.
4. It follows from the analysis in paragraph 2 above that we should:
(i) take what opportunities we can to help persuade the Europeans generally:
(a) that the North Atlantic Treaty powers are capable of producing a system of defence sufficiently strong to stop the Red Army on the frontiers of Western Europe;
(b) that the process of rearmament is not likely to provoke Russian aggression but that on the contrary weakness will invite it;
(c) that the sacrifices involved in present rearmament programmes have been much exaggerated in some quarters especially if increased production can be achieved;
(ii) in addressing ourselves to European statesmen at international gatherings, dwell particularly on the themes of social justice and fiscal reform.
It also follows from the analysis in paragraph 3 of European attitudes towards schemes of integration that it would:
(iii) at least help to rally European interest in rearmament if, even when we ourselves intend to remain outside schemes of integration, we would counter the impression, prevalent on the Continent, that we are hostile to such schemes.
05. There is little in the way of precept and exhortation which we can do to put across theme (i)(a). So long as N.A.T.O. ground and air forces are manifestly inferior to the Red Army the Europeans will continue to suffer from a feeling of insecurity. Theme (i)(b) has for long formed part of our propaganda on the nature of Soviet imperialism and there are no obvious new measures for us to take to drive the lesson home. There will, however, be a number of opportunities during the next few months for expounding our views on themes (i)(c), (ii) and (iii).
06. The Chancellor of the Exchequer took the opportunity of his visit to Paris on 13th July to fire some opening shots. The theme of his conversations with the other European statesmen was the apathy prevalent in Europe and the threat created by rearmament to the standard of living as a result of the consequential rise in prices. He pressed his view that the rise in prices (cost inflation) was the main issue and he expressed the hope that when the Consultative Assembly of the Council met in October the debate might be steered to bring out the need for fiscal reforms and social justice. There is general agreement that the Organisation for European Economic Co-operation should communicate a further and more stimulating report to the Assembly of the Council of Europe for their debate in October and I understand that the Chancellor will be willing to present this report to the Assembly himself, if others are agreeable. This will give him the opportunity of further enlarging on the themes in question.
07. The Committee of Ministers of the Council of Europe meets in Strasbourg on 2nd August. I will then have an opportunity to take up the same themes myself as well as to define the attitude of His Majesty's Government towards projects of Continental integration. While it will be essential for me to reaffirm the attachment of the United Kingdom above all else to the Atlantic connection I would also like to take the opportunity of making a gesture of friendship towards the "Schuman Plan Concept" (not to the Schuman Plan itself). There would be no need for me to suggest the possibility of British participation in any schemes of integration but I could go some way towards removing the belief that we are automatically opposed to all ideas of European integration even without our participation. I would have to choose my remarks in order not to appear to be blessing any project for integration which might be put forward and I would not propose to mention any particular project by name.
08. Finally the Council of the North Atlantic Treaty will meet probably in Ottawa in mid-September. This will be the main occasion on which to put pressure on the European Governments to increase and speed up their defence efforts. The Financial and Economic Board of the North Atlantic Treaty Organisation will almost certainly be submitting a report to the Council, the primary purpose of which will be to examine the economic implications of rearmament and the relative burdens on the economies of the different countries of the defence efforts to which they are pledged and to offer some suggestions as to the methods by which these direct burdens of defence might be equitably shared. The United Kingdom representative on the Board is being instructed to try to ensure that the report brings out the lesson that the burdens already accepted by the European countries are not so grievous as some of their Governments have been inclined to pretend and that the remedy for many of their difficulties lies in their own hands. At the same time we will also bring out the burdens imposed on many countries by the sharp deterioration in the terms of trade. Ministers attending the Council meeting will be able to rub these facts in.
09. I invite my colleagues to endorse the general line of action suggested in paragraphs 6-8 above.
10. Since this paper was drafted I have had a report from the United Kingdom Delegation to the Organisation for European Economic Co-operation that M. Stikker and M. Marjolin have made certain proposals which may involve some modification of the details, though not of the general line and purpose of the programme of action which I have outlined.
H.M.
Foreign Office, S.W.1,
27TH JULY, 1951. CONFIDENTIAL
C.P. (51) 231 26th July, 1951
CABINET
FUTURE OF THE BRITISH COUNCIL
MEMORANDUM BY THE SECRETARIES OF STATE FOR FOREIGN AFFAIRS, COLONIES AND COMMONWEALTH RELATIONS
At their meeting on 21st February, 1946, (C.M. (46) 17th Conclusions, Minute 4 (2)) the Cabinet agreed that the British Council should be continued for a period of five years. This period came to an end on 31st March last.
2. The main conclusions which can be drawn from experience of the Council's activities during the past five years are as follows:
(i) that the Council, in its work of familiarising foreign, colonial and Commonwealth peoples with the ideals, methods and achievements of this country, lends an important aid to the maintenance of British political and trading influence in the widest sense, and plays an increasingly important part in developing satisfactory relations between this country and the peoples of the colonies and of the new self-governing territories of the Commonwealth; that it is valuable as presenting a positive alternative to communism; and that these services are such that, if the Council did not exist, some other agency supported by public funds would be needed in its place;
(ii) that there are solid advantages in this work being done by a non-official body and not by a governmental organisation.
Recommendations
3. We have therefore four recommendations to make:
(1) That the British Council's existence should be prolonged indefinitely, but that some form of review should take place at the end of ten years in order to ascertain whether any modifications of the existing organisation and administration are necessary.
(2) That the non-official status of the Council should be preserved.
(3) That since, in order to plan work of a long-term nature, to lease premises and to secure a fair proportion of staff on a long-term basis, some form of stabilisation of its authorised expenditure is essential, the Overseas Departments should be instructed to work out, in consultation with the Treasury, a reasonable minimum figure below which, subject to exceptional circumstances, the income of the Council should not over a number of years be permitted to fall.
(4) That in the course of the examination referred to in (3) attention should be given to the possibility of making further reductions in the size of the Council's headquarters.
Circumstances of the Cabinet decision of 1946 and the principal questions now to be decided
04. The British Council is a grant-aided body incorporated by a Royal Charter which sets no limit to the period of its existence, but no special financial provision has ever been made for its work to continue indefinitely. On 22nd June, 1944, the War Cabinet Committee on the Machinery of Government recommended that a full enquiry should be carried out under the auspices of the Foreign Secretary and the Chancellor of the Exchequer. This enquiry was undertaken by Sir Findlater Stewart, who reported on 8th February, 1945, in favour of its continuance as an independent organisation, but with certain changes in the form of its governing body. The Foreign Office did not agree with a number of his recommendations. The whole matter was included in the purview of an Official Committee on Government Information Services, whose report was presented to the Cabinet by the Lord President of the Council on 12th February, 1946 (C.P. (46) 54). The Cabinet, at their meeting mentioned in paragraph 1, gave authority for the Council to continue for a further five years "on the understanding that there should be a closer scrutiny of its projected activities, that it should no longer have authority to do its own production and procurement work, and that its scope should be restricted to educational and cultural work and should not overlap with the Government's Information Services."
05. There has been no difficulty in putting into effect the second and third provisions of this decision, and as regards the first a close scrutiny of the Council's activities has been maintained by the Overseas Departments at home and their representatives abroad, and the Select Committee on Estimates (1947-48 Session, Third Report) has investigated them in great detail. Particulars of the financial side of the method of control are given in paragraph 3 of the Appendix to this paper. Generally speaking, this scrutiny has achieved its end. The matter, therefore, which we now put before our colleagues is that of the future of the Council's existence, and this appears to depend on the answers to two questions: (1) whether the work done by the British Council is an indispensable adjunct to the policy of His Majesty's Government towards foreign, colonial and Commonwealth countries, and if so (2) whether that work is better done by a non-official body than by a Government Department.
06. The Cabinet in 1946 gave a qualified affirmative answer to both these questions. Experience of the British Council's operations on the scale to which they had grown was mainly that of war-time, and it was necessary to observe their effect in the post-war situation. An assessment of the Council's work in its three overseas spheres since 1946, and some idea of what would be involved if that work were to be transferred to another agency or agencies, may be had by reference to the Appendix, which outlines the framework of the Council as it now is, its relation to Government Departments, the types of establishment it maintains in the field, and the subjects they handle.
07. It seems clear that the work done by the British Council is an indispensable adjunct to the foreign, colonial and commonwealth policy of His Majesty's Government; and that, if the Council did not exist, His Majesty's Government would have to find some other agency or agencies through which to present to other peoples a full and balanced picture of the life and thought of this country as a means of disposing them well towards us, and as a positive alternative to communism, to discharge their obligations to international organisations and under international treaties, and to operate important educational schemes such as that for the welfare of overseas students.
08. As regards the second question, in 1946 the Cabinet decided that the balance of advantage lay on the side of preserving the Council's non-official status under certain provisos. Those provisos, as will be seen from paragraph 5 above, have been acted upon, and the experience of the past five years of the work in the three overseas spheres and in the United Kingdom set out in the Appendix has confirmed the wisdom of this decision. In this connexion it is of interest to note that the Report of the Select Committee on Estimates (Session 1947-48 Third Report) put as its first recommendation that the work should be carried on under the existing system, and not incorporated in a Government Department (paragraphs 7 and 47 (i) of the Committee's Report).
09. In the light of the foregoing it is concluded that the continued existence of the British Council is in the national interest. The work is essentially long-term in its nature, and suffers from any uncertainty as to continuity. Doubt as to its life makes it extremely difficult for the Council to recruit or retain the most suitable staff. In the circumstances it would appear reasonable to prolong the Council's existence indefinitely, but that some form of review should take place at, say, the end of ten years, in order to ascertain whether any modifications of the existing organisation and administration are necessary. Stability of Income and Effect of Cuts
10. It has been pointed out that the Council's work is of long term, and that uncertainty as to the Council's future adversely affects both work and staff. But even if it is accepted that the Council's existence should be indefinitely prolonged, the Council is handicapped if it does not know from one year to another to within several hundred thousand pounds how much money it will have available. This affects all fields of work, but has particular reference to the Foreign Office grant-in-aid. This grant-in-aid was cut by £343,000 in 1948, £19,000 in 1949, £325,000 in 1950 and £364,000 in the current year. The total estimated expenditure for the current year is £2,650,000, of which the Foreign Office grant-in-aid is £1,862,000. In terms of activities, these successive cuts have, over and above economies that could be effected without undue sacrifice, caused inroads into valuable work which include the following: withdrawal from three Latin American countries and more than halving the work in the remainder; withdrawal from Iceland, the Sudan and (except for one school) Ethiopia; the closure of two centres in Persia, two in Egypt, two in Turkey, three in Italy, one in Greece, one in Austria, one in Portugal, five in France and the Benelux countries; postponement of projected development in India and Pakistan; a reduction of 28 per cent. in the number of scholarships and 49 per cent. in the value of bursaries, a reduction of 25 per cent. in the current year alone in the supply of books, and abandonment of commissioning new Council films.
11. These reductions were not finally determined until the Estimates were due to be submitted to the Treasury. This is disturbing in its effect on the staff and wasteful in its effects on the work. The recruitment and retention of a fair proportion of permanent or at least semi-permanent staff of the right quality is essential. Many of the Council's operations, both in the artistic and the educational spheres, require long-term commitments and a good deal of planning ahead. The work involves leases and contracts, most of which must be based on the academic year, which cuts across the financial year, and these make up a substantial part of the overseas expenditure. Educational facilities at universities and colleges can rarely be arranged at short notice. Sudden cuts on such commitments yield only a portion of their value in the immediate year, with the result that the Council is forced to cut what in a full year represents more, and to select economies for their immediate yield rather than their relative importance. The Council was extravagant in the years preceding the Cabinet review of 1946, but under the present full-time Chairman, who was appointed in that year, and the advice of Government Departments things have been put right, and this should be all the more reason to avoid now what militates against sound planning.
12. In the Commonwealth and the Colonies the effect of this financial uncertainty is also detrimental. During the period under review it had been agreed by the Overseas Departments that an expansion in these fields during the next few years was necessary, in consequence of the grant of autonomy to India, Pakistan and Ceylon and the diminution of political control from the United Kingdom in Colonial territories referred to in the last sentence of paragraph 15 of the Appendix. But sudden limitations imposed upon the Council's expenditure have militated against the application of any orderly long-term programme of expansion.
13. The non-official members of the Council's Executive Committee, on learning of the nature of the cut likely to be imposed this year, circulated a memorandum on 5th January, 1951, to the nine Ministers nominating the official members of the Committee. They later sent a deputation to interview the Prime Minister on 6th February and put forward three requests: (1) to be able to plan the work on a stable basis over a period of years; (2) to be able to establish the staff on a permanent footing with a defined and permanent field of activity; and (3) to be consulted at an early stage when the Council's affairs are under discussion by Government Departments.
14. Clearly it is not possible for His Majesty's Government to bind themselves as to what the British Council may be allowed to spend in future years. Nevertheless, in the interests of enabling the Council to carry out its essentially long-term work with suitable staff, we consider that some form of stabilisation of its authorised income is essential. We therefore suggest that the Overseas Departments be instructed to work out, in consultation with the Treasury, a reasonable minimum below which, subject to exceptional circumstances, the income of the Council should not over a number of years be permitted to fall.
15. Our colleagues may feel that in the course of this examination attention should be given to the size of the Council's headquarters' staff in this country. This is a point to which public criticism has been directed in the past; and, although substantial reductions have been made since the Select Committee on Estimates drew attention to the matter in 1948, it is conceivable that there may be room for some further small economy.
H. M. J. G. P. C. G. W.
APPENDIX
THE BRITISH COUNCIL'S ORGANISATION, RELATION TO GOVERNMENT DEPARTMENTS AND METHOD OF WORK
1. The governing body is an Executive Committee of 30 members, containing Members of Parliament, distinguished persons from the principal fields of education, art, science, the Trades Union Congress, &c., and 9 nominees of Government Departments, including, of course, the three Overseas Departments. Its Chairman is also the Director-General of the Council's regular executive organisation, and is thus a whole-time salaried official. He is appointed by the Executive Committee after consultation with the Foreign Secretary. A number of Advisory Committees, consisting of persons distinguished in certain branches of learning, art, science, medicine, &c., serving in a voluntary capacity, advise the Council on their particular subjects. The regular staff in the London office, partly headquarters proper and partly departments supplying material for use in the field or performing executive functions of educational work, are in constant touch at various levels with the Overseas and other Government Departments.
2. The Council is represented in 34 foreign countries, 16 colonies and 5 self-governing States of the Commonwealth.
3. As regards financial control, the Council administers a grant-in-aid for the Foreign Office. All activities financed from the grant-in-aid which are new, or are extended to a new territory, or which involve a question of financial principle, all projects costing £5,000 or over, and all posts involving a salary of £1,000 or more require individual Treasury sanction, which must be applied for through the Foreign Office. The Council works for the Commonwealth Relations Office and the Colonial Office, for technical reasons, on an agency basis. It follows from this that financial control is close. The recent Report of the Organisation and Methods Division of the Treasury (November 1950), which was confined mainly to the Council's headquarters in London, confirmed that the Council was "operating economically with clear practical objectives and with a good standard of financial control." Representatives of the Overseas Departments sit on the committee which prepares the annual budget. The Council's Representatives abroad are under instructions to keep close touch with His Majesty's Missions, and the latter receive copies of their annual budget proposals and forward them to London with their comments. His Majesty's Missions in foreign countries will shortly receive instructions to include in their quarterly reports on Information matters a section on the work and administration of the British Council and to give particular attention to their supervision of its activities. A scheme has recently been accepted by the Council whereby the Foreign Office Inspectors, when inspecting His Majesty's Missions abroad, also inspect the Council's establishments. The Inspectors' reports on the Council's establishments are sent both to the Foreign Office and to the Council.
4. The Council's work in the artistic and literary spheres is by no means the principal part of its activities. Expenditure on fine arts, music, drama, books, periodicals and films in 1950-51 amounted to slightly under 10 per cent. of the total expenditure. Of these, moreover, books and periodicals are supplied to libraries as a necessary accompaniment to promoting a wider knowledge of the United Kingdom and the English language, and the films are documentary, mostly suitable. for use as complements to lectures, and include special medical and scientific films. The rest is spent on education, science, the teaching of English, the care of overseas visitors and students, and publicising ourselves and our various contributions to democratic civilisation. Education includes teaching the English language, subsidies to British schools abroad, subsidisation of posts of university and school-teaching staff held by British subjects in institutions of other countries, and bringing over to this country, on scholarships and bursaries, students (mostly post-graduate), technicians, trade unionists, manual workers, nurses, &c., for the study and practice of our methods. English teaching includes summer schools for foreign teachers of English and, when invited, advising foreign educational authorities on the subject. An important element throughout is the liaison work of putting individuals and bodies overseas in touch with their counterparts in this country; this has particular reference to work in countries whose state of development approximates most closely to our own.
5. The organisation maintained to handle this work overseas consists, first and foremost, of the Council's Institute or Centre. This as a rule contains a library, reading room, hall for lectures, debates, film shows, concerts, exhibitions, and rooms for study groups and classes. In certain places the Council is an agency for the holding of British examinations such as the London Matriculation and the Cambridge English examinations. English teaching is concentrated mainly on teaching the teachers, and is generally confined to countries where the standard attained in the local education system is unsatisfactory. In a number of places, instead of a Council Institute or Centre, the organisation takes the form of an anglophile club, supported by local subscription and possibly a Council subsidy, to which the Council supplies the secretary and other key positions. These anglophile societies (e.g., in Latin America) are often largely occupied with the teaching of English.
6. In the United Kingdom the Council maintains establishments in several, mainly university, towns for the benefit of overseas students and visitors. There is in most cases a Council Centre in which activities similar to those in the Institutes and Centres abroad are conducted, except that English classes and examinations are not held, the library is a less important feature, and instead there are a canteen and student welfare activities with recreational facilities. In certain towns there is, in addition, a students' hostel and welfare centre.
Work in Foreign Countries
7. Since the Cabinet decision of 1946, the changes in the world political situation have given a new emphasis to the Council's purpose and activities. The task defined in the Council's Charter as "promoting a wider knowledge of the United Kingdom" is now in fact bound up with the wider task of defending Western civilisation against the inroads of communism by presenting a positive alternative. The Communist countries have paid their tribute to this by preventing the Council's establishment in the U.S.S.R. and Roumania, and expelling it from Czechoslovakia, Hungary, and Bulgaria. The development of the "cold war" and of defensive groups such as Western Union on the one hand, and the growth of United Nations Specialised Agencies and cultural conventions on the other, have added considerably to the Council's responsibilities. The Brussels Treaty and the Council of Europe both involve cultural work which His Majesty's Government looks in part to the Council to discharge; and the Council is generally His Majesty's Government's principal nominated agency for the implementation of cultural conventions signed since the war.
8. The Council's work is also of benefit to British trade. It is significant that the Shell Company are (anonymously) financing the Council's representation in Venezuela rather than see it withdrawn (as it would have been on grounds of economy). Concrete examples of trade benefits are a half million pound order which resulted from the Council's work on anaesthesia in Italy and many orders for technical equipment which followed the Council's work in Turkey, Chile, and elsewhere.
9. Experience of the work in foreign countries has shown that the Council's non-official status bestows three signal advantages. It removes the taint of political propaganda; it permits access to groups and institutions (e.g., universities, professional associations, trade unions) which would be much less accessible to an official body; and it enables the Council to stand aloof from the political estrangements which from time to time beset the course of official international relations. The Council have been able to develop techniques which an ordinary Government Department cannot possess. An example of what this may mean is the Council's work in Yugoslavia. In the years immediately following the war, when Yugoslav official co-operation was almost entirely lacking, the Council was able to preserve many contacts which would have been denied to British officials and thus to continue its work and turn things to account when official relations improved. The following is an extract from a report in the Christian Science Monitor of 27th April last by their Special Correspondent in Belgrade on Yugoslavia's rapid development of cultural ties with the West and the abolition of Russian as a compulsory second language. "... Within a month, enthusiastic but overworked officials of the British Council, a cultural organisation working in foreign countries with the support of the British Government, were able to report that 80 per cent. of the students were choosing English. Since then, interest in the English language and, through the language, in English history, literature, natural science and the arts, as well as present British political experience has 'swept the country.' In twelve months the British here, through their Embassy and the British Council, have chalked up a record of non-political cultural achievement in Yugoslavia without a parallel in any Communist country since the Russian Revolution."
Work in the Commonwealth
10. In the Commonwealth the Council has Representatives and offices in Australia, New Zealand, India, Pakistan and Ceylon, and although, for political and financial reasons, there are no Representatives as yet in South Africa and Canada, certain services such as lecturers, exhibitions, &c., are provided direct from London.
11. The work of the Council in the Commonwealth is still in its infancy. The oldest post, Australia, was set up only five years ago, and the latest, Ceylon, in 1950. This extension of Council activity has been the direct result of invitations of the Commonwealth countries concerned.
12. The Council has a very definite rôle in strengthening Commonwealth links. Even in a country like New Zealand, where the British tradition is strong, it cannot be assumed that this will always remain so. Both New Zealand and Australia feel isolated from the United Kingdom and there is a danger, already apparent in Australia, that the traditional ties may weaken.
13. In the Asian countries of the Commonwealth it is vital to retain and develop, through all possible means, the British connection. On the success of this largely depend the links of those countries with the West. The positive exposition of Western thought through literature, the arts and science can do much to resist the influence of Communism and help to consolidate the goodwill of those countries towards the United Kingdom which at present is very marked, but which may not persist automatically. It must also be remembered that in India English will, in some years' time, cease to be an official language and this may lead to the lowering of the standard of English teaching in the Universities and Colleges, and general decline of interest in English culture. The Council can do much to counteract this tendency.
14. It has been suggested that this cultural work could be handled by the official Information Services and by cultural attaches. No doubt certain routine services could be dealt with in this way, but these are the least important side of the Council's work. The particular value of the Council rests on its close links with academic, artistic and professional circles with which it can collaborate much more freely and with greater effect than would be possible if it were a purely official body.
Work in the Colonies
15. The same can be said of work in the Colonies. Sir Findlater Stewart, in his report, compared the work of the Council in the Colonies with its activities in foreign countries in the following terms: "The work of the Council in the Colonies stands on a different footing from the work in foreign countries. In the latter the Council has not, and cannot have, the responsibility for the educational or cultural advancement of the people except for the limited purpose of showing them the British way of life. The cultural advancement of colonial peoples and the promotion of their cultural relations with this country are parts of a single task. and responsibility for it rests with the Secretary of State for the Colonies and would so rest if there were no British Council." The position has changed very greatly since these words were written, and a rather different assessment of the situation is required to-day. Over the whole colonial field there have been notable advances towards local self-government in domestic affairs, and this process is becoming intensified. If the colonial peoples are to remain in contented association with the United Kingdom as they become politically mature, it is essential to keep before them, and particularly before the influential sections of the colonial communities, the value of the British connexion, to foster co-operation between the various racial elements in the communities, and to strengthen the ties of culture and tradition on which we must increasingly rely as political control from the United Kingdom is withdrawn.
16. The British Council has proved to be the most efficient and the most acceptable instrument for promoting such mutual understanding, and its work becomes more necessary as the executive governments in the Colonies become more representative of the local population and less an agency for carrying out centrally-controlled policy. The very circumstances which make this work more necessary render it impracticable for it to be done by any existing department of Government, and the more desirable that it should be done by the existing non-official agency rather than by any new agency to be created for the purpose. A recent enquiry addressed to the Governors of all colonial territories where the Council is operating, or is about to start operations, produced a unanimous testimony to the need for the Council's work and, in the case of many territories, pressing requests for the extension of its activities. Over a wide range of this work, the Council must clearly employ the same techniques in relation to the Colonies as in relation to foreign countries and Commonwealth States, and it should therefore have reasonable freedom to plan and execute its operations as a whole, subject to directives from the Government Department concerned.
Work in the United Kingdom
17. The work of the Council in the United Kingdom is an essential complement to its work overseas.
18. The arrangements made through the Council for the reception and guidance of students, visitors and bursars are an invaluable means of creating positive goodwill towards Britain and of counteracting the efforts of subversive propagandists. The special suitability of the Council for looking after colonial and other overseas students, and bringing a healthy influence to bear upon them, was a governing factor in the decision to transfer to the Council from the Colonial Office the administration and executive duties of looking after colonial students and providing accommodation and welfare services for them. This was recognised by the Official Committee set up to consider the Welfare of Overseas Students, whose conclusions were accepted by Ministers (Gen. 231/3rd Meeting, Minute 4, 19th December, 1949). The benefit of this work is to a large extent shared by Commonwealth and foreign students and other visitors. A particular object of putting this work on to an effective footing, free from the accusation of "patronage" and from the disadvantages of the segregation of students by race, nationality, &c., by entrusting it to the British Council was the necessity to combat Communist propaganda, to which it has been found that overseas students without contacts in this country, especially colonials, are in nearly all cases subjected. By reception and welfare arrangements, and help in finding suitable accommodation, this danger has in one year's working been considerably offset.
19. The Council is His Majesty's Government's agency for arranging the programmes of Fellows sent to this country by the United Nations Specialised Agencies, and visitors studying conditions and techniques here under arrangements connected with President Truman's Fourth Point and the Colombo Plan. CABINET
REPORT OF BROADCASTING COMMITTEE
Memorandum by the Secretary of State for Commonwealth Relations and the Postmaster-General
At their meeting on 19th July (C.M. (51) 53rd Conclusions, Minute 2) our colleagues invited us to make it plain in the debate on the Broadcasting Committee's Report that, before reaching final decisions on the recommendations of that Committee, the Government would be prepared to take into account the views expressed in debate.
2. On the main essentials we recommend that there should be no change from the proposals set out in the White Paper (Cmd. 8291):-
(a) The British Broadcasting Corporation should be continued as the authority responsible for all broadcasting in the United Kingdom on substantially the present basis, i.e. the monopoly should continue.
(b) The prohibition of any commercial advertisement or sponsored programme without the written consent of the Postmaster-General should be repeated.
(c) The charter should be renewed for a term of fifteen years.
There was some criticism of each of these proposals, but little that was new, and we are not inclined to attach any undue weight to it.
3. The debate in the main concentrated on the two issues of:-
(a) The percentage of the net licence revenue that the B.B.C. should receive for the next three years.
(b) The constitution of Broadcasting Councils in Scotland, Wales and Northern Ireland.
4. Our colleagues will recall that we originally asked them to agree that the whole of the net licence revenue should be paid to the B.B.C. for three years. The Cabinet decided, however (C.M. (51) 49th Conclusions, Minute 4, Conclusion (3)), that the B.B.C. should receive 85%. We doubt whether any slight concession, e.g. an increase to 90%, would materially reduce criticism and it would tend to weaken the Government's case. The arguments for 85% are strong and we recommend that no concession should be made.
5. On the second point, criticism of our proposals for the constitution of Broadcasting Councils in Scotland, Wales and Northern Ireland was fairly widespread and was based primarily on the possible introduction of politics into broadcasting and on the unsuitability of local authorities for the sort of task involved.
6. Some concession may be felt to be necessary. One course would be to accept the recommendation of the Broadcasting Committee in toto. We feel, however, as we explained in C.P.(51) 183, that there are grave objections to their proposals for a Commission of five persons to be appointed and paid by the Government. In effect this would mean the setting up of separate corporations, with the attendant accentuation of all the difficulties of divided loyalties and overlapping authority which will be present in some degree in any scheme of extraneous control. We fear also that owing to inevitable and embarrassing pressures nationalist elements would tend to be over-represented on these small Commissions and would themselves be exposed to continuous nationalist pressure.
7. Our proposals for the constitution of Broadcasting Councils were accordingly designed to ensure that the Councils should be large, that their composition should be automatic, and representative of all the people in the national region, and be completely independent of the B.B.C. and/or the Government of the day. So composed, they would have been able to exercise a general influence on their Home Programmes without the danger of interference inherent in a small body exercising detailed continuous control, and would have been relatively free from nationalist pressure. Our colleagues will recall, however, that when we suggested that the members of the Councils should be drawn from local authorities we did not propose that Councils should have the direct and autonomous powers that are now to be theirs. The executive powers accorded to the Councils in the White Paper give colour to the criticisms advanced in the Debate that politics would, under our plan, enter into regional broadcasting. We do not suggest that it is practicable at this stage to go back on the White Paper statement of the powers to be given to Councils.
8. The ideal solution should, we think, conform to the requirements that the Councils should be large (e.g. 25 members) and constituted automatically. We can see no way of attaining this other than appointment from the major local authorities. If it is felt to be impossible to adhere to that plan there is little choice other than:
(a) appointment by Government at its complete discretion of, say, 25 members;
(b) appointment by Government at its discretion of, say, 25 persons drawn largely from representative bodies (e.g. local authorities, churches, universities) without any binding commitment as to the bodies to be represented;
(c) appointment by Government of persons nominated by representative bodies.
Course (a) may be felt to be too great a departure from the White Paper proposal. Course (c) has attractions but it would be difficult to draw up a scheme satisfactory to all bodies which might claim rights to be represented. Course (b) gives considerable elasticity while importing the idea that the Council will be representative of wider interests and appears to be the most acceptable alternative.
9. The powers of the Broadcasting Councils outlined in the Debate did not come in for any serious criticism. They go some way to avoid too great fragmentation of the Corporation and we propose that they should be retained. They are that the Broadcasting Councils:
(i) should control the policy and content of their Home Programmes; (ii) should be subject to the duties and obligations of the B.B.C. set out in the Charter and Licence;
(iii) should be bound by the agreed arrangements for party political broadcasts.
(iv) should be advisory in matters of finance and capital development;
(v) should be responsible for the appointment of the staff wholly employed on their Home Programmes, but the contracts of service of the staff should be with the B.B.C. (The Regional Controllers would continue to be appointed by the B.B.C.).
10. The proposals in the White Paper regarding the Advisory Councils for the English Regions were not attacked and we suggest no alteration. We consider it desirable, however, that the first periodical review of the B.B.C. should consider how effectively the Corporation has carried out the recommendation of the Broadcasting Committee that these Councils should be made more representative.
11. We do not think that there is any need to issue a further White Paper giving the Government's decision on these matters. It may be convenient to arrange for a Question to be asked when the House resumes so as to enable the Government's decision to be made public and thus test the reaction of Members prior to the publication of the draft Charter and the Licence.
12. We ask our colleagues:
(i) to agree that no concession should be made on the proposal to pay the B.B.C. 85% of the net licence revenue for three years.
(ii) to decide (a) whether the proposals for constituting Broadcasting Councils set out in the White Paper are to be adhered to or (b) if not, whether the Councils should be constituted by the appointment by the Government at its discretion of, say, 25 persons drawn largely from representative bodies without any binding commitment as to the bodies to be represented.
(iii) to agree that the Broadcasting Councils should have the powers set out in paragraph 9 above.
P.C.G.W. N.E.
27TH JULY, 1951 CABINET
GERMAN CONTRIBUTION TO WESTERN DEFENCE
MEMORANDUM BY FOREIGN SECRETARY AND MINISTER OF DEFENCE
Background
In September 1950 the Cabinet accepted in principle a German contribution to Western defence (C.M. (50) 59th Conclusions, Minute 1). This decision, which was reached with some reluctance, was a necessary pre-condition for obtaining United States agreement to the establishment of an integrated North Atlantic Treaty Headquarters in Europe, the nomination of an American Supreme Commander and the despatch of further American forces to Europe in peacetime. It was based on the view, shared by the United States and British Chiefs of Staff, that even with additional American troops, the allied forces likely to be available would still be inadequate for the defence of Europe; and that if Europe was to be saved from enemy occupation it must be defended in Germany and with German military assistance.
2. The French Government were not at first prepared to agree to German rearmament on any terms, but eventually produced the "Pleven Plan" for a European Army in which Germany would participate. A compromise programme of action was agreed upon by the North Atlantic Council at Brussels in December 1950, when it was decided that—
(a) negotiations should be opened between the three occupying Powers, on behalf of the North Atlantic Treaty Organisation, and the Germans for the raising, on certain conditions, of German units for incorporation in General Eisenhower's integrated force;
(b) the three occupying Powers should also discuss with the Germans "any changes in the present occupation arrangements which might logically attend a German defence contribution"; and
(c) the French Government should invite other North Atlantic Treaty European Governments to a conference in Paris to discuss the "Pleven Plan."
3. The Brussels decisions thus set on foot three parallel sets of negotiations, all of which have a direct bearing on a German contribution to Western defence. The first set (on the raising of German units for incorporation in General Eisenhower's integrated force) has been taking place over the last six months at Bonn and has now been concluded. A report by the three High Commissioners has been agreed with the Germans and submitted to the three occupying Governments. This report outlines German ideas on the form their contribution might take, and points out where these conflict with the conditions laid down at Brussels. The second set of negotiations (on changes in the present occupation arrangements) is still proceeding in Germany and is not likely to reach a conclusion for some months yet. But it is hoped by the end of July or the middle of August to submit a report for the consideration of Governments. The third set (on the "Pleven Plan" for a European Army) has been proceeding in Paris between France, Western Germany, Italy, Belgium and Luxembourg (with other North Atlantic Treaty Organisation Powers, including the United Kingdom, United States and Canada as observers) and has also not yet reached a conclusion. An interim report to Governments is, however, expected to emerge shortly.
4. The United States Government have now proposed in an aide mémoire to the Foreign Office and the Quai d'Orsay that the three occupying Powers should consult together on the Bonn report and, if possible, agree upon a common line before submitting it to the North Atlantic Council. They have suggested that this consultation should take place in the early days of August in Washington through national representatives on the Standing Group and that it should also include an examination of the preliminary report on the European Army. We have replied agreeing generally with the United States proposals, but suggesting that political representatives should be associated with the discussions.
5. The object of this paper is to obtain ministerial approval for the guidance to be given to our representatives in the Washington discussions with regard to both the general policy of His Majesty's Government on a German contribution to Western defence and the detailed proposals contained in the Bonn report.
The Choice before His Majesty's Government
06. Of the three concurrent studies relating to German rearmament only the Bonn discussion, as shown above, has been completed. The conference in Paris is only just approaching the stage at which any clear idea can be obtained of what the European Army would look like, and on present form the discussions on the Occupation Statute have still several months to run. In these circumstances, it is not yet possible to foresee precisely the form in which any German contribution would be raised, and there are certainly other elements in the problem on which we cannot yet express firm views. One of these is the financial implications for the United Kingdom of the creation of a German armed force on any substantial scale. The German Government is already questioning its ability to meet Allied occupation costs from its own budget. It is only a matter of time before some part of the cost of maintaining Allied forces in Germany has to be borne by the Occupying Forces themselves. The creation of a German armed force which will inevitably throw a heavy burden on the German budget, especially in the initial stages, is bound to accelerate this process.
07. His Majesty's Government, while accepting the principle of a German contribution, have always reserved their right to consider the timing and the nature of this contribution. This reservation is still valid, but it does not absolve us from the need to take decisions when circumstances demand it. The stakes in the game far transcend the mere recruitment of a few German divisions. In the first place, the whole future of Western Germany is involved, and on our handling of this matter may turn the question whether she can be retained in the Western camp or not. Any attempt permanently to "sterilize" Western Germany by keeping her disarmed and neutral would inevitably result in her being lost to the West. There are already unpleasant signs in Germany that the position of inequality and the absence of any positive national purpose cannot be maintained indefinitely without grave risk. Secondly, the defence of Europe demands a strategy based on the Elbe and not on the Rhine, and the Western Powers clearly cannot defend Western Germany without German co-operation and the assistance of German man-power. This leads to the inescapable conclusion, already accepted by the Cabinet, that some form of German rearmament is necessary for Western defence.
08. Other important factors are, first, the impatience of the Americans over the slowness of Western European rearmament as a whole and their belief that German participation has become an immediate necessity; second, the breakdown of the Four-Power Talks in Paris, which while they lasted had inhibited a forward policy in this matter; thirdly, the expectations aroused in the Germans by the conclusion of the Bonn discussions and by the public statements of Mr. McCloy. Unless we are to come into open conflict with the Americans and to risk seriously rebuffing Dr. Adenauer and the German Federal Government, we are compelled to move forward.
09. In these circumstances our choice is limited to the question in what form the German contribution should be raised. On this there appear to be three main considerations. First, the military necessity of obtaining an effective contribution at the earliest possible moment; second, the need to consider whether a decision to rearm the Germans might not provoke a change of policy on the part of the Soviet Union and thus bring about a conflict which it is the whole object of our rearmament effort to avoid; and thirdly, the need to ensure that any German rearmament shall take place in conditions which are least calculated to make Germany dangerous to the security of Western Europe, either in her own right as under Hitler or in association with Soviet Russia.
10. Of these three considerations the first is primarily but not wholly military. The military authorities of the United States and the United Kingdom are unanimous in thinking that without the early raising of German man-power to reinforce the Allied forces on the continent there is no hope of holding a Soviet attack. The problem of equipping German forces is no longer believed to be so serious as was originally expected. The United States consider that they will be in a position to provide all the arms required for training purposes in the very near future. While the Chiefs of Staff agree that it would be necessary to phase the training and build-up of German units with the arrival of equipment, they do not consider that this in any way detracts from the need to start recruiting and training German land forces. The political aspects of this are that seven months have passed since the decision in principle was taken by the Atlantic Powers, and nothing has happened. This delay already behind us argues powerfully against further delay.
11. As regards the second point, it has always been the view of His Majesty's Government, and must surely remain so, that we must not be deterred by the fear of Soviet reactions from building up a position of strength in Western Europe. This policy has proved justified at each step which we have taken, from the first conclusion of the Brussels Treaty to the appointment of General Eisenhower as Supreme Commander and the reinforcement of United States troops in Europe. The proposed German contribution is part and parcel of the Western defence effort as a whole; and in order to minimise Russian apprehensions, we must make this abundantly clear. In other words we must ensure that the German effort does not take the form of a national army; that it is clearly tied in with the Western effort as a whole, and seen to be inextricable therefrom. So long as these conditions are fulfilled, we do not believe that the raising of a German contribution, which has now been under active public discussion for nearly a year, would cause any sudden change in Soviet policy.
12. The third consideration leads to the same conclusion. The interests of Western security too demand that German rearmament take place on conditions which tie Germany as closely as possible to the West and offer her a position and a rôle to play in the Western community which will satisfy her energies and ambition.
13. These conditions are realisable now. Widespread German dislike of rearmament has recently given way to increased anxiety regarding European defence. The present German Government is prepared, and even anxious, to raise forces under conditions which would preclude their use for nationalist or revanchiste purposes and would not involve a revival of the old militarist class. Their main condition is that Germany should acquire a broad equality of status with other Powers and that the German forces should have complete equality with those of other participating countries. At the same moment, the French Government, in the European Army Conference, are actively advocating the same concept and are ready to place their own forces in a similar position. This combination of circumstances is not likely to last indefinitely, and if the present occasion is lost we may never again be able to direct German rearmament (which in the long run must inevitably take place in some form) into such controlled channels. Moreover, failure to respond to the new frame of mind in Germany would undoubtedly create disillusion and encourage a return to neutralism.
14. Nor must we overlook the importance of American opinion. The American aide-mémoire referred to in paragraph 4 above contains the sentence:
"The United States Government perceives that an undue delay on this important practical matter (German rearmament) would cause serious doubts as to the seriousness of the purpose of the N.A.T.O. nations to proceed in the most expeditious manner for the creation of an adequate defence of Western Europe."
This point of view is undoubtedly shared to some extent by General Eisenhower who is known to be concerned over the insufficient progress of European defence in general.
15. Strong arguments of British and European self-interest therefore support the view that German rearmament in the form and on the conditions which can be applied to-day is infinitely preferable to what will become inevitable if we try to halt progress. The impetus towards a European or Atlantic solution will be lost and the harsher alternatives of a German nationalist or an eastern-orientated German army may well confront us.
Washington Discussions
16. For these reasons we consider that our objective at the Washington discussions should be to reach agreement on positive recommendations for the early realisation of a German contribution to European defence.
17. In order to reach such agreement it will be necessary to take account of and to reconcile three main elements in the situation: —
(i) the insistence of the French that the European Army solution should be considered in advance of, and given preference to, any direct contribution of German forces to the N.A.T.O. Supreme Command;
(ii) the determination of the Germans not to accept conditions which would place them in an inferior position to the other N.A.T.O. Powers; and
(iii) the overriding need, from the point of view of Atlantic defence as a whole, to ensure that any scheme for a German defence contribution is militarily effective and immediately practicable.
We examined these three elements separately as follows: —
(i) French Insistence on European Army
18. Hitherto all N.A.T.O. negotiations on a German defence contribution have been bedevilled by the conflict between French resistance to any form of German rearmament and American insistence on the immediate need for a German contribution. This conflict has put a serious strain on the relations of the three major N.A.T.O. Powers, which it is important to avoid for the future. It would be a mistake to underestimate French fears of the danger of German military revival on one hand and of action liable to provoke Russia on the other: their plan for a European Army is designed to reduce both these dangers and we consider that the only hope of securing their agreement to a German defence contribution lies in agreeing in principle that it should be made in the context of a European Army. This means that in any arrangement resulting from these discussions the United States, United Kingdom and Germany will have to give the French an undertaking that any German contribution will eventually take the form of a contribution to the European Army. We do not, of course, suggest that the United Kingdom should itself join the European Army.
19. Acceptance of the French thesis on this major point would also have the following advantages: —
(a) it would present German rearmament to the world at large, and to the Soviet Union in particular, in the most favourable and least provocative light possible, i.e., as part of the movement towards European unity and not as a purely military measure;
(b) it would be a further step towards integrating Germany in the West and might prove a useful half-way house to eventual German membership of N.A.T.O.;
(c) it would make the French more willing to agree to a solution of the German political problem which will enable Germany to associate herself with Western defence. (It should be noted here that such a solution is important to us not only in relation to defence but as part of our general political objective, mentioned in (b) above, of bringing Germany into willing and equal partnership with the Western nations.)
(ii) German Desire for Equality
20. The last word about German rearmament must, in the nature of things, be said by the Germans themselves: and in the opinion of the United Kingdom High Commissioner no German Government will ever agree to say this last word, nor if they did, would they be able to pass the required legislation through the German Parliament, until Germany is accorded a status of equality, or approximate equality, with the Allies not only in the military, but also in the political field. The main obstacle to a German contribution is, thus, at least as much political as military in character. On the purely military side the proposed European Army solution should, in itself, go far towards satisfying the German demand for equality. It is an essential point in the French plan that all national contingents should receive equal treatment within the European Army, and that all countries should be on an equal footing in its political and administrative control. The European Defence Commissioner, who would be solely responsible, under the military guidance and command of SACEUR, for the formation and administration of the European Army, would in turn be responsible to a Common Assembly and Council of Ministers, on which all parties would be represented.
21. In one important respect, however, the French plan, in its present form, places Germany in a position of military inequality in relation to the other N.A.T.O. countries. It provides that national units contributed to the European Army (and consequently all German units) shall not be larger than Combat Groups, whereas other national contributions to General Eisenhower's forces would continue to be Divisions. The only militarily feasible way of eliminating this inequality is to raise the size of the maximum national unit contributed to the European Army (and consequently of the German unit) to that of a Division. We therefore recommend that, in return for our agreement in principle to support the idea of a European Army, the French should be pressed to accept the Division rather than the Combat Group as the unit for the European Army. This arrangement would also be more acceptable on purely military grounds, since the Chiefs of Staff have always held that the Division is the optimum unit.
(iii) Requirements of Atlantic Defence
22. Until we receive the promised interim report on the progress of the European Army conference, it is impossible to say for sure how far the French plan, in other respects than the size of units, will be militarily effective as a contribution to the immediate needs of Atlantic defence. It is quite clear that we must obtain the fullest information about the concept of the European Army as soon as possible. Countries which have actively participated in the European Army Conference have been France, Belgium, Italy, Luxembourg and Western Germany. Canada, Denmark, Holland, Norway, Portugal, the United Kingdom and the United States have been represented as observers. According to the advance information that we have been able to obtain, the following proposals are likely to be included in the interim report.
(i) The European Army would be formed in successive stages. The aim of the first stage would be to produce a force of some 30 divisions—backed by reserve and supply units and supported by the necessary air forces. This stage would, it is suggested, take 18 months from the time when agreement to form a European Army had been reached.
(ii) Political authority for the European Army would be exercised by a "Defence Commissioner" responsible to a Council of Ministers representing the countries participating in the European Army.
(iii) The European Army would form part of General Eisenhower's Command under an integrated headquarters responsible to him.
23. It is clear that one of the principle military objections to the French plan is that in its present form it may delay a German defence contribution. We cannot accept such delay without detriment to Atlantic defence as a whole. It is, therefore, necessary to seek to modify the French proposals in such a way that they do not postpone the first practical steps towards raising German units until the organisation of the European Army has been completed. We must, in fact, persuade the French to agree that the two processes should be simultaneous. This would mean that while the Member Nations were working out the practical details of a European Army, the Germans would be allowed to start recruiting and training military units of divisional strength for incorporation in that Army. We should also insist that if those units were ready trained and equipped before the organisation of the European Army was complete they would be temporarily assigned to General Eisenhower's integrated force pending the formation of the European Army. Although General Eisenhower's views on this question are not officially known, we believe they are roughly in line with our own.
The Bonn Report, Size, Nature and Organisation of German Contingents
24. Once it is agreed that the Germans should be allowed to begin raising forces before the European Army plan is complete, it will be necessary to settle the size, nature and organisation of these forces. The only positive proposals yet put forward are those of the Germans themselves, as set out in the Bonn Report; those must, therefore, form the basis of the detailed military discussions in Washington.
25. On the political side, the only two major points of difference between the Bonn proposals and those agreed by the North Atlantic Council at Brussels are that the Germans—
(a) refuse to accept certain controls (including Allied control over the Defence Administration) unless they are applied equally to the forces of other powers taking part in the defence of Europe; and
(b) insist that the administration of defence requires a Defence Ministry instead of the Administrative Office proposed in the Brussels decisions.
26. As regards the first point it is clearly a vital Allied interest to safeguard against a revival of German militarism and a German General Staff, and, therefore, to retain some controls over the German military machine. The exact nature of these controls cannot be determined until we have a clearer idea than we have at present of how the European Army is going to work and of the outcome of the negotiations concerning contractual arrangements. Generally speaking, it seems likely that the incorporation of German units in the European Army, the administrative control of which will be vested equally in all participating Powers, will in itself provide controls adequate for Allied needs and acceptable to German opinion. As regards a German Ministry of Defence, our view is that for practical reasons the Germans will need a special Department for the administration of their armed forces; but the Foreign Office feel that the creation at the present time of a German Ministry of Defence, with a German Minister of Defence at its head, would be offensive to Allied opinion and unnecessarily provocative to the Russians. They have, therefore, suggested that, at any rate for the time being, the German Department responsible for the German armed forces should not be under a separate Minister but under one with other responsibilities (e.g., the Chancellor) and should have some less conspicuous title than Ministry of Defence. The Chiefs of Staff, on the other hand, consider that the only practicable solution of the problem is to create a German Ministry of Defence and that indeed the Germans for their part will be content with nothing less.
Procedure
27. If, as we think necessary, the next meeting of the Atlantic Council is to take the question of a German defence contribution within sight of practical realisation it will be necessary to submit to it firm and practicable recommendations on the form of such a contribution. These recommendations must be acceptable to General Eisenhower, under whose command the German units will come. We therefore propose that as soon as agreement is reached in Washington on the main points of principle, General Eisenhower or his representatives should be associated with the discussions. It might also be advisable, before any recommendations are finally submitted to the N.A. Powers as a whole, to bring in the Germans. Recommendation
28. It is recommended that the instructions to our representatives in Washington should be on the following lines:
(1) We consider that a German contribution to Western defence is militarily and politically necessary, that the negotiations to that end should proceed as rapidly as possible and that the Washington discussions should result in tripartite agreement for its early practical realisation.
(2) The most likely obstacle to agreement will be French reluctance to accept a German contribution except in the framework of a European Army. In order to carry the French with us, it is therefore necessary to be able to assure them that any German forces raised will form part, eventually, of the European Army.
(3) In order to make this concept at once militarily effective and acceptable to the Germans, we should insist on certain modifications in the present French proposals; in particular we should press the French to agree that the national unit in the European Army should be the Division and not the Combat Group, and that, pending the completion of the detailed organisation of the European Army, the Germans should be allowed to begin raising and training units for eventual incorporation in it; meanwhile, they should be temporarily assigned to General Eisenhower's command.
(4) To work out the details of a military solution on these lines for submission to the Atlantic Council, we should propose a subsequent meeting between the military representatives of the three Occupying Powers with General Eisenhower and perhaps also with representatives of the German Federal Republic.
(5) Meanwhile, we should press ahead with the current negotiations with Germany on the replacement of the existing Occupation Statute by contractual arrangements, since a German defence contribution is dependent on their satisfactory outcome.
H. M. E. S.
Whitehall, S.W. 1, 24th July, 1951. CABINET
JAPANESE PEACE TREATY:
JAPANESE SHIPBUILDING CAPACITY
Memorandum by the Secretary of State for Foreign Affairs
On 7th June (C.M.(51) 41st Conclusions, Minute 1(5)) the Cabinet agreed to defer a decision about the manner in which Japanese shipbuilding would be controlled until information was received about the further investigation of this subject in Tokyo.
2. It will be remembered that Mr. John Allison, Mr. John Foster Dulles' Assistant on the Japanese Peace Treaty, went to Tokyo immediately after Mr. Dulles' visit to London in June in order to discuss with the Japanese voluntary arrangements for a reduction of Japanese shipbuilding capacity.
3. On 3rd July, Mr. Allison sent to the United Kingdom Political Representative in Japan a memorandum prepared by the Japanese which contends that present shipbuilding capacity in Japan is not excessive.
4. The memorandum states that the present capacity of Japanese shipyards is not 310,100 gross tons a year but 676,700 tons (the difference between these two figures representing disused yards which are no longer serviceable). The actual operation rate is said to be 70 to 80 per cent. Output is therefore said to be 400,000 to 500,000 tons a year. The memorandum argues that, according to present plans, Japan will possess 1,569,000 tons of ocean-going ships by the end of 1952. Because of the longer hauls involved in Japan being obliged to trade with the United States and other areas instead of with China and the Far East, Japan will need 2,236,000 tons of ocean-going ships in 1953. Another 700,000 tons will thus have to be acquired by 1953, largely from new construction. The estimate of Japan's shipping requirements in 1956 is based upon an estimated overseas trade in that year of 32 million tons (compared with 20 million tons in 1951). On this basis, the memorandum claims, Japan would need 2,956,000 tons of ocean-going ships and 820,000 tons of coastal ships in 1956. This estimate is based upon the assumption that Japan carries 50 per cent of her foreign trade. It follows from these estimates, the memorandum concludes, that the present capacity of Japanese shipyards will be fully occupied at least until 1956, in supplying the essential requirements of Japan.
5. It is difficult to estimate the real requirements of Japan for shipping in the next five years. It is even difficult to say whether 676,000 tons a year is in fact the present capacity of Japanese shipyards. It is probable that the estimate of 32 million tons for Japan's foreign trade in 1956 is inflated. Nor do we accept the assumption that Japan should carry 50 per cent of her foreign trade. In addition the Japanese memorandum takes no account of ships bought by Japan from other countries (the purchase of 250,000 tons has already been authorised by the Supreme Commander). It is probable therefore that during the next five years Japanese capacity will in fact be excessive. Even if the Japanese estimates for the next five years are accepted as reasonable, it is probable that Japanese shipbuilding capacity would in any case be excessive in the period after 1956 because replacement demands would not keep a capacity of 676,000 tons fully occupied. There is therefore danger that after 1956 the Japanese fleet would continue to expand or else Japanese competition for shipbuilding orders would be intensified. Having regard to all the evidence, it seems probable that there is no economic ground for agreeing that Japan's capacity need exceed say a figure of about 400,000 tons per annum.
6. Nevertheless, the Cabinet have decided that no restrictions should be placed upon Japan for security reasons. The only grounds on which we can continue to urge the Americans to bring about some reduction in Japanese shipbuilding capacity is by showing that the present capacity is uneconomic in Japan's own interest. It is clear, however, that the Americans do not at present agree with our interpretation on this point, and as they do not agree we cannot expect that they will consent to the insertion in the present liberal and non-restrictive draft treaty of a restriction upon the Japanese economy designed mainly to reduce her competitive position compared with the United Kingdom. Moreover, while the Australian and New Zealand Governments share our anxieties on this score (see paragraph 3 below), India, Pakistan and Ceylon take the opposite view: they are strongly opposed both to the general idea of a restrictive Treaty and to any reduction of Japan's shipbuilding capacity in particular. To make an issue of this point would thus be to produce an open division between the Asiatic and non-Asiatic members of the Commonwealth, with the Asiatic members aligned on the side of the United States in favour of those liberal principles by which we too claim to have been guided in our general policy over the Treaty.
7. While therefore it is impracticable to suggest, at this stage, that the draft Treaty should include a provision restricting Japan's shipbuilding capacity, I suggest that we should inform the United States Government that we still consider this capacity to be excessive and that we must therefore continue to press for it to be reduced by action outside the Treaty.
8. The Australian and New Zealand Governments are very much concerned on security grounds to obtain some reduction in Japanese shipbuilding capacity. We should therefore give the Australian and New Zealand Governments an opportunity of making a simultaneous approach with us to the United States Government on the lines proposed above.
RECOMMENDATION
9. That we should inform the Australian and New Zealand Governments of the substance of the memorandum communicated by Mr. Allison and state that we propose to inform the United States Government of the reasons for which we still consider Japan's shipbuilding capacity to be excessive, so that we must continue to press for it to be reduced by action outside the Treaty; we should also enquire if the Australian and New Zealand Governments would be prepared to make simultaneous approaches with us to the United States Government on these lines.
Foreign Office, S.W.1, 30TH JULY, 1951.
H.M. CABINET
GERMAN DEBT SETTLEMENT
MEMORANDUM BY THE SECRETARY OF STATE FOR FOREIGN AFFAIRS
In my memorandum of 24th May (C.P. (51) 139) on the German Debt Settlement, I circulated to the Cabinet copies of documents which, in agreement with the Governments of France and the United States, were being sent to a number of other Governments and to private creditor groups with an interest in the settlement of German external debts. These documents, which were distributed on 24th May, were intended to form the basis for consultations during the Summer by the Tripartite Commission on German Debts, which had been set up to represent the three Governments, with the German Federal Government and with creditor interests in France, the United Kingdom and the United States. The consultations, which were to deal with Germany's pre-war debts, were planned to facilitate the exchange of views and the exploration of the various issues in preparation for a full conference in the Autumn with representatives of all countries with a significant interest as pre-war creditors of Germany. My colleagues may wish to know what steps in this procedure have so far been taken.
2. In accordance with the arrangements outlined in the documents, and after some preliminary exchanges of views in Bonn at the beginning of June with a delegation of the German Federal Government, the Tripartite Commission on German Debts has held a series of meetings in London.
3. In the first place, from 25th June to 3rd July, the Tripartite Commission held preliminary meetings with representatives of creditors from the United Kingdom, France and the United States in the presence of observers appointed by the Governments of the four other countries with a major creditor interest, namely, Belgium, the Netherlands, Sweden and Switzerland. These meetings with creditors only served to clarify the issues which required discussion and to enable the different creditor groups to make contact with each other and to reach a considerable measure of mutual understanding.
4. Then, between 5th July and 17th July, a preliminary conference on German Pre-war Debts took place, at which the Tripartite Commission received a delegation of the German Federal Government and representatives of the German debtors, as well as representatives of the creditors and the observers already referred to. The conference adopted, with little modification, an Agenda drawn up by the Tripartite Commission and organised itself in a series of Committees to study the points on this Agenda on which papers had been prepared by the Tripartite Commission. A copy of this Agenda is attached as an Annex. In these Committees representatives of the Tripartite Commission, of the German Delegation and of the creditors were able to get a clearer understanding of the scale of the various kinds of German pre-war external debts, to narrow down somewhat the issues on which decisions will be needed at a later stage, and to produce agreed papers describing these issues and in some cases setting out the preliminary views of the creditors and of the German Delegation on the solutions to be found.
5. This conference was intended to be of an exploratory character only, and it can be regarded as having fulfilled its purpose. It has brought into the open the points on which the main difficulties will arise in negotiating a settlement plan, and by doing so has facilitated the task of the Tripartite Commission in preparing for the full conference in the Autumn at which many other countries will be represented. The Tripartite Commission is now engaged in considering the results of these preliminary meetings and in preparing for the Autumn conference, the date of which will probably be in early November. Its aim in doing so is to ensure so far as possible that the settlement plan which will be worked out in the course of the Autumn conference will be consistent with the general principles already laid down by the three Governments. The main elements in these principles are that the plan should contribute to the normalisation of economic relations between Germany and other countries, that it should provide fair and equitable treatment of the various interests affected, and that it should not dislocate the German economy or add appreciably to the financial burden on any Occupying Power.
6. In addition, I should like my colleagues to be aware of two other questions which, though not on the Agenda of the recent conference, nevertheless, I understand, occupied an important position in the thoughts of some of the delegates, and in the case of the first of the two questions necessitated a good deal of discussion.
(a) Treatment of German External Assets
In accordance with the Paris Agreement on Reparation from Germany of December 1945 and other intergovernmental agreements flowing from it, former German assets in Allied countries and in a number of neutral countries have been or are being liquidated and the proceeds dealt with in accordance with decisions of the Allied Governments concerned. The German Delegation to the recent conference made it plain that the German Federal Government wished to bring the question of the treatment of these assets, and also possibly of assets removed from Germany under the dismantling programme, into the discussions on the debt settlement. Its aim appeared to be to link the two subjects in such a way as to reduce by some method, the nature of which was never made clear, the amount of the outstanding debts which had to be dealt with. The Tripartite Commission, while admitting that the loss of German external assets might affect in some degree Germany's future capacity to make payment on its external debts, firmly refused to discuss the principle of the treatment of these assets, which, it emphasised, had already been settled by the relevant intergovernmental Agreements and was outside their terms of reference. The matter was not taken further at the conference, but it is probable that the German Federal Government will raise it again at a later stage.
(b) The settlement of Germany's debts to the Allied Governments for economic assistance furnished since the war
The amounts claimed by the three Governments have been communicated to the German Delegation, but as the London Conference was concerned only with pre-war debts there has not so far been any discussion with the German Delegation about the arrangements to be made for settling the post-war debts. The German Delegation pointed out that the nature of these arrangements must clearly affect any German proposals which might be made in regard to pre-war debts and urged that there should be discussions on the post-war debts before the Autumn Conference. It is the intention of the Tripartite Commission that there should be such discussions, but before they can be held the three Governments will have to agree on the settlement arrangements for the post-war debts which they would be prepared to accept. The problem involved is now being studied with a view to its being submitted to my colleagues in due course.
H. M.
7th August, 1951. ANNEX
AGENDA ADOPTED AT PRELIMINARY CONSULTATIONS ON PRE-WAR GERMAN DEBTS
1. Examination of data on German pre-war external debts.
2. Technical questions: — (a) The problem of debts not strictly classifiable as external. (b) Debts of corporate bodies to be considered as constituting liabilities of the Reich. (c) German responsibility in respect of Austrian debts. (d) The problem of the Konversionskasse. (e) The problem of the Verrechnungskasse. (f) The Prussian debt. (g) The Gold Clause problem. (h) The external debts of Berlin. (i) The position of the Dawes and Young Loans.
3. Points of principle: — (a) The question of German ability to pay. (b) The contractual arrangements to put an end to Germany's default. (c) The problem of adjustment for changes in the economic situation of Germany. (d) The question of settlement of foreign currency claims in Deutschemark. (e) Problems arising from any discrepancy between the ability of debtors to pay Deutschemark and German ability to transfer. CABINET
COUNCIL OF EUROPE
MEMORANDUM BY THE SECRETARY OF STATE FOR FOREIGN AFFAIRS
I circulate herewith for the information of my colleagues the text of a statement which I made in a restricted session of the Committee of Ministers of the Council of Europe in Strasbourg on 3rd August, in an endeavour to promote a more robust and energetic attitude on the part of certain of the Continental Governments.
The statement was generally well received. M. Schuman thanked me for my analysis of the successes achieved by the West in the last year and for the tone of confidence of my remarks, which he said he shared. Dr. Adenauer, the German Federal Chancellor, said that this statement dispelled any idea that Great Britain might be adopting an attitude of reserve towards Europe.
My remarks were followed by a statement by M. Stikker on lines previously agreed upon between him, M. Schuman, M. Lange and myself, propounding the need for a new initiative by the European Powers designed to secure increased production for defence. As a result of this statement it was agreed that the Organisation for European Economic Co-operation (O.E.E.C.) should be invited to prepare a draft Declaration which could be issued at a further ministerial meeting towards the end of August. A draft already prepared by M. Marjolin, Secretary-General of the O.E.E.C., will form the basis for this text.
My announcement to the Joint Committee that the Chancellor of the Exchequer would be willing to introduce the O.E.E.C.'s Annual Report to the Consultative Assembly in October next was very favourably received. There is no doubt that this is regarded as a step forward by His Majesty's Government in their relations with the Council of Europe and as a mark of our desire to make full use of the Consultative functions of the Assembly.
We were concerned in the Joint Committee with a proposal by the Bureau of the Assembly that among the subjects to be placed on the agenda for the forthcoming meeting of representatives of the Assembly with representatives of the United States Congress should appear an item headed "Defence" with a number of controversial sub-headings on strictly defence matters, including German rearmament and the European Army. The Committee of Ministers were unanimous in considering that it would be improper, having regard to the Statute, for the subject to appear on the agenda in this form, and the Assembly representatives eventually agreed that the items relating to defence and the economic state of Europe should be merged in a new item headed: "The Economic and Political State of the Western World," from which the sub-heads on defence questions to which the Ministers had objected would be dropped. The new item includes as a sub-head the economic, social and moral impact of the rearmament programme.
The Ministers agreed that the O.E.E.C. Secretariat should be asked to provide material for the use of the Assembly representatives in their discussion with the Congressmen on these points.
41084—1 Finally, I circulate for information a record of a statement made by the German Federal Chancellor at a small dinner party given by M. Stikker on 3rd August at which there were present the French, Netherlands and Norwegian Ministers for Foreign Affairs, the Belgian Minister of Trade and Commerce, the Italian Under-Secretary of State for Foreign Affairs (Emigration) and myself. The second part of the statement, dealing with German views on the Soviet threat and on the question of a German contribution to Western defence, will, I think, interest my colleagues in the light of the Cabinet's recent discussions on this subject. The remainder contains some interesting comment on the internal situation in Germany.
H. M.
*Foreign Office, S.W. 1,*
16th August, 1951. I entirely agree with the view expressed by a number of my colleagues that, when we have these meetings of Foreign Ministers, we should take the opportunity to exchange views on the general situation. It is not easy for us to fit in all the engagements which crowd upon us in these days and I do not think it is necessary to arrange special meetings for this purpose. Far better make use of occasions such as this when we are assembled for other reasons. This has also the advantage that less attention is drawn to such discussions and we avoid arousing the expectation that positive or striking decisions are to be taken. I think such exchanges can only be really useful if they are strictly confidential and not intended to be the subject of any communique, and I also think that they must be regarded as happening outside the strict orbit of the Council of Europe, so that, if we wish to do so, we can exchange views on a wide variety of matters without prejudicing the principle, to which as you know the British Government—and several other Governments—attach importance, namely, that defence is outside the scope of the Council of Europe.
On this basis I am glad to have the opportunity of giving my colleagues a brief outline of how I see our situation at the present time: the problems which concern us for the future and the measures which we must take individually and in common for the safety and welfare of our peoples.
In the course of my remarks I shall try to convey to you the sense of balanced and assured confidence which animates the British people at the present time despite all the clouds on the horizon, and which I am sure ought to be shared by the rest of us in Europe. In any case, as confidence is said to be infectious, I make no apology for speaking of our confidence.
I think on the whole we can say without any doubt that we have had a successful year, and I am speaking of Europe as a whole and of the West as a whole. Our general calculations and the policies which we have based on them, have proved themselves correct. We have all known for a long time that these were going to be dangerous years and that between the moment when we first recognised the need to strengthen ourselves and the moment—unfortunately still some way ahead—when we can regard our defences as adequate, there would be severe tests on our nerve and courage. Each step we ourselves have taken to strengthen our community has been fraught with a certain amount of risk; and of course each time we have had to stand firm against moves by the other side, we have also taken a risk. But we have faced these risks, and we have proved justified. We find ourselves here, towards the end of 1951, with quite a series of successes behind us, with unimpaired unity and steadily growing strength. Western Europe has lost no ground since the fall of Czechoslovakia in 1948 and no one has dared to interrupt us in our measures of defence and of resistance. On this, I certainly think we can congratulate ourselves; and from this we can draw lessons as to how we should behave in the future.
To be more specific: our main successes in the past year—apart from the successful resistance to aggression in the Far East—have been:
First: our refusal to be divided by the efforts of Soviet propaganda or deterred from what we know to be necessary for our independence and freedom. (And I must mention as a particular instance the success with which the West avoided being divided over the negotiations for a Foreign Ministers Conference.) It was not easy, as my French colleague knows and as my United States colleague knows;
Second: the establishment of a joint Command in Europe under one of the most widely respected figures of our time, and the increase of Allied forces on the Continent; and
Thirdly: the substantial start which we have made with the financial and industrial problems inseparable from any defence effort.
In another realm of ideas, we must—as Europeans—congratulate ourselves on the continuing and even increasing interest which the United States Government... and people have shown in the security and welfare of Europe, and their continued recognition—despite many temptations to the contrary—that Europe is the key to the defence of the free world and must have priority over other theatres. This is of vital importance to us all. It is not so long ago that we were wondering whether, as Marshall Aid tapered off, we should be able fully to retain the material and moral support of the United States. We have done so in the fullest sense.
And, finally, we have continued to be successful in building up understanding and co-operation amongst ourselves. We have done our international work in Europe with growing confidence; and little by little it has become less easy in a hundred ways for individual countries to adopt selfish or sectarian courses where the common interest is involved.
We have welcomed the German Federal Republic into the Council of Europe; we have acted in many fields in concert with the O.E.E.C. which, among other activities, brought into successful operation the European Payments Union and this has rendered possible a great increase of inter-European trade; we have seen an independent Yugoslavia steadily affirm itself and its relations with the rest of us gradually improve; we have been conscious of a very definite European point of view emerging in matters relating to peace and war in the Far East and elsewhere; we have seen the normalisation of diplomatic relations with Spain.
To each of these things which I have mentioned, some of us—or several of us—may feel inclined to make reserves, I know. But the point is that if we look at the situation as a whole, the current has been towards reconciliation in Europe, and this current is still in full flow. In my opinion it does not matter if the forms and constitutional structure of union are not so far advanced as some might wish, so long as the reality of our relationship moves towards unity.
In fact, if I may say so, I think that a lot of us, especially here in Strasbourg, pay far too much attention to the forms and too little to the reality.
The main emphasis, then, in all the aspects of our present problem should be on unity. Subject to proper and necessary clashes as to political and economic ideals, unity at home between the different groups and classes of our free society (subject to proper and necessary clashes as to political and economic ideals); unity of action and mutual comprehension amongst the diverse national and international groups which make up the free world. I want to say something about both these two forms of unity.
First, as regards the sociological essentials of internal unity, the task is to create a balanced, just and contented society in which communism will find no appeal and whose natural vitality and cohesion will prevent its being infiltrated by dictatorial doctrines. To get this we must have social justice and fair sharing of economic advantages, and we must have the internal discipline sufficient to ensure these things. But at the same time we must have liberty also. I do not know how the requirement can be better expressed than in the words which inspired the French Revolution, “Liberty, Equality and Fraternity,” provided we give a new meaning to the words “Liberty” and “Equality” and relate them to the conditions of the twentieth century. Fraternity is a constant in human desire and perhaps needs no redefinition.
Now it is in the redefinition of equality that I venture to think Great Britain to-day has something to offer. Frequently we are called upon by good friends to give Europe a lead and equally often we are told that we are not giving this lead. Well, perhaps it would be a good thing to have a careful look at this matter, in which, I maintain we are giving a very definite lead which we invite—indeed are challenging—all to follow. I mean in the elimination of communism at home by the creation of conditions where it does not flourish. There is no easy recipe for this. It is not so easy, anything like, as setting up an international authority or calling together a European parliament, even though these may be more high-sounding. It is a question of social discipline, of having an adequately controlled and efficient fiscal and economic system, of sacrifice by the privileged and some austerity for all. It is a question of social discipline, of having an adequately controlled and efficient fiscal and economic system, of sacrifice by the privileged and some austerity for all. It is a question of ensuring the right and the duty to work, that is to say, of maintaining a policy of full employment together with the principle of full social obligations; it requires a colossal effort on the part of a nation and at the same time great patience and care to combine control with liberty. Politically it demands stable parliamentary institutions and a general respect for government. But the reward is worth working for—a free country to which all classes are equally loyal. We cannot be satisfied with the state of Europe, nor can our defence efforts give us any real assurance of security, until we have eliminated the material and emotional causes of communism in our midst. I would go further and say that you cannot expect to see constitutional union in Europe until all the countries have more or less equally succeeded in eliminating these internal weaknesses. Unity, in fact, like many other desirable qualities, begins at home.
So that is the trumpet which I intend to blow next time I am asked that Britain should give a lead.
In international affairs there are other kinds of unity. I suppose we should all agree that the over-riding thing is to maintain unity between Europe and the North American continent and that one of the most dangerous things that could happen to us, apart from the spread of Communist doctrine itself, would be any growth of anti-American feeling amongst our own people, or anti-European feelings among the Americans. We all have a responsibility for watching this at both ends. In the United States we ought to consider that the good reputation of any one of us enhances the good reputation of us all, and that we all suffer if there is criticism of any one of our European nations. The true European spirit is to show a certain loyalty to one another when dealing with a wider audience, and I can assure you that you will not find British official spokesmen, if I can help it, criticising other European nations in the United States.
As regards European opinion, there may be occasions when we can offer advice to the Americans themselves on how certain aspects of their policy and actions might be better presented from the European point of view. In one matter, in particular,—publicity—it will certainly be right for us as Europeans to be the judges of how best to present our common policies in our own countries, and this is a principle on which we have insisted in the North Atlantic Treaty Organisation. Then again, in certain political matters we have been right to make our specifically European difficulties known, and I think we should continue to do so. We also have a common interest in ensuring that there shall be broad equality of sacrifice over the whole Atlantic community in meeting the dangers which threaten the West; in other words, that the contributions of all shall bear relation to their capacity. This does not mean that any one of us can go easy and rely on others to make up for our slackness. This principle, too, has been accepted in the North Atlantic Treaty Organisation, but I mention it here because it seems to me to have a wider application. Generally speaking it is an essential interest of us all as Europeans that the standards of sacrifice and effort which are applied to us should apply equally over the whole of the Atlantic area and that we should not allow ourselves to get into a position where Europe, so to speak, sits on one side of the table and the North American continent on the other. We are aiming for a community of the West; a joint enterprise in which the sacrifices and the benefits are equally shared.
The second field in which unity must be preserved and in which the United Kingdom Government has a particular responsibility is the sterling area combination, and, closely associated with it, the British Commonwealth of Nations. I do not think anyone will deny the importance of maintaining these combinations or disagree that the United Kingdom Government and people must set aside a large part of their energies and resources to that end. It is not only a question of the economic and financial importance of the sterling area; there is also the fact that the Commonwealth represents one of the main ties linking free Asia with the West and may consequently play a vital part in preventing the spread of communism throughout the whole of Asia. It would be a big mistake to ignore or underrate this part of what we are trying to do for the unity of the free world.
Thirdly there is unity in Europe. I have already spoken about the strong current of reconciliation and co-operation which is bringing us closer together every day in all our affairs, but I want now to say a word about the more specific proposals for setting up institutions of a supranational character which are under discussion in Europe to-day. I mean, of course, primarily the Schuman Plan and the plan for a European Army, though there are other proposals of a similar nature which have not yet reached so advanced a stage. I want to make it clear that the United Kingdom Government have nothing but goodwill towards schemes of this kind, which are designed to bring together in specific fields certain European countries who feel disposed to unite in this way. The fact that, for various good reasons, we do not at present feel able to join such organisations should not be taken as implying any opposition to them or any reluctance to see them succeed. We want them to succeed, and as we have made clear in public statements, we shall always be ready to examine the possibility of being associated as closely as possible, and of co-operating in the most practical way with any authorities which emerge from these schemes. It is to be anticipated that one such authority may emerge from the Schuman Plan Treaty as soon as this is ratified by the Parliaments concerned, as we hope it will be.
As regards the European Army, I would like to say that we have been following with close interest the progress of the Conference in Paris and are now studying the interim report which has been produced. Clearly there are a large number of important questions, especially on the military side, which have still to be cleared up, and it will be necessary to ensure that the whole plan fits in with the requirements of North Atlantic Defence and is acceptable to the Supreme Allied Commander in Europe. Subject to that, however, I can say that we wish the Conference success and shall look forward to hearing how its further studies progress.
These then are the four main areas in which we must cultivate unity; unity based on social justice at home; unity amongst the Europeans; unity of the whole European and North American community, and the ties of the Commonwealth, especially with Asia. They are four aspects of the struggle for the survival of what we loosely call "the West" or the "free world," and so long as we cultivate them all and neglect none of them, we shall certainly win through. No single one is valid without the others, but all are complementary to one another. If we keep these realities before us, there ought to be no difficulty about surmounting the problems of defence, the problems of inflation and raw materials shortages or any of the physical or moral problems which may confront us. But we must work, we must have more production and more equal sacrifice. A greater economic effort would itself improve morale by giving our peoples the feeling that things are on the move, and the more speedy and effective are our preparations of defence, the more certain is the maintenance of peace. Therefore, while we keep our eyes open for any chance of a settlement with the Soviet Union, we must redouble our national efforts for defence. I am not one of those who despair of any settlement with Soviet Russia; I think it may be possible when they realise that we are strong enough not to be pushed around. You will have seen recently various signs which suggest that there might be a new policy in Russia. There has been the move for a cease-fire in Korea, and the publication of an English language paper in Moscow, which seems to speak of the possibility of understanding. It is tempting to be encouraged by these things. But if you look at the reply which Pravda has made to my message, you will see that when it is a question of something which is going to be read widely inside Russia, there is no real abandonment of hostility towards us. I think the Pravda reply, by Communist standards, was fairly mild; but it does not suggest any real attempt to open up, or to remove the misunderstandings which have been wilfully built up in the Russian peoples' mind about the West.
So I say we must wait for deeds as well as words, and we must not lower our guard until we see the real evidence of conversion and of a will for friendship. If we were to relax our efforts prematurely, we should be guilty of betraying the cause of peace. Each nation must concentrate on its own contribution and its internal morale and self respect, and we must not be diverted from this.
We must have confidence in ourselves and our peoples, we must ensure that everybody's heart is in the job and that the civilisation which we are defending is a just and acceptable civilisation, worthy of being defended and genuinely based on the eternal principles of liberty, equality and fraternity. STATEMENT BY THE GERMAN FEDERAL CHANCELLOR AT MR. STIKKER'S DINNER PARTY AT STRASBOURG ON 3RD AUGUST
The Ministers present were:—
Mr. Stikker. Mr. Morrison. M. Schuman. M. Lange. Dr. Adenauer. M. Meurice (Belgian Minister of Trade and Commerce). M. Dominedo (Italian Under-Secretary).
Mr. Morrison was accompanied by Sir E. Hall-Patch and Mr. Shuckburgh and the other Ministers had one adviser each.
Dr. Adenauer, whose remarks were translated into English by Dr. Hallstein and into French by M. Schuman, spoke from a prepared text.
He began by saying that the German people were not properly understood abroad. There was mistrust in certain countries of democratic Germany and this mistrust was, of course, fed by the reports (which were often exaggerated in his view) of the activities of the Socialist Party of the Reich under Herr Remer and of the various ex-soldiers' parties. People seemed to be afraid that if Germany were given arms she might use them to side with Soviet Russia against the West, or demand the unification of Germany by force, or seek a position of hegemony over the other European peoples. Dr. Adenauer said that he proposed to speak very frankly and openly, not as Chancellor but as a German who was deeply interested in creating a new Europe into which the German people would be securely integrated.
He said that to understand the present position in Germany one must know something of the deep psychological and social upheavals which had occurred since 1918. There had never been true democracy in Germany before 1918, since the German Empire had been dominated by Prussia and under the Prussian system the mass of the people had no political influence. The transition to a democratic constitution in 1918 had been too sudden and there had been no chance for democratic practice to grow before the inflation which "proletarianised" the middle classes. Out of this had been built the evil system of nazism, and when this collapsed in the Second World War all authority except purely local authority was destroyed in Germany.
The victorious Allies unfortunately had not taken the necessary steps after the war to win Germany for the West. It was not until 1947-48 that Germany had been allowed to start out on the path of economic recovery. The result was a state of acute insecurity and fear for the future. This was the atmosphere in which the Remer Party had been created. It must be carefully watched by the German Federal Republic though he did not consider it a dangerous movement at present. It was natural that there should be some relics of nazism still lingering in the German mentality and the Russians were the first to avail themselves of this. The Socialist Reichspartei was financed by the Soviets and its head was a Russian tool. The German Federal Government unfortunately could not give proofs of this to German public opinion without giving away their sources of information, but he could assure the Foreign Ministers present that he had photographs of cheques paid to the party by the Russian Occupation Authorities.
As regards the soldiers' associations and the various meetings and speeches to which so much attention was given in the foreign press, it was necessary to take account of the following factors. The desire of former soldiers to club together in such associations after a calamitous war was in itself quite natural and existed in other countries; but in Germany the Army had been defamed and its honour impugned after the war. It had been blamed for all the crimes committed by the Nazis and by a very small element in the Army. The higher officers, many of whom were decent people, had been treated with great lack of psychological understanding and justice. They had been put to manual work regardless of their rank. He personally had known cases of senior officers who could hardly keep themselves alive by manual labour and there had been numerous suicides. The war crime trials, comprehensible in the heat of passion immediately after the war, had been spun out and there were several hundreds of prisoners still in a certain Western country for whom no trial had been arranged. Despite all this, there would probably not be very strong feeling amongst former German soldiers, and in any case it would have gradually disappeared, had it not been for the suggestion of a German contribution to Western European defence. The possibility of creating German forces again had stirred up the ex-officers, and many of them thought—wrongly—that they would have a better chance of participating in the new forces if they took a lead in the military associations. That was why these associations had sprung into prominence recently. Unfortunately, Germany had 2,000 former generals. There was great rivalry between them and this led, he admitted, to unsuitable and improper expressions and actions. This would pass, but it was important not to let these elements become enemies of the State, which, he was glad to say, they were certainly not at present, except for the Bruderschaft. There were no disquieting National Socialist tendencies except in this one group which, as he had said, was closely linked with the Soviet Occupation Authorities.
Another great danger for Germany was the refugees, the “expellees” and the homeless victims of bombing. Shortage of houses was a much greater danger to democracy in Germany than the activities of former officers, and would remain for years one of the heaviest responsibilities of the Government.
Dr. Adenauer then turned to the Soviet threat. He said that the Soviets had taken over the expansionist policy of the Tsars, but that since they were able by the Communist system to co-ordinate all the forces of the nation they had a much better chance than the Tsars of overthrowing Europe. Their principal aim, in his opinion, was to absorb the German Federal Republic in the Soviet system. All other aims were subordinate to this. If they could obtain the industrial and human potential of Western Germany, then all Europe would be at their mercy; the United States would cease to take the same interest in European defence and the fate of Western civilisation would be sealed. The Soviets desired to attain this end first by cold war methods and primarily through the activities of the Communist Party. Generally speaking, the Germans were immune to communism, knowing from their prisoners of war and “expellees” what communism means, so the Soviets were trying to weaken German resistance by supporting right-wing radical groups and by creating fear. He did not think that the people in Western Europe had any idea how damaging to the psychological resistance of the German people was the fear created by the 25 to 30 heavily armoured Communist divisions in the Soviet Zone. When people were woken in the night by the passage of Allied transport through the streets their first thought was that the Soviet tanks had arrived, and even the sound of friendly aircraft overhead reminded them of this ever-present terror. The Soviet Union knew that so long as Western Germany was demilitarised it would be only a question of time before it fell into the Soviet sphere. The Allied Occupation troops would not always be sufficiently strong. “To neutralise or demilitarise Western Germany by treaty, and prohibit her from protecting her neutrality with her own forces, would be absolutely fatal. This idea, which has been advocated by Professor Noack and his friends, is directly attributable to the Russians with whom Professor Noack has direct contacts.” The strong reaction of the Russians to the suggestion of a German defence contribution showed that they recognised that it would involve the integration of Western Germany with the West and thus end the prospects of absorbing her into the East.
Dr. Adenauer said he thought the present tensions with the Soviet Union would probably subside without a shooting war, but that there would remain a constant threat from Russia, who was now firmly established in the heart of Europe and whose pan-Slav and totalitarian traditions would compel her to expand whenever opportunity arose. The United States would not for ever keep troops in Europe, and Europe itself must therefore take lasting and effective measures against Soviet expansionism (with such assistance as the United States might offer). This was only possible if Europe was genuinely united. The Pleven Plan was, to his mind, the only possible method of protecting Europe permanently. The North Atlantic Treaty Organisation aimed rather at the present threat and at maintaining peace in the coming years; it would not meet the long-term need.
Dr. Adenauer said that he did not regard the state of Germany as dangerous, though there were elements in it which might become dangerous if not watched. He personally had known cases of senior officers who could hardly keep themselves alive by manual labour and there had been numerous suicides. The war crime trials, comprehensible in the heat of passion immediately after the war, had been spun out and there were several hundreds of prisoners still in a certain Western country for whom no trial had been arranged. Despite all this, there would probably not be very strong feeling amongst former German soldiers, and in any case it would have gradually disappeared, had it not been for the suggestion of a German contribution to Western European defence. The possibility of creating German forces again had stirred up the ex-officers, and many of them thought—wrongly—that they would have a better chance of participating in the new forces if they took a lead in the military associations. That was why these associations had sprung into prominence recently. Unfortunately, Germany had 2,000 former generals. There was great rivalry between them and this led, he admitted, to unsuitable and improper expressions and actions. This would pass, but it was important not to let these elements become enemies of the State, which, he was glad to say, they were certainly not at present, except for the Bruderschaft. There were no disquieting National Socialist tendencies except in this one group which, as he had said, was closely linked with the Soviet Occupation Authorities.
Another great danger for Germany was the refugees, the “expellees” and the homeless victims of bombing. Shortage of houses was a much greater danger to democracy in Germany than the activities of former officers, and would remain for years one of the heaviest responsibilities of the Government.
Dr. Adenauer then turned to the Soviet threat. He said that the Soviets had taken over the expansionist policy of the Tsars, but that since they were able by the Communist system to co-ordinate all the forces of the nation they had a much better chance than the Tsars of overthrowing Europe. Their principal aim, in his opinion, was to absorb the German Federal Republic in the Soviet system. All other aims were subordinate to this. If they could obtain the industrial and human potential of Western Germany, then all Europe would be at their mercy; the United States would cease to take the same interest in European defence and the fate of Western civilisation would be sealed. The Soviets desired to attain this end first by cold war methods and primarily through the activities of the Communist Party. Generally speaking, the Germans were immune to communism, knowing from their prisoners of war and “expellees” what communism means, so the Soviets were trying to weaken German resistance by supporting right-wing radical groups and by creating fear. He did not think that the people in Western Europe had any idea how damaging to the psychological resistance of the German people was the fear created by the 25 to 30 heavily armoured Communist divisions in the Soviet Zone. When people were woken in the night by the passage of Allied transport through the streets their first thought was that the Soviet tanks had arrived, and even the sound of friendly aircraft overhead reminded them of this ever-present terror. The Soviet Union knew that so long as Western Germany was demilitarised it would be only a question of time before it fell into the Soviet sphere. The Allied Occupation troops would not always be sufficiently strong. “To neutralise or demilitarise Western Germany by treaty, and prohibit her from protecting her neutrality with her own forces, would be absolutely fatal. This idea, which has been advocated by Professor Noack and his friends, is directly attributable to the Russians with whom Professor Noack has direct contacts.” The strong reaction of the Russians to the suggestion of a German defence contribution showed that they recognised that it would involve the integration of Western Germany with the West and thus end the prospects of absorbing her into the East.
Dr. Adenauer said he thought the present tensions with the Soviet Union would probably subside without a shooting war, but that there would remain a constant threat from Russia, who was now firmly established in the heart of Europe and whose pan-Slav and totalitarian traditions would compel her to expand whenever opportunity arose. The United States would not for ever keep troops in Europe, and Europe itself must therefore take last and effective measures against Soviet expansionism (with such assistance as the United States might offer). This was only possible if Europe was genuinely united. The Pleven Plan was, to his mind, the only possible method of protecting Europe permanently. The North Atlantic Treaty Organisation aimed rather at the present threat and at maintaining peace in the coming years; it would not meet the long-term need.
Dr. Adenauer said that he did not regard the state of Germany as dangerous, though there were elements in it which might become dangerous if not watched. The Government would have to undertake tremendous work in the social field and to oppose nationalist and neo-Nazi trends. They must take especial care to attract the youth. Unfortunately the German State at present had no attraction for the youth, not being fully sovereign and having no glamour. It was necessary that the German Government should acquire sovereignty as quickly as possible, so that the inhabitants might learn to respect and love it. The Allies could assist in this and thus strengthen democratic ideas in Germany.
If there were to be a German contribution to Western defence, the selection of higher officers must be done with the greatest care. He would appoint only those officers who were strictly reliable, faithful to the democratic constitution and not involved in politics. “We are quite aware that we must select officers with the greatest possible care. We do not in any circumstances want to encourage undesirable developments. Thus, in the discussions on the Pleven Plan and in supplying information to the Allies at the Petersberg talks, I put in charge a man whom I regard as absolutely reliable—Herr Blank—who is one of our younger trades unionists and who understands fully my own intentions. I should never give supreme authority in this field to a soldier.”
Nowhere was the European idea so popular as in Germany, Dr. Adenauer concluded. The Germans always needed an ideal to follow. History had destroyed their dreams of a Greater Germany and the ideal of a united Europe now provided the only possible alternative. The European idea was particularly attractive to the Germans because they knew of the Soviet threat and the Soviet terror, and the vast majority of them would be ready to contribute immediately and permanently to a European system of defence. This would involve no threat of a revival of nationalism.
But if Germany were not soon given sovereignty and integrated into the West through a defence contribution it might well become a prey to Soviet expansionism.
Mr. Stikker, speaking in German, thanked Dr. Adenauer for his remarks, which, he said, had given his colleagues plenty of food for thought. He did not consider, in view of the lateness of the hour, that there could be any discussion, but he hoped that similar opportunities for informal exchanges of view would occur on future occasions. CABINET
THE MAN-POWER POSITION ON THE BRITISH RAILWAYS
MEMORANDUM BY THE MINISTER OF TRANSPORT
At its meeting on 26th July the Cabinet invited the Minister of Defence to arrange for officials to examine urgently the proposals which I put to them in my paper C.P. (51) 215 of 19th July, that, as an alternative to deferment, railwaymen called up for National Service should, after basic training, be returned to the railways on reserve (C.M. (51) 55th Conclusions, Minute 5).
2. This examination has now taken place and I understand that these proposals are unacceptable to the Service departments, partly because existing training resources are inadequate for the purpose and partly because the training period, if it were long enough to be of any value to the Services would be too long to enable any substantial help to be given to the railways. I understand that, in fact, the Services would regard this alternative to deferment as worse than deferment itself, and that the Ministry of Labour and National Service do not consider that it offers advantages over deferment in meeting their particular difficulties.
3. I must therefore ask my colleagues to give further consideration to my request for a limited measure of deferment as set out in my previous paper. The total number for whom deferment is thus sought is about 2,900. When I submitted my previous memorandum this was made up of firemen (1,162), the promotion grades for firemen, guards, shunters and signalmen (1,645) and permanent-way, signal and telegraph maintenance staff (69). These figures will have altered slightly since then, but remain of the same order.
4. My Department have examined in detail with the British Transport Commission and the Railway Executive the prospects of keeping traffic moving on the railways this winter, and the position is serious. The number of vacancies in the railway footplate staff in areas of acute shortage have increased from over 3,800 at the beginning of the year to over 4,700 at the end of June. There is no reason to expect any improvement in ratio of staff recruitment to wastage during the autumn and winter when working conditions worsen. At the end of June, 225 booked freight trains were cancelled daily because of staff shortages, and work in the marshalling yards was seriously slowed down by lack of crews for shunting engines.
5. In consultation with the National Coal Board, the railways have planned for a maximum diversion of coal to road and coastal shipping, but even so, they expect to have to move an additional million tons of coal alone in the 16 weeks beginning 10th September. There are increases to be expected in other traffics.
6. The Railway Executive are planning cuts in passenger services of varying orders of severity. These cuts are, of course, useless unless they throw up men who can be used in the areas of traffic congestion, and they must therefore be planned with care if useless injury to the country's travel is to be avoided.
7. If no relief can be given from their man-power obligations to the Services, the Railways will have no alternative but to cut passenger services to a standard generally below that obtaining during last winter's coal shortage. In addition, they would find it impossible to run some 500 to 600 freight trains (including empties) of those they expect to be required daily for the autumn and winter traffic. If priority is to be given to coal, this would mean shutting out some ½ million tons of other traffic each week. Such a position is, of course, untenable. No absolute priority could be given to coal, and the accumulation of traffic at this rate would have a disastrous effect upon the country's economy.
8. I am satisfied, and I think the Minister of Labour and National Service will support me, that the Railways are doing all they can to meet their difficulties from their own resources. It is unnecessary to recapitulate their difficulties. I am bound to say that I do not think they are getting all the help they should from the Unions, but even if the latter could be brought to agree to a more efficient use of footplate staff, it would not go very far to meet current difficulties.
9. If a breakdown this winter is to be avoided, I can see no alternative but to agree that the Railways should be allowed to retain the men they have in the areas where they are so short. This will do something to alleviate matters, and, in conjunction with the special measures which the Railways are themselves taking, will, I hope, prevent acute trouble. Serious operating difficulties will undoubtedly remain and a long-term solution of the man-power problem has yet to be found.
A. B.
Ministry of Transport, W. 1, 3rd September, 1951. CABINET
GERMAN DEFENCE CONTRIBUTION: ECONOMIC AND FINANCIAL IMPLICATIONS
Note by the Prime Minister
I circulate for the consideration of my colleagues a report prepared by an interdepartmental committee of officials on the economic and financial implications of a German military contribution to Western defence.
C.R.A.
10, Downing Street, S.W.1.,
30TH AUGUST, 1951. ANNEX
ECONOMIC AND FINANCIAL IMPLICATIONS OF A GERMAN MILITARY CONTRIBUTION TO WESTERN DEFENCE
REPORT BY THE MUTUAL AID COMMITTEE
1. His Majesty's Government have agreed in principle to the creation of a German military force for Western defence because if Europe is to be safe from enemy occupation it must be defended in Germany, and, because the Allied forces available are inadequate for this purpose, with German military assistance. They have, however, always reserved their right to consider the timing and nature of this contribution (C.M. (50) 59th Conclusions, Minute 1, and C.M. (51) 56th Conclusions, Minute 6). The question of a German military force has now become inextricably associated with the development of our political relationship with Germany in Western Europe. A decision on a German force cannot with safety be deferred much longer without serious political repercussions in Germany itself. Final decisions on these matters may, therefore, have to be made within the next few months and the purpose of this paper is to draw attention to certain aspects other than those primarily of military and political concern of which account must be taken.
2. It has become evident that the raising of a German military force will have considerable economic repercussions both on the German economy and on the economies of the Occupying Powers. This report has accordingly been prepared by the Mutual Aid Committee on the basis of information at present available in order to set out the economic and financial implications, particularly for the United Kingdom, of raising such a contribution to European or N.A.T.O. forces and to indicate the issues on which policy decisions will eventually have to be taken.
The scale and nature of the contribution now being made by Germany to Western Defence
3. Western Germany is already required to provide considerable sums for the maintenance of Allied forces in Germany. These are charged to the German budget on a mandatory basis as Occupation costs even though the function of the Allied Forces has changed from that of an occupying army to that of providing the outer shield for the Western countries against Russian aggression. These costs may be summarised as follows:
| Year | Occupation costs | Mobile police | Total | |----------|------------------|---------------|-------| | 1950-51 | 4.3 | Nil | 4.3 | | 1951-52 | 7.9 | 2 | 8.1 |
4. Thus, in 1950-51 Germany spent between 5 and 6 per cent. of her national income on purposes related to Western defence, and is being called on to pay between 7 to 9 per cent. in 1951-52, although full budgetary provision has not yet been made for expenditure at this rate. The Federal Government has also been furnishing aid to Berlin, which is in the nature of a defence contribution, at the rate of DM. 600 million a year. In addition, some DM. 4-2 milliard is spent on refugees and on the prevention of social unrest, which the Germans consider—although we do not—should also be regarded as part of their contribution to defence.
5. Of the total of Occupation costs for 1951-52, the United Kingdom share is DM. 2-08 milliard, or approximately £175 million. Of this share, however, only £140 million is expended on the maintenance of the British Forces and the Control Commission—a figure which may rise to as much as £180 million by 1952-53 owing to rises in prices and reinforcements. This, broadly speaking, is the measure of the financial interest at stake for the United Kingdom in any new arrangements affecting Germany's contribution to defence.
6. The capacity of the German people to pay Occupation costs at the proposed scale is being increasingly debated in Germany. The German Government and, through it, German public opinion is growing more hostile, especially because of the mandatory nature of the impost. To meet the bill the Allies have presented, increased taxation and economies elsewhere are essential, but the rigidly Federal character of the German constitution, general tax morality and growing resistance to Occupation costs make this peculiarly difficult. An approach from the Federal Chancellor for financial help in some form is to be expected. Thus, even without the complication of the German defence contribution it is not to be expected that we could much longer continue to obtain Occupation costs on the full scale proposed for 1951-52.
Consequences of a German military contribution
7. If Germany has now to make a direct military contribution for which she must be in some measure financially responsible it will affect the situation as it exists at present in three ways:
(i) A German military contribution will have to be paralleled in the political field by the placing of most of the powers at present reserved to the Allies on a contractual basis. It must be assumed that in this process we shall no longer be able to retain our present right to levy charges for the cost of Allied forces in Germany upon the German budget without prior German consent. Since we shall be dealing with a problem of German partnership in Western defence rather than the occupation of Germany by Allied forces, there would indeed be little justification for the maintenance of the present arrangement. The mandatory system, as we know it at present, will, therefore, come to an end.
(ii) It may be anticipated, though it cannot be proved, that it will be easier for the Germans to raise money to support a German military contribution rather than in aid of compulsory Occupation costs. For this reason, and also because of economic progress, it may be assumed that Germany's capacity to pay will increase.
(iii) On the other hand, the cost of the direct German military contribution will clearly fall heavily, particularly during the period of re-equipment, on the German budget; the Germans will claim that it should have a priority higher than that of contributions to the Allied forces, and whatever we may do it may in practice be difficult to ensure that the latter does not have second place.
German capacity to pay
8. The three elements of the Allied High Commission have stated that the best estimate which they can make of German ability to contribute to Western defence in the present circumstances, i.e., in Occupation costs, is DM. 9 milliard. It should, however, be noted that the contribution in its present form does not occasion any industrial dislocation nor any balance of payments problem comparable to that caused by defence expenditure elsewhere. We consider that, if Germany is making a direct military contribution, the provision of at least DM. 10 milliard, rising later to DM. 12 milliard or even more, should not place an impossible burden upon her economy, nor, with proper safeguards, need it lead to inflation with its undesirable financial and political consequences. At the same time, a contribution on this scale would, in terms of percentage of National Income, bear a reasonable relationship to the contribution of, say, the United Kingdom and France.
The cost to the German Budget of a Military Contribution
9. Until agreement has been reached on the size, nature and timing of a German military contribution, estimates of its cost to the German economy are of necessity highly speculative. With every possible reserve as to the resultant calculation we have made certain assumptions under the following heads, based on the discussions between the representatives of the Federal Government and of the Allied High Commission at Bonn, and such preliminary examination of the German proposals as has already taken place. (a) Size
We assume that whether a contribution be made direct to the N.A.T.O. forces under General Eisenhower or through the medium of a European Army, the ground forces will not be allowed to exceed at any time 20 per cent. of the forces at General Eisenhower's immediate disposal, or ultimately approximately twelve divisions, with appropriate tactical air support. We also assume some light naval forces and coastal defence for the Baltic.
(b) Timing
Having regard to the international negotiations which must first be completed, the national planning and passage of legislation required in Germany, and the setting up of training establishments, we have assumed that actual recruitment of the rank and file could not commence before October 1952 and full strength could not be achieved until 1955.
10. Starting from these assumptions we have examined the Germans' own estimates of costs of a military contribution as put forward in the Bonn discussions. These envisaged a total capital, or "non-recurrent," expenditure on arms, equipment, works and buildings, &c., of approximately DM. 20 milliard, and an annual expenditure of DM. 2-2 milliard. We have then sought to estimate the probable cost in each of the three years after 1952 likely to fall on the German economy. We have in our estimates taken considerable liberties with the German figures to accord with our own assessment of probability, of which the most important modifications are:
(i) We have made adjustments to allow for an ultimate force of 350,000 as opposed to the German figure of 250,000, in order more realistically to reflect the man-power requirements of 12 Army divisions.
(ii) We have assumed a smaller air force.
(iii) We have assumed that all heavy arms will be provided free by the United States and made heavy reductions on the German figures to allow for the fact that they appear to be in part based on United States prices and possibly on over elaborate scales of provisioning. This reduces the total German capital expenditure by about two-thirds.
(iv) We anticipate that the expenditure on works and buildings will be spread over four years.
11. As a result we estimate that a possible rate of expenditure by Germany on German armed forces might be:
| Year | 1952-53 | 1953-54 | 1954-55 | |--------|---------|---------|---------| | £ | £100 million | £340 million | £500 million | | or DM. | 1·2 milliard | 4·08 milliard | 5·9 milliard |
These figures are subject to many reservations, but may serve as illustrative of the possible order of magnitude of the costs involved. Expenditure in subsequent years might be at less than the rate for 1954-55 as the initial equipping and construction would have been completed, but we doubt the utility of attempting any estimate so far ahead.
12. The background against which the estimates in paragraph 11 were framed is, however, extremely uncertain. The Germans will, of course, be anxious to increase the strength of their Armed Forces as quickly as possible; they estimated at Bonn, for example, that the whole of the non-recurrent expenditure of DM. 20 milliard would be incurred during the first year of their build-up. American pressure will certainly be applied in the same direction and it may be that our ideas of the relatively low priority on which the Germans should be supplied with heavy equipment from America (with its retarding effect on the rate of build-up of their Armed Forces) will not be accepted by them. To the extent that the Americans are unable or unwilling to supply arms from their own production at the rate which they regard as necessary for the build-up, they might press for the manufacture in Germany of heavy military equipment on the N.A.T.O. prohibited list, and substantial German expenditure might thus arise towards the end of the three-year period covered by the estimates in paragraph 11. It may be too that the Germans will be able to complete their works programme more quickly than we have assumed and that its cost over which we shall have no control will be substantially higher. For all these reasons the rates of German expenditure on their forces given in paragraph 11 may prove to have been considerably under-estimated.
13. If support for the Allied Forces and expenditure on Berlin were to continue at their present scale, and if the cost of the German military effort were added in accordance with our estimate in paragraph 11 the cost to the German budget would be:
| Year | Milliard DM | |----------|-------------| | 1951-52 | 8.7 | | 1952-53 | 9.90 | | 1953-54 | 12.78 | | 1954-55 | 14.6 |
On the basis of these very tentative figures, it could be argued that, allowing for some increase in German national income over the next five years, the Germans could shoulder the whole of this burden. But as has been explained, our estimates may be too conservative, and there will in any event be extreme difficulties in inducing them to make a fair defence effort particularly when the cost of supporting the Allied Forces represents so large a proportion of the whole. We must expect to be under constant and increasing pressure for reductions, and it will require a firm and united stand by the United States, and United Kingdom and France not only to obtain acceptance of the principle of a German payment for the maintenance of Allied forces in addition to a military contribution, but also to collect it year by year. We have therefore found it necessary to consider the consequences of the loss in whole or in part of what is now covered by Occupation costs.
Economic implications for the United Kingdom
14. Any reduction in the amount of our share of Occupation costs paid by Germany will impose an additional burden on the United Kingdom Budget and on our external balance of payments. To the extent that some part of the costs of maintaining United Kingdom troops in Germany ceases to be a charge on the Federal Budget, it must be assumed by the United Kingdom Budget. Furthermore, to the extent that Deutschmarks are no longer available to us free to make payments necessary in support of our forces in Germany, we shall have to pay sterling across the Exchanges. If Occupation costs were to be eliminated and present practice were to continue unchanged, the additional charge to the Budget, and the additional foreign exchange burden, would be approximately £150 million in 1951-52 rising to £180 million in 1952-53. This allows for the increase in United Kingdom forces in Germany now planned, but assumes the payment by Norway, Denmark and Belgium of the cost of maintenance of their contingents now met from our share of Occupation costs. We have therefore made some preliminary analysis of the items which make up this total, in order to indicate where possibilities of economy may lie, and what opportunities exist of substituting sterling for Deutschmark expenditure.
The present Deutschmark Costs of British Forces in Germany
15. About one-third of Occupation costs are spent on German labour, the balance being divided between capital works, transportation, living accommodation and public utilities. Compared with practice elsewhere, the standard of goods and services is high both in amount and cost, because of the mandatory system dating from the earliest days of the Occupation which hitherto has rendered normal financial control on our part unnecessary. But the principal factor is our use of German labour wherever we can. This is in accordance with the general policy applied wherever possible of employing civilians abroad to free Service man-power for training; conditions in Germany have hitherto been particularly favourable to this policy, and have permitted the use of Germans in administrative duties in combatant units, depots, workshops, &c., as an essential and integral part of the fighting services. Thus a total of 75,000 British personnel employed some 175,000 Germans at 31st March, 1951, of whom 141,000 were in support of the British fighting services.
16. There are three possible ways of finding economies:—
(a) The imposition of such economies as would be necessary to make standards comparable with those of other Commands (with reasonable regard to any special conditions in Germany). A number of economies have already been effected. Others are being vigorously pursued and might yield an eventual saving of 10 per cent.
(b) Possible financing of certain costs on an international basis. Any benefit to the United Kingdom would, under present international arrangements, be confined to the major part of airfield expenditure of £3.3 million in 1951-52 and over £9 million in 1952-53.
(c) A major change of policy in the employment of German labour. Any proposal to withdraw the German labour force employed in support of the British fighting services would entail a decision of policy of the first magnitude. To the extent that they were not replaced it would involve a reduction in the effective strength of the British forces in Germany. Their replacement would involve complete reorganisation of the British forces, changes in the distribution of existing man-power resources as between the three Services, and a reduction in the number of fighting units elsewhere, with a consequent material reduction in their fighting efficiency.
Even if the replacement could be effected without increasing the charge on the United Kingdom Budget, the charge on the balance of payments would not be reduced pro tanto, owing to the extra commitments which the accommodation, maintenance, &c., of extra military personnel in Germany would entail.
17. If both administrative economies were carried out and no German labour whatever were employed, with the evident disadvantages attaching to that course, the maximum theoretical saving in deutschmarks would be considerably less than 40 per cent.
Consequences for the United Kingdom Budget
18. While it may in these ways be possible to reduce the costs to the United Kingdom Budget to some extent, the risk remains of a substantial additional charge on the United Kingdom taxpayer which will have to be met either by a reduction in the United Kingdom defence expenditure elsewhere or by an increase in total United Kingdom defence expenditure. This clearly raises a major policy issue. On the one hand Ministers have affirmed (E.P.C. (51) 14th Meeting of 3rd July) that no further load is to be placed on the economy for defence purposes in addition to that necessary for the conclusion of the programme agreed upon in January; this means that (subject to consideration of the effects of any price increases) £4,700 million is the absolute limit of expenditure on defence which the country can stand over the next three years and the developments of the last nine months have made evident the gravity of the burden which this imposes on us. There is no need to emphasise the serious effect of reversing this decision and adding a burden of anything up to £400 million in real resources to the present defence programme. On the other hand, the object of a German contribution to defence is to increase the total forces available to Western defence, rather than to substitute a German effort for some part of our own. If, therefore, the result of any reduction made in our own effort were to reduce or delay our full provision for the N.A.T.O. command, the object would be in some degree defeated.
Consequences to the United Kingdom Balance of Payments
19. The effects on the United Kingdom balance of payments will, of course, depend primarily upon the amount of additional overseas expenditure falling on the Exchequer. If we were to cease to receive Occupation costs altogether, and no economies were effected, the additional overseas expenditure which we had to incur would be at the annual rate of £150 million in the current year, rising to about £180 million in 1952-53.
20. This would be a new and dangerously large burden on our balance of payments. The possible scale of the impact on our external economy would be about the same as the loss of Persian oil; the extent of the measures which would be required to offset it may be illustrated by the fact that the amount involved is equivalent to about 25 per cent. of our imports from Europe, or to about 15 per cent. of our world-wide exports of consumer goods. In particular, the complete cessation of Occupation costs would threaten us with a large and continuing deficit with the European Payments Union, to which we should inevitably have to pay substantial amounts of gold; this situation would incidentally have a seriously weakening effect on our influence in Europe, which, experience has shown, can be effective in economic matters only when our financial position is strong.
21. Conversely, there would be a great strengthening of Germany's external financial position, which would no doubt have an important bearing on Germany's strength and influence in Europe. This strengthening of her position would make it possible for Germany to begin to repay at any rate her post-war external indebtedness, and, if the full amount owing under this head to the United Kingdom could be repaid in three years, we should obtain relief to our balance of payments (and to the Budget) at the rate of approximately £60 million per annum. If the same principle could be applied to the matured portion of Germany's pre-war sterling debts, both Reich and private, further payments of £35 million a year would bring relief to the balance of payments to that extent (but not, of course, to the Budget). None of this could, however, be achieved save by agreement with the Americans and the French and negotiations with the Germans.
22. This balance of payments problem which is brought to light by the discussion of the future of Occupation costs is implicit in the arrangements which require substantial British forces to be maintained on the Continent. The fact that the Germans have been paying these very large local expenditures of our forces, as Occupation costs, has concealed the serious potential burden on our balance of payments which the location of our forces implies. This is precisely the same problem, in the context of the peace-time defence of Western Europe, as led to the great accumulation of indebtedness in World War II for the defence of India, Egypt and the rest of the Middle East.
Elements of a solution
23. It is therefore evident that, on both budgetary and balance of payments grounds, we must seek to avoid the economic effects on ourselves of a German defence contribution by endeavouring to obtain in one way or another a financial contribution to defence from Germany sufficiently large to cover both the military contribution and our essential deutschmark expenditure in Germany. We believe that it is economically possible for Germany to make such a contribution. But whether in practice these objectives can be achieved will turn on the willingness rather than the economic ability of the Germans to carry their financial share of the defence burden, and the firmness and solidarity of the United States, the French and ourselves in pressing for a solution on these lines.
How Germany's Fair Contribution to Defence might be obtained
24. The key to this problem is therefore clearly political. To what extent can we rely on German willingness to make a contribution of the necessary order, how far will the Americans and the French support us, and what means of pressure are available? There can be no doubt that the German Government is in fact anxious to make a military contribution, as it is extremely conscious of the very considerable political advantages which will accrue as a result. But to date they have with some skill contrived to be courted rather than themselves courting this development, and will undoubtedly argue that they should be wholly released from the maintenance costs of Allied troops. It is on the means of pressure that we must therefore rely, and to be effective this must be exerted in concert by the occupying Powers. There is some hope that both our partners will be of similar mind to ourselves. The American military authorities at least will be most anxious not to swell their bill to Congress by the cost of maintenance of United States troops in Germany, and in their draft of the contractual arrangements have stated that the Federal Budget should bear the cost of the defence contribution and the support of Allied Forces in Germany, in that order of priority. The French apparently hope that Occupation costs will continue to be paid under existing arrangements and not placed on a contractual basis.
25. Initially therefore the interests of the three Powers would seem identical, but motives differ. The prime American concern is for a German military contribution to be made as soon as possible, the French for completion of political agreement on a European Army, for which no real financial plans have been laid, while we, though fully alive to defence considerations, must necessarily have the economic effects particularly in mind. Nor are the means of pressure equally shared. In the last analysis our only weapon would be to threaten drastic reduction of our troops, which as the Germans would be well aware, would involve such impossible political and strategic consequences that the threat itself would be ineffective. The French would no doubt reconcile themselves to Occupation costs if they were able to obtain some form of United States aid for themselves to compensate for any increased financial burden on France. Only the Americans have an argument to which the Germans will always be sensitive—the threat of withdrawal of aid. Unless the United States is prepared in the last resort to use this threat to obtain German agreement to an adequate total contribution we can have little hope of a solution tolerable to ourselves.
Commercial implications for the United Kingdom
26. There is a further point which must be borne in mind, although it is of a long-term nature. Having regard to existing limitations on the German rearmament industry, their engineering industry will be relatively free of the heavy burden which rearmament imposes on our own, and their competitive position overseas will consequently be strengthened, which may in turn improve their external position—possibly at our expense. From this point of view and disregarding security considerations there would be advantage if some of the limitations approved by N.A.T.O. on the German heavy armament industry were raised and they were themselves required to manufacture a large part of the heavy equipment which they will require. This, however, would reduce their need for United States end item aid and increase the burden on their own budget, consequently still further reducing the amount which we could hope to obtain by way of support for the Allied Forces. We are here in a dilemma. The greater the United States supplies of arms and aircraft to Germany, the more risk that our own military supplies from the United States needed to complete the equipment of our own forces may be curtailed. But if the Germans manufacture their own arms, not only is their ability to contribute to Allied deutschmark costs reduced, but they cease to be so dependent on the Allied Powers for the means of defence, and may therefore feel able to assert an undesirable independent line. On balance, we conclude that our immediate economic interests, on budgetary and balance of payments grounds, combine with the political factors to require acceptance of the added risks to our overseas markets and the supply of equipment from the United States, implicit in limiting German arms production.
Conclusions
27.—(i) A German military contribution to N.A.T.O. or to a European army raises in acute form the future financing of the cost of maintaining Allied forces in Germany.
(ii) The amount of financial support for our troops in Germany which we shall be able in future to extract from the Germans will depend in the last resort on the willingness of the Germans to provide it and on the timing and cost of their own military force.
(iii) On the assumptions which we have made regarding cost and timing, it should be possible on economic grounds for Germany to meet essential Allied deutschmark expenditure while financing the cost to Germany of the German military force, and in doing so she would probably not be paying more than her fair share for Western Defence.
(iv) These assumptions may, however, prove over-optimistic and it will be particularly difficult to induce the Germans to make a fair defence effort when the cost of the support of Allied forces represents a high proportion of the whole.
(v) Any reduction in the amount of our share of Occupation costs paid by Germany threatens an additional burden on the United Kingdom Budget and our external balance of payments. If we had as a result to shoulder the whole present deutschmark cost of our forces in Germany, the increased budgetary cost would be of the order of £150 to £180 million a year, with a burden on our balance of payments of a similar order.
(vi) It must be our objective to ensure if possible that our essential deutschmark expenditure in Germany is covered by the German contribution, but this is likely to prove very difficult in any event, and particularly if the rate of build-up of a German military force is quicker, its cost higher or American aid less than assumed. (vii) Economics in the United Kingdom expenditure in Germany or some compensating payments of other kinds, e.g., debt settlements would, to the extent they can be realised, mitigate the effect on the United Kingdom Budget and balance of payments.
(viii) Substantial economies could only be made in Germany by a major change of policy in the employment of German labour, which would involve complete reorganisation of the British forces, changes in the distribution of existing manpower and forces as between the three services, and a reduction in the number of fighting units either in Germany or elsewhere. Even these economies could only cover a small part of our deutschmark expenditure.
(ix) Significant relief could be obtained if it proved possible to negotiate agreement both with our Allies and the Germans for full repayment within a few years of Germany's post-war external indebtedness and her matured pre-war sterling debts.
(x) If it should not be possible to secure that our essential deutschmark expenditure is met, the additional burden on our defence programme will necessitate important decisions as regards either the scale of our defence programme or the nature of the economies necessary to keep it within the existing ceiling and at the same time avoid serious prejudice to our balance of payments.
Recommendations
28.—(i) We should seek an early opportunity, in the context of our own economic problems, of impressing upon the United States Administration, the consequences which are liable to result for the Allies from the creation of a German military force. At these discussions in which the French should participate, we should maintain that we cannot accept any additional charge either to our Budget or on our balance of payments. We must accordingly explore with the United States and French Governments means (as indicated in paragraphs (ii)—(v) below) of avoiding this additional charge without prejudice to the common defence effort.
(ii) We should urge that, without prejudice to our own defence programme and that of other N.A.T.O. Powers, the largest possible quantity of heavy armaments and notably military and naval aircraft, which the Germans cannot in any event hope to manufacture for themselves in the early stages, should be provided free by the United States as end-item aid.
(iii) We should seek an understanding from the Americans to make further help to Germany dependent if necessary on satisfactory arrangements for the provision by the Federal German Government of support for Allied forces in Germany which we believe to be fully within their economic capacity.
(iv) We should endeavour to secure tripartite agreement on making the most critical scrutiny of the German figures for equipment and capital expenditure on defence.
(v) We should establish with the Americans that there is a close relationship between any beneficial effects on the German balance of payments of a German military contribution and Germany's capacity to pay foreign debts, but should not pursue any specific proposals in the debt context until the prospect of obtaining from the Germans a fair contribution to the cost of Allied forces in Germany has been assessed.
(vi) At the same time, we should instruct the United Kingdom High Commissioner—
(a) to prepare plans, in conjunction with his United States and French colleagues for all possible reductions of Allied use of capital installations in Germany in order to lower initial German outlay on capital equipment;
(b) to continue to impress upon the Federal Government the need for increased taxation to meet a situation in which a heavier burden than the existing level of Occupation costs will be placed upon the Federal Exchequer;
(c) to explore in the High Commission and at an appropriate time with the Federal Government the possibility of meeting some part of the non-recurrent expenditure by an internal loan.
(vii) Efforts to reduce our own DM. costs in Germany should be intensified, in the knowledge that, unless means other than transfers of sterling can be found of meeting our DM. needs, drastic economies may become necessary.
Cabinet Office, London, S.W.1, 24th August, 1951. WASHINGTON AND OTTAWA MEETINGS: REVIEW OF BRITISH POLICY
MEMORANDUM BY THE PRIME MINISTER
As the Cabinet is aware the Secretary of State for Foreign Affairs proposes, after attending the San Francisco Conference on the Japanese Peace Treaty, to visit Washington for talks preparatory to the North Atlantic Council first with Mr. Acheson and then with Mr. Acheson and M. Schuman together. These talks can only last a few days and the Foreign Secretary will then proceed to Ottawa, where the Chancellor of the Exchequer and the Minister of Defence will join him in representing the United Kingdom at the North Atlantic Council meeting. The agenda for the talks with Mr. Acheson and for the tripartite talks with Mr. Acheson and M. Schuman in Washington and the latest text of the agenda for the Ottawa Conference are attached as annexes to this Paper.
2. Except in the matter of policy towards Germany, on which I am circulating separate memoranda, it is not likely that the Foreign Secretary will be called upon at these meetings to take decisions such as would require new instructions from the Cabinet at the present moment. Generally speaking, the line which he will follow is covered by existing agreed policy and, where this is not so (as, for example, in the matter of new American initiatives in regard to "closing the gap" and in regard to a European defence force), either the position is so fluid that no concrete Cabinet instructions are possible or the discussions are to be exploratory only and not intended to result in decisions. I think, however, that the Cabinet will wish to have this survey of the main issues likely to arise in the forthcoming series of discussions and of the line which the Foreign Secretary will pursue. I am grouping the subjects under broad headings and not necessarily following the order in the various agenda which in any case differ and to some extent overlap.
3. It is, of course, possible that Soviet action at the San Francisco Conference will be such as to upset the time-table for the Washington talks and even for the Atlantic Council; and it cannot be altogether excluded that developments in San Francisco might cause some interference in the broad policies which the Western Powers have in mind to pursue at this series of meetings. This cannot be foreseen, however, and the following paragraphs are based on the assumption that the Washington and Ottawa meetings will proceed as planned and that the Western Powers will continue to follow the general course of policy which they have followed up to the present.
I.—Political Questions
4. The primary object of the talks with Mr. Acheson will be for the two Ministers to assure themselves that United States and British policy are substantially in line on major issues; and where there are divergencies to reconcile these if possible or find a means of minimising their effect. The same applies generally to the tripartite talks also, for, although we do not admit the principle of Anglo- United States-French direction in global strategy (as opposed to purely Atlantic strategy), we must carry the French in most of the major political issues with which we are confronted.
5. The second purpose will be to prepare the ground for the North Atlantic Council and to form some common idea as to the results which are to be expected from it. The three Ministers will also no doubt examine and agree upon the broad programme of discussion and action for the coming months, leading up to a second meeting of the North Atlantic Council in Rome later in the Autumn.
6. The main political headings are the policy of containment of the Soviet Union and its satellites, the future of European integration and the Atlantic community, policy in the Middle East and policy in the Far East. Subsidiary issues are the Italian Peace Treaty, Austria, Spain and the problem of protecting nationals in Eastern Europe.
Survey of Progress in the policy of containment of the Soviet Union and its satellites
07. This item is placed first on the tripartite agenda in order that the three Ministers may begin their meeting with a general survey of the progress made by the West in containing Communism since their last meeting nearly a year ago and with a discussion of future policy and action.
08. Broadly speaking, I think the Foreign Secretary would be right in saying that His Majesty's Government consider events to have justified the policy adopted by the West in this period. The policy of building up positions of strength and of offering firm resistance to any threat of aggression has been successful and the Soviet Union have suffered a series of set-backs. Apart from the successful armed resistance in Korea, we have provided the necessary deterrents to any move forward in Germany, Austria or Southern Europe and we have established without let or hindrance an Allied Supreme Command in Europe with additional American and British forces on the ground. We have instituted very substantial measures of rearmament designed to maintain the deterrent effect of the Atlantic alliance and we have refused to allow ourselves to be divided or turned from our purpose by Soviet propaganda or by the Peace Campaign or by the perils of the four-Power talks. These experiences suggest that we should continue to resist encroachments and to build up our strength, but without provocation and that above all we must remain united.
09. As our confidence and our strength revive, however, two concurrent dangers will have to be watched. The first is the risk that we might overlook or misjudge the reaction of the Soviet Union to some element in our policy which touches a sore spot in their security or around their perimeter. Unless the Western Powers make careful assessments of these risks and agree upon them there will always be a danger that the Soviet Union might be provoked to preventive war or at least to move over to a war economy, while the Western defence preparations are still at an elementary stage. This danger applies particularly to American policy in the Far East, but there are other matters, such as the establishment of air bases near the Soviet borders, which might be equally dangerous. There is, indeed, a risk that, owing to impulsiveness or under the pressure of excitable public opinion, United States policy might go to unreasonable lengths. The Foreign Secretary should utter a word of warning if and when appropriate against such tendencies.
10. The second danger is that we might overlook the need for the Western Powers to be constructive and positive in their relations with the Soviet Union. If, for example, they do not show willingness to negotiate, they are likely to alienate important sections of Western opinion. This is not to say that the moment is ripe for the Western Powers to proclaim their willingness to enter into full-scale negotiations with the Soviet Union with a view to a general settlement.
11. Finally, it may be advisable for the Foreign Secretary to point out, as a prelude to the discussions which he and the Chancellor of the Exchequer will be having at a later stage on the burden of defence, that the need to sustain morale and to maintain a reasonable standard of living amongst the peoples of the West is just as important as the need to increase defences. Too much pressure to increase defensive expenditure of nations which lack resources of economic wealth may be very dangerous, and may result in opening the way to Soviet penetration and thus defeating the very object of containment. European Problems and the United Kingdom Attitude towards European Integration
12. This item is placed on the bilateral agenda in order to give the Foreign Secretary an opportunity to explain to Mr. Acheson British policy towards the European integration movement. This can be summed up as follows. We are willing to play an active part in all forms of European co-operation on an intergovernmental basis but cannot surrender our freedom of decision and action to any supra-national authority. We are quite ready to encourage Continental countries who feel disposed to adopt such plans and in the case of the Schuman Plan have declared our wish to be closely associated with any Authority that may be set up under it. We are considering the possibility of making a more definite statement in this sense in the near future. We are also ready to look very sympathetically on the European Army Plan provided it can be shown to be militarily effective. We are anxious to develop the consultative role of the Council of Europe which is the focal point of the European integration movement, and the proposal that the Chancellor of the Exchequer should introduce to the Consultative Assembly the Annual Report of the O.E.E.C. can be quoted as an example of our desire to encourage the Assembly to discuss serious matters.
13. Broadly speaking, however, it is our aim to foster the idea of an Atlantic rather than a purely European community, although we believe that closer continental integration on a supra-national basis is not necessarily inconsistent with our conception of the larger entity. The Foreign Secretary might emphasise the point that the independent position of the United Kingdom enables us in cooperation with America to play a very special and important role in the free world; that closer dependence on the Continent would impair that position; and that it is thus in the interests both of the United States and of the other Western countries that we should maintain our independent position.
14. Later, at the Ottawa Conference, there will be a discussion of means for developing the Atlantic concept and the non-defence aspects of co-operation within N.A.T.O. and it is understood that Mr. Acheson will make proposals under this heading. The Foreign Secretary will be generally sympathetic towards the idea of developing co-operation between the United States, Canada and Western Europe on the Atlantic basis and will be favourable towards any reasonable proposals for strengthening the machinery of N.A.T.O. for these purposes. It is clearly in conformity with our policy not to allow the North Atlantic Treaty to become simply a defence organisation designed to meet the present threat from the Soviet Union, but to keep alive the longer-term objective of an Atlantic community.
Alignment of United States–United Kingdom Policies in the Middle East
15. Egypt.—We have reached a critical stage in our relations with Egypt. The Egyptian Government is threatening to abrogate at an early date the Anglo-Egyptian Treaty of 1936, on which we base our right to station forces in the canal zone. If they do so, we shall of course stand on our rights under the treaty. According to present estimates, we shall be able to maintain our position in the canal zone, although with difficulty.
16. It would of course be far preferable that we should have reached agreement with the Egyptians. We believe that our best, perhaps our only chance of reaching such an agreement is to make a new offer to the Egyptians, based on Egyptian participation in the new Allied Middle East Command. Such an offer would not, of course, dispose of the Egyptian refusal to contemplate any solution of the defence question unless we first satisfied their demands over the Sudan. There is, however, some hope that if the Americans support us in an offer to the Egyptians of participation in the new Allied Middle East Command, they may agree to discuss the offer, leaving the question of the Sudan for the moment in abeyance.
17. The Americans can help us by associating themselves with our offer, and, if the offer fails by supporting us in the stand we shall have to take. The Foreign Secretary will therefore make it his object to secure:—
(a) American agreement on what we regard as our essential minimum requirements in Egypt for the defence of the Middle East; (b) full support in our attempts to secure them, and an undertaking that the Americans will make it clear to the Egyptians at an early stage that their support will be forthcoming;
(c) an undertaking to co-operate with us in an attempt to bring Egypt into the proposed new Middle East Command, as a possible means of solving the present deadlock to our defence negotiations; and
(d) an undertaking to stand by us if negotiations break down, leading perhaps to serious trouble in the Canal zone or to an argument in the Security Council.
18. General.—The problems of the Middle East vitally affect American interests as well as our own, and we readily admit that we cannot tackle them alone. Such questions as Arab refugees, economic development and, above all, defence, need co-ordinated planning.
The Foreign Secretary will therefore suggest to Mr. Acheson that we should reaffirm the principle that, in all matters where our common interests are involved, we should always consult each other at an early stage in the formation of policy.
19. Kashmir.—At the end of September Dr. Graham, the United Nations Mediator, is due to report to the Security Council. We expect him to report failure to effect the demilitarisation of Kashmir. At about the same time the Constituent Assembly of Indian-occupied Kashmir will be convened. Both events will increase tension, and are likely to lead to heavy Pakistan pressure for action in the United Nations against India. We are anxious to avoid anything in the nature of a Resolution which merely condemns India and leads to stalemate in the Security Council. We therefore hope to get the case referred to the Assembly if, as seems likely, it cannot be settled in the Security Council. As this subject was placed on the agenda at the request of Mr. Acheson, the initiative lies with him. But the Foreign Secretary will take the opportunity to make our views known to him, and will seek his support for the proposal to refer the dispute to the Assembly.
Alignment of United States-United Kingdom Policies in the Far East
20. Korea.—The Foreign Secretary will wish to obtain assurances from Mr. Acheson on the following lines:
(a) That the policy of the United States Government is neither to withdraw prematurely nor to extend the war, and that they will continue to keep the South Korean Government firmly under control to prevent them frustrating United Nations policy.
(b) That the United States and United Kingdom Governments shall consult together on further references to the United Nations regarding Korea. We consider that if an armistice is secured the matter should go at a suitable stage initially to the Security Council and then be referred to the Assembly. In the event of no armistice it will be difficult to avoid a general debate in the Assembly in the form of an inquest.
(c) If full-scale fighting breaks out again in Korea, we would still hope that the United States Government would agree with us that the campaign should be confined to Korea and that a general offensive up to the Manchuria border should not be attempted. We should stand more or less on present lines, inflicting maximum loss on the enemy. Should, however, any Chinese offensive against the Kansas line be repulsed with heavy losses and general disorganisation, General Ridgway should have discretion to undertake tactical advances as is thought militarily desirable to follow up the retreating Chinese. Should he wish to make a major advance—such as to advance as far as the “Northern Waist”—this would require the approval of Governments. If the new enemy offensive included large-scale air raids from points outside Korea, we would support a policy of retaliation. In that case we and the United States would have to reckon with the probability of general war with China, possibly extending to war with Russia.
(d) If all goes well in Korea and the way seems open to a gradual general improvement in the Far East situation, we hope that it will not be blocked by a rigid United States attitude towards the Chinese People’s Government. If an armistice is arranged, we trust that the United States Government will agree in principle to sit round a table with representatives of Peking for the next round of talks which, in the first instances, should be confined to Korea. A meeting of representatives of some of the countries contributing aid to the United Nations in Korea, together with the Russians, Chinese and possibly the North and South Koreans, might be a suitable forum. The ground for this meeting could be prepared by a specially appointed United Nations representative. If, in the view of the majority of the United Nations, a change-over in Chinese representation in the United Nations will contribute to a Far Eastern settlement we hope that the United States Government will accept the majority view. If we succeed in reaching a settlement in Korea we hope to pass on to wider discussions for a general settlement in the Far East. We do not, however, overlook the fact that even if an armistice is arranged we may have to face a prolonged political stalemate on the basis of a divided Korea.
China, including representation in the United Nations
21. General Policy.—Whilst the United Kingdom and United States Governments are both building up strength and will resist Chinese interference in the affairs of others, our joint aim should be stability and peace by avoiding interference in Chinese internal affairs, by keeping open the small windows to the West that are still in existence, and by consultation with like-minded Governments including Asian Governments, and by the gradual relaxation of tension.
22. Formosa.—The Foreign Secretary will seek an assurance from Mr. Acheson that the assistance which the United States Government are giving to Chiang Kai-shek is solely for the purpose of the defence of Formosa and will not be misused for adventures elsewhere, including Burma. A policy of pin-pricking the Chinese is futile and dangerous.
23. Chinese Representation in the United Nations.—Unless there is some major change in the situation (e.g., an extension of the Korean war), we should continue our present flexible policy of voting to postpone the question of Peking's admission into United Nations organs (i.e., the moratorium). If, however, an armistice is secured in Korea, the absence of Peking from the United Nations may be a major stumbling-block in the subsequent political discussions. It is too early to decide whether it will be wiser to press for a change-over in Chinese representation in the United Nations before general political discussions, but the United States Government should be made aware that in our view Peking's representation in the United Nations will be an essential condition for a general settlement though we have at present an open mind on whether this change-over should take effect before or after political discussions. It might, for example, be left until after general agreement on the terms of a settlement in Korea and be conditional on such general agreement.
24. Indo-China.—The Foreign Secretary will enlist the support of M. Schuman for the line he proposes to take with Mr. Acheson in the bilateral talks. M. Schuman is likely to refer to Indo-China. He may suggest an Anglo-United States guarantee of the frontiers of Indo-China; this is impracticable. He may ask for military support in the event of Chinese intervention in Indo-China. The Foreign Secretary would in these circumstances assure M. Schuman that we are wholeheartedly behind the French in Indo-China and would do our best to help them, subject to our own commitments at the time and to similar action being taken by the United States. He would then propose that a meeting of the United Kingdom—United States—French Chiefs of Staff should be held to formulate a tripartite military policy for South-East Asia and make recommendations to the three Governments.
Italian Treaty revision, including Trieste
25. The United States and French Governments agree with our view that the Italians have a strong case on military, political and equitable grounds for revision of their Peace Treaty. There are, however, serious difficulties (e.g., the Yugoslav attitude and the fact that Russia is a party to the Treaty) and we consider that the matter must be approached with caution. The first stage in our view—and the only one which for the moment we consider practicable—should be a tripartite declaration by the United States, United Kingdom and French Governments of their intention to seek a revision of the military and economic clauses of the Treaty. Formal action would require reference to all signatories, and would have to wait until the situation was easier. The French have accepted this position in principle. The American view is not yet known, but they are likely to minimise the difficulties and to favour immediate action for formal revision.
26. The United States Government and His Majesty's Government have agreed to urge the Italian and Yugoslav Governments to negotiate on Trieste as soon as possible, and it might greatly assist the Italian Government in presenting any settlement to their public if we could arrange simultaneous action on the Peace Treaty. Our first objective at Washington will, therefore, be to prevent hasty action on treaty revision before the various difficulties and notably the question of Trieste have been disposed of. This may not be easy. The United States Government have invited Signor De Gasperi to Washington immediately after the Ottawa Conference and will not want to send him away empty-handed, and the French are, on general political grounds, anxious to help Italy over Treaty Revision.
Austria
27. This subject was suggested by Mr. Acheson. It is likely that he will wish to discuss the two questions of Treaty Tactics and Occupation Costs.
28. Treaty Tactics.—The Austrian Foreign Minister has suggested that it would be desirable to hold a meeting of the Deputies on the Austrian Treaty early this autumn, in order to reassure Austrian public opinion. The Russian attitude on this subject has for some time been uncompromisingly negative and shows no sign of changing. Moreover, when the Deputies last met, progress was held up over the question of Trieste. At present we are trying to persuade the Italians and Yugoslavs to reach an early settlement of this question. If we succeed we shall be in a much better position to reopen the Treaty talks.
29. The Foreign Secretary intends therefore to take the line that no meeting of the Deputies should be held in the near future, though, if necessary, a statement reaffirming the attitude of the Allies over Austria might be issued after the meeting with the object of heartening Austrian public opinion.
30. Occupation Costs.—We have been pressed by the United States Government to pay our own occupation costs in Austria. We have so far refused, mainly on the ground that the occupation costs at their present level represent a very modest contribution by Austria to her own defence and that of Western Europe. It is not suggested that we should change our attitude.
Spain
31. When the United States Government decided to enter into military discussions with Spain, Mr. Acheson assured Sir Oliver Franks that the question of Spain's association with N.A.T.O. would not be raised, and that General Franco was only to be invited to discuss such matters as the provision of airfields for staging aircraft through Spain. So far, the United States Government appear to have kept fairly strictly within these limitations, but General Franco has already asked for military aid for the Spanish Armed Forces and there is no doubt that he will press this demand in subsequent phases of the negotiations. He is also certain to drive a hard bargain over economic aid. Strong pressure will no doubt be exerted on the State Department, not only by the Spanish Government, but also by the pro-Spanish lobby in Congress and by the military authorities.
32. In these circumstances the Foreign Secretary proposes to emphasize that His Majesty's Government remain firm in their opinion that any arrangement involving American military aid to Spain would have most unfortunate results. It is to be hoped that this will help to reinforce Mr. Acheson's position.
33. If General Franco insists as his quid pro quo upon the provision of military aid, the Americans may propose to raise the problem of military aid for Spain in N.A.T.O. The Foreign Secretary would strongly oppose this suggestion, which could only lead to an open disagreement between the Americans and ourselves in N.A.T.O. The French would be likely to support our point of view strongly, though there is less certainty in the case of certain other N.A.T.O. members, notably Italy. The Protection of nationals in Eastern Europe
34. Mr. Acheson put this question on the agenda, probably as a result of the recent imprisonment of Mr. Oatis, an American citizen, in Czechoslovakia and of their experience in connexion with the imprisonment and release of another American, Mr. Vogeler, by the Hungarian Government. He is likely to suggest that we should agree on a common policy to prevent further cases of this kind.
35. The Foreign Secretary will suggest that it would be very difficult to work out any rule of thumb for dealing with such cases, and that each case should be considered on its merits. He will assure Mr. Acheson that we are not prepared to accept terms for the release of Mr. Sanders (a British subject at present in prison in Hungary) which might prejudice the security of the Western Powers. On the point of principle, he will emphasise that, while it may be possible in particular cases to bargain with the satellite Governments for the release of individuals, His Majesty's Government consider it dangerous to accept the principle of "ransoming" such persons, because it would merely encourage the satellites to persecute foreigners.
II.—Defence Questions
36. The most important of the Defence Questions to be considered at the tripartite meetings is "the European Defence Force and the problem of an early German contribution with particular reference to procedure and methods." This is dealt with in separate Cabinet papers, and I need only say here that the discussions in Washington on this topic are intended to lead up, not to the Ottawa meeting of the Council (where it is unlikely that the subject will be touched on except in the most general terms), but to the later meeting of the Council in Rome. The other main headings under defence are Atlantic and Mediterranean Commands and the question of Greek and Turkish accession to N.A.T.O., with which is connected the question of the Middle East Command.
Atlantic and Mediterranean Commands
37. The Americans may press for finalization of the Command arrangements for the North Atlantic Ocean. Earlier in the year there was, as the Cabinet know, general agreement within N.A.T.O. to the appointment of Admiral Fechteler as Supreme Allied Commander, North Atlantic Ocean, but after the public criticism of this appointment in Parliament the Americans announced that they were not ready formally to approve the arrangements.
38. We ourselves have been taking the line that the final announcement of this appointment should not be made until the establishment of an equivalent Command under a British Supreme Commander either in the Mediterranean or in the Middle East could be announced. The agreement now reached in the Standing Group is that there shall be a Supreme Command, Middle East, under a British Supreme Commander but that there shall be no Supreme Command in the Mediterranean. Admiral McCormick, who has succeeded Admiral Fechteler as Commander-in-Chief of the United States Atlantic Fleet, is expected to be nominated as Allied Commander Atlantic Ocean and the Foreign Secretary proposes to agree to the announcement of his appointment provided that at the same time the willingness of the three Standing Group powers to take part in a Supreme Command in the Middle East under a British Supreme Commander is announced.
39. In the Mediterranean it is proposed that there shall be two Naval Commanders-in-Chief, the American Admiral commanding United States naval forces and being primarily responsible for supporting General Eisenhower's right flank; and the British Commander-in-Chief, Mediterranean, commanding all British naval forces and naval bases in the Mediterranean, with primary responsibility for supporting the Supreme Allied Commander in the Middle East. There will naturally be very close co-operation between the two Allied commanders, who will work out together the division of their responsibilities throughout the Mediterranean. It is likely that there will be a subordinate French command in the Western Mediterranean. Greece and Turkey and the North Atlantic Treaty Organization
40. One matter on which it is hoped to reach positive decisions at the Ottawa Conference is the admission of Turkey and Greece to the North Atlantic Treaty. As my colleagues are already aware, His Majesty's Government have committed themselves publicly to support the admission of these two countries and assurances to this effect have been given to the Turkish and Greek Governments. In the case of Turkey, we have made it plain that we should expect her, once she is admitted to the Treaty, to play a full part in the defence arrangements for the Middle East. We have received repeated assurances from the Turks that they are prepared to do this once they have been admitted to N.A.T.O.
41. This decision was reached by us reluctantly because we were satisfied that the United States Congress could not be persuaded to offer guarantees to Turkey and Greece in any other form. The French Government, with even more reluctance, now appear to have reached the same decision. But a number of the lesser members of N.A.T.O. are still unconvinced of this and are advocating the conclusion of a Mediterranean or Middle East Pact as an alternative method of securing the co-operation of Turkey and Greece in Western defence. The Report of the Deputies, which will be under discussion at Ottawa, brings out these conflicting opinions.
42. The first part of the task at Ottawa will be to convince these governments that there is no prospect of any alternative of this kind being accepted and that admission to N.A.T.O. is the only solution. The objections likely to be expressed fall under two main heads. First, that the arrangement extends unduly the area of responsibility of member countries (such as the Scandinavians and Benelux) who have no special interest in the Middle East; and second, that the admission of Turkey and Greece into the N.A.T.O. family will destroy the "Atlantic concept" on which the treaty is based. It may be possible to allay to some extent the first of these fears by means of the Command arrangements which are being worked out in the Standing Group, whereby the defence of the Middle East area, including Turkey, would be regarded as primarily the responsibility of a Middle East Command not fully answerable to N.A.T.O. as a whole. As for the second, it may be that the proposals which Mr. Acheson intends to put forward for strengthening the Atlantic concept and fortifying the non-defence aspects of the Treaty will meet these objections to some extent.
43. Assuming, however, that the basic opposition of certain members to the admission of Turkey and Greece can be overcome the second part of the Foreign Secretary's task will be to safeguard our thesis that Turkey must be primarily associated for defence purposes with the Middle East Command under a British Supreme Commander. Despite the agreement in the Standing Group on the main principles of such a Command, and of Turkey's participation in it, we are by no means certain that the Americans genuinely support the arrangement and there is a lot of evidence which suggests that they would prefer to bring Turkey under General Eisenhower's Command. They have persistently expressed the view that no prior conditions must be attached to Turkey's admission and have been reluctant to agree that command questions should be discussed at all at the Ottawa meeting. Our own idea had been that the N.A.T.O. Powers might agree in principle at Ottawa to the admission of Turkey and Greece, and that discussions might then have taken place with these two countries as to how they would fit in to the Command Organisation, on the understanding that Turkey has undertaken to play her full part in the Middle East. The formal invitation might then have followed at the Rome meeting of the Council. Unfortunately we have now been informed officially by the Turks that they will not take part in conversations about the proposed Middle East Command Organisation until they can do so as parties to the North Atlantic Treaty. We shall therefore be obliged to modify our programme. If we leave the discussions with the Turks until after the Rome meeting of the Council it may be too late to utilise the establishment of the Command as a possible solution of our dispute with Egypt, which is one of its main advantages to us. We must therefore find some means of giving the Turks sufficient satisfaction at Ottawa to induce them to enter into discussions with us at once, and this may mean agreeing to an invitation to them to join N.A.T.O. without any assurance, other than those which they have given orally but categorically to us, that they will in fact join in the Middle East Command. This is a risk which we may have to take, placing reliance on the word of our Turkish allies. III.—Economic Questions
East-West Trade
44. The only fixed item of an economic nature on the agenda of the bilateral talks is the question of East-West trade on which the Foreign Secretary will take the opportunity to re-state the importance which we attach to the supplies which we obtain from Eastern Europe. He will take the opportunity of explaining once more our objections to the use of United States assistance to dictate the trade policy of other N.A.T.O. countries, a procedure which is endorsed in draft legislation at present before Congress, and will wish to make it clear that in deciding our own policy we shall not be influenced by the provisions of any United States legislation, although we shall continue to co-operate with the United States Government and other friendly Governments on East-West trade policy.
United States Attitude towards the Economic Aspects of the Defence Programmes
45. In Ottawa there will be an opening clash of opinion with the United States Government about the economic implication of the N.A.T.O. defence programmes. Though the responsibility for presenting the point of view of His Majesty's Government in this part of the discussion in Ottawa will fall primarily on the Chancellor of the Exchequer and Minister of Defence the issues at stake will be fundamentally political and the Foreign Secretary will wish to share the responsibility with his colleagues. Moreover, both he and the Chancellor may find it desirable to explore the political and economic aspects of the subject with the Administration in Washington in advance of the meeting in Ottawa. The United States authorities, including in particular the United States Deputy, have openly declared what the main objective of the United States Government will be at the meetings in Ottawa and Rome. To quote from a statement circulated by the Deputy they think that “it would be appropriate for decisive action to be taken at the October meeting aimed at meeting the total requirements of the Medium Term Defence Plan,” i.e., the plan whose fulfilment the military Standing Group of the N.A.T.O. have declared to be essential if the North Atlantic area is to be made militarily secure by 1954. There is in fact a large gap between the requirements of this plan and the total contributions which the N.A.T.O. Powers have severally undertaken to provide and the purpose of the United States representatives in Ottawa will be to persuade the representatives of other Governments that it is not only necessary but within the capacity of the various countries concerned to close this gap by 1954. The United States Government do not appear to contemplate any increase in their own defence programme for the next three years and the amount of military aid to other countries which they are thinking of asking Congress to note in 1953 is no more than they have recommended for the present year. They are in fact looking to the other N.A.T.O. countries to make the principal contribution towards closing the gap and there is a hint in the Deputy's statement that they may even suggest that the amount of military help which these countries will receive from the United States will depend on the degree to which they are able to satisfy the American view of what may properly be expected of them by way of an increased effort. 95 per cent. of the total defence effort of N.A.T.O. is, however, at present borne by the United States, United Kingdom and France and it is an illusion to suppose that the contribution which the smaller countries could make towards closing the gap could be very large in any circumstances. It is also implied in the Deputy's statement that if the first United States objective is achieved, namely, the implementation of the Medium Term Plan by 1954, the United States Government expect Europe thereafter to be able very quickly to dispense with any form of “end-item” aid and possibly of economic aid from the United States and would themselves then make a considerable reduction in their own defence expenditure.
46. There is every reason to suppose that most of the other N.A.T.O. Governments will be strongly opposed to ideas of this character and that their main endeavour at Ottawa will be to show that their defence efforts are already as large as economic and political circumstances allow. The Foreign Secretary and his colleagues, though they may agree that some of the smaller countries such as Belgium are being rather laggard, will wish wholeheartedly to associate themselves in characterising the American approach as ill-timed and ill-conceived. In the first place they will wish to point out that it takes no account of the work upon which the economic organs of N.A.T.O. have been engaged for the past few months and which is based on the fundamental concept that the burdens of defence must be equitably shared. The report of the Financial and Economic Board of N.A.T.O. will be likely to support our view that the programme to which the United Kingdom is now committed may already be more than its fair share, that the United States programme, including foreign aid, massive though it is, may not be more than their fair share, and that France's programme, on paper at any rate, may at least be equal to its fair share. Secondly, the American approach overlooks the fact that there is anyway a gap between the equipment which will be produced under the present defence programmes of the N.A.T.O. countries and the equipment which would be necessary properly to fit out the forces which they have agreed to supply. Although the United Kingdom is undertaking a defence programme which His Majesty's Government consider to be the maximum possible in present circumstances, we shall none the less not be able out of our own resources to equip the forces which we intend to raise ourselves or have an obligation to equip and we are counting on supplies of equipment from the United States to fill or at least narrow this gap. Full equipment for the forces we intend to raise by 1954 would cost about £4,000 million so far as we have been able to calculate and we are only planning to produce ourselves from £2,000 million pounds' worth so that even allowing for stocks in hand the gap will be very large. For the current year, however, the indications are that we shall get only a very small amount of equipment from the United States. Before agreement is reached to try to fulfil the full Medium-Term Defence Plan the forces which the N.A.T.O. countries have already undertaken to raise ought first to be properly equipped. In short, more United States aid is needed before existing programmes can be effectively executed let alone any expanded programmes. Finally, it would neither be equitable nor practicable for the N.A.T.O. countries other than the United States to maintain their forces out of their own resources after 1954 while the United States Government made a drastic reduction in their own expenditure on defence. Any attempt to arrange matters in this way would moreover result in such an increase in the disparity between American economic strength and that of Europe as would have a most disruptive effect on the alliance as a whole.
IV.—Conclusions
47. The United Kingdom and France could only undertake larger defence programmes than those to which they are publicly committed if they were to go on to a basis of a full war economy. Apart from the economic and internal political consequences of such a policy as this the result might well be to make the Russians follow suit and so precipitate the war which it is the purpose of the N.A.T.O. to prevent. It would in fact only be justified if, for other reasons, it appeared likely that war was imminent. The Foreign Secretary will have to make this plain to the Americans and he will, of course, have the strong support of M. Schuman. The conclusion which he will wish to have drawn is that short of an imminent threat of war there are only two ways of closing the gap between existing programmes and the Medium-Term Defence Plan, namely, a large increase in the American effort or a downward reassessment of the requirements of the Plan itself. If General Eisenhower supports the new American approach by asking for more fully equipped divisions to be stationed in Europe than existing plans contemplate, the best way to meet his requirement would be for more American divisions now stationed in the United States to be put under his command. The Foreign Secretary will also wish to join his colleagues in making the general points mentioned in the preceding paragraph and so far as the United Kingdom in particular is concerned in laying special stress on the two points (a) that short of imminent war our present defence effort is the most that we can contribute, and (b) that in order to make it effective more American equipment will be needed than we appear on present form to be likely to receive.
C. R. A.
10 Downing Street, S.W. 1, 30th August, 1951. SECRET
CABINET
Please attach these Annexes to your copy of C.P. (51) 239.
Cabinet Office, S.W.1.,
31st August, 191. ANNEX I
AGENDA FOR UNITED STATES - UNITED KINGDOM DISCUSSIONS
1. European problems and the United Kingdom attitude towards European integration.
2. Alignment of United States - United Kingdom policies in Middle East: A. Egypt B. Persia C. Kashmir.
3. Alignment of United States - United Kingdom policies in the Far East: A. Korea - next steps (with or without Armistice) B. China, including representation in the United Nations. C. East - West trade. D. Economic questions.
ANNEX II
AGENDA FOR TRIPARTITE DISCUSSIONS
01. Survey of progress in the policy of containment of the Soviet Union and its satellites.
02. Atlantic and Mediterranean Commands.
03. Greece and Turkey and North Atlantic Treaty Organisation.
04. European Defence Force and problem of early German contribution with particular reference to procedure and methods.
05. Contractual arrangements with Germany.
06. Italian Treaty, revision including Trieste.
07. Austria.
08. Spain.
09. Problems of protecting nationals in Eastern Europe.
10. Far Eastern Questions. A. Korea - next steps (with or without armistice). B. Policy toward China, including representation in the United Nations. ANNEX III
DRAFT AGENDA FOR SEVENTH SESSION OF THE NORTH ATLANTIC COUNCIL
I. Opening address by the Chairman.
II. Adoption of agenda.
III. Exchange of views on the world situation.
IV. Discussion of activities of the North Atlantic Treaty Organisation, based on:
1. Report by the North Atlantic Council Deputies to the North Atlantic Council, to include: a) Report of the Chairman, Council Deputies b) Progress report from Council Deputies c) Progress report from Defence Production Board d) Progress report from Financial and Economic Board.
2. Statement by military representative.
V. Association of Greece and Turkey with Western defence.
VI. Report by each member country on the status of defence effort.
VII. North Atlantic defence plans - Proposals for co-ordinated action by NAT agencies, particularly in preparation for October meeting of Council.
VIII. Future development of NATO, other than in connection with defence plans.
IX. Other business.
X. Communique. CABINET
GERMANY
MEMORANDUM BY THE PRIME MINISTER
As my colleagues know, the question of a new relationship with the German Federal Republic is the most important item on the agenda for the Foreign Secretary's meeting with Mr. Acheson and M. Schuman in Washington next month. Much has already been done since 1948 towards a more normal relationship and we have now reached the stage of moving from an occupation régime to a contractual relationship, while preserving supreme authority in certain essential spheres. This is tied up with the question of a German defence contribution. The report of the High Commission (a summary of which is attached at Annex I), on the proposed new contractual arrangements, has been received and one of the main purposes of the Washington talks is to send new instructions to the three High Commissioners which will enable them to resolve existing differences between the three national elements in the High Commission, and to complete their negotiations with the Germans before the Foreign Secretary meets Mr. Acheson and M. Schuman again towards the end of October. All this flows from the decisions taken by the Foreign Ministers of the three Occupying Powers in Brussels last December, which the late Foreign Secretary reported to the Cabinet in paragraph 6 of C.P. (51) 74.
2. The Western Government and public opinion are of course well aware of the proposed change in the international status of Germany and they conceive, unfortunately with some justification, that the proclaimed Allied desire for a German military contribution places Germany for the first time since the war in a strong bargaining position. These and other recent developments have affected the climate of opinion in Germany. The revision of the Occupation Statute, the Prohibited and Limited Industries Agreement, the signature of the Schuman Plan, and the political and military discussions which have taken place with, as well as without, German participation, about Germany's own future, have given the German public the impression that the Allies are moving, though, in their view, too slowly and sometimes incoherently, towards the proclaimed goal of re-establishing Germany as a respectable and equal, or nearly equal, member of the Western family of nations. Germany's relations with the Occupying Powers have recently been under considerable strain over such issues as the export of coal (and in our own case scrap) and, above all, the financial burden of increased occupation costs. Considerable political capital has been made of this by opposition elements in Germany. There is an understandable impatience over any delay in the achievement of equal status, and unless this goal is achieved reasonably soon, there is a real danger that political extremists may undermine the moderate elements now dominating German political life.
3. Meanwhile, my colleagues will have seen Mr. Acheson's message and the replies sent by the Foreign Secretary and M. Schuman. The texts are attached as Annexes II, III and IV. It is clear from this correspondence that the Americans are set on a programme of study and discussion designed to lead up, before the end of this year, to fundamental decisions on the political relationship of the Occupying Powers in Germany. The first decisive stage in the programme is to be the meeting between Mr. Morrison, Mr. Acheson and M. Schuman in Washington in September, when Mr. Acheson urges that we should be prepared to reach tripartite agree- ment on this matter. The views expressed by M. Schuman are generally in line with our own. He also hopes for early decisions and brings out the close association between a German political settlement and a German defence contribution.
Thus the tempo of political evolution in Germany and the programme suggested by Mr. Acheson (although it will be seen that the Foreign Secretary and M. Schuman have warned him that they consider his programme a pretty tight one), make early decisions unavoidable, both in regard to the political status of Germany and to her participation in Western defence, which are of course closely inter-connected. The Allies cannot with safety postpone for much longer a final decision on these issues. If, by the end of the year, it appears that they are unwilling or unable to reach such a decision, a damaging collapse of public confidence in the West will take place in Germany. Either the three Occupying Powers must resolve to carry forward the policy of reconciliation and integration of Germany with the West, on which we have acted since 1948 in accordance with our numerous public commitments in that sense, and to conclude a settlement acceptable not only to the German Government (who will almost certainly need to make constitutional amendments which would require a two-thirds majority in the German Parliament) but also to the general body of German public opinion, or we must be prepared to face the danger of the eventual collapse of our German policy and the gradual passing of Germany out of the Western orbit and probably eventually into the Soviet camp. This view is strongly endorsed by the United Kingdom High Commissioner in Germany. On the second hypothesis, security considerations would demand a tightening rather than a relaxation of the occupation régime, with all that this implies in increased financial and man-power demands upon us, in addition to the dangerous tensions thus revived in Western Europe. Such a reversal of our policy seems to me an alternative which we cannot possibly contemplate.
5. The question of Germany's future political status is bound up with the question of defence. The firm and lasting association of Germany with the West on a basis acceptable to other Western European countries, including ourselves, can only be made certain through defence arrangements. It would be unsafe to allow Germany that degree of political independence which would enable her to rearm except under arrangements effectively controlled by the West and linked with the defence measures of the Allied Powers as a whole.
6. Thus the question of Germany's political status and that of her contribution to Western defence are closely connected, and in accordance with the decisions taken at the Brussels meeting of the North Atlantic Council they are to be settled together. It was on this understanding and to this end that the High Commission report has been prepared. The United States and French Governments are quite definite that a German defence contribution is the price for political equality. It is clear, however, that, in view of the rapid political evolution in Germany to which I have drawn attention above, we cannot escape from the necessity of pressing on towards a political solution with its corollary of a defence solution. The present intermediate position cannot be held much longer. A settlement which, while giving Germany a new degree of political independence, would eliminate the threat of the recreation of German national armed forces under German control is a necessary prerequisite for any lasting solution of the old problem of Franco-German enmity in Europe. This has been, and remains, a major British interest. The atmosphere, both in France and Germany, is now favourable for such a solution. But if this opportunity is now missed, it is unlikely to recur.
7. The High Commission's report concerning a new relationship between the Allied Powers in Germany results from the Brussels Conference of the North Atlantic Powers last December. At this meeting the three Foreign Ministers instructed the High Commissioners to elaborate in broad terms, for consideration by their Governments, a general outline of arrangements to be made with the Federal Republic of Germany, which would reflect changes in the present occupation régime by reason of Germany's participation in Western European defence. The goal was to be the establishment of relations between the Occupying Powers in Germany on as broad a contractual basis as possible, excepting such matters as could be resolved only in a peace settlement. The problems involved in working out such a relationship were to be explored with the Germans.
8. The main questions covered by the Report are summarily outlined in Annex I. What is involved amounts, in effect, to a peace treaty without territorial clauses, or a final settlement of claims against Germany. The central issue is that of the supreme or special authority of the Occupying Powers, deriving from the unconditional surrender of Germany. It is proposed in the Report to identify the fields in which the Occupying Powers will continue to exercise this authority. It is clear that in order to secure German agreement to the settlement we shall need to limit these fields to what is absolutely essential and that we must retain the exercise of our supreme authority only where it is vital to our interests as opposed merely to being desirable. It will also be seen from Mr. Acheson's message (Annex II) that he proposes the following definition:
(a) The right to station troops in Germany and to protect their security; (b) Berlin (which is not part of the German Federal Republic and where, therefore, our position rests on the power derived from the unconditional surrender); (c) The unification of Germany and a subsequent peace settlement; (d) Territorial questions.
I am in general agreement with this proposal, but it requires further clarification. In particular, "the right to station troops in Germany and to protect their security must specifically include the Allied right to resume supreme authority in an emergency. In fields in which contracts are concluded, the agreements will be binding upon both the Allies and the Germans and the exercise of supreme authority in those fields will thereby be renounced by the Allies.
09. Upon the entry into effect of the agreements, the Occupation Statute will be abolished and the Allied High Commission will be replaced by a Council of Ambassadors. Before that stage the three Governments will need to agree upon a charter for this council. Normally our Ambassador would deal direct with the German Government and German Ambassadors would be appointed in London, Washington and Paris.
10. The discussions in the High Commission and with the Germans have proceeded without commitment, though on our side there has, of course, been interdepartmental consultation, both during the discussions and since the High Commission's report has been produced. The report shows that differences between the United Kingdom and United States Elements in the High Commission are few and that it should be possible to resolve them without great difficulty. On the other hand, differences between the French Element and the other two Allied Elements are more numerous and more fundamental. The French have shown themselves anxious to interfere as little as possible with Allied supreme authority and they contemplate the persistence of Allied reserved powers in a number of fields. It seems unlikely at this stage that the French will be moved from these positions except in return for the satisfaction of French requirements connected with the European Army proposals. Annex I to this paper shows the general line which it is proposed that the Foreign Secretary should take in Washington.
11. The question of the European Army and of the German contribution towards Western defence will inevitably form an integral part of the discussions in Washington of a new political relationship for Germany. Mr. Acheson's and M. Schuman's messages show that in their view the two matters are intimately connected and the programme of discussion and study, of which the tripartite talks in Washington will form the first part, are designed to lead up to the North Atlantic Council meeting in Rome in the late autumn at which final decisions would be reached on both aspects of the German problem.
12. The United States Government have moved even more definitely than we supposed in the direction of supporting the European Army concept and although they appear to be taking a more optimistic view than either we or the French think justified about the progress made in the Paris Conference they are clearly determined to do their utmost to bring the European Army idea to fruition, as the only means by which they think the French will agree to a German contribution. We are accordingly attempting to arrange for discussions to take place on a military basis between the Americans, the French and ourselves in Washington before the meetings of Ministers, during which the somewhat vague and incomplete contents of the Paris interim report can be worked up into a more concrete plan, taking account of the practical points set out in the Bonn Report on the recent exploratory discussions with the Germans. General Eisenhower has expressed his readiness to be represented at these talks and has even offered himself to serve for an interim period as "Commissioner" of the European Army when formed. It is hoped that as a result of these discussions the three Ministers may have before them in Washington a set of proposals for the creation of a European Army, on which they might reach agreement in principle. These agreed proposals would then be injected into the Paris Conference so that some practical and effective plan would be ready for consideration by the North Atlantic Council at its Rome meeting in October or November.
13. As in the case of the contractual arrangements, this programme is a very tight one, but there is no doubt whatever that unless the Foreign Secretary is to come out openly as opposed to further progress on the European Army (involving, as it does, a German contribution) he will be compelled to discuss the matter in some detail with Mr. Acheson and M. Schuman in the middle of September. When the Cabinet considered this matter on 31st July (C.M. (51) 56th Conclusions. Minute 6) they were concerned primarily with the forthcoming Ottawa meeting of the North Atlantic Council, and with the Report on the Bonn discussions on the size, nature and organisation of German contingents. The emphasis now is on the European Army and the tripartite talks in Washington, and it is for this reason that it is necessary once again to consult the Cabinet on the general line to be followed.
14. In this connexion my colleagues should be aware of the far-reaching economic and financial problems which will arise from any German defence effort, on which a separate paper is being submitted to the Cabinet to-day. The Foreign Secretary will take full account of the considerations set out in that paper in any discussions which he may have on the German contribution to European Army.
Conclusions
I therefore hope that, before the proposed discussions with Mr. Acheson and M. Schuman begin, my colleagues will accept the following principles for the Foreign Secretary's guidance:
(a) United Kingdom and European interests alike require a settlement which will retain the German Federal Republic in the Western camp and will ensure that the Western German defence potential is available to the West and does not pass to the Soviet bloc. This is also a major factor in present United States policy, as Mr. Acheson has made clear.
(b) This policy carries two implications:
(i) for this purpose and having regard to the political evolution already achieved in Germany, there is now no possible alternative to agreeing to a further advance by the German Federal Republic towards political independence on a contractual basis acceptable not only to the German Government, but also to the main body of German public opinion;
(ii) the question of Germany's part in Western defence must be faced. We do not want an independent Germany whose security is the sole responsibility of the Allies without any economic or manpower contribution from the Germans themselves. As was explained in C.P. (51) 233, the defence of Western Europe cannot be assured except by the defence of Western Germany and this requires German participation. Moreover, it is only by associating her in defence with the rest of Europe that Germany can be firmly tied to the Western camp.
(c) The European Army concept, as advocated by the French and now strongly supported by the Americans, is primarily a method of ensuring that any German defence contribution shall be inextricably bound up with Western European defence as a whole and prevented from leading to the creation of German national armed forces.
(d) Provided therefore that the European Army plan can be made militarily effective and acceptable to the Supreme Allied Commander in Europe, the Foreign Secretary should give every encouragement to it and if possible reach agreement with Mr. Acheson and M. Schuman on the broad principles which should govern it. These would then be further examined amongst the participants in Paris, with a view to the submission of a concrete plan to the North Atlantic Council later in the autumn.
(e) All possible steps should be taken to ensure that the economic burden borne by His Majesty's Government for Western Defence is not increased on account of a German defence contribution.
C. R. A.
10 Downing Street, S.W. 1, 30th August, 1951. ANNEX I
REPORT OF THE ALLIED HIGH COMMISSION CONCERNING A NEW CONTRACTUAL RELATIONSHIP TO BE ESTABLISHED BETWEEN THE ALLIED POWERS AND GERMANY
General Principles Underlying the Allied High Commission's Recommendations
Supreme Authority
1. It is agreed that the Allies must retain the supreme or special authority derived from the unconditional surrender of Germany in 1945, but that they will identify the fields in which they will exercise it. There is agreement that Allied responsibilities relating to the ultimate Peace Treaty and the reunification of Germany, the right to maintain forces in Germany and, in emergencies, to take steps to protect their security, and the occupation of Berlin are not proper subjects for contractual arrangements. Mr. Acheson's formulation of these basic requirements is set forth in Annex II. The French wish to see Allied supreme authority maintained in a number of other fields, namely, in respect of reparations, occupation costs, security controls, offences against Allied security and expulsions. They are also reluctant to see the limitation of the supreme authority expressed in any contractual document. They would prefer a notification to the German Federal Government.
2. In the fields in which contracts are concluded, the agreements will be binding upon both Allies and Germans, and the exercise of supreme authority in those fields will thereby be renounced by the Allies.
Disputes
3. In the event of disputes arising out of the contracts, it is proposed that resort should first be had to discussion between the parties. If redress could not be secured, either party could refer to an Arbitral Tribunal. The Tribunal, which would be composed of an equal number of Allied and German members and a chairman of another nationality, would have power to take any action necessary to correct a violation, and to authorise the complainant to take specific direct action to redress the wrong in the event of the defaulting party's failure to comply.
Principles Underlying the German Attitude
4. The German Delegation has declared that if the eventual arrangements contain provisions which would not be appropriate in a Treaty between equal and sovereign States, they will be unacceptable to the Bundestag and to German public opinion. They have, however, admitted the existence of certain special problems and in these cases their position does not appear completely inflexible; they have, for example, envisaged proposals which would give Allied Forces somewhat greater rights than have normally been accorded to forces stationed by agreement in the territory of a friendly nation. They have also expressed themselves willing to consider the possibility of a contract regarding security controls, provided the conditions of the contract were such as to be politically and constitutionally feasible. Similarly, while they have demanded complete freedom from external intervention in the German governmental process and the relinquishment of present Allied legislative powers, they are willing to contemplate Allied emergency powers which would include certain legislative functions. The Germans also recognise the special character of the Allied position in Berlin. It must be borne in mind, however, that, whatever position the German Delegation adopts when the arrangements come before the Bundestag, the influence of German political parties is certain to be exercised in the direction of greater, rather than lesser, demands.
Areas of Disagreement and Line to be Adopted in dealing with them
5. The differences between the United Kingdom and United States positions are few and it should be possible to resolve them without great difficulty. Differences between the French position and the positions of the other two Allies are both more numerous and of a more fundamental character. The immediate object of the Washington meeting must be to surmount these inter-Allied differences so that the Allied representatives may present a common front to the Germans in a second round of exchanges of view which will have to be held before the Rome meeting. While, therefore, the following paragraphs deal principally with inter-Allied differences and the line which it is proposed to adopt in dealing with them, reference is made in certain instances to the difficulties with which the German attitude on particular problems is likely at a later stage to confront us.
Security Controls
6. The United Kingdom and United States High Commissioners have recommended that the contractual arrangements should provide for such minimum controls as security may require in the fields of disarmament and de-militarisation, scientific research, industry and civil aviation. The French High Commissioner believes that such controls should continue to be based on Allied reserved powers, exercised in the same manner and through the same channels as at present. The French position seems inconsistent with our political objectives.
7. It is therefore proposed to support the American proposal that the minimum safeguards required should be:
(a) those proposed last December by the N.A.T.O. Military Committee; viz. that Germany shall agree not to produce or manufacture (except as may be authorised by N.A.T.O. or other approved Western defence organisation) heavy weapons, military aircraft, naval vessels other than minor defensive craft, atomic, biological and chemical weapons or long-range missiles; or any specific productive, testing or training equipment or components associated with the development, production or use of such material;
(b) that, in addition, restrictions shall be maintained over atomic energy materials and facilities, and prohibitions be maintained over the production of civil aircraft and some electronic tubes. This proposal would entail further modification of existing industrial controls (see C. P. (51) 89).
Preservation of Democracy
8. The French High Commissioner recommends that the Germans should be required to undertake to maintain a basically democratic and federal form of government, in which civil liberties are protected and the decentralised structure of the police preserved. The United States and United Kingdom High Commissioners, while favouring some such declaration of intention in the preamble of the contract or agreement, would not be in favour of providing for an Allied intervention in the German constitutional system except in an emergency in which security was affected. French motives in this matter are suspect; the French would certainly wish to use a general undertaking of the kind envisaged by the French High Commissioner as a means of perpetuating the present constitutional weakness of the Federal Government, which is already an embarrassment to us. While it is recognised that a fundamentally undemocratic development in Germany would imperil Allied security, it seems politically wise not to attempt to extract particular undertakings from the Germans in this field. We should rather rely on the provisions of the German Basic Law and the Constitutional Court which we hope shortly to see established, and upon the concept of Allied security as our proper recourse if anything goes fundamentally wrong.
Logistical and Financial Support of the Allied Forces
9. The United States and United Kingdom High Commissioners consider that these questions should be regulated by a contractual arrangement, while the French High Commissioner considers that occupation costs should continue to be levied by Allied authority. The French position here is unrealistic. In the absence of inter-Allied agreement of this subject and of a decision regarding a German defence contribution, it has not been possible to have detailed discussion with the Germans in this field. We have however a clear idea of our own requirements regarding logistical support when the time comes for such a discussion. A separate Cabinet Paper (C.P. (51) ) has been prepared on the economic and financial implications of a German military contribution to Western defence.
Security of the Allied Forces
10. There is inter-Allied disagreement regarding the extent to which the Allies should in future rely upon the Germans to deal with offences by Germans against Allied security and to carry out the expulsion of undesirables from the Federal territory. The French High Commissioner believes that certain exceptionally serious offences should in normal circumstances only be triable before Allied Courts; the United States High Commissioner believes that, although such offences should normally be tried by German Courts, the Allies should retain the right to withdraw cases from the German Courts for trial by Allied tribunals. The United Kingdom High Commissioner considers that a stage will have been reached at which the Allies should retain no jurisdiction to try Germans. This seems to be the only position which we can expect the Germans to accept. As a corollary, we shall have to rely upon the German authorities to arrest, detain, interrogate and expel German and other non-Allied security suspects, as soon as efficient German services can be provided for that purpose.
Legal Status of Allied Personnel
11. There is inter-Allied disagreement regarding the status of Allied nationals serving with the Council of Ambassadors, and their dependants. The United States and French High Commissioners would wish to ensure for such persons the privileges and immunities provided for Allied military personnel, whereas the United Kingdom High Commissioner believes that these persons should enjoy only such immunities and privileges as are normally accorded by diplomatic usage. The United Kingdom High Commissioner also considers that the Allies should not attempt to retain any Allied tribunals in Germany except courts martial; it would be difficult to expect the Germans to accept any other arrangement. The Air Ministry agree and although the War Office would prefer to see the present Control Commission Courts retained, they recognise that this may be politically impossible.
Reparations
12. The French High Commissioner alone considers that Allied reserved powers should be retained in this field. Apart from this question of principle, the Allies are agreed on the scope of the undertakings which we should wish the Germans to assume in this field. The treatment of German external assets is, however, a field in which we must expect major German resistance.
Foreign Interests
13. The Allied High Commission has not yet been able to inform the Germans of Allied requirements regarding foreign interests and establishment rights in Germany. It is hoped, however, that Governments will shortly be able to approve a detailed report on this subject so that discussions with the Germans can take place.
Form of Arrangements
14. The High Commissioners recommend that the subjects which Governments agree to place on a contractual basis should be grouped into a small number of agreements. They recommend that there should be a General Convention containing provisions of general applicability. This Convention should be given a form which summarises the salient points of the new relationship and can be readily understood by the general public; it will be seen from Annexes II and III that we are in agreement with the United States Government on this point. It is of interest that the United States High Commissioner has already produced a draft of such an agreement: the general lines of this seem satisfactory. It is not clear whether the document carries State Department approval, but we shall certainly hear more of this. To this General Convention should be attached, either as annexes or as related conventions forming a single whole with the General Convention, a series of arrangements covering the arbitral tribunal, security controls, status and protection of members of the Allied Forces, logistical and financial assistance to the Allied Forces, the foreign relations of the Federal Republic, its relations with other parts of Germany, certain Allied programmes in Germany and the protection of certain interests (e.g., decartelisation, restitution, reparations, foreign interests in Germany and Displaced Persons and refugees). Dear Mr. Morrison: I have been thinking a good deal about the range of problems we face jointly in integrating a German contribution into the defense of Europe and in establishing a new contractual relationship with the German Federal Republic. We clearly ought to reach a common understanding as to how satisfactory solutions to these problems can be reached as quickly as possible. Accordingly, I am writing to you personally with a view to agreement upon a working program which will enable us to reach decisions on the various questions involved. In view of this purpose, I shall not attempt here to discuss detailed solutions to these problems since I believe this can be handled more satisfactorily through appropriate channels after we have agreed upon the general approach.
The urgency of these matters arises from their inseparable connexion with building the defense of Western Europe. We all agree that our common plans for Western European defense will not be complete without a German contribution. We also agree, and recognised at Brussels, that a German contribution depends upon simultaneous progress in adjusting relations between the Western occupying Powers and the German Federal Republic. Nor is the immediate problem of defense the only reason for urgency. Both of the above matters bear directly upon the development of further consolidation of continental Europe, which depends to a great extent upon decisions soon to be made—the ratification of the Schuman Plan and the success of the efforts now being made in Paris by European nations to establish a common defense community.
Our approach to these problems has not been a static one. We have thought—and still think—that rapid progress toward continental European association within a developing Atlantic Community is essential to our common peace and prosperity, and to that of the whole free world. We have also thought—and still think—that urgent progress in realising our common hopes for a concrete German contribution to Western defence is also essential. During the past year we have given full support to the development of a European defense force under the Atlantic umbrella as a long-range concept to which all of our efforts should be devoted. At the same time we have thought that the urgency of securing a German contribution to defence required an interim solution which would allow German preparations to get under way in such a way as to be compatible with the longer range goal of establishing a truly European defence force.
We now see a real hope that these two objectives can be combined. The recent and striking progress made in the Paris Conference on the establishment of a European defense community makes it possible that a German contribution can be obtained quickly through the establishment of a European defense force. General Eisenhower believes this can be done. We are prepared to act on the basis of this hope and possibility. We will give the fullest support to a programme which would combine the short-range necessity of obtaining the German contribution quickly and the fulfilment of the long-range concept of the establishment of a common defense force in Europe. We will do this vigorously if the continental European nations themselves approve this course, if they will promptly work out the military aspects satisfactorily to the N.A.T.O. Military Committee and to S.A.C.E.U.R., and if they will complete the process in time to allow Germany's contribution to become effective within the time schedule we have all agreed must be urgently met for the defence of Europe. For this reason we believe it essential that the full elaboration and final implementation of all the necessary administrative structures and political arrangements in connexion with the European defense force would not be a condition precedent to the actual beginning of German defense preparations. We would hope that agreement in the Paris Conference, acceptable to N.A.T.O. as a whole, could be reached this fall among the European nations participating at Paris which would allow initial preparations in Germany to proceed pending the final and formal act of establishment of the European force. We believe such steps can be taken without prejudice to the security considerations, relative to German rearmament, which we all have in mind.
With these considerations in mind I turn to a plan for moving to rapid agreement on the new political relationship to be established between the Western occupying Powers and the German Federal Republic. We agree, I think, that the progress made in this field must be equal to that made in the defense field. For a variety of reasons the three Governments have been slow in this field and my present concern is that the completion of an agreement recording a basic change in our relations with the Federal Republic might in itself be a delaying factor in its entry into defense. The cumulative effect of recent world events and the present temper of German opinion make it not only necessary, but in our own interest, to put forward, simultaneously with the military solution, a political formula of a far-reaching nature. I also believe that we cannot ignore the effect in Germany of the forthcoming peace treaty with Japan.
I suggest that in general the Germans should be given full power to conduct their own affairs and that the powers we retain should be determined solely by the fact that Germany is a divided nation confronted with a menace to its security beyond its own control. Our mission there should be changed from one of "occupation" of the territory of a defeated enemy to one of assistance to a partner who is freely contributing to our mutual defense. This will involve, as we have already agreed, abolishing the OCC Statute and the High Commission. Supreme authority would be retained in four fields only: (a) the right to station troops in Germany and to protect their security; (b) Berlin; (c) unification of Germany and a subsequent peace settlement; and (d) territorial questions. I believe we should also begin to give thought now to the admission of Germany to N.A.T.O. as a full member after she has obtained this new political status and final decisions have been taken on Germany's defense contribution. By proceeding along these lines I believe there is a good chance of building a solid foundation for future German co-operation with Western Europe and the whole Atlantic Community.
The High Commissioners are now working on a report to Governments on results of their political conversations with the Germans. We should receive this report within a few days. The High Commission has done a great deal of essential work in exploring the numerous complex problems to be dealt with. But I am told that they will be unable to reach agreement on a substantial number of fundamental questions regarding Germany's new status. Governmental agreement on these matters will clearly be necessary prior to final negotiations with the Federal Republic. So it seems to me that we should make this one of the primary subjects to be dealt with by the three Foreign Ministers when we meet here in September. I would urge that we be prepared to reach tripartite agreement on these matters at that time. In view of the work schedule we all face this fall, the High Commission, after submitting their report, should continue to work together and with the Germans on certain matters which do not have to be reserved for our personal consideration in the conference in Washington.
In the light of what I have said, I suggest the following working program: —
(1) We should each give urgent attention to the forthcoming High Commission report on their discussions with the Germans on contractual relations. We should exchange views as soon as possible after study of their report, and do such other preparatory work as will enable us to reach tripartite agreement on all matters presented in their report when we meet in September.
(2) Agreement reached in our tripartite discussions in Washington on Germany's new status should be sufficiently complete so that the High Commissioners could subsequently conduct and conclude final negotiations with representatives of the German Federal Republic. We should do our best to give them a text of a basic agreement with the Federal Republic along broad lines susceptible of public understanding. We would also, of course, discuss progress on defense arrangements with special emphasis on the accomplishments at that time of the Paris conference.
(3) The three Foreign Ministers should meet in Europe in late October before the meeting of the North Atlantic Council to reach final agreement on contractual relations. Sufficient progress should have been attained in Germany so that the German Foreign Minister could join our meeting. We should aim for final Four-Power agreement then. By that date, also, I hope that a completed treaty on the establishment of the European defense community would have been signed by Governments and be ready for submission to Parliaments. This would allow the simultaneous submission in the German Bundestag of the final arrangements on both the political and military aspects of Germany's association with the West. I am sure we all agree that this is essential. Both from our point of view and from the German point of view questions of political equality and military contribution must be finally considered and decided together.
(4) At the meeting of the North Atlantic Council in late October, we should endeavour to obtain final agreement on those aspects of the above arrangements which are within the competence of that body. At this meeting we would make the appropriate formal disposition of the N.A.T.O. action regarding a German contribution assigned to the three Powers at Brussels and of the separate mission undertaken by European nations to plan for the formation of a European defense force. In other words, we should aim for final agreement, acceptable to N.A.T.O. as a whole, on the problem of the German defense contribution at that time.
If some schedule along these lines seems possible to you, I suggest that we should, for the present, postpone any formal action on the report recently received from the High Commission of their discussions with German representatives at Bonn on a German military contribution.
Such a schedule of work and accomplishment would put us well on the road to a stabilisation of the German problem and a major strengthening of our own defenses. In confining this letter to the subjects which I have discussed, I do not intend to limit the scope of our talks in September about which our representatives will continue to consult.
I would greatly appreciate receiving your views.
I am sending a similar letter to M. Schuman.
ANNEX III
TEXT OF THE FOREIGN SECRETARY’S REPLY OF 16TH AUGUST TO MR. ACHESON’S LETTER OF 9TH AUGUST
My dear Acheson,
I was very glad to have your personal message communicated by the United States Embassy about the problems which we face jointly in integrating a German contribution into the defence of Western Europe and in establishing a new contractual relationship with the German Federal Republic. I have been giving much thought to these questions and I am happy to see that we are thinking on similar lines.
As regards the contractual arrangements I have only just received the Report which the High Commission has prepared and have not yet had time to study it. My first impression is, however, that the United States and British Elements are in agreement on most essential points. Our first objective must be to reach tripartite agreement and I hope this will be possible when we meet in Washington in September. You will already be aware that I have suggested to this end that our meeting in Washington should be preceded by tripartite official talks. Like you I hope that agreement in our tripartite discussions will enable the High Commissioners to conduct and conclude final negotiations with representatives of the German Federal Republic. I would attach importance to the production of a basic agreement with the Federal Republic along broad lines which will be readily understood by the general public.
The central problem in the contractual negotiations is that of the retention of supreme authority by the three allies. I agree that the fields in which supreme authority would be retained should be defined. While, however, I am in broad agreement with the four points mentioned in your message, the precise definition of these fields clearly requires further consideration prior to our meeting next month.
I agree with you on the urgency of pressing on towards a decision on these questions. The working programme which you suggest is a very tight one. We will do our best to adhere to it, but it is clear that the contractual relationship is not a question that can be considered by itself. As you say, both from our point of view and from the German point of view questions of political equality and military contribution should be finally considered and decided together.
As regards a German defence contribution, I agree that the establishment of a European defence force may well offer an acceptable solution. Before we give our full support to this project, however, I think we must first be sure that it is a practicable proposition and can be satisfactorily organised for the efficient defence of Europe. I note your view that the recent striking progress made in the Paris Conference makes it possible that a German contribution can be obtained quickly in this way. We have no information on this beyond the interim report of the Conference, which is, as you know, vague and incomplete on many points of military detail. We are now looking at it and I am sure it would be valuable to discuss it with M. Schuman in Washington. In the meantime, since the time factor is important, I think it would be useful if our national representatives on the Standing Group could study it from a practical military point of view. At the same time, I think they should make use of the report from the High Commission on their discussions with the German representatives at Bonn, since it contains much useful practical material on the possibilities of a German defence contribution.
We shall, of course, have to consider the big issue of Germany's admission to the North Atlantic Treaty Organisation at a later stage in the light of the progress achieved in regard to her new political status and her defence contribution.
I am bound to say that the final phases of your proposed time-table strike me as a bit ambitious, given the complexity of the subject. But you may be sure that my colleagues and I, for our part, will do our best.
ANNEX IV
TEXT OF THE FRENCH FOREIGN MINISTER'S REPLY TO MR. ACHESON'S LETTER OF 9TH AUGUST
Dear Mr. Acheson,
Thank you for having been kind enough to inform me, in your letter of 9th August, of your personal views on the fundamental problems which are to be discussed in our conversations in Washington in September.
My reply, which is also made in a personal capacity, has been delayed by the need to consult the new Government on the multiple and serious problems which will be examined in the course of the coming Conferences and which cover the responsibilities of several ministerial departments.
Let me first tell you how happy I am to note the interest you take in the efforts which France is at present making to create a European Community, and the support which your Government is giving to our plans.
This policy is being manifested by the ratification and rapid execution of the Plan for a Coal and Steel Pool, now laid before the six Parliaments concerned, and the elaboration of the Treaty concerned with the organisation of a European Defence Community which we intend to complete as shortly as possible. We will thus be brought to the preparation of a real political community between the free States of Western Europe, including Federal Germany.
These initiatives have been inspired by the governing idea, to which my Government rests firmly attached, of integrating Western Germany, on a basis of equality, in a European community, itself included, in your own words, "in an Atlantic community continually developing." It would thus be possible to renounce a system of control whose guarantee is force and which would not be—as the experience of the period following the First World War proved—a satisfactory and lasting solution. At the same time the risk must be avoided, so serious to peace and for the Germans themselves, of rebuilding a nationalist Germany which might be tempted to play off East against West.
It is then from this point of view that we should, I think, tackle with Mr. Morrison the examination of the German problem.
I need not underline the fact that France wishes ardently that Great Britain should be able to participate in these arrangements, or be associated with them in a manner corresponding with her interests. If, for her own reasons, and of these she must be the only judge, Great Britain were unable to take an integral part in the European Community, we would regret it, being assured however that, in conformity with the general aim of our common policy, Great Britain would make every effort to facilitate our action and would co-operate closely with the United States and the European Community in the Atlantic framework, which would thus be reinforced.
The policy of European union implies for all those who participate in it, and for France in particular, important sacrifices, a fundamental modification of tradi- tional systems which have been established for centuries, and sacrifices of sovereignty to supranational authorities. But we feel that we make this contribution not only in our own interest but in that of the whole of the Atlantic Community. If this French initiative makes the integration of Germany into Western Europe possible, it will be to the advantage of all democratic and peaceful countries.
The only too recent past has unfortunately taught us that Germany was subject to rapid and unpredictable evolution. We must, in our own interest and in that of the Germans themselves, forearm the Atlantic Community against such possible evolution. If we wish the integration of Germany in a strongly organised Europe to be, and to remain, an efficacious guarantee, we must in our forthcoming meetings foresee the necessary precautions. Moreover, the Europe in which we wish to include Germany will not be set up overnight. Its constitution will necessitate delays of which we must take account.
I am happy to note our agreement on the fundamental principles on which the new situation of Germany should be based. I think that, after a preliminary meeting of experts at governmental level, we could reach a rapid conclusion on all the essential points, taking as a basis the Report of the High Commission and the recommendations of the London Working Party. I believe, as you do yourself, that we will not have enough time to study the details of these documents, and the most important thing for us to do is to reach agreement on general directives which will enable our representatives to continue and finish their work. But it should be clear that the new contractual statute should not be put into force before the Treaty for the organisation of the European Defence Community is signed and ratified by the Parliaments concerned, amongst them the German Parliament. Similarly, I would like to remind you that we had concluded that the International Authority of the Ruhr could not be abolished before the entry into force of the Coal and Steel Plan.
As regards the contribution of Germany to common defence, I entirely understand your wish to proceed rapidly to concrete action. You therefore quite legitimately wish not to await the final conclusion of all the administrative and political arrangements regarding the European Army before taking a certain number of preparatory measures for the organisation of defence in Germany. I would agree with you if this is not to be the beginning of the execution of plans and if the measures undertaken do not include the recruiting of soldiers in Germany. It is indispensable to my mind that the first man recruited in Germany should be able to wear the European uniform, just as, from the time the Community is set up, the forces provided by all the participants should become European. Should there exist at any time the embryo of a German army, the whole basic idea of the European Defence Community risks a definite check. We should therefore examine with great care the nature of preparatory measures which would be at once both necessary and compatible with the success of our plan. Moreover, I can assure you that, with the help of S.H.A.P.E., we will do all in our power to ensure that the drawing up and putting into effect of the Treaty should be achieved with the minimum of delay. Our objective is to establish a text by the end of October. I would also like to remind you that as soon as the Treaty is ratified, the machinery foreseen therein will be set up. Recruiting could then begin in Germany, even if the European organisation only began to function progressively.
I believe that it is most inopportune to bring up the question of the entry of the German Federal Republic into N.A.T.O. in the present circumstances. Our whole European policy, and in particular the integration of German forces, would be compromised by the possibility of the direct access of Germany into the Atlantic Community. I feel it my duty to point this out to you forthwith. We could later examine the way in which the European Community could be harmonised with other international organisations once it had been established economically, militarily and politically.
These are, dear Mr. Acheson, the principal problems which are so important for the future of our countries and which I have taken up in this letter. We shall certainly have occasion to discuss them at length in Washington and then in Ottawa and in Rome. I wonder, however, if it will be possible to adhere to the time-table fixed, given the importance of these questions added to others. We can discuss this again in the course of our coming meeting.
Believe me, &c.
(Sgd.) ROBERT SCHUMAN. CABINET
PERSIA: STERLING CONTROL ORDER
Memorandum by the Chancellor of the Exchequer
The problem
By virtue of the arrangements contained in a "Memorandum of Understanding" Persia receives from us very favourable treatment in the financial sphere under three headings:
(i) Transferable Account facilities, which allow her the privilege of automatically making or receiving payments in respect of third countries in sterling;
(ii) a gold revaluation guarantee (which cost us £11.4 millions at the time of revaluation);
(iii) Facilities for conversion of sterling into dollars in payment for certain invisibles and for essential goods not obtainable on equivalent terms for sterling.
These arrangements have been renewed by negotiation every year since 1947: and their sole justification has been the profound importance of Persian oil to our economy. Persia continues to be able to make use of these privileges despite the fact that we have now not had the benefit of her oil since June and, moreover, have been forced to spend some £120 millions on replacement. Persia is in fact taking dollars of the order of $650,000 a week; and the Persian sterling holdings to which the privileges of the Memorandum of Understanding apply amounted to £17 millions at the end of July. Until very recently £10 millions of this were immobilised by Persian law in the note cover; but legislation to free this sum has just passed its final stages, so that the Persians now have access to it to meet current expenses.
Although the current "Memorandum" terminates on 19th November, it contains a clause to the effect that any balances existing on its expiry shall continue to carry the privileges in (i), (ii) and (iii) above. The proposed Order and what it would do
2. Preparations have been made for the promulgation of an Order placing all Persian transactions in sterling under control. It is not designed to "freeze" Persian sterling completely. It will nullify the "Memorandum of Understanding" arrangements by removing Persia from the transferable account area: so that instead of Persia having an automatic right of transfer of sterling, her sterling payments and receipts will become subject to the permission of the Treasury (exercised in practice through the Bank of England). It is the intention that the Bank should allow all normal transfers of sterling except:
(a) Transfers to American Account (which is the mechanism by which Persia can obtain dollars for her sterling); (b) transfers relating to oil, i.e. oil itself, oil equipment, tanker hire, insurance, etc; and (c) transfers relating to certain scarce commodities, e.g. sugar, iron, steel, non-ferrous metals and alloys.
The measure is accordingly not intended as retaliation or sanctions against Persia, but merely as a protection to our own economy by giving us the means of withdrawing specially favourable facilities no longer justified.
Complementary measures in the trade sphere
3. As a corollary to the dollar conversion facilities granted to Persia, every attempt has been made to diminish calls on us for U.S. dollars by making available to her scarce goods which she would otherwise have bought in the U.S.A. Consequently, with the withdrawal of the dollar facilities, it will no longer be necessary to deprive ourselves or the Commonwealth of these scarce goods, and action has been prepared to ensure that they no longer go to Persia. The Board of Trade are ready to make an Export Control Order under which all existing licences for exports to Persia of specified scarce goods would be revoked. The making of this Order is being held up until the Sterling Control Order is made. Once the Export Control Order had been made no new licences would be issued for these scarce goods except in special circumstances.
The delay
4. The order has not actually been made so far because it was thought that it might prejudice the success of negotiations. Nor was action taken immediately on the return of the Lord Privy Seal's mission:
(a) in case it should provoke interference with the Anglo-Iranian Oil Company (A.I.O.C.) employees withdrawing from the oilfields; (b) in order to allow a few days for the implications of the suspension of the talks to be fully realised in Persia; and (c) in case it should be regarded in Persia as an economic sanction and thus make it more difficult for moderate opinion there to assert itself.
Future action
5. It is becoming increasingly difficult to justify further delay. The consideration at 3(c) above is no longer relevant: and as far as (b) and (c) are concerned I believe that, provided we are careful to make it clear what we do and do not intend to do, we may even succeed in hastening the fall of Dr. Mossadegh. At the same time we should be in a position to give heart to any successor by the withdrawal of the Order in return for reasonable assurances about a settlement of the oil dispute. Also, once the present obvious opportunity to take action has been lost it will be less convincing for us to say that the measures are merely protective, and they will inevitably savour more of sanctions.
While the arguments for delay are losing their force, the case for action grows stronger. Public opinion in this country will not tolerate indefinitely either the continued dollar drain on Persian account or the fact that by leaving Persia in the Transferable Account Area we ourselves are according to her the means of receiving payment for the oil denied to us. Our dollar situation is deteriorating rapidly. Moreover if we do not act now, action later may appear to have been extorted by the Opposition, or the Press.
The attitude of the U.S.
6. It is, of course, extremely important that we should do nothing to upset the close co-operation which has recently been achieved with the Americans. Our position was explained to Mr. Harriman while he was in London and he will no doubt report to the U.S. Government on his return to Washington. In addition, I propose that while action on our part should not be subject to their consent, we should ourselves approach them at once and then, having made our motives and intentions known to them, take action immediately afterwards.
Abnormal dollar conversions
7. It is possible that the Persians may attempt to withdraw the whole £14 millions, or a substantial proportion of it, and either to convert this into U.S. dollars through the mechanism of the "Memorandum of Understanding", or to transfer it elsewhere, out of reach of our control. I have arranged that any such attempt should be made known to us at once, and, as the Cabinet has previously agreed, should be frustrated by the immediate issue of the Order.
Recommendations
8. I recommend -
(i) That if the Persians attempt to make any abnormal movements of sterling, the Order should be made forthwith. (ii) that the U.S. Government should be informed of our intention to make the Order and, unless their reaction against it is very strong, that it should be issued immediately thereafter.
H.G.
Treasury Chambers, S.W.1.
3RD SEPTEMBER, 1951. CABINET
THE BALANCE OF PAYMENTS POSITION
Memorandum by the Chancellor of the Exchequer
At the beginning of July (E.P.C. (51), 14th Meeting), we considered the report on the 1951-52 balance of payments (E.P. (51), 53). This estimated a dollar deficit for 1951-52 of $2500 millions, and a United Kingdom overall balance of payments deficit, including stockpiling, of £375 millions.
2. At a later meeting (E.P.C. (51), 17th Meeting), the committee considered a further report on import cuts (E.P. (51), 9), which pointed out that the position had worsened. I warned my colleagues that we were expecting a dollar deficit in the third quarter alone of almost £330 millions, and that this meant that by the end of the year gold and dollar reserves might be reduced to about $23,053 millions, and that by the spring one-third of the gains made since devaluation would have been lost.
3. The course of events since then has confirmed these fears. The course of the dollar surplus and deficit this year has been:
| Month | Sterling area dollar surplus or deficit (£ millions) | |-------------|-----------------------------------------------------| | January - March (average) | + 120 | | April | + 59 | | May | + 1 | | June | - 6 | | July | - 137 | | August | - 211 |
4. There have been many non-recurrent expenditures in the last two months, and I should expect the rate of deficit to fall in the next few months. But all the evidence suggests that there will be a continuing deficit, at a rate which will rapidly make serious inroads into our reserves, swallow up the gains which we have made since devaluation, and leave us in a critical position.
5. The new factors in the situation since June are:
6. Persian oil. I have already had to authorise the spending of £150 millions to replace Persian oil, and this will last only to the end of the year. If there is no settlement, the cost of replacing the oil would be about £55 millions in 1952, against this we would save perhaps £75 millions by withdrawing the special arrangements we have with Persia which enable her to convert sterling into dollars for certain purposes.
(ii) European Payments Union (E.P.U.). In July and August, we have been in large deficit in E.P.U., and the estimate for the quarter is £130 millions. This is always a bad quarter, because of expenditure by tourists and on fruit and vegetables. But our deficit has been much larger than anything that could be accounted for by seasonal influences; there has been a rapid increase in our own and the other sterling area countries' imports from Europe, and this is the dominant factor. The result is that we have had to repay all the dollars we earned from E.P.U. last year; we will have repaid the credits we have given them, and from the end of this month onwards we shall be drawing credit from E.P.U., and if our deficits persist, paying dollars at a later stage. In 1951-52, we shall probably lose £150 millions.
(iii) Other sterling Commonwealth. The continued fall in wool prices, and the falls this year in rubber and tin prices, are reducing the sterling area's dollar earnings, while the dollar (and other) expenditure of the other sterling area countries is rising very fast, for the same reasons as ours is. The worsening compared with our June estimate may be £250 millions a year.
In June, the dollar deficit for 1951-52 was put at around £500 million. These three new factors above would raise it to something approaching £1,200 millions. In view of what has happened in the past, there is no need for me to stress the importance of this change in relation to reserves which at the end of June were no more than £3,870 millions.
We had hoped that the United Kingdom deficit with the dollar area (over £1,000 millions, excluding Persian oil replacement) would be considerably offset by the other sterling area countries' dollar earnings, and that we should not lose dollars heavily elsewhere. But these new factors frustrate this hope: indeed, the rise in the cost of our imports from all sources is threatening loss of supplies or payments of gold or dollars all round the world. With Finland, for example, a vital source of timber, pulp and paper, we have a 1951-52 prospective deficit of £50 millions. What we are involved in is a deterioration of the position of the whole sterling area vis-à-vis virtually the whole of the rest of the world.
In the background, I would refer to the problem of Germany. If it became necessary for us to pay the local costs of our Forces, instead of the Germans paying them as occupation costs, this would be an additional burden of up to £180 million a year on our E.P.U. deficit and on our overall balance of payments. This is an additional load which we cannot possibly bear.
During the last fifteen months, the world economic situation has been changing with bewildering rapidity, and inevitably our fortunes rise and fall accordingly. That is why my predecessors and I have continually stressed the importance of having large reserves. Thus the sterling area faces a dollar deficit in 1951-52 of £1,200 millions compared with a surplus in 1950-51 of £1,000 millions; and the United Kingdom position on overall account deteriorates from a surplus of £250 millions in 1950 to a deficit of £400 millions in 1951-52. These facts illustrate how we can never afford to take our eye off the balance of payments and regard our situation as stable. 10. We have had two objectives in our external financial policy—first, to remain independent of general economic assistance from the United States; second, to maintain overall balance, excluding stockpiling, in our external accounts. The second objective is already frustrated for this year. If we allow the reserves to run out without taking the necessary measures, external and internal, to right the situation, we shall be unable to maintain the first objective either.
11. After my return from North America I will make further positive proposals to my colleagues. In the meantime I ask that everyone should take into account the seriousness of the situation in any policy decision which may be made in the next few weeks.
12. I propose to inform Mr. Snyder and other members of the United States Administration of the worsening of our situation. This will be the background to a series of talks on specific economic issues where action by them could assist us and to the more general discussions at Ottawa on sharing the burden of rearmament.
13. I also propose to inform the other Commonwealth Finance Ministers of the situation in the course of my visit to Washington, and to ask them to consider measures to deal with the situation so that we can take effective combined action at the meeting of Commonwealth Finance Ministers which I hope will be arranged at the beginning of January.
A.G.
Treasury Chambers, C.W.I.,
3RD SEPTEMBER, 1951. CABINET
SUPPLIES OF FINISHED MILITARY EQUIPMENT FROM THE UNITED STATES
Memorandum by the Minister of Defence
As a result of an initiative by the Economic Steering Committee, and with the approval of the Chancellor of the Exchequer and myself, the United States Government was informed in March last of our intention, as soon as the £4,700 millions defence plan was worked out in further detail, to transmit to the United States a statement showing how far production under that programme would go towards completing the equipment of the forces which the United Kingdom intended to raise and maintain, and indicating the extent and nature of the deficiencies of equipment which would remain when the programme had been completed. The American Government were informed that these deficiencies were expected to be very considerable - a tentative figure of between £1,400 millions and £1,800 millions was mentioned - and that His Majesty's Government would hope to discuss with them the extent to which these deficiencies could be met by the supply of finished military equipment under the Mutual Defence Assistance Act.
02. The production programme within the £4,700 millions rearmament plan was approved by the Defence Committee at its meeting on 31st July, 1951 (D. O. (51) 21st Meeting, Item 1). It was made clear from the beginning that this programme would by no means meet all the requirements of the Services, and it has now been possible to assess the extent of the deficiencies in equipment which will remain when it has been completed. On the basis of this assessment, a further memorandum for presentation to the United States Government has been prepared. In its preparation, certain issues of policy have emerged on which I think that it is desirable to have the views of the Cabinet.
03. Broadly speaking, the deficiencies of the Royal Navy and the Royal Air Force are of types of equipment which cannot be produced in the United Kingdom within the three-year period and which are required to fill gaps in the equipment of formations which will otherwise be fully ready to fight.
04. The Army's problem is not so simple. In general terms, the production programme for the Army under the £4,700 millions defence plan will provide new equipment for approximately 15 divisions. Existing stocks of equipment will serve to outfit a further 7 divisions, with the very important exception of 'B' vehicles. There will, however, be other serious gaps in the equipment of the 22 divisions whose needs will be met primarily from British production; these consist of types of equipment which are not produced in this country and can only be obtained during the next three years from the United States.
05. By mid-1954 there will be 24 United Kingdom equivalent divisions either already active or available for mobilisation in the early stages of a war if equipment is ready for them. These consist of the Regular Army of 10 $\\frac{2}{3}$ divisions, the Royal Marine Commandos, which are equivalent to one division, and the first and second lines of the Territorial Army, which by that date under the operation of the National Service system will amount to 12 $\\frac{1}{3}$ divisions. We can from our own resources, and subject to the filling of the gaps mentioned above by the United States, provide equipment for only 22. Even if we assume that all the equipment which we produce is allocated to United Kingdom divisions, there will thus still be 2 divisions lacking equipment at that date.
06. Such an assumption would, however, be unsound, as there are certain forces of the Colonies, of Commonwealth countries, and of foreign countries in Treaty relations with us, which we expect to come to the support of the United Kingdom in a global war, which are essential for that purpose, and for which the United Kingdom will be expected to provide the great bulk of equipment. These forces include the Commonwealth divisions which are expected to operate in the Middle East, the Arab Legion, and the Iraq Army. Together they will amount to about 7 divisions; the Colonial forces amounting to some $1\\frac{1}{3}$ divisions.
07. From the United Kingdom land forces, we have accepted as our interim contribution to the Medium Term Defence Plan of the North Atlantic Treaty Organisation (N.A.T.O.) a commitment to provide 9 divisions in the European theatre by the end of the first three months of war. The remainder of the forces in being at the beginning of a war or capable of immediate mobilisation will be required elsewhere, principally in the Middle East and the Far East. The forces which will be mobilised subsequently will be allocated to theatres in accordance with the higher strategic direction of the war.
08. The total equipment requirement of these formations amounts to $32\\frac{2}{3}$ divisions, towards which, as I have mentioned in paragraph 6, the United Kingdom will be able to provide only 22 divisions worth, which will therefore contain serious gaps. There are thus approximately 11 divisions for which no equipment will be available under present plans by mid-1954 and which, unless equipment can be found for them from other sources, will not be ready to fight until equipment can be supplied for them from United Kingdom production after the outbreak of war.
09. The total cost at United Kingdom prices of providing equipment for these 11 divisions, and to fill the gaps in the equipment of the land formations for which the United Kingdom will be primarily responsible, and of the United Kingdom naval and air forces, is estimated to be approximately £1,500 millions.
10. The memorandum which officials have prepared for presentation to the United States Government explains this situation, and proposes that ways and means of meeting the deficiencies disclosed should be discussed between the two Governments. It suggests that the Americans should indicate to what extent they would expect to be able to assist by providing finished military equipment under their Mutual Defence Assistance Programme (end item aid). It also points out that the United Kingdom must look at defence globally, and that the present criterion for grant of end item aid, which limits it to forces earmarked as contributions to N.A.T.O. or for the defence of the United Kingdom base, is artificial and should no longer apply. If the Americans are unable to interpret their legislation so as to widen the criteria in this way, they are asked to accept the thesis that the primary commitment of the United Kingdom must be the equipment of those forces which are ineligible for end item aid and that the resultant deficiencies would thus fall wholly or largely upon the forces committed to N.A.T.O.
11. The proposed approach to the Americans has been based on the assumption that all we intend to ask for is end item aid to meet the deficiencies which will remain when our own £4,700 millions plan has been completed. Hitherto, there has been no suggestion that we should ask for aid in relief of our own defence production programme under the £4,700 millions rearmament plan. I understand, however, that the Chancellor of the Exchequer is of the opinion that, in view of the recent serious deterioration in our general economic position and particularly in the balance of payments, we should now consider whether we should not make some reference to the possibility, to put it no higher, that we may find ourselves compelled to reduce our own programme and to seek a greater amount of end item aid in consequence.
12. I am myself extremely doubtful whether it would be wise even to hint to the Americans at this stage that we may be contemplating a retreat from our declared intention to carry out our full rearmament plan as our appropriate contribution to the defence of N.A.T.O. and the whole free world. I fear that any suggestion of this kind would destroy the value of the approach and make it virtually certain that we should receive an unfavourable reply.
13. I would myself go further and express doubts of the wisdom of approaching the Americans at all with what amounts to a request for aid on an enormous scale. I do not believe that it is likely to produce any very significant result, as there seems little chance that the Americans will be prepared to ask Congress during the next three years for very largely increased appropriations for end item aid, and, since their principal concern is with the defence of Western Europe, it is very probable that they will prefer to supply aid to the European countries such as France which can provide man-power in great strength but have hitherto made little effort to equip it from their own resources.
14. I have therefore been wondering whether it would not be a wiser and more fruitful line of approach to ask the Americans to ensure that the United Kingdom receives the raw materials and the machine tools which it requires in order to carry out its announced defence programme and at the same time to maintain its exports and to increase its productivity sufficiently to maintain its standard of life during the rearmament period and to increase it gradually after the peak of that period had been passed. We might then at some later stage represent to the Americans the deficiencies with which we shall still be left after our programme has been completed, the impossibility of maintaining the production of armaments after the end of the three year period at a level sufficient to meet these deficiencies in a reasonable time, and the need for substantial end item equipment as a means of enabling this country to devote some of its resources at an early date to measures of social betterment and economic expansion.
15. In brief, the points on which I think the Cabinet should express an opinion are:
(a) Should we now approach the United States with a statement of the deficiencies in the equipment of our forces which will still remain when our own three year defence production programme has been completed? ineligible for end item aid and that the resultant deficiencies would thus fall wholly or largely upon the forces committed to N.A.T.O.
11. The proposed approach to the Americans has been based on the assumption that all we intend to ask for is end item aid to meet the deficiencies which will remain when our own £4,700 millions plan has been completed. Hitherto, there has been no suggestion that we should ask for aid in relief of our own defence production programme under the £4,700 millions rearmament plan. I understand, however, that the Chancellor of the Exchequer is of the opinion that, in view of the recent serious deterioration in our general economic position and particularly in the balance of payments, we should now consider whether we should not make some reference to the possibility, to put it no higher, that we may find ourselves compelled to reduce our own programme and to seek a greater amount of end item aid in consequence.
12. I am myself extremely doubtful whether it would be wise even to hint to the Americans at this stage that we may be contemplating a retreat from our declared intention to carry out our full rearmament plan as our appropriate contribution to the defence of N.A.T.O. and the whole free world. I fear that any suggestion of this kind would destroy the value of the approach and make it virtually certain that we should receive an unfavourable reply.
13. I would myself go further and express doubts of the wisdom of approaching the Americans at all with what amounts to a request for aid on an enormous scale. I do not believe that it is likely to produce any very significant result, as there seems little chance that the Americans will be prepared to ask Congress during the next three years for very largely increased appropriations for end item aid, and, since their principal concern is with the defence of Western Europe, it is very probable that they will prefer to supply aid to the European countries such as France which can provide man-power in great strength but have hitherto made little effort to equip it from their own resources.
14. I have therefore been wondering whether it would not be a wiser and more fruitful line of approach to ask the Americans to ensure that the United Kingdom receives the raw materials and the machine tools which it requires in order to carry out its announced defence programme and at the same time to maintain its exports and to increase its productivity sufficiently to maintain its standard of life during the rearmament period and to increase it gradually after the peak of that period had been passed. We might then at some later stage represent to the Americans the deficiencies with which we shall still be left after our programme has been completed, the impossibility of maintaining the production of armaments after the end of the three year period at a level sufficient to meet these deficiencies in a reasonable time, and the need for substantial end item equipment as a means of enabling this country to devote some of its resources at an early date to measures of social betterment and economic expansion.
15. In brief, the points on which I think the Cabinet should express an opinion are:
(a) Should we now approach the United States with a statement of the deficiencies in the equipment of our forces which will still remain when our own three year defence production programme has been completed? (b) Should we couple the statement with a request for assistance in meeting these deficiencies by greater amounts of end item aid than we have hitherto received?
(c) If so, should the underlying assumption be that we intend to complete our own defence production programme during the three years or should we suggest that we may for economic reasons be forced to reduce it and so become still more dependent upon American end item aid?
or (d) Should we at this stage confine our approach to the Americans to a request for adequate supplies of raw materials and machine tools in sufficient quantity to enable us to carry out our own defence production programme on time in order to ensure an increase in general productivity, deferring any request for greater quantities of end item aid until some later date except in respect of some items which are regarded as vital to the completion of our defence programme?
I prefer (d).
E.C.
Ministry of Defence, C.W.1.,
3RD SEPTEMBER, 1951. SECRET C.P. (51) 244 7th September, 1951
CABINET
LEGAL CONSEQUENCES OF EGYPTIAN ABROGATION OF THE 1936 TREATY
MEMORANDUM BY THE SECRETARY OF STATE FOR FOREIGN AFFAIRS
I circulate for my colleagues' information the following brief exposition of the legal position which will arise if Egypt unilaterally abrogates the Anglo-Egyptian treaty of 1936.
2. The 1936 Treaty contains no provisions for denunciation at any time. The Treaty, including the arrangements set forth in Article 8 for the stationing of British forces in the Canal Zone, was to last for 20 years, following which a revision might be negotiated at the instance of either party (that is, neither party could refuse to enter into negotiations), cf. Articles 8 and 16. If the parties failed to reach agreement on revision, then their differences were to be referred to the League of Nations for arbitration. The Treaty might, however, be revised by mutual consent at any time after 10 years from signature. Though it is not obligatory for either party to enter into negotiations for revision, we freely agreed to do so in 1946, as we are willing to do now; at the same time if such negotiations fail, we are not bound to go to arbitration.
3. For the Egyptians to denounce the Treaty unilaterally is therefore illegal. While it might be defensible for them to do so after the 20-year term in the absence of successful negotiations and the failure of arbitration, such denunciation before the 20-year limit is clearly indefensible.
4. If, therefore, the Egyptians denounce the Treaty now, it is reasonable for His Majesty's Government to ignore their action and continue to act at least until 1956 as though the Treaty was still in force. This is, of course, what we propose to do and must do, since the Treaty provides the only legal basis for our presence in Egypt at all.
5. I must, however, mention that His Majesty's Government are maintaining in the Canal Zone three or four times the number of troops which the Treaty of 1936 permits. Further, our strictly legal defence for this action would be somewhat specious and not very convincing. Though the Egyptian representative has recently taken this point in the Security Council, it has not been the ground on which Egypt has put her case up to now. Further, it would be difficult for Egypt to put her case on this ground because, as and when Egypt made this the foundation of her case, it would be legally open to His Majesty's Government to reduce the number of its troops in the Canal Zone to the Treaty limits and to contend that, as soon as this Egyptian demand was officially made, His Majesty's Government had, with all reasonable expedition, complied with it. For Egypt to take this line as the main ground of her abrogation of the Treaty would in addition be politically awkward for her, seeing that all Egyptian Governments throughout the period 1947 onwards have put their case on other grounds, and this ground would not appeal to political opinion in Egypt.
H. M.
Foreign Office, S.W. 1, 6th September, 1951.
41187 CABINET
LONG TERM FINANCIAL PROSPECTS OF THE BRITISH TRANSPORT COMMISSION
MEMORANDUM BY MINISTER OF TRANSPORT
At a Meeting of the Cabinet on 19th March, 1951, I was invited (C.M. 51, 21st Conclusions) to submit to my colleagues a Memorandum on the long term financial prospects of the British Transport Commission.
2. Annex A gives the net Book value as at 31st December, 1950, of the fixed assets of the various parts of the Commission’s undertaking and the gross and net operating receipts (before deducting interest and other central charges) derived from each branch of its activities for the year 1950. This clearly shows the predominating importance of British Railways which account for over 80 per cent. of the Commission’s fixed assets and over 60 per cent. of its gross receipts. London Transport accounts for a further 10 per cent. of the assets and gross revenue. The main features of London Transport, which has an established record of good management, are not likely to be modified substantially in the foreseeable future. It is clear, therefore, that unless some radical alteration takes place in the whole pattern of the Commission’s system its prosperity will depend mainly upon the financial results of the operation of the railways.
In relation to the net value of the fixed assets employed the highest net returns were earned by the Commission’s ships. Fair results were also obtained from the Road Passenger undertakings purchased by the Commission and still operated under a Company structure. Road Haulage during 1950 failed to meet its operating expenses by more than £1 million. This is disappointing, but the Road Haulage Executive was much engaged during 1950 in the difficult task of consolidating the very large number of undertakings (nearly 3,000 in total) acquired under the Transport Act, and substantially better results should be obtained in future. But clearly a small percentage variation up or down in railway receipts or expenses would outweigh in importance any corresponding variation which can be regarded as at all probable in the rest of the Commission’s undertaking.
It is to be noted that the gross receipts of the railways (after meeting a loss on collection and delivery services) exceeded their operating expenses by £234 million. They were thus not operated at an actual loss although their net revenue was insufficient to meet their due contribution to Central Charges which include interest on British Transport Stock.
3. The two aspects of the Commission’s undertaking which bulk largest in the public eye are the growing deficiency in its net revenue and the past and prospective increases in its charges.
The following figures show the Commission’s revenue deficiency for the three completed calendar years of its existence:
| Year ended 31st December | 1948 | 1949 | 1950 | |--------------------------|--------|--------|--------| | Net operating surplus (including “other income”) | £45,205,585 | £31,294,613 | £40,024,492 | | Less central charges | £49,938,409 | £52,055,846 | £54,107,804 | | Deficiency for year | £4,732,824 | £20,761,233 | £14,083,312 | | Deficit on Net Revenue Account as at 31st December | £4,732,824 | £25,494,057 | £39,577,369 |
41208 Having regard to the scale of the Commission's operations these figures are not yet unmanageably large; the disquieting feature about them is that so long as the costs of labour and materials continue to increase they will continue to grow and may well become formidable because the machinery provided in the Transport Act for effecting adjustments of charges is so slow in operation that a substantial deficit can be incurred between the time when an increase is justified by unavoidable rises in costs and the time when it can be authorised. The Commission point out in their Annual Report for 1950 that if the increases eventually made in their charges had been authorised earlier, the deficit of £14 million for the year might have been avoided altogether. Similarly, the figures for 1951 are already prejudiced by heavy losses during the early months due to a sudden and large increase in costs (including increased rates of pay costing about £20 million in a full year) which the Commission were unable to meet by an immediate increase in their charges. The position would have been a good deal worse had not the permanent members of the Transport Tribunal, whom (as required by the Transport Act) I consulted with regard to the most recent increase in charges which took effect in April, taken the responsibility of tendering me their advice without hearing objectors. Demands for increased pay and pensions by the Commission's staff are maturing at the present time and if and so far as they are acceded to a further accretion to the deficiency is to be expected pending an appropriate increase in their charges.
The lag between increases in expenses and increases in charges is of importance only during a period of generally rising costs which outweigh any economies which the Commission can reasonably be expected to achieve. It is primarily due, pending the coming into force of charges schemes, to the obligation imposed on me by the Act to consult the Transport Tribunal before I authorise an increase of charges by Regulations. In the case of the increases authorised last year delay also arose owing to Ministerial discussion of my proposals. On that occasion a period of over six months (4th October, 1949, to 27th April, 1950) elapsed between the Commission's application to me and the announcement of my decision. Of this period, the application was before the Tribunal from 28th November to 16th February, thirteen days being taken up by the public hearing of the Commission's case and of objections by interested bodies.
A protracted period of steeply rising costs was not contemplated when the Act was passed. It has resulted in two applications to me already for regulations authorising an increase of charges, and a third is only too likely in the near future to meet further increases in wages now under negotiation. In my view, the existing statutory procedure needs modification in two respects. Firstly, it should be made more speedy, and secondly the Minister of Transport (and through him the Government) should not be directly responsible for authorising increases. The Minister is in any case for practical purposes bound by the advice given by the members of the Tribunal. There is, I think, a strong case for amending legislation to authorise the Commission itself to raise its charges to meet substantial and unavoidable increases in its costs subject only to subsequent ratification by the Tribunal. The procedure would have to be worked out in detail, but what I have in mind is that subject to the presentation by the Commission to the Tribunal of its full case for an increase, it should be able to make the increase effective at once without prejudice to subsequent modification by the Tribunal. Such a procedure would provide a reasonable safeguard for the public, because the Commission would be anxious not to make increases which on examination proved to be unjustified, and would avoid the delay which, so long as present conditions last, must inevitably lead to a cumulative deficiency of net revenue. It would also avoid the political difficulties inherent in direct approval of increases by a Minister.
4. The Commission understandably feel somewhat aggrieved that increases in the cost of other commodities and services are accepted by the public with comparatively little complaint while increases in transport charges rendered inevitable by precisely similar causes arouse violent objection and lead to allegations of inefficiency. If, for instance, they had been able to raise their charges by the same percentage over pre-war as had taken place in the price of coal without going through any statutory procedure their financial difficulties would be at an end. One reason for the general reaction to increases of transport charges is no doubt the publicity involved in proceedings before the Transport Tribunal, where objectors are certain to suggest that the Commission ought to be able to effect large economies and to draw attention to the bad effects of the increases on the particular interest with which they are concerned. The increases in charges which have taken place on the main line railways since the beginning of the late war are given in Annex B.
5. As a commercial undertaking the Commission, if it is to maintain its financial position, must adjust its charges from time to time should this become necessary to meet unavoidable increases in its costs. There is no reason to suppose that such increases will be out of line with those which take place in other industries in similar circumstances or that with them the Commission would not be able to meet its financial obligations except to the extent of deficiencies due to the time lag between increases of costs and authorisation of charges necessary to meet them. These deficiencies can become cumulatively serious but they are not so yet and apart from them the financial position of the Commission does not at present give ground for alarm.
By the end of 1950 the Commission had used about £100 million of their liquid resources for capital purposes which they had power to finance by borrowing. Provided that they are allowed to exercise their borrowing powers by the issue of stock on the market to meet this and future capital expenditure, their cash resources should be sufficient for several years to provide for additional expenditure on arrears of maintenance and to meet further deficits of the same order as those that have already occurred.
6. The Commission, like any other commercial undertaking, can improve its financial position only by increasing its revenue or reducing its expenditure. It would not be unreasonable to hope for an increase of up to say £4 million per annum in the net receipts of the Road Haulage Executive. Until a Scheme covering the charges made by this Executive comes into force it has practically a free hand in adjusting its charges to its costs. It was not to be expected that this Executive would attain full efficiency while it was welding the nearly 3,000 separate undertakings of which it is composed into an operational whole.
No great increase in the total volume of railway freight traffic can be looked for. The total quantity of goods to be moved cannot be affected by any action on the Commission's part and the railways can only increase their share of it by attracting traffic away from other means of transport. This is no easy task and, so far as the traffic came from the Road Haulage Executive, little if any advantage to the Commission would accrue from it. The Railway Executive carried a larger tonnage of freight (by 0.4 per cent) in 1950 than in 1949. The Executive may reasonably be expected to hold their own, but although they will no doubt continue to do all they can to secure traffic it would be unrealistic to look for any substantial increase.
The tendency of passenger traffic, both in the Railway and the London Transport Executives, has been to fall. Gross receipts from passengers by the Railway Executive declined by over £7 million in 1950 as compared with 1949. The corresponding decline for London Transport (road and rail) was over £4 million notwithstanding certain increases in fares which came into force on 1st October, 1950.
The gross passenger receipts from provincial and Scottish road passenger services owned by the Commission increased from £35.5 million in 1949 to £38.4 million in 1950, or by 8.1 per cent., and the passenger journeys by 10.8 per cent. in England and Wales and 7.8 per cent. in Scotland, but at the same time the net traffic receipts showed a decline from £4.3 million to £3.4 million.
It is impossible to predict the future trends of passenger traffic and receipts because at any particular level of fares they depend to an appreciable extent on such uncertain factors as the habits of the travelling public, the amount of its free spending power, the number of private motor cars in use and even on occasion the weather. It would not be prudent to look for any significant increase in the Commission's net receipts from passenger traffic in the foreseeable future at any practicable level of charges. Passenger transport schemes under Part IV of the Transport Act if and when they materialise might add to the Commission's income in the future but not to such an extent as to alter materially the present picture.
7. The Commission regard it as necessary for the improvement of their financial position that there should be new bases of charge for their services which will take much greater account of the actual types and cost of service on the one hand and will also recognise that over a wide field the Commission's services are not a monopoly and that the ordinary principles of competitive business must be allowed a greater place in the fixing of charges in detail. There is undoubtedly force in this latter contention because in those fields where the Commission do not enjoy a monopoly it is possible for their competitors, who do not have to take the rough with the smooth, to undercut it in the case of the more attractive traffics. At the same time the Transport Tribunal are likely to look very closely at any charging powers of the Commission which would enable them with their large resources to put competitors out of business by charging unduly low rates over a period. A modernisation of their charges structure will doubtless be beneficial to the Commission’s revenue, and the Transport Tribunal, in considering schemes of charges by the Commission, will have to have regard to the Commission’s actual and necessary costs and the fulfilment of the obligations laid upon it by the Transport Act.
8. The Commission could have undoubtedly made its services for both passengers and goods more efficient and attractive if circumstances had been such as to allow it a free hand in capital investment. The Commission, not unnaturally perhaps, takes the view that it has received and is receiving less than its proper share of the national resources. In the short term increased capital investment would no doubt have some beneficial effect on its revenue. It would make it easier for the Commission to retain, on the railways, traffic which may otherwise be diverted to road transport and would doubtless lead to economies in operating costs and increases in efficiency. The effect of major increased capital investment in the long term is difficult to assess.
Electrification of lines with heavy traffic in the neighbourhood of large towns can yield very good results, as the recent electrification of the line from Liverpool Street to Shenfield has shown. The total cost of this scheme was about £8 million, and in the 11 months of 1950 for which figures are available loaded coaching train miles increased by some 33 per cent., passenger journeys by nearly 50 per cent., and passenger receipts by over 40 per cent. Electrification on a wider scale would have less certain results in improving net revenue, and would in any case be limited for some time to come owing to the demand which it would make on scarce national resources and the overall shortage of generating capacity.
09. As regards economies, so long as the physical shape of the Commission’s transport system remains more or less as it is at present economies on a major scale are not to be expected. There is no doubt that the Commission and the Railway Executive are fully alive to the need to effect all practicable economies and they are entitled to claim a fair measure of success in spite of the difficulties which, in common with other sectors of industry, they have had to face. A general indication of this is afforded by the fact that with a general level of charges of 8½ per cent. and 5½ per cent. over pre-war for goods and passenger traffic respectively the Commission was towards the end of 1950 in approximate financial equilibrium. A particular indication is that between 1st January, 1948, when the Commission took over the railways and the end of 1950 the total working expenses per train mile, adjusted throughout to end-1950 prices, had fallen by 25%, equivalent to a saving of £35 to £40 million a year on the output of train miles at the end of 1950. The consolidation of the undertaking of the Road Haulage Executive, together with economies from improvements in organisation and equipment of the Commission’s undertaking generally should show results year by year, although possibly on a diminishing scale. There is, however, widespread opposition by the public whenever proposals are made to close branch lines or to make even quite small changes in the services offered. The Commission is, moreover, faced with reluctance on the part of the staffs of the Executives to depart from traditional organisational structures or methods of working. In its last Annual Report the Commission refers to the necessity for a greater willingness to accept changes, whether in conditions of work or in types of service or in proposals to integrate the Commission’s services and to avoid costly delaying action on each proposal for reorganisation. The recent successful unofficial strike by large numbers of drivers in the Road Haulage Executive against the extension of the employment of Inspectors on the road, the objection of drivers of heavy vehicles generally to an increase in the maximum speed of these vehicles from 20 to 30 miles an hour and threatened trouble as soon as economic transfers of traffic from rail to road or vice versa are proposed are cases in point.
10. A good deal has been said, both during the passage of the Transport Act through Parliament and since, on the possibility of effecting major economies through integration, and the Act in fact lays upon the Commission the duty of providing a properly integrated system of transport. "Integration" is in itself a term which would cover a wide variety of modifications in organisation, from working arrangements between the Executive for the handling of traffic, to a radical modification of the whole transport system.
The Commission, after consulting the Trades Unions, have produced a Statement of Policy on the integration of freight services by road and rail which specified the traffics for which each is specially suitable and efficient and lays down lines of co-operation between the two Executives concerned.
This, so far as it goes, is on the right lines, but to my mind a bolder and more positive approach to this problem is needed. It may be that the possibilities of integration in the wider sense are limited, but it would be rather extraordinary if the railways, which assumed their present shape in the nineteenth century, plus the largely unrelated growth of road transport, have achieved the right balance between the two which is essential to a fully integrated system.
The primary question which to my mind needs an answer is what part should be played by the railways in a fully integrated system having regard to all the means of transport and techniques of handling goods and passengers now available or likely to be so in the foreseeable future. The comparatively expensive and rigid equipment of the railways makes them the solid foundation on which to build. Whatever the right answer, road transport can easily be adjusted to it. Its main assets are shortlived and can be expanded or contracted over a comparatively brief period of years without excessive financial loss. Until this fundamental issue is cleared it is hardly possible for the country to have a coherent transport policy. If the railway system ought, in the general interests of transport economy, to be substantially contracted we should spend less money on the railways and more on the highway system. If it turns out on inquiry that the relative proportions of rail and of road transport equipment are about right so much the better. But until there is a clear picture of the ultimate pattern of the transport system of the country our transport policy, as a whole will be liable to drift and capital investment in transport to be devoid of firm guiding principles.
If we had this clear picture many subsidiary but important questions would fall into their proper place. The railways would be able to proceed much more rapidly and extensively with the closing of branch lines (if this is the right ultimate policy), the transport requirements of trade, industry, agriculture and markets could be progressively related to a known pattern and the railways might be able to secure additional financial resources by the disposal of land or other property if it proved to be surplus to the requirements of a fully integrated system.
11. I do not think that the comprehensive inquiry which would be necessary to explore and establish the facts and possibilities on which a national transport policy could be built could properly be undertaken by the Commission. Not only is it faced with an immense task in the day to day administration of its vast undertaking, and preoccupied with railway finances and its relations with labour, but the scope of the inquiry would far transcend the Commission's range of activities. The Commission is concerned with only a small, although very important, fraction of road transport, and is not directly interested in the economics of the highway system. Moreover, the great bulk of its expert staff, to say nothing of its workpeople, are bound to favour strongly the particular form of transport with which they have been associated during their working lives.
In my view it is imperative that this task should be put in hand without delay. Having regard to its magnitude and importance and of the necessity that those undertaking it should have the fullest access to all available facts, I do not think that it could be undertaken by any body short of a Royal Commission.
12. The question of a subsidy to the Commission has been frequently raised. It would I think, be a most unwise step to make any kind of annual subsidy to the Commission for the purpose of reducing its charge, whether for passengers or goods. There is no reason why users of the Commission's services should not pay for them what they cost to provide, including the moderate remuneration provided in the Transport Act for the capital employed. The machinery of the Transport Act should be sufficient to see that these charges are fair to the public and fairly distributed over the different types of user. The defects of this machinery during a period of steeply rising costs do not destroy its value and effectiveness for more normal times. A revenue subsidy would, moreover, diminish the pressure on the Commission and its Executives to make financial ends meet by their own efforts, and would certainly do nothing to discourage demands by the Commission's personnel for higher wages and improved conditions of service. The accumulated deficiency of net revenue is not yet so large as to be unmanageable over a period of years without any serious impact on charges. A case could, possibly, be made for a subsidy to cover the accumulated deficiency of net revenue when costs have become stabilised. It would, I think, be unwise to consider a subsidy earlier to liquidate the deficiency in net revenue because it might set up a precedent for an annual contribution until comparative stabilisation of costs is reached.
A capital subsidy would hardly be justified. So long as the Commission can borrow at reasonable rates it would have to be a very large subsidy to give material relief to the revenue position.
13. Briefly, therefore: —
(a) The accumulated revenue deficiency of the Commission is not, so far, of unmanageable size and is due primarily to the lag between unavoidable increases in the Commission's costs and the authorisation of increased charges necessary to meet them. The Commission's finances are not, in fact, moving towards disaster.
(b) This lag and the consequential deficiencies in revenue arising from it are due to the procedure laid down in the Transport Act for controlling the Commission's charges. Legislation should be introduced to enable the Commission to adjust their charges subject to subsequent ratification by the Tribunal.
(c) Although progressive economies are to be expected these are not likely to be of such a character as to modify substantially the financial position of the Commission or materially to affect the level of its charges.
(d) Provided that the Commission are enabled to adjust their charges to their necessary expenses as is done in trade and industry generally, there is no reason why they should not attain and maintain financial equilibrium as soon as prices become more stable.
(e) There may possibly be a field for substantial economies in a radical modification of the transport system. An examination of this very large and intricate problem should be undertaken by a Royal Commission.
(f) There is no strong case for a Government subsidy to the Commission at present.
A. B.
Ministry of Transport, W. 1, 10th September, 1951.
### ANNEX A
**Net Book Value of Fixed Assets, Gross and Net Operating Receipts**
| | Net book value of fixed assets as at 31st Dec., 1950 | Gross receipts (operating) 1950 | Net operating receipts (before deducting central charges) 1950 | |----------------------|-----------------------------------------------------|---------------------------------|---------------------------------------------------------------| | | £ | £ | £ | | British Railways (including collection and delivery and other road services) | 1,138,823,974 | 349,630,770 | 23,554,671 | | *Road Haulage (British road services)* | 38,227,141 | 62,473,177 | 1,108,476 (Deficit) | | *Road Passenger Services: Provincial and Scottish* | 35,357,261 | 38,673,331 | 3,389,685 | | **London Transport Road Passenger Services** | | | | | Buses and coaches | 23,749,280 | 30,788,755 | 1,904,649 | | Trolleybuses | 4,540,589 | 8,169,350 | 438,683 | | Trams | 3,295,319 | 2,559,984 | 1,254,172 (Deficit) | | **London Transport Railways** | 104,244,448 | 15,032,594 | 659,411 | | Ships | 7,857,521 | 11,412,052 | 2,850,010 | | Inland Waterways: Carrying operations | 311,336 | 693,638 | 93,795 (Deficit) | | Inland Waterways: Other than carrying operations | 68,503,916 | 12,497,706 | 54,847 | | **Hotels and catering** | 23,501,433 | 1,589,834 | 154,129 | | **Commercial advertising** | 9,155,738 | 14,770,936 | 612,696 | | **Letting of sites, shops, &c., on premises and properties in use for transport purposes** | | | | | **Generation and distribution of electric current** | 14,045,780 | | | | **Land and buildings not in use for transport purposes** | 34,076,983 | | | | **Miscellaneous** | 40,048 | | | | **Total** | 1,505,730,767 | | | | **Deduct—Assets Displacement Account** | 164,370,613 | | | | **Net Total** | 1,341,360,154 | | |
- Excludes £60,279,546 goodwill. This amount is shown in the balance sheet and covers—
1. an estimate of the amounts payable for compensation for cessation of business and severance in respect of road haulage undertakings compulsorily acquired. It may be a considerable time before the amounts payable under these heads are finally ascertained;
2. amounts included for goodwill in the consideration (partly estimated) for road passenger and road haulage undertakings acquired by agreement or in the price paid for shares in such undertakings;
3. amounts included for goodwill in the valuations put upon interests in road passenger and road haulage companies transferred from vested undertakings.
### ANNEX B
**Main Lines' Increases in Charges**
| Percentage level over pre-war to which raised | From 1st May, 1940 | From 1st Dec., 1940 | From 1st July, 1946 | From 1st Oct., 1947 | From 15th May, 1950 | From 16th April, 1951 | |-----------------------------------------------|-------------------|-------------------|-------------------|-------------------|-------------------|-------------------| | Fares (other than workmen's and seasons) | 10 | 16½ | 33½ | 55 | 55 | 55 | | Workmen's fares and season ticket rates | 10 | 10 | 25 | 55 | 55 | 55 | | Charges for parcels and miscellaneous traffic by passenger train | 10 | 16½ | 33½ | 55 | 81 (approx.) | 99 (approx.) | | Charges for goods train traffic | 10 | 16½ | 25 | 55 | 81 (approx.) | 99 (approx.) | CABINET
THE COAL TRANSPORT SITUATION
Memorandum by the Minister of Fuel and Power
The memorandum by the Minister of Transport (C.P. (51) 237) reveals a most disturbing prospect. With the present shortage of man-power on the railways, it seems more than likely that the transport facilities of the country will be unable to move the whole of the coal output. Indeed, a shortage of wagons at the pits is already appearing. Since the resumption of Saturday working, certain pits in the East and West Midlands and in Scotland have only had sufficient wagons at the beginning of the day to cover the requirements of the morning shift, and, in one or two cases, not even that.
2. In view of the difficulties experienced last winter - difficulties which continued, contrary to all previous experience, through the spring and into the summer - and of repeated warnings by the railways that the position, short of remedial action, would worsen during the coming autumn and winter, arrangements were made some time ago to increase the transport of coal by road, canal and sea. But I am afraid they will be nothing more than a palliative; the bulk of the coal must be carried by rail, and the root problem of ensuring sufficient rail transport remains.
3. Although I have not received all the material needed for drawing up next winter's coal budget, it is already clear that we shall have difficulty both in meeting essential requirements at home and in maintaining exports at the level laid down by the Production Committee earlier in the year. We shall also have acute difficulty in providing the large coal required by the gas works and to the domestic consumer; the stocks of these consumers are now well below the target level.
4. It follows that, if a major breakdown in distribution affecting both industry and the domestic consumer is to be avoided, rail transport facilities must be such as to ensure that all the coal produced is moved promptly to its destination.
5. The effect of a shortage of transport on the miner himself must not be overlooked. It would be disastrous if the men were to find, in responding to the appeals which have been made to them for more output, that coal had to be placed on the ground, or, worse still, that pits were brought to a stop for want of transport for the coal.
6. By co-operation between the Railway Executive and the National Coal Board much has been done not only to transfer traffic from rail to other forms of transport but also to reduce the burden on the railways by the re-routing of traffic, by the make-up of through trains (so as to avoid marshalling and shunting at congested junctions). But, as the Minister of Transport indicates in C.P. (51) 237, this will not be enough, and indeed the National Coal Board have been clearly warned by the Railway Executive, with whom they are in daily contact on these matters, that even when all these steps have been taken they think it unlikely, unless the staff position is improved, that the railways will be able to carry the usual proportion of the coal output.
7. I am, therefore, alarmed by the Minister of Transport's statement in paragraph 4 of C.P. (51) 237 that there is no reason to expect any improvement in ratio of staff recruitment to wastage during the autumn and winter when working conditions worsen. In the light of this and the other considerations I have given, I have no alternative but to urge my colleagues to support the Minister of Transport in taking whatever measures will effectively increase the man-power on the railways during the coming winter months.
P.J. N-3.
Ministry of Fuel and Power, S.W.1.,
13TH SEPTEMBER, 1951. Interdepartmental discussions between the Ministry of Labour and National Service, the Home Office, the Scottish Home Department and other Departments have been taking place for some months about the whole-time man-power which would be required in war for the Rescue and Pioneer Sections of the Civil Defence Corps, and for the Fire Service (additional to the peace-time strength of the Fire Brigades). These discussions have now reached a point where guidance on broad policy is required from Ministers.
2. The requirements of whole-time man-power are roughly estimated by the Home Office and Scottish Home Department at 200,000 men in the case of the Rescue and Pioneer Sections of the Civil Defence Corps and 175,000 men in the case of the Fire Service. These figures do not purport to be precise estimates and, in any case, the actual figures would depend, among other things, on factors which are at present uncertain, e.g., on the date when the men will be required and the equipment which could be made available for them by that date. For planning purposes, however, they are regarded as reasonable estimates of the order of magnitude of the man-power required.
3. To meet these requirements, the Civil Defence Services have no trained reserves corresponding to either the Regular Reserves of the Armed Forces (including National Servicemen), the Territorial Army and other Volunteer Reserve and Auxiliary Forces, or to Class 'Z' and equivalent Reserves. Recruitment for Civil Defence and the Fire Service is at present proceeding on the basis of part-time commitments both in war and in peace, and the number of men enrolled, even on this basis, is only some 15,000 in the case of the Rescue and Pioneer Sections of the Civil Defence Corps and some 7,500 in the case of the Auxiliary Fire Service.
4. Obviously, the ideal plan from the point of view of the Home Office and Scottish Home Department would be to fix a target date by which an agreed number of trained men should be available for call-up on the same basis as the Reserves of the Armed Forces. To achieve this object in any reasonable time or on the basis of anything like the figures indicated in paragraph 2 would be wholly impracticable within the framework of current Defence policy and even to build up Reserves on a smaller scale and on a lower standard of training would necessitate a great intensification of effort in the way of provision of facilities for training in peace-time. It is no part of the purpose of this paper to suggest any revision of decisions recently taken by the Cabinet as to the scale on which Civil Defence preparations should proceed, and it is recognised by the Home Office and Scottish Home Department that it is their responsibility to develop their organisation for the purpose of providing Civil Defence and Fire Service Reserves within the limits of policy as it stands.
5. It would, however, be unrealistic and uneconomical to embark upon plans for expanding existing training facilities in order to cater for the intake and training of large numbers of Reservists unless preparations are made at the same time to ensure that, at the opportune time, there should be a flow of recruits at a rate proportionate to the capacity of the facilities thus provided. It is, therefore, essential at an early stage that concurrent examination should be made of this problem.
6. It is highly desirable on every ground that the numbers required should be obtained on a voluntary basis, and it is agreed that the Home Office and Scottish Home Department should, as soon as they are ready (i.e., when they are in a position to give, at any rate broadly, an indication to volunteers of what would be their conditions of service in war), launch and press with the utmost vigour a campaign designed to secure both from those who have already enrolled on a part-time basis, and from other sources, as many volunteers for whole-time service in war as possible. There is, however, nothing in past experience to justify the hope that anything like sufficient numbers are likely to be obtainable in this way, or that those obtainable will be obtainable at the right times or in the right places. There can be no doubt that the only way of obtaining satisfactory results would be by the introduction of a measure of compulsion in peace-time and the Cabinet are invited to consider whether provisional preparations for doing so should now be made or whether we must accept the inescapable alternative that these Services will not be adequately manned at the outbreak of war. The details of any measure of compulsion would require careful study. Its main objective should be to secure that an appropriate number of men are registered in a Reserve with obligations of immediate call-up in the event of war in the same way as in the case of the Armed Forces; the actual numbers to be called up would be regulated according to the facilities available for handling them. The two main questions which would arise are:
(a) what classes or groups of men should be made liable for compulsory enrolment; and
(b) what, if any, liability for training in peace-time should be imposed upon them?
Both these are questions which need further examination in detail, but broadly it is contemplated that this examination should be based on the following principles:
(a) Without excluding the possibility of obtaining a proportion of the requirements either by way of a percentage of the annual intakes of National Servicemen or by imposing obligations upon older men who had experience of civil defence or fire service in the last war, main reliance should be placed upon the call-up of young men in their age groups, starting at age 25 and excluding from the field Regular Reservists (including National Servicemen during their period of part-time service), members of the Territorial Army and other Volunteer Reserves and Auxiliary Forces, "Z" Reservists selected and available for recall, and men who ought to be reserved for Industry; the obligation in war would be to serve in Civil Defence for a limited period, until they were required and could be made available for call-up to the Armed Forces, which meanwhile would have sole call upon men up to age 25.
(b) There should be a limited period of annual training; it would not be possible to fix this so high as to provide that all Reservists were fully trained in peace-time (it is estimated that for this purpose a period of continuous training of six weeks would be required), but consideration should be given to the possibility of varying training periods for different parts of the country, designed, e.g., to secure that special provision could be made for the case of London.
7. The Minister of Labour and National Service is in general agreement with this paper.
8. The Cabinet is accordingly invited -
(i) to note that without compulsory enrolment and training in peace-time the Civil Defence Services cannot be ready to operate at the outbreak of a war; and
(ii) to decide whether a Bill should be prepared to confer the powers necessary for the purposes indicated in paragraph 6, on the understanding that it would be held in reserve until a decision can be taken on the practicability of introducing compulsion in peace-time.
J. G. E. H McN
14TH SEPTEMBER, 1951. MAN-POWER REQUIREMENTS OF THE POLICE AT THE OUTSET OF ANY MAJOR WAR
Memorandum by the Home Secretary and the Secretary of State for Scotland
This paper, prepared in consultation with the Ministry of Labour, is complementary to our paper setting out the needs of the Civil Defence Services for trained men required for whole-time service from the outset of a major war.
2. In order to discharge the additional war-time tasks which fall to the police, it is estimated that police forces will require an increase of 50% over their peace-time establishment of approximately 80,000 men; the war-time male police establishment has therefore been fixed at 120,000. The present male strength of police forces in England, Wales and Scotland is approximately 67,800 but account must be taken of the numbers of reservists of the Armed Forces in the police who will be required to return to the Fighting Services on the outbreak of war. The numbers of men required to bring the police up to full strength in war fluctuates according to current police strength, and the numbers of reservists, but it is of the order of 55,000 to 60,000. In addition 1,000 women will be required for full-time police duty.
3. As regards part-time man-power, it is considered that it will not be necessary to expand the peace-time cadre of the Special Constabulary; the maximum strength authorised for the Special Constabulary in peace-time is approximately 160,000. The present strength of the Special Constabulary in Great Britain is 76,000, so that the police would need to recruit a further 84,000 Special Constables in order to reach their maximum peace-time strength. In addition there would be a need for a small number of women Special Constables.
4. During the last war a certain number of conscripts elected to serve in the police. The experiment was not altogether a happy one and showed that, although some conscripts exercised police powers satisfactorily, as a general rule it was undesirable to entrust to conscripts the extensive powers affecting the general public which appointment as a policeman confers. Apart from this, policemen work very largely as individuals and must be trusted to do their jobs honestly and conscientiously: an unwilling conscript would be virtually useless. In the circumstances, the measures proposed to recruit men for the Civil Defence Corps and the Fire Service by means of conscription should not, it is felt, be extended to the police service in peace-time, even though conscription for the police in war-time might have to be considered as a last resort.
5. It appears therefore that for the time being reliance should continue to be placed on the volunteer system to obtain the additional man-power required for the police. In view of the presumed nature of a future war, it is desirable to obtain and train such volunteers prior to active hostilities; apart from the Civil Defence considerations which make this necessary for the Civil Defence Corps and the Fire Service, the police have in addition to their Civil Defence tasks special responsibilities at the beginning of war, such as the control of aliens. The existing training facilities are estimated to be capable of training all volunteers likely to be forthcoming.
6. In order to stimulate voluntary recruitment, it is desirable to place the minimum restrictions both on candidates for the Special Constabulary and on men prepared to give full-time service in war. Prior to the Defence Committee's decision of 27th July, 1949 (D.O. (49) 18th Meeting, Minute 3) there was no restriction on the recruitment of Special Constables other than a minimum age limit of 18 and the necessity for a candidate satisfying the necessary standards as to height, fitness, integrity, nationality and education. In view of the complete reliance which must be placed on voluntary recruitment for the police it is desirable that any suitable (on pre-July 1949 standards) volunteer, either for part-time service or full-time duty, should be permitted to enrol, provided that the candidate is neither a reservist whom the Service Departments require for mobilisation in the early months of an emergency, nor engaged in a full-time civilian calling essential to the war effort.
7. The following proposals are therefore put forward for the field of recruitment for men prepared to undertake full-time police service in war:
(i) Men between 25 and 50, other than those in the Armed Forces or the Territorial or Auxiliary Forces, including the National Service Reserve, or those in vital occupations;
(ii) "Z" or equivalent reservists, other than those selected for early recall by the Service Departments or in vital occupations;
(iii) Retired Officers recruited with the prior approval of the appropriate Service Department.
8. The field for recruitment for part-time service in the Special Constabulary should be similar, except that a vital civilian occupation would not debar "spare time" service as a Special Constable.
J. GE. H McN
14TH SEPTEMBER, 1951. THE MAN-POWER POSITION ON THE BRITISH RAILWAYS
Memorandum by the Minister of Labour and National Service
In his paper (C.P. (51) 237), the Minister of Transport asks that further consideration should be given to the request for the deferment of the calling-up of about 2,900 young railwaymen. This is the same proposal that he put forward originally in his paper (C.P. (51) 215), and which the Cabinet decided against as recently as 26th July (C.M. (51) 55th Conclusions, Minute 5). I am still strongly of the opinion that it is undesirable to defer the calling-up of railway workers and I can find nothing in the Minister of Transport's new paper which was not in substance before the Cabinet when this question was considered.
I should like to recapitulate very briefly the main arguments in my earlier paper. These were as follows:
1. It is only by the maintenance of the principle that the obligation to perform national service in peace time is of almost universal application that we can hope to continue to have general public support for the policy;
2. If a breach in the almost universal application of national service were allowed in favour of the railways, how could we refuse to grant applications for the deferment of calling-up of young men in other important industries and services which are also short of labour? Despite the fact that it must have become well-known that deferment on industrial grounds will not be granted, my Department has, since the beginning of 1950, received representations for the deferment of young men in nearly twenty industries or sections of industries. In particular, if deferment were granted to relatively unskilled men of 18 on the railways, how could it be refused to young men in, for example, the engineering industry who have become skilled on completing lengthy apprenticeships at about the age of 21 and are employed on very important work connected, for example, with rearmament? Apart, therefore, from the serious danger that if deferment were once granted on any scale it might be difficult to maintain national service at all, the effect on the numbers of men available to meet the needs of the Armed Forces might be very serious. Despite the removal of the agricultural blanket and the acceptance by the Services of some men in medical categories III and IV, we expect to be about 17,000 short of the numbers of national servicemen the Services need during the current financial year, and I suggest that we dare not run the risk of being substantially shorter still. If deferment were once granted on any scale, we shall find ourselves having to adopt the very unpopular course of imposing a still longer period of whole-time national service on the young men who were called up.
3. If a decision were taken to grant deferment to railwaymen, or to other workers such, for example, as draughtsmen, it would be wrong to do it on the basis of 'block' deferment of a whole grade of workers in an industry. The only method that would be fair to the individual and at the same time in the national interest would be to give all employers the opportunity to apply for deferment in respect of their employees on the grounds of the importance of the work to the national effort. This would have two results. In the first place, it would require the resuscitation of the war-time machinery of deferment involving the re-establishment of the Man-Power Boards, of which there were forty-four during the war. Secondly, it would mean that there would be a most serious shortage of national servicemen for the Forces. This could only be made good by a substantial extension of the period of national service.
4. I ask my colleagues to re-affirm the decision they took on 26th July.
A. R.
Ministry of Labour and National Service, S. W. 1.,
17TH SEPTEMBER, 1951. CABINET
BAMANGWATO AFFAIRS: TSHEKEDI KHAMA
MEMORANDUM BY THE PARLIAMENTARY UNDER-SECRETARY OF STATE FOR COMMONWEALTH RELATIONS
The three observers sent to Bechuanaland (C.M. (51) 51st Conclusions, Minute 3) have now reported, and Mr. Gordon Walker regrets that he must trouble his colleagues again with the question of the Khamas and the Bamangwato Reserve. As usual, there are some very awkward aspects of the question to decide, though the main issue is simple enough. The main question for decision, as Mr. Gordon Walker sees it, is in Section B of this memorandum. In Section A, I give the main developments since this matter was last considered by the Cabinet.
A.—Recent Developments
2. Despite one unseemly quarrel in public the observers have sent in clear, and on the whole, useful reports (Annexes B and C).
3. Mr. Bullock and Professor Macmillan have put in a joint report. They explain very clearly why it is impossible for Tshekedi to return as a private citizen (Annex B, paragraph 33). It is not so much, they say, a question of Tshekedi's ambition or honesty as of his status as the senior man in the tribe whilst Seretse is away. So strong is the sense of hereditary hierarchy that he would in fact be leader of the tribe. Mr. Bullock and Professor Macmillan say that memories of Tshekedi's high-handed acts are still vivid. The great majority of the tribe do not want Tshekedi back because he would rule over them and they fear the reactions of his authority.
4. It was largely for this reason that the present tribal leaders refused to agree to a joint kgotla. They said that Tshekedi had voluntarily withdrawn himself and joined another tribe. Were he now to be admitted to a kgotla this would automatically mark his reincorporation into the tribe and from that moment his hereditary authority, of which he cannot divest himself, would come into force.
5. On 11th August the observers reported to the Secretary of State their failure to get a joint kgotla and unanimously recommended that he should abandon this idea and let them assess the views of the tribe about Tshekedi's return by means of local kgotlas in every part of the tribal territory. On the 13th the Secretary of State accepted this recommendation and agreed that endeavours to hold a joint kgotla must be abandoned.
6. The one issue before the observers was to report on the attitude of the tribe towards the question of Tshekedi's return to the Reserve in a private capacity. On this issue they give a clear answer:
(a) Mr. Bullock and Professor Macmillan say—
"On this one question we have no hesitation in declaring that the return of Tshekedi Khama in any capacity whatsoever at the present time and in the present circumstances would be contrary to the wishes of the majority of the tribe and bitterly resented by a substantial number. On this issue emotions now run dangerously high through the tribe."
(Annex B, paragraph 31.)
(b) Mr. Lipson, in a separate report, is less unqualified but comes to essentially the same conclusion (Annex C, paragraphs 20 and 21). In effect he says... that the feeling against Tshekedi is not as tense as it appears because there was intimidation by his opponents, who are now in control of the tribe. Had Tshekedi attended a joint kgotla he might have influenced many to change over to his side. Mr. Lipson puts it as follows: "My own view is that, in spite of all that Tshekedi could have done, there would still have been a substantial majority against his return, so long as Seretse remained in exile. The chief fear of very many of those who were opposed to Tshekedi's return would probably be removed had Seretse also been allowed to return. They would, for the most part, acquiesce in his return, if Seretse were back in the tribe as chief and agreed that Tshekedi might rejoin the Bamangwato. Meanwhile, conditions in the tribe are deteriorating owing to lack of strong leadership."
It will be seen that in the first few lines of this passage Mr. Lipson's views on the question put to the observers are clear; but he has felt it necessary to introduce the question of Seretse's return, which was outside his terms of reference.
7. In private conversation Mr. Lipson told the Secretary of State that he thought we ought to take the risk (which he agreed was very considerable) of letting Seretse and Tshekedi Khama back. It is quite possible that he may say something like this in public. Mr. Bullock and Professor Macmillan were, on the other hand, quite clear that it would be a mistake to allow either of them back. On the issue on which they were asked to report the observers have given a clear verdict which justifies the Government in continuing to maintain the exclusion of Tshekedi from the Reserve.
B.—The Issue
08. The Secretary of State is under an obligation, given in Parliament, to publish the observers' reports. They must be accompanied by some statement or reaffirmation of Government policy—the situation in the Reserve in itself demands this. Mr. Gordon Walker therefore wishes to remind his colleagues of the considerations which had to be taken into account when the previous decision was taken and which in his opinion are still as strong.
09. The Secretary of State considers that, if the internal situation in the Reserve could be looked at in isolation, it would be a fair point that we could make the tribe happy if we let both Seretse and Tshekedi Khama back. They might fall out in due course and the fact that Seretse had a white wife and half-caste children would be used against him in any dissensions that might arise and would weaken his authority. In the end tensions and divisions might well become grave. However, in the short run the tribe would doubtless be happy.
10. There is also the consideration of public opinion here. Certainly the issue has become one of which the public is aware, but there is no evidence that there is any widespread public concern. For instance, since Tshekedi started his campaign in June Mr. Gordon Walker has received, either direct or through MPs., letters from only forty persons about this issue—a good many of these came from one or two places where Tshekedi spoke and someone obviously organised a letter-writing campaign.
11. Despite the apparent absence of widespread public concern at present, it has, however, now become such a celebrated cause that it could build up again into a big issue at any time. Tshekedi Khama has announced his intention of returning to England to pursue his campaign against the exclusion order against him. He said recently at the conclusion of the observers' visit—"This is not the end. It is only the beginning." But he will probably postpone his visit to this country in view of the general election. This is also likely to crowd out or postpone any real volume of criticism. In any case Mr. Gordon Walker doubts whether the Conservatives will again try to make capital out of the Tshekedi question. They are divided and many of them have, Mr. Gordon Walker thinks, been impressed by the warnings given by Mr. Strauss, the leader of the Opposition in the Union Parliament on his recent visit to England, and by Sir Evelyn Baring. They will probably also be deterred by the realisation that it is hard to separate the issues of Tshekedi Khama and Seretse Khama.
12. The Secretary of State has carefully considered whether it would be possible to let Tshekedi go back while maintaining the exclusion of Seretse. They have both been excluded, but a distinction can be drawn between their cases. Seretse was excluded on account of a specific act of his own which could be regarded as unfitting him for the chieftainship. Tshekedi, on the other hand, was not excluded on account of any blameworthy action of his own but because, if Seretse was to be excluded, fairness—and perhaps the maintenance of order—required that Tshekedi should not remain in the Reserve. If we let Tshekedi back now, there would certainly be disorders at first in the Reserve, but Tshekedi might thereafter succeed in asserting his authority. On the other hand, the disorders in the Reserve might be serious. Tshekedi himself has said to Protectorate chiefs that, if he is allowed to return to the Reserve, he would work for Seretse's return. In order to maintain his position in the Reserve, he would probably have to press the Government for Seretse's return, even though he might otherwise be reluctant to do so. In these circumstances the pressure of public opinion outside Parliament in favour of Seretse's return would be very strong. We have always grounded our policy on the need to exclude both from the Reserve, and it would be difficult for us to sustain the case for keeping out Seretse if we let Tshekedi back, unless we were prepared to confess that we were yielding to fear of South African reactions. Moreover, we should be overriding what the observers regard as the views of a substantial majority of the tribe. The Commonwealth Secretary believes that we should ultimately be forced to allow Seretse back if we once allowed Tshekedi in and in the last resort he would prefer to go the whole hog and let Seretse back simultaneously rather than be pushed along reluctantly to allow him back in the end.
13. Therefore in practical terms the question is whether to let both Seretse and Tshekedi back or to continue to keep both of them out. The issue for the present is whether Tshekedi and Seretse be excluded now. When, however, the White Paper period ends in 1955, Mr. Gordon Walker thinks that, in view of the distinction between their cases to which I have referred, it is conceivable that Tshekedi might then be allowed to return. He sees no possibility of Seretse Khama being allowed to return then.
14. The Commonwealth Secretary wishes to emphasise that, apart from the possibility of future trouble in the tribe if we let both go back, we have to consider the reactions of South Africa. We must never forget that these Territories are geographically and economically part of the Union.
All the evidence that Mr. Gordon Walker can get shows that Union reactions to Seretse's return would be very sharp and serious. (They do not mind one way or the other about Tshekedi.) This is borne out by Mr. Strauss, the leader of the United Party, who says that he could not oppose any course of action that Dr. Malan might take and that we must choose between Seretse's return and keeping South Africa in the Commonwealth. It is borne out by Mr. Paver, a progressive South African who runs the African vernacular press there and with whom Mr. Gordon Walker has had several talks. It is borne out by Sir Evelyn Baring. Finally, the United States Embassy in South Africa is understood to have made similar reports to Washington.
All these authorities say that white opinion in the Union would be so incensed by what they would regard as the official blessing of the British Government upon the principle of mixed marriage that it would unite behind a Government that was ready to take extreme action. We could no longer rely upon South Africa being actuated by rational motives; nor upon the political divisions that now prevent the Nationalists from pushing their views too far.
15. There are two sets of action that could be taken by a South African Government to our disadvantage:
(a) They might cease to co-operate in defence. They would certainly press on with demands for the cession of Simonstown. We could not count on their ready co-operation in economic and financial matters.
(b) They could make it virtually impossible for us to continue to administer the Territories. One of Dr. Malan's chief advisers has told us that Malan has said he would "blockade" the Territories if we let Seretse back. Dr. Malan did not say this for our information and does not know that we have been so informed. If South Africa were prepared to face economic disadvantages to herself she could cut off the Territories from essential goods and from their markets. She could also gravely reduce their already inadequate revenues. Whether or not South Africa would go so far as this, she would certainly very soon come forward with strong demands for the cession of the Territories, perhaps after fighting an election on the issue. 16. If we decided to reverse our policy about Seretse and Tshekedi, we would first have to make a careful study of how we should deal with an economic blockade of the Territories. There is, Mr. Gordon Walker thinks, little we could do—and even that would depend upon our spending very considerable sums of money, all of which might well be wasted. There would be a deplorable public conflict between ourselves and another Member of the Commonwealth which would be made full use of by every ill-wisher of the free world with incalculable results.
17. In any case (leaving aside the defence aspect) it seems to Mr. Gordon Walker that, if we let Seretse back, we should be running a high risk of losing the three Territories. This would, incidentally, profit Seretse not at all. For the sake of the not altogether undoubted rights of two men, we should be risking the liberties of nearly a million Africans. In the Secretary of State's considered view these risks are too great for us to run.
18. The Secretary of State therefore concludes in the light of all these considerations that he must recommend to his colleagues that the right course is to reaffirm the Government's policy as set out in the original White Paper (Cmd. 7913) and continue to exclude both Seretse and Tshekedi. He therefore proposes that, with the approval of his colleagues, he should issue a White Paper containing the observers' reports, together with an introduction briefly rehearsing the case, making it clear that the issue is limited to Tshekedi's return and showing that the observers agree that a majority of the tribe is against his return. This covering statement would then reaffirm the Government's policy as set out in the original White Paper. I annex a draft of the statement which Mr. Gordon Walker would recommend (Annex A).
19. The Secretary of State recommends the immediate publication of this further White Paper. The situation in the Protectorate is unsettled and the local Administration is anxious to be able to state clearly the Government's decision on the observers' reports. This will reassure the Bamangwato and steady the other chiefs who are under great pressure from Tshekedi. He recently called a meeting in Mafeking of chiefs and persuaded them to sign a petition highly critical of the Government and asking for the return to the Reserve of both Seretse and Tshekedi. The chiefs have since explained that they were stampeded into signature of the petition, although they did not concur in all its terms. Something of Tshekedi's ambitions is revealed by the line he took with the chiefs, namely, that they should all work for his return "to take control and restore order among the Bamangwato" in return for which he would undertake to work for the return of Seretse.
20. One difficulty which will have to be faced is the insistent demand from the tribe that those followers of Tshekedi Khama who went with him into voluntary exile should also be excluded from the Reserve. The Secretary of State feels very strongly that we cannot allow exclusion to be carried to this length and he intends to tell the tribe so very firmly. It is in the Government's interest that Tshekedi's followers (some of whom are very able) should re-enter the tribe as we do not want a system of councils to grow up consisting exclusively of Seretse's adherents.
C.—Conclusions
21. Mr. Gordon Walker therefore makes the following proposals:
(a) To reaffirm the Government's policy to exclude both Tshekedi and Seretse Khama for a period of "not less than five years" from March 1950, as prescribed in the original White Paper (Cmd. 7913).
(b) To publish a White Paper embodying the observers' reports and conveying the decision at (a).
(c) To make clear to the Bamangwato tribe that we cannot give way to their pressure for the exclusion of Tshekedi's followers and that the latter must be received back into the tribe if they wish to return.
Commonwealth Relations Office, S.W. 1, 22nd September, 1951. ANNEX A
DRAFT TEXT OF WHITE PAPER
In July His Majesty's Government invited Mr. H. L. Bullock, Mr. D. L. Lipson and Professor W. M. Macmillan to visit the Bamangwato Reserve in the Bechuanaland Protectorate to report on the attitude of the Bamangwato tribe to the return of Tshekedi Khama to the Reserve as a private person. Mr. Bullock and Professor Macmillan have submitted a joint report and Mr. Lipson a separate report to the Secretary of State for Commonwealth Relations.
His Majesty's Government have carefully considered the reports and wish to record their thanks to the observers for the diligence and thoroughness with which they performed their task.
As stated in the White Paper on the succession to the chieftainship of the Bamangwato tribe (Cmd. 7913) a judicial enquiry was held in 1949 under the Bechuanaland Protectorate Native Administration Proclamation into the question of the recognition of Seretse Khama as chief of the Bamangwato tribe. The judicial enquiry unanimously advised against the recognition of Seretse and recommended that his absence from the Protectorate was essential to the peace and good order of the Bamangwato Reserve. They also recommended that Tshekedi Khama, who had earlier gone into voluntary exile in a neighbouring tribal area, should not be permitted to return to the Reserve. His Majesty's Government's decisions, whereby Seretse Khama is required to remain outside the Protectorate and Tshekedi Khama to reside outside the Bamangwato Reserve for a period of not less than five years, were fully set out in the White Paper (Cmd. 7913) published in March 1950.
In April 1951, Tshekedi Khama visited London and made representations to the Secretary of State for Commonwealth Relations against the order excluding him from the Bamangwato Reserve. The Secretary of State was unable to accede to Tshekedi's request, but offered him certain conditional facilities to enable him to care for his private interests in the Reserve. Tshekedi Khama rejected this offer. Subsequently the following motion was debated on 26th June in the House of Commons:
"That this House deplores the decision to continue the banishment of Tshekedi Khama from the Bamangwato Territory without hearing or inquiring into the grounds for such banishment; and calls upon His Majesty's Government to rescind the order of banishment and allow him to dwell freely within the territory of his tribe."
The motion was defeated.
In the course of the debate on this motion the Secretary of State for Commonwealth Relations offered on behalf of the Government to invite the tribe to hold a further kgotla (tribal meeting), attended by Members of Parliament as observers, to ascertain the tribe's attitude to the return of Tshekedi Khama as a private person. Since the Opposition parties were unable to agree that any of their members should go to Bechuanaland to attend the proposed kgotla, it was not possible to arrange a Parliamentary delegation. His Majesty's Government therefore invited Mr. H. L. Bullock, past president of the Trades Union Congress, Mr. D. L. Lipson, member of the Gloucester County Council and formerly M.P. (Independent) for Cheltenham, and Professor W. M. Macmillan, Director of Colonial Studies at the University of St. Andrews, to go to the Bamangwato Reserve with terms of reference requesting them "to report on the single question of the attitude of the tribe to Tshekedi Khama's return to the Bamangwato Reserve as a private individual."
The observers left the United Kingdom on 24th July and arrived in the Bamangwato Reserve on 26th July. On 11th August they reported that they and the local Administration had been unable to secure the agreement of the present tribal leaders to a kgotla attended by Tshekedi Khama and his followers. They therefore unanimously recommended that this proposal should be abandoned and that they should proceed to assess the views of the tribe on the question of Tshekedi Khama's return by means of a series of local meetings in every part of the Reserve. On 13th August the Secretary of State accepted this recommendation and agreed that endeavours to hold a kgotla of the Bamangwato tribe, attended by Tshekedi and his followers should be abandoned. The observers then pursued their task by attendance at a series of local meetings. They also saw and talked with Tshekedi Khama and his followers, chiefs from other parts of the Bechuanaland Protectorate and the Paramount Chief of Swaziland. They returned to the United Kingdom at the end of August.
In the opinion of His Majesty's Government the reports of the observers, of which the full texts are appended, show that a substantial majority of the tribe is opposed to Tshekedi Khama's return to the Reserve. His Majesty's Government therefore see no reason to vary in any way the decisions set out in Cmd. Paper 7913, whereby Seretse Khama is required to remain outside the Protectorate and Tshekedi Khama to reside outside the Bamangwato Reserve for a period of not less than five years from March 1950. ANNEX B
JOINT REPORT BY MR. H. L. BULLOCK AND PROFESSOR W. M. MACMILLAN
I.—Background
In July last we were asked by the Secretary of State for Commonwealth Relations to undertake a mission in the Bamangwato Reserve of the Bechuanaland Protectorate. The object of our mission is best set out in the following extract from a letter addressed to us by Mr. Gordon Walker on 20th July:—
"As I have explained in the House of Commons, the purpose of your visit is to report on the single question of the attitude of the tribe to Tshekedi Khama's return to the Bamangwato Reserve as a private individual.
As I also told the House, I intend to invite the Bamangwato tribe to hold a special kgotla under the presidency of an impartial person in order to establish their views on this question. I will cause my invitation to the tribe to hold this kgotla to be presented to them at a meeting with the tribal representatives in your presence. I have made it clear to the House that in my view this kgotla should be attended by Tshekedi Khama and his followers.
I hope you will use your best endeavours and all the weight of your influence to persuade the tribe to agree to hold such a kgotla and to re-emphasise to them that Tshekedi Khama has renounced all claims to the chieftainship. I would be grateful for your views and advice on details of arrangements for the holding of this kgotla. Any decisions that have to be taken must of course be mine, but I shall much value your advice and recommendations. Please do not hesitate to consult and advise me on any matters you wish at any stage of your visit.
I of course leave to your judgment any steps besides the holding of the kgotla that you may decide to take to ascertain for yourselves the views of the tribe on the question at issue and to consult with neighbouring chiefs and any other people you may wish to see. You may count on the full co-operation of my officers in any such steps that you may see fit to take and in all other ways."
02. The circumstances in which the issue of Tshekedi Khama's return to the Bamangwato Reserve came before Parliament are well known and need be recorded here only very briefly. For 23 years 1923-49 Tshekedi Khama had ruled the Bamangwato people as Regent for his nephew, Seretse Khama, the heir to the Chieftainship. During all these years Tshekedi had been in the position of father and mentor to Seretse and had cared for his affairs within the Reserve. Differences arose between them over Seretse's marriage in 1948. The tribe also was divided on this matter, and at the instance of Tshekedi, a series of kgotlas was held to discuss his position. Later a judicial commission was appointed to enquire into the circumstances that had arisen. In consequence of that commission it was decided by the Secretary of State that the chieftainship should be held in abeyance for five years and that Seretse Khama should for that period be required to live outside the Bechuanaland Protectorate. At the same time Tshekedi Khama was required to live outside the Bamangwato Reserve. These decisions, and the reasons for them, are recorded at length in the White Paper (Cmd. 7913) published in March 1950.
03. During the years of his regency, Tshekedi had cared for the cattle and other property that appertained to the chieftainship, to himself and to Seretse. In 1950 an effective distribution of this property was made. It is understood that, in fact, this distribution has given rise to disputes between the tribe, representing the chief, and Tshekedi, but such disputes will be a matter for the courts and do not concern this mission.
04. Since his departure, Seretse Khama has apparently experienced no difficulty in leaving his property within the Reserve to be managed by one Keaboka, fourth senior member of the chiefly family, who has since been nominated by the tribe as its leading representative and its "messenger" for the purpose of dealing with Government. Tshekedi, on the contrary, has not found it possible to leave his property to the care of a representative, and in 1950 sought and obtained the permission of the High Commissioner for a series of visits to the Reserve for the purpose of managing his affairs. These visits were made the subject of representations to the High Commissioner by representatives of the tribe, it being alleged..." that his presence in the Reserve was repugnant to the tribe, which was disturbed as to the intentions of both Tshekedi and Government. It is understood that the Secretary of State entered into prolonged negotiations with the intention of arriving at an accommodation with Tshekedi Khama that would secure to him adequate control of his property and yet be acceptable to the tribe. Those negotiations failed and the Secretary of State thereafter decided that the interest of peace and good order within the tribe demanded the re-enforcement of the exclusion order against Tshekedi Khama. Thereafter Tshekedi, having publicly renounced all claim to chiefship, demanded the right of free access to the Reserve as a private individual. The issue found its way to Parliament, in order to satisfy which the Secretary of State offered to send observers to the Protectorate to report on the true state of feeling within the Reserve.
05. The Bamangwato Reserve has an area of 40,000 square miles and a population roughly estimated to be 100,000 people. Of these only rather less than 20,000 belong to the Ngwato tribe proper, the remainder having from time to time broken away from their original tribes and affiliated themselves with the Ngwato tribe and acknowledged its supremacy. The Reserve is divided into nine districts, the chief of which is that surrounding Serowe, which is also the capital of the Reserve. The Serowe district is the stronghold of the Ngwato tribe proper, but a number of its members reside in the several districts and are normally amongst the most influential persons in them. The dominance of the Ngwato is ultimately due to the genius of Khama (1875-1923) who made his kingdom a rallying point for tribes scattered over the huge area in times when security was threatened from the North by raiding Matabele and from the South-East by the encroachment of European farmers. Khama's protection of the lesser tribes was made more effective by the backing he himself enjoyed from the Government of his great patron, Queen Victoria. Yet at that time, and even later, the protecting Government was in no position to assume what has come to be known as "direct" rule over this vast territory, so that from the beginning the Protectorate administration came to rely even for the maintenance of law and order almost entirely on the discipline enforced, until 1923 by Khama, and latterly by the Regent, Tshekedi. In consequence of this, native custom has been distorted and the power of the Chief raised considerably above any checks traditionally exercised by the people of the tribe over the chiefs' autocracy.
06. It was the great achievement of Khama's system that the rule he imposed through Bamangwato Representatives with the backing of the "regiments" from Serowe and ultimately of His Majesty's Government was loyally accepted and still is by the out-lying dependants. More than once some of us were corrected and told not to speak or think, e.g., of Bakalaka or Bakalanga, since all claim to be Bamangwato. Even if they have made little material progress these people were wisely allowed to retain their own tribal headmen and they continue to speak four or five distinct languages.
07. The Reserve, and all its people, are normally ruled by the chief, who occupies his position by right of birth. To each district he nominates a person known as the chief's representative, who rules on his behalf. The system is Khama's and the agents of the system, though they may constitute something like a civil service, were and still are drawn largely, though not now exclusively, from the members of Khama's family, being thus undoubtedly also a privileged aristocracy. Their Office clearly brings some profit as well as social prestige and they are intensely conscious and jealous of their order of precedence. In spite of the great almost untracked distances this ruling class maintain close links with each other and with Serowe, where they frequently gather for meetings, and where, as a result, tribal politics often have the intensity and ferocity of a village family dispute. The unity of the tribe is, nevertheless, something very real and jealously guarded, even if the system is thus aristocratic and, although not exclusively, autocratic. Certainly it admits of no organised opposition: to stand out against the ruling power on any major issue is to be guilty almost of treason.
08. Yet there are certain checks upon the use of power by the chief. The first of these is the kgotla, a meeting at which, in theory, every male adult member of the tribe has the right to attend and to be heard. We return to the point that the recent exclusion of Tshekedi's supporters is based on the ground that they have transferred their allegiance to another tribe, the Bakwena. Such kgotla meetings may take place at the village or district level, but it is accepted that all the great affairs of the tribe are discussed and determined in the presence of chiefs' representatives and tribal headmen meeting in formal kgotla at the Ngwato stronghold, Serowe. No vote is normally taken at such meetings. When all who wish have spoken the chief, or person presiding on his behalf, assesses the feeling of the meeting and announces his decision. In theory, as Tshekedi Khama had himself claimed lately, that decision may be his own and need not accord with the feeling of the meeting; in practice a strong chief can possibly go contrary to the views of the majority. The meeting in kgotla is, however, an essential part of the system of native rule and is accorded much respect by the Bamangwato as by other tribes of the Protectorate.
09. The second check upon the absolute rule of the chief is the devotion to tradition and to precedent embodied in the complex and unrecorded system of native law and customs. Tshekedi himself told us it is "case law." Arguments may and do arise as to the particular application of native law and custom. (e.g., as to the present claims of Tshekedi Khama), but custom is certainly a restraining force of some potency.
10. The Chieftainship of the Bamangwato has remained with the house of Khama, to which both Tshekedi and Seretse belong and which has included among its members some very remarkable Africans. Of these last Tshekedi Khama is acknowledged to be one, but all members of the very large royal family, whatever their personal merits, are to be reckoned with as people of influence.
11. The foregoing represents, in brief outline, the organisation of the tribe as it has existed for many years. It should be recorded that in recent months the Administration has been engaged, we understand with success, upon a series of reforms designed to establish more firmly the democratic principle. The intention is to establish councils on a new democratic model, comprising representatives nominated by the village kgotlas in each district of the Reserve, these councils being advisory to the chief's representatives, who would themselves be nominated by the district kgotlas and confirmed by the full (i.e., tribal) kgotla at Serowe. The district councils would in turn send representatives to a central council at Serowe, which would in due course become the constituted Native Authority, and in effect the executive, or working, committee of the tribal kgotla. In these reforms members of the subsidiary or "allied" tribes were to have equal standing with members of the Ngwato and, in fact, a number of them had been nominated both as chief's representatives and council members. All progress on these reforms ceased when the future of Tshekedi Khama came before Parliament. Then, as is well known, disturbances occurred within the Reserve.
II.—Moves towards a "Joint" Kgotla
12. We arrived in the Reserve on 27th July and were met by the High Commissioner and officials of the Administration, who most willingly placed themselves at our disposal and helped us in very way without in any way interfering with our judgment concerning the things we desired to find out. Indeed, we had made our minds up from the time of the appointment that nothing should prevent us from coming to our own conclusions; we made this quite clear to everyone concerned and it was appreciated by them.
13. We immediately addressed ourselves to the task of securing agreement to a special meeting of the tribe in kgotla with Tshekedi Khama and his supporters present. It had been hoped that the invitation to convene such a kgotla would be extended, and the arrangements for it discussed, at a meeting attended by representatives of both the tribe and Tshekedi (the latter had not himself yet returned to Africa). We were informed that the tribal representatives had resolutely refused to attend such a meeting and we perforce agreed to see the parties separately. We saw representatives of the tribe on 29th July and the supporters of Tshekedi, headed by Rasebolai, on 30th July. On each occasion the invitation to take part in the joint kgotla was extended on behalf of the Secretary of State by the High Commissioner (on 29th July by Sir Evelyn Baring, and after his departure, on the 30th by Mr. R. E. Turnbull). On the morning of the 29th the tribal representatives merely welcomed us as their guests and said that they were empowered to listen but not to answer. They agreed to meet us again, for informal discussion, in the afternoon, but, in the event, maintained the same attitude. They would not give us a precise date for their reply, but, upon our representations of urgency, promised that it would be soon. On 30th July the supporters of Tshekedi welcomed the proposal for a joint kgotla and promised their full co-operation. It can be stated that on that occasion, and on every subsequent one of our meetings, the supporters of Tshekedi gave every evidence of desiring to face their opponents at a joint meeting. It was clear that our difficulties in arranging it would lie only with the established representatives of the tribe.
14. We also had informal talks with the lawyers representing both sides of the dispute stressing all the time the need for a large tribal kgotla with both sides present and taking part in the discussions so that we could obtain a free, fair and independent expression of opinion on the issue before us.
15. Meanwhile, on 30th July, a meeting stated to be representative of the tribe had been convened in kgotla at Serowe and a reply on behalf of the tribe to the Secretary of State's invitation reached us through the District Commissioner on 31st July. The reply was to the effect that the tribe regretted that only under the presidency of Seretse, Tshekedi's one senior in the tribe, would it be possible under Bamangwato law and custom to permit Tshekedi's presence. It went on to suggest that the interests of all would be best served if we agreed to travel throughout the Reserve and make direct contact with the people in the villages and towns.
16. At our invitation a small deputation, led by Keaboka, visited us informally on the morning of 1st August. They enlarged to some extent upon the reasons for the refusal (these reasons will be discussed later in this report) but were clearly unwilling to amend their attitude.
17. The refusal was firm, but we were not then disposed to accept it as final. It was, nevertheless, obvious that any process of persuasion would be prolonged and might even then be unsuccessful. It therefore appeared to us to be the wiser course to adopt, as an interim measure, the suggestion of the tribal representatives for a series of district meetings, in arranging which they were prepared to co-operate. It seemed, indeed, that quite apart from the knowledge we would gain of the Reserve and its people a programme of such meetings might be the best means of establishing confidence in our mission and thereby persuading the representatives of the tribe of the wisdom of holding a joint kgotla.
18. In the ensuing nine days we travelled an aggregate of 1,500 miles and were present, either together or separately, at 8 meetings attended by perhaps 4,000 members of the tribe. Before our departure the tribal representatives, though they could not agree to a joint kgotla with Tshekedi present, said they would not offer objection to the presence at such local meetings of any of Tshekedi's supporters who lived in, or happened to be present in, the several localities. In fact, supporters of Tshekedi appeared at only four of these earlier meetings. At Mahalapye some 30 of them appeared before our arrival, but the reaction of the gathering was so antagonistic that they had no choice but to leave under police protection. At Madinare nine of Tshekedi's supporters and at Bobonong one, appeared; in both cases the people refused to proceed with the meeting until after they had departed. At Sefhare (claimed by Tshekedi to be a centre where support for him is strongest) 30 Tshekedi men, some of them from Rametsana, sought to attend the meeting at which 300 persons were present. Mr. Lipson intervened in their behalf and in this instance the Headman allowed them to remain. It is significant of the weight of influence attaching to rank that Tshekedi himself presently claimed that his Sefhare supporters owed this immunity to the seniority enjoyed by their foremost leader.
19. The meetings were most successful in the interest they attracted. At all times the tribesmen were most polite and courteous, making us welcome, but they also made overwhelmingly clear their attitude to Tshekedi. This they did not by vote so much, although in one or two instances votes were taken, but by methods reminiscent of a Quaker meeting, i.e., after many speeches from the tribe the headman expressed the spirit of the meeting. Often it was pointed out to us that the question we were putting had been answered by the tribe more than once or twice before and that they had given clear and definite answers which left no room for doubt.
20. On Friday, 10th August, we all three reassembled at Mahalapye and resumed our efforts to persuade the tribal representatives to agree to the holding of a joint kgotla. In those efforts we were supported by the Administration. On the morning of 11th August the High Commissioner met some 60 of the representatives and in the afternoon we saw the same people. Both meetings were unsuccessful and at the second the tribal representatives went so far as to suggest that if they were pressed further on the point they would be unable to continue their co-operation with us, even limited as it was to district meetings.
21. Time had begun to press, and it was necessary for us to consider the recommendations we could make to the Secretary of State as to the proposed joint kgotla and our further programme. In the event, we advised the Secretary of State, strongly and unanimously, that the effort to secure a joint kgotla should be abandoned. In doing so we further expressed our unanimous and unqualified opinion that the alternative programme of investigation upon which we were engaged would give us all the opportunity we needed to arrive at a true valuation of the views of the people of the Reserve on the one question that was before us. Our reasons for making these recommendations may be summarised as follows:—
(1) The smaller informal district meetings which we had attended and which, as stated above, numbered in the aggregate some 4,000 persons, had been a success in that we had been able to make intimate contact with the rank and file of the tribe, many of whom freely expressed their opinions in open debate.
(2) The freshness of discussion at these meetings, and the variety of speakers, had been such as to rule out the possibility of wholesale previous direction. It is true that the failure to arrange for a joint kgotla meant that Tshekedi Khama had had no opportunity to state his case in person to the people of the Reserve and that, consequently, we had had no opportunity to observe their reactions to such a personal statement. It is not for us to hazard conjecture as to the effect upon the tribe of a statement of his case by so compelling a personality as Tshekedi Khama, but we have no hesitation in recording our conviction that in their present mood the people of the Reserve would not, in fact, give him a hearing.
(3) To force the joint kgotla against the wishes of the tribal representatives would almost certainly be answered with a boycott by their supporters. The ability of the tribe to boycott a meeting had been effectively demonstrated in 1950, and we decided that a kgotla summoned in such circumstances, attended as would be likely only by Tshekedi and his supporters, would in no way advance the primary purpose of our mission. More was likely to be gained from the meeting, already arranged, with Tshekedi and his people on his own ground where there would be no opposition and no difficulty in securing the attendance of his supporters.
(4) Again, we had already received evidence of such strong feeling within the tribe that we could not ignore the possibility that, even if a joint kgotla could be arranged, emotions might gain the upper hand and the kgotla end in disorder.
(5) Finally, although we had faithfully undertaken the task imposed upon us by the Secretary of State of seeking to secure a joint kgotla, it was the case that native law and custom would make a full tribal kgotla essential only if a decision were required from the tribe. Our mission was only to assess the state of feeling within the tribe and our ability to do this in one large formal kgotla might actually be restricted.
22. In making these recommendations we received the full support of the High Commissioner and the Administration. On Tuesday, 14th August, we learnt that the Secretary of State had accepted our recommendations and had decided that the intention to hold a joint kgotla could be abandoned in favour of our alternative programme of investigation.
III.—Alternatives to the Joint Kgotla
23. On Monday, 13th August, we met Tshekedi Khama at Rametsana, the locality within the Bakwena Reserve just south of the Bamangwato border to which he had retired in 1949 and to which Seretse's father had been exiled by his own father many years before. We held three private meetings with Tshekedi and attended a public meeting of fully 200 of his supporters, at which Chief Kgari of the Bakwena was also present. Tshekedi repeated the arguments which have become so familiar in interested circles in London. He expressed the belief that if he were allowed into the Bamangwato Reserve he could ensure a joint kgotla. As we state elsewhere in this report, remembering how the High Commissioner's meeting was boycotted in 1950, we did not share his confidence.
24. On August 15th we were present at yet another district meeting at Palapye. A number of Tshekedi's supporters sought to attend, but their presence was resented by the mass of the people and the headman asked us to arrange for them to leave before the meeting could proceed. Appeals failed to move the people, and after some discussion between ourselves we agreed that since it was their own meeting the headman himself must take responsibility for asking them to go.
25. On Thursday, 16th August, we held our final meeting in the Reserve, at the capital, Serowe. This was a most impressive gathering of between 5,000 and 6,000 people, presided over by Keaboka as leading tribal representative, who had also invited the small European population of Serowe to be present as witnesses. Keaboka did not himself address the meeting except as Chairman to introduce us and state our object. If there were nominated speakers among those taking part there were certainly more who spoke extempore and took their chance among the many who wished to speak. The refusal to agree to a joint kgotla was forcefully explained and on two occasions, by loud and spontaneous acclamation, the meeting left no doubt as to the general feeling on the subject of Tshekedi's return. No recognised followers of Tshekedi were present and none sought to attend.
26. In the afternoon of the same day we met and talked with more than 1,000 women of the tribe, a succession of whom passionately and even threateningly elaborated the theme "we do not want Tshekedi back." (Women, too, were the ringleaders in the disturbance at Mahalapye that made it impossible for Tshekedi's small band of supporters to state their case at our meeting.) This we note as a novel departure in local custom, since it is not the women's habit to engage in political discussion. That they should have done so on this occasion is evidence of the strong emotion they feel on the subject of the present dispute.
27. On 17th August, at Gaberones, we met, in the morning, some of the leading Europeans in the Protectorate, members of the European Advisory Council. In general they confirmed our interpretation of views expressed at the tribal meetings. They were helpful especially about the economic background, an important aid to understanding, but outside the scope of this report.
28. In the afternoon we met chiefs of other tribes in the Protectorate, with their leading advisers, in all some twenty-six members of the Protectorate African Advisory Council. It is of interest that this Council were strongly of opinion that full discussion demanded the presence of both parties to the dispute, expressing regret that the Bamangwato representatives failed to accept the invitation to attend. Tshekedi was present, and the fact that those who spoke did so in his favour is perhaps a tribute to his great personal magnetism, but it also reflected the preoccupied concern of the speakers for the rights and privileges of Chiefs and chiefly families.
29. There was also made available to us for questioning a panel of respected Africans versed in native law and custom. It is evidence of the difficulty of interpreting custom that Tshekedi objected to all three members of this panel (one of whom is an expert constantly used in the Courts) but by this we were not greatly moved since there was now little that we had need to refer to them.
30. We then left the Bechuanaland Protectorate for Swaziland, where, on Monday 21st August, we had the pleasure of meeting Sobhuza, Paramount Chief of the Swazi Nation, and his Council. The Paramount Chief, a very distinguished African, strongly urged that the Bamangwato dispute in all its aspects be submitted to a conference of leading Africans. On a major issue, however, he was sceptical about the very possibility of Tshekedi returning to his country as "a private citizen."
IV.—Conclusion
31. In pursuing our task many matters came to our attention but only upon one, the views of the people of the Reserve on this question of the return of Tshekedi Khama as a private individual, are we called to judge. On this one question we have no hesitation in declaring that the return of Tshekedi Khama in any capacity whatsoever at the present time and in the present circumstances would be contrary to the wishes of the majority of the tribe and bitterly resented by a substantial number. On this issue emotions now run dangerously high throughout the tribe.
32. Only on one condition, that Seretse Khama were present to preside, would the people agree to hear Tshekedi. That possibility is outside our terms of reference.
33. The main reason advanced to us, at our many hearings, for the refusal to hold a joint kgotla in the presence of Tshekedi was this; that Tshekedi, having left the Reserve and declared his allegiance to the Bakwena tribe, had thereby surrendered his right to take part in Bamangwato tribal discussions, and that by departing from native law and custom so far as to permit his return to attend a tribal kgotla, they would open the way to a resumption by him, by the mere force of tradition, of all the authority that previously pertained to him as the senior member of the tribe second only to Seretse. This argument rests upon the claim that by native law and custom Tshekedi's presence in a tribal kgotla would make him again a member of the tribe, and the rest would inevitably follow. We do not regard it as incumbent upon ourselves to pronounce upon this question of native law and custom. It is sufficient to state that it is the view clearly and strongly held by the tribe. To them "private citizenship" is impossible to a man of Royal rank.
34. In fact, the mass of the tribe reject Tshekedi Khama's declaration of his renunciation of all claim to the chieftainship. In their view, whatever the intentions of Tshekedi, once he was again received as a member of the tribe, his claim to seniority within the tribe would be inalienable, even by himself. It is their contention that in making this renunciation, Tshekedi Khama was appealing to a British way of thought, and one that he knew to be foreign to the Bamangwato.
35. It must be recalled that the present division in the tribe arose not from Tshekedi's going but from Seretse Khama's defiance of tribal opinion by marrying as he did in September 1948 without the tribal sanction that custom demanded. The division only became palpable after June 1949 when, in the kgotla meeting called by himself, Tshekedi suffered political defeat. In this connection, we were impressed by the evidence that Tshekedi's action in leaving the reserve was indeed "strictly in accordance with tribal law and custom." He then appeared to accept and act on the tradition that there is no place for an opposition party within the tribe, and at the tribal kgotla, and that a defeated leader can only "retire to his cattle post" or, preferably, banish himself altogether.
36. If western phraseology is at all applicable Tshekedi's Government suffered a parliamentary defeat on a vote of confidence. It appears to the tribe, therefore, that Tshekedi's demand for readmission to the Reserve goes back on his former decision and is an attempt to climb back to power, with his Ministers, with the backing of the Bechuanaland Protectorate Administration and of His Majesty's Government. It has even been suggested that the true analogy is to be found in Charles the First's dealings with his Parliament.
37. At this point the conventions of the tribal aristocracy and hierarchy, and especially their general acceptance by the people, gravely complicate the issue. At every meeting we attended it was obvious how every man knows his own station, from the lowest to the highest, and it is particularly at the highest levels that this matters. Genealogical tables are readily available making clear (what every tribesman knows) the present rank in the hierarchy of the almost innumerable individuals of the Royal family—Seretse is No. 1, Tshekedi No. 2, Rasebolai (Tshekedi's right hand) No. 3, Keaboka No. 4 and so to the nth. During our visit, Rasebolai—No. 3—having been "ordered" out of Serowe by the tribal representatives was eventually bowed out with salutations of "Nkosi" (Chief). At every point we were met by the argument that these Royal rights are an inalienable birth-right.
38. The chief fear is that if Tshekedi returns in the absence of a superior he will and must step as of right into the position of Chief and bring about a counter-revolution—and this in spite of what amounted to his constitutional displacement by the kgotla in 1949. It is, in fact, impossible to conceive of Tshekedi "as a private citizen" so long at least as the Serowe kgotla is the dominant factor in Bamangwato politics. If he is at liberty to attend he automatically becomes its chairman and ruler, and he has himself gone so far as to claim that by custom the decision of the kgotla is the decision of the president alone.
39. In the course of our investigations we were faced with a series of personal grievances, some of them dating from many years past, against Tshekedi. After 23 years of personal rule personal grudges were perhaps to be expected. There can be no doubt of the great administrative ability shown by Tshekedi Khama in the past, nor that he has great ambitions for the Bamangwato tribe. We received an impression, none the less, that if only for want of effective administrative machinery, Tshekedi's personal exercise of power paid little regard to the individual or his rights. It is significant that the spokesmen of the allied tribes in the "back blocks" were solid with those elsewhere in their expressed opposition to the return of Tshekedi. In their eyes even his laudable work for the Bamangwato Secondary School at Moen (?) involved them chiefly in the payment of a heavy cattle levy which left so much less revenue for the establishment or development of schools needed in their own localities. Clearly wishing to continue to enjoy greater freedom to manage their own affairs, the people now fear the return of this powerful personality.
40. We would record also that we have received ample evidence that this hostile feeling extends, in lesser but still large part, to the leading supporters of Tshekedi, the so-called Rametsanes. It is our view that this feeling is one of such strength that the Administration may have to give this minority positive protection. Although the emotional storm makes it hard to judge the number of those who would in different circumstances be prepared to follow Tshekedi, there is no doubt that his active supporters include a high proportion of the ablest and administratively most experienced members of the Bamangwato and that their permanent exclusion from the Reserve would represent an impoverishment of the tribe.
41. Perhaps our overriding impression is this, that the greatest need of the people of the Bamangwato Reserve is a period of peace to go about their everyday affairs freed from the distraction of continuing disturbances resulting from consideration of the affairs of members of the chiefly house.
H. L. BULLOCK. W. M. MACMILLAN.
September 1951. ANNEX C
REPORT BY MR. D. L. LIPSON
01. The purpose of the visit of the three observers to the Bamangwato Reserve was to find out and report on one question only: whether the tribe was in favour of the return of Tshekedi to the Reserve as a private individual or not, he having renounced all claims to the chieftainship.
02. It was originally hoped to obtain this information by the summoning of a special kgotla to be held at the capital, Serowe, which Tshekedi and his supporters would attend. We were to convey to the tribe the invitation from the Secretary of State to hold such a meeting.
03. Our first aim was to get both the opponents and supporters of Tshekedi to agree to the holding of a joint meeting. It was necessary to approach each side separately in order to obtain consent. Soon after our arrival in the Reserve we met on two occasions representatives of the tribe who were opposed to Tshekedi and urged them to accept the Secretary of State's invitation. They answered that before giving their reply they must consult those whom they represented in the various districts from which they had come. Subsequently they declined the invitation. The reason they gave was that it would be contrary to "native law and custom" to hold such a meeting. Tshekedi, they said, had left the Bamangwato and gone to the Bakwena tribe, to whom he now owed allegiance and paid taxes; he could not, therefore, take part in a kgotla of the Bamangwato. They declared that they were at war with the supporters of Tshekedi and could not agree to sit down at a meeting with them.
04. Our approach to the representatives of the supporters of Tshekedi, whom we next met, resulted in an immediate acceptance of the Secretary of State's invitation. They welcomed, and to the end continued to ask for, a joint kgotla.
05. The representatives of the tribe in refusing the Secretary of State's invitation said that they were willing for us to move freely throughout the Reserve and to attend kgotlas in the districts. These would enable us to ascertain the views of the tribe on the question of Tshekedi's return.
06. We decided that it would be unwise at this stage to press our request for a special joint kgotla lest it might lead to the tribal representatives being unwilling to co-operate with us in the holding of the district kgotlas. They had already told us that if a special joint kgotla was summoned by the District Commissioner, who was the legal Native Authority, they would boycott it, as they had done on a previous occasion. We should then be faced with the presence of only Tshekedi and his supporters and that would not serve the purpose of our mission. We hoped, however, that if the district kgotlas were a success and we were able to convince the tribal representatives as a result of better acquaintance with us that we were independent observers, not concerned with taking sides as to whether Tshekedi should return or not, but only anxious to obtain the true view of the tribe as a whole on this matter—that they might later be willing to reconsider their decision against a joint kgotla.
07. We then decided that in order to cover the whole Reserve it would not be possible for the three observers to attend all the district kgotlas, so agreed to go separately on tour and each one of us to take his share of the meetings.
08. Before doing this we held a tribal meeting at Mahalapye at which all three of us were present and spoke and heard the views of those present.
09. At only one of the district kgotlas, that at Seffhare, were supporters of Tshekedi allowed to be present, and there it was in consequence of a special appeal made to the headman. At this meeting the 300 present included 40 supporters of Tshekedi, some of whom spoke and were heard without interruption by the rest.
10. These district kgotlas had this advantage: many of the speakers described themselves as private individuals. In this way we were enabled to obtain the view of the rank and file. At a special kgotla the speeches would have been made by the leaders only.
11. All the same the district kgotlas were only a second best. Nothing could help us so much to form a true opinion of the views of the tribe as a joint kgotla. at which both parties to the dispute were present and were able freely to express their views.
12. On our return from tour we made a further attempt to secure a joint kgotla. An appeal was made to 60 representatives of the tribe, but they persisted in their refusal.
13. We three observers then went to Rametsana to meet Tshekedi and 200 of his supporters who were there with him. We had three meetings with Tshekedi personally and one with his supporters. He and other speakers declared that he renounced all claims to the chieftainship, had committed no crime, all that he asked for was permission to return to the Reserve as a private individual and look after his own personal affairs. (He is the owner of a large number of cattle, the majority of which are in the Reserve, and maintained that their proper care required his personal visits to the cattle posts in the Bamangwato territory.) He asserted that he had been banished without trial not by the tribe but by the British Government.
14. The Rametsana meeting was followed by two others, one at Palapye and the other at Serowe. At the former, attended by about 400, the headman insisted on the exclusion of 5 Tshekedi supporters who had come there. A strong protest was made against their exclusion, but efforts to secure their attendance did not succeed, and the meeting proceeded without them.
15. The exclusion here and at other meetings of supporters of Tshekedi was proof of intimidation. It is true that the number excluded was small but it is reasonable to suppose that there were many other supporters of Tshekedi who were afraid to attempt to attend meetings because they feared violent treatment from their opponents.
16. The Serowe meeting was the largest we had attended. There were over 5,000 present. A final appeal was made there for a joint kgotla. It was pointed out to those present that, large and important as the meeting was, it was not the kgotla which the Secretary of State had hoped would take place because it was representative of only one side. The appeal fell on deaf ears. There can be little doubt that the representatives of the tribe had made up their minds before we entered the Reserve not to accept the Secretary of State's invitation to a joint kgotla. They paid no heed to the arguments used in favour of acceptance. In my opinion one reason for their refusal was their fear of the influence the presence of Tshekedi and his supporters at a joint kgotla might have in winning over some of their supporters to his side. The experience of the meeting at Sefhare showed that it was possible for supporters of Tshekedi to be present at a kgotla and speak without fear of violence, if the leaders gave their consent to their being present. The blame, therefore, for the refusal to hold a joint kgotla rests entirely on the representatives of the tribe. I believe that, if they had agreed to a joint kgotla, their followers would have accepted their decision.
17. In the afternoon we attended a meeting of the women of Serowe at their special request. This was a unique event since the kgotlas were attended only by the male population; women had never before held such a meeting. Between 1,200 and 1,500 women came to the meeting and many of them spoke. They pursued the same anti-Tshekedi line which we had heard from the men speakers at their kgotlas. If anything they were more bitter in their denunciation of Tshekedi and indulged in more threats against his person, if he returned to the Reserve, than we had heard from the men. It is a matter of conjecture how they came to be so violently anti-Tshekedi.
18. In the course of these meetings we addressed between us from 11,000 to 12,000 of the adult population. It was quite clear that the overwhelming majority of them were strongly opposed to Tshekedi's return under existing circumstances. The principal reasons for this appeared to be:
(a) They held Tshekedi chiefly responsible for the banishment of Seretse. This, of course, is not true. They believed that his opposition to Seretse's marriage was due to the desire to obtain the chieftainship for himself.
(b) Tshekedi had been Regent during Seretse's minority for 22 years and had certainly many achievements to his credit, but it was alleged that his rule had become increasingly autocratic, harsh and cruel and that in the carrying out of schemes, excellent in themselves, he had shown no consideration for those who had to do the work they entailed. They insisted that it was not possible for Tshekedi to return to the tribe as a private individual; he was by birth second in rank only to Seretse. If he returned, while Seretse was absent, he would automatically have the right and influence which his royal birth demanded according to native law and custom. "He was a chief by birth," they said, "only God could take his right away." In practice, therefore, it is not possible for Tshekedi to live in the tribe as a private individual in the absence of Seretse.
They further declared that according to native law and custom Tshekedi, before he could return to the tribe, would have to come and ask for forgiveness from the chief of the tribe and obtain his consent to be readmitted. In view of Seretse's banishment the tribe had no chief and, therefore, there was no one to whom Tshekedi could make his appeal.
During the course of our three weeks' stay in the Reserve we also discussed the question of Tshekedi's return to the tribe as a private individual with the lawyers representing both parties to the dispute, with representatives of the traders in the Reserve, with the European and African Advisory Councils, and other leading African chiefs. After leaving the Reserve we visited Swaziland and had a very interesting meeting with the Paramount Chief, Sobhuza, who discussed with us the reactions of the quarrel in the Bamangwato on the African race.
The meetings we had attended gave the impression that there was an overwhelming majority against the return of Tshekedi but, before coming to this conclusion, there are other factors to be taken into consideration. Tshekedi was banished from the Reserve. His opponents, on the other hand, were in control of the tribe and were free to organise opposition to his return. The Secretary of State had undertaken that, if a special joint kgotla took place, the banishment of Tshekedi would be suspended for the three weeks during which the arrangements for it were being made. He would then have been free to visit the Reserve, organise his supporters, deal with any attempts at intimidation of them and encourage them to come forward openly in his support. Further, at the joint kgotla he would have the opportunity of stating his case and attempting to remove what he considered to be unfair accusations against him. Tshekedi is undoubtedly a man of very great ability and, in view of this and of his right of precedence, his presence at such a kgotla might have influenced many to have changed over to his side. It would also have been possible to have put to the test the fears that were expressed in some quarters that his return to the Reserve would lead to serious violence and disorder.
It is not easy to assess what proportion of the tribe would have been won over to favour Tshekedi's return if he had been as free to make out his case for it as his opponents were to make out theirs against it. My own view is that, in spite of all that Tshekedi could have done, there would still have been a substantial majority against his return, so long as Seretse remained in exile. The chief fear of very many of those who were opposed to Tshekedi's return would probably be removed had Seretse also been allowed to return. They would, for the most part, acquiesce in his return, if Seretse were back in the tribe as chief and agreed that Tshekedi might rejoin the Bamangwato. Meanwhile conditions in the tribe are deteriorating owing to the lack of strong leadership.
27th August, 1951.
D. L. LIPSON. CABINET
REPORT ON DISCUSSIONS IN WASHINGTON AND OTTAWA ON BALANCE OF PAYMENTS AND DEFENCE QUESTIONS
Memorandum by the Chancellor of the Exchequer
BALANCE OF PAYMENTS POSITION
I informed my colleagues before I left for Washington in paper C.P. (51) 242 of our worsening balance of payments, and particularly dollar, position and of my intention to discuss these matters with the responsible American Ministers and also with representatives of the Commonwealth in Washington. I was authorised by the Cabinet to inform the United States Administration fully of the worsening of our dollar situation and to discuss possible remedies on the lines proposed in the Cabinet discussion (C.M. (51) 58th Conclusions, Minute 4).
2. Accordingly, on my arrival in Washington I saw personally all the main Ministers concerned and handed to them a copy of the memorandum which is attached at Annex I. I stressed the top secret nature of this memorandum and asked that it should be dealt with within as restricted a circle as possible in each Department. It is in fact the case that there have been no leaks on the American side.
3. I thought it wise to follow up this initiative later by handing to the same Ministers a memorandum setting out ways in which the United States could assist us. The copy of this memorandum is attached at Annex II.
4. The information contained in the first memorandum came as a considerable shock to the American Ministers and at first there was an inclination among their officials to argue that we were taking too pessimistic a view and were not discounting sufficiently the temporary factors. I was able, however, to dispel these doubts and I think it was quite clear that at the end of my visit the Americans were in no doubt about the seriousness of the situation. It is, however, not possible for me to report any definite agreement with the Americans about action which might be taken. The main object of providing these two memoranda to the Americans was to ensure that the Agencies and Ministers principally concerned should know of the position before they started to draw up their proposals for their next Mutual Security legislation. This objective has been achieved and our representatives in Washington will enter into discussions on the details of the second memorandum with the Americans as soon as possible. While I cannot give any forecast of what line the Americans are likely to take I can say that our position is now fully understood and will be considered with sympathy and understanding.
5. I also took the opportunity to explain the position to representatives of the Commonwealth in Washington. Copies of the first memorandum have been sent to Commonwealth Governments through ordinary channels, and I told representatives of the Commonwealth in Washington that we contemplated having a meeting of the Commonwealth countries at the official level about mid-November to consider the action which we should take on a joint basis to deal with the position. I am proposing to go ahead with the arrangements for this meeting of officials, and a telegram will be sent accordingly in the near future.
WAIVER OF INTEREST ON UNITED STATES/CANADIAN LOANS
6. I propose to make an oral report to my colleagues on this matter.
DEFENCE
7. My second objective in Washington was to bring some sense of economic reality into the discussions due to take place in Ottawa on the size of the defence programmes of the North Atlantic Treaty powers. The American intention clearly was to use the Ottawa Conference as an opportunity to press the European members to increase their programmes still further on the ground that in total they fell short of the requirements of the Medium-Term Defence Plan, and still more of the recently formulated requirements of General Eisenhower. It was clear that in the circumstances in which we found ourselves, this was completely unrealistic and the result of the two parts of the North Atlantic Treaty Organisation, the military and the economic, proceeding on parallel lines without proper consultation with each other; what seemed to me to be required was a means of confronting those responsible for the military requirements with those of us who were aware of the economic possibilities and limitations.
8. When the Foreign Secretary reached Washington from San Francisco I discussed the matter with him, urging that it should be added to the agenda for his tripartite conversations with Mr. Acheson and M. Schuman, in order that a common line of policy might be evolved between the Americans, French and ourselves before we went to Ottawa. A tripartite meeting was accordingly arranged at which I set out our position, and M. Mayer explained that the position of France was roughly parallel to our own. He went on to propose the setting up of an ad hoc group of four "wise men" to analyse the problem and make recommendations to the Governments. Mr. Acheson was obviously impressed with the seriousness of the position and it was agreed to give further thought to the French proposal.
9. Soon after we reached Ottawa I had further discussion with Mr. Foster and M. Mayer, as a result of which we secured agreement to the following:
(a) Since the problem was not merely a technical one, those appointed to deal with it should be either members of, or at least in the closest touch with, their Governments;
(b) Ideally the group should consist of representatives of the three major powers only, but some arrangement would have to be made to associate the smaller powers with its work.
(c) The arrangement would be ad hoc and temporary in character, so as not to supersede the regular agencies of the North Atlantic Treaty Organisation, and so that the findings might be arrived at in time for the next submission to Congress. Proposals on these lines were accordingly introduced into the Council, and after some difficulty over the size of the group, the Council adopted the resolution which is reproduced as Annex III. It will be noticed that the resolution describes the new body as a temporary committee of the Council, and that it is required to report its findings to the Council not later than 1st December, 1951. At the same time an understanding was reached that the Chairman would be the American representative (who will almost certainly be Mr. Harriman) and that the British and French representatives would be the Vice-Chairman, who with the Chairman will form the Executive Bureau. I shall wish to discuss with my colleagues the questions that arise regarding the appointment of our representative.
K.G.
Treasury Chambers, S.W.1.,
25th September, 1951. 10. Proposals on these lines were accordingly introduced into the Council, and after some difficulty over the size of the group, the Council adopted the resolution which is reproduced as Annex III. It will be noticed that the resolution describes the new body as a temporary committee of the Council, and that it is required to report its findings to the Council not later than 1st December, 1951. At the same time an understanding was reached that the Chairman would be the American representative (who will almost certainly be Mr. Harriman) and that the British and French representatives would be the Vice-Chairman, who with the Chairman will form the Executive Bureau. I shall wish to discuss with my colleagues the questions that arise regarding the appointment of our representative.
H.G.
Treasury Chambers, S.W.1.,
25TH SEPTEMBER, 1951. ANNEX I
UNITED KINGDOM BALANCE OF PAYMENTS POSITION
A. The Gold and Dollar Accounts
1. At the present moment the gold and dollar balance of payments of the Sterling Area is deteriorating rapidly. In the first quarter of 1951 there was a surplus of £360 million, which fell to £54 million in the second quarter. Thereafter the balance moved into heavy deficit, and this has tended to accelerate. Figures since the beginning of the year are as follows:
Sterling Area Gold and Dollar Balance
| Month | £ million | |-------------|-----------| | January - March (monthly average) | 120 | | April | 59 | | May | 1 | | June | 5 | | July | 137 | | August | 211 |
2. In the first two months of the present quarter, therefore, the deficit has amounted to nearly £350 million. There may be some improvement in September because of the non-recurrence of certain special items. But the quarterly figure as a whole is likely to approximate to a deficit of £500 million. As receipts under E.R.P. are now very small, practically the whole of this deficit will have to be met from the reserves, which will, therefore, fall by about 12% in a single quarter (from £3,667 million to approximately £3,400 million).
3. Though some of the factors responsible for the heavy third quarter deficit will not recur in the fourth, and though there may be some seasonal improvement as well, the fourth quarter is likely to continue to show a considerable deficit, probably of the order of £300 million. This would imply a deficit of some £775 million in the second half of this year and a loss of reserves in six months approaching £3 billion or about 20% of the reserves at the end of June.
4. The main factors responsible for this rapid change in the position are considered in greater detail below. It is clear from the movements which have taken place or are in prospect that we face an altogether different position from that which was envisaged by the United Kingdom in its submission to the Financial and Economic Board of N.A.T.O. in connection with the investigation into the problems of sharing the burdens of the defence programme. It is equally clear that the situation is radically worse than that envisaged in the estimates and calculations of the United States Administration in its own submission to Congress in connection with discussions on the Mutual Security Bill. A comparison of the latest, very tentative, United Kingdom estimates of the Sterling Area's gold and dollar balance of payments in 1951/52, with the earlier estimates made last April in the submission to N.A.T.O., and with the official estimates of the United States Administration are shown in the table below. In addition, this contains a very schematic projection of the gold and dollar accounts to cover the calendar year 1952. Finally, details of the actual outcome in the year 1950 are given, against which all these projections may be compared.
### Sterling Area Gold and Dollar Accounts
**Comparison of Forward Projections and of these with results in 1950**
| | 1950 Actual | Latest U.K. | U.K. N.A.T.O. | U.S. official | Latest U.K. Schematic | |------------------|-------------|-------------|---------------|---------------|-----------------------| | **U.K. Imports** | 1,192 | 2,140 | 2,100 | 2,010 | 2,100 | | **Exports** | 882 | 1,160 | 1,000 | 1,125 | 1,180 | | **Invisibles** | | | | | | | (net) (excluding M.D.A.) | - | 360 | 50 | 157 | 360 | | **Current balance** | -310 | -1,340 | -1,150 | -1,042 | -1,280 | | **U.K. Capital** | 302 | -45 | -30 | | 10 | | **R.S.A. (net)** | 845 | 510 | 1,105 | | 370 | | (including Irish E.R.P.) | | | | | | | **Third countries** | 13 | 156 | - | 207 | 100 | | **Other** | 12 | 169 | 50 | 55 | 100 | | **Sterling Area Balance** | 852 | -1,200 | -125 | 270 | -1,100 | | **M.D.A. and residual E.R.P.** | 750 | 100 | 276 | 106 | 60 | | **Change in reserves** | 1,612 | -1,100 | 151 | 376 | -1,040 |
(($) = plus)
(a) Including 45 Canadian Credit
Comparison between latest estimates and results for 1950.
05. Compared with 1950 the latest estimates for 1951/52 show a deterioration in the sterling area gold and dollar balance of over ($2) billion. After allowing for the fact that dollar assistance amounting to some ($2) billion was received in 1950, against only ($100) million expected in 1951/52, the difference in the movement of the gold and dollar reserves is approximately ($2) billion; that is, an expected loss of ($1.1) billion compared with a gain in 1950 of over ($1.6) billion. This loss is equivalent to some 30% of total reserves at 30th June, 1951. Moreover, a most disturbing feature of the situation is the fact that so far as can be seen the outlook for 1952 as a whole is not significantly better and a loss of reserves during the year of the order of ($1) billion appears to be in prospect.
06. Although the position in recent weeks has been affected by certain temporary and seasonal factors, the major part of the deterioration in 1951/52 compared with 1950 which is illustrated in the table above is attributable to significant underlying influences. Eight major factors can be distinguished as responsible; these are dealt with briefly in the paragraphs which follow.
07. The first factor is the increase in United Kingdom expenditure on imports from the dollar area. Compared with 1950, the import programme for 1951/52 shows a rise of over $900 million. Of this, stockpiling purchases and defence machine tools account for some $300 million. Of the remaining $600 million, the rise in prices of dollar imports (which is expected to amount to 26% compared with average 1950) accounts for 54% and the increase in volume of imports for the remaining 36%. The actual volume of dollar imports programmed (apart from stockpiling and defence tools) is estimated at 18% above 1950 (mainly wheat and flour, tobacco, timber, wood pulp, cotton and non-ferrous metals). This programme is the absolute minimum required to meet essential needs for foodstuffs, and to provide the raw materials on which production and the defence programme itself depend.
08. The second factor is the halt to the rise in the volume of United Kingdom exports to the dollar area. Exports of raw materials and semi-manufactured goods have already had to be restricted because of shortages. Other exports, e.g. vehicles and textiles, have been affected by weakening demand. Though actual receipts from exports are expected to rise by $250-300 million compared with 1950, this is primarily the result of higher prices. Increased earnings from exports will thus meet less than a third of the extra cost of United Kingdom dollar imports.
09. The third factor is the effect of the Persian crisis and the serious worsening of our dollar invisibles account. Replacement from dollar sources of the loss of Persian supplies is estimated to cost over $300 million per annum. Though there will be some saving on expenditure in Persia, the net cost in dollars may well be between $200-300 million a year. Compared with 1950 this is the major change in the dollar invisibles account.
10. The fourth factor is the beginning of debt service on the U.S. and Canadian credits. This will cost some $174 million per annum, beginning at the end of 1951. The same figure has been allowed in 1952. (See Appendix A for details.)
11. The fifth factor is the big reduction in dollar capital inflow, mainly on short term account, from the high level reached in 1950. This inflow was partly speculative in character and necessarily temporary. Nevertheless it was an important factor in inflating the gold and dollar surplus and the reserves in 1950 and its non-recurrence worsens the final result in 1951/52 by some $200-300 million.
12. The sixth factor is the rise in dollar spending by the Rest of the Sterling Area countries, outstripping the increase in their dollar earnings. Compared with 1950, expenditure in the first half of 1951 by Rest of Sterling Area countries increased by about 50%. This is a trend which may be expected to continue. The estimates for 1951/52, in fact, imply an aggregate expenditure on imports from the dollar area (excluding Indian imports financed through the Grain Credit) amounting to approximately $1,200 million compared with $650 million in 1950. The influences behind this increase are similar to those affecting the United Kingdom; that is, higher prices, and increased requirements for stockpiling, expanding production, and in replacement of supplies which cannot be obtained elsewhere. There are as yet no signs that this increase is slowing up, though difficulties in procuring supplies from North America may be growing. Though earnings are expected to be greater in 1951/52 than in 1950 the total dollar surplus of the Rest of the Sterling Area is estimated at nearly $300 million less, primarily as a result of the rise in dollar expenditure. (Further details of the balance of payments of the Rest of Sterling Area with the dollar area are given in Appendix B.)
13. The seventh factor is the sharp deterioration in the United Kingdom position vis-a-vis other O.E.E.C. countries. In 1950 the U.K. net surplus in the Intra-European Payments Agreement and the European Payments Union amounted to £273 million. In the first quarter of this year the surplus was still large—£55 million. Since then there has been a rapid worsening of the position; the monthly figures have been as follows:
| Month | £ million | |-------|-----------| | April | 18 | | May | 10 | | June | 18 | | July | 43 | | August| 67 |
14. The factors responsible for this deterioration have much in common with those which have been influencing the dollar situation. In particular, there has been a rapid increase in United Kingdom imports, under the influence of higher prices and the measures of liberalisation which have been taken. In the second quarter of 1951 imports at about £240 million were over 70% above the quarterly average in 1950. An even greater increase has taken place in expenditure by the Rest of the Sterling Area. It is true that Sterling Area earnings, in particular from sales of the major raw materials produced in the Rest of the Sterling Area, also increased rapidly towards the end of 1950 and remained at a high level until the middle of this year. But the fall in prices in recent months will bite very severely into future earnings, while there is at present no sign that the upward trend in expenditure has been halted. In these circumstances a very substantial deficit in E.P.U. in 1951-52, of a minimum of £250 million, becomes a distinct possibility. Even this figure implies that the present increase in expenditure will tend to slacken, and presupposes no further reduction in Rest of Sterling Area export prices. In unfavourable circumstances the deficit might rise by between £100-200 million more. By the end of this month it is expected that the United Kingdom will have exhausted its credit balance in E.P.U. and will have repaid the £43 million in gold and dollars drawn in 1950-51. Thereafter the deficit will be met for a time by credit advanced by E.P.U. But the prospective deficit is so large that further payments in gold and dollars will almost certainly become necessary later in the year. The estimates, in the table in paragraph 4 above, allow for a notional loss of £50 million in the two halves of 1952, following the loss of £106 million in the present quarter of 1951. Clearly in some circumstances this loss might be substantially exceeded.
15. The eighth factor is the increase in prospective gold and dollar losses to non-dollar countries as a result of the weakening of the United Kingdom's overall balance of payments. In 1950 and early this year a scarcity of sterling resulted in substantial purchases against dollars (e.g. by Brazil, Japan etc.). These were large enough to offset the "normal" gold and dollar losses to countries such as Persia and the Netherlands West Indies in connection with the operations of the oil producing companies. The earlier purchases have now been largely sold back again, and the increasing availability of sterling resulting from the deterioration in our overall balance has greatly enhanced the risk that dollar settlements with various non-sterling area countries will have to be made to meet current balance of payments deficits. In particular, the Sterling Area position vis-a-vis Argentina, Finland and Eastern European countries generally is likely to be extremely difficult and may either involve dollar payment, or a risk to essential supplies, or the need to replace them from dollar sources. In the estimates above a general allowance has been made for the expected dollar losses in connection with these countries, amounting to some $100 million in 1951-52 and in 1952. (Details of these gold and dollar transactions with non-dollar countries are shown in Appendix C.)
Comparison between present estimates for 1951/52 and the earlier United Kingdom estimates submitted to N.A.T.O.
16. Compared with the situation envisaged in April, 1951, when the estimates for N.A.T.O. were compiled, the present calculations show a deterioration in the gold and dollar balance of over $1 billion, and a loss of reserves of $1.1 billion, against a hoped for gain of some $150 million - a difference of about $1 billion in the size of the reserves.
17. Some of the factors responsible for this worsened position have been mentioned above in the comparison between 1951-52 estimates and actual results in 1950, e.g. the loss of Persian oil, and the sharp deterioration in the U.K. position in E.P.U., as well as with a number of other non-sterling area countries. But the most important single factor in the changed outlook is the fall in prices of the major commodity exports from the Rest of the Sterling Area and the reduction in demand for wool, rubber and tin. Compared with prices in the middle of February, on which the estimates for N.A.T.O. were based, current prices have fallen by the following amounts:
- Wool (crossbred) ........... 50%
- Tin ................................ 45%
- Rubber .......................... 30%
- Cocoa ............................ 9%
These four commodities alone account for about 60% of the total earnings from exports of the Rest of the Sterling Area. It is difficult to estimate what the decline in prices so far means in terms of aggregate dollar earnings, but provisional calculations suggest that receipts by the Rest of the Sterling Area will be almost $250 million or nearly 25% less in the second half of 1951 than in the first half. Compared with the estimates in the N.A.T.O. submission, the reduction in 1951-52 is of about $400 million. Included in this figure is some allowance for a decline in expected demand for wool, rubber and tin, particularly for stockpiling purposes, compared with earlier views. 18. Other differences of less importance are (a) in the estimate for U.K. exports, where a rather more optimistic view is now taken of the prospect of dollar earnings (plus $160 million); and (b) in the estimate for N.D.A. receipts, where the original United Kingdom forecast included an allowance of $250 million for the estimated dollar cost of the additional defence programme, while the current estimates include a sum of only $60 million in respect of defence machine tools. The two differences are largely offsetting.
Comparison between the United Kingdom and official United States estimates
19. Most of the conclusions which emerge from the examination of the United Kingdom estimates apply with equal or even greater force to the official United States estimates of the probable position of the sterling area dollar accounts in 1951/52. In particular, the following points should be noted:
(a) The deficit on invisible account does not allow sufficiently for the loss of Persian oil.
(b) The R.S.A. and capital surplus is not dissimilar from the original U.K. estimate for N.A.T.O. and is thus very much over-stated.
(c) A large E.P.U. surplus is forecast, whereas there will have been losses of $106 million in the current quarter alone, and there may be further losses later in the year.
20. General conclusion on the position of the reserves
On the basis of the estimates put forward in this note, the United Kingdom's reserves, which will amount to approximately $3,100 million at the end of 1951, may fall to little over $2,000 million at the end of 1952. This will bring them, in absolute terms, back to little more than the level reached at the end of March, 1950. In terms of purchasing power, however, that is, after allowing for the rise in import prices which the United Kingdom must pay, amounting to some 60% over the past two years, reserves of $2,000 million will be no more than they were at the lowest point reached since the end of the war.
B. The Overall Balance of Payments
1. In 1950 the United Kingdom earned a surplus in its overall balance of payments of £229 million. In the second half of 1950 the surplus was running at the rate of £366 million a year. Only very provisional estimates are available so far for this year; these show that the surplus has given way to a deficit of approximately £200 million in the first six months, equivalent to a rate of £200 million a year and involving a deterioration within six months of £500-600 million per annum.
2. Moreover, the rate at which the deficit is currently running is such that in the second half of 1951 a big increase even over the large first half-year's deficit is virtually inevitable. The rise in import prices has recently been checked, while the continued (though slow) increase in export prices has continued. It is reasonable, therefore, to expect that the current alarming deficit will tend to diminish. But the volume of imports required to support increased production will increase; above all our export trade faces extreme difficulties in expanding beyond current levels as a result of shortages of raw materials and the diversion of capacity to defence production, particularly in the metal-using industries, which have provided half our exports in the recent past.
3. In these circumstances, and as long as import prices remain at approximately present levels a large deficit in the overall balance of payments appears inevitable. The table below shows the probable picture in 1951/52, together with a tentative projection for the year 1952. The essential factors on which these calculations for 1951/52 are based are as follows:
(i) **Imports (excluding stockpiling and defence equipment):**
- Increase over 1950: approx. 10% in volume, costing £300 million at 1951/52 prices
- 35-40% in average values costing £300 million
(ii) **Exports:**
- Increase over 1950: Volume by only 1-2%
- Average value by 25-30%.
(iii) **Invisibles:** Compared with 1950 there is only a small net decline in net earnings on invisible account in spite of necessary allowance for the effect of the loss of Persian oil and the need for replacing it from dollar sources. The assumption is that this replacement can in fact be made. A serious decline in United Kingdom sales to overseas markets would have a catastrophic effect on the balance of payments with a large number of countries, even though there might be some saving on dollar expenditure.
### United Kingdom Balance of Payments
| Year | 1950 | 1951 | 1952 | 1951/52 | 1952 | |------|------|------|------|---------|------| | | Year | 1st half | 2nd half | 1st half | Year | | Imports (incl. stockpiling) | 2,374 | 1,650 | 1,800 | 1,800 | 3,600 | 3,600 | | Exports (f.o.b) | 2,221 | 1,310 | 1,390 | 1,510 | 2,900 | 3,000 | | Invisibles (net) | £382 | £240 | £150 | £200 | £350 | £350 | | Current balance | £229 | -100 | -260 | -90 | -350 | -250 | | Exports and re-exports required to achieve current balance (apart from stockpiling) (approx.) | - | 1,400 | 1,600 | 1,550 | 3,150 | 3,250 | 4. Compared with the United Kingdom submission to N.T.C. in April this year the present estimates show an increase in the expected deficit in 1951/52 of £250 million. (£350 million compared with £100 million.) This difference can be explained as follows:
(i) Bigger expenditure on imports, mainly through higher prices - 150
(ii) Small net invisible earnings, including smaller receipts through A.M.P. which had been reckoned at £90 million and are now reckoned at about £20 million - 170
(iii) Offset by increased export earnings, entirely through higher prices - 70
Total change in estimated deficit - 250
5. The extremely tentative forecasts outlined above suggest that during 1951 and 1952 the United Kingdom's overall balance will be running a deficit of some £300 million a year with no appreciable trend towards improvement over the period. Even this conclusion, however, is dependent on the assumption that import prices show no further rise on present levels, and that the relief from the recent falls will be fully secured. It need hardly be said that a further significant increase resulting from the resumption of world inflationary pressure would have a most serious effect on the United Kingdom balance of payments. A further point which must be emphasised is the extreme uncertainty as to the possibility of achieving even the level of total exports postulated in the present forecasts. The impact of growing defence production has only just begun to make itself significantly felt on the engineering industry; there is an acute scarcity of steel in prospect; and the scope for expansion of exports of consumer goods in place of the raw materials, semi-manufactures, and many classes of metal products whose export is bound to be reduced has definite limits. Every effort must and will be made to secure this expansion, but the difficulties are formidable. In any case an increase in export earnings sufficient to achieve a balance in the United Kingdom's external accounts is, given the present and prospective level of import costs, beyond the range of likely possibility.
6. An overall United Kingdom deficit on the scale forecasts, associated with a formidable and, in the long run, insupportable deficit in the sterling area's gold and dollar accounts (of which it is to a large extent the cause) implies serious weakness in the United Kingdom's external position, both generally and in relation to a large number of countries and regions.
Treasury Chambers, S.W.1,
4TH SEPTEMBER, 1951.
## APPENDIX A
**SERVICE ON THE UNITED STATES AND CANADIAN LINES OF CREDIT ETC.**
| | Interest | Amortisation | Total | |----------------|----------|--------------|-------| | **End-1951** | | | | | Canadian | 22.5 | 13.3 | 35.8 | | (converted at 2.95) | | | | | U.S. Credit | 75.0 | 44.3 | 119.3 | | Lend-Lease Loan| 12.0 | 7.1 | 19.1 | | | 109.5 | 64.7 | 174.2 | | **End-1952** | | | | | Canadian Credit| 22.2 | 13.6 | 35.8 | | U.S. Credit | 74.1 | 45.2 | 119.3 | | Lend-Lease | 11.9 | 7.2 | 19.1 | | | 108.2 | 66.0 | 174.2 |
## APPENDIX B
### REST OF STERLING AREA BALANCE WITH DOLLAR AREA, 1950 TO 1952
| Year | 1st half | 2nd half | 1st half | Year | Year | |------|----------|----------|----------|------|------| | | Provisional | Forecast | Forecast | Forecast | Forecast | | 1950 | 522 | 406 | 455 | 515 | 970 | 1,055 | | 1951 | 724 | 628 | 500 | 550 | 1,050 | 1,050 | | 1952 | -59 | -122 | -32 | -45 | -77 | -100 | | 1951/2 | - | - | - | - | - | - | | 1952 | - | - | - | - | - | - |
### Independent Sterling Area (excluding South Africa and Irish Republic)
- **Imports**: 522, 406, 455, 515, 970, 1,055
- **Exports**: 724, 628, 500, 550, 1,050, 1,050
- **Other (net)**: -59, -122, -32, -45, -77, -100
- **Gold sales to U.K.**: 49, 12, 3, 10, 7, 20
- **Net surplus/deficit**: 192, 112, 10, -10, -85
### Dependent Overseas Territories
- **Imports**: 128, 84, 100, 120, 220, 250
- **Exports**: 564, 412, 300, 300, 600, 580
- **Other (net)**: -2, 30, 14, 15, 29, 35
- **Gold sales to U.K.**: 28, 13, 11, 15, 26, 30
- **Net surplus**: 466, 371, 225, 210, 435, 395
### South Africa and Irish Republic (net)
- **Imports**: 130, 73, 30, 30, 60, 60
### Total Rest of Sterling Area Surplus
- **Imports**: 788, 556, 265, 240, 505, 370
- **Exports**: 1,055, 1,050, 1,050, 1,050, 1,050, 1,050
- **Other (net)**: -100, -100, -100, -100, -100, -100
- **Gold sales to U.K.**: 20, 20, 20, 20, 20, 20
- **Net surplus/deficit**: 85, 85, 85, 85, 85, 85
(1) Excludes expenditure financed from grain credit to India ($200 million).
((\\neq) plus)
### APPENDIX C
**GOLD AND DOLLAR TRANSACTIONS WITH NON-DOLLAR COUNTRIES 1950 to 1952**
| Year | 1st half | 2nd half | 1st half | Year | Year | |------|----------|----------|----------|------|------| | 1950 | Provisional | Forecast | Forecast | Forecast | Forecast | | E.P.U. settlements | $13 | $93 | $106 | $50(1) | $156 | $100 | | Netherlands Antilles and other O.E.E.C. countries | $10 | $14 | $4 | $8 | $12 | $16 | | Persia | $51 | $33 | $18 | $18 | $18 | $18 | | Egypt | $12 | $1 | $57 | $8 | $65 | $16 | | Japan | $8 | $31 | $36 | $36 | $36 | $36 | | Other | $57 | $30 | $13 | $75 | $62 | $100 | | Total | $25 | $134 | $200 | $125 | $325 | $200 |
(1) Assuming a purely notional figure of $50 million a half-year for our gold loss to E.P.U.
\* = plus ANNEX II
01. We have furnished to the interested U.S. agencies a memorandum on the balance of payments of the United Kingdom and the sterling area. The estimates for 1951/52 in the memorandum are provisional and the projection throughout 1952 is hazardous. We are, however, proceeding with further analysis and refinement of the figures. Despite their limitations the forecasts clearly disclose a balance of payments situation which will put in jeopardy our economic stability and therefore our defence programme unless action to check these dangerous movements is speedily taken. In putting the dollar deficit of the sterling area at £1,100 million in 1952, we have in our view fully discounted temporary factors and exceptional payments. The difficulties now confronting us are likely to be prolonged, even as the burden of defence itself. The solution of this problem is a joint interest and calls for action by both the U.S. and the United Kingdom.
02. We shall, of course, do everything within our power and in concert with the other members of the sterling area to reduce the pressure on our balance of payments by increasing exports and reducing imports. The latter expedient is, we recognise, not a satisfactory course. Further, it should be realised that the room for manoeuvre here is not great. Appendix I shows that there is little scope for reductions in the level of consumption and stocks postulated in the balance of payments memorandum.
03. Fundamental damage would be done to our economy, our production and our defence effort, if we tried to close the balance of payments gaps solely by our own efforts, i.e. by restricting imports and increasing exports at the expense of defence and essential investments. Even if the action taken by all sides is both effective and immediate the reserves of the sterling area will nevertheless be considerably reduced before such action can have its impact. Our objective must be first to reduce very substantially the rate of decline and then as soon as possible to stabilise the position. We must aim at measures adequate when in full operation, to close as soon as possible the gap of £1,000 million or so, without lasting damage. We believe that by actions which we and the R.S.A. can take we can fill at best half this gap.
04. (a) We shall be approaching the U.S. Government about filling by end-item aid the equipment deficiencies in our present defence programme. The amount involved is between 1.5 and 2 billion pounds. The provision of this end-item aid will greatly strengthen our ability to play our part in the N.A.T.O. defence but will not of itself help in the solution of the problems set out above. We have, therefore, considered measures which the U.S. Government might take in order to help to fill the gap. There are two measures which are necessary in order to prevent our economic position as set out in our memorandum on the balance of payments, from deteriorating even further. These are set out in paragraphs 4 and 5. The measures set out in the succeeding paragraphs would make a positive contribution to improving the position. We realise, however, that changes in legislation may be required to carry them out. This emphasises the necessity for immediate action in fields not requiring new legislation.
05. **Steel.** In a separate note (Appendix II) we show that without an import of 800,000 tons of steel from U.S.A., the general balance of payments deficit in our memorandum would be increased by at least £165 million.
06. **Imports from the Sterling Area.** In the table on page 3 of our memorandum, we have already assumed large U.S. purchases of wool, tin and rubber at reasonable prices, i.e., wool sales of £258 million, rubber net £280 million, tin £115 million. Insofar as our dollar earnings from these exports to U.S. are smaller because of reduction in volume or price, the dollar picture presented in the memorandum will be worsened. The most important contribution, which the U.S. agencies can make here, would be to maintain a steady buying policy and by long-term contract or otherwise, to provide a reasonable stability of prices, whether in ordinary purchases or in purchases for stockpiling. It should be emphasised that the foregoing would be required merely to prevent the position from being no worse than that painted in our memorandum, and we would wish in discussions to verify that the assumptions on which our figures are based are in fact not over-optimistic. The U.S. could also help by removing restrictions in U.S. consumption of these sterling area commodities. A positive contribution towards closing the dollar gap would be made if the U.S. would increase the volume of its imports of such R.S.A. commodities as are readily available at reasonable prices for stockpiling.
07. **Off-shore Purchases from United Kingdom Production.** This could be the most efficient single method which U.S. might adopt to help us since the amounts involved are potentially very large. Significant assistance could be afforded to our balance of payments if the U.S. were to purchase for dollars some of the products inside the £2 billion production element in our defence programme and would firmly guarantee that these products would be turned over to the United Kingdom. In order that timely relief may be accorded to our balance of payments it would be necessary for some of the orders already placed in the United Kingdom (these amount to about £1,000 million out of the total of £2,000 million) to be taken over under the off-shore purchase procedure mentioned above. We suggest immediate study of the techniques and the amount of relief which can be obtained in this way for our balance of payments and for the preservation of our defence programme. If such off-shore purchases were related to production beyond the £2 billion production element in our current defence programme, this would involve further diversion of industrial capacity to defence. Such diversion would in no way improve our general balance of payments position; in fact it would lead inevitably to the same difficulties with which we were faced immediately after the last war.
08. **Additional end-item assistance from U.S. production.** This could be in relief of our existing defence production. The provision of additional end-item assistance in reduction of the £2 billion production element in our existing defence production programme could release part of our engineering industries to increase the volume of exports which are required if we are to attain the external balance essential to our defence programme.
09. **Off-shore Purchases by U.S. in Europe for the United Kingdom Defence Programme.** We have already placed in Europe orders for finished equipment and machine tools to a value of £40 million for our 4.7 defence programme. Our target expenditure in this sector was £50 million per annum, and subject to satisfactory financial arrangements there would no doubt be additional orders beyond the £40 million mentioned above. Our general and dollar balance of payments could be improved if the U.S. were willing to take over these European orders already placed and others that may with their agreement be placed and turn the goods over to the United Kingdom for its defence programme. If this procedure is accepted in principle, we suggest that examination of amounts and technique should proceed immediately. We would require arrangements to ensure that the goods would be reserved for the United Kingdom defence programme.
10. Cost of Works Services for U.S. Forces in the United Kingdom. The United Kingdom has agreed to pay 50% of the cost of certain specified projects in the United Kingdom for the U.S. Air Force and a rather higher proportion of the cost of the "Oxfordshire" airfields. Execution of these projects is spread over the period 1950/51 to 1953/4. The latest estimate of the total cost of this programme is £45 million of which, under existing arrangements, about one-half would fall upon the United Kingdom. Further projects of this kind estimated to cost a further £40 million are believed to be in contemplation. If the U.S. would pay the whole capital cost of these projects and subsequent maintenance costs we would thereby receive an immediate and continuing alleviation of our dollar problem. Such payments could presumably be made out of existing U.S. defence appropriations and would not now or hereafter create a demand on mutual security funds.
11. Stockpiling. Stockpiling of essential and bulky commodities on an adequate scale must form an integral part of any defence plan. The dollar component of our stockpiling programme in 1951/52 is £175 million and our overall imports for stockpiling in 1951/2 will be about £100 million. This is part of a 3-year stockpiling programme at present planned. Any reduction in it would not only seriously weaken our defence but would embarrass us and our allies in time of war by adding substantially to shipping difficulties. It is therefore suggested that the U.S. might consider financing the food and raw material stockpiling programme of the United Kingdom.
12. Extension of Scope of Mutual Security Aid. The disappearance of the A.M.P. procedure must, given the present balance of payments difficulties, reduce the ability of N.A.T.O. powers to carry out their defence programmes. The restoration of this procedure or greater flexibility in the military assistance programme (e.g. through a more flexible definition of end-item) would provide the possibility of financing the supply of dollar raw materials essential for defence production or other items of direct significance in the defence programme. Particular examples are steel, oil and machine tools.
13. Oil. Our military forces were, during the first half of 1951, consuming oil at an annual rate of £60 million worth. In the light of the Persian situation and the scale of our purchases of dollar oil, we suggest for consideration the possibility of U.S. providing equivalent aid. Relief of this kind could be made coterminous with the dollar loss occasioned by the Persian affair.
14. We would wish as a matter of urgency to pursue discussions of the suggestions in the foregoing paragraphs with the appropriate agencies of the U.S. Government. APPENDIX I
Over 1950 United Kingdom total stocks fell by 15%. In the first half of 1951 raw material stocks, including Government stockpiles, fell by a further 12% and food by 13%. It is conceivable that some of these reductions are counter-balanced by some increase in the stocks in the hands of manufacturers and retailers, but we have not been able to obtain any direct evidence of this. In the light of these movements, the volume of imports provided in the 1951/52 programme appears modest. In 1950 the decline in stocks of imported goods was equivalent to 6% of total imports. An increase of 6% was thus required simply to maintain consumption of imported commodities at the 1950 level. In addition the 1951/52 programme provides for a 5% net increase in commercial stocks of imported commodities. This, however, would do no more than bring them back to the end of 1950 level which was inadequate for efficient operation and distribution. In view of the recent trend of imported stocks, it seems unlikely that the programme of imports would in fact be sufficient to achieve this.
We do not know a great deal about the level of stocks in the R.S.A. but we have no reason to believe that they are unusually high.
The United Kingdom 1951/52 programme provides for consumption of imported food at the 1950 level only and involves a fall in the consumption of meat, eggs and tea. The recent reductions in the ration of sugar and cheese will also bring the consumption of these below the 1950 level. Although consumption did rise sharply in 1950, the level of consumption in the first half of 1951 was actually about 2% less than the average for 1950.
As far as raw materials are concerned, our import programme postulates no further depletion of stocks, but a modest restoration, including provision to deal with increased industrial production of about 4% over 1950.
Our total investment programme is no bigger than in 1950; it includes, however, a much larger defence component and hence implies a substantial reduction in civil investment.
To sum up, we are not programming for increased consumption or increased investment compared with 1950. The increase in commercial stocks is very modest and in the main, our increased production, for which additional imports are required, is being devoted primarily to defence.
APPENDIX II.
STEEL
The balance of payments estimates for 1951/52 and for the calendar year 1952 which have already been circulated, assume that the United Kingdom will at least be able to maintain through 1952 a volume of exports of engineering products in the widest sense (i.e., including broadly all products of the metal-using industries) equal to that in 1950. This will not be possible in 1952 unless total engineering output in that year is about 10% above that in 1950 by volume. This volume of engineering output in the wide sense used above cannot be achieved without steel supplies of 800,000 tons from the United States in addition to anticipated home production and other imports. In 1950 the United Kingdom gross output of metal goods was valued at £2,350 million. Of this defence took £165 million and exports £900 million, leaving £1,235 million for home civil use. In 1952 defence will require £500 million (at 1950 prices), i.e. £335 million more than in 1950. Assuming that the volume of exports is at the same figure as in 1950 and that total output is increased by £235 million home civil use will have to be reduced by £100 million. It should be emphasised that the maintenance of exports at this level will not ensure equilibrium in our balance of payments but will only suffice to hold the deficit at the figure indicated in the estimates already circulated. If the gross output of metal goods cannot be increased in 1952, the balance of payments position will be so much the worse.
The 1952 requirements of steel for purposes other than direct export are estimated at 11.3 million tons against which we should have, if the proposed imports from the U.S. are not secured, supplies of only 10.5 million tons. We must provide as a matter of priority, for increased requirements of certain basic industries (coal, electricity and transport), whose expansion is vital to industrial production as a whole, e.g. the coal industry will need 70,000 tons more in 1952 than in 1950. After allowing for these needs, it is estimated that the amounts available for the metal-using industries on the basis of a total supply of only 10.5 million tons will be so reduced that their output will fall by at least 2% instead of increasing by 10% as projected; and the amount of dislocation might be much greater.
If the output of metal-using industry were 2% less than in 1950, supplies of metal goods for export and home civil use, i.e., after deducting defence needs as estimated in paragraph 2, would be, not £100 million, as forecast there, but really £400 million less than in 1950. It would not be possible to deduct this wholly from home consumption, which of course includes a large proportion for industrial investment of all kinds. This has been under continuous restriction since the war through direct controls and the influence of taxation and these controls have now been restored to their full rigour. It would be dangerous to reduce the investment programme much below the level now planned. Exports would therefore have to take some part of the cuts and even if the fall in exports were limited to a third of the total short-fall, the cost to the overall balance of payments would be £150 million at 1950 prices, or £160 million at 1952 forecast prices. The figure might well be higher.
Thus if our requested imports of 800,000 tons of steel from the U.S. are not obtained, the United Kingdom overall balance of payments in 1952 will worsen by at least £160 million compared with the estimates already circulated. A large part of this would be reflected in our dollar deficit which would similarly also be substantially increased. There would be danger of grave dislocation of the defence programme.
It should be noted that the cost of the suggested imports of steel (estimated at £85,000,000) was by oversight omitted from the balance of payments calculations as circulated. ANNEX III
RESOLUTION FOR CO-ORDINATED ANALYSIS OF N.A.T.O. DEFENCE PLANS
(Approved by the Council at the meeting held on 19th September, 1951, at 5.15 p.m.)
THE NORTH ATLANTIC COUNCIL,
CONVINCED:
(1) That the creation of adequate strength, based on a sound economic foundation, to deter aggression and provide for the defence of the North Atlantic area requires the co-operative marshalling and most effective use of the resources of the N.A.T. countries:
(2) That there is required as an immediate next step an analysis of the issues involved in reconciling on the one hand the requirements of external security, in particular of fulfilling a militarily acceptable N.A.T.O. plan for the defence of Western Europe with, on the other hand, the realistic politico-economic capabilities of member countries,
(3) That such an analysis must not interfere with urgently required further steps to fulfil present national commitments for force contributions;
AGREES:
(1) That a temporary Committee of the Council be formed to carry out the analysis aforesaid and to submit to the Council its findings, including possible courses of action.
(2) That the Committee shall consist of individuals appointed by each of the member Governments who are either Ministers of, or closely related to the Government of their respective countries and who are particularly qualified for this special task. The Committee shall elect from among its members a Chairman and one or two Vice-Chairmen. An Executive Bureau will be formed; it will be composed of the Chairman, the Vice-Chairmen, and any other members whom the Committee may choose to appoint, if necessary, according to circumstances, with a view to expediting the work of the Commission.
(3) That the Committee shall be entitled to call for information, advice and assistance from all member Governments.
(4) That all military and civilian N.A.T.O. agencies are hereby directed to give the Committee such assistance as it shall require. Arrangements to this end may be worked out in consultation with the Council Deputies and the N.A.T.O. "ad hoc" Joint Working Group, and may include, for example, a statement by the responsible military agency, for planning purposes, of time-phased country-allocated force and infrastructure requirements for the defence of Western Europe; an examination of the organisation and equipment of basic national military units with regard to their contemplated roles in the defence of Western Europe, their training and operating requirements (including infrastructure) and the making of recommendations on economy measures to obtain effective military force requirements at minimum cost; a review of the production capabilities existing in the various countries so as to enable the supply of standardized or non-standardized military items for the equipment of necessary forces as expeditiously as possible and at minimum cost; the costing of defence requirements; and the analysis of production, financial and economic possibilities and implications.
(5) That the Committee shall make a progress report to the next meeting of the North Atlantic Council and should complete its analysis and report its findings to the Council not later than 1st December, 1951.
Parliament Buildings, Ottawa. CABINET
THE KING'S SPEECH ON THE PROROGATION OF PARLIAMENT
MEMORANDUM BY THE HOME SECRETARY
I circulate herewith, for consideration by the Cabinet, a draft of The King's Speech on the Prorogation of Parliament, which has been prepared following a meeting of the Committee on The King's Speeches appointed by the Prime Minister.
2. The Speech refers to about one-third of the legislation passed during the 1950-51 Session. The draft as it now stands contains 1,769 words. The number of words in the corresponding Prorogation Speech last year was 1,293. The number in the Prorogation Speech delivered at the close of the 1948-49 Session was 1,614.
J. C. E.
Home Office, S.W. 1, 25th September, 1951. ANNEX
DRAFT OF THE KING'S SPEECH ON THE PROROGATION OF PARLIAMENT, 1950-51 SESSION
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS:
My Government, in association with the other Governments signatory to the North Atlantic Treaty, having accepted the necessity for making greatly increased provision for defence, the consequent strengthening of My Forces is already becoming apparent. I pray that, with God's help, the defence programme will succeed in its purpose of averting war and laying the foundations of a lasting peace throughout the world.
My Government have watched with sympathy and interest the progress made in building up, within the wider framework of the North Atlantic partnership, a European community in which Germany will play her part. My Government desire to establish the closest possible association with this community at all stages in its development.
I welcome the appointment of General of the Army Eisenhower as Supreme Allied Commander, Europe. Units of My Forces have been placed under his command.
In order to increase the readiness of our defences, reservists of My Forces have been recalled for periods of training of between fifteen days and three months, and for periods of service amounting in some cases to eighteen months.
My Ministers have continued to give the fullest support to the United Nations in the maintenance of international peace and security.
It is My earnest hope that the efforts which are being made to restore peace in Korea will be successful. Under the United Nations My Forces have continued to take a prominent part in the arduous campaign in that country. The land forces from the various Commonwealth countries have been grouped together to form the First (Commonwealth) Division. The heroic action of the First Battalion, the Gloucester Regiment, maintained the highest traditions of My fighting services and has been justly acclaimed throughout the world.
My Government deeply regret that, although they made earnest efforts to find a basis for discussion, success did not attend the recent negotiations for a meeting of the Foreign Ministers of the Soviet Union, France, the United States and the United Kingdom.
My Ministers have tried to achieve by negotiation a solution of the unfortunate dispute which has arisen in connection with the oil industry in Iran, but these efforts, despite the help rendered by the special representative of the President of the United States, have so far been unsuccessful.
Together with the United States Government, My Government jointly sponsored the Treaty of Peace with Japan which was signed at San Francisco, on the 8th September, by forty-eight nations. The Treaty was the result of a prolonged series of international consultations in which My Government in the United Kingdom and My Governments in other Commonwealth countries had played a leading part.
In Malaya progress has been made in associating all communities with the administration of Government and in furthering their welfare and prosperity. With the assistance of the peoples of Malaya and the civil administration, My troops have, with increasing success, continued their efforts to restore law and order and to bring communist banditry to an end.
The Prime Ministers, or their representatives, from all the self-governing countries of the Commonwealth met in London in January last to review the international situation and to consider what further positive action Commonwealth Governments could take to secure and preserve world peace. Since then, Ministers from the United Kingdom, Australia, New Zealand, South Africa and Southern Rhodesia met in London to consider defence problems in regions of common concern, including the Middle East, and South African Ministers met with representatives of other interested Governments in Nairobi to consider defence facilities in Africa.
41256 The increase in production, which has been among the outstanding achievements of this country since the war, has continued in the face of many difficulties. For this success great credit is due to workpeople and management throughout the whole range of industry, agriculture and commerce. Despite the obstacles caused by shortages of materials and the high prices of many imports, full employment has been maintained, our exports have continued at a high level and the rearmament programme has been further advanced.
During the past session My Ministers were able to announce that, in agreement with the United States Government, it had been decided to suspend further allotments of Marshall Aid for which we owe a debt of gratitude to the people of the United States.
In order to restrain the rise in living costs provoked by high import prices, measures have been taken, by the operation of price control and otherwise, to limit the rise in the prices of goods and services made inevitable by advances in basic commodity prices, wages and other costs.
I regret that the balance of payments, which was remarkably favourable last year, has, largely because of higher import prices, become less favourable in recent months.
It gave me great pleasure to open in May last the Festival of Britain, in which the whole nation has displayed its talents and traditions in the arts and sciences. Despite the clouds which hang over the world, the celebrations throughout the land have been given a powerful stimulus to the arts of peace and have provided opportunity for well-earned recreation of spirit.
I am pleased that so many visitors from overseas have attended the Festival, which has thus contributed to international friendship and understanding.
I warmly welcomed the State visits of Her Majesty The Queen of the Netherlands and His Royal Highness Prince Bernhardt of the Netherlands, Their Majesties, The King and Queen of Denmark and His Majesty, The King of Norway.
My Ministers continue to attach importance to international co-operation and mutual aid in economic and social matters through the United Nations and other bodies. They were glad to welcome delegates from Commonwealth and foreign countries to the tariff negotiations which were held last winter in Torquay, and to participate with other Commonwealth Governments in the plans for the economic development of South and South-East Asia. My Government continue to collaborate fully in the work of the Organisation for European Economic Co-operation.
My Ministers were glad to be able to exchange views at a meeting in London with Ministers in other Commonwealth Governments concerned with the production of raw materials and the supply of manufactured goods, and in this connection to have the assistance of representatives from a number of Colonial territories.
My deep sympathy went out to My people in Jamaica when many parts of the island were devastated by a hurricane on the 17th August. My Ministers in the United Kingdom announced an immediate grant for relief.
I am glad that the health of My people has been well maintained. Great praise is due to all engaged in the Health Services who fought with considerable success an epidemic of influenza during the winter. I also rejoice that the death rate from tuberculosis has sharply declined.
MEMBERS OF THE HOUSE OF COMMONS:
I thank you for the provisions which you have made for the public services.
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS:
Thanks to the determination of farmers and workers throughout a trying season, the programme for the expansion of the production of food at home has been carried on with unabated vigour.
Legislation has been passed to establish a White Fish Authority with powers to reorganise, develop and regulate the White Fish Industry; and a new scheme has been approved conferring wider powers on the Herring Industry Board. An Act has been passed to extend the help given to farmers rearing livestock in upland areas.
My assent has also been given to a measure providing for the restoration to agriculture and other useful purposes of land broken up by the opencast working of ironstone.
New provisions have been enacted for maintaining or restoring the purity of the rivers and other inland or coastal waters. An Act has also been passed to increase the contributions which may be made from the Exchequer towards the cost of schemes for rural water supply and sewerage.
My Government were gratified by the response which they received to their appeal for extra output from the coal mines. Higher levels of industrial production have, however, greatly increased the demand for fuel and power; and My Ministers have taken, and will continue to take, all practicable steps to encourage the recruiting of more miners, to increase the supply of fuel, electricity and other forms of power and to ensure their more efficient use.
Both sides of industry have recognised the need to remove obstacles to increased production and, with the full agreement of employers and workpeople, provision has been made to postpone the restoration of pre-war trade practices in industry.
The war-time measures for the prevention and settlement of trade disputes have been withdrawn and replaced by provisions more appropriate to peace-time conditions.
Legislation which will be of great benefit to a large number of My People has been passed to augment retirement pensions and the provision for widowed mothers and for children under the National Insurance Acts. The National Assistance allowances paid to those in need have been increased and improvements made in certain supplementary allowances paid to war pensioners.
Increases have been granted in the retired pay and pensions of My Regular Forces.
An Act has been passed to safeguard the civil interests of My Reserve and Auxiliary Forces.
Provision has been made for the setting up of a Courts-Martial Appeal Court to hear appeals against convictions by courts-martial.
My Ministers have continued to develop the organisation of the Civil Defence Services and have been in consultation with representatives of industry and commerce about civil defence in industrial and commercial undertakings and with the associations of local authorities about the organisation of the fire services on a national basis in the event of war.
I gave My assent to legislation to make temporary provision for the protection of the occupiers of certain classes of leasehold property in Great Britain.
An Act was passed which extends the powers and duties of the Forestry Commissioners to establish and maintain adequate reserves of growing trees.
A Commission is being appointed to stimulate the more rapid expansion of cattle breeding and rearing in the Highlands of Scotland. An enquiry has been instituted into crofting conditions in the Highlands and Islands of Scotland.
A measure has been passed to provide more effective means for dealing with the poaching of salmon and trout in Scotland.
Further sums were made available for the development of the Colonial territories and the welfare of their peoples.
Progress has been made in the consolidation of the Statute Law.
I pray that the blessing of Almighty God may attend you. AGRICULTURAL WAGES AND PRICES
Memorandum by the Minister of Agriculture and Fisheries
The National Farmers' Union of England and Wales have announced in the Press and have given me advance notice of their intention to ask for a Special Price Review to meet the extra costs which will be incurred if the proposals of the English Agricultural Wages Board for an increase in the minimum rate of 8/- per week for men and 6/- per week for women with an additional five days annual holiday with pay are confirmed by the Board on 10th October.
2. They had previously (on 31st July) addressed formal representations to me about the heavy and continued rises in other costs since the last Annual Review in February which they claim will amount to £20 millions in a full year, of which £9½ millions will be due to an excess of increased costs of fertilisers over the sum anticipated and allowed for at the last Annual Review. In that communication they suggested that a course which would avoid further increases in the prices of agricultural products would be for the Government to reconsider their decision on the removal of the subsidy on fertilisers (which was discontinued after 1st July last).
3. The Scottish Agricultural Wages Board is meeting today (24th September) to consider a claim for corresponding increases in the minimum agricultural wage and additional holidays with pay. If - as is probable - similar awards are made in both Scotland and Northern Ireland the increased costs in the United Kingdom will be, on an annual basis, of the order of £20 millions.
4. In view of the terms of Section 2 of the Agriculture Act, 1947, and the agreed procedure, it would be difficult to contend that the prospective increase in labour costs and the unforeseen and substantial rise in prices of fertilisers were not sufficiently "sudden and substantial" to justify a Special Review. It would however be possible to reject as inadmissible for the purpose of a Special Review the aggregation of a number of lesser items of cost increases such as transport charges, petrol (owing to the Budget) amounting to £10½ millions.
5. The situation will obviously require very careful handling in view of the political position. Continued uncertainty about the result of the Union's application for a Special Price Review may result in a lower standard of cultivation this autumn (particularly as regards the use of fertilisers) with a consequent falling off in crop production in 1952. If therefore we take no action or reject the Union's application we shall be open to the charge of indifference to the future food supply, and the situation could clearly be exploited, particularly in the rural areas.
6. It might be possible and might indeed be desirable to negotiate a compromise with the Farmers' Unions under which in return for their waiving their claim for a Special Review with its consequent automatic effect on prices of agricultural products, the Government would reintroduce a subsidy on fertilisers which would take into account not only the current increased costs of fertilisers over and above the sum allowed at the last Annual Review (£9 4 million in a full year) but also the increased costs of production arising from higher wages if the provisional award is confirmed (about £20 million in a full year). An announcement of such a proposal during the next few weeks would, however, lay us open to the charge of offering a pre-election bribe to the farming community.
7. If the Agricultural Wages Board confirms its provisional award on the 10th October it might be possible to avoid serious trouble by an announcement that the Government is ready in principle to concede that a prima facie case for a Special Review exists. Discussions might then begin in the following week on the understanding that any decisions would have to be left to whatever Government is in office after the General Election.
8. The advantage of this course would be that we should be acting in accord with our existing undertakings to the agricultural industry while leaving any decision until the Election is over. On the whole I would recommend my colleagues to adopt this plan.
T.W.
Ministry of Agriculture and Fisheries, S.W.1.
24TH SEPTEMBER, 1951. SECRET C.P. (51) 254 COPY NO.\_\_\_\_\_ 25TH SEPTEMBER, 1951
CABINET
LOCOMOTIVE CONTRACT FOR PERSIA
Memorandum by the President of the Board of Trade
At the Cabinet's meeting on 4th September (C.M. (51) 58th Conclusions, Minute 3) the Secretary for Overseas Trade was asked to submit a report on the locomotive contract at present being executed by the Vulcan Foundry Co. for the Persian State Railways, with particular reference to the question whether any alternative markets could be found for the locomotives if, in the event, they were not sent to Persia.
2. The report which follows has been agreed between the Board of Trade and the Ministry of Supply and follows informal consultation with the Chairman of the Vulcan Foundry Co.
3. The Vulcan Foundry Co. is the second largest of eleven firms manufacturing steam locomotives in the United Kingdom. Its production is of very considerable importance, particularly in the export field. (The value of locomotive exports amounted to over £8 millions in 1950).
4. There are in fact two contracts with the Persian State Railways - one for 24 and one for 40 locomotives; the total value is approximately £2,130,000. The orders were secured in the face of severe competition, and followed direct intervention by the British Embassy in Tehran. The Persian State Railways have opened irrevocable credits in respect of both contracts which have been covered by the Export Credits Guarantee Department to the extent of 90 per cent of any loss (including loss arising from a refusal by the United Kingdom to issue export licences) which the exporters might sustain.
5. Approximately 10 per cent of the work on the contracts has already been completed, 20 per cent of the materials for the assembly, etc., of the locomotives has been received, and the remainder is on order and will be coming forward in the course of the next two or three months. First deliveries are due to start in February, 1952, and the whole order is expected to be complete in December, 1952.
6. If work on the contract is stopped, there will be the following consequences:
(a) There will be a very serious gap in production at the Company's works. Owing to the time required to make production plans, produce components and order the necessary materials, it would be ten to twelve months before the Company would be in a position to begin work on an appreciable scale on any other orders. The capacity freed by any stopping of the Persian Contracts could not be used in the meantime by the Company for other purposes and most of the material fabricated for the contract would have to be scrapped. The Company are most apprehensive - and with good reason - that if there were such a gap in their production programme they would lose to other heavy industries a substantial part of their labour force of about 2,700 skilled workers. It would be very difficult indeed to rebuild such a force. It follows that there would be a real risk of a prolonged break in the continuity of the Company's production capacity, which is regarded by the Ministry of Supply as of vital national importance for exports in peace and for the continued production of locomotives in war.
7. The locomotives are designed to operate under conditions existing in Persia and would require modifications to make them suitable for other railway systems. They are standard gauge, but the loading gauge would render them unsuitable for operation on British railways. Nearly all Colonial railways are non-standard gauge. The Company are, however, very hopeful that if the contract with Persia were frustrated it would be possible to sell the locomotives to Turkey or Yugoslavia, since they would be suitable for the conditions in those countries (subject to certain modifications, such as conversion to coal burning) while there would be the added attraction that (subject to the time taken to carry out the modifications) very early delivery could be offered. In this connection it is significant that the Government of Yugoslavia is thought to be about to invite tenders for the delivery of sixty locomotives and, if this proves to be the case, Vulcan's will themselves probably be submitting a tender.
8. In the light of the foregoing considerations and in view of the relatively favourable possibilities of alternative markets in Turkey or Yugoslavia, I have no hesitation in recommending - with the full concurrence of the Ministry of Supply - that the right course will be to authorise the Company to continue with the execution of the contract, notwithstanding the uncertainty of the situation in Persia. If between now and the end of the year a Persian Government came into power with which satisfactory relations could be established, we should presumably be glad to be able to let them have the locomotives in accordance with the contract terms; if there were not such a Government, then we should presumably have to consider frustrating the contract in which event, as I have indicated, there would be good hope that the locomotives might be sold to Turkey or Yugoslavia.
9. As our action in respect of other supplies has not unnaturally led to a certain amount of speculation among the workers at the Vulcan Foundry Co. as to the future of these contracts, it would be most desirable that a decision should be given as soon as possible and that the Company should be authorised to make it clear that His Majesty's Government had been consulted and had agreed that work on these contracts should proceed.
H.S.
Board of Trade, S.W.1.
25TH SEPTEMBER, 1951. CABINET
MANPOWER FOR THE MINES
MEMORANDUM BY THE MINISTER OF FUEL AND POWER
I have, at various times in recent months, pressed on my colleagues the urgent necessity of importing large coal for the house coal market.
2. After considerable discussion, it was agreed that we could buy Indian coal for gas works, thereby, perhaps, releasing some extra large coal for the housewife (this, unfortunately, is not certain as gas works stocks are still unsatisfactory) and that we might buy Polish coal, if political difficulties with the Poles could be eliminated.
3. I also proposed the purchase of a small quantity of dollar coal (perhaps a quarter of a million tons for delivery after Christmas).
4. Some Indian coal has been purchased but it is low grade, and it is doubtful whether the gas works can take more than 250,000 tons at the most.
If we could buy three-quarters of a million tons of Polish coal, and could get delivery fairly soon, the prospects for the house coal market would be greatly improved. Unfortunately, we seem no nearer to reaching a solution of political difficulties with the Poles than we were eight weeks ago.
5. The proposal to import dollar coal has been rejected.
6. This makes it essential for me to remind my colleagues that while householders with stocking space have bought a good deal more coal this summer, the merchants' stocks are not yet a million tons as against the two and a half million which we meant to have at the end of October; and that, in all probability, they will fall at least a million, if not a million and a quarter tons, below the safety figure.
7. I have taken every practicable step to restore the situation by increasing the manufacture of briquettes, diverting small coal from industry to the house coal market to the maximum amount which the merchants can take, &c.
8. But apart from dollar coal, there is, in my view, only one hope of averting a very serious crisis in the winter over household coal. That is to increase the manpower in the mines. By this I mean that the number of men in the mines should be increased by the end of the year by, if possible, 10,000. We achieved this result last winter and I believe we should be able to do it again.
9. I regard the following measures to this end as essential:
(a) Stopping wastage from the pits
Sir Hubert Houldsworth is already working on this with great energy and hopes for results. He is prepared to co-operate with the Ministry of Labour in the highest possible degree.
But it must be remembered that every industry has some wastage; that wastage from the coal industry is, in fact, much below the average wastage of other industries; that with the present high wages obtainable for light work in rearmament industries, considerable wastage may be quite inevitable; and that we must make this good by increased recruitment of people who are likely to stay in the industry. (b) Return of ex-miners from the Forces
One class of recruits who will stay in the mines are ex-miners who have volunteered on long-term engagements as regulars in the Armed Forces. Under the scheme approved in February last 2,400 have, so far, been released, and the number will, no doubt, rise to 3,000. This is the equivalent of 1 million tons of extra production per annum.
I estimate that there may be about 3,000 more miners who would come back to the mines if we now applied the scheme adopted in 1947. As the long-term situation of coal is certainly more serious than it was then, I urge that this should be done. Details are set out in Annex A (in particular, in paragraphs 7 et seq.)
(c) The Home Recruiting Campaign
The campaign decided on in July should be got into full swing and should be conducted with great vigour. The Ministry of Labour lent great assistance in the early part of the year. I believe the same success could be obtained now.
(d) Italians
The Minister of Labour has put forward new proposals for the reorganisation and acceleration of the recruitment of Italians. The Coal Board are prepared to co-operate in the fullest possible degree. I believe that the resistance of the rank and file of the National Union of Mineworkers (N.U.M.) can be overcome. We should aim at a great acceleration in the number of arrivals.
The prospects of success with N.U.M. Lodges will be much improved if the 1947 scheme for release of ex-miners from the Forces and the home recruiting campaign are both carried on with vigour.
10. Even if all this action succeeds, it may, in my view, still be necessary to import some dollar coal after Christmas. I state the case in Annex B.
P. J. N.-B.
Ministry of Fuel and Power, S.W. 1, 25th September, 1951.
ANNEX A
MANPOWER IN THE MINES
1. Between February 1949 and November 1950 manpower in the mines fell from 728,000 to 686,000. During November, December 1950 and January 1951 the Cabinet made a number of decisions which reversed this trend; between November 1950 and 30th April, 1951, manpower rose to 703,400. In May and June the figure at first remained stationary, and then fell slightly. In July and August it has fallen more sharply; and in the last 6 weeks it has fallen by 3,700 men. If this trend continues we should by the end of the year have no more miners than we had in November 1950.
2. The immediate prospect for coal supply is, in my view, less alarming than it was in 1947, except in regard to house coal, of which merchants' stocks are lower than they have ever been before. But the longer-term prospect is clearly worse; the difficulty of meeting the increasing demand over the next 2 or 3 years will be much more serious than the difficulty faced in 1947.
3. In due course the output of coal will be adequately increased by the mechanisation and reorganisation of the mines. But this process, while it can and will be accelerated, must take time; in the interval, the increase of output can only be obtained by increasing the number of miners. From the New Year we cannot expect a great gain over last year from extra Saturday working, as the miners began their increased effort in early January. The Cabinet must, therefore, be ready to take measures, however distasteful, which will bring more men to the mines.
4. Undoubtedly the large-scale introduction of Italians is one of the best hopes. But there has so far been vigorous resistance to the acceptance of Italians by the Lodges of the National Union of Mineworkers; and one of the arguments most freely used is that foreigners should not be introduced while there are trained men in the Armed Forces who want to come back to the pits. In two world wars we have brought home large numbers of men from the front line to dig coal. In 1947 we took virtually every miner out of the Forces. In February of this year the Cabinet accepted the principle that some of the men who had subsequently volunteered on regular engagements should be released. The restricted scheme then agreed to has brought in (to 22nd September) applications from 3,421 men, of whom 2,438 have so far been released. The scheme was limited to those who first enlisted on a normal regular engagement after 31st December, 1948. Men of the rank of sergeant or above, and men serving in the Japan or Korean war areas, were excluded.
5. The necessary instructions went out at the end of February and the numbers of men released were approximately:
- 300 by the end of April.
- 900 by the end of May.
- 1,600 by the end of June.
- 1,900 by the end of July.
Under the original scheme, the last date for application for release was 30th June, and the applications received for release naturally fell off in July, the releases in that month representing applications made earlier. The scheme was then extended (C.M. (51) 50) until 30th September, and since the notification of this extension was sent out in July, applications have been coming in in greater numbers; in August there were a further 360 releases, and so far in September 178.
6. It is not expected, however, that many more than about 3,000 men will be released, even under the extended scheme, which is due to terminate at the end of September, and thousands of ex-miners may remain in the forces either because the present scheme excluded them, or because they have not been sufficiently strongly urged to return to the industry.
7. I now propose that as in 1947 release should be offered to all other ranks still serving in the forces, in all countries who have previously worked for six months at a coal mine, whether below ground or, if they are willing in future to work below ground, on the surface.
8. I repeat that the manpower position in the pits is even graver than it was in the early part of 1947, when, at the meeting of the Fuel Committee on 7th March, the Prime Minister said that it was clearly desirable that ex-miners in the Forces should return to the mines if they wished to do so, irrespective of military commitments.
9. The proposed scheme would include the following categories:
(a) Regular soldiers, sailors and airmen (i) Serving their normal period of Colour Service; (ii) Serving on active service as Reservists.
(b) National Service Men (i) Serving the normal two years' period; (ii) Serving for an extended period.
10. The additional men brought within the release scheme would be:
(a) Sergeants and Warrant Officers everywhere. (b) Men serving in Korea and Japan. (c) Men with more than two years' service in the Forces. (d) Men with surface experience only. 11. In order to ensure that the proposed scheme shall fulfil its purpose, every ex-miner should have the scheme explained to him, and each man should be pressed to take advantage of it. The importance of this was stressed in a letter from the Ministry of Fuel and Power to the Prime Minister's Private Secretary on 12th March, 1947, as follows:
"The tone of the offer is most important and I should like to suggest that the Prime Minister should ask that the offer be presented, not as anything in the nature of a concession, but rather as an indication of the way in which the men concerned can best serve the national interest."
In a minute dated 14th March, 1947, addressed to the Minister of Defence, the Prime Minister said:
"The response to these offers will no doubt depend to a large extent on the tone in which they are made. It should be made clear to the men that in present circumstances it is definitely in the national interest that as many as possible should return to the mines, and arrangements should be made to ensure that all who respond are released immediately."
Conclusion
12.—(a) I would urge that the existing scheme, widened in scope as I have suggested in paragraph 7 above, should be extended after 30th September for a further period of 6 months, and that instructions on the lines of the Prime Minister's minute quoted above should be issued to all concerned in the Services. I attach equal importance to both points in the Prime Minister's minute, viz.:
(i) the clear explanation to the men that it is in the national interest that as many as possible should return to the mines; (ii) the immediate release of men who agree to return.
(b) I repeat that this decision would greatly help to secure the acceptance by the Miners' Lodges of increased numbers of Italians.
ANNEX B
HOUSE COAL SITUATION
1. The position as regards supplies of large coal is giving rise to most serious anxiety and shows every sign of becoming critical. The essential minimum support now being given to the gas works and the railways has produced a most serious deficiency of house coal, stocks of which amount to 967,000 tons. At this level they are over 600,000 tons less than a year ago and in fact lower than in any year since the war.
2. Since 1946 the position at the end of August has been as follows:
| Year | Tons, 000's | |------|-------------| | 1946 | 1,394 | | 1947 | 1,353 | | 1948 | 1,552 | | 1949 | 1,735 | | 1950 | 1,418 | | 1951 | 898 |
These figures, of course, reveal a most serious state of affairs bearing in mind that even with stocks up to twice as high as at present, we have had difficulty in getting through the winter without a breakdown, particularly last year.
3. The merchants report that the situation is already so bad that they are willing to buy untreated smalls rather than go without coal, and have strongly pressed me to make substantial quantities available. I consider it essential to meet this request even though untreated smalls are in 10 per cent. deficiency. A transfer of this kind to the house coal market is not practicable except at the expense of engineering and other industry, whose present stock position is fairly satisfactory, or of power stations, which I am most unwilling to touch, as the stock position is weaker and next winter's requirements are likely to be very heavy. I have given instructions, therefore, that as an emergency measure 150,000 tons of untreated smalls should be transferred from industry to the house coal market between now and end of October; I am informally consulting the F.B.I. and Industrial Coal Consumers' Council on this proposal.
4. This diversion is no more than a palliative. It is quite insufficient to make good the shortage of house coal but represents the most that it is possible to do with available British supplies. Even allowing for this addition the house coal deficit is likely to be over 1 million tons. Whether this relief can be continued during the winter without harm to the power stations or industry is at present conjectural: the winter budget prospects so far as I am able to gauge them now, suggest that this is doubtful. The diversion of large coal from the gas programme would be possible only if gas works stocks were to reach a level of five weeks, and their prospects of doing so appear at present to be poor.
5. As regards imports, the outlook for Polish coal is precarious, and although the Foreign Office are pressing the matter, it is impossible as yet to rely upon help from this source. The import of 250,000 tons of Indian coal already approved will help the gas works but we cannot yet assume that this will mean an equivalent relief to our house coal difficulties. I fully appreciate the strong objections on balance of payments, freight and shipping grounds to any import of American coal and recognise the bad effect which such imports would have on our European friends. I consider, however, that an increase in freight rates (if that should take place) may well be a less serious disaster than a breakdown of house coal supplies. Nor should it be assumed that other imports, even for instance iron ore, would necessarily be more important to us next winter than coal imports.
6. On present prospects the house coal situation after Christmas will be such that the import of 250,000 tons from the United States may be absolutely essential to lessen the risk of a breakdown. CABINET
PRESS ARTICLES AND INTERVIEWS BY MINISTERS
NOTE BY THE PRIME MINISTER
The normal rules governing Press articles and interviews by Ministers are set out in C.P. (49) 95, paragraphs 45-49, as follows:
"45. Ministers are precluded from journalism in any form; but this prohibition does not extend to authorship of writings of a literary, historical, scientific, philosophical or romantic character. For these there are abundant precedents.
46. This rule need not be interpreted as debarring Ministers from writing, on occasion, articles or letters to newspapers, in order to supplement the means already used for enlightening the public in regard to measures before Parliament and other administrative questions affecting the work of their Departments.
47. Should a Minister deem it necessary to write such an article, he should not accept payment if it is offered. In deciding whether to write an article he should bear in mind his obligations to Parliament. For example, he should be careful not to discuss a Bill before it has received its Second Reading in the House of Commons.
48. These rules govern dealings with the foreign as well as the home Press.
49. The granting of special interviews to individual Press representatives is a matter for the discretion of the Minister concerned. As a general rule, however, the same considerations should apply as for written articles, i.e., if granted, an interview should be confined to elucidating the policy or work of the Minister and Department concerned. The same considerations regarding obligations to Parliament also apply, and Ministers should bear in mind that an interview granted to a representative of a single newspaper or agency may arouse jealousy and thus hostility in the rest of the Press."
[P.T.O.]
41258 2. In present circumstances greater freedom may properly be allowed. Ministers may give interviews to the Press, and, in accordance with precedent, when Parliament has been dissolved they may also write articles in any newspapers in prosecution of the Government's aims, or in defence of its policy. No payment may, however, be received for such articles.
3. As soon as the Election is over the normal rules set out in paragraph 1 above will again apply.
C. R. A.
10 Downing Street, S.W. 1, 26th September, 1951. THE OIL DISPUTE WITH PERSIA
Memorandum by the Secretary of State for Foreign Affairs
The 1901 Concession
The original agreement for the exploitation of oil resources in South Persia was entered into between the Persian Government and Mr. W.K. D'Arcy on the 28th May, 1901. It included the following provisions:
(a) The exclusive right for 60 years to exploit petroleum throughout the Persian Empire, with the exception of five provinces in Northern Persia.
(b) On the date of the formation of the first exploitation company the Persian Government was to receive £20,000 in cash, £20,000 in paid up shares, and "annually a sum equal to sixteen per cent" of the Company's profits.
(c) On expiration of the concession all "materials, buildings, and apparatuses" of the company should become the property of the government.
2. Oil in commercial quantities was discovered at Masjid-i-Sulaiman in 1908, and the Anglo-Persian Oil Company (now the Anglo-Iranian Oil Company (A.I.O.C.)) took over Mr. D'Arcy's rights in 1909.
His Majesty's Government's relations with the A.I.O.C.
3. In 1914 an agreement was made between the Treasury and the Company which was directed to ensuring supplies of fuel oil for the Navy and to making sure that these supplies, which would be required in increasing quantities, were purchased by the Government at reasonable prices. His Majesty's Government subscribed to the Company a total of £2,200,000. They became entitled to appoint two Government Directors; and held by virtue of their capital subscription a majority of the share votes. (The situation at the present date is that His Majesty's Government has a majority share holding - 55.86% of the ordinary shares, and a majority also of votes - 52.55%.) The arrangement between Treasury and the Company conferred on the Government directors a right of veto which, however, the Government undertook not to exercise except in certain circumstances.
The 1933 Concession
4. The provision in the D'Arcy contract which provided that the Persian Government would receive a royalty defined as "16% of the net annual profits" proved periodically to be a source of differences of opinion as to its interpretation. The main feature of this method of payment was that the Persian income from oil was tied directly to trading results, and the slump of the early 1930's had its effect on Persia. The question was brought to a head in July, 1932, when it was announced that the Persian Government would receive only £307,000 in respect of royalty for the preceding year. (This sum compared with £1,288,000 in respect of 1930 which was paid on almost the same quantity of oil produced.)
5. The Persian Government's attack on the Company began with an organised and abusive press campaign. There were comparisons between the share due to the Persian Government by way of royalty and that due to the British Government by way of income tax and dividends.
6. The Company was accused of falsifying accounts and wilfully defrauding the Persian Treasury. In November, 1932, the Company's Manager in Persia was handed a Note by the Persian Government declaring the Concession cancelled on grounds of the Company's failure to accept modifications: and subsequently the Persian Minister for Foreign Affairs stated that the stipulations of the Concession were not in accord with the legitimate interests of Persia. The numerous complaints against the Company included accusations that the amount of royalty had been unfairly arrived at and that the Company had failed to exploit their concession areas fully.
7. His Majesty's Minister in Tehran informed the Persian Government that their action in cancelling the Concession was a wholly inadmissible breach of its terms and asked for an immediate withdrawal. As the Persian Government persisted in their refusal of this demand, His Majesty's Government on the 14th December submitted the matter to the Council of the League of Nations. Before the case was heard, however, the parties, while reserving their respective legal points of view, agreed to enter into a provisional arrangement to undertake negotiations for a new Concession.
8. On the 3rd April Sir John Cadman of the A.I.O.C. arrived in Tehran and negotiations were begun. The Persian Minister prepared a statement of their desiderata, which were considered fantastic in their scope. It was made clear that their proposals were entirely unacceptable and that no agreement could possibly be based on them. On the 21st April the Company submitted a memorandum, which was essentially a draft of a new Concession. The Ministers stated that an agreement on this basis was equally impossible. Sir John Cadman then asked for a farewell audience with the Shah, at which the latter consigned the Persian proposals to the wastepaper basket and virtually agreed to the Company's draft Concession contract, which was rapidly finalised and ratified on the 28th May.
9. This agreement embodied a new formula for royalties which henceforward could be calculated under three headings:
(i) a fixed sum per ton of oil exported or sold in Iran. This was to be 4s. per ton subject to adjustment to compensate the Government for any fluctuations in the value of English currency as compared with the value of gold in London, taking the 1933 price as par.
(ii) a sum varying between 6d. and 1s. per ton similarly adjusted in gold in consideration of exemption from Iranian taxation on the Company's operations. that the Persian income from oil was tied directly to trading results, and the slump of the early 1930's had its effect on Persia. The question was brought to a head in July, 1932, when it was announced that the Persian Government would receive only £307,000 in respect of royalty for the preceding year. (This sum compared with £1,288,000 in respect of 1930 which was paid on almost the same quantity of oil produced.)
5. The Persian Government's attack on the Company began with an organised and abusive press campaign. There were comparisons between the share due to the Persian Government by way of royalty and that due to the British Government by way of income tax and dividends.
6. The Company was accused of falsifying accounts and willfully defrauding the Persian Treasury. In November, 1932, the Company's Manager in Persia was handed a Note by the Persian Government declaring the Concession cancelled on grounds of the Company's failure to accept modifications: and subsequently the Persian Minister for Foreign Affairs stated that the stipulations of the Concession were not in accord with the legitimate interests of Persia. The numerous complaints against the Company included accusations that the amount of royalty had been unfairly arrived at and that the Company had failed to exploit their concession areas fully.
7. His Majesty's Minister in Tehran informed the Persian Government that their action in cancelling the Concession was a wholly inadmissible breach of its terms and asked for an immediate withdrawal. As the Persian Government persisted in their refusal of this demand, His Majesty's Government on the 14th December submitted the matter to the Council of the League of Nations. Before the case was heard, however, the parties, while reserving their respective legal points of view, agreed to enter into a provisional arrangement to undertake negotiations for a new Concession.
8. On the 3rd April Sir John Cadman of the A.I.O.C. arrived in Tehran and negotiations were begun. The Persian Minister prepared a statement of their desiderata, which were considered fantastic in their scope. It was made clear that their proposals were entirely unacceptable and that no agreement could possibly be based on them. On the 21st April the Company submitted a memorandum, which was essentially a draft of a new Concession. The Ministers stated that an agreement on this basis was equally impossible. Sir John Cadman then asked for a farewell audience with the Shah, at which the latter consigned the Persian proposals to the wastepaper basket and virtually agreed to the Company's draft Concession contract, which was rapidly finalised and ratified on the 28th May.
9. This agreement embodied a new formula for royalties which henceforward could be calculated under three headings:
(i) a fixed sum per ton of oil exported or sold in Iran. This was to be 4s. per ton subject to adjustment to compensate the Government for any fluctuations in the value of English currency as compared with the value of gold in London, taking the 1933 price as par.
(ii) a sum varying between 6d. and 1s. per ton similarly adjusted in gold in consideration of exemption from Iranian taxation on the Company's operations. a sum equal to 20% of any distribution of the Ordinary stockholders of the Company, whether as dividends or in relation to General Reserve, in excess of a certain minimum annual sum (£671,280).
10. In addition the Persian Government would be entitled to a sum equal to 20% of the difference between the Company's General Reserve at the end of the Concession and the General Reserve at 31st December, 1932. (N.B. These payments were not given a gold guarantee.)
11. The new formula was designed to relate income more or less to production, although item (iii) provided a means whereby the Persian Government was also in a position to participate in the Company's prosperity during good years: (i) and (ii) however, ensured that Persia did not suffer serious financial and material loss in bad years.
12. In August, 1933, identical letters were addressed by the United Kingdom and Persian Governments to the Registrar of the Permanent Court of International Justice bringing to the notice of the Court Article 22 of the Convention whereby the parties agreed in certain circumstances to have recourse to the good offices of the President (or Vice-President) of the Court in connection with the nomination of an umpire or sole arbitrator, and asking the Court to accept these functions. The Registrar of the Court replied that the Court saw no objection to their acceptance of these functions.
The Supplemental Oil Agreement, 1949
13. In the spring of 1948 the Prime Minister informed H.M. Ambassador that there was much criticism of the share which the Persian Government was receiving from the operation of A.I.O.C., as compared with the Governments of Venezuela and Iraq from the operations of their concessionary companies. He made it clear at the same time, however, that the Government was not demanding an alteration of the concession as a right. As a result the A.I.O.C. agreed to enter into negotiations with the Persian Government for a revision of some of the terms of the 1933 Concession. After a protracted and difficult negotiation (during which complaints were, inter alia, again made about the relative size of His Majesty's Government's receipts from the Company in the form of taxation) the document known as the Supplemental Oil Agreement was drawn up and signed by the Minister of Finance in July, 1949, subject to ratification by the Persian Majlis.
14. This agreement did not really alter the 1933 formula (see paragraph 9). Payments under item (i) were increased from 4s. to 6s. gold and under item (ii) to 1s. gold. Item (iii) was also altered in Persia's favour to provide for an immediate payment to the Government in respect of the sum standing at General Reserve at the 31st December, 1947, and further payments (equal to 20%) in respect of allocations to General Reserve thereafter. It was further provided that these payments should be entirely free from the effect of British Income Tax, and that the total annual payments in respect of dividend and allocation to General Reserve should be a minimum of £4,000,000.
15. If the agreement had been ratified the effect of these provisions would have been as follows:
| Year | Under Concession | Under Supplemental Oil Agreement | Difference | |------|------------------|----------------------------------|------------| | 1948 | £9.17m. | £23.76m. | £14.59m. | | 1949 | £13.5m. | £22.9m. | £9.41m. | | 1950 (Est.) | £16.0m. | £30.0m. | £14.0m. |
*Includes a payment of 55.09m. in respect of 1947.*
16. The Supplemental Agreement could be submitted to the Majlis in July, 1949, only just before the latter was prorogued, and was accordingly not voted upon. When a new Majlis was elected in September the Ministry of Finance urged upon the Company the necessity for revising the Agreement so as to make it more acceptable to the new Majlis. The Company replied that the Supplemental Oil Agreement was the result of long and difficult negotiations and they could not hold out any hope of amending it, and they pointed out that, in any case, the Majlis had not yet reached any decision on it. When Mansur became Prime Minister early in 1950, the Shah instructed him to get the Supplemental Agreement through the Majlis, but he was uncertain how to do so and, in the event, merely staved off the issue by presenting the Agreement to the newly-elected Majlis and allowing it to be referred to a special Commission of the Majlis which, though it was supposed to contain equal representation of the various fractions in the House, in fact contained 5 members of the National Front in its total membership of 18. Mansur later fell from office and was replaced by General Razmara.
The Razmara Episode
17. General Razmara had a reputation for strength, and from numerous interviews with H. M. Ambassador it appeared that he himself genuinely favoured the Supplemental Agreement, although he wished to see it modified in certain respects. His position vis-à-vis the Majlis was weakened by his unsuccessful attempts to promote legislation for administrative reform. He was reluctant to give the Supplemental Agreement his open support and his public references to it were in equivocal terms. The bill embodying the Agreement therefore remained with the Majlis Oil Commission which, in November, 1950, recommended to the Majlis that it did not sufficiently secure Persian interests. Razmara's Finance Minister was put up to make a belated defence of the Agreement and to withdraw it from the Majlis. His speech was criticised on all sides, and he was forced to resign; the Majlis later voted its approval of the Commission's report. At the end of the year, the National Front, with its handful of representatives in the Majlis, was energetically exploiting the situation, openly threatening the lives of anyone inside and outside the Majlis who favoured the Supplemental Agreement and - finally - raising the cry of nationalisation. This was taken up by student demonstrators organised by the National Front, and the Majlis Commission began to formulate proposals to this end.
18. If the agreement had been ratified the effect of these provisions would have been as follows:
| Year | Under 1933 Concession | Under Supplemental Oil Agreement | Difference | |------|-----------------------|----------------------------------|------------| | 1948 | £9.17m. | £23.76m. | £14.59m. | | 1949 | £13.5m. | £22.9m. | £9.4m. | | 1950 (Est.) | £16.0m. | £30.0m. | £14.0m. |
- Includes a payment of 55.09m. in respect of 1947.
16. The Supplemental Agreement could be submitted to the Majlis in July, 1949, only just before the latter was prorogued, and was accordingly not voted upon. When a new Majlis was elected in September the Ministry of Finance urged upon the Company the necessity for revising the Agreement so as to make it more acceptable to the new Majlis. The Company replied that the Supplemental Oil Agreement was the result of long and difficult negotiations and they could not hold out any hope of amending it, and they pointed out that, in any case, the Majlis had not yet reached any decision on it. When Mansur became Prime Minister early in 1950, the Shah instructed him to get the Supplemental Agreement through the Majlis, but he was uncertain how to do so and, in the event, merely staved off the issue by presenting the Agreement to the newly-elected Majlis and allowing it to be referred to a special Commission of the Majlis which, though it was supposed to contain equal representation of the various fractions in the House, in fact contained 5 members of the National Front in its total membership of 18. Mansur later fell from office and was replaced by General Razmara.
The Razmara Episode
17. General Razmara had a reputation for strength, and from numerous interviews with H.M. Ambassador it appeared that he himself genuinely favoured the Supplemental Agreement, although he wished to see it modified in certain respects. His position vis-à-vis the Majlis was weakened by his unsuccessful attempts to promote legislation for administrative reform. He was reluctant to give the Supplemental Agreement his open support and his public references to it were in equivocal terms. The bill embodying the Agreement therefore remained with the Majlis Oil Commission which, in November, 1950, recommended to the Majlis that it did not sufficiently secure Persian interests. Razmara's Finance Minister was put up to make a belated defence of the Agreement and to withdraw it from the Majlis. His speech was criticised on all sides, and he was forced to resign; the Majlis later voted its approval of the Commission's report. At the end of the year, the National Front, with its handful of representatives in the Majlis, was energetically exploiting the situation, openly threatening the lives of anyone inside and outside the Majlis who favoured the Supplemental Agreement and - finally - raising the cry of nationalisation. This was taken up by student demonstrators organised by the National Front, and the Majlis Commission began to formulate proposals to this end.
18. His Majesty's Government, who had hitherto confined their intervention in the matter to unofficial representation, felt that in the light of this direct threat to the Company's position they must take steps to make their position clear. Accordingly, in a Note Verbale dated 28th February, 1951, they informed the Persian Government that in their view the Company's concession agreement, under its Articles 21 and 26, could not legally be terminated by an act such as nationalisation, and added that the Company could not negotiate under threat of nationalisation. Meanwhile on 10th February the Company, in order to strengthen Razmara's hand, not only informed him that they were ready to negotiate an entirely new Agreement based on an equal sharing of profits but offered him substantial monetary support (£5 millions at once and £2 millions a month for ten months, all in advance of future royalties) in order to assist the Persian Government in their immediate financial difficulties. Razmara preferred, however, not to reveal this offer to the Oil Commission and the Majlis and attempted to avert a nationalisation resolution in another way. He appeared before the Oil Commission in order to deliver reports from Persian technical, financial and legal experts which were unfavourable to nationalisation. This action undoubtedly led to his assassination three days later.
Development of "nationalisation"
The Majlis resolution
19. After the assassination of the Prime Minister on the 7th March the Oil Commission lost no time in passing its resolution "accepting the proposal that oil should be nationalised throughout Persia" and requesting an extension of the Commissions mandated for two months for examination of the principle of nationalisation. The Majlis agreed to consider this resolution as a matter of "double urgency" and it was approved by both Houses by the 20th March.
20. On the 26th April, i.e. in considerably less than two months, Dr. Musaddiq, the Chairman of the Oil Commission suddenly called a meeting and expressed his intention of pressing for a decision on the question of nationalisation. The following day the Commission approved the text of a resolution onjoining the implementation of the "decision of the Houses of Parliament for oil nationalisation throughout the country" and setting out in 9 articles the method of implementation. Once again this resolution (the so-called "9-Point Law") was hustled through the Majlis and it received the approval of both Houses by the 30th April. The Shah promulgated the law on 2nd May.
Establishment of the Oil Board
21. The law provided for the setting-up "with a view to arranging the enforcement of the law" of a mixed Board composed of five senators and five deputies elected by either of the two Houses and a representative of the Minister of Finance. The final appointments took place on 15th May. At least five of the members were supporters of the National Front. The establishment of the "National Iranian Oil Company" followed and the Persian Government thereafter persisted in referring to the A.I.O.C. as "the former Company".
22. The position was clearly fraught with danger and since it was imperative that we should discuss with the Americans both the Persian situation itself and its manifold repercussions a party went to Washington early in April.
23. The Americans had not supported us in the past in our dealings with the Persians on oil. In Persia they had declared their neutrality in the matter, an attitude which the Persians interpreted as disapproval of our policy. To us they frequently criticised the Company's actions and attitude. They felt very satisfied with their own policy, exemplified by the 50/50 profit-sharing agreement concluded in Saudi Arabia and thought that we, on the other hand, were being slow and were not keeping up with the development of feeling in Persia. The talks in Washington in April failed to bring them solidly into line with us. It proved at the outset that they and we held widely differing views on the strength and nature of the demand for nationalisation in Persia. In their view, a "low bow to nationalisation" was needed if we were to have any hope of stabilising the situation. We thought that a solution based on equal sharing of profits was possible, and that greater capitulation would be regarded as a sign of weakness. Consequently although during the discussion the Americans were prepared to agree piecemeal with the United Kingdom's aims and objectives, including the fact that it was vital for the United Kingdom to retain effective control over Persian oil, they were not prepared to co-operate with us in attempting to reconcile our essential needs and Persian aspirations and independence in the shape of the minimum that need be given away during the negotiations. Thus, while they never expressed in detail precisely what would be involved in their own "low bow to nationalisation" the form of a proposal which was drawn up in London and Washington during the talks and which was handed to Hussein Ala on 26th April was not such as to induce them to give us their active support, and the most they would promise was benevolent neutrality.
The Musaddiq period
24. On the day that this proposal was made, however, the Oil Commission passed its second nationalisation resolution which was almost identical with the final nationalisation law (paragraph 20 above) and Hussein Ala resigned while this was before the Majlis because he could neither oppose it nor give his support. He was replaced by Dr. Musaddiq, somewhat to the surprise even of the Shah and Sayyid Zia, who had on the same day been discussing bringing the latter into power. On the day after his resignation the Company handed to him a protest against the Oil Commission's resolution.
25. The pace of events in Persia was now alarmingly swift. At this stage the Foreign Secretary on 1st May made a deliberately moderate statement in the House of Commons which briefly recounted the history of the Oil Concession since 1901, recapitulated the issues at stake and outlined the proposal (paragraph 23) which had been put to Hussein Ala. The statement ended by saying that we were still most anxious to settle the matter by negotiation but that we could not negotiate under duress.
26. On the following day, the Foreign Secretary sent for the Persian Ambassador and requested that the Persian Prime Minister should be asked to suspend action and allow time for discussion. The Foreign Secretary also said that we could not accept "unilateral action, which would have the effect of upsetting the Agreement of 1931".
27. On 8th May the Persian Government replied affirming their determination to proceed with the programme of nationalisation, but concluding with a statement that the "former oil company" would be invited in a few days to discuss the implementation of the law.
28. In response to this intransigent communication, it was decided that a very strongly worded Note should be sent to the Persian Government asking them to agree to negotiations and giving warning that a refusal to negotiate, or any attempt to proceed by unilateral action to the implementation of the recent legislation would have "the most serious consequences". A further attempt was also made to enlist American support. It was clear, however, from the State Department's reply that they were not prepared at this juncture to offer support in the use of force if the present Persian Government should refuse to negotiate, although they would be prepared to acquiesce in the use of force on our part either to protect British lives or in the event of a Communist coup in Persia.
Application to the Hague Court
29. At this point the Company served notice on the Persian Government that they wished the dispute to be submitted to arbitration in accordance with the terms of the 1931 Concession Agreement. The Persian Government rejected this request on the 26th May and demanded that the Company's representatives should attend meetings for the liquidation of the Company. The Company then applied under the terms of the 1935 Agreement to the President of the International Court at The Hague to appoint a sole arbitrator between themselves and the Persian Government. At the same time His Majesty's Government submitted the matter to The Hague Court as a dispute between the United Kingdom Government and the Persian Government.
The A.I.O.C. Mission
30. The Company sent out a delegation of Directors on the 11th June to try to convince the Persian Government of the consequences of their policy of immediate expropriation of the Company's installations in Persia and to offer an alternative that would give them money for their present needs, acceptance of the principle of nationalisation and a foundation for partnership in the future. After meetings at which the Persian Delegation proved completely intransigent, insisting that all proposals must be in accordance with the Nationalisation Law, the Company on the 19th June made an offer which provided for an immediate payment of £10,000,000 and a sum of £3,000,000 a month from July onwards during the period necessary to reach an arrangement. The offer also provided for the vesting of the Persian assets of the A.I.O.C. in the National Iranian Oil Company (N.I.O.C.) on condition that the latter would grant to a new company established by the A.I.O.C. the exclusive use of these assets. This offer was summarily turned down by the Persian Delegation on the ground that it was not consistent with the Nationalisation Law, and the Company Delegation returned to the United Kingdom.
31. In the meantime the general situation in Abadan and the oilfields area had been deteriorating. The temporary Board of Directors and the N.I.O.C. began to interfere in the A.I.O.C.'s operations and members of the Board delivered a series of inflammatory speeches. Moreover they issued instructions that the Masters of tankers carrying oil from Abadan would be required before sailing to give a receipt to the N.I.O.C. on its own form. As the Persians refused to allow a clause to be added to this receipt reserving the legal rights of the A.I.O.C., tanker Masters refused to sign. The A.I.O.C.'s General Manager was thereupon accused by the Persians of sabotage, and left the country as a Bill had been presented to the Majlis on the 21st June introducing the death penalty for such an offence; though after strong representations by His Majesty's Government and the United States Government Dr. Musaddiq announced that the Bill would be withdrawn. At the same time H.M.S. Mauritius was sent to Iraqi waters opposite Abadan and all women and children were evacuated from the oilfields and from Abadan.
32. On the 5th July the International Court made an Order calling upon the Persian Government and the A.I.O.C. to do nothing which would aggravate the dispute, the A.I.O.C. in the meantime to be permitted to carry on their industrial and commercial operations as they had been doing prior to the 1st May under the supervision of an Anglo-Persian Board with one neutral member. On the 7th July His Majesty's Government informed the Persian Government that they accepted the Court's Order in full. On the 9th July the Persian Government informed the Secretary-General of the United Nations that they rejected the Court's Order.
Lord Privy Seal's Mission
33. On the 8th July the President of the United States offered to send Mr. Averell Harriman to Persia to discuss the situation with Dr. Musaddiq, at the same time drawing attention to the International Court's Order and urging the Persian Government to treat it with all possible consideration. Mr. Harriman arrived in Tehran on the 15th July. In the course of discussions with Dr. Musaddiq he eventually on the 24th July persuaded the Persians to agree to open negotiations with the British Government on the basis of the following formula:
"In the case of the British Government, on behalf of the former Anglo-Iranian Oil Company, recognising the principle of the nationalisation of the oil industry in Persia, the Persian Government would be prepared to enter into negotiations with representatives of the British Government on behalf of the former Company."
While this formula seemed to offer a chance for negotiations, His Majesty's Government considered that it was unlikely that the negotiations would be fruitful unless the Persian Government first undertook to improve the conditions in South Persia which had deteriorated throughout the month of July.
4. A point had been reached by the middle of July at which it had been decided to withdraw the staff from the oilfields of Abadan, but the decision was suspended in deference to Mr. Harriman's views, as he considered that to do so would prejudice his chances of opening negotiations. Production at the refinery gradually decreased until on 31st July it ceased to operate because the storage tanks were full. On the 30th July the Prime Minister stated in the House of Commons that although there might have to be a withdrawal from the oil wells and from some parts of Abadan, it was His Majesty's Government's intention not to evacuate Abadan entirely. In confirming this statement in the House of Lords the Lord Chancellor added that His Majesty's Government accepted all the implications that follow from the decision. As a precautionary measure the Persian Gulf Squadron of three frigates was reinforced by four destroyers from the Mediterranean.
5. Meanwhile Mr. Harriman decided to fly to London to discuss the situation with His Majesty's Government and on his return, after further talks with Dr. Musaddiq, he was able to assure His Majesty's Government that the Persian Government recognised the necessity for improving the atmosphere, particularly in South Persia, and that the Persian Government had agreed to negotiate on the basis of the Law of 20th March, 1951 (paragraph 19) and would not insist on the application of the Nationalisation Law of 1st May (paragraph 20). It has subsequently become apparent from a speech of Dr. Musaddiq in the Majlis on 9th September that he only agreed to this formula because he was sure that negotiations would lead to no result.
6. After receiving these assurances, His Majesty's Government addressed to the Persian Government a note to which Mr. Harriman had agreed after consulting Dr. Musaddiq. This note accepted the formula mentioned in paragraph 35 above and pointed out that the negotiations could not be conducted in a satisfactory manner unless the present atmosphere was relieved. The note recognised on behalf of His Majesty's Government and of the Company the principle of the nationalisation of the oil industry in Persia. In their reply the Persian Government for their part recognised the need for creating the best possible atmosphere in the interests of the success of the negotiations. His Majesty's Government's mission, headed by Mr. Stokes, the Lord Privy Seal, left for Persia on 3rd August.
The 8-Point Proposals
7. Mr. Harriman and his advisers had endeavoured to prepare the way for the Lord Privy Seal's Mission by impressing upon the Persians their inability to market their own oil and appeared to have achieved some success. It was clear from the preliminary conversations that the Persians were awaiting a lead from the mission. Mr. Stokes therefore decided to put forward proposals (See Annex A) which, while offering the Persians nationalisation and the withdrawal of A.I.O.C. as such from Persia, were designed to ensure (a) efficient production of the oil, (b) a large offtake of oil, and (c) availability of a large quantity of oil to those British interests which have developed it. For the purpose of (a) it was essential to retain the British technical staff and to have a sound operating organisation, substantially under British control, in which the British technical staff could have confidence.
8. These proposals which were made on the 13th August have become known as the "8-Point proposals". While details of this scheme were subject to negotiation, it represented in broad outline the maximum concession to Persian demands consistent with a business-like solution of the problem.
9. The Persian Government refused to discuss these proposals but issued a statement in which they announced, quite wrongly, that the proposals did not conform to the formula on the basis of which negotiations had begun. They contended that, according to this formula, the only problems which could be discussed were:
(a) The purchase of oil to meet the United Kingdom's own requirements. (b) Examination of the compensation to be paid to the A.I.O.C. (c) The employment of British technicians by the N.I.O.C.
To confine the discussion to these three points meant in effect a reversion to the terms of the oil nationalisation law of 1st May, which we had made clear we could not accept as a basis for discussions. 40. During private negotiations with Mr. Stokes, Dr. Musaddiq appeared ready to discuss the formation of a purchasing organisation, but he insisted that the British and Persian staff in the industry should be employed under a direct contract with the M.I.O.C., and that there was, therefore, no room for the operating organisation. In an attempt to obtain agreement at least on this one essential point, the Lord Privy Seal, after withdrawing his 8-Point proposals, explored various other ways of retaining British management. It soon became clear that Dr. Musaddiq was not prepared to accept any of these and the Lord Privy Seal therefore decided to suspend negotiations and left for London on 23rd August. Mr. Harriman left two days later.
Events after the return of the Lord Privy Seal's Mission
41. With the withdrawal of the Lord Privy Seal's mission and of Mr. Harriman from Tehran, His Majesty's Government let it be known that they regarded the negotiations as suspended. It was hoped that Dr. Musaddiq would realise that he could not induce us to yield to his demands and that, if he wished for a solution which would enable the flow of oil from Persia to be resumed, he would have to come forward with constructive proposals on which negotiations could be resumed. In the event, finding himself under increasing attack from Opposition circles for failing to produce a solution of the oil dispute which would give Persia £30,000 a day (a sum he had often quoted in the past) and no doubt impelled to further action by the more extreme members of his entourage, Dr. Musaddiq in the course of an unusually intransigent speech in the Senate on 5th September, stated that if His Majesty's Government did not return a satisfactory answer within two weeks to his latest "proposals" the residence permits of the A.I.O.C. staff in Persia would be cancelled. In the face of this "ultimatum", and in order to strengthen the hands of those deputies in the Majlis who were showing opposition to Musaddiq, it was considered essential to make it clear to the Persian deputies and people that His Majesty's Government had abandoned hope of being able to reach a settlement with him, the implication being that if the Persians wanted a settlement it was for them to withdraw their confidence in Musaddiq and ensure his resignation. His Majesty's Government therefore announced on the 5th September that they regarded the negotiations between themselves and the Persian Government as definitely broken off.
42. It was decided on the 10th September to withdraw certain special benefits which had previously been given to Persia in view of the advantages to the United Kingdom economy deriving from Persian oil supplies. These measures, which were designed to protect the United Kingdom economy and were not retaliatory, limited Persia's facilities in the use of sterling and the purchase of certain scarce goods. As a corollary cargoes of scarce goods en route to Persia, amounting to 3,000 tons of railway track equipment and 3,000 tons of sugar, were requisitioned. The Persian Government's riposte to these measures was to withdraw permission from the British Bank of Iran and the Middle East to deal in foreign exchange.
43. Meanwhile, the A.I.O.C. had decided, with His Majesty's Government's approval, to cease paying their Persian staff in Abadan, save for some 7,000 workers who will be engaged on maintenance and other essential services, at the end of September.
44. In the belief that the Shah alone is capable of replacing Musaddiq with a more reasonable government with which we can negotiate, H.M. Ambassador at Tehran, under instructions, had an audience of the Shah on the 11th September, in which he reaffirmed His Majesty's belief that nothing was to be hoped for from the present Persian Government, and strongly urged that His Majesty should take steps to replace the present government with one better fitted to safeguard the country's real interests.
45. On the 12th September Dr. Musaddiq sent Mr. Harriman, for communication to His Majesty's Government, what he described as new proposals for the settlement of the oil dispute, which included the "ultimatum" in regard to the British staff referred to in paragraph 41 above. Mr. Harriman refused to pass on this communication, and in a firm reply pointed out that the so-called proposals were in some respects a retrogression from the attitude which Dr. Musaddiq had previously taken up, and that the issue of the "ultimatum" in regard to the British staff could only aggravate the situation.
46. The Shah, in a further conversation with Sir F. Shepherd on the 17th September, appeared more frightened of making a change of government than of letting Dr. Musaddiq remain in power, and therefore urged Sir F. Shepherd to have further discussions with Dr. Musaddiq, which Sir F. Shepherd declined to do. On the 19th September, as a result of this conversation, the Minister of Court brought H. M. Ambassador an unsigned and undated piece of paper, apparently emanating from Dr. Musaddiq, containing further suggestions for a settlement. These suggestions represented a slight advance on Dr. Musaddiq's previous offers, but were still wholly unsatisfactory in regard to the all-important question of the position of the British staff. Since it appeared that Dr. Musaddiq's principal object in putting forward these suggestions was to be able to say in the Majlis on the 23rd September that he was in negotiation with His Majesty's Government on the oil issue, His Majesty's Government at once announced that the proposals were unacceptable as a basis for negotiation.
47. On the 25th September the Persian Government announced, without any notification to His Majesty's Government, that the remaining British staff in Abadan would be given seven days' notice in which to quit the country. This step represented a final flouting by Dr. Musaddiq of the interim decision of the Hague Court and, unless rescinded, would clearly render far more difficult a solution of the dispute and would therefore hasten the economic collapse of Persia.
H. M.
Foreign Office, S. W. 1.
26TH SEPTEMBER, 1951. ANNEX A
OUTLINE OF SUGGESTIONS SUBMITTED TO THE PERSIAN DELEGATION ON 13TH AUGUST, 1951 BY THE BRITISH DELEGATION WITHOUT PREJUDICE TO ANY PARTY CONCERNED
1. A.I.O.C. will transfer to N.I.O.C. the whole of its installations, machinery, plant and stores in Iran. As regards the assets in southern Iran compensation by N.I.O.C. to A.I.O.C. would be included in the operating costs of the oil industry in the area. Compensation for the assets used in the past for distribution and marketing in Iran will be dealt with under the separate arrangements suggested in paragraph 7 below.
2. A Purchasing Organisation will be formed in order to provide the assured outlet for Iranian oil which is the only basis upon which an oil industry of the magnitude of that of Iran could hope to maintain itself. This will be done by means of a long term contract, say 25 years, with N.I.O.C. for the purchase f.o.b. of very large quantities of crude oil and products from southern Iran.
3. Apart from this arrangement N.I.O.C. would be able to make additional sale of oil subject to the normal commercial provision that such sales should be effected in such a way as not to prejudice the interests of the Purchasing Organisation.
4. The Purchasing Organisation under the agreement will be placing at the disposal of the N.I.O.C. a world-wide transportation and marketing service, including one of the largest tanker fleets in the world, and will be entering into firm commitments with its customers for the fulfilment of which it will be relying on Iranian oil. It will, therefore, as a matter of normal commercial practice, have to assure itself that oil in the necessary quantities and qualities will come forward at the times required. In order to secure this objective the Purchasing Organisation will agree with N.I.O.C. an Organisation which, under the authority of N.I.O.C. will manage on behalf of N.I.O.C. the operations of searching for, producing, transporting, refining and loading oil within the area. The Purchasing Organisation will arrange from current proceeds the finance necessary to cover operating expenses.
5. In order that the proposed Purchasing Organisation can be induced to commit itself to the purchase of large quantities of Iranian oil over a long period of years, the commercial terms must be not less advantageous than the Purchasing Organisation would secure elsewhere either by purchase or development. In effect this means that the Purchasing Organisation would buy the oil from N.I.O.C. at commercial prices f.o.b. Iran less a price discount equal in the aggregate to the profit remaining to N.I.O.C. after allowing for the discount and for the costs of making the oil available to the Purchasing Organisation.
6. In the event of the foregoing suggestions being accepted by the Iranian Government as a basis for the future operation of the oil industry in southern Iran it is suggested that they should be expanded into the Heads of an Agreement which could later be developed into a detailed purchasing arrangement between the Iranian Government and the proposed Purchasing Organisation. The Heads of Agreement would also provide for the immediate resumption of operations in southern Iran on an interim basis.
7. It is suggested that all the assets owned by the Kermanshah Petroleum Company Limited which produces and refines oil for consumption in Iran, together with the installations, machinery, plant and moveable assets of A.I.O.C. which have been used in the past for distribution and marketing of refined products within Iran, should be transferred to the Iranian Government on favourable terms.
8. There will be Iranian representation on the board of directors (or its equivalent) of the Operating Organisation, which will, of course, only employ non-Iranian staff to the extent that it finds it necessary to do so for the efficiency of its operations. It will also offer its full co-operation to N.I.O.C., in any programme or training on which the latter may wish to embark.
NEWS DEPARTMENT 16th August, 1951. CABINET
USE OF OFFICIAL TRANSPORT FACILITIES DURING THE GENERAL ELECTION
NOTE BY THE PRIME MINISTER
Official Cars
1. Ministers' official cars or cars from the Official Car Service pool should not be used, even on repayment, for journeys connected with the Election, nor should they be used at all in a Minister's constituency.
2. Official cars may continue to be used for official engagements. This would include the case of a Minister unexpectedly recalled from his constituency for urgent official business.
Aircraft
3. Service aircraft should not be used for journeys on Election business.
4. Civil aircraft should not be paid for from public funds if used for journeys on Election or other Party political business; but exceptionally a Minister recalled unexpectedly to his Department for urgent official business may claim repayment of the cost of an air journey if no other means of transport would meet the case.
C. R. A.
10, Downing Street, S.W.1, 27th September, 1951. SECRET C.P.(51)259
2ND OCTOBER, 1951
CABINET
THE KING'S SPEECH ON THE PROROGATION OF PARLIAMENT
Memorandum by the Prime Minister
I circulate herewith, for the information of my colleagues, the revised text of The King's Speech on the Prorogation of Parliament, prepared in the light of the discussion at the meeting of the Cabinet on 27th October (C.M.(51)60th Conclusions, Minute 7).
C.R.A.
10, Downing Street, S.W.1.
2ND OCTOBER, 1951. THE KING'S SPEECH ON THE PROROGATION OF PARLIAMENT, 1950-51 SESSION
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS:
My Ministers have continued to give the fullest support to the United Nations in the maintenance of international peace and security.
It is My earnest hope that the efforts which are being made to restore peace in Korea will be successful. Under the United Nations My Forces have continued to take a prominent part in the arduous campaign in that country. The land forces from the various Commonwealth countries have been grouped together to form the First (Commonwealth) Division. The heroic action of the First Battalion, the Gloucester Regiment, maintained the highest traditions of My fighting services and has been justly acclaimed throughout the world.
My Ministers deeply regret that, although they made earnest efforts to find a basis for discussion, success did not attend the recent negotiations for a meeting of the Foreign Ministers of the Soviet Union, France, the United States and the United Kingdom.
My Government, in association with the other Governments signatory to the North Atlantic Treaty, have accepted the necessity for making greatly increased provision for defence, and the consequent strengthening of My Forces is already becoming apparent. I pray that, with God's help, the defence programme will succeed in its purpose of averting war and laying the foundations of a lasting peace throughout the world.
My Government have watched with sympathy and interest the progress made in building up, within the wider framework of the North Atlantic partnership, a European community in which Germany will play her part. My Government desire to establish a close association with this community at all stages of its development.
I welcome the appointment of General of the Army Eisenhower as Supreme Allied Commander, Europe. Units of My Forces have been placed under his command.
In order to increase the readiness of our defences, members of My Reserve and Auxiliary Forces have been recalled for periods of training of between fifteen days and three months, and for periods of service amounting in some cases to eighteen months.
My Ministers have tried to achieve by negotiation a solution of the unfortunate dispute which has arisen in connection with the oil industry in Iran, but these efforts, despite the help rendered by the President of the United States and his special representative, have so far been unsuccessful.
My Government, jointly with the Government of the United States, sponsored the Treaty of Peace with Japan which was signed by forty-eight nations at San Francisco on the 8th September. The Treaty was the result of a prolonged series of international consultations in which My Government in the United Kingdom and My Governments in other Commonwealth countries had played a leading part.
In Malaya further progress has been made in associating all communities with the administration of government and in furthering their welfare and prosperity. With the assistance of the peoples of Malaya and the civil administration, My troops have, with increasing success, continued their efforts to restore law and order and to bring communist banditry to an end.
The Prime Ministers of all the self-governing countries of the Commonwealth, or their representatives, met in London in January last to review the international situation and to consider what further positive action Commonwealth Governments could take to secure and preserve world peace. Since then, Ministers from the United Kingdom, Australia, New Zealand, South Africa and Southern Rhodesia have met in London to consider defence problems in regions of common concern, including the Middle East, and South African Ministers have met representatives of other interested Governments in Nairobi to consider defence facilities in Africa. The increase in production, which has been among the outstanding achievements of this country since the war, has continued in the face of many difficulties. For this success great credit is due to workpeople and management throughout the whole range of industry, agriculture and commerce. Despite the obstacles caused by shortages of materials and the high prices of many imports, full employment has been maintained, our exports have continued at a high level and the rearmament programme has been further advanced.
During the past session My Ministers were able to announce that, in agreement with the United States Government, it had been decided to suspend further allotments of Marshall Aid which had been so generously given to us by the people of the United States.
In order to restrain the rise in living costs provoked by high import prices, measures have been taken, by the operation of price control and otherwise, to limit the rise in the prices of goods and services.
I regret that, largely because of higher import prices, the balance of payments, which was remarkably favourable last year, has become less favourable in recent months.
I warmly welcomed the State visits of Her Majesty The Queen of the Netherlands and His Royal Highness Prince Bernhard of the Netherlands, Their Majesties The King and Queen of Denmark and His Majesty The King of Norway.
It gave me great pleasure to open in May last the Festival of Britain, in which the whole nation has displayed its talents and traditions in the arts and sciences. Despite the clouds which hang over the world, the celebrations throughout the land have given a powerful stimulus to the arts of peace and have provided opportunity for well-earned recreation of spirit. I am pleased that so many visitors from overseas have attended the Festival, which has thus contributed to international friendship and understanding.
My Ministers continue to attach importance to international co-operation and mutual aid in economic and social matters through the United Nations and other bodies. They welcomed delegates from Commonwealth and foreign countries to the tariff negotiations which were held last winter in Torquay, and have participated with other Commonwealth Governments in the plans for the economic development of South and South-East Asia. My Government continue to collaborate fully in the work of the Organisation for European Economic Co-operation.
My Ministers were glad to be able to exchange views at a meeting in London with My Ministers in other Commonwealth Governments concerned with the production of raw materials and the supply of manufactured goods, and to have the assistance of representatives from a number of Colonial territories in these deliberations.
My deep sympathy went out to My people in Jamaica when many parts of the island were devastated by a hurricane on the 17th August. My Ministers in the United Kingdom announced an immediate grant for relief.
MEMBERS OF THE HOUSE OF COMMONS: I thank you for the provision which you have made for the public services.
MY LORDS AND MEMBERS OF THE HOUSE OF COMMONS: Thanks to the determination of farmers and agricultural workers throughout a trying season, the programme for the expansion of the production of food at home has been carried on with unabated vigour.
An Act has been passed to extend the help given to farmers rearing livestock in upland areas.
My assent has also been given to a measure providing for the restoration to agriculture and other useful purposes of land broken up by the opencast working of ironstone.
Legislation has been passed to establish a White Fish Authority with powers to reorganise, develop and regulate the white fish industry; and a new scheme has been approved conferring wider powers on the Herring Industry Board. New provisions have been enacted for ensuring the purity of the rivers and other inland or coastal waters. An Act has also been passed to increase the contributions which may be made from the Exchequer towards the cost of schemes for rural water supply and sewerage.
My Government were gratified by the response which they received to their appeal for extra output from the coal mines. Higher levels of industrial production have, however, greatly increased the demand for fuel and power; and My Ministers have taken, and will continue to take, all practicable steps to encourage the recruiting of more miners, and to increase the supply of fuel, electricity and other forms of power and ensure their more efficient use.
Both sides of industry have recognised the need to remove obstacles to increased production and, with the full agreement of employers and workpeople, provision has been made to postpone the restoration of pre-war trade practices in industry.
The war-time measures for the prevention and settlement of trade disputes have been withdrawn and replaced by provisions more appropriate to peace-time conditions.
Legislation which will be of great benefit to a large number of My People has been passed to augment retirement pensions and the provision for widowed mothers and for children under the National Insurance Acts. National Assistance scales have been increased and improvements made in certain supplementary allowances paid to war pensioners.
Increases have been granted in the retired pay and pensions of My Regular Forces.
An Act has been passed to safeguard the civil interests of My Reserve and Auxiliary Forces.
Provision has been made for the setting up of a Courts-Martial Appeal Court to hear appeals against convictions by courts-martial.
My Ministers have continued to develop the organisation of the Civil Defence Services and have been in consultation with representatives of industry and commerce about civil defence in industrial and commercial undertakings.
I gave My assent to legislation to make temporary provision for the protection of the occupiers of certain classes of leasehold property in Great Britain.
An Act was passed which extends the powers and duties of the Forestry Commissioners to establish and maintain adequate reserves of growing trees.
A measure has been passed to provide more effective means of dealing with the poaching of salmon and trout in Scotland.
Further sums were made available for the development of the Colonial territories and the welfare of My peoples there.
Progress has been made in the consolidation of the Statute Law.
I pray that the blessing of Almighty God may attend you. CABINET
FUTURE OF THE SOUTH BANK SITE
Memorandum by the Lord Privy Seal
I recently circulated to the Prime Minister and to those of my colleagues principally concerned a report by a working party of officials on the winding up of the South Bank Exhibition, and the use of the site until work begins on the long-term developments which have already been planned by the London County Council with the agreement of the Ministry of Local Government and Planning.
2. The report by officials has been generally agreed, subject to one major issue which I discuss in the following paragraphs and to certain minor changes which in general I am willing to accept, and this being so I am availing myself of the authority which the Prime Minister has given for its agreed recommendations to be implemented.
3. There is, however, one point of policy on which I must seek a decision by my colleagues. The working party recommended that the major part of the section of the site upstream of Charing Cross railway bridge which has been earmarked in the long-term plan for new Government buildings should be handed over to the Ministry of Works as soon as exhibits have been removed from the Festival buildings - which should be by the end of December at latest - in order that they can proceed at once with certain urgent defence work which will eventually form part of the permanent Government building.
4. I disagree with this recommendation on three grounds:-
First, I think now that it would be a mistake to proceed with the idea of a Government building on the South Bank site;
Secondly, even if the policy of erecting a large Government office on the South Bank is re-affirmed I think it is rash, in the light of the New Colonial Office episode, to start excavation work until full plans for the scheme have been published and are known to be acceptable to public opinion, and
Thirdly, I fear that in practice there will be a long interval after the excavations and before the superstructure of the building can proceed during which the site will be closed to the public and will remain an eyesore.
5. The Minister of Works is unable to accept my views on this and I must therefore invite the Cabinet to adjudicate between us.
6. I hope that the Cabinet will invite the Minister of Works to re-examine with the Chancellor of the Exchequer and the Minister of Local Government and Planning and myself, and with the London County Council, the possibility of finding some other site for this Government office and releasing this part of the South Bank for cultural uses.
7. If, however, the Cabinet decide that the previous decisions (the latest of which is L.P. (48) 15th Meeting, Minute 2) should stand, I would still urge that the Minister of Works, before he begins operations on the site, should first prepare and make available for public criticism a complete architectural plan, and should produce evidence that the plan can be completed without serious risk of interruption.
R. R. C.
Office of the Lord Privy Seal,
1ST OCTOBER, 1951. CABINET
GENERAL ELECTION: ENQUIRIES BY CANDIDATES
NOTE BY THE PRIME MINISTER
Departments need guidance on the extent to which they should meet requests for information from Parliamentary candidates or their agents.
Factual information should be provided if it is readily available and is not confidential. In deciding whether information is readily available, a useful criterion is whether the information would be assembled for a Minister for the purpose of replying to a Parliamentary Question.
Local and regional offices should deal on this basis with any enquiries addressed to them; but they should refer doubtful cases to the headquarters of their Department for decision.
C. R. A.
10 Downing Street, S.W. 1, 2nd October, 1951 CABINET
MAN-POWER: MEASURES TO DEAL WITH LABOUR SUPPLY
MEMORANDUM BY THE MINISTER OF LABOUR AND NATIONAL SERVICE
I.—Summary
The aim of this memorandum is to review briefly our man-power situation and to propose measures for allocating to defence, export, and other essential production and services the supplies of labour to be released as a result of proposals at present under consideration and from other sources.
2. The facts of the situation are—
(a) we are faced with an additional demand of between 500,000 and 600,000 workers for defence, His Majesty's Forces, and essential industries and services, and this at a time when the general pressure of demand for labour is very high;
(b) we must hope towards the end of the period for some decrease in the numbers unemployed when the re-deployment of labour is complete and we may hope for some increase in the total working population which may range between 200,000-300,000;
(c) there should also be some easement in the competitive demand from less essential manufacture when raw material shortages begin to take effect, and if public feeling is aroused some increase in voluntary movement from less essential employment to defence, export and other essential production;
(d) the incidence of the demand falls unevenly between different parts of the country and thus intensifies the difficulty of ensuring that all the resources of labour available can be concentrated to meet the essential demands;
(e) no mere arithmetical closing of the gap will solve the labour supply problem.
3. The measures already taken are not sufficient to deal with the situation and it is essential that less essential production should be cut. On the assumption that this will be done by means of production controls, I propose—
(1) the revival on a limited scale of a system of labour supply inspection to examine the use made by employers of their labour, particularly skilled workers;
(2) that approval should be given to the opening of negotiations with the British Employers' Confederation and the Trades Union Congress with a view to introducing a Regulation of Engagement Order under which the employer would have a legal obligation placed upon him not to obtain his workers otherwise than through an Employment Exchange. The main object of this Order would be to make all workers seeking employment come to the Employment Exchange where they would be informed of the important vacancies and persuasion, not compulsion, used to get them to take these vacancies. II.—The Present Position
4. Our total working population has been increasing in recent years and is now greater than at any other date in peacetime. As is shown in the table below, there are now nearly 1 million more persons in the working population compared with 1939. In addition, the numbers registered as unemployed are over 1 million less than in 1939. There are, therefore, 2 million more persons in civil employment or in the Forces compared with pre-war.
Broad Changes in Distribution of Man-power between mid-1939 and mid-1951
(Thousands)
| Increases | Decreases | |-----------|-----------| | Metals, engineering and vehicles | +900 | Distributive trades | -400 | | Public administration | +725 | Textiles and clothing | -150 | | Basic industries and services (excluding mining) | +400 | Other services | -50 | | Chemicals | +125 | Coalmining | -25 | | Other manufacturing industries (excluding textiles and clothing) | +125 | Other mining and quarrying | -25 | | Building and contracting | +50 |
Civil employment | +1,675 | Registered unemployment | -1,075 | His Majesty's Forces (including those on release leave) | +350 |
Total working population | +950 |
5. In spite of the increased numbers at work, the total of vacancies notified to Employment Exchanges which were outstanding at 1st August, was 489,000 (the highest August figure since 1947) compared with 380,000 a year ago. During the first seven months of this year, the number of outstanding vacancies increased by 142,000; in the corresponding period last year the increase was only 34,000. In the engineering industries, which are the ones most affected by rearmament, although the number of workers has increased by about 100,000 in the last twelve months, outstanding vacancies have also increased by 34,000 to a total of 105,000.
6. Outstanding First Preference vacancies\* in work identified as part of the defence programme increased from 9,700 at 20th December, 1950, to 25,800 at 1st August. 73,000 other First Preference vacancies mainly concerned with export industries and essential services, were outstanding at the latter date. In the four weeks preceding 1st August, it was only possible to fill 3,100 defence programme vacancies and 15,700 other First Preference vacancies. During the first seven months of 1951, placings in defence vacancies had doubled, but outstanding defence vacancies have nearly trebled. In the same period other First Preference placings increased only slightly, but outstanding vacancies rose by two-fifths.
7. One of the most serious labour shortages affecting the programme, particularly at present, is that of skilled engineering workers. The number of outstanding vacancies in the principal skilled engineering occupations increased from 16,000 to 36,000 in the last twelve months; 13,000 of this increase of 20,000 took place in the last six months. During the same period the comparatively small number of wholly unemployed men in these occupations fell from 4,400 at August 1950 to 3,600 at end-1950 and again to 2,000 at August 1951.
8. Over the next two years or so the number of workers engaged on the defence programme, which has increased by some 200,000 in the last twelve months, will, according to estimates made by the Ministry of Supply, need to be further increased by something between 400,000 and 500,000; of this increase, about 120,000 will be required between mid-1951 and March 1952, and a further 280,000 by March 1953. In addition, an increase of some 75,000 is required in the strength of His Majesty's Forces during the next two years. So far as exports are concerned
- First Preference vacancies are those identified as being connected with work which is of the highest national importance, i.e., certain named industries and services, e.g., agriculture, coalmining, cotton-spinning, iron and steel, electrical generating plant, railway operating service and vacancies on defence or export work. the problem is mainly one of maintaining existing labour forces, but any substantial increase in exports in any industry might change that situation. There are in addition the outstanding demands for basic industries and services such as coal mines and transport. These are smaller in numbers but they are both difficult to fill and as their description indicates of basic importance to the whole defence and export programme. The demand for additional workers may, therefore, be in the region of 500,000; this includes a proportion, which cannot be estimated, of workers who will not be required to move from one factory to another, since their switch to defence production will take place inside the works.
9. On the other side of the balance sheet we have to consider the following possible sources of labour supply—
(a) a reduction in unemployment, (b) any further increase in the total working population, and (c) any diminution of demand in or movement of labour from other industries and services otherwise than as a result of proposals to cut down less essential production.
10. First, the level of unemployment in the two months of July and August was lower than at any time since 1945, and it is unlikely that the level of unemployment at mid-1953 will fall much, if at all, below 150,000 compared with the figure of 186,000 in July 1951.
11. Second, so far as the total working population is concerned, there has been an average increase of 140,000 per year over the past three years. This consists mainly of persons postponing retirement, pensioners returning to work and married women not normally working. It would be unwise to count on a continuing increase in the total working population at the rate of the last two or three years.
12. The third question is the possibility of a diminution of current demand and a movement of labour from less essential industries and services resulting from causes other than specific production cuts. The main cause for these would be the expected but long delayed effects of raw material shortages and of the end-use controls already put into operation. There may also be some increased voluntary movement towards important work on the part of individual workers if the public is given a strong enough lead and sense of urgency. A climate of opinion of this kind would assist the work of my Local Offices in influencing the choice of workers who would, under the proposals contained in Part IV, be required to come to the Exchanges in the course of normal turnover in order to obtain fresh employment though it is unlikely to influence their choice unless the conditions of employment of the work in question also compare reasonably well.
13. An examination of national figures only is misleading because demand and supply vary in intensity in different parts of the country. It is accordingly necessary to examine the incidence of the defence programme as between the different Regions in order to obtain a full appreciation of the nature and magnitude of the labour problems involved.
14. In the first place, unemployment is still spread unevenly over the country. Although the rate for Great Britain is 1·0 per cent., it varies between Regions from 0·3 per cent. in the North Midland Regions to 2·1 and 2·3 per cent. in Scotland and Wales, and there are some districts which still have fair-sized pockets of unemployment, e.g., the Development Areas at Clydeside (2·6 per cent.), South Wales and Monmouthshire (2·6 per cent.), Merseyside (2·4 per cent.) and Tyneside (2·2 per cent.). On the other hand, some places, such as Leicester, Derby, Huddersfield, Gloucester, Birmingham and district, Bradford and Coventry, have unemployment rates of less than ½ per cent.
15. Complete information is not available about the additional labour demands which the defence programme will make in the different Regions. Certain information has, however, been given by the Ministry of Supply concerning the engineering industries which is understood to be complete for the air programme, though not for other sectors. This information is given by Regions in the Appendix, together with the current outstanding vacancies in the engineering industries. It is given solely for the purpose of illustrating the relative distribution of the additional demands between Regions. If complete information were available it might modify some of the details, but it is not considered that the broad picture disclosed in the Appendix would be fundamentally changed. In order to measure the incidence of the additional demands they have been expressed as a percentage of the total number of employees in the engineering industries in each Region, and as a percentage of the total number of employees in other manufacturing industries. It will be seen that the Regions where, on present information, the incidence of the defence programme on the engineering industry will be heaviest are South-Western (18.4 per cent.), North-Western (14.1 per cent.), Southern (11.5 per cent.) and Scotland (10 per cent.). For all other Regions the percentage increase is less than 8 per cent. If we look at the defence demands in relation to the resources of labour employed in other manufacturing industry in the various Regions, it is clear that the same four Regions, together with Midlands, will need a higher proportionate diversion of labour than the others. The South-Western and Southern Regions stand out with 15.7 and 14.1 per cent., Midlands follows with 8.4 per cent., and the others are about 6 per cent.
16. These facts emphasise three important points. First, that the working of the production controls by which the various cuts in less essential industries and services will be put into effect must be flexible so that they can release more labour where it is urgently needed and less in areas where the labour might be frittered away, or indeed unemployed. The second point is that even where this is done to the maximum extent compatible with reasonable administration it will still leave unsolved the labour supply problems of certain areas of particularly heavy demand. Third, even with the measures proposed in the second part of this Paper we must still expect a considerable wastage of those released for defence and export work, a tendency which will be emphasised by the natural practice of employers in releasing first elderly workers and those who are least productive.
17. To summarise, therefore: —
(a) we are faced with an additional demand of between 500,000 and 600,000 workers for defence, His Majesty's Forces and essential industries and services, and this at a time when the general pressure of demand for labour is very high;
(b) we must hope towards the end of the period for some decrease in the numbers unemployed when the re-deployment of labour is complete and we may hope for some increase in the total working population which may range between 200,000-300,000;
(c) there should also be some easement in the competitive demand from less essential manufacture when raw material shortages begin to take effect and if public feeling is aroused, some increase in voluntary movement from less essential employment to defence, export and other essential production.
(d) the incidence of the demand falls unevenly between different parts of the country and thus intensifies the difficulty of ensuring that all the resources of labour available can be concentrated to meet the essential demands;
(e) no mere arithmetical closing of the gap will solve the labour supply problem.
18. I set out below the steps which I have already taken, and propose to take, to encourage labour to enter and remain in defence and export production, to discourage their entering inessential industries and services and to ensure the efficient utilisation by employers of their labour.
III.—Measures already taken
19. During the last months I have discussed on different occasions with the N.J.A.C. the steps which both sides of industry might take to assist in the effective deployment of labour for carrying out the Rearmament Programme. A number of proposals were agreed and have been sent by the Council to its constituent members, and I have written to certain N.J.I.Cs. asking them to give these recommendations careful consideration. Of these the most important are: —
(a) the practicability of some extension of overtime working as a means of increasing production;
(b) the part-time employment and training of women on semi-skilled processes;
(c) the development of schemes of upgrading and training to offset the scarcity of skilled workers. In suitable cases, it was further suggested, that the training which industry could provide itself might be supplemented in Government Training Centres (G.T.C.) on the lines which proved successful in the last war.
20. The response of industry to these recommendations has been encouraging. In many firms satisfactory schemes of upgrading and training have been introduced and, in accordance with an agreement with the engineering industry at national level, local arrangements have been made in Scotland and the Eastern Region for admitting able-bodied workers to classes in Government Training Centres providing training in some of the scarcity skilled occupations. In other Regions negotiations are continuing and I hope that before long some 1,400 engineering training places will have been taken up at G.T.Cs.
21. Suitable arrangements have also been made for dealing with labour redundancies when they arise. Employers have been asked to give Local Offices of the Ministry timely notice of the number and type of workers that they anticipate they will shortly no longer require, and workers who are about to be discharged have been encouraged to register with Local Offices before they actually become unemployed. These arrangements are designed to assist workers to pass from one job to another without an intervening period of unemployment.
22. As work on the Defence Programme builds up to its peak the scarcity of labour of the right type is going to be increasingly felt. To meet this problem the steps so far taken, including schemes for upgrading and training, are by themselves inadequate. More drastic measures are now required.
IV.—Future arrangements
23. I feel sure that the only effective way of making available the workers required, not only for the Defence Programme but also for export and essential civilian production, is the cutting down of less essential civilian production. Further, whatever production controls it may be decided to use for this purpose will, as stated above, have to be applied on a differential basis to ensure that labour is released in areas where it is wanted and to prevent workers from being discharged where suitable alternative employment is not available. On the assumption that such production controls will be introduced, there are ways in which my Department can assist.
24. Labour Supply Inspection.—I am proposing to revive, on a limited scale, a system of labour supply inspection on the lines of what was done during the war. The duties of these technical inspectors will be to visit selected firms and obtain information about the ways in which they are using their labour and, if vacancies for particular kinds of workers have been notified to Local Officers, to ascertain how far these additional workers are really needed and the extent to which the requirements could be met by the firm from its own resources. They will examine whether skilled labour is being extravagantly used or engaged on unimportant work and whether under-employment exists. Employers might then be invited to consider the recommendations made by the Inspectors and to take appropriate action to carry them out.
25. A system of Labour Supply Inspection will not, however, of itself, ensure that employers do discharge the workers they do not require. If an employer is unco-operative, it will be necessary to bring pressure to bear upon him and I have no doubt that the most effective instrument for this purpose would be to cut down his supplies. If it were known that production controls would be used, if necessary, our hands would be greatly strengthened.
26. Regulation of Engagement Order.—During and after the war various Restriction and Control of Engagement Orders made it illegal for an employer and a worker to enter upon an engagement for employment except with the permission of the Ministry of Labour. An employer, therefore, could only obtain his workers and workers could only obtain employment through an Employment Exchange. While penalties were imposed for non-compliance, the main sanction behind the Order was the use of the power of direction.
27. The only certain and fully effective method of ensuring that the labour released by cuts in production or otherwise goes where it is wanted would be by a similar Control of Engagement Order coupled with the power of direction of individuals. In present circumstances, however, the use of powers of direction is out of the question, but Regulation of Engagement Order without power of direction, and operated on the following lines, would go some distance towards solving the problem.
28. The Order would place an obligation upon an employer not to obtain his workers otherwise than through an Employment Exchange. In practice this would compel workers to obtain their jobs through an Exchange because otherwise an employer could not legally engage them. The only penalty would be that imposed on the employer. Power would be taken in the Order to exclude certain parts of the country, so that, if experience showed that the Order was not necessary in some areas, these areas could be excluded from its operation. Agriculture and coal-mining would be excluded, as would registered dock workers, merchant seamen and fishermen.
29. The main object of the Order would be to make all workers seeking employment come to the Employment Exchanges. This would enable the Exchanges to inform workers of the important vacancies and try to persuade them to take them. The Exchanges would thus be able to go a long way in preventing employers who are making an extravagant use of their labour from taking on additional workers and in ensuring that workers do not drift away into unimportant employment. The Order would also reduce substantially the amount of poaching of workers by employers that is at present going on. Experience during the war showed that an Order of this kind was the only effective method of achieving this.
30. I would make it clear from the start that there is no intention of compelling workers to accept employment which they were unwilling to take. When workers came to Exchanges to seek employment, they would be told plainly what were the most important jobs suitable for them and urged in the national interest to agree to be submitted to one or other of them. If he could not be persuaded to take one of the jobs offered to him in defence or export production, he would then be permitted to take the employment for which he asked (except in the case where we felt a firm was fully manned).
31. This method of administering the Order would enable Employment Exchanges to perform their proper functions and would encourage workers to think of an Exchange as a place where they would be told and given good advice about suitable opportunities for employment while still remaining free to choose their jobs.
32. I would therefore ask my colleagues to approve the opening of negotiations forthwith with the T.U.C. and the British Employers Confederation with a view to the introduction of a Regulation of Engagement Order on the lines set out in the preceding paragraphs.
Ministry of Labour and National Service, S.W. 1, 5th October, 1951
A. R.
### APPENDIX
**Table showing by Regions the Estimated Increases required by March 1954, in Employment in the Engineering Industries (S.I.C. Orders VI, VII, VIII and IX) expressed as Percentages of the Total Number of Employees at May 1950,**† in—
(a) the Engineering Industries, and
(b) all other Manufacturing Industries.
| Region | Outstanding vacancies at 4th July, 1951 | Additional labour requirements by March 1954\* | Total additional requirements (2) plus (3) | (4) expressed as percentage of employees in engineering industries at May 1950 | (5) expressed as percentage of employees in all other manufacturing industries at May 1950 | |-------------------------|----------------------------------------|---------------------------------------------|------------------------------------------|--------------------------------------------------------------------------------|----------------------------------------------------------------------------------| | South-Western | 5,528 | 22,695 | 28,223 | 18.4 (1) | 15.7 (1) | | North-Western | 14,472 | 50,456 | 64,928 | 14.1 (2) | 6.4 (4) | | Southern | 5,264 | 12,267 | 17,531 | 11.4 (3) | 14.1 (2) | | Scotland | 6,425 | 24,014 | 30,439 | 10.0 (4) | 6.2 (5) | | Eastern | 5,714 | 6,688 | 12,402 | 7.6 (5) | 6.0 (6) | | London and South-Eastern | 28,319 | 28,872 | 57,191 | 7.3 (6) | 5.7 (7) | | Midlands | 17,486 | 21,214 | 38,700 | 6.0 (7) | 8.4 (3) | | Wales | 1,795 | 2,773 | 4,568 | 5.3 (8) | 2.4 (9) | | North Midlands | 7,380 | 2,670 | 10,050 | 5.0 (9) | 2.4 (10) | | East and West Ridings | 7,891 | 4,347 | 12,238 | 4.3 (10) | 2.1 (11) | | Northern | 3,868 | 2,628 | 6,496 | 3.4 (11) | 2.8 (8) | | Great Britain | 104,142 | 178,624 | 282,766 | 8.2 | 5.8 |
- Figures taken from Ministry of Supply's memorandum (C.P.C. (51) 50) (excluding R.O.Fs. engaged on filling and the manufacture of explosives and a firm manufacturing respirators). It is understood that the additional labour requirements of sub-contractors and minor firms relate to the air programme only, and these figures have been divided between Regions in the same ratio as the additional numbers required by direct contractors for the manufacture of aircraft and components.
† The latest date for which a regional analysis is available. It is not considered that later figures would have any appreciable effect on the percentages shown in columns (5) and (6).
**Notes on the Interpretation of the figures**
In assessing the significance of the percentages in columns (5) and (6), some regard must be paid to the likely degree of error in the statistical information used in the calculation. The additional labour requirements given by the Ministry of Supply in C.P.C. (51) 50 are not comprehensive and do not include the additional labour required for Admiralty orders (which is not, however, expected by the Admiralty to amount to a significant total—C.P.C. (51) 54). The percentages in columns (5) and (6) may be affected by the fact that the Ministry of Supply's figures cover different proportions of the different programmes, e.g., the aircraft programme is fully covered, but only 60 per cent. of the munitions supplies programme and 50 per cent. of the radio programme are covered. This may introduce some bias into the figures since the different programmes affect the Regions in different degrees, but it may not be appreciable. A further bias may have been introduced by spreading the 70,000 additional workers required by sub-contractors and minor firms for the air programme (about 36 per cent. of additional defence requirements) in the same ratio as the regional distribution of the labour requirements of direct contractors for the manufacture of aircraft and components. It is understood that the figure of 70,000 includes an unknown number of workers who will be transferred to defence work within establishments as well as additional workers who will have to be recruited from outside. There is also probably some overlap between the figures in columns (2) and (3), which is not possible to eliminate and which is not likely to affect the Regional distribution. CABINET
TREATY OF ALLIANCE WITH LIBYA
MEMORANDUM BY THE SECRETARY OF STATE FOR FOREIGN AFFAIRS
I should like my colleagues to be aware of the most recent developments regarding the negotiation of a Treaty with Libya. It will be recalled that on 1st August the Cabinet approved the text of a 25-year Treaty of Alliance with Libya which was to be negotiated in the near future and signed when Libya became independent (C.M. (51) 57th Conclusions, Minute 6). Financial and military agreements, to run concurrently with the Treaty, were to be settled between Departments and possibly negotiated in the near future but were not to be signed until the United Nations General Assembly had completed their coming debate on Libya. Meanwhile in Libya the United Nations Commissioner's Co-ordinating Committee, comprising British, French and Libyan members, were considering the manner in which power should be transferred progressively to the Provisional Libyan Government in accordance with the United Nations Resolution of 1950.
2. The first new development was the Co-ordinating Committee's conclusion that, in order to comply with the Resolution, the United Kingdom and France would have to transfer financial responsibility to the Libyans before the declaration of independence: in fact, there should be three transfers, first of comparatively unimportant functions involving no financial expenditures; secondly, of a large group of Powers involving financial responsibility; and thirdly, of defence and foreign affairs on the declaration of independence. The consequence of this decision was that His Majesty's Government would have to conclude an interim Financial Agreement with the Provisional Libyan Government before transferring the second group of powers, i.e., in the immediate future; and a tentative draft agreement was therefore prepared by the Foreign Office and the Treasury. It is proposed to inform Parliament after signature of this Interim Agreement.
3. The second new development was the preoccupation of the Secretary of State for War concerning our security of tenure of military facilities in Libya during the interval which was bound to occur between the signature of a Treaty of Alliance, on Libyan independence, and the ratification of such a Treaty by a Libyan Parliament. In order to cover this interval it was considered desirable to prepare an Interim Military Agreement which could be negotiated at the same time as the Interim Financial Agreement and (while containing nothing likely to excite violent criticism in the United Nations Assembly) would guarantee the status quo until the conclusion of a new arrangement (i.e., a long-term Military Agreement next year.
4. This was the state of affairs when the Libyan Prime Minister, Mahmud Bey Muntasser, visited London on 10th September, and it was agreed that his unofficial comments should be sought on all five documents, viz.:—
(i) Treaty of Alliance. (ii) Interim Financial Agreement. (iii) Interim Military Agreement. (iv) Long-term Financial Agreement (very similar to the Interim Agreement). (v) Long-term Military Agreement (a highly complex document of which a tentative draft had been prepared by the interested Departments).
Mahmud Bey's suggestions have been extremely useful as a means of shortening and facilitating future negotiation and many have already been incorporated, with the agreement of the Treasury, into the latest draft of the Interim Financial Agreement, which is attached to this Memorandum as Annex I. This document was sent to the British Resident at Tripoli on 22nd September with instructions to negotiate it formally with the Provisional Libyan Government.
5. On the other document which it was proposed to negotiate immediately, the Interim Military Agreement, the Libyan Prime Minister made comments which have not proved entirely acceptable to the Service Departments and a re-draft (Annex II to this Memorandum) was sent to the British Resident in Tripoli, also on 22nd September. Unfortunately our intention to conclude this agreement simultaneously with arrangements for the transfer of intermediate powers to the Libyans has come under heavy criticism from the United Nations Commissioner and it now appears that it would be dangerous to insist on concluding an interim military agreement with the present semi-autonomous Government. The wiser course seems to be to negotiate and initial the agreement with the present Government now, but to defer signature until the day of independence, when the present Cabinet will, we anticipate, be appointed the "duly constituted Government of Libya" by the King of Libya. After current discussion of this question with the Service Departments and the Treasury it is proposed to send telegraphic instructions to the British Resident concerning negotiation of the Interim Military Agreement.
6. The Treaty of Alliance and the Long-term Financial and Military Agreements, on all of which the Libyan Prime Minister had comments to offer, must now be reconsidered by Departments and a meeting of the Former Italian Colonies Committee will shortly be called for this purpose.
7. Meanwhile arrangements are being made for the Commonwealth Governments to be suitably informed of the position. The United States and French Governments, being immediately concerned, have already been informed.
H. M.
Foreign Office, S.W. 1, 3rd October, 1951. ANNEX I
AGREEMENT BETWEEN THE GOVERNMENT OF THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND AND THE PROVISIONAL GOVERNMENT OF LIBYA REGARDING FINANCIAL ASSISTANCE TO LIBYA TO BE PROVIDED BY THE GOVERNMENT OF THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND
ARTICLE 1
Interpretation
(1) In this Agreement—
"the British Government" means the Government of the United Kingdom of Great Britain and Northern Ireland;
"the Provisional Government" means the Provisional Government of Libya;
"the Libyan Government" means the Federal Government of Libya which is to succeed the Provisional Government;
"the Provincial Administrations" means the local Governments or Administrations of Cyrenaica, Tripolitania and the Fezzan;
"the Currency Commission" means the Currency Commission the constitution, powers and duties which are provided for in the Currency Law enacted by the Provisional Government of Libya on the day of , 1951;
"the initial issue of Libyan currency" means all Libyan currency notes and coins issued by the Currency Commission against Military Administration lire notes, Egyptian currency notes and Algerian franc notes which are tendered in Libya within such period or periods from the date on which the Libyan pound becomes the standard of currency in Libya as the Currency Commission may in its discretion determine.
(2) As from the date on which the Libyan Government succeeds the Provisional Government, this Agreement shall have effect as though references to the Provisional Government were references to the Libyan Government.
ARTICLE 2
Coming into force and duration of Agreement
This Agreement shall come into force upon signature and shall continue in force until 31st March, 1953, unless previously replaced by an Agreement between the British and Libyan Governments.
ARTICLE 3
Purpose of Agreement
This Agreement is made to ensure that Libya shall enjoy conditions of financial stability and orderly economic development.
ARTICLE 4
Obligations of the British Government
In order to carry out the purpose set out in Article 3 of this Agreement, the British Government will, provided Libyan financial affairs are being conducted in a manner appropriate for the achievement of that purpose and provided that the British Government is informed fully of Libya's needs, give financial assistance to Libya as follows:—
(a) The British Government will contribute during the financial year beginning on 1st April, 1952, to the Development and Stabilisation Agency which is to be established under Libyan Law, and may contribute during the financial year beginning on 1st April, 1952, to the Finance Agency which is to be so established, sums not exceeding £500,000 sterling in the aggregate for the purposes for which those Agencies are to be established. (b) The British Government will provide one hundred per centum sterling backing for the initial issue of Libyan currency in accordance with arrangements acceptable to the British and Provisional Governments.
(c) Until 31st March, 1952, the British Government will continue to give financial assistance to the Governments or Administrations of Cyrenaica and Tripolitania, it being the intention that the Provincial Administrations will, out of their general revenues, finance the Provisional Government in order to enable the Provisional Government to exercise the powers progressively transferred to it.
(d) As regards the financial year beginning on 1st April, 1952, if, without prejudice to the undoubted right of Libya to determine its own Budgets, there is agreement between the British and Provisional Governments that the Budgets of the Provisional Government and the Provincial Administrations for that year have been framed prudently, economically and with regard to the purpose set out in Article 3 of this Agreement, the British Government will make a contribution to the Provisional Government of a sum equal to any deficiency in the combined Budgets. In the event that agreement is not reached, the British Government will nevertheless make a contribution to the Provisional Government of any sum essential to support the Libyan economy.
ARTICLE 5
Obligations of the Provisional Government
In order further to carry out the purpose set out in Article 3 of this Agreement, the Provisional Government agrees that there shall be a Chief Financial and Economic Officer and an Auditor General, who shall be officers of the Provisional Government and subject to the Civil Service Laws of Libya. All matters relating to their appointments shall be the subject of consultation between the British and Provisional Governments.
ARTICLE 6
Duties of the Chief Financial and Economic Officer and Auditor-General
(a) The Chief Financial and Economic Officer shall have access to the Prime Minister and the Minister of Finance of the Provisional Government. He shall be the principal financial and economic officer of that Government.
(b) The Auditor-General shall be the principal auditor of the Provisional Government.
(Secret)
DRAFT LETTER FROM THE BRITISH RESIDENT, TRIPOLITANIA, TO THE PRIME MINISTER OF THE PROVISIONAL LIBYAN GOVERNMENT
To be handed to the latter when the Financial Agreement is signed
Your Excellency,
I have the honour to transmit to Your Excellency a Minute of the negotiations which preceded the Financial Agreement, signed to-day between our two Governments, and to enquire whether you agree that the Minute correctly records the proceedings.
I avail myself, &c.
(Secret)
DRAFT REPLY FROM THE PRIME MINISTER OF THE PROVISIONAL LIBYAN GOVERNMENT
Your Excellency,
I have the honour to acknowledge the receipt of your letter of to-day, which reads as follows:—
(set out the letter and enclosed Minute)
I confirm that the Minute correctly records the proceedings.
I avail myself, &c. NEGOTIATIONS BETWEEN THE BRITISH GOVERNMENT AND THE PROVISIONAL GOVERNMENT OF LIBYA REGARDING THE FINANCIAL AGREEMENT OF 1951
In the course of discussions the British Delegation drew attention to the opening words of Article 4 of the Agreement which require that Libyan financial affairs shall be conducted in a manner appropriate for the achievement of the purpose set out in Article 3 of the Agreement and that the British Government shall be fully informed of Libya's needs and explained the reason for this provision. The Delegation said that the forms of financial assistance which the British Government proposed to give to Libya, while agreed by the two Governments to be those most likely to bring the greatest benefit to Libya, made it essential that the financial arrangements in Libya should be such as to ensure the effectiveness of the assistance. The Delegation regarded it as implicit in the opening words of Article 4 that the British Government should be satisfied regarding these arrangements and felt that it would be of assistance to Libya if they indicated the arrangements which, in the view of the British Government, were necessary for this purpose. The Delegation said these arrangements were that Libya should ensure that—
The Development and Stabilisation Agency and the Finance Agency
(a) no variation of the constitution, powers and duties of the Development and Stabilisation Agency and the Finance Agency is made without prior consultation with the British Government;
Currency
(b) the Libyan currency is always maintained with one hundred per cent. backing in foreign currencies, of which at least seventy-five per cent. shall be sterling;
Currency Commission
(c) no variation of the constitution, powers and duties of the Currency Commission is made without prior consultation with the British Government;
(d) the holders of the offices of Chief Financial and Economic Officer and Auditor General are persons acceptable both to the British Government and to the Provisional Government;
(e) all questions for the decision of the Provisional Government which have financial or economic implications and all draft laws and subsidiary legislation of the Provisional Government which have financial or economic implications are considered by the Chief Financial and Economic Officer and that he is given full opportunity of advising thereon before the decision is made or the legislation is enacted;
(f) the Chief Financial and Economic Officer is permitted to make to the Provisional Government recommendations relating to financial and economic matters, including recommendations for the enactment of any law or subsidiary legislation having financial or economic implications;
Auditors of the Provincial Administrations
(g) the Heads of the Audit Departments of the Provincial Administrations are under the direction of the Auditor General of the Provisional Government;
Budgets
(h) the Budgets of the Provisional Government and Provincial Administrations for the financial year commencing on 1st April, 1952, are reviewed by a Budget Committee composed of the Finance Minister of the Provisional Government and the principal financial representatives of the Provincial Administrations which should examine the Budgets in draft in the light of the purpose set out in Article 3 of the Agreement and prepare a consolidated statement of the Budgets and of the Budgets of the Development and Stabilisation Agency and the Finance Agency; (ii) the consolidated statement above referred to is made available to the British Government before 31st October, 1951. There should be consultation between the British and Provisional Governments, as required, including consultation, prior to the determination of the amount to be contributed by the British Government under paragraph (d) of Article 4 of the Agreement, regarding the incurring of any major expenditure or obligations in connection with projects not provided for in the previous Budgets;
Languages
(i) all accounts and documents relevant to the implementation of the Agreement shall be in English and Arabic, each version being equally authoritative;
Sterling Area
(j) Libya becomes a member of the Sterling Area in accordance with the terms of letters to be exchanged between representatives of the British and Provisional Governments, drafts of which have been initialled by the principal British and Libyan delegates in the course of the negotiations.
2. As regards the Development and Stabilisation Agency and the Finance Agency, the British Delegation explained that the constitution, powers and duties of the Agencies had been carefully considered at the meeting of Experts on Libyan Financial, Economic and Development Problems and had been accepted by the Provisional Government. The Delegation said that the British Government felt that it could not be satisfied that Libya was conducting its financial affairs in an appropriate manner unless the constitutions, powers and duties of the Agencies were retained substantially as the Provisional Government had approved them.
3. As regards the question of Libyan currency, the British Delegation said that, for reasons which had been explained fully at the meeting of Experts on Libyan Financial, Economic and Development Problems, the Currency Commission system was the only currency system appropriate for ensuring that Libya would enjoy conditions of financial stability and orderly economic development, since in no other way could a stable currency be provided so simply, inexpensively and quickly. The Delegation said that the Currency Commission system postulated that Libya should be a member of the Sterling Area. The Delegation added that, in these circumstances, the British Government felt that it could not be satisfied that Libya was conducting its financial affairs in an appropriate manner if she did not comply with paragraph (b) above, retain the Currency Law substantially on the lines along which the Provisional Government had approved it and remain a member of the Sterling Area.
4. The British Delegation also referred to the concluding sentence of Article 4 (d) of the Agreement and explained that, in the event that the Libyan Budgets were not agreed, the British Government would still wish to make a contribution of any sum essential to support the Libyan economy but would be compelled itself to assess that sum.
5. The principal delegate of the Libyan Provisional Government stated that the Provisional Government proposed the enactment of laws which would include provisions for ensuring that:
(a) Consolidated Fund-Credits.—All income (including the proceeds of taxes, duties and other imposts and all grants or loans received) of the Provisional Government and of the Provincial Administrations is paid into the Consolidated Fund concerned;
(b) Consolidated Fund-Debits.—Only expenditure sanctioned by legislation is paid out of the Consolidated Fund concerned;
(c) Consolidated Fund-Withdrawals.—No sum is withdrawn from the said Consolidated Fund except under the authority of a warrant countersigned by the Auditor General in the case of the Provisional Government or the Head of the Audit Department in the case of the Provincial Administrations, every warrant to be so countersigned if the officer concerned is satisfied that it has been issued and is in accordance with constitutional requirements and the provisions of paragraph (b) above, but not otherwise; (d) Audit.—The accounts of all Departments of the Provisional Government and of the Provincial Administrations are audited by the Auditor General in the case of the Provisional Government and the Head of the Audit Department in the case of the Provincial Administrations and are rendered as required by those officers; and that those officers and their deputies at all times have access to all books, records, returns and other documents relevant to such accounts and report to the Government or Administration concerned on the exercise of their functions. The British Delegation took note of the statement that the Provisional Government proposed the enactment of such laws, which they regarded as essential to the orderly conduct of Libyan financial affairs.
(Secret)
DRAFT LETTER FROM THE BRITISH RESIDENT, TRIPOLITANIA TO THE PRIME MINISTER OF THE PROVISIONAL LIBYAN GOVERNMENT
I have the honour to refer to the request that Libya should become a member of the Sterling Area, which was made by the Minister of Finance in the Provisional Libyan Government at the Fourth Session of the Meeting of Experts on Libyan Financial, Economic and Development Problems, and have pleasure in informing Your Excellency that arrangements are being made so that Libya will become a member of the Sterling Area with effect from 1951, the date on which the control of Libya's finances is handed over to the Provisional Libyan Government. These arrangements will hold good when the Libyan Government takes over from the Provisional Libyan Government.
2. So long as Libya remains a member of the Sterling Area, she will be able to trade automatically in sterling throughout the Sterling Area. She will also be able to trade freely with other countries and to draw automatically upon the Central Reserves of the Sterling Area to meet such commitments as she may have in currencies other than sterling, including commitments in United States and Canadian dollars. The extent to which Libya can make drawings in United States and Canadian dollars will not be limited to her net earnings of these currencies.
3. For her part, Libya will, so long as she remains a member of the Sterling Area, be expected, in common with all other Sterling Area members,—
(a) to maintain an exchange control system on normal Sterling Area lines; (b) to pay into the Central Reserves of the Sterling Area all United States and Canadian dollars that she may earn beyond necessary working balances of banks; (c) to confine her drawings of currencies, other than sterling, to what she considers to be reasonable to meet her requirements and, whenever stringency exists in United States and Canadian dollars, to limit her drawings in these currencies to what is required in order to meet her essential needs.
4. I avail myself, &c.
(Secret)
DRAFT REPLY FROM THE LIBYAN PRIME MINISTER
I have the honour to acknowledge the receipt of Your Excellency's letter of to-day, in which you informed me as follows:—
ANNEX II
NOTE FROM THE LIBYAN PRIME MINISTER TO THE BRITISH RESIDENT, TRIPOLI
(Draft of 22nd September)
Your Excellency,
In view of the delay which must necessarily occur before it will be possible to conclude the Treaty of Friendship and Alliance into which our two Governments earnestly wish to enter, and in view of my Government's desire that interim provision should be made for our mutual defence, I have the honour to propose that the facilities which your Government at present in fact enjoy for stationing British armed forces in Libya, including privileges and immunities in that connection, shall continue pending agreement between our two Governments on any new or different arrangements.
The facilities in question shall include an option on the sites which the Cyrenaican Government have been asked by the British Government to make available, and the right if the option is exercised, to use the sites in question for military purposes.
It is understood that the British Government will carry into effect its plan for accommodating British forces outside the cities, except in a limited number of cases where the nature of the duties of the British armed forces renders this course impracticable. The British Government will use its best endeavours to complete the execution of the plan as quickly as the physical difficulties can be overcome.
If the British Government accept this proposal, it is suggested that this note and Your Excellency's reply to it in that sense should be regarded as constituting an Agreement between our two Governments.
(Draft)
REPLY FROM THE BRITISH RESIDENT, TRIPOLI, TO THE LIBYAN PRIME MINISTER
I have the honour to acknowledge Your Excellency's letter of the day 1951, as follows:
(Quote text of letter)
I am to inform Your Excellency that His Majesty's Government welcome the proposal contained in Your Excellency's letter and agree that this exchange of letters between us shall be regarded as constituting an Agreement between our two Governments. CONTINUANCE OF THE FESTIVAL PLEASURE GARDENS
MEMORANDUM BY THE LORD PRIVY SEAL
The Festival Pleasure Gardens first came to the notice of the Government late in 1948 as a project in which the London County Council were keenly interested for providing a permanent recreation and amusement centre in London on the general lines of the Tivoli in Copenhagen. During the detailed examination of the scheme the L.C.C. elections in the spring of 1949 resulted in a political deadlock in London government. The attitude of the London County Council became much more reserved, and although a five-year run was recommended in order to try out the project and to spread over a reasonable period the capital expenditure involved, the London local authorities were not prepared to commit themselves to anything beyond a scheme for the period of the Festival. This uncomfortable compromise was adopted. My colleagues will be familiar with the troubles which then ensued—further delays and increased costs resulting from the devaluation of sterling, the failure to obtain a satisfactory management for the one-year scheme, the labour disputes, the unfortunate choice of the main contractor, the appalling weather and the completion of the work more than a month late at a greatly enhanced cost.
2. Although the summer of 1951 has not been particularly fine the experience since opening the Gardens has by contrast been most encouraging and has given solid confirmation that a great popular demand exists for such facilities in London, and that the promoters of the Gardens have been singularly skilful in gauging and in catering for this demand from a broad cross-section of the public.
3. Attendances up to 27th September have been 7,167,200 and they promise to exceed not only the original estimate of 6 million over the longer season, but the recently revised total of 7½ million. On the basis of actual operation and of a detailed financial review by the Chairman, Sir Charles King, it has been estimated that the total gross income for the whole season will be £1,153,000, and the total expenses, after allowing for contingencies, will be about £500,000, giving a gross operating profit of £653,000 to set against the net capital expenditure of £1,853,000 assuming satisfaction in full of all disputed claims, and of liabilities for winding up and reinstatement, which allows for salvage amounting to £89,000.
4. The reconstituted Board have also, at my request, furnished me with estimates of expenditure and revenue on the assumption that they were invited and empowered to continue operation of the Gardens for a further period, which has been taken for the purpose of their calculation as two years. These would, without very substantial alteration, apply to, say, five years, which would be a more reasonable period to take, with the qualification that more capital works would be needed, but amortisation would be spread over a longer period. The Board estimate that maintenance and operating costs in future years would be about £400,000 per annum, assuming opening hours from 10.30 a.m. to 11.30 p.m., or about £365,000 per annum with reduced hours from, say, 2.30 p.m. to 10.30 p.m. to cut out double shifts. "Capital" expenditure totalling £150,000 would be needed over the second and third years, but a large part of this (at least one-third) would in terms of works consist of maintenance and something under 10 per cent. of sanitation. Very little of it would be new construction or extensions of buildings. There are obvious difficulties in estimating the post-Festival revenue, but the Board consider that one-half of this year's revenue, say, £580,000, would be a "safe" figure, that two-thirds, or £775,000, would be an "optimistic" figure, and that a repetition of this year's revenue would be "most optimistic." They therefore conclude that on a conservative estimate an extension for two years would not lose money and may result in an operational profit (£212,000), while on the higher figures it is by no means impossible to achieve a surplus of over £600,000, by obtaining a revenue of £1,550,000 against an expenditure of £880,000–£950,000.
5. My own view is that, given average weather and continued energetic management, the Gardens have great revenue-earning possibilities even after the Festival, and ought, if continued for five years, to be able to repay a substantial part at any rate of the loan indebtedness of some £1,172,000 which seems likely to be outstanding at the end of this season. This assumes the Company repays £250,000 (see paragraph 11) and that £200,000 working capital is left with the Company for continued operations after this season's liabilities have been met. This working capital will be produced by retention of existing revenue and hence deferment of repayment of loans. (The total amount actually lent to the Company at present is £1,432,000. Actual expenditure on capital and current account combined at the end of the first season looks like working out at about £2,353,000, i.e., £1,853,000 plus £500,000. The loss—i.e., the net deficit—at the end of the first season will be about £1,200,000.)
6. This and the following paragraphs deal with other general considerations which arise.
Public Demand
I am convinced that public opinion generally supports the continuation of the Pleasure Gardens for a further period of years, and that if they were terminated a strong demand for some new permanent facilities of this kind would immediately arise. The London County Council appear to share this view and they have by a majority passed a resolution on 31st July definitely committing themselves that if as a result of detailed examination "a continuation should be decided upon the Council would not raise objection to enabling legislation to permit an extension of not more than five years, but . . . that there should be an experimental period of two years after the conclusion of the Festival before any decision is taken for or against a permanent continuance and that the consent of the Council should be required to any extension beyond two years."
Tourist Aspects
7. The tourist attractions of the Gardens are particularly important in view of the worsening of the balance of payments and the success achieved this season in breaking all previous records (tourist traffic for the first eight months of 1951 is estimated at 315,000 or 14 per cent. higher than for the same period last year, and August tourist traffic was 21 per cent. above last year and 68 per cent. more than the pre-war average). According to recent checks over three complete days 70–80 per cent. of the Festival Gardens visitors have proved to be Londoners; 18–25 per cent. provincials and 1½–5 per cent. overseas visitors, the lower figure for overseas visitors being after the middle of September when the tourist season was ending. A very rough comparison with tourist figures indicates that the Gardens have been attracting the equivalent of one visit from something like one-third of the tourists arriving in this country, despite the strong competition of the South Bank, which is now ended. There seems little doubt that continuance of the Gardens would be a substantial competitive factor in attracting tourists, and the British Travel and Holidays Association have gone on record to this effect.
Economic Aspects
8. On grounds of saving man-power, as well as costs of operation, there may be something to be said for limiting opening hours of the Gardens in the next two or three years so that not more than one shift of staff is required for them, as proposed in paragraph 4. It is impossible to estimate how far public spending at the Gardens hits other enterprises, but there is no reason to believe that the net effect is harmful. Some of it is no doubt at the expense of various forms of racing and gambling; while some of it probably diverts money from cinemas in which there is a considerable dollar spending element, and some of it encourages Londoners to amuse themselves in London instead of travelling to resorts, where they would create consequential demands for vehicles, oil and road maintenance. Continuance of the Gardens would itself require appreciable man-power and materials, but on balance it seems reasonable to assume that even in present economic conditions large attendances at the Festival Gardens are an advantage rather than a burden on the national economy.
Competition with other Enterprises
9. Nevertheless, there is no doubt that amusement and other industries will tend to blame any worsening of their position on the Festival Gardens and will eye narrowly any competitive privileges. It seems fair that if the Gardens are decided by Parliament and the London County Council to represent the best way of using this part of Battersea Park for the amenity and recreation of the public no rent should be payable. The Gardens enjoy no privileges as regards entertainment tax. The Central Land Board see no objection to continuing the present exemption from payment of development charge during such period as the Gardens remain open, on the basis of legislation expiring within five years. There can be no question that the Company should pay profits tax and income tax if it should eventually make a profit, but the question of the basis to be taken for depreciation and the point at which profit earning should be regarded as beginning requires considerable discussion with the Inland Revenue. Finally, I understand that the Board assume that in future years they will be liable to pay rates and have made provision accordingly.
Relation to Investment Programme
10. Another source of possible embarrassment is the question of the application to the Pleasure Gardens of the Chancellor of the Exchequer's ban on investment expenditure for entertainment purposes in excess of £5,000. The Board's present estimate for "capital" expenditure in the next two years totals £150,000, but a good deal of this relates to gardening operations, dismantling, storing, re-erection and replacement of tentage, expenditure on vehicles, dismantling structures no longer required, fencing, clothing and expenditure on catering establishments, which do not come under the ban. It also remains to be established whether, according to existing practice, the Gardens rank for investment expenditure purposes as one enterprise, or as a series of different restaurants, theatres, amusement rides, &c., sharing a single large site like the factories on a Government trading estate. These matters are being examined in detail, but it is clear that in the event of a decision to continue the Gardens Parliament must be told exactly what the position is, and that the passage of legislation must be accepted as specifically empowering the giving of permission for the minimum work necessary for the Gardens to open in 1952 and 1953, even if some dispensation from the ban is involved. As the Economic Secretary to the Treasury told the House on 17th July: (Hansard, Cols. 1059-60)
"... the ban applies to Government-sponsored projects as well as to others. ... If it is thought advisable that the Festival Gardens should continue that matter would, of course, come before the House as legislation would be involved, and it would be for the House to decide."
Finance
11. As I have already stated in the House on 24th July (Hansard, Col. 1871) "Assurances that no fresh capital will be needed and that there will be substantial repayments in reduction of the Exchequer loans already made are essential conditions for Government agreement," and I am satisfied that these conditions can be met. I understand that I shall shortly be receiving from the Company a formal offer to repay £250,000 from this year's working, and this will leave them with sufficient working capital to carry on and to get the Gardens into shape for next season, provided that they are able to settle the contractor's claims in accordance with their estimates. (If the estimated final payment to the contractor should be exceeded a corresponding amount of the £250,000 would have to be deducted or refunded to them.) Assuming the full £250,000 is repaid on this season's working, the position agreed between the Government and the L.C.C. about future repayments, as and when they become possible, is:
(i) the Exchequer will get a further £20,000, i.e., the balance of the first £270,000 repayment; (ii) of the next £500,000 the Exchequer will get £300,000 and the L.C.C. £200,000; (iii) the Exchequer will get the next £662,000.
The L.C.C. have, however, received a guarantee that their total ultimate loss shall not exceed £40,000; their Resolution of 31st July mentioned above, reiterated the importance they attach to this guarantee, and there would seem to be no possibility whatever of persuading them to abandon it. This means that if the total repayments by the end of 1953 had not reached £670,000 and it was decided at that stage not to continue the Gardens, the Exchequer would have to refund to the L.C.C. a sufficient amount to bring the total repayment to them up to £160,000 (the £200,000 originally lent by them less the £40,000 they are prepared to lose). If, for example, £250,000 were repaid on this year’s working, and a further £250,000 by the end of 1953, the L.C.C. would receive only £100,000 from the Company and would have to get £60,000 from the Exchequer, which would mean that the net total return to the Exchequer would be £340,000 on the three years.
12. I propose, and I understand that the L.C.C. would agree, that the existing Festival Gardens Company should continue to operate the Gardens, and that in giving effect to any changes of personnel the Government should retain a majority on the Board of Directors as long as there is a large liability for loan repayment to the Treasury. It is of the utmost importance that the Gardens should continue under a similar type of management to the present one.
Observance of Standards
13. The general standards embodied in the Festival Pleasure Gardens at present are in general (subject to the usual chronic inadequacies of the catering industry) reasonably satisfactory and acceptable to all shades of opinion. Vigilance will be necessary to ensure, if the Gardens are to continue, that there is no let-down of standards of any sort, and I would propose, with the support of the London County Council, that a strong directive should be given to this effect.
Legislation
14. Existing legislation authorising the Festival Gardens is contained in the Festival of Britain (Supplementary Provisions) Act, 1949, and the Festival of Britain (Sunday Opening) Act, 1951. Continuance will require amendment of the 1949 Act to suspend section 3 dealing with dismantling and reinstatement for five years (or for two years if the Government and the L.C.C. so decide); to repeal sections 8 and 9 dealing with grants for landing stages, and possibly section 4 dealing with action for nuisance; to perpetuate the Festival of Britain (Sunday Opening) Act, 1951, in so far as it applies to the Festival Pleasure Gardens, and to include certain guarantees, e.g., of free public access to appropriate sections such as the riverside walks for periods when the Gardens are not in operation and when maintenance work permits. Parliament has already had something close to a Second Reading debate on the subject (Hansard, Cols. 1014-1088—25th June, 1951).
15. The L.C.C. in their resolution of 31st July, 1951, also stipulated that in the course of detailed examination the possibilities should be explored of—
(1) provision in the royal parks of games facilities which could otherwise be provided in the Pleasure Gardens area; (2) reduction in the price of admission in future years; and (3) remission of admission charge for old age pensioners.
I am taking these points up with Festival Gardens Limited, and in the case of (1) with the Ministry of Works, but I am not optimistic about being able to meet any of them, and I gather that the L.C.C. may not press them very hard.
16. I am quite clear as a result of full examination that—
(a) the public want the Pleasure Gardens to continue; (b) continuance is in the interest of the taxpayer and of the national economy; (c) such practical difficulties as there are can be overcome provided an early decision is reached.
17. I am sorry to trouble my colleagues with the matter at this awkward stage, but I am compelled to do so as the Festival of Britain (Supplementary Provisions) Act, 1949, requires the Minister of Health (now Local Government and Planning) to make an order fixing an "appointed day" six months after the date on which the Gardens were first opened to the public, and binds the Company as soon as may be after the appointed day to proceed with reinstatement of the Park. As the Fun Fair was opened on 11th May and the Gardens as a whole on 28th May there is some doubt whether the appointed day ought to be 11th November or 28th November, but it would be undesirable to delay beyond 12th November, and if the Gardens are to continue a Bill must be ready for introduction immediately the new Parliament meets, and the London County Council and the Company must be given definite guidance about holding the position open until a firm decision can be taken at the beginning of November.
18. In view of the General Election I think my right course at this stage is to confine myself to seeking the authority of the Cabinet to:
(1) inform the L.C.C. and the public that the detailed examination promised has been carried out and has led the Government to the view that continuance is practicable and desirable, and that legislation ought to be introduced accordingly to enable the Festival Pleasure Gardens to be continued for a period of up to five years, subject to cessation at the end of two years if the Government or the L.C.C. so desire;
(2) arrange for Parliamentary Counsel to have Bill ready for introduction at the beginning of the next Parliament if Ministers at the time so decide;
(3) instruct the Board of Festival Gardens Limited and the Festival Office that pending a firm decision when the new Parliament meets they should take such steps as are essential (not involving any expenditure beyond their already available means or forward commitments) to make it possible to reopen the Gardens next year if continuance should be decided upon.
R. R. S.
Office of the Lord Privy Seal, S.W. 1, 3rd October, 1951. Planning) to make an order fixing an "appointed day" six months after the date on which the Gardens were first opened to the public, and binds the Company as soon as may be after the appointed day to proceed with reinstatement of the Park. As the Fun Fair was opened on 11th May and the Gardens as a whole on 28th May there is some doubt whether the appointed day ought to be 11th November or 28th November, but it would be undesirable to delay beyond 12th November, and if the Gardens are to continue a Bill must be ready for introduction immediately the new Parliament meets, and the London County Council and the Company must be given definite guidance about holding the position open until a firm decision can be taken at the beginning of November.
18. In view of the General Election I think my right course at this stage is to confine myself to seeking the authority of the Cabinet to:
(1) inform the L.C.C. and the public that the detailed examination promised has been carried out and has led the Government to the view that continuance is practicable and desirable, and that legislation ought to be introduced accordingly to enable the Festival Pleasure Gardens to be continued for a period of up to five years, subject to cessation at the end of two years if the Government or the L.C.C. so desire;
(2) arrange for Parliamentary Counsel to have Bill ready for introduction at the beginning of the next Parliament if Ministers at the time so decide;
(3) instruct the Board of Festival Gardens Limited and the Festival Office that pending a firm decision when the new Parliament meets they should take such steps as are essential (not involving any expenditure beyond their already available means or forward commitments) to make it possible to reopen the Gardens next year if continuance should be decided upon.
R. R. S.
Office of the Lord Privy Seal, S.W. 1, 3rd October, 1951. CABINET
CLOSER ASSOCIATION IN CENTRAL AFRICA
MEMORANDUM BY THE SECRETARY OF STATE FOR THE COLONIES AND THE SECRETARY OF STATE FOR COMMONWEALTH RELATIONS
We circulate herewith for the information of our colleagues the final communique issued on 21st September by the Conference on the Closer Association of the Central African Territories which we attended at the Victoria Falls with representatives of the three territories. No immediate decisions are required on the conclusions of this conference; but early decisions will be needed after the General Election and we wish to place our views on record. Our main recommendations are that—
(1) as soon as possible after the General Election His Majesty's Government should publicly endorse the conclusions of the Victoria Falls Conference, including the proposal to resume the conference in London about the middle of 1952;
(2) at the same time His Majesty's Government should state publicly that it would favour in principle a scheme of federation between the three territories on the general lines recommended by the London Conference of officials, and considers that such a scheme is in the best interests of the Africans as well as of the other inhabitants of the territories; that it recognises that African opinion in the two northern territories has declared itself as opposed to these proposals; but that, in the light of the assurances agreed upon at the Victoria Falls Conference and of the economic and other advantages of closer association, it trusts that Africans will be prepared to give further and favourable consideration to the proposals; His Majesty's Government should also endorse the statement in paragraph 11 (i) of the Victoria Falls Conference communique that any consideration now or in the future of amalgamation of the three territories is excluded unless the majority of the inhabitants of all three territories desire it, and should make it clear that a similar principle would apply equally to amalgamation of two of the territories or any part thereof;
(3) we should regard the federation of the three Central African territories as an essential measure for preventing non-British influences from the Union of South Africa from encroaching on and eventually engulfing British Central Africa. In our public statement we should endorse the agreed declarations of the Victoria Falls Conference that the British connection and British traditions and principles in the Central African territories should be so strengthened as to ensure that they continue to prevail.
Background of our visit to Central Africa
2. In our memorandum of 3rd May we submitted to our colleagues the report of the London Conference of officials, which recommended that closer association between the three territories ought to be brought about urgently and that this should be done not by amalgamation of the territories but on a federal basis. On 31st May our colleagues approved our proposals that the report should be published and that His Majesty's Government, without being committed to acceptance of the proposals, should commend them in general terms for the careful consideration of all the peoples concerned as embodying a constructive approach. The report was duly published and a statement to this effect made on 13th June when our intention to visit the Central African territories during the summer recess was also announced. Since then public discussion of the proposals has been proceeding in the three territories.
Our visit to Central Africa
3. We duly visited Central Africa during August and September. The Secretary of State for the Colonies left London on 24th August and spent eight days in Nyasaland and twelve days in Northern Rhodesia before proceeding to the Victoria Falls. In Nyasaland he held discussions with the Acting Governor and his Executive Council; with members of the Legislative Council, European, African and Indian; with representative European bodies, both commercial and agricultural; with certain missionaries; with representatives of the Indian and Coloured communities; with the three African Provincial Councils and the African Protectorate Council, which are the recognised bodies for the expression of African opinion; and with the Nyasaland African Congress, which corresponds to a political party. In Northern Rhodesia the Secretary of State held discussions with the Governor and his Executive Council; with the members of the Legislative Council, European and African; with representative European bodies, commercial, agricultural, municipal and trade union; with representatives of the Indian and Coloured communities; with the Barotse National Council, the African Provincial Councils in the five other provinces or representative members of them, and the African Representative Council; with the Northern Rhodesia African Congress (a body similar to the Nyasaland Congress); and with representatives of African urban councils, welfare societies and trade unions. The Secretary of State attended over eighty meetings during his tour and thus obtained a complete picture of public opinion on the proposals in Northern Rhodesia and Nyasaland.
4. The opinions which were expressed to him may be summarised as follows:
(a) European, Indian and Coloured Opinion
European opinion in Northern Rhodesia and Nyasaland is generally favourable to the proposals, subject to some minor reservations on points of detail. Europeans recognise the economic advantages of federation and the need to create a strong British bloc to resist pressure from the Union of South Africa and they believe that the proposals would safeguard their own future. The European leaders in Nyasaland, in view of African opposition to the proposals, expressed the hope that if the proposals were put into effect this might be done in such a way as to carry African opinion with them, indeed they would regard a measure of African support for the proposals as a necessary basis for their own agreement that the proposals should be carried into effect.
Indian and Coloured opinion is at present generally suspending judgment on the proposals. Indian and Coloured people recognise the economic advantages of the proposals but, before they make up their minds finally, wish to see how any detailed scheme would affect their own interests and future in Central Africa.
(b) African Opinion
African opinion in Northern Rhodesia and Nyasaland, as expressed to the Secretary of State for the Colonies during his visit, was almost unanimously opposed to the proposals. This opposition has been organised by the two African Congresses, bodies which are mainly although not entirely composed of the comparatively small educated elements in the two territories. In Northern Rhodesia the Congress has been influenced and assisted by a local European resident known to be a Communist. In Nyasaland in particular the campaign has been much influenced and indeed largely directed from outside by Dr. Hastings Banda, a Nyasaland doctor in London, who is rigidly opposed to federation and issued a pamphlet against it directed not against the report of the London Conference of officials but against the earlier proposals for federation produced in 1949 by the unofficial conference at the Victoria Falls; this pamphlet, although published after the London Conference, was written before it. The administrative staff in Northern Rhodesia and Nyasaland, although they have very fully explained the proposals to the African population over a period of weeks, have been bound, because His Majesty's Government is not yet committed to them, to refrain from any attempts at persuasion. This position has been scrupulously observed, with the result that the two Congresses have had the field open to them for three months. Although the organised campaign by the Congresses has powerfully influenced the course of events, it would be a grave mistake to regard the opposition as representing nothing more than the views of the educated minority. The chiefs and other Africans who have considered the matter also expressed themselves as opposed to the federal scheme, partly as a result of the organised campaign against it and of their dislike of change, but largely also because of their fear of Southern Rhodesia and in Northern Rhodesia of domination by the local Europeans. It must be admitted that at the time of our visit African opposition to the scheme was both general and deeply felt. This opposition ignores the advantages of federation, both economic and political, and, as some of the more intelligent Africans admitted, is based not on the proposals in the officials' report itself, but on their fear of what might follow if federation came into being. Africans are afraid that in that event their land would be taken away, that their political advancement would be endangered, that the Protectorate status of Northern Rhodesia and Nyasaland would be abolished and that federation would before long be changed into amalgamation; many of them also confuse the two terms since the same word covers both in a number of native languages. These fears are not justified by the terms of the officials' report, which contains full safeguards for African interests, specifically reserves land and political advancement, and indeed all other services closely affecting the lives of Africans, to the Northern Rhodesia and Nyasaland (and not the federal) Governments under the general supervision of His Majesty's Government as at present, and clearly lays down that the Protectorate status of the two northern territories would be preserved under the scheme, while no change in the federal scheme could be made except by His Majesty's Government with the consent of Parliament. Reassurances to this effect were given by the Secretary of State to the Protectorate Council in Nyasaland in a formal statement which was repeated at other meetings. But by the time of the visit African opinion had hardened and the African representatives at the Victoria Falls Conference were given a definite mandate to oppose federation. Indeed, it was only with great difficulty that the Africans in Nyasaland were persuaded to be represented at the Victoria Falls at all. In Northern Rhodesia there was a favourable development just before the conference; as a result of the patient arguments of Mr. John Moffatt, unofficial representative of African interests on the Executive and Legislative Councils, the African leaders authorised their representatives to inform the conference that, while the Northern Rhodesia Africans opposed federation, they would be willing to consider the question of federation again on the basis of the officials' report after the policy of partnership between Europeans and Africans in Northern Rhodesia itself had been defined and, as so defined, put into progressive operation. This very important statement means that Africans in Northern Rhodesia are likely to be willing to consider the federation proposals more favourably if as a result of discussions to be held between their representatives and Europeans during the next few months they are satisfied that their own political future in Northern Rhodesia is secured. In Nyasaland also there are now signs of a more favourable development of opinion which is referred to in paragraph 14 below.
5. The Secretary of State for Commonwealth Relations arrived in Salisbury on 10th September. During the next few days he had talks with the Cabinet, with Opposition Leaders, and with a number of representative people. The Southern Rhodesia Government had arranged for him to have meetings at Salisbury and at Bulawayo with representative Africans, urban and rural. Some of the Africans were in favour of federation, but the preponderant opinion was against it for a variety of reasons, of which some were mutually inconsistent. The Southern Rhodesia Government appeared to be prepared to come out in favour of federation, though there were certain specific points (see paragraph 16 below) on which they expressed themselves as dissatisfied. European opinion generally seemed to be in favour of closer association, with a tendency in some cases to prefer the complete amalgamation of the Territories rather than federation. As the result of the discussions with the Commonwealth Secretary, it was hoped that the Southern Rhodesian representatives at the Conference would observe care in putting forward their suggestions for varying the London proposals and would do their best to avoid a breakdown of the Conference. The Victoria Falls Conference
6. It was made clear in the statement to Parliament on 13th June that the Victoria Falls Conference was not expected to reach decisions binding on Governments, but was regarded as a further stage in our consultation with local opinion. As a result of the differing views expressed to us in the three territories, it became evident before the Conference that we could not hope to reach agreed conclusions on the substance of the officials' report. We therefore decided to aim at preventing a breakdown of the consideration of the proposals and at securing that there should be an adjourned conference next year in London where Africans had made it plain that they would always be glad to attend discussions. We also decided to aim at securing general agreement as to the economic advantages of closer association between the three territories and at persuading the Southern Rhodesia delegation to join with us in assurances which would make it easier to carry the discussions further with Africans after the conference. All these objectives were achieved.
7. The conference was not easy to handle. The Southern Rhodesia delegation consisted not only of Sir Godfrey Huggins and three of his Ministers, but also of the leaders of the Opposition parties; they were therefore a somewhat rigid body. They were anxious to secure some tangible results at the conference which they could present to their public opinion, hesitant as much of it is, about the advantages of federation. They were irritated that African opposition to the principle of federation, based on grounds which they did not regard as reasonable, prevented the discussion at the conference of the specific recommendations in the officials' report. It was only with some difficulty and with the support of the Governors of Northern Rhodesia and Nyasaland, of Mr. Welensky and Mr. Moffatt, that we were able to keep the conference on an even keel and to bring it safely into port with satisfactory conclusions. The communiqué which was eventually agreed to was based on our own draft with minor amendments by the Central African delegations.
8. The main points in the communiqué are:
(a) There was unanimous agreement that the conference should be adjourned until next year when it would meet in London; it was also agreed that in the interval there should be discussions within each territory and exchanges of views between the four Governments.
(b) Certain assurances to African opinion were unanimously accepted and it was agreed that, if any form of closer association is eventually decided upon, all these should be enshrined as an integral part of the constitution. The most important of these assurances is that the Protectorate status of Northern Rhodesia and Nyasaland should be preserved under any federal scheme and that any consideration now or in the future of amalgamation of the three territories is excluded unless a majority of the inhabitants of all three territories desired it. This represents a very substantial concession by Sir Godfrey Huggins and his colleagues and means that federation cannot lead on to amalgamation unless a majority of the Africans accept amalgamation at some stage in the future. An absolutely watertight answer to what is undoubtedly the main objection of the Africans to the scheme is thus provided. An assurance was also agreed to that the political advancement of the peoples of Northern Rhodesia and Nyasaland must remain the responsibility of the Northern Rhodesia and Nyasaland Governments (subject to the ultimate authority of His Majesty's Government) and not of any federal authority; this provides the answer to the African fear of interference by a federal authority in their own internal political advancement. Finally it was agreed that land and land settlement questions in Northern Rhodesia and Nyasaland should remain the responsibility of the Northern Rhodesia and Nyasaland Governments and not of any federal authority.
(c) There was unanimous agreement that the policy of economic and political partnership between Europeans and Africans was the only policy under which federation could be brought about; on the need for countering the dangers which would flow from any weakening of the British connection in the three territories; and on the advantages of closer association for the common handling of problems transcending territorial problems such as communications, research, defence, higher education and the planning of economic development. We joined with the conference in declaring ourselves favourable to the principle of federation; the African representatives naturally abstained from this declaration. The conference as a whole recognised that African apprehensions are one of the main obstacles to the general acceptance of federation. The Northern Rhodesia Africans, in accordance with the decision referred to in paragraph 4 above, recorded their agreement to consider the question of federation again on the basis of the report of the London Conference after the policy of partnership in Northern Rhodesia had been defined and, as so defined, put into progressive operation.
9. The concrete conclusions of the conference were themselves of considerable importance and will in our view materially contribute to the solution of the problem. The conference had an equally important intangible value as the first occasion on which Europeans of all three Central African territories have sat down with African representatives to discuss the relations between the three territories. The African members of the conference, particularly those from Nyasaland, were generally recognised to have made an important contribution to it. All the Africans expressed their deep gratitude for the arrangements made for them at the conference and the Nyasaland Africans, who had with so much difficulty been persuaded to come, volunteered at the end to other members of their delegations that it had been well worth while. The African representatives were certainly impressed by the attention paid to their views and they cannot have failed to be impressed also by the extent to which the African attitude to the scheme dominated the discussions and the differing views expressed on this subject by the various European representatives. It is significant that Sir Godfrey Huggins had already informed us before the conference, and repeated at it, that if Africans from the two northern territories were to sit on a federal Legislature Africans from Southern Rhodesia would have to sit there also. We can regard the conference as an important precedent for the inter-racial discussion of major problems in Central Africa.
Our Conclusions and Recommendations
10. So far His Majesty's Government has not declared its attitude towards the proposals in the officials' report, but if the discussion in Central Africa of those proposals is to go forward it will be necessary for an early statement of the views of His Majesty's Government to be made. We believe, for reasons given in the following paragraphs, that this statement should be favourable to federation.
11. From the economic point of view we believe that there is an unanswerable case for federation. The economies of the Central African territories are linked by a common port at Beira for all three of them, a common railway system for the two Rhodesias, the dependence on coal from Southern Rhodesia of the copper mining industry which is the life-blood of Northern Rhodesia, the prosperity which copper mining in Northern Rhodesia brings to a number of industries in Southern Rhodesia, the many commercial connections between the three territories and, last but not least, the Zambesi and Shire River basin with its great potentialities for the development of hydro-electric power and irrigation facilities if handled on a Central African basis. The population of the three territories will double itself within twenty-five years so that a vast effort in economic development will be needed if food supplies are to be adequate and living standards are to be progressively improved. For this purpose economic planning on a Central African basis is needed so that the resources of the whole region may best be devoted to economic advancement. There must be effective machinery for settling priorities in transport, supplies of coal, &c., between the competing claims of the three territories. Industrial development must proceed on a Central African basis if adequate markets are to be available as a basis for new industries and the more backward areas are to secure the advantages of this form of development. The present units of government are too small to sustain the vast expenditure needed for hydro-electric development and large-scale water control schemes and difficulties are already appearing between the two Rhodesias in connection with the plans for the harnessing of the Zambesi and its tributaries. With its enormous potentialities the Zambesi should be the centre of economic activity rather than a frontier. It may be argued that theoretically all these matters could be handled by co-operation between the three existing Governments. Experience over the past few years has shown that this not so and the only effective method of handling them is by a single federal authority answerable to a single Central African Legislature. There can be no doubt, moreover, that in external economic relations Central Africa operating as a single economic unit would be more effective than the three territories operating separately, while from the long-term point of view a Central African federal state with a more broadly based economy would be in a stronger position to face a world recession than the three territories individually.
12. Important as the economic arguments in favour of federation are, we are convinced on the basis of our recent experience in Central Africa that the political arguments are still stronger. We referred in our memorandum of 3rd May to the urgent need to counter South African pressure on Central Africa. Immigration from the Union into the two Rhodesias is almost double that from the United Kingdom. Not all of this is Afrikaner immigration, but we have definite evidence that Afrikaner immigration is being officially inspired, while, as a sign of the political interest being taken by the Nationalist Party in Central Africa, a census of all South Africans in the Rhodesias and their political sympathies is now being conducted through the Dutch Reformed Church. In Southern Rhodesia a new party has just been formed under the title of the Democratic Party; it is directed by a Mr. Cloete, who receives his salary from South Africa and described himself to The Times correspondent as an Afrikaner extremist. In Northern Rhodesia the position is still more serious in view of the comparative smallness of the European community and the dependence of the mining industry on white South African labour and owing to the difficulty of getting suitable people from this country. It is thought probable that at the next General Election in 1953 the Afrikaners will obtain five of the ten European seats on the Northern Rhodesian Legislative Council if the present electoral arrangements remain unchanged. There is a general fear among Europeans of British stock that the Afrikaners will gradually prevail, but the British element among the unofficial European community has so far shown little willingness to take active steps against this menace. The leading Southern Rhodesian Ministers are gravely apprehensive that the Afrikaners will succeed in dominating Northern Rhodesia and will then turn back on them. In Nyasaland there are so far few Afrikaners and the danger is less immediate; but if the two Rhodesias were absorbed or dominated by the Union Nyasaland could hardly stand out against such encroachment.
13. Southern Rhodesia has tightened up its immigration control law and made two years' residence and Southern Rhodesia citizenship a necessary qualification for the vote. The Northern Rhodesia Government is hoping to introduce similar legislation before the end of this year and the Colonial Secretary took the opportunity of emphasising the urgency of this to the Governor and leading unofficials. But the geographical and economic circumstances of the two Rhodesias make it impossible to keep out Afrikaners entirely and in any case immigration control and tighter conditions for the franchise, important though they are, are not sufficient by themselves to resist encroachment by the Union. We are faced in Central Africa with pressure by a country far stronger economically and industrially than any of the Central African territories, led by a militant Nationalist party with expansionist aims, anxious to strengthen its influence in the north. This pressure can be countered only by an equally firm policy of resistance to it both in the political and economic spheres—a policy which must have the support both of the European and African populations of the Central African territories, and which in our view has little chance of succeeding unless we can establish a British bloc of territories in Central Africa knit together by constitutional ties. To secure our objective we must establish conditions in Central Africa under which the British element in the European population will remain not only substantially greater in numbers than the Afrikaners but able and willing to assert their loyalty to the British connection, and at the same time conditions in which the relations between Europeans and Africans will be progressively improved and the share of the Africans in the political and economic life of the territories will be progressively increased under the policy of partnership. In our view the proposals for federation are well designed to achieve these conditions. Political development for Africans in the two northern territories is secured under the scheme to their territorial Governments and His Majesty's Government. The Victoria Falls Conference has accepted the principle of partnership as an essential condition for federation; the federal legislature would contain African representatives from all three territories, and the federal constitution would have full safeguards for African interests. The prevention of excessive Afrikaner immigration could be far more effectively secured on a Central African basis than by the three territories acting separately. The creation of a Central African federal state would greatly strengthen the confidence in themselves of the British elements in all three territories and their willingness to resist Afrikaner encroachment and by increasing the political and economic strength of Central Africa as a whole and reducing friction between its component parts would provide a much firmer foundation on which that resistance could be based. On the other hand, if owing to African opposition federation had to be abandoned, relations between Europeans and Africans in the two Rhodesias would be seriously damaged and particularly in Northern Rhodesia a political vacuum would be created which would open the way for Afrikaner infiltration on a still more powerful scale. Signs are not lacking that the South African Government, although openly its attitude is correct, is anxiously hoping that the federation proposal will come to nothing.
14. We cannot too strongly emphasise the danger to British and African interests at present assailing the Central African territories. In our view we cannot continue to adopt a negative attitude towards this danger. It is incumbent on us to take positive steps to resist it. The establishment of a federal state in Central Africa is by far the most effective step that could be taken and this, combined with the economic advantages, convinces us that positive support for federation should be given by His Majesty's Government. The Afrikaner pressure, moreover, makes early action urgent; but we should be strongly opposed to any attempt to force the federation proposals through in the face of the present solid African opposition. Fortunately the Victoria Falls Conference conclusions, with the adjournment of the conference until the middle of next year, give time for further discussions with Africans in Northern Rhodesia and Nyasaland. The African leaders in Northern Rhodesia have already indicated that they will be prepared to consider the proposals again provided that their own political future inside Northern Rhodesia is secured and discussions to this end between Europeans and Africans are shortly to begin. The African members of the Nyasaland delegation at the Conference revised their views materially after hearing the discussions although their mandate prevented them from saying so publicly and since the Conference, they have already succeeded in persuading one of the three Provincial Councils in Nyasaland to give further consideration to the scheme. The Governor of Nyasaland considers that, provided that His Majesty's Government will publicly state its general support of the federal scheme, there is a distinct chance, given a period of from six to nine months, of persuading Africans to take a less negative line. Both he and the Governor of Northern Rhodesia are convinced that if further progress is to made a favourable statement by His Majesty's Government is an essential prerequisite to it. If therefore our opinion of the advantages of federation is accepted it is clearly important that an early opportunity of announcing this should be taken by His Majesty's Government.
15. We accordingly recommend that, at as early a date as possible after the General Election, the following action should be taken:
(1) His Majesty's Government should publicly endorse the conclusions of the Victoria Falls Conference, including the proposal to hold a further representative conference in London about the middle of next year.
(2) His Majesty's Government should at the same time publicly that it would favour in principle a scheme of federation between the three territories on the general lines recommended by the London Conference of officials and considers that such a scheme would be in the best interests of the Africans as well as of the other inhabitants of the territories; that it recognises that African opinion in the two northern territories has declared itself as opposed to these proposals; but that, in the light of the assurances agreed upon at the Victoria Falls Conference and of the economic and other advantages of closer association, it trusts that Africans will be prepared to give further and favourable consideration to the proposals. His Majesty's Government should also endorse the statement in paragraph 11 (i) of the Victoria Falls Conference communique that any consideration now or in the future of amalgamation of the three territories is excluded unless the majority of the inhabitants of all three territories desire it, and should make it clear that a similar principle would apply equally to amalgamation of two of the territories or any part thereof. (3) The Governors of Northern Rhodesia and Nyasaland should be authorised to arrange further discussions on the proposals with Africans in the two territories on the basis of His Majesty's Government's statement that they favour the scheme in principle and in the light of the assurances agreed to at the Victoria Falls Conference.
(4) The discussions envisaged in paragraph 5 of the final communiqué of the Victoria Falls Conference between His Majesty's Government and the three Central African Governments, or between the three Central African Governments themselves, should be undertaken in due course with the object of elucidating points of detail in the officials' report in preparation for the London Conference.
(5) We should regard the federation of the three Central African territories as an essential measure for preventing non-British influences from the Union of South Africa from encroaching on and eventually engulfing British Central Africa. In the public statement referred to above we should endorse the agreed statement of the Victoria Falls Conference that the British connection and British traditions and principles in the Central African territories should be so strengthened as to ensure that they continue to prevail.
16. No detailed examination of the proposals in the officials' report is needed at this stage, but there are certain important points on which we wish to record our views. The final communiqué of the Victoria Falls Conference records that there are certain proposals in the officials' report relating to the federal Legislature with which the Southern Rhodesian Government do not agree; these are known to concern the number of nominated members proposed for that Legislature, the African Affairs Board and the Minister for African Interests. Our views on these points are as follows:
(a) The Southern Rhodesia difficulties about the nominated members in the Legislature can to some extent at any rate be met. The officials' report (paragraph 90 and Annex VII) proposes that the federal Legislature should consist of seventeen members from Southern Rhodesia, eleven from Northern Rhodesia and seven from Nyasaland, three of whom from each territory would represent African interests. Of the twenty-six general members the fourteen from Southern Rhodesia and the eight from Northern Rhodesia would be elected, while the four from Nyasaland would be nominated by the Governor from a panel selected by the Convention of Associations (the body officially representing Europeans in the territory). The Southern Rhodesia Government take the view that on the basis of twenty-two elected members it would be difficult to operate a party system effectively. In our view we can meet them over this by arranging for the four Nyasaland representatives to be elected, either directly or indirectly. Of the African representatives those who are actually Africans could also be elected indirectly, leaving only three European representatives of African interests to be nominated.
(b) It is possible that Southern Rhodesia will suggest a bicameral legislature with a Senate consisting partly of members representing African interests as a substitute for the African Affairs Board proposed by the officials. Our view (which was made clear to the Southern Rhodesian Cabinet by the Commonwealth Secretary) is that any such suggestion should be opposed, first because a second chamber would make the constitution cumbersome, and secondly because we do not believe that a second chamber, however composed, could be as effective as a safeguard for African interests as the African Affairs Board proposed in the report. Powers of delaying legislation would not be sufficient, while it would be hard to secure a second chamber with an absolute veto.
(c) The Southern Rhodesia Government is likely to suggest that the Minister for African Interests should be appointed in the ordinary way on the recommendation of the Prime Minister rather than by the Governor-General subject to the approval of His Majesty's Government. We think that such a proposal should be rejected, since a Minister responsible to the Prime Minister rather than to the Governor-General and His Majesty's Government could not effectively exercise the safeguarding powers proposed for the Minister for African Interests in the report, which are the lynch-pin of the proposed federal safeguards. Such a change would moreover be strongly objected to by African opinion and would make it more difficult to convince Africans in the northern territories that the scheme does not prejudice their interests. The Commonwealth Secretary sought to persuade the Southern Rhodesian Government that, with good will on both sides, the appointment of the Minister of African interests need cause no constitutional difficulties. They could be assured that His Majesty's Government would for its part work the system reasonably.
17. It will also be open to His Majesty's Government at the conference in London next year, and indeed to the African representatives at that conference, to put forward any amendment of detail to the proposals which may appear necessary from the African point of view since, owing to African opposition to the principle of federation there was no opportunity at the Victoria Falls Conference of obtaining the views of Africans on the details of the scheme. The way for this is kept open by the statement in paragraph 14 of the Victoria Falls Conference communiqué.
J. G. P. C. G. W.
FINAL COMMUNIQUÉ OF THE CONFERENCE ON THE CLOSER ASSOCIATION OF CENTRAL AFRICAN TERRITORIES: 21ST SEPTEMBER, 1951
1. The present Conference was convened by the Governments of the United Kingdom, Southern Rhodesia, Northern Rhodesia and Nyasaland for the purpose of discussing the question of closer association of the British territories in Central Africa.
2. The Conference opened at Victoria Falls on Tuesday, 18th September, and was of a representative character. In the case of Southern Rhodesia the representatives included the Prime Minister and other Ministers, and leaders of the Opposition parties in Parliament. In the case of Northern Rhodesia the delegation consisted of the Governor and official and unofficial members of the Legislative Council including Africans. Nyasaland was represented by the Governor, senior officials and leading unofficial persons, European and African. The United Kingdom delegation consisted of the Secretaries of State for the Colonies and for Commercial Relations, accompanied by some of their chief advisers.
3. The Conference had before it the Report prepared last March by a number of senior official advisers of the four Governments concerned. The authors of that Report had been requested "to examine the problem in all its aspects and consider whether it is possible in the light of this examination for them to formulate proposals for a further advance to be made in the closer association of the three Central African territories which they could recommend to the Governments of these Territories and to His Majesty's Government in the United Kingdom." Their work was purely exploratory and did not commit any of the participating Governments to the adoption of any proposals that they might formulate.
4. The Report of the London Conference of officials was unanimous on all points. Its main recommendation was that closer association between the three territories ought to be brought about and that the need for this is urgent. It recommended further that this should be done not by amalgamation of the territories, but on a federal basis; and put forward in some detail a scheme framed to take particular account of the special features of the Central African situation, including the self-governing status of Southern Rhodesia, and designed to provide substantial safeguards for the interests of Africans. Moreover, those matters most closely affecting the life of Africans would, under the proposals in the Report, come within the territorial and not within the federal sphere; and within the territorial sphere the Northern Rhodesia and Nyasaland Governments would remain responsible, as at present, to His Majesty's Government in the United Kingdom.
5. In announcing the present Conference it has from the outset been made clear that there was no intention of reaching decisions at it binding on any Government. It was realised that such a Conference might disclose points of difference with regard to the principle of federation as well as to the proposals made in Report CABINET
BILATERAL AND TRIPARTITE TALKS IN WASHINGTON AND ATLANTIC COUNCIL MEETING IN OTTAWA
10TH–20TH SEPTEMBER, 1951
MEMORANDUM BY THE SECRETARY OF STATE FOR FOREIGN AFFAIRS, THE CHANCELLOR OF THE EXCHEQUER AND THE MINISTER OF DEFENCE
Introduction
Our colleagues will recall that in a recent paper (C.P. (51) 239) the Prime Minister gave an outline of the various international problems which would be coming up for discussion during the meetings which were to be held in North America in September and of the policy of His Majesty's Government towards them. We now wish to give the Cabinet a brief report of these meetings.
2. The Foreign Secretary left the United Kingdom on 6th September to attend the Japanese Peace Conference at San Francisco. He then flew to Washington for conversations first with Mr. Acheson alone and then with Mr. Acheson and M. Schuman, in both of which he was joined by the Chancellor of the Exchequer, who was at the same time attending a parallel series of talks in connexion with the International Monetary Fund. The Secretary of State and the Chancellor of the Exchequer then flew to Ottawa on 14th September where, together with the Minister of Defence they attended the seventh session of the North Atlantic Council, which concluded on 20th September.
3. A separate report will be prepared on the San Francisco Conference. The present report will, therefore, cover only the bilateral and tripartite talks in Washington and the Atlantic Council meeting at Ottawa.
4. The four main achievements of the Washington and Ottawa Talks were in respect of Germany, Turkey and Greece and the Middle East Command, the financial aspects of defence, and Korea.
5. On Germany we reached tripartite agreement on the next stage of the negotiations with the German Federal Government for the replacement of the present occupation régime by a new contractual relationship (see Section I below).
6. On Turkey and Greece and the Middle East Command, there was agreement in the Atlantic Council to recommend to governments the admission of Greece and Turkey to the North Atlantic Treaty and also agreement between the United States and ourselves on the establishment of a Middle East Command and a joint invitation to Turkey to join it (see Section II).
7. On the financial aspects of defence we put before the Americans the balance of payments difficulties of the United Kingdom and the Sterling Area and explained that these might interfere with the fulfilment of our £4,700 million programme, and in any case made it impossible for us to contemplate accepting any further burdens. The action taken was to establish a twelve-power N.A.T.O. committee of so-called "wise men" to study, over the next two months, the whole question of financing the N.A.T.O. defence effort (see Section III).
8. On Korea the Americans gave us their views on the future conduct of the campaign and we were able to impress on them the need for caution if the Korean war was not to grow into a world war with Russia (see general discussion on the Far East, Section IV below).
9. Other principal issues discussed were: the Italian Peace Treaty and Trieste, Austria, Spain, Persia, policy towards the satellites, availability of defence forces, development of the non-defence aspects of N.A.T.O., and the frequency of and attendance at, future Council meetings (see Sections V-XII below).
I.—Germany
10. At their last meeting in Brussels in December 1950 the three Occupying Powers reached agreement on a three-fold programme:—
(a) At the invitation of the Atlantic Council they instructed the three High Commissioners to hold exploratory discussions with the Federal Government regarding German participation in the defence of Western Europe;
(b) they took note of the intention of the French Government to call a conference in Paris to discuss the “Pleven Plan” for a European Army;
(c) they instructed the three High Commissioners to begin exploratory discussions with the German Federal Government on the replacement of the existing occupation régime by a new contractual relationship.
11. As a result of the Foreign Secretary’s talks at Washington with Mr. Acheson and M. Schuman, this programme has now been carried a stage further.
German Contribution to Western Defence
12. We considered the High Commissioners’ report of their discussions with the German Federal Government, the so-called “Bonn Report,” and agreed that, pending further developments at the European Army Conference in Paris, discussions with the German Federal Government should be suspended and the “Bonn Report” put into cold storage.
European Army
13. M. Schuman explained the progress which had been made at the Paris Conference. Apart from the French Government, the German and Italian Governments had now agreed in principle to the establishment of a European Army to include a German contingent. The military details of the European Army were now being worked out by military, financial and juridical sub-committees of the Conference, and it was hoped to submit to the next meeting of the Atlantic Council in Rome in November a set of concrete practical proposals for the immediate creation of a European Army. M. Schuman was at pains to emphasise the genuinely international character of the European Army and the sacrifices which it would involve for France. Once there was a European Army, France would cease to have a national army except for the defence of her overseas territories. M. Schuman also represented strongly the French view that no steps should be taken to raise German units or to put a single German into uniform except as part of a European Army. Finally, M. Schuman declared that in all matters of military detail including the size of national units the French Government would be guided by the advice of military experts, including General Eisenhower.
14. Mr. Acheson made it quite clear that the European Army conception had the full backing of the United States Government, who had been convinced by General Eisenhower that it was a militarily practicable proposal.
15. As a result of the previous Cabinet decision on 4th September (C.C. (51) 58th meeting) the Foreign Secretary was able to assure Mr. Acheson and M. Schuman that His Majesty’s Government were disposed to favour the plan for a European Army, of which German forces would form part, that we agreed that the working out of its military arrangements must be undertaken by the Paris Conference in consultation with General Eisenhower, and that in order to assist in this work we were sending high-level military observers to Paris. At the same time he reserved our right to call for more intimate tripartite discussions if this should appear necessary and made it clear that we expected the Atlantic allies to receive preference over Germany in the supply of arms and equipment.
16. Our intervention in favour of the European Army, which was subsequently repeated in the Atlantic Council, undoubtedly gave great pleasure to the French. It was also welcomed by the Americans and there can be no doubt that it was the right course of action. By our acceptance in principle of the European Army we have re-established three power unity on the question of German defence.
Contractual Relations with Germany
17. Before Ministers got to Washington, officials of the three governments had prepared for their consideration a draft of detailed instructions to guide the three Allied High Commissioners in their negotiations with the German Federal Government for the replacement of the Occupation régime by a new contractual relationship. This draft followed the general lines foreshadowed in the Prime Minister's memorandum C.P. (51) 240 of 30th August. The Foreign Ministers were able at their meetings to resolve outstanding differences and to give final approval to these instructions. They have now been issued, and the three High Commissioners have begun their negotiations with the Germans. The basis of these instructions is that the objective should be to establish a firm political basis for our relations with the German Federal Republic, which could be maintained until a peace settlement with a unified Germany became possible; and that only such safeguards should be retained as were essential and could be maintained effectively for an extended period of years. The three powers would be ready in the framework of the contractual arrangements to abolish the Occupation Statute and to replace the High Commission by a Council of Ambassadors. They would exercise their supreme authority only in order to discharge their responsibilities regarding Germany as a whole, to deal with questions relating to Berlin, and to station forces in Germany and protect the security of these forces. They would retain the right to declare a state of emergency and take any necessary action in the event of a threat to public or constitutional order constituting a menace to the security of their forces. The Allied forces in Germany would no longer be forces in occupation of the territory of a defeated enemy but forces co-operating in the common defence to which the Federal Republic will be contributing as a partner; and their status should, so far as possible, be assimilated to that of friendly forces stationed in an Allied country. This would involve changes in the field of jurisdiction, for instance the abolition of existing Allied courts in Germany.
18. In all other fields Allied relations with Germany would be placed upon a basis of agreement and consent to be regulated by the various detailed contracts to be negotiated. In the field of restrictions on German industry, it is proposed that the German Federal Government should be asked in the contracts to maintain certain minimum prohibitions, primarily of a military nature, based upon the list drawn up by the North Atlantic Council in Brussels last December, they would also be asked to accord the Allies the necessary minimum rights of verification and inspection. A meeting of representatives of the three Governments at official level is to take place shortly in London to define and clarify these restrictions on production.
19. A tripartite meeting of officials is also to be held in London to consider further the difficult problems involved in the financial field as a result of German participation in Western defence. The Foreign Secretary will shortly be circulating a paper on this subject.
20. The idea emerged at the Foreign Ministers' meeting that at the time of any such further meeting with the German Chancellor it might be desirable to issue a joint declaration which would define the political principles upon which the arrangements as a whole were based. Such a declaration might also reaffirm the security guarantee of the Federal Republic and Berlin originally given in the New York communiqué of 15th September, 1950. In addition it might contain some assurance of the intention of the Allies to maintain troops in Germany in sufficient strength to deter Soviet aggression. No final decision was reached in these matters which will call for further consideration.
21. The Americans optimistically hope that the negotiations with the German Federal Government will be concluded within the next two months so that a treaty can be signed before the Rome meeting of the Atlantic Council at the end of November. It seems very doubtful whether we shall be able to keep to such a tight timetable: we have nevertheless now at last set in motion a process which should enable the Allied Powers to carry forward a further important stage of their policy of incorporating Western Germany as an equal member in the Western European Community.
Declaration on Germany
22. At the conclusion of the tripartite meetings in Washington, the three Foreign Ministers issued a public declaration setting out in general terms the broad objectives of their German policy. This declaration says that the aim of the three governments is “the inclusion of a democratic Germany, on a basis of equality, in a continental European community, which itself will form part of a constantly developing Atlantic community.” The declaration then goes on to pay tribute to the Schuman and Pleven Plans and today that the United Kingdom “desires to establish the closest possible association with the European continental community at all stages in its development.” It concludes with a reaffirmation of the peaceful and defensive purposes of the North Atlantic Treaty. From the public point of view, this declaration has had three important results. In the first place, it has put in its proper perspective the Allied decision to modify the Occupation regime and to rearm Germany as one step in the developing process of achieving European unity. Secondly, it is the first formal recognition by the United States and France of the special position of the United Kingdom in relation to European unity, and of our inability to integrate fully with Europe. Finally, by removing any ambiguity on this score and laying down clearly that while we cannot join the “European Community” we nevertheless wish to be closely associated with it, the declaration has succeeded in dissipating the distrust and suspicion of our policy in Europe which has for so long been embittering Anglo-French relations.
Benelux
23. Mr. Acheson, M. Schuman and the Foreign Secretary were careful to keep Benelux fully informed of our negotiations with regard to Germany, not only through officials but also through personal meetings with their Foreign Ministers in Ottawa. They gave their full approval to our decisions.
II.—Turkey and Greece and the Middle East Command
24. Our colleagues will recall that the Cabinet only agreed to the admission of Turkey and Greece to the North Atlantic Treaty on the assumption that we obtained in return Allied, and in particular American, agreement on the setting up of a Middle East Command, including Turkey, under a British Supreme Commander. Our object at the Washington and Ottawa meetings was therefore to try and get the tightest possible agreement on the Middle East Command arrangements before we gave our vote at the Atlantic Council for the admission of Turkey and Greece to N.A.T.O. In the event, this proved to be perhaps the most difficult job of the conference.
25. As far as the admission of Greece and Turkey to the North Atlantic Treaty was concerned, there was no real opposition except for pro forma protests from Norway and Denmark and, to a lesser extent, Holland. At its last meeting on 20th September the Council passed a resolution recommending each Government to “take whatever steps may be necessary to enable it to agree that the Kingdom of Greece and the Republic of Turkey be invited to accede to the North Atlantic Treaty and thereupon notify its agreement to the Government of the United States.” The effect of this resolution is to leave the final decision on the admission of Turkey and Greece to national Governments and Parliaments, and Turkey and Greece can, therefore, only become members of the Treaty when all Parliaments and Governments have formally notified their approval.
26. On the Middle East Command, on the other hand, we ran into serious difficulties with the Americans, the French, and some of the smaller Atlantic Powers led by Holland.
27. The Americans have never been quite solid on the subject of the Middle East Command, nor shared our view that Turkey belongs primarily to the Middle East and is essential to its defence. They have tended rather to emphasise Turkey’s value to Europe. Their chief anxiety is to secure Turkish military strength for the West and they do not seem to mind very much, and certainly not as much as we do, whether that strength is contributed through a Middle East Command or through General Eisenhower's European Command. Our job was, therefore, to convince them not only that a Middle East Command is essential to the solution of our joint difficulties in the Middle East (especially in Egypt), but also that, without Turkey, it is military nonsense. In this we were on the whole successful.
28. As a result of the Washington and Ottawa talks they agreed, not only to join with us in presenting the Middle East Command proposals to the Turks, but also to send General Bradley to Ankara to join with Field-Marshal Slim in pressing them on the Turkish Government. They also agreed to join with us in an invitation to Egypt to take part in the Command organisation as a founder member. In order to get this much, however, we were obliged to agree that, as far as the defence of Turkey is concerned, the Supreme Allied Commander, Middle East, should be responsible to the North Atlantic Treaty Organisation while remaining outside N.A.T.O. for purposes of the defence of the rest of the Middle East. We think that we can be satisfied that this arrangement can be made to work in practice. It must be remembered, however, that the Americans are less attached to the idea of a Middle East Command than we are, and may not be willing to keep up pressure on the Turks throughout the negotiations which still have to take place before the Command is established.
29. Rather to our surprise, the French, who had most to gain by being associated with a Middle East Command (since they have hitherto been excluded from defence planning in the Middle East) and the least to contribute to it, also made difficulties from the start. They saw the importance which we, and to a lesser extent, the Americans, attach to the establishment of this Command, and evidently thought the opportunity good to blackmail us into giving way to them on points of purely French national interest. M. Schuman said that he could only accept the proposed Command arrangements (including the British Supreme Commander) on two conditions:
(a) That a French officer was given a high appointment at the Supreme Commander's Headquarters; and (b) That in order to balance the British naval command in the Eastern Mediterranean a French Admiral was given the naval command in the Western Mediterranean.
30. The first French condition caused little difficulty. After consulting the Chiefs of Staff, the Minister of Defence and the Foreign Secretary were able to agree that a French officer of the rank of Major-General or Vice-Admiral should be appointed to the Supreme Commander's Headquarters. Mr. Acheson also agreed. The second French condition was more difficult to meet. The Americans were unwilling to accept a French naval command in the Western Mediterranean as they considered that this would interfere with the control of naval operations on General Eisenhower's Southern Flank, which had been entrusted to Admiral Carney.
31. The proposal also presented difficulties from our own point of view as to responsible for east-west communications in the Western Mediterranean if he is properly to fulfil his task of supporting the Supreme Commander, Middle East, in the Eastern Mediterranean. In spite of two special tripartite ministerial meetings, it was impossible to reconcile these views either at Washington or Ottawa. No agreement was therefore reached and we were obliged to leave Ottawa without having obtained the agreement of the French Government to our Middle East Command proposals. It was left that Field Marshal Slim and General Bradley would visit Paris on their way to Ankara and try to reach agreement on the Western Mediterranean in consultation with their French colleagues and with General Eisenhower so that a French General could join them in their mission to Turkey. The Paris talks would also have as their object the finding of an acceptable military solution of the problem of the responsibility for Turkish defence referred to in paragraph 27 above. (See footnote * below.)
- Tripartite agreement was subsequently reached in Paris on a formula, whereby, Turkey, although a member of N.A.T.O., "would be primarily associated with arrangements for the defence of the Middle East." But the latest reports from Ankara indicate that Turkey is still holding out for participation in General Eisenhower's command as the first step in her admission to N.A.T.O.
32. The objections of the smaller Atlantic Powers to the proposed Middle East Command were of a different kind. They arose from the fear that by her inclusion in a special command all of her own Turkey would enjoy a privileged position and escape the common scrutiny of her defence effort to which all other N.A.T.O. Powers are subject. It was only with great reluctance that some of the smaller countries, especially Norway, Denmark and Holland, agreed to accept Turkey into N.A.T.O. at all. Led by M. Stikker, they argued strongly that they could only do so if they were convinced that Turkey would be subject to exactly the same obligations as they are themselves. In order to appease this body of small Power opinion, it was necessary for us to agree first that all matters affecting the defence of Turkey would be subject to the control of the North Atlantic Treaty Organisation (this was the same point which the Americans had made, for different reasons); and, secondly, that the smaller Powers should be kept fully informed through the Council Deputies of the progress of three-Power discussions with the Turks.
III.—Financial Aspects of Defence
33. What we had expected to achieve at Ottawa was a realistic "confrontation" of the military and financial implications of the defence effort which would cause N.A.T.O. as a whole to review its plans and to work out a balance between the requirements of security and of economic stability in the twelve countries. Our particular objective as far as the United Kingdom was concerned was to make clear to the United States administration the seriousness of the impact of our present defence programme on our economy, and to resist any suggestion that we could do more unless there were to be radical changes of policy in the direction of a war economy both internally in each member country and in their financial relationship with each other.
34. Both these objectives were to a relative extent achieved.
(a) Exposition of the United Kingdom Situation
35. The Chancellor of the Exchequer was able both in Washington and at Ottawa to give a full account of the economic and financial position of both the United Kingdom and the Sterling Area and thus to illustrate the clash between military security and economic stability which is common in some degree to every N.A.T.O. country. He made it clear that our overall balance of payments deficit, combined with the threat of a severe dollar crisis, were making our situation increasingly difficult. While production for defence was so far up to schedule, we might be forced, if the external financial position deteriorated further, to increase our exports of goods produced by the metal-using industries, which could only be at the expense of rearmament orders. There was a danger, therefore, that we might not be able to complete our projected three-year £4,700 million defence programme on time; and it was clearly quite out of the question, in present conditions, for us to contemplate anything in the nature of an increase over our present plans. The Chancellor of the Exchequer explained to the Americans at Washington that we could not accept our forces allocation under the Medium-Term Defence Plan as a realistic target in present circumstances: the existing £4,700 million programme would not even fully equip the forces which we had undertaken to contribute to N.A.T.O. and forces in other parts of the world. Still less could be think in terms of the even higher targets on which General Eisenhower was now understood to be working.
36. Our statement was, of course, borne out by the analysis of the United Kingdom situation in the F.E.B. Report, which concludes that "the effective limit to the United Kingdom defence programme is set by the dangers to its external financial position which an even larger programme of defence production would entail." We have, it appears, convincingly carried our point both to the Americans and to N.A.T.O. as a whole that we can undertake no further efforts without either more external aid or taking the drastic step of turning over to a virtual war economy.
(b) French Position
37. M. Mayer, the French Finance Minister, made it equally clear both in Washington and Ottawa that France had reached the limit of her capacity for rearmament in present conditions. French industry was working at full pitch wherever practicable, but dependence on raw materials, and especially fuel imports, from dollar sources, particularly in the steel industry, was an important limiting factor. France had still not completed her reconstruction programme; her defence programme affected home consumption, with the resulting danger of inflation, as well as exports; and her resources in money and men were being drained by the war in Indo-China. The French dollar situation was serious, and M. Mayer said he was convinced the French Government would have to determine a maximum limit beyond which they could not carry their total defence effort without creating a disastrous inflationary deficit and endangering the currency, with fatal economic and social results, which would defeat the very objectives we sought to attain. He pleaded finally for further integration of the defence programmes of the United States and Europe by making the best possible use of our joint industrial capacity, in particular by further placing of orders in European factories and by off-shore purchases by the United States.
(c) The "Wise Men" and Prospects for the Immediate Future
38. Discussion around the F.E.B. Report on the position of individual N.A.T.O. countries, and its recommendations for national and international action to increase productivity and maintain economic stability, despite the claims of the defence effort, had the effect which we had been seeking: to bring face to face the discrepancies between economic and financial possibilities and military needs, and to make it clear to the United States that what was required was to examine and "confront" these two aspects of the problem and see what conclusions should be drawn. Time at Ottawa was too short, of course, to enable an exercise of this magnitude to be carried out in detail. The concrete outcome of the discussions in the Council was the adoption of a proposal, originally put forward in a rather different form by the French, to set up a temporary committee of the Council "to analyse the issues involved in reconciling, on the one hand, the requirements of external security . . . . and, on the other, the realistic politico-military capabilities of member countries." This committee (sometimes referred to jocularly as the "Wise Men") will consist of representatives of all twelve countries, of ministerial or near-ministerial rank, who will be responsible for all negotiations with the Governments concerned. There will also be a small Steering Group or Executive Bureau, composed of the American Chairman of the full Committee and the British and French Vice-Chairmen, to steer and expedite the work. All the military and civil agencies of N.A.T.O. are directed to co-operate with the committee in producing the military, production, financial and economic data required to build up a composite picture of the defence effort. The first step is for the Standing Group to estimate the military requirements for the defence of the North Atlantic Treaty area, and to make recommendations, again from the military point of view, for meeting those requirements. When this and information about economic capabilities are available, the Committee will be able to begin the actual task of "confrontation." A progress report will be made to the next North Atlantic Council meeting at Rome in November and a full analysis of the committee's findings is scheduled for 1st December. (The Committee began its meetings in Paris on 9th October. The United Kingdom has been represented at these meetings by the Chancellor of the Exchequer or, in his absence, by Sir E. Plowden.)
39. Hitherto, N.A.T.O. has worked in what have been water-tight departments dealing with the elementary stages of the finance, defence and production problems. This is the first time that any attempt has been made to pull together the threads of these various activities into one pattern. The proposed study will, it is hoped, at last throw up the real difficulties. We have therefore whole-heartedly supported this initiative, on the assumption that in bringing out more fully the implications of carrying out the defence programme, it will lead to firm and joint conclusions by Governments as to whether: (a) it is consistent with security to reduce the military plan; and/or (b) the economic efforts must be increased by drastic means, and, if so, how this can be done in full co-operation between the countries concerned. For the time being it is understood, of course, that countries carry on uninterruptedly with their planned defence programmes as best they can.
(d) Infrastructure
40. For several months before the Council Meeting the Deputies had been engaged in fruitless discussions on the division of the cost of an urgent programme of airfields and communications, known collectively as infrastructure, for the common use of the forces defending Western Europe. Their failure to reach a solution lay in the refusal of the United States Government, on the one hand, to depart from a "user" formula (under which they would pay no more than could be justified to Congress on the basis of direct support for the United States forces) and on the other and continental view that "capacity to pay" must be the deciding factor.
41. Shortly before the Council, the United Kingdom had put forward an arbitrary cost-sharing formula aimed at striking a compromise between these two points of view, but this had not proved acceptable to the Americans. At Ottawa, under the stimulus of a message from General Eisenhower that urgent work was being delayed by the absence of agreement on cost-sharing, a series of meetings between the United States, French and British Ministers resulted in an agreement which was not dissimilar to our proposal and which also proved acceptable to the smaller countries. Under this agreement towards a total estimated cost of £84.5 million, the United States pay £38 million, we pay £14 million the French pay £17 million plus the cost of land, &c., estimated at £4 million, and the other N.A.T.O. countries concerned share the remaining £11.5 million.
IV.—Far East: Korea, China, Indo-China
42. Talks took place between the Foreign Secretary and Mr. Acheson on the Far East on 11th September and on a tripartite basis with M. Schuman on 14th September.
Anglo-American Talks
43. Mr. Acheson gave an outline of the United States Government's proposals for action (a) if the Korea armistice talks were successful and (b) if they broke down completely.
44. The United States Government had not given detailed thought to the steps to be taken if the armistice talks were successful since they were doubtful whether political discussions arising out of an armistice could take place in the near future. If political discussions eventually took place they should be confined to the future of Korea only, between the United Nations on the one side and the North Koreans and their supporters on the other. The United Nations should not abandon the principle of a unified and democratic Korea. The United Nations had never given their blessing to the political division of Korea and should not now do so. The Secretary of State said that he was in general agreement with these views but that three points should be borne in mind:
(a) We should not lose sight of the desirability at a later stage of a wider conference to discuss Far Eastern problems as a whole.
(b) Political discussions on Korea should not be allowed to give the impression that the United Nations was a purely anti-Communist organisation. Our view was that the United Nations was a world organisation of which countries of all political creeds were members.
(c) In considering a political settlement in Korea it was essential to take steps to ensure that Korea could survive as a democratic State; it would be a pity if any settlement allowed the new Korean Government to be threatened by a Communist fifth column from within. Any settlement must also cover the question of Chinese representation in the United Nations.
45. Mr. Acheson considered that the world situation would become much more dangerous if the armistice talks broke down completely. In the latter event and on the advice of their Joint Chiefs of Staff, the United States Government proposed that:
(i) War production in the United States would be increased.
(ii) The scale of operations in Korea should be increased on the assumption that General Ridgway would receive reinforcements.
(iii) Since a stalemate would have an adverse effect on United Nations troops' morale, General Ridgway should be authorised to take the initiative in a series of battles of manoeuvre and be given discretion to penetrate as far as the "waist" of Korea. (iv) Training and rearmament of the Japanese Police Reserve should be expedited and the size of the force increased so that three or four Japanese Divisions could be formed to carry out internal security duties.
(v) The training and equipment of Korean defence forces should be intensified.
(vi) All restrictions on the bombing of targets within Korea should be removed and General Ridgway authorised to bomb the dams across the Yalu River and power stations on the south bank of the river provided that the Manchurian frontier was not crossed.
(vii) If major air attacks were made on United Nations forces from bases outside Korea, General Ridgway should be authorised to carry out standing instructions to eliminate the air bases from which the attacks were mounted.
(viii) The Unified Command should report to the United Nations on the armistice talks, making it clear that the breakdown was the sole responsibility of the North Koreans and their associates.
(ix) The United Nations should be asked to reaffirm its determination to oppose aggression in Korea and to provide additional help.
(x) Members of the United Nations should be asked to support an embargo on all shipments to China and to agree voluntarily to prevent their ships entering Chinese ports. The United States Government recognised that a naval blockade of China was impracticable.
46. The Foreign Secretary then made the following comments:
(a) His Majesty's Government were anxious not to become involved in a full-scale war in China.
(b) Korea was one example of Russian trouble-making and there was no telling where and when she might make trouble next in Asia or elsewhere. Economic and social conditions in the Middle East provided a good opportunity for Russia to make trouble. The Korean war should not be considered in isolation but as part of a global struggle between the West and Russia.
(c) China was not yet, in our view, proved to be a slavish satellite of the Soviet Union. We should avoid driving Russia and China closer together and maintain such contacts as we had with the Chinese Government.
(d) We would prefer to defend the Kansas Line in Korea rather than a line which might not be tactically as favourable.
(e) The Foreign Secretary promised to think over the proposal regarding discretion to General Ridgway to manoeuvre north of the Kansas Line up to the "waist." (Subsequently after consideration in London the State Department was informed that we would prefer that there should be no major advance to the "waist" without specific Governmental approval, but that should the enemy become disorganised and demoralised, General Ridgway's hands should not be tied and that in such circumstances an advance by manoeuvre as far as the "waist" but not beyond, might well be undertaken.)
(f) He agreed that a stalemate in Korea would be bad for the morale of the United Nations troops.
(g) He assumed that the Japanese Police Reserve Divisions would not be used in Korea but only for internal security duties in Japan. Mr. Acheson confirmed that this was the intention. (The State Department was subsequently informed that we agreed that the minimum rearming of Japanese internal security forces could be undertaken provided equipment was not at the expense of other N.A.T.O. countries and if it was militarily necessary to withdraw part of the United States garrison in Japan to Korea. We also wished the raising of any such forces to be carried out in such a manner as to prevent any provocation to Russia while the Peace Treaty is not in effect.)
(h) He agreed that efforts should be made to build up dependable South Korean forces.
(i) On the bombing of the Yalu dams and power stations we reserved our position. (Subsequently, after consultation with London, we informed the United States Government of His Majesty's Government's concurrence. As regards retaliatory bombing of targets in China—see paragraph 4 (vii) above—the United States Government have again been informed that we consider prior consultation essential. They have not accepted this viewpoint as they consider that a situation might arise in which, for the safety of the United Nations forces, retaliatory bombing would be necessary but in which time might not permit prior consultation. Discussion with them continues.)
(i) We were glad that the United States Government did not consider a naval blockade practicable. As regards members of the United Nations being asked to stop their ships from calling at Chinese ports, the Secretary of State said that this would cause us difficulty and that he would wish to consider the question further. (As the result of further consideration in London the State Department has been informed that we would be against an embargo on all shipments to China and on ships entering Chinese ports since this would be tantamount to an economic blockade, a policy to which we are opposed. We are, however, willing to discuss means of strengthening the existing embargo under the United Nations Resolution of 18th May, 1951, and of making it more effective.)
(k) The Foreign Secretary agreed with the proposals made by Mr. Acheson in paragraph 4 (viii) and (ix) above, but pointed out that His Majesty's Government would find it difficult to spare more troops. (The State Department were subsequently informed that agreement was conditional on any reinforcements not being at the expense of national contributions to N.A.T.O.)
Tripartite Talks
47. On 14th September M. Schuman joined us in our discussions on the Far East. Mr. Acheson and the Secretary of State both put forward, in somewhat more general terms, the points we had already made in the bipartite talks as recorded above. M. Schuman took note of our statements which he said would require study in Paris. He then referred to Indo-China, where France had two main objects. The first was to obtain the maximum internal support for the agreements between France and the Associate States, and the second was to build up the Viet Nam Army. Great progress had been made with the latter, and the Associate States had decided on general mobilisation in October. The chief danger was Chinese intervention in force, especially if there was to be an armistice in Korea which would release Chinese troops for service elsewhere. It was of paramount importance for the United States, Britain and France to maintain contact on the situation in South-East Asia.
48. The Secretary of State assured M. Schuman that the United Kingdom was behind France in her struggle in Indo-China and would give her all reasonable and practicable support. Mr. Acheson commented that the United States Government regarded the maintenance of a strong position in Indo-China as of vital importance.
General
49. Though realistic, Mr. Acheson's programme for the Far East is fundamentally cautious, and with some important reservations, particularly on the economic side, we have been able substantially, to accept it.
V.—Italian Peace Treaty and Trieste
50. At the tripartite meetings in Washington we reached agreement on the text of the Tripartite Declaration on the revision of the Italian Peace Treaty, and decided that it should be published as soon as we had agreed with the Italians on the text of the proposed Italian Note to the signatories of the Treaty. The substance of the Note was agreed at Ottawa and (as our colleagues are aware) the Declaration was accordingly issued at Washington on 26th September, during Signor de Gasperi's visit to the United States.
51. As regards the time-table for de facto revision, the Americans insisted that the final stage, i.e., the favourable reply to the Italian Note, should not be delayed by more than six to eight weeks from the moment the Note was presented. They did not feel that our agreement to the revision of the Treaty should be dependent on a settlement of the Trieste issue. The Foreign Secretary made it clear that we attached great importance to bringing Yugoslavia and Italy together and that, though he would agree reluctantly not to make this settlement a condition of revision, we must continue to put strong pressure upon them from now on to achieve it. It was important that Italy herself should not know a time limit had been set for our reply lest she should try to spin out the Trieste negotiations. If she remained under the apprehension that they were an essential preliminary to revision of the Treaty she would be much more likely to try to reach a quick settlement.
52. The three Foreign Ministers agreed accordingly that when the Italian Note was received it would merely receive a sympathetic acknowledgement and that six to eight weeks might then elapse, during which we should do our utmost (a) to persuade the Italians and the Yugoslavs to settle the Trieste issue, and (b) to ensure through diplomatic channels, the co-operation of other signatories, especially India, Yugoslavia, Ethiopia and Greece. We would hope that by then the Trieste issue would have been settled: but whether it had or not we would expect to send notes of reply at the end of this period. The notes would say:
(a) that so far as our bilateral relations were concerned, and without prejudice to the rights of third parties, we agreed not to enforce certain specified articles of the Treaty; (b) that the moral stigma inherent in the Preamble of the Treaty no longer affected our bilateral relations.
We would hope that other signatories would then do likewise.
53. Rather to our surprise the Americans did not seem to be greatly impressed by the argument that the Italian question must be handled in a way so as to cause the least possible offence to Tito. Whether because of internal political considerations connected with the Italian vote or for some other reason, the Americans clearly thought that Italy was the better horse to back if it came to a choice. Their calculation is presumably that Tito has now burnt his boats and is firmly landed on the Western side. However, we have probably started them thinking.
54. During the Ottawa meetings the Italians also secured the tacit support of N.A.T.O. for the elimination of any discrimination against them under the Peace Treaty. The Council approved a statement on the North Atlantic Community stating inter alia that all obstacles which hindered co-operation between the N.A.T. countries on an equal footing should be removed. Signor De Gasperi asked the Council—having previously obtained our support and that of the French and Americans for this move—to agree that these words should be regarded as applying particularly to Italy. This interpretation was strongly backed by M. Schuman and was not challenged by any member of the Council. It is thus now common ground in N.A.T.O. that our intention is to re-establish Italy's position on an equal footing with other members as soon as this becomes practicable. We did not, of course, accept the view that N.A.T.O. had a locus standi on revision.
VI.—Austria
55. The Americans at the outset wished the Austrian Deputies to be convened in October, but Mr. Acheson readily accepted our contention that it would be better, if possible, to get the Trieste and Italian issues out of the way if possible before going into a meeting on Austria. It was finally agreed that we should look at the international situation, particularly the situation in Trieste, some time in October, and consider the possibility of convening the Deputies in November.
VII.—Spain
56. Both M. Schuman and the Foreign Secretary made it very clear to Mr. Acheson that they regretted the recent American approaches to Spain and hoped that the Americans would not go further in their negotiations than was strictly necessary. Mr. Acheson told us that he was fully conscious of the strength of public opinion in the United Kingdom and in France on this subject. He assured us that he was trying to keep the negotiations on a minimum basis for that reason, and that there was no question of trying to bring Spain into N.A.T.O. or Western defence plans. But he pointed out that he too had to reckon with public opinion. It would have been difficult for him to justify to the United States public a refusal to negotiate for bases on grounds of principle, and it would have been unwise to yield to United Kingdom and French pressure in this matter since bitter resentment would have been caused against our two countries. He assured us that the State Department would keep us fully informed of the progress of the negotiations.
VIII.—Persia
57. On Persia, the Foreign Secretary's object was not to reach decisions; that would not have been possible in a fluid and changing situation; but rather to have a general talk with Mr. Acheson and Mr. Harriman and to explain to them personally the broad lines of our Persian policy. Mr. Morrison emphasised our conviction that it was near enough impossible to deal with Mussadeq and that the best hope lay in an early change of Government. He also made it plain that if active steps were taken to expel British subjects from Abadan it would create a very grave situation. Mr. Acheson and Mr. Harriman were both helpful, but there was inevitably a difference of emphasis between our two points of view. They were quite frank in urging us to be patient and conciliatory, and they expressed strongly the hope that we would not take any precipitate action by pressing the Shah too hard for the removal of Mussadeq or by armed intervention.
IX.—Policy towards the Satellites
58. The Americans had inserted in the agenda an item which seemed to point towards a desire on their part that we should join them in a more offensive policy towards the Satellite Governments. In the event, Mr. Acheson withdrew this item. Here, it seems, we have another proof of the moderate breeze blowing in Washington at the moment.
X.—Availability of Defence Forces
59. At Mr. Shinwell's suggestion the Defence Ministers met together at one stage during the Ottawa Conference and carried out a useful review of such matters as the speed at which reserve forces could be put into the field after D-Day, the provision of equipment and increases in the period of national service.
60. At the conclusion of their review, the Defence Ministers accepted a United Kingdom recommendation that an appreciation should be prepared for the Military Committee for subsequent submission to the next meeting of the Council in Rome of the readiness and effectiveness of the forces allocated to N.A.T.O. which would be immediately available in the event of war.
61. In addition to this appreciation, the Council called for the submission to its next meeting in Rome of an estimate of the relative strength and capabilities of the forces of N.A.T.O. and of the Soviet bloc at present and in the immediate future. This estimate may well serve as a useful background for our discussions at Rome.
XI.—Development of non-Defence Aspects of N.A.T.O.
62. At Ottawa the Americans put forward important proposals, of which they had previously given us warning, for developing the "non-defence" aspects of N.A.T.O. The suggestion tabled by Mr. Acheson was that those countries which had shown special interest in the social, economic and cultural aspects of N.A.T.O. should form a committee to make proposals for developing this side of the alliance—i.e., the implementation of Article 2 of the Treaty—which in our present preoccupation with defence plans was in danger of being side-tracked indefinitely. The origin of this plan was the realisation that many of the smaller Powers, particularly the Dutch and Scandinavians, were growing increasingly restive at their lack of influence over the major decisions of the Council and at what they felt to be unjustified "press-ganging" by the big three (this has been particularly apparent in the discussions over Turkey and Greece). The Americans were anxious therefore to mollify these countries to some extent by giving them a more prominent part to play in the affairs of N.A.T.O. The proposal received prompt support and developed into a full discussion of the wider aspects of the N.A.T. association, and an expression of our common desire to work for the long-term aim of the prosperity of the Atlantic Community as well as the short-term goal of military security.
63. In the course of this discussion, the Council drew up an important statement of faith stressing the peaceful objectives of N.A.T.O., which was released for publication. This statement announced the formation of a ministerial committee, composed of representatives of Belgium, Canada, Italy, the Netherlands and Norway, to "consider the further strengthening of the North Atlantic Community and especially the implementation of Article 2 of the North Atlantic Treaty." This committee will make recommendations to the Council for co-ordination and frequent consultation on foreign policy, particularly in regard to the promotion of peace; on cultural, economic and social co-operation within N.A.T.O. or through other agencies; and on collaboration in the fields of culture and of public information. It is understood, of course, that this body will not duplicate the work of any existing international organisations, and the Foreign Secretary uttered a warning against elaborate staffs and unnecessary expenditure.
XII.—Future Council Meetings
64. In view of the elections in this country, it was agreed to defer the next N.A.T.O. Council Meeting (in Rome) to the end of November.
65. The North Atlantic Council also unanimously decided that more ministerial meetings were essential if work was to be carried on effectively and agreed that in future there should be meetings of the Council—though not necessarily in the full conclave of 36 ministers—about three of four times a year.
Conclusions
66. Apart from the solid achievements recorded above, there are also more general conclusions to be drawn from the meetings which it may be useful to set down as pointers to the future.
67. First of all, from the point of view of Anglo-American relations, the meetings were successful in bringing our policies much closer together. This applies particularly to the Middle East. It is clear that the Americans have now reached the conclusion that our two countries can no longer afford to pursue independent policies in the Middle East and that if the whole area is to be saved for the West, they must give us their full support in Egypt and elsewhere. There are still of course a number of other questions on which our policies have still to be brought into line, chief among them the looming problem of the finance of defence, which has not really been tackled yet as something which has to be solved jointly. While some Americans pay lip-service to "burden sharing," they are really still thinking in terms of "Aid"—and even on that Congress has been extremely difficult.
68. During all our discussions Mr. Acheson impressed us as the outstanding American who is sensitive to the complex reactions of the European countries and above all understands and sympathises with our own particular approach to world problems. There was a heightened statesmanship and increased mellowness in Mr. Acheson's handling of all these matters. The popular success of the Japanese peace treaty and the enviable personal success which he had at San Francisco were no doubt partly responsible for this. After San Francisco and the President's public eulogy he clearly felt himself in a strong position. Time and again he helped us out, particularly in the very tricky negotiations with the French over the Middle East Command. Attacks on Mr. Acheson, which have become a feature of American internal politics, will doubtless revive. But so long as Mr. Acheson is at the State Department, and whatever trimming of his policies he may be forced to resort to in the face of public criticism, we can feel confident that American foreign policy will be conducted by a man who understands the British position and sympathises with the British approach to international affairs.
69. Secondly, the meetings have also resulted in a great improvement in Anglo-French relations. Our support in principle of the French plan for a European Army and our signature of the joint tripartite declaration on Germany, together with the fact that we found ourselves taking much the same line on the economic problems of defence, seem to have had quite a disproportionate effect on French opinion and to have dissipated at last the cloud which our ambiguous attitude towards European integration has recently cast over Anglo-French relations.
70. Thirdly, the Ottawa meeting showed how sensitive the smaller Atlantic Powers, particularly Holland and Denmark and Norway, have become to leadership by the three Great Powers unless exerted with more tact than the Americans habitually display. If we are effectively to maintain the Atlantic Alliance we cannot afford to ignore this small Power complex and it is therefore important that we should in future make full use of the Council Deputies as a shock absorber for their grousing and resentment at three-Power leadership.
71. Fourthly, the value of having a meeting of the Finance and Economic Ministers of the N.A.T.O. Powers was immediately apparent; it was largely due to their presence that the Council gave practical recognition for the first time to the need to take account of financial and economic possibilities and limitations. From this point of view it may be said that the attendance of Finance and Economic Ministers was overdue; however, that may be, such meetings should clearly continue to be held regularly in the future.
72. Finally, we felt that separate meetings of Defence Ministers during the course of these Conferences are of great value in reviewing the progress that has been made in the defence field, and that they should be a regular feature of Council meetings in the future.
H. M. H. G. E. S.
22nd October, 1951 CABINET
CUSTODY OF CABINET DOCUMENTS
NOTE BY THE PRIME MINISTER
It is a well-established and useful rule that members of the Government in office may not have access to the Cabinet papers of earlier Governments save by agreement between the two Prime Ministers concerned. To assist in securing compliance with this rule in the immediate future, I ask that all Ministers should forthwith return to the Cabinet Office all copies now held by them of (i) papers and minutes of the Cabinet itself, and (ii) papers and minutes of all Ministerial Cabinet Committees and other Ministerial Meetings except the following:
- Civil Defence Committee
- Commonwealth Affairs Committee
- Overseas Reconstruction Committee
- China and South-East Asia Committee
- Lord Presidents (Accommodation) Committee
The papers of the Committees listed above may be excepted from the general rule and left in the possession of Departments, since they contain little material which is likely to be the subject of political controversy.
2. I ask that Ministers should not take away with them, on relinquishing office, any Cabinet papers—whether papers of the Cabinet itself, or of Cabinet Committees or Meetings of Ministers. This request applies to the papers which a Minister submitted himself as well as to papers submitted by other Ministers.
I am satisfied that under modern conditions general compliance with this request is necessary for the purpose of ensuring the safe custody of Cabinet documents. Any former Minister may at any time have access in the Cabinet Office to copies of Cabinet or Cabinet Committee papers issued to him while he was in office; and the services of the Secretary of the Cabinet and his staff will continue to be available to former Ministers for this purpose.
C. R. A.
10, Downing Street, S.W. 1, 26th October, 1951.
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a59ec2b2ca61f9df517ca54f5cb08bc56e35d466 | Council Date: 23 April 2012
Cabinet Member Presentations
Report of the Leader of the Council Report of the Cabinet Member for Environment Report of the Cabinet Member for Community Engagement Report of the Cabinet Member for Finance Report of the Cabinet Member for Housing Report of the Cabinet Member for Regeneration, Enterprise & Planning I am pleased to inform everyone that Cllr Bottwood is now doing well having received hospital treatment following his heart attack last month. I am sure all members will join me in wishing him a full and speedy recovery and a quick return to the Guildhall.
On 26th March we announced that the Borough Council is working with Local Government Shared Services (LGSS), the organisation set up to share services between Northamptonshire County Council and Cambridgeshire County Council, to explore the potential of joining the partnership. LGSS was set up more than a year ago to provide a wide range of support services for both local authorities. Since the establishment of LGSS, the two founding authorities have saved £11 million and to join the partnership could pave the way for savings for Northampton Borough Council in administration and other back office costs. The Borough Council is at an early stage in negotiations with LGSS and no decision has yet been made over which services could be included in any sharing agreement. LGSS provides a full range of back-office services, including IT, HR, finance, property and asset management and other services.
The Northampton Alive Roadshow meetings have started with members of the Cabinet and myself going out and speaking to the public at a series of public meetings. The meetings map out how the major regeneration projects of the town fit together to attract investment, jobs and economic growth, and cover key projects like the Grosvenor/Greyfriars development, Northampton Waterside Enterprise Zone, Castle Station, St John’s and Avon Nunn Mills.
On Tuesday 13th March the Guildhall was privileged to host a meeting of the Business Innovation and Skills Select Committee. This was a real vote of confidence from the Government in the work we are doing here in Northampton to attract investment, improve skills, create jobs and improve our local economy. I was pleased to attend the celebration on 21st March at Alliston Gardens Community Centre to mark the transfer of fifteen community centres to eight different community organisations. Improved relations between this authority and community groups has facilitated this transfer, which will in turn help to secure and improve these facilities for the future.
Both the Skateboard Park at Midsummer Meadow, and the proposed University student accommodation at St Johns received planning consent on 3rd April, and construction will begin on both projects in the near future.
On 23rd March TS Laforey was formally awarded the Freedom of the Borough of Northampton. This was undoubtedly a proud day for them, but it was also a pleasure for this Council to be able to recognise their positive contribution and dedication to the town.
The Town and County Big Jubilee Picnic will take place from 12 noon to 6pm on Sunday 3rd June. The vintage-themed event will celebrate the foods, fashions and music of the Queen's 60-year reign, with the emphasis firmly on fun.
The 2012 Olympic Torch will be passing through our town on the morning of 2nd July. This is a fantastic once in a lifetime event that I hope all members of the council will attend with the public to show their support and enjoy the occasion. The Flame will start its journey through the town from Weedon Road near Gambrel Road. It will be carried into the town centre via Bridge Street, Drapery, through the Market Square, Abington Street, past the Guildhall, down Guildhall Road, on to Victoria Promenade and through Becket's Park.
To mark the 200th Anniversary of the death of Spencer Perceval, The Mayor will be laying a wreath at the statue in a short ceremony at The Guildhall at 5.15pm on 11th May 2012.
Northampton Youth Forum has been running a campaign to tackle hate crime since last summer, and have been awarded the Northamptonshire County Council and the Children and Young People's Partnership award for "Outstanding Contribution to Anti-Bullying Work", and has also recently been nominated for a National Diversity Award.
I would like to give my congratulations to everyone who received Heart of the Community Awards this year. These awards give us the opportunity to acknowledge the hard work and dedication of residents who are working hard for their communities, and represent the best of our town.
**Community Safety**
The priorities and action plan for the Community Safety Partnership 2012/13 have been agreed. Key priorities for 2012/13 are Violent Crime, Serious Acquisitive Crime, Anti-Social Behaviour & Domestic Abuse. Priority location work to tackle serious acquisitive crime and help victims of burglary in hot spot locations continues. The main focus areas are Standens Barn, Bellinge, Spencer, Kings Heath, Kingsley/Phippsville, Abington The Mounts.
Leaflets have been distributed to raise awareness of Designated Public Places Order (DPPO) in five Eastern/Central European languages to raise awareness of the Order.
A further awareness event to support the ‘Killing with Kindness’ campaign took place on the Market Square on 13th April to help raise awareness around street begging.
A further two sessions of Domestic Abuse training for front line staff has been undertaken. A total of eight sessions have been run in Northampton this year with a total of 176 staff from NBC, NCC, Northants Police and NHS receiving the training.
An Easter ‘E’ message has been circulated to all students providing crime prevention advice and personal safety information in partnership with the University of Northampton.
Our Town Centre car parks have again been recognised with the Park Mark® Safer Parking Award. The award has been renewed at 11 Northampton Borough Council car parks and shows the council is working hard to deliver safer parking. This, along with free parking and reduced parking charges in the Town Centre, is part of a wider plan to encourage shoppers into Northampton.
An awareness raising campaign to tackle issues of vehicle crime began in April 2012, focussing on theft from vehicles and vehicle security.
**Junior Wardens**
Another four schools have signed up to join the junior community wardens scheme being championed by Northampton Borough Council and Northamptonshire Police. Pupils from Greenoaks Primary, Sunnyside Primary, Vernon Terrace Primary and Woodvale Primary will be trained over the next few months to become junior community wardens and take an active role in the community. The group of 131 children are following in the footsteps of pupils from four other schools who have successfully completed the ten-week course and graduated as junior community wardens. Legal Services
The department has maintained its LEXCEL quality accreditation and achieved a 100% pass of its core requirement. The external inspector has also noted a number of areas of good practice within the service following a three-day inspection. LEXCEL is administered by the Law Society for England & Wales and is sought by many private Practice firms.
Litigation
Since 15th February 2012 the department has prosecuted or taken the following court action:
- £350 fine plus £400 costs for cigarette dropping
- Two Hygiene Emergency Prohibition Orders
- Health and Safety cases resulting in £5,000 fine to a Director and £10,000 fine to a Company.
- Two ASBOs for two years each, restricting the subject from entering a certain area in Duston and from causing harassment, alarm or distress to any person in the Borough of Northampton
- Unauthorised subletting £475 costs
- Five year ASBO to restrict entering an area and being found drinking in the street
Benefit Fraud
- Twelve month Conditional Discharge - £400 costs
- 60 hours unpaid work - £100 costs
- (s112 SSAA 1992) 80 hours Community Work and £100 costs
Commercial and Corporate
Since the last report six Right to Buy sales have been completed, three TPOs have been confirmed and eight properties have been disposed of. The Stagecoach Agreement has also been completed in connection with the Greyfriars Bus Station.
Councillor David Mackintosh Leader of the Council Environmental Services
During the month of February, over 188 tonnes of food waste were collected. Once the service has had time to bed in, figures for participation levels and tonnages collected can be more accurately assessed.
Environmental Health
Campaign posters and lamppost stickers have been going up across the town as the council’s Neighbourhood Wardens start a three-month crackdown on dog owners who do not clear up after their pets. Verbal warnings, written warnings and Fixed Penalty Notices of £80, which if not paid could lead to a fine of up to £1,000, will be handed out to those spotted not clearing up their dog’s mess. Patrols will take place in known hotspots, initially offering advice to dog walkers on the correct disposal of dog waste, to then be followed up by targeted enforcement. The campaign will also appeal to the public to report incidents and problem areas to the council so that action can be taken.
Licensing
- A driver induction course was held on 19th March and was attended by twenty applicants.
- Multi agency checks on vehicles were undertaken on 15th and 16th February and 15th and 22nd March.
- The Prince of Wales public house has withdrawn its magistrate’s court appeal in relation to its license revocation.
- The Taxi Age Limit consultation has now closed and the findings have been analysed. Final reports are being prepared to go before the Licensing Committee in early May.
- Licensing Committee informed of Governments intention to introduce changes to Licensing Act within the Police Reform and Social Responsibility Bill on April 6th (although not confirmed).
- The review and restructure of Licensing has now been completed.
Carbon Management
Around 40 representatives of small and medium sized businesses from in and around Northampton, attended an Energy Efficiency Breakfast on 1st March. This event, run in conjunction with the Carbon Trust provided straightforward advice and useful energy saving tips to help businesses reduce their carbon footprint and save money. Air Quality Management Areas
Air quality in Northampton is improving with four areas of the town where traffic pollution had exceeded target levels now well within acceptable limits. On 18th April the Air Quality Management Area (AQMAs) status of Barrack Road, Park Avenue North, A45 (Riverside) and Lumbertubs Way was considered by Cabinet.
The AQMAs were established after target levels for nitrogen dioxide, associated with traffic emissions, were exceeded. Our monitoring and assessment work has confirmed that traffic emissions and pollution levels in these four areas are now within acceptable limits. We intend to build on this and are currently developing an action plan outlining the steps we will be taking to further improve air quality in these parts of the Borough.
Councillor John Caswell Cabinet Member for the Environment Events
The 2012 Olympic Torch route was announced on the 19th March and identifies the route moving from the west of the town, through the town centre and leaving in the east via Becketts Park. The Council will be contacting and meeting with businesses and partners affected by the route.
The Council has organised meetings with school coordinators and is working with Northamptonshire County Council to ensure as many local school children as possible are able to watch this once in a lifetime opportunity.
The Torch relay is one of a number of significant events being planned for the town centre and our parks and open spaces this summer. Other national events coming to the town include Godiva Awakes, Lion Heart and Games Time, as well as regional and local events like Race 4 Life, Music Festival, Diwali, Olympic Sports and the Jubilee Party and others. We want Northampton to be the venue of choice for people to visit this summer.
The Town and County Big Jubilee Picnic will be Northampton's main Jubilee event and will take place from 12noon to 6pm on Sunday 3rd June and will begin with a short outdoor service at All Saints' Church followed by a procession to Delapre Park and Abbey. The vintage-themed event will celebrate Her majesty's reign with the foods, fashions and music of the last sixty years, and people are invited to bring along their own Jubilee or vintage-themed picnics, or to visit the Jubilee pub and food court while they enjoy six hours of fun and entertainment. The Big Jubilee Picnic has been organised by Northampton Borough Council and Northamptonshire County Council, and will be hosted by HM Lord Lieutenant of Northamptonshire, Lady Juliet Townsend LVO. The event will also be supported by a number of local partners and businesses.
The Jubilee Street Parties pack has been launched, offering advice & guidance for anyone wishing to hold their own street party. The deadline for applications is the 4th May.
Culture & Heritage
Arts Council England have confirmed £119,100 of transition funding for 2012-13. The money will be used to provide additional activity around the Cultural Olympiad ‘World at your feet’ exhibition and other business improvement initiatives. Museum
The newly refurbished Museum and Art Gallery is on target to be officially launched on 12th April, with preview tours between 4th and 11th April.
Neighbourhood Working
The current Junior Wardens programme has now concluded. The “graduation ceremony” will take place on 18th April and a new programme will start after Easter.
Joint working with the Police and Sheltered Housing has resulted in a new Sector office being established in South-West Sector at Spencer Haven following the closure of Gladstone Road.
A major public event was held in the Guildhall on 11th April to celebrate the achievements of Change of Scene participants.
Community Centres
A celebration took place to mark the transfer of 15 community centres to eight different community organisations on 21st March. The event at Alliston Gardens Community Centre saw around 40 members of management groups gathered to mark this new beginning.
The centres and their new management groups are:
- Community Spaces Northampton is managing Bellinge, Briar Hill, Kingsthorpe, Rectory Farm, Southfields, Standens Barn and Vernon Terrace community centres.
- Alliston Gardens and Semilong community centres are being managed by Alliston Gardens Youth and Community Centre.
- St James community centre is being managed by the Doddridge Centre.
- Spencer Dallington centre is being managed by Deafconnect.
- Camp Hill centre is being managed by its established management committee.
- Kings Heath centre is being managed by the Need to Know Centre Northampton.
- Abington community centre is being managed by its established management committee.
- Pastures centre is being managed by its established management committee.
Customer Services
Annual Billing for Council Tax in March is traditionally the busiest time for Customer Services staff and this years performance in relation to call handling and visitors was exceptional due to effective resource allocation and proactive planning. The Customer Services and Council Tax Teams worked seamlessly together to support customers effectively through this very busy period. Community Governance Review
The borough wide Community Governance Review (CGR) has continued through March with various community information events, including:
- Central Area Board briefing
- Community briefings at Lings Forum, the Guildhall and in the Grosvenor Centre
- Forum briefings at LGBTQ, Diverse Communities, Pensioners and Youth
- CGR briefing at Parklands Residents Association
- CGR consultation at Wootton & East Hunsbury Parish Council
Seven CGR petitions have been set up by Councillors, which are available on the Borough Council website. The deadline for petitions is 27th April 2012, and hundreds of signatures have already been received and validated against the electoral register. After the consultation has ended any proposals will be subject to a referendum and consideration by Full Council and implemented at the local elections in May 2013.
Partnership Fund
23 local charities and community groups have been given a total of £550,000 through our Partnership Fund to help them continue their positive work in our town’s communities. At this time it is more important than ever that the Borough Council supports these organisations to make our town a better place.
Northampton Leisure Trust
The Sport Relief Mile took place at Becketts Park on Sunday 25th March with over twenty Northampton Leisure Trust volunteers assisting on the day. The event was well attended with around 1,300 people taking part.
Membership sales are continuing to do well and are currently 5% up against the same time in 2011. Trilogy memberships are at an all time record high of 6796, along with swimming lesson enrolments which are at 2033.
After 3.5 years the ‘Eastfield and Spencer Sport and Physical Activity Project’ funded by Sport England and a range of partners finished in February 2012. The Project has exceeded all targets set by Sport England.
The Big Lottery funded ‘Northampton Improved Places for Play’ programme finished at the end of March 2012. The Play Development Team have exceeded all of the targets set during the 3.5 years the programme was in place and has been hailed a huge success. Northampton Borough Council, Northampton Leisure Trust and the County Sports Partnership have joined together to introduce Parkrun at the Racecourse every Saturday morning. Parkrun is a national initiative which provides weekly free 5km runs, and allows competitors to record their 5km times online and compare their times nationally.
Councillor Brandon Eldred Cabinet Member for Community Engagement Local Government Shared Services (LGSS)
Northampton Borough Council is in the early stages of negotiations with LGSS, the organisation set up to share services between Northamptonshire County Council and Cambridgeshire County Council, to explore the potential of joining the partnership.
LGSS was set up more than a year ago to provide a wide range of support services for both local authorities. Since the establishment of LGSS, the two founding authorities have saved £111 million and to join the partnership could pave the way for savings for Northampton Borough Council in administration and other back office costs.
LGSS provides a full range of back-office services, including IT, HR, finance, property and asset management and legal, and has proved that it can deliver cutting edge services in a way that enormously reduces costs and allows members to focus on frontline services.
Finance
We have now completed the financing for the buy out of the Housing Revenue account. The buy out was compulsory and as a result will mean the Council now self – finances its stock of social housing and retains the rental income collected each year. As we approach year-end we are preparing our financial management system for the production of the end of year statutory reports. These reports and other work completed during year-end will ensure we meet our statutory obligations. A meeting of Chief Finance Officers took place during the week commencing 26th March and discussed some of the Localisation reforms impacting on our financial management, and a meeting of councillors from across the county is also planned. In particular the localisation of Council Tax support, business rates retention and Council Tax discount reform were reviewed. Revenues and Benefits
During March the service successfully produced and dispatched year end Council Tax bills and benefit notifications, which involved the production and processing of over 100,000 documents. As we move towards year – end we will complete the final work required to closedown the 2011/12 financial year and prepare the system for 2012 / 13.
Work – loads within benefits increased in February and March, following the implementation of a new national system called ATLAS 2. We have already implemented the first phase of ATLAS, which saw changes to tax credits being loaded straight into our benefits system. The second phase picks up all changes to national benefits.
Duplication and early problems with the data being received requires a review in order to ascertain if a change is required. Improvements to the system are expected following the completion of year – end.
The next phase of our citizen account was completed at the beginning of March. This phase allows benefit recipients to review details of their claim online, and to review notifications electronically instead of receiving paper copies through the post. This is another step in offering the widest range of access channels to our customers and reducing costs for the Council.
We are continuing to contact and offer support to benefit recipients impacted by reductions in housing benefit. In March we sent further correspondence detailing the changes and highlighting where people need to come for help.
On 19th March a local resident was pleaded guilty at Northampton Magistrates Court to claiming over £4,000 in benefits she was not entitled to following an investigation by Northampton Borough Council's benefit fraud team. Northampton Borough Council will continue to take action against anyone who steals money intended to help the town's most vulnerable residents by cheating the system to get benefits they are not entitled to.
Facilities Management
The refurbishment of the Jeffrey Room has been completed. The new design and technology available in the Jeffrey Room will ensure that public and private meetings can run as smoothly and comfortably as possible.
Two events in March worthy of note were the visit of the Business Innovation and Skills Committee and the launch of Northampton Alive. The Councils facilities team successfully supported these high profile events. ICT
The Capital Project to upgrade Microsoft Office and Exchange has started. This is an essential upgrade to a critical piece of software which supports efficient services to our customers.
A trial of technology which supports Councillors and staff to securely access council e-mail and calendars from any smart phone has now finished. The feedback was overwhelmingly positive and the business case recommends its roll-out to support more flexible working.
The Website improvement project is underway. The team are currently reviewing website content to ensure that it is focussed on the tasks and information that our customers most often need to access.
Councillor Alan Bottwood Cabinet Member for Finance Northampton Borough Council has secured nearly £150,000 from the new Preventing Repossessions Fund to help struggling homeowners. Northampton has received the 12th largest allocation in the country, which will be used to offer small interest-free loans of less than £5,000 to those at real risk of losing their homes, or grants to help ease debt pressures and give them a chance to get back on top of their finances. The right advice and support on managing debts is crucial for homeowners who are struggling financially, and this funding will be a lifeline to those who are facing the threat of having their homes repossessed.
Empty Homes Funding
The Council has been awarded £1.9m to bring 105 empty properties back into use as affordable housing. This was the 11th highest funding awarded in the country. The programme to deliver the 105 properties will happen in stages over a three-year period from April 2012 to March 2015. Properties need to meet the criteria of being privately owned and vacant for more than six months. There are currently around 900 properties that fall into this category in Northampton.
The council is currently identifying the 105 properties suitable for the scheme and these are likely to range from flats to family houses in different areas of Northampton. Once finished, rents will be set according to the government's new Affordable Homes programme at 80% of market rents, and the properties will be allocated to people with housing needs on the council's housing register.
Property Maintenance Operatives
Following a successful pilot of Personal Desktop Assistants (PDAs) the devices are to be rolled out to all housing operatives working in voids and repairs. Use of these devices will significantly reduce the amount of paper used as all jobs would be received and completed via the device, it will also enhance customer service as we will be able to communicate and reschedule works whilst the operatives are out in the field. The devices will reduce the need for the operatives to visit the depot as frequently, as they will be able to work direct from home, reducing lost time, mileage and fuel usage which will have a positive effect on environmental issues and also lower costs.
De-pooling
The rent notices for 2012/13 were sent out to all tenants and for the first time included details about the costs of the services they receive. Housing staff worked in partnership with Contact Centre staff to deal with the anticipated queries. Less than 50 queries were initially received but there will of course continue to be queries raised about the rent and service charges throughout the year.
**Tenancy Sustainment Contract**
In order to address low-level anti-social behaviour and other less serious breaches of tenancy conditions the Council has formally adopted a Tenancy Sustainment Contract, which is believed is the first of its kind. The contract will last for a period of 6 months but may be extended by mutual consent. It allows an achievable action plan to remedy the breach, formally recorded by the caseworker and monitored at agreed intervals. The contract is voluntary. If a tenant agrees to sign the contract then they are bound by its terms and understand that if the breach is not remedied then the Council reserve the right to commence legal proceedings. The contract can be used as evidence to demonstrate that we have attempted to work with the tenant. If the tenant refuses to sign the contract then similarly this can be used in evidence if necessary at a later date. The contract will be particularly beneficial for those tenants identified as vulnerable as it would allow for the tenant to commit to regular engagement with identified support services and to set out achievable actions aimed at remedying the breach, ensuring a greater likelihood of sustaining a tenancy that may have otherwise failed.
**Consultation**
There will be extensive consultation on a number of new and revised strategies and changes to policies such as allocations and homelessness as a result of the introduction of the Localism Act.
**Mary Markham** **Cabinet Member for Housing** Town Centre Operations
In February 2012, 12,627 visitors took advantage of the one-hour free parking in our pay-on-foot multi-story car parks an increase of 2.8% in comparison with January 2012. To date around 54,000 visitors/shoppers have taken advantage of the free parking offer.
The number of visitors and shoppers taking advantage of the reduced 1 & 2 hour parking in the Town centre increased by 11.8% (in excess of 6,000 vehicles) in comparison with 2011 parking figures.
The standardisation of car parks will be introduced by late May to enable all legislative processes to be undertaken in accordance with statutory requirements.
The council continues to work closely with market traders and local businesses around the market square to help promote and build the market and Town Centre as a venue for visitors and shoppers alike.
Market Advisory Group
Raymond Everall, a well known local businessman, has been appointed as the independent chair of the Market Advisory Group.
Northampton Town Centre Limited (BID)
The BID has signed an agreement with Northamptonshire Police to provide a PCSO with specific responsibility for the BID area and the Police will provide a second PCSO to match the BID’s investment. This agreement runs from 1st April 2012 – 31st March 2013 and will be reviewed on an annual basis.
The BID has partnered with the Northampton Retail Crime Initiative (NRCI) in joint funding two Town Centre Rangers to help businesses, support visitors & shoppers and provide a more welcoming experience to the town.
The BID will be supporting new projects and initiatives in the town centre including Northampton in Bloom, Safari Northampton, Christmas, refurbishing street furniture, enhanced cleaning, marketing & promotion as well working with the Borough and County Councils on local matters. High Street Innovation Fund
On 29th March the Government announced that Northampton would be one of nine towns and cities in the East Midlands to receive £100,000 of funding for high street improvements following the Portas Review. We are working with the BID and other partners to explore the best ways of using these funds.
St James Local Development Order
On 7th March Cabinet approved the creation of a Local Development Order for the St James area of the town. The Development Order will help simplify the planning process for businesses looking to build or upgrade facilities in St James, and is a key factor in making our Enterprise Zone a success.
Delapre Abbey
Members of the public were offered the rare opportunity to look inside the Delapre Abbey on 17th and 18th March as part of a bid by the Friends of Delapre Abbey to raise donations towards its restoration, which is being led by Northampton Borough Council with support from the Friends of Delapre Abbey and the Delapre Preservation Trust.
Bus Interchange
Work has started to prepare land around the site of the proposed new bus interchange that would allow for the future development of the land. Plans for the town’s new bus interchange are due to be submitted soon. A week long exhibition to show the public how the results of the previous consultation exercise influenced the design was held in the One Stop Shop during the week commencing 16th April.
If the Planning Application is approved, the Borough Council, County Council and WNDC will have the green light to start work on a brand new bus interchange starting in the late summer.
Northampton Arts Collective vacated the Fish Market site by the due date (31 March) to enable new bus interchange proposals to come forward, and they will move into their new premises in Guildhall Road shortly. We are grateful to NAC for their co-operation throughout the process.
Delapre Bell Tower and Clock
The historic belltower and clock at Delapre Abbey has now been lifted back into place on the roof of the stable block following a full restoration programme to put the clock back into working order for the first time in 20 years. The roofing work has been carried out by local company Moulton Roofing, while the restoration of the clock and wind vane has been undertaken by specialist company Smith of Derby. Delapre Abbey is Northampton Borough Council’s key heritage project and this on-going programme of work is intended to bring more of the building back into public use as well as to safeguard it for the future.
**Abington Park Lake**
Work to fix the footpath that circles the middle boating lake in Abington Park and underpin the concrete beam that provides its supporting surround began on 26th March. For almost two years a 40-metre stretch of the path has been fenced off because of subsidence due to fluctuating water levels that has washed away some of the material under the lakeside footpaths. The Environment Agency, which has been instructing Northampton Borough Council on the project, has said that now is the best time to undertake the work, and we will be working with the both the Environment Agency and contractors to make sure that disruption is kept to a minimum.
**Planning and Regeneration**
The proposed University student accommodation at St Johns received planning consent on 3rd April. Construction is expected to commence in June/July, with completion and occupation in January 2014. This will be the first major development on site in the Waterside Enterprise Zone which came into force officially on 1st April.
The Skateboard Park at Midsummer Meadow received planning consent on the 3rd April. Construction is expected to be completed in mid-August.
Two new neighbourhood planning projects have been granted front-runner status by DCLG for Spring Boroughs and Blackthorn Good Neighbours. These projects receive £20K each to enable them to work with the Council on neighbourhood planning.
The Stage 2 transfer of planning powers from WNDC was successfully completed on 31st March. NBC now has all its planning powers back from WNDC, but will continue to work closely with the Development Corporation on the regeneration of the Town Centre.
The Northampton Alive exhibition is to be held in the Great Hall during the week commencing 23rd April. The exhibition is to show the progress on the regeneration of the Town Centre, to provide more information about the individual projects. Officers will be on hand to answer questions and provide information. Presentations at residents groups, Forums and the University have been successful in showing the overall vision for the regeneration of the town centre.
The dedication of land for St John highways infrastructure has been exchanged with the County Council. Waterside Enterprise Zone
Three expressions of interest bids for the Growing Places Fund for Enterprise Zone infrastructure and development proposals have been agreed by the SEMLEP Board to be considered at final stage in the Spring.
A marketing advisor for the Enterprise Zone has been appointed. This is an important position as high quality marketing of the Enterprise Zone will be essential to ensure the required level of inward investment.
SEMELP received an additional £6m growing places funding from central government during March. NEP also received additional funds and we are working with both to maximise the benefit for Northampton.
Councillor Tim Hadland Cabinet Member for Regeneration, Enterprise and Planning
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3915c80f5d71ced077644807f3be134fc29c0ffe | Neighbourhood Wardens
I wanted to start by thanking the Neighbourhood Wardens for their continued efforts on working with local communities and businesses in giving advice on the COVID-19 regulations. They have been working extremely hard, frequently talking to all different types of businesses ensuring compliance and taking the appropriate action whenever it has been necessary.
Environmental Services Contract
All works and services provided by Veolia and Idverde continue to be carried out in line with expectations, the current pandemic does have an impact, but workable solutions behind the scenes continue to be found to ensure that residents of Northampton see little or no disruption to these key services.
Our successful chargeable Garden waste scheme income now stands at £1,565,502, around 37273 subscriptions, approx. 53% take up from relevant properties, we are still receiving around 5-10 subscriptions per day.
Veolia’s Envirogrant scheme has attracted 14 applications, unfortunately 3 applications were received from organisations based outside of the borough so therefore ineligible which has left 11 eligible applications for consideration.
Grass Mowing services are now drawing to a close and resources switching to winter maintenance projects.
Environmental Services (Direct Services)
Parks & Open Spaces Team
An additional £50,000 Capital has been made available to improve the play areas at:
- Millers Meadow, St Andrews Road
- Auckland Close Play Area
- Exeter Place Play Area
The play areas that have already been approved for refurbishment are:
- Parklands
- The Racecourse
The major works on the embankments around the Main Lake at Abington Park have been completed, with just a few minor works to complete. This essential capital works project cost £250,000. A very wise investment to ensure the longevity of the lake in Northampton’s best known Premier Park.
The refurbishment of the Lingswood Skate Park is well under way and should be completed within the next 4 weeks. This capital project that has cost £100,000 has been very much welcomed by the young people in the areas and the local Neighbourhood Watch Group. Abington Park and Delapre Park have been successful in being re-awarded the Green Flag Award this year and in addition, Bradlaugh Fields Park was entered and has also been successful. A lot of work has been put into bringing this park up to a standard that would meet the criteria of the judges. Big thank you must go out to all the Volunteers, Community Payback, idverde and the Park Rangers for making all this possible.
Environmental Health
Staff from the food and safety and licensing teams are working hard to ensure that businesses are aware of their legal requirements under the recently updated coronavirus regulations. Patrols to monitor compliance are carried out by Wardens and officers from the team. Generally, levels of compliance are good but a small number of premises are giving cause for concern and if ongoing infringements are found appropriate enforcement action will be taken.
Councillor Mike Hallam Cabinet Member for Environment
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22189e3759971b460bc60990d742fa44ee76a4d3 | Partnership Support Over half a million pounds has been allocated by the Borough Council to support local agencies, charities and community groups that help people in Northampton. This year we have awarded partnership funding of £550,000 to 25 good causes to help them continue their work to support the town’s communities and residents.
Over the last three years this Administration has made millions of pounds available to non-profit organisations and groups that offer practical support, advice and guidance to people in Northampton. There are some really fantastic groups in Northampton who help people in need and make our local communities better. In these difficult economic times even a small grant can make a big difference in helping them continue the work they are doing do.
As well as the partnership funding allocation, Northampton Borough Council has allocated £15,000 of its small grants fund to support another seven organisations that applied.
Events People were invited to the Guildhall to make some noise on to mark the International Day Against Homophobia and Transphobia (IDAHO) on 16th May. The event was held in the Guildhall’s courtyard where people were encouraged to bring along instruments to make a minute of noise against the violence and discrimination that lesbian, gay, bisexual and transgender people experience internationally. The Mayor of Northampton, Councillor John Caswell, councillors and representatives from community groups gave short speeches to raise awareness of the day and of all those people who are unable to speak out due to homophobia, transphobia, hate crime and prejudice.
The annual open air art exhibition at Abington Park Museum opened for its 53rd year on 10th May. Art in the Park features over 70 artworks from both professional and amateur artists from across the county. There are landscapes, portraits, abstracts and still life artworks using a variety of styles and techniques, and many are available to buy. The exhibition is showing in the courtyard at Abington Park Museum until 22nd June and admission is free.
Northampton Borough Council once again ran the popular Delapre Beer Festival at Delapre Park at the end of May, after saving last year’s event from cancellation. The festival has always been very popular, and we were delighted to be able to host it again and give everyone the opportunity to enjoy Delapre Park at this fun family event. The event featured over 200 beers, 90 ciders, country wines, gin and locally sourced food as well as live music. Around 8,000 people attended last year’s festival and after receiving feedback from customers, this year’s event featured additional seating areas, a traditional band stand and improved entry systems. We were also pleased that Phipps NBC celebrated its return to brewing in the town with an exhibition stand at the event. The company has recently started brewing in Northampton again after an absence of more than four decades.
On 7th May Northampton hosted its first ever Women’s Cycling Tour in our Town Centre. It was a real privilege to be involved with this event, which attracted thousands of people into the town and helped put Northampton on the map as a venue for major sporting events.
**Culture & Heritage**
On the top floor of the Central Museum and Art Gallery the Western Front Association is showing a small but moving exhibition honouring the lives of many of the shoemakers who lost their lives in the First World War.
An exhibition showcasing innovative and intriguing work by international shoe designer, Kobi Levi, went on display at Northampton Museum & Art Gallery on 24th May. Titled ‘Kobi and the Playful World of Shoes’, the exhibition will be the first major showing in the UK, highlighting Kobi’s designs that challenge the conventional definitions of design, art and fashion, and also explore the genre of ‘extreme footwear’. The exhibition will feature hand crafted shoes designed as animals, bananas and even coffee pots, exploring how everyday items can be transformed into stylish and funny creations that can be worn or admired as art. We are delighted to be hosting Kobi’s first major exhibition in the UK, which will run until 20th June.
During the Easter holidays and May half term, daily workshops were held for young children at the Central Museum and Easter Egg hunts took place on nine days in Abington Park.
Tony Howes performed his one man adaptation of A Midsummer Night’s Dream in Abington Great Hall on 26th April and James Hornsby presented Charles Dickens’ much loved novel Great Expectations at Guildhall Road on 16th May. Performance was also a major ingredient on 1st May when an enthusiastic audience enjoyed an evening of poetry, talks and debate to complement the exhibition celebrating the 150th anniversary of the death of John Clare.
The exhibition celebrating women’s cycling - WOW – Women on Wheels has been very popular and was a great addition to the Women’s Tour which ended its first stage in Northampton on 7th May. Related events have also been very popular with over 100 attending “An evening with Hannah Barnes” on 29th April.
**Councillor Brandon Eldred**
Cabinet Member for Community Engagement
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5d05912757588cafeba3d210d7f111fb0bacee72 | Information Management Assessment
Action plan progress review
Cabinet Office
Reviewed September 2015
Published November 2015
Working with government to raise standards in information management Contents
Background 3 Progress to address recommendations and risk areas 4 Next steps 11 You may use and re-use the information featured in this report (not including logos) free of charge in any format or medium, under the terms of the Open Government Licence v3.0.
Any enquiries regarding the use and re-use of this information resource should be sent to [email protected] Background
The Information Management Assessment (IMA) programme is the best-practice model for government bodies wishing to demonstrate commitment to the principles of good information management.
The Cabinet Office IMA took place in 2013. We conducted interviews at the department’s Whitehall offices between 24 June and 8 August 2013. Cabinet Office produced a detailed action plan and we formally assessed progress against the plan in September 2015. The IMA report and action plan are published on The National Archives website.¹
This progress review summarises key developments since the 2013 IMA. Areas where continued attention is required are detailed in the ‘Next Steps’ section.
¹ http://www.nationalarchives.gov.uk/information-management/manage-information/ima/ima-reports-action-plans/ Progress to address recommendations and risk areas
1 The value of information
| Performance rating | IMA 2013 | Review 2015 | |-------------------------------------|--------------|-------------| | Communicating and realising value | Satisfactory | Satisfactory| | Managing information as an asset | Development Area | Satisfactory |
Situation at the time of the IMA
Cabinet Office had developed an Information Strategy in February 2012 which embraced a key set of information related policies and strategies, but this was not embedded in practice throughout the department. There was a lack of consistency across the department, although pockets of excellence were noted. For instance, there was no consistency in information asset ownership. Cabinet Office had recently restructured its corporate governance at the time of the IMA and following this there was some confusion over the overlap of particular roles, including the Senior Information Risk Owner and the Chief Information Officer. There was also no longer a forum for information stakeholders to discuss information management policy and issues. Cabinet Office had done some exemplary work with What to Keep schedules, but this had not yet been extended to new policy areas.
Two high-level presentations were given to, and signed off by, Cabinet Office Board which set out the vision for information management in the digital age. The presentations also set out a governance structure, the steps needed to deliver a ‘technology environment’ and a means of measuring success. Since the IMA Cabinet Office has established a network of information managers across the department. This network is being used to disseminate good practice - the core KIM team is, for instance, sending out hints and tips on good records management practice. This network is playing an important part in helping to drive consistency throughout the department.
The Assessment Team noted that further work on identifying information of value is taking place. Workflows are being put in place for each team to enable them to make decisions on ‘What to Keep’ and guidance on ‘What to Keep’ has been circulated to teams.
The Permanent Secretary has been a vocal and active supporter of the KIM agenda since the IMA. A note was circulated to all senior managers in early 2015 from the (then) Permanent Secretary stating that information management needs to be resourced properly and standards needed to improve. Following this, a league table has been introduced which shows progress against seven criteria such as whether teams are using a naming convention and whether they are saving information of value. Teams have to provide evidence to back up their scores. The core KIM team plan to write to directors setting out what they need to do to improve performance.
The planned review to assess the benefits obtained from the February 2012 information strategy has not been conducted. This review would allow Cabinet Office to learn lessons both in terms of what worked well and in identifying barriers to achievement of previous strategic goals that are still relevant today. We repeat our recommendation that it is carried out.
The Information Asset Registers are a useful tool in encouraging asset owners to value their information and also in managing risk. Cabinet Office has fully engaged with the Information Assurance and Cyber Security Engagement Programme training run by The National Archives on behalf of Cabinet Office and offered to Information Asset Owners, which is an essential step in understanding and managing risks to information assets.
In conclusion, Cabinet Office has developed its thinking and strategies for managing its records, including digital information. It now needs to continue the work started on delivering these strategies.
2 Digital information and supporting technology
| Performance rating | IMA 2013 | Review 2015 | |--------------------|-------------------|------------------------------| | Supporting information through technology | Development area | Progressing towards satisfactory | | Digital continuity and IT change | Satisfactory | Satisfactory |
Situation at the time of the IMA
Cabinet Office digital information was captured through a number of systems which were not interoperable, including two electronic records management systems and the FLEX system for highly classified information. These were in addition to shared drives and email, which were often the systems preferred by staff. Growing volumes of digital records were being stored in these systems, which had no automatic retention schedules. Cabinet Office needed to establish clear business requirements for the management of digital records.
Since the IMA, a Knowledge and Information Manager in the Major Events and Operations Group has been appointed who is working alongside Government Digital Service to deliver a technology strategy and solution for the department. In 2015 Cabinet Office introduced Google Apps to replace its EDRM, Meridio. Relevant information from shared drives and Meridio was migrated into the new system. Information Technology provision and support has been brought back in-house since the assessment. Ongoing work on Google Apps includes incorporating retention schedules which will build on the digital ‘What to Keep’ schedules that have been drawn up.
Number 10 continues to use SharePoint 2010 for digital records management. The system was working well at the time of the IMA, with good compliance.
A new Information Strategy for Cabinet Office Technology Transformation has been approved since the assessment. A major focus of this strategy and the work following on from it is the introduction of Google Apps. Google Apps is being tailored to ensure that it meets Cabinet Office needs as an electronic records management system. Google Docs is currently being piloted in a number of teams and issues addressed as they arise through these pilots. Cabinet Office should continue to work closely with The National Archives as it implements Google Apps.
3 Information risk, governance and oversight
| Performance rating | IMA 2013 | Review 2015 | |-----------------------------|-------------------|------------------------------| | Recognising information risk| Development area | Development area | | Establishing control | Satisfactory | Satisfactory | | Providing guidance | Satisfactory | Progressing towards Good practice | | Measuring impact | Satisfactory | Satisfactory | Situation at the time of the IMA
Cabinet Office demonstrated a core strength in ensuring the security of information. However, the wider information risks were not clearly defined, documented or managed. The IMA report recommended that existing structures and policies be extended to give this control and oversight. Further recommendations included the need for KIM training to be included in induction training, and that wider information-related risks be tracked and mitigated.
A statement on records management performance has been added to corporate compliance statements. It is planned that progress will also be tracked through a traffic light system. This will be an important development that will highlight levels of performance, enable consistency and drive improvement. We urge that this is progressed as a priority.
A governance structure was established that included regular reporting to the SIRO. This did lapse following internal reorganisation but a new working group has been established to support the SIRO in reviewing current activities and advising on future work. The group forms part of the wider governance for Information Management, which is led by the Permanent Secretary. The working group has the potential to provide direction for information and records management as well as information assurance. To address the gap in governance identified in our original report we recommend that records management is added to the terms of reference for this body.
Since the IMA, the role of Departmental Records Officer has been split between teams, with the creation of the new Knowledge & Information Manager in the Major Events & Operations Group. It is important that there is a joined-up approach to records management irrespective of format. A clear governance structure would achieve this.
Any new Cabinet Office project now needs to get approval from the SIRO. In each project, data protection risks are flagged. In addition, the new SIRO working group reviews risks on a regular basis. The identification of common information standards, against which performance of business areas can be measured, has allowed the department to better assess its exposure to levels of risk from records management performance. Cabinet Office is reviewing its risk appetite and this will be expanded to include information management risks. This work was put on hold pending the appointment of a new SIRO. We urge Cabinet Office to give this priority.
Information management training is now included as part of the corporate induction programme.
4 Records, review and transfer
| Performance rating | IMA 2013 | Review 2015 | |-------------------------------------|----------------|---------------| | Oversight of records and selection | Good practice | Good practice | | Implementing disposal decisions | Satisfactory | Satisfactory |
Situation at the time of the IMA
Cabinet Office was meeting its obligations under the Public Records Act. It demonstrated some good practice, for instance in holding history days to actively promote interest and understanding of its records. Paper records were well managed and the department was up to date with reviewing files ready for transfer to The National Archives. The department has worked closely with The National Archives to resource the release of records, and to meet its obligations under the 20-year rule. Cabinet Office was encouraged to maintain this level of performance by drawing up Cabinet Office has recruited additional resources in two important areas: reviewers, and updates to the inventory of information assets. This is a positive step. There is also a need to plan for future requirements, and Cabinet Office has agreed with The National Archives to draw up an in-year, resourced plan.
Cabinet Office holds many legacy digital records. There are significant challenges to address here and the Cabinet Office is working closely with The National Archives to tackle these. Issues include helping reviewers prepare for the scale and complexity of digital and hybrid records and ensuring the digital continuity of the records. Next Steps
The National Archives will continue to work closely with Cabinet Office so that the department is supported as it continues its work on information and records management. Outstanding recommendations will be reviewed at the time of the department’s IMA reassessment. It is recommended that Cabinet Office focus on the following:
- Engage with The National Archives’ Digital Transfer team to ensure that Cabinet Office is prepared for its first digital transfers.
- Review its risk register to ensure the risk of not capturing and keeping the right records is given the priority it needs.
- Enact the agreed new governance structure to oversee information management.
- Progress the introduction of the traffic light system to monitor KIM performance.
- Continue to work closely with The National Archives as Google Apps is implemented.
- Carry out a review of the 2012 strategy to ensure effective strategy can be established for the management of information in all formats in the future.
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1a545a4fe0363fcad1ad1ea4a3b6ab3b304f0a90 | | Outcome | Objective | Actions | Timeline | |---------|-----------|---------|----------| | An improved information management culture | Create the conditions and the environment within which greater knowledge sharing can be encouraged, reducing duplication and wasted effort and avoiding the repetition of mistakes. | Establish strong peer level leadership through community of practice: Information Management Leaders and Library Managers. Embed standards and expectations through staff communications and refreshed training offer for Google users. Maintain performance management of business units and report outcomes bi-annually to ExCo. Develop test models jointly with the policy and PPM professions for establishing learning and knowledge sharing before, during and after initiatives, projects, reviews, etc. | Established in 2015-16. Maintain. Established in 2015-16. Under review for re-launch in 2016-17 Report to ExCo in October 2016 and at 6 monthly intervals Develop a proposal for discussion by Q4 of 2016-17 | | Our systems and processes support our statutory obligations | Create in the department a means of capturing, evaluating, sharing, and accessing information effectively | Embed the standard departmental approach to record management, measure performance and report to ExCo. Develop and deliver a procedure for archiving, reviewing and publication of electronic records under the 20 year rule. Implement policies & procedures for working with private offices to ensure the right records are kept | Under review for re-launch in 2016-17 Operational by Q3 of 2016-17 Operational by Q3 of 2016-17 | | Technology tools are fit for purpose and facilitate and support further transformation | Identify, develop and deliver records and information management tools that support a culture change and efficient working | Complete delivery of electronic document and records management tools for handling material classified as OFFICIAL and higher Identify improved means for capturing important emails in the record | Deliver AODocs by end March 2016. Support delivery of FABRIC by April 2016. Support delivery of higher classification systems. Pilot a range of tools and approaches with a view to scaling up pilots across 2016-17 |
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32c949f72d4dc84a866388e6f03ce9e0ec7678e2 | Ofcom 2 July 2013
Senior Salary Disclosure
In addition to the salary details already published within the Ofcom Annual Report, we have chosen to make publicly available the details of all other Ofcom employees who earn more that £150k per annum in basic salary as at 31 March 2013.
| Name | Job Title | Basic Salary Band | |-----------------|-----------------------------------------------|-------------------------| | Peter Bury | Director of Spectrum Policy | £155,000 - £159,999 | | Andrea Coscelli | Economics Director | £150,000 - £154,999 | | Graham Howell | Secretary to the Corporation | £160,000 - £164,999 | | Charles Jenne | Director of Spectrum Policy | £155,000 - £159,999 | | Graham Louth | Director of Spectrum Markets | £155,000 - £159,999 | | James Thickett | Director Market Research & Market Intelligence| £150,000 - £154,999 |
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64be6ba5ab652356a99ab2389314487c22970db0 | Ofcom 2 July 2012
Senior Salary Disclosure
In addition to the salary details already published within the Ofcom Annual Report, we have chosen to make publicly available the details of all other Ofcom employees who earn more that £150k per annum in basic salary as at 31 March 2012.
| Name | Job Title | Basic Salary Band | |-----------------|-----------------------------------------------|-------------------------| | Peter Bury | Director of Spectrum Policy (Olympics) | £155,000 - £159,999 | | Charles Jenne | Director of Spectrum Policy | £150,000 - £154,999 | | Graham Howell | Secretary to the Corporation | £155,000 - £159,999 |
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56edf603c654d150049e313b2e8b92e047757012 | Ofcom 2 July 2010 Senior Salary Disclosure
In addition to the salary details already published within the Ofcom Annual Report, we have chosen to make publicly available the details of all other Ofcom employees who earn more that £150k per annum in basic salary as at 31 March 2010.
| Name | Job Title | Basic Salary Band | |--------------------|-----------------------------------------------------|-------------------------| | Peter Bury | Director of Spectrum Policy (Olympics) | £150,000 - £154,999 | | Gareth Davies | Competition Policy Director | £155,000 - £159,999 | | Graham Howell | Secretary to the Corporation & Director of England | £155,000 - £159,999 | | Charles Jenne | Director of Spectrum Policy | £150,000 - £154,999 | | Kate Stross | Director of Content | £160,000 - £164,999 | | Jonathan Thompson | Director of Strategy | £155,000 - £159,999 |
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a0d66052c98d73f3349affa33460dcf1f4138240 | 1. Introduction
1.1 Section 38 of the Localism Act 2011 requires local authorities to produce an Annual Pay Policy Statement
1.2 This Pay Policy Statement includes:
(a) the level and elements of remuneration for Chief Officers; (b) the remuneration of the lowest paid employees; (c) the pay differential, known as the ‘pay multiple’ between the remuneration of Chief Officers and other officers and (d) other aspects of Chief Officer remuneration, fees and charges and other discretionary payments
2. Principles
2.1 Blaby District Council recognises that, in the context of managing scarce resources, remuneration at all levels needs to be adequate to secure high quality employees who provide excellent services to the public, yet at the same time needs to avoid being unnecessarily generous or otherwise excessive. This pay policy sets out how the Council determines pay decisions across all aspects of pay and provides a framework to assist council Members in determining a pay strategy in a fair and equitable way within the council’s Medium Term Financial Strategy.
2.2 The Public Sector Equality Duty also requires the Council to develop and publish a policy on how it is meeting its duty, having due regard to the need to eliminate unlawful discrimination particularly in relation to employment and pay. The council supports the principle of equal opportunities in employment and acknowledges that men and women should receive equal pay for the same or broadly similar work, for work rated as equivalent and for work of equal value. This Pay Policy sets out the Council’s approach in ensuring equality of pay in line with those legal requirements.
2.3 It is important that local authorities are able to determine their own pay structures in order to address local priorities and to compete in the local labour market.
3. Scope
3.1 The policy covers all staff employed by the Council irrespective of grade and conditions of service. It will have reference to national agreements which affect pay and grading including:
- National Agreement on Pay and Conditions of Service (the Green book, for all staff below Head of Service)
4. Remuneration of senior officers
4.1 In this policy the senior pay group refers to posts within the top three tiers of the organisation. These include the Chief Executive Officer, (1) Directors (2) and Chief Officers (7).
4.2 Chief Executive
4.2.1 The Chief Executive is the head of the council’s paid service. The salary paid to the Chief Executive (this excludes Returning Officer fees which are paid separately) is approved by full Council at the time of appointment.
4.2.2 The current salary range for the Chief Executive is £87,892 - £100,000 per annum; the range contains 5 increments and is subject to annual cost of living increases agreed by the Joint National Council (JNC). This is a local grade which was established in 2011, following an analysis of the degree of responsibility in the role, benchmarking with other comparators and the ability to recruit and retain an exceptional candidate.
4.2.3 The Chief Executive Remuneration Panel, which comprises of the elected leader and the leaders of the opposition groups, determines incremental pay progression on an annual basis with the potential to increase one point every year subject to agreed priorities being met. The current Chief Executive is currently on point 5 of a 5 point scale.
4.2.4 Other conditions of service are as prescribed by the JNC for Local Authority Chief Executives national conditions.
4.3 Directors and Group Managers
4.3.1 The pay and grading for the Directors and Group Managers are evaluated using a local evaluation scheme. Its methodology reviews current job information including: job descriptions, staff structure including lines of accountability and capital and revenue budget responsibility. This information is used to determine the value of the job size and comparison with other Councils.
4.3.2 The grades are as follows:
| Role | Salary Range | |-----------------|------------------| | Directors | £66,329 - £77,809| | Group Managers | £45,367 - £62,030|
4.3.3 These salaries are subject to annual cost of living increases agreed by Joint Negotiating Committee for Chief Officers. Other conditions of service are as prescribed by the JNC for Local Authority Chief Officers. 4.4 Other allowances
4.4.1 The Council operates an essential car user scheme in accordance with JNC handbook.
4.4.2 Fees are payable for Returning Officer duties which are not part of the post holder’s substantive role. Whilst appointed by the council, the role of the Returning Officer is one which involves and incurs personal responsibility and accountability and is statutorily separate from his/her duties as an employee of the council. Returning Officer fees are variable and paid based upon the number of electors per election. The Returning Officer for the council is the Chief Executive.
4.4.3 For any Chief Officer who undertakes duties that have been procured by another local authority, a discretionary payment (honorarium) will be made following an assessment of the additional time that the Chief Officer will spend in carrying out these additional duties.
4.4.4 There are two additional proper officer appointments within the Council, that of S151 Officer and the Monitoring Officer. Both of these are currently carried out by Chief Officers who receive additional responsibility allowances.
4.4.5 There are no other additional elements of remuneration in respect of: overtime, bank holiday working, standby payments etc. paid to senior staff as they are expected to undertake duties outside their contractual hours and working patterns without additional payment.
5. Pay Structure
5.1 The current pay structure (Grades 1-9) applies to all employees excluding the senior pay group. Salaries within the pay spine are subject to pay awards as agreed by the National Agreement on Pay and Conditions of Service (NJC). From 1 October 2015 the lowest paid employee will be paid at spinal point 6 within Scale 1 at a full time equivalent basic pay rate of £13,614 per annum.
5.2 All posts are evaluated using the NJC Job Evaluation Scheme, which is recognized by public sector employers and unions nationally. This scheme allows for robust measurement against set criteria resulting in fair and objective evaluations and ensures equal pay.
5.3 Progression within the grade for all staff takes place annually on 1 April, with the exception of newly appointed employees with start dates between November and March, who will receive their first increment six months after their start date. Any subsequent increments will then occur on 1 April in line with all other employees.
5.4 The grading structure aims to meet the current and/or market position for most jobs. At certain times some types of jobs are very scarce either because of national shortages or high demand for certain skills. 5.5 Employees who are on spinal column point 10 or below will also receive an additional supplement which ensures they are paid at the Living Wage rate as of 31 October 2015. This rate is set independently by the National Living Wage Foundation (part of the Citizens UK charity and is not to be confused with the forthcoming National Living Wage which is due to be introduced on 1 April 2016) is calculated according to the basic cost of living in the UK, and its aim is to ensure that people in work and their families can achieve a standard of living which is free from poverty. The rate as of 31 October 2015 stood at £7.85 per hour (or £15,100 per annum).
5.6 This Living Wage supplement will be paid in addition to the employees current pay rate and as they move up the spinal column points range, their supplement will be amended so that their total pay equates to this Living Wage rate. The supplement will then cease once the employee progresses to the pay point which is above that of the Living Wage (currently spinal column point 11). The Living Wage supplements will remain applicable until 31 March 2016.
6. Other allowances
6.1 NJC employees may claim allowances which may be locally and nationally agreed in the course of their work duties. A list of typical allowances that employees can claim is set out at Appendix B.
7. Pension Arrangements
7.1 All employees of the council, irrespective of pay group, are entitled to join the Local Government Pension Scheme. The table below sets out the varied rates that employees are required to contribute based upon their whole time salary.
The employee contribution rates for 2015/16 are below:
| Actual Pensionable Pay | Gross contribution rate | |------------------------|-------------------------| | Up to £13,600 | 5.5% | | £13,601 to £21,200 | 5.8% | | £21,201 to £34,400 | 6.5% | | £34,401 to £43,500 | 6.8% | | £43,501 to £60,700 | 8.5% | | £60,701 to £86,000 | 9.9% | | Salary Range | Contribution | |----------------------|--------------| | £86,001 to £101,200 | 10.5% | | £101,201 to £151,800 | 11.4% | | More than £151,801 | 12.5% |
The council, as an employer, currently contributes 17.1% of the employee’s basic salary plus a overall flat rate cash contribution of £222,000 to the fund.
8. **Multipliers**
8.1 Publishing the pay ratio of the organisation’s top earner to that of its lowest paid earner and median earner has been recommended to support the principles of Fair Pay (Will Hutton, 2011) and transparency.
8.2 In the context of the council’s payroll the Chief Executive, who is the top earner in the Council, currently earns £100,000 per annum. This is 4.02 times the average earnings in the Council, 4.64 times the median earnings and 6.60 times the lowest earner.
8.3 The multipliers will be monitored each year as part of the review of the Pay Policy Statement.
9.0 **Severance Payments**
9.1 The council operates a voluntary severance scheme which is applicable to all employees of the Council. The scheme applies to:
- Redundancy
- Voluntary early retirement
9.2 **Redundancy**
Redundancy payments are payable to Employees, who are dismissed on the grounds of redundancy and who have at least two years' continuous employment at the date of termination of employment. Redundancy payments use an actual week's pay (annual salary divided by 52 pro rata’d as appropriate) or the statutory capped figure, whichever is the higher.
9.3 **Early Retirement – efficiency grounds**
Employees who will be 55 or more and have at least 2 years' pensionable service in the Local Government Pension Scheme (LGPS) may retire early upon entering into a formal agreement with the Council which will include a mutually agreed retirement date, where it is considered to be in the interests of the efficient exercise of the Council’s functions. The employee will not receive a severance payment or additional year's service but will have access to the pension scheme. The capital cost of early payment of pension benefits is subject to approval by Council.
9.4 Flexible Retirement
An employee who is a member of the LGPS and 55 years or over may request, with the Council's consent, to reduce their hours and/or grade and make an election to the administering authority for payment of their accrued benefits without having retired from employment. However, the council will only agree to release pension where there is no capital cost to the authority.
10. Re-employment/engagement of senior managers
10.1 Where a senior manager, as defined under paragraph 4.1, has left the authority on redundancy or early retirement grounds, the authority will not normally re-employ at a later stage or re-engage the former employee as a consultant.
11. Decision Making
11.1 Decisions on remuneration are made as follows:
(a) Chief Executive local pay structure approved by full Council (b) Performance progression of Chief Executive approved by Chief Executives Remuneration Panel (c) Pay structure for Directors and Chief Officers posts approved by full Council
## BLABY DISTRICT COUNCIL SALARY SCALES
### 1 OCTOBER 2015
| Scale 1 | Scale 2 | Scale 3 | |----------|----------|----------| | (0-279) | (280-379)| (380-428)| | S.P. | £ | S.P. | £ | S.P. | £ | | 6 | 15,144 | 12 | 15,523 | 18 | 17,714 | | 7 | 15,144 | 13 | 15,941 | 19 | 18,376 | | 8 | 15,144 | 14 | 16,231 | 20 | 19,048 | | 9 | 15,144 | 15 | 16,572 | 21 | 19,742 | | 10 | 15,144 | 16 | 16,969 | 22 | 20,253 | | 11 | 15,207 | 17 | 17,372 | | |
| Scale 4 | Scale 5 | Scale 6 | |----------|----------|----------| | (429-468)| (469-554)| (555-609)| | S.P. | £ | S.P. | £ | S.P. | £ | | 23 | 20,849 | 28 | 24,472 | 35 | 30,178 | | 24 | 21,530 | 29 | 25,440 | 36 | 30,978 | | 25 | 22,212 | 30 | 26,293 | 37 | 31,846 | | 26 | 22,937 | 31 | 27,123 | 38 | 32,778 | | 27 | 23,698 | 32 | 27,924 | 39 | 33,857 | | | | 33 | 28,746 | | | | | | 34 | 29,558 | | |
| Scale 7 | Scale 8 | Scale 9 | |----------|----------|----------| | (610-639)| (640-654)| (655-669)| | S.P. | £ | S.P. | £ | S.P. | £ | | 39 | 33,857 | 43 | 37,483 | 48 | 42,053 | | 40 | 34,746 | 44 | 38,405 | 49 | 42,957 | | 41 | 35,662 | 45 | 39,267 | | | | 42 | 36,571 | 46 | 40,217 | | | | 43 | 37,483 | 47 | 41,140 | | |
### Chief Officers
| Scale 10 | Scale 11 | Scale 12 | |----------|----------|----------| | (670-689) | (690-710) | (711 - ) | | S.P. £ | S.P. £ | S.P. £ | | A 45,367 | A 49,388 | A 54,897 | | B 48,720 | B 52,953 | B 58,463 | | C 62,030 | | C 62,030 |
### Directors
| Scale 13 | Scale 14 | |----------|----------| | S.P. £ | S.P. £ | | A £66,329 | A £74,139 | | B £68,380 | B £77,809 | | C £71,980 | |
### Chief Executive
| Scale 15 | |----------| | S.P. £ | | A £87,892 | | B £91,727 | | C £95,151 | | D £98,575 | | E £100,000 | Appendix B
Local Allowances – NJC Staff
Saturday and Sunday Working:
If weekend working is not part of a normal working week (that is regular rostered weekend working) then the following payments apply.
Saturday - Time and half Sunday - Time and half if basic pay above SCP 11 Double time if basic pay at or below SCP 11
If weekend working is part of a normal working week then plain time rates apply unless part of an approved overtime arrangements in which circumstance overtime rates will apply.
Additional Hours and Overtime Payments
Employees, on or below SCP 34, and required to work additional hours beyond a full 37 hour week (or average 37 hour week) are entitled to receive time and half for additional hours worked Monday to Saturday and double time for additional hours worked on a Sunday.
Part time workers are entitled to these enhancements only after a 37-hour week (or average 37 hour week) is exceeded, although rostered work on a Saturday and Sunday will attract the overtime allowance.
For employees on or above SCP 35 enhanced rates will not be paid. In exceptional circumstances the Head of Service may agree that overtime at plain time rates may be paid in order to clear backlogs or catch up on projects. In normal circumstance employees are expected to accrue and bank approved additional hours as time off in lieu. Managers have a responsibility under health and safety legislation to ensure that excessive hours are not worked and that accumulated TOIL is taken on a regular basis.
Overtime payments are full settlement and are not enhanced by any other allowance e.g. a shift allowance that is paid on normal working hours.
Public and Extra Statutory Days
Employees required to work on a public or extra statutory day shall be paid at plain time for all hours worked within their normal working hours for that day. In addition, time off with pay shall be allowed as follows: Less than half normal hours worked – half day More than half normal hour’s worked – full day
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f6e6b18a842980c1b0cf1961450b4619d69ee735 | As Accounting Officer, you are responsible for making sure your department is meeting its obligations in relation to copyright. You must ensure that any work created by your department is compliant with copyright law.
What is meant by copyright?
Copyright is an intellectual property right that protects original material people create.
Original works include charts, images, reports, guidance documents, websites and blog posts. Original copyright works automatically qualify for copyright protection upon creation.
Copyright is sometimes shown by using the copyright symbol © but even material without the symbol can be protected by copyright.
Civil servants and copyright
All civil servants have a responsibility to respect copyright. You have an obligation to ensure that your staff are aware of their responsibilities before using material created by others. They must:
- identify who the copyright holder is, and ask for permission to re-use the work on behalf of HMG, in print and in electronic form, throughout the world for the duration of the copyright
- acknowledge the copyright holder once permission has been granted (if they have asked to be acknowledged). This is usually done by including a line of text giving them credit for their material
- never use pictures, text or images without the permission of the copyright holder unless the material is available under an open licence. This is especially important for all civil servants because they are representing HMG
If you are relying on an exception to copyright to re-use material created by a non-Crown employee, you should consult Intellectual Property Office guidance to ensure this re-use is lawful.
Open Government Licence
All material produced by civil servants at work belongs to the Crown. The default licence for Crown copyright is the Open Government Licence.
Crown copyright is legally defined under section 163 of the Copyright, Designs and Patents Act 1988 as ‘works made by officers or servants of the Crown in the course of their duties.’ Crown copyright covers material created by civil servants, ministers and government departments and agencies. This includes legislation, government codes of practice, Ordnance Survey mapping, government reports, official press releases, government forms and many public records. Material made available under the Open Government Licence means that you are free to:
- Copy, publish, distribute and transmit the information
- Adapt the information
- Exploit the information commercially and non-commercially, i.e. by combining it with other information (your own product or application)
This means you can use other civil servants’ work and it makes information OPEN, ACCESSIBLE and REUSEABLE for all.
If you wish to use any images or text that are not made available under OGL you must make sure you have permission from the copyright holder. This includes information you find on the internet.
**Why should I care about it?**
- It’s the law. If copyright material is re-used without permission of the copyright owner, it constitutes an infringement. Under UK law, copyright infringement is a civil offence and legal proceedings can be commenced
- There is significant risk to the reputation of your department, and to you personally, if you fail to comply with copyright
- The re-use and adaptation of available information can save your department time, money and resources
**What do I need to know?**
- Copyright is an intellectual property right
- You need permission to use material you find online
- The OGL means anyone can use and re-use your work
- Always acknowledge the copyright holder
**What do I need to do?**
- Lead by example and always show respect for copyright
- Ensure there is clear accountability among staff and that compliance is being managed and reported
- Ensure staff are aware of their responsibilities relating to copyright
- Ensure copyright is a central consideration when creating and re-using information
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0fdf92530060421f86f75f6bcdbdac0faccea296 | A YEAR IN ARCHIVES 2017 People and institutions trust in the authenticity of archive records, and how they are preserved and presented.
Building trust in collections through diversity of records
Diverse archive collections hold the key to widening participation and representing all sections of society. What archives choose to hold has to complement and challenge more formal historical records and give voice to people that are often invisible or silent in records.
It is refreshing to see the commitment of institutions like the Bishopsgate Institute, University of Bristol and London Metropolitan Archives (LMA) to doing just that.
The Bishopsgate Institute was the first to put out a call for people to deposit material from the women’s march in January 2017 with them. Its long tradition of collecting materials from London protests and campaigns (including two of the largest demonstrations in British history; the National Reform League demonstration 1866 and the Stop the War demonstration 2003) is pivotal in representing often marginalised people and events.
Funded by the Heritage Lottery Fund, Speak Out London, Diversity City is a community-led LGBTQ+ oral history project based at LMA that has focused on collecting information about everyday lives from 1945 to the present. The records include a new and significant contemporary archive of oral histories and ephemera, representing often marginalised sections of society.
The University of Bristol Special Collections went into overdrive, asking people to collect and send them the election leaflets which come through their door for all 650 Westminster Constituencies, covering over 3,000 candidates. This allows future generations to have an insight into the political landscape and manifestos.
It is projects like these that enhance links with the community and a sense of ownership, ensuring that no one in society is left out of our history.
THE THINKING BEHIND OUR COLLECTING IS TO ALLOW FUTURE GENERATIONS TO UNDERSTAND HOW DEMOCRACY AND SOCIETY ARE STRENGTHENED BY THE COLLECTING OF ARCHIVE RECORDS.
STEFAN DICKERS, LIBRARY SPECIAL COLLECTIONS MANAGER, BISHOPSGATE INSTITUTE Archives enhance and enrich our society intellectually, culturally and economically.
Graffiti and archives may sound like a strange combination, but the success of the Strong Rooms project, an outdoor, touring art installation, was a significant milestone for the newly-launched Archives West Midlands last summer.
Supported by Arts Connect West Midlands and funded by Arts Council England, the project presented archives in a totally different way.
Birmingham-born street artist Mohammed Ali MBE of Soul City Arts was commissioned to develop a new archives-inspired work to tour venues in Coventry, Dudley, Rugby and Worcester. Mohammed is well-known for fusing street art with Islamic script and patterns to convey meaningful messages connecting people of all faiths.
The two graffitied shipping containers spent a week at each venue. Artists were commissioned to engage with community groups at each location, talking about the installation. The tour was supported by volunteers and staff from the key partners: Warwickshire County Record Office, Culture Coventry Trust, Dudley Archives and Local Studies, and Worcestershire Archives and Archaeology Service.
Nearly 8,000 people participated directly, most of whom were completely new to archives. The installation was viewed by 40,000 passers-by. Coverage by Midlands Today, radio and local newspapers reached more than three million people. This project clearly demonstrated the huge appetite for large-scale interaction and the value of presenting collections in a creative way.
It also showed how necessary it is to come out of our comfort zone and take our archives out to the people.
SAM COLLENETTE, TRUSTEE, ARCHIVES WEST MIDLANDS Archives cultivate an open approach to knowledge and are accessible to all.
Opening Worcestershire archives to overseas audiences
Family history is popular all over the world, but those undertaking research in far-flung countries do not always engage with archives in the UK.
The collections held at Worcestershire Archive and Archaeology Service are certainly helpful for overseas users researching their Worcestershire ancestors and the places they came from, but remote customers were not the target audience of the services website when it was originally designed. It was therefore not surprising that, in the Archives and Records Associations Distance User Survey results for 2015, overseas enquiries represented only 6% of those who responded to Worcestershires survey.
These results led the archive to investigate ways in which they could reach out to the overseas research community and explore new ways of presenting information and services to those who are unlikely to visit in person.
The result was the publication of an information guide which walks customers through the most-used collections, including wills, trade directories, electoral registers, census, maps and church records. Each section explains the records and provides links for the customer to find out further information from catalogues, guides and indexes on the website.
This guide has been designed by Connecting Element, a Birmingham-based digital marketing company, and is being sold as a downloadable PDF via the website explorethepast.co.uk.
If successful, this is a model that could be easily adopted by other archive services, helping the sector as a whole to widen our audience.
Lisa Snook, Worcestershire Archive and Archaeology Service Our biggest challenge is creating and sustaining archives in the digital age.
READ project to tell us more about Jeremy Bentham
As part of University College Londons Bentham Project, an interdisciplinary enterprise to produce a new scholarly edition of the works and correspondence of the legal philosopher Jeremy Bentham, academics at the university partnered with the Linnean Society of London on a Handwritten Text Recognition (HTR) programme.
Funded by the European Commission, the READ (Recognition and Enrichment of Archival Documents) project uses developing technologies to enable computers to read and search handwritten documents through a process of machine learning. Given the sheer diversity of handwriting, from different styles to uncommon abbreviations, technology needs to be trained to understand such complexities.
Through the Transkribus platform, (transkribus.eu), users can upload digital images of manuscript pages and supply a short transcription. The Transkribus team then generates an HTR model for the collection, with a possible accuracy rate of 95%. By supplying the platform with images of the manuscript collections of Carl Linnaeus (1707,1778), the Linnean Society is helping further refine the HTR software through their use of a collection which features Linnaeus, notoriously poor handwriting in Swedish and Latin. UCL then hopes to utilise the HTR software in their efforts to transcribe and make available Benthams writings.
The two organisations have also worked together by holding a joint event, asking archivists, librarians, researchers and other heritage professionals about their digital toolbox, in the hopes of encouraging more archives to use HTR software to make their collections digitally accessible.
HANDWRITTEN TEXT RECOGNITION TECHNOLOGY COULD POTENTIALLY REVOLUTIONISE THE WAY MEMBERS OF THE PUBLIC ACCESS HISTORICAL RECORDS.
DR LOUISE SEAWARD, RESEARCH ASSOCIATE, BENTHAM PROJECT, UCL RESILIENCE
We are building the sectors capacity to meet future challenges.
The South West Heritage Trust has negotiated a brighter future for the North Devon Record Office.
A consortium of councils and community support now helps to fund a service which is focusing on outreach and developing volunteer opportunities.
This partnership has been the result of a shared wish to create an innovative and cost-effective archive service for North Devon. The region has a strong local identity but is geographically isolated, so there was a widespread desire to keep and enhance the local service.
Facilities have been transformed, with a refreshed search room, improved strong room facilities, new IT system and bespoke photographic store. New engagement opportunities are being developed and it is hoped that there is now a long-term future for this service, which will celebrate its 30th anniversary in 2018.
North Devon is a testament to how forming partnerships with local communities and organisations can transform services at risk and give them a sustainable future, contributing to bringing greater benefits to the surrounding area and its people.
THE NORTH DEVON RECORD OFFICE IS A VITAL PART OF LIFE IN THE NORTH OF THE COUNTY. WE GREATLY VALUE OUR HERITAGE AND IT IS IMPORTANT THAT IT REMAINS ACCESSIBLE IN NORTH DEVON. OVER 30 TOWN AND PARISH COUNCILS, AND OTHER ORGANISATIONS ACROSS NORTHERN DEVON, HAVE WORKED WITH THE SOUTH WEST HERITAGE TRUST AND DEVON COUNTY COUNCIL TO MAKE THIS POSSIBLE.
WILL AUSTIN, CLERK, BARNSTAPLE TOWN COUNCIL We need to demonstrate the impact of archives on society.
Unilever is part of our local and global business heritage. Every day, two billion people use a Unilever product.
Archive staff within Unilevers Global Marketing and Communication function are prominent in sourcing material from Unilevers extensive archive holdings. By providing copies of original archive material, the team are able to help the company raise revenue through licensing opportunities, as well as ensuring that its brand and company heritage are promoted and used in the best way.
Claire Tunstall, Head of Art, Archives and Records Management at Unilever, knows the huge impact her team is making on a regular basis. A clear example includes a time when Claires team was approached by the Global Marketing Manager for Ponds Unilever Asia (Singapore), with a request for copies of a particular oral care television commercial from 2001, showing a whitening shade card in use. They were facing a challenge from a major competitor on the use of the shade card in a new market, Unilever needed evidence showing it was the first to use this innovation. Most of the staff at Unilever involved in the launch of the shade card had moved on to other roles, and so the brand team were finding it difficult to locate documentation surrounding it. Claires team searched their database of records and found an advert that was broadcast in Morocco in 2001, it clearly showed the use of a whitening shade card.
The business in that market was worth 15,000,000 Euros at the time, and Unilever stood to lose 10 to 20% of their market share if the challenge from their competitor proved successful. The archive collection was vital in influencing this significant commercial outcome; Unilevers Global Marketing Manager informed Claires team that he could not imagine how he could have obtained this evidence without their help.
Few organisations can boast the wealth of material and history that we have here at our fingertips. The work of the archives is not just about the past but to help us better face our future.
WILL AUSTIN, CLERK, BARNSTAPLE TOWN COUNCIL A Year in Archives 2017 brings together stories from organisations across the country, showcasing the fantastic work happening in the sector.
2017 was an important year for us at The National Archives. With the support of The Department for Digital, Culture, Media & Sport ministers, we launched our strategic vision for the archives sector. The ambition of Archives Unlocked is to release the full potential of archives. Archives should inspire trust, enrich our lives, and be open to all. In order to do this, we are focusing on key areas of opportunity and challenge for the sector: increasing digital capacity, building resilience and demonstrating impact. Our case studies show how much archives are doing already to realise these goals.
People may think archives are about the past but these stories show that archives are about the future. We want to show the innovative ways archives work to collect, and to make their collections accessible, for now and for the future.
Isobel Hunter Head of Archives Sector Development
As Chief Executive and Keeper, I see first-hand how the archives sector is innovating, and engaging people with their collections and services, reinforcing why archives matter for individuals and society.
Jeff James, Chief Executive and Keeper, The National Archives
©Crown copyright 2017. To view this licence visit nationalarchives.gov.uk/doc/open-government-licence
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ef171e8de4ddfb8c98b4be4e6b436f3f3d16395f | Building trust in collections through diversity of records
Diverse archive collections hold the key to widening participation and representing all sections of society. What archives choose to hold has to complement and challenge more formal historical records and give voice to people that are often invisible or silent in records.
It is refreshing to see the commitment of institutions like the Bishopsgate Institute, University of Bristol and London Metropolitan Archives (LMA) to doing just that.
The Bishopsgate Institute was the first to put out a call for people to deposit material from the women’s march in January 2017 with them. Its long tradition of collecting materials from London protests and campaigns (including two of the largest demonstrations in British history; the National Reform League demonstration 1866 and the Stop the War demonstration 2003) is pivotal in representing often marginalised people and events.
Funded by the Heritage Lottery Fund, Speak Out London – Diversity City is a community-led LGBTQ+ oral history project based at LMA that has focused on collecting information about everyday lives from 1945 to the present. The records include a new and significant contemporary archive of oral histories and ephemera, representing often marginalised sections of society.
The University of Bristol Special Collections went into overdrive, asking people to collect and send them the election leaflets which come through their door for all 650 Westminster Constituencies, covering over 3,000 candidates. This allows future generations to have an insight into the political landscape and manifestos.
It is projects like these that enhance links with the community and a sense of ownership, ensuring that no one in society is left out of our history.
“THE THINKING BEHIND OUR COLLECTING IS TO ALLOW FUTURE GENERATIONS TO UNDERSTAND HOW DEMOCRACY AND SOCIETY ARE STRENGTHENED BY THE COLLECTING OF ARCHIVE RECORDS.”
STEFAN DICKERS, LIBRARY SPECIAL COLLECTIONS MANAGER, BISHOPSGATE INSTITUTE Graffiti and archives may sound like a strange combination, but the success of the Strong Rooms project – an outdoor, touring art installation – was a significant milestone for the newly-launched Archives West Midlands last summer.
Supported by Arts Connect West Midlands and funded by Arts Council England, the project presented archives in a totally different way.
Birmingham-born street artist Mohammed Ali MBE of Soul City Arts was commissioned to develop a new archives-inspired work to tour venues in Coventry, Dudley, Rugby and Worcester. Mohammed is well-known for fusing street art with Islamic script and patterns to convey meaningful messages connecting people of all faiths.
The two graffitied shipping containers spent a week at each venue. Artists were commissioned to engage with community groups at each location, talking about the installation. The tour was supported by volunteers and staff from the key partners: Warwickshire County Record Office, Culture Coventry Trust, Dudley Archives and Local Studies, and Worcestershire Archives and Archaeology Service.
Nearly 8,000 people participated directly, most of whom were completely new to archives. The installation was viewed by 40,000 passers-by. Coverage by Midlands Today, radio and local newspapers reached more than three million people. This project clearly demonstrated the huge appetite for large-scale interaction and the value of presenting collections in a creative way.
“IT ALSO SHOWED HOW NECESSARY IT IS TO COME OUT OF OUR COMFORT ZONE AND TAKE OUR ARCHIVES OUT TO THE PEOPLE.”
SAM COLLENETTE, TRUSTEE, ARCHIVES WEST MIDLANDS Opening Worcestershire archives to overseas audiences
Family history is popular all over the world, but those undertaking research in far-flung countries do not always engage with archives in the UK.
The collections held at Worcestershire Archive and Archaeology Service are certainly helpful for overseas users researching their Worcestershire ancestors and the places they came from, but remote customers were not the target audience of the service’s website when it was originally designed. It was therefore not surprising that, in the Archives and Records Association’s Distance User Survey results for 2015, overseas enquiries represented only 6% of those who responded to Worcestershire’s survey.
These results led the archive to investigate ways in which they could reach out to the overseas research community and explore new ways of presenting information and services to those who are unlikely to visit in person.
The result was the publication of an information guide which walks customers through the most-used collections, including wills, trade directories, electoral registers, census, maps and church records. Each section explains the records and provides links for the customer to find out further information from catalogues, guides and indexes on the website.
This guide has been designed by Connecting Element, a Birmingham-based digital marketing company, and is being sold as a downloadable PDF via the website explorethepast.co.uk.
“IF SUCCESSFUL, THIS IS A MODEL THAT COULD BE EASILY ADOPTED BY OTHER ARCHIVE SERVICES, HELPING THE SECTOR AS A WHOLE TO WIDEN OUR AUDIENCE.”
LISA SNOOK, WORCESTERSHIRE ARCHIVE AND ARCHAEOLOGY SERVICE READ project to tell us more about Jeremy Bentham
As part of University College London’s Bentham Project – an interdisciplinary enterprise to produce a new scholarly edition of the works and correspondence of the legal philosopher Jeremy Bentham – academics at the university partnered with the Linnean Society of London on a Handwritten Text Recognition (HTR) programme.
Funded by the European Commission, the READ (Recognition and Enrichment of Archival Documents) project uses developing technologies to enable computers to read and search handwritten documents through a process of machine learning. Given the sheer diversity of handwriting, from different styles to uncommon abbreviations, technology needs to be trained to understand such complexities.
Through the Transkribus platform, (transkribus.eu), users can upload digital images of manuscript pages and supply a short transcription. The Transkribus team then generates an HTR model for the collection, with a possible accuracy rate of 95%. By supplying the platform with images of the manuscript collections of Carl Linnaeus (1707-1778), the Linnean Society is helping further refine the HTR software through their use of a collection which features Linnaeus’ “notoriously poor” handwriting in Swedish and Latin. UCL then hopes to utilise the HTR software in their efforts to transcribe and make available Bentham’s writings.
The two organisations have also worked together by holding a joint event, asking archivists, librarians, researchers and other heritage professionals about their ‘digital toolbox,’ in the hopes of encouraging more archives to use HTR software to make their collections digitally accessible.
“HANDWRITTEN TEXT RECOGNITION TECHNOLOGY COULD POTENTIALLY REVOLUTIONISE THE WAY MEMBERS OF THE PUBLIC ACCESS HISTORICAL RECORDS.”
DR LOUISE SEAWARD, RESEARCH ASSOCIATE, BENTHAM PROJECT, UCL The South West Heritage Trust has negotiated a brighter future for the North Devon Record Office
A consortium of councils and community support now helps to fund a service which is focusing on outreach and developing volunteer opportunities.
This partnership has been the result of a shared wish to create an innovative and cost-effective archive service for North Devon. The region has a strong local identity but is geographically isolated, so there was a widespread desire to keep and enhance the local service.
Facilities have been transformed, with a refreshed search room, improved strong room facilities, new IT system and bespoke photographic store. New engagement opportunities are being developed and it is hoped that there is now a long-term future for this service, which will celebrate its 30th anniversary in 2018.
North Devon is a testament to how forming partnerships with local communities and organisations can transform services at risk and give them a sustainable future, contributing to bringing greater benefits to the surrounding area and its people.
“THE NORTH DEVON RECORD OFFICE IS A VITAL PART OF LIFE IN THE NORTH OF THE COUNTY. WE GREATLY VALUE OUR HERITAGE AND IT IS IMPORTANT THAT IT REMAINS ACCESSIBLE IN NORTH DEVON. OVER 30 TOWN AND PARISH COUNCILS, AND OTHER ORGANISATIONS ACROSS NORTHERN DEVON, HAVE WORKED WITH THE SOUTH WEST HERITAGE TRUST AND DEVON COUNTY COUNCIL TO MAKE THIS POSSIBLE.”
WILL AUSTIN, CLERK, BARNSTAPLE TOWN COUNCIL We need to demonstrate the impact of archives on society.
Image credit: Image kind permission of Unilever
Unilever is part of our local and global business heritage. Every day, two billion people use a Unilever product.
Archive staff within Unilever’s Global Marketing and Communication function are prominent in sourcing material from Unilever’s extensive archive holdings. By providing copies of original archive material, the team are able to help the company raise revenue through licensing opportunities, as well as ensuring that its brand and company heritage are promoted and used in the best way.
Claire Tunstall, Head of Art, Archives and Records Management at Unilever, knows the huge impact her team is making on a regular basis. A clear example includes a time when Claire’s team was approached by the Global Marketing Manager for Pond’s Unilever Asia (Singapore), with a request for copies of a particular oral care television commercial from 2001, showing a whitening shade card in use. They were facing a challenge from a major competitor on the use of the shade card in a new market – Unilever needed evidence showing it was the first to use this innovation.
Most of the staff at Unilever involved in the launch of the shade card had moved on to other roles, and so the brand team were finding it difficult to locate documentation surrounding it. Claire’s team searched their database of records and found an advert that was broadcast in Morocco in 2001 – it clearly showed the use of a whitening shade card.
The business in that market was worth €15,000,000 at the time, and Unilever stood to lose 10 to 20% of their market share if the challenge from their competitor proved successful. The archive collection was vital in influencing this significant commercial outcome; Unilever’s Global Marketing Manager informed Claire’s team that he could not imagine how he could have obtained this evidence without their help.
“FEW ORGANISATIONS CAN BOAST THE WEALTH OF MATERIAL AND HISTORY THAT WE HAVE HERE AT OUR FINGERTIPS. THE WORK OF THE ARCHIVES IS NOT JUST ABOUT THE PAST BUT TO HELP US BETTER FACE OUR FUTURE.”
PAUL POLMAN, CEO, UNILEVER 2017 was an important year for us at The National Archives. With the support of The Department for Digital, Culture, Media & Sport ministers, we launched our strategic vision for the archives sector. The ambition of Archives Unlocked is to release the full potential of archives. Archives should inspire trust, enrich our lives, and be open to all. In order to do this, we are focusing on key areas of opportunity and challenge for the sector: increasing digital capacity, building resilience and demonstrating impact. Our case studies show how much archives are doing already to realise these goals.
People may think archives are about the past but these stories show that archives are about the future. We want to show the innovative ways archives work to collect, and to make their collections accessible – for now and for the future.
Isobel Hunter Head of Archives Sector Development
“AS CHIEF EXECUTIVE AND KEEPER, I SEE FIRST-HAND HOW THE ARCHIVES SECTOR IS INNOVATING, AND ENGAGING PEOPLE WITH THEIR COLLECTIONS AND SERVICES, REINFORCING WHY ARCHIVES MATTER FOR INDIVIDUALS AND SOCIETY.”
JEFF JAMES, CHIEF EXECUTIVE AND KEEPER, THE NATIONAL ARCHIVES
©Crown copyright 2017. To view this licence visit nationalarchives.gov.uk/doc/open-government-licence
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9ea63f873b956619b6d390bcdf23bb8f83db591e | A YEAR IN ARCHIVES 2018 Democracy and society are strengthened by scrutiny of the archival record, holding institutions and individuals to account.
Gloucestershire Archives have completed an 18-month project to appraise and catalogue the records of Gloucestershire County Council, focusing on records created by the Social Services and Education departments. The project developed against the national background of historic abuse enquiries, and the council seeking reassurance that they were responding appropriately to these investigations.
Following a voluntary examination of the council’s record-keeping practices relating to the safeguarding of children and the handling of historic abuse allegations, Gloucestershire Archives was able to secure additional corporate funding towards cataloguing these records. Two of the services most experienced archivists worked in tandem on the project for 18 months, utilising their extensive experience of Gloucestershires corporate structure, and surveying over 5,000 files. Records relating to the care of children were prioritised and catalogued, while existing catalogue descriptions were enhanced, and new descriptions were created for previously uncatalogued material. This cataloguing framework can now be utilised across the council’s corporate record collections, allowing for future efficiency and accuracy when describing these records. Consistent closure periods were also established and applied across the collections. The project helped to establish exactly what Social Service and Education records have survived, and has highlighted gaps in collections. In the future, knowledge of these gaps will help to inform the ongoing development of collections.
Because of the project, full catalogue descriptions are now available and comprehensive administrative histories compiled for institutions, organisations and services. This has enabled the council to demonstrate the extent of their historic administrative responsibilities, identifying those institutions that were, and were not, responsible for in the past. Gloucestershire County Council now have a comprehensive and accurate resource that they can use effectively when responding to historic abuse enquiries.
The project has enabled Gloucestershire County Council to speak with authority as to their children’s care records.
Heather Forbes, Head of Archives Service, Gloucestershire County Council Archives enhance and enrich our society intellectually, culturally and economically.
As part of ongoing collections development work, Cheshire Archives and Local Studies realised that their collections did not sufficiently capture and document the lives of ordinary people across the county from the 1950s onwards. This was particularly true of records documenting lesbian, gay, bisexual and transgender (LGBT) lives. For example, although the Chester section of the Campaign for Homosexual Equality was one of the most active, and despite the groups origins in North West England, relatively few of these records have survived locally.
As well as a public appeal for documents reflecting LGBT histories to address gaps in collections, the service has been involved in a Heritage Lottery funded project From Prejudice to Pride led by Body Positive Cheshire and North Wales, a charity working for and with people who want to improve their sexual health, sexuality or those living with HIV. From Prejudice to Pride resulted in the organisation depositing their records with the service, a research guide and an exhibition at Weaver Hall Museum, the first time that archives had been used to celebrate LGBT lives locally. The project also involved knowledge exchange with Silver Rainbows, Body Positives network for the older LGBT community. Following oral history training, the group interviewed one another to collect testimonies that will help the service to include voices that were previously missing from the stories told by Cheshires collections.
The annual Take Pride in Ageing conference for health and social care service providers across the North West celebrated the achievements of the project and archive staff were on hand to promote the value of archives. They were able to suggest records that could remind the community of past LGBT venues and spaces in Chester for reminiscence work, allowing future health and social care initiatives to be more inclusive and reflective of different life experiences.
"From Prejudice to Pride has helped to unlock a treasure trove of stories and hidden histories, highlighting an incredible past of activism and celebrating Cheshires LGBT communities."
Claire Mooney, Patron, Silver Rainbows Archives cultivate an open approach to knowledge and are accessible to all.
Tower Hamlets Local History Library and Archives developed the Womens Hall project in partnership with four organisations: Four Corners, Alternative Arts, The East End Womens Museum and Numbi Arts. Named after the East London Federation of Suffragettes (ELFS) former headquarters in Bow, the Womens Hall went beyond the famous individuals of the movement by exploring lesser-known suffrage stories from East London.
The project featured two exhibitions and a series of weekly events based on the inclusive and proactive work of the suffragettes. Events included banner-making activities, a workshop on delivering activist speeches and a talk about Indian suffragettes, which provided a different perspective and resonated with new audiences. The events were supported by 95 volunteers and were free of charge to ensure that everyone could participate.
The community spirit and support demonstrated by the suffragettes was central to the Womens Hall and so collaborating organisations created events inspired by the federations welfare initiatives. While fighting for working womens rights during the First World War, the East London suffragettes had opened a toy factory with a creche so that working-class mothers could earn a living. In honour of this, Four Corners funded childcare for women to attend a photography skills workshop and to share their stories. Tower Hamlets Archives replicated a suffragette cost-price restaurant by opening a pay-what-you-can cafe and serving over 500 meals. Run in collaboration with Fare Share, a food redistribution charity, the cafe drew attention to the ongoing issue of food poverty in East London and fostered a welcoming atmosphere. Before visiting the cafe, many new visitors toured the services exhibition about ELFS and discovered that the service kept records of their ancestors, encouraging new relationships with the collections to grow.
It has been such a joy to honour the memory of the East London Federation of Suffragettes with our own activism. Some people living in modern day East London still struggle to afford food and childcare or find work, and we have provided opportunities on all scores.
Lauren Sweeney, Volunteer Manager, The Womens Hall, Tower Hamlets Local History Library & Archives Creating and sustaining archives in the digital age.
As the world’s largest human rights organisation, with more than 700 staff across 20 international offices, Amnesty International has been at the forefront of the fight against human rights abuses worldwide since 1961. The organisation’s activities range from observing the 1962 trial of Nelson Mandela to its current work advocating for justice on behalf of the Rohingya in Myanmar. The archive of Amnesty’s International Secretariat provides a service to staff regardless of their location or time zone, but despite their global focus, the service faces similar challenges to many others, in responding to changing digital technologies and increasing amounts of digital data.
For Amnesty, digital evidence collected by its researchers and campaigners comes in many different forms, from snippets of YouTube videos to tweets and satellite footage. Protecting, preserving and ensuring the authenticity and integrity of these records is of the utmost importance, as it allows Amnesty to hold governments and organisations accountable for their actions, while supporting communities and individuals affected by human rights violations.
The service was already using Axiell’s Calm software and SharePoint to manage and catalogue records but required a solution that would integrate these platforms into a full digital preservation solution. Responding to this challenge, archivist Bryony Hooper is building a global digital repository, using Preservica’s Enterprise Private Cloud platform. This repository will allow Amnesty to retain and ingest content of enduring value, allowing staff worldwide to access records that they need in order to present evidence to international bodies and human rights stakeholders, and to contribute to campaigning activities. Metadata enrichment will improve the efficiency of searching across collections, opening up access to Amnesty’s digitised and born-digital archives, and allowing staff the opportunity to learn more about the organisation’s history and how it can be used to further the cause of human rights for all.
“Digital evidence can come in all shapes and sizes. By providing a search platform, we can enable staff to discover relevant resources while maintaining appropriate access rights to sensitive data.”
Bryony Hooper, Archivist, Amnesty International Evaluating different service delivery models for archives and fostering innovative approaches.
Wolverhampton City Archives (WCA) partnered with Black Country Visual Arts (BCVA) to collect, digitise, and provide access to more than 2000 photographs of Wolverhampton’s Sikh community as part of the Apna Heritage Archive, supported by the Heritage Lottery Fund.
BCVA brought together family photographs and memorabilia relating to Punjabi migration to Wolverhampton between 1960 and 1989, leading to the development of a community archive space at the Guru Teg Bahadur Gurdwara in Wolverhampton, where the collections are stored and made available. WCA supported the project from the outset, providing advice on preservation and digitisation of the original material, leading to the deposit of the digitised material. Children from a primary school, where around 50 percent of the school population is of Punjabi origin, visited WCA, and created their own school archive, developing heritage research skills. This enabled WCA to document and establish strong links with a large, yet previously under-represented, community in their collections: the Punjabi community are around 15 percent of Wolverhampton’s population, totalling some 40,000 people, the second largest population of Punjabis in the country. The project culminated in an exhibition at Wolverhampton Art Gallery, which proved so popular that it was extended by two weeks.
Since participating in the project, BCVA have used their experience to advocate and offer advice to a wide range of community groups on the practicalities and benefits of working with archive services, encouraging community engagement with collections. The interest generated by the project enabled them to strengthen their advisory board, recruiting local stakeholders and academics who now play an active role in widening engagement and developing future projects. As well as generating opportunities for further art-focused projects, BCVA was recently awarded funds by the British Council for a three-week tour of India, talking about the project at universities and photographic festivals.
I went to the City Archives and stood in front of 30,000 images of Wolverhampton. I asked how many were from the South Asian community, and there were none.
Anand Chhabra, Director, Black Country Visual Arts Ensuring the full value of archives is recognised.
The National Fairground and Circus Archive (NFCA) holds more than 150,000 images and thousands more items relating to travelling entertainment. Following the donation of the Circus Friends Association Archive in 2016, the NFCA began looking for new ways to introduce these collections to the public, with the 250th anniversary of the modern circus in 2018 providing the perfect opportunity.
The service developed a broad programme of events, including the exhibition Circus Performers, Extraordinary Feats from Ordinary People at the services home at the University of Sheffield Library. The NFCA also participated in the universitys Festival of the Mind, where the public were invited to an aerial performance inspired by research into female body image and the archive collections.
Expanding the reach of the collections, the service worked closely with Museums Sheffield, Tyne and Wear Archives & Museums, and Norfolk Museum Service to conserve and loan material for three exhibitions, Circus! Show of Shows. The different exhibition spaces used records from the service to explore the histories of black and female circus artists, the changing attitudes towards animal performances, and the enduring impact of the circus in global culture.
The NFCA also collaborated with the childrens charity Artfelt by hanging colourful circus posters in the local paediatric hospital. This offered a new audience the chance to enjoy archive collections while brightening their environment. Recognising the value of engaging broad audiences, the service has also brought collections out to other communities at Weston Park and Sheffield Fayres, sparking conversations with people unfamiliar with the NFCAs work and leading to an increase in visitors to the service. The NFCA plans to continue exploring opportunities like these in the future, developing new audiences to recognise the impact of archives.
We have been delighted to share our unique collections with new audiences this year and build networks that mean we can continue to expand our reach.
Angela Haighton, Head of the National Fairground and Circus Archive, The University of Sheffield A Year in Archives 2018 brings together stories from organisations across the country, celebrating the innovative and exciting work happening in the sector.
2018 was another successful year for the archives sector, and notable for the ways in which the sector has embraced and delivered on the themes of the strategic vision, Archives Unlocked. The ambition of Archives Unlocked is to release the full potential of archives, demonstrating how archives can inspire trust, enrich our lives and be open to all. These stories reflect these ambitions, illustrating how our vibrant sector is embracing current challenges and opportunities, from building digital capacity and resilience to demonstrating impact, driving forward the many benefits of archives to different audiences.
As we continue to build the platform for future success, A Year in Archives demonstrates that the archives sector continues to work hard in demonstrating the importance of archives through innovative ways of collecting and making collections accessible, preserving our past for the future.
Dr Valerie Johnson Director of Research and Collections, The National Archives.
I am always inspired by the range of activity across the sector which demonstrates how the impact of archives is felt right across society, underpinning academic research, fuelling the digital economy and inspiring innovation and creativity. In short: archives matter!
Jeff James, Chief Executive and Keeper, The National Archives
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dee25adb1b424a248f7c40f379c912772e79cc41 | Democracy and society are strengthened by scrutiny of the archival record, holding institutions and individuals to account.
Gloucestershire Archives have completed an 18-month project to appraise and catalogue the records of Gloucestershire County Council, focusing on records created by the Social Services and Education departments. The project developed against the national background of historic abuse enquiries, and the council seeking reassurance that they were responding appropriately to these investigations.
Following a voluntary examination of the council’s record-keeping practices relating to the safeguarding of children and the handling of historic abuse allegations, Gloucestershire Archives was able to secure additional corporate funding towards cataloguing these records. Two of the service’s most experienced archivists worked in tandem on the project for 18 months, utilising their extensive experience of Gloucestershire’s corporate structure, and surveying over 5,000 files. Records relating to the care of children were prioritised and catalogued, while existing catalogue descriptions were enhanced, and new descriptions were created for previously uncatalogued material. This cataloguing framework can now be utilised across the council’s corporate record collections, allowing for future efficiency and accuracy when describing these records. Consistent closure periods were also established and applied across the collections. The project helped to establish exactly what Social Service and Education records have survived, and has highlighted gaps in collections. In the future, knowledge of these gaps will help to inform the ongoing development of collections.
Because of the project, full catalogue descriptions are now available and comprehensive administrative histories compiled for institutions, organisations and services. This has enabled the council to demonstrate the extent of their historic administrative responsibilities, identifying those institutions that were, and were not, responsible for in the past. Gloucestershire County Council now have a comprehensive and accurate resource that they can use effectively when responding to historic abuse enquiries.
The project has enabled Gloucestershire County Council to speak with authority as to their children’s care records.
Heather Forbes, Head of Archives Service, Gloucestershire County Council Archives enhance and enrich our society intellectually, culturally and economically.
As part of ongoing collections development work, Cheshire Archives and Local Studies realised that their collections did not sufficiently capture and document the lives of ordinary people across the county from the 1950s onwards. This was particularly true of records documenting lesbian, gay, bisexual and transgender (LGBT) lives. For example, although the Chester section of the Campaign for Homosexual Equality was one of the most active, and despite the group’s origins in North West England, relatively few of these records have survived locally.
As well as a public appeal for documents reflecting LGBT histories to address gaps in collections, the service has been involved in a Heritage Lottery funded project ‘From Prejudice to Pride’ led by Body Positive Cheshire and North Wales, a charity working for and with people who want to improve their sexual health, sexuality or those living with HIV. ‘From Prejudice to Pride’ resulted in the organisation depositing their records with the service, a research guide and an exhibition at Weaver Hall Museum, the first time that archives had been used to celebrate LGBT lives locally. The project also involved knowledge exchange with Silver Rainbows, Body Positive’s network for the older LGBT community. Following oral history training, the group interviewed one another to collect testimonies that will help the service to include voices that were previously missing from the stories told by Cheshire’s collections.
The annual ‘Take Pride in Ageing’ conference for health and social care service providers across the North West celebrated the achievements of the project and archive staff were on hand to promote the value of archives. They were able to suggest records that could remind the community of past LGBT venues and spaces in Chester for reminiscence work, allowing future health and social care initiatives to be more inclusive and reflective of different life experiences.
From Prejudice to Pride has helped to unlock a treasure trove of stories and hidden histories, highlighting an incredible past of activism and celebrating Cheshire’s LGBT communities.
Claire Mooney, Patron, Silver Rainbows Archives cultivate an open approach to knowledge and are accessible to all.
Tower Hamlets Local History Library and Archives developed the Women’s Hall project in partnership with four organisations: Four Corners, Alternative Arts, The East End Women’s Museum and Numbi Arts. Named after the East London Federation of Suffragettes’ (ELFS) former headquarters in Bow, the Women’s Hall went beyond the famous individuals of the movement by exploring lesser-known suffrage stories from East London.
The project featured two exhibitions and a series of weekly events based on the inclusive and proactive work of the suffragettes. Events included banner-making activities, a workshop on delivering activist speeches and a talk about Indian suffragettes, which provided a different perspective and resonated with new audiences. The events were supported by 95 volunteers and were free of charge to ensure that everyone could participate.
The community spirit and support demonstrated by the suffragettes was central to the Women’s Hall and so collaborating organisations created events inspired by the federation’s welfare initiatives. While fighting for working women’s rights during the First World War, the East London suffragettes had opened a toy factory with a crèche so that working-class mothers could earn a living. In honour of this, Four Corners funded childcare for women to attend a photography skills workshop and to share their stories. Tower Hamlets Archives replicated a suffragette cost-price restaurant by opening a pay-what-you-can café and serving over 500 meals. Run in collaboration with Fare Share, a food redistribution charity, the café drew attention to the ongoing issue of food poverty in East London and fostered a welcoming atmosphere. Before visiting the café, many new visitors toured the service’s exhibition about ELFS and discovered that the service kept records of their ancestors, encouraging new relationships with the collections to grow.
It has been such a joy to honour the memory of the East London Federation of Suffragettes with our own activism. Some people living in modern day East London still struggle to afford food and childcare or find work, and we have provided opportunities on all scores.
Lauren Sweeney, Volunteer Manager, The Women’s Hall, Tower Hamlets Local History Library & Archives Creating and sustaining archives in the digital age.
As the world’s largest human rights organisation, with more than 700 staff across 20 international offices, Amnesty International has been at the forefront of the fight against human rights abuses worldwide since 1961. The organisation’s activities range from observing the 1962 trial of Nelson Mandela to its current work advocating for justice on behalf of the Rohingya in Myanmar. The archive of Amnesty’s International Secretariat provides a service to staff regardless of their location or time zone, but despite their global focus, the service faces similar challenges to many others, in responding to changing digital technologies and increasing amounts digital data.
For Amnesty, digital evidence collected by its researchers and campaigners comes in many different forms, from snippets of YouTube videos to tweets and satellite footage. Protecting, preserving and ensuring the authenticity and integrity of these records is of the utmost importance, as it allows Amnesty to hold governments and organisations accountable for their actions, while supporting communities and individuals affected by human rights violations.
The service was already using Axiell’s Calm software and SharePoint to manage and catalogue records but required a solution that would integrate these platforms into a full digital preservation solution. Responding to this challenge, archivist Bryony Hooper is building a global digital repository, using Preservica’s Enterprise Private Cloud platform. This repository will allow Amnesty to retain and ingest content of enduring value, allowing staff worldwide to access records that they need in order to present evidence to international bodies and human rights stakeholders, and to contribute to campaigning activities. Metadata enrichment will improve the efficiency of searching across collections, opening up access to Amnesty’s digitised and born-digital archives, and allowing staff the opportunity to learn more about the organisation’s history and how it can be used to further the cause of human rights for all.
Digital evidence can come in all shapes and sizes. By providing a search platform, we can enable staff to discover relevant resources while maintaining appropriate access rights to sensitive data.
Bryony Hooper, Archivist, Amnesty International Evaluating different service delivery models for archives and fostering innovative approaches.
Wolverhampton City Archives (WCA) partnered with Black Country Visual Arts (BCVA) to collect, digitise, and provide access to more than 2000 photographs of Wolverhampton’s Sikh community as part of the Apna Heritage Archive, supported by the Heritage Lottery Fund.
BCVA brought together family photographs and memorabilia relating to Punjabi migration to Wolverhampton between 1960 and 1989, leading to the development of a community archive space at the Guru Teg Bahadur Gurdwara in Wolverhampton, where the collections are stored and made available. WCA supported the project from the outset, providing advice on preservation and digitisation of the original material, leading to the deposit of the digitised material. Children from a primary school, where around 50 percent of the school population is of Punjabi origin, visited WCA, and created their own school archive, developing heritage research skills. This enabled WCA to document and establish strong links with a large, yet previously under-represented, community in their collections: the Punjabi community are around 15 percent of Wolverhampton’s population, totalling some 40,000 people, the second largest population of Punjabis in the country. The project culminated in an exhibition at Wolverhampton Art Gallery, which proved so popular that it was extended by two weeks.
Since participating in the project, BCVA have used their experience to advocate and offer advice to a wide range of community groups on the practicalities and benefits of working with archive services, encouraging community engagement with collections. The interest generated by the project enabled them to strengthen their advisory board, recruiting local stakeholders and academics who now play an active role in widening engagement and developing future projects. As well as generating opportunities for further art-focused projects, BCVA was recently awarded funds by the British Council for a three-week tour of India, talking about the project at universities and photographic festivals.
I went to the City Archives and stood in front of 30,000 images of Wolverhampton. I asked how many were from the South Asian community, and there were none.
Anand Chhabra, Director, Black Country Visual Arts Ensuring the full value of archives is recognised.
The National Fairground and Circus Archive (NFCA) holds more than 150,000 images and thousands more items relating to travelling entertainment. Following the donation of the Circus Friends Association Archive in 2016, the NFCA began looking for new ways to introduce these collections to the public, with the 250th anniversary of the modern circus in 2018 providing the perfect opportunity.
The service developed a broad programme of events, including the exhibition ‘Circus Performers: Extraordinary Feats from Ordinary People’ at the service’s home at the University of Sheffield Library. The NFCA also participated in the university’s Festival of the Mind, where the public were invited to an aerial performance inspired by research into female body image and the archive collections.
Expanding the reach of the collections, the service worked closely with Museums Sheffield, Tyne and Wear Archives & Museums, and Norfolk Museum Service to conserve and loan material for three exhibitions, ‘Circus! Show of Shows’. The different exhibition spaces used records from the service to explore the histories of black and female circus artists, the changing attitudes towards animal performances, and the enduring impact of the circus in global culture.
The NFCA also collaborated with the children’s charity Artfelt by hanging colourful circus posters in the local paediatric hospital. This offered a new audience the chance to enjoy archive collections while brightening their environment. Recognising the value of engaging broad audiences, the service has also brought collections out to other communities at Weston Park and Sheffield Fayres, sparking conversations with people unfamiliar with the NFCA’s work and leading to an increase in visitors to the service. The NFCA plans to continue exploring opportunities like these in the future, developing new audiences to recognise the impact of archives.
We’ve been delighted to share our unique collections with new audiences this year and build networks that mean we can continue to expand our reach.
Angela Haighton, Head of the National Fairground and Circus Archive, The University of Sheffield A Year in Archives 2018 brings together stories from organisations across the country, celebrating the innovative and exciting work happening in the sector.
2018 was another successful year for the archives sector, and notable for the ways in which the sector has embraced and delivered on the themes of the strategic vision, Archives Unlocked. The ambition of Archives Unlocked is to release the full potential of archives, demonstrating how archives can inspire trust, enrich our lives and be open to all. These stories reflect these ambitions, illustrating how our vibrant sector is embracing current challenges and opportunities, from building digital capacity and resilience to demonstrating impact, driving forward the many benefits of archives to different audiences.
As we continue to build the platform for future success, A Year in Archives demonstrates that the archives sector continues to work hard in demonstrating the importance of archives through innovative ways of collecting and making collections accessible, preserving our past for the future.
Dr Valerie Johnson Director of Research and Collections, The National Archives
I am always inspired by the range of activity across the sector which demonstrates how the impact of archives is felt right across society, underpinning academic research, fuelling the digital economy and inspiring innovation and creativity. In short: archives matter!
Jeff James, Chief Executive and Keeper, The National Archives
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f1eef41f5bcb6f359dbdcc308506eb8fce0c40e1 | Natural Resources Wales permitting decisions
Mills Poultry Limited (Cefnau Bach) Decision Document Contents
New bespoke permit/Variation ................................................................. 4 The application number/the permit/variation number is: .......................... 4 The applicant/operator is: ........................................................................ 4 The Installation is located at: .................................................................... 4 Purpose of this document ........................................................................ 5 Key issues of the decision ......................................................................... 6 Receipt of application ................................................................................ 6 Confidential information .......................................................................... 6 Identifying confidential information ......................................................... 6 Consultation ............................................................................................ 6 Operator .................................................................................................. 7 The facility .............................................................................................. 7 European Directives .................................................................................. 8 The site ...................................................................................................... 8 Site condition report ................................................................................ 8 Biodiversity, Heritage, Landscape and Nature Conservation .................... 8 Environmental Risk Assessment ................................................................ 9 Air .......................................................................................................... 9 Water .................................................................................................... 11 Soil ....................................................................................................... 12 Odour .................................................................................................... 12 Noise ..................................................................................................... 14 Fugitive emissions .................................................................................. 14 Monitoring ............................................................................................. 15 Reporting ............................................................................................... 16 Operating techniques ................................................................................ 16 The permit conditions ............................................................................... 17 Updating permit conditions during consolidation. Error! Bookmark not defined. Use of conditions other than those from the template ............................... 17 Raw materials ....................................................................................... 17 Waste types ........................................................................................... 17 Conditions where the consent of another person is needed. .................... 18 Incorporating the application .................................................................. 18 Operator Competence .............................................................................. 18 Environment management system .......................................................... 18 Technical competence ........................................................................................................ 18 Relevant convictions ........................................................................................................ 18 Financial provision .......................................................................................................... 18 OPRA.............................................................................................................................. Error! Bookmark not defined. ANNEX 1: Pre-Operational Conditions ........................................................................ Error! Bookmark not defined. ANNEX 2: Improvement Conditions .............................................................................. Error! Bookmark not defined. ANNEX 3: Consultation Responses ................................................................................ 19 A) Advertising and Consultation on the Application ...................................................... 19
1. Consultation Responses from Statutory and Non-Statutory Bodies ....................... 19
2. Consultation Responses from Members of the Public and Community Organisations ................................................................................................................................. 19 a) Representations from Local MP, Assembly Member (AM), Councillors and Parish / Town / Community Councils ................................................................................................................................. 19 b) Representations from Community and Other Organisations .............................. 19 c) Representations from Individual Members of the Public .................................. 19 New bespoke permit
The application number is: PAN-001358
The applicant/operator is: Mills Poultry Limited
The Installation is located at: Cefnau Bach, Llangadfan, Welshpool, Powys, SY21 0QA
We have decided to grant the permit for Cefnau Bach operated by Mills Poultry Limited.
We consider in reaching that decision we have taken into account all relevant considerations and legal requirements and that the permit will ensure that the appropriate level of environmental protection is provided.
The permit is to operate an installation which is subject principally to the Industrial Emissions Directive (IED). The permit contains many conditions taken from our standard Environmental Permit template including the relevant Annexes. We developed these conditions in consultation with industry, having regard to the legal requirements of the Environmental Permitting Regulations (EPR) and other relevant legislation. This document does not therefore include an explanation for these standard conditions. Where they are included in the permit, we have considered the application and accepted the details are sufficient and satisfactory to make the standard conditions appropriate.
Regulated activities can present different types of risk to the environment. These include odour, noise and vibration, accidents, fugitive emissions to air and water, as well as point source releases to air, discharges to ground or groundwater, global warming potential and generation of waste. For an installation of this kind, the principal emissions are ammonia, dust, odour, noise and effluent discharges.
The facility will comprise of four poultry houses with 250,000 places designed for rearing chickens for meat production. Birds will be brought in from a hatchery and are transported to a processing plant at the end of the growing period. The average cycle length is 49 days. The four poultry houses will be built of steel, with a steel roof and sited on a concrete base, which will overlie a visqueen membrane. All ventilation will be provided by high velocity ridge fans and side inlets. The site has been used for general agriculture particularly grazing stock.
**Purpose of this document**
This decision document:
- explains how the application has been determined
- provides a record of the decision-making process
- shows how all relevant factors have been taken into account
- justifies the specific conditions in the permit other than those in our generic permit template.
Unless the decision document specifies otherwise we have accepted the applicant’s proposals. Key issues of the decision
Receipt of application The application was received on 9th March 2017, making the duly making assessment deadline 30th March 2017. The duly making assessment was carried out on 16th March 2017, and it was determined that the application could not be duly made at that point because the registered office address stated on application form Part A did not match that on Companies House, and the incorrect fee had been paid for the application. The applicant clarified the correct registered office address to NRW via email on the 16th March 2017, and the additional fee required was paid on 22nd March 2017. The application was therefore considered duly made on 22nd March 2017. This means that we considered it was in the correct form and contained sufficient information for us to begin our determination, but not that it necessarily contained all the information we would need to complete that determination. The statutory deadline for determining the application was 22nd July 2017. However, as a result of additional time requested and taken by the operator to provide information relating to ammonia emissions, the statutory deadline for determining the application was extended by 34 days from 22nd July 2017 to 25th August 2017 (see section on Air). Also, as a result of a request for an extension to the determination period by NRW, the statutory deadline was then extended again by 6 weeks from 25th August 2017 to 6th October 2017.
Confidential information No claim for commercial or industrial confidentiality has been made.
Identifying confidential information We have not identified information provided as part of the application that we consider to be confidential. The decision was taken in accordance with our guidance on commercial confidentiality.
Consultation The consultation requirements were identified and implemented. The decision was taken in accordance with RGN 6 High Profile Sites, our Public Participation Statement (PPS) and our Working Together Agreements (WTAs). A copy of the Application and all other documents relevant to our determination (see below) are available for the public to view. Anyone wishing to see these documents could arrange for copies to be made.
We sent copies of the Application to the following bodies, which includes those with whom we have “Working Together Agreements”:
- Powys County Council Planning Authority
- Powys County Council Environmental Protection Department
- Powys Teaching Health Board
- Public Health Wales
These are bodies whose expertise, democratic accountability and/or local knowledge make it appropriate for us to seek their views directly.
The consultation started on 6th April 2017 and ended on 5th May 2017. An advert was also placed on our website.
Further details along with a summary of consultation comments and our response to the representations we received can be found in Annex 1. We have taken all relevant representations into consideration in reaching our determination.
**Operator**
We are satisfied that the applicant (now the operator) is the person who will have control over the operation of the facility after the grant of the permit. The decision was taken in accordance with EPR RGN 1 Understanding the meaning of operator.
**The facility**
The regulated facility is an installation which comprises the following activities listed in Part 1 of Schedule 1 to the EPR and the following directly associated activities:
Section 6.9 Part A (1) (a) Rearing pigs or poultry intensively in an installation with more than – (i) 40,000 places for poultry Biomass Boiler – Operation of one biomass boiler with a thermal rated input of 1120kW for site heating Dirty water tank – Storage of dirty water from washing of poultry houses Together, these listed and directly associated activities comprise the Installation.
**European Directives** All applicable European directives have been considered in the determination of the application.
**The site** The local topography is hilly to mountainous, with the land generally rising to the west and northwest, towards the Snowdonia National Park area 11.25km away in that direction. The land is described as “Improved Grassland”. The dominating local land use is agricultural, livestock farming, with sheep as the primary livestock. There are occasional lone trees dotted around the landscape with a few lines of trees following former hedgerow lines. Most former hedgerows in the immediate area have been uprooted and replaced by wire fencing.
The operator has provided a plan which we consider is satisfactory, showing the extent of the site of the facility. A plan is included in the permit and the operator is required to carry on the permitted activities within the site boundary.
**Site condition report** The operator has provided a description of the condition of the site. The report covers general site description, surface waters, Natural England/DeFRA Classifications, hydrology and geology classifications, and soilscape.
We consider this description is satisfactory. The decision was taken in accordance with our guidance on site condition reports – guidance and templates (H5).
**Biodiversity, Heritage, Landscape and Nature Conservation** The application is within the relevant distance criteria of a site of heritage, landscape or nature conservation, and/or protected species or habitat.
A full assessment of the application and its potential to affect the wildlife sites has been carried out as part of the permitting process. We consider that the application will not affect the wildlife sites.
The following sites have been considered: 14 areas of Ancient Woodland (AW)s/Local Wildlife Sites (LWS)s within 2km of the site
Sites of Special Scientific Interest (SSSI)s (within 5km of the site)
- Cors Llyn Coethlyn SSSI
- Cors Lawnt SSSI
- Coed y Lawnt a Coed Oli SSSI
- Coed Copi’r Graig SSSI
- Fachwen Isaf SSSI
- Gweunydd Dyfnant SSSI
- Gweunydd Pen-y-Coed SSSI
- Bryn Coch SSSI
Special Areas of Conservation (SAC)s, Special Protection Areas (SPA)s and Ramsars (within 10km of the site)
- Berwyn and South Clwyd Mountains SAC
- Berwyn SPA
OGN Form 1 and CRoW Appendix 4 were completed and forwarded to our internal Natural Resources Management (NRM) team for consultation. Concerns were raised internally about the proximity of the site to wetland SSSI Cors Llyn Coethlyn. Following this, the operator carried out more detailed ammonia modelling for the proposal and submitted an updated ammonia modelling report which NRW was satisfied demonstrated that the proposal would not likely have a significant effect on any wildlife sites (see section on Air).
Environmental Risk Assessment
Air
This section of the decision document deals primarily with the dispersion modelling of emissions to air from the facility and its impact on local air quality.
The Applicant has assessed the Installation’s potential emissions to air against the relevant air quality standards. These assessments predict the potential effects on local air quality from the Installation. We are in agreement with this approach. The assumptions underpinning the model have been checked and are reasonably precautionary. The way in which the Applicant used dispersion models, its selection of input data, use of background data and the assumptions it made have been reviewed by Natural Resources Wales to establish the robustness of the Applicant’s air impact assessment.
As part of their application, the operator submitted a report on the modelling of the dispersion and deposition of ammonia from the proposed broiler chicken rearing houses at Cefnau Bach. The modelling predicted that the process contribution of the proposed poultry unit to annual ammonia concentration and nitrogen deposition rate would be below NRW’s lower threshold percentage of Critical Level or Load (4% for the SACs, SPAs, 20% for the SSSIs and 100% for the AWs/LWSs) for all sites considered.
However, concerns had been raised internally within NRW about the proximity of the site to wetland SSSI Cors Llyn Coethlyn, and the fact that for this wildlife site, the 16.3% ammonia concentration from the proposed site could cause damage to the features of the SSSI as it would be adding to the background ammonia concentration for the wildlife site which is already at 110%. On 26th June 2017, NRW wrote to the applicant stating that we were minded to refuse the application based on the above concern. The application would be refused unless the operator could demonstrate that the ammonia impact at Cors Llyn Coethlyn could be substantially reduced to a level close to the background. In their response, the operator requested a 6 week extension to the determination period of the application, from 30th June 2017, to look into the ammonia issues identified. On 3rd August 2017, the applicant submitted to NRW a revised ammonia modelling report, which included results of more detailed modelling.
The detailed modelling carried out by the operator demonstrated that the previous 16.3% ammonia concentration to Cors Llyn Coethlyn SSSI could be substantially reduced to 2%. We are satisfied that the risk of ammonia emissions from the proposal to relevant wildlife sites is not significant.
As a result of the additional time requested and taken by the operator to provide information, the statutory deadline for determining the application was extended by 34 days from 22nd July 2017 to 25th August 2017. In Appendix 7 of the application (Technical Standards), the operator confirms that hot water will be provided to the facility by one 995 Kilowatt (1120 Kilowatt input) clean biomass boiler. The information provided in the application satisfies the conditions of NRW’s position statement on biomass boilers on EPR intensive farms, which states that a quantitative assessment of air emissions from biomass boilers will not be required where:
- The fuel is derived from virgin timber
- The biomass boiler appliance and its installation meets the technical criteria to be eligible for the Renewable Heat Incentive
- The aggregate boiler net thermal input is less than 2MWth where: 1) the stack height is greater than 1 metre above the roof level of any buildings within 25 metres (or where there are no buildings within 25 metres, the stack height must be a minimum of 3 metres above the ground, 2) there are no Special Areas of Conservation, Special Protection Areas, Ramsar sites or Sites of Special Scientific Interest within 500 metres of the emission point(s), 3) there are no National Nature Reserves, Local Nature Reserves, Ancient Woodlands or Local Wildlife Sites within 100 metres of the emission point(s), and 4) there are no sensitive receptors within 150 metres of the emission point(s).
**Emission limits**
We have decided that emission limits should be set for the parameters listed in the permit.
**Water**
Based upon the information in the application we are satisfied that the appropriate measures will be in place to prevent pollution of ground and surface water.
In Appendix 7 of the application (Technical Standards), the operator states that the only discharge to water will be yard drainage discharge of uncontaminated surface water to an off-site open drainage ditch leading to River Banwy.
**Emission limits** We have decided that it is not relevant to set emission limits for the parameters listed in the permit.
**Soil**
The operator has provided a description of how the site has been designed to prevent/minimise harmful release of polluting substances. Raw materials such as biocides, pesticides, veterinary medicines, bedding types, fuels and oils will be contained. The fuel oil storage tank for generator will be bunded and will be integral to the generator. The bunds meet the requirements of the Control of Pollution (Silage, Slurry and Agricultural Fuel Oil) Regulations 1991 (amended 1997) and meet the requirements outlined in SGN EPR6.09. The tanks will be regularly inspected. The Liquid Petroleum Gas tanks will be protected from collision damage by guard rails. Pesticides and veterinary medicines will be kept in a store capable of retaining spillage, resistant to fire, dry, frost free and secure. Feed will be kept in silos adjacent to the broiler sheds. No liquid feed will be stored at the site. The silos will be sited away from site traffic and protected from collision damage.
We consider this description is satisfactory. The decision was taken in accordance with our guidance on site condition reports – guidance and templates (H5).
**Odour**
This section of the decision document deals primarily with the dispersion modelling of odour from the facility and its impact on nearby receptors.
The Applicant has assessed the Installation’s potential odour emissions against the relevant odour standards, and the potential impact upon nearby receptors. We are in agreement with this approach. The assumptions underpinning the model have been checked and are reasonably precautionary. The way in which the Applicant used dispersion models, its selection of input data, use of background data and the assumptions it made have been reviewed by NRW to establish the robustness of the Applicant’s odour impact assessment. As part of their application, the operator submitted a report on a dispersion modelling study of the impact of odour from the proposed broiler chicken rearing houses at Cefnau Bach. H4 Odour Management guidance explains that the odour benchmarks are based on the 98th percentile of hourly average concentrations of odour modelled over a year at the site/installation boundary. The benchmarks are:
- 1.5 odour units for most offensive odours
- 3 odour units for moderately offensive odours
- 6 odour units for less offensive odours
Odours from poultry rearing are usually placed in the moderately offensive category.
The modelling predicted that at all nearby residences, the predicted 98th percentile odour concentrations would be below NRW’s benchmark for moderately offensive odours, a maximum annual 98th percentile hourly mean concentration of 3.0 ouE/m. We are satisfied that the risk of odour pollution at nearby sensitive receptors is not significant. NRW has assessed the modelling in detail and is satisfied that it accurately represents the predicted odours. It is recognised that this modelling only represents the expected odour concentrations for 98% of the time and that odours may be higher for the remaining 2% of the time. NRW is not able to ensure that odour impacts on nearby receptors are reduced to zero, but is determined to ensure that they are minimised.
The operator has submitted an odour management plan (OMP) for the installation as required by EPR 6.09 “How to Comply with your Permit for Intensive Farming” because there are sensitive receptors within 400m of the installation. The OMP described the measures and controls in place to minimise odour and includes twice daily olfactory checks. We have compared the measures proposed for the site to the Best Available Techniques (BAT) standards in EPR 6.09 and are satisfied that the techniques represent appropriate measures for the installation. The OMP has been incorporated into the operating techniques section of the permit.
Permit condition 3.3.1 requires that emissions from the activities are free from odour at levels likely to cause pollution outside the site, as perceived by an officer of NRW. We are satisfied that this condition will be sufficiently protective in conjunction with the measures described by the applicant for minimising odour production at the installation.
**Noise**
The applicant has submitted a noise management plan (NMP) for the installation as required by EPR 6.09 “How to Comply with your Permit for Intensive Farming” because there are sensitive receptors within 400m of the installation. Potential sources of noise include vehicles travelling to and from the site and ventilation fans. The NMP describes the measures and controls in place to minimise noise. We have compared the measures proposed for the site to the BAT standards in EPR 6.09 and are satisfied that the techniques represent appropriate measures for the installation. The NMP has been incorporated into the operating techniques section of the permit.
Permit condition 3.4.1 requires that emissions from the activities are free from noise at levels likely to cause pollution outside the site, as perceived by an officer of NRW. We are satisfied that this condition will be sufficiently protective in conjunction with the measures described by the applicant for minimising noise production at the installation.
**Fugitive emissions**
Appropriate measures for preventing and minimising fugitive emissions will be in place in accordance with the SGN EPR 6.09, including:
- Buildings will be maintained in good repair
- Areas around buildings will be kept free from build-up of manure, slurry and spilt feed
- Footbaths will be managed so that they do not overflow
- Drainage from animal housing and water from cleaning out will be collected in an underground storage tank
- Diverter bungs will be used during wash down periods to prevent the contamination of surface water systems and to divert the wash water to the dirty water tanks.
- Clean drainage systems will not be contaminated.
- Drainage from yards contaminated by litter or wash water will be collected in a dirty water tank.
With regards to dust:
- Feed will be stored in purpose built covered feed silos located next to the broiler sheds.
- No milling of feed will take place at the farm. All mixing of whole wheat with propriety feeds will be in a sealed steel shed. All feed will be delivered to the farm by lorry from feed suppliers. Feed will be blown directly from the lorry into the storage silos. Feed will be piped from the silos to the sheds minimising dust emissions.
- Ventilation systems will be operated to achieve optimum humidity levels for the stage of production in all weather and seasonal conditions.
- Control of minimum ventilation rates will be planned to avoid the build-up of moisture in the house.
- Ventilation will be appropriate to the age and weight of the animal.
- The sheds will be managed to maintain the poultry litter is as dry and friable condition as possible. Dust will be controlled through the management of litter and air quality.
- All minimum ventilation in all the Broiler houses will be by high velocity roof outlets with some gable end fanning in hot summer weather.
- Rainwater from the houses is captured and directed using ‘french’ drains before being directed off site.
- Litter will not be stored on the site.
- The biomass used in this system will be clean biomass and will not contain any used or recycled material. The biomass will be delivered in to a sealed store thus minimising any dust. From the store the biomass is augured in to the boiler using a sealed system to prevent dust escaping in to the atmosphere. The boiler room itself is also sealed again to prevent dust from escaping in to the atmosphere.
Based upon the information in the application we are satisfied that the appropriate measures will be in place to prevent or where that is not practicable to minimise fugitive emissions, including dust, and to prevent pollution from fugitive emissions.
**Monitoring** No monitoring is required from the point source emissions on site. We made this decision in accordance with EPR 6.09 “How to Comply with your Permit for Intensive Farming”.
**Reporting** We have specified reporting requirements in Appendix 2, Schedule 4 of the Permit to ensure compliance with permit conditions and to monitor the efficiency of farming activities at the site in line with BAT. We made this decision in accordance with EPR 6.09 “How to Comply with your Permit for Intensive Farming”.
**Operating techniques** We have reviewed the techniques used by the operator and compared these with the relevant guidance notes. We are satisfied that the techniques represent appropriate measures for the installation in line with BAT standards in EPR 6.09. The permit conditions
Use of conditions other than those from the template Based on the information in the application, we do not consider that we need to impose conditions other than those in our permit template.
Raw materials We have specified limits and controls on the use of raw materials and fuels.
Waste types No waste types can be accepted at the regulated facility.
Pre-operational conditions Based on the information in the application, we do not consider that we need to impose pre-operational conditions.
Improvement conditions Based on the information on the application, we do not consider that we need to impose improvement conditions. Conditions where the consent of another person is needed.
Based on the information submitted in the application, we do not consider that it is necessary to impose conditions where the consent of another person is needed.
Incorporating the application
We have specified that the applicant must operate the permit in accordance with descriptions in the application, including all additional information received as part of the determination process.
These descriptions are specified in the Operating Techniques table in the permit.
Operator Competence
Environment management system Appendix 3 of the application (Summary of Environment Management System) gives a summary of the EMS that will be in place before operations commence. It will cover normal operations, maintenance schedule and records, incidents and abnormal operations, complaints system, accidents, training, and site security.
There is no known reason to consider that the operator will not have the management systems to enable it to comply with the permit conditions. The decision was taken in accordance with RGN 5 on Operator Competence.
Technical competence Technical competency is not required for activities permitted.
Relevant convictions Our Enforcement Database has been checked to ensure that all relevant convictions have been declared. No relevant convictions were found.
The operator satisfies the criteria in RGN 5 on Operator Competence.
Financial provision There is no known reason to consider that the operator will not be financially able to comply with the permit conditions. The decision was taken in accordance with RGN 5 on Operator Competence. ANNEX 1: Consultation Responses
A) Advertising and Consultation on the Application
The Application has been advertised and consulted upon in accordance with Natural Resources Wales Public Participation Statement (PPS). The way in which this has been carried out along with the results of our consultation and how we have taken consultation responses into account in reaching our draft decision is summarised in this Annex. Copies of all consultation responses have been placed on Natural Resources Wales public register.
1. Consultation Responses from Statutory and Non-Statutory Bodies No responses were received from statutory and non-statutory bodies.
2. Consultation Responses from Members of the Public and Community Organisations A number of the issues raised during the consultation process are outside Natural Resources Wales remit in reaching its permitting decisions. Specifically questions were raised which fall within the jurisdiction of the planning system, both on the development of planning policy and the grant of planning permission. Specific planning issues raised related to the location of the site, the location of the stack, traffic movements and emissions from off-site traffic movements.
Guidance on the interaction between planning and pollution control is given in PPS23 / Planning Policy Wales. It says that the planning and pollution control systems are separate but complementary. We are only able to take into account those issues, which fall within regulatory scope of the Environmental Permitting Regulations (EPR).
a) Representations from Local MP, Assembly Member (AM), Councillors and Parish / Town / Community Councils No responses were received from representations from local MP, AM, Councillors and Parish/Town/Community Councils
b) Representations from Community and Other Organisations No responses were received from Community and Other Organisations.
c) Representations from Individual Members of the Public No responses were received from Individual Members of the Public.
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311e69b8e548317fcc1d234e4f9c5f6461d4181c | National Asthma and Chronic Obstructive Pulmonary Disease Audit Programme (NACAP)
Adult asthma and COPD organisational audit 2019 Resources and organisation of care in hospitals in England, Scotland and Wales 2019
Key findings and recommendations Published March 2020 Royal College of Physicians The Royal College of Physicians (RCP) plays a leading role in the delivery of high-quality patient care by setting standards of medical practice and promoting clinical excellence. The RCP provides physicians in over 30 medical specialties with education, training and support throughout their careers. As an independent charity representing over 37,000 fellows and members worldwide, the RCP advises and works with government, patients, allied healthcare professionals and the public to improve health and healthcare.
Healthcare Quality Improvement Partnership (HQIP) The National Asthma and COPD Audit Programme (NACAP) is commissioned by the Healthcare Quality Improvement Partnership (HQIP) as part of the National Clinical Audit and Patient Outcomes Programme (NCAPOP). HQIP is led by a consortium of the Academy of Medical Royal Colleges, the Royal College of Nursing and National Voices. Its aim is to promote quality improvement in patient outcomes, and in particular, to increase the impact that clinical audit, outcome review programmes and registries have on healthcare quality in England and Wales. HQIP holds the contract to commission, manage and develop NCAPOP, comprising around 40 projects covering care provided to people with a wide range of medical, surgical and mental health conditions. The programme is funded by NHS England, the Welsh Government and, with some individual projects, other devolved administrations and crown dependencies www.hqip.org.uk/national-programmes.
National Asthma and COPD Audit Programme (NACAP) The NACAP is a programme of work that aims to improve the quality of care, services and clinical outcomes for patients with asthma and COPD in England, Scotland and Wales. Spanning the entire patient care pathway, NACAP includes strong collaboration with asthma and COPD patients, as well as healthcare professionals, and aspires to set out a vision for a service which puts patient needs first. To find out more about the NACAP visit: www.rcplondon.ac.uk/nacap.
Adult asthma and COPD organisational audit 2019 report This report was prepared by the following people, on behalf of the asthma advisory group and COPD advisory group (the full list of members are included in the online appendices here: www.rcplondon.ac.uk/nacap-resources).
Professor C Michael Roberts, senior clinical lead, NACAP, Care Quality Improvement Department (CQID), RCP, London; managing director, UCLPartners Academic Health Science Network, London. Mr Philip Stone, research assistant in statistics/epidemiology, National Heart and Lung Institute, Imperial College London Ms Sophie Robinson, project manager, NACAP, CQID, RCP, London Dr Jennifer Quint, clinical senior lecturer in respiratory epidemiology, National Heart and Lung Institute, Imperial College London; honorary respiratory consultant, Royal Brompton and Imperial College Healthcare NHS trusts Mr Matthew Legg, programme manager, NACAP, CQID, RCP, London Ms Viktoria McMillan, programme manager, NACAP, CQID, RCP, London Mr Alex Adamson, research assistant in medical statistics, National Heart and Lung Institute, Imperial College London Dr James Calvert, adult asthma clinical lead, NACAP, CQID, RCP, London; consultant respiratory physician, North Bristol NHS Trust; and national specialty advisor for severe asthma Professor John Hurst, COPD clinical lead, NACAP, CQID, RCP, London; and professor and honorary consultant in respiratory medicine, University College London/Royal Free London NHS Foundation Trust
Citation for this document: Roberts CM, Stone P, Robinson S, Quint J, Legg M, McMillan V, Bowra Z, Adamson A, Calvert J, Hurst J. National Asthma and Chronic Obstructive Pulmonary Disease Audit Programme (NACAP): Adult asthma and COPD organisational audit 2019. Resources and organisation of care in hospitals in England, Scotland and Wales 2019. Key findings and recommendations. London: RCP, 2020.
Copyright © Healthcare Quality Improvement Partnership 2020 ISBN: 978-1-86016-783-6 eISBN: 978-1-86016-784-3
Royal College of Physicians Care Quality Improvement Department 11 St Andrews Place Regent’s Park London NW1 4LE
Registered charity no 210508 www.rcplondon.ac.uk/nacap @NACAPaudit #NACAPAuditQI #AdultAsthmaAudit #COPDaudit Contents
Report at a glance .................................................................................................................. 4 How to use this report ........................................................................................................... 5 Foreword by Professor Mike Roberts, programme clinical lead, NACAP .............................. 6 Recommendations .................................................................................................................. 7 For providers across the sectors ......................................................................................... 7 For commissioners, sustainability transformation partnerships (STPs) and health boards in England and Wales ........................................................................................................ 7 For health boards in Scotland ............................................................................................ 7 For specialist societies ....................................................................................................... 7 For patients/carers ............................................................................................................. 7 Key findings ............................................................................................................................ 8 Section 1: Admissions ....................................................................................................... 8 Section 2: Staffing levels .................................................................................................. 10 Section 3: Access to specialist staff and services ............................................................ 11 Section 4: 7-day working ................................................................................................. 15 Section 5: Management of care ....................................................................................... 18 Section 6: Integrating care ............................................................................................... 21 Section 7: Patient and carer engagement ......................................................................... 24 Section 8: Transitional care ............................................................................................. 25 Section 9: Reimbursement for costs of care .................................................................... 27 Appendix A: Document purpose ......................................................................................... 28 Appendix B: References ....................................................................................................... 29 Report at a glance
Safe (CQC domain): Workload (medians)\*, †
- Adult medical emergency admissions per medical bed: 69 (IQR 54–88)
- Adult respiratory admissions per respiratory bed: 101 (IQR 78–136)
- Respiratory consultants per 1,000 adult COPD emergency admissions: 7 (IQR 5–11)
- Respiratory consultants per 1,000 adult asthma emergency admissions: 23 (IQR 16–31)
Well-led (CQC domain): Clinical leadership¶
- 16% of hospitals are without a designated clinical lead for COPD
- 19% of hospitals are without a designated clinical lead for asthma
- 67% of hospitals are without dedicated time devoted to developing integrated respiratory services
Effective (CQC domain): Respiratory review\*\*
Provision of ward rounds by senior decision makers (ST3 or above) from the respiratory team for new asthma and COPD patients:
- Respiratory wards: 7% of hospitals do not provide this
- Acute medical units: 45% of hospitals do not provide this
- Other wards: 59% of hospitals do not provide this
Responsive (CQC domain): Integrated care††
- 14% of hospitals do not have a severe asthma service or a referral pathway to one
- 42% of hospitals do not hold a regular COPD MDT meeting between hospital and community teams
- 44% of hospitals with pulmonary rehabilitation services do not make this available within 4 weeks of discharge for COPD patients
- 70% of hospitals do not have any formal transition arrangements for young people with asthma
* Figures based on the 2018/19 financial year. † There are no national standards for safe staffing of respiratory services. However, the observed variation between providers strongly suggests that standards are needed to ensure the NHS delivers safe care to all patients, regardless of the organisation they present to. § IQR = interquartile range. ¶ WTE = whole time equivalent. † National recommendations are that each service should have a dedicated clinical lead to ensure a high-quality service in accordance to standards is provided for patients. \*\* Audit data demonstrates that patients reviewed by a member of the respiratory team are more likely to receive high-quality guideline-recommended care. †† The NHS Long Term Plan recommends that the NHS develops integrated care systems to optimise patient care. How to use this report
1. Scope and report structure
This report contains the main messages and key recommendations derived from an analysis of data collected for the adult asthma and chronic obstructive pulmonary disease (COPD) organisational audit component of the National Asthma and COPD Audit Programme (NACAP). Data collection for the organisational audit took place between 1 April and 1 July 2019 across England, Scotland and Wales. The audit collected information on the resourcing and organisation of services relevant to the care of adult patients with asthma and COPD that are admitted to hospital.
A separate data analysis and methodology report is available at: www.rcplondon.ac.uk/copd-asthma-organisational-2018-19 and provides the following information:
- the full data analyses, presented with England, Scotland and Wales results separately, as well as combined results for all three countries denoted as ‘All’ (England, Scotland and Wales) in tables and figures, with explanatory notes throughout
- nationally benchmarked results for participating hospitals for a selection of dataset variables
- appendices, including the methodology for the audit.
References to the appropriate National Institute for Health and Care Excellence (NICE) clinical guidelines and quality statements, and British Thoracic Society (BTS) guidelines relevant to asthma and COPD care, are inserted throughout the key findings.
2. Report coverage
167/175 (95%) eligible hospitals in England, 6/25 (24%) eligible hospitals in Scotland and 16/17 (94%) eligible hospitals in Wales participated in this organisational audit. The low participation rate from Scotland has resulted in instances of highly skewed data for some metrics, therefore, for these metrics, data for Scotland are not reported separately in the data analysis and methodology report.
3. Intended audience
This report is intended to be read by healthcare professionals, NHS managers, chief executives and board members, service commissioners and policy makers, as well as voluntary organisations. A separate report has been produced for patients and the public and is available at: www.rcplondon.ac.uk/copd-asthma-organisational-2018-19.
We strongly advise that secondary care teams discuss these findings with commissioners as a basis for informing future integrated care partnership service development. Foreword by Professor Mike Roberts, programme clinical lead, NACAP
This report highlights the variation and inequalities in the provision of resource and organisation of care to meet national quality standards for asthma and COPD services. Equity of access to high-quality care should be the reasonable expectation of all patients and the public. While some provider organisations meet many quality standards, others fail to do so across a range of provision that should be a serious cause of concern to commissioners.
For hospitals to provide high-quality services there must be effective leadership, both at board level, and from front-line clinicians. There must be sufficient numbers of clinical and support staff with appropriate training and effective team working. Cohesive services require systems to be integrated internally and with community and primary care teams, and the views and experiences of patients should be at the heart of all that we do. This audit demonstrates that around one in six organisations lack this clinical leadership, that there is a three-fold variation in staffing levels adjusted for workload, that over a half of hospitals do not operate joint community team working, while over two thirds have no formal transitional arrangements for young people with asthma to move to adult services. Almost a half of hospitals do not formally consult patients on services at all, and less than a third engage with patients frequently to help plan services.
The purpose of this report, however, is not to criticise organisations where the organisation of care falls below that expected, but to highlight where this occurs with a view to engaging providers, commissioners, patients, clinicians and managers in a programme of improvement. Within this report we itemise the national quality standards that all partners in this improvement programme should be sighted on. The report highlights good practice that can be replicated elsewhere, so reducing the unwarranted variation currently observed. We provide example case studies of good practice on our website\* and signpost improvement teams to other relevant sources of education, training and improvement support.†‡ In addition, the NACAP reports on the quality of care of all engaged provider organisations through real-time run charts, providing data in a format to support improvement at hospital level.
We call upon commissioners, trusts and health boards to work together with patients to ensure that national quality standards are met in all provider organisations across the NHS and to acknowledge that the variation reported here is not acceptable within a NHS committed to equitable access and provision of high-quality care to all citizens.
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- To view the NACAP workstream good practice repositories, please visit: www.rcplondon.ac.uk/nacap † Please visit the Respiratory Futures website for more information: www.respiratoryfutures.org.uk/ ‡ For more information about NACAP-specific quality improvement activities, please visit: www.rcplondon.ac.uk/projects/national-asthma-and-copd-audit-programme-nacap-quality-improvement Recommendations
For providers across the sectors
We have defined two key national recommendations for 2020/21 based on the organisational audit data as follows:
1. To resource and organise respiratory services to the national quality standards and guidelines highlighted in this report.
2. To work with commissioners and with patients to achieve these standards.
For commissioners, sustainability transformation partnerships (STPs) and health boards in England and Wales
1. To commission asthma and COPD services to the national NICE and BTS/SIGN standards, working with providers and patients to achieve these standards.
2. To identify variation in the standard of services offered by hospitals within the same locality, and to work to achieve high-quality services across all providers.
For health boards in Scotland
1. Health boards should actively support hospitals to participate in national audit, providing resources for data collection, analysis and improvement, in order to better understand where changes can be made for patient benefit and then to implement those changes.
For specialist societies
1. Consider providing a framework for the range and type of secondary care specialist services that should be provided to all patients with COPD and asthma.
2. Consider providing recommendations for the minimum safe number of respiratory specialist staff that should be available to support safe respiratory services.
For patients/carers
1. Members of patient representative organisations should advocate for the universal implementation of national quality standards across all hospitals.
2. Individuals should engage with local commissioners and hospitals through participation in patient experience groups to co-design service improvement. Key findings
Section 1: Admissions
To see the data analysis in full, please access the data analysis and methodology report available at: www.rcplondon.ac.uk/copd-asthma-organisational-2018-19
Audit results – admissions:
- Between 1 April 2018 and 31 March 2019 (the 2018/19 financial year) the median number of admissions were as follows:
- 69 (interquartile range (IQR): 54–88) general medical adult emergency admissions per medical bed
- 101 (IQR: 78–136) respiratory-coded admissions per respiratory bed
- 11 (IQR: 9–14) adult asthma-coded emergency admissions per 1,000 adult medical emergency admissions
- 34 (IQR: 28–43) COPD-coded emergency admissions per 1,000 adult medical emergency admissions.
- It is acknowledged that the figures for asthma and COPD-coded emergency admissions appear to be lower than expected. Possible reasons for this include:
- The data is based only on patients with the following ICD-10 codes in the primary position:
- J44.0, J44.1, J44.8 and J44.9 for COPD
- J45.0, J45.1, J45.8, J45.9, J46.0 for asthma.
- There may be errors in the original data where coding inconsistencies have not been investigated/corrected.
- 90% of hospitals have a dedicated respiratory ward. But not all respiratory admissions are managed there:
- The national average proportion of all emergency COPD-coded admissions discharged, or died, on dedicated respiratory wards in the 2018/19 financial year was 39% (median) (IQR 25–74%).
- The national average proportion of all emergency asthma-coded admissions discharged, or died, on dedicated respiratory wards in the 2018/19 financial year was 41% (median) (IQR 24–75%).
Audit results – beds:
- The median number of bed types were as follows:
- 275 (IQR: 203–400) medical beds (average per hospital)
- 30 (IQR: 26–47) beds on dedicated respiratory wards (average per hospital)
______________________________________________________________________
8 In the 2017 COPD organisational audit for England and Wales, the median number of medical beds was 258 (the full report is available at: www.rcplondon.ac.uk/projects/outputs/copd-time-integrate-care-organisational-audit-2017)
\*\* In the 2017 COPD organisational audit for England and Wales, the median number of beds on dedicated respiratory wards was 28 (the full report is available at: www.rcplondon.ac.uk/projects/outputs/copd-time-integrate-care-organisational-audit-2017)
- 0 (IQR: 0–1) level 2 beds on dedicated respiratory wards, per 1,000 adult respiratory admissions
- 3 (IQR: 2–6) high-dependency unit (HDU) beds per 10,000 adult medical emergency admissions
- 5 (IQR: 3–7) intensive care unit (ICU) beds per 10,000 adult medical emergency admissions.
- 85% of hospitals have a HDU and 94% have an ICU to which asthma and COPD patients can be admitted. Section 2: Staffing levels
To see the data analysis in full, please access the data analysis and methodology report available at: www.rcplondon.ac.uk/copd-asthma-organisational-2018-19
Key standards: There are no national recommendations for the number of staff to be made available to manage care for respiratory patients. What is clear from these data is that there is wide variation in the number of specialist staff per 1,000 respiratory admissions across hospitals, and that such variation must result in variable care quality. Vacancies against an establishment further undermine effective care.
- **NICE 2011 QS10 [Care in hospital]**: People admitted to hospital with an exacerbation of COPD are cared for by a respiratory team and have access to a specialist early supported-discharge scheme with appropriate community support.¹
- **NICE 2013 QS25 [QS9]**: People admitted to hospital with an acute exacerbation of asthma have a structured review by a member of a specialist respiratory team before discharge.²
Audit results – respiratory consultant staffing levels:
- 7 (4%) hospitals have no respiratory consultant(s) in post. In addition, 26% of hospitals have between 0.1–1 WTE vacancies, 14% have between 1.1–3.0 WTE vacancies and 2% have more than 3.0 WTE vacancies for respiratory consultant staff.
Audit results – respiratory nurse staffing levels:
- 19% of hospitals do not have a general respiratory nurse specialist(s) in post. In addition, 11% of hospitals have between 0.1–1 WTE vacancies, 5% have between 1.1–3.0 WTE vacancies and 3% have more than 3.0 WTE vacancies for a general respiratory nurse specialist.
- 58% of hospitals do not have a COPD nurse specialist(s) in post. In addition, 7% of hospitals have between 0.1–1 WTE vacancies for this position while 93% of hospitals have no vacancies.
- 67% of hospitals do not have an asthma nurse specialist post. In addition, 4% of hospitals have between 0.1–1 WTE vacancies for this position while 96% have no vacancies.
Audit results – respiratory physiologist
- 17% of hospitals do not have a respiratory physiologist(s) in post. In addition, 15% of hospitals have between 0.1–1 WTE vacancies for this position, while 81% of hospitals have no vacancies. Section 3: Access to specialist staff and services
To see the data analysis in full, please access the data analysis and methodology report available at: www.rcplondon.ac.uk/copd-asthma-organisational-2018-19
Key standards – access to respiratory medical team:
- **National COPD Audit Programme 2014 \[National Organisational Audit Report\]:** Each unit should nominate a respiratory clinical lead for discharge care and integrating services, this individual having designated time to improve the uptake of discharge bundles, improve the quality of discharge information and work collaboratively with colleagues in primary care to improve integrated pathways for COPD.¹
- **NICE 2011 QS10 \[QS10\]:** People admitted to hospital with an exacerbation of COPD are cared for by a respiratory team and have access to a specialist early supported-discharge scheme with appropriate community support.¹
- **NICE 2013 QS25 \[QS9\]:** People admitted to hospital with an acute exacerbation of asthma have a structured review by a member of a specialist respiratory team before discharge.²
- **NRAD 2014 \[Organisation of NHS Services, Recommendation 1\]:** Every NHS hospital and general practice should have a designated, named clinical lead for asthma services, responsible for formal training in the management of acute asthma.⁴
Audit results – access to respiratory medical team:
- 81% of hospitals have a designated named clinical lead for asthma and 84% of hospitals have a designated named clinical lead for COPD.
- 81% of asthma and COPD patients on admissions wards are reviewed by a senior decision maker (ST3 or above) daily on weekdays. In addition, 58% of asthma and COPD patients are reviewed daily on weekends by a senior decision maker.
- For 78% of hospitals, respiratory consultants and ST3s contribute to the acute medical take.
- On-call availability of respiratory consultants, or ST3s and above, for acute medicine is mixed with:
- availability every day in 9% of hospitals
- availability 1 day in 2/3 in 23% of hospitals
- availability 1 day in 4/5 in 32% of hospitals
- availability less frequently than 1 day in 5 in 36% of hospitals.
- 19% of hospitals operate a dedicated on-call rota for respiratory emergency admissions. Case study – Heartlands Hospital (University Hospitals Birmingham NHS Foundation Trust):
Heartlands Hospital is one of four hospital sites at University Hospitals Birmingham NHS Foundation Trust. The team have managed to achieve high levels of specialist review of admitted respiratory patients through four main methods:
1. The respiratory team have established a specialist respiratory on-call rota, which now has an electronic method of adding patients for specialist review. Through consultant presence at the morning handover within general medicine, and registrar presence at 5pm and 9pm handovers, the respiratory team are able to reiterate regularly the need for acute teams to tell them about respiratory patients. After review by the medical team a daily email is sent to the respiratory department, including the COPD nurses.
2. Two respiratory consultants (jointly with acute medicine) have been appointed, thus ensuring regular specialist input within the acute and short stay wards. This relieves pressure on the specialist take and ensures short stay patients can be seen more easily.
3. The respiratory nurses check in with outlying wards, in particular those with high turnover of patients, on a daily basis. This ensures that any patients not alerted to the medical team via the electronic list are known to the respiratory team and can be seen.
4. The clerk entering NACAP data knows the names of all the respiratory SpRs and fellows; this means that patients seen by a member of the specialist team in out of hours in particular, who also might be discharged quickly (or not subsequently on the respiratory ward), have their specialist review recognised and entered onto the NACAP system.
The respiratory department has registrars, consultants and respiratory nurses within the reviewing team. The medical staff do rounds twice daily, 7 days/week, using the electronic list, and nurses contact wards and review the email list daily Monday–Friday.
The respiratory department has also changed processes in two ways. Firstly, the department has had more respiratory engagement with acute medicine over the last 18 months. Secondly the nurses monitor the data received from coding each month to determine if there are particular areas where patients are being missed, and use this to determine which areas they should target with daily calls/visits. Key standards – access to other staff and services:
- **BTS/SIGN 2019 [6.2.9]**: Weight-loss interventions (including dietary and exercise-based programmes) should be considered for overweight and obese adults and children with asthma to improve asthma control.(^5)
- **NICE 2019 NG115 [1.2.103]**: Refer people [with COPD] for dietetic advice if they have a BMI that is abnormal (high or low) or changing over time.(^5)
- **NICE 2019 NG115 [1.2.109]**: People with end-stage COPD and their family members or carers (as appropriate) should have access to the full range of services offered by multidisciplinary palliative care teams, including admission to hospices.(^6)
- **NICE 2011 QS10 [QS13]**: People with advanced COPD, and their carers, are identified and offered palliative care that addresses physical, social and emotional needs.(^1)
Audit results – access to other staff and services:
- 99% of hospitals provide **inpatient dietetic services** which are available to asthma patients and COPD patients.
- 99% of hospitals provide **on-site palliative care services** which are available to COPD patients.
Key standards – smoking cessation services:
- **BTS/SIGN 2019 [6.2.3]**: People with asthma and parents/carers of children with asthma should be advised about the dangers of smoking and second-hand tobacco smoke exposure, and should be offered appropriate support to stop smoking.(^5)
- **NICE 2019 NG115 [1.2.3]**: At every opportunity, advise and encourage every person with COPD who is still smoking (regardless of their age) to stop, and offer them help to do so.(^6)
- **NICE 2019 NG115 [1.2.4]**: Unless contraindicated, offer nicotine replacement therapy (NRT), varenicline or bupropion as appropriate to people who want to stop smoking, combined with an appropriate support programme to optimise smoking quit rates for people with COPD.(^6)
- **NICE 2018 NG92 [1.1.1]**: Use sustainability and transformation plans, health and wellbeing strategies, and any other relevant local strategies and plans to ensure evidence-based stop smoking interventions and services are available for everyone who smokes.(^7)
- **NICE 2018 NG92 [1.1.3]**: Prioritise specific groups who are at high risk of tobacco-related harm.(^7)
- **NICE 2018 NG92 [1.3.1]**: Ensure the following evidence-based interventions are available for adults who smoke:(^7)
- behavioural support (individual and group)
- bupropion
- NRT – short and long acting
- varenicline
- very brief advice.
- **NICE 2018 NG92 [1.3.3]**: Offer varenicline as an option for adults who want to stop smoking, normally only as part of a programme of behavioural support, in line with NICE’s technology appraisal guidance on varenicline.(^7)
- **NICE 2018 NG92 [1.3.4]**: For adults, prescribe or provide varenicline, bupropion or NRT before they stop smoking.(^7)
- **NICE 2018 NG92 [1.3.8]**: Ensure behavioural support is provided by trained stop smoking staff.(^7) Audit results – smoking cessation services:
- 63% of hospitals have a smoking cessation service available for asthma and COPD patients to access.††
- NRT is routinely available in 99% of hospitals, but varenicline (52%) and bupropion (37%) are less widely available to inpatients.
Case study – Eastbourne District General Hospital (East Sussex Healthcare NHS Trust)
Eastbourne District General Hospital was identified as providing a comprehensive smoking cessation service.
- When the respiratory nurses review patients for the discharge bundle they provide very brief advice (VBA) to all current smokers.‡‡ They ensure NRT is prescribed and offer a referral to a smoking cessation clinic, either as an inpatient or in the community.
- Pharmacists and pharmacy technicians are present on each ward and support junior doctors with the prescription of NRT.
- A pharmacist and a smoking cessation adviser from One You East Sussex, the local smoking cessation service provider, run a joint smoking cessation clinic once per week on the respiratory ward.
- An electronic referral form to One You East Sussex is available on the Integrated Clinical Environment (ICE) system and can be sent by all healthcare workers with the patient’s permission.
†† For this organisational audit, ‘smoking cessation service’ was defined as a formal smoking cessation programme, delivered in the hospital, either by hospital staff or a visiting smoking cessation practitioner. ‡‡ VBA is used as a smoking cessation intervention and is composed of three parts: a) asking and recording the patient’s smoking status; b) advising on the best way of quitting; and c) acting by offering a specialist referral and prescribing pharmacotherapy where appropriate. Healthcare professionals can provide VBA in as little as 30 seconds. For more information about VBA please visit: www.gov.uk/government/publications/preventing-ill-health-commissioning-for-quality-and-innovation/guidance-and-information-on-the-preventing-ill-health-cquin-and-wider-cquin-scheme Section 4: 7-day working
To see the data analysis in full, please access the data analysis and methodology report available at: www.rcplondon.ac.uk/copd-asthma-organisational-2018-19
Key standards:
- **NICE 2011 QS10 [QS10]**: People admitted to hospital with an exacerbation of COPD are cared for by a respiratory team and have access to a specialist early supported-discharge scheme with appropriate community support.¹
- **NICE 2013 QS25 [QS9]**: People admitted to hospital with an acute exacerbation of asthma have a structured review by a member of a specialist respiratory team before discharge.²
- **NICE 2019 NG115 [1.3.36]**: Consider physiotherapy using positive expiratory pressure devices for selected people with exacerbations of COPD, to help with clearing sputum.⁶
- **NICE 2019 NG115 [1.2.98]**: It is recommended that the multidisciplinary COPD team includes respiratory nurse specialists.⁶
Audit results – ICU outreach provision:
- An ICU outreach service is provided for critically ill cases requiring ICU management on weekdays in 88% of hospitals, on weekends in 84% of hospitals and out of hours in 59% of hospitals.
- 12% of hospitals do not provide an ICU outreach service.
Audit results – specialty triage to respiratory medicine provision:
- Operation of a system of specialty triage of patients to respiratory medicine is available on weekdays in 60% of hospitals, on weekends in 42% of hospitals, and out of hours in 22% of hospitals.
- 40% of hospitals operate no specialty triage of patients to respiratory medicine.
Audit results – on-call respiratory consultant provision:
- An on-call respiratory consultant is available on weekdays in 53% of hospitals, on weekends in 30% of hospitals and out of hours in 22% of hospitals.
- 46% of hospitals do not have an on-call respiratory consultant.
Audit results – new-patient ward rounds by senior decision makers:
- The provision of new-patient ward rounds by senior decision makers (ST3 or above) from the respiratory team are as follows:
- **on acute medical units (AMUs):**
- 53% of hospitals undertake new-patient ward rounds on weekdays and 22% of hospitals do so on weekends. In 5% of hospitals new-patient ward rounds are undertaken during out of hours.
- **on respiratory wards:**
- 93% of hospitals undertake new-patient ward rounds on weekdays and 32% of hospitals do so on weekends. In 6% of hospitals, new-patient ward rounds are undertaken during out of hours. on other wards:
- 41% of hospitals undertake new-patient ward rounds on weekdays, 12% on weekends and 3% during out of hours.
Audit results – respiratory nurse provision:
- 89% of hospitals provide respiratory nurse(s) review on weekdays for asthma patients and 93% provide this for COPD patients. This is lower on weekends for asthma and COPD patients (19% and 30% respectively).
- 1% of hospitals have respiratory nurse availability for these patients in out of hours.
Audit results – inpatient physiotherapist provision:
- 95% of hospitals provide inpatient physiotherapist review on weekdays for asthma patients, and 96% for COPD patients. This is lower on weekends for asthma and COPD patients (70% and 72% respectively).
- Out of hours, inpatient physiotherapist availability for asthma and COPD patients is lower (50% and 51% respectively). Case study – Northern General Hospital (Sheffield Teaching Hospitals NHS Foundation Trust)
Northern General Hospital aims to deliver a specialist, 7 day a week consultant-led respiratory service, maximising specialist nursing input.
- Patients are identified for specialist respiratory care by addition to a list on an electronic white board.
- Patients are triaged to the respiratory list from the emergency department (ED) or via the single point of access for community referrals.
- The white board also separately records general patient reviews, and reviews on the respiratory post-take ward round (PTWR) delivered by consultant respiratory physicians.
- Usual review is on an acute medical unit (AMU) before transfer to a base respiratory ward, but reviews also occur at other locations (ED, clinical decision unit, non-respiratory base ward).
- A PTWR commences at 8am, 365 days per year, and sees all respiratory admissions from the last 24 hours not yet seen by a consultant.
- A ‘hot take’ after PTWR, seeing new respiratory admissions and problem solving, occurs until 7pm on weekdays.
- On consultant PTWR, a green-coloured PTWR sheet, detailing the summary of investigations, diagnosis and clear management plan, is added to the paper patient records.
For patients with COPD
- Admissions with (or likely to have) COPD are identified daily from the electronic white board by COPD specialist nurses, 365 days per year.
- Patients are reviewed on the same day by specialist nurses who check diagnosis, review treatment, check inhaler technique, provide education, refer to smoking cessation / pulmonary rehabilitation / community respiratory / mental health teams and triage to early supported discharge. Repeat visits are provided as required.
- The nursing team complete a single page pro forma, added to the notes alongside the consultant PTWR plan including lung function, historical oxygen saturations and appropriate input post discharge.
- Electronic notes are also made on SystemOne; these are shareable with the community team who may receive referrals. This is visible to two-thirds of Sheffield GPs.
- A weekly multidisciplinary team (MDT) meeting (between hospital and community team colleagues) reviews patients from this process.
For patients with asthma
- Asthma nurse specialists review the electronic white board twice daily during week days and visit patients identified as being admitted with asthma.
- Nurses carry out a review of diagnosis and management which includes a review of concordance and inhaler technique.
- Patient education is undertaken with advice about the need for early primary care review; all patients reviewed are supplied with an Asthma UK action plan. Complex patients with asthma are discussed at the weekly Asthma MDT.
Documents to note each of the specialist reviews referred to above are available at: www.rcplondon.ac.uk/copd-asthma-organisational-2018-19 Section 5: Management of care
To see the data analysis in full, please access the data analysis and methodology report available at: www.rcplondon.ac.uk/copd-asthma-organisational-2018-19
Key standards – managing respiratory failure (emergency oxygen therapy):
- **BTS 2017 [Guideline for oxygen use in healthcare and emergency settings – 11.1.2]**: Each hospital should have an agreed policy and protocol for oxygen prescribing to allow staff to adjust oxygen delivery devices and to give oxygen in emergency situations prior to the availability of a prescription.(^8)
- **BTS 2017 [Guideline for oxygen use in healthcare and emergency settings – 11.1.6]**: Every healthcare facility should have a standard oxygen prescription document or, preferably, a designated oxygen section on all drug-prescribing cards or guided prescription of oxygen in electronic prescribing systems.(^8)
- **BTS 2017 [Guideline for oxygen use in healthcare and emergency settings]**: All critically ill patients outside of a critical care area (e.g., intensive care unit (ICU), high-dependency unit (HDU), respiratory HDU) should be assessed and monitored using a recognised physiological track and trigger system such as the National Early Warning Score (NEWS).(^8)
- **BTS 2017 [Guideline for oxygen use in healthcare and emergency settings]**: Oxygen should be prescribed to achieve a target saturation of 94–98% for most acutely ill patients, or 88–92% or patient-specific target range for those at risk of hypercapnic respiratory failure.(^8)
Audit results – managing respiratory failure (emergency oxygen therapy):
- 96% of hospitals have an **oxygen policy** in place.(^{55})
- 98% of hospitals have a **designated place in which to record the prescription of oxygen** in the ward medication chart/record.(^{\*\*\*})
- **NEWS2** is used in 79% of hospitals as their system of early warning detection.
- Early warning detection charts allow target saturation to be recorded at 87% of hospitals, actual saturation to be recorded at 96% of hospitals and amount of oxygen administered to be recorded at 95% of hospitals.
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(^{55}) In the 2017 COPD organisational audit for England and Wales, 94% of hospitals had an oxygen policy in place.
(^{\*\*\*}) In the 2017 COPD organisational audit for England and Wales, 96% of hospitals had a designated place in which to record the prescription of oxygen in the ward medication chart/record.
### Non-invasive ventilation
| Key standards: | Audit results: | |-------------------------------------------------------------------------------|----------------------------------------------------| | **BTS 2018 (Acute NIV in adults [QS1]):** Acute non-invasive ventilation (NIV) should be offered to all patients who meet evidence-based criteria. Hospitals must ensure there is adequate capacity to provide NIV to all eligible patients.⁹ | 7% of hospitals report not meeting this. | | **BTS 2018 (Acute NIV in adults [QS2]):** All staff who prescribe, initiate or make changes to acute NIV treatment should have evidence of training and maintenance of competencies appropriate for their role.⁹ | 26% of hospitals report not meeting this. | | **BTS 2018 (Acute NIV in adults [QS3]):** Acute NIV should only be carried out in specified clinical areas designated for the delivery of acute NIV.⁹ | 9% of hospitals report not meeting this. | | **BTS 2018 (Acute NIV in adults [QS4]):** Patients who meet evidence-based criteria for acute NIV should start NIV within 60 minutes of the blood gas result associated with the clinical decision to provide NIV and within 120 min of hospital arrival for patients who present acutely.⁹ | 34% of hospitals report not meeting this. | | **BTS 2018 (Acute NIV in adults [QS5]):** All patients should have a documented escalation plan before starting treatment with acute NIV. Clinical progress should be reviewed by a healthcare professional with appropriate training and competence within 4 hours of starting NIV and by a consultant with training and competence in acute NIV within 14 hours of starting acute NIV.⁹ | 26% of hospitals report not meeting this. | | **BTS 2018 (Acute NIV in adults [QS6]):** All patients treated with acute NIV should have blood gas analysis performed within 2 hours of starting acute NIV. Failure of these blood gas measurements to improve should trigger specialist healthcare professional review within 30 minutes.⁹ | 25% of hospitals report not meeting this. | Key standards – pulmonary rehabilitation
- **BTS 2014 Quality standards for pulmonary rehabilitation [QS3]**: People admitted to hospital with acute exacerbations of COPD (AECOPD) are referred for pulmonary rehabilitation at discharge.(^{10})
- **BTS 2014 Quality standards for pulmonary rehabilitation [QS3]**: People referred for pulmonary rehabilitation following admission with AECOPD are enrolled within 1 month of leaving hospital.(^{10})
- **NICE 2019 NG115 [1.2.81]**: Make pulmonary rehabilitation available to all appropriate people with COPD (see recommendation 1.2.82), including people who have had a recent hospitalisation for an acute exacerbation.(^{6})
- **NICE 2016 QS10 [QS5]**: People admitted to hospital for an acute exacerbation of COPD start a pulmonary rehabilitation programme within 4 weeks of discharge.(^{1})
Audit results – pulmonary rehabilitation:
- 84% of hospitals recorded that **provision of pulmonary rehabilitation for COPD patients takes place within the community**. 33% of hospitals have a **pulmonary rehabilitation service available** for their COPD patients **on site**, and **17% have an available service at another hospital**.(^{11})
- Of the hospitals that provide a pulmonary rehabilitation service (either at the hospital, at another hospital or within the community), 45% provide this service to COPD patients within 4 weeks of discharge from hospital.
- This would suggest that there has been no improvement in availability of pulmonary rehabilitation within 4 weeks of discharge over the last 2 years.
(^{11}) Hospitals were able to select more than one location option for the following dataset question: *Is there a pulmonary rehabilitation service available to COPD patients discharged following exacerbation from the hospital?* Section 6: Integrating care
To see the data analysis in full, please access the data analysis and methodology report available at: www.rcplondon.ac.uk/copd-asthma-organisational-2018-19
Key standards – severe asthma service:
BTS/SIGN 2019 \[4.3.4\]: Patients requiring frequent or continuous use of oral corticosteroids should be under the care of a specialist asthma service.5
NICE 2018 QS25 \[QS5\]: People with suspected severe asthma are referred to a specialist multidisciplinary severe asthma service.2
NRAD 2014 \[Organisation of NHS Services, Recommendation 2\]: Patients with asthma must be referred to a specialist asthma service if they have required more than two courses of systemic corticosteroids, oral or injected, in the previous 12 months or require management using British Thoracic Society (BTS) stepwise treatment 4 or 5 to achieve control.4
Audit results – severe asthma service:
• 39% of hospitals have a severe asthma service. Of the 61% of hospitals that do not, only 86% have a referral pathway to a severe asthma service.
Key standards – integrating care:
• NICE 2011 QS10 \[QS10\]: People admitted to hospital with an exacerbation of COPD are cared for by a respiratory team and have access to a specialist early supported-discharge scheme with appropriate community support.1
• NICE 2016 QS10 \[QS3\]: People with stable COPD and a persistent resting stable oxygen saturation level of 92% or less have their arterial blood gases measured to assess whether they need long-term oxygen therapy.1
• NICE 2018 NG92 \[1.1.1\]: Use sustainability and transformation plans, health and wellbeing strategies, and any other relevant local strategies and plans to ensure evidence-based stop smoking interventions and services are available for everyone who smokes.7
Audit results: outreach and in-reach early/supported discharge‡‡‡
• 52% of hospitals provide an outreach early/supported discharge service that is delivered by a hospital team that works jointly with a community team and 27% of hospitals do not provide this service. 25% of hospitals selected that this service was delivered by a hospital team.
• 54% of hospitals provide an in-reach early/supported discharge service that is delivered by a community team that works jointly with a hospital team and 39% of hospitals do not provide this service. 11% of hospitals selected that this service was delivered by a community team.
‡‡‡ Please note that these figures combined add up to 104%. This is likely due to data entry error as the answer options for the relevant question within the dataset (Which services are provided by whom?) followed a ‘tick all that apply’ format. Audit results: admissions avoidance
- 26% of hospitals provide an admissions avoidance service delivered by a single team that works across the primary/secondary care interface.
Audit results: oxygen assessment service
- 35% of hospitals provide an oxygen assessment service delivered by a single team that works across the primary/secondary care interface.
Medicines management service
- 17% of hospitals provide a medicines management service that is delivered by a single team that works across the primary/secondary care interface.(^{555})
Chronic disease management service
- 24% of hospitals provide a chronic disease management service that is delivered by a single team that works across the primary/secondary care interface.
Smoking cessation advice
- 19% of hospitals provide a smoking cessation service that is delivered by a single team that works across the primary/secondary care interface.
Audit results – developing integrated respiratory services:
- 33% of hospitals have sessional time devoted to developing integrated respiratory services in the area.
- Of these hospitals, represented staff members who have designated responsibility for developing these services include: respiratory consultants (65%), respiratory specialist nurses (39%), integrated care respiratory consultants (32%) and respiratory physiotherapists (27%).
Key standards – multidisciplinary team meetings for COPD:
- NICE NG115 \[1.2.96\]: COPD care should be delivered by a multidisciplinary team.(^6)
- NICE NG115 \[1.2.98\]: It is recommended that the multidisciplinary COPD team includes respiratory nurse specialists.(^6)
Audit results – multidisciplinary team (MDT) meetings for COPD:
- 58% of hospitals hold a regular MDT meeting between the hospital and community teams for patients with COPD.
- Of these hospitals, 49% host this meeting on a weekly basis and 24% host this on a monthly basis.
- Of these hospitals, represented staff members include: respiratory consultants (95%), community nurses (97%) and community physiotherapists (86%).
(^{555}) Medicines management includes the clinical, cost-effective and safe use of medicines to ensure that patients get the maximum benefit from the medicines they need, while at the same time minimising potential harm. Case study – University Hospital of Wales (Cardiff & Vale University Health Board)
- A weekly MDT meeting is led by the respiratory consultant alongside the community team comprising respiratory nurse specialists, physiotherapists and an occupational therapist. The MDT is coordinated by an administrative member of staff who emails the MDT list to the consultant, allowing the patient’s results, scans and old letters to be reviewed.
- The MDT offers an opportunity to discuss all aspects of management of COPD patients in the community who are currently under the care of the Community Respiratory Resource Unit (CRRU) team. This could include patients who have self-referred from the community, those who have been admitted to hospital and had their early discharge facilitated by the CRRU team, or those who have been referred by their GP or other healthcare professional to avoid an admission to hospital.
- The MDT discussion focuses on progress of the patient in the community, and whether they require changes to their medical management, further investigations, or referral to other specialties and therapies.
- Patients who are deemed suitable for pulmonary rehabilitation are discussed and referred at the MDT meeting if appropriate. Patients who are unable or unwilling to participate in pulmonary rehabilitation are provided with education and self-management techniques by the CRRU team.
- The MDT also provides the necessary support to the community team so that early discharge and admission avoidance patients can be managed safely in the community. In addition, it provides the team with an educational opportunity as results and radiology scans are reviewed and discussed there. Section 7: Patient and carer engagement
To see the data analysis in full, please access the data analysis and methodology report available at: www.rcplondon.ac.uk/copd-asthma-organisational-2018-19
Audit results – formal surveys:
- 28% of hospitals undertake a formal survey less than once a year, 11% undertake a formal survey 1–2 times a year and 10% undertake continuous surveys.\*\*\*\*
- 46% of hospitals never undertake a formal survey seeking patient/carer views on respiratory services.
Audit results – strategic group for respiratory:
- 69% of hospitals have a strategic group for respiratory services.
- Of these hospitals, 29% include patient representation on this group.
\*\*\*\* For the purposes of this audit, a formal survey excluded the friends and family test, but could be defined locally by hospital teams completing the organisational audit. Section 8: Transitional care
To see the data analysis in full, please access the data analysis and methodology report available at: www.rcplondon.ac.uk/copd-asthma-organisational-2018-19
Key standards:
- **BTS/SIGN 2019 [11.11.4]**: Transition services must be multidisciplinary and multiagency. Optimal care requires a cooperative working relationship between adult and paediatric services, particularly where the young person has complex needs with multiple specialty involvement.5
- **BTS/SIGN 2019 [11.11.4]**: Coordination of transitional care is critical. There should be an identified coordinator who supports the young person until he or she is settled within the adult system.5
- **BTS/SIGN 2019 [11.11.4]**: Transition services must address the needs of parents/carers whose role in their child’s life is evolving at this time.5
Audit results – transitional care:
- **30%** of hospitals have **formal transition arrangements in place** for young people with asthma moving from paediatric to adult services. Of these:
- 16% ensure the young person has a full record of their condition
- 18% ensure the young person’s GP is sent the same record
- 23% ensure the young person has a transition plan that has been agreed with both paediatric and adult clinicians
- 11% ensure the young person has a named case worker to assist in signposting for them and their family.
Case study – Colchester General Hospital (East Suffolk and North Essex NHS Foundation Trust):
In 2012 Colchester General Hospital appointed a paediatric transition nurse to develop a generic paediatric transition procedure to adapt for the continued management of young people with long-term health conditions. The procedure/policy was approved and has been embedded in practice since 2015.
- The transition nursing team now consists of a 1.0 WTE band 7 nurse, a 0.6 WTE band 6 nurse and a band 5 youth worker.
- The hospital has permission to use an adapted version of the ‘Ready, Steady, Go’ documentation, a transition programme, which is being rolled out across the NHS.††††
- The youth worker is developing a young people’s forum within the hospital; there is a national initiative to raise the profile of young people as an identified service user group.‡‡‡‡
†††† For more information about the ‘Ready, Steady, Go’ transition programme please visit: www.nice.org.uk/sharedlearning/implementing-transition-care-locally-and-nationally-using-the-ready-steady-go-programme ‡‡‡‡ Please visit the NHS England Youth Forum Impact report for more information, available at: www.england.nhs.uk/participation/get-involved/how/forums/nhs-youth-forum/ Colchester General Hospital pathway for the transition of children and young people to adult services
**Identify ‘key worker’** from the MDT; usually transition nurse
**Outpatient meeting set-up** with paediatrician, young person, family/carer and ‘key worker’:
- discuss transition and provide written information:
- set targets and goals
- work with ‘key worker’ to meet the goals.
**Yearly reviews** with paediatrician, young person, family/carer and ‘key worker’:
- review previous targets and goals and agree to either continue with these or set new targets and goals
- work with ‘key worker’ to meet the goals
- paediatrician to refer to adult team after 15th birthday.
**Yearly reviews / handover meeting** with paediatrician, adult team (physician and/or clinical nurse specialist), young person, family/carer and ‘key worker’:
- review transition programme and identify any unmet targets/goals
- ‘key worker’ to arrange a visit to adult inpatient/outpatient area with clinical nurse specialist.
**Commence management** in adult service area
- ‘key worker’ and/or clinical nurse specialist to attend first meeting in adult outpatients
- continue addressing health/transition targets.
Notify GP / practice nurse, safeguarding and other agencies as appropriate Section 9: Reimbursement for costs of care
To see the data analysis in full, please access the data analysis and methodology report available at: www.rcplondon.ac.uk/copd-asthma-organisational-2018-19
Audit results – reimbursement for costs of COPD care:
- For 46% of hospitals, reimbursement for costs of COPD care occurs via block contract, and for 32% of hospitals, reimbursement is via payment by results.
- For hospitals in England, 82% of trust local commissioners agree to make the best practice tariff (BPT) payment for COPD if the BPT is achieved.
- 11% of hospitals report that commissioners / health boards have agreed a Commissioning for Quality and Innovation (CQUIN) payment or local incentive payment (LIP) for COPD care.
Audit results – reimbursement for costs of asthma care:
- For 45% of hospitals, reimbursement for costs of asthma care is via block contract and for 34% of hospitals, reimbursement is via payment by results.
- 11% of hospitals report that commissioners have agreed a CQUIN or LIP for asthma care.
## Appendix A: Document purpose
| Document purpose | To disseminate the results of the national snapshot audit of the organisation and resourcing of adult asthma and COPD hospital services in England, Scotland and Wales 2018/19 | |------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | Title | COPD and adult asthma: 2019 organisational audit report | | Authors | National Asthma and Chronic Obstructive Pulmonary Disease Audit Programme (NACAP), Royal College of Physicians | | Publication date | March 2020 (TBC) | | Audience | Healthcare professionals, NHS managers, chief executives and board members, service commissioners, policymakers and voluntary organisations. | | Description | This report presents the results of the snapshot audit of the organisation and resourcing of adult asthma and COPD hospital services in England, Scotland and Wales which took place between 1 April 2019 and 1 July 2019. | | Supersedes | Not applicable | | Contact | [email protected] | Appendix B: References
01. National Institute for Health and Care Excellence. *Chronic obstructive pulmonary disease in adults. NICE quality standard 10 (QS10)*. London: NICE, 2011 (updated 2016) www.nice.org.uk/guidance/qs10/chapter/List-of-quality-statements [Accessed October 2019]
02. National Institute for Health and Care Excellence. *Asthma. NICE quality standard 25 (QS25)*. London: NICE, 2013 (updated 2018) www.nice.org.uk/guidance/qs25/documents/previous-version-of-quality-standard-2 [Accessed October 2019]
03. Stone RA, Holzhauer-Barrie J, Lowe D et al. *COPD: Who cares? National Chronic Obstructive Pulmonary Disease (COPD) Audit Programme: resources and organisation of care in acute NHS units in England and Wales 2014. National organisational audit report*. London: RCP, 2014.
04. Royal College of Physicians. *Why asthma still kills: the National Review of Asthma Deaths (NRAD) Confidential Enquiry report*. London: RCP, 2014.
05. British Thoracic Society (BTS) / Scottish Intercollegiate Guidelines Network (SIGN). *SIGN 153: British guideline on the management of asthma – A national clinical guideline*. [Updated July 2019]. www.brit-thoracic.org.uk/quality-improvement/guidelines/asthma/ [Accessed October 2019].
06. National Institute for Health and Care Excellence. *Chronic obstructive pulmonary disease in over 16s: diagnosis and management. NICE guideline 115 (NG115)*. London: NICE, 2018 [updated July 2019] www.nice.org.uk/guidance/NG115 [Accessed October 2019].
07. National Institute for Health and Care Excellence. *Stop smoking interventions and services. NICE guideline 92 (NG92)*. London: NICE, 2018. www.nice.org.uk/guidance/ng92/ [Accessed October 2019].
08. O’Driscoll BR, Howard LS, Earis J, Mak V. BTS guideline for oxygen use in adults in healthcare and emergency settings. *Thorax* 2017;72:i1–i90. www.brit-thoracic.org.uk/quality-improvement/guidelines/emergency-oxygen/ [Accessed October 2019].
09. Davies M, Allen M, Bentley A et al. British Thoracic Society Quality Standards for acute non-invasive ventilation in adults. *BMJ Open Resp Res* 2018;5:e000283. www.brit-thoracic.org.uk/quality-improvement/quality-standards/niv/ [Accessed October 2019].
10. British Thoracic Society (BTS). *Quality Standards for Pulmonary Rehabilitation in Adults*. British Thoracic Society Reports. Vol.6 No.2. May 2014. www.brit-thoracic.org.uk/quality-improvement/quality-standards/pulmonary-rehabilitation/ [Accessed October 2019]. National Asthma and COPD Audit Programme (NACAP)
Royal College of Physicians 11 St Andrews Place Regent’s Park London NW1 4LE
+44 (020) 3075 1526 [email protected]
www.rcplondon.ac.uk/nacap
@NACAPaudit #NACAPQI #AdultAsthmaAudit #COPDAudit
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d8904e159844854add97d8cc3f1661fbad0656b3 | Contents
Contents 2 Introduction 3 Executive Summary 9 Deaths reported 10 Post-mortem examinations held and inquests opened 12 Inquests Completed 18 Treasure and Treasure Trove 27 Annex A: Map of coroner areas in England and Wales, 2013 29 Annex B: Further analysis 31 Explanatory notes 33 Contacts 36 Introduction
This annual bulletin presents statistics of deaths reported to coroners in England and Wales in 2014. Information is provided on the number of deaths reported to coroners, post-mortem examinations, inquests opened, and inquests concluded. Information is provided on the number of deaths reported to coroners, post-mortem examinations and inquests held, and conclusions recorded at inquests. The data are collected via statistical returns completed by coroners. For previous editions of this report please see:
www.gov.uk/government/collections/coroners-and-burials-statistics
This publication should be read alongside the statistical tables which accompany it, also found via the link above. There is also a supporting CSV file to allow users to do their own analysis.
In addition to the bulletin and tables we have published a coroners statistical tool (also available at the link above). The tool provides easier access to local level data and allows the user to compare up to four areas of interest, for example it is possible to compare a coroner area with a geographical region, England or Wales.
The Explanatory Notes section at the end of this bulletin provides information about statistical revisions, and the symbols and conventions used.
If you have any feedback, questions or requests for further information about the bulletin, please direct them to the appropriate contact given at the end of this report.
The legislation
Coroner services in England and Wales are governed by Part 1 of the Coroners and Justice Act 2009 (the 2009 Act), as well as the rules and regulations made under it. The 2009 Act came into force in July 2013, largely replacing the Coroners Act 1988(^1) (the 1988 Act).
The 2009 Act and its rules and regulations can be accessed via the links below:
www.legislation.gov.uk/ukpga/2009/25/contents
www.legislation.gov.uk/2013?title=coroners
(^1) The Coroners Act 1988 was repealed in July 2013 with the exceptions of section 13 (application for a fresh coroner investigation or inquest) and 4A(8) (a coroner in Wales being regarded as a coroner for the whole of Wales). Chief Coroner
The 2009 Act created the post of Chief Coroner to provide judicial oversight of the coroner system and leadership, guidance and support to coroners. The Chief Coroner’s main statutory responsibilities are to:
- approve all coroner appointments (along with the Lord Chancellor);
- keep a register of coroner investigations lasting more than 12 months;
- collate, monitor and publish coroners’ reports to authorities to prevent future deaths; and
- give the Lord Chancellor an annual report, which is published and laid before Parliament (see ‘Chief Coroner’s annual report’ section below).
On 8 April 2015, it was announced that the Lord Chief Justice, after consultation with the Lord Chancellor, has extended the term of office of His Honour Judge Peter Thornton QC as Chief Coroner of England and Wales to 1 October 2016.
Further information on the Chief Coroner is available at:
www.judiciary.gov.uk/about-the-judiciary/office-chief-coroner
Coroner areas and structure
Under the 2009 Act, each coroner area has one senior coroner, and one or more assistant coroners. A coroner area may also have an area coroner (who may function as a deputy to the senior coroner).
For information on changes to coroner areas, please see Annex B.
Investigations
Under the 2009 Act, a coroner conducts an ‘investigation’ into a death (which may or may not include an inquest). Much of the coroner’s investigation takes place before any formal inquest hearing, and includes the coroner considering whether the duty to hold an inquest applies to an individual case.
A coroner has a duty to investigate a death if:
1. the coroner is made aware that the body is within that coroner’s area, and
2. the coroner has reason to suspect that: a) the deceased died a violent or unnatural death; b) the cause of the death is unknown; or c) the deceased died while in custody or state detention.
The coroner must then establish who has died and how, when, and where they died. A coroner’s inquest is held for all deaths in custody or state detention. An inquest with a jury is held where the deceased died while in custody or state detention and the death was violent or unnatural, or of unknown cause; where the death resulted from an act or omission of a police officer or member of a service police force in the purported execution of their duties; or where the death was caused by an accident, poisoning or disease which must be reported to a government department or inspector. Jury inquests are not required where the deceased died in custody but from natural causes.
Once the post-mortem examination (including any histology or toxicology) has concluded, the coroner must decide how to proceed. There are three main options:
- The post-mortem examination reveals that the deceased died of natural causes and the coroner thinks that it is not necessary to (investigate or) continue the investigation. There will be no inquest.
- The post-mortem examination reveals that the deceased died of natural causes but the coroner considers that it is necessary to (investigate or) continue the investigation. The coroner must then hold an inquest.
- After the post-mortem examination, the coroner (still) has reason to suspect that the deceased died a violent or unnatural death, or the cause of death is unknown, or the deceased died while in custody/state detention. The coroner must then hold an inquest.
**Inquest conclusions**
At the end of an inquest, the coroner (or jury if applicable) completes a form entitled ‘Record of an inquest’. This form documents the ‘conclusion’ of the coroner or jury as to who died and how, when, and where they died.(^2)
A conclusion consists of the legal ‘determination’, which states who died, and where, when and how they died; and ‘findings’ which allow the cause of death to be registered. The coroner or jury may use one of the following short form conclusions(^3):
- accident or misadventure
- alcohol/drug related
- industrial disease
______________________________________________________________________
(^2) The 1988 Act term ‘verdict’ was replaced by the 2009 Act term ‘conclusion’.
(^3) ‘Alcohol/drug related’ and ‘road traffic collision’ are new short form inquest conclusions under the 2009 Act, which came into effect from 2013. They have been presented for the first time in this publication. Coroners Statistics 2014
- lawful killing
- unlawful killing
- natural causes
- open
- road traffic collision
- stillbirth
- suicide
**Suspension of investigation / adjournment of inquest**
Under Schedule 1 to the 2009 Act a coroner must suspend an investigation (and if an inquest has been opened, adjourn that inquest) in the following circumstances:
- If asked to do so by a prosecuting authority because someone may be charged with a homicide or related offence involving the death of the deceased (paragraph 1 of Schedule 1);
- When criminal proceedings have been brought in connection with the death (paragraph 2 of Schedule 1);
- Where there is an inquiry under the Inquiries Act 2005 (paragraph 3 of Schedule 1);
- If it appears to the coroner that it would be appropriate to do so (paragraph 5 of Schedule 1).
**Chief Coroner’s annual report**
The Chief Coroner’s annual report to the Lord Chancellor is a statement on the coroner system for the previous calendar year. It must contain an assessment of consistency of standards between coroner areas; information about investigations that have taken over 12 months to complete; and a summary of reports to prevent future deaths and the responses to these (previously known as Rule 43 reports). The annual report is published on the Chief Coroner’s section of the judiciary website. The Chief Coroner’s first annual report was published in July 2014.
Coroners are therefore now required to notify the Chief Coroner of any investigation that lasts more than a year and to notify the Chief Coroner of the date on which any such investigation was subsequently concluded.
______________________________________________________________________
4 [www.judiciary.gov.uk/related-offices-and-bodies/office-chief-coroner/chief-coroners-annual-report-2013-14/](http://www.judiciary.gov.uk/related-offices-and-bodies/office-chief-coroner/chief-coroners-annual-report-2013-14/) Further information
For further background information on coroners and a flow-chart detailing the possible outcomes involved when a death is reported to a coroner, please refer to ‘A Guide to Civil and Administrative Justice Statistics’, which is available at:
www.gov.uk/government/statistics/guide-to-civil-and-administrative-justice-statistics
A Glossary providing brief definitions for some of the terms used in this bulletin can also be found at the link above.
Related statistics
All deaths in England and Wales must be registered with the Registrar of Births and Deaths. For those deaths where a coroner conducts an inquest, the death will be registered at the conclusion of the inquest, and the cause of death classified according to the conclusion recorded by the coroner. Statistics on registered deaths in England and Wales are published by the Office for National Statistics (ONS) in their series on mortality statistics. These can be accessed from the ONS website at:
www.ons.gov.uk/ons/taxonomy/index.html?nscl=Mortality+Rates
For summaries of monthly figures, please see:
www.ons.gov.uk/ons/rel/vsob2/monthly-figures-on-deaths-registered-by-area-of-usual-residence--england-and-wales/index.html
The Ministry of Justice’s coroner statistics differ from ONS figures because they count two different, albeit related, events. The Ministry of Justice’s coroner statistics provide the number of deaths which are reported to coroners in England and Wales. These include deaths reported to coroners which occurred outside England and Wales. The ONS’ mortality statistics, based on death registrations, report the number of deaths registered (irrespective of whether a coroner has investigated) in England and Wales in a particular year, and therefore do not include deaths that occurred outside England and Wales.
The proportion of deaths which are reported to coroners has been estimated using death registration figures published by ONS. Estimates for 2014 have been calculated using ONS’ monthly provisional figures on death registrations, while percentages for 2013 and earlier years have been calculated using final annual death registration figures for the relevant year.
5 Statistics on the number of registered deaths in England and Wales are published by the Office for National Statistics. A final figure for the total number of registered deaths in 2014 has not yet been published, so a provisional figure from ONS, derived from the monthly figures for death registrations in England and Wales, has been used. This publication includes figures for deaths which occurred in state custody. Statistics on deaths in prison custody are also published by the National Offender Management Service (NOMS), accessible via the following link:
www.gov.uk/government/collections/safety-in-custody-statistics
The figures for deaths in custody in this publication relate only to those deaths which have been reported to a coroner and then reported to MoJ, whereas the NOMS publication includes all deaths which have occurred in prison custody and those which occurred whilst the offender was released on temporary licence for medical reasons. Executive Summary
Key Findings
- 223,841 deaths were reported to coroners in 2014, a decrease of 4,143 (2%) from 2013, reflecting in part the fall in the number of registered deaths(^6) from 2013 to 2014 (down 1%).
- Just under half (45%) of all registered deaths(^6) were reported to coroners in 2014, the same level as seen in 2013. Over the last ten years this proportion has been relatively consistent, within the range of 45% to 47%.
- The number of inquests opened in 2014 reduced by 14% to 25,889, which coincide with the Coroners Act 2009 coming into effect in July 2013. This means coroners can now conduct a brief investigation prior to deciding whether an inquest should take place.
- Post-mortem examinations were ordered by coroners in 40% of all cases reported to them in 2014, down by one percentage point since 2013 and consistent with the long-term downward trend. Since 1995, the proportion of post-mortems ordered has decreased by 21 percentage points, from 61% to 40%
- In 2014, the proportion of post-mortems conducted in inquest cases was 76%, down eight percentage points on 2013. Following the implementation of the Coroners Act 2009 in July 2013, coroners are allowed to hold post-mortems as part of a brief investigation before deciding if an inquest needs to be opened which may account for the drop in the figures.
- Despite a fall of 8% in the total number of conclusions recorded (in part due to the fall in the number of deaths reported to coroners), the number of suicide conclusions in 2014 has increased by almost 3% from 2013 and has been steadily rising since 2007.
- Just three of the ten possible inquest conclusion short forms account for almost 62% of all conclusions recorded (accident and misadventure: 27%, unclassified: 18% and natural causes: 17%).
- Between 2010 and 2013, ‘natural causes’ was the most commonly used inquest conclusion - however compared with 2013, the number of natural causes fell by 45% in 2014. This may partly be due to the decrease in the number of cases reported to coroners, but in addition, may also be due to the Coroners Act 2009 coming into effect in July 2013. This means that coroners can now issue a death certificate without holding an inquest when it is known that a death has occurred naturally.
- The estimated average time taken to process an inquest in 2014 (from the date the death was reported until the conclusion of the inquest, where the death occurred in England and Wales) was 28 weeks, with a minimum of 3 weeks and maximum 53 weeks across coroner areas.
______________________________________________________________________
(^6) A provisional figure for the number of registered deaths in England and Wales has been used, derived from monthly figures produced by the Office for National Statistics. Deaths reported
The number of deaths reported to coroners in 2014 fell by 4,143 (2%) from the previous year - from 227,984 in 2013 to 223,841 in 2014 which reflects in part the decrease in the number of deaths registered in England and Wales (down 1%). The proportion of registered deaths in 2014 that were reported to coroners was an estimated 45%, no change from 2013 and stabilising the slight downward trend seen over the last few years.
Figure 1: Registered deaths and deaths reported to coroners, England and Wales, 2004-2014
Over the last decade, the number of registered deaths in England and Wales has decreased from 512,993 in 2005 to 500,122(^7) in 2014; however the number has fluctuated in recent years. The number of deaths reported to coroners has also fluctuated over the last ten years with 232,401 deaths reported in 2005, rising to a high of 234,784 in 2008. The figure then fell to 222,371 in 2011, rising briefly to 227,984 in 2013 before falling to 223,841 in 2014.
Map 1 below shows deaths reported in each coroner area in 2014 as a percentage of the total deaths in each area(^8).
______________________________________________________________________
(^7) Provisional figure based on ONS monthly death registration figures for 2014
(^8) The reported deaths figure for 2014 is provisional, based on ONS monthly death registration figures Map 1: Deaths reported to coroners as a percentage of total deaths in each area, England and Wales, 2014
The proportion of deaths reported to the coroner varies from 24% in Hartlepool and North and East Cambridgeshire to 96% in Blackburn, Hyndburn and Ribble Valley.
9 Map does not include the Isles of Scilly due to small numbers.
10 The ONS death registration figures are based on area of usual residence whereas the coroners’ figures are based on the area where a person died. Therefore the coroner office for the City of London may shows a distorted figure of 264% due to the low levels of residence and high level of commuters. Post-mortem examinations held and inquests opened
Post-mortems were held for 89,875 deaths reported to coroners in 2014, down 4,580 (5%) from 2013.
Post-mortem examinations were ordered by coroners in 40% of all cases reported to them in 2014, down by one percentage point from 2013, and consistent with the existing long-term downward trend. Since 1995, the proportion of post-mortems ordered has decreased by 21 percentage points, from 61% to 40% (see Table 3).
Inquest cases represented 12% of all the deaths reported to coroners in 2014, a decrease of 1 percentage point from 2013. Although this difference in proportion seems small, the actual number of inquests that were opened in 2014 fell 14% to 25,899 compared to 2013. In July 2013, the Coroners Act 2009 came into effect which allowed coroners to conduct a brief investigation prior to making a decision on whether an inquest should be opened. This allowed coroners to close cases without having to hold an inquest.
Figure 2: Post-mortems and inquests as a percentage of deaths reported to coroners, England and Wales, 2004-2014 Map 2: Post-mortems held as a proportion of deaths reported to coroners, England and Wales, 2014
The proportion of post mortems carried out varies from 22% in the Wirral to 62% in North East Kent.
11 Map does not include Isles of Scilly due to small numbers Map 3: Inquests opened as a proportion of deaths reported to coroners, England and Wales, 2014
The proportion of inquests carried out varies from 5% in Gwent to 22% in City of London.
______________________________________________________________________
12 Map does not include Isles of Scilly due to small numbers Post-mortems in inquest cases
When an inquest is opened, a post-mortem examination has usually been conducted. In 2014, around three quarters of inquest cases involved a post-mortem, down eight percentage points on 2013 continuing the declining trend seen over the past decade (from 94% in 2005). Historically it was quite rare for an inquest to be opened without a post-mortem; however, since 1997 this proportion has been gradually increasing, with a sharp increase seen this year (from 16% to 24% of all inquest cases in 2013 and 2014 respectively) which may be attributed to the provisions in the Coroners Act 2009 which came into effect in July 2013, allowing a coroner to conduct a brief investigation (including a post mortem) prior to making a decision on whether to hold a formal inquest. These are captured in the potential inquest cases below.
Post-mortems in non-inquest cases
In the majority (87%) of cases referred to coroners, there is no inquest. In 2014 there were 67,108 non-inquest cases where a post-mortem was held. The percentage of non-inquest cases that required a post-mortem has remained at 34% for the past three years although this proportion has fallen steadily prior to this; in 2005 it was 43%.
Post-mortems in potential inquest cases
Prior to July 2013, cases were either categorised as ‘inquest’ or ‘non-inquest’ cases. Changes in the way coroners are able to conduct an investigation mean that there is now a third category of ‘potential inquest’ cases. This means that the coroner is investigating the death, but has not yet decided whether it is necessary to hold an inquest. Depending on whether or not the coroner deems it necessary to hold an inquest, these cases will all eventually end up in either the ‘inquest’ or ‘non-inquest’ category.
As of 31 December 2014, there were 3,198 potential inquest cases being dealt with by coroners in England and Wales with almost all (95%) requiring a post-mortem.
Cases requiring neither an inquest nor a post-mortem
There were 127,646 cases reported to coroners where there was neither an inquest nor a post-mortem. This type of case has generally been increasing in number in recent years (in 2005 there were 116,047 such cases), although this year has seen a slight decrease from 2013 (down 1,056 or less than 1%). The proportion of cases where there was neither an inquest nor a post-mortem examination has increased, as a proportion of all deaths reported to coroners, from 50% in 2005, to 57% in 2014. Post-mortem rates\\textsuperscript{13}, histology\\textsuperscript{14} and toxicology\\textsuperscript{15}
Post-mortems can be classed as either standard or non-standard, depending on the cost of the examination. A non-standard post-mortem is charged at a higher rate than a standard post-mortem and is defined as a post-mortem which requires special skills. A non-standard post-mortem could, for example, require a paediatric or specialist pathologist. In 2014, almost all (95%) of post-mortems were ordered at a standard rate - this has remained at the same level since 2011.
In 2014, 18,433 post-mortems included histology; and despite a decrease in the overall number by 653 from last year, the proportion of post-mortems which included histology increased by one percentage point to 21% of all post-mortems. In 2014, 13,704 post-mortems held included toxicology (15% of post-mortems held), which was 419 more than in 2013, an increase of one percentage point. This follows the slow rising trend seen since 2011.
Out of England Orders
To remove a body of a deceased person out of England and Wales, notice must be given to the coroner within whose area the body is lying. When the coroner gives permission for the removal of a body, an Out of England order is issued.
Coroners issued 5,232 Out of England orders in 2014, compared with 5,051 issued in 2013. In both years the number of orders issued represented 2% of the total number of deaths reported to coroners which has not changed since 2011 (see Table 5).
Deaths abroad
Of the 223,841 deaths reported to coroners in 2014, some 1,860 (less than 1%) were reports of deaths that had occurred outside England and Wales. This has remained at the same level since 2011.
\\textsuperscript{13} The fee charged by a pathologist for a standard rate post-mortem is currently £96.80. Non-standard post-mortems cost £276.90.
\\textsuperscript{14} Histology in the context of post-mortems is the examination of tissues under a microscope.
\\textsuperscript{15} Toxicology in the context of post-mortems is the study of body fluids and tissues for the detection of drugs. Deaths in State Detention
In 2014 a total of 352 deaths were reported to coroners which occurred in state detention\\textsuperscript{16}; 1% of the total number of deaths reported. Deaths in prison custody and mental health act detention account for 91% of all deaths in state detention cases (63% and 28% respectively).
Figure 3: Deaths in State Detention by type, England and Wales, 2014\\textsuperscript{17}
\\textsuperscript{16} This data only represents deaths in custody which were referred to a coroner and subsequently reported to MoJ in the coroner’s annual return.
\\textsuperscript{17} There were no deaths within “Local authority secure children’s homes” Inquests Completed
Conclusions were recorded for 29,153\\textsuperscript{18} inquests in 2014, down by 2,426 (8%) from 2013, reversing the continuing upward trend seen since 1996. The conclusions recorded in 2014 may relate to cases opened in 2014 or earlier years. Almost all inquests have a conclusion recorded (98%) and this has remained at the same level since 2012.
Historically the most common conclusions (in order of frequency observed) were death from natural causes, death by accident or misadventure and unclassified conclusions. In 2014 the most common conclusions (by order of frequency) were death by accident and misadventure (7,941 or 27%), Unclassified (5,261 or 18%) and death by natural causes (4,873 or 17%).
**Figure 4: Conclusions recorded at inquest, by category, England and Wales, 2014\\textsuperscript{19}**
\*Killed unlawfully, Killed lawfully, Attempted or self-induced abortion, Cause of death aggravated by lack of care, or self-neglect, Want of attention at birth, Stillborn, Disasters
\\textsuperscript{18} This includes a small discrepancy with the data received from the West London coroners office, therefore, the sum of conclusion types may not equal the total number reported.
\\textsuperscript{19} Figures may not equal 100% due to rounding. The conclusion of death by natural causes fell by 4,008 or 45% compared to 2013. This may partly be due to the decrease in the number of cases reported to coroners, but in addition, may also be due to the Coroners Act 2009 coming into effect in July 2013. This means that coroners can now issue a death certificate without holding an inquest when it is known that a death has occurred naturally.
There has been a small drop in the number of unclassified conclusions (82 cases, or 2%), however the proportion of all conclusions recorded as unclassified increased to 18%, continuing the ongoing steady rise from 1% in 1995. The rise in proportion of unclassified conclusions is partly due to the increasing use of what are known as ‘narrative conclusions’ by some coroners. A narrative conclusion is where at the end of the inquest, instead of a conventional conclusion, the coroner records a factual record of how and in what circumstances the death occurred. In these cases the conclusion is recorded as unclassified. As well as narrative conclusions, this category includes short non-standard conclusions which a coroner or jury might return when the circumstances do not easily fit any of the standard conclusions.
Two new short form conclusions have been introduced this year: drugs/alcohol related and road traffic collision. These conclusions accounted for 8% of all conclusions recorded (1,645 for Drugs/Alcohol related and 602 for Road Traffic collision).
______________________________________________________________________
20 An analysis on unclassified conclusions can be found in the Coroners Statistics 2012 publication (Annex A), available at: www.gov.uk/government/publications/coroners-statistics There are four main trends in the proportion of conclusions recorded by coroners over the last decade:
- Unclassified conclusions (including narratives, as explained above) accounted for 7% of all conclusions in 2005, but have since risen steadily to account for 18% of all conclusions in 2014.
- Conclusions of death by accident or misadventure have been declining steadily, from 35% of conclusions in 2005 to 26% in 2013; however there has been a small rise to 27% in 2014.
- Open conclusions have been decreasing over the same period, particularly over the last few years - they accounted for 6% in 2014 compared with 9% in 2005; and
- Despite a fall from 12% of all conclusions in 2005 to 11% of all conclusions in 2007, the proportion of inquests that have been concluded as suicide have slowly risen to 13% of all conclusions in 2014.
______________________________________________________________________
21 for years 2004-2013, this includes the previously used conclusions “dependence on Drugs” and “Non-dependence on Drugs”
24 The fall in natural causes in 2014 may be partly due to the fall in the total number of deaths referred to the coroner and partly due to the introduction of the two new conclusions “Drugs/Alcohol Related” and “Road Traffic Collision”.
25 The rise for “All other conclusions” in 2014 is due to the inclusion of the two new conclusions “Drugs/Alcohol Related” and “Road Traffic Collision”. Map 4: Suicide conclusions as a proportion of all inquest conclusions, England and Wales, 2014
The proportion of conclusions recorded as suicide varies from 4% in Peterborough to 31% in East Sussex and Ceredigion.
Differences in conclusions recorded by sex
The pattern of conclusions recorded differs between males and females. Male deaths accounted for around two thirds of all conclusions recorded in 2014,
______________________________________________________________________
22 Map does not include Isles of Scilly due to small numbers however they accounted for just over half of deaths reported; this suggests that males are more likely to die in circumstances that lead to an inquest. Female deaths accounted for about 34% of all conclusions recorded in 2014 (and 46% of deaths reported).
- Of the 3,851 conclusions of suicide, 78% were for males and 22% for females.
- Of the 1,882 open conclusions, 70% were for males and 30% for females.
- 58% of the 4,873 conclusions of death from natural causes were for males, the remaining 42% were for females.
**Figure 6: Conclusions recorded at inquests by sex, England and Wales, 2014**
*Killed unlawfully, Killed lawfully, Attempted or self-induced abortion, Cause of death aggravated by lack of care, or self-neglect, Want of attention at birth, Stillborn, Disasters* Figure 7: Conclusions recorded at inquests by sex, England and Wales, 2014
**Males**
- Suicide: 16%
- Accident/Misadventure: 24%
- Natural Causes: 15%
- Industrial Disease: 13%
- Unclassified: 16%
- Open: 7%
- All Other Conclusions\*: 1%
**Females**
- Suicide: 8%
- Accident/Misadventure: 34%
- Natural Causes: 21%
- Unclassified: 22%
- Open: 6%
- All Other Conclusions\*: 1%
*All Other Conclusions* includes all other causes not listed above. Age of deceased in inquests where a conclusion was recorded
Since 2008, coroners have been asked to provide information (in summary form) on the ages of persons in inquest cases where a conclusion was recorded. Of the inquests completed in 2014, half related to persons who were aged 65 years or over at time of death compared with 7% which related to persons aged under 25 (see Table 8). Although an age breakdown of registered deaths in England and Wales in 2014 is not yet available, ONS figures for 2013 show that 84% of registered deaths in England and Wales were persons aged 65 or over, with only 1% aged under 25 years old.
Figure 8: Age of deceased in inquests where a conclusion was recorded, England and Wales, 2014
Inquests with juries and adjourned inquests
The number of inquests held with juries in 2014 was 397 (representing 1% of all inquests), and a decrease of 59 compared to 2013. Both the number and proportion of inquests held with juries showed a downward trend until recent years but the trend appears now to have stabilised, with the proportion remaining between 1% and 2% for the last eleven years (see Table 10).
In 2014, 698 inquests (representing 2% of all inquests concluded) were adjourned (and not resumed) by the coroner under Schedule 1 of the Coroners and Justice Act 2009 states that the coroner should adjourn an inquest in the event that criminal proceedings may or will take place. Coroners and Justice Act 2009 because criminal proceedings took place. This is the same proportion as 2013 and slightly less than in recent years - around 3% since 2006.
**Time taken to process an inquest**
The estimated(^{24}) average time taken to process an inquest in 2014 (defined as being from the date the death was reported until the conclusion of the inquest) was 28 weeks (see Table 10). Only deaths occurring within England and Wales are included in this estimation.
The maximum average time taken to process an inquest in 2014 was 53 weeks, and the minimum average time was 3 weeks. The large range of average time (50 weeks – based on 3 and 53 weeks) could be due to the fact that coroners’ caseloads can vary greatly and a direct comparison is therefore not advised.
More information about how the average time has been estimated can be found in the Guide to Civil and Administrative Justice Statistics.
______________________________________________________________________
(^{24}) A direct average of the time taken to process an inquest cannot be calculated from the summary data collected; an estimate has been made instead. Please see Guide for more information. Map 5: Average time taken to process inquests, England and Wales, 2014
The average time taken to process an inquest varies from 3 weeks in Hartlepool to 53 weeks in Inner South London.
25 Map does not include Isles of Scilly due to small numbers Treasure and Treasure Trove
On 24 September 1997, the Treasure Act 1996 came into force and replaced the common law of Treasure Trove in England and Wales. The 1996 Act introduced new requirements for reporting and dealing with finds. Not all finds need be the subject of an inquest. For more information please see:
www.legislation.gov.uk/ukpga/1996/24/contents
In 2014, 778 finds were reported and 347 inquests were concluded. In addition, there were 14 inquests held into Treasure Trove in 2014 (relating to finds made before the current Act came into force), and it is likely that a few such inquests will continue to be held from time to time.
The number of finds reported has been generally increasing over the last ten years; however, in 2014 there was a slight decrease of 1% compared to 2013.
Of those 347 inquests concluded in 2014, 317 (91%) returned a verdict of treasure, a slight drop from 93% in 2013.
An annual report on the operation of the Treasure Act 1996 is published by the Department for Culture, Media and Sport. For more information please see:
www.gov.uk/government/organisations/department-for-culture-media-sport/series/treasure-and-portable-antiquities-statistics
Figure 9: Finds reported to coroners, treasure inquests held under the Treasure Act, and proportion of treasure verdicts returned, 2004-2014
This chart does not include reported findings under “Treasure Trove” Map 6: Number of treasure finds reported to coroners, England and Wales, 2014
The highest number of treasure finds reported to coroner areas were in Norfolk and Essex, each with 87. Thirty four coroners' areas had no treasure finds reported to them.
27 Map does not include Isles of Scilly due to small numbers Annex A: Map of coroner areas in England and Wales, 2013
Key to coroner areas
North East 101 – County Durham and Darlington 103 – Hartlepool 104 – North Northumberland 105 – South Northumberland 106 – Teesside
107 – Gateshead and South Tyneside 108 – Newcastle upon Tyne 109 – North Tyneside 110 – Sunderland | Region | Districts | |-------------------------------|---------------------------------------------------------------------------| | **North West** | | | 201 – Cheshire | | | 203 – South and East Cumbria | | | 204 – North and West Cumbria | | | 205 – Manchester (city) | | | 206 – Manchester North | | | 207 – Manchester South | | | 208 – Manchester West | | | 209 – Blackburn, Hyndburn and Ribble Valley | | | 210 – Blackpool and Fylde | | | 211 – East Lancashire | | | 212 – Preston and West Lancashire | | | 213 – Sefton, Knowsley and St Helens | | | 214 – Liverpool | | | 215 – Wirral | | | **Yorkshire and the Humber** | | | 301 – East Riding and Hull | | | 302 – North Lincolnshire and Grimsby | | | 303 – York City | | | 304 – North Yorkshire - East | | | 305 – North Yorkshire - West | | | 306 – South Yorkshire - East | | | 307 – South Yorkshire - West | | | 308 – West Yorkshire - East | | | 309 – West Yorkshire - West | | | **East Midlands** | | | 401 – Derby and Derbyshire | | | 403 – Leicester and South Leicestershire | | | 404 – North Leicestershire and Rutland | | | 406 – Central Lincolnshire | | | 408 – South Lincolnshire | | | 409 – Northamptonshire | | | 410 – Nottinghamshire | | | **West Midlands** | | | 501 – Herefordshire | | | 502 – Shropshire, Telford and Wrekin | | | 504 – Staffordshire South | | | 505 – Stoke-on-Trent and North Staffordshire | | | 507 – Warwickshire | | | 508 – Birmingham and Solihull | | | 509 – Black Country | | | 510 – Coventry | | | 512 – Worcestershire | | | **East of England** | | | 601 – Bedfordshire and Luton | | | 602 – North and East Cambridgeshire | | | 603 – South and West Cambridgeshire | | | 604 – Essex | | | 605 – Hertfordshire | | | 607 – Norfolk | | | 609 – Peterborough | | | 611 – Suffolk | | | **London** | | | 701 – City of London [not visible] | | | 702 – East London | | | 703 – Inner London North | | | 704 – Inner London South | | | 705 – Inner London West | | | 706 – North London | | | 707 – South London | | | 708 – West London | | | **South East** | | | 801 – Berkshire | | | 802 – Brighton and Hove | | | 803 – Buckinghamshire | | | 804 – East Sussex | | | 805 – Central Hampshire | | | 806 – North East Hampshire | | | 807 – Portsmouth and South East Hampshire | | | 808 – Southampton and New Forest | | | 809 – Isle of Wight | | | 810 – Central and South East Kent | | | 811 – Mid Kent and Medway | | | 812 – North East Kent | | | 813 – North West Kent | | | 814 – Milton Keynes | | | 815 – Oxfordshire | | | 816 – Surrey | | | 817 – West Sussex | | | **South West** | | | 901 – Avon | | | 902 – Cornwall | | | 903 – Exeter and Greater Devon | | | 904 – Plymouth, Torbay and South Devon | | | 906 – Dorset | | | 908 – Gloucestershire | | | 909 – Isles of Scilly | | | 910 – Eastern Somerset | | | 911 – Western Somerset | | | 912 – Wiltshire and Swindon | | | **Wales** | | | 1001 – Powys, Bridgend & Glamorgan Valleys | | | 1002 – Cardiff and Vale of Glamorgan | | | 1003 – Carmarthenshire and Pembrokeshire | | | 1004 – North Wales (East and Central) | | | 1005 – Ceredigion | | | 1006 – Gwent | | | 1007 – Swansea and Neath Port Talbot | | | 1009 – North West Wales | | Annex B: Further analysis on number and proportion of deaths reported to coroners
The number of deaths reported to coroners in 2014 varied by coroner area – from 5 in the Isles of Scilly to 6,432 in Essex. There were also over 6,000 deaths reported in the Nottinghamshire coroner area (6,378). The number of deaths reported in each area will be affected by the size, population and demographic breakdown of its area so comparisons of deaths reported to the coroner across coroner areas should be treated with caution.
Figure C1: Number of deaths reported to coroners, 2014
However, when looking at the number of deaths reported to coroners in 2014 as a proportion of registered deaths, which should allow for differences in population characteristics, there is still a wide variation across coroner areas e.g. 24% in North and East Cambridgeshire compared with 96% in Blackburn, Hyndburn and Ribble Valley. Figure C2: Deaths reported to coroners in 2014 as a proportion of registered deaths\\textsuperscript{28,29}
\\textsuperscript{28} Provisional figure based on ONS monthly death registration figures for 2014
\\textsuperscript{29} Data for the City of London has been excluded from this analysis due to the small size of this coroner area. The total number of coroner areas shown in Figure C2 is therefore 98. Explanatory notes
The United Kingdom Statistics Authority has designated these statistics as National Statistics, in accordance with the Statistics and Registration Service Act 2007 and signifying compliance with the Code of Practice for Official Statistics.
Designation can be broadly interpreted to mean that the statistics:
- meet identified user needs;
- are well explained and readily accessible;
- are produced according to sound methods, and
- are managed impartially and objectively in the public interest.
Once statistics have been designated as National Statistics it is a statutory requirement that the Code of Practice shall continue to be observed.
The data analysed in this publication are based on annual returns from coroners. Thanks are due to coroners and their staff for their work in preparing these returns.
Quality and consistency of the statistics
The figures presented in this report are collected via statistical returns completed by coroners. For the calendar year 2014, returns were received nearly all coroner areas electronically (2 were received via post). The process by which coroners provide their returns can vary according to the case management system they use. Many coroners (97%) use a system provided by an external contractor, while other coroners use alternative computer systems or a paper-based system. Although care is taken in completing, analysing and quality-assuring the data provided on the statistical returns, the figures are, of necessity, subject to possible inaccuracies inherent in any large-scale collection of this type. Every effort is made, however, to ensure that the figures presented in this publication are accurate and complete.
Returns are individually quality-assured and validated in a process that highlights inconsistencies between years, and between areas. Checks are made to ensure that each return is arithmetically correct, e.g. subtotals and overall totals are correctly summed. Unusual or outlying values found within returns are queried with the data supplier, to confirm whether these are correct, or that an error exists in the information provided which requires amendment.
Coroners are independent office-holders, and there is considerable variation in the way each coroner’s area is structured and managed, and in the mechanisms they have in place for discharging their duties under the Coroners Act. From a statistical perspective one of these differences relates to the way they approach the handling of “NFA” cases. Many deaths referred to coroners require no further action being taken by them – these are known as “NFA” cases. These are deaths reported to coroners where there was no inquest, no post-mortem, and no certificate was issued by the coroner for registration or any other purpose. The statistics for 1995 onwards include all NFA cases within the figures for deaths reported that required neither an inquest nor a post-mortem. Prior to 1995, however, some coroners did not report some or all of their NFA cases in their annual statistics (figures for some earlier years are shown in Table 2), and the inclusion of all NFA cases in the statistics addressed this inconsistency in reporting.
Despite the inclusion of all NFA cases in the statistics since 1995, there may still however be some differences between coroners as to which cases they consider constitute a substantive “reported death” (and are therefore reported in their statistics) where little or no action is required on their part and no post-mortem or inquest is held. As such, the statistics reflect those cases which each individual coroner considers to be a death reported to them, and the figures for different coroner areas can be compared on this basis.
**Users of the statistics**
The main users of these statistics are coroners themselves, and Ministers and officials in central government responsible for developing policy with regard to coroners. Other users include the Chief Coroner’s Office, local authorities (who are responsible for the appointment and remuneration of coroners), other central government departments, and those non-governmental bodies, including various voluntary organisations, with an interest in coroners and inquests. The statistics are used to monitor the volume and types of cases dealt with by coroners in England and Wales each year.
**Revisions to statistics for previous years**
The estimated figure for the number of registered deaths in 2013 which was derived for the purposes of Table 2 in last year’s edition of this bulletin has now been replaced by an actual figure subsequently published by the Office for National Statistics.
**Symbols and conventions**
The following symbols have been used throughout the tables in this bulletin:
- **n/a** = Not applicable
- **-** = Zero
- **..** = No data available
- \*\*\*\*\* = Number or percentage not shown due to being based on small numbers of cases
- **(r)** = Revised data Maps The maps used in this publication are experimental and any feedback would be welcomed.
Further notes Prior to 1 June 2005, policy responsibility for coroners lay with the Home Office, but on that date it passed to the Department for Constitutional Affairs as part of machinery of government changes following the 2005 general election. Responsibility now lies with the Ministry of Justice, which was created on 9 May 2007.
Prior to the transfer of responsibility, the Home Office published statistical bulletins based on coroners’ annual returns, from 1980. The last four bulletins published in the Home Office Statistical Bulletin series were as follows: for year 2003, bulletin 9/04; for 2002, bulletin 6/03; for 2001, bulletin 3/02; and for year 2000, bulletin 7/01. These may be found at:
webarchive.nationalarchives.gov.uk/20110218135832/http://rds.homeoffice.gov.uk/rds/hosbarchive.html
Editions of this bulletin for years up to and including 2009, published by the Ministry of Justice, the Department for Constitutional Affairs, and the Home Office, were entitled “Statistics on deaths reported to coroners, England and Wales, (year)". Contacts
Current and previous editions of this publication are available for download at:
www.gov.uk/government/collections/coroners-and-burials-statistics
The spreadsheet file of the statistical tables referred to in this bulletin is also available for download from this address, along with the CSV file and the Coroners Statistical Tool spreadsheet.
Press enquiries should be directed to the Ministry of Justice press office:
Tel: 020 3334 3535 Email: [email protected]
Other enquiries about these statistics should be directed to:
Bridgette Miles Ministry of Justice 7th Floor (7.07) 102 Petty France London SW1H 9AJ Email: [email protected]
A copy of the data collection form which was sent to coroners may be obtained via the contact details above.
General enquiries about the statistical work of the Ministry of Justice can be e-mailed to: [email protected]
Other National Statistics publications, and general information about the official statistics system of the UK, are available from www.statistics.gov.uk.
© Crown copyright Produced by the Ministry of Justice
Alternative formats are available on request from [email protected]
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ebd292169733e527b14503976c9eb3e36431a042 | Contents
Contents 2 Introduction 3 Key Findings 11 1: Deaths reported 13 2: Post-mortem examinations held and inquests opened 15 3: Inquests Completed 20 4: Treasure and Treasure Trove 28 Annex A: Map of coroner areas in England and Wales, 2015 30 Annex B: Details of recent coroner area amalgamations 32 Annex C: Further analysis of deaths reported to coroners 33 Explanatory notes 35 Contacts 38 Introduction
This annual bulletin presents statistics of deaths reported to coroners in England and Wales in 2015. Information is provided on the number of deaths reported to coroners, post-mortem examinations and inquests held, and conclusions recorded at inquests. The data are collected via statistical returns completed by coroners. For previous editions of this report, please see:
www.gov.uk/government/collections/coroners-and-burials-statistics
This publication should be read alongside the statistical tables which accompany it, also found via the link above. There is also a supporting comma-separated values (CSV) file to allow users to carry out their own analysis.
In addition to the bulletin and tables, we have published a coroners’ statistical tool (also available at the link above). The tool provides easier access to local level data and allows the user to compare up to four areas of interest, for example, it is possible to compare a coroner area with a geographical region, England or Wales.
The Explanatory Notes section at the end of this bulletin provides information about statistical revisions, and the symbols and conventions used.
If you have any feedback, questions or requests for further information about the bulletin, please direct them to the appropriate contact given at the end of this report.
The legislation
Coroner services in England and Wales are governed by Part 1 of the Coroners and Justice Act 2009 (the 2009 Act), as well as the rules and regulations made under it. The 2009 Act came into force in July 2013, largely replacing the Coroners Act 1988(^1) (the 1988 Act).
The 2009 Act and its rules and regulations can be accessed via the links below:
www.legislation.gov.uk/ukpga/2009/25/contents
www.legislation.gov.uk/2013?title=coroners
(^1) The Coroners Act 1988 was repealed in July 2013 with the exceptions of section 13 (application for a fresh coroner investigation or inquest) and 4A(8) (a coroner in Wales being regarded as a coroner for the whole of Wales). Chief Coroner
The 2009 Act created the post of Chief Coroner to provide judicial oversight of the coroner system and leadership, guidance and support to coroners. The Chief Coroner’s main statutory responsibilities are to:
- approve all coroner appointments made by local authorities (along with the Lord Chancellor);
- keep a register of coroner investigations lasting more than 12 months;
- collate, monitor and publish coroners’ reports to authorities to prevent future deaths; and
- give the Lord Chancellor an annual report, which is published and laid before Parliament (see ‘Chief Coroner’s annual report’ section below).
On 8 April 2015, it was announced that the Lord Chief Justice, after consultation with the Lord Chancellor, had extended the term of office of His Honour Judge Peter Thornton QC as Chief Coroner of England and Wales to 1 October 2016.
Further information on the Chief Coroner is available at:
www.judiciary.gov.uk/about-the-judiciary/office-chief-coroner
Coroner areas and structure
Under the 2009 Act, each coroner area has one senior coroner, and one or more assistant coroners. A coroner area may also have an area coroner (who may function as a deputy to the senior coroner).
For information on changes to coroner areas, please see Annex A.
Investigations
Under the 2009 Act, a coroner conducts an ‘investigation’ into a death (which may or may not include an inquest). Much of the coroner’s investigation takes place before any formal inquest hearing, and includes the coroner considering whether the duty to hold an inquest applies to an individual case.
A coroner has a duty to investigate a death if:
1. the coroner is made aware that the body is within that coroner’s area, and
2. the coroner has reason to suspect that: a) the deceased died a violent or unnatural death; b) the cause of the death is unknown; or c) the deceased died while in custody or state detention².
² Includes deaths that occurred while the individual was subject to a Deprivation of Liberty Safeguard (DoLS) authorisation. See section on ‘changes in reporting’ for more information. The coroner must then establish who has died and how, when, and where they died.
A coroner’s inquest is held for all deaths in custody or state detention. An inquest with a jury is held where the deceased died while in custody or state detention and the death was violent or unnatural, or of unknown cause; where the death resulted from an act or omission of a police officer or member of a service police force in the purported execution of their duties; or where the death was caused by an accident, poisoning or disease which must be reported to a government department or inspector. Jury inquests are not required where the deceased died in custody but from natural causes.
Once the post-mortem examination (including any histology or toxicology) has concluded, the coroner must decide how to proceed. There are three main options:
- The post-mortem examination reveals that the deceased died of natural causes and the coroner considers that it is not necessary to (investigate or) continue the investigation. There will be no inquest.
- The post-mortem examination reveals that the deceased died of natural causes but the coroner considers that it is necessary to (investigate or) continue the investigation. The coroner must then hold an inquest.
- After the post-mortem examination, the coroner (still) has reason to suspect that the deceased died a violent or unnatural death, or the cause of death is unknown, or the deceased died while in custody/state detention. The coroner must then hold an inquest.
**Inquest conclusions**
At the end of an inquest, the coroner (or jury if applicable) completes a form entitled ‘Record of an inquest’. This form documents the ‘conclusion’ of the coroner or jury as to who died and how, when, and where they died.³
A conclusion consists of the legal ‘determination’, which states who died, and where, when and how they died; and ‘findings’ which allow the cause of death to be registered. The coroner or jury may use one of the following short form conclusions⁴:
- accident or misadventure
- alcohol/drug related
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³ The 1988 Act term ‘verdict’ was replaced by the 2009 Act term ‘conclusion’.
⁴ ‘Alcohol/drug related’ and ‘road traffic collision’ are new short form inquest conclusions under the 2009 Act, which came into effect from July 2013. • industrial disease • lawful killing • unlawful killing • natural causes • open • road traffic collision • stillbirth • suicide
Suspension of investigation / adjournment of inquest
Under Schedule 1 to the 2009 Act a coroner must suspend an investigation (and if an inquest has been opened, adjourn that inquest) in the following circumstances:
• If asked to do so by a prosecuting authority because someone may be charged with a homicide or related offence involving the death of the deceased (paragraph 1 of Schedule 1);
• When criminal proceedings have been brought in connection with the death (paragraph 2 of Schedule 1);
• Where there is an inquiry under the Inquiries Act 2005 (paragraph 3 of Schedule 1);
• If it appears to the coroner that it would be appropriate to suspend an investigation or adjourn an inquest (paragraph 5 of Schedule 1).
Chief Coroner’s annual report
The Chief Coroner’s annual report to the Lord Chancellor is a statement on the coroner system for the previous calendar year. It must contain an assessment of consistency of standards between coroner areas; information about investigations that have taken over 12 months to complete; and a summary of reports to prevent future deaths and the responses to these. The annual report is published on the Chief Coroner’s section of the judiciary website.
Coroners are therefore now required to notify the Chief Coroner of any investigation that lasts more than a year and to notify the Chief Coroner of the date on which any such investigation was subsequently concluded.
5 www.judiciary.gov.uk/related-offices-and-bodies/office-chief-coroner/chief-coroners-annual-report-2014-15/ Further information
For further background information on coroners and a flow-chart detailing the possible outcomes involved when a death is reported to a coroner, please refer to ‘A Guide to Civil and Administrative Justice Statistics’, which is available at:
www.gov.uk/government/statistics/guide-to-civil-and-administrative-justice-statistics
A Glossary providing brief definitions for some of the terms used in this bulletin can also be found at the link above.
Related statistics
All deaths in England and Wales must be registered with the Registrar of Births and Deaths. For those deaths where a coroner conducts an inquest, the death will be registered at the conclusion of the inquest, and the cause of death classified according to the conclusion recorded by the coroner. Statistics on registered deaths in England and Wales are published by the Office for National Statistics (ONS) in their series on mortality statistics. These can be accessed from the ONS website at:
www.ons.gov.uk/ons/taxonomy/index.html?nscl=Mortality+Rates
The Ministry of Justice’s coroner statistics differ from ONS figures because they count two different, albeit related, events. The Ministry of Justice’s coroner statistics provide the number of deaths which are reported to coroners in England and Wales. These include deaths reported to coroners which occurred outside England and Wales. The ONS mortality statistics, based on death registrations, report the number of deaths registered (irrespective of whether a coroner has investigated) in England and Wales in a particular year, and therefore do not include deaths that occurred outside England and Wales.
The proportion of deaths which are reported to coroners has been estimated using death registration figures published by ONS. Estimates for 2015 have been calculated using ONS’ monthly provisional figures on death registrations, while percentages for 2014 and earlier years have been calculated using final annual death registration figures for the relevant year.
This publication includes figures for deaths which occurred in state custody. Statistics on deaths in prison custody are also published by the National Offender Management Service (NOMS), accessible via the following link:
www.gov.uk/government/collections/safety-in-custody-statistics
6 Statistics on the number of registered deaths in England and Wales are published by the Office for National Statistics. A final figure for the total number of registered deaths in 2015 has not yet been published, so a provisional figure from ONS, derived from the monthly figures for death registrations in England and Wales, has been used. The figures for deaths in custody in this publication relate only to those deaths which have been reported to a coroner and then reported to MoJ, whereas the NOMS publication includes all deaths which have occurred in prison custody and those which occurred whilst the offender was released on temporary licence for medical reasons.
Changes in reporting
This publication introduces for the first time figures on deaths that occurred while an individual was subject to a Deprivation of Liberty Safeguard (DoLS). DoLS authorisations occur when 'the person is under continuous supervision and control and is not free to leave, and the person lacks capacity to consent to these arrangements'. Such arrangements constitute a form of state detention. The coroner data return for 2015 was modified to collect data on the number of deaths that occurred while the deceased was subject to a DoLS, as a category within the state detention section of the data return.
Prior to 2015, data related to deaths of individuals subject to DoLS authorisations, e.g. deaths reported, post-mortem examinations and inquests held as well as conclusions record at inquests should have been included within the coroners’ returns. New information collected for the first time this year records the specific number of deaths of individuals subject to DoLS authorisations within the state detention section of the data return.
Collection of this information has coincided with a substantial increase in the overall number of DoLS authorisations issued in England and Wales following the Supreme Court judgment in the Cheshire West case and has had a significant impact on a number of key statistics reported within this publication. The Health & Social Care Information Centre (HSCIC) 2014-15 Annual report records that on 31 March 2015, there were 36,215 active DoLS authorisations in place in England compared to 2,300 on 31 March 2014.
In 2015, there were 7,183 deaths of individuals subject to DoLS authorisations reported to coroners. Equivalent data on the specific number of this type of death was not collected in 2014, although they should still be included within all other figures, e.g. deaths reported to the coroner, inquests held etc.
7 The safeguards do not apply when someone is detained ('sectioned') under the Mental Health Act 1983 8 The Supreme Court’s 2014 judgment in the cases of P v Cheshire West and Chester Council and P&O v Surrey County Council (Cheshire West) clarified the circumstances in which a DoLS is likely to be required and made it clear that many more circumstances amounted to a deprivation of liberty by the state. The Supreme Court decided that deprivation of liberty arose when the person concerned ‘was under continuous supervision control and was not free to leave’ and that the deprivation was the responsibility of the state. It did not matter that the patient in hospital or the resident of a care home was content or compliant or voiced no objection if in fact they did not have capacity to consent to the arrangements. 9 www.hscic.gov.uk/catalogue/PUB18577/dols-eng-1415-rep.pdf Figure 3.2, page 25 However, as the number of DoLS authorisations as of 30 March 2014 was only 2,300, the number of deaths of individuals subject to a DoLS authorisation in 2014 would have been minimal.
Figure A below shows that the inclusion of deaths of individuals subject to DoLS authorisations within the number of deaths in state detention, has distorted the long-term trend. However, the trend in deaths in state detention excluding DoLS is in line with that seen previously and within the Safety in Custody statistics quarterly bulletin (see ‘Related statistics’ section above).
**Figure A: Number of deaths in state detention, by type of detention, 2011-2015**
The large increase in DoLS authorisations and the corollary increase in deaths of individuals whilst subject to DoLS has had an impact on a number of key statistics reported within this publication:
- There were 6,968 more inquests opened in 2015, up 27% on the previous year, reversing the downward trend seen in the previous three years, driven by the increase in the number of deaths of individuals subject to DoLS authorisations reported, all of which require an inquest.
- Of all inquests that concluded in 2015, the death by natural causes conclusion saw the largest increase, up 6,170 to 11,043 (+127%). This increase can be attributed to the fact that almost all (94%) of DoLS inquests record a conclusion of death by natural causes. Table A: Number of deaths under Deprivation of Liberty Safeguard (DoLS), reported to coroners, by gender and inquest conclusion group, 2015
| | Male | Female | Total | |----------------------|------|--------|-------| | Natural causes | 2,497| 4,263 | 6,760 | | Other causes | 194 | 229 | 423 | | Total | 2,691| 4,492 | 7,183 |
- As a result of the majority of DoLS inquests recording a conclusion of natural causes, the proportion of post-mortems being carried out in inquests has reduced (down 20 percentage points to 56% in 2015) – post-mortems are not required in deaths recorded at inquest as being due to natural causes.
- Reporting on an increased number of deaths of individuals subject to DoLS authorisations has also impacted on the average time taken for a case to be concluded, down 8 weeks (from 28 weeks in 2014 to 20 weeks in 2015). In uncontroversial cases, an inquest may be carried out as a ‘paper’ inquest i.e. decided in open court but on the papers, without witnesses having to attend, and with the relevant medical data being analysed without a post-mortem.
Users of the statistics
The main users of these statistics are coroners and Ministers and officials in central government to assist in developing coroners’ policy and its subsequent monitoring. Other users include the Chief Coroner, local authorities (who are responsible for appointing and paying coroners as well as funding their services), other central government departments, and those non-governmental bodies, including various voluntary organisations, with an interest in coroners and inquests. The statistics are used to monitor the volume and types of cases dealt with by coroners in England and Wales each year.
Date of next publication
The next edition of Coroners Statistics Annual 2016 is scheduled to be published in May 2017, covering statistics for calendar year 2016. Key Findings
- 236,406 deaths were reported to coroners in 2015, an increase of 12,565 (6%) from 2014, reflecting the rise in the number of registered deaths(^{10}) from 2014 to 2015 (up 6%) and the increase in the number of deaths under Deprivation of Liberty Safeguard (DoLS) authorisations reported to coroners.
- Just under half (45%) of all registered deaths(^{6}) were reported to coroners in 2015, the same level seen in 2014 and 2013. Over the last ten years, this proportion has been generally consistent, within the range of 45% to 47%.
- In 2015, newly collected figures on deaths of individuals subject to DoLS authorisations show that there were 7,183 such deaths.
- The number of inquests opened in 2015 increased by 6,968 (up 27%) to 32,857, driven by the increase in DoLS authorisations and the corollary increase in deaths while subject to DoLS. All such cases require an inquest.
- There were 89,206 post-mortem examinations ordered by coroners in 2015, 38% of all cases reported to them. This is down two percentage points since 2014, consistent with the long-term downward trend.
- For those inquests concluded in 2015, there were 35,473 total inquest conclusions recorded, up 22% on 2014, reflecting in part the rise in the number of inquests opened. Inquest conclusions of natural causes were up 127% on 2014 to 11,043, driven by the majority (94%) of DoLS cases having an inquest conclusion of natural causes. The number of inquests resulting in a conclusion of natural causes, excluding those for 6,760 deaths of individuals subject to DoLS authorisations, was stable with the previous year.
- In 2015, post-mortem examinations were conducted in 56% of inquest cases, down 20 percentage points on 2014, driven by the increase in deaths of individuals subject to DoLS authorisation – all such cases require an inquest, with the majority recording an inquest conclusion of natural causes; a post-mortem examination is therefore unlikely to be required to determine the cause of death and the inquest may well be a ‘paper’ inquest.
- Just three of the ten possible inquest short form conclusions account for almost 67% of all conclusions recorded. These are natural causes (31%) accident and misadventure (22%) and unclassified inquest conclusions (14%).
- The estimated average time taken to process an inquest in 2015 was 20 weeks, with a minimum of 5 weeks and a maximum of 61 weeks across
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(^{10}) A provisional figure for the number of registered deaths in 2015 in England and Wales has been used, derived from monthly figures produced by the Office for National Statistics. coroner areas. This is an improvement of 8 weeks, when compared to 2014. This can largely be attributed to DoLS where, in accordance with the Chief Coroner’s guidance,\\textsuperscript{11} in uncontroversial cases the inquest can be a ‘paper inquest’ i.e. decided in open court but on papers without the need for witnesses or a post mortem.
\\textsuperscript{11} www.rcgp.org.uk/~media/Files/RCGP-Faculties-and-Devolved-Nations/SW-England-Wales/Tamar/Chief%20Coroner%20Guidance%20on%20DOLS.ashx 1: Deaths reported
The number of deaths reported to coroners in 2015 rose by 12,565 (6%) from the previous year - from 223,841 in 2014 to 236,406 in 2015 which reflects the increase in the number of deaths registered in England and Wales (up 6%). The proportion of registered deaths in 2015 that were reported to coroners was 45%, no change from 2013 and 2014.
Figure 1: Registered deaths and deaths reported to coroners, England and Wales, 2004-2015
Over the last decade, the number of registered deaths in England and Wales has decreased from 512,993 in 2005 to 501,424 in 2014 rising to 529,613(^{12}) in 2015. The number of deaths reported to coroners has also fluctuated over the last ten years with 232,401 deaths reported in 2005, rising to a high of 234,784 in 2008. The number of deaths reported to coroners fell to its lowest since 2001 to 223,841 in 2014, rising by 12,565 deaths in 2015.
Map 1 below shows deaths reported in each coroner area in 2015 as a percentage of the total deaths in each area(^{13}).
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(^{12}) Provisional figure based on ONS monthly death registration figures for 2015
(^{13}) The reported deaths figure for 2015 is provisional, based on ONS monthly death registration figures Map 1: Deaths reported to coroners as a percentage of total registered deaths in each area\\textsuperscript{14}, England and Wales, 2015
The proportion of deaths reported to the coroner varies from 26% in Rutland and North Leicestershire to 92% in Stoke-on-Trent and North Staffordshire.
\\textsuperscript{14} The ONS death registration figures are based on area of usual residence whereas the coroners’ figures are based on the area where a person died. Therefore the coroner office for the City of London shows a distorted figure of 476% due to the low levels of residence and high level of commuters. 2: Post-mortem examinations held and inquests opened
Post-mortem examinations were held for 89,206 deaths reported to coroners in 2015, down 669 (1%) from 2014.
Post-mortem examinations were ordered by coroners in 38% of all deaths reported to them in 2015, down by two percentage points on 2014, and consistent with the existing long-term downward trend. Since 1995, the proportion of post-mortem examinations ordered has decreased by 23 percentage points, from 61% to 38% (see Table 3).
There were 32,857 inquests opened in 2015, an increase of 27% on 2014, driven by the increase in deaths of individuals subject to DoLS authorisations, as all such cases require an inquest\\textsuperscript{15}.
Inquest cases represented 14% of all the deaths reported to coroners in 2015, an increase of two percentage points on 2014.
Figure 2: Post-mortems and inquests as a percentage of deaths reported to coroners, England and Wales, 2004-2015
\\textsuperscript{15} More information on DoLS can be found in the changes to reporting section of the Introduction to the publication Map 2: Post-mortems held as a proportion of deaths reported to coroners, England and Wales, 2015
The proportion of post-mortems carried out varies from 20% in the City of London to 62% in Isle of Wight. The proportion of inquests carried out varies from 5% in Gwent to 36% in Hartlepool (when excluding Isles of Scilly, due to small numbers).
**Post-mortem examinations in inquest cases**
When an inquest is opened, a post-mortem examination will usually be conducted. In 2015, over a half (56%) of inquest cases involved a post-mortem, down 20 percentage points on 2014 continuing the declining trend seen over the past decade (from 93% in 2006). Historically, it was quite rare for an inquest to be opened without a post-mortem; however, since 1997 this proportion had been gradually increasing, with sharp increases seen in the last two years. In 2015, 44% of all inquests had no post-mortem, compared with 24% in 2014 and 16% in 2013. This may be attributed to the provisions in the Coroners Act 2009 which came into effect in July 2013, allowing a coroner to conduct a brief investigation prior to making a decision on whether to hold a formal inquest. These are captured in the potential inquest cases below.
**Post-mortems in non-inquest cases**
In the majority (84%) of cases referred to coroners, there is no inquest. In 2015, there were 66,549 non-inquest cases where a post-mortem was held. The percentage of non-inquest cases that required a post-mortem has remained at 34% for the past four years although this proportion had fallen steadily prior to this; at the beginning of the time series, in 1995, it was 56%.
**Post-mortems in potential inquest cases**
Prior to July 2013, cases were either categorised as ‘inquest’ or ‘non-inquest’ cases. Changes in the way coroners are able to conduct an investigation mean that there is now a third category of ‘potential inquest’ cases. This means that the coroner is investigating the death, but has not yet decided whether it is necessary to hold an inquest. Depending on whether or not the coroner deems it necessary to hold an inquest, these cases will all eventually end up in either the ‘inquest’ or ‘non-inquest’ category.
In 2015, there were 4,971 potential inquest cases being dealt with by coroners in England and Wales, with almost all (87%) requiring a post-mortem.
**Cases requiring neither an inquest nor a post-mortem**
There were 132,029 cases reported to coroners where there was neither an inquest nor a post-mortem. This type of case has generally been increasing in number in recent years (in 2005 there were 116,047 such cases), with this year increasing by 4,383 cases (3%). The proportion of cases where there was neither an inquest nor a post-mortem examination has remained stable over the last four years, at 66%. Prior to this time the proportion had been increasing, since the time series began in 1995, when it stood at 44%.
**Post-mortem rates, histology(^{16}) and toxicology(^{17})**
Post-mortem examinations can be classed as either standard or non-standard, depending on the cost of the examination. A non-standard post-mortem is charged at a higher rate than a standard post-mortem and is defined as a post-mortem which requires special skills. A non-standard post-mortem could, for example, require a paediatric or specialist pathologist. In 2015, almost all (95%) of post-mortems were ordered at a standard rate - this has remained at the same level since 2011.
In 2015, 18,659 post-mortems included histology; and despite an increase in the overall number by 226 from last year, the proportion of post-mortems which included histology which has remained at 21% of all post mortems. In
(^{16}) Histology in the context of post-mortems is the examination of tissues under a microscope.
(^{17}) Toxicology in the context of post-mortems is the study of body fluids and tissues for the detection of drugs. 2015, 14,732 post-mortems held included toxicology (17% of post-mortems held), which was 1,028 more than in 2014, an increase of 8%. This follows the steady rising trend seen since 2011.
**Out of England and Wales Orders**
To remove a body of a deceased person out of England and Wales, notice must be given to the coroner within whose area the body is lying. When the coroner gives permission for the removal of a body, an Out of England and Wales order is issued.
Coroners issued 5,339 Out of England and Wales orders in 2015, compared with 5,232 issued in 2014. In both years, the number of orders issued represented 2% of the total number of deaths reported to coroners – this proportion has been stable at this level since 2011 (see Table 5).
**Deaths abroad**
Of the 236,406 deaths reported to coroners in 2015, around 1% (1,874) were reports of deaths that had occurred outside England and Wales. This has remained at the same level since 2011.
**Deaths in State Detention**
In 2015, a total of 7,667 deaths which occurred in state detention were reported to coroners(^\\text{18}), an increase of 7,315 deaths on the previous year and representing 3% of all deaths reported to coroners.
Prior to 2015, deaths of individuals subject to Deprivation of Liberty Safeguard (DoLS) authorisations were not collected separately within the ‘Deaths in state detention’ section of the coroners’ return although all such deaths would have been reported to coroners and included in published statistics although the number would have been minimal.
In 2015, newly collected figures show that there were 7,183 deaths of individuals subject to DoLS(^\\text{19}) authorisations – the large increase since 2014 is in line with that seen in the number of active DoLS authorisations; as of 31 March 2015, there were over 36,000 compared with 2,300 as of March 2014. Deaths of individuals subject to DoLS authorisations accounted for 94% of all deaths in state in detention in 2015.
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(^{18}) This data only represents deaths in custody which were referred to a coroner and subsequently reported to MoJ in the coroner’s annual return.
(^{19}) See introduction, section changes to reporting for more information on DoLS. 3: Inquests Completed
There were 35,473 inquests conclusions recorded in 2015, up by 6,320 (22%) from 2014, in part reflecting the increase in the number of inquests opened. This is the highest number of inquest conclusions recorded since the series began in 1995.
Historically, the most common inquest conclusions (in order of frequency observed) were death from natural causes, death by accident or misadventure and unclassified conclusions. In 2015 the most common conclusions (by order of frequency) continue to be death from natural causes (11,043 or 31%), death by accident and misadventure (7,977 or 22%), and unclassified (4,870 or 14%).
Figure 3: Conclusions recorded at inquest, by category and as a proportion of all conclusions, England and Wales, 2014 and 2015
The conclusion category driving the increase seen when compared to 2014 is death by natural causes, which increased by 127% (6,170 more conclusions), driven by the majority (94%) of deaths of individuals subject to DoLS authorisations having an inquest conclusion of natural causes. Historically, natural cause conclusions had been steadily increasing, until last year (2014),
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20 Figures may not equal 100% due to rounding. 21 All other conclusions (including Killed unlawfully, Killed lawfully, Attempted or self-induced abortion, Cause of death aggravated by lack of care, or self-neglect, Want of attention at birth, Stillborn, Disasters) were not included in the chart as they represented less than 0.5% of the short-form conclusions. where they fell by 4,008 or 45% compared to 2013. This was explained to be in part due to the Coroners Act 2009 coming into effect in July 2013, which meant coroners could issue a death certificate without holding an inquest when it is known that a death has occurred naturally. In 2015, the number of inquests recording a natural causes conclusion, excluding DoLS, was stable compared with the previous year.
**Figure 4: Number of conclusions recorded at inquests, England and Wales, 2004-2015**
For the remaining conclusion types, drugs and alcohol related cases increased by 622 cases (up 38%) to 2,267 and road traffic collisions by 177 cases (up 27%) to 779. These two categories were added as short form conclusions in 2014, resulting in the large increase seen in figure 4, for the ‘all other conclusion’ group. The remaining conclusions either saw a slight decrease or remained stable when compared to 2014.
Although overall accident and misadventure inquest conclusions remained stable when compared to 2014, with 7,977 conclusions, the trend differed by gender – females up 5% (172 cases) and males down 3% (136 cases).
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22 For years 2004-2013, this includes the previously used conclusions “Dependence on Drugs” and “Non-dependence on Drugs” In 2015, the number of unclassified conclusions decreased by 391 cases (down 7%) to 4,870, continuing the trend change seen in 2014, where unclassified cases decreased for the first time. Prior to 2014, unclassified cases had been increasing year on year since records began in 1995. The proportion of conclusions that were unclassified had also been increasing year on year, from 1% in 1995 to 18% in 2014, until 2015, where it dropped by 4 percentage points to 14%. This decrease in unclassified conclusions is likely due to the large increase seen in natural causes conclusion category.
The rise in proportion of unclassified conclusions seen until 2014 is partly due to the increasing use of what are known as ‘narrative conclusions’ by some coroners. In these cases, the conclusion is recorded as unclassified. As well as narrative conclusions, this category includes short non-standard conclusions which a coroner or jury might return when the circumstances do not easily fit any of the standard conclusions23.
As a proportion of all conclusions, death by accident or misadventure has been declining steadily, from 35% of conclusions in 2005 to 22% in 2015, with an increase to 27% in 2014. Open conclusions have been decreasing over the same period, particularly over the last few years - they accounted for 5% in 2015 compared with 9% in 2005. The proportion of inquest conclusions recorded as suicide has decreased to 11% in 2015 since peaking in 1995 at 18%.
23 An analysis on unclassified conclusions can be found in the Coroners Statistics 2012 publication (Annex A), available at: www.gov.uk/government/publications/coroners-statistics The proportion of conclusions recorded as suicide varies from 0% in Gateshead and South Tyneside, to 27% in Gwent (when excluding City of London and Isle of Scilly, due to small numbers). A majority of the coroner offices (56) recorded suicide conclusions in 10% to 19% of inquests.
Differences in conclusions recorded by gender
The pattern of conclusions recorded differs between males and females. Male deaths accounted for 60% of all conclusions recorded in 2015, however they accounted for just over half (54%) of deaths reported; this suggests that males are more likely to die in circumstances that lead to an inquest. Female deaths accounted for about 40% of all conclusions recorded in 2015 (and 46% of deaths reported).
- Of the 3,899 conclusions of suicide, 77% were for males and 23% for females.
- Of the 1,736 open conclusions, 71% were for males and 29% for females.
- 56% of the 11,043 conclusions of death from natural causes were for females, the remaining 44% were for males.
**Figure 5: Conclusions recorded at inquests by sex, England and Wales, 2015**
| Conclusion Type | Male | Female | |--------------------------|------|--------| | All other conclusion\* | 57% | 43% | | Unclassified | 57% | 43% | | Open | 71% | 29% | | Natural causes | 44% | 56% | | Industrial disease | 92% | 8% | | Road Traffic Collision | 76% | 24% | | Drugs/Alcohol related | 77% | 23% | | Suicide | 77% | 23% |
\*Killed unlawfully, Killed lawfully, Attempted or self-induced abortion, Cause of death aggravated by lack of care, or self-neglect, Want of attention at birth, Stillborn, Disasters, Accident and misadventure
**Age of deceased in inquests where a conclusion was recorded**
Since 2008, coroners have been asked to provide information (in summary form) on the ages of persons in inquest cases where a conclusion was recorded. Of the inquests completed in 2015, three-fifths related to persons who were aged 65 years or over at time of death compared with 5% which related to persons under 25 year of age (see Table 8). Although an age breakdown of registered deaths in England and Wales in 2015 is not yet available, ONS figures for 2014 show that 84% of registered deaths in England and Wales were persons aged 65 or over, with only 1% aged under 25 years old.
The profile of the age of deceased in inquests has changed compared to 2014, i.e. half of inquests completed in 2014 related to persons aged 65 or over compared with 61% in 2015. This may be due to the increase in the number of deaths of individuals subject to DoLS authorisations, all of which require an inquest and may predominantly relate to the older population.
**Figure 6: Age of deceased in inquests where a conclusion was recorded, England and Wales, 2015**
![Age of deceased in inquests chart]
**Inquests with juries and adjourned inquests**
The number of inquests held with juries in 2015 was 457 (representing 1% of all inquests), an increase of 60 compared to 2015.
Both the number and proportion of inquests held with juries showed a downward trend until recent years but the trend appears now to have stabilised, with the proportion remaining between 1% and 2% for the last eleven years (see Table 9).
In 2015, 728 inquests were adjourned (and not resumed) by the coroner under Schedule 1 of the Coroners and Justice Act 2009 because criminal proceedings took place. This represents 2% of all inquests concluded, the same proportion as 2014 and 2013, and slightly less than in earlier years - around 3% since 2006.
______________________________________________________________________
24 The ‘age not known’ category has been excluded from the chart due to small numbers (less than 0.5%). Totals may not add up to 100% due to rounding.
25 Schedule 1 of the Coroners and Justice Act 2009 states that the coroner should adjourn an inquest in the event that criminal proceedings may or will take place. Time taken to process an inquest
The estimated\\textsuperscript{26} average time taken to process an inquest in 2015 (defined as being from the date the death was reported until the conclusion of the inquest) was 20 weeks (see Table 13)\\textsuperscript{27}, a reduction of 8 weeks compared to 2014. This can largely be attributed to DoLS where, in accordance with the Chief Coroner’s guidance, in uncontroversial cases, an inquest can be a ‘paper inquest’, i.e. decided in open court but on papers without the needs for witnesses or a post-mortem.
The maximum average time taken to process an inquest in 2015 was 61 weeks, and the minimum average time was 6 weeks. The large range of average time (55 weeks – based on 6 and 61 weeks) could be due to the fact that coroners’ caseloads can vary greatly and a direct comparison between coroner areas is therefore not advised.
More information about how the average time taken has been estimated can be found in the explanatory notes section of this report.
\\textsuperscript{26} A direct average of the time taken to process an inquest cannot be calculated from the summary data collected; an estimate has been made instead. Please see the explanatory notes section of this report for more information.
\\textsuperscript{27} Only deaths occurring within England and Wales are included in this estimation. Map 5: Average time taken to process inquests, England and Wales, 2015
The average time taken to process an inquest varies from 6 weeks in Hartlepool to 61 weeks in West London. 4: Treasure and Treasure Trove
On 24 September 1997, the Treasure Act 1996 came into force and replaced the common law of Treasure Trove in England and Wales. The 1996 Act introduced new requirements for reporting and dealing with finds. Not all finds need be the subject of an inquest. For more information please see:
www.legislation.gov.uk/ukpga/1996/24/contents
In 2015, 810 finds were reported and 390 inquests were concluded. In addition, there were seven inquests held into Treasure Trove in 2015 (relating to finds made before the current Act came into force), and it is likely that a few such inquests will continue to be held from time to time.
The number of finds reported has been steadily increasing over the last ten years; in 2015 there was an increase of 4% compared to 2014. Of those 390 inquests concluded in 2015, 96% (373) returned a verdict of treasure, a rise from 91% (317) in 2014.
An annual report on the operation of the Treasure Act 1996 is published by the Department for Culture, Media and Sport. For more information please see:
www.gov.uk/government/organisations/department-for-culture-media-sport/series/treasure-and-portable-antiquities-statistics
Figure 7: Finds reported to coroners, treasure inquests held under the Treasure Act, and proportion of treasure verdicts returned, 2004-2015
28 This chart does not include reported findings under “Treasure Trove” Map 6: Number of treasure finds reported to coroners, England and Wales, 2015
Thirty-one coroner areas had no treasure finds reported to them. Norfolk had the highest number of treasure finds at 97. Annex A: Map of coroner areas in England and Wales, 2015
Key to coroner areas
## Coroners Statistics 2015
### North East
- 101 – County Durham and Darlington
- 103 – Hartlepool
- 104 – North Northumberland
- 105 – South Northumberland
- 106 – Teesside
- 107 – Gateshead and South Tyneside
- 108 – Newcastle upon Tyne
- 109 – North Tyneside
- 110 – Sunderland
### North West
- 201 – Cheshire
- 203 – Cumbria
- 205 – Manchester (city)
- 206 – Manchester North
- 207 – Manchester South
- 208 – Manchester West
- 209 – Blackburn, Hyndburn and Ribble Valley
- 210 – Blackpool and Fylde
- 211 – East Lancashire
- 212 – Preston and West Lancashire
- 213 – Sefton, Knowsley and St Helens
- 214 – Liverpool and the Wirral
### Yorkshire and the Humber
- 301 – East Riding and Hull
- 302 – North Lincolnshire and Grimsby
- 303 – York City
- 304 – North Yorkshire - East
- 305 – North Yorkshire - West
- 306 – South Yorkshire - East
- 307 – South Yorkshire - West
- 308 – West Yorkshire - East
- 309 – West Yorkshire - West
### East Midlands
- 401 – Derby and Derbyshire
- 403 – Leicester and South Leicestershire
- 404 – North Leicestershire and Rutland
- 406 – Central Lincolnshire
- 408 – South Lincolnshire
- 409 – Northamptonshire
- 410 – Nottinghamshire
### West Midlands
- 501 – Herefordshire
- 502 – Shropshire, Telford and Wrekin
- 504 – Staffordshire South
- 505 – Stoke-on-Trent and North Staffordshire
- 507 – Warwickshire
- 508 – Birmingham and Solihull
- 509 – Black Country
- 510 – Coventry
- 512 – Worcestershire
### East of England
- 601 – Bedfordshire and Luton
- 602 – Cambridgeshire and Peterborough
- 604 – Essex
- 605 – Hertfordshire
- 607 – Norfolk
- 611 – Suffolk
### London
- 701 – City of London [not visible]
- 702 – East London
- 703 – Inner London North
- 704 – Inner London South
- 705 – Inner London West
- 706 – North London
- 707 – South London
- 708 – West London
### South East
- 801 – Berkshire
- 802 – Brighton and Hove
- 803 – Buckinghamshire
- 804 – East Sussex
- 805 – Central Hampshire
- 806 – North East Hampshire
- 807 – Portsmouth and South East Hampshire
- 808 – Southampton and New Forest
- 809 – Isle of Wight
- 810 – Central and South East Kent
- 811 – Mid Kent and Medway
- 812 – North East Kent
- 813 – North West Kent
- 814 – Milton Keynes
- 815 – Oxfordshire
- 816 – Surrey
- 817 – West Sussex
### South West
- 901 – Avon
- 902 – Cornwall
- 903 – Exeter and Greater Devon
- 904 – Plymouth, Torbay and South Devon
- 906 – Dorset
- 908 – Gloucestershire
- 909 – Isles of Scilly
- 910 – Eastern Somerset
- 911 – Western Somerset
- 912 – Wiltshire and Swindon
### Wales
- 1001 – Powys, Bridgend & Glamorgan Valleys
- 1002 – Cardiff and Vale of Glamorgan
- 1003 – Carmarthenshire and Pembrokeshire
- 1004 – North Wales (East and Central)
- 1005 – Ceredigion
- 1006 – Gwent
- 1007 – Swansea and Neath Port Talbot
- 1009 – North West Wales Annex B: Details of recent coroner area amalgamations
The following table summarises the coroner area amalgamations that have occurred since the 2014. This bulletin uses the coroner areas shown below that were formed in 2015 to breakdown the figures. Additionally, one of the 2016 amalgamations, has also been included in this report. A 2015 data return was received from Somerset coroner area, even though this area did not officially come into force until 1st April 2016. Therefore it was not possible to report on East Somerset and West Somerset coroner areas individually.
| Date effective | Previous coroner area | New coroner area | Nature of merge | |----------------|-----------------------------------------------------------|-----------------------------------------|-----------------| | 01-Jan-15 | North and West Cumbria; South and East Cumbria | Cumbria | 2 into 1 | | 02-Apr-15 | Liverpool; the Wirral | Liverpool and the Wirral | 2 into 1 | | 01-Aug-15 | North and East Cambridgeshire; South and West Cambridgeshire; Peterborough | Cambridgeshire and Peterborough | 3 into 1 | | 01-Apr-16 | East Somerset; West Somerset | Somerset | 2 into 1 | | 01-Apr-16 | Cornwall; the Isles of Scilly | Cornwall and the Isles of Scilly | 2 into 1 | | 01-Apr-16 | Cardiff and Vale of Glamorgan; Powys, Bridgend & Glamorgan Valleys; | South Wales Central | 2 into 1 | Annex C: Further analysis of deaths reported to coroners
The number of deaths reported to coroners in 2015 varied by coroner area – from 14 in the Isles of Scilly to 6,869 in Essex. The number of deaths reported in each area will be affected by its size, population and demographic breakdown so comparisons of deaths reported to the coroner across coroner areas should be treated with caution.
Figure C1: Number of deaths reported to coroners, 2015
When looking at the number of deaths reported to coroners in 2015 as a proportion of registered deaths(^{29}), which should allow for differences in population characteristics, there is still a wide variation across coroner areas e.g. 26% in Rutland and North Leicestershire compared with 92% in Stoke-on-Trent and North Staffordshire.
(^{29}) As the ONS death registration figures are based on area of usual residence whereas the coroners’ figures are based on the area where a person died, these figures should be used with caution. For example, the coroner office for the City of London shows a distorted figure of 476% due to the low levels of residence and high level of commuters. Figure C2: Deaths reported to coroners in 2014 as a proportion of registered deaths\\textsuperscript{30,31}
\\textsuperscript{30} Provisional figure based on ONS monthly death registration figures for 2015
\\textsuperscript{31} Data for the City of London has been excluded from this analysis due to the small size of this coroner area. The total number of coroner areas shown in Figure C2 is therefore 93. Explanatory notes
The United Kingdom Statistics Authority has designated these statistics as National Statistics, in accordance with the Statistics and Registration Service Act 2007 and signifying compliance with the Code of Practice for Official Statistics.
Designation can be broadly interpreted to mean that the statistics:
- meet identified user needs;
- are well explained and readily accessible;
- are produced according to sound methods, and
- are managed impartially and objectively in the public interest.
Once statistics have been designated as National Statistics it is a statutory requirement that the Code of Practice shall continue to be observed.
The data analysed in this publication are based on annual returns from coroners. Thanks are due to coroners and their staff for their work in preparing these returns.
Quality and consistency of the statistics
The figures presented in this report are collected via statistical returns completed by coroners. For the calendar year 2015, all coroner area returns were received electronically. The process by which coroners provide their returns can vary according to the case management system they use. Many coroners use a system provided by an external contractor, while other coroners use alternative computer systems or a paper-based system. Although care is taken in completing, analysing and quality-assuring the data provided on the statistical returns, the figures are, of necessity, subject to possible inaccuracies inherent in any large-scale collection of this type. Every effort is made, however, to ensure that the figures presented in this publication are accurate and complete.
Returns are individually quality-assured and validated in a process that highlights inconsistencies between years, and between areas. Checks are made to ensure that each return is arithmetically correct, e.g. subtotals and overall totals are correctly summed. Unusual or outlying values found within returns are queried with the data supplier, to confirm whether these are correct, or that an error exists in the information provided which requires amendment.
There were two coroner areas where data discrepancies from the 2015 data returns were unresolvable at the time of publication. East Sussex and Plymouth, Torbay and South Devon coroner areas. Both reported discrepancies when reporting the number of post-mortems by type, whether by standard and non-standard rate and by gender and inquest situation of the case. Following discussions with these coroner areas we took the post- mortem by gender and inquest, to be the correct official figure for these areas.
Coroners are independent office-holders, and there is considerable variation in the way each coroner’s area is structured and managed, and in the mechanisms they have in place for discharging their duties under the Coroners Act. From a statistical perspective one of these differences relates to the way they approach the handling of “NFA” cases.
Many deaths referred to coroners require no further action being taken by them – these are known as “NFA” cases. These are deaths reported to coroners where there was no inquest, no post-mortem, and no certificate was issued by the coroner for registration or any other purpose. The statistics for 1995 onwards include all NFA cases within the figures for deaths reported that required neither an inquest nor a post-mortem. Prior to 1995, however, some coroners did not report some or all of their NFA cases in their annual statistics (figures for some earlier years are shown in Table 2), and the inclusion of all NFA cases in the statistics addressed this inconsistency in reporting.
Despite the inclusion of all NFA cases in the statistics since 1995, there may still however be some differences between coroners as to which cases they consider constitute a substantive “reported death” (and are therefore reported in their statistics) where little or no action is required on their part and no post-mortem or inquest is held. As such, the statistics reflect those cases which each individual coroner considers to be a death reported to them, and the figures for different coroner areas can be compared on this basis.
**Timeliness of inquests**
For the purpose of determining the timeliness of inquests, the time taken to conduct an inquest is deemed to be from the day the death was reported to the coroner until either (a) the day the inquest is concluded by the delivery of a verdict or (b) the day the coroner certifies that an adjourned inquest will not be resumed.
The average time for an inquest to be conducted is estimated in the following way: Coroners are asked in their annual return to state how many inquests were concluded within certain time periods. There are five time bands, which are: within one month; 1-3 months; 3-6 months; 6-12 months; and over 12 months. All the inquests falling within a time-band are then assumed to have been completed at or near the mid-point of the various time-bands for the purposes of calculating the average, although inquests within the “under one month” band are assumed to have taken 3 weeks for this purpose of this estimation, and those inquests taking over a year to conclude were deemed to have taken 18 months, although the time-band itself is open-ended. Numbers are then aggregated and the average figure (in weeks) calculated in the normal way. Only deaths occurring within England and Wales are included in the calculation. Statistics are not collected on the time taken for inquests where the death occurred outside England and Wales. Deaths occurring abroad are often significantly delayed because of the difficulty, for example, of obtaining reports from other countries.
Revisions to statistics for previous years The estimated figure for the number of registered deaths in 2014 which was derived for the purposes of Table 2 in last year’s edition of this bulletin has now been replaced by an actual figure subsequently published by the Office for National Statistics.
Symbols and conventions The following symbols have been used throughout the tables in this bulletin:
n/a = Not applicable
- = Zero .. = No data available (p) = provisional data (r) = Revised data
Further notes Prior to 1 June 2005, policy responsibility for coroners lay with the Home Office, but on that date it passed to the Department for Constitutional Affairs as part of machinery of government changes following the 2005 general election. Responsibility now lies with the Ministry of Justice, which was created on 9 May 2007.
Prior to the transfer of responsibility, the Home Office published statistical bulletins based on coroners’ annual returns, from 1980. The last four bulletins published in the Home Office Statistical Bulletin series were as follows: for year 2003, bulletin 9/04; for 2002, bulletin 6/03; for 2001, bulletin 3/02; and for year 2000, bulletin 7/01. These may be found at:
webarchive.nationalarchives.gov.uk/20110218135832/http://rds.homeoffice.gov.uk/rds/hosbarchive.html
Editions of this bulletin for years up to and including 2009, published by the Ministry of Justice, the Department for Constitutional Affairs, and the Home Office, were entitled “Statistics on deaths reported to coroners, England and Wales, (year)". Contacts
Current and previous editions of this publication are available for download at: www.gov.uk/government/collections/coroners-and-burials-statistics
The spreadsheet file of the statistical tables referred to in this bulletin is also available for download from this address, along with the CSV file and the Coroners Statistical Tool spreadsheet.
Press enquiries should be directed to the Ministry of Justice press office: Tel: 0203 334 3529 Email: [email protected]
Other enquiries about these statistics should be directed to:
Tara Rose Ministry of Justice 7th Floor (7.07) 102 Petty France London SW1H 9AJ Email: [email protected]
A copy of the data collection form which was sent to coroners may be obtained via the contact details above.
General enquiries about the statistical work of the Ministry of Justice can be e-mailed to: [email protected]
Other National Statistics publications, and general information about the official statistics system of the UK, are available from www.statistics.gov.uk.
© Crown copyright Produced by the Ministry of Justice
Alternative formats are available on request from [email protected]
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70dcd5fc5fee3326fc3f30986f9a5d2ae635c630 | Contents
Contents 2 Introduction 3 Key Findings 7 1: Deaths reported 8 2: Post-mortem examinations held and inquests opened 9 3: Inquests Completed 15 4: Treasure and Treasure Trove 24 Annex A: Map of coroner areas in England and Wales, 2015 26 Annex B: Details of recent coroner area amalgamations 28 Annex C: Further analysis of deaths reported to coroners 29 Explanatory notes 32 Contacts 33 Introduction
This annual bulletin presents statistics of deaths reported to coroners in England and Wales in 2016. Information is provided on the number of deaths reported to coroners, post-mortem examinations and inquests held, and conclusions recorded at inquests. The data are collected via statistical returns completed by coroners. For previous editions of this report, please see:
www.gov.uk/government/collections/coroners-and-burials-statistics
This publication should be read alongside the statistical tables which accompany it, also found via the link above. There is also a supporting comma-separated values (CSV) file to allow users to carry out their own analysis.
In addition to the bulletin and tables, we have published a coroners’ statistical tool (also available at the link above). The tool provides easier access to local level data and allows the user to compare up to four areas of interest, for example, it is possible to compare a coroner area with a geographical region, England or Wales.
The accompanying guide to coroner statistics provides a more detailed overview of coroners; including the functions of coroners and the chief coroner, policy background and changes, statistical revision policies, and data sources and quality. The guide also includes a glossary providing brief definitions for some of the terms used in this bulletin.
The Explanatory Notes section at the end of this bulletin provides information about statistical revisions, and the symbols and conventions used.
If you have any feedback, questions or requests for further information about the bulletin, please direct them to the appropriate contact given at the end of this report.
The legislation
Coroner services in England and Wales are governed by Part 1 of the Coroners and Justice Act 2009 (the 2009 Act), as well as the rules and regulations made under it. The 2009 Act came into force in July 2013, largely replacing the Coroners Act 1988(^1) (the 1988 Act).
The 2009 Act and its rules and regulations can be accessed via the links below:
www.legislation.gov.uk/ukpga/2009/25/contents
(^1) The Coroners Act 1988 was repealed in July 2013 with the exceptions of section 13 (application for a fresh coroner investigation or inquest) and 4A (8) (a coroner in Wales being regarded as a coroner for the whole of Wales). Related statistics
All deaths in England and Wales must be registered with the Registrar of Births and Deaths. For those deaths where a coroner conducts an inquest, the death will be registered at the conclusion of the inquest, and the cause of death classified according to the conclusion recorded by the coroner. Statistics on registered deaths in England and Wales are published by the Office for National Statistics (ONS) in their series on mortality statistics. These can be accessed from the ONS website at:
www.ons.gov.uk/ons/taxonomy/index.html?nscl=Mortality+Rates
The Ministry of Justice’s coroner statistics differ from ONS figures because they count two different, albeit related, events. The Ministry of Justice’s coroner statistics provide the number of deaths which are reported to coroners in England and Wales. These include deaths reported to coroners which occurred outside England and Wales. The ONS mortality statistics, based on death registrations, report the number of deaths registered in England and Wales in a particular year irrespective of whether a coroner has investigated the death. These do not include deaths that occurred outside England and Wales.
The proportion of deaths which are reported to coroners has been estimated using death registration figures published by ONS. Estimates for 2016 have been calculated using ONS’ monthly provisional figures on death registrations, while percentages for 2015 and earlier years have been calculated using final annual death registration figures for the relevant year. Additionally, ONS counts deaths when they have been registered whilst coroners count deaths when they are reported. There can be considerable delay between the date when the death occurred and when the death is registered. Deaths reported to a coroner would not be added to the deaths register until the coroner has concluded their investigation. Therefore it is advised that caution is used when using these figures.
This publication includes figures for deaths reported to coroners which occurred in state custody. Statistics on deaths in prison custody are also published by Her Majesty’s Prison and Probation Service (HMPPS), previously the National Offender Management Service (NOMS), accessible via the following link:
https://www.gov.uk/government/collections/safety-in-custody-statistics
Differences between the two sets of figures are in part due to a time lag in reporting processes. The figures for deaths in custody in this publication relate to those deaths when they have been reported to a coroner in the given year and then reported to MoJ, whereas for the HMPPS publication, deaths are recorded directly after they have occurred. HMPPS figures includes all deaths which have occurred in prison custody and those which occurred whilst the offender was released on temporary licence for medical reasons. This publication also includes figures on deaths reported to coroners of individuals detained under the Mental Health Act (MHA) – similar statistics are published by the Care Quality Commission (CQC)(^2). Differences between the two sets of figures are likely to be due to a time lag in reporting processes: coroners are required to conduct an investigation within six months of the death being reported to them whilst the CQC receives reports of all deaths of individuals detained under the MHA in a particular year. In addition, not all deaths reported to the CQC are reported to a coroner. The CQC also publishes information on the number of deprivation of liberty safeguards applications in their ‘State of Care’ annual report(^3).
This publication includes the number of deaths with a conclusion of suicide recorded at inquest - statistics on suicide deaths are also published by the ONS(^4). The ‘ONS Suicide Statistics UK’ series uses the national statistics’ definition of suicide: deaths given an underlying cause of intentional self-harm or an injury/poisoning of undetermined intent. In 2016, this definition has been modified to include deaths from intentional self-harm in 10- to 14-year-old children in addition to deaths from intentional self-harm and events of undetermined intent in people aged 15 and over.
(^2) The Care Quality Commission (CQC) annual report on Monitoring the Mental Health Act can be found here: [www.cqc.org.uk/content/monitoring-mental-health-act-report](http://www.cqc.org.uk/content/monitoring-mental-health-act-report)
(^3) The annual CQC State of Care report can be found here: [www.cqc.org.uk/content/state-of-care](http://www.cqc.org.uk/content/state-of-care).
(^4) For more on ONS Suicide please visit: [www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/deaths/bulletins/suicidesintheunitedkingdom/previousReleases](http://www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/deaths/bulletins/suicidesintheunitedkingdom/previousReleases) Date of next publication
The next edition of the annual Coroners Statistics is scheduled to be published in May 2018, covering statistics for calendar year 2017.
Users of the statistics
The main users of these statistics are coroners and Ministers and officials in central government to assist in developing coroners’ policy and its subsequent monitoring. Other users include the Chief Coroner, local authorities (who are responsible for appointing and paying coroners as well as funding their services), other central government departments, and those non-governmental bodies, including various voluntary organisations, with an interest in coroners and inquests. The statistics are used to monitor the volume and types of cases dealt with by coroners in England and Wales each year. Key Findings
- 241,211 deaths were reported to coroners in 2016, the highest to date. This shows an increase of 4,805 (2%) from 2015, reflecting the increase in the number of deaths under Deprivation of Liberty Safeguard (DoLS) authorisations reported to coroners.
- Just under half (46%) of all registered deaths were reported to coroners in 2016, up one percentage point on 2015. Over the last ten years, this proportion has been generally stable, within the range of 45% to 47%.
- In 2016, there were 11,376 deaths of individuals subject to DoLS authorisations, 4,193 more than in 2015 (up 58%) reflecting the increase in the number of active DoLS over the same period.
- Deaths in state detention (excluding DoLs) increased by 19%, to 574 deaths being reported to coroners in 2016, with the largest increase seen in deaths while detained under the Mental Health Act (252 in 2016, up 34%) and deaths in prison custody (298, up 14%).
- The number of inquests opened in 2016 increased by 5,769 (up 18%) to 38,626, driven by the increase in deaths while subject to DoLS. All such cases require an inquest.
- There were 86,545 post-mortem examinations ordered by coroners in 2016, 36% of all cases reported to them. This is down two percentage points since 2015, consistent with the long-term downward trend.
- In 2016, 40,504 total inquest conclusions were recorded, up 14% on 2015, reflecting in part the rise in the number of inquests opened.
- Three of the inquest short form conclusions account for almost 68% of all conclusions recorded. These are natural causes (39%) accident and misadventure (19%) and suicide (9%). A further 12% were in the ‘unclassified’ inquest conclusion category.
- Inquest conclusions of natural causes were up 45% on 2015 to 15,962, driven by the majority of DoLS cases having an inquest conclusion of natural causes.
- The two inquest conclusions introduced in 2013, ‘Drugs/Alcohol Related’ and ‘Road Traffic Collision’, have both increased on 2015, up 10% to 2,503 and 16% to 900, respectively.
- In 2016, post-mortem examinations were conducted in 47% of inquest cases, down 9 percentage points on 2015, driven by the increase in deaths of individuals subject to DoLS authorisation. 1: Deaths reported
The number of deaths reported to coroners in 2016 rose by 4,805 (2%) to 241,211, the highest to date. In comparison, ONS registered deaths fell by 4,932 from 2015 to 2016 (down 1%)(^5). The proportion of registered deaths in 2016 that were reported to coroners was 46%, up one percentage point from 2015.
**Figure 1: Registered deaths and deaths reported to coroners, England and Wales, 2004-2016**
Over the last decade, the number of registered deaths in England and Wales initially dropped from 502,599 in 2006 to a low of 484,367 in 2014. It increased to 529,655 in 2015 with the 2016 provisional figures standing at 524,723. The number of deaths reported to coroners followed a similar trend, with 230,007 deaths reported in 2006, falling to a low of 222,371 in 2011 and then rising to a high of 241,211 in 2016.
______________________________________________________________________
(^5) Provisional figure based on ONS monthly death registration figures for 2016 2: Post-mortem examinations held and inquests opened
Post-mortem examinations were held for 86,545 deaths reported to coroners in 2016, down 2,661 (3%) from 2015.
Post-mortem examinations were ordered by coroners in 36% of all deaths reported to them in 2016, down two percentage points on 2015, and consistent with the existing long-term downward trend. Since 1995, the proportion of post-mortem examinations ordered has decreased by 25 percentage points, from 61% to 36% (see Table 3).
There were 38,626 inquests opened in 2016, an increase of 18% on 2015, driven by the increase in deaths of individuals subject to DoLS authorisations, as all such cases require an inquest6.
Inquest cases represented 16% of all the deaths reported to coroners in 2016, an increase of two percentage points on 2015.
Figure 2: Post-mortems and inquests as a percentage of deaths reported to coroners, England and Wales, 2004-2016
______________________________________________________________________
6 More information on DoLS can be found in the section of the Guide to Coroners Statistics published alongside this bulletin. Map 1: Post-mortems held as a proportion of deaths reported to coroners, England and Wales, 2016
The proportion of post-mortems carried out varies from 21% in North Lincolnshire and Grimsby to 62% in Isle of Wight. Map 2: Inquests opened as a proportion of deaths reported to coroners, England and Wales, 2016
The proportion of inquests carried out varies from 8% in Stoke-on-Trent and North Staffordshire to 40% in North Tyneside. Post-mortem examinations in inquest cases
When an inquest is opened, a post-mortem examination will usually be conducted. In 2016, just under half (47%) of inquest cases involved a post-mortem, down 9 percentage points on 2015, driven by the increase in deaths of individuals subject to DoLS authorisation. – all such cases require an inquest, with the majority recording an inquest conclusion of natural causes; a post-mortem examination is therefore unlikely to be required to determine the cause of death and the inquest may well be a ‘paper’ inquest.
Historically, it was quite rare for an inquest to be opened without a post-mortem; however, since 1999 this proportion had been gradually increasing, with sharp increases seen in the last two years. In 2016, 53% of all inquests had no post-mortem, compared with 44% in 2015 and 24% in 2014. This may be attributed to the provisions in the Coroners Act 2009 which came into effect in July 2013, allowing a coroner to conduct a brief investigation prior to making a decision on whether to hold a formal inquest. These are captured in the potential inquest cases below.
Post-mortems in non-inquest cases
In the majority (81%) of cases referred to coroners, there is no inquest. In 2016, there were 62,828 non-inquest cases where a post-mortem was held. The percentage of non-inquest cases that required a post-mortem has fallen from 34% in 2015 to 32% in 2016, continuing the steady downward trend seen since the beginning of the time series (56% in 1995).
Post-mortems in potential inquest cases
Prior to July 2013, cases were either categorised as ‘inquest’ or ‘non-inquest’ cases. Changes in the way coroners are able to conduct an investigation mean that there is now a third category of ‘potential inquest’ cases. This means that the coroner is investigating the death, but has not yet decided whether it is necessary to hold an inquest. Depending on whether or not the coroner deems it necessary to hold an inquest, these cases will all eventually end up in either the ‘inquest’ or ‘non-inquest’ category.
In 2016, there were 6,417 potential inquest cases being dealt with by coroners in England and Wales, with 85% requiring a post-mortem.
Cases requiring neither an inquest nor a post-mortem
There were 133,101 cases reported to coroners where there was neither an inquest nor a post-mortem. This type of case has generally been increasing in number over the years, from 81,701 in 1995 to 132,029 in 2015, with a 1% increase from 2015 to 2016. The proportion of cases where there was neither an inquest nor a post-mortem examination has increased from 66% in 2015 to 68% in 2016, after remaining at 66% since 2012. This continues the upward trend seen prior to 2012, from 44% in 1995 when the time series began. Post-mortem rates, histology(^7) and toxicology(^8)
Post-mortem examinations can be classed as either standard or non-standard, depending on the cost of the examination. A non-standard post-mortem is charged at a higher rate than a standard post-mortem and is defined as a post-mortem which requires special skills. A non-standard post-mortem could, for example, require a paediatric or specialist pathologist. In 2016, almost all (95%) of post-mortems were ordered at a standard rate - this has remained at the same level since 2011.
In 2016, 23% (19,558) of all post-mortems included histology, an increase from 21% (18,659) in 2015. Post-mortems including toxicology also increased over the same period to 16,091 (up 9%), with 19% of all post-mortems held in 2016 including toxicology. This follows the steady rising trend seen since 2011.
Out of England and Wales Orders
To remove a body of a deceased person out of England and Wales, notice must be given to the coroner within whose area the body is lying. When the coroner gives permission for the removal of a body, an Out of England and Wales order is issued.
Coroners issued 5,738 Out of England and Wales orders in 2016, compared with 5,339 issued in 2015. In both years, the number of orders issued represented 2% of the total number of deaths reported to coroners – this proportion has been stable at this level since 2011 (see Table 5).
Deaths abroad
Of the 241,211 deaths reported to coroners in 2016, around 1% (1,849) were reports of deaths that had occurred outside England and Wales. This percentage has remained stable since 2011.
Deaths in State Detention
In 2016, a total of 11,950 deaths which occurred in state detention were reported to coroners(^9), an increase of 4,283 deaths (56%) on the previous year and representing 5% of all deaths reported to coroners.
In 2016, there were 11,376 deaths of individuals subject to DoLS(^10) authorisations, up from 7,183 in 2015. Deaths of individuals subject to DoLS authorisations accounted for 95% of all deaths in state in detention in 2016.
______________________________________________________________________
(^7) Histology in the context of post-mortems is the examination of tissues under a microscope.
(^8) Toxicology in the context of post-mortems is the study of body fluids and tissues for the detection of drugs.
(^9) This data only represents deaths in custody which were referred to a coroner and subsequently reported to MoJ in the coroner’s annual return.
(^10) See the Guide to Coroners Statistics published alongside this bulletin for more information on DoLS. Figure A below shows that the inclusion of deaths of individuals subject to DoLS authorisations within the number of deaths in state detention has distorted the long-term trend. However, the trend in deaths in state detention excluding DoLS is in line with that seen previously and within the Safety in Custody statistics quarterly bulletin (see ‘Related statistics’ section above).
Figure 3: Number of deaths in state detention, by type of detention, 2011-2015 3: Inquests Completed
There were 40,504 inquests conclusions recorded in 2016, up by 5,031 (14%) from 2015, in part reflecting the increase in the number of inquests opened. This is the highest number of inquest conclusions recorded since the series began in 1995.
As in previous years, in 2016 the most common short form conclusions (by order of frequency) were death from natural causes (15,962 or 39%) and death by accident or misadventure (7,692 or 19%) and suicide (3,789 or 9%). Unclassified conclusions (which include narrative verdicts) made up 12% (5,030) of all inquest conclusions in 2016.
Figure 4: Number of conclusions recorded at inquests, England and Wales, 2004-2016
\*Killed unlawfully, Killed lawfully, Attempted or self-induced abortion, Cause of death aggravated by lack of care, or self-neglect, Want of attention at birth, Stillborn, Disasters, Open, Industrial Diseases, Drugs/Alcohol Related, Road traffic collision
The recent (2015 and 2016) increases seen in natural causes, are driven by deaths of individuals subject to DoLS authorisations, where the majority (94%) had an inquest conclusion of natural causes. Historically, natural cause conclusions had been gradually increasing to a peak of 8,881 in 2013, and as
11 For years 2004-2013, this includes the previously used conclusions “Dependence on Drugs” and “Non-dependence on Drugs” a proportion, accounted for 25-30% of all inquest conclusions (between 2006 and 2013). In 2014 it almost halved (down 45%), to 4,873 (17% of all inquest conclusions). This was driven by the Coroners Act 2009 coming into force in July 2013 which meant coroners could issue death certificate without an inquest if the death was from natural causes.
Figure 5 below shows the time series of natural cause inquest conclusions when including or excluding DoLs. In total, natural conclusions made up 31% and 39% of all inquest conclusions in 2015 and 2016. However, when excluding the DoLs cases, natural causes only made up 12% and 13% of all inquest conclusions respectively, suggesting the continued impact of the Coroner Act 2009 reforms.
Figure 5: Number of conclusions recorded at inquests, England and Wales, 2004-2016
In 2016, the number of unclassified conclusions increased by 160 cases (up 3%) to 5,030, continuing the long term increasing trend seen from 2000 to 2013 and showing a reversal of the decreases seen in 2014 and 2015 in this category.
The rise in unclassified conclusions seen until 2014 is partly due to the increasing use of what are known as ‘narrative conclusions’ by some coroners. In these cases, the conclusion is recorded as unclassified. As well as narrative conclusions, this category includes short non-standard conclusions which a coroner or jury might return when the circumstances do not easily fit any of the standard conclusions\\textsuperscript{12}.
For the remaining conclusion types, drugs and alcohol related cases increased by 236 cases (up 10%) to 2,503 and road traffic collisions by 121 cases (up 16%) to 900. These two categories were added as short form conclusions in Coroner Statistics 2014, resulting in the large increase seen in figure 4, for the ‘all other conclusion’ group.
Open conclusions have been decreasing over the same period, particularly over the last few years - they accounted for 4% in 2016 compared with 9% in 2006.
Figure 6 shows the proportion changes in inquest conclusions between 2015 and 2016. The natural cause inquest conclusion has had the largest shift, increasing its share by 8 percentage points compared to 2015. Both suicide and accident and misadventure inquest conclusions showed slight decreases when compared to 2015, down 2 and 3 percentage points respectively.
\\textsuperscript{12} An analysis on unclassified conclusions can be found in the Coroners Statistics 2012 publication (Annex A), available at: www.gov.uk/government/publications/coroners-statistics Figure 6: Conclusions recorded at inquest, by category and as a proportion of all conclusions, England and Wales, 2015 and 2016
Figures may not equal 100% due to rounding.
All other conclusions (including Killed unlawfully, Killed lawfully, Attempted or self-induced abortion, Cause of death aggravated by lack of care, or self-neglect, Stillborn) were not included in the chart as they represented less than 1% of the short-form conclusions. The proportion of conclusions recorded as suicide varies from 1% in Portsmouth and South East Hampshire and Gateshead and South Tyneside to 25% in East Sussex.
**Differences in conclusions recorded by gender**
The pattern of conclusions recorded differs between males and females. Male deaths accounted for 57% of all conclusions recorded in 2016, however they accounted for 54% of deaths reported; this suggests that males are more likely to die in circumstances that lead to an inquest. Female deaths accounted for 43% of all conclusions recorded in 2016 (and 46% of all deaths reported).
Figure 6 shows the variation in the gender proportions, depending on the type on inquest conclusion. Industrial disease had the highest proportion of males, at 92% and natural causes had the highest proportion of females, with 59%.
**Figure 7: Conclusions recorded at inquests by gender, England and Wales, 2016**
| Conclusion | Male | Female | |-----------------------------|------|--------| | Natural causes | 41% | 59% | | Accident/Misadventure | 57% | 43% | | Suicide | 77% | 23% | | Industrial disease | 92% | 8% | | Drugs/Alcohol related | 77% | 23% | | Open | 71% | 29% | | Road traffic collision | 77% | 23% | | Unclassified | 58% | 42% | | All other conclusion\* | 71% | 29% |
\*Killed unlawfully, Killed lawfully, Attempted or self-induced abortion, Stillborn, Neglect, Want of Attention at Birth, and Disaster
**Age of deceased in inquests where a conclusion was recorded**
Since 2008, coroners have been asked to provide information (in summary form) on the ages of persons in inquest cases where a conclusion was recorded. Of the inquests completed in 2016, 66% related to persons who were aged 65 years or over at time of death compared with 5% related to persons under 25 years of age (see Table 8). Although an age breakdown of registered deaths in England and Wales in 2016 is not yet available, ONS figures for 2015 show that 85% of registered deaths in England and Wales were persons aged 65 or over, with only 1% aged under 25 years old.
The profile of the age of deceased at inquests has changed slightly from 2015 to 2016. The percentage of inquests completed relating to persons aged 65 or over has increased from 61% to 66%, while the percentage of those between 25 and 65 years has fallen from 34% to 30%. This may be due to the increase in the number of deaths of individuals subject to DoLS authorisations, all of which require an inquest and may predominantly relate to the older population.
**Figure 8: Age of deceased in inquests where a conclusion was recorded, England and Wales, 2016**
| Age Group | 2016 | 2015 | |--------------------|------|------| | 65 year and over | 66% | 61% | | 45 to 64 years | 17% | 19% | | 15 to 24 years | 13% | 4% | | Under 14 years | 3% | 2% |
**Inquests with juries and adjourned inquests**
There were 576 inquests held with juries in 2016 (representing 1% of all inquests), an increase of 119 compared to 2015.
The number of inquests held with juries showed a downward trend until 2013, but it has increased year on year since 2014 to the highest level since 2003. This mirrors the upward trend in the number of inquests held and the more recent upward trend in deaths in state detention. The proportion of inquests held with juries has however remained stable at between 1% and 2% over the last eleven years (see Table 9).
In 2016, 753 inquests were adjourned (and not resumed) by the coroner under Schedule 1 of the Coroners and Justice Act 2009 because criminal proceedings took place. This represents 2% of all inquests concluded, the same proportion as 2013 to 2015, and slightly less than in earlier years - around 3% since 2006.
______________________________________________________________________
15 The ‘age not known’ category has been excluded from the chart due to small numbers (less than 0.5%). Totals may not add up to 100% due to rounding.
16 Schedule 1 of the Coroners and Justice Act 2009 states that the coroner should adjourn an inquest in the event that criminal proceedings may or will take place. Time taken to process an inquest
The estimated\\textsuperscript{17} average time taken to process an inquest in 2016 (defined as being from the date the death was reported until the conclusion of the inquest) was 18 weeks (see Table 13)\\textsuperscript{18}, a reduction of two week compared to 2015. This can largely be attributed to DoLS where, in accordance with the Chief Coroner’s guidance, in uncontroversial cases, an inquest can be a ‘paper inquest’, i.e. decided in open court but on papers without the needs for witnesses or a post-mortem.
The time taken to process an inquest varies by coroner area - the maximum average time taken to process an inquest in 2016 was 40 weeks, and the minimum average time was 5 weeks. The large range of average time (35 weeks – based on 5 and 40 weeks) could be due to the fact that coroners’ caseloads can vary greatly and a direct comparison between coroner areas is therefore not advised.
More information about how the average time taken has been estimated can be found in the explanatory notes section of this report.
\\textsuperscript{17} A direct average of the time taken to process an inquest cannot be calculated from the summary data collected; an estimate has been made instead. Please see the explanatory notes section of this report for more information.
\\textsuperscript{18} Only deaths occurring within England and Wales are included in this estimation. The average time taken to process an inquest varies from 5 weeks in Hartlepool to 40 weeks in Isle of Wight. 4: Treasure and Treasure Trove
On 24 September 1997, the Treasure Act 1996 came into force and replaced the common law of Treasure Trove in England and Wales. The 1996 Act introduced new requirements for reporting and dealing with finds. Not all finds need be the subject of an inquest. For more information please see: www.legislation.gov.uk/ukpga/1996/24/contents
In 2016, 804 finds were reported and 341 inquests were concluded. In addition, there were two inquests held into Treasure Trove in 2016 (relating to finds made before the current Act came into force), and it is likely that a few such inquests will continue to be held from time to time.
The number of finds reported was steadily increasing over the last ten years but decreased slightly to 804 in 2016 from the peak of 810 in 2015 (down 1%). Of those 341 inquests concluded in 2016, 96% (326) returned a verdict of treasure, the same proportion as in 2015.
An annual report on the operation of the Treasure Act 1996 is published by the Department for Culture, Media and Sport. For more information please see: www.gov.uk/government/organisations/department-for-culture-media-sport/series/treasure-and-portable-antiquities-statistics
Figure 9: Finds reported to coroners, treasure inquests held under the Treasure Act, and proportion of treasure verdicts returned, 2004-2016
19 This chart does not include reported findings under “Treasure Trove” Map 5: Number of treasure finds reported to coroners, England and Wales, 2016
Thirty coroner areas had no treasure finds reported to them. Suffolk had the highest number of treasure finds at 77. Annex A: Map of coroner areas in England and Wales, 2016
## Key to coroner areas
### North East
- 101 – County Durham and Darlington
- 103 – Hartlepool
- 104 – North Northumberland
- 105 – South Northumberland
- 106 – Teesside
- 107 – Gateshead and South Tyneside
- 108 – Newcastle upon Tyne
- 109 – North Tyneside
- 110 – Sunderland
### North West
- 201 – Cheshire
- 203 – Cumbria
- 205 – Manchester (city)
- 206 – Manchester North
- 207 – Manchester South
- 208 – Manchester West
- 209 – Blackburn, Hyndburn and Ribble Valley
- 210 – Blackpool and Fylde
- 211 – East Lancashire
- 212 – Preston and West Lancashire
- 213 – Sefton, Knowsley and St Helens
- 214 – Liverpool and the Wirral
### Yorkshire and the Humber
- 301 – East Riding and Hull
- 302 – North Lincolnshire and Grimsby
- 303 – York City
- 304 – North Yorkshire - East
- 305 – North Yorkshire - West
- 306 – South Yorkshire - East
- 307 – South Yorkshire - West
- 308 – West Yorkshire - East
- 309 – West Yorkshire - West
### East Midlands
- 401 – Derby and Derbyshire
- 403 – Leicester and South Leicestershire
- 404 – North Leicestershire and Rutland
- 406 – Central Lincolnshire
- 408 – South Lincolnshire
- 409 – Northamptonshire
- 410 – Nottinghamshire
### West Midlands
- 501 – Herefordshire
- 502 – Shropshire, Telford and Wrekin
- 504 – Staffordshire South
- 505 – Stoke-on-Trent and North Staffordshire
- 507 – Warwickshire
- 508 – Birmingham and Solihull
- 509 – Black Country
- 510 – Coventry
- 512 – Worcestershire
### East of England
- 601 – Bedfordshire and Luton
- 602 – Cambridgeshire and Peterborough
- 604 – Essex
- 605 – Hertfordshire
- 607 – Norfolk
- 611 – Suffolk
### London
- 701 – City of London [not visible]
- 702 – East London
- 703 – Inner London North
- 704 – Inner London South
- 705 – Inner London West
- 706 – North London
- 707 – South London
- 708 – West London
### South East
- 801 – Berkshire
- 802 – Brighton and Hove
- 803 – Buckinghamshire
- 804 – East Sussex
- 805 – Central Hampshire
- 806 – North East Hampshire
- 807 – Portsmouth and South East Hampshire
- 808 – Southampton and New Forest
- 809 – Isle of Wight
- 810 – Central and South East Kent
- 811 – Mid Kent and Medway
- 812 – North East Kent
- 813 – North West Kent
- 814 – Milton Keynes
- 815 – Oxfordshire
- 816 – Surrey
- 817 – West Sussex
### South West
- 901 – Avon
- 902 – Cornwall and Isles of Scilly
- 903 – Exeter and Greater Devon
- 904 – Plymouth, Torbay and South Devon
- 906 – Dorset
- 908 – Gloucestershire
- 910 – Somerset
- 912 – Wiltshire and Swindon
### Wales
- 1001 – South Central Wales
- 1003 – Carmarthenshire and Pembrokeshire
- 1004 – North Wales (East and Central)
- 1005 – Ceredigion
- 1006 – Gwent
- 1007 – Swansea and Neath Port Talbot
- 1009 – North West Wales Annex B: Details of recent coroner area amalgamations
The following table summarises the coroner area amalgamations that have occurred since the 2014. Coroner areas formed during 2016 are reported on by their new areas within this bulletin.
| Date effective | Previous coroner area | New coroner area | Nature of merge | |----------------|-----------------------|------------------|-----------------| | 01-Jan-15 | North and West Cumbria; South and East Cumbria | Cumbria | 2 into 1 | | 02-Apr-15 | Liverpool; the Wirral | Liverpool and the Wirral | 2 into 1 | | 01-Aug-15 | North and East Cambridgeshire; South and West Cambridgeshire; Peterborough | Cambridgeshire and Peterborough | 3 into 1 | | 01-Apr-16 | East Somerset; West Somerset | Somerset<sup>20</sup> | 2 into 1 | | 01-Apr-16 | Cornwall; the Isles of Scilly | Cornwall and the Isles of Scilly | 2 into 1 | | 01-Apr-16 | Cardiff and Vale of Glamorgan; Powys, Bridgend & Glamorgan Valleys; | South Wales Central | 2 into 1 |
<sup>20</sup> In 2015 a coroner data return was received from Somerset coroner area, even though this area did not officially come into force until 1st April 2016. Therefore it was not possible to report on East Somerset and West Somerset coroner areas individually in 2015, even though they were officially separate Coroners Areas during this year. Annex C: Further analysis of deaths reported to coroners
The number of deaths reported to coroners in 2016 varied by coroner area – from 218 in City of London to 7,100 in Essex. The number of deaths reported in each area will be affected by its size, population and demographic breakdown so comparisons of deaths reported to the coroner across coroner areas should be treated with caution.
Figure C1: Number of deaths reported to coroners, 2016
When looking at the number of deaths reported to coroners in 2016 as a proportion of registered deaths(^{21}), which allow for some differences in population characteristics, there is still a wide variation across coroner areas e.g. 28% in East Lancashire compared to 96% in Stoke-on-Trent and North Staffordshire. However, caution should be taken when using these figures as local area factors can influence these proportions. For example large hospitals near boundary lines can impact the proportion, due to the difference between the coroners figures being based on the place of death and the ONS figures being based on the place of residence.
______________________________________________________________________
(^{21}) As the ONS death registration figures are based on area of usual residence whereas the coroners’ figures are based on the area where a person died, these figures should be used with caution. For example, the coroner office for the City of London shows a distorted figure of 532% due to the low levels of residence and high level of commuters. Map C below shows deaths reported in each coroner area in 2016 as a percentage of the total registered deaths in each area\\textsuperscript{22}.
**Map C: Deaths reported to coroners as a percentage of total registered deaths in each area\\textsuperscript{23}, England and Wales, 2016**
\\textsuperscript{22} The registered deaths figure for 2016 is provisional, based on ONS monthly death registration figures.
\\textsuperscript{23} The ONS death registration figures are based on area of usual residence whereas the coroners’ figures are based on the area where a person died. Therefore the coroner office for the City of London shows a distorted figure of 532% due to the low levels of residence and high level of commuters. The proportion of deaths reported to the coroner varies from 28% in East Lancashire to 96% in Stoke-on-Trent and North Staffordshire compared to the national average of 46%.
**Figure C2: Deaths reported to coroners in 2016 as a proportion of registered deaths**
______________________________________________________________________
24 Provisional figure based on ONS monthly death registration figures for 2016
25 Data for the City of London has been excluded from this analysis due to the small size of this coroner area. The total number of coroner areas shown in Figure C2 is therefore 91. Explanatory notes
The United Kingdom Statistics Authority has designated these statistics as National Statistics, in accordance with the Statistics and Registration Service Act 2007 and signifying compliance with the Code of Practice for Official Statistics.
Designation can be broadly interpreted to mean that the statistics:
- meet identified user needs;
- are well explained and readily accessible;
- are produced according to sound methods, and
- are managed impartially and objectively in the public interest.
Once statistics have been designated as National Statistics it is a statutory requirement that the Code of Practice shall continue to be observed.
The data analysed in this publication are based on annual returns from coroners. Thanks are due to coroners and their staff for their work in preparing these returns.
Information on the quality and consistency of the Coroners statistics can be found in the supporting document published alongside this bulletin.
Revisions to statistics for previous years
The estimated figure for the number of registered deaths in 2015 which was derived from monthly data for the purposes of Table 2 in last year’s edition of this bulletin has now been replaced by the annual figure published by the Office for National Statistics.
Symbols and conventions
The following symbols have been used throughout the tables in this bulletin:
- n/a = Not applicable
- - = Zero
- .. = No data available
- (p) = provisional data
- (r) = Revised data Contacts
Current and previous editions of this publication are available for download at:
www.gov.uk/government/collections/coroners-and-burials-statistics
The spreadsheet file of the statistical tables referred to in this bulletin is also available for download from this address, along with the CSV file and the Coroners Statistical Tool spreadsheet.
Press enquiries should be directed to the Ministry of Justice press office:
Tel: 0203 334 3529 Email: [email protected]
Other enquiries about these statistics should be directed to:
Bridgette Miles Ministry of Justice 7th Floor (7.07) 102 Petty France London SW1H 9AJ Email: [email protected]
A copy of the data collection form which was sent to coroners may be obtained via the contact details above.
General enquiries about the statistical work of the Ministry of Justice can be e-mailed to: [email protected]
Other National Statistics publications, and general information about the official statistics system of the UK, are available from www.statistics.gov.uk.
© Crown copyright Produced by the Ministry of Justice
Alternative formats are available on request from [email protected]
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71fce0a966ff4d376bf2839e74bd6b024e8b416f | CSV Metadata for Coroners Statistics 2015 publication
Any questions regarding the CSV file should be directed to [email protected]
| Column Name | Description | |-------------|-------------| | Year | Year | | District | Coroner area | | Coroner_Region | Coroner region | | Region | Region | | Country | Country | | Country2 | England and Wales | | PM_NIQ_M | With Post Mortem but no inquest Male | | PM_NIQ_F | With Post Mortem but no inquest Female | | PM_NIQ_T | With Post Mortem but no inquest Total | | PM_IQ_M | With Post Mortem & inquest Male | | PM_IQ_F | With Post Mortem & inquest Female | | PM_IQ_T | With Post Mortem & inquest Total | | PM_PIQ_M | With Post Mortem and possible inquest Male | | PM_PIQ_F | With Post Mortem and possible inquest Female | | PM_PIQ_T | With Post Mortem and possible inquest Total | | PM_TDR_M | With Post Mortem total deaths reported Male | | PM_TDR_F | With Post Mortem total deaths reported Female | | PM_TDR_T | With Post Mortem total deaths reported Total | | WPM_NIQ_M | No Post Mortem and no inquest Male | | WPM_NIQ_F | No Post Mortem and no inquest Female | | WPM_NIQ_T | No Post Mortem and no inquest Male & Female Total | | WPM_IQ_M | An inquest but no post mortem Male | | WPM_IQ_F | An inquest but no post mortem Female | | WPM_IQ_T | An inquest but no post mortem Total | | WPM_PIQ_M | Possible inquest, but no Post Mortem Male | | WPM_PIQ_F | Possible inquest, but no Post Mortem Female | | WPM_PIQ_T | Possible inquest, but no Post Mortem Total | | WPM_TDR_M | Total deaths reported without a post mortem Male | | Code | Description | |------------|-----------------------------------------------------------------------------| | WPM_TDR_F | Total deaths reported without a post mortem Female | | WPM_TDR_T | Total deaths reported without a post mortem Male & Female Total | | TDR_NIQ_M | Total deaths reported where no inquest Male | | TDR_NIQ_F | Total deaths reported where no inquest Female | | TDR_NIQ_T | Total deaths reported where no inquest Male & Female Total | | TDR_IQ_M | Total deaths reported with an inquest Male | | TDR_IQ_F | Total deaths reported with an inquest Female | | TDR_IQ_T | Total deaths reported with an inquest Male & Female Total | | TDR_PIQ_M | Total deaths reported where inquest is possible Male | | TDR_PIQ_F | Total deaths reported where inquest is possible Female | | TDR_PIQ_T | Total deaths reported where inquest is possible Total | | TDR_TDR_M | Total Male deaths reported | | TDR_TDR_F | Total Female deaths reported | | TDR_TDR_T | Total Deaths reported Male & Female | | Transferred | Transferred cases | | Sex unknown| Deaths reported where Sex unknown | | PM_Standard| Standard rate Post Mortems | | PM_NonStandard| Non-standard rate Post Mortems | | PM_Total | TOTAL Standard + Non-standard Post Mortems | | PM_Hist | Post Mortems including Histology | | PM_Tox | Post Mortems including Toxicology | | Out_Eng | Out of England Orders | | Elsewhere | Deaths Abroad | | Custody_prison | Death in prison custody | | Custody_police | Death in police custody | | Custody_imm | Death in immigration removal centre | | Custody_MHA | Death in Mental Health Act detention | | Custody_probation | Death in probation approved premises | | Custody_STC | Death in secure training centre | | Custody_SCH | Death in secure childrens homes | | Custody_ROTL | Death whilst on ROTL | | Custody_prison7 | Death within 7 days of custody release | | Code | Description | |----------|--------------------------------------------------| | CUSTODY_DOLS | Deaths whilst under a Deprivation of Liberties Order | | Custody_Total | Total deaths in custody | | KUL_M | Killed Unlawfully Male | | KUL_F | Killed Unlawfully Female | | KUL_T | Killed Unlawfully Total | | KL_M | Killed Lawfully Male | | KL_F | Killed Lawfully Female | | KL_T | Killed Lawfully Total | | Suicide_M | Suicide Male | | Suicide_F | Suicide Female | | Suicide_T | Suicide Total | | Abor_M | Abortion Male | | Abor_F | Abortion Female | | Abor_T | Abortion Total | | Negl_M | Neglect Male | | Negl_F | Neglect Female | | Negl_T | Neglect Total | | DRUGS_ALC_M | Drugs/Alcohol Related Male | | DRUGS_ALC_F | Drugs/Alcohol Related Female | | DRUGS_ALC_T | Drugs/Alcohol Related Total | | COLLISION_M | Road Traffic Collision Male | | COLLISION_F | Road Traffic Collision Female | | COLLISION_T | Road Traffic Collision Total | | D_Drugs_M | Drug dependence Male | | D_Drugs_F | Drug dependence Female | | D_Drugs_T | Drug dependence Total | | ND_Drugs_M | Non-dependent drugs Male | | ND_Drugs_F | Non-dependent drugs Female | | ND_Drugs_T | Non-dependent drugs Total | | WAB_M | Want of Attention at Birth Male | | WAB_F | Want of Attention at Birth Female | | WAB_T | Want of Attention at Birth Total | | Code | Description | |--------|------------------------------| | IND_M | Industrial Disease Male | | IND_F | Industrial Disease Female | | IND_T | Industrial Disease Total | | DBMIS_M| Acct/ Misadventure Male | | DBMIS_F| Acct/ Misadventure Female | | DBMIS_T| Acct/ Misadventure Total | | Still_M| Stillborn Male | | Still_F| Stillborn Female | | Still_T| Stillborn Total | | DBNC_M | Natural Causes Male | | DBNC_F | Natural Causes Female | | DBNC_T | Natural Causes Total | | Open_M | Open verdict Male | | Open_F | Open verdict Female | | Open_T | Open verdict Total | | Dis_M | Disaster Male | | Dis_F | Disaster Female | | Dis_T | Disaster Total | | Unclass_M| Unclassified Male | | Unclass_F| Unclassified Female | | Unclass_T| Unclassified Total | | Total_Verdicts_M| Total verdicts Male | | Total_Verdicts_F| Total verdicts Female | | Total_Verdicts_T| Total verdicts returned TOTAL| | Age_0_1_years| Age of deceased under 1 year| | Age_1_14_years| Age of deceased 1 to 14 years| | Age_15_24_years| Age of deceased 15 to 24 years| | Age_25_44_years| Age of deceased 25 to 44 years| | Age_45_64_years| Age of deceased 45 to 64 years| | Age_over65_years| Age of deceased over 65 years| | Age_not_known| Age of deceased not known | | Murder_T| Inquest adjourned Murder Total | | Category | Description | |--------------------------------|--------------------------------------------------| | Manslaughter_T | Inquest adjourned Manslaughter Total | | Infanticide_T | Inquest adjourned Infanticide Total | | RTA_T | Inquest adjourned RTA Total | | Aid_suicide_T | Inquest adjourned Aid or assist suicide Total | | Corp_Manslaughter_T | Inquest adjourned Corporate Manslaughter Total | | Other_Charges_T | Inquest adjourned Other Charges Total | | Disaster_T | Inquest adjourned Disaster Total | | All_Charges_T | TOTAL inquests adjourned | | Inq_with_juries | Inquest held with juries | | Inq_without_juries | Inquest held without juries | | Inq_Total | TOTAL Inquests held | | Inq_held_HC | Inquest held order of High Court | | Inq_quashed_HC | Inquest quashed order of High Court | | Inq_Total_treasure_tr | Treasure Trove inquests | | TA96_Finds | Number of treasure finds | | TA96_Inq | Number of treasure inquests concluded | | TA96_Verdicts | Number of treasure verdicts | | Exhumations | Number of exhumations | | Cases_NIQ_1_week_or_less | Disposal certs issued 1 week or less for non-inquests | | Cases_NIQ_up_to_1_month | Disposal certs issued up to 1 month for non-inquests | | Cases_NIQ_over_1_month | Disposal certs issued over 1 month for non-inquests | | Cases_NIQ_certs_total | Disposal certs issued for non-inquests total | | Cases_NIQ_no_certs_total | No disposal certs issued for non-inquests total | | Cases_IQ_1_week_or_less | Disposal certs issued 1 week or less for inquests | | Cases_IQ_up_to_1_month | Disposal certs issued up to 1 month for inquests | | Cases_IQ_over_1_month | Disposal certs issued over 1 month for inquests | | Cases_IQ_certs_total_EW | Disposal certs issued for inquests total E+W | | Cases_IQ_certs_total_AB | Disposal certs issued for non-inquests total Abroad | | Cases_PIQ_1_week_or_less | Disposal certs issued 1 week or less for possible inquests | | Cases_PIQ_up_to_1_month | Disposal certs issued up to 1 month for possible inquests | | Cases_PIQ_over_1_month | Disposal certs issued over 1 month for possible inquests | | Cases_PIQ_certs_total | Disposal certs issued for possible inquests total | | Cases_PIQ_no_certs_total | No disposal certs issued for possible inquests total | |--------------------------|------------------------------------------------------| | Cases_1_month_or_less_EW | Inquest concluded/adjourned 1 month or less E+W | | Cases_1_to_3_months_EW | Inquest concluded/adjourned 1 to 3 months E+W | | Cases_3_to_6_months_EW | Inquest concluded/adjourned 3 to 6 months E+W | | Cases_6_to_12_months_EW | Inquest concluded/adjourned 6 to 12 months E+W | | Cases_over_12_months_EW | Inquest concluded/adjourned over 12 months E+W | | Cases_Total_EW | Total Inquest concluded/adjourned (E+W) | | Cases_Total_AB | Total Inquest concluded/adjourned (Abroad) | | Cases_Total | TOTAL Inquest concluded/adjourned | | Inq_op_6_months_or_less_EW | Inquests still open 6 months or less E+W | | Inq_op_6_to_12_months_EW | Inquests still open 6 to 12 months E+W | | Inq_op_1_to_2_years_EW | Inquests still open 1 to 2 years E+W | | Inq_op_over_2_years_EW | Inquests still open over 2 years E+W | | Inq_op_Total_EW | TOTAL Inquests still open E+W | | Inq_op_6_months_or_less_AB | Inquests still open 6 months or less Abroad | | Inq_op_6_to_12_months_AB | Inquests still open 6 to 12 months Abroad | | Inq_op_1_to_2_years_AB | Inquests still open 1 to 2 years Abroad | | Inq_op_over_2_years_AB | Inquests still open over 2 years Abroad | | Inq_op_Total_AB | TOTAL Inquests still open Abroad | | Inq_op_Total | TOTAL Inquests still open (Abroad and E&W) | | Av_wks | Approximate average number of weeks to conclude Inquest | | WPM_NIQ_TDR | Total deaths reported with no post mortem or inquest TOTAL (M&F and unknown sex total) | | WPM_TDR_TDR | Total deaths reported with no post mortem TOTAL (M&F and unknown sex total) | | TDR_NIQ_TDR | Total deaths reported with no inquest TOTAL (M&F and unknown sex total) | | TDR_TDR_TDR | TOTAL deaths reported | | Grouped_verdicts_M | Sum of Abortion, WAB, Stillborn, Disaster & Unclassified verdicts Male | | Grouped_verdicts_F | Sum of Abortion, WAB, Stillborn, Disaster & Unclassified verdicts Female | | Grouped_verdicts_T | Sum of Abortion, WAB, Stillborn, Disaster & Unclassified verdicts TOTAL | | Inq_op_6_months_or_less_T | Inquests still open 6 months or less TOTAL (E&W and Abroad) | | Inq_op_6_to_12_months_T | Inquests still open 6 to 12 months TOTAL (E&W and Abroad) | | Inq_op_1_to_2_years_T | Inquests still open 1 to 2 years TOTAL (E&W and Abroad) | | Inq_op_over_2_years_T | Inquests still open over 2 years TOTAL (E&W and Abroad) |
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6ccb99430881ba1d74d78f236f264a231efc41d5 | Contents
Executive Summary 4 Introduction 5 Deaths reported 9 Post-mortem examinations held and inquests opened 11 Inquest verdicts returned 15 Treasure and Treasure Trove 21 Map 7 Coroner districts in England and Wales, 2012 23 Annex A: Analysis of Unclassified verdicts 25 Explanatory notes 34 Glossary 37 Contacts 40 Executive Summary
This bulletin presents statistics of coroners’ work during the calendar year 2012, including deaths reported, post-mortems, and inquests (including those for treasure and treasure trove). These figures are used to monitor coroners’ workload, throughput of cases, and percentages of post-mortems and inquests. In previous years this report was entitled “Statistics on deaths reported to coroners, England and Wales, (year)”.
- Some 227,721 deaths were reported to coroners in 2012, an increase of 5,350 (two per cent) from the 2011 figure.
- The proportion of all registered deaths reported to coroners was an estimated 46 per cent in 2012, the same as in 2011. Over the last five years this proportion has been relatively consistent, within the range 46 to 47 per cent.
- The estimated average time taken to process an inquest in 2012 (defined as being from the time the death was reported until the conclusion of the inquest, where the death occurred in England and Wales) was 26 weeks, slightly less than the last three years’ figure of 27 weeks. The maximum time taken to process an inquest in 2012 was 53 weeks, and the minimum time was eight weeks.
- Verdicts of suicide rose by one per cent in 2012 compared to 2011, from 3,471 to 3,515.
- Also rising were the number of unclassified verdicts, a category which includes narrative verdicts, which are a factual record of how and in what circumstances the death occurred, often returned where the cause of death does not easily fit any of the standard short-form verdicts.
- As in recent years, the most common verdicts returned at inquests were death from natural causes (in 29 per cent of cases) and death by accident or misadventure (26 per cent). Introduction
This annual bulletin presents statistics of deaths reported to coroners in England and Wales in 2012 in accordance with section 28 of the Coroners Act 1988. Information is provided on deaths reported to coroners, post-mortem examinations and inquests held, and verdicts returned at inquests. The data are collected via statistical returns completed by coroners. In previous years this report was entitled “Statistics on deaths reported to coroners, England and Wales, (year)”. For previous editions of this report please see:
www.gov.uk/government/publications/coroners-statistics-ns
This publication should be read alongside the statistical tables which accompany it, also found via the link above.
Background
In England and Wales, coroners are required by law to hold an inquest into violent, unnatural, sudden deaths of unknown cause, and those deaths which occur in prison or police custody. When investigating a death, it is the coroner’s duty to establish who the deceased was, and how, when and where the death occurred. At the close of an inquest, coroners (or juries if they have been summoned) are required to return a verdict covering these questions and to certify the verdict in an inquisition (the written record of the inquest).
In the majority (86 per cent) of deaths reported to them, however, coroners’ investigations are concluded without an inquest being held. The coroner will have satisfied themselves, by means of a post-mortem examination or other investigation, on the physical cause of death, and that the death was not one on which he or she is required by law to hold an inquest.
Verdicts are returned in nearly all inquests (97 per cent). The exceptions are inquests adjourned by the coroner if, for example, criminal proceedings take place. The inquest is usually not resumed because the relevant evidence has been heard elsewhere. Nearly all inquests (98 per cent) are held by a coroner sitting alone, without a jury, but a jury must be summoned in some circumstances, for example where the death occurred in prison or police custody.
A coroner may request that a post-mortem be conducted, whether or not an inquest is held, particularly if the cause of death is not clear. In many cases a post-mortem examination may take place in order to determine whether or not an inquest is necessary.
Figure 1 shows the possible outcomes involved when a death is reported to a coroner. In England and Wales a coroner also handles investigations regarding finds reported to them under the provisions of the Treasure Act 1996. The coroner will inquire into any treasure which is found in their districts and establish who the finders were.
The Explanatory Notes section at the end of this report provides brief definitions for some of the terms used in this report, information about statistical revisions, and the symbols and conventions used.
If you have any feedback, questions or requests for further information about this statistics bulletin, please direct them to the appropriate contact given at the end of this report.
**Related statistics**
All deaths in England and Wales must be registered with the Registrar of Births and Deaths. For those deaths where a coroner conducts an inquest, the death will be registered at the conclusion of the inquest, and the cause of death classified according to the verdict returned by the coroner. Statistics on
______________________________________________________________________
1 This covers events during 2012, for example the verdicts in 2012 may relate to cases from 2012 or earlier years. It is not possible to follow the flow of cases through the system due to the way the data is collected. registered deaths in England and Wales are published by the Office for National Statistics (ONS) in their series on mortality statistics. These can be accessed from the ONS website at:
www.statistics.gov.uk/hub/population/deaths/mortality-rates/index.html
For annual summary of monthly figures please see:
www.ons.gov.uk/ons/rel/vsob2/monthly-figures-on-deaths-registered-by-area-of-usual-residence--england-and-wales/index.html
The Ministry of Justice's coroner statistics differ from ONS figures because they count two different, albeit related, events. The Ministry of Justice's coroner statistics provide the number of deaths which are reported to coroners in England and Wales. These include deaths reported to coroners which occurred outside England and Wales. The ONS' mortality statistics, based on death registrations, report the number of deaths registered (irrespective of whether a coroner has investigated) in England and Wales in a particular year, and therefore do not include deaths that occurred outside England and Wales.
The proportion of deaths which are reported to coroners has been estimated(^2) using death registration figures published by ONS. Estimates for 2012 have been calculated using ONS' monthly provisional figures on death registrations, while percentages for 2011 and earlier years have been calculated using final annual death registration figures for the relevant year.
For the first time this publication includes figures for deaths which occurred in state custody. Statistics on deaths in prison custody are also published by NOMS, accessible via the following link:
www.gov.uk/government/publications/safety-in-custody
The figures for deaths in custody in this publication relate only to those deaths which have been reported to a coroner, whereas the NOMS publication includes all deaths which have occurred in prison custody and those which occurred whilst the offender was released on temporary licence (ROTL) for medical reasons.
The Youth Justice Board also include figures for deaths of young people (under 18) in custody in the Youth Justice Statistics publication, accessible via the link below:
www.gov.uk/government/publications/youth-justice-statistics
(^2) Statistics on the number of registered deaths in England and Wales are published by the Office for National Statistics. A final figure for the total number of registered deaths in 2012 has not yet been published, so a provisional figure from ONS, derived from the monthly figures for death registrations in England and Wales, has been used. For further information on criminal convictions of homicide please refer to Volume 5 of the Ministry of Justice publication Criminal Justice Statistics, available at the following link:
www.gov.uk/government/organisations/ministry-of-justice/series/criminal-justice-statistics
The Criminal Justice Statistics publication includes figures on the number of prosecutions and convictions of homicide. The Coroner Statistics publication records the number of verdicts of homicide recorded by coroners at inquests so these numbers are not directly comparable as the Criminal Justice Statistics covers all prosecutions and convictions for homicide, while the coroner data only covers cases where a verdict of homicide has been given at an inquest. Deaths reported
The number of deaths reported to coroners in 2012 rose by 5,350 (two per cent) from the previous year, from 222,371 in 2011 to 227,721 during 2012, reflecting the increase in the number of deaths registered in England and Wales. The proportion of registered deaths in the calendar year 2012 that were reported to coroners in 2012 was an estimated 46 per cent, the same as in 2011. This percentage has shown a slight downward trend over the last few years.
Map 1 below shows deaths reported in each coroner jurisdiction in 2012 as a percentage of the population.
Map 1: Deaths reported to coroners as a percentage of the population, England and Wales, 2012 Over the last decade, the number of registered deaths has decreased from 535,356 in 2002 to 499,326(^3) in 2012; however the number has fluctuated in recent years. The number of deaths reported to coroners has stayed within the range of 222,371 and 234,784 over the last ten years, varying between 42 and 47 per cent of registered deaths (see Table 2 in the statistical tables).
(^3) Provisional figure based on ONS monthly death registration figures for 2012 Post-mortem examinations held and inquests opened
Post-mortem examinations were ordered by coroners in 42 per cent of all cases reported to them in 2012, a slight decrease compared to 2011, and continuing the existing downward trend (see Table 3). Over the last ten years the percentage of post-mortems ordered has decreased by ten percentage points from 117,684 to 94,814.
The actual number of deaths reported to coroners in 2012 where a post-mortem was held was 94,814, some 860 more than in the previous year, reflecting in part the increase in the total number of reported deaths.
Map 2: Post-mortems as a proportion of deaths reported to coroners, England and Wales, 2012
Legend
- Less than 30 per cent
- 30 to 50 per cent
- Greater than 50 per cent
Average = 42% Inquests were opened on 32,542 deaths reported to coroners in 2012, an increase of 1,561 on 2011. Inquest cases represented 14 per cent of all the deaths reported to coroners in 2012, a small increase, and continuing a long-term rising trend. Over the last ten years the percentage of inquest cases has increased by three percentage points.
Map 3: Inquests held as a proportion of deaths reported to coroners, England and Wales, 2012
Legend
- Less than 10 per cent
- 10 to 15 per cent
- 15 to 20 per cent
- Greater than 20 per cent
Average = 14% Post-mortems in inquest cases When an inquest is held a post-mortem examination has usually been conducted, and in 2012 post-mortems were conducted in 87 per cent of such cases. This is a lower proportion than in the previous year by one percentage point, and continues a shallow declining trend over the past decade. Prior to the late 1990s, the holding of an inquest without a post-mortem examination was comparatively rare, accounting for around two per cent or less of inquest cases every year. In 2012 there were 4,263 inquests without a post-mortem representing 13 per cent of inquests, this is over three times the number reported ten years ago.
Post-mortems in non-inquest cases In the majority (86 per cent) of cases referred to coroners there is no inquest. In 2012, there were 66,535 non-inquest cases where a post-mortem was held, and the percentage of non-inquest cases that required a post-mortem fell to 34 per cent. This proportion has fallen steadily in recent years; in 2002 it was 47 per cent of all non-inquest cases.
Cases requiring neither an inquest nor a post-mortem There were also 128,578 cases reported to coroners where there was neither an inquest nor a post-mortem. This particular category of case has generally been increasing in number in recent years (in 2002 there were 106,248 such cases). In addition, the percentage of cases where there was neither an inquest nor a post-mortem examination has increased, as a proportion of all deaths reported to coroners, from around 47 per cent in 2002, to 56 per cent in 2012.
Post-mortem rates, histology(^4) and toxicology(^5) Post-mortems can be classed as either standard or non-standard, depending on the cost of the examination. A non-standard post-mortem is charged at a higher rate than a standard post-mortem and is defined as a post-mortem which requires special skills. A non-standard post-mortem could, for example, require a paediatric or specialist pathologist. In 2012, 95 per cent of post-mortems were ordered at a standard rate, a slight decrease compared to 96 per cent in 2011 (see Table 4).
In 2012, 18,700 post-mortems included histology (20 per cent of post-mortems held), which was 750 more than in 2011, an increase of one percentage point. 12,613 post-mortems held in 2012 included toxicology (13 per cent of post-mortems held), the same percentage as in 2011.
(^4) Histology in the context of post-mortems is the examination of tissues under a microscope.
(^5) Toxicology in the context of post-mortems is the study of body fluids and tissues for the detection of drugs. Out of England Orders
Every person who wishes to remove a body of a deceased person out of England and Wales must give notice of such intention to the coroner within whose jurisdiction the body is lying. When the coroner gives permission for the removal of the body an Out of England order is issued.
Coroners issued 5,030 Out of England orders in 2012, compared with 5,008 issued in 2011. In both years the number of orders issued represented just over two per cent of the total number of deaths reported to coroners (see Table 5).
Of the 227,721 deaths reported to coroners in 2012, some 1,766 (less than one per cent) were reports of deaths that had occurred outside England and Wales, the same percentage reported in 2011.
Deaths in Custody
In 2012 a total of 281 deaths were reported to coroners which occurred in state custody(^6), less than one per cent of the total number of deaths reported. The highest number (152 or 54 per cent of the total) occurred in Prison custody, followed by 93 (33 per cent) in Mental Health Act detention centres (see Table 6).
(^6) This data only represents deaths in custody which were referred to a coroner. Inquest verdicts returned
Verdicts were returned at 30,123 inquests in 2012, which was 265 more than in 2011. As in previous years the most common verdicts in 2012 were death from natural causes (8,849, or 29 per cent), and death by accident or misadventure (7,705, or 26 per cent). Unclassified verdicts, which include narrative verdicts, represented 15 per cent of the total, and verdicts of suicide comprised 12 per cent in 2012 (see Tables 7 and 9). Map 4 shows the percentage of suicide verdicts in each coroner district.
Map 4: Suicide verdicts as a proportion of all inquest verdicts, England and Wales, 2012
In 2010, verdicts of death from natural causes for the first time became the most frequently recorded. This category was again the most frequent in 2011 and 2012. Unclassified verdicts saw the largest rise in terms of numbers; an increase of 234 (five per cent) from 4,400 in 2011 to 4,634 in 2012. Because of the overall rise in the number of verdicts returned, there were rises in several categories.
There were decreases in the numbers of verdicts in a few categories over the past year, which included a 34 per cent drop in verdicts of homicide (Killed lawfully or Killed unlawfully), from 237 to 158. The number of verdicts of
______________________________________________________________________
7 For information on criminal convictions of homicide please refer to the Criminal Justice System Statistics publication, available at www.gov.uk/government/organisations/ministry-of-justice/series/criminal-justice-statistics death from non-dependent abuse of drugs dropped by 27 per cent (down from 188 to 138), however this is effectively cancelled out by the 23 per cent increase in verdicts of death from dependence on drugs (up from 215 to 265).
**Figure 4: Verdicts returned at inquest, by category, England and Wales, 2012**
The rise in unclassified verdicts is due to the increasing use of what are known as 'narrative verdicts' by some coroners (see the paragraph on trends, below). A narrative verdict is where, instead of a conventional verdict, at the end of the inquest the coroner records a factual record of how and in what circumstances the death occurred. As well as narrative verdicts, this category also includes short non-standard verdicts which a coroner or jury might return when the circumstances do not easily fit any of the standard verdicts. Please see Annex A for further analysis of narrative verdicts.
Verdicts of death from natural causes are tending to rise steadily, and there is also a steady and steeper rise in the number of unclassified, including narrative, verdicts. There is a long-term slight downward trend in the numbers of verdicts of suicide, though there are fluctuations within that trend, and a more definite downward trend in the number of verdicts of accidental death.
As a proportion of verdicts delivered by coroners during a calendar year, there are four main trends, two rising, and two falling:
- verdicts of death from natural causes have risen steadily from 19 per cent in 2002 to more than 29 per cent in 2012; • unclassified verdicts (which include narrative verdicts, as explained above) formed two per cent of the total in 2002, but have since risen steadily to account for over 15 per cent of verdicts in 2012;
• verdicts of death by accident or misadventure have been declining steadily, from 40 per cent of verdicts in 2002 to 26 per cent in 2012;
• open verdicts have been declining over the same period, particularly over the last few years, they accounted for just under seven per cent of the total in 2012 compared with ten per cent in 2002.
Figure 5: Number of verdicts returned at inquests, England and Wales, 2002-2012
\*Differences in verdicts by sex
The pattern of verdicts differs between males and females. Male deaths accounted for about 67 per cent of all verdicts returned in 2012, however they accounted for 53 per cent of deaths reported; suggesting males are more likely to die in circumstances that lead to an inquest. Female deaths accounted for about 33 per cent of all verdicts returned in 2012 (and 47 per cent of deaths reported).
• Of the 3,515 verdicts of suicide, 79 per cent were for males and 21 per cent for females • Of the 2,059 open verdicts, 71 per cent were for males and 29 per cent for females, and
• 36 per cent of the 8,849 verdicts of death from natural causes were for females, the remaining 64 per cent were for males.
Figure 6: Verdicts returned at inquests by sex, England and Wales, 2012 Age of deceased in inquests where a verdict was returned
Since 2008, coroners have been asked to provide information (in summary form) on the ages of persons whose deaths proceeded to inquest and a verdict returned during the year. Of the inquests completed in 2012, 48 per cent were on persons who were aged 65 years or over at death. Less than eight per cent of inquests concluded were into deaths of persons aged under 25 (see Table 8).
Figure 7: Age of deceased in inquests where a verdict was returned, England and Wales, 2012
Inquests with juries, and adjourned inquests
Nearly all inquests concluded in 2012, as in other years, were held without juries. The number of inquests held with juries in 2012 was 472 (representing just two per cent of all inquests), and a decrease of 10 compared to 2011. Both the number and proportion of inquests held with juries showed a downward trend until recent years but the trend appears now to have halted, with the proportion remaining around two per cent for the last five years. Nevertheless, the proportion of inquests held with juries has fallen from three per cent of inquests concluded in 2002, to two per cent in 2012 (see Table 10).
Some 943 inquests (representing three per cent of all inquests concluded) were adjourned by the coroner under Section 16 of the Coroners Act 1988 because criminal proceedings took place, and subsequently were not resumed. This level is comparable to that generally prevailing in recent years.
______________________________________________________________________
8 Section 16 of the Coroners Act 1988 states that the coroner should adjourn an inquest in the event of criminal proceedings. Time taken to process an inquest
The estimated(^9) average time taken to process an inquest in 2012 (defined as being from the time the death was reported until the conclusion of the inquest) was 26 weeks to the nearest whole week (see Table 10).
The average time taken has slightly increased since the present system of estimating this average was introduced in 2004, when it was 22 weeks, although it has decreased slightly from the 2011 average of 27 weeks. Only deaths occurring within England and Wales are included in this estimation. More information about how the average time has been estimated can be found in the Explanatory Notes section.
The maximum time taken to process an inquest in 2012 was 53 weeks, and the minimum time was eight weeks. The time taken has a relatively large range of 45 weeks, which could be due to the fact that coroners’ caseloads can vary greatly and a direct comparison is therefore not advised.
Map 5: Average time taken to process inquests, England and Wales, 2012
(^9) A direct average of the time taken to process an inquest cannot be calculated from the data collected; an estimate has been made instead. Please see Explanatory Notes for more information. Treasure and Treasure Trove
On 24 September 1997, the Treasure Act 1996 came into force and replaced the common law of Treasure Trove in England and Wales. The 1996 Act introduced new requirements for reporting and dealing with finds. Not all finds need be the subject of an inquest. For more information please see;
www.legislation.gov.uk/ukpga/1996/24/contents
In 2012, 750 finds were reported and 355 inquests were concluded, from which a verdict declaring a find to be treasure was returned in 337 cases (see Table 11). There were two inquests held into Treasure Trove in 2012 (relating to finds made before the current Act came into force), and it is likely that a few such inquests will continue to be held from time to time.
The number of finds reported has been steadily increasing over the last ten years, although in 2012 there was a slight decrease of six per cent compared to 2011.
The number of verdicts of treasure in 2012 was exactly the same as the number recorded in 2011 (337), however the proportion of treasure inquests which resulted in a verdict of treasure increased slightly, from 93 per cent in 2011 to 95 per cent in 2012.
An annual report on the operation of the Treasure Act 1996 is published by the Department for Culture, Media and Sport. For more information please see:
www.gov.uk/government/organisations/department-for-culture-media-sport/series/treasure-and-portable-antiquities-statistics Figure 8: Finds reported to coroners and inquests held under the Treasure Act, 2002-2012
Map 6: Number of treasure finds reported to coroners, England and Wales, 2012
Legend
- None
- Between 1 and 6
- Between 6 and 10
- Greater than 10
Average = 7 Map 7 Coroner districts in England and Wales, 2012
Key to jurisdictions
**North East**
- 101 – Darlington and South Durham
- 102 – North Durham
- 103 – Hartlepool
- 104 – North Northumberland
- 105 – South Northumberland
- 106 – Teesside
- 107 – Gateshead and South Tyneside
- 108 – Newcastle upon Tyne
**North West**
- 109 – North Tyneside
- 110 – Sunderland
- 201 – Cheshire
- 203 – South and East Cumbria
- 204 – North and West Cumbria
- 205 – Manchester (city)
- 206 – Manchester North | Region | Districts | |-------------------------------|---------------------------------------------------------------------------| | North West (continued) | 207 – Manchester South\
208 – Manchester West\
209 – Blackburn, Hyndburn and Ribble Valley\
210 – Blackpool and Fylde\
211 – East Lancashire\
212 – Preston and West Lancashire\
213 – Sefton, Knowsley and St Helens\
214 – Liverpool\
215 – Wirral | | Yorkshire and the Humber | 301 – East Riding and Hull\
302 – North Lincolnshire and Grimsby\
303 – York City\
304 – North Yorkshire - East\
305 – North Yorkshire - West\
306 – South Yorkshire - East\
307 – South Yorkshire - West\
308 – West Yorkshire - East\
309 – West Yorkshire - West | | East Midlands | 401 – Derby and South Derbyshire\
402 – North Derbyshire\
403 – Leicester and South Leicestershire\
404 – North Leicestershire and Rutland\
406 – Central Lincolnshire\
408 – South Lincolnshire\
409 – Northamptonshire\
410 – Nottinghamshire | | West Midlands | 501 – Herefordshire\
502 – North Shropshire\
503 – South Shropshire\
504 – Staffordshire South\
505 – Stoke-on-Trent and North Staffordshire\
506 – Telford and Wrekin\
507 – Warwickshire\
508 – Birmingham and Solihull\
509 – Black Country\
510 – Coventry\
512 – Worcestershire | | East of England | 601 – Bedfordshire and Luton\
602 – North and East Cambridgeshire\
603 – South and West Cambridgeshire\
604 – Essex and Thurrock\
605 – Hertfordshire\
607 – Norfolk\
609 – Peterborough\
610 – Southend on Sea\
611 – Suffolk | | London | 701 – City of London [not visible]\
702 – East London\
703 – Inner London North\
704 – Inner London South\
705 – Inner London West\
706 – North London\
707 – South London\
708 – West London | | South East | 801 – Berkshire\
802 – Brighton and Hove\
803 – Buckinghamshire\
804 – East Sussex\
805 – Central Hampshire\
806 – North East Hampshire\
807 – Portsmouth and South East Hampshire\
808 – Southampton and New Forest\
809 – Isle of Wight\
810 – Central and South East Kent\
811 – Mid Kent and Medway\
812 – North East Kent\
813 – North West Kent\
814 – Milton Keynes\
815 – Oxfordshire\
816 – Surrey\
817 – West Sussex | | South West | 901 – Avon\
902 – Cornwall\
903 – Exeter and Greater Devon\
904 – Plymouth and South West Devon\
905 – Torbay and South Devon\
906 – Bournemouth and Eastern Dorset\
907 – Western Dorset\
908 – Gloucestershire\
909 – Isles of Scilly\
910 – Eastern Somerset\
911 – Western Somerset\
912 – Wiltshire and Swindon | | Wales | 1001 – Bridgend and Glamorgan Valleys\
1002 – Cardiff and Vale of Glamorgan\
1003 – Carmarthenshire\
1004 – Central North Wales\
1005 – Ceredigion\
1006 – Gwent\
1007 – Neath and Port Talbot\
1008 – North East Wales\
1009 – North West Wales\
1010 – Pembrokeshire\
1011 – Powys\
1012 – City and County of Swansea | Annex A: Analysis of Unclassified verdicts
Summary
This research aims at unpacking the reasons behind the rise of 1,477 in the “Unclassified verdicts” category over the last five years. To investigate this increase we asked two independent assessors to analyse a random sample of 2,196 “Unclassified verdicts” recorded between 2007 and 2011.
The analysis shows that there is scope for introducing a new short-form category: “Medical or surgical intervention unsuccessful”. This category accounts for around 25 per cent of the total (varying between 17 and 33 per cent).
The analysis also shows a substantial agreement between the two independent assessors (Kappa coefficient of 0.61). However, there could be tighter guidance on the definition of which verdicts belong to each short-form category – there was some disagreement on whether some verdicts were correctly classified.
The paper also explored the hypothesis that suicide verdicts are ‘hidden’ within the “Unclassified verdicts” category. The analysis showed that the overall percentage of “Could indicate suicide” verdicts within the “Unclassified verdicts” category is around six per cent.
Introduction
Coroners in England and Wales are required to submit at the end of each calendar year a statistical return to the MoJ, which includes the number of inquest verdicts returned, broken down by category of verdict. In addition to the fourteen short-form categories there is a category for “Unclassified verdicts”, which includes narrative verdicts. Narrative verdicts are where, at the end of the inquest instead of a conventional short-form verdict the coroner records a factual description of how and in what circumstances the death occurred.
Coroners are requested to provide details of all “Unclassified verdicts” they have recorded on a supplementary sheet as part of their annual return; however this is not always provided, or is sometimes not provided in sufficient detail to explain the cause of death.
10 The current short-form categories are: Killed unlawfully; Killed lawfully; Suicide; Attempted or self-induced abortion; Cause of death aggravated by lack of care, or self-neglect; Dependence on drugs; Non-dependent abuse of drugs; Want of attention at birth; Deaths from industrial diseases; Deaths by accident or misadventure; Stillborn; Deaths from natural causes; Open verdicts; Disasters. Since 2000, the number and percentage of “Unclassified verdicts” returned at inquests has been steadily increasing (see Figure A1). In the last five years the number has increased from 2,923 in 2007 (11 per cent of total verdicts) to 4,400 in 2011 (15 per cent of total verdicts).
Figure A1: “Unclassified verdicts” as a percentage of all verdicts returned at inquests, England and Wales, 1995-2012
Recent case law could be responsible for this increase in narrative verdicts, in particular the House of Lords judgement in R v HM Coroner for West Somerset ex parte Middleton in 2004, which encouraged their use.(^{11})
Coroners are unable to record a short-form verdict of suicide unless they are convinced beyond any reasonable doubt that the deceased intended to take his/her own life. This has caused concerns regarding the number of suicides which could potentially be ‘hidden’ in the “Unclassified verdicts” category.
In 2011 the Office for National Statistics published a study entitled ‘Narrative verdicts and their impact on mortality statistics in England and Wales’. The study was conducted as the ONS was ‘concerned about the impact of narrative verdicts on the quality of statistics on cause of death’(^{12}). They concluded that:
(^{11}) The Middleton case suggested that a narrative verdict could be used instead of a short-form verdict, in order to provide information on the circumstances surrounding the death. The judgement can be found at the following link: [www.publications.parliament.uk/pa/ld200304/ldjudgmt/jd040311/midd-1.htm](http://www.publications.parliament.uk/pa/ld200304/ldjudgmt/jd040311/midd-1.htm)
(^{12}) ‘Narrative verdicts and their impact on mortality statistics in England and Wales’ in Health Statistics Quarterly 49, Spring 2011 (ONS) The increase in the use of narrative verdicts by coroners has not had a statistically significant impact on published suicide rates in England and Wales... A recommendation has been made to coroners to consider ways of recording narrative verdicts to allow more accurate coding of cause of death.\\textsuperscript{13}
Following on from the Office for National Statistics’ study, we conducted this analysis for the period 2007 – 2011 in order to examine what verdicts are actually included in the “Unclassified verdicts” category, and whether, based on the findings, there is any scope for new guidance or changing the short-form categories.
**Methodology**
We asked two independent assessors (in this case two retired coroners) to analyse a sample taken from the “Unclassified verdicts” category, for the years 2007 – 2011. The sample was determined using stratified sampling across all coroner districts. The size was determined to be around ten per cent of all “Unclassified verdicts” and it aimed at providing 95 per cent confidence intervals of around six percentage points width. This means that the size was around 450 verdicts each year.
To obtain our sample we randomly selected verdicts from the “Unclassified verdicts” list provided by each coroner district\\textsuperscript{14}. The sample verdicts were then categorised independently by the assessors into one of six groups:
1. Could indicate suicide – i.e. a verdict which implies the deceased took his/her own life
2. Indicates alcohol abuse (with or without other factors)
3. Medical or surgical intervention unsuccessful
4. Error – verdict should be in one of the existing short-form categories (in this case the assessor was asked to provide a description of which category the verdict should, in his opinion, be placed in)
5. Correct – verdict could not be in any other category
6. Unknown – insufficient data is provided to determine cause of death
The first category was chosen due to the existing hypothesis that suicide verdicts are ‘hidden’ within the “Unclassified verdicts” category.
\\textsuperscript{13} ‘Narrative verdicts and their impact on mortality statistics in England and Wales’ in Health Statistics Quarterly 49, Spring 2011 (ONS)
\\textsuperscript{14} Samples were taken from each coroner district which had a total number of “Unclassified verdicts” greater than or equal to five The second and third categories were chosen as these are recurring themes within the “Unclassified verdicts” category for which no relevant short-form verdict currently exists.
The “Error” category was used to capture any verdicts which were incorrectly placed in the “Unclassified verdicts” category, while the “Correct” and “Unknown” groups captured the remainder; respectively those which could not be placed elsewhere and those where the data was missing or incomplete.
The categorisation of verdicts completed by the independent assessors was based on their own individual opinions; it is therefore important to note the subjectivity of this analysis.
Once the data had been analysed by the assessors we collated the data for each year and calculated 95 per cent confidence intervals for each category (see Tables A2a and A2b). The 95 per cent confidence intervals were based on the exact binomial distribution and, therefore, are not symmetric.
To measure the agreement between the two assessors the Kappa coefficient was used. This coefficient is a measure of inter-rater agreement particularly suited for categorical items such as the six groups. It is commonly understood that Kappa coefficient values less than zero indicate no agreement, between zero and 0.2 as slight agreement, between 0.21 and 0.40 as fair agreement, between 0.41 and 0.60 as moderate agreement, between 0.61 and 0.80 as substantial agreement, and between 0.81 and 1 as almost perfect agreement15.
Results
Overall, across the 2,196 verdicts, the results showed an agreement between the two assessors using the Kappa Statistic Test (see Table A1), indicated by a Kappa coefficient value of 0.61 (95 per cent confidence interval between 0.59 and 0.63).
Table A1: Agreement between the two assessors
| Category | Correct | Could indicate suicide | Error | Indicates alcohol abuse | Medical or surgical intervention unsuccessful | Unknown | |---------------------------------------|---------|------------------------|-------|-------------------------|-----------------------------------------------|---------| | Correct | 2 | 0 | 36 | 0 | 2 | 4 | | Could indicate suicide | 5 | 96 | 39 | 0 | 1 | 2 | | Error | 291 | 12 | 50 | 6 | 117 | 87 | | Indicates alcohol abuse | 2 | 2 | 0 | 113 | 0 | 1 | | Medical or surgical intervention unsuccessful | 16 | 1 | 0 | 7 | 463 | 10 | | Unknown | 8 | 0 | 1 | 0 | 3 | 819 |
15 Landis, J.R.; & Koch, G.G. (1977). "The measurement of observer agreement for categorical data". Biometrics 33 (1): 159–174. In 2011, the category containing the highest number of sample verdicts was “Unknown” (40 per cent according to Coroner 1, 48 per cent according to Coroner 2). This category has consistently had the highest number of sample verdicts since 2007 (see Tables A2a and A2b).
The percentage of verdicts in “Could indicate suicide” in 2011 was between five per cent (Coroner 1) and six per cent (Coroner 2). This percentage has been fairly stable since 2007, fluctuating between five and eight per cent of the total. The percentage is relatively low, which corresponds with the findings from the ONS study on narrative verdicts.
Between 2007 and 2009 the number of verdicts in the “Indicates alcohol abuse” category decreased, however since 2009 this number has been increasing.
The “Medical or surgical intervention unsuccessful” category represented between 22 per cent of sample verdicts in 2011 (Coroner 1) and 23 per cent (Coroner 2). The number in this category has fluctuated since 2007, although there was an increase of between three (Coroner 2) and five (Coroner 1) percentage points from 2010 to 2011.
Figure A2: Classification of “Unclassified verdicts” returned at inquests, England and Wales, 2007-2011
There was a large difference between the number of verdicts classified as “Error” by the two assessors. Coroner 1 recorded 25 per cent of verdicts in this category in 2011, compared to only seven per cent recorded by Coroner 2. This highlights the subjective nature of the analysis.
The analysis performed by Coroner 1 showed 66 per cent of verdicts within the “Error” category were classed as ‘Accident/ Misadventure’, looking at the period 2007 – 2011 as a whole (see Table A4a). The next most common error was 'Natural Causes', which accounted for 16 per cent of error verdicts across the period.
The analysis completed by Coroner 2 placed 31 per cent of “Error” verdicts within the ‘Suicide’ category, followed by 17 per cent allocated to ‘Accident/Misadventure’ (see Table A4b).
### Table A2a: Classification of “Unclassified verdicts” sample by Coroner 1, with 95 per cent confidence intervals, 2007-2011
| Unclassified verdicts | 2011 Mean | 2011 C.I. | 2010 Mean | 2010 C.I. | 2009 Mean | 2009 C.I. | 2008 Mean | 2008 C.I. | 2007 Mean | 2007 C.I. | |----------------------------------------------------|-----------|-----------|-----------|-----------|-----------|-----------|-----------|-----------|-----------|-----------| | Correct | 2% (1% - 4%) | 2% (1% - 4%) | 3% (1% - 4%) | 2% (1% - 4%) | 1% (0% - 3%) | | Could indicate suicide | 5% (3% - 7%) | 7% (5% - 10%) | 8% (6% - 11%) | 6% (4% - 9%) | 6% (4% - 9%) | | Error | 25% (21% - 30%) | 28% (23% - 32%) | 23% (19% - 27%) | 25% (21% - 29%) | 27% (23% - 32%) | | Indicates alcohol abuse | 6% (4% - 8%) | 4% (3% - 7%) | 3% (2% - 6%) | 6% (4% - 9%) | 8% (5% - 11%) | | Medical or surgical intervention unsuccessful | 22% (18% - 26%) | 17% (14% - 21%) | 23% (19% - 27%) | 28% (24% - 33%) | 24% (20% - 28%) | | Unknown | 40% (35% - 45%) | 42% (37% - 46%) | 40% (36% - 45%) | 33% (29% - 38%) | 34% (30% - 39%) | | n | 444 | 438 | 440 | 435 | 439 |
### Table A2b: Classification of “Unclassified verdicts” sample by Coroner 2, with 95 per cent confidence intervals, 2007-2011
| Unclassified verdicts | 2011 Mean | 2011 C.I. | 2010 Mean | 2010 C.I. | 2009 Mean | 2009 C.I. | 2008 Mean | 2008 C.I. | 2007 Mean | 2007 C.I. | |----------------------------------------------------|-----------|-----------|-----------|-----------|-----------|-----------|-----------|-----------|-----------|-----------| | Correct | 12% (9% - 15%) | 21% (17% - 25%) | 12% (9% - 16%) | 14% (11% - 18%) | 15% (11% - 18%) | | Could indicate suicide | 6% (4% - 8%) | 5% (4% - 8%) | 5% (3% - 7%) | 5% (3% - 7%) | 5% (3% - 7%) | | Error | 7% (4% - 9%) | 6% (4% - 9%) | 5% (3% - 7%) | 6% (4% - 9%) | 5% (3% - 7%) | | Indicates alcohol abuse | 6% (4% - 8%) | 5% (3% - 7%) | 4% (2% - 6%) | 6% (4% - 8%) | 9% (6% - 12%) | | Medical or surgical intervention unsuccessful | 23% (19% - 27%) | 20% (17% - 24%) | 28% (24% - 33%) | 33% (28% - 37%) | 30% (26% - 34%) | | Unknown | 48% (43% - 53%) | 42% (37% - 47%) | 45% (41% - 50%) | 37% (32% - 42%) | 38% (33% - 43%) | | n | 444 | 438 | 440 | 435 | 439 |
### Table A3: Overall average for each category over the period 2007-2011
| Category | Average for Coroner 1 | Average for Coroner 2 | Overall average | |-----------------------------------------------|-----------------------|-----------------------|-----------------| | Correct | 2% | 15% | 8% | | Could indicate suicide | 7% | 5% | 6% | | Error | 26% | 6% | 16% | | Indicates alcohol abuse | 5% | 6% | 6% | | Medical or surgical intervention unsuccessful | 23% | 27% | 25% | | Unknown | 38% | 42% | 40% |
**Notes**
The average for "Medical or surgical intervention unsuccessful" for Coroner 1, for example, is calculated by averaging the five percentages recorded in this category for the years 2007 - 2011 (see Table A2a).
The Overall average in the third column of this table is calculated by averaging the averages for Coroner 1 and Coroner 2.
### Table A4a: Error breakdown for Coroner 1, 2007-2011
| Type of error | 2011 Number | 2011 Percentage | 2010 Number | 2010 Percentage | 2009 Number | 2009 Percentage | 2008 Number | 2008 Percentage | 2007 Number | 2007 Percentage | Totals Number | Totals Percentage | |----------------------------------------------------|-------------|-----------------|-------------|-----------------|-------------|-----------------|-------------|-----------------|-------------|-----------------|---------------|------------------| | Death aggravated by neglect or self neglect | 1 | 1% | 0 | 0% | 0 | 0% | 1 | 1% | 0 | 0% | 2 | 0% | | Deaths by accident (including misadventure) | 71 | 63% | 70 | 58% | 58 | 57% | 83 | 78% | 88 | 73% | 370 | 66% | | Deaths from industrial diseases | 11 | 10% | 15 | 12% | 15 | 15% | 10 | 9% | 8 | 7% | 59 | 10% | | Deaths from natural causes | 20 | 18% | 25 | 21% | 19 | 19% | 7 | 7% | 20 | 17% | 91 | 16% | | Dependence on drugs | 1 | 1% | 0 | 0% | 0 | 0% | 0 | 0% | 0 | 0% | 1 | 0% | | Drug abuse | 0 | 0% | 0 | 0% | 0 | 0% | 0 | 0% | 0 | 0% | 0 | 0% | | Inquest adjourned | 0 | 0% | 0 | 0% | 0 | 0% | 0 | 0% | 0 | 0% | 0 | 0% | | Killed lawfully/ unlawfully | 2 | 2% | 2 | 2% | 6 | 6% | 3 | 3% | 1 | 1% | 14 | 2% | | Non-dependent abuse of drugs | 0 | 0% | 0 | 0% | 0 | 0% | 0 | 0% | 0 | 0% | 0 | 0% | | Not classified | 1 | 1% | 1 | 1% | 0 | 0% | 1 | 1% | 0 | 0% | 3 | 1% | | Open verdicts | 6 | 5% | 8 | 7% | 4 | 4% | 2 | 2% | 3 | 3% | 23 | 4% | | Suicide | 0 | 0% | 0 | 0% | 0 | 0% | 0 | 0% | 0 | 0% | 0 | 0% | | Total | 113 | 100% | 121 | 100% | 102 | 100% | 107 | 100% | 120 | 100% | 563 | 100% |
### Table A4b: Error breakdown for Coroner 2, 2007-2011
| Type of error | 2011 Number | 2011 Percentage | 2010 Number | 2010 Percentage | 2009 Number | 2009 Percentage | 2008 Number | 2008 Percentage | 2007 Number | 2007 Percentage | Totals Number | Totals Percentage | |----------------------------------------------------|-------------|-----------------|-------------|-----------------|-------------|-----------------|-------------|-----------------|-------------|-----------------|---------------|------------------| | Death aggravated by neglect or self neglect | 0 | 0% | 0 | 0% | 0 | 0% | 0 | 0% | 1 | 5% | 1 | 1% | | Deaths by accident (including misadventure) | 12 | 41% | 7 | 25% | 1 | 5% | 1 | 4% | 0 | 0% | 21 | 17% | | Deaths from industrial diseases | 4 | 14% | 3 | 11% | 7 | 32% | 2 | 7% | 1 | 5% | 17 | 13% | | Deaths from natural causes | 4 | 14% | 2 | 7% | 2 | 9% | 1 | 4% | 4 | 20% | 13 | 10% | | Dependence on drugs | 0 | 0% | 3 | 11% | 0 | 0% | 1 | 4% | 3 | 15% | 7 | 6% | | Drug abuse | 2 | 7% | 0 | 0% | 0 | 0% | 0 | 0% | 0 | 0% | 2 | 2% | | Inquest adjourned | 0 | 0% | 0 | 0% | 0 | 0% | 1 | 4% | 1 | 5% | 2 | 2% | | Killed lawfully/ unlawfully | 1 | 3% | 1 | 4% | 1 | 5% | 2 | 7% | 0 | 0% | 5 | 4% | | Non-dependent abuse of drugs | 2 | 7% | 0 | 0% | 0 | 0% | 5 | 19% | 0 | 0% | 7 | 6% | | Not classified | 0 | 0% | 0 | 0% | 0 | 0% | 0 | 0% | 3 | 15% | 4 | 3% | | Open verdicts | 2 | 7% | 2 | 7% | 1 | 5% | 3 | 11% | 0 | 0% | 8 | 6% | | Suicide | 2 | 7% | 9 | 32% | 10 | 45% | 11 | 41% | 7 | 35% | 39 | 31% | | Total | 29 | 100% | 28 | 100% | 22 | 100% | 27 | 100% | 20 | 100% | 126 | 100% | Explanatory notes
The United Kingdom Statistics Authority has designated these statistics as National Statistics, in accordance with the Statistics and Registration Service Act 2007 and signifying compliance with the Code of Practice for Official Statistics.
Designation can be broadly interpreted to mean that the statistics:
- meet identified user needs;
- are well explained and readily accessible;
- are produced according to sound methods, and
- are managed impartially and objectively in the public interest.
Once statistics have been designated as National Statistics it is a statutory requirement that the Code of Practice shall continue to be observed.
The data analysed in this publication are based on annual returns from H.M. Coroners. Coroners are required under the provisions of Section 28 of the Coroners Act 1988 to furnish to the Secretary of State returns in relation to inquests held and deaths inquired into by him (or her) in such form and containing such particulars as the Secretary of State may direct. Thanks are due to coroners and their staff for their work in preparing these returns.
Quality and consistency of the statistics
The figures presented in this report are collected via statistical returns completed by coroners. For the calendar year 2012, returns were received from all 111 coroner districts. The process by which coroners provide their returns can vary according to the case management system they use. Many coroners (90 per cent) use a system provided by an external contractor, while other coroners use alternative computer systems or a paper-based system. Although care is taken in completing, analysing and quality-assuring the data provided on the statistical returns, the figures are, of necessity, subject to possible inaccuracies inherent in any large-scale collection of this type. For this reason, figures may not be accurate to the final digit. Every effort is made, however, to ensure that the figures presented in this publication are accurate and complete.
Returns are individually quality-assured and validated in a process that highlights inconsistencies between years, and other areas. Checks are made to ensure that each return is arithmetically correct, including with subtotals and grand totals correctly summed. Unusual values encountered in a return are queried with the data supplier, to confirm whether these are correct, or an error in the information provided which requires amendment.
Coroners are independent office-holders, and there is considerable variation in the way each coroner’s district is structured and managed, and in the mechanisms they have in place for discharging their duties under the Coroners Act. From a statistical perspective one of these differences relates to the way they approach the handling of “NFA” cases.
Many deaths referred to coroners require no further action being taken by them – these are known as “NFA” cases. These are deaths reported to coroners where there was no inquest, no post-mortem, and no certificate was issued by the coroner for registration or any other purpose. The statistics for 1995 onwards include all NFA cases within the figures for deaths reported that required neither an inquest nor a post-mortem. Prior to 1995, however, some coroners did not report some or all of their NFA cases in their annual statistics (figures for some earlier years are shown in Table 2), and the inclusion of all NFA cases in the statistics addressed this inconsistency in reporting.
Despite the inclusion of all NFA cases in the statistics since 1995 however, there may still be some differences between coroners as to which cases they consider constitute a substantive “reported death” (and are therefore reported in their statistics) where little or no action is required on their part and no post-mortem or inquest is held. As such, the statistics reflect those cases which each individual coroner considers to be a death reported to them, and the figures for different coroner districts can be compared on this basis.
Users of the statistics The main users of these statistics are coroners themselves, and Ministers and officials in central government responsible for developing policy with regard to coroners. Other users include the Chief Coroner’s Office, local authorities (who are responsible for the appointment and remuneration of coroners), other central government departments, and those non-governmental bodies, including various voluntary organisations, with an interest in coroners and inquests. The statistics are used to monitor the volume and types of cases dealt with by coroners in England and Wales each year.
Revisions to statistics for previous years The estimated figure for the number of registered deaths in 2011 which was derived for the purposes of Table 2 in last year’s edition of this bulletin has now been replaced by an actual figure subsequently published by the Office for National Statistics.
Symbols and conventions The following symbols have been used throughout the tables in this bulletin:
n/a = Not applicable
- = Nil .. = Not available
* = Number or percentage not shown due to being based on small numbers of cases
(R) = Revised data
Maps The maps used in this publication are experimental and any feedback would be welcomed. The categories used in each map have been created using appropriate bandwidths.
Further notes Prior to 1 June 2005, policy responsibility for H.M. Coroners lay with the Home Office, but on that date it passed to the Department for Constitutional Affairs as part of machinery of government changes following the 2005 general election. Responsibility now lies with the Ministry of Justice, which was created on 9 May 2007.
Prior to the transfer of responsibility, the Home Office published statistical bulletins based on coroners' annual returns, from 1980. The last four bulletins published in the Home Office Statistical Bulletin series were as follows: for year 2003, bulletin 9/04; for 2002, bulletin 6/03; for 2001, bulletin 3/02; and for year 2000, bulletin 7/01. These may be found at:
webarchive.nationalarchives.gov.uk/20110218135832/http://rds.homeoffice.gov.uk/rds/hosbarchive.html
Editions of this bulletin for years up to and including 2009, published by the Ministry of Justice, the Department for Constitutional Affairs, and the Home Office, were entitled “Statistics on deaths reported to coroners, England and Wales, (year)”. Further information on deaths occurring annually in England and Wales is published by the Office for National Statistics in their Mortality Statistics series; these may be downloaded from their website at
www.statistics.gov.uk Glossary
The following brief definitions are intended as a guide to the meaning of terms in this bulletin concerning coroners and their work; more detailed definitions will be found in the Coroners Act 1988 and the Treasure Act 1996.
Coroner; deaths reported In England and Wales, all violent, unnatural or accidental deaths, deaths of unknown cause, deaths that might have been due to an industrial disease or related to the deceased's employment, and all deaths of persons in prison or police custody, are reported to coroners. Coroners are appointed by local authorities; they must be barristers, solicitors or registered medical practitioners and must have at least five years' standing in the relevant profession. The relevant legislation and guidance is contained within the Coroners Act 1988 and the Coroners Rules 1984 (S.I 1984/552 and subsequent amendments). A link to the Act is here:
www.legislation.gov.uk/ukpga/1988/13/contents
The more recent amendments to the Coroners Rules may be found at:
www.legislation.gov.uk/uksi?title=coroners%20rules
Non-inquest cases The coroner's investigation is concluded most often without an inquest being held. The coroner will have satisfied himself or herself, by means of a post-mortem examination or other investigation, on the physical cause of death, and that the death was not one on which he or she is required by law to hold an inquest.
Post mortem examinations A coroner may request that a post-mortem examination be conducted, whether or not an inquest is held, particularly if the cause of death is not clear. In many cases a post-mortem examination is conducted in order to determine whether or not an inquest is necessary. Other post-mortem examinations are held which are not ordered by the coroner. Details of these are collected by the Office for National Statistics (ONS). See the further information section below for details of how to obtain statistics on this and other related topics.
Out of England Orders Every person wanting to remove a body of a deceased person out of England and Wales must give notice of such intention to the coroner within whose jurisdiction the body is lying. This notice allows the coroner to consider whether an inquest or post-mortem is necessary before the coroner gives permission for the removal of the body. Inquests A coroner must hold an inquest if the body of a person ('the deceased') lies within his or her district and if he or she has reasonable cause to suspect that the deceased:
(a) died a violent or unnatural death;
(b) died a sudden death the cause of which is unknown; or
(c) died in prison or in such place or in such circumstances as to require an inquest under any other Act.
The holding of an inquest requires the coroner to determine:
(a) who the deceased was;
(b) how, when and where the deceased came by his or her death, and any further particulars necessary to enable the death to be registered.
Verdicts are returned in nearly all coroners' inquests. The exceptions are those inquests adjourned by the coroner which he or she later decides not to resume, and are mainly inquests into deaths by unlawful killing and deaths by dangerous driving or careless driving when under the influence of alcohol or drugs, in which court proceedings have been instituted. This avoids the need for two tribunals to consider the same evidence. A "narrative verdict" is where the coroner makes a brief and factual statement at the conclusion of the inquest but does not return one of the suggested short-form verdicts.
Timeliness of inquests For the purpose of determining the timeliness of inquests, the time taken to conduct an inquest is deemed to be from the day the death was reported to the coroner until either (a) the day the inquest is concluded by the delivery of a verdict or (b) the day the coroner certifies that an adjourned inquest will not be resumed.
The average time for an inquest to be conducted is estimated in the following way: Coroners are asked in their annual return to state how many inquests were concluded within certain time periods. There are five time bands, which are: within one month; 1-3 months; 3-6 months; 6-12 months; and over 12 months. All the inquests falling within a time-band are then assumed to have been completed at or near the mid-point of the various time-bands for the purposes of calculating the average, although inquests within the "under one month" band are assumed to have taken 3 weeks for this purpose of this estimation, and those inquests taking over a year to conclude were deemed to have taken 18 months, although the time-band itself is open-ended. Numbers are then aggregated and the average figure (in weeks) calculated in the normal way. Only deaths occurring within England and Wales are included in the calculation. Statistics are not collected on the time taken for inquests where the death occurred outside England and Wales. Deaths occurring abroad are often significantly delayed because of the difficulty, for example, of obtaining reports from other countries.
**Juries**
Nearly all inquests are held by a coroner sitting alone, without a jury. A jury must be summoned where the death occurred:
(a) in prison, or in such a place or such circumstances as to require an inquest under another Act;
(b) in police custody, or resulted from an injury caused by a police officer in the purported execution of his or her duty;
(c) where there are certain statutory reporting obligations under the Health and Safety Act 1974 or any other Act, and in certain other circumstances, especially where there may be a continuing or recurring danger to the public.
**Treasure and treasure trove**
In addition to inquiring into certain deaths, coroners also have jurisdiction to inquire into any treasure which is found in their districts and to establish who the finders were. With the commencement of the Treasure Act 1996 on 24 September 1997 inquests into finds which previously might have been declared treasure trove are supplemented by those now conducted to determine whether finds made on or after that date are treasure.
**Registered deaths**
All deaths in England and Wales must be registered with the Registrar of Births and Deaths. The term ‘registered deaths’ in this bulletin refers to deaths registered within a specific time period (in this case, calendar years).
Statistics on registered deaths in England and Wales are published by the ONS in their series on mortality statistics. At the time of going to press, final figures had not been published for the number of registered deaths in 2012, but a provisional figure has been derived from the monthly registration figures which are published by ONS at regular intervals. Contacts
Current and previous editions of this publication are available for download at www.gov.uk/government/organisations/ministry-of-justice/series/coroners-and-burials-statistics
The spreadsheet file of the statistical tables referred to in this bulletin is also available for download from this address.
Press enquiries should be directed to the Ministry of Justice press office:
Tel: 020 3334 3535
Email: [email protected]
Other enquiries about these statistics should be directed to:
Caroline Nauth-Misir
Ministry of Justice
7th Floor (7.20)
102 Petty France
London
SW1H 9AJ
Tel: 020 3334 3111
Email: [email protected]
A copy of the data collection form which was sent to coroners may be obtained via the contact details above.
General enquiries about the statistical work of the Ministry of Justice can be e-mailed to: [email protected]
Other National Statistics publications, and general information about the official statistics system of the UK, are available from www.statistics.gov.uk.
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445f3294bfa90caf9f301a8b554c2949c9bd5771 | Norfolk County Council Corporate Management Structure 01 May 2019
Staff in top three tiers earning over £50,000 per annum
**Tier One**
| Position | Name | Scale | Permanent, Full Time | Max Salary | Max Salary - £158,047 | |----------|------|-------|----------------------|------------|------------------------| | Head of Paid Service/Executive Director of Community & Environmental Services | Tom McCabe | S | Permanent, Full Time | £155,000 - £159,999 | £158,047 |
**Tier Two - Reporting to Head of Paid Service**
| Position | Name | Scale | Permanent, Full Time | Max Salary | Max Salary - £148,047 | |----------|------|-------|----------------------|------------|------------------------| | Executive Director of Adult Social Services | James Bullion | S | Permanent, Full Time | £145,000 - £149,999 | £148,047 | | Executive Director of Children’s Services | Sara Tough | S | Permanent, Full Time | £145,000 - £149,999 | £148,047 | | Executive Director of Finance & Commercial Services (Section 151 Officer) | Simon George | S | Permanent, Full Time | £145,000 - £149,999 | £148,047 | | Executive Director of Strategy and Governance | Fiona McDiarmid | R | Permanent, Full Time | £125,000 - £129,999 | £127,710 |
**Tier Three - Reporting to Executive Director of Adult Social Services**
| Position | Name | Scale | Permanent, Full Time | Max Salary | Max Salary - £110,160 | |----------|------|-------|----------------------|------------|------------------------| | Assistant Director Strategy & Transformation | | Q | Temporary, full time | Max Salary - £110,160 | £110,160 | | Director of Community Social Work | | Q | Permanent, Full Time | Max Salary - £110,160 | £110,160 | | Director of Commissioning | | Q | Interim, Part Time | Max Salary - £110,160 | £110,160 | | Head of Business Systems & Technology | | N | Permanent, Full Time | Max Salary - £62,397 | £62,397 | | Assistant Director Early Help and Prevention | | P | Permanent, Full Time | Max Salary - £96,933 | £96,933 |
### Tier Three - Reporting to Executive Director of Children’s Services
| Position | Scale | Salary Range | Employment Status | Max Salary | |--------------------------------------------------------------------------|-------|-----------------------|-------------------|------------------| | Assistant Director, Education | Q | £110,000 - £114,999 | Temporary, Full | £110,160 | | Assistant Director, Social Work | Q | £110,000 - £114,999 | Full Time | £110,160 | | Assistant Director Early Help and Prevention | P | £95,000 - £99,999 | Full Time | £96,933 | | Assistant Director Performance Planning and Quality Assurance | P | £95,000 - £99,999 | Full Time | £96,933 | | Business Design & Change Lead | O | £70,000 - £74,999 | Permanent, Full | £73,638 |
### Tier Three - Reporting to Executive Director of Community & Environmental Services
| Position | Scale | Salary Range | Employment Status | Max Salary | |--------------------------------------------------------------------------|-------|-----------------------|-------------------|------------------| | Chief Fire Officer | R | £125,000 - £129,999 | Permanent, Full | £127,710 | | Head of Support & Development | N | £60,000 - £65,999 | Permanent, Full | £62,397 | | Director of Public Health | | £95,000 - £99,999 | Permanent, Full | £96,933 | | Assistant Director Highways | P | £95,000 - £99,999 | Permanent, Full | £96,933 | | Assistant Director Culture & Heritage | P | £95,000 - £99,999 | Permanent, Full | £96,933 | | Assistant Director Growth and Development | | Vacant | Permanent, Full | £96,933 | | Assistant Director Community Information and Learning | P | £95,000 - £99,999 | Permanent, Full | £96,933 |
### Tier Three - Reporting to Executive Director of Finance & Commercial Services
| Position | Scale | Salary Range | Employment Status | Max Salary | |--------------------------------------------------------------------------|-------|-----------------------|-------------------|------------------| | Head of IMT & Information | Q | £110,000 - £114,999 | Permanent, Full | £110,160 | | Assistant Director of Finance Exchequer Services | O | £70,000 - £74,999 | Permanent, Full | £73,638 | | Chief Internal Auditor | O | £70,000 - £74,999 | Permanent, Full | £73,638 | | Head of Pensions, Investments & Treasury | P | £95,000 - £99,999 | Permanent, Full | £96,933 | | Head of Procurement | P | £95,000 - £99,999 | Permanent, Full | £96,933 | | Head of Property | P | £95,000 - £99,999 | Permanent, Full | £96,933 |
## Tier Three - Reporting to Executive Director of Strategy and Governance
| Job Title | Grade | Salary Band | Contract Details | Max Salary | |------------------------------------------------|-------|-------------|------------------|------------| | Chief Legal Officer (Monitoring Officer) | Scale O | £110,000 - £114,999 | Permanent, Full Time | £110,160 | | Head of Strategy & Delivery Unit | Scale O | £70,000 - £74,999 | Permanent, Full Time | £73,638 | | Head of Business Intelligence | Scale O | £70,000 - £74,999 | Permanent, Full Time | £73,638 | | Head of Communications | Scale O | £70,000 - £74,999 | Permanent, Full Time | £73,638 | | Director for People | Scale P | £95,000 - £99,999 | Permanent, Full Time | £96,933 |
### Key to information displayed
- **Job title of post**
- **Grade of post**
- **Salary band of individual in post (£5k bands)**
- **Contract details**
- **Max salary of post**
### Note
Where posts are filled by NCC staff their salary bands are shown. Where external interims are in post, no salary is shown - details are published in the Council’s Statement of Accounts.
### Contact
- **Email:** [email protected]
- **Telephone:** 0344 800 8020
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c0547e654cb47f7283b58020d5fa2a08f7f5c48b | ## CONTENTS
| Section | Page | |----------------------------------------------|------| | FOREWORD | 2 | | 1. PLAN AND PRIORITIES FOR 2015 | 4 | | 2. ARTS | 9 | | 3. ENGLISH | 11 | | 4. EDUCATION AND SOCIETY | 13 | | 5. PROGRAMMES AND ACTIVITIES | 16 | | 6. UNITED KINGDOM | 20 | | 7. GLOBAL NETWORK | 22 | | 8. PERFORMANCE TARGETS | 31 | | 9. FINANCIAL PLAN | 35 | I am pleased to present the British Council Corporate Plan for 2013–15.
2012 was a wonderful year for the UK on the world stage and one which elevated the UK in external surveys to the world’s foremost soft power. The challenge for the British Council over the next two years and beyond is to build on this legacy. We remain deeply committed to supporting the UK’s long-term prosperity and influence by ensuring that it remains among the world’s favourite countries for language, education and culture, and a magnet for those wanting to travel, study and do business internationally.
Work is already underway. We have launched a four-year UK–Brazil arts and cultural festival to strengthen the relationship between our two countries in the run up to the 2016 Rio Games. Following the success of our arts festival in China last year we are planning showcase events to raise the profile of the UK in Vietnam and Qatar in 2013; Russia and South Africa in 2014; and Nigeria in 2015. We will continue to support the UK government’s GREAT campaign to promote the UK internationally. Building on our Olympics experience, we will work with, among others, the Glasgow 2014 Commonwealth Games and the 2013 Derry-Londonderry UK City of Culture festival to promote major national events globally. To meet the ever-increasing worldwide demand for quality English and UK qualifications, we are launching innovative new exams products and education and English language services.
This Corporate Plan does not set out a new strategy or radical change in direction, but reconfirms the track we are on. It makes adjustments to our plans in the light of the changing global environment and recommits us to achieving specific aims and targets by 2015 – these have been updated but not fundamentally changed since we first set them in 2011. We are committed to playing our part in supporting the UK’s prosperity, security and international development priorities.
For the next two years we will maintain or increase our targets for impact and activity. Our English and examinations business will continue to target ambitious income growth, though we have reduced the income target for our contract work given the tough economic environment. Overall we aim to maintain the scale of our ambition and our growth strategy against a backdrop of reducing core UK government funding and a difficult financial climate. By the end of the four-year period covered by our original 2011–15 plan we aim to increase our annual turnover by over 30 per cent to well over £900 million.
Our ability to grow, even in difficult times, comes from our commitment to being an entrepreneurial public service. We are a public service organisation backed by Royal Charter with an income earning culture. Operating in this way means continuing to become faster-paced, more ambitious, leaner and more entrepreneurial. Thirty years ago we operated in 79 countries, working face-to-face with fewer than 400,000 people. Today we are in 110 countries, working face-to-face with over 12 million people. Our turnover, expressed at current prices, has more than doubled in that time. Our grant as a percentage of turnover has fallen from 40 per cent in 1980–81 to 23 per cent in 2012–13 and will fall below 20 per cent by 2015. We believe that the more innovative and entrepreneurial we can be in the way we partner and develop paid-for services, the more lasting value we can create for the UK and for the countries where we work.
When we talk about partnering we mean working with global brands such as Microsoft, HSBC, the Premier League and Nokia to create opportunities for people worldwide and build trust between them. We also mean working with the best of the UK’s cultural and educational institutions, businesses and brands to expand the UK’s cultural and educational contribution to the world. Some of this is through sharing UK expertise and opportunities in emerging markets. Some of it is keeping the UK’s position as a destination and partner of choice for talent and creativity in developed economies. Some of it is making a difference in fragile and post-conflict states and developing countries.
We also have a job to do at home. Too few people in the UK – especially young people – have the language skills, confidence or practical support to take advantage of international opportunities. We know that the experience of studying, working or volunteering overseas is vital to job prospects and to the success of our economy. We will continue to drive for more language learning and greater participation in international programmes for the UK’s young people and help equip them to seize life-changing opportunities.
Over the next two years, as we begin to look forward to 2020, we will continue to ask ourselves how we can do more. Being an entrepreneurial public service means constantly asking how we can work for the UK at a larger scale – a scale which is meaningful in today’s world. It also means being realistic about the crucial role of our core public funding in fulfilling our commitments for the UK in countries where we cannot earn income.
But above all, being an entrepreneurial public service means that when we decide which of the myriad opportunities for UK education and culture to take forward we are always driven by our core purpose: building trust between the people of the UK and other countries. It is not enough that an opportunity generate incomes, it must first and foremost serve that core purpose. Our passion for cultural relations is what attracts our customers, stakeholders and partners to work with us. It is that passion which will drive us to achieve even more as we build on the legacy of 2012 both in the UK and around the world.
1. Plan and priorities for 2015
2015
In 2015 the British Council will be recognised as the UK’s international organisation for educational opportunities and cultural relations, as we have been since we were founded. Our public service ethos and charitable purpose have not changed in all that time, but the scale of our impact for the UK and our entrepreneurial approach are now very different. Thanks to this shift the people of the UK will be sharing culture and ways of living with millions of people, thousands of institutions and hundreds of partners in over 100 countries all around the world.
We will maintain our worldwide network of presence and expertise for the UK, giving priority to those countries of importance to the UK and those where we can achieve a significant impact. We now have leaner, lighter operations in many countries, making more use of digital services and of partner, UK government, and serviced office spaces.
We aim to do more through new partnerships, through the partnerships we have already developed and through international education and development contracts. More of our UK government grant-funded work will be in developing countries, in some of the world’s poorest countries as well as in rapidly developing and post-conflict environments.
Our English and examinations work is attracting more paying customers than ever, at the same time as we seek to bring high quality digital English services to every learner or teacher that wants them. We will continue to work with state and federal governments around the world to help them transform their education systems and increase opportunity and employability through English and UK qualifications.
Our high profile work in the arts, education and society will help hundreds of millions of people worldwide to learn about and experience creativity and excellence from the UK.
Thousands of policy makers, academics, researchers, artists, sportspeople, scientists, curators, creative entrepreneurs, heads and classroom teachers work directly with us and with their counterparts in the UK. They will continue to develop policy, professional standards and participation in English, the arts, education and civil society – creating new opportunities and possibilities for the UK and for their own societies.
We are aiming for major income growth. Total turnover will increase from £693 million in 2010–11 to £914 million in 2015 – an ambitious growth target of 32 per cent, particularly given the reduction in our UK government grant. Earned income will go up over the same period from 73 per cent to over 80 per cent of turnover. Our priorities for the next two years are to:
- accelerate the development of new services and products
- increase our income and impact
- become even better value for money.
By 2015 we will have developed a range of new services and products in the following areas:
- support for the development and enhancement of public education systems
- English for skills in a variety of sectors
- English for academic purposes
- skills development in the arts and cultural sectors
- bilateral schools work
- youth and civil society.
To support the development of new services and products we will:
- increase investment in English, so that the UK is able to offer more learning opportunities, especially through, for example, blended learning (mixing face-to-face and digital methods) and extending available qualifications
- work with UK partners to create new opportunities by sharing market analysis and developing a joint response to the needs which we have identified and with partners overseas to deliver products and services
- invest significantly in our digital platform, content and services. By 2015 we will achieve our targets for scale, quality and impact and we will have an annual turnover of £900 million. To do this we will:
- bring a new mix of innovative services and programmes with UK partners to rapidly expanding markets in high growth economies
- extend our range of English teaching services and give greater access to UK qualifications for both young and adult learners
- expand our teaching and examinations operations in critical markets using available surpluses from income earning activity
- respond to demands from new governments in North Africa and from governments across the developing world to work under contract with them and with other UK partners to transform English teaching in schools and in higher education
- inspire, educate and teach English through high quality digital and broadcast material; expand face-to-face activity, events and exhibitions work and increase participation overall by ten per cent
- do even more in partnership and through contracts with governments, donors, corporations and foundations, for a much greater impact than we could achieve alone.
By 2015 government grant will be less than 20 per cent of our turnover and we will have a more effective infrastructure accounting for under 15 per cent of our total spend. To do this we will:
- maintain impact and presence for the UK in developed countries, despite the reduction in government grant, by increasing volumes and surpluses in our paid for services
- continue our programme to increase efficiency and to re-shape our overseas network; we will make further savings and cuts of £30 million on our grant-funded work in the UK and overseas over the next two years, bringing the total to £70 million grant savings annually by 2015
- invest in developing our IT and finance platforms and capability to support growth and innovation and to provide global support services ever more cost effectively
- fund this investment from surpluses from income earning activity – by 2015, some of the surplus will also be used to cover some of the costs of operational programmes. To achieve these goals we will also:
- continue to develop the professional expertise of our staff in the arts, English and education and society and in areas which support growth such as digital, commercial partnering and business development
- invest to develop our staff and attract talented new people to work with us globally. As well as hiring more expertise in particular sectors we are also investing for the long term with new graduate and intern recruitment programmes
- develop our global teams which draw on the talent and expertise of all our people worldwide
- continue to be a diverse organisation that strives to reflect the UK today, is skilled in engaging with different cultures and follows best practice in equal opportunities and diversity
- uphold the British Council’s values of valuing people, integrity, mutuality, creativity and professionalism.
Our passion for cultural relations is what attracts our customers, stakeholders and partners to work with us. It is that passion which will drive us to achieve even more by 2015, both in the UK and around the world. We will work towards the following outcomes up to 2015:
The British Council creates international opportunities for the people of the UK and other countries and builds trust between them worldwide.
**Arts** New ways of connecting with and understanding each other through the arts.
**English** More widespread and better quality teaching, learning and assessment of English worldwide.
**Education and society** Enhanced UK leadership of, and shared learning from, international education. Societies whose young people, citizens and institutions contribute to and benefit from a more inclusive, open and prosperous world.
For each of our programmes and services we set out the expected long-term difference that we intend each one to make. These then combine to result in the high level outcomes in arts, English and education and society above.
By 2015 we will be working with:
**12 MILLION** leaders, teachers and other influencers, exam candidates, English teaching centre students and participants face-to-face.
**NINE MILLION** exhibition, festival, fair and performance visitors.
**100 MILLION** digital customers and website users.
**500 MILLION** viewers, listeners and readers.
Between 2013 and 2015, we aim to achieve steady growth in the number of people we work with across all our activities. 2. Arts
New ways of connecting with and understanding each other through the arts.
We will:
• share the best of the UK’s culture overseas at major international events • work with and alongside the UK’s arts and creative industries to develop sustainable international partnerships contributing to more connected and prosperous societies • work with other countries to help them build skills and capacity, encouraging artists and creative entrepreneurs to benefit from everything that creativity has to offer • demonstrate, in all that we do, the connections and interdependencies between the arts, the new creative industries and the cultural economy • champion and exploit the latest in digital technology to achieve a richer programme, greater impact and wider participation
We will achieve these goals by promoting excellence, diversity and innovation.
We achieve impact in arts through:
• the exchange of new and challenging ideas • the expression and sharing of emotions • the exploration of difficult issues • the increased understanding of diversity and other people’s cultures • the realisation, through exchange, of individual creative potential.
By 2014–15 we will be working annually with:
**ONE MILLION** artists, cultural leaders and ministers.
**THREE QUARTERS OF A MILLION** artists and participants in online communities.
Well in excess of **ONE HUNDRED MILLION** viewers, listeners and readers.
**MORE THAN TEN MILLION** exhibition, festival, event and performance attendees.
**OVER SIX MILLION** website users. How we achieve impact in the arts
1. WHO WE WORK WITH
- Ministers of culture, arts policy makers and local government.
- Artists and cultural leaders (festival directors, curators, academics and programmers from the UK and overseas).
- Arts students in the UK and overseas, international audiences for UK work and UK audiences for international work.
2. WHAT THEY EXPERIENCE
- International arts events, arts policy dialogue, publications, research and consultancy.
- Professional development workshops, arts awards, arts forums and networks, collaborative creation, exchange of ideas, best practice and experience, work in other countries.
- Inspiring, entertaining and transformative international arts events (exhibitions, showcases, festivals, fairs, performances).
3. WHAT THEY TAKE AWAY
- Increased knowledge and skills to work internationally.
- Increased knowledge of UK and international arts administration and policy.
- Improved knowledge and skills in the creative sector overseas.
- Knowledge and skills to support tolerance, respect and diversity.
- Improved perception of the diversity of UK art.
4. WHAT THEY DO
- Develop artistic practice by working internationally.
- Collaborate in developing arts policy and practice internationally.
- Work on joint creative projects.
- Develop new markets.
- Engage with peers in the UK and internationally.
- Develop creative and cultural institutions overseas and in the UK.
- Influence international conversations.
- Recommend and talk about their experience to others.
5. LASTING IMPACT
- More UK work is shown overseas.
- Increased international collaboration.
- International dimension to UK arts programming is strengthened.
- Increased reputation for UK innovations for cultural and commercial growth.
- More international conversations are influenced by UK artists and creative thinkers.
- Civil society, social cohesion and freedom of expression is strengthened through art and culture.
- Increased international audiences for UK work and UK audiences for international work.
- Better access to the breadth and diversity of UK arts.
New ways of connecting with and understanding each other through the arts. 3. English
More widespread and better quality teaching, learning and assessment of English worldwide.
We provide people worldwide with greater access to the life-changing opportunities that come from learning English and gaining valuable UK qualifications.
We will:
• improve the quality of English teaching in schools worldwide, supporting effective English language teaching policy and English teacher development, in collaboration with education ministries and donors • support the English language needs of students and teachers in international further and higher education systems • expand our range of self-access English language learning products offered through the internet and mobile technology, as well as through print and broadcast media • invest in and expand our global network of high quality English teaching centres • through our teaching network and self-access learning, increase the number of people learning English with us by 27 per cent over two years • continue to develop our award winning digital learning content, using the UK’s vibrant culture as an aid to language learning • continue to promote the UK as an English language learning destination • increase access to effective English assessment, to support the learning of English worldwide • give greater access worldwide to UK school and professional qualifications • overall, increase the number of people taking UK qualifications with us by 50 per cent • continue to invest in our high-performing British Council bilingual, bicultural primary and secondary school in Madrid.
By 2014–15 we will be working annually with:
HALF A MILLION policy makers and ministers, teachers and coaches.
OVER HALF A MILLION learners in teaching centre classes.
TENS OF MILLIONS of website users.
OVER FIVE MILLION teachers and learners in online communities.
MORE THAN THREE MILLION exams candidates.
TENS OF MILLIONS of viewers, listeners and readers. How we achieve impact in English
1. WHO WE WORK WITH
- English language policy makers and UK institutions.
- Teachers of English, lecturers and teacher trainers.
- Learners of English and exams candidates.
2. WHAT THEY EXPERIENCE
- Policy dialogue events, publications, research, consultancy, accreditation of institutions.
- Teaching resources, training courses, development programmes, networks, professional development frameworks.
- English courses, exams, websites, mobile apps, broadcast and social media content, virtual learning environments.
3. WHAT THEY TAKE AWAY
- Improved ability to implement successful English language policy reforms; UK stakeholders are aware of opportunities overseas.
- Improved English proficiency and enhanced classroom skills and confidence; improved digital and social media skills.
- Improved English and social and media skills and confidence; improved impressions of the quality of UK material.
4. WHAT THEY DO
- Introduce language policies to increase teacher capacity, and support effective teaching and learning; link up with UK providers.
- Teach more effectively and confidently; engage with colleagues and share experience and ideas; join networks and meet colleagues overseas.
- Use English to improve employment and education prospects, participate in social media networks and engage with online communities.
5. LASTING IMPACT
- English is firmly established in educational policy that supports a country’s development; the UK’s reputation is enhanced – as a source of expertise in English language and as a partner for language policy and reform.
- Teaching capacity increases; language teaching professionals regard the UK as a world authority that supports training opportunities, teaching resource development and professional development.
- In-country English capability increases; language learners have a positive view of English and the UK is seen as a provider of high-quality educational opportunities; English is used to engage with global audiences.
More widespread and better quality teaching, learning and assessment of English worldwide. 4. Education and society
Enhanced UK leadership of, and shared learning from, international education.
Societies whose young people, citizens and institutions contribute to and benefit from a more inclusive, open and prosperous world.
We will:
• focus on internationalising higher education, supporting the UK’s position at the heart of thought leadership and creating new opportunities for collaboration and exchange between governments, higher education institutions, researchers and businesses in the UK and around the world
• support school leaders and policy makers in the UK and overseas to improve quality and attainment levels through professional development, policy and curriculum reform, award schemes such as the International Schools Award, and technically assisted learning
• increase the international outlook, voice and leadership potential of young people through our youth and alumni networks, enabling them to shape global and local agendas
• contribute to ensuring secure and stable societies, in which growing numbers of young people can prosper, by supporting governance reform and providing opportunities for the development of skills for employment and enterprise
• expand our partnership working across the private, public and third sectors to develop, deliver and fund programmes in the UK and internationally
• work more through digital channels and by building relationships with existing and new clients to increase our impact in education and society and increase our turnover from client-funded contracts and services.
By 2014–15 we will be working annually with:
MORE THAN TWO MILLION education ministers, teachers, academics and education and youth sector leaders.
OVER FIVE MILLION teachers, academics, college and higher education leaders in online communities.
ONE AND A HALF MILLION education and citizenship exhibition and fair attendees.
TENS OF MILLIONS of website users. How we achieve impact in education
1. WHO WE WORK WITH
- Education policy makers.
- Teachers and academics, school, college and higher education leaders.
- Primary, secondary and tertiary students.
2. WHAT THEY EXPERIENCE
- Policy dialogue and research, for example, international higher education regional policy forums.
- Sector advisory and market intelligence services.
- Professional development and training, peer networks, qualification recognition and benchmarking.
- Joint education programmes.
- Competitions and joint projects, work placements, exchanges, education fairs.
3. WHAT THEY TAKE AWAY
- Improved understanding of different agendas and policies in education, the workplace and wider society.
- Increased understanding of the differences and similarities between cultures.
- Improved skills, motivation and confidence.
4. WHAT THEY DO
- Develop shared solutions to education issues.
- Share best practice in education and educational reform.
- Improve curriculum and assessment.
- Select the UK and UK institutions for study and exams.
- Collaborate with students in other countries and use this experience to study and work with peers.
5. LASTING IMPACT
- Increased recognition of the UK as a source of expertise and a partner for education and skills development.
- Increased capability in international co-operation that supports the development of educational institutions.
- Increased economic value and benefits to the UK.
- Increased UK contribution to, and benefits from, international co-operation in education and research.
- Greater educational and employment opportunities for individuals in the UK and overseas through increased knowledge and skills, including intercultural understanding and access to education.
Enhanced UK leadership of, and shared learning from, international education. How we achieve impact in society
1. WHO WE WORK WITH
- UK and overseas youth sector organisations, youth-led bodies and a wide range of policy makers.
- Community leaders, non-governmental and community-based organisations, social enterprises, volunteers and youth audiences.
- Government and institutions including leaders, policy makers, representatives of civil society and business.
2. WHAT THEY EXPERIENCE
- Youth policy, round tables and symposia, dialogues, social media networking.
- Volunteering, training coaching, mentoring and exchanges.
- Capacity building including skills, policy and leadership.
- Open dialogues, exchange of experience.
3. WHAT THEY TAKE AWAY
- Leadership and intercultural skills which support social cohesion and employment.
- Improved understanding of different policy agenda and processes.
- Knowledge and tools to support collaboration and dialogue.
- New skills and more confidence through volunteering, training, coaching, mentoring and exchanges.
- Increased understanding and capabilities in judicial, social and government reform.
- Tools for voice and engagement, such as advocacy and policy dialogue.
- Knowledge and skills from UK and international experience.
4. WHAT THEY DO
- Engage with peers in the UK and other countries and with relevant partners and policy makers on local and global issues.
- Articulate youth voice, influence policy and showcase good practice.
- Participate by supporting community development and social cohesion.
- Develop new policy and practice, laws and regulations.
- Build stronger institutions and new communities of practice.
- Build more effective civil society organisations.
- Share experience and capability to advocate and represent citizen needs effectively.
5. LASTING IMPACT
- Innovative national, regional and global collaborative networks created with and led by youth bodies and young professionals in the UK and overseas.
- Better integrated communities with active engagement of civil society and social enterprise.
- Improved knowledge of the UK resource.
- Open and accountable government and institutions, actively engaged with civil society.
- Recognition of UK as a source of expertise and an effective partner for supporting open dialogue and positive reform.
- Stronger civil society capability that draws on international experience.
Societies whose young people, citizens and institutions contribute to and benefit from a more inclusive, open and prosperous world. 5. Programmes and activities
Arts, English and education and society working together
Over the next two years we will look for innovative ways to bring together our arts, English, education and society work to create maximum impact, as we did for the 2012 Olympic and Paralympic Games. Using the inspirational power of the Games as a focal point, we involved young people all around the world last year in making international connections through school links, through participation in Cultural Olympiad arts events and through new English language learning materials linked to the Games.
We will build on this experience to involve people from the UK and around the world in cultural and educational activities to mark forthcoming major anniversaries and national events. These will include the Glasgow 2014 Commonwealth Games, the 2014–18 First World War Centenary and the anniversaries of Shakespeare’s birth in 2014 and death in 2016.
Our flagship education programme for the Commonwealth Games will be a large-scale schools linking project, modelled on the schools partnerships we developed with the BBC for London 2012 and run with the BBC and the Commonwealth Secretariat. Through the Games, we aim to inspire 17 million school children across the ten largest Commonwealth countries to consider Commonwealth values and what it means to be a citizen of a Commonwealth country today.
We are also planning arts projects as part of the cultural programme to celebrate the Games. In partnership with Creative Scotland and Arts Council England we will support the new Music Biennial being held by the PRS for Music Foundation. With the National Galleries of Scotland, Creative Scotland and Glasgow Life we will support a project to celebrate Scottish visual arts of the last 25 years. This will be exhibited in galleries across Scotland before we tour a selection overseas.
Further contributions to the Games and to other anniversaries and events are already being planned and will also involve a mix of educational and arts activities as well as the development of new resources for English language teaching.
We will also continue to be a major participant in the UK government’s GREAT campaign, which has now been extended to 2015. This cross-government initiative aims to use the London 2012 legacy to encourage people around the world to visit the UK and do business here. We will support higher education, arts and English language campaigns in specific countries and lead on student recruitment. Sport, science and sustainable development
These are themes that make an important contribution to what we do, helping us to build bridges and reach people, often in difficult environments. Through them we can show the UK’s strengths, increase the UK’s standing and attract partners to work with us.
Sport plays a natural role in cultural relations – all countries value it, it transcends many of the things that divide us and it provides a simple, practical way of bringing people together and building their skills and confidence.
All of our work in sport will be done in partnership. With partners, we will work on policy reform, professional development and capacity building. We will provide training for coaches, teachers and young people and support the development of community and education networks. With the Premier League we will explore how we can build upon our Premier Skills programme to promote community development and help young people develop life skills and learn English through the medium of football. With our partners, UNICEF and UK Sport, we will continue to run International Inspiration, which was the international sport legacy programme of the London 2012 Olympic and Paralympic Games. This programme has already met its target of enriching the lives of over 12 million young people around the world through the power of sport and is now aiming to reach even more.
In science, we support policy discussion and new partnerships for research and innovation between the higher education sector, government and business communities. For example, through the UK–India Education and Research Initiative, a multi-stakeholder programme, we will continue to support new and sustainable partnerships between UK and Indian higher education institutions, including in the area of research and innovation. This initiative will also encourage and support the development of two ‘Innovation Universities’ in India.
We will help early career researchers, especially in emerging scientific nations, to build their communication skills and international careers and will develop mutually beneficial links between them and the UK. We will continue to work in the area of public engagement in science, supporting international networks of talented science communicators and helping them to inspire the next generation of scientists and engineers. This work will build on initiatives such as FameLab International. Created by Cheltenham Festivals, FameLab® gives young scientists three minutes to entertain and engage a live audience. It is now run in partnership with the British Council and national partners in over 23 countries. We will nurture future scientists and engineers by introducing more science and technology themes into our schools programmes, building on the UK’s reputation for excellence in communicating science.
Working with universities, governments and learned societies, such as the Royal Society, we draw on the UK’s leading expertise to provide content on sustainable development for our education and society programmes. For our Climate4Classrooms programme, for example, we work with the Royal Geographical Society and the Royal Meteorological Society to develop materials for our Schools Online portal.
## Summary of our main programmes and activity for 2013–14
| Programme | Description | |------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | **London 2012 Legacy** | Building on the success of 2012, we will play our part in celebrating forthcoming anniversaries and major national events including the Glasgow 2014 Commonwealth Games, the 2014–18 First World War Centenary and the Shakespeare anniversaries in 2014 and 2016. | | **Arts** | | | Showcase events | High profile showcases of new work and collaboration, skills development and residency programmes, including seasons of art and culture between the UK and Qatar in 2013; the UK and Russia in 2014; and the UK and South Africa from 2014 onwards. | | UK–Brazil Transform 2012–16 | Bridging the London 2012 and Rio 2016 Olympics, Transform will reinvigorate arts work between Brazil and the UK and create foundations for a permanently strengthened relationship between the two countries. | | The British Council Collection | Updating our Collection with new works so that it continues to reflect the best of contemporary UK art. Creating greater access to the Collection for more institutions in the UK and overseas, through a new partnership with the Arts Council Collection. Launch of a series of exhibitions to reach extensive new audiences worldwide. | | Creative economy | A refreshed programme to form connections between the rapidly growing creative industries sector in the UK and overseas and maximise benefit for the UK from our vibrant creative economy. | | **English** | | | UK examinations | Providing access to English language and other UK qualifications worldwide. | | English for public education systems | Supporting both the development of English language learning and teaching, and the use of English to teach subjects across the curriculum, in schools and further and higher education institutions. Through research, consultancy, collaboration with policy makers, curriculum development and teacher training programmes we will help strengthen the quality of English language teaching and the understanding of language in cultural relations and development. | | Face-to-face and blended English | Providing over 400,000 individual and group learners of English with a range of face-to-face and blended courses, both through partners and in our 80 plus centres worldwide. | | English for self-access learners | Providing courseware, online, mobile, broadcast and print resources for learners to improve their English through any channel, as well as global online training resources for teachers of English. | | **Education and society** | | | Schools | | | Schools programme | Increasing attainment levels in schools through policy and curriculum reform, professional development, school links, accreditation and technology-assisted learning. Schools Online, our digital platform, will support this. | | International development contracts | Supporting the development of schools through policy reform, teacher training and curriculum development. | | Comenius | Developing the skills of young people and education professionals and strengthening their knowledge and understanding of the diversity of European cultures and languages (EC-funded). | | **International higher education** | | | British Council Services for International Education Marketing | Our exclusive service for UK education providers in support of their international education strategies. | | **Education Intelligence** | Research and client-funded services on global, regional and country trends in higher education. | |---------------------------|-----------------------------------------------------------------------------------------------| | **Going Global** | Shaping the global higher education agenda through thought leadership and global policy dialogues including an annual summit, Going Global. | | **Knowledge Economy Partnerships** | Facilitating and supporting international research collaboration and global partnerships between governments, universities and business. | | **Students and alumni** | Leading and innovating in global student mobility and building on international experience. | | **UK–India Education and Research Initiative** | Brings universities, businesses and governments together to promote research and innovation, provides opportunities for professional and leadership development of higher education institutions, vocational institutions and schools and develops programmes for student mobility and skills development. | | **Erasmus** | EC-funded programme to support higher education student mobility to prepare students for the labour market. | | **Scholarship contracts** | A range of contracts which support student mobility, international education and development. | | **Skills** | | | **Skills for Employability** | Supporting skills development and addressing labour market demands and learner needs, particularly in countries with large populations of young people. | | **Skills for Social Entrepreneurs** | Supporting new employment, growth and development in social enterprise, particularly in emerging and developing countries. | | **International development contracts** | Working with the higher and further education communities to help improve employment prospects for young people and increase employer involvement in tertiary education. | | **Youth and society** | | | **Next Generation Networks** | A worldwide network of young social entrepreneurs, community leaders and influencers working together to create positive changes in their lives, their communities and the world. | | **International Inspiration** | Working with London 2012 partners to leave a lasting international legacy by strengthening and improving access to sport in countries around the world, building the skills and confidence in young people to improve their own lives. | | **Premier Skills** | Partnership with the English Premier League using football to develop life skills for young people, English language learning and community coaching. | | **Youth In Action** | An EC-funded programme supporting active European citizenship, skills development and cultural understanding among young Europeans. | | **Governance and society**| | | **Active Citizens** | Supporting more cohesive communities and more effective civil society by working with civil society organisations and their leaders to help them innovate, be accountable, and gain access to UK and international experience. | | **Springboard** | Providing personal development opportunities for women in the Middle East. | | **International development contracts** | Support for poverty reduction, economic growth, access to justice, and social and economic empowerment, especially in Africa and South Asia. | 6. United Kingdom
The hugely successful Olympics, Paralympics, cultural Olympiad and Diamond Jubilee celebrations have given the UK a tremendous boost on the world stage. The UK’s cultural standing has been greatly enhanced and perceptions of our world-class cultural and educational institutions and open, welcoming and successfully diverse population have been refreshed and updated.
There is much to build on in the next few years. British Council research shows that interest in visiting, studying and doing business in the UK is up. The UK’s soft power – the power of cultural attraction – has never been more highly regarded and the global demand for English, UK education and arts greatly exceeds the UK’s capacity to respond to it.
All four UK governments continue to place great importance on the economic benefit to the UK from international opportunities and on investing in international experience for young people. At the same time, international opportunities and the scope for partnerships for UK cultural and educational institutions to share UK expertise and creative content are strong and growing.
Looking ahead to 2015, we are confident that we can build on the legacy of 2012 by creating more international opportunities for the UK’s young people, for our vibrant education and culture sectors and for the UK as the home of the English language.
Building on the legacy of 2012
• We will continue to be a major participant in the UK government’s GREAT campaign which aims to support economic growth by highlighting internationally the best of what the UK has to offer. In particular we will lead on student recruitment by encouraging and supporting international students, especially those from emerging economies, to study in the UK.
• Building on our London 2012 experience, we will involve people, brands and cultural institutions from the UK and around the world in events and activities to mark forthcoming major anniversaries and national events. These will include: • Derry-Londonderry UK City of Culture 2013 • Edinburgh Festivals 2013 and 2014 • WOMEX (World Music Expo) in Cardiff in 2013 • Benjamin Britten Centenary 2013 • Glasgow Commonwealth Games 2014 • Dylan Thomas Centenary 2014 • First World War Centenary 2014–18 • Shakespeare 400 in 2014 and 2016. Internationalising the UK’s young people
• We will continue to work with UK schools, through a range of programmes, to give more UK pupils a greater awareness of the world and of the international opportunities that exist for them.
• We will promote international study opportunities for the UK’s young people, for example through the EC-funded Erasmus programme.
• We will help young people to develop the language skills they need to access international opportunities, for example through our foreign languages assistant scheme, which places native language speakers in UK schools.
Supporting UK higher education
• We are now working with every university throughout the UK. We will continue our focus on internationalising higher education, working with UK partners on international education activities such as partnership development, student recruitment, student mobility, curriculum development, educational quality assurance and international market intelligence.
• We will work to develop more research links between early stage researchers in the UK and overseas, supporting them to form long lasting collaborations.
• Our annual Going Global conference will remain the sector’s leading international higher education policy forum, with UK institutions at its heart.
Promoting the UK as an English language learning destination
• We will continue to support UK-based English language providers to enrol hundreds of thousands of English language students each year. Our provision of UK examinations and qualifications is worth tens of millions of pounds in export earnings for UK examinations boards.
• We will continue to enhance the UK’s position and convening power as the world leader for quality English.
• We will develop new digital and face-to-face materials for learners of English worldwide which stimulate their interest in the UK as well as giving them the English language skills they need for employability.
Bringing top UK contemporary art to international audiences
• We will work with our arts network worldwide through major international arts seasons such as those planned for Brazil (Transform) in 2012–16; Qatar in 2013; and South Africa and Russia in 2014, to involve the best UK partners, sponsors, investors and participants and create maximum impact from those seasons in the UK.
• We will present the UK’s diversity at major international cultural events and respond to the fact that the arts are a priority for our top stakeholders in all four UK countries. 7. Global network
Over the last 30 years we have expanded our global network from 79 to 110 countries. Being on the ground is at the heart of everything we do and we are deeply committed to maintaining this worldwide presence. Although we recognise that building trust takes staying power, we will continue to change and develop the network where necessary, in response to new international priorities and the availability of funding. This will mean opening new operations and teaching centres and, occasionally, making the difficult decision to close smaller ones.
Within each region we have identified priority countries, which are highlighted in bold in the following pages of this plan, and which benefit from more resources and a wider range of activity. Priority is determined by a country’s importance to the UK, the potential for us to make an impact there and business feasibility. Emerging economies such as China, India, Brazil, Mexico, Turkey, Indonesia, Vietnam and Nigeria continue to be high priority. We will also focus on countries in the Middle East and North Africa currently experiencing profound change and continue to seek to make a difference in challenging environments such as Afghanistan and Pakistan. Our work in English, in particular, is expanding right across the network and through English we will be reconsidering how we can expand our impact in Latin America.
To ensure the future of our network, we will continue to find more flexible ways of operating with fewer fixed costs. For many years our policy has been to move from owned to rented premises, which gives us a much greater flexibility to change in size or location. In some places we will take this further by leaving branded premises and moving to lower cost options in serviced office space or co-locating with the Foreign and Commonwealth Office, other partners or analogue organisations. In some regions we now have a number of country operations with local rather than UK country directors, managed from a central country hub. For example, our hub in Poland oversees our operations in Bulgaria, Latvia, Lithuania and Estonia. Technology will enable us to create ‘smarter’ working environments and to develop truly global teams so that we can make cost-effective use of expertise wherever it is located. Globally, finance and IT support will largely be provided by our shared services centre in India. We will continue to seek partners to work with us globally, in the UK and locally as we develop and implement new programmes.
Over the next two years the reducing government grant means that we will cut grant funding of the overseas network by £18 million. At the same time the amount of our grant that has to contribute to the UK’s commitment to overseas development will go up. We have invested in expanding our income earning activities and aim to increase self-generated income overseas by over 30 per cent – a very challenging target. We have re-allocated resources between countries across our seven overseas regions in response to these factors and to the need to seize new opportunities and reflect changing geopolitical priorities. The allocation of government grant reflects the priority given to South Asia, the Middle East and Africa where there are limited opportunities to fund our vital work in developing, post-conflict and fragile countries from earned income. Conversely, by 2015, both East Asia and EU Europe regions will be over 90 per cent funded by self-generated income. Income by overseas region for 2013–14 and 2014–15 in £ millions
We aim to complete our programme to regularise our status worldwide by 2015. We have resolved our status in 66 countries so far. In some cases, rather than a branch of the British Council charity, we have had to create a new company or foundation in order to operate effectively. By 2015 we expect that there will be about 20 wholly-owned companies or foundations overseas, covering some of our highest priority operations. While this increasingly complex structure brings additional reporting requirements, it provides the crucial foundation for our ambitious planned income growth and will give us the licence to continue to operate across the network. 7.1 Americas
Americas: Argentina, Brazil, Canada, Chile, Colombia, Cuba, Jamaica, Mexico, Trinidad and Tobago, USA, Venezuela
Regional context
This region includes some of the UK’s most important international partners, both historically and for the future. Continuing strong economic growth, an emerging middle class, democratic political stability and a growing voice on the world stage all characterise the major economies in Latin America. The importance of Brazil, Mexico and other high growth economies such as Colombia for global trade and dialogue is increasing. Governments and citizens are developing stronger international outlooks, and the demand for English, education and training services and new partnerships is growing.
In North America, the relationship with the USA continues to be highly significant for the UK, with the US market remaining a priority for many of our UK partners in higher education and the arts. Changing demographics in the USA and Canada mean that many people there now have deeper ties to Latin America and Asia than to Europe. This creates an opportunity to refresh transatlantic relationships through cultural relations activities which have been re-imagined for a new generation.
Our response is to:
• build on the UK’s unique opportunity to strengthen its relationship with Brazil through the handover of the Olympic and Paralympic Games • contribute to English language teaching policy development • innovate and partner to support better quality English teaching and learning across Latin America on a much greater scale • develop new international partnerships in higher education and schools and share experience in formal and non-formal education through skills and sports • foster new connections with UK arts and creativity • increase our capacity to make an impact across the region by working with major partners such as Microsoft.
Our priorities
Our top priority in Latin America is English. We will implement a teacher development strategy which uses remote teaching technologies, including video links from third countries, and draws on a growing network of online mentors and coaches. We will provide the 75 million learners and 450,000 teachers of English with access to high quality resources from the UK. We will reach growing numbers digitally and through partnerships with policy makers, education ministries, and providers. We will administer more exams and expand teaching beyond our three existing centres.
Our arts programmes will reach new and larger audiences. The UK–Brazil Transform 2012–16 festival – the largest we have ever staged – will feature flagship cultural events and help strengthen the relationship between the UK and Brazil. Working with the best of UK arts organisations and brands such as the Victoria and Albert Museum, the British Museum, the Hay Festivals and the Edinburgh showcase, we will increase collaboration and exchange with the UK across the region. We will work with cultural and creative entrepreneurs to help develop policy which supports prosperity and intercultural understanding.
Our support for internationalising higher education will focus on increasing the market for UK programmes and developing links between higher education and industry, giving more opportunities for partnership and policy dialogue. We will develop leadership programmes, including sports education, and nurture collaborative networks for leading young citizens, including those who have studied in the UK.
The population of this region is just over 800 million.
Source: United Nations
GDP per capita in this region ranges from US$48,000 in USA, to US$5,000 in Cuba.
Source: World Bank
Brazil is currently the world’s seventh largest economy by GDP and Mexico is the world’s eleventh largest.
Source: CIA World Fact Book 7.2 East Asia
East Asia markets: Australia, Burma, China, Hong Kong, Indonesia, Japan, Republic of Korea, Malaysia, New Zealand, Philippines, Singapore, Taiwan, Thailand, Vietnam
Regional context
The rapid pace of economic and social change which characterises the emergence of Asia as an economic and political power is reflected across the region. China’s new leadership will continue to focus on economic growth. This, together with urbanisation, a drive for innovation and development of the creative sector, will require new skills. There is increased external interest in Association of Southeast Nations (ASEAN) countries, where economic growth is mirrored by population growth and a strong interest in education reform and skills development. Indonesia and Burma have emerged as priority markets in this context. A number of markets (for example Singapore) are investing heavily in domestic and transnational education while Japan and Taiwan are internationalising higher education to attract overseas students to campuses affected by shrinking populations.
The challenges of rapid growth and employability have resulted in a strong focus on skills development for students and teachers of English, and for the social and creative enterprise sectors. Digital technology and social media are increasingly a normal part of daily life in the region.
Our priorities
Our focus on paid educational services in English has started well with a large teacher training contract and an additional up-skilling contract in Malaysia. We will grow our programmes for English learners through an integrated business approach, working through state systems, face-to-face teaching, online and mobile devices and broadcast media. We will continue to open new teaching centres, including a new initiative in Indonesia. Candidature for the IELTS examination continues to grow. Promotion of our new Aptis examination for learners will continue to be a priority. This is now a key product for meeting the demands of policy makers for improved assessment.
In education and society, we will continue to support fresh thinking on policy for regional education leaders through our successful global education dialogues. We will focus on the market for UK transnational programmes, for example through support to the Vietnam–UK new university initiative in Danang, and build on the demand from the UK for paid-for market analysis services in this high priority region. In China, we will expand the Knowledge Economy partnership and, with other UK bodies, develop a new set of these partnerships in ASEAN countries. We will continue to expand skills training and youth engagement in social enterprise with partners in private and public organisations. We will build our capacity to expand our contract work in Indonesia, Vietnam, Burma, China and the Philippines.
All countries will run arts programmes to increase audiences for UK creativity. We will follow the hugely successful UK Now arts festival in China with showcasing events in Vietnam in 2013 and in Indonesia in 2014. We will work on skills development in arts management, cultural heritage and the creative industries. Republic of Korea will be a focus of the 2014 London Book Fair.
Six of the 13 markets in this region are in the world’s top 20 economies by GDP.
A total of eight countries in this region are on the OECD list of countries eligible for official development assistance.
The population of this region is over two billion (one third of the world’s population), nearly a quarter is under 14 years old.
Source: CIA World Factbook Source: OECD Source: United Nations and CIA World Factbook 7.3 EU Europe
European Union: Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxemburg, Malta, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, Switzerland
Regional context
This region covers the EU member states plus Norway and Switzerland – highly developed economies facing challenges in recovering from global recession, adapting to ageing populations and addressing youth unemployment. The eurozone countries face major risks in tackling debt and regaining market confidence, though some priority countries such as Poland and Germany are proving relatively resilient. Austerity measures are bringing pressure on social cohesion and there is rising nationalism, further fuelled by migratory pressures in many parts of Europe. The EU remains the UK’s largest trade partner and is vital to UK interests.
This region is home to major corporate, governmental and civil society partners. There are great opportunities for us to work both with them, and under contract from the European Commission, to do cultural relations work on a large scale. As a leading partner in the network of EU institutes for culture (EUNIC) we can play a significant role in influencing cultural policy in the EU. With a huge market for English language learning and qualifications, we continue to generate substantial income from paid-for services. Our government grant in the region has declined dramatically and by 2015 well over 90 per cent of our turnover will be from self-generated income.
Our response is to:
- engage the UK with Europe and mobilise European partnerships for the benefit of the UK
- maximise opportunities for young people in the UK to gain a more international outlook by connecting with their peers in Europe and taking part in European mobility programmes
- grow and diversify income-generation opportunities, particularly in our more economically resilient priority countries, to become self-sustaining by 2017
- pursue new opportunities offered by the European Commission and member state governments for doing more cultural relations work through co-funding
- invest in effective digital engagement to reach larger audiences.
Our priorities
Our top priority is to respond to sustained demand for English through our paid-for teaching and examinations services and by providing wider support for all teachers, learners and language policy makers. We will work with public education bodies and UK partners to raise the quality of English language teaching and assessment. We will invest in digital channels and content providing resources both paid-for and free-to-download. The Madrid School, which offers a much-valued bilingual liberal education and a British curriculum to young Spaniards, will remain a priority.
Arts is a priority in selected countries and we aim to promote digital and broadcast arts work such as the innovative National Theatre live screenings in all countries. We will reach new audiences, working with partners and UK arts professionals, to support commercial and co-creation initiatives. From 2014 we will promote the creative industries though the European Commission Creative Europe programme.
In education and society, our focus will be on internationalising higher education and re-engaging with universities on shared policy challenges. We will promote global education market intelligence products and encourage mobility and employment opportunities for young people. We will create new co-funded partnerships for young people in the UK to connect with their peers in the EU and gain the skills they need to compete in today’s global economy.
The EU has a population of around 503 million people, just over seven per cent of the world’s population.
GDP per capita in this region ranges from US$98,000 in Norway to US$7,000 in Bulgaria.
The average median age of the EU population was 40 years in 2008, and is projected to increase to 45 years by 2030.
Source: Eurostat Source: World Bank Source: Eurostat 7.4 Middle East and North Africa
Regional context
Dramatic changes continue to affect the Middle East and North Africa following the uprisings of 2011. Revolutionary upheaval has created new political and social forces and led to election victories in Tunisia and Egypt for Islamist parties. Across the region, no country remains unaffected and instability and uncertainty are likely to continue for some time to come.
High levels of historical mistrust in the West persist, making it crucial to build trust with the UK. There are considerable opportunities to do this through international engagement to support reform and the development of strong civil societies. Young people make up more than half the population of the region. They need help to gain skills for employment, access to international opportunities and a voice in shaping the future. There are also significant opportunities for the UK to support educational growth in the Gulf, as well as economic and social development.
Our response is to:
• help address the challenges faced by young people in participating in their societies and accessing employment • support individuals, governments and the private sector to find ways of working together to shape the future • support people to gain the skills needed for employment in new areas such as the creative economy and social enterprise.
Our priorities
Skills for employment, higher education leadership and school links are our education priorities. We will develop existing relationships with education ministries to support education policy reform. Working with partners, we will help young people to access education and develop the skills needed to find employment and drive social change. We will support women to participate in economic and political life. Our society work will build youth networks and stimulate debate through programmes like Young Arab Voices, which is funded by the Foreign and Commonwealth Office/Department for International Development Arab Partnership Initiative. We will organise conferences to strengthen relationships between new leaders from North Africa and the UK, building on our 2012 North Africa Leadership Conference in Hammamet, Tunisia. Responding to increasing recognition that the youth voice in the region must be heard, we will work with local organisations to review and renew our civil society work in the Gulf.
Demand for English is high and continuing to rise. We will support the development of national policies for English language training, building on our experience of working with the Tunisian Ministry of Education across the school system. We will support teachers and learners of English through digital and broadcast media and face-to-face. Working with partners such as HSBC and the Arab League we aim to reach a total of more than ten million English teachers and learners across the region by 2015.
There is enormous respect and support for the arts in the region. This provides a vehicle for expression where freedom of speech is limited and creates opportunities for establishing dialogue with the UK. Our research on the role of the arts in reform will shape our new arts programme and help us support countries to develop their own cultural policies. We will foster new connections and greater creativity through exhibitions, publications, concert tours and showcase events such as the Qatar 2013 Year of Culture.
GDP per capita in this region ranges from US$92,500 in Qatar to US$1,000 in Yemen.
The population of this region is nearly 315 million and around half are under the age of 25.
11 out of 17 countries and territories in this region are on the OECD list of countries eligible for official development assistance.
Source: World Bank Source: United Nations Source: OECD Regional context
Fast moving and turbulent, South Asia has rapidly-growing economies and a rising middle class as well as conflict, extremes of poverty and low literacy rates. This region is critically important to the UK in terms of trade, business, security and development. India is an emerging global power with which the UK is keen to reinvigorate its relationship. Nepal, Bangladesh and Sri Lanka are growing at six to eight per cent a year, despite economic and security difficulties. Pakistan and Afghanistan are central to the UK’s security interests. The UK is committed to supporting Afghanistan’s long-term development beyond the withdrawal of its troops in 2014. Bangladesh remains one of the top recipients of UK development assistance and, with Pakistan, has strong diaspora links with the UK.
There is huge demand in the region for English for employability and also growing investment in education, an increasing appreciation of the arts and cultural industries, and rapidly escalating access to digital technologies.
Our response is to:
• reach 100 million learners and teachers of English by making our programmes and materials more readily accessible • increase educational opportunities for young people by strengthening national education systems and providing access to UK education and qualifications • use the arts to build greater understanding and trust between the peoples of the UK and South Asia • support the development of the next generation of leaders in South Asia and strengthen their links with the UK • maintain an effective network of offices, investing in our premises in India, Pakistan, Bangladesh and Sri Lanka, where we will open a new office in Jaffna in 2013.
Our priorities
English is critical across the region. To work with larger numbers, we will develop new partnerships, invest in digital delivery and in face-to-face English teaching, and find ways to reach people who have not traditionally had access. We will expand our English teacher training programmes. Having already trained over 750,000 teachers in India, we will increase that number significantly by 2015. In Pakistan we aim to reach 500,000 teachers. South Asia is one of the largest markets globally for UK exams boards. We will invest in exams to improve customer experience and connect exams candidates more with other cultural relations activity.
In education internationalising higher education is a priority. The UK–India Education and Research Initiative project will continue to create new India–UK higher education partnerships and research links. Over the next four years we will manage a major EU-funded programme to strengthen higher education collaboration between the EU and India. Our schools work will enhance leadership and quality and create 435 partnerships between the UK and South Asia. Our society programmes will operate mainly in Pakistan, Bangladesh, India and Sri Lanka, working to build the capacity and confidence of young people to lead at community and national level.
We will increase our arts work, strengthening collaboration between the creative industries and arts practitioners in the UK and in South Asia. We will develop a new programme for Afghanistan, Sri Lanka and Pakistan exploring how the arts can contribute to addressing post conflict issues.
7.5 per cent of the UK population is of South Asian origin.
All the countries in this region are on the OECD list of countries eligible for development assistance.
The population of this region is 1.7 billion and around 30 per cent of them are below the age of 20. 7.6 Sub-Saharan Africa
Sub-Saharan Africa: Botswana, Ethiopia, Ghana, Kenya, Malawi, Mauritius, Mozambique, Namibia, Nigeria, Rwanda, Senegal, Sierra Leone, South Africa, South Sudan, Sudan, Tanzania, Uganda, Zambia, Zimbabwe
Regional context
Sub-Saharan Africa is changing fast. With 1.75 billion people set to live in the region by 2050 and a GDP forecast to grow by seven per cent per annum over the next two decades the future looks promising. High growth economies such as China, India and Brazil continue to invest in the region, raising their profile there. However, poor leadership and weak rule of law remain serious issues and political instability, corruption and inequality continue to limit the development of civil society. The African demographic is young, aspiring and not tied to the past. Within 15 years it will represent a quarter of global under-25s, with 25 per cent of them facing unemployment.
The challenge for the UK is how to respond to this new Africa in a way that meets the changing needs of the people, addresses ongoing developmental issues and raises awareness of the UK amongst a new generation.
Our response is to:
- meet the demand among young people for employment enhancing skills and qualifications
- raise awareness of the new Africa in the UK and of the UK’s cultural and educational strengths amongst young Africans
- work with international development partners to strengthen government reform and civil society
- harness the shared interest of global partners to make a significant impact in international development
- support the UK English language teaching sector in meeting the demand for UK English language and vocational training.
Our priorities
We will meet the growing regional demand for English as a tool for development, including in Anglophone countries where English quality has fallen. We will increase access to English materials using, for example, solar digital players. We will use our new English language assessment product, Aptis, to meet the demand for qualifications which support personal and wider economic growth. We will increase impact by working with ministries, universities, teacher associations and partners such as VSO and the Open University. We will support 14 million teachers, face-to-face and online.
In education we will support the improvement of quality in subjects essential for employment. We will work to address inequality and poverty by sharing access to international best practice, knowledge and innovation, and to skills, professional development and UK qualifications. We will continue to work with partners like Microsoft to increase school leadership and the innovative use of ICT by over 10,000 teachers. Our work in society, particularly with women and young people in fragile states, will continue to focus on security, justice and strengthening civil society and we will extend our work in stability and conflict resolution.
Our arts programme will have two main strands – we will share the best of what the UK has to offer in the arts through high profile showcasing events and give support to creative entrepreneurs. We will launch major showcasing programmes in South Africa in 2014 and Nigeria in 2015. With regional partners, we will promote the growth of creative industries by supporting policy development and helping creative entrepreneurs to develop commercial skills. This will build on our successful Creative Expo events which brought together people from the UK and Nigeria who work in the creative industries to share experiences and ideas.
22 out of the 23 countries with the lowest gross national income in the 2012 World Development Indicators (less than US$550 per annum) were in Sub-Saharan Africa.
GDP per capita in this region ranges from just under US$9,000 in Mauritius and Botswana to just under US$400 in Ethiopia and Sierra Leone.
Non-traditional partners such as China, Brazil and India now account for 50 per cent of African imports and 60 per cent of exports.
Source: World Bank Source: World Bank Source: International Monetary Fund 7.7 Wider Europe
Wider Europe: Albania, Armenia, Azerbaijan, Bosnia and Herzegovina, Georgia, Israel, Kazakhstan, Kosovo, Macedonia, Montenegro, Russia, Serbia, Turkey, Ukraine, Uzbekistan
Regional context
This is an exciting and diverse region with young populations, booming economies in Turkey and Russia and oil and gas riches in Kazakhstan and Azerbaijan. Most countries are emerging from periods of isolation and re-engaging with the rest of the world. We are well placed to meet the demands of governments and individuals for high-quality English language learning, world-class arts programmes from the UK, higher education partnerships and skills development.
Internet penetration is increasing rapidly across the region and fuelling a huge expansion in the use of social media. By 2015, 200 million people will be online, an increase of 55 million since 2011, and 75 per cent of them will be using social media, up from 58 per cent in 2011. We are responding to these opportunities, and to the reduction in our grant funding, by creating smaller, more digitally savvy operations, investing in staff with strong understanding of their markets (half of our Country Directors in the region are now country nationals) and diversifying our sources of funding in order to expand our activity and increase our impact.
Our priorities
English is a priority development need in all countries in the region, and we are responding comprehensively to this need. We plan to add new teaching operations in Turkey, Kazakhstan, Azerbaijan and Serbia to our existing operations in Ukraine and Georgia. We also plan to double the volume of British exams we deliver. We aim to reach every teacher in public education through online courses and resources, in addition to face-to-face training and support. Increasingly we will work directly with education ministries to meet their needs for more effective teacher development and learner assessment.
The arts are another priority, with dynamic partnerships bringing new UK work to audiences across the region and demonstrating the role that culture can play in developing relationships. Building on major cultural collaborations from 2011–12, we will continue to help strengthen ties between Russia and the UK through the UK–Russia 2014 Year of Culture. Turkey is the market focus country at the 2013 London Book Fair. In Israel and Ukraine we will continue to forge bold new co-operation in film and the visual arts. Our performing arts partnerships are being reinvigorated with high-profile company visits to festivals, a capacity-building initiative for theatre ‘backstage’ professionals and a pioneering inclusive performance project drawing on innovative UK models and expertise.
We will support higher education reform agendas, and strengthen collaboration with the UK through policy dialogues and partnership programmes. We will develop our international marketing services to UK higher education institutions. We will continue skills development work in countries which look to UK vocational education models.
Our response is to:
• meet the need and demand for English, working with policy makers, teachers and learners and making the most of digital channels • work in the arts and creative industries to strengthen relationships with the UK and raise awareness of the UK as a place of imagination and innovation • strengthen UK partnerships and collaboration in higher education and skills.
The population of this region is around 350 million, one third of which is under the age of 24.
GDP per capita in this region ranges from US$31,000 in Israel to US$1,500 in Uzbekistan.
13 of the 15 countries in this region are on the OECD list of countries eligible for Official Development Assistance.
Source: United Nations Source: World Bank Source: OECD 8. Performance targets
The scale of our work
Over the next two years we will continue to increase the number of people we work with, whilst ensuring that the quality of our work and the impact it creates remain high.
Who we work with
We target three main groups of people overseas and in the UK:
- Influencers – mid/mature career professionals, educators, artists, scientists, community or business leaders, and policy makers. We often work through these people to reach many more and maximise the impact we make.
- Aspirants – these are generally younger people who are in education, or starting out in their careers. Aspirants may be opinion formers within their own networks and may become influencers.
- Leaders – make up a relatively small proportion of participants, but building long-term relationships with governmental, cultural, educational and civil society leaders is essential to enable discussion on policy change and give us the permission to work with wider groups in many countries.
Ways we work with people
We work with influencers, aspirants and leaders in four main ways:
- Face-to-face – people participating in activity where they come into physical face-to-face contact with others, including: leaders, teachers, exam candidates and teaching centre students.
- Exhibitions, festivals, fairs and performances – people attending exhibitions, live arts performances, arts and education fairs, and festivals.
- Digital – people participating through digital channels: social networks, online learning communities, websites, and mobile devices and applications.
- Broadcast and publications – people participating by watching, listening to or reading British Council produced or co-produced content. Participation in our programmes and activities
| | 2013–14 TARGET | 2014–15 TARGET | |--------------------------|----------------|----------------| | Face-to-face | 11 million | 12 million | | Exhibitions, festivals, fairs and performances | 8 million | 9 million | | Digital users | 90 million | 100 million | | Broadcast and publications | 450 million | 500 million |
The targets above represent growth of approximately ten per cent from 2013–14 to 2014–15.
The impact of our work
We measure impact through an annual survey of the most influential people who have taken part in our programmes and by external evaluations of the larger programmes which we run with, or on behalf of, others.
Our Annual Impact Survey (AIS) is conducted by Ipsos MORI. The results of the survey tell us the percentage of people who report that working with us has had an impact on their professional development and/or their organisation’s development and/or their relationship with and perception of the UK.
Over the next two years of the plan the targets for our Annual Impact Survey are:
**Percentage of participants reporting impact on their:**
- **Professional Development**: 90 per cent
- **Awareness of the UK’s contribution to their field**: 85 per cent
- **Links with the UK**: 80 per cent
- **Organisation’s development**: 80 per cent The quality of our work
We measure the quality of our work in two main ways:
- scores from a customer satisfaction survey distributed at face-to-face events and online
- a net recommendation score which is a measure of the willingness of our participants to recommend others to work with us or to use our services.
Our targets reflect our aim to maintain or improve this quality.
Customer satisfaction
Our customer satisfaction score, from a survey of quarter of a million participants, in 2011–12 was 83. Customer satisfaction scores above 80 are considered by the National Audit Office to be ‘good to excellent’. We aim to maintain this level of performance over the next two years.
**WE AIM TO MAINTAIN OUR CUSTOMER SATISFACTION SCORE IN 2013–14 AND 2014–15 AT:**
83
Net recommendation
The Net Promoter methodology is widely used and allows us to benchmark our scores externally. The net percentage is calculated from advocates minus detractors, according to international benchmarks. Our net recommendation of 58 per cent in 2011–12 was slightly above our then target.
The target for the next two years is to achieve 59 per cent annually. This compares well in industry benchmark reports with highly rated brands such as Apple – hardware at 59 per cent and Tesco – mobile phone services at 47 per cent\*.
**FOR THE NEXT TWO YEARS OUR TARGET NET RECOMMENDATION IS:**
59 PER CENT
\*Source: Satmetrix NPS Benchmarks 2012 Other organisational goals
The Foreign and Commonwealth Office Heads of Mission survey is carried out annually to obtain their view of our performance and provide us with valuable feedback. Our target score for the next two years is 82 which falls into the range of ‘good to excellent’.
**OUR TARGET SCORE FOR THE HEADS OF MISSION SURVEY IS:** 82
Our Diversity Assessment Framework assesses how far what we do reflects the equality and diversity of the UK and the countries in which we work. For 2011–12 we achieved level 7 on our ten-indicator system just short of our target of level 8. The target for 2013–14 and 2014–15 remains at level 8.
**THE TARGET FOR OUR DIVERSITY ASSESSMENT FRAMEWORK IS:** 8
We are implementing a sustainable environmental action plan. In 2011–12 we maintained the International Standard for Environmental Management (ISO14001) in all our UK offices. Overseas, we have an Environmental Framework which uses a five-level scale. In 2011–12 we set a challenging target of all offices achieving level 3 – ‘making a difference’. A total of 39 per cent of our overseas offices achieved this level. For 2012–13 our target remained at 3 for all offices. From 2013–14 we will implement environmental awareness eLearning for all staff and the target rises to level 4.
**FROM 2013–14 THE TARGET SCORE ON OUR ENVIRONMENTAL FRAMEWORK IS:** 4 9. Financial plan
Income
Following the Spending Review Settlement in October 2010, our Foreign and Commonwealth Office (FCO) grant will go down further to £154 million over the next two years:
| FCO GRANT | 2012–13 | 2013–14 | 2014–15 | |-----------|---------|---------|---------| | Resource | 166\* | 157 | 149 | | Capital | 6 | 5 | 5 | | Total | 172 | 162 | 154 |
\*includes additional £1 million for the GREAT campaign
However, over the same period we plan to increase earned income by nearly 30 per cent. Back in 2010–11 FCO grant was 27 per cent of our turnover. By 2014–15, it will be less than 20 per cent.
We are largely on track to meet the ambitious income targets we set ourselves for 2014–15 in previous Corporate Plans, despite the difficult economic environment. We are, however, making some adjustments to targets as follows:
- Examinations income for 2014–15 is being increased by £15 million as the business continues to perform strongly and is supported by new products such as Aplits, a new English test.
- Reducing the teaching income target for 2014–15 by £9 million reflecting economic slowdown in some markets. Our target still represents growth of 33 per cent compared with the 2012–13 forecast.
- Introducing a new category of ‘other paid services’ income which represents new sources of earned income in English and Education and Society from, for example, Services in International Education Marketing. The income target for 2014–15 is £16 million.
- Reducing the contracts income target for 2014–15 by £72 million following detailed business planning and market assessment. The revised target still represents growth of 28 per cent compared with the 2012–13 forecast.
Income targets for 2014–15
- Partnership £60 million
- Contracts £168 million
- Other paid services £16 million
- FCO grant £154 million
- Teaching £236 million
- Exams £278 million Expenditure
The FCO grant reduction, the likely impact of inflation and exchange rates and the need to maintain our priority work mean that we need to save a further £30 million of grant costs annually by 2014–15, on top of the £40 million cuts and savings already made over the last two years.
We are investing £128 million over the next couple of years to promote business growth, increase our impact, reduce costs and increase the effectiveness of our operating platform and support services. Investment will be almost entirely financed by surpluses from income earning activities.
Our investment programme will include the development of new products and services, upgrade of our technology platform, improvement of financial systems and capability, online payment systems, digital presence and implementation of collaboration relationship management.
Spend on buildings, infrastructure and support staff has gone down from 19 per cent of total cost to 17 per cent over the last two years. It is planned to go down to less than 15 per cent by 2014–15.
We have contributed to the UK’s aid effort through the government grant for many years. Despite the declining government grant, the proportion of our resource grant which we are required to spend as part of the UK government’s aid effort will go up to 64 per cent by 2014–15. The targets we have been set for Overseas Development Assistance will go up from nearly £93 million in 2012–13 to just under £98 million by 2014–15.
### British Council Financial Plan: 2012–13 to 2014–15
(Figures in £ millions)
| | 2012–13 FORECAST | 2013–14 | 2014–15 | AVERAGE ANNUAL GROWTH RATE (PER CENT) | |----------------------|------------------|---------|---------|--------------------------------------| | FCO grant | 172 | 162 | 154 | (5%) | | Teaching | 177 | 210 | 236 | 15% | | Exams | 236 | 261 | 278 | 9% | | Partnership | 41 | 50 | 60 | 21% | | Contracts | 131 | 137 | 168 | 13% | | Other paid services | 0 | 11 | 16 | | | Bank interest | 2 | 2 | 2 | 0% | | **Income** | **759** | **833** | **914** | **10%** | | Contract expenditure | 107 | 115 | 141 | 15% | | Direct costs | 488 | 540 | 579 | 9% | | **Operating costs** | **595** | **655** | **720** | **10%** | | Platform costs | 122 | 129 | 130 | 3% | | **Total costs** | **717** | **784** | **850** | **9%** | | **Gross surplus/(deficit)** | **42** | **49** | **64** | **23%** | | Investments (including capital) | 60 | 56 | 72 | 10% | | Depreciation and other adjustments | 0 | (10) | (10) | | | **Net surplus/(deficit)** | **(18)** | **3** | **2** | | British Council grant and partnership funded Financial Plan: 2012–13 to 2014–15 (Figures in £ millions)
| | 2012–13 FORECAST | 2013–14 | 2014–15 | AVERAGE ANNUAL GROWTH RATE (PER CENT) | |----------------------|------------------|---------|---------|--------------------------------------| | FCO grant | 172 | 162 | 154 | (5%) | | Partnership | 41 | 50 | 60 | 21% | | Contracts | 5 | 2 | 3 | (23%) | | Bank interest | 1 | 1 | 1 | 0% | | **Income** | **219** | **215** | **218** | 0% | | Operating costs | 169 | 172 | 175 | 2% | | Platform costs | 53 | 53 | 50 | (3%) | | **Total costs** | **222** | **225** | **225** | | | **Gross surplus/(deficit)** | **(3)** | **(10)** | **(7)** | 54% | | Investments (including capital) | 12 | 5 | 5 | | | Depreciation and other adjustments | (3) | (5) | (5) | | | Funding from earned income | (12) | (10) | (7) | | | **Net surplus/(deficit)** | **0** | **0** | **0** | |
### British Council earned income Financial Plan: 2012–13 to 2014–15
(Figures in £ millions)
| | 2012–13 FORECAST | 2013–14 | 2014–15 | AVERAGE ANNUAL GROWTH RATE (PER CENT) | |----------------------|------------------|---------|---------|--------------------------------------| | Teaching | 177 | 210 | 236 | 15% | | Exams | 236 | 261 | 278 | 9% | | Contracts | 125 | 135 | 165 | 15% | | Other paid services | 0 | 11 | 16 | 0% | | Bank interest | 2 | 1 | 1 | (29%) | | **Income** | **540** | **618** | **696** | **14%** | | Contract expenditure | 103 | 113 | 139 | 16% | | Direct costs | 323 | 370 | 407 | 12% | | **Operating costs** | **426** | **483** | **546** | **13%** | | Platform costs | 70 | 76 | 79 | 6% | | **Total costs** | **496** | **559** | **625** | **12%** | | Gross surplus/(deficit) | 44 | 59 | 71 | 27% | | Investments (including capital) | 48 | 51 | 67 | 18% | | Depreciation and other adjustments | 3 | (5) | (5) | | | **Net surplus/(deficit)** | **(7)** | **13** | **9** | |
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9651214c95d5f6c614a8548713b2b1e42f841ef1 | Requests where the cost of compliance exceeds the appropriate limit
Freedom of Information Act
Contents
Overview..................................................................................................................2 What FOIA says about section 12 .................................................................3 The appropriate limit .........................................................................................4 Estimating the costs of complying with a request ........................................4 Staff time ........................................................................................................4 Costs other than staff time ...........................................................................5 A reasonable estimate.......................................................................................7 ‘Sensible and realistic’ ..................................................................................7 Estimates and searches .................................................................................8 Estimates and sampling exercises ..............................................................9 Providing ‘cogent evidence’ .........................................................................9 Example.............................................................................................................11 Aggregation of requests ..................................................................................12 ‘Two or more requests’ ..............................................................................13 ‘Same or similar information’ ..................................................................13 ‘Requests received within 60 consecutive working days’ .......................13 Time at which to apply section 12.................................................................14 Time at which to apply section 12 for aggregated requests ......................14 The ‘neither confirm nor deny’ provision under section 12 .......................15 What FOIA says about advice and assistance under section 16..............16 How to satisfy the requirements under section 16 ....................................18 Indicate that no information can be provided within the appropriate limit..................................................................................................................18 Indicate what information can be provided within the appropriate limit..................................................................................................................18 Failure to provide advice and assistance ....................................................19 More information.............................................................................................20
1. The Freedom of Information Act 2000 (FOIA) gives rights of public access to information held by public authorities.
2. An overview of the main provisions of the FOIA can be found in the Guide to freedom of information.
3. This is part of a series of guidance, which goes into more detail than the Guide to freedom of information to help public authorities to fully understand their obligations, and to promote good practice.
4. This guidance explains to public authorities how to calculate the costs of complying with a request and what they should do if costs would exceed the appropriate limit to comply with the request.
Overview
Section 12 of FOIA allows a public authority to refuse to deal with a request where it estimates that it would exceed the appropriate limit to:
- either comply with the request in its entirety or;
- confirm or deny whether the requested information is held.
The estimate must be reasonable in the circumstances of the case.
The appropriate limit is currently £600 for central government and £450 for all other public authorities.
Where a public authority claims that section 12 is engaged, it should, where reasonable, provide advice and assistance to help the requestor to refine the request so that it can be dealt with under the appropriate limit. What FOIA says about section 12
Section 12(1) – (4) are as follows:
12. — (1) Section 1(1) does not oblige a public authority to comply with a request for information if the authority estimates that the cost of complying with the request would exceed the appropriate limit.
(2) Subsection (1) does not exempt the public authority from its obligation to comply with paragraph (a) of section 1(1) unless the estimated cost of complying with that paragraph alone would exceed the appropriate limit.
(3) In subsections (1) and (2) “the appropriate limit” means such amount as may be prescribed, and different amounts may be prescribed in relation to different cases.
(4) The Secretary of State may by regulations provide that, in such circumstances as may be prescribed, where two or more requests for information are made to a public authority-
(a) by one person, or (b) by different persons who appear to the public authority to be acting in concert or in pursuance of a campaign,
the estimated cost of complying with any of the requests is to be taken to be the estimated total cost of complying with all of them.
5. Section 12(1) of the FOIA is a provision which allows a public authority to refuse to comply with a request for information where the cost of compliance is estimated to exceed a set limit known as the appropriate limit.
6. The relevant Regulations which define the appropriate limit for section 12 purposes are The Freedom of Information and Data Protection (Appropriate Limit and Fees) Regulation 2004 SI 2004 No 3244. These are known as the ‘Fees Regulations’ for brevity. The appropriate limit
7. Regulation 3 of the Fees Regulations states that the appropriate limit for central government, legislative bodies and the armed forces (in other words, those bodies covered by Part 1 of Schedule 1 of the Act) is £600.
8. For all other public authorities, the appropriate limit is £450.
Estimating the costs of complying with a request
9. Regulation 4(3) of the Fees Regulations states that a public authority can only take into account the costs it reasonably expects to incur in carrying out the following permitted activities in complying with the request:
- determining whether the information is held;
- locating the information, or a document containing it;
- retrieving the information, or a document containing it; and
- extracting the information from a document containing it.
10. All public authorities should calculate the time spent on the permitted activities at the flat rate of £25 per person, per hour.
11. This means that the appropriate limit will be exceeded if it would require more than 24 hours work for central government, legislative bodies and the armed forces, and 18 hours work for all other public authorities.
Staff time
12. It is likely that any estimate will be largely or completely made up of the costs of staff time in carrying out the permitted activities.
13. A public authority should note that even if it uses contract or external staff to carry out some or all of the permitted activities, it can only include their time at the rate of £25 per hour irrespective of the actual cost charged or incurred.
14. However, a public authority cannot include the staff time taken, or likely to be taken, in considering whether any exemptions apply in the costs estimate as this activity does not fall within the list of permitted activities.
15. Also, the staff time taken, or likely to be taken, in removing any exempt information in order to leave the information that is to be disclosed, often referred to as ‘redaction’, cannot be included as part of the costs of extracting the requested information.
16. This approach has been confirmed by the Information Tribunal in the case of The Chief Constable of South Yorkshire Police v the Information Commissioner (EA/2009/0029, 14 December 2009) and also by the High Court on appeal ([2011] EWHC44 (Admin)).
17. Additional guidance is also available if you need further information on:
- redacting information ⇒ see “What if we are withholding only parts of a document”
**Costs other than staff time**
18. Sometimes, a public authority may expect to incur costs other than those relating to staff time when carrying out the permitted activities. The key to deciding whether or not these costs can be included in the estimate is whether it would be reasonable to include those charges.
19. For example, if a public authority is able to evidence that its existing software is unable to do the job but that it could purchase other specialist software which would allow the requested information to be retrieved, then the full costs of purchasing that specialist software could be reasonably included in the estimate. In such cases, the Commissioner would require sight of the estimates of any proposed purchase if a complaint were made to him.
20. If a public authority uses off-site storage, it will depend on the terms of the contact between the public authority and the contractor as to whether the costs of locating, retrieving and transporting the information from deep storage can be included in the estimate. Public authorities should note that the Commissioner may want to see the contract in order to be satisfied that such costs can be correctly included.
**Example** A council has a contract with its storage company which provides scheduled six weekly delivery runs without any extra cost. Therefore, if the requested information is retrieved on a scheduled delivery run, then the cost of retrieving the requested information from the deep storage facility is not an additional cost and cannot be included in the estimate.
However, if the delivery run is scheduled to take place after the date for compliance with the request, the public authority would be in breach of section 10(1) of the Act if it waited for the scheduled delivery run. If a public authority is able to comply with the time limit by arranging a special delivery, the Commissioner is likely to accept that it is reasonable to include the actual additional costs of the special delivery in the estimate.
**Example** A public authority instructs its contractors to retrieve five documents – four documents are required for its own business purposes and one document is required in order to answer a freedom of information request. The contract sets out a standard fee of £50 for the retrieval of up to 10 documents on any one visit.
The public authority would only be able to include the costs of retrieving the document required for FOI purposes and therefore should only include a fee of £10 in the estimate. A reasonable estimate
21. A public authority does not have to make a precise calculation of the costs of complying with a request; instead only an estimate is required. However, it must be a reasonable estimate.
22. What amounts to a reasonable estimate can only be considered on a case by case basis. However, the Information Tribunal in the case of Randall v Information Commissioner and Medicines and Healthcare Products Regulatory Agency (EA/2006/0004, 30 October 2007) said that a reasonable estimate is one that is "...sensible, realistic and supported by cogent evidence".
'Sensible and realistic'
23. A sensible and realistic estimate is one which is based on the specific circumstances of the case. In other words, it should not be based on general assumptions, for example, that all records would need to be searched in order to obtain the requested information when it is likely that staff in the relevant department would know where the requested information is stored.
24. This does not mean that a public authority has to consider every possible means of obtaining the information in order to produce a reasonable estimate. However, an estimate is unlikely to be reasonable where an authority has failed to consider an absolutely obvious and quick means of locating, retrieving or extracting the information.
25. A realistic estimate is one based on the time it would take to obtain the requested information from the relevant records or files as they existed at the time of the request, or up to the date for statutory compliance with the request.
26. For example, if the requested information is only contained within paper files at the time of the request, then it is realistic to accept that it would take longer to search paper files than to search the same information if it were stored electronically.
27. Similarly, it is realistic to accept that it will take longer to find the requested information where the relevant records are poorly organised or filed (albeit that this may mean the public authority needs to address any records management issues in accordance with section 46 of the Act).
Estimates and searches
28. A public authority is not obliged to search for, or compile some of the requested information before refusing a request that it estimates will exceed the appropriate limit. Instead, it can rely on having cogent arguments and/or evidence in support of the reasonableness of its estimate. It is good practice to give these arguments or evidence to the requestor at the outset to help them understand why the request has been refused. This reasoning is also likely to be required if a complaint is made to the Information Commissioner.
29. However, it is likely that a public authority will sometimes carry out some initial searches before deciding to claim section 12. This is because it may only become apparent that section 12 is engaged once some work in attempting to comply with the request has been undertaken.
30. If a public authority does carry out some searches, it may wish to bear in mind the following points:
- If a public authority starts to carry out some searches without an initial estimate, it can stop searching as soon as it realises that it would exceed the appropriate limit to fully comply with the request.
- A public authority is not obliged to search up to the appropriate limit.
- If a public authority initially estimates that it could complete its searches under the appropriate limit, but then finds that it cannot, it can stop searching once it reaches that limit. This is because it is not obliged to continue searching just because it originally estimated that the searches could be completed within the appropriate limit.
This was confirmed by the Information Tribunal in the case of Quinn v Information Commissioner and the Home Office (EA/2006/0010, 15 November 2006). 31. A public authority may search up to or even beyond the appropriate limit of its own volition. Also, if a requestor asks a public authority to search up to or beyond the appropriate limit and the public authority is willing, then it can do so.
32. As a matter of good practice, public authorities should avoid providing the information found as a result of its searching and claiming section 12 for the remainder of the information. It is accepted that this is often done with the intention of being helpful but it ultimately denies the requestor the right to express a preference as to which part or parts of the request they may wish to receive which can be provided under the appropriate limit.
33. In practice, as soon as a public authority becomes aware that it intends to rely on section 12, it makes sense for it to stop searching for the requested information and inform the complainant. This avoids any further and unnecessary work for the public authority as it does not need to provide any information at all if section 12 is engaged.
Estimates and sampling exercises
34. A public authority may also choose to support its claim of section 12 by providing evidence of the random or representative sampling exercise it has carried out.
35. For example, in cases where the public authority holds a large number of files of varying sizes, it may be useful to choose a random selection of those files in order to calculate an average for the time it would take to locate, retrieve and extract the relevant information.
36. Alternatively, it may be useful to pick a representative sample of files or records which fall within the scope of the request to demonstrate the application of section 12. For example, one file from each of the years referred to in the request or one file from each relevant department.
Providing ‘cogent evidence’ 37. It is useful if a public authority explains how it has calculated its estimate by explaining:
- its search strategy, for example:
- whether it has carried out any searches for the requested information;
- whether it has based its estimate on a random or representative sampling exercise;
- which departments or members of staff have been contacted;
- the search terms used when querying electronic records;
- why it needs to search the files/records it has referred to;
- how the information is stored, for example, whether the information is held in paper or electronic files;
- how many files, boxes, documents, records or emails need to be reviewed and;
- how long it would take to determine whether the requested information is held or to locate, retrieve and extract it. For example, it is useful to detail the size of the relevant files; the average length of time it would take to review each file and the number of staff required.
38. It is not a statutory requirement to explain how the estimate has been calculated but it is beneficial to a public authority to do so for the following reasons:
- to enable the requestor to assess the reasonableness of the estimate. This may help to prevent a complaint to the ICO which will avoid further time and costs being expended on the same request;
- if a complaint is made to the Information Commissioner, then he will expect the level of detail, as set out above, to be provided. This may require the public authority to incur further costs in providing this detail. This task may also be complicated by changes in circumstances between the time of the request and the time of the ICO investigation; • in any event, providing a suitable breakdown is likely to be required as part of a public authority’s statutory obligations under section 16 to provide advice and assistance (for more detail see the relevant content below).
Example
A public authority receives a request for all expenses claims submitted by two employees over a 10 year period.
**Good practice**
- Consider a search strategy at the outset
The FOI officer considers who would be the most appropriate member of staff to speak to about where to start the search. The FOI officer considers contacting the relevant employees but one has recently retired and the other is on holiday until after the time for compliance with the request. The FOI officer decides to contact a member of the Finance team.
The Finance Executive advises that information relating to expense claims over four years old is stored in archived paper files off-site, whilst claims for the last four years are stored electronically. The electronic expenses files are not stored by employee name but in date order. It is estimated that it would take 5 seconds to open each claim and check whether it related to the one of the employees referred to in the request. The total estimate is approximately 1 hour 23 minutes (5 seconds x 1,000 claims).
The FOI officer then speaks to a colleague who deals with archiving. The relevant Administration Support employee advises that archived records are filed in date order. He suggests that there is an average of 10 accounts files per year of varying sizes. He advises that it would take one hour to search one file to find any relevant expenses forms for the two employees. Accordingly, he estimates that it would take approximately 60 hours to search these files (10 files per year x 6 years @ one hour per file).
- Apply section 12 as soon as the public authority realises it intends to rely on this provision.
At this point, the public authority claims section 12 and provides the requestor with the above breakdown. This allows the requestor to understand what information could realistically be provided under the appropriate limit and make a refined request for the information they are most interested in.
**Undesirable practice**
The public authority decides that it can provide the expenses information for the last four years under the appropriate limit from its electronic records; it discloses this information and refuses the rest of the request under section 12.
This is undesirable practice because it assumes that the requestor would rather have the information in the electronic records than receive a more limited amount of the older information held in the paper files, this assumption may be incorrect.
**Aggregation of requests**
39. When a public authority is estimating whether the appropriate limit is likely to be exceeded, it can include the costs of complying with two or more requests if the conditions laid out in regulation 5 of the Fees Regulations can be satisfied. Those conditions require the requests to be:
- made by one person, or by different persons who appear to the public authority to be acting in concert or in pursuance of a campaign;
- made for the same or similar information; and
- received by the public authority within any period of 60 consecutive working days.
40. Public authorities should note at the outset that requests which clearly fall under different regimes, for example, the Freedom of Information Act, the Environmental Information Regulations or the Data Protection Act, cannot be aggregated.
For more details, please refer to the following guidance:
- Calculating costs where a request spans different access regimes
‘Two or more requests’
41. Public authorities can aggregate two or more separate requests.
42. They should also note that multiple requests within a single item of correspondence are separate requests for the purpose of section 12. This was confirmed by the Information Tribunal in the case of Ian Fitzsimmons v ICO & Department for Culture, Media and Sport (EA/2007/0124, 17 June 2008).
43. Therefore a public authority should ensure that each request can be aggregated in accordance with the conditions laid out in the Fees Regulations. Any unrelated requests should be dealt with separately for the purposes of determining whether the appropriate limit is exceeded.
‘Same or similar information’
44. Regulation 5(2) of the Fees Regulations requires that the requests which are to be aggregated relate "to any extent" to the same or similar information. This is quite a wide test but public authorities should still ensure that the requests meet this requirement.
45. A public authority needs to consider each case on its own facts but requests are likely to relate to the same or similar information where, for example, the requestor has expressly linked the requests, or where there is an overarching theme or common thread running between the requests in terms of the nature of the information that has been requested.
‘Requests received within 60 consecutive working days’ 46. The Fees Regulations state that requests received within 60 consecutive working days can be aggregated.
**Time at which to apply section 12**
47. A public authority should consider whether it would exceed the appropriate limit to comply with the request based on the circumstances as they existed either on the day on which the request is deemed to be received, or on any day up to the time for statutory compliance.
**Time at which to apply section 12 for aggregated requests**
48. Where a public authority wishes to aggregate the costs of dealing with more than one request, it is noted that the Fees Regulations do not cover how to reconcile the ability to aggregate requests received over 60 consecutive working days with the public authority’s obligation to respond to requests within 20 working days as required by section 10(1) of the Act.
49. The Commissioner’s approach is to allow the aggregation period to only run up to 20 days ‘forward’ from the date of any single request under consideration to take into account the requirements of section 10(1).
50. The aggregation period will however be able to run up to 60 days ‘backwards’ from the date of any single request under consideration.
51. The total aggregation period, (running either forwards or backwards or a combination of both) from the date of any single request must not exceed 60 working days.
**Example 1**
A public authority receives a request on 1 September. The public authority also receives requests from the same requestor on the same subject matter on 14, 18 and 21 September. The public authority estimates that the cost of complying with all four requests would exceed the appropriate limit.
Outcome: As the public authority has until 29 September to comply with the request of 1 September; it is able to include the costs of responding to the other three requests when refusing this request. This is because these later requests were all received within the period 20 days ‘forward’ from 1 September.
**Example 2** In the same scenario, the public authority had also already received the following requests:-
9 June (in respect of which it issued a refusal notice claiming section 43) and; 18 August (in respect of which it disclosed all relevant information).
The authority can include the costs of dealing with the request of 18 August when refusing the requests of 1, 14, 18 and 21 September. This is because it was received within the period 40 days ‘back’ from 1 September. As the other requests were received within the period 20 days ‘forward’ from 1 September, the total aggregation period does not exceed 60 days.
The authority could not however include the costs of dealing with the 9 June request as this was received outside the period 40 days ‘back’ from the request of 1 September.
______________________________________________________________________
**The ‘neither confirm nor deny’ provision under section 12**
52. If a public authority estimates that it would exceed the appropriate limit to confirm whether or not the requested information is held then, under section 12(2) of the Act, it does not have to deal with the substance of the request.
53. If a public authority knows that it does hold the requested information it should confirm this to the requestor even if it estimates that it would exceed the appropriate limit to comply with a request. It does not, however, have to comply with the request.
54. In either scenario, a public authority needs to provide a refusal notice stating the fact of its reliance on section 12.
55. As indicated earlier in this guidance, it is not a statutory requirement to provide a breakdown of how the estimate has been calculated but it is useful to do so for a number of reasons. One such reason is that it is likely to be required as part of the work involved in meeting a public authority’s section 16 duties to provide advice and assistance.
What FOIA says about advice and assistance under section 16
Section 16(1) – (2) states as follows:
16. — (1) It shall be the duty of a public authority to provide advice and assistance, so far as it would be reasonable to expect the authority to do so, to persons who propose to make, or have made, requests for information to it.
(2) Any public authority which, in relation to the provision of advice or assistance in any case, conforms with the code of practice under section 45 is to be taken to comply with the duty imposed by subsection (1) in relation to that case.
56. Paragraph 14 of the section 45 Code of Practice states that where a public authority is not obliged to comply with a request because it would exceed the appropriate limit to do so, then it:
"...should consider providing an indication of what, if any, information could be provided within the cost ceiling. The authority should also consider advising the applicant that by reforming or re-focussing their request, information may be able to be supplied for a lower, or no, fee."
Requests where the cost of compliance exceeds the appropriate limit 20150909 Version: 1.2 57. Where a public authority has satisfied the requirements of the section 45 Code of Practice; it will be deemed to have complied with section 16. Although this should not be taken to mean that a public authority should not go beyond the provisions of the Code as public authorities should try to be as helpful and flexible as possible.
58. Public authorities should also note however that the duty to provide assistance and advice under section 16 is expressly qualified by the words "only in so far as it would be reasonable to expect the authority to do so." This suggests that although compliance with the section 45 code is likely to mean the public authority has complied with section 16; it does necessarily mean that a failure to meet the requirements of the Code will inevitably lead to a breach of section 16 if it was not reasonable to provide advice and assistance.
Example Ofcom (FS50203058, 21 December 2009) The requestor made a series of requests regarding the number of complaints received from viewers/listeners which were deemed not to have broken any broadcasting code and which were subsequently overturned on review.
Ofcom confirmed that it would need to examine 78,000 complaints cases in order to answer the request. Based on a sampling exercise, Ofcom estimated that it would take approximately 9,750 hours to review all cases at a cost of £243,750.00. Ofcom claimed section 12 and did not provide any advice and assistance.
Outcome: The Commissioner upheld Ofcom’s section 12 claim. The Commissioner also accepted that given the scope of the request and the way in which Ofcom held the information; it could not offer any meaningful advice as to how to refine the request. Accordingly, the only advice and assistance which could be offered would be to say that no information could be provided under the appropriate limit. How to satisfy the requirements under section 16
59. In cases where it is reasonable to provide advice and assistance in the particular circumstances of the case, the minimum a public authority should do in order to satisfy section 16 is:
- either indicate if it is not able to provide any information at all within the appropriate limit; or
- provide an indication of what information could be provided within the appropriate limit; and
- provide advice and assistance to enable the requestor to make a refined request.
Indicate that no information can be provided within the appropriate limit
60. There is likely to be a breach of section 16 where a public authority has failed to indicate that it is unable to provide any information within the appropriate limit. This is based on a plain English interpretation of the phrase "...what, if any, information could be provided..."
61. In any event, it is useful to inform the requestor of this as it may avoid further and futile attempts to refine the request to bring it under the appropriate limit. Also, if the requestor understands the way in which the estimate has been calculated to exceed the appropriate limit, it should help them decide what to do next. For example, if the requestor accepts that the estimate is reasonable then they may decide to refocus their request in another direction. However, if they believe the estimate is not reasonable, then they may decide to appeal against the refusal instead.
Indicate what information can be provided within the appropriate limit
62. A public authority should inform the requestor of what information can be provided within the appropriate limit. This is important for two reasons: firstly, because a failure to do so may result in a breach of section 16. Secondly, because doing so is more useful than just advising the requestor to ‘narrow’ the request or be more specific in focus. Advising requestors to narrow their requests without indicating what information a public authority is able to provide within the limit, will often just result in requestors making new requests that still exceed the appropriate limit.
**Example**
Northampton General Hospitals NHS Trust (FS50210439, 17 August 2009)
The requestor sought copies of all job evaluations which took place during a period of 8 months and 3 days. The public authority claimed section 12 and claimed that it could not offer any advice and assistance to reduce the costs of complying with the request.
Outcome: The Commissioner upheld the application of section 12.
However, the Commissioner found the Trust had breached section 16 for failing to provide advice and assistance, for example, by suggesting that the requestor could refine the request to only cover specific departments or only job evaluations post September 2008 when the Trust centralised its records on an electronic database.
**Failure to provide advice and assistance**
63. The Information Tribunal in the case of Alasdair Roberts and the Information Commissioner (EA/2008/0050, 4 December 2008) confirmed that a failure to provide advice and assistance does not invalidate the original costs estimate. Although, such a failure may of course mean that the public authority has breached section 16.
64. The Commissioner considers that the implication of the original estimate remaining valid is that the refined request becomes a new request. This means that the statutory time for compliance commences on the date of the receipt of that new request.
65. However, public authorities should note that the original and refined/new requests should not be aggregated for the purposes of calculating the costs of dealing with the new request as to do so would frustrate the purposes behind sections 12 and 16.
66. Additional guidance is also available if you need further information on:
- The fees that may be charged where the cost of compliance does or does not exceed the appropriate limit ⇒ see: Fees that may be charged where the cost of compliance exceeds the costs limit. ⇒ see: Fees that may be charged where the cost of compliance does not exceed the costs limit.
More information
67. This guidance will be reviewed and considered from time to time in line with new decisions of the Information Commissioner, Tribunals and courts.
68. It is a guide to our general recommended approach, although individual cases will always be decided on the basis of their particular circumstances.
69. If you need any more information about this or any other aspect of freedom of information or data protection, please Contact us: see our website www.ico.org.uk
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e5bac5fc25c8bb0c919c22c68a4ef484dc037375 | Cost per passenger processed at the border
| | 2010-11 | 2011-12 | 2012-13³ | |------------------|-------------|-------------|------------| | Costs¹ | £332,093,000| 304,987,000 | £303,974,000| | Number of passengers² | 102,073,000 | 106,216,000 | 106,441,000 | | Cost per passenger| £3.25 | £2.90 | £2.85 |
**Footnotes**
1 Costs associated with passenger processed at the border have been estimated using a full cost allocation model in which unit costs are calculated according to standard accountancy practices. Figures have been rounded to the nearest 1,000.
2 The number of passengers processed is a provisional estimate using a range of sources and include all persons entering the UK. The data are of the number of journeys made; a person who makes more than one journey is counted on each occasion. Figures have been rounded to the nearest 1,000.
3 In 2012/13 there was an improvement in the methodology for allocating staff time between passengers and detection activity, using newly available data on actual time spent rather than planned. This means a year on year direct comparison is not appropriate.
All figures quoted are management information which have been subject to internal quality checks. The numbers may differ from figures released as National Statistics in the Home Office Immigration Statistics as they are drawn from different snapshots of the UK Border Agency databases.
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9de1ecdd57ba8c9bdcb54cc0a4e5aba04fd38483 | | Product Code | Product Description | Unit | 2006 Quantity | 2007 Quantity | |--------------|---------------------|------|---------------|---------------| | 1.1.C | ROUNDWOOD, INCLUDING WOOD FOR CHARCOAL | 1000 m³ | 317 | 459 | | 1.1.NC | Non-Coniferous | 1000 m³ | 98 | 196 | | 1.2 | INDUSTRIAL ROUNDWOOD (WOOD IN THE ROUGH) | 1000 m³ | 8,113 | 8,559 | | 1.2.C | Coniferous | 1000 m³ | 7,949 | 8,436 | | 1.2.NC | Non-Coniferous | 1000 m³ | 164 | 123 | | 1.2.1 | SAWLOGS AND VENEER LOGS | 1000 m³ | 5,313 | 5,715 | | 1.2.1.C | Coniferous | 1000 m³ | 5,257 | 5,657 | | 1.2.1.NC | Non-Coniferous | 1000 m³ | 56 | 58 | | 1.2.2 | PULPWOOD (ROUND & SPLIT) | 1000 m³ | 2,369 | 2,396 | | 1.2.2.C | Coniferous | 1000 m³ | 2,309 | 2,379 | | 1.2.2.NC | Non-Coniferous | 1000 m³ | 60 | 17 | | 1.2.3 | OTHER INDUSTRIAL ROUNDWOOD | 1000 m³ | 431 | 446 | | 1.2.3.C | Coniferous | 1000 m³ | 383 | 400 | | 1.2.3.NC | Non-Coniferous | 1000 m³ | 48 | 48 | | 2 | WOOD CHARCOAL | 1000 mt | 5 | 5 | | 3 | WOOD CHIPS AND PARTICLES | 1000 m³ | 1,831 | 1,948 | | 4 | WOOD RESIDUES | 1000 m³ | 610 | 649 | | 5 | SAWNWOOD | 1000 m³ | 2,807 | 3,146 | | 5.C | Coniferous | 1000 m³ | 2,862 | 3,100 | | 5.NC | Non-Coniferous | 1000 m³ | 45 | 45 | | 5.NC.T | of which:Tropical | 1000 m³ | 45 | 45 | | 6 | WOOD-BASED PANELS | 1000 m³ | 3,498 | 3,549 | | 6.1 | VENEER SHEETS | 1000 m³ | 0 | 0 | | 6.1.C | Coniferous | 1000 m³ | 0 | 0 | | 6.1.NC | Non-Coniferous | 1000 m³ | 0 | 0 | | 6.1.NC.T | of which:Tropical | 1000 m³ | 0 | 0 | | 6.2 | PLYWOOD | 1000 m³ | 0 | 0 | | 6.2.C | Coniferous | 1000 m³ | 0 | 0 | | 6.2.NC | Non-Coniferous | 1000 m³ | 0 | 0 | | 6.2.NC.T | of which:Tropical | 1000 m³ | 0 | 0 | | 6.3 | PARTICLE BOARD, OSB and OTHERS | 1000 m³ | 2,626 | 2,684 | | 6.3.1 | of which:OSB | 1000 m³ | 0 | 0 | | 6.4 | FIBREBOARD | 1000 m³ | 872 | 865 | | 6.4.1 | HARDBOARD | 1000 m³ | 0 | 0 | | 6.4.2 | MDF (MEDIUM DENSITY) | 1000 m³ | 872 | 865 | | 6.4.3 | OTHER FIBREBOARD | 1000 m³ | 0 | 0 | | 7 | WOOD PULP | 1000 mt | 287 | 287 | | 7.1 | MECHANICAL | 1000 mt | 287 | 287 | | 7.2 | SEMI-CHEMICAL | 1000 mt | 0 | 0 | | 7.3 | CHEMICAL | 1000 mt | 0 | 0 | | 7.3.1 | SULPHATE UNBLEACHED | 1000 mt | 0 | 0 | | 7.3.2 | SULPHATE BLEACHED | 1000 mt | 0 | 0 | | 7.3.3 | SULPHITE UNBLEACHED | 1000 mt | 0 | 0 | | 7.3.4 | SULPHITE BLEACHED | 1000 mt | 0 | 0 | | 7.4 | DISSOLVING GRADES | 1000 mt | 0 | 0 | | 8 | OTHER PULP | 1000 mt | 3,546 | 3,440 | | 8.1 | PULP FROM FIBRES OTHER THAN WOOD | 1000 mt | 0 | 0 | | 8.2 | RECOVERED FIBRE PULP | 1000 mt | 3,546 | 3,440 | | 9 | RECOVERED PAPER | 1000 mt | 8,015 | 8,617 | | 10 | PAPER AND PAPERBOARD | 1000 mt | 5,588 | 5,228 | | 10.1 | GRAPHIC PAPERS | 1000 mt | 2,483 | 2,229 | | 10.1.1 | NEWSPRINT | 1000 mt | 1,095 | 1,036 | | 10.1.2 | UNCOATED MECHANICAL | 1000 mt | 572 | 567 | | 10.1.3 | UNCOATED WOODFREE | 1000 mt | 0 | 0 | | 10.1.4 | COATED PAPERS | 1000 mt | 0 | 0 | | 10.2 | SANITARY AND HOUSEHOLD PAPERS | 1000 mt | 805 | 834 | | 10.3 | PACKAGING MATERIALS | 1000 mt | 1,999 | 1,852 | | 10.3.1 | CASE MATERIALS | 1000 mt | 1,532 | 1,402 | | 10.3.2 | CARTONBOARD | 1000 mt | 0 | 0 | | 10.3.3 | WRAPPING PAPERS | 1000 mt | 0 | 0 | | 10.3.4 | OTHER PAPERS MAINLY FOR PACKAGING | 1000 mt | 0 | 0 | | 10.4 | OTHER PAPER AND PAPERBOARD N.E.S. | 1000 mt | 301 | 313 |
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a39e96e1516515676e83cc791df355a63baa911e | Companies determine a method of apportioning between BLAGAB and non-BLAGAB (where required): LAM05000
Detailed rules prescribed for calculating income and chargeable gains LAM02060 (summary); LAM03000 Income and Gains; LAM04000 Expenses
I-E profit split between policyholder share and shareholders share LAM06020
Restriction on offsets: BLAGAB policyholder profit effectively ring fenced: Rules for offset against shareholder profits. See LAM04000
Total I-E profit split between policyholder rate and normal CT rate: LAM06000
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45af59254587d5895a810d5c13223fddb721e1fc | Step 1 Identify income referable to BLAGAB
Step 2 Calculate/identify net chargeable gains referable to BLAGAB
Step 3 Identify additional ‘deemed’ I-E receipts and any minimum profits charge
Step 4 Add results steps 1-3, deduct any non-trading deficit - result is ‘I’ (up to nil)
Step 5 Calculate Adjusted BLAGAB management expenses ‘E’
Step 6 Deduct ‘E’ in step 5 from ‘I’ in step 4
Result is negative = ‘Excess BLAGAB’
Result is positive = ‘I-E profit’
LAM03020: FA12/S74 definition of income LAM05000: allocation of income referable to BLAGAB
LAM03030: FA12/S75 total long-term business chargeable gains: offset of allowable losses LAM05100 apportionment of gains referable to
LAM03300: FA12/S92 - certain receipts included in the calculation of BLAGAB trade profits but not already included at steps 1 or 2. LAM03310: FA12/S93-94 I-E adjustment for minimum profits test
LAM03040: CTA2009/S388 loan relationship and derivative contracts deficit of the deficit period referable to BLAGAB. Allocation to BLAGAB
LAM04010: FA12/S76 steps to calculate adjusted BLAGAB expenses; see FA12/S77-85 for definitions, acquisition expenses, restrictions on deductions, general annuity payments
LAM08000: Excess BLAGAB expenses to be carried forward as an expense to the next accounting period and included in step 5 of S76
LAM02050: FA12/S68 I-E profit charged to tax
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00eef1ea288a6452d12cea1f38662ea2499ea742 | Step 1 Calculate income referable to BLAGAB
LAM03060: FA12/S74 definition of income Principal income sources are generally loan relationships and derivatives taxed as non-trading loan relationships on a mark to market basis and property business profits (property business is taxed as a separate business) Income from equities - dividends mostly exempt
Step 2 Calculate/identify net chargeable gains referable to BLAGAB
LAM03200: FA12/S75 total long-term business chargeable gains as adjusted for allowable losses Realisation basis for equities, property and other investments which are chargeable assets. Annual deemed disposal rules for collective investment vehicles e.g. authorised unit trusts and Open ended investment companies (OEICs), but excluding bond funds LAM03300 Special rules for transfers within the life company between 'boxes' and for transfers to and from a life company within a group LAM03220
Step 3 Identify additional 'deemed' receipts and any minimum profits charge
LAM03500: FA12/S92 - certain receipts included in the calculation of BLAGAB trade profits but not already included at steps 1 or 2. LAM03510: FA12/S93-94 I-E adjustment for minimum profits test
Step 4 Add results of steps 1-3, deduct any non-trading deficit - result is 'I'
LAM03520: CTA09/S388 loan relationship and derivative contracts deficit of the period referable to BLAGAB. Result cannot be negative. After 15 September 2016, the amount of the non-trading deficit that can be deducted is limited to the total of Step 1 plus Step 2 and S92 amount.
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35a528f87f7de46ea571c99a6ed7c9344542630b | ### S86 Separate property businesses
| Not held for long-term business | Held for long-term business | Matched to non-BLAGAB liabilities – e.g. unit-linked life property funds | Matched to non-BLAGAB liabilities – e.g. unit-linked pension property fund | Long-term business property investment not matched to any liabilities - e.g. held in with-profits fund | |--------------------------------|-----------------------------|---------------------------------------------------------------------|---------------------------------------------------------------------|---------------------------------------------------------------------|
- **Net off losses v other BLAGAB profits. S87 Net loss is ‘Deemed BLAGAB management expense’**
- **Allocate between BLAGAB and non-BLAGAB as per Chapter 4**
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384026f6b37a379c71ba509bfe164b23532a28ae | Assets held for long-term business
- Assets matched to BLAGAB liabilities
- CG basis
- Assets matched to other LT liabilities
- Trading basis
- Assets in WPF not matched to LT liabilities
- Assets not in WPF and not matched to LT liabilities
Transfers into or out of these boxes from elsewhere in the company (including LTBFC) or from other group companies are subject to special rules.
Subject to apportionment if liabilities include mix of BLAGAB and non-BLAGAB. May be multiple WPFs.
LTBFC
- Long term business fixed capital not treated as held for long term business
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9dd62f736fef8c2700513d627ea5f34daf20d2b2 | Chargeable gains results subject to apportionment if liabilities include mix of BLAGAB and non-BLAGAB.
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c9bc2dc8de833e531a02d52778d41b85c83f0e03 | Step 1 Calculate Ordinary BLAGAB management expenses
Step 2 Adjust result of step 1 for acquisition expense spreading rules
Step 3 Calculate the amount of any ‘deemed management expenses’
Step 4 Calculate the ‘basic amount’: (Step 1 adjusted for step 2) + Step 3 less expenses reversed and BLAGAB trade loss relieved
Step 5 Add any amounts carried forward from previous accounting period of excess BLAGAB expenses and minimum profits test amounts
Result is adjusted BLAGAB expenses
FA12/S77, S81 and S82 Ordinary BLAGAB management expenses’ referable to the accounting period: based on GAAP compliant accounts, must be ‘expenses of management’, subject to excluded amounts such as claims, reinsurance premiums, other insurance related items and other specific exclusions LAM04020
FA12/S79 spreading of acquisition expenses over 7 years LAM04110 FA12/S80 meaning of acquisition expenses LAM04100
FA12/S78(3) definition of amounts to be treated as if they were management expenses – list includes certain general annuity business annuities, loan relationship surplus deficits carried forward and more. Includes spread acquisition expenses from previous years.
FA12/S78(4) expenses reversed in the accounting period LAM04300.
FA12/S78(5) reduces expenses by any BLAGAB trade loss relieved for the accounting period against other trade profits or surrendered as group relief LAM07310
FA12/S73 Step 6 amount of excess BLAGAB expenses added LAM04400 plus any minimum profits test amounts FA12/S93(5)(b) LAM07230
Steps 1-5 are explained in more detail in the sections indicated above. An example in LAM04400 shows all of steps 1-5 to calculate adjusted BLAGAB expenses
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4a7bab921046847caa145644ffd77d6b11ea5b03 | | Condition 1 | • debited in accounts .....in accordance with generally accepted accounting practice | | Condition 2 | • expenses of management of the company’s long-term business referable to BLAGAB in accordance with s98 (commercial allocation) | | Condition 3 | • not excluded amounts |
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60e3628734763b398dd57af116c4b180892cea44 | | Non-BLAGAB | BLAGAB | |---------------------------------------------------------------------------|------------------------------------------------------------------------| | Life Assurance Business | Life Assurance Business | | Pension | | | ‘New’ Protection | | | Child Trust Fund Business (CTFB) | | | Individual Savings Account Business (ISAB) | | | Overseas Life Assurance Business (OLAB) | | | Life Reinsurance Business (LRB) | | | Immediate Needs Annuity business | | | Permanent Health Insurance (PHI) | | | **Long Term Business** | |
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7d909eb89fec80c061aafa0a61b07e2b40b59896 | | Apportionment rules for I-E charge S97-101 | Trade profit apportionment rules | |-------------------------------------------|----------------------------------| | **INCOME** - Credits and other income. | **GAINS** - Chargeable gains and allowable losses referable to BLAGAB LAM05040 | | **EXPENSES**, debits and other losses and expenses referable to BLAGAB LAM05040 | I-E FA2012/S73 step 2 | | I-E FA2012/S73 steps 1,3,4,&5 | **Trade Profit** - GAAP profit and tax adjustments are to be allocated between BLAGAB and other long-term business (non-BLAGAB) LAM05110 |
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461098c3f8d3db928d31c816e1a1a2ba71b51c7f | Minimum profits charge (FA12/593) £40
Excess BLAGAB expenses (£5)
BLAGAB non-taxable distributions (FA12/594) £15
Net: £55 i.e. after minimum profit test
BLAGAB trade profit (after losses b/f) £50
Net: £10 i.e. before minimum profit test
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a99df5c37799b759915ee2fe2e2a7a849df89a73 | | DATES | DESTINATION | PURPOSE | TRAVEL | OTHER (Including Hospitality Given) | Total Cost £ | |-------------|-------------|----------------------------------------------|--------|-------------------------------------|--------------| | | | | Air | Rail | | | 13.10.11 | Norwich | Official meetings | | £32.00 | £32.00 | | 28.10.11 | Oxford | Institute for New Economic Thinking Conference | | £47.40 | £47.40 | | 03.11.11 | Birmingham | Conference (speaking engagement) | | £22.50 | £22.50 | | 09.11.11 | Oxford | Official meeting (speaking engagement) | | £51.40 | £51.40 | | 25.11.11 – | Oxford | Official meetings | | £48.50 | £48.50 | | 26.11.11 | | | | | | | 01.12.11 – | Edinburgh | Official meetings | £204.69| £32.00 £44.00 £79.00 | £359.69 | | 02.12.11 | | | | | | | 21.12.11 – | Dublin | Official meetings | £301.31| | £83.00 | | 22.12.11 | | | | | £384.31 |
## Hospitality Received
| Date | Organisation Name | Type of Hospitality Received | |------------|--------------------------------------------------------|-----------------------------------------------| | 12.10.11 | Association for Financial Markets in Europe (AFME) | Dinner | | 24.10.11 | The Centre for Economic Performance (CEP) | Lunch | | 25.10.11 | KPMG | Lunch | | 27.10.11 | Russell Group of Universities | Dinner and speaking engagement | | 28.10.11 | Institute for New Economic Thinking | Conference, lunch and reception | | 01.11.11 | LAZARD | Lunch | | 02.11.11 | FDA | Breakfast | | 03.11.11 | Financial Times and Goldman Sachs | Dinner | | 09.11.11 | Keble College | Dinner and speaking engagement | | 11.11.11 | Atlantic Partnership | Breakfast | | 16.11.11 | Reuters Breakingviews | Reception | | 17.11.11 | Bank of America Merrill Lynch | Lunch | | 17.11.11 | National Institute of Economic and Social Research (NIESR) | Reception | | 22.11.11 | Diageo | Lunch | | 25.11.11 – 26.11.11 | Nuffield College | Dinner and accommodation | | 28.11.11 | British Bankers’ Association | Lunch | | 01.12.11 | Scottish Financial Enterprise Board | Dinner | | 05.12.11 | Rothschild | Dinner | | 06.12.11 | Financial Times | Reception | | 20.12.11 | Lord Carter | Lunch | | DATES | DESTINATION | PURPOSE | TRAVEL | OTHER (Including Hospitality Given) | Total Cost £ | |-------------|-------------------|------------------|--------|-------------------------------------|--------------| | 02.10.11-03.10.11 | Zurich | Official meetings | £467.20 | £255.74 | £786.94 | | 17.10.11-18.10.11 | Madrid | Official meetings | £923.30 | £7.01 | £962.31 | | 13.11.11-15.11.11 | Rome | Official meetings | £378.70 | | £378.70 | | 26.11.11-29.11.11 | Washington and Ottawa | Official meetings | £5,766.13 | | £5,766.13 | | 05.12.11-06.12.11 | Luxembourg | Official meetings | £343.50 | | £343.50 | | 11.12.11-14.12.11 | Singapore | Official meetings | £3,830.53 | | £3,830.53 | | 21.12.11-22.12.11 | Dublin | Official meetings | £301.31 | | £301.31 | | Date | Organisation Name | Type of Hospitality Received | |----------|--------------------------------------------------------|------------------------------| | 12.10.11 | Association for Financial Markets in Europe (AFME) | Dinner | | 14.10.11 | National Bank of Kuwait | Lunch | | 17.10.11 | Santander | Dinner | | 18.10.11 | City of London Corporation | Dinner | | 15.11.11 | Inzito Partnership | Reception | | DATES | DESTINATION | PURPOSE | TRAVEL | OTHER (Including Hospitality Given) | Total Cost £ | |---------------|----------------------|--------------------|--------|-------------------------------------|--------------| | 03.10.11 - 04.10.11 | Luxembourg | Official meetings | £656.65 | £40.20 | £205.43 | £902.28 | | 13.10.11 - 15.10.11 | Paris | Official meetings | £605.00 | £488.86 | £1,093.86 | | 20.10.11 - 22.10.11 | Brussels | Official meetings | £334.00 | £23.58 | £356.34 | £713.92 | | 31.10.11 - 04.11.11 | Nice | Official meetings | £837.20 | £105.15 | £942.35 | | 07.11.11 - 09.11.11 | Brussels | Official meetings | £260.00 | £331.76 | £591.76 | | 17.11.11 - 18.11.11 | Brussels | Official meetings | £309.00 | £12.83 | £190.13 | £511.96 | | 24.11.11 - 25.11.11 | Frankfurt | Official meetings | £550.07 | £34.47 | £227.43 | £811.97 | | 29.11.11 - 30.11.11 | Brussels | Official meetings | £430.00 | £430.00 | £430.00 | | 04.12.11 - 08.12.11 | Tokyo, Hong Kong and Singapore | Official meetings | £6,697.73 | £37.65 | £71.07 | £7,050.81 | | 14.12.11 - 16.12.11 | Brussels and Berlin | Official meetings | £666.10 | £157.00 | £89.48 | £211.91 | £1,124.49 | | 21.12.11 - 22.12.11 | Frankfurt | Official meetings | £679.45 | £679.45 | £679.45 |
## Hospitality Received
| Date | Organisation Name | Type of Hospitality Received | |---------|-------------------------------------------------------------|------------------------------| | 11.10.11| TheCityUK | Dinner | | 12.10.11| Association for Financial Markets in Europe (AFME) | Dinner | | 10.11.11| CREST | Lunch | Andrew Hudson – Director General, Public Services, HM Treasury Business Expenses – October-December 2011
| DATES | DESTINATION | PURPOSE | TRAVEL | OTHER (Including Hospitality Given) | Total Cost £ | |---------|-----------------|------------------|--------|-------------------------------------|--------------| | | | | Air | Rail | Taxi/Car | Accommodation/ Meals | | | 28.10.11| Manchester | Official meeting | | | | | £94.50 | | 11.10.11| Edinburgh | Conference | £75.50 | £22.80 | | | £194.30 | | 03.11.11| Birmingham | Conference | £74.50 | | | | £74.50 | | 12.12.11| Gatwick Airport | Official meeting | | | | | £17.90 |
Hospitality Received
| Date | Organisation Name | Type of Hospitality Received | |----------|--------------------------------------------------------|------------------------------| | 11.10.11 | BDO/Society of Local Authority Chief Executives | Dinner |
### Business Expenses – October-December 2011
| DATES | DESTINATION | PURPOSE | TRAVEL | OTHER (Including Hospitality Given) | Total Cost £ | |-------------|-------------|-------------------------------------------------------------------------|--------|-------------------------------------|--------------| | 06.11.11-08.11.11 | Paris | Official meetings | Air: £302.39, Rail: £40.61, Taxi/Car: £31.99 | £374.99 | | 05.12.11 | London | Official meetings (with French Tresor and French Embassy: 14 Officials) | | £402.94 | £402.94 | | 13.12.11 | Scotland | Official meetings | £277.77, Rail: £37.90 | £7.00 | £332.67 |
### Hospitality Received
| Date | Organisation Name | Type of Hospitality Received | |--------------|--------------------------------------------------------|-----------------------------------------------| | 02.11.11 | Bank of America Merrill Lynch | Dinner and speaking engagement | | 06.11.11-08.11.11 | Organisation for Economic Cooperation and Development (OECD) | Lunch | | 21.11.11 | Confederation of British Industry (CBI) | Dinner | | 05.12.11 | Goldman Sachs | Lunch and speaking engagement | | 06.12.11 | HSBC | Lunch | | 06.12.11 | Deutsche Bank | Dinner and speaking engagement | | 09.12.11 | Confederation of British Industry (CBI) | Lunch | Jonathan Taylor – Director General, Financial Services and Stability, HM Treasury Business Expenses – October-December 2011
| DATES | DESTINATION | PURPOSE | TRAVEL | OTHER (Including Hospitality Given) | Total Cost £ | |-------------|-------------|------------------|--------|-------------------------------------|--------------| | 01.12.11-02.12.11 | Edinburgh | Official meetings | £125.42 | £32.00 | £40.00 | £99.00 | £296.42 |
**Hospitality Received**
| Date | Organisation Name | Type of Hospitality Received | |------------|-------------------------------------------|------------------------------| | 04.10.11 | London Metal Exchange | Dinner | | 18.10.11 | Citi | Lunch | | 26.10.11 | GE Corporate | Lunch | | 03.11.11 | Financial Times and Goldman Sachs | Dinner | | 07.11.11 | Nationwide | Lunch | | 07.11.11 | Arbuthnot Banking Group | Reception | | 10.11.11 | Royal Bank of Scotland (RBS) | Lunch | | 29.11.11 | Barclays | Lunch | | 01.12.11 | Scottish Financial Enterprise | Dinner | | 06.12.11 | International Swaps and Derivatives Association (ISDA) | Reception | | 07.12.11 | Standard Life | Reception | | 13.12.11 | Barcap | Lunch | Edward Troup – Director General, Budget, Tax and Welfare, HM Treasury Business Expenses – October-December 2011
No expenses were incurred during this period.
**Hospitality Received**
| Date | Organisation Name | Type of Hospitality Received | |----------|------------------------------------|------------------------------| | 27.10.11 | PricewaterhouseCoopers LLP | Dinner | | 07.11.11 | PricewaterhouseCoopers LLP | Lunch | | 12.12.11 | Institute of Directors | Reception | James Bowler – Director, Strategy, Planning and Budget, HM Treasury Business Expenses – October-December 2011
No expenses were incurred during this period.
**Hospitality Received**
James did not receive any hospitality during this period.
### Alison Cottrell – Corporate Services Director, HM Treasury
### Business Expenses – October-December 2011
| DATES | DESTINATION | PURPOSE | TRAVEL | OTHER (Including Hospitality Given) | Total Cost £ | |---------|-------------|------------------|--------|-------------------------------------|--------------| | | | | Air | Rail | Taxi/Car | Accommodation/Meals | | | 13.10.11| Norwich | Official meetings| £32.00 | £6.00 | | | £38.00 | | 11.11.11| Brussels | Official meetings| £159.00| | | | £159.00 | | 16.11.11| Norwich | Official meetings| £32.00 | £6.00 | | | £38.00 | | 08.12.11| Norwich | Official meetings| £32.00 | £6.00 | | | £38.00 |
**Hospitality Received**
Alison did not receive any hospitality during this period. Julian Kelly – Group Director, Finance and Commercial, HM Treasury Business Expenses – October-December 2011
| DATES | DESTINATION | PURPOSE | TRAVEL | OTHER (Including Hospitality Given) | Total Cost £ | |--------|-------------|------------------|--------|-------------------------------------|--------------| | | | | Air | Rail | Taxi/Car | Accommodation/Meals | | | 13.10.11 | Norwich | Official meetings | £32.00 | £6.00 | | | £38.00 | | 27.10.11 | Exeter | Official meeting | £40.00 | | | | £40.00 | | 03.11.11 | Birmingham | Conference | £96.50 | | | | £96.50 | | 16.11.11 | Norwich | Official meetings | £32.00 | £6.00 | | | £38.00 |
Hospitality Received
| Date | Organisation Name | Type of Hospitality Received | |--------|--------------------------------------------------------|------------------------------| | 20.10.11 | Chartered Institute of Management Accounts (CIMA) | Dinner | | 17.11.11 | Lloyds Bank | Reception |
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0a2a9b7b35aa87a029c8646f69378d9a437e010d | **Box specification**
All new types of packing must be approved by The National Archives before they are used.
**Construction**
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**Context of use**
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**Grades of box board**
There are three grades of board suitable for use at The National Archives. Please consult the table below to determine the grade of board required for your transfer:
| Board Grade | Board Specification | When to use it | |-------------|---------------------|----------------| | Grade 1 Permanent | ✓ 100% chemical pulp\
✓ pH 7.5 – 10\
✓ kappa number should not exceed 5, or else less than 1% lignin content\
✓ alkaline reserve between 2%-10%\
✓ neutral internal sizing (EVA or AKD)\
✓ no optical brighteners\
✓ no plasticisers\
✓ no metal particles, waxes, residual bleach, or other components that could lead to degradation when in immediate contact with the board | Required for boxing materials of high archival or intrinsic value\
Also recommended, but not required, for boxing standard archival records | | Grade 2 Durable | ✓ 100% chemical pulp\
✓ May be laminated\
✓ pH 6.5 – 10 | For boxing standard archival records | Types of box board
- All grades of board are available as two types of board. Please consult the table below to determine the best type of board for your transfer:
| Type of board | Cross section of board | Benefits of use | When to use it | |---------------|-------------------------|-----------------|----------------| | Full board | | * most durable board type | For most transfers full board is preferred | | | | * brass wire stitching increases durability | | | Corrugated board | | * rigid in larger sizes | If boxes are to be stacked in storage | | | | * good for stacking | If records are larger and/or heavier than normal |
- Both full board and corrugated board are available to be delivered flat packed from your supplier. If quantities above 60 standard boxes are required it might be cheaper to order boxes flat packed and assemble them on site.
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57da738b0ab8f5d40fc74aa9d7a2b838daeeb51d | Body Snatchers: ‘The London Burkers’ and the Case of ‘The Italian Boy’ Introduction
Lesson at a Glance
Suitable For: KS3, KS4
Time Period: Empire and Industry 1750-1850
Curriculum Link: Ideas, political power, industry and empire: Britain, 1745-1901
- Crime and Punishment
- Medicine through time
- Frankenstein (English Literature GCSE)
Learning Objective: How common was the crime of Body Snatching? How successful was the Anatomy Act of 1832?
Resources needed: Printed sources
Medical Advances
The early 19th Century saw many advances in science and medicine, in a time where scientific and religious ideas often clashed over what was morally correct. These ideas are explored in nineteenth century literature such as the novel Frankenstein, but the stories in the real world were often as shocking and brutal as the Gothic fantasy. This lesson explores the business of the grave robber and how they furthered the study of medicine through a grey area of the law.
Contents:
Background: ................................................................. 3 Teacher’s notes: .......................................................... 4 Source One: ................................................................. 6 Source Two: ................................................................. 12 Source Three: .............................................................. 17 Source Four: ............................................................... 20 Source Five: ................................................................. 22
This resource was produced using documents from the collections of The National Archives. It can be freely modified and reproduced for use in the classroom only. The study of anatomy had a troubled history. Religion dictated that dissection of human bodies was an offence leading to misunderstandings of human anatomy based on limited evidence. Galen’s writings ‘On Anatomy’ in AD190 built on the theories of Hippocrates’ Four Humours whilst applying observation of living humans and anatomical study of the deceased. As Human dissection was still not allowed outside of Alexandria, he recommended the dissection of animals such as apes and pigs, using his findings to suggest the anatomy of humans. Whilst some aspects of his observations were accurate, the differences between humans and other animals led to many mistakes but his detailed books on anatomy were believed for many hundreds of years before they were questioned. By the 16th Century, Vesalius had proven that more could be learnt through human dissection and the study of our own anatomy, and attitudes towards medicine began to change.
The industrial revolution brought social change, and significant medical advances through scientific enquiry. In an attempt to prevent murder through increasing the severity of punishment, the Government passed the Murder Act 1751 preventing the bodies of executed murderers from being buried. Instead their bodies would be strung up or given to medical science. As a result, medical students had a greater supply of cadavers to study legally than any previous period, and the study of anatomy through public dissection became a major part of the training of doctors and surgeons.
However, the opening of new medical schools and training centres in the 18th Century meant that even this new supply of subjects could not meet the needs of the students. Buried bodies were not considered property and therefore could be exhumed and sold without restriction, though the practice was hated by the general public. Cemeteries and mourners began to take measures against the business, installing gates, cages and mausoleums to protect their interred. Yet the need for bodies created a profitable black market and ‘Resurrectionists’ or body snatchers became commonplace, leading to notorious cases of murder for the sole purpose of selling the victim’s corpse.
This is the background experience inspiring Victor Frankenstein in Mary Shelley’s novel ‘Frankenstein; or, The Modern Prometheus’ which sees an ambitious and driven young medical student turn resurrectionist in his quest to discover a cure for death. Through Victor we see several roles of the medical science of the day, with the position of body snatcher and surgeon in one character whilst his friends and colleagues display the public disgust and conflict within the profession in their shock at the character’s descent into desperation.
The most famous Resurrectionists were Edinburgh’s Burke and Hare but London had its own notorious cases including ‘The London Burkers’ or ‘Bethnal Green Gang’ whose case, alongside several others in the early 1830s would lead to the Anatomy Act of 1832 and the legal recognition of the rights of a corpse.
‘The London Burkers’ trial took place under a media spotlight with the accused changing their story several times following the statements of new witnesses. The Home Office documents presented here provide evidence of their trial at the Old Bailey including the final confessions of two of the accused, describing their involvement in the crime and the business of resurrectionism, and the record of their sentences and punishments from Newgate Prison’s Calendar. Also provided is an extract from the Anatomy Act 1832, passed as a direct result of ‘the Bethnal Green Gang’ murders. The final source provided is a later letter sent to the Home Secretary describing the resulting shortfall in subjects for medical students twenty-five years on. This is one of many letters collected by the Home Office after the Act as the appointed inspectors began to keep closer contact with the schools of anatomy and medical profession. This lesson can be used as part of several fields of study for GCSE, including:
- Crime and Punishment
- History of Medicine
- Social Reform of the early 1800s
- Historical Context of 'Frankenstein' by Mary Shelley.
The confessions of Bishop and May describe their daily lives in great detail. The full confessions are twelve pages long each, and so have been presented as extracts to provide the most relevant sections describing one particular case. The initial task can be completed as group work, in carousel, or individually as its own lesson before moving on to the rest of the sources. Care should be taken in providing the source describing the murder to students.
The final source shows the ongoing effects of the Act over twenty-five years later, asking students to consider these sources in the context of a larger narrative.
Tasks
1. Read the two confessions and answer the provided questions. This activity could work well in two or more groups where one side is given May’s confession and the other is given Bishop’s. Come back together to discuss your findings.
2. Look at the Newgate Prison Calendar.
- What was the sentence at the trial?
- What was Bishop’s punishment?
- What was May’s punishment?
3. Look at the Anatomy Act 1832. This document is written in legal language so can be quite difficult, try to separate it into blocks of information.
- Why did the Act come into force?
- Why is the study of Anatomy necessary?
- What policies are put in place to help prevent further crimes?
- List the people who can now apply for licenses to study anatomy.
4. Read the Letter from the Medical students of Guys Hospital.
- How successful was the Anatomy Act 1832?
- What problems are the Medical Students facing in 1859? Task One - Questions
May's Confession:
Becoming a resurrectionist: What is a resurrectionist? How and why did May become a resurrectionist? Why does he discuss Patrick Murphy? What do the hospitals think of resurrectionists?
Talking to Bishop: Bishop asked May for the ‘best price’ – what does this tell us about the treatment of bodies? How often are they making sales? What does the word ‘bid’ imply?
May’s involvement: How well treated is the body? Why might they sell the teeth separately? Why is it important to arrive before the Friday evening lecture?
Selling the Body: What is May’s main concern at the beginning of the extract? How many times is drinking mentioned? How trustworthy is his account? How responsible is he? Was May expecting the arrest? What do you think May’s crime was?
Bishop’s Confession:
The Murder: Why was the boy vulnerable? How did Bishop and Williams convince him to go with them? What happened to the boy?
Making Plans: Why does Mr Tuson turn down the sale? What does ‘The Lecture Room’ imply about where he is selling the body? How much does Bishop agree to sell the body for?
Selling the Body: Why does Bishop check with May? What was Bishop’s offer to get May involved? What does Mr Partridge demonstrate? Describe May’s behaviour during the sale. How much does Bishop agree to sell the body for?
Declaration: How does Bishop help May? What do you think May’s crime was? How many bodies has Bishop sold during his career as a body snatcher? What does this tell you about the trade? James May now under sentence of death in Newgate.
About six years ago I began the business of resurrectionists. I was then out of a situation and using the Alfred's Head near the Elephant and Castle and several of them used to use it - I got acquainted with them there. One of them asked me to go to Woolwich after a convict that had been buried in the marshes. I agreed to go and went with this person but I don't recollect his name - we got the body and to the best of my recollection sold the body at St Thomas's for 8 Guineas.
Patrick Murphy has become rich by the business beginning from a labourer porter and by means of his money is able to go to the keeper of different grounds and pay them handsomely for the men of the grounds he used to have a man of the name of Richard Field and Joseph Napier with him they used to do the work and he looked out for the grounds and as they term it make a place right - I have been at Hospital grounds but at no others than Thomas's or Guy's. They have a watchman there now a trust worthy one but we can't get over him because I have watched him so narrowly. I have asked him to have something to drink it won't do to give money first but he won't drink with nobody before he came there we had a man there he was right and we could do as we liked - Transcript: Extract – Becoming a resurrectionist
James May now under sentence of Death in Newgate – About six years ago I began the business of resurrectionist. I was then out of a situation and using the Alfred’s Head [pub] near Elephant and Castle and several of them used to use it – I got acquainted with them there- One of them asked me to go to Woolwich after a Convict that had been buried in the marshes. I agreed to go and went with this person but I don’t recall his name – We got the body and to the best of my recollection sold the body at St Thomas’s for 8 Guineas. […]
Patrick Murphy has become rich by the business beginning from a Labourer or Porter and by means of his money is able to go to the Keeper of different grounds and pay them handsomely for the run of the grounds.
He used to have a man of the name of Richard Wilds and Joseph Naples with him they used to do the work and he looked out for the grounds and as they term it made a place right- I have been at Hospital grounds but at no others than Thomas’s or Guys – They have a watch-man there now a trustworthy one but we can’t get over him because I have watched him so narrowly I have asked him to have something to drink it won’t do to give money first but he won’t drink with no body- before he came there we had a man there he was right and we could do as we liked.
Notes:
‘Out of a situation’ – out of work, possibly homeless.
Guinea – A pre-decimalised coin. 1G = £1 1s (or £1.05) Guineas were generally used for professional fees or prices of major goods at this time having been replaced by pounds as the main unit of currency in 1816.
8 Guineas = 42 days wages for a skilled tradesman at the time. Approx. £570 today.
Thomas’s or Guys – Hospitals in London which held public lectures on anatomy for medical students.
Transcript: Extract – May’s involvement
I then asked a man who drove a Chariot whether he would take the job he asked me what it was to do I told him and he said he would – Me and Bishop got into the Chariot and drove to the Fortune of War where the Prisoner – Williams was –
Bishop uncorded a hair trunk which was there and lifted up the lid – I there saw the body it was laying straight on the back with the head in the chest and the hands laying by the side I lifted the upper lip and asked him how it was he did not take the teeth out because it is natural in Young persons to have a good set of Teeth I can’t be positive what he said but I think he said what would you take the teeth out I did not think they were good enough […] I took the teeth out and put the body in the sack and carried to the chariot myself. We all three got in and I desired the coachman to drive to Guys Hospital which he did and we got there as they were getting ready for the Friday Evening Lecture – I took the Body out myself and took it into Mr Davies’. Bishop went with me and we left Williams with the Coachman. I asked Davies to take it and so did Bishop.
Notes:
Chariot – a horse and carriage. Hair trunk – a trunk covered in animal hide with intact hair.
Uncorded – untied Guy’s Hospital – a leading teaching hospital Transcript: Extract – Talking to Bishop
Bishop used to work on this side of the water – he used to live in Shoreditch and until I went to his house this time I did not know where he lived – I met him first at the Fortune of War [pub] – I met him at the Fortune of War on the Friday the 4th of November between 11 and 12 I think as nearly as I can recollect [...]
Bishop asked me where they were giving the best price for things I told him I had sold two the day before I said I had got 10 Guineas for mine and asked him what sort of subject his was (he having told me he had got one) He told me it was fresh and a lad of about 14 Years of age – He said he had been at the west end of the town and had been bid Eight Guineas for it – I told him if it was mine I should take no such money for it – I said if it was mine I could get 10 Guineas for it – he said if I liked I should sell it and all I could get over nine I should have it for myself – I agreed to it.
Notes: 10 Guineas = Equivalent to 52 days wages for a skilled tradesman at the time. Approx. £712 today. Body Snatchers
What led to the Anatomy Act of 1832?
Document: Confession of ‘resurrectionist’ James May 1831 (HO17/46/122) Extract Three: May’s involvement
[Handwritten text]
Bishop uncorked a hair trunk which was there and lifted up the lid. There saw the body laid straight on the back with the head inclining on the chest and the hands laying by the side. Lifted the upper lip and asked him how it was he did not take the teeth out because it is natural in young persons to have a good set of teeth. I can’t be positive what he said but I think he said what would you take the teeth out. I did not think they were gone enough. Took the teeth out and put the body in the sack I carried to the Chariot myself. We all three got in. I desired the Coachman to drive to Guy’s Hospital which he did. We got there as they were getting ready for the Friday Evening Lecture. I took the Body out myself. Took it into Mr. Davis. Bishop went with me. We left Williams with the Coachman. Sake Davis to take it. So did Bishop. Body Snatchers
What led to the Anatomy Act of 1832?
Document: Confession of ‘resurrectionist’ James May 1831 (HO17/46/122)
Extract Four: Selling the body
John took two of you yesterday & that’s more than I know.
What to do with - Bishop then as well as myself asked him to leave it there that night which Mr Davis complied with. Bishop requested Mr Davis not to let any one know it but himself as it belonged to him and requested not to let it go without. I was there as I alone had money out of pocket by which I meant that as I had paid for tea & what we had had to drink & for the Coachman & horse if he had taken the body away himself he might have done me out of the money as well as what portion I might have got by the sale of it.
We went away after I had paid the Coachman & then took another coach in the Bence. I went to the station of your house & some more drink & stopped there sometime. I was then a little elevated & don’t recollect very accurately but I think I went out from there with Bishop & William & had a coach to Golden Lane.
After I had sold the body I went to Mr Davis at the Hospital. Shortly after I had been there the Resinor Bishop & Williams & Shields the Porter came - Williams & Shields we sent to get something to drink & wait our return - Bishop & I then went to Mr Granger. They did not want it & then we went to the King’s College & saw the porter - Bishop agreed for the price. We came back again to Granger for Williams & Shields we then took the body put it in a hamper placed on Shields head & then Mr & Bishop had a cab - Williams went with Shields - we got to the King’s College first & waited for them - there we were taken into Custody. Transcript: Extract – Selling the Body
He declined he said you know John I took two of you yesterday and that’s more than I know what to do with – Bishop then as well as myself asked him to leave it there that night which Mr Davies complied with. Bishop requested Mr Davis not to let any one have it but himself as it belonged to him and I requested not to let it go without I was there as I should be money out of pocket by which I meant that as I had paid for Tea and what we had had to drink and 10 S for the Coachman’s hire if he had taken the Body away himself – he might have done me out of the money as well as what portion I might have got by the sale of it [...]
we went away after I had paid the Coachmen 10 S we then took another coach in the Borough and went to the Fortune of War – had some more drink and stopped there sometime I was then a little elevated and don’t recollect very accurately but I think I went out from there with Bishop and Williams and had a coach to Golden Lane. [...]
After I had sold the teeth I went to Mr Davis at the ~Hospital and shortly after I had been there the Prisoner Bishop and Williams and Shields the porter came – Williams and Shields we sent to get something to drink and wait our return – Bishop and I then went to Mr Graingers and they did not want it and then we went to the King’s College we saw the porter – Bishop agreed for the price and we came back again to Guy’s for Williams and Shields we then took the Body put it in a Hamper and placed on Shields’ Head he had a knot – Me and Bishop had a cab – Williams went with Shields – we got to the Kings College first and waited for them – there we were taken into Custody -. Transcript – Extract One: The Murder
Newgate December 4 1831
I, John Bishop do hereby declare and confess that the boy supposed to be the Italian boy was a Lincolnshire boy- I and Williams took him to my House about ½ past 10 O’Clock on the Thursday night the 3rd of November from the Bell in Smithfield – He walked home with us – Williams promised to give him some work.[…] I took him into the House – we lighted a candle & gave the boy some bread & cheese & after he had eaten, we gave him a cup full of rum with about half a small phial of Laundanum in it.
I then took him in my arms & let him slide from them headlong into the well in the Garden whilst Williams held the cord to prevent his body going altogether too low into the well – he was nearly wholly in the water of the well. Transcript – Extract Two: Making Plans
[...]We had something to eat and drink there [a pub] and after we had been there about half an hour May came in – I knew May, but had not seen him for about a fortnight before – he had some rum with me at the bar.[...]
Leaving May at the Fortune of War – Williams and I went to Mr Tuson’s in Windmill Street where I saw Mr Tuson and offered to sell him a subject – meaning the boy we had left at home – he said he had waited so long for a subject which I had before undertaken to procure that he had been obliged to buy one the day before. We went from there to Mr Capries in Dean Street and offered it to him in the Lecture Room with other Gentlemen. They asked me if it was fresh, I told them yes – they told me to wait – I asked them 10 Guineas and after waiting a little a Gentleman there said they would give 8 Guineas which I agreed to take and engaged to carry it there the next morning at 10 OClock[...] What led to the Anatomy Act of 1832?
Document: Confession of bodysnatcher John Bishop 1831 (HO17/46/122) Extract Three: Selling the Body
I called my boy out to the outside of the house. I asked was the best price — giving for things — he said he had sold two the day before for 10 guineas each (I think). I told him I was a subject. He asked what sort of one. I said a boy about 14 years old. That I had been offered 8 guineas for it. He said if it was his, he would not take it. He could sell it where he sold his for more. Stated him that all he could get above 9 guineas he might have for himself — we agree to go presently to get a coach.
Water in a boat to the King's College where the inquiry of Mr. Hill the Porter if he wanted a subject. He said he was not particularly in want but would speak to Mr. Partridge, the demonstrator. Mr. Partridge came. I asked what the subject was. May said a male subject. Mr. Partridge asked the price. May said 12 guineas. Mr. Partridge said he could not give so much. Vincent away. Mr. Hill asked us to stay a few minutes whilst he went after Mr. Partridge to speak to him again. Hill returned. Said Mr. Partridge would give 9 guineas. May said he would be damned if he should go under 10 guineas. Mess in lieu of the money a little way off took the opportunity of saying to Hill that it should come at 9 guineas. Stold May directly after that. Had sold it for 9 guineas. What I would out of it pay him what I had told him I give him something besides. I declare that this statement is all true and that it contains all the facts as far as I can recollect. I may have nothing to do with the murder and I do not believe he suspected that I had got the body except in the usual way after the death of it. I always told him that I got it from the ground and he never knew to the contrary until I confessed to the bullying since the trial. I have known May as a body snatcher for 5 years but I do not believe he ever obtained a body except in the common way of men in that calling by stealing from the graves.
Before I set forth I never was concerned in obtaining a subject by destruction of the living. I have followed the course of obtaining a livelihood as a body snatcher for 12 years. I have obtained 100 bodies from 500 to 1000 bodies but I declare before God that they were all obtained after death. Vital with the above exceptions I am ignorant of any murder for that or any other purpose. Transcript – Extract Three: Selling the Body
I called May out to the outside of the House and asked was the best price giving for “things” – He said he had sold two the day before for 10 Guineas each (I think) – I told him I had a subject – He asked what sort of one – I said a boy about 14 years old and that I had been offered 8 Guineas for it – He said if it was his he would not take it – he could sell it where he sold his for more – I told him that all he could get above 9 Guineas he might have for himself – we agreed to go presently and get a coach.[…]
[we] crossed the water in a Boar to the Kings College where we inquired of Mr Hill the Porter if he wanted a subject – he said he was not particularly in want but would speak to Mr Partridge, the Demonstrator; - Mr Partridge came and asked what the subject was, May said a male subject Mr Partridge asked the price May said ‘12 Guineas’ – Mr Partridge said he could not give so much and went away – Mr Hill asked us to stay a few minutes whilst he went after Mr Partridge to speak to him again – Hill returned and said Mr Partridge would give 9 Guineas - May said he would be damned if it should go under 10 Guineas - He was in liquor and on his moving a little way off I took the opportunity of saying to Hill that it should come in at 9 Guineas and that I would out of it pay him what I had had of him and give him something besides. […]
Notes: Subject - body
Transcript – Extract Four: Declaration
I declare that this statement is all true and that it contains all the facts as far as I can recollect May knew nothing of the murder and I do not believe he suspected that I had got the body except in the usual way and after the death of it – I always told him that I got it from the ground and he never knew to the contrary until I confessed to Mr Williams since the Trial – I have known May as a Body Snatcher 4 or 5 years but I do not believe he ever obtained a body except in the common way of men in that calling by stealing from the graves –[…]
Until the transactions before set forth I never was concerned in obtaining a subject by destruction of the living – I have followed the cause of obtaining a livelihood as a Body Snatcher for 12 years and I have obtained and sold I think from 500 to 1000 bodies but I declare before God that they were all obtained after death and that with the above exceptions I am ignorant of any murder for that or any other purpose. What led to the Anatomy Act of 1832? **PRISONERS ON ORDERS.**
**MIDDLESEX.**
| NAME | AGE | CONVICTED | NAME | AGE | CONVICTED | |------|-----|-----------|------|-----|-----------| | John Bishop | 33 | Dec. 1831 | John William Butcher | 22 | Dec. 1831 | | Thomas Williams | 26 | " | William Scott | 36 | " | | James May | 39 | " | William Anthony | 18 | " | | John Jones | 27 | " | James Brown | 19 | " | | Samuel Connix | 26 | " | Arthur Poole | 19 | " | | William Bailey | 32 | " | William Gibson | 20 | " | | Deniston Angus | 25 | " | William Williams | 54 | " | | Robert Springett | 17 | " | Maria Dowling | 25 | " | | William Weldon | 27 | " | Mary Elton | 23 | " | | Thomas Perry, alias Williams | 25 | " | " | " | " |
**Rescued and Transported for Life.**
| NAME | DATE | NAME | DATE | |------|------|------|------| | John Harris | 20 April 1829 | Margaret Smith | 18 June 1831 | | George Mc. Lochlin (Penitentiary) | 14 Sept. 1831 | Walburgis Eleire Roulette, alias | " | | Joseph Langley (Hulks) | 19 Oct. 1831 | Christiana Eckardt | 25 Sept. | | George Alfred Gloner | 31 | Elizabeth Baco | 20 | | Emanuell Antonio | 34 | Elizabeth Lee | 20 | | Thomas Davis (Penitentiary) | 18 | Frances Bagley | 24 | | James May (Hulks) | 30 Dec. 1831 | Hannah Jones | 40 | | Anna Hyde (Ship) | 23 June 1831 | Esther Elias | 23 Oct. |
**Rescued, and Confined One Year in the House of Correction.**
| NAME | DATE | NAME | DATE | |------|------|------|------| | John Kybert | 20 | (Removed) | 20 Oct. 1831 |
**Under Sentence of Transportation for Life.**
| NAME | DATE | NAME | DATE | |------|------|------|------| | James Hawkins | 43 | Jan. 1826 | Eliza Jones | 20 Sept. 1831 | | Edward Tyler (Hulks) | 20 | Dec. 1831 | Mary Arnold | 30 | | Robert Folks | 24 | " | Mary Meeking | 31 | | Patrick Bouchell | 34 | " | Henrietta Lathulier | 21 | | James Richardson (Hulks) | 22 | " | Jane Morrison | 24 Oct. | | Catherine Conject (Pardoned) | 55 | Sept. 1827 | Lydia Goodwin | 25 | | Elizabeth Patterson | 42 | Sept. 1828 | Ann Hudson | 22 | | Mary Middleton | 32 | Sept. 1831 | " | " |
### Transcript: Newgate Prison Calendar (HO77/39/32) Extract
| No. | Name. | Age | Trade &c. | By whom & when committed. | Offence charged with. | No. | When Tried. | Before whom. | Verdict. | Sentence. | |-----|------------------------|-----|-----------|---------------------------|----------------------------------------|-----|-------------|--------------|----------|-----------| | 170 | John Bishop | 33 | Labourer | G.R.Minshull, Esq. | The wilful murder of Charles Ferrier | 170 | Dec 2 | Lord Chief Justice Tindale | All Guilty | Death | | | James May | 30 | Butcher | | | | | | | | | | And Thomas Williams | 26 | Bricklayer| | | | | | | | | | Bishop and Williams | | | ditto | The wilful murder of Frances Pickburn. | | | | | | | | - detained | | | | | | | | | |
**Prisoners on Orders.** **Middlesex.** **Under Sentence of Death.**
| Name | Age | Convicted | |-----------------------------|-----|-----------| | John Bishop (Executed) | 33 | Dec. 1831 | | Thomas Williams d[itt]o | 26 | | | James May (Respited) | 30 | |
**Notes:**
- Respited – postponed
- Transported – sent abroad to labour as punishment, often to America or later Australia
- Hulks – Ships used as floating prisons
| Name | Age | Convicted | |-----------------------------|-----|-----------| | James May (Hulks) | 30 | Dec. 1831 | WHEREAS a Knowledge of the Causes and Nature of sundry Diseases which affect the Body, and of the best Methods of treating and curing such Diseases, and of healing and repairing divers Wounds and Injuries to which the Human Frame is liable, cannot be acquired without the Aid of Anatomical Examination: And whereas the legal Supply of Human Bodies for such Anatomical Examination is insufficient fully to provide the Means of such Knowledge: And whereas, in order further to supply Human Bodies for such Purposes, divers great and grievous Crimes have been committed, and lately Murder, for the single Object of selling for such Purposes the Bodies of the Persons so murdered: And whereas therefore it is highly expedient to give Protection, under certain Regulations, to the Study and Practice of Anatomy, and to prevent, as far as may be, such great and grievous Crimes and Murder as aforesaid: Be it therefore enacted by the King's most Excellent Majesty, by and with the Advice and Consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the Authority of the same, That it shall be lawful for His Majesty's Principal Secretary of State for the Time being for the Home Department in that Part of the United Kingdom called Great Britain, and for the Chief Secretary for Ireland in that Part of the United Kingdom called Ireland, immediately on the passing of this Act, or so soon thereafter as may be required, to grant... An Act for regulating Schools of Anatomy [1st August 1832]
I. Whereas a Knowledge of the Causes and Nature of sundry Diseases which affect the Body, and of the best Methods of treating and curing such Diseases, and of healing and repairing divers[e] Wounds and Injuries to which the Human Frame is liable, cannot be acquired without the Aid of Anatomical Examination: And whereas the legal Supply of Human Bodies for such Anatomical Examination is insufficient fully to provide the Means of such Knowledge: And whereas in order further to supply Human Bodies for such Purposes divers[e] great and grievous Crimes have been committed, and lately Murder, for the single Object of selling for such Purposes the Bodies of the Persons so murdered: And whereas therefore it is highly expedient to give Protection, under certain Regulations, to the Study and Practice of Anatomy and to prevent, as far as may be, such great and grievous Crimes and Murder as aforesaid; be it therefore enacted by the King’s most Excellent Majesty,[…] that is shall be lawful for His Majesty’s Principal Secretary of State for the time being for the Home Department […] to grant a Licence to practise Anatomy to any Fellow or Member of any College of Physicians or Surgeons, or to any Graduate or Licentiate in Medicine, or to any Person lawfully qualified to practice Medicine in any part of the United Kingdom, or to any Professor or Teacher of Anatomy, Medicine or Surgery or to any Student attending any School of Anatomy, on Application from such Party for such Purpose, countersigned by Two of His Majesty’s Justices of the Peace acting for the […] Place wherein such Party resides […]
IV. And be it enacted, That every Inspector to be appointed by virtue of this Act shall make Quarterly Return to the said Secretary of State […] of every deceased Person’s Body that during the preceding Quarter has been removed for Anatomical Examination […] distinguishing the Sex, and, as far as is known at the Time, the Name and Age of each Person […]
VII. […] it shall be lawful for any Executor or other Party having lawful Possession of the Body of any decease Person, not being an Undertaker or other Party intrusted with the Body for the Purpose only of Interment, to permit the Body of such deceased Person to undergo Anatomical Examination, unless […] such Person shall have expressed his Desire either in Writing at any Time during his life, or verbally in the Presence of Two or more Witnesses during the Illness whereof he died, that his Body after Death might not undergo such Examination […]
IX. […]in no Case shall the Body of any Person be removed for Anatomical Examination from any Place where such Person may have died until after Forty-eight Hours from the Time of such Person’s Decease, not until after Twenty-Four Hours Notice, to be reckoned from the Time of such decease, to the Inspector of the District, of the intended Removal of the Body[…] nor unless a Certificate stating in what Manner such Person came by his Death shall previously to the Removal of the Body have been signed by the Physician Body Snatchers
What led to the Anatomy Act of 1832?
Document: Letter from Guy’s Hospital Medical Students 1859 (HO 45/6521) Sir!
The various metropolitan medical schools having re-opened for the winter session, the committee appointed in the early part of the year, for the purpose of investigating the causes of the deficient supply of subjects for anatomical purposes, is anxious to present its report.
The schools have of late suffered much from the lamentably inadequate means to study anatomy and await with concern your reply to the address the committee had the honour to present to you in July.
Permit me to take the liberty of asking, whether upon considering the practical suggestions you did us the favour to request of the deputation, it has been possible to adopt any remedial measures or whether it is in contemplation to effect during the next Parliamentary Session an alteration of the law, whereby the means so abundantly available under suitable regulations but now lost may for the future be secured.
I beg in my own behalf and on that of the Committee to apologise for this intrusion, which is solely prompted by our earnest desire to acquit ourselves advantageously of the task imposed by our very numerous fellow students upon us.
I have the honour to remain,
Sir,
Your obedient and humble servant
John Thomas Mercer
Honourable Secretary to the Committee of Medical Students, on the supply of anatomical subjects
The Right Honourable Sir L.C. Lewis. Did you know?
The National Archives Education Service also offers free taught sessions onsite in Kew and online.
You can book a free Virtual Classroom session, an online lesson where students can use individual computers to interact with our Education Officers and explore original documents without needing to travel to The National Archives. You will need computers or tablets for your students to work on either individually or in pairs.
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Our Onsite Workshops are available for free here at The National Archives and allow students to experience genuine original documents reflecting over 1000 years of history. From Elizabeth I’s signature to the telegrams of the sinking Titanic, students love the wow-factor of being able to see real history on the desk in front of them.
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294c78b07b23869358501f422dcddba74bdef756 | ACCIDENT
Aircraft Type and Registration: Boeing 737-4Q8, OE-IAG No & Type of Engines: 2 CFM56-3C1 turbofan engines Year of Manufacture: 1992 (s/n 25168) Date & Time (UTC): 4 October 2016 at 0455 hrs Location: Runway 25, Belfast International (Aldergrove) Airport Type of Flight: Commercial Air Transport (Cargo) Persons on Board: Crew - 2 Passengers - None Injuries: Crew - None Passengers - N/A Nature of Damage: Fractured lower torsion link on right main gear leg Commander's Licence: Airline Transport Pilot's Licence Commander's Age: 45 years Commander's Flying Experience: 5,900 hours (of which 900 were on type) Last 90 days - n/k hours Last 28 days - n/k hours Information Source: AAIB Field Investigation
Synopsis
On landing, an intense vibration developed, the crew cancelled the automatic brakes and thrust reversers, as there was sufficient runway, and the aircraft came to a stop. The lower torsion link was found to have fractured on the right main landing gear (MLG) possibly due to excessive MLG vibration (shimmy). The cause of the vibration could not be established but may have been related to the speed of the aircraft on landing, and possibly a problem with the shimmy damper or freeplay within the joints associated with the upper and lower torsion links.
History of the flight
The aircraft had taken off from East Midlands Airport carrying 16 tonnes of cargo. It landed at Belfast International Airport at a weight of 54,900 kg (98% of the maximum landing weight) with a forward, but within-limits, centre of gravity. At the time of the landing there was a tailwind component of 5 kt and a crosswind component of 10 kt from the left.
The aircraft touched down about 250 m beyond the threshold of Runway 25. The crew did not recall anything unusual about the touchdown. The speedbrakes were deployed, and subsequently the thrust reversers and the brakes were selected. The crew felt a vibration that started to increase in intensity and they suspected a tyre failure. The anti-skid fail warning illuminated, and the crew cancelled the thrust reversers and automatic braking as sufficient runway remained in which to stop. The aircraft track continued to oscillate close to the runway centreline before stopping 2,170 m beyond the threshold of Runway 25 at its intersection with Runway 17/35. There were no injuries and the aircraft was moved from the runway at approximately 1800 hrs.
**Aerodrome information**
Belfast International Airport, also known as Aldergrove, has two intersecting runways: Runway 07/25, 2,780 m long and Runway 17/35, 1,891 m long (Figure 1).
!\[Figure 1\](Plan of Belfast International Airport (courtesy of Pooleys))
**Meteorological information**
The METARs at Belfast International Airport around the time of the accident were:
EGAA, Belfast / Aldergrove Airport (United Kingdom) Latitude 54-39N. Longitude 006-13W. Altitude 81 m.
201610040420 METAR EGAA 040420Z 13011KT 090V150 CAVOK 12/09 Q1026= 201610040450 METAR EGAA 040450Z 13009KT CAVOK 12/09 Q1027= 201610040520 METAR EGAA 040520Z NIL= 201610040550 METAR EGAA 040550Z 13009KT 090V150 9999 FEW010 12/09 Q1027= A surface wind of 130° at between 9 and 11 kt equates to a tailwind component of around 5 kt and a crosswind component of about 10 kt from the left for Runway 25.
The Met Office commented that:
‘If the 2000FT wind is assumed to have been a conservative 35 KT the vertical wind shear was 12KT/1000FT which meets the requirements for severe turbulence.’
The aircraft manufacturer calculated a tailwind component of 5 kt from 1,000 ft agl to touchdown and a crosswind of 30 kt from the left at 1,000 ft, dropping to about 10 kt from the left at touchdown.
**On-site investigation**
The aircraft stopped on Runway 25 at its intersection with Runway 17/35 (Figure 2).
*Image showing aircraft stopped at intersection of the two runways* A pair of parallel tyre marks to the right of the centre line on Runway 25 had a distinctive ‘S-shaped’ pattern, and started approximately 900 m from the threshold of Runway 25. They continued to the main wheels on the right MLG leg; however for the last 60 m the two marks became straight (Figures 2, 3 and 4).
**Figure 3** Image showing tyre marks close to the aircraft
**Figure 4** Image looking approximately east showing tyre marks
When inspected, both wheels of the right MLG were skewed to one side and there was significant damage to both wheel hubs and both tyres (Figure 5). Both tyres had remained inflated.
The lower torsion link on the right MLG had fractured. Several pieces of debris were recovered from the runway, including pieces of the bushings from the apex where the upper and lower torsion links join. It was not possible to make an accurate assessment of the shimmy damper link condition due to the high level of damage. Recorded information
The aircraft’s flight data recorder (FDR) and cockpit voice recorder (CVR) were downloaded and their recorded data analysed.
Descent into Belfast International Airport
The FDR data showed that as the aircraft descended through 1,000 ft it was configured with flaps 30, and autopilot and auto throttle disengaged. The calibrated airspeed was about 148 kt ($V\_{REF} + 7$), with a tailwind component of approximately 5 kt and crosswind component of approximately 30 kt from the left.
As the aircraft descended below 500 ft, the descent rate was a nominal 800 fpm. This was maintained until about 40 ft agl when the landing flare was initiated, reducing to about 600 fpm (10 fps) at touchdown. The aircraft touched down with 1.7° of left bank and a drift angle of 3° to the right, at about 148 kt CAS ($V\_{REF} + 7$) and a peak recorded normal acceleration of 1.65 g.
Ground track
Figure 6 shows the pertinent data for OE-IAG during the landing rollout and the resulting ground track. The distance on the x-axis (CALCULATED DISTANCE FROM RUNWAY THRESHOLD) is based on an integration of the groundspeed, then working back along Runway 25 from the crossing with Runway 17/35 where the aircraft came to a stop and runway information published in the UK Integrated Aeronautical Information Package. The lateral distance of the aircraft from the runway centreline (CALCULATED LATERAL DEVIATION FROM RUNWAY CENTRELINE) is based on localiser deviation.
An analysis of the data indicates that the aircraft touched down about 250 metres beyond the threshold to Runway 25. The speed brakes deployed on touchdown and the thrust reversers were fully deployed by 530 m beyond the threshold. At about 690 m beyond the threshold, the air/ground discrete erroneously changed to AIR, followed by oscillations in lateral acceleration.
At 950 m beyond the threshold, the brakes were applied. They were released temporarily after about 600 m when the thrust reversers were re-stowed. The aircraft then oscillated from the runway centreline before stopping 2,170 m beyond the threshold.
Figure 6 Pertinent FDR data and ground track on landing Aircraft information
The Boeing 737 MLG leg consists of a cylinder/piston type shock-strut, with the outer cylinder attached to the wing structure, and the lower end of the inner piston carrying an axle with two main wheels. The axle centreline is located 9 cm behind the shock-strut centreline to provide a castoring effect.
A scissor linkage, made up of an upper and lower torsion link, is intended to prevent rotation of the inner piston relative to the outer cylinder, while allowing axial movement to provide shock absorption (Figure 7). The upper torsion link is attached to the outer cylinder via a horizontal pivot joint and the lower torsion link is similarly attached at the inner piston.
Figure 7 Schematic of MLG and shimmy damper A shimmy damper is connected between the apexes of the upper and lower torsion links in order to control the rotary oscillation of the shock-strut inner piston relative to the outer cylinder and thereby prevent excessive MLG vibration (shimmy) during high-speed taxi and under heavy braking. The apex of the upper torsion link is bolted to the damper body and the apex of the lower torsion link is connected to the damper piston rod via a bearing assembly. This consists of spherical bushes sandwiched between two thrust washers and is clamped against a shoulder on the rod by an end nut. The torsion links can pivot relative to each other but horizontal displacement between their apexes is controlled by the damper action (Figure 7).
**Previous shimmy events**
The phenomenon of shimmy, which is an abnormal wheel vibration, is a known issue for the MLG on this aircraft type and typically has a frequency of approximately 15 Hz. To reduce the possibility of shimmy not being damped out due to wear in the apex joint, the applicable issue of the Aircraft Maintenance Manual specifies a number of checks and maintenance operations related to the MLG torsion links and the shimmy damper to replace worn, fractured or cracked apex bushings or apex thrust washers.
The manufacturer provided advice in a quarterly publication in 2013 entitled ‘Preventing Main Landing Gear Shimmy Events’, which is applicable to the Boeing 737-100, -200, -300, -400 and -500 models:
‘…(the manufacturer) recommends pilots strive for a landing with normal sink rates with particular emphasis on ensuring that the auto speedbrakes are armed and deploy promptly on touchdown. An overly soft landing, or a landing which the speedbrakes do not deploy promptly, allows the landing gears to remain in the air mode longer, which makes them more vulnerable to shimmy. This is especially true when landing at airports at higher elevations, where the touchdown speed is increased.’
Later variants of Boeing 737 have a different design and are less susceptible to shimmy.
The manufacturer has also published the following information for the 737 fleet:
- Multi Operator Message MOM-MOM-15-0853, Boeing participation in 737CL Main Landing Gear collapse events under investigation on 15 December 2015
- Service Letter 737-SL-32-057E, Main Landing Gear Lower Torsion Link Fractures on 22 December 2015
- Fleet Team Digest Article 737-FTD-32-11001, Main Landing Gear Shimmy on 15 December 2015.
- Flight Operations Technical Bulletin 737-15-2, Main Landing Gear Shimmy on 14 December 2015. Assessment of the wear in the bushings
The torsion link exhibited some evidence of wear in the bushings. However, the manufacturer, having compared the wear with bushings which had been causal in previous events, did not consider that the wear in the bushings on OE-IAG was significant.
Assessment of fractured torsion link
The two pieces of the fractured lower torsion link (Figure 8) were sent to a metallurgical laboratory for an assessment of the fracture surfaces (note the inboard lug at the top left of the image was cut during removal from the aircraft).
The assessment concluded that the torsion link had failed in overload. There was no evidence of fatigue. It was concluded that the failure of the torsion link was caused by shimmy.
Image of fractured torsion link (courtesy of QinetiQ)
Aircraft maintenance records
Maintenance records indicated that the torsional free play check between the inner and outer cylinder, and therefore an indication of wear at the torsion link apex, had last been successfully carried out on the right MLG in January 2015, with a visual check of the torsion links for security and damage in November 2015; nothing significant was found. Manufacturer’s analysis of FDR data
The manufacturer noted that high-speed landings have been shown to elevate the risk of landing gear shimmy. It noted that the:
‘Flight Crew Reference Manual’ recommends an approach with a tailwind be flown at Vref+5, with the 5 knot additive being bled off during flare. In this case, the airplane touched down at a computed airspeed of 148 kt (Vref+7). In addition the tailwind increased the groundspeed at touchdown to 153 knots’
Analysis
The physical and recorded evidence indicate that the fracture to the lower torsion link on the right MLG leg was most likely caused by shimmy. This and previous occurrences show that the Boeing 737 MLG is susceptible to shimmy, particularly at higher landing speeds and for softer landings.
The manufacturer has a mature and well-documented list of probable causal factors for shimmy on this aircraft type. There was no evidence of a pre-existing defect in the failed torsion link or the apex joint which would have caused the shimmy. It was not possible to assess the condition of the shimmy damper or determine if there was any freeplay in the joints associated with the torsion links. Accordingly it is possible that there was a failure of the damper or excessive freeplay in the joints, which combined with the high-speed landing may have induced shimmy.
Whilst there was no evidence to suggest that maintenance was a causal or contributory factor, the manufacturer is currently working with the operator to assess the maintenance requirements to ensure they are appropriate for its operations.
Footnote
1 737 Classic Flight Crew Training Manual (FCTM) The Boeing Company, Revision date June 30, 2016
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ff2f1a3f90f5c775c838f2ea3d32206c0b51252f | Boosting recycling rates in London
The 2012 Olympic and Paralympic Games present a real opportunity to secure lasting sustainable benefits. London’s boroughs and waste authorities are working hard to meet this challenge - for example, by encouraging more recycling. The capital faces its own set of challenges with regards to recycling and recovery of waste, not least due to the high proportion of households living in flats or estates and the relative lack of gardens and garden waste. This briefing considers a variety of approaches to increasing recycling, re-use and composting rates and highlights how these approaches are being employed in London boroughs.
Overview
The Mayor of London’s 2011 Municipal Waste Management Strategy commits London to meeting the EU Waste Framework Directive target that London should recycle or compost at least 45 per cent of municipal waste by 2015, 50 per cent by 2020 and 60 per cent by 2031. While the rate of recycling, composting and re-use in the capital has increased by 10 per cent over the last four years (2007/07 - 2010/11), Defra statistics indicate that in 2010/11 London’s household waste recycling rate of 32.4 per cent was still nearly 10 per cent lower than the England average of 41.5 per cent.
Recent reports and initiatives
The London Assembly In 2011 the London Assembly published two reports on recycling in London. The first - ‘Carrots and Sticks’ – reviewed incentive and compulsory recycling schemes operated by London boroughs; while the second – ‘Waste not Want Not’ – considered why recycling rates vary across London.
Defra household reward and recognition scheme The government believes that it is better to reward householders for doing the right thing with their waste than to penalise them for doing the wrong thing. It is therefore encouraging councils to reward people who recycle or re-use their waste through Defra’s household reward and recognition scheme. Defra launched the reward and recognition scheme in June 2011. This made a maximum of £500,000 available for 2011/12 to local authorities and community organisations to introduce or trial new schemes that reward or recognise people or communities for adopting such positive behaviours. A second round of funding was launched in April 2012.
The Resource Association - Where does the recycling go? A recent survey conducted on behalf of the Resource Association (a new professional advocacy body for the reprocessing and recycling industries) of 2,078 adults across the UK found that 73 percent of respondents said that they don’t know the exact location of where the materials they put out for recycling go and 65 percent don’t know what these materials will be made into. In the same survey, 68 percent of adults said that more information should be available on what happens to recycled materials in terms of their destination and end use. Thirty-two percent of respondents said that they would be more or much more likely to recycle if this information was available.
The Resource Association believes that the reprocessing industry, the recycling supply chain and local authorities can and should work together to provide more public information on what happens to recycling. The Resource Association, supported by the Local Authority Recycling Advisory Committee (LARAC) Executive has launched the End Destinations of Recycling Charter. This is a voluntary commitment by councils to publish registers of end destinations of recyclates by June 2013.
Recycle for London London boroughs can receive support and resources for communication work around recycling, re-use and composting from Recycle for London (RfL) - a communications programme funded by the London Waste and Recycling Board (LWARB) delivered in partnership by the Greater London Authority (GLA) and WRAP (Waste & Resources Action Programme).
Helping London recycle more London Councils recently published ‘Helping London recycle more’ – a collection of case studies looking at the different approaches taken by London boroughs to increase recycling rates in the capital. This was launched at a London Councils breakfast event which heard from some of the case studies featured and considered the role of local government in stimulating behaviour change amongst local residents in relation to waste minimisation and recycling. Some of these case studies are listed below.
Analysis London boroughs are seeking to increase recycling rate through a number of measures which can be grouped into six categories. These categories are listed below alongside examples of relevant initiatives in London boroughs.
Incentives and awards
**Case study: LB Bexley, Local green points**
Bexley was the first local authority to launch an incentive scheme organised by Local Green Points, which aims to reward residents on a community basis for waste reduction and recycling.
The first phase of the incentives scheme was launched in October 2011, covering 2,000 flats in the East Thamesmead area. Bexley has recently confirmed that it will be rolling out its incentive scheme to a further 17,000 flats across the area.
The scheme incentivises residents to reduce the amount of rubbish they send for disposal by reducing, re-using and recycling their waste. Residents earn green points as a community based on the amount of residual waste they create and the amount they recycle. These points are then allocated equally between each member of the community taking part in the scheme.
Since the scheme was launched in September 2011, around 1,200,000 Green Points have so far been issued to activated households and local charities, making a cash value of around £3,000, of which, more than £800 has been donated to three selected beneficiary charity projects. While this project is at a early stage, residual waste trends in the phase 1 target area indicate that waste is decreasing particularly across areas of low rise flats. Case study: Camden & Westminster - Bin, scan, win!
Street litter accounts for almost a quarter of household waste in Camden and Westminster. Residents, commuters, tourists and other visitors are already given the opportunity to recycle their waste ‘on the go’ in street bins. However, monitoring has shown that street litter recycling rates are only around 10 per cent and littering is still causing significant cleanliness issues for both boroughs.
Camden and Westminster secured £29,500 from the first funding round of Defra’s household reward and recognition fund to apply quick response (QR) codes to 400 recycling litter bins. The QR code, when scanned with a camera phone equipped with a reader application, will direct the user to a dedicated website that allows them to enter a daily prize draw and access to other incentives. The scheme was launched in April 2012 and will run throughout the period of the Olympics and Paralympic Games.
Camden and Westminster are the first councils to use such technology in the recycling sector to target members of the public. The very nature of the technology means that the target audience is limited to the people with necessary hardware and knowledge to scan the codes. However, the demographics in the areas of central London taking part in the trial includes a large proportion of people who are more likely to be ‘tech savvy’ and to understand the use of the codes.
The councils hope to eliminate 25,000 tonnes of litter and save £1 million.
Working with businesses and third parties
Case study: City of London Corporation - Clean city awards
Launched in 1994, the Clean City Awards Scheme (CCAS) provides an example of a local authority working in partnership with businesses by raising the profile of responsible waste management and recognising and rewarding good practice by encouraging businesses to reduce, re-use and recycle. The scheme now has around 1,600 members.
An awards ceremony and lunch is held each year in Mansion House for all members receiving gold and platinum awards. The CCAS team organises quarterly environmental best practice meetings and invites external organisations to present to participants in order to keep them informed on issues like changes to legislation and updates to recycling and waste minimisation options.
Community based approaches
Case study: Waltham Forest - Furnishing the future
Waltham Forest has been working in partnership with Ascham Homes (its housing management company) and two voluntary sector organisations on ‘Furnishing the future’. The project involves changing the way social housing organisations decorate their properties and manage the waste generated by them. Paint and furniture from house clearances are recycled, restored and resold instead of going to landfill. The project consists of five schemes, one of which enables benefit claimants to complete a 16-week course in furniture restoration. Case study: Waste Watch - Our common place
Waste Watch is working with 23 deprived communities living in flatted properties across eight London boroughs on an initiative entitled ‘Our common place’. The idea behind our common place originally developed from a need to improve flats recycling in deprived communities. With expert guidance and advice, communities get together to discuss what is good and what could be improved within their community. Individuals then form groups to work on where they want to see change by developing and delivering initiatives that bring benefit to their community. Critically, Waste Watch is a facilitator while, as far as possible, all initiatives are led by the community and its motivations.
In total 3,200 people living in these communities encountered the project with 930 participating in our common place initiatives. Most importantly 67 residents help co-design and deliver activities and initiatives in their community. This has led to many activities being taken on and run by the local community without support from Waste Watch, for example sew-shall, a weekly sewing group learning how to up-cycle clothes in the Weir Estate, Lambeth.
Education and communication
Case study: Tower Hamlets - Recycling makes sense in every language
While the recycling rate in Tower Hamlets had increased significantly in the three years up to 2011, further increases were likely to prove a significant challenge, in part because of a combination of factors that make communicating recycling particularly difficult.
Responding to this challenge, a team, including borough officers, Veolia Environmental Services (the council’s waste management contractor) and designers Billington Cartmell, worked together to plan a high-impact communications campaign.
A creative campaign was developed based on translations of community languages with illustrations encouraging residents to ‘recycle more’, using the strap line ‘Recycling makes sense in every language’. Designs incorporated Mr. Recycle More, a large robot made out of purple recycling bins, who is a local figurehead for recycling. The campaign included outdoor advertising on routes carefully selected to maximise cost effectiveness and to target residents rather than commuters. Initial monitoring indicates extremely positive results: from January to April 2011 an additional 250 tonnes of material was recycled compared to the same period in 2010.
Tower Hamlets is planning an anti-contamination campaign in September/October 2012. This will be supported through the Recycle for London communications programme.
Service changes
Case study: Brent, Haringey and Harrow
Brent, Haringey and Harrow have implemented service changes as a means of increasing recycling rates amongst their residents. Both Brent and Haringey have introduced alternate weekly collections of residual waste, supplemented by weekly collections of organic waste. Haringey is seeking to deliver a 40 per cent recycling rate and a 40 per cent reduction in emissions by 2015, while Brent’s target is to recycle 50 per cent of household waste in the borough by 2014 and to divert 60 per cent of waste from land fill.
As a result of a series of service changes introduced by LB Harrow, the borough’s recycling rate nearly doubled over a five-year period. The recycling rate rose from 27.7 per cent in 2006/07 to 50 per cent in 2010/11 – the second best level of performance in London. Other initiatives
London boroughs and waste authorities are operating a variety of other schemes including: mattress recycling; the promotion of re-useable shopping bags; recycling roadshows; give and take days and food waste collections from estates.
Commentary
If London’s waste authorities are to recycle, compost or re-use 50 per cent of household waste by 2020, there is clearly a need to go much further. Although London Councils has argued that London needs to do more to reduce waste in the first place, recycling, re-use and composting still have an important role to play in helping residents and businesses to take responsibility for their waste and its environmental impacts. It also saves the taxpayer money.
The case studies published recently by London Councils highlight London’s commitment to both reducing the amount of household waste that is sent to landfill or incinerated and to stimulating behaviour change amongst residents. All the approaches considered have produced positive results. However, it remains to be seen whether the use of incentives and rewards brings short-term change and low levels of loyalty to the new behaviour, and equally whether education and communication, while providing less dramatic results in the short term, can provide more sustainable behaviour change in the longer term. Some boroughs have found the introduction of compulsory recycling to be very effective in increasing recycling rates, while others prefer to incentivise individuals or communities to recycle.
It has been suggested that one way to help boost recycling rates amongst London’s transient and tourist population is to have one coherent recycling scheme across London so that recycling practices would be consistent across the capital. However, as London’s recycling rates increase – this could lead to more uniformity between boroughs and waste authorities on what is recycled.
Behaviour change and culture change
Behaviour change and culture change are often conflated when discussing waste and recycling, however it is arguable that culture change is different from behaviour change and is about viewing waste as a resource to be used carefully.
Recent research in the area of waste and behaviour change suggests that local authorities should not necessarily take the lead on communications activity around waste and behaviour change. Communications may be best left to marketing organisations and retailers who have the experience and resources to lead on this work. Campaigns such as Ariel’s ‘wash at 30 degrees’ campaign, launched in 2006 – while not waste related – show the potential for behaviour change that can be achieved through highly visible campaigns associated with well known brands. However, many London boroughs have a high population churn and so feel that they have to put resources into communications around recycling, however this could be done in partnership with the retail sector.
Earlier this year, Joanna Lumley launched the Marks and Spencer ‘Shwopping’ campaign - an initiative which involves customers bringing an old item of clothing into an M&S store each time they come to buy something new. All the donated clothing goes to Oxfam. While campaigns such as this are very effective in terms of raising the profile of an issue (in this case textile recycling), local authorities would welcome reference to local recycling options provided by local authorities and closer collaboration, along the lines of the ‘Love Food Hate Waste’ campaign on food waste reduction run by WRAP (the Waste and Resources Action Programme) in partnership with the retail sector. The retail sector already communicates to the public on local authority recycling services through the ‘on pack recycling label’, launched by the British Retail Consortium with support from WRAP. This scheme aims to deliver a simpler, UK-wide, consistent, recycling message on both retailer private label and brand-owner packaging to help consumers recycle more material, more often. However, this on its own may not be sufficient to create behaviour change around recycling.
**Author:** Alice Ellison, policy and projects manager (T: 020 7934 9809)
[Click here to send a comment or query to the author](#)
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