HL Deb 09 February 1984 vol 447 cc1294-326

4.53 p.m.

House again in Committee on Clause 1.

[Amendment No. 2 not moved.]

Lord Stoddart of Swindon moved Amendment No. 3:

Page 2, line 3, after ("appoint") insert ("following an examination of the candidate by the House of Commons Select Committee on Trade and Industry").

The noble Lord said: I beg to move Amendment No. 3 which stands in the names of my noble friends Lord Bruce of Donington and Lord McIntosh of Haringey and myself. I listened very carefully to the previous debate which showed very clearly that there was great concern at the lack of accountability in this particular Bill. That was expressed by the noble Lord, Lord Lloyd of Kilgerran, and other noble Lords from all parts of the Committee, and the vote—which was a very close run thing for the Government—showed just how concerned noble Lords are about the Bill.

We on this side of the Committee are very concerned about parliamentary accountability. Indeed, many later amendments to make the actions of the Secretary of State subject to parliamentary approval show how concerned we are. I am glad to say that we are joined in that concern by the noble Minister who, in arguing against the previous amendment, felt that parliamentary accountability might be weakened if it were passed. Under those circumstances I hope that he will welcome this amendment, which I am sure he will agree will strengthen parliamentary accountability and certainly not weaken it.

We are also concerned with the abolition of the Post Office Users' National Council. That body has looked after the interests of telephone consumers over a very long period and has done so very satisfactorily indeed. The advisory bodies to which the noble Minister referred, and which are mentioned in Clause 52 of the Bill, are not of the same status as POUNC, and nor indeed will they have the same authority. Further-more, because British Telecom will cease to be publicly-owned, the ability of Parliament and individual Members of Parliament to probe, to question and to some degree protect the customer will be severely circumscribed by the Bill—if not eliminated altogether.

The fact is that we are about to convert British Telecom from a public monopoly into a private monopoly. One of the reasons for the proposal to set up a Director General of Telecommunications is to do the job which the Post Office has been doing over the last 70 years, and that is to provide a satisfactory service to the consumer, and indeed to protect the consumer. Now we have to have all sorts of bodies to do the job that the Post Office itself, and subsequently British Telecom, have been doing over a very long period. This amendment is, therefore, part of our endeavour to retain a role for Parliament in the new telecom set-up which will be created when the Bill becomes law.

Those of your Lordships who have read the amendment will I am sure agree that it is a very modest one—a very modest one indeed. It seeks only to give the Select Committee on Trade and Industry (I understand that it is now called the Select Committee on Industry and Trade) the opportunity to have a meeting with the Secretary of State's nominee, to question him if necessary and, of course, to hear from him his ideas about the role of the director general and how he intends to discharge that role. There is no suggestion at all in the amendment that the appointment be subject to the approval of the Select Committee. There is no suggestion that the Select Committee should be able to say to the Secretary of State, "Oh no! you can't have this fellow; we don't approve of him". There is no suggestion like that at all. So this is a modest amendment. It might not go far enough for some, but we believe that it is an amendment which should secure wide support in your Lordships' Committee this afternoon.

I am not at all sure whether such an amendment has ever been moved before in this House or in another place, but certainly to my knowledge one has never been carried before and, therefore, this afternoon the Committee has the opportunity to make parliamentary history in a unique way. However, the question of parliamentary involvement in making appointments of chairmen of nationalised industries has certainly been discussed. It has been discussed previously by the House of Commons Select Committee on Nationalised Industries, Sub-Committee E, during the Session of 1978–79 when they investigated the relationships between Ministers, Parliament and the nationalised industries. As noble Lords know very well—and some noble Lords have been involved in them—those relationships are very important. The Select Committee took evidence which was published, but unfortunately it was unable to report due to the intervention of a general election in May 1979. Of course, following that election, the Commons Select Committee system was altered and the Select Committee on Nationalised Industries was not reconstituted.

However, the evidence makes interesting reading and, although some members of the Select Committee had more radical ideas than those which are contained in this amendment, the replies to questions put to the then chairmen of nationalised industries were instructive although divided. Some chairmen were happy about Select Committee involvement in appointments; others were not. For example, Sir Arthur Hawkins had no objection at all; the Electricity Council had no objection at all. Sir Henry Marking was certainly against, as was the Nationalised Industries Chairmen Group—the bosses' trade union. The noble Lord, Lord Boyd-Carpenter (who is sitting in his place), had serious reservations. I think that I put his view properly but no doubt, if I have not, he will have something to say later on. What was encouraging was that this novel concept—that is, for this country—was not rejected out of hand by all the chairmen, all of whom incidentally treated the suggestion with the utmost respect and were firm in their adherence to ultimate parliamentary accountability.

But, of course, we are not here discussing the appointment of a chairman of a nationalised industry. Instead we are discussing the appointment of a director general whose duties will be manifold, diverse, and largely regulatory. We should, of course, prefer that there was no proposal to appoint a director general at all, as we believe that the Secretary of State should continue to be the regulating authority over a completely publicly-owned British Telecommunications body. However, I rather fear that the Government intend to have their way in converting British Telecommunications from a publicly-owned monopoly to a privately-owned one. With that we have to accept the eventual appointment of a Director General of Telecommunications.

However, as I have already said, the director general's powers will be very wide-ranging. For example, under Clause 3 of the Bill he has to secure the provision of telecommunications throughout the United Kingdom and to satisfy all reasonable demands for them; he has particular responsibilities to ensure that certain services are preserved. He has the duty to promote the interests of telephone users in the United Kingdom in respect of prices, quality of service and apparatus. He has to promote efficiency, economy and research. He will be responsible for granting licences under certain circumstances, and indeed for policing them; and, if he sees fit—again under certain circumstances—he will be responsible for modifying those licences.

In Part III of the Bill, the director general has the duty to keep telecommunications under review and in so doing will, to a greater of lesser extent, be a policy-maker. That, too, is important for Parliament and parliamentry control. In Clause 51 he is charged with the duty to investigate complaints, and in Clause 52 he is given the power, though not the duty—and note that—to establish advisory bodies. He is, therefore, intended to be a promoter, a regulator, a dispenser of privilege, a customer watch-dog, a manufacturer watch-dog, and he has the power to decide for himself whether or not he invites advice from outside his own office. He is a very powerful person indeed. We shall need a veritable Solomon to fill this post. Those are indeed formidable powers and duties, and in the exercise of them, one way or another, the director general will be impinging on the everyday lives of 80 per cent. of our citizens who enjoy a telephone service.

The director and the Office of Telecommunications are, of course, new situations for the Government. Indeed, for any government this will be a unique set-up in Britain, although, of course, it is not unique in other countries, especially in the United States of America where regulatory authorities abound. The new body will be created by this Bill's becoming an Act of Parliament: the body will be created by an Act of this Parliament. In my own view, and that of my colleagues, it should be viewed as an arm of Parliament rather than an arm of Goverment. That is particularly important for consumers.

Of course, in the United States of America, where, as I have said, regulatory bodies abound, the Senate has a very positive role to play—not in the actual appointment of the presidential candidate, but in vetting that candidate and, in the last analysis, in preventing his or her appointment. Certainly this procedure in the United States has been successful in showing up weaknesses in the ability of candidates to perform the functions of the proposed office, has been a protection against political graft and patronage, and also against the appointment of criminals to high office. In this amendment there is no suggestion of adopting the United States system here, and I cite their system merely to underline that what I am suggesting is not a red revolutionary concept—not a bit of it—but is, in fact, an idea and, indeed, a practice that operates in a free, democratic and open society like that of the United States of America.

In this sense the amendment is not partisan; certainly it is non-party political. It is not exclusive to the Labour Party to desire more parliamentary influence on a range of matters. I believe that all noble Lords—indeed, all Members of this Parliament—wish to see proper parliamentary accountability and, where it is necessary, to extend parliamentary advice and in some cases control of the Executive. We do not claim in any sense that the Labour Party is exclusive in desiring more parliamentary influence on affairs and in particular on the appointment of the director general.

Of course, in respect of this particular appointment we believe that it is even more important that there should be a parliamentary input, because the director general's duties and his office will impinge upon the everyday lives of individual citizens. In my view, it is an amendment which is perfectly respectable and acceptable to all sides of this noble Committee. Indeed, it may very well be acceptable to the Government and, as I said earlier, even be welcomed by them. They may wish to support it and adopt it as their own, bearing in mind their sponsorship of and support for the new system of House of Commons Select Committees, a system on which I supported them, and indeed spoke for them, in another place. From the Government's point of view, there would certainly be merit in adopting this amendment, for by doing so they would be confirming in a tangible manner their support for the new Select Committees by asking them to assist the Government in this appointment, where the powers and duties of the office so directly affect people's lives.

I commend the amendment to noble Lords. I hope that they will consider what I have said and appreciate that I am sincere in wanting to extend, to some degree, parliamentary control, particularly over this office. I hope for the widest possible support in the Division Lobbies—that is, of course, if the Government feel unable to accept the amendment. I beg to move.

5.10 p.m.

Lord Boyd-Carpenter

I fully share the feelings of the noble Lord, Lord Stoddart of Swindon, in favour of very full use of the Select Committee system in another place, and indeed of bringing not only the chairmen of nationalised industries but other persons holding high office in the public sector before these Select Committees. I could hardly do otherwise, having myself been chairman of the most ancient, and perhaps the most powerful, of all Select Committees: the Public Accounts Committee of another place. But I do not think that that feeling which I fully share with the noble Lord concludes this matter.

It is a somewhat delicate operation for this House to seek to impose upon a Select Committee of another place an additional duty. This may have some bearing on that curious, sensitive and very interesting subject, the relationship between the two Houses. But that, no doubt, could be overcome by consultation.

What I find unattractive about this proposal is the blurring of responsibility which it involves. As I understand the amendment, and what the noble Lord said in most lucidly explaining it, the "candidate"—a curious word to use in this context, but I take it that it means the person whom the Secretary of State is contemplating appointing—should be examined by the Select Committee on Trade and Industry. As he admitted this has a curious transatlantic whiff about it, although the basic difference between this procedure which the noble Lord suggests and that adopted by the select committees of Congress and the Senate is that they examine the candidate and they also decide whether to approve him or not. The noble Lord's amendment does not propose that. It leaves the appointment with the Secretary of State.

Let us think for a moment about how that would work. Suppose the "candidate", as he is described in the amendment, has a bad time in front of the Select Committee, as many witnesses and many people appearing before Commons Select Committees, as your Lordships, may have had——

Viscount Trenchard

Hear, hear!

Lord Boyd-Carpenter

I hope my noble friend is not drawing on a personal reminiscence! But let us suppose the candidate has a bad time. What is the Secretary of State to do? Is he to say, "I personally think he's a perfectly good chap, but he has had a rough time in front of the Select Committee and I had better not appoint him", That means that the Select Committee has taken upon itself quite a large degree of the responsibility for making or not making the appointment. Or the Secretary of State may say—though no Secretary of State would use this language—"In my view, to hell with them, I am going to appoint him!" Then the unfortunate chap starts on his, we all agree, very important appointment with the great handicap of having been knocked about and damaged before a Select Committee of the House of Commons. As your Lordships know, these Select Committees generally sit in public. It would be a very great handicap to start with his moral authority battered as a result of a rough handling before the Select Committee.

Therefore, I hope your Lordships will feel as I do that what is proposed in this amendment is neither one thing nor the other. I am not saying that it is right or that I would support it but it is not taking the comprehensible line of saying, "Let us adopt the American procedure in full and make this a parliamentary appointment". There is an argument for that. There is an argument for doing what the Bill says and making the Secretary of State responsible, with no excuses, for the appointment that he makes. This is neither one thing nor the other. Either the Secretary of State will be pushed, as a result of the bad treatment of his candidate before the Select Committee, into not making an appointment which he himself ex lypothesi thinks right or he will make the appointment in circumstances of the utmost disadvantage for the candidate because for reasons I have already mentioned—I will not weary the House by repeating them—he has been subjected to adverse publicity and harsh treatment before a parliamentary committee.

I cannot think of a more unsatisfactory way of making a public appointment. I speak with some experience because I have held offices in my time which involve the very difficult task—as any of your Lordships who have had the same experience know, the extraordinarily difficult task—of assessing people whom one is to appoint to a public appointment of this kind. Therefore, though I fully share the noble Lord's wish to assert parliamentary control as much as possible, I am quite sure that this is the wrong way to do it.

Let the Secretary of State make the appointment. If he makes a bad one give him no excuses. Do not put him in the position of being able to say, "Oh well, the Trade and Industry Committee liked the man"; and do not give him the excuse, if something goes wrong, of saying that the Trade and Industry Committee damaged the man. Let the Secretary of State stand with clear-cut responsibility for appointing the right man.

After the appointment has been made, by all means let the Trade and Industry Committee, the Public Accounts Committee or any committee of this House—if it be your Lordships' wish—examine him on the conduct of his office, but do not let us muddle up the responsibility for the making of quite an important appointment.

Lord Lloyd of Kilgerran

Before the noble Lord sits down, having regard to his great experience in these matters, can I ask him this: if the potential candidate gets so badly knocked about before a Select Committee of the House of Commons and really cannot manage that committee, is it not obvious that he is an unsuitable candidate to be a director general?

Lord Boyd-Carpenter

With respect to the noble Lord, I think that question reveals a certain confusion of thought on his part. First, this job and other jobs of this kind are not necessarily ones for which parliamentary abilities—including the ability to handle a Select Committee of the House of Commons or this place—are required. I have known persons of immense practical ability who have been thoroughly bad in the House of Commons (dare I say it, even in this House) and different qualities are not always to be found in the same man.

Secondly, a Select Committee itself is quite a difficult thing to handle. Those of us who have been Ministers of the Crown in another place have all had rough handling from the House of Commons itself on occasion. We have never felt that that was a conclusive argument that we were unfit for our jobs. On the contrary, we have thought that the capacity to survive, however battered in those circumstances, was a good thing. I am afraid I disagree entirely with the noble Lord. The qualities required are not always in the same man. They may be totally different. It would be a superficial judgment to throw out a first-class administrator merely because he had been knocked about by a number of Members of another place.

Lord Beswick

I am bound to say that I do not follow the noble Lord, Lord Boyd-Carpenter. He makes the case that there is a blurring of responsibility in this amendment. But I should have thought that the Bill were an exercise in the blurring of responsibility. The whole thing is a mishmash of responsibilities. We have heard talk about the duties of the director general. He has to be a wide-ranging character with immense, almost judicial powers. We have heard about the necessity of the Secretary of State to have unblurred responsibilities in his appointing. We have heard also about the need for parliamentary responsibility; the chain of responsibilities, said the noble Lord, Lord Cockfield, must be unbroken.

At the back of my mind I seem to think that there is a gentleman who will be the chairman of British Telecom. I wonder where he is going to come in. He is going to have the responsibility of running an immense organisation and yet he is liable to come up against this director general on quite important matters so far as his responsibilities are concerned.

I read in the newspapers that the chairman of British Telecom is not wholly adverse to this Bill. I can understand his reasoning. I think that if anybody has to run a large organisation, the thought that he might have the Secretary of State ring him up to tell him that he should do this or do that is not always conducive to initiative and to sound administration. But if that is the basis of the present chairman's disposition towards this Bill then I think he will be disappointed. I think that he is going to find things very different. I think that there is going to be much more prospective frustration as a result of this set-up than there is at the present time.

And all of' this leads me to think that the appointment of the director general is going to be a very important appointment. The noble Lord, Lord Boyd-Carpenter, said that you might have someone who is a good administrator and yet he will not be a good performer in front of a Select Committee. I can understand that perfectly; but here, in the person of this director general, you have got to have more than just a good administrator. As my noble friend said a little earlier, you have got to have a Solomon. Whether the Select Committee can weed out the Solomons, I do not know. But I am inclined to think that it may be that their judgment in these matters will be as useful as that of the quite unqualified decision of the Secretary of State.

It is going to be a most important appointment. I can see in this whole field a whole set of confusions and frustrations and counter-interests developing. It is most important that we have in the person of this director general—if we cannot have the sort of authority that was talked about earlier to advise him—a person of political judgment (if you like) because a lot of the matters which are going to come up before him will involve a political element. I suggest to the Committee that there is more merit in this amendment than the noble Lord, Lord Boyd-Carpenter, suggested.

Lord Morris

I think that this amendment is an extremely dangerous amendment for three very simple reasons. Two of them are reasons spoken to by my noble friend Lord Boyd-Carpenter; but I believe that there is another one. The whole purpose of this Bill is to ensure that control of the environment for healthy growth in this industry lies with government and not with one or a series of companies in the public or the private sector. It is critically important, as the noble Lord, Lord Stoddart said, that this man be a man of immense ability, in no way deterred by the thought of a third degree in another place.

We have all the figures in the world, through the American experience, of those men and women who have been appointed to high public office in the United States of America; of how well they have done before the committee, and of how well they have done in holding down their particular jobs. What we do not know of are the hundreds and thousands of men and women who are very seriously deterred even from contemplating a position when they saw no reason why they should go through an extremely severe public examination. It is critically important that the right may be found. I think that it will make the life of the Government extremely difficult if we go through with this suggestion. Of course, I agree entirely with my noble friend Lord Boyd-Carpenter in saying that it is certainly not the business of this House to suggest to the other place what it should or should not do.

Lord Donaldson of Kingsbridge

This House lost by a very narrow majority—by four votes,—an attempt to introduce more influence of Parliament to this appointment and to this whole Bill. I have enjoyed disagreeing with the noble Lord, Lord Boyd-Carpenter, for many years very much and I am embrarrassed to find it very difficult to disagree with him in what he says. The truth is that the proposed Select Committee is in the first place, a political appointment. There will be a majority of the party in power on the Select Committee; so it is not non- political and it will not be a non-political examination. Secondly, it is put forward as if all the candidates were before the committee as for an appointment; whereas, in fact, it is an examination of something that has already been done.

I think that it is a muddled approach and a wrong approach fundamentally and in the end. But, as the noble Lord, Lord Cockfield, who is to answer for the Government, with great politeness rejected by a very narrow majority our first attempt to introduce parliamentary responsibility, I do not feel that I can do anything but support the second attempt, however little I think it will lead to a satisfactory solution. I think that the right thing for the noble Lord to do this time is what he did not do last time—which is to take the thing away and say, "I see what you are trying to do. It does not quite work out but I shall put up an alternative suggestion".

Lord Cockfield

The noble Lord, Lord Stoddart of Swindon, ranged very widely in moving this amendment. He started by referring to the results of the previous Division as a close-run thing. I am sorry to have to remind him of the implications of that phrase. The words were used by his Grace, the Duke of Wellington, when referring to his victory at the Battle of Waterloo over the defeated Emperor Napoleon—and I am somewhat surprised to find the noble Lord, Lord Stoddart, casting himself in the role of the Emperor Napoleon. He then proceeded to quote in his support procedures in the United States. Of course, the most important thing in the United States is that telecommunications are in the private sector and not the public sector. Whether the noble Lord's reliance upon United States precedents means that he has now seen the light of day, I do not know. But at any rate it would be a most helpful conversion.

He then refers also to proceedings in another place. I am always somewhat reluctant to pray in aid proceedings in another place in support of what we want to do in your Lordships' House. But I feel bound to remind him that, while this precise amendment was not moved in another place, another amendment providing for very widespreaad consultation was moved, was debated for five hours and was defeated on a Division. So that, as far as the proceedings in another place are concerned, they really do not help the noble Lord.

My noble friend Lord Boyd-Carpenter speaks with immense knowledge and wisdom on these matters. What he says ought to influence your Lordships very greatly. I was delighted that his experience was so vigorously supported by the noble Lord, Lord Donaldson: it was only that I was somewhat disappointed in the lack of nexus between his argument and his conclusion. I agree entirely with my noble friend Lord Morris that what we must have is a man of immense ability. He needs to be independent because this is the role in which the Bill casts him. This means that the process of selecting him must be undertaken with very great care.

The proposal in the present amendment is an entirely novel one, and it is out of line with procedures which are normally adopted in this country in relation to appointments in the private as well as in the public sector. Quite frankly, candidates attach great importance to confidentiality, and the need to consider a wide range of suitable candidates, the need to allow for flexibility in discussions and the need to ensure discretion in approaching individuals who are already in employment all argue against a procedure of the kind envisaged in this amendment.

As the amendment is drafted the results of the examination of a candidate would not bind the Secretary of State. Nevertheless, he would find it difficult to appoint a person who had failed to win the support of the Select Committee, even if that failure to win support had nothing to do with the competence of the individual to meet the requirements of the post. Equally, as my noble friend Lord Boyd-Carpenter has said, if despite the view of the Select Committee the Secretary of State decided to appoint the candidate, that in turn would lead to considerable difficulties of its own.

Given the conventions which govern public appointments in this country, I have no doubt that many potential candidates would be put off seeking the job at all if they thought that there would be a public, or semi-public, consideration of their appointment. At best it would delay the appointment of the director general; at worst it would ensure that the kind of first-class individual the Government are seeking simply would not come forward.

The fact that a process of examination by Select Committee is not required in relation to other similar appointments only serves to make the amendment more unacceptable. If there were a case to be made for the proposal—and, frankly, I do not think there is—it would be a case that would have to be made generally and not in relation to this particular post. There is no Select Committee involvement in, for example, the appointment of the Director General of Fair Trading or, if I may be forgiven for quoting the example, the chairman of the Civil Aviation Authority, and I have not heard any arguments to suggest that the Director General of Telecommunications should set a precedent in this respect.

We have given assurances that we are looking for somebody of the very highest calibre to appoint as director general. That is absolutely essential. Quite frankly, this amendment would hamper us in that task. On that basis, I would ask your Lordships to reject it.

5.34 p.m.

Lord Bruce of Donington

I am sorry that the noble Lord has taken what I can only term a rather narrow attitude towards this important and reasonable proposal. I must take exception—well, not take exception, but I must take issue with the noble Lord, Lord Boyd-Carpenter, concerning his observations on the functions of Select Committees. I myself was also a member of the Select Committee on Public Accounts in another place for a couple of years or so. In my experience the only people who had to bother overmuch about appearing before the Select Committee were people who did not know what they were talking about and who had a confused idea of the brief that may or may not have been handed to them by their civil servants.

So far as my experience is concerned—it may have differed from that of the noble Lord—it is not a question of appearing before a Select Committee to "handle" it. You are not in front of a Select Committee to "handle" the committee. The committee's members normally ask reasonable, but sometimes unreasonable, questions, as the case may be. But a competent, self-possessed person who knows exactly what he is talking about does not seek to bluff the committee into assuming that he knows something that he does not know. If he knows his own limitations he has nothing to fear from any Select Committee at all. The idea that it should be a qualification to "handle" a committee is quite wide of the mark.

The noble Lord, Lord Donaldson, seemed to think at one time that this proposal came into operation after the appointment. Of course, in terms of the amendment the appointment is made following an examination of the candidate by the House of Commons Select Committee. The Minister is able to see just how this person measures up to the sometimes skilled, sometimes unskilled, sometimes technical, sometimes overtly political—whatever it may be—questions that are asked of him.

I repeat that no person of the competence, breadth of mind, powers of leadership, personality, endurance and enthusiasm which are certainly required of the person who is going to become the Director General of Telecommunications would bother overmuch about a Select Committee. He might even have read some of the observations by very senior ex-civil servants on the general competence of Ministers in their offices. In fact, he might be tempted, if he were very unwise, to be rather more indulgent of the Select Committee than afraid of it.

Certainly there is no reason why the Minister, when he makes this appointment, should not have the advantage of seeing and noting the response of the candidate to a wide variety of questions put to him, and assimilate the general impressions of the Select Committee itself. As the noble Lord said, the Minister need not be bound by the impressions he gets of the impressions derived by the Select Committee. He need not be bound; but he can take them into account. There is no reason why he should not take them into account. It may well be that the questioning of certain members of a Select Committee rather indicate that they disapprove of the candidate. The Minister, if he is a good Minister, knows exactly how to deal with that. A Minister is quite capable of assimilating the abilities of a Select Committee, or should be.

In regard to Lord Boyd-Carpenter's observations about the position of another place, of course from time to time your Lordships' House ventures to give an instruction to another place when it refers back amendments to Bills that have come from there. It does it in that way. But there is no suggestion here of this place trying to dictate to another place at all. This Bill has come before your Lordships. We are entitled, if we so wish, and if the majority so decide, to return it to another place for their consideration. There is certainly no constitutional principle involved in that.

The importance of the appointment cannot be overestimated. Nor, I might say in sympathetic reply to the noble Lord. Lord Cockfield, do I underestimate the difficulties that the Secretary of State is going to have in obtaining a person of the qualities obviously required by the responsibilities laid upon him, and upon the Secretary of State, by the Bill.

The noble Lord will remember that when the Government were seeking a chairman of British Steel—to use the immortal words of Sir Keith Joseph—they scoured the boardrooms of England. They eventually hired headhunters in order that they could obtain a person whose qualities, although very considerable, were certainly not as far-reaching as the qualifications required here. Finally, as your Lordships know, the headhunters found Mr. MacGregor already lurking on the board of a nationalised industry, British Leyland. But that is entirely beside the point.

The fact of the matter is that the Secretary of State will have difficulty, and I should have thought it was far better for the Secretary of State to be able to assess the abilities of candidates on the basis not only of his own personal assessment, which in the final analysis is the most important and determinate, but of having in front of him a person who has already been before a Select Committee of the other place.

Above all, we do not want—I am sure your Lordships will agree—in an important matter of this kind affecting the entire conduct of a very important public service, which is already being successfully conducted, any taint of political appointment. I say that because there are one or two recent experiences that give some colour that party politics are not always out of these matters. I refer to the recent appointments of the Governor of the Bank of England, the Director of the Property Services Agency and some of the regional health authorities. We do not want that kind of thing here and I am quite sure that nobody on either side of your Lordships' House would want there to be any taint of political patronage in this appointment.

The appearance before a Select Committee of another place is one guarantee of that, even though the Select Committee in its composition is bound to be dominated by the party of Government—it always is. But as the noble Lord well knows, Select Committees have a perverse inclination—for example, as their reports on unemployment and monetary control have indicated—for scrutinising their own Government or the majority on it. This is a very sensible arrangement. I cannot for the life of me see why the noble Lord, Lord Cockfield, cannot adopt it, put it in his own armoury and even claim credit for it.

Lord Weinstock

The amendment puts forward an extremely attractive idea which the noble Lord, Lord Boyd-Carpenter, has demonstrated to be quite impracticable. But even if it were not so, there is another reason why I suggest that your Lordships should not accept this amendment. Anybody who can be thought of as applying for this appointment is almost certainly unfit to discharge it. I cannot imagine a situation in which a queue of applicants was forthcoming who would be suitable and who could be put before a Select Committee in the way suggested. Furthermore, it would give a further disincentive to a suitable person, if such exists—which I rather doubt—if he was required, prior to his appointment by the Secretary of State, to appear before a Select Committee in another place.

Lord McIntosh of Haringey

I have no wish to rehearse arguments already made, but I wish to express my gratitide for the comforting reassurance by the Minister that he adheres to the venerable principle that nothing should be done for the first time. He told us that the proposal here was entirely novel, and indeed it is, and he said that if it were to be adopted then it would have to be applied to, for example, the office of the Director General of Fair Trading, and no doubt to other offices as well.

Indeed, if the proposal of an examination before a Select Committee of another place were to be adopted and were to be successful, it would be for consideration whether the same procedure should be adopted for other offices, such as the Director General of Fair Trading. But unless we try we shall not know, and unless we try something for the first time on some occasions we shall never make any progress whatsoever. I think that your Lordships have generally misunderstood the nature of the appointment and why it would be appropriate for this appointment, but certainly not appropriate for other appointments.

We are in the presence of at least three distinguished ex-chairmen of nationalised industries and my knowledge of your Lordships' House is so short that there may be others. Those gentlemen and their former colleagues were appointed for managerial abilities and I would not suggest for a moment—and I do not think my noble friend Lord Stoddart would suggest for a moment—that one can assess managerial ability before a Select Committee of another place.

But we are talking here about a quite different kind of appointment—in the Government's own words, which I have already expressed, somebody responsible for fair play. If somebody responsible for fair play cannot stand up to being examined in public by a Select Committee, then he will not be a very effective advocate of fair play when he comes to exercise his functions. That is the reason why in this case, but not necessarily in other cases, it is an appropriate move—it is, at least, a gesture—towards a more open form of government and that is why I support my noble friend's amendment.

Lord Cockfield

I shall not detain your Lordships for more than a few minutes. There is very little that I can add to the words of wisdom uttered by the noble Lord, Lord Weinstock. I listened with great fascination to the description given by the noble Lord, Lord Bruce of Donington, of the qualities that would be required by a candidate appearing before the Select Committee. The person who would best meet those qualifications is a distinguished lawyer, a politician or a television personality, and it does not seem to me that any of those three would be outstanding candidates for this post.

So far as the arguments put forward by the noble Lord, Lord McIntosh, are concerned, they seemed to me largely to destroy the very reasonable case that had been put forward by his noble friend Lord Stoddart, because the effect of his arguments would be to politicise a wide range of appointments in this country. That is one of the reasons why I was very dubious—I do not want to pursue this too far—about accepting the argument of the noble Lord, Lord Stoddart, about American precedents. One of the troubles in the United States is that so many of their appointments are political appointments, with people going in and out of office with changes of government, and that is not the sort of thing that we want in this present case.

I approach this question on the very simple basis of asking whether the amendment would help or hinder us in selecting an outstanding candidate for this most difficult appointment. My own opinion is that the amendment would hamper us and it is on that basis that I would advise your Lordships against it.

Lord Beswick

May I ask the noble Lord one question? On two occasions on two different amendments the noble Lord, Lord Cockfield, has gone out of his way in his most emphatic manner to express his admiration for the wisdom of the noble Lord, Lord Weinstock. I wonder whether he could go a little further and say that he accepts the wisdom of the noble Lord, Lord Weinstock, so far as the Bill itself is concerned.

Lord Stoddart of Swindon

If I may reply—and I shall certainly do so very briefly, because many points that I would have made in reply have already been made by my noble friends—the noble Lord, Lord Cockfield, said that we had to decide whether this amendment would help or hinder us. The fact of the matter is that it would help him. One of the problems with the Bill is that it has undermined public confidence. Therefore to have the candidate for the director general interviewed by a select committee of parliament would assist in rebuilding public confidence, which has already been shattered by the publication of the Bill. If therefore the noble Lord were to accept the amendment, he would help the Bill in its passage through the Committee. That may be against me. Nevertheless, I happen to think that it would help the noble Lord to reassure public opinion about the bad effects of the Bill.

There are two other points that I want to make. First, the noble Lord, Lord Boyd-Carpenter, was rightly concerned about the position of the candidate when he appeared before a select committee: He might be a rather shy man, or he might be an administrator. But he might also have other weaknesses which it would be as well for the public to know about before he was appointed. Our major duty as parliamentarians is not to protect an individual, who may have been selected by the peculiar procedures which governments use for selecting chairmen, but to protect the public—in this case the public and the consumer.

Finally, I accept Lord Donaldson of Kingsbridge's concern that there could be a political majority in the select committee which would detract from good consideration of the candidate, but may I say to him that my quite long experience of select committees is that they do not work in that way. They are excellent bodies. All sides, of whatever political party, work together for the good of the select committee and, indeed, for the good of the departmental subjects that they are covering.

5.52 p.m.

On Question, Whether the said amendment (No. 3) shall be agreed to?

Their Lordships divided: Contents, 79; Not-Contents, 128.

Airedale, L. Jenkins of Putney, L.
Ardwick, L. John-Mackie, L.
Attlee, E. Kaldor, L.
Aylestone, L. Kearton, L.
Banks, L. Kennet, L.
Beswick, L. Kilmarnock, L.
Birk, B. Kirkhill, L.
Bishopston, L. Leatherland, L.
Blyton, L. Llewelyn-Davies of Hastoe, B.
Boston of Faversham, L. Lloyd of Kilgerran, L.
Bruce of Donington, L. Longford, E.
Burton of Coventry, B. Lovell-Davis, L.
Carmichael of Kelvingrove, L. McGregor of Durris, L.
Collison, L. McIntosh of Haringey, L.
David, B. [Teller.] Mishcon, L.
Davies of Penrhys, L. Molloy, L.
Dean of Beswick, L. Nicol, B.
Delacourt-Smith of Alteryn, B Oram, L.
Peart, L.
Denington, B. Phillips, B.
Diamond, L. Pitt of Hampstead, L.
Donaldson of Kingsbridge, L. Ponsonby of Shulbrede, L. [Teller.]
Donnet of Balgay, L.
Elwyn-Jones, L. Rochester, L.
Elystan-Morgan, L. Seear, B.
Ennals, L. Segal, L.
Ezra, L. Stallard, L.
Fisher of Rednal, B. Stedman, B.
Gallacher, L. Stewart of Alvechurch, B.
Galpern, L. Stewart of Fulham, B.
Gladwyn, L. Stoddart of Swindon, L.
Graham of Edmonton, L. Stone, L.
Grey, E. Strabolgi, L.
Hale, L. Taylor of Blackburn, L.
Hampton, L. Taylor of Gryfe, L.
Harris of Greenwich, L. Taylor of Mansfield, L.
Hatch of Lusby, L. Thurso, V.
Howard of Henderskelf, L. Tordoff, L.
Jacobson, L. Underhill, L.
Jacques, L. Wallace of Coslany, L.
Jeger, B.
Adeane, L. Croft, L.
Airey of Abingdon, B. Cullen of Ashbourne, L.
Alexander of Tunis, E. Dacre of Glanton, L.
Alport, L. Daventry, V.
Atholl, D. Davidson, V.
Auckland, L. De La Warr, E.
Avon, E. De L'Isle, V.
Belhaven and Stenton, L. Denham, L. [Teller.]
Bellwin, L. Drumalbyn, L.
Belstead, L. Dundee, E.
Boyd-Carpenter, L. Ellenborough, L.
Brabazon of Tara, L. Elles, B.
Brookes, L. Elliot of Harwood, B.
Brougham and Vaux, L. Elton, L.
Bruce-Gardyne, L. Enniskillen, E.
Caccia, L. Faithfull, B.
Campbell of Alloway, L. Ferrers, E.
Carnegy of Lour, B. Fraser of Kilmorack, L.
Carrington, L. Gainford, L.
Cathcart, E. Gisborough, L.
Cockfield, L. Glanusk, L.
Coleraine, L. Glenarthur, L.
Colwyn, L. Gowrie, E.
Constantine of Stanmore, L. Gray of Contin, L.
Cork and Orrery, E. Greenway, L.
Craigavon, V. Gridley, L.
Hailsham of Saint Marylebone, L. Orkney, E.
Orr-Ewing, L.
Halsbury, E. Pender, L.
Harvington, L. Pennock, L.
Henley, L. Peyton of Yeovil, L.
Hives, L. Polwarth, L.
Home of the Hirsel, L. Portland, D.
Hornsby-Smith, B. Rodney, L.
Hylton-Foster, B. St. Aldwyn, E.
Ilchester, E. St. Davids, V.
Killearn, L. Saltoun, Ly.
Lane-Fox, B. Sandford, L.
Lawrence, L. Sempill, Ly.
Lindsey and Abingdon, E. Shannon, E.
Loyd, L. Shaughnessy, L.
Long, V. Skelmersdale, L.
Lucas of Chilworth, L. Soames, L.
Luke, L. Somers, L.
Lyell, L. Spens, L.
McAlpine of West Green, L. Stamp, L.
McFadzean, L. Strathcona and Mount Royal, L.
Mackey of Clashfern, L.
Macleod of Borve, B. Swinton, E. [Teller.]
Mancroft, L. Terrington, L.
Mar, C. Teynham, L.
Margadale, L. Thorneycroft, L.
Marley, L. Torphichen, L.
Marshall of Leeds, L. Trefgarne, L.
Massereene and Ferrard, V. Trenchard, V.
Maude of Stratford-upon-Avon, L. Trumpington, B.
Tryon, L.
Merrivale, L. Vaizey, L.
Morris, L. Vaux of Harrowden, L.
Mottistone, L. Ward of Whitley, V.
Mountgarret, V. Weinstock, L.
Mowbray and Stourton, L. Westbury, L.
Murton of Lindisfarne, L. Whitelaw, V.
Northchurch, B. Windlesham, L.
Nugent of Guildford, L. Wynford, L.
Onslow, E.

Resolved in the negative, and amendment disagreed to accordingly.

6 p.m.

Lord Bruce of Donington moved Amendment No. 4:

Page 2, line 3, after ("officer") insert ("with a detailed knowledge of the telecommunications industry and telecommunications consumer interests").

The noble Lord said: I beg to move the amendment standing in my name and those of my noble friends. The amendment is designed to lay down some parameters, albeit of a very general kind, for the appointment of the director general. It does so in circumstances where there has been a focus for some time upon the politicisation of public appointments. There is a very wide measure of agreement throughout your Lordships' House that this is not a case where an amateur, however able, can be appointed.

I was a little sorry that during the course of the discussion on the last amendment the noble Lord, Lord Cockfield, in his reference to the histrionic abilities of actors, cast an indirect reflection thereby upon the President of the United States. The qualities required for a post of this kind do not include any acting ability. They include, above all, some very considerable knowledge of the whole perspective of the telecommunications industry and of the impact of telecommunications on the individual.

The director has to be able to look at consumer interests and to protect the consumer—not only formally, in legal terms, but by having an intimate knowledge and perspective based on the assimilation of much of the data that are available. That means that he must appreciate the impact of the existing telephone system on the ordinary person of this country in possession of a telephone, rather than be someone who takes a telephone for granted. To some extent, therefore, he has to be a humanist in the sense of realising the impact of services provided or denied to the individual consumer. It follows that the he must have a perspective of the present effects and of the likely effects in the future of technology as it advances and as services become extended. The director must have a perspective of the impact on the consumer whose interests he is empowered to safeguard.

Under this Bill, his responsibilities go much wider than that. One has only to look at particular subsections of Clause 3, which we shall be discussing at a later stage, where responsibilities are laid upon the Secretary of State and upon the director general in respect of a whole series of matters. Those matters cover even frequency bands and the fair allocation of frequencies, and the future prospects of British Telecom's equipment manufacturers. He even has to be knowledgeable of the economic impact of telecommunications and of the detailed overseas negotiations which go on, in determining the absorption or rejection by various countries of telecommunications equipment. He has to be knowledgeable not only in the ordinary telecommunications sense but also in respect of the economic interplay of telecommunications throughout the world: the effects of their greater or lesser commercialisation, and the consequences of state control in one country and of no state control in another. The director general has to be able to assimilate the consequential effects of the imposition of tariffs and of the imposition of quotas by other countries against various types of telecommunications equipment. He has to be conversant with the whole spectrum of the telecommunications industry and its effect abroad, and between other countries and ourselves.

All this does not ask that the appointee should of necessity be a technical engineer as such and have a detailed knowledge of the working of circuits, to be able to design circuits himself and do things of that kind. But it does mean that he must know how the equipment performs, what its capabilities are, what its capacity is, and what its potential for development in the several departments of British Telecom and its prospects for the future are likely to be. He must therefore be a person to whom telecommunications becomes, in regard both to its present technical and capacity aspects and to the inter-relationship between it and other forms of equipment in the future, a dominant part of his life and philosophy.

Those are not stringent conditions. There must be people in the United Kingdom who can offer capabilities of that kind and who do not need "headhunters" to search them out. In making an appointment, one always to some degree sets certain parameters which cannot be satisfied, because nobody is perfect. Above all, the person selected, in having a knowledge of the telecommunications industry, and having responsibility for the enforcement and amendment of licences and other matters of that kind, must also have a knowledge of how to deal with people. One is talking not only of consumers but also of approximately 230,000 people who are employed by British Telecom itself, and another 100,000 approximately, who are employed in the telecommunications manufacturing and service industries.

It is with overwhelming emphasis on the more technical aspects of the matter that this amendment is designed to secure, as a qualification, the parameters within which the appointment should take place. Above all, the Committee does not require a political appointment or an amateur appointment. It requires a person dedicated to the present and to the future of telecommunications.

Lord Morris

It will come as no surprise to the noble Lord, Lord Bruce of Donington, that I look at this particular problem in a totally different way. Given the correct man with the wit, the will and the skill to learn, his ignorance of the particular subject becomes an extremely important qualification. The reason I say that is because this point reminds me of a comment made by an extremely distinguished surgeon—namely, Sir Ralph Marnham—when a Member of your Lordships' House suggested to him a particular way of carrying out a certain surgical procedure. Although Sir Ralph was a little upset by this, he took the point on board, suggesting at the same time that experience is nothing other than entrenched prejudice. If a person has training in a particular field of endeavour there is no question about it they have very fixed and rigid ideas on this that or other subjects.

I would have thought that to restrict by law the Government's appointment of a man in this critical, important position is a very dangerous thing to do. I am not trying to plead the cause of the enthusiastic amateur. I am no lawyer myself, but any lawyer who has cross-examined the soi disant expert witness in the box will almost certainly agree in saying, "Lord deliver me from an expert".

Lord McIntosh of Haringey

I wonder whether the noble Lord's story does not rebound against his own argument. What he is describing is advice given by a Member of your Lordships' House to a surgeon, in other words, he is describing a position comparable to the advisers of the director general or as it would have been if the first amendment had been passed the authority. The director is in the position of the surgeon. Is the noble Lord suggesting that he would be happy to have been operated on by the distinguished Member of your Lordships' House?

Lord Morris

The noble Lord, Lord McIntosh, has just broken one of the cardinal rules of cross-examination: never ask a question to which you do not know the answer. The person who gave the advice to Sir Ralph Marnham had been an extremely distinguished surgeon himself.

Lord Campbell of Alloway

This is the age-old argument, very briefly, of the specialist against the administrator. There are hundreds of specialists; there are a handful of administrators. What is needed is a good administrator. It is a question of status. I oppose this amendment.

Lord Cockfield

I of course understand the concern that has been expressed both in this debate and earlier this afternoon that the director general should be a person who has the kind of knowledge and experience that will fit him to do what will be a job of outstanding importance and indeed of difficulty. We intend to appoint as director someone both with relevant experience and with authority who will measure up to the most exacting standards. I entirely agree with what my noble friend Lord Campbell of Alloway said, that this is another illustration of the old argument about the merits of specialists and generalists. But of course the amendment goes very much further than that. Contrary to what the noble Lord, Lord Bruce of Donington, said when he described the amendment as one which set down parameters of a very general kind, the fact of the matter is that the amendment creates a statutory straitjacket, and this is the kind of thing which is wrong.

Obviously, knowledge of the telecommunications industry and of the requirements and needs of consumers is very relevant and important: but it is not the only qualification which would suit a person for appointment to this post. For example, we know that the accounting systems of British Telecommunications leave very much to be desired and that considerable development in this field is needed. An outstanding and distinguished accountant—and I hope the noble Lord, Lord Bruce of Donington, will forgive me introducing this example—might very well be a good candidate for this post. All I am saying is that we ought to look at the full field and that we ought not to start by limiting our field of choice. Recognising that we must select the best candidate who is available, we must look for a whole range of qualities and experience and we must balance the strengths and weaknesses of potential candidates in forming a judgment about the right individual for the job.

This amendment would in fact hamper us in that task, because it would restrict the field of candidates and could well exclude some who were nevertheless ideally suited for the job. I think it has been valuable to air these problems and difficulties; but the arguments point, I submit, quite decisively against the amendment.

Lord Taylor of Gryfe

Having heard the statement of the Minister, which was a fair job description of the man sought for this important post, having at the same time accepted the concern expressed by the noble Lord, Lord McIntosh, I hope that having been given the assurance of the kind of man the Government have in mind the noble Lord will consider not pressing this amendment to a Division.

Lord Bruce of Donington

I am grateful to the noble Lord for having taken on board the burden of the argument that I adduced in favour of this amendment. The amendment does not of course seek to restrict the qualifications of the appointee merely to have this knowledge. Quite clearly he or she must have many other qualities. This amendment was put down to ensure that this was included as a vital quality among those others to which the noble Lord referred.

I am very sorry indeed that the noble Lord cannot take it on board, but I sincerely hope that sufficient has been said on both sides of the Committee today to make it quite clear to Her Majesty's Government that this is not a case where a political appointee would in any way be suitable. I gathered from reading within the context of what the noble Lord has said that the Government have no such intention; that they do have the intention of searching as widely as they can, with or without the aid of head hunters, as in the case of Mr. MacGregor; that they do intend to take very great care about it indeed and that they do intend to treat this exceptional appointment as one that merits the services of quite an exceptional individual. On the basis of what the noble Lord and other noble Lords have said in the course of the debate, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Spens moved Amendment No. 5:

Page 2, line 7, at end insert ("and such other relevant functions as the Secretary of State may from time to time assign.").

The noble Lord said: I think it is appropriate that, as chairman of our liberalization group, I should put myself down to open the batting for them, although my usual place in the team was at No. 6 or No. 7 when the shine was off the ball and I could swing my bat a little. Our group consists of more than 20 members, of all Parties other than the Official Opposition, but acting in their personal capacities, and not necessarily every member of the group agreeing with every amendment that has been put down in our name. In order to try to identify the amendments which our group is sponsoring, I have put my name down on as many amendments as I can. Even so, there are one or two to which my name is not attached but which are still included in those sponsored by our group.

We have had five meetings and we have taken evidence—if I may call it that—from six trade associations and from some other bodies. Therefore, very few of the amendments tabled are our own. I know there are one or two which are, and I have one myself, but the majority of the amendments in my name have been recommended to us by responsible trade associations and we have accepted them after discussion with their representatives.

Turning to Amendment No. 5, the problem that we see is that the director general has to have the functions—almost all-powerful functions—to cover every eventuality. As we read Clause 1(1) there appears to be a limitation on the power of the Secretary of State to assign functions to the director general to cover situations which do not exist at the moment but which might exist in future. Who is to know what might suddenly crop up with the speed of development in these highly technological industries? All sorts of different ways of communication may happen. For example, before we know it, we may be using light waves, or something of that nature, to communicate with each other. Whether the Secretary of State can give additional functions to the director general, I do not know, so this is a probing amendment. I beg to move.

Lord Campbell of Alloway

With the greatest respect to the noble Lord, Lord Spens, at whose invitation I have decided to intervene, and to the members of the group, may I come straight to the merits of this amendment. It could be truly said that this amendment might induce the very obscurity which it was designed to remove. The words "relevant functions" as drafted in the amendment could induce much argument as to whether the Secretary of State, in assigning such functions, was or was not acting ultra vires. The drafting of the clause is wholly clear and could be rendered specific by the traditional method of reference to the body of the statute. It is in traditional form and, with the utmost respect to the noble Lord, I think the amendment might serve to confuse rather than clarify.

Lord Lloyd of Kilgerran

As a member of the liberalisation committee may I take the opportunity of congratulating the noble Lord, Lord Spens, for the objective way in which he conducted the proceedings. He said that the group was sponsoring all these amendments, but this is one amendment which I was reluctant to sponsor for the very reason given by the noble Lord, Lord Campbell of Alloway. I was also worried about the words "relevant functions". They would be difficult to define. As the noble Lord, Lord Spens, indicated, this is a probing amendment but if it were moved to a Division I could not support it.

Lord Mottistone

I think my noble friend Lord Campbell of Alloway was a little hard on the noble Lord, Lord Spens, because the noble Lord did say that it was a probing amendment and the technicalities of the law are not really a matter to be exposed under those circumstances. The point of this amendment moved by the noble Lord, Lord Spens, as our excellent leader—I am privileged in being included in his group—is that it is terribly important that there should be scope for future expansion of the duties of the director general as the telecommunications industry works on. I hope that my noble friend will be able to tell us that this is very much in the Government's mind.

I make only one other comment. So far as I am concerned, the amendments I have tabled are my amendments. The fact that we may have had advice from some people is, at this stage of the game, totally irrelevant.

Lord Campbell of Alloway

Before my noble friend sits down, may I explain that far from seeking to be hard on the noble Lord, Lord Spens, and far from seeking to rely on words or to pick on words, my reference to words was only intended to illustrate the problems and the principle at stake.

Lord Orr-Ewing

As honorary secretary of the group perhaps I could intervene very briefly.

A Noble Lord

Late on parade.

Lord Orr-Ewing

Yes, I was late on parade, but having heard three Labour Front Bench spokesmen on the previous amendment I imagined that that would be repeated for the rest of the amendments. I was wrong, and am delighted that I was wrong.

As this is my first speech perhaps I should declare no further interest than I declared on Second Reading. I am, in fact, a non-executive director of a public relations company. I have had no contact with any of the company's 40 or 50 clients. What I say and do in this place is in no way connected with my position as a non-executive director or with any of the clients.

I feel that it is difficult on this Bill, which was heavily filibustered in another place, for the Committee to make a proper consideration of a very complicated and long measure. It is a very important measure, wherever we may sit. My noble friend did well to bring us together from all parts of the Committee because it would be grossly unfair if various people who wanted to make representations—namely, the trade associations—whose future is at stake, had to apply to individuals all over the place; to little groups here and little groups there.

We did a service in having the opportunity of, as we did, taking evidence from six trade associations all of them very closely connected with this industry. We saw the user group. We saw the Telecommunication Managers' Association, which contains some of the natural clients of Mercury. We saw the Telecommunication Users' Association and we saw the Mobile Radio Users' Association. That is three user trade associations. Of course, we have also taken note of what POUNC, and others, had to say and also the Consumers Association. On the manufacturing side we asked three manufacturing trade associations to give evidence to us. That was BETA (the Business Equipment Trade Association) and TEMA (the Telecommunications Engineering and Manufacturers' Association). Incidentally, its members have £1.2 billion annual turnover and 50,000 employees, so they are not small people. The other organisation was the Electronic Engineering Association whose members have £2.2 billion annual turnover and employ 100,000 people. I was president and chairman of that association in 1970 so I know it fairly well.

What I wanted to say on this amendment is that, because it is a complicated measure we have come together but we are not carbon copies of each others' thoughts. We sit in different parts of the Committee and have differences of opinion, which is only natural. Incidentally, that is something which this place demonstrates superbly well and cannot be duplicated in another place. I want to quote the need for flexibility. In his admirable opening speech on Second Reading my noble friend said: We believe in allowing market forces to operate to the fullest extent possible". Many of us on this side believe in that but it has not been possible, for various reasons, for market forces to operate very widely or very thoroughly. My noble friend continued, referring to the Office of Telecommunications: The director's function therefore is both to protect the consumer and to ensure fair competition".—[Official Report, 16/1/84; col. 843.] Our amendments—and there is a whole series on Clause 3—will seek to make fair competition. The only person we can see who can possibly judge that the competition is fair is the director and Oftel. In their individual capacities, our amendments seek to get justice, not necessarily and always for British Telecom, which will get justice anyhow. It will dominate the market, with its 97 per cent. No one has to look after British Telecom's interests very much; it has the advantage. But we want to see justice for the smaller people and an element of competition. A series of amendments will come which deals with the strengthening of Oftel's functions. We do not think that it is a perfect solution, but there is no other in sight. Politics is the art of the possible. That is why we seek to improve the Bill in these respects.

Endorsing what my noble friend Lord Mottistone said, I think the important thing is the flexibility. None of us can be wise enough to see what the future holds, and no other area of technology and science is expanding more rapidly than information technology. Therefore, I particularly commend to noble Lords, wherever they may sit, this small amendment which adds that flexibility which I think will improve the Bill.

6.31 p.m.

Lord Cockfield

I entirely accept the point made by the noble Lord, Lord Spens, that this is intended to be a probing amendment. It is on that basis that I deal with it. Clause 1(1) says that the director general shall be appointed: for the purpose of performing the functions assigned or transferred to the Director by or under this Act". The Bill sets out a whole list of functions in Clause 3 and in very many subsequent clauses. In every case it indicates whether those functions are to be formed by the Secretary of State or the director, or may be delegated by the Secretary of State to the director, and so on.

The amendment raises two points. The first is a purely legal point and the second is more a point of substance. So far as the legal point is concerned I could not possibly improve upon the explanation given by my noble friend Lord Campbell of Alloway and by the noble Lord, Lord Lloyd of Kilgerran, both of whom are distinguished lawyers. As a matter of law, you simply cannot have a reference to something which is merely "relevant" without defining what the word "relevant" means. No one would really know what it was intended to convey, and it would open up room for argument. It would also give an enormously wide and, I suspect, undesirable degree of freedom to both the Secretary of State and the director to expand the functions that they were undertaking. The general pattern of this Bill has been to define those functions rather strictly.

My noble friend Lord Mottistone indicated that there might well be developments which he had in mind which ought to be performed by the director. There are amendments which appear in the Marshalled List which would extend the field of activity of the director. If there are such fields of activity, the right thing is to include them in the Bill. Having done that, they would then be covered by the specific phrase in the Bill: assigned or transferred to the Director by or under this Act". I hope that this explanation will lead the noble Lord, Lord Spens, to feel that he now understands what in fact is intended by those specific words in subsection (1).

Lord Bruce of Donington

We on this side of the Committee are happy to sustain the noble Lord, Lord Cockfield, in his interpretation of the amendment and its effects. At the same time, we are extremely grateful to the noble Lords, Lord Spens and Lord Orr-Ewing, for the engaging manner in which they have informed the Committee of the various people with whom they have consulted and who have sought their aid as to the forms of policy that they wish to see put before your Lordships. When we come to consider later amendments which deal with these functions more specifically in the manner suggested by the noble Lord, Lord Cockfield, we shall at least now know the interests, and the extent of them, that lie behind the amendments. We are obliged to the noble Lords for that.

We note as a matter of compliment that as the official Opposition we were not approached and have not been associated with this august body. We would straightaway say that we as the official Opposition have received a number of representations from all kinds of bodies, not only those representing manufacturers and other specialised firms engaged in manufacture but, above all, those representing consumers and the great bulk of the population who are in the possession of a telephone.

We think that the adoption of the amendment would dangerously extend the Secretary of State's powers. On the assumption that he could survive the legal hurdle which was referred to and which was put more specifically by the noble Lord, Lord Campbell of Alloway, he would have more powers than we on this side of the Committee would be prepared to give him. He might stray considerably outside the scope of the very considerable powers that he already possesses. We do not think that would be good for the Government or the country. I am afraid that we oppose the amendment.

Lord Taylor of Gryfe

I confess to having been a part-time member of the group which was set up on the initiative of the noble Lord, Lord Orr-Ewing. We are indebted to the noble Lord and his group for their very detailed examination of the Bill. The results of that examination will no doubt emerge in subsequent amendments. I find the noble Lord, Lord Cockfield, in his most engaging and persuasive mood tonight. He has persuaded me that this is an unfortunate amendment. The noble Lord, Lord Spens, having expressed the view of the group, I hope he will be induced to withdraw the amendment.

Lord Spens

I am grateful to noble Lords for their kind expressions. I should like to remind the noble Lord, Lord Bruce of Donington, that at the very end of my speech on Second Reading I issued an open-ended invitation to any noble Lord in your Lordships' House to join the group. I think that that invitation was picked up by one or two noble Lords.

I have a guilty conscience over the word "relevant", which I myself inserted into an amendment which I thought otherwise would be too broad. But I am not quite happy with the explanation given by the noble Lord the Minister. He is still referring to functions which are set out in the Bill. What I am after is to make sure that in the future the director general will be assigned any additional function which may crop up through the effect of new inventions, which cannot therefore be foreseen at this time and which will therefore not be in this Bill.

However, I said that this was a probing amendment and I do not propose to pursue it now, though perhaps my group will have another look at it before the Report stage. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

6.40 p.m.

Lord Stoddart of Swindon moved Amendment No. 6:

Page 2, line 9, after ("years") insert ("and subject to termination within the first six months of the meeting of a new Parliament")

The noble Lord said: I beg to move Amendment No. 6, which stands in the names of my noble friends Lord Bruce of Donington and Lord McIntosh of Haringey, as well as my name. As has already been said, in discussing the appointment of the director general we are considering a unique appointment. He will be responsible for all the matters that we have mentioned so far, as well as all those not yet mentioned but which nevertheless are contained in the Bill. He will be responsible for policing the licences and for protecting consumers' interests. It will be a very important public appointment which could have a crucial bearing on the efficiency and indeed the public image of any government.

The appointment will touch people closely every day. The cost of people's telecommunications services will to a very large degree be governed by the appointment, and it will affect the kind of telephone system they have. It will also affect, for example, whether people have modern telephone extensions in their homes and whether they will be able to shop by telephone, which will be of particular importance to people who are disabled. The appointment will also affect the question of whether or not rural areas are properly protected and whether they are deprived of services which urban areas already have, or will have. As I have said, it will be one of the most important public appointments that a government will make.

Our amendment suggests that a new government coming into office should have the right within six months of a new Parliament being elected to reappoint the person who has been appointed by the previous government. I believe that that is a perfectly reasonable proposition to put forward. It must surely be understood by everyone that an incoming Labour Government—which I trust will be the case after the next general election—may very well not wish to be in the hands of someone who has been appointed by the present Conservative Government.

Let us suppose, for example, that the present Government appointed someone such as Mr. Ian MacGregor. I do not wish to be unkind to Mr. MacGregor in any way at all. In fact, I am sure that he is a perfectly nice, reasonable fellow when one meets him face to face and in his personal life. But he is anathema to the Labour party. We simply do not like the way he operates. Your Lordships may say that that is disgraceful, but I am telling your Lordships what we honestly believe of Mr. MacGregor because of the actions that he has taken in certain industries—the steel industry, and now the coal industry—with which we completely and utterly disagree. I have made it perfectly plain that we have no quarrel with Mr. MacGregor as a personality. But in the Labour Party we believe that the policies which he is pursuing—no doubt at the behest of the Government, but nevertheless pursuing—are harmful to the industries concerned and are therefore harmful to the economy of the country.

The point that I am trying to put over is what might happen with regard to Mr. MacGregor in the case of an incoming Labour Government. I do not know who would be involved in the case of an incoming Conservative Government—perhaps it would be Mr. Ken Livingstone. But the incoming government may wish to appoint someone else, and I suggest that it is perfectly reasonable that they should have the opportunity to change the director general.

I have no doubt that I shall be told that the director general will ostensibly be non-political. But as I have already explained, by its very nature the job is bound to have significant political overtones. For example, one of the director general's duties is to promote competition, and it is very likely that an appointee of the present government will be wedded to the philosophy of competition and will probably be an arch privatiser.

Clearly such a person would not be acceptable to a Labour Government, especially if that government wished, as they may very well wish, to return British Telecom to public ownership, where we think it belongs, and from which we do not believe it should be removed. Under those circumstances a Labour Government might find it very difficult to have a director general who would be a veritable hindrance and an obstruction to their policies, which would have been put before the electorate and, if the party had been elected, would have been approved by them.

What I am suggesting is perfectly reasonable and perfectly constitutional. If for any reason at all the appointment of the director general by a Tory Government took place just before a general election—and this, too, is an important point—as the Bill now stands without the amendment, a Labour Government would be saddled with that director general for the whole of their term of office. Similarly, a Labour government making an appointment just before a general election would saddle a Conservative Government with an appointee with whom they did not agree, and who might very well be working against their own particular interest. I consider that that would be quite intolerable.

Even if a Labour Government did not wish immediately to return British Telecom to public ownership, they would want a director general with whom they could work and who would put forward the ethos and the policies of that particular Labour Government. We would want to see a man who would operate in the interests of the public who had elected the government.

Therefore I believe that this modification is needed to ensure that an incoming government have the flexibility and the means to carry out the policy which has been put before the electorate in a manifesto. So far I have mentioned only two parties, but this applies to them all. The modification would give an incoming government the flexibility to do what they felt was right for the public, for their constituents; and, indeed, for the country. I beg to move.

6.50 p.m.

Lord Thorneycroft

I hope that the noble Lord, Lord Stoddart of Swindon, and other noble Lords who are moving this amendment will not press it to a Division. I do not believe that there is much difference between both sides of the Committee in this respect at least—that we want the ablest possible man we can find to take on an appointment of enormous difficulty. In the years to come, that man will sometimes be appointed by a Conservative Government and no doubt sometimes appointed by a Labour Government——

Lord Donaldson of Kingsbridge

Or by the Alliance.

Lord Thorneycroft

I am confident that both Governments would do their level best to find the ablest man possible for the job in question. To introduce this amendment would militate considerably against finding such a man. Within the short period before an election was due, it would prove almost impossible to find someone whose term of office was not three or four years but might be a few months. Put yourselves in the position of someone taking this job. It would be quite a big decision to take, anyway. It would probably mean—if he was any good at all—that he had to give up some considerable appointment he was already holding. I do not think that anyone would be found to take a job where, within a short time, on the mere quirks and changes, and ups and downs, of politics, his whole position would be put in jeopardy again.

This idea of changing everyone on change of government is an American idea. It is not a British idea. I am absolutely confident that the noble Lord, Lord Bruce of Donington, and others are as anxious as I am and the Government Front Bench are to find a good man for this job. I do not believe that the amendment will help, and I hope that it will not be pressed.

Lord Somers

We have had a good deal of conversation on what type of man we want for this job. We have discussed the need for a person of wide experience, skilled in administration and possessing technical knowledge, and so on. One thing that he will not be is a party politician. I hope sincerely that his appointment will not be made on a party basis. The whole thing is entirely apart from politics. What has the appointment to do with politics? It is to do with telecommunications. If we get the right man, for goodness sake, let him go on for his full term of office. It may be for five years. It is possible that he might be reappointed. That depends upon what we decide. But his position should not be affected, as the noble Lord, Lord Thorneycroft, says, by the ups and downs of government.

Lord Bruce of Donington

The noble Lord, Lord Thorneycroft, and I myself are in substantial agreement in many respects. We have been in politics for a long time. We have both served or supported governments that have accepted the validity, to a large extent, of consensus politics. In other words, the Government of which he was a distinguished member under Mr. Macmillan did not vastly disturb the actions of their predecessors. For a long time, ever since the end of the war, it has been the policy of successive governments not to take violent action in securing the reversal of appointments made by their predecessors.

We are now dealing with a different kind of Government that believes in confrontation. In reply to the noble Lord, Lord Somers, who said that this was not a political appointment, it ought not, of course, to be a political appointment. But this is a highly political Bill. Its whole purpose, when stripped down, is to provide finance for the Chancellor of the Exchequer. It has nothing to do with the purported objects of the Bill which are to improve British Telecom. My noble friend Lord Stoddart of Swindon was in effect saying that, after the return of a new Government, active steps will be taken to restore British Telecom to where it properly belongs in the public sector. In those circumstances, it is only proper that we should give notice that we might find it necessary to make changes in the office of the director of Oftel.

I am convinced that as the debates in this place unfold in Committee, on Report and at Third Reading—on the assumption that there is adequate coverage in the press of what transpires in your Lordships' House, which is often questionable—the more the public will become disenchanted with the whole of this wretched Bill. Its only purpose, as I have said before and as I propose to prove, is to raise money for the Chancellor of the Exchequer to use for future tax reductions prior to a general election. Within that political context, we must obviously take a different attitude.

I agree with the noble Lord, Lord Thorneycroft, that we should not go towards the policies of the United States in making political appointments so that when one president comes in, a whole lot go out and another lot come in. The amendment will not be pressed to a Division. However, we thought that the House and the country should hear our views on this matter. Those who seek to ram down people's throats confrontational politics should know that ultimately there is a resolve to counteract that in the most suitable and public form.

Lord Taylor of Gryfe

I am glad that the noble Lord, Lord Bruce of Donington, is not to press this amendment to a Division. It will avoid the embarrassment of the Alliance failing to subscribe to a point of view that has been expressed from the Opposition Front Bench. I subscribe to a good deal of what was stated by the noble Lord, Lord Thorneycroft, except that he limits the possibility of alternative government to one party—a rather limited view, I would naturally and respectfully suggest, of future prospects in British politics.

In relation to what was stated by the noble Lord, Lord Bruce of Donington, I think that this is a bad Bill. I believe that the British public will join with him in regretting the passing of the Bill. All my experience of this kind of operation in other countries fortifies that view. At the same time, the Alliance will not enter into a commitment that everything that is privatised in this period of Government will inevitably be re-nationalised when we get an alternative Government. That is the way to economic chaos. This country has suffered from it in the past. That is why we have an Alliance in this House and in the country.

Everyone has subscribed to the view that this is a unique appointment in which tremendous power is vested. To that extent, we have the responsibility to get the best man. The best man will not accept an appointment if he is liable to be dismissed within three months of a change of government. That is not the way in which public appointments should be made in this country. I should like to say in the presence of the noble Lord, Lord Peyton of Yeovil, that, during his distinguished period as a Minister he never at any time practised political discrimination in the appointments that he had to make from time to time. I speak from some personal experience of his Ministership.

We must get a unique and a powerful man. How can we attract him if we start surrounding the appointment with these type of limitations and constraints? The man who is appointed has his terms of reference laid down in the Bill and to that extent they are not politically biased one way or the other. He is asked to do a particular job within the Bill and he has a responsibility to the Minister for carrying out his appointment.

If this type of provision were included in the Bill, it would certainly affect the prospectus of the company. If one has to write in that the director general may be dismissed within three months of a change of government, it is bound to be considered a factor to be taken into account by any investors in this new organisation. I suspect that if we are anxious to get the best price—and all right, I am against the Bill—for the taxpayer in the flotation of the Bill, we must not surround the appointment with these types of political constraints. I would normally be on the same side as the noble Lord, Lord Bruce of Donington, as regards the principle of the Bill, but in this particular case the Alliance and I are opposed.

Lord Peyton of Yeovil

I should like to acknowledge what the noble Lord, Lord Taylor of Gryfe, was kind enough to say about me just now. Let me also very briefly express my agreement with my noble friend Lord Thorneycroft and at the same time my perhaps naive surprise that the noble Lord, Lord Bruce of Donington, did not see fit to remind his noble friend that he had only recently made the voyage, as I have myself, from down the corridor. What the noble Lord, Lord Stoddart, said was, if I may respectfully say so, vintage House of Commons stuff in a not very good year!

I do not want to repeat the arguments which have already been very well put, but I do not think that we would be well advised, whatever the merits of the Bill, to add to the uncertainties of an appointment to a post which is already surrounded with very considerable difficulties. The Secretary of State is enabled under the Bill to dismiss for either incapacity or for misconduct. Those surely are adequate grounds. To engender into this matter as the noble Lord, Lord Stoddart, has attempted to do, a degree of political acrimony of this kind, is very unfortunate, and to launch from such a speech an attack on Mr. Ian MacGregor, whom he declared to be anathema to the Labour Party, and then to go on to say that he had no quarrel with him, was in my view regrettable.

Viscount Massereene and Ferrard

I should like to reply to the noble Lord, Lord Bruce of Donington. It is very dangerous—

Noble Lords


Lord Molloy

Fair play cuts both ways. This debate could have been terribly acrimonious, but it was not. I have listened to it very carefully. However, one question must arise. It is not impossible for the Secretary of State to appoint a director general who, after a few months or even a year in that post, was found to be unsatisfactory. I ask the noble Lord, Lord Cockfield, whether the Secretary of State would have the power to rid himself of the person whom he has appointed. That question needs answering. I am very glad that my noble friend Lord Bruce of Donington has probed deeply with my noble friend Lord Stoddart into this matter.

I should like to comment briefly on the question of Mr. MacGregor. There was nothing quite like it in the history of this country. I do not suppose that many people know who is the director general or the chairman of the BBC, or any of the great publicly-owned industries. There is grave apprehension—not merely in the Labour Party but outside as well—about the fact that someone could be appointed who might be as notorious as Mr. MacGregor—he may not think so, but in the view of tens of thousands of people he ruined the steel industry and is proceeding to ruin the coal industry. If the Bill becomes law and the whole process is set in motion and by some terrible quirk the Secretary of State makes a mistake and the wrong type of person—and this has nothing to do with politics—is appointed, would the Secretary of State have to come to Parliament to get rid of the director general or would he have the power to get rid of him himself?

Lord Beswick

One or two noble Lords opposite have seen fit to make some almost personal comments about the speeches made from this Front Bench; they have spoken about the quality of their contribution to this discussion. Let me remind noble Lords opposite that my noble friends are now talking within the context of a Bill which we believe to be utterly bad. I do not believe that noble Lords opposite really understand the feeling in the country about the motivation and the administration behind this type of legislation. It is being brought forward in a way, in a spirit and for a purpose, which we believe to be wholly contrary to the wellbeing of this country.

If there are speeches and amendments that, in the context of the more august and leisurely proceedings in the other place and the way in which they courteously bandy forth arguments in the other place, are a little surprising to the noble Lord who has just arrived here—and if the noble Lord finds that this place is much more acid in its debating than the place from which he has just come—then let me remind him that we are now faced with a situation in this country which is different. We have legislation coming before us which excites the most critical and the most feeling——

Viscount Trenchard

Will the noble Lord give way? Does he not realise that the Bill for the nationalisation of British Aerospace was, to many of us, just as emotive as this one? What we are talking about is whether, within the context of this Bill, we can revise it sensibly. In those terms we should remember that the noble Lord, Lord Beswick, continued his contract with British Aerospace under a Conservative Government. We thank the Labour Government for Sir Michael Edwardes, whose appointment I think started under that regime. We also had Dr. Richard Beeching (as he then was) from the same stable. I will not go on. Sir Arthur Cockfield (as he then was) got his second term in charge of the Price Commission under a Labour Government. Let us keep politics out of these Bills.

Lord Beswick

I quite understand the noble Lord's contribution. I am prepared to debate with him at some length the difference between the process which brought the aviation industry in this country under one ownership, and the motivation behind this transfer from the public sector, with all the tradition that there is behind the public activity in this sector. It is a completely different operation and the noble Viscount should try and understand that.

It was said earlier—and, indeed, it was even said by the noble Lord, Lord Taylor of Gryfe—that we have to try and make the prospectus, when it comes out, as plausible as possible. I could not accept that view. When this operation goes to the City it will be a flop. People will understand that there is a great deal of uncertainty behind it. I do not think that it will be successful. This doubt about its success is one more reason why we should have brought it forward in a much more careful way and much more reluctantly than the present Government have brought it forward in this Parliament.

Lord Cockfield

The noble Lord, Lord Stoddart of Swindon, made it perfectly clear that his amendment was based on purely political motives. So far as that is concerned, the matter was settled on 9th June last year in the general election, and it is quite unnecessary for me to add anything to that.

The real issue now involved is the one advanced by my noble friend Lord Thorneycroft, supported by my noble friend Lord Peyton of Yeovil and by the noble Lord, Lord Somers; namely, that we now have to find the best possible man to do this job. The effect of the amendment would be to create doubt and uncertainty. The public interest requires that once this Bill is enacted, as it will be, and implemented, as it will be, the industry should then be free to develop and expand, subject only to the regulatory framework that we have provided.

A crucial element in this is that the director general should be a man of independence, who will carry out his important functions without political bias. This is essential if he is to win the trust and respect of the industry and the public. The director general will have a vitally important task in overseeing the transformation of the telecommunications market in this country and ensuring that there is free and fair competition. We are looking for someone with an established track record. Such individuals are unlikely to be encouraged to take on such burdens as will be imposed by this Bill if the amendment were to be adopted.

Potential candidates would see immediately that, far from being certain of their future, they would be at the mercy of party politics, which is something which ought to be avoided in this field. That would be entirely wrong in relation to the appointment of the head of a non-ministerial government department, which is what Oftel will be. In this respect the Bill follows the precedent of the Fair Trading Act, which sets a maximum of five years to the term of office of the Director General of Fair Trading. We ought to follow that precedent, not to depart from it.

The noble Lord, Lord Molloy, will find the answer to his question in subsection (3) of Clause 1 of the Bill, copies of which are available in the Printed Paper Office. I am glad to note that the noble Lord, Lord Stoddart, does not propose to press his amendment.

Lord Stoddart of Swindon

I should like to say just a few words in reply to the debate, although I think that the major points were made by my noble friend Lord Bruce of Donington. I have been accused of being political. Of course I am being political; and the reason I am being political is that over a period of four to five years we have seen some highly political actions being taken on the other side. Since 1979 there has been a political revolution, albeit a Right-wing one, and it has been carried out to some degree by appointments made in publicly-owned industries.

The present Government have not hesitated to move politically against people with whom they do not agree and who will not serve their purposes. For example, I well remember that there was a wholesale massacre of the chairmen of regional health authorities, including my own in the south-west region—an area also represented by the noble Lord, Lord Peyton, who I was extremely pleased to hear make a contribution. Although my own contribution was not necessarly (and I did not mean it to be) vintage House of Commons, I thought that the noble Lord's contribution tonight was vintage Peyton, and I enjoyed it very much.

We have agreed to withdraw this amendment, but it needs thinking about. The present Government need to think about it because there are worries about the sort of appointments that are being made. It would have reassured this side of the Committee, and it would certainly have reassured the public, if the Government had had the courtesy and sense to have accepted either Amendment No. 1 or Amendment No. 3 this evening. That would have given us the safeguards which would have brought about the continuation of that consensus which, as the noble Lord, Lord Thorneycroft, well knows—he was part of it, and a very distinguished part of it—was enjoyed between 1945 and 1979. We did not need to move such amendments as these then; but unfortunately the political situation has changed to the extent that we now need to move them because we fear what is being done. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Denham

I think that this is probably a useful point at which to adjourn the Committee stage of this particular Bill. Before I move that the House do resume, it might be helpful to your Lordships who are interested in this Bill to know that we shall not return to it before 8 p.m. I beg to move that the House do now resume.

Moved accordingly, and, on Question, Motion agreed to.

House resumed.