Lords Sitting of 6 April 1982

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Portsmouth.

The Palestinian Problem
Lord Mayhew: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what action they are now taking to promote a just and peaceful settlement of the Palestinian problem.
The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Lord Trefgarne): My Lords, we remain committed to the principles of the Venice Declaration, which calls for the acceptance of the right of the Palestinian people to self-determination and Israel's right to live in peace and security. We are continuing to keep in contact with all the parties concerned.
Lord Mayhew: My Lords, is the Minister aware that his Answer will give great reassurance? Would he agree that in recent years, no one has worked more patiently and positively for a settlement in Palestine than the noble Lord, Lord Carrington? The Minister's statement indicating a continuity of policy will be warmly welcomed.
Lord Trefgarne: My Lords, I am grateful to the noble Lord for his kind words, and I am certain that my right honourable friend the new Secretary of State for Foreign Affairs will also be reassured by them.
Baroness Gaitskell: My Lords, despite what the Minister said and while I, like many Israelis, have grave reservations about what is happening on the West Bank, may I inform the noble Lord that I have recently read again the covenant of the PLO, from which I quote three sentences which tell us what they feel? Would the Minister agree that when the PLO say:
"Peace for us means the destruction of Israel",
and,
"The destruction of Israel is the goal of our struggle",
and,
"We are the sole legitimate representatives through the mouth of the gun",
those are not words to make peace in the Middle East?
Lord Trefgarne: My Lords, I certainly agree that some of the things the PLO have said, and some of the things they say they stand for, are not likely to contribute to a settlement in the Middle East. But the
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fact remains that they represent an important segment of Palestinian opinion and it therefore seems inconceivable that a settlement in that area could be reached without taking their views into account.
Lord Chelwood: My Lords, arising out of that last supplementary question, may I ask if my noble friend recollects that Mr. Begin has said on a number of occasions that the PLO will disappear? Should Mr. Begin and his Foreign Minister not be reminded, as former chiefs of the Irgun Zvei Leumi and the Stern Gang, that they disappeared only after the Jews had obtained what they had longed for, a national home in Palestine as a result of the partition of that country? Is it not asking far too much that the PLO should disappear until such time as the Palestinian people again have the right to have their own home in their own country, at least up to the pre-1967 armistice lines?
Lord Trefgarne: My Lords, my noble friend and the noble Baroness, Lady Gaitskell, put their fingers in their different ways on the essence of the problem in the Middle East, and I do not think it would be appropriate for me at Question Time to expand on what they said.
Lord Glenamara: My Lords, will the Minister bear in mind that the PLO, which the noble Lord on the Liberal Benches has supported for the past 25 years, is an international terrorist organisation which has sworn in statements, up to the present time and over the years, to the destruction of Israel—the only democratic state in the Middle East—by force of arms? In view of our experience in recent days in another part of the world with another country which is trying to get its way by force of arms, may I ask the Government to be very wary indeed before having anything to do with the PLO?
Lord Trefgarne: My Lords, I fear I cannot go further than I have, both today and on other occasions, from this Box, when I say for all their failings, and failings they indeed have, the PLO represent an important segment of Palestinian opinion and their views must be taken into account when we get nearer to a settlement than we are at the present time. But, as I said, some of the things the PLO have said, some of the things they have done and some of the things they stand for, are clearly not compatible with a settlement anywhere.
Lord Byers: My Lords, will the Minister recognise on behalf of the Government that the PLO is nothing but a terrorist organisation?
Lord Trefgarne: The PLO is actually an umbrella organisation, my Lords, and a large number of subsidiary organisations are affiliated to it. It is certainly the case that some of those affiliated organisations have, in accordance with their own admissions, been responsible for some appalling acts of terrorism.
The Earl of Onslow: My Lords, is it not true that the Israeli Government are annexing the Golan Heights and are kicking people and settlers out of the West

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Bank in a way which is very similar to that of the Argentine Junta in the Falkland Islands?
Lord Trefgarne: It would probably not be helpful to draw parallels between the two, my Lords, but it is certainly the case that recent acts by the Israeli Government have caused the greatest anxiety among some of their western friends, not least the Government of the United Kingdom, and I certainly include among those acts what has happened recently on the West Bank and Golan Heights.
Lord Paget of Northampton: My Lords, since for the time being our search for a peaceful and just settlement looks to be directed elsewhere, would not we be well advised, rather than to seek to advise the Israelis, to ask them if they would come and advise us on how we should protect our own territory where it is threatened? They have proved rather better at it than we have.
Lord Trefgarne: My Lords, I wish to reassure the noble Lord that Her Majesty's Government are determined, and have no doubts, as to the validity of our position with regard to the Falklands, to which I presume the noble Lord is referring, and we shall certainly restore that country to our own control in due course.
Lord Morris: My Lords, is my noble friend aware that the very language that he used—namely, the PLO" for all their faults"—is precisely the same language as the Government of the day used when referring to Germany between 1933 and 1939?
Lord Trefgarne: My Lords, I was not responsible for what was said between 1933 and 1939, but I think that the position with regard to the Middle East is certainly different from the position with regard to the various countries and events to which my noble friend refers. We think that a settlement in the Middle East will be achieved only by means of a consensus, and not by the use of force.
Lord Wells-Pestell: My Lords, will the noble Lord agree that there can be no meaningful discussions with the PLO regarding peace in the Middle East until the PLO recognise the existence of Israel, its right to exist, its right to independence, and its right to be able to exist as a state?
Lord Trefgarne: My Lords, I certainly agree that the PLO will have to change their position on a number of matters before a settlement can be agreed, but it will also be important for the Israelis to have a dialogue with the PLO to achieve that change.
Lord Mayhew: My Lords, is it not perfectly plain that on both sides there are strong elements whose views are quite incompatible with a peaceful and just settlement? Is it not quite plain that the literal interpretation of the PLO charter and the literal interpretation of resolutions of the Knesset and declarations
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from the Prime Minister of Israel would make a peaceful settlement entirely impossible?
Lord Trefgarne: My Lords, I am afraid that the only deduction that could properly be drawn from what the noble Lord says would be that the only possibility of achieving a settlement in the Middle East would be by some force of arms, and the Government do not accept that position.
The Chancellor of the Duchy of Lancaster (Baroness Young): My Lords, I think that the noble Lord, Lord Brockway, has been trying to get in for a very long time. May I suggest to the House that we take his supplementary question, and then move on to the next Question.
Lord Brockway: My Lords, may I ask the noble Lord whether he will suggest to the Foreign Secretary that, when he is free from his present heavy responsibilities, he considers preparing a renewed United Nations international conference on this subject?—in view of the breakdown of the Camp David agreement, the unrest not only on the West Bank but in Israel itself, and the hopeful proposals that are made by Saudi Arabia.
Lord Trefgarne: My Lords, the proposal which the noble Lord puts forward is one which has in fact been put forward by the Soviet Union in recent months. That is not to say that we dismiss the proposal because of that, but any such conference would certainly need to be very well prepared if it were to make any progress in the present circumstances. As to the proposals of Saudi Arabia, they are certainly important proposals, which indeed have a good deal in common with the Venice Declaration of the European Community last year, and certainly together with that declaration they might form the basis for further progress.

University Teachers' Pensions and War Service
2.47 p.m.
Baroness Wootton of Abinger: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they are satisfied with the allowances for years of war service, as at present included in the calculation of the retirement pensions of university teachers.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Elton): My Lords, for those university teachers whose careers were interrupted by the war, or who entered university teaching within 12 months of demobilisation, their war service counts in full for pension purposes. For others who became teachers after service in the armed forces of the Crown, and before 30th June 1950, their war service counts at half-rate. Her Majesty's Government are satisfied that the war service of university teachers

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ought to be recognised for pension purposes on terms broadly comparable with those for all other public servants; and that is the present position.
Baroness Wootton of Abinger: My Lords, I thank the Minister for his Answer, and I wonder whether he will allow me to ask him two further questions. Is he really satisfied regarding the deprivation that is now suffered by senior academic personnel who at the beginning of the war were preparing for academic posts, threw up everything to join the forces, served throughout the war, and often suffered delayed demobilisation, with the result that they could not comply with the requirement that they should obtain a new academic post by June 1950? Secondly, is he aware of the extraordinary anomalies that are arising under the administration of the present rules? For instance, when a conscientious objector registered, he was directed to alternative service and received full credit for his years in that service, while a senior professor, who was a Fellow of the Royal Society, served for four years as a volunteer in the Navy, and, through being four months too late in obtaining an academic appointment, received nothing.
Is the noble Lord aware of an even more extraordinary example? We have on record a case concerning a person, now a British citizen by naturalisation, who was a citizen of an enemy country during the war and was engaged in armaments research in that country. He has been credited with those years of service, while a university teacher in this country—
Several noble Lords: Speech!
Baroness Wootton of Abinger: My Lords, I am merely asking whether the Minister is aware of this. This is the last example that I should like the Minister to note. Is the Minister aware that the case to which I have just referred is contrasted with the case of someone in this country who was in university employment, was drafted to the Ministry of Supply to do research on armaments, and receives no credit at all?
Lord Elton: My Lords, by way of preface to my reply I ought to explain that the provision in the scheme was intended by Parliament to apply to those people whose chosen career was either interrupted or deferred involuntarily by service in the armed forces of the Crown during the Second World War. A chosen career can be identified only when a person becomes committed to it, and the first hard evidence of such commitment is normally the first job in it. However, there are occasions when the preparation for a career can be directed only to that career and commitment to a career starts with a preparation for it. But you cannot say that of a university teaching career because there is no training which is specific to the career of being a teacher in a university and which cannot be otherwise employed.
The noble Baroness cited a series of cases which have been raised outside this Chamber. It is not proper for me to reply to individual cases, but I can say that university teachers are in the same position as members of other public service pension schemes. No conscientious objector can receive the half-rate war service credit as a post-war entrant to university teaching
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because he has not been in the armed forces. The conscientious objector in question would either have been in university teaching before the war or would have entered such teaching immediately afterwards on the basis of qualifications obtained during the war. He would thus have had his career interrupted or deferred. In such circumstances he would receive a full war service credit only if he had been directed to work of national importance contributing to the war effort.
To pick only one other of the noble Baroness's illustrations, I know, and the department knows, of no evidence that any enemy armaments worker, as she termed it, is in receipt of this pension, and cannot conceive how that could be. We have searched for evidence, and if the noble Baroness has it I should like to see it. Otherwise, I shall treat the case as apocryphal.
Lord Mackie of Benshie: My Lords, does the noble Lord not negate his own argument by allowing half-service for war years pre-training entry? Surely, if you do that the noble Baroness's argument applies. They did not waste but lost those very valuable years just as much as people who interrupted their university teaching.
Lord Elton: My Lords, as I said in my original Answer, the scheme is intended to be on all fours with schemes for other people serving in the public service. That condition applies to them, and was extended to the university teachers last year.
Lord Ashby: My Lords, is the noble Lord aware that this cut-off date of 1st July threatened also the opportunities for some school teachers to receive the benefits of their war service? Is he further aware that in order to meet that circumstance in 1975 the cut-off date for those who were intending to become schoolteachers but who were not yet in jobs because they do not begin until September, was changed to the 30th September? Would the noble Lord agree that an advance of no more than 24 hours in that cut-off date to the 1st October 1950 will go a long way towards resolving this disgraceful lack of appreciation of the war service done by a good many university teachers?
Lord Elton: My Lords, the distinction between the training of a teacher who takes a certificate of education, as it was, or a diploma of education and a teacher in a university is that the certificate or diploma is of use to him only in teaching, and he has therefore been committed to a career in teaching from the beginning of his training. A university teacher with a university degree can apply it in a whole spectrum of other employments. That is why there is that distinction. As to the question of moving the date by 24 hours, that is an interesting proposition which I shall look at.
Lord Ashby: My Lords, I hope that in doing this the noble Lord will also bear in mind, if I may ask him to do so, the fact that not everybody who takes a course in teacher training becomes a teacher, just as not everybody who gets a higher degree becomes a university teacher.
Lord Elton: Indeed, my Lords, but a certificate or diploma of the ability to teach is not as widely useful

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in seeking employment as a degree of bachelor or master of the arts, for instance.
Baroness David: My Lords, would the Minister not agree, though, that there is discrimination? There are other professions which have advantages that universitity teachers do not have. Under local government and the National Health Service superannuation schemes, staffs still in training for those services at the 30th June and subsequently entering the appropriate service were eligible for concessionary war service arrangements towards pensionable service. Why is there not a similar arrangement for university teachers?
Lord Elton: My Lords, the same applies to them as applies to teachers. In local government it is a qualification for this exemption for public health inspectors to have taken training for the Royal Sanitary Institute Diploma. It is to those, I presume, that the noble Baroness refers. Similarly, in the National Health Service specialist training courses for qualification in medicine and dentistry, including courses for professions supplementary to medicine, clearly qualify people to pursue only those professions.
Baroness Wootton of Abinger: My Lords, may I ask the Minister whether he would look into similar provisions that are made in a number of friendly countries in the EEC, which I think he will find are a great deal more liberal?
Lord Elton: My Lords, I am not answerable for what happens abroad but I am interested in what the noble Baroness says.
Lord Balogh: My Lords, does the Minister realise that the repudiation of tenure introduces into our universities a totalitarian scheme which ought to be resisted?
Lord Elton: My Lords, I much regret that I could not get the drift of the question that the noble Lord was asking me.

Air Safety
2.57 p.m.
Lord Whaddon: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what proposals they have for improving the safety of passenger aircraft.
Lord Trefgarne: My Lords, the statutory responsibility for air safety lies with the Civil Aviation Authority. The authority keeps under review the requirements governing the design and construction of passenger aircraft and the standards to which they are operated. This is a continuing process involving discussion with a wide cross-section of the aviation industry, including
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research organisations and other airworthiness authorities.
Lord Whaddon: My Lords, is the noble Lord aware of the report on cabin safety in large transport aircraft recently issued by the United States National Transportation and Safety Board? Is he aware that in that survey of survivable crashes of passenger aircraft there was a most lamentable failure of cabin fittings, some 60 per cent. of these crashes showing serious failures—50 per cent. showing seat or seat belt failures, some 45 per cent. showing overhead racks coming down and some 35 per cent. showing galley equipment crashing all over the place? Is he aware that some 40 per cent. of the passengers involved became casualties? Will the Government consult with the United States authorities on the necessity to tighten up these regulations and reduce the hazards?
Lord Trefgarne: My Lords, I certainly agree that the report to which the noble Lord refers provided some interesting food for thought in these matters, but it is perhaps worth saying that the problems are not as simple as some of the commentaries on that report made out. I particularly noticed the article in the Observer on the 14th March, I think it was, which perhaps drew the attention of the noble Lord to the report in the first place. For example, if you strengthen an aircraft seat in the way that some people would have us do, then you almost certainly ensure that the accident is not survivable so far as the passenger is concerned because it is his spine which takes the shock rather than the collapsing seat.
Earl Grey: My Lords, is the noble Lord aware that decisions that some of these measures be incorporated in regard to safety were taken 30 years ago, and is it not about time that these measures were up-dated?
Lord Trefgarne: My Lords, the noble Earl is wholly mistaken in that view, if I may say so. For the record, the Civil Aviation Authority has introduced 23 amendments to its airworthiness requirements in the past 12 months, which have been aimed at improving the safety of civil transport aircraft. It has planned a further 47 amendments, which it hopes to introduce during the next few years. It has also issued nine airworthiness notices during the last 12 months dealing with the raising of safety standards.
Lord Glenarthur: My Lords, does my noble friend not agree that the use of flight simulators has contributed significantly to our flight safety over recent years? Does he not agree that the United Kingdom has been pre-eminent in the development of flight simulation? Can he say whether the Government will continue to give every encouragement to the further development of flight simulators, not only for flight safety but in development flying?
Lord Trefgarne: My Lords, I certainly agree with my noble friend in that matter, and I can certainly give him the assurance for which he asks. There is none better than he, if I may say so, to comment on these things.

Racial Discrimination: Professional Partnerships
3 p.m.
Baroness Sharples: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will introduce legislation to ensure that advertisements for a partner (in particular by doctors and dentists) will not be treated as discriminatory under the Race Relations Act 1976 simply because they seek applicants with particular religious beliefs.
The Parliamentary Under-Secretary of State, Home Office (Lord Belstead): My Lords, the Government have no present plans to amend the Race Relations Act 1976. Discrimination on the grounds of religious belief is not unlawful in Great Britain, unless it constitutes indirect racial discrimination under the Race Relations Act. Even then, an advertisement imposing a requirement that prospective partners in, for example, a medical partnership must belong to a particular religious faith may not be unlawful if that requirement can be justified.
Baroness Sharples: My Lords, while thanking my noble friend for that reply, which will be of help to those who have inserted these advertisements and who are disturbed at having been reported to the Race Relations Board, could my noble friend say how partnerships are affected by the Race Relations Act in matters other than advertising?
Lord Belstead: My Lords, I should like to make it clear that partnerships of less than six partners generally do not come within the scope of the Race Relations Act 1976. The advertising provisions, however, apply as far as indirect discrimination is concerned.
Lord Molloy: My Lords, is the noble Lord aware that in the history of this country we have never bothered too much about religion intervening in the practice of medicine and that I believe we ought to keep it that way? Is the noble Lord further aware that, nevertheless, there might be a need in some parts of the country to advertise for a specialised knowledge of a certain language and that should be helped in preference to any religious form of discrimination or acceptance only because of what a doctor might practise as his religion?
Lord Belstead: My Lords, I will take account of what the noble Lord has said about the need in some cases for a specified knowledge of a particular language. So far as religions are concerned, I think the noble Lord would accept that there has been a very long history of the close relationship between Christianity and the practice of medicine.
Lord Campbell of Alloway: My Lords, would my noble friend agree that in this instance the Act gives rise to a curious and unwelcome consequence; for although under Section 10 it is a firm of less than six partners—that is, a firm where the partners, say,
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hold the same religious beliefs—that cannot commit unlawful discrimination if they advertise for another partner of the same religious belief, they are liable to commit the offence of unlawful advertising under Section 29? Would my noble friend not agree that this is a slightly unsatisfactory and anomalous situation?
Lord Belstead: My Lords, I think my noble friend puts his finger on a point which is more apparent than real. My noble friend might agree that it is sensible under Section 10 of the 1976 Act to except the smaller partnerships from the scope generally of the 1976 Act. But the advertising provisions of the Act in Section 29 apply to all partnerships of whatever size, on the ground that a partnership, large or small, ought not to be free to publicise feelings which would be contrary to the intentions of the Act.
Lord Morris: My Lords, would my noble friend consider asking Her Majesty's Government to promote a religious discrimination Act which, with the Sex Discrimination Act and the Racial Discrimination Act, could be consolidated so that there is only one statute to ignore rather than three?
Lord Belstead: No. my Lords,

Business: Civil Aviation Bill [H.L.]
Lord Denham: My Lords, noble Lords will see that the Committee stage of the Civil Aviation Bill, which is a consolidation Bill, is on today's Order Paper in the name of my noble and learned friend the Lord Chancellor. No amendments have been tabled to the Bill and in the normal way a Motion to discharge the Committee stage should have been tabled. I apologise to the House for there being no such Motion on the Order Paper, but, if your Lordships will agree, my noble and learned friend does not propose moving his Motion today but will do so tomorrow instead.

Iron and Steel Bill [H.L.]
The Lord Chancellor (Lord Hailsham of Saint Marylebone): My Lords, I beg to introduce a Bill to consolidate certain enactments relating to the British Steel Corporation and the Iron and Steel industry. I beg to move that the Bill be now read a first time.
Moved accordingly, and, on Question, Bill read a first time, and to be printed.

John Francis Dare and Gillian Loder Dare (Marriage Enabling) Bill [H.L.]
Read a third time, and passed, and sent to the Commons.
Hugh Small and Norma Small (Marriage Enabling) Bill [H.L.]
Read a third time, and passed, and sent to the Commons.

Social Security and Housing Benefits Bill
Lord Elton: My Lords, I beg to move that this Bill be now read a second time. The Bill which I bring before your Lordships today is rather more than the routine document which social security measures are apt to be. It contains two important and beneficial social reforms. The first affects payments to people who fall sick, and whose sickness prevents them from working. The second affects the way in which we give help to those people who need it in order to meet the cost of their housing.
The Bill may be different from other social security legislation by reason of the effects which it has upon practices to which we have long been accustomed. In another important respect, however, it resembles other social security legislation rather closely. In parts, it is, unavoidably, rather a complex document. I am therefore arranging for notes on clauses to be available to your Lordships in the Printed Paper Office and for those to include a note describing the way in which it is intended that the power to make regulations shall be used in respect of both the statutory sick pay and the housing benefit schemes. I am also arranging for a note on the financial effects of statutory sick pay to be made available in the same way at the same time. I hope that these will be of use to your Lordships.
The principal change which we propose to the delivery to the recipient of payments during sickness has a history going right back to 1948. It was the intention, even under the Beveridge scheme, that sickness benefits should rank for taxation. It was rapidly discovered, however, that the administrative difficulties of doing so were insuperably complex and it was taken out of taxation. However, the idea was not dropped. It was not merely that to have one sort of income taxed and another untaxed was an untidy anomaly; it was also a matter of the effects which this anomaly had in individual cases and particularly where employers had (as increasingly they have) their own schemes of sick pay running alongside that provided by the state.
One important effect of this was that the gap between the value of income received while sick and that which was earned at work was reduced. In some cases, it was reduced to a point where the incentive to return to work became marginal. In an increasing number of cases where the employer gives full pay to employees who go sick, or full pay less national insurance benefit, employees actually get more when sick than when they are working. As early as 1974, this applied to no fewer than 66 per cent. of all full-time employees, so that we have what I might call an ailment trap built into the system. The attraction of living on an income that is both unearned and untaxed is, to say the least of it, considerable.
The extent to which employers provide their own sick pay schemes alongside those of the state is now very considerable. Almost 90 per cent. of all full-time employees are covered by such schemes. The disadvantage of this does not consist only of the obvious anomaly that for a lot of people it is more profitable to be off work sick than to be at work earning. At present when any one of those people falls sick two quite separate bureaucracies spring into simultaneous and parallel action: the employer and the state both have to
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record the fact of his sickness. Both have to assess his eligibility for sickness payments. Both have to calculate the amount due. Both have to make payments. Both have to record his return to work.
The virtue of the change proposed in this Bill is that for the first eight weeks of sickness it disposes simultaneously of both the ailment trap and the duplicated clerical work. Statutory sick pay will be paid by the employer through the normal PAYE system, thus both bringing it into tax and cutting the workload of the Civil Service, enabling us to reduce its size by around 3,000. This reduction will be an important contribution to the overall reduction of our national bureaucracy to a level appropriate to our needs. There will also be a net financial gain to public funds of up to £90 million.
The idea of statutory sick pay is not something which has been sprung upon the public without warning nor is it something which has been adopted by the Government without consultation. We published a Green Paper in 1980: Income During Initial Sickness: A New Strategy. In June 1981 we published a second consultative document called Compensating Employers for Statutory Sick Pay. As a result of this consultation we made a number of changes to our original proposals and, as your Lordships will know full well, a number more were made as the Bill now before the House made its way through another place. In this lengthy process we have taken on board the views of both employers' and employees' representatives, and the Bill we now have before us contains the wisdom distilled from two years of careful consultation, reflection and debate.
For those of your Lordships opposite who may, none the less, have a few lingering doubts or suspicions about the measure, I have one final word of comfort. It was a Labour Government which argued the case for statutory sick pay in its White Paper on social insurance of 1969 and concluded that,
"the Government will later explore the possibility of introducing a statutory scheme which would provide a minimum of sick pay for all employees".
We shall, of course, be dealing with the technicalities of what is proposed in some detail during the Committee stage and I think your Lordships will therefore wish me to deal with the provisions of individual clauses only briefly. They are as follows: The first four clauses—together with Schedule 1—explain when an employee is entitled to receive statutory sick pay and when an employer is liable to pay it. I shall here deal with only one point which I know has caused some concern, namely, the linking rule for statutory sick pay.
Under the existing national insurance scheme, the linking period is eight weeks, and we have no intention of changing that. In essence, the rule means that two spells of sickness separated by eight weeks or less are treated as one. This means, in turn, that the individual does not need to serve waiting days on the second spell. The purpose of this rule is to protect the position of someone who has a relapse, perhaps because he returned to work too soon, and is in effect suffering from no more than an extension of his original indisposition. That is how it works with sickness benefit under the national insurance scheme and there is no intention to

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change that. Under the statutory sick pay scheme there will also be a linking period, but it will be shorter.
The linking period between two spells will be two weeks. There are two reasons for that. First, it will make administration much simpler for employers. Secondly, statutory sick pay is designed principally to make payments during short illnesses. The long-term sick, for whom a longer linking period is desirable, will be the state's responsibility. Statutory sick pay will, in general, cover minor ailments—colds, 'flu, strains et cetera—for which a two week linking period seems more appropriate. We accept, however, that the linking period is a matter of judgment and we shall be keeping a close watch on its effect when the scheme is introduced. My honourable friend the Parliamentary Secretary for Health and Social Security has undertaken that we will be monitoring the effect.
Clauses 7 and 8 deal with the rates of statutory sick pay and various other provisions relating to payment. Clause 7 establishes the three rates at which statutory sick pay is to be paid. The rate to be paid depends upon the amount of the employee's normal weekly earnings. The top rate is set, initially, at £37. That is for those normally earning at least £60 a week. The bottom rate is to be £25 per week. That is for those normally earning less than £45. The middle rate was introduced as an amendment in another place. It covers those earning from £45 to £60 per week and amounts to £31. That change, made in another place, will give some 1 million employees an extra £6 per week in statutory sick pay. The result is, I think, a reasonable rate at each level, though it can of course be varied by order in the years to come. Your Lordships will know that the method by which employers were to recover their expenditure on statutory sick pay was a matter of considerable concern and some initial controversy. The Government have, however, taken great care to get the views of those concerned and to meet them. It became quite clear that the overwhelming preference of employers, both large and small, was for recovery by deduction from their monthly national insurance contributions. This is what the Bill provides.
Clauses 11 to 18 set out the administrative provisions and the rights of employees and employers. Essentially, they provide that where there is doubt about title to statutory sick pay, the national insurance adjudicating authorities can determine the question. I should also mention Clause 23 which, your Lordships will know, caused some controversy when the Bill was discussed in another place. It creates a liability for national insurance contributions to be paid on statutory sick pay. There have been objections that this is placing a financial burden on those businesses with no existing sick pay provision, which will be slightly out of pocket because of this provision. I have some sympathy with the argument but we can see no easy way round the problem. The solution put forward in another place—that employers (but not employees) should be exempted from paying contributions on statutory sick pay—would have been an administrative nightmare for both employers and the state. That I am glad to say was recognised by industry.
The effect of Clause 23 is mainly on small businesses, and your Lordships will know that this Government
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have done a great deal to help small businesses—not least the measures announced by the Chancellor in the Budget. These measures are selective, whereas the solutions put forward to get round the Clause 23 problem would have been indiscriminate. They would in fact have given most help to large firms, most of whom are already gaining under the compensation provisions.
Before leaving the sick pay scheme, I should like to say something about the position of disabled people. The present Minister for Social Security and his predecessor both took a close interest in the effect of the scheme on disabled people. Both sought to ensure there would be no adverse effect on the employment prospects of disabled people. A 100 per cent. self-deduction will go a long way to ensure this. As I have already mentioned, most employees are already in occupational sick schemes and most of these schemes pay more than the statutory minimum. We have found no evidence that this has led to a squeeze on disabled people's job prospects. Finally, the message of recent campaigns is beginning to get through: many disabled people do not have worse sickness absence records than their colleagues. Indeed, many of them are away from work less often than their non-handicapped, able bodied colleagues.
The position of the long-term sick has also been protected. Under our proposals someone who is sick for more than eight weeks in any tax year becomes the state's liability and he will stay with the state for as long as his illness lasts. I should stress that the national insurance 8-week linking rule applies to these cases. Furthermore, people transferred to the state will need only to receive a further 120 days of sickness benefit before they qualify for invalidity benefit. This concession will safeguard the position of the chronically sick. I turn now to Part II of the Bill. This is difficult ground over which my noble friend Lord Bellwin will lead your Lordships, with his usual assured and competent manner, in Committee; and it is particularly fitting that he should reply to this debate this evening.
Part II is concerned with the second major innovation to which I referred in my opening sentences, and once again we are looking at a problem that has been with us for a considerable time. It has been the subject of many comments—particularly from the former Supplementary Benefit Commission—drawing attention to waste and duplication in the present system.
At present a person not in full-time work and in need of assistance with his or her housing costs can turn in either of two directions. He can turn either to the Department of Health and Social Security and seek supplementary benefit or he can turn to the local authority for rebates or allowances against rent and rates. Even if a person's circumstances were not liable to change it is really far from easy to determine which of these mutually exclusive schemes would benefit him most. But circumstances do change for all of us, and very often the choice which proves right in the first instance may prove entirely wrong later on.
A further drawback to the system is that here once again we have two competing bureaucratic systems. By unifying the two systems the Government will obtain a further contribution towards their campaign

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to reduce the Civil Service to a reasonable size. There will be a saving, in this instance, of 2,000 posts. That will represent a net cash saving of up to £10 million. But this will not be applied to reducing the public sector borrowing requirement. It will be applied in extra benefit payments. Economic circumstances made it necessary to make this a "nil cost" change and that seemed a proper way of achieving it. The new scheme will be based on the local authority rebate and allowance schemes, simplified where possible, and supplementary benefit claimants will be entitled to full rebates of rent and rates without further income assessment. Local authorities can provide housing assistance to supplementary benefit claimants more efficiently than the Department of Health and Social Security.
Baroness Jeger: My Lords, can the noble Minister clarify one point? He refers to the number of civil servants who are to be reduced and he has just told us that the town halls will have to deal with more of these cases, so does it not mean that while he reduces Civil Service staff he has to increase local government staff?
Lord Elton: My Lords, I was about to touch on that. There will be an increase in the workload for local authority staff, but not by any means commensurate with the loss of workload by the department. At present the Department of Health and Social Security can give cash to claimants for them to pay rent and rates to the local authority officials the noble Baroness asked about, and they have to deal with that. There is also a large exercise each year to revise individual rent and rates to help to take account of increases. Under housing benefit all that goes. For the large majority of supplementary benefit claimants, authorities will not have to collect rent or rates. They will simply rebate them, although cash payments will continue to be made to private tenants. We recognise that local authorities will need some extra staff to cope with the extra volume of work and the Government have promised that these extra administrative costs—this is what the noble Baroness has been waiting for—will be met in full. There will, nonetheless, be overall administrative savings of up to £10 million, and, as I have said, this will be transferred to benefit expenditure.
Your Lordships will realise that very detailed provisions will be needed in order to introduce this scheme. Moreover, experience has shown that relatively frequent and minor adjustments will be needed to keep it in tune with the evolving needs of the community. For both these reasons it is apparent that it would not be appropriate for the detail of the scheme to be embodied in primary legislation. It would be far too costly in terms of parliamentary time—not merely at the point of introduction but on the frequent occasions for adjustment. The Bill therefore provides enabling powers for the introduction of the scheme by means of regulations. If I may summarise the salient points rather briefly: the provision for the power to make regulations governing the national statutory rebate and allowance schemes lies in Clause 28. Clause 29 was inserted by the Government in another place. It places a statutory requirement upon the Secretary of State to review the value of
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the needs allowance each and every year. The provision for the power to make regulations governing the local authority schemes lies in Clause 30. It will allow authorities, as at present, to improve on the statutory schemes, using their own resources to do so.
Clause 31 provides for publicity and Clauses 32 to 34 for the financial arrangements. Again, these build on the arrangements in the current rebate schemes, with the important additions that the local authorities will be compensated in full for additional benefit and administrative costs of giving rebates and rent allowances to supplementary benefit claimants. Finally, Clauses 35 and 36 deal with interpretation and supplementary provisions.
This change has also been preceded by publicity and consultation. The Government's proposals for housing benefits were outlined in a consultative document, Assistance with Housing Costs, published by the Department of the Environment, the Scottish Office and the Welsh Office last year. Since then, of course, responsibility for housing benefit has been transferred to the Department of Health and Social Security, which explains the anomaly. In the process of consultation it was established that there was a wide measure of support for the need to rationalise the existing provisions along the lines the Government proposed.
But there was also concern that the need to provide a nil cost solution produced a significant number of losers. Government have tried to reduce these; but I must make clear that the resources are not available to ensure there are none. However, it is important to realise that the Government proposals, as they stand, ensure that no supplementary benefit claimant will lose weekly benefit from the change; and that over 1 million of the poorest rebate claimants will gain. We did this by improving the rebate tapers for the poorest pensioners, with income below the needs allowance, and increasing the needs allowance for all pensioners by 75p a week. This means that 850,000 pensioners below the needs allowance and 220,000 just above it will gain on average by about £1 a week. These are significant improvements for very poor claimants. We were able to protect non-pensioners below the needs allowance, but these improvements had to be balanced by reducing help to the better-off rebate claimants. Overall, about 2 million will lose by an average of 50p a week—but the size of the loss is related to the amount of income, and nearly half lose 25p or less a week. Taper losses will also generally be limited to 75p at the start of the scheme.
We have striven throughout to improve our proposals and to produce the best scheme possible that circumstances allow. I should also add, with no little gratitude, that we have been greatly helped in this by the co-operation and expertise provided by the local authority associations. They have worked very closely with officials to produce workable and sensible procedures; they also suggested some improvements while the Bill was still in the other place and my honourable friend the Minister for Social Security was happy to accept them. This augurs well, I think noble Lords will agree, for the inauguration of the scheme when we come to it.
There are, of course, other important provisions in the Bill, but I think your Lordships will wish me to deal with them rather more briefly. Clause 38 removes

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the requirement that an unemployed person who claims supplementary benefit must be registered for work at a Jobcentre. (There is a corresponding requirement for unemployment benefit, but this is incorporated in regulations and not in the main legislation.) By enabling Jobcentres to concentrate on those who really need their services, this change will improve the service both to employers and to unemployed people. At the same time, it will achieve substantial staff savings. There will be no loss of control, since the availability for work of those concerned will continue to be tested when they make their claims at unemployment benefit centres.
Clause 39 is the first step in restructuring the industrial injuries scheme. The clause abolishes injury benefit—the short-term incapacity benefit payable to those injured at work or suffering from an industrial disease. Instead of this, those who are industrially injured will get statutory sick pay or national insurance sickness benefit. The money saved by this measure is being used to make disablement benefit—the scheme's long-term benefit—available from a fixed date in all cases. This will be 15 weeks after the accident or the incidence of the prescribed disease. These changes will bring substantial benefit to the more seriously disabled, and that is one of the principles underlying our proposals for the reform of the industrial injuries scheme as a whole.
Clause 43 rectifies certain defects in war pensions law and validates past awards made without adequate legal backing. It also contains provision for the Secretary of State to determine the commencing date of past awards in certain special categories of case. Hitherto, pension has generally been awarded from the date on which a claim was revived, but the clause makes provision for the payment of up to six years of arrears.
An underlying object of the Bill, complex as its drafting must be, is to achieve simplicity. Both its major proposals will abolish wasteful duplication of administrative work. Both, therefore, eliminate substantial amounts of unproductive employment that can be paid for only out of tax on productive work. The change in housing benefit, moreover, will remove entirely a very difficult dilemma that at present faces, in particular, many pensioners in need of help with their housing costs. These are objectives which will be welcomed by the country as a whole, and I commend the Bill to the House. My Lords, I beg to move.
Moved, That the Bill be now read a second time.— (Lord Elton.)
3.32 p.m.
Baroness Jeger: My Lords, I regret that this side of the House cannot commend the Bill to your Lordships, for many reasons which I shall try to set out as briefly as possible, because I accept that this is a Second Reading debate and this is very much a Committee Bill, as it is very detailed and technical and we shall want to come back to many points at Committee stage. I would not want your Lordships to think that we on this side are taking an old-fashioned Luddite view of national insurance, because national insurance must be an evolving sector in our society. We can go back to
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the Poor Law, to Lloyd George, and also to Churchill saying—and I have every sympathy with him—that he did not want to be shut up in a soup kitchen with Beatrice Webb. We can then go on to Beveridge and can work out how society has tried to come to terms with poverty, with illness and with chronic sickness, and has attempted to deal in a community spirit with the welfare of our citizens.
So we do not say that there should be no changes in social security. On the contrary, we want to join in any progressive measures which will change these arrangements for the better. But I have to ask several questions. First, this Social Security and Housing Benefits Bill must be seen in context with the present situation. Noble Lords will remember that the Social Security (No. 2) Act was very disadvantageous to many of the poorest people in our country; that we are in a situation where the number of people on supplementary benefit is increasing; and that, whatever is happening at the moment, there seems to be no underlying improvement in the unemployment situation. Yet we are bringing in a system whereby the poorest, the out of work and the sick people in our society will be disadvantaged.
They will be disadvantaged because the national insurance contribution is to be increased, because charges for dentistry, ophthalmic services and prescriptions are to be increased, and now we have to face a situation where there is to be a change which seems very onerous to some of us. I know that the question of unemployment pay is not included in this Bill, but as a former Member of another place I seem to recall that on Second Reading it is quite proper to refer to what should have been in a Bill, as well as to what is in it. But it seems absolutely outrageous that the sick pay that is to be brought in under this Bill is to be subject to income tax, and the fact that there is no provision for unemployment pay to be exempt from income tax is grossly unfair.
It was the understanding of many Members in both Houses that when benefits were brought into taxation they would at least then be brought up to the rate of inflation. But now we have a situation where it is admitted by the Government that unemployment pay is 5 per cent. below the rate of inflation and yet that benefit is to be taxed. I think that that is grossly dishonourable on the part of the Government.
I say that, because I have with me a copy of the Finance Bill dated 15th July, 1981, together with the Official Report of the sitting of Standing Committee B of 1st May, 1980, and at column 684 the Minister said:
"I do not, therefore, anticipate any difficulty in meeting the obligation to restore the benefits into tax and fulfilling the pledge that I have given. When the benefits come into tax the revenue will be there".
Many Members of both Houses took that as a pledge on the part of the Government, but that is a pledge which seems to have been broken. I hope that the Minister who is to reply will explain why the Government, at the same time as admitting that there is a 5 per cent. shortfall in unemployment benefit, are bringing that benefit into taxation.
This is a very difficult Bill and I have every sympathy with Ministers opposite. There really should have been two Bills. The question of sick pay should have been separated from the housing implications of this Bill. I

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have referred to the taxation of unemployment benefit but, of course, we now have to face the fact that, for the first time, sick pay is to be taxed. I correct myself, my Lords. It is not the first time, because the Labour Government tried to tax sick pay from July, 1948, to April, 1949. They then gave it up as a bad job, because it seemed that they were having to collect income tax from two different sources and that really was not practical.
One of the main accusations that we have against this Bill is that it is so full of regulations. I prefer legislation to regulation. I think that that is how this country wants to be governed. This is a Bill which will affect the living standards and lives of practically every family in this country. When people ask us about it, we are going to have to say, "Wait for the regulations". Any legislation which depends upon regulations is, I feel, deficient.
I want to ask the Minister several questions. Many of the points which we on this side of the House want to raise will be raised in Committee. However, I should like today to give notice to the noble Lord of some of our problems. First, what is to happen about employers who are slow to pay? I am thinking of the slightly sickly worker who is not very well. I am not talking about the registered disabled because there is a special attitude towards them. I am talking about a man or a woman who is not very well and who perhaps has more time off than his fellow workers. What is to happen if an employer refuses to make the payments? And what delay are the Government going to accept? We are speaking about people who might be very low paid and quite poor. How long can an employer hang about not giving them their money, when they have got the landlord knocking on the door for the rent?
Turning to housing, I refer to col. 649 of Hansard of another place of 23rd November 1981, when the Minister said that these changes would take place "without any increase of expenditure on housing assistance". This means that no extra assistance will be going into the housing accounts of this country at a time when many of us feel that there needs to be additional help with housing costs for everybody in the country. Can the Government ensure that under the Bill nobody loses? The Minister said in another place at col. 650 on 23rd November 1981 that nobody would lose more than 75p a week. I am old-fashioned enough to think of 75p as the good old 17s. 6d., and 17s. 6d. is not a sum to be—have I got it wrong?
Lord Elton: My Lords, the noble Baroness is apparently not fully metricated; 75p is in fact 15s.
Baroness Jeger: I thank the noble Lord. That is why I put it in an interrogative form. I cannot add up; I am totally innumerate. Nevertheless, I do not think that fifteen "bob" is to be entirely disregarded. The point I raised when I interrupted, I hope not discourteously, the noble Lord the Minister is that the reduction in the number of civil servants might well be balanced by the increase in local authority staff. If you say to people that they cannot ask for housing help from the DHSS and that they must go to the town hall, the town hall will have to provide for their reception. At least, I hope the town halls will.
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However, we certainly know from experience (having been chairman of a housing committee in Camden, I certainly know from experience) how patchy the provision is which town halls make for dealing with these problems.
I want to ask the Minister whether the Government have thought through the abolition of short-term industrial injury benefits. For many years there has been an agreement between the Government and the trade unions that people who suffer as a result of injury at work should receive special consideration.
My next question is this: how are the Government going to work out the needs basis? Some time ago it was said (I remember the debates on the Social Security (No. 2) Bill in which I took part) that the Government were interested in having a tax-related index which would be separate from the RPI. My research shows, (though I am open to correction, as ever) that the tax-related index shows an inflation rate of 14·9 per cent., which is more than the RPI index shows. This is relevant. If the Bill is connected with the levels of assistance and how we are to work out the amount of assistance, then we must reach some agreement about how we do the arithmetic.
It has often been said that the RPI does not do justice to the poorest people in our society. The poorest people obviously pay a higher percentage of their income on housing, fuel, food. Many items which come into the RPI are not relevant to them. They do not buy diamonds, cars, fur coats. They do not buy many of the things which are included in the RPI. When the Government agreed to bring in this new tax-related index we thought that it would have some relevance to benefits, but I have to say to your Lordships that we have not heard much about this lately; and the uprating of benefits certainly does not reflect the uprating of costs in the tax-related index.
I have to say to your Lordships that the very fact that in the Bill there is supposed to be a topping-up arrangement means, in our view, that the Bill is a failure. We all want (I hope I am not speaking at the moment in a partisan way) to get this question straight. However, when a Bill is introduced and the Government have to say that it will be a bit rough on a lot of people so there will have to be a topping-up, it means that the Bill is wrong. Topping-up means more bureaucratic work. It means that more and more people will not know about their right to benefit. The small take-up at the moment of many of these benefits indicates this.
When the Government say, "Never mind; we'll top-up anyone who is having a rough deal", I have to say to them that this is not good enough. Who are these people who are having a rough deal? They might be the illiterate; they might be people who do not speak English very well; they might be people who do not stand up for themselves very well. The Government are putting the responsibility on the poorest people and saying, "You will have to come along and ask for a topping-up". Instead of that, the whole trend of our national insurance policy should be to wipe out those kinds of applications. We want people to get their benefits as of right and not to have to go, cap in hand, to the town hall and say, "Can you top me up?" That is a backward step.

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May I also ask the noble Lord the Minister about the levels of assistance. Will there be any built-in index-linking of benefits? I have read the Bill as carefully as I can—I admit that not only am I not very numerate but perhaps I am not very literate—and I cannot find anything there which suggests that there should be index-linking of these benefits. In fact, it seems to be a Bill which will make the poor pay for the poor. The philosophical difference between us is that while we want a redistribution of wealth, the Government want a redistribution of poverty. The fact that they have to bring in this topping-up mechanism seems to be emphasising that point.
I want to ask the Minister also about Clause 35. This removes the need for registration of the unemployed. We believe that that is a great pity, because the unemployed are mostly in a situation of isolation and depression, and the fact that they do not even have to go down to register is not, we feel, a good thing socially. It seems to reject them from society, implying that nobody wants to know about them and that they need not even tell anyone that they are unemployed. This seems to us to be emotionally and politically a very bad thing.
I apologise for asking these questions now, but my hope is that doing so will save some time at Committee stage. The Government have reduced the number of inspectors for wages councils and the number of factory inspectors and health and safety inspectors. What are the Government going to do to ensure that this Bill is properly policed? How are the Government going to ensure that employers—and I refer in particular to small employers who have many difficulties with cash flow at the present time—will send the money to the man or woman who is off work for a week`? How many inspectors is the Ministry going to appoint to deal with this work? What is going to happen to workers who have been sick for more than eight weeks? What is the Government's answer to that?
Then I have to ask the Minister about the level of benefits. I understand (although, as always, I am subject to correction) that sick pay is to be calculated by reference to 1981–82 benefit figures; a sum of £22.50 for a single person plus £13.09 for a dependant adult, and 80p for each child. From those sums national insurance was not deducted, but now national insurance is to be deducted. Not only that, but income tax is to be payable on those figures.
Lord Elton: My Lords, either I have misunderstood the noble Baroness, Lady Jeger, or she has misunderstood the Bill. She mentioned the rate at which statutory sick pay was to be calculated. Has the noble Baroness perhaps overlooked Clause 7, where the actual figures (which are different from those she has just given) are set out? If that is the case, and the noble Baroness has not noticed those figures, then there is the answer. If she has noticed those figures, then will she rephrase her question so that my noble friend can answer it properly?
Baroness Jeger: My Lords, I have noticed the figures in Clause 7 because I have been living and sleeping with this Bill for the past week or two, as I am sure the noble Lord has. I was referring to the present
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payments and not to the payments under the Bill. It seems to me that a couple with two children will receive about £3.87 less under the new arrangements and this will be of some disadvantage to the family. My reading of this Bill and of all the deliberations in another place indicates that anyone who is receiving between £34 and £44 a week will be worse off. Then there is a cut-off of benefit at £60 a week. In case any of your Lordships imagine that no one earns less than £60 a week nowadays, may I say that, according to figures which were given in another place, more than 750,000 people in our country earn less than £60 a week. It seems to me, and again I am being interrogative, that there is a proposed flat rate of £37 benefit for people who earn more than £60 a week but that for people who earn less than £60 a week the benefit will be £25 a week. This is something we cannot accept.
Anyone who is trying to live on £60 a week or less already has no fat to cut into, and will already be having a very difficult time. Such people do not have a lot of savings, and are likely to be living on the edge of proverty all the time. To say to these people, who probably have no savings, that because they earn only £60 a week when they are at work they will get only £25 a week when they are sick, despite the extra expenses which any sickness brings, is totally unacceptable.
Lord Hawke: My Lords, I am very interested in what the noble Baroness is saying, but who exactly are these people in whole-time work who are earning less than £60 a week?
Baroness Jeger: My Lords, I thank the noble Lord, Lord Hawke, for that intervention. I do not know who these people are but the official figures show that there is this number of low earners in our country. This may come as a surprise to the noble Lord.
Lord Hawke: My Lords, are they not all in part-time employment?
Baroness Jeger: Not necessarily, my Lords. They may be in part-time employment because they are single parent families or people who cannot otherwise work full-time. That does not mean that they should be discriminated against when they are sick.
I also wish to ask the noble Lord, what additional rate burden is involved? The Government are boasting that the change in housing benefit—and we accept that there needed to be a change in these provisions—should be transferred to town halls. At a time when the Government are trying to squeeze towns halls to reduce their expenditure, what provision are the Government making to ensure that when a person in this situation is told by the DHSS that he had better go to the town hall because his housing has now been taken out of the RPI, there will be someone to see him? Will letters be written to that person? Will there be sympathetic officials able and waiting to talk to him? This is a very important question. The Government are boasting about the reduction in civil servants, yet they will have to face up to an increase in local authority staffing. As I said before, I have found the system all

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over the country to be very patchy in respect of the helpfulness or unhelpfulness shown towards people who have housing difficulties.
I wish to ask another question. Is it a fact that a low wage earner with a wife and two children will get around £13 a week less than sickness benefit if he was unemployed? That is a very important point, because once the Government make it more remunerative for people to stay at home than to go to work they really are on the wrong track. I must repeat our regret at the fact that there is nothing about uprating written into the Bill and nothing about index linking either. We must again ask about self-deduction. Employers are supposed to undertake 100 per cent. self-deduction. How is that going to be enforced? What is going to happen if an employer sends one or two people home because it will be cheaper for him to send them home and claim 100 per cent. back from the Government than to pay their wages? Unless there is a very adequate and expensive system of policing, the savings which the Government boast about will not be made. We are also worried about the abolition of industrial injury benefit because this was of special concern to the Labour Government; we would like to know more about the present Government's intentions in this respect.
The next and perhaps the last question I want to ask the noble Lord is this. I apologise, but this affects so many millions of people in our country that I do do not think we ought to deal with it in a casual way. Why are the Government apparently making this flat rate sick benefit and not taking into account the family circumstances of those concerned? Are the Government saying that, for example, a 19 year-old typist who lives at home is to be rated the same as a married man with three or four children? I know the answer the noble Lord the Minister is going to give me, that child benefit will take care of that. But if child benefit is going to take care of that then child benefit has got to be much uprated; it has really got to play a major part in the budgeting of the families of this country. So far there seems to be no indication that the Government are going to use child benefit in the further way that we want to see, to eliminate family poverty in this country. There seems to be in this Bill no reference to the family circumstances of a man or woman who is on sick leave. So this again makes me repeat that it is a redistribution of poverty.
Very briefly, I hope the Minister will be able to tell us something about the housing position and the help given to private tenants and people with mortgages, because the scheme seems to be very neat and tidy so far as council tenants are concerned—they should go along to the town hall and ask for this or that—but there are millions of people in this country (certainly in my old constituency there were thousands living, not at their own wish, in what was called furnished accommodation, which was often a sort of Rachman set-up) who will not be sure of their rights under this Bill.
In column 700 of the Commons Official Report the Minister admitted that 2 million householders would be worse off as a result of this Bill. It cannot be expected that this side of your Lordships' House could give its approval to a Bill which has that effect on the poorest people in the country. Therefore, because of
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all the difficulties and all the disadvantage that is encompassed by this Bill we cannot give it our support.
4.3 p.m.
Lord Banks: My Lords, I should like to begin by thanking the noble Lord, Lord Elton, for his very clear and thorough explanation of what he himself called a complex subject. The Bill, like Gaul, is divided into three parts: the statutory sick pay scheme, the unified housing benefit and the miscellaneous provisions. I think it will be generally agreed that the first two of those are the most important.
We on these Benches oppose the statutory sick pay scheme; we support the concept of a unified housing benefit, but we are not happy with the scheme as proposed. Our reasons for opposing the sick pay scheme are these. First, we are not in favour of fragmenting the national insurance system. We believe that the income maintenance system is best administered by the Government, and we do not agree with hiving off part of that system to employers to administer separately on behalf of the Government. We favour an integration of the tax and social security systems in a tax credit scheme, and under that there would be one benefit for inability to earn which would cover sickness, among other situations. We fear that the proposed system will be an uneven one which will have very differing standards of administration by different employers. Smaller employers cannot be expected to be uniformly efficient, and we feel there are bound to be some doubts about whether claimants are getting their proper entitlement, a point raised by the noble Baroness, Lady Jeger. We are not surprised that it is going to be necessary to appoint some 2,000 fresh inspectors to supervise the administration by employers of this inevitably complicated scheme.
As the noble Lord, Lord Elton, explained, the Government have put forward various suggestions as to how this scheme should be financed, but eventually they have come round to accept the view that employers should be recompensed 100 per cent. for what they pay out in sickness benefit over the first eight weeks. We welcome that as far as employers are concerned, but it does have certain implications, and those implications were clearly set out by the Government in their document Compensating Employers for Statutory Sick Pay, published in June of last year. This is what they then said:
"With 50 per cent. self-deduction employers would have a direct financial interest in controlling absenteeism and ensuring that they had properly applied the rules of the statutory scheme. One hundred per cent. self-deduction (that is what is now proposed) would not have this built-in control. Even if the number of visits to employers by DHSS inspectors were increased substantially, it is probable that some monies would be withheld from the National Insurance Fund, either erroneously, fraudulently or in respect of malingering. The inevitable consequence would be an increase in the employers' contribution rate. In effect a 100 per cent. self-deduction scheme would end up with the honest, efficient employer subsidising the dishonest, inefficient one. For these reasons the Government remain strongly opposed to this approach".
In the meantime, the Government have overcome their opposition to the 100 per cent. self-deduction scheme, but I am not convinced that they have overcome their own arguments.

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That it is going to be a complicated and difficult burden on employers, and particularly on small employers, was confirmed by Mr. Rossi, the Minister for Social Security, in the House of Commons during the Committee stage on 28th January 1982, when he said:
"We expect that an additional workload is bound to accrue during the early years of the scheme, when employers, especially small employers, who do not have the assistance of accountants and professionals to help them get their records right, will need assistance in operating the scheme and dealing with complicated matters such as waiting days and linking periods".
We are worried about the burden on small firms, for while there is to be recoupment for benefit paid out there is no compensation for administrative expenses. We feel also that there is a possibility of discrimination against those with a history of sickness, just as the noble Lord, Lord Elton, said about those who are disabled. We would agree that 100 per cent. recoupment does make that less likely, but the possibility is there.
There are some details about the scheme with which we are not happy. One of those is the lower rate to which the noble Baroness, Lady Jeger, referred. If we regard £37 as being fixed as the subsistence level, it is difficult to accept the lower rates of £31 and £25 which are to apply to people earning between £45 and £60 and people earning under £45. I think this is probably the answer to the point raised by the noble Lord, Lord Hawke, who intervened earlier. At present, if full contributions are paid, then full benefit is paid.
The second point of detail on which we are unhappy is the fact that national insurance contributions will now have to be paid on sick pay, thus reducing the net amount. I point out that I am talking about national insurance contributions and not about taxation. As I understand it, a sick married man in the highest bracket will receive £34.13 a week after insurance contributions, as against £36.40 at the moment, not subject to insurance contributions. I think that in this context it is important to bear in mind that about half of all males in receipt of sickness or invalidity benefit have an adult dependent.
The third point has been referred to by the noble Baroness, Lady Jeger, and it is the fact that there are no additions for children. The Government are already reducing the present additions for children faster than they are increasing child benefit. In fact, in the present year, they are reducing child additions, although child benefit is only increased to take account of inflation in the past year. We agree with the principle of replacing child additions by child benefit, but as we reduce the child additions we must increase, in our view, the real value of child benefit to compensate; and, as we understand the position, the Government are not doing that.
If there are these drawbacks to the scheme which the Government propose, why do they want to proceed with it? One of the reasons advanced—and it was advanced by the noble Lord, Lord Elton, this afternoon —is that a very large number of employees are now covered by occupational schemes. The noble Lord mentioned the figure of nearly 90 per cent. The figure more often used in this connection is 80 per cent., although that is based on a survey eight years ago, in 1974. But I wonder whether the figure is 80 per cent. or nearly 90 per cent. when one bears in mind that
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many of these schemes do have a waiting period, a qualifying period, during which people would not be covered by them although it might be thought that, since they were employees of a firm which had such a scheme, they were so covered. Of course the numbers covered vary enormously from industry to industry. It is not uniformly 80 per cent., or whatever, throughout the whole of industry, and one-third of manual workers are not covered in this way at all.
It is the view that this is an easy way of bringing the sickness benefit into taxation. That, of course, is true. But I do not believe that it is the only way in which we can bring sickness benefit into taxation. I do not believe that that in itself is a sufficient reason for putting forward a scheme of this kind. I think that the Government's main reason for putting this forward was that originally it was to save £400 million a year and 5,000 Civil Service jobs. That was before they accepted 100 per cent. recoupment. The £400 million has now disappeared and, as I understand it, the administrative savings are somewhere in the region of £30 million. I think that the noble Lord, Lord Elton, mentioned the figure of £90 million earlier; the figure which I have is £30 million, but no doubt that will be sorted out during the course of our debate. However, it is a very much smaller figure than that which was originally envisaged. The number of Civil Service jobs saved has been reduced from 5,000 to 3,000 by the need to appoint some 2,000 inspectors. I do not feel that these estimated savings justify changing to a system with the drawbacks which I have outlined.
Let me turn briefly to the unified housing benefit. We certainly agree in principle that many people have to choose between rent and rate rebates and supplementary benefit, and it is estimated the 400,000 people are making the wrong choice and choosing a course of action which is less beneficial for them. As the noble Lord, Lord Elton, pointed out, this is a reform which was advocated by the Supplementary Benefit Commission in the years before their demise. But they always advocated that there should be additional resources. The noble Lord, Lord Elton, made it clear that the Government are not providing additional resources, and he made it clear that this meant that there must be losers as well as gainers, or, rather, that if there are to be gainers then there must be losers. I think that the estimate—certainly the original estimate—was that 800,000 would gain but 2 million would lose. I think that that still stands. Certainly it was the original Government estimate.
In the consultative document, the Government estimated that 74,000 current recipients of supplementary benefit would be worse off on rebates, and so provision was made for the "topping-up" payments from the DHSS to which the noble Baroness, Lady Jeger, referred. But I wonder whether this joint system will be administratively feasible for both administrators and claimants. There are many people who think that it will not be. I wonder, too, whether we can be told who will identify those entitled to topping-up payments. Can we be certain that no pensioner, whether reliant on supplementary pension or not, will lose out? I am not convinced that it is right to put this additional burden on local authorities. Will it not merely multiply the number of offices with which some claimants have to deal?

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Again, I am not happy about the decision to exclude housing costs from the retail price index when adjusting supplementary benefit for inflation. There is some logic in this because there is what has been described as "double counting". But our supplementary benefit rates are not over-generous and in my view should not be reduced in real value. If there is to be a differential, then I should have thought that it should not be introduced until it is possible to increase the real value of supplementary benefit levels generally.
In accordance with convention we shall not oppose the Second Reading of this Bill this afternoon, although that was the course taken by my right honourable and honourable friends in another place. But we share their dislike of the sick pay provisions and will continue to express our misgivings about certain aspects of the unified housing benefit.
4.18 p.m.
Lord Boyd-Carpenter: My Lords, I should like to join the noble Lord, Lord Banks, in thanking my noble friend on the Front Bench for a remarkably clear exposition of what he himself rightly described as a highly complex measure. I am sure that the House, whatever views we may take on the merits of the proposals, is really indebted to my noble friend for a quite masterly display. I would agree on one point, too, with the noble Baroness, Lady Jeger, on the Bench opposite, when she said that basically this is a Committee Bill. I agree that it is a Bill on which our best discussions are likely to take place in Committee and perhaps at the Report stage.
I would venture none the less to quarrel with the noble Baroness when she diverted from a very interesting and agreeably expressed analysis of the provisions of the Bill, into one of those outbursts of what I can only describe as "party passion" to which she is so susceptible. I was so moved by this that I took down what the noble Baroness said. She said:
"While we want to see a redistribution of wealth, what the Government want to see is a redistribution of poverty".
That is a splendid rounded phrase, which I am sure would bring echoes of applause in Camden or some such place. But it does not, of course, stand up to analysis. Nor, if she will allow me to say so, is it fair to attribute motive of this kind. In this House we very much criticise—I, for one, am certainly guilty of it—the arguments and views of those who sit opposite us, but, on the whole, I do not think that we criticise their motives. On reflection, the noble Baroness may feel that that kind of remark, though it no doubt eases her feelings to make it—and that is no doubt a good reason for doing it—does not really make for clarity in this debate.
However, I want to follow it up, because I think that she there disclosed one of the reasons why in recent years Labour Governments have been such a disastrous flop. The concept is the simple one of a large cake which a benevolent Government cut in such slices as they think appropriate for different sections of the community to have on their plate. Of course, in fact, that is basically the communist approach, except that it is to be noted that in communist countries the Government—the people on top—receive an enormous slice, disproportionately far
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larger than the wealthy in this country receive, and the people at the bottom of the scale receive a minute slice.
However, with respect, it is a wrong concept, because a Government should be concerned, not about the redistribution of wealth, but about its maximisation. It is in that way, if you so manage the economy that you get an increase in wealth generally, that you improve the position of everybody. I do not speak without having facts in my mind. This is precisely what happened in what is now called the Macmillan era, when, because the national wealth, under wise policies and good administration, was growing year by year, the standards of life at every level of our community improved. What is more—and I can bear very direct witness of this—the funds available for our great system of social security were increased every year by successive Chancellors of the Exchequer.
From the diverting subject of the noble Baroness, I should now like to return to the perhaps more austere outlines of the Bill. I agree with the proposal to transfer to employers the responsibility for the payment of short-term sickness benefit, provided that it is so arranged—as the Bill now arranges it—that no additional financial burden is imposed on employers. I put that proposition not, I hope, in any selfish sense, but simply because at this moment, with the unemployment figures that so concern us all, it is folly to add anything to the cost of employing people. Indeed, it must be the object of Government to lessen the charge on an employer who gives employment.
That is why, unlike the noble Lord, Lord Banks, I welcome this 100 per cent. deduction. As I understood it, a 50 per cent. deduction would have landed employers with some additional cost. I do not want to weary the House with it, because this is perhaps more appropriate to an economic debate, but the whole problem of getting the economy going again and of tackling unemployment is so much aggravated by the existing heavy burdens that fall on employers—national insurance contributions, (even with the employer's surcharge to be reduced in August by a certain amount), rates and corporation tax. All the burdens placed on those who provide employment are one of the major handicaps to British industry and, therefore, the recovery of the British economy. If we had not had this 100 per cent. deduction, I, for my part, would have found it extremely difficult to support my noble friend on this Bill.
But now that that has been decided upon, I think that there are very considerable advantages. It is, of course, the fact—I think that my noble friend mentioned it in passing—that as many good employers continue full pay during at any rate a period of sickness. Where it has been possible on top of that to draw sickness benefit, with tax and national insurance contribution free, people have been distinctly the better off for being off sick. My noble friend coined a rather nice phrase; I think he called it the "ailment gap". But it must be wrong to have such a situation. When one adds to that the very real saving in bureaucratic manpower that can result from this, it seems to me that this proposal, which no one can accuse the Government of rushing—it has been put forward in Green Papers, White Papers, and papers tinged with white and green, and has been

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very widely discussed with all the organisations concerned in industry—is a progressive scheme which I think it is right to enact, and I, personally, welcome it.
There are one or two questions which I should like to ask my noble friend who is to reply to clear up. How will this apply to the very small employer—literally to the employer (and there are quite a number) who employs one person? Let us suppose that that one person is away sick. If the employer has to pay at the rates laid down in the Bill, that person's equivalent to sickness benefit, with no deductions for the future that he can make—because, ex hypothesi, that person is away—will he not be put in some difficulty? The sums involved in individual cases are small, but so are the employers concerned. What is the position? It is not uncommon, particularly in the countryside, for a person to have just one employee. Let us remember that where you have one employee and that employee is away sick, you are minus 100 per cent. of your manpower, and you are already in a very considerable difficulty. I wonder whether some alleviation for that situation is contemplated.
Secondly—and it may be that my reading of the Bill has been insufficient—what is the position in respect of employers whose employees are abroad? There are different categories. There are those who work for a British company and who are stationed abroad, perhaps in the Gulf, for four or five years. Then there is the case of the employee sent on a short mission who goes sick abroad. What is the position in respect of them?—because there are many in one category or the other, and, hopefully, as our policies of opening up overseas activity go ahead, there will be more. I am sure my noble friend will agree that it is very important not to make it more difficult for British firms to have their employees abroad.
I do not propose to comment, at any rate at any length, on the other main aspect of the Bill, the housing benefits. The subject is a complex one and I am not without some sympathy for the noble Baroness on the Benches opposite, having doubts about the efficiency of a good many local authorities' administrative systems and their ability to cope adequately with what I understand will be additional burdens put upon them. I think that this is a matter which we shall need to analyse rather carefully in Committee.
In this connection I should like to ask a question which I hope your Lordships and the Minister will not think funny, but it is a question arising on Clause 29. There, when prices rise, provision is made for the Minister either to increase the benefit figure or to lay a statement as to why he is not doing so. As I read that clause, there is no provision to deal with the situation if prices fall. It is within living memory—in the 1930s—that the index of prices fell consistently for a number of years. When one is legislating in an uncertain future, is it wise to exclude the possibility that the Government's measures may be so successful that inflation will not only be contained but reversed?
By way of warning, let me remind my noble friend, who may well be aware of it, of the error which the ex-service organisations made in the 1930s. They had pensions then linked to the index of retail prices. As that index fell as we got into the late 1920s and early 1930s those pensions were reduced. The ex
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service bodies formed up to the Government of the day and persuaded them to break that link. Needless to say, within another six months prices started to rise again, but that is an indication—perhaps an illustration—of the unwisdom of not catering for that situation. It may be that I have misread the Bill and there is machinery to deal with this. I should be interested when my noble friend replies to hear what he has to say.
I rather share sentimentally the noble Baroness's nostaligia over the passing of the industrial injuries payments. They are historical. I myself often wondered why there was the distinction between the person who got hurt at work and the person who became sick elsewhere. It was sometimes difficult to deal with because there were always the difficult questions about the person hurt on the way to work. I think he got industrial injuries benefit if he was in his employer's transport, but not if in his own.
One got these tiresome distinctions affecting quite appreciably the benefit obtained. It is logical to bring them together, and I suppose it is really due to history that industrial injuries took priority, going back early into this century, over the general national insurance sickness benefit. Many people have given a good deal of their lives, particularly many noble Lords on the Benches opposite and in another place, to an understanding of this scheme, and to appear before the tribunals that deal with it. One perhaps feels a little inclined to be sad at the passing of what was quite a considerable landmark.
On the other hand, I am delighted, assuming I understand it, which is by no means to be taken for granted, by the provisions in respect of war pensions in, I think, Clause 43, for loosening and making more flexible, as I understand is their purpose, the capacity of the war pensions scheme to deal with unusual cases. May I illustrate the importance of that by a reminiscence of a case which it was my duty to handle when I was Minister of Pensions and National Insurance a good many years ago.
There was, and I believe still is, an important war pension benefit called unemployability supplement. As its name suggests, it went to the war pensioner so badly disabled that he could not work. The case was that of a pilot in the RAF who lost both arms—ghastly mutilation. He of course was entitled, among other 100 per cent. disability and the rest, to unemployability supplement. A little after his accident it was brought to my attention at the Department that this man, because he had taught himself to paint pictures with a brush held in his teeth or his toes, was earning between £2,000 and £3,000 a year which, in those days, was something like two to two and a half times the average wage. It was therefore represented to me that I had no power to go on paying him the unemployability supplement.
I told my Permanent Secretary that I would not withdraw it in that case. My Permanent Secretary then told me sadly that in accordance with his duty as accounting officer he would have to submit a formal minute which would land us both in front of the Public Accounts Committee. Having cleared the air with these opening salvoes, we then got round to it and produced an entirely new regulation enabling the payments to be made, and this extremely gallant pilot

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himself obviously never knew what had happened behind the scenes. That is an illustration of the need in war pensions, which is essentially a benevolent, if you like almost patriarchal system, to have the utmost flexibility. If I understand Clause 43 aright, it is designed to increase the already considerable degree of flexibility that there is in that system. If that be so, I welcome it particularly.
As I said, and the noble Baroness said, this is a Committee Bill, and no doubt there will be quite a lot of discussion on it, but in general it seems a progressive move forward which I welcome and I believe a great many Members of your Lordships' House will welcome. As the noble Baroness said, national insurance and social security systems are not a beautiful object preserved for all time in the form in which they were originally evolved. They are a living and growing organism; and it is perhaps significant of the drive, vigour, and flexibility of mind of those at present in charge of the department that we get a Bill of this kind. I welcome it.
4.35 p.m.
Lord Kilmarnock: My Lords, I too should like to thank the noble Lord, Lord Elton, for his—I think Lord Boyd-Carpenter's word was—masterly introduction of this Bill. The noble Lord is always magisterial. The two principal schemes introduced by this Bill are the new provisions for statutory sick pay and those relating to housing benefits. I shall begin with the housing benefits, with which we do not disagree in principle, pass then to the sick pay arrangements on which we have very serious reservations, and then touch briefly on an important opportunity the Bill has missed.
The principle of a unified housing benefit is welcome. The present overlap of two schemes for housing assistance—one through the rent and rate rebates or allowances and the other through supplementary benefit payments—is confusing. If a tenant is eligible for both types he may choose to apply for whichever helps him most, but even professional advisers find it hard always to advise him correctly. Many people must have claimed the wrong benefit and lost out financially. I think that the noble Lord, Lord Banks, mentioned the possible figure of £400,000.
On these grounds we welcome the principle. At the same time we are concerned about who will meet the costs of administering the unified scheme. The enabling proposals transfer the responsibility for means-tested supplementary benefit support from the Supplementary Benefit Commission to a local authority rebate scheme. I understand that this change is estimated to yield a reduction in DHSS staff of some 2,300, at a saving of £25 million, but to require an increase in local authority staff of about 1,500 or 1,600. How is the increased local authority responsibility to be funded?
All local authorities today, as the Government well know, have great difficulty in budgeting their expenditure within the cash limits imposed by central Government. Are the Government going to accept 100 per cent. liability for the proposed transferral of costs which are estimated in the financial effects of the Bill at £15 million to £19 million? The noble Lord, Lord Elton, spoke about co-operation with the local authorities. My information is that some are still extremely worried
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on this score and fear that the increased costs, or part of them, will land on the local rate fund. Are the Government in close consultation with local authorities on this question, and can the noble Lord, Lord Bellwin, allay their outstanding fears when he winds up later this evening?
Turning to sick pay, one of the main aims of the new scheme is to tidy up the anomaly that someone whose pay is fully guaranteed by his employer when he is sick may receive more when sick than at work, because sickness benefit is not at present taxed. Sick pay, by contrast, like other short-term benefits, is to be brought into tax. Both major parties have, of course, entertained this idea from time to time, as the noble Lord, Lord Elton, pointed out; but it should not be forgotten that people's expenses also frequently rise during illness owing to such things as increased fuel bills and prescription charges. I rather wonder whether the Government have taken such additional outgoings into account in the minimum flat rates they have set.
The next main claim for the scheme is that it will cut out duplication of administrative effort. On the face of it, there may well be an argument for making employers the Government's agents for statutory sick pay up to a limit of eight weeks, and giving them the right to 100 per cent. reimbursement, though in fact it is not quite 100 per cent. as they will now have to pay national insurance contributions. This requirement was removed in the Standing Committee but has now been reinstated in the Bill at Report stage in another place. It certainly sounds a great deal cheaper administratively, and at Second Reading in another place the Government claimed a net saving over the two schemes of 4,700 public sector staff. But I am not clear whether their calculations of the financial effects of the Bill take into account this not insignificant number of redundancies. Perhaps the noble Lord will enlighten me when he comes to wind up.
There are other things here which worry me. First, there is the effect on small businesses, on which the noble Lord, Lord Boyd-Carpenter, also touched. Small businesses employ 16 per cent. of the workforce, a lesser percentage than in other European countries but still a large number of people. Will the small employer be as well equipped as the large corporation to comply with the new law?
If the method of reimbursement is to be by self-deduction by the employer from his national insurance liability, what happens if he has only a few employees and several of them go sick at the same time—for example, in a 'flu epidemic—and his liabilities under statutory sick pay exceed his liability to national insurance contribution? His cash flow may be seriously affected, particularly if he must take on temporary staff. Have the Government thought of that?
Other reservations are expressed by the Social Security Advisory Committee—which, it will be recalled, has replaced the Supplementary Benefits Commission—in their excellent first report which I have with me and which I recommend to those of your Lordships who are interested in these matters. While reserving their judgment on the desirability of SSP, the committee called for safeguards that would, to quote from their paragraph 2.52:
"help to ensure that employers administer SSP as efficiently, fairly and speedily as sickness benefit".

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That concern was also shared by Members of various political hues in another place, where worries that the expense of monitoring the scheme might make some of the savings illusory were expressed, a point mentioned by the noble Baroness, Lady Jeger, and the noble Lord, Lord Banks. Earlier in their report, at paragraph 2.51, the Social Security Advisory Committee said they were.
"glad that it is intended to maintain the value of SSP in real terms subject to economic circumstances. But we would have liked to see the real value of SSP and sickness benefit fully protected by a statutory guarantee. The Bill requires the Secretary of State to review the SSP rates each year to see if they have retained their real value, but it does not require him to make the necessary increases to restore the rates to their former values".
The relevant section and subsections of the Bill are Section 7(3) to (10). In subsection (4) the Secretary of State is allowed the extraordinary licence of estimating the general level of prices in such a way "as he thinks fit", though he must lay his reasons before Parliament. That is perhaps something one could accept as a sufficient safeguard if the Government's record in these matters were better, but it has not been good and therefore it is a subject to which we may want to return in Committee.
I come briefly to the general framework of social policy in which the Bill has been introduced. It follows the Social Security Act 1980, the Social Security (No. 2) Act 1980 and the Social Security Act 1981, all of which whittled away benefits in one form or another. In this measure, the Government have missed an important chance of improving their record and saving their social security policy from falling into disrepute. These are all portmanteau Bills. It would therefore not have been inappropriate to have included a clause, as was proposed and narrowly defeated at Report in another place, to make good the 5 per cent. abatement in unemployment and other short-term benefits made by the 1980 Act, on the understanding that it was in lieu of taxation and would be made good as soon as these benefits were brought into tax, which I understand will happen in June of this year. There is also the question of the 2 per cent. shortfall as a result of the under-estimate of the rate of inflation for 1981, making altogether a 7 per cent. downgrading of these benefits from the level at which they should, in equity, stand.
In another place there was a heated debate on whether the Government had given a cast-iron undertaking to restore the abatement, as claimed by the principal Opposition spokesman, or whether it was merely a conditional undertaking, as claimed by the Government. I shall not pursue the niceties of which type of announcement, and by whom, takes precedence in committing a Government. I would much rather stick to the principle and be guided, once again, by the Social Security Advisory Committee, in whose report it was estimated (in chapter 1, table 5) that the savings which would be effected in social security expenditure in 1982–83 through the various Bills to which I have referred and the measures now in prospect would be a whacking £1·856 billion. Even if we accept that the saving on SSP is not £400 million, as was originally intended, but only £90 million, we still get a whacking £1½ billion.
In a letter of 27th October to the Secretary of State
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—published in appendix 2 on page 69—the chairman of the committee stressed the importance of sustaining the real value of supplementary benefit, a timely reminder when one thinks of the increasing number of people becoming wholly dependant on supplementary benefit when their unemployment entitlement runs out. He went on to express special concern about the impact of the 5 per cent. abatement. The improvements sought by the committee are:
"equal to just a small proportion of the large savings, of nearly £2,000 million, already achieved or in prospect".
Elsewhere the committee estimated the cost of restoring the abatement at £50 million. On 22nd December last, the chairman felt it necessary to write again to the Secretary of State when it was announced by the Government that the additional 2 per cent. shortfall in current short-term benefit rates might not, after all, be made good in November 1982. In their chapter on priorities and recommendations (chapter 3, paragraph 2) the committee pointed out that if those cuts were not made good, it would amount to,
"double taxation of a severely disadvantaged group"
—"double" in the sense that the diminished benefits would also be subject to income tax.
The Social Security Advisory Committee described the social security system as a vital safety net. I would go further and say it is the cement of a civilised society. It has been calculated by the Child Poverty Action Group that one in four of our whole population is living in conditions of, or bordering on, poverty. That, combined with the inactivity and purposelessness imposed by unemployment, can only lead to severe cracks in the social fabric, and we have detected some quite alarming ones already. The social security system provides the essential mortar required for the preservation and maintenance, in reasonably good order, of the whole edifice of our society.
The Social Security Advisory Committee's report is very fair to the Government, chiding where chiding is deserved, warning where warning is required and giving credit where credit is due. Having appointed an advisory body with a wider remit than the old Supplementary Benefits Commission, the Government would do well to pay close attention to its advice.
4.47 p.m.
Lord Pitt of Hampstead: My Lords, I shall not delay your Lordships for long because I wish to comment only on Part II of the Bill. My understanding is that 3½ million people will be affected by the proposals on housing benefits and that 2 million, or more than half, will be affected adversely. However strongly one wishes to support the principle of the Bill, those consequences cannot be accepted. Because the Government's insistence on there being no increase in public expenditure is responsible for the fact that 2 million of the 3½ million people affected will be adversely affected, it is up to the Government to face up to that fact and try to do justice to those people.
We must remember that in the last three years rents have increased tremendously; in fact, they have more than doubled, and I am speaking of local authority rents. Therefore, the rent rebates about which we are speaking have assumed a greater significance, simply because of the sharp increases in rents. From the

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information I have received, it would cost only £30 million to introduce a package in which there would be no loser. I accept that £30 million is a lot of money, but in the context of the totality of expenditure on housing and supplementary benefits, it is not a large percentage. Moreover, the Government are planning a revision of the supplementary benefit re-rating, so there will be savings there in addition to the savings to be made on manpower as a result of the changes in the payment of sickness benefit.
If we are dealing with the matter in totality, there is a saving which could enable the Government to introduce a "no loser" package, and so avoid what I gather is the only real criticism that is being made of the scheme. I seriously appeal to the Government to reconsider their stand and see in what way they can introduce a scheme in which no one will be on the losing end.
The other matter which has attracted criticism is the fact that there will be no appeal. At present people who receive housing benefits can appeal to the supplementary benefit appeals tribunal. They will lose that right of appeal through this Bill. I should have thought that we ought to extend, rather than restrict, people's right of appeal. Therefore I suggest—and again I hope that the Government will think seriously about it and act on it—that people who are dissatisfied with decisions on their applications for rent rebates should be able to appeal to the supplementary benefits appeals tribunal. That would not create much more expenditure for the Government, and I hope that despite their wish not to increase expenditure, they can see their way to taking up that suggestion.
As many other speakers have said, this is really a Bill for Committee rather than for Second Reading, and I do not intend to go further into it than the points that I have made. I have made them at this stage because I want the Government to think about them before Committee. This is a Bill that we shall have to go through very carefully in Committee and endeavour to improve. In the meantime we shall give it a Second Reading.
4.53 p.m.
Baroness Lane-Fox: My Lords, T should like to refer to Part I, Clauses 1 to 4 of the Bill. When I was engaged in remunerative employment of various kinds it was always a great surprise to find that national health insurance operated in what seemed to me a strangely inexplicable manner. Fortunately, like most disabled workers, I was off work through illness on only few occasions, but each time I was amazed to discover that while my employer continued to pay me in full, he refused to accept from me the national health payments that I received. I still believe that those payments had to belong to him, or at least to someone other than me. Accountants and establishment officers argued with me and did their best to try to convince me that this strange performance was perfectly in order, that the labyrinthian ways of insurance required this to happen.
It was puzzling to be paid almost double just because you were off sick, and it seemed a remarkable temptation to those who realised that it paid handsomely to be sick. Other workers told me that this was recognised practice, and it seemed pedantic for me to make
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a fuss about it. In self-defence I must remind your Lordships that that all occurred before the days when there was any mobility allowance, or attendance allowance, when as a disabled person it cost money to go out to do a job. So I was one of the many who accepted, without too much difficulty, what was clearly a wrongly directed bonus.
For years this bad practice has gone through on the nod. Unlike the noble Lord, Lord Banks, and the noble Baroness, Lady Jeger, I congratulate my noble friend the Minister on the courageous Part I, Clauses 1 to 4 of the Bill. Generally we disabled people are seen, justifiably, to be asking for more. Now perhaps by way of retaining our credibility and clarity I should like to applaud this long overdue tidying up of a wrongly directed payment. Nevertheless I welcome the questions about cash flow involving small employers posed by my noble friend Lord Boyd-Carpenter.
With due respect for a scheme that has done so much for disabled people in the past, I should like, very briefly, to turn to Part III and the clause which refers to those who are incapable of work due to industrial accident. I should have thought that it is a substantial improvement for persons to qualify for sickness benefit without having to satisfy the contribution conditions. The fact that the clause also makes the long-term industrial benefit payable after a fixed period of 15 weeks must be beneficial.
It is so important at the beginning of a period of disablement to have made known to one all available helpful advice, so that as far as possible a sensible reassessment of everyday living can be made at such a traumatic time. I wish my noble friend the Minister well with the Bill, in particular on both the counts that I have mentioned.
4.56 p.m.
Lord Wallace of Coslany: My Lords, I am afraid that I cannot follow the noble Baroness in congratulating the Minister on the Bill, or in welcoming it. I enjoyed the noble Baroness's reference to the good old days when some generous employers did not deduct one's sickness benefit; but a tremendous number did, and if one was out for more than about a fortnight, one was out on the dole queue; and that was the end of that.
There does not appear to be an overwhelming interest in the Bill, but I believe that the interest remains outside, in the country. I should like to thank the noble Lord, Lord Elton, for his detailed outlining of the Bill's provisions, given in his usual, gentle, bedside manner, which he has cultivated to great success. But although he clothed to an extent the skeleton of the Bill, clearly this is an enabling Bill, and the House will have to await a series of regulations, which will have to be seriously considered and debated.
I listened with interest to the noble Lord, Lord Boyd-Carpenter, and gained an impression about the financial advantages of being sick. I could not quite agree with him, since being sick is bad enough without being accused of taking financial advantages; and there are other problems, as other noble Lords have pointed out.
My noble friend Lady Jeger certainly went to town and asked so many questions that I am sure that the Minister will not be able to answer them all this

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evening. However I think I am correct in saying that we do not expect all the answers this evening, but we are giving the Government a reasonable opportunity to appreciate some of the points on which we shall base our—I shall not say attack—constructive approach in Committee.
This is yet another social security Bill, and if there is a note of weariness in my voice, it is because from this Dispatch Box I have been involved in so many such Bills. This is one of a number of similar Bills which the Government have brought forward since they took office, and, in one degree or another, all of these Bills have undermined the fabric of the welfare state. Some one has estimated that so far we have had 10 Bills with the same objective. I have lost count; it might be 10, it might be nine.
The theme of this Bill, as with all the others, is financial saving, with the side effect (in this Bill) of a further addition to the ranks of the unemployed by abolishing some Civil Service posts. There is some difficulty here as to the actual numbers. The Minister mentioned 3,000, but I think that the total number will be in the region of 6,000 civil servants. At the same time the Bill will place additional pressures and work on employers and local authorities. I accept that there will be a measure of financial assistance to employers and local authorities, but the pressures remain, and they will place a considerable burden on the small employer so far as the sick pay proposals are concerned.
I go back with a certain amount of sentimentality to during the war, when I was serving in the Royal Air Force and when the main topic of conversation apart from when we should get out of the war was the Beveridge Report. There is no argument about that; and I profoundly believe it had a significant effect on the result of the following election. It heralded to us in the forces a new dawn. Today, this Bill moves away from the comprehensive and unified welfare structure that we have had since Beveridge. One of the principles basic to that was the unification of responsibility, a single insurance fund and a single Ministry, and this Bill, among others, disrupts that principle.
No mention is made in this Bill about restoring the 5 per cent. cuts in unemployment and invalidity benefits. It is coincidental, incidentally, that the Social Security Advisory Committee issued its first report a few days before this debate. Some measure of the Government's attack on the social services is that it would cost £686 million to restore social security benefits to the level that they were when the Conservatives came to power in 1979. I hope that in due course we can debate this report.
The proposals in the Bill to put the payment of statutory sick pay on to employers is likely, in my view —and I have said this before—to cause a degree of industrial unrest. It is claimed that 90 per cent. of employees are covered by union agreements on occupational sickness schemes. I think that this seems to be a high figure, and could well be over-estimated. Even so, there are at least 10 per cent. of workers without union protection, mainly engaged in small business concerns. One or two speakers have mentioned their concern over that 10 per cent. not getting union
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protection, and it is welcome to hear some support for union activities.
My Lords, the Government are setting up a task force (which is a new and popular phrase at the moment) of inspectors to check on employers' actions. I must say that that is a complete change from the last Bill, when we had a large task force of inspectors to check up on so-called scroungers. So benefits are now being challenged in another direction: we are now checking on employers as well as claimants— "Ah, well! Life goes on under a Conservative Government in a way that we have never had before".
I believe that employers running small businesses get the worst possible treatment under the Bill. The big boys (and many noble Lords associated with them know this) are well able to take care of themselves, but the small employers will have to carry a very heavy burden that they are least able to bear. They will be out of pocket immediately, and will have to wait for financial refunding. Most small employers are reasonable and fair, and, as I have some contact with them, perhaps I may say that relations with the employees are, in the main, almost paternal in these smaller businesses. But the unrepresented 10 per cent. of employees mainly work in this field and severe difficulties must arise on both sides. The 10 per cent. are mainly low wage-earners, and the sick pay scales mentioned in the Bill for them are the lowest.
Now I come, not to Clause 35 but to Clause 38. I think that the Bill has been amended, and it is now Clause 38 which raises the debatable issue of registering for employment on a voluntary rather than a compulsory basis. This is indeed a very bad clause, and ought to be removed. I do not claim, as some have claimed, that it is an attempt to "cook" the employment figures. I do not think the Minister or his colleagues would countenance that for one moment. But it will mean a reduction in the usefulness of job centres in placing people in employment, and will substantially undermine the work of the Manpower Services Commission.
Turning to rents, the Government have already forced up rents to record heights. I think the rise is now some 78 per cent. and in the very near future is very likely to be about 140 per cent. Under the Government's proposals in the Bill there will be, on the Government's own admission, 2 million worst-off losers under the scheme. When we talk about 2 million worst-off losers, we are talking about 2 million households at the very least. It is not just one loser; it is a whole family, a household. The housing scheme, as has already been stated, is very complicated, to say the least; and it is absulutely vital—and here I agree with other speakers, particularly the noble Lord, Lord Pitt, who spoke a few minutes ago—that there should be a right of appeal to an independent body.
Local authorities will take over an increased burden, and, with all the good will in the world, mistakes will be made. I have worked with local authorities as a councillor, and I know that they do a good job, but the human element comes in and mistakes will be made. With all the good will in the world, you will not get perfection. It means one thing: if you do not introduce appeals, local Members of Parliament are going to be absolutely inundated. It was bad enough being a Member of Parliament in the past, because

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half of the cases that came up at what they call "surgeries" (I hate the word; I always use "interviews") were housing cases; now this will introduce a further factor. With all sincerity, I say to the Government, in order to give them an opportunity to think about this before we get to the Committee and Report stages, that the Government must introduce an appeals machinery in the interests of justice and of a fair deal to those worse off and affected so seriously by the Bill's proposals
To revert to the sickness benefit proposals, it is the workers who are married and with dependants who suffer most. If they are on the highest rate of sickness benefit they will be worse off by about £4 a week, and if on low pay they will be penalised by £13 a week. This fact constitutes a vicious attack on the family, and it should be remedied. I underline—and other speakers have already mentioned this—that when the wage-earner is sick, extra expenses increase; it is not all financial advantage. Take prescription charges. We know how they have risen by about 400 per cent. since the Government took office. In some cases additional heating may be needed, special diets and many other things. The wife who remains at home to care for the family and does not go to work by that fact penalises the wage-earner and his family under this pernicious Bill. The situation which I have illustrated is far worse for the low wage-earners, most of whom have few extra resources, including savings, because if you are on a low wage, even with all the scrimping and saving in the world it is a very difficult job to accumulate a few pounds—and I speak with some degree of experience in that matter in my early days.
With my noble friend Lady Jeger I am all for streamlining Government administration to create efficiency in social security services, provided that it gives a fair and reasonable deal to those whose circumstances call for help and assistance. This Bill does nothing of the sort. It is a mean and vicious measure, which means that in both the social security and housing fields many vulnerable and poor people will be worse off if this Bill proceeds unchanged. Of course, we must all recognise that we are still facing a serious economic situation and a situation which will get worse due to the present international situation. But that is no reason whatever why the poorest sections of our community should suffer from having to make a sacrifice, for in their case it is already being done. If sacrifices have to he made, and they do have to be made, then let them be made by those better off and not by the poorest of the community: the sick, the disabled and the unemployed. As has been indicated—and we on these Benches are not alone in the matter—we shall strongly contest this Bill in Committee. Unfortunately—and I feel this very much at the moment—we cannot by custom and usage vote against a Bill which has received a Second Reading in another place. However, I do not commend this Bill to the House. I regret bitterly that the Government ever introduced it.
5.11 p.m.
The Parliamentary Under-Secretary of State, Department of the Environment (Lord Bellwin): My Lords, it has become something of a tradition in this House for debates on social security Bills to be informed and interesting, and no one will suggest that this one has
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been less than interesting, although I am sure that noble Lords opposite, and especially the noble Lord, Lord Wallace of Coslany, would not expect me to agree with the sentiments that have been expressed and least of all those of the noble Lord in his last remarks. I endorse what everyone has said, that this is a Committee type Bill and it is there that we should be getting to the nuts and bolts. Also, clearly, in winding up I cannot and would not try to cover all the points made. Neither is it expected of me. Nevertheless, I will refer to some of them. I assure all noble Lords who have spoken that not only will we deal with their matters in Committee but in many instances we will be in communication with them before then so that we can either clarify for them points which they may find it useful to have in mind at Committee stage, or in some instances give them information that they ought properly to have.
I think I should begin by saying to the noble Lord, Lord Wallace of Coslany, because he implied that this was an attempt to reduce the welfare state, that I repudiate that absolutely. At present anyone who falls sick is entitled to sickness benefit from the state if he meets the qualifying conditions. Once the statutory sick pay scheme is introduced, anyone falling sick will be entitled to statutory sick pay if he meets the qualifying conditions. If he does not, he still may be entitled to state benefit. All that the scheme does is to substitute in respect of short illnesses one statutory right for another. People will be afforded the same protection after April 1983 as now.
It has been argued that it will be more difficult for an employee to get his statutory rights from his employer than from the state. That claim overlooks the fact that the vast majority of employees already get occupational sick pay from their employers. There is no evidence that this gives rise to problems, despite the fact that in most cases occupational sick pay is worth a lot more than the statutory minima laid down in the Bill. If an employer proves difficult, there are procedures to ensure that the employee gets his entitlement and penalties for the employer who has been acting in a dilatory and obstructive fashion.
The noble Baroness, Lady Jeger, criticised the scheme (as did others) as switching resources from the family to the single person. That is not the overall effect. What the scheme does financially is to divert money from those in good sick pay schemes to those with little or no occupational provisions. Why, we have been asked, is the statutory sick pay to be paid at a flat rate? The main reason is that SSP is a payment by employers and such payments do not take account of family circumstances. To compel employers to change long-standing practice would be wrong. It would be equally wrong to put employees in the position of having to give the employer personal information in order to get money. I take the opportunity to stress that someone who is sick and has insufficient resources will be able to claim supplementary benefit, so that the safety net for the family still exists.
The rates of SSP have been discussed. Some have criticised them in another place and elsewhere as too low. I am tempted to say that even if the Government had come forward with a proposal to pay full wages during sickness some noble Lords would have criticised that as being too little. I suspect that we shall come

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back to that particular matter on another occasion so I will not labour it. The noble Lord, Lord Wallace of Coslany, and others specifically said that they were concerned that the low-wage earners were being treated harshly. We thought long and hard about how to treat the low paid under the scheme and we concluded, after consultation, we should not compel employers to pay full wages to the low paid when they are sick. Many will choose to do so but they will have the discretion not to.
Therefore, we have set the middle rate and the lower rate at such a level as to provide incentives to return to work and to leave it to the employer who knows best in the circumstances to decide whether an incentive is necessary. Even after tax and contributions have been paid, someone receiving only the lower or middle rate of SSP will still get more than a single person gets by way of sickness benefit.
The noble Lord, Lord Banks, touched on the point of the hidden tax of the national insurance contribution. This Bill has been different from most other social security Bills in that the concerns expressed have not been solely about the claimants but also about the employers. It is true that employers are being asked to take on a new task. It is our objective to minimise the additional administrative burden on them. The gains to the economy through reduced bureaucracy and reduced PSBR are worth a great deal and will improve the environment in which the employers operate.
It is argued that there is a hidden tax in this, that employers have to pay national insurance contributions and the surcharge on the SSP. It has been clear since the Green Paper was published that this liability would exist. Employers cannot and I think will not complain now that they did not know of this. Taken overall, the compensation to employers under self deduction is greater than their costs by around £80 million My noble friend Lord Boyd-Carpenter stressed the importance of there not being an additional burden on the employers, least of all at this time—although some would say at any time. The point is taken and is satisfactorily covered by the proposals in the Bill. Should some of the other points he raised lead us to think that this is not so, we will look carefully at what he said. That is an overall equation.
No doubt some companies will gain from the arrangements; others will lose financially, but to a small extent. The latter group will be firms without existing sick pay schemes. They could have to find up to £5 extra for each £37 of SSP they pay out. The average sickness per employee per year is just over one week; so taking into account the waiting days, the average extra cost per employee per annum will be about £3. To excuse employers that very small sum would involve them in an administrative nightmare in calculating what they owed by way of national insurance contributions. I respectfully submit that that extra burden would more than outweigh the very small cost that they might—only that they might—have to bear. Even so, I still take the point that my noble friend made and I will deal with it as I said I would.
A point to which I would specifically like to respond which the noble Baroness, Lady Jeger, made was that unemployment benefit should not be taxed. It has been agreed on both sides of both Houses that benefits which replace income should be taxed.
Baroness Jeger: My Lords, may I make my position perfectly clear? I was not saying that the benefit should not be taxed. I was saying that benefit should not be brought into taxation while there is this 5 per cent. shortfall in the payment of unemployment benefit.
Lord Bellwin: My Lords, whether or not that point was also dealt with in another place, I am not aware. But this was discussed elsewhere and accepted in the way that I suggested. Perhaps I could move on to another point that the noble Baroness made. There is some reason to quarrel with some of the figures that the noble Baroness quoted regarding what it will cost to restore the abatement of unemployment pay; but, on reflection, that is something we had better take up on another occasion.
On housing benefits, I would remind the House that we have achieved two important policy goals. First, we have resolved the "better off" problem. The noble Baroness in her opening remarks at least acknowledged that this was a problem—and a real one— for many people. At present, many claimants are faced with the difficult decision of choosing which of the two current schemes providing help with rent and rates will give them the greater assistance. Housing benefits remove this "better off" problem. In future, claimants will receive help with rent and rates from their local authority only. Secondly, we shall be able to get the work of providing rent and rates assistance for supplementary benefit claimants done more efficiently by giving the job to the local authorities.
It always amuses me that in the many debates in which I am involved on local authorities sometimes both my noble friends and noble Lords opposite speak with such pleasure about the achievements of local government and local authorities, and sometimes they clobber them so hard that it is not to be believed. I am always faced with the dilemma on one hand of remembering that it is from there that I came, seeing some of the problems that face them, and at the same time recognising that there are shortcomings. Anyone who has their interests as much at heart as I have is the first to acknowledge that there are shortcomings. We want them to be better; we want them to be good. Everyone wants that.
Surely the noble Lord, Lord Wallace, when he expressed his dislike of the Bill in such emotive tones, must accept that if one can take £10 million of costs and translate that into the same £10 million of benefits to people, that is what I would have thought it was all about. I see on reflection that the noble Lord is nodding his approval. The DHSS will require, as has been said, 2,000 fewer staff from the change and that is a useful contribution to what the Government are seeking to do.
As the noble Baroness pointed out, although there will be the extra costs for the local authorities, and of course it will involve extra manpower, nevertheless there is a significant net gain—if I may use the term—and we have undertaken that we will fully reimburse that extra cost—and I mean fully, 100 per cent.—to local authorities. I know from conversations with the local authority associations that they have no anxieties or fears about that, as I hope that the noble Baroness does not on that point. In another place, my honourable friend the Member for Acton said—and I just

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quote briefly—that the additional costs which fall on local authorities as the result of the new scheme will be met in full by Exchequer funds. I hope that that covers that point well enough.
The noble Lord, Lord Pitt, and the noble Baroness, Lady Jeger, expressed concern at the number of losers under our proposals. It was suggested that this would have been avoided if we had put more resources into the scheme instead of introducing it on a nil-cost constraint. I think that the noble Lord mentioned a figure of £30 million. I cannot comment on that figure. I am sure he has it on good advice. I used to get the same advice. I suspect it comes from the same source and it was usually—but not always—good. One would want to check that out very carefully.
I must say that the Government do not have additional resources to spare for housing benefits. The Government's central aim must be to put the national economy straight, not least after several years of its being directed in very much an opposite direction. We believe, as I have said from this Dispatch Box so many times in the past three years, that we have to live within our means and decide our priorities on that basis.
Our overall priorities mean that we have no extra money for housing benefits. We can use the resources within the scheme to best effect, and we can use efficiency savings for benefit. But I am afraid that we cannot bring in resources from outside the scheme—whether it be new resources or savings in other areas such as that from taking the housing element out of the index used for uprating supplementary benefit.
The noble Lords, Lord Pitt and Lord Wallace, were concerned very much about the right of appeal to independent bodies. I ought to comment at least upon that because I recognise that that is a very reasonable concern to have. The Government totally support the need for review arrangements for claimants to challenge the decisions of local officers who have considered the case. But it is in the interests of everyone that these arrangements are as speedy and as direct as possible, especially as housing benefits will be a weekly benefit. The Government believe that our proposals are the most effective way of achieving that goal. I understand what the noble Baroness said about regulations and her reservations. I have had it on so many Bills now and I clearly understand what the point is.
Even so, so far as these proposals are concerned, we are intending to set out in regulations—and doubtless we shall come back to that later on—provisions whereby all existing housing benefits claimants would have the right to a review of their housing benefits determination by a committee of councillors. The Committee's decision, with reasons, would have to be given to the claimant in writing. Thus, for the first time all rebate and rent allowance claimants will be assured of a decent and detailed review if they are dissatisfied. There will also be the additional safeguard that Ministers will be keeping a close watch on this part of the scheme. We will be asking authorities to provide the DHSS with information about the number and kinds of reviews they undertake and the outcome.
I assure noble Lords that if we see particular problems arising, we shall be able to amend the regulations
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to ensure that equity prevails. There I would have thought is one instance where regulations can be advantageous rather than something which is set down firmly and finally once and for all on the face of a Bill. If we see particular problems arising, we shall be able to amend the regulations, to ensure that equity prevails.
We studied alternative proposals but found them more cumbersome or, in the case of supplementary benefit appeal tribunals, requiring significant changes in the operation and outlook of the appeal body concerned. On the other hand, our proposals offer claimants the most direct and speedy means of securing a review of their housing benefits claim from the body that can best help them—their local council. The proposals are based on ideas which have been tried and tested in some local authorities, none of which has been proved to be found wanting. They are also based on the fundamental principle, with which I hope noble Lords will agree, that councillors are best placed and must be ready and willing to intervene on behalf of their constituents to review certain decisions taken in the name of the council. The noble Lord, Lord Pitt, specifically referred to the fact that supplementary benefit claimants will lose some of their appeal rights from the introduction of housing benefits. I would argue instead that our proposals give them rights to seek a review from the most appropriate people to investigate their housing benefit entitlements; namely, the local elected members.
We shall be coming back to many of these matters before too long, but to conclude, the new scheme will involve new procedures and will require local authorities and the Department of Health and Social Security local offices to liaise more closely than hitherto. Again, discussions between the department and Local Authority Association officials have been fruitful, and the necessary procedures are being developed. I hope that I have covered at least the major points raised today, but I repeat the assurance I gave at the beginning that we will very carefully check over everything that has been said and I will have regard to the points I have not covered.
I should like to conclude by saying just a word about the merits of the measures in this Bill. As my noble friend Lord Elton said earlier, they are aimed at reducing wasted effort. The sick pay scheme will cut dramatically the overlap of work between employers and the state when someone is sick for short periods. The housing benefit scheme will not only remove a lot of confusion and unnecessary work from staff but it will also reduce the confusion for claimants by replacing two schemes for financial help with housing costs by one scheme. The overall effect of the Bill is to reduce civil servant manpower by around 6,000, and that is an important contribution to the Government's objective of reducing the size of the bureaucracy.
I conclude by saying that, despite the real concern expressed by noble Lords opposite, I hope that as we go through this they will recognise many parts of the Bill which even they will feel are an advance on present procedures. The Government think so—as your Lordships might expect. I believe myself that this is a fine measure and a good Bill. It will take us much

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further along the road towards doing things in these areas better than we do them today.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Industrial Relations (Northern Ireland) Order 1981
5.33 p.m.
Lord Elton: My Lords, in the absence of my noble friend Lord Gowrie, I beg to move that the House do approve the draft Industrial Relations (Northern Ireland) Order 1982, which has been laid before the House under the Northern Ireland Act 1974. Many in this House will recognise the subject matter of the order, which largely enacts the provisions of the Employment Act 1980 in Northern Ireland. It is now a year and a half since we debated the Employment Bill in this House and noble Lords will no doubt be relieved to hear that I intend to be considerably more selective in my comments tonight than it was possible for my noble friend to be on the earlier occasions.
Industrial relations is a transferred matter. The separate body of legislation on this subject which existed before direct rule has been added to since then by orders-in-council. Historically, the Northern Ireland legislation in this field has been basically similar to that in Great Britain and it is Government's view that Northern Ireland industrial relations legislation should continue to reflect Great Britain's advances. We are, however, fully conscious that all the local Northern Ireland considerations are taken into account and, in discussions with the Province's industrial relations partners, made that point clear. In pursuance of this policy the Government fully consulted on its proposals in Northern Ireland. Perhaps the most significant result of these consultations is the decision to retain statutory provisions relating to the recognition of a trade union. We have accepted the argument that the Northern Ireland provisions incorporate greater flexibility and have not proved as unsatisfactory as the Great Britain provisions now repealed by the Employment Act 1980. In addition this Order carries amendments to the Wages Council Act (Northern Ireland) 1945.
I now propose to review briefly the main provisions of this order. First, as to trade union ballots and codes of practice which are covered by Articles 3–5, in recognition of the Government's view that greater use should be made of ballots in conducting trade union affairs, these provisions enable the establishment of a scheme for the reimbursement to independent trade unions of the cost of secret ballots and require employers to provide facilities for the conduct of ballots in certain circumstances. It is currently envisaged that the reimbursement scheme will be administered by the Labour Relations Agency.
Article 5 enables the Department of Manpower Services, after consultation, to issue codes of practice containing practical guidance for promoting the improvement of industrial relations. Noble Lords will be aware that two such codes of practice on picketing and on the closed shop have been issued in Great
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Britain. Consideration is being given to similar action in Northern Ireland, but no decision will be taken until full local consultations with the Labour Relations Agency and others have been completed.
Articles 6 and 7 contain provisions on exclusion from trade union membership. These articles provide protection for employees in situations where the closed shop operates by enabling them to seek compensation through the industrial tribunals should they be unreasonably expelled or excluded from membership of a trade union. In addition, under the heading of "unfair dismissal", Article 8 widens the grounds on which dismissal from employment for non-membership of a trade union is unfair where a closed shop agreement exists. In particular, dismissal would be automatically unfair where the individual generally objects to membership of any union, or a particular union, on the grounds of conscience or other deeply held personal convictions. At this point I should like to mention that Article 17 provides employees with similar rights where action short of dismissal is taken against them aimed at compelling them to join a trade union. Should an employer feel that he was induced to dismiss a complainant for non-membership of a trade union then that employer, under provisions of Article 12, may join as a party to unfair dismissal proceedings a person, union or contractor whom he claims is responsible.
The remaining provisions under the "unfair dismissal" heading—that is Articles 9, 10 and 11—amend the requirement concerning the onus of proof in unfair dismissal cases. They provide that in deciding whether dismissal was fair a tribunal should take into account the size and administrative resources of the employer, they ease the burden on small employers by exempting firms with less than 20 employees for two years and make certain changes to the basic award element in assessing compensation for unfair dismissal. As a result of representations made during the consultations in this legislation we have taken steps to exclude the employees of small voluntary schools from the small firms exemption in order that they might have parity with their colleagues in the controlled sector.
Articles 13–15 are concerned with maternity rights. Article 13 amends the existing provisions about giving notice of absence for maternity and exercising the right to return. Article 14 relieves employers of five or fewer employees, with the exception, again, of voluntary schools, of the obligation to reinstate an employee after maternity leave, and that relief is extended to all employers where it is not reasonably practicable to reinstate the woman in her original job and an offer of suitable alternative employment is made. I am particularly pleased that Article 15 of this draft order introduces a new right for pregnant employees to have reasonable time off with pay to receive ante-natal care. I know that it has been the practice of many good employers to provide such a facility in the past, and we sincerely hope that its extension to all employees will be of advantage to them.
Article 16 amends the calculation of guarantee pay by changing from fixed calendar quarters to a more sensible system, under which there will be entitlement during a rolling period of any three months. The provisions in Articles 18 to 21, falling under the heading of Restrictions on Legal Liability are concerned with

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limiting secondary industrial action. The purpose of the Articles is to limit the immunity from actions in tort granted to individuals to those situations in which they have a direct interest. Article 18 therefore provides a new definition limiting lawful picketing in contemplation or furtherance of a trade dispute to a person picketing at or near his own place of work. While providing safeguards in respect of trade union officials, the provision will give employers afflicted by the "flying picket" the ability to seek an injunction to stop such picketing.
Article 19, which I admit is rather complex, in essence limits lawful secondary action to action taken within a cordon of first suppliers and customers of an employer in dispute. Where secondary action not falling within the definition of lawful secondary action takes place, then, once again, an employer may seek an injunction or damages in the Court where the action complained of brings about a breach in a commercial contract. Nothing in these provisions is aimed at removing the accepted right of trade unions to take industrial action in support of members directly affected in a dispute with their employers.
Article 21 has no counterpart in the Employment Act, but is in response to representations made in Northern Ireland to bring the wages councils legislation there more into line with Great Britain. There are three main amendments. First, wages councils will be empowered to make their own wages regulation orders, which in the past have been made by the Department of Manpower Services. This will bring wages councils into line with their Great Britain counterparts and with the Agricultural Wages Board. Secondly, the amendments will enable such wages regulation orders to become effective immediately upon the expiry of a statutory 21-day objection period, even if this involves an element of retrospection. Finally, the Department of Manpower Services will be enabled to refer questions about the operation of individual wages councils, or the system as a whole, to the Labour Relations Agency for a report and recommendations. Articles 22 and 23 provide for repeals of Northern Ireland legislation analogous to the repeals made by the Employment Act with the one notable exception which I have already drawn to the attention of noble Lords; that is, that we shall retain the statutory trade union recognition provisions in Northern Ireland.
Before closing, I should like to acknowledge that one of the many attractive features of Northern Ireland for potential investors is a proven record of good industrial relations. I do not believe that the changes envisaged in this legislation will in any way affect that situation, as it seeks to deal only with the most damaging abuses which may occur. It also is the Government's view that it would not be in the interests of any of the industrial relations partners in Northern Ireland to have significantly different basic rights and responsibilities in these matters from the rest of the United Kingdom. I, therefore, on behalf of my noble friend Lord Gowrie, who will reply to this debate with much greater facility than I could, commend these proposals to the House. My Lords, I beg to move.
Moved, That the draft order laid before the House on 20th October be approved.—(Lord Elton.)
The Minister of State, Northern Ireland Office (The Earl of Gowrie): My Lords, before the noble Lord, Lord Blease, gets up, I should like to apologise to the House for not being in my place as I should have been. I was advised that this order would come on substantially later. But it was my responsibility and I am most sorry. I should also like to congratulate my noble friend on the brio and clarity with which he delivered the brief at very short notice.
5.45 p.m.
Lord Blease: My Lords, may I thank both the noble Lord and the noble Earl for their explanatory outline of this order. I join with the noble Earl in complimenting the noble Lord, Lord Elton, on his versatility in stepping into the breach. As the noble Lord has indicated, this order will introduce into Northern Ireland's industrial relations legislation the main provisions of the Employment Act, which was enacted in 1980 for Great Britain. The noble Earl and the Northern Ireland Secretary of State, Mr. James Prior, in their previous ministerial offices, both played leading parts in steering the Employment Act 1980 in its passages —rough passages, in my opinion—through both Houses.
Since the noble Earl's appointment as deputy Northern Ireland Secretary of State, he will be aware of the separate and distinctive features of trade union structures and organisation in the Province, and the marked differences in industrial relations procedural arrangements. The noble Earl will also be aware of the considerable concern about the order which has been expressed by many in Northern Ireland who are directly involved in manpower matters and industrial relations, and especially the pronounced opposition to the order which has been repeatedly made during the past 12 months by the central trade union organisation; that is, the Northern Ireland Committee of the Irish Congress of Trade Unions.
Noble Lords will have noted that this order was debated in another place in the early hours of Wednesday, 24th March, when, after a Division, it was approved. Therefore, for the reasons which I have outlined I do not propose to raise in detail the contentious issues which are contained in the 23 Articles and 3 Schedules of this order, and which are well-known to the Government as they have already been debated at some length. Therefore, I propose to confine my remarks to a few pointed, but not argued, comments and questions which should make clear our views and the reasons why we on these Benches are opposed to the order.
I repeat that Northern Ireland has its own separate legislative and administrative framework of industrial relations. The record of good industrial relations in the Province has been widely referred to by Ministers, and by others directly concerned in promoting Northern Ireland's industrial development interests throughout the world. Even within the last few days, the Northern Ireland Secretary of State, Mr. James Prior, referred to this record when he spoke at St. Anne's Cathedral, Belfast, on 31st March. Mr. Prior was speaking to the subject, "Our responsibility to our community" and he was dealing with a number of matters, including the economy, social welfare and politics. During his

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address, he stated—and I quote directly from a paragraph in the text of the address—
"I have a number of things in mind. The first is industrial relations, which is something I have been concerned with for very many years. Industrial relations in Northern Ireland are by no means perfect and there is much which can be done to improve them. But that said, the truth is that Northern Ireland has one of the best records of industrial relations of anywhere in Europe. Its record is certainly much better than that for the rest of the United Kingdom. This does not mean that one side has managed to dominate the other. It means that there is a degree of understanding of the nature of the problems, and a willingness to work constructively for their resolution, which is all too often lacking in other places. The way in which people learn to co-operate together at their place of work is one measure of the maturity and tolerance of a community. People who criticise Northern Ireland for its violence, or because they believe that it is peopled only by bigots, would do well to note this and perhaps to learn from it".
I have never held that Northern Ireland trade unionists, or management, are any more industrially virtuous than trade unions and management in other parts of these islands, but I am convinced by experience that the lines of communication in Northern Ireland, and the industrial procedures, enable manpower and industrial relations matters to be dealt with more speedily, effectively and efficiently, not only because the lines of communication are much shorter and more direct but also because we rely much more on the good sense, knowledge and expertise of the practitioners than on legal sanctions and edicts of law.
I would not detract one word from the statement of Mr. James Prior which I have quoted. He re-echoes the views expressed by many in Northern Ireland commercial and industrial life, including civil servants—persons who are knowledgeable about modern industry and dynamic and positive management-trade union relationships. Northern Ireland has many real attractions and incentives for industrial investment. Good industrial relations is one of them, upon which we should attempt to capitalise at every turn and at every event.
It is my opinion, and I believe it is the opinion of many others, that it would be disastrous if this record of good industrial relations were to be tarnished or impaired as a result of the introduction to Northern Ireland of legislation which is neither indigenous nor necessary. Past experience in Northern Ireland indicates that it is best that the various industrial interests should be enabled to work out the industrial procedures appropriate to the needs of the Province. Many of the provisions in the order are irrelevant to Northern Ireland's needs. Some of them could be seriously harmful. Perhaps I may quote a few examples. The balloting provisions could be used to further sectarian ends. This is particularly true of ballots on union constitutions and on the elections for officials and committees. The trade union movement has been an oasis of tolerance in a desert of sectarianism. It is, I believe, up to everybody, including the Government, to preserve and nurture this oasis.
In over 40 years of trade union activity in Northern Ireland I have not experienced or heard of a single case of a worker being dismissed as a result of a closed shop agreement. Now we are legislating for a closed shop and for compensation. Could we be tempting fate unnecessarily? Could we be in some way encouraging a way of stepping out of the existing relationship that obtains in Northern Ireland so far as
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closed shop arrangements and agreements are concerned? The picketing law in Northern Ireland has been for some time different from that of Great Britain. Two recent cases prove that any problem of illegal picketing, including flying pickets (which are not a feature of Northern Ireland industrial life), can be quickly remedied by the courts under existing Northern Ireland statutes.
I should like to put a few questions to the Minister which I believe are relevant to the attempt to legislate in this particular field. May I ask the noble Earl whether this order will contribute one iota to a much needed investment programme? Will one extra job be created by the implementation of this order? Are there not already signs that the implementation of this order as it stands will have a disruptive and a negative influence on industrial relations in the Province? May I ask the Minister whether it is a fact that the Government have recently agreed to set up a joint working party, representative of employer organisations, the trade unions, the Department of Manpower Services and the labour relations agency? If this is so, surely this body should be given every opportunity to examine Northern Ireland's industrial relations needs before any new legislation is put into effect.
Finally, may I say that, along with the noble Earl yesterday, we attempted to bring forward a step in the political development of Northern Ireland. The United Kingdom Government are adjuring politicians to come together and tackle Northern Ireland's serious industrial and economic problems. Along with others I have publicly supported and worked for these declared aims. Surely it would be in keeping with this approach to encourage employers and trade unions to get together and work out an industrial relations strategy which would help to attract new industry and assist existing industry.
May I invite the noble Earl the Minister to continue to use his good offices and his influence, even at this stage, towards the particular ends which I have mentioned. Even at this stage I believe that it is possible in some way to put a moratorium on the legislation as it is and to move forward in a co-operative way towards producing in Northern Ireland dynamic, positive industrial relations procedures applicable to the needs of Northern Ireland. As I have already indicated, we on these Benches are opposed to the order. However, in upholding the conventions of this House we do not propose to divide the House on the Motion to give approval to the order.
Lord Hampton: My Lords, I was going to thank the noble Lord, Lord Elton, for so ably introducing the order and welcome him back to the Dispatch Box, but he has disappeared. Nevertheless, we are grateful to the noble Lord for introducing the order in the noble Earl's absence.
Whatever else may be wrong in Northern Ireland, it seems to be accepted on all sides that industrial relations are generally very good. Unfortumately, the high level of unemployment may have a lot to do with this. It is tragic that when employment is easy to come by a mad scramble for higher wages is apt to develop. When the recession ends I am not clear how the Government will deal with this in the United Kingdom as a whole, but that is outside today's debate.

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I believe it makes sense that the law in Ulster should in general be brought into line with the situation in the rest of the United Kingdom, as it has been since the enactment of the Employment Bill in 1980. I have noted what the noble Lord, Lord Blease, has said, but I do not agree with the argument that this order may lead to a deterioration in industrial relations. My party largely supported the Government over the Employment Act 1980, guided by common sense together with a desire, as always, to protect the liberty of the individual. I will briefly run through the provisions of the order.
The arrangements for trade union ballots remove a financial burden without in any way making ballots compulsory. I cannot see any grounds for complaint here, despite what the noble Lord, Lord Blease, said about sectarian problems. The codes of practice to be issued by the Department of Manpower Services are described as "containing practical guidance for promoting the improvement of industrial relations". Nobody could, surely, disagree with at least this aim.
Then there is the ending of the closed shop and the threat of dismissal for not joining a union. This is a potential subject for major debate. I will just submit that in principle the individual should be allowed to decide for himself. It seems to be eminently reasonable that pregnant women should be allowed paid time off to undergo ante-natal treatment, though it is perhaps sad that such a provision has to be enacted.
Lastly, in this brief survey, we have the measures to deal with the problems of secondary picketing, flying pickets and secondary industrial action. The winter of discontent under the Labour Government showed a considerable abuse of powers by some of those organising either official or unofficial strikes.
Lord Blease: My Lords, not in Northern Ireland.
Lord Hampton: My Lords, I am talking about this country at the moment. I do not oppose the provisions in this order to check such action. At the same time, I am sure it is vital that rewards for labour are fairly distributed and are seen to be so. That also, of course, can be the subject of a further major debate. In summary, I repeat that we believe this order is reasonable.
Lord Donaldson of Kingsbridge: My Lords, from this Bench we have never yet differed on a vote with my old friend and colleague Lord Blease. I am very glad that he is not taking this to a vote because, if he did, I should have to differ from him. The only objection to this order that I can see is the objection held that any legislation about trade unions must be wrong. We do not share that view. We believe that trade unions should be as near as possible to the same position as other people with certain well-established exceptions which no one is trying to alter—such as the right to strike, and so on.
To take these matters one by one, there is the assistance to trade unions to ballot, there is some reservation about the closed shop, there are the fairly generous arrangements about unfair dismissal, and there are the excellent arrangements for maternity. These are all things which cannot be objected to by
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anyone. The picketing laws may possibly be objected to by some but they are not objected to by us. We are very happy to support the order and are very glad that there is to be no Division on it.
6.2 p.m.
The Earl of Gowrie: My Lords, may I make a general welcome to the way in which the order has been received. It is with a very peculiar sense of déjà vu that I am here at this Dispatch Box on matters such as secondary action, secondary picketing, secret ballots and the rest, and in a Chamber graced at the moment by the presence of my noble and learned friend on the Woolsack and also the noble Lord, Lord Wedderburn, on the Labour Back-Benches. One might almost be sleep-walking back into the dear, dead days of 1981.
I would like to clear up one thing. As the noble Lord, Lord Blease, very fairly pointed out, the Government have always emphasised the great strength of the industrial relations tradition in Northern Ireland. I might just say to the noble Lord, Lord Hampton, that industrial relations, measured in terms of the number of strikes or stoppages, were considerably better in Northern Ireland than on the mainland, even during periods of far fuller employment. There is a different tradition—and, in fairness, there are altogether different problems—in Northern Ireland.
Taking up a remark made by the noble Lord, Lord Donaldson of Kingsbridge, we are concerned in this legislation—as we were concerned in the parent legislation, if I may so put it, a year or more ago—with common sense and the liberty of the individual. I do not believe that even our sternest critics, who are at any rate professionally disinterested, have thought that the Employment Act 1980 was especially draconian. The great question this evening is not the principles of the Employment Act 1980, but whether it is wise that there should be a divergence between legislation in this field which is on the statute book for the United Kingdom as a whole and that which applies in Northern Ireland.
It is the view of the noble Lord, Lord Blease (and he is very experienced and respected in this field in Northern Ireland), that we could bring down a guillotine or moratorium to "freeze" things there for a time and perhaps examine the question. This is just the kind of action that a devolved Assembly could put to the Government to take. The Government believe that it is much better that the law in both parts of the Kingdom should be in line. No one should read into my remarks that we are setting up this legislation in Northern Ireland in order to encourage people in Northern Ireland to try to dissemble or undo it. We are not thinking of that at all. But it is interesting that given the different traditions of Northern Ireland there could be opportunities for dealing with the transferred matter in this way.
The noble Lord, Lord Blease, made, with great respect, the old point about whether any jobs would be created by this kind of legislation. I do not believe that jobs are exactly the issue here. I go back to the phrase used by the noble Lord, Lord Donaldson of Kingsbridge, about common sense and the liberty of the individual. Northern Ireland has a very grave unemployment problem and the noble Lord will know that we are trying all we can to improve the situation substantially, but that will take a lot of time. There

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could be difficulties though, particularly in terms of our attempts to attract external investment there, in having to deal with a totally different set of industrial relations, laws and procedures than apply in the rest of the Kingdom.
In closing, I would like to repeat my apology at the outset for my blunder in not being able to introduce this matter into your Lordships' House. With the caveat given to us by the noble Lord, Lord Blease, which I have to reject but which could be taken up in the Province itself at a later stage, if the appropriate structures were there, generally, I welcome the way in which the order has been received and recommend that it move through your Lordships' House.
Lord Wedderburn of Charlton: My Lords, while welcoming back the noble Earl, whether with a sense of déjà vu or not, I wonder whether he would care to add any remarks that might reassure the trade union movement in Northern Ireland that, although this parent legislation had to be spawned across the sea, the Government foresaw no future course of action of that kind?
The Earl of Gowrie: My Lords, I missed the last part of the noble Lord's question. What was it that "the Government foresaw"?
Lord Wedderburn of Charlton: That you will not do it again, my Lords.
The Earl of Gowrie: My Lords, I will not give any hostages to fortune in general, and to the noble Lord, Lord Wedderburn, in particular.
On Question, Motion agreed to.

Administration of Justice Bill [H.L.]
6.8 p.m.
The Lord Chancellor: My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(The Lord Chancellor.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD AMPTHILL in the Chair.]
Clauses 7 to 8 agreed to.
Clause 9 [Services to injured person's relative]:
The Lord Advocate (Lord Mackay of Clashfern)The Lord Advocate (Lord Mackay of Clashfern) moved Amendment No. 18:
Page 8, line 1, leave out ("subsection (2)") and insert ("subsections (1) and (2)").
The noble and learned Lord said: This is a minor drafting amendment which is needed to reflect the fact that subsection (3) is applicable to both subsection (1) and subsection (2) of this clause. I beg to move.
On Question, amendment agreed to.
Clause 9, as amended, agreed to.
Clause 10 [Assessment of damages for personal injuries]:
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 19:
Page 8, line 32, leave out ("section 8") and insert ("section 81").
The noble and learned Lord said: This is another small drafting point to correct the reference in the Bill to the Employment Protection (Consolidation) Act 1978. If the amendment is not made, instead of referring to the right to redundancy payments, as is the intention, the subsection will refer to every employee's right to have a wages slip—or more properly, an itemised pay statement—showing detailed deductions and gross and net pay. I beg to move.
On Question, amendment agreed to.
Clause 10, as amended, agreed to.
Clauses 11 to 13 agreed to.
Clause 14 [Amendment and repeal of enactments]:
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 20:
Page 10, line 33, at end insert (",and—

(a) in section 4 of that Act the words "but this section is without prejudice to section 5 of this Act" shall cease to have effect, and

(b) in section 6 of that Act—

(i) in subsection (1) for the words "section 5 of this Act" there shall be substituted the words "this section", and
(iii) after subsection (2) there shall be inserted—
"(3) This section applies to any action in which, following the death of any person from personal injuries, damages are claimed—

(a) by the executor of the deceased, in respect of the injuries from which the deceased died;

(b) in respect of the death of the deceased, by any relative of his.".").

The noble and learned Lord said: This is a moderately complex drafting amendment to ensure that the repeal of Section 5 of the Damages (Scotland) Act 1976 is properly reflected in Sections 4 and 6 of that Act. It first removes a redundant reference to Section 4 and then also takes the two categories of action specified in subsection (1) of Section 5—namely, where damages are claimed by the executor of the deceased in respect of the relevant injuries or in respect of the death of the deceased, by any relative—and incorporates them as a separate subsection of Section 6. It should then be clear that the provisions in the section limiting the total amount of liability relate only to the categories in the new subsection. In effect, the amendment does no more than restate Section 5(1) of the 1976 Act in Section 6. I beg to move.
On Question, amendment agreed to.
Clause 14, as amended, agreed to.
Clause 15 [Interest on debts and damages]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 21:
Page 10, line 36, leave out ("sections") and insert ("section").
The noble and learned Lord said: If I may, I will speak to Amendments Nos. 21 and 22 and Nos. 58 to

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70A inclusive. It is rather a formidable list, but really there is nothing much in them. The amendments to Clause 15 and Schedule 1, to which I am speaking, shorten and clarify the new scheme for awards of interest in the High Court and the county courts. As regards the amendments to Clause 15, these are consequential upon the changes made in Schedule 1, whereby one section is inserted in the Supreme Court Act 1981 and one in the County Courts Act 1959, instead of two in each, as at present.
The amendments to Schedule 1 on page 40, at lines 6, 9 and 31, produce a very much simpler and shorter version of subsection (1) of the new Section 35A which is to be inserted in the Supreme Court Act 1981.
The amendments on page 40 at line 34 and on page 41 at line 14 incorporate the substance of Section 35B within the body of Section 35A in a much simpler, shorter and clearer form. Page 41, lines 17 to 38, which are taken up with Section 35B, are then ommitted.
The amendments starting at Page 41 at line 42 and ending with page 43 at lines 4 to 27 remodel the new Section 97A which is to be inserted into the County Courts Act 1959, so as to give it the same shorter, clearer and simpler form as is given to Section 35A of the Supreme Court Act 1981 by the amendments I have already referred to. I beg to move Amendment No. 21.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 22:
Page 11, line 1, leave out ("sections") and insert ("section").
On Question, amendment agreed to.
Clause 15, as amended, agreed to.
Clause 16 [Interest on lump sums in matrimonial proceedings]:
On Question, Whether Clause 16 shall stand part of the Bill?
Lord Renton: I have a very short point. I wonder whether my noble and learned friend can help. Clause 16 deals with the interest which is payable on sums which the court orders should be paid into court. They would be lump sums. I believe it has always been the practice so far that only simple interest should be paid, but, in these days when interest rates are fairly high and when the sums are quite considerable, and there may be a delay in the payment into court, I am wondering whether there is not a case for payment of compound interest.
The Lord Chancellor: This has been considered, and I think I am right in a saying that we thought there was not a case for the payment of compound interest.
Clause 16 agreed to.
Lord Stanley of Alderley Lord Stanley of Alderley moved Amendment No. 23:
After Clause 16, insert the following new clause:
(Certain contract debts to carry interest.
STATUTORY INTEREST ON CERTAIN CONTRACT DEBTS
.—(1) A relevant contract debt shall carry simple interest by virtue of this section and in accordance with sections (Relevant contract debts etc.) to (Assignments etc.) below.
(2) In this Act "statutory interest" means interest carried by virtue of this section.").
The noble Lord said: With the permission of the Committee, I should like to speak to Amendments Nos. 23 to 31. Last week, I felt rather like Daniel having a look at the lion's den of noble and learned Lords. I was prevented from plunging in by my noble and learned friend the Lord Chancellor. Today I intend to go in, because I hope very much that—like Darius, I think—the Government will be converted to my views on the merit of my amendment, which I must tell them has much more logic and lies much more easily in the Bill than the one I moved last Tuesday. I think my noble and learned friend was saying last Tuesday that my amendments then did not lie very easily in the Bill, with which I have partly to agree.
The purpose of this amendment is two-fold: first, to place the small trader on more equal terms with the large or multinational firm with regard to interest on debts; and, secondly, to keep the courts empty or at least free them from having to deal with endless cases of debt. The Law Commission in its Report No. 88 on interest in June 1978, suggested this course of action, and I was interested to read my noble and learned friend's speech at Second Reading, when he referred to the problem of interest in column 30. He said that the Bill would, "remedy what I regard as a serious injustice".
However, for reasons that are not apparent—they may be apparent to my noble and learned friend and other noble Lords—the Bill in Schedule 1, Parts I and II goes only half way to implementing the Law Commission's report. The result of this half-baked approach, which is very common with any half-baked approach in life, will be to place the small trader in a worse position than he was before, in that he will have to take his debtor to court to get payment of interest on his overdue account. This will put more people before the courts—a bad idea, as I am sure my noble and learned friend would agree. Worse still, the large company is much happier in court, with all its legal resources at its disposal, than I am with none, and with no time and no experience anyhow. I go so far as to say that if the Government cannot go along with the whole of the Law Commission's report, which is what my amendment achieves, we should be better off scrapping Clause 15 altogether. We may have to think about that later if my noble and learned friend cannot help me.
At this stage, I will not bore the Committee with the details of my amendments. I know that my noble and learned friend understands them so much better than I. I truly hope that the Government will accept in principle my case, if not my particular amendment. My amendment would mean that there would be a statutory right to interest on overdue accounts without the need to appear before the court. The length of the amendment is due, if I may say so, to the lawyers having a field day over what is to me a comparatively simple point. The amendment ties up the knots. For instance, it spells out, among other points, what contract debts are covered, the position of the debt where there is a statutory provision, the position of tenants under leases, the position of bills of exchange, the tax provision problems, how why and at what rate interest shall be charged. On that matter, I should say to my noble friend Lord Renton that we have gone for simple interest and not compound

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interest, though we have argued this on compensation and, sadly, have always lost it.
I referred earlier to the amendment correcting the Bill's half-baked approach to the problem. It might have been better if I had said that it appears to me that my noble and learned friend started darning this particular sock, but then left a gaping hole like a potato in it. Therefore, I very much hope that my noble and learned friend will be encouraged by my amendment to take up again his needle and thread and accept the principle of my amendment which, at the end of the day, would help me as a farmer and small trader to be more efficient and effective by giving me—I repeat—the right to interest on overdue accounts, and prevent me from filling his courts in order to get it. I beg to move.
Baroness Sharples: I also should like to draw the Committee's attention especially to the section of our amendment under which the right to statutory interest on unpaid contract debts would he treated as if it had been provided by the contract. That should, as my noble friend has said, help the small trader who very often has great difficulty in obtaining payment, especially from large companies and understandably, as my noble friend has said, they are very reluctant to go to court. They simply do not have the time. They cannot afford it. This amendment would help them and it seems fair to all concerned, because very many debtors do not settle their accounts before 90 days. That is quite intolerable because it affects the small trader's cash flow.
At the moment there are a number of small traders who, on their invoices, state that a surcharge of 2½ per cent. per month may be added to overdue accounts. I happen to know that that produces results—I have heard from people who have been in touch with me. However, it has no standing in law. I believe that our amendment would assist small traders and, as my noble friend said, the more people we can keep out of the court seeking redress, surely the better?
Lord Renton: I should like to give a brief word of support to my noble friends. There is no need for me to repeat the arguments which they have put forward. However, I should just like to add that there has been very careful consideration of this matter by the Law Commission presided over by one of Her Majesty's judges. I think that we are entitled to know why it is that, in producing this Bill, my noble and learned friend has been somewhat selective and has not accepted the whole of the package which the Law Commission put forward. There may well be a good reason for that, but, unless there is, I would have hoped that this is a matter that perhaps my noble and learned friend would wish to consider further.
Lord Mishcon: I wonder if, before the noble and learned Lord deals with the arguments, I may add just a word in regard to this amendment which certainly we on this side would be happy to support? We have in mind the small trader and we know of conditions which have existed over the past few years—and which certainly are current—where, of course, the cash flow is life and death very often to the small trader. All of us have looked with the greatest of apprehension at the
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number of failures that there have been of small companies and small businesses. Many happen, of course, every week. The statistics from the beginning of this year are especially alarming in that connection.
This does seem to be a non-controversial item and one bears in mind with the greatest of sympathy and understanding what the noble and learned Lord said about the hoped for passage of this Bill which might be interfered with if we dealt with controversial matters. I cannot conceive with respect—if I may repeat myself —that this is a controversial item. It seems to clear up the matter of interest. if I may say so, as any decent practising lawyer would, we sympathise completely as a profession with those who wish to keep out of the courts, and a decent practising lawyer sees that that happens if ever he can.
Lord Monk Bretton: I should like to say a few words in support of the amendment because I believe that this matter needs the most careful consideration of the Committee. I think that the smaller firms will always remain afraid to sue in any case and, therefore, they will be afraid again to sue for interest under the clause that is in the Bill, as my noble friend Lord Stanley pointed out, because they fear for their loss of goodwill and loss of customers. I also believe that this is a bad thing for the public because, faced with those who do and do not pay, what does the trader do?—he covers himself. The good payer in the end has to pay for the bad payer. For that reason I believe that it would be very much better for there to be statutory interest on debts. I know that there is, of course, a vested interest—the vested interest of those who do not pay. But it cannot be said that this is good for efficient trade.
I understand that in the United States they have statutory interest on debts and that that is also the case in most European countries. So, bearing in mind the inflationary experiences which we have had, it seems that this matter is rather overdue for remedy and should be dealt with. I think that it is the job of the Committee to consider supporting the smaller firms as regards this matter. Let us now, if we possibly can, make some progress for the good of all because so many other countries have this law. Finally, I should like to raise one other matter because we are dealing here with a long series of amendments. I wanted to hasten to say that I believe that it is much simpler in practice than it looks and that in fact it could work well.
Lord Hylton: If it were helpful I could provide evidence, given a certain amount of notice, of both large commercial companies, whose names are very well known to the public, and of Government departments, who regularly take 90 days and sometimes a little more to settle their accounts. On those grounds I should like to support the amendment and I very much hope that the Government will take it very seriously and give it their full consideration.
6.29 p.m.
The Lord Chancellor: My noble friend Lord Stanley of Alderley likened himself to Daniel in the lions' den. I am afraid that I am cast for the role of Darius. If my noble friend will recollect, Daniel emerged unscathed from the lions' den. He emerged unscathed because the king on the following morning said, "Daniel, come

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forth". I am afraid that I am cast for the role of saying to Daniel, "Come forth". I must tell my noble friends that I have given the most careful consideration to all these permutations and combinations of what I might and might not have put into the Bill. I got the maximum out of my colleagues on the terms which it is now becoming rather wearisome to repeat. But the fundamental condition upon which I got anything was that I should not generate too much controversy either between parties or between vested interests of one sort or another.
There are, in fact, as we have heard, a number of quite powerful arguments for the provision of interest on simple contract debts. The draftsmanship, of course, is impeccable because I think it comes from the Law Commission and not from my noble friend. But I cannot take carriage of it on this Bill, and I really must appeal for support to the Committee about the line of policy which I have been trying to carry through because I do need this law reform. I say this particularly to the noble Lord, Lord Mishcon, but I say it also to my noble and learned friends and my noble kinsman on the Cross-Benches. Being the guardian and the trustee, as I think I am, of the work of the Law Commission, I always try to see what I can do to legislate on Law Commission reports. Naturally enough, the matter was processed through various departments and various consultations.
The fact is that a number of institutions—and I shall enumerate them—were very much against the idea. Others were very much in favour of the idea, and neither would yield to the other. Very much against the idea were the CBI—and it would take a great deal more than me to overcome them (under their leadership, we hear that they are always spoiling for a fight with the Government)—the National Chamber of Trade, the Federation of Civil Engineering Contractors and accountancy bodies. The same was true of most, though not all, of the consumer organisations.
That is what I should have to face if I were to include this particular set of provisions in the Bill. If I had to face that, in my opinion, I should quite certainly lose the Bill. I do not in the least take sides in this matter—at least, I may do, but I shall try to conceal the side that I take.
On the other side there are, equally, a number of very powerful and very reputable bodies: the National Farmers' Union—and I rather fancy that my noble kinsman may have been stimulated into oratory from that quarter—the Association of British Chambers of Commerce and, as the noble Lord, Lord Mishcon, probably knows, the Law Society. They were all very much in favour of the Bill.
It is perfectly fair to say there are very powerful arguments on both sides. But, having put it to my colleagues and taken their advice, the Government's decision was that I could not include this, at any rate in this Bill. As a matter of fact, as long ago, I think, as 1980, there was a public announcement by the Government that the policy could not be accepted. But I do not want to dogmatise on this subject, because my humble function in promoting this Bill has been to get the maximum amount of law reform that will go into the quart pot that I was given. This enormous set of amendments, which will be very highly controversial
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—though not, I think, on party lines at all—will, in fact, overload it.
I am sorry to have to say that to my noble friend, because I know how very unsatisfactory this sort of answer is when it comes from Government Ministers. But it is given in good faith; it is given firmly, and I must say that I am not prepared to accept the theory that this is in any way half-baked. We have taken the proposals of the Law Commission, in so far as they deal with the subject of the Law Reform (Miscellaneous Provisions) Act 1934, and sought to implement them. It is true that we have not accepted the other and controversial proposals, the size of which can only be seen by looking at the Marshalled List, because it is quite clear as a matter of parliamentary fact that, if you put these enormous clauses in this Bill, the opportunities for those who dislike them to delay the Bill by amending them and resisting them, stage by stage and line by line, will be almost insuperable.
Therefore, I say to my noble friend, "Daniel, come forth. You may have another day, but please don't stay in the lions' den and blame me entirely for not accepting this very formidable additional burden to this already monstrously long and complicated Bill". I say that without passion because it may be that at some stage or another I have shown a degree of sympathy with the thinking behind the amendments, but I simply cannot do it. So far as I am concerned, that is all I can tell the Committee. I can only apologise for being so intransigent, but there it is.
Lord Renton: I am sure that we sympathise with my noble and learned friend and are grateful to him for his explanation of his own problems. But, speaking for myself, my sympathy would be very greatly increased if he could tell us, in broad terms, what were the grounds of objection on the part of the CBI and others whom he named who did object. I would just add the relevance of our knowing that: it is because, although the matter was considered rather controversial outside Parliament, I tend to agree with the noble Lord, Lord Mishcon, who indicated that in your Lordships' Committee that it would not be controversial to accept these amendments, and I find it very hard to believe that it would be controversial in another place. If my noble friend has to accept clauses which occupy another page or two and it is found that they are not controversial, I should have thought that he would be doing his Bill no harm, nor spoiling its chances of getting onto the statute book.
The Lord Chancellor: I do not want to enter into a long argument about the desirability or otherwise of charging interest on simple contract debts. But, broadly speaking, the departments of Government sponsor these various bodies and put forward the arguments which those bodies themselves have already embraced. I can assure my noble friend that the result of pressing this would be exactly what I have said, neither more nor less.
But the charging of interest, where you have not agreed to pay it or where terms have been that you pay a given sum of money, and not more, obviously presents difficulties of principle, as it always has all the way through history. The fact that a certain number

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of my noble friends, my noble kinsman and the very eloquent spokesman from the Labour Party Front Bench—who also is not uninfluenced by the opinions of the Law Society—take a contrary view, I am afraid cannot move me in what is a firm and careful decision after estimating the degree of controversy that there would be.
I am bound to say to my noble friend, while I am still asked, that the theory that you bring fewer people into court by charging them more before they get there, is not one to which, as a somewhat experienced practitioner in the county court, one might immediately assent. It may be true, but I do not think that it is self-evidently true, and I am bound to say that I am not sure that you will assist the small trader quite as much as he thinks. My experience, certainly since I have been Lord Chancellor, is that the small trader is complaining that he cannot enforce even the judgments that he gets. This is one of his principal woes when it comes to sending in the bailiffs on a county court judgment. The fact that they are sent in for a little bit more will not, I think, assist him, unless there are the assets to support the judgment debt. But I must firmly say to the Committee that I cannot do it for them. It is no good my pretending that I can, because I cannot.
Lord Mishcon: I add one more plea to the noble and learned Lord, and, if that plea fails, then I, personally, do not intend to worry him further. If I may say so, I do not think that it is merely a question of small businesses and small creditors finding themselves in difficulty in enforcing judgments. I think that it will be a very salutory deterrent to debtors in regard to delaying the payment of their due obligations if they know that they are running up interest—and at the moment they have no such deterrent at all—and that they will have to go to a solicitor, or try to fill up the form themselves, and then go through the process, as the noble and learned Lord knows so very well, of obtaining a judgment before interest under this Bill falls.
I make two other quick observations to the noble and learned Lord. First, he knows so much better than I ever shall that, if one is trying to get an Administration of Justice Bill through Parliament, one will always be told that the difficulty will be there if there is anything controversial in it. What frightens me is the fact that if an opportunity is not taken this time the noble and learned Lord's eloquence will be repeated on another occasion, not because he wants to say these things, but because one has to say these things. Alteration of our law and our procedures does not have a high priority in the normal government programme.
The final thing I say in an endeavour to persuade the noble and learned Lord along the lines that the noble Lord, Lord Renton, mentioned, is this: if the Committee showed its support of this amendment would it be so terribly difficult if, in another place, some very definite opposition was voiced, to allow the Bill to progress by a withdrawal at that stage of this clause? I personally feel with the noble Lord, Lord Renton, that it is not likely that, although there may be opposition outside, there would be parliamentary opposition of any worthwhile force. I would appeal to the noble and learned Lord to see whether this is not a proper
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way of dealing with it. He compared himself with Darius. I would call him a most friendly lion, who growls but does not like hurting anybody, and it is in that sense that I appeal to him.
Lord Lloyd of Kilgerran: May I presume, in effect, to thank the noble and learned Lord for being so frank with the Committee on the difficulties that are facing him. May I ask whether the noble and learned Lord would take this matter back and reconsider the eloquent speech made by the noble Baroness, Lady Sharples, a few minutes ago? She directed her attention to the serious matter of small arms, and the noble Lord, Lord Mishcon, has rightly said that it would be a deterrent to the particularly large firms who do not in practice pay up their debts to the small firms.
The noble and learned Lord referred to the difficulties arising in the county court on the enforcement of directions given by that court. That is not the matter that the noble Baroness raised; it is the general question that small firms do not want to go to court for various reasons, but that the introduction of some kind of measures of this kind for the small firms would act as a deterrent to the larger firms who, as we all know in business practice, are very dilatory in paying their bills.
The Lord Chancellor: I can only say I may be a friendly lion, but my family coat of arms is three boars, and I fancy that this may be the third time that I may be speaking in this debate. I am sorry to say that I have absolutely no room for manoeuvre at all. If it is any comfort to the noble Lord, Lord Mishcon, this is not the first time I have held this debate. The other debates have all been in private. I, of course, am simply the guardian, as it might be, of the Law Commission's reports and I should like to legislate them. This is my general policy, and I do not conceal my desire to do so. But the departments whose business it is to represent businesses take a very different view from the Law Commission about the popularity or feasibility of this move.
If I thought there was any chance of getting my colleagues to alter a decision, which is a Government decision, I would promise to take this back, and of course I shall communicate with other departments and other colleagues as to the views expressed. They have their sympathies too with small businesses which have always been close to the heart of the party of which I am a member, but I assure the Committee that I have no room for manoeuvre here at all.
Therefore, I stand, a friendly lion or the third of three boars heads erased, which I am afraid is what they are called by the heralds, and say that I simply cannot do very much about it. But I will, of course, report to my colleagues and see if there is any sort of consensus behind it, but I can assure the Committee that what I have said is the whole truth so far as I can see it.
Lord Stanley of Alderley: I shall not be able to answer all the questions. Probably in any event I would not know the answers. However, I shall try to answer some of them. First, the whole Committee is agreed that the present state of the law makes it look an ass in so far as there is vagueness in it. The noble Lord, Lord Mishcon, brought this out, and so did my noble friend Lady Sharples.

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Like the noble Lord, Lord Mishcon, I have to say that this problem is not going to go away. I can assure my noble and learned friend that it will come up in another place. Perhaps I could suggest that it might be nicer and kinder if he accepted it in principle here, on the principle that perhaps the devil you know, or the lion you know, or the Daniel you know, is better than the one you do not know, because it is not just going to disappear like that.
My noble and learned friend referred to his colleagues not being convinced that this is the right course. I have great sympathy when colleagues do not agree with you—I am not saying that the noble and learned Lord had a different view—but they were supporting a lot of rather extraordinary people from what I could understand: among other people, the Consumers' Association, the large institutions, and the CBI. For what it is worth, I tried to get through to the CBI to ask what would they think about it and whether they would appear. I have not heard one word in your Lordships' House. At the end of the day, it is surely our job, as Parliament, to decide and not the Consumers' Association, or whatever.
The other point, which it might be unkind to make, is that when it comes to matters mercenary, I have no faith in the Government—not this particular Government, but any Government in matters mercenary. This is a mercenary matter. It is probably why I am rather excited about it. There is nothing like a bit of gold to get a farmer going. This is in our court and not the Government's court.
I am not quite sure what I am going to do. Would my noble and learned friend say again that he would pass on these remarks that have been made in the Committee today about the reservations on this Bill and the support that the amendment has? I have not heard one person speak against my amendment except the noble and learned Lord. I am so tempted to divide the Committee today. I have a feeling I might win. I have seen that happen before, but I have accepted an assurance from the Front Bench that they will look at it again and I have come back later and lost it. It was probably my fault. Before I make up my mind, would my noble and learned friend mind saying just once again that he would put these points very forcefully to his colleagues? Then, perhaps, I would feel inclined to withdraw it at this time.
The Lord Chancellor: I thought I had said exactly that: that I would report the views which have been so eloquently expressed both by my noble friend and from other quarters in the Committee. I am less impressed than he is by the fact that other people who take the opposite point of view have not been so forceful or so eloquent, because they have got exactly what they want, and they know that the Government have come to the conclusion that this Bill cannot contain this particular provision.
I will, of course, do exactly what my noble friend has asked me to do. I will pass it on. But I think that they must take it that at the moment I am not making any other promise than that. I will say frankly to the Committee that of course if another place takes identically the same view as my noble friend, it may be that the Government would yield to the elected Chamber, I do not know, but I would ask for the support
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of the Committee. I am trying to pilot this rather monstrous piece of legislation through. I have applied my mind as honestly as I can to the problems involved. Having said that, I would do just what my noble friend has asked me to do without any further commitment; I hope Daniel will come forth and emerge from the lion's den unscathed.
Lord Stanley of Alderley: I am obliged to my noble and learned friend for that reply and if he puts his case so charmingly and forcefully to his colleagues, I am sure that by Report or Third Reading he will have something more pleasant to tell me and I shall not have to take up the cudgels again. Meanwhile, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 24 to 31 not moved.]
Clause 17 [Relaxation of formal requirements for making wills]:
6.51 p.m.
The Lord Chancellor The Lord Chancellor moved Amendment No. 32:
Page 11, line 42, at end insert—
("(aa) it appears that the testator intended by his signature to give effect to the will; and").
The noble and learned Lord said: This amendment introduces an additional formal requirement for the making of a valid will. In accordance with the recommendations of the Law Reform Committee, which are not fully implemented in the present clause, the amendment makes it clear that the will should be admitted to probate only if it is apparent on its face that the testator intended his signature to validate it. The point was well raised by the noble Lord, Lord Mishcon, on Second Reading and it has, I am told, the support of the Law Society, so I am grateful to the noble Lord for raising it and I have done my best to give effect to what was said.
Lord Mishcon: I, in turn, am most grateful to the noble and learned Lord.
On Question, amendment agreed to.
Lord Mishcon Lord Mishcon moved Amendment No. 33:
Page 12, leave out lines 4 to 6 and insert—
("(c) in the presence of the testator each witness attests and signs the will or acknowledges his signature,").
The noble Lord said: This is a probing amendment. I am not sure—indeed, some of my professional colleagues are not clear—whether paragraph (c) of the new Section 9 allows one witness to sign and the other to acknowledge a previous signature. Only so that it is realised by the Committee that this is a very real point I shall read from paragraph 2.11 of the 22nd Report of the Law Reform Committee on the making and revocation of wills, where the case was cited of re Coiling:
"We would however like to prevent the recurrence of a case such as re Coiling [1972] 1W.L.R. 1440. In that case the testator, who was a patient in hospital, asked a nurse and another patient to witness his signature but, while he was signing and before he had completed his signature, the nurse was called away to attend to another patient. The testator nevertheless continued signing and

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the other witness then signed. When the nurse returned, the testator and the other witness both acknowledged their signatures and the nurse then added her signature. The will was held to be invalid and some have thought that the invalidity resulted from the failure on the part of the testator to sign in the simultaneous presence of the two witnesses. However, in our view, it was not the requirement of simultaneity which invalidated the will in re Coiling because in that case the testator did acknowledge his signature in the presence of both witnesses. What invalidated the will was the requirement that both the attesting witnesses must subscribe after the operative signature or acknowledgement of the testator".
The real purpose of this probing amendment, therefore, is to see whether re Coiling is covered and whether the wording of the clause, in the view of the noble and learned Lord, allows one witness to sign and the other to acknowledge, if that be necessary.
The Lord Chancellor: I can undertake to consider the point. The text as it stands is probably ambiguous in the sense implied by the noble Lord, Lord Mishcon and his reference to re Coiling is entirely apt. I am told that the amendment does not carry matters much further and itself appears to be ambiguous. But I think that both the text and the amendment could be improved by careful drafting and if the noble Lord would agree to withdraw the amendment, I will try to see whether I can come back with something better on Report.
Lord Mishcon: In view of that reply, I most willingly beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 17, as amended, agreed to.
Clause 18 [Effect of marriage or its termination on wills]:
Lord Mishcon Lord Mishcon moved Amendment No. 34:
Page 12, line 38, at end insert ("or as executor and trustee of the will").
The noble Lord said: This, too, is in the nature of a probing amendment. The new Section 18A which is inserted by Clause 18(2) is obviously designed to cut the former spouse out of the will as a beneficiary or executor. Presumably it is not the intention to cut out other references to the former spouse; for instance, an appointment of him or her as trustee or guardian, or a provision giving him or her power of appointment, although it may be for consideration whether a distinction should be drawn between a general and a special power of appointment, as the former could be equated to a beneficial interest.
A will creating a trust normally provides not only for the appointment of executors but the appointment of executors and trustees of the will, and that is done at the same time. In such a case, one feels there may be some doubt about the position of a former spouse appointed, for example, as an executor or trustee if the marriage is terminated. Perhaps the noble and learned Lord could explain the thinking behind the drafting of the provision. That is why I tabled the amendment: is it intended that an executor and trustee—I give that merely as an example—by way of an appointment of a former spouse would mean that she would, under the clause, drop both appointments, or would it be only that of executor and not of trustee?
The Lord Chancellor: The best and shortest thing I can say to the noble Lord is that I accept the amendment.
Lord Mishcon: I, in turn, am most grateful.
On Question, amendment agreed to.
Clause 18, as amended, agreed to.
Clauses 19 to 22 agreed to.
Clause 23 [Deposit and registration of wills of living persons]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 35:
Page 15, line 29, after ("below") insert ("(a)").
The noble Lord said: I will, with permission, speak at the same time to Amendment No. 36. These are minor technical amendments which place the registering authorities under a duty to register not only wills which have been deposited with them but also wills in respect of which registration is requested under Article 6 of the Registration Convention. Thus, a small omission is repaired.
Lord Mishcon: While I have nothing to say about the amendment, perhaps the Committee will permit me to comment—it will save time if I make the point now—that I happen to know that the noble and learned Lord's department has received some submissions on all the clauses relating to wills from the Law Reform Committee of the Holborn Law Society and a memorandum from the Law Society itself. Instead of reading out memoranda and referring to technical points which might make me look much more learned than I am, it would be more sensible if I asked the noble and learned Lord whether his department has received the memoranda and whether, in his kindness, he is giving consideration to the points that have been raised, and perhaps they can be dealt with between now and Report.
The Lord Chancellor: I have received memoranda. They are under consideration and I will write to the noble Lord about the results of the lucubrations of those who know more about these things than I do.
Lord Mishcon: I am most grateful.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor: moved Amendment No. 36:
Page 15, line 30, at end insert—
(";and
(b) any other will whose registration is requested under Article 6 of the Registration Convention.").
On Question, amendment agreed to.
Clause 23, as amended, agreed to.
Clause 24 [Designation of Principal Registry m national body under Registration Convention]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 37:
Page 16, line 12, leave out from ("Registration") to end of line 21 and insert ("Convention, and shall accordingly have the functions assigned to the national body by the Registration Convention including, without prejudice to the general application of

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the Convention to the Principal Registry by virtue of this section, the functions—

(a) of arranging for the registration of wills in other Contracting States as provided for in Article 6 of the Convention;

(b) of receiving and answering requests for information arising from the national bodies of other Contracting States.").

The noble and learned Lord said: This is a technical amendment, which substitutes a wider definition of the functions of the national body for the narrower one presently found in Clause 24. Clause 24 designates the Principal Registry of the Family Division as the national body under the Registration Convention, and provides that it is to have the functions assigned to that body by Article 3 of the convention. However, the description of the functions presently found in subsection (2) is far too narrow, as other actions apart from those specified will need to be performed by the Principal Registry. The amendment therefore introduces a more widely drawn definition of these functions. I beg to move.
On Question, amendment agreed to.
Clause 24, as amended, agreed to.
Clause 25 [Regulations as to deposit and registration of wills etc.]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 38:
Page 16, line 26, leave out from ("conditions") to end of line 31 and insert ("for the deposit of a will;
(b) as to the manner of and procedure for—

(i) the deposit and registration of a will; and

(ii) the withdrawal of a will which has been deposited; and

(iii) the cancellation of the registration of a will; and").

The noble and learned Lord said: In moving Amendment No. 38, I should like to speak to this amendment and Amendment No. 39 together. These are technical amendments consequential on the amendment to Clause 23, which places the registering authorities under a duty to register wills deposited abroad where registration is requested in this country under Article 6 of the convention. Clause 25 provides for the making of regulations as to the deposit and registration of wills. As it is drafted at present, it does not allow for the making of regulations governing the registration of wills in this country which have, in fact, been deposited abroad. The rule-making powers have therefore been re-cast to take this into account and have also been simplified. I beg to move.
Lord Mishcon: I appreciate, as will the Committee generally, the force of the convention, but will the noble and learned Lord in his kindness consider the whole advisability and inadvisability of the registration of wills made by testators in this country?
The Lord Chancellor: I shall certainly take back that point and write to the noble Lord. I thought that it was now rather the popular thing to think that it was advisable, but I shall certainly consider it.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 39:
Page 16, line 34, leave out from ("Convention") to end of line 37.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 40:
Page 17, line 1, leave out ("Regulations as to the deposit and registration of wills") and insert ("Any such regulations").
The noble and learned Lord said: This is another technical amendment. It removes the apparent distinction presently drawn by Clause 25(3) between regulations as to the deposit and registration of wills and some other, unspecified, type of regulations. Clause 25 provides for the making of regulations as to the deposit and registration of wills. The opening words of subsection (3) appear to draw a distinction between two different kinds of regulation. No such distinction is in fact made in the Bill. All regulations made under this clause will be concerned with the deposit and registration of wills, and the amendment makes that quite clear. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 41:
Page 17, line 17, leave out ("under subsection (3)(c) above") and insert ("for Northern Ireland").
The noble and learned Lord said: This is another technical amendment. It corrects the mis-statement in Clause 25(6) that regulations in respect of Northern Ireland are made under subsection (3)(c) of the clause. Subsection (6) of the clause provides that regulations in respect of Northern Ireland shall be statutory rules for the purposes of the Statutory Rules (Northern Ireland) Order 1979. All regulations made under the clause are in fact made under subsection (1), not subsection (3)(c). Furthermore, subsection (6) is concerned with Northern Ireland and it is therefore correct to replace the reference to subsection (3)(c) with a reference to Northern Ireland. The amendment has that effect. I beg to move.
On Question, amendment agreed to.
Clause 25, as amended, agreed to.
Clause 26 [Fees as to registration in Scotland]:
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 42:
Page 17, line 38, after ("Registers") insert ("of Scotland").
The noble and learned Lord said: This is a minor amendment to correct the reference to the Keeper of the Registers of Scotland, so that he is given his full and proper designation. I am sure that your Lordships' Committee will be glad to do that. I beg to move.
On Question, amendment agreed to.
Clause 26, as amended, agreed to.
Clause 27 agreed to.
Clause 28 [International wills—procedure]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 42A:
Page 18, line 18, leave out ("made in accordance with") and insert ("certified by virtue of").
The noble and learned Lord said: This is a minor technical amendment correcting the mis-statement made in Clause 28(3), as now printed, that international wills are made in accordance with subsections (1) and (2) of the same clause. They are in fact made in accordance

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with the annex set out in Schedule 2 to the Bill. I beg to move.
On Question, amendment agreed to.
Clause 28, as amended, agreed to.
Clauses 29 to 31 agreed to.
Clause 32 [Jurisdiction in relation to counterclaims etc.]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 42B:
Page 19, line 40, leave out ("this") and insert ("that").
The noble and learned Lord said: This amendment is consequential. It corrects a mistaken reference to the new Section 75D, which is inserted by Clause 32, by changing it for a reference to Section 75C(1)(c). The error came about because Section 75D was originally a subsection of Section 75C. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 42C:
Page 20, line 2, leave out second ("the") and insert ("and").
The noble and learned Lord said: This amendment corrects a small slip. The Bill refers to "set-off the counterclaim". It should read, "set-off and counterclaim". I beg to move.
On Question, amendment agreed to.
Clause 32, as amended, agreed to.
Clause 33 agreed to.
Clause 34 [Transfers from High Court to county court]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 43:
Page 20, line 37, leave out from ("amount") to ("after") in line 38 and insert ("exceeding £5,000 must be enforced in the High Court)").
The noble and learned Lord said: I think that I can describe this amendment as being purely drafting. It corrects the description, given in Clause 34(3) of the effect of Section 1(2)(c) of the Charging Orders Act 1979. I have a slightly longer explanation if it is demanded. I beg to move.
On Question, amendment agreed to.
Clause 34, as amended, agreed to.
Clauses 35 to 38 agreed to.
Clause 39 [Investment of money transferred to National Debt Commissioners]:
7.10 p.m.
The Lord Chancellor The Lord Chancellor moved Amendment No. 44:
Page 23, line 28, leave out ("section 38") and insert ("subsection (1)").
The noble and learned Lord said: This amendment corrects another erroneous reference. It is a reference in subsection (2) of Clause 39, which refers to Section 38 of the Bill, and it inserts instead the correct reference, which is to subsection (1) of Clause 39. I beg to move.
On Question, amendment agreed to.
Clause 39, as amended, agreed to.
Clauses 40 and 41 agreed to.
Clause 42 [Common investment schemes]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 45:
Page 24, line 43, at end insert ("and money held by any person authorised under subsection (5) below to hold shares in common investment funds").
The noble and learned Lord said: This amendment makes it clear that the Lord Chancellor may continue to make common investment schemes establishing common investment funds for the investment of funds by a person authorised by the Lord Chancellor as well as the investment of funds in court. I do not think anything is likely to turn on this, so I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 45A:
Page 25, line 44, after ("this") insert ("Part of this").
The noble and learned Lord said: This amendment narrows the extent of subsection (10) of Clause 42 of the Bill so that it extends only to Part VI, which deals with funds in court. It will ensure that the intention of the clause is clearly expressed. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 46:
Page 26, line 14, leave out ("under subsection (11) above") and insert ("in respct of the running of the scheme").
The noble and learned Lord said: This amendment extends the scope of subsection (12) to cater for the possibility that the Lord Chancellor might in due course appoint a private manager of the common investment schemes. I do not think I need elaborate on that unless the Committee requires me to do so. I beg to move.
On Question, amendment agreed to.
Clause 42, as amended, agreed to.
Clause 43 [Provision for making good defaults]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 46A:
Page 26, line 26, leave out ("scheme") and insert ("fund").
The noble and learned Lord said: This amendment substitutes the word "fund" for the word "scheme" so as to bring the terminology used in this clause into line with that used through the rest of Part VI. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 46B:
Page 26, line 27, leave out ("funds in court") and insert ("money for which he is responsible under this Part of this Act").
The noble and learned Lord said: This amendment makes it clear that the Lord Chancellor may certify that the manager of a common investment scheme has been guilty of a default in relation to any funds for

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which the manager is responsible, and not just for funds in court. I beg to move.
On Question, amendment agreed to.
Clause 43, as amended, agreed to.
Clauses 44 to 49 agreed to.
Clause 50 [Orders for the maintenance of wards of court]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 47:
Page 30, line 10, leave out ("(3)(a) and insert ("(2)(b)").
The noble and learned Lord said: In moving Amendment No. 47 perhaps I may speak also to Nos. 48, 80 and 81. These are linked amendments and are designed to show that a court ordering maintenance to be paid directly to a ward of court can make such an order against both the parents instead of only one of them, which might be appropriate in a case where the child is living with neither parent and they both have means. There are parallel amendments to Schedule 6, Amendments Nos. 80 and 81, to which I am also speaking, but these only make the same changes for Northern Ireland. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 48:
Page 30, line 12, leave out from beginning to ("there") in line 14 and insert ("parents of a ward of court to make periodical payments towards the maintenance and education of the ward) after the words "the ward"").
The noble and learned Lord said: This is a consequential amendment. I beg to move.
On Question, amendment agreed to.
Clause 50, as amended, agreed to.
Clause 51 [Remission of arrears of maintenance]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 49:
Page 30, line 16, leave out ("At the end of section 31(1)") and insert ("The following subsection shall be inserted after subsection (2) of section 31").
The noble and learned Lord said: This and the next amendment, No. 50, to which also I would speak in moving No. 49, confine the scope of Clause 51 so as to limit the new power to remit arrears to orders for periodical payments. As it stands, Clause 51 gives the divorce courts a new express power to remit arrears in all cases where the court has power under Section 31 of the Matrimonial Causes Act 1973 to vary orders for financial relief after divorce, nullity or judicial separation proceedings. Section 31 of the Act of 1973 applies only to certain classes of order; namely, orders for periodical payments, orders for payment of a lump sum in instalments and certain orders for settlement of property or a variation of settlement after a judicial separation, though the latter are not really relevant because in such cases, of course, no question of arrears arises. It is the application of the new power to lump sum instalment orders that these amendments would correct. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 50:
Page 30, line 21, leave out ("there shall be added the words "or") and insert—
("(2A) Where the court has made an order referred to in subsection (2)(a), (b) or (c) above, then, subject to the provisions of this section, the court shall have power").
On Question, amendment agreed to.
Clause 51, as amended, agreed to.
Clauses 52 to 54 agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 51:
After Clause 54, insert the following new clause:
("Attachment of debts
.—(1) The section set out in Part I of Schedule (Attachment of debts) to this Act shall be inserted after section 40 of the Supreme Court Act 1981.
(2) The section set out in Part II of that Schedule shall be inserted after section 143 of the County Courts Act 1959.").
The noble and learned Lord said: This amendment—I should like, if I may, to speak to Amendment No. 75 in the schedule—applies to the administrative expenses and the clerical expenses of a garnishee. The purpose of new Clause 54A and new Schedule 3A is to enable provision to be made for the expenses incurred by financial institutions in complying with garnishee orders. Part I of Schedule 3A makes such provision for the High Court and Part II makes similar provision for the county courts. Clause 54A(1) provides for the insertion of a new section in the Supreme Court Act 1981 and subsection (2) provides for an insertion in the County Courts Act 1959.
The new section to be inserted in the Supreme Court Act 1981 is set out in Part I of new Schedule 3A. The new Section 40A(1) of the Supreme Court Act 1981 enables a sum to be prescribed which may be deducted by a garnishee from money which would otherwise be attached by a garnishee order, as a contribution towards the expenses of complying with the order. The modern jurisdiction of the High Court to attach debts exists by virtue of rule (Order 49 of the RSC) rather than statute.
Accordingly, reference is made to Section 40(2) of the 1981 Act which does not itself create the jurisdiction to attach debts but provides a description of that jurisdiction. The institutions who are to have the benefit of the new provision are limited to those set out at (a) and (b) of the new subsection (1). The expression "deposit-taking institution" is defined in subsection (3), with a reference to Section 40(6) of the 1981 Act, which itself contains a reference to the Banking Act 1979, the effect of which is to include banks, building societies and certain other financial institutions within the definition. There is power at subsection (1)(b) to limit the benefit of an order under the provision to institutions with a minimum number of branches. The power to make an order under the new clause is exercisable by the Lord Chancellor.
On Question, amendment agreed to.
Clauses 55 to 60 agreed to.
7.22 p.m.
Lord Gifford Lord Gifford moved Amendment No. 52:
After Clause 60, insert the following new clause:
"Documents disclosed in litigation
.The obligation to protect and maintain the confidentiality of the contents of a document dislosed to a party to litigation or his solicitor shall terminate if and to the extent that the contents

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of the document are read aloud in open court in proceedings which are not subject to any limitation on reporting."
The noble Lord said: This amendment is similar to an amendment which I moved on two occasions during the passage of the Contempt of Court Bill. On the second Marshalled List, there has crept into the amendment an Americanism, the word "perty", which is a misprint. During the Contempt of Court Bill, the case of the Home Office v. Harman was passing through various stages of its way through the courts and on the Report stage of that Bill the amendment was not pressed to a Division because the House of Lords had yet to rule on the matter. The noble and learned Lord the Lord Chancellor promised that when the House of Lords had made a ruling he would look at all the implications of the issue which was raised.
The House of Lords delivered judgment on 11th February 1982 and, by a majority of three to two, gave judgment in favour of the Home Office. Now the noble and learned Lord can, I feel, delay no longer in addressing himself to the issue raised in that case. I am grateful that the broad terms of this Bill allow me to raise it so soon after the House of Lords delivered judgment.
May I briefly explain what the point is and in doing so may I emphasise that we should try to stick to the point of issue in this amendment rather than rehearse the rights and wrongs of the Harriet Harman case. The point is that when parties are in litigation they are under a duty to hand over, to disclose, to the other side all the documents which are relevant to the issues in the case. It is a duty which is of great value and helps the courts to deal justly and gain access to the truth. Because the documents are usually private documents, the litigant and his legal advisers are under a duty not to disclose them for purposes other than the purposes of litigation. That, again, is a valuable duty because it preserves the confidentiality of the documents for so long as they are not needed publicly in the litigation. If and when the case comes to court, the documents if they are relevant may be read out, questions may be asked about them, witnesses may be asked to explain why they wrote them and the whole case may turn on them and on what they mean. Above all, the public hear their contents and in a number of courts, including the High Court, a transcript is made of the publicly-heard proceeding.
One would think in those circumstances that the documents would no longer be confidential and that there would no longer be a duty not to disclose them. But it is not so. The law is that a litigant or his solicitor is not permitted to inform other people of the contents of the document. The law in so ruling, I suggest, is absurd and dangerously so.
The public may, on payment, obtain a transcript, if there is one, and find out what was in the document. The public, if they happened to have been in court, may take down in shorthand the document and its full contents; but those who are parties to the litigation are not allowed to tell anybody else, however much in the public interest it may be for them to write about or talk about the document, because that same duty of confidentiality is said still to remain against it. It is wrong headed in the extreme. What is even more absurd is that if the litigant were to give the document
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to a law reporter or to what was described by one noble and learned Lord, the noble and learned Lord, Lord Roskill, as a day-by-day reporter, it would not be a contempt. But if he gives it to the writer of a feature article, it is a contempt.
It is a distinction which those involved in the press and the media find quite unacceptable and quite unreal. I was glad to hear, as no doubt others have heard, that the Press Council have pronounced themselves very much in favour of the move by this amendment to change this wrong-headed law. As well as being absurd, it is serious. It strikes at the principles of free communication and creates barriers to the public being informed about what has gone on in a public court and, yet again, it puts this country in danger of being in breach of the European Convention of Human Rights which, in its article on the right to free expression, lays down clearly the right to impart and receive information.
The case of the Home Office v. Harman went through three courts and one could say that the law in those courts showed itself to be bearing the head, body and legs of an ass. But it was not wholly an ass because it had the tail of a robust British lion in the persons of the noble and learned Lords Lord Scarman and Lord Simon of Glaisdale. They in a joint judgment delivered themselves of what amounts to an essay on human rights, from Milton through the American Constitution down to the European Convention on Human Rights. I cannot do better in commending this amendment to the Committee than read one passage of their joint judgment. They said this:
"the common law by its recognition of the principle of open justice ensures that the public administration of justice will be subject to public scrutiny. Such scrutiny serves no purpose unless it is accompanied by the rights of free speech, i.e., the right publicly to report, to discuss, to comment, to criticise, to impart and criticise and to receive ideas and information on the matters subjected to scrutiny. Justice is done in public so that it may be discussed and criticised in public. Moreover, trials will sometimes expose matters of public interest worthy of discussion other than the judicial task of doing justice between the parties in the particular case. It cannot be desirable that public discussion of such matters is to be discouraged or obstructed by refusing to allow a litigant and his advisers who learnt of them through the discovery of documents in their action, to use the documents in public discussion after they have become public knowledge.
"We believe the true path forward is to ensure that our law develops in a way which is consistent with the obligations accepted by the United Kingdom in the European Convention and with the development of the common law achieved in America".
I urge the Committee, by accepting the amendment moved today, to uphold the wisdom of those two noble and learned Lords. I beg to move.
Lord Rawlinson of Ewell: It is impossible to consider this new clause without reflecting again upon the case of the Home Office v. Harman—a case in which very murky circumstances arose which I think aroused grave suspicion of professional conduct in that particular case, smacking of a maneouvre being employed whereby if documents could by a strategem—that is, a longwinded opening—be read in open court, then those documents, which had been obtained by the process of discovery, could be shown to somebody totally outside that case but who was planning to write some politically sympathetic article attacking one of the parties to that litigation.
It was the circumstances of a disclosure then to a journalist, not on the instructions of the client whom

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this particular solicitor represented, who was going to write this particular article after a case in which counsel had seen fit to open the case for five days, reading—or purporting to read—800 pages, or the material part of those 800 pages, and appeared, as I said, to employ a tactic to promote some interest which was collateral to the actual issues of that case attacking in fact a party to the litigation in respect of matters not concerned with the action as such.
Beneath the formality of the judgments of the Court of Appeal and the speeches of the Judicial Committee of this House, and apart from the distinguished speeches —an extract of one of which has been quoted to this Committee—there comes a suspicion of some unattractive, strange practice. Whether it was contempt or not, there is little credit to the professional people engaged in it. Of course, it served to increase suspicion and doubt over the aims and practices of the National Council for Civil Liberties, with its very high-sounding title. If it should live up to that title, it should certainly never stoop to any questionable tactics.
The process of discovery is an onerous invasion of people's private rights. It means that documents can be disclosed to somebody else which otherwise hitherto are privately in the possession of a particular person. It should and ought to be jealously guarded and properly applied. Anything smacking of a trick reflects very ill of any practitioner who stooped to it. It is the duty to refrain from using the advantage of discovery, which is obtained purely because one is a party in a particular suit, for some ulterior purpose. As a result, practitioners would have much greater difficulty in getting discovery from, for instance, departments of the Crown. Often it is difficult to get documents and sometimes it is very important to get them. But if there is going to he the suspicion that the documents are going to be used not in the action but for some totally different political purposes, then departments would rightly fight every case of discovery.
Such conduct therefore inclines, and will incline, parties, whether they be departments, large corporations or ordinary parties, towards far greater reserve and caution. Public policy demands that an undertaking given by a solicitor to the court when obtaining the private documents of the adversary not to take advantage of the possession of those copies, to use for a collateral purpose, is essential. In my view, it should not end when the document is actually read in open court. Otherwise, one can use a ploy, the trick—if a professional advocate stoops to it—of being able then thereafter to use these documents. Discovery is a unique part of the common law system and it requires safeguards against abuse.
I also—unlike the noble Lord—can accept that there should be a distinction between the situation where counsel—as they often do—shows, for instance, to an accredited law reporter a document which has been used in the course of proceedings and/or to a reporter who has been in court and is proposing to afford for the public a proper contemporary record. I can sec the distinction between that and a deliberate showing to a commentator not interested in the particular case in which the document has been read and who is known to be going to use it not to report that case but to mount an attack on an opposing party.
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Therefore, I agree with the judgment of the noble and learned Lord, Lord Diplock, in this particular case that it was nothing to do with the freedom of speech or the freedom of the press. I do not think that we should be misled by such assertions. I do not think that the press can have examined this carefully enough. The noble Lord referred to the Press Council. The Press Council could not have looked at it very carefully and very closely because they even muddled up which judge in the House of Lords gave judgment in a particular way. I do not think that they or their advisers have applied their minds very closely to it.
Lord Mishcon: Will the noble Lord give way?
Lord Rawlinson of Ewell: Well, if I may just finish—
Lord Avebury: Very discourteous!
Noble Lords: Order !
Lord Mishcon: I was only about to correct—
Lord Rawlinson of Ewell: If the noble Lord on the Liberal Benches will wait a moment, it is my habit to give way and I will give way when I have completed my sentence. I really do not need—if the noble Lord will accept it—instructions from him about courtesy. All I wished to say was that I do not think that the Press Council had examined this matter sufficiently carefully for them to consider it had this attack, as it were, upon freedom of the press, the freedom of speech, which they purport to do.
Lord Mishcon: The noble and learned Lord is, as always, very courteous and I am obliged to him. I am sorry if I interrupted him in the middle of a sentence, but I know that he is, as always, anxious to be fair. The Press Council issued a statement almost within a matter of hours—I certainly received it—apologising for their error in quoting the wrong Lord of Appeal in Ordinary and putting themselves right. Therefore, since that statement was issued to every noble Lord who had the original statement, the noble and learned Lord would not want to be unfair in making the point that the fact that they quoted the wrong judge showed that they had not considered the matter.
Lord Rawlinson of Ewell: I certainly do not want to be unfair; but let us just recollect that here was the Press Council, over that important signature, setting out their argument in favour of this particular amendment and referring us to the particular case and to the particular speeches or judgments. All I can say is that the person dictating the statement may have got it wrong and the mistake was not noticed; but I could not help feeling, a little wryly, that sometimes the press can get things wrong, and they got it very wrong in this particular case. However, they have corrected their mistake and they have set out their basic belief—that this is a grave infringement, as they believe, upon the liberty of reporting and of the press, and they have urged noble Lords to support this amendment.

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However, I believe there is a superior interest, which is that of the maintenance of the discipline which there ought to be when you give to parties this particular power of discovery. Therefore, I believe that to use it in a way such as it was used in that case was a wrong thing to do and I would not like to see any extension or any ability for anybody to be able to do that again.
Lord Avebury: I very much deplore the language which the noble and learned Lord has seen fit to employ in his discussion on this matter and the personal attack he has made on Miss Harriet Harman, whose case has given rise to this amendment. I agree with the noble Lord who moved this amendment in saying that it would be far better if your Lordships were to address your minds to the merits of maintaining confidentiality of documents in cases similar to the one in question, rather than to personalise the issue, as the noble and learned Lord has done in his speech.
He made it absolutely clear that what was concerning him was not so much the question of the amendment itself but the use that might be made of documents that were disclosed in court, and whether that use was politically acceptable to him or not. The fact that an attack was launched by the author of the offending article, Mr. David Lee, on the practices of the Home Office, is enough to make the noble and learned Lord say that the decision of the Judicial Committee was the correct one and it was the political issue which was uppermost in his mind, so it appeared from his speech, in reaching that decision.
But the amendment deals with the treatment of documents read out in open court generally, where the court itself has not imposed any restriction on the reporting of those documents. I think it is worth making the point that the court does have the power to order that a particular document should not be referred to or that a document should he read silently or that when a document is being read the court should sit in camera. Therefore, when the court thinks that confidentiality is of overriding importance, outweighing the principle that justice should he open and public, it has the means to give effect to that view; but in all other cases the rule should be that a document, once read out, should be in the public domain.
I make this answer to the noble and learned Lord when he says that were the judgment to be reversed it would make it far harder to secure discovery from public departments, because if the courts have this power to order the documents to be read silently or in camera then where disclosure is committed but the document nevertheless should not he in the public domain, the court has the means of taking the necessary action. I think I am right in saying that the position was always thought to be that a document read out in open court was thereby placed in the public domain: I did not think there was ever any doubt on that matter until recently. Indeed, I believe that was the opinion of the Attorney-General, as was said in another place, but the Home Office, I understand, did not take the advice of the Attorney-General and sought to clarify the law—or, as some would think, to create a new law to suit their own purpose.
The Judicial Committee declared in their judgment that they were deciding a major new point of law and,
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by a majority, they came down on the side of the Home Office and against what everybody else had thought the law to be until that particular time.
Parliament did not make that law; the judges made it. Parliament has never had an opportunity of pronouncing on that matter because, as the noble Lord, Lord Gifford, has already mentioned, while the Contempt of Court Bill was under consideration the Harman case was still subject to appeal, and so it was not until February 1982, when the Judicial Committee found against Miss Harman, that the opportunity came for your Lordships to consider this matter. This is the first occasion on which it has been possible to arrive at a conclusion on it without running foul of the sub judice rule.
I think it is essential that Parliament should now take a view on the issue because I agree with the noble Lord who moved the amendment that it raises major questions relating to freedom of expression and particularly to the freedom of the press to report what is said in the courts of law. I received a letter only yesterday from the Press Council, saying that at their meeting last week the council had unanimously supported the amendment now before your Lordships. They had arrived at that decision with the benefit of mature consideration, and I think the noble and learned Lord was being very unfair to them in the point he made just now about the confusion in regard to the name of the judge. That did not alter the substance of the matter. What the Press Council thought about the ruling when they first issued their press statement is what they still think, and it made no difference to the view that they took that the name of the judge in their original press statement had to be amended—and was indeed amended, as the noble Lord, Lord Mishcon, has said. I thought that was an argument which, if I may say so, was totally unworthy of the noble and learned Lord—that because a mistake had been made in the name of the judge the worth of the statement originally made by the Press Council was thereby destroyed.
But the Press Council is not the only body concerned with the freedom of the press which has expressed an opinion on this matter. The Guild of Newspaper Editors and the National Union of Journalists, of which I have the honour to be a member, have said that the ruling will make it far more difficult to report court proceedings accurately; so we are not just dealing with some mysterious legal technicality but with something which will adversely affect the freedom of newspapers to report what is said in court.
There is one other point which I think should be made, and that is that the Law Commission in its report on confidentiality, in considering the case of the Home Office against Miss Harman emphasised that that case related to liability not for a breach of confidence but for contempt of court, and that was not the concern of the report. Nevertheless, having gone on to consider the implications of the Harman case, they concluded:
"We do not think that civil liability for breach of confidence should persist after the information to which the relevant obligation of confidence related had been published in open court".
A little later on they say:
"In the interests of the free circulation of information we think everyone ought to be able to rely, so far as any civil liability for breach of confidence is concerned, on the fact that the information in question has been published in open court".

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Is it not an additional absurdity, to add to what has already been mentioned by the noble Lord, that the law of confidentiality, as it should be according to the Law Commission, will not be compatible with the law of contempt? It seems to me that the two should march hand in hand, but they will not if this judgment is allowed to stand.
The noble Lord has already mentioned the problem of the European Commission for Human Rights. One would have thought that we were in enough trouble with that body already without allowing further ammunition to be given to those who would seek to raise cases against the United Kingdom in that forum. There is no doubt at all, when one looks at it, that the European Commission would come down against us if a case were brought in respect of this matter.
In conclusion, I also should like to refer to what was said by the noble and learned Lord, Lord Scarman, in his remarkable judgment which has already been quoted by the noble Lord who moved the amendment. He pointed out that no one disputed that once documents had been read aloud in open court,
"and were not subjected to any specific lawful direction prohibiting publication, they entered the public domain".
They were no longer confidential. Privacy had been stripped from them.
The noble Lord who moved the amendment has pointed out that, in the case of any other person except a solicitor, no breach of contempt could be alleged. If I were in the court and either was able to take a shorthand note of the proceedings or happened to have a very good memory, I could go out and repeat to my friends everything that had been said there. If, as the noble Lord has pointed out, a solicitor were to divulge what had been said to anybody except a feature writer, no contempt would be committed.
So I really think that, as the noble and learned Lord, Lord Scarman, and his colleague in the dissenting judgment have shown, we should be getting into a real muddle if we allowed this to stand. I very much hope that your Lordships will take this opportunity of putting right something which will severely inhibit the newspapers, and which will bring us into possible conflict with our obligations under the European Convention if it is allowed to stand.
7.53 p.m.
Lord McGregor of Durris: This amendment provides an apt illustration of the platitude that rights can be enjoyed and protected only if they are restricted. The difficulties of making a wise accommodation between freedoms and responsibilities are sharply clarified in the relations between the press and the institutions of justice. A free press and a fair and honourable administration of justice are among the bases of democracy. To the extent that this amendment hears upon their relationship, it has an importance which goes far beyond the case from which it stems, the details of which I intend to ignore.
The voice of the layman ought to be heard alongside that of the lawyer in this discussion, but even the lawyers and the judges do not agree what the significance of the case of the Home Office v. Harman is. I am referring not to the domain of the professional lawyer,
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which I am not competent to discuss, but to the broad concerns of all citizens. If the layman turns to the judgments, he finds that the noble and learned Lord, Lord Diplock, said—and in quoting him I am following what seem to have been laid down as the proprieties of the discussion of this amendment—
"In a case which has attracted a good deal of publicity, it may assist in clearing up misconceptions if I start by saying what the case is not about"—
the "not" is italicised—
"It is not about freedom of speech, freedom of the Press, openness of justice or documents coming into the public domain".
On the other hand, the noble and learned Lords, Lord Scarman and Lord Simon of Glaisdale, declared:
"Since the question before your Lordships falls to be answered on the basis of principle, we do not think that the nature and the duration of the obligation can be determined by reference merely to the requirements of the law relating to discovery of documents. Regard must also be had to the requirements of the general law protecting freedom of communication".
It does not matter for my purpose which of these views is correct. What does matter for laymen is that some lawyers and many laymen believe that we are discussing an issue which affects the freedom of communication. As the clause stands, every newspaperman and editor to whom I have spoken feels that it restricts unreasonably their freedom of reporting and imposes the distinction of the noble and learned Lord, Lord Diplock, between law reporters and other sorts of reporters, which would be impossible to maintain in the world of newspapers.
This is the view of the Press Council, and I did not find acceptable the suggestion of the noble and learned Lord, Lord Rawlinson, as to the inadequacy of the consideration which that body had given to this matter, because I recall that the chairman of the Press Council is a distinguished practitioner, and I am certain that proper consideration was given both to the professional implications of the amendment and to its effect upon the conduct of newspapers.
Editors find the possibility that documents may not cease to be confidential even if read in open court, and that quoting from them may prejudice the administration of justice, so puzzling as to be almost incomprehensible. On this matter, I think that it is clear that respect for the present clause has been withdrawn, because it strikes an unwise and impractical balance between the values of freedom of reporting and of the proper administration of justice. This is bad for the law and it is bad for the press.
Historically, the law and the press have, through open reporting since the end of the 18th century, been one of the important guarantees of the independence of the judiciary and of securing fair and effective administration of justice. The volume of opinion that regards this clause as bad in its effects upon this vital area of public policy is so great that I would ask the noble and learned Lord to accept the amendment proposed by the noble Lord, Lord Gifford.
8 p.m.
Lord Wedderburn of Charlton: I apprehend that the noble and learned Lords, the Lord Chancellor and the Lord Advocate, will, in their good nature, say something to accept the principle of this amendment, whether or not the precise wording.

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May I briefly suggest to the noble and learned Lords why I feel that, and I hope that I am not mistaken. It is because the principle is now established, as principles are in the Judicial Committee, at three votes to two. I wonder what the position would have been if the majority had gone the other way. I wonder whether the noble and learned Lord would be promoting a Bill to establish by statute the position that we have now. And if he were not, then I wonder what ground there would be for opposing the principle, at least, of my noble friend's amendment. It would be a most extraordinary Bill. It would be a Bill which said that once documents were read out in court where there were no restrictions on reporting and all the other provisos which my noble friend has made, they entered the public domain, except for the litigant and the solicitor.
To take the absurdity from the judgments, which is discussed by the noble and learned Lord—I refer to the particular judgment in the Harman case, though not to refer to it in terms which T would not use outside the privilege of this House—the position now is, and would be under the Bill promoted by the noble and learned Lord, that the solicitor, after the document had been read out, would not offend against the law if he handed to the journalist the transcript of the proceedings but that he would offend against the law and would be guilty of contempt under the legislation if he gave the documents themselves to the journalist. Then the Bill would go on to define the journalist as against the law reporter. I do not believe that the noble and learned Lord would advance such a Bill in your Lordships' House.
I thought, again: if the next Government, when the noble and learned Lord's distinction is placed on the Opposition Bench, advanced a Bill to put these principles into practice, he would come down to this House, raise an enormous majority and correctly defeat any Government who tried to enact such principles. I believe he would feel that this is right.
Therefore, taking into account all the fundamental principles which my noble friend Lord McGregor has suggested are at stake, taking also into account the European Commission on Human Rights to which the matter may well be taken (and before which I agree with my noble friend the Government would lose if they defended the present law), and taking into account, further, the Law Commission and the logic of both the noble and learned Lord, Lord Scarman, and the noble and learned Lord, Lord Simon of Glaisdale, I entreat the noble and learned Lord at least to accept the principle of this amendment, which is so clearly right.
8.3 p.m.
Lord Hutchinson of Lullington: I support this amendment as a practising lawyer. I would urge that the amendment raises a fundamenal question of principle and of common-sense. I am very sad that the noble and learned Lord, Lord Rawlinson, should have dealt with this amendment on a personal basis and, if I may say so, on a political basis. On that matter, Miss Harriet Harman, to my own knowledge, is a most honourable and upright solicitor who would not have dreamt of doing anything, as an officer of the court, if she had not considered that what she was doing was perfectly within the law. It is only right
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to say in that context that every one of the learned judges who dealt with this matter, below and above, went out of their way to say that the court did not in any way impugn the bona fides of Miss Harriet Harman. I think that that should be said.
This matter raises once again in your Lordships' House the question of the law of contempt. This is a sensitive area which may guarantee that the stream of justice runs clear and unsullied. On the other hand, it may fundamentally interfere with freedom of expression and freedom of communication. The majority speeches in the Judicial Committee, I would suggest, obviously do so interfere. If one takes the case of the advocate in court, the situation now is Gilbertian in its idiocy. In fact, I should declare an interest in this matter, in that I swore an affidavit in that case in order to assist the court as to what the procedure is in the criminal courts. Throughout my experience in the criminal courts, if a reporter came up to me at the end of the day in court and said, "I did not hear the contents of exhibit 47", or,"You referred to exhibit 47 but did not read it out; could I have a copy of it?"I considered it to be my duty, even if my own client might not wish for the publicity which inevitably follows from court reporting, to show him anything that had come into the public domain during the course of the case. And, as I say, I swore an affidavit to that effect.
What is the situation now? A gentleman comes up and says, "May I see the document you referred to in your opening?" "Who are you, sir?" "I am a law reporter". "Oh, certainly; here is a copy of it". Another gentleman comes up. "Who are you, sir?" "I am a court reporter". "Oh; are you intending to give a fair and accurate report of what I said?" "Oh, yes, of course I am". "You are quite sure that you are?" "Yes". "Very well, here is a copy". A third gentleman comes up and says, "I am the home affairs representative of The Times newspaper. This case has all sorts of interesting implications and I want to write an article about it next week for The Times. Could I have a copy of the document referred to?" "But that is comment, Mr. Jones. That will be comment, won't it?" "Yes, it will". "Oh, no, I can't possibly show it to you". He will then say, "Can I ask my colleagues, to whom you have just given copies, for a copy?" "Well, that is a matter for you, Mr. Jones. I don't know what will happen, of course. The judge may have you, or him, up for contempt". The whole thing is quite chaotic, but that is the situation, the realistic situation, now in court and I would suggest that it is quite ridiculous.
The rule enshrined in this amendment is perfectly simple and follows the speeches of the noble and learned Lord, Lord Scarman, the noble and learned Lord, Lord Simon of Glaisdale, and the Law Commission's draft Bill which has already been referred to. It says quite simply that once documents enter the public domain the contents become public knowledge and that then the obligation of confidentiality ceases. This is the point which was ignored by the noble and learned Lord, Lord Rawlinson. It does not matter, and it is totally irrelevant, what use is made of the document once it comes into the public domain. Its use may be good, bad or indifferent. The point

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that has to be made is that confidentiality perfectly properly applies to the private litigant and to the solicitor and counsel concerned until that moment is reached. When that moment is reached there is nothing to be confidential about. There cannot be any obligation of confidentiality. And, once it enters the public domain, then of course the other great principle applies: that it then no longer continues to be the private right of the litigant but becomes the public's right to freedom of comment, information and ideas.
A little time ago, during the passage of the contempt Bill your Lordships will remember that, despite the very strong and exhilarating opposition of the noble and learned Lord who sits on the Woolsack, your Lordships passed an amendment to the contempt Bill which guaranteed the freedom of the public when serving as members of a jury not to be molested and not to be put under pressure as to what went on in the jury room. That amendment enshrined the freedom of every person in this country who does that job to be free of that kind of pressure and molestation. Here, I would venture to say, is the other side of the coin. Here is the guarantee of public freedom of comment and expression which should be guaranteed to the public, as opposed to the sectional interest and protection of the Minister, or of the civil servant, or of whoever it may be who would be embarrassed to have a matter commented upon.
Over and over again when I have appeared for a shoplifter or a gentleman who has unfortunately found himself in a public lavatory charged with a wretched offence, the accused has said to me,"I shall be fined £5 if I am found guilty. Some 99 out of 100 of these cases are never published in the newspapers. How am I going to keep my name out of the press? I happen to be captain of the cricket XI of the local village. I shall get publicity and I shall be completely ruined, whether I am found guilty or not guilty." One has to reply, "No, alas for you, but not for everybody else, matters which are pursued in the courts of law in this country are public and the public have a right to know what goes on. They are entitled to comment on and write articles about what goes on in the courts." So why should the Home Office or a mere Minister be placed in a better position than the ordinary member of the public who unfortunately finds himself in a situation which, for him, is far more dreadful than the one facing the persons involved in the Harriet Harman case? I strongly urge your Lordships to support this amendment.
Lord Gardiner: As it was through no fault of my own that I was unable to be present at the Second Reading of the Bill, I hope that your Lordships' House may forgive me if I congratulate most warmly the noble and learned Lord the Lord Chancellor on this splendid Administration of Justice Bill. It is the usual way of trying to keep the law up to date. It is always very varied in its contents. I believe that I had such a Bill in most years, but I never attempted one so ambitious as this. Its size is enormous and must have involved an enormous amount of work both for the noble and learned Lord and for many members of his staff. I warmly congratulate him on it.
As the noble and learned Lord the Chancellor has said, one of the difficulties there always is about
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Administration of Justice Bills is that, on the one hand, because such a Bill's contents are so varied, the long Title has to be very wide, so it is almost impossible to say that any amendment proposed dealing in any way with the administration of justice is out of order. On the other hand, the Lord Chancellor has always had to promise his colleagues that the Bill is not going to take up a great deal of time. Obviously, this creates a great number of difficulties; not, I hope, in the case of this Bill because the noble and learned Lord has undertaken (as the Attorney General repeated on 25th February in the other place) that after the judgments had been given in the Harman case he would review this point.
I, too, for reasons which have been given already, find the present position really absurd. As the noble and learned Lords, Lord Scarman and Lord Simon of Glaisdale, said in their judgment:
"A distinction between use of a transcript containing the documents and the documents themselves would be absurd. Take the present case. Miss Harman could be sitting at her desk with the copy bundle of disclosed documents by her left hand and a transcript of the trial proceedings by her right hand".
If I may say so in parenthesis, although the noble and learned Lord, Lord Rawlinson, talked about tricks and questionable practices, it should, I think, be emphasised that all parties have agreed throughout that Miss Harman acted with complete integrity. The judgment goes on:
"She would not offend if she handed the journalist the transcript containing the record of the documents as and when read out in court, but would be guilty of contempt of court if she gave him the self-same documents extracted from the bundle of documents made available on discovery. A guilty left-hand and an innocent right hand? Rights and duties in the field of fundamental freedoms cannot depend upon such distinctions".
I wish to take a rather different point in the main, and that is the difficulties I believe we are getting into about the European Convention. I know that the noble and learned Lord the Lord Chancellor has always said that if we enter into an international treaty we are morally bound to comply with its terms, and the European Convention is such a treaty. Indeed, when opening the Second Reading of the Contempt of Court Bill on 9th December 1980, the noble and learned Lord the Lord Chancellor said (Official Report; col. 660.):
"There are three main purposes in the first six clauses: first, to implement the main recommendations of the Phillimore Report with what I hope to persuade the House are minor deviations; second, to harmonise the law of England and Wales with the majority judgment of the Strasbourg court in the Sunday Times case".
The noble and learned Lord's closing words before the Bill went to another place on 17th February 1981 (Official Report, col. 592.) were:
"I regarded it as a matter of enormous importance that we should legislate Phillimore now at last after 10 years, and that we should conform with the European Convention as it was decided by a majority of 11 judges to 9 to be the law of the European Convention".
As both the noble and learned Lord, Lord Scarman, and the noble and learned Lord, Lord Simon of Glaisdale, pointed out, it is at least doubtful whether, in our present law, we do not contravene the provisions of that convention. They said:
"We confess that we find none of the grounds adduced in aid of the alleged exception sufficient—alone or cumulatively—to justify what appears to us to be a discriminatory and unnecessary

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exclusion of the litigant and his solicitor from the exercise of a right which is today a fundamental freedom recognised by the common law and required by the European Convention to be secured to everyone within the United Kingdom".
Later, they had said:
"If English law should recognise this exclusion, it might well be inconsistent with the requirements of the European Convention".
I hope that we are not going to get into the practice of having to pass legislation to overrule the House of Lords in its judicial capacity in order to comply with the terms of the European Convention. I should have thought that if you have the state of affairs which you certainly have here, where, putting it at its lowest, it is very doubtful whether it does not contravene the European Convention, then when we have to consider this question today, that at least is a factor we ought to take into account.
8.18 p.m.
Lord Hunt: Having read the judgment of your Lordships' Appeal Committee on the case in question and having listened very carefully to the arguments, and particularly the arguments advanced by noble and learned Lords this evening, I should like to tell your Lordships that I propose to vote for this amendment and to explain very briefly why. One abiding conviction which has remained with me during the five years since the Royal Commission on the Press reported to the Government in 1977 has been the key position, in all our freedoms, of the freedom of the press, despite its manifold imperfections. Whatever the substance of the conclusion reached by the noble and learned Lord, Lord Diplock, in the majority judgment of the legal committee as to the relevance or otherwise of the freedom of the press to that particular case (and I am persuaded that it was entirely relevant), this amendment —and surely this is the point that we are discussing this evening—is about the freedom of the press.
Nothing can alter my conviction that, when a document has been read out in open court without any restrictions on reporting, three things should follow: the public has a right to know the contents of that document, the press has a duty to make its contents known to the public, and those who hold the documents should be entitled to make them availabe to the members of the press to make quite certain of the accuracy of their reporting.
As to the arguments in support of the law, as I understand the judgment, as it stands, and those arguments which seek to draw distinction between the permissibility of quoting from a transcript and the impermissibility of quoting from an original document, I would just say, without any personal intention to cast aspersions, that it is just arguments such as those which make the law an ass in the public eye. I would go further and say that it is arguments such as those which risk bringing the judiciary themselves into contempt.
I regard this amendment as important, and I think it is an amendment which is necessary to pre-empt, to obviate the danger of further damage being done to the high repute of the law; and Heaven knows that is very important today in respect of those people who are only too anxious to seize on opportunities such as this to bring the law into contempt and the judiciary into disrespect!
Lord Jacobson: May I declare a three-fold interest; I am a life member of the National Union of Journalists, a former member of the Press Council, and an ex-editor. It is in the last capacity that I want very briefly to stress what some of my noble friends on this side have said, that the attempt to draw distinction between court reporters and news reporters and feature writers or leader writers, is so totally artificial and irrational that it simply will not work. I am quite sure that the press itself will find ways of making it unworkable and what will happen, unless this amendment is accepted, as the noble Lord, Lord Hunt, has just said, is that it will make the law and those who have to administer it look very foolish indeed.
Lord George-Brown: May I just ask this? Why should it be that if you draw a distinction between those who report what is happening, what has happened, and those whom my noble friend calls feature writers, people who are paid to make fun of the thing, that makes the law an ass? It seems to me that what you do is to draw attention to the instinctive desire of some who want to sell newspapers to make the law look an ass. We are, many of us, accustomed nowadays to some journalists who gain spurious repute and Oscars for writing what are supposed to be rather amusing columns in the Daily Telegraph and in the Guardian on the proceedings of this House. There is a very great difference between what they write and what the reporters of this House write.
With the greatest respect to my noble friend Lord Jacobson, he is asking us to act as though those differences do not exist. Making fun of the law, making fun of this House, is one thing; straight reporting is another. Unless I misunderstand the point of this amendment, its effect would be to distinguish the Gilbert and Sullivan writers and diminish those who do straight reporting.
I frankly confess my view. Straight reporting is one thing, straight reporting I will defend, but the right of people just to make fools out of everything is one of those things which help to diminish the whole morality of today. With great respect to Lord Jacobson—my noble friend, as in days before either of us was ennobled—I do not think that really can stand any defence at all. Reporting is one thing; diminishing, destroying is quite another thing altogether. This is the news that was not. It is quite different from presenting this is the news. I hope this amendment will be rejected.
Lord Jacobson: My noble friend Lord George-Brown has suffered at the hands of the press in the past, and I think this has given him a rather jaundiced view of the whole of the newspaper profession. I was not trying to suggest that giving feature writers access to documents that had already been declared in court, and to which law reporters and news reporters have access, should be made fun of. The point is this. Where a matter of serious public interest, as in the Harman case, arises, access to such documents will help to preserve the accuracy of writing which seeks to comment on and to analyse that particular case. It has nothing to do with light-hearted columns about Parliament or anything else.
Baroness Jeger: I put my name to this amendment because I think it is fundamental to the freedom of the press in this country. I should like to start by saying that there would have been more Members of your Lordships' House on these Benches tonight had it not been that in another part of the Palace of Westminster at this very time there is a memorial meeting going on to our late friend Lord Ritchie-Calder. I know he would have supported this amendment tonight, because I discussed it with him not many sad weeks ago. I felt that I should be here rather than attending the meeting, at which I would have very much liked to be present.
I must declare an interest as a life member of the National Union of Journalists; and I am very grateful for what the noble Lord, Lord Jacobson, has said, because it seems to me that, especially from the speech of the noble and learned Lord, Lord Rawlinson, some of your Lordships do not know how newspapers work. I speak with trepidation with my old editor, Lord Ardwick, at my side but I can recall, in the great and glorious days when the Manchester Guardian was the Manchester Guardian and we had only a small office in London, that he would send me to do a court report in the morning, to go and see what was happening to a cat up a tree in Golders Green in the afternoon, and to review a play in the evening.
I am sure that the idea that it is possible in law to discriminate between the law correspondent, the court correspondent and the general reporter, or the feature writer, is totally unreal. I must explain and emphasise that if it is unreal on national papers, it is certainly quite unreal on local papers. Local papers, working with a small staff, will send a reporter to do all sorts of jobs, and they will say to him in the evening,"Goodness! There is nothing for that page 3 feature tomorrow. Will you knock out something?"The idea that it should be entrenched in the law that one type of reporter is different from another, is quite impractical and quite unacceptable. I speak as a layman, but I think that if the law does not make sense to laymen then the law cannot command public respect.
Lord George-Brown: With great respect, the noble Baroness does not speak as a layman: the noble Baroness speaks with a privileged interest. What I do not understand is why the self-declared 100 per cent. members of the National Union of Journalists—I speak as a 100 per cent. fully paid up member of the Institute of Journalists—come along with a party position and then try and address us as though they are laymen. Of course all of us who earn the whole or part of our living by journalism know the difference between straight reporting and commentating. May I ask the noble Baroness why it should be so difficult for anybody engaged in journalism to distinguish between straight reporting and commenting?
The Lord Chancellor: May I say something? I have such fun being on this Front Bench and not over there. I did think that the noble Baroness, Lady Jeger, was making a speech and when the noble Lord intervened I was wondering who was making a speech about what, to whom. I wonder if perhaps the Committee would let the noble Baroness get on with it?
Baroness Jeger: As we are in Committee I was speaking to an amendment to which I have put my name. I think that I must be in order. It may be that other Members of your Lordships' Committee are not in order, but I cannot see how I am being disorderly in what I am saying. I shall not take up the Committee's time by going into detail in answering what the noble Lord, Lord George-Brown, has said because of course we all know that there is this type of all-round reporting—the odd job that anyone who works on a newspaper has to do. It is quite impossible in law to make these differences apply.
I cannot help but wonder whether, if the article about the Home Office in this case had been favourable to the Home Office, the case would have ever been brought. This is what gives all of us who care about the freedom of the press a reason to feel very concerned about the situation in that case. We see this amendment tonight as a way of putting things right. We are really talking about shorthand. We are talking about how good is a reporter's shorthand. We are saying to a reporter"If you take this down verbatim with your splendid shorthand in your shorthand notebook"—and mine is very rusty—"and go back to your newspaper and type it out", then"that is all right"; but if a journalist goes up to one of the people who has the documents and says,"Look, my shorthand is a bit rusty, can I check what I have got against the documents?", then that is illegal. My friends, that does not make sense to ordinary people. I am only concerned about what makes sense to ordinary people.
Therefore, I very much hope that this amendment will be accepted tonight because I know that there is a great deal of anxiety in all quarters of the Committee about the present ruling. I would only like to add that I think that it was a question of public importance for the case to go to appeal. But I think that it is very unfair that the very heavy costs are having to be borne by the National Council for Civil Liberties, because if it was a matter of public interest for this problem to be sorted out, then I do not see why the Home Office should not have made some contribution to the expenses in this case. For those reasons I shall not delay your Lordships any further. I very much hope that the amendment will be accepted.
The Lord Chancellor: I do not know whether it is time for me to say something or not, but I hope that I may be forgiven if I do so. I venture to think, with great respect, that this is a little more difficult than some people have thought. Everybody who has spoken has said, "I am not a lawyer, I am only a journalist" or "I am not a journalist, I am only a lawyer". They all have various coloured axes to grind. I am always frightened of disagreeing with the noble Lord, Lord Gifford. I always feel that if I disagree with anything that he says, somebody like Jupiter above the ceiling will drop a thunderbolt on my head, because the noble Lord is always so passionately attached to his causes.
I have always wanted all my life to sit on a jury. But, of course, when the noble Lord, Lord Hutchinson of Lullington, addresses the House he always addresses us as if we were all jurors and so I now know exactly what it is like to be at the receiving end of the noble Lord, Lord Hutchinson of Lullington, when he is at

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the Old Bailey. But the fact of the matter is that he was wrong about two or three things which he said and I think that I must try to put him right.
First of all, the noble Lord is one of the most distinguished, if he will allow me to say so—and I declare an interest of which he knows—criminal practitioners at practice in the English Bar. But this case about Harman, the Home Office and Williams was not at all about criminal law in the first place. There is no such thing as discovery in the criminal law. It was basically a case about the use which solicitors make of documents which are extracted from the other side on discovery. So I think that we can forget about that.
Secondly, he appeared to be under some kind of illusion that the Home Office was claiming a special kind of privilege. Of course the Home Office was claiming at an earlier stage when it appeared before Mr. Justice McNeill a special kind of Crown privilege, but in fact the amendment—which is, after all, what we are supposed to be talking about—is not concerned with Crown privilege at all. It could he as applicable to a case between John Smith and Rupert Brown as between the Home Office and Miss Harman on the information of the Attorney-General.
I think that all the journalists and lawyers who have been talking should realise that what is really at stake is ordinary litigation between ordinary people in the way that it is carried on in the civil and not the criminal courts. A great deal of the argumentation which has been presented about this is based on a totally fallacious idea about what it is. With great respect, to the noble Lord on the Cross-Benches, I am not going to enter into the argument as to whether there is a difference between a feature writer and a court reporter. I think that there is a distinction, but for the purposes of what I want to say we can forget about that.
Supposing in the course of litigation—and I put this to the lawyers and not to the journalists for a reason that I shall give—something extremely unpleasant between two absolutely ordinary private citizens is read out in court about an innocent third party? Curiously enough this is one of my preoccupations about the matter. Supposing the press does not take it up at all so that no journalist is even involved in it? But supposing somebody for the purpose of harassing that third party, happens to have got a confidential document in the course of discovery? I am not making any allegations against poor Miss Harman and I hope that the noble Lord, Lord Gifford, will not throw his thunderbolts at me for that or, indeed, my noble and learned friend. In fact, almost everybody who has taken part in this case has appeared for me at one time or another. But I hope that your Lordships will realise what this amendment would do. It would mean that if it were read out in open court, the confidential document could be used six months later for any purpose, however malicious and however ruinous to the innocent third party.
Lord Avebury: Will the noble and learned Lord give way?
The Lord Chancellor: Yes, I shall in a moment. The point I am trying to make is that you do not realise that this is a little more complex than you think, and that it has nothing necessarily to do with the
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freedom of the press. What it has to do with is the use you make of documents extracted on discovery.
Lord Avebury: Does the noble and learned Lord agree that this is how the law was sought to be until the decision to which we are now addressing our minds and, therefore, because the specific evil which he mentions to your Lordships has never, in fact, arisen, the danger is non-existent?
The Lord Chancellor: I do not think that the danger is non-existent. I have perhaps a wider experience of litigation than the noble Lord, and I have known it exist. Since I have been Lord Chancellor I have had to address a seminar of judges on this kind of problem. Therefore, I do not agree about that at all.
Perhaps I may continue to make my own speech in my own way. You must realise that the privileges of the press are very precious to them, and quite rightly, but they are only the privileges, such as they are, of the ordinary individual. Misconduct by the press may be more ruinous than misconduct by a humble individual like myself, but, in fact, we are talking about the use made of documents. The amendment, of course, deals with information, but the case of Harman was actually about the use made of documents extrinsic to litigation; about possibly innocent third parties who may not be able to defend themselves at all.
I hope that that indicates that the problem is perhaps a little more complex than these enthusiasts have been trying to make it appear. It is not only to do with the freedom of the press. I do not want to be accused by the noble Lord, Lord Gifford, of having done the very thing of which I have accused him, but I think that he was being a little cavalier when he referred to a decision made by Mr. Justice Park, three Lord Justices of Appeal, including the Master of the Rolls, and three Law Lords, as having the head and ears of an ass. I shall not say that it is disrespectful; he is entitled to be as disrespectful as he likes in this place, fortunately for both of us. But I think that he was being a little arrogant, if he will forgive me for saying so. These people are not asses. They are, in fact, people who have given the whole of their lives to the administration of justice. One is entitled to say that they are wrong. I must say, I doubt whether the noble and learned Lord, Lord Scarman, and my noble and learned friend Lord Simon of Glaisdale would have been particularly pleased to be called the lion's tail. I am a great admirer of lions, but I think that the tail is the last part of the lion that I would glorify. Therefore, I do not think that they are complimented either.
I should like to thank in particular the noble and learned Lord, Lord Gardiner, for the kind things that he said about this very long, complicated and technical Bill. I am trying my best to get through it, an aspect which people have rather lost sight of in some of the va et vient of this particular debate, which has now been going on for 71 minutes. However, I think that the general even-handed way in which I have proceeded has been to say that no hobby-horses ought to be ridden in this Bill, excellent as some of them are and less excellent as some of the others are.
I should like to return the discussion to what the noble Lord, Lord Gifford, said almost at the opening.

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He reminded me of a promise that I made on the Contempt of Court Bill. To quote my own words:
"All I can say is that when this question of appeal is out of the way one way or another, which will be long or short according to what happens, I will put it to my Department and discuss it with colleagues, but without any undertaking as to what may emerge". —[Official Report, 10/2/81; col. 181.]
That undertaking stands. I gave that undertaking to the noble Lord and I am a man who tries to be a man of his word. I intend to abide by that promise both in the spirit and in the letter. I do not want to take very violent sides about this. I want to disabuse some people of some fallacies, but I mean what I say. I repeat that promise. Perhaps I can say, without a breach of confidence, that only today I spoke to the noble and learned Lord, Lord Scarman, about it. He is the chairman of the Law Reform Committee. He would not, of course, like to preside at this particular inquiry, for reasons which may occur to those who have read the judgments in the case, but he did put certain ideas before me and I should like to have this matter properly investigated. That promise stands irrespective of the merits or otherwise of the amendment.
However, I venture to think that this is a little more difficult than is thought. Persons not party to the litigation may be seriously prejudiced by the use of information disclosed about them on discovery. That was not a point raised in the Harman case but it was a point raised in the case of the Church of Scientology. It is all very well for the noble Lord, Lord Avebury, to tell me that I am tilting at windmills with imaginary fantasies, but this is one of the things that can happen. It was precisely the point that was raised in the Scientology case.
There is, of course, the importance which the noble Lord, Lord Gifford, rightly attached to the rather delicate business of extracting confidential documents out of one's own client on discovery, to which the legal profession attaches the very greatest importance. I know that I shall be borne out in that by at any rate every civil practitioner at the moment in the Committee. It is very difficult to persuade a commercial firm for which one is appearing that one is not really betraying its interests when one tells it that the damaging documents which one found in its secrets files have ultimately to appear in its affidavit. I think that the Law Society and the legal profession—and I thought that my noble and learned friend Lord Rawlinson was probably speaking for a majority of them—doubted whether the amendment as at present conceived could be reconciled with the importance of maintaining the rigour—and it must be rigorous—of discovery in respect of confidential documents.
The question of confidentiality is one of very considerable public interest and I am bound to say that I agreed with a document from the Law Society which commented on this particular amendment but in the context, not of the Law Committee's Report, but of the Law Commission's Report No. 110 on Breach of Confidence, which was published in October 1981, and on which the Government have not yet taken a line and upon which public comment is still open. The document itself is very much too long for me to quote, but I should like to quote a slightly long passage because, if I may be forgiven for saying so, I am talking to this audience of enthusiastic lawyers and journalists and I am trying to represent, for once, the common man.
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I thought that the Law Society made some rather shrewd remarks about the so-called Harman amendment. It said:
"…it is not clear that it hits the target of altering the law of contempt of court as declared by the majority of the House of Lords in Home Office v. Harman. It seems to us that it needs to be considered in the context of the present study of the Law Commission's Report and draft Bill, whether or not this further step ought to be taken".
It went on:
"The question is put in the minority opinion of Lord Scarman and Lord Simon whether it can be good law that the litigant and his solicitor are alone excluded from the right to make that use of the documents which everyone else might now make, namely, to treat them as matters of public knowledge".
"It seems to us that, whether it is regarded as a matter of breach of confidence or of contempt of court, the answer to this question must probably be "No," but before the law is altered to this effect the consequences for the conduct of litigation need to be carefully considered. May it not inhibit disclosure by parties in the first place? Might a court not be influenced against ordering disclosure of sensitive documents by the consideration that they could subsequently be used for other purposes in this way?"
We know that Mr. Justice McNeill in the Harman case did say that he was influenced because he thought that he could trust the parties who had the documents not to use them in this way.
"Would it be necessary, for instance, for solicitors preparing lists of documents for affidavits or giving discovery to consider on each occasion whether a special order should be sought effectively restoring the present implied undertaking not to use documents otherwise than for the purpose of the litigation? Would an incentive be created for counsel or litigants in person to read out documents in open court for the sole purpose of removing them from the scope of the implied undertaking? There is also the point made by Lord Diplock that, although the contents of a document once read out in open court are technically in the public domain, the litigant or solicitor in possession of the document itself is at a considerable advantage over those who merely had access to notes or transcripts of what was said. We suggest that these matters should be considered in the course of the current study of the Law Commission's report and draft Bill, on which there appears to be a reasonable prospect of early legislation".
Those are very shrewd words by the Law Society. They are pretty good stuff. When I am threatened with the European Convention I cannot complain of course because I did exactly the same to the noble and learned Lord, Lord Elwyn-Jones, over the closed shop, and it turned out I was correct in my prognosis. I cannot predict what the Strasbourg court will say, but I must say this at any rate that Article 10 of the convention expressly protects the disclosure of information received in confidence, or for maintaining the authority or impartiality of the judiciary. I would not be even so doubtful as the noble and learned Lord, Lord Gardiner, about what the Strasbourg court might say if in one form or another—it may be in this or in some other form—they should attempt to litigate if this point were brought to them.
The amendment does not apply to Scotland in terms, but would it not be a good thing to consider whether, and to what extent, the Scottish law should be the same as ours in that respect? It does emphatically apply to criminal proceedings, but it is just there that it would, in my judgment at any rate, be least valuable because there is no discovery in criminal proceedings.
What I should like to say to the noble Lord is that it is pretty clear to me that this is a fairly difficult matter. I had promised to look into it when the litigation was over, and it has been over for only six weeks

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or so. The chairman of the Law Reform Committee is none other than one of the two noble and learned Lords who were party to the dissenting judgment. I really think that I am not going too far when I ask the Committee, now having spoken for some time myself—it is now 81 minutes since we started—to allow me to keep my promise and not to pass an amendment which will prevent me from keeping it.
Lord Mishcon: We have had an example tonight, if I may say so, of the loss to the Bar when the noble and learned Lord decided to leave the arena and grace the Woolsack. He accused—I do not think it was meant really as an accusation—the noble Lord, Lord Hutchinson, of addressing this Committee as though it were a jury. But I have never heard such a magnificent jury display in my life, coupled with the fact that the noble and learned Lord did something that many advocates cannot do; he made his jury laugh in the course of a serious speech.
However, we have to get back to the reality of this amendment. The noble and learned Lord pleaded for time in order that he might consider whether the law of England and Wales and Northern Ireland should become the same as the law of Scotland. When I was begging of him a week ago in regard to another Bill for which he was responsible to please consider that the law of Scotland was rather different and was in accordance with my amendment, with great fortitude and terrific eloquence he persuaded the House that it was a nonsensical point; that Scotland kept their own law and it was right that they should, and it was quite ridiculous for me to assume that the law of Scotland should be the same as the law of England in this respect. So you see yet another example of a wonderful advocate and what he can do from week to week in regard to the arguments that he presents.
If I may, as the time is late, I should like to emphasise the points that are made here. It is not a question of the sensitivity of Mr. Smith and Mr. Robinson in any proceedings. Indeed, their sensitivity is unfortunately outraged at the present moment in civil litigation because if a reporter happened to be in court, as has been mentioned, and takes down the confidential document, he is at perfect liberty to print what he likes, publish what he likes, subject obviously to what he may say and the law of defamation. If, however, he is not quite certain that he has got it accurately and goes up to the solicitor and says, "Your counsel read out in open court a document. I like being an accurate journalist; I like being a truthful man. I do not want to be unfair. Could I please check the contents of this document with you?" He cannot do it. Hardly in protection, you may think, of either Mr. Robinson or Mr. Smith, or the great idol of truth and accuracy that we all try to worship in our profession of the law and I hope in the ordinary conduct of our business.
It is even absurd to this extent, if I might make the point that I do not think has been made before—I am not going through the various parties who might come up by way of newspaper people to the advocate—if the solicitor happens to have a transcript subsequent to the court proceedings, because you cannot imagine that he has got the transcript in front of him at the court proceedings unless it be in respect of a previous day's
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hearings, and if he shows the transcript which quotes the document, he is in accordance with the law—I am sure that the noble and learned Lord would confirm this —and is doing something that is absolutely in order. But if he does not take it from the transcript but refers to the bundle of correspondence in the case, then indeed he is doing something according to the majority decision of the House of Lords sitting in the Committee of your Lordships' House in their judicial capacity.
It is not by way of being offensive to any judges who have looked at this matter; it is not in the case of Harman that we are talking about this amendment tonight; that is purely a case that happens to have highlighted something that needs reform. The noble and learned Lord will go down in history as a great Lord Chancellor and as somebody who, I am sure, likes to have the law in a state which commands the respect of everyone, and he wants to put a house in order. Sometimes he finds it difficult with his colleagues to let him have the amount of time that he ought to have in order to amend the law when it needs amending. I suggest to your Lordships that tonight we assist the noble and learned Lord by passing this amendment, and seeing to it that his glorious history is carried one stage further to put the law right as I know he would want it to be.
9 p.m.
Lord Gifford: My first and least pleasant task at the end of this excellent debate is to answer the extraordinary attack made by the noble and learned Lord, Lord Rawlinson, on those who had conduct of the case against the Home Office out of which the Harman case arose. His attack was launched principally against the advocate who read out the documents in the case and it was implied that that barrister was guilty of tricks and manoeuvres in order to get into the public domain things which otherwise would not have been. The noble and learned Lord knows full well that the trial judge in any case has the right and duty to exclude from public hearing—to exclude, be they in the form of questions or documents—matters which are irrelevant to the issues in the case.
Is the noble and learned Lord aware that no protest was raised by the Home Office that irrelevant documents were being read out and that no attempt was made by the trial judge in the Williams case to stop Mr. Sedgeley, the barrister, opening it, from reading the documents which later became the subject of the Harman case? In the light of that, I invite him to withdraw the allegation he made against that counsel. I see that the noble and learned Lord remains in his place, and I continue only to answer one other matter which he raised about Miss Harman, implying that her disclosure of the documents was without any authority. That is not the case. She, like any other solicitor, had no business to be talking to the press unless she had her client's authority, and she had it; so that attack also was unfounded and should be withdrawn.
The main point made by the noble and learned Lord the Lord Chancellor in answer was that the process of discovering documents leading to publication in a court of law could be damaging to people's privacy and feelings. Of course, it can. So can the evidence which comes out in a court of law. But what those of us who support the amendment are defending is the

205
public quality of trials in courts, and we cannot allow some kind of censorship to operate between matters which can be disclosed once they have been published in a court of law and matters which cannot be.
Many noble Lords have made play of the different kinds of law reporter, and perhaps a further example is relevant from my responsibility and experience. As the Lord Chancellor knows, I am chairman of a group called the Legal Action Group, which publishes a bulletin. It has grey pages, which seek to edify the legal profession by reporting on the law, and it has white pages, in which there are feature articles about the law. If the Legal Action Group reporter were in court it would be difficult, even for the noble Lord, Lord George-Brown, to say whether he was a law reporter or feature writer when he was listening to the trial.
The main point that has come out of this debate is that many of your Lordships are deeply worried about the image of a law as it has emerged from the House of Lords on this issue, and I do not repent having made disrespectful comments about the quality of judgment of those judges and noble and learned Lords who found for the Home Office. I am heartened by the sense that many noble Lords feel—for example, the noble Lord, Lord Hunt, and my noble friend Lady Jeger—that the judges really have made an ass of themselves in this case and brought the law into disrepute. That is why those of us who support the amendment wish to have the issue overturned with the minimum of delay.
Having said that, I come to the plea of the Lord Chancellor that he would wish to have time to look at all the implications of the issue. Of course, he should look at all those implications, but let him look at them, we having passed the amendment as if the minority in the House of Lords had been the majority, and then let him and us see whether any change in the law is needed. With an amendment which is clear in its terms and which nobody has denied would have the effect of putting the law into the position which the minority in the House of Lords would wish to see it put, let that be the law and then, if there be any further need for examination, let that be done thereafter. There is no need for delay. The issue is not obscure and I ask your Lordships to vote for the amendment.
9.5 p.m.
On Question, Whether the said amendment (No. 52) shall be agreed to?
Their Lordships divided: Contents, 44; Not-Contents, 44.

DIVISION No. 1

CONTENTS

Airedale, L.

Glenamara, L.

Amherst, E.

Hacking, L.

Ardwick, L.

Harris of Greenwich, L.

Avebury, L.

Houghton of Sowerby, L.

Aylestone, L.

Hunt, L.

Bishopston, L.

Hutchinson of Lullington, L.

Blease, L.

Jacobson, L.

Boston of Faversham, L.

Jeger, B.

Brockway, L.

Jenkins of Putney, L.

Collison, L.

John-Mackie, L.

David, B. [Teller]

Lee of Asheridge, B.

Davies of Leek, L.

Llewelyn-Davies of Hastoe, B.

Gardiner, L.

Gifford, L.

Lockwood, B.

206

McGregor of Durris, L.

Sefton of Garston, L.

McNair, L.

Stewart of Alvechurch, B.

Mishcon, L.

Stewart of Fulham, L.

Monson, L.

Underhill, L.

Ogmore, L.

Wade, L.

Oram, L.

Wedderburn of Charlton, L.

Pitt of Hampstead, L.

Wilson of Langside, L.

Ponsonby of Shubrede, L. [Teller]

Winstanley, L.

Wynne-Jones, L.

NOT-CONTENTS

Airey of Abingdon, B.

Hylton-Foster, B.

Aldenham, L.

Inglewood, L.

Avon, E.

Lindsey and Abingdon, E.

Beloff, L.

Long, V. [Teller]

Belstead, L.

Lyell, L.

Cathcart, E.

Mackay of Clashfern, L.

Cockfield, L.

Macleod of Borve, B.

Cork and Orrery, E.

Mansfield, E.

Cullen of Ashbourne, L.

Marshall of Leeds, L.

De La Warr, E.

Mersey, V.

Denharn, L. [Teller]

Monckton of Brenchley, V.

Drumalbyn, L.

Monk Bretton, L.

Elton, L.

Mottistone, L.

Ferrers, E.

Murton of Lindisfarne, L.

Fortescue, E.

Newall, L.

Gainford, L.

Rawlinson of Ewell, L.

George-Brown, L.

Renton, L.

Glanusk, L.

Rochdale, V.

Glasgow, E.

Sandys, L.

Glenarthur, L.

Skelmersdale, L.

Grimston of Westbury, L.

Stanley of Alderley, L.

Hailsham of St. Marylebone, L.

Trumpington, B.

The Deputy Chairman of Committees (Lord Hayter): There have voted, Contents, 44; Not-Contents, 44.
There being an equality of votes, in accordance with Standing Order No. 53, which provides that no proposal to amend the Bill in the form in which it is before the Committee shall be agreed to unless there is a majority in favour of such amendment, I declare the amendment disagreed to.
9.13 p.m.
Clauses 61 to 64 agreed to.
Clause 65 [Transitional provisions and savings]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 53:
Page 35, line 19, after ("or") insert ("paragraphs 2 to 10 of").
The noble and learned Lord said: This is a drafting amendment to resolve an inconsistency between subsection (1) of Clause 65 and subsection (9) of the same clause. I beg to move.
On Question, amendment agreed to.
Lord Mishcon Lord Mishcon moved Amendment No. 54:
Page 35, line 21, leave out ("above").
The noble Lord said: I feel it almost impertinent to put this amendment to the Committee, but do we need the word, "above"? It is most unusual (is it not?) when referring to a section of an Act; it obviously is above. I beg to move.
The Lord Chancellor: I had better read out my brief. I hope it will make the noble Lord laugh, because it makes me laugh. This is a drafting amendment suggested by the Law Society, which claims that

207
"above" in Clause 65(2) is superfluous. The use of the expression "Section 6 above" is a standard draftsman's device. Practice in this respect varies between draftsmen, and some no longer use "above" and "below", which is the more traditional method. If the present amendment were made to Clause 65(2), similar amendments would have to be made throughout the Bill; for instance, in Clause 39(2) and (5), Clause 40(1), Clause 42(3), Clause 44(1), and so on. Such an exercise would be pointless.
That, I think, is all I need read. I do not think the Government will fall if this amendment is passed, but I hope the noble Lord will withdraw it.
Lord Mishcon: My Lords, having proposed this earth-shaking amendment and having heard the earthshaking reply, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
9.15 p.m.
Viscount Long Viscount Long moved Amendment No. 55:
Page 35, line 37, after ("Act") insert ("other than the repeal of section 5 of the Damages (Scotland) Act 1976").
The noble Viscount said: This amendment gives effect to a subsidiary recommendation of the Scottish Law Commission Report No. 64. The new rules of court which will replace Section 5 of the 1976 Act will come into operation immediately this Act comes into operation, even in relation to those actions which are in progress and have been started on the basis of the present Section 5. It has been considered that, since the proposed reform is purely procedural, the usual rule, that actions which are in progress should be completed under the old law, is not appropriate.
The amendment will mean, moreover, that a good deal of abortive work can be avoided. I daresay solicitors faced with the formidable task of tracing relatives under Clause 5 will breath a sigh of relief when the commencement date of the new rules of court is announced. I beg to move.
On Question, amendment agreed to.
Clause 65, as amended, agreed to.
Clause 66 agreed to.
On Question, Whether Clause 67 shall stand part of the Bill?
Lord Renton: At this stage I apologise for uttering a word at all, but, even though I cannot expect a reply, I should like to draw attention to the really rather unsatisfactory method of bringing so many different provisions of the Bill into operation in so many different ways. This clause seems to me to be an unnecessarily complex one, and I hope that on future occasions, at any rate, Parliamentary Counsel will endeavour to advise Ministers to bring their Bills into operation in a less complex manner.
The Lord Chancellor: I thank my noble friend. I am sure Parliamentary Counsel will take to heart his wise and prudent remarks, but, as he rather anticipated, I cannot go into any detail at this moment.
On Question, Motion agreed to.
Clause 68 [Extent]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 56:
Page 38, line 21, at beginning insert ("Subject to subsection (6) below,").
The noble and learned Lord said: This is a very minor drafting amendment, which makes it clear that Clause 68(1) is subject to Clause 68(6). I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 57:
Page 39, line 4, leave out from ("or") to ("extends") in line 5 and insert ("amended or instrument revoked by this Act extends to any part of the United Kingdom, the repeal, amendment or revocation").
The noble and learned Lord said: This is a drafting amendment to prevent any ambiguity. I beg to move. On Question, amendment agreed to.
Clause 68, as amended, agreed to.
Clause 69 agreed to.
Schedule 1 [Citation]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 58:
Page 40, line 6, leave out ("where there are") and insert ("in").
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 59:
Page 40, line 9, leave out from beginning to ("for") in line 28 and insert ("there may be included in any sum for which judgment is given simple interest, at such rate as the court thinks fit or as rules of court may provide, on all or any part of the debt or damages in respect of which judgment is given, or payment is made before judgment,").
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 60:
Page 40, line 31, leave out second ("the") and insert ("any").
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 61:
Page 40, line 34, at end insert—
("(1A) In relation to a judgment given for damages for personal injuries or death which exceed £200 subsection (1) shall have effect—

(a) with the substitution of "shall be included" for "may be included"; and

(b) with the additon of "unless the court is satisfied that there are special reasons to the contrary" after "given", where first occurring.").

On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 62:
Page 41, line 14, at end insert ("and personal injuries' includes any disease and any impairment of a persons' physical or mental condition.").
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 63:
Page 41, leave out lines 17 to 38.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 64:
Page 41, line 42, leave out ("where there are") and insert ("in").
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 65:
Page 41, line 45, leave out from beginning to ("for") in page 42 line 18 and insert ("there may be included in any sum for which

209
judgment is given simple interest, at such rate as the court thinks fit or as county court rules may provide, on all or any part of the debt or damages in respect of which judgment is given, or payment is made before judgment,").
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 66:
Page 42, line 21, leave out second ("the") and insert ("any").
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 67:
Page 42, line 24, at end insert—
("(1A) in relation to a judgment given for damages for personal injuries or death which exceed £200 subsection (1) above shall have effect—

(a) with the substition of "shall be included" for "may be included"; and

(b) with the addition of "unless the court is satisfied that there are special reasons to the contrary" after "given", where first occurring.").

On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 68:
Page 42, line 40, leave out ("included") and insert ("calculated").
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 69:
Page 42, line 45, at end insert ("and personal injuries' includes any disease and any impairment of a person's physical or mental condition.").
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 70:
Page 43, leave out lines 4 to 27.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 70A:
Page 43, line 33, leave out from ("words") to ("of") in line 34 and insert (""Section 35A of the Supreme Court Act 1981 and section 97A").
On Question, amendment agreed to.
Schedule 1, as amended, agreed to.
Schedule 2 agreed to.
Schedule 3 [Monetary limits of county court jurisdiction]:
The Lord Chancellor The Lord Chancellor moved Amendments Nos. 71 to 74:
Page 47, line 40, leave out ("county court costs in High Court") and insert ("costs of actions in High Court for small claims").
Page 47, line 41, leave out ("no costs in High Court") and insert ("costs of actions in High Court to recover goods of small value").
Page 49, line 4, leave out ("(c)").
Page 49, line 5, after (""section"") insert (",in the first place where it occurs,").
The noble and learned Lord said: I wish to move Amendments Nos. 71 to 74. They are all drafting amendments to correct minor inaccuracies. I beg to move.
On Question, amendments agreed to.
Schedule 3, as amended, agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 75:
After Schedule 3, insert the following new schedule:
("Administrative and clerical expenses of garnishees

SCHEDULE
  ATTACHMENT OF DEBTS

    PART I
    SECTION INSERTED IN SUPREME COURT ACC 1981
    40A.—(1) A sum may be prescribed which, before complying with an order made in the exercise of the jurisdiction mentioned in section 40(2) —

    (a) any deposit-taking institution; or

    (b) any such institution of a prescribed description or with not less than a prescribed number of branches,

    may deduct, subject to subsection (2) below, towards the clerical and administrative expenses of complying with the order, from any money which, but for the deduction, would be attached by the order.
    (2) The prescribed sum may not be deducted or, as the case may be, retained in a case where, by virtue of section 40 of the Bankruptcy Act 1914 or section 325 of the Companies Act 1948, the creditor is not entitled to retain the benefit of the attachment.
    (3) In this section—
    "deposit-taking institution" has the meaning assigned to it by section 40(6); and
    "prescribed" means prescribed by an order made by the Lord Chancellor.
    (4) An order under this section—

    (a) may make different provision for different cases; and

    (b) without prejudice to the generality of paragraph (a) of this subsection, may prescribe sums differing according to the amount due under the judgment or order to be satisfied.

    (5) Any such order shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.

PART II
SECTION INSERTED IN COUNTY COURTS ACT 1959
143A.—(1) A sum may be prescribed which, before complying with an order made in the exercise of the jurisdiction mentioned in section 143(2) of this Act—

(a) any deposit-taking institution; or

(b) any such institution of a prescribed description or with not less than a prescribed number of branches,

may deduct, subject to subsection (2) below, towards the clerical and administrative expenses of complying with the order, from any money which, but for the deduction, would be attached by the order.
(2) The prescribed sum may not be deducted or, as the case may be, retained in a case where, by virtue of section 40 of the Bankruptcy Act 1914 or section 325 of the Companies Act 1948, the creditor is not entitled to retain the benefit of the attachment.
(3) In this section—
"deposit-taking institution" has the meaning assigned to it by section 143(6) of this Act; and
"prescribed" means prescribed by an order made by the Lord Chancellor.
(4) An order under this section—

(a) may make different provision for different cases; and

(b) without prejudice to the generality of paragraph (a) of this subsection, may prescribe sums differing according to the amount due under the judgment or order to be satisfied.

(5) Any such order shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.").
The noble and learned Lord said: I spoke to this amendment with Amendment No. 51. I beg to move.
Lord Mishcon: I wonder whether the noble and learned Lord has any idea yet of the sums that may be prescribed?
The Lord Chancellor: I could not recite them at this

211
moment, but I will try and let the noble Lord know.
On Question, amendment agreed to.
Schedule 4 agreed to.
Schedule 5 [Damage for personal injuries etc.—Northern Ireland]:
The Lord Chancellor The Lord Chancellor moved Amendments Nos. 76 to 79:
Page 53, line 23, leave out ("substituted for the proviso to") and insert ("inserted after").
Page 53, line 25, at end insert ("(actions to survive death)").
Page 53, line 26, leave out from ("(1A)"to the end of line 29 and insert ("The right of a person to claim under Article 3A of the Fatal Accidents (Northern Ireland) Order 1977 (bereavement) shall not survive for the benefit of his estate on his death.".").
Page 54, leave out line 27.
The noble and learned Lord said: I spoke to these amendments with Amendments Nos. 8, 9 and 10. I beg to move.
On Question, amendments agreed to.
Schedule 5, as amended, agreed to.
Schedule 6 [Amendments of Judicature (Northern Ireland) Act 1978]:
The Lord Chancellor The Lord Chancellor moved Amendments Nos. 80 to 81A:
Page 55, line 12, leave out ("(a)") and insert ("(b)").
Page 55, line 13, leave out from ("requiring") to ("there") in line 16 and insert ("parents of a ward of court to make periodical payments towards the maintenance and education of the ward) after the words "the ward"").
Page 56, line 6, leave out from ("court") to ("and") in line 8.
The noble and learned Lord said: I spoke to these amendments with Amendments Nos. 47 and 48. I beg to move.
On Question, amendments agreed to.
Schedule 6, as amended, agreed to.
Schedule 7 [Repeals and revocations]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 82:
Page 58, line 33, at end and insert—

("24 & 25 Geo.5. c. 41.

Law Reform (Miscellaneous Provisions) Act 1934.

In section 1(1), the Words "or seduction".

1 Edw. 8 & 1 Geo. 6. c. 9(N.I.).

Law Reform (Miscellaneous Provisions) Act (Northern Ireland) 1937.

In section 14(1), the words "or seduction".").

The noble and learned Lord said: I spoke to Amendment No. 82 with Amendments Nos. 8, 9 and 10. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 82A:
Page 59, line 11 at end insert—

("1969 c. 46.

Family Law Reform Act 1969.

Section 16.")

The noble and learned Lord said: Amendment No. 82A is a minor technical amendment consequential on Clause 19. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 83:
Page 59, line 23, column 3, at end insert—
("In Schedule 1, in paragragh 2(2) the entry relating to the Deposit of Poisonous Waste Act 1972.")
The noble and learned Lord said: This amendment repeals an obsolete statutory provision. I beg to move.
On Question, amendment agreed to.
Schedule 7, as amended, agreed to.
House resumed: Bill reported with the amendments.

Reserve Forces Bill [H.L.]
Returned from the Commons agreed to.