Commons Sitting of 14 December 1995

Preamble
The House met at half-past Two o'clock
PRAYERS
[MADAM SPEAKER in the Chair]
PRIVATE BUSINESS

  CITY OF WESTMINSTER BILL [Lords]
  Motion made, and Question proposed,
  That the Promoters of the City of Westminster Bill [Lords] may, notwithstanding anything in the Standing Orders or practice of this House, proceed with the Bill in the present Session; and the Petition for the Bill shall be deemed to have been deposited and all Standing Orders applicable thereto shall be deemed to have been complied with;
  That if the Bill is brought from the Lords in the present Session, the Agents for the Bill shall deposit in the Private Bill Office a declaration signed by them stating that the Bill is the same, in every respect, as the Bill which was brought from the Lords in the last Session;
  That, as soon as a certificate by one of the Clerks in the Private Bill Office, that such a declaration has been so deposited, has been laid upon the Table of the House, the Bill shall be read the first and second time and committed (and shall be recorded in the Journal of this House as having been so read and committed) and shall be committed to the Chairman of Ways and Means, who shall make such Amendments thereto as were made by him in the last Session, and shall report the Bill as amended to the House forthwith, and the Bill, so amended, shall be ordered to lie upon the Table;
  That no further Fees shall be charged in respect of any proceedings on the Bill in respect of which Fees have already been incurred during any previous Session.—[The Second Deputy Chairman of Ways and Means.]
  Hon. Members: Object.
  To be considered on Thursday 11 January.

Oral Answers to Questions
  AGRICULTURE, FISHERIES AND FOOD

    Hill Farming
    Mr. Win Griffiths: To ask the Minister of Agriculture, Fisheries and Food what proposals he has to encourage young people to enter hill farming. [4127]
    The Minister of Agriculture, Fisheries and Food (Mr. Douglas Hogg): I have no plans to introduce measures specifically to encourage young people into hill farming. However, the Agricultural Tenancies Act 1995, which came into force on 1 September this year, will encourage landowners to let more land. This has been reinforced by 100 per cent. relief from inheritance tax for land in new tenancies granted on or after 1 September. As the market in let land is freed up, more opportunities will be created for new entrants generally.
    Mr. Griffiths: I must tell the Minister that few young farmers will be cheered by his reply. The background to
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    the Government's dealings with farmers in our hill country areas is that the livestock compensatory allowance has been cut or frozen over the last four years, grants in the less-favoured areas have been cut from 50 per cent. to 30 per cent., and farmers have less income than ever before. Instead of possibly making more land available, is not it time for the Government to do something to improve farmers' incomes, which have decreased in my own constituency and in other parts—
    Madam Speaker: Order. We have questions to get through today. We do not want statements.
    Mr. Hogg: As to the first point about let land, what really troubles young farmers is the knowledge that the hon. Gentleman and the hon. Member for Edinburgh, East (Dr. Strang) introduced legislation in 1976 which did enormous damage to the ability of landowners to let land. They will have been shocked by the Labour party's decision to vote against the Agricultural Tenancies Act 1995, which has done an enormous amount to free up land.
    Mr. Thomason: Does my right hon. and learned Friend agree that the best way for young people to enter farming, whether it is hill farming or otherwise, is for them to have the opportunity to have their own tenancies? Does not the Minister find it extraordinary that the Labour party should therefore seek to oppose that very move?
    Mr. Hogg: My hon. Friend is entirely right. The 1995 legislation was agreed between all parts of the industry, and the Government would not have introduced it unless it had been so agreed. The Labour party defied informed opinion by voting against the legislation, and that was a disgrace.
    Mr. William Ross: Given that the land tenure situation in Northern Ireland is very different from that in Great Britain, does the Minister understand that the real concern of farmers in the hill areas of Northern Ireland has to do with the percentage of their net income that is at present derived from subsidies? What comfort can he give to those people over the long term?
    Mr. Hogg: I shall not refer directly to the question of farmers in Northern Ireland because I do not have the necessary expertise; that is more a matter for my right hon. and learned Friend the Secretary of State for Northern Ireland. I can say that, in 1995-96, the real value of farm incomes in the LFAs is expected to rise by 4 per cent. On the value of direct subsidies coming into LFAs in the United Kingdom, there has been a steady increase from 1993—and, it is anticipated, until 1996—in the real value of direct subsidies to livestock farmers. Incidentally, hill livestock compensatory allowances form only a relatively small part of the overall direct subsidies to livestock farmers.

    Regional Speciality Foods
    Mrs. Lait: To ask the Minister of Agriculture, Fisheries and Food what steps he is taking to promote British regional speciality foods. [4129]
    The Minister for Food (Mrs. Angela Browning): As the Minister in the Department responsible for small businesses, I am especially concerned to assist this dynamic and growing sector of the food industry.

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    We continue to support Food from Britain, which is broadening its active support for marketing groups and for individual businesses.
    Mrs. Lait: I thank my hon. Friend for that helpful answer. Is she aware that France's wonderful regional products are supported by forms of producer co-operatives? In my constituency, we have wonderful lamb from the Romney marshes, superb fish from the sea, and great cheeses and fruit. Can my hon. Friend assure me that we will have more publicity and help for regional speciality food groups?
    Mrs. Browning: Indeed, the regional food groups have been very successful in bringing together many smaller groups and individual businesses. We already have the well-established Taste of the West, Taste of Anglia and North West Fine Foods. My hon. Friend will be especially interested to know that, in January, two more groups will be launched—Middle England Fine Foods and Taste of the South East.
    Mr. Martyn Jones: Is not it true, however, that British food is not being supported enough? We have a huge deficit of £6 billion in temperate foods that we could grow in this country. If we put some money into Food from Britain, instead of cutting back, and supported our farmers as the French do, we would have a real advantage in selling our food abroad.
    Mrs. Browning: I meet Food from Britain regularly and I frequently go abroad to support that organisation and British companies that are exporting quality, speciality British foods with great success. It is interesting that that particular sector of the food industry—speciality foods and small food companies—employs 20 per cent. of the work force employed in the food industry.
    Sir Jim Spicer: My hon. Friend has rightly mentioned Taste of the West. Does she agree that the success and the value added to all those products rests upon people such as George and Amanda Streatfeild—whom she knows—of Denhay Farms, who play such a remarkably virile role in Taste of the West?
    Mrs. Browning: Indeed. [HON. MEMBERS: "Who are they?"' I shall tell hon. Members who they are. They are farmers, a husband and wife team in Dorset, whom I have met. They have exhibited at many national and international exhibitions. Among their many excellent products, they produce air-dried ham, which the Italians think they are best at, but the Streatfeilds have beaten them to it in many awards.

    Milk
    Mr. Jim Cunningham: To ask the Minister of Agriculture, Fisheries and Food if he will make it his policy to maintain the present levels of milk production. [4130]
    The Minister of State, Ministry of Agriculture, Fisheries and Food (Mr. Tony Baldry): Yes. The Government's policy is to resist any cuts in the UK's milk quota allocation.
    Mr. Cunningham: Is the Minister aware that a number of milkmen, especially in the west midlands, are being put out of business, and that there will be a shortage of
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    milkmen very soon, because the supermarkets are taking over the business? What does the Minister propose to do about that?
    Mr. Baldry: That is just competition in the marketplace, and nothing to do with EC milk quotas. At 26p for a four-pint poly-bottle of milk in our supermarkets, milk in the UK is cheaper than anywhere else in the European Community.
    Mr. Peter Atkinson: Can my hon. Friend set out the Government's view on the future of milk quotas?
    Mr. Baldry: Our ultimate objective is to get rid of milk quotas, because we are prevented from making the most of the UK's natural advantages for milk production by the EC quota system. So we wish to get rid of milk quotas.
    Mrs. Golding: Is the Minister aware that a recent survey by the Co-operative Wholesale Society showed that 11 to 16-year-old children are consuming far too little milk and other dairy produce? Instead of working to deprive our children of milk, does not the Minister think that it would help the milk industry and the health of our nation if he stopped treating the dietary needs of our schoolchildren with such contempt?
    Mr. Baldry: That really is over-hyping it. The take-up of the scheme varied greatly between local education authorities so the benefits were already spread unequally. Those benefits have never been targeted on the basis of need. We do not believe that the changes will have any effect on the health or nutrition of British teenagers.
    Mr. Pike: To ask the Minister of Agriculture, Fisheries and Food what funding the United Kingdom will receive from the EU in 1995-96 towards the cost of milk in secondary schools and school catering. [4131]
    Mr. Douglas Hogg: We estimate that EU expenditure on the discretionary elements of the school milk scheme will amount to approximately £6.1 million in the United Kingdom in 1995-96. Doing away with the discretionary element will result in public expenditure savings of about £4 million.
    Mr. Pike: Does the Minister accept that this subsidy, unlike much of the £3 billion subsidy to the dairy industry from the common agricultural policy, is an important and essential one? Will he take more notice of what nutritional experts say and make sure that this cut does not take place?
    Mr. Hogg: The scheme is neither important nor essential. We continue to subsidise milk for primary schools at a cost of about £12 million a year. As the Minister of State has just made plain, the take-up is extremely uneven: not all local authorities take up the scheme, and even in participating LEAs not all schools do so. There is no targeting of need, and the scheme is an inefficient use of resources.
    Mr. Marland: Does my right hon. and learned Friend agree that it is worth reiterating that any change in policy will have no effect on primary schools, that milk will still be available to them, and that it is not the Government's objective to force-feed teenagers with milk?
    Mr. Hogg rose—
    Mr. Marland: It is surely up to parents to decide whether they want their children to drink milk, and they have some responsibility in that respect.

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    Does my right hon. and learned Friend further agree that any reduction in milk consumption at schools will make more milk available for manufacturing, for adding value and for creating wealth?
    Mr. Hogg: I apologise to my hon. Friend for getting to my feet too soon. I should like to focus on two of his important points. He is right to draw attention to the fact that we subsidise the consumption of milk in primary schools. His second point is basic: it really is up to parents to encourage their children to drink milk, if that is what they deem right for them. Theirs is the responsibility; we must go on emphasising that kind of basic fact.
    Dr. Strang: But surely the right hon. and learned Gentleman is aware that only two years ago a Minister of State in the Department was telling the House what a great scheme this was, and that we should encourage teenagers to drink milk in our schools—particularly young girls, to help reduce the risk of osteoporosis in later life. The Minister knows that the policy is wrong, and that we should be encouraging teenagers to drink more milk. Will he reconsider?
    Mr. Hogg: That is nonsense, and the hon. Gentleman knows it. What is more, it shows why the Labour party cannot be taken seriously when it talks about reducing expenditure and tax. The plain fact is that this is saving us £4 million which I can then spend on areas of greater priority in the agriculture budget. People should focus on schemes to determine whether they are good or bad. This one is not a good use of resources; that is why we have done away with it.

    Fishing Industry
    Mr. Harris: To ask the Minister of Agriculture, Fisheries and Food what steps he is taking to involve United Kingdom fishermen in discussions on future developments in the industry. [4132]
    Mr. Baldry: I regard dialogue and consultation with UK fishermen as imperative. I already hold regular consultations, meetings and pre-Council of Ministers briefing meetings with many of their representatives.
    Mr. Harris: I appreciate and applaud all that my hon. Friend has done in this respect. Still, can he convince me and the House that Her Majesty's Government appreciate the depth of anger of our fishermen, especially in the south-west, about the fact that as from 1 January 40 Spanish vessels will be allowed into western waters? Moreover, our fishermen almost certainly face significant cuts in their quotas; and to rub salt in the wound, taxpayers will have to pay large sums in compensation to Spanish interests for the removal of those wretched flag-of-convenience vessels from our register. Can my hon. Friend tell me and my fishermen what future the fishing industry has?
    Mr. Baldry: First, it is important that the House recognises that the Factortame judgment has absolutely nothing to do with the fisheries policy. It is a judgment, in the Advocate General's opinion, on the freedom of business association for individuals in the European Union. It has nothing to do with fisheries policy. Indeed, if we were to leave the common fisheries policy, the Factortame judgment would still stand. I of course appreciate the UK fishing industry's concerns that it must
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    have a long-term sustainable future, and every part of every policy that I take forward is bent on that end. Certainly at the Fisheries Council meeting next week I am determined to negotiate the best possible fishing opportunities for British fishermen, consistent with the scientific advice and the need to sustain stocks for the benefit of future generations of fishermen.
    Mr. Skinner: Is the Minister aware that the Government are always bragging about their opt-outs in the Common Market? Why do they not opt out of the common fisheries policy?
    Mr. Baldry: This House decided by a considerable majority in the early 1970s to join the European Community. In joining it, we signed up to the common fisheries policy. When the Labour party sought to re-negotiate our terms of entry, not a word was mentioned about fishing policy.
    Mr. Jenkin: I thank my hon. Friend for taking time to meet representatives of Kent and Essex fishermen earlier in the year. Can he give us any further news on the non-sector quota? It is restricting the supply of fish to such traditional fisheries, to the point that—I am afraid—today they are sawing up their boats on the beach.
    Mr. Baldry: I am trying to see whether there are ways in which we can allocate more quota to the non-sector fishing industry. I appreciate my hon. Friend's points. The industry has very real concerns and I am trying to see whether there are ways in which we can meet them.

    Veal Crates
    Mr. Colin Shepherd: To ask the Minister of Agriculture, Fisheries and Food what action he has taken to work for an EU ban on the use of veal crates. [4133]
    Mrs. Browning: The Government have already achieved a review of directive 91/629 on the welfare of calves, bringing it forward from 1997. As a result, the Commission has obtained the advice of its Scientific Veterinary Committee and is on the point of putting proposals forward to the Council of Ministers. We shall press the Council for an end to the veal crate throughout the European Community and for changes to the unacceptable EU dietary requirements.
    Mr. Shepherd: I thank my hon. Friend for that comprehensive answer. Is not the way forward for it not to be necessary for calves to be trans-shipped to Holland or wherever, and that the issue should be tackled by having a robust United Kingdom calf-rearing industry, which will meet the market's requirements? Is work not being done in that respect at the Rosemaund experimental husbandry unit near Hereford? Will my hon. Friend tell the House what progress is being made?
    Mrs. Browning: The launch of the Rosemaund experimental unit has attracted much interest. We have worked with the Meat and Livestock Commission to target interest in the catering industry especially, where much of the Dutch-reared veal is used; veal reared in those unacceptable crates. I assure my hon. Friend that the unit has proved very successful in introducing to people who are interested in raising welfare-friendly veal in the UK ways in which to go about it in the most welfare-friendly manner.
    Mr. Shore: Have the Ministry and the Commission in Brussels never heard of the word subsidiarity? If they have heard of the doctrine of subsidiarity, why do not they apply it to the veal trade? Why does the Ministry not come forward with legislative proposals in this House to ban the export of veal under the present conditions and then wait to be challenged, if need be, in the European Court?
    Mrs. Browning: We took the decision in the House in 1990 unilaterally to ban the veal crate. I must say to the right hon. Gentleman that if we are seriously interested in the welfare of animals generally in the European Union, it should be as much a matter of concern to know that just over the channel those deplorable practices continue. We in this country have led the way with the banning of veal crates, and we hope that as a result of our actions—this year I have visited other Agriculture Ministers personally about the issue—other countries will understand that we did it not from an emotional viewpoint but from one of very clear science that shows that it is not in the animals' best interest. We want to see that policy applied throughout Europe—not in little England with the drawbridge drawn up.
    Mr. Gale: May I congratulate my hon. Friend on the personal efforts that she has made to try to bring an end to a vile practice? We had hoped to see a ban imposed on the use of veal crates throughout the European Union by the end of the year. When does my hon. Friend think that a ban may be possible? I ask her and her departmental colleagues to seek to ensure that farm animal welfare has a proper place at the intergovernmental conference next year.
    Mrs. Browning: I can assure my hon. Friend that at the meeting of the Council of Ministers next week my right hon. and learned Friend the Minister will be seeking to hear the results of the Scientific Veterinary Committee. We are hopeful that our policy will be taken forward in Europe. The presidency has expressed its interest and concern that progress should be made, as have, interestingly, the Italians, who will take over the presidency in January. There is continuity in Europe to take forward the policy.
    It has been the Government's policy to seek European-wide policies on animal welfare. But that is not the Labour party's approach. I shall share with the House a letter from a shadow Opposition spokesman. It was written only last month to Franz Weber. It reads:
    "Thank you for your letter about the transportation of live animals across Europe. I strongly support your call for an end to the current legal provisions which allow the export and transport of live animals for slaughter."
    Opposition Members should understand that the greater prize is to be concerned about the welfare of animals throughout the Community.

    Right to Roam
    Mr. Bellingham: To ask the Minister of Agriculture, Fisheries and Food what plans he has to introduce a right to roam; and if he will make a statement. [4135]
    The Minister for Rural Affairs (Mr. Tim Boswell): As emphasised in the recent White Paper on rural England, we believe that a general right to roam is not acceptable.
    Mr. Bellingham: Is my hon. Friend aware that there is already an excellent network of footpaths? Farmers have made much more effort to maintain those footpaths properly and consequently they have an excellent relationship with ramblers. Does my hon. Friend agree that a general right to roam would put at risk the present good relationship, break down trust and lead to quite of lot of environmental damage? Will he educate the Opposition? If they want to win votes in the countryside, they should drop the policy of a general right to roam.
    Mr. Boswell: My hon. Friend puts the matter in a nutshell. There is already a wide and satisfactory network of footpaths. We would not condone any failures to keep footpaths open. We believe that any imposed general right to roam beyond the present network of footpaths would elevate one interest above all others, institutionalise rights without obligations, upset rural communities and cause a great deal of damage.
    Mr. Morley: Is the Minister aware that the hon. Member for North-West Norfolk (Mr. Bellingham) advocated introducing wolves into Scotland? It now appears that he wants to train them to attack people in cagoules walking across land. Surely there is a need to be reasonable. There are large areas of land that traditionally have been open. That was the position in the past. There has been access to them for generations. It is possible to have a right to roam that will not compromise crops or livestock. It would be balanced with the needs of the people generally and those of farmers. Let us have fewer smears in Government documents and more realism in understanding that a balance could be achieved.
    Mr. Boswell: The hon. Gentleman is right to the extent that freedom to roam in open country may be appropriate in certain circumstances. The vital ingredient that he omits is that of agreement. I know that it may come difficult given the Labour party's philosophy, but we think that agreement is the most important element. These issues are most appropriately decided by agreement between landowners and local people, as they conspicuously have been in many good examples.
    Mr. Garnier: Does my hon. Friend have any plans in the near future to meet representatives of the Ramblers Association? If he does, will he tell them that it is not necessarily sensible for them to appeal against every order made by a county council extinguishing or amending the route of a public footpath? Does my hon. Friend understand that many farmers are prepared to deal with the Ramblers Association and to maintain rights of way as long as they do not interfere with their farming practices?
    Mr. Boswell: I strongly agree with my hon. and learned Friend that megaphone diplomacy is most inappropriate in these instances. Last summer, we invited the ramblers to discuss with officials any specific cases under our access schemes where they considered that provision was unsatisfactory. I regret that to date the ramblers have not responded to our invitation. They would be welcome if they came forward. We would like to hear their views in detail on that basis.

    Dairy Industry
    Mr. Wareing: To ask the Minister of Agriculture, Fisheries and Food when he last met representatives of the dairy industry to discuss problems facing the industry. [4136]
    Mr. Baldry: My right hon. and learned Friend the Minister and his ministerial colleagues regularly meet representatives of the dairy industry to discuss issues of importance to them.
    Mr. Wareing: When the Minister next meets representatives of the dairy industry, will he bring to their notice the scandal highlighted in The Observer involving at least two farms that recycle milk which is past its sell-by date, mix it with fresh milk and sell it through supermarkets to the general public? Furthermore, will he carry out a thoroughgoing investigation to ensure that there are not other examples in other parts of the country, and enforce the dairy hygiene regulations that were brought into law this year?
    Mr. Baldry: If there are any breaches of the regulations, and the breaches are known about, prosecutions follow. It is as straightforward as that.
    Mr. John Greenway: During his discussions with dairy farmers, has my hon. Friend received any representations about the effect of bovine spongiform encephalopathy on dairy farm incomes? Does he agree that it is a touch inconsistent for the Labour party to complain that our schoolchildren are not being given enough milk to drink, when it considers it to be perfectly okay to ban beef in school canteens? Is it not about time that hon. Members on both sides of the House recognised that both the milk and the beef produced by farmers in this country are of very wholesome quality—the finest of any country in the European Union? The milk is safe to drink and the beef is safe to eat, and both should be available in all schools.
    Mr. Baldry: I just think that every local authority should calmly and quietly consider the chief medical officer's advice on the subject.
    Mr. Tyler: In view of those comments, will the Minister give us an assurance that the statement by the Parliamentary Secretary, the hon. Member for Tiverton (Mrs. Browning), to me in the debate in July—
    "We have never ruled out categorically either vertical or horizontal transmission"—[Official Report, 13 July 1995; Vol. 263, c. 1186.]—
    still represents the Government's position? What steps will he now take to reassure not only consumers but the many people in the livestock industry who are genuinely confused by the Government's advice, so that we can have some credible advice and guidance?
    Mr. Baldry: I do not think that there is any confusion whatever in Government advice. Any livestock farmer simply has to read the advice of the chief medical officer or the chief veterinary officer to see that there is no confusion. Any confusion simply comes from some sections of the media, and others who have a vested interest in causing confusion in that area. There is no confusion and no doubt; the message is clear from the best scientific reports by both the chief medical officer
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    and the chief veterinary officer, and if people calmly and quietly read those, a sense of proportion will be brought back into the debate rather more speedily.

    Agricultural Efficiency
    Mr. Pawsey: To ask the Minister of Agriculture, Fisheries and Food what assessment he has made of the relative efficiency of agriculture in the United Kingdom and in other major EU countries. [4137]
    Mr. Douglas Hogg: I believe that United Kingdom farmers can compete effectively with their counterparts in other major countries of the European Union.
    Mr. Pawsey: I am grateful to my right hon. and learned Friend for confirming the efficiency of the British farming industry. However, does he agree that the nonsense of the CAP distorts the free market, and that its cost—the billions that it costs British taxpayers—enables less efficient foreign industries to compete unfairly with the United Kingdom industry?
    Mr. Hogg: There are indeed serious defects in the CAP, to some of which my hon. Friend has drawn attention. We have been forward in pressing the case for far-reaching reform of the CAP, and Commissioner Fischler has now produced a paper accepting that the status quo is not sustainable. I welcome that fact, and we shall push for substantial reform.
    Mr. Campbell-Savours: While we are talking about the efficiency of milk producers, if the Minister of State can really buy four pints of milk for 26p, will the right hon. and learned Gentleman advise his colleague to resign his seat and go into the milk business, to buy a milk tanker, take it round to his local supermarket and fill it up with milk in the half-gallon bottles that it sells, and then sell that milk to a farmer, so that the farmer can sell it on to a milk processor? If he did that, he would make a 100 per cent. profit.
    Mr. Hogg: It is quite plain that the hon. Gentleman was not listening to my hon. Friend the Minister of State. I should add that my hon. Friend has many talents, and I am sure that he would make a splendid milkman.
    Mr. Dykes: May I urge my right hon. and learned Friend to visit the three very efficient farms in Harrow, East? It is always an interesting phenomenon to visit urban farms. Will he confirm that one of the ways of enhancing the efficiency of Britain's farms would be to adopt the single currency, bearing it in mind that the National Farmers Union now endorses such a policy?
    Mr. Hogg: My hon. Friend has represented many interests in his time in the House of Commons, but I did not know that he was such a prominent spokesman for the agricultural community. I am delighted to hear that there are three farmers in Harrow, East. That community will be the easiest to meet in its totality.
    Mr. Simpson: I am glad that the Minister is keen to recognise the efficiency of our agriculture industry. Will he explain why this country currently has a trade deficit of £6 billion in food and drink, 63 per cent. of which is with countries that have no climatic advantage over the United Kingdom? Will he explain the compelling logic and virtue of agriculture policies that have seen imports from the EC increase by 20 per cent. since 1980 and

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    exports decrease by 3 per cent.? If we have an efficient agriculture industry, what is the point of a policy that discourages Britain's ability to provide its own food?
    Mr. Hogg: There are two points to be made. First, the hon. Gentleman is enunciating a policy of fortress Britain, which—whatever else may be true about it—is incompatible with the policy of Opposition Front Benchers. Secondly, on a point of specific detail, if he contrasts food exports last September—the latest available figures—with the previous year, he will see that our exports have gone up by 10 per cent., whereas imports have gone up by 4 per cent. In other words, exports are doing rather well at the moment.

    Apples
    Mr. Jacques Arnold: To ask the Minister of Agriculture, Fisheries and Food what efforts he has made to improve the marketing of British apples. [4138]
    Mr. Boswell: We have a range of assistance to help our growers. For example, we paid a marketing grant of £150,000 towards establishing the largest top fruit marketing group, and have seconded a leading horticulturist to boost exports. These complement the welcome efforts of the industry itself.
    Mr. Arnold: I welcome the Government's support for the marketing of apples because, as my hon. Friend knows, the best apples in Britain are grown in Kent. How does it help the marketing of those apples if massive subsidies are made for the production of apples on the continent? In particular, may I draw my hon. Friend's attention to the subsidy of FF240 million to French apple producers and the subsidy of 11.6 million Dutch guilders to Dutch producers? How do those subsidies help British producers get their excellent apples to the market?
    Mr. Boswell: Our help to the British apple industry and its exports and marketing is well targeted. Any assistance given by other member states to their producers—especially in areas of production and surplus—will be subject to the most rigorous scrutiny and, if necessary, will be referred to the European Commission.
    Mr. Foulkes: Is it true that relations between the Deputy Prime Minister and the chairman of the Tory party have sunk so low that the Deputy Prime Minister has been reduced to eating an apple a day?
    Mr. Boswell: With great respect to the hon. Gentleman, I advise him to eat an apple a day—he will then feel a great deal better himself.
    Sir Roger Moate: Given the general agreement in this country, on both sides of the House and in the industry that the present intervention system, particularly for apples, is quite intolerable—it is bad for the consumer, bad for the taxpayers and very bad for British apple growing—will my hon. Friend get a message to the Prime Minister in Madrid that we must not accept any deal that imposes for any length of time a continuation of that intolerable and unacceptable intervention system?
    Mr. Boswell: My hon. Friend has great knowledge of the apple industry, which is an important interest in his part of Kent. I agree that the intervention system is harmful. We are entirely opposed to it and we have registered that opinion with the Community. We look
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    forward to continuing negotiations towards a satisfactory outcome that removes the difficulties, costs and wastefulness of the current system.

    Bovine Spongiform Encephalopathy
    Mr. Gordon Prentice: To ask the Minister of Agriculture, Fisheries and Food what is the total number of cases of BSE confirmed in the United Kingdom at the latest available date. [4139]
    Mr. Douglas Hogg: As at last Friday, 155,832 cases of BSE had been confirmed in the United Kingdom. I regularly meet industry representatives to discuss BSE.
    Mr. Prentice: Those are disconcerting figures. How can the Government conceivably hope to reassure the public when they are ordering redundancies at the Institute of Animal Health in Edinburgh, where scientists are working at the leading edge on BSE and its human equivalent? They have been told that they have until next Thursday to come up with redundancies in order to meet the Government's target. The Minister has an opportunity now to repudiate that policy and say that it will be reversed. It is appalling.
    Mr. Hogg: There are two points wrapped up in that question. The first relates to the statistics. The number of confirmed cases is declining. This time last year there were about 28,500 confirmed cases; this month there are about 16,500. In other words, we are seeing a decline of about 40 per cent. That is certainly encouraging.
    On the substantive point, there are no financial restrictions on research. On the contrary, we have put another £1 million into research for next year. I asked Professor Pattison, the chairman of the independent advisory committee, whether he saw any financial restrictions on research and he said no.
    Mr. French: In tackling the problem of BSE, does my right hon. and learned Friend accept that it is one thing to pass regulations on the content of feedstuffs and slaughterhouse procedures but a different thing to ensure 100 per cent. enforcement of those measures? What recent steps has my right hon. and learned Friend taken to increase enforcement?
    Mr. Hogg: It is important to stand back on the question of BSE. There are two important points to make: first, we do not believe that BSE in cattle can be transmitted to humans. The scientific evidence is reassuring on that point, although it does not enable us yet to prove that it cannot be transmitted. Against the possibility that we might be wrong, we have in place very rigorous regulations to prevent specified bovine offal—the material capable of carrying the infective agent—from getting into the food chain. I have given clear instructions to the Meat Hygiene Service to ensure 100 per cent. compliance with the regulations. I called in the slaughterhouse operators on 9 November to give them the same message.
    Dr. Strang: Is the right hon. and learned Gentleman aware that we welcome the tightening of BSE controls announced today? Does he agree that it was unacceptable that the existing controls were not adequately enforced, for which the Government must accept their share of responsibility? Does he agree that we should err on the side of caution when it comes to BSE? Will the Minister announce today that he accepts the recommendation of

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    the Agriculture Select Committee that we should ban the brains, spinal cords and other specified offal of cattle under six months from entering human food?
    Mr. Hogg: On matters of scientific evidence, I follow the advice of the independent advisory committee. We have done so throughout, which enables us to say with complete confidence that British beef is safe. On the first part of the hon. Gentleman's question, he is doing himself no credit. There are no party runs to be scored on the matter. If he tries to score them, he will simply make a clown of himself.

    Tenanted Sector
    Mr. Alexander: To ask the Minister of Agriculture, Fisheries and Food what steps he has taken to revitalise the agricultural tenanted sector. [4140]
    Mr. Boswell: The Agricultural Tenancies Act 1995, which came into force on 1 September, is designed to encourage landowners to let more land. The Act gives landlords and tenants much greater freedom to agree farm business tenancies that reflect their needs.
    Mr. Alexander: I thank my hon. Friend for that reply, but is not the aim that he described rarely realised in practice? When a smallish block of 60 or 70 acres comes on the market, the young farmer does not get it because he is outbid by a neighbouring larger enterprise. According to the aims of the 1995 Act, one would have expected the younger person to be able to take it on.
    Mr. Boswell: The Act has been in force for less than three months and it is early to assess its results, but the survey carried out by the Royal Institution of Chartered Surveyors, preparatory to the introduction of the Act, forecast that there would be increased opportunities generally, with a probability of a 10 per cent. overall uplift in the amount of land available for letting on tenancies of longer than a five-year term. I have every hope that, as the market settles down, there will be opportunities for new entrants.

  PRIME MINISTER

    Engagements
    Mrs. Anne Campbell: To ask the Prime Minister if he will list his official engagements for Thursday 14 December. [4157]
    The Deputy Prime Minister (Mr. Michael Heseltine): I have been asked to reply.
    My right hon. Friend the Prime Minister is in Paris signing the Dayton agreement on Bosnia.
    Mrs. Campbell: Will the Deputy Prime Minister unequivocally condemn the remark made yesterday by his right hon. and learned Friend the Chancellor of the Exchequer, when he said:
    "This bottom 10 per cent. always drive me up the wall"?
    Will he further apologise to that bottom 10 per cent., who have seen a real fall of 17 per cent. in their living standards since the Conservative Government took office?
    The Deputy Prime Minister: My right hon. and learned Friend the Chancellor of the Exchequer was referring to those people who have significant wealth but
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    low incomes, which can give a wholly misleading idea of their overall position and the standard of living that they enjoy. The hon. Lady is giving a false impression of what he was saying.
    Sir Anthony Grant: Is my right hon. Friend aware that the best service that my right hon. and learned Friend the Chancellor can render to the lowest 10 per cent. and, indeed, the highest, is to reduce interest rates as much as possible and that his decision is much to be congratulated?
    The Deputy Prime Minister: My right hon. and learned Friend the Chancellor is presiding over one of the most exciting periods of British economic potential. [Interruption.] I am sure that a wider audience will notice that Labour Members jeer at the fact that, for the 27th month in a row, unemployment fell. It was 20,000 less month on month and has been nearly 750,000 down over the 27 months. I should have thought that Labour Members would cheer on behalf of their constituents.
    Mrs. Ann Taylor: As the Prime Minister was unable to give any figure for the cost of rail privatisation at Question Time on Tuesday, will the Deputy Prime Minister confirm that the Government's figures, following the Budget, show that the long-term cost to the taxpayer will be £850 million per year?
    The Deputy Prime Minister: The hon. Lady has the quotations wrong. Those quotations come from a Labour party press release. Like most Labour party press releases, they are unadulterated rubbish.
    Mrs. Taylor: Will the Deputy Prime Minister therefore take the trouble to look at the sources of the figures in those documents, every one of which is a published Government source? Will he further look at the report of the Select Committee on Transport published today, which also shows that, if rail privatisation goes ahead, taxpayers will have to pay hundreds of millions of pounds extra to keep services as they are? Is not the message clear: rail privatisation is a waste of taxpayers' money?
    The Deputy Prime Minister: If the hon. Lady and the Labour party are so against privatisation, why have they not got the guts to renationalise any of the industries that we have privatised? Why is it that every time we take the process a step further, they jeer and produce scare stories in advance, none of which stands up when we achieve the result?
    Mr. John Townend: I congratulate my right hon. Friend and the Government on the unemployment figures that he has just mentioned—8 per cent. and falling, whereas unemployment in France is 11.5 per cent. and rising. To what extent is that due to the franc fort policy and French membership of the exchange rate mechanism, while we have a free and floating pound?
    The Deputy Prime Minister: My hon. Friend gives me the opportunity to pay tribute to all those industrialists in this country who have helped to create the jobs in the enterprise culture that we have designed as a Government. What I find extraordinary about the Labour party and the issue of unemployment is that last month, when there was a 200 increase in unemployment, the shadow Employment Secretary put out a press release in which he said that that recognised
    "the final collapse of the Government's shuddering economic recovery."

    1097
    The fact is that those figures have now been revised and we have discovered that last month, as in each of the past 27 months, unemployment fell. Why does not the Labour party recognise that far from a shuddering economic recovery, we have a buoyant economic attitude in this country which is creating wealth at one of the fastest rates in western Europe?
    Mr. Beith: Have the Deputy Prime Minister and his colleagues considered the point of order made by my hon. Friend the Member for Liverpool, Mossley Hill (Mr. Alton) that it would be an outrage if social security regulations that could make 10,000 people homeless and destitute were to be implemented before Parliament had had a chance to debate them?
    The Deputy Prime Minister: The right hon. Member raises an important question. I can assure him and the House that there will be an opportunity to debate these matters before they are implemented. I give that assurance.
    Mr. Duncan Smith: Did my right hon. Friend notice in yesterday's Hansard a very good Bill on protecting those who wish to disclose information in the public interest? Has he further noticed that there are serious problems here in the House for those who might wish to do that? I particularly refer to members of the press corps who have been cajoled and coerced, I gather, by some strange people: a shadowy figure from Hartlepool and an ex-journalist from Today. Will he join me in encouraging them to break free from that and blow the whistle on that strange shadowy company over there?
    The Deputy Prime Minister: My hon. Friend makes an important point. Conservative Members have raised it before but no answer comes. Is it the intention of the Labour party, if elected to power, to put Alastair Campbell as a civil servant into No. 10 Downing street to inject Labour party propaganda into the presentation of Government policy?
    Mr. Jim Cunningham: To ask the Prime Minister if he will list his official engagements for Thursday 14 December. [4158]
    The Deputy Prime Minister: I have been asked to reply.
    I refer the hon. Member to the answer I gave some moments ago.
    Mr. Cunningham: Does the Deputy Prime Minister agree that the £850 million on-going cost of rail privatisation would be better spent on improvements to the west coast main line, which serves my constituency?
    The Deputy Prime Minister: What I do believe is that offering the private sector the chance to provide the cash for the innovation and modernisation that we all want is much more likely to achieve the result than continuing with nationalisation, which I notice, significantly, has not achieved that result over the years.
    Mr. Rowe: Has my right hon. Friend noticed that of all the counties in England, Liberal and Labour-run Kent county council retains the largest share of its education budget at the centre? How does that sit with the oft-repeated complaints from the Opposition that too much is spent by the Government on administration?
    The Deputy Prime Minister: It is wholly consistent with the theme of what the Opposition say. Most
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    conspicuously, they will not say that they will put up taxes but they constantly talk about the need for increased expenditure. They want it all ways, which proves that the sums do not add up and that they are not fit to govern.
    Mr. Keith Hill: To ask the Prime Minister if he will list his official engagements for Thursday 14 December. [4159]
    The Deputy Prime Minister: I have been asked to reply. I refer the hon. Member to the reply that I gave some moments ago.
    Mr. Hill: Does the right hon. Gentleman understand my sense of shock this morning as I witnessed the evidence of wanton destruction and looting in central Brixton and parts of my Streatham constituency? Will he join me, my hon. Friend the Member for Vauxhall (Miss Hoey) and the vast majority of the local community in condemning those acts of violence? For the sake of Brixton's reputation and future, will the right hon. Gentleman also affirm that the acts that we witnessed yesterday evening were not a re-run of the events of 1981 and 1985, as has been portrayed, but the actions of a small criminal element? Finally, will he confirm that there is no intention of backtracking on the regeneration funding committed to the locality and that Brixton's future will be reassured, as is the will of the local people?
    The Deputy Prime Minister: I unreservedly join the hon. Gentleman in condemning the violent minority who attacked police officers and property in Brixton last night. I wholeheartedly agree with the Commissioner of Police of the Metropolis, representatives of the local community and the hon. Member for Vauxhall (Miss Hoey), who spoke eloquently this morning in condemnation of those unacceptable acts of violence, which we all deplore. If we are to bring hope and opportunity to those urban communities, it is vital that they become attractive places for people to live, work and invest. All parties have made a massive attempt to bring that about in the past few years, and that process must continue.
    Mr. Luff: Will my right hon. Friend confirm that neither he nor the Prime Minister would ever contemplate threatening the Union by introducing an elected Scottish Parliament? If they were ever tempted by such an idea, will he confirm that they certainly would not think of giving it tax-raising powers and then try to deceive the British people by saying that they would not use those powers?
    The Deputy Prime Minister: It is extraordinary that Scottish Labour Members of Parliament are to contemplate a tartan tax to make taxes higher in Scotland than in the rest of the United Kingdom. I also find it extraordinary that English Labour Members of Parliament are prepared to give powers to their Scottish colleagues, which would be exercised by Scottish Members in England, while English Labour Members would have no such powers in Scotland.
    Mr. Raynsford: To ask the Prime Minister if he will list his official engagements for Thursday 14 December. [4160]
    The Deputy Prime Minister: I have been asked to reply. I refer the hon. Member to the reply that I gave some moments ago.
    Mr. Raynsford: Does the Deputy Prime Minister recognise that it is not only with British Rail that

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    privatisation has been taken too far? Is he aware of the anger and indignation felt by people in Britain at the appearance in an estate agent's brochure of the magnificent complex of buildings in Greenwich currently occupied by the Royal Naval college? Is he also aware that the Secretary of State for Defence refuses to reveal the organisations that are bidding to take over those magnificent buildings? As it comes hot on the heels of the fiasco of county hall, is it not clear that the nation's heritage is not safe in the Government's hands?
    The Deputy Prime Minister: If the hon. Gentleman believes that, he will believe anything. As the Prime Minister and my right hon. Friend the Secretary of State made clear, the preservation of the buildings at Greenwich is of prime national importance and nothing will be done to prejudice it.
    Mr. Anthony Coombs: As unemployment has now been falling for 27 months in a row, has my right hon. Friend noticed the recent comments by the Director-General of the CBI, who said that a combination of increasing social regulations from Europe via the social chapter and a single currency would be "an employment-destroying disaster"? Does not that show the importance of the opt-out that we achieved at Maastricht and the hypocrisy of those who talk about creating jobs but then support policies such as the social chapter and European monetary union, as the Opposition do?
    The Deputy Prime Minister: I shall have the opportunity tomorrow to lay the foundation stone of Siemens in the north-east. One of the reasons why a German company comes to invest and create jobs in this country is that we do not have the impost of the social chapter, whereas Germany has. I would have thought that Labour Members, whose constituencies have gained enormously from the inward investment coming to this country, would seek to enhance it, and not to destroy it.
    Mrs. Clwyd: To ask the Prime Minister if he will list his official engagements for Thursday 14 December. [4161]
    The Deputy Prime Minister: I have been asked to reply. I refer the hon. Member to the answer I gave some moments ago.
    Mrs. Clwyd: Has the Deputy Prime Minister noted the good news from south Wales that Tower colliery in my constituency, which was bought by the workers a year ago, has made a pre-tax profit of £3.5 million in the first year? [Interruption.] That has been achieved despite the fact that the right hon. Gentleman told those workers that there was no market for their coal. Is not the lesson to be learnt that if the conditions are right—[HON. MEMBERS: "Privatisation."]
    Madam Speaker: Order. The hon. Lady must be heard.
    Mrs. Clwyd: Is not the lesson to be learnt that if the conditions are right, and if workers are given control of the means of production—[Interruption.]
    Madam Speaker: Order. Hear the hon. Lady out. [Interruption.] Order. Hear the hon. Lady out.
    Mrs. Clwyd: If the workers are given control of the means of production they can turn in profits, whereas the capitalists throw in the towel.
    The Deputy Prime Minister rose—
    Madam Speaker: Order. Control yourselves.
    The Deputy Prime Minister: I do not want to intrude on private grief, but perhaps the hon. Lady has not caught up with events. Those words have been deleted from the clause, although I realise that a large number of her right hon. and hon. Friends are just waiting their time to bring them back. The hon. Lady had better have a word with the hon. Member for Hartlepool (Mr. Mandelson) because she has got the language wrong—the soundbite does not fit with the language of those on the Opposition Front Bench. The real message behind what the hon. Lady has just said, the real triumph, is that it is privatisation that has made those profits possible.

Business of the House
3.32 pm
Mrs. Ann Taylor: May I ask the Leader of the House for the details of future business?
The Lord President of the Council and Leader of the House of Commons (Mr. Tony Newton): The business for next week will be as follows—
MONDAY 18 DECEMBER—Proceedings on the Consolidated Fund Bill.
Remaining stages of the Hong Kong (Overseas Public Servants) Bill.
Motion on the Copyright and Rights in Performances Regulations.
Debate on Her Majesty's Stationery Office in relation to its future work for Parliament on a motion for the Adjournment of the House.
TUESDAY 19 DECEMBER—Until 7 o'clock, debate on the common fisheries policy on a Government motion.
Motion relating to Scottish Standing Orders.
WEDNESDAY 20 DECEMBER—Until 2 o'clock, there will be debates on the motion for the Adjournment of the House, the first of which will be the traditional three-hour debate held just before a recess in which I have to answer for everyone on everything.
Proceedings on the Humber Bridge (Debts) Bill.
I expect to make a statement next week about business after the recess.
Mrs. Taylor: I thank the Leader of the House for that limited information. He will be aware that I am extremely pleased that we are to have a debate on HMSO next week, so that we can assess the feelings of the House with regard to the privatisation, and the impact it might have on us in Parliament. That debate will be on an Adjournment motion. Can the Leader of the House give us a promise that, before the privatisation takes place, the House will be able to vote on whether it is wise to proceed in that way, especially as that particular privatisation will directly affect the House?
Secondly, the Deputy Prime Minister said earlier this afternoon that the proposed regulations on asylum and the withdrawal of benefits are not to be implemented before being debated in the House. We are pleased that the Government have responded to our representations. Will the Leader of the House state exactly when those regulations will be laid, when they will be debated and when they are expected to come into operation?
Thirdly, I have raised on previous occasions with the Leader of the House the "Day of the Jackal" loophole in relation to access to birth certificates. The subject was raised again last Monday by my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) in the debate on the Asylum and Immigration Bill. On Monday, the Home Secretary said that he would like to take action on that loophole, but that he did not think that there was sufficient legislative time. As we are not under great pressure during this parliamentary Session, may I press the Leader of the House on what the Government intend to do about that loophole?
The pressure on parliamentary time itself becomes an issue when we hear that the Government have, in an announcement in Committee today, delayed the
1102
implementation of the new student loans scheme. As we have not yet seen the Bill expected from the Department for Education and Employment on nursery vouchers, surely we are right to conclude that the Government's legislation is in chaos. If we could make practical proposals, surely discussion of them would be a better use of parliamentary time than debating some of the Bills that might not end up on the statute book or be implemented.
Mr. Newton: I shall take those questions in order. No specific parliamentary procedure is required for what the Government are proposing in relation to HMSO. The first step is, as the hon. Lady has rightly acknowledged, to allow the House a proper opportunity to express its views on House aspects of the matter, in line with Madam Speaker's request. That is how we should proceed.
The hon. Lady has heard and welcomed what my right hon. Friend the Deputy Prime Minister said during Prime Minister's questions about asylum benefits. The regulations will be laid before the House as soon as the Secretary of State for Social Security has had an opportunity to study the report, which he has only recently received from the Social Security Advisory Committee. We expect the regulations to come into force next year, but I repeat the firm assurance given by my right hon. Friend the Deputy Prime Minister that they will not be implemented until the House has had the opportunity to debate them.
On the issue of what the hon. Lady calls the "Day of the Jackal" loophole, I have not had an opportunity to discuss the position since the exchanges on Monday. But I shall do so and give the hon. Lady an appropriate response.
Lastly, on the subject of legislation—particularly education legislation—I understand that my hon. Friend the Minister of State has said that the Government think that it will be appropriate to start the student loans scheme in 1997 rather than 1996. That proposal was made in Standing Committee this morning.
Sir Fergus Montgomery: Before the House rises for Christmas, will my right hon. Friend consider having a debate on democracy? An article in yesterday's edition of the Daily Mail, following the sad death of our friend, Sir David Lightbown, said that the Labour party was thinking of getting the hon. Member for Stratford-on-Avon (Mr. Howarth) to resign and force a by-election. It stated that the hon. Member for Stratford-on-Avon would—in the paper's words, not mine—be imposed upon—
Mr. Andrew Faulds: No quoting.
Sir Fergus Montgomery: I am not quoting.
Mr. Faulds: He is.
Madam Speaker: The hon. Gentleman is not quoting. He is attempting to speak if given the opportunity by other hon. Members to do so, and I shall see to it that he is given that opportunity. The hon. Gentleman should speak up.
Sir Fergus Montgomery: It said that the hon. Gentleman would be "imposed" upon South-East Staffordshire. I lived in Staffordshire for some years and I assure my right hon. Friend that the people there are very independent. I do not think that they would like to have a

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turncoat "imposed" on them. A debate on democracy might provide an opportunity to flush out the Machiavellian princes of darkness who seem to inhabit the Labour party and who have such contempt for democracy.
Mr. Newton: I certainly understand why my hon. Friend has raised the issue: Conservative Members find the notion of imposing candidates from the centre quite extraordinary.
Mr. David Rendel: Following the Deputy Prime Minister's very welcome announcement that the social services orders will not come into effect until the House has had a chance to consider them, will the Leader of the House also give an assurance that they will not come into effect until the Social Security Select Committee has concluded its consideration of them?
Mr. Newton: I cannot give that latter assurance at the moment—not least because, according to my inquiries this morning, it is not clear precisely when the Social Security Select Committee . intends to conclude its deliberations. The assurance that the Deputy Prime Minister and I have given provides the Social Security Select Committee with an opportunity to express its views if it wishes to do so.
Sir Jim Spicer: Will my right hon. Friend find time in the new year for a debate on responsibility in local government? I ask for such a debate against the background of events this morning in Dorset, where the Liberal-controlled county council has forced through a ban on beef products in all of our schools against the advice of the chief medical officer and the committee examining bovine spongiform encephalopathy. The council, which is run by a small cabal who force their views upon the people of Dorset, issued a diktat and the schools had no chance to state their views. I believe that such a debate may prove very useful if we can find time for it.
Mr. Newton: I shall consider what my hon. Friend has said. There will be a further opportunity to debate local government matters generally when the local government finance orders are brought before the House in the usual way fairly early in the new year.
Mr. Alfred Morris: I draw the attention of the Leader of the House to my early-day motion 144:
[That this House, mindful of the increasing needs of the United Kingdom's ageing ex-service population and the many problems of younger members of the ex-service community, in direct consequence of Options for Change, considers that there is now a pressing need for a sub-department of Ex-Service Affairs within an existing Ministry and with a designated Minister to be responsible, as the only fundamental and long-term solution for the care and welfare of ex-Service people and their dependants; and calls upon Her Majesty's Government now to respond positively to the Royal British Legion's urgent call for a sub-department to be established.]
It is concerned with the care and welfare of ex-service people whom the Royal British Legion supports so strongly. In particular, has he seen that the motion has now attracted the support of a virtual majority of Members of Parliament who are at liberty to sign such motions? Can we have at least an oral ministerial statement next week on the Government's response?
Mr. Newton: I do not recall whether the right hon. Gentleman was present when the matter was debated on
1104
the Floor of the House earlier this year, but ministerial comments were made during that debate. The Government believe that the creation of a Department that is specifically responsible for former service people in the way that the right hon. Gentleman suggests would simply add another tier of administration without improving the present arrangements. We believe that the provision for former service personnel is best integrated with that for the community as a whole.
Mr. Allan Stewart: Will my right hon. Friend enlighten us about the debate on Scottish Standing Orders to which he referred? Will that debate provide an opportunity for all hon. Members to discuss the fact that the Leader of the Opposition, in his recent interview and during his visits to Scotland, wholly repudiated the claim of right and personally humiliated the shadow Secretary of State?
Mr. Newton: It is not for me to pre-empt your views, Madam Speaker, as to what would or would not be in order during a debate on the Standing Orders, which are concerned principally with the role of the Scottish Grand Committee—but no doubt my hon. Friend will have a try.
Mr. Harry Cohen: Although I agree with the comments of my hon. Friend the Member for Streatham (Mr. Hill) during Prime Minister's questions objecting to the violence in Brixton, it would be very foolish for hon. Members to believe that there was no just cause for it—yet another death of a black person in police custody. There have been more than 70 such deaths in the past decade and the families involved cannot get justice or even evidence of what has occurred. They believe that the system is rigged and if they cannot have the matter heard in the House they will take to the streets. When will Parliament debate black deaths in custody so that the system may be changed properly?
Mr. Newton: In view of the implications of what the hon. Gentleman has said, perhaps he should discuss them first with his hon. Friends who were sitting two Benches in front of him not long ago. They clearly stated that they considered that a small criminal element had been responsible for those activities, and did not attempt to justify them as the hon. Gentleman has. In my view they were right, and the hon. Gentleman would do well to reconsider what he has said.
Mr. Nicholas Winterton: Does my right hon. Friend accept that there is considerable concern among Members on both sides of the House—particularly Conservative Members—about the on-going influence and authority of the BBC's overseas service? While there might be grounds for adjusting its capital budget, many of us feel that there is no justification for reducing its operating budget. Will my right hon. Friend try to find time for a short debate on the subject?
Many of us are also concerned about cuts in capital spending, especially when they affect the future economic progress of our constituencies. Will my right hon. Friend try to find time for a debate on infrastructure capital spending? My constituency will be affected if urgent road projects do not proceed in the foreseeable future.
Mr. Newton: I shall always consider suggestions such as those made by my hon. Friend. I should point out, however, that funds for the World Service have increased by 50 per cent. in real terms since 1980. The current

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proposals entail virtually no change in the allocation for current costs—this deals directly with a point made by my hon. Friend—and are directed mainly towards the capital side.
I think my hon. Friend will acknowledge that, in this context as in others, there is significant scope for private funding under the increasingly successful private finance initiative.
Rev. Martin Smyth: The Leader of the House will know that we have heard statements on Scottish and Welsh expenditure. Northern Ireland, however, has again had to be content with a press release. I understand that the House, not the press, votes Supply. In future, will it be possible for a statement on public expenditure in Northern Ireland to be made in the House rather than in a press release?
Mr. Newton: That question is linked with one that the hon. Gentleman asked me last week, to which I undertook to give further consideration. Let me answer them both at once. This year, the Secretary of State for Scotland made his statement about local government expenditure to the Scottish Grand Committee.
Mr. Toby Jessel: As to next Wednesday's debate on the Humber Bridge (Debts) Bill, I was the defeated Conservative candidate in the Hull, North by-election in January 1966, nearly 30 years ago. In the course of the by-election, Mrs. Barbara Castle promised to build a Humber bridge, which has already cost public funds well over £400 million—perhaps not far short of £500 million—which kept me out of the House for four years and which costs the taxpayer £100 million a year. Will there be time in Wednesday's debate for us to discuss whether that amount—nearly £500 million—should be charged to the Labour party and not to the unfortunate taxpayer, as a consequence of Labour's disgraceful electoral bribe?
Mr. Newton: I profoundly hope that there will be time for the matter to be discussed.
Mr. Andrew Welsh: May I draw the right hon. Gentleman's attention to an article in today's Glasgow Herald about the transfer of media monitoring from the Scottish Office to a private company, and the dangers of funding party political propaganda from the public purse? That directly contradicts the statement made to me by the Secretary of State for Scotland in the Scottish Grand Committee that he knew nothing about the matter.
I am sure that the Leader of the House did not intend misleading the Scottish Grand Committee to be one of the new Scottish procedures. Will he arrange for a statement to be made to clarify the matter?
Mr. Newton: I shall arrange to be better informed about it before next week's debate on the Standing Orders.
Mr. Jacques Arnold: May I support the earlier call for a debate on the imposition of candidates? During such a debate I would be able to highlight the plight of Gravesham Labour party, which has had a women-only short-list imposed upon it. That constituency party has responded with an overwhelming majority against the imposition. It sent a resolution to the Labour party head office in Walworth road opposing
1106
the imposition. The response was a diktat saying that it does not matter what Gravesham Labour party thinks about it—
Mr. John Austin-Walker: On a point of order, Madam Speaker.
Madam Speaker: Order. My attention is distracted at the moment. I have a point of order, but I have not heard it. I shall take points of order afterwards. The point of order obviously relates to what the hon. Member for Gravesham (Mr. Arnold) is saying so I shall caution him so that I do not have a point of order later.
Mr. Arnold: May I point out that the reaction of the local Labour spokesman was to say that, despite the fact that there had been an overwhelming majority vote against the imposition in the constituency, this is new Labour democracy?
Mr. Newton: I hope that I will not tempt any hon. Member to make a point of order. I shall merely repeat my earlier observation that, to Conservatives, the way in which the Labour party proceeds in these matters seems quite extraordinary and indefensible.
Mr. D. N. Campbell-Savours: The Leader of the House may recall that Madam Speaker kindly afforded me an Adjournment debate on the activities of Campbell's Soups in my constituency. He may know that I am campaigning throughout the country to advise the wider public not to buy Fray Bentos or Campbell's Soups products. I wish to teach Campbell's Soups a lesson: that it should reconsider its disgraceful decision to close a highly profitable plant in my constituency. In light of the fact that an American multinational company, in which the majority of shares are held by one family, took such a decision through its British subsidiary, is not there now a need to debate how multinational companies are able to operate within the free market system?
Mr. Newton: The United Kingdom has gained enormously over the past few years from investment by a wide variety of companies, many of which could no doubt be described as multinationals. They have provided many tens, if not hundreds, of thousands of jobs. One of the reasons why they come here is that they feel that our business environment is one in which they can take decisions on a commercial basis. We would be very unwise to tamper with that environment.
Mr. Edward Garnier: Will my right hon. Friend find an early opportunity to have a debate on education so that I can draw the House's attention to the success of the application made by Beauchamp college in my constituency to become a technology college, as announced yesterday by my right hon. Friend the Secretary of State? May I also invite him to schedule such a debate so that we can draw to the attention of the parents of children attending the Robert Smythe school in Market Harborough in my constituency the benefits of grant-maintained status, a status already enjoyed by three other schools in my constituency and which I am sure will also be enjoyed by the parents, teachers and governors of the Robert Smythe school?
Mr. Newton: I hope to provide many opportunities to debate education in the new year when we publish the

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Bill relating to nursery and grant-maintained schools to which the hon. Member for Dewsbury (Mrs. Taylor) adverted in her opening question.
Mr. David Winnick: I am glad that there seems to be broad agreement in the House about the need to tighten legislation on knives. In view of the terrible tragedies that have occurred and which I mentioned on Monday, why is it necessary for the Home Secretary to nit-pick with my hon. Friend the shadow Home Secretary? Would not it be useful if the Home Secretary were to come to the House early next week and say that he will meet my hon. Friend to see what agreement could be reached, including the possibility—only the possibility—of making it more difficult to purchase knives in the first instance? Since there is broad agreement, why is the Home Secretary adopting a totally unnecessary confrontational style? The public recognise the need for action, and the House should deal with that.
Mr. Newton: I do not think that my right hon. and learned Friend the Home Secretary has adopted a confrontational style. He has sought to assist in the rapid response to the considerable public concern about an important matter. I am grateful to the hon. Gentleman for indicating his support for the basic propositions in the Bill brought forward by my hon. Friend the Member for Sutton and Cheam (Lady Olga Maitland).
Mr. John Wilkinson: Why has it been decided to postpone the debate on the common fisheries policy, which my right hon. Friend announced last Thursday for yesterday, until next Tuesday? Do not the Minister of Agriculture, Fisheries and Food, and others involved in the European Fisheries Council meeting at the end of next week, need the maximum amount of time to consider the representations made during the debate, so that the Government's policy on fishing may accord as much as possible with the will of the House?
Mr. Newton: The arrangement of business for the three days on which the House is sitting next week has proved rather complicated—as the House will have realised from the business I read out. It simply seemed more sensible to do it in the way I announced this afternoon. Nevertheless, the fisheries debate will be in good time to meet the primary need for a debate before the Fisheries Council which, as my hon. Friend said, is later in the week.
Mr. Harry Barnes: As we are approaching the season of good will in which families are drawn together, should not we discuss the position in Northern Ireland, where at least 258 people have been placed in exile by paramilitary groups? The families of the disappeared are still seeking the bodies of the people who have been killed. Last night, two so-called punishment beatings took place in the course of which people were kneecapped. This would surely be an appropriate time to discuss those problems and to put the matter in the correct context.
Mr. Newton: I cannot undertake to find time for a debate, at least not next week. However, I am sure that there will be widespread approval in the House for the implication of the hon. Gentleman's remarks—that we would all like an end to that kind of activity in the
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interests of the families and people involved, and of progress towards a satisfactory outcome in Northern Ireland.
Mr. Harry Greenway: May we have a debate next week on suitable locations for education referral units for secondary pupils, so that I can tell the House about the most senseless suggestion by Ealing's Labour council—that Oldfield primary school in Greenford is a suitable location for such a centre? The council's other suggestion is that a building in Islip Manor park, Northolt would be a suitable location for such a unit.
Mr. George Foulkes: Oh, God.
Mr. Greenway: I am being interrupted and shouted at by the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes). If he does not defend his constituency, I defend mine. Those units are not suitable for the places I mentioned in my constituency, and the unit should be referred to the Elthorne youth centre, which would be much more suitable.
Mr. Newton: If my hon. Friend, who is certainly a doughty defender of his constituency, were to choose to appear on Wednesday morning and raise that matter in the three-hour debate to which I have already referred, I shall try to ensure that I have an answer.
Mr. Paul Flynn: When may we debate the surprising information in a letter from the Minister for Transport in London which says that the Department of Transport, after careful, scientific calculations, has come to the conclusion that company cars are 30 to 50 per cent. more dangerous than private cars? That means an additional, probably avoidable, 6,500 to 9,250 accidents a year.
One would expect company cars to be safer, because they are driven by mature, experienced drivers; the cars are new and well maintained; and they are driven on motorways, which are safer than normal roads. Is not it vital that we have a debate to discuss how to avoid such a large number of accidents? Probably, the explanation is that the drivers do not own their cars and do not drive as safely as drivers with a financial interest in their cars.
Mr. Newton: If the hon. Gentleman's explanation is right, I suggest that it gives rise to a number of general points on which Opposition Members might like to reflect. I have not seen the letter, and the right course for me is to draw the hon. Gentleman's question to the attention of my hon. Friend the Minister for Transport in London.
Mr. Michael Fabricant: Will my right hon. Friend consider finding time for a debate on the operation of Standing Committees following the Nolan report? He will be aware that before I entered the House I was involved in the broadcasting industry for 20 years, supplying finance and services to broadcasting companies from Indonesia to Chile and from Botswana to Iceland—as well as to the BBC and Capital Radio here in London. Yet I now understand that I will not be allowed to serve on the Committee considering the Broadcasting Bill. Is that a general rule: do knowledge and qualification to discuss a subject constitute disqualification from serving on the relevant Standing Committee?
Mr. Newton: I have seen my hon. Friend's letter to Sir Gordon Downey—I hope he will not mind my

1109
mentioning it—which he kindly copied to me. I have no doubt that Sir Gordon will wish to draw it to the attention of the new Select Committee on Standards and Privileges, which my hon. Friend will doubtless have been glad to note was appointed by the House and its membership agreed in a motion last night.
Mr. Gordon Prentice: May I again press the Leader of the House for an early debate on the state of the textile industry? Two weeks ago I told him about the 129 job losses at Bairdtex in Trawden, in my constituency. This time last week I told him about the 50 job losses at Smith and Nephew. This week 61 jobs are to go at the Carrington Viyella Holmefield mill in Barrowford, where colour woven fabrics will no longer be made in any quantity. Jobs are haemorrhaging from the textile industry, which used to be the economic mainstay of my area. That is a proper issue for an urgent debate.
Mr. Newton: I cannot promise a dedicated debate, but I would once again draw attention to the opportunities next Wednesday morning, when the Leader of the House will have a chance to make some comments.
Mr. Foulkes: I should like to back up what my hon. Friend the Member for Pendle (Mr. Prentice) has just said. If there is such a debate, we can also, I hope, debate the carpet industry. In my constituency a number of jobs have been lost in the Richards carpet factory, thereby creating tremendous problems. Many hon. Members on both sides of the House would welcome an opportunity for such a debate, so I hope that the right hon. Gentleman will give it serious consideration.
Mr. Newton: I always give serious consideration to points that deserve it—and those raised by both hon. Members undoubtedly do. For the moment, however, I must point yet again to Wednesday morning, which increasingly looks as if it is going to be quite a busy time for me.

Madam Speaker's Statement
4.2 pm
Madam Speaker: I too have a short statement to make about Wednesday mornings. As the House knows, under the new Standing Order No. 10 the period from 9.30 am to 12.30 pm on three Wednesday mornings in each Session is allocated to Select Committee reports chosen by the Liaison Committee.
The Chairman of the Liaison Committee has informed me that the Committee has selected the following Wednesdays for my approval: 7 February, 24 April and 26 June. I have agreed those dates, and I think it would be helpful if they were generally known as far ahead as possible. The actual reports to be debated on those three Wednesdays will be chosen by the Liaison Committee nearer the time and notified by my office a week in advance.
The three half-hour debates on these dates, from 12.30 to 2 o'clock, are unaffected and Members should submit topics to my office in the normal way.

Point of Order
Mr. Alfred Morris: On a point of order, Madam Speaker, to correct the record. I ask the Leader of the House to accept that he was totally mistaken in saying that my motion on the care and welfare of former service people was discussed early this year. Will he also accept that when what the Royal British Legion is asking for was debated by the House the motion was carried, since when nothing has been done to give effect to that decision? Is the right hon. Gentleman aware that that caused great resentment not only in the Royal British Legion but among former service organisations generally?
Madam Speaker: That is not a point of order for me. I must not extend business questions, but I see that the Leader of the House is willing to reply so I shall allow him to do so.
Mr. Newton: I am grateful, Madam Speaker. As I am sure the right hon. Gentleman knows, because he and I have been doing business for a long time, I would not have wanted to convey a misleading impression, and I readily accept that it was not his motion that was discussed. But the issue that he has raised, as he himself acknowledged, was discussed in a debate last year, and the Government's view was made clear at that time.

ESTIMATES DAY
[1ST ALLOTTED DAY]
VOTE ON ACCOUNT, 1996-97
  Class XI, Vote 1

    Breast Cancer
    [Relevant documents: The Third Report from the Health Committee of Session 1994-95 on Breast Cancer Services (House of Commons Paper No. 324), the Government Reply thereto (Cm. 3007), and the Department of Health and Office of Population Censuses and Surveys Departmental Report 1995: The Government's Expenditure Plans 1995-96 to 1997-98, (Cm. 2812).]
    Motion made, and Question proposed,
    That a sum not exceeding £13,948,653,000 be granted to Her Majesty out of the Consolidated Fund, on account, for or towards defraying the charges for the year ending on 31st March 1997 for expenditure by the Department of Health on or in relation to hospital, community health, mental health, family health and family health service administration services, National Health Service trusts, and on related services.—[Mr. Horam]
    4.4 pm
    Mrs. Marion Roe: I am very grateful to the Select Committee on Liaison for recommending that the House debates this estimate in so far as it relates to the very important topic of breast cancer services. I shall, of course, concentrate on the report published recently by the Select Committee on Health, which I have the honour to chair. The recommendations of the report were unanimous.
    I should like to thank all my colleagues on the Committee for the very hard work that they put into the report, and for the very good spirit in which it was discussed. I should also particularly like to thank our specialist advisers, Professor Michael Baum of the Royal Marsden hospital and Professor Roger Blamey of Nottingham City hospital.
    I shall begin by outlining the main conclusions and recommendations of the report, and the main points of the Government's response. There are a few questions that I should like to pursue with the Minister, which I hope he will be able to address in his speech.
    Although the United Kingdom does not have a particularly high incidence of breast cancer—the disease is more prevalent in the United States of America, New Zealand, Canada and several other European countries, including France, Italy and Denmark—we have almost the highest recorded breast cancer mortality in the world. Breast cancer claims the lives of more than 13,000 women every year in England and Wales alone—more than any other cancer, and more than any disease other than heart attacks and strokes. None of our witnesses was able to offer any explanation of why breast cancer mortality should be so high in this country.
    The Government's target, set out in 1990, is
    "to reduce the number of breast cancer deaths among women invited for screening by at least 25 per cent. by the year 2000."
    It is clear from the very wording of that target that the national health service breast screening programme is at the centre of the Government's plans to reduce breast cancer mortality.

    1113
    No reduction in breast cancer mortality from the programme is expected to be observed until around 1997, as there is a "lead time", which means that the full benefits of the programme will not be observed until those women who have benefited from the early detection of their breast cancer begin to enjoy additional life years. None the less, we were impressed by the fact that the programme has met or exceeded all its interim quality indicators so far, largely as a result of its excellent quality assurance programme, and especially the efforts of its national co-ordinator.
    One of the great strengths of the quality assurance programme is that it operates not only in individual screening units but at district and regional health authority level. RHAs are responsible for purchasing quality assurance services and for the operation of the quality assurance reference centres in each region.
    In 1992, the chief executive of the NHS management executive told the Public Accounts Committee that the standards laid down centrally for the programme were "non-negotiable", and said:
    "If there are purchasers that want to try to step out of line"—
    that is, to try to purchase a service that does not meet national specifications—
    they must be brought back into line by the regions. That is the role of the region and we have made that extremely clear".
    The national co-ordinator of the NHS breast screening programme also told us that she occasionally had problems with district health authorities which were trying to purchase services that did not meet national standards. That is why the quality assurance programme is so important to the screening programme. It ensures not only that the service provided matches the service for which it is contracted, but that the service for which it is contracted meets the national requirements in the first place. We recommend that the QAP should be preserved in something like its present form after the dissolution of the regional health authorities next April. That could be achieved either by central funding of the programme or by bottom slicing from district health authority allocations.
    In their response, the Government said that they had issued guidance to the effect that
    "it is vital that quality assurance systems should continue to be funded and operated in the future to the same high standards as at present."
    The Government have also said, however, that they will move from the present system, under which RHAs are responsible for purchasing quality assurance, to a system of lead district purchasing, which will be funded through the common services levy.
    I recognise the steps that the Department is taking to ensure that the QAP continues to operate at all three levels, but I should be grateful if my hon. Friend the Minister were able to assure us that the programme will not become simply a means for purchasers to check on provider units. We must continue to ensure that the service purchased meets the national standard.
    The Select Committee on Health recommended, on the strength of the best evidence now available, that the upper age limit for inclusion in the call and recall system for screening should be extended from 65 years to 69, and
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    that the Department of Health must ensure that women over that age are aware of their right to a three-yearly mammogram on request.
    Professor Forrest's report, on the strength of which the NHS breast screening programme was originally established, suggested an upper age limit of 64, on the ground that there was lower acceptance of screening by women of older ages. It is difficult to understand what basis was used for that assertion, as the Swedish two counties study—one of the key pieces of clinical trial evidence on which the Forrest report drew—showed that 80 per cent. of women up to the age of 74 accepted invitations for screening.
    There are two good reasons, I believe, for including older women in the screening programme. First, the risk of breast cancer increases with age. Secondly, the cancer detection rate among older women is much higher than among younger women.
    Conversely, we found no evidence that extending screening to women under the age of 50 would be beneficial. None of our witnesses supported that proposal. Professor Martin Vessey of the advisory committee on breast screening explained to us that, apart from the lower incidence of breast cancer in women under the age of 50, it is also difficult to screen for breast cancer in pre-menopausal women, as
    "the hormonal environment in the breast is different"
    and the breast is much denser, making it more difficult to obtain accurate readable mammograms. The Committee was pleased to note the Government's response, which is to conduct clinical trials in screening older women.
    The NHS breast screening programme is a model service. It has strong central co-ordination, a set of auditable national performance targets, and a quality assurance programme that has been praised by the National Audit Office. However good the screening programme, however, screening alone will not lead to a reduction in breast cancer mortality.
    As we were completing our report, evidence emerged that breast cancer mortality was already beginning to fall in 1989. As I have said, such an effect could not have been generated after only two years of breast screening. It is probable that the welcome reduction in mortality is the result of improvements in the treatment of more advanced breast cancer.
    There are ways in which treatment for women with both screen-detected and more advanced breast cancer could be improved. There was a wholehearted welcome for the Government's policy framework for commissioning cancer services. The Government's plan is that cancer services should be arranged into three tiers—primary care, designated cancer units and designated cancer centres.
    The designated cancer unit will normally be a district hospital with a full range of support services for cancer patients. More importantly, however, it will have site-specific clinics for patients with the commoner cancers, led by a consultant specialist. Those will be clinics that deal with only one type of cancer, such as breast cancer or gastro-intestinal cancer.
    In practice, that means that, where there are several hospitals in one area, purchasers and providers may agree between themselves that a unit for certain cancers or groups of cancers will be established at one hospital, and

    1115
    a unit for another cancer or group of cancers in another hospital. Such clinics would also treat patients with related non-malignant conditions—for example, women with non-malignant breast problems, which account for about 90 per cent. of all breast disease, would be seen in a specialist breast unit.
    The cancer centre will be part of a large general hospital or a teaching hospital, and will offer the same range of services as the cancer unit. It will also offer specialist clinics for the less common forms of cancer, and a full range of support services for the local cancer units, including
    "those treatment regimens which are too specialised, technically demanding or capital intensive to be provided by the cancer unit."
    That could include radiotherapy, for example.
    The most important point to make about the policy framework is that it is based on sub-specialisation. It is not acceptable that a woman with a serious life-threatening disease such as breast cancer should be treated by a general surgeon who might spend most of his or her time dealing with a muddle of other surgical conditions. In addition to a specialist breast surgeon, the specialist breast unit should have a multidisciplinary team of other specialists with specific training in the management of breast disease.
    The advantages for patients in such units are manifold and great. Each unit will see enough patients to operate a dedicated clinic for new patients with breast problems each week—a one-stop shop, at which women can have all their diagnostic tests done at the same visit.
    Rapid diagnosis is of the utmost importance. It allows women who have breast cancer to receive treatment at the earliest opportunity, and permits the timely reassurance of women who do not have cancer. Patients who have breast cancer will receive a high-quality package of care planned by a multidisciplinary team of specialists, rather than what the British Breast Group report, "Provision of breast services in the UK", described as
    "ad hoc therapy being carried out by an individual acting without interaction with other members of a team".
    More importantly, there is evidence that patients treated in such units have improved survival rates. A paper in The Lancet last spring showed that women treated by a consultant who sees more than 29 new cases of breast cancer each year have a 30 per cent. better survival rate than those treated by a consultant who sees fewer new patients.
    The specialist unit also represents a very efficient way of treating breast cancer. Mr. Hugh Bishop, of the British Association of Surgical Oncology breast surgeons group told us:
    "a specialist breast unit is actually more efficient. It does fewer benign breast operations, it does fewer unnecessary investigations … and processes people more efficiently and in a more kindly way."
    That is the Government's vision for the future of breast cancer services in the United Kingdom, and it is a vision shared not only by the Select Committee but by organisations such as the British Breast Group, the British Association of Surgical Oncology breast surgeons group and the Cancer Relief Macmillan Fund.
    While the Committee welcomed the Government's new initiative, we believe that it could be improved further. We believe that there must be some mechanism for
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    ensuring that a hospital which is designated as a cancer unit or a cancer centre is providing the necessary services to the required standard. There is a real danger that every hospital with a consultant surgeon will simply hang out a sign saying "Specialist Breast Unit", and will designate itself as such, without having suitably trained specialist staff or the necessary critical mass of patients that is so vital to the good running of such a unit.
    The British Breast Group recommends that a specialist breast unit should see a minimum of between 75 and 100 new cases of breast cancer each year. That serves to ensure both that the general level of expertise among the team is sustained and that the unit remains cost-effective. By issuing a set of national mandatory standards for specialist breast units, the Department could ensure that all women with breast cancer receive the highest standards of care.
    During our inquiries, a definition of a specialist breast unit was produced by an ad hoc group consisting of representatives of various organisations involved in the management of breast disease, including several of the royal colleges. The Committee published the definition as an appendix to its minutes of evidence, and it can be found on page 191 of that volume. The same ad hoc group met again recently, and it has further revised the definition.
    I have praised the mechanism which the NHS breast screening programme has in place to ensure that all screening and assessment units provide a high-quality level of service through its quality assurance programme. It is a Rolls-Royce among breast cancer services. Unfortunately, many women whose breast cancer is not detected by the screening programme receive a second-hand Trabant service. They might be referred to a general surgeon at a local hospital who has no special training in the management of breast cancer, does not work closely with a team of oncologists, radiologists and cytologists, sees only a few cases of breast cancer each year, and is not subject to any external mechanism of quality control.
    In our report, we concluded that the QAP is one of the great strengths of the programme, as it operates at a level above individual purchasers and providers. We recommend that the remit of the national co-ordinator of the NHS breast screening programme and the regional quality assurance teams should be extended to cover the provision of services for women with symptomatic as well as screen-detected breast cancer.
    Such an extension of the quality assurance programme would enable the Department of Health to ensure that all hospitals which were operating specialist breast units met the minimum mandatory standards. My noble Friend Lady Cumberlege and the chief medical officer told the Committee that they were worried that a mandatory service specification might stifle useful innovations at a local level. I fully appreciate their concern, but the mandatory requirements which the Committee proposed are the minimum requirements. There is no reason why they should prevent units from providing a higher level of service than is specified.
    Perhaps I might draw an analogy with the patients charter. The charter lays down the minimum level of service that patients have the right to expect, but does nothing to prevent providing units from exceeding those standards. I am pleased that the Department of Health is

    1117
    working to develop service guidance for the common cancers, but I shall be grateful again if the Minister will assure the House that this will be sufficient to stop hospitals simply hanging out a sign.
    Breast cancer is almost unique, in that a quality assurance system operating at national and regional level is already in place within the screening programme. The Select Committee believes that an extension of the functions of the quality assurance programme and the office of the national co-ordinator to include services for women with symptomatic breast disease could lead the way for other site-specific specialties. It is perhaps surprising that that proposal was supported by many of the doctors who gave evidence to us. They want their work to be subject to rigorous quality control.
    Dr. Mike Richards of the British Breast Group told us that he would favour a national co-ordinator for all breast cancer services. Mr. Hugh Bishop of the British Association of Surgical Oncology told us that such a development was "absolutely essential". It is a pity that the Department is proving reluctant to build on the success of the screening programme in that way, but I await the Minister's response on the matter.
    During our inquiry, the Committee learned that at least one regional health authority—North Thames—is extending the role of its regional quality assurance manager to encompass the provision of treatment for breast cancer patients. It told us:
    "Women should be offered the same standard of care from the breast service in both screening and symptomatic investigation and treatment."
    The Committee considered ways in which clinical research in breast cancer might be improved. Although our inquiry related primarily to breast cancer services, our recommendations on clinical research will inevitably have benefits for many researchers working in other fields. We heard from researchers and from the Department of Health that one of the obstacles to conducting good clinical research was disputes over who was to provide indemnity for the clinicians and trusts involved in that research. The present system of providing indemnity for clinicians and trusts engaged in research is ambiguous.
    The Department of Health told us that NHS indemnity covered all NHS-provided health care professionals for negligent harm resulting from research undertaken as part of their NHS contract, and that the employing NHS body—for example a hospital trust—is expected to meet the entire cost of defending, and if necessary settling, a claim where negligence is alleged.
    Ultimately, it is for the employing body to decide whether to allow research to proceed or not, and a trust may decide not to allow its employees to participate in a trial if it does not wish to provide indemnity for them. Mr. Richard Gray of the clinical trials service unit at the university of Oxford told us that many trusts refused to allow their doctors to take part in trials unless they received indemnity cover from the study sponsors.
    In some cases, that has led to the absurd situation in which doctors have been permitted to use conventional treatments and new treatments of unproven effectiveness in an ad hoc manner, but have not been allowed randomly to assign patients to control and study groups in a way that would allow them to gain useful information about
    1118
    the effectiveness of the unproven treatment. That clearly militates against the Department's efforts to encourage the practice of evidence-based medicine, of which I am sure the whole House would approve.
    Good clinical research is of benefit to the whole NHS, and the Select Committee did not think it fair that the indemnity cost of that research should be provided only by those NHS bodies which participated in it. We therefore recommended that indemnity for NHS bodies and their employees participating in research which is approved by the relevant research bodies—in the case of breast cancer research, the United Kingdom Co-ordinating Committee on Cancer Research—should be provided centrally by the Department of Health. The Committee was pleased to learn from the Department that it will be considering that option in its current review of research indemnity. I hope that the Minister will be able to report the latest progress of the review to the House today.
    The Committee also recommended that the Department consider ways to streamline the system of ethics committees. Ethical review is an essential part of clinical research, but representatives of the UKCCCR told us that the present unwieldy structure of that committee system puts people off entering patients into trials. For a large multi-centre trial, the approval of as many as 40 local research ethics committees might have to be obtained.
    There are a few good reasons why a research proposal might be allowed to go ahead in one area and not in another. The provision of information leaflets in ethnic minority languages for patients is liable to be an essential part of a trial conducted in some parts of the country, but not others. Likewise, some hospitals may have the appropriate facilities to participate in a trial and others may not.
    The fundamental ethical considerations surrounding a research proposal, however, will not vary from one region to another. Breast cancer research is changing—moving towards the examination of smaller and smaller sub-groups of patients of different tumour types. It is therefore becoming necessary to involve more and more research centres in clinical trials.
    I know that the Minister shares the Committee's concern about the unwieldy system of local ethics committees, and that the chief medical officer is considering ways of streamlining the system. Perhaps the Minister might be able to give the House a little more detail about that review this afternoon.
    Finally, I should like to say a few words about the United Kingdom Co-ordinating Committee on Cancer Research and, in particular, its breast cancer trials and cancer screening sub-committee.
    The UKCCCR consists of the Cancer Research Campaign, the Imperial Cancer Research Fund, the Medical Research Council and several other cancer research charities. It was originally chaired by Professor Sir Patrick Forrest, who was instrumental in establishing the NHS breast screening programme. The Department of Health and the Scottish Office Home and Health Department have observer status on the committee. The UKCCCR provides a forum for the exchange of information on the policies and plans of member bodies, recommends proposals for the co-ordination of policies, and offers advice to the member bodies on any matters that might come before it.

    1119
    Although the breast cancer trials co-ordinating sub-committee of the UKCCCR runs some trials of its own—such as those that are being conducted to examine the treatment of ductal carcinoma in situ and the use of tamoxifen—and endorses and co-ordinates large, multi-centre trials, it does not distribute the funds for such trials. After researchers have obtained approval from the UKCCCR, they must scrape around trying to find out where they can fund the research, going to committee after committee, at the mercy of the weakest of those committees, and all before they have to go through the system of local research ethics committees, which I have just described.
    The UKCCCR breast cancer trials co-ordinating sub-committee can be seen as the parent body for breast cancer research, representing most of the main sources of research funding. The Select Committee believes that it would be a step forward if the UKCCCR were to have its own budget for funding trials, so that it could act as a one-stop shop for researchers wishing to undertake a trial.
    We recommend that the Department of Health and the Medical Research Council identify their budgets for breast cancer research, and distribute the money through the UKCCCR in the expectation that that will provide an incentive for other research funding bodies to do likewise.
    I understand that neither the Department nor the MRC has a specific budget for breast cancer research, but I cannot see why it would not be possible for them to identify the amount which they currently spend on breast cancer research, and devolve that amount to UKCCCR. The whole Committee agrees that that would be a welcome development, which would make it easier for researchers to gather vital information about the effectiveness of new treatments at the earliest possible opportunity.
    I know that colleagues from the Select Committee wish to contribute to the debate, so I shall draw my remarks to a close. In my introduction, I have attempted to focus on the main conclusions of the Committee's report, but I look forward to hearing the views of other hon. Members, and, in due course, those of my hon. Friend the Minister.
    4.35 pm
    Mr. Kevin Hughes: I welcome the opportunity to take part in this important debate. Breast cancer services for women in the national health service are an important issue. As the Health Select Committee acknowledged in its report on breast cancer services, we have learnt that although England does not have a particularly high rate of breast cancer occurrence, it has almost the highest recorded breast cancer mortality rate in the world.
    Currently, almost 30,000 women are diagnosed with the disease annually and around 14,000 die of it. It is responsible for about 5 per cent. of all women's deaths throughout the country. Understandably, breast cancer is an emotive issue. It is also a very real issue for the tens of thousands of women who have the disease and the thousands who die from it.
    We must set this debate against the background from which it emerges—the increasing inequalities in public health. Since the Black report was published, socio-economic differences in health have increased. The difference in mortality rates between the deprived and the
    1120
    affluent has increased substantially. The recent widening of health inequalities mirrors the gross upward redistribution of wealth since 1979. It is vital that patients should have access to the same standards of health care throughout the country, irrespective of where they live or to what socio-economic class they belong. Inequalities in health should be targeted and eradicated.
    In the Government's "The Health of the Nation", mortality rates for women suffering from breast cancer are targeted as a leading priority to be reduced in the long term. The Government have recognised the importance and significance of mortality rates for women suffering from breast cancer. They know that the figures are illustrative of the condition of the public health services.
    In "The Health of the Nation", targets were set for a reduction in mortality of those screened for breast cancer. In progress reports on "The Health of the Nation", the Government are, I believe, complacent in stating:
    "progress to date has been in the right direction".
    Yet statistics from the House of Commons Library show that 60 per cent. of district health authorities are unlikely to meet those targets. Of the 112 district health authorities in England, 54 will fail to meet the target of a 25 per cent. reduction in mortality rates by the year 2000.
    The Government's comments are therefore misleading and superficial. The Government's document on variation in health, in commenting on variations in breast cancer, stated:
    "with respect to mortality there is relatively little variation around the England and Wales average".
    "The Health of the Nation" dedicates only one page to regional variations but socio-economic variations show that, although the incidence of breast cancer is higher among the wealthier classes, the lower classes are more likely to die from the disease.
    Leading health professionals are concerned that breast cancer services continue to vary considerably throughout the United Kingdom.
    Mr. David Congdon: Will the hon. Gentleman give way?
    Mr. Hughes: No.
    Department of Health public health common data showing regional and local mortality rates from breast cancer illustrate the huge variations between local health authorities and, on a wider and more significant level, large variations between regional health authorities.
    I am particularly concerned about those alarming figures because they highlight the high rate of breast cancer mortality in and around my constituency. Although the registration rate for breast cancer in Doncaster is some 7 per cent. lower than the national rate, we have a disturbingly high mortality rate from breast cancer. For most of the past 11 years, the rate has been significantly higher than the national average. In 1993, it was 13 per cent. higher than the national average yet in neighbouring areas mortality rates from the disease have been consistently below the national average. The figures for North and West Yorkshire, for example, are significantly lower.
    The House of Commons Library has analysed the progress made towards "The Health of the Nation" targets and assessed Doncaster as having made negative progress. Indeed, it is moving away from the targets set in 1990.

    1121
    A snapshot assessment of breast cancer mortality for women aged between 50 and 69 in 1993 puts the rate in Doncaster at 118 per 100,000 women, one of the highest rates in the country and the fourth worst for that year. The figures for 1994 are 82 per 100,000 women. Despite the reduction, Doncaster will still fail to meet the national standards set by the Government in their report. The Government are failing to meet their standards and failing badly the women of Doncaster.
    Figures for the Trent authority show that, once again, there has been a higher than average mortality rate for the past 10 years. Let me compare those statistics with those of the neighbouring health authority. Northern and Yorkshire's statistics show a consistently below average mortality rate for each year in the past 10. The Government must recognise that those variations exist and begin to assess the local rates. They must set local targets rather than rely on a national target that could be set by a collection of varying mortality rates around the country, and seek to achieve those local targets. Perhaps they are too frightened to do so because local targets would emphasise what the Labour party has illustrated—that regional variations mean that many district health authorities would fail the Government's test.
    As in any area of the health service, it is vital that women throughout the country receive the same standard of treatment wherever they happen to live. It is important that the Government make progress in meeting the targets that they have set. Why do not they publish local targets? Why has it been left to the Labour party to put those variations in the public domain? Are the Government too ashamed of the progress that has been made? We talk of statistics, but those represent people—in this case, women who suffer and die.
    Access to health care and a chance of survival must not depend on where one happens to live. They must be accessible to people in all areas. The Government must monitor more effectively the progress towards their targets. They must deal with those regional variations in health care. We have shown that they have not dealt with those issues. They must now begin to do so.
    4.44 pm
    Mr. David Congdon: I was appalled by the speech of the hon. Member for Doncaster, North (Mr. Hughes), who refused to accept an intervention when he was using statistics selectively. The Select Committee asked to see the regional differences in rates of breast cancer and those are published on page 239 of the Select Committee report.
    In no area of health care can it be argued that an average figure will be the same for each area of the country. There is no reason why it should be. The population profile of each area differs and it is naive and ludicrous for the hon. Gentleman to think that all areas should conform to the norm. Each health authority should aim to bring about an improvement in the figures for its area, which is why it is important to publish figures and aim at a target. To pretend that differences show that the system is failing is wrong. As the hon. Gentleman said, although he did not pursue the point, breast cancer appears internationally to be a disease of affluence.
    Mr. John Austin-Walker: The hon. Gentleman referred to page 239 of the Select Committee
    1122
    report, which gives the regional figures. Those figures are for breast cancer incidence whereas my hon. Friend the Member for Doncaster, North (Mr. Hughes) said that, although the incidence may be higher in affluent areas, the mortality rate was higher in less affluent areas. Those figures do not reflect mortality rates.
    Mr. Congdon: I accept that the table contains incidence figures. If the hon. Gentleman wishes to provide me, after this debate, with figures for mortality in relation to incidence, I should be pleased to study them. I cannot look at figures that the hon. Member for Doncaster, North holds up on the opposite side of the Chamber. I am not complacent about the incidence of or death rate from breast cancer, but it is shameful to try to make party political capital out of this issue.
    Mr. Henry McLeish: Disgraceful.
    Mr. Congdon: The disgrace is that Opposition Members are trying to make party political capital out of such an important issue.
    Ms Jean Corston: Will the hon. Gentleman give way?
    Mr. Congdon: No, I shall not give way at this point. I want to make some progress.
    The Select Committee carried out a useful inquiry into an issue that concerns many people, particularly women. Cancer in any shape or form is a disturbing disease that causes great anxiety and concern, and breast cancer probably causes more concern than most. It tends to strike younger women. Perhaps the most serious cause of concern is that it is often not identified until it is too late.
    I said earlier that the incidence of breast cancer tends to be higher in wealthier countries. I would welcome more research into why that is so. The incidence of breast cancer is rising in the United Kingdom but, so far as I am aware from the Select Committee inquiry, no one could give substantive evidence as to why that is so. Perhaps we are simply getting better at diagnosing the disease, so we must take care when arguing about incidence.
    The Select Committee was also advised that suddenly in 1989 the death rate started to decline, but nobody seems to know why. It cannot be because of screening because the programme had not started at that time. The importance of the Forrest report's recommendation to implement a screening programme has been acknowledged by all. That programme appears to have been successful, although more evaluation of the figures is necessary.
    The United Kingdom was the first European Community country to introduce a national breast screening programme. It is acknowledged to have a good system of quality assurance, which ensures that it is implemented effectively. It was decided that all women between the ages of 50 and 64 should be screened regularly. The Committee received a great deal of evidence to suggest why that should be so. We were advised that screening has not been introduced for younger women because it has no particular impact on mortality; equally important, and more significant, there are difficulties in reading mammograms of pre-menopausal women. Members of the Committee were broadly prepared to accept that advice from the medical profession.

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    There is far more controversy, understandably, about the decision not to screen regularly women above the age of 64. The Committee was advised that there would be a lower take-up by older women, and that there is a greater risk of older women dying from other diseases. The Committee was, frankly, unconvinced by those arguments. I was therefore pleased to support the Committee's recommendation that the screening programme should be extended to women aged 69.
    It is particularly interesting to look at the relevant figures on breast cancer, which show that it is more common among older women. In 1989, 8,752 women between the ages of 50 and 64 died from breast cancer, and, 11,179 over the age of 64 died. Those figures reveal that more than 60 per cent. of breast cancer deaths occur in women over the age of 64. Surely that is a good reason for extending screening to include women up to the age of 69.
    Rev. Martin Smyth: The Government argued that they had decided not to go ahead with breast screening for older women because they felt that it was not cost-effective. Does the hon. Gentleman agree that the evidence that we received suggests otherwise? The Government's response was a disappointment to many members of the Select Committee and to people throughout the country.
    Mr. Congdon: I am grateful to my hon. Friend for that intervention. If he had asked me that question half an hour ago I would have agreed with him entirely, but I have just happened to read in Hansard of 4 December that the Government have announced that, from 18 October, pilot schemes have been operating in the Northern and Yorkshire and South Thames regional health authorities to evaluate the effectiveness of extending breast screening to women up to the age of 69. I am a bit behind the times, and was unaware of that when I read the Government's response at the weekend. I welcome that announcement, and I am particularly pleased that I read about it just 15 minutes ago. I am sure that my hon. Friend the Member for Belfast, South (Rev. Martin Smyth) will be pleased about that announcement as well.
    Screening is effective if it succeeds in identifying those women with breast cancer early enough so that they can be treated and prevented from dying. The hon. Member for Doncaster, North referred to the relevant figures, which reveal that in 1992, just under 14,000 women died from breast cancer, which is just under 5 per cent. of all female deaths. That is a staggering number of deaths from one particular disease—something that hon. Members on both sides of the House take seriously. Perhaps it is even more significant to note that breast cancer accounts for more deaths than any other form of cancer, including lung cancer. I find that pretty incredible.
    A particular problem struck me as I was interviewing witnesses before the Select Committee about screening. The one problem with breast screening is that, apart from identifying those women with breast cancer, it generates a false positive. If a woman is recalled because there is something about which the doctors are concerned on her mammogram, she may have to wait a couple of weeks for an appointment. That woman is obviously subject to unnecessary worry and anxiety. The worst thing about any form of diagnosis is when the doctor says, "We think you have a problem, but we're not sure; we'll need to see you again in two to three weeks' time." That causes a great deal of anxiety.
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    The key point is revealed by the following figures. Since 1987, 5 million women—a staggering figure—have been screened. Of those, 270,000 have been recalled for further assessment. That does not mean that those 270,000 women had cancer, because just 20,000 of them were identified as suffering from it. I questioned witnesses in the Select Committee about those figures and drew to their attention the fact that that means that for every woman identified by screening as having breast cancer, a further 12 went through an awful lot of anxiety. The thing that surprised me was that a strange atmosphere then descended on the Committee, as though the witnesses had never heard of those figures before. I am concerned about that.
    I understand the medical profession's proper desire to ensure that the screening programme works properly and succeeds in identifying those women suffering from cancer, thus preventing them from dying. That is a fantastic achievement, but I do not believe that the profession has paid enough attention to the flip side of the coin—the anxiety caused because the screening programme fails to reduce the number of false positives. That is an important issue.
    Mr. Harry Greenway: I apologise, Madam Deputy Speaker, for missing the beginning of this debate. I have some constituents in the House, and they have allowed me to pop in for 10 minutes, so I am grateful to my hon. Friend for giving way. Administrators in Ealing are strongly inclined to move the breast cancer service from Ealing hospital to other hospitals at some distance from my constituency. Women in my constituency, however, feel confident about the services that they receive at their local hospital. Does my hon. Friend agree that it is important to avoid imposing difficult, if not impossible journeys on women who go for breast screening? Does he agree that that service should be offered at the hospital in which they are confident, such as Ealing hospital? I am grateful to my hon. Friend for allowing me to say that.
    Mr. Congdon: My hon. Friend raises an important point, which reveals the dilemma created when planning any services relating to breast cancer and other diseases.
    All recommendations suggest that three-tier models represent the best means of providing a screening service. One needs to ensure that a woman receives good primary care when she goes to her general practitioner, and that she is properly referred on for treatment—assuming that she has not been identified through the screening programme.
    As my hon. Friend the Member for Broxbourne (Mrs. Roe), the Chairman of our Select Committee, has already said, all the research shows that a woman stands a better chance of survival if she goes to a unit that deals with more than a few cases of breast cancer a year. It has been recommended that breast cancer units should be established to cater for populations of about 200,000. I cannot comment specifically on Ealing, but from time to time there will inevitably be conflicts between trying to ensure that units of a sufficient size are provided so that an appropriate number of patients can be treated and the unit can develop the necessary skills, and ensuring that those units are not too far away from their patients.
    The number of false positive results can be reduced in a number of ways. For instance, I welcome the decision to ensure that women receive their second mammogram at the

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    same time as the first one, because that improves reliability. One will never be able to prevent all false positives, so it is even more important to ensure that all the services that women may require, including further assessment, are carried out at the same time. That means that they do not have to return for further visits, which is important.
    Having identified those women suffering from breast cancer, it is crucial to ensure that they receive appropriate treatment to try to reduce the number of deaths—a point made by the hon. Member for Doncaster, North. The Select Committee report contained a number of recommendations; the Cancer Relief Macmillan Fund has also made a number of important recommendations. It suggested that there should be minimum standards of care based on a list of principles.
    A significant factor in the Select Committee's investigation was that a number of separate studies had all come to the same conclusion about cancer treatments, including breast cancer. I understand that it is important that people suffering from breast cancer should be treated by not a general surgeon, but a specialist. It is important that patients have a specialist breast care nurse to provide the necessary counselling during a traumatic period.
    I am pleased to support the important report on breast cancer, which was unanimously approved. We all recognise that there is room for improvement and I hope that improvements will be made in all parts of the country. I doubt whether that will yield a uniform death rate, but so long as we make progress we shall have been successful.
    5 pm
    Mr. Henry McLeish: I am pleased to participate from the Front Bench in the debate initiated by the hon. Member for Broxbourne (Mrs. Roe). I agreed with much of what she said and with the polite way in which she suggested that the Government might want to be more ambitious about the future of the service than they are currently willing to contemplate or resource.
    I say to the hon. Member for Croydon, North-East (Mr. Congdon) that passions often run high in the House. Today's debate is on a serious subject that requires discussion, dialogue and informed criticism. My hon. Friend the Member for Doncaster, North (Mr. Hughes) gave some key statistics on access. One of the most important features of the subject is access—patients' access, access to screening and access to appropriate treatment.
    It is worth placing on record some of the cold and clinical statistics. Breast cancer is the leading cause of female cancer death in the United Kingdom. It is the commonest single cause of death in women aged 35 to 54. There are about 24,000 new cases of breast cancer every year and about 15,000 women die from the disease. There are nearly 500 new cases every week and nearly 300 deaths every week. Behind every individual statistic there are members of families and extended families. The problem is huge and, in presenting the case from the Select Committee, the hon. Member for Broxbourne suggested its seriousness.
    It is also important to identify the fact that mortality rates have remained virtually unchanged for the past 50 years. It is encouraging to note—as the hon. Members
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    for Broxbourne and for Croydon, North-East did—that in the latter part of the 1980s the mortality rate figures started to come down. That is to be welcomed and one of the outstanding challenges in relation to breast cancer is to maintain that reduction.
    Statistics can be translated into humans. I estimate that 15,000 deaths will mean that about 100,000 people—a large number—could be involved in the bereavement process every year. The emotional and physical damage done can be devastating. All those who are given a positive diagnosis face the trauma of uncertainty and they do not know whether treatment might lead to death or a much longer remission period. A hallmark of the national health service programme is the sensitivity surrounding the treatment.
    One of the key aims is to try to reduce mortality rates, but it was interesting to read in the section on variations in health in "The Health of the Nation", produced by the Government, an apt phrase that sums up the second major objective: adding years to life and life to years. Clearly, mortality rates provide a fixed benchmark in the debate; they are easily recorded. Not always so obvious are those people who have been screened, receive the appropriate treatment and may go into long-term or short-term remission, when the years-to-life and life-to-years issue is an important factor. I hope that the Minister appreciates—I am sure that he does—that the subject involves not merely death, but living. That key objective should underline our agenda.
    We should place on record the House's appreciation of the national health service breast screening programme; the hon. Member for Broxbourne did so and the Opposition agree with her comments. The programme does an excellent service and has a tremendous staff; it is a national programme that is extremely well led. When attacking breast cancer over the next decade it is important to keep the national dimension firmly before the House and the general debate.
    Although the service was introduced in 1987 and was fully operational in 1990, there still seems to be huge potential. There have been three or four years in which the service has made an impact on breast cancer. Bearing in mind many of the changes suggested by the Select Committee and some of the advances in technology, and given the necessary resources, the service is well placed to achieve much more in the new millennium, which is now only a few years away.
    My key concern involves access and availability; at the argument's core lies the availability of screening, the availability of diagnosis and prognosis and the availability of treatment. We can argue on the degree to which availability varies throughout the nation, but we can possibly agree that availability differs throughout England, Scotland and Wales. That is not necessarily a political point, but is a fact of life: variables will influence health that the health service cannot tackle. But some variations in the figures can be tackled by effective intervention from the health service.
    The availability of the service is one factor, but access to it is another. My hon. Friend the Member for Doncaster, North and others have suggested that social and class differences have an impact on access to screening and treatment. Some district health authorities may be more enthusiastic and energetic and may give breast cancer a higher priority. I do not say that as a

    1127
    criticism of the national standards but, clearly, the success or otherwise of the service depends on the approach on the ground. Therefore, the key aspect of my contribution concerns the availability and quality of services, and how access to them varies throughout the country.
    The national programme for breast screening shows that the figures for access to screening vary. East Anglia has the highest acceptance rate for screening: 78 per cent. of those invited are screened. In North-East Thames, the adjacent health authority, the figure falls to 62 per cent. A visible indication of screening and access to it—not a value judgment on the reasons for it—is the cold statistic from the national screening programme that suggests that acceptance of screening must be consistently above the average that has been set. The English average is 72 per cent.—the North-East Thames area is 10 per cent. lower and the East Anglia figure is almost 16 per cent. higher. As my hon. Friend the Member for Doncaster, North said, the significant variations were not recognised in "The Health of the Nation" published earlier this year—we should bear that in mind.
    My hon. Friend also mentioned some material, which we published last week, that we had obtained from the House of Commons research division. It produced a snapshot of mortality rates for 1993, which found that England had an average of 86, but that 55 authorities fell on or above that average. In South Essex there were 125 deaths and in South-West Surrey there were 45. I stress that it was a snapshot and therefore the figures must be heavily qualified, but I believe that they show the tremendous variations in availability of and access to facilities throughout the country.
    Mr. Congdon: I have followed the hon. Gentleman's argument quite carefully. Has his research identified any correlation between the take-up of screening and mortality rates in a particular area? He cited the figure for South-West Surrey, but North-West Surrey has a very high mortality figure of 122. Has his research identified any such correlation?
    Mr. McLeish: No, but that is a fair point. We conducted a distribution analysis, which was a fairly cold and clinical look at statistics sourced from the Department of Health and processed through the House of Commons Library. In a sense, it was a factual account of a snapshot for 1993.
    I now turn to the Government's target as stated in "The Health of the Nation" White Paper, which relates to those who are eligible for screening. Our research examined mortality rates in each district health authority, measured any changes between 1990 and 1993 and projected those changes towards 2000. It is quite significant that, according to the current rate of change, more than 60 per cent. of district health authorities would not meet the target. It is not a case of whether our figure is right or wrong; the magnitude of our findings—60 per cent. of health authorities—is important. We must debate whether the Government are on target to meet their objectives at regional and local level. I hope that the Minister will respond to that specific point later in the debate.
    The Government point out in "The Health of the Nation" that there do not appear to be significant variations in the English and Welsh averages. Our research contradicts that finding, although the Government have access to different
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    technology and to technicians and scientists who provide other information. We believe that "The Health of the Nation" document is flawed to the extent that it concentrates mainly on national targets and whether we are moving towards them. The Government should look at district health authority level, and perhaps at local level, to see whether real progress is being made. Under its remit, the Select Committee was to consider ways in which the quality and availability of breast cancer services in the United Kingdom could be improved, which suggests that there may not be equal service provision throughout the length and breadth of the nation.
    On regional or local health service inequality, Conservative Members stress, quite correctly, that many factors—quality of life, housing and genetics—influence health. Health service teams, whether Conservative or Labour, cannot control such factors. However, there must be general areas within the health service where we can intervene more effectively—especially in relation to breast cancer. Deaths can be prevented and programmes and service distribution can be improved.
    There are inequalities in health service provision throughout the nation and there are factors that we cannot change easily. However, we can make some obvious changes and it is the responsibility of Government to look more closely at what is occurring in health and to intervene more positively. That is a key issue to consider when discussing variations in health provision and whether the health service could be more interventionist and lever change much more effectively.
    The Select Committee produced an excellent report; it heard a wide range of evidence and pinpointed the changes that should be made. The hon. Member for Broxbourne has already outlined some of those changes and I expect that she is hoping that the Government will respond to them positively. The Committee recommended that the upper age limit be extended to 69 for the call and recall screening programmes. Evidence to the Select Committee suggested that that would prove very worth while. The national screening programme has outlined the cash implications of the recommendation and we are not talking about substantial sums of money. However, we are talking about possibly fewer women dying and more women receiving early diagnosis and enjoying an improved quality of life.
    That is a very powerful reason why we should look closely at how a small amount of money may be used to improve the length and quality of life and spare families the agony of premature death. As the hon. Lady said, the Government have responded positively and they are taking forward several pilot projects.
    The Select Committee also raised the key issue of intervals between screening. Some people were shocked by the detailed figures that showed the number of cancers that grew in three years. The national health screening programme was slightly dismayed by those figures, but it is understandable in a new programme. The three-year interval was based on experience and scientific evidence, and it must now be examined more closely.
    The Government claim that they need hard evidence to support any change and the Select Committee has said that there is no point spending money until that evidence is forthcoming. I hope that the Government will demonstrate some urgency and enthusiasm in pursuing that evidence, as it comes down to saving lives and improving the quality of life of many women.

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    Another key issue is the question of future treatment within the three-tier structure. Unlike some of the other suggestions that are more about effective clinical management of the service, this area will require resources. The hon. Lady put it in a nutshell when she said that we do not want to develop national standards that encourage every hospital in the country to establish breast cancer units that, despite appearances, would be unable to do the job because of the quality of staff. The Minister should consider allocating resources in that area: the idea of a properly resourced primary health care service, breast cancer units and specialist centres makes sense to anyone who is seriously interested in tackling the problem.
    Reference has been made to the double view or double shot. The information suggests that if two views of each breast were taken at every screening—not just the first, which the Government are quite happy to implement—a potential condition could be assessed much more effectively. I sincerely hope that the Government will consider that issue, along with research and development, training and quality assurance, which I shall mention briefly in a moment.
    The Select Committee also made an important recommendation with regard to the Cancer Relief Macmillan Fund, which is an excellent organisation that performs a great deal of work throughout the country. Labour Members may be a little suspicious and sceptical of the patients charter, but it does recommend standards of care. If a diagnosis is complete and if life can be extended, quality of life and quality of care are inextricably linked. The Department of Health dismissed the issue by claiming that some care criteria appear in the patients charter and what is not there is not necessary anyway. I hope that the Minister will not adopt a similar attitude, as it does not address the seriousness with which the Cancer Relief Macmillan Fund has pursued the charter. I urge the Government to rethink the situation.
    I am worried that I have been a little over-generous in my support of the Select Committee report. I may be slightly more critical of it than the hon. Lady, but I am sure that she will understand why I must do that. There have been a plethora of reports on breast cancer in the past few years, and the Chairman of the Select Committee has now outlined in detail the Committee's concerns. Obviously the nation is concerned. There is clearly a problem, at least a statistical problem. We have seen the Calman report, research and development has been given priority in other reports and the Secretary of State has spoken of a policy framework for the commissioning of cancer services. We have had a number of debates and discussed a range of issues. The crucial question for those with cancer, however, is what the agenda for action will be.
    Given the Government's response, the current slight degree of scepticism is understandable. When the Secretary of State for Health outlined the policy framework for the commissioning of cancer services last April, it was accompanied by an NHS executive memo. Although the Government were vague about resources and timetables in their policy statement, the NHS executive was not. Paragraph 6 of its document is worth reading. A Select Committee has produced an excellent
    1130
    report and the House is united in its wish to tackle an obvious problem, but the NHS executive states, in a rather cruel and clinical way:
    "The changes in the organisation and provision of cancer services recommended in the report will take several years to implement."
    There is nothing too specific about the different recommendations. The NHS executive simply makes the blanket statement that implementation will take some years. It continues:
    "Those planning cancer services on the basis of the recommendations should do so within available resources, taking account of the assessed needs of the local population and having regard to other health and health service priorities. A great deal can, of course, be achieved through better organisation and better use of existing resources."
    We accept the latter part of that. Better delivery of services is possible in any organisation if changes are made to its resources and other arrangements. Like the hon. Member for Broxbourne, however, we feel that there is no point in having a Rolls-Royce that is being serviced in the same way as—I shall not name the car of which I am thinking in case I get into trouble with my constituents, but I am thinking of a car of lower quality than a Rolls-Royce. We can see all the problems: they have been analysed. I must ask the Minister, however, whether the Government are really committed to improving the service so that it meets the standards demanded by us and the Select Committee.
    Although it is not just a question of resources, they will be needed to implement many of the recommendations that have been made—the recommendation for a three-tier structure, for instance, and the recommendations relating to quality. I hope that the Minister will mention that.
    Let me raise two or three practical points. The wider brief to consider the future of the service in the next millennium involves immediate and fundamental issues relating to the national screening programme. First, there is the quality assurance programme. I could not agree more with the hon. Member for Broxbourne: that programme is vital. It is this part of the service that makes it different from any other service in Europe. The quality is there, and the service is being delivered; but fundamental concerns surround the continuation of that quality. The fragmentation of the NHS has brought more confusion to the system. The hon. Lady referred to purchasing and providing. We must be cautious and sensitive in the new, artificial market, because the quality of the screening service could be affected.
    I should also like to know who will be responsible for quality assurance following the changes that will be introduced in April 1996. The proposal for a regional organisation to oversee the selection of the lead purchaser looks fine on paper, but it prompts many questions about the consistency and cohesion of the whole quality assurance programme. Those involved in the national screening programme are anxious on that score. We must ensure that we do not end up with an arrangement whereby district health authorities and others are purchasing in one environment while there is confusion and a reduction in quality in the quality assurance process.
    Then there is the question of ring fencing. Funding for breast cancer at district health authority level is now part of general funding, which means that, if a district health authority gives the service a lower priority than other services, the whole process could suffer. I do not believe

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    that "The Health of the Nation" targets and a national strategy can he left to local organisations; they should not be allowed to dictate priorities.
    I agree with the hon. Lady that we should be concerned with mandatory standards. We shall be setting the minimum standards, but they are important. Enterprise and innovation are fine, but let us not use them as a smokescreen to disguise the fact that a lack of central direction and standards of the highest order could result in problems within health authorities. I urge the Minister to consider ring fencing: that, I believe, is the only way in which we can ensure that priorities and minimum standards are the same throughout the service, and that we implement some of the Select Committee's recommendations.
    Neither the country nor the House is giving enough thought to the demography of aging. If we decide to extend the screening programme to those aged up to 69—and, indeed, if we continue to provide the same service for those aged between 50 and 64—we shall find that an increasing number of people fall into those groups. There is currently no hint of extra resources to cater for the extra demand. Every NHS executive circular, and every utterance from the Government, suggests that most of the recommendations are accepted, but there is no flexibility in relation to cash. We are told that it must be found from available resources.
    That might be possible in some areas, but it is clear that, as we enter the new millennium, demography will play a much greater role throughout the health service. The Government must recognise that if screening is extended to those aged up to 69, if the intervals between screenings are reduced and if double views at every shot are to be introduced, there are bound to be resource implications.
    Let me end by reiterating my concerns. I do not want the Government to reject the idea of a national strategy to tackle breast cancer. The reforms in every other part of the NHS have devolved responsibility down the line, but this is a national issue that requires national standards and firm guidance from the centre. I should like to think that the Government will not merely pay lip service to the recommendations of expert bodies and Committees of the House.
    I do not think that the Minister should put local breast cancer services at risk by failing to ring-fence money allocated to district health authorities. He should be aware that the fragmentation of the NHS could undermine nationally based programmes. I have mentioned the consequences of failing to acknowledge the resource implications of new technology, and the recommendations made in that context. It is also crucial for the Government not to undermine morale in what is an excellent service. Many members of staff are anxious about their futures, and they are right to be anxious.
    So far, the Government have refused to appreciate the urgency of building on this excellent programme. Unlike the NHS executive, I do not think that we have years in which to ponder decisions. We need a national strategy. We must tackle variations; we must ensure that quality is maintained; and a seamless process must take place between screening and treatment. We can build on the progress that has been made, but the Government must approach the matter with more urgency. That is what the Opposition want, and I hope that the Minister will give us some indication that he wants to take speedier action than is currently being suggested.
    5.28 pm
    Mr. John Whittingdale: Breast cancer should not be a party political issue. In that spirit, I welcome the contribution of the hon. Member for Fife, Central (Mr. McLeish). I am particularly grateful to him for his praise of the Select Committee's report and I agree with at least part of what he had to say.
    Before the Committee's inquiry, I must admit that I had little knowledge of breast cancer. As a man, it is still hard for me fully to appreciate the true horror of the disease. We were fortunate that a quarter of the Committee members were ladies, who perhaps have a better understanding of the trauma that a diagnosis of breast cancer can cause. Although I do not have a full appreciation of that trauma, the inquiry was one of the most harrowing in which I have been involved. All the Committee members found the evidence of Dr. Gwyneth Vorhaus particularly moving. She was undergoing intensive chemotherapy for the disease at the time that she spoke to us. We also heard evidence from the representatives of RAGE—Radiotherapy Action Group Exposure—which is a group of women who have had radiotherapy and some terrible injuries following it.
    In examining the diagnosis and treatment of breast cancer, we looked first at its rate of incidence and the associated rate of mortality. The statistics on incidence are cause for alarm. In England and Wales, the incidence rate is 56.1 cases per 100,000 of population, which puts us approximately in the middle of the range for developed countries but certainly well below the United States, which has an incidence rate of 89.2 per 100,000 for white Americans, although the rate is only 65 cases per 100,000 for black Americans. However, the rate is increasing. In this country, it rose by more than 40 per cent. in the 10 years to 1992, although that is less than in some other countries.
    There is widespread variation in the incidence rate between different regions in the United Kingdom, as several hon. Members have already said. The 28 per cent. average increase which occurred between 1979 and 1989 masks increases that range from only 3.2 per cent. in the Trent region up to 47 per cent. in Wessex.
    There may be a number of reasons for the variation in incidence and for its increase. I accept that the quality of statistics certainly varies widely and that, in some countries, the figures that have been quoted may be highly suspect. Improvements in detection may also explain part of the reason for the rise in incidence. All our witnesses agreed, however, that very little is known about the reasons for international or regional variations in the incidence of breast cancer or why the incidence rate is rising. The variations are so great and the rise is so sharp that there can be little doubt that women in some countries are far more prone to breast cancer than those in other countries and that the number getting the disease is rising rapidly.
    The evidence is still more frightening when one comes to examine the mortality rates. As has already been said, on this measure the United Kingdom has almost the highest breast cancer mortality rate in the world. It is way above that of many countries whose incidence rate is higher than our own. That may be because our treatment of the disease is inferior to the treatment in other countries; it could also be because women in the UK are prone to suffer a far more aggressive form of the disease.

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    One of the first questions that I asked our witnesses was why the USA had a higher incidence rate of breast cancer than the UK but a lower mortality rate, and what were they were doing in the USA that we were not doing here? Professor Vessey, the chairman of the advisory committee on breast cancer screening, concluded his reply to me by saying:
    "there are plenty of suggestions but I do not think that anybody really has a very good answer".
    In our inquiry, it quickly became abundantly clear that we do not know the answers to these questions. What causes breast cancer? How can it be prevented? Why are there such enormous variations in its incidence between and within countries? Why is it that Japan, which is a developed country with a high standard of living, has one of the lowest rates of breast cancer in the world? Why is it that the incidence is rising rapidly, and why is it that more people die from it in the UK than almost anywhere else in the world?
    My first conclusion was that much more research needs to be done. For some reason, research into breast cancer is not accorded the priority that it deserves. One in 20 women is likely to die from breast cancer and, in 1993, there were more than 13,000 registered deaths of women from it in England and Wales. That compares with approximately 1,150 notified deaths from AIDS in the UK. Government expenditure on research into AIDS, however, through the Medical Research Council and the Department of Health, was £17 million. That amount is nearly five times the expenditure on research into breast cancer.
    When expenditure by charities such as the Imperial Cancer Research Fund and the Cancer Research Campaign is added into the total, the amount still comes to only £12.5 million, which is 70 per cent. of the figure spend on research into AIDS. We do not have a world breast cancer day, and we do not see celebrities organising concerts to raise money for research into breast cancer. I am not suggesting that we should not be spending money on researching AIDS, but I must question whether we have our priorities right. I think that there is more than a whiff of political correctness about those figures.
    Given the lack of knowledge about the disease, I understand why the NHS decided to concentrate on establishing a breast cancer screening programme to enable the early detection and treatment of the disease. We were given ample evidence that screening programmes result in fewer deaths, and we have every right to be proud of the fact that the United Kingdom is one of the first countries to set up a national screening programme. Since the programme was started in 1987, 5 million women have been screened and approximately 20,000 cancers have been detected as a result.
    As my hon. Friend the Member for Croydon, North-East (Mr. Congdon) pointed out, however, for every cancer that was detected, nearly 10 women who did not have cancer were recalled because they had false positive results. The anxiety and fear that were raised as a result of those false results can only be imagined. In some cases, women had to undergo unnecessary clinical investigations—even surgery—as a result.
    There is also a problem of false negative results when women have been told that they do not have breast cancer but who have gone on to develop the disease shortly
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    afterwards. That is something which might be addressed by the more widespread use of double-view exposures, as has been mentioned already.
    It may be that false positives and negatives are a price worth paying. We must address the question raised by Professor Michael Baum, our specialist adviser from the Royal Marsden hospital, as to whether the small benefit of reducing the risk of dying from breast cancer compensates for the undoubted harm resulting from false alarms and unnecessary interventions. He was right to ask whether the money spent on population screening would save more lives if the scarce resources were redirected to the more efficient care of symptomatic women and greater spending on research into improving the treatment of those already suffering from the disease.
    I am sorry that Professor Baum did not raise those issues at the time of our inquiry. They are, however, serious issues which deserve examination, and it was a great pity that the media chose simply to report that he had declared the breast test to be useless, which was certainly not the case. I believe that Professor Baum remains a supporter of the breast screening programme.
    Professor Baum was also entirely right about the need for more informed choices by patients. All too often clinicians assume that patients do not want to know the details of their condition or the options that are available to them. Alternatively, clinicians do not bother to inform their patients because they think that they will not understand. I suspect that all of us have come across terrible examples of the lack of sensitivity of doctors and consultants when advising patients about their condition. Perhaps the worst example that I have ever heard was the treatment of Dr. Vorhaus, who told us that the night before surgery a junior doctor had casually informed her:
    "We have decided to do a mastectomy instead of a lumpectomy."
    When she asked why, he said:
    "I really don't know what you are worrying about—you've got such small breasts it doesn't matter and anyway, someone with cancer should not be worrying about what happens to their breasts."
    That was how she was formally told that she had cancer.
    Dr. Vorhaus also told us that she met only two doctors who extended any degree of human concern, courtesy and willingness to give her information about her condition and treatment. On the other hand, she told us that she did not meet one nurse who was not helpful and supportive. Of course, that is just one person's experience, and I accept that it does not apply in the vast majority of cases. Nevertheless it should not happen, and we still have much to do to ensure that doctors treat women with this condition with the sensitivity that they deserve.
    Finally, I must also pay tribute to my own constituent, Mrs. Hazel Thornton, who came to give evidence to us. She is a lay person. After an abnormality was found in a routine screening, she was invited to participate in a randomised control trial. She was given no information about the options available to her, or any details about what the trial would involve, so she refused to take part. Instead, she found out for herself about the disease and became an expert on it.
    Since then, Mrs. Thornton has become a tireless campaigner for the rights and involvement of patients. She has set up the Consumers Advisory Group for Clinical Trials; she has written papers that have been published in The Lancet; and she has travelled across the world to give

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    talks on the subject. Due to her efforts, sometimes in the teeth of opposition from the medical establishment, the patient's voice is at last being heard.
    There is still an immense amount to do, but we are making progress. I hope that the Select Committee's report was a contribution to that, and I also welcome the response that has been made by the Government. I look forward to hearing the Minister's remarks later in the debate.
    5.41 pm
    Mr. John Austin-Walker: I share the view of the hon. Member for Colchester, South and Maldon (Mr. Whittingdale) that it is surprising that there is not more publicity about this matter. I doubt that there is anyone in the Chamber who is not either close to or who knows someone who is suffering or has suffered from breast cancer. I hope that the efforts that the national coalition has begun to bring groups together to give a much higher profile to breast cancer will succeed. I am sure that those efforts will receive support from all right hon. and hon. Members.
    Hon. Members have referred to the fact that the incidence of breast cancer in the United Kingdom is not particularly high by international standards, yet we have the highest recorded rate of mortality in the world. They have also spoken of the regional variations. There may be some arguments to the effect that data from other countries may not be comparable with ours. However, all the witnesses who gave evidence to the Select Committee concluded that even if Britain did not have the highest mortality rate in the world, it was one of the highest, and that it deserved urgent attention.
    In the United Kingdom it should be possible to rely on comparability of the data. In that context, the regional differences that have been highlighted are somewhat alarming. Some reasons have been advanced for those regional differences, but most members of the Health Select Committee came to the conclusion that the major reason for the differences in mortality was probably the poor treatment of the disease in some areas. I certainly believe that that is the most convincing reason.
    We know that the treatment that women get depends on where they go. The Select Committee heard much evidence, and there is more evidence from other sources—anecdotal and statistical—that many women do not get a quality service or appropriate treatment. It would be foolish to suggest that early diagnosis and early, appropriate treatment will lead to a successful outcome in all cases. However, if detection is not early or treatment is delayed or inappropriate once the disease is diagnosed, the consequences will—almost invariably—be tragic. The Select Committee concluded that it would be possible to reduce the number of deaths from breast cancer each year by some 4,000, if we had a standard quality of service throughout the country.
    Some people have criticised the Select Committee and the Government for putting too much emphasis on breast screening. They have suggested that screening is costly and detects only a minority of cancers. The latter is true and I share the view that we should always examine the cost-effectiveness of all screening programmes. However, I remain convinced that the screening programme should be maintained and improved as part of the overall strategy for detecting breast disease and reducing breast cancer mortality.
    1136
    The quality assurance programme referred to by the Chairman of the Select Committee is vital to ensure that the same high-quality service is available throughout the country. My hon. Friend the Member for Fife, Central (Mr. McLeish) expressed concern about the relationship between quality assurance teams and purchasers, following the proposed move from regional purchasing quality assurance to district health authority lead purchasers. As the Select Committee's report says, district health authorities
    "will be purchasing services for monitoring their own purchasing".
    I hope that the Minister will outline in his reply the role of regional offices and regional directors of public health in selecting the lead purchasers, and also the monitoring role of the national co-ordinator. That must be kept under review and I hope that the Select Committee will consider the issue once the new arrangements are up and running next year.
    Since the Select Committee report, there have been some developments in the way in which mammography is carried out, which we all hope will lead to a reduction in the number of false negatives and false positives. The possible tragic consequences of a false negative are only too apparent. More accurate diagnosis and early detection can lead to early and appropriate treatment. As my hon. Friend the Member for Fife, Central said, that can lead to more years of life of better quality.
    We should not underestimate the effects of false positive results, which the national co-ordinator described as a "downside to … screening". Such false positives not only cause great anxiety and in some cases severe psychological trauma, but they lead to women undergoing unnecessary recalls, further unnecessary clinical investigations, and in some cases unnecessary diagnostic surgery. I appreciate the view expressed by Hazel Thornton of Radiotherapy Action Group Exposure, who described the programme as
    "costly trawling of a limited asymptomatic public group … creating huge … psychological and physical morbidity".
    That is why it is important that we do our best to eliminate the false negatives and positives.
    The Select Committee believed, however, that there is definite evidence that screening by mammography is effective in reducing breast cancer mortality, certainly in women over 50. Evidence in the Forrest report convinced me that the only way substantially to reduce the number of deaths from the disease is detection before the patient presents with symptoms.
    The Select Committee takes the view that it is perhaps too early to make final judgments about the efficacy of the breast screening programme, because of the lead time. We need to observe the mortality information about 10 years from the introduction—after 1997—to get a more accurate picture. I believe that we will see then that the programme has been efficient and effective.
    The Committee has highlighted the problem of women placed on early recall, which might mean a wait not of a few weeks, as was suggested earlier, but of six to 12 months in some cases. Such insensitivity can lead to great anxiety, and in many cases acute depressive illness can follow. That is why I, and other members of the Select

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    Committee, urge the establishment of the one-stop shop. That may not necessarily reduce the time between screening and assessment, but it could significantly reduce the time between assessment and diagnosis and considerably minimise anxiety. That is why I believe it important to carry out the recommendations of the Forrest report for routine assessment teams comprised of clinicians, a radiologist, a pathologist, a radiographer, a receptionist and a breast care nurse. Breast cancer screening is not just to do with mammography; it includes all stages in the diagnosis of the disease.
    As the hon. Member for Broxbourne (Mrs. Roe) has said, it is generally accepted that there is little benefit in routine screening of younger women, but I believe that further research needs to be done to determine whether there are readily identifiable groups among the younger age groups who may be at higher risk and among whom prevention can be undertaken.
    The Committee was convinced of the efficacy of the screening programme for women over the age of 50, and firmly recommended that the upper age limit for inclusion in the call and recall system be extended to 69. The evidence for that is clear, and in this respect I found the Government's response extremely disappointing. I am firmly on the side of Age Concern, the British Medical Association and the Society of Radiographers. The decision to establish some demonstration projects may be a start, but it is not enough and it is quite disappointing.
    I urge the Minister to reconsider the Select Committee recommendation. What extra resources are being provided for these demonstration projects? The Government talk about advertising the fact that women over 65 are entitled to be screened every three years. I should like to know what resources have been allocated for extra screening to take account of increased take-up by the over 65s. Without such extra resources it will not be possible to screen more elderly people.
    Effective diagnosis is one thing: treatment is another. We have anecdotal and statistical evidence to show wide variations in treatments and outcomes. One thing is absolutely clear from the evidence—surgeons who treat more than 30 cases a year have better survival figures for their patients. Just as we need a team approach to screening, so we need a team approach to treatment. No woman should be referred to a general surgeon working in isolation. That is why the establishment of specialist breast units with defined minimum standards and service requirements is necessary. National standards need to be laid down, nowhere more so than in radiotherapy and related areas.
    The hon. Member for Colchester, South and Maldon spoke of the evidence given by RAGE. For some women, the treatment has been horrendous, leaving them either in pain or disabled. For some of them treatment can be worse than the disease. So the same quality of standards as is required for the screening programme needs to be applied to radiotherapy.
    In this respect I should like to mention recommendations 29 and 30 of our report. The Government rejected the recommendations calling for the same service quality standards to be applied to treatment and screening, and I found that rather disappointing. The two services are wholly complementary: they involve the
    1138
    same training and the same commitment to specialisation. Experience gained in one sector is also gained in the other. Of course some extra staff and resources would be required; will the Minister tell us why the Government rejected these two recommendations?
    I should like to return now to the role of breast care nurses, to which Conservative Members have already alluded. All the people with experience of breast cancer who spoke to us had nothing but praise for the nursing profession and for the crucial role that breast care nurses play. Obviously the remarks that follow will be from a male perspective, but many women who have been told they have breast cancer face not only the fear of the physical consequences—there is deep psychological trauma about the possibly tragic outcome of the disease—but a disease which attacks their identity as women. They feel that their femininity and their feelings about their sexuality are under attack. The women in this category to whom I have spoken have all said that the one person they could talk the matter over with was the breast care nurse. As one of the witnesses who came before the Select Committee said, "If nurses can communicate with us, why can't doctors?" So there is much that still needs to be done in terms of training the doctors.
    Gwyneth Vorhaus described for us the time when she was first diagnosed as having breast cancer:
    "I was left undressed in a cubicle for over two hours at the general surgeon's clinic. I finally wandered out into a room where a junior doctor was sitting looking at an X ray and I discovered that it was my X ray. I had previously been told I probably had fibro adenoma, so I had no reason to prepare myself or bring a friend. The doctor looked very embarrassed. He turned his back on me and started muttering about 'microcalcifications and suspicious lesions'. I had to ask him to turn around and look at me. I said, 'Are you trying to tell me I've got cancer?' He still could not use the word, but his body language told me something was wrong. I believe I went into deep shock at that moment, but I was left to wander off for an explanation to my GP."
    Perhaps that was an isolated incident, but as the hon. Member for Colchester, South and Maldon said, it is one incident too many. Other women's experiences may not have been as graphic, but witness after witness has described the insensitive manner in which her first diagnosis was given her. Meanwhile everyone praises the commitment and the work of the nurses.
    It is important to listen to what women have to say. I do not want to interfere in the debate about high-dose chemotherapy and stem cell rescue. Certainly, we heard Gwyneth Vorhaus say that she felt the treatment was right for her. We should do some random clinical trials to assess the value of high-dose chemotherapy. Most of us on the Committee felt that here was a woman who had exercised choice and weighed up the risks. She said that if nothing had been done she would have died. She was a mother of young children, so she felt that if anything could be done to extend her life by a couple of years, it should be done. For many of us that summed up the issue behind this disease.
    My hon. Friend the Member for Halifax (Mrs. Mahon) said in another debate on this subject:
    "it is important not to view breast cancer as just a woman's disease because it brings devastation and grief to families affected by a sufferer's early death."—[Official Report 15 February 1995; Vol. 254, c. 945.]
    Women with breast cancer are daughters, mothers, wives, partners, lovers. They have caring responsibilities, and their early and often unnecessary deaths devastate whole families; and the cost to communities is enormous.

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    When looking for the resources needed to build an effective screening and treatment programme we should always remember the 4,000 lost lives each year, and the costs of not saving them.
    The Government say that they are considering the Calman proposals; I hope that they will not hide behind them. I believe that breast cancer services can pioneer the way for other cancer services. Hence I hope that the Government will look again at some of the recommendations that they have said they will take account of in due course, and that they will react more positively to the firm recommendations in this report.
    5.58 pm
    Ms Jean Corston: I congratulate the hon. Member for Broxbourne (Mrs. Roe) and her Committee on this excellent report: it is most welcome. It is high time Committees of this House gave specific attention to issues involving women. I pay tribute to the many hon. Members who have kept the subject alive in the all-party group and other forums. I also pay tribute to my hon. Friend the Member for Halifax (Mrs. Mahon), who cannot be here owing to an Inter-Parliamentary Union engagement. I know that she would have liked to be here.
    In view of the fact that the Health Select Committee made reference to research, I am pleased to use this opportunity to raise a matter, about which the hon. Member for Broxbourne knows because I have written to her about it, and on which I was lucky enough to secure a debate during private Members' time on 14 June. It refers to research in breast cancer at the Bristol cancer help centre.
    The study was published in The Lancet in September 1990. I do not intend to waste the time of the House in rehearsing all the arguments, because they are on the record; suffice it to say that the research purported to show that breast cancer patients attending the Bristol cancer help centre who were also having orthodox treatment were twice as likely to die and three times more likely to relapse than the controls who were having conventional treatment only. It soon became clear that the research was fatally flawed in its methodology and statistical analysis.
    During a very helpful and constructive reply to the debate in June, the then Under-Secretary of State for Health, the hon. Member for Bolton, West (Mr. Sackville) said:
    "I have no doubt that mistakes were made".—[Official Report, 14 June 1995; Vol. 261, c. 758.]
    The funding bodies, the Imperial Cancer Research Fund and the Cancer Research Campaign, distanced themselves from the research quite early. The Imperial Cancer Research Fund said that no conclusions could be drawn. Its director general, Sir Walter Bodmer, said:
    "the research suffered from a disastrous mistake in the interpretation."
    However, the Institute of Cancer Research, which organised the research, still stands by it, and has refused to release the data for independent statistical analysis.
    A great deal of correspondence occurred over the summer, and I received a helpful suggestion from the Under-Secretary of State for Health, Baroness Cumberlege, in a letter on 4 August. She acknowledged
    1140
    that I had said that there was a need for an examination of how the two sets of patients compared, and that there should be an independent judgment of the validity of comparing the two groups. I asked whether the Department would recommend an independent statistician. The Minister helpfully suggested that I approach the Royal Statistical Society for assistance, and gave me its address.
    I put that suggestion to the person responsible for the research, Professor Claire Chilvers. She said that she was not in a position to be able to give that consent so I went back to the Institute of Cancer Research. Professor Peter Garland of the institute said that it would not be appropriate to release the data to me as a third party. The question is, who is appropriate? To whom should the data be released?
    Neither the centre nor the women involved want any follow-up research—it would be pointless and distressing—but there is a need to conduct a statistical analysis of the data. The issue raises questions about the nature of conduct in medical research, to which—obviously—the Health Select Committee has made reference. I am sure that it is concerned.
    In February 1991, the Royal College of Physicians published a very helpful document called "Fraud and Misconduct in Medical Research". It defined scientific misconduct at paragraph 2.7 as including—I stress the word "including"—piracy, plagiarism and fraud. The fact that the word "including" was used suggests that the definition was not intended to be restricted to those factors.
    The report continued, at paragraph 4.5, to say:
    "all institutions and responsible bodies must insist that raw data are kept available for inspection for 10 years".
    That prompts the question: inspection by whom?
    The United States Commission on Research Integrity has laid down the following criteria for breaches of research integrity: a misappropriation of data, misrepresentation of research findings, interference with results, and acts that compromise the integrity of the research process.
    It seems that the medical research establishment faces a clear choice. There is either resolution of the matters to which I have referred or there is eventual regulation. Although I am sure that the establishment does not really want the latter, such an issue cannot remain unresolved. While it is unresolved, it represents an obstacle not only to good medical research on cancer, but to broader issues of health research and scientific discovery.
    We are all, of course, conscious that large amounts of public money fund such research, so while it stays on the record, it is a stain on the character or reputation of an organisation. Frankly, I have been astonished by the number of health professionals who have said to me, "Oh, yes. We all know that that research cannot stand." Yet while that research is forming the body of scientific research and it is not retracted, that stain remains. Indeed, it calls into question the way in which people behave when they conduct scientific research.
    I call on the Institute of Cancer Research to release the data. It has to be said that The Lancet, in which the study was published, has not published a retraction, although it would be right to add that the new editor is doing his best to draw together the interested parties in order to resolve the matter. It is important that the editor of The Lancet is

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    able to make progress, so that a retraction can eventually be printed, subsequent to—I hope—independent statistical analysis.
    Last night, at St. James's palace, the Prince of Wales held a reception in honour of the Bristol cancer help centre. He made reference to the research, and regretted the negative effect that it had had on the centre. Naturally, if such research stands on the record, charitable foundations and others will find it difficult to make donations, given that it could be said that they were spending money on an institution that has damaged people's health. It is perfectly obvious that that is not case. The Prince of Wales praised the centre's holistic approach and the way in which it focuses on the whole person rather than the illness, the cancer.
    I am pleased to say that the centre, which was facing closure this month, has succeeded in raising £267,000 to enable it to continue for some more time. It is very keen to preserve the principle that the care, advice and treatment it gives should be free, and it does not deserve to live under such a cloud. I hope that it will be possible for the matter to be resolved, because it will not go away. I know that other hon. Members, whose support I have appreciated over recent months, share my concern and want to assist me in ensuring that the public money put into that research was not wasted, and that the facts emerge from some statistical analysis.
    I should like to turn specifically to a couple of items in the Select Committee report. Its first conclusion states:
    "It is clear that the aetiology of breast cancer is not yet sufficiently well understood to enable any systematic attempt to reduce mortality by primary prevention to be pursued".
    Although that conclusion says "any systematic attempt", other factors of scientific literature ought to form part of our understanding; it would not be right to say that nothing that can be done.
    In considering just a few instances of scientific research, one finds that it is pretty certain that, if one eats animal fat, one has a 30 per cent. higher chance of getting breast cancer. If one smokes, one has more chance of getting breast cancer—and any cancer. If one is a vegetarian, one is 40 per cent. less likely to die of cancer of any sort. I understand that that research comes from Dr. Margaret Thorogood.
    I must declare an interest, because I have not eaten meat for 10 years. I do, however, eat fish. I do not want to advance any argument about vegetarianism. I am aware that there is other relevant research. For example, the King's college study tells us that the incidence of breast cancer is four times higher in people who are under stress.
    Only this week, on 9 December, the British Medical Journal contains an article about a research paper on breast cancer. It states:
    "Key messages: life events have an important influence on physical health; women with breast cancer have more severe life events in the five years before diagnosis; the way a woman deals with stress may also affect the risk of breast cancer".
    I understand that there was a United States-funded study of 50,000 Chinese subjects who were given vitamins A, C and E and selenium. They had a relatively low vegetable intake, but their cancer death rate declined
    1142
    by 13 per cent. after five years of that treatment. The United States Government have issued guidelines on diet and cancer since 1983.
    Furthermore, the Cancer Research Campaign has conducted what could be described as an epic trial. The preliminary results are based on considering cancer in relation to dietary habits throughout Europe. They reveal pronounced variations. There is a far lower rate of cancer in Greece, where people eat a great number of vegetables. Holland and the United Kingdom came out worst. Our respective diets contain more dairy products, such as cheese, cream and yoghurt.
    The Women's Environmental Network conducted research into pesticides and insecticides, specifically organochlorines. It found that, in countries where Lindane had been banned, the incidence of breast cancer in the youngest group had declined by about 24 per cent. I know that there are concerns about the reliance that can be put on that sort of research, but it is part of the scientific body of opinion.
    There is also the research by Peto and Doll of 1975 and 1992, which found that diet is the greatest environmental factor. It has a contribution rate of 35 per cent., whereas smoking has one of 30 per cent. It cannot be said that research findings are not sufficiently understood to enable any attempt to be made to make improvements. We have quite good statistics.
    It is important to consider, as hon. Members on both sides of the House have, the disparity between the incidence of breast cancer and mortality rates. For example, the incidence is higher in the United States, but mortality rates are lower than elsewhere.
    It is important also to consider the findings of Dr. Stephen Greer, which might be dismissed by some. He classifies personality types, and goes on to consider how classification may influence survival. I know from medical professionals in my family that there is much interest in the profession about Dr. Greer's findings. He categorises people according to personality. Of those with what he describes as fighting spirit, 80 per cent. were alive after 13 years. Of those described as helpless and hopeless, only 20 per cent. were alive after that period. He describes those in between the two categories as demonstrating denial or stoic acceptance.
    Those who come within the higher mortality rate tend to be more passive and compliant patients. Indeed, the word "patient" imports something about compliance and passivity. It suggests that the person is one to whom other people do things, rather than someone who is an equal partner in treatment, cure and survival.
    The message is often given that people can do nothing to help themselves. Institutions such as the Bristol cancer help centre are vital in the way in which they encourage people to develop a fighting spirit and a belief that they can be part of their own cure.
    Last night, I met people at St. James's palace who had been told 16 years ago that they had three months to live. I met a man who had had two thirds of his liver removed. He was told that there was cancer in the remaining third and that there was no hope for him. He is still alive nine years later.
    The message is that people can live with cancer. A cancer patient should be seen as part of the healing process. The work of complementary practitioners, such

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    as those at the Bristol centre, can be extremely valuable as an adjunct to the conventional treatment that is provided by the national health service. Their work is no threat to conventional medicine.
    There is evidence that people want complementary treatment. More and more general practitioners want training in it. I hope that purchasing institutions will take note. It is important to take things in the round. We know that people say that they do not want to be a nuisance to their doctor. They fear that, if they are assertive, they may not be treated well in future. I feel that a different attitude is required of some doctors.
    Where it is the only route, the Bristol centre helps people to prepare to die. That is important. So often, people are sent home to die and told that they have three months and they must get on with it. On one occasion only, I came across a friend who had something to do with the Bristol centre. That was in the 1980s. She was dying with cervical cancer. She had had four cervical smears, and had been told that she was clear. It was suggested that she was hysterical. It turned out that she was right. By the time her rightness was acknowledged, it was too late.
    My friend went to the Bristol centre when she was clearly dying. No one could have saved her life. Those at the centre gave her control over the last few months of her life. They made it into a remarkable period.
    Obviously, research is important. Everything to which hon. Members have referred in the debate is important. I wish to be specifically identified with the comments of my hon. Friend the Member for Fife, Central (Mr. McLeish), who spoke from the Opposition Front Bench. It must be recognised, however, that a patient is not merely someone to whom things are done. A patient should be part of the treatment, cure and survival.
    6.15 pm
    Mr. Simon Hughes: The debate has been widely welcomed, and I join that welcome. It demonstrates the benefit of the Select Committee system, which we have had for some years. A Select Committee may decide to examine a matter of major public interest. It will do its job properly, and update itself. It will report to the House and then ensure that the issue becomes part of the wider agenda. I, too, pay tribute to the hon. Member for Broxbourne (Mrs. Roe), the Chairman of the Select Committee on Health, to all members of that Committee and to all those who have contributed to the debate. This is not a party political subject.
    I speak as a lay person. As a man, I come to a debate about an issue that principally concerns and involves women. I have learnt from reading the Select Committee's report and the minutes of some of the evidence. I have listened to colleagues, and I have checked some of the facts. I am aware of the severity and importance of the issue.
    As the hon. Member for Colchester, South and Maldon (Mr. Whittingdale) said, we should draw ourselves up and remind ourselves of the lethal nature of cancer in general, and of breast cancer in particular. We should make ourselves aware of the number of people in this country, irrespective of the relative figures, who continue to die of the disease when compared with those who die from other diseases that are more often talked about.
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    Like the hon. Member for Woolwich (Mr. Austin-Walker) and other parliamentary colleagues, I have both parliamentary and personal experiences of those who have become ill with breast cancer. Some have come to my surgeries over the years. They have told me about insensitive responses. I endorse the claim that these stories have featured only doctors, never nurses.
    It has been clear to me throughout that, specifically and psychologically, breast cancer is one of the intrinsically important areas of concern when dealing with women's health. If it is not treated properly, irrespective of whether, at the end, the condition is curable, it is something that undermines a woman's sense of her integrity, self-respect and self-worth. The disease goes to the heart of those people's being. Breast cancer is hugely important. It is not something that is peripheral to the health service; it is not something that matters only physically. It matters much more than that. Men know that, as well as women.
    Most of us have known, many of us from personal experience, of people who have died unnecessarily in the sense that there was not sufficiently early diagnosis. It is not a secret that, a couple of years ago, I lost a brother. He died of malaria. He died because the condition was not diagnosed quickly enough. In days, he went from being ill with what was thought to be flu or a cold to dying from malaria.
    For many women, that is the story with breast cancer. One fact that emerged clearly from the evidence to the Select Committee inquiry was that, despite our best efforts, the continuing failure by many women to present themselves, and the consequent failure to have proper treatment at an early stage, is one of the causes of the high mortality rate thereafter.
    The first message that the House has heard—I hope that it is going out clearly from the Chamber tonight—is that there is every need for women to make sure that they present themselves for screening. The screening programme is hugely important, and as yet it has not reached everybody who needs it. Given the high proportion of older women who suffer from breast cancer, we must remember that presentation for screening will become increasingly important as the number of older women increases with the longer lives that, happily, people in general will lead.
    So first let us encourage people to come in. I say that as somebody who, probably like many Members of Parliament, is very sceptical as a patient in the health service. I am not naturally someone who goes running to the doctor. I tend to assume that there is not a problem, and that things will get better.
    Many other people do the same, and we must persuade ourselves and others how important it is not to take risks. After all, we are talking about health care that is preventive, not only in terms of one's own illness and of the consequences to one's family, but even, as the hon. Member for Bristol, East (Ms Corston) rightly said, in terms of the cost to the nation. Early diagnosis and treatment can be a way of saving lives—and money.
    As hon. Members will know, I have the privilege of being the Member of Parliament for Guy's hospital. One of the people who gave evidence to the Select Committee was Dr. Michael Richards, who spoke both as a consultant at Guy's and as a representative of the wider community of cancer consultants.

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    Guy's is one of the leading centres for treating breast cancer and doing research into it, and one thing that emerged clearly from Dr. Richards' evidence was that we still have not organised ourselves as well as we could to maximise the efficiency of that work. The hon. Member for Broxbourne and other hon. Members have pointed out that the diversity of places and units in which treatment is carried out, and the small number of cases that many doctors treat per year, militate against best practice.
    It is a fairly trite point, but if a doctor sees only one or two patients a year, he or she is far less likely to be competent or expert at giving the best diagnosis, results, advice, treatment and so on. It is important that, although of course there must be neighbourhood access, there should be consolidation of the best practice into the size and sort of unit that the Select Committee, and the expert evidence it took, recommended.
    Thirdly, there appears to be clear evidence that we are not training enough people to deal with breast cancer as consultants and nurses. I do not know whether the figures that I have are still accurate, but I understand that, for example, there are only about one tenth as many consultants dealing with breast cancer in this country as there are in France. There is a real dearth of experts.
    Likewise, one of the recommendations shows that there is a clear shortage of funds for training nurses and others who have the responsibility of care. That is completely unjustifiable. If cancer is identified in 5,000 new cases a week in this country, that means that as many cancer cases are diagnosed each fortnight as there have been AIDS cases diagnosed in the past 10 years. I say that not in any antagonistic way, but simply to show the scale of the problem that we are discussing. We must react to that by having enough experts—consultants and nurses—available throughout the country, region by region, easily accessible and able to respond to the need.
    That leads me to my fourth and most important point. It is clear that with breast cancer, research financed by independent research institutions has been enormously valuable. Such institutions pay for much of the work done in the NHS. People such as Dr. Richards are funded entirely by the Imperial Cancer Research Fund. Many consultant posts, and even whole units, are funded by private charitable money.
    Yet we are still miles short of the money that we need to carry out the research programme satisfactorily to a conclusion. In a paper on clinical research produced only about a year ago, Walter Bodmer wrote:
    "Taking eight hundred million pounds as the total spent on medical research as a whole, and assuming, say, only a quarter of this is really clinical research, gives two hundred million pounds as the total spent on clinical research. The extra NHS costs connected with adequate provision for that clinical research would therefore be one hundred million pounds."
    Much more recently, after one of the reports that came out this year, the Kenneth Calman report, the Government's response was that there would be no additional new money for the research and treatment services for which the need is clearly identifiable.
    The recommendation made by the chief medical officer in April, only eight months ago, was that £200 million was needed to fund changes that would save 15,000 lives a year,
    1146
    by establishing the regional specialist centres that we have talked about. However, the Department of Health says that those costs must be met from existing resources.
    I say to the Minister, although again not antagonistically, that I have no doubt that the British public out there would say that we must find that money. It is not acceptable for such areas of work in the health service to be held back, when there is no dispute about what needs to be done. It is clear that we must go on putting in the money to encourage more people to be screened, so that more people can be diagnosed early, and so that more research can be done and more people trained to treat the patients.
    That is money that the nation must find. If there is a choice between, to put it crudely, tax cuts or more money to reduce the number of deaths from breast cancer, I am sure that the nation would vote for the money to be spent on cancer treatment rather than on tax cuts.
    Although of course the debate has rightly centred on breast cancer—long may it continue to do so—the lessons apply equally to other cancers. The report, and all the other abundant evidence, makes that clear. Perhaps men are worse than women in terms of their willingness to present themselves for screening and the like. But it is most important that we develop screening programmes for other cancers both for women and for men, in all age groups, and that we encourage people to educate themselves about their health and to identify, or to give the experts the opportunity to identify, disease at an early stage.
    We must remember that we have a long way to go before we have a system in place to enable us not only to deal with the diseases once they are identified but to ensure that people present themselves early enough for diagnosis and treatment to take place early enough to prevent death. The figures show that, once diagnosed, about half the cases can be treated in such a way that death is prevented.
    That being so, we are only at the beginning of the road. I hope that we shall respond rapidly to the excellent work of the Select Committee, and to all the other supportive work that makes it clear that we as a country could take much more effective action on breast cancer, if only we had the mind and the resources to do so.
    6.28 pm
    The Parliamentary Under-Secretary of State for Health (Mr. John Horam)rose—
    Rev. Martin Smyth rose—
    Mr. Jeremy Corbyn rose—
    Mr. Horam: I hope that it will be for the convenience of the House if I intervene at this point. I apologise to the two hon. Gentlemen who want to speak, and I shall try to ensure that there is time for them to come back after I have spoken. But if I do not speak now there is a danger that I might be squeezed out of the debate, which would not be in the interests of the House.
    Mr. Corbyn: That is not our intention.
    Mr. Horam: Nevertheless, I ought to get in to the debate now; otherwise there may be a risk. I believe that we have to finish at 7.4 pm promptly.
    First, I am delighted that there is a health subject for debate today. Secondly, I am particularly glad that my hon. Friend the Member for Broxbourne (Mrs. Roe) has

    1147
    been able to secure the subject of breast cancer for the debate, as it is a matter of great concern to us all because of the incidence of the condition in the UK. I also congratulate the Select Committee on Health on its report on the subject, which has been widely welcomed by Members on both sides of the House.
    I congratulate my hon. Friend the Member for Broxbourne on her report. My hon. Friend has been a particularly vigorous and effective Chairman of the Select Committee since she took on that responsibility. She has a number of successes to her credit, of which this report is one. I think we all agree that it is an excellent report. It is also fair to say that there is extensive all-party parliamentary interest in this matter.
    The Health Committee has considered ways in which the quality and availability of breast cancer services in the UK might be improved, concentrating particularly on the progress made by the breast screening programme in reducing breast cancer mortality, the role of clinical trials in evaluating treatments and ways in which more women might be recruited into trials and the benefits of specialised breast units in the provision of high-quality breast cancer care.
    The all-party breast group has explored issues around rising incidence, mortality, treatment and research, and called for a national strategy for breast cancer. The group has done much, in my view, to make its presence felt and has lobbied on behalf of the thousands of women who contract this terrible condition each year.
    I am pleased that hon. Members on both sides of the House share our concerns about the high level of breast cancer incidence and mortality. Hon. Members have already told us this afternoon of the statistics, but they are worth repeating because they are truly dreadful. Breast cancer is increasing internationally, with registration data for England and Wales showing that age-standardised incidence rose by 22 per cent. between 1979 and the latest available figures. We know that there are even greater increases in other comparable countries. In England and Wales, breast cancer is the leading cause of cancer deaths in women. Each year, some 27,000 new breast cancer cases are registered and some 13,000 women die from it.
    No Government could underestimate the seriousness of a condition which affects so many women, or results in so many deaths each year. We do not know why breast cancer is increasing internationally, but some suggestions have been made. My hon. Friend the Member for Colchester, South and Maldon (Mr. Whittingdale) suggested that an aging population was one possibility, and obesity is another possible factor. The rate of incidence is higher in developed countries—particularly western developed countries—than in less developed countries.
    These are all suggestions, but—as has been stated in the debate—there is little evidence to suggest that there are clear links between the various factors involved in this dreadful disease. I emphasise to the House that, while these are the facts, we must take account of the evidence of increasing mortality. We have to take breast cancer very seriously, and we do. That is why in 1987 we announced the setting up of a breast cancer screening programme throughout the UK—the first of its kind in the European Union and one of the first in the world.
    All women aged from 50 to 64 are invited for a three-yearly mammogram, with women aged 65 or over being screened on request. Some £55 million has been
    1148
    allocated to establish the programme in England, with £70 million being spent on the programme for the whole UK. Funding for running the services has now been built into health authorities' allocations at an estimated cost of £27 million a year.
    The screening programme is a success, and I am pleased that the Committee accorded it such praise. I am sure that the whole House will join me in congratulating those who work on the programme. A number of hon. Members made that point, and I would like to underline that. The breast screening programme is now screening some 4.5 million women and has detected more than 26,000 cancers, many at an early stage when treatment is more successful.
    Fewer women are being recalled unnecessarily, and every precaution is taken to minimise women's anxiety about the test and about recall for further assessment. A number of hon. Members—including my hon. Friends the Members for Croydon, North-East (Mr. Congdon) and for Colchester, South and Maldon, and the hon. Member for Woolwich (Mr. Austin-Walker)—made this point. It is a very serious matter and while the situation is getting better, there is clearly further to go and I want to see progress being made.
    I come now to quality assurance questions. We built quality assurance standards into the programme from the start, and we will continue to monitor achievement against these standards. I appreciate, though I do not accept, the Committee's concern that devolving of purchasing of quality assurance to health authorities could lead to a pursuit of cheaper options than the gold standard set nationally. We believe strongly that the independence and effectiveness of the quality assurance programmes will continue to be guaranteed by the regional directors of public health, who have been charged with ensuring that quality assurance continues, and by the national NHS screening co-ordination team.
    My hon. Friend the Member for Broxbourne asked me for a particular assurance in her speech. She said that there was a danger that the QAP would become simply a means for purchasers to check on provider units, and she asked whether it would continue to ensure that the service which is purchased meets the national standard. I am glad to say to my hon. Friend that the answer to that is yes. The regional directors of public health have been charged with the task of ensuring that quality assurance is purchased to the standard set nationally, and that the service continues to the current high standards. I give her an unequivocal assurance on that point.
    The breast screening programme has been based on firm evidence, and one of its strengths is that it is constantly reviewed to ensure that standards are kept up to date. That is why we introduced last August the taking of two views of each breast for all women attending their first screening appointment. We have also announced proposals for the setting up of pilot projects to evaluate the effectiveness of extending the screening programme to women up to the age of 69. That is a particular point of concern which I fully accept, given the mortality rates among women in that age group. I am glad to say that we are making progress in that area. A number of hon. Members made that point, and I can reassure them that—as far as I am concerned—the matter will be a high priority.
    We are funding further research into the effectiveness of screening women from the age of 40 and screening more frequently and exploring the management of screen-

    1149
    detected ductal carcinoma in situ. That is going on, although I think that the priority is women up to the age of 69.
    A mark of our commitment to cut breast cancer deaths is shown by the fact that we have made this a target in our "The Health of the Nation" initiative. Our goal, as has been said during the debate, is to cut the number of deaths among women invited for screening by 25 per cent. by the end of this decade. That should mean a saving of at least 1,250 lives each year in England alone.
    I wish to say something at this point on the question of the regional variations in the figures, a subject mentioned by the hon. Members for Doncaster, North (Mr. Hughes) and for Fife, Central (Mr. McLeish). The hon. Member for Fife, Central made a point about access to screening, but I think he used the wrong word. In looking at the regional and district variations, he should have said take-up instead of access.
    There are clear differences in the extent to which screening is taken up in different areas, and it is true that take-up is much lower in inner-city areas and poorer districts. Therefore, health authorities have undertaken specific initiatives and have set local targets to add to the national targets to deal precisely with this matter. There is a difference in the take-up rate, not the access rate. Access is the same everywhere, and everyone gets the same treatment. This difference will be tackled by local initiatives, research into which will be funded by the Department. We are tackling the problem of different levels of take-up in different areas.
    A separate point was made by the Opposition spokesman, the hon. Member for Fife, Central and by the hon. Member for Doncaster, North about mortality rates and whether we were on target. The only sensible, tested mortality rates are for 1993. We started the programme only in 1992 so it is absurd to say one year into a programme that is meant to last the eight years until the year 2000 that we are some way off target. We clearly are not off target. We believe that we are absolutely on target.
    Mr. McLeish: The subject of our exercise was to look at the base year that the Government selected—1990—take it through to the most recent year—1993—and project the annual current rate forward to 2000. I suspect that, in many respects, that was not the most scientific of exercises, but it extrapolated the trends and showed that up to 60 of the district health authorities did not meet the target. The Minister rightly criticises our figures, but can he provide for me either in a letter or now some analysis carried out by the Government to find out whether the DHAs are on target, even though they are using a national target in local areas?
    Mr. Horam: I will look into the additional point made by the hon. Gentleman, but it is our firm view that we are on target.
    Of course, we would like to be able to prevent breast cancer occurring at all, but so far, despite enormous levels of research both here and abroad, we do not know how to do so. The trial currently under way in the NHS to evaluate the effectiveness of tamoxifen in preventing breast cancer in women at particularly high risk may help. However, we must be cautious. The beneficial effects of
    1150
    tamoxifen must be weighed carefully against its side effects. It may be years before we know whether it is a real option for preventing breast cancer.
    Substantial work is also in hand to identify the gene defects which cause breast cancer in a minority of women, but that work will not stop the problem. Even if we reach the point at which we can identify that a woman is likely to develop cancer because of her genetic make-up, we do not know, despite research, what we can do to stop the cancer developing. Even the most radical option—surgical removal of the breast—does not offer a concrete guarantee, as there is still a remote possibility that the disease could spread before preventive surgery is performed. That is why the Government have put so much research into establishing a national population-based screening programme. Experts agree that early detection is of enormous value in combating breast cancer and improves the chances of effective treatment.
    Even recently reported critics of the programme have acknowledged that at present screening remains the best option for women and agreed that the programme should continue. However, screening is only part of the story. All women with breast cancer should have access to good advice, treatment and care, wherever they live. We know that at present there is variety in provision for breast cancer around the country and that some patients seem to have better treatment outcomes than others. The choice of treatment required in individual cases will vary depending on a number of factors, including the stage and site of the cancer and the general health of the woman. Studies of adjuvant therapy indicate that a combination of treatment options—surgery, chemotherapy, adjuvant endocrine therapy—is highly effective, but circumstances differ in individual cases. Clinicians should choose a treatment regime best suited to the individual, after discussion with the patient.
    There is increasing evidence that women treated by surgeons and teams with a degree of specialisation in breast cancer have better outcomes. That point has been made in the debate. Concerns about the evidence of variations in cancer treatment options and outcomes led the chief medical officers of England and Wales to ask their expert advisory group on cancer to review how cancer services, including breast cancer, were delivered and to make recommendations for improvement. Following wide consultation, my right hon. Friends the Secretaries of State for Health and for Wales unveiled on 24 April 1995, a new strategic framework for the future development of cancer services.
    The report recommends a network of specialised care with cancer services organised at three levels. Primary care is seen as the focus of care, with GPs better informed about the availability of diagnostic and treatment services to allow them to make appropriate referrals and to be informed promptly about the outcomes of tests and of any treatment.
    Cancer units will be created in many local hospitals of a sufficient size to support a multi-disciplinary team with the expertise and facilities to treat the more common cancers. A lead clinician will co-ordinate cancer services and develop treatment protocols between primary care, cancer units and cancer centres to ensure a network of care of a high standard. Cancer centres situated in larger hospitals will treat the less common cancers and support cancer units by providing services, including radiotherapy, not available in smaller hospitals.

    1151
    The NHS has already taken forward a great deal of work, making good progress towards the .implementation of this new strategic framework. Key elements in this are, first, regional mapping of current patterns of provision of cancer services, work to designate cancer units and cancer centres, discussion to develop explicit contracts between purchaser and provider for the provision of cancer services and plans for improving the availability and quality of data.
    Simultaneously, in order to support work being taken forward regionally, the NHS executive has commissioned work to prepare evidence-based guidance in a rolling programme of work starting with the more common cancers to help purchasers and providers identify cancer units and cancer centres. Recommendations will be made on the characteristics which are necessary if a centre or unit is to be effective. They will cover the specialisation required, compatible with a high quality of service; where appropriate, guidance on the clinical management of cancers; and ways of measuring the quality of care delivered, including measures of outcome. Guidance on breast cancer will be the first product of this programme of work and will be delivered in spring 1996—not too far off.
    My hon. Friend the Member for Broxbourne said that we did not want consultants to hang out a notice, as she put it rather graphically, saying, "Specialist Breast Unit", even though the unit had no special expertise. I hope to assure her that the programme that I have just outlined is designed to deal with precisely that point. It should succeed in doing so. I remind the hon. Member for Fife, Central that part of the programme will examine the evolving national picture. That will answer some of his concerns.
    Concern has been expressed about research funding. I agree that we will secure reductions in deaths only if our services are built on the basis of sound scientific knowledge. In Britain we have a record of excellence in research in this area. Ours may not be the largest programme in the world, but the work is of a very high quality, and we can be justly proud of it. Moreover, it is a research programme which is well supported by many interests. The medical research charities play a significant role in the national endeavour to combat cancer, based on generous donations from the community. The contribution by drug companies is also very high. Of course, the Government are also a major player, in collaboration with those other bodies. Collaboration in research extends right across the European Union.
    The Medical Research Council funds important research on cancer generally, and breast cancer in particular, including work on diet and on breast tumour imaging. It is also a key player in research to evaluate the breast screening programme, which hon. Members have rightly discussed at some length. Total spending on breast cancer research was £14.2 million in 1994-95. Total spending on cancer research as a whole is now approximately £250 million. We must remind ourselves that there are no fewer than 200 forms of cancer, so there is a great deal for the money to cover. In addition, clinical research is supported by NHS research programmes and NHS excess service costs attributed to cancer research. The value of this additional expenditure is significant and will become increasingly apparent.
    My hon. Friend the Member for Broxbourne suggested that we might use the United Kingdom Co-ordinating Committee on Cancer Research to channel funding from
    1152
    the Department and the Medical Research Council. The danger is that we would lose flexibility. Improvements in research do not flow in an even stream. We cannot predict exactly what the volatility will be between one year and the next so some flexibility is essential in the research programme. We cannot meet my hon. Friend on that point.
    My hon. Friend was also worried about indemnity for clinical trials, which remains a problem, and asked me to say how far we had gone in the review. We are making satisfactory progress. I hope that we shall be able to report at least some initial findings early in the new year. We are therefore dealing with that matter.
    In conclusion, as I am anxious to allow the two hon. Members time to contribute to the debate, we are working on the progress already made to ensure that we can further reduce mortality from this serious condition. As has been said, the effect of screening on mortality will take some time to work through, but we estimate that 1,250 lives will be saved each year by the year 2000 and I emphasise that we are making good progress towards that end.
    Moreover, in response to recent research findings, we have announced a package of quality initiatives further to strengthen the screening programme, some of which I mentioned today. Finally, in response to emerging evidence of variations in cancer treatment options and outcomes—a concern expressed both by Conservative and by Opposition Members—we have launched a new strategic framework for the organisation of cancer services, which it is predicted can increase long-term survival. Although full implementation is likely to take some years for what is a very ambitious programme, I am confident that significant improvements will be made soon.
    6.50 pm
    Mr. Jeremy Corbyn: I shall be brief to allow the hon. Member for Belfast, South (Rev. Martin Smyth) the chance to speak during the last 14 minutes of the debate. I was sorry that I could not speak before the Minister, as I wanted him to answer some questions, but he can no doubt write to me or intervene.
    Like many other hon. Members, I welcome this debate and the report that has gone with it. The House should bear in mind the detailed work that the Select Committee on Health has done on the subject and the huge amount of evidence that it has taken from a wide range of organisations, which must add to the strength of that report.
    We must also welcome the fact that this is the third time this year that the House has debated breast cancer. There have been two Adjournment debates—I initiated one and my hon. Friend the Member for Edinburgh, Leith (Mr. Chisholm) the other—and now this debate on the estimates and the Select Committee report. The fact that there have been three debates in a year seems to show growing understanding among many people that there has been a large increase in breast cancer and that its treatment here has a low success rate compared to that in some other countries. We must consider that treatment seriously, but we must also consider the causes of breast cancer. I draw the attention of the House to the powerful speech by my hon. Friend the Member for Bristol, East (Ms Corston). She mentioned the contributions made by diet, stress factors and living conditions.
    I was also impressed by the point made by the hon. Member for Colchester, South and Maldon (Mr. Whittingdale), among others, on the way in which

    1153
    nurses and doctors treat people. It is certainly my experience that anyone who goes into hospital for almost anything generally has high praise for the nursing auxiliaries and administrative staff, but criticisms of the way in which the medical staff treat them.
    Often the medical staff are incredibly highly pressed, and they tend to leave the talking and caring role to others. Frankly, that is not good enough. Highly experienced medical staff, such as doctors, specialists and consultants, should spend more time with the patients if they can and should be straighter about what is wrong with them. They should also understand the degree of shock that a woman suffers when they tell her that all the investigations unfortunately show that there is a serious problem and that breast cancer is present. They should talk the thing through. It is an amazing shock, and although men obviously do not experience breast cancer, they have experience of other forms of cancer. Perhaps the Department could do something about attitudes and training. The Minister might like to reflect on that issue and think of doing some work or having discussions with medical colleges on that aspect of training.
    I must make a brief point, but an important one. In my Adjournment debate on 22 November on breast cancer and its victims, I relied extensively on information supplied by Radiotherapy Action Group Exposure, which gave evidence to the Select Committee on compensation for victims of treatment. In some cases, we are talking of women who were treated with radiotherapy many years ago. It may well have cured the cancer, but the side effects and long-term effects have been almost as serious as what was there in the first place—the loss of the use of some limbs, permanent disability and a high level of constant pain, which is something that no one should have to live with all the time. Many of those women have suffered grievously and are still suffering. It is a humbling experience to talk to them about the ways in which their lives have been affected. In some cases, the problems occurred because of accidents, in others as a result of misdiagnosis, and some were caused because, at the time the radiotherapy treatment was given, those who gave it were unaware of its power, or of the importance of targeting the radiotherapy at the cancer cells with absolute accuracy because of the danger of wide-scale tissue damage to the surrounding area.
    As part of their campaign for recognition and compensation, the women have been asking for a system of no-fault compensation. The Department has constantly replied that, although it understands their concern, it is not persuaded of the case. It has said that the women should take their cases to court individually. As has been pointed out in the debates, that is not a runner. Either one has to be very rich to afford to undertake a High Court action that can easily cost £200,000, particularly if it is not successful, or one has to be so poor and have such a strong case that one can get it all done on legal aid. Also, it is not a runner because the fault of an individual or organisation must be proved. That is the great failing because many of the people who gave the treatment could justifiably say that there had been a genuine accident on their part and could claim ignorance of the consequences of the treatment.
    I have two brief questions for the Minister. First, when the then Under-Secretary of State for Health, the hon. Member for Bolton, West (Mr. Sackville), replied to the
    1154
    debate on 22 November, he mentioned the examination and report that the Royal College of Radiologists was to undertake shortly. Many people were concerned that the college was undertaking the research and thought that there should have been an independent inquiry—perhaps semi-judicial—into the problem of compensation for victims of radiotherapy. He said that he would rather await the college's report. As it is now out, I would be grateful for the Minister's response.
    Secondly, on accountability, the then Under-Secretary of State said:
    "Our legal system holds all individuals accountable for their actions, which arguably has a deterrent effect on malpractice. No-fault compensation could remove or weaken it."
    That might well be so, but it does not answer my earlier point about changed systems, technologies and knowledge. In response to an intervention from my hon. Friend the Member for Glasgow, Maryhill (Mrs. Fyfe), he went on to say:
    "Although I have outlined some of the reasons why no-fault compensation has been thought inappropriate, we have recently accepted that a system should be tried for mediation in such cases. The Minister of State recently agreed to set up pilot mediation schemes that may make it easier to reach agreement. We have no wish gratuitously to defend certain cases or to cause any unnecessary delays."—[Official Report, 22 November 1995; Vol. 267, c. 639-40.]
    I would be grateful to hear what progress has been made and whether the Minister is prepared to reconsider the whole question of a no-fault compensation system to deal with the problems that those women have suffered or are still suffering and that have caused them to incur enormous and horrendous expense merely because they are the victims of problems caused by radiation treatment given when they were dangerously ill with cancer. Obviously, they are grateful to be alive, but they should be able to live decently, and that requires them to be compensated for the injuries that they have suffered.
    6.58 pm
    Rev. Martin Smyth: I appreciate the fact that I have a few minutes to comment and recognise that the response from the Department of Health included Scotland, Wales and Northern Ireland.
    I was happy to be a member of the Select Committee on Health which considered the problem. Interestingly enough, since the report was commissioned and the Government response issued, I have received one of the largest mailbags I have ever had. People have been writing to urge us to ensure that the Government implement the recommendations. The Government generally welcomed the report, with one or two qualifications, which I would ask them to reconsider. They can do something positive.
    I regret the fact that I was not present for the central part of the debate—I was speaking to a professor from one of the medical schools in Belfast. I discovered to my amazement when I entered the Chamber that the hon. Member for Southwark and Bermondsey (Mr. Hughes) was talking about research in the Department and the fact that the Northern Ireland Department of Health and Social Services has not been appointing a director for research and development. There is supposed to be a fixed percentage of the budget for that. This year, no clinical research awards at all have been made in Northern Ireland. I ask the Government to reconsider the use of the funds that are available to develop that aspect.

    1155
    I pay tribute to the work of Action Cancer, which has pioneered going out into the workplace and the rural community with a mobile van so that people can have mammograms taken in their communities without having to travel to Belfast. When we recently met the Minister responsible, he assured us that the claim that Action Cancer would have to foot the bill for that work—it provides coaches, and so on—was false. I have discovered from the tissue typing pool in the city under the new trust scheme that it has to be paid by Action Cancer. The Minister assured us that that was false. I ask the Minister to press the Department, and perhaps particularly the Eastern health and social services board, to pay the bills for which it is responsible. It is an abomination to expect a charity to start doing that work over and above the other work that it is doing.
    I sympathise with the hon. Member for Islington, North (Mr. Corbyn) who again raised the issue of RAGE, Radiotherapy Action Group Exposure, and put it on record that the arguments for specialist breast centres stem from that. It is obvious that some people who were not expert in the field gave wrong advice and, as a result, some patients live in perpetual pain and suffer from paralysis and disability. The argument is clear that specialist breast centres are needed throughout the nation. It is not only national centres of excellence for breast screening that are needed; we also need national centres for breast treatment.
    I draw attention to Professor's Blarney's response. As a world specialist in the field, he recommended in December that there should be movement. He stated:
    "Our argument is that a very good service was introduced for breast screening, precisely the same service is required for women presenting with symptomatic breast disease. Why not emulate this successful model?"
    Why not let the nation take the lead?
    My final point is simple. The anxiety that is sometimes created as a result of the pressures that affect this nation adds to the rate of cancers. There is a link there.
    Mrs. Roe: With the leave of the House, I shall quickly sum up. I thank my hon. Friend the Minister for his remarks and assurances and express my deep gratitude to all the hon. Members who have participated in this important debate on a vital subject.
    In conclusion, I make one important point. There has been a great deal of interest in breast cancer recently, and rightly so. It is a dreadful disease—the third largest cause of death for women in this country. However, I would not like the Committee's recommendations to be seen as relating exclusively to breast canner. I believe that, building on the success of breast screening, a national network of specialist breast units can be established with a national co-ordinator and a quality assurance programme integrated with that of the national health service breast screening programme. I also sincerely hope that that will lead the way for networks of site-specific units for other common cancers.
    Question deferred, pursuant to paragraphs (4) and (5) of Standing Order No. 52 (Consideration of Estimates).

  Class XVI, Vote 1

    Financial Services Regulation
    Motion made, and Question proposed,
    That a sum not exceeding £30,079,000 be granted to Her Majesty out of the Consolidated Fund, on account, for or towards defraying the charges for the year ending on 31st March 1997 for expenditure by Her Majesty's Treasury on economic, financial and related administration, including debt management; payments to certain parliamentary bodies; and certain other services including expenses in connection with Honours and Dignities and a grant in aid to the Private Finance Panel Executive.—[Mrs. Angela Knight.]
    [Relevant documents: The Fourth Report from the Treasury and Civil Service Committee of Session 1993-94 on Retail Financial Services Regulation: An Interim Report (House of Commons Paper No. 236), the Second Report from the Committee of Session 1994-95 on Financial Services Regulation: The Building Society Sector (House of Commons Paper No. 26), the Second Special Report from the Committee, containing the Government's Reply thereto (House of Commons Paper No. 283), the Fifth Report from the Committee of Session 1994-95 on Financial Services Regulation: Self-Regulation at Lloyd's of London (House of Commons Paper No. 187), the Fifth Special Report from the Committee containing the Government's Reply thereto (House of Commons Paper No. 745), the Sixth Report from the Committee of Session 1994-95 on The Regulation of Financial Services in the UK (House of Commons Paper No. 332), the First Special Report from the Treasury Committee of Session 1995-96, containing the Government's Reply thereto (House of Commons Paper No. 98), and the Departmental Report of the Chancellor of the Exchequer's Smaller Departments: The Government's Expenditure Plans 1995-96 to 1997-98 (Cm 2817).]
    7.3 pm
    Sir Thomas Arnold: The Treasury and Civil Service Select Committee is most grateful for the opportunity to debate the regulation of financial services in the United Kingdom. It goes almost without saying that the growth of financial services in our country in recent years has assumed an importance that none of us could have foreseen. The reputation of the City of London—indeed, the reputation of our country—is inextricably bound up with that growth and it is an area of life and an activity about which we can truly say that the eyes of the world are upon us. It is for that reason that the Committee has been especially concerned during a long-running inquiry to consider the issues of transparency and accountability. I shall make some further reference to those principles in my remarks.
    I thank my colleagues on the Committee for their patience and diligence during the two years in which we have been examining the issues. I thank our Clerks for the long hours that they have put in and the many witnesses who have appeared before the Committee. I also thank my hon. Friend the Economic Secretary to the Treasury for her response on behalf of the Government to our report, dated 12 December, which the Committee received just in time for this debate. I shall make further reference to that in a moment.
    I want to give the House something of the flavour of the way in which the Committee carried out its work. We approached the subject in a remarkably non-partisan way

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    and, mostly, with open minds. We listened carefully to the evidence and for the most part reached our conclusions without votes. Clearly, there were some differences of opinion, as one would expect, but they were not generally major ones. The entire proceedings were remarkable for the degree of open-mindedness and fair-mindedness on the whole Committee.
    It is for that reason that I should like to draw the attention of the House to what was arguably the one substantive vote, which took place when we came to debate, discuss and agree the final report. It involved a series of amendments moved by the hon. Member for North Warwickshire (Mr. O'Brien). It raises some important issues that we should consider this evening and with which I propose to deal head on.
    It is perfectly true that there are some differences in emphasis, style and tone between the Government and the Opposition on the regulation of financial services, but I do not believe that they should be exaggerated. There is not an unbridgeable gulf across the Floor of the House on the matter. A degree of consensus is apparent, which is to be welcomed in the national interest. For the reasons that I gave at the start of my speech it can only be in the public interest that the Government and Opposition for the most part find themselves in broad agreement on how to tackle some difficult problems and respond to new opportunities and challenges.
    The amendments moved by the hon. Member for North Warwickshire went further in the direction of proposing that we should replace the present arrangements with a structure that would more closely resemble the American Securities and Exchange Commission. That led to a vote in the Committee. The key sentence in his amendments is to be found in our report on page xliii in amendment 93B, which states:
    "The Committee recommends that the ultimate objective should be for the SROs to be folded into SIB to become serving departments."
    In the event, the amendment was lost because I exercised a casting vote with the Noes.
    The report shows, however, the progress of the argument and the difference between Conservative and Opposition members of the Committee. I do not believe that the difference is serious because, while structure in these matters may be important, what ultimately matters is the quality of regulation. We all agreed that we required good, well-trained and properly motivated and paid regulators and staffs, who would enjoy respect in their profession in the City of London and be regarded throughout the world as thoroughly professional men and women doing an important job. We concluded that the regulators in the new organisations have coped well with the immense changes that have swept across the financial markets and the City of London in recent years, although there have been some trying and testing moments and there will no doubt be more in the future.
    The majority of the Committee did not feel that the time was right to go as far as the hon. Member for North Warwickshire proposed, but we understood perfectly what motivated him, the intellectual argument that he was putting and the manner in which his proposal was put.
    In a fair-minded and positive response to the Select Committee report, the Government have left open for the future many aspects of this debate. At a time of rapid
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    evolution, it is sensible to allow the changes being made to work their way through before deciding on the timing for the changes that the Committee proposes.
    The Select Committee holds the firm view that, henceforth, ministerial responsibility for all aspects of financial regulation and supervision should be concentrated in the Treasury. That view has already provoked a certain amount of controversy. I draw the House's attention to paragraphs 118 and 119 of our report. Paragraph 119 says that we want to encourage
    "HM Treasury to adopt a more interventionist and active role in the co-ordination of financial services supervision and regulation."
    Some commentators immediately fell on the word "interventionist" with an unwarranted zeal. The key word in that paragraph is not "interventionist" but "co-ordination". Evidence that the Committee took revealed that we require better co-ordination and one department of state to build up a core of expertise and understanding of the issues and personalities involved so that, when and where it is necessary to bring people together or, more trenchantly, knock heads together, that can be done with a full and proper understanding and awareness of exactly what is involved. As time went by, we were increasingly uneasy about the division of responsibilities between the Treasury and the Department of Trade and Industry. We felt that the time had come to concentrate resources and activity in the Treasury so that a group of civil servants and their ministerial chief would have an even better grip on current events.
    We attach considerable importance to that proposal. I was encouraged by the tone of my hon. Friend the Economic Secretary's reply because, while she did not give our recommendation a full and firm yes, she certainly did not say no. She drew attention to the Treasury's memorandum of June 1995 to the Committee, which referred to the arguments in favour of such a transfer of responsibilities, and went on to say:
    "However, the recommendation raises wider issues which would need careful consideration before final decisions are taken."
    If time permits this evening, she may care to tell the House exactly what some of those wider issues are.
    The Committee felt that concentrating effort in the Treasury would bring about an improvement in what some quarters clearly regard as either a duplication of effort or an overlapping of functions. The co-ordination to which I referred could thus be better achieved.
    Mr. Nick Hawkins: Does my hon. Friend agree that, despite the valuable work that the Committee has done on this subject, members of the industry are still concerned—I am aware of that concern as deputy chairman of the all-party group on insurance and financial services—that regulation is too often targeted on bureaucratic form filling and not enough on catching criminals who prey on our constituents?
    Sir Thomas Arnold: I shall have something to say about criminals later. I sympathise with what my hon. Friend says. It is important to note that Mr. Andrew Large, for example, of the Securities and Investments Board recently said that he would be in favour of moving, when and where possible, towards reducing bureaucracy and form filling, provided that greater transparency and disclosure by the firms with which he deals can be assured. He believes that a trade-off may prove possible. I welcome that and hope that he will explore the matter further.

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    I shall refer to just one or two specific matters in the report without trying to be exhaustive. I draw the House's attention to paragraphs 60 and 61. The Committee felt that the time had come to review the Financial Services Act 1986 not because we did not believe that the Act was flexible—clearly, it is—but because it may be deficient in some respects. Paragraph 60 says:
    "The problems faced by the regulatory system in dealing with products which do not fall clearly within the remit of one regulator come to the heart of difficulties rooted within the Act itself … The key exclusion from the Act is lending."
    An example of that which probably struck the Committee more than any other was the fact that mortgage choice is not regulated under the Financial Services Act. The Committee took evidence in respect of a difficult problem with home income plans, which caused us a great deal of distress and anxiety. We certainly do not want to see that happen again. It was an unfortunate and, in some ways, deplorable affair, which caused us a great deal of upset. It is for those reasons, again based upon evidence, that we felt that the time had come to look again at the Financial Services Act, and to consider whether it is sufficient to deal with the rapidly changing market.
    That theme is taken up again in paragraph 66 of our report, where we draw attention to the plethora of regulators in the United Kingdom. The evidence from Mr. Sharples of the Securities and Futures Authority was particularly impressive. He said of international regulatory conferences:
    "I have always been embarrassed because we sit round this table and there are two from France, there may be a couple from Germany, three from the United States and usually about ten from Britain: the Bank of England, the Treasury, the SIB, the SFA and so on."
    That is why the Committee concluded:
    "The implication is that regulatory diversity in the UK means that it is unclear who the lead regulator is in a particular area or for a particular institution."
    Such confusion occurs from time to time. We went on to state:
    "This confusion is not conducive to the formation of a coherent international approach, where a clear vision of developments in the market and the appropriate regulatory response is essential."
    When my hon. Friend the Member for Blackpool, South (Mr. Hawkins) intervened, he talked about crooks and other such problems. The collapse of Barings bank took place during the course of the Committee's inquiry. That led us to reflect deeply on the problems of international co-operation and the need to have clear demarcation lines in terms of regulation. Mr. Sharples' evidence was very much in our mind when we considered the collapse of Barings and its consequences.
    The Committee's report went into some detail on the nature of regulation and supervision. I do not propose to rehearse those arguments. In compiling the report, the Committee was concerned to provide not merely opinions but a quarry of useful evidence and advice from distinguished outsiders that could be used in future by the Government, the Opposition and other parties, regulators and the City. I hope that we shall achieve that objective because I am sure that the papers and library of evidence that we have built up will help greatly in that process.
    It is clear that there have been and continue to be some tensions and difficulties between the SIB and the self-regulatory organisations. I do not find that altogether
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    surprising because, over time, the SROs, and the SIB above them, have gradually become more accustomed to using the Financial Services Act, and have therefore enhanced and developed their roles. They have become much more proactive. As Mr. Large put it in paragraph 92 of our report:
    "Yes, the SROs have become stronger frontline regulators and I think we should regard that as a success rather than a failure. It is exactly what we all intended."
    His judgment was and is correct. The SIB has also increased its role in a manner that I welcome.
    I recognise that the tensions between the SIB and the SROs will not disappear overnight, but with patience and the passage of time, and given the hard work taking place now, I am sure that some of those difficulties will be overcome.
    I should like to refer to Barings and the position of the Bank of England in some detail. One reason why the Committee is so keen for the Treasury to take full responsibility for the regulation of financial services in our country is that, in addition to the work on which we spent a great deal of time—all the operations of the Financial Services Act—we recognised that the Bank of England, as the lead supervisor and regulator for the banking industry, and responsible as it is to the Treasury, also, in practice, must have dealings with other financial institutions, some of which are not regulated by the Treasury.
    The Committee has had plenty of difficulties and scandals with which to deal, Barings being the most recent. In the past decade three serious scandals have affected the Bank of England—Johnson Matthey, the Bank of Credit and Commerce International and Barings. Each time, the Committee has been given assurances that lessons had been learnt and that improvements have been made. That information is most welcome, but life does not stand still and in our fast-moving world the pace of events seems to dictate that, sooner or later, another batch of problems and another crooked deal comes to pass and the result is a catastrophe.
    The collapse of Barings was a catastrophe, and most people recognise it as such. As I said in Committee to Mr. George, the Governor of the Bank of England, the Committee is not engaged in a witch hunt against the supervisory staff of the Bank of England—far from it. We recognise the long hours and the hard work that they put in, but we are entitled to question the apparent discrepancy between the report of the Board of Banking Supervision into the collapse of Barings and that which the Committee has now received from the inspectors appointed by the Minister of Finance in Singapore, in which a different tale apparently emerges. For that reason we will want to take further evidence in the new year to try to get to the bottom of what happened.
    We all welcome the review of the Bank's supervisory functions that is now being undertaken by Arthur Andersen. The Minister referred to that report in her reply to the Committee's report. She specifically stated that before committing herself to a further review of the Bank's supervisory functions by the Treasury and the Government, she would want to take into account the report from Arthur Andersen and the Committee's future report into the details surrounding the collapse of Barings.
    As the House knows, the Committee took a great deal of evidence on Lloyd's. I do not propose to dwell too much on it beyond saying that, once again, we were of

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    he opinion that events as they unfolded showed the need for a greater concentration of effort within the Treasury and the need for external regulation. When all is said and done, we were not of the opinion that confidence could be fully restored in Lloyd's by the current regulatory arrangements. I know that there are those in the market who find that irritating, but that is the judgment that we reached on the evidence that we heard, and it continues to be our view.
    We recognise that Lloyd's has gone a long way towards making improvements, and of course we welcome that, but we feel that more needs to be done. It is encouraging that, as far as I know, not one single policy-holder has yet been in the position where the market has refused to pay. On the contrary, Lloyd's has continued to function throughout its difficulties, and I hope that it will be able to trade through them and emerge all the stronger. Precisely for the reasons that I gave at the start of my speech, however, the Committee believes that in the interests of transparency and accountability the market would be strengthened and its reputation enhanced if our proposals were accepted.
    In conclusion, I welcome the support that the Government and other Departments have given the Committee in terms of the expert witnesses from the Government who have appeared before us. I welcome my hon. Friend the Economic Secretary's positive reply to our recommendations. I urge her to take them seriously and not to allow too much time to elapse before putting a number of them into effect. I hope that the Government, the official Opposition and other parties in the House will feel able to move ahead in a way that will command general support.
    7.29 pm
    Mr. Giles Radice: I start by paying tribute to the hon. Member for Hazel Grove (Sir T. Arnold), who chaired the Select Committee in an admirable fashion and produced a report that was broadly agreed—except for our arguments over the relationship between the SIB and the SROs. I thank the hon. Gentleman for his good work and I wish him luck in his continuing chairmanship.
    The Select Committee has played a valuable role. Some of us came to the subject with open minds: in my case, it was an open mind perhaps tinged with ignorance. I have certainly learnt a good deal during our 46 sittings. We took a massive amount of written evidence, which seemed to go on and on; we sometimes felt that it would never end. The Select Committee has given the general public a great opportunity to see what is happening in the City and to argue out the case. It has given the institutions a chance to discuss matters in public and it has given the regulators a chance to argue their own corner; they certainly did a fair amount of that during our sittings.
    We produced a broadly agreed report; there was a difference of emphasis, but the report is extremely useful. It is useful for the Government—I know that there are some differences of emphasis within Government Departments about what should happen and we have been helpful to them on that. The report is useful for Labour because, if after the next general election we should be in
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    government, it will provide a mine of information that was not previously available on which to base our Government policy.
    The City and financial services are of great importance to the economy and to the general public—given how much of our money is managed in the City of London and how many of the products produced by the financial services industry are used by members of the public. It is therefore essential that the general public have confidence in the effectiveness, openness and honesty of the institutions and firms operating in that sector. That is the case for regulation—for having the markets regulated.
    One has to ensure that the regulation does not interfere to such a degree that it piles costs on to firms. But there is a counter-argument which is just as important—I would say more important. Unless the public have confidence in the institutions and firms, we lose out as an economy. The public have been worried about one or two sectors, which has affected business. There is a strong case for good, high-quality regulation.
    Ms Diane Abbott: Does my hon. Friend agree that another reason for carefully studying financial regulation is that we now have a much wider and less sophisticated consumer base of financial services products than we did a generation ago? Many more people are purchasing mortgages and private pensions—many more unsophisticated people are purchasing financial services products and they therefore need the best and most effective form of regulation that we can provide.
    Mr. Radice: I agree with my hon. Friend, whose keen questioning of witnesses I have always valued. She certainly made that point clearly during our sittings.
    I shall now turn to what I might call the North Warwickshire point. I congratulate my hon. Friend the Member for North Warwickshire (Mr. O'Brien) on his promotion to the Front Bench, which is well deserved. He moved an amendment that was referred to by the hon. Member for Hazel Grove, which represents the nub of the argument between the two sides—inasmuch as there was an argument, this was it.
    We all agreed that there was a problem involving the regulators fighting among themselves—they did so publicly in front of us, so we could hardly avoid drawing that conclusion. There was a problem involving confused responsibilities—some of the witnesses said that. There was a problem about who was responsible for the regulation—a responsibility that has changed over the period. The title SRO is now a misnomer as they are no longer self-regulatory organisations, but have increasingly become—we propose that they should become even more so—organisations containing a majority of public interest members. They are no longer organisations that simply represent the industry professionally—which is, perhaps, how they were originally conceived.
    The SROs have changed and the proposal that the Labour party supports—we turned it over in our minds over a long period and were uncertain about which was the best model—is one where the SROs are, in the words of my hon. Friend's amendment, folded into the SIB. We are not envisaging a massive, bureaucratic organisation—on the contrary, there would be two departments: one responsible for retail and the other responsible for wholesale. Our model would keep some of the best

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    aspects of the SROs such as professional involvement; we need experts who know how the markets work. Such involvement should still be guaranteed, but we would eliminate the unnecessary duplication that occurs at present through the SIB and the SROs. By eliminating duplication, we could reduce costs.
    That structure provides a better model and, through our search for consensus, we made a nod towards the possibility of creating that model. In the full body of the report we said that if the regulators could not come together more effectively than in the past, the case for the model that I have proposed today and that my hon. Friend suggested in Committee will be much stronger. In essence, assuming the general election is 18 months away, the intervening time will provide a good testing period to discover whether the two are moving closer together.
    Mr. Malcolm Bruce: The period is unlikely to be longer.
    Mr. Radice: But the period might be shorter, which is the point that I am making. Those 18 months will provide a good testing period in which people such as my hon. Friend the Member for Edinburgh, Central (Mr. Darling) will be able to test to discover whether the organisations are coming closer together and whether the model proposed in the amendment is the best one. The intervening time will provide a good testing period for the regulators.
    We produced a separate report and investigation on Lloyd's, although we mentioned the subject in the body of the main report. It was a great experience for me and for many of my colleagues who heard the witnesses who appeared in front of us. I think that one must conclude, as the Committee did, that Lloyd's represented a massive self-regulation failure. That is why the Committee was persuaded that there should be an independent external regulator who is answerable to the Treasury. There can be no practical argument against that case. The Government, even in their dying days, should accept that argument—as I hope that any future Labour Government would. It is a helpful and a sensible move that would help to restore the worldwide reputation of Lloyd's, which has taken a considerable battering in the past 10 years.
    My last point refers back to the comments of the hon. Member for Hazel Grove. I have learnt a lot from my service on the Select Committee. I was not a member of the Committee at the time of the collapse of Johnson Matthey, but I chaired the sub-committee that examined the collapse of the Bank of Credit and Commerce International, because the then Chairman, as a chartered accountant, had a vested interest and did not wish to become involved. I examined the BCCI case very carefully and I concluded that it represented a supervision failure on the part of the Bank of England. I was not convinced then that the Bank's supervisory role should be separated from its monetary responsibilities, although we laid down some clear proposals to improve the Bank's supervisory capacity and abilities—some of which it followed and others of which it did not.
    We then saw the collapse of Barings. Most people who considered it objectively would conclude that the Bank of England did not do a very good job supervising Barings. Quite a lot of evidence in the Singapore report—which makes very interesting reading—points to that
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    interpretation. I am not embarking upon a witch-hunt against the Bank of England, but we must have more effective supervision.
    In the report, the Committee asks: is the Bank sufficiently divorced from the culture of the banking industry? Some might say, although I do not believe that it does, that that conflicts with the next question: does the Bank have the necessary expertise to be an effective regulator? One of the problems with Barings and BCCI was that the Bank of England did not know enough about the market that it was supposed to supervise. We have asked those questions, but as yet we have not reached any conclusions about them.
    I have now changed my mind; I have been swayed by experience and by recent events and I am now in favour of a separate body. When the Committee visited Frankfurt, we talked to officials from the Bundesbank who argued very strongly that the bank's reputation as a monetary body was more powerful because it was not responsible for bank supervision. Therefore, if mistakes were made in the supervision area, they would not affect the bank's monetary position. I think that that is quite a strong argument and the Bank of England, which is now trying to develop its role in monetary affairs, should consider it very seriously.
    Ms Abbott: Does my hon. Friend agree that, apart from the points that he mentioned, there are three problems with the Bank of England as a supervisor? First, it is wedded to a hands-off, laissez faire form of supervision. Specifically, it conducts much less on-site examination than the supervisors that we visited in America and in Europe. There is too much stress on the personal character of the people leading the institution as opposed to the detail of checks and balances.
    Secondly, the Bank's perception of its role as supervisor is rather different from the way in which the public perceive it. It believes that its role is to ensure that there is no risk to the system and once it is sure of that, it tends to think that its job is done. However, the ordinary punter in Hackney or North Warwickshire tends to think that the Bank should offer some degree of security to depositors and consumers. Thirdly, the Bank of England cannot be shifted from its belief that it is absolutely the best supervisor in the world.
    Mr. Radice: I congratulate my hon. Friend on that brilliant mini-speech in which she encapsulated her arguments—or perhaps trailed the arguments that she will use on another occasion. She is absolutely correct: they are the proper arguments to deploy.
    I have now come around to the view that bank supervision should be conducted by a separate body. I do not know the Labour party's position in that regard, but the Government continue to support the Bank of England and its view that banking supervision should not be separate. I think that it would be better for the Bank of England, for banking supervision, banks and the general public if we were to make that reform.
    I think that I have spoken quite long enough. This is my last speech in the House as a member of the Select Committee—I had my last hurrah in Committee when the Chancellor appeared before us yesterday. I believe that Select Committees perform good work. The Treasury and Civil Service Select Committee comprises a curious body of men and women who have very different and disparate

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    views on many matters. It is quite remarkable how, more often than not, we manage to produce agreed reports. A key feature of the Select Committees is its power to send for persons and papers; that is what makes Select Committees powerful. Mr. Andrew Man, the brilliant columnist for the Independent—
    Mr. Nigel Forman: Brilliant?
    Mr. Radice: Yes, I think that he is brilliant. He wrote a book entitled "Ruling Britannia", in which he makes the enormous error of playing down the role of Select Committees. He says that interviewers on programmes such as "Newsnight" are much more powerful interrogators than Members of Parliament. That may be so, but they do not have the same powers. They cannot send for the head of the civil service or the Governor of the Bank of England and question them. They cannot call people from Lloyd's to appear before them. Select Committees have an enormous advantage which we must put to good effect because that is what makes our work valuable.
    I wish my Select Committee colleagues—if I can call them that—well in their further deliberations. I hope that their next report about the City and regulation is not quite so long in coming as this one was.
    7.48 pm
    Mr. Douglas French: Under class XVI, vote 1, no fewer than 12 documents are listed on the Order Paper as relevant to this debate. Of those documents, the sixth report of the Treasury and Civil Service Committee is unquestionably the most important.
    The Committee was ably chaired by my hon. Friend the Member for Hazel Grove (Sir T. Arnold), and other hon. Members who are present in the Chamber served on it. I congratulate them on what is undoubtedly an excellent report. It contains a mine of evidence and information and reaches a number of very sound conclusions—although I am not entirely sure that it would serve the purpose of the hon. Member for North Durham (Mr. Radice), who seems to believe that a future Labour Government could use the report as a basis for financial services legislation. I do not think that he will find himself in that position, but were he to do so, I suggest that the matter be viewed in a rather wider historical perspective. He vouchsafed that he learned things when serving on the Committee, and I am sure he did, but I wonder how much attention he paid to the long history of the subject, and in particular, the long history of the retail side.
    The sixth report is the most up to date, but in considering the insurance, savings and investment side of the industry, we must go back to 1982 and 1984, when the Gower report was produced. We have debated the subject almost continuously for more than 10 years, and a number of substantial reports have been published during that time: the Gower report, the Securities and Investments Board report in 1989, the Clucas report in 1992, and Andrew Large's report in 1993. Each was regarded at the time as the report to end all reports, but the debate has continued nevertheless.
    During those 10 years, there has been a significant restructuring of self-regulatory organisations. During a five-year period following the Financial Services Act
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    1986, it was continually said that the Act was not working as well as people had hoped. The Treasury said that such legislation should be given time to "bed down": that was its favourite expression.
    When the "bedding down" period became too long to be credible, we were told that it was not appropriate to embark on new primary legislation, because that would send the prospect of a solution to the perceived problems too far into the future. We have been stuck in a limbo, in which practitioners in particular recognise significant deficiencies in the workings of the Financial Services Act, but there is a difference of opinion on how those deficiencies should be rectified and on whether primary legislation is required.
    Meanwhile, during those 10 years, the poor practitioners have been trying to run their businesses. They have been faced with rule books and practice directions that have changed, and with consultation papers heralding further change; they have been buried under an enormous burden of constantly changing regulation. That is not the sort of environment in which any business—particularly the savings, investment and insurance business—can hope to prosper.
    It is easy to lose sight of the original purpose of the Financial Services Act. I can sum up that purpose in six words, although many volumes have been published that say the same thing: "Sell something suitable and be honest." The attempt to implement that principle, however, has gone seriously wrong. The original intention was laudable, but its execution has backfired and, in some respects, has proved self-defeating.
    The original principle was that the client must have a proper choice of product, accompanied by independent advice that came to be described as "best advice". That is a praiseworthy aim in itself, but major institutions found it impossible to implement. Soon after the Financial Services Act, many institutions with household names endeavoured to offer independent advice and a proper choice from a range of products, but one by one they dropped out.
    The last two big names to provide such a service were the National Westminster bank and the Bradford and Bingley building society; I believe that the Bradford and Bingley is now the last major institution that is still clinging to the principle of offering independent "best advice". The requirement to offer clients that service has been made so difficult to deliver that institutions have abandoned any hope of doing so. Surely that is contrary to the original intention of the Act.
    Another principle was that the client must be given good value. There have been many examples of clients being sold poor-value products. They had been sold life insurance or investment policies whose returns were unreasonably low, or whose surrender values were discounted to a ridiculous extent.
    The worst abuses appear to have been removed at the expense of giving everyone poorer value: the overall costs of compliance, especially in the insurance sector, have become massive. Institutions have huge compliance departments devoting their efforts to ensuring that no rules are broken, and ensuring that lengthy procedures are followed. They impose spot checks themselves, or try to ensure that, when such checks are imposed by visiting regulators, they measure up to requirements.

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    That has used up a large amount of management time in an unproductive way. Moreover, the process has been so costly that products offered by some institutions have become considerably less competitive than they would otherwise have been. After all, the costs of compliance—the costs of the whole regulatory regime—are ultimately borne by the investor or the policy holder: they will come out of his premium or deposit. That is the part of his money that is not invested, which means that investment returns are worse than they would otherwise have been.
    That is one reason why business has become so much more difficult to write for the retail sector and the life insurance companies. The institutional compliance costs have become greater than is justified, which detracts from the potential value of the product.
    Ms Abbott: The Select Committee has already heard all this heart-rending stuff about the tremendous burden of regulation. Before Opposition Members all break down in tears, will the hon. Gentleman answer a question? If the problem is too much regulation rather than too little, why have we seen the horrendous scandal of mis-selling of personal pensions, home income plans and endowment mortgages?
    Mr. French: I do not mean to sound heart-rending; I think that I am reflecting the views of the management of most leading life insurance companies. Such companies can make an important contribution to our economic life and our business potential overseas.
    The hon. Lady picked on three examples. It is true that the industry has failed in those cases, but they do not remotely represent the way in which the industry conducts its business generally. It is possible to identify shortcomings in almost any industry, and the hon. Lady has identified three important shortcomings, but in the context of all the business undertaken by those institutions, even those shortcomings—heart-rending though they may be—are comparatively insignificant.
    Another problem that has made life difficult for institutions endeavouring to sell life insurance and investment-related products in particular is the fact-find, which has to be completed whenever a sale is made. I have seen fact-finds that extend to 72 pages. They are for products which may be fairly but not over complex. That is a very thorough approach, but I suggest that it is, in fact, overkill, that it is too thorough. It makes it extremely difficult, even for an honest and straightforward salesman, to clinch a deal that might otherwise have been clinched comparatively easily.
    In addition, the sheer drudgery of going through a lengthy fact-find makes the prospective client suspicious and inclined to defer purchasing a policy which he might be well advised to have. It is an example of the best being the enemy of the good, when, in order to ensure that not a single tiny detail is missed, one must go through a procedure that results in the business not being done at all. That is a disadvantage, of course, to the institution, but also to the prospective policy holder.
    Mr. Forman: Is my hon. Friend sure that all the excessive questionnaires, which I have also seen, are attributable to regulatory obligations? I have a feeling that many of the questionnaires, which no ordinary person is under a legal obligation to answer, exist to create market
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    opportunities for conglomerate financial institutions which wish to pass information from one part of their activity to another in order to open up other avenues of business.
    Mr. French: My hon. Friend is absolutely right, but there is also a third explanation. More questions may be asked than are strictly necessary, but only in order to ensure that the approach is very cautious, and that nothing that a compliance officer or regulator might subsequently say should have been noticed was not noticed. That is what I describe as overkill.
    Too many questions are asked and too many answers are received, so that the financial institutions are not caught out. If they are caught out, the penalties are severe. I accept, however, my hon. Friend's point that additional information may be thought highly desirable for marketing purposes by other parts of the same institution.
    Let me give the House another example of where I think that the regulatory regime is too burdensome. Friendly societies are in the business of selling comparatively small policies, what they call small ticket business involving premiums of, say, £10 or £20 a month. Even though the salesman is selling such a small policy, the full panoply of the regulatory regime falls on him, and the enormous cost of regulation is reflected in the value, or otherwise, of the policies that he sells.
    That is acceptable if the policies involve a large premium, or if the sellers are institutions offering a broad range of policies. In the latter case, the regulatory cost of the £10-a-month policies can be shared with that of the £500-a-month policies, so that the cost is evened out. Friendly societies, however, do not have large-premium business. That means that there is a conflict between the cost of regulation within the premiums that they are charging and the Government's present policy, which is to give a tax concession to people paying premiums to friendly societies on qualifying policies. I have evidence that the value of the tax concession in respect of such a policy can be outweighed by the cost of the regulatory regime. That is a ridiculous situation that requires attention.
    One of the consequences of the difficulty that the industry has had in following the requisite sales procedures correctly has been the generation of new forms of what are known as direct products. Very often, they are execution-only products, and no advice is offered. Of course, they are attractive, because it is the giving of advice and the responsibility involved in giving it that are expensive. If products can be sold separately from the giving of advice, they are likely to be easier to sell and, if correctly sold, might represent better value for the purchaser.
    With such products, however, there is absolutely nothing to prevent the client from buying something wholly unsuitable. That means that they escape the regulatory regime completely, and ever more products are being sold in that way to avoid the heavy regulatory regime that would otherwise apply.
    It has become easier to sell such products thanks to the recent improvements in technology. Much has become possible because the telephone and computer can work swiftly together to clinch sales. I believe that the problem will become greater as financial services come to be offered on the Internet—indeed, this is already happening—and become available on a cross-border

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    basis. There is likely to be a proliferation of direct, no-advice, execution-only products, which escape the regulatory regime altogether even though they may be wholly unsuitable for the person buying them.
    I have a high regard for the people currently responsible for the Personal Investment Authority and the Securities and Investments Board. They are undoubtedly trying to act in the best possible interests of the consumer and the industry. Ultimately, there must be common ground between those two interests. However, an independent financial adviser, who is a member of the PIA, came to my surgery last week. He brought with him the PIA rule book, the PIA fact-find—or his version based on what the PIA requires—and copies of 16 consultative documents issued by the PIA or the SIB in the past 18 months or so. He felt that he should have a passing interest in all of them, or that he should at least have read them. He said that, if he were an employee of Allied Dunbar, for example, he would have a department to read the documents for him and advise him when he needed to take notice of them in the daily conduct of his business.
    However, as he is an IFA heading a company of only eight people, the responsibility fell on him. He said that there were hundreds or even thousands of IFAs across the country in exactly the same position. One day in every fortnight—or 10 per cent. of his business time—had to be devoted to reading the latest material from the self-regulatory organisation. He suggested that the situation was out of control.
    That might be the right way to deal with people proposing deliberately to be dishonest or negligent in their selling of products, but it should not be necessary for that person, as an honest and competent intermediary, to devote 10 per cent. of his time to reading the rule book instead of going out and getting the business on which his living depends. I have considerable sympathy with him. The current rule books are too complex, burdensome and detailed. They work on the assumption—a wrong assumption—that people in the industry will always do a bad job.
    In general, all this is doing great damage to the insurance and personal investment industry. It does not help customers, except in a small number of extreme cases. Meanwhile, it is increasing costs and reducing the value of the products on offer. It also renders those products less sophisticated and less tailor-made to the client—the exact opposite of the original intention behind the Financial Services Act.
    Moreover, insurance and investment institutions are being prevented from enjoying the sound, thriving domestic market which is so essential if they are to play their proper part in European and world markets. We have a wonderful basis on which to build; this country's institutions are highly sophisticated. They have a marvellous opportunity to do well in overseas markets, but the current domestic market is proving so difficult that what could be golden opportunities are being lost.
    I agree with a number, although not all, of the proposals in the Select Committee report. I agree with my hon. Friend the Member for Hazel Grove about placing all responsibility for the retail and wholesale markets with the Treasury.
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    I should like a greater recognition of the fact that we should not throw the doctrine of caveat emptor out of the window. It seems only right to invest some responsibility in the client for what he is doing. At present, all responsibility seems removed from him. That is why I was pleased to read the recent speech by Andrew Large on this very point. He said:
    "Over time we may see a shift away from the bulk of the customers placing trust and reliance in financial advisers towards a situation where more of them take full responsibility for their own investment decisions."
    That is the direction towards which we should strive. I am certain that there should be less prescription. The benefits of a product, and its price, should be clearly presented; but there must not be so many prescriptive rules governing the exact procedures involved in selling the products.
    I also believe that regulation requires some cost benefit content. It is all too easy for self-regulatory organisations to make regulations without regard to their cost to the industry. Whenever new regulations are made, some assessment of the likely accompanying costs should be a requirement. I also agree with the proposal to rationalise the SROs. The proposal most often made—one SRO for the retail and another for the wholesalside—commands a great deal of support.
    Lastly, we need a vigorous enforcement mechanism and effective redress for people when things go seriously wrong. At present, a huge amount of effort is devoted to ensuring that nothing goes wrong in any sale of any retail product. If something small goes wrong, someone may suffer a small amount of damage. The greater effort should therefore be directed to vigorous enforcement when there have been serious departures from what should happen.
    All this leads me to my final conclusion. I have great respect for the Minister who is to answer the debate. I believe I am right in saying that her view is that what we want can be achieved through existing legislation. I, on the other hand, have reached the view that primary legislation will be necessary to reach our objectives.
    8.14 pm
    Mr. Malcolm Bruce: I was waiting with bated breath to see what conclusion the hon. Member for Gloucester (Mr. French) would arrive at. When it came, it was not quite what I had been expecting. Most of his speech seemed to be against regulation, so his ending surprised us.
    I defer in these matters to other members of the Select Committee, because I joined it only when most of the work had been done and most of the evidence had been taken. I am therefore not as apprised of the issues as is the hon. Member for North Durham (Mr. Radice). Nevertheless, we all have an interest in them.
    Whatever our differences of view, no one is looking for heavier regulation. What we want is more effective regulation, to engender confidence at home and abroad. The reputation of the City of London and of our financial services and banking regulations is an important factor in the confidence of the home market and of our European and international markets.
    The crises and scandals can have an international impact—the banking scandals are a case in point; the impact of the Lloyd's crisis might be termed intermediate;

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    then there are the domestic scandals which also affect the reputation of the City. That is why we must all be concerned to find a regulatory framework which is effective, confidence-inspiring and good for the City's reputation, at home and abroad.
    The hon. Member for Gloucester rightly said that there is a balance to be struck: regulation must not stifle the flexibility and innovation which are characteristic of British financial service institutions and which render them world class. There is a huge cultural difference between our system and the conservative and cautious approach in Germany to the financial instruments of saving and investment. The approach in the United Kingdom is far more creative and flexible; in general, that means that every pound invested through the City of London will produce a better return. Of course, more risks are involved too.
    All this points to the conclusion that we need to get the balance right. We cannot afford another catastrophe at home or abroad, because the City's reputation is already tarnished. If we fail to ensure that the system can anticipate scandals, we will face a problem that could have long-term repercussions for the City's earnings.
    It is widely argued now that the self-regulatory organisations are wrongly described. They have become much more formalised; there has been some blurring at the edges, resulting in confusion. There is a clear need to tidy up that confusion. Indeed, some of the problems to which the hon. Member for Gloucester referred may have arisen precisely because of confusion over where the boundaries lie. That could be reduced if the lines of communication were made clearer.
    Here, too, a fine balance needs to be struck between practitioners and consumers. Perhaps there should be an over-arching umbrella under which a bilateral division is set up. Even if boards are set up with a slight majority of practitioners, to ensure that regulations are based on knowledge of the internal workings of the market, the effective chair should perhaps be drawn from the consumer side so as to provide balance and confidence.
    I certainly do not intend to launch a broadside against the Minister's response to the report, which I have managed to read through quickly. I would say, however, that there was a wait-and-see flavour to her response, suggesting that she is not quite as apprised as we are of the need for definitive action in all these areas. The hon. Member for North Durham pointed out that, after three major banking scandals, it is becoming difficult to believe that the Bank of England is the right institution to regulate banking.
    The hon. Gentleman's point about the Bundesbank and the benefit that the Bank of England would have from that separation is powerful. That must be worthy of consideration as we move towards a more independent central bank. The Minister knows perfectly well that I and my party favour an operationally independent central bank and believe in any case that, if we move towards monetary union, we will have to take that step. That being the case, it seems better that the Bank concentrates on its role as monetary regulator, and divests itself of the role of banking regulator.
    Having given that as my personal opinion, I say to the Minister that I am not sure about her waiting for the Bank's report—which is presumably the Arthur Andersen report—and the Select Committee report. Although all of
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    us on that Committee are grateful for the role and status that she gives the Committee, and in spite of the very important points made by the hon. Member for North Durham about the power of Committees to take evidence, the Government should commission their own clearly independent inquiry, at the very least—if they do not accept the argument—to determine whether the separation would be beneficial.
    This is no pejorative criticism of Arthur Andersen or any consultant at all, but when the Bank of England commissions a firm of consultants to look into something independently, the consultants tend to work out who the purchaser is and what kind of reply they might be looking for; it is only human nature. The report therefore inevitably falls into the category of being commissioned by the Bank of England.
    It is not entirely clear what the Bank of England's view is. Eddie George says that he is relaxed, and is not fighting hard either way. That being the case, the Government therefore would not cause any particular difficulties at the Bank if they were to commission an independent report.
    The members of the Committee who worked on the report throughout produced a great deal of detail, a great deal of information and a clear indication that specific steps need to be taken to move the matter forward. It may be that the Minister wishes to leave the decision on action to the next Government. That might be the right thing to do.
    But there are one or two useful things that the Minister could do to show that the Government were in control and recognised that we were moving in the right direction. The industry itself has been moving in the right direction, but pretty well everyone one talks to acknowledges that we need a reformed legislative framework. Indeed, there is potential cross-party agreement on the desirability of that.
    In his opening remarks, the Chairman of the Committee, the hon. Member for Hazel Grove (Sir T. Arnold), rightly stressed that, whatever the differences among members of the Committee, the strength of common ground is much more important. In that sense, there is plenty that the Government could do to move the matter forward without opening up party differences. I would certainly regret it if the issue became in any way a party political battleground, because the working of these markets, both at home and abroad, is a vital component of the British economy and must be got right.
    The system is not working correctly at the moment, and nobody really believes it is. We are exposed, due to the question mark over the reputation of our financial services institutions and the City of London, and we have a duty to ourselves, as well as to the City's international reputation, to do something about it. The Committee has produced a report that points in the right direction, and I urge the Minister to take it up with slightly more enthusiasm than her response suggests she intends to do.
    8.23 pm
    Mr. Nigel Forman: I declare my interests as they are registered in the Register of Members' Interests. They are in some way relevant to the debate in the sense that they give me a background in these matters that is slightly more knowledgeable than it

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    would otherwise be. From that point of view, there is no harm in Members of Parliament having openly declared outside interests.
    I congratulate my hon. Friend the Member for Hazel Grove (Sir T. Arnold) not only on the compelling way in which he spoke, but on the highly competent way in which he chaired our Committee through this long set of hearings. He managed with his usual subtlety to produce a well-balanced report and one with which, broadly speaking, I found myself in agreement, even thoughalas—I was not able to be present at the final voting sessions on the report.
    It is good that the House had the opportunity to listen to my hon. Friend the Member for Gloucester (Mr. French). Although what he said might not have been flavour of the month with all Opposition Members, it needed to be said. There is another point of view on these matters, which was well reflected in my hon. Friend's speech. I commend him for the way in which he put his case.
    I remind the House of the vital importance of financial services to our national economy—both now and in the future—especially services in the City of London, which is almost a form of shorthand for them. I hasten to add, though, that many other financial centres are growing where offices and so on cost less, which are very important. I think of Edinburgh, Brighton, Cheltenham and a number of other places.
    First, it is perhaps not widely known that financial services represent about one sixth of our national economy—and the proportion is growing all the time. Secondly, the City of London itself has an unduly—or perhaps I should say very strikingly—high proportion of global equity and bond trading, of foreign exchange transactions, of derivatives trading, of marine, life and non-life insurance and of fund management. That is not just because we are the widely acknowledged leader in our time zone, as it is called, but, I can say quite dogmatically, it is because in certain specialty areas there is no financial centre in the world to match the City of London. Long may that remain. It is a vital national interest that it should be so.
    I would like to comment on the collapse of Barings, which has been mentioned in the debate. With the wisdom of 20-20 hindsight, the collapse of Barings may not have been such a bad thing; it was sad, but salutary. I say that because it was large enough to trigger a major review and shake-up of the necessary controls, especially on derivatives and rocket scientists' instruments, but it was small enough not to threaten a systemic collapse either of our financial system or of the global financial system. From that point of view, again with 20-20 hindsight, it has served not only our interests but the wider interests rather well.
    Looking at some of the main issues in our report, I should like to say a word or two about first principles. First, the protection of investors and consumers is obviously the main concern of the House of Commons in financial services, and rightly so. Indeed, it was the Committee's main concern. But that protection and general safeguarding of their interests should not be taken to the extent, as my hon. Friend the Member for Gloucester has already said, of removing all need for caveat emptor and of removing all moral hazards. After
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    all, people are expected to be grown up in most other areas of their life, so why should financial services be a notable exception?
    Secondly, it would not be wise for us to over-burden the sector with excessive rules and costs, as my hon. Friend the Member for Gloucester also said. Thirdly, one must recall that all jurisdictions these days—tax and regulatory—are in fact involved in a form of international global competition. It was not always like that, but it is now, in a world of footloose capital and mobile individuals. As a result of that, we have to take account, as must the Treasury, of the danger of driving lucrative and lawful business offshore if our regulatory and tax climate were to become too intrusive.
    Fourthly, if we move, broadly speaking, from trust to contract, which is a brief soundbite describing what has been going on over the past 10 years, we must recognise that we are being driven in a more and more legalistic direction. One has only to look across the water to the United States to see the downside of that if it is allowed to be taken too far. Therefore, while protection of the consumer and the investor must be absolutely important, it must be balanced by the rather commonsense factors that I have just mentioned.
    My second theme is the structure of regulation, with which the Committee's report is largely concerned. I remind the House, not that it needs to be reminded, that the current structure traces itself back to the free concordat between Lord Parkinson—who is now in another place but who was then Secretary of State for Trade and Industry—and Sir Nicholas Goodison.
    The deal was done essentially in relation to the stock exchange. It eventually found its way through to the Financial Services Act 1986. It gave birth to what the hon. Member for North Durham (Mr. Radice) has described as self-regulation. That is a misnomer in today's world. More appropriate would be the term practitioner-influenced regulation. That is what it is and that is what it should be. In other words, it is regulation by consent based upon what is practicable.
    We may write as many elaborate rule books as we like—there were some signs that the Securities and Investments Board would do that in the days of Sir Kenneth Berrill—but that merely creates extra problems rather than new solutions. I am delighted that the trend of the SIB was pulled back to some extent by subsequent chairmen. Mr. Large is doing an excellent job and getting the balance about right.
    It is worth saying that good regulation is in the market interests of the regulated. That is important. In responsible and reputable markets such as those based in London and other cities in the United Kingdom, practitioners see good regulation as being in their market interests. They want a good regulatory structure within which to operate and they wish to abide by its regulations. Enormously adverse publicity is attracted to any financial institution if it gets things wrong or steps on the wrong side of the line. That demonstrates the strength of my argument.
    Paragraph 26 of the Government's response takes up the argument whether there are too many layers of regulation. In the Select Committee, Opposition Members, especially the hon. Member for North Warwickshire (Mr. O'Brien), expressed the view that there are. They argued that rather than having the departmental level, the SIB level and the self-regulatory

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    organisation level, we should have two rather than three. It was suggested that at the departmental level the Treasury should have sole responsibility.
    I quibble only about the desire of the hon. Member for North Warwickshire and his hon. Friends to make three layers into two. On reflection, I think that the three-layer system is satisfactory and, by international standards, is working pretty well. I agree, however, with Opposition Members in their keenness to give the Treasury sole and therefore lead responsibility within Whitehall for arrangements at departmental level. That makes good sense. I happen to know that the Treasury is becoming increasingly geared up for that purpose and is attracting many well-qualified people to its ranks to undertake supervisory functions in so far as they belong in a Department of Government.
    If I had to justify the continuation of three layers, which is what I favour, I would argue that the top layer, the Treasury, would provide the necessary public accountability through Ministers to the House for the framework of law and for the broad lines within which the structure operates. The middle layer, which is represented by the SIB, would be there to regulate the regulators. That is the way in which Mr. Large describes his main role. The bottom layer, in a hands-on and day-to-day way, would administer regulation and ensure that wherever possible it was done with the intelligent and active co-operation of the regulated.
    As I have said, the regulated recognise that it is in their interests to co-operate and to be on the right side of any line. On my quick reading of the Government's response, which I accept took place only this evening, I was glad to read the concluding sentence in paragraph 35, which states:
    "The Government considers that the review mentioned by the Committee would be destabilising for an industry which has already seen considerable change and therefore is urging all regulatory bodies to ensure that such a review will not be necessary."
    I agree with that sentiment and I hope that my hon. Friend the Minister will adhere to it.
    I support the idea of the Treasury being given the sole and consequently key departmental role in the three-layer structure, but I would like to hear from my hon. Friend the Minister, when she replies, a little more about the Government's thinking. As set out in the Government's response, it is delphic. Paragraph 26 reads that the Government are quite warm to the idea of having the Treasury as the main Department involved, but adds that
    "wider issues … will need careful consideration".
    The House deserves to know what some of those wider issues are. It is unfortunate if the Minister has to be coy. If that is the position, we might have to pursue the matter elsewhere at a higher level.
    The present structure is, broadly, working rather well and needs to be left well alone. We should not spend all our time in this place pulling up plants to see how the roots are getting on. There is no decisive advantage in fundamental change. That is the point that I made in some of the friendly arguments that I had with the hon. Member for North Warwickshire when in Select Committee. We used to cross swords on the issue.
    The corollary of what I have just said is that the House and legislators generally should remain constantly vigilant about these matters and not be complacent. Our financial services attract some of the brightest and most energetic
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    in our society, but some of them may be tempted from time to time to transgress. It is vital that we as the supreme regulatory body in the United Kingdom be alert to any danger of mis-selling or malpractice. Aside from that, I do not want to end on a negative note. Let us celebrate the contribution that is made by financial services to the economy, jobs, inward investment and everything else. I hope that hon. Members on both sides of the House will recognise that contribution.
    8.36 pm
    Mr. Matthew Carrington: First, I declare my interests as in the Register of Members' Interests. I declare also an interest that I understand is still not registrable, which is that my wife works at the London international financial futures exchange. I understand, as I have said, that it is not a registrable interest but it is something that the House will wish to know before I continue.
    It has been a good debate because we have seen what is often apparent in the Select Committee on the Treasury and Civil Service—that is, a measure of strong agreement throughout all parties. I welcome that consensus.
    We are not discussing a barnstorming report. Nevertheless, it is a worthy report. It highlights important issues that need to be considered but are not capable of instantaneous solution. Nor should they be capable of it.
    I do not propose to go through the details contained in the report. That has been done already, and extremely capably, by my hon. Friend the Member for Hazel Grove (Sir T. Arnold), who chairs so excellently the Select Committee, and by the hon. Member for North Durham (Mr. Radice), whose presence in Committee we shall greatly miss. We are pleased that he has transformed himself to another Select Committee—or that is what we understand—but we shall miss his wise advice and contributions to our meetings.
    The report is important because we have highlighted the purpose of regulation. I say that because the purpose of regulation is not immediately obvious. Indeed, the purpose is difficult to define. Regulation varies enormously depending on what we are trying to regulate. One of the most obvious purposes of regulation is to stop wrongdoing. It is clear that the purpose of regulators is to catch crooks. That is the easy part of understanding regulation.
    With regard to protection of the public, as we heard from my hon. Friend the Member for Gloucester (Mr. French), protecting the public is a complex business. If we try to protect them in the wholesale markets it is necessary to have a certain form of regulation, whereas in the retail market a very different form of regulation is needed. It is possible to say that the Financial Services Act 1986 has worked quite well in wholesale regulation, but perhaps less well in the retail sector. Not only have enormous burdens been put on to the practitioners in the retail sector, but there have been significant failures of regulation, such as the mis-selling of products, which has already been described.
    Perhaps one of the major purposes of the regulator, and possibly therefore of regulation, is really to create transparency. It is to enable people to exercise the right of caveat emptor when they are buying a product, and to know what they are buying. Frequently, perhaps

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    especially in the retail sector—although I know from experience that it happens in the wholesale sector too—the same product can be packaged so as to make it hard for someone who wishes to buy it to determine from whom to buy it, to the best advantage of the purchaser.
    Of course, another purpose of regulation is to avoid crashes, such as that of Barings. Another theme that emerged from our report is that regulation in the banking sector has not been very effective in stopping crashes, and I shall ask in a moment whether that could be improved.
    However, the real purpose of regulation is more than all those things: it is to instil confidence in the markets that are being regulated. That was one of the criticisms that came out of our separate report on Lloyd's. The question was not whether Lloyd's is being properly regulated now—although there is no doubt that it was not properly regulated in the past. In some ways, whether it is properly regulated now is not the issue. The issue is whether the people who might place their insurance business with Lloyd's believe that it is being properly regulated. That is the strongest argument for an external rather than an internal regulator for Lloyd's. The question is purely one of confidence.
    We have heard about the conflict between the Securities and Investments Board and the self-regulatory organisations. That has led some members of the Select Committee, as well as other hon. Members who are not members of the Committee, to conclude that the SIB should absorb the SROs. In some respects that is a perfectly rational argument, and it is not an argument with a great political element to it. The decision should be made on grounds of practicality and functionality.
    Rather as was suggested by my hon. Friend the Member for Carshalton and Wallington (Mr. Forman), I suspect that a system of dynamic conflict between the SIB and the SROs is rather helpful, in that it answers the age-old question: who will regulate the regulator? A regulator's ability to become complacent—and, one must say, corrupt—is substantial. Although none of our regulators has shown any sign of being corrupt, there are examples from all round the world of regulators who have become extremely corrupt, and one does not have to look far, either geographically or back in history, to find them.
    There is a great need for somebody who monitors regulators very closely and who, indeed, has a certain amount of conflict over turf with them, so as to ensure that there is a degree of competition.
    That leads me on to the role of the Bank of England, especially in the light of the collapses of Barings, of the Bank of Credit and Commerce International and of Johnson Matthey. The question is whether the Bank of England is capable of supervising banks. I do not think that that is an especially political argument. Again, it comes down to practicality, and I would summarise it in a straightforward way.
    Do we believe that there is an overlap between the role of the Bank of England, first in its regulation of monetary policy and its management of the Government debt—an important, traditional and large function of the Bank—and secondly, in its ability to regulate the money markets and to provide banking supervision?
    Is there a transfer of knowledge between the Bank's management of the various money markets? In other words, by being an active member and participant in the
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    markets, is the Bank of England able to understand problems arising in the other participants in those markets? Can it see problems arising before they become serious, and can it judge the ability of the management with which it is dealing in other institutions? Can that then feed into its appraisal of those banks and its decisions as to whether they are being properly run?
    None of that can possibly be a substitute for the Bank's ability to go in and do a proper audit and inspection of the banks, but it may have access to additional information to which a separate regulator would not have access. If that overlap exists, it is important that it be retained. And the question whether the overlap exists in practice is capable of being determined by a proper inquiry. Possibly the Arthur Andersen inquiry will establish that.
    If the answer is that there is a benefit, the Bank of England should retain its supervision of banks. If not, the answer is probably that it should lose that supervisory role. However, I add one caveat, because my experience, having in the long-distant past worked for an American bank that was regulated by the American banking system, is that that system of regulation, which is separate from the American equivalent of the Bank of England, was very bureaucratic and intense, yet not very effective, as has been shown by the number of bank collapses throughout the United States.
    Before anyone suggests that a change in the way in which we supervise the banks would, by definition, produce a better system of supervision, we should look hard at the experience in other countries, because it may not necessarily support that conclusion.
    The Committee is still in the throes of examining the causes and consequences of the Barings collapse. One of the questions that we need to consider closely is whether the Bank of England can co-operate properly with banking supervisors in other financial centres. One of the big difficulties that we as a Parliament face, and which the Bank of England will also face, is the growing problem of competitive regulation between financial centres.
    There is a large and increasing incentive for regulators in evolving financial centres to provide cheaper and less stringent regulation than we provide in London. The consequence of that would be either that the quality of our supervision would decline, or that London would lose business. I am sure that the Select Committee will return to that subject, and I look forward to debates on the Floor of the House on the future of banking supervision in general.
    8.48 pm
    Mr. Alistair Darling: I start by acknowledging the work of the Treasury and Civil Service Select Committee, which has been praised by every hon. Member who has spoken—[HON. MEMBERS: "They are all on it."] Surely there must be at least one Member present, other than me, who is not a member of that Select Committee. I can praise the Committee genuinely, as I am not a member. In particular, I can acknowledge the way in which the hon. Member for Hazel Grove (Sir T. Arnold) introduced the Committee's report.
    I also pay tribute to my hon. Friend the Member for North Durham (Mr. Radice). It would be wrong for me not to acknowledge his work on the present report and on previous reports of the Select Committee. I have always

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    found his contributions helpful, and equally helpful is the advice that he is prepared to give his colleagues behind the scenes. Of course, my hon. Friend is not leaving us altogether; as is common knowledge, he is moving to another Committee. I am sure that the House will acknowledge his work.
    I would like also to acknowledge the work of my hon. Friend the Member for North Warwickshire (Mr. O'Brien), to whom reference was made in just about every speech tonight. My hon. Friend did so well on the Select Committee that he was put in the Opposition's Treasury Front-Bench team and, as a result, cannot say anything tonight. He is here with us tonight, and I can assure the House that he has been saying plenty sotto voce during the debate.
    Most hon. Members who have spoken have made the point that the financial services industry is of immense importance to this country. It has been said that that was not fully appreciated 10 to 15 years ago. The industry—broadly defined—employs nearly 2.5 million people, and not just in the City of London. Clearly, the City of London—as the hon. Member for Carshalton and Wallington (Mr. Forman) said—is one of the three main financial centres in the world, and it is unquestionably the major centre in our time zone.
    Although we are mindful of the competition from other European centres, London does have a pre-eminent status, and the critical mass is here. It is home to more than 500 foreign banks, and many other institutions from outside the United Kingdom are in London because of its importance in the world. It is very important that no Government should do anything that would discourage people from coming to London and remaining in London. We should do everything that we can to continue to encourage London and to build its reputation. This is an industry we are very good at operating and, for that reason, it must be encouraged.
    The industry is not just based in London. Many towns and cities in this country depend on the industry for employment. I represent the constituency of Edinburgh, Central, and Scotland is now Europe's fourth-largest financial centre in terms of funds under management. The industry is important to this country not only as a wealth creator but as a service provider. My hon. Friend the Member for Hackney, North and Stoke Newington (Ms Abbott) made a series of interventions which, taken together, amounted to a speech. She made the valid point that, unlike in the past, most people now have some contact with the industry in terms of buying products.
    I shall return later to the question of regulation of the retail end of the market. It is crucial that people have the confidence to deal with the retail end of the market, which will grow more important as more and more people want to make provision for themselves and their families. We want to promote saving and we want to encourage people to save. Therefore, it is important that people are able to make informed choices between products and between product advisers. It is important that there should be as much diversity as possible, so people can get the sort of products they need.
    Clearly our discussion tonight has been about the nature of regulation and what it is meant to achieve. One of the objects of regulation must be to ensure that the public interest is met, whereby people who want to buy long-term products are put in the position where it is more
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    likely that they will buy the right sort of product, and less likely that they will make a mistake. I use those words advisedly, because I should acknowledge at the outset that it is not possible to have a foolproof system of regulation. Nobody is asking for that, and arguing for such a system would waste everyone's time.
    I am conscious of the fact that there is some regulatory competition, and the hon. Member for Fulham (Mr. Carrington) referred to that point. I do not think that we should get carried away about it; I do not think that we are quite at the stage where people will leave because of it. However, there are worrying signs. I worry when I see people involved in retail sales setting up bases in Luxembourg and Dublin because of the advantageous regimes there. One wonders how, in the single market, some regimes are able to offer all the encouragement that is not apparently available in this country. The Minister might dwell on that point when she comes to reply.
    One of the things that the Government can do in Europe, and I shall return to this point shortly, is to ensure that our institutions are playing on the much-clichéd level playing field.
    Mr. Forman: The hon. Gentleman will notice that I paid tribute to Edinburgh in my speech. He should avoid the danger of being complacent about the point of regulatory competition. Evidence has come before the Committee, and we know from other sources, that large multinational conglomerate financial institutions are placing an increasing part of their firepower—if I can call it that—in countries such as India, where there are educated and competent people who are well able to do the job, and communist China. Over the horizon lies the prospect of Shanghai becoming a booming financial centre in its own right. In addition, these places do not recognise western versions of intellectual property.
    Mr. Darling: I appreciate what the hon. Gentleman says, but I made the point that we should not get carried away. There are those—I have not heard any of them tonight—who argue that we should have a minimal level of regulation to compete. I intend to return to this point shortly, and I am conscious of the fact that there are problems which must be dealt with. As the hon. Gentleman will find out, the thrust of what I have to say is that it is necessary not just to simplify the structure of regulation but to revisit the nature of regulation because this country is going down the wrong path and a change of direction is necessary. That has been the Opposition's belief for some time. I caution those who would say that the best thing would be to try to compete with those countries where there is no regulation whatsoever. No hon. Member from either side of the House has said that, but the view exists and it must be dealt with.
    The Select Committee covered a wide range of subjects, and I shall touch on one or two before I return directly to the Bank of England and to the SIB regime which have dominated our discussion tonight. I agree in general terms with much of what the Select Committee had to say, but I wish to look at a couple of points briefly.
    The first is the question of Lloyd's. We agree that external regulations are overdue and should be put in place. That view is not unique to the Opposition—Conservative Members have mentioned it, and the council of Lloyd's happens to take that view. I hate to inject a note of controversy into the debate, but it is matter of

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    regret that the former President of the Board of Trade—now the Deputy Prime Minister and First Secretary, or whatever he calls himself—told the council of Lloyd's that the Government would not sanction legislation. The reason for that was perfectly obvious to Opposition Members—it was because of the political embarrassment in which the Government would have found themselves. At least 49 Conservative Members are members of Lloyd's, many of whom are in the Cabinet.
    The House may remember the last time we debated financial services in the House. The Opposition started off with a general review of what was happening, but very soon two Conservative Members—one who had lost a lot of money and one who was a member of the council of Lloyd's—started saying things to each other in such a way that outsiders would have found it hard to believe that they were in the same party. I can well understand why the President—as he then was—took the view that the Government wanted nothing to do with the matter.
    It is intolerable that the interests of Lloyd's and of the reputation of the insurance market in Britain should take second place to the political embarrassment that the Government would endure if they introduced a further Lloyd's Bill to allow for external regulation. We believe that external regulation is essential and at an appropriate opportunity we intend to give Lloyd's that assistance. That would also help Lloyd's to make the recovery on which it is embarking. I acknowledge, as other hon. Members have done, the work that Lloyd's has been doing.
    Mr. John Butterfill: I am a little puzzled by the point that the hon. Gentleman makes. Before I go further, I remind the House of my declared interest in the matter. The hon. Gentleman admits clearly that the council of Lloyd's would be happy to co-operate with any legislation that might be introduced. How might that be embarrassing to the Government?
    Mr. Darling: The council of Lloyd's was keen for legislation to be introduced. I cannot remember whether the hon. Gentleman was present for the earlier discussion on Lloyd's. He will know that whether it is a matter of controversy to his colleagues depends on where they stand on Lloyd's. It was good of the hon. Gentleman to declare his interest. He might also declare that he has just walked into the Chamber. He may have missed the introduction to the debate.
    A section of the report dealt with plea bargaining and enforcement. I caution hon. Members to be careful before institutionalising plea bargaining as a way of resolving problems in the City. The Securities and Exchange Commission in the United States uses it, but its modus operandi is different. 1 argue strongly against buying from the United States an off-the-shelf solution to our problems. That is not to denigrate the SEC. It is an American creation for the American market. I declare an interest as a Scots lawyer. I am wary of importing American legal methods into this country unless there is good justification for doing so.
    I want the Select Committee to do some more work to find out whether the regulatory system could be used to better effect in matters such as insider dealing. The law on
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    insider dealing has fallen into disrepute. There has been a handful of prosecutions in the past 10 years. A number of recent cases, to which I shall not refer, for the sake of brevity, have led the public to believe that the law on insider dealing is not enforced. People who work in the industry will tell anyone who cares to listen that there needs to be a change. Perhaps the regulatory system could help; the criminal law is not working. If there were an effective deterrent, instances of insider dealing would be greatly reduced because people would believe that they had every chance of being caught.
    No one is asking for more regulation. I have a great deal of sympathy with the hon. Member for Carshalton and Wallington. We do not need more regulation. We are talking about effective regulation and fewer rules that work. Four rules that work are worth far more than 400 that do not. I agree with the hon. Member for Gordon (Mr. Bruce) that we have an innovative industry. That is why we and everyone else have shied away from notions of supervision or authorisation of products. That would be stifling and unnecessary.
    Talking of fewer rules that work, let me return to Europe. Many companies and institutions now face the problem that, in addition to having to deal with the United Kingdom domestic regulatory regime, they have to deal with an increasing number of regulations from Europe as well as meet their international obligations. As we have heard, most institutions in Britain trade throughout the world. Compliance officers frequently have to deal with three or four different regimes. Usually, none of them tries to do the same thing. They are often contradictory and do not always fully equate with the business practice of the company.
    One of the reasons why we argue that we ought to be at the heart of Europe is that it is high time that our influence was felt more when regulations are formulated. The European Commission has a tendency to regulate for an industry that does not exist as such across Europe. The structure of the United Kingdom industry is very different from that of the industry in Germany, Italy and other European countries. It is important that the British Government fight for British companies and argue the British corner and that we do not allow ourselves to be lumbered with regulations that impose a burden on our country.
    The United Kingdom industry has a sophistication that is not always reflected elsewhere. Our companies and institutions will be at a competitive disadvantage if they face rules and regulations that were never designed for the United Kingdom industry. I am not a Euro-sceptic, despite what I have just said, but the Government could do more.
    The Committee examined regulation and supervision. I should like to make a few remarks that I hope will encourage the Committee to look further at certain issues. Such work provides a useful basis for policy formulation by the Government, I hope, and certainly by the Opposition.
    When we pose the question, "What are supervision and regulation?", we cannot make the distinction often enough that the City of London—our financial services industry—is many different industries, so a generalised approach to regulation simply will not do. We have to distinguish between supervisory requirements, where we are guarding against systemic failure, and regulation, where we are

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    dealing with the conduct of business. We must recognise the difference between what is required at the wholesale end of the market, where we are dealing with relations between institutions and the doctrine of caveat emptor can apply more or less unencumbered, and what is required at the retail end, where we are dealing far more with customer protection and that doctrine must apply.
    The object of the regulatory system must be geared not only to protecting members of the public from unscrupulous selling techniques or bad advice but to enabling them to make a genuine and informed choice. I would slightly temper the doctrine of caveat emptor because the object of the regulatory system, particularly at the retail end, must be to put buyer and seller on an equal footing.
    I must say a word or to about supervision and prudential supervision with particular reference to the banks. On Barings, suffice it to say that we know that it collapsed because of incompetent management. How can a bank shift its entire capital out of the country with no one asking what is going wrong? How could Sir Peter Baring, within a couple of days of the collapse, say that it was all the work of a competitor? I cannot imagine that any competitor could do as much as the company managed to do to itself.
    The people who run Barings now should think long and hard about paying bonuses to those who were involved in the collapse of the bank. It sends the wrong signals around the world. Just as we in the House have to think about how others see us, so corporate institutions must do the same. Barings might like to reflect on that and a bit of humility would not go amiss.
    The real lessons that we have to learn are for the Bank of England and other regulators. As has been said, Barings was the third major failure with which the Bank had to contend. The Board of Banking Supervision produced a good, but damning, report that should cause us some concern. We were particularly struck by the board's observation in paragraph 14.35 of that report:
    "We believe the Bank should explore ways of increasing its understanding of the non-banking businesses (particularly financial services businesses) undertaken by those banking groups for which it is responsible".
    Again, one has to wonder how the Bank of England did not understand the broader financial services activities of the banks that it regulated, given that so much of their profits now come from that source. I trust that the Bank is now doing so.
    I also find it difficult to understand why the Governor of the Bank of England is so defensive towards those of us who have been critical. Our criticism has in many ways been remarkably restrained. In the summer preceding the collapse of Barings, the Governor said that there was no need to worry about derivatives because, "These chaps know what they are doing." Those of us outside and who, in whatever capacity, are charged with deciding what supervisory regimes are appropriate are bound to have regard to what the Governor said then and what happened subsequently when Barings collapsed.
    The culture of the Bank of England and its attitude to supervision need to change. A new executive director responsible for regulation is to be appointed next week. The Select Committee might want to have that individual before it at an early stage, to find out whether there will be a change of emphasis.
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    We have heard references to the Arthur Andersen report. Perhaps the Minister will take the opportunity to deal with two matters. I strongly believe that any system is only as good as the people who employ it—that is crucial in supervision and regulation. We have spent some considerable time exploring opinion on the matter and it has been put to me that one of the problems in the Bank of England might be the difficulty that it has in attracting and keeping appropriately qualified staff. There may be pay and status implications. Clearly, the Bank can do a certain amount by finding resources from within itself, in the obvious way, but the Government may have to face up to the fact that it may be necessary to consider the pay structure and the structure of the Bank itself, if it is to deal with an increasingly complex area. Leaving aside whether the Bank has to do so in the long term, in the short term the Government may have to face up to that problem.
    There has been much talk about the structure of the regulatory system and it would be appropriate to say a word or two about our view of whether the Bank of England should be the supervisory body. For the sake of completeness, for those who follow our proceedings outside the House, the Financial Times published an interview with me on 10 November which is wholly accurate and which summarises the state of our thinking.
    I made several points in that interview. The argument about whether the Bank of England should be the supervisor is finely balanced and we have not reached a conclusion. There are arguments for and against making a change. For making a change is the fact that major structural exchanges are taking place in the industry. The neat distinctions between banks, building societies and insurance companies are disappearing. Indeed, the Building Societies Commission may find that the number of bodies for which it is responsible will diminish quite sharply. It is expected that most major building societies will have moved over to the Bank of England's supervision because of conversion in the fairly near future.
    In the light of that, one is bound to ask whether it is appropriate to have the Bank of England, the Building Societies Commission, the DTI and others all concerned with prudential supervision. My guess is that, in the not-too-distant future, it will be appropriate, for that reason if for no other, to revisit the issue of who should be responsible for prudential supervision. At the moment, it is historical accident as to whether an institution comes under the supervision of the Bank of England, the Building Societies Commission or the DTI.
    The second argument was touched upon by my hon. Friend the Member for North Durham. If there was a body such as, for example, a banking commission, fully focused on regulation, it might improve the quality of regulation. That was raised by Lord Justice Bingham in the Bank of Credit and Commerce International report and is a model followed in other parts of the world. I accept that there is an argument for that. Against that, the most important feature of supervision and regulation is the quality of people involved; changing, or removing to another office, the brass plate does not resolve the problem. At the end of the day, it is the people who matter.
    Despite what hon. Members have said about the reputation of the Bank of England, it still enjoys a formidable reputation and can still attract staff because of its status. More important, it is recognised to have a formidable reputation around the world. We should be

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    careful about lightly interfering with it until the case is made for change. The argument is finely balanced and we are keeping it under review. We certainly do not want to throw out the good work that has been done by, say, the Building Societies Commission.
    Hon. Members referred to the need for international co-operation. One thing that will have caused hon. Members some concern is that when the Singapore authorities published their report into the collapse of Barings, one got the impression that there was an attempt to knock the ball out of the Singapore court, preferably into the court of the Bank of England. In the Barings collapse, there was an obvious dispute between Simex in Singapore and the Osaka authorities in Japan. Such regulatory competition is thoroughly unhelpful.
    Hon. Members have said that they are depressed about the turf war between regulators in this country. More worrying, in some ways, is the turf war that results when markets, and therefore regulators, are in competition. The Government need to take the lead because it is Governments who operate in that area.
    The Securities and Investments Board met its international counterparts earlier this year. The concluding document was entitled the "Windsor declaration"—strangely enough, because the meeting took place in Windsor. Such co-operation is essential. I agree with what was said about the need to have a lead regulator in the case of each institution. Again, the BCCI case highlighted that need. The hon. Member for Hazel Grove made the point that, in international terms, having one regulator is important. That was supported by Christopher Sharples—who did good work at the Securities and Futures Authority before he moved on—in his evidence to the Select Committee. That again points to the desirability of having one regulator of international standing.
    I want to consider the SIB regime, which has been the subject of much discussion tonight. There are two parts to the matter. One involves structure, the other the nature of regulation. The structure needs to be changed as the present system is cumbersome and full of duplication. The view that it needs to be simplified commands increasing support within the industry.
    We propose to make the SIB directly responsible for the regime broadly covered by the 1986 Act. We do not want to create a Securities and Exchange Commission and we shall not create a bureaucracy. I do not want an organisation run by lawyers. I can say that because I am a lawyer and I know what happens when organisations are run by lawyers. We no longer need a distinction between SROs and the SIB, as that is expensive. One can see the difficulties with pension transfers, for example, on which both the SIB and the Personal Investment Authority make parallel rules.
    Under our system, the SIB would still have practitioner input and two separate operating divisions, broadly along the lines of the Securities and Futures Authority and the Investment Management Regulatory Organisation on the one hand and the PIA on the other. I stress that we want to build on what we have and avoid traumatic disruption. The change that we suggest is radical but incremental, and it would be welcomed. I see no reason why the recognised
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    exchanges—LIFFE, the stock exchange, Tradepoint, and so on—should not continue, following the American maxim, "If it ain't broke, don't fix it."
    I agree with what the Select Committee said about self-regulation: let us end it. It might cause the Home Secretary some embarrassment as he introduced the 1986 Act, although embarrassment does not seem to put the Home Secretary up or down so we should not worry too much about that. Self-regulation is a misnomer. The present system is rooted in statute. The problem with self-regulation is the public's perception that trade interest dominates, which is extremely damaging.
    Mr. Butterfill: Will the hon. Gentleman give way?
    Mr. Darling: No, I shall not give way as I want to give the Minister time to reply. I am not being unfair to the hon. Gentleman, as he has not been present for the debate.
    The regulatory system has gone completely wrong. The Government are mistaken to think that, by working with the industry and hoping that something will turn up, the position will improve. A radical rethink to this country's approach is required, particularly at the retail end of the market.
    As the hon. Member for Gloucester (Mr. French) said, the costs are substantial. The other day, I spoke to a large institution, which reckoned that some 5 per cent. of the cost of selling a product arose because of compliance. Given that it takes some six hours to sell a pension policy, one must wonder whether we are going down the right road. I asked a life assurance office to try to sell me a policy to demonstrate the difficulties. After an hour, I was bored and fed up. I wanted to hear no more about the financial services industry or pensions, and we had not even begun to discuss the product. We were still struggling with how much we spent on groceries each week. I am bound to ask whether that is how to sell a pension. I wanted to know about the product; what happened if I gave it up too early; how much I would receive; what expectations were reasonable.
    I often visit institutions where the compliance department is growing faster than the marketing department. That cannot be right. Whenever I attend meetings or lunches, I notice that the compliance officer is always in attendance. I do not know whether that is to watch what the directors say to me or whether it reflects the compliance officer's growing importance. I make those points to show that compliance is getting out of hand. I would tolerate that if the public were happy with it and felt that it was a price that people had to pay. But neither the public nor the industry has confidence in the system, which is why I believe that radical change is necessary.
    The system is also irrational. For example, personal equity plans, which are widely sold, have no disclosure requirement on management fees, whereas the sale of pensions and other savings products is regulated and subject to disclosure. I agree with the Select Committee's comments in paragraph 60 about the inclusion of lending within the purview of the Financial Services Act. That is extremely important, and mortgages are a case in point. The selling of a mortgage is often the starting point of the sale of many other products, which is why in the 1980s institutions thought that it was a good idea to buy estate agencies. They thought that if they could collar people at the start, they could sell them everything under the sun.

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    It so happens that many estate agencies are now on the market, if anyone is looking for one. The selling of mortgages is not regulated, whereas everything else that follows from it is regulated—that cannot be right.
    Many institutions are going for execution-only sales, not because that is necessarily what the customer wants, but to avoid the burden of compliance. The entire market is being distorted by a regulatory system that does not work. On a serious note, I have already mentioned that 2.5 million people are employed in the industry and it is an open secret that there will be job losses in the next year or so—perhaps a great many. One of the drivers of job losses is the compliance cost. If we can lift the burden of compliance, some individuals may keep their jobs. We should take that option extremely seriously.
    I believe fundamentally that the approach to compliance, in particular the advice by box ticking, is misconceived and wrong. If the late Robert Maxwell had still been with us, he would have ticked every single box that was ever thrust in front of him. Nick Leeson completed compliance forms. In neither case did that stop what eventually happened.
    A problem with the self-regulators is that they are becoming increasingly defensive and are producing more rules and regulations to protect their own position. The approach to compliance through box ticking must come to an end. Instead, one should concentrate on education and training. One of the best protections for a lawyer or a doctor is their own professional qualification. They know that if they do anything wrong they will be struck off.
    The answer to many of the problems in the financial services industry is to concentrate on education and training, and, having done that, to trust the individual. We will always have problems somewhere, because it is impossible to have a foolproof system, but we should opt for a system based on education and training. We will not get the necessary change unless there is a change in the structure and culture of regulation. Many people look to a Government to give a lead.
    We must also look at the role of management. It was management as much as unscrupulous salesmen who sold the personal pensions. It is management that insists on selling targets and which sometimes has a commission structure that makes mis-selling more likely than not. The nature of regulation has not been concentrated on nearly enough and it is something that the Select Committee might like to consider.
    The consensus is that the present system is not working and that primary legislation is needed to change it. This is an extremely light Session of Parliament. I understand the Minister's difficulty, because she has been given an instruction from above that the only legislation that the Government will contemplate is that which puts what they call "clear blue water" between them and us. The result is that we have one vote a week. Many people outside who depend on the industry for their livelihood and members of the public who want to use that industry will wonder why the Government are not legislating when such a political and industrial consensus exists about the direction in which we should go.
    I must ask the Minister, how many more reports and failures will there be before we get the Government to act? I do not accept the Government's wait-and-see approach, and their hope that something will turn up. That is not the correct approach. Radical change is needed.
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    Even if legislation were passed now, the lead time between that and improvements being made would be about three years. We cannot wait much longer. I hope that the Minister will accept the urgency of the situation and will announce tonight that the Government accept that changes are needed. It would be a great pity for the industry if it had to wait for a change of Government to get the change in regulation and supervision that most of us would like to see.
    9.23 pm
    The Economic Secretary to the Treasury (Mrs. Angela Knight): This has been a particularly useful debate. I congratulate my hon. Friend the Member for Hazel Grove (Sir T. Arnold) on introducing it. I notice that he said that the Select Committee's report provides a quarry of useful evidence for the future. The hon. Member for North Durham (Mr. Radice) said that the report provides a mine of information. Clearly the consensus in the Committee runs to the phrases used in the House. I should also like to take the opportunity to congratulate the hon. Member for North Durham on his last hurrah. I hope that he enjoys his spell on the Public Service Select Committee as much as he has enjoyed his time on the Treasury and Civil Service Select Committee.
    Before answering the specific points raised in the debate, I should like to comment on the financial services industry of the United Kingdom. London, Tokyo and New York are the three largest financial centres in the world. In Europe, Edinburgh is the fourth-largest centre after London, Frankfurt and Paris.
    Therefore, while we are here today to discuss financial regulation, we must all remember that we have a fine success story and a thriving industry about which we should all be proud and positive. It would not be so if our regulation were too harsh or if our regulation were too light. We would not have as many foreign banks as we do; we would not have £666 billion under fund management; we would not have the largest and liveliest futures and options market in the United Kingdom if it were not an attractive and effective place in which to operate.
    We also have in the City of London a foreign exchange market that is 50 per cent. larger than that of anywhere else, a domestic equity market that is three times the size of Paris or Frankfurt and the greatest concentration of insurers, pension funds and foreign bankers in the world. That good success story does not make me either complacent or blind to glitches or unaware of the need to look to the future, but it means that criticism of our existing system should be balanced, as should be calls for change. The essential combination, as my hon. Friend the Member for Fulham (Mr. Carrington) said, is to have a regulatory system that catches and deals with fraudsters quickly, protects investors and ensures quality professional standards while avoiding a bind that is so tight that the average man, woman or company finds it difficult to operate within it.
    My hon. Friend the Member for Hazel Grove raised a number of issues, the first of which was his concern that regulators need properly motivated staff. I agree: it is a professional industry and professional regulators are required. The movement from the industry into regulation and out again, as part of a career projection, is happening. That means that new blood from the industry, well versed

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    in the clever tricks of the trade, is coming into regulation. That process will benefit not just regulation but the industry as a whole.
    Many hon. Members have mentioned the structure of regulation. There is more than one view on it in the House and, more to the point, there is more than one view from those who work in the industry. I agree that there are problems that must be tackled, but I question the call for structural change. First, as soon as open season was declared on the regulatory structure, it would divide both the industry and the regulators between those who wanted change and those who wanted to stick with the status quo. This summer we saw some skirmishes in that sphere, which gave us a flavour of what would happen if the proposal were implemented.
    Secondly, having made a proposal, there would be a period of consultation, followed by a period of debate, followed by a period of implementation and then, no doubt, there would ultimately be a compromise. If we were lucky, we might achieve something better, but who is to say that that would happen? We would certainly get something different. If, having put the industry through a period in which it was split between those who wanted change and those who wanted to remain with the status quo and having taken the proposal through the House and achieved a compromise, we then told the industry to implement the proposal, the consequence would be change, which would bring a cost to the industry.
    If we wanted to introduce structural change, we would tell the industry that there would be a period of uncertainty for two to three years as the new system was sorted out—and all that just when the existing system was bedding down and making more effective use of the flexibility at its disposal.
    Mr. Butterfill: I am grateful to my hon. Friend for giving way as, contrary to the impression given by the hon. Member for Edinburgh, Central (Mr. Darling), the miracles of modern science have allowed me to follow the debate from my office while dealing with the work imposed on me by my private Member's Bill, which will be to the great benefit of his constituents.
    Does my hon. Friend agree that the problems in the industry exist primarily in the retail and personal sectors and that self-regulation in the wholesale and professional sectors remains almost entirely satisfactory? To impose further change on the retail sector now, when it is just getting over the trauma of the establishment of the Personal Investment Authority, which we should have had in the first place, would impose unnecessary burdens on the industry as a whole.
    Mrs. Knight: My hon. Friend is quite correct, and that is the point that I was trying to make. I thank him for casting light on the issue, in the same way as he does on our days and our nights. My mission with regard to the Financial Services Act 1986 is to ensure that the current system is working well. The Select Committee report refers to its strengths, and it points particularly to its flexibility. We shall draw on those strengths to make regulation truly effective.
    The hon. Member for Gordon (Mr. Bruce) said that the structure of the boards should be examined further. He proposed that the chairmen of the boards of the
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    self-regulatory organisations should be drawn from the consumer side—I hope that I have not misinterpreted him and that he will not need to set me straight. The composition of boards formed the substance of his point and I agree with comments in that regard.
    I also agree that the term "self-regulatory organisation" is a misnomer and I concur that "practitioner-influenced regulation" is a better description. Although I agree with much of the substance of the report, I am concerned about the review that is proposed in paragraph 93. I believe that such a review would prove destabilising for an industry that has already seen considerable change.
    Mention was made of home income plans. That issue has caused considerable distress and many investors have received assistance. Prior to the introduction of the FSA, investors had to take legal action with little chance of recouping their losses and I realise that many people face residual debt. We are urging all lenders to look sympathetically on anyone in that position, as I understand that several are doing already. Immediately before the debate began I had extensive discussions with the Building Societies Commission about the matter. We discussed involving building societies in home income plans and voluntarily submitting their cases to the building society ombudsman.
    I turn now to paragraph 118 and the way in which the Select Committee has encouraged the Treasury to adopt a more interventionist and active role in the co-ordination of financial services supervision and regulation. I am sorry that my reply to that suggestion was considered delphic. I said that the recommendation raises wider issues that will need careful consideration before final decisions are taken. There are wider issues involved if we are considering bringing all regulation under one Department. For example, we must consider the implications for other Government Departments and for interacting areas of policy. In answering the Select Committee, I clearly indicated Treasury inclinations in that area.
    Mr. Forman: As far as I know, there is only one other Government Department that could create an obstacle. Can we not talk some sense into the Department of Trade and Industry and give responsibility to the Treasury?
    Mrs. Knight: I thank my hon. Friend for that comment; I am sure that the DTI will heed his words.
    Several hon. Members referred to Lloyd's. My hon. Friend the Member for Chichester (Mr. Nelson), the Minister for Trade, sends his apologies for not being present for the debate this evening. He suspected that the subject of Lloyd's would come up, but he was unable to be here as he had to address a meeting in Nottingham. I have been asked to convey his apologies to the House and to assure hon. Members that he will take up and answer any points raised on the issue.
    Lloyd's wrote a letter to hon. Members prior to the debate, in which it says:
    "Lloyd's remains committed to achieving the successful implementation of its plans for reconstruction and renewal".
    Lloyd's must clearly undertake that task if it is to resolve its problems. The letter continues:
    "it is not where regulation is done that is important, but how well it is carried out".
    Whatever our views on Lloyd's may be, I think that we would all agree with that. Let me remind the House, however, that we have agreed on the need for a

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    fundamental review of the regulatory regime for Lloyd's that would consider the options of continuing self-regulation and independent external regulation. That review may well not start before mid-1997, as Lloyd's is seeking to resolve various complex problems.
    My hon. Friend the Member for Gloucester (Mr. French) made some pertinent points about the retail side, citing a number of reports. I agree with him that there is a need for stability, and that all who work in the sector are strongly opposed to change. I rather liked my hon. Friend's succinct encapsulation of the original purpose of the Financial Services Act in six words: "Sell something suitable and be honest."
    During the past few months, I have spent a good deal of time listening to people in the financial services industry. We must work with them to ensure that any unnecessary burdens are removed. That is why I support the regulators' efforts to implement the strategy contained in the 1993 Large review, and, in particular, the emphasis on supervision and enforcement. That must be delivered more efficiently to provide proper investment protection.
    I am concerned by what my hon. Friend the Member for Gloucester said about the length of the fact-finding procedure. It need not be over-burdensome. Like my hon. Friend the Member for Carshalton and Wallington (Mr. Forman), I suspect that part of the reason for the long-windedness of the form is that those who drew it up wanted considerably more information than was actually required.
    Attention was drawn to the need to ensure that friendly societies are not over-regulated. The Personal Investment Authority is currently considering the decisions reached by a committee that it set up to examine friendly society regulation. As the committee was chaired by the chairman of a friendly society, I am sure that its conclusions will be relevant and positive. The PIA has announced that the training and competence of home service agents will be examined, and proposes the establishment of a new qualification known as the home service planning certificate, which should ease the burden on those who sell on behalf of friendly societies.
    We must not forget the invaluable role of independent financial advisers. The high streets in our towns and villages invariably contain an office or shop with a sign saying, "Car, house and other insurance, pensions and financial advice". Those offices are run by men and women who have often learnt their skills in the nearby office of a well-known insurance company, or have been trained in a bank. They are as important to the local community as the butcher, the solicitor, the accountant and the supermarket: they provide general insurance services, and help people to plan for the future. The need for those independent advisers has never been greater; the requirement for individuals to take control of their financial future is obvious.
    When we discuss regulation and the future of financial services, we should bear in mind the real need to avoid sweeping statements and generalities. We should remember who we are talking about and what we want them to achieve. No system will ever be perfect, but successful regulation of the retail sector can be achieved through training and competence requirements, disclosure and a lighter touch. We need a less prescriptive regime than the present one. This is the so-called disclosure dividend, of which so much has been said; now, much must be made of it. The regulators and the industry are well aware of my views.
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    The laws of caveat emptor apply to a considerable extent, so those who buy investment policies must themselves be trained. They need to know what they are asking for and what questions to ask, and they need to understand the replies.
    Mr. Darling: The Minister speaks of the need to train those who buy investment policies—the public. How does she propose to train the public?
    Mrs. Knight: There are a considerable number of ways in which we can do it. The first would be to talk about precisely what it is that an investor should be asking. When an individual has decided that he is going to buy a second-hand car, for example, he goes to the car showroom—possibly to four or five car showrooms—and looks under the bonnet, gets in the car, and takes it out for a drive on the road. If he is not confident about his knowledge of the vehicle, he will get a friend to come and have a look. If he is still not sure, he will get the Automobile Association to look it over. Only then will he will spend his money.
    The same responsibility for one's actions has to be taken if one purchases a pension—a sphere of which neither we nor the individuals involved have taken sufficient cognisance.
    Mr. Darling: The hon. Lady surely must accept that there is a substantial difference between buying a second-hand car and buying a pension. The whole point of the regulatory regime is to ensure that the buyer and the seller are put on as equal a footing as possible. The way to ensure that is to concentrate on the training, competence and professionalism of those who sell pensions. The hon. Lady's comparison, frankly, will make many members of the public wonder about the Government's attitude. I think that she should clarify what she has said.
    Mrs. Knight: The hon. Gentleman's comment is really a bit too much. Individuals must take responsibility for their actions; they must ask questions. It is true that a car is a tangible entity and a financial service is not. There are obvious differences, but that does not mean that individuals can ignore the responsibility that they have themselves to ask questions about the product that they are buying, whether it is a financial service or something else.
    The regulatory regime is there to assist the individual and ensure that there is training and competence for the salesman. I do not think that it is right and proper to say that an individual does not have to take any responsibility for his action in the sphere of financial services. He must have the same responsibility as in other spheres.
    Mrs. Carrington: I agree entirely with my hon. Friend. Information must be provided so that one financial product can be compared to another by an individual who does not have specialist knowledge or training. We are talking about regulation to ensure that the industry provides products that are easily comparable by someone who is not a specialist.
    Mrs. Knight: My hon. Friend is correct, and that is what disclosure is all about. Disclosure provides individuals with knowledge about what they are buying, which was not previously the case. I say again that each individual has a responsibility to ask questions and think about what he is buying. The Government also have the responsibility to

    1193
    ensure that there is a working regulatory framework and the other features that have been mentioned by hon. Members. I thank my hon. Friend for his comments and hope that he agrees with what I have said.
    I also hope that when the hon. Member for Edinburgh, Central (Mr. Darling) leaves the Chamber, he will think through some of the points that have been made because I think that his comment went a little bit far—perhaps it was on purpose. We are talking about people, companies, independent financial advisers and people's futures.
    My hon. Friend the Member for Carshalton and Wallington made the point that capital is footloose and that countries are in competition around the world in financial services, as they are in other spheres. He asked what was being done to ensure that this country takes due cognisance of that fact in its regulatory process. I assure him that we are promoting the competitiveness of the financial services industry in the United Kingdom. We are ensuring that it is in a fit state to respond to the ever-increasing pace of developments in products and techniques, and we are keeping a careful watch on the burdens that our own regulatory system may impose so that the right balance is struck between encouraging innovation and maintaining proper protection for the investor.
    I take issue with the point that the hon. Member for Edinburgh, Central made about whether the Government were doing enough to fight Britain's corner in Europe.I can assure him that we are, and in a robust manner. We are arguing in the European Union for an approach to financial regulation that enhances Europe's strengths vis-à-vis the rest of the world, and for an approach that does not tie down too tightly the United Kingdom, which has specialities in this field that other European countries lack. I hope that the hon. Member for Edinburgh, Central will remember that when he takes up this matter again.
    We are also fighting to obtain maximum access for our firms in overseas markets, either as part of multilateral negotiations or through bilateral efforts—and by looking at some products. It is quite correct that competition has come from Luxembourg, to name but one country; part of our response to such competition comes in the form of new products, of which open-ended investment companies are an example.
    Barings has been mentioned several times in the debate. My hon. Friend the Member for Hazel Grove highlighted the differences, as he saw them, between the Board of Banking Supervision report and the report of the Singapore authorities. I assure him that the two reports come to the same general conclusion, however. The Singapore report may come to firmer conclusions about the motives of certain senior managers, but it is important to remember that the BOBS report did not have access to much of the evidence in Singapore. Both reports have been extremely useful.
    Much has been said today and for several months about the Barings collapse. The episode carried serious messages for management in every financial institution around the world. Even those—there were many—who said that it could not possibly happen to them put investigations in hand just to be on the safe side. If there is a silver lining to the whole affair, it is that the entire international financial system is likely to be somewhat more secure as a result.
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    There are important messages for regulators and supervisors as well. The Governor of the Bank of England has welcomed the 17 recommendations for the Bank in the Board of Banking Supervision's report. The Bank will respond to the board by the end of the year on its implementation of the recommendations, and the Governor expects to send a copy to the Treasury and Civil Service Select Committee once it has been presented to the board.
    Arthur Andersen has been appointed to review the way in which the Bank approaches supervision. The report should be completed by next April. The Treasury and Civil Service Select Committee has asked the Treasury to conduct its own review of the role of the Bank as prudential supervisor of banks. With the Arthur Andersen review under way, however, and with the report by the SFA due shortly, together with the Select Committee's decision to undertake its own inquiry into Barings, it makes more sense for the Government to await those findings before deciding whether yet another report is required. A further report before the first report has been completed strikes me as slightly silly; waiting for those reports seems rather more sensible.
    The clear message to those who regulate as well as to those who manage financial institutions is that in a fast-moving and changing market the need to be up to date with precisely what is happening and its possible consequences is paramount.
    International co-operation has been highlighted in the debate. With the globalisation of business, international solutions are required. We take that very seriously. The United Kingdom is in the forefront of efforts to strengthen co-operation. We have negotiated a memorandum of understanding with several countries. The United Kingdom is an active member of the International Organisation for Securities Commissions and of the Basle banking group. In the summer we hosted a conference at Windsor, to which the regulators of futures and options exchanges from 16 countries were invited. They all jointly issued a declaration on the protection of customers' positions, funds, assets, default procedures and co-operation in emergencies. I can assure the House that we take our responsibilities seriously and pursue them actively.
    I end by thanking the Committee for its constructive and helpful report. Although I cannot pretend to agree with every word of it, I do agree with much of it. It is an excellent effort to move forward with the debate on the regulation of financial services.
    Question deferred, pursuant to paragraph (3) of Standing Order No. 52 (Consideration of estimates).

BUSINESS OF THE HOUSE
Ordered,
That at the sitting on Tuesday 19th December, the Speaker shall—

(i) put the Questions necessary to dispose of proceedings on the Motion in the name of the Prime Minister relating to Fisheries not later than three hours after their commencement or Seven o'clock, whichever is the later, and Standing Order No.14B (Proceedings under an Act or on European Community Documents) shall not apply;

(ii) put the Questions necessary to dispose of proceedings on the Motion in the name of Mr. Tony Newton relating to Scottish Business not later than one and a half hours after their

1195
commencement, such Questions including those on any amendments to the Motion which she may have selected which may then be moved.—[Mr. Newton.]

HUMBER BRIDGE (DEBTS) BILL
Ordered,
That, in respect of the Humber Bridge (Debts) Bill, notices of Amendments, new Clauses and new Schedules to be moved in Committee may be accepted by the Clerks at the Table before the Bill has been read a second time.—[Mr. Newton.]

EUROPEAN STANDING COMMITTEES
Ordered,
That the unnumbered Explanatory Memorandum submitted by the Ministry of Agriculture, Fisheries and Food on 8th December 1995, relating to fisheries: total allowable catches and quotas for 1996, shall not stand referred to European Standing Committee A.—[Mr. McLoughlin.]
9.48 pm
Sitting suspended.
10 pm
On resuming—
It being Ten o'clock,MR. DEPUTY SPEAKER, pursuant to paragraph (5) of Standing Order No. 52 (Consideration of estimates), put forthwith the deferred Questions necessary to dispose of the proceedings on Vote on Account, 1996-97 (Class XI, Vote 1, and Class XVI, Vote 1).

Class XI, Vote 1
Resolved,
That a sum not exceeding £13,948,653,000 be granted to Her Majesty out of the Consolidated Fund, on account, for or towards defraying the charges for the year ending on 31st March 1997 for expenditure by the Department of Health on or in relation to hospital, community health, mental health, family health and family health service administration services, National Health Service trusts, and on related services.

Class XVI, Vote 1
Resolved,
That a sum not exceeding £30,079,000 be granted to Her Majesty out of the Consolidated Fund, on account, for or towards defraying the charges for the year ending on 31st March 1997 for expenditure by Her Majesty's Treasury on economic, financial and related administration, including debt management; payments to certain parliamentary bodies; and certain other services including expenses in connection with Honours and Dignities and a grant in aid to the Private Finance Panel Executive.
MR. DEPUTY SPEAKER then put the Questions which he was required to put at that hour, pursuant to paragraph ( I) of Standing Order No. 53 (Questions on voting of estimates, &c.).

SUPPLEMENTARY ESTIMATES, 1995-96
Resolved,
That a supplementary sum not exceeding £1,915,196,000 be granted to Her Majesty out of the Consolidated Fund to defray the charges for defence and civil services which will come in course of payment during the year ending on 31st March 1996, as set out in House of Commons Paper No. 4 of Session 1995-96.

ESTIMATES, 1996-97 (VOTE ON ACCOUNT)
Resolved,
That a further sum not exceeding £81,414,396,000 be granted to Her Majesty out of the Consolidated Fund, on account, for or towards defraying the charges for defence and civil services in Classes I to X; Class XI, Votes 2 and 3; Classes XII to XV, Class XVI, Votes 2 to 15; Classes XVII and XVIII; and Classes XVIII, A and XVIII, B for the year ending on 31st March 1997, as set out in House of Commons Papers Nos. 5, 6 and 7 of Session 1995-96.
Bill ordered to be brought in upon the foregoing Resolutions by the Chairman of Ways and Means, the Chancellor of the Exchequer, Mr. William Waldegrave, Mr. David Heathcoat-Amory, Mrs. Angela Knight and Mr. Michael Jack.

CONSOLIDATED FUND BILL
Mr. Michael Jack accordingly presented a Bill to apply certain sums out of the Consolidated Fund to the service of the years ending on 31st March 1996 and 1997: And the same was read the First time; and ordered to be read a Second time on Monday 18 December and to be printed. [Bill 13].

Channel Tunnel Railway Lines
Motion made, and Question proposed, That this House do now adjourn—[Mr. Wells.]
10.2 pm
Sir John Stanley: When I had my previous Adjournment debate on the subject of blight and compensation in relation to channel tunnel trains, I earnestly hoped that it would be my last debate on that subject. I assume that my hon. Friend the Minister took the same view, especially as the debate began at 6.53 in the morning. Unhappily, I am obliged to return to that key issue, because important issues remain unresolved. Indeed, a major new issue has emerged since I brought the subject before the House.
I wish to raise three specific issues. The first is the well-worn topic that I have been addressing for more than four years—the extent to which the provisions of the Land Compensation Act 1973 apply to existing lines to the channel tunnel, on which very major works have taken place to enable them to accommodate both passenger and freight trains.
I have consistently argued that that Act applies to at least some areas of the existing lines, and that interpretation has been endorsed by counsel, Mr. Gregory Stone, on behalf of the local authorities concerned. I believe that it was also endorsed by my right hon. Friend the Chancellor of the Duchy of Lancaster, who was then Minister for Public Transport, because of what he said in response to my Adjournment debate on 13 January 1994. I will not repeat what was said in that debate, apart from quoting again from the letter I received from Bob Horton, the chairman of Railtrack, on 19 September 1994. The chairman took a very different view from that of myself, Gregory Stone and the Minister concerned. Mr. Horton said:
"We could probably debate indefinitely the interpretation of the words that appear in Hansard. Railtrack's position is clear: even if the Minister was accepting on behalf of the Government that the Land Compensation Act 1973 does entitle those living near existing railway lines used by Channel Tunnel traffic to claim compensation (subject to proving diminution in value), Railtrack does not agree with that interpretation of the Act. I am afraid, therefore, that Railtrack will continue to resist these claims".—[Official Report, 15 December 1994; Vol. 251, c. 1292.]
Railtrack's apparent conclusion in September 1994 was that it would resist all claims for injurious affectation compensation under the Land Compensation Act 1973 from properties anywhere along the existing lines to the channel tunnel from Waterloo to Cheriton, and through either the Tonbridge line or the Maidstone East line.
In the ensuing months, it appears that there has been a change in Railtrack's position with a view to its legal responsibilities. Unhappily, Railtrack has been extraordinarily unforthcoming in making public its change of view. The first indication which I picked up that it had changed its view was in the letter I received from my right hon. Friend the Secretary of State for Transport on 24 July this year, in which my right hon. Friend said:
"Railtrack contend that the vast majority of the engineering works carried out on existing lines in Kent do not constitute works of reconstruction, extension or alteration within the meaning of the Act."
The significant phrase in that sentence was "vast majority". If it is the case that Railtrack contends that the vast majority of works do not trigger entitlement to
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compensation, the very clear implication is that Railtrack does now accept that a minority of works at least trigger an entitlement to compensation.
It was because of that clear implication that I wrote back to the Secretary of State for Transport, asking him to obtain from Railtrack a list of the engineering works along the existing lines which Railtrack does accept fall within the meaning of the Act, and therefore trigger an entitlement to compensation.
The reply I received from my right hon. Friend, dated 6 October this year, was both extraordinary and extremely illuminating. My right hon. Friend said:
"You also asked for a list of the works that Railtrack clearly accept as falling within the meaning of the Act. I do not doubt that some of the engineering works that Railtrack have carried out may qualify as eligible works within the meaning of the Act; indeed, I understand that in a limited number of cases the company is considering claims and have instructed surveyors and compensation specialists to advise and negotiate with surveyors representing claimants. My officials asked Railtrack for a list of eligible works, but the company says that, to date, it has not accepted that any of the works cited by claimants qualify for compensation within the meaning of the Act. Therefore it is unable to provide a list. Although I have no power to intervene statutorily in Railtrack's handling of compensation claims, I intend raising this matter personally with Bob Horton at my next regular meeting with him."
I have to say that I found that to be extraordinary. First we have the Cabinet Minister responsible for the matter accepting in that letter that some works do qualify. We have a clear statement from him in that letter that Railtrack also clearly accepts that and has instructed surveyors and compensation specialists to negotiate with surveyors of the claimants, but at the same time, with extraordinary stubbornness, Railtrack is deliberately refusing to supply the list of eligible works that I and my right hon. Friend the Secretary of State for Transport demand.
I consider Railtrack's behaviour evasive, obstructive and well below the level of public accountability that one would expect from a public body such as Railtrack. I believe that its attitude is in breach of the provisions of the citizens charter. One of the kernel points of the charter is that public bodies and authorities should inform individual citizens of their rights. The taxpayers charter clearly states in relation to HM Customs and Excise:
"You are entitled to expect HM Customs and Excise to help you to understand your rights."
I submit that it is equally incumbent on a body such as Railtrack to help people understand their rights to compensation—rights in law, passed by Parliament. On this issue, it is incumbent on Railtrack immediately to make public a list of the eligible works that have been carried out along the existing lines—those works which in its view trigger an entitlement to compensation. My right hon. Friend the Secretary of State has been asking for such a list for months. I have been asking for it for months. It is Railtrack's obligation to disclose the list. I hope that my right hon. Friend will obtain it from Railtrack and make it available to all Members of Parliament for constituencies between Waterloo and Cheriton. I hope that he will make certain that that key information is placed in the public domain.
The second issue that I want to raise is the major blight that is being created by the proposals of the Central Railway Group to create an additional freight line from the midlands to Cheriton. The new scheme is already

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creating substantial blight. Those who consider that their homes are already blighted should exercise considerable care and take professional advice before they accept the proposals put before them by the Central Railway Group under its so-called property protection scheme. The proposals will involve individual householders making a contractual commitment to the company to sell their home to it at an agreed price at some future date.
The group's proposal contains a trap. Payment for those homes will take place only if the scheme goes ahead. It could be years before it is decided whether the scheme will go ahead and the individuals concerned could be left in blighted limbo for many years. They should give careful consideration to an alternative means of removing themselves from that blighted position.
I have received an important letter from my right hon. Friend the Secretary of State dated 13 October 1995, in which he makes it clear that if the Central Railway Group makes an application to him to handle the project under the procedures of the Transport and Works Act 1992, the statutory provisions will take effect from the date of the application. My right hon. Friend's exact words were:
"Assuming an application is made, the statutory blight provisions of the Town and Country Planning Act 1990 take effect from the date of the application."
That is extremely important to those who believe that they may suffer from statutory blight and I want my hon. Friend to deal with the following three questions in his reply.
First, will my hon. Friend confirm that those affected by statutory blight, because of the Central Railway Group's proposal, will be able to serve a blight purchase notice on the company to buy their homes at full, unblighted value from the date of its application for an order under the Transport and Works Act 1992?
Secondly, will my hon. Friend confirm that those affected by statutory blight will also be entitled to obtain from the Central Railway Group the statutory home loss payments that were increased by the Government in 1991?
Thirdly, will my hon. Friend also provide this assurance? If his right hon. Friend the Secretary of State considers that the immediately available financial resources of the Central Railway Group are not sufficient to enable it to discharge its financial obligations to meet blight purchase notices, when the order comes before the House for debate on a Government motion, will he advise the House in the motion to refuse to proceed with the project?
Mr. Mark Wolfson: Does my right hon. Friend agree that, on both the issue of compensation and the key second point about the Central Railway Group, a large number of constituents of a considerable number of hon. Members who might not be here this evening are equally affected by the problems of blight? It is a huge worry for them. Through no fault of their own, they are going to suffer horrendous financial difficulties.
Sir John Stanley: I wholly endorse what my hon. Friend says. This is a massive proposal and it affects a large number of constituencies and individuals, all the way from Rugby in the midlands to the Cheriton terminal area in Kent.
The third group of constituents to whom I must briefly refer are those who are blighted and still without compensation along the line of the channel tunnel rail
1200
link. As far as those in my constituency are concerned—those on Blue Bell hill in particular—I very much welcome the markedly different attitude that my right hon. Friend the Secretary of State has taken compared to that of his predecessor in relation to the findings of the ombudsman on maladministration by the Department of Transport.
I welcome the fact that, when writing to my hon. Friend the Chairman of the Select Committee on the Parliamentary Commissioner for Administration—the hon. Member for Rugby and Kenilworth (Mr. Pawsey)— my right hon. Friend said:
"the Government is prepared to consider afresh whether a scheme might be formulated to implement the Committee's recommendation that redress should be granted to those affected to an extreme and exceptional degree by generalised blight from the CTRL"—
the channel tunnel rail link—
"from the period June 1990 to April 1994 and how it might operate."
I hope that my hon. Friend the Minister will tell us in reply when we can expect his right hon. Friend the Secretary of State to produce proposals to give effect to the recommendations of the ombudsman, which were accepted by the Select Committee.
10.18 pm
The Minister for Railways and Roads (Mr. John Watts): As my right hon. Friend the Member for Tonbridge and Malling (Sir J. Stanley) has reminded us, this is not the first time that we have debated these issues, although this evening it is at a more sociable hour. I thank him for this further opportunity to respond to him about the concerns of his constituents, for whom he has been such a vigorous and persistent advocate.
First, it is important to be clear about the provisions of the Land Compensation Act 1973 and the other measures intended to alleviate any adverse effects that may be caused by the operation of the railway system.
The Land Compensation Act 1973 allows householders to claim compensation from the responsible authority when the value of their property is diminished by physical factors, such as railway noise or vibration, caused by the use of new or altered public works. In the case of railways, the Act is not specific as to what is meant by "altered works" but it refers to their being
"reconstructed, extended or otherwise altered."
My right hon. Friend knows that the Act also provides for compensation to be claimed where there has been a change of use in respect of an existing railway line, but that in this case the Act specifies that "change of use" does not include intensification of an existing use. There is therefore no statutory requirement for compensation to be paid purely because traffic on an existing railway line has increased; this parallels the situation for roads. If people buy properties near an existing railway line—or, indeed, a road—they do so knowing that traffic can change in composition or volume. The law does not therefore require the body responsible to pay compensation in those circumstances.
In the case of an altered railway line, my right hon. Friend will appreciate that it is not for me to determine whether particular works undertaken are covered within the meaning of the Act; this is, in the first instance, for the responsible authority—in this case, Railtrack—to decide. It and its predecessor, British Rail, carried out the works.

1201
As my right hon. Friend knows, Railtrack has not to date accepted that any of the works cited by householders seeking compensation under the Act are works of
"reconstruction, extension or other alteration".
It is not for the Department of Transport to interpret the law but if householders believe that they have a case, the Act provides for them to pursue it with the Lands Tribunal and, ultimately, the courts. Householders who are not satisfied with Railtrack's response to their claims should seek professional legal advice.
As my right hon. Friend has acknowledged, although my right hon. Friend the Secretary of State has no statutory locus in the matter, he has both written and spoken to the chairman of Railtrack to ascertain the current position on claims which have been submitted to the company. The situation has not changed since my right hon. Friend the Secretary of State wrote to my right hon. Friend in July and October this year, although Railtrack is conducting some technical investigations following claims arising from works in the area of Bickley. The outcome of those investigations is awaited. I give an undertaking to my right hon. Friend that both I and my right hon. Friend the Secretary of State will pursue a response from Railtrack on the outcome of those investigations.
My right hon. Friend mentioned also the proposals of the Central Railway Group. I am pleased to confirm that statutory blight provisions under the Planning and Compensation Act 1991 will take effect from the date of an application under the Transport and Works Act 1992.
People whose land, or rights in land, would be compulsorily acquired under the proposals and were unable to sell their property at the open market value, would be able to serve blight notices on Central Railway. If Central Railway did not accept the owner's valuation, the matter would go to the Lands Tribunal for settlement.
Landowners who are entitled to serve blight notices may also be entitled to home loss payments. These are made in recognition of the personal distress and inconvenience suffered by people who are displaced by an authority acting under statutory powers.
In addition, people whose property, or rights in property, would be compulsorily acquired, are entitled to disturbance compensation for their reasonable expenses in moving. This would cover legal costs of conveyance of the house or flat, and other reasonable expenses as a result of the compulsory purchase.
If only part of the property is wanted, it may be possible to require Central Railway to buy the whole of the property, but this will depend on the particular circumstances. People affected in this way are advised to consult a solicitor or surveyor. If Central Railway disputes the claim, the matter can be referred to the Lands Tribunal for a decision.
Outside the limits of deviation of the works, claims for compensation for depreciation in the value of a property can be made under the Land Compensation Act; I have already outlined the provisions included in that Act.
My right hon. Friend mentioned the option to purchase scheme that Central Railway has been offering. I can confirm to him that I am advised that signing such options does not affect a person's statutory rights under the compensation code.
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With regard to the ability of the proposer of a scheme under the Transport and Works Act 1992 to fund the compensation, we would need to be satisfied that compensation could be paid. When a motion to allow the scheme to go to a public inquiry comes before the House, hon. Members, too, will wish to be satisfied that sufficient funding is available to deal with compensation for blight before the House gives authority to take the scheme to a public inquiry, which would be the next stage.
I am also grateful to my right hon. Friend for this opportunity to explain to the House the current position in relation to the Government's response to the sixth report of the Select Committee on the Parliamentary Commissioner for Administration about the channel tunnel rail link and exceptional hardship. The House last had a substantive discussion of this case in a debate initiated by my hon. Friend the Member for Mid-Kent (Mr. Rowe) on 6 March.
It may be helpful if I remind the House briefly of the history of this subject. The Parliamentary Commissioner's report was published on 9 February. The Commissioner had investigated five specimen cases relating to individuals who claimed that they could not sell their properties and had suffered exceptional hardship during the period of generalised blight relating to the rail link from June 1990 to April 1994. He found that my Department was guilty of maladministration in not considering the position of persons who had suffered that exceptional and extreme hardship and in not providing for redress where appropriate.
My Department has consistently rejected the Parliamentary Commissioner's findings: initially in its response to the Commissioner, which was published as an appendix to his report, and later in evidence given to the Select Committee by the permanent secretary on 1 March and by my right hon. Friend the Minister without Portfolio, the Member for Peterborough (Dr. Mawhinney) on 23 May.
The Select Committee published its report on 25 July endorsing the Parliamentary Commissioner's findings in this case. The Government seriously considered the Select Committee's recommendations and my right hon. Friend the present Secretary of State for Transport gave the Government's response on 1 November. That response was published the same day in the Select Committee's fifth special report.
The House will be aware that the Government concluded that they had to continue to resist the finding of maladministration, and that any new principle of administration implied in the Committee's report was unacceptable, but that they were prepared to consider afresh whether a scheme might be formulated to implement the Committee's recommendation that redress should be granted to those affected to an extreme and exceptional degree and to look at how it might operate. The Government agreed to look again at the possibility of a compensation scheme out of respect for the Select Committee and the office of the Parliamentary Commissioner, and without admission of fault or liability. We also made it clear that the Government would have to consider seriously the possible costs of a scheme, which cannot yet be established, and that, in view of their responsibilities to the taxpayer, they could not offer an open-ended commitment on an uncosted basis.

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Our consideration of whether such a scheme might be formulated is currently under way and we shall make as speedy progress as possible, taking account of the Government's undertaking to consult the Select Committee as proposals are developed and the need to consider seriously the possible costs of a scheme. However, until the process of fresh consideration is completed, it is impossible to say whether or what compensation arrangements might eventually apply.
I hope that I have been able to give my right hon. Friend a soupcon of reassurance on some of those important matters. I continue to appreciate his close interest in compensation and related issues. I hope that this will be the last time that we debate these issues, although that is ultimately a matter for my right hon. Friend.
Sir John Stanley: On my hon. Friend's first point, will he assure me that he and the Secretary of State will
1204
provide the House with a list of any other places along the line, apart from Bickley, where Railtrack feels that the works in question would entitle people to compensation? Will he ensure that that list is included in the information that he will give the House?
Mr. Watts: If there are instances of "new or altered" works which Railtrack accepts fall within the definition of the Act, those will be included in the list and that information will be made available to my right hon. Friend and the House. The difficulty is that until there are such works which Railtrack accepts are within the definition, there is no list. Therefore, any list that I might supply would merely be a blank piece of paper. We will convey to my right hon. Friend any information of the sort that he seeks which we can obtain from Railtrack.
Question put and agreed to.
Adjourned accordingly at twenty-nine minutes past Ten o'clock.