Lords Sitting of 28 February 1983

Preamble
The House met at half-past two of the clock: The DEPUTY CHAIRMAN OF COMMITTEES (THE EARL OF LISTOWEL) on the Woolsack.
Prayers—Read by the Lord Bishop of Derby.

GLC's Increased Rate Precept
Lord Boyd-Carpenter: 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 propose to take to prevent massive rate increases in London this year resulting from precepts by the Greater London Council.
The Minister of State, Department of the Environment (Lord Bellwin): My Lords, the GLC have now set their 1983–84 budget at £877 million, compared with the £566 million guidance figure issued by my right honourable friend the Secretary of State for the Environment. The council have announced an increase in their precept of about 14 per cent. Had they followed my right honourable friend's advice, they would have been able to reduce their precept by a significant amount.
Lord Boyd-Carpenter: My Lords, I thank my noble friend for that disturbing and unhappy information. May I ask my noble friend whether he is aware that the action of those controlling the Greater London Council today will not only impose very severe hardship on a great many of the citizens of London but will also to a considerable measure frustrate the policies of Her Majesty's Government on incomes and prices? In those circumstances, are the Government prepared to do something about it?
Lord Bellwin: My Lords, I am very aware of and I concur with what my noble friend has said. As to what Government do about it, he will know better than most people in your Lordships' House that that is something that one does not quickly or lightly decide upon. Today the most that I would want to say is that this causes the affairs of the authority to be under greater review than ever.
Baroness Trumpington: My Lords, at the risk of ruining my own Question, may I ask this further question: Is my noble friend aware that Labour councils in London have decided to spend £250,000 from public funds in an advertising campaign attacking the Government's rating policies?
Lord Bellwin: Yes, my Lords, I am so aware.

Polytechnics and Further Education Pool
2.39 p.m.
The Lord Bishop of Liverpool: 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 remedy the unfair effect of the "capping" of the advanced education pool in 1982–83 on some local education authorities which provide polytechnics.
The Earl of Swinton: My Lords, the Government do not accept that the method for distributing the advanced further education pool for 1982–83 was unfair to local education authorities which provide polytechnics. But the Government are concerned to secure progressive refinements in the funding arrangements for polytechnics and other colleges: some of these have been introduced for 1983–84.
The Lord Bishop of Liverpool: My Lords, in thanking the noble Earl the Minister for his Answer, may I ask him whether he recognises that Liverpool Polytechnic in particular has been affected very adversely by this change of policy? Liverpool Polytechnic, with very little or no fat, has never been a free-spending authority. Does he acknowledge how illogical it seems of Her Majesty's Government to talk of pouring money into Merseyside and to appoint a Minister for Merseyside whose first concern is to regenerate employment and to strengthen good training, while at the same time reducing the rate support grant to Liverpool by £64 million over four years and imposing a new financial system for polytechnics which costs the City of Liverpool an additional £3 million a year for the provision of the polytechnic?
The Earl of Swinton: My Lords, I always feel rather embarrassed when I have to answer questions about surplus fat, but I shall do my best! May I answer the right reverend Prelate first of all about unfair treatment of the Liverpool Polytechnic? I do not think that this statement is fair at all, because the Liverpool Polytechnic's reduction was only 2.1 per cent., which is just above the minimum provided for, whereas polytechnic cuts throughout the country average 5 per cent., and in other maintained establishments the figure is 9 per cent. I appreciate and absolutely agree with him that Liverpool Polytechnic had been a fairly sensible institution and had not been overspending. That was why the cuts were down so much. Regarding his other question about the special responsibility of the Minister for Merseyside, may I say that the special responsibility which my right honourable friend the Secretary of State for the Environment has had for Merseyside does not relieve the local education authority from complying with national policies for higher education which entail substantial reductions in expenditure.
The role of the polytechnic in Liverpool, as of other major establishments in their regions, will, however, certainly be one of the factors to be taken into account in the decisions on the National Advisory Body's planning exercise for 1984–85. In practice, the

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problem of inner city regeneration needs capital rather than current expenditure. If the right reverend Prelate checks, he will find that Liverpool Polytechnic have done rather well out of this. My right honourable friend the Secretary of State for Education and Science will be ready to consider even more additional specific support in capital provision when the shape of the newly enlarged polytechnic is settled.

Gibraltar: Defence Land
2.42 p.m.
Lord Merrivale: 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 is the present position regarding the gifting to the Gibraltar Government of surplus defence land in Gibraltar (apart from the North Mole and Viaduct Bridge and, too, the dockyard land, buildings and assets, should commercial operation prove to be viable); and what talks are taking place between both parties concerning the transfer of other defence land in Gibraltar.
The Minister of State, Foreign and Commonwealth Office (Lord Belstead): My Lords, with the exception of reclaimed land, surplus defence land in Gibraltar is already transferred to the Gibraltar Government free of charge. Her Majesty's Government have recently put forward proposals for revising the arrangements covering the transfer of reclaimed land and discussions at official level are likely to take place soon.
Lord Merrivale: My Lords, while thanking my noble friend for that Answer, may I ask whether the reclaimed land includes structures on the seabed and buildings with a continuing use?—because in the past they were not gifted to the Gibraltar Government. Furthermore, may I ask him whether he will bear in mind what he said in December, regarding an ODA funded consultancy which was to advise how home ownership can be encouraged in Gibraltar? Can he say whether further defence land will be made available for the Gibraltarian private sector?
Lord Belstead: My Lords, my noble friend asks whether structures on the seabed and buildings with a continuing use come within the definition of reclaimed land. The answer to that is, Yes; although perhaps I might point out to my noble friend that of course the North Mole, which the Government have said will be gifted to the Gibraltar Government, is technically a structure on the seabed. Nonetheless, I am very glad, on behalf of Her Majesty's Government, that this undertaking has been given for that particular structure.
My noble friend asked me about further land for more houses. I must simply make the point to him that the Ministry of Defence really must retain what is needed for the operation and support of British forces in Gibraltar. But within that policy the scope of its land holdings is always kept under consideration.
Lord Merrivale: My Lords, without wishing to weary the House, would my noble friend not consider that there is very little flat land available in Gibraltar? Also, would he not think that for there to be only 4 per cent. of properties in Gibraltar which are owner-occupied is a very small proportion of the whole?
Lord Belstead: My Lords, I would agree with my noble friend in that assertion, and perhaps I ought to add to what I have already said, that any specific requests from the Gibraltar Government in regard to land are always looked at very carefully but within the framework of the policy I have just explained.
Lord Cledwyn of Penrhos: My Lords, in answer to a question asked some weeks ago the noble Lord said that the Government would be prepared to assist those who might suffer as a result of the planned closure of the dockyard in Gibraltar. Can he indicate whether any applications have been made for such assistance and what plans the Government have in mind? Furthermore, is the noble Lord aware that these measures could be misinterpreted in certain quarters, especially in the light of recent events? Can he say what attitude the Government are going to take when they hold their talks with the Spanish Government on the question of the sovereignty of Gibraltar?
Lord Belstead: My Lords, so far as the prospects for work in a commercialised dockyard are concerned, the discussions are taking place at the moment between the prospective managers, A and P Appledore International Limited, Her Majesty's Government and the Government of Gibraltar. These are concerned with the practical aspects of the proposed commercialisation arrangements, and other parties who are directly concerned will be consulted at the appropriate time. There will, of course, be normal consultations with the trade unions by the Ministry of Defence and, I have no doubt, later on by the operators. However, I really feel that we are going a little wide in talking about the subject of sovereignty. If the noble Lord will forgive me, I think I will not embark upon that.
Lord Kennet: My Lords, will the noble Lord tell the House what is the difference between "giving" and "gifting"? If there is no difference, can he say why the Government do not use the ordinary word?
Lord Belstead: My Lords, "gifted" was the word which I think has been used in correspondence by the Government. If the noble Lord prefers "giving", I can use that word instead.
Lord Leatherland: My Lords, can the Minister give us an assurance that nothing will be done to diminish the effectiveness of Gibraltar as part of our defences?
Lord Belstead: My Lords, once again I think the noble Lord is going very wide of the original Question. This is a Question about the transfer of lands from Her Majesty's Government—from the Ministry of Defence—to the Government of Gibraltar, and if we go much wider than that we shall go on for ever.
Lord Leatherland: My Lords, if we do transfer these lands, will that diminish the effectiveness of Gibraltar?
Lord Belstead: My Lords, indeed not. I am glad to have the opportunity to reiterate what I have already said in this exchange: that the Ministry of Defence must retain what is necessary for the operation and support of the forces in Gibraltar.

Local Authority Campaign Expenditure
2.48 p.m.
Baroness Trumpington: 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 is the total sum being spent by local authorities as part of campaigns attacking some aspects of Government policy.
Lord Bellwin: My Lords, I regret to say that this information is not available.
Baroness Trumpington: My Lords, I thank my noble friend. May I ask him whether the Government can refute the infamous fabrications which are printed week after week in The Londoner and stuffed through people's letterboxes without so much as a "by your leave", thus giving totally false information to thousands of Londoners?
Lord Bellwin: My Lords, I am aware of the concern with regard to this publication, and indeed I answered questions on the point in this House not so long ago. Really, at the end of the day it is a matter for the district auditor to decide whether or not this is a proper application of public funds, ratepayers' money, and so on. I think it would be helpful if I were to tell my noble friend that suggestions have been made to the district auditor that this is not so; but the final adjudication as to that must lie with him.
Lord Avebury: My Lords, can the Minister say how much local authorities are allowed to spend without explicit statutory authority? Can he also say whether there are any restrictions on the purposes for which that money can be spent? Also, if we believe in the greater freedom of local government from central control, is it not bound to happen that from time to time local authorities will do things which are unpopular with the Government of the day? Therefore, if the noble Lord's party believes in the extension of power to local government, will they not have to accept that the GLC and other authorities may publish material with which they do not particularly agree?
Lord Bellwin: My Lords, it really has nothing at all to do with whether what is in these publications is to support or to go against the Government's policies. It is all related to whether or not this kind of money—ratepayers' money, in particular—should be applied to this kind of thing. That is really what it is about. It has nothing at all to do with Government or Government policies. As I said before, whether it is or is not a proper use of ratepayers' money is for the district auditor to decide, and I assure the noble Lord, Lord Avebury, that there has been no shortage of
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representations to him about this particular publication. As to the first part of the question regarding the availability of powers to authorities to do it, they have powers in two ways—under Section 142 of the Local Government Act and also under Section 137, if they wish. But, primarily, Section 142 applies to this particular type of expenditure. How much money that means, as I am sure the noble Lord knows, varies in accordance with the totality of their spending.
Lord Underhill: My Lords, would the Minister agree that, when consultation papers are issued, it is quite a democratic procedure for a local authority to wish to consult people in its area and, if it believes that any threatened legislation will be injurious to the people in the area, to endeavour to do something about it—maybe, by campaign activities?
Lord Bellwin: My Lords, I consider it a matter of priorities and I would question very much whether it is a great priority for an authority which says, as most authorities do, that it would like to apply more money to the application of services but it is always short of funds to do this. If it is a priority of such an authority to spend money on running campaigns against Government policies, then I think it will really have to answer to the people it represents for what it does not provide.
Lord Boyd-Carpenter: My Lords, is it not, on the other hand, unfair to the Greater London Council to criticise them for adorning the facade of County Hall with the London unemployment figures, in view of the fact that their own high rate policies have contributed so much to those figures and they are, therefore, only proclaiming their own achievements?
Lord Bellwin: My Lords, my noble friend knows that I have much sympathy with what he has just said, but I suggest that that is slightly aside from the original Question.
Lord Bruce of Donington: My Lords, arising out of the noble Lord's original reply, would he say whether there have been any incidents reported to him of reports by the auditors, to whom he referred, disallowing significant items of expenditure of any local authority? Will he not agree that, although there are certain responsibilities laid on local authorities, there is a responsibility on Her Majesty's Ministers not to make partisan attacks on party lines against specific local authorities?
Lord Bellwin: My Lords, as to the second part of the noble Lord's question, he must take a view on what is said and, like it or not, that will be for him to decide. As to whether or not the district auditor should disallow, to the best of my knowledge his duty is to decide whether the spending of money on publications of this kind, or anything else come to that, is a matter that is ultra vires. That is for him to decide. If he should so decide, he would then know what action to take. But as I have said, I do not know that such action has been taken or is contemplated at the present time.
Lord Brockway: My Lords, would the Minister agree that it is a healthy expansion of democracy in

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this country if local authorities have the right to protest against the policy of the centralised Government? Is it not the case that this is particularly true because the Government are cutting down the expenditure of local authorities on their activities?
Lord Bellwin: My Lords, the noble Lord may feel that it is right to do as he says. But I would only respectfully submit that, in the doing of it, there is a duty to take account of what you spend of other people's money to make your case, and to consider whether it is reasonable to spend £¼ million or £½ million. I am horrified to think that money is spent on publications of this kind. When I remember how carefully we counted every penny of other people's money that we spent in my former incarnation, I am even more horrified that this kind of spending takes place.

Business
Lord Denham: My Lords, it may be for the convenience of your Lordships to know that dinner will be available at the usual time this evening. The Committee stage of the Transport Bill will be adjourned at approximately 7 p.m. for a short period, and during the adjournment the Parliamentary Constituencies (Wales) Order 1983 will be taken.
Civil Aviation (Eurocontrol) Bill
Brought from the Commons; read a first time, and to be printed.
Currency Bill
Brought from the Commons; read a first time, and to be printed.

Transport Bill
2.56 p.m.
Lord Bellwin: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Bellwin.)
On Question, Motion agreed to.
House in Committee accordingly.
[THE EARL OF LISTOWEL in the Chair.]
Clause 1 [Interpretation of Part I]:
Lord Tanlaw Lord Tanlaw moved Amendment No. 1:
Page 2, line 6, at end insert—
(" "facilities" includes those parts of a highway which are reserved for the use of bicycles;")
The noble Lord said: The noble Lord the Minister will realise that this amendment has certain identities with the amendment of a similar kind that I moved to the previous Transport Bill. During the passage of that
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last Bill, I was told when I moved the amendment that it was really none of the business of central Government to direct the financial spending of local government towards the building of cycle ways. At that time, I suggested that local government should get some form of stimulus or encouragement, in order to make provision for cycles and for disabled people, with certain routes inside towns or parts of highways being designated. In all respects this present Transport Bill is a local government finance Bill, so that, having previously been unsuccessful in putting this amendment forward and asking central Government, I am now asking the noble Lord the Minister whether provision can be made in this Bill for the benefit of cyclists.
I think that this is a much more correct stance to take, for the reasons that I am about to give. Cycle ways can be made across parks, they can be made by upgrading footpaths, they can be part of a highway or they can be whole streets designated for the use of cyclists and people in powered disabled cars only. The only trouble is that there is no such heading in local government finance as "Cycle ways". Each of the different parts of a highway or a footpath will come under some other budget inside local government. Therefore, I am taking the opportunity of using the word "facilities" here, to include specifically the use of cycle ways. It would allow any ratepayer of any town who feels that there is a real and pressing need for a cycle way to go to his local authority and say, "Here, you have a budget. You have an allocation for it. Why haven't you done something about it, or how have you spent the money?" Perhaps this is not the right part of the Bill, and I am not a parliamentary draftsman. But I should like very much to know the Government's view on this.
We should not forget what I said when moving an amendment to a previous Transport Bill: that every motorist who takes his cycle to work instead of his car is benefiting not only himself but the whole community by relieving motor car congestion, which is a problem in all conurbations in this country and throughout the world. A great deal of enthusiasm is shown by individual Ministers, members of county councils and members of local government, but this enthusiasm needs to be collected and directed towards helping the cyclist to make his or her contribution to the community in which he or she lives and, by so doing, to make the community a better place in which to live. Without any more ado, I beg to move.
Baroness Trumpington: Two other noble Baronesses who are present today come from Cambridge and both know what a bicycle city that place is. So far as my memory serves me, the city council has created bicycle paths, where it has been possible to do so without the need for extra legislation, simply because that need was obvious. I believe that it would be very hazardous to write this amendment into the Bill. Bicycles can be as much a menace to the pedestrian as a help to the cyclist. I am not sure that I am correct in saying that I heard the noble Lord, Lord Tanlaw, say that he put disabled people into the same category as cyclists. I query whether disabled people, particularly in crowded bicycle cities like Cambridge, would stand a fair chance of getting by without injury.
Lord Tanlaw: I was referring to disabled people driving powered cars. In this context they would be quite safe from bicyclists.
Baroness Trumpington: In that case the cyclist would be in danger from disabled people. I believe that it would be better to leave local authorities to use their own judgment instead of forcing legislation upon them.
Lord Underhill: I support the amendment. There are a number of references in the Bill to transport services and facilities. The noble Lord, Lord Tanlaw, wants to ensure that "facilities" includes measures taken in connection with cyclists. A number of cities and towns are endeavouring to make arrangements to separate cyclists from other road users. The noble Baroness said that cyclists can be a danger to pedestrians, but the facilities which could be provided would endeavour to provide the very safety about which she speaks.
Lord Lucas of Chilworth: I am sorry to have to tell the noble Lord, Lord Tanlaw, that I must again repeat what he was told on the last occasion when he raised this point. He was then told that it is not for central Government to interfere with the rights of local authorities, and I have to tell him again that this Bill makes no provision for local authorities so to do. The highway authority is responsible and must remain responsible for the provision of facilities for cyclists. It is for the highway authority to decide how to organise that provision in the best interests of cyclists and other road users. As my noble friend Lady Trumpington has said, Cambridge has done so to a greater or lesser degree.
To the noble Lord, Lord Underhill, may I say that the Bill has to do with transport services and facilities. It is not appropriate for us to burden passenger transport executives with the job which is left to local authorities to take care of, for which they have been granted powers. The amendment would do nothing to aid the provisions which the noble Lord, Lord Tanlaw, is seeking. In fact, it is more likely to disrupt the existing organisation. Within the counties it would conflict with arrangements for support from central Government through research funds and the transport supplementary grant. The net effect would be far less satisfactory consideration for and support of the needs of cyclists. With that explanation, I invite the noble Lord to withdraw the amendment.
Baroness Masham of Ilton: Before the noble Lord decides what to do, may I say that I support the amendment. I have spent much time in Germany and I have also been on holiday in Holland where such paths for bicyclists are provided as the noble Lord suggests. And what a benefit they are to everybody! As there is now a great movement towards freeing the air of lead and saving energy, I should have thought that this was the time to encourage the use of bicycles.
Lord Boyd-Carpenter: I am sure that my noble friend Lord Lucas of Chilworth is right on the technicalities and that the amendment moved by the noble Lord, Lord Tanlaw, will not stand up, but I must confess that I was a trifle disappointed that my noble
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friend did not say a word by way of encouragement of the provision of cycle tracks under the existing powers which he argued are adequate.
I agree very much with the noble Baroness who has just spoken. Bicycling ought to be encouraged under reasonably safe conditions. It so happens that on my way to work every morning I go across Hyde Park Corner. I am full of both admiration and horror at seeing the number of pedal cyclists, mainly girls, riding through that maelstrom of fast moving and heavy traffic with a courage and a confidence which are admirable but which, for their sakes, I find distinctly alarming. If it could be said by the Minister from that Bench that, using what he himself says are adequate existing powers, more provision by way of cycle tracks could be made, I am sure that it would give encouragement to local authorities and that this would be good. Apart from the danger involved in getting mixed up with heavy traffic, bicycling is an economical and a healthy method of getting to and from work. It is entitled to a word of encouragement from this Committee and, I hope, from the Government.
Lord Lucas of Chilworth: During the passage of the Bill I am very anxious not to spend irrelevant time on matters outside its scope. The Bill is concerned with the preparation of three-year plans leading to the provision of bus and train services. Cyclists are essentially outside the scope of the Bill. If, however, the Committee would like me to enlarge upon the provisions, which my noble friend Lord Boyd-Carpenter has asked me to do, I can do so. The Government have clear policies with regard to cyclists. They were contained in the cycling policy statement which was published after consultation in January of this year. They encourage the provision of improved facilities for cyclists. The overriding aim is to improve the safety of cyclists by providing facilities which will act as alternatives to the use of heavily trafficked and potentially dangerous roads. We provide financial support for the innovative elements of local cycling schemes and we undertake research and provide advice on the provision of these facilities.
The county councils, as highway authorities, were also invited last year to include in their annual transport policies and programmes projects for cyclists. As a result, more county councils brought forward proposals, and these were given favourable consideration in the allocation of the transport supplementary grant for the year 1983–84. That demonstrates exactly what the Government are doing and the area in which it is being done. I just have to repeat that this is the wrong place for such an amendment, but if it helps the noble Lord, I shall be quite happy to describe what is being done.
Lord Tanlaw: I fully accept what the noble Lord, Lord Lucas of Chilworth, has said, but this is the second time that I have produced this amendment and the second time that I have been told that it is attempting to amend the wrong Bill. I am not entirely clear about it. The enthusiasm with which the Government go about this is all on paper. The noble Lord, Lord Boyd-Carpenter, really presented my amendment better than I did. The excuse is given that there is no money for cycleways and that there are

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other priorities. In putting forward this amendment to the Bill—which is, after all, a Transport Bill—my intention is that the cyclist shall not be forgotten. At some time, I should like guidance on the Bill in which the cyclist can get this protection and in which we can get a special allocation so that the cyclists cannot complain.
As the noble Baroness, Lady Masham, has said, it is the fear of taking out either powered wheelchairs or cars for the disabled and the fear of the cyclist that he will be knocked off that has led to the amendment in the first place. The first reason is that it is necessary to get disabled people from A to B safely; the other is to make cycling a healthy and active sport and not a quick way to death. That is the motivation behind these amendments. But in view of what has been said by the noble Lord, Lord Lucas of Chilworth, and while awaiting one day his guidance on when I may produce this amendment, I meanwhile beg leave to withdraw it.
Amendment, by leave, withdrawn.
[Amendment No. 2 not moved.]
3.10 p.m.
Lord Underhill Lord Underhill moved Amendment No. 3:
Page 2, line 9, leave out ("including") and insert ("excluding").
The noble Lord said: The definition of revenue grants in Clause 1 makes clear that these include grants made in respect of reduced fares for children. This means that any such fares reduction will affect the total of revenue grants and will therefore be taken into consideration when the Secretary of State determines the protected expenditure level. The purpose of Amendment No. 3 is to provide that such grants shall be excluded from the meaning of revenue grants in the same way that it is accepted that payments for concessionary fares to the elderly and disabled are also excluded. It is for that reason that I did not move Amendment No. 2. For the benefit of the Committee, I should like to speak also to Amendment No. 68, because that amendment will amend Section 138 of the 1968 Act, which would further assist the proposal we have in mind.
There are strong arguments for reduced fares for children. First, there is the question of travelling to school. As your Lordships will know, for distances of three miles or more the local education authority must provide free transport, but under that distance—and it may be just a fraction under three miles—it is sometimes a hardship for families to pay heavy fares so that their children may travel to school. Reduced fares for children will also encourage children to travel for extra educational purposes, such as visits to museums and other special visits. This links up with the previous amendment, because the more we can provide public transport so that young children will not have to cycle to school, the better. I am one who believes in children cycling at an early age under proper conditions, but they should not have to do so simply because they cannot afford public transport. It would also assist children in undertaking sporting and leisure pursuits.
I was amazed by some of the arguments made during the Committee stage in another place. For
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instance, one Member questioned whether a case had been made out for subsidising children at the expense of adults. I hope that no one in this Committee will repeat that argument, because it overlooks the fact that it is from the pockets of adults that fares have to be paid when their children travel. Therefore, that argument was completely irrelevant. Another Member observed that it seemed to be advanced, and I quote,
"that the aim of a transport service is to obtain as many passengers as possible—the more the better".
I should have thought that that was a very laudable aim. We want more people to travel by public transport if we can encourage them to do so, and reduced fares for children will assist in that.
Some of the metropolitan authorities with which this Bill is concerned already have policies for a flat fare throughout their areas. The experience of those authorities is that a flat fare system has lead to a substantial increase in travel by children. That is one thing that this Committee would wish to encourage. Without special fares for children there will be hardships for poorer families and also those with a number of children. With reduced fares, arrangements can be more easily made than they can be without a reduction in fares for families to travel together.
There was a long debate on this point during Committee stage in another place. It would seem that the Secretary of State who replied on that occasion did not fully appreciate what could be the situation. The Minister said that reduced fares for children have always been part of fares structure. The problem is that under this Bill, payments for children's fares are included in the revenue grants and will be included in the proposed protected expenditure level. The payments for children's fares should not be regarded as coming within the normal transport budget but should be regarded as being based upon social considerations: educational, leisure, sporting, and assisting parents to meet the cost of travel for their children.
Time and time again, the Minister said that this decision on children's fares is one for local decision-making. We accept that; but if these payments are to be included in the protected expenditure level, the Secretary of State could give guidance under later provisions of the Bill, and he could advise that children's fares are too low. Under the provisions of this Bill, the authority will then be expected to take that advice into account. Also, if the protected expenditure level is reduced the authority may be faced with service reductions, fares increases, or pressure to lessen the reduction given on children's fares. By exchanging the word "excluding" for "including", this position could be put right. I hope that noble Lords will support not only Amendment No. 3 but also Amendment No. 68, which will actually amend Section 138 of the Transport Act 1968.
Baroness Bacon: It will be remembered that during the Second Reading of this Bill I raised this question of children's fares. As my noble friend Lord Underhill has said, it is not just a question of the fares of children who are travelling to school, although it is partly that, because while some children travelling to school are entitled to free fares others have to pay. As I said on

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Second Reading, there are a great many instances where children use transport. Most local authorities apply a reduced rate for travel for purposes other than going to school. When the noble Lord replied in that debate, he said in regard to children's fares:
"I should have liked tonight to refer to what she said about children's fares, but I cannot because I should never get through all that I have to say, but I shall write to her about it".
I wish to thank the noble Lord, Lord Bellwin, for the letter I have received today, which I have not yet properly digested.
So far as I can see, two separate points are dealt with in this letter. One is the legality of local authorities being able to operate reduced fares for children. For example, in West Yorkshire all children under the age of 16 pay half fare, no matter when they are travelling or for what purpose. In his letter, the noble Lord, Lord Bellwin, states that he wishes to clear up this point because some local authorities thought that such an action was illegal; and he wants to make quite clear that this will be legal under the Bill. But this amendment deals with another aspect: whether or not the amount of money paid in subsidy for children's fares should be excluded from the total amount allowed by the Government. I think it is that point which concerns us most, whether or not we can hive off the amount of subsidy for children's fares in the same way as is hived off the subsidy for old people and for handicapped people. I do hope the noble Lord will agree to this. If not, while it is still legal for local authorities to make half-fares or quarter-fares, or whatever they like, for children, it might not be practicable because they would have to do it within the global amount of subsidy which is laid down by the Government. I hope, therefore, the noble Lord will deal with the second point, and I would thank him for clearing up the first point.
Lord McIntosh of Haringey: May I, too, refer back to Second Reading, when the noble Lord, Lord Bellwin, expressed great indignation at the nature of some of the protests made by the metropolitan authorities and by those who lobbied Members of this House about the threat, as they say saw it, to concessionary fares for old people and the disabled. Whether or not he was justified in that indignation, the fact is that children and those in full-time education are not treated in this Bill in the same way as the elderly and the disabled. I want to ask the noble Lord: why should this be so only for the metropolitan counties? May I remind him that the Public Service Vehicles (Travel Concessions) Act 1955, which is still in force, does include children and those in full-time education in the same category for travel concessions as those other categories of the elderly and the disabled. Therefore the shire counties, who are not covered by this Bill, do have the same rights to extend travel concessions to children without financial penalty. Yet the financial penalty, in the terms of the protected expenditure level, covering children's fares is proposed to be enacted in this Bill. I would like the noble Lord to tell us why the metropolitan authorities are being treated differently from the shire counties.
Baroness Masham of Ilton: I would like to ask the noble Lord whether he is aware that, now that so many of the small corner shops have gone and the shopping
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centres are concentrated in the big cities and in the centre of the towns, many children are left by their parents in their homes; there have been some horrifically sad cases of fires and children being burned and maimed because they have been left behind by their parents. I would have thought it was wise to encourage the mother or the father to take the children shopping with them. I hope the noble Lord will look very carefully at this matter. It is not easy to take young children shopping. I do not know whether the noble Lord has ever done it. Children do not particularly like shopping in supermarkets. There is a need to encourage this.
Lord Sefton of Garston: Some time ago this House debated the question of transportation for school children, and I was very impressed by some of the impassioned speeches made by noble Lords opposite with regard to that. The principle being debated was, in the main, that Governments and local government had laid down certain principles in regard to the education of children, and any attempt to take away free transport to schools would have gone against that principle. I think the decision of the House was absolutely right in regard to that. In regard to this present matter the same principle obtains. There are many large cities which have introduced, with the support of Government, the comprehensive system of education, and for that system to function properly it is absolutly essential that we should draw pupils from all sections of society in that city. We should not have neighbourhood schools if comprehensive education is to function. The children must be free to travel to the comprehensive school and therefore must be encouraged to move over long distances.
Baroness Fisher of Rednal: May I follow up something the noble Baroness, Lady Masham, said, something which was brought out quite clearly to me when I was in Tyne and Wear quite recently. I think the Government accept that the family is a rather important part of the social fabric of the country. I think it is important when parents are travelling that they should be able to take their children with them. As my noble friend Lord Underhill said, many of the local authorities now operate a fiat fare system which is encouraging the family to travel together. The family is a unit. The family goes out and sees the surrounding countryside or the city and all that they have to offer. I am sure this is something that all of us would want to encourage. As the Government are so concerned with the family, anything which keeps the family together ought to be supported, not only by words but by financial means as well. Therefore, I think this is rather an important amendment.
Another thing in which this House is constantly interested is inner cities. There is nothing better for children living in inner cities than to be able to get out to the surrounding areas at very cheap fares, especially during school holiday times. Chlildren in the inner city areas at school holiday times face a much more serious problem in regard to how to spend their leisure time than those in the rural areas. One would have expected what is here suggested would be encouraged. Child delinquency arises from boredom, and deliquency is something which costs money in the long run. Therefore, why do we not spend what one may call

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preventative money in aiding the traffic authorities to make quite sure that more children and more families use public transport?
Lord Lucas of Chilworth: Of course the Government realise the difficulty that many parents have in affording full fares for older children, and of course the Government are concerned with the family. It is for this reason that the level of children's fares is provided for in the children's subsidies within the general subsidy, which is eligible for support under the transport supplementary grant. In London and most metropolitan counties reduced fares for children are part of the overall fares structure, and that is where it has to be. It is not for the Secretary of State to say whether a subsidy is too low or too high. Most members of your Lordships' Committee who have spoken have rather missed the point. The Secretary of State has no direct responsibility for determining fare levels. This is a matter for the transport executive's commercial judgment, and as such it would be reflected in the plan which they will put forward, which is met by the PEL.
Certainly the payment for children's fares will come within the scope of the provisions of this Bill. Referring only to children—because the elderly and the disabled are catered for under separate powers—the specific reference in Clause 1 to reduced fares for children makes it clear that these are included within the revenue grant. It confirms the power to pay grant for them and some metropolitan counties have in fact been doing this, but have had some doubts as to the legality of the payments they have been making. The Bill, as it is written, resolves any doubt there might be. Children's fares rarely cover their costs, even when the bus is nearly full. They can only be a major factor in the subsidy policies of authorities and cannot be excluded from decisions on the overall level of subsidy.
The noble Lord, Lord McIntosh, spoke about the PSV concessions Act. He asked why should the Bill apply only to the metropolitan areas. It, of course, applies to the metropolitan areas and to the GLC, as he is well aware, and not the counties. The real reason for devising the Bill is purely and simply because of the payments that some metropolitan areas have been making—my noble friend Lord Bellwin made this abundantly clear at Second Reading and my noble friend Lady Gardner of Parkes read out a long list of consequences of making too massive a payment. Therefore, it is quite reasonable that any subsidy be included in the total amount for which the metropolitan authority, through its transport executive, will ask the Secretary of State.
The Bill does not put any penalty on authorities in relation to revenue grants, relating to general subsidies, including, as I have just said, reduced fares for children. I am quite sure that both I and my noble friend Lord Bellwin will be repeating that the Bill protects from any legal challenge what any metropolitan authority, through its transport executive, may do up to the limit of the PEL (protected expenditure level). It does not impose any kind of penalty anywhere.
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The noble Lord, Lord Sefton of Garston, suggested that we were taking something away. In fact, we are not taking anything away. What we are doing is drawing into the total equation of transport costs that element of concessionary fares. It is entirely up to the authority, having received its PEL, how it makes the distribution. In giving consideration to the authority's request for subsidy, the Secretary of State takes into account all those factors which the transport executive wishes to make through the authority. Then it is up to it. Nothing is being taken away at all.
The noble Lord, Lord Underhill, spoke about the fallacy of the argument offered in another place, that children do not pay their own fares; they are paid for normally by the parents. That is perfectly so. There is nothing unreasonable about that. The parent is probably one who has, through the normal democratic process, access to the local authority. It is there that that determination can be made. What the Government seek to do is to ensure that nobody is disadvantaged, that there is a proper balance between that which is spent and where it is spent and the rights of the taxpayer and the ratepayer. Nothing is being taken away at all.
Lord Mishcon: The noble Lord the Minister is not being as frank with the Committee as we would expect him to be in that reply. This is not the first time that your Lordships' House has considered the case of children and fares, and it is not the first time that this House has looked somewhat critically at the decision of another place in regard to children and fares. I am inviting, if I may say so, on behalf of my noble friends, all parts of the House to take a careful look at this matter, which is not political at all.
What is the situation in regard to the transport grant? It must be—and the Government have said so—the fixing of an absolute total limit to what the Government are prepared to spend by way of subsidy for transport. Therefore, having fixed the global limit, which is what the Government want to do, the individual applications of local authorities will be looked at underneath that total. The reason for excepting old people and the disabled is that it would be unfair, so the Government say, rightly, to consider the advantages which are given to the disadvantaged in that respect within the total global limit, within the limit beyond which the local authority spends at its own peril.
The submission to the Committee is a simple one, which is this. The children should come within precisely the same category in regard to the relief given to their fares as the disadvantaged. I will spend but one minute, I promise the Committee, upon saying why this should be so. I shall not repeat the other points made by my noble friends and others because I am sure the Committee is seized of them—the family point, the school point, the need to visit various areas, the shopping safety point that has been mentioned. I shall merely say that the poorer the authority (as all your Lordships know), the more likely it is to have more children who have to travel by public transport because their parents do not have private transport in which they can afford to carry them. Therefore, it means that if one includes in one's plan rather more than other authorities do for one's children's subsidy,

945
if I can call it that, the children's fares' subsidy, the total will be larger. One way or another you will suffer as an authority. Something will be cut off one of the other items of estimated expenditure in order to bring it within the Government's division of the global limit or, indeed, that subsidy itself will be reduced in the Government's calculation of what is the limit set for that authority's expenditure.
This is a matter that your Lordships may consider is more than a matter of conscience for this Committee. The Committee members, every one of them, will remember their own half fares as children—in some cases many years ago and in other cases not so many years ago—which was thought of almost as a children's right. If we are to have this new structure do not let us upset the children's right, especially in the poorer authorities.
Lord Lucas of Chilworth: I am surprised that the noble Lord, Lord Mishcon, should accuse me of being less than frank. Indeed, perhaps I would say to the Committee that he is being less than frank. He is drawing into this afternoon's debate an emotion: it is called "children". It has nothing whatsoever to do with children. It has to do with money and how it is spent. There is not a question that this Bill prevents children's fares from being paid. It is not so.
Lord Mishcon: I did not say that.
Lord Lucas of Chilworth: I am repeating. Millions of pounds are spent in transport subsidy and children's fares are met; they are included in the general subsidy which is eligible for support under the transport supplementary grant. It is that aspect, when it is included in the total plan, that goes before the Secretary of State. If the noble Lord says that the half fare is a child's right, that is a description. If the metropolitan authority, in offering its plan, sees that right in perpetuity it has only to add it to its plan. It will be part of the plan. It is not a question of children's fares, but a question of total expenditure in subsidy.
Lord Sefton of Garston: I do not for one moment think that it has anything to do with being frank or not being frank. I do not think that the noble Lord understands what is being said. What we are quite simply saying on this side is that because of certain events in the past, which both central and local government agreed, promises were made. The basis of an education was established on the basis of movement of children from one neighbourhood to another. All we are saying is that the facility to move should not be a choice made by the local authority between money spent for other subsidies and money spent for children first. It is as simple as that. If the Government persist and defeat the amendment, the Government will lay themselves clear to the charge that on a question of priorities they are not prepared to give first priority to children. This is something to do with children and not just money.
Lord Tordoff: May I reinforce that point? It seems to me that one of the reasons we are in this position, as we said so many times on Second Reading, is a lack of criteria in the Bill that decide how the global sum is reached by the Secretary of State. If the Government
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were to make some concession in that direction and give the criteria on which these grants are to be made on a more detailed scale, there would be more sympathy from this side of the Committee. The truth is that we have had assurances all the way through the progress of this Bill, both in another place and here, that concessionary fares were not to be affected. Quite clearly, the distinction between concessionary fares for children and concessionary fares for old and disabled people is being spelt out in the Bill in the way in which the Government are presenting it to this Committee. I hope, therefore, that the noble Lord, Lord Underhill, will press this amendment.
Baroness Hornsby-Smith: May I intervene before the noble Lord sits down, because I had hoped to challenge the previous speaker but was not quick enough? Would it not be practical to divide the very genuine claims of children with their families, or for schooling, if they come within the limit which allows them free fares? In most areas it is three miles. I speak having 16 great-nephews and nieces. One of them is theatre-potty and another is railway spotting-potty. They go all over the country. Very well, that is their chosen hobby. They should go cheaply to school and reasonably cheaply on a holiday with their parents or on a day out, but if they insist on coming down to London four times a month to see a London production I do not see why the rest of us should equate them, for cheap fares, with the genuine old-age pensioner, the handicapped or the elderly. It is not the same thing at all.
Lord Underhill: One point must be made at the outset to correct the noble Baroness. We are talking about the services provided in the area of a public transport executive. We are not talking about travelling throughout the United Kingdom. We are referring to travelling within the area for which the PTE and the PTAs are responsible.
The Minister referred to this being a commercial judgment and nothing to do with any domination or dictatorship by the Secretary of State. It is not a commercial judgment. It is not emotion. We are talking about social considerations. That is the important thing about the amendment. The amendment has great cross-party support. I hope that it will not be determined on emotion. That is not the issue.
We welcome the fact that the Notes on Clauses explain that the inclusion of the particular words in this clause make absolutely clear to the law that the metropolitan authorities may make subsidies for children, on which there was some doubt previously. Therefore, we are quite happy that that is there. But we are arguing about a point which I believe noble Lords have made quite emphatically. Is this a matter which should be set against the guidance that will be given for the protected expenditure level? We say that it is being based on a social consideration, and that is something that we shall be saying throughout this Bill. There are certain things which involve social considerations, and we should vote on that basis. I hope that, when we divide, as I hope we shall now, the Committee will support the amendment.
Lord Lucas of Chilworth: Before the Committee makes up its mind, I should like to assure the Committee that the payments for school bussing are not included in the PEL. They are dealt with by the education authorities. School bussing is the point raised by the noble Lord, Lord Sefton. It is the plan that is to be put before the Secretary of State, the plan prepared as between the transport executive and the authority, that will show, if it be the case, that children have been accounted for. That will be grant-aided within the terms of the PEL. So there is no question at this time of imposing, by virtue of this Bill, a disadvantage on children, whether they are going to school or to play.
Lord Mishcon: Will the Minister forgive me and answer one short point? Is it the intention of the Government that every application for a grant made under the plan will be met in full? If his answer is that there is no such undertaking that they will all be met in full, how can he say that the children's subsidy is bound to be met in full—100 per cent.—and that therefore there is no question of that grant suffering?
Lord Lucas of Chilworth: Of course I cannot give an assurance that a claim under the PEL will be met in full. The whole point is that the PEL is to be given consideration both by the Secretary of State and the authorities concerned.
3.48 p.m.
On Question, Whether the said amendment (No. 3) shall be agreed to?
Their Lordships divided: Contents, 74; Not-Contents, 85.

DIVISION NO. 1

CONTENTS

Allen of Abbeydale, L.

Hayter, L.

Amherst, E.

Hunt, L.

Amulree, L.

Ingleby, V.

Annan, L.

Irving of Dartford, L.

Ardwick, L.

John-Mackie, L.

Aylestone, L.

Kennet, L.

Bacon, B.

Kilbracken, L.

Bancroft, L.

Kilmarnock, L.

Banks, L.

Leatherland, L.

Barrington, V.

Listowel, E.

Beaumont of Whitley, L.

Llewelyn-Davies of Hastoe, B.

Boston of Faversham, L.

Lloyd of Hampstead, L.

Broadbridge, L.

McAlpine of Moffat, L.

Brockway, L.

McIntosh of Haringey, L.

Bruce of Donington, L.

Masham of Ilton, B.

Burton of Coventry, B.

Mayhew, L.

Byers, L.

Mishcon, L.

Caradon, L.

Molloy, L.

Cledwyn of Penrhos, L.

Nicol, B.

Collison, L.

O'Brien of Lothbury, L.

Cooper of Stockton Heath, L.

Oram, L.

David, B.[Teller.]

Peart, L.

Davies of Penrhys, L.

Pitt of Hampstead, L.

Denington, B.

Ponsonby of Shulbrede, L.

Diamond, L.

Seear, B.

Elwyn-Jones, L.

Sefton of Garston, L.

Ewart-Biggs, B.

Somers, L.

Fisher of Rednal, B.

Stedman, B.

Gore-Booth, L.

Stewart of Alvechurch, B.

Grey, E.

Stewart of Fulham, L.

Hale, L.

Stone, L.

Hampton, L.

Strabolgi, L.

Hanworth, V.

Tanlaw, L.

948

Taylor of Mansfield, L.

Wedderburn of Charlton, L.

Tordoff, L.[Teller.]

White, B.

Underhill, L.

Wigoder, L.

Wallace of Coslany, L.

Wootton of Abinger, B.

NOT-CONTENTS

Adeane, L.

Hornsby-Smith, B.

Airey of Abingdon, B.

Hylton-Foster, B.

Auckland, L.

Killearn, L.

Avon, E.

Kimberley, E.

Balfour of Inchrye, L.

Kinloss, Ly.

Belhaven and Stenton, L.

Lane-Fox, B.

Bellwin, L.

Lauderdale, E.

Beloff, L.

Long, V.

Belstead, L.

Lucas of Chilworth, L.

Bethell, L.

Lyell, L.

Boyd-Carpenter, L.

Mackay of Clashfern, L.

Campbell of Alloway, L.

Macleod of Borve, B.

Campbell of Croy, L.

Malmesbury, E.

Chelwood, L.

Marley, L.

Clancarty, E.

Marshall of Leeds, L.

Cork and Orrery, E.

Mersey, V.

Cottesloe, L.

Molson, L.

Craigavon, V.

Mottistone, L.

Cullen of Ashbourne, L.

Murton of Lindisfarne, L.

Daventry, V.

Northchurch, B.

Davidson, V.

Nugent of Guildford, L.

De Freyne, L.

Penrhyn, L.

Denham, L. [Teller.]

Portland, D.

Drumalbyn, L.

Rankeillour, L.

Duncan-Sandys, L.

Renwick, L.

Ellenborough, L.

St. Aldwyn, E.

Elliot of Harwood, B.

St. Davids, V.

Elton, L.

Sempill, Ly.

Enniskillen, E.

Skelmersdale, L.

Ferrers, E.

Spens, L.

Fraser of Kilmorack, L.

Stamp, L.

Gainford, L.

Strathspey, L.

Glanusk, L.

Sudeley, L.

Glasgow, E.

Swinton, E. [Teller.]

Glenarthur, L.

Terrington, L.

Glenkinglas, L.

Teviot, L.

Gridley, L.

Thomas of Swynnerton, L.

Hailsham of Saint Marylebone, L.

Tranmire, L.

Trumpington, B.

Hampden, V.

Vaux of Harrowden, L.

Harmar-Nicholls, L.

Vivian, L.

Harvington, L.

Wakefield of Kendal, L.

Henley, L.

Westbury, L.

Resolved in the negative, and amendment disagreed to accordingly.
3.56 p.m.
Lord Underhill Lord Underhill moved Amendment No. 4:
Pale 2, line 11, after ("children)") insert ("and excluding grants made pursuant to section 15(3) of the Transport Act 1968 (particular passenger transport services required to meet the needs of the area).")
The noble Lord said: I beg to move Amendment No. 4. The purpose of this amendment still deals with the question of "revenue grants" as defined in Clause 1. The amendment seeks to exclude grants made under Section 15(3) of the Transport Act 1968. The amendment describes these as payments to meet:
"particular passenger transport services required to meet the needs of the area".
I shall avoid taking the time of the Committee by reading subsection (3), but it is rather important. The purpose of the subsection is that it empowers the elected authority, the transport authority, to instruct the non-elected transport executive to make provision of a particular service if that is considered absolutely essential in the area, for which the authority will undertake to make payment to the executive and to

949
include it in the precept on the district authorities. I have paraphrased the present provisions of Section 15(3) of the Transport Act 1968.
The importance of Section 15(3) was emphasised by Mr. Justice Woolf when he gave judgment against Great Universal Stores in their case last year against the Merseyside County Council. I shall not stress that case because the Minister in the other place took the view that, because the judgment did not go to the appeal court, it was not actual case law. But I will mention the fact that Mr. Justice Woolf based his argument a great deal on the provisions of Section 15(3) of the 1968 Act. That section relates not only to bus services but applies also to the retention of certain rail services under what is known as Section 20 grants.
The Under-Secretary of State in the other place has pointed out that as from 1st April 1984, Section 15(3), to which I have referred and to which reference is made in the amendment, will be repealed. The amendment would provide that payments in accordance with the provisions of Section 15(3) will be excluded from the revenue grants for next year—in the same way, as regards the last amendment, we tried to exclude the payments made on social considerations for children—but will also require a consequential amendment to ensure that the section is not repealed subsequently. The amendment seeks to retain the position of the elected authority with regard to the special passenger services and to retain this important decision based on local needs. The Under-Secretary of State also argued at the Committee stage in another place, at column 398 of 9th December:
"I am happy to tell the Committee that Clause 4(2) does a bigger job than Section 15(3)."
That may be the argument which the Minister will advance today.
But let us look at what Clause 4(2) actually says. It says:
"for the purposes of this section the Authority may require the Executive…"
How is it possible to compare that with the provisions of Section 15(3) of the 1968 Act?—which, as I said, gives power to instruct the executive if the authority wants a particular service to continue; that is, the elected authority instructing the non-elected executive that it wants a particular service. Clause 4(2) cannot possibly be compared with that. The provision in the Bill is toothless and halfhearted, and I am surprised that the Under-Secretary of State should make the statement in the other place that, in effect, it is a better job and a bigger job than Section 15(3) at present.
The provisions of Section 15(3) in the 1968 Act are very important. It means that where there is a service which must be continued, the authority can say to the transport executive, "You shall do this". If the transport executive says, "We cannot do it; we cannot afford it", then the authority can say, "You will do it but we will guarantee the payment for this service". We are insisting that where that is done such payments should not be taken into consideration as revenue grants to be set against PEL. I hope it will be accepted that Section 15(3) is important. I have statements which will justify that which, if necessary, I shall quote. I beg to move.
Lord Lucas of Chilworth: At present an authority can tell its executive to provide a loss-making service
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under Section 15(3) of the 1968 Act. The authority then pays the cost, as indeed the noble Lord, Lord Underhill, told the Committee. But under this Bill such payments are swept up with other payments under Section 13 of that Act into the new arrangements—that is, the annual plan, the guidance and, finally, the authority's decisions on the plan, and its decision on the total of grant for the year.
The Bill leaves the power of Section 15(3) in place until April 1984. Repeal is left until the Bill's processes are fully established, so the repeal occurs when the first full plan and the first determination have been made. Before that date an authority will still be able to ask the executive to run an uneconomic service. The authority will need to use its Section 15(3) powers when it decides the grant and the services it wants to run. After that, any use of the power in 1983–84 will be severely limited by the fact that the authority cannot increase the grant for 1983–84 after once deciding the level.
I suppose that in certain circumstances one might ask for a service between A and B and then say later that the cost should be met by spending less on other services, but I think that that power would be little used once a grant had been determined.
There are two main reasons for discontinuing Section 15 and sweeping it into the revenue grants under the Bill. First, as I have said, Section 15 will be unnecessary after April 1984. Authorities and executives will then be able to provide particular loss-making services and—this is the point that the noble Lord, Lord Underhill, underlined—the executive might itself decide to put the proposed service into the plan, or the authority could ask the executive to give details and costs under Clause 4(2). But in any case the authority can decide on the service when it approves the total plan and when it determines the grant. So, in effect, Section 15(3) will be quite unnecessary after that time.
The second reason for repealing the power and including these payments in the revenue grant system is that if we left the power in being and we separate them from revenue grants, the authority would be able to circumvent the new procedures. It would be able to call for new services and decide to pay for them at any time of the year, and the disciplines of the annual plan leading to the PEL and the single determination of grant would all be lost. These orderly and proper procedures as set out in the Bill would be debased because the authority would attempt to by-pass them and, in fact, would have the ability to by-pass them.
The Government would have to resist this amendment, first, because Section 15(3) payments must be within the revenue grant system. Where the processes of the Bill are fully suitable and allow an authority to decide what services are to be provided, they can do that within the revenue grant system. The second reason is that to leave the power outside revenue grant and unrepealed would totally destroy the desirable processes which are being set up under the Bill. There can be no way in which the basic premise of the Bill—that of setting limits for total expenditure under which protection will be given—cannot be circumvented. This amendment would, in fact, do that.
Lord Underhill: There are two points to which I should like to refer because in his reply the Minister said, first, that Section 15(3) will be repealed after 1st April 1984. That is assuming that the Committee agrees with that clause. We have not reached it yet and there are amendments to deal with it. He also said that after the determination of grants in the first year no other grant can be paid. We have not reached that part of the Bill yet either, and there are amendments to deal with that. Therefore, it is no good quoting to the Committee proposals which may be overturned in this House. That is the purpose of the Committee stage of the Bill. We want to put these things straight.
The noble Lord said that it is impossible to leave to outside revenue grant the possible grants under Section 15(3) of the 1968 Act, and that would destroy the purposes of the Bill. It is because we do not like the purposes of the Bill that we want to change some of these things, and that will be shown as we go along from amendment to amendment. However, on this amendment, I should like to read very carefully what the Minister has said. Possibly we shall come back to this matter on Report, but meanwhile I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Underhill Lord Underhill moved Amendment No. 5:
Page 2, line 15, at end insert—
(" 'benefits', for the purpose of sections 3(4)(c) and 4 (6) (b) below, means the social, economic and environmental transport advantages.").
The noble Lord said: This amendment also deals with a definition in the interpretation clause, Clause 1. It refers to the provisions of two particular clauses of the Bill. Clause 3(4) in the Bill relates to the annual plan which has to be prepared covering the period of the next three years and which has to be accompanied by estimates of three particular items. The item mentioned in paragraph (c) of Clause 3(4) in the Bill is:
"the benefits to potential users of those services and facilities".
It will be noted how very restricted is the reference to benefits; it is only to "potential users of those services".
The other clause referred to is Clause 4(6), which sets out three items to be included in matters on which the Secretary of State may indicate that modifications should be made in the annual plan. Paragraph (b) of that subsection refers to:
"the benefits which would result from the making of such grants".
In no way does that elaborate on what is meant by "benefits". The purpose of this amendment is to establish clearly what the Bill intends, what the Government intend, should be meant by the word "benefits". The amendment seeks to provide that the use of the word "benefits" in each of these subsections means
"the social, economic and environmental transport advantages"
of certain proposals.
There will be no argument about the inclusion of economic benefits. I am certain that the Government will say that that is essential as being one of the benefits. Therefore we describe that one of the benefits must be economic benefit. But, in addition, the amendment takes the view that to consider transport services without taking into consideration the
952
important aspects of social and environmental matters is foolish. The effects upon shopping, upon entertainment, upon sports events and on people's lives are there, and that is why we believe that these descriptions of what is meant by "benefits" should be written into the Bill. I beg to move.
Lord Lucas of Chilworth: The Committee should have firmly in their minds as we go through this stage that this Bill can be considered only in terms of a complete package. Draw out little bits of it and the package is totally destroyed. If that is the intention of noble Lords opposite, then I can understand it. But I have to say now, in reference to Lord Underhill's remarks a short while ago, that they do not like the Bill—I can understand that, because the Bill puts upon local authorities, through the passenger transport executive, a ceiling limit outside of which they have to run the gauntlet of the electorate. Therefore, when we are talking about this particular amendment I ask the Committee to bear in mind that we are talking about one part of a total package. This is not a bit by bit Bill. This is one total package of one Bill.
Lord McIntosh of Haringey: Would the noble Lord allow me to intervene? Where in the Bill occurs this ceiling limit to which the noble Lord has just referred, outside which local authorities shall not go?
Lord Lucas of Chilworth: It is the PEL. I have used that term to describe the PEL, and it is the limit to which they can go without being challenged.
Lord Sefton of Garston: I find this almost unbelievable. The noble Lord is telling the Committee that his mind is closed to any kind of amendment to this Bill. The noble Lord, Lord Bellwin, shakes his head. If the noble Lord's words meant anything, that is what they meant. He said it has to be taken as a total package. Another way of interpreting that is to say, "Take it or leave it". Let me put a simple case with regard to this amendment. I come from Merseyside, as some people know—and in any case my accent would give me away. The situation on Merseyside, as I described on Second Reading, is that we followed certain policies. Being prevented by central Government from expanding our boundaries we had to move people out. In order to recompense them for their being moved further away from the centre of their activities, we operated a cheap fare on long distances.
It may well be that within a short period—I rather hope that it will be within a short period—some economic event may take place to the benefit of Merseyside. In order to get it, it may be that Merseyside would have to take a rapid decision—and they have already taken it four times under the special powers they have—to provide a transport service to a certain area. According to the noble Lord, there is not going to be any question of being able to operate that unless we take it out of what he calls "ceiling limits", the PEL; because if we do not do that and we decide to provide that service for the benefit of Merseyside, the people who are going to decide whether we are right or not are, first, a disgruntled ratepayer and, secondly, the courts.

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It is no use the noble Lord shaking his head, because the Bill says that if we exceed the PEL the local authority can be taken to court and be told that any expenditure above that is illegal. In the case that I am drawing, that is allowing the courts to decide that a certain venture in transportation cannot be done. The noble Lord surely will not say that an Act of Parliament going through now would govern all the circumstances for the next two to three years. There must surely be some flexibility. Then why cannot the Minister consider an amendment which would allow consultations between central Government and the local authorities to exceed the PEL at a specific time other than under the terms of this Bill? Perhaps the Minister would give us his opinion on that and let us see whether he is flexible at all.
Lord Lucas of Chilworth: The Government will of course listen to anything that noble Lords may say during Committee. I was merely suggesting that we have to look at this Bill as a package. The basic principle of this Bill is that transport executives and authorities offer a plan. The Secretary of State discusses this with the authorities. A protected expenditure level is then established. If, indeed, I said to the noble Lord, Lord McIntosh, "limit". I in fact should have said "level". A ceiling level; a protected expenditure level. Obviously, a metropolitan authority can exceed it if they so wish. They would be ill advised so to do.
Returning to the point that the noble Lord, Lord Underhill, raised, I can understand that everybody would want to see the widest possible consideration for all types of benefit which can be derived from public transport service provision. But I do not believe that the wording proposed in the amendment is necessary to achieve that object. The executive, under Clause 3, and the authority, under Clause 4, and the Secretary of State, also under Clause 4, are empowered to consider any benefits which they believe to be derived from particular levels of revenue support. The wording proposed, with its reference to "social, economic and environmental transport advantages" is very wide, and it occurs to me that there might be at least the possibility of argument that some benefit which it is believed will be derived from the plan will not fall within that definition. With the present wording, which allows any benefit to be taken into consideration, the problem would not arise.
The second objection is that Clause 3 refers only to the estimate which the executive is required to provide under Clauses 3(4) of the benefits to potential users of these actual services and facilities which they propose to provide. Since that subsection is concerned with the specific details of the actual services to be provided it is appropriate to limit the estimate of benefits in that context to these accruing to potential users, and that is what the Bill does.
The amendment, as it is drafted, would apply in Clause 3 only to that subsection. But subsection (3) of that clause lays on the executive a wider duty, and that is to provide, along with the plan, general particulars of the benefits expected to accrue from a given level of revenue support. Subsection (5) empowers the Secretary of State to give advice, inter alia, as to how those benefits could be assessed. This is in the general
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guidance. The amendment would not extend to those. But in the context of those provisions, the wider considerations that the amendment has in mind are, if anything, more important than they are in subsection (4).
In giving advice to executives under subsection (5), I would not wish to discourage them from taking account of any benefits which they believe would be associated with their proposed course of action. As for the benefits mentioned in the amendment—social, economic and environmental transport advantages—such a provision would inhibit that consideration. In any event, the Secretary of State could enjoy a range of action as to the benefits which could be taken into account. For those reasons the amendment is unnecessary and the objectives it seeks to achieve are wider than, and already more than covered by, the Bill as drafted.
Lord Tordoff: I wonder whether the Minister really has any understanding of what we are trying to say from this side of the Committee? I take his point that the amendment as drafted may be too narrow or, in some ways, too wide. Perhaps from these Benches we would not wish to go in for the degree in social engineering that the Labour Front Bench might wish to pursue. But until we have some indication from the Government as to the rules which the Secretary of State intends to apply in reaching his conclusions, we are in considerable difficulty.
The Minister says the PTEs can put up almost any scheme they wish, and I take that point. On the other hand, there is no apparent constraint on the Secretary of State not to turn down any scheme he wishes, and it is that absolute power accruing to the Secretary of State which is the cause of considerable concern on this side of the Committee. It is not that we are trying to be totally destructive—we do not think it is a good Bill, but we are trying to be constructive—and I hope the Minister will respond in a constructive way. We know the problems the Government are facing in relation to overspending by local authorities. Nevertheless, we fear that unless something is spelt out in the Bill which gives at least a guideline to the Secretary of State as to those things which he should or should not take into account in reaching his decisions, we shall be leaving him with enormous powers which we feel are dangerous.
Lord Boyd-Carpenter: I hope I am not being offensive when I say that the amendments from the other side of the Committee have been largely wrecking ones. Indeed, the noble Lord, Lord Underhill, went so far as to admit that on the previous one.
Lord Underhill: I did not.
Lord Boyd-Carpenter: That is what the noble Lord said. He said that they hated the Bill and therefore they wanted to knock a hole in it. That is a fairly accurate paraphrase of what he said.
Lord Underhill: A mutilation of what I said.
Lord Boyd-Carpenter: The noble Lord is perfectly entitled to take that view. On the other hand, I think

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the Committee will be disposed to weigh perhaps less seriously arguments put forward from that standpoint than arguments designed to improve the Bill. When we come to the present amendment, it is a little difficult to see, apart from a desire to amend the Bill, what the Opposition are up to. The word "benefits" in the Bill as it stands makes matters perfectly clear, and if you proceed to define them, you are, as a matter of interpretation, restricting their scope. Yet if one listens to the speeches made in support of the amendment, that does not seem to have been appreciated. Indeed, the whole weight of the argument has been of favour of widening the scope.
I ask the Committee to consider—these points are particularly relevant in Committee—whether, if the words in the amendment were put into the Bill, we would not restrict the benefits which may be taken into account. From my point of view, if that were so I might be persuaded to accept them because, as I said on Second Reading, I take the view that the Bill is urgently necessary. I was interested, in that connection, in the words of the noble Lord, Lord Tordoff, when he said he understood why the Bill or something like it had to be brought forward. There has been gross extravagance in transport and other directions by a number of local authorities—most conspicuously the authority just across the river from this Chamber—and any Government of any colour would have had to take some action to check that in the interest both of the ratepayer and of the national economy as a whole.
I have some sympathy with the approach from the Liberal Benches because, in abstract principle, conferring powers on Ministers further to restrict actions of other authorities is not a particularly attractive prospect to me. But when local authorities have behaved in the way that, in the last year or two, some of them have, and in this context, any Government who did not take firm action to repress it would be failing in their duty. Indeed, if this process is to be relaxed and if the older relationship between central and local government is to be re-established, I would use the well-known French quotation:
"Que messieurs les assassins commencent".
Baroness Stedman: The noble Lord, Lord Boyd-Carpenter, is concerned about Ministers taking power away from local authorities. That is what we are getting at in our amendments to this part of the Bill, because power is being taken away from local authorities and given to the Secretary of State. We believe that local authorities should decide what level of transport subsidy they should give to their transport executives.
Lord Boyd-Carpenter: The noble Baroness has raised an interesting question. Is she arguing that the local authority should be allowed to levy any burden it likes, however enormous, on its ratepayers for the sake of transport subsidy without any check or hindrance on it from anybody else?
Baroness Stedman: I am arguing that the local authorities know better than the Secretary of State in Whitehall. They must account to the electors for what
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they are doing and the electors know what their policies are and what is understood by them. This clause is engineering a major shift in power from the local authorities, the elected representatives, to the Secretary of State. At present, the local authorities can instruct their executives, but under the Bill as drafted the executives will make the plans, pass them to the authorities and the Secretary of State will issue both the initial and final guidance on what is to happen. That is a complete reversal of power within the system of transport planning, and that is what we are opposed to in the Bill. The Bill forges closer links between the PTEs, which are the providers of the public services, and the Secretary of State, who is not locally accountable to the electors for the decisions he takes.
Lord Campbell of Alloway: I put aside for a moment any shift of power and come to the question of definition and the fears of the Secretary of State having too great a power. Briefly, if one defines "benefits" along the lines of the amendment, one would not be assisted in being able to challenge a decision of the Secretary of State for arriving at an unfair decision in a matter of public administration. Indeed, going further, I would say that there is the general judicial review machinery which is developing, and which has operated successfully since as long ago as 1977, under the Thameside case. Such machinery is developing the whole time. Under the Bill as it stands, there is machinery by which, if the Secretary of State were to act unfairly or irresponsibly, unmindful of his duties, he could, by way of judicial review, be brought to account for an unreasonable decision. Unless it be thought that by having made those very brief observations I am not in favour of the general spirit of the Bill, I would say that I am; but I was not addressing your Lordships' Committee on that point.
Lord Underhill: Before your Lordships' Committee decides what action to take on the amendment. I should like to put a couple of questions to the Minister; but first I must comment on the observations of the noble Lord, Lord Boyd-Carpenter, as I think he would expect me to do. Of course we dislike the Bill, but I challenge the noble Lord to show that any amendment that I have moved is a wrecking amendment—
Lord Boyd-Carpenter: If the noble Lord challenges me, I would say, Amendment No. 4.
Lord Underhill: The amendments that we have tried to put forward are intended to remove some of the worst features of the Bill. At Second Reading, speaking from the Front Bench on behalf of the Opposition, I said that in the Committee stage we would try to remove the most objectionable features of the Bill, particularly in view of the fact that after Clause 2, Clauses 3, 4, 6, 7, 8, 9 and 10 were not discussed in the other place, except cursorily. Therefore I say that here we shall have to give the utmost attention to the Bill in order to remove its worst features. The amendments are seeking to do that and to ensure that the best features of public transport are adhered to and that the Secretary of State will not be given power to damage them. That is what we have attempted to do.
I turn to the two questions that I want to put to the Minister. From what he has said, do I understand that

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the term "benefits" will be used by the Secretary of State to include, among other matters,
"social, economic and environmental transport advantages"?
It is very important if such a categorical statement is made. Secondly, would the term cover a situation that has been referred to in a letter—I have a copy of it here—sent on 14th December by the Liverpool Stores Committee to all the eight Liverpool Members of Parliament? The letter was also sent to the then Secretary of State, Michael Heseltine, and therefore the department knows all about it and will be in a position to tell me whether the situation to which it refers will be covered by what is termed as "benefits".
The Stores Committee in Liverpool includes all the main stores. I mention only some of them: Boots, British Home Stores, Littlewoods, Marks and Spencer, C and A, Mothercare, Owen Owen, W. H. Smith, and so on. They all express concern, and I shall read just a short extract from the letter:
"The Liverpool Stores Committee is most concerned about the Government's new Transport Bill and the likely effect upon our future prosperity. Anything which will have an adverse effect upon passenger usage of public transport must have a detrimental effect upon the city centre traders".
The letter continues:
"It is a fact that car ownership on Merseyside is virtually the lowest in the United Kingdom, and there is therefore a real need for good, inexpensive and efficient local public transportation",
and so it goes on. In looking into the question of benefits, will the Secretary of State take that kind of situation into consideration? That I think is an important issue. It is not a wrecking question; it is a sensible question, asked in the interests of consumers and the interests of the stores in a city centre such as that of Liverpool. Can the Minister answer those questions?
4.33 p.m.
Lord Lucas of Chilworth: With regard to the important point made by the noble Lord, Lord Underhill, about what the other place did, I would point out that it spent 100½ hours dealing with only Clause 1 and part of Clause 2, and I invite your Lordships' Committee to consider exactly whose fault that was—
Lord Tordoff: Will the noble Lord the Minister nevertheless agree that where a Bill has not been subject to full presentation in the other place, regardless of who was to blame—and I make no comment on that—there is still a responsibility on your Lordships' House to see that the legislation is properly vetted?
Lord Lucas of Chilworth: I am extremely surprised that the noble Lord, Lord Tordoff, should address that question to me, bearing in mind where I sat over the last five years examining almost every Transport Bill line by line. Of course this is exactly what your Lordships' House and its Committees are for. I merely underline the fact that there is much work to be done, and 100½ was spent in the other place—
Lord Mishcon: May I interrupt the noble Lord the Minister merely to utter one sentence and to remind him that when he was indeed dealing line by line with every word of a Bill, at times he became awfully angry with the Government Front Bench?
Lord Lucas of Chilworth: I do not know; perhaps some of my noble friends might have thought that it was anger, but some might have thought that it was just excitement.
The noble Lord, Lord Tordoff, asked quite specifically whether there are no constraints upon the Secretary of State with regard to fixing the protected expenditure level. In response I can say only that in setting that level the Secretary of State must be satisfied that the plan put before him is sufficiently reasonable to attract the subsidy support which is within the authority of central Government. Outside of that the Secretary of State can impose no constraints whatsoever upon the local authority.
The noble Baroness, Lady Stedman, spoke about the clause taking the power away from the local authority. The answer to that suggestion is in fact, no; the clause does not do that. We shall come to the question of who makes the plan, and where that responsibility lies, when we reach a later group of amendments, and perhaps we can then return to the particular point. For the moment we are dealing only with the question of the benefits, and again I confirm to the noble Lord, Lord Underhill, that the Secretary of State can take into consideration any benefit whatsoever that is shown and put forward in the plan. So there is no restriction there—
Lord McIntosh of Haringey: I am sorry to interrupt the noble Lord the Minister, but I wonder whether he will give way again. He said just now that the Secretary of State can take into account any benefit. Would he agree with me that the memorandum that has been issued from the Department of Transport to the metropolitan authorities and the Greater London Council, setting out the benefits which were to be included in the model for determination of the permitted expenditure level, also included those which were not to be included? Would the noble Lord agree with me that the benefits specifically excluded are the social and environmental benefits to which the amendment refers?
Lord Lucas of Chilworth: I am afraid that I cannot help the noble Lord, because I just do not know the answer to that question. My understanding is that the Secretary of State may take into consideration any benefit that the local authority, through the transport executive, puts into its plan. The—
Lord McIntosh of Haringey: I am be able to help the Minister here. Annex A to the note, Proposals for Legislation on Public Transport Subsidies, states that the factors to be included include:
"level of revenue support, benefits from:—
changes in service level, changes in fares … trip generation on public transport, transfer of passengers from private to public transport and reduction in road congestion".
Other factors not taken into account in the model include:
"the effect on the city's economy in terms of employment, location of homes and work places and the environment, the additional economic disadvantages of higher taxes and rates, [and] social needs such as accessibility".
Under those circumstances, how can the Minister say that any factor can be taken into account?
Lord Lucas of Chilworth: I am grateful to the noble Lord for reading that out. It all seems eminently satisfactory to me. How can the Government be expected to stand back when, and I quote one instance which was given during the Second Reading debate—that of South Yorkshire—a 600 per cent. increase in subsidy led to only a 7 per cent. increase in bus passenger miles? A considerable part of that increase in subsidy went on the acquisition of other undertakings. The Government have an overall responsibility, and it is because of these excesses, because the wilder excesses of subsidy have occurred, that the Government have to take this step.
Returning to this amendment, the noble Lord, Lord Boyd-Carpenter, made the point that, if we write in the phrase which the amendment seeks to include, we in fact restrict the opportunities of the transport executives and the local authorities for making inclusions in their plans.
Lord Mishcon: I should like to answer very briefly the helpful contribution that was made by the noble Lord, Lord Campbell of Alloway. He was endeavouring to assist the Committee, as he normally does so well, on legal aspects relating to this matter. He referred to judicial review, and both he and the noble Lord, Lord Boyd-Carpenter, referred specifically to benefits as we have them now in the Bill being a comprehensive term and therefore any definition limiting the interpretation of benefits.
Lord Campbell of Alloway: I agree that there is a difference of opinion between my noble friend Lord Boyd-Carpenter and me. I do not take that view, with respect. I take the view that if you bring into a Bill social, economic and environmental transport advantages, it is of such a vague order as to be useless for the purpose of any enforcement. My noble friend Lord Boyd-Carpenter took the point of view which the noble Lord, Lord Mishcon, mentioned. I take a different point of view about this issue.
Lord Boyd-Carpenter: Is the noble Lord, Lord Mishcon, not now faced with the entertaining situation that, although my noble friend Lord Campbell of Alloway and I make a different interpretation of the words of the amendment, in the result we are both against it?
Lord Mishcon: I frequently find that Members opposite reach a conclusion by a circuitous path. At times it is so circuitous that not even they can agree upon the nature of the path.
Lord Boyd-Carpenter: But we get there.
Lord Mishcon: What I want to say to the Committee, quite quickly, is this: whether it be the question of interpretation on a judicial review, referred to by the noble Lord, Lord Campbell of Alloway, or whether it be the point about limitation, if you define the matter, I frankly say to the Committee—and I have an idea that this may be the lot of many Members, if not all of us—that I had no knowledge of the document that had been issued by the Department of Transport.
I say with great deference that the noble Lord the Minister is doing a very capable job, to which he has
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brought a deal of experience and we are all delighted that he has it. The Minister has had time to consider the point or can ask for further time if he wants to do so. We have now heard of this memorandum. Whereas we had been told before—I am sure perfectly truthfully by the noble Lord because he believed in it at the time—that there were no limits to this word "benefits" and that the department had no intention of cutting out environmental or social benefits if these were to be included in the plan, it now looks—and I am measuring my words very carefully—as though the Ministry has an interpretation which it has put in a document of the word "benefits" which is a very limiting interpretation and which accepts some—if not all—social benefits; some—if not all—environmental benefits; and some—if not all—financial benefits.
In those circumstances, we really ought to know what the intention of the department is. Is the intention of the department to give up this document and alter it now that it has been quoted to the Committee? If not, is it not the Committee's duty to include, if not these words, some words very much like them, because we now know what the intention of the department is in regard to the definition of the word "benefits"?
4.46 p.m.
Lord Plummer of St. Marylebone: I give way to nobody in my admiration when I hear the lawyers start to dissect the legal interpretation of various words in the Bill. It throws a slight shudder down my spine because maybe the noble Lord, Lord McIntosh, takes the somewhat cynical view which I do, although he has been rather closer to this problem than I have when operating the London Transport Authority under the Greater London Council.
From a purely practical point of view. I hope that we will bear in mind the enormous burden which is being thrown at the moment on industry and offices in the conurbations about the country. How long can the, go on bearing the burden which is being thrust upon them? As a cynic I would say that the Government of the day off-loaded these matters on to local government because they became rather tired of paying for them themselves. Now, having off-loaded them on to local government, they find that they have to come back and control the expenditure—and quite right, too.
If one takes the Greater London area, industry—large and small firms—is leaving in droves. We are losing employment as fast as is possible. Unless there is some control of expenditure on these public transport authorities, the situation will get worse and worse. In the end there will be nobody to pay for people to move about the conurbations because the burden on the business ratepayers will be so great that they will simply be in bankruptcy. I hope that the Minister will stand firm in his attitude on this matter. I support him wholeheartedly.
To bring forward the special pleading of the stores grouped in the centre of Liverpool seems a very poor argument indeed. Of course they are in favour of cheap fares. They will go on being in favour so long as one goes on giving it to them, as will all the other groups to which you are going to hand out free fares. What is the limitation on what there they are going to

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hand out? Every day one hears that something is going to be handed out free of charge. The special travellers on London Transport who have certain free concessions are now to be allowed to travel in the peak hour in the evening. One wonders where it is all going. I hope that the Minister will stand firm.
Lord Molloy: May I respond to some of the points that the noble Lord has made? I believe it is vital that a response should be made. First and foremost, all that he outlined was a proposition that was made in the manifesto of the London Labour Party for which the people voted. I do not believe one can come along to this Chamber and say that the people of London ought not to have voted for these things, particularly in the field of transport. When we get to that frontier we are very near what is happening in parts of the world which all of us in this Chamber despise: that where there is a glimmer of democracy there is some reason given to crush it.
Furthermore, when the leaders of the GLC had their plan worked out, they quite rightly went to the top lawyers that they employed and said to them: "Will you please tell us as top lawyers, receiving very high salaries"—as all lawyers apparently do—"whether we would be in order, and would it be legal for us on the interpretation of the current Act of Parliament to do this?" Those lawyers said "Yes", and so they did it. That cannot be a crime in any circumstances. The argument that took place then was whether those lawyers were correct or whether the Law Lords' interpretation was correct—and after all those Law Lords were probably trained in the same school as the other lawyers. The argument was not between the people and their elected representatives but between those who were not elected anywhere—the Law Lords in this building and the lawyers in the GLC. This is what ordinary people readily understand; and so the "Fares Fair" policy was made a reality.
Let us briefly look at the results. The first thing it did was to hearten small businessmen and big businessmen. It meant they lost some of the problems they had been having when people were asking: "What is the good of taking a job when I have to travel, say, from Northolt to the East End of London? It is £16 already out of my salary just to get to work and come back." Therefore "Fares Fair" reduced that and made taking a job worth while: and employers—not wicked trade unionists—have told me that this was an encouraging feature. It would also give them an argument to go to London Transport and say that when people want to move across London and back to do a day's work they can now do it, not with the harsh fares they were charged but on a very reasonable fare basis, which is a very good thing.
Something else happened, and I think this must be stated in regard to this Transport Bill: literally thousands of motorists found it was much cheaper to travel to the outskirts of London and then use the Tube or the bus to get to their place of work. Statistics are available to prove this beyond any peradventure, and the Government have them. So that was another very useful thing. When all these things are put together, what do they really prove? Why should all of Great Britain be involved in running London Transport? Let the people for whom it is primarily
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designed—namely the Londoners—decide how London Transport should be operated. And they made their decision. That democratic decision by the tens of thousands of those who went to the polls was overruled by less than half a dozen judges and it is this sort of thing which really hurts in the breasts of ordinary people. It certainly does in mine.
It was a good scheme and it was part of a remarkable transport exercise to move people around London as cheaply as possible and to take traffic off the roads. So may I say to the noble Lord who has just sat down that I believe any fair-minded person, who will examine what the situation was before the GLC introduced this measure and what happened afterwards when they were compelled to withdraw it—anyone with the faintest idea of what common sense and efficiency mean—would realise that the GLC had introduced a measure which brought in more revenue, took private transport off the road and allowed people to go to their office, factory or place of work. It was a good thing for London Transport; it was a good thing for London industrialists; and it was a good thing for the London people as a whole.
Lord Boyd-Carpenter: We seem to have strayed a little from the relatively narrow terms of a not very important amendment which technically we are discussing. For that, I suppose that all your Lordships, including myself, must accept a measure of responsibility; but I rise now only to say two things. First, I should like to ask your Lordships to pay great attention to the warning given by my noble friend Lord Plummer. As your Lordships know, he has an experience which is equalled only by that of the noble Lord, Lord McIntosh of Haringey—although my noble friend's experience is somewhat longer—of the managing of the largest of all our local authorities. His warning on the effect of the rate policies (for which transport policies have been very largely responsible) of that authority on employment in Greater London and on the prosperity of Greater London is one that I believe your Lordships will not want to disregard. I am quite sure it is one that the people of London outside will not disregard.
The other point I want to take up is the really astonishing observation, if I may say so, which was made In, the noble Baroness, Lady Stedman, in her speech when she allowed me to interrupt her some little time ago. As I understood her (and I hope she will correct me if I am misrepresenting her) she was saying that however high an elected local authority took expenditure—whether it be on transport or anything else within its powers—with the support for the time being of its electors, it must be permitted to continue so to spend and that the central Government must not intervene. Did I misunderstand the noble Baroness?
Baroness Stedman: What I said was that the local authorities were the ones who should decide the levels of expenditure and of the services they needed, because they are accountable to the electors. If the electors do not like what they are doing, within three years they have the chance to get rid of them. But they are accountable to their electors and they are the ones who know what their electors need, what they want and the sort of level of services which should be provided within any locality.
Lord Boyd-Carpenter: Yes: I did not misrepresent or misunderstand the noble Baroness. She said precisely what I was saying a few moments ago but she said it, as is characteristic of her, more clearly. It is that proposition which I should wish to challenge. In that situation you can have a local authority—and I am thinking particularly of the great metropolitan authorities, and we had some figures on Second Reading—carrying the burden of the taxation which they impose and the volume of expenditure in which they indulge to a point that is damaging to the national economy as a whole.
Conduct of the national economy is the responsibility of central Government, of whatever Party or political background it may be composed. If one is in a situation—and I do ask the noble Baroness to consider this, because I think we are in, or very close to, such a situation—in which the conduct of the economy of the nation by the people responsible for that conduct, namely, the central Government, is being damaged (I will not use the word "sabotaged" because that implies motive) and injured by an elected local authority, then, I would submit to your Lordships with great respect, the Government of the day are not only entitled but are indeed bound by their own duties to intervene with whatever legislation may be necessary to curb the excesses of such a local authority. I will give way in a moment to the noble Lord, Lord Tordoff, but it is no good the noble Baroness saying, "Oh, they are responsible to those who elected them". The central Government is responsible to the whole of the electorate and to the whole country; and if the electors in a certain local authority wish to pursue policies which are gravely injurious to the country as a whole, then, in my submission to your Lordships, it is still the duty of the central Government to intervene to stop them. That is the situation which occurs here.
When, as of course is the case—and nobody knows this better than the noble Baroness—your local authority electoral system is highly defective, so that you have a system in which the bulk of the rates in most areas is paid by the people who have no vote at all while the majority of the electors pay no rates, then the argument that they are responsible to their electors becomes rather a pallid reflection of itself. Anyway, I take it, particularly as the noble Baroness has repeated this statement, that this is the view and policy of those she sits among—namely, the Social Democratic Party. If some wider publicity is given to this statement of policy, it might have a very salutary effect indeed on the public's estimation of that worthy collection of people.
Lord McIntosh of Haringey: May I—?
Lord Boyd-Carpenter: I have promised to give way to the noble Lord, Lord Tordoff.
Lord Tordoff: The simple point that I want to make is that, even if one accepts the whole of that argument, which I do not, is a Transport Bill the right way of coming at it, or is a better form of local government finance a better way of coming at it, as my noble friend Lady Stedman would, I am sure, support? The Social Democratic Party and the Liberal Party have been working on this for some considerable time, and she
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herself has been very much involved in producing better forms of local government finance.
Lord Boyd-Carpenter: I can only comment, in reply to the noble Lord, Lord Tordoff, that that is not what the noble Baroness, Lady Stedman, said. She did not say that a local authority should be curbed in these circumstances, but by means of another sort of legislation. She said bluntly that it should not be curbed at all, if it had its electors' suport. On the other point, the damage at the moment is being done most conspicuously through the over-subsidisation of transport undertakings. The matter is of great urgency in this country. Though there is certainly an argument for reforming the whole basis of local government finance, that would take a considerable time and, when there is a leak, as there now is, in the bottom of the boat, it is better to plug it with the instrument adapted to it—in this case, a Transport Bill.
Lord Mishcon: I am taking a point of order, if it is permitted in your Lordships' Committee, which I would normally have taken had I been sitting on the other side. This is a most magnificent Second Reading debate. We are dealing, at the moment, not with whether the Transport Bill is a proper vehicle, or with what the GLC did or did not do. We are dealing with the definition of "benefits", and I believe that our business cannot be conducted in this way. I say that with great deference, sitting where I do.
Lord Lucas of Chilworth: I am obliged to the noble Lord, although I must confess that I have found the last 10 minutes or so extremely interesting. I want to answer specifically the question which the noble Lord, Lord McIntosh, asked, which dealt with the question of benefits. He referred to a document, and I imagine that the document must have been the Proposals for Legislation on Public Transport Subsidies. The paper describes the detailed basis now envisaged and seeks local authorities' comments. So it is not, perhaps, the definitive last paper. If authorities wish to put forward—
Lord Sefton of Garston: Would the noble Lord give way? I have the document here and my understanding has nothing to do with local authorities. The question that I want to ask, now that I have the document is: was this document discussed with passenger transport executives alone, under the Ministry of Transport, or was it discussed with local authorities? If it was discussed with passenger transport executives, what was their attitude, particularly to those factors that are not included?
Lord Lucas of Chilworth: I am sorry, but I do not propose to answer that question now, because the document deals with the planning system to which we shall come later. The noble Lord, Lord McIntosh, raised one small point and asked: does this exclude, or does it include? I am saying to him in answer, because I want to be helpful, that, notwithstanding the document from which he quoted, if authorities put forward other matters, the Secretary of State will be able to take them into account in determining the protected expenditure level upon which depends the amount of subsidy, outside of which local authorities can determine their own course.
Lord Pitt of Hampstead: Is the Minister not being less than ingenuous? If, in effect, local authorities are given guidance as to what are to be regarded as benefits, how can the Minister then say that they can reply in their plan including the things that they were told to exclude, and that they will be considered by the Minister?
Lord Lucas of Chilworth: I can only repeat what I have already said. The words set down in the amendment are restrictive and, we believe, deny exactly what it is that the Opposition are asking for, which is that the Secretary of State can take into consideration benefits. By writing down particular words, it constrains him. I think that the Committee would not wish the Secretary of State to be constrained in considering the matter of benefits.
Baroness Denington: It really is necessary, in my view, and I hope in the view of everybody else, to vote on these words in this amendment. The trouble is that the Government are absolutely blinkered by their concentration on rates. We only ever hear about rates. That is what concerns us on this side so very much. I am not denying that rates, which have now risen to a high level, are a matter of importance. But, from all that is said and written, we gather that the Government think only about rates and we want to be certain, when we are considering transport policies and the monies that are necessary, that the Government take into consideration social, economic and environmental transport advantages.
The noble Lord, Lord Plummer, said that people are moving out in droves because of rates. We do not know about that. They are also moving out because of rents, but the Tory Party never say anything about rents. Rents are nice. They like rents and they do not mind them being high. We do not hear at all from the Tories about the points that my noble friend Lord Molloy made. He was absolutely right, and everyone in this Committee knows that he was absolutely right. We all know—and the noble Lord, Lord Plummer, ought to know from his experience on the GLC—that people move out because they cannot get staff, because of the travelling costs of staff and, because staff cannot get on the buses, they get a job near home—
Lord Lucas of Chilworth: I wonder whether the noble Baroness, Lady Denington, would allow me to interrupt and to take up the words of the noble Lord, Lord Mishcon, a little earlier. In this amendment, we are not dealing with rates, in particular; we are dealing with a definition of "benefits." While I could quite easily answer her—
Baroness Denington: With great respect—
Several noble Lords: Order!
Lord Lucas of Chilworth: I apologise to the noble Baroness, but I ought to come towards the end of what I can offer to the Committee, with regard to benefits. I can only repeat that with the amendment's reference to social, economic and environmental transport advantages, it is wide, but we feel that there is at least the possibility of argument that some benefit which it is believed will be derived from the plan when it is
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offered will not fall within that definition. The present wording allows any benefit to be taken into consideration and the problem would not arise. Therefore, I suggest that the amendment is not necessary.
Lord Sefton of Garston: Before the noble Lord sits down, may I revert to the question of this document? In the Second Reading debate, I said that this Bill was the product not of politicians but of bureaucrats. I said that it had come from the transport world, which was intent only on transport. Now we have a document which the noble Lord did not know about until today. It was issued by the Ministry of Transport and went to the passenger transport executives. Copies were sent to local authorities. It excludes a model which will be used when assessing the protected expenditure level. It excludes the effect on the economy of a city in terms of employment, location of homes, work places and the environment. It excludes flexibility. The noble Lord who sits on the Front Bench opposite said the Government did not know about the existence of that document, which is a disgrace and a terrible condemnation of what is going on. I repeat that this clause hits at the very heart of the Bill. Whether or not they make mistakes is irrelevant. Local authorities want to get the best for their area. Can we leave London out of it for the moment?
A noble Lord: No.
Lord Sefton of Garston: We want to ensure that there is a transport service on Merseyside. We want to try to redevelop an economy which has been wrecked by private enterprise. In doing so, we may, in the opinion of the Government, spend too much, but in the opinion of the people of Merseyside we shall not spend too much. Nor, addressing the noble Lord, Lord Plummer, shall we spend too much in the opinion of all those people who have to pay rates but do not get a vote. The noble Lord may know something about London, but may I tell him that in Liverpool the Liverpool Stores Committee is a very powerful voice in the private sector. The Bill is opposed not only by the Liverpool Stores Committee, which represents all the major ratepayers in Liverpool who have no vote, but also by the regional area of the Co-operative Society, which is the biggest retailer in the area. Therefore, what has been said by the Liverpool Stores Committee cannot be discounted.
May I return to the specific question which I asked. If the Minister is not prepared to answer, then let him say so clearly and unambiguously so that everybody knows. Was this document discussed with the PTEs and the Ministry'? Of course, the Minister does not know the answer to that question but he can write to me. I want to know whether this document was discussed with the PTEs and the Ministry and, if so, what was the attitude of the PTEs to this document. I am reliably informed by local government services that the PTEs throughout the country condemn it and do not agree with a single part of it. Before this issue is finally resolved, we should at least have an answer to that question.
Lord Underhill: The closing remarks of my noble friend Lord Sefton have provided the right note for my reply. It is necessary to find out precisely what the document means and the attitude to it of the PTEs, and also the attitude of the Secretary of State to the replies received from the PTEs. It is also necessary to look carefully at the words which the Minister used. It may be that the use of the word "include" instead of the word "means" in our amendment would have satisfied the Minister. It is obvious that many Members of the Committee feel strongly that the benefits mentioned in the amendment are essential. Whether the Government accept that point of view is not certain. A close investigation of the document may reveal the answer. Rather than divide the Committee at this stage, I should prefer to look at what the Minister has said. I should also like to look more carefully at the document, which I hope the Minister will also look at, and see what was the reaction of the PTEs. Then we can come back to the matter at Report. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 12 agreed to.
Clause 2 [Financial duty of Executives]:
[Amendment No. 6 not moved.]
5.16 p.m.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 7:
Page 2, line 25, leave out ("next following accounting period") and insert ("relevant period within the meaning of section 3(1) below").
The noble Lord said: By arrangement, I beg to move Amendment No. 7. This is a thoroughly uncontentious amendment. It is businesslike and practical. Furthermore, it has nothing to do with socialist ideology, or with the ideology of the Liberal Party or the Social Democratic Party—if, indeed, there is such an animal.
The purpose of the amendment is to give effect to the frequently stated objective of Government, that there should be a businesslike running of public transport in our cities. In order to give effect to that objective, the Bill already says that there shall be a three-year accounting period—the period referred to in Clause 3(1)—and that after the first year indications shall be given by the Government of the expenditure which will be permitted or encouraged by local authorities in the succeeding year. However, the clause with which we are dealing does not continue to give full effect to that three year provision. To paraphrase, it says that any deficit found in one year shall be made good in the next year.
I suggest that this is contrary to the best business practice with which we are familiar. A public transport undertaking is not only concerned with setting fares and service levels year by year. If it is to survive in an increasingly competitive economy, by which I mean competitive in relation to private transport, in future it will have to invest in new rolling stock, new buses and so on; and if it is a fixed track authority, it will have to invest in signalling and in track. Sometimes it will have to undertake experiments: new ventures which will not necessarily come to fruition in the first 12 months or
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even the second 12 months of their lives. Nor should any business be constrained in that way.
The effect of the clause is that despite the indications in the rolling programme, any deficit in one year, as a result perhaps of mismanagement but also as a result perhaps of a sensible and progressive investment policy, will not be allowed in the following year. No doubt the noble Lord the Minister will confirm whether or not I am right in saying that the protected expenditure level will be reduced so that the deficit can be made up in the following year. This means that the only steps which can be taken by a passenger transport authority in the following year must be short-term steps. They must either raise fares or cut service levels and abandon the longer-term plan, which by then will not have proved whether it is successful. It will therefore not take account of the best interests of public transport in that area. This is a short-sighted view which is in conflict with the expressed intentions of the Government and with the well established procedures of the transport policies and programmes and the transport suplementary grant. It reminds me of the statement of Mr. Denis Healey, who said that you cannot get a poultry farm out of the red by starving the chickens. But that is exactly what the clause proposes. It is inconsistent. To borrow the phrase of the noble Lord, Lord Boyd-Carpenter, this amendment is certainly designed to improve the Bill.
Lord Bellwin: The noble Lord, Lord McIntosh of Haringey, will not be too surprised if I tell him that our case does not rely too heavily upon what was said by Denis Healey. It may be helpful if I explain that the purpose of Clause 2(2) is to help make Clause 2(1), the break-even provision, effective and a real commercial discipline. Under Clause 2(1) an executive has to ensure that revenues cover charges so far as practicable in that year. Clause 2(2), as drafted, ensures that this requirement to break even is a real discipline. It does this by requiring an executive that fails to cover charges by revenue, and consequently makes a deficit, to make good that deficit the following year. Clause 2(2) makes the deficit from the preceding year part of the charges which have to be covered by revenues in the following year. This seems to us to be sound financial judgment. The new financial duty, however, does not provide a financial straitjacket. The section requires the executive to break even,
"so far as practicable".
which ensures that an executive which ran a large and truly unavoidable deficit would not, come what may, be forced to make good that deficit in the following year if it was impracticable to do so.
The effect of this amendment would be to allow the executive a three-year period to pay off the deficit. The problem here is that the deficit could accumulate from year to year and it would never be clear whether the financial duty to break even had been complied with. It would surely be a recipe for loose financial management and would not be in the interest of the executives, the authorities, or—perhaps more, or equally, important—the ratepayers and taxpayers who might find their money wasted on excessive subsidies and increasingly inefficient transport services.
It is not unreasonable to expect the executives to exercise taut financial control. However, I believe it

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would be fair to say that if a deficit were to arise from circumstances which really were beyond the ability of the executive and the authority to control, the authority might decide that some increased revenue support was necessary to make good the deficit in the following year, and the Secretary of State will take that into account when considering his guidance on the level of protected expenditure.
My final point is that subsection (2) could allow a deficit to be carried forward for a further year if the executive and/or the authority had done all that was reasonably possible to recover the deficit but nevertheless were unable to do so because the subsection requires them to ensure,
"so far as practicable",
that the deficit is made good. If it were not practicable, clearly they would not be bound to do so. We have here something that is good common sense. It is an attempt to bring this aspect into a much tighter financial régime, which must make sense. At the same time, I think that it is not so inflexible as to leave no room at all. In the past couple of hours we have discussed a number of areas, and I dearly wanted to join in but somehow restrained myself. Here, however, we have something that is on the grounds of management. The Bill is quite flexible—more than some might have thought.
Lord McIntosh of Haringey: The noble Lord the Minister has in his speech gone some way beyond the wording of the Bill. Subsection (2) says that,
"If in the case of any accounting period it is not practicable for an Executive to ensure that those revenues are sufficient to meet those charges",
then it has to be put right in the next accounting period. The noble Lord, Lord Bellwin, has been good enough to say that even that need not be applied too rigidly, if I take him aright, and that there is still room for flexibility in further accounting periods. I shall read very carefully what the noble Lord has said and will consider whether to bring this matter back at Report stage. Meanwhile, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
5.24 p.m.
Lord Underhill Lord Underhill moved Amendment No. 8:
Page 2, line 33, leave out ("by them").
The noble Lord said: We come now to an amendment which is only one in a group, and I believe that it will be to the advantage of the Committee if I speak also to all the related amendments. The amendments total 19 in all; they are Amendments Nos. 8, 9, 11, 12, 13, 14, 15, 20, 23, 24, 25, 28, 43, 45, 46, 48, 49, 50 and 51. I only wish that the decision in favour of all those amendments was as easy as reading them out, but I hope that it will be so after I have explained the purpose of this amendment.
These amendments are of the utmost importance because, in short, they are concened with local democracy. There are various provisions in Clauses 2, 3, 4 and 6 which require that the executive shall alone prepare the plan. It has to be kept in mind that the plan will cover a period of three years, which the executive then submits to the authority. Perhaps I should again remind the Committee that it is not the fault of the
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noble Lords here that another place spent so much time on Clauses 1 and 2. But three of the four clauses with which these amendments are concerned were given very little consideration in another place. I know to my cost the time that was spent on Clauses 1 and 2 because I have read almost every word that was said in the Standing Committee. But it can be argued that Clauses 3, 4 and 6 received little consideration and therefore it is vital that this group of 19 amendments receive the Committee's careful attention.
There are also provisions under which the Secretary of State will have direct contact with the transport executive on various matters, over and above the elected authority. I will remind your Lordships that it is the transport authority which is elected, which has the statutory responsibilities for the provision of services, and which is also accountable to those who elected it. So in all the points which have been raised on other issues, it is the transport authority which has to face the electors and be accountable to them. Generally there are good relationships and understandings between transport executives and the respective transport authorities. Such understandings and relationships are, of course, absolutely essential. The provisions of this Bill will tend to undermine that good relationship. As will be seen from a subsequent amendment, the Bill will enable the Secretary of State to deal direct with the executive when giving his advice and guidance, which is then just communicated to the authority. The Bill will tend to undermine the power of the authority with regard to the executive.
All this is contrary to the position that will continue in the shire counties, for they will be free to continue their subsidy policies, and to carry out and to meet the needs of their areas, without any interference from the Secretary of State. It is only the metropolitan authorities and the GLC which will be affected in the way I have described under this Bill. This Bill will place the transport executive in a confusing situation. It will receive advice direct from the Secretary of State but, at the end of the day, the plan will require the statutory approval of the authority—which is, as I have said, the elected body. The TPP or Transport Policy and Programme which, as noble Lords will know, has to be sent to the Secretary of State each year in connection with the transport supplementary grant, is prepared and submitted by the county council. The county council is in effect the passenger transport authority.
In the light of what has been said by the noble Lord, Lord Boyd-Carpenter, may I emphasise that there is nothing in these amendments that removes the power to be given in the Bill to the Secretary of State to determine the protected expenditure level. That is a matter to which we shall come later, but it has nothing to do with these 19 amendments. I am pleased that the noble Lord nods and assents to that. We are dealing with amendments which will remove the undemocratic features to which I have referred. They will provide for the plan to be prepared jointly by the executive and the authority. We are not even asking in the amendments that the plan shall be prepared only by the authority. We are saying that it should be prepared jointly by the executive and the authority, and this is clearly shown by Amendment No. 48, which will insert the following words:
"Where the joint preparation of a plan has been concluded to the

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satisfaction of the Authority they shall by resolution adopt the plan".
These amendments remove the direct influence of the Secretary of State on the unelected executive, ensure the close relationship of the executive and authority preparing the plan, and will retain the essential position of the elected authority.
We have some mysterious documents. I have another, which is very authentic; I believe the others are as well. We would want the Secretary of State's views on them. I have a letter sent to the Association of Metropolitan Authorities as recently as February 1983 by the Managing Director of Buses of London Transport, Dr. Quarmby, in which he says:
"On behalf of the passenger transport executives and the London Transport Executive it might be helpful to have confirmation that we are with the metropolitan councils in supporting the concept of a jointly submitted plan in place of the separate planning processes envisaged in the Bill.".
I understand that Dr. Quarmby is chairman of the passenger transport executives' group. Therefore, there is not the slightest doubt that the passenger transport executives dislike being put in the position of preparing this plan themselves; they are in effect in support of the 19 amendments which wish the plan to be dealt with jointly by the appointed operators, the transport executives, and the elected authorities, the passenger transport authorities. Therefore I hope no noble Lord will oppose this democratic process which all the operators want, and that they will, by suporting the first amendment, give approval to the whole 19.
Lord Bellwin: The noble Lord said that the planning process provided for in the Bill places the initiative for the preparation of the plan with the executive and thereby fundamentally changes the relationship between the executive and the authority. The noble Lord has suggested—I will not use the word "alleged", which some have suggested to me—that this undermines the existing basis of democratic control. The noble Lord also expressed concern during the Second Reading of the Bill that the plans should be prepared jointly by the executive and the authority. But such a change would in fact alter the whole relationship proposed under the Bill.
I must reassure your Lordships. This Bill does not undermine the existing relationships between executive and authority, or the ultimate responsibility of the authority for the provision of local transport. Under existing legislation the authority has power in relation to the PTE to appoint its members, make grants, obtain information, appoint auditors and give directions on various matters. But the initiative rests with the executive for such matters as preparation of budgets, plans for service reorganisation and for capital expenditure, agreements with BRB and NBC and changes in fare levels, although the executive must secure the approval of the authority for what they propose.
Similarly, under the Bill, the executive will be responsible for the initial preparation of the three year plan and for providing and analysing information on the general level and structure of fares and services. But it will under the Bill, exactly as under existing legislation, also be required to supply the authority
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with any information requested about possible alternative strategies on different service or fare levels. Such additional information might be supplied after the plan has been sent to the authority, or it might take the form of a supplement to the plan. It is surely right and proper that the executive should prepare the initial plan. They are the people, appointed by the authority, with all the knowledge and expertise required for operating transport services.
We agree with the noble Lord, Lord Underhill, that before preparing the plan the executive should consult the authority. To put the matter beyond doubt, we made a suitable amendment to Clause 6(1) in the other place. Once the executive has prepared the plan it must be put to the authority, who will be able to approve it, subject to whatever modification they believe necessary. The authority will be able to add information when sending the plan to the Secretary of State. Your Lordships will see from Clause 4(2) that the authority has considerable scope to require the executive to provide alternative proposals (as indeed they do under the 1968 and 1969 Acts). The ultimate responsibility for the plan that is chosen to go ahead does rest with the authority, and that is the key point.
Given that it is the authority which decides the final form of the plan which is to go ahead and the amount of grant, I fail to see why there should be resistance to the executive's preparing the plan. To place the task of preparing the plan jointly with the authority and executive would surely diminish the use of the experience of the executive in providing services, would risk confusion and delay, but more importantly would risk the authority's declining to explore proposals at levels of grant different from those which they would prefer. The executive are, after all, the experts who know what can or cannot be achieved with given resources, fare levels and services, and it would be folly not to make proper and effective use of their knowledge. The authority will have the final say over the content of the plan and so will be able to discharge their duties in respect of the transport services of their area.
The proposals in the Bill maintain the existing relationships and the accountability of the authority to their electorate. The amendment would instead, I respectfully submit, blur the responsibilities of the executive and the authority. We believe it right for the executive to produce the first version of the plan, concentrating especially on how to get and to give greater efficeiency and—dare I use the words?—value for money. The preparing of this plan will become, for the executive, a part of fulfilling their duty to the authority and to the public at large, who are, if I may say it, fed up with indiscriminate subsidy. The executive will be accountable for their aspects of the plan.
Then the authority will produce its views and modifications to the plan. These will include deliberate political choices and decisions on which services are to be subsidised and to what level. The authority, in making specific alterations and additions to the plan, will be clearly accountable for those, to its ratepayers. The Bill gives clear responsibilities and accountability to both the executive and to the authority. The amendment would obscure and confuse. So for all these reasons the Government could not agree to substitute joint working by the authority and the

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executive in the task of preparing the initial plan, and that is why we are unable to accept this group of amendments.
Lord McIntosh of Haringey: In common with some of my noble friends, I have been involved in the preparation of submissions for a TPP over a number of years. It is quite true to say, as the noble Lord, Lord Bellwin, does, that the initial work on the preparation of a plan for public transport has to rest with the executive; there cannot be any doubt about that. They are the professionals; they have the job of looking at the options and costing them before submission to the authority. But it is not true to say that there is no way under the terms of the amendments moved by my noble friend that that cannot be achieved. There is no reason why with goodwill on both sides there should not be an effective co-operation of those who have the responsibility for preparing and costing transport alternatives and those who have the responsibility of representing the electorate in the area concerned.
The noble Lord the Minister says that the amendments would introduce confusion and delay. I wonder whether he realises that what the amendments do is to cut out confusion and delay, because the Bill as drafted creates an additional area of possible confusion and delay by demanding that the executives should in the course of their work report directly to the Secretary of State. That is the additional confusion, the additional chain of command that we seek to remove by these amendments.
Let it not be thought that this is a theoretical point, because already the Department of Transport, as I am sure the noble Lord is aware, is asking very detailed questions of the passenger transport executives about the way their services operate. For example, London Transport Executive is being asked directly, not through the Greater London Council, about the levels and costs of off-peak services, night time services, weekend services and so on. What we have in the Bill as drafted, before the amendments, is the executive being torn in two directions. On the one hand it is fulfilling a function described by the Minister of preparing a plan for the authority to submit, or on which the authority is to be consulted before submission. On the other hand, it is answering quite separate questions, quite detailed questions, about the level of its services. I suggest to the Committee that this is what creates confusion and delay and not the situation as it would be after the amendments.
One final sentence, if I may: the noble Lord again tried to bring into the debate what he called "indiscriminate subsidy". It must be repeated on every occasion that this is said that the Bill is not about subsidy. It is about revenue grants from authorities to their executives, but it is not about subsidy as I think it is becoming understood, which is subsidy from central Government to local authority ratepayers. That subsidy is and will remain, as I understand it, the concern of the transport supplementary grant and the TPP procedure. I think it is possible, I am sure through inadvertence, that a number of noble Lords may be misled by the use of the word "subsidy" into thinking that we are dealing with the proper responsibility of central Government which is its own expenditure and
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not that with which the Bill is concerned, which is the proper responsibility of the local authorities, their own expenditure.
Lord Teviot: On this I fully support my noble friend. The noble Lord, Lord Underhill has been persuasive in moving this series of amendments. At first sight I must say I was tempted to agree with them. They seem to overcome the danger of this Bill, as one previously put it, in making the executives the whipping boys of both central and local government. The co-operation between executive and authority is in preparing a joint plan to ensure that the authorities' general policy is fully taken into account. However, this really cannot be in doubt.
When one looks at the principal legislation, the Transport Act 1968, one finds that it is the duty of the authority to determine the general policy to be followed by the executive. This is spelt out in terms of financial control and the ability to purchase any specific service or level of service from the executive. Beyond that it is the duty of the executive to provide services and to provide professional management of those services. There is the crunch, and, as I said at Second Reading, even if it is necessary for management to manage, even if it is within a general policy defended by policy makers, I believe that the 1968 Act has matters in perspective and its balanced view is maintained in Clause 6(1) of the present Bill which requires the executive, before preparing its financial plan, to consult the authority. That is the right level.
I must say I was a little surprised when the noble Lord, Lord Underhill, quite rightly quoted Dr. David Quarmby in this context. I do not know whether he is saying that either London Transport or the passenger executive, the employers of transport, are in agreement with these amendments; however, I somewhat doubt that. The executives would, within the policies of the authorities, plan and manage; that is their statutory and professional responsibility. If the authority is jointly the author of a plan it is plaintiff and judge in its own case. There is no balance. I hope your Lordships will not support this amendment.
Lord Molloy: I wonder whether the noble Lord, Lord Bellwin can help me. I followed his exposition and argument very closely and it seemed to me that perhaps a fair analogy with what the noble Lord was saying is this. The Chancellor of the Exchequer we all know does not give every small detail of his Budget. That is worked out by top-flight civil servants. Therefore, according to the noble Lord, those top-flight civil servants in the Treasury have a certain degree of responsibility for the Budget, as much as the Chancellor has. They would recommend things which he would have to accept. I do not believe that for one minute. Therefore, if the principle has to be adopted all the way down, we have to realise that the executives are employed, by permission of Act of Parliament, by the local authorities, The moment that we start giving those who are employed by the elected representatives a degree of authority which appears to be outside the normal scope of behaviour of either national or local government it seems to me that we are starting towards a process which would not merely be undemocratic but exceedingly dangerous.

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The noble Lord, Lord Bellwin, quite rightly said that the local authority, or whatever it may be, would say, "We are allowed to engage an executive committee to run our transport system". I should have thought that what follows, provided that the authority was within the law of the realm, is that the executive must do what the authority asks it to do. That is what it must be. Therefore there must be no Act of Parliament which says, or even adumbrates, what that executive must do. That is why these words must be cut right out. It must be the elected representatives. We must in no way accept an Act of Parliament which tells the officials of the Treasury: "You will do this, that or the other, irrespective of what the Chancellor or the Government of the day think". In so far as we would not dream of doing something like that, we must maintain the principle. Because the local authority is allowed to recruit it, pay the salaries and write the terms of employment, the local authority is entitled to tell the executive to prepare all sorts of plans. But once that is in an Act of Parliament and indicates that an executive must do something, I believe it is bad for the executive, any executive, it is bad for the local authority and it is certainly had for the principle of democracy.
Lord Sefton of Garston: I am a little mystified, because when the noble Lord, Lord Bellwin, sat down he had almost convinced me that there really was no change in the Bill. When he said that the relationships between the local authority and the executive remained the same, he almost had me believe it. But it is not the same, because if it was the same there would be no harm in accepting the amendments. There would be no harm because things would have stayed as they were. So what is the difference? What is this amazing thing that converts the noble Lord, Lord Bellwin, from one of the staunchest supporters of local authorities that I have ever heard speak on the AMA? At the time when the first Water Bill was going through he stalwartly defended the right of local authorities' members to have their say. The Government were saying at the time, "There is no harm". They were saying to the Association of Metropolitan Authorities, "You will have x number of representatives and in fact, you will have a majority". Thus, everything was the same.
Of course it was then, but that is not the underlying threat in the Bill. It is not that we have to prove that it will perhaps stay the same, because the executive, in a prolonged way of preparing the plan, will waste time and can have its own way this year. What is the purpose of including these words in the clause? Let me give your Lordships the scenario. The local authorities still appoint the executives. As far as I know there has not been a change. When I was the leader of the Merseyside County Council I took what I thought was a wise step, to appoint to the executive some of the chief officers of the Merseyside County Council. I did not believe that the executive had in mind enough the social and economic wellbeing of Merseyside interests, so I put them on.
Now we have the situation where local authorities did that and in such numbers and with such personnel that they knew that in the preparation of that plan, if
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it was insisted on, the views of the local authority would be fed in as an input right at the beginning. The noble Lord nods his head. He thinks that is all right. Of course it is, but what would be the consequences? It would not be long before the civil servants in the Department of Transport were saying: "This has got out of hand. The executives are actually being controlled by the local authorities." Then what would happen? Of course we know what the next step is; there would be another Transport Bill.
That is exactly what the noble Lord, Lord Bellwin, said when discussing water. When I stood up at the AMA and warned it to have nothing to do with the Bill and nothing to do with the bribe that was given by central Government to put more local authorities on the water undertakings, they all said: "Oh no, Sefton is imagining things". My forecast was that within a very short period power would be taken right out of the hands of the elected representatives. What happened in this Chamber? Of course power has gone from the elected representatives. Water has now become a matter of consultation between central Government and the local water authority, which has no relationship to democracy at all. The net effect of this clause will be the same. It will not be long before transport goes the way of all the other services that local authorities were once proud of. They will have gone completely and will be in the hands of a bureaucracy that no one can control.
5.52 p.m.
Lord Bellwin: I enjoyed, as I always do, the impassioned speech of the noble Lord, Lord Sefton. No one does it better, but I had great difficulty in seeing where we are differing. I have always had that difficulty in the past, and I am still having it.
Perhaps it would help if I simply explained that, as I understand it, in fact what the Bill calls for is for no real direct reporting by the executives. The position simply is that they copy their plan to the Secretary of State for information—I repeat, for information. The noble Lord keeps telling me about nodding my head. I only nod my head when I agree with him, and if I am nodding it frequently he ought to be pleased about that. Now he is nodding his head, but I am not sure whether he agrees or disagrees
However, this is how it will work. This is what the Bill says. If there is confusion I can do no better than clarify the position and end the confusion. The executive will copy its plan to the Secretary of State for information, but the plan routes via the authority and it is the authority which decides to modify before sending it in the end to the Secretary of State. Only the authority can adopt the plan and determine the grant that it will give to the executive, after having had regard to the Secretary of State's guidance on the PEL. I think that is a very simple and straightforward procedure. I am very grateful to my noble friend Lord Teviot for confirming that he agrees with it as well.
I am anxious to pick up the point made by the noble Lord, Lord Molloy, that civil servants made recommendations which, he was afraid, the Chancellor must accept. I assure him that the Chancellor is not likely to accept exactly what they say unless he agrees with them, which he may well do; I do not know. The important thing is, where does the final decision lie?

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The noble Lord opposite, I am sure, will be happy to hear me confirm that it lies in the end with the authority. After having done all it has to do with the executive, and after having learned through the executive and the Secretary of State's guidance, at the end of the day the authority will make the decision. What happens when that decision is taken—whether it decides that it will set fares at certain levels, or whatever—The PEL will then step in and say, "Below this point you have no fears of legal challenge, beyond that point you may; but yours is the decision." That is what it is about.
However, before we get into all that, as I am sure we will several times again, I am anxious to take the point made by the noble Lord, Lord Mishcon, earlier, because I do not want to get into Second Reading debates either. If I may stick to the amendment, I feel that if it is the procedures and the style that we are concerned about, then the amendment really is not necessary. These are not the key points of the Bill. It is important to know who will be making the decision and I am saying that it is the authority.
Lord McIntosh of Haringey: Before the noble Lord sits down, will he confirm or deny whether this is happening already? Are civil servants from the Department of Transport already rooting around in the executives asking detailed questions about their operations? That is the gravamen of the charge in these amendments.
Lord Bellwin: The Bill is not yet on the statute book. Therefore, nothing is or can be done that has effect in law. However, if the department is doing as the noble Lord says, and I am assuming that it is doing so although I really do not know, then it is learning as it goes, because at the end of the day it will have to make certain judgments. It can in any case do no harm. In my own knowledge, and certainly in the knowledge of all the noble Lords opposite who have spoken on this today, who all have considerable local government background, it is absolutely par for the course for departments to be talking with the various bodies and discussing various matters. The noble Lord may fear that there is something sinister in this, and from where he sits he may be right, but I suspect not. I would not attach too much concern to that.
Lord Molloy: Will the Minister consider this very vital aspect: in this Bill, as it stands, and probably in no other Bill passed by any Parliament, there is one group of people—I beg your Lordships to listen to this argument—employed by a local authority which will have an advantage that town clerks, deputy town clerks, planning officers, or anyone, will not have. It will, if this Bill goes through without the amendment, be able to challenge the elected authority by the words of an Act of Parliament. I refer to the executives. We should leave it as the amendment proposes and which would fit into the argument submitted by the noble Lord, Lord Bellwin, just as much as it would fit into the argument as submitted by my noble friend Lord Underhill. We must look at it in the context of the Bill giving special provision for only one group of people employed by a local authority, who could challenge
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that local authority with an Act of Parliament because it is mentioned in it. Let us take it out for the benefit of the principle of local government as it applies today.
Lord Bellwin: I honestly feel that the noble Lord is not right. I am sure that he believes that he is right, but I think his concern is not properly founded. It is exactly as I said. If he will read carefully what I said, as I am sure he will, without my going over it all again, he will find that at the end of the day the decision on the adoption, or otherwise, is with the authority.
Lord Molloy: It can be challenged.
Lord Bellwin: Only if it decides as a matter of policy. If the authority, not the executive, decides as a matter of policy to go above the PEL, as it may well decide as being reasonable to do, then and only then can it be challenged. But the ultimate decision lies with the authority.
Lord Mishcon: I believe that this argument on this amendment can be brought into a very short series of sentences. Either we are right in saying that local government is being put under a handicap by this clause, or we are wrong. Either we are right in saying that the dignity and the jurisdiction of local government is being infringed, or we are wrong. The Minister says that there is no infringement of dignity or jurisdiction and really no difference in normal local government and national procedures. If he is right then this amendment deserves to de defeated. If I can satisfy your Lordships very shortly that he is wrong, then your Lordships ought objectively, if I may say so, to vote for the amendment.
Let us consider things in this simple way because it is a simple issue. I served in local government for just over 20 years and had the privilege of spending quite a bit of that time with the noble Lord, Lord Plummer of St. Marylebone. Both of us in our individual places on opposite sides of County Hall fought for the independence of policymakers as against those who were the experts who carried out the policy. There was no division between officers and those whom we appointed in regard to responsibilities. I would ask anybody who ever knew anything about local government what they would think of a procedure under which the chief engineer or the chief transport officer was required to send a copy of his report to the council, first to a Minister of the Crown or, equally at the same time, to a Minister of the Crown and the chairman of his committee. If that were to happen there would be an outcry that, quite obviously, the whole basis of local government had been infringed.
As I understand it—but the noble Lord the Minister will correct me if I am wrong, and I shall sit down immediately he begins to rise, if he wants to rise—the procedure is the following, and it is as simple as this. The Government, irritated by a few local authorities which they feel have gone beyond the limit, are bringing in a Bill which affects every local authority—good, bad or indifferent. Transport is the vital field of many of those local authorities. As I understand it, those appointed by the local authority, the transport executive, will prepare a plan. A copy of that plan—and this is where I wait for the noble Lord

979
the Minister to correct me if I am wrong—goes at that stage, in its primary state, to the Minister. It goes to him before the policymakers have had an opportunity of dealing with it at all, although it may be after consultation; one does not know. The noble Lord the Minister does not rise, so I assume that I am correct so far. As I said, the analogy is a copy of the town clerk's report to the general purposes committee going to the Home Office first of all or to the Minister for Local Government, or whoever it may be.
After that it is quite right, as the Minister says, that the local authority can amend the plan. It will be for them to approve it. But the difference that has been created which upsets the whole of the dignity and jurisdiction of local government, and upsets, too, the whole differential between the job of the officer and the expert and the democratically elected policymaker, is that the Crown is in receipt, the Minister is in receipt, of the first plan and the Minister can then say, when he is fixing the level beyond which the local authority must not go, "I know what your officers whom you employed, your transport executive, had to say first of all, before you altered this plan. This could have been done in a very different way". Then you get—and it is the thin end of the wedge—not only an alteration in traditional historic relationships between the officer and the expert and the policymaker democratically elected in local government—a differential that has existed ever since local government was proudly created by this country—but also the possibility arising of the transport executive being blamed by the local authority: "You put that in the plan. You remember we had a meeting a fortnight ago when we told you that we did not agree with that. Look what you have done." Thus you have created again a division between the local authority and the executive which might not exist.
Before I sit down, I ask the noble Lord the Minister the following question: if I am wrong, if I am exaggerating, if I am creating bogies that do not exist, would he please tell me why he wants to see the plan before it is approved by the local authority? If he will answer that question I shall be very interested, because all he has got to say is, "No, it is not because I want to be able to argue from the original plan against the local authority when fixing my level". All he has got to say is, "I agree it makes no difference to me if I see the plan as it finally comes forward from the authority, approved by them and subject to their own amendments".
I await with interest for the answer to that point, because in my view it is the core, central to the whole issue. We are either right in thinking that there is an alteration, or we are wrong. We are either right in thinking that it means something, or we are wrong. If it means nothing, then I hope that the Minister will agree that the first report need not go to the Minister but ought to go to the authority, and that means that this amendment ought to succeed.
Lord Somers: With the greatest respect, may I suggest to the noble Lord, Lord Mishcon, that the Minister of State has also been democratically elected.
Lord Bellwin: I am grateful to the noble Lord, Lord Mishcon. At least I now clearly understand the concern in a way that I may have missed previously. But I am still absolutely convinced, and I hope to be able to satisfy him, that in fact it is not so sinister a matter, it is not such an erosion, if I may put it that way, of the local autonomy situation. I take the point that the noble Lord, Lord Sefton, made when he said that I was a staunch defender of local democracy—I hope that I always will be. The matter that seemed most to concern the noble Lord was the rectitude—if that is the right word, but it probably is not—of passing a plan to the authority and at the same time to the Secretary of State. The noble Lord asks: why should it have to go that way, in that sequence? The Bill specifically requires a Secretary of State to give guidance—that is the operative word—as to the PEL. If in fact he was to wait until he had an agreed plan from the authority rather than having it come to him at the same time from the executive, that would be the end of the day.
What will happen under the Bill when it becomes an Act is that the Secretary of State, having received the plan, will consider it and then give the authority the guidance that they absolutely must have in coming to a conclusion as to the final decisions they take regarding the level of fares and so on. If that were to be the end of the game, I should be sympathetic to what the noble Lord says. But the fact is that no one is seeking to trample on anyone or to override anyone. The hope, the expectation and the wish of all the provisions in the Bill are that we shall in future have a régime of charging where the authority concerned will know up to what level they are free of any legal challenge, in a way that they do not know at present. It is said that this particular issue is about an infringement of local authority powers—in fact "powers" is not the right word; the noble Lord put his argument so well that I should have to read it in order to put it in exactly the way in which he put it, but I understand the point that concerns him. But I do not think that it should concern him, because it is not an infringement in any way, not even an impingement, on local authorities. At the end of the day the authority will decide. They will have before them their own plan, which they can have discussed with their executives. After all, in fairness it must be said—and I do not want to overstate this because I am most concerned with the authority's position—that the executive is an independent body. It even has powers to promote Bills of its own.
Having said that, I want to major on the point that at the end of the day it is the authority which will decide. The question is whether it is right that the initial plan should at the same time go to the Secretary of State so that he can give guidance as to the PEL. I now understand the fine point that is being made. I still think that it is one that should not worry anyone. It certainly would not worry me if I was in the position of the noble Lord, Lord Sefton, in making the decision at the end of the day if I had before me, first, a plan from the executive and, secondly, the guidance from the Secretary of State as to the PEL. The decision would then be mine. I should have thought that that was the major point.
Lord Sefton of Garston: On a point of clarification, did I understand the noble Lord to say that the plan

981
would be prepared by the executive, then submitted to the Minister and the local authority at the same time, and then the Minister would determine the PEL? That is not the position, because Clause 3(5) on page 3 of the Bill, at line 35, says that the plan will be prepared in consultation with the Ministry—that is, before the plan is formulated. So the situation is not that the plan will go to the Minister and the local authority, but that the Ministry will say to the passenger transport executive, "Take this guidance into account when you produce your plan". In effect, we have shifted the preparation of the plan from local authorities to the Ministry. It is in the Bill.
Lord Bellwin: That just is not my interpretation of it at all. I am reading the same clause as the noble Lord. It means exactly what I said it meant before, and if you want me to go over it again, I shall be glad to do so.
6.13 p.m.
Lord Pitt of Hampstead: If, in effect, the executive is expected to prepare a plan, in the preparation of which it has to take guidance from the Minister, then obviously the plan is being prepared between the Secretary of State and the executive. Then, at that stage, the authority gets it. But let us face it, the authority gets a plan which the Ministry and the executive have prepared together. What powers does the authority really have? It can override the Minister and the executive and then, finally, the Minister can say, "But that is the level beyond which you cannot go". In other words, the authority is being put in the middle. The Ministry and the executive are preparing plans which the Ministry finally approves. Then, if the authority does not happen to agree with the Ministry, it can be set up as the proverbial target to be shot at, because in effect at all material times the executive and the Ministry have discussed these matters. When the matters actually come to the authority, they come to the authority having been agreed between the executive and the Ministry.
Lord Bellwin: You can interpret it one way or the other. I still think that my interpretation is correct, but it matters not, because at the end of the day the final decision lies with the authority. At the end of the day it decides.
Lord Sefton of Garston: Perhaps we can clear up this matter, because I am very concerned about relations between that Front Bench, local government and this Front Bench. I am taking it that the noble Lord, Lord Bellwin, is giving us an assurance that the preparation of the plan is entirely a matter for the executive in the first place, and that it is not determined in consultation with the Ministry. Am I getting that assurance, or not?
Lord Bellwin: The Bill says quite clearly:
"In preparing the plan the Executive shall take into account any advice"—
I repeat, advice—
"given by the Secretary of State as to the amounts"—
et cetera, et cetera. That does not make them decide anything. The fact that they get advice surely must be helpful. But at the end of the day the decision is taken by the authority. It must be so.
Lord McIntosh of Haringey: Will the Minister read on? Where he said "et cetera, et cetera", it says:
"any advice given by the Secretary of State as to the amounts that it would be appropriate for the Executive to determine under subsection (3) above and the method of determining the benefits referred to in that subsection".
Subsection (3) is absolutely fundamental because it contains the basic duty of the executive to provide transport services under the Bill. Is it not the case that the Secretary of State is, in fact, giving advice—and "advice" is a weasel word for something stronger than that, as we know throughout this Bill—before a plan even goes to the authority in the first place?
Lord Bellwin: I would not know about weasel words, but the fact is that it is there in front of us. I think that my interpreatation is right. It is indeed advice, but at the end of the day the decision is the authority's and it will decide. When we are talking about local autonomy, to me that is what matters.
Lord Underhill: I am certain that the noble Lord the Minister would not say that that is what matters if he was back in his position on the Leeds City Council. In his previous remarks the Minister again referred to the question of the revenue grants. I want to assure every noble Lord in the Committee that at the moment we are not discussing any alteration of the proposals in the Bill for determining revenue grants. I make it quite clear; all we are dealing with is the position of the executive vis-à-vis the authority and the Secretary of State. We are not dealing with the question of revenue grants.
Let us just see exactly what is the situation. I shall not read the text; I will paraphrase it. First, the executive has to supply information to the Secretary of State, as he may request. It is not to go to the authority—the elected body responsible to the electors—and say, "Will you please supply this information?" No, it goes to the operators—the full-time officials—to get the information.
Then we are all agreed that the executive has to prepare the plan, and we are all agreed that a copy of any plan or information which the executive sends to the authority also has to be sent to the Secretary of State. I shall paraphrase what subsection (5) of Clause 3 says. First, in preparing the plan the executive has to take into account the advice of the Secretary of State on the determination of proposed grants. Secondly, the executive has to take into account advice on the method of determining the benefits from the grants. Thirdly, the executive has to take into account the advice generally as to the form and contents of the plan. That means all local passenger transport details. Fourthly, the executive:
"shall take into account the advice"
of the Secretary of State on the method of determining the costs of providing the services, the level of demand, and benefits to potential users. But that is not the finish.
Turn over the page and you will find a provision that, in considering whether to approve the plan which the executive has prepared, the authority shall have regard to the advice given by the Secretary of State to the executive. In other words, the authority must take into account the advice given to the executive when it

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considers the plan submitted by the executive. I am certain that the noble Lord the Minister would have sent letters of protest if anyone had dared do this while he was active in local government.
Reference has been made to the letter from Dr. Quarmby. I make it quite clear; I understand that he is the chairman of all the PTE groups. Let me remind your Lordships of what he said.
"On behalf of the PTEs"—
that is, all six PTEs—
"and the London Transport Executive, I give confirmation that we are with the metropolitan councils in supporting the concept of jointly submitted plans in place of the separate planning processes envisaged in the Bill".
So the elected transport authorities—the county councils—do not like the proposals in the Bill; they want joint action and joint plans. The appointed transport executives do not like it either, and they are with the bodies which, in effect, control them. Both the PTEs and the PTAs want the amendments which I have put forward. That is what their letter means. All we are talking about is joint preparation of the plans—we are not saying that the authority deals with it by itself—and that the information and all the advice should be given, as one would expect, through the proper channels.
I cannot understand why the Government object to what we are asking. It is so elementary. Why do they object? Is it because they want to give this advice to the appointed executive, which then the elected authority has to take into account otherwise there are going to be difficulties for them under the PEL? If both the PTEs and the PTAs want this change I cannot understand why the Government resist it. If every noble Lord in this Committee really reflects on what has been said, I do not think that one noble Lord will understand why the Government resist it. Therefore, I hope that we shall carry these amendments in the Division. They are simple. They have no relation at all to changing the Government's intention under the Bill regarding determination of grants. It is a question of the proper relationship between the elected body and the appointed body, and the relationship to the Secretary of State. I beg to move.
6.21 p.m.
On Question, Whether the said amendment (No. 8) shall be agreed to?
Their Lordships divided: Contents, 58; Not-Contents, 97.

DIVISION NO. 2

CONTENTS

Ardwick, L.

Davies of Penrhys, L.

Aylestone, L.

Denington, B.

Bacon, B.

Diamond, L.

Balogh, L.

Elwyn-Jones, L.

Bishopston, L.

Ewart-Biggs, B.

Boston of Faversham, L.

Fisher of Rednal, B.

Brockway, L.

Gladwyn, L.

Brooks of Tremorfa, L.

Hale, L.

Bruce of Donington, L.

Hall, V.

Cledwyn of Penrhos, L.

Hampton, L.

Collison, L.

Hanworth, V,

David, B.

Hatch of Lusby, L.

984

Hooson, L.

Seear, B.

Jeger, B.

Sefton of Garston, L.

John-Mackie, L.

Segal, L.

Kennet, L.

Stedman, B.

Kilmarnock, L.

Stewart of Alvechurch, B.

Llewelyn-Davies of Hastoe, B.

Stewart of Fulham, L.

Lloyd of Kilgerran, L.

Stone, L.

McGregor of Durris, L.

Strabolgi, L.

McIntosh of Haringey, L.

Tanlaw, L.

Mishcon, L.

Taylor of Mansfield, L.

Nicol, B.

Tordoff, L. [Teller.]

Oram, L.

Underhill, L.

Peart, L.

Wallace of Coslany, L.

Phillips, B.

Whaddon, L.

Pitt of Hampstead, L.

White, B.

Ponsonby of Shulbrede, L. [Teller.]

Winterbottom, L.

Wootton of Abinger, B.

Ross of Marnock, L.

NOT-CONTENTS

Alexander of Tunis, E.

Lyell, L.

Ampthill, L.

McAlpine of Moffat, L.

Auckland, L.

Mackay of Clashfern, L.

Avon, E.

MacLeod of Borve, B.

Bellwin, L.

Malmesbury, E.

Belstead, L.

Mancroft, L.

Bessborough, E.

Mansfield, E.

Boardman, L.

Margadale, L.

Boyd-Carpenter, L.

Marley, L.

Brabazon of Tara, L.

Merrivale, L.

Caithness, E.

Mersey, V.

Campbell of Alloway, L.

Molson, L.

Campbell of Croy, L.

Monson, L.

Carnegy of Lour, B.

Mottistone, L.

Cathcart, E.

Mountevans, L.

Chelwood, L.

Murton of Lindisfarne, L.

Coleraine, L.

Napier and Ettrick, L.

Colwyn, L.

Nugent of Guildford, L.

Cork and Orrery, E.

Orkney, E.

Cottesloe, L.

Pender, L.

Craigavon, V.

Penrhyn, L.

Cullen of Ashbourne, L.

Plummer of St. Marylebone, L.

Davidson, V.

Rankeillour, L.

Denham, L. [Teller.]

St. Aldwyn, E.

Drumalbyn, L.

St. Davids, V.

Elles, B.

Salisbury, M.

Elliot of Harwood, B.

Saltoun, Ly.

Elton, L.

Sandford, L.

Enniskillen, E.

Seebohm, L.

Fairfax of Cameron, L.

Selkirk, E.

Ferrers, E.

Sharples, B.

Fraser of Kilmorack, L.

Skelmersdale, L.

Glenarthur, L.

Slim, V.

Glenkinglas, L.

Somers, L.

Gridley, L.

Strathspey, L.

Grimston of Westbury, L.

Sudeley, L.

Hailsham of Saint Marylebone, L.

Swinfen, L.

Swinton, E. [Teller.]

Harmar-Nicholls, L.

Terrington, L.

Henley, L.

Teviot, L.

Hornsby-Smith, B.

Teynham, L.

Hylton-Foster, B.

Tranmire, L.

Killearn, L.

Trefgarne, L.

Kimberley, E.

Trumpington, B.

Kinloss, Ly.

Vaux of Harrowden, L.

Lane-Fox, B.

Vivian, L.

Lauderdale, E.

Wakefield of Kendal, L.

Long, V.

Windlesham, L.

Lucas of Chilworth, L.

Young, B.

Resolved in the negative, and amendment disagreed to accordingly.
[Amendment No. 9 not moved.]
6.29 p.m.
Lord Underhill Lord Underhill moved Amendment No. 10:
Page 2, line 35, at end insert ("or if the Authority because of an unforeseen major change in circumstances decide to increase the amount of the revenue grant payable to the Executive during the accounting period").
The noble Lord said: In contrast to the large group of 19 amendments this is a simple, single amendment. All it asks is that where there are changes of circumstances, circumstances that were unforeseen at the time of determining the amount of revenue grant, the authority should have power to increase the amount of the revenue grant payable to the executive during the particular accounting period. This would appear to be sheer common sense. There are noble Lords among us with far more business experience than I have. The noble Lord the Minister has stressed that the executive and the authorities ought to act on commercial lines in these matters. It is common sense business practice that something like this should be done.
At the Second Reading reference was made to a statement by Ministers in the other place that in the event of such a situation arising the position could be dealt with by borrowing. That, I suggest, could be bad business because it would mean having to make up the borrowing in the following year, and that could affect the protected expenditure level for that year, apart from there being charges in connection with borrowing.
I recognise that such a decision would have to be taken by the elected authority, but let us consider some of the unforeseen circumstances that could arise. There could be the sort of severe winter conditions we had last year; that could affect the whole of the operations and revenue of a transport executive. There might be severe flooding in the area, and that could affect their operations for a time as well as their revenues. There might be disastrous petrol price increases—I must remember to use the right word, with the noble Lord, Lord Lucas, present, and not say "petrol" but "diesel"—and that could affect the whole situation. On the other hand, there could be unfortunate industrial action, and that too could affect revenues. It must be common sense therefore that an executive should have power to increase its grant during the current year and not have to borrow, which could be bad business and affect all operations in the following year.
Lord Bellwin: One of the prime purposes of the Bill is to introduce a planning process into the assessment of transport needs so that transport services can be planned and provided for on a stable and rational basis. Accordingly, the scheme of the Bill provides for one grant determination each year, based on proposals set out in the plan. As the noble Lord, Lord Underhill, said, the purpose of the amendment is to enable an authority to provide additional grant during the year to cover any unforeseen circumstances which, of their nature, would not be provided for in the plan. This would mean that an executive could, for example, negotiate a high wage settlement or, for some reason or another, increase its level of services, and cover the additional costs through increased grant from the authority, rather than by reducing costs elsewhere or increasing fares. That would constitute very poor financial practice and would seriously weaken the new financial duty on the executives to break even. Thus, the amendment would encourage inefficiency—dare I say it?—and loose management, and cause ineffective financial control. That could not be in the best
986
interests of the executives, the authorities, the ratepayers or the travelling public.
The amendment is also designed to cover unforeseen circumstances such as floods or other natural disasters. But such circumstances can be covered by borrowing or by the planned use of reserves, which can then be taken into account in the following year's plan and either made good by the planned use of reserves, by fare increases or covered by the grant determination for that year, as appropriate. So the amendment is not necessary to cover such circumstances.
I am bound also to point out that, as drafted, the amendment would not achieve very much. Clause 2(3) sets out the circumstances in which an executive is not required to make good a deficit. If an authority were able to make additional revenue grant to meet the deficit, there would be no deficit to make good. Under the Bill, an authority can make only one grant determination, and the amendment would not change the situation. The additional grant would therefore have to be within the single grant determination and not an extra grant. Perhaps the noble Lord will feel, on reflection, that the points I have made are valid and will not wish to proceed with the amendment.
Lord Underhill: The noble Lord, Lord Bellwin, is always persuasive but not always convincing. He says there is a planning process and that we should not disturb what is intended to be a stable and rational basis. But it must be rational not to have to use borrowing for unforeseen circumstances. The noble Lord repeated what was said on Second Reading, and it means compelling a local authority to go for borrowing in such circumstances. Indeed, as I listened to him I thought of another eventuality; there might be a disastrous fire resulting in the destruction of a great many vehicles. Action would need to be taken quickly. Surely it would be better for a grant to be made than go to borrowing. I do not know what noble Lords with experience think of such matters in terms of business management. I should have said that rather than encourage loose management, the amendment would prevent that, in view of the fact that a loose decision on borrowing could result in loose management. What is suggested in the amendment could be more economic. However, I shall, as the Minister suggests, look carefully at what he said. It may be that the amendment is badly drafted, and we shall take that into consideration in considering whether to return to the matter on Report. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 2 agreed to.
Clause 3 [Preparation and submission of financial plans]:
[Amendments Nos. 11 to 15 not moved.]
6.38 p.m.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 16:
Page 3, line 12, at end insert ("and
(c) the provision of a properly integrated and efficient system of public passenger transport to meet the needs of their area, with due regard to the town planning and traffic planning

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policies of the Authority and to economy and safety of operations.").
The noble Lord said: The wording of this amendment will no doubt be familiar to noble Lords; it comes from Section 9(3) of the 1968 Act and it is the remainder of the obligation on transport authorities to provide the level of public transport service best suited to their areas. The public transport authorities will find themselves in a curious situation if or when the Bill is passed unamended because the TPP transport supplementary grant procedure will still continue, yet on top of it will be put the procedure under the Bill.
The requirements on an authority—and, through the authority, on the executive—are different in each case. Under the 1968 and 1969 Acts, all parts of transport strategy (including not only public transport but the policies for road development, traffic management, and so on) are contained underneath obligations which include the words of the amendment:
"the provision of a properly integrated and efficient system of public passenger transport to meet the needs of their area, with due regard to the town planning and traffic planning policies of the Authority and to economy and safety of operations".
It is not intended that the procedures under the Bill should replace entirely the TPP procedure. It is intended that they should supersede those parts at present required in connection with bids for Government support for public transport alone.
"The TPP would, however,"—
and again I am quoting from the document Proposals for Legislation on Public Transport Subsidies—
"continue to contain any information which the county wished to provide on overall transport strategy …".
If I am wrong, no doubt we can be reassured on the matter, but as I understand it, that means that there are two different standards of judgment for different parts of transport policy. For roads policy, policies on traffic management, and all the other strands of transport policy, we have the conditions of the 1968 and 1969 Acts, and for public transport alone we have the very much more limited provisions of Clause 3(1)(a) and (b). They refer to,
"the general level of transport services and facilities …",
and to,
"the general level and structure of the fares …",
but do not in any other way refer to, for example, the town planning and traffic planning policies of the authority, or even—and one should have thought that this was an obvious point—to economy and safety of operations.
So in preparing a total TPP the authorities are proceeding, on the one hand, on a reasonably well-tried and tested series of objectives which, in a period of nearly four years, the present Government have not attempted to amend, and, on the other hand, on a very much more limited and unsatisfactory series of objectives which are set down by the Bill. I know that the final decisions on the timing of the TPP submission and on the submission under the Bill have not yet been determined, but it seems at least likely that the submissions will be proceeding at different times of the year and the local authorities will find themselves in the position of having a split personality in terms of
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both the timing of their submissions and the objectives on which the submissions are to be based.
The wording that is proposed in the amendment is not revolutionary. It has been accepted by successive Governments as providing the proper way to deal with transport strategy over a period of years. It cannot be said to apply any less to public transport than to any other part of the tranport policy of a local authority, and I suggest to your Lordships' Committee that it ought to be included in the Bill. I beg to move.
Lord Bellwin: I have not a great deal to say on the amendment. I suggest that if it were accepted it would distort the purpose of paragraphs (a) and (b) of Clause 3(1). As they stand, the paragraphs define the content of the plan which the executive is required to prepare, setting out its proposals for the three years ahead. The paragraphs achieve that by referring to the two basic elements which any transport plan must contain: proposals for the level of services to be provided, and the fares to be charged. As against that, the amendment would add an issue—the need to provide a properly integrated transport system—which I suggest is more a description of one of the considerations which should be taken into account than of the basic content of the plan.
This issue is largely a repetition of the duties which are already laid on both the executive and the authority by Section 9 of the Transport Act 1968 (to which the noble Lord referred) and Sections 1, 2 and 5 of the Transport (London) Act 1969. Those duties will of course remain binding, and I should have thought there was no need to refer to them in the present context. That is why we cannot accept the amendment. As to the point that the noble Lord made about the timing of the plan under the Bill, it will be similar to that for the TPPs. We expect to ask for them both to arrive by late July.
Lord McIntosh of Haringey: I wonder whether the noble Lord the Minister would agree that in the advice that has already gone out from his department it is suggested, with the laudable intention of minimising extra demands on authorities and executives, that the information provided in the plan—in other words, the more restricted information which is now required—should supersede that at present required in connection with bids for Government support. So, if I understand the noble Lord correctly, those proposals, which are not of course final, will now themselves be superseded by the statements that he is making today.
Lord Bellwin: What I am saying today is the "latest stuff", if I may put it that way. I think that it is basically correct. If in due course I have any cause to feel otherwise, I shall immediately inform the noble Lord.
Lord Tordoff: In supporting the Amendment, I would point out that line 5 on page 3 of the Bill refers to the general level of transport. In a sense it is a two-dimensional requirement. The amendment adds a third dimension in terms of the integration of transport, which is not necessarily contained within Clause 3(1)(a).
Lord Underhill: In supporting my noble friend in his amendment, I should like to take up a point that the Minister commented upon in his reply, when he said that there is no need for the amendment because the points are covered by Section 9 of the 1968 Act and the appropriate section of the 1969 Act. I wonder whether that means that the Minister will be prepared to accept a later amendment which proposes that those duties laid down in the 1968 and 1969 Acts shall be taken into consideration? That is what the Minister is implying. If the Minister says that these points are covered, surely we ought to ensure that the executive, in preparing the plan—which according to the clause it has to do—ought to take into consideration the duties laid upon it by the provision of the two earlier Acts that have been mentioned.
The amendment is proposing that the executive must pay regard in the plan to a properly integrated and efficient system of public transport to meet the needs of the area. That is a duty that is laid down in the 1968 and 1969 Acts. I hope that the Minister is not saying that there is no need for the plan to have regard to those points, because a duty is placed upon the executive and the authority to do so. Surely we ought to make it absolutely clear that in preparing the plan regard must be paid to those points, and my noble friend's amendment lays this down in terms:
"the provision of a properly integrated and efficient system of public passenger transport …".
The amendment then goes on to refer to questions of town planning. Along with the noble Baroness, Lady Fisher of Rednal, last Tuesday I had the pleasure of going to Newcastle to look at the Metro system and to see how it is a real integrated system and how regard is paid to town planning consideration. We were able to see how the Metro system and the bus halts fit in with the planning of vast shopping precincts in the area. Time will not permit me to elaborate, but it was most interesting to learn how planning had to be taken into consideration by the Tyne and Wear authority when it planned its Metro system, with integration of tickets and everything else on bus, rail, and the Metro. Town planning was one of the serious considerations that had to be taken into account. There is no reference to that consideration in Clause 3(1), and that is why I believe we ought to support the amendment.
Lord Bellwin: Rather than mention it now, I shall write to the noble Lord and send him the chronology of the planning process in a normal year. It might help him in considering what he might later want to do about his proposal—that is, assuming that he does not want to do something about it this evening, which of course he may decide to do. I think that if I were to do that, it would be helpful. I hear what the noble Lord says, and I, too, have been to the Tyne and Wear Metro. Indeed, I opened part of it myself. I found it very impressive, and I like it very much. I hope that it proves to be as successful over the long term as it looks as though it might be over the short term, but only time will tell as to that. I feel that I cannot help the noble Lord any further on this matter. I have explained why we cannot accept the amendment, but clearly the noble Lord will want to consider further what I have said.
Lord McIntosh of Haringey: In view of what the Minister has said on more than one occasion on this
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amendment, and in view of what my noble friend Lord Underhill has said, it would be better if we considered how to put a better amendment at Report stage. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
6.51 p.m.
Lord Teviot Lord Teviot moved Amendment No. 17:
Page 3, line 33, leave out ("potential users").
The noble Lord said: I beg to move Amendment No. 17. This amendment reflects the concern that I expressed at Second Reading regarding the details of Clause 3. What I had in mind is the inconsistency that I find both within the Bill, and between the Bill and the White Paper Public Transport Subsidy in Cities (Command 8735). In the Bill itself there are three different ways in which "benefits" are spelt out. We have been talking about benefits this afternoon but this is in a different context. If I take some time in trying to make the position clear, it is because this measure was introduced to achieve clarity. The whole object of the exercise will be set at nothing—before the ink is dry—if a variety of rules is set for the interpretation of "benefit".
At this stage, I should like just to point out the different wordings relating to benefits, before I go into each of them; namely, Clause 3(3), page 3, line 24,
"but if the plan is formulated on that assumption it shall be accompanied by particulars showing the benefits expected to accrue from the grants".
Then we have in Clause 3(4):
"The plan shall be accompanied by estimates of … (c) the benefits to potential users of those services and facilities".
Clause 4(2)(b) speaks of:
"estimates of the extent to which particular benefits, specified by the authority, would accrue to the public at large, or to any section of the public so specified".
How do these ideas compare with the White Paper?
The White Paper clearly intends "benefits" to be seen in the widest sense. It says wherever possible benefits should be specified, measured, and assessed. The words of paragraph 8 are:
"There must be general transport benefits such as"—
so these are only examples—
"the provision of services in areas or at times that could not otherwise support a viable public transport service; or the alleviation of road congestion through the attraction of drivers from their cars. Wherever possible, such benefits should be specified, measured and assessed".
Then, in paragraph 21 it says:
"in assessing value for money, account will be taken of the benefits to users of public transport and to other road users in terms of reduced congestion and accidents".
The White Paper doubts the possibility of measuring all the benefits of subsidies, and this is clearly true. That is why the Bill speaks of "estimates" and "benefits expected to accrue". However, there can be no doubt that the logic of Government thinking is to take the broadest possible view.
The wording of the Bill follows this wide interpretation with one exception. That is the limiting words—which this amendment seeks to remove—contained in Clause 3(4). In the Bill, the first reference to benefits is in Clause 3(3). The provision is enabling; it allows the executive to assume, when

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preparing its financial plans, that it will receive financial support.
The executive is then required—having made that assumption—to provide particulars of benefits expected to accrue from the grants made by the authority. It is clearly for the executive to decide what benefits can be foreseen—and there is no limitation whatsoever on the range of benefits to be taken into account. The initiative is with the executive and no-one—no court of law—could interpret this clause as implying any limitation on the benefits that may be taken into consideration.
Turning to Clause 4(2), we find that the authority may require estimates from the executive of benefits which
"would accrue to the public at large, or to any section of the public specified".
It is again difficult to conceive any potential benefit which would not be covered by this form of words. In contrast, Clause 3(4) specifically requires the executive to give "estimates"—which word presumably has the same meaning as "particulars of benefits expected to accrue"—"of the benefits to potential users".
It is those last three words which are totally unjustified in the context of the White Paper, and this part of the Bill taken as a whole. There is no logic in considering benefits to potential users only, when Clauses 3(3) and 4(2)—following the intentions of the White Paper—encompass "benefits" on the widest possible basis. It is true that, while the provisions of Clauses 3(3) and 4(2) are enabling, the circumstances they provide for are such that—in the real world—it is impossible to conceive they will not apply. All sides of the Committee—and all speakers in another place—have recognised that in this day and age at least some subsidy will be necessary for our bus services. Therefore, it is inevitable that these clauses will in practice be operative. It follows that it is pointless, and confusing, to limit the requirements in Clause 3(4) to benefits to potential users of services and facilities.
The word "potential", in this context, is not only ambiguous but confusing—and I should like to illustrate to the Committee why this is so. Recently, when I was discussing this amendment with two senior executives of different organisations—people of considerable experience in the industry and in public affairs—they came up with totally different interpretations of the word. So we have no clarity of meaning. The word "potential" is obviously something we have to clear up; and at the moment I can see no other way but to ask the Committee to leave it out because it is used in a context which distorts the general intentions of the legislation.
It must further be noted that it is only the limited form of benefit—to users—to which the authority must pay particular regard, under Clause 4(3). The word "particular" is not exclusive, but it places an unfortunate emphasis on a form of words—that is, "benefits to potential users"—which is at variance with the Government's avowed intentions. So, as at present worded, paragraph (c) of Clause 3(4) is a potential source of confusion, and misinterpretation, in any litigation which may arise, in the application of this proposed Act.
Unfortunately, litigation must surely be expected before the valuable provisions set before us have been sufficiently interpreted to allow the stability which is so vital to the bus industry. We must not confound confusion; the words "to potential users" should be left out. I consider the amendment to be very important. It is not political. It does not go against the spirit of the Bill. I hope, and believe, that it goes some way to clear elements of confusion. I beg to move.
Lord Bellwin: Let me first say that the Government entirely accept that wider considerations of the kind described by my noble friend ought to be—and indeed must be—taken into account when planning the provision of transport services. But our difficulty in accepting this amendment is that Clause 3(4) is concerned with the duty of the executive to submit precise estimates of those factors which are directly related to the services which they provide: their cost, the level of demand for them and the benefits which they produce. The wider considerations are different in kind from this and would be largely outside the control of the executive. We do not therefore believe that it would be appropriate to widen Clause 3(4).
I would remind the Committee, however, that under Clause 3(3) the executive is required, when submitting proposals for revenue support, to accompany them with particulars of the benefits expected to accrue from such support, as indeed my noble friend said. The reference to benefits in Clause 3(3) clearly includes consideration of the kind of factors aimed at in the amendment, in so far as it is within the power of the executive to take them into account. The authority can, under Clause 4(2)(b), ask the executive to estimate other specific benefits. My noble friend went into considerable detail and I want to read carefully what he said. I can make no commitment, as I am sure he knows. I hope that even the few remarks that I have made may reassure him that the wider considerations will be taken into account. But I do assure him that I shall want to read carefully what has been said and to see whether, despite what I have said, it is not covered, At the moment I cannot accept the amendment, for the reasons which he knows.
Lord Teviot: I thank my noble friend for what he has said. After the long deliberations we have had this afternoon, I will not delay your Lordships because I am sure you will want to go and eat dinner. I will read what my noble friend has said, just as he will read what I have said; and, in the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Lucas of Chilworth: Perhaps it would be for the convenience of the Committee if I suggested that we should now pause in our consideration of this Bill and adjourn for one hour for dinner, thus allowing the other business of the House to continue. If that meets with the agreement of the Committee, I beg to move that the House be now resumed.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Parliamentary Constituencies (Wales) Order 1983
7.2 p.m.
The Parliamentary Under-Secretary of State, Home Office (Lord Elton): My Lords, I beg to move, That the draft Parliamentary Constituencies (Wales) Order 1983, which was laid before this House on 7th February 1983, be approved. This order is intended to give effect to the final recommendations for new parliamentary constituencies contained in the Third Periodical Report of the Boundary Commission for Wales. Article 2 of the order substitutes the 38 constituencies described in the schedule for the present 36 constituencies in Wales. The draft order has already been approved in another place. It was considered by the Joint Committee on Statutory Instruments who had no comments. If it is approved by this House tonight the Home Secretary will submit it to Her Majesty in Council to be made. The order will come into operation on the fourteenth day after the day on which it is made but will not affect the existing boundaries until the first general election held thereafter.
The commission is required to conduct periodic reviews of all the Welsh constituencies at intervals of not less than 10 or more than 15 years from the date of the report on its last general review. It submitted its Second Periodical Report on 19th May 1969 and has taken just under two years to complete its latest review, which began on 23rd February 1981. During this period it has held local inquiries in every county and, following those inquiries, modified its original proposals to varying degrees in certain areas. Your Lordships will appreciate, therefore, that there has been a great deal of public consultation before the formulation of the commission's final recommendations, and one has only to read the report to apprecite the care which it has taken in conducting this review.
Such meticulous conduct is, of course, only what one would expect of a totally impartial body of this kind, which has Mr. Speaker as ex-officio chairman, a High Court judge appointed by the Lord Chancellor as deputy chairman and two members appointed by the Home Secretary and the Secretary of State for the Environment respectively. Moreover, following the assurance given in 1958 by the then Home Secretary, the late Lord Butler of Saffron Walden, the appointments of the deputy chairman and members have to be made in agreement with the other political parties. The aim is to ensure, so far as is possible with an issue as sensitive as that of constituency boundaries, that the commission itself is not the subject of party political controversy. In addition, of course, the commission is given guidelines for the conduct of its reviews. These are the rules set our in Schedule 2 to the House of Commons (Redistribution of Seats) Act 1949. Perhaps I may summarise them for your Lordships.
Rule 1 provides that there shall be no less than 35 seats in Wales. Rule 4 requires the commission to ensure, so far as is practicable, that no constituency crosses a county boundary. Rule 5 states that the electorate of any constituency shall be as near the electoral quota as is practicable, having regard to the
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preceding rules. Rule 5 also permits the commission to depart from Rule 4 if it considers a departure is desirable to avoid an excessive disparity between the electorate of any constituency and the electoral quota, or between the electorate thereof and that of neighbouring constituencies in Wales. Rule 6 allows the commission to depart from the strict application of Rules 4 and 5 if it considers that special geographical considerations, including the size, shape and accessibility of a constituency make such a departure desirable. Section 2(2) of the House of Commons (Redistribution of Seats) Act 1953 absolves the commission from the need to give full effect in all circumstances to all the rules in the Second Schedule to the 1949 Act, but requires them to take account, so far as they reasonably can, of the inconveniences attendant on alterations of constituencies, other than alterations made for the purposes of Rule 4 of those rules, and of any local ties which would be broken by such alterations.
The rules thus give the commission a wide discretion—essential if it is to carry out its duty of providing equal representation while preserving local ties. That task is particularly difficult in Wales, with its industrial valleys, its coastal resorts and its sparsely-populated mountain areas.
It is thus hardly surprising that the commision has not pleased everyone: that would have been impossible. But what I hope we can all agree on is that the commission made a very real effort, through its local inquiries and its consideration of representations, to find out local people's views and to take them into account. The difference between the commission's first recommendations and its final recommendations is clear evidence of that willingness to listen and learn. I am sure that your Lordships would wish to join me in expressing our thanks to the commission for their work and also to the assistant commissioners who held the local inquiries.
I turn now to the recommendations. The changes recommended by the commisssion are undoubtedly sweeping: well-known constituencies such as Denbigh and Abertillery would disappear, as would familiar names such as Flint and Anglesey. But the radical changes which had been made to local government areas in Wales since the last review made such changes to constituency boundaries inevitable. Nine of the existing constituencies crossed the new county boundaries at the start of the review, and movements in the population had created large disparities between the 1981 electorates of all 36 seats, which ranged from 27,619 in Merioneth to 85,273 in Monmouth. Although three of the present seats, Anglesey, Caernarvon and Montgomery, remain unchanged in area under the commission's proposals, the remainder have been altered to varying degrees, while two counties, Gwynedd and Powys, have each, in effect, been allocated one extra seat because of special geographical considerations in those areas. This brings the total number of recommended seats to 38, of which only five (as opposed to 21 at present) have electorates which deviate by more than 15 per cent. from the electoral quota—that is, the 1981 average electorate of 58,753. In the Government's view, the commission has been remarkably successful in the task which Parliament has imposed upon it, and, on

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the eve of St. David's Day, I therefore have great pleasure in commending the commission's final recommendations to your Lordships. I beg to move.
Moved, That the draft order laid before the House on 7th February be approved.—(Lord Elton.)
7.10 p.m.
Lord Cledwyn of Penrhos: My Lords, the noble Lord has introduced the order to us with his customary clarity and we are very grateful to him for that. He will be aware that there has been considerable interest in these proposals in Wales and there was an extended and, at times, acrimonious debate in the other place. This is unusual, if I may say so, in a Welsh debate; but it demonstrated the strength of feeling which exists in Wales on some of the proposals in the order.
The task of a Boundary Commission is not an enviable one, and I join the noble Lord in thanking them for the work which they have done. They must seek to act within the powers and terms of reference given them by statute, and they must also have regard to local susceptibilities and views. They are dealing with local communities and, as the noble Lord has reminded us, with boundaries which go back over the centuries. It is essential that the reactions of these communities should be respected. It is very sad—as the noble Lord remarked—that the names of the old counties and boroughs of Denbigh and Flint, which have been associated with constituencies since 1552, when an honourable Member for Calais sat on the Back-Benches in the other place, will under this order disappear for ever.
I take the view very strongly that mathematical precision should not be the first consideration of the commission as it sets about its work. There must obviously be some numerical consistency, but the so-called "numbers game" should not be the predominant consideration. I noted that the Court of Appeal, sitting recently, agreed that:
"… Parliament attached great importance to each MP representing more or less the same number of electors, this was not the only matter which Parliament had considered important … account must be taken of local ties and geographical considerations, such as size, shape and accessibility.
"Parliament had not told the Boundary Commission to do an exercise in accountancy—to count heads, divide the number and then draw a series of lines around the resulting groups.
"It had told the commission to engage in a far-reaching and sophisticated undertaking, involving striking a balance between many factors, and this called for judgments not scientific precision".
I think that the Court of Appeal got that just right.
The interpretation of Rule 5 of the second schedule to the House of Commons (Redistribution of Seats) Act 1949, which was referred to by the noble Lord, should therefore be looked at carefully. Perhaps I may quote at rather greater length than the noble Lord. It states:
"The electorate of any constituency shall be as near the electoral quota as is practicable having regard to the foregoing rules; and a Boundary Commission may depart from the strict application of the last foregoing rule if it appears to them that a departure is desirable to avoid an excessive disparity between the electorate of any constituency and the electoral quota".
What is "excessive disparity"?
There are cases where the very facts of geography compel the commission to disregard the electoral
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quota of 58,000. The obvious examples are the Western Isles, with an electorate of 22,393, Orkney and Shetland with 28,884 and Caithness and Sutherland with 29,564. Long distances, difficulties in communications and sparsity of population are factors which must be taken into account, and I do not think any reasonable person would gainsay that. It was sensible, therefore, for the commission, in its revised proposals, to leave the Isle of Anglesey as it is with a growing electorate of 47,726 and not, as was originally suggested, to add the mainland city of Bangor on to it, however worthy and dignified that city may be.
I am bound to say that I was taken aback when I studied the commission's first recommendations: the detaching of Aberfan from Merthyr Tydfil; the attachment of Llandudno to Merioneth and of Bangor to Anglesey, as well as a number of other anomalies, seemed to show an unusual lack of sensitivity at that early stage. The revised proposals are, in my view, a great improvement, although the way in which the county of Clwyd is reorganised has come in for some very harsh criticism from Mr. Geraint Morgan and Sir Anthony Meyer. The constituencies of Clwyd have been de-personalised. There is not much poetry in politics as it is, and this clinical carve-up of Clwyd makes it even more soulless. I am not sure that the changes should be tied so tightly to county boundaries as they are at present. Districts are more attuned to local feeling than the counties created by the 1972 Act.
The transfer of North Pembrokeshire to Ceredigion was also bitterly resented. I have had occasion to meet a number of councillors from the Preseli District Council over the last hour or so, and I can say that they conveyed a profound feeling of dismay that this part of North Pembroke is to be transferred to Ceredigion. The Preseli District Council put forward an alernative proposal, to the effect that there should be a tolerance of 20,000 in the electoral quota, on the grounds that to use the electorate as the sole criterion was to ignore great variations in the geographical and sociological features of Wales. They argued strongly that due account should be taken of special geographical considerations; namely, the size, shape and accessibility of the area. The peninsular nature of the former Pembrokeshire makes it a distinct geographical entity and any attempt to hive off parts of it to another parliamentary constituency would, they say, be a patently artificial device aimed at complying with the rules of the "numbers game".
Still on the question of geography, they say that the proposed Ceredigion constituency is already approximately 100 square miles greater in area than the present Pembroke constituency. The provisional recommendation would result in the transfer of an area of some 225 square miles from Pembroke to Cardigan and consequently exaggerate the disparity even further. These are powerful arguments for taking account of the objections which were made in the inquiry held in Haverford West on 6th and 7th January of last year. There, all the neighbouring district councils, as well as all the political parties and public bodies of any significance, objected to these proposals, but, sadly, they were not heeded. I hope that the noble Lord may have something helpful to say about this proposal when he comes to wind up this debate.

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There were, of course, further criticisms from other parts of South Wales. A number of honourable Members in another place, including Mr. Ray Powell, Mr. Donald Coleman, Mr. Roy Hughes, Dr. Roger Thomas and my right honourable friend Mr. John Morris had some very harsh things to say. My right honourable friend raised a substantial point of order regarding the Neath (Communities) Order 1982: whether the Home Secretary was, in fact, modifying the commission's proposals and, if so, whether he intended to make a statement of the reasons for modification. He asked that the matter be referred to the Attorney-General.
I note that in the debate on 21st February in another place Mr. Patrick Mayhew, the Minister of State, said that he had consulted the Solicitor-General in the absence of the Attorney-General abroad, and that,
"having considered the arguments, his view is that the draft constituencies order does not effect a modification of the recommendations of the Boundary Commission for Wales contained in its report." [Official Report, Commons; col. 769.]
I shall be grateful if the noble Lord will confirm that, on mature reflection, that remains the Government's view. I read the report of the exchange in another place very carefully, and it seemed to me that my right honourable friend was raising a point of considerable substance and that he deserves a considered reply.
Another question at issue is whether the procedures as they stand are entirely satisfactory. I would not wish to interfere with the commission in the sense of its impartiality, independence and detachment from the Government, and on this I agree entirely with what the noble Lord said in his opening speech. Many of the draft proposals of July, 1981, may not have been sensible, but I believe that they were made in good faith. Furthermore, I think that the public inquiries which followed the initial proposals were, on the whole, of great value. It is reassuring to know that, with the exception of the objections made at the public inquiry at Haverford West in January, they were, in fact, heeded.
But it is when we come to Parliament itself that we must question the total efficacy of the procedure. As the noble Lord is aware, the order goes to the Joint Committee on Statutory Instruments, which comprises Members of both Houses, so we in this House are represented on that committee. Then it goes to the other place. Although amendments may be tabled, they are never selected for debate and the order cannot be amended by Parliament. On the other hand, the Secretary of State may, as the House is aware, authorise amendments, if he sees fit. This seems to me to be an unnecessarily complex exercise which can cause problems. It behoves every Government to do all that is possible to meet reasonable criticism, because in this order and the others to follow we are dealing with the raw material of democracy. We must be careful to ensure that it is as right and fair as possible.
Nevertheless, having made those comments and criticisms, let me say that on the whole we welcome the final report. We particularly welcome the fact that Wales is to have two additional Members of Parliament. This can only have the effect of enriching debates in another place.
7.21 p.m.
Lord Lloyd of Kilgerran: My Lords, may I express our gratitude to the noble Lord, Lord Elton, for the fair way in which he introduced the order. I join the noble Lord and the noble Lord, Lord Cledwyn of Penrhos, in thanking the commission for the great amount of work they have done in carrying out this very difficult task. Like the noble Lord, Lord Elton, I, too, must congratulate the noble Lord, Lord Cledwyn of Penrhos, on the fact that Anglesey has been saved from being joined with the mainland. It is, however, with the greatest humility that I follow the noble Lord, Lord Cledwyn. I had the privilege of standing against him in a general election in Anglesey, and I remember that my election agent had the temerity to organise very large meetings outside his offices in Holyhead. Nevertheless, I console myself with the fact that although I did such an outrageous thing I did not lose my deposit in my campaign against the noble Lord, Lord Cledwyn of Penrhos, as he now is.
During the debate in the other place many Members of Parliament for Wales severely criticised the proposals. One Member of Parliament referred to the proposals as grotesque and out of balance so far as the geographical areas are concerned. I do not propose to follow the noble Lord, Lord Cledwyn, in criticising the arrangements recommended by the commission. For voting purposes, there is a great deal to be said for having constituencies of the order of 58,000 or 59,000. I join the noble Lord, Lord Cledwyn, in saying that all Welshmen will applaud the fact that the commission proposes to increase the number of Members of Parliament for Wales by two, thus giving Wales a little more voice in Parliament in the affairs of the United Kingdom.
The noble Lord, Lord Cledwyn, said that there is no poetry in these changes. From a personal point of view, however, I am delighted that the little village of Kilgerran, with its great castle, and the great town of Cardigan, together with the small village of Llanwenog, where my mother was born and where I spent a great deal of time, have at last been joined together in one constituency. Despite the geographical difficulties, on purely Welsh cultural grounds there is something to be said for joining up the two. I understand that this arrangement has been accepted by the Secretary of State for Wales who is a Member of Parliament for the present constituency of Pembrokeshire. I feel like congratulating him on the sacrifice which he seems to have made on this occasion.
The commission's report refers to the desirability of fairness in relation to general elections. In conclusion, I cannot resist saying that if the Government are thinking of political fairness for Wales in general elections, this can only be achieved once the procedures for general elections have been changed and some form of proportional representation introduced.
7.25 p.m.
Baroness White: My Lords, perhaps I might add just a sentence or two, in the absence of any member of the Social Democratic Party wishing to take part in the debate—which is perhaps significant. It would be appropriate for a valedictory word to be said for the

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Flint constituencies. I had the honour to represent East Flint for 20 years, but my first apprenticeship in the electoral scene was in 1945, when Flintshire was a single constituency with no fewer than 105,000 electors. In my innocence in those days I had not realised that any constituency of that size, when the norm was about 50,000, was bound to be divided into East and West. It was only later that I appreciated my good fortune.
I am delighted that Wales as a whole is to have two extra seats and that Clwyd, which now embraces both Flint and the former Denbighshire, is to have one of them. I am entirely at one with my noble friend Lord Cledwyn that Clwyd North West and Clwyd South West do not trip off the Welsh tongue at all easily. It will not sound any better in Welsh, I am afraid. It seems to me that a little greater imagination might have been used and that a greater excursion into Welsh history could perhaps have provided an appropriate nomenclature which would have sounded well in both languages. One name could have done for both. However, that is not to be. I appreciate that times have changed and that the ancient county of Flint is, electorally, now to disappear.
I must also admit to a personal feeling of regret that another very well known constituency has vanished in the proposals for Gwent. I congratulate my noble friend Lord Cledwyn on the identity of Ynys Môn having been entirely preserved, and I am sure that my noble friend Lord Elwyn-Jones will be equally delighted that Llanelli has not been tampered with. But the famous constituency of Ebbw Vale has now vanished, so it appears. That was Anuerin Bevan's bastion. The part of Gwent with which my family is connected, Rhymney, was part of that constituency. It will be subsumed in one of the other Gwent constituencies, but one might note in passing that another famous name has been erased from the political map. Then Ceredigion and Pembroke North. Naturally the noble Lord, Lord Lloyd of Kilgerran, can feel somewhat gratified, but I am not entirely convinced that what is Pembrokeshire's loss is Ceredigion's gain. Cardiganshire, from which my grandfather came, is a proud county. It has its peculiar characteristics, very well-known in Welsh society. It is the equivalent in Wales to Aberdeen in Scotland. People are careful in Ceredigion. We are not quite sure what they are like in Pembrokeshire, so I am not sure that this particular change will be greeted with unalloyed satisfaction.
Nevertheless, I join my noble friend in saying that the commission was faced with an impossible job and that on the whole it seems to have made as fair a job of it as one could reasonably expect. It is a pity that the commission showed a little less imagination about the names of some of their new creations, but I think we can forgive them in that they decided that we should have two extra seats.
7.30 p.m.
Lord Elton: My Lords, by your Lordships' leave, I shall respond to this happily less acrimonious debate than that which the noble Lord, Lord Cledwyn, referred to in another place. The noble Lord said that there was no music in politics. I must say that it was a delight to hear him recapitulating the names of so
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many constituencies in a tone which I am afraid I cannot follow. Wales has always seemed to me to be the heart of music in our nation and I always value my visits there for that reason, if for no other.
The noble Lord, Lord Cledwyn of Penrhos, raised a number of points—one of which was the transfer of parts of North Pembrokeshire to Ceredigion, in which he saw something approaching an injustice, although he was good enough to say that the Boundary Commission had remarkably well filled the task of impartiality placed upon it. In view of his approval on that, I can do no better than to quote paragraph 71 of the Report of the Boundary Commission for Wales. I shall read it in English, which I can do, but I am glad to note that it is published also in Welsh, which I cannot read. It states:
"We noted that two representations referred to our recommendations elsewhere in the principality to argue that we had breached the rules. This we categorically reject. While we recognise the strength of feeling against our recommendations in North Preseli, we found that none of the representations raised fresh evidence or gave due weight to the fact that the electorate of the Pembroke constituency would be nearly 80,000 if we acceded to the objection. We remained adamant in our view that this would be unacceptably high and concluded that our revised recommendations should not be altered".
The noble Lord, quite properly, then said that this became a question, did it not, of how far one could deviate from the norm of about 58,000? I cannot argue every case and therefore I ought not to argue any case for the commission. I can only adduce the reasons for which they have given them.
The noble Lord also referred in passing to the frustration which procedures on this sort of order produce among those who would like to amend them and are denied the chance. This order is not peculiar in that matter. Any Order in Council is not susceptible to amendment. It can only be either accepted or rejected. If it were otherwise, with an order of this sort, the acrimony to which the noble Lord referred earlier would still be continuing. On matters of this sensitivity it is probably right to have an impartial body getting near to exactly a fair decision and then to abide by it, but with the opportunity to comment as it goes through.
The noble Lord referred also to undertakings given in another place about the effects of the order, and I can repeat in this House an assurance given by my honourable and learned friend the Minister of State in another place on the question of whether the draft order now before this House effects any modification to the commission's recommendations. My honourable and learned friend consulted my right honourable and learned friend the Solicitor-General, who authorised him to say that, having considered the arguments put forward, he expressed the view that the draft constituencies order did not effect a modification of the recommendations of the Boundary Commission contained in its report. After mature reflection, that is still the situation.
I am tempted to try to test the musicality of North and South in Welsh as in English, but although my accent is occasionally just passable, my orography is hopeless, and I could not get it from the paper which the noble and learned Lord opposite so kindly sent to me. I will, however, say how glad I was to hear that the great castle of Kilgerran is in a situation which the noble Lord, Lord Lloyd of Kilgerran, finds

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satisfactory; and I must thank the noble Baroness, Lady White, for her contributions, all of which have illuminated this debate.
We do not normally have contentious arguments here, and least of all on Welsh matters. Had it been otherwise, and had we reached that sort of pitch of enthusiasm in this House, I should have been tempted at the end of the proceedings to use a phrase which I had mastered for use in the Third Reading of the Wales Bill during the devolution debate. Unfortunately, though, I was in Bangkok at the time and nobody there spoke Welsh that I could discover. It is, I believe, correctly interpreted as Diolch i dduw; dyna'r Diwedd—which means, "Thank God that's over!" I have wearied your Lordships too long; your Lordships have not had your dinner. I should like to say that on the eve of St. David's Day I and the Government wish the Principality of Wales well in its new representation under rules which have been carefully and fairly made out, and which give that beautiful Principality two extra Members of Parliament.
On Question, Motion agreed to.
Lord Glenarthur: My Lords, I beg to move that the House do now adjourn during pleasure until eight o'clock.
Moved accordingly, and, on Question, Motion agreed to.
[The Sitting was suspended from 7.35 p.m. until 8 p.m.]

Transport Bill
House again in Committee, on Clause 3.
Lord Underhill Lord Underhill moved Amendment No. 18:
Page 3, line 34, at end insert ("and
(d) the broad economic, social and environmental benefits derived which are not limited to public transport users").
The noble Lord said: It will be noted that the words of this amendment are somewhat the same as the words of a previous amendment, but this is in a different context. Whereas the previous amendment referred to the "social, economic and environmental transport advantages", this refers to "the broad economic, social and environmental benefits derived which are not limited to public transport users". One can think of these as the benefits and advantages which they give to persons who are not necessarily users of transport: the possible relief of congestion and the assistance given to shops, to which I referred earlier; although that seemed to be dismissed by the Minister, it is a very important point. Emphasis has been laid on the question of rating values. The Liverpool shops' committee pointed out that they are also affected by rates and if they are doing no business because people cannot afford to travel in obviously they are at a great disadvantage. Therefore it affects shops. It affects those people who are going to entertainments or sports and so on. Therefore, there are quite a number of people who are not necessarily transport users but who can be affected by the economic, social and environmental aspects of passenger transport.
Without repeating all the previous arguments, may I refer to a letter sent by the Chartered Institute of Transport to the Secretary of State—the Minister will be well aware of this—dated 18th January, which has some relevance to this particular amendment. If I may read an extract from page 2 of the letter, they say:
"We assume it is still your intention that authorities should determine public transport expenditure in the wider context of overall needs and of their statutory duties to prepare and implement comprehensive transportation plans."
They go on to say:
"Our anxieties about this narrowness of the approach are increased by the way in which benefits of subsidy are handled in the Bill."
They draw attention to the need for amendments to Clause 3(1) and Clause 4(1). The letter continues:
"An example that occurs to us is that the Government's policy of reviving decaying central areas could well be assisted by reduced fare levels. At the same time many aspects of social benefits can be measured. For example, road accidents, traffic congestion, fuel and time savings, etc. But in describing the contents of the plan in the Bill, Clause 3(4)(c) only asks for estimates of the benefits to potential users. This seems in conflict not only with the White Paper but also with the broader wording at the end of Clause 3(3)."
It would appear that the Chartered Institute of Transport fully agree with the terms of this amendment, and therefore, without going into all the arguments produced on the previous amendment, I beg to move Amendment No. 18.
Lord Northfield: May I intervene for one brief moment to say this? One of the worries I have is that nowhere in this Bill are the problems of the general effects on the environment adequately dealt with. The Council of Europe Assembly, of which I am a Member, has just passed a recommendation to Ministers, backing up a recommendation of the EEC Commission in Brussels, that we should now press all Governments, at every point we can, to enforce in policy-making of all kinds, right on the ground floor from the very beginning, that environmental considerations shall be taken into account. Too often, especially in transport, the problem has been that the environmental damage occurs—in this case my noble friend is talking about environmental benefits of switching from cars to buses—but the whole problem of benefits and disbenefits has been that the environmental disadvantages occur and we then rush in with fire-fighting (not in the literal sense) activities to try to stop it being at its worst.
For example, in the case of public goods transport, to which I will refer in parenthesis, a very good study by Mr. Nigel Haig, who is known to many people in this Chamber, estimates that if you take the very large truck and project the growth in usage to the end of the century, on a low growth economy hypothesis we are going to get a 53 per cent. increase, and on a high growth we are going to get a 71 per cent. increase. This is absolutely frightening. This does not mean to say that I am against liberalisation of goods transport policy, but it does point to the fact that, as in transport generally, we have to start bringing in environmental considerations at every point we can. I suggest to the noble Lord that if he cannot accept this amendment he ought to tell us this: when these plans are prepared by an authority, where is it going to be enforced on them that environmental considerations must be brought in, whether they are the benefits to which my noble friend

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refers or disadvantages of the kind to which I am referring? We all know that the GLC at the moment is looking into the whole problem of stopping large trucks in London. The pressure is growing all the time, and we really must insist that the kind of thing we are talking about is brought into this part of the Bill.
Lord Bellwin: I am interested in what the noble Lord, Lord Northfield, has said. May I think about that and see what the current thinking is on the point he makes? I will certainly do that, and of course I will get in touch with him, as he knows I always do. As to the amendment, let me first say that the Government entirely accept that the factors of the kind outlined by the noble Lord, Lord Underhill, ought to be and must be taken into account when planning the provision of transport services. Our difficulty in accepting the amendment is that Clause 3(4) is concerned with the duty of the executive to submit precise estimates of those factors which are directly related to the services which they provide, the cost, level of demand and the benefits they produce. The wider considerations listed in the amendment are different in kind from this and would be largely outside the control of the executive. We do not, therefore, believe it would be appropriate to insert a reference to them in Clause 3(4).
May I remind your Lordships that under Clause 3(3) the executive, when submitting proposals for revenue support, is required to accompany them with particulars of the benefits expected to accrue from such support. It is certainly our intention that these particulars should include consideration of the kind of factors listed in the amendment in so far as it is within the power of the executive to take them into account. In addition the authority can call for estimates of benefits under Clause 4(2)(b). For these reasons, without going into the matter in great detail—and I hope the noble Lord, Lord Underhill, will agree with me—we cannot accept the amendment. I think he will follow the point I am trying to make.
Lord Underhill: The Minister really has said two important things; the first, is that to add these points would be to include matters which are outside the control of the executive. That is one of our complaints about the Secretary of State dealing with the executive. He also said that he would take certain things into account as far as the executive may do so, or words to that effect. Again, that was one of the complaints in the previous group of amendments; that it is the executive that is being asked to supply these various items.
The amendment is related, of course, to Clause 3(4) where,
"The plan shall be accompanied by estimates of" —
then (a), (b) and (c) are listed. If the Minister says that it is commonsense that the economic, social and environmental benefits should also be considered in the plan, surely there should be some estimate of what benefits will be secured when the plan has been submitted. That is why we are asking for an additional paragraph, paragraph (d), to be added to (a), (b) and (c) in subsection (4). I have noted what the Minister has said. I hope he will do as he said he would; that is, pay the most careful attention to my noble friend Lord
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Northfield. If he will also look at this whole question of the economic, social and environmental benefits which were brought up on the previous amendment, that would be useful. On that basis I beg leave to withdraw.
Amendment, by leave, withdrawn.
The Deputy Chairman of Committees (Earl Cathcart): In calling Amendment No. 19, I should point out that if that amendment is agreed I cannot call Amendment No. 20.
8.12 p.m.
Lord Underhill Lord Underhill moved Amendment No. 19:
Page 3, line 35, leave out subsection (5).
The noble Lord said: For the benefit of the Chair, I shall not be moving Amendment No. 20 as that was covered by the first group of 19 amendments. This is a second group of amendments. In case your Lordships think we are going over completely the same ground, it is rather different because we are proposing here the deletion of some subsections. Although the discussion on the previous group of 19 amendments roamed fairly wide, even, as we said, almost to a Second Reading debate, we were only debating amendments which dealt with the desirability of the plan to be prepared jointly. That was all that the group of 19 amendments was concerned with.
We are going a little further in this amendment. It deals with the question of the relationships of the PTEs with the executive and the proper relationships of the PTE with its public transport authority. Concern has been expressed by the body to which I have already referred on the previous amendments, the Chartered Institute of Transport, because in that same letter to the Secretary of State, as recently as 18th January, just over a month ago, in the penultimate paragraph they said:
"Our final point concerns the position of professional transport people, particularly the Members/Directors of the Executives within the statutory processes envisaged in the Bill".
The letter goes on to say:
"In this context the direct links envisaged in the Bill between the Executives and the Secretary of State in various aspects of these procedures could well bring Executives into conflict with their Authorities".
That is the Chartered Institute of Transport saying that, not Lord Underhill on behalf of the Opposition. The letter continues:
"This would not only initiate against the effectiveness of public transport but would also frustrate the successful operation of the system set out in the Bill and even the provisions of the 1968 and 1969 Acts".
We have that very effective and influential body, the Chartered Institute of Transport, saying, in far better language, what I want to say in justification of these amendments. So that the Committee will know precisely what is proposed in the amendments, it proposes the deletion of Clause 3(5). That was the section in which, as we explained previously, the executive has to take into account the advice under various subjects given by the Secretary of State. We also propose leaving out Clause 4(6). That again is where guidance will be given by the Secretary of State under Clause 4(5), on three particular points that are listed there.
We also propose the deletion of lines in Clause 6(2) and (3). All these relate to matters which we dealt with on the previous group of amendments; that is, the request to the executive for information, the supply of the information to the Secretary of State and those kindred matters which we dealt with last time, which I will not go over again except to explain that on the previous occasion we did not move these particular deletions. We dealt just with the question of the joint plan. Now, in order to safeguard the position of the executive with its authority, in order to safeguard the constitutional position of the authority with the Secretary of State, we propose these amendments, with the full influential support of the Chartered Institute of Transport. I beg to move.
Lord Bellwin: This group of amendments seeks to remove the role of the Secretary of State in the planning process and his initial advice on the preparation of plans and final guidance on the appropriate levels of the revenue support. I do not believe that they are in the best interests of the executives or the authorities. The main purpose of the Secretary of State's initial advice and final guidance figures is to inform the planning process which leads on to the time when the authority decides on its plan and on the level of subsidy, knowing that subsidy up to the Secretary of State's guidance is protected from legal challenge. That surely is a good thing. If authorities keep within that guidance they would be able to provide transport services in a stable atmosphere and protected from challenge.
I cannot emphasise too strongly that the Secretary of State's guidance is no more than that, guidance as to what he considers to be an appropriate level of revenue support. If authorities disagree—and I believe they can in all the circumstances justifiably do so—they are perfectly free to provide revenue support over and above that guidance. To remove the protection provided by the guidance in Clause 5(2) and to limit the Secretary of State's guidance to the general principles on which grants should be based, as the amendments would do, cannot be in the best interests of the authorities. We would be back to the position where any level of revenue support is liable to challenge and the law would be as uncertain as it is today. Challenge would be more likely, given the intentions of authorities to increase revenue support next year.
It is also quite right and proper that the Secretary of State should be able to provide advice to the executives as to the form and content of the plan. If the Secretary of State is to be able, after considering the plan, to provide guidance as to the appropriate level of revenue support, it is sensible that he should at least give advice as to certain matters which he considers the plans should take account of. This will ensure that the executives provide their plans on a common basis and with certain common facts. It is also important that advice to the executives should be copied to the authorities, not least because the authority itself has to take account of this in considering the draft plan.
In removing the executive and the authority's obligation to take the Secretary of State's initial advice and final guidance into account will remove their obligation to take note of the level of expenditure
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which the Government are prepared to protect from legal challenge, and would remove that protection. The Secretary of State's role in this planning process is not one of direction or dictation, but one of giving advice and guidance. Authorities will remain finally responsible for the levels of fares and services and for getting value for money from the subsidy and services to be provided. This is why we cannot accept the amendments.
The debate earlier went, and no doubt before the Bill is finished will come back again, to the supposed attack on local democracy. A quarter of a million pounds, £½ million—more money, astonishing, is it not?—has been spent on campaigns to try to create an atmosphere, to try to create opposition to the Bill and, in my view, it really is totally misguided. The fact is, as I said when we were speaking on Second Reading—I do not want to go into a Second Reading speech—that it is important on this group of amendments to say again that this whole situation comes about simply because we have reached a stage where there is an imbalance. There is an imbalance in fairness to all concerned. As I said before, it was always a maxim of local government that one represents all the people, the minorities as well as the majorities, and all the interests. We must not go to such extremes as we have seen in so many local authorities, where there is an excess of subsidy, and reach the point, as in South Yorkshire, where since 1975–76 there has not been a penny increase in the fares and the subsidy next year will be about £70 million.
There is not just an impact upon the ratepayers, bad though I think that is, but it takes away from the other districts within the county the opportunity for them to decide what level of support they want to give to different services. When the precept is so high it takes away the freedom for them to decide. How can we talk about a tax on democracy when here we have a situation which has gone to such extremes as to become ludicrous? Who is to protect not just the ratepayers and taxpayers but the minorities and to give back to local government a freedom which it is itself giving up in this way?
I do not want to go on because I do not want to get into a Second Reading speech, but we are at fundamentals here. I have said all along, and your Lordships know, that I have a feeling for those who are genuinely worried about this. In turn, I ask them to respect that I, too, believe very deeply that what has been happening is very wrong and that it is time to reach a sensible basis where, if the authorities decide at the end of the day that they have to do something, then so be it. But the Secretary of State will have set the level which will protect them up to that point and beyond that they are on their own. I think that is not unreasonable.
Lord Sefton of Garston: I do not want to go into a Second Reading speech, either, but if an amendment conflicts with something said from the Government Front Bench on Second Reading, then it is right to examine that amendment.
I made the point on Second Reading that I considered that the way the plan was to be operated would not comply with the Government taking local factors into consideration. I was discounted by the

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noble Lord sitting opposite, who said that the Government would give consideration to local factors. Here we have a situation where the guidance is to be given by the Ministry before the local authority even sees the plan. While the executive is drawing up the plan—I begin to think that the Government Front Bench has not read the Bill—the Ministry will give guidance. At that stage the local authority will not be considering it. The local authority will consider it after the initial plan has been drawn up between the Ministry and the executive.
How on earth can the Ministry give consideration to the points that the elected members wish to raise if the elected members have not even had the opportunity to put those points forward at that stage? The situation will be that we will have faces set and the whole of the Ministry will be behind the Minister, telling him, "Don't give way. We decided this with the executive committee". That is a negation of democracy and proves the point made on Second Reading that the Bill emasculates local government.
Lord McIntosh of Haringey: I thought that the Minister made a most extraordinary speech, and some of its extraordinary nature has been brought out by my noble friend. We are finding ourselves fighting cotton wool in this debate. Every time that we say that the Secretary of State—central Government—is interfering too closely in the affairs of the executive and in the plan prepared by the executive, the Minister says, "Don't worry, this is a matter for the authority in the end to decide." Every time we ask, "On what principles and on what basis is the Secretary of State or local government intervening in the planning process?" the Government say, "Don't worry, we will make up our minds as time goes on on what those principles will be". Meantime, the Government say they will oppose any attempt from this side of the Committee to introduce into legislation the principles on which they will intervene.
Therefore, we ask: on what basis can an executive or an authority have any idea of what is in the mind of Government other than the most detailed pernickety interference, as the planning model says, in the disaggregated analysis of different services? That is exactly the level at which central Government ought not to be involved. Central Government ought to be involved at the level, let us admit it, first of saying that beyond a certain point central Government subsidy will go no further. But that is not the point of this Bill, because the Bill is not about central Government subsidy. Secondly, the Government ought to be saying that in the national interest this is the kind of public transport service in the country as a whole, not just in the metropolitan counties, that the country can afford in the present economic circumstances.
On neither of those points do the Government give any idea of their thinking or any idea of what they expect from authorities or executives. They give no idea of the development, over a period of years, of better public transport systems to serve the public of this country. Instead, the Government are taking the classic course of saying, "We are concerned with the detail. We are concerned with route 31A after nine o'clock at night". That is literally the kind of thing we
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shall get into if we accept the Bill unamended. Every attempt that we make to try and winkle out of the Government some set of principles about public transport is wafted away in a maze of friendly words from the Minister which do not mean anything.
Lord Bellwin: The noble Lord may say what he says, and I say what I say. The fact is that we are being pressed to try to keep matters broad and not to pin things down. Then the noble Lord says, "No, what we want is chapter and verse, written in every move you make, so that you specify exactly what will be the list of criteria, and so on". He will not get that at all from me. The noble Lord should look carefully at the Bill. We had a long debate earlier when there was a difference on form and procedures, and there is still a difference about that and the understanding of it. But the one thing we will not do is try to give chapter and verse for the kind of criteria. It would make no sense to do so.
The fact is that there will be guidance and submission of the plans. The guidance will go back and it will then be up to the authority to decide what it wants to do. The noble Lord may call it cotton wool or what he likes, but as far as I am concerned that is the proper and reasonable way to go about it. My points about local democracy are absolutely valid, but I do not want to elaborate because there have been debates lasting for an hour or two already and I do not want to go into this again unless pressed. However, they are important. As I said, there are concerns that are deeply held by noble Lords opposite and which I respect. Equally, I expect them to respect the fact that I do not agree with them.
Lord Pitt of Hampstead: I know that the Minister does not have a closed mind and will, therefore, listen to the points that I put to him. The scenario we have at the moment is that under this Bill the transport executive, in consultation with the Ministry, prepares a plan which the authority sees and then considers. The authority also receives advice from the Minister. It is at that stage that the plan is finally decided by the authority and goes to the Ministry. I think I am right. But, in view of the fact that the Minister has himself admitted that many of the considerations which are necessary to draw up a proper plan are not things that the executive can in fact consider, or is competent to consider, would it not be better for the scenario to be the other way round? The Government and the authority could discuss the matter first and the authority then give instructions to the transport executive, so that the executive prepares a plan under the direction of the authority and that plan is eventually agreed upon and submitted to the Ministry. Would that not be a better scenario?
Lord Bellwin: The problem with that scenario would be that the authority would have no indication of the Government's thinking, which is what they would need to have. When the debate took place earlier I wrote down a few comments. I did not speak then because my noble friend was dealing with the matter. But I very carefully wrote down a few lines as to the exact route, if I can call it that, of how it proceeds, The plan is prepared by the executive after

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consultation with the authority and after receiving advice from the Secretary of State under Clause (5). The executive prepares the plan, which routes via the authority which can then modify it. It then goes to the Secretary of State after it has been modified, if the authority so wish. After the Secretary of State gives his PEL, the authority decides whether to keep within it or not. That is the batting order; that is the way it goes.
I should have thought that all along the line there is opportunity for the authority to make sure that it is stepping in and having its say. I pick up the point made by the noble Lord, Lord Sefton, about the local situation. I am anxious that that should be part of the whole procedure in reaching a conclusion. I do not think that that is too different from what the noble Lord, Lord Pitt, really wants. I wonder whether we are really understanding each other as to the way in which it would work.
8.33 p.m.
Lord Mishcon: I wonder whether at this stage I can intervene usefully, or, if not usefully, then at least briefly? I could understand the Minister—I would not necessarily agree with him—saying that he has (and certainly it is in accordance with his tradition) a respect for the autonomy of local government, if I could find somewhere in the Bill a clause which provided that before the plan finally went to the local authority for its endorsement, it should go both to the Minister—the Secretary of State—and to the local authority, and it should be the duty of the executive to take into account the advice of the Minister and also the advice of the authority. If one saw that in the Bill one would say that at least the Minister was making a fair point. He is making the point that these are only guidelines; that the executive need not follow them; and that, after all, it is not the end of the day because it is the authority that has the last word. We know in fact what that means: it means that they have the last word provided they are prepared to run a risk, and a very severe risk, if they decide that their word dictates that the transport needs are going to go above the limit.
If we want to try to keep a balance at least between local government and national Government, the words here in this, to me, invidious subsection (5) are a compulsion. At the stage before the authority endorses there is an injunction—it is not permissive—that the executive shall take into account the advice of the Secretary of State. If that means—and I repeat it—purely something harmless, that it is just a benevolent Secretary of State who says to the executive, "Come, come!; this is the guidance I would respectfully give you, throw it out of the window if you feel that it is impertinent or not relevant to your local needs, but accept it if you feel that it is relevant"—if that is all it means, what defence has the Minister to the question that I ask in criticism? Indeed, that is why I use the word "defence". The question is this: Why is there not a clause here which says that the executive, before preparing the final plan to be put to the authority for its final view, is to take the advice not only of the Secretary of State but also of the authority in regard to what are the needs and what are the policies? The only answer can be that the Government have the courage to go so far as to emasculate the rights of authorities
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but have not got the courage to go before the country and take transport away from local government completely. That is really the challenge.
If the noble Lord the Minister thinks that I am making a party point and an exaggerated one, I commend him—as I tried to do on Second Reading—to the leading article in, of all papers, the Economist, which criticises the Government for lambasting and curtailing the rights of authorities without having the courage, having regard to the way in which authorities are behaving, to take transport from the local authority aegis. To do that and to say that it is the Secretary of State alone who gives advice at that preliminary stage and the executive has to take this into account, without at least having a parallel of right to the authority to give advice and the executive to be asked to take it into account, shows, with respect, the insincerity of the Government in trying to give that answer to this amendment.
Lord Bellwin: I just do not see it that way at all. The fact is that the authority does not just endorse the plan; it considers it and it decides upon it. The fact is that the Bill requires the executive to consult the authority before making its plan. This is really a continuation of the discussion that we had previously—
Lord Mishcon: I interrupt the Minister, if he will forgive me, for the following reason. I beg of him to deal with the point. If we are merely talking about guidance and consultation, why is there not a clause in the Bill which does not just talk about "consult with the local authority" but uses the words, "shall take into account the advice of the authority" in the same way as the executive has to take into account the advice of the Secretary of State? If "consult" equals "take into account the advice" can we have the same words used for the authority and for the Secretary of State, because then at least we shall know that there is honesty so far as the Government are concerned?
Lord Bellwin: Clearly, we are not going to agree on this. I did not respond to the noble Lord, Lord Pitt, on the same point when he said that the executive prepares its plan in consultation with the Ministry. That of course is not the case at all. There is no provision for consultation with the Ministry, only for advice from the Secretary of State. But there is a requirement for consultation with the authority. That is the key point which I keep coming back to all the time. Clearly, we just do not agree.
Lord Mishcon: I am not going to let the Minister off the hook, if he will forgive me for saying so. If I am bidden by the Minister in a letter to consult with the Minister, he knows as well as I do that that means that I express my view, he expresses his, and I can come to any conclusion that I like. If I have a letter from the Minister telling me that, under an Act of Parliament, I shall have to take into account his advice, he knows as well as I do that that goes beyond consulting because I am bidden to take into account his advice before I come to my decision. There is a world of difference between the two. Any judge on a judicial review will recognise the difference between the two. Indeed, it does not take a judge; it takes a person of ordinary common sense who knows common English to see the difference between the two.
Lord Bellwin: The fact is that if the authority decides that it does not want to take the advice, it does not have to; but if it does not—and we come to the point that is being lost here—then it has to realise that it leaves itself open to legal challenge. Up to the point that it takes guidance on the levels of subsidy, then it is absolutely protected in a way in which it is not protected today. That surely is critical. That is one of the absolute tenets of the whole Bill—that there is protection up to a point if this advice is taken, but if the authority decides not to take the advice, so be it. At the end of the day the final decision lays with the authority. They are the people who have to decide it.
Lord Underhill: First, I have an apology to make to the Committee, because in moving the first amendment I then detailed all the other items which were to be left out by other amendments but I did not give the numbers of those amendments. For the sake of the record, I had better give the numbers. In addition to moving Amendment No. 19, I have spoken to Amendments Nos. 34, 42, 44 and 47, and I believe that other noble Lords have spoken to those amendments in making their observations.
I am almost tempted to join in the first part of the Minister's reply, which was a Second Reading speech, because I have not given a Second Reading speech the whole evening. There has been continual reference as to why the Bill? Up to this stage we have not challenged the principle of the Bill, although we may do later on. We have been trying to introduce amendments to improve the Bill in the way in which it will handle the whole process. When the noble Lord referred to South Yorkshire and other authorities, I could make the easy reply that these people went through the democratic process of going to their electors with what they had done, asked for approval and received it at the subsequent election. The electors have approved the policy South Yorkshire have been following.
The Minister keeps saying that the authority has the final responsibility. I think that my noble friend Lord Mishcon has endeavoured to say, "Yes, that is so, but", and reference must be made to the first subsection that we wish to delete, subsection (5) of Clause 3, although I do not want to read it to the Committee. It is quite clear that the executive must take into account advice given by the Secretary of State; first, as to the amounts of revenue grant; then advice on the method of determining the benefits that will arise, and generally as to the form and contents of the plan. That means details—real details—of transport services on which the Secretary of State can give advice, and the executive must take this into account. So the subsection continues in that language.
But what has been overlooked is a subsequent provision—to which I referred in a previous amendment—that when the authority comes to consider whether it is to approve the plan, it must take into account the advice which was given to the executive. So, again, we get the situation that the authority is free, provided that it does what the Secretary of State has advised the executive. It is this direct link-up with the executive about which we are complaining and why the Minister must have this direct contact with the passenger transport executive
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and not the authority. In all the replies that we have had there has been no explanation as to why. I repeat, why does the Minister want to go to the executive and give this advice, which it must take into account and which subsequently the authority must take into account? It is this about which we are complaining. We can talk as much as we like about the authority having the last word, but it is subsection (5) to which we take the gravest exception, which the PTEs do not like either and which, as I have already said, the Chartered Institute of Transport dislikes as well.
At this hour it would be unwise to divide the Committee. The Minister knows that I respect his views, although I do not always follow his guidance. We shall look very carefully at what he said and see whether, in the light of failure to answer our points, we might come forward with an amendment which would be acceptable to the Minister. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 20 not moved.]
8.45 p.m.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 21:
Page 3, line 43, at end insert—
("(6) Any advice given by the Secretary of State under this Act shall be given no later than the 31st March of the year preceding the first year of the relevant period.")
The noble Lord said: With the leave of my noble friend Lord Underhill, I rise to move this amendment. Like so many of the amendments moved from this side of the Committee, it is a modest and helpful amendment and I hasten to say that it is designed not just to be helpful to the Government, but also to be helpful to the authorities and executives which would, if this Bill were passed unamended, have to try to cope with it.
As I indicated in referring to an earlier amendment, the timing is absolutely critical for the efficient operation of a Bill of this kind. Perhaps I may refer to the experience of the Greater London Council. On behalf of my Greater London Council colleagues I apologise to those who have heard at least enough, and probably too much, of the experience of the Greater London Council this afternoon and this evening. If I may refer to the recent experience of the Greater London Council, perhaps it will give your Lordships an idea of the complexity of the timing problems facing transport authorities.
I refer to the period of the past 12 months after the decision of the Law Lords that the Fares Fair policy was not legally acceptable and that amendments had to be made to it. They had to be made very rapidly, and in a period of only three months after the judgment a substantial increase in the fares—a doubling of the fares—was, in fact, enacted. It took from then right up until the end of the year for the London Transport Executive and the Greater London Council together to consider what could be done to restore some level of sanity in the setting of fares and the setting of revenue grants for London Transport over the succeeding years. It was apparent to everybody, I think including the Government, that the simple doubling of fares would not be rational transport policy. It did, in fact, result in serious loss of

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"ridership". It did not, in fact, achieve the objectives of their Lordships which was a break even operation of London Transport, and could never have done. So some means had to be found to find a more rational solution.
At that time, the approach of the Greater London Council was to look back at its obligations over a longer period of years based on wider legislation, going back to the London Government Act 1963, and to say: "If, under the London Government Act 1963, the Greater London Council is obliged to take into consideration in its transport policy all of the wider isssues which we on this side have been trying to bring into this Act as a principle for the operation of public transport authorities, and if one of the major tasks of the Greater London Council over this period has been the production, publication and final agreement of a Greater London development plan, which looks at the issues of employment, of journeys to work and of improving the economic efficiency of the running of our capital city, then surely that is the starting point for public transport policy also: that public transport policy ought to be directed towards our wider obligations"—"our" being in this sense the Greater London Council.
So the London Transport executive, at the instigation of the Greater London Council, produced a series of options, one of which at one extreme I am sure the Government would say was the revival of the Fares Fair option which had already been outlawed; the other of which was an attempt to get as close as possible to the breakeven, to which it appeared the Law Lords wanted to adhere. In the middle—and I really do mean in the middle, because it was a compromise policy from both a political and a transport operator's point of view—they came to the view of a balanced fares policy which took into account the wider implications of the Greater London development plan, how it was and how it should be that London is an efficient, viable, economic entity in which people's aspirations for change are recognised and not constrained by planning policies and in which at the same time people's aspirations for not having their environment destroyed by unwise planning policies were also recognised.
They put that balanced point of view to the London Transport Executive and said, "These are the kinds of objective which you ought to be looking for in producing a transport plan". The London Transport Executive said, "Yes, in transport terms we like this but, as we understand the Law Lords' judgment, it will not be legal". Therefore, a legal action was fought, if fought is the right word, in the Divisional Courts. The result of that was that in January of this year the Divisional Court found that that balanced fares policy, which took into account the wider implications which the Government appear to be totally unwilling to have written into this Bill, was legal.
It is going to take until the end of May for that decision to take effect, because a fares policy which includes not only a reduction in fares, that is one part of it, but also a substantial rationalisation—a very welcome rationalisation—of fares in Greater London takes time to get into operation with all the necessary changes made. It is always going to take that time. This
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is the point. We ought not to be rushing into decisions about fares policy. We ought not to be rushing into decisions about the level of revenue grant without thinking about the implications not only for transport services but also for the rates.
The immediate implication of this amendment would be that advice would have to be given for the year 1984–85 by 31st March of this year. I accept that that may cause some difficulties to the Government, and I am sure that the noble Lord the Minister will say so and suggest some constructive alternative. I am sure at the same time that he will also recognise that the timescale which passenger transport executives and passenger transport authorities have to produce reasonable, realistic fares and service policies, and to fit that programme into the setting of the metropolitan counties' and the GLC's precept, requires more time than appears to be provided for in the Act at the moment. I commend it to the Government, and hope that they will see their way to accept this amendment which is intended to make for a smoother working of any new transport system. I beg to move.
Lord Bellwin: May I say first that the Government fully accept that the Secretary of State must issue his advice in good time for authorities and executives to take account of it. Indeed, as a target the dates set in the amendment are, I think, not unreasonable. The problem, however, is that the amendment goes further than setting a target. It creates a statutory limit. The noble Lord recognises that that is the difficulty. In unforeseen circumstances the Secretary of State would be bound to issue his advice even if all concerned were agreed that there needed to be a delay.
While I cannot accept the amendment I offer the Committee the assurance that the Secretary of State will do his best to meet the timetable it would require. If there is concern that the executives, for example, may find themselves held up in carrying out their duty to prepare their plan by delaying the giving of advice by the Secretary of State, I would point out that they are required only to take into account any advice given. If advice is not given then they can proceed without it. If it is given very late in the day, then probably not much account can be taken of it. I should have thought that this would be a considerable spur to ensure that where advice is to be given it will be given promptly.
I am not without sympathy on this, as I am sure the noble Lord appreciates, because so often I have had to work within timescales and found it so difficult when we could not get the information we needed. But I fear that the real problem in trying to accept the amendment is the creation of a statutory limit as opposed to what really is not an unreasonable target at all. I am sorry not to be able to be more helpful to the noble Lord on this.
Lord McIntosh of Haringey: I am sure that what the noble Lord the Minister has said will be read word for word and letter for letter by the Greater London Council and the metropolitan authorities in considering what they have to do about fare levels over the next three months or so. He has given some encouragement for them to think that if advice is given late there is not very much—and I use the Minister's words—they can do about it. I remind him that, once

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he said that, of course all the metropolitan authorities by the time this Bill reaches the statute book will already have had to set their precepts, and those precepts will already be in the works and will start to be collected by the district and borough councils. What he has said will be read with great attention.
Looking over a longer period, Government response to submissions for rate support grant and for transport supplementary grant—and I speak without any party political aspect here because this has been true under both Governments—has become progressively delayed. The gap between submission and decision has got longer and longer. There has been a frantic scramble before Christmas for transport supplementary grant over a number of years under Governments of both complexions. It is a thoroughly undesirable state of affairs, particularly for an executive like the London Transport Executive which orders its affairs financially on a calendar year basis. However, recognising the sincerity of what the noble Lord the Minister has said, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
8.57 p.m.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 22:
Page 3, line 43, at end insert—
("(6) Any advice or guidance given by the Secretary of State under this Act—

(a) shall only be given in accordance with principles to be applied to all Authorities and Executives;

(b) shall set out the matters taken into consideration in preparing the advice or guidance and contain a reasoned justification and the matters taken into consideration for each item of advice or guidance.

(7) Before giving any advice or guidance under this Act the Secretary of State shall consult—

(a) such associations of local authorities or Executives and any Authority who wish to make representions;

(b) the British Railways Board, the National Bus Company and any other operator of public passenger transport services with whom an Executive has an arrangement under the Act of 1968 or the Act of 1969;

(c) such trade unions and employers' associations whose members are involved in the provision of public passenger transport services or the manufacture or supply of vehicles or equipment for use in connection with such services;

(d) local authorities in the area of the Executive in relation to contributions under section 138 of the Transport Act 1968 (travel concessions for the elderly, blind and disabled);

(e) local education authorities in the area of the Executive in relation to the transport of pupils;

(f) local authorities outside the area of the Executive in relation to public passenger transport services provided within the area of those authorities by or by arrangement with the Executive.

(8) The Secretary of State shall allow each of those consulted under subsection (7) above a reasonable opportunity to express their views and shall in giving any advice or guidance under this Act have particular regard to the views expressed in response to such consultations.").
The noble Lord said: Again with the leave of my noble friend I beg to move this amendment. The wording of this amendment will be familiar to the Government and to many noble Lords. In the new (6)(a) the phrase
"shall only be given in accordance with principles to be applied to all Authorities and Executives"
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is of course one which applies to the rate support grant at the moment. It again has been sanctified, if that is the word, by Governments of all political persuasions over a period of years, and I can imagine that there would be no difficulty in agreeing to that: that there should not be discrimination between one authority, or one executive, and another on the basis, as it may be under some Governments, of political prejudice, or indeed of any other wish to make a distinction.
Subsection (6)(b) says:
"shall set out the matters taken into consideration in preparing the advice or guidance and contain a reasoned justification and the matters taken into consideration for each item of advice or guidance."
That is a phrase which already occurs in the transport policies and programmes procedure, and that has been sanctified by usage. It has not caused any particular difficulty and goes some way towards requiring the Secretary of State for his part to come clean with the authorities and the executives in the advice, or guidance, that is given.
I do not want in a Committee stage to refer back excessively to previous amendments, but I must remind the Committee that there has never been a satisfactory answer to the question which has been put over and over again from this side of the Committee: what is the basis of the advice or guidance that is going to be given by the Government? How is the authority, or the executive, going to evaluate that advice or guidance? Can there be any common understanding of the factual basis on which the advice or guidance is given? Can there be some meaningful basis for negotiation, or discussion, between the Secretary of State and the authorities and the local authority associations about the nature of that guidance? Is there any way in which local authorities together can come to the Secretary of State and say, "This is the guidance you have given us. We understand from what you have said the basis of that guidance. May we put it to you, Secretary of State, that the factual basis is erroneous, and that the conclusions you draw from it may not properly be drawn."
At the moment the Secretary of State is exonerated from any responsibility whatsoever to give reasons, to give chapter and verse, for the advice or guidance given. Forgive me if I am repeating myself. I do so because the Minister replies, "It is only advice or guidance, and you can ignore it if you like", although he goes on to say, "At your peril, because you are then subject to legal process"—the most undesirable possible state of affairs for local government.
As we go on trying to make similar helpful amendments to the Bill, we find ourselves more and more in the position of discovering the Government to be like King Lear, saying in effect, "I shall do such things. I know not what they are, but they shall be the terror of the earth". The publicly-stated intention of the Government as frequently expressesd on Second Reading and in Committee, is to bring to heel rebellious and extravagant local transport authorities. When you look at the Bill, you see there is no relationship between that publicly-expressed sentiment and the actual provisions of the measure. The suggestions made in our subsection (6) should commend themselves to the Committee as being helpful in trying to get the Government to "come clean".
As for subsection (7), I should not have thought that any of its provisions could be considered unhelpful or unreasonable. Once we have established the principle to which the Minister has already agreed—that there should be the maximum possible time for a proper consideration of the advice and guidance—it then becomes possible to have the kind of consultation with the outside bodies (not just with the associations of local authorities but those otherwise affected, like the British Railways Board, trade unions, employers' associations and those concerned with concessionary fares) that is not only proper but possible within a reasonable timescale. I cannot think it would be the wish of the Government not to agree to that sort of consultation.
Regarding the proposed new subsection (8), I cannot think it would be the wish of the Government to have such consultation and not take into account, and give a reasonable opportunity for the expression of, the views of those who have been consulted in order to make it a real consultation process. My noble friend Lord Mishcon referred to the consultation process as, "I say what I think and you say what you think, and then I will go and do what I like". I am summarising, perhaps unfairly, what he said; but I hope that on issues of such importance as those we are now discussing there will be something rather more real arid more in recognition of the variety of interests that are involved in public transport in Britain. I beg to move.
9.2 p.m.
Lord Sefton of Garston: I support the amendment and perhaps I should begin by telling a story arising from an experience last week. I met an old friend of mine who is still a member of Merseyside County Council and one of the district councils, and he asked me whether I was pleased to have come to your Lordships' House. I replied, "No. On reflection, I think I would sooner be back in local government, because there you appear to be doing something even if you are not". He said, "It is almost four years since you were in local government. I suggest you think again because the attitude in local government now is really not worthwhile".
That strikes at the very heart of this Bill because it is leaving local government members, who have given a lifetime of service to local government, with the feeling that, as from now, they have ceased to count. I believe that the first part of the amendment is extremely important from that point of view; it will at least give local government members the idea that they have reasons for being dictated to. There will be something for them to argue about. I urge the Minister not simply to rise and blandly oppose the amendment. He should think about it because, even if the amendment is not acceptable, there must be a compromise by which he can introduce a new element of trust between central and local government, because at the heart of our democracy is the relationship between central and local government. If the Minister rejects the amendment out of hand, that trust will be almost completely destroyed, and, goodness knows! it has almost gone already.
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As for the powers of consultation in the amendment, I can imagine the Minister telling himself, "If we have to go through all that consultation, by the end of three years we shall not have concluded the consultation and will not be able to make a decision". I urge him not to give an answer now but to take a little time to consider the amendment, to see what he can do about approaching local authorities on the sort of basis that is proposed.
Let me give an example of what is worrying many people on Merseyside—and I refer not to Labour politicians or members of the Church but to people in the retail trades, the social services, charities and so on. They are all very worried about the new disadvantaged and disabled people. They are not usually called the disabled; they are usually referred to as redundant or unemployed people. Unfortunately, we have moved many of these people away from the centre of activity. I received a letter today from the Archbishop of Liverpool, who is very keen that the unemployed of Liverpool should be seen in the same way as disabled people from the point of view of transport facilities. Whatever view is taken of concessionary fares for the aged and disabled, the unemployed should receive such concessions because they are suffering just as much a disability, and the removal from them of a subsidised system of fares to enable them to get from their homes to centres of activity is the same as inflicting a penalty on them.
If the amendment were accepted, the Government would have a means of being able to make a reasoned case for the views they are taking, in discussions with local authorities. On the other hand, if the amendment is not carried, it will mean that the Government are turning a stony face to appeals for reasonableness, and everybody will say that and the damage being done to local government will get even worse.
Lord Bellwin: I admired the speech of the noble Lord, Lord Sefton, with its underlying sympathies, and I like to think that the attitude underlying it is very much my own. I too am very concerned about the central-local government relationship, and anything that can be done to improve that relationship must be a very big plus, because goodness help us should the day ever come when local government becomes as he feared it might become. I do not think that local government is like that. Perhaps it has been moving in that direction, but this is not the occasion to philosophise, though dearly I should like to do so because I feel very deeply about the matter. Perhaps there will be another occasion on which to do so, rather than at this time of night, tempted though I am.
The problem with the amendment is that its wording does not recognise the fact—I am aware that the noble Lord who moved the amendment certainly recognises it, since he knows the subject so well—that metropolitan areas, their local authorities and transport executives differ so much. They very much vary one from the other. I understand that there were lengthy debates during Committee proceedings in another place, with Opposition members explaining that diversity and arguing that, because of its special circumstances, each authority should be excluded from the Bill. In these circumstances I cannot see how the guidance given by the Secretary of State under the

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Bill could do justice to each area, and yet—as the new subsection (6)(a) in the amendment would require—be based on principles applied to all. The amendment seeks the application of a standard formula or formulae, and I wonder whether that would be in the best interests of the authorities and executives.
I should like to give an example of the point that I have in mind. The PELs that we have proposed for 1983–84, as set out in the White Paper, take account of Tyne and Wear County Council's desire to see a proportion of the operating deficit of its PTE next year funded not by grant, but from the PTE's reserves. A formula approach might have meant that it would have been impossible for us to take these special circumstances into account.
The new subsection (6)(b) would require the Secretary of State to provide detailed explanations of his reasoning in arriving at his advice and guidance. I am not without sympathy for that point, and I only wish that there had been greater consultation with the local authority associations, especially the AMA. The Government sought such consultations, but the AMA, for internal reasons—and I know how it operates—felt unable to consult at all with the Government. Perhaps, had the normal kind of consultation taken place, it would have been easier for me to give answers to some of the points raised tonight in a chapter and verse style by certain Members of your Lordships' Committee.
We are not dog-in-the-manger about this question. We are not playing a game. We are trying to get the best possible Bill, the one that will work best, and I say on behalf of the Government that we shall be having discussions. We want to discuss these issues further with the local authorities concerned, both before and after the Bill comes into effect. Then perhaps we can come to some of the kind of points that the noble Lord, Lord Sefton, was making. If discussion of that kind could take place it would be helpful, but how on earth we would be able to do it if we were pinned to a formula basis, I really do not know. Nevertheless, this is precisely the kind of problem that can best be hammered out in consultations.
Part of what is proposed in the amendment would involve detailed comments from the Secretary of State on the proposals of the authority, and some people would say that that would amount to an increased degree of interference. Again, one cannot have it both ways. One has to try to get it just about right, and this is not the first time that I have come across a contradictory situation, well-meaning though the intention is.
I should now like to turn to the part of the amendment that would require the Secretary of State to consult a wide range of organisations, both before issuing his advice under Clause 3(5), and again before announcing his guidance under Clause 4(5). He would then be required to give a reasonable opportunity for comments to be made, and he must then take any comments into account. Much as I respect the objective of requiring the Secretary of State to consult persons affected by his decisions, there are two main reasons why I cannot accept these proposals. First, they would considerably delay the announcement of the advice and guidance, and I believe that they would
1020
hinder the authorities and executives in their forward planning. There would be uncertainty while the consultations took place; and that cannot be a good thing.
But there is a more fundamental objection. The consultations proposed for the Secretary of State are surely more properly a matter for the authority. As I keep saying—I am sorry to keep going back over the same ground, but all along we have known that there is considerable overlapping in the amendments and the clauses—at the end of the day it is for the authority to decide who should be consulted over its proposals. The amendment would seriously undermine the responsibilities and accountability of the authority regarding its plans and the provision of local public transport, if the Secretary of State were required quite independently to consult organisations on an authority's plan, and then, when formulating his advice and guidance, to take into account any representations made.
9.14 p.m.
Lord Tordoff: I take the point that the noble Lord is trying to make. Surely subsection (7), as in the amendment, refers to the advice and guidance given by the Secretary of State, which is a different matter. What we are trying to get at in this amendment is to feel at the end of day that the Secretary of State has come to his advice and guidance on some rational basis. We are making legislation here for some time to come and Secretaries of State change. One may have the greatest possible confidence in the present Secretary of State, even if others have not. This is what we are trying to probe with this amendment: what rational process is going on in the mind of the Secretary of State when he comes to the decision to give advice or guidance? It relates to that advice and guidance which we all know is semi-mandatory at the end of the day. But even if it is not, how does he arrive at that decision? It may be that the details in this amendment are not the right ones. Perhaps some of the people to be consulted are not here; perhaps some of the people who are here do not need to be consulted. He needs, surely, to take some advice from outside in reaching his decision on what advice he shall give.
Lord Bellwin: Again, the noble Lord, Lord Tordoff, explains why there is concern. I think that I understand that. The proper course for the authorities to carry out consultations if they wish to do so would surely be to do this and incorporate the views expressed in the plans before the plans are submitted to the Secretary of State. I shall come in a moment to the point which the noble Lord made, but I should like to follow the thread. So they might wish to consult after receiving guidance from the Secretary of State and before determining the grant and approving the plans. The final responsibilities for the plan and for the provision of public transport lie with the authorities. It is for them to decide whom to consult over the provision of those services.
Regarding the new subsections (7) and (8), I can see no need for the Secretary of State to consult the authorities before announcing his guidance figures. They would have advice from the Secretary of State as to his views on the form and content of the plans, and

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they would have the guidance. As I have said, they would be free to exceed this guidance if they wished. There is no point in adding further statutory requirements for consultation to the procedures in the Bill. We seem to have become bogged down with the procedures.
May I come back to the point that the noble Lord made: I accept that that is a basic one. What will be included? What is the basis? I come back to my earlier point: there has to be more consultation. I have given an assurance on this and this will take place before and after the Bill is on the statute book. More consultation should have taken place now. In my time, we often had Bills coming before the AMA which we did not like; but we always felt that we would get much further down the line if we made sure that we put our 10 cents in as best we could. Here, unhappily, this has not been the case. It could well be that there is room for further talks.
I should like to pick up the point that the noble Lord. Lord Sefton, made when he said, "At least have a look and do not close your mind". That is a fair point to have made, especially on this issue, which is obviously giving a lot of concern. I cannot accept the amendment. The noble Lord knows that I can make no commitment at all. There is some merit in this particular point about how to get a balance between not wanting to get a lot of chapter and verse in, with all the problems it presents as regards delays, and the diversity that there is in areas. That is on one side. Yet, on the other side, there is wanting to give as much advance "guidance"—if I can use the word in that sense—as possible. So I should want to think and talk about that because I think it is right. Beyond that, I cannot go.
Lord Underhill: I must make one or two points in support of this amendment. I do not want to detract from the amendment by bringing in the AMA. The Minister said "if the AMA had had consultations". As he knows, I am the president of the AMA. I was reading certain documents only last night. There was a meeting with the Secretary of State, and there was also one meeting at which the Under-Secretary of the department attended at the start of the meeting. I shall endeavour to turn up the dates and give them to the noble Lord in case he thinks I am not giving him the correct facts.
On consultation, the Minister keeps referring to the determination of revenue grants as if that is the only matter on which advice and guidance is to be given. Clause 3(5) gives a number of items on which advice and guidance is to be given. I must come back to the point made by the noble Lord, Lord Tordoff. If the Secretary of State is going to disagree generally as to the form and content of the plan, if he is going to disagree with levels of demand or with certain levels of services whom is he going to consult? Is it merely the officials of the department, excellent though they may be?
The Minister says that it is up to the authority to consult these bodies, but I doubt whether they will. But if he is going to turn down the points that are in the plan, whom is the Minister going to consult? Or is he going to be the all-powerful person sitting in Marsham
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Street? We have tried to avoid melodramatics on this subject, but the point is that the Secretary of State is all-powerful in giving advice and guidance. Then, as regards guidance and advice, they can deal with details of the plan and not just the question of the level of revenue grant. The noble Lord said metropolitan areas vary. We know that only too well. The size is different; the make-up is different; and some have vast rural areas. Surely, that makes it even more important that when the Secretary of State gives advice and guidance, disagreeing with certain points in the plan, he ought to tell the local authority the reasons why he disagrees with certain things. Surely, this is where confidence grows. If that is not done, the impression will develop that the purpose of the Bill is to prevent authorities from spending more than the Secretary of State thinks is right. He will be able to turn items down and give no reasons whatever for doing so—because there are many points of detail covered in subsection (5), as I think the Minister will agree.
Lord Mishcon: This is an important amendment because it deals with something we have touched upon, and indeed accentuated during this afternoon's debates on the various amendments: namely, the very important matter of the relationship between national and local government. I want to revert to that for one moment. I regard it as somewhat extraordinary that so many comments should have been made by the noble Lord the Minister about the desirability of this principle: yet when it comes to every amendment which tries to patch up this relationship, which is in a very difficult state at the moment—let us not have any doubts about that—may I quote again from King Lear, from which my noble friend quoted so learnedly? I remember two things from King Lear. One is his angry and pain-ridden cry to his youngest and nicest daughter: "Nothing comes of nothing". That appears to be the fate of every single amendment we have put to this Committee. Now I plead with the Minister, if I may, by using another poignant quotation from Lear, which is: "Make me not mad".
On that note, I would say this to him, because this is sanity. We are walking into a situation where, rightly or wrongly but nevertheless understandably, local authority associations are definite in the view that this Bill, added to other Bills that have been passed by your Lordships in this Chamber and in another place at the instance of this Government, will ensure that local authorities are being denied their democratic rights and are being put almost into oblivion. I quote the noble Lord, Lord Sefton, who said so well that this was possibly making people who wished that they were back in local government, talking to present members of local government, feel that maybe it is not such a good thing for people with intelligent and independent views to go into, with all their powers clipped.
This is what I am trying to say to the noble Lord the Minister: let not nothing come of nothing in regard to this amendment. He has offered to think about it, without commitment. That is a generous thing to say but not over-generous, because there is no commitment and it is not a terrible liability that a Minister has to think. It may be embarrassing or too heavy for them at times—
A noble Lord: It has been known to happen!
Lord Mishcon: Nevertheless, it is not such a grave responsibility for him to have to think. What I am saying to the noble Lord the Minister, and I am saying it with great sincerity on behalf of my noble friends and myself, is this: there is an opportunity to build into this enactment a compulsory consultative procedure. Consultation can be had, if you like, within limits of time so as not to postpone things indefinitely. Consultation can take place—to use the Minister's own phrase—without commitment. But consultation ought to take place—and I am sure that the noble Lord the Minister will, on reflection, agree with this—because it is written into the Bill, not as a matter of benevolence and not, if you like, at the instance of the local authority associations. This dignity local authority deserves, before the advice is given on the plans and in other ways that are mentioned in this amendment.
I am borrowing from another speaker on this amendment. This is not my original thought, although I felt it even before the noble Lord said it. This may not be the ideal formula. It may very well be that another consultation formula ought to be hit upon by the Government, to which they can agree, without the limitation on timing, without the delay factor and without the difficulties of different local authorities and the problems of various areas.
I ask the Minister to say openly, before this amendment is finally debated in Committee, that he sees merit in writing into this Bill a consultation procedure with the local authorities at a vital time, and to say that he will do his best before Report stage to put down a Government amendment of some kind which deals with that consultation procedure. Then I believe that the Committee may well be satisfied with such an assurance, without binding him to the nature of the formula, and we shall feel that something hats been achieved by the long hours in which your Lordships have been trying hard to debate this matter and to improve this Bill in this vital respect.
The Duke of Norfolk: I apologise to the Committee for the fact that I have been here for only the last half-an-hour, but I have had many letters from Archbishop Warlock on Merseyside about the representations of the noble Lord, Lord Sefton, and I have studied the matter very carefully. I should like to come down very strongly on this matter in this way. It has been suggested by many very serious noble Lords, who have quoted King Lear and others to support them, that the seven metropolitan counties will look after the disabled, the aged and the poor much better than central Government. This Bill will in no way affect them. The poor, the disabled and so on will still have their free transport and all the assistance given to them by the special benefits.
Is it not true to say—I ask this most sincerely, because I have had correspondence about it—that this Bill will in no way penalise the poor, the disabled or the others who have been quoted, because it is simply saying that the way in which transport is governed will be reformed, as will the allotment of money given by central Government to transport? But, in no way—and the metropolitan counties are suggesting this—will any living person be harmed by this Bill. I think that the Minister will bring that out, as I gather he brought it out previously today.
Lord Tordoff: We always listen with interest and respect to the noble Duke's interpretation of the views of the hierarchy, but I am not entirely sure of its relevance to this amendment. I want to follow the noble Lord, Lord Mishcon, and to say that, although what he says is important, and we hope that the Minister will give some assurance along these lines, I hope that, in addition, he can give some assurance in relation to paragraph (6)(b) of the amendment, because it seems to me that, almost more importantly than what he says—and, as usual, he put the case very clearly—the need to set out those matters which have been taken into consideration in giving advice is, perhaps, at the heart of so many of our worries.
If we could have an assurance that the Government will find a means of expressing that in an acceptable way—the noble Lord said earlier that he is reaching towards this side of the Committee in order to come to an understanding—it would be a great help to us. This aspect might even take priority over the consultation point which the noble Lord, Lord Mishcon, made.
Lord Bellwin: One is of course trying to be helpful. When the noble Lord quoted from King Lear that this shall be the terror of the earth, I was tempted to say that what has been going on up to now is very much the terror of the earth, but if I did so I should be getting back to Second Reading and into philosophy. The hour is late. Because the central Government—local government relationship is so much at the heart of what I have to deal with on a day-to-day basis, I should have liked to say to the noble Lord, Lord Mishcon, how sad I am about so many of the things which local government have done to contribute to this situation. But this is not the time. I cannot give the assurance which the noble Lord, Lord Mishcon, asks of me. I can only repeat what I said I would do. I understand fully the points which have been made. I shall read them carefully, talk to colleagues and then see exactly what is the current thinking. At this stage I cannot go further than that.
Lord McIntosh of Haringey: Keeping to King Lear, I am tempted to start by saying "Down, wantons, down". We have made some progress. Clearly we are at the beginning of a new drafting process which deserves the attention of the Committee. I would only say to your Lordships that in considering consultation about drafting the Government should realise that in the last few years the issue of consultation for local government has become not just a matter of more importance but of more legal importance than it ever has been in the past. The judgment of the Law Lords in the Greater London Council's Fares Fair case rested, in major part, on the allegation that the GLC had not consulted the counties outside London about their fare structure. No matter that this policy had been pursued by the Labour Party for at least five years before that, that an election had been fought on the issue and that all the elements in the Fares Fair policy had been a matter of public debate over a period of many years. The courts found that the lack of formal consultation with people who were only marginally consulted was a significant reason for ultimately finding the decision illegal.
Local authorities cannot therefore afford to be reassured by reasonable statements of the noble Lord

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the Minister. He is a reasonable man. But when we are dealing with legislation of this kind it needs more than reasonable statements and expressions of goodwill. We need the assurance that the obligations which are very clearly placed upon local authorities in their consultation shall be taken with equal seriousness by Government. Only in that way shall we be satisfied at Report that any significant progress has been made. In view of the statements which have been made, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 3 agreed to.
Clause 4 [Approval of financial plans and determination of revenue grants]:
[Amendments Nos. 23, 24 and 25 not moved.]
Lord Denham: We have probably reached the appropriate stage at which to finish this evening's business. If noble Lords opposite agree, I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.
House adjourned at twenty-five minutes before ten o'clock.