Commons Sitting of 19 March 2001

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. Speaker in the chair
Oral Answers to Questions
  DEFENCE
  The Secretary of State was asked—
  DEFENCE

    Community Involvement (Armed Forces)
    1. Mr. Barry Gardiner: If he will make a statement on his Department's policy on involving the armed forces in the community.[152698]
    The Minister for the Armed Forces (Mr. John Spellar): The armed forces are an integral part of the community. As the strategic defence review stressed, the armed forces serve the community by providing it with the defence it needs and by acting as a force for good in the world. They are also actively involved in the community—whether through their support of youth initiatives, their involvement in ceremonial duties, their participation in charity work, or their support to the civil authorities when the community as a whole is faced with an emergency.
    Over the past few months, they have demonstrated their dedication to the community in an unprecedented manner. More than 1,000 drivers stood ready to ensure that fuel
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    was delivered, essential services maintained and lives saved when the effects of the fuel protest threatened to get out of hand. Twice that number helped to defend lives and property from the most damaging effects of recent flooding. They performed those tasks as an integral part of the community they serve, working with the emergency services and other representatives of the community to promote the common welfare of the community as a whole.
    The armed forces are already providing logistics advice to the Ministry of Agriculture. Fisheries and Food to aid it with the disposal of slaughtered animals. We are of course responding promptly to any further specific requests for assistance that we receive from MAFF.
    Mr. Gardiner: I am grateful to my hon. Friend for his response, and I am sure that the whole House is grateful to the armed forces for their work in such emergencies. Will my hon. Friend specify the details of the specialist assistance that the armed forces are offering to tackle the foot and mouth outbreak?
    Mr. Spellar: Following the discussion with MAFF last week, the Ministry of Defence has agreed to provide MAFF with help in supervising the disposal of carcases of slaughtered livestock, focusing especially on the backlog of carcases that has built up. A logistics headquarters is being established in Devon to co-ordinate the activities of small teams drawn from the armed forces and deployed in the field. Those teams will reduce the burden on veterinary surgeons by helping to co-ordinate the efforts of the private contractors employed to dispose of the carcases. In doing so, they will speed up the disposal process and release vets to tackle the spread of the disease.
    Mr. Keith Simpson: I am sure that all Members will join the Minister in warmly thanking the armed forces for their work in aiding the civil power and local communities. He has touched on the foot and mouth outbreak, but could he be slightly more specific? Will he tell the House how many members of the armed forces

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    are involved at present, and whether he intends—if the crisis continues—to respond to any request by MAFF to use the armed forces on a larger scale, especially units of the Corps of Royal Engineers and the Royal Logistic Corps?
    Mr. Spellar: Yes, we stand ready to respond rapidly to further requests from MAFF, but, as the hon. Gentleman knows, it is always a case of striking a balance between the availability of service from civilian contractors and, in many cases, the geographical disposition of that service. At present, about 300 members of the armed forces are engaged, and about 50 two-man teams will be employed on local liaison work as well. The armed forces are already undertaking that work, but of course we recognise the scale of the problem and stand ready to respond.
    Mr. Robert Key: We are grateful to the Minister for explaining the work carried out in association with MAFF on the outbreak of foot and mouth. Will he explain any forward planning that might involve more members of the armed forces? Will that include not only the veterinary service and the Logistic Corps but an increasing number of Engineers, with their equipment? Will he tell us why the MOD is excluded from the Prime Minister's taskforce on foot and mouth disease, given that four other Departments are involved and when—obviously—the MOD will be crucial in the operation?
    Mr. Spellar: Certainly we stand ready to provide assistance, including on the engineering side. However, there are considerable resources in the construction industry that can undertake such work.
    With regard to membership of various committees, I think that I have been filmed going into Downing street to attend meetings on this matter. We are clearly involved and we stand ready to respond to requests from those who are dealing with these matters at first hand—which is exactly the appropriate relationship.

    Joint Military Capability
    Mr. Jeff Ennis: What measures are being taken to enhance joint military capability between the UK and its north American and European allies. [152699]
    The Secretary of State for Defence (Mr. Geoffrey Hoon): Work is progressing in NATO on the defence capabilities initiative in the five key areas of effective engagement, survivability of forces and infrastructure, command and control, sustainability and logistics, and deployability and mobility.
    We are also pursuing our commitments to the European Union headline goal, which will complement progress with the DCI to improve European military capabilities. Additionally, we are seeking greater capability and inter-operability with other nations through multinational defence co-operation.
    Mr. Ennis: On the eve of his visit to the United States, will my right hon. Friend tell the House what message he will take to the American Secretary of Defence?
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    In particular, will my right hon. Friend emphasise to Mr. Rumsfeld that the aims of the European defence security policy are consistent with the aims of NATO?
    Mr. Hoon: There will be a series of meetings in Washington in the next few days to ensure absolute consistency between NATO's efforts to improve military capabilities through the defence capabilities initiative and European efforts to do precisely the same thing through the achievement of the Helsinki headline goal. That is the message that I shall take to Washington.
    Mr. Julian Brazier: Will the Secretary of State confirm that for this country to take part in any major operation involving substantial airlift or intelligence capabilities—in other words, any major operation—would require American support? At a time when we may be close to a major outbreak of fresh conflict in the Balkans, will he tell us what extra resources our European allies are making available to match the extra commitments that we shall make under the European commitment that he has just described?
    Mr. Hoon: We have always made it clear that we would regard NATO and, therefore, United States support for such an operation as being the way in which we would undertake any major operation. A number of our European allies are certainly increasing their defence expenditure, but, equally, we have made it similarly clear that the vital matter is not simply how much money is spent—important though that is—but what it is spent on. That is precisely why it is so important that we pursue, through the DCI, improvements in NATO's capabilities, including heavy lift, as well as the absolutely consistent approach in the Helsinki headline goal to improve European capability. I take it from the hon. Gentleman's observations that he supports the efforts that we are making.
    Mrs. Alice Mahon: On joint military capabilities, some weeks ago 1 asked the Ministry of Defence what happened to Kosovo Liberation Army terrorists when they were arrested by KFOR and taken to Camp Bond Steel. Perhaps I am still waiting for an answer because, far from charging the terrorists, it would appear that the US contingent of KFOR was training them in the American sector and allowing them to smuggle arms and launch attacks across the borders of Serbia and Macedonia. What are the leaders of KFOR going to do about the situation in Macedonia? Are we simply going to abandon them to this attack?
    Mr. Hoon: I am sorry that my hon. Friend appears to be misinformed. The United States has made it absolutely clear that it is giving no active or tacit support to any kind of terrorist activity. It remains entirely even-handed in the way it deals with terrorist activity, from whichever ethnic community it comes. I assure her that it is not engaged in activity of the kind that she describes.
    Mr. Menzies Campbell: Does the Secretary of State agree that we may be about to witness a real test of joint military capability if the dangerous situation in Macedonia deteriorates any further? If that happens, does he agree that it may be necessary for NATO to do more than strengthen patrols on the border?

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    At a time when the United States is indicating that it intends to withdraw troops from Bosnia, does not the situation in Macedonia provide an ideal opportunity for the European nations to show that they are serious about military capability and about Europe taking more responsibility for European defence issues?
    Mr. Hoon: I can assure the right hon. and learned Gentleman that those in the NATO capitals have been in regular contact in recent days about the increasing tension on the borders of Macedonia. There have been discussions, which continue, about the appropriate action for KFOR to take and who should initiate it. At this stage, I am not in a position to tell the House more than that, except to say that we regard the situation there with grave concern and we will take appropriate action when necessary.

    Accommodation (Service Personnel)
    Ms Rachel Squire: If he will make a statement on his plans to improve single living accommodation and married quarters overseas for service personnel. [152700]
    The Parliamentary Under-Secretary of State for Defence (Dr. Lewis Moonie): The Government are determined that our military personnel will have good living accommodation. Last week, my right hon. Friend the Secretary of State announced a major new initiative for improving service single living accommodation in the United Kingdom. We also plan upgrade programmes for both single living and family accommodation overseas. Significant projects are already in hand, such as the rebuilding and refurbishing of all accommodation in Cyprus. The new money made available to the defence budget in the 2000 spending review has allowed us to increase the investment in upgrade programmes elsewhere.
    Ms Squire: I welcome the announcement on improving the standard of service accommodation made last week by my right hon. Friend. On a recent visit to Episkopi barracks in Cyprus, I was impressed by the professionalism of the 1st battalion, the King's Own Scottish Borderers, but appalled by the standard of single living accommodation that it has endured during its two-year tour of duty, so I welcome the Minister's assurance that it will be improved. Can he also assure me that, as the first battalion should have transferred to Catterick by now, the standard of accommodation there will represent an improvement? Does he agree that one can only ask what the previous Government were doing for 18 years to allow such substandard accommodation to be provided for our armed services personnel?
    Dr. Moonie: My hon. Friend will be well aware that the history of the previous Government was one of a steady and slow decline in the overall quality of accommodation. I have visited many sites in the United Kingdom and Germany and I have made it clear that I find them unacceptable. She will be glad to know that our additional money for overseas investment is projected to build up to £55 million a year over the next few years. That will go a long way to remedying the deficits.
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    The problem cannot be cured overnight, but we have made a start and we have promised that we will continue that work.
    Mr. Gerald Howarth: I do not want to be churlish, so I am bound to say that I welcome the investment in accommodation, especially that for Aldershot, because the Minister knows that the accommodation in Montgomery lines is particularly poor. However, it is appalling that, five days after the Secretary of State for Defence smuggled out the information by way of a written answer and despite my representations to his office, I have still not been told what investment will be made in Aldershot. I learned from the Minister for the Armed Forces, speaking on Southern Counties Radio, that there would be £3 million of investment for Aldershot, but will the Under-Secretary tell us precisely what that means for my constituents, or whether it is just money for the future and another Labour mirage?
    Dr. Moonie: The hon. Gentleman may not have wanted to be churlish, but he certainly made a dashed good stab at it. Given the many sites that need upgrading, it has sadly not been possible to notify every right hon. and hon. Member about our plans. However, when we have specific proposals, they will be informed about them. Late last year, I saw the situation at Montgomery lines at first hand and we have managed to identify separate moneys that will go towards the temporary upgrading of the accommodation on that site. However, we recognise that we cannot replace all the substandard accommodation overnight.

    Ministerial Meetings (France)
    Mr. John Bercow: When he last met the French Defence Minister to discuss European security. [152701]
    The Secretary of State for Defence (Mr. Geoffrey Hoon): I last met Alain Richard on 9 February this year at Cahors to discuss a range of defence issues of mutual interest, including European security.
    Mr. Bercow: I am grateful to the right hon. Gentleman for that reply. When the Prime Minister referred in The Sunday Telegraph yesterday to those people who really may have
    "an agenda to destroy NATO",
    assuming that he did not intend to incriminate himself, did he mean the French? If not, who did he mean? If he did mean the French, why cannot the Secretary of State see that the Prime Minister's collusion for more than two years with the French "federasts" from St. Malo to Cologne and from Helsinki to Nice is clear evidence of knavery, folly or a potentially lethal combination of the two?
    Mr. Hoon: The Prime Minister was referring not to Governments, but to those individuals who seek to undermine NATO.
    Mr. Bercow: Name names.
    Mr. Hoon: For example, the hon. Gentleman should think of those who go from the United Kingdom to

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    Washington to pour scorn into the ears of those who have not considered the matter in detail. By undermining or seeking to undermine European co-operation, they are of course undermining the United Kingdom—not something that any British Government or any responsible British Prime Minister would seek to do.
    Mr. David Winnick: If it was necessary to have a common European security policy with the United States to stop the ethnic cleansing in Kosovo—a policy that I urged and fully supported—is it not now necessary to have again a common European security policy to stop Albanian extremists, who are not representative of the Albanian people, undermining the peace and security that have come to the Balkans?
    Mr. Hoon: I made it clear in response to an earlier question that NATO capitals are looking carefully at the situation on the border with Macedonia. We regard the matter with grave concern and, certainly, we are taking appropriate action to deal with any kind of extremism from any ethic community.
    Dr. Julian Lewis: Given that the European rapid reaction force will draw on the same forces as NATO, how will it be able to engage in an operation in which, by definition, NATO does not wish to engage, without reducing NATO's capabilities for the operations in which it does wish to participate? Have the French, for example, said that they intend to allocate a single extra soldier, sailor or airman to the defence of Europe, or will they simply raid the forces allocated to NATO?
    Mr. Hoon: The hon. Gentleman makes a good point. We have made it clear that we would distinguish between the war-fighting activity in which we would expect NATO to be involved, for which forces that have been allocated to it are properly and suitably trained, and the peacekeeping Petersberg tasks, in which we would expect the European Union to engage. That is why there is no inconsistency between our efforts with NATO and the EU to improve military capability.
    Mr. Tony Benn: Given the many statements made in Washington and London about the importance of NATO and Europe working side by side, why were the French Government not informed by the Americans when they bombed Baghdad?
    Hon. Members: Answer that.
    Mr. Hoon: I shall try to deal with a number of factual errors that my right hon. Friend has set out. In the first instance, the so-called bombing of Baghdad was a self-defence operation, conducted by the coalition forces in defence of their aircraft. Although some targets were near Baghdad, it is stretching the facts to suggest that they were in Baghdad. As for information that is communicated to the French, it is for the coalition to determine the appropriate time when allies are informed. I am sure that they were informed at an appropriate stage.
    Mr. lain Duncan Smith: The Secretary of State is using sophistry to cover
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    the Prime Minister's words. The Prime Minister made his position clear in an interview in The Sunday Telegraph, in which he said:
    "well, if we don't get involved in European defence … then those people who really may have an agenda to destroy NATO will have control of it."
    In 1997, after the Amsterdam summit, he was utterly opposed to a Euro defence programme, which he described as an "ill-judged transplant operation", but, by 1998, he was suddenly in favour of it. Which group of nationals did the Prime Minister have in mind when he referred to those who wish to destroy NATO?
    Mr. Hoon: I have already answered that; I am sorry that the hon. Gentleman was not paying attention. Perhaps he was also not paying attention when the previous Government set out and signed up to a common European defence policy at Maastricht. Certainly, the great majority of Conservative Members supported that, although I suppose that I should excuse him because he opposed it. Does the Conservative party oppose everything to do with the EU instinctively, even when it is clearly in Britain's best interests to participate? Has its loose coalition on Europe broken down?
    Mr. Duncan Smith: Yet again, it is quite clear that the Prime Minister did not tell the Secretary of State about those people who will be destroying NATO, because he has not got a brief to that effect. The reality is simple. As ever, the Government are facing in two directions at once. On the one hand, they are telling the Americans, "Don't worry. Trust us"; on the other, they are saying to the people who will destroy NATO, "Don't worry. You can trust us, too. We're all in this together." Is it not the reality that since St. Malo, they have colluded in a process that will deliver the destruction of NATO? In addition, the Prime Minister said in the interview that he was a great believer in natural law—we now know that the Government spend all their time flying by the seat of their pants.
    Mr. Hoon: I am sorry that the hon. Gentleman finds the world such a confusing and difficult place. I am sure that it would be simpler for all of us if, like the modern Conservative party, we simply turned our back on any sort of international development, irrespective of whether it was in Britain's interest, as well as on any sort of European development. The position that the hon. Gentleman sets out is that it is all very complicated and too difficult for us, so it is far easier to stick our head firmly in the sand and leave it there.
    Mr. Dennis Skinner: Does my right hon. Friend recall that many years ago at Labour party conferences there used to be long resolutions from the constituency parties that advocated the withdrawal from NATO? I and one or two of my hon. Friends used to support that proposition, and I am not a supporter of the Common Market either. I get my cake and eat it too—I am quite enjoying this little spat and I hope that it will go on for a long time.
    Mr. Hoon: My hon. Friend will recall that in those days, I was sometimes required to appear before the Bolsover general management committee. It is fair to say that on those occasions, although I was a minority of one,

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    I consistently supported membership of both the European Union and NATO. I am delighted that the Labour party and now the Labour Government have also adopted that position.

    RAF Numbers
    Mr. James Gray: How many people left the Royal Air Force in each of the past three years. [152702]
    The Minister for the Armed Forces (Mr. John Spellar): A total of 14,138 people left the RAF in the three years ending 31 December 2000; 4,847 left the service in 1998, 4,712 in 1999 and 4,579 in 2000. That was balanced against intake figures of 4,088 during 1998, 4,759 during 1999 and 3,731 during 2000.
    Mr. Gray: Those figures are accurately reflected at RAF Lyneham in my constituency, where each year up to 5 per cent. more people leave than come in. That is not merely a result of overstretch caused by Sierra Leone and the Balkans; it is also caused by very poor living conditions and failure to invest in infrastructure at RAF Lyneham. Does the Minister agree that more people are now leaving the RAF than are joining and that that makes a mockery of the fine words in the strategic defence review's "Policy for People", which stated that
    "delivery of tangible improvements in overstretch and undermanning"
    was entirely dependent on finding new people? Why have the Government failed to do that in the three years since the SDR, and what does the Minister intend to do about it now?
    Mr. Spellar: I did not read out the outflow figures for the years under the previous Conservative Administration. We inherited a figure of 7,512 in 1997; in 1996—the Conservatives' last full year in office—the outflow figure was 10,544; in 1995 it was 5,610, and in 1994 it was 6,394. In every one of those years, there was a greater outflow than any that has occurred under the Labour Government. We are matching intake figures to outflow figures. The RAF recruited 98.6 per cent. of its requirement last year.
    The hon. Gentleman has a real cheek to talk about accommodation when the Conservatives did nothing about it for 18 years and after my right hon. Friend the Secretary of State and my hon. Friend the Under-Secretary have announced a major building programme to rectify the problems. I thank the hon. Gentleman for his endorsement of our policy, but not for his party's dereliction of duty.
    Mr. Dafydd Wigley: Will the Minister arrange for those figures to be analysed to determine whether there is evidence of a significant number of people with minor disabilities leaving the RAF when those disabilities do not prevent them from undertaking their responsibilities; and whether there is any danger of discrimination against people with minor disabilities in RAF recruitment?
    Mr. Spellar: The right hon. Gentleman mixes two issues: first, requirements on recruitment and, secondly,
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    changes in people's health and abilities occurring during their service. My hon. Friend the Under-Secretary is undertaking a review of service intake to match up the number of those with minor disabilities to modern day requirements.
    The right hon. Gentleman will be aware that all the services, rightly, do a great deal to accommodate those who have already undertaken training, committed themselves to the service, and have a lot to offer. A balance has to be struck in the light of the requirement that all service personnel be available for active duty, but he will know that that is handled effectively and sensitively by the services.

    RAF Bases (Commercial Development)
    Caroline Flint: What steps he has taken to promote the regeneration of former RAF bases for commercial aviation use. [152703]
    The Parliamentary Under-Secretary of State for Defence (Dr. Lewis Moonie): A number of former RAF bases have been or are in the process of being sold for civil aviation purposes, including Finningley in my hon. Friend's constituency, Manston, Farnborough, and Kemble. Our usual policy is to market a former airfield for civil aviation purposes where that is consistent with the current planning process and Government accounting regulations.
    Caroline Flint: I thank my hon. Friend for his answer. May I congratulate the Government on their decision in 1997 to stop the previous Government's proposal to turn RAF Finningley into the fourth prison in my constituency? May I also congratulate them on excluding the option of quarrying on one of the best runways in the country and disposing of it for aviation use?
    Will my hon. Friend confirm that former RAF bases have made a valuable contribution to the development of regional and civil aviation? Will he also confirm that several airports, including Manchester airport before it got permission for a second runway, expressed interest in the purchase of Finningley which, with the second longest runway in the north and excellent weather conditions, is ideally suited to be a civil airport?
    Dr. Moonie: I can certainly agree with my hon. Friend's final remarks. Finningley offers a superb site for an airport. I understand that Doncaster metropolitan borough council has approved a planning application to develop a major international airport site and that it has been called in for determination by the Department of the Environment, Transport and the Regions. Several airfields have been or are being sold for purposes which, we firmly believe, will continue to expand civil aviation.
    Sir Sydney Chapman: In order to meet the strategic defence review's commitment to raise gross receipts of £700 million from the sale of surplus defence land by 2002—perhaps the Minister will confirm that that is on course—is it the Government's policy to

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    get the maximum commercial return from such spare land, subject to planning permission, or to designate particular areas of spare defence land for particular purposes?
    Dr. Moonie: The position is not quite as the hon. Gentleman says. We discuss things carefully with local councils—with their elected representatives if necessary, but certainly with the planning authorities—to try to establish the best use of a site, which then goes forward for bidding in the usual tendering process. In those circumstances, we seek to get the best possible commercial return from the deal.

    Ministerial Meetings (France)
    Mr. Tony McWalter: When he last met his French counterpart to discuss naval co-operation between France, the UK and the USA. [152704]
    The Secretary of State for Defence (Mr. Geoffrey Hoon): I regularly discuss bilateral naval co-operation with both my French and American colleagues. When I last met my French counterpart on 9 February in Cahors, naval co-operation formed part of the background to our discussions. The close nature of our naval co-operation with the United States was most recently demonstrated by agreement to the permanent stationing of a British sailor on the USS Winston Churchill, which was launched last week.
    Mr. McWalter: I thank my right hon. Friend for his answer. Given the similarity in the size of the French and British naval forces, will my right hon. Friend set out for the House the full extent of co-operation between them? In particular, will he make clear the synergy between that co-operation and work with the United States navy?
    Mr. Hoon: I am grateful to my hon. Friend. There is an agreement on naval co-operation with the French, which covers a wide range of activity, including operations. In addition, 20 formal working groups have been established, dealing with training, submarine co-operation, operational planning, doctrine communications and personnel exchanges. That agreement was drawn up in 1996 and signed by the then Secretary of State for Defence. As my hon. Friend said, the size of our respective navies means that there are significant opportunities for co-operation with the United States navy, which we pursue vigorously.
    Miss Anne McIntosh: Like the Secretary of State, I welcome co-operation with the United States, but does he not accept that co-operation on submarines, especially with the French navy, is crucial to our long-term training for submarine warfare?
    Mr. Hoon: Co-operation on submarines is at a relatively early stage; visits were conducted to one another's ports only recently. There are obviously matters of great national sensitivity surrounding our nuclear submarine fleet, and I am sure that the French believe that that is so for them, too. There are certainly practical benefits in co-operation, not least in the light of the appalling disaster and loss of the Russian submarine Kursk.

    Armed Forces (Retention)
    Dr. Brian Iddon: If he will make a statement on the steps being taken to improve retention in the armed forces. [152705]
    The Minister for the Armed Forces (Mr. John Spellar): Armed forces retention is being tackled as a matter of the highest priority. We have introduced a wide range of measures aimed at improving retention through policies that genuinely reflect the priorities of our people and their families, both at home and on deployment. Last month, we announced that we had accepted the Armed Forces Pay Review Body's recommendations in full, and our people will see that reflected in their pay packets in May, backdated to April. Last week, my right hon. Friend the Secretary of State announced our plans to spend up to £200 million a year on an upgrade programme to bring single living accommodation up to the standards expected by service personnel in the 21st century.
    In addition, I am pleased to announce that we shall introduce a further package of improvements to the operational welfare package, which will extend welfare provision to include all maritime deployments and exercises lasting two months or more. From next month, all personnel deployed on operations or on exercises lasting more than two months will receive hot shower facilities and laundry, and a comprehensive communications package, including 20 minutes of free telephone calls each week, free e-blueys and free e-mail facilities— [Interruption.]—to enable personnel to keep in contact with their families.
    We will also be introducing an additional British Forces Broadcasting Services channel and NAAFI retail facilities in the Balkans, and providing additional leisure and fitness equipment in all our operational theatres for off-duty relaxation. [Interruption.] In all, this welfare package will amount to an additional £60 million over the next four years. [Interruption.]
    Dr. Iddon: I am staggered by that answer. I do not know whether I have a supplementary question left, after that. I am pleased that my hon. Friend recognises that the welfare of our services personnel is an important component of retention. Although good housing is important, as other hon. Members have observed, does my hon. Friend agree that there are other factors, apart from those that he mentioned— [HON. MEMBERS: "He mentioned quite a lot."] He did, indeed. I refer to factors such as counselling when people run into personal difficulties, good schooling for children, and as my hon. Friend suggested, that partners are kept in contact with one another when they are separated, especially when people serve for long periods overseas. [Interruption.]
    Mr. Spellar: We should understand the dilemma that the Opposition are in: those are all issues that they neglected over 18 years. We are rectifying matters. There is a long list of step that we are taking to improve the welfare of our forces, who will note the way in which the Opposition responded to our announcements. The improvements have long been required, and they recognise the pressure that our people are under and the contribution that they make. As my hon. Friend knows, we are dealing with schooling in this country through the service families taskforce and also through the service

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    education system, under my hon. Friend the Under-Secretary of State. We are introducing real change; the Opposition did nothing about it.
    Mr. Mike Hancock: I am sure that, like me, most hon. Members appreciate that. Service men and women know only too well who let them down over the previous 18 years. Most of what the Minister announced is welcome, but will he deal with two issues for which he was responsible? One is the speedy settlement of service men's compensation claims, not least the claims of men who did not have proper malaria cover when they were in Sierra Leone. The other concerns the anomalies relating to Pay 2000 and the way in which that has undermined the rates pay of for senior enlisted personnel.
    Mr. Spellar: No one will lose money under Pay 2000. We are always prepared to examine anomalies as a system is introduced. As the hon. Gentleman will know from his previous incarnation, pay systems are extremely difficult, but from the response that we have had, we believe that Pay 2000 is a welcome development. With regard to malaria, the situation has been slightly overplayed by the media. The facts that we have ascertained do not bear out the scare stories, but where there is liability, as I understand there clearly is in one case, there will be speedy settlement of that claim.
    Mr. Quentin Davies: Before the hon. Member for Bolton, South-East (Dr. lddon) gets too carried away by his Government's propaganda, I should tell him that a number of the announcements that have just been made are recycled and were originally made months ago.
    Having had a few minutes of reflection, will the Minister for the Armed Forces accept that he gave a thoroughly disingenuous answer to my hon. Friend the Member for North Wiltshire (Mr. Gray) on the vital matter of numbers? There is no comparison between the planned reduction of our forces in the 1990s, which was consequent upon the end of the cold war, and the current Government's monumental failure to achieve the targets set out in their strategic defence review. What is more, they are continuing to go backwards. Is there now the slightest hope that the Army will achieve even its latest target of a 97 per cent. level of effectiveness by 2004, given that under the Government's mismanagement, net retention in the armed forces continues to decline?
    Mr. Spellar: I have to give it to the hon. Gentleman—he is certainly a good sport and is being very fair. It is good of him to remind the House and the country of his Government's lamentable record regarding the sackings, or compulsory redundancies, that occurred in the armed forces, and of the huge numbers of people in the Army whose employment was terminated early. That had a considerable effect on recruitment; indeed, the previous Government left us with significant under-recruitment. In a period of rising employment, with the lowest unemployment figures for 25 years, it is a tribute to our recruitment teams that they have been able to maintain the position, despite the appalling circumstances with which the Conservatives and their gross mismanagement left us. It is good of him to remind us of that.

    Colchester Garrison
    9. Mr. Bob Russell: When temporary additional accommodation for members of the Parachute Regiment will be provided within the Colchester garrison. [152706]
    The Parliamentary Under-Secretary of State for Defence (Dr. Lewis Moonie): I am pleased to say that recruitment to the Parachute Regiment is currently buoyant. We expect it to be 45 personnel over establishment by August this year. I am sorry to say, however, that that has led to a shortage of service accommodation in Colchester. The private finance initiative project at Colchester will address that problem. In the short term, temporary accommodation will be used to alleviate the situation. We expect that to be available for use by the Parachute Regiment by mid-August.
    Mr. Russell: Does the Under-Secretary accept that the previous Government's privatisation of Army married quarters at a give-away sales price, added to the MOD's lack of forward planning, means that more than 200 members of the Parachute Regiment are renting more than 70 private houses in Colchester—a town that already has the worst homelessness record in the east of England? Will he give an assurance that the target date of mid-August will be advanced? The Parachute Regiment has been in Colchester for the best part of a year, so the forward planning should have been done long ago and the accommodation should be available now.
    Dr. Moonie: I fully accept the catalogue of difficulties that the hon. Gentleman describes. I assure him that the temporary bed spaces, of which there will be 224 in all, will be available in August, when we need them. Regrettably, a number of personnel—primarily officers and senior non-commissioned officers—will continue to be accommodated in married quarters. Some of them may have to remain in private rented accommodation, but the new spaces will have an enormous effect on easing the problem.
    Mr. Crispin Blunt: I accept that the money for single soldiers' accommodation in Colchester and elsewhere is welcome, but the Under-Secretary will know that the £100 million a year extra that is being spent on accommodation exceeds the whole defence budget increase, as set out in the comprehensive spending review. It is now well known in the Ministry of Defence that the long-term costings process has been absolutely bloody and that serious consequences will be announced. When can we expect to learn the results of the long-term costings process?
    Dr. Moonie: I seem to remember that the hon. Gentleman was responsible for advising the previous Government on some of the appalling policies that they introduced. I am happy to say that we have managed to secure valuable additional resources for accommodation, which should be welcomed by every hon. Member. That has not been done at the expense of any other long-term planning. We have decided that there should be a proper balance in the allocation of resources. For too long,

    15
    the previous Government allowed accommodation to go to rack and ruin—something that this Government are no longer prepared to tolerate.

    National Missile Defence
    Mr. David Atkinson: What his latest assessment is of the impact of the United States proposal for a national missile defence on UK defence policy. [1527071
    Mr. Huw Edwards: If he will make a statement about the US national missile defence proposal. [152711]
    The Secretary of State for Defence (Mr. Geoffrey Hoon): The United Kingdom shares the United States concerns about the problem of missile proliferation and will continue to work with that country in tackling it. It is clearly not in Britain's interest for our closest ally to feel vulnerable to attack. We understand the role that missile defence can play as one element of a response. However, until the US makes specific proposals, it remains premature to reach judgments about the impact on UK defence policy, although, as we have made clear, we want to be helpful to our closest ally.
    Mr. Atkinson: The Secretary of State said that he shared the United States assessment of threat. When the Western European Union's Technological and Aerospace Committee went to Russia last month, we found that Russia also shared that assessment. Will the right hon. Gentleman now take a robust lead in promoting discussion in NATO between the United States, Russia and our European allies on shared missile defence, which would deter any rogue state that has weapons of mass destruction from threatening to deploy them?
    Mr. Hoon: We have already held several discussions in NATO about missile defence; I am sure that they will continue. We have encouraged the United States to discuss Russia's problem with Russia, which also suggested a proposal for missile defence. NATO is evaluating that. That process will continue, and it is sensible for all the countries to consider carefully the offensive and defensive systems that are designed to deal with nuclear proliferation.
    Mr. Edwards: Does my right hon. Friend agree that there is unease about the US missile defence system? Does he also agree that it is reckless for the Conservative party to give unfettered support to the project at this stage, when discussions are continuing between the US and other NATO partners?
    Mr. Hoon: I do not recognise my hon. Friend's description of the UK Government's position. We have made it clear that it is sensible for discussions to take place among allies in NATO. We have always encouraged the US to hold discussions with Russia and China. Discussions with Russia are under way. However, we have also said that we should not rush into such a project.
    16
    It should be considered calmly and responsibly, in full consultation with allies. I am delighted that the US has adopted that position.
    Sir Geoffrey Johnson Smith: We all accept that it will take some time before a system is developed. However, why has the Secretary of State got such a hang-up about accepting the principle of the US programme? I understand from his comments that he has not accepted it.
    Mr. Hoon: I am sorry if the right hon. Gentleman misunderstood my remarks. He mentioned a programme; although the previous US Administration made a proposal, the new US Administration have not proposed a specific programme. We have made it clear to the US that we want to be helpful when it makes a specific proposal. However, at Camp David, President Bush said:
    "As to whether there will be sites or no sites in the United Kingdom, that's too early to determine, because t have yet to propose to the Prime Minister what will work."
    It makes sense for the UK, as the United States closest ally, to work closely with it and to be helpful if it makes a specific proposal. However, it makes no sense to respond until the US has made its proposals in its defence interests clear.
    Mr. Iain Duncan Smith: The Secretary of State is engaged in the new Labour process of sending different messages to different groups in the hope that they do not speak to each other. I know that the Ministry of Defence has told him that he must make a decision. There is a threat, which is likely to grow in the next four to five years, to the UK. The question for the Government is, therefore, not whether the Americans feel threatened, but whether a threat to the United Kingdom is developing. If they agree that there is such a threat, they should say that they support ballistic missile defence in principle. They said that about the euro, why cannot they say it about the defence of the UK?
    Perhaps the Government fear splits. I have a long list of Labour Members who oppose and work to destroy Trident. The list includes the hon. Members for Leyton and Wanstead (Mr. Cohen) and for Crawley (Laura Moffatt), who are members of the Select Committee on Defence. The Labour party is therefore split and worried about the election.
    Mr. Hoon: I sha11 deal with the hon. Gentleman's substantive point about the threat. While we have always recognised that there is a potential threat to Britain's deployed forces and we would want to investigate and examine it to seek ways of protecting the deployed forces, we have not yet been advised that there is any threat to the United Kingdom today.
    I have set out this matter in the House on a number of occasions. I am intrigued that, despite my doing so, the Opposition have decided that there is a threat. I would be interested to know the source of their intelligence on that matter, if "intelligence" is not too strong a word in this context. We continue to monitor the situation, and the Government would certainly report to the House should our perception of any such threat change. However, for the moment, as I have made clear on many occasions, there is no assessment of any threat to the United Kingdom.

    European Rapid Reaction Force
    Mr. Edward Leigh: If he will make a statement on the development of a European rapid reaction force. [152710]
    The Secretary of State for Defence (Mr. Geoffrey Hoon): There is no standing European rapid reaction force. Efforts in the European Union are focused on improving military capabilities to meet the headline goal. Nations identified initial contributions to this goal last November. We are now engaged in detailed analysis of the improvements required, and the action needed to put those improvements into effect.
    Mr. Leigh: I do not think that I have ever heard a British Prime Minister say that the Opposition have been effective in changing attitudes in the American Administration. However, that is what the Prime Minister said in his interview with The Sunday Telegraph yesterday, although he was rather rude about it. I seem to remember words such as "poison", "ears" and "dripping" being used. I wonder whether this could have influenced the United States Defence Secretary's comment that
    "We need to be vigilant to see that we don't do anything that could inject an instability into the alliance
    Is that diplomatic-speak for "I don't like the smell of this. It sounds like limey double-speak to me, but I don't want to criticise it openly because we need Brit support for bombing Saddam Hussein"?
    Mr. Hoon: I am sorry that the hon. Gentleman has become so tired and cynical in opposition that he cannot accept words at their face value. The United States Administration have set out their position very clearly, as did the new US President at Camp David. Like their predecessors, they want European defence to develop in a way that strengthens NATO, and so do we. The Prime Minister agreed with the United States President on that at Camp David. Mr. Rumsfeld also said, in the course of the interview to which the hon. Gentleman referred, that the devil was in the detail, and he was right. We are determined to ensure that those details continue to be developed in ways that will support and strengthen the alliance. That is the position of the British Government, and will continue to be so.
    Mr. Syd Rapson: On the development of a European rapid reaction force, does my right hon. Friend agree that training is imperative, and that Whale island in Portsmouth in my constituency has unique facilities that ought to be used to cross-pollinate the value that we can obtain from such facilities?
    I thank my right hon. Friend for his visit to my constituency, and apologise personally for the bad press, which was unfounded. I hope that that will not deter him from coming again, because the visit was appreciated by my constituents and by many of the trade unionists working in the naval base.
    Mr. Hoon: I had an excellent visit to my hon. Friend's constituency, and I assure him that it was not in any way affected by the somewhat tendentious headlines that followed. I was certainly very impressed by what I saw on Whale island and I thought that it provided an excellent
    18
    facility. As he knows, the question of armed forces training is still being reviewed right across the United Kingdom. I cannot, therefore, give him a specific answer to his question today, save to say that he has mounted an extremely vigorous and effective campaign on behalf of his constituents and I am sure that he will continue to harry and harass Ministers with the considerable ability that he has already displayed.
    Mr. Ian Taylor: I am sorry that the Secretary of State is being given a bad press wherever he goes. Some of us understand that.
    As for the substantial point about European defence co-operation and European defence initiatives, any enlightened Member will welcome greater European defence co-operation as long as it is supportive of NATO, as the Secretary of State said. Do the French now see his point of view, and can he be much more specific about what might happen in Macedonia if action were required and the Americans decided to pull back? Have we yet reached a point at which the right hon. Gentleman is confident that a European presence could be effective in keeping the sides apart on the Macedonian border?
    Mr. Hoon: I know that the hon. Gentleman, who was a Minister in the last Government, is an expert on bad press. I assure the House that the limited criticism that occurred in a Portsmouth paper following my visit is not something over which I am likely to lose any sleep; but should 1 require advice on dealing with bad publicity, I shall be grateful for the hon. Gentleman's implied offer of assistance. [HON. MEMBERS: "What was the headline?"] It is a matter of private grief. I shall leave it to the House of Commons Library to reveal.
    As for the more serious matter raised by the hon. Gentleman, I cannot tell him at this stage precisely how allies propose to deal with the continuing instability along the border of Macedonia. He will understand why it is important that consultations with allies continue—there needs to be broad agreement among them on how to tackle the problem—but we are engaging in close consultation with both NATO capitals and the Macedonian Government. I assure the hon. Gentleman and the House that a determined effort is under way to resolve the continuing instability.

    Procurement (North-west)
    Maria Eagle: How many jobs were (a) created and (b) sustained as a result of procurement decisions in the north-west since 1997. [152712]
    The Parliamentary Under-Secretary of State for Defence (Dr. Lewis Moonie): It is estimated that 350,000 jobs are dependent on defence expenditure and equipment exports. Over 60,000 new contracts are placed each year. The Ministry of Defence does not record the number of jobs created or sustained as a result of each individual procurement decision, but it is estimated that a substantial number of jobs in the north-west of England depend

    19
    directly on defence equipment expenditure by the Ministry of Defence, and that many more will be created as a result of our recent procurement decisions.
    Maria Eagle: Does my hon. Friend agree that, while the Eurofighter is important to the future effectiveness of the RAF, it is also important to the future of the economy of the north-west, where it is sustaining and creating thousands of jobs? Will he assure me that, unlike the Conservative party, he will remain committed to the project?
    Dr. Moonie: I am happy to give that absolute assurance. Hopefully, the development of the A400M will mean a long-term future for employment in the aircraft industry in the area for many years.
    Mr. John Wilkinson: Are not the defence industries in the north-west, as elsewhere, important not just for jobs but for improving the technological base of industry as a whole? Will the Minister—in the words of his right hon. Friend the Secretary of State—seek to be helpful to the United States in regard to any research programme, development and, ultimately, work that could ensue from ballistic missile defence?
    Dr. Moonie: Perhaps the best example I can give of a tangible project with which we are dealing, as opposed to the fantasy to which the hon. Gentleman refers—at present, anyway— [Interruption.] If we could have fewer moronic remarks from Opposition Front Benchers, I might be able to answer their hon. Friend's question.
    I can tell the hon. Gentleman that we are determined to pursue the development of the joint strike fighter, with collaboration from companies in the United States. The project should provide a promising aircraft for our future needs.

    RAF Pilots (Retention)
    Angela Smith: What steps he is taking to improve the retention of pilots in the RAF. [152713]
    The Minister for the Armed Forces (Mr. John Spellar): The retention of pilots is a critical problem, not just for the RAF but for other armed forces around the world. Many pilots choose to leave the services at an early opportunity to pursue a second career with civil airlines. Improving pilot retention rates is therefore one of our highest priorities. Indeed, that was reflected in the announcement of the armed forces pay award for 2001, which, in addition to a 3.7 per cent. increase in basic salary for all ranks, will result in increases in flying pay. There will also be the introduction of a targeted financial retention incentive for RAF aircrew of up to £10,000 available for two years, linked to a commitment to continue serving. The scheme is an interim measure pending the outcome of the comprehensive review of aircrew retention that is being initiated.
    Angela Smith: I thank my hon. Friend for that answer, and welcome the response that he gave earlier to my hon. Friend the Member for Bolton, South-East (Dr. Iddon). Retention levels decreased to an all-time low in 1996, and the measures that he has introduced are welcome. However, can he assure me that the matter will be kept under constant review, and that new measures will be introduced as times change and they become necessary?
    Mr. Spellar: Yes, I can certainly give my hon. Friend that assurance. We are also in discussions with other NATO countries on sharing experiences of the issue. Additionally, we believe that some of the other measures that we have highlighted today, particularly those on accommodation, will help to assist with retention.

Points of Order
3.31 pm
Mr. Dafydd Wigley: On a point of order, Mr. Speaker. In view of the statement made over the weekend on radio and television by the Minister of Agriculture, Fisheries and Food on the likelihood that foot and mouth originated from the illegal importation of infected material, have you had a request for a statement by him to the House? The matter is extremely important and must be cleared up. Indeed, there is a need for a ban on the importation of all such meats from all countries that may be affected by foot and mouth.
Mr. Speaker: I have had no approach from the Minister.
Mr. Michael Fabricant: On a point of order, Mr. Speaker. In the past hour, the Minister for the Armed Forces and some other Ministers have given particularly long answers not to supplementary questions, but to the initial questions. They will have been reading those answers from their brief. Will you advise Ministers and their officials that such written answers should be shorter so that hon. Members can ask more supplementary questions?
Mr. Speaker: I could also advise some hon. Members that their questions should be shorter

Orders of the Day

  CONSOLIDATED FUND (NO. 2) BILL
  Order for Second Reading read.
  Question, That the Bill be now read a Second time, put forthwith, pursuant to Standing Order No. 56 (Consolidated Fund Bills), and agreed to.
  Bill accordingly read a Second time.
  Question, That the Bill be now read the Third time, put forthwith, and agreed to.
  Bill accordingly read the Third time, and passed.

  Regulatory Reform Bill [Lords]
  [Relevant documents: Second Special Report from the Deregulation Committee, Session 1999—2000 (Pre-Legislative Scrutiny of the draft Regulatory Reform Bill), HC 488; Third Special Report from the Deregulation Committee, Session 1999—2000 (Further Report on the draft Regulatory Reform Bill), HC 705; and First Special Report from the Deregulation Committee, Session 2000—01 (The Handling of Regulatory Reform Orders), HC 328.]
  Order for Second Reading read.
  Mr. Speaker: I have selected the amendment in the name of the Leader of the Opposition.
  3.33 pm
  The Minister for the Cabinet Office (Marjorie Mowlam): I beg to move, That the Bill be now read a Second time.
  All Governments regulate to protect consumers, the environment, employers, employees, and society as a whole. The Government were elected on principles of fairness, justice and equality of opportunity, and those are the principles that we have put into practice in introducing fair and effective regulation. That is not about red tape or petty bureaucracy. The Government have no need to apologise for legislating for decent holiday entitlement, safety in the workplace, or policies to make work pay, such as the working families tax credit and the minimum wage. Those are commitments that we made in our manifesto, and they are commitments that we have honoured.
  Despite arguments made by Opposition Members when we introduced a fair minimum wage, jobs have not been lost. Introducing the working families tax credit has not lost jobs. Introducing proper maternity leave has not lost jobs, nor has taking action to tackle discrimination against the disabled. On the contrary, as we saw last week, for the first time in 25 years, United Kingdom unemployment has fallen below 1 million. We have a healthy and stable economy, with low inflation, low interest rates and low unemployment. I am proud of the action that we have taken and of what has been achieved.
  As so often in politics, however, it is essential that we strike the right balance. Unnecessary or over-complicated regulation that is difficult to enforce is a burden on everyone. It stifles enterprise and limits opportunity. which is why we have taken active steps to ensure that the regulations that are introduced are necessary, simple, and easy to understand and implement.
  Mr. Michael Fabricant: The right hon. Lady said that the Conservatives had predicted a loss of jobs as a result of the introduction of the minimum wage. Does she recall that at that time the Labour party was promising a minimum wage of £5? Will she now say what the current level of the minimum wage is?
  Marjorie Mowlam: We are not here to discuss the details of the minimum wage; we are here to discuss regulation and its reduction. The Tories always claim that they would reduce regulation, but the hon. Member for Tiverton and Honiton (Mrs. Browning), a Minister in the previous Government who tried to reduce regulation, said:
  "We would be the first to say that we did not do very well".— [Official Report, 19 November 1999; Vol. 339, c.250.]
  Moreover, in December 1987 the Institute of Directors said:
  "The excessive burden of regulation on business is halting growth and preventing companies from entering new markets…every year the Government has added to red tape".
  Before the hon. Gentleman gets into the detail of what we have introduced, it would do no harm if he looked back at what the Conservatives did.
  Mrs. Gwyneth Dunwoody: The national minimum wage is a great point of principle. I would have thought that the Conservative party, rather than arguing about whether it supported a particular rate of pay, would accept that this is the first time in the industrial history of this country that a large number of low-paid women have been taken out of poverty wages. The House should be proud of that.
  Marjorie Mowlam: I thank my hon. Friend for her contribution; the minimum wage helped poor women, but Conservative Members keep trying to use the figures to inflate the cost of regulation. They and their supporters have quoted figures amounting to anything from £5 billion to £13 billion, but those figures include the administrative costs and the actual costs of the policies. Including the cost of paying the national minimum wage and the working families tax credit, and of administering other policy changes, boosts the costs of bureaucracy in a gross, unfair and misleading way. The real cost of administering Government policies is a fraction of what the Conservatives have suggested.
  As so often in politics, it is essential to strike the right balance. No one wants unnecessary, over-complicated and burdensome regulation. We have taken active steps to ensure that what regulations are introduced are necessary, simple, and easy to understand and implement. I chair a panel on regulatory accountability whose key task is to scrutinise Departments' regulatory proposals and ensure that they meet that high standard. I call Ministers to come to the panel and justify their proposals if the panel thinks that they do not meet its criteria.
  In the Cabinet Office, the regulatory impact unit operates across government to ensure that Departments make a thorough appraisal of the costs and benefits of any new proposals or regulations, and to suggest changes and improvements wherever it can. Departments now have to produce regulatory impact assessments across the board. The Government are aided in that by two powerful advocates at the heart of government. The Small Business Service, set up in April last year, is headed by David Irwin
  24
  and includes an independent council of outside experts to advise on the specific needs of small firms. The better regulation taskforce, headed by Lord Haskins, was set up in September 1997. Its members are drawn from a wide range of backgrounds, including business, consumer organisations and trade unions. Each organisation can voice concerns about regulation and seek improvement. It would be fair to say that Lord Haskins, in particular, has not shied away from making public some constructive criticisms when he thought it necessary.
  Mr. John Redwood: Since the Government came to power, there have been more than 300,000 net job losses in manufacturing. The textile industry is one of the sectors that has been savaged by the Government's policies. Is the right hon. Lady seriously asking us to believe that all the Government's efforts to raise its costs have had nothing to do with the job losses? Does she not see that some people have gone from low pay to no pay, partly as a result of massive over-regulation?
  Marjorie Mowlam: I was focusing on the 1 million extra jobs that have been created. That is the important point for people who have no employment, and now many more people have jobs. When people have been out of work, getting a job snakes all the difference.
  The Bill is another tool to help the Government simplify and improve the quality of regulation. I welcome the support given to the Bill from all parties in the other place. We are grateful for the contributions made in debates there by many noble Lords and for their constructive approach to amending the Bill. I think that their contributions have improved it.
  I hope that a similar constructive engagement will be possible during the Bill's passage through this House. It is, after all, designed to build on and improve the Deregulation and Contracting Out Act 1994, passed by the previous Government.
  Mr. Andrew Lansley: If the Government's intention is to build on the 1994 Act, will the right hon. Lady tell us what efforts the Government have made to use it? How many deregulation and contracting out orders were made in the year prior to the May 1997 general election, and how many have the Government made in the past year?
  Marjorie Mowlam: My recollection is that we have used the legislation about 10 times. That is not an excessive number, but it shows that there is a need to reform the 1994 Act, to extend its powers and to make it clear, so that it can be used more often.
  Mr. Brian White: Is my right hon. Friend aware that in giving evidence to the Select Committee on Public Administration, the right hon. Member for Henley (Mr. Heseltine) said that the hype regarding the 1994 Act was overblown?
  Marjorie Mowlam: I appreciate my hon. Friend's intervention.
  Mr. Anthony Steen: On a point of order, Mr. Speaker. A moment ago, an Opposition Front Bencher asked a question of the Minister, and we did not have the answer. I can give it: there were 37 orders up until 1997.
  Mr. Speaker: That is not a point of order.
  Mr. Lansley: Will the right hon. Lady give way on a point of information?
  Marjorie Mowlam: I have already taken interventions on that point, and I should prefer to move on.
  The important point is that the Bill is based on the Deregulation and Contracting Out Act 1994, which was passed by the previous Government I am waiting to see whether Opposition Members will point out that we voted against that Act.
  Mr. Lansley: We will.
  Marjorie Mowlam: Good. I will be waiting for that point, because my answer is that we needed to change the 1994 Act to make it workable. We are using it as a basis for the Bill. We need to update the Act because, among other things, its powers are limited to pre-1994 legislation; it cannot remove burdens from the public sector; it does not allow subsequent amendment of deregulation orders, which limits its scope; and it defines regulatory burdens too narrowly.
  I shall give the House an example. The Government want school governing bodies to be able to offer after-school child care, which they can do at present only if they provide education at the same time. The Act does not allow positive change to address such problems. It is simply common sense that it should be possible to change the law to allow people to do things just as it is possible to change the law to stop them doing things. In updating and improving the 1994 Act, we recognise the importance of maintaining tough, clear safeguards. The Bill itself is an example of how we want to proceed
  Mr. Lansley: Perhaps now I will make the intervention that the right hon. Lady anticipated, because the right hon. Member for Livingston (Mr. Cook) did indeed oppose the Deregulation and Contracting Out Bill on Second Reading, on the basis that the powers that were to be taken were exceptional and excessive. If the Government believe that those powers are no longer exceptional and excessive, will she accept that they were introduced for a specific purpose—that of deregulation? Will she admit to the House that the purpose of this Bill is not deregulatory but re-regulatory?
  Marjorie Mowlam: No, the hon. Gentleman has got it completely wrong. For the reasons that I gave earlier, the Bill is necessary to build on and improve the Act passed by the previous Government.
  Mr. Steen: I shall help the right hon. Lady by telling her why the Bill is needed. Up to 1997, 37 orders were repealed; in 1998, the figure was only five; in 1999, it was four; in 2000, it was one, and in 2001 only one
  26
  order has been repealed. Something needs to be done to change the law. The view of Conservatives Members is that these changes are not the ones that are needed.
  Marjorie Mowlam: I should like to hear from Conservative Members what changes they think necessary. I have outlined our changes, which stem from the work that we have done. We have provided the Library with a list of 50 measures—
  Mr. John Bercow: Fifty-one.
  Marjorie Mowlam: We changed the number to 50. All those measures could be taken under the new Bill. In addition, we have today issued five consultation documents on orders that will be made possible by the Bill and, between them, bring benefits of almost £40 million. The estimated compliance cost for those orders is nil.
  Mr. Lansley: Will the right hon. Lady give way?
  Marjorie Mowlam: Yes, but this is the last time because I am making very little progress.
  Mr. Lansley: If this is to be the last time that the right hon. Lady gives way, she ought now to provide us with the killer fact. If the benefit that she seeks to achieve through the Bill is a reduction of £40 million in the regulatory burden, will she remind the House what has been the cumulative impact of additional regulation introduced by the Government since May 1997? The latest calculation by the British Chambers of Commerce is that the amount is more than £10 billion. Will she put the two figures side by side and tell us whether or not this is a regulatory Government?
  Marjorie Mowlam: Earlier in my speech, I gave the answer to that question. The costs that the hon. Gentleman quotes include the entitlements and benefits that individuals received through the changes that we introduced and the bureaucracy involved in implementing them. The real costs are a fraction of that figure. We shall not apologise for the costs of introducing the minimum wage, improving maternity leave, giving people holidays and working to ensure that discrimination against people with disabilities does not happen. I shall not apologise for any of it and if the costs of the policies themselves are set aside, our regulatory costs are much, much less.
  In addition, we introduced the legislation after listening to the views of business, business groups and consumer groups, and changes were made. As a result, it was introduced in a way that did not cost jobs. Exemptions were made for smaller businesses and most businesses were happy to acknowledge that the legislation was valuable to their work force.
  Mr. Peter L. Pike: Will my right hon. Friend give way?
  Marjorie Mowlam: Will my hon. Friend give me a minute—perhaps two or three minutes?
  Orders made under the Bill will be subject to thorough consultation and examination by scrutiny Committees in both Houses. The process will not avoid scrutiny.

  27
  The deregulation Committees in both Houses are serious, efficient and competent bodies and the scrutiny will be up to a high standard. Legal safeguards, including the European convention on human rights, will need to be satisfied for each order.
  In addition, before introducing a proposal, Ministers must be confident that the benefits of removing a regulatory burden are sufficient to justify the order being made and that the order maintains any necessary protection and does not remove any rights or freedoms that people could reasonably expect to continue to enjoy.
  When proposing to introduce burdens, a Minister must also be confident that the order strikes a fair balance between the public interest and the interests of the individuals affected by it and that any burden imposed by that order must be proportionate to the benefit to be had, to the satisfaction of the scrutiny
  Committees.
  In addition to those safeguards and consultation requirements, the order will be subject to careful scrutiny in Committee in both Houses and will proceed only if both Committees report favourably. That procedure has worked successfully to date in relation to the 1994 Act and I trust and believe that it will continue to do so.
  Mr. Pike: I chair the Deregulation Committee. Is my right hon. Friend surprised to hear that no Conservative Member chose to attend its pre-legislative scrutiny of the Bill? Is she also surprised to hear that Conservative Members no longer consider themselves to be members of the Committee? I wrote to the Conservative Chief Whip asking him to replace them, but even though the Conservative party considers deregulation important, that position has not changed.
  Marjorie Mowlam: Those important points show the commitment of Conservative Members, and I look forward to a comment from the hon. Member for South Cambridgeshire (Mr. Lansley) on that intervention.
  Mr. Steen: I would like to make a comment. As a member of the Deregulation Committee, I can tell the House that only one deregulatory order has been made this year. Last year, only one was made. The hon. Member for Burnley (Mr. Pike) knows that he does nothing, and the Committee does nothing. The Bill is being debated to give them something more to do.
  Marjorie Mowlam: With those safeguards in place, and for the Committees concerned, let me outline some of what we might wish to do under the Bill that is not possible under the 1994 Act. Situations often arise in which, with the passage of time, legislation has become outdated and no longer fits people's day-to-day needs. Anomalies develop and it simply no longer makes sense.
  For example, invalid care allowance can be claimed only by people between the ages of 16 and 65. Why stop at 65? People often carry on caring beyond that age, so we want to change the law so that over-65s have a right to claim too. We also want to make changes so that in circumstances where the person being cared for dies, the allowance will continue to be paid for up to eight weeks to allow the carer time to come to terms with the loss.
  28
  We propose to make changes to the vaccine damage payment scheme to reduce the disability threshold and to allow minors the opportunity to claim right up until the age of 21.
  As a final example, we would like to take important steps to relieve the burden on NHS charities, which currently have to submit their accounts twice to two separate Government bodies. That is not common sense; by making a simple change, we will help those charities to keep down significantly their administrative overheads and to make the most of donations given to them by the public.
  Those are just a few examples of what can be done; there are many, man others. Today, we published a list of 50 measures that could be delivered, and I have placed copies in the Libraries of both Houses.
  Mr. Bercow: Read them out.
  Marjorie Mowlam: Certainly. If the hon. Gentleman wants me to read them, I shall do so with pleasure. [Interruption.] I have left the list in my office; what bad luck. [Interruption.] I have been passed a copy; I do not want to disappoint the hon. Gentleman if he wants to hear them.
  For the hon. Gentleman's benefit the measures include: the abolition of 20 partner limit; after-hours child care at schools; approval of local education authority curriculum complaints procedures; attachment of earnings; births and deaths—Wales; births and deaths—errors on certificates; bootleggers—disclosure of names, for Customs and Excise; building regulations; business tenancies; civil registration service reform. I think that I have made my point.
  In addition, we issued five consultation documents today that will make possible, under the Bill, benefits of almost £40 million. We are consulting on orders—I shall give specific examples for the hon. Gentleman—to simplify, speed up and make fairer the procedures for new business leases; to
  put lease renewals for local authority tenants on the same looting as those for business tenants; to make it easier to a low pubs to open for longer on new year's eve and on the Queen's golden jubilee; to improve the grant and loan an arrangements for the renewal of private sector housing; and to allow people to use bank notes and smart cards in gaming machines.
  Mr. Graham Brady: That is important.
  Marjorie Mowlam: Some of the measures may not be crucial, as the hon. Gentleman implies, but what is important is that the legislation makes sense—that is one of the reasons that we are introducing the Bill. Regulation should not be burdensome; it should be easy to implement and should protect rights while not making heavy demands on business. That is what good government means. The Bill is no incredibly large, but it will improve the services we offer the public. That is important—it does not matter how small the changes are, as long as they benefit people.
  Mr. Steen: The right hon. Lady looked at me when I reacted to her remarks on gaming, so it is only right that I should respond. I served on the Committee for a long

  29
  time and it often struck me that a great number of the rules and regulations that we were repealing had to do with dancing and gambling, as if this country spent all its time dancing and gambling. We can dance on Sunday nights; we can gamble with a Switch card or a smart card. We must take care that the Bill does not merely encourage more and more gambling and dancing.
  Marjorie Mowlam: It would take more than the Bill to increase dancing and gambling. Even though I have doubts about some forms of gambling, I think that dancing and fun are good for our society.
  The estimated compliance costs for the measures that I outlined are nil.
  As well as looking at where we can simplify or streamline regulations, we are also considering how to improve enforcement. Sensible enforcement—not going over the top—is a key part of good regulation. That is why the Government are working with local authorities and those responsible for enforcing central Government regulation to agree to a concordat— [interruption.] This is an important point. The concordat will offer a blueprint for fair and common-sense enforcement.
  We hope to have 100 per cent. of the bodies that we are working with signed up by the summer. It is a voluntary process, which we hope succeed, but if there are cases where an improvement in enforcement practice is needed, the Bill contains a reserve power for Ministers to make codes of practice on enforcement for the benefit of business and the citizen.
  As was done in another place, I trust that hon. Members will agree that the Bill will provide a valuable tool for this and future Governments to use in the fight against unnecessary, overlapping and over-complex legislation. It has already been welcomed by many people outside the House. For example, the Institute of Directors said that it is a
  "good Bill…if it is used to its full poteritial, [it] should make a noticeable difference to the red tape burden '.
  Mr. Lansley: If.
  Marjorie Mowlam: If the hon. Gentleman wants me to cite the Conservative party's record, he will find that he is not in a strong position to criticise.
  Digby Jones of the Confederation of British Industry said:
  "The Bill has the potential of providing he tools to deliver real benefits to business".
  Mr. Lansley: Will the right hon. Lady give way?
  Marjorie Mowlam: No.
  The Federation of Small Businesses believes
  "that the Bill will be useful in helping to reduce the overall burden on business".
  Sir Jeremy Beecham of the Local Government Association has given strong support for the powers in the Bill and its potential for
  "reducing the burden of central regulation on local authorities".
  We value those expressions of support, but the real test for the Bill will be the reforms achieved under it in the months and years ahead.
  30
  Contrary to some press reports, the United Kingdom is not a heavily regulated society. Independent reports, such as that from the Economist Intelligence Unit in spring last year, show that we have the least regulated labour market in Europe. Similarly, the Organisation for Economic Co-operation and Development's economic outlook, published in December 1999, said that the United Kingdom had he lowest level of product-market regulation of any OECD country.
  We can be proud of that record, while being proud of the fact that the Government have introduced important measures to safeguard the interests of consumers and employees and to protect the environment. It can no longer be said that social justice— the minimum wage, decent holiday entitlements, decent maternity pay and working benefits—is incompatible with economic efficiency, low unemployment, low inflation and low interest rates. It has taken this Government to show that, and it is a record of which I am proud.
  4.3 pm
  Mr. Andrew Lansley: I beg to move, To leave out from "That" to the end of the Question, and to add instead thereof:
  "this House declines to give a Second Reading to the Regulatory Reform Bill [Lords] because it seeks to extend the use of powers intended solely for a deregulatory purpose to the creation of new burdens and to the rewriting of legislation without a specific deregulatory effect; and fails to apply sufficient consultative, scrutiny and review provisions to the exceptional powers proposed."
  I listened with growing amazement to the Minister for the Cabinet Office, because this is a regulatory Government, as is shown by their record, on which she sought to base her accusations about the previous Conservative Government. Indeed, they are one of the most regulatory Governments that we have had for a very long time. That stands in absolute contrast to everything that the public and the business community were told before the election.
  In April 1997, in a document entitled "Labour's business manifesto"—which seems to be a contradiction in terms—the Labour party pledged
  "not to impose burdensome regulations on business, because we understand that successful business must keep costs down."
  What have we discovered since then? In December 2000, the CBI published its own analysis, which stated that the Labour Government had introduced 3,000 new regulations, that regulations were being introduced at the rate of 10 a day in 2000 and that those regulations had cost the business community £23 billion since the election.
  Mr. White: Is it not true that 3,000 regulations were implemented in the final year of the previous Conservative Government?
  Mr. Lansley: The director general of the British Chambers of Commerce said that about 3,000 to 3,500 regulations and statutory instruments are passed each year and, in an article in The Times in November 2000, the Parliamentary Secretary, Cabinet Office said that only about 5 per cent. of them have a direct impact on business. Let us leave aside the fact that many of them have an indirect impact but, even if the figure of 5 per cent. is correct, that means that 175 of the statutory instruments

  31
  passed each year have a direct impact on business. Furthermore, they come on top of the 175 that were passed in each of the preceding years.
  If the hon. Gentleman wants to understand what is happening under this Government, let us consider the rate at which red tape is impacting on business and on small businesses in particular. Small businesses are acutely vulnerable to the impact of burdensome regulations, and members of the Government never seem to be aware of that fact—I guess that they never run a small business. Perhaps some of them do so. In recent days, we have discovered that one or two of them have been engaged in business on their own account, but I shall not go into that.
  The rate at which the cost of red tape is increasing has gone up. Each year, the Institute of Chartered Accountants conducts a survey based on information obtained by its advisers who conduct and prepare the accounts of small businesses. It uses their expertise to consider the cost to businesses each year of implementing the new regulations that were introduced in the preceding year. In October 2000, the institute showed not only that the regulations increased the costs of small businesses by an average of 4 to 6 per cent., but that for the smallest and micro businesses the rate at which those costs increased nearly doubled in the year to July 2000 compared with 1999.
  Mr. Bercow: Is my hon. Friend aware that, at various stages over the past four years, some Ministers appear to have been so unfocused that they were unaware of what their own Government were doing? In particular, is he aware that the right hon. Member for Hartlepool (Mr. Mandelson), who was then the Secretary of State for Trade and Industry, said in what proved almost to be his swan-song that
  "we have no intention of introducing any legislation that presents a burden on business and reduces the competitiveness of British firms.— [Official Report, 25 November 1998; Vol. 321, c. 214.]
  Which planet was the right hon. Gentleman inhabiting?
  Mr. Lansley: I concur with my hon. Friend's observation. I have been interested in what Ministers seem to be unaware of, and there are two explanations for the statement of the right hon. Member for Hartlepool (Mr. Mandelson). The first is that it has become part of his stock in trade—indeed, that of the Labour Government—to say one thing while doing something completely different. It is not that Ministers do not know what is happening, but that they want people to believe that something else is happening. They want the public at large not to understand that manufacturing and business experience daily the problem of increasing red tape.
  The second explanation for the right hon. Gentleman's statement is that in November 1998 he was otherwise engaged busily raising money for the dome, for which he was responsible at that time.
  Marjorie Mowlam: If we are considering issues of which folk are aware, I am sure that the hon. Gentleman is aware of the Small Business Service, which we set up. It specifically focuses its work on assisting small businesses with regulations. We have extended the periods in which regulations are implemented and we have given audit exemptions by raising the threshold from
  32
  £350,000 to £1 million, which has saved small businesses £180 million a year We have taken a number of other initiatives. I will not bore the hon. Gentleman with them now, but they do not suggest that this is a Government who do not take the needs of small businesses into account.
  Mr. Lansley: The Small Business Service amply illustrates the point made by my hon. Friend the Member for Buckingham (Mr. Bercow) and with which I agreed. The Government set up the Small Business Service with the objective that it would be the British equivalent of the Small Business At ministration and would act as a powerful engine to represent the small business community inside government.
  I have news for the right hon. Lady. She and the Secretary of State for Trade and Industry may not have noticed that the business community sees the Small Business Service as no more than a repackaging of what went before. In the enterprise component of the training and enterprise councils, business links and various other bodies, the Government sought to impose initiatives on the business community. They have not allowed the business community to take ownership of the service in the way that the previous Conservative Administration intended.
  The right hon. Lady seems to think that I am personally responsible for everything that the previous Conservative Administration did. She should know that as leader of the deregulation taskforce, my right hon. Friend the Member for Horsham (Mr. Maude) made it clear that, in his view, the Conservative Government were making limited steps towards deregulation. At the same time as we were trying to introduce a substantial number of deregulatory measures, the cumulative burden of regulation was continuing to increase. That is why we have the policies that we have, which I shall deal with shortly. On that basis, she should understand that this Government have gone badly in the wrong direction by increasing dramatically the cumulative burden on businesses.
  Mr. Peter Kilfoyle: The hon. Gentleman waxes lyrical about small businesses and the burdens that have allegedly been imposed on them since 1997. I am sure that he will agree that most farms, with the exception of agri-businesses, are small businesses. How many livestock inspectors were there in 1992 under the previous Government, and how many were there in 1997?
  Mr. Lansley: I cannot give the hon. Gentleman those precise figures, but a deregulation contracting-out order relating to the Slaughterhouses Act 1974 removed duplicate requirements for the licensing of slaughterhouses. He should know that in the year up to the last election, as my hon. Friend the Member for Totnes (Mr. Steen) made clear to the Minister, the previous Conservative Government introduced 26 deregulation and contracting-out orders. The pace of deregulation was growing. This Government introduced five such orders in the following year, four in 1999, one in 2000 and only one this year, which is a sad record.
  Mr. Kilfoyle: Does the hon. Gentleman accept—will he take my word for it?—that the number of livestock inspectors decreased between 1992 and 1997? Deregulation is not always in the interests of small business.
  Mr. Lansley: We all understand that deregulation has to be balanced. That is why the previous Administration were pursuing deregulatory measures while occasionally introducing regulatory measures. The hon. Gentleman seems unwilling or unable to accept the fact that the cumulative burden on business is a significant part of our competitiveness. It is no good Labour Members talking about the positive aspects of specific regulations without taking account of the context within which each regulation, which they regard as attractive, adds to the burden of the total costs on business.
  At the last election, the Labour party said that it understood that burdensome costs should not be imposed on business, but the burdens barometer of the British Chambers of Commerce sets the total cost of burdens at £10 billion-plus. The analysis published for Politea by Nicholas Boys-Smith shows that the annual cost of this Government's regulations since 1997 will be £12.7 billion by May 2001.
  Mr. Ronnie Campbell (Blyth Valley): Is the hon. Gentleman saying that the minimum wage, the working families tax credit, the directives on working time, maternity leave and part-time working and the Disability Discrimination Act 1995 put burdens on business that, if elected, the Conservatives would remove?
  Mr. Lansley: The hon. Gentleman simply adds to the same point. Let us consider those measures—[Interruption.] If the hon. Gentleman allows me, I will respond to his question.
  It is pretty straightforward. My argument is twofold. First, undesirable and unnecessary regulatory burdens have been imposed: for example, the burden of trade union recognition—[Hon. MEMBERS: "Oh!"]—yes, and the way in which that was done. It is clear that the threshold at which trade union recognition was introduced extends the requirement down to small businesses that, in effect, have no personnel function. Labour Members should understand that the way in which that requirement was imposed will act as a major additional burden on small businesses that are not equipped for trade union recognition.
  Marjorie Mowlam: Will the hon. Gentleman give way?
  Mr. Lansley: Let me complete my point before doing so.
  There has been a string of such measures, including the working time directive. We had no choice about the implementation of the working time directive in this country, although the previous Conservative Administration tried to frustrate it The way in which it was introduced—with a lack of lead times and a lack of clarity in the regulations that it imposed—was extremely damaging to business. In examining the costs and benefits of implementing the working time directive, I meet many business representatives. When I ask about their experience, most reply that they incur massive administrative costs and that most employees simply opt out of the directive's effect. Therefore, the costs are large and the benefits small.
  Marjorie Mowlam: The hon. Gentleman should get his facts right. Small businesses employing fewer than
  34
  20 people are exempt from legislation on trade union recognition. The job of the Small Business Service, which he quickly dismissed, is to consult small businesses, and each regulation is considered to ensure that small businesses do not suffer.
  Mr. Lansley: I have to take issue with the right hon. Lady. The director general of the British Chambers of Commerce says that his research shows that only 21 per cent. of firms with fewer than 50 employees have a dedicated personnel resource, whereas the figure for firms with more than 50 employees is 71 per cent. It is all very well for the right hon. Lady to talk about firms with 20 employees, but a more appropriate threshold for trade union recognition would have been 50 employees or more.
  I question not the principle of trade union recognition, but the appropriateness of the way in which the requirement was introduced and the threshold that was set, given that the impact on small businesses has been disproportionate. The Government say, "Think small first", but they simply did not do that. Through the costs that it imposes on small businesses, the directive is having an effect on competitiveness.
  The Parliamentary Secretary, Cabinet Office (Mr. Graham Stringer): Will the hon. Gentleman give way?
  Mr. Lansley: Let me provide a couple of summaries to which I shall invite the Minister to respond. Digby Jones of the Confederation of British Industry says of the Government:
  "They have a track record over three years of being one of the most regulations-keen administrations for some time".
  Chris Humphries of the British Chambers of Commerce says:
  "Despite all its rhetoric, the reality is that Government has dramatically increased the regulatory burdens that threaten small business competitiveness. Excessive red tape is stifling the very enterprises the Government is seeking to promote".
  Mr. Stringer: Does the hon. Gentleman accept that setting a threshold of 50 employees would exempt about 98 per cent. of all businesses in this country? If he is so concerned about small businesses, will he explain why there has been a net increase of about 150,000 in the number of small businesses since the Labour Government took control, whereas there was a net decrease in that number between 1990 and 1993?
  Mr. Lansley: The Minister simply does not understand the argument as business understands it. He will know that I am a former deputy director general of the British Chambers of Commerce; it was my job to represent small businesses and to understand their position. They know, as I know and he should know, that businesses constantly face the question of what will happen as the economic cycle turns down. The current Chancellor of the Exchequer has no more abolished the economic cycle than any previous Chancellor has been able to. British business most needs to be competitive when it competes in declining domestic and overseas markets. A few months ago, a PricewaterhouseCoopers survey showed that, compared with the average of EU businesses, two thirds

  35
  of UK businesses' relative advantage in competitiveness had been lost during the four years of the Labour Government.
  Such competitiveness is easily eroded and is difficult to regain. I am afraid that we will not begin to discover the damage done by the Government until businesses start to struggle and lose. Manufacturing businesses that are exposed to international trade have already discovered it; businesses in the service sector that are dependent on cyclical changes in demand will, unfortunately, discover it when the Chancellor's tax and spend policies take us down that unhappy path.
  That is why, on 5 March, Forbes Magazine could, unfortunately, publish an article for an international readership, in which it said that the Government were
  "quietly loading the British economy down with new taxes and regulations that threatened to erode the advantages of doing business in Britain".
  Under this Government, we have discovered that the rate of regulation has gone up, as demonstrated by the survey of the Institute of Chartered Accountants in England and Wales and other work. The position is getting worse, and deterioration is accelerating. Legislation has grown increasingly complex; Conservative members of the Committee that considered the Finance Act 2000 are only too aware of the immensity of financial and tax legislation and the complexity imposed by it.
  Too often, consultation is a dead letter. The business community, for example, will have seen that the Prime Minister was so keen on consultation on the work-life balance that, before it concluded, he was prepared to pre-empt it and make announcements at the Labour party's spring conference in Glasgow. Regulatory impact assessments, as provided for by the Government, have been wholly inadequate. They have not been independently audited and are highly subjective, reflecting Ministers' need to try to justify their legislation.
  The right hon. Lady talked about policy costs on the one hand and implementation costs on the other. Regulatory impact assessments are highly confusing and tend to muddle policy costs and implementation costs. They tend to exaggerate benefits and underestimate costs. Most of all, the Government's record on regulation demonstrates complete unwillingness to recognise the cumulative effects on the business community of the regulations that they have introduced and continue to introduce.
  Marjorie Mowlam: I wish the hon. Gentleman would stay in the real world. We have not exaggerated benefits. We have independent business people working alongside us on the regulatory impact assessments and in the taskforce. If, like the hon. Gentleman, they felt that we had done such a terrible job and had failed, they would tell us. As I acknowledged earlier, Chris Haskins criticised one or two measures. Overall, however, our work has been welcomed.
  Rather than criticise us using figures with which I do not agree, the hon. Gentleman would do much better to do what we have been doing in Europe—try to work with other member states to make sure that there is not an additional burden from Europe. We are working with other European countries, both bilaterally and in the
  36
  Mandelkern group, to make sure that, by the time we get to Stockholm, we have a level playing field on European regulation. That is much more important than the hyperbole that we have just heard.
  Mr. Lansley: There is no hyperbole here, just simple facts. The right hon. Lady has come to the House to introduce a Bill designed, she says, to build on the Deregulation and Contracting Out Act 1994. I have demonstrated that the Government have no interest in deregulation; frankly, Labour Members had no interest in the 1994 Act. Before the election, large numbers of orders were made and the pace was increasing. Since the election, however, the pace has diminished to the point at which virtually no deregulation and contracting-out orders are being made.
  The Government blame the lack of candidates for such orders. The reality is that there is a lack of will; the Government have no will on deregulation.
  Mr. Steen: I am sorry to stop my hon. Friend in mid-flow, as he is making rather a good speech, but does he intend to come on to the Bill itself? We are listening for that. I want to ask him some questions about it, and I did not want him to sit down without my having had that opportunity.
  Mr. Lansley: Clearly, I gave my hon. Friend the impression that I was engaged in a peroration. There may be those who wish it, but I was not. I was simply seeking to demonstrate that we cannot trust the Government on the subject of deregulation and regulation. They wear deregulatory clothes while engaging in a regulatory objective.
  The Bill is intended by the Government, in the dog days of this Parliament, by their lights, to persuade the business community that they have a deregulatory purpose in mind, whereas the business community knows, from its unhappy experience, that regulation is what the Government intend, sometimes to the point at which the utilities, for example, are experiencing nationalisation in a different format.
  The Bill is a transparent example of such activity. It is about regulation, perhaps as the new Labour alternative to nationalisation, whereby the Government can get control of businesses without having to pay the price for doing so.
  Marjorie Mowlam rose—
  Mr. Lansley: I have given way many times. I shall make progress as my hon. Friend the Member for Totnes wants to hear some views about the Bill, and I shall be happy to supply him with some.
  We oppose the Bill and we have tabled a reasoned amendment. I shall tell the House why. The Bill is not a deregulatory Bill. It is designed to create new burdens. It is designed to allow the public sector to reduce its burdens, while it imposes burdens on the private sector. It is designed to allow the public sector to undertake additional expenditure in legislative form, without the usual scrutiny that is applied to legislation for that purpose.
  The Bill lacks provision for the necessary external consultation. Most of the important information on proposals would be presented only at the point that they

  37
  went before the Deregulation Committee, but that information would not necessarily be given to the business community and all those who would be affected, who ought to be the principal participants in a consultation process before deregulation committees sit.
  Mr. Fabricant: Does my hon. Friend agree that the acid test of the Bill is whether, if it had been enacted, it would have prevented the Government from wasting £628 million of public money on the millennium dome?
  Mr. Lansley: I am sure that the answer to my hon. Friend's question is no, the Bill would not have prevented that. However, I believe that the acid test is: if the Bill had been enacted and the Government had had the benefit of it, what would have been the practical result?
  Mr. Redwood: More regulation.
  Mr. Lansley: I hear the answer from my right hon. Friend from a sedentary position. The Bill would have resulted in more regulation. Moreover, the Government found that in the previous Session they had a crowded legislative programme. They found it difficult to introduce primary legislation to suit their legislative purpose, so not only have they resorted, as we know, to the routine guillotining of Bills and the constriction of parliamentary debate, but now they have found a new mechanism that allows them to amend primary legislation, bring in new regulations and take on new responsibilities for the public sector, all by means of a statutory instrument that amends primary legislation without all the scrutiny that should be the product of our parliamentary process.
  The right hon. Lady thought that I would intervene on the subject of the Labour party's attitude to the Deregulation and Contracting Out Bill during its passage through the House. The right hon. Member for Livingston (Mr. Cook) spoke on Second Reading about the power that was to be taken in that Act. He said:
  "Ministers would be able to repeal full Acts of Parliament by statutory instrument. There would be no Committee stage in which the measure was considered line by line. Statutory instruments cannot be amended; they have to be accented or rejected as they stand. There would be no Report stage in which new clauses could be considered. The House would have to accept the priorities of the Minister who presented the order."—[Official Report, 8 February 1994; Vol. 237, c. 158.]
  That is an exceptional power. It is a Henry VIII power. Indeed, the right hon. Gentleman described the 1994 Act as a Henry VIII Act. The power is exceptional and should be used only for the specific purpose of limiting the burden that the public sector and the Executive impose on businesses and private persons at the risk of crushing them under an increased weight of regulation. It is vital that the specific and exceptional power to remove the role of the Executive in respect of burdens on private persons should not be perverted and turned into a power that imposes on private persons an additional series of burdens without proper parliamentary scrutiny.
  Mr. White: I am confused by the hon. Gentleman. A few minutes ago, he argued that the Government had not used the powers enough, but he is now saying that we are using them too much. Which argument is he advancing? Does he believe that use of the 1994 Act should be limited, or that we should be using it far more than we are currently?
  Mr. Lansley: I apologise to the hon. Gentleman if I have confused him. My proposition is straightforward.
  38
  The 1994 Act established an exceptional power to amend large amounts of primary legislation by introducing secondary legislation, but it did so for the specific purpose of deregulation. The current Government have not used that power, although they should have done, and are now seeking to extend it not to deregulate but to impose new burdens and to give the public sector far wider powers.
  Mr.Pike rose—
  Mr.Kilfoyle rose—
  Mr. Lansley: If the hon. Member for Liverpool, Walton (Mr. Kilfoyle) will forgive me, I shall give way first to the Chairman of the Select Committee on Deregulation.
  Mr. Pike: Does the hon. Gentleman accept that, in the previous Parliament, the then Opposition recognised that the procedure worked positively and accepted that it did not have the effect that we feared during debate on the legislation? Does he further accept that there was unanimity on all 37 repealed orders, and that we did not disagree on a single one?
  Mr. Lansley: The hon. Gentleman is correct. I have no problem with that, which is why I did not suggest to the Minister for the Cabinet Office that the Labour party had executed a U-turn since the 1994 Act took effect. The point is, however, that the Act conferred a power for a deregulatory purpose. In the Opposition's view, the power should be confined to that purpose and used to achieve it as effectively as possible. It should not be extended to the wider aim of rewriting primary legislation to suit the Government, who may use it to introduce more regulation.
  Mr. Kilfoyle: The hon. Gentleman makes much of the paucity of orders under the current Administration, but does he accept that in the early days of the 1994 Act the easier targets were obviously those that went before the relevant deregulation committees? One of the lessons learned was that it became progressively more difficult under that legislation to deal with many more outstanding orders than were already being dealt with. Thus, a Bill was needed to regularise the procedure. Does he accept that that is one of the driving purposes of the Bill before us?
  Mr. Lansley: At the risk of repeating myself, I remind the hon. Gentleman that the powers provided by the 1994 Act were not increasingly less capable of being used by the previous Conservative Government before the election. Indeed, that is why I referred specifically to the year leading up to May 1997. I recall that 23 orders were presented in those 12 months and that the current Government presented only five in the following year. If the Government have used the power less since the election, it is because they do not have the necessary will.
  Mr. Stringer: We are getting to the kernel of the issue. First, does the hon. Gentleman accept that any order that is passed must have a deregulatory element? Secondly, will he acknowledge that regulatory regimes are a burden in themselves and that the 1994 Act could not deal with the issues that they create?
  Mr. Lansley: The Minister takes me to the point that I wanted to reach. We oppose the Bill in principle, but we

  39
  acknowledge that changes were made in the House of Lords. One such change requires an order made under the Bill to have a deregulatory purpose; the Government did not originally intend that. They intended that such a purpose could be placed alongside new burdens, the removal of inconsistencies and anomalies or the lifting of constraints on public sector expenditure. As long as a Minister—a Labour Minister, in the opinion of the Labour party—decides that the consequent benefit outweighs the cost, the additional burdens can greatly exceed the reduction and removal of burdens through some other provision in the order.
  Marjorie Mowlam rose—
  Mr. Lansley: Nothing in the Bill—perhaps the Minister for the Cabinet Office will tell me otherwise when she intervenes—requires a net reduction or removal of burdens as a result of an order made under it.
  Marjorie Mowlam: The hon. Gentleman suggests that every change will lead to more regulation, but some changes will decrease it. The Bill will not allow Ministers to do exactly what they want. They will have to consult the scrutiny Committees, which have a strong record of having an independent voice on deregulation. If there is any doubt, the issue can be discussed in Parliament. The hon. Gentleman tries to suggest that the Bill provides for bypassing Parliament and allows Ministers to act unilaterally; that is not the case.
  Mr. Lansley: The right hon. Lady takes us to the heart of the matter. The Conservative party does not trust the Government with such a power. At the next election, we aim to remove them. After the election, I hope that we will have a Government who have the will and the way to reduce the burden of red tape on business, instead of the current Government, who are interested in imposing additional burdens.
  A Bill is required, and I do not dispute that changes to the 1994 Act might be beneficial. However, they should be used for a specific deregulatory purpose, as our reasoned amendment makes clear, not for additional regulations or creating new burdens. We have the political will and a way to achieve that. A deregulation agency independent of Government should be established to make the regulatory impact assessment. The assessment should not be conducted subjectively inside Departments. The agency should have the power to block proposals rather than simply to offer Ministers advice on them, and to introduce measures on which Ministers have to act. Our Administration will be determined to impose regulatory budgets.
  Marjorie Mowlam rose—
  Mr. Lansley: I shall give way shortly, but the right hon. Lady will not distract me from explaining what business genuinely requires. It needs a Government who are committed to the progressive reduction of its total burden. Regulatory budgets are the only way to achieve that. The cumulative effect of the additional burdens that the Government have imposed damages our competitiveness, and we must remove them. That means
  40
  an independent audit, which leads to regulatory budgets. If additional regulations are necessary, they should be introduced through sunset clauses so that if the costs are higher or the benefits are less than predicted, the regulations can disappear. There should also be longer lead times before introducing new regulation.
  The Government's deathbed conversion after four years of regulatory excess will convince no one. The Conservative party has a commitment, a will and a way to achieve deregulation. Only the Conservative party would achieve that. We will not support the Government's desire to use the exceptional powers of the 1994 Act for the wider purposes of re-regulation, creating new burdens and giving the public sector advantages at the expense of the private sector.
  Mr. Steen: I should be grateful for my hon. Friend's elucidation of one point. The Bill has two parts: expansion of the powers of the Select Committee on Deregulation and enforcement. As I understand it, the enlargement of the Deregulation Committee's powers, which will allow all sorts of matters to be brought before it, is really a gold-plating of the Deregulation Committee. It will give it extended powers. Does my hon. Friend see that as gold-plating?
  The Bill's enforcement powers give people at local level the right of appeal to a Minister, which would bypass the legal system. If a local business was not happy with the decision of a local authority's enforcement officer, it could make an appeal directly to a Minister. Does my hon. Friend agree that that would make the Government judge and jury on such matters, and that that is another reason why the Bill is unsound?
  Mr. Lansley: It might be as well for my hon. Friend to expand on those matters if he catches your eye later, Madam Deputy Speaker.
  On the second part of the Bill to which my hon. Friend referred, I believe that, on balance, the introduction of codes of practice is not wholly a bad thing; it can be positive.
  Marjorie Mowlam rose—
  Mr. Lansley: We consider regrettable—speeches were also made to this effect in the House of Lords—the removal of any power for Ministers to use a statutory enforcement to ensure that codes of practice are complied with, if enforcement authorities fail to abide by them. [Interruption.] The hon. Member for Blyth Valley (Mr. Campbell) says that I should give way to the Minister for the Cabinet Office. I have done so several times, but as she was courteous in giving way to me, I shall give way to her again.
  Marjorie Mowlam: At last we have heard from the hon. Gentleman some of the proposals that the Opposition would introduce in place of the Bill. He suggested an independent deregulatory commission. The House would be interested to know whether that would be more costly and bureaucratic than the regulatory impact assessments that we have now. He also suggested regulatory budgets. How would he prevent that provision from becoming a new layer of complex bureaucracy, leading to further delays in introducing legislation?

  41
  The hon. Gentleman also suggested sunset regulations. That is not a new idea; we have already introduced them on two Bills. However, we believe that they should not be part of any order, but assessed on a case-by-case basis. Finally, Baroness Buscombe, on the Front Bench in the House of Lords, said on Second Reading that the Conservative party would not oppose the Bill in principle. Will the hon. Gentleman tell the House why his party's view has changed between the House of Lords and the House of Commons?
  Mr. Lansley: A number of points have been raised, and the right hon. Lady took advantage of that intervention to make a speech on the subjects, dictated by Millbank tower. She knows that it is the practice in the other place not to vote against legislation on Second Reading, and we did not. I pay tribute to the work of Baroness Buscombe and Lord Kingsland on the Bill in the House of Lords. It was their intention to secure substantial changes to the Bill, and some were made. However, it is our responsibility to examine the Bill as it is presented to the House of Commons, and we believe that it is, in principle, objectionable to extend the use of this power in the way that the Government propose.
  On Second Reading in the House of Lords, we had some hope of positive amendment. Unfortunately—such are the habits of the House of Commons—it is now incumbent on us to oppose the Bill in principle because it is our unhappy experience that the Government are deaf to good argument in the House of Commons, and unwilling to accept our arguments of principle. There is, therefore, very little likelihood of our obtaining a positive and constructive response, however we might present our argument.
  We shall oppose the Bill in principle. We shall also make it clear that, however it has been amended in the House of Lords, it remains a Bill designed to use a power intended for the specific purpose of deregulation for the wider purpose of re-regulation and the creation of new burdens. That would free up the public sector at the expense of the private sector, and do nothing to roll back the regulatory excesses of this Government. It will, therefore, fall to the Conservative party, after the next election, to introduce legislation to achieve the deregulation that business needs and desires so much.
  4.44 pm
  Mr. Peter Kilfoyle: First, let me put one or two things on the record.
  As I am sure my Front-Bench colleagues will agree, the regulatory impact unit worked hard to produce the Bill. In a remarkable variety of guises, it has done a marvellous job over a long period, under the last Administration as well as this. I also pay tribute to the work of Lord Haskins and his taskforce. Lord Haskins has never shrunk from saying things that may not have been palatable to Ministers at certain times, and he has certainly been forthright in expressing his views on the need for better regulation. My hon. Friend the Member for Burnley (Mr. Pike) and Lord Weedon of Alexander have played their part—
  Mr. Bercow: Lord Alexander of Weedon.
  Mr. Kilfoyle: I stand corrected. I am confused by titles, not least those of Members of the other place.
  42
  Those whom I have mentioned are people of character and distinction, who have worked very hard to make the Deregulation and Contracting Out Act 1994 a workable proposition.
  Mr. Bercow: I look forward to hearing the rest of the hon. Gentleman's speech, which, judging by precedent, I expect to be both interesting and entertaining.
  The reason I was so quick to intervene is that Lord Alexander of Weedon is a former resident of my constituency. He is a fine man, and Weedon is a fine village.
  Mr. Kilfoyle: I am sure that that is true, but it does not necessarily mean that Lord Alexander is a friend of the present Government in political terms, although he has worked assiduously on this issue and many others like it.
  It is all too easy to make glib, cheap political points on the back of a serious attempt, made over a long period, to turn legislation that was plainly not as workable or effective as it should have been into legislation that is workable. I have the doubtful distinction of having spent some time in the Cabinet Office working on these matters, and I was amazed at how complex and arcane they could become. I also represented the Cabinet Office on the legislation committee. Conventions relating to confidentiality prevent me from saying too much, but my role—doubtless performed by someone else now—was to act as gatekeeper in regard to legislation before it was presented to either House, and to ensure that a proper regulatory appraisal took place, including a compliance cost assessment. The process was effective in ensuring that certain pieces of legislation were altered to provide a full and transparent description of what would eventually obtain following the passage of that legislation. No doubt someone performed a similar role under the last Administration.
  At one stage, there was agreement among all parties that we needed to do much more to make legislation effective in terms of its ostensible purpose. The result, in my view, is the Bill that we are discussing now. However, as the hon. Member for South Cambridgeshire (Mr. Lansley) has illustrated, things have moved on considerably over the past four years. Not only have the Government been extremely successful, introducing many worthwhile social and economic initiatives in both Houses; the whole approach to regulation has changed.
  Initially, all references were to deregulation. When we took office in 1997, we changed the term to "better regulation". That was not an exercise in simple semantics. It sent out a strong message a la Chomsky: changing the language meant capturing the argument, which was not about taking away regulation per se but about recognising that there is good as well as bad regulation. We were intent on doing all we could, where there was a social necessity for us to do so, to ensure that regulation remained strong and enforceable, but was also understood by both individuals and businesses. By the same token, we recognised that there was superfluous legislation that was no use to man or beast, and should be removed—and we attempted to do that as well.
  As the speech of the hon. Member for South Cambridgeshire showed, there is a different agenda on the Opposition Benches nowadays. Conservative Members have adopted a very right-wing position and have moved

  43
  far out of the mainstream of traditional British politics. They believe in a minimalist state. Their soul brothers in America, the Republican party, would endorse everything that they stand for—[Interruption.] I note that the hon. Member for Buckingham (Mr. Bercow) is nodding. If they had their way, Conservative Members would remove almost every vestige of regulation.
  I am particularly concerned about the regulatory and legislative spheres that Conservative Members seem to dismiss. In this debate, I want to hear what they have to say about—
  Mr. Bercow: The hon. Gentleman will hear it.
  Mr. Kilfoyle: I am sure that I will be hearing from the hon. Gentleman and from other Conservative Members. I want to hear their comments on the types of regulation that are very important to people in this country, such as health and safety regulation. What proposals do Conservative Members have for that? I should also very much like to hear with what they propose replacing necessary legislation. I assume—[Interruption.] The hon. Member for South Cambridgeshire says that we have already heard it. What we heard was an addendum to a political diatribe on how Labour Members could not be trusted in government. Conservative Members are paranoid about proposals from Labour Members, to whom they impute base motives where none exist. Apparently, according to them, in seeking to pass the Regulatory Reform Bill, the Government are trying to circumvent the House entirely—to frustrate the will of the House. I tell them that the will of the House will be demonstrated after the next general election. I dare say that we shall all still be sitting on the same side of the House.
  Mr. White: Does my hon. Friend agree that the Deregulation Committee's procedures allow for much more extensive consultation and discussion on delegated legislation than such legislation would receive if it were dealt with under the usual procedures of the House?
  Mr. Kilfoyle: I accept that unequivocally. As I understand it—I stand to be corrected either by the Opposition or by my right hon. and hon. Friends on the Treasury Bench—there has been extensive consultation on the Bill. As I recall it, there was a draft Bill and an opportunity to resolve the issues. The hon. Member for South Cambridgeshire signally failed to substantiate his claim that no opportunity has been provided to the individuals whom he has quoted as being concerned about the Government's approach to regulation. As I think my right hon. Friend the Minister for the Cabinet Office said, Digby Jones has welcomed our initiative. As one might expect, the Local Government Association has also approved it, as have Ian Handford at the Federation of Small Businesses, and the Institute of Directors. Presumably, they have approved the initiative partly because of the Government's extensive consultation with all parties on the draft Bill.
  I can only assume that Conservative Members are opposing the Bill for broader political advantage. There is nothing wrong with that. I think that we all play that game—[Interruption.] The right hon. Member for Wokingham (Mr. Redwood) says yes. I agree with him.
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  There is nothing wrong with that. We had hoped to tackle the very real and complex problems of dealing with regulation consensually with the other parties, but if that is common cause, they have certainly not lent their support to promoting it.
  I remind Opposition Members that for every regulation that the previous Administration removed, they introduced 13 new ones. Things have not changed an awful lot in that respect. One difficulty is that we have to deal with an ever more complex world. A simplistic, minimalist approach will do nothing to cure those problems. We have to take the type of action that my right hon. Friend adumbrated in her speech. We have to ensure that people have access to transparent advice, and that they understand that something can be dealt with in just one visit, without a plethora of inspections. Those issues are being addressed in long-standing initiatives, but there are no simple, straightforward answers.
  The Bill builds upon experience and seeks when possible to improve and streamline the regulatory processes. I applaud the Bill, and I applaud my right hon. Friend's initiative in introducing it.
  4.55 pm
  Dr. Vincent Cable rose—
  Madam Deputy Speaker (Mrs. Sylvia Heal): I call Mr. Norman Baker.[Interruption.] I am sorry; I mean Dr. Vincent Cable.
  Dr. Cable: I am not sure whether that is a compliment or not, Madam Deputy Speaker.
  I start on a positive note: I welcome the fact that the Government recognise that too many of the wrong kind of regulations have been made, and propose to do something about it. However, although it took the Conservative spokesman half an hour to get round to saying so, there are serious constitutional problems with the Bill. Those are the issues that my colleagues, particularly Lord Goodhart, tried to deal with in the other place.
  To do justice to the problems, one need only look at the language that the Select Committee on Deregulation initially used about the Bill—although that language has subsequently been modified. The Committee, which I believe is all-party, expressed itself in trenchant terms about some of the potential problems with the Bill.
  For example:
  "There are few limits to the power in clause 1 of the draft Bill to amend existing legislation…The proposal could allow much of the legislative programme to be implemented by orders rather than by bills".
  The Committee goes on modestly defining its own capacity to act as a constraint on the legislation:
  "from our own standpoint we do not consider—however flattering it might be to do so—that the fact that we carry out this work to the best of our ability within the existing framework is lasting protection against the misuse of the extremely wide powers now proposed".
  That was written by an all-party group which will have the responsibility for carrying through the powers in the legislation, so there are serious constitutional problems. I sincerely hope that in what will probably be the rather short time allowed for consideration of the Bill in Committee, those issues will be properly addressed.

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  As for the substantive issues of deregulation, the hon. Member for Liverpool, Walton (Mr. Kilfoyle) put the point well when he said that regulation was neither inherently good nor inherently bad. There is good regulation and bad regulation; there is excessive and unnecessary regulation, and there is necessary regulation. It is a question of costs and benefits, and of striking a balance. There are good reasons why activity has to be regulated, such as consumer protection, environmental protection and workers' rights. Those are entirely plausible, good economic and social reasons why regulation has to exist.
  Indeed, much of the spurt in regulation occurred under the previous Government, as a consequence of privatisation. If one creates private monopolies and networks, there has to be a structure of regulation to manage them and oversee them in the social interest. Regulation is not inherently undesirable; the question is how regulation is managed.
  There has been a tendency, which is not particular to the present Government but which has accelerated while they have been in office, towards regulatory creep—a growth in regulation for undesirable reasons.
  There are three phenomena that we must try to understand. First, it is increasingly becoming the habit of Governments to regard business as a useful agent for carrying out their own policies—policies that they could have paid for and carried out themselves. For example, the working families tax credit makes businesses act as an arm of the Department of Social Security, and businesses now also have to collect repayments of student loans. Under the Regulation of Investigatory Powers Act 2000, business has to act as a spy agency for Government, without being fully compensated. That also happened under the previous Government, through the Asylum and Immigration Act 1996.
  Mr. Redwood: I am grateful to the Liberal spokesman for giving way to me, but when he talks about "regulatory creep" does he have in mind all those Liberal councils that are trying to regulate us off the roads and stop motorists using their cars? That is not so much creep as complete standstill and chaos. Does the hon. Gentleman endorse that kind of madcap regulation that stops people going about their daily lives—or do we need a Bill to stop it?
  Dr. Cable: I have a Liberal Democrat council in my area, which is introducing traffic-calming measures funded under a special scheme introduced by the right hon. Member for Suffolk, Coastal (Mr. Gummer) when he was Secretary of State for the Environment. The scheme attracted a fairly wide measure of cross-party consensus. Much of the use of business as an agent for the Government has occurred under this and the previous Government, but the trend has certainly gathered momentum.
  The second issue, to which the Chancellor of the Exchequer has contributed substantially, is tax complexity, which has been referred to on many occasions and of which the climate change levy is a good example. The levy's objectives—to reduce emissions, particularly carbon emissions—are perfectly desirable. They could have been achieved in simple ways but in fact the implementation has been very complex, with numerous exemptions. One example that was referred to me this
  46
  morning will, I am sure, eventually come to the attention of Ministers. Launderettes, which have to pay VAT on energy at the full rate—as opposed to households with washing machines—now have to pay the climate change levy as well. People who use launderettes—students in particular—tend to be relatively poor. They are being penalised in a completely arbitrary way as a result of a complex piece of legislation whose consequences were not thought through.
  The third way in which regulatory creep has occurred is through gold-plating. It is common and fashionable to blame the European Commission for some of this, but much of the gold-plating occurs in Whitehall. It occurs for complex reasons which I hope we will go into at some stage in the Bill's proceedings.
  One of those reasons is the way in which parliamentary legislation is drafted. The whole system of parliamentary draftsmanship contributes to the complexity of regulation. Another, rather important, reason is that unlike countries such as Holland or Denmark, we do not have any common ground or consensus between employers and employees. Because there is a lack of trust and of consultation, everything has to be spelled out in enormous detail.
  The working time directive serves a very admirable purpose. It is entirely desirable that workers should not be forced to work excessive hours. The difference between the British system, which I think has 75 pages of explanatory memorandum, and the Dutch system, which has one, is that in Holland it is possible for employees and employers to sit round a table and work out a modus vivendi without officials having to prescribe every detailed item of the administration.
  Mr. White: Does the hon. Gentleman also accept that in Holland the people sitting around the table can understand the language that is used, which is not interfered with by parliamentary draftsmen?
  Dr. Cable: I accept the hon. Gentleman's point, and I do not need to elaborate on it.
  Mr. Bercow: The hon. Member for Twickenham (Dr. Cable) described the working time directive as admirable. Does he accept that matters to do with the regulation of working hours are pre-eminently issues with which democratically elected members of the British legislature should preoccupy themselves, and that they are most certainly not matters for supranational authority?
  Dr. Cable: The hon. Gentleman and I probably disagree on the fundamental principle of whether the social chapter should be a national or transnational piece of legislation. However, that is incidental to my fundamental point, which is that, whatever the underlying authority, the British have chosen to implement the directive in an interventionist, messy and complex way.
  How far is it necessary to achieve the Bill's objectives through new legislation rather than in other ways? There are many ways in which the Bill's objectives could be accomplished through administrative action. For example, a fundamental problem confronting many small companies is the enormous number of inspections that have to take place. I believe that it is possible, under various statutes, for 300 different kinds of inspection by various agencies, not just the Health and Safety

  47
  Executive, to take place. That number has increased by about 50 per cent. over the past 20 years. Much trouble could be saved if small businesses had to deal with just one inspector at the Health and Safety Executive. Such an administrative change could be accomplished through Government agencies without new legislation.
  Many of the objectives of legislation could be accomplished through voluntary legislation backed up by general statute. An obvious problem, which the Government have grappled with, so far unsuccessfully, is that of cowboy builders. Most of us have constituents who have paid several thousands of pounds to have their drive tarmacked; six months later, when a large crack appears in the drive, the constituent rings the company only to discover that it has disappeared. How should we deal with cowboy builders? The problem is not a lack of competition—there will probably be 40 names listed in "Yellow Pages". The problem is that one does not know which of those people learned their trade in the local TEC and which of them learned it in the local nick. There must be a mechanism by which standards can be upheld.
  A sensible way to do that, without being over-prescriptive, would be to have the profession of builder recognised by Parliament and the detail of consumer insurance and training decided by the Federation of Master Builders or a comparable body. That could be done voluntarily, in the same way that the British Medical Association oversees the medical profession. Many of the objectives of regulation could be achieved without over-prescriptive and highly detailed legislation.
  The Bill raises major constitutional issues. My colleagues in the other place tried to address those and feel that they have helped to improve the Bill, but some issues remain. One is the lack of clarity about the organisations that can claim to suffer excessive burdens. I understand that the provision can apply to the public sector as much as to the private sector. If a Department or a local council wants to be exempted from regulations, it will be able to use the Bill in the same way as a private company. That will cause all kinds of problems that are not related to deregulation in the sense that we have been encouraged to think about it. How will the Bill prevent Departments from simply obstructing or ignoring the powers that Parliament has bestowed?
  The second issue is proportionality. The hon. Member for South Cambridgeshire (Mr. Lansley) has already made the point that regulations give rise to issues of cost and benefit. We must ask whether the additional burdens of regulation or, in some cases, deregulation are offset by compensating benefits. How will that balance be measured? How will costs and benefits be defined in the Bill? In the other place, an attempt was made to encompass the idea of "desirability", although I am not entirely sure how that common-sense word can be used in a legal context.
  The third and most important point is how we prevent large, controversial measures being introduced under cover of the Bill. Clearly, many small changes, such as the 50 listed by the Minister for the Cabinet Office may well be highly appropriate, but who will define what measures are controversial? How will a limit be set so that the Bill is not abused?
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  I accept that in many cases regulation is necessary and desirable for environmental and social purposes. However, we must ask whether it is necessary, what burdens it imposes and what its costs and benefits are. If the Bill provided a workmanlike mechanism for reducing excessive legislation, I would welcome it. but I suspect that it contains hidden constitutional traps about which we need reassurance.
  5.8 pm
  Mr. Peter L. Pike: I am glad to have the opportunity to speak in the debate and I certainly support the Bill. It is an important step in enabling us to introduce more deregulation and to tackle many of the problems found by the Deregulation Committee since its inception, following the introduction of the Deregulation and Contracting Out Act 1994.
  I was very disappointed by the speech of the hon. Member for South Cambridgeshire (Mr. Lansley), particularly in view of the fact that in the other place the Bill was not opposed, even at its final stage. I understand his argument that, traditionally, the Lords do not vote against Second Reading and that they try to scrutinise and improve legislation. However, having done so with some measure of success and having amended the Bill, they accepted it and sent it to this House to be debated and scrutinised in accordance with the normal procedure.
  Having read the Opposition amendment, I am concerned that their view is that the Bill
  "fails to apply sufficient consultative, scrutiny and review provisions".
  That is absolute nonsense, and it fails to recognise what has happened since the passing of the 1994 Act. That failure can be traced back to our reasons for opposing the Act: we were outraged by it and said that it was Henry VIII legislation under which Parliament's ability to debate proposals made under the Bill would be bypassed. However, when the Act was implemented, we on the Deregulation Committee found that that was not the case. Indeed, everybody has found that the proposals have resulted in deregulatory measures being dealt with in such a way as to be subject to better consultation and better scrutiny. The procedure is better than tagging measures on to big Bills.
  Some Departments and their officials perhaps have not made more use of the legislation because they fear that the scrutiny and treatment of proposals would be much more rigorous, and on several occasions the Committee has sent proposals back to the Home Office. I held the position of Vice-Chairman and the Chairman was Barry Field, who was the Member for Isle of Wight. We met Ministers and officials to give them a severe dressing down, because we felt that some proposals were not being dealt with in accordance with the 1994 Act.
  Mr. Lansley: It is no criticism of the hon. Gentleman's Committee that the Government have not chosen to put orders before it, nor is the reasoned amendment a criticism of the scrutiny carried out by that Committee. It is a criticism of the Bill.
  We believe that the Bill is inadequate because the proposed consultation outside Parliament is inadequate. Scrutiny is also inadequate because of the limits on the nature of the material to be provided in the document to be laid before Parliament; and notwithstanding what the

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  Minister of State, Cabinet Office in the other place said, the review of the overall effects of the legislation and of the extent to which it should continue to be used is inadequate too.
  Mr. Pike: I understand what the hon Gentleman says, but his remarks are misjudged and give a mistaken impression of the Bill. However, we are debating that matter here and there will be further debate in Committee.
  The hon. Gentleman's view is that the Bill will add to regulation, not deregulation. Importantly, however, two main changes dealing specifically with that point were made in the other place, and such matters were of concern both to the Deregulation Committee and to its opposite number in the other place and Lord Alexander of Weedon, its Chairman. There is excellent liaison between the Committees and their members maintain a good relationship—they know what we are doing, we know what they are doing and the two Chairmen correspond. Although we do not always exactly agree, we try to work together to ensure that we are doing the job that we are there to do.
  In all fairness to my hon. Friend the Parliamentary Secretary, Cabinet Office, who will make the winding-up speech, he told the Committee that the Government, after further consideration, would accept amendments in the other place to change and improve the balance between regulation and deregulation, and we were glad to hear that. As a result, amendments were made in clause 1 to introduce a major restraint; it is now essential that provision must be included so as to reduce or remove burdens. There will therefore be a balance, so that the main purpose is the consideration of such reduction or removal. That point is extremely important.
  Clause 3 was amended to prevent new burdens, unless a Minister is satisfied that there has been an overall reduction of the burden or that there are
  "other beneficial effects for persons affected"
  In the view of the Committee, those amendments meet many of the earlier criticisms of the draft Bill.
  There has been no example of a better scrutinised draft Bill. There has never been better liaison between the Department that produced the Bill and the Committee that considered it in draft. A consultation paper was issued. The Committee made known its views to the Government. They responded, and the Committee replied to that response. We then considered the draft Bill. There has been every opportunity to express our views.
  There may not have been 100 per cent. agreement with every provision, but the Government have moved a long way and have taken cognisance of the constructive proposals made by the Deregulation Committee. Indeed, last week we produced our first special report of this Session—"The Handling of Regulatory Reform Orders". That follows the publication of a report by the Lords Committee after the completion of the Bill's passage through that place.
  I am the only Member who has been on the Committee since it was established—I joined it on day one—and I am not sure whether that is a reward or a punishment. I have chaired the Committee since 1997.
  The hon. Member for Totnes (Mr. Steen) referred to the number of proposals that the Committee had considered before the last general election. However, most
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  of them were of little importance; they generally dealt with measures on gambling and bingo. Indeed, the first proposal that we dealt with was for the reform of betting on greyhound racing, allowing people to bet on the Tote—off the track. The Committee visited Walthamstow race track to see what the proposal involved. We had a meal there and were told which dog would win the last race. Disappointingly, it did not, so deregulation certainly did not guarantee the Committee a winner.
  At one point, I even asked a parliamentary question asking whether our Committee was a deregulation Committee or a gambling and bingo Committee, because most of the measures that we dealt with before the election were on precisely those matters.
  All along, the Committee has said that it is time there was some uniformity of age as regards soft gambling—for bingo, lottery tickets and so on. We have still not achieved that, so there is more to be done.
  The most important measure that we dealt with was one that most people would not even notice—banks and cheque truncation. That measure was to be implemented in two stages—I am not sure whether the second has been fully implemented—and it means that when a cheque is paid into one branch it does not have to go back to the branch where it originated. In these days of modern technology, it was nonsense for millions of cheques to move around the country every day. That must have cost financial institutions—and, ultimately, their customers—a great deal of money.
  Our original fears about how the legislation and the Select Committee would work very soon proved totally unfounded. As I said in an earlier intervention, we did our job strictly as any Select Committee would do. At the end of the day, after a lot of debate and discussion on some issues, we reached unanimous decisions on every item that we considered before the election. Indeed, in all our time as a Committee, we have divided on only one measure. We did so after the election, on a measure about which the employers and the trade unions agreed, involving a change in the trade union check-off provisions—but the Opposition decided to vote against the proposal at the last minute.
  The Committee already provides good scrutiny. It is a good system; it has been proved to work, and good consultation is tied up with it. There is a good procedure of reporting to the House and debating any matter on which the Committee divides. Indeed, the House had to debate the check-off provisions because the Committee had divided on them. That was totally different from the procedure of European Standing Committees A and B when they were set up. They could amend a Government motion, but the Government could still table the original motion in the Chamber, and the House would have to agree to it without debate, forthwith. That is nonsensical, because the fact that a Committee has amended a motion should be reported to the House. Of course the Government always have the right to reamend the motion so that it states what they originally wanted. When I was a member of European Standing Committee A, I thought it nonsense that its proposals could be totally ignored and a motion different from the one agreed could be tabled in the Chamber, and agreed with a Division, if necessary, but without debate. So the Select Committee's procedure is good.

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  Right from the day after the general election, when I became Chairman of the Select Committee, its view and that of all my hon. Friends has been that it has not had enough business. The Committee has been disappointed about that and has tried to ensure that more proposals come before it. Indeed, we have met every Minister who has been involved, and they share our concern; they also want more proposals to go before the Committee.[Interruption.] The right hon. Member for Wokingham (Mr. Redwood) laughs, but that happens to be true.
  The Labour party is in favour of doing something, but the participation of Conservative Members on the Committee has been almost nil. The hon. Member for Weston-super-Mare (Mr. Cotter) nods, because he has taken a full part in the proceedings from the Liberal Democrat Benches. Indeed, I wrote to the Conservative Chief Whip, because the Committee was extremely worried that the Conservative Members were not taking part in its proceedings. One Member no longer wants to be a member of the Committee, but has not been replaced to this day. So, far from being advocates and campaigners for deregulation, the Tories have been backward in that work.
  The then Chancellor of the Duchy of Lancaster, my right hon. Friend the Member for South Shields (Dr. Clark), was concerned from the start. Indeed, we looked at the position, and it was agreed at a fairly early date that a consultation paper should be issued. Unfortunately, that was not done as speedily as one would have hoped, but it was ultimately issued. I met my hon. Friend the Member for Knowsley, North and Sefton, East (Mr. Howarth), when he was the Minister dealing with deregulation issues, and he too was anxious that we should increase the Committee's work load and encourage more Departments to put matters before it.
  One of the effects of the Committee's not having enough work is that its staffing has been reduced—not in calibre, but certainly in number. That point must be addressed if the Bill makes progress and if the Committee's work load increases.
  The Committee called my right hon. Friend the Member for South Shields to give evidence and we had a good evidence-taking session. The chairman of the better regulation taskforce, Lord Haskins, also came before us to give evidence and the Committee produced a report.
  When my right hon. Friend the Member for South Shields was replaced, my right hon. Friend the Member for Copeland (Dr. Cunningham) took responsibility for deregulation. He was also concerned about the position, as was my hon. Friend the Member for Liverpool, Walton (Mr. Kilfoyle), and the latter came before the Committee before this Bill was introduced. The Bill is a result of all the steps that have been taken over the years, so it is important to examine how we reached this stage.
  The Committee considered the possibility of a Bill and published a report. In due course, a draft Bill was introduced; my hon. Friend the Parliamentary Secretary, Cabinet Office appeared before the Committee and we considered the draft Bill in a useful evidence-taking session. In May 2000, the Committee published its second special report. The Government considered the report and produced their response and, quite rightly, the Committee examined their views. We did not agree with everything
  52
  that the Government had said, so we produced our third special report outlining a few points that we wanted the Government to note.
  When the Bill was introduced, it was clear that the Government had not taken account of everything that the Committee had said, but some of our key points have since been accepted. Amendments made in the other place take the Bill very much nearer to what the Committee wanted, and we welcome the positive approach that the Government have adopted. They have not taken a rigid view and they have been willing to consider other views and accept improvements to the Bill. I and my Committee welcome that.
  Mr. Brian Cotter: Does the hon. Gentleman not agree that the Committee was a little concerned by the Government's lack of commitment to an annual review of the Bill's operation? It is an important Bill, and although the Committee said that it would carry out an annual review, does the hon. Gentleman agree that it would be far better if it were carried out far more publicly by the Government?
  Mr. Pike: The hon. Gentleman makes an important point; I was going to touch on it in my speech. It is clear that the Committee was not 100 per cent. happy with what the Government said. The latter have moved and said that they will carry out a review after three years to see how the Bill is working. That review will be published and debated, but the Committee has made it clear that it intends to produce an annual report. That is legitimate. I do not know who will sit on the Committee after the general election or who will chair it—the new Committee may take a different view. However, I hope that it will take note of our reports.
  The Government are aware of the differing views. Indeed, I spoke to the Parliamentary Secretary about them in the Division Lobby and mentioned them to him last week when we had finalised our report. They are not confidential. The Committee has a right to its opinion, which I accept is slightly different.
  The other place amended the Bill. It is now closer to what the Committee wanted. We certainly welcome that. Assuming that the Bi11 receives early approval and Royal Assent, the Government must act speedily to ensure that it is implemented. Initially, the measures will be contained in two pieces of legislation—the Deregulation and Contracting Out Act 1994 and the new Act. I understand that the Government intend to introduce three proposals next week, which I shall deal with shortly. The measures to which my right hon. Friend the Minister referred are being consulted on and will be part of the new legislation.
  I have touched on staffing resources. That will need to be dealt with speedily so that the Committee can carry out its work efficiently. We have always been served by excellent Officers of the House, but we will need sufficient staff to cope with the amount of work. My right hon. Friend mentioned some of the matters with which the Committee might have to deal. Indeed, they are listed in an annexe to the Committee's first special report which was published last week. They are a response to a parliamentary question asked by my hon. Friend the Member for Harrow, West (Mr. Thomas) and they relate to issues that the Government have every intention of addressing at an early date.
  Mr. Lansley: The hon. Gentleman mentions the Committee's regret at the paucity of deregulation proposals that it received. Has it had an opportunity to consider the 51 proposals that have been mentioned by Ministers in relation to the new power and examined whether, and to what extent, those could have been introduced as part of the 1994 Act?
  Mr. Pike: We have not done that; perhaps we should have. However, the list has now been published.
  We have spelled out our opinion on producing reports. It is an extremely important job. I am sure that the Parliamentary Secretary will recognise that the report makes it clear that we intend to conduct an annual review. If need be, the Committee will call a Minister to give evidence. That could be the Minister with responsibility for deregulation or a departmental Minister. We have the power to do that and to consider particular failings. We may, of course, decide that the Government are doing an extremely good job and are giving us too much work to do in the new Parliament.
  I am sure that my hon. Friend the Member for Milton Keynes, North-East (Mr. White) will want to refer at great length to paragraph 13 of our report. It reiterates the need
  "to produce legislation comprehensible to those affected by it".
  However, the Government have not included such a provision in the Bill. The report continues:
  "If the Bill is not amended to this effect" —
  let us assume for the moment that it will not be—
  "we (and, we trust, our successors) will nonetheless scrutinise all future proposals and draft Orders with these objectives in mind, and will expect Ministers to do the same."
  I hope that Ministers will take note of that. Reference has been made to legislation in Holland. We want to have legislation in this country that is clear and understandable. My hon. Friend the Member for Milton Keynes, North-East has pursued that issue both in the Committee and in the Chamber, but he is not the only one who is concerned: many hon. Members on both sides are concerned about it.
  Three proposals are to be tabled next week. It is important that Ministers recognise that, once they have been tabled, the Committee clock starts to tick. We have a specific number of days in which to consider the proposals: all days count, including weekends, unless the House is not sitting for more than four days; therefore the timetable stops for the duration of an election, but restarts on day one of the new Session. I mention that because it means that the Committee must be established with all possible speed after the general election if it is to be able to carry out its responsibilities under the Bill.
  The first special report also proposes a new name for the Committee and provides some draft Standing Orders. Our attitude to our draft Standing Orders is not rigid; we have published them to provide helpful guidelines, in the hope that they will be taken into account by those responsible for formulating Standing Orders, as they too will be required fairly speedily if the Committee is to carry out its work. We propose that the Committee's name become "the Deregulation and Regulatory Reform Committee",
  because we believe that "the Deregulation Committee" will not adequately describe the work of the new body.
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  I welcome the Bill as a move in the right direction. The 1994 Act has proved too tight and too rigid for the amount of work.
  Mr. Lansley: I should be interested to hear the Committee's and the hon. Gentleman's personal view on precisely what is too tight in the provisions of the Deregulation and Contracting Out Act. The comments of the Minister for the Cabinet Office suggest that if the purpose is deregulation, the only real restriction is imposed by section 1(5)(c) of that Act, which limits the measures to which orders can be applied to those that were enacted in Sessions up to and including the 1994–95 Session. Would it not have been simpler to amend that provision than to engage in a wholesale extension of the power?
  Mr. Pike: I do not accept that view. It is unfortunate that the hon. Gentleman appears not to have listened to the opening speech made by my right hon. Friend the Minister for the Cabinet Office, and that Conservative Members did not take part in scrutinising the Bill. The second special report of the 1999–2000 Session addresses those very issues, as does the previous report. Anyone who becomes a member of the Committee on the Bill will, during the few days available to that Committee, find the Deregulation Committee's reports an extremely useful aid to constructive debate on the legislation.
  Before I gave way, I was making the point that the Bill will open the door to more deregulation. Finally, to answer the hon. Member for South Cambridgeshire, from day one the Committee found that one cannot deregulate without putting some other regulation in place. We want sensible, workable and better regulation, and the Government have tried to achieve that. We all want to remove unnecessary bureaucratic regulation that serves no useful purpose. Even when the Committee was under the chairmanship of my predecessor and had a Conservative majority, almost every time we looked at a proposal, we found that we had to replace deregulation with something else to make the system safe and secure, and protect those from whom we were trying to remove burdens.
  I fully support the Bill; I shall certainly vote for it and against the reasoned amendment at the end of our debate.
  5.40 pm
  Mr. John Redwood: I have declared my interests in the register.
  What a sad testimony we have just heard from the hon. Member for Burnley (Mr. Pike), the Chairman of a Committee that once rejoiced in the title of the Deregulation Committee. I am delighted that he was so honest because one thing became crystal clear in his long narrative: the Government do not believe in deregulation. They are not at all apologetic for the massive increase in regulation in their four years in office. They have left the Committee entirely devoid of purpose. We saw a rather pathetic image of members of a Commons Committee sitting around having meetings and writing letters to members of a Lords Committee, who were also sitting around having meetings, because they had nothing else to do, and wondering if they could have more meetings together.
  Mr. Ian Stewart rose—
  Mr. Redwood: I should like to make one little point, but shall then be delighted to give way.

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  We then heard that if there were a serious chance of any deregulation emerging, the Committee would need a massive increase in staffing because, poor things, its members were already enormously overworked. The only argument against the Conservatives was that some of them did not always turn up. I am not surprised, given that the Committee was boring and did nothing; I am sure that my hon. Friends had better things to do with their time.
  Mr. Stewart: If boredom is the criterion to which we pay attention, I fear that many Labour Members would leave every time that the right hon. Gentleman stood up to speak. However, on a serious note, if a Commons Committee has concerns and wishes to share them with a Committee in the other place, it would be appropriate for the right hon. Gentleman's team to be in Committee to add its voice. Conservative Members were not in Committee and they did nothing; the country knows that.
  Mr. Redwood: For four years, the Conservative team has put across strenuously and consistently the message that the Government are over-regulating, not deregulating. My right hon. and hon. Friends on, and beyond, the Committee would willingly give of their time to work on serious deregulation. The truth is the Government have no interest in that and have no proposals.
  Today, we heard the Chairman of the Deregulation Committee make one serious proposal to the House: the Committee should be renamed—and, no doubt, rebranded with a new logo at considerable expense to the taxpayer—thus letting the secret out to the world at large that it cannot deregulate, does not want to deregulate, does not know how to deregulate and has no idea why it should deregulate. Instead, it would like to join in the game of more regulation, more cost, more burdens, more trouble, always putting more impositions on the private sector in the naive belief that there will never be another bust when all around is plenty of evidence of plenty of busts in plenty of sectors.
  Mr. Cotter: Does the right hon. Gentleman genuinely think that rhetoric is a replacement for action? We have heard a lot of rhetoric from Conservative Members. When the Tory Government were in power they introduced as much legislation as the present Government—indeed, possibly more. May I emphasis the point that Conservative Members did not attend the Committee at the very point when they could have influenced the Bill? They had an opportunity to discuss it. They are wasting time talking about getting deregulation when they had a chance to influence things. To stand here talking is rhetoric, not action.
  Mr. Redwood: I thought that speaking in the House of Commons was a great privilege, and that speaking in the House about policies might persuade the Government to do something sensible. Earlier, I heard my hon. Friend the Member for South Cambridgeshire (Mr. Lansley), the shadow Cabinet Office Minister, make three proposals about a process for deregulation rather more sensible than the mean and difficult proposals in the Bill, which will undoubtedly backfire.
  The Bill has "3 May is election day" written all over it. The Government do not seriously expect to get the legislation through or to do any real deregulation, but
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  clearly, the runes have been consulted, the focus groups have been paid off, the polls have been plumbed, the Government have taken all sorts of factors into account, and they have discovered something that we have been telling them for four years: that the business community feels that it is massively overregulated.
  Much of that overregulation has taken place under the present Government—[Interruption.] The Liberals, in the form of the hon Member for Weston-super-Mare (Mr. Cotter), are leaving the Chamber because they know that they are partly guilty, as the junior coalition partners. The regulations have built up massively under the Government. The business community does not like that. The famous peace or truce—
  Mr. Ian Stewart: Will the right hon. Gentleman give way?
  Mr. Redwood: I shall give way in a moment. I should like to finish the point, then I shall be happy for the hon. Gentleman to have another shy. It will not work either, but we are always willing to encourage talent, if only we could find some on the Government Benches.
  Too much regulation is being built up by this Administration. The business community no longer thinks that the Government are friendly to business, so they are in pre-election panic mode. The Cabinet Office has been asked to produce something that the Government can spin to persuade business that after four years of getting it wrong, they will get it right. The Government want the British people and the British business community to sign a blank cheque. The Government say, "Trust us. We now understand that deregulation is important."
  Mr. Stewart: I thank the right hon. Gentleman again for his courtesy in giving way. It may surprise him to hear that I understand and accept his protestations on behalf of private industry. However, it would be good to hear from him and other Opposition Members some protestation about sensible, appropriate and relevant regulation and how it protects workers.
  Mr. Redwood: I hope to give examples of measures that the Government have imposed that I should like removed, as they are totally unnecessary burdens. The Conservative party has always supported sensible regulation for employee conditions, and we are not proposing to scrap worthwhile protections for employees. It is a matter of balance and degree. An avalanche of regulation and taxation has been thrust at businesses. A £10 billion regulatory burden and a taxation burden of more than twice that sum have been added by this Administration. That is becoming the straw that breaks many camels' backs throughout British business.
  No wonder the Government want a general election on 3 May. It will not be long before all that comes home to people. Businesses will go bankrupt, businesses will shed labour, entire industries will get into worse trouble, and much of it will be the direct responsibility of Ministers and Labour Members, who willingly imposed tax after tax and regulation after regulation, to cause those troubles.
  Mr. Pike: When the right hon. Gentleman went to the Back Benches after losing the leadership election in the

  57
  previous Parliament, did he vote against all the additional tax burdens that the Conservative Government forced on business?
  Mr. Redwood: If the hon. Gentleman looks at the record, he will see that I produced a number of alternative proposals for less tax and less government. I have gone on to support an Opposition who clearly want to lower the tax burden, compared with the Government's very high one. That, surely, is the position of a sensible person who wants to make the case for a more prosperous country.
  I draw to the attention of the House a particular concern, in the light of the extraordinary clause 9, which deals with enforcement practice. Clause 9(1)(b) states:
  "the practice followed by enforcement officers in relation to the enforcement of the restriction, requirement or condition ought to be improved so far as fairness, transparency and consistency are concerned".
  Seemingly, the Bill sets out the need for a code of practice to try to improve the way in which Ministers regulate. I would be delighted if Ministers regulated more fairly, transparently and consistently, but it is extraordinary that they need to introduce a Bill to allow the House to impose on them a requirement to set out enforceable standards of conduct. Why are not sensible enforcement procedures already in place, and why do Ministers need legislative permission to introduce codes of practice that they could issue anyway?
  Mr. Fabricant: My right hon. I Friend speculated on why the Government are so keen to have the general election on 3 May. I suggest that it is because they know that the Bill is unenforceable. He referred to clause 9(1)(b). Does he realise that any clause that provides that a standard "ought to be" enforced is unenforceable in practice?
  Mr. Redwood: That may be the case, but my criticism of the Government is that they try to introduce so much legislation that is half-baked, ill-thought-out and inconsistent, and that lacks transparency. Furthermore, they keep changing their minds.
  One of the farmers in my constituency, Mr. Russell Butler, has a large number of sheep in fields that range over a 70-mile area. Last week, he needed to move the animals, but he came up against bad Ministry of Agriculture, Fisheries and Food regulation. Presumably, it was exactly the sort of regulation that clause 9 is supposed to tackle, but we cannot wait for that measure to take effect. The Minister of Agriculture should deal with the problem today. Mr. Butler asked for permission to move his sheep, which, I am pleased to say, are nowhere near a confirmed outbreak of foot and mouth disease. He was told that he could not move them more than 5 km because of the regulations that were extant last week. He needed to move them over a greater distance, because his fields are spread out over a large area. The sheep on his grass were getting into considerable trouble. It is lambing season and he wanted to return them to the farm for the lambing to occur properly. Even if he had to leave them
  58
  out in fields, he wanted them to have grass to eat. The fields in which they had remained were getting muddy and the grass had worn out. Some of the fields—
  Madam Deputy Speaker: Order. I hope that the right hon. Gentleman will return fairly quickly to his point about regulation.
  Mr. Redwood: I am trying to illustrate the problem with clause 9 by citing a clear example of legislation that is muddled and lacks transparency. Perhaps a stronger measure than a code of practice is needed, but we cannot afford to wait for primary legislation, and my constituent, Mr. Butler, would obviously like to know that the matter is being taken seriously by Ministers and the House.
  Mr. Butler applied for information on whether there was anything else he could do. He was then told that the regulation would be changed during the week and that he could obtain a movement order because the restricted distance was to be changed to 15 km. He was told that the change would occur on Tuesday. I then intervened personally, as he wanted to move the sheep 15 miles and not 15 km. Subsequently, however, he was telephoned and told that he could kill all the sheep, even though they were perfectly healthy. He was assured that a licence would be granted for that purpose. Of course, that worried him considerably and caused me enormous concern. Before I had to intervene again, however, I was telephoned with an entirely different story. I was told that some time during the week, on an unspecified date, MAFF would lift any limit on the distance of movement for farmers in unaffected areas. In effect, I was told that my constituent could hang on in the hope that the regulation would be changed, although his sheep would probably starve to death on muddy fields in the meantime.
  I hope that you can see, Madam Deputy Speaker, that that example deals with a point that is central to the Bill, as it demonstrates muddle, incompetence and lack of transparency. It also shows the lack of decent feeling for animals that could die because Ministers do not see—
  Madam Deputy Speaker: Order. The right hon. Gentleman can give an example, but as I have pointed out, he must return to the principle of deregulation.
  Mr. Redwood: I am happy to do so, Madam Deputy Speaker.
  Clause 9 states that enforcement should be fair, transparent and consistent. I agree with those aims, but why is such provision needed? Surely those conditions should apply now. Why should we introduce a Bill to make Ministers behave transparently and consistently, when that is how they should behave now? What is wrong with them? Why do they have to rely on the Minister for the Cabinet Office—one of the less dangerous people among them—to introduce the Bill? They are introducing legislation in the hope that, if they stay in government, they will at some stage introduce codes of conduct on regulation. However, we have seen in all too many instances that they have no idea how to regulate sensibly, how to be open and honest or how to leave people sure of what is required.
  I have spoken about agriculture and I shall not bore the House with more examples. Business men and farmers want fair, proportionate regulation. They want to know

  59
  why it was arrived at and what they need to do to comply with it. How can a farmer comply with a regulation when he is given three different versions of what he should do? Should he kill his animals, or wait in the hope that he can move them a shorter or a longer distance? We need immediate action on such issues.
  Mr. Bercow: Does my right hon. Friend agree that the explanation of the Government's appalling failure on regulation can be found in the two characteristics that the six Department of Trade and Industry Ministers and three Cabinet Office Ministers in the House have in common? First, none of them has ever run a business or worked in one, and, secondly, they are all fanatical European "federasts".
  Mr. Redwood: My hon. Friend makes a powerful point.
  Marjorie Mowlam: Let me take the right hon. Gentleman back to the nature of the Bill. He spoke about lack of consultation, but there has been unprecedented pre-legislative scrutiny. The draft Bill was published last October and was the subject of extensive consultation. He said that it was a last-minute measure, but that is patently incorrect. He suggested that the provisions had not been costed, but they have been, in comparison with his Government's costings. The hon. Member for South Cambridgeshire (Mr. Lansley) spoke about an independent deregulatory commission and a regulatory budget without telling us why his proposals would not create greater budgetary and administrative costs. It would be useful if the right hon. Gentleman could describe such costs in his meandering speech.
  Mr. Redwood: I think that the Minister wanted to intervene on my hon. Friend the Member for South Cambridgeshire, as her points relate to his speech rather than to mine. I gave way to her because I always do so if time permits, and I hoped that she would feel like defending the Government or would have something better to offer to my constituent and to the many farmers throughout the country who want proper regulation. The Bill concerns not only deregulation, but better regulation. Indeed, the main burden of the provisions is amendment of the 1994 Act to allow the Government to use similar powers to increase regulation, rather than diminish it.
  Mr. Stringer: Does the right hon. Gentleman accept that the clause 9 provision to which he referred is lifted word for word from the 1994 Act, which he supported when he was a Cabinet Minister? Why does he not support that measure now?
  Mr. Redwood: I have made it clear that I fully support the Bill's principles in that regard, but why is the Bill needed to achieve what should be happening now? When we consider the chaos and confusion caused by lousy regulation in agriculture, we are desperate for an immediate solution. We need to know how many animals must be killed and why. If the Government have settled on such a policy, we need to know whether the killing can be carried out more quickly, so that the risk can be reduced, rather than increased.
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  Those are today's anxieties in respect of better regulation, but the Bill does not sort them out. I do not challenge the principles of regulatory reform. As the Parliamentary Secretary said, I supported those principles—fairness, transparency and consistency—in 1994, and I still support them today, but I want action, rather than more words on a piece of paper that is merely a pre-election stunt that demonstrates no understanding of the seriousness of what is occurring in the countryside or in businesses elsewhere
  I should like to move away from agriculture and clause 9, and consider earlier clauses.
  Mr. Edward Leigh: Does my right hon. Friend agree that, when we consider suffering farmers or business men who are burdened with over-regulation, the primary problem is not the regulation but incompetence? The countryside is especially affected by the incompetence of Ministers and managers. The Government are saying that the ship is heading towards the rocks and that we must therefore give it a complete refit and change the engines when we need to change the officers on the bridge. That is all we need to do to help farmers.
  Mr. Redwood: My hon. Friend makes an important point. He represents many more farmers than me, and he speaks with feeling and understanding from experience. He could also have said that many abattoirs were killed off by regulation, much of it from the European Union. The Government did not oppose it, and they are paying a high price in agriculture, partly because the closure of many smaller abattoirs requires more movements over long distances. I do not claim that that caused the outbreak, but it has made its spread more rapid and more difficult to contain.
  If we consider the number of businesses that are desperate for proper deregulation, we can understand why so many people will believe that the Bill is not man enough for the task. Let us consider fishing. Our industry is being killed off by common fisheries policy regulation, whose purpose seems to be to ensure that cuts in catch and quota are borne mainly by British fishing vessels to enable Spaniards and others to take the catch.
  Why do not the Government deregulate our fishing industry and press for re-regulation of the foreign fishing industry to change the balance? That is what our fishermen want. They understand the need for some overall controls, but sensible ones, not flinging dead fish back into the sea and believing that that will transform the position. They would like a fairer system that gives them more chances and the foreign vessels commensurately fewer.
  Mr. Mark Hendrick: The previous Government signed the common fisheries policy, which largely led to the current position. The Government have done much to reform it. Also, the number of abattoirs more than halved in the two years before the Government came to office. The rural White Paper, which was published in November last year, pledged £8.7 million for abattoirs.
  Mr. Redwood: My constituents do not recognise the world that the hon. Gentleman describes. In their world,

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  European regulation considerably damages the industries that are most affected by it, and a supine Government provide soundbites about being at the heart of Europe and getting on frightfully well with our partners, while being unable to challenge them about anything or stand up for British fishing or agriculture. That has led to the most murderous reductions ever—and there have been all too many over the years—in the British industry's catches. If British fishing is to have a future, we need a Government who believe in the right sort of regulation and deregulation.
  The Bill will not help. I cannot go to a fishing village on my travels and say, "Great news. I was in the House of Commons on a marvellous occasion. We had a debate during which Ministers at last realised that European regulation is smashing the fishing industry, and they have introduced a measure to get regulation right." Ministers do not care; they do not even admit that there is a problem. Government Back Benchers are prepared to make foolish points, which will read badly in dwindling fishing communities around our coast.
  There is also the meltdown in telecommunications. Share prices have crashed and we have heard announcements that that glamorous and growing industry is about to suffer job losses on a big scale. That process began when the Chancellor of the Exchequer imposed a windfall tax of £22 billion on that successful industry. He perceived no irony in saying simultaneously that he would impose a massive licensing, tax and regulatory bill on the industry and that there could be a new economy with a faster growth rate. He said that there was a new paradigm, led by telecommunications and the dotcom revolution. He believed that it was a great idea to tax the industry to a dangerous extent. Now a bitter harvest is being reaped. The Germans foolishly followed that example; over-regulation took £50 billion out of a lead industry. That has led to difficult consequences in stock markets and telecommunications throughout the European Union.
  Mr. White: Will the right hon. Gentleman explain why he was elected in 1997 on a manifesto that supported the action that he has outlined?
  Mr. Redwood: I did not recommend that policy. I made a speech in the House explaining the difficulty. The Conservative party would not have modelled it as mathematically brilliantly as did the Government, who optimised the take and ensured that businesses were left short of cash and unable to make the investment in the next generation of technology as quickly as they should. I pay full tribute to the Chancellor's ability to take the right advice from a mathematical professor, and to ensure that he took most of the money and left nothing for new investment and new ideas. However that is not a success but a great failure.
  Mr. Hendrick: Will the right hon. Gentleman give way?
  Mr. Redwood: Willingly—perhaps the hon. Gentleman can do better than his previous intervention.
  Mr. Hendrick: Does not the right hon. Gentleman accept that the halving of the value on the Nasdaq exchange in New York has much to do with profit
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  warnings by major American multinationals and little to do with the Government's sale of the spectrum, which brought so much money to the Exchequer?
  Mr. Redwood: I am talking about the United Kingdom. That is our country, where I have a constituency and represent people. The combined impact of the British and German auction is a major factor in the collapse of telecommunications share prices in Britain. As I explained, the German auction was modelled on the British version. Cannot the hon. Gentleman understand that if a Government suddenly take £5 billion from the main participants in a successful growing industry that leads an economy, its growth will be damaged? The crucial companies in Britain were affected by that.
  John Robertson: As I worked in telecommunications for 30 years, I know a wee bit about it. BT has made exorbitant profits and given them to shareholders for many years. It has not invested them properly, and that has now come home to roost. The telecommunications industry—or the communications industry, as it likes to call itself nowadays—has been affected by the global market. That has nothing to do with Britain and the Government. More people are employed in telecommunications than before. Would you not agree—
  Mr. Deputy Speaker (Mr. Michael Lord): Order. First, the hon. Gentleman's intervention is too long. Secondly, he is not using the correct parliamentary language. He has had long enough for his intervention.
  Mr. Redwood: My case stands. The British Government, followed by the German Government, took huge sums from the leading telecommunications companies in this country. Massive over-regulation and the sale of licences when the public sector had a monopoly stranglehold on marginal spectrum is the important issue. That has done enormous damage. The hon. Gentleman can argue until he is blue in the face, but he should watch what happens next. More redundancies will occur—
  Mr. Deputy Speaker: Order. The right hon. Gentleman is going rather wide of the mark. We are getting into a general history of financial affairs in recent years. Will he please return to the Bill?
  Mr. Redwood: I am happy to do that.
  The Bill does not offer the sort of deregulation that industry desperately needs. Over-licensing and over-expensive regulation of the telecommunications industry is an example that the Government will not tackle.
  Mr. Lansley: Does my right hon. Friend agree that one of the consequences of the Government's policy on the telecommunications industry is that it has left them unable to pursue the extent of deregulation required by the introduction of full competitive pressures, especially on local loop unbundling, that would appeal to a broader business interest in stimulating broad-band access? The Government's desire for additional revenue and their propensity for regulation are intimately connected.
  Mr. Redwood: I quite agree, and I notice that there is nothing to tackle that problem on the list of 51 varieties of possible deregulation. There is a case for the right

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  kind of additional deregulation in telecommunications. Although that would not offset the massive tax burden, it would at least send a signal that the Government have not lost all interest in and enthusiasm for such a leading sector. However, I see from the rather blank looks on ministerial faces that we are not going to get that.
  Another area in which I would like further deregulation—which I am pleased to see that the Conservative party has pledged to achieve as soon as it has regained power—is IR35 regulation of the computer industry. That is another important lead industry alongside telecommunications. If the new revolution was about anything, it was about the application of telecoms, dotcoms and computing to create exciting new economic developments. What did the Government do? They smashed not only the telecoms industry with their taxes but a lot of the entrepreneurship in the smaller computing businesses by imposing IR35.
  Will the Minister use the so-called Henry VIII powers in the Bill to get rid of IR35? I checked with the Clerks, and was told that the proposal can cover any tax matter. If I give way now, will the Minister say that the Government will get rid of IR35? The computing industry would love to get that provision off the statute books. I see from the Minister's staying in a sedentary position that we have drawn a blank.
  Mr. Ian Stewart rose—
  Mr. Redwood: I should be happy to give way to the hon. Gentleman, but I am sure that he cannot make such a pledge.
  Mr. Stewart: I am sorry, Mr. Deputy Speaker. I thought that the right hon. Gentleman had finished his speech. I was rising to speak on my own behalf.
  Mr. Redwood: I do not think that the hon. Gentleman thought that at all, but there we are. I shall proceed.
  There are terrible problems in a raft of rural businesses that are being worried to death by too much regulation. The Government have heaped general regulation, employee regulation and other forms of regulation on them. They are required to have much more sophisticated payroll activities to handle the working families tax credit and other measures that have been introduced—and, of course, the rates keep going up. My right hon. Friend the Member for Richmond, Yorks (Mr. Hague) has said that, at this time of crisis in rural businesses, the Government should at least get rid of the business rate for a few months. Will the Minister use the powers in the Bill, or elsewhere, to do that? That would be a sensible gesture at a time when those businesses are being grossly damaged by over-regulation.
  The Government started their response to the agriculture crisis by saying that people should not go walking in the countryside. That obviously flattened a lot of the hotel and leisure businesses that were making a reasonable living and whose big season was coming up at Easter. We now hear that the Government might relax those instructions. Will Ministers take the opportunity of this debate on regulation to tell those businesses what they are going to do for them? This is an immediate problem:
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  the Easter holiday bookings are being cancelled now. Will the Government deregulate some of those movements, or is it unsafe to do so? If it is unsafe—as it may be—will the Government offer rate relief or some other compensation? This is a serious point.
  I was contacted by constituents today, who pointed out how silly some of this regulation has become. My constituents, who, like me, would like any sensible action to be taken to clear up this dreadful disease in our sheep and our cattle, went to the local park. They were banned from walking in it, but were prepared to accept that regulation. They then discovered that a football competition was going to be held in the park for teams from outside the area, and that permission had been given for the competition to go ahead. Yet my constituents did not have permission to walk on their normal route through the wooded area, which is quite ridiculous, but again shows that Ministers are not living up to expectations—even the expectations in the Bill—of transparent, fair and sensible regulations.
  Mr. Fabricant: May I give another example? There is a long list of legislation that needs to be changed. Is my right hon. Friend aware that pig breeders are breaching welfare regulations? Weaners are being born and are now overcrowding their pens—thus breaking the law—yet breeders are not permitted to move the pigs away or even to slaughter them in situ? Would not this be an ideal point in the debate for the Minister for the Cabinet Office—who I see has now left her place—to make the position clear on that matter?
  Mr. Redwood: My hon. Friend has come up with a powerful and worrying example of conflicting regulation, yet no Minister is prepared to speak for the Government on which part of the regulation is the more important, or to offer any hope at all to people at their wits' end trying to run their businesses against this awful background.
  Mr. Leigh: I go back to a point that I made earlier. Businesses in rural areas are going out of business because regulations are driving our rural tourism industry out of business, yet we are wasting hours of House of Commons time debating a Bill that will never become law because there will be a general election. Is there anything to stop Ministers acting now? Do we need this Bill? What is going on?
  Mr. Redwood: That is our point about Second Reading. On Second Reading, we are allowed to discuss the wisdom of introducing the Bill. My hon. Friends and I feel that Ministers could take action today to clarify the inconsistencies and the awful muddle. We are saying not that they have to be clarified in one way rather than another, but that they must be clarified.
  Ministers must go on television and explain how they are going to handle this awful crisis, and tell us which regulations apply and which do not. If many of the regulations needed to be changed, I am sure that Conservative Members would be willing to take some time today or tomorrow to change them, so that it would be done and rural businesses would know where they stood and had some chance of producing a plan for their own survival.
  The haulage industry is another example of a set of businesses gravely damaged—in some cases, bankrupted or wiped out—by over-regulation, over-expensive

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  licences and over-taxation. A combination of the highest diesel taxes in Europe, very expensive licence fees and a very complicated bureaucracy to regulate so many aspects of those businesses has led business to go to foreign hauliers. It has also led some British hauliers to flag out altogether and run their operations from northern France or Belgium, and it will lead other businesses into bankruptcy.
  The haulage industry will undoubtedly suffer even more because of the spread of foot and mouth disease and the lack of cattle movements. That is a natural event that is extremely sad, but the Government had set the haulage industry up for bad performance long before that disaster hit. It is because the industry was so weak going into the crisis that we shall lose many more haulage businesses as a result of it.
  Mr. Pike: Why did the previous Government not deregulate the road haulage industry between 1994 and 1997, and why did they introduce the fuel duty escalator?
  Mr. Redwood: If we could get back to the levels of taxation and regulation that we enjoyed in 1997, the haulage industry would be cheering in the streets. I am delighted that the Conservative party is now committed to reducing the regulatory and tax burden, but this Government must answer the charge. If the hon. Gentleman is saying that the burden was too high in 1997, why did he support all the measures to increase it between 1997 and today? It is absurd to say that because there were some specks of dust in someone's eye in 1997, sticking a twig into it thereafter does not matter. That is what the Government came along and did.
  It was this Government's fuel escalator that did the real damage. They increased the rate of increase in the fuel escalator, and dragooned their Back Benchers into voting for the measure. It was not a Tory fuel escalator after 1997; it was a Labour fuel escalator. It was bigger and worse after 1997, and it has done much more damage as a result. Will the Minister tell us what action will be used to help the haulage industry under these deregulatory powers, if they are finally implemented? Will it not be too late? Does not the Minister realise that hauliers will be going bust now, tomorrow and for the rest of this week because the Government are over-taxing and over-regulating?
  Mr. Ian Stewart: Will the right hon. Gentleman tell the House whether his party had any plans to remove the fuel duty escalator before it lost power?
  Mr. Redwood: I was very keen to stop it. I think that my right hon. and hon. Friends would have seen the wisdom of my arguments, because when one is on an escalator one reaches a point at which one wants to get off. There is no way in which a Conservative Chancellor would have increased the rate of ascent, given how high it had already gone. A Conservative Chancellor would have listened to the representations and said, "Yes, the duty is now at the same level as that of our continental competitors. It would be dangerous for the industry to raise it further."
  Mr. Fabricant: My right hon. Friend has almost anticipated the point that I am going to make. Does he recall that, at the time of the implementation of the
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  fuel duty escalator, our petrol prices were mid-way in the European range, whereas they are now 10 per cent. higher than the second highest petrol price in Europe?
  Mr. Deputy Speaker: Order. Before the right hon. Gentleman answers that question, I must advise right hon. and hon. Members that they are again straying from the Second Reading of the Bill.
  Mr. Redwood: I am grateful for your guidance, Mr. Deputy Speaker.
  I ask the Minister to take into account road haulage regulation, and explain to the House why this weedy Bill does not tackle that problem. Will he come back to the House with a Bill that deregulates some aspects of the road haulage industry? He must know by now what the industry wants, because the Government have been in consultation with it for many months. Costs are too high, so business is going abroad and hauliers are being driven into bankruptcy by wrong regulation.
  Mr. Bercow: I hope that my right hon. Friend will not allow his natural shyness and self-effacement to cause him to understate his case. May I put it on record that on 26 September 1996, during a speech at Haddenham school in my Buckingham constituency, he advocated deregulation on a massive scale, and that there was cheering afterwards?
  Mr. Redwood: I am delighted to hear that—but you, Mr. Deputy Speaker, will be delighted to learn that I shall not regale the House with the text of my speech. Indeed, as it was made off the cuff, I do not think that I could remember all of it. Anyway, I am delighted that my hon. Friend enjoyed it, and I still believe what I believed then.
  Manufacturing has also suffered badly from too much regulation under this Government. Their feeling has been that any amount of regulation can be poured into manufacturing—regulation affecting jobs, and making the industry do their work for them in regard to tax and benefits—without any trouble being caused. There have already been more than 300,000 net job losses; how many more will it take before the Government wake up to the sad truth that my hon. Friend the Member for South Cambridgeshire revealed, in general terms? We are losing competitiveness. It is no longer cheap enough to make things in Britain—the Government have made it too dear to make things in Britain—so many jobs are draining away to other countries.
  Even this Government must have understood the tragedy that is Corus, and the massive cuts in the steel industry. Even this Government, with Members representing practically all the major textile locations, must have noticed that the textile industry is being gravely damaged by the combination of a weak euro—allowing European competitors more of an edge—with massive increases in costs, many pushed through by too much regulation and taxation. The Opposition look for some relief for textiles, steel and the other basic manufacturing industries, but we look for that in vain in this badly drafted Bill.
  The Bill is an example of cynical manipulation—typical spin. We are told that the Government need greater powers to introduce deregulation. With their majority they could introduce any deregulation they liked as primary

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  legislation, and given that they shove everything through in two or three hours anyway it would not take very long to do the job. Why do they not simply present some deregulation measures in the form of primary legislation? They might even find that we would expedite the passage of such measures, and would not be as worried about being given so little time for debate as we are in the case of many of the massive regulatory measures that they regularly propose.
  We are told that these are Henry VIII powers in a good cause. That does a grave injustice to the late king, who, after all, introduced all his reformation measures in the form of primary legislation, in this House of Commons. Perhaps it is because he was an early Eurosceptic that the Government are taking such exception to him, and giving the powers that name.
  The power that the Bill introduces is wholly undesirable. It is the power to regulate anew, and to impose additional burdens on an already massively overburdened private sector without the normal questions being asked and without the normal processes of primary legislation. It is true that there is long-winded consultation, which the Government will undoubtedly ignore when they have decided what they want to do, and it is true that there is a statutory instrument procedure. I think it wholly undesirable, however, that the House should be bypassed—in several ways—when the Government want to impose new regulatory burdens.
  It is very different from getting rid of things. People have too much government. I have more government than I want, more government than I need, and certainly more government than I can afford. I speak for many of my constituents in saying that. The Bill will create an additional power to allow more regulation, without proper scrutiny.
  I am surprised that the Government think it worth bothering, given that they have developed so many other ways of avoiding proper scrutiny of their measures and regulations. We now have an almost perpetual guillotine, pushed through to ensure that there is as little debate as possible. Labour Back Benchers are asked to occupy all the time available, so that the number of critical remarks can be reduced. Often, Ministers show a contemptuous attitude to those of us who seek to ask legitimate questions about how measures will work and whether they will work.
  Mr. Deputy Speaker: Order. I am not sure what this has to do with regulations. Perhaps the right hon. Gentleman will return to the Second Reading debate.
  Mr. Redwood: I accept your guidance, Mr. Deputy Speaker, but I am trying to discuss the power by order to make provisions reforming the law, which I consider to be a wide-ranging power. My worry—subject to your guidance, Mr. Deputy Speaker—is that it constitutes a method of avoiding even the perfunctory debate that we are allowed under the guillotine and primary legislation procedures; and, because it is so wide ranging, I fear that it is possible to talk about more or less anything. The Government have not made it entirely clear what they will introduce.
  Mr. Deputy Speaker: It is certainly not possible to talk about more or less anything.
  Mr. Redwood: I accept your wise words and your guidance, Mr. Deputy Speaker, but I think you would agree that the Government want to take wide-ranging powers to reform, in unspecified ways, a wide range of law—all law, indeed, that affects persons carrying on an activity or business That is why I have confined my remarks to the subject of regulations affecting businesses. As the Clerks advise me, that clearly encompasses tax regulation, which is often the most onerous and expensive.
  Mr. Pike: Does the right hon. Gentleman accept that the two amendments carried in the Lords, to which I have specifically referred, ensure that a balance of deregulation must offset any new regulation?
  Mr. Redwood: I am not sure that it must offset any new regulation in the way that I would like, but my point is rather different: I believe that any new regulation should have to go through normal procedures, and I see no objection to Ministers' presenting such measures in the form of primary legislation, according to their proposed truncated method of dealing with such legislation.
  I defend the principle of the 1994 Act: that those who wish to strike something off the legislative list might want an expedited procedure. The principle was fairly tightly controlled, but there was some sense in it. I see no case for—effectively—allowing primary legislation to go through to re-regulate increased regulatory burdens under this kind of procedure and I think the House would regret consenting to that.
  The Bill shows that the Government are into a cut-and-run election. They know that the telecoms business, the City, the computing businesses, farms and agri-businesses, haulage businesses and manufacturing businesses are going into a bust. The Government know that many of those firms will shed labour, and that some will go bankrupt: they are suffering very badly.
  In all cases, there is a common thread. Yes, there are world conditions; yes. there are currency movements. The common thread, however—the thing that makes it worse here—is the Government's attitude and their action in over-taxing and over-regulating, usually by means of very expensive licensing, artificially restricting the supply of something that a business needs, and then charging the earth to enable that business to obtain it.
  It is high time that this Government were well and truly rumbled, and my feeling is that the business community is well and truly rumbling them. Far from calling an end to boom and bust, they are creating boom for some and bust for others at the same time. Far from behaving with respect to Parliament they are introducing massive new powers to bypass, sideline and spreadeagle Parliament in the wrong direction. Far from giving us any deregulation, they are going to give us more rules, regulations and costs. Far from understanding the deep trouble in which many of our businesses find themselves, they ride on, taxing

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  and regulating those businesses as if nothing was wrong. I hope that the people will reach the right conclusion on 3 May.
  Mr. Leigh: On a point of order, Mr. Deputy Speaker. I am slightly concerned about the interpretation that you placed on points that may be raised on Second Reading. I genuinely seek your guidance, for future reference.
  Mr. Deputy Speaker: The hon. Gentleman may be seeking my guidance, but it sounds s'ispiciously as if he is questioning the judgment of the Chair. I can say only that I will judge each speech and ea( h point entirely on its merits.
  Mr. Leigh: Of course I am not questioning your judgment, Mr. Deputy Speaker. This is a genuine request for guidance on what we should discuss on Second Reading. I was rather under the impression that, in the case of a wide-ranging Bill with a eery open preamble relating to all "burdens affecting persons", Second Reading-as opposed to Report and Committee-was the one occasion when Members could range widely in discussing the principles behind the Fill. I feel that that is an important freedom, which Parliament must retain.
  Mr. Deputy Speaker: The hon. Gentleman is exactly right that the matter of how widely hon. Members may range in their speeches is entirely foi the occupant of the Chair. I shall bring them back to ordor if I think that they are out of order.
  6.30 pm
  Mr. Brian White: The long speech by the right hon. Member for Wokingham (Mr. Redwood) demonstrates the current state of the Conservative party. Conservative Members have raised many issues concerning regulations that they themselves introduced. Many of the issues that they have raised are not properly related to the debate. My neighbour the hon. Member for Buckingham (Mr. Bercow) gave the game away when he said, "It is all Europe's fault." Those comments sum up today's Tory party.
  Mr. Bercow: I am grateful to the hon. Gentleman for giving way, as it is always a pleasure to joust with one's parliamentary neighbour. There are many things that I am content to blame on the institutions of the European Union, but at no stage in any intervention did I say that it was all Europe's fault. The hon. Gentleman really should correct himself.
  Mr. White: I am glad to hear that the hon. Gentleman thinks that there is something good in Europe.
  I welcome the Bill. The speeches of both the hon. Member for South Cambridgeshire (Mr. Lansley) and the right hon. Member for Wokingham have highlighted the interesting paradox that, although the United Kingdom is one of the least-regulated countries, we are one of the countries that complains most about regulation. The debate has not yet dealt with that paradox. I think that we should judge the Bill on the basis of whether it addresses the issue of what constitutes appropriate regulation. I believe that the Bill does not go far enough. As I shall explain later, I believe that the Bill is not sufficiently radical and only tinkers with current processes.
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  There is a real problem with the regulation-deregulation debate. We seem to be saying that deregulation is good and regulation is bad. It is reminiscent of the 1980s debate in which it was maintained—depending on one's point of view; Conservative Members maintained the opposite—that the public sector was good and the private sector was bad. I believe that that is a sterile debate, as it ignores the complexity of the modern world and confuses issues of principle with specific bureaucratic policies. The confusion of principle with policy serves no one who is engaged in the regulation-deregulation debate.
  Cynics may assume that, in this debate, Conservative Members are playing a game—which is either to do with a post-general election leadership bid or with preventing the Bill from being passed before the next general election. I am not a cynic and I would made no such assumptions. However, I predict that, at the first meeting of the Programming Sub-Committee, there will be a manufactured row designed to demonstrate Conservative Members' outrage about the Bill.
  In their speeches so far. Tory Members have gone on about red tape and the burden on business, but not one has identified what he meant by "burden" or "costs" or has defined "regulation".
  Mr. Redwood: Did the hon. Gentleman not listen to what I said? I gave a whole series of examples of massive costs—costs of licences and costs of taxes—that should not have been imposed. Will he now address those issues?
  Mr. White: The right hon. Gentleman listed various issues and industries, but confused cost issues in those industries with the bureaucracy that deals with those matters. When some of us talk about regulation, we are talking about the costs of bureaucracy. The right hon. Gentleman was addressing issues that have nothing to do with regulation and had to be reminded of that fact on several occasions. The Bill addresses specific regulation issues, not the principle of measures such as the working families tax credit or the working time directive. The right hon. Gentleman was attempting to deal with those matters of principle. I do not think that anyone should have to apologise for saying that working people should have a right to a decent working life and support.
  Mr. Hendrick: Does my hon. Friend agree that the right hon. Member for Wokingham (Mr. Redwood) failed to recognise that spectrum, for example, is a finite resource and should not be given away free, willy-nilly, to telecommunications companies? It is in the interests of the Government and the public that we maximise revenue from the sale of spectrum, and thereby help to pay for schools, hospitals and the Government's other priorities, on which they are doing so well. Does my hon. Friend also agree that it is a matter not of whether we should have more regulation or less regulation, but of how we ensure that we have good regulation rather than bad regulation? That is the issue that the Deregulation Committee has been addressing.
  Mr. White: My hon. Friend is absolutely right on the latter point-the choice is between good regulation and bad regulation, and I shall give some examples of bad regulation later. As for spectrum, as one who worked in the information technology industry before the general election, I do not think that any of those companies would

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  have been prepared to invest such sums if they had not judged that the investment would bring them very high returns. The private companies that the right hon. Member for Wokingham described are not so stupid that they do not judge the market before investing. I do not think that they would be in business for long if they were. The right hon. Gentleman belittled them when he said that they did not make such a judgment.
  The hon. Member for South Cambridgeshire said that the Tory Government intended to reduce burdens. However, as those of us who were not part of that Government know, the reality was very different. There was extensive regulation. Just recently, Virgin railways has offered half fares to people travelling on the west coast main line. I see the hon. Member for Lichfield (Mr. Fabricant) nodding; he is probably one of those who has benefited from that offer, which was an excellent initiative. My constituents in Milton Keynes could not take advantage of the Virgin offer because, according to the licences and regulations issued at privatisation, the fare had to be determined by Silverlink, the local operator, which decided not to allow its customers to benefit from its rival's promotion. The Conservative Government introduced that regulation when they were privatising the industry, effectively to create a cartel.
  Conservative Members' rhetoric is undermined by the previous Government's actions. They go on as if the Tory Government did nothing but deregulate but in fact that Government introduced various regulations from which people have not benefited.
  Mr. Fabricant: The hon. Gentleman has misinterpreted the regulations that applied on privatisation. Just as Virgin was, and is, free to choose the fare that it wishes to charge, so Silverlink is free to decide its fares. The hon. Gentleman has just admitted as much. It is not a matter of regulation. It just so happens that Silverlink, unlike Virgin, has chosen not to make such arrangements. Next year, Silverlink may decide to have an offer, and Virgin may not. That is what competition is all about.
  Mr. White: The hon. Gentleman has missed the point. Silverlink does have offers. However, as consumers, my constituents and I are being prevented by regulations introduced by the Conservative Government from choosing Virgin's lower offer. We can take either the lower fare that Silverlink has rightly decided to offer, or Virgin's higher fare, but regulation prevents us from taking Virgin's lower fare. That is the point that I was making. As I said, the Conservative Government added to the regulatory burden. Although Conservative Members try to create the impression that the Conservative party is a great deregulator, such an impression is belied by the facts.
  The issue of abattoirs has been mentioned. The previous Government's passage and implementation of over-zealous regulation reduced the number of veterinarians in abattoirs.
  Conservatives keep talking about deregulation, but what they actually mean is poorer working conditions, poorer health and safety arrangements, lower pay, and the removal of parts of our disability discrimination legislation. If that is what they mean by deregulation, they will be judged at the general election and found wanting.
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  When the right hon. Member for Henley (Mr. Heseltine) introduced the Deregulation and Contracting Out Act 1994, he said that he would try to reduce the number of business licences from the "absurd" number of 265. My understanding is that by 1997 that number had risen to 355, so I do not think that that was a particularly good example for the right hon. Gentleman to use.
  The parliamentary procedures have already been mentioned, and I would argue that the deregulation and contracting out procedures under the Bill are much better than the present statutory instrument procedures. I serve on the Select Committee on Deregulation, the Joint Committee on Statutory Instruments and the Select Committee on Public Administration, so I see the procedures from three different angles. My experience on the Joint Committee on Statutory Instruments leads me to believe that the procedures outlined in the Bill will be a much more effective way forward, and will also involve more consultation.
  Simply focusing on the number of regulations and the need to deregulate pays no heed to the benefits that regulation can bring to business, and does not consider how regulations work. It does not consider environmental issues, either. I suspect that Conservative Members will complain about environmental regulation. They claim that the Government are not green enough, but we have achieved a lot compared with the Conservative Government. Conservative Members ought to realise that what they say now belies what they did then.
  We could play a game of ping-pong about regulation all night, but that would diminish the seriousness of the Bill. As I have said, we are one of the least-regulated countries, and when we do introduce regulations we do not really debate why we are doing it, or to what categories of people and businesses they apply.
  Another key aspect that we ignore is how regulations are to be enforced. Far too often, they are designed for administrative convenience, rather than from the point of view of the businesses, individuals or consumer groups that will have to use them. That criticism applies to all parties.
  We need to consider the types of burden, and costs are another important element. We also need to think about how people react to regulations and the reorganisation that they require. I can remember having to rewrite computer systems and backdate them, because regulations introduced by the previous Government did not allow time for companies to make the changes.
  One of the important benefits of the Bill will be pre-legislative scrutiny, which will allow such issues to be highlighted to the Deregulation Committee or its successor, and to the House. We never talk about the burden of time that regulations impose, either. That is one of the fundamental ways in which we as a Parliament ought to examine legislation.
  We also ought to think about who the burdens fall on. They do not impact on the business community alone, although of course that community is important. The burden of regulation, also falls on local authorities, education authorities, health authorities and so on. We need a way of ensuring that those burdens can be relieved where appropriate.
  We tend to ignore the question of cross-border and multinational regulation, despite the fact that we live in the age of the internet. The Regulation of Investigatory

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  Powers Act 2000 has already been mentioned, and some of its provisions are already irrelevant, having been superseded because the technology has moved on. Some of us would say that that was a good thing.
  That example shows us that in a complex modern world, the way in which we introduce regulations in the House is not necessarily the best way. We need to take a fundamental look at the type of regulation that we should be implementing. We should approach the matter from a 21st-century standpoint, rather than simply carrying on with our present procedures.
  One of my criticisms of the Bill is that it perpetuates the way in which Parliament enacts legislation. We should consider light-touch regulation; the Government, to their credit, have done that on a number of occasions. We should set an objective. We should ask what the objective of any particular regulation is, and then set out measures by which we can judge whether that objective has been met.
  How people deliver the objective should not be the subject of the regulation; that is one of my fundamental disagreements with the Opposition. I do not think that the Bill goes far enough. We should be able to use the procedures within it to go much further and make legislation more appropriate. We should be able to use codes of practice much more, as that would simplify many of our existing regulations.
  Enforcement practices are important, too. The Bill starts to go down the road towards simplifying them—but that should not be something tacked on at the end; it should be set in stone in the consultation procedures. Too often in our regulations, we add on at the end the enforcement procedures and the details of the way in which the regulations will work.
  There will be 109 statutory instruments before the Joint Committee tomorrow, yet the Committee will probably spend no more than 20 minutes dealing with them. That is no way to deal with regulations—and before the Tories start crowing and saying how disgraceful that is, I have to add that the same thing happened under the Conservative Administration. What is more, by opposing the Bill, the Tories propose to remove a way in which much regulation could be scrutinised more effectively.
  I realise that I shall not persuade the Government to move towards setting objectives and introducing more light-touch regulation today, but they will have to come back to such ideas in due course.
  One of the reasons why people in Holland and other countries can sit round and talk about their regulations is that they are understandable. I was going to say that they are written in plain English, but of course they are written in those countries' own language. In some places that could be, and probably is, plain English.
  How are people to understand what is required of them? An example that came to my attention a few weeks ago is one sentence in one regulation, which reads as follows:
  "In the case of any outstanding request which has been made (in the case of the Gas Act) in accordance with a licence condition imposed under section 7B of that Act either to the Director General or the Secretary of State for a determination of such questions arising under the licence, or under any document specified or described in the licence, as are specified in the licence or are of a description so specified".
  I have read out only five of the 15 lines of that sentence, and nobody can understand what they mean. What the provision actually means is, "If the application's already
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  in the pipeline we'll deal with it under the old regulations; if it's a new one, we deal with it under the new regulations." Nobody can understand 15 lines of gobbledegook.
  Too often we introduce unnecessary complexity in our legislation. People do not understand the issues because they do not understand the language that the provisions are written in. That is what gives rise to the Opposition's comments about the need for more deregulation, when what we actually need is more understandable regulation.
  Mr. Pike: I agree with my hon. Friend's point. Does he agree with me that we often do that just so that the legal profession can make a lot of money determining what the laws we pass mean?
  Mr. White: My prejudice against the legal profession is another matter.
  We do people a disservice when it comes to understanding and, indeed, implementing regulations. I used to be a systems analyst, and had to interpret the previous Government's legislation. I once programmed changes to a computer system, having got the regulation back to front, simply because I did not understand that a "not" was in the wrong place. I had programmed the system according to what I had read and believed was right, when it should have been the exact opposite. That could have cost my company a lot of money; luckily, the mistake was spotted before the system went live. Such complexity does the country a disservice.
  Simply to talk about the deregulation, as the Tories do, is not to address the issue. That is why the better regulation taskforce is such a good initiative, as is the Small Business Service, which looks at regulations. It is not only small businesses that should be looking at them, however: public bodies, trade unions, voluntary groups and the community as a whole should all be asking what regulations are trying to achieve.
  I regret the concession given to the Conservatives in the House of Lords, which made the first objective, deregulation, the primary objective of the Bill, when in fact there are places where we could change the nature of the regulatory burden, helping to simplify the legislation and ensure better understanding of it. That is where I fundamentally disagree with the Opposition.
  Mr. Lansley: The hon. Gentleman makes an interesting argument, but I think that he is missing the point. The comparison with continental systems is essentially to do with the nature of those countries' legal systems. For simple, purposive legislation and regulation of the kind that the hon. Gentleman is looking for, one needs a wholly different legal construction. In the United Kingdom, we are essentially free to do what we like unless the law specifically provides that we shall not, so deregulation is of the essence in achieving a reduced regulatory burden in this country. Under the codes systems in European countries, people are not able to do things unless the code allows them to, so the purposive form of codes often makes it easier to have regulations in that form.
  Mr. White: I accept what the hon. Gentleman says about Europe, but I was not arguing from a European perspective. I was arguing for what I believe is right for this country. The way in which we enact laws acts against

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  the interests of ordinary citizens. We have been described as dotting every i and crossing every t, which causes many problems that we could do without. I am not arguing for deregulation. I am saying that the achievement of regulation should be viewed differently in relation to its objectives. We need to separate those two points in a more transparent way than we have in the past.
  Our parliamentary process should also change. I do not think that we have the best system of parliamentary scrutiny of regulation. The Joint Committee on Statutory Instruments has a very good Clerk and very good legal support, which its members find tremendously helpful. However, I do not think that the Committee's work represents the best scrutiny of regulations. We have not used the Select Committee on Deregulation and the Delegated Powers and Deregulation Committee in the other place in the most effective way. I do not see the point of many of the statutory instrument committees; there is a lot of talk but not many changes. The system for holding Ministers to account regarding regulations should change.
  The Bill deals with preliminary consultation, but a lot more could be done. The Deregulation Committee should do a lot more proactive work, and I think that the proposed changes to its Standing Orders will allow that to happen.
  Removing politically controversial regulations will diminish the role of the Bill. There is so much more that the Bill could do. The successful measures in the 1994 Act would, along with these provisions, enable us to go a lot further and deal with issues such as deferred voting.
  A number of changes were made to the Bill in the Lords. It is typical that the Conservatives agreed those changes in the other place and then oppose them here; I suppose that that sums up the modern Tory party. The original four objectives are now one objective and three aspirations. It is important to recognise the change in clause 1(3). It undermines everything that the Conservative party has said, because it makes deregulation the key part of any proposal. I regret it, but in terms of reaching a consensus, it is probably the best way. It is a major step forward, but there will still be anomalies, inconsistencies and inappropriate legislation.
  My hon. Friend the Member for Burnley (Mr. Pike) made a number of points that I was going to make about subordinate provision and the changes that have been made. I welcome the fact that my hon. Friend the Parliamentary Secretary, Cabinet Office has committed himself to reviewing the Bill. I would like to see it reviewed annually. I hope that in his winding-up speech my hon. Friend will give the commitment that Parliament will review the legislation on a regular basis and that when there is an adverse report from the Committee, the current convention that it should not proceed will continue.
  This timely Bill will take us a step forward. However, we should be looking for much more radical reform. We need appropriate regulations, appropriate processes and an open and understandable regulatory system. People need to be able to understand the laws of this country, what the burden of regulation is and why they have to comply.
  6.58 pm
  Mr. Michael Fabricant: I think that the Bill is designed for a general election: it is not designed ever to become law. This is a Bill in the subjunctive—for example, clause 9(1)(b) refers to "ought". However, the best bit is in the explanatory notes:
  "A number of potential reforms could be brought forward…The following proposals might be capable…Full details of the proposals have yet to be developed …"
  If ever there was an example of spin and no substance, this is it.
  Talking about spin, we have heard that the Chancellor of the Exchequer is the 10p up, 1p down Chancellor. The Minister for the Cabinet Office said that the Bill will ensure that £40 million is returned to businesses. That makes her "£10,000 million up, £40 million back" Mo. We have already heard from the British Chambers of Commerce that some £10 billion of extra burdens have been placed on business. Although I would welcome just £1 back, when one, considers that £40 million in the context of £10 billion, one gets an idea of the size of the problem that we face. I remind the House that the£10 billion of burdens have been imposed on businesses by this Government since 1997.
  I began by mentioning spin, and I want to ensure that the Government do not try to spin my speech to make it sound as if I said that we should abolish the national minimum wage. I make it plain, as I have in the past, that I have never personally opposed a minimum wage. However, as the Minister for the Cabinet Office said, it must be set at a balanced rate. She said in her opening speech that at the last election the Conservative party claimed that the minimum wage would create 1 million unemployed. That was based on the rate of £5 an hour which the Labour party was talking about at the time. As it is, the Government initially set the rate at £3.20 an hour, and it is now about £3.70 an hour, which is very different from the figure on which we based our unemployment predictions.
  Mr. Lansley: My hon. Friend rightly referred to the British Chambers of Commerce. The last publication of its burdens barometer showed that the total cost of additional burdens had reached £9.62 billion. It made it clear that that did not include the recurring cost of the national minimum wage, so the consequent increase in wages as distinct from the administrative cost was left out.
  Mr. Fabricant: My hon. Friend makes a powerful point, which is directly concerned with the nature of the Bill. Members of all parties are concerned about the impact that the minimum wage may have on the national health service. We must recognise that while all working people deserve a decent basic minimum wage. the rate at which it is set will affect the rates of those higher up the scale—those are the famous differentials that we heard so much about in the 1980s and 1990s. A change to the minimum wage affects workers all the way up the scale, and unless there is a consequential increase in the money given to the NHS, there will be insufficient funding for hospitals and all the other services that people need.
  Marjorie Mowlam: I repeat that the figure used by the hon. Gentleman adds the administrative costs of regulation to the cost of the policies themselves. The cost

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  of the minimum wage and the working, families tax credit combined means that the figure is enormous, but the real regulatory burden is much smaller.
  Mr. Fabricant: I do not believe that that is correct. We questioned the British Chambers of Commerce on that very issue, and it disagreed with the Government's assumption. It argued that the total consists of direct costs imposed on its members. When we questioned the organisation further, it said, "Hang on a minute. We're the ones who did the calculation and we based it directly on additional costs." I note that the right hon. Lady is indicating dissent. I accept what she has said, but I hope that she will accept what I am saying when I simply report that the British Chambers of Commerce, which produced the document and did the calculation, says that the Government are wrong. Those burdens have indeed been placed on its members.
  I would add that those members are the very companies that employ a majority of people in the United Kingdom. Many of them are manufacturing companies, so should we be surprised that jobs have been lost? The world economy is expanding and Britain, on the whole, is enjoying a healthy economic climate, not because of actions taken by the Government but because the United States economy is so strong. We have the largest overseas direct investment in the United States, and vice versa. When the United States catches a cold, we sneeze, and vice versa. The economy is doing reasonably well at the moment, except in manufacturing. Unlike the United States, or even Germany, the United Kingdom has lost 300,000 jobs because of administrative burdens. [Interruption.] I think that my hon. Friend the Member for South Cambridgeshire (Mr. Lansley) wants to intervene.
  Mr. Lansley: I am grateful to my hon. Friend for giving way. I thought that I had no prospect of interrupting his flow, because he was being so eloquent. I want to make it perfectly clear that the British Chambers of Commerce burdens barometer includes in its gross estimate of £10 billion both a figure for one-off administrative costs for the introduction of the national minimum wage and recurring administrative costs at an average of the various compliance cost assessment figures that have been produced. The organisation expressly states that the total of £674 million for the cost of the national minimum wage does not include the £2.4 billion estimate for additional wage costs and the maintenance of wage differentials consequent on the policy itself, as distinct from its implementation and administration.
  Mr. Fabricant: My hon. Friend makes a powerful point. I refer him and, more importantly, the Minister for the Cabinet Office, to www.britishchambers.org.uk/ cutredtape/burdensbarometer.htm, where the right hon. Lady can read those facts for herself. Her Department is trying very hard, but largely failing, to achieve the good aim of introducing the internet to Departments. Assuming that she is on the internet, she might care to look at the site and read for herself the point that my hon. Friend has made.
  Mr. Ian Stewart: Will the hon. Gentleman give way?
  Mr. Fabricant: I am only too happy to give way to my old sparring partner. I owe him that, as he voted for me to be joint chairman of the all-party internet group.
  Mr. Stewart: I was frightened lest I referred to the hon. Gentleman as my hon. Friend. He has gone on at length about the British Chambers of Commerce and the so-called burdens imposed by the minimum wage regulations. How does he reconcile that view with the statement made by the Institute of Directors earlier this month? It said:
  "In the past we have expressed some concerns about earlier drafts of the Bill. However, following the amendments made in the Lords. I can assure you that we regard this as a good Bill. If it is used to its full potential it should make a noticeable difference in the Red Tape burden. "
  Mr. Fabricant: I shall not refer to the hon. Gentleman as my hon. Friend, but I thank him for his intervention. The Institute of Directors was concerned about what might be in the Bill, but if he wants to trade reactions to the Bill, I am only too happy to do so. I can tell him that the CBI is not so confident about the Bill. Its president, Digby Jones—a name to conjure with—said that
  "it will not ease concern about the relentless build up of new regulations".
  The British Chambers of Commerce said that it is
  "concerned that the benefits of this measure will be completely overshadowed by government plans to introduce further layers of employment regulation".
  That regulation has created 300,000 job losses when, as I said, other countries, including the United States and Germany, are doing so well.
  Mr. Bercow: I hope that my hon. Friend agrees that it was singularly inept of the hon. Member for Eccles (Mr. Stewart) to intervene to invoke the alleged support of the Institute of Directors, in view of the fact, of which I hope my hon. Friend is aware, that its head of policy, Ruth Lea, is on record as saying:
  "This Government has no idea what it is like to run a business. Business is facing one regulation after another. There is no respite."
  Is that not game, set and match?
  Mr. Fabricant: Game, set and match indeed. My hon. Friend is right; were he playing at Wimbledon, he would be holding the silver chalice high.
  Mr. Ian Stewart rose—
  Mr. Fabricant: I give way to the hon. Gentleman once more, although I want to move on. I do not want to monopolise the debate.
  Mr. Stewart: The right hon. Member for Wokingham (Mr. Redwood) talked about balance. Let me bring Conservative Members up to date with the CBI view. Mr. Digby Jones said:
  "It would be worthwhile reiterating CBI support for the Regulatory Reform Bill at this stage. We believe that the Bill has the potential of providing the tools that could deliver real benefits to business by cutting unnecessary red tape".
  It would have been illogical of Mr. Jones to make such a statement before making the one referred to by the hon. Member for Lichfield (Mr. Fabricant).
  Mr. Fabricant: We could spend all evening trading remarks about the Bill made by various people. The Conservative party does not oppose the principle of

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  deregulation. Indeed, although I cannot possibly tell, I imagine that we shall not vote against Second Reading. However, I make it clear to the hon. Member for Islwyn (Mr. Touhig), the Government Whip, who is reaching for his pager to send a message to the Government Chief Whip, that I am merely speculating. [Interruption.] My hon. Friend the Member for South-West Hertfordshire (Mr. Page) reminds me from the Front Bench that we have a three-line Whip for 10 o'clock. We shall certainly vote for our reasoned amendment: although the principle of the Bill and any reduction in regulation where that is not dangerous to employees and where it does not create an uncontrolled free-for-all are to be welcomed, we are not sure that the measure will improve legislation considered by the House or reduce the burden of legislation.
  In an intervention on my hon. Friend the Member for South Cambridgeshire, I pointed out that the Bill contains considerable weaknesses. One is that it will reduce the scrutiny of legislation by the House. I asked my hon. Friend whether it would have done anything to prevent £628 million of taxpayers' money from being spent on the Prime Minister's folly—the millennium dome. The answer is no. Will it do anything to reduce the £4 billion a year that is lost in benefit fraud? The answer is no. Will it do anything to reduce Government administration costs, which have gone up to £15.3 billion? That is £1.8 billion more than in the last year of Conservative government. Once again, the answer is no. The real fear is that it will further enable the Government to rubber-stamp legislation and whip through the House of Commons measures that would otherwise be scrutinised.
  Mr. White: The hon. Gentleman suggests that the Government will be able to whip legislation through the House. How will they be able to do that, given that consultation will be built into Deregulation Committee procedures? He also suggests that everything can be covered by the Bill. Surely that is not the case, as some matters are outside its remit. I would be interested in his comments on both issues.
  Mr. Fabricant: The whole point is that everything cannot go into the Bill; I wish it could. Those matters that involve burdens as defined by the Bill can be dealt with, though I do not think that it will be enacted, as this cut-and-run Government will clearly announce a general election in the middle of a national crisis. The definition of burden is another loose provision. The Bill is subjunctive—it is all ought and might, not will and shall be.
  Mrs. Teresa Gorman: I appreciate that my hon. Friend has read the legislation in great detail, so I put to him an example from Italy. To relieve burdens, industrial concerns employing fewer than 15 people and agricultural concerns employing fewer than five are automatically exempt from much of the onerous employment legislation that causes them great difficulty there. Does he agree that the Government would emulate the Italians if they were serious about helping small firms?
  Mr. Fabricant: My hon. Friend is right. There are exemptions in the Bill, but only some, and they are for small businesses employing fewer than 20 people. However, in this day and age a firm employing 20 is not necessarily small.
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  I am one of the few Members of the House who did a real job before being elected.
  Mrs. Gorman>: Me, too.
  Mr. Fabricant: My hon. Friend is another, as is my hon. Friend the Member for Hexham (Mr. Atkinson), who is on the Front Bench.
  In 1979, I set up a broadcast electronics and radio station financing company with a partner. The company was small for some time, but in 1991 we were fortunate enough to sell to an American corporation, which gave me the ability to be a Member of Parliament without outside interests. The company had grown and it employed more than 600, but there were fewer than 10 for a long time, let alone fewer than 20. I shall tell you something, Mr. Deputy Speaker had I started my company after the election of the Labour Government in 1997, it would not have employed five people. because it would have gone bust because of the regulatory burden that we now face.
  Sadly, the Bill will not be able to stop the Government accepting and gold-plating European Union regulations. I shall give an example of a measure that destroyed a business in my constituency, and I ask hon. Members on both sides of the House not to break into grins when I mention the company's name. Every time I refer to it in the House, which is not often, Members start laughing—even though this is a serious matter and several hundred jobs were lost. The village of Armitage, which is in my constituency, is famous because Mr. Shanks was based there. [Interruption.] It has started already—my hon. Friend the Member for Buckingham (Mr. Bercow) is smiling.
  Armitage Shanks is one of the largest manufacturers of toiletware in the world, or it was. For many, many years, the Conservative Government resisted a European directive that changed the definition of the mechanics by which toilets are flushed. Until recently, this country used a siphonic system. When the chain is pulled or the lever is pushed, a vacuum is created and the toilet cannot leak. However, every year in France, leaky toilets lead to the waste of 500 million gallons of water, as they use a flat-valve system which corrodes after a while. As we see in France, Germany and elsewhere, water trickles out of toilets constantly, but that system was illegal in the United Kingdom because it wastes water.
  Here is the irony that should have been addressed by the Bill, but which will not be because of its drafting. In 1997, the first year under Labour, the Government went on the attack, telling the private water companies, "Every year, 100 million gallons of water are wasted through leaky pipes." They were right, although similar amounts are wasted in other countries, and it seemed like fair play to attack privatised companies such as Severn Trent Water and Thames Water.
  What did the Government do at the same time? They introduced legislation that put several hundred people at Armitage Shanks out of work. Cheaper toilets from Italy and France will be allowed into this country. When they are introduced, they will leak, which will result in 500 million gallons of water being wasted every year—that is a French Government figure. Where is the logic in that process?

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  One of my criticisms is that the Bill will do nothing about gold-plating and over-regulating legislation. Indeed, it will do nothing whatever to control the Government's obsession with appeasing Brussels and accepting any measure that emerges from there.
  Mrs. Gorman: My hon. Friend will be aware that the flush toilet system that he is talking about was invented by one of our own early pioneers—Mr. Thomas Crapper; his invention set that industry going. Does my hon. Friend think that, in the present climate—of regulatory organisations and legislation on employment, health and safety and the rest—people such as Mr. Crapper, with his excellent invention, would ever have got off the ground?
  Mr. Fabricant: My hon. Friend is right. Although I do not want to be out of order, I want to make one point about her comments before I move on, especially for our many American viewers—we are watched not only on the Parliamentary Channel but on C-Span in the United States. The first managing director of Armitage Shanks was Mr. John, who went over to New York to sell the British system. That is how they came by the slang name "john" for what we call the "loo"—it is not realised that that too came from the small town of Armitage—
  Mr. Deputy Speaker: Order. Fascinating though that may be, I should be grateful if the hon. Gentleman returned to the contents of the Bill.
  Mr. Fabricant: I was about to do just that, Mr. Deputy Speaker. I thank you for your patience while I made those points.
  The problem with the Bill is that it makes no real difference to the increased burdens that have been put on businesses. There is a backdrop of anger in the business sector as a result of all the red tape that has come from the Labour Government.
  In another place, Lord Falconer said that the Bill "facilitates reducing the burden of regulation."—[Official Report, House of Lords, 21 December 2000; Vol. 620, c. 850.]
  However, that remark is as reliable as his comments about the viability of the millennium dome, or indeed as reliable as the Prime Minister's remark that the dome and its success would be the first paragraph of Labour's next general election manifesto. We look forward to reading that manifesto—especially its first paragraph.
  In fact, the Bill can do nothing to reverse the heavy regulatory burden that has already been imposed by the Government. They have no plans to repeal any of the key burdens that they have introduced so far—on pay roll, the social chapter or fairness at work. Neither I nor my Front-Bench colleagues are arguing for repeal of all the burdens costing £9.62 million listed by the BCC£far from it. However, there is a point at which the straw breaks the camel's back; we reached it two or three years ago. The Bill would be more welcome if it actually achieved something—but it will not.
  The Government have wasted billions. I have already mentioned the millennium dome. There are many more examples of pet projects and spin that ought to—but will not—be controlled by the measure. For example, this year alone, the Department of the Environment, Transport and the Regions is spending £1,852,896 on opinion poll research and focus groups. Actually, I have unwittingly
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  told the House an untruth. I said the DETR was spending that money—but it is our money. Taxpayers' money is being spent on opinion poll research and focus groups. The Government are spending our money—
  Mr. Deputy Speaker: Order. The hon. Gentleman is not talking about matters that come under the heading of regulation or of the Bill. I should be grateful if he did just that.
  Mr. Fabricant: Thank you, Mr. Deputy Speaker. I shall not go through the long list of issues that should be covered by the Bill, because you are right. Ironically, if the Bill were all-encompassing, I could list those issues and could congratulate the Government on the fact that they would be covered by the measure. The great flaw of the Bill is that it is one gigantic loophole. This thin Bill is inadequate; it has merely 11 pages and does not encompass the issues that should be covered.
  The hon. Member for Eccles (Mr. Stewart) mentioned the support of the CBI, yet that organisation identified the fact that since the Government were elected in 1997, they have issued 3,000 new regulations that impinge on businesses. The CBI pointed out that every day 10 new regulations affect businesses and that that has destroyed 300,000 manufacturing jobs. It stated that additional costs of £23 billion have been imposed on manufacturing by the Government since they were elected in 1997.
  Mr. Ian Stewart: The hon. Gentleman clearly will not want for matters to raise in future. He recites a range of statistics on the volume of regulation since 1997. I am not sure of the exact statistics, but is he aware that the volume of regulation since 1997 is little different from the volume under the previous Government?
  Mr. Fabricant: The hon. Gentleman is wrong—he is reading his Labour party brief. However, he is right to point out that the volume is similar to that introduced under the previous Conservative Government, but they were in power for 18 years. I am grateful that he makes that point, because we can be clear about the fact that the Government have had at least one achievement: in just four years, they have introduced the same amount of regulation—burdens on business—as Conservative Administrations introduced during 18 years. As I said earlier, not only do the Government constantly invent their own burdens for business, they gold-plate directives from Europe. They accede to Europe—far from being at the heart of Europe, they are the appeaser of Europe. They agree to provisions that benefit French and German businesses at the expense of British businesses.
  Mr. Brady: My hon. Friend alludes to regulations from Europe. Did not the previous Conservative Administration actually make strenuous efforts to slow or stem the flow of regulation from Brussels? Indeed, through the opt-out from the social chapter, we put in place one of the most critical impediments to over-regulation. By removing that opt-out, the Labour Government have opened the floodgates and have ensured that an increasing torrent of regulation will come into the United Kingdom. We shall have no say in whether we either accept or implement it.
  Mr. Fabricant: In his typically calm way, my hon. Friend hits on the heart of the matter. Not only has that

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  surrender to Europe on social legislation meant that we have had to suffer burdens during the past three or four years. but it is a blank cheque for the future. During the next few years, a whole tranche of regulation will be directed at us; we shall have no right of veto over it. Sometimes I wonder why I stand up in this Parliament when it is becoming—at least in this area of activity—a county council to the European Parliament; indeed, not even to the European Parliament, but to the Council of Ministers, who are unelected.
  Mr. Hendrick: As someone who has served in the European Parliament, I point out that it introduces legislation that wipes out thousands of regulations throughout the EU—resulting overall in a net reduction in legislation in the 15 member states. Furthermore, I note that the hon. Member for Tiverton and Honiton (Mrs. Browning) said that with regard to regulation
  "as a Minister under the previous Government…We would be the first to say that we did not do very well".—[Official Report, 19 November 1999; Vol. 339, c. 250.]
  May I ask—
  Mr. Deputy Speaker: Order. I think that the hon. Gentleman might not ask—two bites at the cherry are enough.
  Mr. Fabricant: The hon. Gentleman raises two issues. I am glad, Mr. Deputy Speaker, that you did not allow him to make four or five points. I agree with my hon. Friend the Member for Tiverton and Honiton (Mrs. Browning). Some 3,000 regulations in 18 years represents far too much regulation, but we must control any regulation that hinders employment. Although we want regulations that ensure that people are cared for and protected at work, including the minimum wage, it is no good if those regulations prevent people from being employed in the first place. After all, did not a famous man once say, "You can't make a poor man rich by making a rich man poor"? Can any hon. Member tell me who said that? Abraham Lincoln said it.
  Mr. Hendrick: Does the hon. Gentleman accept that the previous Government introduced 3,367 regulations in 1995, 3,291 in 1996, and 3,199 in 1997?
  Mr. Fabricant: The hon. Gentleman can quote as much as he likes from his Labour party brief. I agree with him that there is too much legislation that burdens business. That is why Conservative Members support the principle of the Bill. However, we oppose the Bill itself because it is a sham. The hon. Gentleman knows that we shall have a general election on 3 May, unless there is a major increase in the rate of foot and mouth infection. The Prime Minister has made it clear that the county council elections will take place then, which is simply code for there being a general election on 3 May. So let us not kid ourselves—the Bill cannot become law unless, God forbid, the rate of infection of foot and mouth disease becomes far worse, in which case even this Prime Minister would have to accept that the general election should be postponed.
  I welcome any legislation that will get the balance right. but the Government have nothing of which to be proud. I make that point again because it must sink into
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  the hon. Member for Preston (Mr. Hendrick), who, all the time that I am speaking, reads his Labour party brief. I remind him that the United States and Europe have enjoyed a very healthy economic climate and that the Government have enjoyed the good fortune of inheriting that legacy and also that of the previous Conservative Government. [Interruption.] The Minister for the Cabinet Office laughs, but I remind her that the rate of growth in the economy has been increasing constantly—boom and boom—since 1993. It has slowed down only since 1997, but, because of the success of the Labour party's spin, she believes her own party's lies.
  It is untrue to say that economic growth and good fortune have happened only since 1997. There has been continued growth since 1993, but it has slowed down since 1997, and it has done so in manufacturing, where, uniquely among the G7 countries, we have lost 300,000 jobs through European legislation and the sheer volume of expensive legislative burdens introduced by this Government.
  Mrs. Gorman: Will my hon. Friend give way?
  Mr. Fabricant: I shall make another point before giving way to my hon. Friend.
  The hon. Member Preston lists the number of regulations introduced by the Conservative Government during the past 18 years, but he does not list the cost of those burdens on business. I should prefer 10,000 regulations that cost my company £1 than one regulation that cost it £20,000. He is singularly silent and looks into the middle distance.
  Mr. Hendrick rose—
  Mr. Fabricant: I have challenged him, so I shall give way.
  Mr. Hendrick: The hon. Gentleman says that he agrees with the minimum wage. but he obviously does not because he calls it a burden on, not a benefit to, the workers. Does the hon. Gentleman accept that crocodile tears are shed over the figures quoted? Does he also accept that the figures from the Institute of Directors differ greatly from those given by the chambers of commerce?
  Mr. Fabricant: My hon. Friend the Member for Buckingham has already eloquently told us what Ruth Lea, director of research and policy at the Institute of Directors, has said, so I need not repeat it. I congratulate the hon. Gentleman on asking two or three questions where another colleague would merely ask one, but he did not answer my challenge and say what was the cost to business of Conservative legislation and burdens on business. All he did was quote the number of regulations. That is a key point.
  Mr. Ian Stewart: Will the hon. Gentleman give way?
  Mr. Fabricant: I promised to give way to my hon. Friend the Member for Billericay (Mrs. Gorman).
  Mrs. Gorman: Is my hon. Friend aware that the local schools in my constituency are unable to undertake the

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  repairs now available to them under Government funds for education because of the dearth of small building firms? When I investigated the problem, I found that the Health and Safety Executive now demands contracts that measure something like an inch thick and specify the safety requirements for each individual at every point in a job. The business man—who is a small builder, not a form filler—has to complete a form for each employee at every point in the job. All that legislation has been introduced under the HSE, and it is making it impossible for people to repair schools and hospitals in my constituency.
  Mr. Fabricant: My hon. Friend makes a powerful point. The Minister for the Cabinet Office said in her introduction that it is important to achieve a balance. That was echoed by my right hon. Friend the Member for Wokingham (Mr. Redwood), but no hon. Member, least of all my hon. Friend the Member for Billericay, would argue for the repeal of health and safety legislation. There needs to be protection for employees Similarly, I do not oppose the minimum wage. I shed no crocodile tears, as the hon. Member for Preston put it, but the balance must be right.
  Many Labour Members, especially those who sit below the Gangway, were very disappointed when the minimum wage was set at £3.20—I believe that it is now £3.70—given that before the election the Labour party promised to set it at least at £5 an hour. The hon. Member for Preston shakes his head, but if he were to look at the documents that his party produced, he would see that they clearly stated that the minimum wage would be between £5 and £5.50 an hour. I am being generous to the Labour party by using the £5 figure. Nevertheless, the Government were right not to set the minimum wage at £5 an hour. If they had done so, our predictions of 1 million unemployed would have come true.
  Is it not appalling that the Minister for the Cabinet Office twists that argument? She said that we were wrong to argue against the minimum wage and suggest that it would create 1 million unemployed people, but it has not done so because the Government showed some sense of reality when they came to office and set the minimum wage at a more reasonable rate. However, my right hon. Friend the Member for Wokingham is right to say that there must be a balance and that we must ensure that legislation is not so burdensome as to mean that no one is employed at all because firms go out of business.
  Mrs. Gorman: Is my hon. Friend aware that the care homes industry, which is very extensive, has said that care homes will have to be closed because the minimum wage has increased, but there has been no increase in the payments that they receive for taking care of elderly people? The elderly people will be shunted around like packages, looking for somewhere that can squeeze enough care from the system. This Government will be responsible for that problem.
  Mr. Fabricant: My hon. Friend makes a valid point, which involves not just the minimum wage. The Minister for the Cabinet Office will know that in every constituency—Labour as well as Conservative—private care homes are closing because a minimum bedroom size has been specified. That has meant that homes that
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  previously accommodated 20 people will have to be altered at high cost and may be able to accommodate only 15 people.
  Mr. Ian Stewart: Will the hon. Gentleman give way?
  Mr. Fabricant:I shall give way in a moment.
  If the minimum specification means that a firm goes out of business or has to increase its rates so much that people cannot afford to keep their elderly parents there, will the Government be proud of that? I hope that the hon. Member for Eccles has a helpful suggestion.
  Mr. Stewart: The hon. Gentleman's information is plain wrong. The regulations to which he refers will not, in the main, come into force until 2002, and some of them will come in even later. He cannot possibly argue that they are causing economic problems for companies.
  Mr. Fabricant: I said that companies are having to close—and they are. I challenge the hon. Gentleman: if this debate is being watched in Eccles on the Parliament Channel, I bet you anything you like, Mr. Deputy Speaker—
  Mr. Deputy Speaker: Order. That is not the correct parliamentary language. It is not appropriate to refer to people outside the Chamber who might be watching the debate.
  Mr. Fabricant: You are right, Mr. Deputy Speaker. but probably no one is watching us.
  Firms are having to make decisions now about what will come into force in 2002. 1 remind the hon. Member for Eccles that we are already in 2001, so we are talking about next year.
  The hon. Gentleman has a long and respected background in the trade union movement, but I was in business and I know that businesses have to plan more than a year ahead. If I owned a care home and I could see a brick wall less than 12 months ahead of me that meant that my firm would go bust unless I did something now, I would have to do something now. Therefore, the regulations are causing problems. I declare an interest: I have a 90-year-old mum, so I am very conscious of this issue.
  I had hoped that I could have said that I support the Bill unequivocally. Unfortunately, I cannot say that because it is such a loose Bill. We have witnessed an admission from the Minister for the Cabinet Office that has identified her as the £10 billion up, £40 million back Mo, but I suppose that is a little bit nicer than the 10p up, 1p down Chancellor.
  European Union regulations, which have so damaged legislation in this country, have already affected many industries, creating 300,000 unemployed.
  Mr. Hendrick: Will the hon. Gentleman give way?
  Mr. Fabricant: I have given way to the hon. Gentleman three times, but he never asks a short question. He always asks two, three or four questions in one, so I will not give way. I am reaching the end of my speech because other hon. Members on both sides wish to speak.

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  Instead of making faces at me, I hope that he will catch your eye, Mr. Deputy Speaker, and make his own useful contribution.
  Mrs. Gorman: Will my hon. Friend give way?
  Mr. Fabricant: No, I will not give way because I am concluding my speech.
  The Bill is condemned by virtue of the fact that it is ineffectual. I repeat one more time that the CBI has said that 3,000 new regulations have been introduced since the Government came into office and the British Chambers of Commerce has identified £9.62 billion worth of legislation that is damaging business. The real proof of the pudding is that, since the Government into power at a time of world economic prosperity, we have lost 300,000 jobs in manufacturing. If the Government are re-elected, the sad thing is that many more than 300,000 jobs will be lost over the next few years.
  7.44 pm
  Mr. Russell Brown (Dumfries): It is an honour to follow the hon. Member for Lichfield (Mr. Fabricant). I am sure that my contribution will not be as exciting as the one that we have just heard.
  It is interesting that the hon. Gentleman made comments similar to those of the right hon. Member for Wokingham (Mr. Redwood). They both talked about a cut-and-run Government, but I was interested by the final comments of the hon. Gentleman. It is not a question of if another Labour Government will be returned, but merely of when. The contribution of the right hon. Member for Wokingham was perhaps nothing more than a pre-emptive strike in a leadership bid.
  I am delighted to have the opportunity to speak because I recognise the Bill's importance for two reasons. First, like some of the other hon. Members who have spoken, I am a member of the Deregulation Committee —albeit for just over a year. The general consensus on the Committee is that this Bill has been needed for a considerable time to simplify the current system. Secondly, I represent a rural constituency that is like many others in that it is dependent on small and medium-sized businesses. That fact has come into sharp focus in the past couple of weeks because of the foot and mouth outbreak. My area has been badly affected and we have seen the impact on the local economy. Therefore, it is right that we should try to remove the burdens on small and medium-sized businesses.
  A lot has been achieved in my area thanks to the work of Scottish Enterprise Dumfries and Galloway, which has done much to sustain small businesses over many years. That success can easily be measured by the survival period of many new businesses.
  Mr. Brady: The hon. Gentleman rightly said that the burden of regulation should be lifted from businesses in his and many other constituencies. Does he believe that
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  the burden on small businesses in his constituency has become greater or less during the four years that the Government have been in office?
  Mr. Brown: I have spoken to many businesses, and I would say that the burden is less. My constituency can tell a success story and that is reflected in the survival period for small businesses.
  Mr. Hendrick: Does not the Conservative party wish to introduce privatisation arrangements for the industrial injuries compensation benefit? That would add considerably to the costs of small businesses and industry in general, because they and not the Government would be asked to stump up the money for the cost of those arrangements.
  Mr. Brown: My hon. Friend is right and makes an important point.
  As my right hon. Friend the Minister for the Cabinet Office noted earlier, when Lord Falconer opened the Second Reading debate in the Lords, he said:
  "The Bill will provide a major tool for this and future governments to reform, entire regulatory regimes and to tackle unnecessary, overlapping, over-complex and over-burdensome legislation." —[Official Report, House of Lords, 21 December 2000; Vol. 620, c. 850.]
  That is one of the Bill's key aspects. It is part of the Government's drive to reform outdated, overlapping and over-burdensome regulations on businesses and the public sector. The Bill will enable whole regulatory regimes to be reformed using a tried and tested parliamentary procedure, and that will result in clearer legislation, better targeted regulation and a climate that encourages thriving business while providing proper protection for people at work, consumers and the environment.
  Mrs. Gorman: On protection at work, I am sure that the hon. Gentleman is aware that all small firms—in fact, anyone who employs anybody—have to have public liability insurance that covers people against injury at work. A small firm could not legally exist without such insurance.
  Mr. Brown: That is right, but we need to consider business and the people whom business employs. Clearly, there is an onus on us all to protect employees. I am sure that the hon. Lady employs staff and that she does her utmost through her insurance to protect them. However, that is not an additional burden that has been put on business by this Government.
  Mr. Ian Stewart: In response to the hon. Member for Billericay (Mrs. Gorman), my hon. Friend may have implied that insurance prevents accidents from happening, but it does not. Good regulation and good working practices—employers and employees working together and following safe practice—are what stop accidents.
  Mr. Brown: My hon. Friend is correct.
  Mr. Pike: Is it not the simple fact that without regulation, many companies would not have insurance and would have to be taken to court in pursuit of a claim? It is those regulations that benefit the worker.
  Mr. Brown: My hon. Friend is right. He has years of experience and I am sure that he has had to tackle cases of employers who flaunt and break the law.

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  The Bill is at the core of the Government's regulatory regime. It will allow them to tackle problems caused by existing regulations. Such measures can cause problems. Fire safety legislation is scattered across 120 Acts of Parliament, which makes it difficult for companies to be sure that they are complying properly with the rules. As someone who comes from an industrial background and who worked for 23 years in the chemical industry—18 of those in the explosives industry—I can say from experience that fire safety regulation is a minefield. It is extremely difficult to understand, even by major employers. Many small and medium-sized businesses find it hard to follow. If we only simplify fire safety regulations, that will be a major step forward for many businesses.
  Mr. Fabricant: The hon. Gentleman makes a powerful and interesting point. Does he agree that there needs to be consistency between fire brigades? I see him shake his head. Does he not think that it is confusing to have a national organisation with several branches throughout the United Kingdom? Surely it would be helpful to have a consistent standard throughout the country, or at least in England and Wales, because fire brigades interpret legislation differently.
  Mr. Brown: That is not what I am saying. I am concerned about 120 Acts of Parliament, not about fire and safety regulations as followed by fire and safety crews in different fire authorities.
  The Bill could be used to simplify and consolidate rules by means of powerful secondary legislation. Pressure on parliamentary time means that such worthwhile reforms might not be tackled. Hon. Members voiced concern about such pressure in the run-up to a general election.
  The Bill will also give Ministers the power to introduce a code of practice for enforcers if they believe that there is a problem of overzealous enforcement. The code of practice would be taken into account at subsequent hearings, although it would not be binding. The Government have had considerable success in getting local authorities to sign up to their enforcement concordat. The additional power will enable them to intervene to give added protection to business if enforcers are failing to adhere to best practice.
  On the more general issue of regulatory policy, the Government have a wide range of measures in place to ensure that regulations meet the five fundamental principles of good regulation as set out by the better regulation taskforce. They are transparency, accountability, proportionality, consistency and the need for targeted regulation. Since 1998, no regulatory proposal with an impact on businesses, charities or voluntary organisations should be considered by the Government without a thorough assessment of the risks, costs and benefits, a clear analysis of who will be affected and an explanation of why non-regulatory action is insufficient. The regulatory impact assessments are usually published for consultation at an early stage so that interested parties can comment, suggest improvements and make corrections.
  The Government have been accused of being more willing to add to the burden of regulation than previous Administrations. We have heard that loud and clear. In fact, the number of statutory instruments is of the same order of magnitude under this Government as it was under
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  the previous Administration, ranging from 3,367 in 1995 to 3,475 in 1999. The vast majority of statutory instruments have no impact on business. The separate process of regulatory impact assessments is used to consider burdens that are imposed by regulation. The number of the assessments that show significant costs on business ranges from 180 in 1995 to 166 in 1999.
  Mr. Fabricant: Although I said that we do not want too many regulations because of the amount of paperwork that they create, it is their cost that is important. The hon. Gentleman referred to the number of regulations that have been introduced. What did they cost business?
  Mr. Brown: I have to admit that I cannot answer that. However, I am making the point, as did as my hon. Friend the Member for Preston (Mr. Hendrick), that the statement that there were 3,000 additional regulations over 18 years was way off the mark. There were 3,000 a year in the past three or four years of the previous Government.
  Mr. Hendrick: Does my hon. Friend agree that the hon. Member for Lichfield (Mr. Fabricant) has not said how much his Government's regulations cost business. It is bizarre of him to expect us to give such a figure when he will not.
  Mr. Brown: I thank my hon. Friend for that comment. He is right. I apologise to the hon. Member for Lichfield for not furnishing him with the figures, but I shall be happy to give way if he has them.
  Mr. Fabricant: I was simply going to respond to the point raised by the hon. Member for Preston (Mr. Hendrick). Conservative legislation cost a lot less than legislation introduced by this Government because we did not lose so many jobs at a time of boom.
  Mr. Brown: No doubt we shall all rush to the Library to check that statement.
  We have to consider the Government's approach to regulation. They continue to strengthen systems for controlling red tape. We have established a new ministerial panel to hold Departments to account for their regulatory performance. We have heard again about the creation of the Small Business Service to ensure that the voice of small business is heard throughout Whitehall. A Minister for regulatory reform has been appointed in each Department to advance the better regulation agenda throughout Government. We have established a central unit in the Cabinet Office—the regulatory impact unit—to ensure that new regulations are necessary and meet the principles of good regulation. We have revised guidance on regulatory impact assessments, which was issued in August 2000. New regulatory proposals must satisfy the criterion of benefits justifying the cost. That is vital.
  The independent better regulatory taskforce has been appointed to advise the Government on improving the quality of regulation, taking into account the needs of small businesses and ordinary people.
  Mrs. Gorman: I acknowledge that the hon. Gentleman genuinely wants to help the small business sector. However, the Conservative Administration established similar organisations, such as the group on small business

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  deregulation, and they simply do not work. We have to take small firms out of regulation and trust them. By covering themselves with insurance, should anything sadly happen to an employee or even to the firm's proprietor, they are at least protected. That is about the best we can do if we are to encourage enterprise and small firms to start up.
  Mr. Brown: I thank the hon. Lady for acknowledging that I want something to be done. All Labour Members want that. However, I am not convinced that the measure at which she hints would set everything right. What we want is regulation that is not burdensome, not to sweep away regulation altogether, as she implies is desirable.
  The hon. Member for Lichfield and I might remain at loggerheads over the cost of regulation. Many wild estimates have been made of the current costs of regulation and its impact on business, ranging from £5 billion by the Institute of Directors to as much as £12 billion by the British Chambers of Commerce. Clearly, both cannot be correct, and I would argue that neither is. The figures confuse the cost of the policy itself—for example, money paid out in the form of the national minimum wage—with the cost of administering the policy, by keeping records, filling in forms and so on. True administration costs—red tape—comprise but a tiny fraction of those sums.
  As one who represents an area that has had extremely low pay, I am not prepared to apologise for introducing the national minimum wage. I served on the Committee that scrutinised the National Minimum Wage Act 1998. I do not know what the general election holds for me, but even if I leave Parliament as a result of it and do nothing else in life, I shall be able to hold my head up and say that I served as a member of a party that introduced the national minimum wage in this country. I am proud of that measure, from which the people of my constituency have benefited greatly.
  We make no apology for improving maternity leave, introducing paternity leave, giving millions of employees for the first time the right to paid holidays, or tackling discrimination against the disabled. Those measures also protect good employers—a point that we must always bear in mind. The overwhelming majority of employers are good employers, and our actions must be about protecting them against unfair competition from the unscrupulous few. When introducing those measures, the Government listened to the views of business and made changes to the working time regulations and the national minimum wage to meet concerns and reduce the administrative burden. I believe that the Government will continue to listen.
  Millions of people have benefited from those measures. About 1.5 million workers are now entitled to higher pay as a direct result of the introduction of the national minimum wage; of those, about two thirds are women. The business community now accepts the national minimum wage, and the recent announcement of an increase to £4.10 will be applauded by those who have already benefited from it. Under the working time regulations, 3.1 million workers have for the first time ever the right to paid annual leave. New maternity rights mean that 85,000 women benefit from the increase in the minimum duration of maternity leave from 14 weeks to 18 weeks.
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  The value of benefits accruing to part-time employees under the part-time workers directive will be £17.6 million. The number of people receiving an increase in non-wage benefits will be 400,000, and 27,000 will receive an increase in pay. The Disability Discrimination Act 1995 provides more than 8.6 million disabled people with the choice and opportunities that others have long taken for granted. Sometimes people feel that such serious issues are overlooked, so that Act has made a huge difference. Stakeholder pensions will give millions of employees access to a good-value, reliable pension scheme.
  It is right and just that we make the comparison with the previous Administration. The number of Acts of Parliament passed in each parliamentary Session is of broadly the same order of magnitude under the current Administration as under the last, as is the number of statutory instruments issued. Less than 5 per cent. of statutory instruments have a significant impact on business. Focusing on the number of regulations pays no regard to the benefits to business, society, individuals and the environment that can accrue from well-designed regulation. In international comparisons, Britain is one of the best places for companies to start, invest, grow and expand. According to the economic outlook published in 1999 by the Organisation for Economic Co-operation and Development, in 1998 the UK had the lowest level of product-market regulation of any OECD country, including the United States.
  The right hon. Member for Kensington and Chelsea (Mr. Portillo) has acknowledged that there is no evidence that regulation is damaging economic performance. The fall is UK unemployment to below 1 million for the first time since 1975 clearly backs up that view.
  Mr. Fabricant: We have to put the lie to that assertion. The Government talk of there being fewer than 1 million unemployed. That is to be applauded, but the truth is that there are fewer than 1 million claimants, whereas the 1975 figure referred to actual unemployed people. There are about 1.5 million people still unemployed. None the less, I congratulate the Government on having at least bucked the trend in manufacturing industry, wherein unemployment has increased.
  Mr. Brown: I thank the hon. Gentleman. I am prepared to listen to what he says, but I remind him that when the Conservative Government claimed that there were 3 million unemployed, the true figure was closer to 4 million.
  On small firms and regulation, the Labour Government's policy is to regulate only when necessary and to ensure that regulation is fair and effective. Should regulation be necessary, the first priority is to make sure that each regulation passes the "think small first" test. We have set up the Small Business Service to work closely with the regulatory impact unit and other regulators to ensure that regulations are enforced in a way that recognises the problems of small businesses.
  As expected, there has been criticism: for example, it has been said that the Bill moves debate on important reforms away from the Floor of the House. In fact, the Bill will not undermine the proper parliamentary process for legislation. It requires thorough public consultation coupled with a tried and tested procedure of thorough

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  parliamentary scrutiny. The accusation has also been levelled that the Government have increased the burden of regulation and that the Bill merely loads more burdens on business. The figures do not bear that out: the number of new regulations issued under the current Government is no different from the number issued under the previous Government. In any case, the vast majority of regulations have no impact on business.
  The Government have important plans to use the powers under the Bill. As already announced, we plan to use them to reform our cumbersome fire safety and weights and measures legislation, as well as to free schools to provide the out-of-hours child care services that are so desperately needed and so well used in many parts of the country. Those are the sort of worthwhile changes for which the Bill has been designed.
  It has also been said that the Bill will allow Ministers to bypass Parliament. I totally disagree with that. The Bill merely extends the existing deregulation order-making power, which was introduced by the Conservative Government under the Deregulation and Contracting Out Act 1994. The safeguards on the existing power, which has been policed effectively by the Deregulation Committee in this House and the Delegated Powers and Deregulation Committee in the Lords, will be supplemented to reflect the breadth of the new power. The Government will not be able to steamroller proposals through using the new order-making power, as the Select Committees have an effective veto and the Parliament Acts will not apply.
  In concluding, I shall comment again on the Conservatives' record. Tories always claim that they will reduce regulation—we heard it said early this evening—but they do not. The hon. Member for Tiverton and Honiton (Mrs. Browning), as a Minister under the previous Government who tried to reduce regulation on business, said:
  "We would be the first to say that we did not do it very well".— [Official Report, 19 November 1999; Vol. 339, c. 250.]
  In fact, as has been said on several occasions, the Tories introduced 3,000 regulations in each of their final three years in office. Back in December 1987, the Institute of Directors said:
  "The excessive burden of regulation on business is halting growth and preventing companies from entering new markets…every year the Government has added to red tape".
  Talking about the previous Government, the right hon. Member for Kensington and Chelsea admitted the truth. He said:
  "We passed volumes of new rules and laws, interfering in almost every aspect of business and social life."
  Back in 1995, the right hon. Member for Henley (Mr. Heseltine) pledged that he would reduce the number of different business licences from more than 250. However, his colleague Roger Freeman admitted in January 1997 that they had increased to 365.
  I shall look at endorsements of the Bill, of which we have heard a number today. In response to its publication in draft form in April 2000, the Prime Minister received numerous letters of support—much to the surprise, I am sure, of Opposition Members. Mr. Digby Jones, who has been well quoted this evening, said:
  "I believe the Bill will allow Ministers to more easily remove regulatory burdens on business."
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  Mr. Jones hoped that the Bill would
  "be enacted as soon as possible."
  Mr. Ian Handford, national chairman of the Federation of Small Businesses, was similarly supportive. He said:
  "I am writing to say how much we are encouraged following a perusal of the published draft Regulatory Reform Bill…We believe that the Bill will be useful in helping to reduce the overall burden on business."
  George Cox, director general of the Institute of Directors, wrote:
  "I would like to make you aware of our support for the Bill and for the aims which it reflects…We very much hope that Parliamentary time will be found for the Bill."
  This Government are finding time for the Bill.
  Like my right hon. and hon. Friends, I welcome the Bill. Like my hon. Friend the Member for Milton Keynes, North-East (Mr. White), I am delighted that our hon. Friend the Minister will review the Bill, and I look forward to its steady progress to the statute book.
  8.12 pm
  Mr. Brian Cotter: I am pleased to speak in this debate. First, I must declare an interest as I have a small business; naturally, I have an interest in introducing things that will reduce the burdens on us.
  As other members of the Select Committee on Deregulation would accept, we must take a great step in reducing regulation in this country. As a Committee member, I am not alone in saying that we do not feel that we have a sufficiently effective remit. The Bill, or a similar measure, is certainly required to tackle the issue.
  Mr. Bercow: I look forward with eager anticipation to the hon. Gentleman developing his argument. At the outset, will he give me his assessment of the Cabinet Minister's speech?
  Mr. Cotter: I have not made any particular assessment and do not wish to be drawn into anything, but if the hon. Gentleman wants me to make an assessment I shall happily assess the speech of the right hon. Member for Wokingham (Mr. Redwood), who carried on at excessive length in a dying speech. Presumably, with the election coming, he was trying to mark the Conservative party's cards regarding the reduction of red tape, even though it is very much responsible for it. As I pointed out, Conservative Members were notable by their absence from the Deregulation Committee, which at least tried to address the issues.
  Unlike other hon. Members who spoke, some of whom waxed on, I do not wish to speak for long.
  Mr. Steen: As a fellow member of the Deregulation Committee, it is only fair to say that one regulation alone has been made this year, and one was made last year. Members who have other things to do cannot be expected to hang around on a Committee that does not do anything.
  Mr. Cotter: I would have expected them to be there when we discussed the Bill, but they were notable by their absence.
  I want to press on, as other Members wish to speak. I wish to concentrate on important points and to try to highlight where we must go. We must argue against

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  having regulation in the first place. I welcome the Government's establishment of the Small Business Service, which, I hope, will go some way towards ensuring that we do not have unnecessary regulation and that businesses can have more input into the legislative process than they have had in the past. I continue to urge Ministers to ensure that the Small Business Service knits in and is effective. It is in its early days, but Conservative Members do not support the initiative. Indeed, their manifesto proposes cuts in the trade and industry budget, which helps to provide the representation that small businesses need.
  A Bill has been introduced, but the hon. Member for Milton Keynes, North-East (Mr. White) talked about consultation with small business being a necessary precursor to ensuring that we do not have regulations that we are now trying to get rid of. I hope that consultation will take place through the Small Business Service and that business Bills will be given longer lead times, so that firms and organisations such as the Federation of Small Businesses, the Forum of Private Business and others can give their views before they are enacted.
  I also support the hon. Member for Milton Keynes, North-East on plain speaking. I know that he has been running with that issue; it is essential that we have clear regulation and plain speaking so that we can all understand what is being got at. That should be part of our general approach in Parliament. We should not pass regulations and Bills that we do not understand, but which we expect people in the outside community to understand. I therefore support the proposals made by the hon. Gentleman.
  Following my intervention, the hon. Member for Burnley (Mr. Pike), who chairs the Deregulation Committee and was here for much of the debate, accepted that the Committee wanted the Government to introduce an annual review of the Bill—or a review at least one year after it was passed. Unfortunately, we did not manage to persuade the Government of that. However, the hon. Gentleman and other Committee members agree that we must have a way of assessing the Bill to see whether it makes improvements. The Committee has decided that it—and, we hope, the new Committee—would wish to undertake that, as parliamentary scrutiny is far more effective.
  Apart from the Bill, any regulation that affects business should be examined by Parliament annually so that we can reassess it and assess the cost of regulation for business and industry, thereby doing the job properly on a rolling basis, year by year.
  The Government, in their wisdom or otherwise, have resisted impact assessments of the Bill. Despite strong arguments from colleagues in the other place, the Government have said that they cannot accept the words "impact assessment" being attached to the Bill. Will the Minister explain what they propose to do instead?
  During my time in Parliament, I have noticed when serving on Committees that an impact assessment of the Bill in question has not always been available at an early stage of our deliberations. Had such impact assessments been available to members of the Committee, many Bills, even over the past four years, would have been improved. I understand that the Cabinet Office is looking into the
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  matter. Relevant and accurate impact assessments of Bills at the consultation stage and beyond would be beneficial in ensuring that we do not have the unnecessary regulation that sometimes burdens us.
  Mrs. Gorman: I thank the hon. Gentleman for his unfailing courtesy in giving way. On impact assessment, does he agree that each new regulation creates a crime, and almost every regulation creates a penalty, which often includes imprisonment for failing to carry out that regulation? Is not that an important reason for us to assess what regulations will do to small firms, to say nothing of the massive bills that will have to be paid to solicitors for taking cases through tribunals and so on? Is not that an unseen part of the need for proper assessment of the cost of the legislation, before we adopt it?
  Mr. Cotter: Indeed. The hon. Lady makes a worthwhile point. As a company director, I am well aware that while I am working in Parliament, I could be held responsible for events that were taking place elsewhere. I was encouraged by a statutory instrument the other day that will result in ACAS—the Advisory, Conciliation and Arbitration Service—being brought in more frequently to deal with issues arising from regulation, which can lead to tribunals being established and further burdens for business.
  Mr. Lansley: I am grateful to the hon. Gentleman for giving way. I want to be clear about what he is proposing. He and I served on the Standing Committee that considered the National Minimum Wage Bill, for which, he will recall, the regulatory impact assessments were exceedingly poor. It would have been far better if they had been more accurate in the initial stages, so that they would have illustrated many of the administrative problems to which the Opposition drew attention in Committee. We were subsequently shown to be right, and the Government had to change tack on many of those issues.
  Is the hon. Gentleman proposing that regulatory impact assessments should be attached to the Bill itself, or that a regulatory impact assessment should be attached to each order made under the Bill?
  Mr. Cotter: Certainly, each order should have a regulatory impact assessment. As I understand it, there is also an issue concerning the impact of the Bill itself. I await the Minister's comments on that.
  The better regulation taskforce was established by the Government. The aspects that it examines are determined ad hoc, but it has nevertheless been a worthwhile venture. Hon. Members in all parts of the House will join me in commending the chairman of the better regulation taskforce, Chris Haskins, for his general approach. I hope that we can adopt such a no-nonsense approach in Parliament. For example, clause 3(1) states that the Minister making the order must be of the opinion that it does not remove any necessary protection. Too often, what is seen as necessary protection is not necessary at all.
  Chris Haskins has promoted the idea of cutting through the cackle and getting to the basics. The hon. Member for Dumfries (Mr. Brown) referred to the approach of not adopting policies that do not suit small businesses. Such an approach is promoted by Chris Haskins.

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  We need an imaginative approach that balances necessary health and safety requirements and what is practical and sensible. For example, there is an organisation dedicated to rolling back red tape for pubs. My hon. Friend the Member for Twickenham (Dr. Cable) spoke about the number of inspectors coming into businesses. Our party believes that the number of inspections should be cut.
  In the case of pubs, there is a dichotomy between inspectors coming in for health and safety or security reasons, and heritage officials coming in if the public house is of historic interest. Recently, the owners of an old pub were asked by their insurance company to install security or safety devices, such as smoke alarms—I do not remember the details—yet the next week, the heritage people said that because the pub was hundreds of years old such work could not be carried out. We must bring common sense into regulation, in Parliament and elsewhere.
  I am happy to say that while I have been in Parliament, and perhaps during the time of hon. Members who have been in this place longer than I have, the ridiculous tea bag tax has not been introduced.
  Mrs. Gorman: The tea bag tax?
  Mr. Cotter: Yes. I shall outline the rough details. If we give tea to our employees, as we all tend to do in life, on a regular basis over a period of years, the tax people can suddenly arrive and ask, "Have you been giving Jack, who works on the lathe, tea for the past 15 or 20 years?" They scribble away and work out what it amounts to. Multiplied by another 20, 30 or 40 employees, that can make quite a bill. Were the tax people to go back 20 years and demand that the resulting bill be paid, that could bankrupt the employer. We want to avoid such nonsense.
  Mrs. Gorman: I thank the hon. Gentleman once more. Does he recall the days when VAT was introduced? VAT inspectors went into Chinese restaurants and counted the grains of rice in a portion, to discover whether the restaurant owners were putting in enough tax returns to cover the amount of VAT that they should have charged on portions of rice?
  Mr. Cotter: That sounds ridiculous. I suppose that counting grains of rice is slightly better than counting grains of sand, as the former are slightly bigger and easier to identify, but both activities seem ridiculous. It is difficult to believe that that happened, but the hon. Lady told us about it and I accept her remarks.
  Mr. Steen: Is the hon. Gentleman aware of the circumstances that affected a small businesses man in my constituency who ran a successful oyster farm? Every so often, he changed the water in which he kept his oysters, but he did not do so too frequently, as it was recirculated. However, the local enforcement officer said, "Look here. We cannot possibly have you circulating the water. You must go to Paignton, pick up sea water, bring it back and keep the oysters in it." That was the requirement, even though the sea water was dirtier than the recirculated water that had previously been used. As a result, the oyster business was closed down. The business man made it clear that he took that decision because he had to use
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  dirtier water. Does the hon. Gentleman agree that such craziness arises because of the introduction and enforcement of too many regulations?
  Mr. Cotter: I certainly agree. The hon. Gentleman gives an example of such craziness. If the oysters could speak for themselves, they would say "We are happy with this water." Unfortunately, they cannot do that, so we must try to argue their case, although we are rather too late in respect of the oysters in question, which have been drowned or destroyed in inappropriate water. If I had an oyster farm in my constituency, I, too, would follow up such concerns. I shall keep a beady eye on the matter and I am grateful to him for raising it.
  I shall now draw my remarks to a close, probably to groans of delight. I have tried to make some key points, the most important of which is that Parliament should try not to introduce regulation and should seek to reduce it when it has done so. I urge the House and the Government to do all that they can to achieve those aims.
  8.30 pm
  Mr. Ian Stewart: It is always a pleasure to follow the hon. Member for Weston-super-Mare (Mr. Cotter), who is a nice man and has a calm manner, although his statements are not always completely sensible.
  As a member of the Select Committee on Deregulation, I appreciate that the current processes for introducing regulation can appear cumbersome, but I agree with the comments of my hon. Friends the Members for Burnley (Mr. Pike) and for Milton Keynes, North-East (Mr. White). I support the Deregulation Committee's report and the broad thrust of the Bill. I appreciate that it will have a particular impact on small businesses, which are an important engine of economic development nationwide, as well as in Eccles.
  My hon. Friend the Member for Dumfries (Mr. Brown) said that the Bill would enable regulatory regimes to be reformed using tried and tested parliamentary procedure. He said that it would result in clearer and better-targeted legislation, and foster a climate that encourages thriving business but provides proper protection for people at work, consumers and the environment. I agree with that view. My hon. Friend the Member for Burnley implied that more pressure should be exerted on Ministers to survey the work of their Departments and actively seek areas that could be deregulated. I believe that a more proactive approach would be welcome.
  However, I am perhaps a bit more radical than some of my colleagues. I argue that the parliamentary system has a weakness that should be addressed with regard to regulation. I believe that there is a stronger argument for a better regulation committee than for the need to deregulate, important though that is. I would like the Government to consider establishing an inspectorate with responsibility not only for encouraging and overseeing regulation, but for identifying the need for deregulation when companies and organisations face unnecessary burdens.
  Mr. White: Does my hon. Friend accept that although there are good reasons for regulations when they are introduced, they often cease to have effect over time and should therefore be reviewed regularly?
  Mr. Stewart: I am a strong advocate of regulation and its continuing review. My hon. Friend is correct.

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  When I intervened on the right hon. Member for Wokingham (Mr. Redwood) earlier, he said that there was a need for balance. I shall therefore present some other information in the interests of balance.
  I want to comment on what is sometimes contemptuously dismissed as red tape. I am proud of the Government because they have introduced the minimum wage and extended employment rights. Hon. Members know my background and would expect me to be interested in such matters. I am worried about some Conservative Members' comments because they display a lack of balance. It is proper to look to employers' interests to ensure that we maximise productivity. However, striking a balance means that we also have to consider employees' interests, especially their health and safety. In this modern age, we must also surely consider family-friendly policies.
  We have given equal rights to part-time workers, most of whom are women, and an entitlement to four weeks' paid holiday a year. There was no such entitlement in this country until this Government introduced it earlier in the Parliament. That is significant, but some would say that it was modest.
  My first Adjournment debate was on occupational health and safety. I argued for the introduction of roving health and safety representatives so that all companies could benefit from the acknowledged expertise of trade union health and safety representatives. Some people argue that there is constant disagreement between employers, workers and their trade unions. That is a fallacy. There is a healthy recognition among most progressive employers of the fact that the trade union movement has developed strong expertise in health and safety in recent years.
  I understand that the Health and Safety Executive is to pilot a scheme such as the one that I suggested. That will spread good practice and improve workplace safety. I get angry when people speak of health and safety as a burden on industry. Safety must always be a priority; safety regulation is an example of good regulation, which is good for business.
  Improved employment rights are not red tape but the embodiment of our commitment to social justice and to ensuring that workers have rights that are appropriate to the workplace in the 21st century. We have some way to go in the United Kingdom before our employees enjoy the same protection as other European workers. A 1999 survey found that we had the longest working hours in Europe. In Belgium, the average working week was 38.4 hours; in Germany, it was 40.1 hours, which was less than the European Union average of 40.4 hours. In the UK, the average working week was 43.6 hours.
  For many years, we have had a worsening problem of long hours. In 1984, 2.8 million people worked a week of more than 48 hours; in 1998, that figure had risen to 4 million—a 40 per cent. increase. The UK is the only European Union country to allow an opt-out from the 48-hour limit. Consequently, in spring 2000, 3 million employees were working more than 48 hours. However, that figure is 25 per cent. lower than that for 1998.
  Mr. Richard Page: Will the hon. Gentleman give the House any productivity comparisons with other European countries?
  Mr. Stewart: I shall mention productivity later in my speech.
  We have heard reports recently about growing levels of stress at work, and the effect that that has on what we now know as the work-home balance. A TUC survey of trade union safety representatives found that 66 per cent. cited stress as the main hazard at work, and said it affects all types of workers. Some workers feel badly managed; some managers are too overworked to manage properly. Regulation of working hours and conditions has a role to play: it can be beneficial and, at the same time, aid production and development.
  In support of my argument I draw attention to the remarks of someone who is neither a known suspect nor a renowned proponent of trade union rights—Mr. Adair Turner, the former general secretary of the CBI. In The Times on 16 March 2001, he said:
  "Britain's economic performance is only adequate: increased investment, not deregulation, is the key to improvement…Arguments that Britain is being held back by the burden of labour market regulation are based on confused economic theory and contradicted by the facts. If labour market regulation is harming our performance, the impact must be measurable in unemployment figures. But there is no evidence that the minimum wage has destroyed more than a trivial number of jobs and the mild re-regulation of Britain's labour market over the past three years has been accompanied by continually falling unemployment."
  As we know, the latest figures show that unemployment has dropped below 1 million for the first time since December 1975. In my region, the north-west, the number of people in employment has grown by 29,000 over the past year. Since the spring of 1997, employment growth has been 106,000. Last month alone, 28,600 new vacancies were notified to jobcentres in the region.
  We must remind ourselves that we are discussing appropriate and relevant regulation. Labour Members are strongly against burdensome and unnecessary regulation, but one person's red tape is another person's protection. We need appropriate and relevant regulation. I support this important Bill and I shall vote against the amendment.
  8.43 pm
  Mr. John Bercow: It is a great pleasure to follow the hon. Member for Eccles (Mr. Stewart). My only anxiety on his behalf is that I have not the foggiest idea what he will do when he finally loses his charisma.
  This is a good opportunity to contribute to the debate on an important Bill, and I should like to advance a number of points. The background to the debate is simple. It is an incontrovertible fact—no Labour Member has been able to deny or gainsay it—that the sea of regulation is now deeper and more hazardous than any with which British companies have previously had to contend.
  The lacuna in the position of Labour Members was starkly revealed when several of them were challenged not on the number of regulations on the statute book but on the cost of those regulations. Reading from their prepared texts, they spewed forth various figures relating to what happened in the latter days of the Conservative Government. I have not sought to deny those figures.
  If Labour Members were aware of previous debates on the subject, they would know that during a debate on regulations on small businesses on 8 March 2000, the hon.

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  Member for Ilford, North (Ms Perham)—a charming contributor to our proceedings and, like me, a parliamentary virgin, if I can put it like that—asked me about the total cost of the regulations that had taken effect in the last three years of the previous Government. I said that, off the top of my head, I did not have the square root of an idea but I would be happy to engage in correspondence with her, if she would find that an enjoyable experience. I am not interested in looking back, and I recognise that the record was not perfect. Nevertheless, the burden of regulation is now greater, more expensive and more difficult to bear for companies the length and breadth of the land.
  On that point, I am happy to take my cue not from Conservative Members but from the authentic representatives of industry and commerce themselves. We learn something significant when we read what they have to say, and listen to their public pronouncements. We all know that the Confederation of British Industry, the Institute of Directors, the Federation of Small Businesses, the Forum of Private Business, the British Chambers of Commerce and, indeed, the Institute of Chartered Accountants in England and Wales will typically disagree on a number of matters pertaining to British business. They will have differing views on the merits or demerits of British entry into the European single currency; they will have differing views on the merits or demerits of legislation to counteract the phenomenon of late payment of commercial debt. Of one thing we can be certain, however: they all agree that the burden of regulation is high, that it continues to rise, and that the ratchet needs to be arrested and, wherever possible, reversed.
  Mr. White: Will the hon. Gentleman give way?
  Mr. Bercow: Not now. Because the hon. Gentleman is my near neighbour, if he behaves himself I will consider giving way to him later when I have developed my argument; but it is important that we do not spare Government Back Benchers the pain of revelation, in public debate, of the enormity of the burdens they have inflicted, through their voice and votes, on companies in this country.
  Those burdens fall principally into four categories. First, there are Brussels directives. I am thinking of, for example, the working time directive, the part-time workers directive—which was transposed into British law via the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000—and the parental leave directive, which was specifically the consequence of the Government's boneheaded decision to sign up voluntarily to the European social chapter, rightly eschewed by the last Conservative Government.
  The second category comprises payroll burdens, about which we have heard very little from Labour Members despite their importance. I refer to, for instance, the working families tax credit, 52 per cent. of whose administrative cost falls on small companies. Let none in this Chamber forget that 99.6 per cent. of British businesses employ fewer than 100 people, that they account for approximately 57 per cent. of the private sector work force, or that they generate two fifths of national output. The fact that those companies are burdened by the working families tax credit is therefore important. Moreover, they are encumbered by—for example—the Education (Student Loans) (Repayment) Regulations 1999, and by the regulations that apply to stakeholder pensions.
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  These are significant matters. The point that I seek to make—in my characteristically shy, reticent and understated fashion with which Members on both sides of the House are familiar—is that whatever the merits or demerits of the measures we are discussing in and of themselves, they have one thing in common: they shuffle off responsibility from central Government to beleaguered businesses, forcing the latter to become unpaid tax collectors and benefit distributors. That is wrong, that is pernicious, that is damaging, and it is a phenomenon that can continue unchecked only because—with the insouciance that this Government typically display—no DTI Minister serving in the House of Commons has ever run or worked in a business.
  Mr. Pike: Will the hon. Gentleman give way?
  Mr. Bercow: Yes, very briefly.
  Mr. Pike: Who transferred the burden of statutory sick pay to employers, and away from the old sick pay scheme?
  Mr. Bercow: I am intrigued by that question. The hon. Gentleman is falling into precisely the trap against which I should have thought one of my earlier paragraphs would warn him.
  The point is—the hon. Gentleman may find it difficult to grasp, but I invite him seriously to treat with it—that I was not in the House of Commons before the last election. I was not a member of the last Conservative Government; I was frequently critical of that Administration. I am simply not interested in playing ping-pong about what happened in the past. The point that I am making to him is that it is possible to do much better. He may believe that the regulatory burden was too great before Labour Members took office, but that is no justification whatsoever for adding to the totality of the burdens with which businesses are encumbered.
  I am therefore sorry to say that, although the hon. Member for Burnley (Mr. Pike) may think he has a decent point, it is simply not on my radar screen so far as today's proceedings are concerned. I shall not be in any way deterred or diverted by periodic interventions by Labour Members from continuing to ram home the point about the scale of burdens and the number of different categories into which, under this Government, those burdens fall.
  The third example of burdens under this Government is what might be called the alleged domestic "fairness at work" arrangements. Here of course we are talking about statutory trade union recognition—which militates against labour market efficiency, is largely resented by British companies, does not seem to be necessary and cannot contribute to productive potential.
  Mr. Ian Stewart: Will the hon. Gentleman give way?
  Mr. Bercow: Not at the moment. The hon. Gentleman has just had his speech, and I am going to make mine. However, if he behaves himself, I shall happily consider giving way to him later.
  I happen to think that that is an undesirable regulation.
  Mr. Stewart: Will the hon. Gentleman give way on that point?
  Mr. Bercow: Generosity always gets the better of me, despite my best endeavours to the contrary. I shall give way.
  Mr. Stewart: I thank the hon. Gentleman. It is a bit rich to be arguing about the need for deregulation and fewer regulations. Under the previous, Conservative Government, one of the biggest burdens placed on employers was precisely the type of regulation that he is talking about. It was the outrageous burden of having regularly and persistently to conduct ballots on check-off, which is the deduction of union subscriptions at source. The outrageous nature of the hon. Gentleman's comments shows that the charisma stuff that he is taking is a bit too powerful for him.
  Mr. Bercow: I am very grateful to the hon. Gentleman for his intervention, but it was tedious, long-winded and unfocused in equal measure. I have not received a single representation from a business in my constituency—large numbers of which I regularly visit—saying that they strongly approve of the Government's position on statutory trade union recognition and how terribly irksome it was previously to have to conduct regular ballots. I am not entirely clear which planet, or stratosphere, the hon. Gentleman inhabits, but it is not in any way the same as that on which my worthy and industrious constituents of Buckingham live.
  I warn the hon. Gentleman, because I am well disposed to him, that the quality threshold will have to be satisfied if he thinks that he will have another intervention. His performance so far is not very auspicious. Of course, however, he will not divert me from the fourth category of regulation by which companies in Britain are encumbered to a greater extent now than ever before—environmental taxes and regulations.
  Company after company has justifiably complained about the burden that is threatened by the climate change levy and by the extremely detailed, complex and rigorous integrated pollution prevention controls. Many sectors will be badly hit. Those regulations are extremely zealously drafted. The expectation is that they will, as usual in the United Kingdom, be gold-plated. Those who will lose out are companies. Ministers themselves will not have to pay, as they themselves do not run businesses. They themselves are not familiar with enterprise. They themselves will not suffer. However, those businesses will suffer. It is on their behalf and in their interests that I am proud, with my right. hon. and hon. Friends, to speak in this debate.
  The effect of all that regulation can be measured in various ways. However, I thought that the Institute of Chartered Accountants in England and Wales made a very interesting assessment. In its study, it concluded that, under this Government, companies with between 51 and 200 employees face annually an extra regulatory burden of about £10,500. For companies with between 11 and 50 employees, the amount is £4,700, and for the smallest micro-businesses it is £1,700.
  The significant fact, which is another serious challenge to Labour Members, is that the most recent survey that that organisation undertook revealed that the burden for
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  the average company was about £3,600 a year—a burden that had more than doubled since the previous year. Not only is the burden, high, but it continues to rise. The Government do not even acknowledge that fact, let alone propose to do anything about it.
  We know, not only from those small business organisations but from others, how corrosive the impact of that regulation is Accountancy firms, business analysts and policy institutes consistently speak with one voice: they say that the Government are getting it wrong, and that it is time they had the decency to acknowledge the fact and propose remedial action without delay.
  The Deregulation and Contracting Out Act 1994 was passed by the previous Government. I will not dilate on that subject at length, because many hon. Members have, rightly, already touched upon it. Suffice it to say that it was generally agreed, not least during the debate in another place, that the Act had achieved something worth while.
  Mr. White indicated assent.
  Mr. Bercow: The hon. Member for Milton Keynes, North-East (Mr. White) signals his assent to that proposition.
  I believe that about 46 deregulation orders have been passed, of which 37 took effect under the previous Government. I salute and compliment Lord Falconer of Thoroton, who, in the Second Reading debate on the Bill in the other place on 21 December, was good enough to admit that the peak dear for deregulation orders was 1996. He did not—for he could not—dispute the observation of the better regulation taskforce, set up by the Government for the purposes of giving advice to the Government, that in recent years the number of such orders had dwindled.
  Yet when the hon. Member for Burnley, the Chairman of the Deregulation Committee, was challenged about some of the Government's recent proposals and suggestions for future action, and was asked whether he knew of any obstacle to prevent the passage of those measures under existing legislation, the hon. Gentleman, who is an assiduous and committed parliamentarian, almost took my breath away—[Interruption.] I say "almost" advisedly, Madam Deputy Speaker, because that would be a remarkable accomplishment, as I think the House would acknowledge.
  Mr. Ian Stewart: Why did he not finish the job?
  Mr. Bercow: The hon. Gentleman did not succeed in taking my breath away, but I was very surprised when he owned up to the fact that he had made no study of the subject at all. That was unfortunate.
  Worthwhile policy objectives have been accomplished by the 1994 Act—for example, electronic receipt of cheques, and the increase in the number of fundraising events at which charities can sell alcohol. Finally, there is the worthwhile development whereby couples about to get married can book the registry office 12 months in advance of the happy day, whereas before they could only book three months in advance.
  The Act was a good piece of legislation, and the Government have pitifully failed to take advantage of it. They are wringing their hands, displaying their impotence and trying to blame it all on the previous Administration,

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  who had done something constructive. Now, at the last minute, and in full recognition of the fact that the Bill will not become law, the Government propose a new measure instead.
  As my noble Friend Baroness Buscombe said on Second Reading in the other place on 21 December, the merit of the 1994 Act was, among other things, that it was a one-way street designed to facilitate deregulation. There was no mixed message; the Act had a clear objective, and demonstrated intent. What is more, it had a track record of achieving something worth while for businesses and customers.
  What we see before us now is a forked-tongued Bill. Its proponents give the impression of not knowing exactly what they want. They want to provide a facility for deregulation, although the track record does not suggest that they are likely to do very much in that regard, but they also want the power to re-regulate, as my hon. Friend the Member for South Cambridgeshire (Mr. Lansley) observed earlier, in a potent contribution.
  The power to re-regulate is worrying, but so, too, is the provision for subordinate provisions orders in clause 4, for it was originally intended that such orders would be subject to the negative assent procedure. There was widespread objection, not least in the other place. As a result of an amendment tabled by the former Director General of the Office of Fair Trading, Lord Borrie, the position was changed. As I understand it, such measures can be introduced either by the negative or by the affirmative procedure. That still does not offer much encouragement or succour to those who, in the four years of this Parliament, have regularly watched the Government ram through obnoxious, burdensome and damaging measures on the nod without the facility of a parliamentary debate. That is something to which the Parliamentary Secretary, Cabinet Office should turn his mind.
  In a parliamentary answer on 27 November to the hon. Member for Harrow, West (Mr. Thomas), the Minister listed no fewer than 51 items for future deregulation. The Minister for the Cabinet Office mentioned no fewer than five in this debate, spanning three or four Departments. The interesting point about those 51 items is that only five of them relate to the Department of Trade and Industry. Nine are the business of the Home Office, eight are the business of the Department of the Environment, Transport and the Regions, five are the business of the Department of Health, five are the business of the Ministry of Agriculture, Fisheries and Food, four are the business of the Lord Chancellor's Department and four are the business of the Driver and Vehicle Licensing Agency. We are talking about a large area of regulation that does not relate to the Department of Trade and Industry.
  Mr. White: I am sure that the hon. Gentleman is aware that most of the regulations proposed for deregulation in the Select Committee on Deregulation came from Departments other than the Department of Trade and Industry, particularly the Home Office. The hon. Gentleman is developing a point about deregulation. Will he address the issue of how to deal with inappropriate, out-of-date and anomalous regulations?
  Mr. Bercow: If my proposal were adopted, there would be a system of sunset regulation. A regulation would automatically lapse or expire on a given date and
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  it would be for Parliament to decide to renew it. That is a specific and concrete response to the hon. Gentleman's point.
  I am concerned about the scope for deregulation and the number of Departments that it involves. I make this point to illustrate the need for a joined-up, properly targeted, suitably co-ordinated Government programme. That is what leads me to the position of the Secretary of State for Trade and Industry. The right hon. Gentleman simply does not seem to grasp the significance of the problem that he faces. In an apparently important speech to the British Chambers of Commerce in Glasgow on 3 June 1999, the Secretary of State for Trade and Industry said that the Government had to rethink—the word is his, not mine—their approach to deregulation if they were to "make a difference". That was why he had asked his Department to conduct "a systematic review" of the regulations for which, he said, he had responsibility.
  It is precisely the narrow, inward-looking, complacent and, if I may say so, navel-gazing approach exhibited by the Secretary of State for Trade and Industry which shows us why the Government have made such a mess of this area of public policy.
  As my hon. Friend the Member for South Cambridgeshire indicated earlier, the Opposition are simply not content with such a piecemeal, half-hearted and superficial approach to deregulation. On the contrary, my right hon. and hon. Friends propose the establishment of a deregulation commission for which the regulatory impact unit of the Cabinet Office would work. We insist that there should be a total audit of the cost of all Government regulation. When I had the privilege to introduce the Regulations on Small Businesses (Reduction) Bill under the ten-minute rule on 27 April 1999, I was astonished when, in advance of my presentation, I received a written answer from the then Parliamentary Secretary, Cabinet Office, the hon. Member for Liverpool, Walton (Mr. Kilfoyle), which indicated that the Government did not publish, and moreover that they had no intention of publishing, a statement of the annual costs of regulation.
  My hon. Friend the Member for South Cambridgeshire made the point clearly—as the shadow Secretary of State for Trade and Industry, my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory), has regularly done—that we intend in government to conduct a total audit of the cost of regulation. Once that cost has been established, each Department under the next Conservative Administration will then be given a target for reducing the cost of regulation and will be obliged annually to report on the measures that it has taken and the progress that it has achieved in pursuit of that objective.
  Where regulations are essential, and I accept that sometimes they are, we propose longer lead times for consultation. A minimum of three months should be regarded as the norm. There is no reference to that in the Bill. There should be a minimum period of three months for the requirement to implement regulations. That is not referred to in the Bill, and when the Parliamentary Secretary winds up the debate, I should like to know why.
  We believe that there should be exemptions for small firms from some of the most damaging regulations. We often hear it said, in Labour Members' criticism of such a proposal, that that might allow small companies to gain an unfair advantage over large companies by

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  circumventing, for example, health and safety legislation. Obviously, no such opportunity should exist, but is it not illustrative of the anti-enterprise mindset of Labour Members and their unhealthy post-election but continuing dalliance with representatives of big business that they always see things from the point of view of big companies, corporations and institutes?
  What about the rather more commonplace fact that large companies have an advantage over small because they are able, more readily and without pain, to absorb the costs of regulations? They have in-house lawyers, personnel departments and accountants. None of these matters is as problematic for them as it is for a struggling small firm that is trying to recruit staff, to expand its market, to sell products, to satisfy its customers and thereby, perhaps, to become a little larger. The point about exemptions is important, as indeed is the point about sunset regulations.
  In future, we want regulations to work on the basis so successfully practised in large parts of the United States. A regulation would automatically lapse or expire on a given date. If Parliament, in its wisdom and on the strength of a practical assessment, judged that the regulation had been worth while, there would be nothing to stop it renewing it. If it did not think that the regulation had been efficacious, it would decline to do so. Those are sensible, practical and thought-through measures from a party that is not only committed to, but immersed in, British enterprise. They are wholly alien to Labour Members, who are just not familiar with the thinking of companies, and particularly that of small companies.
  Before I conclude, I want to say something about the European context. [Interruption.] The hon. Member for Plymouth, Devonport (Mr. Jamieson)—he who should be silent—chunters from a sedentary position in evident disapproval of what I am saying. He was not present for much of the debate. He did not hear the very long speeches—which, on the whole, were not very illuminating—that Labour Members delivered. We have the opportunity to comment on the Bill. His party has a large majority. I do not begrudge it that majority, but scrutiny is important and I will have my say. He will not stop me having my say, and the sooner he realises that, so much the better.
  I always listen to the Minister for the Cabinet Office with interest. I do not wish to embarrass her unduly, but I have long had considerable respect for her. However, in preparing for the debate, I was a little taken aback by one or two points on Europe that I encountered. I am sure that she recalls that on 21 July 1999 the Cabinet Office published what was called a guide to better European regulation, for the benefit of people devising, negotiating, implementing or, for that matter, communicating the content of new European regulation. It was a toolkit for how they might more effectively go about that. That was followed, on 18 October, by her visit to Brussels.
  I do not know whether the right hon. Lady remembers what she said on that occasion, but I do. In talking to her colleagues, she said that she was pleased that the new Commission attached such importance to the pursuit of a better regulatory framework. She added that better regulation was a key area for the success of the European Union. These people never talk about deregulation,
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  my hon. and right hon. Friends will readily understand, and I am bound to tell her that I was astonished to hear that that was what she said.
  The right hon. Lady is an experienced parliamentarian and public servant. but is she unaware of the extent to which this country is already ground down by excessive European regulation? Of course we often make the mistake of gold-plating such regulation ourselves—we add to it and make it more burdensome; it becomes increasingly expensive—but the origin of much of that which belabours us is the European Union.
  Marjorie Mowlam: I am sure that the hon. Gentleman knows that this country has one of the lowest levels of regulation in Europe. During my visit to Brussels. I worked to achieve a clear level playing field on regulation—that is what is important in Europe—and I have done so since. Our businesses suffer because others treat regulation differently.
  Mr. Bercow: I am not unsympathetic to the principle of a level playing field, although my main concern is that our regulatory burden should be as low as is consistent with safety, decency and propriety.
  The right hon. Lady makes the point, as did a number of Labour Members, that the regulatory burden in this country is lower than that in most EU member states. A degree of speculation is involved because the empirical evidence is by no means clear, but in so far as that is true, it is not least because, for many years, deregulatory Thatcherite policies were applied in this country when burdensome regulatory and socialistic policies were being implemented in those member states. I am prepared to concede, though I do not know for certain, that the burden might be lower here than in those countries.
  Mr. Hendrick: Will the hon. Gentleman give way?
  Mr. Bercow: No, because I intend to respond to the right hon. Lady. The hon. Gentleman will have to hear me out.
  Many European Union member states might face more statutory regulation than we do. They tend more readily to sign up to 'high-falutin' declarations and statutory commitments, but the right hon. Lady must concede, because she effectively did so in her intervention, that there is frequently a chasm between what the European Union says in statute and what it does in practice. She really must note that central point. We sign up to a proposition and zealously enforce it; our European partners frequently sign up to what would be burdensome impositions—
  Mr. Hendrick: Will the hon. Gentleman give way?
  Mr. Bercow: No [Interruption.] No, I shall not give way.
  Our European partners frequently sign up to burdensome propositions without having the slightest intention to give themn effect in practice.
  I want to conclude—
  Mr. Hendrick: Will the hon. Gentleman give way?
  Mr. Bercow: 1 have said before and I say again to the hon. Gentleman—who has had many opportunities to

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  intervene and we have all enjoyed listening to his dilations—that I am not giving way. I do not need to repeat the point. The hon. Gentleman can resume his seat and absorb the remainder of what I have to say, on which I should be grateful if the Minister for the Cabinet Office would reflect.
  In two treaties, there is an over-arching power from which this country stands to suffer. I refer first to article 3b of the treaty of Maastricht, so I am making a non-partisan point—[Interruption.] I emphasise to the hon. Member for Milton Keynes, North-East that I am making a non-party-partisan point. Article 3b of the treaty was about subsidiarity. It was designed to reassure those of us who were concerned that the overweening power of the European Union was stifling and circumscribing this country's capacity for national self-government. Article 3b states—
  Mr. Hendrick: Will the hon. Gentleman give way?
  Mr. Bercow: No, I have already told the hon. Gentleman that I shall not give way. I intend to make my point. In the circumstances, it is not unreasonable to expect him to let me do so.
  Article 3b states:
  "In areas which do not fall within its exclusive competence, the Community shall take action, in accordance with the principle of subsidiarity, only if and in so far as the objectives of the proposed action cannot be sufficiently achieved by the Member States and can therefore, by reason of the scale or effects of the proposed action, be better achieved by the Community."
  Supporters of the incorporation of article 3b would have us believe that it is a great protection of the rights of nation states. I argue that in fact it is the very language of a centralised federal state from which crumbs from the top table can periodically be cast down. In effect, that power enables the institutions of the EU to initiate legislation on a panoply of fronts and we are almost powerless to resist.
  Mr. Hendrick: Will the hon. Gentleman give way?
  Mr. Bercow: No, I have already made it clear that I am not giving way to the hon. Gentleman. I intend to develop my point.
  In the circumstances that I outlined, it is not credible for the Minister for the Cabinet Office to pretend that we are protected from the burden of regulation and from the increasingly omnipotent power of the European Union.
  Finally, the position was worsened at the time of the treaty of Amsterdam, the protocol to which—on subsidiarity and proportionality—stated:
  "The application of the principles of subsidiarity and proportionality shall respect the general provisions and the objectives of the Treaty, particularly as regards the maintaining in full of the acquis communautaire and the Institutional balance; it shall not affect the principles developed by the Court of Justice regarding the relationship between national and Community law, and it should take into account Article F(4) of the Treaty on European Union, according to which the Union shall provide itself with the means necessary to attain its objectives and carry through its policies."
  To a distinguished intellectual such as the Minister, that ought to be clear. It means that the power relationship has not changed: the Court is supreme; the existing acquis is sacrosanct and there is no prospect of a rolling back of
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  the frontiers of European supranational socialism. In those circumstances, it is not reasonable for the right hon. Lady to pretend that the whole tidal wave of European supranationalism can be stopped or reversed. That is how serious the situation is—
  Madam Deputy Speaker (Mrs. Sylvia Heal): Order. The matter under debate is regulation and deregulation.
  Mr. Bercow: Absolutely, Madam Deputy Speaker. I am grateful to you for that reminder.
  Notwithstanding the arcane and circumlocutory language of article 3b of the treaty of Maastricht and of the protocol on the application of the principles of subsidiarity and proportionality in the treaty of Amsterdam, they are potentially and directly relevant to whether we can deregulate, and if so, how and to what extent. The answer is, "Not enough."
  The burden of regulation is greater. The Deregulation and Contracting Out Act 1994 was a good measure from which real benefits flowed. The Government have contrived a feeble excuse—at the last knockings of this Parliament—to introduce an alternative measure, having wholly failed to make proper use of that which was already on the statute book.
  My right hon. and hon. Friends propose an altogether better course—an ambitious, robust and deregulatory course that will commend itself to business. We intend to persist with that course, and I commend that proposition to the House.
  9.20 pm
  Mr. Anthony Steen: After that tour de force from my hon. Friend the Member for Buckingham (Mr. Bercow), what more is there to say? He said it all in a marvellous speech. I very nearly could not stand up because I was so spellbound by the content and force of his delivery and contribution. In the 10 minutes available to me in this debate, I want to say that it is not fair to those in the Public Gallery to hear such esoteric debates. I feel that one of my jobs as a modest and senior Back Bencher is to help those in the Public Gallery, and those hon. Members who have not the intelligence to follow my hon. Friend the Member for Buckingham, to understand what the debate is all about.
  Madam Deputy Speaker: Order. I appreciate that the hon. Gentleman is an experienced Member, but perhaps he has forgotten that we do not refer to the Gallery.
  Mr. Steen: I had forgotten that, Madam Deputy Speaker. I am glad to be reminded of that archaic approach.
  I want to make one or two comments for the benefit of those hon. Members who have not had the advantage of listening to all the debate. I have been involved in deregulation for many years. I served on the Standing Committee that considered the Deregulation and Contracting Out Act 1994, and spoke in the debate on Second Reading. I used to be chairman of the Conservative party's deregulation committee.
  I want to make this simple. As I understand it, the Bill has two aspects, the first of which really tells us that the Select Committee on Deregulation, of which I am a member, has run out of material to deal with. We have

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  dealt with one matter this year, and we dealt with one last year. Unless we broaden the scope of the Deregulation Committee, we shall have to close it down. As the hon. Member for Burnley (Mr. Pike) wants a job—he has done it very well—the Government have decided that they should widen the scope of the deregulatory initiative, but that is a curious concept.
  Instead of deregulating, the Deregulation Committee will be given an increased portfolio of existing rules and regulations that it can amplify. That interesting concept will involve not getting rid of regulations, but gold-plating existing ones and adding to them. That is what the new Select Committee on Deregulation will deal with, but because of the danger of doing so without some controls, the Government have included the so-called five tests—it is like the 10 plagues in the Old Testament. The five tests are extraordinary, and I do not know how they will work. First, there is the necessary protection test; then the reasonable expectations test; then the proportionality test; then the fair balance test; and, finally, the desirability test.
  Given how long such matters take, how will the Select Committee work out the balance involved in, for example, the reasonable expectations test, which was recommended by the Deregulation Committee? The test demands that the Minister making the order must be of the opinion that it will not prevent an individual from continuing to exercise any right or freedom that he might reasonably expect to continue to exercise.
  Under the proportionality test, the imposition of any new or increased burden must be proportionate to the benefit that is expected to result. Under the fair balance test, in the case of the imposition of new or increased burdens, the Minister must be of the opinion that the provisions of an order, taken as a whole, strike a fair balance between the public interest and the rights of the individual.
  Mr. White: Will the hon. Gentleman give way?
  Mr. Steen: No, I shall not give way.
  The desirability test—a new test—was inserted into the Bill as a result of an amendment in the Lords. In the case of the imposition of a new or increased burden, the Minister must be of the opinion that it is desirable to make the order, because it either removes or reduces a burden elsewhere, or has other benefits for those currently affected by the burden. Those five tests must be instilled into the minds of every member of the Committee, and they must work out whether they should allow the amendment regulation measure to go forward.
  Conservatives Members would like to make it clear to Departments that new measures should be extended or introduced only if old measures are repealed. There would be a balance, so that each time a new or extended measure is introduced, we would get rid of another one. That is an interesting approach to regulation.
  The problem is that, if one uses any one of three words, one can get away with any rule or regulation. If one puts up one's hand and says "hygiene", people immediately say, "Let's have a new regulation." However, things have got so clean in Britain that, if one goes abroad, one gets ill. The immune system of many people in this
  112
  country has been affected by the paranoid obsession with keeping everything so clean. When our constituents go to mainland Europe, many of them become ill.
  Let us take the example of water. Water in the south-west is so pure that people going to other parts of Europe get ill because the water there is not as pure. We have gone completely haywire about hygiene. People in shops now wear plastic or cellophane gloves, but I am told that there are more germs on those gloves after half an hour than there are on the human hand.
  The hygiene laws have caused more and more people extra expense, but one would have thought that there would be fewer incidents of food poisoning as a result. in fact, there are more incidents—the cleaner we become, the more ill the majority of people get. It does not follow that introducing more hygiene rules and regulations leads to a healthier and happier society.
  Another buzzword is "security". As soon as one uses the word "security", one can pass any new rule or regulation. In addition to "hygiene" and "security", there is the term "safety". Everyone will say that we must introduce a new regulation to make something safe. Therefore, the Bill will extend and not reduce rules and regulations. They may be better, but a raft of extensions to existing rules will be introduced.
  A second aspect of the Bill worries me even more. It is about a European style civil service approach to appeal. I tabled an amendment to the Deregulation and Contracting Out Bi11 with my colleague who was the Member for Scarborough at that time. When there is a disagreement between local officials and a local business, my amendment would have meant that the matter could have gone to a local magistrates court by way of appeal. The court would have been able to decide at a local level who was right or wrong and assess whether the correct interpretation had been made.
  As I understand it, the new power in the Bill relates to the concordat that no one has mentioned even though we have been debating the issue for six hours. However, the second aspect of the Bill is all about the concordat. No one knows what it is but what was a voluntary concordat has now become enshrined in the Bill. That means that if a local business man is not happy with the rules and regulations that have been applied by a local authority to his business, he will be able to appeal to the Minister.
  When the Parliamentary Secretary, Cabinet Office winds up, it would be useful if he could tell us how a local business that is unhappy with a local authority's enforcement could contact the Minister. Will the Minister now become judge and jury, and is that against the provisions of the European Court of Human Rights? Under the Bill, a local person can appeal to the Minister for an interpretation of an Act of Parliament that has been passed through this Chamber. That is a curious new development. No one quite understands the concordat. It was a voluntary agreement, but it is now a statutory requirement. The Minister should deal with that important issue.
  Although I have lot spoken for 35 minutes like some hon. Members—good though those contributions were—I hope that I have encapsulated the essential, pithy parts of the Bill in 10 minutes. I hope that the House will find that a help.
  9.30 pm
  Mr. Richard Page: I apologise to the House, in particular to my hon. Friend the Member for South Cambridgeshire (Mr. Lansley), for not being here throughout his contribution. I had to go to a meeting of the Committee of Selection in Committee Room 12 to deal with one of the 15 or so statutory instruments that were introduced today. I can see 14 or 15 more on the Table waiting to find their way on to the statute book and to burden our businesses.
  The Bill reflects the Government's schizophrenia. The Minister for the Cabinet Office said how marvelously well the small business sector was doing, how well everything was running and what a fantastic job the better regulation taskforce was doing. She gradually slipped into arguing that the Bill was needed because the Deregulation and Contracting Out Act 1994 was not strong enough, completely forgetting why the Labour party voted against it. When the roles were reversed and I was Minister with responsibility for small business, I faced the Minister of State, Home Office, the hon. Member for Hornsey and Wood Green (Mrs. Roche), who was the, shadow Minister. She was a powerful advocate and berated us about regulations. She hammered into us and said, "Under a new Labour Government, when we sweep to power, it will be different." She was right on both counts. I was foolish enough to think that she was going to do something about regulation. I was wrong.
  There has been much talk about regulations. All I can say is that their number has risen remorselessly under this Government. I hope that the House will accept Library figures. When the Conservatives departed from office in 1997, there were 3,114 regulations. In 1999, there was a record figure of 3,694—up 15 per cent. Provisional figures for 2000 show that the Government have broken the record with 3,863 regulations. That is a huge increase, yet the Government lecture us on what should be done.
  In the past four years, regulations hive swamped small businesses. My hon. Friend the Member for Buckingham (Mr. Bercow) explained that under the previous Government, the 1994 Act dealt with 37 measures in a couple of years. Only 11 or so have been tackled in the past four years. There is a delicious irony. The most recent deregulatory measure—the. Deregulation (Sunday Dancing) Order 2000—was produced at the same time as the Bill was introduced in the other place. The Government's major achievement in four years is the deregulation of Sunday dancing. I do not know whether you are a closet Sunday dancer, Mr. Speaker, and go to tea dances, but you can now do so without fear of the long arm of the law feeling your collar and taking you away for committing a crime. That is the Government's triumph, and it reflects their conviction.
  Mr. Pike: Does the hon. Gentleman recognise that at least we dealt with Sunday dancing ? The Conservative Government tried to deal with that issue but got their solution wrong and had it rejected.
  Mr. Page: I bow to the hon. Gentleman's acknowledged expertise on Sunday dancing and I do not challenge his ability to deregulate it. When he leaves the Chamber tonight, he may do so surrounded by the warm glow of knowing that that has been his contribution to the House of Commons in the past four years.
  114
  If the Deregulation and Contracting Out Act 1994 was not strong enough despite containing the necessary powers, what was there to stop the Government working in tandem with the Deregulation Committee to ensure that if the Committee wanted to remove one regulation or more, the Whitehall sausage machine—the red tape production factory-could not produce another regulation to replace it? About 100,000 regulations have been laid on our businesses in the past 50 years.
  The Bill represents only one half of the solution to the problem. The system is a job-creation project: one part of a Department churns out and gold-plates regulations; then, two years later, after everyone has forgotten who produced the regulations and who was responsible for then, the officials use the Bill's powers to reform, repeal or recast a new set of regulations. The truth is that the Bill does nothing to stop the sausage machine of Whitehall. Even if it works—I have my doubts about whether it will—no one in Whitehall will tackle the red tape tangle. There is nothing to stop Departments from pushing out record numbers of regulations every year.
  I endorse the recommendation made by my hon. Friend the Member for South Cambridgeshire. We need an independent commission to examine all new regulations, independently assess their cost and, if necessary, say no. Then, the statutory instrument concerned could be debated by Parliament with full knowledge of the commission's serious doubts about it. That is what the Conservative party wants and the policy will appear in its manifesto.
  The Minister for the Cabinet Office gave the game away when she mentioned nil compliance costs—a balance. Surely, the purpose of the Bill is to reduce burdens on business, not merely to hold the overall burden at the same level. She is supported by the explanatory notes to the Bill issued by the Cabinet Office, which set out the balance between reducing and removing burdens far more fairly than I can. Paragraph 51, which refers to clause 1(3), states:
  "the power cannot be used to re-enact burdens, impose or increase burdens, or remove inconsistencies or anomalies, without also removing or reducing burdens."
  That is fine, but it continues:
  "However, the subsection does not make any numerical linkage between the burdens removed and those imposed, so the former need not necessarily outweigh the latter."
  After all the magnificent words up front, the truth is that the Bill offers no guarantee that there will definitely be a reduction in burdens on business.
  In plain English, rather than the language of Sir Humphrey, the main order-making power in the Bill permits an increase in the regulatory burden; unlike the 1994 Act, it does not require a reduction. All Ministers' rhetoric about new Labour's commitment to reduce the impact of regulations on activities of all sorts in the UK is at wide variance with that permissive power. It will come as no surprise to Labour Members to learn that the Conservatives will seek to amend that extraordinary latitude allowed to Ministers when the Bill is in Standing Committee. I am well aware that clause 1(1) insists on the test of proportionality—on which my hon. Friend the Member for Totnes (Mr. Steen) waxed lyrical—if an existing provision is re-enacted,
  "where the burden is proportionate to the benefit which is expected to result from the re-enactment"

  115
  or if a new provision is made by order which
  "is proportionate to the benefit which is expected to result from its creation".
  I see from the debate in another place that the Minister of State, Cabinet Office, Lord Falconer, flushed with his success at the dome, tried to argue that only a small number of people might face increased burdens if Ministers sought to
  "rebalance"—
  what a lovely, imprecise word—
  "an entire regulatory regime".[Official Report, House of Lords, 21 December 2000; Vol. 620, c. 853.]
  I fear that Lord Falconer's advocacy was met with considerable scepticism. No one can be sure that changes to entire regulatory regimes will affect only relatively small numbers of people.
  The fact is that the Bill was improved in the other place by the Opposition coming together and drafting amendments. In its original form, it could have meant added burdens, without the dropping of old ones. The amendments altered that and, fortunately, the Government have taken them on board. The amended clause 1(1)(c) means that a new regulation cannot come into force without an old one going.
  Again, I can see the stealthy hand of officialdom at work in the estimation of costs. There has been some improvement to the original Bill, but the announcement of cost estimation comes too late in the process; it is in the remit of officials, rather than of people in the real world as it is in our manifesto commitment. We would ask a commission, made up of independent business men and women and staffed by non-officials, to judge the costs of a Bill.
  However, it seems that, after public consultation, estimates of costs will appear. That is far too late in the process. The estimates should be up front and part of the consultation process. How can one consult with the public and say, "By the way, we will let you know the cost later"? I am afraid that the Bill has been introduced without consideration; it does not take our Deregulation and Contracting Out Act 1994 and make it work. The Act was not supported, and we must ask ourselves whether the Bill will be.
  In a powerful and penetrating speech, my right hon. Friend the Member for Wokingham (Mr. Redwood) said forcefully that the Bill was a cynical measure that was being introduced just before a general election to head off the howls of complaint from business men and women who have had to deal with burdens imposed by the Government. My hon. Friend the Member for South Cambridgeshire referred to all those burdens and their effect on our business men. In government, I was berated by the Labour spokesman, who said that the Labour party would do something about regulation; it would cut it and make things better. However, in four years, the Government have dealt with 11 deregulations and, at the same time, rammed though a 15 per cent. increase on the previous highest level of regulation. I am afraid that it is a case of once bitten, twice shy. I shall ask my right hon. and hon. Friends to vote for the Conservative amendment.
  9.44 pm
  The Parliamentary Secretary, Cabinet Office (Mr. Graham Swinger): We have had a full and interesting debate t n an important, powerful and perfectly formed Bill. Some contributions were longer than expected, and in my reply I shall probably not be able to deal with every point that was made. During the debate, I prepared an hour-long speech, but thanks to the major contributions from, the Opposition, I am down to a 15-minute speech.
  Two aspects of the debate surprised me. The first was that the Opposition have not accepted the principle behind the Bill. When their Conservative colleagues in the other place accepted the principle, I naively expected the Conservative party in Parliament to speak with one voice. The second point has been reiterated by several Members and is due, I believe, at best to a misunderstanding, and possibly to hon. Members being disingenuous. The Opposition have praised to the hilt the Deregulation and Contracting Out Act 1994, and we agree that it has done some useful work, but they have described as trifling and trivial a Bill that builds on it but which has a wider power.
  Yes, the 1994 Act could deal with single items of regulation that were burdensome, but do the Opposition not want to use a parliamentary process that has proved satisfactory to deal with matters such as fire regulations and weights and measures that need reforming? Those regulations are in various pieces of primary and secondary legislation, and business could benefit from that legislation being re formed. Do the Opposition want the burdens created by different regulations under different Acts to be dealt with? We certainly want the regulations to be dealt with.
  The debate has gone all over the place. Regulations cover all walks of life, and we have been taken for a walk around Europe by the hon. Member for Buckingham (Mr. Bercow). We have discussed fish, oysters, transport. gambling, dancing, lambing, pigs, building directions and telecommunications. There is almost nothing that we have not debated, so clearly I cannot respond to all the points raised.
  In general terms, to make sense of the red tape debate, policy costs must be distinguished from administration costs. That distinction has not always been apparent in the debate today. The Government make no apology for and are proud to have introduced the minimum wage, protecting workers from having to work excessively long hours and making it easier for parents to maintain a balance between the it work and family duties.
  It is extremely misleading to argue that entitlements and benefits that individuals receive constitute bureaucracy or red tape. The real cost of administering Government policies are a fraction of what has been suggested. The hon Member for Buckingham asked for facts. Here are same facts: the annual cost of all employment legislation introduced by the Department of Trade and Industry since 1997 is approximately 1 per cent. of the annual wages and salaries bill for the economy as a whole. That is just under £4 per employee per week, and almost all of that is due to providing extra benefits for workers.
  Although the debate has been comprehensive, it is notable that the ferocious debate that took place during the introduction of the Deregulation and Contracting Out Bill, as it then w is, has not been replicated. Hon.

  117
  Members have accepted the super-affirmative process that is part of that Bill. The broad order-making power, which has the effect of removing burdens, has evolved directly from the power in the 1994 Act. The reason that that has happened is relatively easy to understand. It is because of the diligence and effectiveness of the Delegated Powers and Deregulation Committee in the ocher place and the Deregulation Committee in this House. They have proved that the worries expressed by Labour Members when the 1994 Act was introduced were unfounded. The Deregulation Committee has reported five times in respect of the Bill. It did so twice as a result of initial consultation on the order-making power and three times following the Bill's publication in April 2000. Its most recent report was published last Friday. Its views have shaped the Government's thinking on aspects of the Bill such as the reform of common law. As has been repeatedly stated, the procedures set out in the Bill are based on consensus, which has largely been achieved through the Committee system.
  The Deregulation Committee's work has been truly invaluable. It made a number of recommendations, the most immediately relevant of which is that subordinate provisions orders should be made by affirmative resolution. The Government have responded by agreeing to an amendment tabled in another place by Lord Borrie to ensure that orders can stipulate whether the negative or affirmative procedure should be used. In its latest report, the Committee welcomes the commitments made by Ministers in the Lords. I am delighted to repeat those commitments, which the hon. Member for Westonsuper-Mare (Mr. Cotter) asked me to reiterate. First, I am happy to confirm that the order-making power will not be used for large and controversial measures. Secondly, the Government would not proceed with, in order against the Committee's wishes. Thirdly, the Government will report in three years' time on the procedural workings and constitutional implications of the power.
  The Bill's second power is a new reserve power to set out a code of good enforcement practice. One or two of the comments that were made showed that some hon. Members did not understand that simple point. The reserve power has not received much comment, but bad enforcement can be the most burdensome part of regulation. The light-touch nature of the power was developed with input from a consultative exercise involving enforcers and those subject to enforcement. The power is intended to counter unjustifiably inflexible or over-zealous enforcement. It allows the Government to exert pressure on enforcers who fail to apply best practice along the lines of the concordat.
  Mr. Redwood: When will the Ministry of Agriculture, Fisheries and Food provide clear, consistent, transparent and fair regulations for farmers? It is currently all over the place and is offering all sorts of different rules about the movement of animals that need to be moved.
  Mr. Stringer: I am grateful to the right hon. Gentleman for that intervention, as it gives me the chance to explain the basic misunderstanding that he demonstrated in his speech. The Bill allows a new code of practice to be introduced when it is shown over time that enforcers are not behaving reasonably and proportionately. Clearly, such provision does not apply to the emergency situation in which agriculture and farmers currently find themselves.
  118
  My hon. Friends the Members for Liverpool, Walton (Mr. Kilfoyle), for Burnley (Mr. Pike), for Eccles (Mr. Stewart), for Dumfries (Mr. Brown) and for Milton Keynes, North-East (Mr. White) — [Interruption.]
  Mr. Speaker: Order. It is only fair to allow the Parliamentary Secretary a hearing. Conversations may occur outside the Chamber.
  Mr. Stringer: My hon. Friends' contributions demonstrated the considerable understanding of the deregulatory process and of the nature of the Bill that they have gained from their participation in the proceedings of the Deregulation Committee. My hon. Friend the Member for Milton Keynes, North-East spoke about the need for objectives in the process of policy making and regulation. That is an explicit part of the regulatory impact assessment. At the start of the process, the objective of Government policy must be properly considered. Before we think about regulation, we must decide whether our aims can be achieved by self-regulation, co-regulation, codes of practice or other means.
  I think that the hon. Member for South Cambridgeshire (Mr. Lansley) got to the heart of many points. Unfortunately, he was wrong. He went through the regulations, quoted from an article that I had written for The Times, and said that the number of regulations had remained constant. In the article, I cited the number of overall regulations. Of the statutory instruments agreed in the past year, only 4 per cent. of regulations apply to business. In the last full year of the Conservative Government, the figure was 7 per cent. That means 230 regulations that put a burden on business compared with 126.
  Mr. Lansley: Let us get to the heart of the matter. Do the Government intend the measure to be used to introduce orders that have a net deregulatory effect—yes or no? If the answer is yes, will that provision be included in the Bill?
  Mr. Stringer: The Bill makes it clear that each regulatory reform order must contain a deregulatory element.
  Most Conservative Members' comments have not been about the Bill, but about regulation in general. I concede that the Government, like every other Government in the world, are not perfect at regulation. We introduced the Bill because we want to improve our performance. Clearly, Conservative Members do not want to improve or to understand the international and historical comparisons.
  Independent reports confirm that our performance on regulation compares favourably with that of other countries. According to the economic outlook of the Organisation for Economic Co-operation and Development, which was published in December 1999, the UK has the lowest product-market regulation of any OECD country. The intelligence unit of The Economist found that the UK was ranked second in the 60 largest economies in the world for places in which it was good to do business. They were rated against 70 factors, including flexibility of the labour market and openness to foreign investment. We are currently the subject of an OECD study on regulatory performance. It will establish in greater detail the effectiveness of our measures to combat over-regulation.

  119
  It is instructive to consider our performance not only internationally but historically. Comparisons with the performance and aspirations of the Conservative party are telling. The rhetoric that we have heard today matches that of Conservative Members in the past. The right hon. Member for Henley (Mr. Heseltine) said that the 1994 Act would be used hundreds of times to repeal burdensome regulations. From 1994 to 1997, it was used 37 times. In 1995, the right hon. Gentleman pledged that he would reduce the number of different business licences from more than 250. By 1997, it had increased to 365.
  The hon. Member for South-West Hertfordshire (Mr. Page), who was Minister with responsibility for small businesses, admitted in 1997 that, since the beginning of the deregulation initiative in 1994, the Department of Trade and Industry had repealed 93 regulations but had introduced 315. Between the beginning of the deregulation initiative in 1994 and the 1997 election, 13 times as many regulations were introduced as were scrapped.
  With such a record, Conservative Members should quietly and thankfully support the Bill. However, they have used it as an opportunity to break their trappist silence on the economy. Conservative Members' target has been not the complicated matter of improving the Government's regulatory performance, but improvement in workers' rights and the protection of the environment.
  The Opposition failed to light their bonfire of red tape because it was based on'a simplistic analysis of the impact of regulation on business. The Bill is one part of the Government's programme to improve regulatory performance without reversing necessary protection. I urge hon. Members to support Second Reading and to reject the amendment
  Question put, That the amendment be made:-
  The House divided: Ayes 151, Noes 284.

  Division No. 158]

  [9.59 pm

  AYES

  Ainsworth, Peter (E Surrey)

  Clappison, James

  Amess, David

  Clarke, Rt Hon Kenneth (Rushcliffe)

  Ancram, Rt Hon Michael

  Arbuthnot, Rt Hon James

  Collins, Tim

  Atkinson, David (Bour'mth E)

  Cormack, Sir Patrick

  Atkinson, Peter (Hexham)

  Cotter, Brian

  Ballard, Jackie

  Cran, James

  Berth, Rt Hon A J

  Curry, Rt Hon David

  Bell, Martin (Tatton)

  Davies, Quentin (Grantham)

  Bercow, John

  Davis, Rt Hon David (Haltemprice)

  Beresford, Sir Paul

  Day, Stephen

  Blunt, Crispin

  Duncan, Alan

  Boswell, Tim

  Duncan Smith, Iain

  Bottomley, Peter (Worthing W)

  Emery, Rt Hon Sir Peter

  Bottomley, Rt Hon Mrs Virginia

  Evans, Nigel

  Brady, Graham

  Fabricant, Michael

  Brand, Dr Peter

  Fallon, Michael

  Brazier, Julian

  Flight, Howard

  Brooke, Rt Hon Peter

  Forth, Rt Hon Eric

  Browning, Mrs Angela

  Fox, Dr Liam

  Bruce, Ian (S Dorset)

  Gale, Roger

  Burns, Simon

  Garnier, Edward

  Butterfill, John

  Gibb, Nick

  Cash, William

  Gidley, Sandra

  Chapman, Sir Sydney (Chipping Barnet)

  Gill, Christopher

  Gillen, Mrs Cheryl

  Chope, Christopher

  Gorman, Mrs Teresa

  120

  Green, Damian

  Paice, James

  Greenway, John

  Paterson, Owen

  Gummer, Rt Hon John

  Pickles, Eric

  Hague, Rt Hon William

  Portillo, Rt Hon Michael

  Hamilton, Rt Hon Sir Archie

  Prior, David

  Hammond, Philip

  Randall, John

  Hancock, Mike

  Redwood, Rt Hon John

  Harris, Dr Evan

  Rendel, David

  Harvey, Nick

  Robathan, Andrew

  Hawkins, Nick

  Robertson, Laurence (Tewk'b'ry)

  Heath, David (Somerton & Frome)

  Roe, Mrs Marion (Broxbourne)

  Hogg, Rt Hon Douglas

  Rowe, Andrew (Faversham)

  Horam, John

  Ruffley, David

  Howarth, Gerald (Aldershot)

  Russell, Bob (Colchester)

  Jack, Rt Hon Michael

  St Aubyn, Nick

  Jackson, Robert (Wantage)

  Sanders, Adrian

  Jenkin, Bernard

  Sayeed, Jonathan

  Johnson Smith, Rt Hon Sir Geoffrey

  Simpson, Keith (Mid-Norfolk)

  Smith, Sir Robert (W Ab'd'ns)

  Keetch, Paul

  Smyth, Rev Martin (Belfast S)

  Key, Robert

  Spelman, Mrs Caroline

  King, Rt Hon Tom (Bridgwater)

  Spicer, Sir Michael

  Kirkbride, Miss Julie

  Spring, Richard

  Laing, Mrs Eleanor

  Stanley, Rt Hon Sir John

  Lait, Mrs Jacqui

  Steen, Anthony

  Lansley, Andrew

  Streeter, Gary

  Leigh, Edward

  Stunell, Andrew

  Letwin, Oliver

  Swayne, Desmond

  Lewis, Dr Julian (New Forest E)

  Syms, Robert

  Lidington, David

  Tapsell, Sir Peter

  Lilley, Rt Hon Peter

  Taylor, Ian (Esher & Walton)

  Livsey, Richard

  Taylor, John M (Solihull)

  Lloyd, Rt Hon Sir Peter (Fareham)

  Taylor, Sir Teddy

  Loughton, Tim

  Townend, John

  Luff, Peter

  Tredinnick, David

  Lyell, Rt Hon Sir Nicholas

  Trend, Michael

  McIntosh, Miss Anne

  Tyler, Paul

  MacKay, Rt Hon Andrew

  Tyrie, Andrew

  Maclean, Rt Hon David

  Viggers, Peter

  McLoughlin, Patrick

  Walter, Robert

  Madel, Sir David

  Waterson, Nigel

  Malins, Humfrey

  Wells, Bowen

  Maples, John

  Whitney, Sir Raymond

  Mawhinney, Rt Hon Sir Brian

  Whittingdale, John

  May, Mrs Theresa

  Wilkinson, John

  Moore, Michael

  Winterton, Mrs Ann (Congleton)

  Moss, Malcolm

  Winterton, Nicholas (Macclesfield)

  Nicholls, Patrick

  Young, Rt Hon Sir George

  Norman, Archie

  Tellers for the Ayes:

  O'Brien, Stephen (Eddisoury)

  Mr. Geoffrey Clifton-Brown

  Ottaway, Richard

  and

  Page, Richard

  Mr. James Gray.

  NOES

  Abbott, Ms Diane

  Blackman, Liz

  Adams, Mrs Irene (Paisley N)

  Blears, Ms Hazel

  Ainger, Nick

  Blizzard, Bob

  Ainsworth, Robert (Cov'try NE)

  Blunkett, Rt Hon David

  Allen, Graham

  Boateng, Rt Hon Paul

  Anderson, Rt Hon Donald (Swansea E)

  Borrow, David

  Bradley, Keith (Withington)

  Armstrong, Rt Hon Ms Hilary

  Bradley, Peter (The Wrekin)

  Ashton, Joe

  Brinton, Mrs Helen

  Austin, John

  Brown, Russell (Dumfries)

  Bailey, Adrian

  Browne, Desmond

  Barnes, Harry

  Buck, Ms Karen

  Barron, Kevin

  Burden, Richard

  Bayley, Hugh

  Burgon, Colin

  Beckett, Rt Hon Mrs Margaret

  Butler, Mrs Christine

  Benn, Hilary (Leeds C)

  Cabom, Rt Hon Richard

  Benn, Rt Hon Tony (Chesterfield)

  Campbell, Alan (Tynemouth)

  Bennett, Andrew F

  Campbell, Ronnie (Blyth V)

  Benton, Joe

  Campbell-Savours, Dale

  Berry, Roger

  Cann. Jamie

  Best, Harold

  Caplin. Ivor

  121

  Caton, Martin

  Heppell, John

  Cawsey, Ian

  Hewitt, Ms Patricia

  Chapman, Ben (Wirral S)

  Hill, Keith

  Clapham, Michael

  Hinchliffe, David

  Clark, Rt Hon Dr David (S Shields)

  Hope, Phil

  Clark, Dr Lynda (Edinburgh Pentlands)

  Howarth, Rt Hon Alan (Newport E)

  Howarth, George (Knowsley N)

  Clarke, Charles (Norwich S)

  Howells, Dr Kim

  Clarke, Eric (Midlothian)

  Hughes, Ms Beverley (Stretford)

  Clelland. David

  Hughes, Kevin (Doncaster N)

  Clwyd, Ann

  Humble, Mrs Joan

  Cohen, Harry

  Hurst, Alan

  Coleman, Iain

  Hutton. John

  Colman, Tony

  Iddon, Dr Brian

  Connarty, Michael

  Illsley, Eric

  Corbett, Robin

  Jackson, Ms Glenda (Hampstead)

  Corston, Jean

  Jackson, Helen (Hillsborough)

  Cousins, Jim

  Jamieson, David

  Cox, Tom

  Johnson, Alan (Hull W & Hessle)

  Crausby, David

  Jones, Rt Hon Barry (Alyn)

  Cryer, John (Hornchurch)

  Jones, Helen (Warrington N)

  Cunningham, Jim (Cov'try S)

  Jones. Ms Jenny (Wolve h'ton SW)

  Davidson, Ian

  Davies, Rt Hon Denzil (Llanelli)

  Jones. Dr Lynne (Selly Oak)

  Davis, Rt Hon Terry (B'ham Hodge H)

  Jones, Martyn (Clwyd S)

  Jowell Rt Hon Ms Tessa

  Dawson, Hilton

  Joyce. Eric

  Dean, Mrs Janet

  Keeble, Ms Sally

  Denham, Rt Hon John

  Keen, Ann (Brentford & Isleworth)

  Dismore, Andrew

  Kemp, Fraser

  Dobbin, Jim

  Kennedy, Jane (Wavertree)

  Dobson, Rt Hon Frank

  Khabra, Piara S

  Donohoe, Brian H

  Kilfoyle, Peter

  Dowd, Jim

  King, Andy (Rugby & Kenilworth)

  Dunwoody, Mrs Gwyneth

  King, Ms Cona (Bethnal Green)

  Eagle, Angela (Wallasey)

  Kumar, Dr Ashok

  Eagle, Maria (L'pool Garston)

  Ladyman, Dr Stephen

  Edwards, Huw

  Lammy, David

  Efford, Clive

  Laxton, Bob

  Ennis, Jeff

  Lepper, David

  Field, Rt Hon Frank

  Leslie, Christopher

  Fisher, Mark

  Lewis, Ivan (Bury S)

  Fitzpatrick, Jim

  Lewis, Te y (Worsley)

  Fitzsimons, Mrs Lorna

  Liddell, Rt Hon Mrs Helen

  Flint, Caroline

  Linton, Martin

  Flynn, Paul

  Lloyd, Tony (Manchester C)

  Follett, Barbara

  Llwyd, Elfyn

  Foster, Rt Hon Derek

  Lock, David

  Foster, Michael J (Worcester)

  Love Andrew

  Foulkes, George

  McAvoy, Thomas

  Galloway. George

  McCabe, Steve

  George, Rt Hon Bruce (Walsall S)

  McCafferty, Ms Chris

  Gerrard, Neil

  McDonagh, Siobhain

  Gibson, Dr Ian

  Macdonald, Calum

  Godman, Dr Norman A

  McDonnell, John

  Godsiff, Roger

  McFall, John

  Goggins, Paul

  McGuire, Mrs Anne

  Gordon, Mrs Eileen

  McIsaac, Shona

  Griffiths, Jane (Reading E)

  McKenna, Mrs Rosemary

  Griffiths, Win (Bridgend)

  Mackinlay, Andrew

  Grocott, Bruce

  McNamara, Kevin

  Grogan, John

  McNulty, Tony

  Hall, Patrick (Bedford)

  MacShane, Denis

  Hanson, David

  Mactaggart, Fiona

  Healey, John

  McWalter, Tony

  Henderson, Ivan (Harwich)

  McWilliam, John

  Hendrick, Mark

  Mahon, Mrs Alice

  Hepburn, Stephen

  Mallaber, Judy

  122

  Mandelson, Rt Hon Peter

  Savidge, Malcolm

  Marsden, Gordon (Blackpool S)

  Sedgemore, Brian

  Marsden. Paul (Shrewsbury)

  Shaw, Jonathan

  Marshall, David (Shettleston)

  Sheerman, Barry

  Marshall, Jim (Leicester S)

  Sheldon, Rt Hon Robert

  Meacher, Rt Hon Michael

  Simpson, Alan (Nottingham S)

  Meale, Alan

  Skinner, Dennis

  Merron, Gillian

  Smith, Rt Hon Andrew (Oxford E)

  Michael, Rt Hon Alun

  Smith, Angela (Basildon)

  Michie, Bill (Shefld Heeley)

  Smith, Jacqui (Redditch)

  Miller, Andrew

  Smith, John (Glamorgan)

  Mitchell, Austin

  Smith, Llew (Blaenau Gwent)

  Moffatt, Laura

  Snape, Peter

  Morgan, Alasdair (Galloway)

  Soley, Clive

  Morgan, Ms Julie (Cardiff N)

  Speller, John

  Morley, Elliot

  Squire, Ms Rachel

  Morris, Rt Hon Ms Estelle (B'ham Yardley)

  Starkey, Dr Phyllis

  Steinberg, Gerry

  Morris, Rt Hon Sir John (Aberavon)

  Stevenson, George

  Stewart, Ian (Eccles)

  Mountford, Kali

  Stinchcombe, Paul

  Mowlam, Rt Hon Marjorie

  Stringer, Graham

  Mudie, George

  Stuart, Ms Gisela

  Mullin, Chris

  Sutcliffe, Gerry

  Murphy, Denis (Wansbeck)

  Taylor, Rt Hon Mrs Ann (Dewsbury)

  Murphy, Jim (Eastwood)

  Naysmith Dr Doug

  Temple-Morris, Peter

  O'Brien, Bill (Normanton)

  Thomas, Gareth (Clwyd W)

  O'Hara Eddie

  Thomas, Gareth R (Harrow W)

  Olner Bill

  Thomas, Simon (Ceredigion)

  Palmer, Dr Nick

  Tipping, Paddy

  Pearson, Ian

  Todd, Mark

  Pickthall, Colin

  Touhig, Don

  Pike, Peter L

  Trickett, Jon

  Pollard, Kerry

  Truswell, Paul

  Pond, Chris

  Turner, Dennis (Wolverh'ton SE)

  Pond Chris

  Turner, Dr Desmond (Kemptown)

  Pope. Greg

  Turner, Neil (Wigan)

  Pound, Stephen

  Twigg, Derek (Hatton

  )

  Prentice, Gordon (Pendle)

  Tynan, Bill

  Primarolo, Dawn

  Vaz, Keith

  Prosser, Gwyn

  Vis, Dr Rudi

  Purchase, Ken

  Walley, Ms Joan

  Radice, Rt Hon Giles

  Watts, David

  Rammell, Bill

  White, Brian

  Rapson, Syd

  Whitehead, Dr Alan

  Raynsford, Nick

  Wicks, Malcolm

  Robertson, John (Glasgow Anniesland)

  Williams, Rt Hon Alan (Swansea W)

  Robinson, Geoffrey (Cov'try NW)

  Williams, Alan W (E Carmarthen)

  Roche. Mrs Barbara

  Williams, Mrs Betty (Conwy)

  Rogers, Allan

  Winnick, David

  Rooker, Rt Hon Jeff

  Winterton, Ms Rosie (Doncaster C)

  Rooney, Terry

  Woodward, Shaun

  Ross, Ernie (Dundee W)

  Worthington, Tony

  Rowlands, Ted

  Wright, Tony (Cannock)

  Roy, Frank

  Ruddock, Joan

  Tellers for the Noes:

  Salter, Martin

  Mr. Mike Hall and

  Samar, Mohammad

  Mr. Clive Betts.

  Question accordingly negatived.
  Main Question put forthwith, pursuant to Standing Order No. 62 (Amendment on second or third reading), and agreed to.
  Bill accordingly read a Second time.

  Regulatory Reform Bill [Lords] (Programme)
  10.18 pm
  Mr. Stringer: I beg to move,
  That the following provisions shall apply to the Regulatory Reform Bill [Lords]:

  Regulatory Reform Bill [Lords] (Programme)

    Standing Committee
    1. The Bill shall be committed to a Standing Committee.

    2. The Standing Committee shall have leave to sit twice on the first day on which it shall meet.

    3. Proceedings in the Standing Committee shall (so far as not previously concluded) be brought to a conclusion on Thursday 29th March.

    Consideration and Third Reading
    4. Proceedings on consideration shall (so far as not previously concluded) be brought to a conclusion at Nine o'clock on the day on which those proceedings are commenced or, if that day is a Thursday, at Six o'clock on that day.
    5. Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at Ten o'clock on the day on which those proceedings are commenced or, if that day is a Thursday, at Seven o'clock on that day.
    6. Sessional Order B (Programming Committees) made by the House on 7th November 2000 shall not apply to proceedings on consideration and Third Reading.

    Lords messages
    7. Paragraphs (6) and (7) of Sessional Order A (varying and supplementing programme motions) made by the House on 7th November 2000 shall not apply to proceedings on any motion to vary or supplement this order for the purpose of allocating time to proceedings on consideration of any messages from the Lords, and the question on any such motion shall be put forthwith.
    The motion proposes that the Committee stage of the Bill should be completed by Thursday 29 March. It also provides for the Committee to sit twice on the first day. It further provides for the standard procedure for the Third Reading debate—[Interruption.]
    Mr. Speaker: Order. Hon. Members leaving the Chamber must do so quietly.
    Mr. Stringer: We believe that the motion provides adequate time for the Committee to scrutinise what is, after all, a short 15-clause Bill, which has undergone extensive pre-legislative scrutiny. Let me remind the House of that scrutiny, which consisted not only of public consultation but of scrutiny by the Deregulation Committee in this House and the Delegated Powers and Deregulation Committee in another place. As in previous debates, those Committees' reports have proved invaluable.
    Mr. Leigh: Does the Minister consider that arguments adduced on Second Reading should affect the amount of time given for the Committee stage?
    Mr. Stringer: That is a matter for the Programming Sub-Committee—but, having listened to the Second Reading debate, I am confident that the time allocated will be adequate to deal with all the points that have been raised, especially given the length of the pre-legislative scrutiny of the Bill.
    Mr. Douglas Hogg: The Minister has already expressed the opinion that we—
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    I assume that he included himself in that plural—believed that the scrutiny time was sufficient. That being so, he is in a position to answer the question asked by my hon. Friend the Member for Gainsborough (Mr. Leigh). Will he please tell us now whether he thinks that arguments raised on Second Reading affect his judgment in any way?
    Mr. Stringer: I obviously did not answer that point to the satisfaction of the hon. Member for Gainsborough (Mr. Leigh), but I answered it as clearly as I am going to. It might have been helpful to the debate—or perhaps not—if the right hon. and learned Member for Sleaford and North Hykeham (Mr. Hogg) had turned up and listened to the arguments. He was noticeable by his absence throughout the entire debate.
    The Bill has also undergone rigorous debate in another place, concentrating on its parliamentary and constitutional aspects. As a result, the Bill has been amended and now contains even stricter safeguards than before. As a result of amendments made in another place, every order must now be based on deregulatory measures, which I am sure right hon. and hon. Members will welcome.
    This is not some skeleton Bill, to be fleshed out during the parliamentary process. It is a fully thought-through product, and the Government see no need to make any further amendments to it. Therefore, the time in Committee can be spent on debating the issues in the Bill, not on considering Government amendments. We have no intention of producing any amendments in Committee at this stage.
    One of the most important features of the Programming Sub-Committee is that it gives Opposition Members the opportunity to decide on priorities. It will be for them to stipulate the amount of time that the Standing Committee will take in examining particular aspects of the Bill.
    Mr. Tim Loughton: The Minister has stipulated that he is not at all affected by the Second Reading debate and has guaranteed that the Government have no intention of proposing amendments in Committee, so what is the point of having a Committee stage?
    Mr. Stringer: The hon. Gentleman—I am sure inadvertently—misquotes me. I said that I was sure that sufficient time had been allocated by the programme motion to take care of all the points that had been made on Second Reading As I said in response to a previous intervention, it would probably have been more useful if the hon. Member for East Worthing and Shoreham (Mr. Loughton) had been present during Second Reading—his contribution might have been more apposite.
    Mr. Nicholas Winterton: I believe that the Minister is being quite helpful. I am interested in the procedures of this House, as he knows. Will he confirm that if the Programming Sub-Committee would like to have more sittings within the timetable—that is, by the time the Bill leaves Committee—the Government would be happy to agree to that to allow the Opposition parties to ensure that all their it concerns were dealt with properly in Committee?
    Mr. Stringer: That is clearly a matter for the Programming Sub-Committee and its Chairman, as the hon. Gentleman knows.

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    The Government will not stipulate the amount of time to be spent on, say, the first four clauses; that will be for Opposition Members to decide. I hope chat the House will recognise that it is not the Government who win from the programme motion. The Opposition gain from being able to set out how they want the debate to be held, and the whole House wins from added certainty about the timetabling of Bills.
    I ask the House to support the programme motion.
    10.23 pm
    Mr. Lansley: I am astonished by the Minister's assertions. In introducing his programme motion, he seemed to combine arrogance with regard to the Bill's proper scrutiny by the House with incompetence.
    The Minister of State in the other place also seemed to suggest when the Bill arrived there that it had been the subject of pre-legislative scrutiny and examination by deregulation committees. Yet in the course of its examination in the House of Lords, amendments were made to the Bill concerning parliamentary control of subordinate provisions orders, the imposition of burdens and the extent to which they needed to be removed or reduced, and the extent to which cost savings were illustrated in clause 6. A Bill that the Minister described as "perfectly formed" was certainly not so when it was introduced in another place, and it was the subject of amendments there.
    The Minister is saying that the Second Reading debate has had no impact on him. It is possible that he paid no attention to it, but in my hearing of it, a number of matters were raised—and not only by Conservative Members, which is interesting. The hon. Member for Milton Keynes, North-East (Mr. White), who is no longer with us, and the hon. Member for Dumfries (Mr. Brown) said that they believed that the Bill did not go far enough on simplification and comprehensibility. Yet the Minister seems to be discounting not only points made by Conservative Members but those made by his colleagues.
    Mr. Stringer: When my noble Friend Lord Falconer introduced the Bill in the other place, he made it clear that the Government were open to particular amendments because of the recommendations of. the Deregulation Committee in this House, as hon. Members will see if they read Lords Hansard. I said—I want the hon. Member for South Cambridgeshire (Mr. Lansley) and others to be clear about this point—that the Government have no intention of tabling amendments in Committee. We will, of course, listen as carefully as possible to the arguments put forward by Conservative and, indeed, Labour Members.
    Mr. Lansley: The mention of the Minister of State in the Lords reminds us that incompetence and arrogance seem to go together in this Government. The Minister says that the Government do not intend to table amendments, but that does not absolve them of the necessity to have regard to the extent of amendments that might be tabled in Committee by Conservative Members, Liberal Democrats or even, heaven I offend, Labour Back Benchers. Yet the Government seem to have assumed that the Committee stage can be completed by 29 March, regardless of the number of amendments that are tabled.
    That is all of a piece with the way in which this Government behave. They are not interested in what others have to say; they are interested only in passing their
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    Bill according to their timetable. As the Second Reading debate demonstrated, they want their fig leaf of deregulation to cover the nakedness of their regulatory activity over the past four years.
    Mr. Stringer: It says here.
    Mr. Lansley: It does not say that here—I just made it up.
    A number of issues were addressed in the Second Reading debate and, more importantly, as the Minister will have observed, Conservative Members moved a reasoned amendment objecting to the principle of the Bill, which is objectionable in that it is capable of being a regulatory Bill—one which imposes burdens rather than using an exceptional. important power for a specific deregulatory purpose.
    The Minister was right to say that there is now a degree of acceptance, which extends to his party as well as to ours, about the use of what the Minister described as a super-affirmative procedure for secondary legislation to amend regulatory effects of primary legislation, but Conservative Members have not reconciled themselves to that in circumstances where it could be used to impose new burdens and to free the public sector to impose additional costs or to reduce its own burdens at the expense of the private sector. We are not reconciled to the idea that that exceptional procedure should be used other than for the specific purpose of removing the burden that the state imposes on the private citizen, yet the Government plan to pursue that point.
    Having lost the vote on our reasoned amendment, we find that the Minister has no regard to the additional safeguards that we might want to propose in Committee. It is incumbent on me to give the Minister an indication of some of the measures that we would like to suggest in amendments.
    Mr. Hogg rose—
    Mr. Lansley: Before I launch into the precise detail. I happily give way to my right hon. and learned Friend.
    Mr. Hogg: My hon. Friend makes the point that the Bill may be used to impose further regulations. He might add that the order-making procedure that the House is being asked to approve will not give us the opportunity to amend any further obligations that we may be asked to agree to. The order-making procedure is all or nothing.
    Mr. Lansley: My right hon. and learned Friend is absolutely right. On Second Reading of the Deregulation and Contracting Out Act 1994, the right hon. Member for Livingston (Mr. Cook) opposed the measure from the Labour Benches principally on the ground that it contained a power to amend or even repeal Acts of Parliament. Substantial but unamendable changes could be made to primary legislation even though, in certain circumstances, formal scrutiny by the House would be limited to a 90-minute debate under the affirmative resolution procedure.
    Such changes were subject to prior scrutiny by the deregulation Committees, but scrutiny by the Members of the House was limited. I was not a Member at that time, but my right hon. and learned Friend will recall that the

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    Conservative Government thought that the procedure was justified because of the wider benefit to be derived for the business community and private citizens from the ability to reduce the overall burden of regulation. That power is to be used by the Government to take wholly new directions, although there are no safeguards in place.
    My hon. Friend the Member for Totnes (Mr. Steen) referred to the tests that have to be applied—those of proportionality, fair balance and the desirability of such measures—and the language used leads one to the question whether a Minister is of the opinion that a particular regulatory reform order is desirable. There is no constraint in the Bill that provides that a Minister can proceed only on the basis that there is a net deregulatory—
    Mr. Deputy Speaker (Mr. Michael Lord): Order. The debate is about the time allocated for proceedings in Committee. The hon. Gentleman should restrict his comments to that.
    Mr. Lansley: I am grateful, Mr. Deputy Speaker. The remarks of my right hon. and learned Friend the Member for Sleaford and North Hykeham (Mr. Hogg) tempted me.
    I emphasise that the amendments that we want to table in Committee and the question of safeguards both warrant a significant allocation of time and neither should be prejudiced by the Government's decision that consideration must be completed by 29 March. Let me give an example of what we want to scrutinise.
    On the test of proportionality, when burdens are to be imposed through the making or re-enactment of provisions, there should be a proportional benefit. However, as Baroness Buscombe said in the other place, the Bill does not deal with whether such additional burdens are necessary, and the necessity of such measures must be considered. We must also be sure that their effect will be genuinely deregulatory.
    One of the Bill's serious and principal deficiencies relates to Ministers in the other place. At the end of the debate on Second Reading, the Parliamentary Secretary, Cabinet Office was prepared to use the weasel words that every regulatory reform order would be deregulatory in effect. However, he would not answer the question whether they would have a net deregulatory effect in practice.
    Mr. Deputy Speaker: Order. The hon. Gentleman is falling into the same trap. He must direct his remarks to the time that will be spent in Committee.
    Mr. Lansley: Thank you, Mr. Deputy Speaker; I shall indeed address myself to the time. There are a number of amendments relating directly to the point that I was making; I shall certainly want to test it during the Standing Committee's discussions.
    Mr. Nicholas Winterton: Will my hon. Friend respond to the same question that I put to the Parliamentary Secretary, Cabinet Office? If in the light of amendments tabled in Standing Committee, it is clear that the number of sittings agreed to in the sittings motion is inadequate, does my hon. Friend believe that the Government will permit
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    additional sittings to ensure that all the amendments considered important by Opposition parties are properly debated?
    Mr. Lansley: I entirely take my hon. Friend's point—I hope. That should be the case—that is what the Government should do. However, the experience of the Opposition is that, on some occasions, the Government—far from making available additional sittings within the time constraints of the programme motion—have actually curtailed the number of sittings previously promised. Having listened to a debate on that subject last week, I know that my right hon. and hon. Friends realise that the Government are not to be trusted on such matters.
    Although the Parliamentary Secretary, Cabinet Office says that the Bill is small, the significance of the provisions that we have to discuss is not small. The need for simplification of legislation in general was raised by hon. Members on both sides of the House on Second Reading. Such simplification is not present in the Bill, although language on modernisation might intrude if members of the De regulation Committee had their way. The consideration of simplification is one of the safeguards that must be built into the legislation. That will need further time fur discussion.
    We also need to ensure that there are safeguards on powers introduced both as regards the extension of criminal sanctions and as regards the extent to which Ministers are able to incur expenditure under the legislation. Both are curious matters for contemplation under a deregulatory measure. Hon. Members on both sides of the House will want to table amendments to ensure that there ate safeguards on changes to primary legislation that would have the effect of changing criminal sanctions; such measures should be appropriately circumscribed.
    The Committee may want to consider not only amendments to existing clauses—the length of the Bill in terms of the number of clauses is not an absolute constraint—but one or more new clauses. For example, the review of regulatory reform orders and of the legislation itself has been the subject of some undertakings from Ministers, but it has not been built into the Bill. The Committee should certainly examine those matters in the form of new clauses. My colleagues—and, I suspect, business organisations—attach considerable importance to setting up some form of review of regulatory reform orders after a period, so as to determine whether they give rise to the cost and savings benefits and disbenefits that will be anticipated in the documents to be laid before the House under clause 6.
    The whole scope of consultation, as well as internal parliamentary scrutiny, continues to give us serious cause for concern. The active involvement of external organisations in securing scrutiny of the legislation and of regulatory reform orders before they are even considered by the Select Committees is integral to the success of the whole deregulation process. In that respect, it is significant that clause 6 gives quite detailed provisions as to what should be presented in the document laid before Parliament, although there is more to say on regulatory impact assessments. Clause 5 provides for consultation

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    external to Parliament. Business organisations should have much of the same information; we hope to table amendments to that effect.
    Mr. Pike: Does the hon. Gentleman think that he might not have had a problem with time if Conservative members of the Deregulation Committee had taken part in the consideration of the draft Bill, rather than boycotting the proceedings?
    Mr. Lansley: The hon. Gentleman simply repeats remarks that he made on Second Reading. The simple fact of the matter is that Minister did not take on board some of the Deregulation Committee's proposals. For example, the hon. Gentleman could have told us about the reasons why the Government did not choose to include a provision on modernisation and simplification, which the Deregulation Committee wanted to come within the scope of regulatory reform orders. So there are many issues to be discussed.
    Although the Bill is short, it is highly significant. It not only has wide constitutional implications but could seriously affect a lot of legislation, so it is important that we get it right. The House has given it a Second Reading and, in due course, it should become an Act that is as near as possible to the objective, contained in the Deregulation and Contracting Out Act 1994, of providing an exceptional power to deliver a specific deregulatory purpose. We intend to use all the time available in Committee to table amendments to improve the Bill, in so far as the Government will give us the opportunity to do so.
    10.41 pm
    Mr. Paul Tyler: The very fact that the Conservative spokesman has run into difficulty in trying to avoid rehearsing the arguments on the substance of the Bill shows how ridiculous programme motion debates have become. That, I fear, is largely because of the way in which the Government have handled the business of the House, rather than being the responsibility of the Opposition parties which, obviously, can have only a limited impact on such motions.
    I shall stick to the subject of the programme motion itself. Clearly, the way in which the Parliamentary Secretary introduced it was itself rather peculiar. First he said—I cannot precisely repeat his words, but I think that I paraphrase accurately—that he could not envisage circumstances in which the Government would introduce amendments. However, he slipped in the phrase, "at present". I am sure that we shall see that qualification when we read Hansard tomorrow morning. When he was challenged on that point, he made another statement, which was slightly different.
    What is so intrinsically absurd about programme motions like this is that, before the Committee of Selection has even appointed the Standing Committee's members or its Chairman and before the Programming Sub-Committee has had an opportunity to analyse the issues raised on Second Reading—let alone to look at any representation made from outside the House since the Bill's consideration in the other place—the Government see fit to put an end date on the Bill's consideration in Committee. That is patently, intrinsically absurd, and it is unnecessary.
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    This week, I hope to put some proposals to the Select Committee on the Modernisation of the House of Commons to discover whether we cannot break the ludicrous logjam of programme motions. I appeal to those on both Front Benches carefully to consider ways in which programme motions can proceed consensually, to give them the real impact that they were intended to have when they were first proposed by the right hon. Member for East Devon (Sir P. Emery) in his capacity as Chairman of the Select Committee on Procedure in the previous Parliament, and by the Modernisation Committee in this Parliament.
    I very much hope that Back Benchers on both sides of the House, who must recognise what a silly farce programme motions have become, will exert pressure on those on their Front Benches to discover whether we cannot make progress. Some Members think that we can make no progress on anything until we are the other side of the general election, but I remind them it is possible that, instead of Dissolution taking place in 13 days' time, it could still be 13 months away.
    We simply cannot go on for another 13 months with the current absurdities that have been put before us tonight, and night after night, with programme motions. I hope therefore that in considering the proposals, all members of the Modernisation Committee, on both sides of the House, will be prepared to discover whether we cannot find some way through.
    There is an additional reason: we cannot wait until the other side of polling day to establish what Sessional Orders may be appropriate to the new Parliament. So it is important to try to achieve a consensus on both sides of the House on how to improve the situation. Certainly, the present arrangement brings no credit on the House. These 45-minute debates have become increasingly sterile—a genuine dialogue of the deaf—and they have not prepared the House for better management of its business.
    Effective scrutiny depends on the Opposition parties having an opportunity to say how the detailed issues should be addressed and how much time should be given to the particular parts of a Bill. I accept that the Government have a right to seek to get their business out of Committee by an end date. However, it is totally unnecessary to table the type of motion that is before the House tonight. I very much hope that, in the next few days, we might seek to make progress so that at least in the new Parliament—be that in a month or two or 14 months or so—we can bring credit to the way in which the House does its business.
    10.45 pm
    Mr. Douglas Hogg: I rise once again to oppose the principle of a programme motion. Those on the Government Front Bench need to understand that there is no consent to the process on which they are embarking. They also need to understand that the lack of consent is perfectly genuine. I have been in this place a long time, so I recognise that Members of Parliament often express views that are, on the whole, superficial. One is entitled to ask, "Do they really mean it?" However, we really do mean it when we say that the current process of timetabling is deeply unacceptable to us.
    The process is unacceptable for a variety of reasons that I shall outline shortly. However, the consequence is critically important. If a sizeable portion of the House does not accept

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    a process, that process has no legitimacy. The House can proceed only if we have what might be broadly defined as genuine acquiesence. There is no genuine acquiesence in the process of timetabling; and the consequences of such a lack of acquiesence are actions, such as those effected by my right hon. Friend the Member for Maidstone and The Weald (Miss Widdecombe), that demonstrate the House's collective disquiet at the process on which the Government are embarking.
    This is an important Bill. I shall not discuss it because you would call me to order, Mr. Deputy Speaker, but it will give the Government a wide discretionary power to change or to disapply primary legislation. That is a constitutional innovation. I, for one, find it passing strange that Third Reading should permit but one hour of debate on a measure of such constitutional importance.
    The hon. Member for North Cornwall (Mr. Tyler) made the point that we need to consider whether it might be possible to reach a consensus on timetabling. The answer is that we might be able to do so, but that has to be on the basis that there is genuine time for discussion. I have been in this place a long time and, like others, I know that from time to time Members abuse the processes of the House. When there is a genuine feeling that the House's processes are being abused, the Government will find that they have tacit support for intervention by way of timetabling or closure even though hon. Members may go through the motions of opposition. Members, however, will not accept timetabling in advance before there is abuse. Government Members must accept that we will never, ever accept artificial timetabling, although we will accept timetabling when there is abuse. However, it will always be a matter of judgment as to when there is or is not abuse.
    The Government must also understand that the Committee and Report stages are important. It is all very well to say that this is a small Bill, so the House should just accept it. However, the process of scrutinising legislation contains certain distinct elements. First, we have to consider whether the principle is right. I do not think that it is in this case, because of the constitutional implication—but let us assume that I am wrong. We then have to consider the language in which the legislation is couched. One of our functions as Members of Parliament is to try to ensure that we do not pass legislation that is inherently nonsensical or which gives rise to unforeseen problems. We can only understand that by scrutinising it extensively in Committee.
    There is an additional matter to consider which arises from such a debate. The Bill is supposed to enable us to remove, by order, the burdens of regulation. Hon. Members will want to identify cases in Committee or on Report of regulations that are biting on their constituents. They will do that by tabling amendments that draw specific attention to a class of abuse or regulation.
    Mr. Bercow: Does my right hon. and learned Friend agree that it is not merely the number of clauses that counts, but their scope, reach and potential cost? Notwithstanding what the Parliamentary Secretary says about not intending to table amendments, is it not the case that many other people may want to? Does my right hon. and learned Friend accept that the subordinate provisions
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    order in clause 4—on which the Parliamentary Secretary was notably silent—is highly controversial and should be submitted to extensive debate?
    Mr. Hogg: My hon. Friend identifies three major considerations, the second of which is the most important. He draws attention to the fact that the Government have no intention of tabling amendments—as if that were a conclusive argument. I bet they will table amendments. I have been in the House and in government for much longer than the Parliamentary Secretary and the chance of his not tabling amendments is very small. However, I do not care what he does. What concerns me is that my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer) may want to table an amendment.
    Mr. John Gummer: Is my right hon. and learned Friend aware that the Minister for the Cabinet Office has been trying, from a sedentary position, to get him to stop speaking even though she has spoken a great deal herself and we have only 45 minutes in which to discuss the motion?
    Mr. Hogg: The right hon. Lady has prattled throughout her time in the House. I heard background noises, but fortunately I am rather deaf. I tried to see who was making the funny little noise and I am glad to learn that it was the Minister, because that means I do not have to worry about what was going on.
    My right hon. Friend is right. We are not concerned primarily with whether the Government want to table amendments. What interests us is whether Back Benchers or Front Benchers of different parties want to do that and articulate their constituents' concerns. The Parliamentary Secretary's attitude is: if the Government do not want to table amendments, does it matter that others might want to? Yes, it does. That is why there is no consent in the House.
    I have said before that there is an implied bargain in a democracy between Parliament—the legislature—and the electorate. If the electorate are to accept policy and legislation that imposes burdens on them, they do so on the basis that their representatives in Parliament have been given an opportunity, which they have taken up, to scrutinise legislation. If the Government deprive Parliament of that opportunity, they will destroy the bargain and undermine the basis on which the country accepts the burdens that they impose.
    Mr. Leigh: On the electorate, does my right hon. and learned Friend think that if we continue to muzzle Parliament, the public will become less interested in it and know less about it? It was instructive tonight that when a contestant on the popular programme "Who Wants to be a Millionaire?" was asked to name the Speaker of the House of Commons, neither he nor the audience had any idea. They were given four choices—
    Mr. Deputy Speaker: Order. I do not expect the right hon. and learned Gentleman to respond to that intervention.
    Mr. Hogg: I understand that the point made by my hon. Friend the Member for Gainsborough (Mr. Leigh) is somewhat embarrassing to the Chair, but he is right: if the House is deprived of an opportunity either to scrutinise

    133
    legislation or to articulate the concerns of its constituency, no one should be surprised if that constituency—the electorate—does not give a damn about us.
    That is what is happening. The Government are, by deliberate policy, muzzling the House. That is a scandal. Let me tell the Minister for the Cabinet Office that I shall be here long after she has gone, and I shall make it my business consistently and persistently to oppose timetable motions, which I believe are a denial of democracy.
    10.56 pm
    Mr. Nicholas Winterton: I am not, in principle, against programming. I want it to work. I share the view expressed tonight by the spokesman for the Liberal Democrats, the hon. Member for North Cornwall (Mr. Tyler): the House was right to seek to use its time better. Unlike my right hon. and learned Friend the Member for Sleaford and North Hykeham (Mr. Hogg), I do not believe that people abuse the House. I think that they use the current procedures of the House as they think fit, which is wholly legitimate.
    To the Minister I put the question that I raised in an intervention: will he give an assurance that if the Opposition parties believe that, within the programme motion, more sittings of the Standing Committee are necessary, in no circumstances will the Government use their majority on the Committee to deny it the opportunity to have additional sittings? I hope that the Leader of the House and the Government accept the unique position of the Chairman of a Standing Committee who seeks to represent the interests of all members of that Committee, including members of the governing party whose views put them in a minority in that party, so as to ensure that all aspects of the Bill are properly considered by right hon. and hon. Members on both sides. As my right hon. and learned Friend the Member for Sleaford and North Hykeham says, to do otherwise is to deny the true scrutiny role of the House of Commons.
    Question put:—
    The House divided: Ayes 265, Noes 43.

    Division No. 159]

    [10.57 pm

    AYES

    Abbott, Ms Diane

    Bradley, Keith (Withington)

    Adams, Mrs Irene (Paisley N)

    Bradley, Peter (The Wrekin)

    Ainger, Nick

    Brinton, Mrs Helen

    Ainsworth, Robert (Cov'try NE)

    Brown, Russell (Dumfries)

    Allen, Graham

    Browne, Desmond

    Anderson, Rt Hon Donald (Swansea E)

    Buck, Ms Karen

    Burden, Richard

    Armstrong, Rt Hon Ms Hilary

    Burgon, Colin

    Ashton, Joe

    Butler, Mrs Christine

    Austin, John

    Campbell Alan (Tynemouth)

    Bailey, Adrian

    Campbell-Savours, Dale

    Barnes, Harry

    Cann, Jamie

    Barron, Kevin

    Caplin, Ivor

    Bayley, Hugh

    Caton, Martin

    Beckett, Rt Hon Mrs Margaret

    Cawsey,Ian

    Benn, Hilary (Leeds C)

    Chapman, Ben (Wirral S)

    Bennett, Andrew F

    Clapham, Michael

    Benton, Joe

    Clark, Rt Hon Dr David (S Shields)

    Berry, Roger

    Clark, Dr Lynda (Edinourgh Pentlands)

    Best, Harold

    Blackman, Liz

    Clarke, Charles (Norwich S)

    Blears, Ms Hazel

    Clelland, David

    Blizzard, Bob

    Clwyd, Ann

    Boateng, Rt Hon Paul

    Cohen, Harry

    Borrow, David

    Coleman, Iain

    134

    Colman, Tony

    Keen, Ann (Brentford & Isleworth)

    Connarty, Michael

    Kemp, Fraser

    Corston, Jean

    Kennedy, Jane (Wavertree)

    Cousins, Jim

    Khabra, Piara S

    Cox, Tom

    Kilfoyle, Peter

    Crausby, David

    King, Andy (Rugby & Kenilworth)

    Cryer, John (Hornchurch)

    King, Ms Oona (Bethnal Green)

    Cunningham, Jim (Cov'try S)

    Kumar, Dr Ashok

    Davidson, Ian

    Ladyman, Dr Stephen

    Davies, Rt Hon Denzil (Llanelli)

    Lammy, David

    Davis, Rt Hon Terry (B'ham Hodge H)

    Laxton, Bob

    Lepper, David

    Dawson, Hilton

    Leslie, Christopher

    Dean, Mrs Janet

    Lewis, Ivan (Bury S)

    Dismore, Andrew

    Lewis, Terry (Worsley)

    Dobbin, Jim

    Liddell, Rt Hon Mrs Helen

    Dobson, Rt Hon Frank

    Linton, Martin

    Donohoe, Brian H

    Lloyd, Tony (Manchester C)

    Dowd, Jim

    Lock, David

    Eagle, Maria (L'pool Garston)

    Love, Andrew

    Edwards, Huw

    McAvoy, Thomas

    Efford, Clive

    McCabe, Steve

    Ennis, Jeff

    McCafferty, Ms Chris

    Field, Rt Hon Frank

    McDonagh, Siobhain

    Fisher, Mark

    Macdonald, Calum

    Fitzpatrick, Jim

    McDonnell, John

    Fitzsimons, Mrs Lorna

    McFall, John

    Flint, Caroline

    McGuire, Mrs Anne

    Flynn, Paul

    Mclsaac, Shona

    Follett, Barbara

    McKenna, Mrs Rosemary

    Foster, Rt Hon Derek

    Mackinlay, Andrew

    Foster, Michael J (Worcester)

    McNamara, Kevin

    Foulkes, George

    McNulty, Tony

    Galloway, George

    MacShane, Denis

    George, Rt Hon Bruce (Walsall S)

    Mactaggart, Fiona

    Gerrard, Neil

    McWalter, Tony

    Gibson, Dr Ian

    McWilliam, John

    Godman, Dr Norman A

    Mahon, Mrs Alice

    Godsiff, Roger

    Mallaber, Judy

    Goggins, Paul

    Mandelson, Rt Hon Peter

    Gordon, Mrs Eileen

    Marsden, Gordon (Blackpool S)

    Griffiths, Jane (Reading E)

    Marsden, Paul (Shrewsbury)

    Griffiths, Win (Bridgend)

    Marshall, David (Shettleston)

    Grocott, Bruce

    Marshall, Jim (Leicester S)

    Grogan, John

    Martlew, Eric

    Hall, Patrick (Bedford)

    Meacher, Rt Hon Michael

    Hanson, David

    Meale, Alan

    Healey, John

    Merron, Gillian

    Henderson, Ivan (Harwich)

    Michael, Rt Hon Alun

    Hendrick, Mark

    Michie, Bill (Shefld Heeley)

    Hepbum, Stephen

    Miller, Andrew

    Heppell, John

    Mitchell, Austin

    Hewitt, Ms Patricia

    Moffatt, Laura

    Hill, Keith

    Morgan, Ms Julie (Cardiff N)

    Hinchliffe, David

    Morley, Elliot

    Hope, Phil

    Morris, Rt Hon Ms Estelle (B'ham Yardley)

    Howarth, Rt Hon Alan (Newport E)

    Howarth, George (Knowsley N)

    Morris, Rt Hon Sir John (Aberavon)

    Howells, Dr Kim

    Hughes, Ms Beverley (Stretford)

    Mountford, Kali

    Hughes, Kevin (Doncaster N)

    Mowlam, Rt Hon Marjorie

    Humble, Mrs Joan

    Mudie, George

    Hurst, Alan

    Mullin, Chris

    Hutton. John

    Murphy, Denis (Wansbeck)

    Iddon, Dr Brian

    Murphy, Jim (Eastwood)

    Illsley, Eric

    Naysmith, Dr Doug

    Jackson, Helen (Hillsborough)

    O'Brien, Bill (Normanton)

    Johnson, Alan (Hull W & Hessle)

    O'Hara, Eddie

    Jones, Rt Hon Barry (Alyn)

    Olner, Bill

    Jones, Helen (Warrington N)

    Palmer, Dr Nick

    Jones, Ms Jenny (Wolverh'ton SW)

    Pearson, Ian

    Pickthall, Colin

    Jones, Dr Lynne (Selly Oak)

    Pike, Peter L

    Jones, Martyn (Clwyd S)

    Pollard, Kerry

    Jowell, Rt Hon Ms Tessa

    Pond, Chris

    Keeble, Ms Sally

    Pope, Greg

    135

    Pound, Stephen

    Stewart, Ian (Eccles)

    Prentice, Gordon (Pendle)

    Stinchcombe, Paul

    Primarolo, Dawn

    Stringer, Graham

    Prosser, Gwyn

    Stuart, Ms Gisela

    Purchase, Ken

    Sutcliffe, Gerry

    Radice, Rt Hon Giles

    Taylor, Rt Hon Mrs Ann (Dewsbury)

    Rammell, Bill

    Rapson, Syd

    Temple-Morris, Peter

    Raynsford, Nick

    Thomas, Gareth (Clwyd W)

    Robertson, John (Glasgow Anniesland)

    Thomas, Gareth R (Harrow W)

    Tipping, Paddy

    Roche, Mrs Barbara

    Todd, Mark

    Rooker, Rt Hon Jeff

    Touhig, Don

    Rooney, Terry

    Trickett, Jon

    Ross, Ernie (Dundee W)

    Truswell, Paul

    Rowlands, Ted

    Turner, Dennis (Wolverh'ton SE)

    Roy, Frank

    Turner, Dr Desmond (Kemptown)

    Ruddock, Joan

    Turner, Neil (Wigan)

    Salter, Martin

    Twigg, Derek (Halton)

    Sarwar, Mohammad

    Tynan, Bill

    Savidge, Malcolm

    Vaz, Keith

    Shaw, Jonathan

    Vis, Dr Rudi

    Sheerman, Barry

    Walley, Ms Joan

    Short, Rt Hon Clare

    Watts, David

    Simpson, Alan (Nottingham S)

    White, Brian

    Skinner, Dennis

    Whitehead, Dr Alan

    Smith, Rt Hon Andrew (Oxford E)

    Williams, Rt Hon Alan (Swansea W)

    Smith, Angela (Basildon)

    Smith, Jacqui (Redditch)

    Williams, Alan W (E Carmarthen)

    Smith, John (Glamorgan)

    Williams, Mrs Betty (Conwy)

    Smith, Llew (Blaenau Gwent)

    Winnick, David

    Snape, Peter

    Winterton, Ms Rosie (Doncaster C)

    Soley, Clive

    Woodward, Shaun

    Spellar, John

    Worthington, Tony

    Squire, Ms Rachel

    Starkey, Dr Phyllis

    Tellers for the Ayes:

    Steinberg, Gerry

    Mr. Clive Betts and

    Stevenson, George

    Mr. Mike Hall.

    NOES

    Ainsworth, Peter (E Surrey)

    Evans, Nigel

    Amess, David

    Fabricant, Michael

    Ancram, Rt Hon Michael

    Fallon, Michael

    Arbuthnot, Rt Hon James

    Flight, Howard

    Atkinson, David (Bour'mth E)

    Forth, Rt Hon Eric

    Baldry, Tony

    Fox, Dr Liam

    Beith, Rt Hon A J

    Gale, Roger

    Bell, Martin (Tatton)

    Garnier, Edward

    Bercow, John

    Gibb, Nick

    Beresford, Sir Paul

    Gill, Christopher

    Blunt, Crispin

    Gillan, Mrs Cheryl

    Boswell, Tim

    Gorman, Mrs Teresa

    Bottomley, Peter (Worthing W)

    Green, Damian

    Bottomley, Rt Hon Mrs Virginia

    Greenway, John

    Brady, Graham

    Gummer, Rt Hon John

    Brooke, Rt Hon Peter

    Hamilton, Rt Hon Sir Archie

    Browning, Mrs Angela

    Hammond, Philip

    Bruce, Ian (S Dorset)

    Hancock, Mike

    Bums, Simon

    Harvey, Nick

    Butterfill, John

    Hawkins, Nick

    Cash, William

    Heath, David (Somerton & Frome)

    Chapman, Sir Sydney (Chipping Barnet)

    Hogg, Rt Hon Douglas

    Horam, John

    Chope, Christopher

    Howard, Rt Hon Michael

    Clappison, James

    Howarth, Gerald (Aldershot)

    Clifton-Brown, Geoffrey

    Jack, Rt Hon Michael

    Collins, Tim

    Jackson, Robert (Wantage)

    Cormack, Sir Patrick

    Jenkin, Bernard

    Cran, James

    Johnson Smith, Rt Hon Sir Geoffrey

    Curry, Rt Hon David

    Davies, Quentin (Grantham)

    Keetch, Paul

    Davis, Rt Hon David (Haltemprice)

    King, Rt Hon Tom (Bridgwater)

    Day, Stephen

    Lait, Mrs Jacqui

    Duncan, Alan

    Lansley, Andrew

    Duncan Smith, Iain

    Leigh, Edward

    Emery, Rt Hon Sir Peter

    Letwin, Oliver

    136

    Lewis, Dr Julian (New Forest E)

    Sanders, Adrian

    Lidington, David

    Sayeed, Jonathan

    Lilley, Rt Hon Peter

    Shepherd, Richard

    Livsey, Richard

    Simpson, Keith (Mid-Norfolk)

    Lloyd, Rt Hon Sir Peter (Fareham)

    Smith, Sir Robert (W Ab'd'ns)

    Llwyd, Elfyn

    Smyth, Rev Martin (Belfast S)

    Loughton, Tim

    Spicer, Sir Michael

    Luff, Peter

    Spring, Richard

    Lyell, Rt Hon Sir Nicholas

    Stanley, Rt Hon Sir John

    McIntosh, Miss Anne

    Steen, Anthony

    Maclean, Rt Hon David

    Streeter, Gary

    McLoughlin, Patrick

    Stunell, Andrew

    Madel, Sir David

    Swayne, Desmond

    Malins, Humfrey

    Syms, Robert

    Maples, John

    Tapsell, Sir Peter

    Maude, Rt Hon Francis

    Taylor, Ian (Esher & Walton)

    Mawhinney, Rt Hon Sir Brian

    Taylor, John M (Solihull)

    May, Mrs Theresa

    Taylor, Sir Teddy

    Morgan, Alasdair (Galloway)

    Thomas, Simon (Ceredigion)

    Moss, Malcolm

    Townend, John

    Nicholls, Patrick

    Tredinnick, David

    Norman, Archie

    Trend, Michael

    O'Brien, Stephen (Eddisbury)

    Tyler, Paul

    Ottaway, Richard

    Tyrie, Andrew

    Page, Richard

    Viggers, Peter

    Paice, James

    Walter, Robert

    Paterson, Owen

    Waterson, Nigel

    Pickles, Eric

    Wells, Bowen

    Portillo, Rt Hon Michael

    Whitney, Sir Raymond

    Prior, David

    Whittingdale, John

    Randall, John

    Wilkinson, John

    Redwood, Rt Hon John

    Winterton, Mrs Ann (Congleton)

    Rendel, David

    Winterton, Nicholas (Macclesfield)

    Robathan, Andrew

    Yeo, Tim

    Young, Rt Hon Sir George

    Robertson, Laurence (Tewk'b'ry)

    Roe, Mrs Marion (Broxbourne)

    Tellers for the Noes:

    Ruffley, David

    Mr. James Gray and

    Russell, Bob (Colchester)

    Mr. Peter Atkinson.

    Question accordingly agreed to.
    Ordered,
    That the following provisions shall apply to the Regulatory Reform Bill [Lords]:

    Standing Committee
    1. The Bill shall be committed to a Standing Committee.

    2. The Standing Committee shall have leave to sit twice on the first day on which it shall meet.

    3. Proceedings in the Standing Committee shall (so far as not previously concluded) be brought to a conclusion on Thursday 29th March.

    Consideration and Third Reading
    4. Proceedings on consideration shall (so far as not previously concluded) be brought to a conclusion at Nine o'clock on the day on which those proceedings are commenced or, if that day is a Thursday, at Six o'clock on that day.
    5. Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at Ten o'clock on the day on which those proceedings are commenced or, if that day is a Thursday, at Seven o'clock on that day.
    6. Sessional Order B (Programming Committees) made by the House on 7th November 2000 shall not apply to proceedings on consideration and Third Reading.

    lords messages
    7. Paragraphs (6) and (7) of Sessional Order A (varying and supplementing programme motions) made by the House on 7th November 2000 shall not apply to proceedings on any motion

    137
    to vary or supplement this order for the purpose of allocating time to proceedings on consideration of any messages from the Lords, and the question on any such motion shall be put forthwith.

    REGULATORY REFORM BELL [LORDS] [MONEY]
    Queen's recommendation having been signified—
    Motion made, and Question put forthwith, pursuant to Standing Order No. 52(1)(a) (Money resolutions and ways and means resolutions in connection with bills),
    That, for the purposes of any Act resulting from the Regulatory Reform Bill [Lords], it is expedient to authorise the payment out of money provided by Parliament of—
    (a) any expenses incurred by a Minister of the Crown or government department in consequence of orders under the Act, and
    (b) any increase attributable to orders under the Act in the sums which under any other Act are payable out of money so provided. — [Mr. Clelland.]
    Question agreed to.

    European Security and Defence Policy
    11.10 pm
    The Minister of State, Foreign and Commonwealth Office (Mr. Keith Vaz): I beg to move,
    That this House takes note of the unnumbered Explanatory Memorandum submitted by the Foreign and Commonwealth Office on 27th November 2000 relating to the Presidency Report to the Nice European Council on the Common European Security and Defence Policy (document 14056/3/00) and the three unnumbered Explanatory Memoranda submitted by the FCO on 22nd and 23rd January relating to the establishment of permanent CESDP bodies; welcomes the Government's approach to a Common European Security and Defence Policy; and supports the Government's intention to pursue this initiative in the EU and in close co-operation with NATO.
    The motion stands in my name and those of my right hon. and hon. Friends. I welcome the opportunity to set out the Government's position on this important issue. I shall explain why the agreements reached at the Nice European Council— [Interruption.]
    Mr. Deputy Speaker (Mr. Michael Lord): Order. Hon. Members must not— [Interruption.] Order. Hon. Members cannot wave papers and bob up and down in their seats while the Minister is addressing the House.
    Mr. Vaz: I am delighted that I have such a large following that Opposition Members have turned out for this debate.
    Mr. Crispin Blunt: On a point of order, Mr. Deputy Speaker. The Minister introduced the motion by saying that it stood in his name and those of his hon. Friends, but none of his hon. Friends appear on the Order Paper.
    Mr. Deputy Speaker: That is not a point of order.
    Mr. Vaz: I shall explain why the agreements reached at the Nice European Council and the subsequent decisions of the January General Affairs Council represent a good outcome for Britain, Europe and NATO.
    The House will recall that the European Union's security and defence policy results from an initiative launched by my right hon. Friend the Prime Minister in 1998. The goals of that initiative have not changed and are fully reflected in the agreements reached at Nice. We want to create a Europe where nations invest in better military capabilities. We want to strengthen Europe's contribution to NATO and to enable Europeans to act where NATO as a whole is not involved.
    Nice represented a major step towards securing those goals. The Council agreed on permanent structures for EU political and military bodies, and on inclusive arrangements to involve non-member states in European security and defence policy. It proposed comprehensive consultation and co-operation agreements between the EU and NATO.
    The results of Nice have been widely welcomed. The new United States Administration support the emphasis on capabilities and the relationship with NATO. On 23 February at Camp David, President Bush said:
    "The United States welcomes the European Union's European Security and Defence Policy, intended to make Europe a stronger and more capable partner in deterring and managing crises affecting the security of the Transatlantic community."

    139
    Although the ESDP has been welcomed by the United States, its domestic reception here has, at times, been mixed. I fear that a great deal of that is down to misunderstandings created by the Conservative party, so I welcome this opportunity to put the record straight.
    The Nice report spells out what the ESDP is and, just as importantly in the light of some British reactions, what it is not. The second paragraph of the report could not be clearer. It states that EU nations will act
    "where NATO as a whole is not engaged".
    EU nations will carry out the Petersberg tasks,
    "humanitarian and rescue tasks, peace-keeping tasks and tasks of combat forces in crisis management, including peace-making".
    In other words, the EU will not be involved in war-fighting or collective defence; those remain with NATO alone.
    Hon. Members might like to recall that the Petersberg tasks were agreed by the previous Government as the scope of activity for the Western European Union, so it is somewhat hypocritical to criticise the European Union for being ready to take on the same roles. Moreover, it is worth recalling that the Maastricht treaty signed up EU member states not only to the prospect of a common EU defence policy, but to "a common defence". It is worth reminding the House that one of the Members who signed the Maastricht treaty was the right hon. Member for Horsham (Mr. Maude), who is now shadow Foreign Secretary. Those who sound completely false alarm bells about the threat to NATO were happy to sign up to the prospect of the EU replacing NATO.
    The Government have changed the perspective by taking the lead in European defence rather than taking fright. We have shaped the debate and designed the policy in a way that ensures that NATO's pre-eminent role remains unchanged. To make that clear, the report states:
    "NATO remains the basis of the collective defence of its members and will continue to play an important role in crisis management".
    We have only to look to Bosnia and Kosovo for confirmation of the latter point.
    The report also makes it clear that there is no such thing as a European army. It states:
    "This does not involve the establishment of a European army. The commitment of national resources by Member States to such operations will be based on their sovereign decisions.
    Thus the Nice treaty, agreed under the Government, establishes European defence as NATO-friendly and intergovernmental. The House will agree that that is a significant improvement on the open door to a common EU defence that was accepted at Maastricht by the self-proclaimed guardians of NATO and UK sovereignty.
    I have clarified what the ESDP is not; I shall now explain what it is
    Mr. Iain Duncan Smith: Will the Minister give way?
    Mr. Vaz: I am delighted to give way to the hon. Gentleman, who, as well as being shadow Secretary of State for Defence, has taken over the role of shadow Foreign Secretary from the right hon. Member for
    140
    Horsham. The hon. Gentleman went to Washington to pour poison into the ears of the Administration. That caused our difficulties.
    Mr. Duncan Smith: The Minister claims much credit for moves away from Maastricht and other treaties. Why, in 1997, did the Prime Minister describe the proposals to which the Minister signed up at St. Malo and Nice as "ill-judged transplant" operations, which he voted out?
    Mr. Vaz: Let us begin by paying tribute to the right hon. Member for Horsham, who signed the Maastricht treaty in 1992, and to Sir Malcolm Rifkind. who agreed the Petersberg tasks the next year. That is where European defence originated. The continuation of that policy at St. Malo began under the previous Government.
    Mr. Duncan Smith indicated dissent.
    Mr. Vaz: I know that the hon. Gentleman does not want to take credit for it, but he must. He must also give due credit to the right hon. Member for Horsham.
    First and foremost, European defence is about more effective European armed forces. It is about enhancing Europe's contribution to NATO, strengthening our ability to support United Nations or Organisation for Security and Co-operation in Europe operations, and making it possible for EU nations to respond to crises.
    Mr. Michael Howard: Will the Minister give way?
    Mr. Vaz: I give way to another member of the previous Government, who began the process of European defence.
    Mr. Howard: As the Minister is unable to call upon his solicitor's services this evening, will he answer the question that my hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith) asked?
    Mr. Vaz: Why should I need a solicitor when an eminent barrister such as the right hon. and learned Gentleman is present? He is probably even more expensive than any solicitor that I could have.
    The first annexe to the Nice report includes the conclusions of the capabilities commitment conference of 20 to 21 November 2000. At that conference, which was a UK-French initiative, EU nations set out the contributions that they proposed to offer the EU's headline goal.
    The headline goal of the European defence initiative is a step change in Europe's military performance. By 2003, EU nations operating; together should be able to deploy up to 60,000 troops it 60 days, and maintain a deployment of that size for at least a year. The capabilities conference showed that EU nations had enough troops to meet that target. The total contributions offered were more than 100,000. The quantity target was met. However, the conference agreed that further efforts were needed to improve the quality if the European performance in the availability. deployability, sustainability and use of those forces; in the ability to transport troops rapidly to the field of operations; and in better missiles, precision weapons and logistic support.

    141
    Britain welcomed that honest appraisal of the shortfalls and the commitment to filling those gaps. These high-readiness crisis management troops are precisely what NATO needs in the Balkans. This is, therefore, a practical example of how improving the performance of European nations also strengthens NATO.
    Mr. John Maples: The capabilities conference also called for the availability of 400 combat aircraft and 100 naval vessels. Why would the European Union rapid reaction force need all those troops, aircraft and ships just to perform Petersberg tasks?
    Mr. Vaz: Because it is important to show that there is the capability to achieve that. The hon. Gentleman should know that because he has a deeper knowledge of the subject than the right hon. Member for Horsham, and has thought carefully about it. Certainly, when I appeared before the Select Committee on Foreign Affairs, he probed me on that point. It is important that those capabilities exist.
    The capabilities conference was not just about EU nations. We deliberately made the headline goal a target that applied only to EU nations to ensure that the pressure was kept up to deliver real improvements without relying on others. However, the ESDP should involve all European nations, so the non-EU European members of NATO and other accession candidates offered contributions that would be available for EU-led operations.
    Nice also proposed a mechanism to ensure that EU nations' progress towards the headline goal was kept under review. That will involve close co-ordination between the EU and NATO, to ensure that commitments made in NATO defence planning and the ESDP are fully compatible.
    Dr. Nick Palmer: Does my hon. Friend the Minister agree that it is profoundly shocking that the Opposition appear willing to allow our ground troops to be exposed to risk without the support of the naval and air forces that they might need? Does he accept that 60,000 troops constitute one reinforced division, and that, on their own, they could be vulnerable?
    Mr. Vaz: My hon. Friend makes a good point. However, nothing that the Opposition do these days shocks me.
    The ESDP will work only as part of a transparent and effective relationship between the EU and NATO. A lot of nonsense has been talked about the EU establishing itself as a rival to NATO, and that nonsense comes from the hon. Member for Chingford and Woodford Green, who goes like a weasel to Washington to continue to poison the Administration there. That is emphatically not the case. The EU and NATO are not two anonymous, institutional monoliths. Eleven European countries are members of both. Both take defence decisions by consensus.
    I saw that consensus today when I attended the General Affairs Council meeting in Brussels. The Secretary-General of NATO and the Foreign Minister of Macedonia met the Foreign Ministers of the EU countries to discuss the situation in Macedonia. This is not a question of the EU and NATO acting separately. The way to deal with
    142
    European defence is for those organisations and institutions to work together. This is the only way that it can be achieved.
    Mr. John Gummer rose—
    Mr. Ian Bruce rose—
    Mr. Vaz: I give way to one of the pro-Europeans on the other side of the House: the right hon. Member for Suffolk, Coastal (Mr. Gummer).
    Mr. Gummer: Will the hon. Gentleman help the House further on this matter? He has made a number of comments but has not been able to answer the question that was in my mind and that of my hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith). The Minister prays in aid the Maastricht treaty—which I voted for—yet his leader voted against it and made it clear that the very things that the Minister now says are good about it were not good. What has changed in the meantime?
    Mr. Vaz: The right hon. Gentleman clearly has not been listening to what I have been saying. If he had been listening, he would know that the important part of the European defence framework that was established at Maastricht enabled us to continue this defence policy.
    I know that the right hon. Gentleman supported the Maastricht treaty, and I know that it was signed by the right hon. Member for Horsham; but other Conservative Members, such as the hon. Members for Stone (Mr. Cash) and for Buckingham (Mr. Bercow), would not have signed the treaty, and do not support it. At least their position remains one of integrity, and not one to be changed whenever certain situations arise.
    Mr. William Cash: The Minister made some carping remarks about my hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith) and his visit to Washington. Has the Minister read the House of Commons research department's note regarding the question of what President Bush has understood from the Prime Minister? It states:
    "Mr. Bush's seemingly relaxed view of ESDP may be somewhat misplaced. His reference to assurances from the Prime Minister that NATO and ESDP would have a joint command, and that the planning would take place within NATO, would appear to overstate the level of EU-NATO co-operation as laid down in the Presidency report from Nice."
    Mr. Vaz: I would rather hear the words used by President Bush himself than the comments contained in the document from which the hon. Gentleman has quoted. [Interruption.] What Opposition Members cannot stomach is the fact that the Prime Minister could go to Camp David and secure agreement with President Bush on this matter. That is what they cannot stomach, but that is exactly what happened. Support for the European defence policy from President Bush was the most important thing that came out of Camp David, and the hon. Gentleman knows it.
    Mr. Ian Bruce: The Minister will recall that France threw NATO out of Paris because it did not want command and control of its forces to be organised under

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    NATO. What does this agreement on European armed forces mean? Does it mean that France is returning its troops to the command and control of NATO, or does it mean that all our troops are being taken out of that command and control?
    Mr. Vaz: France is completely supportive of these proposals. It signed up to the Nice agreement, which followed a conference and a council convened by the French. I am surprised that the hon. Gentleman does not know that Nice is in France: that is where it was all agreed.
    The ESDP will work only as part of a transparent and effective relationship between the European Union and NATO. The Nice presidency report includes a comprehensive set of proposals for EU-NATO relations, which are listed in annexe VII of the report and its appendix. The EU makes three proposals. It proposes that co-operation should cover all questions of common interest relating to security, defence and crisis management; that there should be joint ministerial, senior official and military committee meetings during each EU presidency; that EU representatives attend NATO meetings, and vice versa; and that all those contacts should be intensified in a crisis.
    The arrangements do not seem to have satisfied some Opposition Members, but they were welcomed by NATO Foreign Ministers when they met during the week after Nice. The EU welcomed NATO's positive reaction. In an exchange of letters, the EU presidency and NATO's Secretary-General noted that there was now agreement on the elements of the permanent NATO-EU relationship. Copies of the exchange were placed in the Vote Office in advance of tonight's debate. I am sure that the hon. Member for Stone. a frequent visitor to the Vote Office, has already collected his copy.
    The other crucial aspect of NATO-EU relations is represented by arrangements for the EU to have access to the assets and expertise of the alliance. There is no intention to duplicate unnecessarily in the EU what exists already in NATO or in European nations. For any EU operation using NATO assets, the operational planning and command structures will come from NATO.
    Mr. John Redwood: In that case, can the Minister explain why the EU force—I think that it is an army—needs a military committee, a political committee to direct it, beefed-up strategic intelligence and extra transport? Is it not, in practice, a scheme for a comprehensive military force that does things that NATO does not want to do—not under NATO command and not in co-operation, but separate and deliberately so? Have not the Government lost to the French on that very issue?
    Mr. Vaz: I am really sorry that, after I have opened this debate and all the discussions that have taken place, the right hon. Gentleman simply does not understand what we have been talking about. As he heard me say right at the beginning, NATO remains the cornerstone of our defence policy. As he also heard me say, of course any
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    operation of that type will have to draw on NATO assets and NATO command structures. That is precisely what I have just said.
    Dr. Julian Lewis: Will the hon. Gentleman give way?
    Mr. Vaz: I shall give way in a moment. Let me make a little progress first.
    The EU military staff will not do operational level planning, nor will it provide command and control structures. It will be a small secretariat with officers on secondment from national Ministries of Defence. It will support the EU military committee and maintain close contact with NATO headquarters. There will be about 140 officers in the EU military staff. It is fanciful to think that that could rival or duplicate the work of the 2,000 or so officers at the Supreme Headquarters Allied Powers Europe, and nor would we want it to.
    For small EU-led operations, the alternative exists of planning done by national headquarters, such as the United Kingdom's permanent joint headquarters or the French equivalent. That might be appropriate, for example, for an evacuation of EU nationals or a straightforward humanitarian mission. Regardless, EU nations would decide on an operation only after consultation with NATO and once it was clear that NATO was not going to act. Does the right hon. Member for Wokingham (Mr. Redwood) understand that, or does he want me to repeat the sentence?
    Dr. Lewis: The Minister has rightly said that there will be no duplication of assets, which is absolutely true. If the EU rapid reaction force is operating, it will have to use assets previously allocated to NATO. Is it not correct that the EU rapid reaction force will be operating only on occasions when NATO does not wish to be involved? Therefore, is not the consequence that, when the EU rapid reaction force is operating on such occasions, it will be taking away forces from NATO, thus leaving NATO with fewer forces for those operations in which it does wish to be involved?
    Mr. Vaz: The hon Gentleman almost got it right. He was fine up to the last sentence, when he really lost it. Of course the force will draw on NATO assets, but it will do so because NATO remains the cornerstone of our defence policy. There will not be any operations other than those in which NATO has said that it will not act. The hon. Gentleman was fine until the last sentence.
    EU nations will determine the objectives for an EU operation and will be responsible for its strategic control and political direction. Some hon. Members seem surprised that a NATO command structure used for an EU—led operation should come under the EU' s control for the duration of the operation. However, that would seem to me to be a statement of the obvious. If the United Kingdom mounts a national operation, it is the United Kingdom that will decide. if NATO operates, NATO nations together take the decisions. If the EU undertakes a military operation, who should decide its strategy and direction but the EU nations themselves?
    The Nice report sets out, at annexe VI, how the EU will ensure the closest possible involvement of non—member states in the ESDP. That applies from

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    consultations in the routine phase, to their rights and obligations in the EU—led operation. During every presidency, there will be meetings with the non—EU European members of NATO and, separately, with those countries plus the other candidates for accession to the EU. That consultation will be intensified as a crisis emerges. At that point—indeed at any point—non—member states can call for additional meetings with EU countries.
    In recognition of the importance of NATO's place in the ESDP, European members of NATO outside the EU will have the right to take part in any EU operation using NATO assets. Other non—member states can be invited to do so. When non—member states are making a significant contribution to an EU—led operation, they will take part in its day—to—day management on the same basis as participating member states. That is precisely the kind of dialogue that we had today in Brussels when the NATO Secretary—General and the Macedonian Foreign Minister met EU Ministers to discuss the serious situation in Macedonia.
    Mr. Duncan Smith: The hon. Gentleman is guilty of playing games with words. The reality, as he knows very well, no matter how much sophistry he applies to it, is that the key phrases in annexe VII mean that what happens between the EU and NATO
    "must take place in full respect of the autonomy of EU decision—making"
    and that
    "the entire chain of command must remain under the political control and strategic direction of the EU throughout the operation"
    The Minister knows well that when those words were written, they did not intend, as the Prime Minister said to President Bush, that everything would be under the command of NATO, as he had promised.
    Mr. Vaz: The hon. Gentleman just cannot bear the thought that the United States of America and ourselves—President Bush and Prime Minister Blair—were able to agree on European defence on 23 February, because he has spent so much of his time trying to undermine the relationship between the two counties, with his weasel words in Washington. That is a disgraceful way to treat such matters. I realise that he is preparing for the inevitable leadership election after the general election; I am sure that the telephone banks are already set up. None the less, I assure him that we are very comfortable with the words of President Bush and the Prime Minister at Camp David. That is what the hon. Gentleman cannot get over.
    At Nice, there was agreement on the roles and composition of the permanent political and military structures within the EU for crisis management. For the convenience of Conservative Members, I can tell them that those are set out in annexes III to V. The General Affairs Council on 22 January decided how they would be established.
    The Political and Security Committee has replaced the EU Political Committee. It is responsible for day—to—day management of all CFSP issues. It will be the main interlocutor of the North Atlantic Council. The PSC and NAC met for the first time on 5 February. As well as taking forward the ESDP, they are concentrating on the practical issues of NATO—EU co—operation in the Balkans.
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    The military committee brings together national Chiefs of Defence Staff or their representatives. It will be the interlocutor of the NATO military committee. Most nations, including the United Kingdom, appoint the same military representatives to NATO and the EU, to ensure a coherent approach.
    The discipline and coherence of the EU and NATO military committees will be a useful preparation for the new responsibilities of the current UK military representative, Sir Michael Willcocks; as hon. Members may be aware, he has just been appointed to succeed Black Rod.
    The military committee will be formally established once its first permanent chairman is appointed, later this spring. The military staff will also be formally established later this spring, following a decision by Javier Solana, the High Representative.
    Mr. Jonathan Sayeed: Will the Minister give way?
    Mr. Vaz: I have given way several times in this debate, and I shall not give way to the hon. Gentleman now. He can take part in the debate. I am well aware that only an hour and a half has been allocated for it, and I shall not therefore cover the provisions in the Nice report for taking forward the civilian aspects of crisis management and work on conflict prevention. Both of those are important, as the Balkans crises show, and the EU work on them under the Swedish presidency is proceeding well.
    Let me, in closing, re—state the fundamental points for the benefit of the right hon. Member for Wokingham. The ESDP is good news for Britain, Europe and NATO. That is why the Government developed it, why Europe supports it and why the United States and NATO have welcomed it in the statement made by President Bush and the Prime Minister on 23 February. This Government, the United States Government, our EU partners and NATO allies are engaged in making a success of the ESDP. Nice was an important step towards realising the goals of a NATO—friendly ESDP. It was a good result for NATO and a good result for Britain.
    11.40 pm
    Mr. Quentin Davies: It sets a new record for brazenness in this place for the Minister of State, in the circumstances in which he finds himself, to talk about integrity and hypocrisy. No wonder not a single member of the Cabinet had the face to come here tonight to support him, including his boss.
    This is a very important matter. We all congratulate the Select Committee on European Scrutiny for having brought it to the attention of the House. I hope that, at least for the rest of the evening, it will get the attention that it deserves.
    Let me start by saying clearly and unambiguously, so that there can be no doubt at all, that Conservative Members are completely in favour of enhancing the defence capability of the European members of the Atlantic alliance. We are completely in favour of enhancing the European pillar of that alliance, so long as that is done in such a way as to reinforce the alliance as a whole. That means taking with us all the members of the alliance in Europe, EU and non—EU, and, of course, Canada and the United States.

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    It is perfectly true that the previous Conservative Administration played a very positive and proud role in the 1994 Washington—I mean NATO—summit, which agreed on the concept of a European strategic defence identity within NATO and on deploying a joint taskforce. However, we did that in such a way as to reinforce NATO, to ensure that all the allies were behind the decision and to enhance the links between us and the United States.
    Mr. Vaz: The hon. Gentleman seeks to claim credit for the Washington summit. Of course, the Washington summit took place in 1999, when this Government were in power.
    Mr. Davies: The hon. Gentleman has not been paying attention. I was talking about the decision at the 1994 NATO summit to create a European strategic defence identity within NATO. [HON. MEMBERS: "It is not in the brief."j As it is not in the brief, perhaps he does not know about it.
    The hon. Gentleman has quoted at length the communiqué that resulted from the Camp David meeting between the United Kingdom and President Bush. I have the transcript before me. It raises a number of questions to which the House is entitled to straightforward answers—a good deal more straightforward than the hon. Gentleman is accustomed to giving in other contexts. He certainly will not have the opportunity, as he had with the Parliamentary Commissioner for Standards, simply to say that he would not answer—
    Mr. Deputy Speaker: Order. We are here to discuss the motion before the House. I remind hon. Members that that is all we are here to debate.
    Mr. Davies: Let me quote what President Bush said after the meeting at Camp David. He said of the Prime Minister:
    "he also assured me that the European defense would no way undermine NATO. He also assured me that there would be a joint command, that planning would take place within NATO … And finally, I was very hopeful when we discussed the Prime Minister's vision that such a vision would encourage our NATO allies and friends to bolster their defense budgets".
    So the Prime Minister evidently gave three assurances to President Bush, and he was sitting next to him when President Bush used the words that I have just quoted. He gave an assurance on joint command, an assurance that planning would take place within NATO and an assurance about increases in the budget.
    So far as bolstering the defence budget is concerned, there has clearly been no response at all to the Camp David meeting. The Government allowed the defence budget to fall steadily in real terms during their first three years, and the present Budget provides for a 0.1 per cent. increase in real terms in defence spending. The continentals mostly have defence budgets that are stable or falling, and our German allies are in the middle of a steady four—year reduction in nominal terms, which is even bigger in real terms.
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    I turn now to the key questions of the joint command. Again, I quote President Bush. He said that
    "there would be a joint command."
    How does that square with the text of the Nice treaty? How does it square with the explanatory memorandum that the Minister of State sent to the European Scrutiny Committee? Annexe 7 to the Nice treaty does not refer to joint commands. It clearly says that the European Council
    "will appoint the operation commander and, through the intermediary of the PSC"—
    that is the EU Political and Security Committee—
    "instruct him to activate the chain of command."
    The treaty goes on to say that
    "the entire chain of command must remain under the political control and strategic direction of the EU throughout the operation … In that framework the operation commander will report on the conduct of the operation to EU bodies only."
    How can that possibly describe a joint command? There is absolutely no reference to a joint command and no description of how it might even come about or what it would look like. It would indeed be a rather unusual animal.
    Among other things, the treaty says that there will be
    "full respect of the autonomy of EU decision—making",
    which also seems to be inconsistent with any idea of a joint command. I will give way to the Minister of State if he wants to explain that to the House. How does the assurance given to President Bush at Camp David—which he accepted in good faith, as is clear from the text of his statement to the press afterwards—square with the text that I have just read out? The hon. Gentleman's silence is eloquent.
    I turn now to planning. You will recall, Mr. Deputy Speaker, that President Bush said that he had received assurances
    "that planning would take place within NATO".
    There is no reference to any other possibility in his statement or, presumably, in the understanding that he was given of the matter. Annexe 6 to the Nice treaty sets out two possibilities on planning which I shall deal with in turn. It says:
    "For operations requiring recourse to NATO assets and capabilities, operational planning will be carried out by the Alliance's planning bodies, and for an autonomous EU operation it will be carried out within one of the European strategic level headquarters."
    There is no reference to that whatsoever in the Camp David communiqué or the statements made to the press by the Prime Minister and the President after that meeting. Was that matter raised? Was that possibility discussed with the President? Did the Minister of State and his colleagues think that President Bush or his advisers somehow would not get round to reading annexe 6? Does the hon. Gentleman. in the course of his duties in the Foreign Office, regularly underestimate the intelligence of the foreigners with whom he is dealing?
    Mr. Bill Rammell: I want fully to understand the hon. Gentleman's position. Is he saying that President Bush and his advisers did not read the Nice treaty, were not properly briefed on it and were therefore duped and misled by the Prime Minister? Is not that a strange attitude for the Conservative party to strike against a Republican President?
    Mr. Davies: The hon. Gentleman is sadly all too right, which is why the matter is so serious. He should know

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    that for some generations this country's Prime Minister, from whichever political party he comes, has enjoyed a great deal of credibility in Washington. When the Prime Minister went to Camp David, there is no doubt at all that President Bush would not have taken account of the possibility that the Prime Minister would conduct their conversations on the basis of concealing material facts. It is hardly surprising that President Bush's advisers have been extremely concerned since the Camp David meeting that they may indeed have been misled. My hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith), the shadow Secretary of State for Defence, has often drawn attention to that.
    Let us examine the discrepancy between the text of the treaty of Nice and what was said to President Bush. I shall take the two possibilities in the treaty in turn: one is that planning for an EU operation would lie with one of the European strategic level headquarters; the other is that the operational planning structure of the alliance would be involved if NATO assets were involved.
    Mr. Vaz rose—
    Mr. Davies: I shall give way. Perhaps the Minister will answer one of my questions.
    Mr. Vaz: The hon. Gentleman should calm himself a little. He needs to know that he is insulting the intelligence of the Government of America, which is one of our strongest allies. He ought to know that, before the Nice Council, the draft of the treaty and the annexes were sent to the Americans, who read them very clearly. After the Nice Council, NATO Foreign Ministers—that includes the United States of America—welcomed the Nice conclusions. He is insulting the intelligence of the American Administration and he should apologise for doing so.
    Mr. Davies: It is quite apparent that the Prime Minister gave assurances to President Bush at Camp David because those assurances are in President Bush's statement, which I have already quoted. It is quite clear that the understanding given to President Bush is that which President Bush himself expressed. I have just quoted it.
    Mr. Vaz: Will the hon. Gentleman give way?
    Mr. Davies: In a moment. I must tell the Minister something else. He said that the Conservative party had somehow succeeded in poisoning the mind of the American Administration, but he again underestimates the intelligence of the people he is dealing with. It would be quite impossible to poison the mind of the American Administration with disinformation, but it is possible to make it clear to them that the Government speak with forked tongue. Indeed, individuals members of the Government may speak with forked tongue.
    For all that the Minister does not want me to, I shall examine in detail the two possibilities for operational planning. Let us take the example of operational planning in one of the European strategic level headquarters. Here is a question that he may answer: what will happen to the permanent joint headquarters? Will it be turned into an EU headquarters for operational planning purposes? Will all the various sections of PJHQ such as J1, administration; J2, intelligence; J3, operations; and J5
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    planning, be full of staff officers from 14 other EU countries? Does he envisage PJHQ being turned into a combined EU headquarters? Does he seriously think that that is feasible? Does he seriously think that in those circumstances PJHQ could continue to carry out its task of managing our national operations in the Falklands and Cyprus, our deployments in Kosovo and Bosnia and major exercises? The hon. Gentleman shakes his head; he realises that it is not a viable possibility. What exactly does he mean by the words
    "within one of the European strategic level headquarters"?
    Does he want me to give way to him? I will do so. Will he tell us what that phrase means? Should I count up to 10 to see whether he will respond?
    Mr. Vaz: I do not want to be rude to a fellow former ex—Caian, but I should be very surprised if the hon. Gentleman could count up to 10, bearing in mind that he has understood nothing that has been said this evening. He knows that the operation and planning of all these matters starts with NATO. As he knows—it is a pity that his speech does not reflect it—we are talking about a limited set of tasks: the Petersberg tasks. They were agreed at the Petersberg hotel by Sir Malcolm Rifkind and Lord Hurd and they deal with those issues. That is what we are talking about. For all the substantial issues on European defence, we will have to draw on the assets and planning capabilities of NATO. That is why President Bush is so comfortable with the arrangements and supports them. That is why the hon. Gentleman cannot believe that the policy has the support of the Americans.
    Mr. Davies: The hon. Gentleman makes my point. I ask him to elucidate, for the benefit of the House, an important phrase in the document:
    "within one of the European strategic level headquarters".
    I offer to give way to him; I force him—more or less—to stand up but he does not answer the question at all. He does not deal with my question; he simply comes out with a childish insult against me, and then a lot of irrelevant obfuscations in the best new Labour mode.
    The Minister makes my point. It is clearly established that the Government either do not know what the phrase means or that they are certainly not going to tell anyone else what it means. On such important matters of national security, it is extremely worrying that we should be dealing with our major ally—the United States—on that basis. If the Minister who is responsible—who signs the memorandum that we are discussing—does not know the answer to my question, how can he possibly deal with operational planning?
    Mr. Redwood: Is my hon. Friend aware that, after the meeting between the President and the Prime Minister, Defence Secretary Rumsfeld and an Under—Secretary who is about to join the State Department made interesting statements? Those statements make it clear that the American Administration have studied the annexes and texts and are worried on exactly the grounds set out by my hon. Friend and by my hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith). The American Administration are pleased that I, my hon.

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    Friends and others are going to the United States to tell them the truth about these matters because they are clearly not getting it from the Government.
    Mr. Davies: Anybody who was mildly worried before this evening would be absolutely terrified after the Minister's performance, because he does not even know—or will not say—what is meant by those words.
    Let us consider the other side of operational planning. That requires recourse to NATO operational assets because such assets would be used in the potential operation. The treaty makes it clear that the alliance planning bodies would be involved. That raises yet again an issue that the Government have systematically attempted to conceal from Parliament and from the public. The Minister did not even refer to it in his remarks. I will give way to him if he is willing to answer my question. Is it not true that the Turks have exercised a veto? Is it not true that the Turks have said that they do not accept the concept of guaranteed permanent access by the EU to NATO assets—either physical assets or operational planning assets? Is that not the case? Perhaps the hon. Gentleman would like to answer the question. Again, I will give way to him.
    Mr. Vaz: That is not the case. Turkey, as a NATO ally and a friend of the United Kingdom, has raised concerns in the same way that everyone else involved in the issue wishes to have a dialogue to ensure that we get it right. That is the right approach. We can work with allies, such as Turkey and other countries, so that, in the end, we have a joined—up policy on European defence, working with the European Commission, the Council of Ministers and NATO. That is the way in which such things are done, and it is the right approach when dealing with such crisis management situations.
    Mr. Davies: All of us who are concerned about the diplomacy of our country must be shaking in our boots having heard that extraordinary response.
    The Minister says that Turkey has expressed concerns. That is another piece of disingenuous new Labour drivel. The Turks have actually said no. They have said that they will not agree to the proposal for permanent guaranteed access; they want to have a veto on each occasion. The treaty defines permanent guaranteed access as not requiring the approval of other NATO members on each occasion; nor, indeed, could the arrangements work if it were possible for a member of NATO, not a member of the EU, to exercise a veto on any occasion when NATO assets were required, or when the EU wanted access to NATO operational planning assets. So the second half of the arrangements for operational planning do not work either.
    The Minister did not know what the first half of the arrangements involved; he could not describe or explain them. He has now had to concede that the second half cannot work because the Turks have vetoed it, and the Turks are fully entitled to do so. It is extraordinary that
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    the major issue—that involving the Turks—has been systematically concealed from the public debate by the Government.
    Mr. John Wilkinson: Will my hon. Friend give way?
    Mr. Davies: I shall give way once again, but then I shall make progress because I want other hon. Members to have a chance to speak.
    Mr. Wilkinson: It is not just the Turks who are deeply worried, but the American military as well. Is not that the most significant point of all? If the EU were to draw down American NATO assets—for example, if transport aircraft were required to fly lo a war zone under EU command—the United States Congress and the American people would not stand for it.
    Mr. Davies: Of course the Americans are worried about that. Naturally they are also worried about an EU force getting into trouble and requiring the Americans to come to its aid. The Americans are troubled about many things, but we should all be troubled not only by the issues that have been raised, but by the fact that the major dimension to the matter—the Turkish veto—has not been mentioned by the Government. I have had to drag it out of the Government this evening from the Dispatch Box.
    Once again, all those issues raise a dual problem: are the Government utterly incompetent, or are they duplicitous—or are they a rather nasty mixture of both? Let us consider the Turks. Did the Government know that the Turks would not agree to the arrangement? If they did not, did they speak to the Turks? How many times has the Minister gone to Ankara to discuss the matter with the Turks? He stopped answering questions from the Parliamentary Commissioner for Standards at the beginning of December, so he has had plenty of time since to go to Ankara if he had wanted to do so.
    Madam Deputy Speaker (Mrs. Sylvia Heal): Order. I remind the hon. Gentleman of the limits of this debate.
    Mr. Davies: I was simply explaining the possible chronological constraints, which might have disbarred the Minister from performing his functions, that existed until recently.
    This matter simply will not go away. I have to tell the Minister that he and the rest of the Government have been steadily stonewalling. If they had come clean at the beginning, they might have had greater credibility in the House, in the alliance and in the United States. The fact is that many of us knew that a Labour Government could never really be trusted with defence. Many of us knew that their commitment to our alliances was so superficial, so recent and so opportunistic that it could not be trusted. A lot of us suspected that, when allied to the irresponsible, cynical, spin—doctoring culture, of which this particular Minister, with his reputation for shiftiness, is such a poor example—
    Madam Deputy Speaker: Order. Will the hon. Gentleman please withdraw that remark?
    Mr. Davies: I withdraw that remark, Madam Deputy Speaker. Would it be possible to say prevarication or

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    circumvention? Would they be acceptable parliamentary terms? They describe the nature of the leadership that we have had on this question. That is why the document does not stand up, why we have promises about operational planning that do not make sense and why we have promises about NATO command that are contradicted in the text of the document. That is why there is a crisis of confidence between the United States, the new Labour Government and the European allies
    If the Government continue in office for more than a few moments more, if they continue to believe that they can speak with two voices, say one thing in Europe and another in Washington and conceal from the House of Commons and the British public the truth of what is going on, they will have another think rapidly coming.
    12.6 am
    Mr. Paul Keetch: This has been a lively debate, but I shall keep my remarks brief so that other hon. Members might have a chance to speak. [Interruption.] I note, however, that Conservatives Members are eagerly leaving the Chamber, so it is clear that they have no further contribution to make to this important debate.
    Liberal Democrats believe that NATO is and will remain the bedrock of the United Kingdom's defence. It is Britain's ultimate insurance policy It ensured British security through the cold war and encouraged defence co—operation and planning after the fall of the Berlin wall.
    We have also understood and believed in the need for an improved European dimension. When Colin Powell, the US Secretary of State, told NATO members on 27 February:
    "The United States supports and welcomes the creation of a European Defence facility",
    the loudest sound in London was the gnashing of teeth at Conservative central office. Despite the myths that we have heard from Tory central office and the myths that we have heard tonight, the United States supports totally the approach that the Government have taken.
    Let us make no bones about it. The European Union's initiative allows for the autonomous political direction of operations by EU member states in the Council—not the Commission or the European Parliament—but for operational and strategic planning tot remain entrenched in NATO. As my right hon. and learned Friend the Member for North—East Fife (Mr. Campbell) and I have said on previous occasions, we believe that there should be a NATO first refusal. In an article in The House Magazine on 8 January, I wrote:
    "Liberal Democrats have argued that NATO should always have the right of first refusal before any action is taken … It is understood that this will be normal operating practice but if that requirement were inserted in the arrangements, it could never be said that NATO had been sidelined or undermined."
    The draft presidency report on European security and defence policy makes it clear that the Deputy Supreme Allied Commander Europe will be the "strategic coordinator" and that
    "operational planning will be carried out by the Alliance planning bodies".
    The NATO Washington summit supported that and all alliance partners agreed. They said:
    "We stand ready to define and adopt the necessary arrangements for ready access by the European Union to the collective assets and capabilities where the Alliance as a whole is not engaged."
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    EU member states have made proposals and
    "hope for a favourable response from NATO",
    but there is some confusion about when and in what circumstances the EU will be asked to act.
    Mr. Blunt: Will the hon. Gentleman help the House by telling us whether the Joint Committee of the Liberal Democrats and the Government is still going, or has it been betrayed by the Government's double—speak in the way that the Americans and the Europeans have been by the Prime Minister?
    Mr. Keetch: That question has nothing to do with the debate, so I shall continue with what I was saying.
    There is some confusion. It is clear that only the most minor of missions will be able to be undertaken without NATO assets and that activities are to be confined to the Petersberg tasks of peacekeeping, humanitarian intervention and crisis management. In all cases, the decision to deploy will remain a matter for sovereign Parliaments. As with NATO, Government and Parliament will ultimately make the decisions, but the phraseology
    "where NATO as a whole is not engaged"
    is open to interpretation. The new Bush Administration made it clear that they support the CESDP.
    Mr. Redwood: Will the hon. Gentleman give way?
    Mr. Keetch: No. The right hon. Gentleman has spent too long on his feet tonight.
    The Bush Administration also made it clear that Britain's assurances on the primacy of NATO need to be made more formal. Condoleezza Rice, the United States national security adviser, said that the US has been assured that European Union nations
    "consider NATO to be the principal security instrument in Europe, that there is in fact a kind of NATO right of first refusal for missions."
    The Defence Secretary, Donald Rumsfeld, pointed out that the devil will be in the detail. We agree. Liberal Democrats have always believed that NATO should have the right of first refusal.
    It has been claimed that the European rapid reaction force constitutes an alternative to NATO. That is nonsense. Collective defence in which an attack on one is an attack on all remains the primary responsibility of NATO. The ERRF is a capability at the disposal of either NATO when it chooses to act or the EU when NATO chooses not to engage. In either case, NATO planning and command structures should remain in place without any wasteful duplication.
    Several hon. Members rose—
    Mr. Keetch: No, I will not give way.
    Liberal Democrats have argued that NATO should have the right of first refusal. It is understood that that will be normal operating practice, but if that requirement is inserted in the arrangements, as we believe it should be, NATO could not be sidelined or undermined.
    The ERRF is not conceived as a standing European army. At no time will national security be suspended or national control over the use of armed forces be removed. It is, and will remain, up to the nation state to decide if and when our troops are deployed.

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    We believe that a successful ERRF will be a success for Britain in Europe. If the force is modelled on the image that Britain desires and its embryonic mechanisms complement NATO instead of competing with it, that will be impressive and it should receive our support. By maintaining a firm commitment to European defence, we can ensure that the ERRF lives up to expectations and that the European contribution to peace and security in the 21st century is enhanced.
    12.12 am
    Sir Raymond Whitney: My hon. Friend the Member for Grantham and Stamford (Mr. Davies) rightly draws attention to the declining defence budgets of EU Governments in recent years, which is the first issue at the root of the problem. I am sorry to introduce a note of sombre common sense into what has been a fairly jolly party—indignant though we are about some of the issues that have emerged—but western Europe has not been pulling its weight in defence, which has created significant worries about the commitment of the United States to NATO.
    The second fundamental issue must not be swept away in a wave of anti—Europeanism. We must not have the Pavlovian reaction that everything that comes out of Europe is wrong or inimical to British interests. We must consider the issues calmly and carefully because nothing is more important than defence. The essential requirement that western Europe strengthens its defence capability must be common ground to every right hon. and hon. Member.
    As Donald Rumsfeld, the American Defence Secretary, said to our former hon. Friend and colleague Winston Churchill in an interview in The Sunday Telegraph yesterday, the outcome of the CESDP must add to NATO capabilities, not detract from them. That is another given in this complex and important issue.
    The third fundamental is that we must be clear about the French agenda, which, to put it at its mildest, might not be the same as the British agenda; moreover, it is not the same as that of most European members of NATO. We arrogate to ourselves the defence of NATO, as though no other member of NATO cares a tuppeny damn for it, but we know that that is wrong—try telling the Germans that only we, the British, know the value of NATO: my goodness, living under the threat of Russia, and formerly the Soviet Union, the Germans have every military, strategic and geographical reason to know the value of NATO.
    It is important that in constructing the ESDP nothing is done that threatens the viability and effectiveness of NATO and the American commitment to it. That is a difficult line to follow—a difficult case to make. However, the interview with Donald Rumsfeld, whom I had the privilege of knowing many years ago, shows that he and, I believe, the entire American Administration are fully aware of the dangers. They have not rejected the ESDP outright, because they know that good things might come from it, but they also know that care must be taken.
    Mr. Mark Hendrick: Does not the hon. Gentleman think it strange that Front Benchers of his own party trumpet a possible Turkish veto of any such
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    arrangement when, despite Mr. Rumsfeld's comments, they cannot find sufficient evidence for an American veto of such operations?
    Sir Raymond Whitney: It is important to examine Mr. Rumsfeld's comments and I am sure that my right hon. and hon. Friends on the Conservative Front Bench are doing precisely that.
    When challenged by Mr. Winston Churchill—whose approach to these issues is, I imagine, not dissimilar to that of my hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith); I might be doing one or both of them an injustice, but I doubt it—Mr. Rumsfeld said that President Bush's attitude was "relaxed" and that he was aware of the details agreed at Nice. I do not necessarily accept statements made by the Minister of State, Foreign and Commonwealth Office, but I certainly accept the statement of my friend Donald Rumsfeld.
    I believe that we must consider Mr. Rumsfeld's statements. We should carefully examine the details that worry him—they should worry us as well, but they might not present insoluble problems. Now is not the time to go into the chains of command and logistics—
    Mr. Cash: Why not?
    Sir Raymond Whitney: Because we do not have time. They are important mtatters, but they cannot be debated at half—past midnight with 10 minutes to go until the debate ends.
    Mr. Gerald Howarth: I take my hon. Friend's point about the hour being late and our not being able to go into much detail, but Donald Rumsfeld said
    "the devil is in the detail ".
    That is precisely what causes the Americans' concern—their fear that they have been deceived by the Government.
    Sir Raymond Whitney: My hon. Friend leaps a pace too far. I am the first to concede that the devil is in the detail, and when Rumsfeld says that, he is right, but to suggest that poor old Rumsfeld and poor old President Bush do not know what is going on is wholly unjustified.
    I hope that we can all calm down and pretend that, just occasionally, some good things can come out of Europe. If we can make the ESDP work, it will be better for everyone, including the United Kingdom.
    12.19 am
    Mr. Michael Howard: In his first intervention during the Minister's rather disgraceful speech, my hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith) was entirely right to point to the Prime Minister's statement after the Amsterdam European Council in June 1997. The Prime Minister told the House:
    "getting Europe's voice heard more clearly in the world will not be achieved through merging the European Union and the Western European Union or developing an unrealistic common defence policy. We therefore resisted unacceptable proposals from others."—[Official Report, 18 June 1997:Vol. 296, c. 317.]

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    In the many exchanges across the Floor of the House since the St. Malo agreement in 1998, there has never been even the semblance of an explanation from the Government of why they have performed such a complete volte—face and U—turn on the position that they rightly took up, with Conservative support, after the Amsterdam Council.
    We cling to what the Prime Minister said; he was right then. The Government, the Minister and, indeed, the Prime Minister himself now think that he was wrong, but they have never explained why. My hon. Friend the Member for Grantham and Stamford (Mr. Davies) hit the nail on the head and got to the essence of the matter that we are discussing when he said that the Prime Minister spoke with a forked tongue when he went to Washington. The Prime Minister signed up to an agreement with our European partners at Nice, and then went to Washington and told the President of the United States that he had done something quite different. I do not think that the President was deceived for one moment; he knew exactly what was happening and set out for the world what he had been told by the Prime Minister It was then for the world to make a comparison. The President knew exactly what would happen; he knew that the world could compare what the Prime Minister told him with the language of the Nice treaty and its appendices—[Interruption.] What the Prime Minister told the President is therefore important; those assurances are significant.
    The President said of the Prime Minister:
    "He also assured me that there would be a joint command, that planning would take place within NATO, and that should all NATO not wish to go on a mission, that they would then serve as a catalyst for the defence forces moving on their own "
    My hon. Friend the Member for Stone (Mr. Cash) referred to the deliciously ironic language of the note provided by the Library on the President's words. It states:
    "Mr Bush's seemingly relaxed view of ESDP may be somewhat misplaced. His reference to assurances from the Prime Minister that NATO and the ESDP would have a joint command and that planning would take place within NATO, would appear to overstate the level of EU—NATO co—operation as laid down in the Presidency Report from Nice."
    The note goes on to quote annexe VII to the presidency report. I do not know which document the hon. Member for Rotherham (Mr. MacShane), Parliamentary Private Secretary to the Minister of State, Foreign and Commonwealth Office, was waving around a moment ago; I hope that it was annexe VII. It states that
    "the entire chain of command must remain under the political control and strategic direction of the EU throughout the operation, after consultation between the two organisations. In that framework the operation commander will report on the conduct of the operation to EU bodies only. NATO will be informed of developments in the situation by the appropriate bodies, in particular the PSC and the Chairman of the Military Committee."
    The Prime Minister was very fond of using the language—he used it when he came back from Nice. He said that these things will arise only when NATO chooses not to be involved. However, one will search the documents in vain for any reference to NATO's choice. It is not NATO that has the choice; under these arrangements, it is the European Union that has the choice.
    We heard from the hon. Member for Hereford (Mr. Keetch), who said that it would be a jolly good idea if NATO had the choice, and that it should be written into the agreement that NATO had the choice. I do not know what happened in the negotiations at Nice, but it is fair to
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    assume that the Prime Minister tried extremely hard to get language written into the agreement to make sure that NATO had the choice. If he did, he failed. That is not what the French wanted, or what the other Europeans wanted. The Prime Minister lost out in that negotiation, so the treaty says absolutely nothing about NATO's choice. It is the European Union that has the choice.
    Mr. Hendrick: Does the right hon. and learned Gentleman agree that the fact that the EU may consult NATO effectively gives NATO the choice of being involved or not?
    Mr. Howard: I have a good deal of respect for the hon. Gentleman, and I cannot believe that he means what he has just said. That is a ludicrous proposition. The European Union has the choice. It then consults NATO, but the EU can refuse to agree with what NATO says. It can consult NATO and reject what NATO says.
    If, indeed, there is to be a joint command, and if the planning structure, as the Prime Minister assured the President, is to be within NATO, why on earth is a Political and Security Committee needed? Why is a military committee needed? Why is a military staff needed outside NATO, as my right hon. Friend the Member for Wokingham (Mr. Redwood) pointed out? Why are all those bodies needed outside NATO?
    I agree with my hon. Friend the Member for Wycombe (Sir R. Whitney)—European defence co—operation needs to be strengthened. That is right, but it could and should be strengthened within NATO. All the command structures could be established within NATO, and none of the problems would arise.
    Mr. Redwood: I am grateful to my right hon. and learned Friend. Did he notice in the Minister's statement and elsewhere in briefings by representatives of the Government that they have conceded the point and moved on? They accept that the words of the treaty and the annexe set out an entirely new and distinct EU structure, but they are now telling the American allies and others not to worry, because significant sums will not be spent on strategic and intelligence command and control, so that will never amount to much. That is a different and rather lame kind of defence.
    Mr. Howard: My right hon. Friend makes an important point, with which I entirely agree.
    The arrangements can be tested in another way. The House of Commons Select Committee on Defence reported on these matters. The Committee suggested that it was important that DSACEUR, the Deputy Supreme Allied Commander Europe,.should have the right—the right—to attend all meetings of the European military committee. Comparing that report with what appears in the arrangements set out in the treaty of Nice, the House of Commons Library points out that the level of involvement of DSACEUR with EU bodies appears to fall short of the recommendation made by the Defence Committee in its report.
    That is absolutely right. DSACEUR's level of involvement certainly does fall short. The treaty provides that DSACEUR may be invited to meetings of the military committee when that committee considers it appropriate, but he has no such right to attend, as was recommended by the Select Committee

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    The United States Defence Secretary was right when he said that the arrangements put at risk something special. It is something that the Government should have held special. By putting it at risk, they have rendered one of the greatest of all the many disservices that they have rendered to this country.
    12.29 am
    Mr. Terry Davis: The appropriate response to the first point made by the right hon. and learned Member for Folkestone and Hythe (Mr. Howard) is that the proposals simply do not transfer the whole of the Western European Union into the European Union. The WEU has a range of responsibilities, including the Petersberg tasks, which are being transferred to the EU. However, it has other responsibilities—I refer especially to article 5 of the Brussels treaty—which are rightly not being transferred. I do not think that any party wants collective defence to be undertaken by the EU. Thus, the right hon. and learned Gentleman's first point, on which he built the rest of his speech, is frankly bogus.
    I was delighted to hear the speech made by the hon. Member for Wycombe (Sir R. Whitney), who introduced a more sober tone into the Opposition's approach to the debate. He was absolutely correct to say that this country is not alone in defending NATO. There are other EU countries that also attach greater importance to NATO than to the EU. As I said, it is not collective defence that is being transferred to the EU, but the Petersberg tasks, which relate to humanitarian missions, of which there have been several; indeed, there have been far too many in the recent history of Europe. In future, that responsibility is to be undertaken by the EU.
    Dr. Julian Lewis: If a Petersberg task is being undertaken, forces will be siphoned off from those previously allocated to NATO in order to discharge it. How can NATO discharge the tasks that remain within its remit if it has depleted forces? Is the right hon. Gentleman suggesting instead that European countries will spend more money and use larger defence budgets to add to the strength of their armed forces? If so, will he tell us which countries will do so?
    Mr. Davis: The hon. Gentleman makes a valid point. I recognise the importance of his comments and accept that forces cannot be used twice in two separate theatres. To pretend otherwise would be ridiculous and deceitful, so I entirely accept his point. However, the new arrangements do not change that situation. NATO can have more than one crisis to deal with. [Interruption.] I should like to finish my point; the hon. Gentleman asked a fair question and I am trying to provide a direct answer. The arrangements do not change the reality. Previously, if two crises occurred at the same time, NATO would have had to choose which one to prioritise. If two crises occur at the same time under the new arrangements, NATO will still have to decide whether to give priority to a crisis that is not being dealt with by the EU or whether to allow some forces to continue to be used by the EU.
    Let me give the hon. Gentleman a case in point, as such circumstances are not unprecedented. Four years ago, the need arose for Operation Alba. The United Kingdom did
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    not participate in the operation, but several of our NATO allies and some non—NATO European countries did so. If a bigger crisis had arisen that required those forces, the Italians, French and others taking part would have given priority to NATO. [Interruption.] I shall deal with the hon. Gentleman's second point in a moment. I have tried to answer his first question, as he did not receive a reply the first time he asked it.
    The hon. Gentle man's second question was about which countries would increase defence expenditure. That is another fair question, of which I am not afraid. Let me give him one good example. I have no doubt that Italy needs to increase its defence expenditure considerably. Currently, it does not define such expenditure in the same way as other NATO members. By NATO's assessment, it does not make a reasonable contribution to the collective defence of Europe and to NATO. There are other examples. but that is one of the most glaring. It does not help the debate to refuse to deal with such points.
    I should like now to continue with my main remarks, as I wish to put an important point to the Minister. Many of my hon. Friends and I support the Government's actions to enable the EU to make decisions to deal with the Petersberg tasks and to have the capacity and means of implementing the policy. However, many of us are worried about a defect that the documents do not mention. For several other defence organisations, not least NATO, we have had to create an assembly of parliamentarians to scrutinise common policies, assets, activities and purpose. Members of nations I Parliaments meet for that purpose, as they do in the Western European Union Assembly. A defect in the arrangements that we are considering is the lack of provision for scrutiny of common activities that are undertaken by the European Union on defence. I am talking not about accountability but about scrutiny.
    I regret that our Government have not succeeded in persuading our partners in the EU to implement some of the ideas that the Prime Minister and my hon. Friend the Minister have proposed for establishing an assembly, which will bring national parliamentarians together to scrutinise, exchange information and liaise. I appreciate that our Ministers cannot create such an assembly on their own, but I hope that they will continue to insist that a democratic organisation should have a democratic assembly that brings together the parliamentarians of all the countries involved. 1 hope that all hon. Members will support that.
    12.36 am
    Mr. William Cash: The European security and defence policy is a sort of satire, reminiscent of "Gulliver's Travels" and the tales of Baron von Munchhausen. It is a myth; a voyage in time and space, which is completely at variance with judgment, experience and reality. It is doomed to failure, and is yet another example of lions—in this case, the United States and the United Kingdom—being led by donkeys. As Wellington said of his allies in the Peninsular war:
    "I do not know what effect these men will have upon the enemy, but, by God, they frighten me."
    As Churchill and the British discovered with the Maginot line, such arrangements are all spin and no delivery.
    The fault lies with the Prime Minister and the Foreign Secretary. I have raised the point with the Prime Minister over Feira, and with the Foreign Secretary and the

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    Secretary of State for Defence whenever they have returned from summits. I have challenged them on every proposition about the autonomy of a European defence policy, its structure and the arrangement that assumes that they will be in the driving seat. On no occasion have they been able to reply with confidence.
    The Minister has been parachuted into the job with no prospect of reaching the ground without an unpleasant jolt.
    Dr. Julian Lewis: That is because they packed his parachute.
    Mr. Cash: Indeed. The Prime Minister, in his Euro—enthusiasm—I would say Euro—fanaticism—traded his failure to convince the British people about the single currency for something else that he wanted to pull out of the bag. He knew that we did not have an opt—out on defence, and he thought that he would be able to take the initiative on defence policy and claim that he was leading Britain in Europe. That is what St. Malo, Cologne, Feira and Nice were all about. However, the right hon. Gentleman has got into an appalling quagmire, as has already been revealed.
    I beg to differ with my hon. Friend the Member for Wycombe (Sir R. Whitney). His view is similar to that of my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke), who said of the Maastricht treaty that he had not read it.
    Sir Raymond Whitney: Will my hon. Friend give way?
    Mr. Cash: In a minute. [Interruption.] Perhaps tomorrow! We have to consider the control and command to understand the basis on which such treaties are constructed. Without doing that, we do not know what is going on—
    It being one and a half hours after the commencement of proceedings on the motion, Madam Deputy Speaker put the Question, pursuant to Standing Order No. 16 (Proceedings under an Act or on European Union documents).
    Madam Deputy Speaker: I think the Ayes have it.
    Hon. Members: No.
    Division deferred till Wednesday 21 March, pursuant to Order [7 November 2000].

    DELEGATED LEGISLATION
    Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation) [Queen's recommendation having been signified],

    DATA PROTECTION AND FREEDOM OF INFORMATION
    That the following provision shall be made with respect to the salary of the Information Commissioner—

    (1) In respect of service from 30th January 2001 to 31st March 2001, the salary of the Information Commissioner shall be at a yearly rate of £85,000.

    (2) For each year starting with 1st April. From 2001 onwards, the yearly rate shall be increased by the average percentage by which the mid—points of the Senior Civil Service pay bands having effect from 1st April of that year have increased compared with the previous 1st April.

    162

    (3) The mid—point of a Senior Civil Service pay band is the point half way between the maximum and the minimum.—[Mrs. McGuire.]

    Question agreed to.
    Madam Deputy Speaker (Mrs. Sylvia Heal): With permission, I shall put together the remaining motions relating to delegated legislation.
    Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

    SOCIAL SECURITY
    That the draft Social Security (Inherited SERPS) Regulations 2001, which were laid before this House on 26th February, be approved.
    HIGHWAYS
    That the draft Street Works (Charges for Unreasonably Prolonged Occupation of the Highways) (England) Regulations 2001, which were laid before this House on 26th February, be approved.

    LEGAL SERVICES COMMISSION
    That the draft Criminal Defence Service (Choice in Very High Cost Cases) Regulations 2001, which were laid before this House on 26th February, be approved.
    That the draft Criminal Defence Service (Representation Order Appeals) Regulations 2001, which were laid before this House on 26th February, be approved.

    CLIMATE CHANGE LEVY
    That the draft Climate Change Levy (Use as Fuel) Regulations 2001, which were laid before this House on 26th February, be approved.
    That the draft Climate Change Levy (Combined Heat and Power Stations) Prescribed Conditions and Efficiency Percentages Regulations 2001, which were laid before this House on 26th February, be approved.
    That the draft Climate Change Agreements (Energy—intensive Installations) Regulations 2001, which were laid before this House on 26th February, be approved.
    That the draft Climate Change Levy (Electricity and Gas) Regulations 2001, which were laid before this House on 26th February, be approved.
    That the draft Climate Change Levy (Solid Fuel) Regulations 2001, which were laid before this House on 26th February, be approved.

    TERMS AND CONDITIONS OF EMPLOYMENT
    That the draft Part—Time Workers (Prevention of Less Favourable Treatment) Regulations 2001, which were laid before this House on 26th February, be approved.
    That the draft National Minimum Wage Regulations 1999 (Amendment) Regulations 2001, which were laid before this House on 26th February, be approved.

    CRIMINAL INJURIES COMPENSATION
    That the Draft of Alterations to the Criminal Injuries Compensation Scheme, which was laid before this House on 5th March, be approved.
    ACCESS TO JUSTICE
    That the Code of Conduct for Employees of the Legal Services Commission who provide services as part of the Criminal Defence Service, which was laid before this House on 6th February, be approved.

    FINANCIAL SERVICES AND MARKETS
    That the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (S.I., 2001, No. 544) dated 26th February 2001, a copy of which was laid before this House on 27th February, be approved.
    That the Financial Services and Markets Act 2000 (Carrying on Regulated Activities by Way of Business) Order 2001, which was laid before this House on 27th February, be approved.
    That the draft Financial Services and Markets Act 2000 (Exemption) Order 2001, which was laid before this House on 27th February, be approved.—[Mrs. McGuire.]
    Question agreed to.

  LIAISON COMMITTEE (SUB—COMMITTEE)
  Motion made,
  That Standing Order No. 145 (Liaison Committee) be amended as follows:
  Line 31, at end add—

  `The committee shall have power to appoint a sub—committee, which shall have power to send for persons, papers and records, to sit notwithstanding any adjournment of the House, and to report to the committee from time to time.

  The committee shall have power to report from time to time the minutes of evidence taken before the sub—committee.

  The quorum of the sub—committee shall be three.'—[Mrs. McGuire.]

  Hon. Members: Object.

  SCIENCE AND TECHNOLOGY COMMITTEE
  Order read for resuming adjourned debate on. Question [31 January],
  That the Select Committee on Science and Technology shall have leave to meet concurrently with any committee of the Lords on science and technology or any sub—committee thereof, for the purpose of deliberating or taking evidence, and to communicate to any such committee its evidence or any other documents relating to matters of common interest—[Mrs. McGuire.]
  Hon. Members: Object

  SELECT COMMITEES (JOINT MEETINGS)
  Motion made,
  That Standing Order No 152 (Select committees related to government departments) be amended as follows:
  Line 40, before the 'European' insert the words 'Environmental Audit Committee or with the'.
  Line 50, before the 'European' insert the words `Environmental Audit Committee or with the'.
  Line 52, at the end insert the words:—
  `(4A) notwithstanding paragraphs (2) and (4) above, where more than two committees or sub—committees appointed under this order meet concurrently in accordance with paragraph (4)(e) above the quorum of each such committee or sub—committee shall be two.,—[Mrs. McGuire.]
  Hon. Members: Object.

  PETITION

    Winter Fuel Payment
    12.41 am
    Mr. Desmond Browne: I present the petition on behalf of my constituent Mrs. Margaret Lees of Kilmaurs and more than 2,000 other signatories from my constituency and other parts of the United Kingdom. It supports the extension of the annual winter fuel payment to physically disabled people under the age of 60.
    To the House of Commons
    The Petition of the Kilmarnock Forum on Disability and others,
    Declares that younger physically disabled people (ie. those under retirement age) are not eligible to receive the annual Winter Fuel Payment made by the Department of Social Security.
    The Petitioners therefore request that the House of Commons urge the Secretary of State for Social Security to review the eligibility to receive the Winter Fuel Payment for younger physically disabled currently receiving medium or high levels of Disability Living Allowance and/or Income Support.
    And the Petitioners remain, etc.
    To lie upon the Table.

  Glass Industry
  Motion made, and Question proposed, That this House do now adjourn.—[Mrs. McGuire.]
  12.42 am
  Mr. Bill Rammell: I am very pleased to have the opportunity of this Adjournment debate to represent the interests and real concerns of my constituents who work at United Glass in Harlow. United Glass employs more than 300 people in Harlow, and theirs are the kinds of skilled and semi—skilled manufacturing jobs that used to be the bedrock of the local economy. However, they are also the kind of jobs of which we have lost so many over the past 20–odd years.
  To put that in context, as recently as 1979 more than 50 per cent. of the jobs in Harlow were in manufacturing, whereas today the figure is barely above 20 per cent. Those are important jobs, because they provide ordinary working people with a career, stable employment and good remuneration—in short, the kind of job security to which many people aspire.
  Those good, high—quality jobs would be at risk if the Government were to grant regional selective assistance—which has been applied for through the Department of Trade and Industry—to Quinn Glass to build a new glass manufacturing plant on the site of the old Ince B power station that straddles the border between Chester and Ellesmere Port. That application is the nub of the case that I wish to make this evening.
  In making that case, let me make it clear that I am not asking for special favours, or for preferential treatment for United Glass and my constituents. I am simply asking for a fair deal and a level playing field. Open and fair competition in the marketplace is a spur to increased competitiveness. However, United Glass—along with other glass manufacturers—is not given taxpayers' money to support its enterprise, and I do not see why Quinn Glass should be given taxpayers' money to start an operation in a market in which there is already significant overcapacity, when the granting of regional selective assistance would—a great deal of evidence suggests—lead to the provision of jobs in the north—west of England at the expense of jobs in my constituency and elsewhere in Britain.
  I am speaking not just on behalf of United Glass and my constituents; every other glass manufacturer in Britain is concerned about the Quinn application. The Minister will know that my hon. Friends the Members for Barnsley, Central (Mr. Illsley), for Ochil (Mr. O'Neill), for Cunninghame, South (Mr. Donohoe) and for Normanton (Mr. O'Brien), among others, have enunciated significant concerns, and that many of us accompanied representatives of the glass manufacturing industry to see a DTI Minister before Christmas to express our anxieties. We are united in our view that taxpayers' money should not be used to support Quinn Glass at the expense of jobs in our areas.
  Part of my reason for initiating the debate is that our fears are based on historical precedent. In April 1997, the Northern Ireland Office granted Quinn Glass a £13 million grant from the Norther Ireland Industrial Development Board to develop a plant at Derrylin, in County Fermanagh. As there was already overcapacity in
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  the industry, that has led—perhaps unsurprisingly—to a loss of nearly 1,000 jobs over the past few years, and a fall in profitability of nearly 50 per cent.
  The development in Northern Ireland was undoubtedly a factor in the closure of the United Glass plant in St. Helens. I have to say, however, that just as bad as the actual decision and its impact was the way in which the decision was made by the last Conservative Government. It was, by any reckoning, a hugely controversial decision, made on 17 April 1997. The contract was signed on 1 May 1997, the day of a general election that everyone—including, I believe, the Conservative party and Conservative Ministers—knew would bring a change of Government. Yet despite the knowledge that there would be a new Government with a new outlook, a new set of priorities and a new set of policies, the Conservative Government had the arrogance to press ahead with the decision, and by the time this Government came to power it was too late to reverse it.
  On the basis of that precedent, my constituents have a real fear that what happened in Northern Ireland can happen again. I hope and believe that under this Labour Government things can and will be different.
  Let me say something about the background to the current economic situation in the glass manufacturing industry, against which I think this application should be judged. There is undoubtedly overcapacity in the industry, and there are real problems in regard to profitability and sustainability. The UK glass manufacturing and container industries unquestionably face real problems, and have done for some time. Demand has been falling, owing to increased competition from alternative packaging materials, while supply has been increasing, owing to the industry's heavy investment in new technologies that have produced substantial productivity advances.
  Across the European Union, that has led to overcapacity, currently estimated at about 10 per cent. In Britain, the results have been stark: since 1997 glass manufacturing sales have declined by 7 per cent., and there has been a dramatic decline of 48 per cent. in earnings. That loss of profitability has been translated directly into a loss of jobs: the number of people employed in the industry has fallen from 5,400 to 4,400, a drop of nearly 20 per cent. I know of no other industry in which there has been such a significant decline in such a short time.
  Moreover, important elements of production have moved outside the United Kingdom because of the continuing high value of the pound outside the euro, which makes it more economical to produce goods outside the UK. That has applied to Heinz, Cadbury and Ovaltine. Let me say as an aside that the situation is a powerful antidote to the views of the Conservatives and other anti-Europeans—from whom we have just been hearing—who argue that we should never join the single currency, regardless of the consequences for British manufacturing industry.
  The situation is undoubtedly full of real difficulties. That is why the Quinn Glass application concerns us so much. We are concerned that Government funds could be used to increase capacity that will cause the loss of jobs elsewhere in the industry. The Quinn Glass proposal, to put it into context, is to establish capacity in the north—west of England to produce 1.1 billion bottles a

  167
  year. Based on year 2000 sales figures, such capacity equates to about 16.4 per cent. of total industry sales. On any analysis, that is a very substantial development.
  ECOTEC Research and Consulting has been commissioned by both United Glass and Wrexham Glass to quantify the likely impact of the establishment of such additional production on three areas of Great Britain—on Harlow, in my constituency; on the central belt of Scotland; and on south Yorkshire. There is already significant glass production in all three areas.
  ECOTEC's research and analysis is very clear that, overall, the best we can hope for is that the new facility will result in a zero-sum gain, with output from the new facility likely to displace a roughly equivalent amount of output from other United Kingdom-based producers. On a more pessimistic analysis, which is offered in the research, there is a view that for every new job that might be created at the proposed site, two existing jobs in the industry and in supporting businesses elsewhere could be lost. If Quinn Glass wants to wreak such havoc on the United Kingdom glass industry, so be it. However, I do not know why it should be aided and abetted by taxpayers' money in so doing.
  I should like, finally, to deal with two red herrings that are being offered to justify and support the Quinn application. First, it is suggested that the plant will not hit production elsewhere in Britain because Quinn wants to focus on exploiting the current importation of glass from elsewhere in the European Union. Last week's Packaging Magazine had clearly bought the spin from Quinn Glass which argued that import substitution would be its main target. I believe that that reassurance is false. I say that for various reasons.
  There is no evidence from Quinn Glass in Northern Ireland that it has a strategy in place to substitute for imports. We also have to understand the nature of the increase in imports—from 7 to 13 per cent. of containers—in recent years. The major driver of that increase has been the high value of sterling. The situation for any of the companies is unlikely to change until the value of sterling decreases appreciably. Moreover, when sterling's value does depreciate, not only Quinn Glass but all United Kingdom glass manufacturers are likely to benefit.
  It is also very important to understand that more than two thirds of imports into Britain are substitute production—for example, to replace production lost when furnaces are being refurbished—or are more specialised glass containers, such as toiletries and cosmetics and pharmaceutical containers. The specialised containers require specialised machines and, in some cases, different glass composition. However, there is no evidence to suggest that Quinn Glass intends to invest in such equipment at the proposed mainland site. Indeed, the reverse is true, with a suggestion that the site will produce high-volume beverage containers.
  As for the scale of available imports that Quinn could target, those 330 million containers are dwarfed by Quinn Glass's proposed 1.1 billion production capacity in the north-west of England. The figures just do not add up. The argument that everything will be all right and that the new plant will simply target imports lacks credibility and should be taken with a pinch of salt.
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  The second red herring that has to be exposed is the notion that if Quinn Glass does not go to the north-west of England, the jobs that would have been provided there will be lost to northern France, where the application will receive French Government support. There is a link between the situation France and that in Germany. In Germany, there have been moves to plastic in the soft drinks and water sectors, coupled with implementation of a deposit system that will soon be applied to currently non-returnable glass. Consequently, German glass demand is expected to decrease in the next two years by a staggering 1 million tonnes. That is such a dramatic change for the German glass industry that it has engaged consultants to work on securing German Government grants to close down glassworks.
  As 40 per cent. of the German glass industry is owned by French companies, and as there is already overcapacity in both France and the Benelux countries, it is inconceivable that, in current circumstances, the French Government would consider grant aid for extra capacity.
  I am grateful to my hon. Friend the Member for Barnsley, Central, who has informed me that the Barnsley development agency, which has established a good line of communication to the French authorities because of the sensitivity of the issue, has been unable to trace any line of inquiry from a British company. The argument that the jobs would go to France is unsustainable.
  I believe that thy, arguments against the granting of regional selective Assistance are very strong. As the Minister knows, in many senses the most important criterion in deciding whether to grant such assistance is the displacement impact on jobs. If it is concluded that grant aid would simply displace jobs elsewhere, the grant should be refused—and it is clear to me and to many others within the industry that grant aid in the circumstances that I have described would lead to a displacement of jobs. I hope that that will weigh heavily in the making of the final decision, and ultimately lead to a refusal.
  There are also strong grounds for believing that granting assistance would be deemed to be unfair state aid under European Union competition rules. Indeed, several glass manufacturers are considering approaching the European Commission over the issue if the Government grant aid.
  This is an issue of real significance and importance to my constituents in Harlow. More than 395 people are employed in the glass and associated sectors locally—320 directly by United Glass and the remainder indirectly supported by the sector It is not only the people who are directly employed who would be affected; there is also the knock-on benefit to the local economy. ECOTEC has estimated the associated supplier expenditure at £1.64 million a year, and employee expenditure in the Harlow economy at £3.6 million a year.
  This is an enormously important issue in Harlow, both for its economy and for the people whose employment depends on the plant. My constituents simply would not understand if Government money, provided by the taxpayer, were used to undermine their jobs and their local economy. I therefore strongly urge the Government to listen to our concerns. I hope and believe that they will act to protect my constituents' interests. All we are asking for is a level playing field, and I hope that we shall get it.
  12.57 am
  The Minister for Small Business and E-Commerce (Ms Patricia Hewitt): I begin by congratulating my hon. Friend the Member for Harlow (Mr. Rammell) on securing the debate and on drawing attention so eloquently to what I know is an enormously important issue for him and for other right hon and hon. Members who have glass packaging plants in their constituencies.
  My hon. Friend has certainly teen a strong and assiduous supporter of those of his constituents who work at the United Glass factory in Harlow. He has set out admirably their concerns and the issues at stake in the regional selective assistance application. I must also acknowledge, as he has done, the close interest taken by other right hon. and hon. Members in the future of other existing glass packaging plants it South Yorkshire, Scotland and elsewhere, and the reaction of others who also see threats from potential investment in new plant.
  I know that my hon. Friend and several other hon. Members expressed those serious concerns on behalf of their constituents when they came with employee and management representatives from son le of the major firms to see my right hon. Friend the Minister for Trade just before Christmas.
  We do not often debate the subject of glass in the House. I suspect that we have all tended to take glass packaging for granted, whether it was the humble milk bottle on the doorstep, the traditional bottle of beer, or the bottle of headache pills. Glass bottles have been with us for centuries. However, we have now come to accept that milk can also come in cartons, beer in cans and pills in foil wrapping in boxes.
  The fact that we still have a sizeable glass packaging industry in Britain is a reflection of the flexibility and adaptability of the manufacturers who have innovated, designed new products and sought out new markets. At the same time, there have been very strong competitive pressures on the glass industry generally which have, unfortunately, led to real difficulties, such as at Ravenhead Glass at St. Helens. The glass packaging sector, in particular, has had to respond to its own competitive threats, not least from alternative packaging materials.
  Before I turn to the specific issue raised by my hon. Friend, perhaps I could refer to the support that has been given to the British glass industry since the Government came to office—not, of course, including the previous grant to Quinn Glass. Since 1 May 1997, offers of regional selective assistance totalling some £18 million have been accepted by the United Kingdom glass industry overall, of which £1 million has gone towards the manufacture of hollow glass. In addition, my Department has been working with British Glass and Glass Technology Services Ltd. in a number of areas, including financial support for an innovation project to design safer screw threads on glass bottles and assistance with the establishment of a glass manufacturing improvement club.
  We held discussions last year with British Glass, the trade association for the sector, about other projects, including a competitiveness analysis I regret that those discussions have not progressed s we had hoped. However, I stress that if the glass industry wishes to take these or other issues forward, the door remains open. I strongly urge them to consider working with the Department on a competitiveness analysis. I hope that my hon. Friend will make that point to his constituents and to
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  British Glass. A competitiveness analysis can lead to the identification of further areas in which the Department and the sector could work to best advantage.
  On my hon. Friend's central concern, Quinn Glass has confirmed publicly that it is seeking UK Government support towards the establishment of a new manufacturing facility in the north-west region. I can therefore also confirm that the Department is currently considering and appraising an application for regional selective assistance from the company. However, as with any RSA application, all the information contained in it is commercially confidential. I know that my hon. Friend understands that, and I hope that he will also understand when I say that I am not able to discuss the company's application in detail.
  In potentially sensitive cases such as this, I have heard it suggested that the Government should not even consider an application for regional selective assistance. However, I stress that providing an application meets the qualifying criteria for regional selective assistance; we cannot refuse to consider it. Each application is rigorously assessed against a number of detailed criteria which are published. The application is then considered by the Industrial Development Advisory Board—an external adviser—which makes a recommendation to Ministers on each case.
  I am afraid, for the reasons that I have given, that I am not able to discuss progress on the Quinn Glass application for RSA, nor can I say when the case might reach the final stages of consideration. However, I can assure my hon. Friend and his constituents that the specific issue of job displacement is one of the key criteria that has to be considered on any RSA application and will therefore be considered on this application.
  I have one final point on Quinn Glass; my hon. Friend has also referred to it. The Government would be powerless to prevent any investment by Quinn Glass if the plant were to be constructed without support—assuming, of course, that it met planning and other appropriate requirements. Nor could we stop imports to this country if that plant were to be constructed on an alternative site elsewhere. I am sure that my hon. Friend and his constituents understand that.
  I referred earlier to the meeting with my right hon. Friend the Minister for Trade in December, when he indicated that he was reviewing the glass packaging sector. That work has progressed on two fronts. First, as part of the appraisal for this application, against the published criteria, we are considering a number of economic areas, including job displacement. That work of appraisal is in hand but, like the Quinn Glass RSA application, the information will have to remain commercially confidential.
  We have also commissioned Key Note Ltd. to update an earlier market research report on the glass packaging sector published in 1999. That earlier report has been extensively quoted in other papers on the glass packaging sector which I have seen. The new report from Key Note Ltd. has just been received by the Department. It will form part of the information used in appraising the Quinn Glass RSA application. I am therefore pleased to announce that the Department can now make copies of the new Key Note market research available to the glass packaging industry.
  We are also maintaining close contact with the sector, and officials are scheduled to meet representatives from a number of manufacturers, including United Glass, next

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  week. I am sure that my hon. Friend will appreciate that in all our dealings with the glass packaging sector, Ministers and officials have tried to provide as much information as possible while respecting the requirements of commercial confidentiality.
  I must also mention letters from right hon. and hon. Members and information about the glass packaging industry which we have received from other parties in recent months. We have received a report commissioned by Barnsley development agency from ECOTEC Research and Consulting Ltd., which considered the economic impact of the Quinn Glass proposal on Barnsley, South Yorkshire and the wider regional economy. We have had a briefing paper on the UK glass packaging industry structure dated November 2000 and a paper from British Glass entitled "The UK Glass Container Industry Review", dated spring 2001. All those reports are being considered during the appraisal of the Quinn Glass RSA application.
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  My hon. Friend mentioned overcapacity, which is an important issue in the sector. I was interested to read in the latest paper from British Glass that the estimate of overcapacity in the glass packaging sector is now only 5 per cent. compared with the figure of up to 20 per cent. which was quoted it the meeting in December. I also noted that imports into the United Kingdom in 1999 took some 19 per cent. of the market, although of course part of that total may have come from UK firms importing from their associate plants on the continent.
  I end by saying how much I appreciate the enormous anxiety that will be felt during this period of uncertainty by the constituents whom my hon. Friend represents. Once again, I assure him and his constituents that we fully understand the importance of the issue and that we will take all the relevant factors, including job displacement, into account when the decision is made on the basis of the published criteria.
  Question put and agreed to.
  Adjourned accordingly at seven minutes past One o'clock.