Commons Sitting of 17 June 2004

Preamble
The House met at half-past Eleven o'clock
PRAYERS
[MR. SPEAKER in the Chair]
PRAYERS

  COMMISSION FOR ARCHITECTURE AND THE BUILT ENVIRONMENT
  Resolved,
  That an humble Address be presented to Her Majesty, That she will be graciously pleased to give directions that there be laid before this House a Return of the Report made by AHL Ltd in June 2004 in respect of the Commission for Architecture and the Built Environment.—[Jim Fitzpatrick.]

Oral Answers to Questions
  TREASURY
  The Chancellor of the Exchequer was asked—
  TREASURY

    Fuel Duty
    Norman Baker: What account he takes of long-term trends in the cost of motoring in deciding his policy on fuel duty rates for private vehicles.[179122]
    The Economic Secretary to the Treasury (John Healey): As with all tax decisions, my right hon. Friend the Chancellor takes into account all relevant economic, social and environmental factors, including the cost of motoring, in deciding fuel duty rates.
    Norman Baker: Has the Minister seen the information released by the Department for Transport yesterday, which confirmed that since 1974 the real-terms cost of travelling by rail has gone up by 84 per cent. and by bus by 70 per cent., but that the real cost of motoring has fallen by 5 per cent.? Those trends have continued under this Government. Is it not therefore true that bus users have more cause to complain than motorists? Is it not financially and environmentally irresponsible to argue that the normal upgrade in fuel price must be abandoned, as some on the Conservative Benches apparently want?
    John Healey: The hon. Gentleman is right. The real cost of motoring has fallen by about 8 per cent. in the past 25 years and by 5 per cent. since 1997. I am surprised that he does not give due recognition to that and congratulate the Government on what we are putting in place to support the development of public transport. We are spending £250 million a week to improve transport to make up for decades of under-
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    investment. With all due respect to the hon. Gentleman—I know that he takes a close interest in these matters—the real choice is whether we see a continuation of that long overdue substantial investment in our transport infrastructure or a return to the cuts and freezes that the shadow Chancellor has promised.
    I recognise, and I am sure that others will note, that the hon. Gentleman speaks for the Liberals on these matters and that he seems to have a policy of pricing people out of their cars and hauliers off the British roads.
    Richard Burden: I welcome what my hon. Friend has said. If we are to tackle emissions from vehicles, looking at price is one part of that, but only one part. We also need to encourage the development of environmentally friendly automotive technology, whether it be cleaner diesel or fuel cells. I welcome what the Government have already done in that respect, but is it not important to give greater incentives to British firms to develop such technology so that we reap the industrial as well as the environmental benefits?
    John Healey: My hon. Friend has a well-established and strong local interest in the future of the automotive industry. He makes the right point that it is a mistake and too simplistic to focus on the main fuel duty rates. To do so misses many of the advances that we have been making, especially through the use of fiscal instruments and other support. The reform of vehicle excise duty and company car tax has had a beneficial impact on the environment. Support for, and voluntary agreements with, the motor industry are bringing forward the new technologies that my hon. Friend is concerned about and resulting in an improvement in the efficiency of engines.
    By using duty differentials, we are able to create a shift in the fuels that are used on our roads towards greener fuels. We created a shift entirely to ultra-low sulphur fuels in 2001. We are set to do the same again in September this year with the incentive that we have planned for sulphur-free fuels.
    Mr. Roy Beggs: I welcome the Government's investment to enhance public transport and long for the completion of the trans-European networks route between Cork, Dublin, Belfast and Larne. What encouragement is being given to the Irish Republic to narrow the gap between fuel prices in the Republic and those in Northern Ireland, with a view to helping to reduce the amount of smuggling?
    John Healey: I welcome the hon. Gentleman's welcome for the increase in public investment. He will know that there is a specific public investment programme in transport in Northern Ireland. He draws attention to the real problem of oils fraud in Northern Ireland, which is the only part of the United Kingdom that shares a land border with another European Union state.
    The answer is not to look at fuel duty, because the largest part of oils fraud is the laundering and misuse of rebated fuels, on which the duty rates are more than 40p

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    lower than the road fuel rate. That is why the programme of action to counter that smuggling, laundering and misuse of oils put in place by Customs is so important. Due to the tough action and the investment that we have put in place, in the past couple of years there has been an increase of 7 per cent. in the legitimate duty-paid market for road fuels in Northern Ireland. That reverses a steep five-year decline.
    David Taylor: The whole House recognises and welcomes the progress that my hon. Friend has described in his answers so far. I note that the British motorist is taxed at about the average for EU countries, but does he acknowledge that much remains to be achieved on motoring taxation? Given the stabilisation of costs, does he accept that the alarums and excursions that are occasionally produced by some lobbies are driven more by politics than by economics or the environment?
    John Healey: My hon. Friend points to the sort of factors that my right hon. Friend the Chancellor has to take into account when making duty rate decisions. In a sense, it is most important that we have the strength to take decisions for the British economy that balance the interests of motorists and hauliers, the needs of the public services, the stability of the economy and the responsibilities we have to the environment. That is exactly what we aim to do.
    Mr. Oliver Letwin: Although the Chancellor has chosen to avoid answering this question himself, it would be churlish not to congratulate him on his long period in office. However, he has some way to go before he matches the record of Vasili Feodorovich Gurbazov, who was the Soviet finance Minister for 25 years and tragically died in office, without ever becoming Prime Minister.
    One of the hallmarks of the Chancellor's long period in office has been increasing public resentment of the fact that his big Government have given us higher taxes without any commensurate improvements in public services. Does the Minister recognise that the outrage that forced the Chancellor into retreat on his proposed fuel duty increase was just part of a mounting feeling that people are being let down by Labour's big Government, big tax rises and big failures to deliver?
    John Healey: Oh dear! I welcome the congratulations that the right hon. Gentleman offers to my right hon. Friend the Chancellor, but I remind him that during my right hon. Friend's period in office there have been five shadow Chancellors. I hope that we will not see a sixth too soon.
    When we consider our decisions on fuel duties, we will not take any advice from the Tories. If we had followed the Tory policy that we inherited, of 5 per cent. increases in road fuel duty each year, the motorist and the haulier would now be paying 14p a litre more in duty than they are.
    Mr. Letwin: I am afraid that that answer will not help people who feel let down by a Government who have given them the second highest fuel duties in Europe—not, as the hon. Member for North-West Leicestershire (David Taylor) said, somewhere near the average—and
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    an overall increase in tax of £34,000 for every minute of the Chancellor's tenure in office. Does not the Minister see that the reaction on fuel duty and the reaction on council tax are part of a pattern? Has it truly not begun to dawn on him that the taxes required to sustain the Chancellor's big, ineffective Government are now beginning to exceed the limits of what people will accept? As taxes tick up at a rate of £34,000 a minute, is it any wonder that the recent elections suggested that it might be five minutes before midnight for this Government?
    John Healey: The right hon. Gentleman is somewhat inventive, but this a question about fuel duty rates, which he did mention briefly. We understand the cause of concern for the motorist and the haulier. It is in nobody's interest that oil prices are higher than expected, but the problem is caused by world oil prices, not UK fuel duty. That is why my right hon. Friend the Chancellor has been at the forefront of discussions internationally with OPEC about oil supplies and increased oil production. That is why both the Chancellor and the Prime Minister have said that in August we will consider the progress we have made in dealing with this period of high and unsustainable prices. However, rather than the short-term and opportunistic reactions to changing events that the right hon. Gentleman demonstrates, we will not put at risk the stability of the public finances or the economy—two things that my right hon. Friend the Chancellor has worked hard to put in place over the past seven years.
    Mr. Letwin: I do not know what the Minister thought the Chancellor's retreat was if it was not short-term opportunism. I am afraid that that answer betrays a complete failure to learn the lessons of Labour's disastrous performance in the recent elections. Those elections revealed mounting concern, not only about fuel duty but about the rest of the 66 stealth tax increases. Since those elections, the Governor of the Bank of England has alerted people to the fact that the Chancellor's big Government and big borrowing are beginning—
    Mr. Speaker: Order. The question is about fuel duty.
    Mr. Letwin: Do the Chancellor and the Minister recognise that the undignified retreat on fuel duties, the recent rises in interest rates, the level of household indebtedness and the halving of the savings ratio all bear out—[Interruption.]
    Mr. Speaker: Order. Members must let the Speaker chair the proceedings I expect the Minister's response to be brief, because we are only on Question 1—and at this rate we may only get to Question 4 before the hour is up.
    John Healey: The right hon. Member for West Dorset (Mr. Letwin) quoted the Governor of the Bank of England, so let me, too, quote the Governor on the precise points that the right hon. Gentleman is trying to pray in aid against us. Last night, in his Mansion house speech, the Governor of the Bank of England said
    "the improvement in the fiscal stance in recent years has been a key element in achieving macroeconomic stability".

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    Our public finances are in good shape. The economy is growing strongly. Unemployment has fallen again this week—
    Mr. Speaker: Order. We will leave it at that.
    Dr. Vincent Cable: I, too, extend congratulations to the Chancellor for having exceeded the period in office of the last great Liberal Chancellor, Lloyd George, although not yet that of Gladstone, both of whom in fact became Prime Minister—unlike the Russian gentleman.
    In the same positive spirit, I suggest that the Government were right not to have panicked at the political demands for the immediate cancellation of the oil price increase in the face of international market instability. Which does the Minister regard as the greatest threat to the stability of the British economy: an oil price shock caused by uncertainty in the middle east or, as the Governor of the Bank of England appears to believe, a house price shock generated domestically?
    John Healey: It is neither; it is the re-election of the Conservatives.

    International Finance Facility
    Valerie Davey: What recent progress has been made on the international finance facility. [179123]
    The Chancellor of the Exchequer (Mr. Gordon Brown): We welcome the proposals at the G8 summit last week that advance our proposal for the international finance facility to double aid and halve poverty. In September, the International Monetary Fund and the World Bank will report on the proposal. I can also confirm that the Global Alliance for Vaccines and Immunisation has indicated interest in applying the principles to the next stage of its important work.
    Valerie Davey: I thank the Chancellor for that reply and for his strong international leadership in this field. The vast majority of my constituents want the Government to give a strong moral and financial lead in campaigning for global justice, so can my right hon. Friend tell them and the House how the IFF will link to and support the Commission for Africa?
    Mr. Brown: The Commission for Africa will report at the beginning of next year. It will look at proposals under which money for education, health and anti-poverty programmes in Africa can be financed. That report will contain recommendations about the financing of such proposals, including support for the IFF. Over the next few months, we shall have discussions with other countries; France and Brazil will be making a report in the next few weeks; I shall be visiting the Vatican to discuss how it can help to move the proposals forward; and I believe that many other organisations will join the 50 countries that have already given support to the facility.
    Tony Baldry: Despite the Chancellor's lead on the matter, we are unlikely to make much progress until after the US presidential election, so will he consider the Treasury working with the Department for International Development to produce a paper that could be published at the start of the United Kingdom's G8 presidency to show how long it will take, at present rates of development assistance, to reach the millennium development goals? Many people in Congress and elsewhere think that the US millennium challenge account will do it all. There is insufficient international recognition of the fact that at present levels of spending we are light years away from meeting the millennium development goals.
    Mr. Brown: I am grateful to the hon. Gentleman, who is Chairman of the Select Committee on International Development. He has played an important part internationally in giving support to the proposals. He is right: on present trends, in sub-Saharan Africa the education and anti-poverty targets will not be met until 2150—not 2015 but 150 years from now. That is why there is urgency to persuade the Americans and other countries that we must find a new mechanism to finance development aid. Support for the UK proposal is growing and I am grateful that we have support for it on an all-party basis. I believe that we can do more to win over the Churches and the non-governmental organisations, as well as Governments, and I look forward to support for the proposal from parliamentarians of all countries.
    Ms Julia Drown: Can my right hon. Friend assure the House that the important lobbying for the international finance facility will not be an excuse for this country not spending 0.7 per cent. of our gross national income on international aid? If part of the lobbying for the IFF says that nations need to mean what they say when they sign up to things such as the millennium development goals, do we not need to mean what we said when we signed up, 34 years ago, to spend 0.7 per cent. of GNI on aid? That target is achievable. Will we see it in the comprehensive spending review?
    Mr. Brown: I am grateful to my hon. Friend for taking a very big interest in these matters. She chaired a meeting that I spoke at only a few weeks ago. We have increased overseas development aid from 0.26 to 0.4 per cent., and there will be further announcements, of course, in the spending review that will report before the summer recess. There has been a real-terms increase of almost 100 per cent. in the amount of money going into development aid and, because of the untying of it, there has been a doubling and more in the aid that is going to Africa, which is the source of some of the greatest problems that she has talked about. I can assure her that we remain fixed on the goal of 0.7 per cent. I can also assure her that there will be further announcements to come. Perhaps she would note the fact that, if the Opposition had their way, they would freeze development spending in cash terms, cut it by 5 per cent. in real terms, and the percentage of overseas aid would

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    go down to the 0.26 per cent. that we had to inherit when we came to office. I hope that they will reconsider their position.
    Mr. Russell Brown: I appreciate that the IFF has been designed to front-load and meet the required targets to achieve our millennium development goals. I have heard what my right hon. Friend has said this morning, but has any real progress been made in ensuring that the other interested Governments—in particular, the United States—are as committed to what we in this country are trying to achieve?
    Mr. Brown: The reason I wanted to deal with this question after the G8 meeting is that progress was made on debt relief for the poorest countries. The G8 decided only last week to provide the necessary financing for the completion of the debt initiative, so progress is being made on one specific aspect that would come under the IFF. I believe that there is also general agreement that, if Africa is to make the necessary reforms, support for education, health and anti-poverty programmes must be provided. I think that my hon. Friend will know that 50 countries have already supported the proposals. I look forward over the next year, particularly in our presidency, to achieving far wider support for the IFF. It is one of the means by which we can indeed meet the 2015 millennium development goals.

    Plastic Bags
    Dr. John Pugh: What studies the Treasury has made of the environmental benefits of a plastic bag tax. [179124]
    The Economic Secretary to the Treasury (John Healey): The Government conducted an assessment of a plastic bag tax in December 2002. A copy of the report is in the Library.
    Dr. Pugh: I thank the hon. Gentleman for that answer; I will study the report. Do Ministers agree that our environmental taxation must be evidence-based and, in respect of plastic bag use, take into account reuse, recycling and the disposal costs of substitute packaging?
    John Healey: The hon. Gentleman is right in principle and right on the detail. Of course, we make great efforts to ensure that any development of any fiscal decision is evidence-based. That is in part why we conducted an assessment of a plastic bag tax, including in Ireland. I think that he will find that the factors that he mentions are covered in that report, when he gets around to reading it.
    Mr. Kevan Jones: Will my hon. Friend join me in congratulating Durham county council on working with major food retailers in the county—such as Tesco, Sainbury's and the Co-operative Society—not only to encourage customers to reuse their carrier bags, but to provide biodegradable carrier bags? Does he agree that that is a better way forward than slapping an arbitrary tax on shoppers?
    John Healey: We are keen to see precisely those sorts of initiatives and innovations, and I certainly welcome the moves that have been made in my hon. Friend's area both by the Co-op and by his local council. Beyond plastic bags, it is true that councils more generally are making a real effort and real progress in reducing the amount of waste and increasing the amount of recycling. That is certainly the direction that we need to encourage.

    Gershon Review
    Mr. Jonathan Djanogly: What discussions he has had with Sir Peter Gershon regarding the total savings in public sector employment within the Department for Work and Pensions as a result of his efficiency review. [179125]
    The Chancellor of the Exchequer (Mr. Gordon Brown): I will report further on my discussions with Sir Peter Gershon when I make the spending round announcements. It has already been agreed that there will be 30,000 fewer staff posts at the Department for Work and Pensions. Some 10,000 staff will be redeployed, and numbers will fall from 130,000 to 100,000.
    Mr. Djanogly: But is this not yet another example of the Government's mismanagement of the public sector? They have been spending millions of taxpayers' pounds to create tens of thousands of public sector jobs only to be told by the likes of Sir Peter Gershon that there are too many workers and that they are often working in the wrong places. Does the Chancellor agree that a better run Department would have saved the costs of recruitment, training and 40,000 redundancies if it had not created the jobs in the first place?
    Mr. Brown: The hon. Gentleman complains about the expansion of public sector jobs, but let me remind the House of his election pledges:
    "Increase police numbers in Huntingdonshire … Improve local roads … Expand … hospital and fund extra schools and pensions … Improve our leisure, shopping and children's facilities."
    If that is not a demand for extra public spending from the Conservatives, what is?
    Mrs. Joan Humble: Is my right hon. Friend aware that thousands of people in Blackpool and along the Fylde coast work hard for the Department for Work and Pensions, and does he acknowledge that that hard work is delivering essential services? At Warbreck house, people are delivering disability living allowance and the pensions agency is operating at Mexford house. A variety of different services are carried out at Norcross. Does the Chancellor understand that the people who work in those places are anxious about their future? Will he make sure that there is full and meaningful consultation with trade unions and employees to ensure that essential jobs remain and services continue?
    Mr. Brown: It was precisely because Sir Peter Gershon gave us accurate information on job reductions and savings, and said that if we went further than that we

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    could put services at risk, that we came to the decision about the numbers that I have announced. We are being sensitive, and when I announced the figures in the Budget I paid tribute to the work done in the Department for Work and Pensions. I know that the Department employs many people in my hon. Friend's constituency who do an excellent job for the service. We have invested £2 billion in new technology, which allows us to cut the number of staff in back-office services. However, there will also be 10,000 additional personal advisers so that the front-line work of the service will continue and, indeed, be enhanced so that more people can get back to work.
    Sir John Butterfill: Do the employment figures that the Chancellor cited take account of the anticipated employment costs of the pension protection fund and the new office of the regulator? If not, what does the Chancellor anticipate that they will be?
    Mr. Brown: These figures are for the Department as a whole. The individual figures on the administration of the pension protection fund will be announced in due course by the Secretary of State for Work and Pensions. We are determined to honour our commitment to make the pension protection fund work. Of course, we have also set aside money to deal with people who cruelly lost their pensions through no fault of their own under previous arrangements.
    I must tell the hon. Gentleman that our investment in the Department for Work and Pensions ensures that we have a better service for those who want the pension credit and those who are looking for jobs. At the same time as we are making the savings, we are ensuring that there is a proper service for everyone who depends on the Department.
    Angela Eagle: Does my right hon. Friend agree that we are in a period of economic stability with record low unemployment—recent figures show that it is 2.8 per cent.—compared with the period of mass unemployment under the Conservative Government? Does he agree that that gives us an historic chance to restructure the Department for Work and Pensions to help to create even more active labour market policies and ensure that those for whom finding work has been difficult, because their access to the labour market has been beset by problems such as discrimination, are now given the first chance in many years for a meaningful life at work?
    Mr. Brown: As my hon. Friend knows, the Department for Work and Pensions is expanding its services to help lone parents to get into work, to help people with disabilities to find jobs and to help people from ethnic minorities who have often felt discriminated against in the labour market. It will offer a specific service to those people who want to get skills. A big expansion is taking place in the service. My hon. Friend is absolutely right—we are determined to achieve full employment in our country. When Conservative Members intervene in this debate, they should congratulate us on having the lowest unemployment for 30 years.
    Mr. Howard Flight: When will the Government publish the Gershon report promised in April, and what proposals do Gershon or the Chancellor have to address the problem identified by the Public Accounts Committee that one in five welfare payment decisions by the Department for Work and Pensions are incorrect, leading to up to £7 billion per annum of benefits being paid out wrongly?
    Mr. Brown: It is precisely because of problems that have been identified in the past that we have taken action. Compared with the position under the previous Government, the percentage of inaccurate payments has gone down under this Government. I hope that the hon. Gentleman is not suggesting that in removing 40,000 gross jobs, or 30,000 net jobs, we are not going far enough in public sector reform. Indeed, no other Government have announced such a staff reduction in one Budget, so he should applaud us for taking action on efficiency, where his predecessors failed.
    Rob Marris: Is my right hon. Friend aware that the Work and Pensions Committee, on which I serve, is currently carrying out an inquiry into computerisation, which he mentioned? Some of the evidence submitted to the inquiry suggests that his figures are very ambitious. Can he assure the House that when the Committee's report is finally published the Treasury will look at it very carefully?
    Mr. Brown: The Treasury looks at everything very carefully, so I can assure my hon. Friend that we will examine the report and, after representations from the relevant Minister, we will discuss with him what should happen next. Despite the fact that we have to make announcements about job reductions, it is right to pay tribute to the tremendous success of the new deal and the Employment Service—now Jobcentre Plus—in creating job opportunities. Again, I should have thought that the shadow Chancellor would want to congratulate us, because in his constituency there are only seven people who are long-term unemployed.

    Combined Heat and Power
    Miss Anne McIntosh: What representations he has received from the combined heat and power sector on the removal of fiscal incentives to develop CHP installations; and if he will make a statement. [179126]
    The Economic Secretary to the Treasury (John Healey): We have not received any representations from the combined heat and power sector on the removal of fiscal incentives, and have no plans to remove them. Indeed, on the contrary, only last year we introduced an exemption for good quality CHP from the climate change levy, and were strongly encouraged to do so by the industry.
    Miss McIntosh: While it is true that the Government have granted an exemption from the climate change levy, it is equally true that they are imposing an obligation on CHP operators to purchase renewables obligation certificates, which has created a barrier to entry and has affected the ability of existing CHP

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    operators to remain in operation. It has led to a haemorrhaging of jobs and investment. Therefore, will the Chancellor urge the Government to keep clause 120 of the Energy Bill and make sure that operators are not subject to that irksome fiscal obligation?
    John Healey: No. If we did so, we would reduce the capacity to deliver the renewables obligation. There is a distinction to be made between CHP as a fairly mature technology and the renewable technologies that the renewables obligation is designed to promote. A wide range of measures is already in place to support CHP, including fiscal, grant and regulatory measures. At present, there is an increase in CHP generating capacity, but of course we keep such progress under constant review.
    Mr. Barry Sheerman: Did my hon. Friend see the remarks by the chairman of Shell yesterday about the perils of global warming? If we do not take more action not only on CHP but on generating energy from waste programmes, such as incineration and many other things, and if there are no fiscal incentives to stop dependency on one source of energy, the country and the planet will run into dreadful problems.
    John Healey: My hon. Friend is an expert in this area, so he knows that we aim to meet the target of the CHP sector of supplying 10 GW of generation by 2010. On the wider question of waste, he knows that we are putting in place a range of policy support instruments so that we can reduce the amount of waste created, boost recycling and achieve greater capacity to deal with waste in more environmentally friendly ways.

    Inland Revenue Office (Hebburn)
    Mr. Stephen Hepburn: If he will make a statement on the future of the Inland Revenue office in Hebburn. [179128]
    The Paymaster General (Dawn Primarolo): The Inland Revenue building in Hebburn is due to be vacated in March 2005. That is part of a long-term strategy to develop the Newcastle estate that began in 1995 to rationalise the number of sites in Tyneside. The building in Hebburn is leased and the lease will expire in June 2006. The building will be fully vacated in March 2005 and the current plans are that it will be used for contingency purposes between then and the expiry of the lease.
    Mr. Hepburn: As part of those plans, 700 jobs will be relocated from Hebburn to Newcastle, which is not only an outright waste of money, but will do the utmost damage to the shopping centre and the local economy in Hebburn. Will my right hon. Friend review the plans, and is she willing to meet a small delegation from the constituency to discuss the matter further?
    Dawn Primarolo: As I explained to my hon. Friend, the plans have been under discussion since 1995, in order to provide modern accommodation for the Inland Revenue and the Department for Work and Pensions. Those Departments are committed to remain and to
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    employ people from the south Tyneside region, and there will be no job losses as a result of the relocation. I know that my hon. Friend has followed the matter keenly, and I would be more than happy to meet him to review a constructive way forward for the redevelopment of the site—a subject that I know he has raised with other Ministers.

    Africa (Debt Relief)
    Andy Burnham: What recent steps he has taken towards the cancellation of debt in Africa's poorest countries. [179129]
    The Chancellor of the Exchequer (Mr. Gordon Brown): Debt relief of more than $70 billion has already been agreed for 27 countries, mainly African countries, under the HIPC—heavily indebted poor countries—initiative. Last week, at the G8 Heads of State meeting we extended the HIPC initiative by another two years, and it was agreed that more finance was required for debt relief. Both will be of special help to the African countries.
    Andy Burnham: I welcome last week's decision of the G8, but does my right hon. Friend share my view that the HIPC initiative needs to go much further and much faster, specifically in providing 100 per cent. debt relief to the poorest African countries, and in bringing in countries currently outside HIPC, particularly Sudan, from where we see terrible images of suffering on our TV screens every evening? When Britain assumes the chair of the G8 next year, will it make this—
    Mr. Speaker: Order. One supplementary is fine.
    Mr. Brown: My hon. Friend has taken a great interest in these matters, and I thank him. He has rightly pointed out that more help is urgently needed for Sudan, and he will be pleased that my right hon. Friend the Secretary of State for International Development has not only announced more money for Sudan, but is carefully looking at what more we can do, both bilaterally and internationally. In their wisdom the G8 Heads of Government asked the G8 Finance Ministers to look further at what more could be done on debt relief. In addition to extending what was called the sunset date for the HIPC countries, and to provide the necessary financing for completion of the initiative, we were asked to consider measures that can further help the poorest countries address the sustainability of debt. I hope that we can publish a report on that and get action on it before the beginning of next year.
    Mr. Mark Field: Although I accept the superficial attraction of debt cancellation in African countries, I am sure the Chancellor is well aware that in many ways it gives the wrong signals to the next generation of dictators in those countries when they see debt being written off in that way. Is the Chancellor ensuring that G8 countries are not just considering debt cancellation but encouraging free trade with those countries, to allow their economies to expand in the years and decades ahead?
    Mr. Brown: Debt relief is not unconditional. It carries with it certain obligations on the part of the countries concerned. The hon. Gentleman should agree with me that the initiative proposed around the international finance facility and part of the new plan for Africa is that in return for African countries opening up to trade, dealing with their problems of corruption and moving to monetary and fiscal regimes that make sense in the modern world, we will provide extra money for health, education and anti-poverty programmes. That is the right way forward. It is based on the Monterrey agreement two years ago, and it is important to understand that it is the relationship between developing African countries and the industrialised world that holds the key to the way forward. That includes a settlement of the Doha round of the world trade talks.
    Mr. Tom Clarke: I welcome the achievements at the G8 summit, but in view of the apparent opposition of Germany and Japan to the Government's original proposals, will my right hon. Friend consider the possibility of a 10-year moratorium on debt servicing, so that we can achieve those vital millennium goals?
    Mr. Brown: I am grateful to my right hon. Friend, who has been very active in this area over many years. A debt-servicing moratorium would place no conditions on the countries concerned to use the money for health and education as we would like. One of the great achievements of the HIPC scheme is that large sums of money have been spent on health and education that would otherwise have gone on debt servicing payments. I should like a more comprehensive agreement with the poorer countries whereby in return for the finance that we provide, including the writing off of debts, they take the action necessary to invest in their health and education systems and to deal with problems of corruption and stability. I believe that there is a wish in Africa—my right hon. Friend meets many people from that continent, and has visited it—for that new relationship to work, and that the best way forward is not unconditional support, but a new contract or covenant between the richest and the poorest countries.
    Ann McKechin: I, too, congratulate my right hon. Friend on his tremendous efforts involving debt relief in the international community. As he is aware, however, for many African countries there is no prospect of reaching the millennium development goals by 2015; in fact, on current projections some of them will take more than 100 years to reach those targets, to which the international community has committed itself. Given that writing off the rest of the debt would, in the case of the United Kingdom, mean only a few extra pounds per year from each taxpayer, is there not a pressing burden on us to consider further relief at the earliest opportunity?
    Mr. Brown: I am grateful to my hon. Friend, who has often petitioned me on these issues. One of the millennium development goals is to ensure that primary school education is a right for all people. It would cost the world only $10 billion a year to finance that basic
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    right for 120 million children, two-thirds of whom are girls. I believe that it is possible to do that if we devise new forms of financing, such as the international finance facility, so as to ensure that all countries contribute, that the proposal does not fail if one country is excluded or does not want to take part, and that the money comes immediately and is therefore front-loaded. That innovative way of financing the development of education, then of health and work on AIDS, is the best way forward if we are to move quickly to meet the millennium development goals that my hon. Friend mentioned.

    Gershon Review
    Mr. David Cameron: What discussions he has had with Sir Peter Gershon regarding the total savings in departmental expenditure in the Department of Trade and Industry as a result of his efficiency review. [179130]
    The Chief Secretary to the Treasury (Mr. Paul Boateng): The efficiency review features in regular discussions involving Treasury Ministers, their Department of Trade and Industry counterparts and Sir Peter Gershon, in order to maximise the benefits of the review for front-line services.
    Mr. Cameron: Now that the DTI no longer runs car companies, coal mines, power stations, steel mills or any other major businesses, will the Chief Secretary explain why it still needs seven Ministers, with seven private offices? Apart from providing a perk for some of the Chancellor's acolytes, what does it actually do?
    Mr. Boateng: Those Ministers do a very great deal. They have responsibility for energy policy and for promoting competition and enterprise. Importantly, too, they have responsibility for the Small Business Service, which helps some 600,000 small and medium-sized businesses—even some, I suspect, in the hon. Gentleman's constituency, and certainly some in his county.
    Tony Wright: I welcome the Government's commitment to robust public sector efficiency reforms, but it has given Opposition Members an opportunity to launch a general attack on civil servants. Civil servants are not to be associated with waste and inefficiency, and it is not good merely to laud front-line public servants and thereby attack back-office staff. Will my right hon. Friend give the assurance that whatever cuts are made, a mechanism will be in place to ensure that service quality is maintained?
    Mr. Boateng: Service quality and support for front-line workers are at the heart of our approach to the efficiency agenda. My right hon. Friend the Chancellor has already paid tribute to the work and dedication of our public servants, and I am happy to do so again. We should compare and contrast that with the approach of the shadow Chief Secretary, the hon. Member for Arundel and South Downs (Mr. Flight), whose calumnies against public servants, suggesting that they are there to do as little as possible, are legendary. We support front-line services and the contribution that

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    civil servants make to the delivery of those services, while believing that there are real efficiency gains that we are determined to obtain from the system.
    Mr. David Laws: Given the amount of money that Department of Trade and Industry Ministers, rather than civil servants, waste, would not it be better to scrap the Department and make savings that could be used for front-line public services?
    Mr. Boateng: No it would not—and I have found no support for that proposal from any section of industry. There is certainly no support for it from the Confederation of British Industry or the Trades Union Congress. My right hon. Friend the Secretary of State for Trade and Industry does a superb job in promoting British business, productivity and employment. She and the Department should be congratulated on that.
    Mr. Andrew Love: The efficiency savings are partly to achieve the Lyons review total of 20,000 civil servants to be shifted out of the capital. Are we still on track for achieving that goal? Is there any scope for increasing the number of civil servants who could move?
    Mr. Boateng: We are on track for achieving the goal, and my right hon. Friend the Chancellor will make announcements about that as part of the spending review. The Department of Trade and Industry has made a commitment to reduce its headquarters staff by some 450 posts by 2006. That programme is already well under way, and we expect still more from the Dept.

    Equitable Life
    Mr Andrew Mackay: What representations he has received from Equitable Life policyholders about the operation of the regulatory system with regard to Equitable Life. [179132]
    The Financial Secretary to the Treasury (Ruth Kelly): The Government have received several representations about a range of Equitable Life issues. I am announcing today, by written statement, the Government's decision on price caps for stakeholder products. For the deposit account product, the cap will be 1 per cent. below the Bank of England base rate. For medium-term and pension products, the cap will be set at an annual management charge of 1.5 per cent. for the first 10 years of the product and 1 per cent. thereafter. The consultation document is available in the Libraries of both Houses and the Vote Office.
    Mr. Mackay: Perhaps we can revert to the subject of Equitable Life, rather than a reply to a question that I did not ask and a statement that should have been made separately. Has the Financial Secretary noticed that the grass grows very long at this time of year, and it is easy to kick problems such as Equitable Life into it? When will policyholders be properly compensated? When will the Government stop hiding behind others?
    Ruth Kelly: First, I told hon. Members that I had tabled a written statement on stakeholder products. Secondly, that is fundamentally important to people
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    who save in the pensions industry and to future trust in the financial services industry. It relates directly to Equitable Life, among other issues.
    However, the right hon. Gentleman asked about compensation for Equitable Life members, so let me deal with that. We commissioned Lord Penrose to conduct an independent inquiry into the circumstances that led to the events at Equitable Life. He found no evidence of maladministration or negligence. He made no recommendation for compensation and, indeed, made it clear that:
    "Principally the Society was the author of its own misfortunes … The regulatory system failures were secondary"
    factors. Although I have every sympathy with the victims of events at Equitable Life, it would not be right, given the circumstances, for the Government to consider compensation.
    Mr. Harry Barnes: Even if we were not to blame for the collapse of Equitable Life or the failure of the regulatory system, can we not have a compensation scheme based on need?
    Ruth Kelly: I understand my hon. Friend's point. However, people who invested in Equitable Life did so of their own free choice. The position is different from that of members of failed company pension schemes such as Allied Steel and Wire, which we have debated long and hard in the Chamber. Investors in Equitable Life tend to have supplementary pension provision, and many members have large pension pots, though others have smaller pots. It is largely their expectations that have been disappointed. I sympathise with people whose expectations have been disappointed, but Equitable Life continues in business and continues to fulfil its guaranteed obligations. If insolvency were to occur, we have a clear mechanism for providing compensation.
    Mr. Eric Forth: May I give the Minister a chance to answer the question? She was asked what representations she had had from Equitable Life policyholders, and the House would like to know the answer. Can she also give us a positive response to the question that has so often been asked about the role of the ombudsman? When will she give the ombudsman an opportunity to look into this matter again, to satisfy so many frustrated Equitable Life policyholders?
    Ruth Kelly: I have had many representations on the subject of Equitable Life. Indeed, I have met the action groups representing the policyholders. One of the points that we have discussed is the need for comprehensive, efficient regulatory systems. Through the formation of the Financial Services Authority, the single ombudsman scheme and the single comprehensive financial services compensation scheme, we have already put in place an advanced, forward-looking system to protect consumers. The right hon. Gentleman referred to the ombudsman. Yes, it is perfectly within an individual's rights to take their case to the ombudsman, but I am not here to stand up and offer advice to the ombudsman. People will have to make their own decisions.
    Mr. Andrew Tyrie: I am very interested in that last remark—that the Minister is not prepared to offer advice to the ombudsman. As the whole House knows, the parliamentary ombudsman has invited submissions on whether she should reopen her inquiry. She must be aware that the hundreds of thousands of policyholders who have lost out now believe that the Government and the Treasury are quietly lobbying the ombudsman not to reopen her inquiry. Will the Minister tell the House whether she has made a submission to the ombudsman—yes or no? If she has, why has she not published it, and had she not better do so immediately?
    Ruth Kelly: I am glad that the hon. Gentleman made it clear that he was referring to the parliamentary ombudsman. Of course, I was referring to the financial services ombudsman. The parliamentary ombudsman is an independent officer of the House and it would be inappropriate for me to try to push her in one direction or another. However, she has come to the Treasury and asked for a submission about our case, and we have put forward our view, as requested. She is perfectly at liberty to publish that submission if she so chooses.

    Carbon Emissions
    Mr. Colin Challen: What fiscal measures his Department is taking to reduce carbon emissions from road transport. [179133]
    The Economic Secretary to the Treasury (John Healey): The Government have introduced a range of fiscal instruments to reduce carbon emissions from road transport, including restructuring vehicle excise duty, reforming company car tax and introducing duty differentials to support the use of cleaner fuels.
    Mr. Challen: I thank my hon. Friend for that reply. May I commend to him early-day motion 527 on the way to go proposals? As he will know, environmental justice and social justice often go hand in hand, and the way to go campaign's document, "Paying for Better Transport", contains many detailed proposals for achieving both those aims at one fell swoop. Will he read the document carefully, as is the Treasury's usual very principled way of dealing with such matters, and come back with some answers to the campaign's proposals?
    John Healey: I welcome this further interest in environmental issues. I am normally seen as the Minister for booze cruises and fag flights, but I will indeed study the proposals that my hon. Friend mentioned and ensure that the campaign receives a full response. I have noted the support that it has in the House, including that of my hon. Friend.
    Lawrie Quinn: Has my hon. Friend considered the possibilities of modal switch away from road to other modes of transport? With that in mind, has he given particular consideration to the freight sector, and to whether some fiscal incentive for the rail freight industry might help to reduce carbon emissions from road use?
    John Healey: Clearly, policy for transport modal switches is less my responsibility than that of my right hon. and hon. Friends in the Department for Transport. My hon. Friend the Member for Scarborough and Whitby (Lawrie Quinn) will lead a delegation from the rail freight industry that is coming to see me next week, and the point that he has raised is no doubt one that the industry will want to make at the meeting. I look forward to seeing him and his colleagues from the industry then.

    National Insurance
    Mr. Peter Pike: What revenue his Department estimates would be received by HM Treasury if the ceiling were to be removed on national insurance contributions on earnings in a full financial year. [179134]
    The Paymaster General (Dawn Primarolo): The estimate provided by the Government Actuary's Department is £5.6 billion in 2004–05.
    Mr. Pike: I thank my right hon. Friend for that answer. That is a lot of money. Remembering that the Treasury team believe that this Government are best when we are a Labour Government, can we not remove that ceiling, so that we can do more to help the poorer people in this country and spend more on the health service and other such matters?
    Dawn Primarolo: As my hon. Friend will know, all those matters are for the Chancellor to consider in the Budget. With regard to pensions, however, the £10 billion extra includes £5 billion more on the poorest one third of pensioners. There is a commitment in relation to the 1 per cent. national insurance contribution rise to secure substantial and sustained increases in the national health service. That will provide investment in more nurses, more doctors and 100 more hospitals, to ensure that we have the health service to which people in this country aspire.
    Gregory Barker: Removing the ceiling would be another massive tax rise, but there have already been 66 tax rises under the Labour Government. How many more tax rises will there be before this Parliament is out?
    Dawn Primarolo: I will not be taking prompts from the hon. Gentleman about tax rises, given his party's record when in government. Nor will I be taking any prompts for cuts in the public services, which his party is suggesting. We will continue the sustained investment to provide the education, health service and transport system that the people of this country want.

    Interest Rates
    Sir Nicholas Winterton: What discussions he has had with the Governor of the Bank of England on the current level of interest rates. [179135]
    The Chancellor of the Exchequer (Mr. Gordon Brown): I meet the Governor regularly, but the level of interest rates is entirely a matter for the Monetary Policy Committee of the Bank of England.
    Sir Nicholas Winterton: I am grateful to the Chancellor for that factual and accurate response to my question. Is he aware of the views of the British Chambers of Commerce on interest rates? Although it agrees that small interest rate rises may be necessary to curb inflationary features in our economy, it is also concerned that excessive interest rate rises would have a devastating effect on manufacturing industry, and might not even curb house price inflation, which is one of the problems that this country is facing.
    Mr. Brown: I meet representatives of the British Chambers of Commerce regularly, and I last met its president only a few days ago. I listen seriously to what it says. It wants low inflation, which has been achieved, low interest rates, which have been achieved, and low unemployment, which has also been achieved. I thought that the hon. Gentleman was going to thank me for the 63 per cent. drop in unemployment in his constituency since we came to power.
    Ms Sally Keeble: May I tell my right hon. Friend that the east midlands regional agent for the Bank of England recently visited my constituency, where he met people from several businesses, including some manufacturers who were more optimistic than they have been for a considerable time and reported improvements in performance, because of both the stability that they have had and low interest rates? If he intends to vary the inflation targets for the Bank of England, will he take carefully into account the needs of manufacturing industry, and will he welcome the improvements in performance in the east midlands region?
    Mr. Brown: I am grateful to my hon. Friend, who takes a big interest in questions of manufacturing and the state of the economy. I agree that although manufacturing output has been rising, we wish to see more progress. The important thing is that we have and maintain economic stability. She will be as pleased as I am that the rate of unemployment in her constituency has been halved under a Labour Government.
    Mr. Nick Gibb: As a full-blooded and committed monetarist, the Chancellor will be more aware than many of the power and the effect that even small interest rate rises can have on the level of demand in the economy. Does he therefore share concerns about the Monetary Policy Committee's apparent fixation on house prices, and the potential damage to the real economy that excessive interest rate rises could have if implemented before the impact of recent rate rises fully takes effect?
    Mr. Brown: If the hon. Gentleman wants to keep interest rates low, he will want to maintain a Labour Government. The average interest rate under the
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    Conservative Governments from 1979 to 1997 was 10.3 per cent., and interest rates have been less than half that under a Labour Government. I seem to remember that when we made the Bank of England independent, he said:
    "The decision to give the Bank of England independence … will, in due course, lead to unemployment increasing."—[Official Report, 11 November 1997; Vol. 300, c. 791.]
    We have created 2 million jobs and halved unemployment.

    Transport (London)
    Roger Casale: What representations he has received in the context of the comprehensive spending review on increasing investment in transport infrastructure in London. [179137]
    The Chief Secretary to the Treasury (Mr. Paul Boateng): Representations on investment in London's transport have been received from a wide cross-section of organisations and individuals.
    Roger Casale: My constituents recognise that there has been substantial investment in south-west London by the Government in the Merton-Croydon tram link, in new rolling stock and stations on the Northern line by Transport for London, and in rolling stock and stations by South West Trains. But does my right hon. Friend accept that if we are to keep pace with the extraordinary growth of business activity and employment, and to attract important international events such as the Olympics to London, it is important for us to proceed with projects such as Crossrail 1 and 2 and the east London line? The Government must give a strong lead in that regard. Will my right hon. Friend take account of those representations, and seek to invest as much as he can in transport infrastructure in London through the comprehensive spending review?
    Mr. Boateng: We take all representations into account. We have already invested some £15 billion in London's transport infrastructure since 1997, and that is delivering the real results that my hon. Friend has identified in his constituency. We welcome his interest in transport and the Olympics, and in that context we should remind ourselves of the International Olympic Committee's comment that London has one of the most extensive rail and underground systems in the world. The committee says that its main transport infrastructure ratio is one of the highest among all the applicant cities.
    Between now and 2012—irrespective of whether we win the Olympics bid—we intend to invest more than £18 billion in London's transport. That is a good record, which should be compared and contrasted with the record of the Conservatives.

Business of the House
12.31 pm
Mr. Oliver Heald: Will the Leader of the House please give us the business for next week?
The Leader of the House of Commons (Mr. Peter Hain): The business for next week will be as follows.
MONDAY 21 JUNE—Second Reading of the Health Protection Agency Bill [Lords].
TUESDAY 22 JUNE—Opposition day [13th allotted day]. There will be a debate entitled "Threat to the Integrity of the Electoral System", followed by a debate on NHS recruitment and retention. Both debates arise on an Opposition motion.
WEDNESDAY 23 JUNE—Motion to approve a Ways and Means resolution on the Domestic Violence, Crime and Victims Bill [Lords], followed by motions to approve the appointment of managing trustees to the parliamentary contributory pension fund and the House of Commons Members' fund, followed by, if necessary, consideration of Lords amendments.
THURSDAY 24 JUNE—Estimates [3rd Allotted Day]. There will be a debate on the Highways Agency and a debate on taxis and private hire vehicles. Details will be given in the Official Report.
At 6 pm the House will be asked to agree all outstanding estimates.
FRIDAY 25 JUNE—The House will not be sitting.
The provisional business for the following week will be:
MONDAY 28 JUNE—Proceedings on the Consolidated Fund (Appropriation) Bill, followed by remaining stages of the Human Tissue Bill.
TUESDAY 29 JUNE—A debate on London schools on a motion for the Adjournment of the House, followed by a motion to take note of the outstanding reports of the Public Accounts Committee to which the Government have replied. Details will be given in the Official Report.
WEDNESDAY 30 JUNE—Opposition day [14th allotted day]. There will be a debate on an Opposition motion. Subject to be announced.
THURSDAY 1 JULY—A debate on Zimbabwe on a motion for the Adjournment of the House.
FRIDAY 2 JULY—The House will not be sitting.
Following are the details: Thursday 24 June—Estimates to be considered: Central Government Supply Estimates 2004–05 (HC 466); House of Commons: Administration Main Supply Estimate 2004–05 (HC 467); National Audit Office Main Supply Estimate 2004–05 (HC 468); Electoral Commission Main Supply Estimate 2004–05 (HC 469).
Tuesday 29 June—outstanding PAC reports 2003–04 to be considered: 1st report, "Tackling fraud against the Inland Revenue" (HC 62) (Cm 6130); 2nd report, "The new electricity trading arrangements in England and Wales" (HC 63) (Cm 6130); 3rd report, "The Sheep Annual Premium Scheme" (HC 64) (Cm 6136); 4th report, "Improving service delivery: the Forensic Science Service" (HC 137) (Cm 6155): 5th report, "Warm Front: helping to combat fuel poverty" (HC 206)
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(Cm 6175); 6th report, "Department of Trade and Industry: Regional Grants in England" (HC 207) (Cm 6155); 7th report, "Progress on 15 major capital projects funded by Arts Council England" (HC 253) (Cm 6155); 8th report, "The English national stadium project at Wembley" (HC 254) (Cm 6155); 9th report, "Review of grants made to the National Coalition of Anti-Deportation Campaigns" (HC 305) (Cm 6175); 10th report, "Purchasing and managing software licences" (HC 306) (Cm 6175); 11th report, "Helping consumers benefit from competition in telecommunications" (HC 405) (Cm 6191); 12th report, "Getting it right, putting it right: Improving decision-making and appeals in social security benefits" (HC 406) (Cm 6191); 14th report, "Inland Revenue: Tax Credits" (HC 89) (Cm tbc); 15th report, "Procurement of vaccines by the Department of Health" (HC 429) (Cm tbc); 16th report, "Progress in improving the medical assessment of incapacity and disability benefits" (HC 120) (Cm 6191); 18th report, "PFI: The new headquarters for the Home Office" (HC 501) (Cm tbc); 19th report, "Making a difference: Performance of maintained secondary schools in England" (HC 104) (Cm tbc).
The House may wish to be reminded that, subject to the progress of business, the House will rise for the summer recess at the end of business on Thursday 22 July and return on Tuesday 7 September.
Mr. Heald: I thank the Leader of the House for announcing the business, and in particular for announcing the debate on Zimbabwe. Can he confirm that there will be a statement from the Prime Minister on Monday about the intergovernmental conference?
Does the right hon. Gentleman recall that he got into a bit of trouble last year when he said he was quite happy
"to fight the … European elections on a Labour platform endorsing"
the European constitution? He said
"the Conservatives can oppose it and then the people will decide."
Now that the majority have voted for parties opposed to the constitution, will the right hon. Gentleman not accept their verdict that there is no mandate to sign up to the European constitution?
The right hon. Gentleman has announced an Opposition day debate on the postal ballots fiasco. My hon. Friend the Member for Broxbourne (Dame Marion Roe) has uncovered an important aspect of that: the shocking state of electoral registers with up to 20 per cent. inaccuracies, which has led to thousands of postal ballot papers being sent out to the wrong people. In Newcastle and in Chester, even babies received postal ballot papers. The Chester Chronicle headline was, "Blair's Babe: Voting slip 16 years early". The Labour leader of Birmingham city council, Sir Albert Bore, has called for a national rethink on postal voting. [Interruption.] This is the Labour leader of the council calling for the rethink. Does the Leader of the House recognise that the advantage of a polling station is that the voter is positively identified and the scope for impersonation reduced? Will he give an assurance that the review of the all-postal experiment will be completed and debated before the Government lay the necessary orders to make this autumn's regional assembly referendums all postal?

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The right hon. Gentleman promised a draft Bill to set up regional assemblies before July. Can he reassure us that there will be a debate about the Bill before the referendums? The Prime Minister has made it clear how vital it is to have lengthy parliamentary debate before a referendum, so will the Leader of the House confirm that that applies not just to the European constitution, but to regional assemblies?
Finally, turning from bogus voters to bogus visas, can we have a debate on visa abuse and illegal immigration? Today's National Audit Office report slams the Home Office for allowing 10 times as many visa applications as embassy staff advised. Yesterday the police smashed a multi-million pound scam, involving student visas with more than 1,000 illegal entrants.
Is it not time that the Government started to listen to, and act on, advice? They are ignoring the voters on the European constitution; they ignored the Electoral Commission's advice on all-postal ballots; they ignored their own embassies' advice on immigration visas. Does the Leader of the House understand why people feel let down by Labour? Can we have a statement—a statement of apology?
Mr. Hain: You would not have thought, Mr. Speaker, from that bravura performance that the Conservatives actually lost the elections last week. [Interruption.] Yes, in comparison with the predictions of the Leader of the Opposition, as supported by Conservative Back Benchers, they did very badly indeed.
On Zimbabwe, I freely acknowledge that the hon. Gentleman, and others on both sides of the House, has been pressing me on that matter. I am pleased that we are having a debate about it, which will present an opportunity to send a message loud and clear to Robert Mugabe about what the House thinks of his despotic rule.
Yes, the Prime Minister will make a statement on Monday, following the European Council. The hon. Gentleman referred to the European elections. Of course, when I made my statement last year, there was no prospect of a referendum on the European constitutional treaty. Now there will be a referendum and we will fight it. When we do so, the pathetic Conservative policy on Europe will be exposed and it will be made very clear to the voters. One of the reasons why Conservative policy will be exposed relates to what happened last Thursday. I am surprised—no, perhaps I am not surprised—that the hon. Gentleman did not refer to the fact that a large proportion of the Conservative vote went to the United Kingdom Independence party. Some of his own Back Benchers are sympathetic to the withdrawal from Europe strategy. When the arguments are raised with the electorate, the electorate will clearly see that Britain should be at the heart of Europe under Labour and that Britain would be on a train out of Europe under the Tories.
On the issue of postal votes, the hon. Gentleman mentioned Birmingham, but there were no pilots for postal votes in Birmingham. There were local elections, but not the all-postal voting pilot arrangements that he and his colleagues consistently complain about. They
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did not apply in the west midlands. I should like to quote the joint statement from the north-west regional returning officer, Sir Howard Bernstein, and Martin Bottomley of the Greater Manchester police, who said:
"While the nature of the allegations has changed this year, the scale has not increased; if anything, it has lessened."
When we look at the facts as opposed to the hype and the rhetoric, what we see is that 14 million people were given the opportunity to vote from the comfort of their own homes. The pilots covered that scale of voters, compared with 6.5 million last year. European election turnout in pilot regions was up more than 100 per cent. Is that not a good thing for democracy? That is compared with a rise of less than 50 per cent. in non-pilot regions. The facts speak for themselves. On the specifics of when the assessment will be made, the Electoral Commission is due to report in September. The Government, led by the Department for Constitutional Affairs and the Office of the Deputy Prime Minister, are carrying out their own inquiry, and we will report to the House when those inquiries are over.
On the question of the regional assemblies Bill, that will be subject to pre-legislative scrutiny. Yesterday, I promised the Liaison Committee a timetable for that, and the expectation is that it will be published and available for pre-legislative scrutiny before the recess. That will give plenty of time for voters who will be voting on regional assemblies—and I hope that they will vote yes—to know what they are voting for, which is a voice for their own regions and, therefore, a stronger voice for their own interests.
I think that I have dealt with the matters raised, but I cannot read my own writing on the last point.
Mr. Heald: Immigration visas.
Mr. Hain: Yes, on the question of immigration visas, we have consistently put in place practices and procedures to tackle any abuses of the visa system or the immigration procedures, and the Home Secretary gave a written ministerial statement today that provides details of our response to the inquiry that was set up into what went wrong in Bulgaria and Romania. That is available for everyone to see.
Mr. Dennis Skinner: Is the Leader of the House aware that when he gave the business for the next two weeks, he also announced the recess for 22 July, which means that after the next two weeks' business, there are only three more weeks left before the long recess? He will know that I have called for the introduction of a ban on fox hunting, and we need that before the long recess. There are now three weeks available for us to show that most Labour MPs are in favour of banning hunting, most Tory MPs are in favour of the opposite, the Liberals are split down the middle—so there is nothing neater in electoral terms—and UKIP members will be fighting one another like Kilkenny cats. There is not a subject under the sun that is better suited to us, and to raising our morale in the constituencies, than a ban on fox hunting. Get on with it!
Mr. Hain: I am with my hon. Friend in sentiment all the way. As he knows, the House voted for a ban on hunting and an end to cruelty to animals by a landslide majority, and I was in the same Lobby as he, with the vast majority of my right hon. and hon. Friends. The House's view on the matter is overwhelmingly clear, and I hope that Opposition Members will give a guarantee that the Conservatives in the House of Lords will not seek again to threaten the primacy of the House of Commons on this or other matters. I can tell my hon. Friend that when the time is opportune, an announcement will be made. The Government's intention is, as I have consistently said, to resolve the matter.
Mr. Paul Tyler: May we have a statement, either before or during Tuesday's debate, on the Government's intentions or opinion polls, their use by newspapers and their potential for distortion of the electoral process? The Prime Minister's answer yesterday implied that that is simply a party matter, but I suggest that it is a much bigger issue. It affects every member of the House and the whole integrity of the political process. I draw the right hon. Gentleman's attention to early-day motion 1294, which a large number of Members on both sides have signed.
[That this House regrets the decline of self-regulation of public opinion polling companies in the United Kingdom; is deeply concerned that there are no sufficient checks on the integrity of polling or polling organisations; further expresses concern at the proliferation of non-scientific/empirical polling, in particular the use of techniques designed to secure the results favoured by those who commission the polls, and lack of transparency in the methodology employed; and calls on Her Majesty's Government to conduct a thorough investigation into the integrity, honesty and professionalism of the polling industry and, if indicated, introduce regulation.]
May I also draw the right hon. Gentleman's attention to some specifics from last week, when the poll YouGov and the Evening Standard purported to demonstrate that Messrs. Livingstone and Norris were neck and neck when they were clearly nothing of the sort? The same poll in The Daily Telegraph overestimated and grossly promoted UKIP, when that was clearly inaccurate. Finally, the exit poll, which is quite difficult to get wrong, was simply wrong. May I suggest that the whole way in which polls are regulated or self-regulated should be examined?
On a quite separate matter, will the Leader of the House see whether the Home Secretary can come to the House, next week or the week after, to discuss some very important national lessons emerging from the Caroline Dickinson murder inquiry? The right hon. Gentleman may know that the family are constituents of mine. I took John and Sue Dickinson to see a succession of Ministers about the important lessons that need to be learned from the inquiry.
The chilling truth is that, without the heroic persistence of John Dickinson and the incredibly lucky break that occurred when an immigration officer guessed what might have happened with the person found to be the culprit in due course, no case could have been brought and no conviction secured. That is a shocking reflection on the adequacy of cross-Europe co-operation.
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I do not deny for a moment that there has been a great improvement in that co-operation since 1996, and I am grateful to Ministers for their response to our lobbying on this matter. However, will the Leader of the House ask the Home Secretary to look carefully to see whether there can be greater co-ordination between the investigating forces across Europe? In particular, will he look at the question of the harmonisation of DNA testing and analysis? That has not been possible in the past, but it was a very important feature of the Dickinson case. We all know that serious crime crosses national boundaries. Crime-stoppers must do so as well.
Mr. Hain: First, I pay tribute to the way in which the hon. Gentleman stood by the Dickinson family as they went through this dreadful experience. I agree that Mr. Dickinson showed enormous persistence and courage, and great skill, in ensuring that justice was done.
It is a pretty shocking episode. The almost accidental way in which justice was eventually done exposes a series of matters, not least the question of harmonisation of DNA testing. Work on that is being done, and I know that my right hon. Friend the Home Secretary will take careful note of the interest of the hon. Gentleman in these matters, and of the points that he has raised.
The hon. Gentleman asked about opinion polls. I am sure that he does not blame those polls for the fact that the Liberal Democrat candidate in the London mayoral elections polled only 15 per cent., but he makes a fair and important point. My right hon. Friend the Prime Minister has made it clear that the chairman of the Labour party will consult with other parties on what is, as the hon. Gentleman rightly said, an all-party matter.
Joan Ruddock: Has my right hon. Friend seen the editorial in today's edition of The Daily Telegraph? It denigrates the proposals by the Modernisation Committee that people visiting the House should get a greater welcome and that the term "strangers" should no longer be used.
Mr. Eric Forth: Rubbish!
Joan Ruddock: No doubt the right hon. Gentleman agrees with the question posed by the newspaper. It asked:
"Why … should Parliament, a serious, grown-up institution, change its well tried ways to attract the attentions of those too young to be interested in it?"
Is that merely a reflection of the elderly profile of Telegraph readers, or is something more serious going on?
Mr. Hain: My parents-in-law are Telegraph readers, so I do not want to insult too many of them. However, I very much agree with my hon. Friend that the editorial was extraordinary. It began by saying:
"The heart sinks at proposals to make the House of Commons more accessible to young people."

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In our democracy, the young persons' vote is declining, as is their interest in politics. It seems that The Daily Telegraph has the enthusiastic support of the right hon. Member for Bromley and Chislehurst (Mr. Forth), the former shadow Leader of the House.
Mr. Forthindicated assent.
Mr. Hain: The right hon. Gentleman nods, from his mediaeval posture on the other side of the House. The newspaper seems to want to turn off young people and young voters. The Modernisation Committee is an all-party committee, with Conservative, Liberal Democrat and Labour members. We feel that the House of Commons should send out a loud and clear signal to all members of the public—and to young voters in particular—that this is their House of Commons. They are entitled to be able to visit it more easily, to be given a better welcome and to have their concerns addressed. A whole series of practical and radical measures have been suggested to enable Parliament to be better connected with the public. We ought to welcome that.
Sir Nicholas Winterton: I thank the Leader of the House very much for arranging the debate on Zimbabwe. I hope that the Foreign Secretary will open the debate, as it is a matter of very considerable importance. To some of us it is as important as the matters relating to Iraq, but my question is to do with how the House operates. Will the right hon. Gentleman take very seriously the problems facing many Select Committees, which are finding it difficult to get a quorum of members for important meetings? Particularly on the Government side, it appears that members of the Select Committee are being appointed to other Committees—
Chris Bryant: Nonsense.
Mr. Speaker: Order.
Sir Nicholas Winterton: Thank you very much, Mr. Speaker. Government Members are being appointed to other Committees of the House that they consider take priority over Select Committees. I believe that Select Committees are the most effective way of the House holding the Government of the day to account. Therefore, they must be of considerable importance. Will the Leader of the House turn his attention to that and have a word with his own leader of the business, as it were, namely, the Chief Whip?
Mr. Hain: The Chief Whip will have taken note of the points made by the hon. Gentleman and, especially given his seniority in the House, will want to study them carefully. The hon. Gentleman will find that in many of these instances it is a question of appointments to Standing Committees and Statutory Instrument Committees, which are very important, although I agree that Select Committees are vital for the effective functioning of the House and for holding Governments and Ministers accountable. I am happy to confirm that
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the Foreign Secretary will be opening the Zimbabwe debate. I know that the hon. Gentleman has taken an interest in the dreadful events in Zimbabwe.
Mr. Kevin Hughes: My right hon. Friend will be aware that the NHS loans out a lot of medical equipment and aids such as crutches, commodes, wheelchairs and even specialist beds, much of which is never returned. Will he ask the Health Secretary to come to the House and make a statement on the issue? Will he join me in congratulating BBC Radio Sheffield and other groups in South Yorkshire who have got together to campaign and encourage people to take such equipment back? That will save the NHS hundreds of thousands of pounds.
Mr. Hain: I am happy to congratulate BBC Radio Sheffield, on which I have been interviewed from time to time. I join him in appealing to his constituents and others to return equipment that is vital for the effective functioning of local hospitals.
Mr. Hugo Swire: The Leader of the House will have seen recent reports, which were not unsurprisingly welcomed by the House Builders Federation, that the Government plan to scrap local authority designation of protected land. The Campaign to Protect Rural England has called the plan a blow for local democracy. Given the recent controversy over the Barker report, the cynical manipulation of the green belt and the general concern about the concreting over of our countryside, will the Leader of the House provide Government time before the summer recess for a debate on this extremely important matter?
Mr. Hain: I am sorry, but I have to rebut the proposition that we seek to erode the green belt or concrete over the countryside. It is just nonsense and scaremongering. The hon. Gentleman will have seen a number of written ministerial statements that made clear what we were doing to find areas, especially brownfield sites, which were suitable for the extra housing projects that we need to fill the gap in the housing programme that has been largely bequeathed by the Conservative Government.
David Winnick: What did my right hon. Friend mean precisely when he said to my hon. Friend the Member for Bolsover (Mr. Skinner) "when the time is opportune" with regard to the use of the Parliament Act to make sure that hunting with dogs comes finally to an end? Can he be more precise? Does he understand that the question now is whether we will have the courage to end this barbaric sport once and for all? That is what the overwhelming majority of Labour Members wants and undoubtedly what a large majority of the country expects this Parliament to do before the general election.
Mr. Hain: As I have assured my hon. Friend and others, we are determined to resolve this matter.
David Winnick: When?
Mr. Hain: When the time is right, I will make an announcement.
David Winnick: What does that mean?
Mr. Hain: When the time is right, I will make an announcement. There is no attempt to avoid this issue. It is clear that what my hon. Friend described as a barbaric practice has to be ended. There is no question about that. I am with him all the way. I think that he will be encouraged when I make the announcement about how we intend to proceed.
Rev. Ian Paisley: Can the Leader of the House give the House some information about the future of the statue of the Lord Protector Oliver Cromwell, which is outside the House? He must be aware of the statements in the press that its location is to be changed. If that is so, why, when and where to?
Mr. Hain: I have not seen any proposals to change its position, so the hon. Gentleman can be reassured on that.
Kate Hoey: In welcoming the debate on Zimbabwe in Government time, may I pay tribute to the Leader of the House for the work that he has done behind the scenes to ensure that finally we have a debate? Given that the Foreign Secretary will open the debate, will he inform the House of some extra sanctions that this country might be able to impose rather than waiting for the European Union to do so? Is it possible for the House to have some form of debate to show that we do not want the England cricket team to go to Zimbabwe even to play one-day matches or the Zimbabwean team to come here in September and play at the Oval in my constituency in the International Cricket Council championships?
Mr. Hain: I am grateful to my hon. Friend for her question. As she knows, I am with her all the way in my opposition to Mugabe's regime. I know that my right hon. Friend the Foreign Secretary is extremely concerned to make sure that events change for the better for the people of Zimbabwe. He will carefully note the view that she has expressed and will want to see whether he can make any progress in the direction that she asks.
Sir George Young: Has a date for the statement by the Chancellor on the outcome of his comprehensive spending review yet appeared on the Leader's radar and if so, can he share it with us? Can he give a guarantee that before the House rises there will be a full day's debate in Government time on that statement so that the Chancellor can seek to persuade the Governor of the Bank of England that the Government's expenditure plans are sustainable?
Mr. Hain: There is no question but that the Government's expenditure plans are sustainable. That statement has been widely endorsed by economic commentators and others. As for a statement on the CSR, yes it is on my radar and no, I am not able to tell him yet when it will be.
Mr. George Howarth: My right hon. Friend will be aware that, while there is no appetite to return to regular late-night sittings and all-night sittings, there is a mood in favour of adjusting the hours as they now stand. Has he made any progress on that matter?
Mr. Hain: I thank my hon. Friend for the constructive discussions that I have had with him and the efforts that
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he has made with others to find a way forward. The Modernisation Committee met yesterday and agreed after a fairly lengthy discussion to proceed with its review, which will include taking evidence from hon. Members who have been particularly articulate in supporting one position or another. We will also take close account of the excellent Procedure Committee report, which contains a comprehensive survey of Members' opinions, with an unusually high return from Members. I thank the Procedure Committee for that.
I am anxious, as I know my hon. Friend is, to find a way of avoiding a knife-edge vote like we had last time, but I think that if we simply dropped a proposition on the table tomorrow, we would get that again. I want to find a way of addressing all the issues that have arisen in the consultations that I have had and those issues that have been drawn to the attention of the Procedure Committee and the Modernisation Committee. We want a modern approach. We do not want to roll the clock back, but we want an approach that deals with all the concerns that a large number of Members have about the present situation. That is what the Modernisation Committee will do. We shall write shortly to every hon. Member to ask whether they wish to add to our knowledge any points other than those identified by the Procedure Committee, which is chaired by the hon. Member for Macclesfield (Sir Nicholas Winterton), so that we can make a recommendation to the House.
Mr. Michael Jack: In his Mansion house speech last night, the Chancellor understandably called for an increase in the supply of housing, but unfortunately in the north-west of England, outside certain selected inner-city areas, Government housing policy is inhibiting the reuse of brownfield sites and the further supply of affordable housing. Will the Leader of the House persuade the Minister for Housing and Planning to make a statement to the House perhaps before it rises for the summer recess indicating a willingness to review policy with a view to achieving Government policy?
Mr. Hain: I am a bit puzzled by that point, because I do not recognise that situation. However, as the right hon. Gentleman represents a constituency in the north-west, he will know it better than I do. I will certainly ensure that my right hon. Friend the Minister for Housing and Planning is well seized of his points and is able to discuss them with him to discover what can be done.
Mr. Alan Hurst: The Braintree Riverside club in my constituency has been in existence since 1974. It has 150 members and provides an opportunity for older people to learn new skills in art, carving, computers, history and a range of other subjects every Friday. Up to now, the club has been supported by Braintree college, but under the new terms of the college's financial directives, it will not be able to pay the costs of £30,000 in the coming financial year. The club provides a valuable facility to the older people of Braintree. Can my right hon. Friend arrange an early debate so that lifelong learning and skills can be put at the forefront of the agenda for people in Braintree?
Mr. Hain: I acknowledge that that is an important issue for my hon. Friend's area. There will be a debate on Wednesday in which he could raise the matter further, and I hope that he will consider whether he wishes to do so.
Mr. Andrew Mackay: I also thank the Leader of the House for arranging a debate on Zimbabwe, which will give many of us an opportunity to encourage the Foreign Secretary to press internationally for deeper, sharp sanctions against the Mugabe regime.
The situation in Iraq is clearly deteriorating rapidly. I put it to the Leader of the House that the occasional statement, though welcome, from the Prime Minister, the Foreign Secretary or the Secretary of State for Defence is not enough, and we need to have another debate on Iraq soon.
Mr. Hain: I am sympathetic to the right hon. Gentleman's request and discussions are taking place. Clearly, the situation in Iraq is now entering a different position, with the handover of power to the Iraqis themselves and the prospect of elections to follow next year. It would be a good opportunity for the House to discuss where we are going and where our strategic focus lies, so I will bear the right hon. Gentleman's request closely in mind.
Julie Morgan: May I draw my right hon. Friend's attention to early-day motion 1292?
[That this House notes that the overwhelming majority of medical studies have shown that passive smoking is severely detrimental to human health; further notes that, according to a recent Imperial College London study, one person working in the hospitality industry is killed every week by the effects of passive smoking and that according to other studies, smoking is the cause of 32,000 deaths from lung cancer and 11,000 from other cancers every year; further notes that the Department of Health has initiated a major consultation exercise on smoking in public places that will form part of a White Paper later this year and that the Welsh Assembly is beginning a similar consultation; rejects the notion that a ban on smoking in public places would be illiberal and believes that a ban would act as an encouragement for heavy smokers to kick the habit; and calls upon Her Majesty's Government to introduce legislation to ban the smoking of tobacco in public places forthwith.]
It already has more than 100 signatures. Is he also aware of the private Member's Bill, which I am now promoting? It has passed through the other place, promoted by Baroness Finlay of Llandaff. What can my right hon. Friend do to ensure the safety of people working in the catering and hospitality industry, one of whom dies every week because of passive smoking? Can he arrange for us to have a debate on that important issue and does he agree that we should take the lead in that crucial area of public health?
Mr. Hain: I agree that we should take a lead in that crucial area of public health and, indeed, we are doing so. My right hon. Friend the Secretary of State for Health has launched a major consultation, which includes questions about what action could be taken to tackle smoking, and second-hand smoking in particular.
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That has been extended to the end of the month and one of the options is the introduction of legislation to ban smoking in public places. My hon. Friend has been a champion of that policy and I pay tribute to her. The Second Reading of her Bill will take place on 15 October.
Mr. Eric Forth: The hon. Member for North Cornwall (Mr. Tyler) called for the regulation of opinion polls, but will the Leader of the House consider regulating Liberal party election literature, which is even more dishonest than some of the opinion polls mentioned? Can the Leader of the House assist us by rehearsing again the timetable for the regional assemblies legislation? If we are to get the draft Bill only just before the summer recess and if it will be subject to pre-legislative scrutiny, the voters will not know what the draft Bill—never mind the final Bill—will be like, before they are asked to vote in the referendums. Is not that the wrong way round and will he therefore look again at the timetable? Will he give an undertaking that people will not be asked to vote on regional assemblies until they know the final form of the legislation?
Mr. Hain: In a moment of unanimity with the right hon. Gentleman, I agree that regulating Liberal Democrat literature would be in the interests of humanity, not to mention democracy and honesty in politics. I will look carefully at any opportunities to do so.
On the issue of the regional assemblies Bill, I go back to the precedents. I was involved in the referendum held in September 1997 on whether to set up a Welsh Assembly. It was preceded by a White Paper, called "A Voice for Wales". The public knew that they were voting on whether to set up a Welsh Assembly. Not even a draft Bill was published before the referendum, let alone one subject to pre-legislative scrutiny. We have moved on since then. We have had a White Paper and the voters in the north-west, the north-east, Yorkshire and Humberside will know that they are voting on whether to have a regional assembly to give them a voice and real power over regional issues. The Labour party is in favour of empowering the regions of England and providing them with better democracy. The fact that we will publish a draft Bill before the summer recess, which will then enter the pre-legislative process, will mean that extra information will be available, and the right hon. Gentleman should welcome that. We are not failing to make details available of what will be a short Bill: voters will have more information than the Scots and the Welsh did when they voted in September 1997.
Llew Smith: The Leader of the House will be aware that the public were informed by many of the world's politicians that we needed to go to war with Iraq because it had weapons of mass destruction, it was an immediate threat to the world and Saddam Hussein was behind the tragedy of 9/11. Now we know that none of those statements was true, may we have a debate to examine the evidence behind them? At the same time, perhaps we could discuss the real reasons for going to war, which were oil and the west's need to control the Gulf region.
Mr. Hain: My hon. Friend and I have an honest disagreement on that matter. I respect the honesty of his point of view and ask him to respect the honesty of mine, that of the Prime Minister and of the Cabinet, who took the decision—with the overwhelming backing of the House of Commons in a vote—to go to war. On the question of weapons of mass destruction, we await the report of the Butler inquiry and the later report from the Iraq survey group. They will pose all sorts of questions, and it will be open to my hon. Friend to look at those.
I disagree with my hon. Friend fundamentally on one point. The Government never ever said that Saddam Hussein was responsible for 9/11. We never made that assertion and nobody should be allowed to suggest that we did.
Mr. Roy Beggs: There was uproar and outrage recently at Belfast Crown court about the sentencing of Conor Doyle, who brutally murdered his girlfriend, Angela Snoddy, by stabbing her more than 70 times, almost severing her head. Could we have a debate on sentencing for serious crimes? Conor Doyle was sentenced to serve only 10 years before being considered for release. The House should have the opportunity to discuss sentencing levels, so that magistrates and the judiciary are aware of the concerns of right hon. and hon. Members and their constituents that, in far too many cases, sentences do not fit the crime. Life appears to be cheap, especially for women, and we need an opportunity to urge the Attorney-General to review all low sentences automatically.
Mr. Hain: As the hon. Gentleman knows, my right hon. Friend the Home Secretary has been anxious to ensure that life genuinely means life for the most serious murders and other crimes. He has introduced changes in the tariff arrangements and the sentencing procedures to ensure that the seriousness of crimes is taken into account by the courts. I agree that the case he mentions is appalling, and my right hon. Friend is taking a close interest in it.
Chris Bryant: May we have a debate on the lessons to be learned from last week's elections?
Mr. Forth: Twenty-two per cent
Chris Bryant: I am glad that the right hon. Gentleman said that, because 22 of the 25 seats in the Rhondda were held by Labour—I do not know What the problem was elsewhere.
May we look especially into the fact that many ordinary people who sought postal ballots were troubled that someone had to Witness their voting? They would like to see a change in that system. Furthermore, could the local and European elections always be held on the same day in future, as that seems to be rather good for turnout?
Mr. Hain: I certainly agree with the points that my hon. Friend made. The result in the Rhondda was an example to us all, not least in Neath. There was a complete wipe-out of Plaid Cymru, which paid the price for the dreadful council it had run and the policies for which it had been responsible. I agree with his point about the witness procedure, which was included, I
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think, at the insistence of the Liberal Democrats and the Conservatives, who wanted to make as much mess as they could of the postal voting system—they wanted to discredit it from the beginning. The witness statement made many voters feel that the privacy of their vote was in some way transgressed and I think that the Electoral Commission will want to look at that issue.
There is great merit in my hon. Friend's last point; when there are European elections, local elections should be held on the same day, so that people can vote just once. As we saw, turnout was up significantly. The results, if not brilliant for the Labour party, were brilliant for democracy.
Mr. Patrick McLoughlin: Can the Leader of the House find time next week for a statement to explain the logic behind why there will be referendums for regional assemblies before the House passes legislation, yet the Prime Minister is insistent that the House comes to its deliberations on the European constitution before the people will get a choice?
Mr. Hain: The situation is simple and I shall explain it to the hon. Gentleman. There are important precedents. When establishing a new body, such as assemblies for the three English regions, there is a vote on the principle, followed by the legislation to effect it. If the vote is no, the legislation is not proceeded with. That is exactly what we did in the case of Scotland and Wales and it makes sense, because an assembly is a new body—an entirely new institution.
What is at stake in the European constitutional treaty, however, is the amendment, reform and modernisation of several existing European treaties. There is a European Union; we are in it. We made that decision in a referendum under a Labour Government—denied by a Conservative Government—in 1975. As the legislation goes through, all the issues will be exposed, as will a lot of the Tory myths and downright lies about what the new constitutional treaty is about. The voters will come to see that it is a common-sense reform and modernisation, and the simplification of a tangled web of treaties into one text, so that everybody can see how the EU is structured and how it works. They will know, too, that the House of Commons for the very first time will be given a say on any new piece of European legislation. That is a big advance for democratic rights and for national sovereignty, and the hon. Gentleman should recognise it.
Mr. Gordon Prentice: May I return to the point that was raised by the right hon. Member for Bromley and Chislehurst (Mr. Forth)? It is important that we have an early statement from the Deputy Prime Minister on the timetable for the regional assembly referendums—when the orders will be made and so on. Does the Leader of the House think it right that we go ahead with all-postal voting in the regional assembly referendums in October when the Electoral Commission

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will not publish its review of all-postal voting on 10 June until the previous month—September? The whole thing has concertinaed and we need to rethink the timetable.
Mr. Hain: If I may say so, I think my hon. Friend has bought a lot of the Tory and media myths.
Mr. Prentice: No, no.
Mr. Hain: I am sorry to have to say that to my hon. Friend but I am afraid it is true.
The timetable is clear. We are currently assessing the evidence about what happened last Thursday and in the preceding week or two, because votes were cast before Thursday in large, if not overwhelming, measure. The Government will also seek the advice of the Electoral Commission and there will be plenty of time to take that into account for the postal ballots. There is a difference in that situation, however: people will be asked to vote yes or no to a regional assembly. We hope they vote yes, but that situation is different from the two sets of elections with what many people found were rather complicated ballot papers.
Angus Robertson: The Leader of the House may be aware of the ongoing discussions since July last year between the United States Administration and the United Kingdom Government about the renewal of a bilateral agreement on weapons of mass destruction programmes for both the US and the UK. May I commend a new report by the British American Security Information Council? Its conclusion states:
"The Labour Government has declined to set aside time for a full parliamentary debate and it has been parsimonious with the actualite of the agreement."
Does the Leader of the House agree that US-UK nuclear weapons collaboration under the mutual defence agreement is important and that it should be debated in full?
Mr. Hain: It has been going on for a very long time—many decades—so I do not see a case for an urgent debate, but the hon. Gentleman can apply for a debate in the normal way.
David Taylor: Public-private partnerships and private finance initiatives, equally unattractive cousins, have racked up aggregated debts of £120 billion, which is more than 10 per cent. of gross domestic product and is off the Government balance sheet. Perhaps the largest such deal is the one to modernise and upgrade the tube network, whose present net value is £16 billion over the next 30 years and which provides returns to shareholders at the mouth-watering levels of 18 to 20 per cent. Has the Leader of the House seen the report published today by Sir John Bourn, the Comptroller and Auditor General. Stripped of the accounting jargon with which I am relatively familiar, that report is excoriating in its criticism. It says, in effect, that the deal is prohibitive in cost, flawed in concept and intolerable in consequence to the taxpayers, travellers and train drivers of this land. When can we have a debate on the shambles and folly that is PFI?
Mr. Hain: There are many opportunities to debate those matters. The Government will obviously want to study the report carefully and the Secretary of State for Transport will want to note my hon. Friend's points, but he must acknowledge that through the PFI and the PPPs there has been a huge expansion in capital programmes under the Labour Government—
David Taylor: At a cost.
Mr. Hain: Of course. But the cost through public borrowing and public funding would have meant fewer opportunities to provide from public finance the many capital and public spending projects in which we have invested on a record basis.
Sir Sydney Chapman: May I return the Leader of the House to the issue raised by my right hon. Friend the Member for Bracknell (Mr. Mackay)? The right hon. Gentleman will be aware that four weeks ago I asked for a debate on Iraq, especially in the light of the handover to the Interim Government on 30 June. As that date is only 13 days away and as he has already announced the business for the next fortnight, may I earnestly implore him seriously to consider holding a debate, certainly in the three weeks thereafter before we go down for the summer recess?
Mr. Hain: I will pay very serious attention to the hon. Gentleman's request I am sympathetic to it, but it is a question of fitting it into the rest of the business—the need to get Royal Assent for Bills and so forth. However, the time is fast approaching when we should take stock of where we are going on Iraq and his point will be well noted.
Mr. Harry Barnes: As a Bill to implement a version of the Tobin tax has been accepted by the commission on finance and budgets in Belgium and is due to be voted on by its Parliament in a fortnight's time, can we have a debate on the sensible proposals that the Belgians are currently examining? Those proposals involve a low, normal tax on currency speculation, but when matters get out of hand and the currency is being battered about by massive speculation, there should be a high rate of tax to interfere with that and dampen it down, because many of the world's economies in poorer nations are destroyed by currency speculation.
Mr. Hain: I acknowledge that my hon. Friend has long been an advocate of the Tobin tax. The Chancellor and the previous Secretary of State for International Development, who addressed these matters some years ago, have explained the Government's point of view, but I am sure that the Treasury will want to note the points that my hon. Friend makes.
Dr. Julian Lewis: I was tempted to ask for a debate on just how badly a Labour Government have to lose a European election before they will realise that they should not sign up to a European constitution, but as I know that I would not get that, may I ask instead for a statement or debate on the law of trespass? I was involved in a case whereby a burglary took place and the police identified the fact

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that people had been present but were not able to charge them because their alibi was that they had gone into the house with the intention of occupying it and setting up a squat. Is there not something extremely strange about a situation where if people steal and take away another's property, they commit a criminal offence, but when they enter another's property, change the locks and sit there, they cannot be touched by the police and the owner has to go to enormous expense and trouble to reoccupy his or her own property?
Mr. Hain: That is a rather strange situation, I must concede. I am sure that Ministers in the Department for Constitutional Affairs, one of whom is sitting to my left, will have noted very carefully what the hon. Gentleman has said.
On the Europeans elections, the blunt truth is that everyone lost them: the Conservatives lost them, Labour lost them, the Liberal Democrats lost them and the United Kingdom Independence party lost them, as did every other minor party. That is the picture that resulted from last Thursday's vote.

Point of Order
1.22 pm
Mr. George Osborne: On a point of order, Mr. Speaker. It is a point of order that relates to Treasury questions, which we have just had, and the answer that the Financial Secretary gave to Question 10, on Equitable Life, which was asked by my right hon. Friend the Member for Bracknell (Mr. Mackay). The Financial Secretary used her answer to make a major announcement about the future of the savings industry and to launch a Government consultation document, which is now available in the Library. Is it right that the Government can use a very narrowly worded question on Equitable Life to make an announcement about what is really a very different area of Treasury business, and to do so in such a way that gives the House very little opportunity—indeed, no opportunity whatsoever—to question the Government? When the Government first made such an announcement, they did so by oral statement. There was a statement on Sandler products at the time. Is it right for the House that that announcement has been slipped out in response to an oral question on another issue?
Mr. Speaker: Of course, I am not responsible for the replies from Ministers. The hon. Gentleman will have noticed that those on both Front Benches get some elbow room from the Speaker, so it cuts both ways. My understanding was that the Minister was drawing attention to a written statement that was put on the Order Paper today. Therefore, I gave the hon. Lady some elbow room. I would not expect that to happen all the time, but it did today, so we will leave it at that.

BILL PRESENTED
  MENTAL CAPACITY
  Mr. David Lammy, supported by the Prime Minister, Mr. Secretary Prescott, Mr. Chancellor of the Exchequer, Mr. Secretary Blunkett, Mr. Secretary Reid, Ms Rosie Winterton and Mr. Christopher Leslie, presented a Bill to make new provision relating to persons who lack capacity; to establish a superior court of record called the Court of Protection in place of the office of the Supreme Court called by that name; to make provision in connection with the Convention on the International Protection of Adults signed at The Hague on 13th January 2000; and for connected purposes: And the same was read the First time; and ordered to be read a Second time tomorrow, and to be printed. Explanatory notes to be printed. [Bill 120].
Orders of the Day

  Public Audit (Wales) Bill [Lords]
  [Relevant documents: The Fifth Report from the Welsh Affairs Committee, Session 2002–03, on the draft Public Audit (Wales) Bill, HC 763, and the Government's response thereto, HC 87, Session 2003–04.]
  Order for Second Reading read.
  1.24 pm
  The Parliamentary Under-Secretary of State for Wales (Mr. Don Touhig): I beg to move, That the Bill be now read a Second time.
  The Public Audit (Wales) Bill is intended to create a unitary public audit framework for Wales, with overall responsibility for public audit vested in one person—the Auditor General for Wales. The Bill will extend the Auditor General's powers to include most, although not all, of the current functions of the Audit Commission in Wales. Together, the Auditor General and his staff will be known as the Wales Audit Office or Swyddfa Archwilio Cymru. It builds on the creation, under the Government of Wales Act 1998, of the Office of the Auditor General for Wales and the National Assembly's Audit Committee to scrutinise the National Assembly's expenditure and the value for money obtained from it.
  Llew Smith: The Minister says that the new audit office will have the ability to scrutinise the funding of the National Assembly for Wales. Will it be able to look, for example, into the commitment made at the time of the referendum? We were told, as he well knows, that if we voted for the National Assembly, we would have a bonfire of the quangos. We were promised not only such a bonfire, but that the savings that would come from it—we were told that they would be £20 million—would be more than enough to run the National Assembly for Wales. We now know that the National Assembly costs an additional £100 million or so a year to run, so would it be possible for the new audit office to consider the original claim and, indeed, the funding since then of that institution?
  Mr. Touhig: Of course, it will be a matter for the Auditor General to decide what he and his staff will examine. As for the point that my hon. Friend makes about a bonfire of the quangos, I am not sure whether there has been one, but there have certainly been a few sparks.
  Devolution has resulted in a far greater degree of scrutiny and accountability in respect of public spending in Wales, and the Bill will advance that cause further. Under the Bill, the Auditor General will retain responsibility for financial and value-for-money auditing of the Assembly, its bodies and its funds. The Bill will extend the Auditor General's remit, so that he or she will have sole responsibility for the financial audit and value-for-money studies of NHS bodies in Wales. He or she will appoint auditors to local government
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  bodies in Wales and take on inspection functions under the Wales programme for improvement, best value review under the Local Government Act 1999.
  Mr. Greg Knight: Does the Minister not think that there is a case for the Public Accounts Committee also to have the power to scrutinise the Welsh Assembly's spending decisions?
  Mr. Touhig: Of course, the Public Accounts Committee can broadly examine such matters because the House votes the budget for the Welsh Assembly to the Secretary of State for Wales, who then hands it to the Welsh Assembly. That is a matter for the PAC, but the right hon. Gentleman will accept that the Assembly has its own very effective Audit Committee.
  Mr. Alan Williams: In fact, the Public Accounts Committee, as my hon. Friend knows, only investigates reports from the National Audit Office, under Sir John Bourn, in so far as they affect England. Sir John Bourn, with a different hat on, reports directly to Wales. So we in the PAC have no locus to hear matters that relate specifically to Wales.
  Mr. Touhig: I am grateful to my right hon. Friend for making that point clear to the House.
  Llew Smith: In referring to the commitment to have a bonfire of the quangos, the Minister admitted that there had been not a bonfire, but a few sparks. Will he accept that we have not had even a few sparks, only a damp squib? There are now more quangos in Wales than when the commitment way made. Indeed, quangos in Wales are far more powerful now than they were then.
  Mr. Touhig: I think that I will stick by my original comments and say that there have been a few sparks.
  Hon. Members will be aware that the Bill has been the subject of pre-legislative scrutiny and public consultation. It was introduced in another place last November and closely examined there, and the process has undoubtedly improved it. I especially pay tribute to representatives of the Conservative party and the Liberal Democrats because their contributions to the process and the discussions that I had with them helped to inform our judgments on how to amend and improve the Bill. That represents Parliament working at its best.
  The Bill's objectives have been almost universally welcomed by all who took part in the early scrutiny. The Assembly in Cardiff, the Auditor General for Wales, the Audit Commission in Wales and the Welsh Local Government Association have welcomed it. The Welsh Local Government Association is satisfied that the Bill's proposals will not impinge on its constitutional independence and democratic accountability. Indeed, several of the Bill's provisions are designed to safeguard the independence of local government. Foremost among them is this safeguard: although the Auditor General will take on responsibility for the appointment of auditors to local government bodies, he or she will not be able to appoint him or herself in a personal capacity to be that auditor.
  Mr. Ian Liddell-Grainger: Clause 5 will insert new section 145C "Studies relating to registered social landlords" into the Government of Wales Act 1998. Will the Auditor General be able to appoint auditors to examine social landlords in isolation? I ask because the new section contains nine subsections, but does not make it clear where the responsibility for such appointments lies.
  Mr. Touhig: Yes, the Auditor General will be able to do that, which will be welcomed as beneficial.
  Key benefits will flow from the Bill. It will result in a single audit body where there are now two, which will enable expertise and best practice from differing areas of audit work to be developed and shared more easily. It will make public audit arrangements in Wales simpler and more understandable. For example, two different bodies currently have responsibility for various aspects of the financial audit of the health service and both have responsibility for value-for-money studies. I think that everyone would agree that that is confusing and over-complex. Under the Bill, the Auditor General will have sole responsibility for the financial and value-for-money audit of NHS bodies in Wales. The Bill also tries to encourage collaboration and mutual assistance between the Auditor General and a wide range of relevant bodies, such as Audit Scotland and the Comptroller and Auditor General for Northern Ireland.
  We have tried to find the most logical and cost-effective approach on cross-border work between England and Wales. I can confirm that the Audit Commission will retain its existing functions under the Audit Commission Act 1998 to undertake local government cross-border reviews and other studies on an England and Wales basis. Similarly, the Health and Social Care (Community Health and Standards) Act 2003 empowers the newly created Commission for Healthcare Audit and Inspection to undertake equivalent cross-border reviews in respect of NHS bodies.
  Gareth Thomas: Does my hon. Friend agree that cross-border comparisons are absolutely essential if we are to guarantee that there is a broad-ranging approach on ensuring that we have value for money between England and Wales?
  Mr. Touhig: I do, because I remember from my previous incarnation as a councillor in Gwent in south-east Wales that cross-border comparisons help to drive up standards. We learned a great deal from such studies.
  The Bill will facilitate cross-border working by agreement and the Government are confident that co-operation will be widely embraced. It includes provisions that require the Auditor General, the Audit Commission, the Assembly and CHAI to co-operate and consult each other when necessary for the proper exercise of their respective functions. The hon. Member for Leominster (Mr. Wiggin) will recall from our debates on the Wales (Health) Bill that several Conservatives Members were especially keen to ensure that there were would be no duplication of effort through cross-border co-operation. The Bill requires the Audit Commission and CHAI to have regard to work done by the Auditor General when undertaking cross-border work.
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  The Government amended the Bill in another place to impose mutual duties on certain key bodies to provide each other with any information that they may reasonably require for cross-border comparative purposes. Those bodies are the Auditor General and the Audit Commission, and the Auditor General and CHAI. All the essentials are in place for effective and productive cross-border collaboration without imposing over-rigid requirements.
  Since the draft Bill was first published in April 2003, it has been scrutinised by the Select Committee on Welsh Affairs, the report and recommendations of which were debated by the Welsh Grand Committee in July 2003. A Committee of the Assembly also scrutinised the draft Bill in the early summer of 2003 and the full Assembly debated its report. More than 200 organisations were involved in a 12-week public consultation, and 41 recommendations for change or clarification were made in all, of which 19 were accepted. In addition, improvements were made to the Bill as a result of amendments made during its passage through another place. I have already mentioned the amendments made on the mutual duty of the key audit and inspection bodies to provide each other with information for cross-border comparative studies, and I also want to touch on other key improvements to the Bill.
  The draft Bill was designed to give the Auditor General enhanced rights of access to documents and information on bodies for which he has statutory audit responsibility, and those enhanced rights reflected the recommendations of Lord Sharman's report. Clauses 11, 18 and 52 of the Bill will ensure that auditors should be able to follow the trail of public money to end users. My hon. Friend the Member for Blaenau Gwent (Llew Smith) will remember when we were involved in pressing for an inquiry on a college in our part of the world, so I am sure that we will all welcome the improvement to the system.
  The Welsh Affairs Committee recommended that the Bill should provide consistent access rights across both local government and non-local government sectors in Wales, and the draft Bill was amended to achieve that. However, the Bill now goes one step further. It has been amended to enable the Auditor General and appointed auditors of local government bodies to require assistance and information from effectively any person whom they consider could help in exercising these functions, irrespective of whether that person held or was responsible for relevant documents. That means that a person will no longer be able to refuse to give an auditor assistance solely on the basis that he or she had lost a document or was no longer in possession of it.
  Hon. Members will be well aware that the most contentious of the Bill's provisions is clause 54. It will restrict the disclosure of information obtained during the course of a local government audit or study by an auditor or the Auditor General, albeit with widely cast exceptions. The clause is equivalent to section 49 of the Audit Commission Act 1998. Both pieces of legislation impose a criminal sanction on a person who discloses information in contravention of those provisions. Both the Welsh Affairs Committee and the Welsh Assembly recommended that the clause should be deleted from the draft Bill, as did the Auditor General. However, the

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  Audit Commission and the Welsh Local Government Association argued for it to be retained because it would provide a safeguard against the inappropriate or premature release of information—I stress the importance of the word "premature".
  The Government fully understand that there should be no impediment to the legitimate disclosure of information, and the Freedom of Information Act 2000 is a testament to that. In this particular case, however, they also consider that there should not be undue inconsistency in the criminal law between England and Wales on the appropriate release of information. That would be the case if clause 54 were deleted while section 49 of the Audit Commission Act 1998 remained in force.
  Owing to those concerns, the Government amended clause 54 in another place to enable the Bill to be further amended after its enactment to reflect the outcome of a general review that is being undertaken by the Department for Constitutional Affairs under the Freedom of Information Act on existing statutory bars to the disclosure of information. The Government have announced their intention to amend section 49 of the Audit Commission Act as a result of the review, and I made a ministerial statement to that effect, which was laid before both Houses of Parliament on 24 March. The amendment will overturn the existing presumption in section 49 against disclosure, and change it to one in favour of disclosure, which is wholly consistent with the spirit of the Freedom of Information Act 2000.
  Lembit Öpik: While welcoming the change and the fact that the Government have listened to people's concerns, I should be grateful if the Minister would outline the time scale. Lord Evans said in another place that he expected change to be completed
  "as soon as possible and certainly before the end of this year."—[Official Report, House of Lords, 11 May 2004; Vol. 661, c. 168.]
  Will the Minister assure us that the matter will be entirely resolved by the end of the year?
  Mr. Touhig: I am grateful to the hon. Gentleman, and was about to come on to that point. It is the Government's intention to make an order before the end of the year to amend section 49. We have to amend clause 54 separately, and that amendment will be made by the end of the year to bring it into line with section 49.
  Mr. Liddell-Grainger: Clause 54(2)(h) talks about the disclosure of information
  "for the purposes of any criminal proceedings which have been or may be initiated".
  If such information is disclosed retrospectively, who would be responsible? Would it be the Audit Commission in Wales or the Audit Commission? If there is a UK-wide investigation before the Bill is enacted which body would be responsible?
  Mr. Touhig: I believe that it would be the Audit Commission, although it may be the Auditor General for Wales. I will clarify the position for the hon. Gentleman before the winding-up speeches
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  Clause 22 deals with immediate and other reports in the public interest. Subsection (1) states:
  "In auditing accounts of a body under this Chapter, an auditor must consider whether in the public interest, he should make a report on any matter which comes to his notice in the course of the audit, in order for it to be … considered by the body, or … brought to the attention of the public."
  Subsection (3) makes the position clear. It states:
  "If the auditor considers that the public interest requires the matter to be made the subject of an immediate report, he must make the report immediately."
  I hope that that assuages the concerns of right hon. and hon. Members. The Government are determined that there should be no unreasonable impediments to the proper disclosure of information in the Bill.
  Mr. Liddell-Grainger: Are subsections (1) and (3) of clause 22 covered by the Human Rights Act 1998? If one asked for retrospective information about an audit, disclosure of such information in the public interest could breach someone's human rights.
  Mr. Touhig: I do not believe that that would be the case but, again, I will provide clarification later for the hon. Gentleman on that important point. We are establishing a series of measures so that there is a presumption in favour of disclosure, and I believe that Members on both sides of the House will welcome that.
  The role of the public expenditure watchdog is vital in maintaining and improving accountability and safeguarding the public interest. Almost £12 billion of taxpayers' money is spent on functions devolved to the National Assembly which ensures that it is spent correctly and with due regard to value for money in public services. Although financial audit remains a key component of an auditor's work, the role of auditing has developed over recent years. It increasingly includes advice and assessment of clients' corporate governance arrangements, including the assessment of risk management. Advice on increasingly sophisticated financial management systems is another important aspect of auditing. Inside an organisation, people would say that the watchdog is a man's best friend. A value-for-money audit provides reassurance to the public, and is strategically important for developing policy and improving performance.
  The mechanisms for public expenditure and accountability are becoming more complex. The Assembly is working with the Government to develop a distinctive partnership approach, which involves a range of public, voluntary and private sector bodies in the development of policy and the delivery of objectives. Good examples include the communities first initiative and the Wales waste strategy, but all the initiatives involve close collaboration and co-operation across sectors. The value-for-money functions of the Auditor General for Wales are retrospective, and cover the way in which a body has used its resources in the past. The Bill will enable him to undertake forward-looking value-for-money studies across the sectors, covering the full range of public bodies in Wales. Those studies can inform policy decisions and will provide reassurance to taxpayers that their money is being well spent.
  In conclusion, the Bill offers a single framework for public audit in Wales, with expertise vested in a single organisation, which suits both the way in which the

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  Government work in Wales and the interests of the people of Wales, who pay for the services that they receive from the public sector. It will concentrate expertise and help to develop and spread innovation and best audit practice across the public sector in Wales. It will also enable the Wales Audit Office to play a full part in developing wider audit standards in co-operation with other bodies throughout the United Kingdom. It provides the basis for a world-class audit body of which Wales can be proud, and gives the Auditor General the tools that he needs to meet the challenges of rapid change and an increasingly complex public finance framework. I commend the Bill to the House.
  1.46 pm
  Mr. Bill Wiggin (Leominster) (Con): I am grateful to the Minister for his kind words, and to the hon. Member for Clwyd, South (Mr. Jones), the Chairman of the Welsh Affairs Committee, under whom I served when the Bill was scrutinised. I pay tribute to the Committee's hard work, and particularly to him.
  Regrettably, the programme motion proposes a deadline of 1 July for Committee proceedings. Such a timetable will create difficulties, given the complexities of clause 54 that the Minister has just told us about. The Bill will consolidate audit arrangements for public bodies in Wales, replacing the Auditor General in Wales and the Audit Commission in Wales with a national audit office that will ensure best value from the National Assembly, health bodies, NHS trusts and local government bodies. In principle, we welcome the consolidation of a single audit regime in Wales, which makes good sense. The new office has great potential to improve the quality of public services and government in Wales, and ensure the best-value use of resources. We owe a debt of gratitude to Baroness Noakes and Lord Roberts of Conwy, who greatly improved the Bill in the other place. Most of the 23 Government amendments made in the House of Lords were introduced after discussion of Conservative amendments, so I am grateful to my colleagues in another place.
  There are, however, still inconsistencies in the Bill about which we are concerned. The Government have insisted on making the Bill consistent with audit arrangements in England simply by regurgitating arrangements that currently exist in England and Wales. Consequently, a great opportunity for improving the audit regime in Wales has been missed. Clauses 5 and 11 are consistent with provisions in England, but create arrangements that are inconsistent in Wales.
  We are concerned that the criminal sanctions in clause 5 will affect registered social landlords' rights of access, as the clause makes it a criminal offence for registered social landlords to hinder the work of the Auditor General for Wales. However, criminal sanctions are omitted from clause 11, which deals with the Auditor General's right of access to general information. We will therefore make the Bill consistent by tabling amendments that either remove the criminal sanctions from clause 5 or create criminal penalties for a breach of access rights in clause 11. Clauses 18, 53 and 5 do not deal with criminal sanctions, but are inconsistent with one another, so we will table amendments to deal with that.
  In an attempt to justify those inconsistencies, the Minister said that the Bill is consistent with audit provisions in England. The Government have ignored
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  the chance to create a coherent, logical audit regime in Wales, and one such inconsistency is to be found in clause 14. The Auditor General cannot appoint himself as the auditor to local authorities, yet he can audit NHS bodies himself. As Baroness Noakes pointed out, why would such an appointment cause a conflict of interest in local government bodies but not health trusts? It is puzzling that there should be constraints on the Auditor General in the local government sphere while he has freedom to act directly in the health field.
  The most contentious issue is clause 54, which restricts the disclosure of information held by the Auditor General in respect of local government unless consent is given for its disclosure by the body or the person to whom the information relates.
  Mr. Liddell-Grainger: My hon. Friend is making a powerful case. Does he agree that if the Auditor General found an anomaly in relation an NHS trust or social housing, the Audit Commission would have to audit the Auditor General to check that his figures were right, so that in the Audit Commission role he could take action on the Auditor?
  Mr. Wiggin: I am grateful to my hon. Friend for that intervention. He makes an important point and I look forward to hearing his contribution in Committee, which I am sure will be valuable. The difficulty with this part of the Bill is that the Auditor General is not allowed to appoint himself. If he is allowed to appoint himself to audit NHS trusts, surely he should be able to appoint himself to audit local government expenditure. My hon. Friend sensibly points out that we need consistency; otherwise the purpose of the Bill is diminished. The Bill is a good one, by and large, and it will improve matters, but not as much as I would have liked.
  Mr. Andrew Robathan: While my hon. Friend is on inconsistency and disclosure of information, can he say whether, in his judgment, the failure to disclose information could be in conflict with the Freedom of Information Act 2000, about which we heard from the Minister?
  Mr. Wiggin: I shall have more to say about clause 54, but there is indeed a problem. The Government Whip seemed surprised by my opening comments about the timetabling, and I shall try to explain why I am bothered. The Government's amendments to clause 54 through amendment of section 49 of the Audit Commission Act 1998, under the Freedom of Information Act 2000, will not take place until after the Bill is on the statute book. We are therefore being asked to legislate on trust. Surely it is the job of Parliament to ensure that we legislate as well as we can, rather than by remote control or trust in the Government. That is why the Committee stage should take place after the Government have tabled their amendments to the other legislation.
  Lembit Öpik: Although I understand the hon. Gentleman's suspicion about taking the Minister's assurance on trust, does he accept that given the explicit

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  statements made in another place and by the Minister today committing the Government to introducing the appropriate amendments before the end of 2004, the Government are unlikely to have much room for manoeuvre or delay?
  Mr. Wiggin: I am tempted to remind the hon. Gentleman that the Secretary of State just told us that everybody lost the European elections. When one came first in those elections, it is difficult to believe the Government all the time.
  Mr. Robathan: I do not wish in any way to impugn the Minister, who is a decent soul, but until about two months ago we were told categorically that there would not be a referendum on a European Union constitution. Now we are told that there will be a referendum. Does that not reinforce my hon. Friend's point that we should not take assurances on trust?
  Mr. Wiggin: I agree. The problem in the present case is that there is no option. We shall deal with that in Committee. The Bill is a good piece of legislation and the Government are trying to do their best, but the problem—I address this to the hon. Member for Montgomeryshire (Lembit Öpik) as well—is that even though the Government have promised to make changes, we still have not seen a draft or detail of those changes.
  Mr. Alan Williams: The House will have the opportunity to discuss the Government amendments when they are tabled, and that is when we will make the decision. Since we are giving a subordinate power, which could not be used to introduce changes in Wales as it is contingent on what happens in England, the Bill is utterly logical.
  Mr. Wiggin: I do not agree. The right hon. Gentleman implies that whatever is later debated will be perfectly adequate for Wales. That is fundamentally at odds with the Select Committee report. Everyone who has criticised the clause is deeply unhappy about it. I do not agree with the right hon. Gentleman, but I accept that he is doing his best by intervening.
  If I can make some progress, perhaps I can shed some light on why I am concerned about clause 54. It restricts disclosure of information held by the Auditor General in respect of local government unless consent is given by the relevant body. The Government have conceded that the clause is not satisfactory, but their amendment does not go far enough to protect against those who mishandle their duties to public bodies. It blocks the proper presentation of findings in the public domain that would embarrass those involved.
  The Government amendment would allow but not require the Secretary of State to amend clause 54, but only if section 49 of the Audit Commission Act 1998 is amended under the Freedom of Information Act 2000. However, the Government have not proposed to change section 49, except in what we heard today, so I have reservations about the possible use of clause 54 against whistleblowers. Anyone who doubts that should consider what happened to James Cameron. I was extremely disturbed to read about that.
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  Those who support a free society will also have concerns about clause 54, as it would deter potential whistleblowers, who would be treated far more harshly in local government audit than in any other public sector audit environment. That is one of the inconsistencies that concern us. We believe it is wrong in principle to apply criminal sanctions to the disclosure of audit information. That was the conclusion of the Welsh Affairs Committee too, and of the Assembly Committee that considered the draft Bill. The Auditor General has made it clear that he did not request those provisions. It is the Government who wish to undermine the accountability and responsibility of public bodies for their actions.
  Under what circumstances do the Government consider that criminal sanctions would be appropriate for the disclosure of information? In his opening comments the Minister suggested that criminal sanctions would be appropriate if someone released information a little earlier than they should, but I do not believe that James Cameron would ever have found it too late to deliver the information that he did.
  Mr. Touhig: I shall try to be helpful. The Government take the view, as I said, that there should be no inconsistency in criminal justice between England and Wales. That is why we thought clause 54 should be retained. Following Discussions in the other place and with colleagues, we amended the clause in the other House, as the hon Gentleman understands. As a Member of Parliament in the 1992–97 Parliament, I introduced a Bill to protect whistleblowers. The hon. Member for Blaby (Mr. Robathan) was very helpful in the debate—we may have converted him in the course of it—and he made an important contribution to that debate. I may have been sitting on the Opposition Benches as he is now but that is the will of fate.
  Clause 54(2) lists a number of exceptions to the restriction on disclosing information. Those exceptions explicitly allow disclosure on matters relating to best value, fraud, the work of the ombudsman, the discharge of social service functions, education best-value matters, matters affecting social landlords and matters of a criminal nature. So on a raft of matters set out in subsection (2), disclosure is allowed as the clause stands.
  Mr. Wiggin: I am grateful to the Minister, and I am keen to emphasise that at no stage did I think that he was one of those on the darker side of this business who would suppress whistleblowers. Nevertheless, we must be careful. One can only imagine the fear and trepidation felt by someone before they blow the whistle.
  Mark Tami: If the hon. Gentleman does not consider criminal sanctions suitable, what sanctions would be suitable?
  Mr. Wiggin: If whistleblowers are to be allowed to tell the truth, criminal sanctions may not be the best way to deal with them. We are talking about people releasing information, not stealing or committing acts that are traditionally known as crimes. They could be fined or dealt with in other ways, but the clause allows imprisonment. Even fining may be too harsh. I am concerned not so much about the scale of the

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  punishment as about the whole principle of how we legislate and the manner in which the Government are promising to change the Bill after it is on the statute book. I hope that that answers the hon. Gentleman's question.
  On Third Reading in the other place, Lord Evans of Temple Guiting announced that the Office of the Deputy Prime Minister had instructed the Department for Constitutional Affairs to incorporate an amendment to section 49 of the Audit Commission Act and to amend clause 54 accordingly, although that will not happen until the end of this year. Clause 54 represents another example of the Bill following English precedent instead of taking the opportunity to create something new for Wales. As the Welsh Affairs Committee said, it is a shame that the Bill is not better for Wales instead of no worse than for England.
  As it stands, the Bill represents many wasted opportunities. I fear that the changes that it introduces have not been properly costed. The Government have admitted to an inaccurate estimate of start-up costs, with the most recent regulatory impact assessment raising the initial cost from £500,000 to £987,000. However, that does not account for additional budgetary costs, even though there will be no scale economies in establishing the Wales Audit Office. It would be helpful if the Minister informed the House of the current running costs, and I hope that he will do so when he winds up.
  Although the Bill will make a difference, it is rather disappointing that it is the only piece of Wales-specific legislation, despite the National Assembly for Wales having proposed five Bills. We know that Lord Morris of Aberavon was disappointed when, much to the Minister's embarrassment, he said on Second Reading in the other place:
  "I know the pressures on the government's business managers … and"
  I have
  "seen many Ministers' worthy legislative proposals thrown aside for lack of time. But that is the purpose of the Secretary of State for Wales—to fight for Wales in Cabinet; he has hardly any other real functions."
  He must have forgotten that the Secretary of State has another job, as of course we could not forget, as he answered questions this morning. He continued:
  "By any standards, this is pretty poor reward for his efforts."—[Official Report, House of Lords, 9 December 2003; Vol. 655, c. 717.]
  Overall, we welcome the Second Reading of the Bill, which will create a single audit body in Wales to the benefit of the people of Wales. The Bill has been greatly improved by the hard work of Conservatives, but inconsistencies and concerns remain. I do not wish at any stage to forget the input of the Welsh Affairs Committee.
  The challenge in Committee will be to amend clause 54 so that the Government can ensure that it satisfies modern tests of transparency. I know that they and the Minister want to deliver that result, but I am still not happy that they have completely succeeded.
  How can we possibly pass the Bill until section 49 of the Audit Commission Act has been amended? I cannot believe that the Government would want it any other
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  way, given that they propose to uphold the accountability of public bodies and to protect those who blow the whistle on corruption.
  We will strive in Committee to resolve the inconsistencies in the criminal sanction provisions with regard to rights of access to information. There is an underlying concern that the Bill simply imports the current audit regime for England and Wales, thereby ignoring the chance to make the audit regime in Wales sharper and more suitable than the English version. Instead of making Wales the beacon of good audit practice, the Government have chosen to duplicate the Audit Commission Act. That is short-sighted. We shall endeavour to improve the Bill further in Committee.
  2.3 pm
  Mr. Martyn Jones: Following last year's effective consultation and pre-legislative scrutiny of the Bill by the Select Committee on Welsh Affairs, of which I am Chairman, the Welsh Grand Committee and Committees of the Welsh Assembly, several changes have been made, and it has been improved still further during its passage through the Lords. I should like to single out the following matters for the House's attention.
  Julie Morgan: As my hon. Friend says, the Bill has received an enormous amount of scrutiny, during which the Welsh Affairs Committee and the Committee in the Assembly interviewed the same people. Next week those two Committees will start a joint investigation—an historic event. Does he agree that that is partly a result of our experience on this Bill?
  Mr. Jones: I am grateful to my hon. Friend. I was going to mention that later, but she has pre-empted me.
  The Welsh Affairs Committee welcomed the extension of the Auditor General for Wales's access rights to follow public money to end recipients such as contractors and grant recipients—that was in clause 11 at the time—and recommended that those extended rights should also apply to local government-appointed auditors. That was accepted, and what is now clause 18 was amended before the Bill was introduced. That is an example of how pre-legislative scrutiny is helpful. Following debate in the Lords, the Government extended those rights even further to require assistance from anyone who might have relevant information, as well as the production of documents. That is a good outcome. Public auditors in Wales will now have access rights among the best in the civilised world and fully in line with Lord Sharman's recommendations.
  The draft Bill allowed the Audit Commission to continue to have access rights to Welsh local authorities for the purposes of producing cross-border reports on performance. We should remember that the Auditor General for Wales was not being given similar access to English local authorities. The Welsh Affairs Committee recommended that the Auditor General for Wales and the Audit Commission should co-operate on cross-border work and produce reports that were jointly badged so that both organisations could take their share of the credit.
  Mr. Liddell-Grainger: The hon. Gentleman is making some interesting points. He hits the nail on the head in

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  relation to access to documents by the Auditor General, which is covered by clause 11(3), but how does he see that unfolding in relation to, for example, cross-border investigations of subsidiary companies? There are cost implications, legal implications and, perhaps, European implications, but none of that is dealt with in the Bill.
  Mr. Jones: I agree that, on the face of it, that is not in the Bill. However, the Government's proposals go some way towards meeting the concerns expressed in the Welsh Affairs Committee as regards such situations.
  The Government did not accept the Committee's view, but they amended the Bill to require the Audit Commission to take account of the work of the Auditor General for Wales and to co-operate with him—or her, as may be the case in future. Following pressure in the House of Lords, the Government tabled new clauses requiring the Audit Commission, the Auditor General for Wales and the Commission for Healthcare Audit and Inspection to share relevant information. Although we are not entirely happy with that, it is a good halfway-house solution. I hope that the Government will consider that further.
  Clause 54—formerly clause 50—prevents information obtained in the course of an audit from being disclosed except in certain circumstances. Our Committee backed suggestions that it should be deleted and replaced with agreed protocols about the clearance of draft reports. The Government did not accept that because they believed the clause to be identical to section 49 of the Audit Commission Act 1998, which will continue to apply in England. As that section contains offence provisions, the Government took the view, as the Minister confirmed again today, that it would be unacceptable to have aspects of criminal law that applied in England but not in Wales.
  Following pressure by the Lords, the Government issued a ministerial statement saying that section 49 was under review as part of the review of statutory bars following the passing of the Freedom of Information Act 2000. They further stated that it is likely to be amended to create a presumption in favour of disclosure rather than against it, as at present. Clause 54 now contains an order-making power to allow the Secretary of State to amend it in line with any changes made to section 49 of the 1998 Act. I understand that, as the Minister repeated today, that will happen within the year. However, I still believe, as do my Committee, that Wales is being required to hang on to England's coat tails. That is a cause for concern.
  More generally, part 2, which covers local government audit, replicates the Audit Commission Act 1998 in large measure, with the Auditor General for Wales being put into the commission's shoes. The Bill has its origin in a local government Act of the 1970s, the name of which escapes me, and could do with being brought into the 21st century. However, the Government do not wish to create different rules for local government in England and in Wales—that is a reasonable proposition—especially as such bodies are accountable to their electorates, not the Welsh Assembly.
  Part 2 also contains offence provisions unlike the audit arrangements for the Assembly and its related public bodies. That contrasts with the audit of NHS
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  bodies, which are accountable to the Assembly, and part 3 greatly simplifies the audit regime to suit Welsh circumstances.
  Overall, the Bill is a good measure, which will create a Wales Audit Office. That is appropriate for the devolved environment in which we now have to work in Wales.
  2.10 pm
  Lembit Öpik: Good auditing tends to be invisible in that, when it is done correctly, the general public get the benefit but do not necessarily observe the process. In my time as a Member of Parliament, not one member of the public has lobbied me for the Bill. I can see that the Minister is barely able to contain his shock at that discovery but it is true. Nevertheless, a responsible Parliament must take the matter seriously.
  The complex and sophisticated nature of modern auditing means that it is in order for us to try to ensure that we have a strategic and consistent approach across Wales. I therefore join others who give the Government credit for the extensive scrutiny that has taken place in the run-up to the debate. As we have heard, the Welsh Grand Committee debated the Bill last July, the National Assembly for Wales considered it in August, and the Select Committee on Welsh Affairs produced a report—we have just heard some of its findings—and the Assembly also published a report. That is an example of the way in which value can be added through detailed consideration on a cross-party and cross-body basis before the Government commit themselves to a Bill.
  I am pleased that the Minister noted the benefit of consulting Opposition parties, including the Liberal Democrats and the Conservatives, and I am glad that we assisted him. Indeed if he would like to delegate any substantial part of his ministerial responsibilities, the hon. Member for Leominster (Mr. Wiggin)—I am sure that I can speak for him—and I would be willing to help him out on a daily basis on the assumption that we got a proportion of his salary.
  Mr. Touhig: Modern apprenticeships.
  Lembit Öpik: Indeed, it could be a good example of that. Perhaps we can discuss that after the business today.
  The Minister outlined some of the key benefits of the Bill. They include a single audit body for Wales instead of two, making the public auditing process simpler and handling cross-border working coherently. That can lead to a practical improvement in cross-border relations, for example, in the health service. I have previously raised points about securing English health provision for Welsh patients. There has been some debate about issues that relate indirectly to auditing when I have discussed those matters with the Royal Shrewsbury hospital If the cross-border working element of the Bill is effective, it could improve access to health provision for Welsh patients. Although the measure may, at first sight, appear theoretical and somewhat removed from the interests of the public, some of the aspects that the Minister highlighted will provide a practical benefit.

  943
  An extensive debate was also held in another place, where amendments were tabled. I am obliged to pay tribute to my Liberal Democrat colleagues in another place, who, in their quiet and methodical way, ensured that best practice was derived from Conservative and other Members of the House of Lords.
  Clause 54 probably occupied the greatest amount of time. It places restrictions on the disclosure of information obtained by the Auditor General or an appointed auditor about local government audits and studies, except in some specified circumstances. Other speakers have already given a definition and I therefore do not need to dwell on that. There was great concern that the clause provided for things for which no one was calling. I am optimistic about the Government's willingness to alter that, because they appear to have accepted the arguments. Perhaps I am simply an optimist or willing to trust the Minister because he has an honest face, but I believe that he will ensure that the issues that relate to clause 54 will be resolved before the end of 2004.
  I have already quoted Lords Evans's words when he made an explicit commitment to resolve the section 49 element of the difficulties. The Minister went a little further today when he said that he would try to ensure that the consequential alterations that have to be made to clause 54 would happen by the end of the year. He can correct me if I am wrong, but I believe that those two assurances mean that the Minister will deliver the desired outcome. In a sense, the question is not whether the Minister's words and those of the Lords are appropriate, but whether to trust the Government. I trust them on the matter and can envisage no reason why they would renege on something for which they have accepted the arguments.
  I was intrigued by the observations of the hon. Member for Leominster about the importance of whistleblowing. I suppose that, after all these years, the Conservative view of whistleblowers has altered. Whistleblowers did not have a good time between 1979 and 1997. I chuckled quietly to myself when I heard the hon. Gentleman concerning himself about the sanctions that clause 54 might grant the Government, including imprisonment. Unless my memory deceives me, at least one whistleblower went to prison between 1979 and 1997 under a Conservative Government, explicitly for blowing a whistle on them.
  Mr. Wiggin: While the hon. Gentleman was chuckling to himself, did he consider the difference between audit information and the Official Secrets Act?
  Lembit Öpik: Yes, but until now, the hon. Gentleman made no distinction between whistleblowers who are acceptable and those who are not. He begins to box himself in if he claims that whistleblowers on audit information should be given more latitude than those who have a similar, principled concern about official secrets. One could go as far as to say that whistleblowers violate the Official Secrets Act in the public interest because they feel a greater moral imperative than someone in an audit office, and that they therefore act extremely nobly.
  Mr. Wiggin: I am nervous about straying out of order but the hon. Gentleman should consider the difference
  944
  between the Official Secrets Act, which seeks to protect our servicemen and their lives, and audit information, which under the Bill, is likely to be relevant to local authorities and the way in which they spend public money.
  Lembit Öpik: We could go on about different levels of whistleblowing, but the hon. Gentleman makes a fair point and I shall not play games. There are different levels, but I am encouraged by the Conservatives' recognition that there are times when people should be entitled to blow a whistle without recrimination from Government. That must be good news for whistleblowers everywhere in the Conservative party. If they have information that could be in the public interest, they might even be entitled to a community service award for blowing their whistles.
  I have one last thought about clause 54: the only thing that the Minister did not explicitly describe was the mechanics of ensuring that the clause is brought into line with the promises that he made today. I would be grateful if he could briefly outline the input that the House will have into the changes that hon. Members on both sides agree will be useful.
  I can say without fear of contradiction that this is the greatest Public Audit (Wales) Bill ever to be laid before the House. Although it might not set the good people of Montgomeryshire alight with excitement, they stand to gain from it practically through a more rational, strategic and simplified approach to cross-border auditing. If the Bill is successful in its goals, I fully believe that it will help us to have a sound and sensible public audit of public money, and that it will ensure that the audit process is done once rather than twice, as it is at present because of the duplication in the system. We shall probe some minor changes in Committee, but I am satisfied that there will be enough time to do that under the programme that the Government are proposing. For that reason, the Liberal Democrats support the Second Reading.
  2.21 pm
  Mr. Alan Williams: I welcome the consensus on the Bill. In my Liaison Committee role, I see part of that being attributable to its having had a pre-legislative and draft legislative stage. Strangely enough, that was common practice in the 19th century. It was dropped in the last century and has been embraced again by the previous and current Leaders of the House with the full support and encouragement of the Liaison Committee.
  In a different role, as the Chairman of the Public Accounts Commission in this House, may I say how welcome it is to have this additional armament relating to the scrutiny of public expenditure? It has always been a criticism of the Public Accounts Committee—a remarkable Committee on which I have served for 14 years—that it can deal with only about 50 reports in a year. With £650 billion worth of public expenditure and income to scrutinise, 50 inquiries a year can obviously only scratch the surface. As someone who was, and is, no enthusiast for devolution, may I give it one point of credit for having enhanced public audit in this country? Scotland and Wales, which previously had perhaps only one or two inquiries into their expenditure during the year, now have their own respective bodies. I welcome this strengthening of the organisation in Wales.

  945
  In fact, public audit to some extent rebuts the argument that we do not get anything for nothing, in that the National Audit Office has claimed for years that it makes enough savings to reclaim its costs eightfold each year. The hon. Member for Bridgwater (Mr. Liddell-Grainger) asked who audits the auditors, so he might be interested in this. As Chair of the Public Accounts Commission, I set up an independent value-for-money audit of the National Audit Office, which has reported in the last couple of weeks. That report confirms the NAO's own estimate that it makes eight times as much for the taxpayer as it costs the taxpayer. I hope that the Bill will create a similar experience for Wales.
  Like the Under-Secretary of State for Wales, my hon. Friend the Member for Islwyn (Mr. Touhig) and those new converts on the Conservative Benches, I have a great sympathy for whistleblowers. I remember that, when Rhodri Morgan was in this House, he had a system whereby his telephone was linked to the fax machines in the Wales Office. In some way, whispers used to get to him about what was going on in Wales. On one occasion, he came to see my hon. Friend the Member for Pontypridd (Dr. Howells)—who was also on the Public Accounts Committee at the time—and me. A group of civil servants had asked whether they could meet the two of us because there was something going on in the Welsh Development Agency that they felt needed to be exposed.
  We offered to meet the civil servants in Cardiff, but they said, "No, we're known in Cardiff. We'd be recognised there, and you'd be recognised there. Can we come to London?" So we met them in one of the "W" rooms here. We were about to produce a report from the National Audit Office on excessive car expenses in the WDA, and these two WDA officials came to us and said, "Look, we'd better tell you what's going on there, but you mustn't say where it came from." What they exposed was a conspiracy to privatise two sections of the WDA: the property section and the consultancy section. Feasibility studies had been commissioned on that proposition, yet there was not one word of record of them in the minutes of the board, though the board was involved. There was no record of feasibility studies where one might expect to find them because they had been farmed out to irrelevant divisions in the WDA. One head of a division was so worried about what was going on that he kept photocopies of everything that he had in an attic, in case the situation was exposed at some time.
  Eventually, an ignominious report was produced on the WDA's conduct, which led to resignations. The board had deliberately conspired to conceal what was happening. We subsequently discovered that the only person who seemed to know about it at this end was the then Secretary of State. In our National Audit Office report, we made a recommendation that there should be protection for whistleblowers when the national interest would benefit from their actions.
  It was a paradox for someone who is anti-devolution, such as myself, that there were two exposures at the WDA—another one followed—and the Development Board for Rural Wales was also in the queue. So we had a neurosis about quangos in Wales, which led to the
  946
  clinching argument in the devolution debate: "We will have a bonfire of the quangos." The debate was won by only a quarter of 1 per cent., and without the bonfire argument, it would not have been won. I would have been happy if it had not been, but that is another point. I would suggest that the new body, as part of its first inquiry, should ask, "How did we lose the bonfire of the quangos? Where in the system did it disappear?"
  I welcome the opportunities that will be created by the evolution of separate auditing bodies for Scotland, England, Wales and Northern Ireland. Each, in its own devolved way, will be experimenting individually with methods, approaches and structures. This will give us the opportunity to spend much more time carrying out comparative studies of the ways in which the benefits or disadvantages of different methods emerge in the various parts of the United Kingdom—I have asked the National Audit Office, through the forum of auditors, to consider this—so that we can all learn from best practice. In the case of Wales, for example, I think that most Welsh Members would agree that an area that requires such attention is the delivery of the health service. I am glad that I wrote to the NAO and asked for a comparative examination of the facilities, waiting lists and so on for hip, knee and cataract operations in Wales, England and Scotland. I believe that such a report is relatively imminent and may be available in the summer.
  I welcome this Bill, it enhances the auditing facilities, and I wish the new organisation well.
  2.30 pm
  Hywel Williams: It is a pleasure to follow the right hon. Member for Swansea, West (Mr. Williams) and to hear his positive comments on the setting up of this body in Wales. We cannot claim him as a convert, as he has said explicitly, but it is pleasing to hear his comments, including his pertinent point about quangos. If he is looking for the ashes of the bonfire of the quangos, or perhaps even for some action, he should question not the Assembly, but his friends down there who are in charge. In some ways, it is not an Assembly matter, although it has joint responsibility, and has in the past acted more corporately than it does now.
  On behalf of Plaid Cymru, I join the general welcome for this Bill, which confers new functions on the Auditor General for Wales in setting up this powerful new body for audit. We hope sincerely that its effects will be apparent very quickly. We hope that it will lead to much greater scrutiny, accountability and transparency in relation to public expenditure in Wales, all of which will be very welcome. We agree that a single public audit body for Wales headed by the Auditor General is most desirable, given the current arrangement in Cardiff and the duplication.
  Some hon. Members might recall the slightly jocular tone that I adopted When I made a speech on this matter in the Welsh Grand Committee—[Interruption.] It was a thin house. I said:
  "The word 'auditing' does not conventionally gladden the heart or excite the nerves … it is hardly likely that anyone's famous last words would contain the immortal line, 'I wish I had done a bit more auditing'."—[Official Report, Welsh Grand Committee, 15 July 2003; c. 7.]
  We would do well, however, to note and praise the value of the work done by the Audit Committee of the

  947
  National Assembly. My impression is that it has worked well, and without some of the pyrotechnics that we have seen in other aspects of the Assembly's operations. It has worked well jointly with all the parties that have been involved, and it has worked hard and to a purpose. It has adopted a practical approach.
  The complaint is sometimes heard in the less enlightened parts of the press, especially in north and west Wales, "What has the Assembly done for us?" If we consider the work of the Audit Committee, it claims to have saved at least £90 million out of a budget of £10 billion to £12 billion, depending on which year one counts. That might not seem much, but £90 million is a great deal of money, which, I am sure, has been very well used.
  The hon. Member for Clwyd. West (Gareth Thomas) made the point in the Welsh Grand Committee, which was also raised earlier, that the regulatory impact assessment put the cost of the move at £500,000, but we understand that that figure has increased. I would be grateful if the Under-Secretary could say what the future cost is likely to be, if he is in a position to do so. That would be a matter of interest to Members of the House and to the public in general in Wales. The proper audit of public expenditure is such an important aspect of securing the public good that we should know what it costs, and what the regulatory costs are. Certainly, we should be clearer about the amount of money that has been saved. With due respect to the Under-Secretary, the Secretary of State and previous Secretaries of State, I would venture that the savings that have been achieved since the establishment of the Assembly might not have been achieved under the pre-Assembly arrangements. Judging on the past record, therefore, this Bill promises much. We will look for reports of positive results in the future.
  As the Under-Secretary and other Members have said, this Bill has been the subject of a great deal of scrutiny. Irrespective of the debates and discussions in Cardiff, the Welsh Affairs Committee and Welsh Grand Committee have also considered the matter. Of course, it has also been the subject of the usual procedures in the passage of Bills through the other place. On behalf of Plaid Cymru, I hope that it will now proceed quickly to Committee, and that it will be examined in the proper amount of detail. We will be looking to make a positive contribution to that process.
  Members have already referred to a number of improvements achieved in the other place. Plaid Cymru Members were very pleased to note to the Government's change of heart on clause 54. I am glad that the Government saw sense, or at least realised that their approach, and that of the Wales Local Government Association, was inconsistent with the principles of freedom of information, and was thus unsustainable. We will be looking to make sure that the Government keep their word.
  Lembit Öpik: For the avoidance of any possible doubt, is the hon. Gentleman aware that quite a few people in local government in Wales want this change, too? Delyn Liberal Democrats, for example, are very keen to ensure that these changes are made, because they have concerns that some of the bad things that happened in Flintshire might end up being covered up instead of exposed if clause 54 is not amended. Does he
  948
  therefore agree that since the argument has been totally won, the Under-Secretary is under a tremendous obligation to make sure that he delivers to the timetable that he has promised, which is this year?
  Hywel Williams: I am grateful for that intervention and I agree entirely with the hon. Gentleman. As I said, we will make sure that we do our best to hold the Government to what the Minister has said this afternoon. Rather than carp at any questions about motivation or what has happened in the past, I want to accept and celebrate the change in the other place.
  I hope to have the opportunity in Committee to examine this Bill in detail. Briefly, I want to comment on a couple of issues that have been raised by other Members. To make a broad point, were we to compare part 2 with part 3, we would see that part 2 is concerned with the audit of local government bodies, and runs to four chapters and 47 clauses. Part 3, however, is concerned with the NHS and contains a mere five clauses. How does one account for this startling variation? Is audit in the NHS simpler or more straightforward? Given the huge expenditure on the health service, I scarcely think so. Is it that local government is inherently more complex? As a former council employee, albeit a long time ago, I do not underestimate the complexity of local authority finance, even in such well-run authorities as Gwynedd county council, both the old and the new. We have had yet another reorganisation of the health service, and whatever its merits or demerits, no one could claim that the establishment of 22 local health boards and a wide variety of some 30 other bodies in the new system is a move towards simplicity.
  The NHS is a complicated organisation, and has five clauses about it, whereas local authorities, which are perhaps equally complicated, have a huge section of their own. Perhaps it is not that local authorities are more complex, or that the health service is a beacon of organisational simplicity and clarity, but that the clauses relating to the health service are new, whereas the chapters and clauses relating to local government replicate the existing legislation, but with a Wales tag. For that reason, many who welcome the intention and hope sincerely that the Bill will increase accountability also consider that an opportunity has been missed—the opportunity to simplify existing law and write new law suited to Welsh circumstances, rather than producing a Welsh version of the arrangements for England and Wales.
  As others have said, the reproduction and adaptation of existing legislation has led to inconsistencies. For instance, the penalty arrangements in clauses 5, 19 and 29 vary. One clause provides for a £20 fine for each day on which an offence continues, while the others do not. Some might say that fining public bodies is not the right way in which to proceed. After all, the auditor has a right to seek injunctions; alternatively, the miscreant's authority could be hauled before the Audit Committee. Others might say that a £20-a-day fine is derisory, and hardly constitutes encouragement to comply.
  All I am saying—and I will repeat it in Committee—is that there is an inconsistency in the Bill which arises from the nature of the legislation being reproduced in it. I shall not proceed with that critique now, but I assure the Minister that my party will be tabling amendments.

  949
  Let me conclude by emphasising the importance of keeping the Assembly and the Audit Committee in the loop, engaging them when appropriate, and enabling them to continue their good work in maintaining the high standards of probity in public expenditure that we value so much.
  2.42 pm
  Mr. Andrew Robathan: This is not a bad Bill, but as we have heard from the hon. Member for Caernarfon (Hywel Williams) and the Chairman of the Welsh Affairs Committee, the hon. Member for Clwyd, South (Mr. Jones), it could be improved. Nor is it a small Bill, and it will require detailed scrutiny.
  Some may ask why an English Member representing a midlands shire constituency should speak on this Bill. It is true that there are not quite as many Conservative MPs in Wales as we might wish, but I do have Welsh antecedents. My father was born in Llandaff, and my grandfather was headmaster of Llandaff cathedral school. Both my great-grandfather and my great-great-grandfather were doctors in Risca, in the Minister's constituency of Islwyn, in the valleys. Although I am not actually Welsh myself, I can claim to be Welsh when I want to be. I am certainly much more Welsh than the Secretary of State, who has no Welsh connections at all apart from having happened to end up in his present berth in Neath.
  Hywel Williams: Does the hon. Gentleman agree with a past president of my party, Dr. Gwynfor Evans, who once famously stated that anyone can be Welsh as long as he is prepared to take the consequences?
  Mr. Robathan: Funnily enough, I do agree, not least because those who stand next to me in church always say, "You must have some Welsh antecedents because you sing so loudly"—if not so beautifully.
  Lembit Öpik: May I ask who the hon. Gentleman supports in the current Euro football competition?
  Mr. Deputy Speaker: Order. It might be a good idea if the hon. Member for Blaby (Mr. Robathan) returned to the subject of the Bill.
  Mr. Robathan: I accept your strictures, Mr Deputy Speaker. Apart from anything else, I believe in neither the cricket test nor the football test. Furthermore, I think that football tends to be played by rather overpaid louts. I say that in my constituency, so everyone knows that it is what I think—and I believe it has been proved this week.
  Like the right hon. Member for Swansea, West (Mr. Williams), I do not particularly like devolution, and I do not particularly like the Welsh Assembly, for which only one out of four Welsh voters voted. In fact, I have heard Welsh Members of Parliament—not members of my party—describe the Assembly as a rather second-rate county council, although I accept that it is doing good work.
  Mr. Wiggin: My hon. Friend will not need to be reminded that the Conservative Assembly Members were recently proved to be the most hard-working group. Perhaps that is one reason why he was able to be complimentary about the Assembly.
  Mr. Robathan: I did not know that, although of course I support the Conservative Assembly Members. Nevertheless, I am not sure that Wales is as much a better place as it was claimed that it would be when the Assembly was established. It is up to the Welsh to decide what form of government to have, but I repeat that only one person in four voted for the Assembly.
  It is because of my distrust of devolution that I have certain qualms about the Bill. It appears to be non-controversial, but the taxes that will fund it are paid by all taxpayers. The hon. Member for Blaenau Gwent (Llew Smith), who is not here now, pointed out that the costs of the Assembly, originally estimated at £20 million a year, are now £100 million.
  According to the explanatory notes, the compliance costs will be borne by the Assembly, and the Assembly considers that the Bill will not result in any additional budgetary costs to it or other public bodies. As I have said, however, the original estimate of the Assembly's costs was itself wrong.
  I understand that we shall be bringing together 45 staff from the National Audit Office and 200 from the Audit Commission. I hope that that will not involve huge compliance costs. I am not particularly au fait with Cardiff these days. I hope the Minister will tell me whether a new building will be needed, and how the costs will be paid. I understand that the costs of setting up the new arrangements will be £1 million.
  I was particularly puzzled by what the right hon. Member for Swansea, West said about the Public Accounts Commission. It seems to me that the Public Accounts Committee here should be able to examine what is done in Wales. The right hon. Gentleman said that it could not, whereas the Minister said that it could. The discrepancy needs to be cleared up.
  According to clause 40, any public-interest report will be sent to the Home secretary—a UK post, obviously. Surely it should also go to the Public Accounts Committee as well if that is requested.
  We have discussed the conflict between the Freedom of Information Act and clause 54. It is important to establish whether the Act will override the clause. I do not impugn the Minister, but I think that the issue should be sorted out now, in the Chamber. After all, there is no mad rush for the Bill.
  The way in which the Bill reflects on whistleblowers has also been discussed. The Minister has a very good record in that regard. I remember a debate on the subject. I think I supported the Minister then, which was surprising, as one or two Whips were quite keen for me not to.
  Where is that bonfire of the quangos? We should not take everything on trust.
  A piece of non-controversial legislation is all too easy to nod through. Much of our legislation is not sufficiently considered. I do not pretend to be either an accountant or an expert on auditing, nor do I represent a Welsh seat; but I think it important to the stature of

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  the House that we produce well-thought-through, precise, detailed legislation. Questions have already been asked about various aspects of the Bill. Let me add that we have a duty to ensure that any moneys raised from our constituents and spent on whatever we decide is spent well.
  2.49 pm
  Mr. Ian Liddell-Grainger: As a Scotsman hiding in Somerset, I claim even less reason than my hon. Friend the Member for Blaby (Mr. Robathan) to speak in the debate. Someone once asked me what my view of Wales was from my seat, and I said, "Overlooking it." I apologise to all Welsh Members for that faux pas.
  I agree with other hon. Members that this is not a bad Bill, but I should like to speak about a part of the Bill that I do not like. In a wonderful bit of double speak, clause 6 refers to the provision:
  "The Auditor General for Wales may borrow sums in sterling by way of overdraft or otherwise for the purpose of meeting a temporary excess of expenditure over sums otherwise available to meet that expenditure."
  That is my problem with this generally good Bill.
  The whole point of having an Audit Commission is to be able to follow an audit thread. I am worried that the Auditor General can borrow money, even on a temporary overdraft basis, in order to follow an audit thread for one simple reason. If he cannot follow the thread through private or public accountability—in other words, if it has been delegated to a private auditor—it means that either the National Assembly for Wales or the British taxpayer will have to be pick up the tab. There is no other way round it. In respect of Wales, of course, it means the Welsh taxpayer.
  That is my main difficulty with the Bill. The audit trail has to be examined, but not through the eyes of the Welsh, the Scots, the Irish or anyone else. It must be possible to follow a thread where public money is involved. Too often in this country, audit trails have left the taxpayer out of pocket by millions of pounds with absolutely no benefit—and certainly no prosecution at the end of the day. It worries me that we are allowing the Auditor General to run an overdraft. Why should he need to run an overdraft? Do we not have enough money in the country? Is the Chancellor not telling us something? Are we running all this on Barclay cards? That is not the way to do an audit trail.
  The fees are another problem. New section 93A in clause 7 states:
  "The Auditor General for Wales may charge a fee for auditing a person's accounts."
  If he is delegating that responsibility to a well-known firm of accountants—it does not matter which—and that firm is unable to retrieve the money from the person because of a dispute, what happens? Does the Auditor General for Wales sue the company to get the money back or does the delegated auditor, a private individual, sue for it? If the company goes into liquidation in the meantime, what do we do? Do we pursue the company directors, or does the Welsh Assembly have to pick up the tab? Exactly what would happen in those circumstances has not been clearly explained.
  Much has been said about clause 5. It is a crucial provision, dealing with auditing of registered social landlords. I doubt whether many Members would be
  952
  unable to recall occasions—I have spent only three years in the House—on which such landlords were brought into question and people were anxious to follow them up. The noble Baroness Noakes said:
  "The criminal law is a blunt instrument for a public audit regime … I am reinforced in this by the absence of criminal sanctions".—[Official Report, House of Lords, 1 April 2004; Vol. 659, c. 1461.]
  That just about sums it up. The Minister said that we audit social landlords correctly by our ability to follow the audit trail and secure what information we want. However, at the end of the day, we do not have a criminal sanction. Social landlords can be very good at disappearing. A company may have a problem, the social landlords may leave, the company goes down the pan and once again the taxpayer is left to pick up the bill. Will the Minister reflect on Baroness Noakes' view of the criminal law as a blunt instrument and ensure that people realise that it is unacceptable to walk away from a company because the Audit Commission of Wales is in pursuit.
  There are nine subsections to clause 5, which gives the Auditor General the ability to pursue reasonable costs, but when he delegates the responsibility for investigating a company, who takes the decision? Is there a time limit and a budget? Is there a narrow or broad brief, or is the delegated body asked to write its own brief? I ask those questions because we all know what happens—I am a capitalist and do not disapprove of commercialism—when something is given to a private company. It will obviously try to keep it all going and there is a tendency—dare I say it to any lawyers or accountants in the Chamber—to egg up the costs. What powers will the Auditor General for Wales have to rein in costs at all levels? Clause 5 does not make that clear, so we may have to amend later clauses to tighten it up.
  I want to move on to the enormous amount that the Audit Commission has achieved in the last year. It has dealt with late payments to farmers in Wales, the National Council for Education and Training for Wales, compensating farmers for tuberculosis—I had to get that in somewhere—in Wales, the renewal of private sector housing, the management of the delivery of hospital cleaning services, the procurement of primary care medicine and the management of further education and estates in Wales.
  I have two questions for the Minister. First, has the Audit Commission done everything that it wanted? At the moment it has a very large staff—about 4,000 people—because it covers England and Wales. Are there further objectives that have been prevented because of stepping on the toes of the Welsh Assembly? When the Bill is enacted and the Audit Commission for Wales is established, it will want to do its job to the best of its ability. As my hon. Friend asked a few moments ago, will there be sufficient numbers of staff seconded into Wales to carry out the role properly? What it did last year certainly amounts to an ambitious programme, never mind what it might be asked to do in the future. Currently, there 2,300 staff dealing with England and Wales, including 1,500 commissioners and 450 inspectors. I believe that the number of staff taken on specifically for Wales is way below even a third of that. It is important to look further into that problem.

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  Costs are also important. The fifth report of the Welsh Affairs Committee supplies the figure of £500,000. The report states:
  "We have to express some concern that there is as yet no realistic published estimate of set-up costs … or savings, arising from"
  the new office. It continues by stating that that is
  "exactly the sort of failing for which auditors are rightly swift to criticise other organisations. We hope that … a clearer idea of costs"
  will emerge. Does the Minister have any idea of the costs that will accrue? I see that the Chairman of the Welsh Affairs Committee is in his place. It is surely crucial to know what sort of budget the Auditor General for Wales will have on day one. Presumably, he will want to make progress as quickly as possible when the Bill is enacted. Can the Minister give us an assurance about the total costs?
  In conclusion, this is a good Bill, but it does need tweaking. Some glaring provisions stand out and need to be amended. I have already mentioned the point about the criminal law. The provisions need tightening up. Cross-border co-operation is important—I do not mean that Wales is not part of Great Britain—so the provisions must be sensible. If we cannot follow up the trails properly, every one that the Auditor General wants to pursue will fail. In the eyes of the law, the job will not be deemed to have been done sufficiently, which cannot be acceptable to the Minister. If we need retrospective information, the Minister must ensure that the law gives us the ability to use it. It is all very well for the Bill to say that it can be done, but when there is no tie-up between England and Wales, following the split, there is the possibility that many things that desperately need to be pursued will fall through the lines.
  2.59 pm
  Mr. Hugo Swire: The Opposition broadly welcome the Bill, as has been heard this afternoon. It must make sense to consolidate the audit arrangements for public bodies in Wales by replacing the Auditor General for Wales and the Audit Commission in Wales with the Wales Audit Office or, as it is called—this might be one of my few attempts at Welsh this afternoon—y Swyddfa Archwilio Cymru. I think that my hon. Friend the Member for Leominster (Mr. Wiggin) will squirm in his seat at that when he reads the Welsh press tomorrow. He, of course, is a man who started off by learning the Welsh national anthem and I am told that he is progressing well in that language. I have to say that my credentials are somewhat more challenged, in that I took a lot of convincing that the hon. Member for Alyn and Deeside (Mark Tami), who was in his place earlier and who serves with me on the Northern Ireland Affairs Committee, was not in fact a Member of Parliament for Scotland—a mistake that I made early on in my parliamentary career.
  We will nevertheless put that behind us and move on to the substance of the matter before us this afternoon. The Minister was, in his usual manner, reasoned, conciliatory and generous to many this afternoon, including the Select Committee on Welsh Affairs, and we thank him for that. I thank him, too, for the tribute
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  that he paid to our Conservative colleagues in the other place. We all agree that their diligence has ensured that this Bill has been greatly improved. It has to be said, however, that some inconsistencies and genuine concerns remain.
  It is worth reiterating that the Opposition are disappointed that this is the only piece of Wales-specific legislation, in spite of the fact that the National Assembly for Wales has proposed five Bills. Welsh Conservatives, Liberal peers, Plaid Cymru and Labour, in the shape of Lord Morris of Aberavon, have all, as we have heard, shared that sense of disappointment.
  In his opening remarks, the Minister referred to the cross-border reviews and the co-operation between England and Wales. That part of the Bill is no doubt to be welcomed. However, what is perhaps less welcome is the Government's failure to introduce something new and radical—something Wales-specific. By mirroring the Audit Commission Act 1998, the Government have missed a trick and, as my hon. Friend the Member for Leominster has said, we shall seek to remedy that in Committee.
  The hon. Member for Blaenau Gwent (Llew Smith) and the right hon. Member for Swansea, West (Mr. Williams) both mentioned the bonfire of quangos—or perhaps we should say the "bonfire of the vanities"—and commented that there has not been so much as a spark, let alone a bonfire. Perhaps that should now be looked at as a priority. The Government's financial record on matters Welsh is, I have to say, a little questionable. I asked the Secretary of State for Wales back in May what the cost of the Welsh Assembly to the public purse was estimated to be at the commencement of that project, and the answer was that the additional running costs of the Assembly would be £15 to £20 million more than the cost of running the Wales Office. That is in addition to the £55 million or so that we are now facing for the establishment of the Welsh Assembly. Those costs in no way mirror those of the Scottish Parliament, but we can see how the costs of such projects can escalate very quickly.
  Mr. Liddell-Grainger: My hon. Friend is making interesting points. Perhaps I may help him. A major part of the draft Public Audit (Wales) Bill was devoted to the cost of setting the Welsh Assembly up but this Bill contains no actual breakdown of costings. Does my hon. Friend agree that the Minister must give costings in line with what the Welsh Affairs Committee asked for?
  Mr. Swire: My hon. Friend makes a customarily good point, but I shall turn to costings in a minute, if I am able to in the limited time that I have left this afternoon.
  The Minister spent much time telling the House how the Audit Office will scrutinise expenditure in Wales, but not much time telling us what the cost of the legislation will be. The Government have already admitted that their initial start-up costs were inaccurate, and the latest regulatory impact assessment has almost doubled that cost, from £500,000 to just under £1 million. It would therefore be helpful if the Minister could give us an up-to-date and, hopefully, final figure when he replies this afternoon.

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  My right hon. Friend the Member for East Yorkshire (Mr. Knight), who is no longer in his place, made a good point about the scrutiny of expenditure in Wales by the Public Accounts Committee. I hope that the Minister will seek to address that concern later this afternoon.
  It would be quite wrong for me to continue in my comments without thanking those two excellent volunteers, my hon. Friends the Members for Blaby (Mr. Robathan) and for Bridgwater (Mr. Liddell-Grainger), who made contributions in their own way. My hon. Friend the Member for B1aby, who was quick to stress his Welsh antecedents, comes from a distinguished line of doctors and teachers from Llandaff and was more than happy to take the responsibility for being Welsh. He raised concerns about costs, and questioned whether a new building was needed, which, again, has not come out so far in the debate. He thought that well-thought-out and precise legislation was needed, and that we had a duty to ensure that money raised from our constituents was well spent. I think that most of us in the House would agree with those sentiments. Those are the prevailing sentiments with any kind of legislation, certainly among Opposition Members.
  My hon. Friend the Member for Bridgwater, who takes the responsibility of being not a Welshman but a Scot in Somerset—perhaps an altogether more difficult position—made some probing interventions throughout the debate and, like all good Scots, concentrated on the financial aspects of the Bill. He made a series of points on the auditing of social landlords. Those good points were well made, and are worthy of a response from the Minister. He concluded by saying that he thought that although this was a good Bill, it needed tweaking. I look form and to joining him in the tweaking process in Committee later on this Session.
  The Minister made many reassuring noises about clause 54 and about how clause 49 was to be amended in favour of disclosure. However, we are being asked to accept that those very necessary changes will be made after enactment—although in all fairness, by the end of 2004. My party believes that it is quite wrong and unnecessary to introduce new legislation without making those fundamental changes at this stage.
  We are, it must be remembered, talking about large sums of money, and we have only to look to Brussels and the corruption in the European Union to see how whistleblowers have been treated in the past—and yes, regrettably, by a Welsh ex-Labour MP and party leader. That is in sharp contrast with the excellent record of the Under-Secretary of State for Wales, the hon. Member for Islwyn (Mr. Touhig), who, ironically, succeeded the gentleman to whom I am alluding in that seat. The hon. Member for Montgomeryshire (Lembit Öpik) went off at a slight tangent about whistleblowers. I know that he plays in a band, so perhaps he should confine his blowing to his harmonica.
  For once, however, the House is on the whole in considerable agreement on the Bill. We think that it has merit, and we look forward to the Committee stage, when we can introduce those amendments that will make the Bill even better, more workable and more relevant to the people of Wales. I look forward to the Minister's response, and hope very much that rather than repeating some of the points that he made in his
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  very good introductory speech, he will seek to answer some of the excellent probing points made by Opposition Members this afternoon.
  3.8 pm
  Mr. Touhig: With the permission of the House, Mr. Deputy Speaker, I shall reply to the debate. We have had an interesting and highly constructive debate on the Public Audit (Wales) Bill. Many good points have been made, and I can assure Members of all parties that the Government will consider those points carefully as we move towards Committee. The Bill's key objective is to create a simpler and more rational structure for public audit in Wales. That will break down operational boundaries and assist in the development and spread of best audit practice.
  The Bill is based on the principle that public audit in Wales should be a simpler, more co-operative and more proactive process. It should reduce the burden of audit and inspection activity in Wales, without diminishing audit standards. That point was expressed by a number of bodies that responded to the public consultation on the Bill. For three years running, the Auditor General's annual report to the Assembly has shown that overall standards of financial management and probity are high. However, there can be no room for complacency and this Bill will ensure that we are able to build on that achievement. Through co-operation and consultation, the Bill will encourage a more strategic and inclusive approach to planning and carrying out audit, examination and inspection work. In addition, it will ensure that other bodies outside Wales can work with the Auditor General in developing areas such as audit standards and practice. That work has an increasingly international dimension.
  The Auditor General and his staff have much to contribute. They have a wealth of expertise and experience, and it is fitting that they should play their full part. Some have said that this Bill is a patchwork of different provisions rather than a coherent whole. I disagree. Key people, such as the Auditor General for Wales and the director general of the Audit Commission in Wales, have wholeheartedly welcomed the Bill's proposals.
  The very real benefits that this Bill will bring to the public audit process should not be lost in the wider debate. The Audit Commission in Wales, the Auditor General and the staff of the National Audit Office have done, and continue to do, excellent work in upholding and improving the high standards of public accountability that exist in Wales.
  We have heard today about the pre-legislative scrutiny that the Bill has gone through. I pay tribute to the members of the Welsh Affairs Committee under the chairmanship of my hon. Friend the member for Clwyd, South (Mr. Jones), and to those in the Welsh Assembly's Audit Committee who played a strenuous part in the consultation.
  In my opening remarks, I took a number of interventions from Opposition Members, to which I shall now respond. The hon. Member for Bridgwater (Mr. Liddell-Grainger) asked whether the Auditor General for Wales could appoint auditors for social landlords in Wales, and I want to amplify the response that I gave. The Auditor General for Wales has no

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  power to appoint auditors to registered social landlords in Wales because such landlords are not public bodies, and not all receive their funding from the Assembly. However, he will be able to undertake value-for-money programmes in the registered social landlords sector, with the agreement of the National Assembly.
  The hon. Member for Bridgwater also asked whether the publication of a report under clause 22 would breach the Human Rights Act 1998. The answer is no: local government bodies cannot be victims under the terms of that Act.
  My right hon. Friend the Member for Swansea, West (Mr. Williams) made an important and welcome contribution about the locus of the PAC in respect of the National Assembly. The PAC has a locus, in the sense that the Government of Wales Act 1998 provides that the Assembly's Audit Committee can, on behalf of the PAC, take evidence on audit issues, and report back to the PAC. That is covered by section 102(2) of the 1998 Act.
  The hon. Member for Leominster (Mr. Wiggin) welcomed the Bill. He said that it was a good piece of legislation, but that some opportunities had been missed. I am sure that we will explore that further in Committee. He was concerned that, although the Auditor General could audit the NHS, he could not do the same for local government. That is because local government enjoys a distinct democratic legitimacy that is bestowed by the electorate. Health bodies do not have that, as their members are not directly elected by the public. The Government are keen to ensure that local government retains its democratic independence. That is why we feel it right that the Auditor General should not be the auditor of local government, but that he should be able appoint those who will perform that function.
  The hon. Gentleman asked about the details of the orders to amend clause 54. At this stage, I cannot go into detail about how those orders will be drafted, as discussions are continuing. As soon as I have some information, I shall make it available to the House. If it becomes available while the Bill is in Committee, I shall bring it to the attention of colleagues, as I think that people should know the Government's plans.
  Mr. Wiggin: I am grateful for the Minister's kind offer. However, the Committee sittings may start as soon as next week, so he has only a small window of opportunity in which to deliver that information.
  Mr. Touhig: I accept that, but I merely want to make it clear to the House that I shall do all I can to get that information to colleagues. I recognise that I am asking for support for the Bill, and that that requires a degree of trust that the Government will introduce amendments later in the year.
  The hon. Gentleman mentioned whistleblowers. He was worried that they might be deterred, but I do not believe that the Bill will cause that to happen. The Auditor General for Wales is the prescribed person for the purposes of the Public Interest Disclosure Act 1998. My private Member's Bill that would have had the same effect was thwarted by the previous, Conservative
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  Government. In fairness, I should say that the 1998 Act was introduced by a Conservative Member. It was supported by this Government and subsequently enacted.
  Various hon. Members asked about the running costs of the Auditor General's office. The Auditor General can raise income through fees and charges. The gap between estimated income and expenditure is met by the National Assembly. I believe that, in 2003–04, that amounts to about £1.5 million.
  In the Welsh Grand Committee, the hon. Member for Ribble Valley (Mr. Evans) raised the question of set-up costs, and various hon. Members asked the same question this afternoon. When we carried out the pre-legislative scrutiny, we gave a figure of £500,000 for set-up costs, but that was before a working group produced a detailed analysis. The new estimate is £987,000, but more than half the difference between that and the original estimate is accounted for by costs that were not anticipated originally. Non-recoverable value-added tax charges amount to £147,000, and £127,000 is accounted for in the appointment of a dedicated project manager. Originally, project management was to be done as an in-house exercise and funded by NAO and Audit Commission resources, but that is no longer the case. Finally, the auditor General for Wales has estimated costs for information and communications technology at £350,000—over £150,000 more than originally anticipated.
  The revised costs were considered and approved by the National Assembly's Audit Committee in May, and await approval by the Assembly's Finance Minister. I remind the House that, in evidence to the Welsh Affairs Committee in June 2003, Sir John Bourn said that the original estimate of £500,000 was a "ball-park" figure that he did not consider irresponsible. However, the estimates have had to be revised, and it is right that colleagues should seek—and be given—information about the new costs forecasts.
  My hon. Friend the Member for Clwyd, South (Mr. Jones) welcomed the improved access rights to be given to the Auditor General, and I am sure that all hon. Members agree with that. I want to emphasise again the important work that the Welsh Affairs Committee performed in the pre-legislative scrutiny. That scrutiny process is now a matter of course for Welsh Bills, and the Committee plays a vital role in that. It will now begin consideration of the draft transport Bill for Wales, which we look forward to debating in the Welsh Grand Committee, perhaps next month.
  The hon. Member for Montgomeryshire (Lembit Öpik) said that he had not been lobbied about an audit Bill by any of his constituents. I am not surprised at that, but I am sure that all hon. Members would agree that when something goes wrong with any public service issue and costs arise, we all turn to the auditors to find out why. He expressed concerns about clause 54 and asked what role the House would play in the amendment to which the clause refers. The amendment will be made through an order that will be laid and approved by a resolution of each House of Parliament. The same procedure will apply to the amendment of section 49 of the Audit Commission Act 1998. I stress that clause 54 would not prevent an auditor from

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  disclosing evidence of corruption or malpractice if they encountered it and felt that they had a duty to bring it to the public.
  The hon. Gentleman also spoke about the way in which the previous Government treated whistleblowers. He was right to make that point. Indeed, when I presented a private Member's Bill on the subject, it was thwarted by the previous Government, who did not wish to see it on the statute book.
  My right hon. Friend the Member for Swansea, West welcomed the Bill. I was pleased about that because he brings considerable experience and knowledge of audit matters to the debate. All hon. Members value his contribution and he speaks with authority. I have no doubt that we will take account of the points that he has made and focus on them as we go through Committee stage.
  The hon. Member for Caernarfon (Hywel Williams) joined in welcoming the Bill. As I recall the Welsh Grand Committee debate, he was the only hon. Member who brought a degree of humour to our proceedings. We certainly enjoyed that, and I look forward to the contributions that he will make in Committee. He asked whether there was any information about the future costs of the new Wales Audit Office. The Auditor General will submit his estimate of income and expenditure to the Assembly Audit Committee in autumn this year in the normal way, and it is not possible for me at this stage to pre-empt those estimates.
  The hon. Gentleman also asked how we could account for the huge difference between the sizes of part 2, covering local government, and part 3, on the NHS. Of course, the drafting and structure of a Bill are matters for parliamentary counsel. Hon. Members may recall that the Health (Wales) Bill, which reorganised parts of the health service in Wales, ran to 10 clauses, so one cannot read too much into the point that the hon. Gentleman made.
  The hon. Member for Blaby (Mr. Robathan) said that he felt that the Bill was not bad but could be improved. If he is on the Committee, I shall look forward to his contributions, because when I introduced my private Member's Bill to protect whistleblowers, I believe that he came into the Chamber in order to cause me some grief but was swayed by the power of my argument, and I certainly felt that I had an ally in him as we reached the conclusion of the debate. I was pleased to have him on my side, and was grateful for his contribution.
  The hon. Gentleman also referred to the costs of setting up the office and asked where the office would be located. I will deal with that point in a moment. He also touched on the extensive pre-legislative scrutiny. He said that clause 40 required public interest reports to be sent to the Home Secretary, but asked whether they should not also be sent to the Public Accounts Committee. Clause 40 deals only with public interest reports on police authorities in Wales and that is why it is felt that the Home Office is the appropriate recipient of those reports.
  The hon. Gentleman asked whether there would be new building costs. The new body proposes to operate from the existing accommodation. The offices of the Auditor General for Wales and the Audit Commission are in close proximity. When the leases of the property
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  expire, a rationalisation of accommodation may take place, but it will be for the Auditor General to come forward with proposals.
  The hon. Member for Bridgwater welcomed the Bill and made a number of important points. I will seek to cover some of them. He raised some detailed points to which I am not able to give a proper response today. I propose to write to him on any points that I do not cover and place a copy of my letter in the Library so that all hon. Members are aware of my responses. The hon. Gentleman asked what powers the Auditor General had to reign in costs at all levels. Contracts for the provision of services to the Auditor General will be the subject of the usual public procurement rules. He asked why there was a need for an Auditor General to run up an overdraft. It is overstating it to say that he would run up an overdraft. The facility gives the Auditor General the ability to cover short-term deficits of income and expenditure. The Auditor General's remit is expanding and this facility is also open to the Audit Commission and the Auditor General for Scotland. This aspect of the finances of the Auditor General for Wales would be subject to scrutiny by the Assembly's Audit Committee, and by the Auditor General for Wales' own external auditors.
  Mr. Liddell-Grainger: The other part of my question was: what would happen if the money could not be reclaimed but had been borrowed? Who would be responsible for getting the money back if there was a shortfall?
  Mr. Touhig: That is one of the matters that I will write to the hon. Gentleman about at a later stage.
  I welcome the hon. Member for East Devon (Mr. Swire) to his first appearance on the Front Bench in a Welsh debate. I look forward to his future contributions. He made some powerful points, and I am sure that we will welcome the contributions that he will make in Committee.
  Mr. Robathan: Will the Minister join me in hoping that my hon. Friend will be able to improve his accent and pronunciation of Welsh words?
  Mr. Touhig: I have no doubt that the hon. Member for Leominster will be giving him some lessons, or that Labour and Opposition Members will seek to help him improve his pronunciation of Welsh place names. He has a long way to go, but if he is a willing pupil there are plenty of good teachers here.
  Finally, I thank all hon. Members who have taken part in the debate today. The Bill is an excellent example of how the Government and the Assembly work in partnership in the best interests of the people of Wales, and I invite hon. Members to give it a Second Reading.
  Question put and agreed to.
  Bill accordingly read a Second time.

PUBLIC AUDIT (WALES) BILL [LORDS] (PROGRAMME)
Motion made, and Question put forthwith, pursuant to Orders [28 June 2001 and 6 November 2003],
That the following provisions shall apply to the Public Audit (Wales) Bill [Lords]:
Committal
1. The Bill shall be committed to a Standing Committee. Proceedings in Standing Committee
2. Proceedings in the Standing Committee shall (so far as not previously concluded) be brought to a conclusion on Thursday 1st July 2004.
3. The Standing Committee shall have leave to sit twice on the first day on which it meets.
Consideration and Third Reading
4. Proceedings on consideration shall (so far as not previously concluded) be brought to a conclusion one hour before the moment of interruption on the day on which those proceedings are commenced.
5. Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on that day.
6. Sessional Order B (programming committees) made on 28th June 2001 shall not apply to proceedings on consideration and Third Reading.
Other proceedings
7. Any other proceedings on the Bill (including any proceedings on consideration of Lords Amendments or on any further message from the Lords) may be programmed.—[Paul Clark.]
Question agreed to.

PUBLIC AUDIT (WALES) BILL [LORDS] (MONEY)
Queen's recommendation having been signified—
Motion made, and Question put forthwith, pursuant to Standing Order No. 52(1)(a) (Money resolutions and ways and means resolutions in connection with Bills),
That, for the purposes of any Act resulting from the Public Audit (Wales) Bill [Lords] it is expedient to authorise the payment out of money provided by Parliament of—
(a) any increase attributable to that Act in the sums payable, by virtue of any other Act, out of money so provided; and
(b) any expenses of the Secretary of State under that Act.—[Paul Clark.]
Question agreed to.

TRANSPORT
Motion made, and Question put forthwith, pursuant to Standing Order 118(6)(Standing Committees on Delegated Legislation),
That the draft British Transport Police (Transitional and Consequential Provisions) Order 2004, which was laid before this House on 20th May, be approved.—[Paul Clark.]
Question agreed to.

Fishing Boat Sinking (Loch Ryan)
Motion made, and Question proposed, That this House do now adjourn.—[Paul Clark.]
3.25 pm
Andy Burnham: On 12 July 2003, a fishing boat sank in Loch Ryan in west Scotland, claiming the lives of three of my constituents. Shaun Ridley and his two sons, Steven and Michael, were returning to shore with their grandfather, Brian Ridley, and family friend, Harry Houghton, after the five had enjoyed a successful day's fishing. It ended in appalling tragedy when water taken over the bow of the boat submerged it and took it down in a matter of minutes. Shaun and Michael were airlifted from the water after four hours. Despite the efforts of hospital staff, they could not be revived. Steven's body was found six weeks later, miles down the coast.
It is impossible to describe the devastating impact that the events have had on a loving family, the survivors and, more widely, a close-knit community in West Leigh. That community has rallied round and provided great support, with many people travelling to Scotland to help with the search for Steven. The circumstances and causes of the accident have been the subject of a detailed inquiry by the marine accident investigation branch. Its report was published in April and makes eight separate recommendations to prevent such a terrible accident from reoccurring. Port authorities were asked to impose speed limits for fast, conventional ferries when entering and leaving port. Ferry operators were asked to ensure full adherence to the requirements for permanent lookout. Coastguard and rescue services were required to review their practices with a view to eliminating the alarming errors that were made in this case. Those are strong recommendations and nothing short of full implementation will do. I hope that the Minister in his reply will outline the steps that his Department is taking to ensure that that is the case.
In my view, the strength of the recommendations is at odds with the body of the report and its analysis of the accident. It is the firm view of the family and survivors that the report is selective in its use of supporting evidence, does not provide an accurate record of events and lacks balance in its analysis of them. It makes unequivocal criticisms of the fishing party, but seems to be at pains to mute and minimise criticisms of professionals and explain away their failings. As Pauline Ridley, wife of Shaun and mother of Steven and Michael, points out, there is a great difference between the health and safety responsibilities of a major industry and a family out sailing for a day's fishing.
Pauline is here today to witness our proceedings, together with her mother, Joan, and father, Tommy. Brian Ridley is accompanied by his wife, Marie, mother of Shaun, and the boys' grandmother. Harry Houghton is joined by his wife Audrey. Today is yet another difficult day for them, but they are here primarily to stop such a tragedy happening to another family and because they feel that they cannot leave the report unchallenged.
I have read and re-read the report and spoken on many occasions to the family and survivors. I have had to ask myself the difficult question—although the

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answer may be hard to accept—whether the MAIB has reflected the full truth and Fairly apportioned responsibility for this terrible accident. I have to say that I do not believe that it has and I will outline detailed concerns and questions that require further investigation.
I want to set out four points of relevant context. First, the House should know that wash from ferries operating in and out of Loch Ryan is a matter of long-standing local concern. In advance of today's debate, I spoke to my right hon. Friend the Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) whose constituency borders the loch. He confirmed that, on many occasions over the years, he has raised the concerns of local fishermen about wash emanating from ferries operating in the port, with fast conventional ferries often cited as the worst offenders.
The second contextual point is the long dependence of the local economy on the ferry industry. The report notes that ferry services started in the area in 1861 and that it is one of the oldest established routes across the Irish sea. It seems that there is local nervousness—understandable to a Member representing a constituency such as mine—about questioning the activities of such major and long-standing local employers, but to what extent has that engendered a dangerous local culture, where people feel unable to speak out on public safety issues?
It has been suggested that other accidents have been kept from the public gaze by out-of-court settlements. Indeed, only hours after the accident, when the family were at the hospital, confronted with media interest, they were advised by a local police officer, "Don't mention the ferries." Media coverage immediately after the accident included quotation of a local spokesman for the coastguard who attributed it to a "freak gust of wind." That theory was dismissed soon afterwards.
The third point of context came as a shock to me. Despite its long history as a ferry port, and the operation of heavy commercial traffic with high-speed craft, there is no statutory harbour authority regulating activity on Loch Ryan. It was unbelievable to discover that that could be the case in Britain in 2004. The fourth background point is that less than two months after the accident, a similar accident involving ferry wash in the loch led to sweeping recommendations, including the establishment of a statutory harbour authority.
I have four specific concerns about the report. The first relates to the circumstances of the accident. On page 41, the MAIB sets out its belief that the events that finally sank the boat
"unfolded between 16.39 and 16.44 … The MAIB does not know the source of the wave(s) that impacted on the boat at, or about, 16.42. The survivors strongly believe that the wave(s) had originated from the ferry … which had very recently passed them. However, the ferry had passed out of the loch by the time the waves reached the boat and, considering the position of the accident, obtained from VDR radar recordings, and the apparent direction of the wash waves, this theory is not supported by the evidence."
The report later claims that the waves that swamped the boat came from the starboard quarter and from a
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direction of about north-west, and provides the following explanation:
"Seacat Rapide, the Belfast to Troon fast ferry, passed 7 miles from Corsewell Point about 25 minutes before the accident. The MAIB has consulted experts for an opinion on whether wash waves from this vessel could have been significant in the position of the accident. The Branch was told that they would not have been. However, during an investigation into another incident the Branch asked … for members of the public to come forward with their experiences of wash from ferries in the Loch Ryan area. One response, from a reliable witness, included the information that over many years of observing the effects of wash in the area, he had noted, among other things, that the wash from the Belfast to Troon ferry could have a noticeable and significant effect on the shoreline … Despite the experts' view"—
I stress those words—
"the MAIB believe that this observer's evidence is compelling and the coincidence in the timing, and in the fact that waves from the Seacat Rapide would approach the loch from roughly the right direction, should not be ignored."
I find it surprising, to say the least, that the MAIB should promote the views of an unnamed member of the public, even if we are told that they are a "reliable witness", over those of experts and, perhaps more important, the vehement testimony of the survivors. The survivors dispute that version of events, stating that the wave that took the boat down came from the same direction as the one that, moments earlier, had swamped the boat, and they are adamant that it happened earlier in the afternoon—at 3 pm. Harry Houghton's watch stopped at that time when it was submerged in seawater.
The survivors dispute strongly the report's observation that
"a person's memory is fallible, especially when that person has been subjected to a very stressful situation".
In this case, I know the opposite to be true: the events that led to the sinking of the boat will be for ever etched on the minds of the survivors.
The dispute about the origin and direction of the waves that sank the boat brings me to my second area of concern: the fast conventional ferry, the Stena Caledonia, and its speed. Page 9 of the report notes:
"Some conventional ferries can develop sufficient speed in shallow water to move into the critical speed range and produce critical speed wash similar to that of an HSC"—
a high-speed craft.
On page 58, the MA1B states:
"In the area where the accident occurred, where the water is about 11 m, a vessel making 17.2 knots through the water is on the margin of the critical speed zone. In this case, the Stena Caledonia was making slightly less speed. Even so, she would have been producing large sub-critical wash waves such as those described by the survivors."
While its role in the accident is a matter of dispute, it would seem beyond doubt that the Stena Caledonia was travelling too fast for a boat leaving Loch Ryan, where other, smaller fishing boats had been spotted and where safety concerns are well known.
The report accepts that
"the greater knowledge and understanding of wash emanating from conventional ferries, gained by having a risk assessment passage plan (as required in Dublin) might have given the bridge officers a greater awareness of the effects of wash from their vessels on a small craft."

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It continues:
"The MAIB investigation has discovered an apparent lack of awareness among the conventional ferry crews about the hazards of wash effects. In the vicinity of small boats, there appears to be a lack of concern unless a collision or close-quarters situation in imminent. Interest in the boat appears to diminish once she is past the beam of the ferry. Both high speed and conventional ferries can produce significant wash which can endanger vulnerable craft after the vessel has passed."
Clearly, the MAIB was sufficiently concerned about the speed of the boat to include those words, but I am yet to be convinced that there is not clear evidence in the report to show that the boat was, in fact, travelling in the critical range.
Figure 2, which shows the Stena Caledonia's radar at 16.37, shows a speed-over-the-ground reading of 17.4 knots—well past the 17.2 knots critical speed range for a fast conventional ferry. I have checked that point with the MAIB and have been told that speed over the ground does not relate to the actual speed of the boat. It says that the boat was travelling at 17 knots or just under and that tidal pull led to the radar recording a greater speed over the ground. Although I understand that distinction, it nevertheless seems to take the boat into the critical speed range, with similar effects. I am yet to be convinced that there is clear evidence in the report to show that the boat was not travelling in the critical range while still in the loch, with small vessels close by.
Further questions arise. Is it proven that a speed over the ground of 17.4 knots would not produce critical wash? If so, should the captain of the ferry not have reduced speed, having taken into account the effects of the tidal pull? Was the boat accelerating when the reading was taken? If it was not producing critical wash at the time of the radar reading, when did it reach that critical speed? The 17.4 knots reading was taken when the ferry was level with the fishing boat. What was the weight of the boat? Would its weight have had an effect on the size of the wash produced? Is it true that the loch was dredged very soon after the accident, which might suggest that its shallowness was affecting wash size? Those questions need further investigation and I ask the Minister to consider commissioning that work.
Although the report dismisses the Stena Caledonia's role in the sinking of the boat, it nevertheless makes two recommendations—2004/163 and 2004/162—one of which alerts harbour authorities to the potential of fast conventional ferries to create similar wash to that produced by high-speed craft. The second recommendation asks operators to consider whether any of their boats has the potential to reach critical speeds and, if so, to produce an RAPP, so that crew are fully aware of the dangers. Those strong recommendations about fast conventional ferries seem at odds with the main body of the report, given that the role of the Stena Caledonia has been discounted.
I now turn to lookouts. The survivors and their family have always maintained their disbelief that seven ferries passed the upturned boat through the late afternoon and early evening—sometimes a matter of yards away, and the survivors have spoken of seeing people clearly moving inside the wheelhouses of those boats—yet not one of the lookouts was able to spot the bright life jackets and upturned hull. On that hull,
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Harry Houghton was at times waving at the boats, trying to grab the attention of those on them by waving a fluorescent buoy. Figures 8 to 11 in the report confirm the survivors' account that the boat passed very close by. It was a clear summer's day in Scotland. The survivors dispute whether the weather deteriorated in the way the report describes.
The report quotes the international convention on standards of training, certification and watchkeeping for seafarers, which states:
"A proper lookout shall be maintained at all times … and shall serve the purpose of: detecting ships or aircraft in distress, shipwrecked persons, wrecks, debris, and other hazards to safe navigation. The lookout must be able to give full attention to the keeping of a proper lookout and no other duties shall be undertaken or assigned which could interfere with that task."
On page 59, the MAIB seems to suggest that that was not the case in Loch Ryan. It states:
"Other ferries operate in the entrance to Loch Ryan with the bridge officer or the master performing the role"—
of lookout—
"The latter arrangement would be deemed to be compliant with the rules if the officer can devote his time solely to the task of lookout. However, it is doubtful that, with all the other requirements associated with either setting out on passage, or on arrival, the bridge officer or master can adequately perform the role in the confines of the entrance to Loch Ryan."
The MAIB also noted that two of the ferries had improperly set radars on that day. It concluded that there were "shortfalls" in the lookout arrangements, but seemed to explain them away by saying that it had received assurances that designated lookouts were posted on all ferries operating on that day and that conditions would have made it difficult to spot the boat. It is an undeniable fact that the submerged boat was showing on the radar, so, in my view, a fully engaged lookout would have spotted it. We need more detail on the precise shortfalls of the lookout arrangements. If the arrangements were not up to scratch, as the report says, we should know why, and know the effect that those deficiencies would have on the lookout's ability to spot the boat.
My fourth point is on survival times. The report goes into great detail about the search and rescue operation and the basic mistakes made. Belfast coastguard was below minimum staffing levels and Clyde coastguard was below recommended levels. Such understaffing, coupled with the inadequacy of the procedures, led to the failure to correct a simple mistake in the inputting of the co-ordinates of where the survivors were rescued from, so the rescue helicopter was sent to the wrong location. Furthermore, the inshore lifeboat that located the boat was tasked with towing it from the scene instead of giving first priority to the search for survivors. After taking everything into account, the MAIB concludes:
"It is therefore possible, in a best case scenario, that Shaun and Michael Ridley could have been recovered 47 minutes earlier had the correct position been given."
The MAIB asked Professor Mike Tipton, an expert in cold water immersion survival, what difference that would have made. His analysis was that it would, in all probability, have made no difference. However, the family will have to live with the terrible fact that they will never know for sure. Pauline Ridley points out that clinical staff at the hospital worked on Shaun and

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Michael for about two hours, clearly suggesting that they were not dead on arrival. Furthermore, she says that it is possible that Steven was still close by to Shaun at the earlier time when, if things had gone to plan, rescuers would have been on the scene. From all that, we know two facts: first, we will never know for sure whether a properly conducted rescue operation would have made a difference; and, secondly, the search and rescue operation was seriously defective.
The four areas that I have outlined cover issues of major dispute. At the same time as this report was published, the MAIB released another report into a more minor incident involving ferry wash in Loch Ryan on 3 September last year. It recommended that Dumfries and Galloway council should take the lead role in establishing a statutory harbour authority with responsibility for all of Loch Ryan. That major recommendation suggests that arrangements to date have been seriously deficient and have put public safety at risk. I cannot help but conclude that it was less controversial to attach such a major recommendation to a report into a more minor incident. The number of the report into the minor incident is No. 4/2004, while the report about which I have been talking is No. 5/2004. It is almost unbelievable that major commercial ferry operations have been run for years out of an unregulated British port with no harbour authority. It seems to me that the failure to create a statutory harbour authority has placed the public at risk. It would help to know from the MAIB the extent to which the report into the accident that I have described today influenced its decision to make major recommendations in its other report.
In conclusion, I make two requests. First, will the Minister consider the points that I have raised and commission a further investigation into them? Secondly, I ask the authorities in Scotland to order a fatal accident inquiry so that all the issues that I have mentioned can be thoroughly investigated.
Although the circumstances surrounding the tragedy are difficult to ascertain with absolute certainty, three things about that day are beyond doubt: wash from ferries affected the boat, lookouts had shortcomings and the search and rescue operation was seriously defective. One can only conclude that the lack of a permanent harbour authority contributed to that unsatisfactory state of affairs.
We are grateful to you, Mr. Deputy Speaker, and to Mr. Speaker, for granting this debate today so that I, on behalf of the family, can place the facts on record. Shaun Ridley would never have knowingly placed his family at risk, but, like the rest of the public, he could not have known just how dangerous the unregulated Loch Ryan was to small vessels.
3.44 pm
The Parliamentary Under-Secretary of State for Transport (Mr. David Jamieson): Terrible as this subject is, I congratulate my hon. Friend the Member for Leigh (Andy Burnham) on his handling of it and on securing this debate. He has helped the House by raising some important issues, and since the incident occurred, he has represented his constituents' interests tirelessly. On behalf of Her Majesty's Government, I convey my deepest sympathy to Mrs. Pauline Ridley, who lost her
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husband, Shaun, and her two sons, Steven, aged 15, and Michael, aged 12, in that terrible accident on Loch Ryan. I also offer my condolences to the two survivors—Mr. Brian Ridley, who lost his only son and two grandsons, and Mr. Harry Houghton, a family friend. There is no heavier burden that a parent has to bear than the loss of a child, especially those so young and in such tragic circumstances.
The marine accident investigation branch is an independent body that reports directly to the Secretary of State. Following a technical investigation into the circumstances and the causes of an accident, it makes recommendations based on its findings. The sole purpose of an investigation by the marine accident investigation branch is to make recommendations that will improve the safety of life at sea and help to prevent future accidents. It does not seek to attribute blame. To maintain its reputation, it relies on its investigations being fair, comprehensive and balanced. Indeed, it has a high reputation, not just in this country but internationally, and has been emulated by investigators in other countries. Since it was established in 1989, the marine accident investigation branch has inevitably gained a great deal of experience investigating a wide range of marine accidents. During the course of a single year, it typically conducts about 40 investigations.
In 2003 alone, the marine accident investigation branch investigated 27 deaths resulting from marine accidents. That was 27 too many, and in hindsight most of them were avoidable. Three of those deaths happened, as we have heard, on 12 July 2003, when Shaun Ridley's boat became swamped. Investigations are greatly assisted by eye witness accounts, but accident inspectors have to collect and analyse a large amount of evidence from many sources to compile a report that reflects the sequence of events as completely as possible. Six inspectors and a human-factors expert collectively spent many hundreds of hours collecting and analysing evidence before the final report was produced.
In conducting his investigation into the tragedy on Loch Ryan, the chief inspector appreciated the assistance and co-operation of Mr. Brian Ridley and Mr. Harry Houghton. I have been asked to comment on progress implementing the recommendations arising from the investigation, and I can report that recommendations to the Maritime and Coastguard Agency, the Royal National Lifeboat Institution and the ferry operators have all been accepted and implemented, or are due to be implemented this summer. Following recommendations, the Maritime and Coastguard Agency has conducted a review of similar but less severe marine accidents, and is improving links and the exchange of information with the National Federation of Sea Anglers by establishing a sea angling liaison officer.
The Maritime and Coastguard Agency is writing to all United Kingdom port authorities to highlight the potential danger to small craft from the wakes of both conventional and high speed ferries. It has also reviewed and revised its incident management course to concentrate more specifically on the watch manager's role as the search and rescue mission co-ordinator. It has changed its training courses to reinforce communication protocols.

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I shall deal with some of the criticisms that have been made about the particular investigation, beginning with the location and timing of the incident. Establishing the precise location and time of an accident at sea can be a difficult task, even though that is fundamental to an investigation. In this case, in addition to the information provided by the survivors, the marine accident investigation branch was able to analyse information taken from the voyage data recorders—the VDRs—provided by Stena Line Ltd. and P&O Irish Sea, which operated vessels through Loch Ryan on the day of the accident. The ferries that operate to and from Loch Ryan all have VDRs fitted.
VDRs record certain key information, including conversations that take place on the bridge and radar information, which allows the marine accident investigation branch to recreate a picture of vessel movements. Such devices can tell us a great deal about when and where an accident occurred.
On its outbound voyage the Stena Caledonia passed the Ridley's boat at 16.38 hours and the Superstar Express passed it inbound at 16.45. The officer on watch on the Stena Caledonia saw a boat and commented on its presence to his helmsman. The officer was later shown Shaun Ridley's boat and was able to confirm that it was the boat that he had seen. The radar recordings from both ferries show the position and relative movement of the Ridleys' boat between 16.32 and 16.46. The recordings show the point in time when the Ridleys' boat became static after it had been swamped and its engine had cut out.
The marine accident investigation branch supplemented its information about the location of the boat close to the time of the accident by a visual sighting made by the crew of a passing fishing vessel at about 16.41. Given the degree of confidence that the marine accident investigation branch places in the radar information, it is completely satisfied that the location of the accident was as stated in its report.
Questions have been raised about the cause of the accident and, in particular, about the role played by the wash of an outbound ferry. In constructing the probable accident scenario, the marine accident investigation branch took account of the evidence provided by the survivors. The inspectors also considered other relevant evidence, including the VDR data, meteorological data, evidence from inspection of the hull—which showed that it had a leak—and the sea trials, which indicated that the boat was vulnerable to swamping from waves approaching from the stern.
In its report the marine accident investigation branch acknowledges that some of the evidence is conflicting. However, it regards the VDR evidence as being compelling, and it is confident that in its published report it has accurately reconstructed the events in the final few minutes before the boat sank.
It is not disputed that the ferry Stena Caledonia was passing through Loch Ryan on an outbound voyage at about the time of the accident. The marine accident investigation branch has the data from its voyage data recorder and the radar image that shows the position of Mr. Ridley's boat between 16.32 and 16.38. At that time the Stena Caledonia was making 17.4 knots over the
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ground as it passed about 600 m from the Ridleys' boat. Given the tidal conditions at the time, the speed of the ferry through the water would have been about 16.8 knots, which is just below the speed that is needed to generate a critical wash, taking proper account of the depth of the water.
A passing distance of 600 m is not considered close, and the marine accident investigation branch is fully convinced that on the basis of the evidence, including the survivors' accounts, the boat successfully rode the wash waves from Stena Caledonia at about 16.38. However, the branch cannot be certain of the source of the waves that came over the starboard quarter of the boat at, or about, 16.42 causing the boat to be swamped and to sink within just a couple of minutes. The branch concluded that the waves could not have come from either the Stena Caledonia or the Superstar Express, which had yet to enter the loch on her inbound voyage.
The marine accident investigation branch believes that there is a possibility—I put it no higher than that—that there could have been wash waves from the Seacat Rapide, the high-speed ferry operating on the route from Belfast to Troon, which passed nine or 10 miles away some 25 minutes before the accident. At a speed of 35 knots, the branch says that she would have been operating within the terms of her risk assessment passage plan, but still fast enough to produce the powerful sub-critical waves that my hon. Friend mentioned, which might have contributed to the swamping of the heavily loaded and, by then, partially flooded boat. The branch holds that wash propagation from high-speed ferries is not yet fully understood. Although other experts may disagree, the branch gives credence to the evidence of a witness, who has observed the wash effects from such ferries in and around Loch Ryan over many years, because of his scientific background and his comprehensive description of the phenomena he had observed. I accept my hon. Friend's point that we do not avant to give overdue credence to that witness, but we certainly cannot rule out the careful examination of such evidence in future.
The marine accident investigation branch reports on the sad and regrettable fact that no one on board the three ferries, which passed the survivors a total of seven times, saw the problem. Those ferries were passing somewhere between 400 m and 800 m away from the casualties, and each ferry had a dedicated lookout as well as collectively several hundred passengers on board. Those on board other smaller and slower vessels also failed to see the people in the water. However, taking account of the prevailing choppy sea conditions and the blue and white colours of the bow of the boat, which was the only part of the boat remaining above the surface, the branch considers that it would have been difficult to spot. Furthermore, despite having inflated two life jackets, the casualties would have been difficult to see in the water. The fact that the problem was not spotted is a matter of concern to the branch; that is why its report contains a recommendation addressing that aspect of the tragedy.
There has been some criticism of the search and rescue mission, which began some four hours after the accident when a yacht saw the bow of the boat and rescued the two survivors who were clinging on to it. Shaun and the boys, who were wearing life jackets, had drifted away under the influence of the wind.

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The United Kingdom is rightly very proud of its maritime search and rescue services. The Maritime and Coastguard Agency handles more than 12,000 incidents annually and renders assistance in more than half those incidents, with the result that some 5,000 people are rescued each year. It is very rare for a mistake to be made. Of course, any error occurring in a search and rescue mission is a matter of regret, but the most important thing is to learn from such errors when they occur. In this case, the marine accident investigation branch discovered that a typing error was made when inputting the position of the casualty that was not noticed during the normal double checks on such information.
The effect was to cause the helicopter to go in the wrong direction even though it had been given the right location when it took off. However, I believe that my hon. Friend accepts that, even if it had gone directly to the reported position of the boat, there is no guarantee that the survivors or bodies would have been spotted immediately, especially as the helicopter is not fitted with forward-looking, infrared equipment.
When the survivors were rescued, Shaun and the boys had been drifting away from the boat for several hours, so their location was uncertain. In an ideal world, the helicopter would have flown directly to where Shaun and Michael Ridley had drifted, spotted them immediately and recovered them. Only in those fortuitous circumstances would they have been recovered 47 minutes earlier.
Indeed, although it is impossible to be certain, expert opinion is that it is unlikely that casualties immersed in those waters and at those temperatures would have survived to the point in time when they might have been rescued.
Although it did not alter the outcome, the vital necessity to undertake double checks on the accuracy of crucial information such as the initial position has been reinforced in all Maritime and Coastguard Agency co-ordination centres and with the rescue units that it co-ordinates. We shall monitor that closely to ensure that that happens. The need for control and planning of radio communications by the Maritime and Coastguard Agency marine rescue co-ordination centres and for radio discipline is being underlined to all MCA operators.
The investigation into the tragedy has been thorough and independent. No assurance about an investigation can be given to the bereaved or to the survivors except that it will be rigorous and without favour. The chief
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inspector of marine accidents is satisfied that the report into the tragedy is fair. When the recommendations are implemented, safety of life at sea will be improved.
I have already reported that the recommendations are being implemented. I can add that, already this summer, coastguard officers are being proactive in visiting caravan sites such as that near where the Ridleys were staying. The purpose of the visits is to increase safety awareness among the casual, recreational seafarers and to stress the importance of being properly equipped and prepared.
A fatal accident inquiry may yet be held, but that is a matter for the Procurator Fiscal and the Crown Office in Scotland. It is not a matter that I, as a Minister, can decide. The decision is a matter for the judiciary in Scotland. I am told that such an inquiry would resemble a public inquiry. It would examine all the issues that my hon. Friend would want to be considered. However, I stress again that the decision is a matter for the judiciary in Scotland. Unfortunately, I have no remit to direct them to make such an inspection.
Pending the decision on whether there will be a fatal accident inquiry in Scotland, it would be premature of me to comment on the need or otherwise for that form of public inquiry. However, if such an accident inquiry does not take place in Scotland, I shall review the request for further examination of the issues that my hon. Friend has raised.
This has been an appalling tragedy and, having had a similar one involving some of my own constituents on the south coast 10 years ago, I know that it will bear down heavily on the parents and all those involved. I congratulate my hon. Friend again on the way in which he has tirelessly represented his constituents, not only in the Chamber, but in his correspondence to the Department and his interaction with the marine accident investigation branch. This has been a matter of great sensitivity for him and, of course, for the families and all those who have been affected by this tragedy.
It is most important that we learn from tragic events. Because human beings are as they are, we will never be able to prevent every such incident from happening, but we must learn from these events and reduce the probability of there being casualties in the future, particularly among children and young people. Again, I congratulate my hon. Friend on securing this debate. I am sure that there will be more to say on this issue, and he can be assured that my Department will do everything that it can to facilitate the answers to the questions that his constituents have raised.
Question put and agreed to.
Adjourned accordingly at five minutes past Four o'clock.