Commons Sitting of 7 April 2003

Preamble
The House met at half-past Two o'clock
PRAYERS
[MR. SPEAKER in the Chair]
Oral Answers to Questions
  CULTURE, MEDIA AND SPORT
  The Secretary of State was asked—
  CULTURE, MEDIA AND SPORT

    Arts (Young People)
    Mr. Graham Allen: When she next plans to visit Nottingham, North to discuss Government policy on the arts and young people. [104047]
    The Secretary of State for Culture, Media and Sport (Tessa Jowell): Last summer, I announced the biggest increase in funding for the arts for at least 20 years. On 25 March, the Arts Council of England announced its spending plans for the next three years, which will provide major increases in funding for artists, performers and arts organisations in my hon. Friend's constituency and across the country. Support for young
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    people is a key theme and investment in creative partnerships is set to grow from £25 million in the current year to £50 million in 2005–06.
    Mr. Allen: In trying to hold the Government to account on creative partnerships, I made inquiries of Ellis Guildford, Trinity, Brocklewood, Gladehill, Hempshill Hall, Highwood, Rufford and Glenbrook schools, and every one had nothing but praise for the scheme that the Government have introduced. May I therefore ask my right hon. Friend whether she will ensure that this universally acclaimed scheme, as it operates in my constituency, will have sustainable funding?
    Tessa Jowell: I thank my hon. Friend. He will be pleased to learn—although he has done his research pretty well already—that 13 out of the 23 schools in the Nottingham creative partnership are in his constituency, which reflects the nature of deprivation in his constituency. Yes, it is our intention that in due course, and on the basis of careful evaluation, creative partnerships will become a national programme so that children all over the country, wherever they live or are at school, can be exposed to the benefits of arts and creativity from a very early age.

    Arts (Small Towns)
    Mr. Colin Pickthall: What support her Department offers to small towns without theatres, galleries, or museums to create such facilities. [107048]
    The Minister for Sport (Mr. Richard Caborn): The majority of the funding that my Department provides for theatres, museums and galleries is broadly directed to supporting existing cultural institutions, aiming to broaden access and attract new audiences. We do, however, offer support to new facilities in a number of ways. As far as theatres are concerned, that comes through the Arts Council of England, a lottery

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    distributor that can provide funding and advice at a regional level. In the museums and galleries sector, through our £70 million investment in the renaissance in the regions initiative, a network of regionally based museum development officers will be established to help small and medium-sized museums, and grants for museums will continue to be available from the regional agencies.
    Mr. Pickthall: There must be many small and middle-sized towns such as Skelmersdale, which has a population of 42,000, yet has no theatre, no gallery, no museum and no cinema, although there is substantial demand that is met only at the margins by make-do venues in schools and the library. Does my right hon. Friend agree that up-to-date cultural venues have an important part to play in economic regeneration in towns such as Skelmersdale; and does he therefore agree that some of the grant aid earmarked by the Government for economic regeneration should be used to help communities like Skelmersdale establish such cultural venues?
    Mr. Caborn: The answer is obviously yes, but to a large extent local authorities or partnerships drive that process. We are not imposing it from the centre, and I do not think that my hon. Friend would want that to happen, either. In terms of theatres, a dialogue with the Arts Council of England should take place at a regional level. My hon. Friend should visit his local authority to ask what it is doing proactively to try to deliver the types of facilities that he wants.
    Mr. Andrew Rosindell: Will the Minister take steps to ensure that boroughs such as the London borough of Havering are given a fairer share of grant aid for museums and for our local theatre in Hornchurch? Many boroughs on the outer rim of London are not getting their fair share in that respect: will he ensure that we do in future?
    Mr. Caborn: We want to be fair. If the hon. Gentleman writes to me, I will look into what is happening in relation to the funding agencies and the formula that has been applied to that part of London. I shall try to be as helpful as I can.
    Mr. Derek Wyatt: What discussions has my right hon. Friend had with his colleagues in the Department for Education and Skills in relation to bids for specialist schools in the arts? In Sittingbourne, which has a population of 42,000—about the same as that which my hon. Friend the Member for West Lancashire (Mr. Pickthall) mentioned—we, too, have no museums, art galleries and the like. If there was some combination between the work of the two Departments there is just a chance that our schools might get specialist status in the arts.
    Mr. Caborn: There are 173 specialist arts colleges; I do not know whether any of them fall within my hon. Friend's constituency. We do have a dialogue with other Departments about trying to use the arts and, indeed, sport and physical activity. One of those with which we have the most proactive approach is the Department for Education and Skills, which is making a difference in
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    arts colleges and specialist sports colleges. If my hon. Friend writes to us, we will try to be helpful in providing information.
    Michael Fabricant: Let them come to Lichfield, which has a population of only 35,000 but boasts the Garrick theatre, which is an eco-friendly theatre that is about to open. Of course, David Garrick was born and brought up in Lichfield. A new arts gallery will shortly open and my constituency contains the St. Mary's heritage centre. However, may I ask the Minister about smaller theatres such as that in Pipe Ridware in my constituency? It has only 70 seats yet still puts on performances. It has been unable to secure grants from the Arts Council of England or any other organisation that gives lottery grants because such organisations say that the theatre must provide training schemes for young people in the area. That is impossible for such a small theatre, so how can we get round the problem?
    Mr. Caborn: That investment shows very clearly that we do not discriminate against Tory constituencies. I thought that the hon. Gentleman was advertising tourism and inward investment when he got to his feet and extolled the virtues of his constituency. I obviously cannot respond to his specific point but if he writes to me, I shall take it up with the Arts Council because I assume that the theatre has been in contact with that body.
    I have said clearly that we want viable theatres of the nature that the hon. Gentleman mentioned, but I stress that the broad approach of our policy is to try to get current facilities and investment to work as efficiently and effectively as possible. That is the right approach and after we have achieved that, we can move on to further developments for arts, museums and galleries.

    Arts (Inner Cities)
    4. Mr. Adrian Bailey: What steps the Arts Council is taking to promote arts projects in inner-city areas.[107049]
    The Secretary of State for Culture, Media and Sport (Tessa Jowell): The record levels of funding increase announced for the arts last week—the biggest for 20 years—recognise the importance that this Government attach to the arts and to extending their benefit to anybody who wants to enjoy culture. Jubilee Arts in Sandwell is a good example. It has seen an increase in its funding from more than £107,000 this year to £623,000 by the end of the spending round in 2005–06. That represents getting on for a 500 per cent. increase, which is in addition to the £29 million of lottery investment toward the c/PLEX building that will house the Jubilee Arts project. I would like to pay tribute to my hon. Friend for his advocacy of that important project.
    Mr. Bailey: I thank the Secretary of State for her reply. I welcome the national increase in arts funding and especially the money for the Jubilee Arts organisation and the c/PLEX project, which is an innovative arts and technology project that is pioneered by Sylvia King, who is one of my constituents. The Secretary of State may not be aware that the project has stimulated a further £250 million of regeneration and

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    development money. Will she examine whether the example of West Bromwich and c/PLEX can be used to encourage other inner-city areas to promote arts-driven regeneration projects?
    Tessa Jowell: I am very grateful to my hon. Friend for his suggestion. We believe that there are tremendous opportunities to link regeneration and culture. We have seen the benefits in cities such as Newcastle, Liverpool and Manchester; indeed, in almost all 12 of the cities that are bidding to be the European capital of culture. I shall ensure that the beneficial experience of West Bromwich is added to that proud list.
    Sir Sydney Chapman: While I appreciate and welcome the increase of funding through the Arts Council of England, would the Secretary of State agree, on reflection, that that sum has been completely dwarfed by the significant decrease of grants made available from the New Opportunities Fund and the community fund? Surely she should address the reasons for that decline if we are to help the arts in the way in which we all want.
    Tessa Jowell: I do not accept the premise of the question. The sports and arts are funded by the Exchequer and the lottery, which in the case of the arts is provided in equal parts. There has been a small decline in lottery ticket sales in recent years, but the regulator and the operator are confident that that trend is set to reverse. The arts across every constituency in this country can look forward to a bright future because they have a Government who are committed to investing in them as part of our central purpose, not as an afterthought.
    Mr. Barry Sheerman: Does my right hon. Friend agree that those cities that do not become the European capital of culture or win the bid feel rather bruised by that? Many of us in Yorkshire believe that having been left off the shortlist, Bradford feels that it is unloved and uncared for in the arts. Surely all those other cities that will not become the European capital of culture should have a chance that is not European funded but funded by her Department to take significant initiatives in cultural events.
    Mr. Chris Bryant: What about Cardiff?
    Tessa Jowell: No doubt we could hear a chorus of suggestions around the Chamber.
    Bradford is a wonderful city and I look forward to visiting it towards the end of the month. It proudly boasts many cultural institutions. My hon. Friend is right: bidding for the capital of culture unlocked vision and ambition in those bidding cities, including Bradford. We are considering ways in which the ambition in those bids can—certainly in part—be realised.

    Television (Cross-ownership)
    Norman Baker: If she will make a statement on her policy on cross-ownership rules in respect of (a) Channel 5 and (b) ITV. [107050]
    The Secretary of State for Culture, Media and Sport (Tessa Jowell): The Government's policy is to deregulate where possible to promote investment and growth. However, we will retain those key ownership rules that safeguard a plurality of media voices and tough content controls to ensure quality and diversity. The Communications Bill, therefore, removes all rules on the ownership of Channel 5, which has only a 6 per cent. audience share and 80 per cent. coverage of the UK. The Bill maintains the rule that prevents a large newspaper proprietor buying into ITV, which in contrast with Channel 5 has universal access to a mass audience.
    Norman Baker: I thank the Minister for that detailed response, but is not there something illogical about her position? The logic she applies only continues if Channel 5 continues to have a small share of the audience and ITV continues to have a large share. Surely the danger is that Mr. Murdoch or one of the other big proprietors buys Channel 5 and injects money into it that leads to a big increase in audience share—the sort of audience share that she rules out for cross-media relaxation on ITV.
    Tessa Jowell: It is extraordinarily interesting to hear Liberal Democrat views on the important issue of cross-media ownership. On the day that they tabled amendments to the Communications Bill in Committee, they overslept and Committee members were denied the opportunity to have the debate that the hon. Gentleman is now trying to initiate rather late in the day. However, as it is the middle of the day and Liberal Democrats are awake, I can tell him that we anticipated precisely the scenario to which he refers by creating provision in the Bill for the public service broadcasting requirements on Channel 5 to be strengthened if there is a significant increase in its audience share.
    Mr. Desmond Swayne: Tough content controls can stand separately from ownership requirements, so why not set ITV free as well?
    Tessa Jowell: Because ITV has a mass audience. It covers 100 per cent. of the country and has an audience share of about 24 per cent. That may well change. It is precisely because we take a different view of media ownership than the Opposition—we believe that competition alone is not enough to safeguard plurality and diversity—that we have retained a rule restricting cross-media ownership for ITV for the reasons that I identified, but have proposed to lift that rule for Channel 5, a minority channel with a small audience share.

    Sports (Maintained Schools)
    Mr. John Bercow: If she will make a statement on the level of sporting activity undertaken by pupils in maintained schools. [107051]
    The Minister for Sport (Mr. Richard Caborn): It will probably come as a surprise to the hon. Gentleman, but comprehensive data on physical education and school sports have never been collected. However, I can assure him that we are putting that right. On 3 February, my right hon. Friend the Secretary of State for Culture, Media and Sport placed in the Library of the House the initial results of the survey of school sport co-ordinator partnerships that took place towards the end of 2002. Updated figures were published on the website on 1 April. The second annual report on the Government's plan for sport shows that one pupil in seven has moved into community sports or physical activity clubs, one pupil in five is involved in inter-school competitions, and 50 per cent. are involved in intra-school competitions and events. Those figures are still well below the targets that we have set; they are not satisfactory. That is why, over the next three years, we are investing about £1 billion to put facilities and people in place so as to build on the figures that I have just given.
    Mr. Bercow: I am grateful to the right hon. Gentleman for his candid and informative reply. As long ago as 5 June 1998, the then Minister for Sport, the hon. Member for West Ham (Mr. Banks), told the House that there should be an irreducible minimum of three hours per week of sport for children in schools. However, almost five years later, the Government's two-hour PE and school sport target is missed respectively by three quarters, three fifths and two thirds of schools at key stages 1, 2 and 3. Why should we hold out any prospect of success under this Government when their record both past and present is one of miserable failure?
    Mr. Caborn: If the hon. Gentleman wishes to have a serious discussion about this, I do not know where he gets his facts and statistics. I have been quite honest with the House and said that the data have not been available. We are trying to establish a database and, once we have that in place, as we now have, we will be able to measure results consistently. Our target is to offer every child between the ages of five and 16 two hours of quality physical activity or sport every week. The investment of £1 billion over the next three years is to put in place facilities—there will be something like 2,500 developments across the country through the New Opportunities Fund investment of £560 million—and 3,000 school sport co-ordinators. We now have 201 sports colleges out of our target of 400; and just under 1,000 school sport co-ordinators out of our target of 3,000 to be in place within the next two years. We believe that we have made a significant investment in the development of the infrastructure to bring quality physical activity and sport back into our schools.
    Phil Sawford: Although I accept the points that the Minister has made, is the bigger problem not the drop-out rate from organised sport of people over the age of 16? Does my right hon. Friend agree that partnerships between schools and local communities to expand the use of school sport facilities are making a positive contribution? I welcome the £600,000 from the New Opportunities Fund to refurbish the swimming pool at Montsaye school in Rothwell. That is helping to promote more sporting activity for the school and the local community.
    Mr. Caborn: I welcome what my hon. Friend has said. It is a serious matter that 70 per cent. of young people who leave school and go into the world of work or higher education never return to active sport. In France, the figure is around 20 per cent. We have to look into that. The prerequisite for applications to the New Opportunities Fund for investment through the local education authorities is that funds will be used for community activities. We hope that the £60 million that we are investing through the governing bodies to strengthen the sports club structure the length and breadth of the nation will make a major contribution towards arresting that awful figure of 70 per cent. for people who are not active in sport once they leave school.
    Mr. John Greenway: On statistics, has the Minister seen the latest Sport England survey, published at the end of February, which reveals that the number of children who do not take part in regular weekly PE or sport at the school at all is rising and now stands at 18 per cent.—almost one in five children? Some 51 per cent. of young people do less than two hours of PE a week. Does he agree that that scandalous failure of schools policy must be reversed if we are to tackle child obesity and prevent ill health in later life? I acknowledge what he is trying to do, but can he tell us how the joint public service agreement between his Department and the Department for Education and Skills will be monitored and when we can expect results, because a lot of public money is involved?
    Mr. Caborn: That is exactly what I have suggested. The hon. Gentleman refers to a survey by Sport England and, helpful though that survey is, it is just a snapshot of what is happening in this country. We need much more robust figures. As the Government are investing such amounts of money into sport and physical activities, it is necessary to get robust baseline data. In fact, that is exactly what we are doing. There is no disagreement between those on the two Front Benches—we want to ensure that obesity in our young people is reduced, along with diabetes as well. That is why the investment is there.
    According to the National Audit Office, the wider nation's economy loses £2 billion a year because of obesity, £500 million of which falls on the national health service. Those horrendous figures need to be arrested, and we are setting off at the very beginning—in our primary and infant schools—and moving on to secondary schools and, I hope, into the club structure as well.

    Heritage Sites
    7. Mr. Tam Dalyell: What recent discussions she has had with her EU counterparts on protection of international heritage sites. [107052]
    The Minister for Tourism, Film and Broadcasting (Dr. Kim Howells): Officials from my Department attended a specially convened session of the world heritage committee at UNESCO in Paris last month. My Department will also be represented at the main session of the world heritage committee in China this summer, and I am sure that my hon. Friend will know that we are supporting the Dealing in Cultural Objects (Offences) Bill, introduced by the hon. Member for Sheffield, Hallam (Mr. Allan), which will allow much easier prosecution of anyone who tries to trade in this country in objects stolen or looted from cultural heritage sites across the world.
    Mr. Dalyell: I gave the Department notice of my supplementary question mid-morning. Has the Minister had discussions with either the international body or the Ministry of Defence about the fate of the museum at Basra, the shrine at Al-Kawaz, the great mosque that is 16 km to the west of Bara, or the early Islamic site at Tulul ash Shuaiha? In the light of the answer that was given at oral questions by the Prime Minister before the war started that everything possible would be done to protect sites of holy or cultural interest, why has no one in the Government contacted, after their pleas, Professor Postgate and his team at Cambridge, Harriet Crawford of the Institute of Archaeology or John Curtis of British Museum?
    Dr. Howells: I have not had discussions with the experts that my hon. Friend mentions, but I have been informed that representatives of the British armed forces have discussed with those of our coalition allies how best to make all coalition forces aware of the many historic and important sites in Iraq, and I am sure that they will do all in their power to minimise the damage to those sites. I am sure that my hon. Friend will know that the United Kingdom is prohibited under article 53 of additional protocol 1 to the Geneva convention from directing any attack on cultural property, unless, of course, that property is used to support Iraq's military effort.
    Mr. John Redwood: Will the Minister use his best efforts in the European Union to try to get our partners around the Mediterranean to do rather better at identifying such sites and protecting them? Is this not another case of Britain playing the game and enforcing the rules much better than our southern partners? Can he help them to do rather better?
    Dr. Howells: I am not aware that the countries to which the right hon. Gentleman refers are deficient in any sense. If he has examples of such sites that are not being identified and recognised in other parts of the world, I am sure that he is ready to write to me about them; I have not heard of them.
    Mr. Peter Pike: When considering international heritage sites, will my hon. Friend take
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    into account objects at the birthplace of the industrial revolution, such as the weaving mill at Queen street in Burnley? [Laughter.] Well, such things still work. We need to preserve them, to ensure they are successful and to attract tourists to them.
    Dr. Howells: The Government have a tremendous record of identifying, looking after and putting money into sites relating to the industrial revolution and to industry in general. I will certainly look at the example that my hon. Friend has given.

    Lottery
    Bob Spink: How many responses she has received to the consultation on the future of the national lottery. [107053]
    The Secretary of State for Culture, Media and Sport (Tessa Jowell): The Department received 425 responses to the consultation paper on the review of lottery funding.
    Bob Spink: I declare an interest as a member of the Benfleet horticultural society. I congratulate the Secretary of State on her good humour, and on the professionalism shown by her and by lottery staff in the distribution of grants. Does she agree that lottery sales would increase if grants were directed away from politically correct and controversial schemes towards genuine community-based schemes such as that of the Benfleet horticultural society, which is doing such excellent work in the Castle Point community?
    Tessa Jowell: I looked at the figures relating to the hon. Gentleman's constituency, and I note that his constituents have benefited less than they should have from the distribution of lottery moneys. I hope he understands how seriously I take the need to ensure equitable distribution. As for his swipe at political correctness, what is politically correct today may be progressive and socially acceptable tomorrow. I would bet a small lottery prize that had we been debating the lottery in the early part of the last century, the suffragettes would have been dismissed as politically correct.
    Dr. Vincent Cable: Is the Secretary of State aware that thousands of small retailers are currently having their lottery franchises removed? While her main concern must of course be to maximise the take for good causes, will she look into the growing concentration of distribution that is benefiting supermarkets and disadvantaging small retailers?
    Tessa Jowell: I take the hon. Gentleman's point. I know that Camelot has a rationalisation under way, and that being a lottery distributor it is extremely popular. I am glad it has taken the needs of rural areas into account, but I will keep a close watch to ensure that people in all areas have easy access to shops where they can buy lottery tickets.
    Mr. John Whittingdale: Is it not the case that only six of the 425 respondents favoured merging the community fund and

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    the New Opportunities Fund, while bodies representing voluntary organisations were overwhelmingly against it? Will the Secretary of State assure us that the merger will not go ahead until Parliament has properly considered and approved it?
    Tessa Jowell: As I have told the hon. Gentleman in a parliamentary answer, about 12 respondents expressed a view. The ratio between those expressing reservations and those supporting the merger was 50:50. The proposals arising from the review will form part of a White Paper, which will be published later in the year, and Parliament will have ample opportunity—as Parliament should—to debate not just the merger proposals but the other proposals for revitalising our national lottery.
    Mr. Whittingdale: When the Secretary of State draws up the White Paper, will she say whether she is satisfied that despite the Government's pledge to reduce it, the amount of money still sitting in the national lottery distribution fund stands at £3.2 billion, 14 per cent. over the figure inherited by her Government? Is it riot a scandal that in the last five years more than £1 billion has accumulated in interest payments—money that could have been used to transform the lives of thousands of people?
    Tessa Jowell: First, the hon. Gentleman should understand that the money raised in interest by the NLDF does go into good causes, so the income has been realised for good causes. Secondly, the balances are now at their lowest level for five years, but I agree that the balances at their present level are unacceptable. However, it is important to understand that balances that stand at £3.24 billion represent on the latest figures almost £500 million of over-commitment. That is money being held on account for organisations that have been awarded lottery grants which have yet to be drawn down. The distributors gave an undertaking to halve the level of balances, and I am working with them to ensure that we accelerate the rate of draw-down. Proposals relating to that will form part of the review to be published later this summer.
    Mr. Patrick McLoughlin: Will the Secretary of State be very cautious when she cites figures for lottery money given to constituencies? If she looked at the figures for West Derbyshire, she would tell me that we had had a huge amount of lottery grant over the past few years, but considering that much of that lottery grant goes to the county council for schemes that it is promoting, the money is spread across the county. The figures that she gives are often misleading.
    Tessa Jowell: The figures are not intended to mislead, but if one examines the figures on a countywide rather than a constituency basis, there will appear to be clustering of lottery grants in particular areas. My hon. Friends representing Birmingham constituencies make a similar point about the distribution of grants in Birmingham, and I am sure that there are other examples. One of the purposes of undertaking the review of lottery distribution is to tackle some of these tricky questions. Principles of equity demand that we do
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    everything we can to make sure that organisations right across the country have the opportunity to enrich their communities with successful lottery grants.

    Sporting Facilities
    Mr. Andrew Love: What steps she is taking to improve sporting facilities in disadvantaged areas. [107054]
    The Minister for Sport (Mr. Richard Caborn): The Government believe that sport can play a valuable part in alleviating economic and social deprivation. Programmes such as space for sport and the arts, the New Opportunities Fund school PE and sport funding, the PE, school sport and club links initiative and the community club development programme are all targeted at deprived areas.
    Mr. Love: Edmonton Rangers football club provides sport and recreation to some of the most deprived kids in my constituency. It does a tremendous job, but it could do an even better job if only it had a permanent site. There is a site available, but unfortunately it is owned by a neighbouring local authority, which has left it to rot over the past 15 years. What can my right hon. Friend do to assist clubs such as Edmonton Rangers, which is trying to reach out to deprived kids in my communities, and what action can he take with local authorities, especially those that are not represented in the area, in order to bring such sites back into use?
    Mr. Caborn: I do not know all the details of the case that my hon. Friend describes, but if the facts are as he says, that local authority should re-examine its attitude to sport and physical activity. I know that there have been developments in the area with the participation of the Edmonton sports and social club and the local authority there, and I hope that that results in better facilities, including changing accommodation and all-weather pitches. If my hon. Friend writes to me about the matter that he raises, I will look into it and contact the local authority in question.
    Bob Russell: Does the Minister agree that what is important is not just the provision of facilities, but access to them and whether young people in particular can afford to get into them? Does he agree that there is a need for joined-up government thinking with the Department for Education and Skills and local government to ensure that not only are facilities provided, but that young people can afford to use them?
    Mr. Caborn: Very much so. The hon. Gentleman knows that many local authorities—particularly Labour-controlled ones—are trying to ensure that the facilities are accessible, especially to people who can currently ill-afford to use them. I have seen many innovative schemes around the country. Using the modern technology that is available, such as the chips that can be put into passcards, we can distinguish between various categories of economic well-being among the populace in a city without it being seen as discriminatory. Many schemes are operating throughout the country, but he is right to say that, in some areas, financial barriers are preventing people

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    from gaining access to the facilities. I hope that local authorities and other partners can look at making that access available.

    Entertainment Licences
    Paul Farrelly: What plans she has to promote the use of live music in pubs and clubs by reducing the cost of entertainment licences. [107055]
    The Minister for Tourism, Film and Broadcasting (Dr. Kim Howells): The Licensing Bill will do away with the current system of separate, annually renewable and often very expensive public entertainment licences and establish a system under which a pub or club obtaining permission to sell alcohol will not pay anything extra to seek permission to provide live music.
    Paul Farrelly: I thank the Minister for his illuminating reply. I am sure that the House will welcome many of the changes that he has made to the Licensing Bill. May I say that he has carried them out with his usual grace, good humour and Pontypridd panache? However, he will know better than most the concerns that the Bill aroused; indeed, he still bears the scars. What steps has he taken since making those changes to reassure pubs, clubs, entertainers and the Musicians Union in particular that the Bill is both in their interest and the public interest?
    Dr. Howells: I had a meeting very recently with the new general secretary of the Musicians Union, Mr. John Smith, and I have met representatives of various folk group organisations, wassailers, folk dancers and even Somerset folk singers. We are determined that, between us, we will ensure that the licensed trade knows the potential of the new arrangements. I am convinced that we will see many more venues for live music in this country, not fewer, and that those that will put on live music will not have to suffer the distortions of the two-in-a-bar rule.
    Mr. Nick Hawkins: The Minister has already conceded in answer to his hon. Friend the Member for Newcastle-under-Lyme (Paul Farrelly) that the Government got the original proposals in the Licensing Bill catastrophically wrong. We are very pleased that the Government have now backed down, as his hon. Friend pointed out. Does he recognise the concerns of those of us in the all-party music group that further changes would still be welcome? Will he continue to listen to the proposals not only of the all-party group, but of all other organisations involved in Keep Music Live?
    Dr. Howells: It always amazes me that somebody can stand up in the Chamber and say that we have got something catastrophically wrong when, for 18 years, their Government put up with this nonsense and did absolutely nothing about it. We are determined that there will be a much better regime in this country for putting on live music and that we will see a renaissance of that music, which is a very important part of our economy. If we do not encourage the grass roots of music of whatever sort, I am not sure how the tall plants
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    will grow out of it. The entertainments industry is a very important part of our economy and we should never forget that.
    Mr. John Whittingdale: But is the Minister aware that, despite his assurances, more than 80,000 people have now signed the petition against the Bill and remain utterly convinced that it will result in the loss of thousands of venues for live music? Does he understand that he has completely failed to convince anybody as to why those venues should have to have an entertainments licence in future when they do not need one now and about why it is so necessary for pubs and clubs in England and Wales to be licensed when those in Scotland do not need a licence?
    Dr. Howells: I am sure that the hon. Gentleman knows that those venues do need licences now. If he does not know that, he should, because he has been told enough times. If he means that we should continue with the two-in-a-bar rule, despite the fact that it was the Musicians Union and musicians throughout the country who said that it was distorting live music in this country because it was not allowing musicians to explore anything beyond having two in a bar, which usually means one person with a karaoke machine, I am afraid that he will never grasp the reality of the situation. I would have thought that he would want to support something that will secure real improvement in this country in terms of the mounting and performance of live music.

    Public Libraries
    Joyce Quin: If she will make a statement on the implementation of the Government's policy of ensuring that all public libraries are online. [107056]
    The Minister for Sport (Mr. Richard Caborn): The £100 million lottery funding for the people's network programme has enabled 4,085 libraries in the UK to be connected to the internet, including all the libraries in my right hon. Friend's constituency. That represents 99 per cent. of libraries in England, 95 per cent. in Scotland, and 100 per cent. in Wales and Northern Ireland. Only 39 English and 30 Scottish libraries have still to be connected, and we expect all but two to be online by summer 2003. That is a significant achievement.
    Joyce Quin: Will my right hon. Friend congratulate Gateshead council on not only the people's network project but the lending time project? Does he agree that, taken together, they mean that not only is the policy of bringing libraries online being fully undertaken, but that the number of local people who can develop their computer skills and gain access to the facilities has greatly increased through work with volunteers? Is not that one of the many reasons why Newcastle/Gateshead would be an excellent capital of culture?
    Mr. Caborn: I could not possibly comment on my right hon. Friend's last question. Nevertheless, what is happening in Gateshead mirrors events throughout the country. Libraries are perceived, not in the traditional

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    sense as places where one can simply borrow books or go to read, but as true resource centres for developing the skills of my right hon. Friend's constituents and others. Many people are taking advantage of the £100 million investment and libraries have developed well beyond their service of simply lending books.

  The hon. Member for Middlesbrough, representing the
  Church Commissioners, was asked—

  CHURCH COMMISSIONERS

    Clergy (Conditions of Service)
    Mr. Ben Chapman: When he expects to receive proposals from the Archbishops Council on conditions of service for the clergy. [107082]
    Second Church Estates Commissioner (Mr. Stuart Bell): May I say at the outset how much I welcome the presence of the hon. Member for Gosport (Mr. Viggers) at our joint Question Time? I wish him well in his many endeavours in the weeks, months and years ahead.
    As my hon. Friend the Member for Wirral, South (Mr. Chapman) knows, the Archbishops Council has set up a working group under the chairmanship of Professor David McClean to review various matters relating to clergy terms of service, including the freehold and improving protection for clergy without it.
    Mr. Chapman: Given that the Archbishops Council has given the impression of substantial inactivity on conditions of service for the clergy since the Employment Relations Act 1999 was passed, and has appeared reluctant to set up the McClean committee—it did so late and slowly—would not it be a travesty if the workings of the committee were perceived as a reason for delay rather than a vehicle for progress, and if the contentious issue of the future of the freehold were to be used as a reason to delay granting conditions of service, which others have enjoyed for some years, to the clergy?
    Mr. Bell: I am aware of my hon. Friend's great interest in the subject and I respect and admire his persistence over the years since 1997 when he first became a Member of Parliament. I welcome the fact that he has an Adjournment debate on the subject in Westminster Hall.
    The working group's initial report will be made available to the Archbishops Council by the end of the year, and subsequent consultation will take place with the Church Commissioners. As my hon. Friend knows, the Church is anxious to co-operate with the appropriate Department, Professor David McClean and his committee.
    Mr. Gary Streeter: Should not those conditions of service include an express requirement for wisdom? How wise is it for the Archbishop of Canterbury to visit Qatar this week but to refuse to visit our troops, many of whom are laying down their lives for this country?
    Mr. Speaker: Order. The question is too wide.

  ELECTORAL COMMISSION COMMITTEE
  The hon. Member for Gosport, representing the Speaker's Committee on the Electoral Commission, was asked—
  ELECTORAL COMMISSION COMMITTEE

    Voting Age
    Mr Vernon Coaker: What representations the Electoral Commission has received on reducing the voting age to 16. [107083]
    Mr. Peter Viggers (representing the Speaker's Committee on the Electoral Commission): The votes at 16 campaign has made such representations to the Commission. It is also aware of support for moves to reduce the minimum voting age on the part of several parliamentarians, political parties and other bodies.
    Vernon Coaker: Will the hon. Gentleman try to ensure that, through the representations that it receives, the Electoral Commission tries to listen to the voices of young people on this issue? Those young people are asking why they can pay tax, get married and join the armed forces at 16, if they cannot vote.
    Mr. Viggers: Yes, indeed. The Commission is aware that there has been strong support expressed in some quarters that the voting age should be reduced. The purpose of the fundamental review that the Commission now has in hand is to gauge how wide that support is.
    Sir Patrick Cormack: Has my hon. Friend, whose presence answering questions I warmly welcome, received any even more stupid representations in regard to votes at 14?
    Mr. Viggers: Yes. [Laughter.] I say "yes" to acknowledge that I have heard the question. The Commission has put in hand a wide-ranging survey, which was announced on 27 February. Its timetable is to consult over the summer and early autumn of 2003, with publication of a final report, with recommendations, in early 2004. It is, perhaps, worth reporting, if one is seeking to improve the turnout at general elections, that the overall turnout in the 2001 general election was 59 per cent., but the estimated turnout among 18 to 24-year-olds was 39 per cent.

    Ward Boundaries
    Mr. Bill O'Brien: When the Electoral Commission last met the Boundary Commission to discuss the review of ward boundaries in metropolitan authorities; and if he will make a statement. [107084]
    Mr. Peter Viggers (representing the Speaker's Committee on the Electoral Commission: Responsibility for reviews of ward boundaries in metropolitan

    17
    authorities falls to the boundary committee for England. The Electoral Commission has not met the committee to discuss this matter.
    Mr. Bill O'Brien: May I draw the hon. Gentleman's attention to the guidance issued in the periodic electoral review, which states that the Electoral Commission and the boundary committee for England

    "must have regard to the desirability of fixing identifiable electoral area boundaries"

    and ensure that community interests are safeguarded? It is, therefore, apparent from the directive that both organisations have responsibility for this issue. I would like to draw the hon. Gentleman's attention to problems that are developing in some of the metropolitan areas in which boundary reviews are taking place. In Wakefield, for example, there are two communities with a vast distance between them. The M62 passes through the area, which also has a railway container depot and a vast industrial area, and a railway going along the division between the two communities. There is also no natural identifiable boundary. There has been a tremendous increase in community interest in this issue. Will the hon. Gentleman take this matter on board and ensure that such proposals will be examined in detail, and that the community interest is given priority when it comes to identifying ward boundaries?
    Mr. Viggers: Yes. Electoral equality is the starting point for the boundary committee's review, but of course it also takes account of other items, including community identity. As to the consultation on the boundary committee's draft recommendations in relation to Wakefield city council, the public consultation period ends today, and I understand that the hon. Gentleman is making representations in that regard.

    The hon. Member for Middlesbrough, representing the Church Commissioners, was asked—

    Church Repairs
    Miss Anne McIntosh: What assessment he has made of the impact that the revision of the sixth VAT directive will have on church repairs. [107085]
    Second Church Estates Commissioner (Mr. Stuart Bell): As the hon. Lady knows, I led a delegation to the European Parliament on the subject of the sixth VAT directive in December. I have since discussed the matter with representatives of the European Parliament. The Church knows that my right hon. Friend the Chancellor of the Exchequer and the Treasury are committed to achieving the changes required to the directive to enable a permanent reduction in the rate of VAT charged on the repair and maintenance of listed places of worship.
    Miss McIntosh: I am sure that the hon. Gentleman would agree that such a revision of the sixth VAT directive would have a very positive impact on church
    18
    repairs, but we seem to be no closer to achieving it. Will he put a deadline on when such a revision might be achieved?
    Mr. Bell: I am grateful to the hon. Lady for her persistent efforts in this area, and for keeping the issue on the boil. As she will be aware,

    "the mills of God grind slowly, yet they grind exceeding small".

    That might be equally true of the European Parliament in relation to the sixth VAT directive.
    Glenda Jackson: This is an issue of particular concern to members of one of the churches in my constituency, who have been extremely effective in raising money to repair its roof but are dependent on additional moneys. This issue, which seems to be making no advancement at all, is causing them grave concern. So far as my hon. Friend is aware, will the Government help such organisations to bridge the gap, if time is of the essence in tying up the additional funding that they might receive from other organisations?
    Mr. Bell: I am grateful to my hon. Friend for referring to a church in her constituency. As she is aware, the Chancellor reduced VAT on church repairs of listed buildings from 17.5 per cent. to 5 per cent. as a temporary measure. We are aware of and comforted by the fact that the Chancellor will continue that scheme until such time as the sixth VAT directive is passed. I will be grateful if my hon. Friend lets me know of any particular difficulties for her church in relation to those matters, and we will take them up personally.

    Pensions
    Bob Spink: Will he make a statement on pensions provision for the clergy. [107087]
    Second Church Estates Commissioner (Mr. Stuart Bell): Clergy in office receive a stipend and are housed. When they retire, they make their own housing provisions, but they receive a Church pension in addition to their state pension. The basis for determining the benefits provided by the Church—a lump sum at retirement plus a pension takes account of all those factors. The full service pension from 1 April 2003 is £11,013 per annum. The lump sum is £33,039.
    Bob Spink: What can the Church Commissioners do to reduce the proportion of retiring clergy who have to rely on means-tested state benefit and to improve pension provision for those clergy?
    Mr. Bell: I am not entirely sure what we can do about those who wish to retire early, as that, if I may say so, is their God given right. The hon. Gentleman will be aware that the clergy pension scheme is a defined benefit scheme. Many companies are switching to money purchase schemes that, in effect, switch risk to the employee. The Church has chosen not to do so, which highlights its commitment to adequate remuneration for retired clergy. We are also considering how we can increase the pensions for the clergy.

  ELECTORAL COMMISSION COMMITTEE
  The hon. Member for Gosport, representing the Speaker's Committee on the Electoral Commission, was asked—
  ELECTORAL COMMISSION COMMITTEE

    Experimental Voting
    Alistair Burt: What statutory measures allow experimental voting procedures in individual constituencies at general elections. [107088]
    Mr. Peter Viggers (representing the Speaker's Committee on the Electoral Commission): The statutory provisions for experimental voting procedures apply only to local authority elections in England, Scotland and Wales.
    Alistair Burt: A while ago, my hon. Friend referred to the number of younger people who vote. I and, I am sure, other colleagues have received representations from people of all ages asking for the opportunity to vote by e-mail or via the internet. Can the Speaker's Commission enable an experiment to see whether that would make a difference? It might allow the country to see whether those methods would work or whether more traditional ones are preferable.
    Mr. Viggers: I am grateful to my hon. Friend. This is indeed an area in which the Electoral Commission has a keen interest. The commission's strategic evaluation report on the May 2002 electoral pilots notes that voters generally found electronic voting systems easy and convenient to use. However, the commission also recognises that evidence in relation to turnout remains unconvincing and recommends further trials to build on the experience of this year's pilots, which, of course, will be held in relation to the May local government elections.

    The hon. Member for Middlesbrough, representing the Church Commissioners, was asked

    Fundraising
    Michael Fabricant: What advice is given by the commissioners regarding the use of Church premises for fundraising; and if he will make a statement. [107089]
    Second Church Estates Commissioner (Mr. Stuart Bell): The Church Commissioners give no such advice. Parishes make their own arrangements for fundraising events, and we applaud them for what they do. Many use their buildings for activities intended to raise funds, and well-planned events can benefit both the congregation and the wider community.
    Michael Fabricant: I am very grateful for that answer, and it is right to say that a variety of activities can take
    20
    place. May I again implore the hon. Gentleman to visit Lichfield to see not only activities such as the Lichfield festival, which occurs annually in our cathedral, but the many different churches, which raise money not only from jumble sales and bazaars, but through artistic events in the area?
    Mr. Bell: I am grateful for the question. If the hon. Gentleman remembers, at the previous Question Time, I accepted an invitation to visit Lichfield in July. When he sends me the invitation, I will be glad to accept it. Having said that, I was in mid-Wensleydale parish last week, in the constituency of the right hon. Member for Richmond, Yorks (Mr. Hague), and I must tell him that there was a strong response: all those in the room said that they had supported him, did support him, and would support him. I can only congratulate him on his role as a constituency Member of Parliament. At mid-Wendsleydale, a clear local connection existed between the parish church and the parish in relation to fundraising, which was very successful. The hon. Gentleman reminds us of how much work is done in parishes up and down the land in relation to fundraising and in relation to their parishioners.

  ELECTORAL COMMISSION COMMITTEE
  The hon. Member for Gosport, representing the Speaker's Committee on the Electoral Commission, was asked—
  ELECTORAL COMMISSION COMMITTEE

    Electoral Literature
    Simon Hughes: What monitoring of electoral literature the commission carries out. [107090]
    Mr. Peter Viggers (representing the Speaker's Committee on the Electoral Commission): The commission does not have a specific role in monitoring electoral literature, although it maintains an overview of the way that the law operates in that area.
    Simon Hughes: Given that all our constituencies and all the opinion polls show that the one thing that electors want from all parties in the House and elsewhere is more information that is, to use the words of the Advertising Standards Authority, "decent, honest and truthful", would it be helpful to the interests of the credibility of politics were the Electoral Commission to consider the issue and come forward with recommendations that we could all follow to public advantage?
    Mr. Viggers: I am not exactly certain what the hon. Gentleman is urging. If there is a breach of electoral law, it is a matter for the police prosecuting authority: it is not a matter in which the Electoral Commission becomes directly involved.

Iraq (Military Operations)
3.31 pm
The Secretary of State for Defence (Mr. Geoffrey Hoon): With permission, Mr. Speaker, 1 would like to make a further statement about military action in Iraq and the efforts that we are making to help the Iraqi people to rebuild their country.
Since my last statement on 3 April, coalition forces have continued to make excellent progress. Following a series of raids and patrols into the centre of the city, British forces have now deployed in force into Basra. United States Army and Marine Corps units have with remarkable speed advanced on Baghdad, seized the international airport and conducted patrols into the city centre.
Those military successes have not been without cost. On behalf of the Government, I extend our condolences to the families and friends of those three British servicemen who have lost their lives during the last few days and in the coalition campaign to date. I speak for this House, and for the people of this country, in paying tribute to the bravery and dedication of all British and American service personnel deployed in Iraq. It is through their efforts that we will end the threat posed by the Iraqi regime's weapons of mass destruction. The Iraqi people will soon be rid of Saddam Hussein, his barbaric regime and the suffering that he has visited on them.
Throughout this campaign, the coalition has sought to use minimum force to achieve our military objectives. We have never sought to inflict unnecessary suffering on Iraqi civilians, or, indeed, on members of the Iraqi armed forces. We have consistently encouraged members of the Iraqi armed forces to end their increasingly futile resistance and return to their homes and families. We are now beginning to see indications that these messages are having an impact, at least on some Iraqi soldiers. That does not mean, however, that the regime's resistance is necessarily at an end. In Basra, Baghdad and other urban areas, coalition forces will face a difficult and dangerous period dealing with the remnants of Iraq's forces. We owe it to our own forces and to the Iraqi people to proceed with care.
We took great care in the planning of recent operations in Basra: the aim was to remove remnants of the regime while minimising the risk to civilians and to our armed forces. For the last two weeks, 1 Division has consolidated its presence in and around Basra, carrying out patrols and raids deep into the city, undermining the grip of the regime and gathering the intelligence vital to developing the unfolding operation. Raids and patrols into Basra during Saturday night met with much less resistance from Iraqi forces than on previous days. The opportunity was therefore taken yesterday morning to launch a major operation to secure strategic positions deep within the city. That involved personnel from the Royal Scots Dragoon Guards, the 1st Battalion Irish Guards attached, the 1st Battalion Royal Regiment of Fusiliers, the 1st Battalion Black Watch, the 2nd Royal 'Tank Regiment and 3 Commando Brigade.
Significant progress has been made. We assess that coalition forces can now go to all parts of the city, albeit under the cover of armour. UK forces were warmly received by crowds of local people, demonstrating that
22
the coalition is winning the confidence and support of the Iraqi population. Power, water and food are now assessed to be available to the majority of the population. Key facilities are being secured by British forces in Basra, bringing much-needed security, safety and support.
In a very similar manner, the past few days have seen US forces make considerable progress in and around Baghdad, supported by coalition air and missile strikes which have degraded the regime's command and control capability and the Republican Guard's combat effectiveness. That strategy has worked remarkably well. The final 50 miles or so of the advance on Baghdad were completed at great speed. The US army's Fifth Corps defeated the republican guard's Medina division and seized Baghdad international airport on Friday. The first coalition aircraft landed at the airport yesterday. The First Marine Expeditionary Force overcame the Baghdad and al-Nida divisions of the republican guard in a matter of days, and is now on the south-east outskirts of Baghdad. US forces now control the major routes into and out of Baghdad.
Elsewhere, the men and women of the Royal Air Force continue to contribute significantly to the overall military campaign, providing close air support to US forces around Baghdad. Some 1,500 sorties have now been flown.
Our maritime forces, building on their early success on the al-Faw peninsula, and having created a safe channel for shipping into Umm Qasr, are now working hard to clear the whole Khawr Abd' Allah waterway of mines and obstructions. They are dealing not only with recent Iraqi mine-laying but with the legacy of the 1991 conflict. That is yet another example of coalition forces not only rebuilding Iraq for the future but improving on what was there before. Following the delivery by the Royal Fleet Auxiliary vessel Sir Galahad of 300 tonnes of food, water and other humanitarian assistance, RFA Sir Percival arrived this morning at Umm Qasr with a similar cargo.
The water pipeline constructed by the Royal Engineers is now delivering around 1.5 million litres of clean water a day and UK troops have delivered 170,000 sets of rations to people in south-eastern Iraq. While we should not underestimate the humanitarian problems that we face, we have not yet seen any indications that there are widespread shortages of food or water.
The United Nations security co-ordination department has declared Umm Qasr to be a "permissive" environment, an important step allowing UN agencies to begin operating there. In addition, the UN Office for the Co-ordination of Humanitarian Affairs has announced that the 24 grain silos at Umm Qasr port are safe and ready for use.
At a local level, significant steps are being taken to help the Iraqi people to begin to take control of their own affairs and to deal with decades of deprivation. UK forces have purchased shoes, stationery and books for children in Imman Anas. An Arabic computer has been purchased to enable the production of a news sheet for the civilian population of Az Zubayr. British officers have met with local people at Rumaylah to discuss future reconstruction projects—the renovation of the local primary school has already begun. Those

23
developments, together with the fact that we are seeing the reopening of shops and markets, represent at least the beginning of a return to normal life in southern Iraq.
The pace of events over the past few days has been remarkable, but it will take time for the Iraqi people to adjust to the rapidly changing circumstances. We should not underestimate the traumatic effect of living under such a brutal and venal regime for so many years, its terror and corruption devastating the lives of Iraqi citizens at every level. Just as it is taking time for the people of Iraq to come to terms with the fact that Saddam Hussein's regime is coming to its inevitable end, it will take time, after so many years of relentless propaganda, for them to begin to trust the good faith of the coalition. We must all be patient as there are many difficult and dangerous challenges lying ahead.
Mr. Bernard Jenkin: First, I associate the Opposition fully with the Secretary of State's comments about those of our servicemen who have given their lives during this conflict.
I join the Secretary of State in congratulating British and American forces on their spectacular progress both in Basra and in the attack on Baghdad over the past four days, capitalising on opportunities as they arise. The Secretary of State is right to be cautious about the future speed of events, even though the eventual outcome is not in doubt. I think of the evil King Balshazzar, who once ruled in that land and was slain. It is time that Saddam Hussein also saw the writing on the wall for his evil regime.
May I first ask about events around Basra? The Secretary of State makes no mention of 16 Air Assault Brigade; can he say anything about its role? There are also reports of increasing chaos and looting on the streets. The Secretary of State says that power, water and food are "assessed to be available", but is also clear that our armed forces' efforts to distribute food and water are severely limited because we simply do not have the manpower. I shall not press the right hon. Gentleman again on reinforcements, except to leave the issue on the table, and to note that the tasks for our troops are not getting any lighter, and that we are having to withdraw elements from front-line operations to give them rest. May I ask when he thinks that non-governmental aid organisations will feel able to join our troops' efforts to distribute aid? I note that the United Nations has declared Umm Qasr a "permissive environment"; so what is holding up NGO involvement? Is there sufficient port capacity to increase the flow of aid? When will Umm Qasr be open for the deep-water shipping on which the future flow of aid depends?
Turning to the question of post-conflict Iraq, in which the UK's armed forces will continue to play a significant role, can the Secretary of State clarify the Government's policy on the role of the United Nations? The Prime Minister has stated that the objective is for the occupying powers to return control to an interim Iraqi administration as soon as possible, and the United States clearly supports that view. However, what are the Government's plans for the pre-interim administration phase—referred to as the initial phase—which may last
24
as long as six months? Does the Secretary of State agree with the Secretary of State for International Development, who told the House last week that

"our armed forces are in Iraq as an occupying power … They do not, however, have the authority to re-organise institutions or establish a new Government. That requires a UN mandate"—[Official Report, 26 March 2003; Vol. 402. c. 277.]?

Will the Secretary of State for Defence explain what the Secretary of State for International Development means by "requires a UN mandate"? Although we would like the UN to play a role, surely the Geneva and The Hague conventions oblige the US and the UK not just to provide security and humanitarian relief, but to take the necessary steps to set up a transitional administration as quickly as possible.
Do the Government agree with the United States' National Security Adviser Condoleezza Rice that the pre-interim administration should be run by the US Office of Reconstruction and Humanitarian Assistance, under the leadership of retired US General Jay Garner? Will the Secretary of State confirm that there will be a substantial British role in this, and can he say what it will be? Ms Rice further said at a press briefing on 4 April:

"The precise role of the UN will be determined in consultation between the Iraqi people, coalition members and the UN officials … the coalition will naturally have the leading role for a period of time."

Does that reflect the view of Her Majesty's Government?
Following the conflict, the coalition will be responsible for the destruction of any weapons of mass destruction that are found. Will the Secretary of State make it clear—unlike his right hon. Friend the Home Secretary, on Saturday's BBC Radio 4 "Today" programme—that he does indeed hope to discover their whereabouts? Will he tell the House not what intelligence he may have, but simply answer this question: does he have fresh intelligence on the whereabouts of Saddam Hussein's weapons of mass destruction? Is it possible that weapons of mass destruction have been moved out of Iraq?
May I make it clear to the Secretary of State that the liberation of Iraq is a noble cause, but that the elimination of Saddam Hussein's weapons of mass destruction is the prime objective, and we will hold the Government to that task until it has been achieved?
Mr. Hoon: I thank the hon. Gentleman for his comments and in particular for his congratulations to UK and US armed forces, who have worked tremendously well together throughout this conflict, and who continue to do so. As far as 16 Air Assault Brigade is concerned, it is using its very considerable abilities and mobility to support other forces, and in order to be the key—especially in the operation to the north of Basra—to cutting off contact between Basra and other parts of Iraq.
The hon. Gentleman referred to looting, and I know that right hon. and hon. Members will be concerned about that issue; indeed, I have sought to identify the extent of it. Fortunately, it appears so far to be confined to Iraqi citizens—shall I use the word—"liberating" those items that are in the charge of the regime by entering its former facilities and the secret organisations, and redistributing that wealth among the

25
Iraqi people. I regard such behaviour as good practice, perhaps, but that is not to say that we should not guard against more widespread civil disturbances.
As far as power and water are concerned, I referred to British forces securing key facilities in Basra. That was specifically directed at locations that provide water and electricity. Until Saturday and Sunday, we were in no position to identify whether water shortages, probably the result of power outages, were capable of being repaired because we did not control that part of the city. Now that we do, we can take matters in hand to secure a more reliable electricity supply and, thereby, a supply of pure fresh water.
NGOs are beginning to enter the south of Iraq. Obviously, the more parts of the country are safe and secure, the more it will be possible for those NGOs to use their considerable ability to distribute food and other humanitarian assistance. That also depends on port capacity, and urgent efforts are being made both to widen the channel into Umm Qasr and to make more berths available in the port. For the moment, however, it is judged that there are some limitations on what can be achieved because of the continued threat from mines.
As to the role of the United Nations, we certainly want to see UN authority for operations in Iraq, but, equally and as quickly as it can be achieved, we ultimately want the Iraqi people to take responsibility for their own affairs, to take their own decisions and to engage in a form of representative government. That was set out clearly by the Government at the start of the military campaign, and it remains fundamental to our objectives.
The Office for Reconstruction and Humanitarian Assistance will certainly be responsible in the early period for the distribution of humanitarian assistance, of which the United States has amassed a considerable stockpile, as well as for the early administration of areas freed from the Iraqi regime. It is common ground and shared between all members of the coalition that we want to see the ORHA move on quickly to allow an interim Iraqi Administration, which will lead to the Iraqis taking responsibility for their own affairs. That is what we are trying to achieve, and British participation in that process will he considerable, not least through the efforts of Brigadier Cross, who will be familiar to many hon. Members after his excellent work in the Balkans.
The destruction of weapons of mass destruction continues to be our priority. We are continuing to search the areas that have been freed, but our first priority must be an end—a successful end—to the military conflict. Thereafter, we will certainly pursue the location of weapons of mass destruction.
Mr. Paul Keetch: I thank the Secretary of State for advance notice of his statement today. I also welcome his attendance in the House, which has been assiduous, and I am sure that hon. Members on both sides of the House are grateful for that during the current crisis. I also want to pay tribute to the men and women of our armed forces as they continue to do their difficult job in Basra and the surrounding areas. I also add my condolences to the families of all members of coalition forces who have been killed so far. I should also like to remember the Iraqi civilians who are caught up in the fighting. As the Secretary of State rightly said, we have no argument with them.
26
By all accounts the people of Basra have welcomed British forces into their midst, but I want to ask more about the looting to which the Secretary of State has already referred. There are appalling suggestions from some elements of the media that British troops may have condoned such action. Can the Secretary of State confirm that we have not done so, other than the understandable "liberation"—as he put it—of food stocks, and that we will endeavour to keep order in the parts of the country that we are liberating? As part of that process, what troops have been earmarked for peacekeeping operations in Iraq in the near future: have they been placed on standby, ready to go?
On weapons of mass destruction, there have been conflicting reports today that chemical agents may have been found. The Government's own military objectives recognise that UNMOVIC and the International Atomic Energy Agency will have a role in dismantling these weapons, should they be found. Is that still the case? Were the missiles that fell on Kuwait at the beginning of the conflict Scud missiles or al-Samoud missiles? Will he comment on the role—or, rather, the lack of role—of the Iraqi air force during the conflict?
Incidents of friendly fire have come to the fore, and I am sure that all hon. Members regret that. However, I have been approached by some of the relatives, as other colleagues will have been. Will the Secretary of State confirm that the US Defence Department refused to allow its combat soldiers to give evidence at British inquests into friendly fire incidents in the first Gulf war? Has agreement been reached in this conflict that all coalition forces will co-operate if there are to be inquests or inquiries in the UK or the United States? Finally, the thoughts of all hon. Members go out to our British men and women who are continuing the campaign in Basra; they are a credit to the whole nation.
Mr. Hoon: I am grateful for the hon. Gentleman's observations about the role of British forces, and for his emphasis, which I share, on the fact that we have no argument with the Iraqi people. As I have said, British forces will keep control to avoid unnecessary looting, but they have not been specifically earmarked for peacekeeping operations. The House will be aware that British forces tend to see their role in offensive terms, when that is necessary, as well as conducting peacekeeping immediately thereafter. We are seeing British forces at their very best in providing both that offensive role in and around Basra and a peacekeeping role further south.
On chemical agents, some interesting findings are being investigated on which I will be able to report to the House in due course. I am not yet in a position to confirm that the missiles that fell on Kuwait were of a particular kind, although I can say that they did not travel in excess of the distance allowed under previous UN resolutions. I think it is fair to say that the Iraqi air force was confined to ground operations.
There will be inquests in due course.
David Winnick: Is it not the case that if we had listened to the critics, there would be no purpose in debating post-Saddam Iraq, since that tyranny would have lasted for years and years and, in time, that murderous dictator would have been

27
succeeded by one of his sons, no less murderous and thuggish? Would it not be wise for those criminal elements of the elite forces fighting the coalition armies to realise that if they do not surrender, they will be killed either by our troops or, given half a chance, by the Iraqi people themselves?
Mr. Hoon: I have long admired my hon. Friend's consistency and steadfastness on the issue, and he has been a pillar of support throughout.
Mr. Paul Goodman: In relation to the future government of Iraq, the Secretary of State for Wales said at the weekend:

"What is crucial is that the UN is put in charge after the interim transitional arrangements. That is vital to us and the whole of the European Union."

Is that the Government's view?
Mr. Hoon: I have made it clear that we want to see UN authority; that is a view shared between the United States and the United Kingdom. It is wholly consistent with the way in which previous peacekeeping operations have been conducted, such as in Afghanistan.
Mr. Ben Chapman: While pockets of agents loyal to the regime continue, and will continue, to provide resistance to coalition troops, the one cohesive mechanism that the Saddam regime seems to possess right across Iraq is the continued control of Iraqi state radio and television. What is our planning in relation to the seizure of mobile transmitters and fixed facilities, and in relation to increasing our broadcasts in Iraq so that we can bring this action to a speedier conclusion?
Mr. Hoon: Although coalition forces have not specifically and directly targeted the media as such in Iraq, my hon. Friend is certainly right to draw attention to the means whereby the regime has sought to disseminate information through broadcasting. In fact, other targets—often co-located with radio and television transmitters—have been addressed, especially those that have provided the regime with command-and-control facilities. The level of broadcasting has been significantly reduced. I anticipate that, today, little broadcasting actually takes place that reaches many people in Iraq.
Mr. Andrew Robathan: The enthusiasm with which it appears that British troops have been greeted in Basra goes some way towards vindicating those of us who believe that we are liberating Iraq, and I very much hope that it continues. However, can the Secretary of State tell us what use is being made of Iraqi exile groups both in assisting with the liberation of Iraq and in perhaps laying the groundwork for some form of democratic government in the future of Iraq?
Mr. Hoon: The hon. Gentleman is right to draw attention to the growing enthusiasm in Basra. As I have previously indicated to the House, it depended on people there having confidence and believing that coalition forces were there to stay, and would see the job through and remove those elements of the regime. I have
28
certainly given them that assurance. The growing presence of Iraqi exiles to assist in that process, not leas(by going into towns and villages and explaining what is taking place, is of enormous value. That is beginning to happen.
Mr. Neil Gerrard: Will the Secretary of State confirm whether searches have yet taken place of specific sites identified by US or UK intelligence as possibly containing weapons of mass destruction? Does he share the view that appears to have been expressed at the weekend by one of his Cabinet colleagues that it is possible that nothing will be found?
Mr. Hoon: I do not share that view. Searches are under way and obvious sites have been looked at. We have been aware for some time that the regime had removed many of the more obvious elements of its weapons of mass destruction and had sought to hide them in the more remote parts of the country as well as to keep them mobile. I have no doubt that those weapons of mass destruction will he found.
Sir Teddy Taylor: Would it not assist the armed forces in the difficult task that they face, and achieve more co-operation locally, if the Secretary of State and his United States colleague made it abundantly clear that they do not contemplate further military action of any kind against any other nation in the middle east?
Mr. Hoon: I am not aware of any such contemplation. Indeed, we have made it plain that action against Iraq was unique, not least because of Iraq's very, very long history of flouting the will of the international community and United Nations Security Council resolutions.
Mr. Tom Harris: Can my right hon. Friend give more details about the situation in Basra? The media tend to give a mixed picture: on one day, they say that British troops are entering and occupying Basra, while on the next, they say that we have experienced strong Iraqi resistance. Can my right hon. Friend give an overview of the different levels of security in Basra and tell us what coalition troops are actually doing to encourage security, and confidence in coalition troops in the city?
Mr. Hoon: My hon. Friend makes an excellent observation. There are inevitably different levels of security, especially in this kind of conflict. I made it clear that the ground commanders of British forces going into Basra feel confident so far that they can go to any part of the city, provided that they are protected by appropriate armoured vehicles. The next stage is to be confident that they are sufficiently secure to conduct foot patrols. Thereafter, we may see them conducting foot patrols without helmets, perhaps patrolling with berets, as we have seen them do in other towns and cities in southern Iraq. It is a progressive effort, to build up the level of security for our forces; but my hon. Friend is right to draw attention to the different degrees of security and the efforts being made by British forces to build on them.
Mr. Boris Johnson: Given the attention that people who oppose the war and the liberation of the

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Iraqi people are increasingly drawing to the failure so far to find weapons of mass destruction, can the Secretary of State clear up a question that I am increasingly asked—as, perhaps, are other Members? To what extent does the legality of the operation depend on our finding these weapons, and might it retrospectively be deemed illegal if we fail to find them?
Mr. Hoon: As I have made clear, we will find weapons of mass destruction.
Angela Eagle: Will my right hon. Friend accept everybody's gratitude and admiration for the extremely professional way in which our armed forces have achieved their objectives to date? Does he also accept that none of us should be complacent about the end of the conflict, although it looks as though we may be approaching the end game? Can he say something about the likely period within which the oil-for-food programme that the UN voted to restart under the auspices of the Secretary-General could be put back into effect in those areas that have been liberated from Saddam's regime?
Mr. Hoon: I am grateful for my hon. Friend's observations. She is right to be cautious, as I sought to be in my statement. A great deal of work still remains to be done to remove the continuing remnants of Saddam Hussein's regime. That work may well prove difficult and dangerous, so she is right to strike that appropriate note of caution.
As for the oil-for-food programme, the first stage—the renewal of the appropriate resolution—has been completed and is now in place. That will allow the release of some of the funds built up in trust, which can then be used to continue the previous efforts made to extend the benefit of the oil-for-food programme to the Iraqi people. Ultimately, and as quickly as possible, we want oil to be pumped again, not least from the oilfields in the south of Iraq for which we are responsible, in order to build up the wealth available for the people of Iraq. There is no reason why that should not happen quite quickly.
Mr. Elfyn Llwyd: The Secretary of State referred to the use of minimum force and the need to minimise Iraqi civilian casualties. Does riot the continued use of cluster bombs make that more difficult, and in due course will it not make the huge task of reconstruction much more difficult and dangerous?
Mr. Hoon: As I have said on previous occasions when that issue has arisen, the use of all weapons involves striking a balance. All weapons are capable of damaging the civilian population as well as those against whom they are targeted. It is necessary to strike a balance between not only the risk to civilians, but equally the protection of coalition forces. In relation to the use of cluster bombs, I am confident that the right balance has been struck.
Colin Burgon: What assessment has the Secretary of State made of the residual strength of the Ba'ath party and the level of support that it will command? In particular, what are the implications for any future democratic regime or Government in Iraq?
Mr. Hoon: Some work is currently under way on that. It is a very difficult question to answer at this stage, not
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least because the only way of assuring success in Saddam Hussein's Iraq was to be a member of the Ba'ath party and to operate under his rule. On the other hand, there may well be decent people who had no part in the excesses of the regime and who will, in turn, return to rebuild their country. I suspect that it will depend on their ability to persuade people in their own areas that they have not been involved with the regime and that they can therefore he relied on and trusted.
Mr. Andrew Mitchell: In his most welcome statement, the Secretary of State paid tribute to the successes of our armed forces. Is it not particularly noteworthy that as well as being highly effective at prosecuting the war, they have already shown themselves to be extremely skilled at peacekeeping; and should we not note the experience that they have already brought to bear in. for example, differentiating between paramilitaries and civilians?
Mr. Hoon: The hon. Gentleman is right. As I said a few moments ago, it is a particular characteristic of Britain's armed forces that they can move very quickly from intense war-fighting to—if I can put it this way—intense peacekeeping. Not least because of their long years of experience in Northern Ireland, they are well used to mixing in with the local population, talking to people on the ground and treating people with the respect to which they are entitled after a conflict has come to an end. That is why they are already proving so successful in southern Iraq, and I anticipate that they will continue to be so.
Kate Hoey: Despite what the Secretary of State said earlier, how does he possibly think that we can win over the hearts and minds of Iraqi civilians by using cluster bombs?
Mr. Hoon: No one is suggesting that we win over the hearts and minds of Iraqi civilians by using cluster bombs other than in this sense: it is necessary to succeed in the military conflict in order to win over those hearts and minds. We will not succeed in the military conflict if we prevent our armed forces from protecting themselves when they are confronted by a determined and often ruthless opposition. I invite my hon. Friend to weigh that in the balance. Is she really prepared to put the lives of our forces at risk in order to prolong the conflict, and thereby make it more difficult, in the longer term, to win the hearts and minds necessary to rebuild Iraq?
Mr. Peter Viggers: Does the right hon. Gentleman share our respect for those who have expressed hesitation about and, indeed, opposition to the armed conflict? No one wanted the war, hard decisions had to be taken and we must respect those who expressed their opposition. Based on briefings at the United Nations two weeks ago and on meetings of the NATO Parliamentary Assembly over the weekend, two things are clear. First, our armed forces have won a new reputation for courage and skill, which is based, as the right hon. Gentleman said, on their experience in Northern Ireland. Their international standing has never been higher. Secondly—we should all unite

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behind this point—the armed conflict should be brought to a conclusion as quickly as possible so that we can move on to peacekeeping.
Mr. Hoon: I am grateful for the hon. Gentleman's observations about the skill of Britain's armed forces, but I would not want him to overlook the remarkable skill at arms that has been displayed by US forces. I anticipate that their advance from the south of Iraq to Baghdad will be lectured on for years to come in staff colleges throughout the world. I am told by those who know, that it is one of the most remarkable armoured advances ever seen in modern warfare.
I agree with the hon. Gentleman's second point. It is necessary to try to bring the conflict to a speedy conclusion, and that has always been our ambition. At the same time, consistent with observations of right hon. and hon. Members on these occasions, it is necessary to do so in a cautious and practical way while minimising risk to Iraqi civilians and safeguarding our forces. The operation in and around Basra that has been conducted by British forces is absolutely characteristic of that approach.
Mr. Win Griffiths: While welcoming very much the military successes in Basra and Baghdad reported by the Secretary of State, will he tell us a little more about the conflict elsewhere? Will he confirm reports that I have received from the National Council of Resistance of Iran, which I reported to his private office late on Friday afternoon and this morning, about four bombing raids on the military camps of the People's Mujaheddin of Iran? The group is dedicated to overthrowing the Iranian Government and notified the Secretary of State for Foreign and Commonwealth Affairs in writing, through the foreign affairs chairman of the National Council of Resistance of Iran, that it would not get involved in the war at all. Why were the four raids carried out, during which three women were killed and four were wounded, and what evidence do we have about them?
Mr. Hoon: I thank my hon. Friend for the assistance that he has provided and I assure him that his observations have been followed up. The border areas, especially where Iraq shares a border with Iran, contain groups with shifting alliances, if I may put it that way. Some groups are regarded as terrorists, depending on the side of the border from which they operate. I assure my hon. Friend that we have regard to the different alliances as we prosecute the campaign.
Mr. Jonathan Djanogly: The Secretary of State spoke of the need for Iraqis to take control of their own affairs as soon as possible, and I am sure that everyone agrees with that. However, there is a timing issue. Do the Government feel that the opposition parties that exist, plus the exiles to whom my hon. Friend the Member for Blaby (Mr. Robathan) referred, form a cohesive unit that is ready to be put into play to form a Government? If not, what are this Government doing to ensure that that will happen?
Mr. Hoon: The hon. Gentleman quite rightly sets out the principle that we want the Iraqi people to take
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control of their own affairs. Equally rightly, he points out one of a number of difficulties that we face—that of establishing a degree of cohesion between exiled groups and opposition groups inside Iraq. Because of the pervasiveness of the oppression conducted by Saddam Hussein's regime, it has been extremely difficult to find effective opposition groups. Opposition was stamped down on very hard by the regime. One of our challenges will be to find the necessary cohesion between exiled groups—who, as I said earlier, will come back into the country—and groups who have sought to oppose the regime from within Iraq. That will be a challenge.
Mrs. Alice Mahon: It has been reported that tanker drivers are collecting water from the military in the areas that we control and then selling it to a thirsty population. If that is true, does the Secretary of State agree that it is hardly the way to win hearts and minds, and will he look into the matter and get it stopped?
Mr. Hoon: There was an isolated account of that taking place and action was taken by British forces to deal with it.
Hugh Robertson: The Secretary of State may have seen the interview on television last night with a couple of Arab fighters from southern Lebanon, who I presume were from Hezbollah. Does the Secretary of State have a feeling for how large a problem that involvement now is in Iraq? What part does he feel such people might play in the battle for Baghdad?
Mr. Hoon: As I said in response to questions last Thursday, people have been willing to come into Iraq and offer themselves for various operations. We are addressing that issue, which we take seriously. However, I hope that, as the regime shows signs of collapse right across Iraq, we will be able to deal with the issue effectively.
Mr. Gordon Prentice: I want to return to the issue of high-level defections from the Iraqi military. How many approaches have been made to the United Kingdom Government and what inducements, if any, are being offered to those senior military people to encourage them to defect?
Mr. Hoon: For at least some of the senior figures to whom my hon. Friend refers, I suspect that survival is the most important inducement. We are pleased that some people have recognised that it is rather better to surrender than to continue to risk their own lives and the lives of those under their command. Obviously, we have to pursue such matters carefully and it has been extraordinarily difficult on this occasion. I know that some commentators were expecting widespread surrenders; however, over and over again we have heard that, although commanders in the field might be willing to surrender, they have not done so out of fear of what would happen to their families or their children back home, wherever they happen to live.
David Burnside: The Secretary of State will know that, in the next couple of hours, Air Force One will touch down in my constituency,

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conveying the President to Hillsborough to join the Prime Minister in pursuing the successful conclusion of the conflict in the Gulf and then the start of the task of reconstructing Iraq. That is the important item on the agenda. However, the Secretary of State will also know that there will be a break in the proceedings tomorrow morning for a less important, although not unimportant, item, when the President and the Prime Minister will meet the Northern Ireland political parties. Will the Prime Minister convey the strong feeling of this House and the British people that we need the destruction of all the weapons that have killed and hurt people in Ireland? When the President and the Prime Minister meet the parties tomorrow morning, will they send out the message that we want an end to terrorism worldwide, including terrorism in Ireland?
Mr. Hoon: I am flattered that the hon. Gentleman is here rather than greeting the President of the United States in his constituency. He is right to suggest that we need to make progress, working with the United States, on a range of issues. We will not only be continuing the peace process in Northern Ireland, but holding important discussions on the middle east peace process and, obviously, on the military situation in Iraq. My right hon. Friend the Prime Minister and the President of the United States will have a full agenda. High on that agenda will be the destruction of weapons wherever they are.
Glenda Jackson: If we do indeed owe a duty of care to the Iraqi people, how is it possible that we can still contemplate the use of cluster bombs, as it is well known that the greatest number of deaths and injuries are experienced by civilians from the hundreds of unexploded bomblets that lie around on the ground? What steps are being taken to ensure that civilians may not enter the areas where those bombs have been used before the bomblets can be removed or exploded?
Mr. Hoon: I have dealt with the general question on a number of occasions, so I will not repeat that again, but, on the specific point, careful note has been taken of where and when cluster bombs have been used and, as I have indicated to the House before, the people who most often risk their lives in dealing with the small failure rate of those weapons are members of Britain's armed forces.
Bob Russell: I thank the Secretary of State for his recent visit to Colchester garrison to meet the wives and other dependants there. That visit was very much appreciated. He rightly drew attention to the pride that we have in our armed forces and the way that they have performed in Iraq; in particular, I should like to draw attention to 16 Air Assault Brigade. However, does the Secretary of State agree that things are far from being over, and we must impress on the public the need for caution because there is a long way to go yet? With that in mind, does he have any plan to make an announcement about the possible replacement of those troops who are currently there?
Mr. Hoon: I thank the hon. Gentleman for welcoming me to Colchester to participate in an excellent meeting with the families of those in 16 Air Assault Brigade
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based there. It was a remarkable occasion because it demonstrated the debt that we owe not only to members of the armed forces, but to their families. I was profoundly impressed by the support that they were able to give not only to their men, but to the country in its efforts. As for making sure that we go on providing that support and in respect of any replacements, I told the House last week that we will replace certain units, particularly those that have been in theatre for some months now, as and when necessary, but I shall not make any specific announcement at this stage. Some units will be rotated as a matter of routine, but there is certainly no need at this stage to complete any major reinforcement of our forces there.
Several hon. Members rose
Mr. Speaker: Order. I ask for the co-operation of the House. I can call every Member standing, provided that each Member asks one question and makes it as brief as possible.
Mr. Tam Dalyell: Have officials at the Ministry of Defence brought to the Secretary of State's attention the work of a brave former Member of the House? I refer to Colonel Colin Mitchell and his work at the Halo Trust, and to the sheer difficulty of retrieving cluster bombs.
Mr. Hoon: I am well aware of the work of the Halo Trust. Indeed, it is an organisation with which the Ministry of Defence has worked—supplying equipment and providing advice and expertise—and I strongly support the efforts that that organisation has made.
Mr. Edward Leigh: Does the Secretary of State recall that as long ago as 1992, the Public Accounts Committee said that the Ministry of Defence should redouble its efforts in dealing with friendly fire? We now have a policy paper a decade later. Will he confirm whether it is true that all US vehicles in theatre are fitted with transponders that can respond to a threat of friendly fire, while UK vehicles merely have symbols, chevrons and the like? Is the problem foot-dragging in NATO? Will he put sufficient, commensurate resources into dealing with that problem as well as into developing high-technology weapons?
Mr. Hoon: I am sorry that the hon. Gentleman continues to suggest that there is a technological solution to the problem of friendly fire. No one underestimates the tragedy of such incidents and, as we have seen in recent days, they are not solely confined to confusion between the forces of different nations. Very recent incidents demonstrate that those problems are also not solely confined to British military vehicles operating on the ground. It would be enormously helpful if he turned his mind to the wider problem of friendly fire and got away from the idea that there is a single technological solution. Indeed, I commend to him an article in The Times today in which Wesley Clark makes that point very strongly, as a very experienced senior military commander. If the hon. Gentleman would understand that, he would be able to see that the problem is much more difficult than simple technology can solve.
Mr. Gerald Kaufman: Will my right hon. Friend bear in mind that those of us who

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support the Government and our servicemen with our voices and our votes do not believe that our servicemen are risking, and in some cases losing, their lives so that post-war Iraq can become the fiefdom of the right wing of the United States Republican party and the reconstruction of Iraq can be the playground of American corporate capitalism? Will he also bear in mind that we look to our Prime Minister to push forward the peace process between the Israelis and the Palestinians, regardless of any obstruction from the Israeli Government?
Mr. Hoon: As I am sure my right hon. Friend knows, my right hon. Friend the Prime Minister and the President of the United States will have a full agenda for their talks this evening and tomorrow. They will certainly consider the best and most effective means of restoring Iraq to its own people and of renewing the peace process in the middle east, while also giving thought to the need to reinstate the effective peace process in Northern Ireland. I am delighted that the United States President has come to the United Kingdom for that purpose.
Mr. Gary Streeter: I join the Secretary of State in praising the professionalism, skill and courage of all our armed forces during the liberation of Basra, which we have witnessed in the past few days. As he will understand, the west country is particularly proud of the role played by the Royal Marines, who have been at the forefront of that activity.
Has any evidence emerged of recent sanction-breaking by French or Russian defence companies, and of any munitions that they may have sold to Iraq in recent years? If so, what does the Secretary of State propose to do about it?
Mr. Hoon: I, too, pay tribute to the Royal Marines, who have done a tremendous job in doing all that we have asked of them in and around Iraq. I am not in a position to comment on possible breaches of any sanctions at this stage, but we continue to look at that carefully.
Mike Gapes: My right hon. Friend rightly mentioned the role of the British forces in liberating Basra, and that of the American coalition allies in beginning the liberation of Baghdad. He did not, however, mention the important role in the coalition of the Iraqi Kurdish forces—the peshmerga, who are, after all, Sunni Muslims—in liberating large swathes of northern Iraq from which the Kurdish people were ethnically cleansed by Saddam's regime. Does he agree that the carping critics should remember that the Kurdish forces are there and able to do this only because our no-fly zone has made their existence possible?
Mr. Hoon: My hon. Friend is right to draw attention to the close co-operation between American military forces and Kurdish forces in the north. They continue to work extremely effectively together, and I am sure that my hon. Friend's observations about their efforts to re-establish themselves in their traditional areas are entirely right.
Joan Ruddock: I echo the tributes and the condolences, but I must press my right
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hon. Friend again on the question of cluster bombs. As he will know, the manufacturers accept a 5 per cent. failure rate, but in the battlefield it is likely to be many times that. As my right hon. Friend says, it is sometimes the forces' duty to clear up afterwards, but for many years subsequently that tends to be the job of the international community and aid agencies such as Landmine Action. Will the British Government pay for the non-governmental organisations that will do the work when the conflict is over?
Mr. Hoon: I have had regular contact with various NGOs that are engaged in this extremely important, demanding and often dangerous work. The Ministry of Defence has been able both to discuss with them the most effective means of dealing with unexploded ordnance and, from time to time, to supply appropriate equipment. I assure my hon. Friend that that will continue.
Mr. Shaun Woodward: I am sure that all hon. Members were horrified at the weekend by the pictures of the warehouse with over 200 coffins containing human remains. Reports suggest that those may well be the remains of Iranian prisoners of war. Given the catalogue of war crimes by the Saddam regime during that war, the first Gulf war and almost certainly the present Gulf war, what priority will be given to hunting clown those who committed war crimes, and under what jurisdiction will they be prosecuted and tried?
Mr. Hoon: Whatever took place in that warehouse was horrific, and it is necessary for us to identify the explanation. One plausible explanation may be, as my hon. Friend suggests, that they were prisoners from the Iran-Iraq war. There are other possible explanations as well. A British Army investigation team began work today to try to identify at least some of the explanations for those horrendous discoveries. If it is found that individuals are responsible, they will be arrested and dealt with in an appropriate way.
Harry Cohen: Does the Defence Secretary agree with what the International Development Secretary said on "Newsnight" last week—that until it is safe for aid agency operatives to work in Iraq, humanitarian aid is solely the responsibility of the military? If so, how is the medical aid to get to the hospitals, how is sustenance to get to the people, and how is law and order to be maintained? Is it all to be done by tank? If so, for how long?
Mr. Hoon: My right hon. Friend the Secretary of State for International Development and my hon. Friend the Member for Leyton and Wanstead (Harry Cohen) are right to draw attention to the responsibility of the armed forces for providing humanitarian support in the immediate period after a conflict. I am delighted at the excellent co-operation that exists between my right hon. Friend's Department and mine in that respect. The sums of money that I indicated were available for humanitarian action to be carried out by the armed forces when I made a statement on Thursday is part of that process. We are all working towards a situation in which non-governmental organisations—

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the United Nations and others—can come in. That is why I regard it as so important that the United Nations has declared Umm Qasr a permissive environment. That is because the UN judges that it is now possible for the UN and other organisations to come in and begin the process of distributing aid. I assure my hon. Friend that the British Army and other members of the armed forces of the United Kingdom have an excellent record of delivering humanitarian assistance. They use their own doctors to provide medical assistance to the people on the ground, and they will provide a range of support and facilities in delivering humanitarian aid. Clearly, we want to see NGOs come in and continue that work, but h e should not underestimate the ability of our armed forces to do it.
Dr. Nick Palmer: Does my right hon. Friend agree that in view of the manic-depressive nature of media coverage of the war, we risk seeing within 48 hours headlines saying, "Coalition bogged down again"? Do not most hon. Members, on both sides of the House, want the coalition to proceed at the appropriate pace to minimise losses to our own armed forces, losses to Iraqi civilians, and even casualties to Iraqi armed forces, so that we can end the war with the least long-term damage?
Mr. Hoon: My hon. Friend is right. The word that I used at the end of my statement, which I think encapsulates what he describes, is "patience". We need to approach the matter in an appropriate, patient manner. I shall resist any temptation to criticise the media, because I find that they are remarkably sensitive to such criticism. They tend to react very strongly when we criticise them, although they routinely criticise us.
Ms Diane Abbott: With reference to an earlier question, is it true that at inquests into friendly fire incidents held after the first Gulf war, US soldiers refused to give evidence? Can my right hon. Friend assure the House that if inquests are held into friendly fire incidents after the present war, all coalition soldiers will give evidence, as appropriate?
Mr. Hoon: We are already examining some of the jurisdictional issues arising out of friendly fire incidents. They are not easy, as I suspect my hon. Friend's question indicates. The matter is something that I can come back to the House in due course and explain.
Huw Irranca-Davies: My right hon. Friend referred earlier to when the textbooks would be written after the war. Does he agree that one of the lessons written in those textbooks will be the way in which troops, often in conditions where they are under fire and in conflict, have carried out humanitarian and regeneration works? Will he also confirm that in reconstruction of the water and electricity supply to Basra, it is the intention of the coalition and any interim administration to extend water and electricity to the whole population and not just to the part of it that previously received them?
Mr. Hoon: My hon. Friend is quite right. Indeed, as I said in my statement, our ambition is to improve the
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situation that was, in effect, inherited by British forces. Equally, we want to ensure that other organisations—NGOs, the United Nations and the like—come in and play their part. Certainly, we believe that we can improve the level of assistance for people in southern Iraq over and above that which was made available to them by the regime.
Mr. John Smith: I thank my right hon. Friend for today's statement. We can all be extremely proud of the way in which British forces are conducting themselves in this war. Will he join me in paying tribute to the role played by Group Captain Lockwood, who has effectively become the highly respected and reasoned voice of British services in the Gulf? Finally, on a technical point, will he confirm that it is now possible to send 2 kg packages to British service personnel in Iraq by BFPO and free of charge?
Mr. Hoon: I am sure that the group captain would not want to be picked out from the very many people who are working extremely hard in Britain's forces, but I shall ensure that a copy of my hon. Friend's observations reach him. On the point about the packages, the new arrangements are not yet in place, but I shall certainly inform the House as soon as they are.
John Cryer: Further to two earlier questions asked from both sides of the House, my right hon. Friend is fully aware that comments have been made by certain American leaders in the past couple of weeks to the effect that the war could be widened to Syria and Iran. Will he take this opportunity to tell us about any discussions that he has had about the matter with the Washington regime? Will he make it absolutely clear that the British Government will have no part in this lunacy?
Mr. Hoon: I have had no such discussions with the democratically elected Administration in the United States, and as I have made clear, the campaign that is being conducted against Iraq is a unique campaign based on that country's failure to observe UN resolutions over a very long period.

DELEGATED LEGISLATION
Mr. Deputy Speaker (Sir Michael Lord): Perhaps it would be for the convenience of the House to take motions 1 to 5 together.
Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6)(Standing Committees on Delegated Legislation),

DELEGATED LEGISLATION
  TRADE UNION AND LABOUR RELATIONS
  That the Advisory, Conciliation and Arbitration Service draft Code of Practice on Time Off for Trade Union Duties and Activities, which was laid before this House on 10th February, be approved.
  NORTHERN IRELAND
  That the draft Local Elections (Northern Ireland) (Amendment) Order 2003, which was laid before this House on 31st March, be approved.
  AGRICULTURE
  That the Farm Waste Grant (Nitrate Vulnerable Zones)(England) Scheme 2003 (S.I., 2003, No. 562), dated 6th March 2003, a copy of which was laid before this House on 10th March, be approved.
  FEES AND CHARGES
  That the draft Department of Transport (Fees)(Amendment) Order 2003, which was laid before this House on 11th March, be approved.

  PREVENTION AND SUPPRESSION OF TERRORISM
  That the draft Terrorism Act 2000 (Code of Practice on Video Recording of Interviews)(Northern Ireland) Order 2003, which was laid before this House on 12th March, be approved.—[Derek Twigg.]
  Question agreed to.

POLICE (NORTHERN IRELAND) BILL [LORDS] (PROGRAMME) (NO. 5)
Motion made, and Question put forthwith, pursuant to Orders [28 June 2001 and 29 October 2002],
That the following provisions shall apply to the Police (Northern Ireland) Bill [Lords] for the purpose of supplementing the Orders of 10th February 2003, 4th March 2003, 5th March 2003 and 26th March 2003.

POLICE (NORTHERN IRELAND) BILL [LORDS] (PROGRAMME) (NO. 5)
  Consideration of Lords Message
  1. Proceedings on consideration of the Lords Message shall (so far as not previously concluded) be brought to a conclusion two hours after their commencement.

  Subsequent stages
  2. Any further Message from the Lords may be considered forthwith without any Question put.
  3. Proceedings on any further Message from the Lords shall (so far as not previously concluded) be brought to a conclusion one hour after their commencement.—[Derek Twigg.]
  Question agreed to.

Police (Northern Ireland) Bill [Lords]
Lords amendments to certain Commons amendments considered.
Police (Northern Ireland) Bill [Lords]
  Clause 37

    ORDERS AND REGULATIONS
    Lords amendment: No. 48ZA, in Commons amendment No. 48, leave out "or (Belfast)(2)" and insert—

    ",(Belfast)(2) or (Appointment of constables with special policing skills)(7)".

    4.33 pm
    The Minister of State, Northern Ireland Office (Jane Kennedy): I beg to move, That this House agrees with the Lords in the said amendment.
    Mr. Deputy Speaker (Sir Michael Lord): With this it will be convenient to deal with Lords amendment No. 49A.
    Jane Kennedy: The Government tabled amendments 48ZA and 49A in another place in response to a recommendation by the Delegated Powers and Regulatory Reform Committee, under the chairmanship of Lord Dahrendorf. They provide for the affirmative procedure to apply to an order that the Secretary of State might introduce under the new clause that deals with the exceptional arrangements for recruiting constables with specialist skills. Hon. Members will recall that we debated that matter at some length last week.
    The exceptional arrangements will be available for two years, starting from the date of the Bill's Royal Assent. The Secretary of State may extend the life of the provision on only one occasion—by order in Parliament, to allow it to operate for a maximum period of four years. At the end of two years, the Secretary of State could consider extending the provision. Any such extension would require the unanimous agreement of the Policing Board. It is important for hon. Members to bear that in mind.
    Given the importance of the provisions and the strong views about the 50:50 recruitment arrangements that were expressed forcefully in the House and in the other place, we have agreed that it is appropriate for any order to renew the provisions for a further period of up to two years to be brought before both Houses of Parliament rather than be made by negative procedure.
    I commend the amendments to the House.
    Mr. Quentin Davies: We had a good opportunity to deal with the substance of the procedural amendments last week. I do not wish to reiterate those arguments. Clearly, the procedural change from negative to affirmative resolution is welcome. The Opposition therefore second the amendments.
    Lembit Öpik: There was considerable criticism of the Government's original proposals. All parties will be pleased that the Government have listened and tabled a late manuscript

    41
    amendment to provide for a change to an affirmative instrument. Given that policing is so sensitive, that is the right thing to do. The Liberal Democrats wholeheartedly support the good sense that Ministers have shown on the issue.
    Lady Hermon: I assure hon. Members that my colleagues are with me in spirit, if not in body. However, I could not possibly speak for members of the Democratic Unionist party. I am surprised that none of them has turned up this afternoon, given that we are considering policing.
    I should like reassurance from the Minister on one aspect. My views on 50:50 recruitment are well known. The Minister knows that my constituent, Mark Parsons, tested that recruitment procedure last July in the High Court in Belfast. The case will be heard on appeal towards the end of May. I have no quarrel with the special provisions and the recruitment of constables with special policing skills, especially detectives, which we desperately need in Northern Ireland. I voted for the amendment on that when we previously discussed the matter in the House.
    Will the Minister assure me that renewal through affirmative resolution, which I support, and extension by order of the Secretary of State initially for two years and possibly for a further four years, will not make inroads into section 46 of the Police (Northern Ireland) Act 2000? We should bear it in mind that section 46 is due for renewal in spring 2004, that the Mark Parsons case will be heard on appeal, and that its critical point was the temporary nature of the provision that permits the current discriminatory recruitment procedures. Will the Government consider removing that instead of extending it?
    Jane Kennedy: The hon. Lady asks a valid question and I know of her acute interest in the matter. The renewal powers for the special arrangements for the 50:50 recruitment of Catholics and non-Catholics for the Police Service of Northern Ireland are sensitive, for the reasons that we debated last week. Their purpose is to address a specific problem that we experience in Northern Ireland. The renewal powers will allow Parliament to consider whether those exceptional circumstances still remain. We are considering a special exemption for the 50:50 powers, and I would not foresee the measure that we are discussing today having an impact on the other arrangements. We shall still consider whether we need these special affirmative recruitment powers—these discriminatory powers, as the hon. Lady describes them—to address the specific problem. We shall still need to consider whether the circumstances exist to justify those powers, at the appropriate time.
    The measure before us will deal specifically with the circumstances that we were talking about, in which the Chief Constable has identified a particular shortfall and the Policing Board has agreed that such a shortfall exists. Such a situation should be dealt with using this exemption. The arrangements will not be exactly as the hon. Lady described. I did not wish to imply that the exemption would apply for two years, followed by four years. It would apply for two years for constables with specialist skills. There would then be consideration as to
    42
    whether it should be extended for a further two years—that is, the exemption itself, not the 50:50 arrangements as such.
    I hope that that will reassure the hon. Lady. She asked a very good question. I am grateful for the support that I have received from both sides of the House for this amendment. It is a sensible one that meets the concerns raised in another place, and I hope that the House will agree to it.
    Lords amendment agreed to.
    Lords amendment: No. 48A, in Commons amendment No. 48, at end insert—

    "(2B) No order may be made under section (Independent members: disqualification)(2) or Belfast)(2) at any time when section 1 of the Northern Ireland Act 2000 (c.1)(suspension of devolved government) is in force."

    Jane Kennedy: I beg to move, That this House agrees with the Lords in the said amendment.
    Amendment No. 48A deals with the commencement of the new clauses dealing with disqualification and the Belfast sub-groups. We spent a whole day considering the clauses on Report last week, and, in particular, discussing the context in which they might come into effect. My right hon. Friend the Secretary of State and I made it clear—we certainly sought to make it clear—that neither of these provisions will come into force when the Bill receives Royal Assent. They will be commenced only by means of a subsequent order, which will be subject to the affirmative resolution procedure of both Houses of Parliament.
    The Government have consistently made it clear that we would envisage bringing the clauses into effect only in the context of acts of completion. That phrase, which I have used consistently throughout our deliberations, has attracted some criticism, but my right hon. Friend the Secretary of State was even more specific on Report when he said of the clauses:

    "They will not come into effect unless we have agreement that those acts of completion have been dealt with." —[Official Report, 26 March 2003; Vol. 402, c. 361.]

    I recognise that many hon. Members have concerns about what is meant by the term "acts of completion". This debate was continued in another place when the Bill returned there last week.
    My own view, put simply, is that we need a situation in which the brave new world envisaged by the Belfast agreement is working properly and as it should, in which the institutions are working effectively, and in which the basis for politics in Northern Ireland is trust and mutual co-operation, not threats and fear. I sense that Members of both Houses of Parliament are looking to the statute to find a way of summing up those sentiments. Of course, there will be an element of political judgment for the Secretary of State as to when such a point is reached. The hon. Member for Montgomeryshire (Lembit Öpik) made that point in his speeches on this issue. I know, however, that Members are concerned that the decision should not be left to the Secretary of State alone.
    We have said previously that the clauses would not be commenced without the explicit approval of both Houses, and that no commencement order would be brought forward before acts of completion had been dealt with. I think that I failed to reassure the hon. Member for North Down (Lady Hermon) on that point

    43
    last week. The Lords amendment before us today, which was tabled in another place in the names of Lord Smith of Clifton and Lord Glentoran, provides that the clauses cannot be commenced unless devolution has been restored—that is, unless the institutions are up and functioning. In our different ways, we are each aiming for the same thing.
    4.45 pm
    For devolution to be restored, trust must first also be restored, and it must be restored sufficiently to enable all the parties to feel that they can come together, once again, in collective government. For that trust to be restored, we must first see that the paramilitaries are serious. We must see acts of completion. The Lords amendment would add another element to the judgment that the Secretary of State would have to make on whether it is appropriate to introduce the commencement order—whether the time is right.
    In another place, the Government agreed that the amendment that we are considering would provide helpful clarification of the circumstances in which we might expect those clauses to become effective. I commend it to the House.
    Mr. Quentin Davies: Clearly, the Opposition agree with the amendment in the sense that we will not oppose it—indeed, it was introduced in another place by my noble Friend Lord Glentoran—although that is not the end of the story. I have a number of problems with the situation that could result from the amendment, and no others, coming back from the House of Lords, so I want to express them to the Minister, if I may.
    We had hoped that the amendment would be replaced by another, which we thought, as a result of the voting last week, would have considerable support in the Lords. Such an amendment would, of course, have removed the provisions in respect of allowing ex-terrorists to be independent members of district policing partnerships and the creation of the sub-groups in Belfast on the ground that it is quite wrong to hold out such concessions at present. We should wait and see whether Sinn Fein-IRA and other paramilitary organisations are indeed serious about decommissioning and disbanding.
    On that basis, there was considerable consensus on both sides of the Gangway on this side of the House, but, characteristically and as one could have anticipated—indeed, we did—the Liberal Democrats, who were prepared to use brave language last week, were rapidly rolled over in the Lords. They did not support in another place the amendment that they had supported here.
    Mr. Henry Bellingham: Surprise, surprise.
    Mr. Davies: Of course, none of us in my party is in the least surprised at what happened, nor are Government Members. I am afraid that I have to say to the hon. Member for Montgomeryshire (Lembit Öpik) that such behaviour simply reinforces a general impression that the Liberal Democrat party is essentially frivolous,
    44
    irresponsible and not prepared to stand up in one Chamber of this Parliament for the position that it has taken up in the other. Indeed, we know that in other cases it was not prepared to sustain the same position from one week to the next, even in this Chamber.
    David Burnside: Is the hon. Gentleman prepared to give way to the hon. Member for Montgomeryshire (Lembit Öpik), if he is prepared to intervene, so that he can tell the House why the Liberal Democrats have gone back on their word?
    Mr. Davies: The hon. Gentleman asks a pertinent question. No doubt the hon. Member for Montgomeryshire will seek to catch your eye, Mr. Deputy Speaker.
    Lembit Öpik: Will the hon. Gentleman give way?
    Mr. Davies: If the hon. Gentleman wants to answer now, I shall give way.
    Lembit Öpik: I thank the hon. Gentleman for giving way. To clarify, I am happy to explain the position, although that would more appropriately be done in my speech, should I catch your eye, Mr. Deputy Speaker.
    Mr. Davies: Well, at least we now have an assurance that we will get some explanation. No doubt the hon. Gentleman will use the rest of the time that I take up, which will not be very long, to prepare his explanation. An explanation of such a shift is certainly required in any democratic Parliament. Most of us who are elected to this place like to think that we stand for something, and we are prepared to be accountable for it. Indeed, our words are recorded in Hansard, presumably so that we can be held to account. For responsible politicians to behave as the Liberal Democrats regularly behave in this place is to make a mockery of our proceedings. It is extremely sad that that should happen on a matter of such importance.
    We do not, however, as a result of the Liberal Democrats' change of mind—that may be the politest way of putting it—have that amendment to consider; we have another one, which is not so satisfactory. It states that the Government would not bring forward a statutory instrument to give effect to the new provisions in the Bill in relation to disqualification of ex-terrorists and the sub-groups, while the devolved institutions have been suspended—while direct rule persists and while there is no Assembly and Executive in Belfast. At first sight, any restriction—which it is—on the Government giving force to those new provisions in present circumstances is welcome. I must say, however, that the restriction is extremely limited [Interruption.] If I may, I shall explain to the lion. Member for North Down (Lady Hermon) the main deficiency in the amendment, which will enable her to respond to my view of it as a whole. If I am wrong, perhaps she will want to intervene, and 1 shall be delighted to give way to her so that she can correct me.
    The restraint is not very reassuring or adequate, because if the Government are to call elections, as they have said, on 29 May, they must, as I understand it, at least momentarily restore the institutions in order to dissolve the Assembly. If the Government were so

    45
    minded, therefore, they could take the opportunity at that moment to bring forward the statutory instrument giving effect to these new powers. When the new Assembly is elected, on 29 May, I presume that it will sit whatever happens in terms of the peace process. Under the Northern Ireland Act 1998, which is basically the constitution of Northern Ireland, the Assembly has six weeks to agree on an Executive. During that period of up to six weeks, in which the Assembly is sitting, the circumstances might be that the necessary acts of completion, decommissioning and disbandment have not been carried out, and no real chance would exist of bringing together a power-sharing Executive including Sinn Fein. The Assembly might therefore meet under a considerable cloud, with a general sense of doom.
    As I have said many times from this Dispatch Box, in those circumstances, unless all these matters can be resolved, and it is clear that, after a six-week period, no agreement will be reached on an Executive, the only alternatives provided in the 1998 Act would be new elections or the suspension of the institutions and restoration of direct rule. Either of those would be a farce, and would send a clear signal to everybody that the whole Belfast process had failed. That would be very sad. Nevertheless, during that six-week period, the institutions would be working, devolution would be in force, and, under the amendment, the Government, if they so wished, could without further let or hindrance introduce the statutory instrument to give effect to the new powers in the Bill, of which we strongly disapprove in all circumstances except those involving a comprehensive and definitive settlement. Indeed, we have great reservations about those powers even in those circumstances.
    Two major lacunae therefore exist in the protections afforded by the Lords amendment, and it is right to draw attention to them.
    Lady Hermon: I am most grateful to the hon. Gentleman for giving way so gracefully. It is a lovely and welcome change, as he is sometimes resistant to taking interventions, so he is in good form this afternoon.
    May I ask the hon. Gentleman to address one particular aspect of the proposals? I noticed the words that he used: he said that that he welcomed what he regarded as an additional restriction. If an order were made by the Government lifting suspension, those Ministers who are currently suspended—which is a wonderful description—would go back into office. Two Democratic Unionist party members, however, who are unfortunately not here to speak for themselves—far be it from me to speak for the DUP—resigned before suspension was brought into force in October last year, and would not go back into office. Does not the hon. Gentleman regard that as a problem with the restriction, as he sees it, that we are considering this afternoon?
    Mr. Davies: I am grateful to the hon. Lady. I try to give way whenever I can. I did not when she sought to intervene in the debate last week because I had already said that I could not take any more interventions. I know that she will agree that, when there are time constraints, it is important to stand by such a declaration. Rather more notably, I refused to give way to the Minister of State last week because she refused to
    46
    give way to me. As I said then, reciprocity must apply in these courtesies. It was important to make that point. However, I do not think that the hon. Member for North Down will find that I have ever been reluctant in principle to give way.
    The hon. Lady sets out the position with regard to the DUP Ministers. No doubt she is right but she would not expect me, the Opposition spokesman, to give her a legal ruling on that. Whether that adds to my concern about the inadequacies of the amendment I do not know, but it certainly does not detract from it. I think that she will agree that there are those two opportunities at least—others may come out of the debate this afternoon—for the Government to introduce the statutory instrument, without any constraint in the Bill.
    As hon. Members know, the Opposition are very worried about that. We are worried about statutory instruments being used for that purpose anyway. The Government know that, with their massive majority, they can always get them through. The problem with a statutory instrument is that one cannot amend it, whatever the circumstances and however they may have changed. Therefore, it is, as I have said before, a blank cheque. Nevertheless, this is a restriction. It does not go very far but it would be illogical, if we oppose a measure, to oppose some restriction on the measure. Therefore, we will not oppose the amendment.
    I have, however, two immediate concerns. One has been brought to the fore by some of the remarks by the Minister of State about acts of completion. She recognised, and I am glad that she did, that many of us in the Opposition and in Northern Ireland, which is perhaps even more important, have the gravest doubts about the use of that word and see considerable suspiciousness in the Government's determination to talk about an abstraction when a concrete act is what is required.
    As I have pointed out, to talk about acts of completion is a contradiction in terms. It is an oxymoron. One cannot have several acts of completion. If one is completing a process, that is one act. One cannot complete it again a second time the next day, the following Tuesday and the following month. It has either been completed or it has not.
    Why are the Government using that oxymoron? Again, that can only excite the gravest suspicions. My first concern is that the Government may still have in mind that they wish to settle for something less than full decommissioning and disbandment of the IRA and of other paramilitary organisations in Northern Ireland. We should not settle for anything less than that.
    If the settlement that it is now widely anticipated will be reached on Thursday is based on anything less than full decommissioning and full disbandment, it will not be a definitive settlement. It will not be closure. It will not be completion. Why? Because there will have to be another round and perhaps another after that and another after that. Until the Government say, "We will not settle for anything less than full decommissioning and disbandment," there will always be a paramilitary organisation there that has weapons, there will always be a question of how to negotiate to persuade them to get rid of those weapons and there will always be paramilitary organisations involved in training, procurement, recruitment and all the other things that

    47
    paramilitary organisations do. There will be a continuing threat to peace in Northern Ireland and to democracy in Northern Ireland and we will continue to have political parties that have a private army at their back. Therefore, we will not have achieved anything.
    5 pm
    If the Government are to be taken remotely seriously, and if there really is a fork in the road—the Prime Minister used that phrase in his speech in Belfast in November—and a choice between peaceful and non'peaceful means, that choice has to be made 100 per cent. this Thursday. This is perhaps the last opportunity before Thursday for me to repeat what the Minister has heard me say countless times before in the past one and a half years: we must settle for nothing less than complete decommissioning and complete disbandment. It is therefore a mistake to suggest that we will settle for anything less. It is wrong to use some other intermediate term or abstraction; we should be using a phrase that is extremely definite, extremely clear and extremely unambiguous. For the Government to introduce an element of ambiguity where there should be none is not tactically clever; actually, it is tactically very foolish.
    I turn to my second concern. If, as the media tell us, matters are moving towards the crunch and we may get a settlement on Thursday—perhaps with the help of the honest brokerage of, or pressure from, the President of the United States in Belfast today and tomorrow—and if it really is the balanced, comprehensive and definitive settlement that we Conservatives have called for for a long time, we shall of course welcome it with great enthusiasm. However, we shall naturally examine it with scepticism, to make sure that it really is such a settlement.
    Whatever happens, Mr. Deputy Speaker, Parliament, as I know you will agree, will have to take a decision, and it should have the right to do so as soon as the facts are known. It is therefore very important—I hope that the Minister will forgive me for saying now what I have said to her privately—that a statement be made to Parliament on Thursday. If the Taoiseach and the Prime Minister are to make an announcement on Thursday—I hardly think that Mr. Speaker would not consent to interrupt business for such an important matter—we, too, should have a statement, regardless of the time. If the Prime Minister cannot be here himself, my opposite number, the Secretary of State for Northern Ireland, would be the natural person to make such a statement, in order to explain to Parliament what has happened, and to allow it to take a view. It would be utterly wrong for such a statement to be left until Friday, when everybody else has had their say in the media, and for us still not to have heard from an authoritative and unambiguous source about what happened in Belfast. It would be a crying scandal and an insult to Parliament for such a statement to Parliament to left until after a weekend of speculation.
    David Burnside: Does the hon. Gentleman agree that perhaps matters will not move quite as fast as he fears? In terms of deciding on the package and on acts of completion—I agree with the hon. Gentleman about the semantics of "acts of completion"; I would prefer the
    48
    phrase "complete acts"—the crucial element is the decision of the Ulster Unionist party. We will take the decision as to whether we rejoin an all-inclusive Executive. As our party's leader, my right hon. Friend the Member for Upper Bann (Mr. Trimble), has said often in this House, we will not be jumping first again, as we have done in the past three or four years. We need some time to see whether disbandment and destruction of illegal weapons and explosives is complete and absolute. Unless that is achieved, we will not enter into an Executive.
    Mr. Davies: I am reassured to hear the hon. Gentleman say that, and he is right to do so. He is also right to set out the score in advance, so that there can be no misunderstanding about what needs to be done. He will undoubtedly agree with me that any misunderstanding could be absolutely fatal. Any sense on the part of Sinn Fein, or of anybody else, that something less than the real thing will be settled for—that eventually, if necessary, 85 per cent. will be settled for–would be absolutely disastrous, and could cost us the last real chance to bring to its consummation the peace process launched by the Belfast agreement. We all know that, if we do not grasp this opportunity now, it will be very difficult to continue that process under any circumstances much beyond this summer. I am therefore glad that the hon. Gentleman has made his point so clearly.
    I of course understand that the Ulster Unionist party will need to take its time on this issue, and I am sure that we will hear its view, along with those of the other parties in Northern Ireland, in due time, which must be in their time. However, I was talking about the Government. If they publish the Hillsborough document on Thursday, come to some provisional agreement with another Government—I am thinking, of course, of the Government of the Republic of Ireland—and make a statement to the press, a statement must be made to this House at the same time. [Interruption.] I see that the hon. Member for South Antrim (David Burnside) is nodding, and all of us, as parliamentarians, must agree with that principle.
    When we are dealing with important matters that have been the subject of detailed negotiation, and when the moment comes for the Government to make a public statement, perhaps jointly with the Government of the Irish Republic, about what agreement has been reached, we cannot allow everyone except the House of Commons to be informed. The parties are told, along with the press, the local media in Northern Ireland, the media in the United States and Australia, but all sorts of speculation, as ever, gets mixed up in the reporting of these matters. The British public might be somewhat confused, but if the Government will not issue an authoritative statement to the House, it leaves us in an impossible position. I trust that the Government will not do that.
    Lady Hermon: I am grateful to the hon. Gentleman for generously taking a second intervention from me this afternoon. In view of what he said earlier, does he agree that when the Secretary of State makes a statement on any agreement coming out of Hillsborough, it is vital to spell out any additional changes to policing in Northern Ireland? The hon. Gentleman will know that after the

    49
    Police (Northern Ireland) Bill had passed through the House and before it went back to the other place, changes were made to the Belfast sub-groups and further changes were made to allow people with criminal and terrorist convictions to become independent members. At the Ard Fheis in Dublin, Sinn Fein said that that had not gone far enough. It was still unhappy and its spokesman on policing, Gerry Kelly, is reported to have said that

    "they have not yet achieved the threshold for a new beginning to policing."

    Clearly, Sinn Fein is looking for still further advances. Does the hon. Gentleman expect the Secretary of State to announce even more changes in his next public statement?
    Mr. Davies: I hear what the hon. Lady says. She is always well informed about such matters, and she is right that policing is a sensitive subject for both republicans and Unionists in Northern Ireland. As the hon. Lady knows, in negotiating processes, none of the parties secures 100 per cent. of their desiderata. It would be an unnatural and peculiar negotiation if they did, because no negotiation would have been necessary in the first place. It is perhaps natural at this stage that various parties are saying that they do not like this or that.
    The Government have the responsibility to make a success of the peace process. I know that they want to do all that they can, but they must take their own decisions on the basis of their conversations, whether individually or jointly, with the political parties. We have said all along that it is a mistake to think that one can square with one party by giving away some concessions and then try to do the same with the next party. That is not possible because everything is interlinked. Only general and contingent conversations are possible: if we are to secure effective agreement, all the parties have to be taken along with the Government almost simultaneously. The Government must be the judge of their own tactics and they can decide whether they want to listen to us. When they have not done so in the past, they have come adrift, but when they have followed our suggestions, they have secured favourable results on the whole. Let us hope that they have learned their lesson.
    The Government must also be the judge of the right time to go public and make a statement about what progress has been achieved, and to clarify how they envisage the future of the process. We are told through the media—not through a statement to the House of Commons—that we are coming to a crunch this week and that a statement may be made on Thursday. I hope so: we all hope that sufficient progress will have been made to warrant such a statement. However, if a public statement is to be made, it must be made—ideally, first—to the House.
    I realise that a joint statement with the Irish Government presents greater difficulties, but I see no reason not to make a simultaneous statement—or within just a few hours—to the House, following any joint declaration, whether in Belfast or elsewhere, by the two Governments. That was certainly the procedure adopted by the previous Conservative Government after the Downing street declaration. Indeed, a statement was made to the House within two or three hours of that declaration. I hope that the Government will follow that good precedent. They have not said that
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    they will not, and I trust that they will. As I said, because of the difficulties in the past and in the light of the suspicions in some people's minds, it is right to make the point in public now. I hope that I shall have no further occasion to mention that, except, perhaps, to say on Thursday that I am grateful for such a statement being made as quickly as possible after any intergovernmental declaration.
    I hope that that is not controversial. Obviously, if the Minister wishes to respond, I shall listen intently. I hope that the Government's business managers and the Leader of the House have taken note of these feelings. On this, if nothing else, I believe that I speak with the support of a wide range of parliamentarians on both sides of the House.
    Lembit Öpik: The amendment was tabled by the Liberal Democrats and supported—grudgingly, I now realise—by the Conservatives. It would introduce an order preventing the powers on ex-prisoners becoming members of district policing partnerships and the Belfast sub-groups from coming into force until the Assembly had been restored.
    We all agree that we would not want such powers to be introduced until acts of completion had taken place. Everybody understands that, and it has been debated recently, but the argument is based on whether it is possible specifically to define "acts of completion" to the extent that that could be included in the Bill. Unfortunately, the hon. Member for Grantham and Stamford (Mr. Davies) does not have a full recollection of what I said, although obviously he can re-read my speech in Hansard. The crucial element was my challenge to Ministers to accept either that they had to include acts of completion in the Bill, or that they had to concede the apparently obvious point that every Secretary of State has chosen to maintain some political flexibility in defining acts of completion.
    That was a stark option and, in fairness, the Secretary of State went a long way towards implicitly accepting something that we already knew: that Secretaries of State would maintain that flexibility, which is no greater than that displayed by John Major when he was Prime Minister and by many of his Ministers when they were in charge of Northern Ireland policy.
    In the intervening time, I have been persuaded that it is difficult, legally, to define what can be construed as an act of completion. For me, it would need to consist of decommissioning, an end to paramilitary beatings, shootings and intimidation and a statement from paramilitary groups lifting the threats against those exiled from their homes and allowing them to return.
    For me to say that I am persuaded that it is hard to define acts of completion is not to suggest that I have changed my view. I never thought that it was easy to define. Had the Secretary of State asked my advice, it would have been for the Government to say that acts of completion were as much symbolic statements as they were measurable in any practical sense. To that extent, following consideration and discussion, it seemed appropriate for us to move forward in line with amendment No. 48A towards something that seemed to be significant progress on how the Bill was laid out.
    In my judgment, amendment No. 48A effectively adds considerable responsibility to the Northern Ireland parties in terms of the decision-making process and of

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    how far the paramilitaries have come. The fact that the restoration of the Assembly is an essential element provides us with a creative solution to at least part of the problem.
    Disappointingly, the hon. Member for Grantham and Stamford sought to gain party political capital from the fact that the Liberal Democrats have approached this issue pragmatically. I counsel him to he cautious. It was, after all, the Conservatives who signed the amendment. Clearly, Conservative Members who thought that we might gain a significant victory signed the amendment grudgingly. The hon. Gentleman himself said that the Conservatives were going to vote against some Northern Ireland measures on principle, although we established from his words—it is all there in Hansard—that they disagreed with only two of the 298 clauses of the Bill in question. However, the retreat was sounded and the Conservatives abstained. The Conservatives criticised the suspension of the Northern Ireland Assembly, but were unable, during cross-questioning by me and others, to say what they would have done as an alternative, apart from some bluster about the fact that the Government were punishing the wrong people.
    On another occasion, the Conservatives, led by the hon. Member for Grantham and Stamford, voted against the extension of an amnesty that they had introduced. That is cynicism; it is an inconsistent approach to Northern Ireland politics. By comparison, the Liberal Democrats try to take an honest, transparent and constructive approach.
    5.15 pm
    Mr. Quentin Davies: Everything that the hon. Gentleman has said—every allegation that he has—made has been misinformed or fanciful. In parliamentary terms, I cannot put it more strongly than that. The suggestion that we criticised the Government for suspending the institutions without proposing an alternative is absurd. Last July, before the crisis—we expected there to be a further crisis, given the Government's tactics—I set out our alternative, which was to provide the Secretary of State with powers to suspend. All the hon. Gentleman's comments are completely nonsensical. My noble colleagues in another place accepted the amendment, albeit reluctantly—as I rightly and advisedly pointed out—because the more desirable amendment, which, given the assertions of the hon. Gentleman and his colleagues last Thursday, we had every expectation would pass with Liberal support, was not accepted because the Liberal Democrats changed their mind. As always, they simply run away as soon as they hear sound of cannon fire. They only need a telephone call from No. 10 saying, "Please fall back into line" and they fall back into line.
    Lembit Öpik: I always enjoy the hon. Gentleman's words, even when they are directed at me. I am smiling only because his retort was so well constructed, but in response may I ask him whether it is beyond his capacity to understand the point that I made? I am sure that it is not, and that he is being mischievous. I remind him of what I said only a few days ago to the same Members to whom I am speaking now, standing in this very spot—or within six inches of it: the Government should either
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    include provisions about acts of completion in the Bill, or accept that they want to maintain political flexibility in defining acts of completion. I should have liked the Secretary of State to admit what every Secretary of State for Northern Ireland has known for the last 20 or 30 years: in such matters, Ministers always want latitude so that they can change their position based on expediency. I stated that if the Government were willing to admit that we would drop the proposal. In effect, that is what the record shows.
    The hon. Member for Grantham and Stamford is entitled to say that he does not accept my binary alternative—of including provisions about acts of completion in the Bill, or accepting that political flexibility is required and doing something else. However, the Liberal Democrats are comfortable that the Government have implicitly accepted that point and that Ministers have accepted an amendment, proposed by Lord Smith of Clifton, that would reduce the latitude a little more and, crucially, would introduce an element of responsibility for the Northern Ireland parties themselves in the decision about when acts of completion had been fulfilled.
    Lady Hermon: When an order lifting suspension is made, only the 10 Ministers who are currently suspended will return to office. The two Democratic Unionist Ministers resigned before suspension, so they will not automatically resume office. The Policing Board is made up of 19 members, 10 of whom are Assembly Members. It would thus be difficult for DUP Members to continue their membership of the Policing Board. That is an important change from our previous policy and I am not at all happy with the amendment. Before the hon. Gentleman welcomes it so enthusiastically, will he address the issue that I raised?
    Lembit Öpik: If the hon. Lady will allow me to do so, I would be more inclined to intervene on her speech to respond to that issue in specific terms, because it has more than one element. In strategic terms, she is right. The amendment would introduce other issues, but those are less profoundly worrying, certainly to me, than not having the condition on the restoration of the Assembly in the first place. Any Government can play with legislation to get what they want if they are willing to move away from the spirit of that legislation. Perhaps partly because of the pressures that the hon. Lady describes, there is a genuine cost to Northern Ireland parties if they do not constructively participate in making the decision.
    The hon. Member for Grantham and Stamford annoyed me a little by suggesting that there is a degree of cynicism among Liberal Democrat Members. He may question my list of criticisms of the Conservatives, but I wonder whether he would really deny that on one occasion he suggested that the IRA had initiated acts of decommissioning because the Conservative party had called an Opposition day debate on Northern Ireland policy. He may say now that that was a joke or that it was fanciful, but he cannot deny that that is what it says in Hansard.
    Moving on to the present day, the hon. Gentleman, in criticising the amendment and speaking more generally, said—I paraphrase—that were he Secretary of State for Northern Ireland, he would demand complete

    53
    disbandment and complete decommissioning. What does he mean by complete disbandment and complete decommissioning? If he can outline a clear process whereby we can understand that those two things have happened, he is not only in the wrong job—he should be the decommissioning commissioner—but he will have gone far further than anyone has so far been able to go in the course of this debate.
    Mr. Quentin Davies Mr. Quentin Davies rose—
    Lembit Öpik: The hon. Gentleman is about to give us another pearl of wisdom.
    Mr. Davies: I shall take the hon. Gentleman's point seriously because we are dealing with very serious matters. Disbandment means the end of the IRA, or the end of the paramilitary organisation concerned, as a paramilitary organisation—in other words, the end of any structures or activities that are directed towards violence. That must be absolutely plain. I cannot be straighter than that.
    As regards decommissioning, one of the great virtues of the Belfast agreement and the peace process is that we have the huge advantage of having an objective mechanism so that we do not have to argue until kingdom come about whether decommissioning has been completed and whether the odd shotgun is stuck up in someone's attic—that is bound to happen—because we have General de Chastelain and the international commission. When General de Chastelain determines that decommissioning has been completed, it has been completed.
    Mr. Deputy Speaker: Order. May I say to the hon. Gentleman, who is not alone in this respect, that interventions are getting longer and longer? In fact, they are starting to get longer than the contribution by the hon. Gentleman who has the Floor.
    Lembit Öpik: Furthermore, Mr. Deputy Speaker, we are in danger of providing the world with a treatise on Conservative party policy on Northern Ireland, and I am guilty of that.
    I will conclude my defence against the Conservative outburst by highlighting the difficulty of the hon. Member for Grantham and Stamford, who, in trying to describe full disbandment, simply said the same thing using different words. Would he think that if 10 people in Northern Ireland who used to be IRA members happened to go for a drink together and talk about the good old days, it would mean that they had failed to disband? How would he define the disappearance of structures given that in many ways structures are both attitudinal and a passive, sleeping environment that could be restored at any time? A more serious point is involved. If the hon. Gentleman seeks to portray himself as having great clarity, he needs to be more understanding of the nature of attitudes in the republican movement. For him to demand complete disbandment is not only unmeasurable but counterproductive. By comparison, the proposal in amendment No. 48A is clear, measurable and deliverable, and it would reintroduce the Northern Ireland parties to the loop. I accept that the hon. Member for North Down (Lady Hermon) has raised
    54
    one of the amendment's problems and I do not say that it is perfect. However, we have made progress by convincing the Government that it represents the way forward.
    I understand that this week the British and Irish Governments are due to publish the package that was put before the parties at Hillsborough and I shall be interested to see what it contains. All sides will have to consider what the institutions of government are worth and ensure that their actions are sufficient to demonstrate that they are acting in good faith.
    The bottom line of the debate is whether we accept amendment No. 48A as a significant improvement to what we had before. The Liberal Democrats actively welcome it and it is, apparently, grudgingly accepted as a long second by the Conservatives. Alternatively, we could reject the amendment and retain the original provision. The Liberal Democrats have a practical approach on Northern Ireland policy. We are honest about what we say and open about what we believe. I am pleased that people in all parties share the same approach much of the time. John Major spoke to terrorists while they were still killing our soldiers, which was to his credit because if it had not happened there would have been no progress. It would be nice to see the Conservative party welcome—just once—a measure of substantial importance in good faith. If it does, when the Liberal Democrats are in government we shall be more sympathetic to its proposals.
    Lady Hermon: I apologise for my lengthy intervention on the hon. Member for Montgomeryshire (Lembit mpik). I shall be delighted to give way to him later, and I look forward to him being in government, although I am not sure whether he will be a member of the Liberal Democrats. He will be a member of the Ulster Unionist party, of course. [Interruption.] He will join the Ulster Unionists before he joins the Conservatives. He has a lot of common sense.
    The agreement that I voted for and that I still strongly support is my benchmark. Under the heading "Policing and Justice", it spells out clearly the perceived new beginning for policing. It says that the parties

    "believe that the agreement provides the opportunity for a new beginning to policing in Northern Ireland with a police service capable of attracting and sustaining support from the community as a whole."

    The key words are:

    "from the community as a whole."

    On Report on 26 and 27 March, we made significant changes to the Bill to allow people with terrorist or criminal convictions to become independent members of district policing partnerships. We also changed the rules on the sub-groups in Belfast.
    I shall refresh hon. Members' minds about implications surrounding district policing partnerships. They will operate locally and every one of the 26 district councils in Northern Ireland will have one. Belfast will be divided into four sub-groups. There will be regular interface between a superintendent or chief superintendent and members of the DPPs. It is a matter of great disquiet, to put it mildly, that I regularly hear from constituents who are very concerned that people with criminal convictions, not only terrorist convictions, will be able to join a DPP and tell others how to police the district. That is a very sensitive issue.

    55
    The Minister was right to open her speech by referring to what she said on Report in March. She consistently maintained that changes would be made and that commencement orders for the sub-groups and DPPs would be introduced only in the context of acts of completion. However, the Secretary of State for Northern Ireland was not so consistent. It is worth bearing in mind where we have moved from and where we are today. Early on in that debate, the Secretary of State for Northern Ireland said:

    "We have made it clear that the commencement orders will not come into effect until after the acts of completion."

    I thought that that was clear. However, later in the day—perhaps he should not have been so generous in taking interventions—he seemed to change his mind. In relation to the commencement orders, he said:

    "They will not come into effect unless there are acts of completion. They will not come into effect unless we have agreement that those acts of completion have been dealt with."—[Official Report, 26 March 2003; Vol. 402, c. 317–361.]

    So it was with considerable surprise and huge irritation that I saw the amendment to change the sub-groups and district policing partnerships. The issue of independent members is sensitive and such changes should not be made lightly. It seems that commencement orders can be made if the Secretary of State brings an order before the House to lift suspension. That is a huge change from where we started in column 317 on 26 March.
    5.30 pm
    I am not happy with the change. I have alluded to the difficulties that the Democratic Unionist party will have with it. In addition, the Ulster Unionist party agreed unanimously—we do that occasionally—on the resolution of the Ulster Unionist Council when we discussed it in our meeting in Belfast on Saturday 21 September 2002. We had a lengthy and detailed discussion on two separate proposals, suggested by right hon. Friend the Member for Upper Bann (Mr. Trimble) and my colleague, the hon. Member for Lagan Valley (Mr. Donaldson), and decided to bring them together. The Ulster Unionist Council agreed unanimously last September—I am not inventing this—in paragraph 6 of its resolution that:

    "The Ulster Unionist Party will oppose further unnecessary changes to the policing legislation and gives notice that it will withdraw from the Policing Board in the event of the government capitulating to the unreasonable demands of Sinn Fein/IRA for further police reform including places for convicted terrorists on district policing partnership boards."

    Every time that Democratic Unionist party Members have been in the House when we have been discussing policing, I have taken my courage in my hands and intervened on one or other of them to ask what their policy would be if Sinn Fein were to join the Policing Board. They have consistently kept to the same line: that they will follow the Ulster Unionist party members of the Policing Board. They have never said what they will do when they stand alone, but they will come off the Policing Board if Ulster Unionist members leave it.
    The Government need to be sensitive to the difficulties that my right hon. Friend the Member for Upper Bann has with any changes. He has an Ulster Unionist
    56
    Council resolution, agreed unanimously last autumn., and members of the council will be sensitive to changes to policing legislation. If the Government were to introduce an order lifting suspension of the Assembly, I repeat that it is a constitutional provision in existing legislation that only suspended Members—only 10 Ministers—will go back into office. The two DUP Members who resigned four days before suspension cannot go back into office; they remain resigned. That will put huge pressure on the Ulster Unionist Ministers: do they stay in the Executive or do they not? My difficulty is that unfair pressure will be put on the Ulster Unionist party—a party that has carried this process and taken risks time and time again.
    Lembit Öpik: I thank the hon. Lady for the offer of membership of her party, which I shall put to the good people of Montgomeryshire when I have a moment. The point that the hon. Lady raises is surely exactly why this proposal could work. I accept that it puts huge pressure on the Ulster Unionist party, but it also puts pressure on the Democratic Unionist party, who could be criticised by the people they represent for not participating, and, more than anything, it puts pressure on Ministers to work in partnership with those parties. The hon. Lady has described a mechanism through which all the parties will be tied into making decisions, and through which pressure will be put on Ministers.
    Lady Hermon: This point will be helpful and will address the point that the hon. Member for Montgomeryshire (Lembit Öpik) has made: the Government must make it clear this afternoon that any order to lift suspension will be made only after acts of completion. To be frank, no order to lift suspension will be worth making unless there have been acts of completion. The Government should also make it clear that the statement of the Secretary of State on 26 March still stands even if we make the changes that we may make this afternoon. The Government must make it clear that commencement orders will not come into effect unless we have agreement that acts of completion have been dealt with. It is hugely important that a clear message is sent out—suspension will be lifted only after acts of completion and, therefore, commencement orders for changes to DPPs and the Belfast sub-groups will be made only after acts of completion. Such a message would be very helpful indeed in clearing away any suspicions that we have given ground too quickly on this issue.
    Jane Kennedy: As I said in my opening comments, the amendment that we are considering this afternoon builds into statute the extra consideration that the Secretary of State must give. The institutions in a power-sharing Executive must be functioning before he would consider the changes that the hon. Member for North Down (Lady Hermon) has been speaking about. She refers to the pressure that she thinks will be placed on her party. I accept that there is a perception that the Ulster Unionist party would come under particular pressure—indeed, the point was raised by one of the hon. Lady's hon. Friends in the other place. She refers to the party's policy, which would prevent it co-operating in a policing board if Sinn Fein were to join in this context.

    57
    I understand the depth of the sensitivities, emotions and feelings on this issue. However, when I have talked to all of the Unionist parties—and not just that of the hon. Lady—and to representatives of the police through the police associations, I have always done so in the context of a Sinn Fein party and a Provisional IRA that are reforming and moving away from paramilitary activity, and that have put paramilitary activity behind them and are prepared to embrace policing as the hon. Lady and I, and you Mr. Deputy Speaker, would understand it. There has been a willingness on the part of, I think, almost everybody, including the Democratic Unionist party, to say that they would consider—in that context—working co-operatively in the interests of the police, of policing and of Northern Ireland. That does not mean that things are any less difficult.
    The hon. Member for Grantham and Stamford (Mr. Davies) talked about his disappointment that an amendment was not carried in another place. I do not intend to comment on that—I shall restrict my comments to the amendment that we are debating today—but I am grateful to hon. Members representing all parties on both sides of the House for the thoughtful, constructive and detailed consideration given to the Bill. There has been genuine co-operation here and in another place in working together to improve the Bill in a spirit of seeking to assist the process, and the Government are grateful to both Houses for that.
    Last week, I met police officers in Dungannon, who police in an extremely difficult security environment, and we discussed such issues in a very open and frank exchange of views. There is no question that trust in the Governments and political parties has to be restored. There is no question that police officers must have confidence if they are to take forward these reforms, as we seek to make this final step that will involve the fullest implementation of the Belfast agreement. That was starkly illustrated to me by those very genuine police officers, who expressed their deeply held views.
    It has been one of the greatest privileges of my political career to work with the highly professional, dedicated police officers, who work in that very difficult environment in Northern Ireland and who put aside even these most difficult issues to work together. Indeed, they are prepared to work with those whom they find it very difficult to work with, but they do so in the spirit of working towards the benefit of everyone in Northern Ireland.
    The hon. Member for Grantham and Stamford talked about the potential for doom and the gloom that may hang over the Assembly. Of course, we may spend time considering that, but he is wrong in the sense that the Secretary of State is not required to restore the institutions before dissolving them. However, it is difficult at this stage to say exactly what will happen. It is important for the House to bear in mind the fact that a great deal of work is still being done and a great deal remains to be completed before we move into the completely new environment that we are seeking to establish.
    The date for dissolution was set for 28 April, to give the parties the maximum time possible to reflect on the shared understanding presented by both Governments,
    58
    and it is important that the parties have as much space as possible to consider the way forward. The hon. Member for Grantham and Stamford commented on what may happen. We all spend time considering what may happen and what circumstances may apply. All that we can say at the moment is that we expect the two Prime Ministers to return to Northern Ireland within the next week to publish their proposals. At that time, all those involved can say whether they accept and endorse those proposals.
    We do not know what the IRA or any paramilitary group will do, but, obviously, every hon. Member hopes that everyone will engage in the acts of completion that we have struggled to define in considering the Bill.
    Lady Hermon: Will the Minister clarify an issue that has also caused considerable disquiet at home? Let us suppose that the suspension is not lifted, that the Assembly is dissolved at the point that she mentions and that the election takes place on 29 May. Is there any point in holding an election at the end of May if we cannot guarantee that the Assembly could work on 30 or 31 May? Will the Government make it absolutely clear that they intend to hold the election on 29 May come what may?
    Jane Kennedy: That is absolutely our intention. We have made that commitment and there is agreement that that should happen, but there is no guarantee about what may happen as a result. There is no guarantee about anything that may happen between now and the election date itself.
    5.45 pm
    As for what we mean by acts of completion, I think the hon. Gentleman was wrong to say that the Government had indicated that they might accept somewhat less than what would be acceptable elsewhere. It is important to remember what the Prime Minister said in his Belfast speech in October. He made it absolutely clear that the paramilitary organisations must end their violence, their preparations for violence and their planning for violence, and that it must be a complete and permanent end. While I accept that there have been a great many questions about that definition, I think it is comprehensive.
    Mr. Quentin Davies: This matter is so important that we had better be precise. I did not say that the Government had indicated that they would accept something less than complete decommissioning and complete disbandment. Thank God, they have not said in advance that they would accept something less, and I pray that they never will accept something less. I spoke, in fact, of the danger of not referring to the completion of decommissioning and disbandment and preferring to use some intermediate symbolic term—some abstraction such as "acts of completion", with all the problems of definition that I mentioned. I said that it might give someone the impression—a false impression, I trust—that the Government could settle for something less. Were that danger to materialise—were anyone to suppose that the Government might settle for something

    59
    less—the chance of securing what we need to complete the settlement would, I am afraid, disappear. I have never suggested—
    Mr. Deputy Speaker: Order. The hon. Gentleman has made his point.
    Jane Kennedy: I agree with the vast majority of what the hon. Gentleman has said. It is indeed a question of carrying all the parties with us.
    The hon. Gentleman pressed me on the issue of a statement to the House. He will appreciate that I have no authority to give him a commitment now, but we have heard his comments. We will talk to colleagues about what has been said today, and I will tell my right hon. Friend the Secretary of State how strongly the hon. Gentleman feels.
    I am grateful for the latitude you have allowed, Mr. Deputy Speaker, in letting us deal with issues that are not defined specifically by the amendment. I hope that President Bush will encourage all parties to endorse the way forward proposed by the British and Irish Governments, and that everyone will become involved in the carrying out of acts of completion on all sides. We are taking nothing for granted. The President's stay today and tomorrow shows how important this week is for Northern Ireland, and the influence of the United States Government can never be underestimated.
    This is indeed a critical week for Northern Ireland. It is, I think, the most important week since the Good Friday agreement. It gives us our chance to implement the rest of that agreement in one final step, something that not just those of us who represent constituencies in England, Wales and Scotland hope to achieve.
    David Burnside: How can the President of the United States—in Hillsborough, tonight or tomorrow; I believe that the discussion will last for about an hour and a half tomorrow morning—endorse a package that the House has not yet received and at which the Northern Ireland parties have only glanced without being told of the details? How can he do that in the next two days when the House and the parties involved are being asked to look at the package on Thursday, having not seen it previously?
    Jane Kennedy: I said that I was sure that the President would encourage all parties to consider the package very carefully, and to endorse it. As the hon. Gentleman will no doubt agree when he has a chance to see the package, it offers the best opportunity for the final move towards the final and fullest implementation of the Belfast agreement. That, I believe, is no less than the people of Northern Ireland deserve.
    Lords amendment agreed to.
    Lords amendment No. 49A agreed to.

  Industrial Development (Financial Assistance) Bill
  Not amended in the Standing Committee, considered.
  Industrial Development (Financial Assistance) Bill

    Clause 1
    INCREASE IN LIMIT ON SELECTIVE FINANCIAL ASSISTANCE
    5.50 pm
    Mr. Andrew Lansley: I beg to move amendment No. 1, in page 1, line 4 leave out

    'The limit shall be £3,700 million'

    and insert—

    'The said limit shall be £3,440 million'.

    Mr. Deputy Speaker (Sir Michael Lord): With this it will be convenient to discuss amendment No. 4 in page 1, line 5 leave out from 'than' to end of line 7 and insert—

    'six occasions and with no more than one occasion within any twelve-month period, by order made with the consent of the Treasury increase or further increase that limit by a sum specified in the order, being a sum not exceeding £200 million.'.

    Mr. Lansley: I am grateful for the opportunity to return to issues that we debated on Second Reading. The Bill is short, so there is not much room to stray from its content. Reflecting on the debate on Second Reading and in Committee, I found that we had not yet completed the process of scrutinising the judgment to which the Government came in the Bill. We ought to return to it, and I hope that discussing the two amendments will help in the process of further examinating—further examining, rather—what the Government are trying to achieve.
    To avoid confusion, and to assist those who read our proceedings and save them having to look back at Second Reading and Standing Committee, let me explain that amendments Nos. 1 and 4 would provide that, instead of what is proposed in the Bill, section 8(5) of the Industrial Development Act 1982 would read:

    "The said limit shall be £3,440 million, but the Secretary of State may, on not more than six occasions and with no more than one occasion within any twelve-month period, by order made with the consent of the Treasury increase or further increase that limit by a sum specified in the order, being a sum not exceeding £200 million."

    That would be the content of the Bill.
    It is obvious that the amendments introduce three substantive changes. First, the limit to be specified on accumulated expenditure under section 8 would be £3,440 million. Secondly, instead of the four further tranches available under the affirmative resolution procedure, six such tranches would be available. Thirdly, instead of tranches of £600 million being able to be authorised in that way, the sum would be £200 million.
    Let us recall the context of the Bill. The history of the provision goes back to the Industry Act 1972. On Second Reading, my hon. Friend the Member for Sevenoaks (Mr. Fallon) reminded us of the vexed political history of that Act. The 1972 Act provided for a sum of £150 million, with four further tranches of £100

    61
    million to be available. It is interesting, and it has not previously been mentioned, that those were not the original terms of the 1972 Bill. That Bill, as drafted, specified a sum of £250 million and four further tranches of £150 million, but in the course of consideration of the Bill, the sums were significantly reduced from those proposed by the then Government.
    The 1972 legislation was not intended to last for 30 years. The then Minister, Mr. Christopher Chataway, summing up the Second Reading debate on 22 May 1972, said:

    "In preparation for entry into Europe the Government have made it clear that they believe that there is a job of modernisation to be done in various sectors of industry. It is in recognition of this factor that the powers under Clause 8, which enable the Government to assist in the modernisation process, lapse at the end of the transitional period."—[Official Report, 22 May 1972; Vol. 837, c. 1130.]

    The transitional period was to last until the end of 1977, as Mr. John Davies, the Secretary of State for Trade and Industry, said earlier in that debate, so the powers to which we are referring and the expenditure that was contemplated were for only a four-year period.
    All that changed in 1976, when the sums were changed and the caveat that no expenditure was to be undertaken after the end of 1977 was removed. The sum in question went up from £150 million plus four £100 million tranches—that is. a cumulative total of £550 million—to a limit of £600 million. In other words, the tranches were consolidated into that limit, and provision was made by order for four additional tranches of £250 million.
    Mr. John Bercow: I am grateful to my hon. Friend, as is the entire House, no doubt, for the history lesson that he is helpfully providing. I, for one, am anxious to complete my education on this important subject. The subsequent ratcheting-up of the available funds in the course of the Wilson-Callaghan Government is no surprise, but would I be right in thinking that the original change downwards that was made from the time the Bill was first presented was the result of activity from the Conservative Back Benches, led by economic liberals including Mr. Enoch Powell?
    Mr. Lansley: I am grateful to my hon. Friend. The latter point is correct. It was Mr. Jock Bruce-Gardyne who led the antagonism to the sums that were intended to be spent and the purposes for which they were to be spent. I do not recall any reference to Mr. Powell in the Second Reading debate. Mr. Bruce-Gardyne was instrumental in questioning the Bill.
    Mr. Kelvin Hopkins: Has the hon. Gentleman calculated the effects of inflation during that time? Would not the sums mentioned in the 1972 Bill be much smaller in real terms and as a proportion of gross domestic product?
    Mr. Lansley: As a proportion of GDP the sums would be smaller, and to a greater extent than would be the case if one were simply to calculate in real terms. It is true that a significant part of the uprating of the amounts specified in the legislation in 1976 and again in 1982, which we shall come to, was the result of substantial increases in inflation in the 1970s. As a
    62
    Labour Member, perhaps the hon. Gentleman should not dwell too long or too hard on the ravages of inflation during the 1970s. In addition to other factors, inflation cost his party dear in 1979. It has cost Parliament and the taxpayer dear as well.
    Rather than saying that the sums got out of control and the amounts were disproportionate to the purpose, I am trying to illustrate the mechanisms in question. In 1976 the mechanism was to consolidate the previous intended expenditure and to make provision for additional tranches subsequently. The intention at that time was that the subsequent tranches would be reached quite quickly. The implied total in 1976, of £600 million in the first instance and four tranches of £250 million by extension, meant a cumulative total of £1,600 million.
    In 1982, not least because of the impact of inflation, and because of the impact of substantial expenditure under the section 8 provisions, which were continuing, the then Government, in a consolidation measure which does not afford us much opportunity to see what was intended at the time, consolidated the previous Industry Acts and uprated the sums in question. The original limit—the said limit under section 8—was raised to £1,900 million, which is a very big increase over the previous £600 million, but was only a small increase—little more than one tranche— in excess of the £1,600 million, which was the cumulative total implied by the 1976 amendments. However, not only were those provisions consolidated, but further provision was made to make further tranches available—£1,900 million in the first instance, along with four further tranches of £200 million.
    6 pm
    It is interesting that the size of the tranches was not further increased. The £200 million tranches were smaller amounts of additional funding than the £250 million that had been provided beforehand. That makes the position slightly different from what the Minister told us on Second Reading:

    "While maintaining the four tranches, we want to increase the ceiling on those tranches—as, indeed, did the previous Government in 1982".—[Official Report, 24 February 2003; Vol. 400, c. 49.]

    Of course, the previous Government did not increase the ceiling in 1982, but lowered it from £250 million to £200 million. That indicated the desire in 1982 for regular parliamentary scrutiny of the additional sums. If the Government had intended to move to £2,700 million and beyond without parliamentary scrutiny, they could have done so without providing for such relatively low limits on the tranches.
    That took us to £2,700 million, which is, of course, the figure that has applied until now. Interestingly, given the sums that were spent in the late 1970s and early 1980s, it is astonishing that the sums provided in 1982 lasted as long as they did and applied until 1996, before the additional four tranches of £200 million were called upon. Of course, as the Minister will no doubt tell us, at or before the end of this year, having passed the final of the four tranches, the Government will take us to that £2,700 million level, but the question is this: how much further should they be allowed to go?
    There is an argument that the Government should not be allowed to go any further at all, as when the money was introduced it was transitional restructuring money

    63
    for industry. I do not propose to advance that argument, however, and my Front-Bench colleagues have not sought to do so either. Whether or not that was the intention when the original powers were introduced, we have seen events move on and a range of schemes have been introduced under section 8 that are clearly not geared to the transitional restructuring of industry to meet the requirements of a competitive marketplace, but are intended to provide for specific measures to deal with perceived market failures that would otherwise inhibit industry's competitive abilities. Examples include the smart scheme, which relates to the promotion of research and development, and the small firms loan guarantee scheme, which deals with the availability of unsecured capital for small businesses. I understand the rationale for those schemes, and although they must be examined carefully, I shall not argue that they can be entirely dispensed with.
    We need to think long and hard about the sums involved and the accountability that applies. The purposes of my amendments are therefore as follows. First, they seek to constrain the amount that is to be provided for under the Bill and which will be available to the Government without further substantive debate in this House. Secondly, they seek to constrain the rate of spend, as it seems clear that, since the Government came to office in 1997, that rate has increased. I do not recall the Minister previously informing us of the level of expenditure in relation to section 8 schemes on an annual basis since 1997, as compared with preceding years. It is clear, however, that the level must have increased, as we have reached the next tranches so quickly since 1996. Thirdly, through the mechanism of limiting the additional tranches of money and ensuring that not more than one can be introduced in any 12-month period, the amendments seek to increase accountability. In effect, in the later stages of the expenditure that the Bill would authorise, the Government would either have to constrain their rate of spend or come to Parliament at least once a year in order to secure through the affirmative resolution procedure the necessary ability to continue the expenditure.
    In case it is not obvious—I am sure that the Minister will have worked it out—I should explain how I arrived at the figures. The cumulative total of £3,440 million is the product of consolidating the existing approved expenditure of £2,700 million and providing for four years' worth of additional expenditure at the rate at which the Government themselves say that expenditure under section 8 is forecast—£185 million a year. Amendment No. 1 would therefore ensure that, if this Government or a succeeding one continued at the current rate of spend, they would probably have to secure parliamentary approval for additional tranches of expenditure in between four and five years' time. That seems a reasonable period, especially when one considers that, in the first 10 years after which the powers were conferred, the Government came to Parliament three times to introduce primary legislation to maintain the expenditure. It is only because of the constraint and limited recourse to section 8 expenditure in the 1980s that such a long period passed—from 1982 until now—before primary legislation was required.
    64
    The provisions relating to additional tranches of £200 million are proposed simply because I see no justification for the assumption that as much as three years should pass in each case before the Government must have further recourse to Parliament. I did not have the privilege of being a member of the Standing Committee, but I know that it carefully discussed accountability and sought to introduce some sort of debate about annual reports. However, instead of a purposeless debate about an annual report, a purposeful debate about the extension of the power to spend section 8 moneys would be far more effective and would concentrate the minds of Parliament and Ministers more. Such a debate would probably be informed by the annual report, but would not relate only to that report. Such a debate would happen pretty much annually and, because of the provision referring to six occasions rather than four, the arrangement would take us about 10 years hence.
    These are all matters of judgment. The Government's assumption is that, because the last consolidation measure, which was introduced in 1982, lasted 20 years, the new power should also last that long. There is no rationale or logic behind that position, which is based merely on an assumption that, because it was good enough to last 20 years last time, it should last 20 years again. My contention is that, if anything, there is a strong rationale for requiring Ministers to consult the House more frequently as time passes where they are simply extending powers without any fundamental revision of the legislative framework.
    The provisions were basically devised in 1972, but 30 years later, Ministers are contemplating the idea that they should simply be left in place and that the funds should be made available so that they can do what they like with them for another 20 years. Accordingly, in 20 years' time, we will be considering legislation that was framed on a temporary basis and intended to last four and a half to five years, but will have been around for 50 years—and Ministers will be continuing to spend the money. Why are Ministers so happy to extend the power and for it not to be subject to more regular scrutiny? The answer is that the legislation was phrased in such a way as to be virtually an enabling power allowing them to spend whatever they like for whatever reasons they like, subject nowadays to the agreement of the European Commission.
    Mr. Bercow: Given the desirability of avoiding the incentivisation of the subsidy junket, has my hon. Friend made any assessment of the displacement effect of the financial assistance in deterring other productive investment? Does he agree that, in the next few years, we should be more effective in the private sector at reacting to the changing economy in terms of employment patterns and new investment? We should not continually need such a function to be carried out by the state.
    Mr. Lansley: My hon. Friend makes a good point. Ministers have always professed to aim for a competitive market economy free of subsidies, which distort the markets to which they are provided and the businesses from which the money is taken. We examine the latter point too rarely. The Bill's object is to enable the Government to spend £3,700 million on pretty much

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    whatever they like. The distorting effect of taking £3,700 million out of the pockets of British industry in the shape of one company to spend it on another is rarely taken into account. The opportunity cost and industrial disruption that high taxation causes are becoming increasingly apparent to business. [Interruption.] As my hon. Friend the Member for Blaby (Mr. Robathan) says from a sedentary position, business knows that well this week because of the way in which the process affects pay packets and employers' costs.
    The Government may claim that the national insurance increases are to pay for the national health service. Perhaps they will tell us precisely out of which business taxation the £3,700 million will come. Business representatives could then make a more balanced judgment about the merit and amount of expenditure under the schemes, as compared with the disruptive, distorting and damaging effects of the taxation to gain the money. My hon. Friend the Member for Buckingham (Mr. Bercow) happily distracted me from my purpose and I shall therefore revert to my more mundane task of trying to ascertain the origin and destination of the figures.
    On Second Reading and in Committee, the Minister tried to explain that the Government simply took the cumulative total expenditure of £2,700 million under the 1982 Act and rolled it forward, with a gross domestic product deflator for 20 years. The number of years is arbitrary. The Government have simply decided that, since the 1982 Act lasted for 20 years, the Bill might as well last for the same time. Does it make sense simply to roll forward a previous figure? Is the figure in the Bill an accurate reflection?
    I confess that I am not a mathematician and I have not had the time or the opportunity to go away and consider carefully the effect of a 2.5 per cent. GDP deflator on £2.7 billion. The Minister implied in some of his remarks that £2.7 billion, deflated by 2.5 per cent. for 20 years, equals £6.1 billion. I am not sure that that is correct. The figure is more likely to be £4.5 billion. If I did a net present value calculation, a figure of approximately £4.5 billion would be right.
    The Minister will correct me if I am wrong, but I believe that the Government have taken the figure of £2,700 million, discounted it for the 20 years of inflation ahead, reached the figure £4,500 million, decided that it was too large and that the period before Parliament had to reconsider it would be too long, and therefore discounted it to £3.700 million. They then added the £800 million left over to what would otherwise be tranches of £400 million and were in excess of the figure that they had reached. A net present value of £200 million is more or less the same as a discounted figure of £400 million in 20 years.
    Ministers are not only asking us to endorse the effective doubling of the cumulative total for the benefit of inflation so that it can all be spent in the next 20 years, but are offering us four additional tranches, which have been added to the sum. In 20 years, the money that has been spent will be significantly more in real terms than the sum for which the Bill provides.
    I confess that my comments are complicated and that I should have done my mathematics before I arrived, but I suspect that I have accurately outlined what has happened. In a sense, it is neither here nor there, because
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    the calculations refer to funny money. They are statistical calculations, but the point is that the Government plans mean spending the substantial sum of £3,700 million in the next 20 years. That is £170 million a year and means maintaining the current rate of spend for the whole 20 years. There is no suggestion of any substance that the Government believe that it might be desirable, over time, to reduce expenditure.
    The Government show no recognition of the necessity to move to more competitive markets over time. For example, £450 million will be spent on the urban post office reinvention programme—I know, before I am reminded, that it should be called the urban post office closure programme.
    Mr. Andrew Robathan: The figure is £210 million.
    Mr. Lansley: It always used to be £450 million; presumably the figure has decreased.
    6.15 pm
    Mr. Robathan: The figures are: £210 million for urban reinvention; £450 million for rural post offices; and £15 million for urban deprived post offices.
    Mr. Lansley: My hon. Friend is always reliable. I cannot remember which figure applies to the section 8 money. I presume that it is that for the urban post offices closure programme. The Government cannot keep spending the money year after year. When they have spent the section 8 money on the urban post offices once, the process is completed, and they cannot close post offices all over again. Perhaps the Government can; they close hundreds of post offices every year.
    There must be a limit to the number of industries on whose restructuring or closure the Government propose to spend section 8 money. Governments have used such legislation for 30 years and they propose to use it for another 20 years. If they want to do something substantively different from introducing a measure whose purpose is not to allow Ministers to spend what they like on restructuring industries, but to promote research and development in industry or small business regeneration, they should do that. Such a measure should be tighter and more directed towards the effect that it wishes to achieve.
    I am tempted to make comments that are better expressed on Third Reading. I shall therefore avert later to the way in which the money is spent and the range of the DTI schemes, of which section 8 schemes form a part. The Government continue to fail to provide us with information about restructuring section 8 and other DTI schemes, yet we are asked to support the Bill.
    I urge hon. Members to accept that simply rolling forward the measure for 20 years is untenable. Ten years is a far better basis on which to expect a return to Parliament for primary legislation. Four or five years—early in the next Parliament—is a better point at which it would be right for Ministers to secure the ability to add to their expenditure powers. The total amount of money is £4,644 million. Even my amendment would allow nearly £1,750 million to be added to the amount that Ministers will spend. That is a more modest and

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    responsible amount of additional empowerment for expenditure than the £3,700 million that the Government propose.
    Mr. Hopkins: I welcome and warmly support the Bill and I oppose the amendments tabled by the hon. Member for South Cambridgeshire (Mr. Lansley). The hon. Gentleman is trying to tie my hon. Friend the Minister's hands, and I want to give him a freer hand. The hon. Gentleman suggests that the amounts involved should be halved and that the timing for introducing new tranches should be constrained. Therefore, in a crisis, if my hon. Friend wanted to release more money more quickly, he might be unable to do so, and we would regret that at such a time.
    Mr. Bercow: Given that the Department of Trade and Industry has accepted the principle of the sunset clause to the extent that it included such a clause in the Electronic Communications Act 2000 during the previous Parliament, what objection does the hon. Gentleman have, in principle, to the incorporation of such a clause in this piece of legislation? If the case is strong enough, surely the Government can come back and get a decent hearing from Parliament. Of what is the hon. Gentleman afraid?
    Mr. Hopkins: I thank the hon. Gentleman for his intervention. My hon. Friend the Minister will answer for the Government and the Department of Trade and Industry, but I am happy to take a much more relaxed approach to these matters. I would not necessarily have a sunset clause in legislation such as this. I would like to see Governments given a freer hand in relation to the extent to which they can provide assistance to industry at times of industrial modernisation or economic difficulty. I could be described as a more old-fashioned socialist than some of my more modern friends.
    Mr. Lansley: Further to the point made by my hon. Friend the Member for Buckingham (Mr. Bercow), the whole point is that, when this legislation began, it had a sunset clause. It was all going to stop at the end of December 1977, yet we are debating it now, some 26 years on, and the sunset clause was done away with.
    Mr. Hopkins: The hon. Gentleman mentioned that the original legislation was meant to last for a transitional period during our entry to the European Union, or the Common Market or whatever it was called at that time. I was very pleased that the Labour Government of the 1970s sprung the legislation forward and took what was a good idea and carried it on. That is what we are doing now. The hon. Gentleman laughs, but it was a Conservative Government who brought forward the legislation in the first instance. I suspect that that Government did not have quite the same political flavour as the present Conservative Opposition, but they were certainly called a Conservative Government. I welcomed the Bill then, I welcomed the Labour legislation that followed it, and I welcome this Bill now.
    The Government have done a good job in skirting round the constraints of the European Union, because state aids are now very tightly circumscribed by
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    European legislation. When there is scope to use appropriate state aids, I believe that the Government should do so. They have, indeed, carried on with the Bill. I understand that it was at the Berlin European Council that they negotiated the scope for continuing such state aids until at least 2006.
    I have two reasons for believing that the Bill is important now. First, it is clear that, in spite of my right hon. Friend the Chancellor's optimism about our economy—one hopes that it is well founded—world conditions are certainly more difficult at the moment. We are looking at something of a downturn in the world economy. In those circumstances, Governments have to have instruments with which they can at least assist their own economies in such difficult times. One hopes that times will not be too difficult for this country. Indeed, we are better placed to face the future than almost any other developed country in the world, and one hopes that these happy circumstances will continue. The world economy is bound to have an effect on our own economy, however, and we want to give our Ministers and our Government as much scope as possible for providing appropriate assistance to our economy during such times.
    The other concern that I have—the reason that I am against the amendments—is that we cannot predict the consequences of the enlargement of the European Union. At the moment, we receive certain payments from the EU in respect of structural funds, but, inevitably, with the accession to membership of the EU by many countries that are much poorer than ours, there is bound to be a major shift in the fiscal transfers across the EU. It is probable—indeed, I would say certain—that we will be net losers at that point. I think that that is appropriate, in that we are one of the richer countries of the European Union, and there will inevitably be some transfers to poorer nations.
    At that time, such transfers might have an impact on our economy and our industries, particularly in those regions that currently receive structural fund assistance, and we will need more scope for Government intervention to assist those regions and the businesses in those regions. The Bill will provide a basis for doing that. It is, therefore, a good thing that we are introducing the scope to provide substantially greater sums to assist the needy parts of our economy. Indeed, I believe that we could go further.
    Mr. Lansley: I am grateful to the hon. Gentleman for giving way again; he is being very courteous. I would be slightly worried if the Minister were to endorse his argument even for a second, because if the European Commission were presented with such an argument for section 8, it would simply strike the whole thing out. The measure, in its current form, should not be available to provide competitive subsidies for UK businesses to compete in the single market. The restructuring involved should not impact adversely on the single market. Furthermore, if such restructuring is related to specific regions, it should be covered by section 7 rather than section 8.
    Mr. Hopkins: The European Union is well aware of this legislation, and well aware of what our Government have done to provide appropriate assistance to our economy from time to time. I would suggest that other

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    members of the European Union have caused greater offence to the principles of the EU. For example, when France attempted to subsidise its state airline, it caused much more upset than a modest measure such as this would do. I suspect that the spirit of the European Union's competitive philosophy is adhered to more strongly by our Government than by many other EU Governments. I do not, therefore, have any fears that the EU will be upset by the Bill.
    I was about to make the point that I would like the Bill to go further. It is a relatively modest Bill and it could be improved by increasing the numbers still further. However, I do not imagine that my right hon. Friend the Chancellor would want to give me the opportunity to spend his money willy-nilly. I would simply encourage him in that direction, and hope that, in future years, he will be more inclined to provide appropriate assistance to our economy in this way and in others. I shall leave that argument there.
    I emphasise that I do not speak for the Government. I speak for myself as a member of the Government party. I am just trying to encourage my Minister to go further even than the Bill suggests, and to reject the constraining amendments tabled by the Opposition.
    Mr. Henry Bellingham: I am most grateful to my hon. Friend the Member for South Cambridgeshire (Mr. Lansley) for tabling the amendments. He has a huge amount of experience in these matters, he is very highly regarded—after all, he worked in the DTI for a while—and he is an expert on this subject. As he pointed out, the new limits were chosen by means of a 20-year roll-forward of the existing limit of £2.7 billion in real terms, using a 2.5 per cent. GDP deflator. The Minister explained on Second Reading that, based on current spending and assuming that the rate remained constant, the new ceiling would last for six years before the first order would be needed, with increases by order every four years after that.
    That is the nub of the issue, because, in spite of the claim in the DTI's briefing note that the new regime would lead to more parliamentary scrutiny, the reverse will be the case. It based the claim on the premise that it was 14 years before the first order was needed in 1996. Of course, the 1982 Act was a new initiative that set a brand new ceiling of £1.9 billion. To be honest, the previous Government would have had to spend at an unbelievably frenetic and furious rate to have hit the ceiling before 1996, when the first tranche was needed.
    6.30 pm
    As the Minister will be aware, the three orders after that came hard on the heels of each other. The first came in 1996, followed by others in 2000 and 2002. Of course, another was introduced only the other day, which means that, during the past seven years, Parliament has had the chance to scrutinise the 1982 Act every 20 months. That compares favourably with the 4.5 years, or 54 months, anticipated under the new Bill's regime, however, so accountability is the issue and my hon. Friend is absolutely right.
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    If we have to wait six years until the House has a chance to scrutinise what has been going on, that will be far, far too long, which is why I tabled a commencement and continuance enforcement clause in Committee. The Secretary of State would have had to bring the matter back to the House every two years or the legislation would cease to have effect. My hon. Friend's amendment would have roughly the same outcome, which is why we will support him if he forces it to a vote. We must try to increase scrutiny and accountability.
    Another point is highly relevant to the debate, and it concerns the Secretary of State's business support review, which obviously includes many section 8 schemes. I do not know the state of play, but perhaps the Minister will give us another update, as the review involves all the industry and business support measures operated by the DTI. A number of important changes may be recommended and some schemes could be abolished, reconfigured, finessed or whatever, but what, for example, would be the case should the Secretary of State decide to abolish some section 8 schemes?
    That is not completely improbable, and if it happened the Minister may have trouble spending taxpayers' money under section 8, despite his keenness to do so, within the six-year period. In such circumstances, the date of the debate on the first tranche could be pushed back further than six years, so it might be seven or eight years before the House has a chance to consider the legislation, what is happening under section 8 and the 1982 Act. Accountability would be reduced still further.
    It is quite possible that various changes may be made to some section 8 schemes when the Secretary of State completes her review. We have pushed hard for an early look at such schemes, particularly those involving venture capital. I ask the Minister to address our concerns, especially on venture capital funds and, for example, the UK high-tech fund and the early growth funding programme, whose first fund, the London seed capital fund, was launched in December last year with a £2.65 million investment from the Small Business Service. It may eventually build up to £50 million.
    A lot of money is going into those schemes, and I simply submit that the Opposition are not convinced that the Government should be in the business of trying to pick winners and acting as a substitute for this country's mature, enlightened and proactive venture capital sector. It does a superb job and the Government should not be in that space at all. If the Secretary of State takes our advice, some of those schemes—perhaps the two or three that I have mentioned—will be seriously reviewed, which could immediately take out quite a tranche of the section 8 funding.
    It could be 2010 before the House considers what has been going on, holds the Government to account and scrutinises them, which is why I support what my hon. Friend is trying to do. If we do not have a vote this evening, we will return to the issue in another place, because although we support the principle of what the Government are trying to do and although we would find it difficult to vote against some schemes, including the urban post office reinvention scheme, we feel strongly that we are considering a large increase in the amount of money in the well, as the Minister calls it. The ceiling is being increased substantially as are the

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    tranches, but accountability and scrutiny are to be reduced. That is why I urge the House to support my hon. Friend.
    Dr. Vincent Cable: May I say a few words in support of the amendment, which is eminently sensible and modest? It is perhaps too modest, but it is still well worth supporting.
    I regret that I did not participate in Committee. Obviously, there are occasions when we all miss a Committee for reasons of double booking, forgetfulness or constituency engagements, but neither I nor my hon. Friend the Member for Weston-super-Mare (Brian Cotter) was informed about the Committee. When we discovered that it had taken place, we went back over the records and discovered that we had received cards inviting us to proceedings on something called the international development Bill.
    A mistake had been made, which was subsequently rectified through the Government and Conservative Whips Offices, but not through ours. The Bill is modest, but it is important and I would not want the Minister and other Members to think that the fact that I was not present, which I regret, reflects any lack of interest in it.
    On the substance, I argued on Second Reading, and do so again, that the problem with the Bill is that the sums are too large, too long a period is involved, the tranches are too big and there is a lack of accountability. The measures built into the amendment seem sensibly to address that, however, and I want to make three substantive points. Most of them have already been made, but I want to add emphasis.
    First, the rather lazy assumption is being made that, because we have been spending a large amount on industrial assistance for the past 20 years we should continue to spend it for the next 20. Why should we make that assumption? A few moments ago, the hon. Member for Luton, North (Mr. Hopkins) addressed the issue by saying that we need a reserve facility in case of crises, but the problem with that argument is that one is more likely to try to sort out a crisis with public money if it has already been allocated.
    Mr. Hopkins: Does the hon. Gentleman agree that when there are inevitable occasional downturns in the economy, the time to ensure that the investment goes in and new businesses are encouraged to start is on the upturn? Indeed, those occasions sometimes happen in concentrated time spans, so one needs instruments to be available at that time.
    Dr. Cable: There is an argument for counter-cyclical management, but that is not the argument that the Government have advanced.
    Mr. Hopkins: It is my argument.
    Dr. Cable: I realise that, but I am not sure that such legislation is necessary even if we have emergencies. A few weeks ago, we had the example of a major crisis in the British nuclear power industry. I was one of those who opposed the bail out, but, even without recourse to such legislation, the Government were able to take
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    legislation through Parliament within weeks and it was closely scrutinised, as it should have been. That, surely, is the way to deal with an emergency, rather than having open-ended facilities such as those in the Bill.
    There is also the question whether we should continue to see such industrial assistance as necessary. The hon. Member for South Cambridgeshire (Mr. Lansley) made those points today and has done so previously. The industrial development system was seen as important, particularly in the 1980s, because we had labour-intensive, highly concentrated industries such as coal, steel and shipbuilding with a real need for adjustment assistance, but they have largely gone—the process may have been brutal—and they will not recur. Such traditional industrial assistance has largely passed.
    Industrial assistance was also seen as necessary because of specific market failures. We should particular examples where legislation has been used to disburse large sums of money. We must ask why we should assume that such market failures will continue indefinitely. One of the examples is the use of venture capital financing. In the past, a strong argument has been made that the British venture capital market was deficient, particularly at the smaller end. As I follow it, however, the venture capital institutions have advanced considerably. It is not at all clear whether, in the next 10 to 20 years, the same need will exist that exists today.
    More importantly, there is the issue of banking. The small industry loan guarantee scheme, which was generally welcomed by all parties, arose from a specific analysis that the banking system was defective in providing loans to medium-sized business, and charged an excessive risk premium to them. After that assumption was made, the Government conducted a full analysis, in the form of the Cruikshank report, which addressed that specific failure. Some of us have been frustrated that the Government have not followed through the Cruikshank report's conclusions—I secured an Adjournment debate on the matter—and that they have still not addressed the issue of the payments regulator. None the less, I do not understand fully why we should assume that, for the next 10 to 20 years, there will be a deficiency in the ability of the banking sector to lend to small business, and why the scheme should continue indefinitely.
    My third substantive point, which I made on Second Reading, and which I will repeat, is that to justify this level of commitment we need a more rigorous system of evaluating the expenditure that has already been made. I appreciate the Government response, and the Minister has been very courteous in following up the comments made on Second Reading, particularly with much detailed information on the small loan guarantee scheme. None the less, I sense in this whole area an absence of rigour in the way in which funding is evaluated. Little attempt has been made to establish what difference such assistance would make to companies, or, as the hon. Member for South Cambridgeshire put it, to examine the opportunity cost. The £3.4 billion could be spent on education and skills or on transport facilities, which could raise the productivity of British industry, and probably more so than spending through this Bill. Who will ask those questions, however, in relation to the rigorous evaluation needed to make a sensible assessment of the legislation?

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    I remain very doubtful about the Bill. I welcome the attempts to establish a greater degree of accountability, and I will therefore support the amendments if they are to put to the vote.
    The Minister for Employment Relations, Industry and the Regions (Alan Johnson): I welcome the debate. This is a very small Bill, on which I did not expect to spend much time, but the time has been well spent. We have heard some very constructive comments and, as the hon. Member for Buckingham (Mr. Bercow) said, some history lessons. I was grateful to the hon. Member for South Cambridgeshire (Mr. Lansley) for taking me back, with names such as Chris Chataway and John Davies, to the days of flares and tank tops in the glam rock era of British parliamentary life of the 1970s.
    The hon. Member for South Cambridgeshire said that the Bill had not received sufficient scrutiny. That is wrong: we have subjected it to a great deal of scrutiny. He departed from his normal eloquence by saying that it was not "examinated" properly, but I think that it was examinated properly. The amendments may be different, but our basic argument has been about whether the Government are being profligate with taxpayers' money in business support measures under section 8, whether we are seeking to avoid proper parliamentary accountability and whether we should be coming back more often for extra tranches of money. All those are covered in the amendments. As I explained in Committee, we want to strike a balance between retaining the concept of parliamentary control and bringing the limits in the Industrial Development Act 1982 up to date to take into account the growth in the economy since 1982, without making the process too burdensome for Parliament. The limits proposed in the Bill reflect that objective.
    The hon. Gentleman said that the effect of the two amendments taken together would be to make three changes. I think that there is a fourth. He said rightly that they would set a new initial ceiling of £3,440 million—not too wildly dissimilar from ours of £3.7 billion—and I understand the logic of using £185 million, which is our forecast spend, to reach that figure. I will not therefore fall to the floor sobbing about that change, but we think that £3.7 billion is more sensible than £3.44 billion. He suggests six tranches of up to £200 million, whereas we propose higher tranches of £600 million—we rejected the Treasury proposal.
    6.45 pm
    There is one consequence, however, that he did not mention specifically: under the amendment, the legislation would expire about 10 years earlier than provided for by the limits in the Bill, and would halve the expected life of the new legislation. That is based on taking the average of the forecast spend for the four financial years, 2002–03 to 2005–06, and the assumption that the rate of spend of £185 million per year remains constant over subsequent years, once we have reached the current limit of £2.7 billion early next year.
    We propose a longer-lasting piece of legislation, subject to periodic scrutiny by Parliament. We discussed in Committee how long Parliament had spent scrutinising the Bill. We made the point that, on average, parliamentary debates have taken place every
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    five years, and, on average, have lasted less than half an hour. The hon. Gentleman feels strongly about these issues, but all the evidence is that the amount of parliamentary scrutiny that we give to section 8 of the Industrial Development Act is about right. There is no evidence that not enough time is available for such parliamentary scrutiny.
    An estimated period of six years would seem appropriate for the initial limit to last, bearing in mind the scrutiny that we have just had in this place and another place. The effect of the limit proposed in the Bill would mean that we would return to the matter after six years, given that Parliament will have had opportunities for detailed scrutiny during its passage.
    As I have explained, the hon. Gentleman was absolutely right—he may not have done his sums in advance, but he did them correctly—that we could have gone for a higher initial limit of £4.5 billion, but we chose not to do so. That is based on rolling forward the existing limit of £2.7 billion in real terms—using the famous 2.5 per cent. figure as a proxy for the long-term GDP deflator—for a 20-year period, which would have given a ceiling of £4.5 billion, and four subsequent tranches of up to £400 million. We have set a lower initial ceiling of £3.7 billion, however, and bigger tranches of up to £600 million each, resulting in the same ultimate ceiling of £6.1 billion.
    Amendment No. 4 proposes that the tranche sizes remain at £200 million. As I argued in Committee, however, prices have more than doubled since 1982, increasing by a factor of 2.2. That would have the effect of almost annual parliamentary scrutiny of the use of section 8. After the first order, the three subsequent orders would be needed every 12 to 15 months. I accept that that is a difference between us, but we believe that that is not a proper use of Parliament's valuable time. It would be too restrictive to retain the tranche size at £200 million, and, significantly, to introduce a requirement that not more than one affirmative order in a 12-month period could be made, as amendment No. 4 proposes. That would mean that not more than £200 million could be spent in any 12-month period: in effect, a ceiling on the annual rate of spend, which would introduce a completely new concept into the Bill and, indeed, into the 1982 Act.
    Forecast expenditure for the current uses of section 8 for the current financial year and the next, however, exceeds £200 million. In the financial year that has just started, we predict that we will need £208 million, and, in the following financial year, £221 million. In the financial year just gone, we budgeted for £160 million but used £130 million.
    The amendment would have serious consequences. It would mean that the limit available to us would be exceeded by the schemes. Apart from some mild criticism about venture capital funds, all the evidence during all the scrutiny—we have had three orders since 1997—has not suggested huge controversy about the way we are spending the money. The amendment would prevent us from being able to do that.
    There is no rational basis for saying that no more than £200 million should be spent in any one year. It is in the nature of schemes that expenditure fluctuates from year to year. The amendments would be unnecessarily burdensome for the House and could disrupt DTI

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    spending plans on longer-term business support such as the small firms loan guarantee scheme, which we expanded last week—we announced last November that we were expanding it. It could also disrupt the plans of other Departments and the devolved Administrations, who also use the facility of section 8. The Government's proposals represent a far better balance between scrutiny and efficiency.
    I pick up two important points made by hon. Members, including the hon. Member for North-West Norfolk (Mr. Bellingham). The first relates to an update of the business support review. My right hon. Friend the Secretary of State will be writing to members of the Select Committee on Trade and Industry and to all other hon. Members when we have finally worked out how it will operate. However, we closed 20 schemes last week. We will close 84 schemes by the end of this year. None of the section 8 schemes has been affected, apart from the expansion of the small firms loan guarantee scheme that I mentioned in Committee, which was widely welcomed, including by the hon. Member for North-West Norfolk. No other section 8 schemes have been affected by recent developments under the DTI business support review.
    The second point that was raised—it has been raised before—was about venture capital and the fact that we have such a mature venture capital fund market. Hon. Members have asked whether we really need those schemes. The evidence, not least from the British Venture Capital Association, is that venture capital companies have moved relentlessly up the value-added chain and are now more involved in management buy-outs or management buy-ins. The latest BVCA report on investment activity in the UK shows that only 3 per cent. of total private equity investment was at the start-up stage in 2001 and only 8 per cent. in early-stage investments. In comparison, management buy-outs and management buy-ins accounted for 60 per cent. of the spend of venture capital funds. Organisation for Economic Co-operation and Development figures indicate that, despite having a much larger private equity industry in total, UK private equity investment in early-stage companies as a proportion of GDP is relatively low compared with other OECD countries.
    Therefore, there is a need for the venture capital fund schemes that we have, although I have accepted, and I will say it again on Third Reading, that we need to report on the matter more fully and to give hon. Members the chance to see how schemes are faring, as we did in the KPMG report on the small firms loan guarantee scheme as recently as 1999. We need to do much more and I have accepted those points.
    We believe that the Bill as currently structured offers the best basis for providing continued support for industry as well as accountability to Parliament. Therefore, I hope that the hon. Member for South Cambridgeshire will withdraw his amendment.
    Mr. Lansley: I will not detain the House too long because we have the opportunity to make further points in relation to the Bill generally on Third Reading. I thank the Minister for responding to the debate. I know that he covered similar issues in Standing Committee but, not least by virtue of the presence of the hon.
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    Member for Twickenham (Dr. Cable), we have benefited from the further debate about the specific numbers in the Bill. We elicited from the Minister a rather damaging admission that the Government's intention is for expenditure to go above £200 million and above £220 million. In his view, it may damage the argument for amendment No. 4, but in my view it reinforces the argument for the amendment.
    We are dealing with legislation that was always intended to be for an exceptional purpose and over a transitional period. It has been appropriated by Ministers, in some cases correctly, as a mechanism for providing support to industry. I heartily endorse the points that were made by the hon. Member for Twickenham that far too little scrutiny is being given to the underlying question of whether Ministers ought to have a power to spend in this way. There is far too much recourse to section 8 as an omnibus mechanism for paying out money for various schemes. The fact that it is being used for the closure of post offices demonstrates that it is simply a well, as the Minister is fond of describing it, of money into which Ministers are want to drop their bucket for all sorts of purposes that do not necessarily have appropriate parliamentary scrutiny. It seems all the more obvious that we should come back to Parliament more regularly to examine what is going on. If we are not doing it on the basis of scrutiny of annual reports, we should do it on the basis of scrutiny of regular orders to add to the sums of money that are available to Ministers.
    It is purely a matter of judgment as to whether the first of the orders should happen in six or four years' time, and whether the length of the further extension of spending power should be 20 or 10 years. I do not resile from my view that 10 years is a perfectly sufficient—in fact, rather generous—length of time, during which Ministers should be free to spend only with affirmative resolution scrutiny of their powers from Parliament.
    My mechanism would at least have meant that, at the present rate of spend, Ministers came back before the House early in the next Parliament, whereas they may come back at a later part of the next Parliament. We shall see when that happens and who it is who does it, but I hope that Ministers, whichever Government they serve, will begin—perhaps not least because we have spent some time arguing our points in these debates—to think far more rigorously about section 8 as a legislative framework for the expenditure of the DTI. It is long overdue for the DTI to think again, to restructure its legislative framework and to find a more modern definition of what the DTI's purposes are, rather than resting on one that is about the restructuring of the smokestack industries of the 1970s.
    I do not want to let down my hon. Friend the Member for North-West Norfolk (Mr. Bellingham) or the hon. Member for Twickenham but, notwithstanding their generous support, I do not propose to pursue the amendments to a Division. Ministers and my colleagues have had plenty of opportunity to express their views. I hope that they will be regarded with seriousness. On that basis, I beg to ask leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Order for Third reading read.
    6.58 pm
    Alan Johnson: I beg to move, That the Bill be now read the Third time.
    The Government believe that we can best support business by encouraging its competitiveness and creating a favourable climate in which it can operate. We believe that financial assistance has a part to play in that, where it will drive up productivity and where there is clear evidence of market imperfection.
    It is a small, modest Bill of just two clauses, but it is essential to enable the section 8 power to continue to be used to give financial assistance to industry for the purposes specified in the 1982 Act. The Bill will increase the cumulative limit on financial assistance that may be provided under section 8 of that Act. The Bill retains the accountability to Parliament contained in the existing legislation through the need for affirmative orders of the Commons. It replaces the existing limits with new, higher ones reflecting the growth in the economy over the past 20 years, without making it too burdensome for Parliament. We want to strike a balance between retaining proper parliamentary control and bringing the limits in the 1982 Act up to date.
    A transformation of the DTI's business support activities is under way, and eventually all existing business support schemes will be run down, including the eight Small Business Service schemes set up through the use of the section 8 power. New products will be introduced, some of which will incorporate the best elements of existing schemes. We have begun to roll out the new approach to business support with the release of the first of the new products on 1 April. This included the launch of the new extended small firms loan guarantee. Further products will be released over the coming months, and announcements will be made by the Secretary of State.
    We need the new limits in place to ensure a legislative base for existing schemes, as do Secretaries of State and Ministers in the devolved Administrations, who are able to use section 8 to fund their own activities. Without the introduction of new limits, the legislative basis for the current section 8 schemes would be exceeded when the £2.7 billion limit that is allowed for by the 1982 Act is reached—we forecast that that will happen early next year—rendering unlawful further use of this power by Ministers.
    I am pleased that hon. Members on both sides of the House have been supportive of the Bill's main aim, which is to allow financial assistance, under section 8 of the 1982 Act, to continue to be offered to industry throughout the UK Even though the Bill has not had a detailed or lengthy passage, it has certainly undergone scrutiny on Second Reading and in Committee. In addition, section 8 was the subject of a Standing Committee debate last month, in order to raise the ceiling for a fourth and final time under existing legislation.
    I am grateful for the constructive approach that Opposition Members have taken, and I hope that they feel that, for the most part, the Government have listened to their views and taken action on many of the issues that they raised, even if the proposed amendments and new clauses were not accepted. In response to their comments, I have committed to including more detail on each section 8 scheme in the future annual reports
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    required by the 1982 Act, and to including the conclusions of any explanations published in the reporting year. My officials are already taking forward this initiative for the 2002–03 report. Moreover, I wrote to those who spoke on Second Reading and in Committee, outlining progress on the current DTI section 8 schemes since the annual report was published for the year ending 31 March 2002.
    I cannot commit to laying the annual report before the House much earlier than we currently do. It takes time for the information and statistical data to be gathered from throughout the DTI, as well as from other Departments, devolved Administrations and regional development agencies. The 1982 Act requires an annual report to be laid before Parliament

    "not later than six months after the end of the financial year to which it relates".

    By laying the report before Parliament in June or July each year, we are fully meeting the requirement laid down in the 1982 Act.
    I also said that I am in full agreement with Members about the importance of the evaluation of schemes. Following the DTI's review of business support, in future all the Department's business support products, including measures that use section 8 as their legislative base, will be subject to ongoing monitoring and analysis to measure whether they have achieved their objectives and offered value for money. Evidence from this analysis will help the newly formed investment committee to target business support funds where there is a clear rationale. It is expected that this evidence will be published in full.
    With these assurances, I commend the Bill to the House.
    7.3 pm
    Mr. Bellingham: I shall be brief, obviously, and I should begin by declaring my interests, which are listed in the Register of Members' Interests.
    We support the principle of this Bill, and we certainly accept the need for some industry-specific intervention—after all, the original Act was ours. I do not accept the comment of my hon. Friend the Member for Buckingham (Mr. Bercow)—albeit from a sedentary position—that it was among the worst of the legislation that we introduced. [Interruption.] Well, it certainly numbered among our better legislation. Indeed, if one looks at the good that has come out of it—the number of jobs saved, and the number of schemes that have brought substantial business success—one can conclude that it is very good legislation.
    There has been considerable debate about the different ceilings and tranches and the need for greater scrutiny, and I do not doubt that there will be further debate on those issues in another place. The same applies to the points that I made about the business support review. The Minister did not give a satisfactory answer to the questions that I posed. If that review comes up with various fairly significant and far-reaching conclusions, the actual date for initial scrutiny under the legislation could well be pushed back beyond the six-year period. He did not deal with that point, and hopefully it will be re-examined in another place.
    I am very grateful to the Minister for what he said about trying to improve the level of reporting on the different schemes. As he pointed out, KPMG produced

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    a very good report on the small firms loan guarantee scheme, which we all appreciated enormously. It added a great deal of material, and contributed to wider knowledge of that scheme. Why cannot the same be done in respect of many of the other schemes under section 8, particularly those carried out by the Small Business Service?
    The Minister said that it would be unrealistic to bring forward the annual report any further. I take on board entirely the point that, under the legislation, the report has to be published within six months of the end of the financial year. However, in the light of modern IT and the information retrieval systems that the Minister has at his disposal, surely it is not asking too much for the report to be published within four weeks of the end of the financial year, say, probably in May. We need to know exactly what is going on, particularly given the extra money that the Government will be spending. So perhaps the Minister could have a look at that issue.
    We had a good discussion about the small firms loan guarantee scheme on Second Reading and in Committee. It is a flagship scheme and, as the Minister pointed out, to the end of January this year almost 84,000 loans averaging £37,000 had been guaranteed, totalling some £3.24 billion. On Second Reading, we debated the problem whereby some sectors do not qualify for the scheme. The Minister pointed out that the Minister with responsibility for small businesses—he was here earlier this afternoon—has announced that some of the sector restrictions have been lifted. In fact, I understand that the scheme has been expanded to include, for example, retailing, catering, coal, hairdressing, libraries, museums, motor vehicle repair and servicing, steel and travel agents. However, what about education schemes and medical health services—the two sectors for which I pushed for inclusion very hard? They appear not to have been included, but they certainly should be.
    I want to say a brief word or two about the urban post office reinvention fund, which was introduced to deal with the fallout from the proposed implementation of automated credit transfer. As my hon. Friend the Member for Blaby (Mr. Robathan), who is shadow spokesman for Post Office matters, pointed out, the total fund committed is £210 million, of which £180 million will constitute straightforward compensation, with £30 million going into matched funding schemes. Presumably, the £15 million that will come from the Office of the Deputy Prime Minister is not covered under section 8, and will actually come from that Department. Perhaps the Minister knows the answer to that question. The chairman of the Post Office, Allan Leighton, pointed out in a speech of 14 November last year that some European money would be brought in to match the money coming in under section 8. He presumably knows what he is talking about, or perhaps it was simply wishful thinking on his part.
    We are looking at the law of unintended consequences. The Government worked out that a fairly juicy saving could be made by moving over to automated credit transfer. I understand from my hon. Friend the Member for South Cambridgeshire (Mr. Lansley), who is very experienced in these matters, that the total potential saving to the Department for Work
    80
    and Pensions is in the region of £430 million. That may sound like a significant sum, but in the light of how those savings will be made—mainly through clawing back payments made to sub-postmasters—one needs the urban post office reinvention fund, and that is to say nothing of the money that will be put into rural post offices. So through the law of unintended consequences, one part of government is looking at a juicy sum that can be saved, and another is simply coming to the rescue of the victims of that ill-thought-out scheme.
    The post offices in my constituency do not have enough information to hand at the moment. Many people are asking for details of how to have their benefits or pensions paid into bank accounts. I have recently received many letters from constituents telling me that many post offices do not have the information available. Perhaps the post offices are trying to fight a rearguard action because they do not want people to move over to automated credit transfer. As I said, we are seeing the law of unintended consequences at work.
    We must take the wider economic and industrial context into account. The Chancellor will tell us some good news about employment and inflation on Wednesday, but the Opposition have set out five tests to assess the wider economic context. One test is business investment, which is unfortunately falling at its fastest rate for 36 years. Another test is jobs in manufacturing industry, and 600,000 jobs have been lost since 1997 with the CBI predicting another 40,000 job losses in the next month. We have the biggest deficit in traded goods since 1697, when William of Orange was on the throne—
    Madam Deputy Speaker (Sylvia Heal): Order. The hon. Member is straying rather wide of the debate currently before the House.
    Mr. Bellingham: I am grateful to you, Madam Deputy Speaker, for putting me right, but we have to take the wider economic context into account. I will be brief, but I want to mention two more criteria. First, productivity, which is growing at half the rate under the present Government—
    Madam Deputy Speaker: Order. I have just ruled the hon. Member's comments out of order, so I would be grateful if he would return to the debate.
    Mr. Bellingham: I will, indeed, return to the debate, Madam Deputy Speaker, and I apologise for being over-zealous, but it is important to put the debate into the right context. Unless we consider the grant aid that is available under section 8 within the wider economic context, it does not make much sense.
    The Government should be aware—it is a relevant point—of how the Department of Trade and Industry is regarded. What Business Wants recently carried out a survey—I see you looking a little nervous, Madam Deputy Speaker, but this is relevant to section 8—based on the responses from 600 companies. One question was

    "Does the DTI do a good job at helping UK firms?"

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    In response, 4.5 per cent. said, "Yes, by and large", which is not very encouraging. Another question was

    "Does this Government understand enough about what business needs to thrive?"

    Some 61.2 per cent. said "No, not at all"; and 1.9 per cent. said "Yes". It also asked:

    "Do you think Trade Secretary Patricia Hewitt has a grasp of how business operates and what it needs?"

    We should not forget that the survey was based on the views of 600 companies, ranging from multinationals to small businesses and 47.8 per cent. said "No, not at all".
    Madam Deputy Speaker: Order. Once again, I am afraid that the hon. Member is straying rather wide of the mark for this particular debate. Perhaps he could come back to it.
    Mr. Bellingham: I will come back to order, Madam Deputy Speaker, but only a staggering 0.5 per cent. said yes, the right hon. Lady did understand completely. [Interruption.] It is one business in 200. That shows that, if the DTI wants to justify the different schemes under section 8 and the huge extra expenditure involved, it has to do much more explaining to the business community. There is some potential good will for the different Government schemes, but they need to explain what they are doing much better. On the wider issue, we will come back to the importance of scrutiny in the other place and we shall keep on pressing our points, which were fairly and comprehensively encapsulated in the amendments proposed by my hon. Friend the Member for South Cambridgeshire.
    In conclusion, we support this small Bill, which is necessary, but it needs more scrutiny. In the light of the recent, wide-ranging and important survey to which I referred, we also believe that the Government should explain their case to business more clearly.
    7.14 pm
    Mr. Michael Weir: My contribution will be brief. I expressed some reservations about the Bill and the intentions behind it on Second Reading. Although it has been described as a small Bill that does not achieve a great deal, it is still another step—as I thought then and still do now—in the direction of providing assistance to industry on a sectoral and national, rather than a regional, basis. I think that that is wrong and that it could have important implications for the future.
    I was particularly interested on Second Reading—the Minister referred to it again tonight—in the role of the devolved Administrations in the use of section 8. I followed up my interest with a letter to the Minister asking for further details and I received a full and fairly detailed reply about how the devolved Administrations could utilise section 8 powers without necessarily having to secure Treasury approval. Reading between the lines and after going all around the houses, it appears that there will be little benefit for the devolved Administrations, because no more money will be made available to them. Once again, we come back to the block grant from this place to the devolved
    82
    Administrations, which is decided in advance of any need to utilise section 8 powers. There may not be much benefit from the provision, so it provides another argument for the full fiscal autonomy of the Scottish Parliament. I hope that we will move towards that in the near future. Having said that, the power has been used to good effect in some areas of Scotland. I supported the Bill on Second Reading and I will continue to support it, but with some reservations.
    7.16 pm
    Mr. Lansley: I do not want to repeat what I said on Report, but to make one or two additional remarks about the purposes to which section 8 scheme money is put. I take the point made by the hon. Member for Angus (Mr. Weir). If I do not agree with him about the extent to which expenditure should be made on a devolved basis, particularly in respect of the English regions, I can still recognise a conflict between the Government's expressed intention to devolve budgets to the devolved Administrations—and, in England, to the regional development agencies in a single pot—and their attempt to spend considerable money by assuming powers for national spending through national rather than regional schemes. That is an inherent contradiction in the Government's approach, which the Bill does nothing to resolve.
    My points are straightforward. I do not share the enthusiasm of my hon. Friend the Member for North-West Norfolk (Mr. Bellingham) for the principle of spending Government moneys. It may be a small Bill, but it has a quite a large price tag. By the time we finish, we will have spent just over five hours in the House and in Committee scrutinising the Bill: that amounts to £10 million a minute in relation to the expenditure that the legislation will allow, so our scrutiny is not excessive. The Government fail to acknowledge that in extending the ability to spend—and in making the financial resources available—they have strayed far from the spirit of the legislation, and have in fact used it even more widely in recent years.
    The hon. Member for Twickenham (Dr. Cable) pointed out on Second Reading that in 2001–02 approximately £113 million was spent on section 8 schemes, and the Minister told us earlier that it will increase to £220 million—a worrying acceleration in the rate of expenditure. As my hon. Friend the Member for North-West Norfolk illustrated so well, businesses have little confidence in the way in which the Department of Trade and Industry has spent its money, and at the same time they are expressing rising concern about the extent to which they have to pay taxation in order to fund Government activities. They do not want a merry-go-round in which money goes out of the pockets of successful businesses to be spent through section 8 on subsidising failing businesses. We must ensure that section 8 money is spent well. There is no doubt that the Minister or the Secretary of State will tell the House how 183 schemes will be compressed into 30 or 40, but there is no evidence, so far as section 8 is concerned, of a diminished desire to spend on the part of the Government. If anything, there is an increased desire. It had better be good expenditure.

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    I am not impressed by my personal experience in my constituency of the so-called post office reinvention programme. First, there was an attempt to define the post office at Ickleton, one of the smaller villages in South Cambridgeshire, as an urban post office—
    Madam Deputy Speaker: Order. The hon. Gentleman seems to be straying a little wide of the debate.
    Mr. Lansley: I am grateful, Madam Deputy Speaker, but I am simply referring to the way in which money is being spent under section 8, which the Government want to top-up. The urban post office reinvention programme is precisely the sort of the scheme whose money the measure is designed to facilitate. It seems relevant whether that money is spent well or badly.
    Madam Deputy Speaker: That is fine, so long as we do not get into a discussion about rural post offices.
    Mr. Lansley: I am looking forward to the debate tomorrow in Westminster Hall, in which my right hon. Friend the Member for West Dorset (Mr. Letwin) will discuss rural post offices, a subject close to the hearts of my hon. Friends and me. In Ickleton, those involved ignored where the post office was and persisted in doing so until I practically had to take them there to show them that it was not in the middle of Saffron Walden, as they believed.
    The Wulfstan Way post office, in the Queen Edith's ward in my constituency, serves the southern part of Cambridge and is the closest post office to Addenbrooke's hospital, the principal destination of those working in Cambridge. There is not a post office on the Addenbrooke's site, and there is now a proposal to close the nearest one. Those involved are following a rationale based on which postmasters want to get out of the business and paying for that, rather than restructuring around a rational understanding of markets and businesses. I shall be taking up that matter vigorously with the Post Office; it seems to be an unwise choice.
    I am not expecting a reply now, and we can debate these matters at another time, but it is important that we get an indication of where the Government are going with regard to section 8 schemes. The Minister seems to be saying that there are no proposals to change section 8 schemes under the DTI review of business support. I understand that the Smart scheme, which the Minister knows well, is changing. The feasibility studies that can be part of Smart hitherto have had a possible subvention of up to 75 per cent., or £45,000. It is proposed that that should go down to 60 per cent., although the maximum grant could be increased. The development grant can go up from 30 per cent. to 35 per cent. of the project funding. That is surprising and undesirable.
    Recently, the thrust of science and technology policy has been towards pre-feasibility and feasibility stages and away from the development phase. That is the point at which those promoting their project should expect to provide the funding themselves to a greater extent. It is at the feasibility stage that one should expect Government support and help for people in
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    universities—in my case, the university of Cambridge—to the point at which a business plan can be put together and research validated. That is where the Government ought to be.
    The Government seem to be looking to a smaller number of such schemes, with more money going to the development phase. That is undesirable and I hope that the Minister will have another look at it. There have been something like 80 such schemes around Cambridge. We are pleased to be recipients of Smart money, but it has to be spent in a smart way.
    The Minister wrote to those of us who spoke on Second Reading and responded to a number of questions. The hon. Member for Twickenham (Dr. Cable) said that section 8 would not be used in relation to British Energy or the restructuring of the nuclear power industry. However, the legislation in relation to British Energy was not designed to provide a power to spend money; it was a power to change the way in which the Government occupied their shareholding position in relation to British Energy in particular. The measure, in effect, removed constraints upon spending money.
    I am still slightly unsure about the matter; perhaps the Minister will give an answer now, as I have written to him about it. Where will the money come from for British Energy, as the original guarantee to British Energy's borrowing will run over the year end and will become, effectively, a permanent guarantee? On the face of it, it looks to be the kind of thing that section 8 was designed to do. I am surprised that section 8 is not the vehicle that Ministers have chosen.
    Alan Johnson: First, the legislative basis of the Smart scheme, to which the hon. Gentleman refers, is the Science and Technology Act 1965 and not section 8 of the Industrial Development Act 1982. Secondly, on the use of section 8 for British Energy, we have not decided to use that route yet. However, in terms of the urban reinvention programme, any scheme that exceeds £10 million will be subject to scrutiny by this House. The post office urban reinvention scheme is a bad example in terms of parliamentary scrutiny because we debated it in November of last year.
    Mr. Lansley: I think it was on 15 October, and I remember the debate very well. At that point, we did not have the benefit of seeing how it was working, which we do now. Parliamentary scrutiny in advance is a good thing, but scrutiny in arrears also has its merits. I thank the Minister for his clarification. I should be interested to know where the money will come from and what the statutory cover is for the expenditure on British Energy. However, I do not propose to hold up the House any further.
    I have expressed my reservations about the scale and character of the funding. I hope that Ministers will not simply take the legislative vehicle as an opportunity to spend with abandon, but will think hard about what they are spending under section 8.
    In 1987, when Lord Young was Secretary of State for Trade and Industry, he set up the enterprise initiative, which was geared towards remedying market failures among small businesses. It lasted for three years. The intention was to provide a pot of money that would, in effect, go back to the Treasury, with the DTI stopping

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    doing what it was doing and diminishing its activity. Far from it; every three years thereafter, and every subsequent three years, the DTI has reinvented itself, spending about the same amount of money, using about the same numbers of staff and—in the view of many in business—having the same impact in science and technology. The measure is directed at science and technology this time, but it was small businesses that time and it might be consultancies next time. It is about time that the DTI was much clearer about what it wanted to do and how it was going to do it.
    Question put and agreed to.
    Bill accordingly read the Third time, and passed.

  High Hedges (No. 2) Bill [Money]
  Queen's recommendation having been signified—
  7.28 pm
  The Parliamentary Under-Secretary of State, Office of the Deputy Prime Minister (Mr. Tony McNulty): I beg to move,
  That, for the purposes of any Act resulting from the High Hedges (No. 2) Bill ('the Act'), it is expedient to authorise the payment out of money provided by Parliament of—

  (1) any expenses incurred by the Secretary of State in consequence of the Act; and

  (2) any increase attributable to the Act in the sums which are payable out of money so provided by virtue of any other Act.

  First, I am enormously grateful to be speaking to this money resolution at this hour. I have looked through a previous debate when a ministerial colleague had to wait until five minutes to two in the morning before moving the motion. Secondly, I must offer the House the apologies of my hon. Friend the Member for Ealing, North (Mr. Pound), the proposer of the Bill, who cannot be here this evening. He sends his love and best wishes.
  The motion relates to a private Member's Bill promoted by my hon. Friend. The Government support the Bill; it will bring relief to thousands of people in England and Wales whose quality of life has been blighted simply because they cannot persuade their neighbours to cut back hedges to a reasonable height.
  The measure will give people the opportunity to refer their hedge disputes to their local authority. The local authority will consider whether the hedge causes a serious problem and will be afforded the means to ensure that those bringing cases have exhausted all other channels, thus preventing capricious or vexatious claims. The local authority will be given powers, in appropriate cases, to require the owners of hedges to cut them back to a reasonable height and to ensure that they have done so.
  The Bill also provides right of appeal to the Secretary of State or the National Assembly for Wales against a local authority decision. The complainant as well as the hedge owner can exercise those rights.
  Our assessment of the financial implications of the Bill reflects responses to the consultation held in 1999 and subsequent discussions with local authorities and the Local Government Association. It has been assessed that there is a backlog of 10,000 cases, which would cost £3 million to deal with over three years, and we think that is right.
  I commend the motion to the House.
  7.30 pm
  Mr. Philip Hammond: As the Minister implies, there is general support for the Bill on both sides of the House. The measure has had a long genesis, with the active involvement of Members on both sides of the House.
  It appears that the Government have thrown their weight firmly behind the Bill. We have heard many protestations of their intention to legislate when time allowed. There have been pamphlets, but so far, no legislative action, and the Government have chosen to

  87
  achieve their stated objective by providing support for the reincarnation of a private Member's Bill that has already gone around the loop.
  Will the Minister explain why the Government have decided that a stand-alone Bill is the only way to deal with the issue? Why could not it have been dealt with under the Planning and Compulsory Purchase Bill that he recently took through the House?
  The Government support the Bill and will provide time for it to proceed to Committee where we shall have the opportunity to explore some of the remaining issues and to knock some of the rougher edges off the proposals. It is important to note that the measure will not ban high hedges; it is designed to provide a resolution mechanism when high hedges are the cause of dispute between neighbours.
  Several important issues remain to be ironed out in due course. We need to weigh up the benefits and disbenefits of high hedges. They are often intrusive and cause loss of light and loss of aspect, but they also provide privacy. My constituency postbag is mixed. Some constituents are concerned about the implications for loss of privacy.
  We shall want to probe the necessity for criminal sanctions in legislation such as this. There is a body of opinion that such sanctions are not really appropriate in these circumstances.
  We need to discuss the degree to which there has been prior effort to negotiate before a complaint will be taken up by a local authority. For example, would it be considered appropriate or necessary in certain circumstances for a potential complainant to have offered to carry out the work themselves, perhaps where the landowner is elderly, disabled or otherwise unable to carry out any required remedial work? We are all anxious that the measure should promote negotiation and consensus, although, on Second Reading, the Minister noted that he was not necessarily a fan of consensus solutions.
  We shall need to consider whether objective tests are to be set down, perhaps in a code of conduct. I shall also want to question the Bill's promoter on the definition of high hedges. The Bill specifies 2 m, but if we had been considering the measure 15 or 20 years ago that figure would have been 6 ft or 8 ft. How was the figure of 2 m arrived at? Is it an accurate figure or simply a rounding up?
  The framing of such provisions will have an impact on the cost of the Bill in relation to the amount of local authority involvement and the number of times that local authorities will be required to intervene. Clause 20 provides for a change in the definition of high hedges and the scope of clause 1 by secondary legislation. That, too, could have a significant impact on the cost of the Bill—
  Madam Deputy Speaker (Sylvia Heal): Order. The hon. Gentleman is now coming back to the costs of the Bill—I was hoping that he would do so.
  Mr. Hammond: Thank you, Madam Deputy Speaker.
  The intention—the hope—is that many disputes will be resolved without the necessity for local authority
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  intervention. The more the legislation is drafted in a way that encourages that intention, the less local authorities will have to intervene, the fewer appeals will be amounted, and the lower will be the cost to public funds. However, I am alarmed that the kernel of the Bill—the definition of a high hedge—could be changed subsequently by secondary legislation, with a commensurate increase in the cost burden.
  All those issues can be properly addressed in Committee. They are worthy of detailed exploration and with good will on both sides they are capable of resolution so that we end up with a robust piece of legislation. We shall not oppose the motion, but I have some questions for the Minister on the financial aspects of the Bill and the regulatory impact assessment.
  There are two main costs to public funds: the costs to local authorities of undertaking the primary work on dispute resolution; and the costs of the authority that deals with appeals. The explanatory notes suggest that there may be a backlog of 10,000 unresolved hedge disputes. As several Members suggested on Second Reading, that may be a serious underestimate. At present, there is no resolution mechanism, other than negotiation with neighbours, and I suspect that the number of disputes to be resolved will be substantially higher.
  The regulatory impact assessment suggests that the cost of resolving the estimated 10,000 disputes in the pipeline would be about £3 million, or £300 per dispute. Anyone who has been involved with contentious local planning issues might consider that that reflected a rather optimistic view of the speed with which such matters are resolved. Much officer time is likely to be used up dealing with and intervening in such disputes.
  The RIA notes that the cost per dispute will be offset, to some extent, by the fee chargeable to the complainant. Can the Minister indicate his Department's current thinking about the likely amount of that fee and thus the degree to which public funds would be offset?
  What is certain is that there will be a cost to local authorities. As the Licensing Bill shows us, if local authorities are to be given new duties and responsibilities, they must have funding to ensure that they can discharge them properly. Will the Minister tell the House how the net costs to local authorities will be met, so as to ensure that the money actually reaches the authorities that are doing the work and dealing with the disputes? On Second Reading, my hon. Friend the Member for Christchurch (Mr. Chope) referred to a local authority in his area that was not in receipt of formula grant and would thus not benefit from generalised funding. It would benefit only if the money were targeted on authorities doing such work.
  The second source of cost to public funds is the appeals procedure. The Government have estimated that 20 per cent. of complaints might give rise to appeals. That is a tremendously optimistic underestimate. The form that the right of appeal will take is somewhat akin to introducing a third party right of appeal to the planning procedure. The right of appeal will be open not only to the complainant whose complaint is turned down, but to the defendant—the landowner who is required to take remedial action.

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  Assuming—as the wording of the Bill and the explanatory notes require us to assume—that complainants will be required to have exhausted normal negotiating and dispute resolution procedures, the cases that come to local authority determination will be the hard cases where people have deeply entrenched and hardened views. I suggest to the Minister that many more than 20 per cent.—perhaps more than 50 per cent.—of those cases are likely to go to appeal unless there is a substantial financial disincentive to the losing side to take a case to appeal. Will the Minister clarify whether the Government intend to create a financial disincentive through a costs regime and, if so, whether he agrees that the 20 per cent. estimate is likely to prove very conservative?
  I note that the regulatory impact assessment says that the average cost per appeal is estimated to be £1,100, and there is a suggestion that no more than three or four hours of inspectorate time would need to be spent on an appeal. That presumably implies that it is envisaged that the inspector conducting an appeal would not need to make a visit to the site. Has the Minister satisfied himself that an inspector making a decision without visiting the site would constitute the independent tribunal to which human rights legislation provides an entitlement?
  Can the Minister tell the House whether he has made any estimate of the likely cost to local authorities of carrying out remedial action themselves? I am aware that where they have to do so they will register a charge over the property in question as they currently do, for example, in dealing with derelict land. However, it may be a very long time before there is a transaction relating to the land that enables them to recover that cost, and in the meantime that is a revenue cost that has to be funded. I do not see any estimate in the regulatory impact assessment of the direct costs to local authorities of carrying out the remedial work.
  I suggest to the Minister that the cost to the public purse, if local authorities are properly funded for carrying these responsibilities, and before any net-off of fees received, could easily be much higher than the regulatory impact assessment suggests—let us say, given a backlog of 20,000 cases rather than 10,000, and a more realistic estimate that the cost of dealing with a case will be £600 per case, that it might be £4 million or £5 million In the first three years. If 50 per cent. of those cases went to appeal, with an appeal cost of between £1,000 and £2,000 per appeal, we would be looking at another £3.5 million to £8 million per year, with the cost of local authority remedial action on top. The cost might be somewhere in the region of £7 million to £20 million a year of public funds. I readily accept that in the context of public spending that is not a vast sum of money, but it will require funding, particularly proper funding for the local authorities that will primarily incur the costs.
  The critical issues are whether the Government will provide adequate funding to local authorities and how the Government are going to distribute that funding between local authorities—in other words, whether the permissive power that the Bill's money clauses give the Secretary of State to expend moneys, where it creates additional burdens, will be translated into the real distribution of hard, as opposed to notional, cash sums to the local authorities that have to implement Parliament's intentions.
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  A number of issues remain unresolved. We look forward to debating and, I hope, resolving many of them in Committee. In the meantime, I hope that the Minister will make some comments in response to my specific questions on the money-related issues.
  7.44 pm
  Mr. Alan Meale: First, I congratulate my hon. Friend the Minister, who presented a very good case. I am grateful to the Government for taking this action in supporting a private Member's Bill so as to pass legislation on this particularly important subject. I say that it is important not only because I have had to take up individual cases as an MP, especially in connection with the now infamous leylandii conifer tree, but because when I was at the Department I had to pick up the issue that had been cast aside by the previous Government, who said that nothing could be done in any way, shape or form to try to alleviate the problems connected with it. I am particularly grateful to my hon. Friend, who has worked assiduously to try to bring a resolution before the House and to encourage hon. Members to take it forward through a private Member's Bill.
  In response to the hon. Member for Runnymede and Weybridge (Mr. Hammond), I believe that the Bill refers to a height of 2 m because that was viewed as the maximum eye-line for vision outside one's downstairs window. It is as simple as that. That was the mechanism that was introduced to the argument by local design planners.
  Mr. Hammond: I think that the hon. Gentleman will find that the 2 m limit is already present in planning legislation about fences and boundaries. However, it was not 2 m in pre-metric days—it was 6 ft, which is somewhat less than 2 m.
  Madam Deputy Speaker: Order. Perhaps we can now get back to discussing the additional costs to local authorities envisaged in the Bill.
  Mr. Meale: Thank you, Madam Deputy Speaker.
  I support some of the arguments advanced by the hon. Member for Runnymede and Weybridge about costs, which have been greatly underestimated. There is a reason for that. The figure of 20,000 is far below all the evidence that has been presented to previous Conservative Governments and, indeed, Labour Governments. There are thousands of these cases, especially concerning the more modern problem of the leylandii conifer. Local authorities know that it has been a problem in all matters connected with building land and local authority services for many years. We should not view this as something that has just arrived owing to the invention—in Britain, I may add—of a particular species of conifer tree. The conifer in question, which causes most of the despair among homeowners, is the leylandii conifer. Contrary to what has been suggested, it is not a foreign species from Canada, but a product from Wales that originated in the late 1800s. It has been around for a long time. I am pleased that the Government have managed to get out some sensible information to people who buy products that grow very quickly in their gardens, but my hon. Friend the Minister has realised that that is not nearly enough to deal with the scale of the problem that we face.

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  The hon. Member for Runnymede and Weybridge talked about costs. The costings that have been put forward are greatly underestimated. For example, the estimate of costs to people who take up cases is extremely low, given that this is ultimately a planning matter that follows the normal lines in terms of the rights of appeal of both parties—that is, under normal circumstances large numbers of people will take that course, which will run up high costs. One of the reasons why local authorities are now tied down as to whether they accept planning applications or seek to overrule them is that under best value they must first face up to the district auditor. If someone receives a wrong decision, then wishes to take their appeal further, the local authority has to estimate whether it is likely to win, as with any insurance policy, and how much money it might subsequently lose. In those cases, the cost is usually between £12,000 and £14,000. If 20 per cent. of cases go to appeal and the backlog is between 10,000 and 20,000, the cost will be enormous. However, I know that my hon. Friend the Minister will deal with those matters in Committee.
  I am also worried that not enough regard is being paid to the amount of money that will have to be made available for local authorities to make a case for funds when they have many cases with which to deal. I represent an urban authority that does not have many cases, and they can be dealt with under the procedure. However, the cost to a local authority in a rural community could be enormous. I hope that my hon. Friend will consider including in one of the new standard spending assessments the ability for local authorities that have a definite case to bid for funds. Money has been tweaked in the SSA to help local authorities to bid for extra money to deal with the problem of large areas of floodplains that have been built on so that they can do the work before a disaster occurs.
  I welcome my hon. Friend's fine work. The measure is not before time. I am grateful to those members of the Opposition who have taken a great interest in the subject for their support in resolving the problem, which makes the lives of many thousands of people in Britain a misery.
  7.51 pm
  Mr. Christopher Chope: The hon. Member for Mansfield (Mr. Meale) makes two important points. The first is that the Bill will have a differing financial impact on different local authorities depending on whether they are urban, rural or suburban; yet the Government have proposed a standard distribution of grant through a standard formula that will not be proportionate to the needs of local authorities in implementing the legislation. The second is that the costs of appeal will be much more significant than the Government have so far recognised. The hon. Gentleman could have added that unlike ordinary planning appeals, either side will be able to appeal. If the local authority grants planning permission, there is nothing that people can do about it. They cannot appeal. However, if a local authority makes a decision, irrespective of what it is, on a hedge,
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  there will be a right of appeal and the proportion of appeals will increase, as my hon. Friend the Member for Runnymede and Weybridge (Mr. Hammond) said.
  I spoke on the subject on Second Reading, although there was not much time for the Minister to respond to the debate. I hope that he will have a chance to respond this evening to the concerns and questions raised. Without repeating my hon. Friend's questions, I ask the Minister to spell out the fee structure that the Government have in mind for the complainants and what they will do about the concerns expressed on the differing impacts of the Bill on local authorities. I also hope that he answers the question that I raised on Second Reading about how East Dorset district council, which does not receive formula grant funding but only redistributed non-domestic rate, is to be reimbursed by the Government for the costs incurred as a result of implementing the provisions.
  As a matter of common sense, I hope that the Minister accepts that it seems likely that there will be more than an average of fewer than 20 cases per English constituency, which is what 10,000 cases would amount to. If the Bill is as significant as some of its supporters suggest, the number of cases could be far higher than that.
  I have one constructive suggestion. As the hon. Member for Mansfield said, there are precedents for the Government to reimburse the costs to local authorities on a specific basis. Some local authorities incur large sums in carrying out coastal protection work, which is refunded in whole or in part by the Government. Surely there is every reason why the scarce resources of the taxpayer that will be distributed by the Government to help to ease the burden of local authorities should be distributed to meet costs incurred rather than on a notional basis. Money distributed on a notional basis for concessionary fares resulted in grave injustices in both local authorities in my district, Christchurch borough council and East Dorset district council.
  I hope that the Minister can respond constructively to those concerns so that the mood on the Standing Committee will be positive. He said that he does not necessarily believe in consensus, but if the Bill is to have the support of local authorities, the Government need to spell out clearly the basis on which the reimbursement of costs will be paid.
  7.56 pm
  Mrs. Annette L. Brooke: I support the Bill wholeheartedly and am pleased that the Government also support it. Like other hon. Members, I have some questions and think that aspects of it need scrutiny, especially if elderly or vulnerable people are unable to tend their hedges. We need to take care when we deal with that—
  Madam Deputy Speaker: Order. I remind the hon. Lady to relate her comments not to the Bill, but to the money resolution.
  Mrs. Brooke: I apologise, Madam Deputy Speaker.
  I want to reiterate what has been said about the necessary finance for local authorities. That is important. I am in an unusual situation: instead of the finger being pointed at the Liberal Democrats for asking

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  for more resources, I am echoing and supporting the call by the Conservative party for that. There is a huge demand for action. Some cases are tragic and there are high expectations of local authorities. They need resources not only for the planning process itself, but to facilitate a good mediation process, which will take up staff time.
  There will be much work to do in the first few years before precedents have been set by appeal results. The process will be resource intensive, not just because of the number of applications, but because those precedents and guidelines will not have been established. It is important to have money up front and to make it clear to local authorities that they will have sufficient resources to carry out that work because they are already short of resources for essential enforcement action on, for example, planning conditions. I would hate one problem to be solved at the cost of a host of other problems in the community.
  7.58 pm
  Mr. McNulty: With permission, Madam Deputy Speaker, I should like to respond to the debate.
  I do not remember saying that I eschewed the notion of consensus, but I am sure that if it was reported twice, I probably did. I should qualify that by saying on most issues. I would certainly hope for consensus on this subject. I know that we are talking about the money resolution, but it would be remiss of me, as alluded to by the hon. Member for Runnymede and Weybridge (Mr. Hammond), if I did not endorse what he said about previous attempts to secure such legislation on both sides of the House. It is by no means a partisan measure and I am more than happy to acknowledge, as I did on Second Reading, the role played by the hon. Member for Solihull (Mr. Taylor), the former hon. Member for Mid-Kent and Faversham and my hon. Friend the Member for Coventry, South (Mr. Cunningham). I look forward, in the nicest possible way, to the hon. Member for Runnymede and Weybridge or his colleagues probing my hon. Friend the Member for Ealing, North (Mr. Pound) in Committee, with all that that entails.
  The money resolution, and the cost structure in the impact assessment, have to be seen in the context of a range of other things. It is inappropriate to pooh-pooh advice given in pamphlets—although I am sure that the hon. Member for Runnymede and Weybridge was not doing that. "The right hedge for you: a guide to choosing a garden hedge" was an important piece of work, although it may well be that it should have followed legislation rather than preceding it. Nevertheless, through that sort of advice and information pack, we are trying to work closely with local authorities. There will be guidance on the legislation—it will not simply drop from the sky—and it will include guidance on how local authorities might assess the various issues that may be raised by complainants. That guidance will be widely available. There is a desire for some degree of education and awareness-raising, as well as simply legislation.
  Mr. Chope: Will the Government issue draft guidance to be considered at Committee stage?
  Mr. McNulty: As I said throughout the stages of the Planning and Compulsory Purchase Bill, I hope that
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  such draft guidance will be issued. That is the best way of doing things and I will do all that I can to ensure that that happens. I may stretch that guidance to include other things as the Bill goes through both Houses, but I will ensure that it is available at some stage—Committee stage or Report stage—in this place. It will be an important element of scrutiny.
  The hon. Member for Runnymede and Weybridge—I apologise for nearly saying Runnybridge and Weymede—was right to say that this Bill is not about banning high hedges. The Bill is about putting in place a regulatory framework for mediation. The costs reflect a stand-alone mediation process. With previous legislation, difficulties with costs and effectiveness have arisen. Part of the reason for that has been that measures were tagged on to the criminal trespass regime, the planning regime or other regimes, rather than—
  Madam Deputy Speaker: Order. I will treat the Minister in the same way as Back Benchers and ask him to relate his remarks to the additional costs for local authorities.
  Mr. McNulty: I will do that, Madam Deputy Speaker. I was going to refer to the costs of a stand-alone system of mediation as opposed to a system attached to the planning or criminal trespass regimes.
  The elements that are referred to in the regulatory impact assessment relate to evidence from previous consultations. The 20 per cent. figure for the rate of appeals is higher than the 5 per cent. figure that was used in previous regulatory impact assessments; and it is double the rate of appeals in cases of nuisance—an equally important and troublesome area—and some seven times the rate of appeals in planning applications. I would not describe this as a third-party right of appeal; it is a mediation process, and it takes two plus the mediator to tango, as it were. We have inflated the figure to 20 per cent. rather than using the lower figures because the fact that each party can appeal against the mediation will be reflected in the costs.
  Mr. Hammond: I have never seen the Minister dance but the mind boggles at the thought of two plus the mediator tangoing. Will he tell us about the costs of appeals? Will a disincentive to appeal be put in place through the possibility of award of costs against the appellant?
  Mr. McNulty: As I said earlier in response to the hon. Member for Christchurch (Mr. Chope), there will be regulations for the fee structure and all the other elements if the Bill is successful. Those regulations will be available in draft form and they will certainly be consulted on before they are presented to the House. One assumes that they will reflect the evidence of cost structures that we already have. Despite protests from hon. Members on both sides of the Chamber, that evidence remains the evidence of the 1999 consultation. The structures will have to include some kind of disincentive to prevent capricious or vexatious appeals after the mediation process.
  Hon. Members should bear in mind the fact that costs are calculated in the context of the mediation service actually working. It would be remiss of us to make

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  calculations assuming a 90 per cent. or 100 per cent. appeal rate. There is also a tripwire because the local authority will not entertain the mediation process unless it is clear that the complainant has exhausted all other means available. There will not be an open house: if someone does not like the leylandii or whatever other kind of hedge next door, they will not be able simply to bung in a complaint to the local authority and expect it to succeed. Things will not work in that way. We intend a stand-alone mediation system.
  Many of the issues that hon. Members have raised are worthy of further exploration in Committee. Based on the evidence, we believe that the statements in the regulatory impact assessment on costs to local authorities and appeal authorities, and the assumptions in the assessment on the costs of subsequent appeals, are correct. I will not be tempted down the route of a debate on clause 20 on definition and scope. Those issues can and should be investigated further in Committee. That is route, not root, I hasten to add. Any shortfall in our calculations will be covered by the Office of the Deputy Prime Minister under the new burdens principle and through a system that has yet to be determined but which will embrace both elements of the financial regime for local authorities.
  I take the point about the difference in the impact on rural and urban authorities, or on urban and suburban authorities. That difference will have to be reflected in any assumptions that are made in the financial regime. However, we are talking about a significant cultural change.
  Mr. Chope: I am grateful to the Minister for referring to the different impacts. Will he go further and address the concern of East Dorset district council, which does not receive any formula grant funding at all? How will that council be reimbursed?
  Mr. McNulty: We are talking about a money resolution but I cannot be drawn on whether East
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  Dorset district council receives grant or not, or on what its proportions are in terms of the national non-domestic rate and the rate support grant. That would lead me into money areas that would cause you, Madam Deputy Speaker, quite rightly to pull me up again. I know that "pull me up" is not a very parliamentary term but it was the best that I could think of. However, shortfalls will be covered. Opposition Members do not seem happy with that comment, but it was an attempt to answer the question that they have rightly asked.
  The thrust of the Bill and the associated money resolution is rooted in evidence. The Bill covers a very important issue and we intend, through consensus—however much it sticks in my throat to say that—to secure its passage through the House with the appropriate costs to the public purse, which will be reflected in the money resolution and the regulatory impact assessment.
  Question put and agreed to.
  Resolved,
  That, for the purposes of any Act resulting from the High Hedges (No. 2) Bill ('the Act'), it is expedient to authorise the payment out of money provided by Parliament of—

  (1) any expenses incurred by the Secretary of State in consequence of the Act; and

  (2) any increase attributable to the Act in the sums which are payable out of money so provided by virtue of any other Act.

  Madam Deputy Speaker (Sylvia Heal): With permission, I shall put together motions 10 and 11.

  High Hedges (No. 2) Bill [Money]

    Ordered,
    That Mr. Brian Jenkins be discharged from the Broadcasting Committee and Jim Sheridan be added.

    That Mr Alan Williams be discharged from the Committee on Standards and Privileges.—[Mr. Jim Murphy.]

    Kent and Canterbury Hospital
    Motion made, and Question proposed, That this House do now adjourn.—[Jim Fitzpatrick.]
    8.9 pm
    Mr. Julian Brazier: I am delighted to have another opportunity to extol the virtues of a great hospital and its dedicated staff. It saddens me, however, that, after five Adjournment debates, so many years of public outcry and protest and so much evidence, the future role of the Kent and Canterbury hospital should still be in doubt.
    It is perhaps worth looking back at the beginning of a long, sorry saga that affects a hospital that has served the local community and, through it specialties, the wider region so outstandingly well. The story started in 1996, shortly after the opening of the new development at Margate—the Queen Elizabeth, the Queen Mother hospital—when the then East Kent health authority,EKHA, made a proposal to run down the children and maternity units at the Kent and Canterbury hospital and focus them on two other sites.
    EKHA's argument for that dramatic change was the need for concentration to ensure that training recognition continued with the royal colleges. I should say that no royal college has threatened to remove training recognition at any point from the Kent and Canterbury hospital. At that time, the Kent and Canterbury was by far the most efficient of the seven hospitals in Kent. In 1995, a national league table showed that it was the third most efficient hospital in England.
    The proposals for that partial run-down were firmly rejected by the then Secretary of State, my right hon. Friend the Member for Charnwood (Mr. Dorrell), who Insisted on a more imaginative approach, whereby the three main sites—Canterbury, Ashford and Margate—carried out joint training. Immediately after the 1997 general election, however, EKHA leapt into a process of fervid activity and within a matter of months, in December, came up with an ill-founded proposal to reduce Kent and Canterbury hospital to a day centre with one solitary ward of geriatric beds.
    Battle was joined in earnest. A campaigning organisation—Concern for Health in East Kent—was established, drawing support from prominent figures, Including all three political parties locally, and I cannot pay it strong enough tribute to the battle that it has fought. EKHA modified its proposals and decided instead to keep roughly half the hospital, but to close the accident and emergency unit and remove almost all the specialist facilities.
    The proposals were put to the then Secretary of State, the right hon. Member for Holborn and St. Pancras (Mr. Dobson). He modified the EKHA proposals yet again, insisting, in particular, that coronary care should be retained at Kent and Canterbury hospital and pledging that it would remain a joint cancer centre with Maidstone. Indeed, that joint centre underpins the cancer outstations at the other five main hospitals in Kent.
    After that, EKHA decided that the proposals were unworkable and began the consultation process all over again—jointly this time with the newly created East
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    Kent hospitals trust. There was another long, bitter round of campaigning, with CHEK leading the way again. Astonishingly, EKHA brushed aside the all the proposals on which it had consulted and introduced an unheard of fifth proposal for a diagnostic and treatment centre at Kent and Canterbury hospital, but it still proposed to focus the accident and emergency units on the other two hospitals, leaving only a minor injuries unit to deal with accidents at Canterbury, while keeping a sizeable bed capacity to cover elective care.
    Cancer was left out of the document and confined only to an uncosted annexe, and the trust responsible for delivering cancer care at Kent and Canterbury hospital was not even a signatory to the document. For some months, that proposal has now been with the Department of Health, where Ministers are, no doubt, rightly giving it very thorough scrutiny. I am delighted to see the Minister in her place to respond to this debate, as we have exchanged views on a number of occasions. Indeed, last July, the Secretary of State received a delegation of MPs and specialists, led by me, to discuss the proposals.
    Fortunately, things have moved on. With the demise of EKHA and the much more open and straightforward approach of the new Kent and Medway health authority, the impetus for change appears to have altered. Since our meeting with the Secretary of State, two important developments have taken place—one national, the other local.
    At national level, the Government have published the White Paper, "Keeping the NHS Local—a New Direction of Travel", which represents a reversal of the trend towards ever larger centres and emphasises the importance of access. I welcome the document, which applies directly to our own case. Let me quote two of three core principles; I shall return to the third in a moment. First, it demands a

    "focus on redesign, not relocate".

    Amen to that. Secondly, it refers to the need to

    "take a whole systems view … to exploit the contribution of different hospitals, primary and intermediate and … social care providers".

    Both those principles would rule out the proposals currently before the Secretary of State. Indeed, the reason that all the Kent branches of the Royal College of Nursing rejected the latest consultation document was that it had been prepared without the involvement of community health services. That is made explicit on the covering page of the Royal College of Nursing commentary. Perhaps the Minister may be able to tell me in her winding-up speech whether the proposals before her will be referred to the reconfiguration panel, which forms an important part of the White Paper. Indeed, it is the note on which the White Paper ends—a very important body.
    At local level, the parallel development, which is also welcome, is that the East Kent hospitals trust has introduced some interim proposals that represent an important step forward in two respects. First, that document effectively recognises the stark reality that the health authority will not get the money—figures of £100 million, £200 million and even £300 million have been bandied about—required for that sort of radical proposal. As a result, it seeks to build on existing arrangements, rather than on greenfielding. Secondly,

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    there has been a genuine attempt to engage with medical staff in a way that did not happen in earlier proposals, although that process has been uneven.
    None the less, even those interim proposals suffer from several severe faults. First, the costings are completely unrealistic, and I confess to having a background in corporate finance. For example, the actual removals cost for each facility is listed at £5,000—less than Pickfords charge for moving the contents of a large house. The building estimates, too, bear no resemblance to reality. In combination, the building cost budgeted—about£15 million—probably amounts to less than the actual cost of relocating one or two of the departments.
    The truth is that NHS capital projects have tended to overrun massively, and the most recent in east Kent—the Queen Elizabeth, the Queen Mother project—was no exception. This project would certainly be no exception even on those provisional costings. The net saving for option 3, which would involve the largest move away from Kent and Canterbury hospital and is the only one fully financially assessed, amounts to only £3 million a year. In practice, given the vast underestimate in capital costs and the interest charges inevitably associated, that option would almost certainly worsen the already dire financial position in east Kent, rather than improve it.
    Cancer has been excluded, presumably because it is the responsibility of another trust. It is, however, dependent on 28 other facilities provided in the Kent and Canterbury hospital, so it must be brought into the picture.
    The most important weakness of all, in my view, goes back to the original flawed proposals for children's and maternity services in 1996. More than a third of the population of east Kent live in villages. Many rely on buses to Canterbury, or on volunteer drivers, many of whom are elderly and, while willing to give their time generously, are understandably willing to drive only so far. Hardly a single village in east Kent has decent access to Margate. One or two provide access by public transport, but most are a long way away.
    My right hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard) pointed out in a speech that many villages that, as the crow flies, are closer to Ashford than they are to Canterbury have decent bus access only to Canterbury. In fact, the vast majority of villages provide the best access to Canterbury on buses. Canterbury is the hub of the east Kent bus system. Moreover, there are two railway stations, one on each of the two main railways lines through east Kent. A number of small coastal towns also have much better access to Canterbury—Whitstable, which I represent, Herne Bay and Faversham. I am delighted to see my hon. Friend the Member for Faversham and Mid-Kent (Hugh Robertson), who I hope will say a few words later. He has been a stalwart supporter of the campaign.
    The number of patients who cannot reach hospitals by buses or volunteer drivers would inevitably increase greatly, even with the interim options; yet the heavy extra cost to the ambulance service, which is already overstretched, seems to have been ignored, perhaps
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    because it comes from a different budget. The price in lost access to the family and friends of patients cannot be costed—but it will be paid, in terms of a lower recovery rate for patients whose loved ones cannot get to their beds. The truth is that, for roughly half the population of east Kent, Canterbury is by far the most accessible of the three sites.
    Further problems arise from the consideration of individual service configurations. I do not want to go into detail, but I will say something about accident and emergency services, which are most important and which have simply not been thought through. As I have said, Canterbury is at the centre of east Kent, and Margate is inaccessible. The interim accident and emergency proposals for Margate, however, are flawed in principle. What sort of A and E centre would have no facio-maxillary, no vascular surgery, no ear, nose and throat services and no eye facilities? If that is what is proposed for Margate A and E, surely it is not viable in the long run. Who would want to work in an accident and emergency system that was supposed to provide a full service with consultants, but whose structure was so incomplete?
    In fact, the interim proposals leave east Kent with only one real. long-term A and E centre, at Ashford. Ashford is an important place and is expanding, but it also happens to be the only place in east Kent with excellent road access to another A and E service—at the huge hospital at Maidstone, just 15 minutes up the motorway. It is surely ridiculous to propose that east Kent's main A and E facility should be at Ashford, the only east Kent population centre with really good access to west Kent's premier A and E centre.
    Two weeks ago there was a multi-car pile-up at Brenley Corner in the morning fog. Mercifully, there were few injuries, largely because of the extraordinary bravery of a crane driver who risked his own life to avoid the crash. Had it not been for his heroism, there would probably have been many serious casualties. That is the view of the ambulance service; it is not just my view.
    Where would those people have been sent? Getting to Ashford would have meant a long, slow journey down a tiny country lane. Had Canterbury lost its A and E centre, would the ambulance crews have ended up picking and choosing according to category? Would those with minor injuries have been taken to Canterbury—by far the closest destination—while those with facio-maxillary, vascular, ENT or eye injuries were sent to Ashford, the least accessible point, down the little winding country lane? The rest, presumably, would have gone to Thanet.
    It is worth considering overstretch, which has featured so much in the national press. Last year, sadly, east Kent repeatedly made the national news with stories of people in their eighties and nineties waiting for two or even three nights for a proper bed in A and E. Blind statistics hide the individual humiliations and tragedies of people such as Connie Jones, who, in her nineties, waited two days for a bed, and octogenarian Ray Gilson. His family, who have owned a little seafood shop on the Whitstable waterfront for many years, in desperation scraped together the money to get him into the Chaucer private hospital so that he could spend his last few days in some sort of dignity rather than hanging on without a bed in A and E.

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    Mercifully, this year the overstretch has been greatly reduced, partly through some innovative changes in the hospital, for which the hospital must take due credit, partly because of extra money that the Government have provided and partly because of a considerable shifting of the burden on to our community hospitals, which hitherto have provided an excellent service, yet find themselves increasingly struggling to meet the extra challenges placed on them by the acute hospitals—challenges that they are not equipped to face. I have never had a complaint about the Whitstable and Tankerton hospital, until the past year or so, when there has been a drip-feed of people saying that it is overcrowded and overstretched. Interestingly, there are also signs of over-administration under the new arrangements.
    The worst case that I have received in the past 12 months involves the Queen Victoria hospital, the cottage hospital in Herne Bay, and the interface between the Queen Victoria hospital and the Kent and Canterbury. I do not wish to go into the details of the case here, save to mention that my constituent, Mrs. Florence Jones, a 73-year-old suffering from dementia, twice fell over while she was at the Queen Victoria hospital awaiting an operation at the Kent and Canterbury because she was not escorted to the lavatory, and on the second occasion she broke her wrist. She suffered a multiple fracture. She was left for three days, apparently without fluids, and has, sadly, died. Her son and daughter brought the case to me.
    The extent to which inappropriate problems are being pushed on to our community hospitals, and the extent to which the interface is not working, are partly demonstrated by the administrative muddles in the paperwork in that case as it went to and fro, but, worst of all, by the fact that Mrs. Farnham, Mrs. Jones's daughter, virtually had a stand-up fight in A and E to prevent her mother from being transferred back to the Queen Victoria from A and E overnight, when her operation was delayed until the following morning.
    I do not want to criticise any medical or nursing staff at the Kent and Canterbury. They are desperately overstretched. So many former patients have had so many words of praise for them over the years, right up to the present time. However, we must recognise that we are still desperately short of capacity, and any proposals for capital expansion must take full account of the fact that, with our huge financial overrun, we cannot afford a further debt burden and the interest charges that that would bring.
    We must also recognise that Canterbury is not just the most accessible site in Kent, and the one with the concentration of regional specialties, but remains the main centre for surgery in east Kent. I have a graph of surgical operations at the main hospitals in east Kent over the most recent 12 months. Of the in-patient cases—the major surgery cases—Canterbury carried out more surgery than the William Harvey hospital in Ashford in every month of the past 12, save one. In some months it carried out as much as a third more than the William Harvey.
    Compared with the Queen Elizabeth, the Queen Mother hospital in Margate, the disparity is much greater. In the two most recent months for which figures are available, January and February this year, the Kent and Canterbury carried out 1,466 in-patient operations,
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    almost double the 802 achieved by the Queen Elizabeth, the Queen Mother hospital in Margate, yet it is Kent and Canterbury hospital that is threatened.
    I am anxious that this should be a constructive exchange, and I welcome the willingness of Ministers to discuss the problem. I particularly welcome the fact that the Under-Secretary of State for Health, the hon. Member for Salford (Ms Blears), has been down to see for herself. Her Government's new framework is based on looking at services as a whole and—I quote again—"redesigning, and not relocating". It is time to realise that Canterbury is by far the most accessible point in east Kent. It has the hospital with the greatest success in recruiting medical staff—a hospital that continues to remain the premier surgical facility and is the centre for all east Kent's regional specialties.
    I do not think that anybody still thinks that the proposal that theoretically remains before the Secretary of State will ever fly, not least for cost reasons. It is time to bring to an end this five-year saga of proposal and counter-proposal, and to all the misery that that has brought to our overworked staff at the hospital. We need to build on what we have in our three acute hospitals in east Kent and focus on reinforcing strength—and by far the strongest hospital is the Kent and Canterbury.
    The good things that can be picked out of the trust's interim proposals should be picked out, including ideas for consolidating one or two services at individual hospitals where that can be done without compromising interlocking dependencies. Any change must be implemented in a way that leaves our acute health facilities available where patients can best get to them without saddling our local budget with the heavy interest charges that come from huge capital spending.
    In the words of the third guiding principle of "Keeping the NHS Local", options for change should be developed

    "with people, not for them, starting from the patient experience"

    and by

    "working with staff to find new ways of delivering services."

    Let us shift the emphasis back to the hospital that is most accessible to the largest proportion of people by far, where the largest output of major surgery is achieved and which has the greatest concentration of specialities—the Kent and Canterbury hospital: and, please, it ain't broke, so don't let's break it.
    8.31 pm
    Hugh Robertson: I rise to speak in support of my hon. Friend the Member for Canterbury (Mr. Brazier). In doing so, I should like briefly to pay tribute to the work that he has done on behalf of the Kent and Canterbury hospital over very many years. He has done an enormous service to his constituents in Canterbury and to many from throughout the wider east Kent population. I should also like briefly to pay tribute to all the members of the Campaign for Health in East Kent—I do so not least because they are present—who have done marvellously well in keeping up their enthusiasm and keeping the campaign going. They have been a tremendous tonic to those of us who have been fighting the political battle.
    I wish to represent the interests of my constituents in Faversham and the surrounding villages, who will be severely affected by any changes to the Kent and

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    Canterbury, perhaps more than anybody else in east Kent in many ways, for six reasons. I shall confine my remarks to concerns that are specific to my constituency, rather than to the much wider issues to which my hon. Friend referred. Of course, he made some very specific points, and I should like in particular to draw the Minister's attention to his comments about cancer, which is a huge problem area.
    My particular concerns are as follows. The first is transport. Transport links in east Kent are known to be extremely poor. It is sometimes difficult enough to make a journey from Faversham to Canterbury, but it is always difficult to travel from Faversham to Margate. To make a journey from Faversham to Ashford, as many of my constituents will have to do, is almost impossible on many days. As my hon. Friend said, the road is small and winding and is used by farm traffic. Lorries regularly jam the road and a protest group is currently forming to express concern about its current traffic level. If we were to add all the traffic that would travel along it carrying people to hospital, the situation would become intolerable. Public transport provision in that part of Kent is also hugely inadequate.
    Secondly, on the question of location, as my hon. Friend said, Canterbury is at the hub of east Kent. It has a cathedral and a huge student population. By any judgment, it is the correct location for a hospital in that part of the world, regardless of where the others are situated. Neither Margate nor Ashford has any of those advantages.
    Thirdly, there is the question of capacity. The Government have announced huge house-building plans for much of the south-east. Many of the houses will be built just to the south of my constituency border. That will clearly bring an enormous number of extra people into the county, and they will have health needs. With that capacity increase in the wind, surely it is not time to be shutting, downgrading or closing hospitals.
    Fourthly, there is a lack of alternative facilities for my constituents. Faversham cottage hospital is an excellent small local hospital to which I pay tribute. However, it is not and was never intended to be the Kent and Canterbury. I should have thought that it was eminently sensible to build up local facilities before downgrading the Kent and Canterbury. Clearly, that has not happened.
    Fifthly, there is a problem of deprivation. Although some areas of east Kent are extremely wealthy, others are extremely poor. My market town of Faversham has a relatively prosperous mediaeval core and a Victorian part, which was built with the arrival of the railways. A third generation of people came from the east end of London to pick fruit in the summer. It has a huge area of social housing. Downgrading the local hospital will lead to many people feeling excluded from the health service. They will feel that their local hospital has gone and they will suffer from that loss because they are often heavy users of the health service.
    Sixthly, delay is a problem, to which my hon. Friend the Member for Canterbury has already alluded. The saga has gone on for a long time and has undoubtedly affected the confidence of many of the excellent people who work in our hospital. It has certainly affected the
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    confidence of many constituents. I hope that the Under-Secretary and the Department can soon bring it to an end.
    Given the bigger political picture in the national health service and in population growth throughout Kent, I am surprised, if not amazed, that the Government should even consider downgrading the Kent and Canterbury hospital. In my view, it is simply the wrong option at the wrong time. Perhaps I would say that as I was born there 40 years ago. I urge the Under-Secretary, in the strongest possible terms, to reconsider the decision.
    8.36 pm
    The Parliamentary Under-Secretary of State for Health (Ms Hazel Blears): I congratulate the hon. Member for Canterbury (Mr. Brazier) on securing the debate on a matter of concern to him and his constituents. I also acknowledge the passion with which the hon. Member for Faversham and Mid-Kent (Hugh Robertson) made the case on behalf of his constituents. Health service issues always cause concern. That is right because our constituents greatly value the health service.
    The people of Kent deserve a fully modernised health service, which provides them with the highest quality services. Everybody acknowledges that reconfiguring acute services is an integral part of the agenda. I stress to all hon. Members who have contributed to debates on the subject that the decision will be made in the interests of all the residents of east Kent. It is right and proper to say that.
    For that reason among others, the Secretary of State has decided to refer the case to the independent reconfiguration panel for consideration. The new advisory body was announced in the NHS plan to help ensure that decisions on the outcome of major health service reconfigurations are fair and objective. The panel's remit is to consider three main items: whether the proposed service configurations are sustainable., whether they fully support modernisation and whether they result in improved service for patients. The panel will provide advice to the Secretary of State, who will then make an informed decision, taking the panel findings into account.
    The NHS plan sets out a challenging 10-year programme for NHS reform. Far-reaching changes are inevitable to try to provide the best possible services for patients. We all acknowledge the pressures on the service, not only in east Kent but throughout the country, of trying to increase capacity so that patients can get ready, quick and responsive access to services. We want not only to increase capacity but to raise clinical standards generally.
    There are major inequalities in the health service throughout the country and we are committed to tackling them. We must also ensure that services are accessible and flexible. We want to design services around the needs of patients. The NHS must no longer be configured around the needs of institutions. We must follow the patient pathway and wrap services around the patient's journey.
    As part of the modernisation programme, many NHS trusts are considering changes to the way in which they organise their services. I believe that we all recognise that hospital services need to change if we are to

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    continue to fulfil patients' needs and improve access. Things cannot remain in aspic. There are a number of different pressures on the service, including the working time directive and certain clinical governance issues. All those issues need to be taken into account as the health service changes.
    We want to try to help trusts that are developing their plans for service expansion and redesign to have a direction of travel in their minds when they were considering the changes. That is why we have published the new guidance, "Keeping the NHS Local: a New Direction of Travel", to which the hon. Member for Canterbury has referred. This is a significant piece of guidance for the health service, in which we try to say that the drive towards "big is best" is not always the direction in which we want to travel, and that we will try to make services responsive to local people.
    In providing advice to the Secretary of State, the independent reconfiguration panel will be asked to take into account the contents of the guidance and, in particular, the three core principles that the NHS should consider when planning reconfigurations. The hon. Member for Canterbury has referred to these. They are first, the need to involve the public and staff in developing options for change. This is a big change for us. It is about saying that the public and staff should be involved in the design of services right from the outset—not just when preferred options are developed—because we believe that, in that way, the partners will sign up to change and that change will be sustainable in the longer term.
    The second principle is the need to redesign existing services rather than simply going for relocation, with primary care trusts increasingly taking the driving seat with the budgets. They are doing some incredibly innovative work on providing services closer to people's homes out in the community, and making them more accessible to people. The third principle involves trying to take a whole systems view of the whole health economy. This involves looking not simply at the role of the acute trusts, but at how they integrate with intermediate care in community hospitals and how they relate to services at primary care level. So we are looking at the whole health economy when designing services and trying at every step to work in partnership with other health providers in the area.
    The document sets out the importance of public involvement, and says that any change must have support and engagement from staff and patients. The hon. Member for Canterbury highlighted one of the most important phrases in it, which states that the NHS needed to develop options for change "with patients" and local people, rather than for them. Again, it is a real culture change for the NHS to be working together with local people. We also now have the section 11 duty under the Health and Social Care Act 2001, which provides that every part of the NHS is under a statutory duty to involve patients and the public. We have issued guidance as a result of that statutory provision, and are now beginning to develop a proper framework against which trusts can measure their proposals.
    The involvement of the public has always been a key factor in the proposals for east Kent. I know that the hon. Member for Canterbury feels that the proposals have not taken account of the views of local people, but it was a pretty comprehensive process. It aimed to
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    ensure that the proposals were widely disseminated to staff, patients and other key stakeholders. The chief executive wrote to every member of the trust's 8,000 staff, inviting their views, and all staff received a summary consultation leaflet. Three rounds of staff seminars were held at each of the trust's five hospitals, with evening seminars for night staff, and 12,000 summary leaflets were distributed to members of the public. These were available at GPs' surgeries, hospitals and pharmacies, and a range of other public outlets. The leaflet was also included in a local newspaper delivered to 227,000 households in east Kent. More than 100 voluntary groups were invited to take part in seminars, and around 2,000 people attended a series of public meetings. As the hon. Gentleman mentioned, I was delighted to visit Canterbury last July. I spoke personally to health professionals, patients and representatives of the local authorities about the proposals. It is certainly fair to say that, during the consultation, the issue was well ventilated in the community, even if the process did not deliver a result that either of the hon. Gentlemen would support.
    Mr. Brazier: I am grateful to the hon. Lady for giving way, and I am particularly grateful for the announcement that she made at the beginning of her speech. That was excellent news. However, I put it to her that, however many people went to the meetings—most of which were actively hostile—the central weakness of the whole process was that it did not involve the community hospitals and health care provision in the area as a whole. That was the explicit reason that every branch of the Royal College of Nursing in east Kent rejected it. It is now central to the Minister's own White Paper.
    Ms Blears: I am sure that that is one of the matters that the independent reconfiguration panel will want to take into account. It is part of the guidance on keeping the NHS local, and the integration of the service will clearly be a key factor for the panel.
    I want to say a little bit about the proposals, and what they mean in terms of service delivery for patients. The four shortlisted options included in the consultation document set out an important role for Kent and Canterbury. Three propose the retention of an acute hospital role, while a fourth proposes the provision of community-based services at the Canterbury site. A 24-hour nurse-led minor injuries unit would still be provided at Kent and Canterbury under all the options. I want to give local people the reassurance that the role for the Kent and Canterbury would still be substantial.
    Under all options, a number of core services would be provided at Kent and Canterbury. As well as those for minor injuries, they include day surgery, out-patient paediatrics, services for older people, community assessment, intermediate care, a day care hospital, out-patient clinics, midwifery-led services and cancer services, which are hugely important to people in that community. I want to say a word or two about those.
    First, I commend the good work done by hospital. There is a major programme of investment in cancer care, involving both equipment and staff. Recent developments include a new £1 million breast screening unit and a new £1 million linear accelerator for radiotherapy treatment, which will make an important

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    contribution to improving detection and treatment of cancer. I reassure Members that cancer services will remain a central part of the services that Kent and Canterbury will offer.
    Key points need to be made. First, Kent and Canterbury hospital is part of the Kent cancer network. It will remain so under the recommended option. The network, which is very successful, serves a population of nearly 1.8 million people, including residents of Kent, Medway and Hastings and Rother. East Kent's service for radiotherapy and chemotherapy day attendees will continue at Kent and Canterbury, supported by high-quality diagnostic and treatment services.
    Under the recommended option, Kent and Canterbury will develop an ambulatory and out-patient model of care, which will allow the vast majority of patients to continue to receive their cancer care locally. In fact, it is the model that most patients undertake now in terms of their diagnostic, screening and initial treatment options for cancer. Therefore, it is right to say that the cancer option that has been set out means that Kent and Canterbury will still be part of the Kent cancer network and will be providing high-quality services to people in the area.
    Mr. Brazier: I am most grateful to the Minister for giving way once more. Does she accept that, during the consultation process, two of the three consultants responsible for delivering those cancer services spoke out most vehemently against the weaknesses in the proposals? At the end of the process, when Professor James, who has overall responsibility from Maidstone, alleged that medical staff were in favour, the third was so angry that she too spoke out vehemently against them. No consultant at Canterbury believes that the proposal on the table would deliver long-term, viable joint cancer centre services.
    Ms Blears: I am aware that the proposals are controversial, as are the rest of the proposals for Kent and Canterbury, but I am also aware that the national cancer director, Professor Mike Richards, went down to the hospital and his information is that the consensus was perhaps larger than the hon. Gentleman suggests in terms of the reassurance given to local consultants on the quality and safety of the services that would be available. Inevitably, when there is change—I understand this—local clinicians are extremely concerned, because they have the real interest of patients at heart in trying to provide those high-quality services. In terms of the cancer network, reassurances have been given on ensuring that Kent and Canterbury remains a key part and that it can provide good-quality services to local people.
    I want to say a word or two about transport, which is another key issue. The hon. Member for Faversham and Mid-Kent has emphasised that. On my visit, I had the opportunity to travel some of the area's winding roads, so I appreciate the transport difficulties there. The matter has been reviewed by the Kent county council scrutiny committee, which has done an extremely thorough job in considering the proposals. The trust has now accepted that further work is needed on the feasibility of expanding NHS transport in the area, and
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    it will continue to work with public transport providers to try to maximise travel opportunities to the hospital sites.
    The Kent county council review found that services should be tailored to the needs of local people in terms of transport arrangements for patients and visitors. It is crucial for visitors to be able to attend hospital, as access to them is often a key factor in a patient's recovery. Such arrangements should be developed and implemented within the wider plans for reconfigurations. This is not an isolated issue in respect of east Kent, as a recent social exclusion unit report shows that people in many communities up and down the country often do not attend hospital appointments because they cannot get there using existing public transport options. We need to be much more imaginative in trying to find ways to facilitate easy access. The problems in rural areas are clearly sometimes exacerbated due to sparse rural transport.
    The response from the trust has highlighted the positive steps that have already been taken. It is working on two projects to try to improve patient and visitor access, and is examining other rural transport schemes. It has plans to implement a green transport plan to address problems on-site, and intends to carry out further work to examine whether transport links can be improved across the region. Under the options, on which, clearly, Ministers have not decided, and which are subject to advice from the independent panel, I understand that 85 per cent. of patients would still be treated at Kent and Canterbury who could normally expect to be treated there. I am not seeking to minimise the transport problem: although not everyone will have transport problems, clearly it is a significant issue in this area.
    The interim delivery strategy, to which the hon. Gentleman referred, has not been the subject of consultation and is certainly not the subject of decisions by Ministers. I am pleased, however, that he welcomes aspects of that strategy. It is being developed by a working group from the trust and the primary care trust., involving clinicians and public representatives. A draft strategy was presented to the East Kent hospitals trust board on 14 March, and three options were set out. I understand that the hon. Gentleman takes exception to the third option that has been set out, but welcomes some of the other proposals. It is an important strand of the overall programme to modernise and update services, and it demonstrates the commitment of the trust and the primary care trust, which, ultimately, will have to find the resources to sustain the changes—to make sure that services in east Kent are safe and sustainable—and, given the pressures within the system. attempt to have a best-value approach to ensure financial efficiency.
    The hon. Gentleman mentioned the financial difficulties that the area faces. Services there will benefit from an increase in investment of around 30 per cent. over the next three years, which is similar to other areas in the country—the biggest ever investment in the NHS—but I recognise the pressures that the whole health service is under. We have a long way to go in terms of increasing capacity, dare I say, after many years of under-investment and a lack of capacity in the system.

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    All three options outlined in the interim strategy will mean that Kent and Canterbury will retain a number of core services. There are proposals to enhance emergency services with the introduction of an emergency centre, under which vascular surgery, urology and clinical haematology would be provided together at Kent and Canterbury. A clear, important and sustainable role for the hospital is therefore envisaged in some of the proposals.
    In relation to the interim delivery strategy, the local health community has been engaged fully in the process to try to meet the third core principle of our new guidance: that there should be a whole systems approach to these decisions. The plans have also been shared with senior clinical staff and presented to the Canterbury and Thanet community health council.
    In conclusion, I want to say a few words about the next steps in the process, as those will be of great concern to local people. I am very conscious of the length of time that it has taken to resolve these matters. For clinicians, the public, the patients and everyone who works in the trust, certainty is very important. Although, as I have said, the matter will be referred to the independent reconfiguration panel, which is the right thing to do, we will make it clear, as a matter of urgency, that we want
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    the independent reconfiguration panel to report to us with their advice. We will be writing as a matter of urgency to the panel. We will set out the terms of referral. We will also write to the community health council chairmen who referred the case originally to inform them of the action that is being taken. We will certainly try to let local people know far as we possibly can that this matter is drawing to a conclusion. I expect the independent reconfiguration panel to look at the case quickly and to provide its advice to Ministers as a matter of urgency because, as I say, I am hugely conscious of the need to get some certainty into the process.
    Regardless of the final decision that is taken, new facilities and models of care in this area are needed. They will enable the trust to provide health care to Canterbury residents. What is important for all of us involved is that those services be sustainable in the long term. They must provide an improved and better service for patients and the local community. That is what we are all aiming to achieve for the residents of the whole of east Kent. That is our overriding duty.
    Question put and agreed to.
    Adjourned accordingly at six minutes to Nine o'clock.