Inside Parliament: Familiar remarks conjure up regular demons: - New Home Secretary says he wants to frighten the criminals - - Patten declares an end to the student union 'closed shop'

The Commons agenda yesterday was strongly reminiscent of a Conservative conference with a statement on student unions, one of the party's favourite demons, and a debate on law and order.

Michael Howard, the new Home Secretary, said he wanted to help create an atmosphere 'in which it is criminals that are frightened - and not members of the public'. But Tony Blair, his Labour shadow, said successive home secretaries had made the same pledge. The 1979 Conservative manifesto had promised, 'We will restore the rule of law', but crime had risen dramatically.

'The problem, all the way through, with the way Mr Howard's party has handled this issue is that they refuse to accept that we cannot cut crime in this country unless we escape from the idea that you choose between punishment and prevention, between dealing with criminals and tackling the underlying causes of crime.'

Mr Howard anticipated such liberal thinking as he opened the debate. 'We have to recognise where crime begins,' he said. 'I don't mean that we should listen to the woolly- headed theories that society is at fault and criminals are not to blame. Of course not - we can leave that nonsense to others.

'We must do more to teach children the difference between right and wrong. We must teach the importance of accepting responsibility for our own actions, and considering the consequences for others.'

But Mr Howard said there was no point in politicians calling for a return to 'old fashioned morality and respect for authority' if they did not know how it was going to be achieved. 'It must start at home. And it must also be taught in our schools and by all who work with and care for children and young people. Above all, it must be taught by example.'

Mr Howard's platitudes were some way from the activities, criminal or otherwise, which still consumed most attention at Westminster. David Mellor, who made a personal statement after quitting the Cabinet nine months ago, used the debate to air worries about the Serious Fraud Office.

As a Home Office minister, Mr Mellor had charge of the Bill setting up the SFO. 'It was right to do that. Nothing could be worse for setting the values for society than the poor man is run in for a bit of pick-pocketing whereas the rich man in the City gets away with making millions through sophisticated fraud.'

To deal with serious fraud, the SFO needed accountants and lawyers continually involved, he said. The Commons had also ended the right of silence in the case of SFO inquiries. 'When Parliament has entrusted them with that special kind of power, then it is even more incumbent on them than any other officer involved in law enforcement to be manifestly conducting their inquiries with integrity.'

Mr Mellor said he did not know the rights and wrongs of Michael Mates's allegations against the SFO's handling of the Asil Nadir investigation, but it was clear that if confidence was to be maintained in the SFO, and there were ready answers to the charges by Mr Mates and others, then they should be quickly put before MPs.

A great public inquiry would undermine a body that was needed now more than ever before, he said, but he advocated 'a review with a small r' of the way in which the SFO used its powers. Causes for concern went beyond those of Mr Mates, he contended. 'Why, when Kevin Maxwell, for whom I hold no brief, is arrested at 6 o'clock in the morning are there lots of press men around? You are not telling me that it's a coincidence. They were tipped off.'

Mr Mellor also suggested the Commons sub judice rule, intended to prevent MPs prejudicing legal proceedings, should be given some thought in the wake of Mr Mates's confrontation with the Speaker, Betty Boothroyd. 'If indeed the sub judice rule in this House does preclude Mr Nadir's case being discussed, and if you assume, as I do, that Mr Nadir is not going to come back into this jurisdiction, then you are left with the interesting conclusion it will never be possible in this House to raise the case of Mr Nadir.'

But the list of alleged donors to the Conservative Party is long enough for this not to cause too much difficulty for John Smith. At Question Time he challenged the Prime Minister over a reported pounds 1m donation by Octav Botnar, the former head of Nissan UK, now holed- up in Switzerland.

The Labour leader asked John Major if he would be inviting the Conservative Party to repay the pounds 1m to the Inland Revenue following the revelation that it was given by Mr Botnar during the same period that 'the taxpayer was defrauded by pounds 97m in Britain's biggest ever tax fraud involving Nissan UK'.

Mr Major attacked Labour's links with the trade unions, then reiterated his pledge that: 'Where tainted money has been provided to the Conservative Party, we will replace it.'

Mr Smith snapped back: 'Can the Prime Minister tell us if the Conservative Party received money from Mr Botnar?' Momentarily Mr Major seemed thrown by the brevity and directness of the question. To mounting Labour jeers, he replied: 'I have no idea whether the Conservative Party received money from Mr Botnar at around 10 years ago. I am not responsible for that.'

On the issue of responsibility, Mr Major began Question Time with a blistering challenge to Mr Smith to disown the leaked internal party discussion document proposing bilateral talks with the Irish Republic about joint action over Ulster, if the Northern Ireland parties failed to reach agreement within six months.

The Prime Minister said it appeared Labour proposed to abandon its commitment to a united Ireland only by consent. 'They want to permit a united Ireland through economic deprivation. If they are the Labour Party's policies, they are cynical and shameful; they are a betrayal of democracy and the people of Northern Ireland.'

Tory MPs loved it, as they did John Patten's announcement to end the student union 'closed shop'. Don Foster, the Liberal Democrats' education spokesman, observed: 'This statement is nothing more than a well-gnawed bone that has been thrown to appease the Secretary of State's backbenchers, who are disillusioned by his other educational reforms.'

Mr Patten said he intended to limit the purposes for which universities and colleges could pass on taxpayers' money to campus unions to core services such as welfare, catering and sport. The taxpayer should not be expected to support activities which were unaccountable or political. Students would be able to 'opt in' to whatever collective involvement they chose.

Jeff Rooker, a Labour education spokesman, said a government survey had found that less than 2 per cent of total student union incomes was spent on political activities. He accused Mr Patten of 'wasting Parliament's time, when student unions are spending more time trying to keep students alive and well-fed because of the stress they're under.'

What about the stress at Westminster? With all the sensitivity to mood of an ex-leader of the Commons, John Biffen suggested that the Government pack MPs off on their summer holiday.

During questions to Tony Newton, the present Leader of the House, Mr Biffen asked if he could 'recall any occasion when the reputation of of Parliament has been enhanced during the month of July?

'Does he not think in terms of sound political management there is an overwhelming case for a very early recess?'