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Lord Fraser of Carmyllie: My Lords, it is curious that the noble Lord should seek to pray me into an alliance with him on matters relating to a Scottish assembly. If there had ever been a proposal which I thought was at least worth considering, it was the one put forward by the noble Lord, Lord Home, years ago, which was a very different proposal to the one which the noble Lord now puts forward. I am grateful to the noble Lord for his honesty because in an earlier debate in your Lordships' House it will be recollected that he pointed out that, if the West Lothian question is to be answered, it will mean that regional assemblies in England will have to be given exactly the same powers as are to be given to a Scottish assembly—in other words, the gutting of England and the end of the Westminster Parliament.

Baroness Carnegy of Lour: My Lords, to return to the more immediate Question on the Order Paper, does not my noble and learned friend agree that travelling through the Highland areas of Scotland and the Border country it is very easy to understand why each Member of Parliament represents a smaller number of constituents than the average in England because the population is sparse? It is across the central belt of

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Scotland where the comparison can be made much more closely with the highly populated areas of England. That is where the trouble is.

Lord Fraser of Carmyllie: My Lords, my noble friend is correct. Circumstances are very different in the remote rural parts of Scotland and, given its geography, one understands why the Western Isles constituency has an electorate of only some 22,000. Perhaps I may reassure my noble friend that some years ago the central Glasgow constituencies had very small electorates. However, I am glad to say that that position has been corrected and the three smallest Scottish constituencies are now remote rural constituencies. A further boundary review is under way, and I believe that in the west central belt the figures will more or less come up to the Scottish average.

Baroness Seear: My Lords, given the strength of the Lander in Germany and the undoubted power of the Federal German Government, why does the Minister think that regional devolution in Great Britain would lead to the demise of the Westminster Parliament?

Lord Mottistone: Because we are not Germans!

Lord Fraser of Carmyllie: My Lords, that question seems to have been answered for me. My concern is that, while I regard Scotland within the Union as a nation, I also regard England within the Union as a nation and I do not believe that it does anyone in England any good to have what has been the unity of England for some 800 years broken up.

Lord Carmichael of Kelvingrove: My Lords, the Minister mentioned the noble Lord, Lord Home of the Hirsel. We should get this straight. When the referendum was held in, I think, 1979 he made a clear statement that he would introduce a proper devolution Bill and that we should not therefore vote on the Bill that was then put forward by the Government. That caused distortion and a great deal of feeling against devolution among Conservatives. Fortunately, there are now even fewer Conservatives in Scotland than there were then. He also suggested that there was some support for devolution at one time. May I quote—

Noble Lords: No. Question!

Lord Carmichael of Kelvingrove: My Lords, a very distinguished Member of the other House, who is reckoned to be possibly the next Foreign Secretary, made it clear that he was totally in favour of devolution for Scotland. I am referring to the present Secretary of State for Defence, Malcolm Rifkind, as well as which—

Noble Lords: Order!

Lord Carmichael of Kelvingrove: My Lords, if Scotland had had proper representation on geographic terms, I understand that there would be something like 90 Members for Scotland. Whatever the Government expect to do now, I believe that Conservative

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representation in Scotland is now running at about the same percentage as that for Gerry Adams in Northern Ireland.

Lord Fraser of Carmyllie: My Lords, the important thing that the noble Lord, Lord Home, revealed at the time of the referendum was that the proposals that were being put before the Scottish people were fundamentally flawed. In the 15 years that have elapsed since then, no significant effort has been made to eliminate those flaws. To return to the Question, I want Scottish constituencies to remain as they are. In particular, I hope that the West Lothian constituency will continue to vex us for a considerable time!

Public Utilities: Managerial Salaries

3.3 p.m.

Lord Dean of Beswick asked Her Majesty's Government:

    Whether the present financial rewards being received by chairmen, directors and senior management in the privatised public utilities are in accordance with the Government's original privatisation objectives.

The Minister of State, Department of Social Security (Lord Mackay of Ardbrecknish): My Lords, privatisation has proceeded fully in accordance with the original objectives. In line with those objectives, management issues, including remuneration, are matters for the companies themselves and their shareholders.

Lord Dean of Beswick: My Lords, unfortunately the Minister is disagreeing with what the Prime Minister said yesterday at Question Time when he said that he did not support such astronomical salary increases. Is it not the case that the people who are now running the privatised, former public sector industries are disgorging labour rapidly in order to buttress their own salaries? Is it not disgraceful that most of the people who are being sacked were doing reasonable jobs within the community? Is not that an outstanding example of avarice on the part of those who are acting simply for personal gain?

Lord Mackay of Ardbrecknish: My Lords, I do not think that I will take a lesson on avarice and envy from the Labour Party. My right honourable friend the Prime Minister has made two things abundantly clear. The first is that he does not agree with excessive and unjustified wage increases; and the second is the point that I made in my Answer, which is that the companies concerned are in the private sector and remuneration is a matter for them and their shareholders.

Lord Marlesford: My Lords, does my noble friend agree that under the capitalist system there is no problem over paying people highly, but those who receive that high pay may well have a problem earning it?

Lord Mackay of Ardbrecknish: My Lords, my noble friend is absolutely right. Indeed, that point encompasses a much wider field than merely the

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chairmen and chief executives of companies that were previously in the public sector. It encompasses all other companies, as well as people like footballers who seem extraordinarily well paid, and television and media personalities among others. Indeed, if I dare say so in your Lordships' House, it might even include some lawyers who earn what most of us would consider to be fairly astronomical fees. My question is whether the Labour Party is going to set up a body to regulate all those incomes.

Lord Strabolgi: My Lords, the Minister said that this is a matter for the shareholders. The Government say that frequently, but is the Minister aware that the power of the shareholders is much exaggerated? The big institutional shareholders do not want to get involved, and many of the smaller shareholders are retired people who do not have the resources to organise any opposition to such enormous and disgraceful pay rises.

Lord Mackay of Ardbrecknish: My Lords, the Government appreciate the important role which institutional shareholders have to play in this and other regards. On a number of occasions when this issue has arisen my right honourable friend the Prime Minister has made it quite clear that we wish to encourage institutional shareholders to play an active part in such companies, most of which they own.

Lord Campbell of Croy: My Lords—

Lord Peston: My Lords, the noble Lord has already spoken this afternoon.

Lord Hailsham of Saint Marylebone: Campbell!

The Lord Privy Seal (Viscount Cranborne): My Lords, we have one minute left for Questions. I know that the Opposition Front Bench spokesman has wanted to get in, but if the noble Lord is quick, I imagine that there may be time for another question.

Lord Peston: My Lords, I am always extremely brief. The Minister referred to "avarice and envy". I am not sure that I am avaricious, but I am certainly envious of such salaries and I would not beat about the bush on that point. I only wish that I had the chance of them! Is the Minister really saying what he appears to be saying, which is that the privatisations have occurred exactly as the Government predicted and that these salaries are therefore what the Government predicted? If the Minister is saying that, how can his right honourable friend the Prime Minister possibly complain about them? If it has gone according to plan, what is the argument about on the Government's side?

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